Many family caregivers rest easy under the impression their senior loved ones are insulated from high medical expenses because they’re covered by Medicare or a health plan that is part of their retirement benefits.
Reality may not match that impression – and for some may result in a rude awakening.
Big bills for healthcare services not covered by Medicare or insurance are driving many seniors to expensive credit with monthly charges that some find budget staggering.
Where do they get that credit?
It might just be through, or feel like it’s through, their healthcare provider.
Healthcare Credit Via the Doctor
Hearing aids, dental care and a number of costly medical procedures aren’t covered, or are only partially covered, by the health insurance coverage carried by seniors. When that happens, an increasing number of care providers have at the ready an offer of loans or credit cards that cover the cost of their care.
These financial offerings often carry a teaser rate as low as zero percent for some period but after that can carry interest rates over 20 percent – for starters. Most have provisions, often easily triggered, that can push the rate over 30 percent.
A needed set of hearing aids that makes a senior’s life more enjoyable or a dental procedure that eliminates pain and allows normal eating can take a major bite out of their monthly income for years. For many it’s a bite out of income that wasn’t there to take.
Turning Healthcare into an Impulse Borrow
Why would seniors take on a new debt they can’t possibly pay without giving up something else they need? When faced with a needed procedure or hearing aids that return normal life, it can be easy to jump when a trusted provider offers a way to swing the cost.
But why not call a family member or go home and find another way to pay? Maybe try to find another alternative to the unaffordable procedure or purchase? We can think of a couple of reasons and there are likely more.
- Embarrassment at the thought of admitting they need help paying
- Refusal to be a “burden” on family members
- Desire to get everything done now and not seeing any other option that made it possible
Sounds like healthcare providers and finance companies are teaming up to create a new class of impulse buy, doesn’t it? Unlike buying from a new car dealer or furniture store, two types of retailers who have famously turned instant credit into instant profit, many healthcare purchases aren’t transactions from which the “buyer” may feel able to walk away.
Why Would a Doctor Offer Credit?
First, we want to make clear that many doctors choose not to offer this sort of credit to patients for a number of reasons. Many doctors who do truly see it as a real service to patients, allowing them to get the care they need but would otherwise not receive.
We have seen no indication that offering credit is illegal, though some doctors feel the practice is inconsistent with the traditional doctor-patient relationship.
Is there a financial incentive for doctors? There may be some who get financial benefits from the lender but for most it sounds like the only economic gain is the ability to collect for services that may otherwise not be performed or billed and not paid.
Seniors Burdened by Healthcare Debt
We’re not saying providers offering financing are doing something that’s automatically wrong and, after all, our senior loved ones are getting care they (hopefully) need. So why do we see this as an important topic for family caregivers?
Seniors taking on these loans and credit cards may be giving up other purchases they shouldn’t in order to get the bills paid – or missing payments they can’t afford to make only to see the terms ratchet up and the financing become even more unaffordable.
They may need loved ones’ help to simply make ends meet.
What can we as family caregivers do to keep this from happening? There’s no single right answer for everyone, but these are some steps to consider:
- Attend healthcare appointments with our senior loved ones which, as we frequently discuss, can have health and care benefits beyond the financial.
- Check with healthcare providers before appointments to see if they offer lending programs, then review and share information about those programs with seniors before they go to their appointment. This puts them in a better position to make decisions.
- Investigate ahead of time other options for paying for needed care or getting a lower price elsewhere.
When healthcare providers are treating care as a consumer good to be financed, we and our senior loved ones should become educated consumers, just as we would with other purchases.
Buyer be aware!