HEALTH CARE SHARING MINISTRIES (HCSM)

Health Care Sharing Ministries (“HCSMs”) are organizations in which members often share a common set of religious or ethical beliefs and agree to make payments to, or share, the medical expenses of other members. HCSMs operate either by matching paying members with those who need funds for medical expenses or “sharing” health costs on a voluntary basis. HCSMs may present coverage in ways that look and feel similar to health insurance, but claim to offer an “alternative” to health insurance. HCSMs often cost less than health insurance. However, before you sign consumers up for an HCSM, there are some things you should know:

• HCSMs don’t guarantee payment of claims. That means that while they may share funds with members who have health needs, they are not legally required to do so.

• HCSMs usually cap what they will pay. This means that even if an HCSM will cover your treatment, the HCSM may stop paying once the treatment costs exceed a certain dollar amount, leaving you with the bill.

• Most HCSMs claim they are not insurance and are therefore exempt from state law. This is untrue. To the extent HCSMs are transacting insurance they fall under the jurisdiction of the Department of Insurance and must have a valid license in order to do business in California. Whether a particular medical service will be covered is completely up to the Sharing Ministry and what is covered can change at any time without prior notice. Most HCSMs do not comply with the consumer protections of the federal Affordable Care Act (ACA), like covering treatments for pre-existing conditions or capping out-of-pocket costs. If care or treatment is not covered, insureds cannot appeal for an independent medical review overseen by the State of California

• HCSMs usually don't have provider networks, so members may be charged full price by doctors and hospitals, rather than the lower negotiated rates charged to consumers who have insurance coverage.

• HCSMs may provide value to some, but they pose a risk to others because they often provide limited benefits.

• Under certain circumstances membership in a health care sharing ministry exempts members from the state individual health insurance mandate, but only if the ministry meets a specific a definition found in the Affordable Care Act (ACA). Many HCSMs do NOT meet this definition and therefore membership does not exempt individuals from the state or federal mandate.