Increasingly, hospitals are encouraging patients to pay their bills with a new tool: medical credit cards.
Those cards typically offer reasonable terms for patients who repay their debts promptly.
AccessOne, a fast-growing Fort Mill company that works with more than two dozen hospitals, lets patients repay without interest if they retire the balances within a year.
But the consequences of late payment can be severe.
Huntersville resident Sue Bostic said she doesn’t recall exactly how she wound up getting a credit card to pay off a $1,600 hospital bill from Carolinas Medical Center-Mercy.
The AccessOne card carried an interest rate of 9.25 percent. But when she was late making a payment, she got a notice that the rate would climb to 18 percent if she didn’t pay on time.
“Why do they have to charge people who are sick 18 percent?” Bostic asked. “When they couldn’t afford insurance to begin with – they’re going to charge them 18 percent?”
AccessOne officials say their program gives patients a convenient way to manage hospital bills and avoid the collections process. Enrollment is voluntary, they say.
Unlike some medical credit cards, AccessOne doesn’t report patients to credit agencies or bill collectors if they default on payments, its executives say. It simply returns the accounts to the hospitals.
That, they say, is what happened in Bostic’s case. When Bostic wrote a letter objecting to the interest charges, AccessOne waived all finance charges and late fees, company officials said. Company officials said the card would not have been issued without Bostic’s approval.
AccessOne President Rusty Salton, a family physician who launched the company 10 years ago, says his card helps both hospitals and patients.
“How many families can write a $2,500 or $5,000 check? Very few,” Salton says. “… What I honestly believe is patients want to pay. But the hospital doesn’t give them a way to pay it. We’ve solved it.”
At the hospital, patients are given the option of signing up with AccessOne. The company doesn’t reject any applications, Salton says.
When patients enroll, the company puts them on a monthly repayment plan and charges the hospitals an administrative fee. That arrangement has helped hospitals increase their collection rates and lower the cost of collections, Salton says.
Carolinas HealthCare System, the Charlotte-based hospital chain that owns CMC, is AccessOne’s largest client. The hospital system collected $8 million through the program in 2009, says Greg Gombar, chief financial officer for CHS.
But what may be good for hospitals is not always healthy for patients, says Mark Rukavina, executive director of the Access Project, a nonprofit working to improve access to health care.
Rukavina says his staff has talked with many patients who felt pressured to sign up for such cards. On some cards, he said, those who are late on payments may see damage to their credit ratings, along with soaring interest rates.