PORTLAND, Ore.–(BUSINESS WIRE)–medZERO, a leading healthcare financial wellness company and provider of on-demand, interest-free funds to employees to pay for out-of-pocket health costs, has responded to the report issued today by the Consumer Financial Protection Bureau (CFPB) on the risks associated with medical credit cards and financing plans.(https://www.consumerfinance.gov/about-us/newsroom/cfpb-report-highlights-costly-credit-cards-and-loans-pushed-on-patients/)
The CFPB report estimates that people in the US paid $1 billion in deferred interest on medical credit cards and other medical financing in just three years, from 2018 to 2020. The agency also found that interest payments can inflate medical bills by almost 25%, putting patients at risk of falling into debt traps.
The agency identified specific loan products that can be costly for patients looking to manage their often-unexpected medical bills. These forms of medical debt, frequently offered at the point of care (doctor’s office, dentist, etc.) can cause financial stress and may impact the overall well-being of individuals who are dealing with medical issues. In some cases, patients may also have difficulty understanding the terms of these loans, leading to confusion and frustration. Additionally, there have been reports of potentially misleading credit card enrollment tactics used by some lenders.
“Consumer complaints to the CFPB suggest that, rather than benefiting consumers, as claimed by the companies offering these products, these products in fact may cause confusion and hardship,” the report concluded.
“77% of working Americans get health insurance through their employer, so that presents a unique ability for employers to have a positive impact here.”
Howard Michalski, medZERO President
“The CFPB has highlighted the financial hurdles faced by many employees in getting the care they need,” said Howard Michalski, medZERO president. “77% of working Americans get health insurance through their employer, so that presents a unique ability for employers to have a positive impact here.”
“We applaud the CFPB in issuing this report and providing transparency into this important issue,” said Craig Froude, medZERO CEO. “We are committed to offering a better solution for employees and believe that healthcare financing should be safe, accessible, and affordable. The statistics in the report are alarming, but at medZERO, we see it as a call to action to address the financial hurdles faced by many employees in getting the care they need.”
The medZERO program is offered exclusively through employers as an employee benefit, and designed in complete alignment with the needs of employer-partners with regard to enhancing the financial security and health and wellness of employees. Unlike medical credit card providers, medZERO doesn’t charge any interest or fees, and the terms and conditions are straightforward and easy to understand.
“We believe that offering an affordable solution for medical costs is a critical part of that effort. With medZERO, employers can help employees avoid falling into debt traps while improving their overall health and financial wellness.”
Craig Froude, medZERO CEO
“Employers have an important role to play in addressing the financial challenges that employees face in accessing care,” added Froude. “We believe that offering an affordable solution for medical costs is a critical part of that effort. With medZERO, employers can help employees avoid falling into debt traps while improving their overall health and financial wellness.”
For more information on medZERO and its healthcare financial wellness solutions for employers, please visit www.medzero.com.
medZERO is a healthcare financial wellness platform that provides employees with access to on-demand funds to pay for their out-of-pocket healthcare costs. Funds are repaid over time through payroll deduction. Employees with Health Savings Accounts repay using pre-tax dollars, which creates an added savings of up to 30%. medZERO’s solution provides significant cost savings to employers by reducing healthcare costs, improving employee health and retention, and reducing absenteeism.