Low-cost loans help fund needed technology
Rehab hospital, bank collaborate on program
Rehab patients with disabilities now can get the assistive technology they need but can't afford through a new low-cost loan program offered by Spaulding Rehabilitation Hospital and Fleet Financial Group, both in Boston.
"Patients are exposed to wonderful technology while they are in the hospital, but they go home without it because they have no money, or insurance won't cover it, or if it does, they aren't paid back for up to 12 months," says Seymour Smith, Spaulding Rehab's vice president for development.
The loans may be made for anything - hearing aids, electric wheelchairs, palm-top computers, wheelchair ramps, and lifts for vans. "The program is for anything that increases patients' functionability and allows them to live in the community," he says.
There are no income limitations for patients in the program. If insurance won't cover something that increases their independence, they're eligible for the program.
A group of staff and volunteers brainstormed about what to do for these types of patients and decided the best thing would be to find a bank that would provide low-interest loans. "We didn't want to be acting as a bank or loan officer and get involved in finances," Smith adds.
After "knocking on the wrong doors for a while," Spaulding came to an agreement with Fleet Financial Group for the technology loan program. "We wanted a rate below the prime rate, and we wanted long-term loans. Most banks didn't see that such an arrangement would be advantageous," Smith says.
Fleet agreed to offer a 5% fixed rate on loans ranging from $300 to $15,000 with a five-year term. "For a bank of their size to look at a loan that small is performing a community service," he says. Fleet also agreed patients would not incur penalties if they repaid the loan early.
Before approaching banks in the Boston area, a committee of Spaulding staff researched other loan programs, according to Maryann Girardi, PT, ATP, of the hospital's Assistive Technology Center (ATEC) staff. The committee sent packets of information to banks and proposals for funding to foundations. ATEC representatives compiled case histories explaining the use of the equipment and made videotapes of patients using the equipment.
The program started with a $50,000 challenge grant from the Boston Foundation that was matched by an anonymous donor. Spaulding deposited the $100,000 with Fleet Bank to cover loan defaults. In the initial phase of the program, Fleet will make loans totaling only $50,000, or half of the principal put up by Spaulding.
"We don't want the hospital at risk for this program. We are going to do more fundraising to keep money coming in until it gets to the point that the money is coming back in from payments from patients," Smith says.
Spaulding invited representatives from the banks to the hospital for a tour of the assistive technology center. Once they came to an agreement with Fleet, Spaulding staff put on a training session. "We wanted them to be more sensitive to the type of clients they were going to be getting,"Smith says.
Fleet's community development vice president and representatives of the loan office attended the training session. The staff showed what kinds of devices were on the market, what kind of disabilities the people who used them would have, and how the technology could be used to improve the patients' ability to function in the community.
The program was launched on May 29 at Boston's Assistive Technology Expo. After three months, Fleet and Spaulding representatives plan to meet and discuss ways to improve the program.
The program is overseen by an advisory board of ATEC staff that meets when needed to discuss any problems and make recommendations. For instance, if patients have missed a payment or two, the group may look into what's going on and suggest giving them more time to make the payments. Or if a device costs more than the $15,000 ceiling, the advisory committee may vote to make an exception and approve the loan. However, Fleet has the final say in financial matters.
Some points to remember
If you are considering setting up a technology loan program in your community, here are some tips from Spaulding staff:
1. Arm yourself with information about your patients, the technology they need, the cost of the equipment, and how it will benefit the disabled. "Banks also were very interested in the default rate for similar programs in other cities," Smith says.
2. As your first contact, speak with the community development manager at the bank. The Community Reinvestment Act requires banks to participate in community projects.
3. Make sure the banks are aware that such a contribution will be a charitable act on their part and not a good business deal. "It's frustrating. One bank put us through all the hoops and still couldn't quite see that it would never work out as a commercial loan," Smith says.
4. Don't give up. It may take a while to find a bank willing to provide the kind of contribution necessary to make the program work.
[Editor's note: For additional information on Spaulding Rehabilitation Hospital's assistive technology loan program, contact Seymour Smith at (617) 573-2922.]
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