Congressional Freethought Caucus Calls on FTC to Investigate Deceptive Health Care Sharing Ministry Practices

HCSMs Reportedly Jeopardize Health of 1.5 million Americans Through Deceptive Marketing Practices and Systemic Failure to Provide Necessary Products and Services

October 27, 2021

Washington, D.C. – Today, Representatives Jared Huffman (CA-02) and Jamie Raskin (MD-08), founders of the Congressional Freethought Caucus, led a letter on behalf of the caucus to Samuel Levine, Acting Chairman of the Federal Trade Commission (FTC) Bureau of Consumer Protection urging the agency to take necessary steps to protect consumers from the dangers presented by Health Care Sharing Ministries (HCSMs). HCSMs are a form of health coverage in which members – who are typically recruited because they share religious beliefs – contribute monthly payments to cover the qualified expenses of other members.

“Although they are not legally defined as insurance products, HCSMs are the primary and often singular source of health coverage for their members. Despite this, HCSMs are not legally required to provide the same benefits to consumers as certified insurance products. The discrepancies between HCSMs and regulated insurance are varied and consequential: unlike traditional health coverage, HCSMs do not have to provide the essential health benefits of the ACA like maternal health care, prescription drugs, mental and behavioral health, and preventive and wellness services, including vaccinations.  HCSMs also are not required to cover pre-existing health conditions, can charge higher premiums for members based on their health status, place lifetime caps on member benefits, and do not guarantee the payment of medical claims,” the members wrote in their letter.

“It is unconscionable that consumers may be tricked into purchasing inadequate health coverage during a global pandemic, especially when ACA exchange insurance is at its most affordable ever as a result of the American Rescue Plan,” the letter continues. “The patchwork of state laws, regulations, and enforcement actions are insufficient to address the challenge of HCSMs, especially given that a majority of states exempt HCSMs from all insurance regulations.  Considering the dangers of HCSMs, and their marketing practices that provide a false sense of security to their members, it is critical that FTC take immediate action to protect consumers.”

The letter outlines requests for further information on five specific items, including:

  1. Enrollment: What actions can FTC take to protect consumers from enrolling in health coverage that does not cover medically necessary tests and services?
  2. Investigation: What actions has FTC previously taken to investigate, prosecute, cite, fine, or otherwise address the behavior of HCSMs? Has the FTC previously determined if the business practices of HCSMs constitute consumer fraud?
  3. Enforcement: What enforcement actions has FTC previously taken against deceptive marketing in health care coverage and how do those cases apply to marketing done by HCSMs?
  4. Complaints: How many complaints has FTC received to date regarding the marketing or business practices of Health Care Sharing Ministries? What are the general contents of those complaints?
  5. Transparency: What steps can FTC take to ensure that HCSMs must publicly display their terms and conditions so that consumers understand the extent of their coverage? Will this include a clearly written explanation of benefits, as certified insurance products must provide?

The full letter is available online here.