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Medical Collections Under $500: What the NCRA Rule Actually Does in 2026

Since April 2026, unpaid medical collections with an initial balance under $500 don't appear on consumer credit reports under the voluntary NCRA policy adopted by Experian, Equifax, and TransUnion. The CFPB's broader 2026 rule was vacated by a federal court in July 2026, but the NCRA changes survive. Here is what is in effect, what isn't, and what to do if old medical items still show on your report.

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Two things to know up front. First, unpaid medical collections with an initial reported balance under $500 do not appear on your consumer credit report — that has been true since April 1, 2023, and it is still true in 2026. Second, that protection comes from a voluntary policy of the three nationwide credit reporting agencies (Experian, Equifax, TransUnion), not from a CFPB rule. The CFPB's broader medical-debt rule from January 2025 was vacated by a federal court in July 2025. The NCRA voluntary changes survived the vacatur and are what's in effect today.

This article walks through what the NCRA rule actually covers, the full 2022-2023 timeline, why the CFPB rule was vacated, how the two interact, what state laws layer on top, and what to do if a paid or under-$500 medical item is still showing on your report.

The NCRA Voluntary Changes Timeline

The three nationwide credit reporting agencies announced a joint policy in March 2022. The changes rolled out in two phases.

Effective July 1, 2022:

All paid medical collection accounts were removed from consumer credit reports and do not appear going forward.
The waiting period before a new unpaid medical collection can appear on a report was extended from 180 days to 12 months, giving consumers more time to work with insurers, providers, and billing-error processes before the debt hits their file.

Effective April 1, 2023:

All unpaid medical collections with an initial reported balance under $500 were removed from credit reports and do not appear going forward.

These are voluntary actions by the bureaus, not statutory requirements. Either bureau could change the policy at any time, but no bureau has signaled an intent to reverse it. The CFPB confirmed the practical effect in (https://www.consumerfinance.gov/about-us/blog/medical-debt-anything-already-paid-or-under-500-should-no-longer-be-on-your-credit-report/): paid medical collections and unpaid-under-$500 medical collections should no longer be on your report.

What "Under $500" Actually Covers

The threshold is the initial reported balance of the medical collection, not the current balance after any partial payments. A $480 unpaid collection that has accrued interest to $540 still falls under the rule, because the initial reported balance was under $500.

The rule applies to collections only — debt that has been turned over to a third-party collector or charged off internally and reported as a collection tradeline. It does not apply to:

Direct billing from a hospital or doctor. Those have never appeared on credit reports.
Medical credit cards (like CareCredit) that report as standard revolving accounts. Those follow ordinary FCRA tradeline rules.
Medical collections of $500 or more, paid or unpaid (the $500-and-up unpaid items still appear after the 12-month delay; the $500-and-up paid items were removed in the July 2022 phase).

In short, the rule eliminated two specific categories: any paid medical collection, and any unpaid medical collection that started under $500. Together those represent roughly 70% of the medical-collection tradelines that existed before the changes, per the CFPB's data spotlight.

The CFPB 2025 Rule and Why It Was Vacated

The CFPB tried to go further. In January 2025, the Bureau finalized a rule under (https://www.federalregister.gov/documents/2025/01/14/2024-30824/prohibition-on-creditors-and-consumer-reporting-agencies-concerning-medical-information-regulation-v) (published at 90 FR 3276) that would have:

Banned creditors from using medical financial information in credit decisions.
Banned consumer reporting agencies from including any medical debt collection tradeline on a consumer report, regardless of amount or paid status.

The rule's stated effect was to remove an estimated $49 billion in medical debt from the credit files of roughly 15 million Americans. It was scheduled to take effect 60 days after Federal Register publication.

The rule was challenged in Cornerstone Credit Union League v. CFPB. On July 11, 2025, the U.S. District Court for the Eastern District of Texas vacated the rule on a joint motion of the parties. The court agreed that the rule exceeded the Bureau's statutory authority and conflicted with the Fair Credit Reporting Act, because the FCRA already authorizes the reporting of coded medical debt information that the rule purported to prohibit.

What this means today: the broader CFPB rule is not in effect. The under-$500 NCRA voluntary policy is what's still in force. Medical collections of $500 or more — paid or unpaid — would have been removed under the CFPB rule and are still removable today only if they are paid (the July 2022 NCRA change) or if state law removes them.

State Laws That Layer on Top

Several states have enacted statutes that prohibit medical-debt reporting more broadly than the NCRA policy. The list is growing. Colorado, New York, Illinois, Virginia, and a handful of others have laws on the books in 2026. State laws survive the CFPB rule's vacatur because they operate independently of the federal rule and rely on state consumer-protection authority. If you live in one of those states, the protection is broader than the NCRA floor.

Check your state attorney general's consumer-protection page for the current state of medical-debt reporting law where you live. A bureau that violates a state-level prohibition is exposed to the state's enforcement and to private actions under the state statute, even though the federal CFPB rule is gone.

Score Impact: What the Data Show

The CFPB's (https://www.consumerfinance.gov/data-research/research-reports/data-spotlight-early-impacts-of-removing-low-balance-medical-collections/) analyzed credit-bureau records before and after the NCRA changes. Two findings stand out.

First, the typical credit-score gain for an affected consumer was 10 to 25 FICO 8 points. That's a meaningful but not transformative shift for most people.

Second, the impact concentrated. Consumers whose only adverse tradeline was the medical collection saw much larger gains and frequently crossed lending thresholds — moving from subprime to near-prime, or from near-prime to prime. For that subset, the rule changed the loan products they qualified for and the rates they paid.

The rule did not change anyone's underlying medical debt. It changed only what appeared on credit reports. Consumers still owe the collector, the collector can still pursue the debt, and unpaid debts above the threshold still hit the credit file after the 12-month delay.

What to Do If a Paid or Under-$500 Medical Item Is Still on Your Report

The bureaus mostly purged old entries when the changes took effect, but some still surface. If you see a paid medical collection or an unpaid-under-$500 medical collection on any of your reports today, the fix is a free Section 611 dispute.

Pull your three reports for free at AnnualCreditReport.com. Identify the offending entry on each bureau that reports it.
File a Section 611 dispute with each bureau, online or by certified mail. The basis is the NCRA voluntary policy: paid medical collections should not appear (July 2022 policy); unpaid medical collections with initial balance under $500 should not appear (April 2023 policy). Cite the policy and the entry's specifics (date opened, balance, paid status).
The bureau has 30 days to investigate and delete the entry or explain why it remains.
Escalate to the CFPB or your state attorney general if the bureau verifies an entry that the policy clearly removes. The (https://www.consumerfinance.gov/complaint/) tracks bureau responses and the agency uses complaint data to drive enforcement.

If you are working through medical-debt recovery more broadly — late payments tied to medical bills that hit your credit before they were turned over to collections, or medical debts that ended up on a charge-off rather than a collection — the broader 7-year clock on negative items still applies. Our (/post/how-long-do-late-payments-stay-on-a-credit-report) covers the timing, and our (/post/tri-merge-credit-report-mortgage-explained) covers which bureau reports which items for mortgage lenders.

Frequently Asked Questions

Are medical collections under $500 still removed from credit reports in 2026?

Yes. The NCRA voluntary policy adopted by Experian, Equifax, and TransUnion took effect April 1, 2023, and remains in effect in 2026. Unpaid medical collections with an initial reported balance under $500 do not appear on consumer credit reports. The policy is voluntary, but no bureau has signaled an intent to reverse it.

Why was the CFPB medical-debt rule vacated?

On July 11, 2025, the U.S. District Court for the Eastern District of Texas vacated the CFPB's January 2025 medical-debt rule in Cornerstone Credit Union League v. CFPB. The court agreed with both parties that the rule exceeded the Bureau's statutory authority and conflicted with the Fair Credit Reporting Act. The NCRA voluntary policy (paid medical removed, unpaid under $500 removed) is separate and survived the vacatur.

A paid medical collection is still on my credit report. What do I do?

File a Section 611 dispute with the bureau that reports it. Paid medical collections were removed under the NCRA's July 2022 voluntary policy and should not appear. The bureau has 30 days to investigate; if it verifies the entry, escalate to the CFPB or your state attorney general's consumer-protection division.

Does the rule apply to all medical debt or just collections?

Just collections. The NCRA changes apply only to medical-collection tradelines — debt that has been turned over to a third-party collector or charged off internally and reported as a collection. Direct billing from a hospital or doctor has never appeared on a credit report. Medical credit cards (like CareCredit) report as standard revolving accounts and follow ordinary FCRA tradeline rules.

The Bottom Line

The current state of medical-debt reporting in 2026 is layered. The NCRA voluntary policy removes paid medical collections and unpaid medical collections under $500 — that's the floor. The broader CFPB rule that would have removed all medical-debt reporting was vacated in July 2025 and is no longer in effect. Several states have laws that go further than the NCRA floor; check your state AG's consumer-protection page for the current state where you live.

If a paid or under-$500 medical collection is still on your report, the fix is a free Section 611 dispute citing the NCRA voluntary policy. The bureau has 30 days to remove it. Anything past the threshold still follows ordinary FCRA retention rules and the 12-month appearance delay, and those rules have not changed.