Disadvantage of using credit cards to pay for COVID-19 medical bills

Insurers are waiving out-of-pocket costs for COVID-19 diagnostic tests, and some are also waiving visit costs associated with testing. It is imperative that you check with your insurance and stay abreast of state to federal changes for the exact tests or services that will be waived and for what period of time. However, you could still incur substantial medical bills if you need treatment for COVID-19, so keep up to date with healthcare policy design around out-of-pocket costs for COVID-19 as it is rapidly evolving.

In this era, many people pay for most of their purchases with their credit cards. Some also do this with your medical bills. However, the question is: is it wise to pay your COVID-19 medical bills with your credit card? It depends. Below are points to consider to help you decide whether or not to use your credit card to pay your medical bills.

Advantages of using your credit cards to pay medical bills

• Acceptability: Credit cards are widely accepted and are always sufficient when a service provider does not accept checks. It’s also a great option in situations where you can’t write a check or pay cash for a procedure.

• Convenience: Credit cards are very easy to obtain if you meet their credit requirements. It’s so easy that you can get one almost immediately after applying.

• Interest Rates: Credit cards sometimes offer a low-interest or no-interest promotional period. It gets even better when you use one with a 0% APR period; With this, your interest does not accrue until the APR period ends.

• Rewards and benefits: You can earn rewards from your credit card provider when you use cards to offset bills.

• Build a positive payment history – Your credit card can help you build a positive payment history if you make your payments on time.

Disadvantages of using credit cards to offset medical bills

• Insurance – Make sure you know exactly what your insurance covers, as getting your money back after paying with your credit card can be tedious and time consuming. There is a high probability that insurance coverage related to COVID-19 treatments will change as it is a new health issue.

• Poor Credit Score – You can seriously damage your credit score if you miss a credit card payment for more than thirty (30) days and your provider reports the late payment to the bureau. Fortunately, health care providers are unable to report their late payments for at least six months; this way, you have more time to protect your credit score.

• Increased debt: Many medical debts do not earn interest. However, if you take a balance on your card and it doesn’t have a 0% rate, you can earn interest when using your card to pay medical bills.

Additional steps to take when paying medical bills

• Know your payment options – Don’t wait until there’s an emergency to learn about your payment options, as emergencies aren’t the best times to make wise money decisions.

• Double check your medical bills – Your bills could be fraught with errors. Therefore, always check that you are not paying due to errors or duplicate invoices.

• Confirm insurance coverage – Make sure your insurance covers what it should. This may require a few phone calls to your insurer if your plan’s policy booklet is unclear.

• Negotiate your bill – You can negotiate anything, including healthcare. You can try to negotiate a reduced balance with your health care provider using average cost estimates from your insurer or online resources. Remember, however, that each circumstance is unique and yours may be more complex.

• Bill Payment Plans – Chances are your health care provider will be open to a viable payment plan. Maybe right now you can only pay X but in 60 days you can pay more. Ask your provider to consider your circumstance, keeping in mind that your doctor or medical center also has a business.

• Get a Home Equity Line of Credit: Owning a home could provide you with a medical loan at reasonable interest rates. However, you could lose your home if you don’t pay it off, so you may want to try getting a loan from family or friends.

• Filing for bankruptcy: While this may seem extreme, you may want to consider it when other options prove unsuccessful and your debt limit is such that it requires a fresh start.

Using your credit card to pay your medical bills, including coronavirus treatment, can be a quick fix; however, it can cause additional long-term negative consequences. Evaluate your situation and all available options.