What to Know about Health Care Sharing Ministries

The rising cost of traditional health insurance is cost prohibitive for most Americans with entrepreneurial or early retirement dreams. From that barrier to entry has arisen an increasingly popular alternative – health care sharing ministries (HCSM’s). HCSM’s are a way for people with similar faiths and beliefs to pool their money, helping members cover their medical expenses. Members’ monthly contributions create a pool the group can draw from to help cover out-of-pocket medical expenses that the HCSM negotiates on your behalf.

When I heard of HCSM’s as an alternative to traditional health insurance several years ago, I held reserved feelings because I simply did not know enough about them. HCSM’s are not an insurance policy or product, so they are not taught as part of industry education requirements. So, I conducted a personal experiment. I contacted the three most popular HCSM’s directly to determine how something like this would work for a family like mine. Here is what I found:

Coverage

For under age 65 family plans, coverage generally includes 24/7 access to tele-med services, maternity care, hospital, surgical, and other medical expenses.  Some offer discounts on dental, vision, and prescriptions depending on the program you select, but do not allow for cost-sharing for those services.

Costs

HCSMs typically allow you to choose a program that fits your needs and your budget. The program you choose determines what portion of your medical bills you can share with the pool. Monthly contributions can depend on your age and location but are usually less than the cost of an insurance plan, making these programs a money-saving option. For my young family of 5, I found plans with monthly contributions ranging anywhere from $300 – $900 per month. These plans require the members to share in their expenses (like a deductible) anywhere from $3,000 – $12,000 per year before expenses can be shared with the pool. Which costs can be shared and how much depends on the program you select, and sometimes how long you have been enrolled in the program. HCSM’s encourage contributions more than the monthly amount, to support members healthcare costs incurred outside of the sharing requirements.

Membership Requirements

HCSM’s generally require all members to agree to live by biblical standards, live a healthy lifestyle, and be actively involved in a church. Some examples of behavior that could result in non-sharing of costs or cancellation of membership include the use of tobacco, alcohol, and illegal drugs, significant weight gain, and participation in activities that represent a willful disregard for personal safety. My elementary-age children show a “willful disregard for their personal safety” every day, as a normal part of childhood development. In fact, almost every ER trip we’ve made was the result of someone’s disregard for personal safety, so this concerned me.

Exclusions

Pre-existing medical conditions are generally ineligible or strictly limited. Routine and preventative care, including immunizations, screenings, and lab work are ineligible, as well as costs for behavioral and mental health care, and fertility/infertility care. Examples of injuries that would be limited or ineligible for sharing include accidents when protective gear was not worn, like riding a bike without a helmet or an ATV without a seatbelt. This is only a very short list of examples that stood out to me as costs that are typically covered by traditional health insurance and concerned me as a mother of three adventurous boys.

While traditional health insurance is expensive, it remains the most dependable form of transferring the risk of incurring large healthcare costs. It is critical for those considering enrolling in an HCSM to understand that these programs are not insurance, nor are they a substitute for insurance, and the payment of your medical bills is not guaranteed in any way. HCSM’s may be a viable option for a very small subset of people; those whose entire family strictly lives according to biblical standards, are all healthy with no pre-existing condition, and take zero risks to their personal safety. One misstep could result in medical bills that members become entirely responsible for, so having the funds to self-insure in those instances should be prioritized.

If you’re considering how traditional health insurance fits into your family’s financial plan or whether an HCSM would meet your family’s needs, sitting down with a CERTIFIED FINANCIAL PLANNER™ professional is a great, non-biased way to get a professional opinion.

 

Published in the Victoria Advocate.

Hannah Gohmert is a CFP® professional and the Chief Compliance Officer of Keller Wealth Advisors.