Medical Cost Sharing Inc. promised to cover Christians' medical expenses, but the owners allegedly pocketed most of the cash

The U.S. Department of Justice has shut down a Christian “health share” ministry whose owners supposedly took in millions of dollars from gullible members only to use that money to line their own pockets rather than reimburse clients when they needed their medical expenses covered.

According to the Kansas City Star, Medical Cost Sharing Inc., which was based in Missouri, took in upwards of $750/month per member with the promise of helping them pay for health coverage alongside other fellow believers. It advertised itself as giving “Christians the opportunity to minister to the Body of Christ while being thrifty and seeing to their own medical needs.”

That’s not how it worked in practice:

Instead, founders James L. McGinnis and Craig A. Reynolds, both of St. Joseph, allegedly spent much of the charity’s money on a variety of things not related to health care. And they put at least $4 million into their own bank accounts, the federal <strong>government</strong> says — allegedly taking far greater compensation than was listed on the documents they submitted to the IRS on tax forms. 

In fact, over the past decade, they took in over $7.5 million but only paid out about $246,000—a little over 3%. They’ve paid nothing out since 2021. You can read other allegations from the lawsuit here.

In December, the Star reports, both mens’ homes were seized “as they were allegedly the fruits of wire fraud and money laundering.” That’s not all:

… according to investigators, Reynolds and McGinnis have enjoyed the fruits of their illicit labor, taking money out of MCS accounts to the point where the nonprofit didn’t have enough funds to cover claimants, the DOJ said in a complaint. Feds claimed the membership fees were used, amongst other things, to pay for a holiday to Mexico, various vehicles and a $300 gift to a Donald Trump political action committee.

Neither man has yet been charged with a crime; their attorneys, however, have denied all allegations of wrongdoing.

Still, the ministry and its website have been shut down by the judge while the case proceeds so that no one else gets scammed.
What are Health Care Sharing Ministries?

In general, groups like Samaritan Ministries and Liberty HealthShare ask everyone in the system to pay a specific amount into the insurance pool every month… but the companies don’t collect all the cash or send it to health care providers. For a fee, the company simply tells individuals where to send their money (e.g. Bob from Nebraska) and how much to send. If you need something covered yourself, you make a request and the company will send your name to others in the pool.

That’s not really different from regular insurance, but it’s not regulated, not all services are covered, and the providers can cut you off at anytime if you become too expensive to insure. Even worse: If you do something they deem “immoral,” you won’t get any money at all. (No contraception. No coverage for your same-sex partner. Definitely no abortion care.)

There have been numerous articles written over the years about customers who were denied help precisely when they expected to receive it. The end result is that Christian insurance companies are just like Christian movies and Christian theme parks: They claim to offer suitable alternatives for secular services… but they’re so much worse than the real things.

In 2020, the New York Times published a story about how some of those Christian groups were so awful that some states were taking legal action to prevent them from offering garbage plans to residents.

… state regulators in New Hampshire, Colorado and Texas are beginning to question some of the ministries’ aggressive marketing tactics, often using call centers, and said in some cases people who joined them were misled or did not understand how little coverage they would receive if they or a family member had a catastrophic illness.

The article noted that Washington fined Trinity Healthshare and banned it in the state. Even Texas sued Aliera Healthcare, which promoted Trinity’s products. In October of 2020, the state of New York filed civil charges against Trinity Healthshare and Aliera (which marketed the plans) for allegedly offering pseudo-insurance to 40,000 residents over the previous four years.

14 states and Washington, D.C. took action against Aliera before California got in the game last year, suing The Aliera Companies and the family that founded Sharity Ministries. Attorney General Rob Bonta claimed that Sharity Ministries “routinely denied claims and spent just 16 cents of every dollar in premiums on health care expenses.” By contrast, the Affordable Care Act requires (legitimate) health insurance companies to spend at least 80 cents of every dollar on expenses.

Christianity Today also found that Sharity Ministries, which filed for bankruptcy last year, left 10,000+ families with unpaid bills totaling over $50 million

Even John Oliver of Last Week Tonight spent an episode talking about these faith-based frauds:

The companies’ defense has always been laughable: They’ve said they’re not providing health insurance at all… therefore it can’t be insurance fraud. They’ve also insisted that, since customers have to sign a contract that says it’s not health insurance, everything is on the up and up.

But obviously the customers don’t really understand that. They think they’re getting health insurance from a company that proudly proclaims conservative Christian values. There’s a reason they think that: The companies strongly imply they’re health insurance companies. Just look at what the complaint from New York said:

Respondents aggressively advertise in the national and New York insurance marketplaces that these products are “affordable alternatives for health care” that provide comprehensive coverage, targeting consumers who are uninsured. Every aspect of Respondents’ marketing, notwithstanding their false disclaimers, leads consumers to believe that they have purchased legitimate, comprehensive health insurance coverage.

…

Members are issued membership cards, and Trinity maintains a network of providers and provides a search function on its website for participating providers for consumers to search.

It’s a bait-and-switch. Just like so many of their churches, these companies lure people in before telling members the whole truth. This was never insurance; this was gambling. Christians put money into the system with no guarantee that anything would come out on the other side.

Last year, three Democrats in Congress introduced a bill designed to crack down on Christian “health insurance” companies that have scammed upwards of 1.5 million people across the country. If signed into law, the Health Share Transparency Act would provide customers with transparency so they know what they’re buying into and hold Health Care Sharing Ministries (HCSMs) accountable if they fail to deliver on their promises. (You can read more details about the bill here as well as the actual text.)

The bill didn’t get anywhere, unfortunately, and with Republicans in control of Congress, there’s no reason to believe such a bill will get any traction. The GOP, which is full of Christian frauds, will never go after Christians committing fraud.

That’s why it’s a big deal that the government is doing after Medical Cost Sharing Inc. This allegedly fraudulent company has been going at it for years now, screwing over countless Christian families:

During its investigation of MCS, the FBI spoke to at least seven people — four from Missouri, three others from Georgia, California and Texas — who claimed they were duped by the charity and wound up with major health care bills as a result.

They signed up for plans that they said promised to cover all pre-existing conditions in exchange for monthly membership fees, like premiums. But when they complained about astronomical charges from hospitals, they said, Medical Cost Sharing told them the members were responsible for negotiating with hospitals and accused them of not being truthful about their health history.

For example, the Georgia man who sought kidney stone treatment at the hospital did so one day after waking with severe back pain. Through a family plan, at $784 per month with a $1,000 “personal responsibility,” he and his wife had contributed nearly $12,000 to the health-sharing ministry by that time.

Eight months later, when the $67,000-bill came in the mail from the medical provider, he says MCS denied they would “share” the cost because he had a “pre-existing condition” of a kidney stone from 12 years earlier.

Those members would have been better off buying an Obamacare-approved plan but their faith led them in a different direction, and they got duped by people who professed to follow Jesus.

(Large portions of this article were published earlier)