Medical bill payment solution: Patient mortgages

The prices of specialized healthcare services continue to skyrocket and some policy experts have suggested a new payment alternative for patients: Mortgages.

A prominent Harvard oncologist and an economist at the Massachusetts Institute of Technology have suggested that nearly decade-long loans for patients may be a way to pay for some of the more expensive treatments such as drugs to cure Hepatitis C, Kaiser Health News reported.

Andrew Lo of MIT's Sloan School of Management, and David Weinstock, M.D., of the Harvard-affiliated Dana-Farber Cancer Institute, have suggested nine-year loans at 9 percent interest rates--about five interest points higher than current mortgage rates--may be a way to finance pricey specialty care, such as an $84,000 regimen of Sovaldi. The patient would not be obligated to repay the loan if the treatment fails.

"This is a private sector stopgap way to deal with something right now," Lo told Kaiser Health News.

Such a suggestion comes at a time when patients are already managing a considerable amount of medical debt. The Consumer Financial Bureau reported in 2014 that nearly 43 million Americans have some form of medical debt. And even among those patients with insurance, about 20 percent report issues paying their medical bills. Moreover, patients suffering from serious diseases such as cancer often have ongoing significant medical bills to pay for the rest of their lives.

The proposal has drawn its share of critics.

"Isn't this why we have health insurance?" Mark Rukavina, a Boston-based healthcare consultant who focuses on medical debt and related issues, told Kaiser Health News. "Insurance used to protect people from financial ruin for these unpredictable, costly occurrences. Now, with large deductibles, we've got coverage for preventive care but not for treatment."

To learn more:
- read the Kaiser Health News article