THE RISKS AND REWARDS OF HEALTH SHARING MINISTRIES

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With the cost of healthcare premiums still on the rise year after year, many Americans find themselves searching for new ways to stretch their dollars and save on healthcare.  If you have been researching options to loosen your budget, you may have discovered Health Sharing Ministries and are wondering exactly what they are, how they work and if they could be your answer to saving on the skyrocketing costs of premiums, deductibles and co-insurance.   

Health Sharing Ministries (HSM) are faith-based programs that enable members to share eligible healthcare expenses among the group.  Instead of paying a monthly premium to an insurance company, members pay a monthly “share”, which is used to cover the cost of other members’ approved healthcare expenses, in accordance with ministry guidelines.  These monthly “shares” are significantly less than the premiums for traditional health insurance.  Rather than having an insurance company cover and negotiate healthcare costs, members of these groups pay for each other’s healthcare needs by pooling resources and sharing what they have, with the HSM acting as the administrator.  (It is important to know that HSMs are not health insurance, and they are not contractually obligated to cover any specific healthcare needs, so there is no guarantee of payment.) 

Health Sharing Ministries have been around for decades, but they began receiving much more attention as traditional health insurance became mandatory, and HSMs met the former ACA requirement that individuals purchase healthcare coverage or be subject to a tax penalty (repealed in 2019).  Low monthly rates have attracted many and drastically increased enrollment since the introduction of the ACA in 2012;  however, before jumping in, it is important to understand the details of HSM enrollment and just how comprehensive the coverage really is (or is not).  

What Makes HSMs Appealing?

Low Cost and Big Discounts – Many people are drawn to HSM coverage because of the significant monthly savings.  The monthly “share” amount that a member pays to help cover others’ healthcare costs is usually significantly less than available marketplace plans.  When an individual is enrolled in an HSM, they are viewed as a “cash pay” client, which generally entitles them to much steeper discounts on services (40% and beyond) than if they were to have their claim submitted to an insurance company.  This means enrollees would get big discounts on medical bills because they would be paying cash for services.

You Can Keep Your Doctor – Most HSMs do not have a network of providers, so members are free to receive services from the physician, pharmacy, lab or other facility of their choice.  While members are free to choose their provider, there is no guarantee that the chosen provider will accept their sharing ministry coverage.

There Is No Moral Conflict –  Insurance companies use premiums to cover services that some find objectionable.  An HSM is appealing to many because members know exactly what services their “share” is paying for, and they have peace of mind knowing they aren’t contributing to healthcare choices that may be in conflict their value systems, such as birth control or abortion.

Supplementing Medicare Costs – Many health sharing ministries offer programs to supplement Medicare costs, acting as a “sharing” version of Medigap insurance.  Some programs offer these supplemental programs at lower rates than the standard monthly share for individuals that are not enrolled in Medicare.

Concerns

While the low cost, freedom of choice and sense of community among members can make a health sharing ministry appear to be the perfect fit for your situation, there are some concerns about this form of coverage that you should be aware of before enrollment.

No Essential Benefits – HSMs do not offer the comprehensive coverage that traditional health insurance provides.  The Affordable Care Act requires that all individual and small group plans provide coverage for 10 essential benefits, such as maternity, mental health, prescription drugs, preventative coverage and pediatric care.   Health Sharing Ministries are not health insurance; therefore, they are not regulated and do not have the same requirements. There is no guarantee that bills for these essential benefits will be shared, which could lead to coverage gaps and paying more out-of-pocket than originally anticipated.  For example, most HSMs do not cover preventative and wellness visits, vaccinations, or immunizations, and they limit or exclude prescription drug sharing.  You may end up paying for the entirity of your annual check-up, mammogram or colonoscopy out-of-pocket.

Pre-existing Conditions – Those with pre-existing conditions may find that an HSM is not the right option for them.  HSMs usually enforce a long waiting period before any bills related to a pre-existing condition can be shared (at least a year, and in some cases, up to 36 consecutive months).  When they are eligible to be shared, they are shared at a much lower rate than other eligible incidents.  One of the 4 leading HSMs states in its guidelines that an individual must be symptom-free or a loyal member for 36 consecutive months before sharing for a pre-existing condition, and sharing for that condition is capped at $100,000/year.  Once they have been symptom-free or consistently sharing for 5 years, that sharing cap increases to $500,000/year.

Fluctuating Rates – While HSMs can have a lower monthly rate than marketplace plans, those rates can fluctuate based on a member’s health status.  If a member has a health condition that is deemed “correctible,” such as high cholesterol, one of the most popular HSMs will assign that member a health coach and add an additional charge for this.  Once the health condition has been “corrected”, the member will no longer need the health coach, and their share will decrease. Others have different tiers of pricing based on a member’s health – they have a lower monthly share if they are in better health.  In turn, if members experience significant weight gain, they will be enrolled at a higher monthly rate.

HSMs Are Not For Everyone

While Health Sharing Ministries certainly appeal to those who are healthy and do not need regular medical care, they are not the right fit for everyone.  Because HSMs are faith-based organizations, they typically require a profession of Christian faith and, in some cases, verified regular church attendance in order to enroll.  If you are not a professing Christian, it is likely that an HSM will deny your enrollment application.  If you have a pre-existing condition, you will find that most of your medical costs will not be covered by an HSM.  Due to waiting periods, short-term prescription coverage, and the exclusion of preventative care, there will be large gaps in coverage that traditional insurance would usually fill.  
Because HSMs also do not cover treatment for injuries related to reckless behavior (such as riding a motorcycle), illnesses or rehabilitation related to tobacco, recreational drug and alcohol use, or STDs or maternity care resulting from extra marital relationships, if you engage in these activities, you will find that an HSM does not work well with your lifestyle and may not provide coverage when you need it.

We’ll Help You Find The Right Fit

Everyone is searching for the best way to save on healthcare coverage, but some may find that the risks related to a Health Sharing Ministry outweight the benefits.  If traditional health insurance better meets your needs, we can help.  While RedQuote does not currently offer HSM enrollment, we will work diligently with you to find the best traditional health plan and coverage for your family and your budget.  Call RedQuote today to see what we can do for you.
 

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Published Mar 8, 2019.