Two years ago, my cousin James had surgery after an unexpected accident. He recovered well — but when the hospital bill arrived, it was over $8,000. He didn’t have insurance at the time and thought, “Maybe if I ignore it, it’ll go away.”
It didn’t.
Within months, he started getting collection calls. Later, his credit score dropped by more than 100 points, and he couldn’t qualify for a car loan.
If you’ve ever wondered what really happens when you don’t pay medical debt, this guide explains everything — step by step — so you can protect your finances and your future.
What Is Medical Debt?
Medical debt happens when you receive healthcare services and can’t pay the bill right away. This includes hospital stays, doctor visits, lab tests, or even ambulance rides.
According to the Consumer Financial Protection Bureau (CFPB), over 100 million Americans currently carry some form of medical debt. And about 1 in 5 households report struggling to pay their medical bills.
Medical debt is different from other types of debt because:
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It often comes from emergencies, not poor spending habits.
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It’s not always reported right away to credit bureaus.
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You may have options to negotiate or reduce what you owe.
What Happens If You Don’t Pay Your Medical Bills?
Let’s break down what typically happens — and how long it takes — if you fail to pay your medical debt.
| Stage | What Happens | Timeline |
|---|---|---|
| 1. Unpaid Bill Notice | You get reminders or late notices from the hospital or clinic. | 30–90 days after the due date |
| 2. Internal Collections | The provider’s billing department calls or emails you about payment options. | 60–120 days |
| 3. Sent to Debt Collector | The debt is sold or assigned to a collection agency. | 90–180 days |
| 4. Credit Report Impact | The unpaid debt may appear on your credit report after 1 year (as of new 2023 rules). | 1 year or more |
| 5. Legal Action | The collector may sue you for payment or garnish wages if ignored. | 6–24 months |
Note: Since July 2022, Equifax, Experian, and TransUnion no longer include paid medical debt on credit reports — and unpaid medical debt under $500 is now excluded (source: Consumer Financial Protection Bureau).
Case Study #1: Ignoring a Hospital Bill
Case: Sarah, a 32-year-old nurse, ignored a $1,200 emergency room bill after losing her job.
Result: After 8 months, the debt was sold to a collector. The agency added fees, raising the total to $1,600. Her credit score dropped by 85 points.
Lesson: Ignoring bills can make the balance grow due to collection fees and potential legal costs.
Can You Go to Jail for Unpaid Medical Debt?
No — you cannot go to jail for unpaid medical debt in the U.S.
However, if a court orders you to appear and you ignore the summons, that could lead to legal consequences.
Some states even allow wage garnishment or bank account levies after a judgment is entered.
Tip: Always respond to court notices. Even if you can’t pay, showing up may give you a chance to set up a payment plan or negotiate.
How Medical Debt Affects Your Credit
Medical debt doesn’t hurt your credit immediately. Under new credit reporting rules:
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You have 1 full year to pay or resolve the debt before it appears on your credit report.
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Paid medical collections no longer appear at all.
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Debts under $500 are excluded from all major credit reports.
Still, if the debt remains unpaid and goes to collections, your credit score can drop 50–150 points, depending on your current score.
Case Study #2:
David owed $4,200 for knee surgery. After nine months of missed payments, the account was sent to collections. His credit dropped from 720 to 580. When he later applied for a mortgage, he had to pay higher interest rates due to the lower score.
Options If You Can’t Pay Your Medical Debt
Before it reaches collections, you still have several ways to reduce or manage your medical debt.
1. Ask for an Itemized Bill
Billing errors are common. According to Medical Billing Advocates of America, up to 80% of hospital bills have mistakes. Request a detailed breakdown and check for:
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Duplicate charges
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Incorrect procedures
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Services you didn’t receive
2. Negotiate the Bill
Hospitals often offer “prompt pay discounts” or charity care programs. You can say something like:
“I want to pay, but I can’t afford the full amount. Can we discuss a reduced payment or a hardship plan?”
3. Apply for Financial Assistance
Nonprofit hospitals are required by law (IRS Section 501(r)) to provide charity care or financial aid for low-income patients.
4. Set Up a Payment Plan
Ask for zero-interest monthly payments directly through the provider before it’s sent to collections.
5. Get Help from Credit Counselors
Reputable organizations like the National Foundation for Credit Counseling (NFCC.org) can help you organize payments and negotiate on your behalf.
Comparison Table: Ignoring vs Managing Medical Debt
| Action Taken | Outcome | Impact on Credit | Future Consequences |
|---|---|---|---|
| Ignore the debt | Goes to collections, adds fees | -80 to -150 points | Harder to get loans or rent |
| Set up payment plan | Avoids collections | Neutral or positive | Builds trust with providers |
| Negotiate or settle | Debt reduced or forgiven | Minor score drop | Less financial stress |
| Apply for charity care | Debt canceled if eligible | No impact | Keeps credit healthy |
Case Study #3: Negotiating Instead of Ignoring
Case: Maria, a single mom from Ohio, received a $3,500 hospital bill after childbirth. Instead of ignoring it, she contacted the hospital’s billing office.
Result: They offered a 30% discount and a 12-month no-interest plan. She paid it off within a year and avoided collections entirely.
Lesson: Communication is key — hospitals prefer small payments over no payments.
Steps to Take If You Already Have Medical Debt in Collections
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Confirm the debt is yours. Request written validation within 30 days of notice (Fair Debt Collection Practices Act).
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Negotiate a settlement. Ask if they’ll remove the entry from your credit report upon payment (“pay for delete”).
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Monitor your credit report. Check AnnualCreditReport.com to make sure paid debts are removed.
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Avoid new debt. Focus on high-interest debts last — prioritize medical bills that can affect your legal or credit standing.
Expert Insight
“Most people don’t realize medical providers are often flexible. It’s always better to call and ask for options before collections get involved.”
— Dr. Michael Kent, Health Policy Analyst at Johns Hopkins University
Final Thoughts: Don’t Ignore It — Face It Early
Medical debt is stressful, but ignoring it only makes things worse.
Whether it’s $500 or $5,000, contact your provider early, verify your bill, and explore payment options.
Like my cousin James learned — it’s not about avoiding the debt, it’s about managing it wisely before it damages your credit or peace of mind.