Alabama lawsmakers introduced legislation in February that would allow nonprofit agricultural organizations to offer health benefits in a format that would not be regulated as traditional health insurance and would be exempt from the state’s insurance laws.
Potential members would have to acknowledge that the health benefits are not insurance and are not regulated as such. The nonprofit organizations offering the benefits would be allowed to contract with payers to transfer some or all of the risks associated with offering health benefits. If passed, the legislation would take effect on October 1, 2025.
According to a Feb. 18 op-ed from BCBS Alabama in Yellowhammer News, ALFA’s plan to offer Farm Bureau Health Plans would be free from state oversight and consumer protections, creating financial risks for enrollees.
“ALFA’s simple goal is to limit the people in their plan to younger healthy people – leaving those they deny left to pay more for the coverage that they desperately need,” BCBSAL wrote. “The Legislature should reject this proposal.”
BCBS also noted that the state’s current health insurance market is open to competition from all payers, so if the proposed legislation passes, other organizations could move to circumvent state regulations.
ALFA shared the following statement with Becker’s:
“Alabama Farmers Federation’s goal for Alfa Health Plans is to better serve our members; it’s the same mission that prompted the organization to establish what would become Alfa Insurance in 1946 to provide affordable fire coverage for farmers and their rural neighbors.
Farmers are facing a financial crisis. While the Legislature can’t affect the cost of fertilizer, diesel fuel or labor, it can authorize Alfa Health Plans, which could save farmers 30-60% on the cost of health coverage. Many of our farmers are paying as much as $2,500 a month for health coverage. This option could make the difference for farmers facing difficult decisions about the future of their family businesses.
We don’t have to speculate about the positive impact of health plans. Ten other states have passed similar legislation. Tennessee Farm Bureau has offered health plan coverage since 1947. This coverage provides all essential health benefits; has shown no negative impact on the health insurance market or premiums for those outside the plan; and has a strong record of persistence and member satisfaction. While prescreening is key to the affordability of health plans, it’s important to note health plan contracts are evergreen — meaning once a member is approved, they cannot be cancelled for health reasons.”