How valuable is a health benefit plan that can’t be called an insurance policy? The law that Republican legislators passed and Reynolds signed allows Iowa Farm Bureau, in collaboration with Wellmark Blue Cross and Blue Shield, to sell Iowans “health benefit plans.” The law states that the health plan, “sponsored by a nonprofit agricultural organization . . . shall be deemed not to be insurance.”
So Governor Reynolds and her GOP co-conspirators are promoting a so-called health plan that can’t be labeled as insurance. Their plan can’t be regulated by either federal or state insurance regulators. Reynolds is trumpeting a return to the ugly past when insurance companies could reject customers with pre-existing conditions and limit coverage.
The Washington Post headline said, “Iowa tries an end run around the Affordable Care Act (ACA)…or a path to substandard coverage that will divide the healthy from the sick.”
Larry Levitt, a senior vice president at the Kaiser Family Foundation, describes the Iowa Republican Plan.
“If the ACA’s insurance rules can’t be repealed, then an alternative is to get people the option of escaping them,” Levitt said.
Health care experts have warned that this might be a money maker for Farm Bureau, but customers must beware.
“If you’re collecting premiums from people who don’t use health care services very much you can make money,” said Sabrina Corlette, a health policy research professor at Georgetown University. “It’s when you actually have to cover medical services that insurance becomes a less-profitable business.”
When Reynolds signed the law in April, the Des Moines Register reported there were few specifics available.
“For example, Wellmark and the Farm Bureau could resume denying coverage to applicants if they have pre-existing health problems, such as diabetes, high blood pressure or a history of cancer. Such denials have generally been banned since 2014 by Obamacare. The bill also would let Wellmark and the Farm Bureau delete some types of coverage, such as for maternity or mental health care, from the new coverage.” –DSM Register April 2, 2018.
In April Iowa Starting Line published a behind-the-scenes legislative look by Matt Chapman about the new law. Matt described it as a, “real plan of Wellmark and Farm Bureau, to take us back to the days of pre-existing conditions where bankruptcy is the norm for those with serious illnesses…they have accomplished a public relations stunt that will give unregulated junk insurance to young healthy Iowans at the expense of our most vulnerable citizens, while at the same time they are gaslighting us by claiming Farm Bureau and Wellmark are somehow a savior in this process.”
Four months later in July 2018, the DSM Register reported Iowans are still waiting for specifics.
“The new Iowa option, which Republicans and some Democrats in the Legislature pushed through before knowing many of the details, represents another attempt by GOP-controlled states to chip away at some of the federal rules imposed under the 2010 law championed by former President Barack Obama.”-DSM Register July 12, 2018
In June, the Trump Administration’s Labor Department changed the rules authorizing the expansion of association health plans (AHPs). Business associations have long demanded to have the ability of associations to band together in health plans.
However, there has been tremendous push back on this proposal by many business groups. CEO John Arensmeyer of the Small Business Majority warns that it will weaken the ACA and hurt many small businesses.
“While the new rule may make it easier for a select number of small businesses with younger and/or healthier employees to purchase association health plans that might be cheaper in other states, the tradeoff is that this will cause the insurance market for small businesses to split in two, leading to major spikes in premiums for small firms that remain in the small group market…What’s more, these multi-state plans will offer fewer consumer safeguards. In fact, they will not have to include protections for people with pre-existing conditions nor will they be required to cover things like maternity care because they will not be subject to certain rules established by the ACA,” said Arensmeyer.
Several other major business associations are warning their members. “Buyer beware of these plans.”
This may suggest that the Farm Bureau proposal may be in trouble as well. The Farm Bureau Plan is very similar to the association plans. When customers realize that their policy may be worthless for pre-existing conditions and limited coverage they may lose their enthusiasm.
Will Reynolds and the Iowa GOP be sorry they rushed into passing an unknown and risky health plan that can’t even be called insurance?
by Rick Smith
Posted 8/10/18
9 Comments on "Kim Reynolds Sold Iowans A Sham Health Plan"
Thanks Rick Smith for laying out the deception in the Reynolds/Wellmark/Farm Bureau scheme to make take advantage of people who really need health insurance. Gov Reynolds thinks she can fool the people just by acting earnest when she says it. Health insurance is not something to fool around with. Peoples lives and life savings are at stake. I wonder if Gov Reynolds would recommend this product to one of her own children or a friend?
I think there’s a great parallel here with the water in Flint – “okay Governor, YOU drink it”.
The complete hypocrisy of Governor Reynolds and the Republican policies pushed through the legislature of this state defy reality. They wish to project a moral authority over all others; except of course if it conflicts with what they deem “worthy”. Let’s have a public press conference on this subject shall we?
So, like the Federal Government trying to pass THEIR latest end run around the ACA, our illutrious State COngresscritters, in collusion with the Governor-by-inheritance, we are also bringing back “catastophic insurance” plans? ‘Cause they’re so cheap – but if you DO happen to need to use it, chances are you won’t be covered. Or, if you are, you pay exorbitant co-pays, if your physician even accepts your coverage.
What can POSSIBLY go wrong?
This Kim Reynolds sham health plan is what may happen when any state Senate, House, and Governorship is GOP controlled…the trifecta…sad.
“When injustice becomes law, resistance becomes duty.”
–Thomas Jefferson–
You pay a monthly premium and it only covers a dr appt. Once its confirmed you have an illness ut no longer covers you. Nor does it cover prescriptions. Don’t waste your money. It’s cheaper to pay fir your 1 or 2 dr appointments a year than a premium for fake insurance
I have watched the Iowa Farm Bureau for forty years, monitoring their political and PR work, and I’m awed by their success. They are totally without shame (examples provided on request) and yet they control Iowa more completely than Big Tobacco ever controlled North Carolina or Big Coal controlled Kentucky. Maybe people who grew up in Iowa understand this. As someone who grew up elsewhere, I don’t.
Reynolds and the Republicans including their co-conspirators the Farm Bureau, and Wellmark have come up with a plan best described by one word BULLSHIT ! Of course the nincompoops that follow these fools will never all the way to their graves not believe that their best interests are being taken care of ! So it would be futile to think real facts about this sham would resonate with them !
Reynolds cannot defend her decisions to betray Iowans, so she must keep quiet during the “election” cycle — I can’t wait to read the money disclosures that bought and paid for her campaign with ALEC or Koch money.