Health Care Sharing Ministries: An Alternative to Obamacare

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Editor’s note: The Affordable Care Act has positively and negatively affected hundreds of thousands of people so far. In an effort to help those who’ve been negatively impacted, we explore the little known world of health care sharing ministries. If you are aware of other viable solutions to keep costs down, please feel free to share.

There has been no shortage of controversy surrounding the passage and implementation of the Patient Protection and Affordable Care Act, also known as Obamacare. Opponents of the law loudly objected to many of its provisions from the beginning, and the rollout of the chronically ill Healthcare.gov website was impotent at best.

Since then, a barrage of lawsuits have accused the President of everything from doling out illegal subsidies to enforcing an unconstitutional individual mandate. But it gets more complicated. This summer, the Supreme Court of the United States ruled 5-4 that for-profit companies cannot be required to pay for certain types of birth control they find objectionable. This ruling set off a firestorm among conservative groups who disagree with the law on religious grounds. Not only that, but the conflict that followed may have spurred additional interest in a little-known provision of the ACA that allows individuals to sidestep it altogether- health care sharing ministries.

What is a Health Care Sharing Ministry?

According to HealthCareSharing.org, a health care sharing ministry is “a health care cost sharing arrangement among persons of similar and sincerely held beliefs.” Commonly pursued by those of Christian faith, their members seek to adhere to Galations 6:2, which says to “bear one another’s burdens, and thus fulfill the law of Christ.”

However, unlike health insurance, health care sharing ministries do not guarantee payment of any medical bill, nor do they accept government funding or grants.

How Do Health Care Sharing Ministries Work?

Similar to traditional health insurance, members of health care sharing ministries send in a monthly “share” or “pledge” that is then pooled to pay the outstanding medical bills of the group. Monthly “share” amounts vary by ministry and are based on factors such as age and family size. However, unlike those with traditional health insurance, members of health care sharing ministries are typically required to pay out-of-pocket for preventative care such as well visits, colonoscopies, and mammograms. Here are some other notable ways healthcare sharing ministries differ from traditional health insurance:

  • Unlike health insurance plans in the post-ACA area, health care sharing ministries are not required to accept customers with pre-existing health conditions.
  • Since health care sharing ministries are not governed by the same rules as traditional health insurance, the plans they offer can include lifetime caps on coverage. (Since the passage of the PPACA, traditional health insurance plans are no longer allowed to implement lifetime caps on coverage)
  • Since it is not traditional health insurance, health care sharing plans are not required to cover services or products they find objectionable. Services not covered by health care sharing plans can include things like birth control, smoking cessation, and drug rehab.

Who Qualifies for a Health Care Sharing Ministry?

Not only are certain procedures not covered, but health care sharing ministries also have strict guidelines as to who they are willing to accept. For example, Christian Healthcare Ministries states on their webpage that “participating adults must be Christians living by biblical principles, including abstaining from the use of tobacco and the illegal use of drugs (1 Corinthians 6:19-20), following biblical teaching on the use of alcohol, and attending group worship regularly if health permits (Hebrews 10:25).

In other words, you must go to church. Another sharing ministry, Christian Medi-share, takes their scrutiny a step further by requiring its members to not only have a verifiable Christian testimony and attend church regularly, but to only engage in sexual activity within a committed Christian marriage. And how do they verify that, exactly? I’m not sure. A third ministry, Liberty Healthshare, takes a much more lenient approach with its customers by requiring that they abstain from using tobacco products, illegal drugs, or alcohol, and agree to their shared beliefs, including these:

  • We believe that our personal rights and liberties originate from God and are bestowed on us by God, and are not concessions granted to us by governments or men.
  • We believe every individual has a fundamental religious right to worship the God of the Bible in his or her own way.
  • We believe it is our spiritual duty to God and our ethical duty to others to maintain a healthy lifestyle and avoid foods, behaviors or habits that produce sickness or disease.

Because of their vague and somewhat open set of guidelines, Liberty Healthshare remains the most liberal of the group, claiming to accept customers of all religious faiths and backgrounds, including those with alternative lifestyles and sexual orientations.

Are Health Care Sharing Ministries Cheaper?

According to the ministries who offer these programs, enrollment in health care sharing ministries ballooned through the first year of the implementation of the Affordable Care Act, and now includes more than 300,000 customers. Many of those customers have undoubtedly joined based on religious beliefs alone-including the fact that ministry plans are not required to cover services such as abortion and drug and alcohol-related illness.

Other customers join health care sharing ministries in order to comply with biblical principles that call on them to “bear each other’s burdens,” as Galations 6:2 suggests. But what about the rest? A growing body of research seems to indicate that many ministry customers- some religious and some not- have chosen to opt out of traditional health insurance due to financial reasons alone. In other words, health care sharing ministries are cheaper. 

Remember, health care sharing ministries are not required to accept customers with pre-existing conditions or pay for preventative care. Not only that, but they are also non-profit entities at this point, with no motive to bring in a profit beyond paying for administration of the plans. Further driving down costs is the fact that, unlike health insurance, sharing ministry plans can place lifetime caps on their policies. All of those changes mean that premiums or “shares” offered through sharing ministries wind up being cheaper than traditional health insurance in the post-ACA era.

Sharing Ministries vs. Traditional Health Insurance

According to government number-crunchers, the U.S. spends more per capita on healthcare that any other industrialized country- currently around 17% of GDP. And it is expected to get worse. As you can see in this chart, the Centers for Medicare & Medicaid Services projects that the cost of healthcare in the U.S. will double by 2022. healthcare double With those kinds of numbers on the horizon, it’s no wonder that so many cost-conscious families have put some serious thought into switching from traditional health insurance to a health care sharing ministry. But, how much would they save? Let’s start with my own family.

There are four of us, ages 34, 35, 5 and 3, and we currently reside in a suburb just north of Indianapolis, Indiana. Since we make over 400% of the FPL (Federal Poverty Limit), or more than $94,000 per year, we do not qualify for subsidies that would lower the cost of traditional health insurance and must absorb the full premium cost of any plan we purchase. (See Related: Obamacare: The Good, the Bad, and the Ugly)

This below chart compares how much we would pay if we chose the cheapest traditional health insurance plan available in our county and state in 2014 and what we would pay if we chose the best coverage offered by each of the main health care sharing ministries: Health Care Sharing Ministries chart Now, keep in mind, it is actually much more complicated than this chart would have you believe. For the sake of simplicity, I only included the most expensive plan offered by each of the ministries mentioned and I didn’t include any of the add-ons that they offer, such as extensions on lifetime caps. For example, Christian Healthcare Ministries offers a program called “Brother’s Keeper” which covers costs over and above $125,000 per illness.

Likewise, Samaritan Ministries offers a “Save to Share” program that covers costs for members whose medical costs exceed $250,000 for a specific medical need. Still, when you compare these plans with the cheapest traditional health insurance plan with a $12,000 deductible, the cost savings are evident. With potential savings of more than 50 percent, it becomes easy to see how a family with few health problems would throw caution to the wind and take their chances, right?

Health Care Sharing Ministries: An Alternative to Obamacare

Beyond financial constraints and religious objections, many people are signing up for health care sharing ministries simply to avoid paying the individual mandate tax that the PPACA assesses on individuals who fail to purchase qualifying coverage during any given year. In 2014, the penalty only amounted to $95 or 1 percent of household income, whichever was greater. However, by 2016, the penalty will climb to $695 per adult or 2.5 percent of household income. No matter which side of the debate you are on, that’s a lot.

The bottom line is this: Health sharing ministries, while not perfect, do provide an alternative for people who cannot afford the new ACA-approved plans or object to them for political or religious reasons.  And with healthcare costs expected to double over the next decade, it is safe to say that healthcare sharing ministries are here to stay.

Reders, Have you heard of health care sharing ministries?  Would you consider joining one?  Why or why not?

Note: ObamaCare was signed into law in March of 2010, requires you to have insurance by 2014, expands Medicaid in 2014, and requires large employers to insure full-time workers by 2016. Open enrollment in ObamaCare’s marketplace ended March 31st, 2014. The next open enrollment starts November 15th, 2014.

Photo Credit: Healthcare Costs by Images Money is licensed under CC BY 2.0

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Holly Johnson

Holly Johnson is a financial expert and award-winning writer whose obsession with frugality, budgeting, and travel plays a central role in her work. In addition to serving as Contributing Editor for The Simple Dollar, Holly writes for inspiring publications such as U.S. News and World Report Travel, Personal Capital, Lending Tree, and Frugal Travel Guy. Holly also owns two websites of her own - Club Thrifty and Travel Blue Book. You can follow her on Twitter or Pinterest @ClubThrifty.

8 comments

  1. Cody With SMI

    Thank you for writing a very informative article about health care sharing ministries. As you noted, thousands of Americans are discovering the blessings and benefits of these ministries, and why they may be a better fit for their family than an insurance policy.

    There are just a few things I’d like to correct, however.

    You wrote: “Unlike health insurance plans in the post-ACA area, health care sharing ministries are not required to accept customers with pre-existing health conditions.”

    Correction: Samaritan Ministries International does not reject anyone for preexisting conditions. In fact, many members come into SMI with preexisting conditions. Preexisting conditions do, however, limit what can be shared for subsequent issues directly related to the preexisting condition. This is why we developed a sharing vehicle called a Special Prayer Need (SPN). If a member has a preexisting condition, and it is a burden to them, then they can submit it as a Special Prayer Need. We will then publish that need to our members and ask them to give above and beyond their monthly share amount in order to help alleviate the burden. This is done on a “free-will offering” basis, and the amount that the member receives will vary depending upon the other members’ generosity.

    You wrote: “Since health care sharing ministries are not governed by the same rules as traditional health insurance, the plans they offer can include lifetime caps on coverage”

    Correction: Samaritan Ministries does not have lifetime caps. We have a per incident cap of $250,000, unless that member opts to take part in our Save to Share program, which then removes that cap. If someone were to have 8 publishable needs in one year for example (God forbid), then each need would have a $250,000 limit; no yearly/lifetime cap is in place, just the per incident cap, unless they were members of Save to Share.

    I hope that clears up a few minor misconceptions. Thanks again for such a fair minded article about the changing landscape of American health care.

    Reply
    • [email protected]

      Hi Cody!
      Thanks for speaking specifically about Samaritan. That’s good to know. However, the article is written about all healthcare sharing ministries so I do stand by what I wrote. Health care sharing ministries are not required to accept people with pre-existing conditions. For example, Christian Healthcare Sharing ministries states that they do not share bills with members who are actively seeking treatment for a pre-existing condition. http://www.chministries.org/preexistingconditions.aspx
      Obviously, the new healthcare law made is so that people with pre-existing conditions can no longer be denied coverage or have to endure any kind of waiting period.

      The same is true about lifetime caps. I think it’s great that Samaritan offers certain coverage beyond the typical $250,000 per incident cap. However, customers much purchase additional coverage to remove the per incident cap- unlike post-ACA insurance which is no longer allowed to put any caps per incident, illness, or lifetime.

      With all of that being said, I really like the health care sharing ministry product. In fact, my family plans to join one later this year instead of buying the $800 per month/$12,000 annual deductible policy that I referenced in the article.

      Thanks again, Cody!

      Reply
  2. Financial Samurai

    Holly and Cody,

    This is a pretty fascinating topic in my mind b/c I think the majority of people do not know what a Health Care Sharing Ministry is. I didn’t, and I asked 10 friends who aren’t familiar either.

    You mentioned that going to Church is a requirement for one to join. For others, and the most liberal one, how does one prove they are religious? Can they just say they are religious and go from there? Or, is there like some religious membership card one has to show?

    Just trying to figure out how easy it is for a family to join one. I can see a lot of discriminatory issues that might arise, but hope not!

    Sam

    Reply
    • Holly Johnson

      I just did a little research and it looks like they all have different requirements. Samaritan’s website has a list of guidelines and that includes this:
      “Have your pastor or church leader sign a statement confirming that you meet the above
      requirements. Hebrews 13:17”
      So it sounds like you need to have some proof that you belong to and attend church. The other ministries (aside from Liberty HealthShare) have similar requirements. From my understanding, Liberty Healthshare doesn’t require you to “prove” anything. You simply need to agree to their shared beliefs which are fairly vague and not very controversial.

      Reply
  3. Michelle

    That is a very big fine to pay for not paying for health care. I am just thinking to myself that if people can’t afford to pay the premium for health care than they certainly cannot afford to pay the fine either. I am interested to see what happens with this a year or two down the line.

    Reply
  4. George

    I met new friends recently at a Christian camp who have a similar insurance plan set up and they are very happy with their costs and satisfied with what they get. They told me that almost everyone in their church and church circles have this type of insurance. These folks are typical middle class. I was also fascinated when I heard about this option so I’ll be investigating it a bit more.

    Reply
  5. Jim Young

    Good article.

    I am a member of Liberty Healthshare but am concerned because of the coverage limits especially for prescription drugs.

    I buy “insurance” to financially protect against catastrophic events such as cancer. Cancer drugs can cost $180,000 a year for a single drug and that doesn’t include the supporting drugs. Liberty Healthshare limits the payment of prescriptions to 45 days. After that you’re on your on. So I’m beginning to think that Liberty will not protect me and my family that way I would expect “insurance” to protect us.

    Reply
    • Mom of 3

      Jim,

      Cancer coverage was a big concern for me as well. The following was shared with me by a Medi Share rep, it comes directly from their guidelines:

      • Prescription drugs – Prescription medications, including allergy injections, are eligible for sharing for six months per each new condition that is not pre-existing. This includes prescription drugs that may be dispensed, injected or administered by a Medical Doctor (M.D.), Doctor of Osteopathy (D.O.), Nurse Practitioner (N.P.), Physician Assistant (P.A.), or Doctor of Podiatric Medicine (D.P.M.). Exceptions may be made in the case of medications for cancer and transplant recipients.

      Reply

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