Medical debt-- large, necessary expenses that can wheedle their way into collections without the consumer even realizing they ever existed-- is the bane of many a credit score. Because of this, and because of the peculiar way medical debts are incurred (compared to, say, a voluntary Target Card), FICO is deemphasizing the effect these have on credit scores.
This is good! Medical debt is often the result of unlucky circumstance, and beyond its value in a basic income-to-debt ratio measurement, is very rarely a reflection of a consumer's general creditworthiness.
After all, it's not as if people take willy-nilly trips to the emergency room, rack up a couple grand in outpatient fees, and then skip and whistle happily into the distance while reflecting wistfully on how they wish they had better spending habits. Sometimes you get hit by a car. Sometime your discs herniate. Often the very medical problem you're supposed to pay to treat can limit your ability to work either temporarily or permanently, resulting in a billable Catch-22. It's not rocket science, and FICO understands this, which is why it's making the logical decision to change to lower the impact of medical debt in its credit scoring model.
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