With each open enrollment, insurance costs increase and become a growing source of stress for individuals and families. Those not eligible for a tax credit may feel bookended between hefty monthly premiums or going without coverage altogether (while paying the substantial tax penalty).
But many aren’t aware there is another alternative—and it’s called health care sharing.
Health care sharing plans, also known as medical cost sharing, can potentially save you and your family a lot of money on healthcare. Let’s look at the basics of how these plans work and how they differ from traditional insurance coverage.
Health Care Sharing: How It Works
Health Care Sharing vs Health Insurance
Health care sharing is not insurance, but the plans count as insurance under the Affordable Care Act (ACA). That means more affordable healthcare benefits while avoiding the tax penalty for going uninsured.
Other pros of health care sharing over insurance include:
Lower cost. Monthly costs of health sharing are usually much lower than insurance premiums, although the rules are different for what’s covered (see below). Also, the annual “unshared amount” is much, much lower than deductibles on lower-premium or catastrophic insurance plans.
Your choice of provider. There are no network requirements, and you provide your health sharing card as coverage. If a doctor won’t accept your plan and you have to pay out-of-pocket, health sharing plans reimburse your expense.
Now, the caveats: Health care sharing plans aren’t required to cover pre-existing conditions, such as cancer, diabetes, or lifestyle-related conditions like smoking. Those who have them may be declined membership or won’t have the conditions fully covered for a year or more.
Health care sharing also doesn’t typically cover the essential health benefits like wellness exams or mental health counseling.
Health Care Sharing Plan Options: How They Differ
The most popular health sharing ministries include:
Christian Healthcare Ministries
The biggest differences between health sharing ministries are their guidelines for member acceptance, if they cover alternative treatments, and whether or not they process bills electronically.
Health Care Sharing and Direct Primary Care