We have a new name — RIP Medical Debt is now Undue Medical Debt.
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Undue Medical Debt Supports Credit Agencies Clearing Majority of Medical Debt

The national nonprofit also supports additional government action

Undue Medical Debt celebrates this change that will help millions – this course correction is welcome and overdue.

  • Since 2014 we’ve worked tirelessly to change the national conversation around medical debt and remove the stigma by amplifying the voices of those struggling and the nonprofit is thrilled to see this action.
  • But this is not a silver bullet. This change is an important step in addressing one of the key impacts of medical debt for some people but does not solve medical debt – the issue remains urgent.
  • To be clear, the credit agencies are only removing paid medical debt – yes, even paid medical debts historically have lingered on credit reports for up to 7 years!
  • Sadly, capping the addition of new medical debts at $500 means a lot will still be out there on credit reports.
  • This does nothing to stop extraordinary collections tactics like calls, letters, lawsuits, liens on homes, garnishing of wages, etc.
  • To free people from the burden of medical debt we must rebalance the relationship between patients, insurers and providers. What one pays for essential health care must be reasonable given their economic circumstances.
  • No one should skip care or undermine their fiscal security because they happen to be diabetic or have been diagnosed with cancer or have been in an accident

New York, NY – Friday, March 18 – Undue Medical Debt (RIP), the 501(c)(3) that uses donated funds to abolish medical debt for people in financial need, celebrates the news this morning from TransUnion, Equifax & Experian that a majority of medical debts on credit reports will be removed come July but supports further, federal change to protect patients from harmful medical debts landing on their credit reports. 

Undue supports action by Congress and agencies like the Consumer Financial Protection Bureau to develop more robust rules to regulate medical debt.

Medical debt is destructive and upends lives every day. Most people in the U.S. are one accident or illness away from financial ruin. For this reason, when Undue abolishes debts, it ensures any negative marks on credit are removed.

The state of medical debt:

  • From the Kaiser Family Foundation last week: Americans owe at least $195 billion of medical debt despite more than 90% of the population being insured 
  • From the CFPB, more than half of all collection activity in the US is for medical debt 
  • From the American Cancer Society: half of patients surveyed had medical debt related to their cancer treatment and half of that group had debt reported to collections and reflect on their credit reports 

“It is exciting to see medical debt being recognized as different from other kinds of debt by the consumer credit reporting agencies,” shares Allison Sesso, Undue ’s CEO. “We know from the 3.6 million people whose debt we relieved that these are debts of necessity, incurred to obtain treatments necessary to maintain physical and mental wellbeing. Even calling these ‘debts’ is questionable given how they are built into our health care finance system; they are not a good indication of someone’s credit worthiness. We support this proactive action on the part of TransUnion, Experian and Equifax and are in favor of additional measures that remove medical debts from credit reports.”

This action from the three credit agencies includes:

  • Removing tens of billions of dollars’ worth of medical debt (70%) from credit reports
  • New medical debts that aren’t paid will take a year (up from 6 months) to reflect on credit reports after being sent to collections
  • In the first half of next year the plan is to remove medical debts under $500 from credit reports 

These changes will be impactful as we know from the Federal Reserve that even pre-pandemic in 2017 almost half of Americans couldn’t afford an unexpected expense of $400. 

RIP’s focus has always been centered on the patient and while this news is a great step in the right direction, we believe further policies should be enacted to protect people. Medical debt should not be used in the calculation of one’s credit score and broader reforms are needed to protect patients from the harms of medical debt. 

One recipient of our debt relief, Deanna from Florida, shared with us, “I can’t even get a new bank account because of how bad my credit is from medical bills. Thank you, thank you, all I can say is thank you. I can’t believe it, you made my year, you made me cry happy tears that haven’t happened for me in such a very long time.” 

And Sharita from Oklahoma shared, “Receiving this information is so amazing to me I had just recently made a two-year plan for myself to raise my credit so I can get myself a house & getting all these debts off my credit so for this to be taken off as a gesture is the greatest thing ever, it’s such a difference in my life that I will never forget!”