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There are no state or federal laws that require employers to offer health insurance benefits to any employees at all, says Robert Zirkelbach, director of strategic communications for America's Health Insurance Plans (ahip.org). While churches aren't obligated to provide health insurance for their staffs, most want to provide those benefits for their pastors and full-time employees. Yet many pastors today need to look elsewhere for health insurance—perhaps through an employed spouse—or simply risk living without it. Why?

"From my standpoint, finding coverage for a small church is not a problem," says Shirley Crandall, president of Crandall & Associates, Inc., a full-service insurance agency in San Antonio, Texas. "Any of the companies I work with will write a policy for a church with a minimum of two employees."

So the challenge for smaller churches isn't getting health insurance but finding affordable plans—affordable to both the church and the pastor. According to figures from the 2008 Employer Health Benefits Survey prepared by the Kaiser Family Foundation and the Health Research & Educational Trust (hret.org), the average family's out-of-pocket expense for health insurance premiums more than doubled in less than 10 years, even though more people enrolled in high-deductible plans.

The Kaiser survey found that workers in small businesses (firms of three to 199 workers) that offer health benefits pay, on average, $4,101 annually for family health insurance coverage, while workers at larger firms pay just $2,982 annually. Why the large difference?

"Many small businesses struggle just to provide any health benefits for their workers, and when it is offered, their workers on average pay more for family coverage and face higher deductibles than those working for big employers," says Kaiser Vice President Gary Claxton, co-author of the study and director of the foundation's marketplace research.

The Light and Life Free Methodist Church in Avon, Indiana, has a small staff eligible for a group health insurance plan: three full-time pastors and a preschool administrator, says Senior Pastor Chet Martin. Lining up health insurance for small churches is not a new issue for Martin, who previously worked as his denomination's conference superintendent. The conference provides a group health plan for about 40 families and a dozen individuals.

The conference also provides a Health Savings Account (HSA) plan for employees who opt to participate. "With this, we can set aside a part of our salary package—before taxes—to be used for medical costs," Martin says. "Out of our three full-time pastors, only two participate in the program, and each allocates funds into the account differently."

One of the challenges that small churches encounter in the program is the number of employees enrolled. "We are a small group, and pastors are notorious for making use of every benefit we have," Martin says. "We have an aging group and our demographics are not tipped toward young, healthy families. Consequently, I wish the law allowed all full-time pastors in Indiana or in a region to band together as one group. If we could all band together and be a group, then perhaps that would help drive prices down."

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