[Editor's Note: This is a guest post from Tom Rairdon, MD, dABA, an anesthesiologist who blogs at High Income Parents. We have no financial relationship. I didn't even know there was such a thing as disability “sharing” until I received this post.]
In light of the recent post and subsequent debates about ACA plans vs. Medical Sharing plans, that led me to investigate the other benefits that the Christian Care Ministries offer through their sharing programs and add more fuel to the fire so to speak. Truthfully I hope it gives some more financial information to the WCI community.
Under full disclosure I have been a member of the Medi-share plan for the last two years and I have been pleased, but we really haven't put the plan to any kind of test. We have a high maximum “share” amount of $10,000 yearly. We haven't met our “maximum share” amount in these past two years so the only benefit we realized was the pre-negotiated insurance rates through the network Christian Care Ministries uses. It is the PCHS PPO Network and every doctor and facility we have ever tried to use has been in that network which was a big part of why we pulled the trigger on changing to a share plan instead of insurance.One of the other programs they offer is call “Manna” and it operates as a disability “share” (not insurance, definitely not insurance) in the event that you are unable to perform your job.
The Legal
Right out of the gate on their website the first guideline says:
“While Manna exists to assist its members in time of disability, just as with church benevolence programs, there is no guarantee that assistance will be available. Therefore, neither CCM nor Manna members shall be held liable for any part of a person's financial obligations. Each member remains individually liable and responsible for their financial obligations at all times. Manna is not disability insurance, nor is it guaranteed in any way. Manna is not, and should never be construed as, a contract for insurance or a substitute for a contract guaranteeing disability insurance. CCM shall not be held liable for a failure to replace any part of a member's income.”
So there is the out if they don't believe you are truly disabled. Also the coverage is limited.
Events/Conditions Not Eligible for Sharing
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The following events/conditions are not eligible for sharing: elective cosmetic surgery, mental illness and depression, pregnancy, chronic fatigue syndrome, chronic pain, fibromyalgia, Epstein-Barr Syndrome, causes from acts of war, and Lyme Disease.
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The following events/conditions will not be eligible for sharing unless surgery is involved: carpal tunnel syndrome, back injuries, and knee injuries. For instance: the member has been diagnosed with carpal tunnel and the doctor states surgery is required. The event/condition will then be eligible after surgery is performed.
As has already been discussed in health-care-sharing-versus-health-insurance, you have to meet all the qualifications that are stated in the medical sharing plan to also qualify for Manna. You also have to pay a $50 application fee in order to be considered for the program, which does not guarantee approval. This fee can be waived if applying for healthcare sharing simultaneously.
The disability coverage is broken down into “units” which constitutes $2200 each. The max benefit is 6 units ($13,200 per month) or 80% of the verifiable lost income, whichever is lower. This is payable once you have been disabled for 60 days. The extent of the benefit is 12 months after the 60 day waiting period. Each unit has a $14 share amount maximum, which is also variable with a $10 administrative fee, so you are looking at a maximum of $94 a month “share amount”(not a premium). This amount can be lower if they take in more than they distribute out that month.
Possible Benefit?
Now this got me thinking. We all know that long term disability gets less expensive as you delay the benefit. I looked at disability quotes online for a 40 year old male anesthesiologist. The AMA sponsored insurance DisabilityPro quoted me $1767 yearly premium for a $13,500 per month policy payable at twelve months after disability and $4770 payable after two months. That is a $3,003 difference.
Manna is only going to cost me $1128 maximum with the possibility to be even less since it is a “variable share amount.” That is a savings of $1875, but for $300 less coverage per month in that first twelve months after disability.
I've also included some other quotes that I was able to attain by filling out some insurance website filters. Here is one for Guardian.
So a yearly total of $8892 but with far better coverage. Here is one that gave me an expected premium price before they collected any of my specific information.
That translates to $12,708. Both of these were obviously higher than the DisabilityPro quote but had far better coverage. Obviously each person’s situation is unique and you would have to compare your numbers against the disability share program.
More Disclosure
Another data point to all this is I signed up for this program about a year ago and my “variable share amount” has been substantially less than $94 per month. My average monthly share has been $30.90 for a total cost of $371 per year. So there is a substantial price difference.
More Legal
Christian Healthcare Ministries also says:
“Manna is Secondary to Other Sources of Income Replacement”
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They expect other insurance to cover before they kick in the disability share. It was unclear in the guidelines if merely having other disability insurance from another company disallowed you from getting any Manna benefit or if the disability insurance had to be actually paying a monthly check in order to rule out Manna eligibility.
If Manna will pay the first year this could be a more cost effective way to cover your income in the event of a disability if you don't want to touch your nest-egg or you don't own a nest-egg in the first year of disability. I do not have an affiliation with this program and won’t be compensated in any way if any of you decide to go with this program or any other disability share program. I just want to share some information with a community that has immensely helped me over the years.
Conclusion
If you are willing to take the risk of a non insurance disability sharing program it appears you could save a substantial amount of money per year if you need coverage within two months of disability. Some other questions that could come into play are whether this disability benefit is after tax since it is paid with after tax dollars? Could it be considered a gift? Would that make it subject to the gift tax? I imagine it would be just like any other disability benefit but no one was available to answer my question when I called the company.
I think the best course of action is to self insure by having an emergency fund of twelve months expenses so you can purchase the longer wait time fully comprehensive coverage. In the mean time while you are waiting to accumulate that emergency fund this could be a viable alternative.
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[Editor's Note: The idea of disability “sharing” is intriguing, especially given the impressive cost savings that health sharing has produced over true health insurance in the ACA era. The problem is disability sharing is basically a replacement for a short-term disability insurance policy, which is not one I ever really recommend. I believe you should insure against financial catastrophe. That includes stuff like your house burning down, death of a breadwinner prior to financial independence, serious illness or injury, personal/professional liability, and long-term disability. But short-term disability? That's what your emergency fund is for. I typically recommend 3-6 months of expenses in your emergency fund, and this policy does go out as far as 12 months, but if you still need a disability insurance policy for the period after 12 months of disability, I figure you might as well just buy a “standard” 90 day waiting period long-term disability policy. When these ministries offer a long-term disability sharing program, I would be willing to take another look. I'm also bothered by the extensive list of exclusions including mental illness and back issues, both of which are frequent causes of real disability.]
What do you think? Do you participate in disability sharing? Why or why not? Would you consider it if there were a long-term product? Comment below!
Interesting, I had no idea something like this existed!
This sounds like a total scam to me. I can’t imagine a scenario where they would pay out.
I can’t imagine a scenario where a “scam” would consistently charge 1/3 the monthly payment you originally agreed to. That said I agree with WCI, I have no need for a 1-year disability policy.
I don’t really have a dog in this fight because I’ve since discontinued my policy after writing this.
That being said I don’t see why you would doubt them paying as long as you fall within the coverage limits. If you do have a dispute they have a mediation and arbitration process, so they can’t just disobey their own requirements without consequences.
Here is the page with the information.
https://mychristiancare.org/medi-share/medi-share-extras/manna/manna-guidelines/
I agree with WCI that self insuring with a years worth of expenses is the best way to go but this could provide a bridge and reduce costs while saving for that years worth of expenses.
Am I missing something? Doesn’t this group discriminate (somehow legally) based on religion alone? They basically proudly proclaim that Jews, Muslims, and the “wrong” type of Christians/non-Christians need not apply. Shouldn’t we as physicians reject this type of company?
If an investment firm came out with amazingly low cost index funds with zero fees, with the only catch being they refused to allow Muslims to purchase shares, would you still invest? Financial freedom at what cost exactly?
This is the whole basis of any type of religious based sharing organization regardless of it’s Christian Muslim or Jewish. It’s currently legal but that could change with the new healthcare laws. We will see.
That’s a whole other debate but I think we can all understand why their premiums are lower. If you take a subset of the population that doesn’t drink to excess, smoke, and do drugs I would think that is a lower risk pool and would require lower premiums. Add in the fact that the organization is not for profit and doesn’t cover mental illness and that could further reduce costs.
To me it goes back to the debate between everyone going into the insurance pool (socialized healthcare) and selecting out groups like Walmart or Toyota employees getting a different rate verses Target employees. I guess each doctor needs to decide what he/she is willing to do to save a buck.
I can tell you if they increase HSA limits to $13,000+, it will make these sharing organizations much less attractive to me.
The future of all health insurance likely lies in the development of organizations (religious and non religious), credit unions, etc…banding together to provide PORTABLE insurance, so we are no longer dependent our workplaces to provide.
The key is providing these organizations (and ideally the individual directly) the same tax free status that businesses enjoy for health care.
Stir in competition across all fifty states, and let the marketplace elevate quality and reduce price. Government simply can’t do this for us folks.
Surprising concept. I am with you WCI, it seems like a short-term solution. The long term is what scares me. If you are the breadwinner and you get injured (as happened to a friend of mine recently while walking on a beach) then you better hope you have a good long term insurance plan in place.
Whether or not it’s useful it’s pretty interesting to read about. The details make me wonder if they actually employ actuaries who make these decisions and set their rates, or if it’s just a big game of guesswork where they’re throwing stuff at the wall and seeing what sticks.
From the list of exclusions, it looks like they’re trying to cut down on all of the claims from highly subjective (and thus most prone to fraud) ailments. mental illness and depression, chronic fatigue syndrome, chronic pain, fibromyalgia, are all symptoms of someone who’s making it up, as well as things that aren’t really a disability like elective cosmetic surgery or pregnancy (though I wonder if this includes complications).
Epstein-Barr Syndrome and Lyme Disease are a little puzzling to me, but perhaps these are prone to fraud/abuse as well. I’ve seen a couple of people be out of work for seemingly ever with mono, who knows.
Of course, that excludes a lot of people with legitimate disability, but if it dramatically decreases cost and still provides a meaningful benefit, perhaps it may still be attractive to some consumers.
This is so worthless that it must be a scam. First article with no business on this site.
You don’t think this site should expose scams?
Then explicitly say so or expose all of the flaws. Much too rosy a picture about a scam.
I THINK SHORT TERM DISABILITY INSURANCE IS A SCAM.
Was that explicit enough?
I don’t think I could have been any more objective in the article but everyone is entitled to his/her opinion. At least you know it’s out there now so you won’t be caught off guard if someone tries to scam you with disability sharing in the future.
In my current practice, I see many patients who claim total and permanent disability for subjective complaints such as chronic back pain, fibromyalgia, and chronic fatigue syndrome. This is placing a significant financial strain on the social security disability system.
I understand this is a controversial topic, but I do think the social security disability program could do a much better job distinguishing true disability from simple lack of motivation. If a patient did truly have chronic back pain or fibromyalgia, this may prevent them from doing a heavy manual labor job, but would not necessarily prevent them from doing a more manageable form of work such as a desk job.
Whatever you think about disability sharing programs, I commend them for trying to prevent potentially fraudulent disability claims for subjective, nonverifiable complaints.