New Law Will Offer More Healthcare Options for Iowans Priced out of Individual Market

Law allows Iowa Farm Bureau to offer health benefit plans to members
May 11, 2018, 1:16 pm | Kristine Tidgren

AMES, Iowa ― In April 2018, Iowa Governor Kim Reynolds signed a new law that is designed to address the mounting difficulties faced by many Iowans seeking to purchase health insurance on the individual market. Specifically, this law will provide two new healthcare benefit options for small employers and sole proprietors, the groups most impacted by Iowa’s healthcare crisis.
 
An in-depth analysis of the new law – SF 2349 – can be found in the May issue of Iowa State University Extension and Outreach’s Acreage Living Newsletter. It is written by Kristine Tidgren, director of the Iowa State Center for Agricultural Law and Taxation.
 
The law creates Iowa Code 505.20, which allows Iowa Farm Bureau to offer new “health benefit plans” to its members. These plans are “deemed to not be insurance” and therefore would be exempt from Affordable Care Act requirements and Iowa Insurance Division regulation. The plans would be self-funded and subject to third-party administration by Wellmark Blue Cross & Blue Shield.
 
Because the legislation provides little detail, much remains unknown about what these “health benefit plans” would comprise. The Legislative Services Agency estimates the plans would cost roughly $5,000 per year per family. This is in contrast to an average of $17,000 per year per family for those ineligible for subsidies who purchased insurance on the individual market in 2018.
 
“Iowa has a large problem impacting those who have to buy health insurance on the individual market,” Tidgren said. “This includes many farmers in the state, as well as employees of small businesses that are not large enough to offer health insurance. Many of these Iowans do not have access to affordable health insurance options. The new law gives people who have been priced out of the market a place to purchase insurance where otherwise they would have no access.”
 
While Tidgren stresses that the law isn’t perfect, it does provide an affordable option to farmers and other self-employed workers in Iowa.
 
“This isn’t necessarily the best solution, but it is a workable one,” Tidgren said. “Critics of the law point out that these insurance policies won’t have all the protections of the Affordable Care Act, and that people with preexisting conditions might not be accepted. Lawmakers have acknowledged those possibilities, but are presenting this as a stopgap measure pending a larger fix by the federal government.”
 
Updates to SF 2349, as well as information on other legal issues and topics that affect the agriculture industry in Iowa, can be found through the Iowa State University Center for Agricultural Law and Taxation.
 
About the Authors:
 
Kristine Tidgren
Center for Agricultural Law and Taxation
515-294-6365
ktidgren@iastate.edu 

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