Consumer Reporting: Medical Debt

Summary of State Laws Prohibiting the Reporting of Medical Debt

‍

Medical debt affects millions of Americans, often resulting from unexpected healthcare costs. As of 2024, approximately 15 million Americans owe an estimated $49 billion in medical debt, according to the Consumer Financial Protection Bureau (CFPB). Medical debt can lower credit scores, impacting access to loans, housing, or employment. Proponents of reporting restrictions argue that medical debt is less predictive of creditworthiness and often inaccurate, while critics, including some in the credit industry, contend that excluding it reduces the transparency of credit assessments.

‍

Though the CFPB’s “Medical Debt Rule” is currently being litigated, several states have enacted laws to limit how furnishers—such as healthcare providers or debt collectors—and consumer reporting agencies (CRAs) like Equifax, Experian, and TransUnion report medical debt. This blog post summarizes these state-level restrictions.

Customers should ensure that their background screening providers are not reporting medical debt in states where it's restricted.

‍

State-Specific Laws and Bills

‍

California

California’s Senate Bill 1061 (SB 1061), effective January 1, 2025, prohibits CRAs from including medical debt in consumer reports. Medical debt reported in violation is void and unenforceable. The law excludes debt charged to medical or general credit cards, a loophole noted by critics. It also requires hospitals to maintain debt records and mandates specific terms in contracts for debt assignment or sale.

• Link to SB1061

‍

Colorado

Colorado’s House Bill 23-1126, effective August 6, 2024 until July 1, 2028, prohibits debt collectors from falsely claiming medical debt will appear on credit reports unless it exceeds the national conforming loan limit (e.g., $766,550 in 2023). CRAs are also barred from reporting medical debt below this threshold. 

• Link to HB23-1126

‍

Connecticut

Connecticut’s Senate Bill 395, effective July 1, 2024, prohibits health care providers from reporting any portion of a medical debt to a credit rating agency for use in a credit report. Any portion of a medical debt that is reported to a credit rating agency shall be void.

• Link to SB395

‍

Illinois

Illinois’s Medical Debt Reporting Act (Public Act 103-0583), effective January 1, 2025, prohibits CRAs from including medical debt in consumer reports and bars furnishers from reporting such debt.

• Link to SB2933 Public Act 103-0648

‍

Maine

Maine’s LD 558, signed into law on June 9, 2025, amends the Maine Fair Credit Reporting Act to prohibit medical creditors, debt collectors, and debt buyers from reporting medical debt to CRAs. 

• Link to LD 558

‍

Maryland

Maryland’s House Bill 1020 (HB 1020) effective October 1, 2025, prohibits furnishing of medical debt information to CRAs and prohibits CRAs from including medical debt information in consumer reports. It also prohibits the use of medical debt information included in a report to make determinations of a consumer’s creditworthiness.

• Link to HB 1020

‍

Minnesota

Minnesota’s Secretary of State, Filed 4097 (SF 4097), effective October 1, 2024, prohibits a collecting party from reporting medical debt to a CRA, and prohibits a CRA from making a consumer report containing an item of information that is known or should be known concerns medical debt.

• Link to SF 4097(section 79. [332C.03]

‍

Nevada

Nevada’s Senate Bill 248 (SB 248), effective 2021, requires collection agencies to give a 60-day notice of medical debt to the debtor. During those 60 days, medical debt may not be reported to CRAs. Otherwise, Nevada does not prohibit CRAs from reporting medical debt. 

• Link to SB 345: Nevada Legislature - SB 345

‍

New Jersey

New Jersey’s Assembly Bill 3861 (AB 3861 Louisa Carman Medical Debt Relief Act), effective July 22, 2024, prohibits a CRA from making any consumer report containing a patient’s paid medical debt or a medical debt of less than $500 regardless of the date it was incurred. It also prohibits medical creditors or medical collectors from furnishing medical debt to any CRA.

• Link to AB 3861

‍

New York

New York’s Senate Bill 4907 (SB 4907), effective December 13, 2023, prohibits hospitals, health care professionals, and ambulance service from furnishing medical debt to a CRA. Likewise, CRAs are prohibited from reporting or maintaining medical debt in a file.

• Link to SB 4907

‍

Oregon

Oregon’s Senate Bill 605 (SB 605) effective January 1, 2026, prohibits furnishing of medical debt information to CRAs and prohibits CRAs from including medical debt information knowingly or reasonably should know in consumer reports.

• Link to SB 605

‍

Rhode Island

Rhode Island’s Senate Bill 2709 (SB 2709), effective January 1, 2025, prohibits hospitals and debt collectors from furnishing medical debt to CRAs. No credit reporting agency shall make a consumer report containing any adverse information that the agency knows or should know is related to medical debt of a consumer.

• Link to SB 2709

‍

Washington

Washington’s Engrossed Substitute Senate Bill 5480 (ESSB 5480), signed into law on April 22, 2025, and effective July 27, 2025, prohibits healthcare providers, their professional partners, and collection agencies from reporting medical debt in consumer reports. Medical debt is defined as any amount owed for medical services, products, or devices, excluding cosmetic surgery unless reconstructive following trauma or illness. 

• Link to SB5480

‍

Vermont

Vermont’s Senate Bill 27 (SB 27) effective July 1, 2025, prohibits CRAs from reporting medical debt information or maintaining medical debt information in a consumer’s file and forbids large health care facilities and medical debt collectors from reporting medical debts to consumer reporting agencies.

• Link to S.27

‍

Virginia

Virginia’s House Bill 1370 (HB 1370), signed April 8, 2024, prohibits certain health care providers, medical care facilities, health care professionals, emergency medical services agencies, and collection entities from reporting any portion of a medical debt to a CRA.

• Link to HB 1370

‍

We will continue to monitor these changes as they relate to Entrata and its customer base and encourage clients to reach out to their Entrata representative with any questions.

‍