In December 2022, Geoff Perlman’s 20-year-old son broke his arm. To his surprise, the medical bills were covered by the generous contributions of strangers. Instead of dealing with traditional health insurance, Perlman now pays a monthly fee, never exceeding $420 for his family of four. This money goes to help with other members’ medical costs, such as a pregnancy or chemotherapy.
Perlman, a tech CEO from Austin, Texas, is part of a startup called CrowdHealth. This company uses a crowdfunding model to replace traditional health insurance, aiming to lower costs and ensure that money goes directly to real people rather than large insurance companies. Perlman appreciates how CrowdHealth avoids insurers’ tendency to deny claims and keeps members informed about actual healthcare costs.
“You feel part of a community,” says Perlman. “The money I’m paying helps others.” Founded in 2021, CrowdHealth allows members to support each other with medical expenses without any religious affiliations, just a shared commitment to financial solidarity.
Members pay about $55 a month to join, which covers administrative costs. Every month, they receive updates on medical needs from fellow members and can choose to help with bills, typically not exceeding $140 monthly for individuals under 55 or $420 for families. If someone doesn’t contribute, their support rating may drop, affecting future assistance.
When members have medical expenses, they are responsible for paying upfront. They can tell their providers they’re paying in cash and later submit receipts for reimbursement. CrowdHealth claims to cover 99.8% of claims, but the specifics of that statistic remain unclear.
According to a recent Gallup poll, only 44% of Americans rate healthcare quality as good or excellent—this is the lowest since at least 2001. Many people worry about the healthcare system’s unsustainable incentives and complicated regulations. Such frustrations have even led to extreme reactions, like the case of Luigi Mangione, who was charged with murdering an insurance CEO due to disputes over care.
Michelle Long, a senior policy manager at KFF (Kaiser Family Foundation), remarks, “People are asking, ‘What’s the point of health insurance if it just denies care?'”
However, it’s important to note that CrowdHealth is not a perfect substitute for insurance. Certain conditions, like preexisting conditions, won’t be covered for two years after joining. Members over 65, smokers, and those who are overweight are ineligible. CrowdHealth also doesn’t cover long-term prescriptions or fertility treatments.
Some find this new model appealing because they’re tired of their claims being denied by traditional insurers. Andy Schoonover, the founder of CrowdHealth, came to this realization after facing his insurance provider’s refusal to cover necessary treatments for his child. After trying the cash pay route, he discovered it was a much cheaper option, which led him to devise CrowdHealth.
To promote CrowdHealth, Schoonover appeared on various podcasts, reaching audiences open to alternatives. Among them was Kyle Ward, who had opted out of traditional insurance for ten years, preferring to pay cash for healthcare. Ward found that he could negotiate significantly lower rates when paying directly.
He faced challenges with preexisting conditions, but CrowdHealth still assisted him in finding lower-priced treatments. “Traditional health insurance isn’t working,” he argues. For him, the financial sense and community feel of CrowdHealth are both compelling.
CrowdHealth enjoys positive feedback, boasting a 4.8-star rating on Trustpilot. Still, it’s crucial to understand potential downsides. Unlike traditional insurance, there’s no regulatory body to oversee claims.
Caroline Niziol, who experienced frustrations with Medi-Share, another health-sharing ministry, felt the lack of coverage for certain treatments could be problematic. “You often end up having to argue your case,” she notes.
Health care experts advise thorough research before adopting a health-sharing plan. With millions of Americans possibly eligible for affordable care through the ACA, it’s wise for individuals to explore all their options.
As Perlman reflects on his experience with CrowdHealth, he sees real value in the cost savings. Previously, he paid as much as $2,000 a month for traditional insurance. Now, his family spends around $226 monthly, plus shared medical expenses for others, amounting to significant savings. Inspired by this model, he offers his employees similar choices, resulting in everyone opting for the stipend to manage their healthcare independently.
In a changing landscape of healthcare, CrowdHealth represents a fresh approach—one that resonates with individuals looking for community support over insurance bureaucracy. This shift could hint at a broader trend toward alternative healthcare solutions.
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