Posts filed under 'News'
The Commonwealth is currently debating greater government intervention in our health care system with payment reform legislation. Maine is moving in the opposite direction.
This press release was just put out by the think tank Maine Heritage Policy Center.
Unprecedented: Rates for health insurance plans to drop as much as 60%
PORTLAND – Rates for individual health care plans in Maine will drop as much as 60% in July as a result of health reform law PL 90, the free-market health insurance reform bill passed by the legislature last year. The Maine Heritage Policy Center was a key advocate of the bill.
Information contained in Anthem’s most recent rate proposal indicates substantial positive results from the law’s passage. After years of double-digit rate increases, the overall increase in this latest filing was only 1.7%. But digging deeper, the impact on individuals opting for newly-offered products is astounding.
Young people are big winners: 19- to 24-year-olds will be able to buy a health insurance plan with a $2,000 deductible for about $200 per month—a substantial reduction compared to the current cost of $450.
A 19- to 24-year-old with a deductible of $10,000 would pay just $100 a month—less than a typical iPhone plan.
Anthem’s new plan, Healthchoice Plus, offers dramatic savings. The plan features a lower deductible ($2,000 vs $2,250) and includes mental health coverage, not offered in Anthem’s previous Healthchoice product. Despite the lower deductible and additional coverage, premiums for the new product are far lower – from 28% lower for policyholders 60 and older to 52% lower for those aged 19 to 24.
During the debate over the health reform law last year, left-wing advocacy groups and editorial writers were sharply critical of the free market proposal. In a Bangor Daily News editorial titled “Rushed insurance reform is wrong medicine”, the paper called the new law “flawed and unstudied.”
….
Read more
Find me on twitter: @josharchambault
May 16th, 2012
The State of Rhode Island is working hard, very hard, to make sure that Curt Schilling’s 38 Studios remains a going concern. It appears the state of Rhode Island is on the hook for $50m+ if 38 Studios defaults on its loan that is backstopped by a state guarantee.
And let me be clear — no one wants the company to fail. Back when the deal initially went down, I said that Curt Schilling has every right to find the most lucrative deal for his company but that the state of Rhode Island was making a mistake. What the state did was make a big, concentrated, and multi-layered bet.
Big — $75m big. Concentrated – $75m of a $125m initiative in a single company. Multi-layered — the return on investment rests on the assumptions that 38 Studios has picked the right content, put it through the right distribution channel, and picked the right revenue model. Oh, and you’ve got to spend most of your money upfront to develop the content and build the distribution platform, before any customers show up.
Now, I know nothing about online gaming. Maybe Schilling’s on to something, maybe he isn’t. Do you think the folks working for the state of Rhode Island knew what they were getting into? An investment in a company like 38 Studios should be the domain of industry experts (risking private capital) or private investor with a high tolerance for risk and an interest in the field (like Schilling) not government bureaucrats using public funds.
And as an aside, nice work by Greg Bialecki and the rest of the Massachusetts economic development team in not responding to RI’s offer with one of their own.
I sincerely hope 38 Studios makes it. But the ongoing inability of the public sector to make investment decisions in volatile and complex markets should encourage us to get it out of the business of picking winners and losers.
Crossposted at Boston Daily.
May 15th, 2012
If you blinked over the past seven days, you might have missed the rollout of two major pieces of legislation that will dramatically restructure health care delivery here in Massachusetts. While the Governor put his proposal out over a year ago, it has taken the Legislature a long time to take up the issue.
Suddenly, everyone is in a rush. The House rushed their bill out the door at an oddly-timed late Friday afternoon press conference on Friday, May 4th. They plan on debating the bill in a month or so.
The Senate is in even a bigger rush — their bill came out on Wednesday, May 9th. Amendments are due by 5 PM on Friday. And debate begins on Tuesday of next week. Hope Senators can digest all 268 pages in time.
And all this activity will result in a final piece of legislation by the end of July if legislative leaders stick to their stated calendar.
Contrast this highly compressed round of healthcare reform with the 2006 effort — Both the Senate and the Governor had released their bills by April of 2005. The House put forward their bill in October 2005. Then the conference process and negotiations resulted in a bill signing on April 12, 2006, roughly a year after two versions were public and over five months after all versions were public.
This time around there will be dramatic changes to one of our state’s most important industries, healthcare (which accounts for close to 10% of gross state product), in less than three months. And the Legislature will have other major bills dealing with the budget, crime, and economic development (just name a few) to deal with over the same period.
That’s ripe environment for unintended consequences, mischief, and leaving hard decisions to the regulatory or administrative process. Keep a close eye.
Crossposted at Boston Daily.
May 11th, 2012
Way back in 2006, Pioneer was interested in manufacturing. Our Measuring Up study on the cost of doing business in Massachusetts showed that manufacturing was still an important employer in the state and, importantly, was a source of good wages in the places it was located.
More recently, we’ve been intrigued by the possibility of a resurgence in the sector based on rising costs at some of our off-shore competitors.
Now, Brookings Institution has done a comprehensive study of manufacturing jobs across the country. In our major metropolitan areas (Boston, Springfield, Worcester) , manufacturing jobs account for 7% to 11% of total jobs. There’s been a roughly 30% decline in the number of these jobs over the last decade, but they remain ‘good jobs at good wages’ (about 30% higher than the median wage in each region).
Can we take advantage of our newly competitive global environment and build off this important base to create good jobs at good wages? Makes one wonder why we spend so much time on casinos and not on the potential to create many more, better paying jobs.
Crossposted at Boston Daily.
May 9th, 2012
I won’t bury the lede — the UMASS law school has been recommended for provisional accreditation by the ABA’s Accreditation Committee. The next step will be a consideration of that recommendation by the ABA’s Council on Legal Education. A commenter on a related post claims that the Council has always accepted the recommendation of the Committee.
After receiving provisional accreditation, the school undergoes at least three years of review to move from provisional to full accreditation. That will be an ongoing challenge for the school but from the perspective of students, provisional accreditation gets them the right to take the bar in any state they want, so provisional is good enough right now.
As a longtime critic of the law school, I put aside my reservations for now and offer a tip of the pen to UMASS for coming this far — they’ve hit at least one (and the most important) milestone they laid out in their application. I still have serious reservations about the time and effort being expended by UMASS to address an area of the state workforce where we don’t lack for skilled employees or academic opportunities, but in a discussion strictly based on achieving stated milestones, they deserve credit.
Crossposted at Boston Daily.
May 4th, 2012
Several months back, the egregious abuses at the Chelsea Housing Authority showed the weaknesses in oversight of municipal housing authorities. The fact that it got away with that abuse for so long, even after federal and state audits, should give one pause.
Now, the Medford Housing Authority is under scrutiny. This time, its not the Executive Director’s salary that’s in question. Rather, its his habit of hiring underqualified political favorites and widespread ‘irregularities’ in contracting. In addition, there are allegations of improper usage of funds by other employees.
And, once again, we have the troubling spectre of the entity which is supposed to provide oversight — the Board of Directors — unable or unwilling to do its job properly. This account from the Globe article does not fill one with confidence:
“You could never get a straight answer from him,’’ Luongo said, recalling that Covelle told the commissioners they had nothing to worry about when some members asked about the contracts that are now the subject of the audit.
Taxpayers are told that each municipality needs an individual housing authority to best serve local needs and these local authorities need millions in state funds on a yearly basis to care for their housing assets. Yet, there are multiple points of failure in the oversight process — politicized boards that don’t exercise proper fidicuary responsibility and are insulated from scrutiny being chief among them.
It’s time to do a root and branch review of how we manage public housing in this state — Are so many entities really necessary? Should they be constituted as independent authorities? Should they be governed differently? And how can we use the carrot of state funds (that are already flowing) to mandate correct management practices?
Crossposted at Boston Daily.
May 2nd, 2012
The Massachusetts Taxpayers Foundation (MTF) put out a report late last week on the cost of Massachusetts health reform. The number from the report that has gotten the most media attention has been– $91 million.
Over the five full fiscal years since the law was implemented, the incremental additional state cost per year has averaged $91 million…
This is a very strange way to interpret the cost data. Here is the breakdown from the report:
The better number to highlight would be the incremental increase each year over the 2006 baseline.
|
2006 |
2007 |
2008 |
2009 |
2010 |
2011 |
| Over 2006 baseline (millions) |
- |
$268 |
$645 |
$1,037 |
$834 |
$906 |
If you add this up and divide by 5, you come up with an average over the 2006 baseline of $738 million, and a state share of $369 million per year. That is a much different story than the $91 million being widely reported.
Context is always needed in cost discussions, so as a reminder Massachusetts was spending roughly $1 billion annually before reform. The state redirected a sizable portion of that money to individuals to allow them to purchase insurance on their own. The reform was expected to cost money, so having some increase each year is expected, but fully understanding the sources can help explain the real story of the reform. For example, I have written on the failed promise to phase out “temporary” safety net hospitals payments before.
My methodology above has its flaws just like the MTF report. It does not account for medical inflation, or for stimulus money that would lower the state share in FY2009, 10, and 11. We both assume a 50% federal match which was not the case in those years.
Pioneer’s recent book The Great Experiment: The States, the Feds, and Your Health Care, explains some issues with these numbers provided by the Governor’s Office.
First, there is no mention of the FY 2009 $1 per pack cigarette tax that was passed to help fund the Commonwealth Care program, or the one-time $50 million assessments imposed on hospitals and insurers. The cigarette tax accounts for roughly $130 million in additional revenue each year.
Second, the calculations don’t include additional expenditures related to the reform law. The ones that immediately come to mind are $25 million of start-up funds for the Connector, or the roughly $12 million a year for community outreach grants, except in FY12.
Thirdly, the current Administration has added to the confusion of cost as it has been broadcasting two different messages.
Nationally, the Governor has been saying the reform has been manageable.
However locally on Beacon Hill, his budget staff and the Legislature have made policy decisions each fiscal year that send a conflicting message. They have cut Medicaid benefits and provider reimbursements, raised taxes, moved certain legal immigrants from the subsidized Commonwealth Care program to a cheaper insurance plan and capped enrollment to save money (which prompted a lawsuit that the state just lost), and have not fully funded to meet the demand in the health safety net or the uncompensated care pool. The MTF report cites the uncompensated care shortfall this year at $130 million. Governor Patrick went as far as to suggest in March 2009 that the state should use $40 million in stimulus funds for rate increases to acute hospitals and an additional $120 in supplemental payments to Cambridge Health Alliance and Boston Medical Center. Of course, all of these actions should not be attributed to the reform, as the economic downturn certainly played a role.
Fourthly, it is somewhat misleading to compare the reform spending to the total state budget. A much better comparison would be the state share of the reform as a percent of the new and redirected spending. This was done in The Great Experiment and instead of 1% of the total state budget being your reference, you see that a more narrow and fair comparison shows that the state is paying just under 20% of the cost of new and redirected money that has paid for reform. (see table)
Finally, this entire discussion of who pays what share is a distraction, as Massachusetts taxpayers pay both state and federal taxes. Ultimately they care about total spending and less about state spending, a fact that is often lost on policymakers and the media.
April 17th, 2012
Toll hikes are a tough sell in this area, but what if tolls were optional? And what if you were getting a premium level of service in return for your money?
That’s the basic idea behind HOT (High Occupancy Toll) Lanes. These are segregated lanes that are tolled (usually at variable rates to keep traffic flowing) and run alongside ‘free’, untolled lanes.
Think the HOV lanes on I-93 except they charge an open-road toll for vehicles that aren’t carpools. The toll would vary according to the time of day in order to keep traffic flowing (e.g. the price would be high during rush hour and decline during times of lighter traffic).
Lots of other places are trying this concept out right now and it got a lot of virtues. For existing HOV lanes with underutilized capacity, the HOT concept will put that capacity into productive use. It provides more options for users, providing a premium level of service for a price. HOT lanes generate revenue through the tolls which are both optional (you can always use the free, more congested lanes) and, according to some research, more equitable than other forms of transportation finance. In its most sophisticated form, public-private partnerships have been formed to build HOT lanes alongside existing roadways, using the income from tolls to add capacity at no cost to the public sector (beyond the foregone property abutting the roadway).
Could we use extra capacity in our highway system? Sure. Is there underutilization of the HOV lanes? Yes (but perhaps not enough to warrant full conversion). Do we have money to build that capacity? No.
So let’s put HOT lanes on the table as part (not all, obviously) of a comprehensive transportation solution.
Crossposted at Boston Daily.
April 13th, 2012
Socially liberal commentators opine against some conservative’s preference to nationalize the issue of marriage when they argue so strongly for a federalist impulse in many other areas of policy including health care. On display this past month has been the exact opposite positioning by Massachusetts’ Attorney General Martha Coakley.
It is interesting to juxtapose her two recent high profile affairs in the federal court system.
First up was her amicus brief in support of the President’s Affordable Care Act (Obamacare) which argued that the federal government has the right to regulate health insurance because it is an example of interstate commerce.
Weeks later she entered a federal appeals court leading the charge to uphold her earlier victory in court to overturn the federally passed Defense of Marriage Act, arguing that it “violates the US Constitution by interfering with the Commonwealth’s sovereign authority to define and regulate the martial status of its residents.”
April 10th, 2012
Transit riders (like me) love to complain about how long certain trips take. We wish trains, trolleys, and buses could go faster. But a lesser known factor making trips longer is dwell time — how long you spend at stops and stations waiting for people to board.
New York City has instituted a “Select Bus Service” strategy on several key routes, instituting a couple of tactics to reduce trip time by reducing dwell time. (Its also worth noting that this type of bus-rapid-transit-like service is incredibly low cost to implement relative to almost any other transit expansion or enhancement).
Most importantly, this service lowers dwell time by taking fare payment off the bus. Each station on the route has fare collection stations and inspectors regularly check for compliance (and the fine is $100, not our paltry $15 for the first offense).
Take the Silver Line from Dudley Square some morning at rush hour and tell me on-board fare collection (and the ensuing dwell time) isn’t a problem. In particular, the reluctance of many MBTA bus patrons to adopt the CharlieCard exacerbates the problem, as the CharlieTicket takes a long time to be read by the AFC machines.
Next, the SBS doesn’t stop at every stop on the route. However, the MTA continues to run a local bus on the route that makes more frequent stops — this alleviates opposition to the SBS from those patrons who value proximity of service stops over speed. (Wonder if that would have saved the 28X?)
The SBS also has a dedicated lane (enforced by cameras in many places) and traffic signal prioritization. However the primary gain in speed is due to reduced dwell time, with travel speed secondary but still important.
Lastly, the MTA is introducing articulated buses with three doors. The MBTA’s articulated buses already have this feature, but remember, with the exception of the enclosed stations on the airport leg of the Silver Line, fares are only collected at the front of the bus, rendering two doors useless for boarding at most stops.
New York has had good success with SBS service, attracting new riders and delivering enhanced service. The MBTA would be well-served to start implementing this low-cost, high-return enhancement to service on key bus routes.
Cross-posted at Boston Daily
April 6th, 2012
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