Can Crowdfunding Provide Healthcare for the World's Poorest?
BY Federico Guerrini | Monday, April 14 2014
In 2012, Bageshwori, a 12-year-old girl from Nepal was suffering from rheumatic heart disease, a condition that prevents blood from essentially moving through the heart, causing constant fatigue, shortness of breath, congestive heart failure, and even death. She needed heart surgery to replace her mitral valve. The surgery wouldn't be difficult -- rheumatic heart disease is usually easy to cure –- but her family, who lives in a region where the average per capita income is $1 per day, simply couldn't afford the $1,125 treatment.
Watsi was founded by Chase Adam, a former Peace Corps volunteer. In 2010, he was traveling on a bus in the Talamanca Indigenous territory of Costa Rica when a woman boarded the bus and asked the passengers for donations to pay for her son’s medical treatment. She showed a picture of a young boy with an incision across the span of his stomach. “In that moment I had what can only be described as an epiphany," Adam explains on the Watsi website. "If I could somehow connect this woman with my friends and family back home, she would have the money to pay for her son's medical treatment within the day.”
This experience led to the birth of Watsi, named after the town Chase was traveling through at the time.
How it Works
“We're a bit of a Kickstarter for healthcare," Watsi's marketing manager Grace Garey tells techPresident. "With the difference that there's no concept like on Kickstarter or on some of these other websites of a project expiring. If a project doesn't reach its goal after a certain number of days or a certain amount of time, it's not pulled down until it's fully funded.”
A “project” in this case corresponds to a patient whose story is uploaded online, together with a picture, to explain why a patient needs treatment and how much it will cost. The actual procedure is performed by Watsi's partners, 15 well respected medical organizations operating in some of the world's poorest regions -- from Africa to Guatemala, Cambodia or the Philippines. For immediate need or emergency cases, Watsi's providers conduct the operation first for the selected patients and receive payment once the funding comes in.
Treatments generally have a high likelihood of success, must be under $1,500 and do not involve multiple operations or long-term care. If a patient passes away before receiving a treatment funded by Watsi, donors will either be refunded or given the option to reallocate their donation. If a patient passes away after receiving a treatment, supporters will receive an explanation as to what happened.
Bageshwori was the first patient to be funded by Watsi. “After less than two years," says Garey, "Close to 1,500 individual patients have been funded on the platform and almost $3 million has been raised for patients. Half of the donations come from regular small donors and then the other from corporate partnerships. Big companies will do fundraisers where they raise money for Watsi patients and we collect that money and then distribute it.”
All money collected from donors go towards patients' treatments; Watsi does not apply a fee for their services and sustains itself through other means. “Right now we're founded mainly in two ways. One which we call the “philantrophic round” -- a bunch of people in the technology community that chose to support us." The startup raised $1.2 million from Tencent, Paul Graham, Ron Conway, Vinod Khosla and other investors. "We're also experimenting with other things," says Garey, "asking givers to give something extra to support our costs, when they make the donation, and licensing our technology to other companies.”
Kangu is another nonprofit that is also crowdsourcing healthcare and it was founded in 2012 by former Kiva staff member Casey Santiago, in an effort to provide safe births to mothers who live in regions of the world with the highest maternal mortality rates, including areas of Uganda, Nepal, Burundi and India. “I'm a mom of two." Santiago tells techPresident. "After having my kids, I could not shake the thought that if I had been born in another country, Uganda for example, I would have had a 1 in 46 chance of not surviving a pregnancy. This, to me, is totally unacceptable.”
In Uganda, only 47% of women receive prenatal care and only 42% of births are attended by skilled health personnel. Pregnant women and their newborn babies are also particularly susceptible to complications related to malaria, which is endemic in the country.
That's why people like Grace, a 27-year-old widow whose husband was killed in a motor accident when she was three months pregnant or Betty, a 20-year-old in her first pregnancy, rely on the services provided by Kangu's medical partners, which is in this case the Teso Safe Motherhood Project.
The way Kangu operates is very similar to Watsi. A picture of the pregnant woman is posted online, together with a short introduction. Donors contribute online by giving $10 or more, and will receive updates on the mother and baby they have supported, as well as have the opportunity to connect with others who have donated to the same patient.
Roughly $200 per woman covers prenatal care, delivery with a trained professional, emergency obstetric care if needed, postnatal care, medications (like for malaria, HIV/AIDS, and infections), and newborn immunizations.The number of patients funded at any given time through the platform is variable, as there is an ebb and flow to the births based on agriculture and holidays. As a result, there are some months that are significantly busier than others. “Taking as an example our medical partner in northern Uganda, they average about 100 deliveries per month, and in 2013 had 1,136 deliveries with no deaths,” says Santiago.
But what if despite the care, a mother does dies -- what happens? Santiago says, “To date, all the mothers funded on Kangu have survived. We have not yet experienced a maternal death. If we lose a patient in the future, we are committed to openly communicating to her funders what happened and what services she received. We believe that it is in no ones interest to hide the real danger that exists in being pregnant in a developing country.”
And what about privacy? Are mothers happy to have their story published online, for everyone to see, or do they feel obligated to do so to receive funding? “All patients are aware of and consent to their photo and story being on the Kangu website. To further protect patient privacy, we only use first names.”
The same is true for Watsi. Every patient signs a waiver to allow the publication of his or her online profile; if he or she doesn’t wish to be featured on the website, the treatment could still be funded through the so-called Universal Fund.
The idea of having Kickstarters for healthcare, however well intended, also raises a number of other ethical issues.
Fred Trotter, crowdfunding expert and author of Hacking Healthcare (a book about the difficult relationship between IT and healthcare, in the USA and in general), tells techPresident, “Online crowdfunding for healthcare -- it's a wonderful idea that demands careful execution. The technical details matter tremendously here. There is a reason that Kickstarter specifically excluded this type of crowdfunding from the site. There are really complex implications for doing medical crowdfunding that they did not want to take on.”
One issue is ensuring against fraudulent cases and ensuring that the treatment the patient is seeking is actually the one he or she needs. Trotter explains, “For instance, let's say a patient decides to crowdfund Chelation therapy to remove 'toxins' that are causing their migraines. That is a dangerous misuse of Chelation therapy, which does help in cases of severe heavy metal poisoning. How does the platform respond? If it does the crowdfund, it is endorsing quackery, if it does not, then it is now in the business of evaluating treatments.”
Trotter further explains, “What happens when the first patient tries to crowdfund a trip to Tahiti for aromatherapy and 'touch therapy' to heal their 'stress'? That's basically just a vacation, and I could definitely use that kind of 'therapy' myself. Or, how do you handle malingering? What happens when the first healthy person makes the decision to crowdfund for cancer treatment when they do not have cancer? Current crowdfunding platforms basically take a 'buyer beware approach' to fraud detection and other issues like this. Its not clear that this works for a healthcare crowdfunding platform.”
The most glaring one is the idea of allowing the crowd to decide who receives treatment or who does not, or in some cases, who dies and who lives.
For instance, how does an organization like Watsi or Kangu prevent the crowd from playing favorites -- a patient with a particularly well presented profile -- or from discriminating based on a variety of factors like age, race, or gender?
“That just doesn't happen on Watsi at all because we believe basically that it shouldn't be a popularity contest and donors shouldn't be making medical decisions," says Garey. "We have many donors who email us and tell us, 'Oh, well, I donated to the motorcycle driver in his 60s because I was afraid that no one else would want to donate to him -- they would want to donate to the really cute kids instead.'”
Another issue is the larger scale impact of such projects on the healthcare ecosystem within a country. Komal Garewal, an independent crowdfunding consultant and a blogger for HealthIT Consultant who works for organizations like Healthfundr, tells techPresident, “Crowdfunding is a wonderful tool when raising funds for an immediate need, like disaster relief, but crowdfunding projects that take the place of NGOs, or even funding short term projects led by NGOs, always pose the threat of disrupting a system. The issue with many of these 'do-good' projects is that they often disrupt socioeconomic and cultural norms, after which populations end up in a place that may be worse than where they started.” According to this school of thought the problem is that while helping in the short term, in the long run these projects could weaken rather than empower those societies that receive such aid.
“Projects like these often disrupt local markets by not only introducing competition," says Garey. "But by also introducing a product standard that may not be locally achievable or sustainable. A widely cited example is the TOMS business model of donating a free pair of shoes to an "impoverished population" for each pair bought. Another is the effect of foreign aid after the Haitian earthquake on local farmers." The influx of foreign food aid meant that many Haitians could get rice for free. As a result, the price of rice in Haiti plummeted, and farmer's gains collapsed.
Also, a possible downside of these humanitarian efforts is to undermine the creation of a more efficient and comprehensive healthcare system in the country they operate; as governments, for lack of resources or of will, could be more than happy to outsource the care of their citizens.
“That's something we really think about," says Garewal. "One way to avoid this is that we only work with partner hospitals and organizations that have included some concept of public private partnership into their doings. Many of our hospitals are partially funded by the government. Another way to look at it, is that simply by virtue of funding an individual patient at a hospital, you're really doing a lot more than that. You're sustaining the core service and the core product that the hospital is providing: the surgeon's time, the supplies needed, the basic infrastructure. And you're also diverting the funding away that these hospitals and these governments are using to try and cover the cost of people who can't pay, which they're just hemorrhaging money trying to do this right now.”
Santiago says that achieving universal healthcare, however, requires a number of variables: “Universal health coverage can only be achieved within the context of a mixed healthcare system, made up of various service delivery and financing models. Crowdfunding is an additional source of funding that helps private providers recover their costs, enhance service provision and expand their reach.”
Federico Guerrini is an Italian journalist. He covers technology for a variety of publications including ZDnet, La Stampa, Wired.it, l'Espresso, and il Corriere della Sera, among others. He blogs at www.federicoguerrini.com and tweets as @fede_guerrini
Personal Democracy Media is grateful to the Omidyar Network and the UN Foundation for their generous support of techPresident's WeGov section.