Three researchers from MIT and Harvard Medical School have put their heads together to produce and propose a detailed system for offering mortgage-like healthcare loans to hard-hit patients.
Writing in Science Translational Medicine, MIT’s Vahid Montazerhodjat, PhD, and co-authors build their business case as a response to the financial crisis many non-affluent patients face when they can’t even begin to afford available treatments for serious diseases and conditions.
That’s increasingly the case, as the skyrocketing costs of life-saving drugs, in particular, made a lot of publishers’ lists of the top healthcare stories of 2015. It seems reasonable to expect December 2016 to bring more of the same.
The profs’ paper fleshes out their proposed system and calls for a convening of various healthcare-finance stakeholders—pharma execs, insurers, patient advocates, regulators, financial players and investors—to fine-tune the system and, eventually, implement a plan.
The authors express confidence in the feasibility of their proposal.
“By estimating the post-treatment mortality rates of the patients and using statistical models to gauge the default characteristics of these loans,” they write, “we demonstrate viability under current practical conditions.”
The healthcare loans the authors propose would make use of securitization, the financial sector’s practice of pooling debts and selling the related cash flows to third-party investors, in order to finance a large, diversified pool of borrowers.
Securitization “brings new participants (for example, pension funds, mutual funds and life insurance companies) into the financing pool,” they explain, “and helps transform a set of disjointed and sometimes competing interests into a more cooperative system focused on improving care.”
The authors announce that the MIT Laboratory for Financial Engineering and the Dana-Farber Cancer Institute will jointly host a conference later this year bringing together the aforementioned stakeholders.
“Considering the extremely large burden of certain diseases, such as hepatitis C virus, for which cures already exist, and the many transformative therapies on the horizon, developing more efficient financing methods is now a matter of life and death,” write Montazerhodjat et al. “Taking action is no longer a choice but has become a necessity.”
Science Translational Medicine has posted the paper in its entirety.
Dave P. has worked in journalism, marketing and public relations for more than 30 years, frequently concentrating on hospitals, healthcare technology and Catholic communications. He has also specialized in fundraising communications, ghostwriting for CEOs of local, national and global charities, nonprofits and foundations.