Understanding the Vocabulary of Medical Cost Sharing

HealthShare terms and their health insurance counterparts

 

If you read through some HealthShare websites or member guidelines, you will probably notice that HealthShares use words like need and share in unique ways. These unfamiliar terms might cause some confusion—particularly if you are expecting to see terms used by health insurance companies.

Why don’t HealthShares use the same terms as insurance companies?

HealthShares are not under the same legal obligations as traditional insurance, so some terms simply would not be appropriate for them to use. Any reputable HealthShare will make it clear that they are not an insurance company—they are an alternative solution to healthcare needs.

Since HealthShares operate differently than your health insurance company, they want to set themselves apart. Different vocabulary is one of the primary ways your HealthShare can accomplish this.

Still, the words we are used to—words that explain concepts in the insurance industry—might seem like they should be transferrable to HealthShares. After all, HealthShares are a way to pay for your medical bills just like insurance, right? Unfortunately, it’s a bit more complicated than that.

Let’s take a look at some of the main health insurance terms that you are probably most familiar with (from years of hearing and seeing them) and see where HealthShare vocabulary overlaps with or diverges from similar concepts.

Cover vs. Share

The insurance term cover, or coverage, is often used in casual conversation about HealthShares. This is understandable since we are quite comfortable with what the word cover means. But, when discussing HealthShares, this word can be very misleading.

Most HealthShares make it clear that they are not insurance. As such, they are not legally required to cover anything. Instead, your HealthShare facilitates sharing among members according to a set of agreed-upon standards. For this reason, HealthShares use the term share to describe what happens with member medical costs.

With all of that said, cover and share have the same idea: the portion of your healthcare costs that the group pays for—the part you don’t have to pay.

If the details of your membership guidelines or your health insurance plan list something as covered or shareable it generally means that the eligible item in question will be cared for financially. In an insurance plan, the item is covered by your selected plan provider, in a HealthShare the cost may be shared by the membership community.

Claim vs. Need

Insurance companies use the word claim to describe your request to have a bill covered. Using the word claim implies that you have a right to the coverage, and that the company must pay for it if the request fits your summary of benefits and coverage.

HealthShares use the term need to describe an illness or injury resulting in expenses that you would like assistance with. The word need implies that you may have something you want help with, but it does not imply that the company is obligated to care for it.

Of course, if your need falls within the member guidelines, and you are meeting membership requirements, your need will likely be cared for.

Related expressions are “submitting a claim” and “submitting a need” (or “need request”). Submitting a claim on your insurance policy may happen automatically—done on your behalf by the provider after they collect your insurance information. With a need, you will likely submit documentation yourself.

With HealthShares, some providers may forward bills directly to the cost sharing organization, or you may pay up front and submit a need as a reimbursement request. In any event, you are likely to be more involved in the process with a HealthShare than you would be with a typical insurance claim.

Deductible vs. Member Responsibility

Whether you have traditional health insurance or you join a HealthShare ministry, you will commit to pay a certain dollar amount before they will pay toward your bills. For health insurance, this amount is called a deductible, for a HealthShare it is called member responsibility.

Your HealthShare may have a specific term for member responsibility like Annual Unshareable Amount, Personal Responsibility, or Initial Unshareable Amount. Member responsibility may be an annual or per need amount whereas a standard insurance deductible is an annual amount.

A typical health insurance policy will have an out-of-pocket maximum, a limit on how much the insured will pay toward their medical care in a year. A HealthShare may use the same term (out-of-pocket maximum) or something similar like maximum member responsibility.

Since your HealthShare has specific guidelines about what is and is not eligible for sharing, an out-of-pocket maximum will not be a hard-and-fast limit on what you will spend on medical care; rather, it is a limit to how much you will spend on shareable expenses that qualify as a need.

What is eligible for cost sharing and what is eligible for insurance coverage may differ greatly. Either way, out-of-pocket refers to a maximum amount that you will pay in a 12-month period on eligible items.

Another minor point to look for in relation to member responsibility and out-of-pocket maximums, is whether or not your HealthShare uses a coshare system. A coshare is similar to the idea of an insurance copay and coinsurance. If your HealthShare has a coshare structure, you may be responsible for some kind of initial amount or visit fee plus a portion of each of your needs.

Monthly Premium vs. Monthly Contribution

To be served by a health insurance company or a HealthShare ministry you must put something into it. You will pay something each month to keep your insurance plan, and you will pay something every month to keep a HealthShare membership active.

Your insurance policy will have a monthly premium, a payment that you make directly or through a paycheck deduction. To maintain your HealthShare membership you will submit a monthly contribution. Your monthly HealthShare payment is called that because it is voluntary, there is no contract that you commit to.

If you decide that you don’t want to be a HealthShare member anymore, you can stop contributing. Of course, if you do so, you will forfeit any membership privileges—like sharing your medical bills with the community. With health insurance, you generally commit to a term of service, and thus commit to paying a monthly premium amount until the next enrollment period.

Summary of Benefits and Coverage vs. Membership Guidelines

Your health insurance will provide a summary of benefits and coverage that details what is and is not covered by your selected (or workplace-provided) plan. If you join a HealthShare, the membership guidelines will do something similar.

A HealthShare’s membership guidelines will provide details about what is and is not eligible for sharing with the community. It will also detail behavior that may be deemed unacceptable for members—or at least behavior that, if resulting in a medical need, will not be considered for sharing.

We are here to help

It’s natural to lean on terms that we have heard for years and are much more familiar with—terms like coverage and claim. But, if you have decided to make HealthShare membership part of your healthcare strategy, familiarizing yourself with HealthShare-specific vocabulary can help you better understand how the two approaches work.

We understand that this is easier said than done, whether you are new to the HealthShare community or you have been a member for some time. To help, there is a handy reference chart below with the main terms from this post. In the chart you will find the HealthShare term, its most closely related health insurance term, and a simple explanation of how they are related.

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