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Predatory Billing Practices Aren't Widespread, But Remain a Concern

Analysis  |  By Jasmyne Ray  
   April 09, 2024

Some federal agencies have voiced their concerns about medical payment products potentially taking advantage of patients.

With patients covering more of their health costs, health systems have begun efforts to make their billing and payment processes as easy as possible, from accepting cash-sharing applications as a payment method, to payment and financing options where the balance can be paid off over a period time with little interest added, if any.

Despite the flexibility that financing and payment plans offer, concerns have been raised about their rise in prevalence and systems potentially taking advantage of patients.

A new study from researchers at the University of Southern California revealed that while many hospitals promote different medical payment products (MPPs), of the 20% random sample of hospitals used for the study, fewer than one in 10 promote them to patients. The sample included nongovernment, short-term general, and surgical hospitals.

Non-profit institutions with high rates of uncompensated care costs were found to be more likely to promote interest-bearing payment plans, while interest-free payment plans were more commonly offered by 87% of facilities in the study.

While the use of MPPs doesn’t appear to be overtly predatory, that doesn’t mean systems should be nonchalant about their utilization.

Last summer, the Consumer Financial Protection Bureau, alongside CMS, HHS, and Department of the Treasury, issued a request for information regarding “medical credit card, loans, and other financial products used to pay for health care.”

Price transparency and estimates have assisted in increasing transparency for patients regarding what they’re paying for, as well as ensuring billing statements are simplified in a way that patients can understand.

“Healthcare billing continues to be a complex process especially since you have the provider, patient, and payer all involved,” Chris Johnson, vice president of revenue cycle at Atrium Health, previously told HealthLeaders.

“Quite frankly, when some patients see an insurer’s use of CPT and ICD-10-CM codes, it can be like a foreign language, and it can cause real confusion.”

Jasmyne Ray is the revenue cycle editor at HealthLeaders. 


Medical payment products (MPPs) are growing in utilization, and federal entities have voiced concerns about their potential to take advantage of patients.

Of the hospitals used in the study, the non-profit institutions were found to be more likely to promote interest-bearing payment plans.

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