How Health Care Sharing Ministries Work
October 27, 2014
Americans continue to lose their insurance plans under Obamacare, and with 2015 open enrollment starting on November 15, those with cancelled plans will have to find new ones, or else pay the individual mandate tax. For 2015, the mandate penalty is the greater of 2 percent of annual household income or $325 per person.
Holly Johnson at U.S. News and World Report recommends that those facing insurance cancellations look at health care sharing ministries (HCSMs) before they head to the Obamacare exchanges. As of today, 300,000 Americans across the 50 states are enrolled in HCSMs, which share costs among those of similar religious faiths. Johnson explains:
- In general, a HCSM is a nonprofit Christian group that allows members to pool funds in order to cover medical expenses.
- The plans have different terms, but in general require that a person spend a certain amount of money out-of-pocket before the ministry covers additional expenses. For example, a plan might cover medical expenses after a family has expended $1,500 on medical bills.
- HCSMs are not required to cover all medical procedures and can deny those with preexisting conditions to join the group.
- There are often lifetime caps on coverage, and the costs of well visits and preventive care are up to the enrollee.
The result? Sharing ministry plans are much less expensive than other insurance plans. Johnson provides an example: a family of four could purchase traditional insurance for $700 per month, or they could purchase HCSM coverage for less than $200 per month. While they may not cover as many expenses as Obamacare-regulated insurance, they provide catastrophic coverage and are much less costly.
Source: Holly Johnson, "Can't Afford Obamacare? Consider a Health Care Sharing Ministry Instead," U.S. News and World Report, October 24, 2014.
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