The Colorado Division of Insurance receives hundreds of complaints a year from consumers, but few trouble chief deputy commissioner Kate Harris as much as the ones she began hearing earlier this year.
They concerned a company called Aliera Healthcare and an organization it administers called Trinity Healthshare. Trinity is a so-called health care sharing ministry, a group that pools members’ money to help pay medical bills but, because of an exemption in the law, doesn’t have the legal obligations that modern insurance companies do. In some ways, sharing ministries operate the way insurance companies used to before the Affordable Care Act — cheaper but also less comprehensive.
So, when Harris began hearing complaints that Aliera and Trinity were making promises they weren’t living up to, she took them seriously.
“The ones we received, honestly, they keep me up at night,” she said. “They’re devastating.”
Harris declined to say more because of her ongoing investigation. But that investigation has already led to an unprecedented enforcement action against a sharing ministry in Colorado: cease and desist letters sent to both Aliera and Trinity. The letters accuse the companies of essentially marketing themselves as insurance providers without offering the same level of security.
But, in Colorado, Aliera and Trinity are just one element in an increasingly complicated — and, perhaps, increasingly popular — sharing ministry landscape. And, with open enrollment for 2020 health insurance plans coming up, it’s a landscape tens of thousands of Coloradans struggling to pay for traditional insurance might consider exploring.
According to the Alliance of Health Care Sharing Ministries, Colorado is one of the top 10 states for participation in sharing ministries, with an estimated 21,000 households and 53,000 people participating in one. There are ministries strictly limited to small religious communities, but also ones open to more of a general population. The chamber of commerce in Eagle County has helped form a sharing program to give workers there relief from notoriously high insurance premiums.
All of this rankles state regulators, who have repeatedly noted that the sharing programs don’t provide the protection of insurance.
The programs can exclude coverage for pre-existing conditions, for instance. They may have lifetime limits on coverage. Because many are faith-based, they may not cover treatments for conditions that the ministries believe are the result of poor moral choices. At the most basic level, the sharing programs have no obligation to pay for anything — and consumers are unable to sue if they believe they have been unfairly denied.
But regulators also don’t have authority over the programs unless they cross a line and bill themselves as insurance — as Trinity and Aliera are accused of doing. (The companies deny wrongdoing.) So, state officials don’t know how many sharing programs are operating in the state or exactly how they function.
“We know how they market, and then we know what consumers tell us and the nature of their complaints,” Harris said. “I would say those things, from what we’ve found, are not always in alignment.”
Advocates for sharing ministries, though, say they fill an important role in the market. Some people don’t want all the coverage that fully insured plans must provide — or they can’t afford it.
And regulatory actions in Colorado may have pushed more people into the sharing programs. One broker said they are currently the only option for people in the state looking for short-term health coverage, after the Division of Insurance raised the standards for companies offering traditional short-term plans. Instead, those companies bolted from the market.
“As long as the broker is honest and the consumer knows what they are buying, for some people it’s a good fit,” said broker Brad Niederman, who is also active with the Colorado Association of Health Underwriters.
But Niederman won’t sell health-sharing coverage to his clients.
“It’s not an insurance product,” he said. “No. 1, first and foremost, I like to sleep well at night.”
He added: “If it’s not something I would buy for my family, then I struggle with selling it to someone else.”
How they work — or don’t
There is no single template for how sharing ministries operate, but the biggest ones generally have a few things in common. Members pay a monthly “share” that is often based on their age, how healthy they are and how many people are in their family. When members incur medical expenses, they have to pay a certain percentage themselves and can submit a claim to the ministry to cover the rest.
If this sounds a lot like how insurance works, that’s because, from a consumer’s perspective, it is.
“The important difference here that really matters to the consumer is there is no promise to pay,” said JoAnn Volk, a research professor at the Georgetown University Center on Health Insurance Reform who has studied sharing ministries.
Sharing ministries have been around for decades — think of Amish or Mennonite communities, which make up the vast majority of the roughly 100 sharing ministries nationwide. And they were given a specific exemption from the Affordable Care Act’s mandate that everybody have health insurance.
That exemption, though, caused sharing ministries’ membership rolls to boom. Volk said there were an estimated 200,000 people in sharing ministries nationwide before the Affordable Care Act passed. Afterward, as the price to buy insurance on your own also boomed, the number grew to more than 1 million, she said.
Now, as the Trump administration and congressional Republicans have chipped away at the ACA — including effectively eliminating its coverage mandate — Volk said the concern is that the traditional insurance markets will get even more expensive. Those who are healthy and feel they don’t need as much coverage will look at other options. And that creates a new opportunity for sharing ministries.
“That was the whole point of the agreement: You can’t be denied coverage because you’re sick. but you have to have coverage, even if you’re not sick,” she said, referring to the ACA. “Now that that’s gone away, I think it’s sort of an invitation to scammers.”
And that’s concerned some advocates for sharing ministries, as well.
Dave Weldon, a former member of Congress who is now the president of the Alliance of Health Care Sharing Ministries, said the three big Christian ministries that are part of his group each settle millions of dollars in medical bills per month. As long as a claim meets the ministries’ requirements, he said, “there’s no history of these ministries not sharing.”
But that might not be true for all the ministries out there. Aliera, Weldon noted, is a for-profit company that only came into being after the ACA’s passage. It isn’t a member of the alliance, Weldon said, because the group never invited it to join.
“You’ve got a bunch of businessmen who got into the sharing world,” Weldon said. “That’s what Aliera is. I’m not sure they were motivated by Christian charity.”
A needed surgery and a “pre-existing condition”
Jared Beard has always thought of his family as healthy.
But, as the co-owner of a small auto-repair business in Parker, he was paying $18,000 a year in premiums for a family health insurance plan with a $7,500 deductible. That’s more than $25,000 a year before benefits really kick in, all for a family that didn’t visit the doctor that much.
“We were way overpaying for health insurance,” he said.
So, last year, when he heard of another coverage option through Aliera and Trinity that could save his family $500 a month, it seemed too good to be true. He dug in with questions. What would be covered? What wouldn’t be? What’s the catch?
Ultimately, he understood there were limitations, but he was OK with them. No one in his family had any pre-existing conditions. And, as a Christian, he felt at ease dealing with a company that presented itself as Christian, too.
That good feeling changed less than six months into his family’s coverage.
Beard’s 14-year-old daughter began complaining of hip pain. Finding a doctor who would accept the sharing ministry’s coverage, though, proved a challenge. And, when Beard finally learned that his daughter would need surgery to correct the problems, he says Aliera had another surprise for him.
It denied the claim.
“They said, well, it’s a pre-existing condition,” Beard said. “They said she was born with a hip deformation.”
To Beard, that definition for a pre-existing condition made no sense. His daughter hadn’t been diagnosed with anything until after the family was covered by Aliera. But an appeal proved fruitless, and there was no other recourse.
The cost of surgery was too much for him to pay out of pocket. So he resigned himself to a difficult conclusion: his daughter would have to live in pain for months until the family could sign back up for traditional insurance that would cover the surgery costs.
“That company is now going to be paying for it, which to me is not right,” Beard said. “It just shows how broken our system is.”
As part of his effort to get Aliera to cover his daughter’s surgery, Beard reached out to the Colorado Consumer Health Initiative, a consumer-advocacy group. Debra Judy, CCHI’s policy director, said she has received a handful of other complaints about the company, and, in a lot of cases, customers were confused about what they had purchased.
“People thought what they were buying operated like insurance, and then they couldn’t get a claim covered,” she said.
And it’s that consumer confusion — not the unpaid claims — that led to the cease and desist letters against Aliera and Trinity.
Harris, the chief deputy insurance commissioner, concluded that the companies, through their marketing and the way they described their plans, were acting as unlicensed insurance companies. For instance, the companies were paying commissions to insurance brokers to sell their products. Harris accused the companies in the letters of conduct that “is fraudulent, creates an immediate danger to public safety and/or is causing or can be reasonably expected to cause significant, imminent and irreparable public injury.”
In an emailed statement, Aliera denied the accusations and said it is working to address the Division of Insurance’s concerns. A spokesman for the company provided plan documents given to consumers that have the sentence “This is NOT insurance” written at the bottom of each page.
“AlieraCare plans are built on an innovative cost-sharing model that is designed to streamline access to individual and family-focused healthcare choices without the costs and complexities of most one-size-fits-all traditional medical insurance plans,” one of the documents states.
The company’s statement to The Sun struck a combative tone.
“Aliera will continue to vigorously defend against false claims made about the administrative, marketing and other support services we provide to health care sharing ministries (HCSMs), and we’re confident the HCSMs we support will defend the right of their members to exercise their religious convictions in making health care choices,” the statement read.
Colorado is not the only state to take action against Aliera. Washington state hit the company with a more than $1 million fine. Texas sued Aliera earlier this year, seeking to stop it from selling insurance without a license. New Hampshire and Massachusetts issued consumer warnings about the company. And officials in other states are also reviewing complaints, according to Kaiser Health News, which reported that Aliera is operated by a Georgia woman and her husband, the latter of whom was convicted in 2006 of federal securities fraud and perjury.
Regulators at the Colorado Division of Insurance are watching out for other sharing ministries that may have crossed the line, too, though no other formal investigations have been opened. Things that get their attention, a spokesman wrote in an email, are when sharing ministries describe their benefits as being similar to those in Affordable Care Act-compliant plans; when they group their plans into gold, silver and bronze levels the way ACA plans do; or when they use terms like “minimum essential coverage” that are typically associated with ACA plans.
But despite the burst of negative attention, Niederman, the insurance broker, said sharing ministries that stay within the rules aren’t going away in Colorado. They now hold too prominent a position in the market.
“It serves a need, and I get it, I definitely get it,” he said. “At the end of the day, something is better than nothing.”
“In a perfect world, we would not need the sharing plan.”
Chris Romer knows that the sharing plan he helped put together as the head of the Vail Valley Partnership is not ideal.
“A niche program for a niche audience,” is how he describes it. (Colorado Insurance Commissioner Michael Conway once described it differently, likening it to a subprime home mortgage.)
The partnership’s web page for the One Valley Healthcare Program says no fewer than eight times that the program is not insurance. Romer said the partnership, which serves as the chamber of commerce for Eagle County, has a 28-minute webinar describing all the ins and outs of the program and how it falls short of full coverage.
“In a perfect world,” he admits, “we would not need the sharing plan.”
But that’s not the word he inhabits. The uninsured rate in Eagle County has hit 17%, he said, nearly three times higher than the statewide average. And 80% of the businesses in the county employ 10 or fewer people — leaving them unable on their own to leverage the market power that bigger companies do to get better deals on insurance.
Romer said the partnership is exploring creating a health care purchasing alliance similar to the revolutionary one in Summit County that launched this year. But, in the meantime, there’s the health care sharing program. There are currently more than 200 members, he said.
“The program itself has worked well,” Romer said. “Knock on wood, we haven’t had any major problems or challenges.”
This pretty much sums up why sharing programs have a continuing appeal for Coloradans, despite warnings about their risks. In some cases, it’s the least-bad option.
Last year, officials at Connect for Health Colorado, the state’s insurance exchange, conducted focus group testing to better understand what customers are looking for in the health insurance market. But they soon began hearing responses from people talking about health care sharing ministries — including one in particular, a Christian program called Medi-Share.
The focus groups showed that people generally had positive experiences with health care sharing ministries and they were thrilled to be saving money. At least some understood that the ministries weren’t the same thing as insurance — but those in the focus groups felt they were close enough. A few people said they had trouble getting a claim paid. But they asked: Didn’t that happen with regular insurance too?
““[With Medi-Share] I had to jump through a few hoops for my surgery,” a man from Colorado Springs said in a focus group, as quoted in a later report about the research, “but it didn’t matter which insurance I had. I’ve had to, you know, just jump.”
People seeking only short-term health coverage have found themselves in a similar leap-of-faith moment in Colorado this year, Niederman said. In January, Conway adopted a rule requiring short-term plans to meet Affordable Care Act requirements. The move was an attempt to prevent short-term plans from undermining the ACA, which the Trump administration has attempted to use them to do.
But Niederman said there was also an unintended consequence — there are no longer any short-term plans on the market. So, when someone needs coverage for only a couple of months before starting a new job, there’s but one choice.
“The only option is a share plan,” Niederman said.
Insurance regulators are working to bring short-term carriers back into the market. But there are other market challenges, as well.
Back up in Eagle County, Kaiser Permanente has announced it is pulling out of the county at the beginning of next year. That means there will be hundreds — maybe thousands — of people scrambling for coverage to begin in 2020, with only one insurer, Anthem, offering plans in the individual market. Romer said he hopes the recently created reinsurance program and a forthcoming plan for a government-run public insurance option will all provide relief, either now or later.
But realistically? Despite all of the risks and despite all the warnings from state regulators, there will still be a place for a cost-sharing program.
“We don’t think it’s going away,” Romer said.
“Although,” he paused briefly, “we do hope that fewer people will need it.”