SLC's proud Hive Pass goes on sale tomorrow and could save you thousands

We've mentioned this before, but SLC has come out with a subsidized transit pass for $30/mo (or $350/yr) that goes on sale tomorrow. They're calling it the Hive Pass and this thing will be good on buses, TRAX, Frontrunner, MAX, and the new Sugarhouse Streetcar. This is a steal of a deal compared to the regular pass that costs $198/mo.

And the real kicker: if your family is thinking about selling one of its cars, the savings could be a few thousand dollars. Every year. Sadly, the conservative Corrolla costs at least $5k/yr to own. Even if the car's paid off, maintenance, gas, repairs, and registration, and depreciation add up to a few thousand per year. Here's the breakdown:

The Hive Pass has been touted as being the only such program in the country. I'm going to look into that, but either way it's an amazing thing. Good for SLC!

Senator Shiozawa on why he doesn't want to use Medicaid money to pay for Medicaid

Are they close to taking the Medicaid expansion money?

I contacted Utah Senator Brian Shiozawa yesterday. By way of background, he’s now pushing what appears to be the senate’s main proposal related to taking the ACA Medicaid expansion money. Instead of using the federal money for expanding Medicaid, however, he instead wants to use it to buy private health insurance for poor Utahns. So I emailed this (among other things):

I do wonder, however, why you want to use the federal money to buy poor Utahns private insurance, as was reported yesterday here: http://www.ksl.com/?sid=28848434&nid=
Many studies have shown that Medicaid is more cost efficient per-person than private insurance. I've written up a response to your proposal and wondered if you'd respond and thus facilitate a public discussion of this important issue.

And while I won’t quote him, he kindly responded by saying he was in favor of using the Medicaid money to buy private insurance because

1. Yes, he wants doctors to get reimbursed more than what Medicaid provides.
2. He thinks doctors who accept Medicaid are hard to find, and thus wants to make it easier on the enrollees of his yet-to-be-named Utah private/public insurance program for the poor.
3. He says that this setup would appease his colleagues in the Senate who are worried about crowding out (although he didn’t say this was his view).

I appreciate that he responded so quickly, the fact that he wants to accept the expansion money, and the fact that he provides reasons for his thinking. I’ll take each of his three reasons in turn.

1. Should we feel bad for doctors who have to accept Medicaid’s low reimbursement rate? There’s obviously not a right or wrong answer to this. But considering the fact that (a) health care costs are insanely expensive in the US and (b) even pediatricians (who are among the lowest earning physicians) make around $150,000/yr, forcing doctors to accept a lower reimbursement rate than private insurance would provide just doesn't seem wrong. Nations with universal health care world-wide basically set the price of their health services to keep costs down, and they’d be stupid not to do it considering the leverage their size provides. Same with Medicaid: If we don’t use the leverage provided by Medicaid’s size (and instead go the private insurance route), we’ll use tax dollars less efficiently and provide health coverage for fewer poor people.

2. It’s true that not every doctor accepts Medicaid, just like any particular employer-based insurance plan doesn't allow you to go see just any doctor. However, this study found that 84% of Utah physicians accept Medicaid, whereas the rate is about 66% nationwide, which I’m sure is better than what I’d find with the good insurance provided by my employer. Overall, however, we’ll have people in Utah on Medicaid whether we expand or not. If we're concerned about acceptance rates, we can either make it more difficult for those currently with Medicaid to find a doctor by marginalizing Medicaid or make it easier on Medicaid recipients to find a doctor by bringing 58,000 poor Utahns into the system. While certainly some doctors will continue to refuse Medicaid, many more would start accepting it with that many new potential clients (which would make it easier on all who are enrolled in the program).

3. Many conservative politicians are worried that by expanding Medicaid we’ll induce poor people to switch to Medicaid even if they already had private insurance (this is the crowding out that you might have heard of). While yes, this does happen, overall there aren't a lot of poor people with employer-based health insurance. For example, a family of 4 at 138% of the poverty line (where the Medicaid expansion might reach), makes only $32,000/yr and often doesn't have private health insurance. This study, for example, found that only around 20% of those newly enrolled in Wisconsin’s Medicaid expansion already had private health insurance, and similar figures have been found nationwide here, here, and here. Here’s the kicker though: Sen Shiozawa’s plan wouldn't avoid this (negligible) problem, as people who previously paid for their own private health insurance could just switch to private insurance paid for by the state of Utah. The conclusion of this piece explains it well.

Overall, sticking with a pure Medicaid expansion would be the wiser choice, as it’s more cost-efficient, it's widely accepted, and the (low) crowd out isn't any worse than under Senator Shiozawa’s plan. Local officials don’t need to reinvent the wheel only to provide a more inefficient program.

I sent him this and will let you know how he responds.

Utah Legislature seeks to take ACA Medicaid expansion money and fill pockets of private insurers

While the Utah House has been opposed to taking federal dollars to expand Medicaid as part of the ACA, the Utah Senate appears to be willing to do so. KSL reported yesterday that Senator Shiozawa has presented a plan that would take the expansion money and use it to direct people to private insurance coverage as much as possible. While it’s heartening to see the Senate willing to take the federal money (since Utahns are paying those taxes either way), the plan that Shiozawa put forward would use the money much less efficiently than if Utah just expanded Medicaid.

Why? Well study after study has shown that Medicaid provided much more coverage per dollar spent than does private insurance. And this makes intuitive sense, as private insurers are for profit.

In terms of the cost differences, this paper, published in Health Affairs, found that

if an average low-income Medicaid adult were instead covered by private health insurance for a full year, total spending would climb from $5,671 per person per year to $7,126, an increase of 26 percent. The level of out-of-pocket payments would rise from $197 to $1,293, an increase of 556 percent.

So, compared to using Medicaid, Shiozawa’s plan would cost 26% more to insure the same amount of people. Now why would that be desirable in any universe?

And how does Medicaid provide more cost efficient service? From the CBPP:

First, the average cost that insurers (i.e. the public program or private insurance plan) pay per beneficiary is lower under public programs than under private insurance, probably because these programs reimburse health care providers at lower rates and have lower administrative costs. Second, the average out-of-pocket costs that individuals incur are substantially lower under public programs than private insurance because Medicaid and SCHIP limit cost-sharing for low-income beneficiaries.

Indeed, the Kaiser Family Foundation states that Medicaid administrative costs are half of those of private insurers; in addition, Medicaid doesn’t have to make a profit, and it also reimburses doctors at a lower rate than does private insurance*.

Why does the Utah legislature want to reinvent the wheel in order to use our tax dollars less efficiently?

*Perhaps this is the reason Dr Shiozawa opposes Medicaid expansion? I'll email him to check.

Postscript: And no, Medicaid costs aren't out of control, and can't be used as an excuse for not expanding the program in Utah.

No, per-person Medicaid spending isn't unsustainable; it's actually flat

Lots of confused talk about Medicaid and how accepting the federal ACA Medicaid expansion will somehow leave Utah broke down the line. Despite what you've heard, Medicaid costs aren't out of control, and in fact, have grown notably slower than those of private insurance.

This figure is from this Brookings study:

Note how spending, per beneficiary, has grown more slowly for Medicaid (the red line) than for any of the other major types of insurance. This study has more on how health care cost growth has grown more slowly for Medicaid than private insurance. Utah legislators would do well to keep this in mind when figuring out how to use the ACA Medicaid expansion money.

Lucky 13 is the best burger joint in SLC

The lovely wife and I were at Lucky 13 on Friday night. If you haven’t been, Lucky 13 has quickly become the premier hamburger joint in SLC. The food is amazing. These guys smoke their own bacon, offer veggie burgers, and even have contest burgers, if competitive eating is your thing. The fries are crispy and slightly spiced. Lucky 13 outshines the tough local competition in SLC in that they’re open at night, which puts them ahead of Guzzi’s, and they don’t charge a cover on weekends, which puts them ahead of the venerable Garage (although the latter does have live music on the weekends). Here is Lucky 13 on Yelp and Google+.

And the burger menu:

And the location is on 1300 S, just west of the ballpark:

Why am I not there right now?

Strangely specific Salt Lake City parking regulations target bowling alleys and radio stations

Considering America's love of free markets, it's a bit odd that parking space minimums exist at all. If you want to find the cause of sprawl (and why we can't walk anywhere in SLC), here is ground zero.

First, the residential requirements

For example, apparently SLC thinks builders are stupid and must regulate the fact that a group home must have 1 space per each dwelling and "1 parking space for every 2 support staff present during the busiest shift."

The fun continues on to bowling alleys:

Apparently bowling alleys must have 2 spaces per lane. This is the law in SLC. Specifics are also provided for libraries, tennis courts, and radio stations. This is how the over-allocation of space to parking lots occurs and how sprawl is written into the SLC ordinances.

*This data comes from Chapter21A.44.060 of this document.

Wasatch Front Air Quality: It Starts, and Ends, With Government

Capitol to locals: "You're the problem."

A Utah policy website has an article up called “Wasatch Front Air Quality: It Starts, and Ends, with Us,” with the ultimate implication being that each of us is responsible for local air quality problems. Indeed many in the Utah legislature feel as if the solution to our air quality issues lies not with modified laws, but with the collective, benevolent and individual actions by local citizens. They are wrong. While, yes, cars aren’t driven by robots (yet), Wasatch Front residents are only responding to incentives provided by state and local governments.

First and foremost, state officials refuse to price gasoline at rates that would make alternative fuels and non-car based transportation competitive. Local officials often throw up their hands and lament the fact that green technologies just aren't competitive as if it's a fact of life. But this is the fault of state politicians. Twenty-first century transportation solutions require money to develop and implement (ie, electric charging stations, natural gas fuel stations, etc). Gas, oil, and the combustion engine were first used in the late 1800s and the corresponding legacy infrastructure from that fact makes gas very cheap compared to the health and environmental issues its combustion causes. If politicians actually care about our winter air quality issues, they need to raise the gas tax to make non-car based options transportation options competitive.

Second, the local officials are the ones deciding on UTA’s funding. If UTA is not convenient for you, this is likely a failure of YOUR state representative in the legislature. UTA does what it can with the funds it gets. Overall, if cars are significantly more convenient for us Utahns than buses, this is the fault of the Utah state government. There’s no universal law that states that it needs to take an hour on a bus (or several buses) to travel the same distance as a 10 minute car ride. There is also no universal law that public transport passes can't be subsidized state wide (as SLC has done, to its credit) or that UTA can't be free for everyone.

In addition, there are numerous local zoning laws, which are the fault of SLC and other local cities, which discourage density and make it so that driving or buses are necessary in the first place. SLC zoning ordinances, for example, limit the height of buildings (even in the city center), which pushes construction out to the suburbs and increases vehicle use and decreases air quality. Zoning laws by SLC and other local cities also require buildings to come with a minimum amount of parking (as if the builder couldn't make that decision), which often over-allocates space to parking lots, making the building-to-lot ratio smaller than it would be via the free market.

Also, it’s the state and city governments which decree that roads are to be primarily for private vehicles use. Why should every lane be dedicated to vehicles? Many countries have bus rapid transit (BRT) programs that feature dedicated lanes for buses, which makes these systems not only good for air quality, but also fast and convenient. 

Overall, if the air is dirty, it’s because local politicians don’t understand the power of incentives.