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DIFS Files Cease and Desist Order Against Health Care Sharing Ministry, Connected Businesses Operating in Michigan
August 19, 2021
FOR IMMEDIATE RELEASE: August 19, 2021
(LANSING, MICH) The Michigan Department of Insurance and Financial Services (DIFS) has issued a cease-and-desist order against a healthcare sharing ministry and two connected companies for allegedly acting in violation of the Michigan Insurance Code.
"Health care sharing ministries can have a role in fostering the health, fellowship, and sense of community for individuals of faith, but they must follow the requirements of the law," said DIFS Director Anita Fox. "The DIFS investigation showed that the companies under this cease-and-desist order are essentially operating as unlicensed health insurance companies, in violation of the Insurance Code."
Though not considered health insurance under the Michigan Insurance Code, health care sharing ministries (HCSMs) are legal in Michigan under the Health Care Sharing Ministries Freedom to Share Act. They can provide assistance for individuals if certain requirements are followed, including collecting voluntary contributions from individuals who share a similar faith with no assumption of risk or promise to pay from the ministry to its participants. Plans that violate these terms may be considered health insurance companies and, if they are not properly licensed, they may be subject to action under the Michigan Insurance Code including a cease-and-desist order and possible fines.
The DIFS cease-and-desist order alleges that Aliera Companies is in violation of the law by marketing and selling memberships in a for-profit risk-transferring entity. Further, the order states that Aliera maintains direct control of two additional entities, Sharity Ministries and Ensurian Agency, and that all three entities broadly market HCSM plans to individuals and charge monthly premiums, which vary depending on age and health. Further, membership in the plans can be cancelled if a member chooses not to make their purportedly optional payments, a requirement that effectively makes the payments mandatory and violates Michigan's HCSM requirements
The Order alleges that the three entities take advantage of the Health Care Sharing Ministries Freedom to Share Act to operate as unlicensed insurers in Michigan and thereby avoid both state and federal insurance regulations. Under the Order, Aliera, Sharity, and Ensurian will have 30 calendar days after the service of the Order to contest it by requesting a hearing on the allegations. The alleged actions may carry civil fines of up to $50,000 and restitution paid to those affected by the purported HCSMs.
Consumers who need health coverage for 2021 may be eligible for a special enrollment period through the Health Insurance Marketplace if they've experienced certain qualifying life events, such as the loss of employer sponsored health care. For individuals who need to purchase health coverage for 2022, open enrollment for Health Insurance Marketplace coverage will begin November 1, 2021, and Michiganders can obtain coverage by visiting the Health Insurance Marketplace or by calling 800-318-2596 (TTY: 1-855-889-4325). Consumers will be able to choose from 175 health plans, including expanded options for low or no-cost coverage offered under the American Rescue Plan. Additional information is available on the DIFS website or by calling DIFS 8 a.m. to 5 p.m. Monday through Friday at 877-999-6442.
The mission of the Department is to ensure access to safe and secure insurance and financial services fundamental for the opportunity, security and success of Michigan residents, while fostering economic growth and sustainability in both industries. In addition, the Department provides consumer protection, outreach, and financial literacy and education services to Michigan citizens. For more information, visit www.michigan.gov/difs or follow the Department on Facebook, Twitter, or LinkedIn.