Building Wealth and Health: Within Kaiser’s Credit Building Program

Kaiser Permanente it’s a couple of months into a one-of-a-kind community program that focuses on helping Americans build their credit.

In examining the different social barriers to health, Kaiser realized that it was necessary to address the factors that negatively affect Americans’ financial mobility, according to Stephanie Ledesma, vice president of the national health system for community health. Economic mobility is linked to health because without it people often struggle to live a healthy life, she pointed out in a recent interview.

“When you don’t have access to financial security, don’t have access to healthy foods, or maybe you’re even experiencing homelessness or something, it really has an impact on your ability to be healthy and healthy – you just aren’t focused on those things when you can’t put food on the table, ”Ledesma said.

Kaiser identified rent reporting, which refers to the timely reporting of rent payments to credit bureaus, as a way to increase people’s financial mobility by building good credit.

On this street Kaiser seems to be the first health care system to launch a program focused on building Americans credit. So far, health systems and taxpayers have focused on other social factors that determine health, whether it be providing access to transportation, addressing food insecurity, or connecting patients to community resources.

It’s no secret that home ownership is becoming more and more challenging in the United States, and it’s an even more distant dream for people who rent or don’t have the ability to prove good credit. Those who have no credit or bad credit can end up paying a lot more for the same services than a person with good credit – in fact, according to the Alliance of credit builders.

When homeowners pay their mortgage on time, they create credit. But most renters don’t have this opportunity when making payments on time. To address this issue, Kaiser launched its credit building program in September. Over the next two years, Kaiser pledged $ 450,000 in funding to help 60 to 80 organizations offer rental reports and other credit building programs to low-income people across the country. It has already distributed funds to nine organizations, according to Ledesma.

As part of the program, Kaiser partnered with the Credit Builders Alliance, an organization that increases Americans’ access to rental reporting services. Through this partnership, Kaiser and the alliance offer housing providers the ability to promptly report credit scores to credit bureaus, which allows renters who are making timely payments to build credit.

“We recognize that credit is truly essential for economic security and mobility,” Ledesma said. “Being able to have rent reporting as part of your credit score seems like a great way for us to unlock options that wouldn’t have been available to people previously.”

By creating better credit, renters will have the opportunity to qualify for loans that can help them accomplish things like owning a home, starting a business, or going to school, he pointed out.

One of the housing providers Kaiser has provided funding to is Neighbor to Neighbor, based in Colorado. Through the grant, the organization can now cover rental reporting expenses and provide more financial education materials to its renters. Programs like this help break cycles of intergenerational poverty, which are often linked to credit, financial literacy, and access to home ownership, said Christy Hayes, Neighbor to Neighbor’s director of community operations.

Ledesma believes that other health systems also have the opportunity to enter this space.

“We actually find that when we can partner with other health systems, bigger things can happen and greater impact can occur,” he said. “We welcome the thought that other health systems may do the same or even launch the same type of programs. It is hoped that our involvement can in some way be a catalyst for the adhesion of others as well “.

Photo: Ta Nu, Getty Images

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