Earning an MBA from Wayne State University, Renell Shorter embarked on an entrepreneurial career that has spanned nearly two decades. Renell “Rae” Shorter leads Credit Diva of Dallas, a Texas-based financial literacy and consulting firm that helps clients understand credit reports and improve their credit scores.

In the United States, medical debt is one of the leading causes of bankruptcy and low credit scores. However, the American health insurance and medical billing systems are complex, and occasionally some of these bills are erroneously issued or incorrectly reported to collection agencies. When this happens, individuals can be unfairly penalized on their credit reports for errors they didn’t make. 

Recognizing the complications of the health system, the three major credit agencies (Experian, Equifax, and Transunion) recently announced that they will not display medical debts on credit reports until the debts are more than 180 days past due. This gives consumers a six-month grace period to clear up any billing errors or straighten out miscommunications with their insurance companies. 

After six months, however, any outstanding medical debt may appear on an individual’s credit report. Once listed on the report, the debt can appear for up to seven years after the bill has been settled.