CREDIT CRUNCH The out-of-pocket costs of surgery often leave patients in a financial jam.

By now, you've probably heard the news about CareCredit, the healthcare credit card company that the Consumer Financial Protection Bureau fined $34.1 million for "unfair and deceptive enrollment and disclosure practices." In making the first public enforcement action against deferred-interest products, the CFPB alleges that patients signed up for CareCredit cards thinking they were interest-free and unaware that accruing interest kicked in if the full balance wasn't paid in full at the end of promotional periods ranging from 6 to 24 months.

The CFPB has imposed a potentially burdensome application process. CareCredit is now required to:

• enhance disclosures of the deferred-interest plan on applications and billing statements;
• warn patients in advance when the promotional period is ending; and
• contact patients within 72 hours of the initial transaction to explain the payment plan in detail and directly enroll customers — instead of letting facilities handle it — for certain transactions of more than $1,000.

There's fallout for you as well. Facilities that use CareCredit must provide plain-language disclosure forms to patients before they sign up for the card, and staff who market the cards to patients must undergo mandatory company-sponsored training.

The staff at the Physicians Care Surgical Hospital in Royersford, Pa., emphasizes CareCredit's interest-free grace period every time they mention the card, says Jennifer Ryan, CPC, the hospital's business office manager. So does Ashley Mamas, CPC, business office manager of the St. Augustine (Fla.) Surgery Center, who says patients often don't read every word of what can be confusing credit card applications. Ms. Mamas uses the payment calculator on CareCredit's website to create a spreadsheet listing payment options and how much patients would have to pay each month to settle debts in full before the selected promotional period expires. "It shows realistic payments, not the small minimal monthly payments that they're charged to stay current," she explains. Ms. Mamas has patients sign their spreadsheets so she has what they agreed to on file. She keeps the signed pages on hand to avoid potential You didn't explain the deal to me phone calls from miffed patients hit with surprisingly high bills.