Business students hope to erase $1 million in medical debt
As a doctor, Syed Shehab learned first-hand how America’s medical system works – or doesn’t.
“Over 60% of personal bankruptcies in the U.S. are because of medical debt, On top of that, if you have this medical debt that is on your credit report you cannot build credit in the U.S. You cannot get a car, get a mortgage, so on and so forth.”
So he decided to get an MBA – to study ways of improving healthcare in America, and – for now – he and others at UVA’s Darden School of Business have launched the One to One Hundred Project. In partnership with a national non-profit called R.I.P., they’re raising money to buy medical debt.
“If the hospital or insurer is unable to collect, they usually sell that debt to the secondary markets. These are your collection agencies, and they sell them at a steep discount, because they just want to make some money and get that debt off their balance book,” Shehab explains.
Collection agencies sell their most difficult cases at an even bigger discount to R.I.P.
“Usually they’re able to do it in a one to 100 multiple, which basically means that for every dollar they’re able to buy $100 of medical debt.”
Shehab and his colleagues hope to raise $10,000 – enough to write-off a million bucks in medical debt for struggling families in and around Charlottesville. I’m Sandy Hausman.
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