By Caroline Mayer
Kaiser Health News, July 2, 2013
Even with Stage IV lung cancer, there are moments when 32-year-old Chip Kennett feels blessed. Over the course of two weeks in April, those moments were many, as 325 friends and family members contributed $56,800 over the Internet to help defray his out-of-pocket medical costs.
The Kennett family of Alexandria is one of thousands turning to the Internet to raise money for medical bills. The sites that host these campaigns operate much like online business fundraising sites such as Kickstarter. It takes only a few keystrokes for a family to set up a Web page, where they tell their story and state a fundraising goal; later, they can spread the word on social media sites such as Facebook. Donations can be made with credit cards or via PayPal.
The contributions, which can be given by name or anonymously, typically range from the very small (as little as $5) to the extremely generous ($1,000 and up). In the Kennetts’ case, donations ranged from $10 to $2,000. Most sites are for-profit and charge a fee, between 3 and 12 percent of the money donated, to cover the processing costs and the expenses of running the Web site.
The Kennetts acknowledge they are lucky to have good health insurance. (Sheila has a federal employee policy through her job at the Senate.) Even so, the Kennetts have paid thousands of dollars in out-of-pocket expenses, including the insurance plan’s co-pay requirements and its $5,000 annual deductible ($7,000 for out-of-network doctors) for both 2012 and 2013.
Medical fundraising sites are growing in number and profitability. In the first 12 months after it launched in 2008, GiveForward raised $225,000 for 359 campaigns; this year, it raised more than $20 million for more than 15,000. Company officials said GiveForward had more than $1.4 million in revenue in 2012 and has raised more than $47 million for families since it began.
When it launched, GiveForward also raised money for other causes — “scholarships, art projects, whatever,” says co-founder Ethan Austin. But the “hugbacks” — calls or messages from users — from medical fundraisers were so appreciative, “we decided, ‘Why do anything else?'”
Austin says he is not surprised at the rapid growth of crowd-funding for medical costs, citing a 2011 National Bureau of Economic Research study that found that half of American adults say they would not be able to come up with $2,000 in the event of a medical emergency. This, taken along with another recent study showing that the average cancer patient incurs as much as $8,500 a year in expenses not covered by insurance, further explains why so many ailing Americans are seeking outside help to pay their expenses, according to Austin.
http://www.kaiserhealthnews.org/Stories/2013/July/02/online-fundraising-to-help-pay-medical-bills-takes-hold.aspx
Comment:
By Don McCanne, M.D.
Crowdfunding: the collective effort of individuals who network and pool their money, usually via the Internet, to support efforts initiated by other people or organizations (Wikipedia).
What a nice gesture – friends, acquaintances and caring strangers joining together to pay medical expenses not covered by a federal employee health policy available through the United States Senate (FEHBP), one of the highest quality private insurance plans available in the United States.
What? Cost sharing has become so prevalent – even amongst the best of our health plans – that people with significant health care needs insured by these plans have to turn to charity to pay their bills? Not even cake sales will do. They need real money. (Isn’t this what insurance is supposed to prevent?)
And who moves in? Entrepreneurs who set up for-profit organizations that provide administrative services for this crowdfunding. Just what we need in a health care system already tremendously overburdened with administrative waste – more administrators who profit from our highly dysfunctional, fragmented health care financing system.
PwC reports that next year 44 percent of employers are considering high-deductible plans as the only option for their employees. The benchmark plans in the Marketplaces (exchanges) are high-deductible plans. The new national standard in health care coverage will leave far too many individuals exposed to financial hardship in spite of having a health care plan.
The logical solution would be to reverse this trend and provide coverage that protects individuals from medical debt. But that’s not the American way. We bring in more administrators and pay them richly, further adding to our almost intolerable national health expenditures.
Hey! Is anybody reading these messages? Single payer. Single payer! SINGLE PAYER!