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Medical Cost Sharing Plans

Most Americans agree that health care costs are spiraling out of control.  The Affordable Care Act plan monthly premiums are continuing to rise with no end in sight.  There is a real need for alternative health insurance choices.  Once such alternative option is a Medical Cost Sharing Plan.

senior studying Medicare Advantage plans.
Medical cost sharing plans are one of the fastest-growing healthcare options in the nation.  They are an effective and affordable option for a growing number of American families.

So What Are Medical Cost Sharing Plans?

Medical cost sharing plans, also referred to as healthcare sharing plans, healthcare sharing ministries, or faith based health plans, are designed to perform the same basic function that a traditional health insurance plan would: Provide a means to pay for the costs associated with unexpected medical bills.

Medical cost sharing plans participants are part of a network whose members all pay a monthly fee into the plan.  The resulting fund is used to manage medical claims according to the company guidelines, and the plan style chosen by the member.  Again, it looks and sounds very much like health insurance - but it's not - not in the legal sense anyway.  Because medical cost sharing plans are not insurance plans, how the plans are structured can be entirely different than what is offered by plans within the Affordable Care Act umbrella.  This distinction is often reflected in plan flexibility and monthly costs.

Good to know:  Understand your budget.  The average consumer spends around 5% of their annual income on health insurance premiums.  Keep in mind, this doesn't take into account other expenses, such as deductibles or out of pocket costs.  If the health care plan you are considering is priced significantly higher than 5% of your income, unless you're expecting an income increase in the very near future, you should consider choosing another plan.
Benefits Of Medical Cost Sharing Plans

Medical cost sharing plans can provide several benefits to you and your family.  It's important to understand these benefits in order to make a informed decision about your family's healthcare plan.

Lower Monthly Payments

Let's start with the most significant advantage.  For a variety of reasons, medical cost sharing plans monthly costs tend to be lower than the typical monthly premium of traditional health insurance plans.

Lower Deductibles

Medical cost sharing plans tend to offer plan choice that feature lower "deductibles" than those found in traditional health insurance plans.  (FYI:  Because cost sharing plans are not insurance plans, the term "deductible" is not used.  Terms like "annual portion", or "shared cost responsibility" are used instead.)

No Enrollment Period

One reason why many families opt for medical cost sharing plans is because they offer any-time enrollment.  This means that you don't need to wait for an open enrollment period to gain health insurance.  Instead, individuals can simply sign up for the plan they wish and begin their coverage.  So, in some cases consumers purchasing a medical cost sharing plan will receive quicker access to healthcare.

Also, many consumers like knowing that they will never have to worry about missing an open enrollment period.  The convenience of simply choosing a plan and going with it has helped grow healthcare sharing plans into the phenomena they are today.

Good to know:  Ask for samples.  Your doctor's cupboards are full of free drug samples, courtesy of the pharmaceutical industry.  If your child is getting shots, ask for a trial size pain reliever in case he needs it later.  If you're trying a new antibiotic or rash cream, your physician may even have enough samples to cover your course of treatment.  Also, check out the drug company's Web site, which sometimes offers coupons or free samples.
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One big selling point of an ACA backed plan is you cannot be declined coverage due to health issues.  Medical cost sharing plan companies can choose to decline coverage to any individual due to medical issues or history.  Also, certain ACA plan benefits and protections are mandated by law.  Some benefits, like maternity, for example, may be very important to you.  Your faith-based plan may not offer it.

There are also lifetime maximum benefit limitations with most any faith-based health plan.  ACA plans have no such limitation.

For these reasons, medical cost sharing plans are not the perfect alternative healthcare plan solution for everyone.  Whether or not a cost sharing plan makes good sense, depends upon your medical and financial circumstance.  Be certain to understand benefits and limitations thoroughly, before purchasing any faith-based , or traditional health insurance plan.

For more information on Faith-Based / medical cost sharing ministries, please contact us directly.

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