Quick Reaction To Yesterday’s Medicaid Hearing In Independence

Posted on by Patrick Ishmael

Yesterday, the (take a breath) Missouri Interim Committee on Citizens and Legislators Working Group on Medicaid Eligibility and Reform (exhale) met in Independence to discuss the state of Medicaid and what should be done to fix it. The time set aside for the hearing was similarly long — nine hours — but the meeting ended up concluding after only three hours of testimony. I have expressed my strong reservations about expanding Medicaid under the Affordable Care Act (ACA) in the past, and as you might expect, nothing that I heard at today’s hearing has changed that perspective.

It was remarkable, however, to hear the “hospitals’ case” for Medicaid expansion repeated before this state-level committee, which includes their own budget concerns related to cuts made by the Affordable Care Act. Why is this so remarkable? Because the hospitals supported the ACA, which would have substantively forced states to expand Medicaid rather than opt-into it, until the Supreme Court nixed that provision last year. In the version of the law that hospitals supported, Missouri’s government would have been an afterthought because the hospitals’ deal for the state’s tax dollars was substantively made with the federal government, not the Show-Me State. Now, hospitals are appealing to Missouri to give them the state tax dollars that . . . the federal government promised them.

There are lots of great people in the health care industry, but when hospitals, as institutions, put themselves out as public servants disconnected from the politics of their predicament, it’s important to remind folks that’s simply not the case.

School Transfers, Follow The Money

Posted on by James V. Shuls

Following the advice of the Missouri Department of Elementary and Secondary Education (DESE), the Riverview Gardens and Normandy school districts each chose one school district to which they will provide transportation for students transferring from the two failing districts. Normandy plans to send buses to the Francis Howell School District in Saint Charles County and Riverview Gardens will bus students to Mehlville, on the opposite side of Saint Louis County. Suffice it to say, the announcements have gone over like a lead balloon, especially in Riverview Gardens.

According to the St. Louis Post-Dispatch, one Riverview Gardens parent claimed, “What they’re trying to do is keep us in this district rather than let us go where we want to put our kids. I think they are trying to pull a fast one.” That parent stated what I’m sure many parents are thinking. I try not to assign motives to the actions of others but instead try to look at the facts. Doing that, it seems quite clear why these districts were chosen: they are cheaper. This means Riverview Gardens and Normandy will pay less in tuition.

In the table below, I present the total enrollment and current operating expenditures for all of the school districts in Saint Louis County, as well as Francis Howell and the St. Charles School District. The two failing districts are highlighted the same color as the district to which they chose to provide transportation. The data are from 2012 and were obtained from the DESE website.

Stl area schools ppe table.emf

It is no secret that money was among the primary considerations; Riverview Gardens Superintendent Scott Spurgeon said as much. The real question is, should the decision even have been made in this fashion? That is, should the school determine where they are going to provide transportation, or should they provide transportation to the school that most of their students would like to attend?

Unreal: Governor Nixon Vetoes Volunteer Health Services Act

Posted on by Patrick Ishmael

Awful, and done the day before a holiday weekend, when fewer people would be watching. The VHSA would have let medical professionals from other states provide their care for free to Missouri’s neediest: charity whose delivery is complicated by current state law. Americans, to say nothing of highly trained American medical professionals, should be able to provide charitable care to their fellow Americans in Missouri free of undue burdens and restrictions. It is an amazing contrast that the governor wants to expand Medicaid, which will cost the state billions of dollars to deliver care of dubious value, and yet spikes care that private individuals would render free of charge. Apparently this is a big government solutions-only administration.

The governor’s veto is an affront to the poor and those who would serve them. They deserve better.

Show-Me Institute Presents: Kansas City And Saint Louis Expense Comparisons

Posted on by Michael Rathbone

Today, the Show-Me Institute released a new Case Study,  “Kansas City and Saint Louis Expense Breakdown Compared to Six Other Cities,” authored by yours truly.

This paper examines the spending of Kansas City, Saint Louis, and six other similar cities to highlight major differences in the spending of these cities. The Case Study breaks down each city’s spending into categories such as city administration, public safety, and capital expenditures. It shows whether Kansas City and Saint Louis spend more or less than their peers. Give it a glance.

Monopsony: Why Teachers Should Support School Choice

Posted on by James V. Shuls

On April 9, former journalist-turned-middle school teacher Randy Turner published a blog titled “A Warning to Young People: Don’t Become a Teacher.” Shortly after, Turner was removed from the classroom and placed on leave. It was initially believed that he was being persecuted for his criticism of the Joplin School District and his political musings (it later come out that there were more serious accusations and he would subsequently lose his job).

Early on, I penned an op-ed. Not in defense of Turner, for I didn’t know the details of his case, but in support of school choice. How, you may ask, does Turner’s story mesh with the topic of school choice?

Like this:

The Joplin School District has the corner on teaching jobs in Joplin. In economic speak, this is called a Monopsony. Whereas a monopoly means having a single provider of goods or services, a monopsony means having a single buyer of goods or services. Buyers or employers with a monopsony control the market and are able to dictate terms to the supplier — in this case, the teacher. In most cities, public school districts have a monopsony on the teaching jobs.

You see, in a school choice system, it is not just students who have options; teachers have greater options as well.

Essentially, school choice breaks up the monopsony that districts have on teaching jobs. It gives individual educators more freedom to seek out the teaching post that best fits them and it increases the market competition for their talents.

You can read the full op-ed on our website.

Of Course: Health Law That Will Ship Jobs Overseas to Be Overseen by… An Overseas Company

Posted on by Patrick Ishmael

Reported on the Fourth of July, no less. As it turns out, the British are coming…

WASHINGTON — Racing to meet an October deadline, Obama administration officials said Thursday that they had awarded a contract worth as much as $1.2 billion to a British company to help them sift applications for health insurance and tax credits under the new health care law.

The company, Serco, has extensive experience as a government contractor with the Defense Department and intelligence agencies, and it also manages air traffic control towers in 11 states and reviews visa applications for the State Department. But it has little experience with the Department of Health and Human Services or the insurance marketplaces, known as exchanges, where individuals and small businesses are supposed to be able to shop for insurance.

A billion dollar contract to a foreign company with limited experience in the health care industry? What could go wrong?

Of course, it remains to be seen how Serco will be able to determine tax credit eligibilities since the tax credits themselves are partly dependent on… the employer mandate,.

The IRS both delayed the imposition of penalties and “suspend[ed] reporting for 2014.” As the American Enterprise Institute’s Tom Miller observes, without that information on employers’ health benefits offerings, the federal government simply cannot determine who will be eligible for credits and subsidies. Without the credits and subsidies, the “rate shock” that workers experience will be much greater and/or many more workers will qualify for the unaffordability exemption from the individual mandate. …

All of these tax credit details matter to Missouri taxpayers. According to Daniel Kessler, a senior fellow at the Hoover Institution, insurance rates for many Missourians could rise a whopping 89% in 2014 because of the Affordable Care Act. To make matters worse, the question of whether tax credits can even be issued in Missouri and many other states is already unclear. Under the text of the law, tax credits flow through state exchanges only; Missouri, as well as a majority of the country, will have federal exchanges. The Affordable Care Act not only raises costs for most, but indeed, the law may be written in such a way that even its cost-mitigating provisions won’t apply to most of the country, Missouri included. Assuming Serco could determine whether tax credits can be issued to anyone, it may end up that only a fraction of the country would qualify for the tax credits outlined in the law.

It’s pretty cynical of the government to dump news of its health law outsourcing on a holiday — and of all holidays, a patently American holiday — to ensure fewer people found out about it. And it’s a sad commentary not only on the unpopularity of the law itself, but of the kind of political leadership slowly and sneakily implementing it. What a massive mess.

Common Core: A Well Intentioned Disaster

Posted on by James V. Shuls

Dr. James Shuls on Common Core as originally reported in the Show-Me Institute’s June 2013 Newsletter:

 

Milton Friedman once said, “Concentrated power is not rendered harmless by the good intentions of those who create it.” The Common Core State Standards (CCSS) are a well-intentioned idea, but they will have a disastrous impact on individual liberty and academic freedom for students. With full-scale implementation of these de facto national standards looming, Missourians may want to heed Friedman’s warning.

The idea is simple. Set common, rigorous standards for what all students in the United States should know and then watch them excel. No harm, no foul, right? Wrong.

Supporters of these standards will have you believe that the development and our subsequent adoption was completely a state-led process. The fact is that the U.S. Department of Education heavily influenced these standards. The end result is a reduction in local control.

Supporters of Common Core will also have you believe that these are just content standards. The Common Core sets the standards for math and English language arts; other subjects are forthcoming, but simply saying these are content standards could not be further from the truth. Establishing a set of national standards will have far-reaching implications for all Missourians, even those who homeschool or send their children to private schools. The standards will influence textbook development, teaching practices, college entrance exams, teacher preparation, and much more.

Ultimately, the whole Common Core movement is built on the flawed mindset that we can mandate and orchestrate improved student achievement through centralized government. For standards-based accountability to work, it must be followed by heavy-handed government accountability.

Improved student achievement comes from having great teachers in the classroom who can meet the individual needs of their students and from having parents engaged in their child’s education. States, schools, teachers, and even students are far too unique to have one centralized approach that is suitable to all of their differences.

There is nothing wrong with having high academic standards for students, but a federal consortium of states does not have to set those standards. Neal McCluskey of the Cato Institute wrote: “Only a free market can produce the mix of high standards, accountability, and flexibility that is essential to achieving optimal educational outcomes.”

Parents and taxpayers in Missouri are right to be wary of the Common Core State Standards because they are nothing more than the camel’s nose under the tent for more federal involvement in our local schools.

James V. Shuls is the education policy analyst at the Show-Me Institute, which promotes market solutions for Missouri public policy.

Obama Administration Delays Employer Insurance Mandate Penalties Until 2015

Posted on by Patrick Ishmael

Under the Affordable Care Act, many employers are required to provide a government-approved level of health insurance to employees at an “affordable” rate, or else be fined. Those provisions are, by law, supposed to come into full force at the beginning of 2014. However, according to an announcement from Treasury officials yesterday, the executive branch will not enforce the provision until at least 2015.

The Obama administration will delay a crucial provision of its signature health-care law, giving businesses an extra year to comply with a requirement that they provide their workers with insurance.

The government will postpone enforcement of the so-called employer mandate until 2015, after the congressional elections, the administration said yesterday. Under the provision, companies with 50 or more workers face a fine of as much as $3,000 per employee if they don’t offer affordable insurance.

We already know that the Affordable Care Act incentivizes small, growing businesses to send new jobs overseas, but it also has affected whether companies hire new employees . . . and whether they fire them.

Forty-one percent of the businesses surveyed [by Gallup] have frozen hiring because of the health-care law known as Obamacare. And almost one-fifth—19 percent— answered “yes” when asked if they had “reduced the number of employees you have in your business as a specific result of the Affordable Care Act.”

The poll was taken by 603 owners whose businesses have under $20 million in annual sales.

Particularly in that light, it’s no wonder the administration delayed the provision. Economically, the law is a fiasco: diverting hiring, delaying hiring, and causing employment cutbacks. Awful. It’s no wonder businesses and unions are mad about the law. Isn’t it clear that the financial well-being of our nation demands that Obamacare be reopened and reconsidered?

Monopsony: Why Teachers Should Support School Choice

Posted on by James V. Shuls

Many credit the noted philosopher Voltaire with saying, “I do not agree with what you have to say, but I’ll defend to the death your right to say it.” As Joplin School District teacher Randy Turner finds himself facing possible termination from his position, I find myself agreeing with Voltaire. Over the years, Turner has taken many cheap shots and jabs at my employer, the Show-Me Institute. He has even referred to me as a “shill” on his blog. We obviously do not see eye-to-eye on most issues, yet I respect his right to express his views.

 

While I respect his right to express his opinions, I am not taking a stance on whether he should be fired. I am not privy to all of the charges and evidence brought against him and there very well could be reasons unrelated to his views that have landed him in this situation. Rather, I think this is the perfect opportunity to discuss why teachers should support school choice.

The Joplin School District has the corner on teaching jobs in Joplin. In economic speak, this is called a monopsony. Whereas a monopoly means having a single provider of goods or services, a monopsony means having a single buyer of goods or services. Buyers or employers with a monopsony control the market and are able to dictate terms to the supplier — in this case, the teacher. In most cities, public school districts have a monopsony on the teaching jobs.

The way we have structured our education system has created this monopsony. The state has created school districts and students are required to attend those district schools, unless they can be homeschooled or afford private school. This gives the district in each town control over almost all of the teaching jobs and hampers the prospects for teachers.

When districts have a monopsony on teaching jobs, teachers have little ability to seek out a school that aligns with their values and beliefs. Rather, they have to align with the district’s thinking on issues, such as teaching practices, achievement testing, discipline policies, standards, and possibly even political issues. In school choice systems, many different types of schools exist. This allows teachers to be choosy about where they work.

Take, for example, the website myedmatch.com. It is essentially an online dating site for teachers and schools, allowing teachers to find the school that fits them. This concept is foreign to most educators because they have not had the ability to enter a true market for their labor.

Great teachers may also benefit from school choice through increased salaries. The Joplin School District pays teachers based on experience and degrees. They have no incentive to offer good teachers more money. If schools were competing for the best teachers, however, they might receive pay increases.

Essentially, school choice breaks up the monopsony that districts have on teaching jobs. It gives individual educators more freedom to seek out the teaching post that is the best fit, and increases the market competition for their talents.

If Joplin had a robust school choice system, Turner’s dismissal would be a non-issue. When he realized his school was unhappy with him, he could have searched for employment at a school that more closely aligns with his values and rewards his skill set.

All teachers, including Randy Turner, have the right to express their opinions in the marketplace of ideas. They should also have the ability to express their beliefs in the marketplace for jobs. For this reason alone, teachers should support school choice.

James V. Shuls is the education policy analyst at the Show-Me Institute, which promotes market solutions for Missouri public policy.

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