An alternative to healthcare

I was just on the Matt Walsh blog reading responses to one of his posts. This particular post is real-life stories from people who are being affected by the Affordable Care Act.

Someone mentioned a bill-sharing ministry, which I've heard of before but not by that name. My understanding is that everyone pays into the "fund" each month, and medical bills are paid out of that fund. When someone submits a claim, it's paid out of the existing funds and the rest of the participants pick up whatever the fund doesn't cover. So if you have 100 people participating, and they're each putting in $100 per month the fund has about 10k per month to work with. So if someone submits a 20k claim, 10k would be paid out of the fund and the other 10k split between the individuals, so each would pay an additional $100.

My proposed structure is more like a health-insurance credit union or a health-insurance trust. The participants pay in every month, and medical bills are paid up to a certain limit, pretty much the reverse of our current system. As the fund builds, the amount available also increases. For the first year (or two years, depending on how it's structured) people would be restricted to the amount they've paid in to the system, but by that time the fund could have grown to the point where it is self-sustaining. If everyone has a particular limit per year then the fund could take a 30% loss and still be self-sustaining. And the next year each person has that same (or a higher) limit based on the fund balance. So a person who has 100k in medical bills could keep claiming the maximum per year as long as they continued to pay into the system.

People with preexisting conditions would have the same payout and the same "premiums" as everyone else.

Statistics say that 2% of individuals will have a "catastrophic" need in any given year. Even assuming that more than 2% of the individuals in the plan claim the maximum, the plan can take a 30% loss while remaining viable and continuing to grow. People would be in charge of their own medical coverage, deciding for themselves what they want to claim.

Example: Individual paying $100 per month, fund balance of 100k after the first year, 100 participants. Per family limit of 5k per year. 6% could claim the max and the fund remains viable. Year end balance of 160k, maximum goes up to 6k the next year or add 100 participants.

Makes sense to me. Someone please make it a reality?