On the surface, medical crowdfunding and health sharing ministries seem similar. Both involve people pooling money to help pay for medical bills, so it makes sense that you may wonder “crowdfunding and health sharing: what’s the difference?” However, they do work differently. And these differences are large enough that one clearly works better for healthcare.
Crowdfunding
In crowdfunding, one person or organization creates a campaign to raise money for a specific cause. Crowdfunding for medical needs happens frequently, but crowdfunding can be done for a variety of reasons. For example, sites like Kickstarter and IndieGoGo help small businesses launch new products. GoFundMe is more often used by individuals to request donations for catastrophic needs (such as major medical costs or recovery after natural disasters). Crowdfunding has become more and more popular and can be a great way to raise money, but it has some downsides.
- Crowdfunding campaigns usually require a very active social media presence to succeed. People can’t donate unless they know about the need. Also, people are more likely to donate to campaigns with a compelling story. A crowdfunding campaign manager should have plenty of time to manage social media as well as some communication skills. A study published in Social Science & Medicine revealed that 90% of crowdfunding campaigns don’t meet their goals. Other articles made additional connections between successful campaigns and good marketing.
- Depending on the platform, campaigns that don’t meet their funding goals may have more money taken by the fundraiser host. Companies like GoFundMe frequently claim a portion of donations (usually by adding a mandatory “tip” to the donation amount), but in some cases it gets worse. An unsuccessful campaign may need to give the fundraiser host more money than the amount paid if things had gone well.
Note: We haven’t found an explanation for this. Moreover, it seems to happen randomly; not all companies do this.
- Medical crowdfunding places no restrictions on funded treatments. For instance, they can give people money for possibly harmful experimental “treatments.” An article published by HealthAffairs explained that alternative treatments drastically increase death rates for cancer patients when compared to conventional care. It also pointed out that popular “stem cell treatments” for brain injuries risk causing strokes, infections, or death. For these reasons, crowdfunding usually works best for business ventures or personal goals without the complications of healthcare. Also, crucial healthcare usually has a short timeline—when care isn’t funded, people can die. Startups and passion projects can better afford to wait for their campaign to reach a large audience.
HealthSharing
HealthShares work similarly to traditional insurance—though they are not regulated the same way. Members pay a monthly fee and a certain dollar amount toward their medical costs (either per year or per medical need), and they submit their medical bills to their HealthShare. Once the member meets their financial obligation, the HealthShare takes care of the rest.
- There is no need to try to market a cause to a mass audience. Members are responsible for providing the billing information to their HealthShare representatives, and checking that the bills meet eligibility requirements, but they don’t have to persuade others to donate to them. All HealthShare members expect the money they pay for membership to help other members with their medical bills. In other words, no need to try to convince other members to support you. They’re already on-board!
- There are no additional fees for bill sharing (unlike how crowdfunding sites sometimes take larger cuts from failed campaigns). HealthShares take administration costs out of a member’s monthly membership cost. As nonprofits, most HealthShares only put a small percetage of costs towards administration. Check to see if your HealthShare shares their financial stats online.
- All recognized HealthShares require that members receive approved services from licensed providers in licensed facilities. Even HealthShares without a provider network will not share bills for risky, unapproved medical services. One of the best things about HealthShares is their focus on encouraging healthy lifestyles and communities, and it’s reassuring that they want to protect their members from damaging medical services.
Summing up
Crowdfunding can work well for some situations, but running a successful fundraiser requires work, skill, and some luck. It isn’t a great solution for most healthcare problems for these reasons. Most people are better off using more healthcare-oriented means like insurance or medical cost sharing. “Crowdfunding and Health Sharing: What’s the Difference?” Might be more than you thought!
