MONTGOMERY, Ala. — A bill currently making its way through the Alabama Legislature that would allow the Alabama Farmers Federation to offer health plans to its members was met with great support and opposition Wednesday during a public hearing.
Sponsored by Rep. David Faulkner, R-Mountain Brook, House Bill 477 would allow ALFA to offer a health insurance-like plan for its members, without being classified as a health insurer. The bill is needed, Faulkner has said, to help offset the rising costs of health insurance for farmers, who are often self employed and without employer-provided health insurance.
For the bill’s critics, however, which includes the American Cancer Society, the American Lung Association and others, the plan lacks adequate consumer protections, as the bill would permit ALFA to deny coverage based on pre-existing conditions.
Both sides had their say Wednesday in the Senate Banking and Insurance Committee public hearing.
“Members, senators, HB477 is by far the most comprehensive farm bureau legislation in the country,” Faulkner said.
“You can look at all ten states that have enacted this, (and) our bill is far more comprehensive, (and) includes far more regulations. It offers the best consumer protection, the strongest coverage guarantees, the most oversight and the greatest financial contribution to state budgets.”
The bill passed overwhelmingly in the House last week after a provision that would have given the Alabama Department of Insurance enforcement powers over the ALFA plan was stripped out from the bill. Opponents to HB477 have largely pointed to this lack of oversight for the plan as their main concern.
In an effort to understand the viewpoint of those against HB477, Sen. Andrew Jones, R-Centre, asked Faulkner to clarify what enforcement mechanisms did exist for the bill.
“The way I read it is that feedback from (Department of) Insurance is more of an advisory opinion, there’s really no teeth in that?” Jones asked. “…I guess it’s up to ALFA whether they take that or not, am I right on that?”
“Well, yeah,” Faulkner said. “Or the policy holder.”
The public hearing kicked off with Kristie Nelson, a farmer and proponent of the bill, who urged lawmakers to support the bill, as written, to grant her family the economic stability she said would come with being able to enroll in a health plan specially curated for the self-employed, particularly those without consistent incomes.
“Rather than supporting farmers and small businesses, the current system discourages investment, job creation and success,” Nelson said. “With the option of an ALFA health plan, we could rest easy knowing that our insurance premiums would be stable, (and) could budget accordingly.”
Several more farmers would go on to speak in support of the bill, citing similar hardships of having to purchase health insurance on the private market, which for a family of four can reach costs of around $1,500 a month.
Just as many speakers, however, spoke against HB477, including Ted Hosp of Blue Cross Blue Shield of Alabama, who said the bill offered “no meaningful recourse” for plan enrollees denied coverage. Also speaking against the bill, Ashley Lyerly of the American Lung Association noted that the plan would not cover maternity or newborn care, pediatric services, preventative and wellness services, including chronic disease management, or rehabilitative services, and could pose serious health risks to enrollees.
“These plans expose enrollees to significant health and harmful risks inherent in substandard coverage without any consumer protections because it lacks any enforcement and oversight by the Department of Insurance,” Lyerly said. “Farm Bureau plans need to cover all essential health benefits and be regulated by the Department of Insurance.”
Two committee members – Sens. Merika Coleman, D-Pleasant Grove, and Rodger Smitherman, D-Birmingham – shared in the concerns over the lack of consumer protections in the bill. Smitherman suggested the bill would need to have more consumer protection for it to garner his support.
“The number one priority for any corporation, not just ALFA, is to make money,” Smitherman said.
“It’s the profit, that’s what the business is there for, the priority is not the consumer, the priority is to make money. I’m concerned about those consumers in this situation here where they don’t have a recourse.”
The bill was not voted on Wednesday, but will have to pass out of a Senate committee before being brought to the Senate.
Rep. Frances Holk-Jones, R-Foley, who introduced the aforementioned amendment that would grant the Department of Insurance oversight over the ALFA plan, which was later removed in the House, told Alabama Daily News Wednesday that she respected ALFA’s efforts to help farmers, but was still hopeful that bill could reach a point as to satisfy all parties.
“I’m very respectful of (ALFA) stepping up to the plate to do this because it is a problem, we definitely need some more competition,” Holk-Jones said.
“I think everybody’s really passionate on both sides of it, so we’re just trying to make it the best bill it can be.”