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Providers May Soon Be Unable to Report Unpaid Medical Debt to Collection or Credit Reporting Facilities


A bill to prohibit healthcare providers from reporting unpaid medical debt to a collection or credit reporting facility is working its way through the New Jersey Legislature.

Assembly Bill 3802 (and its companion S2428) define “medical creditor” as any healthcare provider that provides healthcare services and to whom the consumer owes money for healthcare services, or any person who purchases a debt arising from the receipt of healthcare services. Healthcare provider includes a physician, dentist and other licensed healthcare professionals, and a hospital and other licensed healthcare facilities.

The bill comes on the heels of an announcement from reporting agencies that they are curtailing the inclusion of medical debt in credit reports. The three nationwide credit reporting agencies – Equifax, Experian, and TransUnion – announced in March that effective July 1, 2022 they would no longer include paid medical collection debt, and unpaid medical collection debt would only appear after one year instead of six months. In the first half of 2023, they will no longer include medical collection debt under $500 on credit reports.

This legislation, if signed into law, would go a step further and prohibit the unpaid amounts from even being reported to the credit agencies. The companion bills have been referred to the Assembly Financial Institutions and Insurance Committee and the Senate Commerce Committee, respectively.




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