Plastic Pays the Medical Bills

Posted in Health Insurance

August 17th, 2009

Earlier this month CNNMoney reported that with the cost of medical care rising at lighting speed, more Americans are relying on their credit cards to pay off expenses at an equally quickened pace. Annually, consumers incur an estimated $296 billion in out-of-pocket medical expenses (including co-payments, prescriptions, surgeries,etc.). This total reflects the expenses of both the insured and uninsured.

For years many have plunked down their credit card to pay for those additionally expenses associated with seeking medical assistance. According toBruce Carlson, publisher with health care market research firm Kalorama Information, “…with high unemployment,consumers have to reach into their pockets even more to fund their health care.”

Several credit card providers are tapping into this trend and designing cards specifically to be used for medical (and dental treatment). Once such card issuer is GE under the card name of CareCredit, and those who need to pay either for non-elective or elective surgery can apply. Industry insiders see this trend of charging medical treatment as a new business model that that can lead to multi-billion dollar profits.

Debt associated with medical expenses it is the number one cause for bankruptcy filings annually. With more people relying on their available lines of credit to manage the cost of treatment, it has become increasingly easy for the bills to stack up now with the hope of paying them off later.