People in San Diego who would like to repair their credit will be interested in some recent legislative developments in the nation's capital.

Presently, medical debt can seriously affect a person's credit score. Even paid-off collection accounts for medical debt can remain on file for seven years, and these blemishes on a credit record can severely affect a credit score for the first two years after the debt is created.

According to a 2008 study by the Commonwealth Fund, collection agencies contacted about 28 million Americans regarding medical debts over a two-year period of time. During the same period of time, 72 million Americans reported difficulty paying the outstanding balances on their medical bills.

Unlike other types of debt, medical bills are not something people choose to go in debt for. Most people with medical debt had unexpected illnesses or accidents. However, medical debt can negatively affect a person's credit score by more than 100 points.

Now, a bipartisan group of lawmakers in Congress would like to change that. They have introduced legislation that would limit the way medical debt can affect a credit score, especially for medical debt that has been paid off or settled.

The Medical Debt Responsibility Act of 2011 would require Equifax, Experian and TransUnion to clear credit files of medical debts of $2,500 or less within 45 days after the debts have been paid or settled. Presently, the act is in the early stages of the legislative process. In order to become law, the Medical Debt Responsibility Act would need to pass both the House and the Senate.

Source: Collections & Credit Risk, "Legislation Would Limit Credit Score Impact Of Medical Debt," 7/5/2011