77 percent of Americans cannot afford an unexpected medical bill of $2,000 or more. For families on a budget, it's a sudden expense that can break the bank. But for the hospitals who provided the service, it can often mean going unpaid.
In a new move, some hospitals are eliminating the middle man and offering interest-free loans directly to their patients. It's a strategy that has helped people like David Rayman.
Despite having health insurance, Rayman was hit with a $2,800 bill for surgery to have a golf-ball sized lump on his neck removed.
"It was kind of a shock, you feel kind of helpless," Nicole Rayman, David’s wife, told NBC News.
The family couldn't afford to pay the surprise bill right away. But they spotted a phone number for a payment program.
Like many other hospitals, the one where Rayman had his surgery partners with banks to become a lender. The hospital was able to enroll the Rayman family in a 0 percent loan for 36 months.
"Instead of paying $2,800 right off the bat, it breaks down to $80 a month,” Rayman said.
The impact has become more manageable for the family, and the interest-free loan does not include any fees or surcharges.
"That's going out to dinner one time a month, so that's definitely something we could cut out," said Nicole Rayman.
Finance professionals advise patients to explore all options before taking out any type of loan.
“While that zero interest might seem very attractive, it's not a substitute for figuring out what you can afford,” said Michael Miller, Director of Strategic Policy for Community Catalyst, a non-profit organization in Boston.
Experts also recommend patients first negotiate the original bill with the insurance company before taking out a loan. If patients take out a loan from the hospital, reading the fine print is essential — failing to make payments could result in fines and penalties, as well as damage to credit scores.
For the Raymans, the hospital loan made financial sense.
"We can truly focus on being a family and being healthy and being together."