What You Should Know About Medical Credit Cards

A new pair of eyeglasses can be expensive, even if your patients have vision insurance. Offering medical credit cards provides them with a line of credit that enables them to cover the cost of vision services and ensures that your practice is paid immediately.

How Do the Cards Work?

Medical credit cards can be used to pay for routine eye examinations, co-pays, deductibles, dry eye treatment, vision therapy, eyeglasses, contact lenses, sunglasses, safety glasses, LASIK treatment and other services. Patients apply for the cards in your office and receive approval just a few minutes after your employees submit the request electronically. Soon after the application is approved, patients receive their first bills and begin making monthly payments. Most companies offer interest-free payments for six months to up to two years. After the interest-free introductory period expires, credit card holders pay a fixed interest rate until the balance is paid.

Which Companies Offer Medical Credit Cards?

CareCredit is the most well-known medical credit card company, but several other companies offer the cards, including Citigroup, Wells Fargo, Access One and MedKey. Because each company offers different introductory terms and interest rates, it’s a good idea to compare several before making a decision.

How Can Medical Credit Cards Help My Practice?

If you don’t offer payment alternatives, patients may just decline to order glasses or contacts. When they leave the office empty-handed, your practice doesn’t meet its goals, and your patients’ vision may suffer.
Although patients may not be able to afford large upfront costs, many can handle monthly payments. You may find that fewer patients decline treatments or fail to order eyeglasses or contacts when you offer medical credit cards.

Are There Any Drawbacks?

In 2013, CareCredit was forced to refund up to $34.1 million to consumers due to deceptive enrollment practices. According to the Consumer Financial Protection Bureau, CareCredit didn’t adequately explain repayment information, and many customers believed that the card was interest free, not interest deferred.
The failure to fully inform clients of medical credit card terms is the chief criticism of every medical credit card on the market. Patients often don’t understand that even one late payment will immediately end the interest-free period and that the new interest rate will be applied retroactively.
Most medical credit card companies don’t check cardholder credit histories, which means credit may be extended to patients who can’t make payments. When these patients have complaints about the credit card companies, they may share them with you, even though you don’t set the terms.
You can help decrease complaints by ensuring that your front office staff clearly explains the terms of the cards and provides a disclosure statement that describes terms and penalties.
Medical credit cards can be a boon to your practice and may help you ensure that financial issues don’t prevent your patients from receiving the care they need. Reviewing the terms of each credit card company and researching complaints against the companies you’re considering will help you avoid problems.
Sources:
Consumer Financial Protection Bureau: CFBP Orders GE CareCredit to Refund $34.1 Million, 12/10/13
https://www.consumerfinance.gov/about-us/newsroom/cfpb-orders-ge-carecredit-to-refund-34-1-million-for-deceptive-health-care-credit-card-enrollment/
WalletHub: Medical Credit Card: Comparison, Alternatives & Tips, 12/24/14
https://wallethub.com/edu/medical-credit-card/25842/
Becker’s Hospital CFO Report: Top Five Reasons to Offer Patients Flexible Payment Options, 4/19/17
http://www.beckershospitalreview.com/finance/top-five-reasons-to-offer-patients-flexible-payment-options.html
AccessOne: Med Card
http://www.accessonemedcard.com/
MedKey: Healthcare Finance
https://www.medkeyinc.com/MedKey/
CareCredit
https://www.carecredit.com/
Citigroup: Citi Health Card
https://www.citicards.com/cards/portal/healthcard/nsc/content.do?screenID=5000
Wells Fargo: Wells Fargo Health Advantage
https://retailservices.wellsfargo.com/healthadvantage.html