Doctor's Visit? Think Twice Before Using a Card

Recent data indicates that more people are paying for medical care with their credit cards. High unemployment and more expensive health care were cited as big reasons why health care consumers have pivoted towards plastic.

According to the health care analytical firm McKinsey Consulting, approximately 25% of the $294 billion of out-of-market medical care costs (usually earmarked for doctor’s visit and many prescription drug purchases) are paid for with credit cards. That’s almost $75 billion. But by 2015, McKinsey estimates, that the number will double to $150 billion.

But that’s not all. A Brandeis University consortium called The Access Project calculates that that poor and middle-class American consumers with medical debt incurred an average of $11,623 in credit card debt. Compare that to $7,964 for households with no medical debts on their credit card statements.

Okay, scary enough. So how can you avoid being a card-carrying member of that pricey group? Here are some tips.

Open a health care savings account – Health care savings accounts enable you to stash money away for medical bills on a tax-advantaged basis, and allow you to still have a high-premium health insurance package to help pay for the really big medical expenses. By stashing $50 or $100 per month in an HSA, you’ll have the money to pay for the odd check-up or trip to the doctor to address that winter flu. Credit cards are all about losing financial control while Health Savings Accounts are all about giving you financial control. Choose appropriately.