Farm groups lay out principles on health reform


Issue Date: September 9, 2009
Steve Adler

Seeking to improve access to health care through market reforms and to avoid strict mandates, farm groups say they will be fully engaged in the health care debate as Congress returns to session.

"The push is on for Congress to pass health care reform legislation. President Obama and the majority Democratic leadership in Congress have made health care their signature issue," said Jack King, California Farm Bureau Federation National Affairs Division manager.

While he said Farm Bureau is open to change that truly improves the overall system and particularly health care delivery to rural areas, King emphasized that legislation must also take into account the cost, the potential impact on employers and who is going to pay for it.

"Farming and ranching businesses operate on tight and at times nonexistent profit margins. Farm income is cyclical, with unprofitable years nearly as common as profitable ones. Health insurance costs are not cyclical and are an ongoing and significant expense to farmers and ranchers," he said.

"We believe that health care is primarily the responsibility of individuals and support efforts to provide all Americans with access to quality and affordable health care. We oppose compulsory national health insurance and a government-run health plan and favor instead tax incentives and market reforms that will expand health care coverage and hopefully rein in the costs."

There are five bills currently circulating among congressional committees—three in the House and two in the Senate. The bills are expected to receive a lot of attention this week, now that elected officials have returned from their summer break. According to King, members of Congress got an earful during meetings they held during the summer recess.

"The clear message was to go slow and consider all the consequences before making changes," he said.

Jim Rietkerk, a San Bernardino County nursery operator and chairman of the CFBF Labor Advisory Committee, said that right now is an important time for farmers and ranchers to have their concerns heard by members of Congress.

"We need to be very engaged in the process. When our Farm Bureau delegations go back to Washington or comunicate with their representatives, this should be No. 1 on their agendas. If we sit back and say 'no' to everything, that's not a solution," he said. "Some of what happens we won't like, and some of it may not even be in accord with our policy, but that doesn't mean we shouldn't be in there trying to make it as doable for us and survivable for us as possible."

Rietkerk said that whatever evolves with health care reform needs to be national in scope; otherwise if one state adopts something and another state does not, it creates a competitive advantage for one state over another.

Another concern is what direction insurance coverage takes for seasonal workers, who may work at one farm for a few weeks before moving to a new job on another farm in a different region or state. For many farmers, providing coverage for these employees could create a bookkeeping nightmare.

"How do you do that? How do you afford that, especially with the prices of commodities that people are getting today? The complexities need to be thought through and I don't think the current proposals are addressing all the complexities," Rietkerk said.

Farm Bureau has expressed the following positions relating to health care reform:

  • Support tax incentives and tax deductions for health insurance payments for self-employed individuals, including the elimination of the 7.5 percent adjusted gross income so that all medical expenses can be deducted, and a deduction can be made against the 15.3 percent self-employment tax.
  • Oppose compulsory national health insurance and a national health plan.
  • Support personal incentives (such as health savings accounts) and market reforms that will expand health-care coverage.
  • Support wellness programs and preventive care.
  • Oppose strict mandates requiring employers to provide health insurance or pay into a health care account.
  • Support equitable Medicare payments to rural hospitals and physicians.
  • Support regional insurance purchasing cooperatives.
  • Support a small employer credit for those who provide insurance to their employees.

"We will be weighing in on a lot of these different issues, but I think generally what we will do is express broad principles that are important to the farm community," said King. "We will inject ourselves into the debate, but we will do it primarily as an expression of things that are important to us and things that we can support and things that we definitely oppose. We will make our position very clear to Congress."

King emphasized that any health care reform passed by Congress must not unduly burden farm and ranch businesses or impose costs that they cannot afford. Farm Bureau supports tax credits to help farmers and ranchers who struggle to provide insurance for their employees. However, requiring employers to provide insurance coverage or make mandated payments will put added financial strain on already struggling farm and ranch businesses, he said.

Rietkerk agreed. "There are a lot of farmers and ranchers and other independent people who really can't afford it for themselves, so a mandated insurance program might be at a cost that they may not be able to handle," he said.

The disparity between health coverage for people in rural areas as compared to their urban counterparts needs to be addressed in whatever reform takes place, King said. According to the Department of Health and Human Services, 20 percent of Americans live in rural areas but only 9 percent of physicians in America practice in those settings.

"Many rural residents depend on small, rural hospitals that face unique health care delivery challenges due to their size and case mix," he said. "Medicare reimbursements are currently lower in rural areas. Transportation needs are also pronounced among rural residents, who face longer distances to reach health care. As a result, data show rural residents are less likely to receive recommended preventive services and report, on average, fewer visits to health care providers."

King said that CFBF would be closely following developments in Congress during the next several weeks.

"They are trying to come up with a bipartisan bill, but they have not been able to settle differences or agree to a time frame. But there is that sense that if they don't move ahead, it is going to start to fall apart," he said. "The majority of members of Congress, especially the moderate 'Blue Dog' Democrats, will urge caution. They will want to proceed, but they won't want to rile the waters any more than they are already riled."

(Steve Adler is associate editor of Ag Alert. He may be contacted at sadler@cfbf.com.)

Permission for use is granted, however, credit must be made to the California Farm Bureau Federation when reprinting this item.