Credit cards and doctors visits

By glblguy

doctors visit

I was reading over on CNN Money this weekend that a health care market research company is seeing a growing trend in consumer use of credit cards to pay for medical bills. Due to high unemployment and ever increasing health care costs, consumers are reaching out to credit in order to continue receiving health care. Now, here’s the scariest part: CNN also reported that health care industry watchers see a multi-billion dollar opportunity to offer specialized “medical” credit cards!

If you haven’t figured this out already, let me explain this simply: “Consumers” (That’s you folks) visit the doctor one day, and potentially pay for that doctor’s visit for the next 1-5 years.

Already, 25% — 74 billion or so — of the $294 billion spent on out of pocket medical expenses is charged to standard credit cards.  With our current economy and jobless rates skyrocketing, this number is expected to grow quickly. A health care consulting company, McKinsey Consulting, expects this number to grow to $150 billion by 2015.

How can you avoid having to use a credit card for medical expenses?

Here are just a few ways you can avoid using credit cards to pay for your medical expenses:

  • Have a medical emergency fund – Start saving money to a medical emergency fund. Use this fund to cover unexpected medical costs. Learn more about specialized emergency funds.
  • Set-up a Flexible Spending Account or Health Care Savings Account – Not only do these specialized savings accounts reduce your taxable income, they also can cover your medical expenses. I’ve used an FSA (Flexible Spending Account) for the past 10 years and found it to be a powerful too for saving money and covering required medical expenses. Learn more about Health Care Spending Accounts from Cash Money Life.
  • Budget for medical expenses – First, if you don’t have a budget, create a budget. Make sure you include an expense category for planned medical expenses. This category would include any prescription medicines you require, over the counter products, upcoming doctor’s appointments, etc. Accounting for these costs in your budget allocates money for those expenses and will keep you from having to use credit cards.
  • Talk to your doctor – If you’re struggling financially right now and feel you might not be able to cover medical costs without resorting to credit cards, talk to your doctor. Doctors can often reduce their expenses, provide tips for getting lower cost health care, or refer you to services that can assist you with medical expenses. Don’t be ashamed to ask! Medical costs are expensive.

Money Saving Monday

What are your thoughts on this? What tips can you share with other readers to soften the blow of medical expenses? Add a comment!

This article is part of an ongoing series called Money Saving Monday. Each Monday, I share tips and techniques you can use to start saving money. Have a tip? Send it my way.

Photo by: dionhinchcliffe

9 Responses (including trackbacks) to “Credit cards and doctors visits”

  1. Tyler@FrugallyGreen Says:

    These are good tips and I highly advocate using them for any planned medical care (keep in mind that you forfeit any left over money in most flexible spending accounts at the end of the year).

    However, you can save every penny you ever made and plan out every expense you have, but if you find yourself out of work or underemployed with no health benefits and you injure yourself, you can be financially ruined. Emergency medical care bills get so big so fast even the most well-to-do can’t manage them. Now, how to handle this is well beyond the scope of this article and probably even this website, but it’s something that is deeply concerning to me.

  2. Dramon Says:

    Prevention is the best think. Practice good health practices including eating well, getting excercise. I am forturnate that I have a doctor that recommends life style changes prior to prescribing medicine.

    While I agree prescription drugs save many lives, there are items that you can do to change your lifestyle so you don’t need them.

    A good example is rather than taking expensive cholestral prescription medicine, I swithed to eating oatmeal in the morning along with a daily walk. It dropped enough so I don’t need the medicine.

    As suggested ask your doctor and be a good consumer of medical care.

  3. MoneyFunk Says:

    That is scary! Just one more push for Universal Healthcare. But until then carry out with that great list you provided – an emergency fund is so important!

  4. SingleGuyMoney Says:

    That’s just great. Another way to get people into debt. Unfortunately, some people will probably get caught up in the trap.

  5. TheWit Says:

    Here’s a thought: asking a doctor what treatment you need is a bit like asking a mechanic what repairs your car needs. He has a vested interest to recommend stuff you don’t require because he makes money from it. I’m not saying he does this unscrupulously or with ill intent – it’s just human nature, and he may even be thinking he’s doing you a favor.

    The best thing one can do is take charge of one’s health:- eat sensibly, exercise, avoid excessive alcohol or smoking.

  6. CJ Says:

    I am an Optometrist. I NEVER order any tests that I do not deem meidcally necessary. And I also know there are mechanics that are honest too. In every profession (lawyers, teachers, car salesmen, etc), there are honest and dishonest people.

    Also, Universal Health Care is not the way to go. Doctors should be the ones making medical decisions, not the government.

    That being said… Optometry is one of the very few medical professions that are retail as well. Because of the recession, many employers are cutting health benefits. Eye and dental are the first to go.
    I have a very wide variety of glasses to choose from (inexpensive to super expensive). My staff does not bully anyone into getting something they cannot afford. But my staff does educate my patients with all of the options that are available and which options would suit their lifestyle needs. (Computer work, nighttime driving).

    Because people usually have one pair of glasses for approx 2+ years, most people will spend a fair amount to look good.
    And because of the cuts in benefits, more of my patients are using credit.

  7. TheWit Says:

    Dear CJ – sorry if I caused any offense. I didn’t mean to say doctors or mechanics are dishonest. What I meant is that many circumstances may predispose offers for additional services that may not be strictly necessary. Sometimes it’s the policy of the hospital where the doctor works (e.g. they have just pioneered a new procedure and are keen to promote it), sometimes it’s just background influence (a journal the doctor reads may be very highly in favor of particular line of thought). We know even top doctors and medical professionals disagree on results of tests (e.g. recent news from Britain that some breast cancer treatment is unnecessary or even risky). My real point is:- we need to equip ourselves with good health and wide knowledge, and take doctor’s advice as what it is – just advice, not gospel truth.

  8. PLR Products Says:

    This is a very informative post! Keep up the good work.