Iowa Gov. Kim Reynolds signed a controversial bill on April 2 allowing sales of health care coverage exempt from state and federal regulations, including the Affordable Care Act. The Iowa Legislature passed the bill to create affordable health plan options for Iowans who can’t afford to buy health insurance.

The new law allows Iowa Farm Bureau and Wellmark to develop plans to provide Iowans access to a health care benefit that is more affordable than the current unsubsidized premiums under ACA.

Senate File 2349 allows health plans created by associations of employers or sponsored by certain agricultural organizations. In her Condition of the State address in January, the governor called for lawmakers to work together on a bill to give Iowa farmers, small-business owners and their employees access to affordable health care.

Before ACA took effect, Iowa had a healthy individual insurance market. “There were nine carriers, with good participation and reasonable premiums,” says Craig Hill, president of Iowa Farm Bureau. “Today, the state’s market is in collapse. Premiums went up 57% last year, forcing many Iowans to choose between going broke or going without insurance. As a result, 26,000 Iowans who previously bought health insurance on the individual market dropped out this year.”

SF 2349 allows Farm Bureau to build a self-funded health benefit arrangement that will work for Iowans forced from the individual market, Hill says. It also gives small employers the ability to band together to create affordable health care options for their employees.

“Thank you to Farm Bureau for their work and willingness to provide relief to Iowans who can no longer afford their health insurance,” Reynolds said at the bill signing ceremony. “Thank you also to Iowa Insurance Commissioner Doug Ommen for his leadership on this issue. Because of this bill, thousands of Iowans will now have affordable health care coverage.”

SF 2349 passed the Iowa House on March 21, 69-30, and the Iowa Senate on March 27, 37-11.

Pre-existing conditions possibly denied
The bill allows Wellmark Blue Cross & Blue Shield to partner with Iowa Farm Bureau to sell this new type of health policy. The bill defines the new coverage as not technically health insurance. It won’t be regulated by the Iowa Insurance Division, and it won’t have to comply with rules under ACA, also known as Obamacare.

For example, Wellmark and Farm Bureau could resume denying coverage to applicants if they have pre-existing health problems, such as diabetes, high blood pressure or a history of cancer. Such denials have generally been banned since 2014 by Obamacare.

The bill would also allow Wellmark and Farm Bureau to delete some types of coverage such as maternity or mental health care, from the new coverage.

Supporters say the bill should provide relief for consumers who need individual insurance policies but who make too much money to qualify for Obamacare subsidies to help pay the skyrocketing premiums. For a single person, the annual income limit for those subsidies is about $48,000.

Cost of health care No. 1 concern
About 150,000 families belong to Iowa Farm Bureau. “Our annual membership survey shows the cost of health care is the No. 1 concern facing our members,” Hill says. “This legislation came together because our organization exists to serve its members. Although it isn’t meant to be a solution for all, we are pleased that lawmakers and the governor agree it is an option for thousands who need an affordable health plan that works until Congress passes a permanent solution to the ACA-inspired health care coverage crisis.”

To be eligible for health care plan covered offered in SF 2349, Iowans need to be Iowa Farm Bureau members. Farm Bureau, a century-old organization with offices and membership in every county in Iowa, has provided individual health insurance to Iowans in partnership with Wellmark since 1969, prior to ACA implementation. This legislation continues that decades-long partnership, says Laurie Johns, Farm Bureau public relations manager.

Johns says the legislation will not diminish the impact of ACA for people it helps; they will continue to have their subsidized coverage through ACA. Instead, SF 2349 provides an opportunity to create coverage for Iowans who don’t qualify for the ACA subsidy or have been forced out of the market by exorbitant premiums. The measure comes at a critical time as Iowa farmers face a fourth year of high production costs and low market prices for commodities. However, Farm Bureau leaders say SF 2349 can bring relief to Iowans well beyond the farm gate.

“We’ve been hearing from our members about the financial burden of getting health care coverage as they took on a second or third job to pay premiums that inexplicably climbed 300%. Many more had to forgo coverage all together because they didn’t qualify for ACA subsidies. That’s just not workable,” Hill says.

Benefits may be available by January
“I don’t mind paying more than my share to help stabilize the marketplace, but there is no reason that a healthy 32-year-old should be paying more for health insurance than her mortgage,” says Rose Danaher, an Iowa County Farm Bureau member who farms near Amana.

“We’ve heard from thousands of members who share similar stories. We’re pleased lawmakers and the governor passed this critical measure,” Hill says. “Signing this legislation provides the path for us to move forward with Wellmark and begin to develop the new health care plans. There will need to be underwriting, not everyone who applies for the new plan will be approved. And not everyone will save money. If you are in a subsidized ACA policy today, you may want to stay there. But we will be able to help lots of people who aren’t on an employer-based health insurance plan.”

Farm Bureau anticipates the new health plan coverage possibly being available by January, with enrollment applications opening for members in October of this year. “Wellmark will now go to work and design the policy and put it all together so it will be available when enrollment begins,” Hill says. “That’s the schedule we have in front of us now.”

For more information, visit iowafarmbureau.com/100.