A recent article in the Wall Street Journal found here highlighted many of the reasons that as a health insurance broker, I have never opted to provide non-Affordable Care Act Qualified Health Insurance Plans. You will see these plans such as US Health, Freedom Life, and even the religious based medical share plans leave people on the hook for thousands of dollars of exposure to bills.
Hospitals and providers still work off of contracted rates with the insurance companies, or can charge the highest rate if someone doesn’t have insurance. According to this analysis by the Journal, the non-qualified plans such as Freedom Life use rented network rates which often can even be MORE expensive than someone who doesn’t have insurance. Also, plans like indemnity options that only pay out a certain amount of money for each plan area does not cap the costs to the insured member, therefore balance billing the rest to the individual. Because the providers will balance bill the unpaid amounts to the patient, it can leave them on the hook for a bill sometimes totaling in the hundreds of thousands of dollars. Most of the time, people don’t have that kind of money, which is why they bought insurance in the first place, and the bills are sent to collections, ruining that person’s credit.
Be very careful in selecting a plan from a non-qualified health insurance coverage, and definitely work with someone who knows about these issues and can navigate the plans appropriately with you.
The following are some of the quotes from the article I think are worth highlighting but I would recommend reading the entire article if you’re interested:
“Health insurers typically build their plans around confidential deals that lock in prices for hospitals and doctors within their provider networks. Insurers negotiate the rates for different services covered by their plans—rates that started becoming public this year under a new federal rule for hospitals. The Journal has used the data to illuminate the widely varying rates paid for the same service, at the same hospital; the high prices often charged to the uninsured; and the unpredictability of prices even for those with insurance.”
According to the article, the plan “paid to use a rental network called PHCS, which had the highest negotiated rates at Baptist Health’s flagship Miami hospital, according to pricing data—even higher than the cash rates for those with no insurance at all.”
“The Journal’s review, including data for 836 hospitals, found the rates of some of the biggest rental networks were consistently among the highest prices that hospitals negotiate.
More than half of the time, one of the rental networks had the highest overall rate in the analysis. The rental networks, on average, had rates that ranked in the most-expensive third of negotiated prices, higher than any of the national insurers, the Journal found. In some cases, they were even higher than hospitals’ rates for uninsured patients.”
““Those rental networks are cobbled into products that don’t really protect you,” said Cindi Gatton, owner of Pathfinder Patient Advocacy Group in Atlanta. “You really get caught between a bad plan design and discounts that aren’t as good as you would be able to negotiate on your own.””
“The rental networks are used by some plans that aren’t traditional health insurance and don’t have to meet requirements set in the Affordable Care Act, such as coverage of pre-existing conditions and limits on patients’ out-of-pocket costs.”
“That includes some plans offered by organizations with religious affiliations, known as healthcare sharing ministry plans. They aren’t insurance, but they are set up to allow subscribers to share each other’s medical expenses. About 1.5 million Americans are members, according to the Alliance of Health Care Sharing Ministries, a trade group.”
“Arthur Saroughian, 55, a pharmacist in Glendale, Calif., said his family enrolled in Medi-Share, a healthcare sharing organization, in 2018, because its Christian values and message of sharing appealed to them, and he thought it would cover them much like traditional insurance. His Medi-Share card had the PHCS network logo and listed what appeared to be an out-of-pocket charge of $35 for a hospital visit.
After a July 2019 angiogram at Huntington Hospital in Pasadena, Calif., Dr. Saroughian was billed considerably more: $21,465, the PHCS network rate. Pricing data shows that PHCS’s rates are usually among the highest the hospital has negotiated. For Dr. Saroughian’s heart procedure, the current PHCS rate of $11,148 is the hospital’s highest negotiated price. A Cigna health-maintenance organization plan’s rate is $4,083.
According to documents viewed by the Journal, Medi-Share deemed his procedure related to a pre-existing condition, which it wouldn’t cover.”
“Dr. Saroughian said his cardiologist believed he had authorization from Medi-Share for the angiogram, and he ordered it because of recent chest pain, rather than an ongoing issue with irregular heartbeats. The bill was sent to a collections agency. Dr. Saroughian said he offered to pay a portion of the total.”
“On Sept. 16, 2020, Ms. Colón was awakened early in the morning by her 2-year-old granddaughter and discovered that she couldn’t move the left side of her body. Her husband quickly realized she had had a stroke.
Surgeons at Baptist Hospital of Miami removed four clots from her brain. She was discharged on Sept. 21. Weeks later, the bills started to arrive.
She paid some individual doctors’ bills, but the hospital bill came to $211,872. The PHCS rental-network discount took off 10%, or $21,187. The Freedom Life policy paid $15,000. That left her owing $175,685.”