Medical Financing: What to Know About Care Now, Pay Later

Key takeaways:

Care Now, Pay Later (CNPL) is a medical financing option that allows you to pay for your healthcare expenses in installments.

Depending on the CNPL terms, you may be able to avoid interest and other financing charges.  

This healthcare financing option can help you get medical procedures more quickly and affordably with online approval, but you can end up paying much more because of interest or fees. 

You may have heard of the term “buy now, pay later” when purchasing retail items such as clothes, electronics, or furniture. But did you know that you can also use this method for healthcare expenses?

Care Now, Pay Later (CNPL) is a medical financing option that gives you time to pay healthcare expenses and loan approval online. It’s also known as Healthcare Now, Pay Later.

Medical debt is common. So is the lack of resources for healthcare costs. A Kaiser Family Foundation poll found that about half of the nation’s adults don't have enough money to cover an unexpected $500 medical bill. 

CNPL is one way to pay healthcare expenses in installments. But is CNPL a good idea? Let's take a closer look at this and other medical financing options to help you decide if CNPL is right for you.

Most people qualify for some type of medical financing. A few common eligibility conditions include:

Having medical expenses

Being at least 18 years old

Having a Social Security number (SSN) or individual tax identification number (ITIN)

Having income

Having credit history

In addition, your credit score could play a role in how much credit you receive and your interest rate. For example, if you have a poor credit history, you may be able to get approved for a loan, but your interest rate may be higher than someone with a better credit history. 

You may have several medical financing options. These include:

Medical credit card

Medical loan

Care Now, Pay Later, a type of medical loan program

Let’s take a closer look at each kind of healthcare financing arrangement.

A medical credit card is a type of credit card that you use specifically for healthcare expenses. Several companies offer this type of card.

Your medical credit card is similar to a regular credit card in that you'll have a credit limit and responsibility for monthly payments. But there are a few key differences:

Financing options: Medical credit cards often come with special financing options, like interest-free periods. In other words, you don’t owe anything extra if you pay off your balance within a certain number of months.

Repayment terms: If you don't pay off the balance before the promotional period ends, you'll be responsible for paying interest on the entire amount. 

Limited provider acceptance: You can only use medical credit cards with healthcare offices that accept that card. This can limit your choices when it comes to providers.

Interest rates and fees: In some cases, medical credit cards have higher interest rates than regular credit cards. If you carry a balance, you could pay much more than you originally borrowed. 

A medical loan is a personal loan that you use for healthcare expenses. They can cover medical and dental care such as: 

Chemotherapy and other ongoing treatment

Wisdom tooth removal

Infertility treatment

Weight loss surgery

Urgent care or emergency room treatment

Elective cosmetic surgery 

The interest rate and repayment terms vary depending on the lender. But you can typically expect to have a few years to pay off the loan.

One thing to remember about medical loans is that they’re usually unsecured. That means you don’t have to have collateral or an asset to secure the loan. Because of this, medical loans often come with higher interest rates and credit score requirements than secured loans.

If you're interested in a medical loan, your doctor's office might be able to help. Some providers offer loans directly to patients. These programs are popular with medical offices that specialize in elective procedures not covered by insurance, such as cosmetic surgery and LASIK.  

But if your healthcare provider doesn’t provide financing, don’t worry. You can also apply for a medical loan from a traditional bank, credit union, or online lender. You’ll want to compare each loan’s terms to ensure you get the best deal possible. Look at the interest rate (APR), fees, and payment amounts. Also, check to see how many months you’ll have to make payments and if there are any discounts if you pay off your balance in a certain time period. 

Care Now, Pay Later (CNPL) is a type of medical loan product available from certain lenders. Often, these are internet banks and not national or community brick-and-mortar institutions. 

The biggest benefit of a CNPL program is that you get the care you need now and pay over time — and often get approved quickly online. You often don’t need to use a certain provider. The repayment terms depend on the company, but you can typically expect to have monthly installments. 

CNPL is a growing industry. A 2021 survey released by medical financing companies showed that more than half of medical consumers wanted CNPL payment options for healthcare costs. Gen Z consumers, who are young adults, showed the highest interest at 82%.

Finally, keep in mind that you may be charged a late fee if you don’t make payments on time. And, if you miss a payment, you may be subject to additional fees or interest. Before you sign up for a CNPL plan, read all of the terms to make sure you know how your loan works.

They can be. CNPL programs are worth considering if you’ve been delaying care because of costs. This kind of payment arrangement can make healthcare affordable and prevent your debt from going into collections.

Remember that any type of medical financing is debt, which means you’ll have an additional cost in your monthly budget. If your financial situation is already tight, more debt may not work for you. In that case, you may want to consider other options, such as financial assistance programs.

No, you don't need good credit to qualify for medical financing. If you don’t have an ideal credit history, don't worry. You still may be able to get a credit card, loan, or Care Now, Pay Later arrangement. In fact, some CNPL companies offer plans to all consumers, no matter their credit score. 

The best way to finance your medical expenses depends on your needs. Several factors may influence your decision, including:

Credit score

Income

Amount you need to borrow

Time you need to repay

Payment accepted by your provider

To decide whether you choose a medical loan, medical credit card, or CNPL, consider each option’s interest rates and repayment terms. Be sure to read the contract carefully before you sign.

If you need financing to pay medical bills, Care Now, Pay Later (CNPL) may be your best option. Instead of a medical loan or medical credit card, CNPL could be the optimal way for you to make payments on a healthcare bill over time. Using CNPL may help you get approved quickly online without restricting use of the credit to certain providers. But it’s important to read the terms of your agreement carefully.

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This article is solely for informational purposes. This article is not professional advice concerning insurance, financial, accounting, tax, or legal matters. All content herein is provided “as is” without any representations or warranties, express or implied. Always consult an appropriate professional when you have specific questions about any insurance, financial, or legal matter.

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