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Reviewed by Emily Henderson, B.Sc. May 4 2023

The Biden administration on Thursday cautioned Americans about the growing risks of medical credit cards and other loans for medical bills, warning in a new report that high interest rates can deepen patients' debts and threaten their financial security.

In its report, the Consumer Financial Protection Bureau estimated that people in the U.S. paid $1 billion in deferred interest on medical credit cards and other medical financing in just three years, from 2018 to 2020.

The interest payments can inflate medical bills by almost 25%, the agency found by analyzing financial data that lenders submitted to regulators.

"Lending outfits are designing costly loan products to peddle to patients looking to make ends meet on their medical bills," said Rohit Chopra, director of CFPB, the federal consumer watchdog. "These new forms of medical debt can create financial ruin for individuals who get sick."

Nationwide, about 100 million people — including 41% of adults — have some kind of health care debt, KFF Health News found in an investigation conducted with NPR to explore the scale and impact of the nation's medical debt crisis.

The vast scope of the problem is feeding a multibillion-dollar patient financing business, with private equity and big banks looking to cash in when patients and their families can't pay for care, KFF Health News and NPR found. In the patient financing industry, profit margins top 29%, according to research firm IBISWorld, or seven times what is considered a solid hospital profit margin.

Millions of patients sign up for credit cards, such as CareCredit offered by Synchrony Bank. These cards are often marketed in the waiting rooms of physicians' and dentists' offices to help people with their bills.

The cards typically offer a promotional period during which patients pay no interest, but if patients miss a payment or can't pay off the loan during the promotional period, they can face interest rates that reach as high as 27%, according to the CFPB.

Patients are also increasingly being routed by hospitals and other providers into loans administered by financing companies such as AccessOne. These loans, which often replace no-interest installment plans that hospitals once commonly offered, can add hundreds or thousands of dollars in interest to the debts patients owe.

A KFF Health News analysis of public records from UNC Health, North Carolina's public university medical system, found that after AccessOne began administering payment plans for the system's patients, the share paying interest on their bills jumped from 9% to 46%. Related StoriesUniversity Hospital Bonn coordinates eWHORM project to combat worm infections in sub-Saharan AfricaMGI and South Australian Genomics Centre Introduce DNBSEQ-T7 to Supercharge Genomics Research in AustraliaPediatric hepatology experts join Hassenfeld Children's Hospital to deliver family-centered care to children with liver disease

Hospital and finance industry officials insist they take care to educate patients about the risks of taking out loans with interest rates.

But federal regulators have found that many patients remain confused about the terms of the loans. In 2013, the CFPB ordered CareCredit to create a $34.1 million reimbursement fund for consumers the agency said had been victims of "deceptive credit card enrollment tactics."

The new CFPB report does not recommend new sanctions against lenders. Regulators cautioned, however, that the system still traps many patients in damaging financing arrangements. "Patients appear not to fully understand the terms of the products and sometimes end up with credit they are unable to afford," the agency said.

The risks are particularly high for lower-income borrowers and those with poor credit.

Regulators found, for example, that about a quarter of people with a low credit score who signed up for a deferred-interest medical loan were unable to pay it off before interest rates jumped. By contrast, just 10% of borrowers with excellent credit failed to avoid the high interest rates.

The CFPB warned that the growth of patient financing products poses yet another risk to low-income patients, saying they should be offered financial assistance with large medical bills but instead are being routed into credit cards or loans that pile interest on top of medical bills they can't afford.

"Consumer complaints to the CFPB suggest that, rather than benefiting consumers, as claimed by the companies offering these products, these products in fact may cause confusion and hardship," the report concluded. "Many people would be better off without these products."

This article was reprinted from khn.org with permission from the Henry J. Kaiser Family Foundation. Kaiser Health News, an editorially independent news service, is a program of the Kaiser Family Foundation, a nonpartisan health care policy research organization unaffiliated with Kaiser Permanente.

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Russia accused of escalating hybrid attacks in Europe after Baltic Sea telecoms cables cut

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Russia accused of escalating hybrid attacks in Europe after Baltic Sea telecoms cables cut

Russia has been accused by European governments of escalating hybrid attacks on Ukraine’s Western allies after two fibre-optic telecommunication cables in the Baltic Sea were severed.

Russia is systematically attacking European security architecture,” the foreign ministers of the UK, France, Germany, Italy and Poland said in a joint statement.

“Moscow’s escalating hybrid activities against NATO and EU countries are also unprecedented in their variety and scale, creating significant security risks.”

The statement was not made in direct response to the cutting of the cables, Reuters reported, citing two European security sources.

War latest: Ukraine fires six US long-range missiles at Russia, Moscow says

Germany’s defence minister Boris Pistorius said: “No one believes that these cables were cut accidentally.”

He added: “We also have to assume, without knowing it yet, that it is sabotage.”

Investigations have been launched into the destruction of the cables earlier this week.

One linked Finland and Germany while the other connected Sweden and Lithuania.

Russia has repeatedly denied it has sabotaged European infrastructure and has accused the West of making such claims to damage Russian interests.

Read more:
Is Putin ready to reach for the nuclear button?
Where do Russia and Ukraine stand militarily now?
Why UK missiles would only have marginal effect on Russia

Investigations launched into possible sabotage

One cable was damaged on Sunday morning and the other went out of service on Monday.

The Swedish Prosecution Authority has launched a preliminary criminal investigation into the damaged cables on suspicion of possible sabotage.

The country’s civil defence minister Carl-Oskar Bohlin said its armed forces and coastguard had picked up ship movements corresponding with the damage to the cables.

“We of course take this very seriously against the background of the serious security situation,” he said.

Finland’s National Bureau of Investigation said it had also launched an investigation, but Sweden would lead the probe.

NATO’s Maritime Centre for the Security of Critical Undersea Infrastructure was working closely with allies in the investigation, an official said.

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Baltic Sea infrastructure damaged

It is not the first time such infrastructure has been damaged in the Baltic Sea.

In September 2022, three Nord Stream gas pipelines between Russia and Germany were destroyed seven months after Moscow invaded Ukraine.

No one took responsibility for the blasts and while some Western officials initially blamed Moscow, which the Kremlin denied, US and German media reported pro-Ukrainian actors may have been responsible.

The companies owning the two cables damaged earlier this week have said it was not yet clear what caused the outages.

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Jeremy Clarkson says government should ‘back down’ on farmers’ inheritance tax as he joins protest

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Rays say new stadium unlikely to be ready by ’28

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Rays say new stadium unlikely to be ready by '28

ST. PETERSBURG, Fla. — A combination of severe hurricane damage to Tropicana Field and political delays on financing means it is highly unlikely the Tampa Bay Rays‘ planned new stadium will be ready for the 2028 season, if at all, the team said Tuesday.

Rays top executives said in a letter to the Pinellas County Commission that the team has already spent $50 million for early work on the new $1.3 billion ballpark and cannot proceed further because of delays in approval of bonds for the public share of the costs.

“The Rays organization is saddened and stunned by this unfortunate turn of events” said the letter, signed by co-presidents Brian Auld and Matt Silverman, who noted that the overall project was previously approved by the County Commission and the City of St. Petersburg.

“As we have made clear at every step of this process, a 2029 ballpark delivery would result in significantly higher costs that we are not able to absorb alone,” the letter added.

The tumultuous series of events came after Hurricane Milton ripped the roof off Tropicana Field on Oct. 9, forcing the Rays to play the 2025 season at the spring training home of the New York Yankees, 11,000-seat Steinbrenner Field in Tampa. Then, the Pinellas County Commission postponed a planned Oct. 29 vote on the bond issue that the Rays said has thrown the new 30,000-seat ballpark timeline off.

The commission was meeting again Tuesday on the bond issue, but its chair suggested a vote could be delayed again.

“We know we’re going to be in Steinbrenner in 2025 and we don’t know much beyond that,” Auld said in an interview.

Asked if Major League Baseball can survive long-term in the Tampa Bay area, Rays Principal Owner Stuart Sternberg said the outlook is “less rosy than it was three weeks ago. We’re going to do all that we can, as we’ve tried for 20 years, to keep the Rays here for generations to come.”

The team’s contract with the city of St. Petersburg requires that the Rays play three more seasons at Tropicana Field assuming it is repaired. The cost of fixing the ballpark in time for the 2026 season is pegged at more than $55 million for a building scheduled to be torn down when the new facility is ready.

Under the original plan, Pinellas County would spend about $312.5 million for the new ballpark and the city of St. Petersburg around $417 million including infrastructure improvements. The Rays and their partner, the Hines development company, would cover the remaining costs including any overruns.

It isn’t just baseball that is affected. The new Rays ballpark is part of a larger urban renovation project known as the Historic Gas Plant District, which refers to a predominantly Black neighborhood that was forced out by construction of Tropicana Field and an interstate highway spur.

The broader $6.5 billion project would transform an 86-acre (34-hectare) tract in the city’s downtown, with plans in the coming years for a Black history museum, affordable housing, a hotel, green space, entertainment venues, and office and retail space. There’s the promise of thousands of jobs as well.

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