Startups

Exclusive: Tuition.io adds healthcare lead to head up new vertical

Tuition.io, a startup based in Santa Monica, California, enables companies to offer a benefit that can help workers manage and repay their student loans.

The average physician leaves medical school with more than $190,000 in student debt, according to data from the Association of American Medical Colleges. More than 86 percent of medical school students graduate with some level of debt.

Tuition.io, a startup based in Santa Monica, California, is attempting to lower those numbers by enabling companies to offer a benefit that can help workers manage their student loans through financial wellness guides, payment and financing tools, and direct contributions to employee loan repayments.

That company was founded in 2011 and has raised more than $15 million in  funding from investors including Wildcat Venture Partners and the venture arm of insurance company MassMutual.

Based on traction the company has found in the healthcare market, with customers like Children’s Hospital of Omaha and Mosaic Life Care, Tuition,io is expanding its presence in the industry, hiring clinical pharmacist and student loan activist Jeni Burckart to lead the new vertical.

Like many of her colleagues in the healthcare industry, Burckart knows the struggles with student loan debt intimately. She graduated pharmacy school in 2013 with $132,000 in debt and failed to refinance her loans, a costly inaction that wasted thousands more in repayments.

Jeni Burckart, senior director of healthcare at Tuition.io

The experience started her on the path toward helping others pay down their student loan debt and authoring the book “Repayable” on student loan repayment.

Burckart said she decided to join the startup as part of an opportunity to merge her activism around student loans and her background and training in healthcare.

“Healthcare workers, because of the higher levels of education required, have an especially acute problem with student loan debt,” she said in a phone interview.

“This is a mission I can get behind because healthcare is a field that is afflicted with a shortage and as health needs increase, the system needs to figure out how to deal with that shortage while maintaining good quality of care.”

According to a report from consulting firm Mercer, America will need an additional 2.3 million healthcare workers by 2025 to deal with its aging population.

While the student debt problem is especially acute in the healthcare industry, healthcare workers have advantages in terms federal loan forgiveness programs and local, state and regional repayment and loan forgiveness programs for certain research efforts and specialties.

Burckart said one of her initial priorities at the company will be developing features and tools that can help healthcare workers identify and access these programs.

“This is really for health systems of all kinds. Both acute care clinics like hospitals, but also rehab clinics, adult disability centers and places that provide long-term care, because even though they may not have surgeons, they still have a specialized nursing workforce, they still have physicians on staff and their turnover rates are particularly high,” Burckart said.

That turnover can be expensive. The estimated cost of replacing a physician including recruitment, start-up and lost revenue costs can be up to $1 million. And that calculation doesn’t take into account the potential drop in patient safety and outcomes due to excessive turnover.

According to Tuition.io, the company’s healthcare customers have seen a 21 to 48 percent reduction in employee turnover rates, when comparing employees receiving the benefit relative to employees eligible for the benefit but not participating.

And while student loan debt is a problem generally associated with millennials, around 25 percent of the Tuition.io’s healthcare business comes from those over 40.

“By being able to teach staff and help them solve a personal financial concern, hopefully this is a way to decrease the overall cost of healthcare,” Burckart said. “If you can keep healthcare quality high and lower the amount of turnover, patients ultimately benefit in the long run too.”

Photo: JamesBrey, Getty Images

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