What the Pandemic Taught Us About the Homeless — and What We Shouldn’t Forget

The streets of our cities have been too empty and too full.

Emptied of cars and pedestrians, the streets of the pandemic became eerie still frames of an economy on pause. And yet, as we venture back to our sidewalks and storefronts, we are reminded that our streets also are a home, an imperfect and unsustainable haven for the transient masses we call “the homeless.” Never has it been starker than in the vacuum of social distancing that they are there, the only people who remained when all others retreated to the safety of their homes.

Thus begins my latest op-ed, co-authored with Thomas Hugh Byrne from Boston University and Benjamin F. Henwood from the University of Southern California, originally published in The Hill.

To read the full op-ed, click here.

Strategic Real Estate Innovation and the Value of Community Input

Long-term success is about more than just who gets hit first or even who gets hit hardest. It’s about resilience: who has the resources to survive, to thrive, to rebuild, to adapt, and to innovate.

That’s just a little snippet of my recent interview for CommercialCafe on strategic real estate innovation, investment, and development…

Continue reading “Strategic Real Estate Innovation and the Value of Community Input”

Finally! Someone Explains What All Those Obamacare Numbers Mean!

You’re going to hear a lot about Obamacare this fall, especially from Republicans. They’ll try to convince you that it was a bad deal. They’ll throw numbers at you to make you think that the cost of health insurance is spiraling out of control. In all likelihood, those numbers will be wrong, but how will you know? There are so many numbers flying around out there that even the experts are having trouble keeping track.

That’s why it’s time for a math lesson. After reading this article, you’ll know what the numbers mean — and which ones you should trust. No candidate will be able to fool you.

Millian Medical Index

And you won’t even need a calculator.

First of all, you have to understand that we’re only talking about the individual market, where people buy insurance if they’re not covered by their employer or a government program. That means the “individual mandate” and the “government-run exchanges” only affect 7 percent of the population. For the majority of the population covered by their employer, the cost of health insurance rose less in 2014 than it had in any year since the Milliman Medical Index started keeping track. We can probably thank Obamacare’s cost control provisions for some of that achievement, but that’s a conversation for another day.

For now, let’s focus on the individual market. Before Obamacare, insurers charged low rates to healthy people and high rates to sick people, making insurance unaffordable for the people who needed it the most. Obamacare banned discrimination against sick people and mandated that all people must purchase insurance. Without that mandate, insurers would have raised rates to cover the new sick customers, and healthy people would have refused to pay the new high rates, driving rates up even higher as the population became sicker on average.

When the law was passed, the Congressional Budget Office predicted that premiums would increase 10 to 13 percent, but only because people would be receiving more generous coverage. Obamacare required every health insurance plan to meet basic minimum standards. Additionally, by making it more affordable, more people would want to buy more generous coverage. If you compared plans with the same level of coverage, the CBO predicted that premiums would actually go down.

When states started announcing the premiums for their new “exchanges,” you probably started hearing about “sticker shock.” By comparing the new premiums to old quotes from health insurance websites, Obamacare critics claimed that the law had drastically raised prices. The problem with their argument was that the quotes on the old websites were very unreliable. They rarely reflected what insurers would actually charge you, once they factored in your medical history, age, gender, etc. In fact, many Americans would be denied coverage altogether. Anyone who knew anything about health insurance knew that the website quotes were lowballing the cost.

State governments like California countered by making a more reasonable comparison. They argued that the new exchange premiums were actually lower than premiums for small group coverage, for which they had better data. Obamacare critics weren’t satisfied. Small group plans may have been more expensive than the plans on the new exchange, but that’s because they offered more generous coverage.

The Manhattan Institute, led by conservative health expert Avik Roy, tried to find a middle ground by adjusting the quotes on the health insurance websites, raising the estimates for people who were “surcharged” or denied, and finding that Obamacare increased prices by 41 percent.

The problem with Roy’s analysis was that his adjusted numbers didn’t match reality. Before Obamacare, Roy suggested that 27-year-olds — the ones who were being hit the hardest, he argued — paid between $1,596 (men) and $1,980 (women) in average annual premiums. But the Kaiser Family Foundation conducted a survey in 2010 and found that they were actually paying closer to $2,630. Across the board, Roy had underestimated the pre-Obamacare cost of health insurance, and he wasn’t including costs that consumers paid out of their own pockets.

Last month, three Wharton economists used the Current Population Survey to calculate a more accurate estimate of the average pre-Obamacare premium. They found that it was basically identical to the lowest-cost plan available on the Obamacare exchanges. Compared to more expensive plans, of course, it was cheaper, but when they factored in out-of-pocket costs, they found that the new plans were 14 to 28 percent more expensive than the old ones, only slightly higher than the CBO’s original predictions.

Monthly Subsidized Premiums on Federal Exchange

But wait. The Wharton study only counted people who purchased insurance, not people who were denied or who refused because the insurer’s quote was too expensive. We’ll never know what that quote was, but we can assume it would significantly raise our estimate of the average premium. To ignore those people — and there were millions of them — is to say that they don’t matter, even though Obamacare was designed specifically with them in mind.

The Wharton study also doesn’t include the tax credits that the federal government uses to subsidize low-to-middle income buyers on the exchanges. Last month, the government announced that 87 percent of shoppers received a subsidy on the federal exchange, bringing their average monthly premium down from $346 to only $82!

That’s a 76 percent reduction, and it more than makes up for the 14 to 28 percent premium increase, which may not be much of an increase after all if you include people who didn’t buy insurance in the past.

Bottom line: On average, Obamacare clearly lowered the cost of health insurance.

Sure, some people will pay higher rates, but you have to remember that those people only paid low rates in the past because insurers were discriminating against sick people. The new market is much fairer and more affordable for more people — a fact that you might want to point out to Republicans on the campaign trail this fall.

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Similar versions of this op-ed were published in today’s South Florida Sun-Sentinel and Huffington Post.

Reader Request: Who Will Benefit from ObamaCare?

CBO Estimates vs. Actual Obamacare Premiums

A reader asks: Under ObamaCare, what will happen to the millions of people who don’t file tax returns, are illegals, etc? Will there be more uninsured than before? Will this new law raise the cost of health insurance?

The individual mandate does not apply to undocumented immigrants, who are also ineligible for Medicaid and the subsidies available under the Affordable Care Act. To answer the question that’s really on your mind: The new law does not allocate any of your tax dollars to them.

Where it does allocate tax dollars is to American citizens and legal immigrants who cannot afford health insurance. It’s true that some of these folks don’t file federal income tax returns because they don’t earn enough income. (They still pay a lot, however, in state, local, and payroll taxes.) They will not be eligible for the subsidies offered on the new exchanges because those subsidies come in the form of tax credits. However, if they work for a company that has more than 50 employees, they will be able to receive health insurance from their employer. If not, their fate likely depends on geography. So far, about half of the states have chosen to expand Medicaid eligibility up to 133 percent of the poverty line, all of which will be covered by federal funding. If you’re poor and uninsured and you live in one of the states that refused to expand Medicaid, you’re S.O.L., as the kids say.

By the time the ACA is fully implemented a decade from now, the Congressional Budget Office projects that it will reduce the number of Americans without health insurance by 25 million, leaving 31 million uninsured. That’s not a complete solution, but it sure is a giant leap in the right direction. It will certainly save thousands of lives.

The CBO also predicted that the ACA will lower the cost of health insurance for the individual market, where the exchanges and subsidies are targeted. Critics latched onto the prediction that people will pay 10 to 12 percent more, but that’s a misleading statistic. They’ll be paying more because they’ll be receiving more. The CBO predicts that people will be able to afford better plans; hence, the higher cost. When they compared policies with the same quality, the CBO found that premiums will fall by 14 to 20 percent — and that doesn’t include the subsidies from the government that will make the plans even cheaper.

As it turned out, the CBO was wrong: Under ObamaCare, premiums are falling more than 20 percent!

The first evidence of this success came in May when California announced the premiums that insurers will be charging on the individual market exchange next year. Plans that were supposed to cost $400 to $500 per month are actually going to cost $200 to $300.

And in case you thought California was a fluke, New York just released its individual market premiums for 2014, and they’re going to be 50 percent lower than what they are now!

The New York rates are even more newsworthy because they prove that the individual mandate is essential and cannot be postponed.

In 1993, New York passed a law requiring insurers to charge everyone the same price. As I noted in my op-ed last week, without an individual mandate, this is a recipe for extremely high premiums because healthy people will choose not to buy insurance, leaving only the sick people who are willing to pay high rates because they need the insurance so badly.

That’s exactly what happened in New York. For two decades, they’ve had the highest insurance costs in the country. Currently, only 17,000 people purchase health insurance on their individual market.

But all that will change in 2014 for one reason and one reason only: ObamaCare. The individual mandate and the subsidies will bring healthy people into the market, spreading the costs of health care among less expensive patients.

It’s important to remember that we’re only talking about the individual market. If you get insurance from your employer or the government, these numbers don’t apply to you.

It’s also important to note that someone has to pay for those subsidies. This fact alone has caused some confusion, so let me add one more myth to last week’s listMyth #5: ObamaCare will force everyone to pay higher taxes.

There are a few new taxes under the ACA, like 10 percent on indoor tanning and a higher penalty on non-medical withdrawals from Healthcare Savings Accounts, but the majority of Americans will never have to pay these taxes. The only taxpayers who will definitely face a higher rate are the richest 2 percent, who earn more than $200,000.

In other words, the cost of ObamaCare is far less than its critics would have you believe.

Tho’ I’ve belted you and flayed you, By the livin’ Gawd that made you, You’re a better man than I am, Gunga Din!

by Norman Horowitz

Ed Lawson was a better man than most.

The request by the authorities who “want to see your papers please” was an expression that I often heard in World War II movies. Today the request is made at airports and entries into different countries, and it appears to be the intention of several states to require you to show your papers to whomever they designate. It seems that we’re moving away from the direction of increasing everyone’s civil rights.

My friend for almost thirty years, Ed Lawson died a few days ago. He was 65 years old.

I’m very bummed at this moment. I’m bummed because he was involved in the struggle of a black man trying to exist as an equal in our racist society. I’m sorry that he’s no longer walking among us, and I use the word “walking” for a reason.   Continue reading “Tho’ I’ve belted you and flayed you, By the livin’ Gawd that made you, You’re a better man than I am, Gunga Din!”