New health insurance plan for ag. workers

Many farmers in Minnesota, along with other small business owners, have been waiting a long time to become eligible to participate in group plans that offer health insurance. Rep. Paul Anderson says up until now, most had to purchase their coverage on the individual market, which has seen huge premium increases in recent years. It appears, for farmers at least, the wait is over as a new health plan is about to begin offering coverage to producers of agricultural products.

The new plan is called 40 Square, a member-owned and self-funded entity, that will start with open enrollment the first of November and coverage on Jan. 1 of 2018. To be eligible, one must produce an ag commodity and file either a Schedule F or a Form 1065 on their tax return. In addition, a farmer must also have at least one “common law employee.” That would include nearly anyone who did any amount of work on the farm. The caveat here though, is that the number of hours worked or the wages paid don’t matter. The only stipulation is that the employee must be issued a W-2 tax form.

This feature is unique as it differs considerably from the requirement for being eligible for group coverage, which required at least 20 hours of work per week by the employee. With this new plan, regular employees who work at least 30 hours a week must be offered coverage, but there is no requirement for cost-sharing by the employer.

Producers taking part in 40 Square must sign up for at least three years. Stock must be purchased to make the producer an owner in the plan. Each farm must purchase one share of voting stock for $100, in addition to one share of common stock for $1000. Proceeds from the common stock will be put into a trust, which goes to help fund the plan.

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