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he cost of health insurance can be financially crippling for many families. Traditional health insurance plans have continued to increase in price for those who don’t qualify for subsidies. But what other options are out there for coverage? We’ll share some in this blog post!
As of 2022, the average cost of a traditional health insurance plan covering a family of four, before accounting for the Affordable Care Act subsidy, was more than $1,200 per month. That’s $14,400 per year.
Even many families who do qualify for a subsidy are still feeling the strain, between high out-of-pocket premiums, deductibles, coinsurance costs, and copays, leaving families struggling to afford necessary healthcare.
That’s why the health sharing alternative is soaring in popularity. Read more about how Traditional Insurance plan is different from Health Sharing.
Health sharing plans come with significantly lower monthly costs, compared to traditional ACA-style health insurance policies. This makes them an attractive alternative for families looking to save money – especially if they are in good health, with no significant pre-existing conditions.
Traditional Health Insurance vs. Health Sharing Plans at a Glance
| Traditional Health Insurance | Health Sharing Plans |
|---|---|
| High cost, but qualifies for subsidies | Lower cost, does not qualify for subsidies |
| Immediate coverage of pre-existing conditions, surgeries | Costs related to pre-existing conditions, surgeries may be subject to waiting periods |
| Secular | Many, but not all, are faith-based |
| Subject to regulation by state insurance commissioners | Not regulated by state insurance commissioners |
| Narrow care networks (HMOs and PPOs) | More freedom to see providers of your choice |
| Limited open enrollment periods |
Enroll at any time |
One of the key differences between health sharing and traditional health insurance is the way healthcare costs are shared.
In a health sharing plan, members contribute a monthly share amount, which is used to cover the medical expenses of other members. This shared responsibility model can result in lower costs for members who do not require frequent healthcare services. However, it is important to note that health sharing plans are not insurance and do not guarantee coverage for all medical expenses.
Health sharing plans do not qualify for premium subsidies under the Affordable Care Act.
This means that if you switch to a health sharing plan, you may lose the financial assistance provided by the ACA.
Be sure to take any subsidies into account when considering switching to a health sharing plan.
Savings can vary depending on factors such as the size of your family, overall health condition, whether you receive an Obamacare subsidy due to your income, and how much healthcare you and your family consume.
Families who don’t receive an Affordable Care Act subsidy save the most: Health share plans routinely save around 40 to 50% compared to the cost of a traditional ACA-qualified health insurance policy purchased via the Marketplace.
The cost savings are so great that many families who receive a subsidy can still save money by switching to a health sharing plan.
Note: While health sharing plans generally have lower monthly costs, they may also come with certain limitations, such as restrictions on pre-existing conditions, surgeries for new members, or specific types of treatments.
For this reason, health sharing plans may not be a great match for people with pre-existing conditions.
Healthshare plans vary. It is important to review the details of each health sharing plan to understand the potential savings that can be achieved.
Click here for more details on how health sharing plans can save you hundreds of dollars every month.
Health sharing plans typically allow members much more freedom to choose their own doctors, hospitals, and other providers compared to traditional health insurance HMOs and PPOs sold over the health insurance exchanges.
If healthcare freedom is important to you, and pre-existing conditions aren’t a factor for you, health sharing may be a good option.
Individuals with pre-existing conditions should carefully evaluate the limitations and coverage offered by health sharing plans.
While some health sharing plans do help share expenses for certain pre-existing conditions, they all have waiting periods or exclusions.
If you or a family member has a pre-existing condition that requires regular medical care, it is important to ensure that the health sharing plan you are considering will provide the sharing benefits necessary to protect you and your family against a potential financial catastrophe due to the high cost of health care.
Switching from a traditional health insurance plan to a health sharing plan can offer cost savings for some families.
However, it is crucial to consider the potential limitations, such as restrictions on pre-existing conditions and coverage for specific treatments. Before making a decision, give us a call.
