Health Care Sharing Ministries: What Are the Risks to Consumers and Insurance Markets?

Health care sharing ministries (HCSMs) are a form of health coverage in which members--who typically share a religious belief--make monthly payments to cover expenses of other members. HCSMs do not have to comply with the consumer protections of the Affordable Care Act and may provide value for some individuals, but pose risks for others. Although HCSMs are not insurance and do not guarantee payment of claims, their features closely mimic traditional insurance products, possibly confusing consumers. Because they are largely unregulated and provide limited benefits, HCSMs may be disproportionately attractive to healthy individuals, causing the broader insurance market to become smaller, sicker, and more expensive.

To understand state regulator perspectives on regulation of HCSMs and the impact of these arrangements on consumers and markets.

Analysis of state laws governing HCSMs in all states; interviews with officials in 13 states; and review of the membership requirements and benefits of five HCSMs.

State regulators voiced concerns regarding the potential risks of HCSMs to consumers and their individual markets. However, in the absence of reliable data describing HCSM enrollment, regulators cannot adequately assess harm. Though limited resources and political constraints have made oversight difficult, all states, regardless of their regulatory approach to HCSMs, should obtain data to better understand the role of HCSMs in their markets.