What is Healthcare Sharing (HCS)

You may have heard of Medi-Share or Samaritan MinistriesTM.  Both are healthcare sharing (HCS) organizations that have a community of members that join together for the purpose of sharing one another’s healthcare expenses.  Both HCS ministries have been around over 20 years and have tens of thousands of satisfied members.  HCS ministries are specifically recognized by the Affordable Care Act.  The law even provides an exemption[1] from penalties for not having insurance for individuals who participate in a bona-fide HCS ministry.

Since the Affordable Care Act was signed into law on March 23, 2010, HCS participants have grown in number from approximately 100,000 members to over 700,000 members today!  Why has this solution to pay for medical services grown over seven fold in the past 6 years?  Well, there are a number of reasons.  Here are a few:

  1. Probably the biggest reason is the principle alignment of moral, ethical and spiritual values offered through the Sharing Ministries.
  2. Another big reason is the monthly cost to participate in HCS is in the range of 30-50% lower than traditional health insurance monthly premiums.
  3. Members are also allowed to use the doctors and medical services of their choice, within certain guidelines, but not nearly as restrictive as a typical HMO or PPO network.
  4. A true community experience of “like-minded” consumers is lived out as they contribute money on a monthly basis to be shared by members in need. Truly, relationships develop and grow between members as they support each other through prayer, encouragement and sharing.
  5. The dollar amounts shared are astounding, as just one of the communities has published that in 2017 the needs expected to be shared by its members is nearly $20 million per month!
  6. So much bureaucratic red tape is eliminated since HCS is not insurance which equates to ease of use and lower cost. No insurance company “middle man” telling you who you can access for your care.

What is really exciting in the HCS world is there is now a solution for employer sponsored group plans!  All of the benefits above, and more, are now available on a group platform for employers to offer their employees.

Cost savings compared to traditional group health insurance can be dramatic as well as out-of-pocket savings to the member when they need to utilize medical services.

Here’s an example of how someone could receive medical care and how the bills go through the sharing process.

  1. A member experiences a medical emergency and is transported to the ER at a hospital.
  2. The member is admitted to the hospital and has emergency surgery.
  3. After a week stay at the hospital the member is released to go home.
  4. The member has follow up visits including physical therapy as a result of the medical condition.
  5. The member also has to fill some prescriptions.

Here’s how the process works to share the expenses with the community.

  1. The member presents themselves to their medical providers as a self-pay patient and requests to be billed directly for the costs associated with their treatment.
  2. The member contacts (as soon as reasonably possible) their personal Member Advisor from the healthcare community and advises them of the medical incident.
  3. The member receives and signs a Medical Information Release Form which authorizes the Advisor to serve as their advocate.
  4. Upon receipt of the itemized medical bills, the member forwards them to the HCS organization for processing and negotiation.
  5. The Member Advisor contacts the member’s medical provider(s) to negotiate the charges (as necessary) and notifies the HCS organization of the agreed costs.
  6. The expenses for the medical services received are then shared by the community and payment is sent directly to the member to pay their medical providers.

This is obviously an oversimplification of the process but I wanted to provide a starting place to understand how it works.

There are a few points to keep in mind as well as understanding the difference in terms used for HCS vs. health insurance.

  1. HCS is not insurance which means there is no transfer of risk from an individual or employer group to an insurance company via a contract and insurance premiums.
  2. There are “premiums” paid to an insurance company and there are “shares” contributed to participate in a HCS community.
  3. There are “claims” made to an insurance company when medical services are received and there are “medical needs” shared in a HCS community.

As described in the example above, another major characteristic is the ability of the administrator of the HCS community to negotiate the price the medical provider charges to the member for services received.  This is the main ingredient that has allowed the HCS community to enjoy its success for more than two decades.

When a provider is able to receive payment for services without having to deal with an insurance company they are almost always more than willing to reduce the amount initially charged.  It saves the provider money and they typically get paid much sooner than they do from an insurance company.

Again, there are a lot more details to be learned about HCS for your employees but it is at least worth your while to see how it might work for you and your team.  Call us right away to set up a time to discuss further at (888)884-4574 or email me at ansonm@dhbteam.com .

 

[1] Members of a health care sharing ministry – You are a member of a health care sharing ministry, which is an organization described in section 501(c)(3) whose members share a common set of ethical or religious beliefs and have shared medical expenses in accordance with those beliefs continuously since at least December 31, 1999. Source: IRS.gov