Monthly Archives: December 2012

Health Insurance Exchanges – Coming to a state near you

With the reelection of President Obama, the talk of repealing Obamacare has quieted down and the schedule for implementation has continued to run. December 14 was the day the states had to declare whether or not they would be participating in one aspect of the new law – the health insurance exchange provisions of the Patient Protection and Affordable Care Act.  As of that date, 19 states had declared state-based exchanges, 7 were planning to partner with the federal government in operating exchanges and 25 were defaulting to the federal exchange.  Washington State was among those to declare they would operate a Washington health insurance exchange.

So, what is a health insurance exchange?  The short answer is that it is a provision in the affordable care act that helps aggregate individuals and small groups into a larger entity that more nearly resembles a large business. Large businesses purchase insurance that is based on their risk. If they have a mix of employees and are generally healthy they have access to insurance at a much lower rate than a private individual. In principle, the healthy people in a large group pay enough into a plan to cover the claims of those who fall ill. In addition, their administrative costs represent savings for insurers in a large group because the group can be administered as a whole. The new health insurance exchanges will attempt to take all of those individuals and small businesses and lump them together, in effect treating them as one large group under the exchange. People or small businesses (under 100 employees) who access these exchanges can shop for the type of plan they need and the price they can afford. Rules within the exchange will help to prevent companies from cherry picking only healthy applicants or creating rules or policies which discourage less healthy applicants from applying.  The state will also reserve the right to select the plans that qualify for inclusion in the exchange.

The law has provided several options for states. They can create their own exchanges and maintain fairly complete control over their operation. They can also elect not to participate and to allow a large federal exchange to be accessed by applicants in their state. Finally, they can work with the federal government to perform a piece of the exchange activities, such as providing information and support for the sign-up. States are still allowed to control the processes of which insurers are allowed to participate in their state.  The objective of the exchanges is to create a competitive marketplace where the risk is shared among a broader base of applicants and where administrative efficiencies can be created.

Oddly enough, once the fervor about repealing the law passed, some commentators are beginning to look at these health insurance exchanges as useful entities. It turns out that while politicians were complaining about European “socialized medicine” the Swiss have been running a pretty reasonable health care system based on an exchange concept and universal health insurance provided by private insurers.  In Switzerland, they spend less than 3 percent of their gross domestic product on health care while here in the US we spend nearly 8 percent.  United States That is beginning to look like an attractive model to some who do not like Obamacare.

Right now, these health insurance exchanges are little known and poorly understood entities, but they could become the next battleground as opponents of a single payer health care system look for alternatives to the Patient Protection and Affordable Care Act. 

Buy Local – Coming Around Again?

The “buy local” movement has been gaining steam in the US since at least 2005 but its roots go much farther back into the past and many of those roots seems to have grown in our region.  Grassroots organizations like Sustainable South Sound and Sustainable Seattle were formed in the early 1990’s and were among the nation’s first organizations promoting local sustainability.  In 2008 OlyCAP led a consortium funded by USDA and partnering with the local community to conduct a Food Security Study on the Olympic Peninsula.



buy-local-reasons.jpg  During the past few years the local food movement has grown by leaps and bounds and “buy local” has rallied along as well. There are active farmers markets in Port Angeles, Port Townsend and Sequim and a growing number of small farms developing in the area with everything from vegetables to locally raised beef.  Locally made goods are becoming increasingly popular and, in case you haven’t noticed, ABC has been encouraging the extension of a “buy local” movement to “buy American.”



This seems pretty clearly a late developing trend. Virtually up to the end of the last century we were all pretty comfortable having the vast bulk of the stuff we ate trucked in from where it came from. In many cases, that was more than halfway around the world – Argentine and Australian beef, vegetables from California or Chile and fish from Southeast Asia.
 
A century ago, before the Hood Canal Bridge, it wasn’t so easy to get everything you needed or wanted locally. Yet even then some of the economic forces that inform the local food movement, for example, were still in play. We realized this while taking a tour of some century-old copies of the Port Townsend Leader.  It’s pretty clear that some of our new ideas are just recycled old ideas in a new time. The Puget Mill Company was doing its pre-Christmas advertising and touting the quality of its goods included in its claims was the fact that “since September 1 we have bought all the beef we use from the farmers in this county, thereby giving them the cash rather than sending it away.” 



Buying local was not just a requirement of isolation it was a valued choice with real economic consequences.  Today, people suggest that three times more money remains in the regional economy when people buy local.


Early in the 20th century the Olympic Peninsula was a major producer of food not only for the Peninsula but for Seattle and the surrounding area. With the redevelopment of our farms and a resurgent interest in support for high-quality local food and a corresponding interest in other locally produced items and in buying in local shops, the Peninsula is tugging on its own bootstraps and moving forward.

 

farmersfriend.jpg 


Science or Snake Oil?

Here’s a blog entry for the guys; we aren’t sexist, it is simply that access to the information we will discuss is generally in Popular Mechanics Magazine and not in Vogue or Better Homes & Gardens. In addition, one doubts women are gullible enough to fall for this stuff.  So, guys, take a trip back to the 20th century in the days when squeezing an extra mile per gallon or two of the old gas guzzler was a major concern. The following list will take you back to the barbershop and hot rod magazines.

  • Fuel OptiMiser – a device you could buy for about 20 bucks that would magnetically rearrange your fuel molecules making your gas burn more efficiently. 
  • Intake Twister – another $20 item that “spreads out” your fuel to increase mileage and horsepower.
  • TornadoFuelSaver – a device designed to create a “tornado” effect in your fuel intake increasing your mileage and power.
  • Electronic Engine Ionizer Fuel Saver – electrochemically changing your fuel characteristics to increase gas mileage. 
  • Fuel Atomizer 2000 – atomizes twice as much fuel as your carburetor resulting in astounding increases performance. 
  • Aquatune  - atomizes fuel and water to increase performance and, finally,
  • Turbonater – now VortecCylcone  that turbo charges your fuel.

All of the advertising pitches for these devices were a wonderful read. They promised fantastic gas mileage, increased horsepower and performance enhancements that seemed astronomical. They had one thing in common; they were effective in separating the unwary from their money. Oh, and they did have another thing in common – none of them actually worked. No matter what promises and claims were made, independent tests were never able to confirm the manufacturer’s claims.

This is not to say that one day a brand-new product put together by a couple of guys in a garage in Washington could not come along and double your gas mileage. It only suggests that so long as automakers remain competitive and gas mileage remains a salable feature in automobiles, it is more likely to be the auto companies than shade tree mechanics who discover any big breakthroughs in fuel efficiency.  

That said, the next generation of power salesmen is already among us. Another fuel additive has turned up in the form of “Envirotabs” – a product that claims both better mileage and a cleaner burn.  There doesn’t seem to be much in the way of product reviews yet, but there are opportunities to get in on the ground floor … 

Air powered cars were slated for introduction here as early as 2009; we haven’t seen any driving around here in Western Washington.  Zero Pollution Motors has a license to build and market cars for sale in the U.S.  They could be here any day now – but I wouldn’t hold my breath.  The story seems to have been these same for years, just around the corner.

Water powered cars are also claimed to be on the horizon. These are also not hypothetical vehicles, since water can be broken down into hydrogen and oxygen and hydrogen is pretty combustible, you can run a vehicle on water. All you really have to do is find an efficient way to convert the water into hydrogen and oxygen.  

Simple matter of physics, right?  Or maybe we can get congress to repeal the Second Law of Thermodynamics.

Updates on Vehicle Safety

Readers of our blog may remember that back in October we talked about the advances in auto technology that were beginning to impact accident and injury rates. It seems the national Highway Traffic Safety Administration has also been looking at this. NBC news recently noted that highway deaths have hit a 62 year low and a lot of the credit for driving these numbers down has to go to advances in auto technology.

Stability protection has been getting better and better, first with power brakes and now with ABS (anti-lock braking systems) and for some vehicles electronic stability control that can help prevent rollover accidents. Protection in the cabin has also been improving.  Front airbags are now a requirement for new vehicles and, although side-impact airbags are not required they are being installed in many more new cars. Crash protection through design innovation has been getting steadily better.  Look for fewer deaths and reduced severity of injuries as these developments continue.

These physical changes to the automobile have been augmented by changes in public policy and changes in driver attitude. Safety belt laws are now universal and Washington state policymakers as well as others are going all out against driving under the influence and distracted driving with campaigns of communication and legal action. Each of these factors has contributed something to the reduction in accident and injury rates; taken together they are really driving fatality rates down.

Next on the horizon is “black box” technology; electronic data recording systems that will help analyze those accidents that do occur. This technology is actually in use today with some insurers offering to set rates through “snapshots” of individual driving habits and some automobile companies including black boxes in new cars. The black box itself is simply a short-term data recorder that continuously monitors functions like speed, braking, and whether seatbelts are in use. In cars equipped with black boxes, these data recorders can be used in crash analysis. There is a movement afoot in the federal government to require all new cars in the United States to be equipped with black boxes beginning with the 2014 model year. In addition to being better able to sort out the truth of conflicting statements in an automobile accident, it seems likely that drivers who are aware there is a continuous record of their performance being made may be a little more careful. Obviously, there are privacy concerns anytime a record of activities is being made, so we will have to wait and see if these data recorders actually do become mandated.

It may not be long before your Washington auto insurance rates feel the impact these technologies. Some insurance experts are already predicting steep drops in insurance rates as technology has an increasing impact on accident and injury rates.

There is plenty of information available for the consumer as well. The National Highway Traffic Safety Administration publishes an enormous amount of information on the safety of vehicles that can be very helpful for consumer. The NHTSA website offers a wide array of safety information from crash test data and rankings to insurance related information that reflects comparative loss statistics.  

Black Friday Goes Green

The Friday after Thanksgiving has been the official start of the Christmas shopping season for decades. It dates at least to the administration of Franklin Roosevelt who notably changed the date of Thanksgiving at the urging of retailers to give them an extra week in the shopping season. Some trace the origin back to the start of the Macy’s Thanksgiving Day Parade in 1924.

While it’s generally asserted that the day after Thanksgiving and the beginning of the Christmas season is the point at which retailers move from being “in the red” to “in the black.” This is a wonderful explanation and since the press seems to have bought into it pretty widely, is perpetuated every year. Like so many other urban legends, Black Friday doesn’t seem to stand up to close scrutiny. The term actually appears to have originated in Philadelphia where the police took to referring to the day after Thanksgiving as Black Friday because of the traffic headaches and other problems caused by thousands of shoppers crowding industry to stores. It seems we can even pinpoint how and where the term came into the public view.  In in the January, 1966 edition of the American Philatelist, Earl Apfelbaum, a dealer in rare stamps placed an ad which read:

“Black Friday” is the name which the Philadelphia Police Department has given to the Friday following Thanksgiving Day. It is not a term of endearment to them. “Black Friday” officially opens the Christmas shopping season in center city, and it usually brings massive traffic jams and over-crowded sidewalks as the downtown stores are mobbed from opening to closing.

Apfelbaum’s ad and the description of the day was actually much more congruent with the general understanding of black days throughout American history. Wall Street had a Black Friday in 1869 and the labor movement had its Black Friday in 1887. We had another Black Friday in September 1984 when currency traders took a bath on the US dollar. All in all, until retail marketing got ahold of it, Black Friday was a day to be feared, not celebrated.

That is no longer the case and in November there is always a great stir as people get ready for the sales that kickoff the Christmas shopping season. There are some residual Black Friday nightmares, of course, particularly if you are a Washington Husky and you are referring to this year’s Apple Cup. There are also other issues. If you are shopper, you may want to make sure your Washington insurance is up-to-date. There are plenty of places to get injured in the shopping crush. For the past several years, Walmart appears to have been particularly dangerous although with the advent of Cyber Monday and the change in shopping hours that has Black Friday occurring on Thursday, some of the pressure seems to have been relieved.

One thing is certain, for retailers Black Friday is a study in green – money green.  According to Fox news,” A record 226 million shoppers visited stores and websites during the four-day holiday weekend starting on Thursday, the Thanksgiving Day holiday, up from 212 million last year, according to early estimates by the National Retail Federation released on Sunday. Americans spent more, too: The average holiday shopper spent $398.62 over the weekend, up from $365.34 a year ago.” 


Whether this is really a day that pushes retail business into the black is a moot point; for sure it is one big day for US retail sales.

A HOUSE DIVIDED – Then and Now

The political headlines are all pretty much the same. The fiscal cliff is looming and congress is at a stalemate.  Lest we start to think this is a new phenomenon, consider an earlier election cycle.

December 1 is an interesting day in American political history. It is a day we can reflect on how far technology has brought us and how little our politics have changed. In our last election in November 2012, most of us started our day believing that the presidential race was a toss-up.  We were mentally gearing up for a replay of the 2000 election which has ended in a near draw that was not resolved until December 12, 2000 when the United States Supreme Court ruled that a Florida court’s order of a manual recount of votes was unconstitutional. Given the pretty contentious nature of the 2012 election, a similar sort of drama seemed to be highly possible. We were surprised when the outcome of the election was pretty well known by the early evening on election day. We have technology and changes in election procedures to thank for reporting the decision so quickly.

In the election of 1824, the accounting and reporting of votes was not even completed until December 1, 1824. That election featured four main candidates all from the Democratic-Republican party.  The party’s standard bearer was William H Crawford who had been Secretary of State under James Madison. Unfortunately, Crawford had suffered a stroke during the campaign period and when the results were reported, the leading vote getter was Andrew Jackson. Jackson had won 99 electoral votes and 131 votes were required to win the election. John Quincy Adams had won 84 electoral votes, Crawford received 41 votes and Henry Clay brought up the rear with 37 electoral college votes.

With no electoral college winner, the election was thrown into the House of Representatives for decision. The House of Representatives could only consider three candidates according to the rules laid out in the 12th amendment. While Andrew Jackson might have looked to have the inside track as the leading vote getter, he had a powerful opponent in Henry Clay who, as the fourth finisher could not be considered for the presidency. Clay threw his support to John Quincy Adams after a private meeting between the two men in January 1825 and on February 9, 1825 John Quincy Adams was elected president by the House of Representatives.

Andrew Jackson supporters cried foul and there was a widespread belief that Clay had traded his support to gain his own nomination as Secretary of State. When Adams did nominate Clay for the position, his election became known widely as “the corrupt bargain.” There does not seem to be any real evidence that there was a bargain between the two men and Clay was known to have supported Adams even before the presidential election. Nevertheless, the charge of collusion was repeated often enough to follow Adams throughout his presidency and his opponents in Congress opposed virtually everything he attempted to accomplish. Adams was voted out of office in the election of 1828 which was regarded as one of the dirtiest presidential campaigns in US history.  

One byproduct of Adam’s tenure as president and the subsequent campaign of 1828 is the creation of the modern party system in the US. Adams and the other candidates had campaigned as “Democratic Republicans” in 1824, but during Adams presidency had begun to fear the term “national Republicans” while his opponents had shortened up their handle to “Democrats.”

Nearly 200 years later and it seems nothing much changes around Washington, D.C.