I use all my H&R's with steel shot, the two ducks in my avatar where shot with a 26" 20 gauge modified barrel. It will not hurt the barrel to use steel shot. I called H&R years ago when i bought a full choke 12 gauge. Their response was.
It is safe to use all steel shot but they recommended not using shot any larger than # 2 steel to prevent possibly doing damage to the choke over a long period of time. They also told me they had not had any damaged guns sent in for repair from steel shot and this was just a recommendation.
I personally used that gun for years with steel shot up to BBB and it showed no wear from it at all, It had atleast a case of BB put through it, not even the slightest blemish.
The modified barrel will never have any problems as its not tight enough to have any issues . go ahead and use it