Doctor writing on a paper

What is the Statute of Limitations on Medical Debt?

Do you have medical debt? You might have heard of the statute of limitations – it’s a legal rule that prevents creditors from pursuing you for payment. Read this article to learn everything you need to know about the statute of limitations on medical debt.

What is a Statute of Limitations?

A “statute of limitations” refers to the amount of time that a creditor has available to take legal action against you for non-payment. When it comes to debts, once this period of time runs out, the creditor no longer has the right to take legal action against you. Understanding what a statute of limitations on medical bills is will be important in protecting yourself from these debts.

So for example, say you owe money to a healthcare provider, such as a hospital. The amount of time available for the hospital to sue you is going to depend on the statute of limitations for the state. This time period typically varies from state to state across the United States. The creditor may still attempt to chase you, and even bring lawsuits against you. However, you can use the statute of limitations against these creditors by bringing it up as a defense against them in court. 


The Commonwealth Fund recently conducted a survey, which found that it is not uncommon for people to be struggling to pay their medical bills and that medical debt accumulates over time. 41% of Americans of working age—amounting to 72 million people—said that they were paying off medical debt or struggling with medical bill issues. This is a significant climb over 34% in 2005.

A recent report has also found that more than half of all working-age adults who learn less than $40,000 per year reported having problems paying their medical bills or reported that they are in debt due to medical expenses. Adults who lack insurance or who lack adequate insurance are at a greater risk of having medical debt than those who have adequate insurance coverage.

Statute of Limitations for Medical Debt

Is there a statute of limitation on medical bills? Yes, but there’s more to it.

The statute of limitation on medical bills is going to differ depending on which state you live in. It is important for you to keep in mind that most medical bills essentially represent a written contract. This contract exists between you and the medical provider. Medical providers typically choose to create a written document that is signed by both the borrower (you) and the lender (the medical provider). 

This is because they are legally binding and easier for the medical provider to enforce. This document forms the basis of the contract. Medical providers, such as doctors and hospitals, will require that new patient’s sign such a document. It is typically referred to as a new patient financial responsibility form. 

This document will serve as the written contract between the parties. Because the medical debt is contract-based, the statute of limitations is based on contract law as well. 

Statutes of limitations vary significantly from state to state. The lowest statute of limitations for medical debt contracts is in North Carolina at only three (3) years. The highest statute of limitations is Ohio at fifteen (15) years. The specific statute of limitations for your situation is based on the state where you live. picture of Stethoscopes

How Do You Avoid Paying Until the Statute of Limitations Run Out?

Statutes of limitations can be restarted in several ways. Make sure to avoid restarting your statute of limitations in the following ways:

  • Any time that you acknowledge that you owe the debt.
  • Any time that you make or enter into a payment plan.
  • Any time that you make or enter into an agreement to pay.
  • Any time that you accept a settlement offer.

You will have to rely on your own records in keeping up with the statute of limitations for your debts. Make sure to keep track of your (1) payments, (2) dates of payments, and (3) communications with creditors. This information will help you track your statutes of limitations.

The statute of limitations pertaining to medical debt will not extinguish your obligation once it has expired, so you will still owe the money. A collection agency can attempt to collect a medical debt indefinitely. The medical debt will not go away unless it has been paid or discharged by way of bankruptcy.

After the statute of limitations has run, a collection agency can compel you to make a payment. It does this by reporting the amount you owe to the credit bureaus, which will negatively impact your credit score.

Any negative information present on your credit report will automatically expire. This happens seven years from the date of the first delinquency. A collection agency will begin contacting a consumer following the 30-day past due period to inquire about the account. Once it reaches the 60-day past due mark, the collection agency is likely to report the borrower as being delinquent. Once the account is past due beyond sixty (60) days, it is possible the collection agency may sell the debt to a third-party debt collector.

What are the Alternatives to Letting the Statute of Limitations Run Out?

File for Bankruptcy

Once you file for bankruptcy an automatic stay will go into effect. This will automatically stop all collection activities against you. 

However, there are consequences that come with going bankrupt. You will have to be prepared to go through these consequences. Your credit score will take a significant hit and it will take time and work to come back from it. 

Debt Settlement

If you have a lot of debt, debt settlement is an option for you. This will help you negotiate settlements through payments that are less than what you owe. 

However, it is important to know that debt settlement opportunities can do more harm than good. You may experience damage to your credit. Debt settlement companies may encourage you to stop making payments while arranging a lump sum payment which can create additional delinquencies. Try to avoid options that further harm your credit report.

Get Medical Insurance

Having adequate medical insurance in the first place will help you avoid owing too much. Proper medical insurance will help you reduce your medical costs

Urgent care centers typically handle problems that require immediate attention. These are ideal for non-life-threatening health issues. 

Retail health clinics are ideal for convenient, routine health care. Walk-in doctor’s offices can provide you will simple medical care quickly. 

Choosing the right type of care is essential. However, it begins with adequate medical insurance. Doctor holding a clipboard

Final thoughts

No one wants to bail on their obligations, but if you’re facing a mountain of medical debt then knowing what the statute of limitations is on the medical debt could just be a lifesaver. In summary, you’ll need to check what the specific rules are in your state – exactly how many years does it have to be before you’re in the clear? Working that out could give you more peace of mind.

In the meantime, make sure you don’t take any actions that will restart the clock on your statute of limitations. Remember, you also have other avenues of dealing with the debt like filing for bankruptcy, working out a settlement plan, etc. 

Do you have medical debt? Have you successfully avoided paying most of your medical debt? Share your experiences with us in the comments!

Leave a Comment

Your email address will not be published. Required fields are marked *