Best Alternatives to Medical Credit Cards

medical credit cards

According to The Commonwealth Fund, the average U.S. resident paid $1,122 out of their own pocket for healthcare in 2019. Historically, this number increases every year. And unfortunately, it’s a lot of money, especially when it’s an unexpected cost

There is an option to use medical credit cards to cover those additional unexpected medical expenses, but they are not an ideal option for some people. Let’s take a closer look at medical credit cards to see if they work for you. 

How do medical credit cards work?

Medical credit cards are offered to cover medical expenses. Many times, you apply for the card right in the office. These are typically used to cover expenses in specific providers such as cosmetic surgeons, dentists, and veterinarians. 

They work very similarly to a regular credit card. If you owe your doctor a balance, you use the medical credit card to pay the doctor and now you owe the credit card company. 

Medical credit cards can only be used for healthcare with providers that accept the credit card. But what should you look for when considering a medical credit card? Let’s explore the most important factors! 

What should I consider when looking for a medical credit card

Medical credit cards have some benefits that you should take into consideration when deciding which lender is best for you. 

Deferred interest options

Not to be confused with 0% financing, deferred financing is a great way to avoid paying more than the initial costs for your medical procedure. Deferred financing gives you a period of time, which is typically six months before the accumulated interest is applied to your original amount. 

If you pay off your charges before the financing is in effect, you avoid paying any additional costs. This is offered on most medical credit cards but ensure that the card you select has this benefit. 

Make sure that you pay off your medical charges prior to the deferred interest coming into effect to avoid larger fees. Once the deferred interest period ends, you will pay the retroactive interest all at once and begin incurring interest on the existing balance. 

Long-term financing 

You could also consider the option of long-term financing when considering medical credit cards. Some credit cards offer an option of long-term financing with a lower interest rate and lower monthly cost. 

This is a great consideration if you have a higher balance that will likely not be paid off in a timely manner. You can take advantage of the lower interest rate and have set monthly payments. 

Interest rate

Keep in mind that a medical credit card can be very similar to a store credit card in the sense that they have higher interest rates. According to CareCredit, one of the most common medical credit cards, the interest rate could be 26.99% if you are not receiving a promotional rate. 

This could be a determining factor in choosing to use a medical credit card or even which company to choose. Though this rate is comparable to others, confirm that the card you’re considering offers promotional rates or even deferred interest rates to help offset the higher interest. 

5 best alternative options for medical credit cards

After looking into a medical credit card, you might figure out this is not the best option for you to pay your medical bills. Let’s look at some alternative options that might help you tackle the debt. 

Take out personal loans 

A personal loan is an option to pay your medical bills. You could apply for a loan through your bank or credit union and use the funds as you see fit. 

Best For: This is a good option for a long-term payment solution if you are unlikely to pay off the medical credit card before the promotional period or if your medical balance is on the more expensive side. 

Benefits: This is a great option if you want low payments over a longer period as personal loans tend to have lower payment options. They also tend to offer lower interest rates depending on your credit score and higher balances. You can also use the funds for other debts as a way to consolidate them into one monthly payment. 

Disadvantages: A personal loan could also have a higher interest rate if your credit score is lower which can cause higher monthly payments. Another disadvantage of personal loans is the potential requirement of collateral. 

Though this isn’t common for personal loans if your credit score is not high enough there is a chance that you will be required to provide an asset as collateral. This is not always preferable as putting anything up as collateral is a major risk. 

Finally, consider fees associated with personal loans. These typically incur if you miss a payment but there could also be a prepayment penalty if you pay the loan off early. 

Cost: Costs such as monthly payments depend on the amount of the loan. However, there are some pretty standard costs to take into account. 

There might be a one-time loan application fee that could range anywhere from $25 to $50. You might be required to pay an origination fee which is calculated into the principal balance of the loan as a percentage. 

Ask about payment plans 

Speak with your healthcare provider about arranging a payment plan when you owe for their services. This allows you to split up the lump sum over time. 

Best For: Payment plans are best for anyone if you can afford the monthly payment. 

Benefits: There are no credit checks associated with a payment plan. This is a benefit for someone who is concerned about how their credit score can impact their ability to finance. Another benefit is there is a set payment monthly that goes directly to the provider, there is no need to include any additional parties.  

Disadvantages: Payment plans are usually not an option for elective procedures. Typically those procedures require payment in advance. Payment plans monthly payments could still be unaffordable. 

They tend to take the full amount owed and divide it over a set amount of months and there might not be enough wiggle room to tailor the payment to what you can afford. 

Also, there could be strict payment rules. A missed payment could disqualify you from the payment plan option and require you to pay the remainder off immediately. 

Cost: There are no additional costs or fees associated with payment plans. 

Negotiate your bills 

Contact the biller directly and discuss negotiating the total costs and offer to pay the remainder upfront, typically using cash. 

Best For: Someone with cash on hand.

Having immediate cash on hand is the key to successfully negotiating a lower bill. 

Benefits: Negotiating gives you the potential not only to pay a lesser amount but also allows you to pay the balance off immediately. 

Disadvantages: Negotiating is not always the best option. Once you get in contact with the proper channels and plead your case, there is a chance that nothing will change and your efforts won’t work in your favor. 

You will also be expected to pay the amount all at once. Even if you are successful at coming up with a balance that works for you, you still have to pay off a debt upfront as opposed to paying it down eventually. 

Cost: There are no costs associated with negotiating your bill. 

Apply for a MoneyLion Credit Builder loan 

MoneyLion Credit Builder loan allows for up to a $1,000 loan that can be paid off within twelve months while also improving your credit score.

Best For: Smaller medical expenses as it allows for up to $1,000.

The Credit Builder loan is also great if you’re looking to improve your credit. 

Benefits: The MoneyLion Credit Builder loan allows you to not only get a loan but also build your credit. Also, you’re allowed 0% interest cash advances of up to $300, so this loan provides options. There are also no collateral requirements with this loan if you have a lower credit score. 

Disadvantages: There is a bank account required to ensure you can make the monthly payments, this could be a disadvantage to some. Also, the $1,000 is not available immediately, you receive a portion of the funds upfront. 

This is important if your medical payments are a bit higher, you might need to borrow more. Additionally, the loan is expected to be paid off in 12 months. 

Cost: There is a $19.99 membership fee in order to access the various benefits of MoneyLion. 

Take advantage of Instacash 

Instacash allows for up to $250 in cash advances with no interest.

Best For: Small medical bill, possibly an urgent care bill.

This is also a great option for someone who has had an unexpected small bill. Perhaps you weren’t expecting to pay a copay or you need to pay multiple copays, this is good for you. 

Benefits: Instacash does no credit checks. Have a low credit score? Don’t worry! This could be beneficial to you. You can also set up automated payments if you have a RoarMoney account. 

This adds convenience when it comes to paying back your loans. Finally, Instacash comes with no interest, meaning you’ll have a 0% APR. This means you’ll only have to pay back exactly what you owe! 

Disadvantages: Instacash does require the borrower to have a checking account that is active and at least 60 days old. Your Instacash limit will be 30% of your recurring direct deposit amount per cycle, not exceeding $250. This could be limiting to some depending on your monthly earnings. 

Cost: There is a fee depending on how soon you need the funds. For instant delivery to a RoarMoney account, you’ll need to pay a fee of $3.99 or $4.99 if you are depositing money into a non-RoarMoney account. 

Which option is best for you? 

Medical credit cards have many benefits, but it depends on your individual needs. There are a few different options for credit cards out there from CareCredit to AccessOne, each providing benefits to the owner, but medical credit cards are not the only way to pay medical bills. 

According to TransUnion, about 18% of Americans have medical debt in collections. If your medical debt gets to that point and you need a loan, there are options for you as well. Unexpected bills can really throw a wrench in your financial plans so it is best to do all you can to help. 

MoneyLion’s Safety Net is a great way to cover those unexpected bills and even medical costs. With Safety Net, you can track your expenses and have all your funds in one place. 

And if any medical bills surprise you, as long as you have two recurring direct deposits set up in your RoarMoney account. You have access to up to $1,000 in 0% APR cash advances.


Is a medical credit card worth it?

Yes, a medical credit card can be worth it depending on needs. However, low-cost alternative like a MoneyLion 0% APR cash advance is a much better option.

Does medical credit card affect credit score?

Yes, a medical credit card is still a credit card so it can impact your credit score. Keep in mind there may be a drop in your score when applying for the card. Your score could also drop if you miss a payment.

Do medical bills affect buying a house?

Yes, medical bills affect your credit score and your debt-to-income ratio which are both taken into consideration when you are looking to purchase a home

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