Should you pay off medical debts with a credit card?

Americans are carrying a staggering $220 billion in medical debt, according to the American Hospital Association, with approximately 3 million people owing over $10,000 in health care expenses.

If you have substantial medical bills, putting them on a credit card may seem like an easy solution, but it can easily cost you more in the long run.

"It's definitely something people should avoid unless they're able to pay off the full amount of the charge right away," Lisa Zamosky, author of "Health Care, Insurance and You: The Savvy Consumer's Guide," told CNBC Select. "You want to avoid adding to the pain of medical debt by racking up interest while you work to pay off your credit card."

Here are five options to consider before putting medical expenses on your card.

Up to 80% of medical bills contain some sort of error, so read over any invoice you get before paying. If you're the patient, have a trusted family member or friend be a second set of eyes for any red flags.

"Always make sure your bill is itemized and accurate — particularly after a hospital stay," Zamosky said. "Speak to the billing department if something seems off. If you're insured, request your health plan's assistance."

The process of disputing a medical bill may take a while, but the time spent can save you money.

Medical providers typically have more flexibility when it comes to bills than other creditors.

If you can't afford to pay the full balance, explain your financial situation and see if they offer a sliding scale or are willing to forgive part of your balance in return for an immediate payment.

"If that's not an option, at least ask for a discount on the charges," Zamosky said. "The Medicare rate, for example, is a good place to start."

If they can't reduce the charges, try negotiating an interest-free payment plan.

"Many hospitals and other health-care providers will allow for that," Zamosky added. "And, again, that's much preferred to incurring credit card interest."

Many hospitals offer financial aid, though they may not advertise it, according to financial educator Thomas Nitzsche of Money Management International, a nonprofit debt assistance organization.

In some states, they're required by law to provide free or reduced services, depending on the patient's income, household size, age, insurance status and if they have a disability.

"Even if you think you won't qualify for aid, it's a good idea to apply," Nitszche said. "You may not receive a balance reduction, but simply the act of applying can substantially extend your timeframe for repaying the debt. Usually at 0% interest."

Nitzsche has had clients get a portion of their bill forgiven and the remaining balance placed on an interest-free monthly payment plan.

Beyond the hospital itself, there may be local, state or national charities that offer financial assistance. The Patient Advocate Foundation has a list of outlets that provide small grants to patients who meet financial and medical criteria. 

If you're being charged interest on your medical debt, a personal loan typically offers lower rates than credit cards.

Upgrade approves loans for as little as $1,000 or as much as $50,000, with loan terms up to 84 months.

If you don't have great credit, the San Francisco-based fintech approves borrowers with FICO Scores as low as 620.

If you have thousands in medical bills, a debt relief (or debt settlement) company may be able to negotiate with your provider or collections agency to lower the balance.

There are drawbacks: Your credit score will take a hit and, if the company successfully negotiates your debt, you'll be charged as much as 25% of your enrolled debt for its efforts.

It may be worth it, though, depending on how much you owe and how much is forgiven.

Freedom Debt Relief is one of our top picks for debt settlement and only requires $7,500 in debt, a smaller amount than many competitors.

Nitzsche and Zamosky agree that a credit card should only be considered only if you've exhausted all other avenues and you can see a realistic path toward repaying the debt after it's charged.

You should also compare interest rates and penalties: Switching from a low- or no-interest debt to a high-interest debt like a credit card can make a bad problem worse.

Medical credit cards are specifically designed to cover health care expenses within a network of approved providers. They have more flexible credit requirements than traditional credit cards and often come with a promotional deferred interest period.

One of the most popular options, the CareCredit® card from Synchrony Financial has no annual fee and is accepted at more than 270,000 locations.

Keep in mind that medical credit cards can only be used for qualifying expenses. And if you haven't paid off the balance when the deferment period ends, interest can be charged retroactively from the original date.

An alternative is signing up for a card with an introductory 0% APR, which will give you more breathing space when you're not being charged interest.

The Chase Freedom Unlimited® (see rates and fees) is a simple cash-back card with an introductory 0% APR for the first 15 months on new purchases and balance transfers (then 18.24% - 27.74% variable APR). There's an intro balance-transfer fee of $5 or 3% of the amount of each transfer, whichever is greater in the first 60 days. After that: the ongoing fee will be either $5 or 5% of the amount of each transfer, whichever is greater.

If you've charged your medical debt and are having trouble with payments, consider a 0% balance transfer offer, which can keep more interest from accruing for more than a year.

The Citi Simplicity^® Card offers 0% intro APR on balance transfers in the 21 months following opening your card and 0% intro APR on purchases made within the first 12 months (then 17.49% - 28.24% variable APR). Balance transfers must be completed within 4 months of account opening. There is an intro balance transfer fee of 3% of each transfer (minimum $5) completed within the first 4 months of account opening. After that, your fee will be 5% of each transfer (minimum $5).

Just ignoring your medical bills is a big mistake: Though it's less harmful than other debts, outstanding medical debt still hurts your credit score.

And while the debt is removed from your credit report after seven years, you still owe the money. Providers or collections agencies can sue you for non-payment and garnish your wages or even place a lien on your home.

"Not paying the bill should only be a course of action if the consumer has exhausted other options or adjustments and can truly only afford their basic housing and living expenses," Nitzsche said.

At CNBC Select, our mission is to provide our readers with high-quality service journalism and comprehensive consumer advice so they can make informed decisions with their money. Every boat insurance review is based on rigorous reporting by our team of expert writers and editors with extensive knowledge of insurance products. While CNBC Select earns a commission from affiliate partners on many offers and links, we create all our content without input from our commercial team or any outside third parties, and we pride ourselves on our journalistic standards and ethics.

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