interviews
Insurance Coverage Design
by Naomi Zewde
September 24, 2020
This interview with Naomi Zewde, an Assistant Professor in the Graduate School of Public Health & Health Policy at the City University of New York, and a research fellow at the Roosevelt Institute, was conducted and condensed by franknews.
Naomi | I focus on health insurance coverage and the economic and financial implications of insurance coverage design. I look at how these things affect household financial wellbeing.
franknews | We know that medical debt is rising. What is happening in the healthcare system that explains the increase?
The issue of consumer debt in general in America is almost like a slow fire.
If people don't have the resources to meet their basic needs healthcare, education, housing — these fundamental things end up being sources of debt.
In healthcare, people’s deductibles are growing at incredibly fast rates; deductibles are growing much faster than premiums, and certainly much faster than wages over the past decade. People are left exposed to a greater share of their medical expenses, and exposed to huge medical bills — typically more than what most people have in their savings. That creates a lot of stress and fear, and often the threat of that financial burden deters people from seeking care.
What drives the prices of care up?
We don’t know.
The United States spends more on healthcare, both in dollars and in percent of GDP, than any other OECD country, but it is not clear exactly what we are spending that on.
We have a lower life expectancy. We have fewer physician visits per capita. We have a higher rate of chronic conditions. Those who provide healthcare - physicians, nurses - are not necessarily reaping the benefits either. We know that the utilization rate of the healthcare system is not unique to the United States. So why are the prices so high? That is up for debate.
We do know a few things. One, we know that a lot of this money goes towards the vast administrative bureaucracy — something that is unique to the United States. We also know that the government in other countries set prices: they either operate as the sole purchaser and thus dictate prices or they dictate prices through legislation. In the United States, Medicaid has price controls, but private insurers can charge whatever they want. There is no real way for anyone to fight back. There's no designated person to say no, you're charging too much.
Based on your research, what effect does this have on households’ finances?
I have done work around housing evictions and medical debt. We found that Medicaid expansion reduces the rate of home eviction. Going into the research it was not necessarily clear what relationship the two would have, if any. It sounded plausible — people with chronic conditions, for example, end up having to choose between rent and care. But it is astounding to think about the fact that the design of our healthcare system can have these ramifications.
I also found, in a paper that came out last month, that for 25 percent of people who were uninsured before ACA, it's cheaper to file for bankruptcy than to reach a deductible of the subsidized ACA private insurance policy.
Wow.
It’s surprising right! But it makes sense and might explain why there is such low participation in ACA private insurance policies. The congressional budget office projected that 10 million more people would enroll in these plans than actually did; only 8 million people got these. They were way off. The paper investigates why.
And what did you find?
I suspected from the beginning that it was because the deductibles are so high. The median deductible for the silver tier coverage is $4,000. There is a sweet spot in terms of the subsidies that substantially lower your deductible and premium. If you make between $12,000 and $18,000 a year, subsidies will bring down the deductible to around $200. But once you make $24,000 a year as a single adult, you're facing between a deductible between $3,000 and $4,000. So in designing the policy, it was kind of like, we will give extra subsidies to lower-income households, but not in a way that reflects what it is actually it's like to live with these medical bills. It feels divorced from reality.
Our findings don’t necessarily mean the people have to declare bankruptcy. Bankruptcy sucks and hospitals also know that when you file for bankruptcy, they typically do not get anything out of it. So, they look to work with you. Neil Mahoney has a paper, Bankruptcy as Implicit Insurance, that essentially shows that hospitals tend to settle with consumers at their cost of filing for bankruptcy. Hospitals essentially say, whatever you were going to lose if you were to file for bankruptcy, just give that money to us instead.
That reminds me of what Deborah Thorne said in our interview with her: "As Americans, we often rely on credit cards to be our social safety net. And when that falls apart, we are left with bankruptcy.” What is your understanding of how we got to this place?
It's tied up with a social-political larger trend. I have been watching this show called the Black Journal from 1968 to 1977 with a bunch of progressive Black scholars.
I watched one that was right after Nixon got elected, and everyone was saying, "America is taking a turn towards facism. All of American’s white guilt money is gone.” I think that really well foretold this mass acculturation that happened under Nixon.
The United States is not unique in this march away from social egalitarianism over the last half of the 20th century, but we are living through the consequences.
How do we return protections?
There is this famous paper - It’s the Prices, Stupid. I think there needs to be some kind of direct effect on price.
You mentioned the government can do so by either acting as the sole buyer of care or passing legislation. What do you think is the best way to achieve fair prices?
Right. One way of doing so is through a single-payer system. I am actually working on a study now that is going to be published to the Roosevelt Institute that compares single-payer with a public option.
There are two things to know about single-payer that are useful in this context.
One, it would get rid of most of the bureaucracy involved in negotiating prices — the different insurance companies, the different kinds of billing, and different plans. Right now, every doctor's office has multiple people whose full-time job is to understand how to interact with every single different plan of every different insurance company. There are many people employed on the side of the insurance company as well. Under a single-payer system, that would be gone. There wouldn't be multiple different rules to understand, and that reduces the aggregate resource use that is allocated towards healthcare.
Two, a single-payer system is tax-financed. That is important in terms of equity. You get to decide what percentage of household income should be allocated towards healthcare. Basically, the way our healthcare system is designed now means that the more money you make, the smaller percentage of it you have to put towards healthcare.
It is regressive, and no one has a choice but to participate in it.
If we structure it as a tax-financed healthcare system, the way we fund most of our infrastructure, you just get to decide what percentage of household income you are going to take from each household along the income distribution.
interviews
Vishaan Chakrabarti, Part 1
by Vishaan Chakrabarti
May 10, 2018
This interview with Vishaan Chakrabarti, the founder of PAU, was conducted and condensed by frank news. This is part one of an ongoing conversation between frank and PAU.
Okay, let’s begin. Would you introduce yourself?
I’m Vishaan Chakrabarti. I’m an architect and city planner, trained in both. I founded my practice, Practice for Architecture and Urbanism, or PAU for short. I also teach at Columbia.
Then there's this third nebulous thing I do out in the clouds, which is lecture, write, or talk about issues I think are pressing to our field, that don't necessarily neatly fit into either practice or teaching. I wrote a book a few years ago called Country of Cities, I’m thinking about a second book right now. That’s always a third line of activity beyond practice and teaching.
What does planning as a profession look like?
It’s evolved. City planning dates back to ancient China and ancient Greece. It goes back millennia. It’s always had poetic and pragmatic aspects to it. A lot of Roman cities had different ways in which they felt humanity related to the cosmos, and would lay out cities according to that. Similarly with China, in which cities laid out in Cardinal directions, were related to the way in which people interpreted their relationship to deities. City planning has a very, very long tradition.
If you go to a city like Rome, you'll see layers and layers of planning that happened under Pope Sixtus VI, and in more modern times, axis that have been cut through the cities, and that ended up influencing post-enlightenment city planning. Haussmann and ultimately Robert Moses. There is a lineage. And all of that lineage was largely top-down. City planning was always thought to be a somewhat authoritarian enterprise until Jane Jacobs came along. She was really the person who revolutionized this idea of cities being planned by the communities that live in them, and not having top-down structures that would tell them where highways would go.
There are both good sides and bad sides to that story. Unfortunately, too often in city planning education, and even among lay people, there is this sense that the story is all good. The reason that it is not all good is that it has put us in a certain kind of paralysis, particularly in the United States.
Jacobs also never answered questions about how there are a lot of communities that don’t want people of color living in them. Are you supposed to listen to the community in that instance? Where that really plays out is the affordable housing battle, and through federal housing guidelines. Communities are supposed to take their share of affordable housing, and most cities actually fight that.
Look at what's happening in California today. Jerry Brown tried to pass this thing that said, if a certain neighborhood is within proximity to a mass transit line, we need to build density there, and we need to build a certain amount of affordable housing there. And it got defeated largely by a progressive state legislature because of this idea that communities would lose control.
To me, it's not necessary to come down on one side of that argument or the other,
Where that really comes to the tip of the spear is climate change. Climate change is completely changing the way we think about, not just city planning, but landscape planning, regional planning, how we are stewards of the planet. A lot of that stewardship requires an adult way of discussing what is rational, in terms of using that land, and often flies in the face of direct community control.
For instance, building density around transit stops, that's an easy one. When Katrina happened, people said, why should we rebuild the Lower Ninth Ward? It’s an area in harm's way. Yet no one seems to ask that question about suburban subdivisions in California that are in harm's way of wildfires or landslides. Or Fire Island. I've seen entire houses washed away in the Hamptons. If you go to a lot of those California hillside communities, in the wealthy parts of Berkeley, or Oakland, what it costs to provide water or fire up there, are not rational land use patterns.
How does one balance this idea? That it should not be all top-down authoritarian, yet we're not going to get at a lot of the problems associated with climate change unless we have a more rational way of using land. That is particularly true in a world that's urbanizing very rapidly.
You have some 200,000 people a day moving to cities, mainly in the Global South. If all of those folks choose to live the way a few hundred million rich people choose to live in the West, the world is screwed. The numbers are really quite clear on this. So, I think this is part of why I do what I do.
I think a lot of people in the affiliated fields, like architecture, planning, landscape architecture, environmentalism, are driven to go to work every day by this set of concerns. Again, going back to the ancients, how humans design habitation has an enormous impact on the planet, and on every ecosystem. We are at this inflection point, and it’s interesting that Jacobs didn’t really have a good answer to this.
It’s interesting because Jane Jacobs was a contemporary of Rachel Carson. You wish the two of them had gotten together. You can’t protect nature without a sustainable way for 7 billion people to occupy the planet. That 7 billion is going to be 10 billion by 2100. Those two things have to sit in balance. We have to find a way to balance the natural world and the physical world. That is at the heart of what good city planning is about.
Do you think there’s been enough progress since Jacobs’ book came out?
I think things have progressed. Certainly because technology has allowed a lot more communication within the community, and communities are much more interconnected than they used to be, and can organize around ideas in very important ways. People don't really believe it, but Friends of The Highline really did start as a grassroots organization. The notion that people can get together, volunteer their time, be concerned about their physical environment, and get things done, is very valid.
The larger issues since Jacobs wrote, is not so much at the community level, where I think people have been doing what communities do, which is organize around things that they’re passionate about.
They don't know what they’re about anymore. That's changing slowly, but it was a field that really went into doldrums in the 70’s and 80’s because all the stuff that Jacobs fought against. Robert Moses, urban renewal, all of that was seen as politically incorrect. People couldn't be city planners as you would traditionally think of them, physical planners: blocks are here or there, highways, transit systems.
When I went to school, I studied planning before I studied architecture, and I was interested in physical planning, and that is part of why I went into architecture because I had to keep pushing the idea of understanding the physical environment, it was really not PC. I went to MIT for City Planning, and I can’t remember how many people were in our class, but I would say maybe 15-20% were studying physical planning because it was considered verboten.
Is the profession coming out of that now?
Yes and no. Our firm just won a big master planning project for the city of New York,
You have to approach some of these questions a differently in terms of how you professionally get city planning done.
Do you think academia is still stuck? Do people think it is not PC to be a planner?
Again, it is changing. For example at Columbia, there is a built environment portion in the program now. I think things are changing.
What I mean by that is, in architecture and landscape architecture, it is still very common that you’re given a site and asked, what would you do? You are asked to speculate. But planning students are taught to ask, what does the community think, what does the data show you? Those are all incredibly valid questions, in fact that has permeated architecture and landscape architecture as well.
Think about bike lanes in New York City. When the bike lanes and Citi Bike were first introduced, people thought Janette Sadik-Khan was crazy. I don’t know what the numbers are right now, but the modal share is pretty high.
Look at places like Brooklyn Navy Yard. It has 7,000 jobs and it's 25 minutes away from the nearest subway station. I think Citi Bike has created a whole new modality of how people move around a place like New York City. That to me is speculation, it’s saying, what if...
I’m not interested in autonomous vehicles for the technology as much as thinking, how can we design the streets differently? If AV’s did learn how not to hit people, could you design a street completely different? In terms of the curbs, parking, how the curb cuts for wheelchairs. Think about New York City two days after a snowstorm, it’s just a nasty mess. That has a lot to do with the way our streets are designed. Keeping pedestrians safe from vehicles operated by people. Those forms of speculation are incredibly important because we have to design better cities, because we have to attract people to live in denser circumstances around mass transit, because we clearly have the data that shows those people have a much lower carbon footprint than their suburban counterparts. We have to create a much higher quality of life in our cities than we have today. That's going to require a lot of intervention.
There's a lot of data telling us that Uber and Lyft are actually increasing the amount of traffic we're seeing in our cities. I’m a huge mass transit advocate. People ask, why do you need mass transit if you have Uber? Do you know what Uber is doing? Both in terms of traffic, and in terms of air pollution?
We have to continue investment in mass transit. It's just fundamentally inefficient to use a 12- foot lane for vehicles with one or two people in them. When we can carry hundreds of people in that same lane.
We have to be careful with technology. Technologists are interesting. They think because they've invented something super cool that it’s a panacea. And oftentimes it can make things a hundred times worse. We redesigned the world around the internal combustion engine in the 20th century, largely to very poor effect. Our cities were much more interesting, wonderful places to be, pre-internal-combustion-engine world. There's a reason gobs of tourists go to Rome every year and not to Houston.