SACRAMENTO – California Attorney General Rob Bonta today issued a consumer alert warning Californians about sham health insurance plans offered by some healthcare sharing ministries (HSMs). These HSMs use misinformation to mislead consumers into enrolling under the guise of offering an affordable alternative to health insurance from the Covered California marketplace. However, unlike Covered California plans, healthcare sharing ministries are not obligated to cover preexisting conditions or guarantee coverage for medical costs or services. As a result, consumers have filed complaints with the Attorney General’s Office alleging that their healthcare sharing ministry plans have refused to cover treatments and pay their medical bills.
“Our office has received multiple complaints from devastated Californians who have been left in financial jeopardy with mounting medical bills after their healthcare sharing ministry plan failed to provide the reliable coverage they expected,” said Attorney General Bonta. “Before signing up for one of these plans, please do your research and consider applying instead for affordable, reliable coverage through Covered California.”
Prior to the passage of the Affordable Care Act (ACA), HSMs allowed people to pool their money with others who shared their religious beliefs in order to assist each other during times of medical crisis. After the ACA was passed, the Covered California health insurance marketplace was established, giving uninsured Californians access to quality, affordable, and ACA-compliant health insurance. Many companies also began to capitalize on the exemption of HSMs from many of the coverage mandates in the ACA by marketing them as a less-expensive alternative to ACA-compliant health insurance. However, unlike plans through the Covered California marketplace, HSMs do not guarantee payment for covered services and fail to cover essential health benefits, like birth control, prescriptions, preexisting conditions, and mental health care.
Many HSMs may be operating in California illegally because they do not meet the requirements of the healthcare ministry exception. Last year, the California Department of Insurance issued a cease and desist order to Aliera Healthcare, Inc. and Trinity Healthshare, Inc. (currently doing business as Sharity Ministries) for misleading California consumers into purchasing their products.
There are several important factors to consider before choosing a healthcare sharing ministry plan as opposed to a traditional health insurance plan:
- Healthcare sharing ministries use language that closely mimics traditional health insurance: Healthcare sharing ministry plans can be difficult to distinguish from traditional health insurance. Sometimes they even adopt tiered gold, silver, and bronze “plans” in their marketing materials. Many consumers often do not realize they have enrolled into a healthcare sharing ministry instead of traditional health insurance until the medical bill comes due. Carefully check the plan documents to ensure that you will actually receive coverage for your medical expenses.
- Healthcare sharing ministries are not required to cover or pay for your care: Federal law does not mandate that healthcare sharing ministries provide the ten essential health benefits required of ACA-compliant health plans, including coverage for preventive care, services for mental health and substance use disorders, and reproductive care. For example, unlike traditional health insurance, healthcare sharing ministries do not guarantee payment for birth control or abortions.
- Healthcare sharing ministries can choose not to cover your care based on preexisting conditions: In contrast, Covered California plans cover all of your health conditions regardless of whether they existed at the time you signed up for insurance.
- Beware of using healthcare sharing ministries as a means of saving money: Premiums to enroll with healthcare sharing ministries are generally cheaper than traditional health insurance, but those savings can come at a price. They are lower because they are not required to pay for your medical costs even though you have made all your monthly payments. Be wary of any personal finance blogs or healthcare navigation tools that steer you towards healthcare sharing ministries as a cost-saving measure.
A health insurance plan through Covered California not only provides the protections of the ACA, but monthly premiums are now lower than ever thanks to new and expanded financial help through the American Rescue Plan. Many Californians will be able to find a high-quality plan for $1 a month, or richer benefits for less than $100 per month. Consumers can enroll now and do not need to wait for open enrollment in the fall. Visit www.coveredca.com to see how much you may be able to save on your premiums and find the plan that works best for you and your family.
If you believe you have been the victim or target of suspicious marketing by a healthcare sharing ministry, please immediately file a complaint at www.oag.ca.gov/report.