Farmer Led Working Group – Benefits Feasibility Study

Case Studies
People Care

Introduction

Collaborating with and convening the farming community is a key component of Ocean Hour Farm’s mission. In particular, we want to elevate and support farmers to make their work easier. In the Winter of 2024, we hosted our first farmer-led working group with 7 farmers from around the region to understand their most pressing issues. Each year, we host and pay a group of land and sea-based farmers to design potential trials, pilots or research projects that Ocean Hour Farm can carry forward.

The topics addressed range from food systems-based challenges to regenerative agriculture practices with a cooperative lens.

Why health insurance?

In 2024, the Farmer-Led Working Group chose to address the challenge of narrowing the gap between the benefits farmers can offer compared to other industries to retain and attract employees. The primary gap identified was offering health insurance, a common reason farms are seen as less competitive employers.

The issue of insurance is compounding for farmers. Most employers are small businesses, and the employer also struggles to find affordable health insurance for themselves. Navigating the open marketplaces can be difficult. Understanding which plan suits your or your company’s needs is complex, and many plans are a significant portion of their monthly expenses for anyone in the industry, from farm hands to farm owners. Farming creates a lot of wear and tear on the body, making consistent health care essential for those who choose farming as their career.

Heather Meehan (@thedaisyedition), a flower farmer who participated in the group, conducted a feasibility study to identify innovative solutions from neighboring states and industries and barriers to adopting them in Rhode Island.

The following information is based on interviews conducted in 2024 with individuals who implemented these solutions. For the most up-to-date information, we recommend visiting healthcare.gov.

Feasibility Study Objectives

Assess how to give Rhode Island farmers and farm workers more bargaining power and more of a voice in systems that impact them.
Consider making farming a more viable and long-term career by narrowing the gap between farm livelihood and other industries.
Research farms and other industries that trialed alternative ways to support their employees in accessing health insurance.
Showcasing options that farm owners can explore.

RESEARCHED SOLUTIONS

Farm Direct Co-op

Location: North Coast, Massachusetts

Solution: Qualified Small Employer Health Reimbursement Arrangement (QSEHRA)

The Farm Direct Coop is a woman-led, hybrid organization that is part CSA and part food hub. It brings super fresh, organic produce from local farms to our communities.

Farm Direct Coop activated a QSEHRA, a federally available plan managed through a third-party broker, in 2023. They have had a positive experience and continue to use this solution. They use it to provide a monthly stipend to their two full-time co-directors. The employee can spend the allowance on premiums, copays, and associated healthcare costs.

Pros:
- Flexible within the employer’s budget.
- Created for small businesses of 50 employees or less.
- Allows small employers to provide non-taxed reimbursement of certain health care expenses, like health insurance premiums and coinsurance, to employees who maintain minimum essential coverage, including an individual Marketplace plan.

Cons:
- It can be a financial burden for employers.
- Subject to audits and has record-keeping requirements.
- In some cases, it could cancel out state subsidies available through the healthcare marketplace.

Yellow Farmhouse Education Center

Location: Stonington, Connecticut
Solution: Monthly Healthcare Stipend

Founded in 2017 and housed at historic Stone Acres Farm, the Yellow Farmhouse Education Center is a non-profit organization dedicated to teaching about food and farming and fostering meaningful connections both locally and globally.

They recently began offering their employees a monthly fixed health care stipend. The amount is not based on the number of hours employees work. The employer and employees all currently access health insurance through the public marketplace in Connecticut and are happy with their plans. They looked into offering a health insurance plan directly or a QSEHRA account but found that both options would provide less coverage and increase employee costs.

Pros:
- A simple way for an employer to provide a health benefit.
- Flexible within the employer’s budget.
- Allows employees to continue to access subsidized health insurance through the marketplace if they qualify.
Cons:
- Taxable for both employer and employee, this concept doesn’t allow the use of pre-tax dollars on health care.
- It increases employees’ annual income, which could impact which health insurance plans they qualify for and the overall cost of the plan.

Long Lane Farm

Location: Warren, Rhode Island
Solution: Employer-Provided Health Insurance

Long Lane Farm is a small 5-acre, no-till organic produce farm owned and managed by Devin and Camille Abdel-Nabi.

In a previous iteration of her farm business, Camille Abdel-Nabi provided health insurance for herself, her co-owner, and one employee through Healthsource RI for employers. The plan was adequate, but the business cost was around $350-400 per person per month, which they ultimately could not sustain.

Pros:
- Easy to access for both employer and employee.
- Allows employers to split the cost of premiums with their employees.
- Employer-provided insurance is often a strong employee retention incentive for full-time, year-round staff.
- There are some incentives and tax credits that can lower the cost for employers.
Cons:
- The plans available for small groups were not necessarily better than what they could access as an individual.
- Deductibles were still relatively high, and premiums can be a cost burden for both employers and employees.
- Farm owners must have at least one employee to access this; they cannot do this for themselves. Generally, this concept is more suitable for larger businesses as plans become more cost-effective with larger groups.

The Fishing Partnership

Location: Coastal Massachusetts
Solution: Healthcare Navigator Training & Support

The Fishing Partnership is a Massachusetts-based organization that, among other things, provides one-on-one health care navigation to fishermen. It helps fishing families apply for health coverage, shop for and enroll in an insurance plan, make income and household updates, and find a primary care physician. The organization began in 1997 to provide subsidized health insurance to the fishing industry.

Since the passage of the Affordable Care Act (ACA), which significantly expanded access to healthcare for individuals and families, the Fishing Partnership has focused on training Healthcare Navigators in Massachusetts to be culturally competent in working with fishing families. The Fishing Partnership also supports its clients through securing and using healthcare, ensuring that their businesses are structured correctly, appropriately reporting income, and utilizing qualified benefits. Often, their clients have been over-reporting income and qualify for more affordable plans than they realize.

American Agribusiness Association (A3)

Location: Minnesota
Solution: Labor Union Partnership

The American Agribusiness Association (A3) is a private, non-profit membership organization offering risk management and financial best practices. Through a partnership with a labor union, it also provides health benefits to its members. These benefits are available to nationwide A3 Members who join for $35 a year. The health benefits program is open to individuals, families, 1099 contractors and employees. They do not disclose specific prices, but their monthly premium rates are competitive, and all plans have very low deductibles. A partnership with Blue Cross Blue Shield offers benefits, with 98% provider acceptance nationwide.

This concept is better for employers hoping to offer full healthcare benefits to employees.. Younger individuals with lower incomes may be better off on a plan through the Marketplace, as it could be more cost-effective.

Employee Initiated Option

Solution: Health Savings Account (HSA)

Health Savings Accounts are tax-free arrangements available to individuals or families enrolled in a High-Deductible Health Plan (HDHP). In 2023 (the most recent available data), an HDHP was defined as any plan with a minimum deductible of $1500 or higher for an individual or $3000 or higher for a family. The maximum out-of-pocket deductible must also be $7500 for an individual or $15,000 for a family. Individuals can set aside tax-free money in an HSA, up to $3,850 for an individual or $7,750 for a family.

The money does not expire and stays with you even if you change jobs. It can be withdrawn, tax-free, to reimburse you for eligible medical expenses. It can be withdrawn to cover other expenses but will be subject to tax.

Pros:
- Accessible to any individual or family.
- Allows money to be put aside pre-tax for current and future medical expenses.
- It can be combined with higher deductible plans, which typically have lower monthly premiums.
- Does not expire and can be a strategy to save for future medical needs.
- It can be used as a retirement fund.
Cons:
- Puts the burden on the individual to pay for their medical expenses when they occur.
- Subject to a high tax rate if used for other expenses.
- Cannot be used to pay insurance premiums except when unemployed or over age 65.

Farmer’s Health Cooperative of Wisconsin

Location: Wisconsin
Solution: Co-op (Consumer Operated and Oriented Plan)

The Farmer’s Health Cooperative was created by the Cooperative Network, which recognized that health care is at the top of the list of concerns facing farm families and prioritized finding a quality, affordable option for farmers and agribusiness. This commitment led to the development of the Farmers’ Health Cooperative of Wisconsin. Cooperative Network worked with lawmakers and then Governor Jim Doyle in 2003 to spearhead the Co-Op Care law that allows farmers and agribusiness to join together through a cooperative program to purchase affordable, quality health care coverage.

This organization was created before the Affordable Care Act (ACA) and is unlikely to be replicated in other states unless the ACA changes significantly.

Conclusion

Our goal with this report was to research and share solutions other farms and industries have found to navigate the complexities of providing health insurance to employees. We found a few strong examples that can help farmers become more competitive compared to other industries. If you know of different options or want to share another solution that could benefit farmers, please contact us at info@oceanhourfarm.org with ‘health insurance feasibility study’ in the subject line. Additionally, we will connect with you if you’d like to discuss this topic with the author.

About the Author

Heather Meehan is the founding farmer of The Daisy Edition, a cut flower farm in Middletown, RI. She got her start at Quail Hill Farm in Amagansett NY, a 20 acre Pick-Your-Own CSA, in 2021. It was there she first fell in love with growing flowers, and she went on to hone her flower farming and floral design skills at Island Time Farm in Shelter Island, NY and as the former manager at Little State Flower Co. in Tiverton, RI.

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