Posts Tagged ‘Safety Net’
May 21st, 2013 at 6:54 pm
Another ObamaCare Gap in Coverage Exposes Tangled Safety Net

How big is a “gap” in coverage when it affects 840,000 people?

The Los Angeles Times says that California is racing to pass a “bridge” program into law that helps individuals and families likely to be caught between qualifying for Medi-Cal (the state’s version of Medicaid), and ObamaCare’s new state-based health insurance exchange.

In California, residents earning up to 138% of the federal poverty level, or about $15,000 a year, will be eligible for Medi-Cal next year. Individuals earning up to 400% of the federal poverty level, or about $46,000, will be eligible for subsidies through the exchange, known as Covered California.

The Covered California board approved a plan in March to help patients expected to jump between the two. The “bridge plan” would enable patients now on Medi-Cal managed care whose incomes rise to continue to stay with their health plan once they move to the exchange.

The program, which still needs federal approval and state legislation to take effect, could serve as many as 840,000 people next year. The plan should streamline the process, keep out-of-pocket premiums low and make it easier for people to keep their providers, said David Panush, external affairs director with Covered California. “It is better for their quality of care, it is better for continuity of care,” he said.

While it’s refreshing to see California taking steps to protect people from being penalized for working more, what the article doesn’t mention is how related government policies are putting the squeeze on the state’s working poor.

California’s anti-business climate – coupled with ObamaCare’s perverse incentive structure that makes it more affordable for businesses to cut hours rather than pay hefty premium increases for employee’s health insurance – are underreported tax increases on the working poor.

By diminishing the number and quality of jobs available to people at the bottom of the employment ladder, certain public policies make it exceedingly difficult for people to work their up into a better standard of living.

Because of this, one way to think of the constant tinkering and enlargement of public benefits is as a way to compensate the working poor for taking away their access to an abundance of jobs where they can get the experience and skills needed to move upward an onward.

Under the current regime, a “bridge” program between Medi-Cal and Covered California is the least state policymakers can do. Still, those entangled in the state’s safety net deserve better.

October 25th, 2012 at 6:32 pm
Income Inequality: It’s Easy to be Poor When We Don’t Count the Safety Net
Posted by Print

The American Enterprise Institute’s Kevin Hassett and Aparna Mathur have an important (and devastating) piece in today’s Wall Street Journal breaking down the misleading facets of the left’s argument that the U.S. is currently suffering through a crisis of economic inequality. Here’s a particularly eye-opening excerpt:

In the first place, studies that measure income inequality largely focus on pretax incomes while ignoring the transfer payments and spending from unemployment insurance, food stamps, Medicaid and other safety-net programs. Politicians who rest their demands for more redistribution on studies of income inequality but leave out the existing safety net are putting their thumb on the scale.

Second and more important, it is well known that people’s earnings in general rise over their working lifetime. And so, for example, a person who decides to invest more in education may experience a lengthy period of low income while studying, followed by significantly higher income later on. Snapshot measures of income inequality can be misleading.

Thomas Sowell frequently makes a point complimentary to Hassett and Mathur’s second observation above: that measuring income inequality over time tends to be deeply misleading because membership in any given income bracket is highly fluid, with people’s income often shifting dramatically over time. Thus, someone who’s in the bottom quintile of income in today’s measurements may be in the second quintile from the top in 15 years’ time. But we tend to analyze these groups as if their composition is static.

Hassett and Mathur’s first point, however, is the one that always bowls me over. If the point of a safety net is to remove people from the perils of indigence, yet the government refuses to factor those provisions into measurements of income, we end up with a perpetually imperiled underclass that only exists on paper. As Mark Twain said (supposedly quoting Disraeli), there are three kinds of lies: “Lies, damned lies, and statistics.”