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
Keller Easterling On Free Zones, Urban Porn, and the Politics of Planning
by Keller Easterling
May 8, 2018
This interview with Keller Easterling, an architect, urbanist, writer, and teacher at Yale University, was conducted and condensed by frank news.
Tell me a little bit about yourself, your background, how you found yourself in the world of planning and urbanism.
I went to school as an architect, but was mostly doing theater, and was playing both of those at the same time. I didn't know which one was going to win out. And still, my whole life, have been doing both in parallel. Now as a writer. To make my living I ended up being an architect, then ended up going into academia as an architect.
While I know how to build buildings, and I teach design, what I was most interested in was looking at the way in which space was part of global politics. What it allowed me to do was actually write a kind of footnoted fiction, so that I could carry on with this kind of writing. That would also let me describe the hyperbolic ways in which space was becoming a political pawn in global politics to a broader audience. But to my own profession, showing just how consequential space is, but not the space that we really work on in my discipline.
Can you give an example of space being used as a political pawn?
I've been studying spatial products, which are sort of repeatable formulas for space. We all know what they are: resorts, golf courses, airports, ports, parking lots, malls, franchises, all of that. I'd been studying those, and I shouldn't have been surprised, but I was, to discover that the more they were rationalized to deliver on the bottom line, the more strangely they became a vehicle for irrational fictions. And that these things which had been designed to be instruments to optimize bottom line, were also really useful as kind of fictions and pawns on the political stage. So, nations using a spatial product to tell a story. I mean, the one that I use as a kind of mascot of this idea was, The Isle of Cruise from South Korea to North Korea in the late 90s. Here was a spatial product that one wouldn’t expect to find in the situation, being used to bargain. It was part of a much broader set of urban developments proposed for the entire Eastern seaboard of North Korea.
That's incredible. Where has your work been most focused recently?
Recently, the book called Enduring Innocence, had several different kinds of stories about these kinds of spatial products landing in political situations. The next book I wrote called Extrastatecraft: The Power of Infrastructure Space, is, I suppose, about infrastructures more broadly. Much larger sociotechnical organizations. Free Zones, which are kind of like, if you can take a space, or resort, and make it repeatable. Free Zones make whole world cities into repeatable formulas. So I was working on a slightly bigger scale, but somehow that book was interspersed with contemplations about how do you design and manipulate this space?
My most recent book called Medium Design, is going even further into that contemplation. How does looking at these gigantic cloud formations prompt different habit of mind about problem solving? And aesthetics and politics as well.
Can you define a Free Zone?
There are many different kinds of Freeports, and small states, and territories, and enclaves. I'm calling a Free Zone something that wants to call itself a Free Zone. It's distantly related to the old Freeports.
It's something that really starts in the early 20th Century, as formulas started by the United States for foreign trade zones, for storing custom free trade. Which evolved or mutated into a formula that was promoted by the UN for jumpstarting the economies of developing countries. And then once China started to play with that form in the late 70s, early 80s, it became a kind of self-fulfilling prophecy. It just started propagating around the world incredibly quickly. By the 80s and 90s, there were over 66 terms for something that one would call a Free Zone.
Streamlined customs, taxes, streamlined labor, a menu of exemptions that are different in different countries. It’s a space of exemption. There are whole countries like Mauritius, in which you can legally establish a zone.
The other kind of phenomenon is that they are very hard to follow. They are like a million butterflies mutating very quickly, but they also breed with each other, so you start to get Free Zones and software technology parks as a new form, or Free Zones in science, or Free Zones in planned communities, and so on.
For someone who is new to the idea of a Free Zone, why is it important to look at them critically, especially now?
Because they have become the the world city paradigm. The most contagious formula for making world cities. Any country that's entering into the global market and is trying to attract global business, wants to give these corporations incentives and good deals. It's become impossible not to provide this kind of urbanism. Now, certain things that would have been located in cities, are located in Free Zones, to enjoy this kind of lubricated situation. By the thousands, these cities are offering Free Zones around the world.
What effect does a Free Zone within a city, have on the rest of the city?
Of course there are Free Zones which are entire cities. A megacity is Shenzhen, which is a Free Zone, within a Free Zones, and so on. One of the things that I've been noticing is a situation where there is an existing city, take some city like Nairobi, which will then become ringed by these new instant cities. Initially, those cities would get the premium infrastructure. The air conditioning would work, the Wi-Fi would work, but right outside, the infrastructure would be crumbling.
A lot of what I've been talking about is diverting a lot of that foreign investment into existing cities to develop the economy.
The workers will be working in a compound, or factory compound, and may never see the city. There are these fault lines that are also part of the picture.
Is the United States an advocate of Free Zones?
It's an interesting question in that we certainly have made deals, free trade deals like NAFTA, and so on. We are in any number of other deals as companies that might not be expressed by the U.S. government. But U.S. companies are using these Free Zones to manufacture things, to put their headquarters in, to shelter money.
So it’s purely an economic incentive?
You wouldn't be able to go back to your board and provide another rationale. It is the voice of the corporation, because how can you afford to miss out on these savings? In this so-called race to the bottom. In terms of what the United States is currently talking about, in a new nativist tone, it's hard to imagine that somehow all these other jobs would come back to the United States. Knowing what I know now, looking at thousands of these things which make up a gigantic physical plant all around the world, where jobs and manufacturing are going abroad, it's very hard to imagine suddenly coming back, just because you have the pro-American sentiment.
Are there existing protections on a global level for labor?
There are some non-binding guidelines and standards, and some watchdog lists and blacklists. Ways in which a company can be audited.
How did you come to be fascinated by this scene that operates globally, from an architecture background, living and teaching in New York and Connecticut?
I just started to follow where these formulas were going. I had initially studied special products like highways and suburban houses in the United States. When I first started looking at them, I was looking at the export of U.S. style. Only to realize how stupid that was because there were special products moving around in all directions. It was good evidence for a critique of that center periphery idea.
The way I have been doing it is largely through ephemera. It's not proper field work, where in order to do it you have to roll up your sleeves and show up there.That's not how I work. I'm often looking at how these organizations promote themselves. Their ephemera, their promotional material.
You mentioned before the promotional videos that you have collected a bunch of.
In part because everyone who wants to enter the global market is taking the same bargain. That they need to attract business in this confidence game of urban form. And urban form has become the hyperbolic attractor of that business. So these promotional videos are really wild cartoons. Emotional. They always start out the same exact way. That's why they're fun to collect. This drop through clouds to find a new center of the Earth, and there's stirring music that you'd hear in a thriller or a western or something. It's always the same. Then there's this swoop through these cartoon skylines and human figures walking around on Boulevard's and pleasure boats, and so on.
Do you have any predictions about where this moves in the future?
I don't know. One of the things that makes me hopeful is that the form mutated from something like a grey, back of house space, to a megacity in 30 or 40 years. Here's this thing, which is kind of gathering cultural scripts and desires as it goes, which are so far away from the initial economic calculation. It makes me think, what's the next script? One of the biggest scripts is that the Free Zone likes to call itself a "city". "Dubai Internet City", I mean, there are hundreds of them that have city in the title. Dubai is made up almost exclusively as an aggregate of these little mini things called "cities", Dubai Internet City, Dubai Humanitarian City, it goes on and on. I keep thinking, is there a way that one could use the Free Zones desire to be a city, as the antidote of its reversal? Is that a way in which we could encourage investment in existing cities? Rather than the newly minted ex-urban enclaves?
Stepping back to the profession for a moment, can you discuss the separation between planners and urban designers?
I am more of an urbanist or urban designer. Where I think of a planner as someone who is much more involved in policy and real estate, and has some different training, but can be a designer. There's a kind of funny gray area where someone who would be called a planner, could also be an urban design, and also a policy expert. But I would consider myself more of an urban design.
Can you define that further?
A planner might be somebody who designs a master plan. Goes to the city, designs a plan for it that is to be phased and rolled out over a period of years. As an urban designer, I don't really think that way. The way we are doing urban design, is working on things at all different levels. It's more of a rewiring of all kinds of things in a city. How a street works, how much larger systems work. But it involves the skills of a designer.
An urbanist now can be working on another kind of chemistry of parts within the city.
What's the process of going from thought to practice?
What I think is important about information about these kinds of freezones, for my students, is that they might be working at a firm like KPF, which is a big corporate firm. They do everything. They do buildings, and furniture, and gigantic masterplans. They might design a skyscraper in one Free Zone, and then do the master plan for a whole other Free Zone. If you didn't study it, you wouldn't really know what the politics of the space were. You would just be focusing on the detail of designing the skyscraper. I think it's important that architects know the politics of these places that they're working in.
Right.
But for instance, that firm designed a whole Free Zone. It has, from a certain angle, the dream of the master plan, of the architect somewhere distantly in it. It’s distantly the heroic modern architect and planner in the background.
We've looked a lot at the debate over Jane Jacobs. Shifting between bottom-up planning vs. top-down planning. In your ideal world how would planning work?
I'm already pulling away from the kind of planning we see as the bureaucratic view of planning. Or planning as a solutionist approach. The urban design that I'm doing is much different than that. The Free Zone is this kind of weird accidental cartoon of the planners dream, you know? Somone like Jane Jacobs, the way that she is thinking about all of the solids that are moving around in real time in a city, is closer to the way that, now, thinking as an urban designer, and seeing the art of that, the possibilities that makes for design.
She's being looked at as someone who was really interested in information systems, and who was originally trained that way. The way that she worked in time, and as a kind of complex temporal framework, that's closer to the way I would look at it now. Which is as an information system. As a heavy information system.
There's also a back and forth between whose job it is to make plans for the future. Is it up to the planner? Or the citizenry?
I'm sort of excited about the ways in which urbanists might be thinking up protocols. Things that reverse engineer sprawl. They're another kind of document. They're not a solution. They're multiple problems working together. There can be explicit instructions for some of these protocols that have a chance to work on retreat from the coast. I'm trying to look at urban space as a much broader mixing chamber for all different kinds of information systems, and asking, is that really more information rich than some platforms that purport to be information rich, but might be filtered through a dumb binary of likes and dislikes? Is there another space of friction and mixing in this city.