Knowing the Alternatives
Medical bills are one of the leading causes of bankruptcy, making it imperative for many individuals to find savings on health insurance. As “plans” with jaw-dropping rates pop up, clients will come to their financial advisors asking about these great deals. These “deals” are offered by associations and are based on the hope of cost sharing within communities who share their “values” when approving the cost of medical care options. Unfortunately, because cost-sharing companies and associated health plans operate outside of the Affordable Care Act (ACA), patients are left to deal with companies that might take their money, deny coverage, and close their business.
Companies offering cost-sharing plans have been a particular cause of concern. As more people opt to join cost-sharing companies instead of buying primary insurance, there is a greater need for oversight. Retroactively holding these companies accountable is practically impossible because they are not “health insurance plans.” The loophole of not offering a health insurance plan attempts to protect these secondary supplements from regulation.
There are no definitive protections for the people who sell the plans as brokers or for purchasers. Attempts at regulating these offerings are fast in the making, as a 2017 Executive Order opened the market to associated health options. Complaints of denials have already started to pile up as customers do not understand their ability to appeal. States including Texas, Maryland, and Missouri have already taken swift action to stop these cost-sharing companies from selling plans in their states.
The author’s company, Medwise Insurance Advocacy, has negotiated with cost-sharing companies for more than 10 years. Plans with exceptions and unique clauses that could deny care were common prior to the ACA. Having to negotiate medical bills is nothing new in the industry. However, the volume of unscrupulous cost-sharing companies is getting hard to fight against and clients need to be on alert.
Disreputable companies are stopped when their license to do business in the state is revoked or prohibited. Regulating the professionals who directly sell them through advertising practices is also a stop-gap measure. Knowing what these companies are offering and their limitations helps clients understand the long-term financial burdens that may arise from not doing proper due diligence before signing up for “new” health options. Brokers who sell these coverage options could hurt long-term customer relations and be caught in compromising situations, as Aliera and similar companies are no longer licensed to do business in the state.
A recent case the author was involved with involved a standard medically necessary procedure that was denied by a faith-based cost-sharing association. The patient was using the “plan” as the primary insurance; when medical bills became costly, however, payment for care was denied. A clear cause for concern in holding the company accountable was the lack of jurisdictional oversight and the contracts signed between the client and company. The company was registered in one state, operating out of another state, and then being sold and used in yet another state.
These companies regulate themselves, and when a person receives a denial for care the recourse is to appeal to the company directly. States cannot force coverage, contracts are generally upheld, and mediation/arbitration is usually used to settle issues. It is imperative for consumers to read the fine print to know the details of each membership. Each company offer comes with its own unique set of stipulations for care.
Examples of cost-sharing companies include Christian Healthcare Ministries, Altura Health Share, Christian Healthcare Sharing, Aliera Healthcare, Medi-Share, OneShare Health, MEC HP3, Agentra, and Samaritan Ministries. Some have revenues in the millions and others have quickly closed. For example, Christian Healthcare Ministries reported more than $444 million in revenue on their 2018 taxes. Trinity and Aliera, however, is a single company that was started in Atlanta; already, its business license has been revoked in some states. Liberty HealthShare has been served 155 complaints with the Better Business Bureau, and Cathedral is no longer in business.
When patients rely on cost-sharing companies and associated health plans, they quickly realize that coverage is limited; it becomes the patient’s responsibility to negotiate with the provider. Providers are now asking for a personal credit card to be on file because they know that being paid by those companies is unlikely. Once a bill is paid, especially by an authorized third-party credit line, negotiating bills with providers to lower costs can be impossible. CPA financial planners can help by proactively discussing health plans and cost-sharing plans with clients and reviewing their benefits and limitations.