Rebecca and Liz explore health care sharing ministries with guest, Sarah Levin. Sarah guides us through this religious billion dollar industry. We discuss what HCSMs are and what they are not, and why we need to push for them to have transparency.
Background and Resources
Sarah’s email: sarah@secularstrategies.com
Last Week Tonight with John Oliver (HBO) – “Health Care Sharing Ministries"
Rebecca Markert: Welcome to We Dissent the podcast with secular women attorneys discussing religious liberty issues in our federal and state courts and our work to keep religion and government separate. I'm Rebecca Markert with Americans United for Separation of Church and State.
Liz Cavell: And I'm Liz Cavell with the Freedom From Religion Foundation.
We are so excited to have Sarah Levin joining us today to talk about healthcare sharing ministries. Welcome to our show, Sarah!
Sarah Levin: Thanks for having me. I'm such a fan.
Liz Cavell: This is exciting. Sarah is a very old friend, long time secular movement activist and comrade, so this is great. And this whole show idea has been long time in the making. Rebecca has been trying to put this one together for a while.
Rebecca Markert: Yes. I've been dying to bring you on the pod, Sarah since forever, but also since I heard you speak on this topic at the summit for Religious Freedom in DC this past April. Before we get to that topic, however, let's give you a proper introduction.
Sarah is the founder and principal of Secular Strategies where she leads a team that empowers policymakers, lawmakers, and change makers to be effective champions of secularism in the United States. She also represents the secular community as a co-chair of the DNC Interfaith Council. But Liz and I met Sarah when she worked for the Secular Coalition for America, where she was from 2013 to 2019. At SCA, she was the director of grassroots and Community Programs and then director of Government Affairs. Prior to joining the Secular Coalition, Sarah completed a year of AmeriCorps service. Which I think you also did, Liz.
Sarah Levin: Hey Americorp.
Rebecca Markert: She holds a bachelor's degree in international studies from the other AU, American University, where she served on the leadership board of the University's Secular Student Alliance affiliate. And I just have to say, Sarah, that your work at SCA helped facilitate the coordination of the secular groups in a way that I think really truly made us work better together than ever before. It also led to a lot of different collaborations including the annual secular litigators round table, and dare I say this podcast, Alison Gill and I met at an SCA conference and we had a lunch that launched a lot of our joint legal work and a lot of ideas that we wanted to work on together. And so I think that you can count yourself as a part of We Dissent history.
Sarah Levin: Oh my God, that's such an honor. Thank you.
Rebecca Markert: And you were also one of our very first fans. I remember you shouting us out and saying that you were all excited about this podcast, so we're so happy that we were able to make this happen finally.
Sarah Levin: Me too. And I have to just quickly say, I just feel like there's such a lack of appreciation for the women in this movement. There's so often a lot more spotlight put on male leadership as there is just in general in the world. And so when a podcast came out where it's all the badass secular women attorneys, I was like, hell yeah, this is amazing. Because I knew all the women who were doing the work and I felt like nobody knew their names and what they were doing and had only heard of a handful of usually white men who maybe had a big social media presence but weren't necessarily the only people doing the work. And there's a lot of really amazing talented women that often are behind the scenes or even not, but then nobody knows who they are. So such a fan of the podcast and the content, but also just the idea of raising the profile of the badass women in the secular movement.
Liz Cavell: Thank you, Sarah. That is exactly the idea is that you too like us, have been working as a secular advocate in this movement one way or another for most of our careers, 10, 15 years now. We work with a lot of great people all over the spectrum and many great men too. You're great, we appreciate you, but there are just a lot of amazingly tenacious women that are doing a lot of the work of the movement that are leaders in the movement, but sort of unsung. And again, partly in the atheism space, but also in the broader secular movement, there has just been this dominance of the kind of atheist bro cultural dominance.
Sarah Levin: We all know him.
Liz Cavell: We do. And so yes, as part of the podcast is to sort of tease out some of the really cool different people, points of view that exist actually like slogging through year after year, trying to protect our secular republic. So you're definitely a part of that. So this is such a great gush fest.
Sarah Levin: Gush fest. I love you guys. I'm a fan. I'm not ashamed to say it.
Rebecca Markert: So let's get to more serious topics. Although the love for elevating women's voices is a wonderful topic. Today we are going to talk about healthcare sharing ministries. And this was an issue that I think came to a lot of people's attention when it was a feature on John Oliver's Last Week Tonight's show, John Oliver covered this in 2021.
John Oliver, "Last Week Tonight": That ad is for something called a healthcare sharing ministry. And if you haven't heard of them before, you may have come across one and not even realized it because they have been growing fast in the US.
Rebecca Markert: So four years ago it was shared widely at that time and it was talked about a lot, but so much stuff has happened since then that I really think it's time to bring this issue to light again. And so for our listeners, would you be able, Sarah, to explain what healthcare sharing ministries are and more importantly, what they are not?
Sarah Levin: Absolutely. So a healthcare sharing ministry is a tax exempt organization where members follow a common set of religious or ethical beliefs and they contribute a payment or what they call a share to cover the qualifying medical expenses of other members. And there's a big asterisk with qualifying medical expenses that will get into in a second. But basically healthcare sharing ministries, and I'll say HCSMs for sure, they match paying members with those who need funds for their healthcare costs or they pool all of the monthly shares and then administer those payments to members directly. So if that sounds like health insurance, there's a reason it sounds like health insurance because it is an insurance like product, but it is not health insurance because unlike health insurance, and we'll go into many, many of the things that distinguish actual real health insurance from healthcare sharing ministry plans, but the most important thing to understand I think, is that they don't have to pay you anything they might have. And they do have contracts that explain what they will cover and what's a qualifying medical expense.
But you will find in the fine print of any healthcare sharing ministries that they have complete discretion to deny you a payment and they don't have to do a lot of things that insurance companies have to do. Insurance companies are very heavily regulated. I think that's also something that's important to listeners to think about. Not every industry has an entire department in every state dedicated to regulating that industry. There's certain industries like banking, like insurance that a long time ago our government recognized this is so complicated and also very important and difficult for consumers to navigate that we need to have a dedicated state agency that regulates the specific industry.
And insurance is one of them. Every state has a department of insurance. It is complicated even for people who are in, one of the associates I work with has been a lobbyist for the insurance companies and knows it inside out. And he will even say I'm pretty savvy and even I find it complicated to navigate. So that's why we regulate insurance products and we'll get into this later, but basically these healthcare sharing ministries operate very strategically in a gray area where they're not insurance but they look like insurance and they market themselves like insurance. But because they are literally not insurance, they aren't regulated in the way that insurance companies are. And I should say I am in no way, shape or form going to say that our insurance industry is great or that it's working well. We all know and have experienced how the problems with our healthcare markets in the United States, but with all of those problems, there are actual guardrails.
Insurance companies have to prove that they're solvent. They have to set aside funds to make sure they can actually pay people out. There's something called a medical loss ratio where basically insurance companies are required to spend 80% of their profits, their revenue on medical expenses to providers and patients. They can only keep as profit or for overhead 20%, which you might argue, and you could make the argument that that's too high, but there's no such thing for healthcare sharing ministries. In fact, we've seen that in some cases it's like the opposite. They're keeping as much as say 60% in profit and that's just going into the pockets of the companies. But they're actually not even companies, hey're tax except nonprofits. That
Liz Cavell: Part's wild.
Sarah Levin: Yeah, there's a lot going. So I hopefully answered the first question I got a little too in the weeds there, but that's basically what they are. They have a different structure and in some cases they pool it and do the direct payments and other cases they're putting out asks to their members of whether they would consider covering another member. So they all operate a little bit differently, but it does feel like insurance, it's just not. And that common set of religious or ethical beliefs is really key. And I don't want to get too in the weeds here, but there is a federal definition of a healthcare sharing ministry. And that came about because there was a specific carve out for healthcare sharing ministries when the Affordable Care Act was passed and the healthcare sharing ministry industry lobbied for an exemption from the individual mandate at the time. And that's where that definition came out.
Liz Cavell: This is so interesting. So we, through our work at our organizations and particularly at FFRF, our 501(c)(4) arm, has been focused more on lobbying around HCSMs. But this makes sense because their styled as a ministry and the whole point is to operate outside the system, but it's only now striking me as you're saying that they're tax exempt nonprofit organizations. So given that, can you describe a little bit more how they're structured, how they come to be? Are they like churches where it's just like, poof, we exist, we don't file any tax paperwork and we're even more not financially accountable than your average nonprofit. Do they tend to do what our nonprofits do and file forms 990? How big is the lack of transparency in this industry and how are they structured beyond just their nonprofit status?
Sarah Levin: So just to start going a little bit farther back, when healthcare Sharing Ministries first came into existence, they were primarily serving really insular religious groups. So the Mennonites for example, or the Amish. And what's happened and what's made this kind of a much larger problem in recent years is that basically people figure out that you can make a lot of money in this. And it's been now marketed much more broadly to a broader secular audience. And so the marketing really depends on, and I've heard their lobbyists talk about this like, oh, we're not hiding anything. If you look at our website in the fine print, it says that we're not health insurance because they're depending on the fact that most people don't read the fine print and they know that their marketing makes them sound like insurance. So that's kind of the larger issue.
And it's interesting now there's even healthcare sharing ministries that talk about the fact that they're not religious. They kind of emphasize those ethical beliefs and saying they're secular. So there's both versions. But to your question about how they're structured, some of them are directly related to a specific church, but most of them are, they're 501(c)(3)s nonprofits that file form 990s. And those 990s are pretty much with the exception of what we found from journalists, what journalists have uncovered or from lawsuits or from certain states that have required more information. It's a total black box. And so that's part of the work that I've been doing on behalf of the Center for Free Thought Equality, which is the advocacy arm of the American Humanist Association. Our transparency bills are largely trying to answer a lot of your very good questions. How are they structured? Some of these things are like what is their org chart? How much money are they pocketing? How much are they paying out? A lot of that information, we just don't have it. We have maybe a 990 and that's it. And we know from the 990s that these nonprofits are bringing in over a billion dollars in revenue.
Rebecca Markert: It's a billion dollar industry.
Sarah Levin: It's a billion dollar industry.
Rebecca Markert: So insane.
Liz Cavell: So let's kind of move on to what regulation, if anything at all exists for these HCSMs because it's really weird they're operating like nonprofits and you're saying many of them or most of them are compliant with the tax exempt paperwork side of that, but most of us nonprofits are not functioning like insurance products. So is there any type of insurancey regulations that in any way apply to these organizations at all? For example, do we know how much money and claims they pay out? Could you compare their revenue to the money they spend on actual healthcare?
Sarah Levin: So there are a very small handful of states that have taken steps to actually regulate these. Massachusetts is one, California is one. It can go a little into Washington State and they vary in terms of their approach. And in addition to that, there have been cases where both State Departments of Insurance and in some cases attorneys general have taken action against specific healthcare sharing ministries. Usually a big one that there was a spate of cases and an action from both AGs and state departments of insurance was with Aliera, which was the worst of the worst. And that's the thing is that this is a really smart talking point that the industry's lobbyist will say is like, oh, you already have the tools to deal with the bad actors, so we don't need any more transparency. But the problem with that and why that's like a total red herring is that when healthcare sharing ministries cross the line and lie to people and say that they are insurance when they're not, then an attorney general using the state's consumer protection law or State Department of Insurance can say, you are basically an unlicensed, you're selling insurance but you're not licensed.
But what the industry has gotten really good at is getting right up to that line so they can't be accused of lying to people like, well actually it says it on our website and in the fine print, we never said we were health insurance. So that's actually the bigger problem that we're trying to tackle is the industry got really smart, especially in the wake of all those cases and they know exactly how to not cross that line and operate in that gray area. So in addition to those handful of states, Washington State, Massachusetts, California, there is one state that has taken legislative action and that's actually what we're modeling from in our other bills, and that's Colorado. Colorado just a few years ago passed a law that required healthcare sharing ministries to start reporting some very basic information. And I should say this is a fraction, tiny fraction of what insurance companies have to report to the State Department of Insurance.
It's very basic stuff like what you mentioned, how many people in Colorado are enrolled, how much were submitted in claims, and how much were actually paid out, who works for these organizations? Very basic information. And the industry sued them and there's a pending lawsuit because they're of course making First Amendment arguments that this is an undue burden on their religious freedom. And the thing that's really important about that transparency law is that it requires healthcare sharing ministries that are operating Colorado to also report what other states they're operating in. And for those that complied because not all, especially after the lawsuit, a number of them decided not to comply with the law. That is the only reason that I can go to a legislator in Oregon and say, Hey, there's at least this many operating in your state, and I only know that because Colorado passed this law.
And there could be more because either there might be not complying with the Colorado law or there might be some that operate in your state, but not in Colorado. A lot of the conversations I have with legislators is them asking a lot of the questions you're asking me and me saying, that's a great question and I would love to answer that, but I can't because they don't have to report anything. This is the only information I can share with you. And the only reason I have it is because Colorado passed a transparency law. So to your question of regulation, a lot of the regulatory actions we see is whack-a-mole, like responding to complaints that come in from consumers and then going after the bad actors. But with very few exceptions, there's not a regulatory framework. And it's this really interesting thing where some state departments of insurance are saying, yeah, this is really bad, but it's not in our jurisdiction because they're not insurance. But we're saying this is a product that involves transfer of risk, right, That's what they're offering.
So they may say they're not health insurance, but this is an insurance-like product. And certainly from the consumer's perspective, we know that a lot of people are buying these plans and don't know what they're buying. We're not trying to get rid of the industry. We're just saying if you buy a healthcare sharing ministry plan, you should know what you're buying if you're fully informed and that they have all of these restrictions, which we haven't even gotten into the waiting periods, the preexisting conditions, all those things. All those things, and you know that they can deny you for any reason and you're still willing to do it because you share their beliefs or you're like, you know what? I'm just going to take the risk cheaper. That's fine. You're making an informed choice as a consumer and taking on that risk. That's not what is happening for a lot of people. People sign up thinking they have an insurance plan and then when they get saddled with massive medical debt and their claims aren't being paid, they find out that they don't have health insurance. And guess what? There's nothing that their state Department of insurance or ag can do for them because they basically just signed a contract with a nonprofit and bought a product that isn't regulated by their state.
Rebecca Markert: So how many Americans actually subscribe, HCSMs,
Liz Cavell: Keeping in mind that we don't have, nobody's required to keep these enrollment numbers. Do you have any sense?
Sarah Levin: I have some numbers and then the caveat of like, but we don't really know.
Liz Cavell: In terms of the harm, because this is clearly so predatory, but in terms of the scale of the harm, how common are these plans? I suspect they might be more common than I think, but where are consumers coming across these plans? It makes sense in the insular communities that you're talking about where it's like we are take care of our own and we are a Mennonite closed community and this is everyone don't get insurance, we're going to do this other thing. But that's not what's happening. These are products being marketed like products to the public.
Sarah Levin: So that's a really good question. So I'll start with just the numbers we have on how many people impacted and then how they're being sold. So there is a lobbying group that represents not all. This is just one portion. There's some of the biggest healthcare sharing ministries are not even part of this alliance, so it's just a fraction. So it's called the Alliance of Healthcare Sharing Ministries. They report that over 692,000 Americans are members of HCSMs and 250,000 households. That's what they're reporting. But also I know for a fact that because I talked to the original sponsors of the Colorado law that what the Alliance was reporting for how many Coloradans were enrolled before the law was passed, that number went way up after they had to report. So it was an underreporting. I've also seen an estimate of 1.7 million as well, but it could be so much more because again, they don't have to report in every state. So they are marketing themselves online and they are also, these plans are getting sold by brokers alongside actual health insurance plans.
Liz Cavell: Aren't those brokers regulated?
Sarah Levin: They are, but–
Liz Cavell: By the same insurance commissioners type schemes that regulate the industry?
Sarah Levin: Yes, but, and so this is actually interesting. This is one of the things that Texas of all states actually took some action on this. So one thing that we've seen states do is issue advisories or basically reminding brokers of their liability and that they're not supposed to sell unlicensed products. But again, there's this whole gray area, right? Because there's this idea of what is a legitimate legal HCSM according to the federal definition, and then whether the state is going to use that definition or not, because it's not illegal. There's nothing illegal about selling a healthcare sharing plan. So a broker is technically not, like if they are selling a plan that is not illegal to sell in the state, they're not necessarily doing anything wrong. Now, if it's something that the state wouldn't consider a healthcare sharing ministry plan, then maybe there's a cause for action there if it's even been raised to that level where they're actively engaged.
Because a lot of times we're just seeing states being very reactive to cases coming up. So this is not always necessarily on the radar, especially for legislators, but state departments of insurance know about these things. But there's these big questions of what is a legal and legitimate HCSM versus what is not? And again, the industry has gotten very good about operating in that area. So if they're operating a legitimate healthcare sharing ministry, that is not illegal to sell in the state. The broker's not doing anything wrong. But one thing that California did that's really smart and helpful is they actually did promulgate a new regulation specifically for healthcare sharing ministries as it applies to brokers, where brokers have to provide a comparative analysis for a consumer as they sell it. So they have to tell them, this is what the plan has versus your other options, and this is super important. They have to let them know if they're eligible for state subsidies or free insurance from the state because that's a huge thing that we learned from the Government Accountability Office. They issued a report that found that of the sampling. Again, this isn't like all of 'em in comprehensive, but the sampling of healthcare sharing ministries that the GAO looked at the GAO report found that more than 40% of one healthcare sharing ministries members had annual income below 200% of the federal poverty level. So–
Liz Cavell: That is so upsetting.
Sarah Levin: That's super upsetting. And that's just one anecdote. So it leads you to question how many people are getting signed up for these plans who are actually eligible for freer subsidized healthcare? And listen that healthcare, how hard it is to get enrolled, especially now with new work requirements, all that stuff. I'm not saying that's easy or that it's particularly good, but at least you have the protections of the Affordable Care Act because this is a huge difference between actual insurance and HCSMs. Thanks to Obamacare, we no longer insurance companies can't deny you based on a preexisting condition anymore. They can't impose waiting periods and they have to cover certain things. There's essential health benefits. None of that applies to healthcare sharing ministries. And so we see all of those things in those contracts. So pretty much out the bat, most of them are not going to cover abortion, contraceptive care. A lot of them aren't providing payments for addiction recovery. If I could just quickly, this is just one contract, but I have it right in front of me. This is Universal Health Share, which is pretty large HCSM. They have in their language, this is a preexisting condition basically for a hernia. So a hernia is generally shareable, but during the first 36 months of membership, a confirmation of no prior existence of conditions statement may be required. So, that's a hernia as a preexisting condition.
Liz Cavell: This is the kind of thing that no insurance companies can do any longer since the ACA. So are HCSMs completely exempt from every component of the ACA? There's nothing regulating them.
Sarah Levin: Yeah. And here's another one. This is like you would never find this in an insurance contract because of the Affordable Care Act. So this one is saying that HIV/AIDS, STDs are not covered. It says we do not share needs for sexually transmitted diseases, including the HIV virus and or AIDS when contracted through irresponsible behavior such as sharing hypodermic needles for legal or illegal drugs. It is the member's responsibility to explain how the disease was contracted.
Liz Cavell: So I'm really curious about this component of things. The cost sharing or sharing needs as the lingo goes, revolves around in large part this religious moral judgment of the ministry. I'm eager to explore sort of how these products are being marketed to people. It's really hard to imagine how they're getting these potentially 1 million plus enrollee numbers while also being honest about the fact that coverage revolves around these really narrow religious or moral judgments on behavior. How does the marketing of these products compare to what they actually are? Are they being marketed as like,"Hey, leave the secular evil world of insurance and come join us, your brothers and sisters in Jesus Christ, and we will share our healthcare costs in this moral path." I feel like that would be more of a clue that you're not getting an insurance type product, but it feels like there's more predation going on than that. They're trying to capture a wider, and the fact that those numbers you gave on the income levels, it's like this is clearly just like your typical predatory financial product. You're going after people who can't afford insurance and just trying to scam them out of a bunch of money and scale that up to a billion dollars. That's what it is. So how is this marketed? Do the people that buy it in general, are they surprised when they learn that this is actually all moral judgments when it comes to getting reimbursed or getting expenses covered?
Sarah Levin: Yeah, I mean, the thing is they're not leading with that anymore, maybe are when they're talking to an insular, a religious group. But the reason that the amount of people enrolled in these has ballooned is because they're being marketed in a secular way where they tuck away the fine print. Again, this is also part of what the transparency bills are about is because the Colorado law required HCSMs to submit their marketing materials. So now we have some clues as to how they're marketing themselves. I have in front of me right now, one of the training materials for their staff where it says, say this, but don't say that. So instead of saying deductible, say primary responsibility amount, instead of saying copay, say provider fee instead of benefits say provisions. Why are they doing that? Because they want to be able to have enough plausible deniability to say, "Hey, we're not even using insurance words." So there's that aspect of how they're skirting the law. But then if you see some of their commercials, there's one that will show in a second that's Liberty Health Share, and it shows images of young people being super active and it's offering a plan for $119 a month.
Rebecca Markert: Let's play the audio from that commercial.
Liberty Health Shares Commercial: If you are 18 to 29 and looking for affordable healthcare, Liberty Health shares, Liberty Rise is only $119 per month. You can share your eligible medical expenses, including hospital stays and urgent care, liberty health share, discover the power of sharing.
Sarah Levin: That they're talking about covering urgent care and all your basics. And it's super obvious that they are trying to target young and healthy people who can't afford high premiums and think they're not going to really need a lot of coverage. They just need the basics. And I get my insurance off of the California Health Exchange. I can tell you, you cannot find a plan that's 119 a month. It's really competitive. If you think it's insurance and if you watch that commercial and you listen to it, there's absolutely no way that you would know that it's not health insurance. And sure, there's a cross in the Liberty Health Share logo, but there's also real insurance that's also sold by religious organizations. There's a lot of Catholic plans. So seeing a cross is not going to trigger that alarm bell of, oh, it's not health insurance.
And even then that's a whole nother thing. A lot of people don't even know that if you have Providence or you have one of these, they may not cover certain things and that's a problem in its own, but at least they are subject to essential health benefits. And the A CA and the commercial at the very end has this tiny, tiny print at the bottom that says that Liberty Health share is not health insurance. But first of all, if you're seeing that online or on tv, how are you going to read that on your screen for half a second? That's impossible. And it's clear from when you watch that they're clearly not required to do what pharmaceutical companies have to do that the end of a commercial about a drug where someone in a very pleasant voice listen to all the things that can happen,
Liz Cavell: You may experiences this, that, and the other thing.
Sarah Levin: Yeah, clearly I don't think those companies want to have to do that, but it's clear that they're required to.
So healthcare sharing ministries don't have to do that. They just put it at the bottom of the, so I actually, I think between brokers and these online ads, they're just marketing it and leading with the cheap prices and all the things you can cover, and then they do just enough to cover their butts. And then a lot of people think they're buying a health insurance plan. I can tell you that Vermont Legal Aid, because working on a transparency Bill and Vermont has said and shared with the health committee, we get calls on a regular basis from people who are trying to get help with denied claims. And then we look into it and it turns out they have a healthcare sharing ministry plan, but the person calling thinks they're calling about their health insurance company denying a claim. And guess what? There's nothing that can be done at that point.
Liz Cavell: Health care sharing ministries are doing this in a way where it's going to escape your notice. It's in this fine light colored print at the bottom of the screen that you basically can't even see or read. It just wouldn't get your attention because you're seeing these visuals of young active people doing things and you're seeing the low price flash on the screen and all that jazz. And so if you're just listening and visually looking at the kind of graphics and the people and the big numbers, you're not hearing anything that's flagging your attention for any kinds of risks. When you hear those pharmaceutical companies, I'm hearing these side effects. I'm hearing the regulated thing. I'm hearing the thing that's meant to protect me and think twice and have pause, and you don't hear that because it's not there. And the whole point is to have it escape your notice. All you see is that low price and that glossy video and all you hear is "buy this product. It's so cheap. It's all you need."
Sarah Levin: And maybe in some ways, because we've come to expect that you hear that little part at the end of a radio ad or on tv, in some ways I wonder if the lack of it kind of almost is legitimacy in and of itself because if it was something that required a disclaimer for you to hear, it would probably you would hear it. And that's something I really love about the Oregon transparency bill, is it actually speaks to that. It does talk about how they market themselves and specifically says if it's an audio only, there has to be a conspicuous sound or they have to have the disclaimer as loud or louder than the rest of the announcement. That's not something that even the Colorado law doesn't address. And I think it's necessary because the industry, when they were testifying against the Oregon Transparency Bill, were talking about how we really encourage our consumers to do their research and read the contracts. And they were talking about go look at our 990s, go look at our audits as if they're so transparent. And I'm like, in what world should the burden be on a consumer to look up a financial audit? And your 990s, the burden is not on the consumer. They're trying to make it sound like, but all this information is public and we totally encourage you to look at it, but that's besides the point.
Liz Cavell: Again though too, Sarah, these aren't donors looking to make donations. It's apples and oranges. Go look at my 990 and then you'll feel comfortable buying my insurance product. It makes no sense. It's just an apples and oranges situation where it's like, how is a person in the market for basically to replace health insurance going to be helped by the type of transparency that 501(c)(3)s provide? Because that's geared towards donors and just showing where donation dollars are going in terms of programs and overhead and things like that, and reserves that has nothing to do with insurance and what you need to know about an insurance company to know if it's a safe product for you to buy. It's just so frustrating that these religious actors just have created this total outside the law industry that they get to operate in and prey on people. It's not even like they're just hurting their own followers. It's like they're predatory and they're preying on people. And as usual, it's like the most vulnerable people that are probably really harmed by these ministries when the time comes to get payments or reimbursements or expenses covered. It's just sad.
Rebecca Markert: Well, I want to take that and shift the conversation to some of these real life examples of what happens when people sign up for healthcare sharing ministries because it sounds very deceptive, it feels criminal. And as you mentioned earlier, Sarah, a lot of people will call their consumer protection offices in their states trying to figure out what can be done. I feel like I got scammed and I suddenly have a lot of medical debt and there's no help out there. So I just wondered if you could share some of these stories about people who signed up for a healthcare sharing ministry, got some sort of horrible disease, and then were sacked with thousands, hundreds of thousands of dollars in medical debt.
Liz Cavell: After paying $120 a month for who knows how many months, because again, these people think they're paying into something. That's the whole point.
Sarah Levin: So I can give a few, and unfortunately there's a lot. So this is an example from 2020. A Georgia family got stuck with a $325,000 medical bill that their HCSM refused to pay, and it was for brain surgery for their 10-year-old child who was rushed from the local ER in Green County by ambulance to a children's healthcare Scottish Rite where doctors removed a brain tumor and they were stuck with the bill.
Another example was in Washington State, there was a cancer patient, his name is Brad Fuller. He signed up for what he thought was health insurance. He was paying $390 a month. A few months later, he started having health problems, teeth and jaw pain, and one night, he started coughing up blood. So he went to the ER at Evergreen Hospital in Bellevue, and he said that night he almost died, and then he was told his insurance doesn't cover him for cancer. And the bill he got just for that week's stay in the hospital was over a hundred thousand dollars and he got zero dollars paid out from the HCS.
Liz Cavell: So can I just interject real quick, Sarah, how do we know those stories?
Sarah Levin: From journalism, from just getting caught up in the news. There's so many stories we don't know because they weren't discovered by the news. Because if you think about it, a lot of people in these kinds of situations often don't even know who to call or assume no one's going to help them.
So, even if they know that, oh, there's a consumer protection group that I can call, or I should file a complaint with my state department of insurance or my attorney general office, that's already such a small slice of people in this situation. But when they do, again, unless in some cases it's an HCSM that's illegally operating or lied about being insurance, there's nothing that could be done. And there are attorneys and law firms that we've talked to that have filed class action suits. And what ends up happening basically is HCSMs just declare bankruptcy. So even when they have a success, they're chasing the money. And there's been some successes in the cases, but not a single penny paid out to anybody harmed. One of the attorneys I've talked to, she was like, my first case on HCSMs is going to be my last, we're still wrapped up in the courts.
There's no way I'm taking up another case like this because it took so many years. And she told me point blank, bankruptcy court doesn't know what to do with these things. They're basically, they have that out. So there's really no restitution. The only way we know about these stories is when they make it into the news or there's complaints. If you go on the Better Business Bureau website, you'll see lots of complaints there as well. But again, where does that lead us? So that's why we're really trying to fight for transparency in the states because we learned so much from Colorado and it did have an impact. There are healthcare sharing ministries that stopped operating in the state, and then knowledge is power. It doesn't stop them from operating necessarily, although it does have a little bit of a chilling effect. But we want legislators to know about the scope of who is impacted in their state because I can tell you the vast majority of legislators that I've talked to don't know what these are.
Most of the time I have to go from the very basics, what is an HCSM? And when I tell them that there's at least 7, 8, 9 or more HCSMs operating in their state, they're shocked. It's a total black box. And I think because people don't get in this situation and they don't even know who to call, that's why it's so scattershot. But there has been rolling national news coverage on this. In fact, in January of this year, NBC published an article about a bunch of different stories, and I can send you guys this for the show notes about specifically pregnant women who were signed up for a healthcare sharing ministry plan only to find out that there's waiting periods and none of those costs were going to be covered. And that actually checks out with, there was a state department of insurance in a state that told us that they had heard from local providers that had let in HCSM reps to their maternity clinics not realizing what was happening.
And then pregnant women in those clinics got signed up and then found out. So it's predatory that totally checks out. They know that people won't read the fine print. So that's a great target, a pregnant woman who's not going to qualify for anything. And then you can say, well, you signed the contract that says right here that there's a 12 month waiting period for maternity care, or here's an example, Zion Health Share. They have a seven day waiting period for newborns to be enrolled in their parents' plan because again, they know how expensive, the first few days will be. Yeah, this is really intentional.
Rebecca Markert: That's what is also so infuriating about it. It's so predatory. It really does feel like a crime. They are legitimately scamming people. And the answer right now is, oh, you should have read the contract. Oh, go to our 990 and you should have known from that tax document that laypeople and even lawyers sometimes don't even understand. And all of this should have been known to you. And it feels like we're expecting this level of sophistication and education from people who are in crisis. Like a 10-year-old daughter is sent to the emergency room to get a huge tumor taken out of her brain, and you're like, you should have known. Sorry. Those are horrible, awful stories.
Liz Cavell: I know the answer, Sarah is like, we don't know. They don't tell anybody anything. But what is the justification for denying covering those expenses like a kid's brain tumor, just these blanket exclusions. We don't cover cancer. We don't cover anything expensive. It's like the battle days with insurance before the ACA. And it's almost like it's better for these HCSMs now that the ACA exists because everyone's lulled into this false sense of security that no one would sell a product that excludes the first seven days of my newborn's life. That's not legal. We don't live in that world anymore or preexisting conditions. Oh, we don't live in that world anymore because it's been however many years, 20 years since the ACA was passed. It's taking advantage of the fact that we have, yes, it's by no means a good or even remotely defensible healthcare system that we have here, but it's so much better than it was 20 years ago in terms of what insurance companies can and can't do.
And it's the perfect environment for these HCSMs to just hoodwink vulnerable people into believing that you don't have to worry about those types of things. So just like when we agreed all terms and conditions and signed contracts on everything, it's like you're just skimming. You're assuming that the market protections that are the norm are going to protect you, and they know that, right? That's the whole point of having all these exclusions in the contract that mimic all of those exclusions that used to make insurance companies boatloads more money before the ACA. It's so insidious. I mean, maybe there's some healthcare sharing ministry out there that's operating in a super consumer supportive way, and all the enrollees are happy with their coverage, but I can't see anything other than a Ponzi scheme. They're just collecting money from all the enrollees and then maybe paying small claims here and there. But ultimately it's always a losing proposition. You're never going to make more money than the house because they can deny anything. It's like, oh, you've paid out $10,000 over the life of your plan, but you have this $300,000 hospital bill. It's not covered. There's never going to be a time when you could ever come out on top in terms of the risk shifting and sharing. And that's just a scam. I mean, that's just a total scam.
Sarah Levin: And I mean, all the contracts vary. I mean, there's certain exclusions are going to see in most of these things like abortion that are coming from a religious perspective. But I think it's important to remember that whatever the exclusions are for what's eligible for sharing in a contract is kind of almost irrelevant in some way because they can deny you for any reason at any time because there's no guarantee of payment, period. So even if cancer is an eligible sharing expense, that doesn't matter because they could still deny you. They still have the discretion to do that regardless because it's just too much money. And the thing is, it's not like they never pay at all. So they have all these stories of people who have the positive anecdotes because they don't pay zero. So sure, there's probably plenty of people who don't have a catastrophic event and they get their things reimbursed and they're happy with that.
But there's also people who get completely screwed by this system, and most importantly, a lot of people who don't realize that they don't have health insurance. I don't think the number that we're seeing, and it's probably very low. The 1.7 would be so high if every single member was fully informed about the risk that they're taking, and they are totally taking advantage of that and operating in this gray area. And one of the things that the industry has done is they've lobbied very successfully for what we call safe harbor laws. Many states have a law that basically says healthcare sharing ministries are not health insurance. That's it. They did that on purpose because the last thing they want is to be considered health insurance because then they can be regulated. They don't want to be regulated. They don't even want to provide a fraction of what insurance companies provide in terms of basic information. And it's really interesting. You made me think, Rebecca, when you were talking about this sounds criminal. Some of these healthcare sharing ministries are legitimately run by people who have been previously convicted of fraud.
You don't, oh my gosh. There's language in some of these transparency bills that requires information about background and fingerprints and any previous convictions of fraud of the people running these. That's no accident. There is one healthcare sharing ministry that actually has supported transparency because they're like, we have nothing to hide and we think this is great for us. So it's not like every single one of them is a bad actor. There is a world in which they're like, this is what we are. We're going to tell you what we are and we stand by our product. But that is unfortunately, there's only one that supports the transparency, and largely there's a big pushback because they don't want to share that information. If you have such a great product, why wouldn't you provide basic information like that to the state?
Rebecca Markert: Right. Are you able to share which healthcare sharing ministry that is?
Sarah Levin: I am. The name of it is called Christian Health Ministries.
Liz Cavell: Okay, good on them.
Sarah Levin: Yeah, basic transparency,
Liz Cavell: Sarah. So you mentioned Colorado as kind of the model for states that are successfully trying to take on some sort of accountability or transparency. Have there been any federal legislative efforts on this front to reign in this industry or regulate them at all? And also, can you tell listeners about legislative efforts to make HCSMs worse and give tax breaks to them that further support the industry? Because I'm sure they have a lot of support in certain political corners.
Sarah Levin: Yes. So the federal effort has been led by Congressman Huffman and it's called the Health Share Transparency Act, and it does a lot of what the Colorado bill did and a number of other things in terms of involving relevant federal agencies. But given the state of our politics and Congress not getting a lot of things done, I think it's a great bill, but it's also just probably not going to move anytime soon. But it really does. It's important because it does shine a light on the issue at the federal level. And then we got bills introduced in transparency. Bills model from Colorado, they all vary a little bit, but same core cons of transparency in Oregon, Vermont, New York and Minnesota last year, and we're going to continue to fight for those bills to pass. It takes time. Usually you don't get a bill passed into law in the first try, but we had a lot of success with just educating legislators about the issue, getting an informational hearing in Oregon.
And really what we're focused on now is actually trying to find those personal stories because it is difficult to find the specific people who are impacted. And that's really important. You really can't understate how important it's to have personal stories when you're trying to fight for legislation. And so this is where we're at a disadvantage because we don't have this data. We rely on what journalists have covered, and legislators don't want to hear about the guy in Georgia or the child in Georgia or the guy in Washington state. They want to hear about the people in their own home state. So we're really trying to find people who are willing to tell their story so that we can make the case for it. Because there are some legislators who just don't believe that it's a problem or because they haven't heard from people about it. But again, obviously it is. But the amount of people who are going to be like, let me call my state representative about this problem that I have. I feel like the amount of conversations I've had with people who have issues, including my own family with an agency, I'm like, Hey, have you called your member of congress or your state rep? And they're like, why would I do that? I was like, because they have constituent services and that's their job. And they're like, I didn't know that. Right? People don't know about constituent services. So the idea that like, oh, I got screwed by this thing and now I'm going to call my representative and tell 'em about it, or I'm going to file a complaint with my state department of insurance. That's just, unfortunately people don't know to do that. So a lot of times the stories we do get, they just come from reporters.
I do need to pull up one other thing to answer your other question, which is on the other side, what they're lobbying for. So some of that I can do from memory.
So I would say first Trump administration, and we expect the same in the second term. They're very favorable to healthcare sharing ministries. And in his first term, Trump issued an executive order calling for the IRS to basically to allow for deductions of healthcare sharing ministries as expenses, which is really interesting because basically what they want to do is they want to treat them as insurance in the tax code so that you can deduct them as medical expenses, but they don't actually want to in other parts of code, treat them as insurance because then they could be regulated. So they want to have their cake and eat it too. The woman who testified in opposition to our transparency bill in Oregon, the lobbyist for the Healthcare Sharing Ministries Alliance, she served on Trump's domestic policy council in the first term, Katie Lento.
So very strong ties with the industry. So the first executive order in the first term, it was Executive Order 13877 improving price and quality transparency in American Healthcare to Put Patients First. That's what it was called. That was issued in 2019. That directed the IRS to propose regulations, allowing expenses related to certain arrangements, including HSMs, to qualify as legible medical expenses under the tax code. President Biden then rescinded that order in 2021, and then the IRS proposed a rule in 2020 aimed to redefine insurance in the tax code to include HCSMs, which would allow employers to reimburse employees for HCSM membership fees. And the rule also encouraged other types of non ACA coverage including health reimbursement arrangements and direct primary care arrangements as well. But the rule wasn't finalized before Trump left office, and there was a lot of criticism, so it stalled and was never finalized under the Biden administration.
So that's previous. Now there's legislation that was introduced by Mike Kelly, a Republican from Pennsylvania. It's called the Healthcare Sharing Ministry Tax Parity Act, HR 8776. And just like that first executive order, it pretty much implements that by allowing HCSM members deduct their membership expenses as medical expenses on their taxes. So we're kind of just waiting to see what happens. We haven't seen anything other than that legislation come down, but we can certainly expect that given how close Trump is to the lobbyist for the industry and his just like utter rage against the ACA and his inability to repeal it. So yeah, I would definitely expect more activity on that part, but that's what we've seen so far.
Rebecca Markert: Sarah, this has been incredibly enlightening, if not horrifying, but one of the things when we have guests like you come on who are active in a particular space or on a particular issue, we always want to give some sort of call to action for our listeners who might equally be enraged about what they've just heard. So is there anything that our listeners can do to help these efforts to get more transparency? And where can they go to find out more?
Sarah Levin: There's a lot that they can do. So first of all, there might be people in your life that have one of these plans and don't realize it or who might be susceptible. So the first thing is to not underestimate the power of educating. Literally just have a conversation with your family and friends. Send them the John Oliver clip, whatever it is, make sure–
Rebecca Markert: Or this podcast or!
Sarah Levin: Or this podcast, obviously this podcast episode, but if they have a short attention span and John Oliver helps best alternative. So that's first because you want to protect your family and friends from these plans and make sure that people know about them if you are an activist or if you're someone who's willing, and I hope everybody should talk to their legislators. Like I said before, most legislators don't know about these. And so literally just educating your legislators about them, you can send them information. The Center for Free Thought Equality has those materials. So if you go to CFEquality, that's C-F-E-Q-U-A-L-I-T-Y.org. So that's the Center for Free Thought Equality website, and you go slash resources slash HCSM. You can get all the background information. We have an Advocate toolkit with Talking points, a background one pager. You can also find our action alerts. So if you live in Vermont, Oregon, Minnesota, or New York, you can very easily just fill out your address and send a message to your legislators at the state level to support our transparency Bill.
But you don't have to live in one of those states to contact your legislators because this is something that we're starting in a few states, but we're hoping to really build that momentum. And really what takes the longest is just educating our legislators about the problem, because the amount of time it takes to basically cover what we just covered in this podcast episode, we have to do that with every legislator that's going to vote on the legislator, and they have very basic questions. We're starting from zero most of the time. So if you can educate your legislators and their staff about the issue, we make it super easy. Just download the toolkit and email them, call them, and I will guarantee you you're going to send them down a rabbit hole because they're going to be like, what is this? We've never heard of this before.
So educate your family and friends, educate your legislators. If you are in Oregon, Vermont, New York, or Minnesota, take action on the Center for Free Thought Equality's website. But there's one more thing that is really important that we really need, which is personal stories. We need, if you or anyone you know has been impacted by healthcare Sharing ministries where you signed up, you didn't realize what you had, and then you got denied claims, we need those stories so badly, especially if you are in Vermont, New York, Oregon, or Minnesota, because we need to show the impact of this issue on constituents. So that is like if you've got a story, no matter what state, but especially those states, please let us know. You can contact me at sarah@secularstrategies.com. You can contact the folks at the American Humanist Association. We have a story collection form that you can fill out as well, and you can find all of that on the CFE website.
Rebecca Markert: We will also put all of that information in the show notes, so you can go there to get Sarah's email and the toolkit that she was just describing. Thank you so much for joining us, Sarah. This was fantastic, really educational, and I can't wait until it airs. And people can hear the wonderful work that you're doing on a really important issue.
Sarah Levin: Thank you so much for having me, and thank you for all that you guys do. I'm really such a fan of the podcast, but also all the work that you do, so really such an honor to be on this podcast.
Rebecca Markert: Thank you, Sarah. That's it for today's episode. I'm Rebecca Markert.
Liz Cavell: And I'm Liz Cavell. If you haven't already, please follow us on our socials. We're on Facebook, Instagram, Bluesky, and X. And please also remember to let us know how you're liking the show by leaving us a review. You can also find us at we-dissent.org. Thanks for listening.
Rebecca Markert: We Dissent is a joint production of the Freedom From Religion Foundation, and Americans United for Separation of Church and State. It is hosted by attorneys Liz Cavell and me, Rebecca Markert. Special thanks to Kaleigh Spires AU Law student summer intern for her assistance in producing this episode. Other production support comes from Greta Martens, audio Engineering provided by Audio for the Arts based in Madison, Wisconsin. Thanks for listening.
