When shopping for the right health insurance plan, many people are overwhelmed by the number of options at their disposal for finding the right plan to fit their coverage needs and budget. Many people are surprised to discover faith-based health insurance and are curious about the advantages and drawbacks of joining a health-sharing ministry. Read on to learn more about what faith-based health insurance is and to discover some of the advantages and drawbacks of enrolling.
What is Faith-Based Health Insurance?
Commonly referred to as health-sharing ministries, faith-based health insurance plans are offered through religious-based, non-profit charity organizations. Members of these plans contribute a fixed premium each month into a “community bucket” used to cover the cost of members’ medical care. Members submit requests for coverage by providing bills for doctor appointments or medical procedures. If approved, funds from the community bucket are used to pay the member’s medical expenses. As we see with traditional health insurance, faith-based health insurance plans typically have set deductibles that must be met before the health sharing ministry will provide coverage. Members may also be part of a PPO (preferred provider organization), which means they receive reduced rates when using in-network providers. For those providers outside of the PPO, members may be required to pay a higher portion or the entirety of the medical bill.
Advantages of Using Faith-Based Health Insurance
As an alternative to traditional health insurance programs, there are many advantages to enrolling in health-sharing ministries, including lower cost, plan flexibility, and being a part of a supportive community.
Many members who participate in health-sharing ministries cite significantly lower costs, including monthly contributions and deductibles, as one of the main advantages over traditional health insurance. While this is not “traditional” health insurance, the cost of medical care is shared by members of the ministry, making the overall individual impact much less. In fact, in many health-sharing ministries, the more affluent community members will volunteer to contribute larger amounts in order to allow those less fortunate to contribute less while still benefiting from the same access to medical care.
Because they are not regulated by the Affordable Care Act, health sharing ministries can be very flexible in how they’re structured, including in setting monthly premiums. Program administrators also have the freedom to offer other services not typically covered by traditional health insurance, like adoption and funeral services. In some cases, health sharing ministries do not operate within a PPO, which enables members to visit the provider of their choosing, without worrying about whether or not they are in-network.
Sense of Community
Health-sharing ministries are typically formed by a community from a specific religious denomination. The individuals participating and contributing to the community bucket are often also members within the same religious community. Beyond sharing the financial burden of medical care, health-sharing ministries are also often sources of emotional, spiritual, and even physical support. The ministries may encourage participation in online forums or even in-person events where members can interact and lend support, which creates a real sense of community.
Drawbacks of Faith-Based Health Insurance
Though there are several benefits of enrolling in health-sharing ministries, there are also many drawbacks to consider if you are thinking of opting for a faith-based health insurance program.
Not Regulated by Affordable Care Act (ACA)
While not being regulated by ACA may make faith-based insurance more cost-effective, it also enables health-sharing ministries to decline coverage, even after medical treatment has been provided. In fact, because of the structure of these types of insurance programs, “claims” are often submitted after the fact, and if the health sharing ministry does not approve the claim – perhaps due to moral reasons – the member would have to cover the expense on their own. Because they are not regulated by ACA, faith-based insurance programs are also not required to covered these ten essential benefits identified in ACA as the minimum standard that health insurance should cover.
Faith-Based Beliefs Guide Coverage
Most health-sharing ministries offer faith-based insurance programs that are rooted in the specific moral code of one religion. Sometimes, practitioners of a faith may agree with some, but not all, perspectives of religion, but their health insurance coverage will be based on all tenants of that religion. While you may feel a connection to the community in which the health-sharing ministry is grounded, your medical care may adhere to a moral code that you don’t fully agree with. As a result, any procedures, prescriptions, or medical care that falls outside this belief system will not be covered.
Requires Proof of Commitment to a Faith
Some health-sharing ministries require their members to demonstrate a strong commitment to the faith in which they are rooted. Often, these ministries require proof that a person is committed to the underlying religion in order to gain membership within the community and coverage for medical care. Others welcome members from other religions, but they still base their coverage on the underlying tenants of the faith that is the foundation for the health-sharing ministry.
Missing Tax Benefits
Because they are not regulated under ACA, faith-based health insurance programs cannot utilize health savings accounts, which allow contributors to set aside money to use for medical care before it is subjected to federal income tax. In addition, health-sharing ministries are not subsidized, which means participants, unlike those shopping in the marketplace, will not be granted price breaks based on their annual income.
AUI is an Insurance Broker You Can Trust
Not all insurance plans are what they’re cracked up to be, but you can trust the brokers at AUI to help guide you toward the right plan for your family and budget—one that includes doctors and hospitals you trust. Our licensed experts can also help you determine if you qualify for a subsidy in the federal marketplace. Contact us today to learn more!