COVID Crowdfunding Entrenches Health Inequalities
A study set to be published in the August issue of Social Science & Medicine found that Americans created over 175 000 COVID-related crowdfunding (CCF) campaigns in the first half of 2020, with many receiving no funding at all and campaigns in the most privileged areas receiving the most funding.
During the first year of the COVID crisis, many Americans turned to charitable crowdfunding for help with medical bills, funeral expenses, lost wages, small business support, food assistance, and other needs. CCF increased exponentially after March 2020 on platforms such as GoFundMe. Europe saw CCF focusing largely on support for medical facilities and workers, while the majority of US CCF aimed to support individuals, raising money for food, rent, funerals, and other expenses. In India, which only spends 1.2% of its GDP on healthcare, huge numbers of people are turning to crowdfunding in an attempt to cover costs caused by patchy medical insurance which often does not cover COVID-related illness, nor the significant outpatient costs.
According to GoFundMe CEO Tim Cadogan, the platform saw “unprecedented use,” in the first few months of the COVID pandemic, and crowdfunding “activity has persisted at an alarming rate” since then. Unlike most disasters, which generally have an acute phase of destruction followed by a recovery phase, the economic and health impacts of the pandemic are long-lasting, a trend reflected in the prolonged growth of CCF campaigns. Between March and August of 2020, GoFundMe reported that more than 150 000 CCF campaigns had been started.
Drawing on a large dataset of geo-tagged CCF campaigns started on GoFundMe between January 1 and July 31, 2020, researchers found a number of surprising results in their analysis.
They found that the median campaign raised only $65 out of a $5000 goal, with a median of 2 donations. A striking 43.2% of CCFs received zero donations, with more than 90% not reaching their campaign goal. This is worse than reported in prior research; a 2017 study of medical campaigns found only 3.5% had no donations.
Medical fundraising made up 18.3% of all CCF campaigns, and those indicating severe medical needs, with terms like “ICU”, received an average of 96 donations, and an average donation size of $197, while campaigns mentioning “rent” or “eviction” received an average of 23 donations, with an average size of $84. Campaigns seeking money for businesses or PPE fell between these extremes.
The researchers also noted that CCF campaigns are created most often in the highest-income areas, not those hardest hit by COVID. Previous research on charitable crowdfunding has shown that it exacerbates social inequities by providing financial relief primarily to privileged recipients. Previous economic and ecological crises have also been used by powerful individuals and institutions to serve their own interests, deepening inequities and health disparities during recovery.
“We find a significant disconnect between COVID- related needs, and the ability to adequately and equitably address them with crowdfunding. CCF campaigns face heightened competition, and steep inequalities between winners and losers,” the authors wrote. “Campaign success increasingly accrues among those with more social and economic capital.”
Journal information: Igra, M., Kenworthy, N., Luchsinger, C. and Jung, J., 2021. Crowdfunding as a response to COVID-19: Increasing inequities at a time of crisis. Social Science & Medicine, 282, p.114105.
