Why Credit Cards Aren’t Always the Best Way for Patients to Pay

You likely see it in your practice on a regular basis – a patient is unable to pay outright for the procedure or treatment they’re seeking. The out-of-pocket cost is more than your patient anticipated, and they don’t have the funds to cover the full expense.

When deciding how to pay for elective procedures or treatments not covered by insurance, a patient often turns to their credit card. However, a credit card can be a less than ideal payment choice for both the patient and your practice.

Financing a medical expense with an installment loan is often a smarter alternative for the patient — and it makes more sense for your practice, too. Becoming educated on the differences between installment loans and credit cards will help you guide your patients towards making the best payment choice.


Check out the advantages of patient financing versus credit cards, and see why installment loans make the most sense for patients, and your practice:

Benefits for Patients

  • Installment loans are billed in equal monthly amounts

Patients will know, up front, how much they need to pay each month for their procedure or treatment. Unlike credit card payments, loan payments don’t fluctuate. Financial website Investopedia says the following about credit cards: “The interest rate is rarely locked in, and creditors have the right to increase your rate if you fail to make payments.” This can make credit card payments difficult to budget for.

  • Installment loans have a definite payoff date

Unlike an installment loan’s set timing for payment in full, credit card companies allow varying minimum payments each month. When only minimum payments are made, credit card debt can take an exceedingly long time to pay off — while the balance continues to accrue more interest. Regarding minimum payment calculations, CreditCards.com says, “With a few minor variations, the “1 percent plus interest method” is used by 9 of the top 10 U.S. credit card issuers.”

  • The amount financed via an installment loan does not change

Credit cards allow for further charging to happen. As long as a patient is under their credit limit, additional debt can be racked up. That makes for a slippery slope. The patient can continue to add to the original balance, with no full payoff in sight.

  • Paying with an installment loan means your patient won’t tie up open-to-buy on their credit card.

Keeping a lower revolving credit utilization has two key benefits:

1) The patient will have available room within their credit limit in the event of an unanticipated expense comes up

2) Even more importantly — a higher credit utilization ratio has the potential to weigh heavily upon their credit score, as Investopedia explains here.

Benefits for Practices

  • Point of sale financing translates into savings on the costs to accept and process credit cards.

This is especially true in the case of specialty cards such as CareCredit and others like it. Often, patient financing via an installment loan from LendingUSA can mean thousands of dollars in savings.

  • Patients typically have access to a higher financing amount when taking advantage of a point of sale installment loan rather than a credit card.

For example, an installment loan from LendingUSA can be as high as $35,000. This provides your patient the opportunity to pursue the chosen surgery or procedure(s) with confidence. And, the expanded ability for what the patient can pay also allows you to grow your practice.

  • Offering installment loans through a point of sale financing process is a service differentiator.

Patients appreciate the ease, affordability and convenience of an added payment option. When a patient knows they can afford your care, the stage is set for them to return for future treatments or surgery.


The takeaways:

What does all of this boil down to? It’s simple.

  • Installment loans via point-of-need financing are a better means of payment than credit cards, for both you and your patients
  • Patients will appreciate being saved the budget headaches, costs and other disadvantages that come with trying to accommodate a big purchase on a credit card
  • You can save money and grow your practice when your patients pay for more expensive procedures and out-of-pocket cost with an installment loan, like those offered by LendingUSA

Ultimately, when you remove the stress of figuring out how to pay for a desired procedure or treatment, you improve your patient’s overall experience and outcome. A patient who has confidence about how they can pay for medical costs is more likely to be receptive to what you recommend for them. And, when that happens, they can focus on looking good and feeling good.

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