Health Insurance as a New Indicator of Farm Households’
Well-Being
Mary
Ahearn
As with all households, the basic indicators
of farm household well-being—income and wealth—do
not fully capture information about well-being.
Because medical care is relatively expensive and
can significantly affect morbidity and mortality,
the incidence of health insurance coverage among
populations is an important indicator of well-being.
Since farming is a relatively dangerous occupation,
health insurance coverage is critical. Health insurance
provides individuals or groups with a contractual
arrangement for personal medical expenses to be
covered (usually, in part) in exchange for a fee
paid to insurance companies.
Most Americans receive health
insurance coverage through employer-sponsored programs.
Farmers are generally self-employed, raising the
possibility that farm households might be less likely
to have health insurance. However, USDA’s
2006 Agricultural Resource Management Survey (ARMS)
data clearly show that individuals in farm operator
households are, in fact, somewhat more likely to
have health insurance coverage than the general
U.S. population. The Bureau of the Census reports
that 84.2 percent of the U.S. population had some
form of health insurance for any part of 2006, compared
with 86.2 percent of the members of farm operator
households.
Although farmers are largely self-employed,
the operator and/or spouse also are employed off
the farm in two-thirds of farm households. As with
the general population, the most common source of
health insurance for members of farm households
is employment-based. In fact, farm household members
are almost as likely as the general U.S. population
to receive health insurance through an outside employer.
Farm households without the operator
or spouse working at a nonfarm job are the least
likely to have health insurance. However, these
farm operator households are more likely to be elderly
and, consequently, are often eligible to receive
health insurance from a government program—virtually
all U.S. citizens age 65 or older have some coverage
through Medicare. Some households in which neither
the operator nor the spouse works off the farm have
employment-based health insurance coverage from
previous nonfarm employers or as employees of their
own farm businesses.
Farm households with large operations
(with sales of $250,000 or more), because they are
more fully employed on the farm, are less likely
to have an operator or spouse working off the farm
than other farm households. Large-farm households
are more likely to purchase health insurance directly
from an insurance provider.
The indicators of health insurance
coverage provide more evidence of the strong links
between farm household well-being and the nonfarm
economy. The average farm household receives
85 percent of its income from off-farm sources,
and off-farm work has become the major source of
health insurance coverage. These new indicators
show that the farm population generally has found
the means to acquire health insurance.
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