Dental Offices Now Offer Credit Cards

Dental Offices Now Offer Credit Cards

This week we learned that 10 health care providers in New York, mostly dental offices, have been marketing credit cards to their patients. Actually, it seems that marketing is not exactly the right way to describe what they’ve been up to and now NY Attorney General Andrew Cuomo wants to get to the bottom of it.

Cuomo initially subpoenaed GE Money, the issuer of CareCredit, which is the card under scrutiny, as well as 10 health care providers who were pressuring patients into accepting it, using “fast-talking sales pitches and deceit,” as the AG office alleges.

Now we learn from Bloomberg that the investigation has expanded and subpoenas have been sent to units of JPMorgan Chase and Citigroup. Cuomo’s allegation is that:

People are being tricked by misleading offers that have them paying for services they never received as well as interest charges they never knew about, and they are ignored and given the runaround when they try to get their money back.

The CareCredit cards are offered as a way to cover out-of-pocket costs. They come with introductory zero-percent interest rates, however Cuomo alleges that they often carry retroactive interest of over 25 percent if the balance is not paid in full during the promotional period.

GE Money charged health care providers a fee for the right to offer CareCredit cards, and then paid them rebates, based on how much patients were charged, according to Cuomo. He alleges that these rebates amount to “kickbacks.”

So what are we to make of this story? Obviously, we don’t know how it will play out and it may well turn out that none of the parties under investigation will be found guilty of anything, but regardless of the outcome, one key point stands out. It is that health care providers are allowed to offer financial services on their premises.

This is wrong!

When I go to my dentist, I expect to get a cleaning or a filling, but not a credit card sales pitch. It is easy to imagine how people could get concerned that, if they refused the offer, they might get a different treatment. And their concern may well be justified, because in effect the CareCredit turns some patients into a more profitable group of customers. Now, hospitals and doctors’ offices already see patients as customers and that is the bigger problem.

Hopefully Cuomo will be able to shut down CareCredit’s credit card program or at least get the health care providers out of it, but we need a more permanent solution than that.

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