With medical debt and consumer complaints on the rise, GE Capital Retail Bank has agreed, through a settlement with the New York Attorney General's office, to increase consumer protections for patients who sign up for its CareCredit medical credit cards.
Monday's settlement helps stop providers "charging large, upfront fees for future services and from glossing over the huge interest rates associated with CareCredit when promoting the credit card to patients," New York Attorney General Eric Schneiderman told the Associated Press.
Health credit cards, which patients most frequently apply for while at the doctor's or dentist's office, have long been under scrutiny for luring patients in with low- or no-interest introductory rates, which skyrocket to as high as 27 percent after their promotional period. What's more, according to Schneiderman and his predecessor Andrew Cuomo, patients who sign up for the cards often mistakenly believe that they're signing up for no-interest payment plans directly with their medical providers, rather than with GE or another creditor, the AP reported.
Under the settlement, providers who offer the cards will not only be required to more clearly disclose the terms of this financing option, but they will also be limited in how much they can charge patients using the cards in advance of providing services, noted Reuters.
In addition, the agreement stated that CareCredit "will not give kickbacks, rebates, compensation, or in-kind services" to any healthcare provider in exchange for its success in generating card business, according to the AP.