Des Moines Register. November 3, 2016
One Medicaid complaint Branstad hears: Insurers’.
On Monday, Branstad announced the state would pay the three companies an additional $33 million this fiscal year. This compels the federal government, which picks up the majority of the cost of Medicaid, to fork over an extra $94.5 million. The governor largely blamed the additional costs on an increase in prescription drug prices.
But that should not be the taxpayers’ problem.
In fact, bailing out insurers defies the very premise of managed care, which is to create state budget predictability in Medicaid spending going forward. Iowa pays MCOs a fixed amount of money per month to insure each beneficiary. The rates are agreed upon by both parties and based on actuarial projections reviewed by both.
Now apparently a review of new data determined the projections were wrong. The governor, who has never met a for-profit company he didn’t want to funnel public money to, grabbed the state wallet.
Unfortunately, this is likely only the beginning of such spending surprises resulting from Branstad’s pet privatization project.
Iowa seems to be following in the footsteps of Florida, which privatized Medicaid statewide in 2014. Within months, insurers there said they were losing money and asked for an extra $400 million and a 12 percent raise. In June, the Miami Herald reported the state and federal government owed an additional $433 million to these insurers due to a mistake in the way beneficiaries were classified. Meanwhile, Florida children trying to access health care and medications are encountering numerous problems, according to a recent report from Georgetown University.
Branstad has never produced reliable evidence that privatizing Medicaid improves health outcomes or saves money. Of course, such evidence is difficult to come by. Studies show privatization saves nothing or ends up costing more than state-run Medicaid, according to a 2012 report from the Robert Wood Johnson Foundation.
That’s because government does a good job containing costs, especially in Iowa. In fact, in 2015, prior to privatization, the governor’s own administration reported saving more than $300 million through recovery efforts, identifying overpayments, coding errors and fraud. The state does not seek to please stockholders and is required to be transparent.
Then the governor handed over the program to profiteering middlemen who want to collect every public penny they can.
Now they’re the recipients of an additional $33 million from Iowa taxpayers. Let’s see how much more they ask for in the future.
Gov. Terry Branstad’s unpopular privatization of Medicaid is turning out to be an even bigger train wreck than anticipated. Since he handed over administration of the government program to for-profit insurers on April 1, numerous Iowans have been denied health services, providers have closed their doors and seniors have lost in-home care.
The governor has ignored or dismissed these complaints. Yet when the managed care companies collecting hundreds of millions of public dollars for “administration” started grumbling, Branstad snapped to attention.
Less than four months after taking over Medicaid, the insurers claimed they were experiencing financial losses. They refused to provide public documentation to support the assertion. The spokesperson for one company told a Register reporter it was “not appropriate” to discuss the company’s financial report.
Lucky for the already wealthy insurers, Iowa’s governor is there to lend a helping hand.
Waterloo-Cedar Falls Courier. November 3, 2016
Biggest golden parachute winners?
If you thought the most exorbitant golden parachutes were limited to the private sector — Wall Street or the pharmaceutical giants — you’d be wrong.
A recent USA Today survey revealed the highest paid public employees also have the most lucrative buyouts if dismissed — major college football coaches.
While they don’t rank with the severance pay record — $140 million for former superagent Michael Ovitz when he was ousted as Walt Disney boss after only 14 months — or even the reported $61 million Mylan Pharmaceuticals President Heather (EpiPen) Bresch reportedly would walk away with if ousted — the figures are still impressive.
Seven coaches could exit with buyouts of more than $20 million. Six seem unnecessary based on accomplishments — five have appeared in national championship games and another in the Super Bowl. The seventh is Iowa’s Kirk Ferentz.
According to USA Today, the coaches who would be owed $20 million or more if fired for insufficient wins are Jimbo Fisher, Florida State, $33.1 million; Urban Meyer, Ohio State, $27.4 million; Jim Harbaugh, Michigan, $25.5 million; Ferentz, $25 million; Bob Stoops, Oklahoma, $24.8 million; Nick Saban, Alabama, $23.3 million; and Dabo Swinney, Clemson, $20 million.
In fact, 33 coaches have guaranteed buyouts of more than $8 million.
Even Matt Campbell, Iowa State’s new coach, has an $11.6 million golden parachute, far surpassing what it takes the ISU Foundation to get President Steven Leath airborne — ($2.9 million for a 2002 Beechcraft King Air 350 and $470,000 for a Cirrus SR22).
Ferentz was the poster boy for the USA Today story with his 10-year, $49 million contract signed in September after an unbeaten 2015 regular season, nearly upsetting Michigan State in the Big Ten championship game and losing to Stanford in the Rose Bowl. He had been 19-19 in the prior three years.
Ferentz, who is now making $4 million, promptly lost three home games. Under the terms of his contract:
If he’s fired after this season, he would be owed more than $25 million payable in monthly installments until 2026.
He is guaranteed an additional $22 million from 2021-25 if he sticks around and wins at least seven games each season through 2020, even if he’s fired after going winless in 2021.
The guarantees aren’t reduced if Iowa fires him and he takes a lucrative job elsewhere.
Of course, Ferentz, 61, wasn’t going anywhere. He signed a $35 million, 10-year contract after an 11-2 season in 2009 with a golden parachute included. In 2012, Iowa went 4-8 and $16 million was required to buy him out.
Ferentz’ new contract, as Alan Greenspan would have it, is a case of “irrational exuberance.” Or as Martin Greenberg, a Milwaukee-based sports attorney who has represented several coaches, told USA Today, “Euphoria sometimes overtakes objectivity and intelligence.”
At least 36 major college coaches are making $3 million this year with programs awash in money — from the 12-year, $7.3 billion ESPN pays to televise just the football championships to the $800 million annually for the NCAA basketball tournament as well as the various conference contracts.
Rather than share with the academic side of the house — and rumor has it public colleges are primarily taxpayer-supported educational institutions — athletic departments have engaged in an arms race involving coaches salaries, practice facilities, dormitories and stadium luxury boxes. The courts finally have forced them to pay greater attention to the athletes’ welfare: so-called “cost of attendance” for extra food, entertainment expenses and money to go home.
“College sports is big business, and it’s a very poorly run big business,” said David Ridpath, an Ohio University business professor and board member for the Drake Group, a nonprofit advocating an overhaul of commercialized college sports.
The buyouts are indicative of the insanity with Kansas qualifying as a welfare state for failed football coaches:
Settled for $3 million in 2009 with Mark Mangino amid allegations he mistreated players. He would have received $6.6 million if fired without legal cause.
Bought out Turner Gill in 2011 for $6 million after going 5-19 in two seasons.
Bought out Charlie Weis for $5.4 million in 2014 after going 6-22. (He got $16 million from his days as Notre Dame.)
Current coach David Beaty is 1-18 in two seasons. His buyout would be $1.6 million.
In what now passes as prehistoric times, legendary UCLA basketball coach John Wooden toiled when university policy prohibited coaches from having a salary exceeding the highest-paid professor. UCLA never paid him more than $35,000.
Current UCLA basketball coach Steve Alford, formerly at Iowa, had a 15-17 record last year and would have been entitled to $10.4 million if fired.
At some point university presidents must quit acting like fanboys and bring fiscal sanity back to the college sports scene. Don’t beg athletic directors (see Bruce Harreld, University of Iowa) to share the wealth, but demand it.
Mason City Globe Gazette. November 2, 2016
We repeat: Local CAFO control needed.
Some may have been surprised about our story Sunday that interest in construction or expansion of confined animal feeding operations has doubled in the past two years and may be close to tripling by the end of this year.
They shouldn’t be. Throughout the discussions on the Prestage Foods plans to build its processing plant in Mason City, CAFOs were a key area of contention. While some saw them as a natural extension of the Prestage plant, others feared they would cause pollution and other problems.
And while the Prestage plant will now be built in Wright County, the CAFO situation is still with us in ever-growing numbers.
The Department of Natural Resources regional field office in Mason City showed 95 permit applications or site approvals through Oct. 25 compared to 70 in 2015 and 43 in 2014. Of those 95 this year, 53 are applications for state permits and 42 are for site approvals for smaller operations where no state permit is needed.
The Mason City regional office covers Butler, Cerro Gordo, Floyd, Franklin, Grundy, Hamilton, Hancock, Hardin, Humboldt, Kossuth, Mitchell, Webster, Winnebago, Worth and Wright counties – a large area, but still the jump in the number of CAFOS seems alarming even given the wide geographical area.
Environmental issues seem most concerning. Cerro Gordo County supervisors took that tact when they tried to prevent construction of a 4,900-head hog confinement facility near Ventura by River Edge LLC.
Even though the proposal met requirements set down by the state’s matrix system, supervisors felt the site in question to be too close to fragile wildlife areas and houses. There also were 20 speakers protesting the CAFO at a hearing.
Supervisors took their arguments to Des Moines but lost. The confinement met the matrix — the scorecard, if you will, with 44 categories determining whether an operation can be built.
DNR Director Chuck Gipp said because the confinement met the matrix, his agency had to approve it.
We commended Cerro Gordo County supervisors for trying, and we hope it’s not the last time they or other boards of supervisors do. We believe such operations should be under local control and not a one-size-fits-all regulation, one established 14 years ago. That way, local officials who know their counties and countryside best would be able to determine the best fits for their counties.
Not every county would operate the same as its neighbors, but we see that as a benefit of local control – that local officials would ultimately be responsible for what happens in their home areas.
We hope the new Legislature will take another look at the matrix system.
In the meantime, we anticipate the continued surge in CAFO numbers. We can only hope that those building them are good neighbors – mindful of our precious resources and neighbors they will be affecting most.
Sioux City Journal. November 3, 2016
Focus of minimum-wage debate should shift to Statehouse.
Since talk about studying whether to increase the minimum wage for Woodbury County began in June, we have opposed the idea.
We are opposed to the idea of a local study not because we necessarily oppose an increase in the minimum wage (the Legislature voted to raise the minimum wage to the current $7.25 per hour in 2007), but because we believe this discussion should take place at the state level.
We do not have a position on a minimum-wage increase for Iowa today, but we are open-minded to a discussion of the issue during next year’s legislative session.
To this end, we welcome comments about the minimum wage made by Gov. Terry Branstad in answer to a question at his weekly news conference on Oct. 24.
Branstad said he wants to meet with Iowa House and Senate leaders before the next legislative session begins to discuss the minimum wage. He isn’t necessarily advocating for an increase at this point, but he’s open to a bipartisan review of the issue in response to minimum-wage action and discussion in several individual counties.
In addition to discussion in Woodbury County, boards of supervisors in Johnson, Linn, Wapello and Polk counties have voted to raise the local minimum wage above the state level.
“I would prefer that we have a uniform statewide minimum wage rather than a hodgepodge of county-by-county, city-by-city minimum wages …,” Branstad said.
Like Branstad, we see no value for the state as a whole in having a patchwork of minimum-wage levels.
Our hope is Branstad’s remarks on the issue redirect the focus of minimum-wage debate here in Woodbury County from the county courthouse in Sioux City to the Statehouse in Des Moines where it belongs.