Alternative to Health Insurance Grows by 477 Percent Under ACA

Published May 16, 2017

Paid membership in a faith-based health care cost-sharing organization has increased by 477 percent since the Affordable Care Act (ACA) became law.

More than 225,000 individuals from 69,000 households write monthly checks to help pay the medical bills of fellow members of Samaritan Ministries International (SMI), the organization announced in a press release on April 25. SMI had fewer than 39,000 members in about 14,000 households on January 1, 2010, two months before ACA took effect, according to records obtained by Health Care News.

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Member households pay for all medical needs costing less than $300. For needs costing more than $300, households pay the initial $300 and receive monetary gifts for the remaining amount, according to a February 2017 update of the SMI sharing guidelines. Fellow members reimburse them for the rest by paying monthly “shares,” in the form of personal checks, sometimes accompanied by encouraging notes and written prayers.

One- and two-member households pay a monthly share of $220 per person. Families with three or more members pay $495 per month, except for single-parent households, which pay $305 per month.

Shares cost less than ACA premiums, and members typically reimburse one another for qualifying medical expenses in greater amounts than Obamacare insurers reimburse customers. For a 30-year-old nonsmoker, the average unsubsidized monthly premium is $464 for an Obamacare Gold plan in 2017 with a $1,197 deductible and $4,889 out-of-pocket maximum annual costs.

Anthony Hopp, SMI’s vice president of external affairs, says the organization offers members a community interested in helping meet one another’s medical needs.

“At Samaritan Ministries, we have a quarter-million people practicing authentic biblical community by loving each other in a very practical way,” Hopp said during a press conference at the Evangelical Press Association conference on April 10.

Responsible Spending

Twila Brase, president and co-founder of the Citizens’ Council for Health Freedom and an SMI member, says members tend to spend one another’s resources more responsibly than customers insured by a faceless company.

“There is no ‘big pocket’ to draw from,” Brase said. “The dollars are coming from like-minded members around the country. The dollars are essentially coming from your neighbors, not a big corporation in a fancy building.”

The exposure of members to their own and others’ medical bills prompts them to spend carefully.

“Samaritan Ministries uses direct payment between patients and doctors without third-party interference,” Brase said. “Samaritan’s direct interaction between members enhances cost-sensitivity for treatment decisions because individuals are paying each other’s medical bills, and that direct payment comes in the form of a personal check from a stranger.”

Open Provider Market

As self-pay patients reimbursed after the fact, members negotiate health care purchases with providers directly, Brase says.

“Samaritan Ministries is encouraging members to leave the insurance mindset behind by gathering and sharing personal stories of how members brought medical treatment prices down by looking at useful websites, asking doctors and hospitals directly for prices, disclosing their uninsured status, and negotiating for a cash price,” Brase said.

Hopp says members typically negotiate discounts not offered to patients paying with insurance.

“Many providers offer discounts to cash-paying patients, Hopp told Health Care News. “Costs for medical services can vary greatly among medical providers, and the initial charges for a cash patient are often higher than what is usual and customary for the service,”.

Members shop around for their medical providers of choice in an open market, Hopp says.

“Members of Samaritan Ministries are not restricted to any networks and are free to choose providers that offer the best price and quality for their services,” Hopp said.

Exempt from Obamacare

ACA exempts members of health care sharing ministries (HCSMs), such as SMI, from the individual mandate and tax penalty imposed on individuals lacking health insurance.

Dr. Jane Orient, executive director of the Association of American Physicians and Surgeons and an SMI member, says HCSMs offer a free-market alternative to filing insurance claims for routine care.

“Membership in an HCSM like SMI is absolutely more conducive to a free-market health care system, especially because it is virtually impossible under Obamacare to buy real insurance, as opposed to a prepaid ‘health plan,'” Orient said.

The exemption leaves HCSM members freer than individuals subject to the Obamacare mandate and fine, Orient says.

“The freedom to decline to buy a product is a crucial aspect of a free market,” Orient said.

Matthew Bolduc ([email protected]) writes from Washington, DC.

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