September 28, 2021
TRINITY HEALTHSHARE, INC. FILES FOR BANKRUPTCY AMID PENDING DFS ENFORCEMENT ACTION
DFS Action charged that Trinity engaged in selling sham insurance to New Yorkers
Trinity’s bankruptcy filing underscores need for Department’s enforcement action against unlicensed entities
On July 8, 2021, Trinity Healthshare, Inc. (“Trinity”) abruptly filed for bankruptcy amid an enforcement action brought by the Department of Financial Services alleging that Trinity and its affiliate, the Aliera Companies (“Aliera”), engaged in a fraudulent and illegal health insurance business in New York.
In connection with its bankruptcy filing, Trinity, now calling itself Sharity Ministries, dropped its current members and asserted that it had no obligation to pay members’ medical claims, leaving millions of dollars in outstanding claims. Trinity’s actions underscore a core principle underpinning the Department’s enforcement action: insurance products must be subject to regulatory oversight to protect consumers. Insurance companies are regulated to ensure that they remain financially strong and live up to the promises they make to their policyholders.
In October 2020, the Department brought an action against Trinity and Aliera for illegally selling unregulated insurance products. As alleged by DFS, Trinity and Aliera sold insurance products that were disguised as purported health care sharing ministry “member sharing” plans, claiming that the products were not subject to regulatory oversight. Trinity purported to be a health care sharing ministry, but was wholly dependent on Aliera, its for-profit affiliate, for essentially all of its operations.
DFS alleges that Aliera siphoned off most of Trinity’s member payments rather than leaving them to be used for their intended purpose: the payment of members’ claims. In sum, through its enforcement action, the Department sought to protect New York consumers from being short-changed by these illegal operations. Now, Aliera and Trinity are using Trinity’s bankruptcy filing as a shield against being held responsible for violating the law and paying medical reimbursements owed to consumers.
Consumers that had a plan with Trinity/Sharity or Aliera should immediately contact the DFS Consumer Assistance Unit at the Consumer Complaint Portal. A full copy of the Statement of Charges and Notice of Hearing against Aliera and Trinity can be found on the DFS website.