But officials of the National Crop Insurance Services, Overland Park, Kan., the trade group for the private insurers that operate the program, criticized Professor Babcock's proposal.

"One question is how to pay for the substantial additional delivery costs involved in simply giving this program to every producer," a NCIS official said.

"Farmers consciously make a decision to manage their risks when they choose to participate financially in crop insurance, which is in great contrast to the professor's suggestion," he noted.

Other major issues with the plans are that they don't protect farmers from individual losses, nor do they work well particularly for farmers who do not grow conventional field crops, said Laurie Langstraat, an NCIS official.

The plan proposed by Professor Babcock would, like the current farm subsidy programs probably covering all producers, be 100 percent subsidized and make a payment when actual county revenue falls below a target revenue, Ms. Langstraat said.

This is similar to a new prototype program called ACRE, implemented through new farm legislation.

Professor Babcock's concern is that the cost of the current subsidized private insurance program is too high.

The NCIS official said the crop insurance program has cost taxpayers $37 billion since 2000. Of the $13 billion in support over the last two years, more than $7 billion flowed to companies.

Farmers, he said, received indemnity payments (net of premium) totaling $4.5 billion in 2008 and $1.5 billion in 2009.

A large proportion of the 2008 net payments came about because the price guarantees were so high that even the modest price drops seen in 2008 generated a number of indemnity payments, he said.

As Professor Babcock explained in his testimony, under his program, farmers would use crop insurance only to insure their individual risks beyond the risks covered by the area plan.

"Nobody should begrudge farmers" their indemnity payments because they were made as a result of an insurance contract, "but should the government really be in the business of running a program that makes payments to farmers even when farm income is at an all-time record high?" Professor Babcock asked in his testimony.

"If the price drop in 2008 had not occurred, then the crop insurance industry would have been paid an additional $2 billion in 2008 to run the program," he testified.

"It just does not make sense to see such a large portion of farm program costs flowing to a middleman," he said.

The issue is being raised as NCIS negotiates with the Risk Management Agency, a bureau at the Department of Agriculture, on a Standard Reinsurance Agreement for the companies that are members of NCIS.

The RMA has proposed major cuts in the current subsidy and the NCIS has been negotiating to narrow the differences since January. The two groups hope to come to an agreement by mid-June.