They just updated your report. Your SOL expiration date hasn't changed any. And it will still fall off your report as scheduled. Nothing has changed.
I don't have any experience with medical collections. Different league. But some have had success dealing directly with the OC. If you'd prefer the CA route, try to DV if you haven't done so.
If you pay it, it will be marked as paid, but your score won't improve because of it.