You get a mortgage to pay for a house. Why not get a loan to pay installments for expensive healthcare?
An economist from MIT and a Harvard oncologist have written a proposal to help get expensive-yet-effective drug treatments into the hands of patients with the aid of health care loans. Insurance used to protect people financially from costly medical needs. With increasingly large deductibles, preventative care is covered but not treatments. Drug loans would enable patients to purchase high-priced items requiring an up-front payment.
The proposal states that loans will be financed by an investor pool who will buy bonds and equities issued by a loan organization. The loans would be aimed at helping patients afford “transformative” therapies that would cure lethal conditions like cancer or hepatitis C. They would not pay for maintenance drugs for chronic illnesses, since those are covered by insurance.
Hepatitis C drugs Sovaldi and Harvoni can cure the liver-destroying disease in a few months. The treatment costs $84,000 and has limited insurer’s coverage. Someone who wants the treatment could take out a healthcare loan for nine years at 9% interest. If a therapy does not work or the patient dies, they don’t have to repay the loan. This penalizes the patient that has a good outcome.
Increased cost is a real concern, as Obamacare has made it easier for people to obtain expensive treatments, yet also has driven prices up.
The authors of the loan proposal will hold a conference this winter to bring together drug manufacturers, insurance companies, patient advocates, and financial engineers to discuss how to make expensive drug therapies more affordable. They will also discuss health care loans.
Andrews, Michelle. “Mortgages For Expensive Health Care? Some Experts Think It Can Work.” News. Kaiser Health News, 29 Mar 2016. Web. 29 Mar 2016.