The Affordable Care Act requires nearly every American to have health insurance or pay a penalty, beginning Jan. 1. The so-called "individual mandate" has been controversial ever since the law was passed.

But for people who fall into a few select categories, the mandate doesn't apply. Like Native Americans who get health coverage through the Indian Health Service, or people who are incarcerated.

Another exception is for members of "health care sharing ministries," a way for individuals with a "common set of ethical or religious beliefs" to share medical bills.

Sharing Health Burdens

The sharing ministries are not insurance: there's no guarantee that a given bill will be covered. Instead, it's like a co-op, where members decide what procedures to cover, and then all pitch in to cover the cost as group.

"It's a group of people, in this case Christians, who band together and agree that they want to share one another's burdens," says Andrea Miller, medical director for the largest Christian health-insurance alternative, Medi-Share.

She says members put aside a certain amount of money every month, which then goes to other Christians who need help paying their medical bills. Medi-Share's monthly fees vary, but its website advertises that family options "average less than $300 a month."

There are a few requirements to fulfill before participating, Miller says. The first is that you have to be Christian. "Second, you need to agree to living a Christian lifestyle, including no smoking, including not abusing alcohol or drugs," she says.

To constitute as a health care sharing ministry — and therefore be exempt from the Affordable Care Act requirements — the nonprofit has to have been in existence since 1999 (Medi-Share has existed since '93). The ministries also have an independent accounting firm conduct a publicly available annual audit.

Footing The Bill

Tens of thousands of Americans belong to Christian health sharing ministries, including Fred Bennett of Chattanooga, Tenn.

Bennett and his wife, Beth, have belonged to a health care sharing ministry for 19 years. They've always been healthy, but in the last few years, as they've entered their 60s, they started to have medical trouble.

"In '04, my wife was rushed to the hospital with E.coli in her kidneys and, actually, it spread to all of her body," he says.

She recovered, but the hospital bill was staggering. After six days in the hospital, most of which was spent in intensive care, the cost came to about $70,000.

And that bill was just the beginning for the Bennetts.

"She hasn't had many claims, but unfortunately, I had a stretch of five or six years there that things were pretty rough," Bennett says, including multiple surgeries and a heart attack.

The medical bills reached tens of thousands of dollars, but for each incident, the Bennetts paid only their $250 deductible. The rest was paid by fellow Christians through Medi-Share.

Of course, the same would have been true if they had normal health insurance. But Bennett says he prefers the health sharing ministry because the ministry doesn't pay for procedures he thinks are immoral, like abortions.

"The part I liked about it was that I wouldn't have to be having some of my premiums spent to take care of someone who wasn't taking of themself, physically or spiritually, either one," he says.

What's Not Covered

While the federal health law includes an exemption for health sharing ministries, some states have sued to try to keep them out. The concern is that consumers shopping for insurance will be confused about what ministries really guarantee in the way of coverage.

"We do not share in every medical need that a person has," Miller of Medi-Share says. "Some of the things we don't share in are related to lifestyle issues, such as an abortion. But others of them are related to things that the members have agreed that they would rather pay for themselves."

For example, she says, members tend to pay for their own preventative care (with the exception of very young children). There are also some restrictions on pre-existing conditions.

At Medi-Share, Miller works with a steering committee of health share members who discuss what kind of care is covered by the guidelines. "Any significant change in the guidelines is something that has to be passed by all the members," she says.

In August, CNBC reported that members whose claims are rejected have the right to file an appeal. In the current fiscal year, 76 percent of the bills submitted to Medi-Share were considered eligible, and all of those were covered, Medi-Share told CNBC.

Spiritual Support

Bennett of Tennessee points out that because all the members decide what to share the cost of, health ministries often cover things insurance rarely does, like adoption fees and funeral costs. Plus, he says, his health sharing ministry gives him a service he could never get from an insurance company.

"The night before my surgery, the lady who'd helped me locate the right providers and everything called me back and said, 'Would it be OK if I prayed with you for your surgery tomorrow?'"

Three days later, she called back to ask how the surgery went.

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