Health insurance can be expensive, and this has led many people to go without it. In 2020, 28.0 million people didn't have health insurance at any point during the year, according to the US Census Bureau. It's not hard to believe, when the keeps creeping up, with the average cost of a family plan surpassing $22,000 per year in 2021.
With costs at a high and medical cost transparency seemingly at a low, it's no wonder that Americans are looking for new ways to pay for health care services. This guide explains five alternatives to shopping on the federal exchange for health insurance, and how you might be able to save money on health care without giving up the benefits you need.
Cost-sharing plans group people together to pool health care costs, resulting in lower payments. With a cost-sharing plan, you pay a monthly or annual membership fee. When you go to the doctor, you pay another fee (like a co-pay) and your organization covers the rest of your medical expenses. Cost-sharing groups partner with doctors and hospitals to negotiate rates, and the monthly membership fees often end up being less than traditional insurance premiums.
Many cost-sharing plans are religious or faith-based and require their members to adhere to certain lifestyle tenets. For example, Medi-Share is a Christian cost-sharing organization with a nationwide network that requires members to "have a Christian testimony indicating a personal relationship with the Lord Jesus Christ." Sometimes, these groups won't cover health care costs associated with activities they deem unacceptable, such as treatment for an STD that occurred from an extramarital affair.
But if you qualify for membership and happily adhere to the sort of lifestyle mandated by a cost-sharing organization, the benefits are many: Medi-Share offers 24/7 telehealth, access to over 900,000 providers nationwide, discounts on prescriptions and additional savings on select procedures. Other cost-sharing plans include Samaritan Ministries, Sedera Health and Liberty HealthShare.
You might find more affordable insurance by purchasing directly from a broker or insurance provider. Off-exchange insurance companies attempt to make it easier to find health insurance that's appropriate for specific needs and lifestyles and focus on making the notoriously complex process less mind-boggling -- important because insurance jargon can confuse people into enrolling in plans they don't need.
Oscar, for example, is a tech-based health insurance startup that offers health insurance to individuals, families and small businesses. The company offers bronze, silver, gold and platinum plans that offer the same benefits but differ in deductible and premium costs -- a bronze plan costs less each month, but you'll pay more at the time of health services.
Oscar and most off-exchange plans offer additional benefits you won't get with a federal plan, such as Oscar's 24/7 "doctor-on-call" feature and the ability to chat with a registered nurse through the Oscar app when you have questions. Other enticing benefits, like Oscar's step-tracking cash-back partnership with Google Fit and Apple Health, make off-exchange programs more appealing.
Health Pocket, Hooray Health Care and eHealth Insurance are other examples of off-exchange health insurance brokers. Off-exchange plans typically meet the requirements of the Affordable Care Act, but always check to make sure before you enroll.
Professional associations and trade groups
You may be able to find cheaper health insurance plans by joining a group or organization. For example, the National Association of the Self-Employed offers many insurance benefits for small business owners, entrepreneurs and sole proprietors.
Many trade groups, professional organizations and alumni associations work similarly to cost-sharing plans: You're grouped with other members of the organization so your costs are pooled and lowered. Search for professional associations with insurance benefits in your industry -- you might be surprised at the plans and rates you find.
You can also check with your state's department of insurance to find group plans that meet ACA requirements.
Health discount cards
Health discount cards are not technically an alternative to insurance: They are for people who plan to pay cash for health services as costs arise. Also called "medical services discount cards," these can be used for a variety of services at different types of health centers.
You may pay a one-time membership fee for these cards, or a small monthly fee, but the discounts can be substantial, sometimes upward of 50%. Not all health discount cards have fees, though: WellCard is a free health discount program that offers nationwide access to both primary care providers and specialists.
Like traditional insurance plans, health discount cards often have network restrictions, so be sure to check for nearby participating providers before you sign up for a card -- you don't want to be surprised with a full-price bill.
Like health discount cards, telemedicine is not a true alternative to insurance, but it might be the answer to a lot of problems. People who don't have the resources -- money, insurance, transportation or time -- to see a doctor in person can use low-cost telemedicine services to get diagnoses and prescriptions without insurance.
Many telemedicine companies do accept insurance if you have it, but the price of seeing a virtual doctor is far less than the price of going to a brick-and-mortar clinic without insurance (and sometimes, even with it). Convenience is another key factor in the telemedicine craze.
Of course, telemedicine can't do everything -- many situations require an in-person professional -- but it can serve as a low-cost alternative for easy-to-treat issues like the common cold, migraines, STD testing and pink eye.
Health insurance is expensive and a hassle, and many people can't afford to -- or don't want to -- enroll in traditional health insurance through the ACA. So, as health care costs continue to climb, people have figured out a way to take care of themselves without shopping on the federal exchange.
Benefits of these insurance alternatives vary and aren't suited to everyone, but can be viable solutions when traditional health insurance just isn't an option. Just make sure to read the fine print and understand what you're getting -- and what you're not -- when you sign up for an alternative.