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HB 1020

Consumer Protection - Credit Reporting - Medical Debt (Fair Medical Debt Reporting Act)

2025 Regular Session Introduced by Julie Palakovich Carr

Maryland law prohibits credit reporting agencies from including medical debt on credit reports and using it in credit scores, protecting consumers from credit damage due to medical expenses.

Approved by the Governor - Chapter 121
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Bill Summary · HB 1020

Legislative bill overview

HB 1020 prohibits consumer credit reporting agencies from including medical debt on credit reports and prevents medical debt from being used as a factor in credit scoring calculations. The bill became law in Maryland on April 22, 2025, with gubernatorial approval.

Why is this important

Medical debt is a leading cause of personal financial hardship in the United States, often resulting from unexpected healthcare costs rather than financial mismanagement. This law shields Maryland consumers from credit score damage due to medical expenses, potentially improving their ability to obtain loans, housing, and employment without the collateral damage of unpaid medical bills.

Potential points of contention

  • Healthcare provider collections: Medical providers and collection agencies may face reduced leverage in collecting unpaid medical bills, potentially increasing write-offs or changing collection practices
  • Credit risk assessment: Lenders argue that removing medical debt information makes credit scoring less predictive of actual default risk, potentially leading to higher interest rates for all borrowers or reduced credit availability
  • National inconsistency: Maryland's unilateral action creates a patchwork system where credit bureaus must maintain different reporting standards by state, increasing compliance complexity and costs

Compiled from official sources — confirm details with the bill’s official record.

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