Even before the Affordable Care Act people were looking for alternatives to traditional health insurance. The biggest desire to change was insurance premiums that were getting out of control. Some also wanted to cut a middleman out of the equation.
The ACA provided a framework for millions of uninsured and uninsurable people to finally get quality health insurance coverage. Cost was still a problem for many as premiums climbed even faster than prior to the ACA.
One alternative people considered for the first time was health sharing. This is where people create a group and share medical costs over the entire group. Removing insurance company profits and people with unhealthy behaviors reduces overall medical costs within the group.
Most of the health sharing fell under the Christian ministries. Common names in the field are Liberty Healthshare and Medi-Share. Growing demand for health sharing also brought new entrants to the field.
Over three years ago I did the research and decided Liberty Healthshare would be the way for my family to manage medical expenses. This post/review is based on that experience and why I am moving back to traditional health insurance. (And some solutions if you are stuck with bills health sharing did not cover.)
The Most Important Consideration
Premiums/share amounts are a prime concern for people considering health insurance alternatives. But more important than the monthly cost is the payment of claims/sharing of medical bills. This is where Liberty Healthshare failed for me.
I made the leap on January 1, 2019 (3 ½ years ago from this writing on May 16, 2022). The share monthly amounts (what feels like a premium payment) were reasonable and my research said there were no real issues with medical health sharing at Liberty.
We had few medical bills in the beginning. What we had was paid per Liberty Heathshare’s program.
Then my daughter, Brooke, got very sick and required six surgeries over six months. It was bad. See link in Recommended Reading below for details on this family nightmare.
Brooke has her own health insurance due to a medical condition from birth. Her medical bills were covered.
Mrs. Accountant was not as lucky. COVID made it difficult for us to be with Brooke when she was
incarcerated in the the hospital. Only one person was allowed in for the entire stay. It was decided Mrs. Accountant would pull Brooke duty while my other daughter, Heather, and I manned the home fort.
The conditions were not ideal. The long hours (days) without being able to lie down to sleep took a toll. It eventually led to a painful back injury where her back was pressed into the chair the entire time.
The fix wasn’t serious. Mrs. Accountant had a short surgery to solve the problem. We were home by noon.
Liberty Healthshare approved the procedure. The hospital and doctors sent the bills to Liberty. And nothing happened.
Soon we were getting calls and letters. A call to Liberty informed us that Liberty had up to six months to share an expense.
Then a debt collector called! You could have putty knifed me off the ceiling. I pay my bills!
Another call to Liberty. Excuses. Another call to Liberty. And another call. And more excuses.
It was enough. The good news is I have the resources to pay $20,000 and change out of pocket without any real financial injury. (Thank God for financial independence! Another good reason to read AND study this blog. Valuable and real answers are within.)
Still, I paid around $6000 per year for my sharing amount. If I would have went uninsured or with medical sharing I would have had enough to pay 100% of my family medical bills from those share amounts. It is irritating to say the least.
Now you know why this blog stopped recommending medical sharing. What started out as a great alternative devolved into an unworkable solution.
As a tax professional I am well versed in researching complex topics. My original research showed some of the smaller medical sharing groups had issues. Getting in was the biggest negative for some people because they had to prove the were attending church. (Most of these organizations are “Christian” health sharing groups, remember.)
Liberty and Medi-share, the two I narrowed my list to, didn’t have any serious complaints. I promoted Medi-share on this blog and kept doing so for a few years, even after I discovered Liberty would be a better choice for my family situation.
My error was in not continuing non-stop research. In my defense, a guy does need to get other things done.
Once I smelled smoke I went back to researching and found things had changed a lot. It appears COVID had a serious negative affect on most of the medical sharing groups. Non-payment of shared expense complaints had become rampant. That is when I deleted the medical sharing option on this blog and feel medical sharing is no longer a viable medical insurance alternative.
Now the tough choice.
I can’t jump on the healthcare.gov website and pick up insurance. It is outside the enrollment period and I do not meet any of the special conditions to get in outside the enrollment period.
Here are my choices:
• Go without insurance until January 1st of next year.
• Keep Liberty Healthshare to the end of the year before enrolling in traditional health insurance, hoping for the best.
• Get temporary traditional medical insurance until year-end, moving to traditional medical insurance then.
I don’t know if it is the right choice, but I am going with the middle choice: keep Liberty until year-end and hope for the best.
My reasoning is this. I think Liberty really wants to pay the approved medical expenses. By staying, my hope is they will reimburse me for the $20,000 out-of-pocket (OOP) I paid.
The other reason is my OOP will be high with traditional health insurance anyway. What the healthcare.gov insurance policies give me is the option of buying an HSA qualified policy so I can sock more money away deductible and tax-free and using the tax code to get some tax advantages.
The health sharing experiment did not go as planned. I didn’t save any serious money as medical bills, coupled with COVID, created the perfect environment to suffer high expenses.
Note that my income level would have made it hard for me to get much Premium Tax Credit the past several years. That means OOP would still have been high. What I really lost was the ability to keep funding my HSA for four years.
My personal view is that medical insurance should be there to cover the big one. Liberty Healthshare has me concerned on that count. What if the bills were half a million? Yes, I could pay, but OUCH!
I look forward to starting HSA funding again. My attitude toward my HSA is to fund it and pay medical expenses OOP. The HSA will have a lot of suspended expenses to disperse tax-free to me at any time in the future most convenient to me.
Health insurance is a serious issue here in the U.S. Non-Americans have a hard time understanding the seriousness of the issue. Health insurance is expensive here. The Affordable Care Act (ACA) helped a bit, but not all that much. The best part of the ACA is that with more moving parts there is more tax planning to be done with serious financial benefits to be had, if planned well.
In conclusion, I do not recommend any health sharing program or group at this time. There are too many issues to consider it a viable alternative.
Money Lesson You Forgot to Teach Your Children: This is the story of how we nearly lost my daughter and the lessons we learned from her medical condition. This post also has links to other posts dealing with the medical issues in my family.
Never Pay the First Bill: And Other Ways to Fight the Health Care System and Win: If medical bills are interrupting your life this is a must-read book. Learn how to get a discount on medical bills and take back control of your life. Don’t get sick from the healthcare system!