In a recent national survey, farmers said the biggest threat to their livelihoods wasn't low commodity prices or global trade policies. It was the rising cost of health insurance.

It's one of the reasons why state farm bureaus have jumped into the insurance game in Iowa, Tennessee and Nebraska, and are trying to in Kansas.

Members of the Kansas Farm Bureau spend an average of 30 to 40 percent of their annual incomes on health coverage, according to KFB President and CEO Terry Holdren.

"Those are significant costs and they're larger for most folks than their average mortgage payment," Holdren told a Kansas legislative committee earlier this year.

Premiums for Tim Franklin, a farmer from Goodland in northwest Kansas, nearly doubled between 2015 and 2018 – and they're still going up.

"In 2019, we'll be paying just under $24,000 just in premiums for our family of five," Franklin said at a hearing in Topeka for which he made the nearly five-hour drive. "Please give us some options."

The Kansas Farm Bureau is behind a bill that would allow it to market non-insurance "health benefit plans." According to Holdren, these would be up to 30 percent cheaper than what's available through the federal health insurance marketplace, mainly, he said, because they would be exempt from state and federal regulations.

"This legislation … would give us the ability to say ‘no' to folks if they don't meet our underwriting standards," Holdren told lawmakers.

In other words, KFB could screen applicants and reject those with expensive health care needs, such as pregnant women or people who need substance abuse treatment or prescription drugs – things that regulated insurance companies can no longer do.

The plans are similar to those offered since the 1990s by the Tennessee Farm Bureau and to coverage that the Iowa Farm Bureau recently began marketing to its members.

The Nebraska Farm Bureau's health coverage is a bit different. For starters, it is limited to people who work in agriculture, whereas the KFB plans are available to all members as long as they pay the annual member fee.

But importantly, Nebraska also partnered with Minnesota-based Medica in order not to exclude people with pre-existing conditions. That difference, Medica Vice President Jay McLaren told Kansas lawmakers in a letter, guarantees coverage for all Nebraska farmers and ranchers who are "desperate for more affordable solutions."

It's that lack of a pre-existing conditions guarantee that has critics of the KFB plans concerned.

"We think the whole concept is unfair," said Brad Smoot, the lead lobbyist for Blue Cross Blue Shield of Kansas, the state's largest health insurer.

Allowing the farm bureau to play by a different set of rules would result in siphoning healthy individuals from the insurance pool, leaving companies like BCBS of Kansas with people who are sicker and more expensive to cover.

Segmenting the marketplace like that would force insurers that are subject to state and federal regulations to raise premiums, former Kansas insurance commissioner Sandy Praeger said.

"The only people who benefit from chipping away at Obamacare are younger, healthier people," said Praeger, a Republican who believes policymakers should strengthen the federal health reform law, not undermine it.

That's happened in Iowa, according to Dennis Maggart, executive vice president of the McInnes Group, a regional insurance firm based in Kansas City, Missouri. Average premiums for regulated plans have nearly doubled since the Iowa Farm Bureau began marketing coverage similar to what the Kansas Farm Bureau is planning, he said.

And market disruption isn't Praeger's only concern. She believes the lack of state regulation will allow KFB to change the scope of its coverage whenever it needs to rein in costs.

"Even if you saw the plan today, it could change tomorrow and nobody would have the regulatory oversight to stop it," she said.

Supporters of the Kansas Farm Bureau legislation acknowledge that the coverage it would authorize would be less comprehensive. But, they say, something is better than nothing.

"This has been one of our greatest struggles, not only financially but emotionally."

"(Farm families) are not asking us to pass this bill, they're begging us," said Republican state Rep. Don Hineman, a farmer and rancher from Dighton.

But it would provide farm bureau members - like Sarah Schmidt and her husband Jim - affordable options they don't currently have. Schmidt said they're trying to hang on to their family farm near Junction City, and health care costs are holding them back.

"This has been one of our greatest struggles, not only financially but emotionally," Schmidt said, fighting to maintain her composure. "We've come back to our fifth-generation family farm and we would like to continue there."

The bill made it through both chambers of the Kansas Legislature with the help of more than a dozen KFB lobbyists, and is now in the hands of new Democratic Gov. Laura Kelly, who must make a decision by April 26.

Still, opponents haven't given up, claiming there are technical problems with the bill's language in urging Kelly to veto it.

Jim McLean is the senior correspondent for the Kansas News Service. Follow him on Twitter: @jmcleanks.

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