Myths and Misconceptions about Health Sharing Plans

With traditional health insurance premiums becoming more and more unaffordable for millions of Americans, health sharing plans are enjoying a surge in popularity.

These lower-cost, more affordable alternatives to traditional health insurance products offer welcome relief for hundreds of thousands of households nationwide who’ve been left out of “Obamacare” ACA subsidies.

But they are not well understood in the financial media, and even among financial and insurance advisors.

As a result, there are a number of myths and misconceptions surrounding health sharing ministries and the plans they offer.

This blog will address some of the most common, and provide accurate information about health sharing plans, how they work, and their advantages and disadvantages. 

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1. Health Sharing Plans Lack Regulation

Misconception: Health sharing plans should be avoided because they’re not regulated.

Reality: It’s true that health sharing plans don’t normally fall under the regulatory purview of state insurance commissioners. However, that doesn’t mean health sharing plan members go without protection.

Here’s why: health sharing plans still operate under every state’s general contract law.

Every contributing health share member has an enforceable contract, based on the plan’s sharing guidelines and other documents.

When you join a health sharing plan, you will (digitally, usually) sign an agreement that specifies your responsibilities as well as theirs.

It expressly lists what procedures and expenses are shareable and what costs are not shareable, and specifies the procedures by which that cost sharing occurs.

You can feel confident that if necessary, you’ll have a legal recourse to make sure the contract is upheld as promised.

That said, health sharing plans don’t have the same financial oversight from state insurance commissioners as traditional health insurance carriers do.

Health share organizations also aren’t part of state level ‘guaranty’ programs that step in to pay claims when insurance carriers become insolvent.

Health share members therefore have a little more responsibility for due diligence than most ordinary insurance customers. You should pay attention to the overall size and sharing capacity of any health sharing plan you are considering.

2. Minimum Essential Coverage is a Necessity

Misconception: Health sharing plans aren’t required to have Minimum Essential Coverage (MEC), and that’s a problem.

Reality: Insurance laws and regulations often drive up costs by forcing traditional insurance carriers to pay for benefits most people don’t want or need.

Insurance companies have to take all comers. Even if they make very poor lifestyle choices that make them very poor health risks.

These people drive up costs for everyone else in the risk pool.

But if you know you don’t use illegal or addictive  drugs, you don’t drink to excess, you don’t struggle with mental illness, and you’ll never get pregnant, you don’t need to buy a plan with all these expensive extra benefits like residential alcohol or drug addiction treatment psychiatric treatment benefits, and maternity/NICU benefits.

Why pay extra for them?

Health sharing plans give health-conscious and responsible people a way to opt out of the generally poor risk pools that traditional insurance companies are forced to serve. And you can opt out of the crazy premium costs that traditional insurance carriers have to pass on to their customers in order to stay financially viable.

3. You Can’t Contribute to an HSA if You Join a Health Sharing Plan 

Misconception: Joining a health sharing plan means you can’t contribute to a Health Savings Account (HSA).

Reality: There actually is a way to contribute to an HSA while being a part of a health sharing plan, thanks to innovative solutions like the HSA MEC plan offered by HSA for America. 

HSA MEC is a limited benefit health plan, designed specifically to include the minimum essential coverages (MEC) required by the Affordable Care Act (ACA). It’s specifically designed to qualify as a High Deductible Health Plan (HDHP).

So once you enroll in HSA MEC, and meet certain other requirements, you’re eligible to contribute to an HSA.

Note: At this time, HSA MEC is only available to business owners, independent contractors, and self-employed individuals.

However, the massive tax benefits of HSAs mean it may well be worthwhile to start a business or side hustle of your own, just so you can qualify for HSA MEC!

Contact a Personal Benefits Manager if you’d like to learn more!

4. Health Insurance is More Economical

Misconception: Many people assume that a traditional health insurance plan will cost less than a health sharing plan.

Reality: In many cases, health sharing plans are much more affordable than traditional health insurance.

For those who are in good health, with no significant pre-existing conditions, and who don’t qualify for a significant ACA subsidy to help them pay health insurance premiums, health sharing routinely saves 40 to 50% off the cost of an unsubsidized traditional health insurance policy.

If you are already committed to living a healthy lifestyle, health sharing plans can actually help you and your family save thousands of dollars per year.

5. Health Sharing Plans Can’t Provide for Major Medical Needs

Misconception: Health sharing plans don’t have sufficient resources to provide for significant medical events.

Reality: Health sharing plans are structured to pool resources from a large member base.

This provides a significant financial reserve to help share the costs of any major medical issues a member may face.

For example, Medi-Share has over 250,000 members and has shared more than $1.7 billion dollars in medical bills. You can feel confident your needs will be met when you enroll in the right plan.

It is true that some smaller or poorly-run health sharing ministries have had issues sharing costs. That is also true of some traditional health insurance companies as well.  HSA for America does not represent carriers or health share organizations with known liquidity or solvency problems.

6. Medical Facilities Only Treat Patients with Health Insurance

Misconception: Medical facilities will deny treatment to patients without traditional health insurance.

Reality: Most doctors and hospitals recognize health sharing plans and work with them just as they do traditional insurance companies.

In fact, some health care providers prefer dealing with health sharing plans due to their straightforward billing processes and prompt payment systems. Plus, health sharing plans can negotiate a cash price for services, which saves even more money for you, the consumer!

7. Pre-existing Conditions are Not Allowed

Misconception: Health sharing plans don’t accept pre-existing conditions.

Reality: Sharing for pre-existing conditions varies among plans, and often there is an initial waiting period before medical expenses associated with a pre-existing condition will be eligible.

Some pre-existing conditions may be immediately shareable if they are controlled with medication, or if you can show evidence that they don’t present a current health risk.

In most cases, costs to treat pre-existing conditions become fully shareable after the waiting period. There’s also often a sliding schedule, where more and more costs become shareable each year over several years, and eventually become fully shareable.

Each health sharing ministry has a different policy when it comes to pre-existing conditions.
Connect with a Personal Benefits Manager to compare plans and find the best option for your situation.

8. Health Sharing is Only for the Healthy

Misconception: There’s a perception that health sharing plans are only good for people in perfect health.

Reality: Health sharing plans are designed to support a diverse range of members, including those with ongoing health care needs.

While there are some restrictions on sharing for pre-existing conditions in the first few years of membership, you don’t need to be in picture-perfect health to join a health sharing plan and enjoy meaningful sharing protection.

While many plans emphasize preventive care and healthy living, they are practical, and provide ongoing support for whatever medical situations their members may face.

Learn More: How Health Share Plans Pay for Surgery

9. The Services are Limited

Misconception: Health sharing plans are restrictive, and limit the services members can access.

Reality: Health sharing plans provide a wide array of healthcare services that help members with a variety of medical needs.

Many plans provide for a range of services, such as preventive care, mental health services, and surgical procedures. They may even provide 24-7 telehealth services!

Plus, many health sharing programs continue to evolve and expand their services to adapt to the emerging needs of their members. 

10. Health Sharing is only for Christians.

Misconception: You need to be a churchgoing Christian to join a health sharing plan.

Reality: Some health share plans are directly affiliated with specific religious denominations, and have a requirement that members attend services regularly.

But many others are non-denominational, and still others are completely secular and open to all, regardless of religious background, affiliation, or practice.

No matter what your religious background or beliefs, there is a great health sharing plan available that aligns with your values.

Learn More: Comparing Health Share Statements of Faith

11. You Can’t Choose Your Doctor

Misconception: Health sharing plans have a limited network of healthcare providers.

Reality: Unlike the HMOs, EPOs, and PPOs that dominate the Affordable Care Act marketplaces, health share members are not restricted to a narrow list of specific providers or services.

Most plans let members use their health sharing benefits with any doctor or hospital, and even provide services abroad.

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The Bottom Line

After debunking these myths, it should be clear that health sharing plans are a wonderful alternative to traditional health insurance programs.

They are an affordable option that allow members to customize their own health care. The flexibility of these programs make them a practical choice for many families.

Reach out to a Personal Benefits Manager to explore your options, and find a plan that fits all  your needs.

Additional Reading: Best Healthshare Plans Comparison Guide 2024 | How Much Money Can Healthsharing Save? | Why You Should Use Independent Doctors