Skip to main content

Medical Credit Cards

IF you are like most people, you have probably used a credit card to pay some of your medical bills. With rising health costs and gaps in insurance coverage, it's almost unavoidable.

Patients pay about $45 billion worth of health care costs with plastic, according to a McKinsey report. By 2015, it could more than triple to an estimated $150 billion. And big finance companies and medical providers have taken note.

In US, GE Money, Citibank and JPMorgan Chase have issued medical credit cards or lines of credit intended to be used specifically for elective health care expenses not covered by insurance, including certain dental procedures, some cosmetic surgery and even veterinary care.

The issuers market these cards not so much to consumers but to doctors, who in turn offer them to patients as a payment option.


Patients like medical credit cards because payments can be spread out over many months and the cards can be used at multiple providers.

But critics and patient advocates claim that misleading marketing tactics can lead to serious headaches for consumers. More commonly, critics say, patients may be led to assume that their providers are simply offering payment plans, not a credit card with all the potential fees, interest rate increases and the impact on credit scores that can entail.

Ironically, these cards may be best suited to people who already have financial resources, a consumer advocacy group. But it's usually people with limited resources who sign up.

Whether you view these cards as a convenient way to pay medical expenses or just another way for credit card companies to collect interest and fees.

Here are some things to consider if your provider approaches you:


Ask for alternatives: I encourage people to negotiate and get an extended payment plan directly from that office with a monthly payment and time period you are comfortable with.

If you choose to sign up, be sure you've read through the terms carefully and that you understand the interest rates and late payment fees.


Dodge the hard sell: Some patients report feeling pressured by their clinics to use the card to pay for procedures or treatments they may not need or can't afford.

That's no surprise, since these cards are intended, at least in part, to drive more business to dentists, surgeons or doctors. Take a day or two to read through materials thoroughly and research your options.


Beware of teaser rates: Almost all medical credit cards claim zero per cent financing. This is what makes them attractive: you can spread out your payments and pay no interest.

But it is important to read the fine print. As with most credit cards marketed this way, the zero per cent rate lasts only for an initial promotional period, usually from six to 24 months.


Pay as you go: If you change providers midway through, it can be difficult and time consuming to get a refund. If your treatment will take more than one visit, make sure your provider is billing you by the visit, not lump sum.

 

Popular posts from this blog

How to Decide your asset allocation with Mutual Funds?

Invest In Tax Saving Mutual Funds Online Download Tax Saving Mutual Fund Application Forms Buy Gold Mutual Funds Call 0 94 8300 8300 (India) How to Decide your asset allocation ? The funds that base their equity allocation on market valuation have given stable returns in the past. Pick these if you are a buy-and-forget investor. Small investors are often victims of greed and fear. When markets are rising, greed makes the small investor increase his exposure to stocks. And when stocks crash to low levels, fear makes him redeem his investments. But there are a few funds that avoid this risk by continuously changing the asset mix of their portfolios. Their allocation to equity is not based on the fund manager's outlook for the market, but on its valuations. Our top pick is the Franklin Templeton Dynamic PE Ratio Fund, a fund of funds that divides its corpus between two schemes from the same fund house-the...

All about "Derivatives"

What are derivatives? Derivatives are financial instruments, which as the name suggests, derive their value from another asset — called the underlying. What are the typical underlying assets? Any asset, whose price is dynamic, probably has a derivative contract today. The most popular ones being stocks, indices, precious metals, commodities, agro products, currencies, etc. Why were they invented? In an increasingly dynamic world, prices of virtually all assets keep changing, thereby exposing participants to price risks. Hence, derivatives were invented to negate these price fluctuations. For example, a wheat farmer expects to sell his crop at the current price of Rs 10/kg and make profits of Rs 2/kg. But, by the time his crop is ready, the price of wheat may have gone down to Rs 5/kg, making him sell his crop at a loss of Rs 3/kg. In order to avoid this, he may enter into a forward contract, agreeing to sell wheat at Rs 10/ kg, right at the outset. So, even if the price of wheat falls ...

Benefits Of Repo Rate & CRR Rate Cut On Consumers

  How Reduction In Repo Rate & CRR Affects Customers Finally  RBI announced slashing of repo rate by 25 basis points (bps ) and cash reserve ratio (CRR) by 25 bps which industry experts believe will fuel the economic growth to some extent. Although experts were expecting higher rate cut this year. This lowering of the rate cuts has taken place for the first time in nine months. Now let's see how reducing the repo rate (defined in economic term as the rate at which RBI lends money to the banks) relates to the following individuals and sectors: Banking:   Lowering of repo rate directly reduces borrowing costs of a bank. Banks in turn reduces interest rates on different types of loans such as home, auto, business etc. Similarly trimming down of CRR allows banks to unlock money for lending to the customers i.e. with 0.25 rate cut banks are estimated to lend more than INR. 17 Crores. Consumers:   Lower repo rate does not necessarily benefit existing loan borrowers but new loan se...

Zero Coupon Bonds or discount bond or deep discount bond

A ZERO-COUPON bond (also called a discount bond or deep discount bond ) is a bond bought at a price lower than its face value with the face value repaid at the time of maturity.   There is no coupon or interim payments, hence the term zero-coupon bond. Investors earn return from the compounded interest all paid at maturity plus the difference between the discounted price of the bond and its par (or redemption) value. In contrast, an investor who has a regular bond receives income from coupon payments, which are usually made semi-annually. The investor also receives the principal or face value of the investment when the bond matures. Zero-coupon bonds may be long or short-term investments.   Long term zero coupon maturity dates typically start at 10 years. The bonds can be held until maturity or sold on secondary bond markets.

Seven things to remember in any bear run

  The year 2008 was a unkind to investors so far. Many have suffered huge losses. It's worth reminding ourselves of basic lessons that every retail investor ought to keep in mind to avoid, or at least minimise, losses in one's portfolio. 1. High rewards don't come without taking high risk. During a bull market, retail investors get taken in by the rise in the stock market. They don't want to be left out. So, they rush in and buy in an indiscriminate way, without realising that they might be taking on too much risk. Remember, if you chase high returns, high risk will follow you. Let's take the example of publicly-listed real estate sector in India. The industry has a very favourable long-term future. However, the rapid rise in the sector's stock prices over the past year made a short-term investment in these stocks a risky bet. As it turns out, the risks have been borne out and this sector has collapsed spectacularly. Understand your own risk profile and how ...
Related Posts Plugin for WordPress, Blogger...
Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now