The Federal Government Takes Aim At Medical Credit Cards

admin May 10, 2023

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A growing number of Americans are turning to medical credit cards and installment loans to finance their healthcare costs – and the federal government is taking notice. The Consumer Financial Protection Bureau estimated patients used these products to pay for $23 billion worth of healthcare expenses between 2018 and 2020 and ended up paying $1 billion in deferred interest, according to a recent report. “Fintechs and other lending outfits are designing costly loan products to peddle to patients looking to make ends meet on their medical bills,” CFPB Director Rohit Chopra said in a statement. “These new forms of medical debt can create financial ruin for individuals who get sick.”

Historically many healthcare providers offered no- or low-interest payment plans to lower income and uninsured patients, but they are being replaced by these credit cards and loans from third-parties, which can result in patients paying significantly more than they otherwise would, the report found. The CFPB said interest rates may vary, but a typical medical credit card charges around 26.99%, while the average for a regular credit card is around 16%. These cards and loans are often offered to patients in partnership with a medical provider, but one of the issues is that patients may agree to the terms without realizing they may be eligible for other options, such as financial assistance programs or insurance, the agency said.

Task Force Recommends Mammograms Start At Age 40 Instead Of 50

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The U.S. Preventive Services Task Force released new draft recommendations this week calling for all women to get screened for breast cancer every other year starting at age 40 rather than 50. The group estimated the change could save 19% more women’s lives, but also said more research is urgently needed to better address health disparities, noting Black women have a 40% higher risk of dying of breast cancer than white women.

Pipeline & Deal Updates

AI Drug Discovery: Recursion announced this week it signed agreements to acquire AI digital chemistry startup Valence and deep learning company Cyclica. The total of both deals is $87.5 million.

Patient Billing: Inbox Health, which has developed a digital platform for patient billing communications, raised a $22.5 million series B round led by Ten Coves Capital.

AI For Eye Health: Ascertain, which is a collaboration between Northwell Holdings and Aegis Ventures, announced this week it has launched a new AI company, Obtain, with a seed funding round of $12 million. The new company is aimed at developing an AI platform that diagnoses disease through retinal imaging.

Precision Oncology: Earlier this week, Guardant announced results from clinical studies of its blood test for colorectal cancer, which found t was successful in detecting cancer overall 83% of the time and 55% of the time in stage I, which may provide doctors with an additional tool for catching this type of cancer early.

Surgical AI: Insurance company Relyens, hardware developer Intel and surgical software platform company Caresyntax announced they are launching an AI-based surgical software platform that will be installed in operating rooms in the hospital system of Paris.

Covid’s No Longer A Public Health Emergency: Here’s How That May Affect You

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The Covid Public Health Emergency ends Thursday, which means changes to the way the CDC tracks Covid-related data and the cost of tests, vaccines and treatment. There are also potential implications for telemedicine prescribing of controlled substances, including access to gender-affirming care, though the Drug Enforcement Agency recently extended flexibility for established patient relationships through November 2024.

Other Healthcare News

The Republican-led Missouri legislature approved a bill Wednesday banning gender-affirming care for minors. Here’s where other states stand.

Cigna reported more than $1.2 billion in first quarter profits as the health plan added 1.5 million new members.

Novo Nordisk, the manufacturer of weight-loss drug Wegovy, is limiting the supply of the medication’s lower starter doses in response to growing demand and expects patients could have difficulty filling these doses through September.

The World Health Organization hailed new research demonstrating the effectiveness of a method of treating childbirth-related bleeding as a “major breakthrough” in tackling the leading cause of maternal deaths.