Due to the rising cost of healthcare, Americans are turning to the private sector for help in paying for their medical bills. This is a multibillion-dollar industry that is dominated by banks and private equity firms. According to a study conducted by IBISWorld, the profit margins in the patient financing industry are seven times greater than those in hospitals.
For years, hospitals and other healthcare providers have been offering patients interest-free payment plans. Now, they're signing contracts with lenders and making arrangements for easy payments.
According to an investigation by NPR and KHN, millions of people are paying for their medical bills with interest. Even though the rates on these plans are lower than credit cards, the interest can add up to hundreds or even thousands of dollars.
In addition to charging high interest rates, hospitals are also turning a profit from their patients' illnesses.
One of the country's leading medical credit card companies, Synchrony, offers a card that's designed for patients who don't pay their bills on time. If they fail to settle their loan, they'll be charged a 27% interest rate.
Patients often end up with higher interest rates and missed payments due to the complexity of the financing arrangements. The loans can also widen the inequalities in the distribution of income. For instance, those from lower-income families often face higher interest rates.
Before you start working on a strategy for paying your medical bills, make sure that you have at least a hundred words to paste in. For optimal results, you should also include at least five paragraphs.
Around 50 million people in the US are currently on a financing plan that they can use to pay for their medical bills. These plans are often linked to hospitals, which are receiving a cut of the interest payments.