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The meaning behind means testing for crop insurance

Corn grows in a field near West Union, Iowa.

Right now, if you’re a farmer and you buy crop insurance, the government pays about 60 percent of your premium no matter how much money you make. The Senate bill says, if you have adjusted gross income over $750,000, the government will chop your crop insurance subsidy by 15 percent.

“It starts to apply the same sorts of limits to crop insurance subsidies that we have traditionally applied to other farm subsidies," says Scott Faber, a lobbyist with the Environmental Working Group.    

Harwood Schaffer, a farm policy researcher at the University of Tennessee, worries the means testing could lead some farmers to go without insurance. 

“So yeah, there are people that are big enough and have enough assets to carry them through," he says.  "And at some level they will go bare.”

Or Schaffer says they could decide not to shake off their insurance coverage. And reorganize their farms so they fall below the $750,000 income limit. There is nothing in the Senate bill to prevent that -- and by the way, there is no means testing at all in the farm bill being considered by the House. 

About the author

Nancy Marshall-Genzer is a senior reporter for Marketplace based in Washington, D.C. covering daily news.

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