Protesters walk along a street outside Mount Sinai Hospital in Manhattan, New York, the United States, on Jan. 11, 2023. (Photo by Ziyu Julian Zhu/Xinhua)
These new forms of medical debt can create financial ruin for individuals who get sick.
NEW YORK, May 12 (Xinhua) -- Medical credit cards, once limited to esoteric procedures that weren't covered by insurance, have grown in popularity in the past decade as health care costs have continued to rise and Americans are spending more out-of-pocket for even routine procedures, reported CBS News on Tuesday.
But these products can cause trouble for patients, with many of them overpaying for specialized medical finance products, signing up for contracts they don't understand or, in the worst-case scenario, piling on debt they can't get out of, the news media cited a recent report from the Consumer Financial Protection Bureau (CFPB).
"These new forms of medical debt can create financial ruin for individuals who get sick," CFPB Director Rohit Chopra said in a statement.
Millions of patients are using this type of financing. CareCredit, a subsidiary of Synchrony Financial and one of three major medical cards examined in the report, has 11.7 million cardholders this year, triple the number a decade ago, the CFPB found.
The CFPB questions whether specialized medical financing truly expands access to the underinsured. Instead, the bureau writes, formal financial services like medical credit cards or installment plans have come to replace informal, often zero-interest payment plans offered directly by health care providers.
That added convenience for doctors can come at a high cost to patients. Patients, who are often pitched these financial products in the midst of trying to make medical decisions, often miss crucial financial details like the interest rate on a loan or its specific payment terms, the CFPB found. ■