You have your medical insurance, and you have done everything right. You have paid your premiums on time, you have brought your card to the hospital, and you have paid the deductibles. However, when the doctor claims the insurance company to recover costs, they refuse to pay.

But the doctor wants money, so he is after you.

This is common case reported everyday, and such medical collections can affect your credit score adversely. This, however, isn’t your fault at all. So, should this still affect your score? As of now, they are counted like any other unpaid debt, and affect your score equally.

Consumer is not at fault, clearly. He believes that these costs shouldn’t be reported to the bureau as he has already paid the insurance company. It’s now the insurance company’s responsibility to repay the bills.

The credit bureau, however, is not concerned with ‘why’ it happened. If the money is not repaid, your credit loses some points. Simple rule.

FICO may address this problem with FICO 08, which doesn’t count any collections below $100. But is it enough? It obviously is not.

The credit bureau must play a vital role in such situation and get the issue resolved. If the consumer is not liable to repay the debt, why should his score be affect in the first place. This is not a small case. It may ruin consumer’s life.

According to Medical Debt Relief Act, bureaus are requested to remove medical collections that has been settled or paid. Hence, consumer wins this case, but most lenders are at loss because they depend on accurate credit reporting to make lending decisions.

Besides, the doctor who is still unpaid is at loss. In his opinion, you are at fault, and you should be held responsible for non-payment of the bill. He is not concerned about ‘why’ the insurer didn’t pay. All he wants is his money.