Beginning this Sunday, July 27, Washington state will officially ban the reporting of medical debt to credit agencies, a move that could bring financial relief to thousands of residents carrying healthcare-related bills on their credit records.
The change comes as part of Senate Bill 5480, a consumer protection measure signed into law earlier this year. Under the new rules, medical debt, whether from hospital stays, emergency visits, or the purchase of medical equipment like wheelchairs or oxygen tanks, can no longer be used to influence a person’s credit score.
“This law is about recognizing that medical debt isn’t like other types of debt. People don’t choose to get sick,” said State Senator Marcus Riccelli, who sponsored the bill.
The law prohibits credit bureaus and licensed collection agencies from including medical debt in consumer credit reports. Any such debt already reported must be removed, and future attempts to report it will be considered a violation of the state’s Consumer Protection Act.
For residents across Washington, this could mean a bump in credit scores, potentially opening doors to better loan rates, rental agreements, and job opportunities. Medical debt has long been a leading cause of financial strain in the state, with many families unable to absorb even a few hundred dollars in unexpected healthcare expenses.
In addition to credit relief, the law introduces stronger oversight for how medical debt is handled overall. Healthcare providers, hospitals, and billing services must clearly inform patients that such debts cannot be reported to credit agencies. If they fail to include this information in contracts or billing statements, the debt may be deemed legally void.
The legislation arrives at a time when national policies around medical debt remain in flux. Although federal regulators have pushed to remove medical debt from credit scoring models nationwide, legal challenges have slowed implementation. Washington’s new law ensures statewide protections regardless of federal developments.
Critics of the measure, including some in the debt collection industry, argue that the change could undermine accountability and make it harder to assess financial responsibility. Supporters counter that credit scores should not be weighed down by debts that stem from medical emergencies or system-driven billing errors.
As the law takes effect, drivers and renters alike may soon notice their credit reports shifting, especially those who’ve struggled under the burden of medical bills. State officials encourage consumers to monitor their credit reports closely in the coming months and report any violations of the new law.
For many Washingtonians, this marks a long-awaited step toward fairness in a healthcare system where financial stress often follows medical treatment. Come July 27, that stress will no longer be reflected on their credit scores.
