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Dairy Directors’ Leadership Conference April 4, 2012

Dairy Directors’ Leadership Conference April 4, 2012. Presented by: Cathy Mahaffey, Executive Director. FHCW Background. Farmers’ Health Cooperative of WI: Formed under 2003 WI Act 101 Co-op Care Dedicated to serving farmers and agribusinesses with quality coverage

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Dairy Directors’ Leadership Conference April 4, 2012

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  1. Dairy Directors’ Leadership ConferenceApril 4, 2012 Presented by: Cathy Mahaffey, Executive Director

  2. FHCW Background • Farmers’ Health Cooperative of WI: • Formed under 2003 WI Act 101 Co-op Care • Dedicated to serving farmers and agribusinesses with quality coverage • A group purchasing cooperative • Medical, dental, life, disability, Agriplan • Member-owned and member-governed • 6-member Board of Directors

  3. FHCW Background • Farmers’ Health Cooperative of WI: • Launched April 1, 2007 • Offers coverage throughout the state of Wisconsin • Partnered with Agri-Services, Syracuse, NY to find insurance carrier and to provide additional services to members

  4. FHCW Background • Funding: • $450,000: University of Wisconsin School of Medicine and Public Health’s Wisconsin Partnership for a Healthier Future Fund • $79,000: Wisconsin Department of Agriculture, Trade and Consumer Protection, • $10,000: AgStar Fund for Rural America Foundation

  5. FHCW Background • Funding: • USDA Federal Appropriation • $4.45 million • Both Wisconsin and Minnesota • A portion used for start-up expenses • Remaining $4 million for “stop loss” • Very small amount of stop-loss funds used to date

  6. Who is eligible? • To be eligible for FHCW, you must: • Be 18 through 64 years old, and • Live or work in Wisconsin, and • Actively work in production agriculture so that at least 66 percent of income is derived from farming. (WI tax schedules F or C) • An agribusiness must be a business enterprise providing direct services to production agricultureand directly related to the production of food, feed or fiber • Dependents are covered until age 27 (26 starting 1-1-13)

  7. Partners • Agri-Services Agency • A subsidiary of Dairylea Cooperative • 30-years in business working with farmers and agri-businesses • Administers insurance for nearly 70,000 people in 48 states • Provides the following services to FHCW: • Enrollment • Underwriting • Customer Service • Premium billing and collection

  8. Partners • Aetna was FHCW’s first insurance carrier (2007-2009) • Anthem was chosen effective January 1, 2010 Anthem provides the following services: • Claims adjudication • Provider network contracting • Wellness promotion, disease management

  9. Health Risk Assessments • 839 adult members (husband, wife) received a free Health Risk Assessment (HRA) • FHCW contracted with Rural Health Initiative of Shawano County (RHI) • FHCW worked with UW-Madison to develop an HRA questionnaire specific to farmers • $200,000 of USDA money funded HRAs • “The HRA encouraged him to lose weight, he lost 40 pounds.” • “The HRA was a wake-up call.” • “I took the HRA very seriously. I came home and made huge diet changes and started exercising. I can’t believe how much I lowered my numbers.”

  10. FHCW Basics • Member dues • $6 per member per month for members who enrolled April – December 2007 • $12 per member per month members who enroll January 2008 and after • Dues are built into monthly premium

  11. FHCW Basics • Capitalization payment: • Required by law • Capitalization payment equals the first month’s premium plus 10% • Agribusiness may sign a promissory note and agree to pay the fee if they do not complete three years of enrollment • Individual farmers can pay one lump sum or be billed monthly • Returned after enrolled for 3 years – FHCW has been returning checks since 2010; after initial 3-year term, no new requirement

  12. Key Plan Features • Features include: • Coverage for work-related injuries • Preventive care coverage • Prescription drug coverage • All state mandated benefits included • Maternity • Chiropractic coverage • Mental health and alcohol/drug abuse • Seven different health plans offered; two are Health Savings Account compatible

  13. Key Plan Features • Features include: • Guarantee issue: no one is rejected for coverage • Specific medical conditions are not “ridered” • Everyone renews January 1st; no changes in premium for age bands until January 1st

  14. Current Snapshot • 1750 insured lives • Enrollment in 62 of 72 counties in Wisconsin • Manitowoc County: 41 enrollees • Brown County: 39 enrollees • Dodge County: 38 enrollees • Waupaca County: 33 enrollees • Fond du Lac County: 27 enrollees • Sheboygan County: 25 enrollees • Outagamie & Grant County: 24 enrollees • Dane County 21 enrollees

  15. Current Snapshot • Average age: 46 • Male policyholders: 71% • Female policyholders: 29% • Single policyholders: 47.9% • 2-person policyholders: 20.4% • Family policyholders: 31.70%

  16. Current Snapshot Group Size • Sole Proprietors: 88.1% • Groups 2-4 employees: 10.1% • Groups 5-9 employees: 1.4% • Groups 10-14 employees: .2% • Groups 15+ employees: .2%

  17. Current Snapshot Product Breakdown $300 deductible 11.6% $500 deductible 9.5% $1000 deductible 7.3% $2500 deductible 16.1% $2500 deductible - HSA 18.7% $5000 deductible – HSA 36.0% Essential .8%

  18. Utilization

  19. Premium Rates Average Rate Increase History* January 1, 2008 7.9% January 1, 2009 9.8% January 1, 2010** 9.5% January 1, 2011 8.0% January 1, 2012 5.35% *excludes age bracket increase **change to Anthem

  20. 2012 Member Survey • 750 members surveyed • 20% response rate • Satisfaction with: • Service • Provider network • Claim’s payment • Benefits • Dissatisfaction with: • Cost

  21. 2012 Member Survey Comments: “Overall, the health plan offered by FHCW is an improvement over the health plan I was previously enrolled in.” • “We have had other insurances that didn’t cover as much as this one does.” • “My previous plan had a lower premium, but if it wasn’t for FHCW, we wouldn’t have insurance.” • “I did not have any health insurance before.” • “FHCW costs much more but I like the accident rider for my kids and I.” • “Our premiums went up so not an improvement.” • “It’s the same.” • “This is better than old plan but still expensive.” • “Nothing can compare – cost not that different – but group rates, negotiated fees for service, more services covered – I believe this plan saved our farm.”

  22. Marketing • FHCW relies on the following marketing activities: • Year round radio commercial • Mailers • Print advertising • Word of mouth • Tradeshows • Cooperative mailings/endorsements

  23. FHCW Future • 2014 Health care reform • Only way to obtain premium subsidy is to purchase insurance is on the exchange • FHCW cannot be on the state exchange • Cooperative Network and Agri-Services Agency working together to find solutions

  24. Questions? www.farmershealthcooperative.com Cathy Mahaffey Executive Director 608-848-7212 executivedirector@farmershealthcooperative.com

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