Financial institutions and fintech companies are generating a growing number of financing mechanisms for families and individuals struggling to pay their out-of-pocket health care expenses. This report focuses on some of these alternative financing products, including medical credit cards and installment loans, that were once used primarily for elective care but now cover everything from ER visits and specialty care to regular checkups.
Financial companies market these products to healthcare providers, who are encouraged to promote them to patients. These medical credit cards and installment loans have largely replaced the low- or no-cost informal payment plans offered to patients directly by their medical providers. The growing promotion and use of medical cards and installment loans can increase the financial burden on patients who may pay more than they otherwise would pay and may compromise medical outcomes.
This report highlights some of the risks to consumers of using financing products such as medical credit cards and installment loans to pay for medical procedures and services. The report provides a background on these products, highlights potential lack of transparency and financial risks to consumers, analyzes data on deferred interest healthcare credit cards, and offers a summary of the terms for a sample of financing products.