Consumer-Driven Care - Credit and Health Care

The Aug. 31, NYT features business section piece “No-Interest Loans for Health Care.” It says more and more doctors and dentists are offering no-interest loans for 12 months or more to credit-worthy individuals for such elective procedures as Lasix, ceramic tooth implants, and cosmetic nose reconstructions, and it mentions UnitedHealth and others are moving into the health loan field with loans bearing rates of 12-13% or more. The hooker in many of these loan plans is a 20% default penalty.

Is this a sign of things to come? Is it desirable? Is it inevitable? Will it extend beyond elective procedures? It might. After all, U.S. credit markets are a $900 billion industry, and health care is just a drop in the credit bucket. There’s plenty of room to grow in. Credit-driven health care could become widespread because of high costs, high deductibles, and high co-pays. And 100,000 health professionals are already offering no-interest loans.

Earlier this year I interviewed Kenneth Bloem, executive chairman of MedDirect, LLC, a Grand Rapids, Michigan company founded in 2000 to provide loans for elective dental and medical procedures. Boehm is no fly-by-night operator. He has been COO or CEO of such prestigious academic institutions as the U. of Chicago, Stanford, and Georgetown and is a sought-after international health care consultant.

Bloem believes health care credit-needs will steadily grow. Under any reform scenario, he says, health plans, state government, and the national government can’t afford first dollar coverage. Regardless of what policy prescription evolves, Bloem maintains future health care funding will require sharing between patients, employers, and government and patient loans will be part of the mix.