In life we can plan for a lot of things – birthdays, holidays, rent – but what most of us aren’t prepared for are unexpected medical bills. So when tragedy strikes, we may not have enough saved up to cover the costs. 
In fact, two-thirds of Americans regularly worry about not being able to pay expensive medical bills, and it’s not hard to see why. On average, a three-day hospital stay costs $30,000.
So, when an unexpected trip to the emergency room leaves you owing tens of thousands of dollars in medical fees, what can you do?
One option available is using your credit card to pay for your medical bills. It’s actually a pretty common method of paying, as a recent Experian survey found that 54% of customers said they preferred to pay for their medical bills using their credit card.
It may be a quick fix, but there are some things you’ll want to be aware of before reaching for your credit card.
Medical bills are usually pretty high fees – treating a broken leg can cost $7,500 – but paying with a credit card can leave you with high-interest debt that can be pretty hard to pay off.
Before you use your credit card it’s good to know that medical debt is treated differently to credit card debt.
When you miss a credit card payment, the issuer can report a late payment as soon as it’s past the 30 day due date which negatively impacts your credit score.
However, medical debt has no effect on your credit score until the provider sends the bill to collections – this can take as long as 60, 90 or 120 days.
Even after collection has been notified, there’s still more time. Most major consumer credit bureaus (TransUnion, Experian etc) won’t report medical debt until it’s past the 180 day due date.
They do this as it can take a while for health insurance companies to approve medical claims. However, if you pay any medical bills using your credit card you’ll lose out on the 180 day grace period as it becomes just regular credit card debt.
Also, you’ll no longer have the opportunity to dispute charges or negotiate a payment plan.
So make sure you evaluate your options before rushing to pay any medical bills. It’s unusual that a medical bill has any errors, but first make sure the costs are correct.
For instance, your insurance may not have paid for a procedure that they should’ve covered the costs for. Talk to your insurance provider to resolve any issues, and ask them to confirm how much of the bill is your responsibility to pay.
If you are/need to go down the avenue of paying your medical bills with a credit card there are some ways you can avoid being left with extortionate credit card debt to pay off.
Your best option is to sign up for a 0 percent intro APR card. These cards offer a temporary zero-interest period that lasts at least a year. This will give you time to pay off your medical bills before any interest is applied. This is the best method for putting medical bills on credit.
What you absolutely don’t want to do is use a high-interest credit card to pay for your medical bills.
When paying a large bill with one of these cards a lot of extra money will be added to your debt because of the interest being applied – you’ll end up paying back a lot more than what your bill originally asked for.
If you need to use a high-interest credit card apply for a balance transfer credit card as soon as you can. Just like the 0 percent intro APR card, using a best balance transfer credit card will give you a year or more to pay off your bill without any interest being applied.
Just like any other debt, medical debt can damage your credit history and lower your score if it’s not managed properly. So you’ll want to be extra careful when using a credit card to pay a medical bill because as soon as it’s paid, it becomes part of your credit history.
If you start missing credit card payments because of medical debt, your credit score can take a serious hit. This will affect your debit-to-credit ratio, and can affect any mortgage or loan applications or could prevent you from being able to rent the house/apartment you want.
If you choose to work out a payment plan with the hospital instead, this won’t negatively impact your credit score. Medical providers don’t report medical debt to the major credit bureaus.
They do, however, include on-time payments into your credit report as proof of a positive payment history.
It’s worth noting that if you do fall behind on paying installments to the hospital this can show up on your credit report, unless you negotiate a settlement.
If you find yourself slapped with an unexpected medical bill, don’t rush into paying it off instantly. You have some time to consider your options. Here are some other ways you can pay a hospital bill without a credit card:
Negotiate a payment plan: A lot of hospitals and medical care providers will agree to create a payment plan that you’ll be able to afford. So instead of paying off your bill in one lump sum, it’ll be payable in installments.
Apply for a medical loan: Medical loans help a lot of people cover unexpected medical expenses, and often have lower interest rates than credit cards.
Apply for a personal loan: Just like medical loans, personal loans offer lower interest rates than credit cards – especially if you have good credit.
Ask to borrow from friends and family: 60% of Americans say they have lent cash to help out a loved one. If you have people willing to help you out during a tough situation, don’t be afraid to ask.
