Farmers across the Midwest are facing tight profit margins and rising healthcare costs. And that means some hold off getting medical treatment or forgo health insurance altogether. In response, some state farm bureaus are trying to fill that gap by creating their own group health plan.
The sun is setting as Jacob Smoker does evening chores, feeding cattle on his family's farm in northern Indiana.
“We raise beef cattle primarily,” says Smoker, who chairs the Indiana Farm Bureau’s Young Ag and Professionals state group. “That goes to grocery stores, things like that, but then also we do row crops as well. Non-GMO corn, non-GMO soybeans, things for like tofu processing, as well as seed corn and wheat.”
After working in Chicago, Smoker came back to the farm a few years ago. He says one of the biggest challenges has been healthcare costs.
“Each person in the operation kind of has their own way that they're doing health care,” he says. “I've got a brother that's running without any right now I've got some my other brother runs with Department of Defense. He's a reservist in the army.”
And Smoker’s wife is working in part to get health insurance for their family. "[M]y wife teaches and right now, that's a really, really good benefit for our family. She doesn't do it for the money. It's mostly the insurance side of it.”
He and his wife have a daughter and another child on the way. After a complication in their daughter’s birth, Smoker says she needs ongoing medical care.
To get the most out of their health coverage, he and his wife have had to strategize about when to see a medical professional.
“We visit a speech pathologist and things like that, but the costs that are associated with that and the cost of not only the delivery, the associated hospital costs, but then the ongoing care, it is substantial,” says Smoker. “We meet her deductible quite frequently. So, it's something that's on our minds quite a bit. On a farm salary and on a teacher's salary, it stretches things pretty tight some years.”
Lots of Hoosier farmers face a similar problem with healthcare costs, according to an Indiana Farm Bureau survey. At the group’s annual convention in December, President Randy Kron told members that health care would be a top priority for 2020.
“We had about 2,000 of you answered the survey,” he said. “Two big things came out of it. One, it was very, very clear, overwhelming majority said the health care cost was adversely affecting your farm ... . The other thing that we got out of the survey was that we have to get down to the individual policy. Seventy-three percent told us they have no employees, so you got to be able to get down to an individual policy.”
Indiana Farm Bureau Director of Public Policy Katrina Hall says other organizations in the state offer a group health plan.
“There are many associations who offer an association health plan, the Indiana Chamber kicked off one recently,” says Hall. “But what we discovered was that those health plans that are already and enabled in statute are, they're really intended and drafted for two employees or more.”
Indiana law doesn’t allow the farm bureau’s proposed group health plan to cover sole proprietors. So, the bureau is looking to create that option, as Tennessee and several other Midwest states have done.
“There may be some health insurance providers who feel like this is competition for them,” she says of the proposed legislation, Senate Bill 184. “I would point out, though, that aside from what's offered on the ACA exchange, the primary provider in Indiana does not offer individual policies.”
These sorts of association health plans are raising concerns. Kevin Lucia of Georgetown University’s Health Policy Institute says they can carry a risk.
Healthy people might gravitate to these plans, leaving traditional plans to cover the most expensive care, he says. "And the people on the traditional markets ultimately could face higher premiums over the over the long term. And that's an important risk to consider.”
Lucia notes plans like the one the Indiana Farm Bureau wants to offer do not have to abide by the Affordable Care Act regulations. That may mean people with pre-existing conditions don’t get covered, and there isn’t robust mental health or maternity coverage.
He says, “So those are the kinds of things that I think state policymakers have to take into consideration before they open the door for a type of health insurance arrangement that doesn't have to come into compliance with all the kind of consumer protections that their individual and small group market carriers have to come into compliance with.”
Kron says the farm bureau plan will require a health evaluation, and that might cause some to be denied. “This isn't for everybody, but it will help a lot of our members and I think it's another choice on the market that will help some, a lot of our members."
He says members will be encouraged to join the plan as soon as possible. "Once you're on the plan, you won't be cancelled for health issues or anything."
Smoker says he realizes not every member of his family might be accepted into the group plan. “Everybody, every family's got some[one], you know, my mom's got a heart condition that would probably exclude her from that."
Still, he feels it is the best option, especially when it comes to younger generations taking over the family farm.
“Folks like myself, young families, people that are coming back to the farms, it's hard enough to come back to an ag operation as it is," he says. "And if you can alleviate some of that burden through a lessening the health care costs on an operator that that would be a huge benefit."
If legislation is approved, the Indiana Farm Bureau leadership wants to start offering health plans for next year.
This story was produced by Side Effects Public Media, a news collaborative covering public health.