The influence of the Bible Belt on the farming community has been significant, but now farmers can turn to their churches for health care. For agribusiness owners, health care costs have been a large detriment to the bottom line. But by teaming with other worshippers in their ministries, farmers are able to establish more affordable health care options.

Health care-sharing ministries, as they’re known, are religious-based health care options that work in a unique way. Instead of premium payments going toward a policy, members send premiums directly to other members who need the money to pay medical expenses.  Current estimates show that around 100,000 people are currently enrolled in this type of plan. The members send more than $60,000,000 annually to each other for health care expenses. Those who belong to such faith-based health care groups say it’s working.

However, such unique health programs may soon face a penalty for opting to go with a program outside what’s considered acceptable as defined by Congress. Current legislation on health care includes a 2.5 percent income tax penalty for health care purchasers who don’t participate in a qualified health care program, such as Medicare. What constitutes a qualified plan? One that includes consumer protection and oversight by licensed insurance professionals.

And it’s a valid consideration when one is choosing health care coverage. While faith-based ministry plans may seem like a practical solution to the private health care programs, oversight and consumer protections safeguard the insured’s premium dollars. Insurance companies are required to maintain reserves of capital in place to pay claims. In the event of a major series of claims that may cost $1,000,000 the carrier has the ability to pay this claim. This is a major concern, as these ministries do not maintain this type of reserve and thus cannot provide the protection to the consumer. Also, regulation is key to ensuring the coverage limits individuals and agribusinesses need.

If health care costs are a concern for your agribusiness, contact your agriculture insurance broker. There are cost-effective options available that can give you and your employees’ coverage without taking a huge chunk out of your operating budget. Don’t overlook the need for consumer protection and insurance regulation. Guaranteeing your employees’ coverage is an area of loss exposure you can’t afford to ignore.

Flickr photo credit: Loci Lenar

Filed under: Agribusiness by afis blogger