Be Careful Signing Up for Credit at the Doctor’s Office

Out-of-pocket medical expenses are growing every year. Even people with health insurance find themselves with uncovered medical expenses that must be paid out-of-pocket. If you can’t afford to pay out of pocket for big-ticket medical services, the doctor’s office may get you to sign up for a payment plan. The credit cards are certainly a win for credit card companies who are always looking for a way to make more profits and a win for doctors and hospitals that want to avoid the cost of pursuing payments.

Unfortunately, the cards aren’t that great of an option for consumers who may end up paying double digit interest rates for medical services. What’s worse is that too often, the service providers who pitch the cards don’t clearly let patients know that they’re signing up for a credit card and not a simple repayment plan.

Michigan Attorney General’s office, for example, has received 40 complaints about financing from at least one medical office that didn’t properly disclose the credit card or its terms.

Medical credit cards aren’t necessarily a new thing news archives from the New York Times show that Blue Cross introduced a medical credit card to Maryland residents in 1988. Even President Nixon had great plans for health care reform that involved medical credit cards.

Considering the majority of bankruptcies are tied to medical debt, medical credit cards may not be a good idea. Widespread use of medical credit cards could push more consumers into debt and bankruptcy as they charge procedures they otherwise can’t afford.

If you’re in the doctor’s office and you’re pitched a credit card, payment plan, or some other type of repayment plan, make sure you get details on the plan. Ask specifically, “Is this a credit card?” If it is a credit card, ask to see the disclosure for the credit card. All credit card offers must be accompanied by a disclosure sheet that tells you the pricing for the credit card. Look at the interest rate, both promotional and non-promotional, and fees to decide if the card is a great deal. If the credit card has a promotional rate, see how long it lasts and consider whether you can repay your balance in that amount of time.

Don’t think your only option is to sign up for the credit card or go without services. Start by confirming that your health insurance company doesn’t cover the services. Then, ask the hospital for any type of repayment plan that doesn’t involve a credit card. The billing department may have more information. There may be local charities or public groups who can help you pay the cost. Seek pricing alternatives from another doctor or hospital. If the medical services aren’t urgent, consider saving up for the service and paying cash rather than charging the service and paying interest.

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