Health care credit card scheme preys on seniors and vulnerable patients

NEW YORK, NY (August 9, 2010) - Attorney General Andrew M. Cuomo today announced the expansion of an industry-wide investigation into predatory health care lending where consumers, especially seniors and vulnerable patients, are misled about financing, causing them to be pushed into debt.

An investigation by Attorney General Cuomo found that some health care providers use fast-talking sales pitches to pressure and deceive consumers into applying for health care credit cards such as Chase Health Advance, Citi Health, and GE Money’s CareCredit. The investigation also found that CareCredit pays kickbacks in the form of rebates to the providers based on how much business they charge consumers on CareCredit cards.

The investigation was based in part on hundreds of consumer complaints received by the Attorney General’s Office. Consumers reported that health care providers promised that the credit card had “no interest, ” when it often carried retroactive interest of over 25 percent if not paid in full during a promotional period. Consumers were also unknowingly charged up front for services they never received, and their attempts to obtain refunds were often thwarted or ignored. Meanwhile, the credit card companies typically paid the health care providers in full within 48 hours of the charge.

The investigation also found that CareCredit charges the providers a fee for the right to offer the cards, and then rebates part of the fee based on the amount of money the providers generated through CareCredit sales. This kickback arrangement, plus CareCredit’s payment in full to providers within two days of the charge, creates an incentive for providers to push consumers to use CareCredit rather than other methods of payment. In fact, providers pushed CareCredit over cash.

“Our ongoing investigation has uncovered conflicts of interest and predatory practices in the health care industry that are hurting New Yorkers and patients across the country,” said Attorney General Cuomo. “Patients are being misled into paying for services they never received by the people they should be able to trust the most - their doctors. Doctors are supposed to represent patients, not credit card companies, no matter what kind of kickbacks they are offered.”

Cuomo issued subpoenas to 14 dental and health care clinics that promote CareCredit, as well as to GE’s CareCredit, Chase Health Advance, and Citi Health Card. The subpoenas seek marketing materials, applications, terms of credit, contracts and rebate agreements, policies and procedures, consumer complaints, and regulatory inquiries. This investigation is ongoing.

In addition, Cuomo is asking several nationwide and state-based medical associations, including the American Dental Association and the New York State Dental Association, to explain why they endorsed CareCredit and whether they received compensation for doing so.

CareCredit is accepted by more than 125,000 health care practices nationwide. The New York State Dental Association asserts that more than 8 million dental patients and 80,000 dental practices use CareCredit nationwide. The credit card is advertised as a way to pay for services often not covered by insurance, including:

Chiropractic procedures
Cosmetic procedures
Dental procedures
Infertility treatment
Hearing procedures
Vision procedures
Weight loss procedures
Veterinary services

In recent years, Attorney General Cuomo’s Office received hundreds of complaints from consumers indicating that they were lured and misled by providers into applying for, accepting, and using health care credit cards. Among the complaints received by the Attorney General’s Office regarding the scam:

A Nassau county woman went to a dental provider covered by her insurance for a root canal. The dentist told her that she had serious dental problems and needed $14,000 worth of work. When the consumer told the dentist she could not afford $14,000, the dentist said he would not do the root canal unless she applied for CareCredit. The following day, the consumer received a bill for $13,900 even though none of the work was performed.
An elderly Brooklyn resident was advised by her dentist that she needed extensive dental work. The consumer agreed to allow the dentist to check her credit. A few days later, she received a bill from CareCredit for $6980. No dental work was performed.
A Bronx resident had $17,500 worth of implants charged to a CareCredit account up front by a dental provider. The provider went out-of-business before completing the work. CareCredit repeatedly refused the consumers requests to refund the money.

Chuck Bell, Programs Director for Consumers Union, nonprofit publisher of Consumer Reports, said, “Attorney General Cuomo’s investigation shines a badly-needed spotlight on deceptive practices used to market health care credit cards to elderly and low-income consumers. We are concerned that some health care providers are aggressively marketing these high-interest credit cards to patients, without providing appropriate disclosures, protections, or refunds. Consumers Union strongly supports the Attorney General's investigation, and applauds his ongoing efforts to protect consumers across the nation.”

Catherine Dunham, President of The Access Project, a resource center for local communities working to improve health and health care access, said, “With the cost of health care already an enormous burden on Americans, we must do everything we can to filter out abusive or deceptive practices in how providers take payment for care. Attorney General Cuomo’s investigation into health care credit cards will help protect millions of patients across the country who are struggling with debt. We applaud his efforts and look forward to continuing to partner with him to protect patients.”

Consumers wishing to file complaints regarding deceptive health care credit card practices are urged to contact the Attorney General’s Office at or 800-428-9071. Consumer tips and more information about the investigation, including an example of the letters sent to trade groups, can be found online at

The investigation is being conducted by Assistant Attorney General Carol Hunt of the Health Care Bureau under the supervision of Special Counsel to the Attorney General Linda A. Lacewell.

Subpoenas to Health Care Providers:

Allcare Dental Management Inc. - Buffalo
American Laser Centers - Farmington Hills, MI
Aspen Dental Management, Inc. - East Syracuse
East Syracuse Family Dental Arts - East Syracuse
Laser Cosmetica - New York City
Lifestyle Lift - Troy, MI
Northern Lights Chiropractic - Watertown
S & Y Diamond Dental P.C. - Brooklyn
Sunshine Dental - Watertown
Toothsavers - New York City
Gentle Dentistry - East Aurora
Judd Lesser, DDS - Hewlett
Concerned Dental Care of Westchester P.C.
Bernie Fialkoff DDS - Queens

Letters to Groups Endorsing CareCredit:

American College of Eye Surgeons
Society for Excellence in Eyecare
American Dental Association
Academy of General Dentistry
American Academy of Periodontology
American Association of Oral & Maxillofacial Surgeons
New York State Dental Association
American Society of Plastic Surgeons
American Society of Dermatologic Surgery
American Animal Hospital Association
New York State Veterinary Medical Society
American Hearing Aid Associates
American Society of Bariatric Physicians
Lite and Hope


  1. I have had the same experience in Albany, New York with Aspen Dental and care credit. My entire credit limit of $2000 was charged when I only had $350 woth of work done. When I received my first bill it was way more than I expected and more importantly could afford. I could not pay the required amount, I was then charged the default interest, and ended up having to pay another $2000 in fines and fees on top of the full $2000 they charged for my $350 worth of work. Six months later after paying off collections I received a very non-descript aspen dental letter which stated I had a $1700 credit to my account. I figured the plain looking envelope was an advertisement and did not open it until 2 weeks ago and finally became wise as to what the heck happened. I don't know if I have any recourse in this matter to get my $2000 in fines and fees back or to correct this mark on my credit. I got hosed.

  2. I'm elderly with hearing & vision challenges, accepted FREE exam offer from All American HEARING on 7/29/10, didn't realize their paperwork included a CareCredit form until I rec'd card in mail, Wasn't told my personal ID was to be given to 3rd party. Transaction supposedly was cancelled but I'm told by CareCredit I'll be sent a bill even though I did not get merchandise. I asked American Hearing if I could use my own credit union and was told they don't do business that way, in other words I had to go through CareCredit. Left a letter at All American Hearing office today 8/14, stating if I can't get my personal info deleted from CareCredit files I will send copy of my letter to BBB & Attorney General's office. Don't know what else to do at this point.

  3. I have had problems with the Care Credit as well. I was told that all of $1500 of work would be intrest free for the 18 months but to find out later that the dentist did not bill the amout all at once so only $200 of my bill was deffered interest. I tryed to get this straightened out at the dentist office with no help resulting in 23% interest that I am still trying to pay a year later. Futher more my first bill was late so i got a $40 late fee assesed to my account. What a scam, Don't use Care Credit!!!!
    Denver Colorado


Post a Comment