Patients risk going into debt by signing up for ‘buy now, pay later’ private health care

Patients facing long NHS waiting lists for scans and tests are spiraling into debt by signing up for loans and ‘buy now, pay later’ deals for private healthcare.

In exchange for prompt treatment, patients must pay years of installment debt for their medical treatment — including MRI scans, X-rays, routine surgeries and hip replacements.

Companies like MRI Plus, which offer payback deals, tell patients, “Why wait with pain? Reduce your waiting time for treatment on the NHS’ and ‘book now, pay later’.

Another loan provider, Chrysalis Finance, offers ‘quick and easy’ loans between £350 – £25,000 – and allows payments to be spread over five years.

Scan.com, which offers MRIs, CT scans, ultrasounds and X-rays in 150 centers nationwide, is offering an interest-free BNPL option through PayPal.

The companies said the BNPL plans are ethical, interest-free options that help people manage their finances.

But debt campaigners and health experts are concerned NHS backlogs could force people to desperately use the deals.

David Rowland, director of the Center for Health and public interest think tank, said: ‘Policy makers need to be aware of how underfunding of the NHS is pushing unsustainable healthcare costs back onto individuals, potentially increasing their debt. It’s a slippery slope.

Research by the charity StepChange found that nearly half of people with a BNPL loan were struggling to keep up with household bills and loan payments, while 17 per cent met the charity’s definition of being in serious financial distress. be.

In some cases, customers face late payment fees and risk damaging their credit or being referred to collection agencies. While traditional loans are regulated by the Financial Conduct Authority, interest-free loans that are paid back in less than 12 months – including BNPL products – are exempt.

For patients, access to credit amid the current NHS backlogs could be the difference between enduring months of pain and anxiety or not.

Figures from NHS England show that as of May 2023, a record 7.47 million people were waiting to start routine hospital treatment, and more than 409,000 were waiting six weeks or more for key diagnostic tests.

Anusha Stribbling, 25, a charity worker from Peckham, south London, said she paid £760 with Klarna for two scans after suffering abdominal pain and difficulty accessing diagnostic tests on the NHS. She said the results helped her GP rule out other conditions and she was diagnosed with hypermobility and would “without a doubt” use it again for treatment in the future.

File photo of an operation taking place in an NHS hospital

Klarna said BNPL was a fairer, cheaper alternative to credit cards, with less than 1% of customers not paying back the money they owed.

MRI Plus said it offered low-cost scans that helped people gain “timely access” to potentially life-saving care and that customers had passed affordability checks.

A spokesperson for Chrysalis Finance said:

“As a responsible lender, authorized and fully regulated by the Financial Conduct Authority, we only lend to people who can demonstrate the ability to make monthly payments.

‘We don’t offer buy now, pay later financing. Instead, we have worked with regulators and the UK government to phase out unregulated BNPL (buy now, pay later) loans.

“Every application for our financing is thoroughly checked for creditworthiness and affordability before each loan, just like with other large-scale regulated lenders.

“Finances give people access to privately funded treatments by spreading the cost over affordable monthly payments, often with no interest charges. This choice to spread costs has been welcomed by many of our customers and is reflected in our high Trustpilot score and online feedback.”

PayPal said it “believes in responsible lending,” adding that its “pay in three” deals interest-free loans are “designed to give customers more choice and flexibility,” with no late fees or other charges. The company said it worked to “encourage people not to buy items they can’t afford.”

The Ministry of Health and Social Care said it was working with the independent sector to expand diagnostic capacity across the country “quickly, closer to home and free where needed.”