How Does Health Care Crowdfunding work?
CrowdHealth is revolutionizing the way people pay for their healthcare bills. Instead of sending money to an insurance company, our members submit funds each month into a “Health Funding Account” that is theirs. The money in the Health Funding Account is used to fund health events of other members in the community.
Here is how it works:
When a Member has a health event that costs more than $500, CrowdHealth reaches out to the Crowd to crowdfund that bill.
For example, we recently helped a Member with a pregnancy event costing approximately $15,000. The Member paid the first $500 of the related bills. Then, we reached out to 200 Members to see if they would be interested in helping the Member pay for the rest of the bill. Of the 200, 198 said yes, and $14,500 was transferred from those 198 Health Funding Accounts to the Member’s Health Funding Account. The Member was then able to pay her doctor directly from that account.
What are the benefits of crowdfunding?
- Most of the time, CrowdHealth Members receive the money to pay for bills ahead of time. That means that Members are not expected to pay big bills up front and then wait for funding after the fact.
- Additionally, given that many big expenses (like the pregnancy mentioned above) have an approximate procedure date, Members can pay a practitioner up front before the procedure and get significantly better rates (50% discounts or more, in many cases) than the health insurance plans that often pay 60-90 days after the procedure. Doctors dig getting paid on time and in cash.
- With health care crowdfunding, you know exactly where your money is going. Health insurance plans put your money in a big risk pool and pay claims out of that pool. You have no real idea how your money is spent. But with CrowdHealth, you are giving to a someone specific, e.g. “A Member in Colorado who is having foot surgery” and needs your help. There is something cool about that (at least we think so), and it’s way more personal than the black hole of insurance spending.
- The money you put into your Health Funding Account is yours. If at any point you want to leave CrowdHealth, you can take the money in your account with you (minus an account closure fee).
Ok sooooo, why would anyone voluntarily crowdfund my bills?
Great question. CrowdHealth calculates a reputation score (we call it a Generosity Score) for each Member. When you or another Member asks for crowdfunding for a bill, that score is revealed along with the funding request. It’s much like a reputation score on eBay or Amazon. You are more likely to buy from a high-rated seller than one that is low-rated, right?
At CrowdHealth, if you get a request from a Member that has been generous (highly rated), then you are more likely to help crowdfund their health expenses. If you get a request from a Scrooge, then you probably are not super excited to give to their request. This keeps people from taking from the Crowd without giving back, and this reciprocity approach has been extremely effective at fueling the generous crowdfunding that makes CrowdHealth work.
For the math nerds out there, our Generosity Scores are calculated as Amount Given/Amount Requested. We reduce Amount Requested by any amounts requested by members with a 90 generosity score or lower. We don’t think our members should be penalized for saying “No, thanks” to the Scrooges in the community.
It’s different. We get it. But we think what we’re building is a revolutionary way to pay for health care that finally gives you freedom from health insurance, saves you a boatload of cash, and gives you a place in a Community that’s shaking things up in a good way.
Any time you have questions about how this works, we’d love to chat more. Email us your thoughts or inquiries at hey@joincrowdhealth.com.
