Ordinarily, insurances are designed for the risk mitigation of non-routine and costly events. However, the health insurance industry has discovered that they can make bucket-loads of money at your expense by “covering” affordable routine office-based and outpatient care but have you paying for it with copays and deductibles.
Medical savings plans are an alternative to traditional pricey and rule-based health insurance plans. They allow members to protect themselves against large or unexpected medical costs.
Medical cost sharing or healthcare sharing plans
While not technically an insurance, medical cost sharing plans have a framework similar to the way the health insurance industry operates. Although commonly religious-based to varying degrees, most are open to new members.
- They are often significantly cheaper than traditional health insurance plans.
- Monthly “shared” costs – like an insurance premium – can depend on plan details and can range from under $100 to $300-$500 for families (employers now spend on average about $20,000.00 to cover a family of five – often on junk health plans).
- Unshared amount – like a deductible – is the amount you have to pay before the health sharing plan kicks in. Typically the unshared amount/deductible is significantly less than that for traditional health insurance plans. A few hundred for an individual, about $1000 for a couple and a few hundred to a few thousand dollars for a family, depending on plan details.
- Members’ monthly payments (shares or premiums) are distributed to/shared with the members who have medical expenses (similar to risk -pooling for insurances).
- Enroll anytime – no special enrollment periods.
- You can choose any provider although some sharing plans may have physicians with pre-negotiated rates.
- No narrow “in-network” issues – see any doctor.
- No referral or authorizations needed.
- You provide your health sharing card as coverage. Try to get that established before seeing a doctor as well as their cash pay rates. Members may need to pay then submit the bill to the sharing plan and receive reimbursement some weeks later.
- Health sharing plans may not cover pre-existing conditions, wellness exams, mental health counseling, drug and alcohol related injuries, STDs, abortions, injuries from hazardous activities, expensive drugs and ambulance transportation.
- Membership is not affected by state of residence or employment status.
- Qualified adoption and funeral expenses may be covered.
- There may be limits beyond which cost sharing plans will not reimburse – health insurance plans often have similar rules.
- Health sharing plans are not binding contractual agreements and payments are not tax deductible.
- Medical cost sharing plans cannot be used with HSAs (Health Savings Accounts or HRAs (Health Reimbursement Arrangements).
- There are no guarantees of payment and no reserve funds.
- These healthcare sharing ministries can be audited to ensure financial stability.
Healthcare sharing vs health insurance plans
Overtime, health insurance plans have created endless barriers to both the access and delivery of healthcare – simply for profiteering. In the process, they have failed to deliver significant improvement in overall health.
Because 50 percent of the healthcare public consumes only 2 percent of healthcare dollars, not only are the odds of a catastrophic event low but many people are over insured and overpay.
Medical cost sharing programs can be an option for the uninsured, independent workers, part-time workers or gig workers – or, anyone wanting to lower healthcare costs. The goal here is to pay for your office-based care and only have a plan to cover costly or catastrophic healthcare events. This way you keep costs down and stay in control. There are several healthcare sharing/medical cost organizations in operation – search for them and check their details.
Written by HEALTHdrum