Many of the problems related to the patient portion of healthcare involve inaccurate or incomplete knowledge and assumptions.  Some of these shortcomings are obvious.  For example, many families who qualify for free government health insurance have not signed up for it.  Other areas are more complicated.  Young and healthy individuals may assume that their health will remain constant for another year and therefore don’t get health insurance.  Having a deeper understanding of what their real chances are of having a problem and what the options available to them for low cost catastrophic insurance may lead them to a different decision.

There are many ways of providing financial education around issues of healthcare.  Providers could spearhead efforts in their community and through their offices.  Providers already provide healthcare related information through office pamphlets and community outreach.  

Many non-profits and government agencies around the country currently offer financial education programs targeted at helping consumers with budgeting, handling debt, and saving for a home.  These financial education programs could supplement their current offerings with more information about the risks and costs associated with medical events, and what can be done to manage them. 

The Robin Hood Foundation offers financial “triage” and education for low-income people in storefronts and community centers.  These One Stops offer advice and counseling and steer people to government and philanthropic benefits, like Medicaid or emergency rent payments, they may be qualified to receive.

Doctors’ offices and hospital waiting rooms are already filled with pamphlets about diseases and how to treat them.  Many of these are paid for by the companies that sell the treatments.  Others are paid for by government or non-profit agencies (safe sex brochures, for example.)  They tend to offer a small amount of targeted information with suggestions about how to learn more.

The City of San Francisco has launched a program to bring banking to low income individuals.  A component of this program is continuing financial education held in community centers and participating banks.  These education programs tend to focus on issues such as budgeting, savings, home buying, and debt.  Similar programs are conducted around the country primarily by nonprofit social service agencies. 

Covering Kids & Families is a national initiative of the Robert Wood Johnson Foundation.  Its goals is the reduce the number of eligible but uninsured children and adults through enrollment in Medicaid or the State Children's Health Insurance Programs  It is the largest effort of its kind and the foundation has invested nearly $150 million in it

The Covering Kids and Covering Kids & Families initiative has benefited from the work of coalitions in 50 states and the District of Columbia with more than 5,500 member organizations. This effort includes  public officials, health professionals, educators, businesses, social service agencies, faith-based organizations; and others all working to ensure that eligible children and adults are insured through Medicaid or SCHIP. 

The initiative has identified three strategies that have proven to be effective in terms of enrolling eligible, uninsured children and adults is programs to which they are entitled.  They include the simplification of eligibility policies and practices, coordination of eligibility policies and procedures across different coverage programs, and outreach to eligible, uninsured children and adults, often through community-based organizations. 

This level of concentrated effort, including significant funding for groups working at the local level helped to reduce the number of uninsured children from 11 million in 1997 to approximately 8 million in 2005.

Business model:  Businesses typically use advertising as a form of consumer education.  Any new program we create will require a certain amount of consumer education.  Existing programs, such as Medicaid, would be better utilized by more effective consumer financial education.  Furthermore, the deeper understanding of the real risks and benefits of health insurance may lead more people into the system. 

Assumptions:

1. A lack of information is causing bad decisions. 
2. Consumers have the time, energy, willingness, and capacity to integrate this new information into their current decision-making practices.  It is possible, however, that many of the people most burdened with medical expenses are already burdened with trying to survive on a low income and may not have the educational background to fully comprehend the options before them. 
3. Marketing is time consuming and expensive.  This component assumes that any program will have the necessary resources to deliver a message to the target communities in a meaningful way.

Speaks to multiple leverage points.

• Anticipation of Out of Pocket Revenue and Expenses for Providers and Consumers
• Financial Education can better inform consumers what medical expenses they can expect in the coming years and advise of risks that those expenses would increase.
• Smoothing the vicissitudes of individual financial context in the face of the cost of healthcare events
• Proper financial education can help consumers build the assets needed to ride out a medical event.
• More accurate knowledge can help individuals purchase the insurance they really need.
• Risk sharing at the micro level balanced against risk management at macro level
• For people to properly shoulder their own financial risk and not become a burden to a provider they need to understand their risks and the options for handling those risks in advance of any medical event.