Committee hears testimony on bill to exempt Farm Bureau member health benefits from state insurance laws

The Ohio House Insurance Committee held a third hearing on House Bill 99 on a proposal that would allow nonprofit agricultural membership organizations to provide health care benefit coverage exempt from Ohio insurance laws; the committee accepted an amendment (AM-136-0363) clarifying that the coverage is not insurance and requiring written disclosures.

The amendment, offered by Representative Barhorst and accepted without objection, specifies that the health care benefit coverage provided by a nonprofit agricultural membership organization — rather than the organization itself — is exempt from state insurance laws and that applications and contracts must predominantly state the coverage is not insurance and is not subject to state insurance laws. The amendment also adds references to the Physician Health Plan Partnership Act and laws governing multiple-employer welfare arrangements to the list of statutes from which the coverage is exempted.

Proponent testimony came from Ben Sanders of Farm Bureau Health Plans in Tennessee, who said similar plans have operated in other states for decades and that Tennessee’s program covers about 100,000 covered lives. Sanders told the committee the plans target people who fall into the “unsubsidized” pool after the Affordable Care Act and estimated the Ohio program could mature to about 10,000 covered lives. “Once someone is in the plan, their individual rate and their coverage is never affected by their individual claims experience,” Sanders said, adding the organization uses “evergreen contracts” and voluntarily complies with state departments’ complaint processes.

Opponents, including Lee Almeda of the American Cancer Society Cancer Action Network (ACS CAN), argued the bill would remove consumer protections important to people with preexisting conditions, cancer patients, and others who rely on guaranteed benefits and state regulatory oversight. “House Bill 99 creates health plans that law safeguards important to diagnosing and treating cancer,” Almeda said, urging the committee not to pass the bill. ACS CAN’s written and oral testimony raised several concerns: plans could charge higher premiums or deny coverage for preexisting conditions, the Ohio Department of Commerce and Insurance would have limited jurisdiction to resolve complaints, and the products could “cherry pick” healthier consumers and destabilize the ACA marketplace.

Members pressed proponents on operational details. Sanders said Farm Bureau Health Plans in Tennessee contracts with UnitedHealthcare for a provider network, described voluntary compliance with state complaint processes, and said the organization uses risk-based capital practices and case management for catastrophic claimants. He acknowledged the plans are not state-regulated insurance in Tennessee and said the amendment’s disclosure language and standalone acknowledgment forms are used to reduce consumer confusion. Sanders also reported receiving about 250 complaints in a year while processing roughly 2,500,000 claims, a ratio he offered as context for consumer contacts in Tennessee.

Committee members cited concerns heard from other health and patient groups and asked for data. Opponents told the committee that, because the plans are not state-regulated, comprehensive data are often not collected by departments and can be difficult to obtain; the ACS CAN witnesses supplied individual anecdotal examples from other states where claim denials and premium riders followed prior treatments or screenings.

The record also includes multiple written opponent submissions from health organizations including the American Heart Association, the American Diabetes Association, the American Society of Clinical Oncology, and state hematology/oncology societies. No final committee vote was recorded at the hearing; the chair closed third hearing testimony and moved to the next bill on the agenda.

The amendment AM-136-0363 was offered and accepted by unanimous consent; no further action or vote on the underlying bill was recorded at the hearing. The committee indicated it will consider additional testimony and written materials as the bill progresses.