Medical Debt May Prevent You From Getting Hired
Most people are aware that their credit score and history will be taken into account when they apply for things like a new loan or credit card, but did you know that potential employees may legally use your credit score to determine whether or not to hire you? This is important information to consider for a number of reasons, not least of which is the fact that medical debt could potentially be keeping you from getting hired.
Employers Use Credit Score To Judge Character
As many as 47% of all employers use credit scores as part of the hiring process. Those who do argue that assessing a person’s total character means taking into account their financial history, and whether a potential job candidate has any major outstanding debt. When a person has a low credit rating, there may be a number of reasons, including periods of economic distress or major illness.
Legislation to Amend Credit Reporting and the Hiring Process
Some argue that the process of including credit scores when considering whether to hire a person is unfair. Many legislatures argue that when a person has a negative mark on their credit, it may be the result of a period of unemployment or another financial emergency.
It may also be the result of a medical emergency that occurred when a patient was uninsured or underinsured. In cases like this, even a very financially responsible person may find themselves buried in debt and unable to pay their bills on time.
Legislators like Senator Elizabeth Warren from Massachusetts are attempting to pass a law called the Equal Employment for All Act. The law would change the fact that employers may use credit scores to make decisions about hiring and only allow scores to be considered in the case of jobs that require national security clearance, where a person’s full profile would reasonably still be required.
Medical Debt the Most Common Kind of Debt
The issue of credit scores, hiring processes, medical debt are all highly related, as the most common type of debt is from medical bills, many of which may be affecting a person’s credit history in error. As many as 41 million Americans report having been contacted by a collection agency about medical bills. 7 million Americans have been contacted by a debt collection agency because of a bill that contained an error. Nearly half of all bills that are sent to a collection agency are medical bills.
Confusion and Errors Send Bills to Collections
One reason that such a large number of bills are sent to collections is that many patients experience confusion with their bill. They may be surprised to learn that their insurance company has not covered part of their bill that they expected to have covered or there may be an error on their bill that they are attempting to have fixed.
In the process of sorting out the legitimacy of the charges on a bill, a patient’s bill may be sent to collections, at which point it will negatively affect their credit rating. Once a bill has been sent to collections and appears on an individual’s credit report, it can be very difficult to have it removed. Some individuals may be facing so many bills and so confused and overwhelmed by bills that they do not even know that some of their bills have gone to collections.
If you have a bill that you believe has mistakes on it, make sure you communicate with your hospital’s billing staff. Do not allow a bill to go to collections and jeopardize your chances of gaining employment.
Learn more by reading our comprehensive medical billing guide.