by Jordan Roberts
Former Director of Government Affairs, John Locke Foundation
President Trump signed an executive order late last year which directed federal agencies to create more options for people to purchase health insurance. Since then, the federal government has made several moves which have laid the groundwork for more choices for Americans. The administration’s rule on association health plans (AHP) went into effect this summer and it has already created new opportunities for people to offer and buy coverage:
Land O’Lakes, Inc. is the first organization to sponsor a self-insured multi-state group health plan under new Association Health Plan (AHP) Regulations that were issued this past summer. This self-insured arrangement now offers coverage to farmers of participating co-ops and individual dairy farmers within the Land O’Lakes network in Minnesota and now, Nebraska.
In 2017, a Minnesota-specific statute afforded Land O’Lakes the opportunity to develop a group health plan for individual farmers within its network. In 2018, through a partnership with Gravie, a Minneapolis-based benefits marketplace, this pilot group health plan was offered to 12 Minnesota-based Land O’Lakes co-ops and to its dairy farmers. In 2019, this plan is expanding to nearly 15,000 additional eligible farmers in Minnesota and 28,000 farmers in Nebraska who are members of cooperatives that opt-in to participating and offering coverage.
Farmers participating in the Land O’Lakes Cooperative Farmer Member Health Plan can choose from several ACA compliant plans — all of which cover each of the ten Essential Health Benefits (EHBs), have broad network coverage and are more affordable than plans offered in the current individual market. As ACA and ERISA compliant plans, those with pre-existing conditions are not barred from participation, nor will premiums be developed based on a particular participant’s health condition.
“For years Land O’Lakes has recognized the need for affordable, comprehensive health care options for our producers and farmers. Now we have an option for those in Minnesota and Nebraska,” said Pamela Grove, Sr. Director of Benefits.
We know that our co-op members see the importance of this offering given that so many have opted to participate and provide access to these benefit plans for their member farmers. We look forward to partnering with the Nebraska Insurance Department and appreciate their work in helping us provide affordable and comprehensive health coverage to Nebraska farmers. We hope to work closely with other state regulators as we look to expand.”
This is the second health plan sponsored by Land O’Lakes to specifically offer a health care solution to those in the Land O’Lakes system. In 2011, the company launched a fully-insured plan to certain agriculture member co-ops who wished to offer coverage to their employees. This plan now covers nearly 12,000 individuals in 13 states. The company intends to continue to grow this new solution for its member producers and farmers within its cooperative system.
This is exactly the sort of innovative plan that the rule is supposed to encourage. AHP’s allow small businesses to organize and create health plans that receive the same favorable regulatory status as large group health plans. The rule gives companies the power to create and offer health benefit plans that more closely resemble the needs of the population’s they are covering. I expect to see more businesses such as Land O’Lakes create similar association health plans that are now allowed under the new rules.