When it’s time to choose insurance policies, farmers can often find themselves considering some uncomfortable questions.
“The question would be, do they have anyone else who can come in and step in?” asks T.J. Sullivan, owner of Huggins Insurance in Salem, Oregon. “If they got cancer, and they couldn’t farm, what would that do to their family?”
That’s where disability policies come in.
“The ability to preserve that income while you get healthy is huge,” says Matthew Woodbridge, a producer at Valley Insurance Professionals in Salem. “All the operating costs that happen day-to-day, you either have to take care of it from home or pay someone else to do it. Disability funds can help maintain that income and keep the business going.”
Health insurance presents its own challenges — both choosing an individual policy and figuring out what benefits are required for employees.
Woodbridge helps his clients assess the options based on several questions, including how often they visit the doctor, what they tend to see them about, whether they have any chronic conditions and what clinic access is like in their area.
“Each insurance company has a network of providers,” he said. “In more rural communities, you don’t want someone to have to drive an hour just to see the doctor.”
In the case of chronic conditions, he points his clients toward carriers offering specific disease management programs.
“If someone is diabetic, that can affect their ability to work at their business,” he said, so getting them signed up for one of these programs can be beneficial to them and their farm.
For larger businesses, there is the issue of providing health coverage to employees.
“The Affordable Care Act sets the standard that if a business has the equivalent of 50 full-time employees, then you need to offer them health insurance,” Woodbridge said.
There is also a 100 full-time employee threshold — penalties for not offering insurance go into effect in 2015 for the 100 FTE level and in 2016 for the 50 FTE level.
Woodbridge suggests business owners work with an agent to help navigate through the marketplace and negotiate with carriers.
“Working with an agent also lets business owners look at all the carriers without having to research each one individually,” he said. “The agents essentially do all the legwork.”
Sullivan pointed out that business owners need to keep an eye on the status of any tax credits they might have in play with the ACA.
“Some farmers have applied for tax credits to afford the price of insurance,” he said. “But then they might end up having a bumper crop and making more than anticipated and seeing their income go way up.”
In this case, they would end up having to pay back the tax credit, so he recommended setting some funds aside.
Woodbridge added that one thing business owners and employees should keep in mind is their rights in regards to insurance.
“In the state of Oregon, you have the right to buy health insurance regardless of legal status,” he said.
In July 2014, the state approved a permanent administrative rule explicitly stating this.
“Undocumented access and the right to purchase insurance is a critical piece of the puzzle,” he said.