The cost of insurance seems to be going up, along with the price of everything else, making it even harder for individuals and families to afford decent healthcare.
It’s worse if you’re not eligible for a tax credit because it means that your only options are to forego healthcare coverage or make do with an expensive monthly premium. Either way, you’re still required to pay tax by law.
However, did you know that there’s a third alternative? It’s known as health care sharing plans, and they’re often referred to as medical cost-sharing. It’s a way to save money on healthcare for you and your family.
Read on to find out more about health care sharing plans and why they’re a unique alternative to standard insurance coverage plans.
How Does Health Care Sharing Work?
As the name implies, members in a health care sharing plan split the medical costs.
This requires each member to pay a certain amount, sort of like a premium, in addition to an “annual unshared amount” that covers things like deductibles. These are basically there to cover your medical expenses until they reach the threshold to where the plan can then step in.
The unshared amount varies but it’s usually between $900 to $5,000 for families, $1,000 for couples, and $300 to $500 for individuals.
As you can see from this website, monthly premiums can vary in price and are based on the particular plan that you choose and its level of cover. Still, medical expenses are split between all the members of the plan.
Healthcare sharing plans are a viable alternative for people who:
- Are unable to afford traditional health insurance premiums
- Only require coverage for catastrophic events
- Missed open enrollment and are therefore unable to get coverage
- Don’t have insurance through a government program or their employer
- Don’t qualify for a tax credit due to their income
- Are in good health most of the time
Note that most health share plans are usually bought together by a religion. But, some of them don’t require you to declare your faith to their religion to join.
However, you must still live a healthy and moral lifestyle. This means following rules like abstaining from alcohol, drugs, or tobacco.
The Difference Between Health Care Sharing and Health Insurance
It’s important to not confuse healthcare sharing for instance. But the plans are recognized by the Affordable Care Act (ACA) as insurance.
This means that members get to enjoy affordable yet decent healthcare without paying a tax penalty for not having insurance.
Healthcare sharing is more affordable as the plans typically cost lower than traditional insurance premiums. However, the cover differences vary between the two options.
Instead of paying a massive deductible amount on lower premium insurance plans, members get to pay a low unshared amount annually instead. You get to decide your provider, your health sharing card can be utilized as proof of coverage, and there are no network requirements.
If you’re forced to pay out of pocket because a physician won’t accept your card you’ll be reimbursed by your plan.
With all that said, healthcare sharing plans don’t have to cover pre-existing conditions such as diabetes, cancer, and the like.
They may also decline membership or impose limits on coverage for any number of reasons. Healthcare sharing also doesn’t cover things like mental health counseling and wellness exams.