What are Healthcare Ministries?
Healthcare ministries can also be referred to as healthcare sharing plans. They may be a type of health coverage but they are in no way insurance. Usually members share some type of religious belief, (although not always) and they make a commitment via contract to make monthly payment to help cover the healthcare expenses of other members. The hope is that if coverage is ever needed, that favor will be returned.
However, that is often not the case. They are largely unregulated and although the insurance system is far from perfect, health sharing ministries are rife with corruption and horror stories.
Insurance vs. Healthcare Ministries
Insurance requires you to pay a monthly premium in return for set copays or coinsurance as dictated by the terms of the plan. You may have to meet an out of pocket deductible but after that your plan should detail the costs of services. These costs, of course, depend upon your plan and carrier and whether your doctor or hospital is in or out of network. All plans must have an out of pocket maximum which should protect you in case you incur large medical bills.
Healthcare ministries are NOT insurance. Basically, you and a group of people contribute a small amount of money on a monthly basis. This money is pooled together and held for when a member is in need. Depending on the terms of your “plan” you may be able to be reimbursed for a portion of certain medical expenses after you have paid.
Healthcare ministries are NOT health insurance. As a result, you may not have any type of legal recourse should you experience difficulties with your plan.
Eligibility
The first drawback of healthcare ministries is eligibility. Under the ACA, you cannot be denied or charged more for any preexisting conditions. This is not the case with healthcare ministries. For example someone with diabetes could be charged more on a monthly basis. A child with cancer could be denied outright.
Additionally, eligibility can be affected by your personal religious beliefs. If you don’t share or practice the same religion as dictated by your healthcare ministry, you may be denied. If your life does not subscribe to the morality clause as outlined in your plan, you may not be eligible.
Coverage
Under the ACA, you cannot be charged more or denied for a pre-exisiting condition. This is not the case with health sharing ministries. You can be charged more or denied, you can even be forced to pay more if you gain weight.
There’s no such thing as essential benefits. Many benefits may not be covered if they do not subscribe to the morality cause. For example, very often treatment for substance addiction will not be covered because it violates the plan’s “morality clause”. Unfortunately it can go even further than that.
There was even a reported story where a young woman was denied reimbursement for a broken limb. How could that be considered immoral? Because it happened in a bar…
A ministry can refuse to reimburse you because they feel that the medical needs violate their morality clause. In all honesty, perhaps you agree with these terms. However, because these terms are not clearly defined in any type of contract, you may find yourself denied for reimbursement. Ambiguity in finances and healthcare is far from ideal.
Money
Another major issue surrounds the financial workings these plans.
ACA and group health insurance plans have an out of pocket maximum. So, if you become very ill at some point your insurance will step in to cover the remainder of the bills to protect you from large, covered, medical expenses.
Not only is this not the case with health sharing ministires, it is just the opposite. Your benefits usually have some type of yearly cap and after that, you are on your own.
Additionally, there is an issue with how payments are issued. Basically first, you negotiate a cash payment with the doctor or hospital. Then you submit your receipts or bills to your plan and await reimbursement. This can be problematic.
1. Your reimbursement could be denied based on what we’ve discussed already.
2. If you pay upfront, that could be a financial hardship.
3. If you wait, your bill may end up going to collections while you wait for your plan to reimburse you which can be extremely unpleasant.
Finally, there is much less regulation than insurance. ACA plans have the 80/20 rule. So at least 80% of your monthly premiums must go towards paying healthcare costs. No such rules exist with healthcare ministries so most of your money could be going towards marketing or administration which could explain the difficulty in getting reimbursed.
Jesse Smedley is the Principal Broker for iHealthBrokers and the founder, president, and CEO of Smedley Insurance Group, Inc. and iHealthBrokers.com. Since the inception of SIG in 2007, Jesse has been dedicated to helping people save money on their health insurance by providing them with resources to educate themselves on all their health insurance options, both under age 65 and Medicare beneficiaries. He is featured in many publications as well as writes regularly for expert columns regarding health insurance and Medicare.
