This bill was passed by the Indiana General Assembly and signed into law Governor Holcomb on March 21, 2020.
What is this law? This law authorizes a non-profit agricultural organization (Indiana Farm Bureau) to provide health benefit coverage that is:
- Sponsored by the non-profit agricultural organization or its affiliate
- Offered only to members of the non-profit agricultural organization and their families
- Deemed by the non-profit agricultural organization to be important in assisting its members to live long and productive lives
- Offered in every county in Indiana
- Provides that non-profit agricultural organization coverage is not insurance and is not subject to the regulatory authority of the Indiana Department of Insurance
- The non-profit agricultural organization providing health coverage is not engaged in the business of insurance and is not required to obtain a certificate of authority
- An individual may not apply for health coverage until the individual has been a member of the non-profit agricultural organization for at least 30 days (dues are $32.50 per year)
- Since this is not health insurance, it is not required to meet the mandates of the ACA. However, this health coverage is mandated to cover:
- Ambulatory Patient Services
- Emergency Services
- Laboratory Services
- Annual Limit of $2,000,000
- Must file annually with the Indiana Department of Insurance a written and signed opinion of a qualified Actuary that the Plan Reserves are adequate and conform to the appropriate actuarial standards of practice and to reinsure all or a portion of its risks
- The individual entering into a Health Coverage Contract with the non-profit agricultural organization must acknowledge in writing that the Health Coverage is not considered insurance and is not subject to the administrative rules of the Indiana Department of Insurance
There were only two groups that fought this bill: MHS (Ambetter) & CareSource. These are the only two Health Insurance Companies in the Indiana Federal Marketplace (Exchange). After recently having conversation with Christina Hage, (Sr. VP of External Affairs for MHS) and Joey Fox (Joey Fox Consulting – representing CareSource), their primary concerns are:
- Unfair advantage in the market, products subject to the ACA & product not subject to the ACA (the Indiana Farm Bureau Health Plan does not cover:
a). Pre-existing conditions
c). Prescription drugs
d). Essential health benefits (except those mentioned)
- No Regulatory Body to regulate this product
- No Definition of Membership
- Could encourage other organizations to create copy-cat products to mimic the Indiana Farm Bureau Health Plan
- Ambetter & CareSource must file their 2021 Rates with the Indiana Department of Insurance by the end of July. Indiana Farm Bureau Health Plan is not required to file rates with the Indiana Department of Insurance.
- The Indiana Farm Bureau Health Plan has stated that they will begin to accept applications in October 2020 with an effective date of January 2021.
The purpose of this communication is to inform the members of ISAHU of this new plan as you will most likely run into it in the Individual Health Insurance Market this Fall.
ISAHU is concerned that the high price in the Marketplace (Exchange) and as these prices continue to climb, more Indiana consumers are going to be looking for other options (short term medical plans and Farm Care). ISAHU is not opposed to more options, but we want to make sure that the options are good for Indiana consumers and that there is fair competition in the Market. It appears that “Farm Care” will be able to cherry pick who they insure (they will underwrite and can decline) and will reduce the number of Indiana consumers participating in the Marketplace (Exchange) with the young, healthy good risks leaving and the older, sicker Indiana consumers staying in the Marketplace (Exchange), the rates will continue to go up in an unsustainable manner. “In desperate times, desperate people make desperate decisions”.
If you have any questions or concerns, please feel free to contact me:
David A. Berman, CLU
Torchbearer Public Affairs