Models Will No Longer use Any Medical Collection Information in Score Calculations Regardless of Age or Amount Owed

Stamford, CT (August 10, 2022) — Having already eliminated paid medical collection accounts with the introduction of VantageScore 3.0. in 2013, VantageScore has been the leader in recognizing that medical debts and collections that have been paid off are not predictive of a consumer’s creditworthiness.

Today, VantageScore is announcing further steps in supporting consumers affected by medical collection debt. VantageScore completed an extensive analysis of how consumer credit score models are impacted by recent changes to how medical collection accounts are reported, including changes brought about by the COVID-19 pandemic. Based on the findings, VantageScore has made the decision that neither of its most recently introduced scoring models (VantageScore 3.0 and 4.0) will continue to use this data in the calculation of consumers’ credit scores, regardless of the amount owed or the age of the collection.

VantageScore expects the adjustment to the models will be completed and operational by mid-October of this year.

As a result of this decision, VantageScore estimates consumers with this type of information in their credit files will likely see scores increase by as much as 20 points when either the VantageScore 3.0 or 4.0 models are used. Impacts to model performance are expected to be minimal for a large segment of the population, according to the analysis.

43 MILLION CONSUMERS: According to a Consumer Financial Protection Bureau report released on March 1, 2022, medical collection accounts appear on 43 million credit reports and approximately 58% of bills that are in collections and on people’s credit records are medical bills as of the second quarter of 2021. 

FUTURE REMOVAL OF MEDICAL DEBT: By 2023, 75% of medical collections will be removed and VantageScore is taking advantage of the opportunity to reassess the predictive value of using this information in its credit scoring models.

MINIMAL PERFORMANCE IMPACT: Impact to the VantageScore models’ predictive performance is expected to be minimal for a large segment of the population and both VantageScore 3.0 and 4.0 will continue to rank order effectively.

“Across our credit scoring models, medical collections accounts have minimal impact on the predictiveness of creditworthiness for a large segment of the population. As such, we are making the proactive decision to remove the information from our models entirely,” said Silvio Tavares, President and CEO of VantageScore. “Our decision reflects VantageScore’s continued effort to offer the most predictive scoring models and to help increase financial inclusion,” he concluded.

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