Medical Loans for Healthcare Expenses
Consider the bill, inquire about financial aid, and consider payment options when thinking about the cost of treatment and the cost of the recovery process.
What Is a Medical Loan?
A medical loan is often a personal loan used to pay for dental work, prescriptions, deductibles, and other out-of-pocket healthcare expenses. You receive the funds or make the payment as allowed by the lender and repay according to the terms of the loan. Payment plans provided by healthcare providers and medical credit cards carry different terms.
This website discusses personal loans to cover healthcare expenses. Determine exactly how much you owe and check if the bill can be paid over time directly to the provider. Finance the bill only as a last resort.
Check the Bill Before Financing It
- Ask for an itemized bill. Verify the services rendered, the dates, and check for any mistakes or overcharges.
- Look at your insurance. If you have insurance, check your explanation of benefits and compare it to the bill. An explanation of benefits is not a bill.
- Ask about charges you don't understand. Contact the billing office to inquire about charges you don't understand, and contact your insurance company to inquire if a claim has been processed correctly.
- Verify the patient balance. Ask for a document explaining that a charge is incorrect and ask if you can delay payment.
CMS offers a helpful guide to check your medical bill for errors. Resolving a billing error may reduce the amount you need to finance.
Ask About Assistance and Provider Payment Plans
Talk to the billing office about financial assistance, charity care, discounted rates, and payment plans. Insurance does not always exclude you from receiving assistance. Ask what, if any, documents you need to provide, and whether your case is reviewed. You may want to wait to get outside financing if you do not have to.
The CFPB suggests checking assistance and insurance coverage before agreeing to medical credit products. Its medical financing guidance explains important terms and risks.
Compare the Available Payment Options
| Option | Questions to Ask |
|---|---|
| Provider payment plan | Are there any fees or will there be interest? Who will the payments be made to? What will happen if a payment is missed? |
| Personal loan | What will the net proceeds be? What will the APR be? What fees will there be? What will the total repayment be? Will you be able to afford the loan payments while you recover? |
| Medical credit card | Is the promotion truly zero interest or deferred interest? What balance needs to be paid, and by when, to avoid interest? |
| Assistance or a bill reduction | Who will assistance be provided to? What will be required to be submitted? How will the provider verify the new balance? |
If you do not pay off deferred interest financing within the time frame of the promotion, interest will be added from the purchase date. Ask for the full terms instead of assuming "no interest".
Budget for Treatment and Recovery Together
Budget for the costs of treatment and recovery together. Budget for any ongoing prescription and transport costs, as well as any reduced income during recovery. You will need to be able to pay for the loan and treatment as well as pay for housing and ordinary household expenses.
As an illustration, say you receive assistance to reduce a $2,000 bill by $500. You would still owe $1,500. Options to pay off that balance should be sought out instead of taking out a loan against the original $2,000 bill. This is an example, not a guarantee, of assistance that will be provided.
To get a ballpark figure, you can use a loan payment calculator, but check the lender’s actual payment schedule, amount you will receive, and any fees. You should not rely on uncertain reimbursement to make the first payment.
Understand What Happens When You Pay a Provider With a Loan
The provider's bill and the lender's debt are two separate obligations. Paying the provider with loan proceeds generally means you still owe the lender the money, even if you dispute the charge or wait for a refund. Ask how any provider refund will be issued and ask for an updated statement with the provider payments.
Personal loans used for healthcare are not always reported the same way as a medical collection account on your credit. You should ask the lender if they report the loan and what the consequences of a missed payment would be.
Requesting a Loan Through SlickCashLoan
Loan connection platforms introduce borrowers to potential lenders. SlickCashLoan will not be providing healthcare or deciding insurance coverage or loan approval. It may share your submitted information with potential lenders, and these lenders will determine the terms of the loan.
A request does not guarantee an offer or funds before a treatment or bill deadline. Compare any offer with assistance and provider arrangements. If you accept, keep the loan agreement, provider statements, and payment confirmations.
Frequently Asked Questions
Can a medical loan cover dental treatment or prescriptions?
Borrowing for these expenses is permitted if the loan agreement allows it. You should determine how much you need to borrow and ensure you can afford to repay the loan, especially if the prescription or care is needed multiple times.
Is provider financing always interest-free?
Not always. A provider may set up a payment plan for you, or direct you to a financing company. You should ask about the interest, fees, and the terms of the plan as well as the name of the company before you agree to anything.
Should I borrow before my insurance claim is settled?
You should first ask your provider and insurance what is still being reviewed and if the payment deadline can be changed. It is possible you may be taking on more debt than necessary by borrowing against an unresolved bill.