California has banned short term medical plans in the state beginning in 2019. This leaves many individuals who have lost their health insurance or have no health plan without an option for major medical coverage. In some circumstances health care sharing plans may meet the minimum need to at least have some coverage for major medical hospital treatments. But consumers need to read the fine print before signing up.
Health Care Sharing Plans For Short Term Medical Coverage
Contrary to what our elected officials believe – the people who banned short term medical plans in California – some people find themselves without any health insurance. If they missed open enrollment, don’t have a qualifying event for a Special Enrollment Period, or don’t have access to an employer group plan, no health insurance company, including Covered California, will let a person enroll in a health plan. This is particularly troubling for people who earn too much to qualify for Medi-Cal. There are many self-employed individuals who lose their health insurance because they fell behind on making the monthly premium payments. Once you have been terminated for lack of payment, you can’t enroll in a health plan until the next open enrollment period.
One option to consider, if you find yourself in this boat, is a health care sharing plan. Health care sharing plans are not insurance. There is no a guarantee to cover any eligible health care service IF the plan member has not met all the terms and conditions of the plan. The member must agree to live either by a statement of faith or statement of standards. These lifestyle conditions lean heavily on religious principles. Health care expenses that fall outside the boundaries of the life style conditions and belief system are subject to denial.
In addition, heath care sharing plans do not have to cover pre-existing conditions or even maternity. This doesn’t mean that if you have a pre-existing condition you won’t be approved to participate in the health care sharing plan. It means that the plan is not under any obligations to cover expenses related to pre-existing conditions.
Health Care Sharing Ministries
As the name implies, member contributions flow into an escrow fund and are then shared with other members who have eligible health care expenses. The sharing is in form of paying a portion of a submitted health care expense or the total invoice amount, depending on the structure of the plan. For some people, this means that the health care sharing plan will cover a true medical emergency at a hospital after they meet their Member Responsibility Amount (MRA). The MRA is the dollar amount the member must cover before any of the plan’s funds can be shared to cover the rest of the heath care expense. Because the first health care sharing plans were organized by people associated with a religious faith, they are commonly referred to Health Care Sharing Ministries (HCSM).
Even though God is forgiving, and will give you a second chance, HCSMs will not. If your health care expense was found to arise by virtue of you having broken the statement of standards, or not fully disclosing your medical history, it won’t be covered. Because humans are, well, human and prone to a lapse in judgement, it’s best to view the HCSM in the narrowest of terms. This means it is most applicable to heath care expenses for accidents.
When I say accidents, I mean things totally out of the blue like, literally, getting struck by lightning. (Unless the lightning strike was issued by God for your poor behavior.) I’m am talking freak accidents, no one could ever foresee, and did not occur because of a participation in a high-risk sport or illegal activity.
Unless you are a big proponent of the health care sharing plan model and are fully dedicate to live by the terms, conditions, and standards of the plan, I don’t recommend them for long term enrollment. As a short-term major-medical coverage alternative, health care sharing plans may be appealing for certain individuals and families.
If you think regular health insurance is filled with loop-holes and caveats to avoid paying health care claims, read the fine print on the HCSM. It can be difficult to know if the HCSM will pay on certain claims under certain conditions. Then there is the wild card of denial because of how the injury or illness occurred that is not explicitly included or excluded in the plan. For example, if you are at a gay bar and are dancing, then trip and break your ankle, will it be covered if the HCSM does not approve of activities involving the gay community?
Who is the ideal candidate for a health care sharing plan?
- healthy adults
- Non tobacco users
- No pre-existing or chronic medical conditions requiring prescription drugs
- Consumes very little or no alcohol
- Doesn’t use recreational drugs
- Doesn’t engage in high risk sports or activities
- Doesn’t foresee becoming pregnant
- Can abide by the plans statement of standards for a healthy and moral lifestyle
- Have the ability to comprehend the terms and conditions of plan
As a health insurance agent, because short term medical plans have been banned, I want to offer some sort of coverage to people who cannot get health insurance otherwise. The only alternative in the market place are HCSMs. I found one HCSM that is pretty straight-forward called Altrua Select Silver 2750 represented by USA Health Plans. Altrua is the HCSM and Select Silver 2750 plan is represented by USA Health Plans.
The Select Silver has a $2,750 Member Responsibility Amount (MRA) per calendar year. Before any sharing for health care expenses can be made, the MRA must be met. This is no coverage for office visits or over the counter prescription drugs. There is also a life time maximum sharing benefit of $1 million. Telemedicine is $0 per phone call. In general, the Select Silver 2750 is for health care provided to you by a facility such as an emergency room or outpatient surgery.
There is a long list of medical conditions such as cancer treatments that have a one year waiting period. Excluding a true medical life-threatening emergency, there is no coverage for a medical need that requires prior authorization in the first 90 days of the effective date membership. There is a long list of health care services that are not covered such as maternity, mental health, and injuries associated with sports programs.
Statement Of Standards
If you feel you are a good candidate for an HCSM, can you then accept and abide by the Statement of Standards of the plan.
- I BELIEVE in caring for one another.
- I BELIEVE in keeping my body clean and healthy with proper nutrition.
- I BELIEVE that excessive alcohol consumption, as well as the use of tobacco or illicit drugs, is harmful to the body and soul.
- I BELIEVE sexual relations outside the bond of marriage is contrary to the teachings of the Bible and that marriage should be held in honor.
- I BELIEVE abortion is wrong, except in a life-threatening situation to the mother.
- I BELIEVE it is my obligation to care for my family, and that physical, mental, or emotional abuse of any kind to a family member, or to anyone else, is morally wrong.
Health care sharing plans are not insurance. They don’t use the same terms or follow the same rules as traditional health insurance. If the plan meets the criteria set by the U. S. Department of Health and Humans Services under the ACA, they are referred to as Health Care Sharing Ministries and participation in a HCSM exempts an individual from any individual mandate penalty.
The only reason to have coverage for freak accidents is because hospital costs are so utterly and ridiculously high. The value proposition is that by being a member of a HCSM and making monthly contributions – assuming you have a true-life threatening emergency or medical condition that arises and needs in- or out- patient treatment – you have a high probability of having some of your health care expenses shared. Monthly member contributions range from $160 to $275. Families will see monthly contributions from $295 to $525.
Below is the link to get quotes and additional information for the USA Health Plan Select Silver 2750 Altrua Health Care Sharing Ministry plan.
However, please do not enroll until you have contacted me and we have had a chance to discuss your particular situation. It is super important that you understand all the terms, conditions, and restrictions of the HCSM plan. In lieu of a short-term medical plan, the Select Silver 2750 HCSM plan may be the best option for the uninsured until the next open enrollment occurs in the fall for the next calendar year.