What Colorado Data Tells Us About the Wild West of Health Care Cost-Sharing Ministries

The Sharing

The 14 groups that submitted sharing figures noted that they focus on paying for expensive medical care for new conditions and often reject efforts to share bills for mental health care, routine pregnancy costs, or costs related to preexisting conditions, such as asthma, cancer or diabetes.

The groups also ask members to negotiate with providers and to try to use any health coverage they have, such as Medicare or Medicaid, first.

The groups said they received requests for $362 million in expense sharing in 2021, or about $5,300 in requests per member, and classified $131 million of the expenses, or about $1,900 in expenses per member, as being eligible for sharing.

The Context

The ministries are similar in some ways to supplemental health insurance policies that consumers can use to pay out-of-network hospital bills.

Colorado regulators did not provide information about commercial health insurers' or public plans' typical reimbursement percentages for the kinds of medical expenses that health care cost-sharing ministries typically share.

William Johnson and colleagues reported in 2020, in a paper in the academic journal Health Affairs, that, in 2017, U.S. health insurers they analyzed paid an average of $17,768, or 56%, of the $31,567 average bill for a covered, out-of-network, inpatient hospital procedure.

In 2017, the annual out-of-pocket maximum for ACA-compliant individual major medical coverage was $7,150. That means that, if a patient with individual major medical coverage had a $7,150 deductible, and had an out-of-network procedure that cost $31,567, the insurer might pay $10,618 of the billed amount, or 34% of the total.

Regulators' View

Colorado officials contend that many consumers who are used to ACA-compliant coverage may not understand the gaps in health care cost-sharing ministry coverage or the difference between the billed amounts and what the ministries might end up paying.

Michael Conway, the state's insurance commissioner, said some consumers who call regulators about HCSAs have thousands of dollars in unpaid expenses.

"It shows me that people are clearly not getting the full story from the companies when they sign up for HCSAs," Conway said.

The National Association of Insurance Commissioners put out a notice warning consumers about the limitations of the ministries and other ACA coverage alternatives, such as health care discount programs, in November 2022.

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