IFB continues to tackle high health care costs

Farmer working group to discuss Association Health Plans with multiple insurance providers.

DeKalb County Farm Bureau President Mark Tuttle, center, and Cook County Farm Bureau President Janet McCabe participate in a discussion during an Illinois Farm Bureau Health Care Working Group meeting. (Photo by Catrina Rawson)

By Deana Stroisch

Illinois Farm Bureau last week continued to study affordable health insurance options for members.

IFB’s Health Care Working Group spent five hours in Bloomington learning more about Association Health Plans (AHP). Members also received updates on regulations and legislation affecting health care on the state and federal level.

The working group, which will meet again during the summer, agreed to do the following:

- Continue discussions with Blue Cross Blue Shield about creating an AHP for Farm Bureau members.

- Initiate discussions with UnitedHealthcare to determine interest in creating an AHP.

- Engage in further talks with Texas Farm Bureau about a possible partnership to provide insurance.

- Continue educating members about ways to reduce health care costs, including available marketplace subsidies. Members also discussed hosting forums – online or in-person – in which farmers can share what health care options have worked and what haven’t.

The focus on health care stems from a Sense of the Delegate Body Resolution approved at IFB’s Annual Meeting in 2017. Last year, the working group recommended the organization pursue an AHP, among other things, and requested more time to investigate the issue.

AHPs aren’t new. Washington Farm Bureau has offered its members health insurance through an AHP since 2004.

But many state Farm Bureaus stopped offering AHPs after 2011, when the Centers of Medicare and Medicaid issued a guidance document based on the Affordable Care Act (ACA) that regulated AHPs by small group insurance requirements. This essentially removed the cost savings they provide.

In 2017, President Donald Trump signed an executive order that called for expanded access to AHPs, among other things. Now, working owners without other employees (including sole proprietors) and their families can join AHPs. The Department of Labor finalized those new rules in June 2018, and 34 new plans have been developed in 13 states, said R.J. Karney, American Farm Bureau Federation’s director of congressional relations.

Nebraska Farm Bureau is one of them. The state Farm Bureau began offering members health insurance through an ACA-compliant, fully insured AHP on Jan. 1. The Farm Bureau’s attorney offered advice to IFB’s working group by phone. About 700 members have signed up for their plan in its initial year.

Nebraska Farm Bureau Chief Administrator Rob Robertson also recently testified before the U.S. House Ways and Means Committee. Robertson said their participants will save an average of 25 percent on premiums this year compared to plans on the marketplace.

Robertson pointed to a husband and wife who farm together in southeastern Nebraska. They were told their insurance on the exchange would cost more than $26,000 this year. Farm Bureau’s AHP saved them $7,000, Robertson said. “That’s real money,” he said.

Rob McDade, COUNTRY Financial vice president for agency operations, said any health insurer that underwrites an AHP will want to make sure it is designed to be successful over the long run.

“An AHP may have attractive rates early on, but the real test is in the subsequent years,” McDade told working group members.

Insurance carriers will review the history of the plan – number of claims, cost, etc. – and decide each year whether to increase rates. That may result in some healthier participants choosing another option. “If they do, that leads to a spiral where experience is even worse the next year, and rates go up again,” McDade said.

The new AHP rule also faces a legal challenge. Twelve district attorneys from 11 states and the District of Columbia sued the Department of Labor over its AHP rule. The lawsuit, which remains pending, alleges AHPs have a negative impact on ACA markets by taking healthy people out of the pool and increasing costs for others.

About 2,500 members recently participated in an IFB survey about health care and other issues. The survey found:

- Health care was ranked as a top policy priority for Illinois farmers – second only to trade.

- 47 percent of respondents don’t have access to health insurance provided by an off-farm employee.

- 61 percent said they would consider participating in an Association Health Plan if IFB created one.

- 37 percent (the highest percentage of respondents) spend between $5,001-$10,000 a year out of pocket for health care coverage; 35 percent spend less than $5,000; and 20 percent spend between $10,001 and $20,000 a year.