KNOXVILLE, Tenn. (WATE) — If you have mounting medical bills or know someone who does, medical debt has started falling off credit reports. Beginning July 1, the three credit reporting agencies initiated a new policy giving those with medical debt a break.

TransUnion, Equifax and Experian began removing cleared medical debts from consumers’ credit reports last Friday. This means is if you have paid your medical bill in full, and the debt is still sitting on your credit report as a negative mark, this negative mark will now be removed. Also, unpaid medical debt will not appear on credit reports for a year.

“If your credit score goes up it benefits you in a number of ways. Your interest rate will go down on the loans you take out,” said Tony Binkley, CEO of Better Business Bureau of Greater East Tennessee. “I think it actually provides an incentive for people to pay off their medical debt because it is going to help them improve their score. Now if you pay it off, it is still out there for seven years in total. So if you pay it off now it will go away right away.”

Binkley also explains the benefits of unpaid medical debt no longer appearing on your report for up to one year, instead of the current six months.

“It gives you more time to pay that off before it starts affecting your credit score,” said Binkley.

Records show that people with medical debt on average owe between $5,000 and $10,000. The top drivers of medical debt are often unavoidable procedures. Emergency room visits make up 39% of medical debt while specialist visits make up 28%, surgery makes up 26%, childbirth makes up 22% and dental care makes up 20%. The report indicates medical debt prevents nearly one out of five from achieving financial milestones, a new home for example.

“It’s a tool to be able to clean up your credit score and credit report from a medical situation that you couldn’t control in the first place,” said Binkley.

While medical debt will start falling off credit reports which is good news, it does not eliminate your medical bills. If you owe $250 or $50,000 in medical debt, these new changes do not alleviate your responsibility to pay the debt.

However, there are several things you can do to start paying down your medical debt. You can call the medical provider and negotiate. Often providers are more than willing to settle on these things as they’re willing to get paid something, rather than nothing. Debt consolidation is also an option. If you have one or more medical debts and simply would rather pay it off, you may consider debt consolidation through a personal loan.