HealthShares have been growing slowly for the last two decades, but there is a notable shift underway in 2024. A growing number of businesses are exploring alternatives to traditional health insurance due to the financial pressure of escalating premiums costs on not only their budgets, but their employees’ as well. A recent report from the International Foundation of Employee Benefits Plans indicates that the median projected increase in costs for employer-sponsored health plans is around 7%, a factor likely contributing to a pivot away from insurance toward HealthShares—a more affordable and flexible option for employers and employees alike.
For those unfamiliar, a HealthShare is a company that facilitates voluntary medical cost sharing within a members-only community. Members make monthly payments that are typically pooled and then distributed to other members for approved medical expenses. In this way, each member of the community contributes to the support of other members.
But this growing shift in preference toward health sharing is not merely a matter of cost savings—it is a broad reevaluation of how healthcare can be managed. As HealthShare organizations continue to challenge the status quo of healthcare, more and more employers are finding them to be a refreshing non-insurance answer to health benefits for their teams.
The economic incentives for businesses with HealthShares
Simply put, the largest hurdle for small- and medium-sized businesses regarding health insurance and benefits for employees is the cost. Most of this can be boiled down to two cost concerns: first, that premiums are too high for employees; and second, their business cannot afford to contribute to employees’ health plans enough to make them tenable for employees. According to the Kaiser Foundation, these are valid concerns. In their 2022 Benefits Survey, they reported that the average annual premium for employer-sponsored health insurance rose to $22,463 for family coverage.
HealthShares, by contrast, offer much more affordable rates, though specific savings can vary based on the organization. Businesses like Gary’s HVAC company, which transitioned to HealthShare membership in 2022, tend to report significant savings, and with the monthly cost being more affordable, a higher participation rate among employees.
HealthShare customization for employee needs
As companies grow and change, so do their healthcare requirements. HealthShares are recognized for their flexibility, with the more prominent and preferable organizations offering a range of customizable options to suit diverse needs and budgets. This can include varying levels of member responsibility amounts, optional preventive care sharing, and add-on benefits.
For some HealthShare organizations, this flexibility extends to the employer as well. As more businesses work with HealthShare organizations, their growth is accommodated by the ability to modify options as their workforce expands or as the needs of their employees change. A survey by the Society for Human Resource Management found that 70% of employers consider this type of flexibility and customization in benefits to be important.
Addressing businesses’ HealthShare concerns
In addressing common concerns about HealthShares, businesses often weigh potential drawbacks, such as limited sharing for pre-existing conditions or the absence of a central regulatory authority found in traditional insurance. While these are legitimate concerns for those unfamiliar with a smaller and still-evolving industry, there are answers. Many companies mitigate these risks and challenges by combining HealthShares with supplemental policies or educating employees on program specifics to help better inform their decision making. There are even third-party benefits administrators that specialize in building benefits packages that include HealthShare membership as a main pillar of the package.
Beyond cost sharing: added value for members
HealthShares are not just about sharing healthcare costs; they are platforms for building communities that value health and wellness. Many HealthShare organizations emphasize the importance of a health-conscious lifestyle (with many, but not all, doing so in religious terms), encouraging members to be proactive with their health and habits. A study by the American Journal of Managed Care reported that community-based programs focusing on lifestyle changes resulted in a significant reduction in healthcare costs, with some programs reporting a decrease of up to 30% in hospital admissions among participating members. In this way, HealthShare membership is not only more affordable than insurance—it is more efficient.
By offering more than just financial assistance in the even of major medical needs, HealthShares present a thorough and effective approach to healthcare. As opposed to an adversarial role, which many view health insurance to play, HealthShares have made themselves partners in health rather than mere providers (or deniers) of financial assistance.
This year may very well see the largest pivot of businesses toward HealthShares yet. This is more than just a fad or trend; it is a reflection of the collective challenge to the status quo of health insurance and reactive healthcare as a whole. Balancing affordability with a community-drive approach, HealthShares offer a dynamic and supportive experience that is resonating with more and more businesses and their employees. HealthShares not only a financially prudent choice, but also one that encourages healthy habits and lifestyle, lightening the burden for all.
