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Medical Credit Cards and Credit Scores

by: Sean Michaels

Update: 09/2021


Medical Credit Cards and Credit Scores
Access to quality healthcare has been getting more expensive every year. This trend has lead to the rise of a new type of financial product, the medical credit card. These card offers seem to be at every doctor, dentist, and specialist office in the country. This should come as no surprise, as getting people to pay their bills is one of the hardest parts of running a medical practice. Medical credit cards mean that the provider gets paid right away and the credit card company has to deal with making sure the patient pays there bills.

If you need a medical procedure and either don’t have insurance or your insurance doesn’t cover the procedure, then you might be tempted to sign up for one of these products. We’ll go over the pros and cons of medical credit cards so you can make an informed decision that benefits your financial well-being as well as your physical health. Please note, this is not intended to be medical advice, and you should always consult a qualified healthcare professional regarding the best procedures for your particular health situation.

What is a Medical Credit Card?

A medical credit card is a specialized form of credit card that can be used to pay for healthcare services. These products are somewhat similar to a store credit card that a retail shop might offer you. The products are similar in that the line of credit you’re offered can only be used for specific types of purchases. With the medical credit card, it can only be used to pay for health care services, whereas a store credit card can only be used on purchases from that store or chain. This stands in contrast to a regular credit card, which can be used for any kind of transaction so long as the merchant or service provider accepts that type of card as payment.

Medical and store credit cards are also similar in that they use similar marketing strategies to get people to apply for and accept the credit offer. The most common sales tactic is offering a period of deferred interest. Deferred interest is a financial process that waives the need to pay off accumulated interest, so long as the balance is paid off within the promotional period. For example, if you buy $5,000 worth of services from a healthcare provider on a card that has 12 months deferred interest, and you pay off the balance before the 12-month period, then you won’t pay any interest charges at all. These marketing tactics are the center of both the benefits of medical credit cards, and their potential hazards.

The Benefits of Medical Credit Cards

Medical credit cards offer several potential benefits to consumers. First, medical credit cards give people a way to pay for the healthcare services they need when they don’t have the cash on hand or savings to cover those medical services. A medical credit card can be a necessity if your healthcare provider isn’t willing or able to work out a payment plan for the health care services you require to get better or stay better.

Additionally, if you are able to pay off the balance on the card before the deferred interest period ends, then these cards can be a great way to save money on expensive healthcare procedures your insurance doesn’t cover. Deferred interest can be a great deal for consumers if they are confident that they’ll be able to cover the balance. Depending how much money you’re charging to the card, the deferred interest offers could save you thousands of dollars in interest payments.

The Potential Hazards of Medical Credit Cards

Despite the potential benefits that medical credit cards bring to the table, there are some potential hazards. The first issue to avoid is using the medical credit card instead of a regular credit card or just paying a healthcare bill out of pocket. Consumers can be tempted to put healthcare expenses on the card so that they have more spending money in their pocket, but these charges can add up quickly. As a result, you could end up increasing the amount of real money you’re spending on healthcare in the long term by a substantial margin.

Another potential drawback of medical credit cards has to do with the deferred interest period. The minimum payment on these cards is always less than the amount it will take you to cover the balance before the deferred interest period ends. Therefore, if you’re only making the minimum payment, you’re going to be hit with all of the interest charges you accumulated over the promotional period.

It’s important to note that last sentence; if you do not pay your balance off before the end of the promotional period, then all of the interest you would have accumulated over that period is applied to your balance. You don’t get charged based on your current balance. The interest rates on these cards are frequently higher than other credit cards, so your balance could be ramped up in a big way.

Understanding How Medical Credit Cards Affect Credit Scores

Medical credit cards affect your credit much like other credit products. They are considered to be a revolving line of credit. The limit and balance on a medical credit card are factored into your total available credit and utilized credit just like any other credit card. If you keep your balance low, than a medical credit card can help boost your score by lowering the amount of available credit you’re using. However, if you fail to pay off the balance before the promotional period ends or continue to add new charges to the card, then your credit rating can plummet, as you have added to your total debt and possibly increased your available credit utilization.


When it comes to medical credit cards, the real question is how disciplined you can be when it comes to paying the balance. If you’re able to cover the balance before the deferred interest period ends and can keep a low or zero balance on the card, then your credit score stands to benefit from a medical credit card. However, if you have problems making more than the minimum payment, then a medical credit card is likely to cost you in the long run.

Sean Michaels

Sean brings a decade worth of experience in credit repair to our company. Sean started his career working in an accounting department for a major credit card company. This was a natural fit, given his bachelor’s and master’s degrees in accounting.