Advocates urge tighter rules for medical credit cards as providers and issuers warn of access impacts

The General Law Committee heard hours of testimony Feb. 18 on House Bill 5127, the measure aimed at curbing deceptive practices tied to so-called medical credit cards offered in provider offices.

Supporters from consumer groups and legal-aid organizations described repeated complaints that patients were signed up for promotional "0%" plans without full understanding. David Zhao, a public-interest attorney who testified from California, said consumers were sometimes signed up "while in the dental chair" and later surprised when deferred interest retroactively applied. "These practices have not stopped," he said, citing litigation and Consumer Financial Protection Bureau inquiries.

Speakers said the most harmful features include retroactive deferred interest (where interest is assessed on the original date if the promotional balance is not paid in full), limited disclosures at the point of sale, and instances where patients received charges for goods or services they did not request. Consumer Reports and legal-aid witnesses urged rules requiring clear, plain-language disclosures, prohibiting charges before the service is performed, and preventing providers from marketing or co-branding these credit products in clinical spaces.

Dentists, physicians and other providers testified that patient financing can be essential to delivering timely care. Kathleen Garrity of the Connecticut State Dental Association said many patients rely on financing to avoid delaying treatment and that practices routinely check coverage and offer options; she warned an overly broad ban could reduce access. Dr. Mariam Hakim Zargar, president of the Connecticut State Medical Society, urged the committee to target lenders' marketing rather than imposing burdens on physicians.

Representatives of Synchrony/CareCredit defended their product and training practices. Sue Bishop, Synchrony’s executive VP of corporate affairs, said providers must complete training, that the company monitors complaints, and that about "80% of our consumers pay off promotional balances and avoid interest." Synchrony said merchants pay a higher processing fee for promotional terms but denied paying providers incentives to enroll patients. The company described call‑back outreach to newly approved customers and remediation channels when disputed charges occur.

Committee members pressed both sides on specific mechanics: how deferred-interest promotions are applied, what fees providers pay, whether providers receive any incentives, and how many Connecticut residents are sued over these accounts. Witnesses acknowledged some litigation history (including the CFPB consent order that has since been revised) and said remediation and training are in place. Advocates countered that even with improved materials, the clinical setting remains a high-pressure context for vulnerable patients.

The committee did not take a vote. Members said they plan to continue meeting with stakeholders to shore up disclosure language, tighten prohibitions on point-of-sale marketing inside clinical settings, and consider whether additional limits or enforcement mechanisms are needed. The hearing produced a clear split: advocates urge stronger consumer protections to avoid retroactive interest traps and surprise billing; providers want to preserve financing options that facilitate access to care.