Affordable Care Act impacts farming families

Farm families, as small business owners, often need to purchase health insurance coverage for themselves. They also often manage employees and need to make decisions about what they will offer as healthcare coverage.

The Affordable Care Act, with its many changes to parts of the health insurance system, will impact farm families in many ways.
Heidi Johnson, Dane County University of Wisconsin-Extension crops and soils educator, shared information about the program during a workshop sponsored by Landmark Services Cooperative.
Johnson said farmers rely on individual insurance policies more than the average Americans. They have fewer group plans available to them, and many farm families have one spouse working off the farm for insurance.
Many farm families also have had very high-deductible insurance plans and established health savings accounts along with the plan. The biggest concern is protecting the farm if someone in the family gets seriously ill.
The problem with this type of coverage is that families often do not get the routine care or checkups because of the cost, she said
Changes for farmers
Under the AFC, Johnson said, there are no more exclusions. There are no cancellations when someone gets sick and no more life-time or annual maximum payouts. Children can now stay on their parents' plan until age 26 if they want.
"Another benefit is that professions are not taken into account when determining premiums, so maybe farmers won't be penalized because they are in one of the riskiest businesses," she added.
"Everyone, including farmers, must now have health insurance. They are following what has been dubbed the 'play or pay' rules. If you don't enroll in an insurance plan you have to pay $95 per person or one percent of your income, whichever is higher. By 2016, the fine, or tax, goes up to $695 or 2.5 percent of the income."
The new law also requires that all children are covered with insurance.
Income estimation
The cost of insurance, when buying it through the new Health Insurance Marketplace, is based on annual adjusted income. This can sometimes be hard for farmers who generally have more unpredictable income and expenses.
"It can be difficult to guess," Johnson said. "If you overestimate, you will get a reduced subsidy. The subsidy will be a credit. If you underestimate, they will ask for more money back."
Farms and small businesses with fewer than 50 employees are not required to provide insurance, but the workers must have insurance. If an employer does offer insurance, it must be offered to all employees.
There are tax credits available to small businesses and farms offering insurance. The tax credit is based on the number of employees and how much they are making in a year.
"When you do this, you must use the Small Business Health Option Program, but it is not up and running yet, so right now you will need to go through a broker," Johnson said.
Johnson suggested utilizing the small business tax calculator, found at healthcoverageguide.org, when making these decisions.
She also mentioned the Smart Choices workbook that helps families calculate their healthcare needs annually and choose a healthcare plan that works best in their family's budget.

Brown Mang