Thursday, February 28, 2013

Arkansas Medicaid Expansion: An experiment in anti-coordination

I've seen a lot of talk about the decision to let Arkansas expand Medicaid by having people buy private insurance policies on the Exchange.  Much of the discussion focuses on cost, in that private policies cost much more per person than does Medicaid coverage.  That's a problem if you think we spend too much on health care.  But it may not be the worst one.

The Medicaid expansion population is people with incomes below 133% of the federal poverty level.  Per a KFF Brief this population has a household income distribution as follows (2013 FPL level for a single adult in parenthesis):

Less than half of FPL ($5,745)  - 49%
Between half and 100% of FPL ($11,490) - 30%
Between 100% and 133% of FPL ($15,282) - 21%

So Arkansas is telling a population, roughly half of whom make less than $6,000 a year, to go shop for insurance policies on the exchange.  Gee, I wonder what could go wrong.
  • Are these people literate?  It's awful hard to shop for a policy when you can't read.
  • Do they have homes?  How will they manage all the paperwork that goes with private insurance when they don't have a permanent mailing address?
  •  Most important, will they understand their policies?  Understanding the basic terms and conditions, such as when emergency room use will be covered or which providers are in network or what kind of pre-authorization is required is critical to effectively using an insurance policy.  Mess that up and you are functionally uninsured. 
Using the exchanges to provide insurance for people in poverty strikes me as the worst of all worlds.  It inflates premiums in the exchange as community rating forces everyone else to pay for a sicker population, it soaks the nation with paying their full premiums since they have no money to pay it themselves, it hurts the Medicaid population as they'll put off care once they get a "shock" bill because they didn't understand their insurance, and it will soak hospitals when that population defaults to the local ER for safety net care which may or may not be reimbursed by insurance.

Oregon is investing a lot of resources into Coordinated Care, ensuring that the Medicaid population gets the most medically-effective and cost-effective care possible.  Arkansas, and states that follow them are embarking on a bold experiment in Anti-Coordination.  Instead of the hard work of aligning incentives, resources, and purpose they are closing their eyes and throwing money at the problem.  You don't need to be an actuary to guess how that will work out.

Sunday, February 24, 2013

HB 2800 (CRC): A letter to my State Representative

Representative [ ],

I'm writing to express my great disappointment with the news that you will support HB 2800, endorsing construction of the Columbia River Crossing.  That highway project will have long term adverse consequences for the district, for the city of Portland and the state of Oregon.  The project benefits you cited are of marginal value:

- Light rail to Vancouver benefits Vancouver, not us.

- As a tool for managing demand tolling is inferior to existing capacity constraints.  Do you really mean to say you support building a new bridge because it will lead to fewer vehicle trips than occur now?  We should embark on the most expensive capital project in Oregon history so that it can provide less than existing service?  Can you look at yourself in the mirror and say the CRC will be a disincentive to suburban sprawl?

- The construction industry will indeed benefit from spending 450 million dollars.  But what does that have to do with the CRC?  $450M would benefit the construction industry just as much if it were spent on seismic upgrades to our schools.  Or on building a better tsunami evacuation system.  Or on rewiring our electrical system to better integrate renewable energy.  Or any number of pressing infrastructure needs that you know better than me.  Why not spend that kind of money on something that brightens our future rather than darkens it?

The supposed conditions you cited for your support are small comfort.  You claim your support was conditional on tolling I-205, and two paragraphs later admit there will be no tolling on I-205.  What stock can we put in those conditions when they don't even last through your email?  Why should we believe you will react tomorrow to what is plainly obvious today?

Supporting HB 2800 while hiding behind conditions you won't or can't enforce is passing the buck.  It puts us in the position of waiting for someone else to do the right thing and pull the plug on this project.  That is not what I sent you to Salem to do.

Friday, February 22, 2013

Red tape spawns before our eyes...

The Oregon Land Use Board of Appeals released its decision on a much maligned housing project on Division Street.

Of the three claims made by the Richmond Neighbors for Responsible Growth, LUBA rejected two and a half.  In particular LUBA rejected the contention that the city did not consider transportation impacts associated with the lack of parking. 

The only part of RNRG's brief supported by LUBA was the contention that mixed use developments must put the entrance to residential sections on the main street, the same as if they were a commercial use.  Is that really a win for the neighborhood? 

Is Division Street better off if part of the frontage is reserved as an entrance to apartments rather than retail?  Are side streets better off if they're effectively required to be useless blank walls?  If a building includes parking does this mean the parking entrance must be on the main street too?  The code doesn't say that, but it didn't say anything about apartment entrances either.  LUBA read the requirement on residential entrances out of thin air, in spite of the fact (which they acknowledge) that the requirement wouldn't exist if it was only a residential building and not mixed use.

The LUBA ruling resolves nothing about residential parking requirements.  It merely establishes that the State has an actionable interest in whether apartments in mixed use developments put their entrance on the main drag or a side street.  What purpose that interest serves is not obvious. 

If such a claim had gone before the city or any other body that gave a damn it would have been rejected out of hand.  Instead we get a ruling that only an apparatchik could love, and the promise that every project in the city will face an additional layer of red tape.  Thanks Richmond!