The $300 Billion Blind Spot: Consumer Healthcare Financing Is the Next Credit Story

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Last month, a friend called me, almost in a panic. Her dermatologist wanted $2,800 for a procedure, and her insurance would only cover part of it. She had just 30 days to make a decision. Her credit card had a 24% interest rate, and getting a personal loan would require a hard credit check and a week's wait, time which she didn’t have. In the end, she used a point-of-sale medical lender, which let her split the cost into six interest-free payments.

This exact situation is playing out across the country right now, and I think it points to a credit theme worth your attention if you have any exposure to consumer ABS, specialty finance, or fintech lending platforms.

Start with the scale of the problem. Out-of-pocket healthcare spending hit $556.6 billion in 2024, up 5.9% from the prior year. CMS actuaries project national health expenditures will climb toward $8.6 trillion by 2033, growing at an average annual rate that continues to outpace GDP. This is not a temporary post-pandemic bump. Rather, it is a structural trend, and structural trends create structural financing needs.

Higher Costs for Individuals a Driver

Two policy shifts are compounding the pressure this year. Mercer's 2025 National Survey of Employer-Sponsored Health Plans found that 59% of employers plan to raise deductibles or other cost-sharing provisions for 2026, up from 44% in 2024.

At the same time, the ACA's enhanced premium tax credits expired at the end of 2025, and KFF estimates that subsidized marketplace enrollees will see net premium payments rise 114% on average, from roughly $888 to $1,904 a year. Higher deductibles and higher premiums both push more of the healthcare bill directly onto household balance sheets, at the exact moment those bills are getting bigger.

This is where things get interesting with credit. Credit cards and personal loans were not designed for expenses like these. Credit cards are fine for regular, everyday purchases, but they are not a good choice for a $3,000 emergency dental bill if that card has an interest rate over 22% and starts adding interest as soon as the patient leaves the office. Personal loans can offer better rates, but they take time to process, and medical bills usually need to be paid right away.

Patients need financing that is approved on the spot and fits the cost and timing of their specific procedure.

This is the gap that a newer class of lenders — including CareCredit, Affirm, Sunbit, and Cherry — has been built to fill. The growth of buy now, pay later healthcare financing over the past two years reflects how quickly demand has caught up with supply.