5 Healthcare Alternatives You Should Know About

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Is the fear of losing your health insurance holding you back from leaving your job to start your own business? Then you need to look into this 5 healthcare alternatives.

Health Savings Accounts (HAS)

Health Savings Accounts (HSA) is a savings account used in conjunction with a High Deductible Health Plan (HDHP) that allows users to save money tax free against medical expenses. HSAs may earn interest tax free. HSA funds can be used to pay for qualified medical expenses at any time without federal tax or penalty. Medical expenses include but not limited to ambulance services, diagnostic services, chiropractors, hospital services, lab fees, prescription medications, and xrays to name a few. According to federal guidelines, you can open an HSA if you are:

* Covered under an HDHP the first day of the month

* Not covered by any non-HDHP plan (with some exceptions for certain plans with limited coverage such as dental, vision, and disability)

* Not enrolled in Medicare

* Not claimed as a dependent on someone else’s tax return

Pros

* Others can contribute to your HSA-you, your employer, a relative, anyone

* Pre-tax Contributions made through payroll deposits (employer) made with pre-tax dollars are not subject to federal income tax dollars and, in most states, not subject to state tax dollars

* Tax Deductible contributions made with after tax money can be deducted from gross income on one’s tax return which may cause one to owe less taxes at the end of the year

* Interest earned is tax free

* Funds rollover from year to year

* It remains available for future qualified medical expenses even if you change insurance plans, employers, or choose to retire

* Very convenient-often a debit card is provided that you can use to pay the expenses immediately as well as use at the ATM to access cash

Cons

* With high deductibles, it’s difficult to come up with the money to satisfy the deductibles

* There’s always the possibility that you have unexpected health costs that exceed what you are saving in your HSA

* Because there is some pressure to save, you may be reluctant to seek healthcare so you don’t use the HSA

* If you were to withdraw the money for non-qualified medical expenses before 65, then taxes would be owed plus a 20% penalty. If it was after 65, there would be no penalty but you would still owe taxes.

* You do have to be diligent about keeping receipts so it can be verified that you spent the money on qualified medical expenses.

* There are some times fees as some payers charge monthly maintenance fees or a fee per transaction

Generally, it’s a great choice for people who wish to limit their upfront health care costs while saving for future healthcare expenses. It’s generally for people who do not expect to have a lot of healthcare expenses throughout the year and who do not have small children as they tend to have to see the doctor more often.

Consumer Operated and Oriented Plans (CO-OP)

Consumer Operated and Oriented plans, also known as CO-OP Health plans are non-profit, member-controlled health insurance plans whereby the same group of people that own the company are insured by the company. They can be formed at the national, state, and local levels and can include doctors, hospitals, businesses, small markets, and other groups as members. CO-OPS cover medical, dental, prescription medications, and any form of healthcare that is typically covered by a traditional health insurance program. CO-Ops are best suited for people of like minds and like situations who have the same or similar medical necessities that they can determine to be covered. An example of a health insurance co op is a medical cooperative that is owned and operated by an organization of senior citizens in a particular state. The medical cooperative is owned by a geriatric doctor. The members of the plan are all over the age of 62 years old, and they all decide to cover all doctors, treatments, and procedures that are most common to their needs as senior citizens.

Pros of CO-Ops

* They have more affordable costs compared to that of traditional insurance companies

* The earnings of the group are held inside the group to benefit the whole

* The plan, being exclusive to the small group, allows for common medical necessities to be covered. Because the group can narrow down their necessities, they have more profit to ensure their necessities will be covered.

* Because the group is non-profit, they are self-regulated therefore not regulated by government or major corporations. Coverage is based on the needs of the members as they have control

Cons of the CO-Ops

* Being a part of a group means that you have to conform to the group. Because some CO-OPS are faith-based or politically-based, one may not receive coverage for procedures, medications, doctors, and clinics that are

against the group’s common beliefs. And because the majority rules, if you are outnumbered then you are out of luck

* CO-OPS lack government oversight. Therefore if they run out of money, they are not eligible to receive government assistance like major insurance companies can (i.e.loans)

* CO-OPS lack incentive for competition with other major insurance companies. Consequently, they won’t be driven to improve and provide the best services and benefits to the consumer.

Christian Health Ministries (CHM)

Christian Health Ministries is an affordable, faith-based, and biblically-based solution to the rising healthcare costs whereby thousands of Christians across all 50 states unite to share in the costs of each other’s medical bills. They are not an insurance company but considered to be a nonprofit health cost sharing ministry through which Christians voluntarily share each other’s medical bills. In order to become CHM members, you must be a Christian living by biblical principles including abstaining from the use of tobacco and illegal use of drugs, following biblical teachings on the use of alcohol, and attending group worship regularly if health permits.

Pros

* Affordable

* You can choose own Healthcare provider

* Exempt from the Affordable Care Act penalties

* No enrollment period – one can join any time throughout the year

* Monthly financial gifts not increased based on age, weight, medical condition etc.

Cons

* Unregulated

* Do not guarantee claims will be paid since there is no contract between payer and the patient

* Members must negotiate with doctors for discounts or to set up monthly payments

* Certain procedures and services may not be covered if it’s not in agreement with the beliefs of the Christian faith (i.e. contraceptives, out-of-wedlock pregnancies, etc)

Medical Cost Sharing

Medical Cost Sharing is a group of like-minded individuals that agree to come together to help each other pay their medical expenses. It is the share of costs covered by your insurance that you pay out of pocket such as deductibles, co-insurance, copayments, or similar charges. It does not include premiums, balanced billing amounts for non-network providers, or the costs of non-covered services. These are not healthcare or health insurance, it’s an affordable way to plan for unforeseen medical expenses. They offer faith-based planning for addressing these unforeseen medical expenses. Since it is not health insurance, you don’t have to play by the same rules. There are no network requirements, you can go to whatever doctor that you’d like. Once you enroll, you get a membership card. When the doctor asks for your insurance, you just give him/her your membership card.

How it works is that everyone pays in a certain monthly share amount. For your own expenses you are responsible for covering an “annual personal responsibility” amount or an “unshared amount” much like a deductible. The rest of your medical expenses is shared amongst the group from what they have paid in. Since they are faith-based, they do have different guidelines such as smoking or certain pre-existing health or lifestyle-related conditions in which they decline membership or coverage of those related expenses. They do have family programs where the entire family can participate for less than $500/month which is a maximum.

Proponents of these programs say that they are more affordable, provide more choices, are more personal as opposed to corporate, provide exemptions for the Affordable Care Act (Obamacare) therefore will not get penalized, and for the person of faith it is more in line with one’s own beliefs and values. Opponents of these kinds of programs emphasize that they are unregulated, don’t guarantee claims will be paid, for the person not as aligned with the faith it can be restrictive, and it hurts the overall healthcare industry because it takes a segment of the people out of the insurance market. The four major examples of these kinds of cost-sharing ministries are Christian Healthcare Ministries, Samaritan Ministries, Medi-Share, & Liberty Healthshare.