Health experts suggest signing bank loans at hospitals may result in unaffordable costs: 5 things to know

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More hospitals are offering loan options to patients during care, but this practice raises various concerns among health experts and could result in unaffordable expenses, according to The Washington Post.

Here are five things to know about the issue.

1. Hospitals continuously seek patient payment options to help ensure they receive the money they're owed. This is especially important as more patients struggle to pay their medical bills due to high-deductible health plans, and because they are taking on greater financial responsibility for their medical expenses.

2. One option promoted by hospitals is no- or low-interest loans through partnerships with banks and other financial institutions. Bruce Haupt, CEO of ClearBalance, a provider of patient loan programs, estimates about 15 to 20 percent of U.S. facilities now have partnerships with lenders to offer loans, according to the report. He anticipates that number will only get larger.

3. Hospitals often offer patients these loan options while they are receiving care. According to the report, the process includes a hospital estimate of what the patient owes out-of-pocket, information on payment plans and an option to sign up for a loan on the spot. The patient subsequently pays the lender monthly.

4. Health experts have concerns about the method, according to the report. Specific concerns cited in the report include the possibility of inflated cost estimates that may be based on a hospital's list price rather than the negotiated rate with insurers, and patients in need of care feeling pressured to use the loan option without adequately assessing all of their payment options first. Experts argued patients could potentially face out-of-pocket expenses they can't pay for.

5. A spokesperson for Mercy Hospital Northwest Arkansas in Rogers told The Washington Post patients have been grateful learn about the loan options quickly "because it relieves their worry about paying the costs of their care."

Read the full report in The Washington Post here.

 

More articles on healthcare finance:
Trump's 2019 budget blueprint: 15 healthcare takeaways
Pennsylvania hospital loses tax-exempt status: 4 things to know
North Carolina treasurer asks UNC Health Care for $1B bond to ensure cost savings from pending merger 

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