Media pundits and a host of other commentators who focus closely upon debt relief matters in the United States have long noted that medical costs are flatly a different animal when compared with other forms of consumer debt.
Any person in Texas or elsewhere who is saddled with a painfully high level of medical debt certainly agrees with that assessment and can readily explain why such is the case.
So, too, can executives with FICO, an American public company that provides the credit scores relied upon by millions of service providers — banks, car companies, mortgage lenders, apartment owners and more — seeking information on would-be customers’ past history of dealing with debt.
FICO has in fact just recently announced that it will be looking at medical debt in a new way, with the result being that debtors with high payment exactions won’t be punished in their scores as harshly as they have been in the past.
That makes good sense, and here’s why. A consumer in hock to a car company for a pricey automobile for which monthly payments have become difficult made the decision to incur such debt. The same is generally not true of patients who go to a hospital and receive care.
In fact, many such persons had no say in the matter at all; they simply became ill and needed treatment. Moreover, many — in fact, most — patients have little understanding of or input into what a medical bill will ultimately be, especially in cases where multiple providers were involved in treatment.
According to FICO, the credit scores of persons who have only medical-related debt in their reports will rise by about 25 points.
Although that is certainly helpful, it of course does nothing to alleviate the harsh challenges that millions of Americans have paying back dauntingly high medical bills.
In many instances, people simply need legal help to deal with insuperable debt obligations. An experienced bankruptcy attorney can candidly discuss debt relief options with a client seeking a fresh financial start.
Source: CNN Money, “Got medical debt? Your FICO score may go up,” Blake Ellis, Aug. 7, 2014