How Iowa Farmer Bureau Designed Less Costly Association Health Plans
As association health plans like the Iowa Farm Bureau Federation’s Farm Bureau Health Plan develop, concerns for unsubsidized Iowans with pre-existing conditions persist.
- The Iowa Farm Bureau Federation’s Farm Bureau Health Plan was designed to help unsubsidized Iowans afford a health plan and represents the controversy surrounding association health plans.
Association health plans have been cast as a solution for individuals whose incomes disqualify them for subsidies but who still cannot afford premiums for ACA-compliant plans.
Iowa Farm Bureau Federation and its partner Wellmark Blue Cross and Blue Shield provide non-insurance health benefits. As they are labeled “non-insurance,” these plans are not governed by the ACA and do not use tax revenues. Members are not eligible for Medicare, Medicaid, or employer sponsored health plans.
The Farm Bureau Health Plan offers members three options. Iowa Choice 3500 and Iowa Choice 6000 have copays, coinsurance, and deductibles like any other traditional health plan with out-of-pocket cost maximums of $15,000 and $20,000, respectively.
Iowa Choice 6650, however, is a high deductible plan with no coinsurance, and no prescription drug costs once the deductible is met. The deductible is $6,650 for a single individual and $13,300 for a family.
All three plans offer free preventive care. They cover all Iowa hospitals and 97 percent of Iowa’s physicians.
The plans are underwritten by the Iowa Farmer Bureau, which enables Iowans to enroll at any time, not just during the ACA enrollment period. The underwriting also means that the bureau can screen enrollees before deciding whether to accept them.
In order to enroll, potential members must fill out the pre-enrollment checklist. The checklist requires enrollees to list their medical history from the past five years. Conditions that must be disclosed include diabetes, heart problems, and mental health conditions. If the enrollee attests to any of those or over a dozen other conditions listed, they must then provide details regarding the duration, provider, and treatments.
Slightly over a year after the state approved the bill allowing associations to provide non-ACA health benefits, the Iowa Farm Bureau Federation’s Farm Bureau Health Plan has cut costs. Some members saw premium cuts of up to 50 percent.
However, contentions still exist over potential enrollees with pre-existing conditions.
Not only can farm bureau health plans deny or penalize individuals with pre-existing conditions, but they can also affect premiums for individuals with pre-existing conditions in other plans, opponents of farm bureau health plans argue. By attracting mainly healthy membership, these plans may drain healthy members from the ACA, which relies on healthy beneficiaries to offset high-risk patients’ costs.
Kansas and Tennessee have adopted farm bureau association health benefits plans and Georgia’s Anthem is on the verge of partnering with the state’s farm bureau as well. Tennessee’s Farm Bureau’s application is more intensive than Iowa’s, spanning 13 pages and requiring seven years of medical history, as of October 2018.
Proponents of these types of association health plans argue that the ACA is already failing patients with pre-existing conditions by offering plans with costly premiums.
The recent hearing at the House of Representatives Energy and Commerce committee underscored the challenge of providing health coverage for individuals with pre-existing conditions.
When asked whether the Trump Administration’s plan to repeal the Affordable Care Act (ACA) jeopardized health insurance for Americans with pre-existing conditions, CMS Administrator Seema Verma responded that individuals with pre-existing conditions are already endangered, even with the ACA in place.
She pointed to lower middle-class Americans with pre-existing conditions who are ineligible for subsidized health insurance but who also cannot afford ACA-compliant health plans, implying that they are patients with pre-existing conditions who are being denied health coverage.
The administration’s answer to this problem thus far has been to offer short-term and association health plans, such as the Iowa Farm Bureau Federation’s health plan.
As these plans are still in their first years of existing under the ACA, data on the numbers of those with pre-existing conditions being denied coverage by farm bureau health plans is still accumulating. As research unveils the trends, it will become clearer if association health plans present a detrimental or useful alternative to ACA-compliant, subsidized plans.
