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Health Care Bill Sharing

What is a healthcare bill sharing organization (sometimes called Medical Bill Sharing)?  It is a group of people that have come together to share some of their medical bills.  That sounds pretty simple, but there’s quite a few of these groups and what the offer is all over the place. 

Though it sounds a lot like insurance, these groups are membership driven non-profit organizations.  They are not insurance companies and do not follow the same laws as insurance companies.  They are not governed by your state board of insurance.  All that being said, we do feel that, for some, they are a legitimate alternative to health insurance.

Many of these groups have been operating for decades.  They, like the rest of us have lived through the “Great Recession” and the 2002 recession, and the recessions of the 1990’s.  They have lived to tell the tale and they are growing.  We will get into more reasons in a few paragraphs as to why they are financially sound organizations you can depend on.

Medical Bill Sharing organizations are non-profit and membership driven.  What I mean by “membership driven” is that often members have a lot of input into what all the organization does.  For instance, the members of one organization wanted to help beyond medical bills.  

Now, it helps members families with burial and memorial service expenses (up to certain limits…and that doesn’t mean you don’t need life insurance.) and shares some expenses related to adoption.  Membership driven means the members have input, but also that it is the members monthly fees that are used to share the medical bills of others.

Are Medical Bill Sharing Oraganizations Compatible with Obamacare?

One of the provisions of the ACA (The Affordable Care Act i.e. Obamacare) was that everyone is required to have health insurance. That provision has been repealed but the repeal doesn’t take effect until 2019.  The medical cost sharing organizations have an exemption though.  So, if you join you will not have a penalty for those months in which you are a member. 

Is Medical Bill Sharing really a Financially Legitimate Alternative?

I used to work for a large Fortune 500 company.  They had around 25,000 employees in North America.  A group of 25,000 employees is enough to create a decent sized risk pool.  Many of the bill sharing organizations have hundreds of thousands of members. 

When it comes time to share those bills there is a large group of members to draw from.   There are other reasons why medical bill sharing organizations are legitimate alternatives to health insurance. 

The items discussed below are both drawbacks to bill sharing organizations, and they are also why their membership fees are so much lower.  By not sharing, or having limited sharing, on some medically related bills it creates a dynamic where they do have the financial wherewithal to share medical bills when the dollar amounts start to climb (such as a car wreck or cancer diagnosis).

Drawbacks to Medical Bill Sharing Memberships

Medical Bill Sharing Memberships generally do not cover pre-existing conditions

Most have waiting periods on covering pre-existing conditions.  If someone with a pre-existing condition does enroll then those bills won’t be covered for a period of time (typically 2-3 years).  Over that period of time many will have those conditions dealt with through other means. 

The person’s medical issue might clear up or at least be minimized so that when the bills are shared they are minimized.  On top of that many people with pre-existing conditions will simply choose to sign up with health insurance.  These dynamics mean that the people who join are, on average, probably healthier.  This means lower  membership fees for these organizations as compared to health insurance.

Medical Bill Sharing Memberships generally do not cover preventive care

Health insurance policies are now required to include preventive care. That includes wellness visits, annual check-ups, etc.  That’s not a bad thing as many health issues will be caught sooner rather than later.  However, that is not the role of insurance.  Insurance is a financial tool that is meant to restore people to their previous financial condition or at least limit people’s financial losses. 

A planned expense is not a financial loss.  Preventive care is a planned expense.  Most medical bill sharing organizations are not going to cover preventive care.  There are some organizations that do share preventive bills for young children, but even then, many members use their county health departments for this care. 

Keep in mind that just because a bill is eligible for sharing does not mean it gets shared.  These organizations, just like health insurance, typically have an amount of medical bills that you pay first before they start to share the bills (this is similar to a deductible with health insurance). 

These dynamics lower membership fees for these organizations as compared to health insurance.

Medical Bill Sharing Memberships generally do not cover Mental Healthcare

Mental healthcare now has parity in health insurance policies to medical care. Let me give you an example of what this means.  If you break your leg, then you need medical care.  You go to the ER and get the leg set in a cast.  Your insurance then pays part or all of the bill.  Let’s now say that you lose a loved one, or a job, or struggle with depression.

Now you need mental healthcare.  You go see a counselor, social worker, or psychologist and you get the care you need.  Again, your health insurance pays all or part of the bill.  For both mental healthcare and preventive care there are exceptions.  Some bill sharing organizations will share those things, some will not.  The ones that do have higher membership fees.  The ones that don’t have lower membership fees.

Most Medical Bill Sharing memberships are faith based and do not share bills related to mental healthcare.  Whether this is because of a fear of a psychologist using “humanistic” approaches or something else I don’t know. 

Once again though, this dynamic will lower membership fees for the organization as compared to health insurance.

Medical Bill Sharing Memberships generally do not have the best Prescription costs

At this point many health insurance organizations do not have great prescription costs either.  That being said, time and time again I get the question, “The pharmacist told me without using my insurance my prescription was going to be $12, but if I did use my prescription it was going to be $25…that doesn’t make any sense!  Why should I use my insurance if I am going to get charged more?” 

I never have a great answer for those people.  Prescription benefits with Medical bill sharing organizations are sometimes shared.  Sometimes there are time limits on how long they will share for a certain drug.  Most have some sort of partnership with an on-line prescription discount organization and many are fluent in how to apply for the pharmaceutical company’s aid programs.

Again, having limited membership sharing for prescription costs lowers their fees compared to health insurance.

Who should consider joining a Medical Bill Sharing Organization?

Generally speaking, the people that will consider joining these organizations are still healthy.  They are people who maintain a healthy weight and don’t smoke.  These organizations are generally faith based and are not going to attract the kind of people that abuse drugs and are sexual active outside of marriage. 

These are also going to be people who are comfortable with technology.  Many of these organizations have some sort of internet or phone-based doctor you can contact for small issues.  Over time you will see health insurance companies roll these kinds of benefits out to their members as well.  In this respect the medical bill sharing organizations are really on the cutting edge. 

The organizations that they contract with to help you find the best price on prescriptions will also be online (or by phone generally).  Getting on the internet to get information or to skype with a doctor is something most members need to feel comfortable with. 

By and large enrollees will be under 65 years of age.  Once people are eligible for Medicare most go in that direction.  The coverage is good and the premiums are reasonable in that system. 

If I join a Medical Bill Sharing organization how much do I pay when I go to the doctor or hospital?

The bill sharing organizations we work with typically will have a reasonable fee that you pay when going to a primary care doctor or a specialist.  They can do that because they both use the PCHS PPO network for doctors. 

The doctors in this network have already agreed to the negotiated rates used by PCHS.  This also Healthcare Bill Sharing organizations understand exactly how much they will have to share for each procedure or office visit.  It’s also a point of familiarity with doctors and hospitals. 

Many might not have ever heard of a “medical bill sharing organization,” but they have heard of the PCHS PPO network. 

How much you end up paying on your larger medical bills really depends as there are quite a few different options.  What you pay up front before sharing begins obviously has an impact.  What you pay up front might be called an “annual household portion” or a “member shared responsibility amount.”  It’s similar to a deductible.  You are going to pay first before bills are shared.  How much is shared depends on the plan you pick.  It could be 50% or 100% or some number in between.  We can help you understand your options.

When I call these Medical Bill Sharing groups will I be able to get help?

My experience has been that the people I call in and talk with are some of the best trained, most polite people I have ever spoken to in customer service type setting.  I never feel that they are trying to rush me off the phone.  It’s really just a different dynamic with these organizations.  They aren’t out to pay stockholders or make the CEO $7,000,000 a year.  They will help you and they will even pray with you sometimes.  It’s a remarkable thing.

A Hypothetical Example of How Cost Sharing Works

This is an example. This is a hypothetical.  Your situation will depend on an enormous number of variables.  We do not know the negotiated rates for specific procedures and care.

Let’s say you have a diagnostic Scan done.  You get the bill from the hospital and it looks something like this.

Diagnostic Scan…….Billed Rate………………….$45

Network Discount……………………………………..$1200

Payable Amount (Negotiated Rate).…………..$3300

The above example shows the negotiated rate, after the network discount as being $3300.  What you pay will depend on what you chose for your “Annual Household Portion” or “Member Shared Responsibility Amount” (the number that you will choose that is similar to a deductible).  If you chose $1000 then you would pay the first $1000 and the balance $2300 would be eligible to be shared.

If you chose a $5000 amount then you would pay the whole $3300 and it would count towards that “Annual Household Portion” or “Member Shared Responsibility Amount.”

For more information click on the logos.  Here you can quote and enroll.  Alternatively, you can call at 865.712.5711 and we can help walk you through the process, answer questions, and maybe ask some you have not yet thought about.