Alabama lawmakers advance bill to let Alfa sell health plans outside insurance regulations

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MONTGOMERY, Ala. (AP) — State lawmakers advanced legislation Thursday that would allow the Alabama Farmers Federation to sell healthcare plans to its members that would not be considered or regulated as health insurance.

The Alabama House of Representatives approved the bill on a 98-1 vote after nearly three hours of debate. The bill now moves to the Alabama Senate.

The bill would allow the Alabama Farmers Federation (Alfa) to sell health plans to farmers and also to people outside of agriculture that join the organization.

The bill says the plans, even though they would provide benefits to pay for medical visits, hospitalizations, and other costs, are not classified as health insurance. The plans would not have to comply with Affordable Care Act requirements for health insurance plans and could deny coverage to people because of pre-existing conditions.

Opponents argued the plans would skirt the regulations and consumer protections that traditional insurance plans must abide by, creating an unlevel playing field in the industry. But supporters said the proposal would provide a needed and less expensive option to farmers and others who are struggling with high healthcare costs.

“There is little we can do about fertilizer costs or the price of cotton, but we can make a difference in one of the largest household costs for many farmer families and other citizens in Alabama — their health care coverage,” Faulkner said.

Ten other states, including Tennessee, allow similar plans, and five other states are considering such legislation, Faulkner said.

The Farmers Federation has long been an influential lobbying force in Montgomery. Blue Cross and Blue Shield of Alabama, which dominates the insurance market in Alabama, had asked for several changes to the bill.

Rep. Juandalynn Givan, D-Birmingham, said the plans are health insurance “however you frame it.” Givan, who did not vote on the bill, said its apparent purpose is to avoid federal regulations under the Affordable Care Act.

“This is a further attack on the Affordable Care Act. Alfa does not want to be associated with it,” Givan said.

Lawmakers added several changes to the bill they said were aimed at increasing consumer protections. Any monetary cap on benefits could not be less than $2 million per enrollee. The plans, while they could deny coverage to new applicants because of their health history, could not kick people off the plan or increase premiums because of a medical event.

People who have access to employer-sponsored plans would be ineligible for the plans.

Much of the debate centered on whether the Alabama Department of Insurance should have an oversight role.

Backers said the legislation would provide a boost to the state’s farmers, who often struggle with insurance costs.

Emmanuel Bankston, a 34-year-old farmer from Henry County, told lawmakers during an earlier public hearing that young people are leaving farming because of economic conditions. He said the proposal would give “another option” for health benefits.

“That could be the difference in profit on your farm,” Bankston said.