Medical Credit Score

What Is a Medical Credit Score?

Learn About Credit ScoreA medical credit score, also known as a medFICO® score, is a fairly recent development on the credit scene and was ostensibly created to help hospitals determine an individual's credit score for healthcare and track a patient's medical credit history. Anyone who has spent time in a hospital or been treated on an outpatient basis knows charges for medical services are billed not from one source, but from a variety of sources. Medical bills aren't like utility or telephone bills, where all the different charges are itemized and presented on one statement. Medical bills are individually prepared and collected by everyone from the ambulance agency to the X-ray technician. And this is where your health and credit history become intertwined to the benefit or detriment of your credit score, depending on how quickly you're able to reconcile these debts.

A medical credit score for healthcare

Your medical credit score is intended to be the medical equivalent of the credit report that lenders look at when determining how much or how little a risk you are when you apply for credit. Just as a bank looks at your credit report when you apply for a loan, a hospital or other healthcare provider examines your medical credit score to determine how likely you are to make timely payments and repay your medical expenses. Hospitals consider medical credit scores after patients are discharged to determine how quickly debts are written off as uncollectible in the event patients are unable to pay.

From an ethical standpoint, this is fairly murky water. Even if a patient is covered by health insurance and has a good credit rating, there are several opportunities for billing mistakes to be made that directly or indirectly affect a patient's ability to pay. Also, if an insurance company doesn't pay for any part of a patient's medical expenses, a patient may not find out about it until months later. Even after a patient finds out about these expenses, it could take months of back-and-forth phone calls among the parties to resolve the issues. While this is happening, the bills can be sent to a collection agency, which will have a disastrous impact on the patient's credit score. Patients can therefore be penalized through no fault of their own.

How knowing about your credit rating helps with a medical credit score

This is yet another reason why it makes so much sense to regularly receive and review copies of your credit report from each of the three main credit bureaus. You'll be able to see any medical claims that were made on your credit report without your knowing anything about them, track and dispute any items that were reported as unpaid, and proactively challenge false claims that can adversely affect your credit rating.


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