Major medical expenses spark financial worry among farm families

National Farm Medicine Center
An analysis of more than 900 surveys of farm households from 10 U.S. states found “a top worry for farm families is the impact a major illness or injury that leads to medical debt would have on the farm enterprise

Agricultural systems face challenges from weather and markets that can threaten their resilience to shocks and stresses. Researchers in the agriculture sector tend to focus on these big crises, like storms or drops in commodity prices. Yet the “little things” that can impact any farm at any time, such as a barn fire, are seldom studied even though they may also shock and stress farm families.

Then, too, there are personal crises, such as illness, divorce or a loss of an off-farm job, which could affect anyone and certainly would have an effect on the resilience of the farm business.

An important example of these micro, household-level worries is medical debts due to medical expenses associated with a major illness or injury, which is examined in a recently published study in the peer reviewed Agriculture and Human Values, a leading journal on food and agriculture research.

An analysis of more than 900 surveys of farm households from 10 U.S. states found “a top worry for farm families is the impact a major illness or injury that leads to medical debt would have on the farm enterprise,” according to authors and rural sociologists Dr. Florence Becot and Dr. Shoshanah Inwood.

Becot is an associate scientist at the National Farm Medicine Center, Marshfield Clinic Research Institute, Marshfield, Wis., and Inwood is an associate professor in the School of Environmental and Natural Resources at The Ohio State University.

These concerns around medical debt are called “medical economic vulnerability.” While one in five (20%) surveyed farm households had a medical debt of at least $1,000 in 2016, more than half (55%) were not confident that they could pay the cost of a major illness or injury such as a heart attack, cancer or loss of limb without going into debt.

This level of debt and respondent worries about having to take on more medical debt was observed even though more than 90 percent of farmers in this study had health insurance. Another important finding is connected to quality of health insurance. In addition to having health insurance coverage, what seems to matter as much is the level of deductibles and out-of-pocket expenses that people have to pay. These “underlying challenges or worries that people have are connected to the problem of underinsurance,” Becot said, which is particularly problematic considering that agriculture is hard on the body and dangerous.

Florence Becot

“We’ve had farmers tell us they wait until 65 and are on Medicare to go take care of long-standing problems,” she said, which may affect their quality of life as well. We often hear that farmers are a “tough crowd” who don’t want to go the doctor, Becot said, when really, health care is expensive and inaccessible for many people.

The Affordable Care Act, or ACA, helped make medical coverage available to more Americans and benefitted farmers. A provision of the ACA uses income and not assets to determine Medicaid and Marketplace subsidy eligibility, which decouples the family from the assets of the enterprise and addresses the “land rich, cash poor” conundrum farmers often face. This provision allowed farm families a wider array of health insurance choices via public health insurance and marketplace options.

However, choices in the insurance marketplace can be limited, and health insurance plans are often confusing. So-called “skinny” plans – those with lower premiums but very high deductibles and out-of-pocket expenses – offer a weak safety net as people might avoid going to the doctor to limit costs, and a major illness or injury can result in medical debt.

Many farmers rely on off-farm employment for income but also as their source of health insurance, Inwood said. However, choices are limited by what the employer provides and may not be the best fit for a farm family. In rural areas it also can be hard to find jobs with good benefits.

The problem of medical economic vulnerability in the agricultural sector isn’t a new problem – but this study indicates like all Americans, farmers need affordable quality health insurance plans that ensure farm families are able to cover medical costs whether preventive or for major illnesses or injuries.

Policies to support the agricultural sector tend to focus on the farm business, yet this study points to the importance of ensuring that farm families facing personal medical crises wouldn’t be left with long-term medical debt. “The reality, too, is if health insurance was to be addressed, it would not only help farmers, it would help everybody,” Becot said.

“There has been a lot of discussions recently about the importance of agricultural programs and policies to support the resilience of farm families, yet this research indicates that one important way to bolster farm families and support their resilience is by ensuring access to affordable health insurance,” Inwood said.