Legislation allowing the Alabama Farmers Federation (ALFA) to begin offering health plans to its members is up for a vote on Tuesday after a lengthy public hearing in the House Health Committee this past week.
The committee met on Wednesday, during which time proponents and opponents voiced their concerns and opinions about the legislation allowing ALFA to provide healthcare plans.
House Bill 477 (HB477), sponsored by State Rep. David Faulkner (R-Hoover), would allow a "nonprofit agricultural organization" to offer health benefits to its members and their families. The bill does not mention ALFA specifically. However, ALFA is the only state organization meeting the bill's criteria. It would also specify that the nonprofit agricultural organization "would not be engaged in the business of health insurance." It also levies a 1.3% tax on premiums.
Faulkner boasted of six months of work to arrive at a compromise with several parties, including the Business Council of Alabama (BCA), Blue Cross Blue Shield (BCBS) and The Alabama Hospital Association (AHA).
Before Wednesday's public hearing, Faulkner spoke to the committee on the perceived benefits of his bill, pointing to Tennessee, which he claims was the first to successfully implement a similar program, which 10 other states have since adopted. For Faulkner, the ability of ALFA to offer healthcare options to its members will financially help those already working in a declining field that faces ongoing financial difficulties.
"These plans are needed because farmers and other small business owners often fall into a service gap," Faulkner said. "They earn too much money to qualify for federal subsidies, but now enough to pay the full cost of health insurance. It's not uncommon for a farm family to pay $2,000-$2,500 a month for healthcare coverage, often twice their home mortgage."
"As a result, farm families are faced to make difficult choices: go uninsured and risk catastrophic financial loss if they siffer illness or an accident, take an off-farm job to secure coverage, which impacts the productivity and sustainability of their family business or limit production to stay below federal subsidy thresholds. We have the opportunity here in Alabama to help the farmers and small business owners, who are the heart of communities in districts across Alabama, by allowing the federation to develop an ALFA health plan for its members."
The public hearing hosted eight people to speak; half favored HB 477, and the other half were against it. Those for the bill were all Alabama farmers and a representative of Tennessee's farm bureau. While those against represented state or national healthcare interest groups.
First to the podium was Emannuel Bankston, a Henry County farmer and Vice Chair of the State Young Farmers Committee, who spoke in favor of the bill. According to Bankston, substantially reduced costs for healthcare coverage would especially benefit young farmers.
"The economic conditions on the farm are not that good," Bankston said. "But one of the biggest problems that young farmers face, and I'm 34 years old, so I'm in that 8%, the minority within the minority, and I can tell you, it's healthcare. When you're spending the cost of two mortgages, and you're a farm family, a reduction in that in 30% or 60%, that's a lot."
Jane Adams, Government Relations Director for the American Cancer Society Cancer Action Network (ACS CAN), spoke against the bill, handing out papers to committee members containing stories from Tennessee patients who, according to Adams, "experienced pretty poor outcomes with their farm bureau plans."
"We believe this bill would take us backward, allowing plans that may exclude essential health benefits, such as preventative screenings, prescription drug coverage or hospital care, services crucial for detecting and treating cancer early," Adams said.
She continued, "Permitting the sale of plans that do not cover preexisting conditions will destabilize the insurance market. Healthy individuals can opt for these cheaper plans while those who need real coverage face skyrocketing premiums, making it harder for Alabamians to afford comprehensive care."
AHA Deputy Director Danne Howard also spoke against the bill, bemoaning hospitals' lack of an enforcement mechanism to collect money from a health plan provider.
"Outside of any enforcement authority in the bill, the only recourse for a hospital or any provider would be the courts, which would likely be more expensive to go through the courts than what would be collected from the reimbursement, to begin with," Howard said.
The farmers who spoke in favor of the bill emphasized the perceived financial benefits to their and other farming families, especially in encouraging young farmers to continue generational farming.
"We've been working for 20 years, every year, trying to find the best solution for our family," said Philip Hunter, who owns a 300-acre landscape and ornamental tree nursery in Talladega. "Currently, our healthcare premiums, annually, cost more than it costs for me to send my son to Auburn University. And they go up by, in the last three years, about $2,000 a year."
After the hearing, lawmakers asked Ben Sanders, the executive director of government affairs for Tennessee Farm Bureau Insurance, how Alabama's law compares with those of the other ten states that have enacted similar laws.
"This is the most voluminous bill of all the ten states that have passed," Sanders replied. "It's the most restrictive and has the most provisions and most requirements of all the 10 states."
Sanders also boasted a 98% retention rate in Tennessee and the other 10 states.
The committee didn't vote on the bill, but it is on the calendar for a Tuesday meeting
While not explicitly stated, debate on the bill suggested a high likelihood of some emendation. Health Committee chairman State Rep. Paul Lee (R-Dothan) and others asked to clarify ambiguity by explicitly listing services the healthcare plans would cover.
Editors note: this story has been updated to reflect a scheduled committee meeting that was not initially on the state’s legislative website
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