Credit card rewards for medical bills

[Jumpingbean]

I recently gave birth less than 2 weeks ago and I’m expecting the bill from the hospital to be around 3-5k. My HSA has about 5k in it but I thought it might be a good idea to get some credit card rewards since I can easily get to the 1k spending limit for some within 3 months. I have only used one credit card in my life so I don’t really know how this works. My credit score is great and I don’t have any worries about being declined or not being able to pay off the balance in full. Do I really just apply for the card and start using it? The Wells Fargo card looks like the best with $200 cash back on $1000 spent. Any other cards that aren’t on the “MMM recommends” page? Do I cancel the cards after a year? Why doesn’t everyone do this if it is really so easy?

Also, this means I can use my HSA too, I just have to fill a claim with the bills to get reimbursed?

[I'm a red panda]

I don't have an HSA, so I don't know how reimbursement works, but we got new credit cards to pay off the birth of my daughter and collect sign up rewards. We don't cancel the cards unless they have an annual fee.

Why doesn't everyone do this? Many people aren't responsible with credit, and have learned it is better for them to not take out new cards at all

[soccerluvof4]

If you can afford not to use your HSA up I would keep building that up as long as you can.  You can find better credit cards here- https://www.doctorofcredit.com/  if you want to get some cash back etc..

[Chrissy]

We've done this with both children.  It works!

Do I really just apply for the card and start using it?

Yes.

Do I cancel the cards after a year?

Only if you want to.  We have the Fidelity cash-back card, and we put our whole lives on it.

Why doesn’t everyone do this if it is really so easy?

Everyone does!

Also, this means I can use my HSA too, I just have to fill a claim with the bills to get reimbursed?

Yes.

This year, I paid off our $2,500 deductible from having our 2nd baby with our Fidelity card.  Got the cash back.  Submitted the expense to my employer, with whom I have a special deal, and they reimbursed me totally.  So, actually, we made a 2% profit from having the kiddo.  Husband calls this my "money laundering scheme".

[me1]

I did this too! It's how i got into regular churning. Wish I knew about it earlier for other medical expenses. I am more into travel rewards as 1. I love to travel and 2. you can actually get more value than just getting cash back.  My advice is do some research on which cards provide the best benefits for what you want to do. you may be able to use more than one card.

[Cezil]

I met my out of pocket max in June ($5,500) and wanted to put it on credit cards so we at least got some type of rewards.  No, I couldn't pay it off all at once (SO had met his OOP max in March, things got tighter than usual).  I put my bills all on 0% payment plans provided through the hospitals billing department.  Then I have those payment plans set up to deduct automatic payments each month from our credit card (the card gets paid off in full each month).  While we aren't getting sign-up bonuses (actually..we are, currently working on the Chase Sapphire Reserve requirement), we're still accumulating points.  It's working out for us.

Note: I have over $8K in my HSA.  I chose to not touch this and let it grow since the payment plans are 0% interest.

[MrsDinero]

I did this after I gave birth to my last child.  I received the Chase Sapphire Rewards when it was 100k points and used it to pay for the medical bills.  It was great!  We combined those points with some frequent flyer points and took a total of 6 people to Hawaii for 14 days.

[Road2Freedom]

Since I have two kids under 2, flying / traveling sounds like pure torture for the next few years. This is why cash back seems like my best option. But, the best I see on several cards is $150 back for $500 spent. Still a good deal but I think I will limit myself to 3 new cards for a total of $450 dollars cash back sign up rewards. Where are these deals that you can get a whole $3-5k medical bill covered with rewards?, or is that if I just go the airline miles route?

They're out there.  I received an offer for the Capital One Savor in the mail yesterday.  Typically just rip them up but noticed this one was offering $500 cash back if you spend $3000 in 3 months.  I applied for it online and it required you enter the code on the letter.  Annual fee was waived 1st year so I'll cancel it in 6-9 months.  I also have about $1600 in medical bills, will pay off our car insurance, and likely hit the spend on other monthly bills in the first 30 days.

My main card is the USAA Limitless that's 2.5% cash back across the board.

[Radagast]

Try to get at least $200 out of each card. A lot more than that if you will continue chasing sign up bonuses over the rest of the year. In a few minutes looking I see:
> Bank of America Cash Rewards credit card that is $200 cash for $500 spend,
> MLB version of ^ the above, also $200 for $500
> American Express Blue Cash Preferred® Card, $200 for $1,000
> Wells Fargo Cash Wise Visa® Card, $200 for $1,000

If you plan to do this going forward you will find yourself trying to get the greatest bonus per card application, rather than just looking at per dollar spent. That is why most of the cards you see recommended are more on the order of "$500 for $5,000 spent" or something. The best pure cash back strategy I have thought of involves racking up a huge pile of American Express Membership Rewards Points, and then transferring them to Schwab at 1.25 cents each. But to get the most out of it will involve three or more cards with $12,000 or more combined spend, pulling in some side benefits, likely a year or two, and also some luck in being offered high bonuses.

[Lanthiriel]

I'm doing this too. Husband just spent an overnight in the hospital and had every heart test they offer except a biopsy (he's fine). I'm turning that $4k maximum out of pocket charge into 3 nights in Hawaii using the Hilton card. As soon as we knew he was OK, my first thought was "how can I churn this?"

[hops]

This year, I paid off our $2,500 deductible from having our 2nd baby with our Fidelity card.  Got the cash back.  Submitted the expense to my employer, with whom I have a special deal, and they reimbursed me totally.  So, actually, we made a 2% profit from having the kiddo.  Husband calls this my "money laundering scheme".

Yep, we meet our deductibles every year and always put it on our Fidelity card. A few times a year they run bonus points promotions, so it's always nice if that coincides with a big medical bill. Then we purchase commission-free ETFs. I like to joke that our poor health pays dividends.

[Jumpingbean]

Thanks all, I’ve decided to test the waters and applied for the BoA $200 for $500 spent and the Capital one savor $500 for $3000 spent. If this all works out I will have to keep this credit card churning thing up in the long run.

[okisok]

I do it! I just got the Chase Quicksilver card with a $150/$500. I paid my six month's car insurance bill ($541) that was due in August, then used the reward to pay my annual renter's insurance ($150) that came due in September. A free year's worth of insurance! Plus, it's a 1.5% cash back card, so I made $10.37, bringing my car insurance bill to $530.63. I *love* that I made money for paying for something I'd budgeted to pay for anyway!
I'll keep using this card for usual purchases (outside of my Chase Freedom 5% quarterly rewards) until something better comes along.

[Road2Freedom]

Fyi regarding the Capital One Savor.  I hit the $3k spend last week and they deposited the $500 rewards credit into my account.  I applied it to my balance today and should reflect in my account within 2-3 business days.  Will pay off the remaining balance after that.

Pretty easy $500.

[Linea_Norway]

From what I read in another thread: ask the hospital if they are willing to give you a reduction of the bill when you pay the whole sum immediately.

[I'm a red panda]

From what I read in another thread: ask the hospital if they are willing to give you a reduction of the bill when you pay the whole sum immediately.

I'm so jealous of people this works for. I've never seen any medical provider/hospital do this.

[mountain mustache]

I do this for every large expense I have. This year it was meeting my $7800 out of pocket max for health insurance. I signed up for two different cards and got cash back bonuses, while using 0% financing through the hospital. Any time I have a major expense, I think "what card can I get $200-$300 off to pay for this?"

[Cranky]

From what I read in another thread: ask the hospital if they are willing to give you a reduction of the bill when you pay the whole sum immediately.

I'm so jealous of people this works for. I've never seen any medical provider/hospital do this.

So, the hospital I'm using offers a 20% discount if I pay up front. We're trying to decide how that will work - does it just mean that soe other part of this expensive project will get our money until we actually have covered our whole deductible/co-pay OOP? I suspect that it's just the hospital's way of trying to jump to the head of the line.

[kpd905]

If you have a $3-5k bill, then I would just grab the Chase Sapphire Preferred rather than trying to put the charge on a couple $200 cashback cards.  The Sapphire Preferred will give you 55,000 points after you spend $4,000 and add an authorized user in 3 months.  You'll be able to cash out for ~$590 after hitting the spend, otherwise use it for ~$740 toward travel expenses in the Chase portal.

The reason I'd get this card first is due to the 5/24 rule.  After that you can grab a few of those $200 cashback cards, since you shouldn't need a large expense to hit the required spend on most of those.