Reducing medical bankruptcy through crowdfunding: Evidence from giveforward

Research output: Contribution to conferencePaper

13 Scopus citations

Abstract

An estimated 62% of individual bankruptcy filings in the United States were a direct result of costs borne from medical treatment following illness or injury. We consider the potential of online crowdfunding to alleviate the issue, wherein patients reach out to their social network for monetary support to help cover medical bills. We examine the effect of medical crowdfunding using proprietary data from one of the largest medical crowdfunding platforms, GiveForward.com, combined with state records of bankruptcy filing. Controlling for a variety of socioeconomic indicators, we find evidence that fundraising helped prevent between 114 and 136 bankruptcies across the US, per quarter, representing 3.9 percent of all medical related bankruptcies. Further, we explore the relationship between crowdfunding and public health insurance, finding evidence of a substitution effect when health insurance coverage is high. We discuss the implications of our findings for healthcare policy and crowdfunding.

Original languageEnglish (US)
StatePublished - Jan 1 2014
Event35th International Conference on Information Systems: Building a Better World Through Information Systems, ICIS 2014 - Auckland, New Zealand
Duration: Dec 14 2014Dec 17 2014

Other

Other35th International Conference on Information Systems: Building a Better World Through Information Systems, ICIS 2014
CountryNew Zealand
CityAuckland
Period12/14/1412/17/14

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Keywords

  • Bankruptcy
  • Crowdfunding
  • Medical insurance
  • Policy
  • Public health

Cite this

Burtch, G., & Chan, J. (2014). Reducing medical bankruptcy through crowdfunding: Evidence from giveforward. Paper presented at 35th International Conference on Information Systems: Building a Better World Through Information Systems, ICIS 2014, Auckland, New Zealand.