On January 7, 2025, the Biden-Harris administration announced a final rule eliminating all medical debt from credit reports. Historically, medical bills have been a leading cause of debt, with the Consumer Financial Protection Bureau (CFPB) estimating that in 2022, medical debt made up $88 billion of reported debts. In 2023, policies from major credit agencies (TransUnion, Experian, and Equifax) removed medical debt under $500 from reports. Building on these incremental policy changes, this new rule will completely erase medical debt from credit reports, presenting challenges for physicians. 

Physicians now face greater difficulty collecting payments directly from patients, as high-deductible health plans have shifted more financial responsibility to individuals. According to the Kaiser Family Foundation, patient deductibles have increased by more than 150 percent over the past decade. This trend has resulted in a rise in insured patients unable to meet their financial obligations, contributing to an increasing amount of bad debt that physicians must manage.  

With unpaid medical bills no longer affecting patients’ credit scores, these debts have become a lower priority for repayment. This situation has raised concerns among physicians, especially given the already reduced Medicare reimbursement rates. Concerns are also emerging in other sectors, with the Consumer Data Industry Association and the Cornerstone Credit Union League filing suit to delay this ruling.  

For expert insights and opinions on this final rule, listen to our latest Zotec Answers episode now.  

We will continue to monitor this development and provide updates as the situation unfolds.  

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