A credit score that ignores the innocuous mistake

  • Article by: Tara Siegel Bernard , New York Times
  • Updated: May 13, 2013 - 10:37 AM

VantageScore is ignoring collection actions on credit reports as long as they are paid. Most collections are tied to medical bills.

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swmnguyMay. 12, 13 9:42 AM

This is a fascinating story, as much for what it only alludes to as for what it discusses in detail.

First off, it's obvious that a huge number of Americans are in financial trouble due solely to the collapse of the Health Care Finance system. If there were fewer potentially credit-worthy consumers caught in this pitfall, it wouldn't be worth it to the Finance Industry to identify them and distinguish them from those who are truly not credit-worthy.

It also highlights the complete incompetence and irresponsibility of the Finance aspect of the health care industry. If you point out an error in billing, they routinely direct you to a Collections Agency? That's obvious malicious retaliation and extortion, since they know perfectly well that a referral to Collections will harm your credit rating, discouraging people from pointing out errors in billing. And indeed, errors in billing, or mis-coding errors for insurance, are the main issue in medical billing problems.

It's interesting that now the credit industry is realizing that the medical finance industry is such a disaster that it needs to be discounted from credit evaluation.

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