Farmer members with Land O’Lakes in Minnesota and Nebraska have access to health insurance through the co-op’s farmer-member health plan.

This year, the U.S. Department of Labor expanded access to affordable health coverage for self-employed individuals and small employers through a new and improved Association Health Plan (AHP) regulations.

Gravie is a Minneapolis-based benefits marketplace that works with groups and associations, such as Land O’Lakes, to help start and sustain an AHP.

In this Q&A, Marek Ciolko, Gravie co-founder and COO, explains what these new AHP regulations are and ultimately, what they mean to farmers.

What are the new AHP regulations?
An Association Health Plan is a specific type of group health plan that is sponsored by a group or association of employers, instead of a single employer, to provide health coverage to the employees of the AHP’s employer members.

Last October, a presidential order directed the secretary of labor to issue regulations or revise existing guidance to allow more employers to form and join AHPs. As a result, the labor department issued the following regulations that:

• expanded the criteria under which an AHP can be considered a bona fide employer group, allowing it to operate as a single health plan
• expanded the eligibility criteria to allow self-employed individuals to join the AHPs
• maintained current nondiscrimination provisions under the Health Insurance Portability and Accountability Act and the Affordable Care Act
• reinforced safeguards that prohibit AHPs from discriminating against employer or self-employed individual members based on health factors
• maintained the existing scope of oversight of AHPs by the states

Solutions that the new AHP regulations have introduced?
The new regulations have enabled the formation of AHPs by existing or new associations that would not have been able to sponsor a health plan under previous regulations.

An association can now be formed for the sole purpose of offering an association health plan to its members.

A key benefit of joining multiple small employers and self-employed individuals into an AHP is that they become a part of a large employer group, which allows them to:

• avoid regulatory restrictions that pertain only to the small group market
• reduce administrative costs through economies of scale
• strengthen their bargaining position to obtain more favorable deals from insurers
• enhance their ability to self-insure
• offer a wider array of insurance options

How can farmers take advantage of the new regulations?
The farming industry is largely composed of small employers and self-employed farm owners. The new rules allow farmers to join together to form an AHP and to take advantage of the benefits that have previously only been available to large employers — enhanced buying power, benefit design flexibility and administrative efficiency. Furthermore, AHPs bring additional choice to rural areas, where the individual health insurance market may have a very limited choice of health plan options. Farmers pursuing the AHP route can get in touch with a resource such as Gravie to help them assess their plan options and costs.

What considerations should farmers keep in mind when deciding if an AHP is a good fit for their needs?
It is very important for anyone shopping for health insurance to carefully consider his or her individual needs, as well as the needs of the family members who will be covered under the policy. AHPs typically offer a range of health plan options ranging from cheaper high-deductible offerings with more restrictive coverage to more expensive plans that offer more comprehensive coverage. It is also important for farmers to evaluate the AHP options against health plans that may be available on the individual insurance market in their area before making the final decision.

Some of the key considerations are:

Cost. Farmers should consider the cost in terms of the monthly premium as well as any deductibles, co-insurance and co-pays. It’s also important to understand the maximum out-of-pocket expense that may be incurred under the plan during the year.

Choice of providers. Different plans vary widely in their choice of contracted providers, so it’s critical to confirm whether any specific physicians, facilities or other healthcare providers are included in the plan’s network.

Prescription drug coverage. Plans may vary in their level of coverage for specific drugs, especially as it relates to more expensive brand-name medications. It’s also important to understand any rules that may be imposed by the plan for specific medication or classes of drugs (e.g. step therapy).

Eligible Land O’Lakes farmer members of participating co-ops in Minnesota and Nebraska have access to the co-op’s Farmer Member Health Plan. Gravie can help other affinity groups and associations in states where it's allowed to set up an AHP, similar to the LOL arrangement.

Eligible co-op members can sign up during the open enrollment period. Open enrollment for 2020 will take place in the fall of 2019.

For more information, visit gravie.com or call 844-538-4690.