HealthShares have increasingly become a popular alternative to traditional health insurance, offering a unique model for managing healthcare costs. However, their similarities to insurance can often lead to confusion between the two. This post aims to clarify the key differences between HealthShares and insurance, offering an overview of each model’s characteristics, benefits, and limitations.
HealthShares are not insurance
HealthShares operate similarly to traditional insurance, with members paying a monthly fee up to a fixed amount before their HealthShare helps with medical bills. This model might give the impression of insurance, leading naturally to the question, “do HealthShares count as insurance?” The simple answer is “no,” but this response doesn’t fully address the complexities of the topic.
What is health insurance?
Health insurance, unlike HealthShares, is regulated by the federal government. This type of national standardization prevents insurance companies and employers from offering sub-standard plans to customers. The regulations also prevent insurance companies from refusing to pay expensive bills, or bills related to expensive health conditions, such as diabetes. Subscribers to traditional insurance have legal recourse if their insurance fails to pay a bill. They can also expect coverage for many pre-existing conditions and long-term diagnoses, therapies, and treatments. These laws ensure that traditional health insurance provides more comprehensive care than most HealthShares.
On the other hand, such comprehensive care is expensive. Consequently, some members of traditional insurance might find themselves paying for care they don’t need, or never use. This is where HealthShares come into play, offering an alternative way of managing healthcare costs.
What is health sharing?
HealthShares operate in a way that might look similar to health insurance; members pay a monthly fee, meet a set amount similar to a deductible, and then the organization helps pay eligible bills in a process called “sharing.” However, as HealthShares aren’t federally regulated, they have the discretion to determine which bills are eligible. Membership guidelines for HealthShares tend to be highly detailed and lengthy for this reason, outlining which costs are shareable and which are not.
By restricting which bills are shareable, HealthShares manage to lower the cost of care. The seemingly lower cost of joining a HealthShare compared to insurance can be attributed to the fact that HealthShares do not cover the same wide range of conditions and needs as traditional insurance does, thus reducing charges for members.
Some common examples of unshareable bills, per the guidelines of several different HealthShares:
- Care related to substance abuse
- Psychiatric care
- Abortions
- Medical bills related to dangerous or thrill-seeking activities
- Care related to pre-existing conditions, until the member has passed a waiting period
- Maintenance medications
- Care that goes against an organization’s religious convictions
Protection for HealthShare members
Membership in a HealthShare does not mean the absence of any protection. Members are paying for a service, and the HealthShare must provide that service. If a HealthShare member has a bill that should be paid per the member guidelines, but the company refuses, the member can report the HealthShare to consumer protection authorities in their state.
Understanding membership guidelines
Selecting a HealthShare necessitates thorough scrutiny of the member guidelines. Prospective members should revisit the guidelines multiple times, noting what types of costs the organization will and will not consider eligible for payment. If a prospective member has a pre-existing condition and needs regular treatment for it, saving some money every month with a lower membership fee may not be worth having to pay out of pocket for doctor’s visits and needed medications.
Understanding the fundamental differences between HealthShares and traditional health insurance is crucial when deciding on a healthcare cost management solution. While HealthShares can provide a cost-effective alternative, they do not offer the same level of coverage or regulatory protection as insurance. It is important to review membership guidelines thoroughly and consider personal health needs before making a decision.
