Iowa Correspondent

BOSTON, Mass. — According to a new USDA-contracted study, an estimated 47 million Americans. including farmers and ranchers are currently uninsured – and struggling to find adequate ways to pay for mounting health care costs.

“Family farms and ranches are small businesses,” said Bill Lottero of Boston, Mass.-based The Access Project, who’s a co-author of the study. “Small businesses are the backbone of our economy. “Escalating health care costs and the reduced financial protections gained from these costly insurance products constitute a growing concern for the economic vitality of these important American business assets.”

The 2007 Health Insurance Survey of Farm and Ranch Operators indicated that although 90 percent of more than 2,000 U.S. farmers and ranchers surveyed had some kind of health insurance, most were depleting their individual savings, incurring debt or delaying seeking their health care needs because of rising medical costs and insurance premiums.

Moreover, the study said insurance alone may not be enough to protect American farmers and ranchers from accumulating unaffordable health expenses.

“Farmers and ranchers have more financial resources than many other rural Americans,” Lottero said. “It’s clear that middle class folks with health insurance are feeling the pinch of spiraling premiums and medical costs.”

The Sept. 6 study is the first in a series of issue briefs based on a 2007 survey of farm and ranch operators in seven Great Plains states: Iowa, Minnesota, Missouri, Montana, Nebraska, North Dakota and South Dakota, all of which account for more than one-quarter of the total U.S. agricultural market.

Sanctioned by the USDA’s National Agricultural Statistics Service, The Access Project along with its partners at Brandeis University and the University of North Dakota School of Medicine’s Center for Rural Health, asked more than 2,000 non-corporate farm and ranch operators (those operating as sole proprietors or partnerships) to indicate how they were paying for their respective health care needs. The survey gathered detailed information about the characteristics of respondents’ health insurance policies, including the amount of the premiums, the level of deductibles and the services covered. According to the report, while few U.S. farm and ranch families were without health insurance coverage, only 5 percent of survey participants said all household members were without health insurance, while another 5 percent said some household member had gone without insurance during 2006.

The report also said 54 percent of the insured U.S. farm and ranch operators received their health insurance coverage through employment off the ranch or farm, while 36 percent purchased coverage directly; ten percent had public insurance coverage such as Medicare, Medicaid or State Children’s Health Insurance Program (SCHIP).

Despite the high rate of health insurance coverage, the report said 26 percent of respondents reported high out-of-pocket expenses in 2006, with half of these families spending $1,700 or more in out-of-pocket expenses.

In addition, the report had shown these out-of-pocket expenses resulted in farm and ranch families using up savings, borrowing from banks and payday lenders, incurring credit care debt, borrowing against a home or the farm, and withdrawing money from retirement accounts – with one in five (or 20 percent) incurring medical debt, or bills from hospitals, physicians, dentist and other providers that they were unable to pay.

Case in point: Yvette Oloff and her husband have raised cattle and row crops on their Persia, Iowa farm for nearly 25 years. Despite having good insurance through her off-farm job, she was no longer able to use her benefits when she was diagnosed with a carcinoid tumor in 2001.

While Yvette and her family maintained their insurance coverage offered through her employer for as long as the law allowed while she was unable to work, after it stopped, she was surprised to learn her insurance didn’t cover pre-existing medical conditions.

As a result, over the course of four years, the Oloffs have incurred over $24,000 in debt to pay for their farm expenses and insurance premiums, which depleted their savings.

“We cut back, stay home more and borrow money,” said Yvette, who avoided care for her continued breathing problems. “Premiums are outrageous. We pay $10,000 per year. Instead of affording a new pickup, we go into debt for our health insurance.”

Alana Knudson, associate director for research at the University of North Dakota School of Medicine’s Center for Rural Health and a co-author of the study, said increasing medical debt not only strains U.S. farm and ranch families, but also health care providers.

“Many rural health care providers operate on very slim margins, and carrying debt impacts their viability,” he said.

Mark Rukavina, director of The Access Project, said the group’s results challenge health care policy proposals that seek to eliminate benefits and allow the sale of insurance policies with limited coverage.

“This report clearly demonstrates that out-of-pocket expenses must be taken into account along with insurance premiums when determining if a policy is affordable,” he said. “Policymakers must look for solutions that will ease rather than aggravate the increasing burden of health care costs for rural families and businesses.”

The briefs are slated to be released sometime between this fall and winter.

For more information about the report, visit www.accessproject.org