Obama administration officials promised that rural residents, in particular, would see reductions in their health insurance rates. But North Carolina’s farmers are still waiting to see.
By Brenda Porter-Rockwell
Shiloh Avery and her partner, Jason Roehrig, grow certified organic fruits and vegetables at Tumbling Shoals Farm in Millers Creek, just east of Boone, and they’re eking out a living on the land.
“Farming is good, but it’s not a lucrative career choice,” Avery said.
Nonetheless, Avery and Roehrig elected to put aside some money for health insurance, and they’re certainly glad they did.
Roehrig was badly burned in an on-farm accident and spent a weekend in the hospital. The pair said they will struggle to meet the $5,000 deductible required of their current health plan, but know the outcome could have been more of a financial burden had they not had insurance.
The two, both former Peace Corps volunteers, are now among those who are anxious to sign up for the Affordable Care Act, or, as it’s now commonly known, Obamacare.
“I would never even consider not getting insurance under the Affordable Care Act,” Avery said.
But as North Carolina farmers begin enrolling through the online health insurance exchanges, uncertainty prevails.
The benefits for rural communities are as yet unforeseen. Many may find they have more health care options.
But many rural counties have some of the highest individual insurance rates in North Carolina – and will continue to under the new law – and the effects on costs for farmers are also unclear.
“We just don’t know right now,” said Ted Feitshans, an extension associate professor at N.C. State University’s department of agriculture and resource economics, part of the College of Agriculture and Life Sciences. “I think more than anything else, there’s still a lot of confusion in the farm community.”
Help for farmers
The College of Agriculture has been holding small group meetings and presentations at their Green & Growin’ shows, while East Carolina University’s North Carolina AgroMedicine Institute (AMI) has been meeting farmers to answer questions.
According to AMI’s website, 29 percent of the state’s agricultural population (operators and non-migrant workers) do not have health insurance – almost twice the rate of those in other industries. Further, according to AMI, farmers who are insured report health care premiums ranging from $500 to $1,200 a month per person, with deductibles as high as $5,000.
One of the goals of the Affordable Care Act (ACA) is to help make health insurance coverage affordable and accessible for the approximately 60 million Americans who live in rural areas.
The federal Department of Health and Human Services has said the health insurance marketplaces will help to lower costs by increasing competition, especially in the 29 mostly rural states in which a single insurer currently dominates more than half of the health-insurance market.
AMI’s interim director, Robin Tutor-Marcom, said she’s fielded many questions leading up to the opening of the federal health care exchange.
As with any new program, she said, farmers have questions: “Does this program really apply to me?” “What’s the catch?” “I don’t use a computer – how can I apply?” “Can I get tax credit for paying for insurance for my employees?”
Access to insurance
Most farmers, especially smaller-scale farmers, currently go without insurance, said Scott Marlow, executive director of the Rural Advancement Foundation-USA (RAFI-USA), a farming advocacy organization based in Pittsboro. RAFI-USA works with about 100 to 120 farmers each year who are in immediate danger of losing their farms because of health care-related debt.
“We estimate that in 80 percent of these cases, health care costs are a major driver of farm loss,” Marlow said. “It does not take a major illness, although farmers are certainly not immune to major illness. All it takes is for them to have something happen that puts them in an emergency room and lays them up for a little while.
“Between the costs of the health care and the costs of hiring labor to replace their work, they will be in big trouble.”
Avery said she and Roehrig had long considered canceling their current insurance plan to save money, but never got around to it. After Roehrig’s accident though, she said she’s grateful they didn’t.
“I only took out health insurance because I knew our families would break themselves trying to help cover our health expenses,” Avery said. “We couldn’t see letting them do that.”
And in the wake of a major accident, she said, the ACA will help keep their minds at ease. In addition, Avery anticipates that they will qualify for federal subsidies that will bring their rates down under the new law.
NCSU’s Feitshans said that, like many others, farmers remain skeptical about benefits and costs under the ACA, but nonetheless are hoping for the best in terms of securing affordable, individual coverage.
“People who haven’t been able to get health insurance are cautiously hopeful,” he said. “People who have children can now keep their children insured on their plan until age 26, so that makes them happy.”
Having used a free online calculator, Avery said she expects their new payment to be about $70 per month, less than half of what they are currently paying for a high-deductible, catastrophic-event plan.
“I’m sure this will be a huge benefit for us,” she said. “We’re going to get better coverage at a lower cost.”
According to Avery’s research, the new plan she intends to sign up for will cover up to 75 percent of their medical costs.
“Once people get past the hype that’s been in the media and they start to investigate the details of the available coverage, I think they’re finding they’re pleasantly surprised with the outcomes,” said Brock Slabach, senior vice president for member services at the National Rural Health Association, a Leawood, Kan.-based nonprofit focused on rural health issues.
“Once an individual signs up for the policy, there is a risk of premiums increasing over what they’re currently paying. But the reward is better, more extensive health care coverage,” he said.
As part of the new legislation, all of the plans will cover, at minimum, 10 essential levels of services. Further, the ACA spreads the risks associated with covering an individual throughout the community. The calculations for the associated premiums will not rest solely with the individual, but now within the community.
“If you’re a small farmer, I think the ACA is ideally suited for that individual. First, you have access to a community-rated product. Next, you get the benefit of the price of your premium being adjusted to your income,” Slabach explained.
He said the available subsidies can cover up to 94 percent of the premium.
“So if you make about $12,000 per year in income, then you could be eligible for a premium of 6 percent out of your pocket. The other 94 percent is subsidized,” he said.
And unless you have 50 or more full-time employees, you’re not required to provide them with insurance.
‘Ignore the media hype’
Farmer Gregory Adams said that, reluctantly, he will sign up for the plan before the January 2014 deadline. He’s unhappy with the individual mandate, which requires that most people obtain health insurance or pay a tax penalty.
“I’m unsure right now what’s going to happen,” he said. “I don’t like the individual mandate part. But I’m going to do it and hope it will equal out somehow.”
Adams earned an undergraduate degree in history and a master’s in finance. He returned to the family farm in Benson two years ago as he figured out his next career move.
His current insurance plan includes a $3,000 deductible and payments of $95 per month. His Blue Cross and Blue Shield of North Carolina insurance broker told him to expect his monthly premiums to double under the ACA.
But Slabach said rate reductions similar to what Avery and Roehrig are anticipating will likely be what most farmers can expect from the new law.
“My advice is to ignore the media hype, sign up, see what happens,” he said.
“We recommend that farmers who think they may be eligible in the marketplace apply,” she said. “If they don’t apply, then they certainly will not know the outcome.”
AMI assists farmers individually at their convenience to answer questions and help with the application process, or can refer them to someone who can.
“Through the AgroMedicine Institute, we are happy to come to the farm, meet them at their local cooperative extension office or at another location that is preferred and convenient to them,” Tutor-Marcom said.
AMI assures farmers that every effort is made to ensure that personal information is kept confidential and secure and makes them aware that they can apply online, by phone or in writing.
Cover photo of North Carolina barns by Donald Lee Pardue