This company collected hundreds of millions of dollars from Californians. Now state is suing

California Attorney General Rob Bonta is suing The Aliera Companies that offered sham health insurance plans and collected millions of dollars from Californians only to leave consumers with mounting debt after declining to cover their medical costs.

Bonta, who announced the lawsuit on Wednesday, also is suing the Moses family, which founded Sharity Ministries, Inc., formerly called Trinity Healthshare, Inc., “a nonprofit corporation that purported to be a health care sharing ministry.”

Aliera sold the unauthorized health plans through Sharity/Trinity in California and across the country, Bonta said.

He said it’s “egregious when bad actors” in the health care market take advantage of consumers and sell “essentially worthless coverage.”

“Aliera collected hundreds of millions of dollars in monthly premiums from thousands of Californians and families throughout the country, but rather than paying its members’ health care costs, the company declined the claims and kept nearly 84% of its members’ contributions,” Bonta said. “This left countless families crushed, not just by illness and the way of medical emergencies, but by the burden of insurmountable medical debt.”

He said the company’s actions are illegal and there will be consequences.

Bee story exposed issue

In January 2020, a story by The Bee written as part of the USC Center for Health Journalism Collaborative reported that Aliera was facing legal troubles in multiple states and was ordered to stop taking new clients, but in California, it was continuing to take new customers through Trinity. At the time, Trinity had 7,630 members in California.

Two months later, in March 2020, the California Department of Insurance issued a cease-and-desist order against Aliera and its subsidiary Trinity seeking to get the companies to stop doing business in the state.

In May 2020, a California couple was part of a federal class action lawsuit.

Then in May 2021, Bonta issued a consumer alert to warn residents of sham health care plans after his office received “multiple complaints from devastated Californians” who had been “left in financial jeopardy with mounting medical bills after their healthcare sharing ministry plan failed to provide the reliable coverage they expected.”

Faith-based legitimate health care cost-sharing ministries offer the opportunity for people to pay into a system every month and share health care costs among all members. To be exempt from California’s individual mandate, health care cost-sharing ministries must have been in existence at all times since Dec. 31,1999, with medical bills for their members shared without interruption.

Bonta on Wednesday said Aliera “was not a true health care sharing ministry.” In the lawsuit, he said, his office alleges Aliera falsely represented itself to make consumers believe it was a legitimate health care sharing ministry, and that their contributions were going to pay the health care costs of their fellow members who shared their faith.

“In reality though, the coverage was junk,” he said. “The company spent less than 16 cents of every dollar on member expenses and pocketed the rest.”

In 2020 complaints with the Better Business Bureau, people said they paid thousands of dollars on monthly member contributions, and thousands of dollars more when a medical issue arose. Aliera couldn’t cover the costs.

Bonta said Wednesday’s action should serve as a warning for other health care market entities.

“The DOJ is watching,” he said. “We will take action if you violate the law.”

Covered California perspective

Covered California Executive Director Peter V. Lee, who also took part in Wednesday’s news conference, reminded Californians of what they should get under the Affordable Care Act and what they could miss out on under even a legitimate health care sharing ministry.

“Under the law, you can’t be denied a claim because of a preexisting condition,” he said. “That is not the case with any sharing ministries. Any of them. Now, Aliera took it three steps further.”

Even some legitimate health care sharing ministries don’t cover preventative care, prescriptions, contraceptives and mental health. Some ministries also require its members to limit their alcohol consumption, and they won’t cover treatment for sexually transmitted diseases, if the illness was contracted by consensual sex outside of marriage.

Under the ACA, Lee said, at least 80% of the premiums should go toward health care costs. Covered California health care plans, on average, spend 87% of premiums collected on health care costs, he said.

“That’s the right thing,” he said.