Here's Why You May Want to Keep a Credit Card on File for Medical Bills

There are certain expenses in life that are pretty much unavoidable. We all need to pay for shelter, transportation, groceries, and healthcare.

The latter can be an exceptionally large expense. In 2021, Americans spent an average of $12,900 per person on healthcare. And between health insurance premiums, copays, deductibles, and medications, it's easy to see why.

Meanwhile, I make a point to pay all of my medical expenses with a credit card. That way, I can rack up rewards or cash back on those necessary bills.

But I recently learned the hard way that not keeping a credit card on file with my pharmacy could result in a major headache. So I've since changed my ways, and you may want to do the same.

It's all about convenience

Medical providers and pharmacies, including mail-order pharmacies, will often give you the option to keep a credit card on file and authorize payments up to a certain amount. That was an option I didn't take advantage of until recently.

Before I made that change, though, I received a bill in the mail from my mail-order pharmacy for $0.37. Since I'm used to paying all of my bills electronically, I figured I'd log onto the pharmacy's site, get into my account, pay my tiny little bill, and be done with it.

Only things got complicated very quickly.

First, I forgot my password and had to reset it. Then the reset link didn't work. Once it did work, I encountered a problem logging into my account and got blocked out. I had to call up tech support to get my account unblocked, at which point I was able to go in and make my payment.

All told, I spent over 20 minutes paying a $0.37 bill. That was 20 minutes I couldn't spend working and earning money.

And that's why I've since made a point to keep a credit card on file with that pharmacy as well as my primary care doctor's office. That way, smaller bills can just be charged to my card automatically and I don't have to be bothered with actively paying them.

An option worth considering

The problem with keeping a credit card on file for medical bills is that you don't want your card charged with a large sum without you knowing it. Let's say you rack up a medical bill for $84 and don't realize that charge was processed during a given billing cycle. That could result in a situation where you're unable to pay your credit card bill in full.

However, there is a workaround. First of all, providers who allow you to keep a credit card on file will generally make a point to send you a text or email when a charge is being processed. But also, you can instead get into the habit of logging into your credit card account every week and checking your balance to see what charges you're looking at.

Another solution is to only authorize charges of up to a small amount. At my doctor's office, I set that limit at $25, which should generally be enough to cover whatever copay I'm looking at. If it's a larger sum, I want to know about it and see that bill anyway.

You could authorize your providers to charge your card up to a small amount that you're comfortable with. That way, you may be able to avoid a scenario where you're spending time making payments of less than a dollar.