A new health care plan for Alabama’s farmers is on the table, promising to be the most comprehensive and restrictive of its kind in the nation.

But as lawmakers debate the details, some fear it could leave critical gaps in consumer and provider protections.

At stake, different sides say, is not only the economic survival of the state’s farming community but the very future of Alabama’s health insurance market.

The proposal, HB477, backed by Rep. David Faulkner, would create an unregulated health plan exclusively for members of the Alabama Farmers Federation.

ALFA, a powerful lobbying force among conservative lawmakers, claims the health plan will offer a lifeline for struggling farmers and businesses.

Similar plans are offered in 10 farm-rich states, led by Tennessee, which has had a similar plan in place since the early 1990s.

Efforts are also underway this spring to approve health care plans for the farm bureaus in Missouri and Ohio.

“The Farmers Federation is not looking to change Alabama’s health care,” said Faulkner, R-Mountain Brook.

The bill could get a vote in the Health Committee next week before it heads to the Alabama House floor.

It has yet to be heard in the Alabama Senate. The legislation has 39 co-sponsors in the House.

“Hear me out, this is not a plan for everyone,” Faulkner said.

“This doesn’t even save the nation and the state in health care. But it is an option. It’s an option for some. It could mean economic survival for small business owners and farmers.”

Insurance chaos

Opponents warn the bill could create chaos and concerns in the state’s health care landscape.

Though not classified as insurance, the health plan would operate outside the Affordable Care Act’s requirements and promise lower premiums – anywhere from 30% to 60% cheaper than traditional insurers.

“It will destabilize the insurance market,” said Jane Adams, government relations manager with the American Cancer Society.

“Those who need the coverage will face skyrocketing premiums.”

The creation of an unregulated health plan for farmers faces opposition from 30 organizations including the American Diabetes Association, American Lung Association and the American Heart Association.

The critics blast the health plan as an alternative that does not cover people with pre-existing conditions like cancer and diabetes.

“It does not protect them from high health care costs,” said Deanna Deschenes, an activist with the National Multiple Sclerosis Society.

“In fact, enrolling in these unregulated plans and the lack of transparency around them, makes it more likely farmers will encounter financial harm.”

The legislation was first introduced in Alabama last year and faces opposition from Blue Cross and Blue Shield (BCBS) of Alabama.

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Faulkner has met with representatives from BCBS and the Alabama Hospital Association, both of whom have expressed concerns about the lack of oversight for the Alabama Department of Insurance in administering the health plan.

As the dominant health insurer in Alabama, controlling over 90% of the market, BCBS argues that HB477 circumvents industry regulations and could mislead consumers.

Ted Hosp, vice president for governmental affairs with BCBS of Alabama, seemed resigned to the eventual approval of the new health plan.

Hosp urged lawmakers to considered some of the company’s concerns that include protections from cancellations or premium hikes for people who fall ill and offer mental health care and prescription benefits that are not written in HB477.

Hosp also said there should be more transparency on coverage costs, and he urged the Department of Insurance be granted investigative authority over the health plan.

“We think it’s a mistake to sell an unregulated health insurance, but we realize it will happen,” Hosp said.

“It’s entirely reasonable to include some basic protections.”

Defending plans

Faulkner admitted that ALFA isn’t required to provide coverage to someone with a pre-existing condition.

However, he said farm bureau plans offered in other states, particularly in Tennessee, have an “85 to 90 percent acceptance rate.”

He also noted that once someone joins a farm bureau plan, they are neither canceled nor subject to rate increase because of a change of health.

Ben Sanders, executive director with the Tennessee Farm Bureau – who has advocated for similar plans in other states – said his agency uses “evergreen contracts” that do not expire.

Those contracts ensure that people who have a farm bureau health plan are not kicked off of it.

Faulkner does not expect widespread adoption of the farm health plan, suggesting it is not intended for those with employer-sponsored insurance.

In Tennessee, the farm bureau’s health plan covers 138,000 people.

Tennessee’s population is 7.2 million, while Alabama has a population of 5.1 million.

Some lawmakers want assurances, written into the bill, that ALFA will not “pick and choose” people to be part of the health plan.

“You can pick a good crop of people to be in insurance,” said Rep. Paul Lee, R-Dothan, and chairman of the Health Committee.

“But what happens if you have two healthy young farmers, and 18 months from now they have a child with cancer, and have to go to UAB, Mobile or Texas or wherever (for treatment). I want those guys to have assurance that it’s an evergreen policy that they have it as long as they pay the bill. I don’t think it’s too much to ask.”

Rep. Frances Holk-Jones, R-Foley, a longtime insurance agent along the Gulf Coast, has said she is troubled with the lack of transparency with the plan.

Game changer?

Supporters at the public hearing said the creation of a health plan for farmers would reduce costs and could offer a lifeline for struggling farmers faced with soaring operational costs and declining commodity prices.

Faulkner claims the plan could save farmers up to $18,000 per year, calling it a ‘game changer’ for the industry.

Phillip Hunter of Shelby County, whose families owns and operates an ornamental tree nursery in Talladega County, said health care premiums “cost more than it costs my son to go to Auburn University” each year.

Hunter said without an alternative to paying escalating health care premiums, it will be difficult for young farmers to make a living.

“The costs are grim,” Hunter said.

Emmanuel Bankston, a 34-year-old farmer from Henry County and vice chair of the Alabama Farmers Federation State Young Farmers Committee, said that health costs can amount to two mortgages.

“If you’re a young farm family, a reduction in that could be the difference in having a profit,” Bankston said.

“We have the opportunity here in our state to make it better and have another option.”