Why aren't more using a Christian Plan?

[Sunset]

With these Christian plans I see a really big opportunity for someone to "help themselves" to the $$$. Someday we may hear of the embezzlement of $$ as how would anyone ever know what is done by the insiders ?

What happens when a person gets a serious illness, can they be suddenly accused of being not Christian enough to qualify, how could you possibly fight that while being sick, sort of like being accused of being a witch in Salem, no real defense.

 

[samclem]

General comment: It will be helpful if this discussion concentrates on the health care attributes of these still novel plans and avoids comments about religion, sin, etc. Such comments threaten to cause a useful discussion to become acrimonious for no good reason.

 

[flintnational]

Does anyone know how these plans handle fee and Rx negotiations? One of the items you purchase with an insured health plan is negotiated (hopefully discounted) fee schedules.

 

[MichaelB]

Those wanting to know how this program works should visit the website and read the info and brochures. Here’s one example https://www.chministries.org/programs.aspx

From what I can tell, the coverage is related to “incidents”, the amounts reimbursed are based on typical insurer reimbursement rates, there are upside limits, pharmacy and lab are included. This looks in some ways like short term heath insurance. Not good for long term chronic illnesses, and also not good for expensive out of network providers, but for simpler day to day needs it seems like a fair option.

 

[ncbill]

Does anyone know how these plans handle fee and Rx negotiations? One of the items you purchase with an insured health plan is negotiated (hopefully discounted) fee schedules.

That's another thing.

Many health ministry sharing plans put the onus on you to negotiate cash discounts with the healthcare provider.

Only a few will handle the above just like a regular insurer.

 

[copyright1997reloaded]

So far, so good. Is the entity legally obligated to the contributor/members? Are the contributor/members legally obligated to each other without financial or time limits? What and where is this "pool" and how is it established and managed? Are members legally obligated to pay up when the pool drops below a certain level or can everyone just bail out without penalty? How is the pool protected against adverse selection where it disproportionately attracts people with near-zero net worth? The devil is in the details.

Yes, lot's of details that would need to be worked out. However, I am a believer (no pun intended) that the solution to ever escalating health care costs is a model that decreases demand and increases supply. For example, a system that perhaps:
1) Provides 'free' (bundled into the cost) annual well care services and perhaps relatively inexpensive health care screening.
2) Provides 'catastrophic' care, i.e. provides INSURANCE for an event that can't reasonable be handled.
3) Removes/reduces reimbursement (and therefore lessons demand) for other things.
The above is on the demand side. We also need to provide for the supply side in terms of competition among medical personal, reduce those factors that prevent more doctors, PA's, etc., and provide for competition to lower middle man (e.g. insurance company) costs. The reimbursement systems are way too complicated.

Ask yourself why things that are subsidized, for example health care, college tuition, have had the greatest increases in cost over the last twenty to thirty years. Even someone taking Econ 101 learns what happens when demand for a good is subsidized and the result on the supply/demand curve intersection. [Well, at least in the old old days when I was an econ major - who knows about what is taught today.]

 

[athena53]

Not really hearing snide, and in some cases posters trying to be witty (you know who you are) the negativity comes because it's different, doesn't have a really long track record and in some cases the price seems to good to be true.

Regulation leads to increased cost in everything.

While I agree with the latter, my biggest concern with these ministries is that there's no guarantee they could come through with the money for, God forbid, a stem cell transplant or other high-ticket item if I needed it. Regulation of insurance companies provides at least some assurance that they're financially solvent and that they keep their promises.

 

[sheehs1]

Not really hearing snide, and in some cases posters trying to be witty (you know who you are) the negativity comes because it's different, doesn't have a really long track record and in some cases the price seems to good to be true.

Regulation leads to increased cost in everything.

Some of the comments that may have been "witty" are actually very real and were said for those investigating these policies to consider taking a broad view of the things that could happen. And to read the very fine print carefully.

1) Gosh forbid, you loose your spouse, never plan to marry again but would like a significant other.

2) You and your significant other go for a casual, scenic drive. You as the passenger decide to have a glass or two of wine along the way. You get in an accident, end up in the ER, they take blood and discover a bit of alcohol in your system.

If I could remember all the details, I could come up with others. The question is, have they denied coverage for the stipulations they have if you were accepted as a member?

What they deny is as important as what they cover.

 

[ivinsfan]

Some of the comments that may have been "witty" are actually very real and were said for those investigating these policies to consider taking a broad view of the things that could happen. And to read the very fine print carefully.

1) Gosh forbid, you loose your spouse, never plan to marry again but would like a significant other.

2) You and your significant other go for a casual, scenic drive. You as the passenger decide to have a glass or two of wine along the way. You get in an accident, end up in the ER, they take blood and discover a bit of alcohol in your system.

If I could remember all the details, I could come up with others. The question is, have they denied coverage for the stipulations they have if you were accepted as a member?

What they deny is as important as what they cover.

Agree and It's up to each individual to do their due diligence and risk assessments. What is ok for some may not be for others. If you don't think it's workable for you don't take it, but if you take accept it the rules are the rules. The witty comment was actually about the threesome...

 

[ivinsfan]

You have a heart attack, or are diagnosed with lung cancer tomorrow, no problem you say and start treatment, spending $80K, knowing you will get help with the bills.
But the Christian plan goes belly up before paying any of your bills.
You are liable for your bills.
New commercial plan won't pay for treatments in the past when you were not with them, so signing with a real insurance company won't help pay the bills.

This.... and 80K could be a drop in the bucket for those 2 conditions. The second concern is trying to get a negotiated rates if the plan goes belly up. Kind of a double whammy and too rich for my blood.

 

[flintnational]

I read/skimmed the information for the plan MichaelB linked in post #54.

I can't make the math work. The Gold plan is $150 per month per unit (member). It includes a cap of $125k per illness (not total spending). The cap can be increased to $1M for an additional $25 per month per member. The Gold plan shares costs for bills exceeding $500 per illness. As I read it, the deductible is not annually cumulative except for each illness.

If I am reading it correctly a married couple could get the Gold plan with the $1M limit and a $500 deductible for $350 per month. The math part. This is 50% to 75% less than what a 55 yo couple can get with ACA. And the ACA plan would have a much higher $6k deductible. The linked plan indicates the member should ask for the cash discounted price from service providers. The only thing I can think of that would make these plans work, is that their risk pool is significantly younger and or healthier than an ACA pool. The sharing plan is also significantly less than what an unsubsidized employer plan would cost (employer plans tend to have younger healthier risk pools). So how does the math work? What am I missing? In theory, any pooling arrangement is simple. Premiums=Losses/members (profit and expenses excluded). Why are the premiums for sharing groups so much lower?

 

[ivinsfan]

You might be missing the waiting period for pre-existing conditions. The level of staffing a full service regulatory insurance has. .the caps and the fact that it does not cover many of the mandatory things in an ACA policy.

 

[flintnational]

You might be missing the waiting period for pre-existing conditions. The level of staffing a full service regulatory insurance has. .the caps and the fact that it does not cover many of the mandatory things in an ACA policy.

Pre-existing conditions could be a big part of it. The linked sharing plan makes some provision for prex but I think the condition had to be stable on maintenance only to be covered. I wonder if any of these plans release their loss data? It would be interesting to know their per member loss rate. I would fell more confident in the plans if I knew the pool was healthier and had lower claim rates. That could explain the lower charges.

 

[OldShooter]

... my biggest concern with these ministries is that there's no guarantee they could come through with the money for, God forbid, a stem cell transplant or other high-ticket item if I needed it. Regulation of insurance companies provides at least some assurance that they're financially solvent and that they keep their promises.

Yes. And if the weaknesses and risks were all shored up, you would probably have turned them into conventional insurance companies.

... Why are the premiums for sharing groups so much lower?

TANSTAAFL. The reasons are in there somewhere.

 

[OldShooter]

FWIW, I just looked at the "Christian Health Ministries" tax return*.

On the revenue side, they have been growing at 50-100% per year. Quite astonishing. Revenue in 2016 was $220M and they took 13% to the bottom line. Benefits paid for members $175M. (2012 revenue was $29M.)

Salaries look quite reasonable; from that angle it does not appear to be a scam.

Balance sheet shows about $57M in reserves, almost all in non-interest bearing cash. I am no insurance expert but this looks a little weird to me, both in the size of the reserve and the "non-interest bearing" part. Maybe we have insurance-oriented members who could comment.

*guidestar.org A free and no-hassle, no-spam registration will get you access to the tax returns of all but the tiniest USA non-profit corporations. By law, these are public record.

 

[Big_Hitter]

Balance sheet shows about $57M in reserves, almost all in non-interest bearing cash. I am no insurance expert but this looks a little weird to me, both in the size of the reserve and the "non-interest bearing" part. Maybe we have insurance-oriented members who could comment.

those are probably ibnr reserves and are very short term

 

[OldShooter]

those are probably ibnr reserves and are very short term

ibnr?? That cash is basically the whole asset side of their balance sheet. There's nothing else that's material.

 

[Big_Hitter]

ibnr?? That cash is basically the whole asset side of their balance sheet. There's nothing else that's material.

what else would they need on the asset side?

I'm not an insurance guy but I'm pretty sure all health plans have ibnr claims

https://en.wikipedia.org/wiki/Incurred_but_not_reported

 

[copyright1997reloaded]

Balance sheet shows about $57M in reserves, almost all in non-interest bearing cash. I am no insurance expert but this looks a little weird to me, both in the size of the reserve and the "non-interest bearing" part. Maybe we have insurance-oriented members who could comment.

Warning: I don't know what I am talking about here....but there used to be regulation Q requirements on non-profits which prohibited the use of interest bearing checking accounts. That regulation was repealed at the Federal level in 2011, but maybe it is something related to this? (Perhaps at the state level.) Again, my warning, but there must be some reason they need to do this.

 

[OldShooter]

#Big_Hitter, you might want to look at the balance sheet instead of speculating. There are no ibnr liabilities and the $57M is basically equal to retained earnings aka "fund balance." To a non-insurance guy like me that cash looks like a reserve for future losses but I have no idea whether 25% of revenue is somewhere near a typical industry number or is low or is high.

The fact that they have it as "Cash, non-interest bearing" just seems crazy. Edit: Just saw the @copyright1997reloaded comment. I dunno about regulations but every nonprofit I've been involved with has any serious amount of money in investments of some kind, not parked at zero interest.

 

[Big_Hitter]

looked at it

they may not have IBNR liabilities specifically stated on that form 990 but I am almost certain they exist

 

[brewer12345]

Seems straight forward to me. These things are an ugly mix of excluding pre-existing conditions, low limits on payouts for diseases that can be stupendously costly, an ability to declare anything they like not covered (how much is reasonable alcohol consumption, for example?), and a complete lack of accountability to any independent third party regulators. Unsustainable economics on top of it about completes the set.

 

[Midpack]

TANSTAAFL. The reasons are in there somewhere.

Seems straight forward to me. These things are an ugly mix of excluding pre-existing conditions, low limits on payouts for diseases that can be stupendously costly, an ability to declare anything they like not covered (how much is reasonable alcohol consumption, for example?), and a complete lack of accountability to any independent third party regulators. Unsustainable economics on top of it about completes the set.

Sounds like a legitimately good choice for someone who doesn’t really need health insurance, until you do. It was “disappointing” to read this in the OP. Gaming the system in a sense. I’d like to think there is a better answer for the USA.

Our goal is March 1 next year (Age 50 and 58), and one thing I'm concerned with is that my wife will need knee surgery at some point (due to over-exercising). My thought is to set enough aside for injections for a few years, and then transition back to a traditional medical plan when she decides to have the surgery.

 

[Kelor]

FWIW, I met with one person today (A very successful financial advisor) that has Liberty. He swears by it, and has a family of 5. So far, all of his experiences have been better than his previous health care provider.

 

[brewer12345]

Sounds like a legitimately good choice for someone who doesn’t really need health insurance, until you do. It was “disappointing” to read this in the OP. Gaming the system in a sense. I’d like to think there is a better answer for the USA.

Personally, I am far more concerned about these things being sold to the muppets. They will have no idea what they are buying until they have to use it, whereupon it will be too late.