Squeezing Blood From A Particularly Poor Stone

Arizona is one of 22 states facing a budget shortfall for fiscal year 2016 (surprise, most of them have Republican governors and/or legislatures) and in tried and true tradition, the Grand Canyon State’s billion-dollar budget hole is going to be plugged by tossing in those awful Poors.

Facing a $1 billion budget deficit, Arizona’s Republican-led Legislature has reduced the lifetime limit for welfare recipients to the shortest window in the nation.

Low-income families on welfare will now have their benefits cut off after just 12 months.

As a result, the Arizona Department of Economic Security will drop at least 1,600 families — including more than 2,700 children — from the state’s federally funded welfare program on July 1, 2016.

The cuts of at least $4 million reflect a prevailing mood among the lawmakers in control in Arizona that welfare, Medicaid and other public assistance programs are crutches that keep the poor from getting back on their feet and achieving their potential.

“I tell my kids all the time that the decisions we make have rewards or consequences, and if I don’t ever let them face those consequences, they can’t get back on the path to rewards,” Republican Sen. Kelli Ward, R-Lake Havasu City, said during debate on the budget. “As a society, we are encouraging people at times to make poor decisions and then we reward them.”

I wonder which red state will be the first to eliminate TANF altogether, since we’re busy freeing the Poors from their plight of dependency. Also, $4 million in saving achieved, and $996 million to go. Certainly Arizona can find some more ways to punish people for the crime of being impoverished in a red state.

Cutting off these benefits after just one year isn’t fair, said Jessica Lopez, 23, who gave birth to her son while living in a domestic violence shelter and has struggled to hold onto jobs because she has dyslexia and didn’t finish high school.

“We’re all human,” said Lopez, who got $133 per month for about a year until she qualified for a larger federal disability check. “Everybody has problems. Everybody is different. When people ask for help, we should be able to get it without having to be looked at wrong.”

There are millions of angry Real Muricans out there who openly dispute Ms. Lopez’s status as “human” and don’t believe she and her son qualify for a myriad of reasons.

Arizona’s Legislature cut the budgets of an array of programs to meet the governor’s no-tax-increase pledge. The bill that included the welfare cuts received overwhelming support earlier this spring from Republicans, with just one Democrat voting in favor.

The Legislature also passed a law seeking to force anyone getting Medicaid to have a job, and cutting off those benefits after five years. And Republican leaders are suing their own state to block a centerpiece of President Barack Obama’s health care law, which expanded Medicaid to give more poor people health insurance.

If they prevail, more than 300,000 poor Arizonans could lose their coverage.

Republican Gov. Doug Ducey’s office called all these cuts necessary to protect taxpayers and K-12 classrooms — even though the source of the money is the federal government.

And of course Republicans want to abolish the Department of Education and end that federal money going to states for schools. And 300,000 people losing health insurance certainly won’t be a long-term problem for an aging state like Arizona.

After all if those awful Poors die or move somewhere else, they’re no longer Arizona’s problem, are they?



Can the Kochs Deliver the Mail Better than Florida Man?

kochrepAs I mentioned in comments on a thread yesterday, the Florida mailman who landed a gyrocopter at the US Capitol to draw attention to the corrupting influence of money in politics lives in the same media market I do and had informed a local paper of his plans prior to taking off. His stunt is therefore receiving more attention and in-depth coverage here than elsewhere.

The mailman is disappointed that the national corporate media outlets are focusing almost exclusively on the security vulnerabilities his flight revealed rather than the two-page campaign finance document he prepared for each congresscritter. The local outlets, having access to the mailman and greater interest due to the regional angle, are covering the campaign finance aspect. Not in sufficient depth, but at least they aren’t ignoring it altogether. The mailman won’t let them. Read more



Cause and effect in Louisiana

A major hospital in Baton Rouge, Louisiana is closing its emergency room because it is hemorrhaging money:

 Baton Rouge General Medical Center-Mid City will close its emergency room within the next 60 days, a victim of continuing red ink and the Jindal administration withdrawing the financial support that kept it open….

The closest emergency rooms from Baton Rouge General’s Mid City campus is Lane Regional Medical Center, 30 minutes to the north in Zachary, and Our Lady of the Lake Regional Medical Center, 30 minutes to the south on Essen Lane. Mid-City’s ER recorded 45,000 patient visits last year…..

More and more poor and uninsured patients from the low-income neighborhoods of north Baton Rouge ended up at the Mid City hospital, which was the next-closest facility.

Mid City hospital reported losses of $1 million a month as more and more patients who could not pay arrived…. Officials projected losses would grow larger, reaching $25 million to $30 million in 2015.

Poor people can’t pay full freight nor are they likely to be covered by insurance. There just happens to be an extremely attractive offer to get lots of poor people covered by insurance. Medicaid expansion would help safety net hospitals in high poverty areas the most. Poor people covered by insurance will either be able to pay something towards their emergency room visits or divert to lower levels of appropropriate care.

Read more



Like A Kansas Tornado

Storm system Brownback continues to ravage the state of Kansas unabated, and the next casualty involves some good old fashioned school austerity bombing.

Kansas Gov. Sam Brownback’s proposed budget cuts about $127.4 million from state support to local school districts, according to a report released Tuesday by the state Department of Education.

Some Senate Republican leaders dispute that the cut is that deep, saying the Education Department figure doesn’t account for spending on bonds and interest for school construction or payments to the state retirement fund.

The governor’s plan, released Friday, is to roll four major categories of spending into block grants to school districts. The block grants will include the money now spent in general state aid, supplemental state aid, capital outlay aid and the school district finance fund.

This year’s budget for those categories is almost $3.14 billion. The block grants proposed by the governor would total slightly more than $3 billion.

Block grants for schools that are already badly underfunded to the point where the state supreme court ordered Brownback to spend more, huh.  This should go over well.  Oh, but here’s the best part.

More broadly, Kansas state workers’ pension funds are also being used to patch Brownback’s fiscal gap. He is proposing to cut state payments to pension funds by $446 million over three fiscal years including the current one while also refinancing some of the funds’ debts. But the executive director of the Kansas Public Employees Retirement System says Brownback’s proposed tweaks will ultimately cost the state more than 8 times what they save in the short term.

The near-term cuts would raise long-term costs by $3.7 billion — nearly a quarter of the current size of the pension system. Reneging on pension obligations in the short term and creating larger retirement system problems in the long term helps create political pressure to cut workers’ retirement benefits down the road, according to critics of similar maneuvers in states like New Jersey.

Another big-ticket Brownback cut strips roughly $300 million in transportation department funding over the next couple years — a move that shares the penny-wise, pound-foolish DNA of Brownback’s schools and pensions cuts. The road repair cuts will save a little bit of money now, but “all you’re going to do is create bigger problems for yourself later,” the head of a trade group for heavy construction firms in Kansas City told the Star.

And that’s on top of his plan to raise cigarette and liquor taxes so he can keep cutting the state’s income taxes, which caused all this mess in the first place.

If you want to see what a Republican budget will do to the country should they get control of the whole playing field in 2016, look no further than the tornado ripping through Kansas right now.



PPACA and the Continuing Resolution

The continuing resolution that needs to be passed sometime soon to keep the government open will deal with PPACA.  There are currently two big things not included in the resolution.  One may prompt a veto threat (I assess that at 10% probability) and the other has been baked into the cake for over a year now.

The big new thing that is not in the continuing resolution at this time is an appropriation to fund the risk corridors.  The Hill explains:

The language, buried deep in the 1,603-page bill, is a victory for conservative opponents of the healthcare law. It would prevent new government funds from flowing to ObamaCare’s so-called risk corridors, a three-year program established to subsidize insurer losses in order to keep premiums stable.

A commonly used tool in public policy, risk corridors have become a political football since Sen. Marco Rubio (R-Fla.) highlighted the ObamaCare provision as a “bailout” in November of last year. Since then, activists with Heritage Action and other groups have repeatedly sought to kill the payments in major fiscal negotiations.

The “cromnibus” spending bill would allow the government to continue collecting payments from insurers that post better-than-expected results under ObamaCare and passing them to companies that do worse. But it would not permit the Centers for Medicare and Medicaid Services to make additional funds available for insurers that are struggling.

Risk corridors are used to create incentives for insurers to participate in fuzzily defined markets.  Insurers that price in a way that attracts only healthy populations send money to insurers who have to cover the sicker parts of the population.  Medicare Part D has permanant two-way risk corridors.  PPACA had temporary three year risk corridors authorized but the money was not appropriated to pay for them past the FY2014.  The Congressional Research Service issued an opinion that the PPACA language  was too fuzzy and did not explicitly appropriate  money to go back out.

What are the work-arounds?

Read more



Shocking news — people able to pay, pay

More shocking news.  Obamacare is gutting another quintessential American industry that is a world leader without peer — medical debt collection.

Via Bloomberg:

HCA Holdings Inc. (HCA), the largest for-profit hospital chain, yesterday raised its forecast and reported a 6.6 percent drop in uninsured patients at its 165 hospitals, a reduction that grows to 48 percent in four states that expanded Medicaid, a top initiative of the Patient Protection and Affordable Care Act….

The law contributed as much as $13 million to LifePoint’s earnings in the second quarter, about 40 percent more than the company had expected, he said. People paying bills themselves, a proxy for the uninsured, represented just 4.8 percent of admissions, down from 7.1 percent a year earlier….

Shocking how making sure people have the ability to pay for medical care leads to them paying for medical care on time and close to the contracted rate.  The old system of haphazard payments stretched out over years leading to medical debt stress had to be superior because it created jobs for credit collection agencies to hound people for ridiculous fees, for hospital financial analysts to figure out how to smooth cash flow from good months to bad months, and for social workers to be busy as a medical emergency led to their clients entering a life emergency as every other thing that depended on decent health and pre-committed cash flows just got blown up.  Predictibability is a bad thing for all of these jobs.  We can’t have that as the extra couple of points of GDP spent on waste and passing the buck in healthcare means JOBS (TM) that will never be replaced by higher and better uses of people’s times.



Healthy PA or nothing until 2016

Atrios raises an interesting question concerning Healthy PA.  Healthy PA is the proposal by Gov. Corbett (R-PA) to expand Medicaid by using a combination of the Arkansas private option and the Michigan style health incentive/HSA program plus some gratuitous poor shaming.

 

I’m not sure if it’s better to just pay it and get people enrolled, or gamble on the reasonable possibility that after November a new governor will have a better plan.

I’m not a Pennsylvania political junkie, but from my understanding of Pennsylvania politics, it is extremely likely that Corbett loses this fall to any of the fairly generic/standard issue Democrats running but the Republicans are extremely likely to continue to hold one if not both chambers of the state legislature.

The biggest downside to this political gamble that the Democrats could get something better is timing.  Right now, the Corbett administration has put out a request for interest/application to Pennsylvania insurance companies.  If the goal is to have Healthy Pennsylvania running on January 1st, the health insurance companies have six months to do the prep work.  Speaking as a plumber, six months to build a brand new product with a whole lot of strange and odd business rules is an extremely aggressive timeline.  It is achievable if the Pennsylvania companies are able to keep most of their plumbers on a single task.

Now, as I understand it, the Pennsylvania governor’s term starts in mid-January.  Getting anything better than Healthy PA past at least one Republican controlled chamber will take several weeks/months.  At that point, the plumbing for expansion is several more months.  Realistically, if anything better than Healthy PA can get passed, it probably could not be implemented until at least September 2015, more likely the start date would be January, 2016.

There is a non-zero probability that a failed Healthy PA (shot down by Dems holding most of their votes away) leading to a failed straight up Medicaid expansion.

The trade-off is Healthy PA effective January 1, 2015 OR the probability of something better on either September 1, 2015 or January 1, 2016 plus the probability  of nothing.  If Healthy PA is implemented, it can be tweaked, modified and improved.  My moral sense says it is better to get a significant improvement in wellbeing for the most disadvantaged in society than to hold out for the possibility of something better but later with the chance of nothing. I’m mini-maxing here.