Public retiree health costs loom

State and local governments face paying hundreds of billions of dollars in the coming decades for their retirees' health care, an AP article reported Sept. 24. Governments have been funding retiree health costs on a pay-as-you-go annual basis. But new rules from the Government Accounting Standards Board (GASB), an independent organization that sets accounting standards for public agencies, will require disclosure of future retiree costs. "'When the numbers are produced, they're going to be shocking,' said Ronald Snell, director of state services for the National Conference of State Legislatures (NCSL)." The GASB rules were issued in 2004 and take effect in 2008.

The new rules stem from GASB's Statement 45 (see news release) and apply to "other post employment benefits" (OPEB), healthcare being the most common OPEB. GASB prepared a Q&A (pdf, 2p.) on Statement 45 and OPEB.

In February, the Federal Reserve Bank of Chicago issued a brief paper, OPEB: The 800 Pound Gorilla in the Room, providing a more technical perspective on the subject.

In California, the Legislative Analyst's Office (LAO) published two reports this year with the same title: "Retiree Health Care: A Growing Cost for Government," on Sept. 26, 2006 (pdf, 500KB, 26p.), and Feb. 17, 2006 (pdf, 452KB, 22p.).

In Hawaii, the most recent estimate of healthcare costs was reported by the Auditor in May 1999, in "Actuarial Study and Operational Audit of the Hawaii Public Employees Health Fund," Report No. 99-20 (pdf, 1.3MB, 118p.). In that report, the State and counties' liability for future retiree health benefits, as of July 1, 1998, was estimated at $4.5 billion; for the year 2013, it was $11.4 billion.

Affordable health care for all Americans

The Medicare Prescription Drug, Improvement, and Modernization Act Of 2003 (Public Law 108-173) created the Citizens' Health Care Working Group (Sec. 1014) with a mission to, " Develop an action plan for Congress and the President to consider as they work to make health care that works for all Americans." The citizen's group announced the release of its Final Recommendations on September 25, 2006. President Bush has 45 days to comment on the recommendations and offer a report to Congress.

Also reported in a New York Times article Tuesday, the panel report's number one recommendation is that, "'It Should Be Public Policy that All Americans Have Affordable Health Care' and that all Americans have access to a set of affordable and appropriate core health care services by the year 2012." Further recommendations include:

• Guarantee Financial Protection Against Very High Health Care Costs
• Foster Innovative Integrated Community Health Networks
• Define Core Benefits and Services for All Americans
• Promote Efforts to Improve Quality of Care and Efficiency
• Fundamentally Restructure the Way End-of-Life Services Are Financed and Provided

The working group continues with three guiding principles financing new initiatives: fairness, incentives for economic efficiency, and sufficient funds.

Citizens' Health Care Working Group, Final Recommendations

Health Care That Works For All Americans (September 2006, pdf, 39pp/356kB)
Executive Summary (September 2006, pdf, 16pp/400kB)

Back from the future: the world is flat

As the Internet becomes easier in which to participate and cheaper to implement, techies, thinkers and stakeholders share certain concerns and beliefs on the global flattening. The network will be lowcost; English will continue as the global language of communication yet will not displace other languages; national boundaries will blur; the transparency v. privacy conflict will struggle to build and define the better world; and there will be some reaction to the reaches of technology resulting in planned disruption and refusal to be "on the grid."

Pew Internet published Sunday the results of their survey in the 115 page report on the future of the Internet. Not all positive, the predictions also expressed the dread of control, overregulation and abuse by those in power:

By 2020, intelligent agents and distributed control will cut direct human input so completely out of some key activities such as surveillance, security and tracking systems that technology beyond our control will generate dangers and dependencies that will not be recognized until it is impossible to reverse them. We will be on a "J-curve" of continued acceleration of change.

The Future of the Internet II (September 2006, pdf, 115 pp/524 kB)

Koa economics

Exploring economic incentives for private landowners to adopt conservation practices has become an important focus of conservation efforts, according to a report by the Center for Environmental Sciences and Policy (CESP) at Stanford University. A CESP team did a case study on developing koa forestry in Kona, Hawaii, to combine forest conservation with financial benefits. The paper was published in the Proceedings of the National Academy of Sciences (PNAS), June 27, 2006.

The team selected koa for four reasons:

• From a biodiversity perspective, a large fraction of native Hawaiian biota is associated with koa forests....
• From an ecosystem services perspective, koa forests provide carbon sequestration and hydrological and cultural benefits.
• From an economic perspective, koa is Hawaii's premier timber, and its high market value creates a potentially lucrative investment.
• Finding economically viable means of reforesting degraded pastureland is relevant far beyond Hawaii, particularly in the tropics.

The team concluded that

forestry ventures based on the high-value, native hardwood koa is a financially viable investment with strong potential to be a "win-win" land use for private landowners and for conservation.

The paper also cites the Conservation Reservation Enhancement Program (CREP), under which a landowner, by enrolling in the program, can "receive rental payments and cost-share assistance covering initial forest establishment and ongoing major maintenace costs." CREP is expected to be established in Hawaii through the Farm Service Agency (FSA) of the U.S. Dept. of Agriculture (USDA).

Business strategies for conservation on private lands: Koa forestry as a case study (pdf, 400KB, 6p.)

Whither voter photo ID?

Yesterday the U.S. House passed, 228-196, the Federal Election Integrity Act of 2006, H.R. 4844 (pdf, 64KB, 12p.), which requires any voter "in an election for Federal office" to provide photo identification. See also, accompanying committee report 109-666 (pdf, 420KB, 62p.).

This is a controversial issue. Common Cause, together with other national groups opposing this law, issued a statement on Sept. 19, "Rights leaders warn voters would lose franchise under proposed voter ID bill":

"Our election systems have many serious systemic problems, but people pretending to be someone else at the polls is not one of them," Common Cause President Chellie Pingree said. "Congress should focus on the real problems that have shaken Americans' confidence in voting, such as requiring a voter verified paper trail in case electronic voting machines malfunction, or assuring that polls have enough workers and voting machines so people don't have to wait in long lines on Election Day. We should be making voting more accessible, not putting up more hurdles."

In the past week, the New York Times has reported on photo ID laws being struck down in Missouri and Georgia.

The National Conference of State Legislatures (NCSL) provides a web page of State Requirements for Voter Identification, updated Aug. 1, 2006, listing 7 states that request photo ID: Florida, Georgia* (notes that law was enjoined by US District Court, July 2006), Hawaii, Indiana, Louisiana, Missouri, and South Dakota.

Retirement income - what's enough?

In a Sept. 13 press release (pdf), the Employee Benefit Research Institute (EBRI) announced its new study on calculating adequate retirement income. Conventional thought was that replacement of preretirement cash flow, with adjustments, was sufficient. However, EBRI finds that kind of calculation to be "overly simplistic and potentially inaccurate."

Given the huge variation of individual circumstances (such as age, health, and income) and the complexity of retirement risks that need to be dealt with -- such as longevity (addressed through annuitization of assets), old-age infirmity (addressed through long-term care insurance), and asset preservation (addressed through investment allocation) -- a single one-size-fits-all replacement rate will not work for most Americans.

The new EBRI model uses three "building blocks" to estimate retirement income needs: investment risk, longevity risk, and catastrophic health care costs. EBRI has also produced a Retirement Security Projection Model (RSPM) that incorporates additional factors such as defined benefit accruals, defined contribution, cash balance, IRAs, social security, and housing equity. "...the model points not only to a more realistc size of the retirement income problem but also ways that individuals can begin to deal with it."

According to its web site,

The EBRI mission is to contribute to, to encourage, and to enhance the development of sound employee benefit programs and public policy through objective research and education.

Measuring Retirement Income Adequacy: Calculating Realistic Income Replacement Rates
       Full report (pdf, 1.2MB, 36p.)
       Executive summary (html)

Cybersecurity - Homeland Security's role

The Government Accountability Office (GAO) recently testified before two House subcommittees on the role of the Dept. of Homeland Security (DHS) in cybersecurity and recovery from Internet disruptions. Under the Homeland Security Act of 2002, PL 107-296 (pdf, 187p.), and federal policy, DHS is responsible for the security of the nation's cyberspace, which includes Internet recovery. GAO sees DHS impeded in fulfilling its role as the government's focal point in both areas.

Cybersecurity. DHS has made progress in 13 key cybersecurity reponsibilities, e.g., the release of its National Infrastructure Protection Plan (NIPP) in June 2006, but none have been completely met. GAO sees DHS facing "a particular challenge in attaining the organizational stability and leadership it needs to gain the trust of the stakeholders in the cybersecurity world" - government as well as the private sector.

Internet recovery. GAO was asked to summarize its earlier report on this subject. It found that DHS has begun initiatives on a public/private recovery plan but its efforts are neither complete nor comprehensive. Key challenges include: (1) diffuse control of the Internet's many networks, (2) lack of consensus on DHS's role, (3) legality of DHS's ability to restore Internet service, (4) reluctance of the private sector to share information, and (5) again, leadership and organizational problems.

Critical Infrastructure Protection: DHS Leadership Needed to Enhance Cybersecurity, GAO-06-1087T, September 13, 2006
      Full testimony (pdf, 160KB, 24p.)
      Highlights (pdf, 44KB, 1p.)
      Abstract (html)

Internet Infrastructure: Challenges in Developing a Public/Private Recovery Plan, GAO-06-1100T, September 13, 2006
      Full testimony (pdf, 144KB, 26p.)
      Highlights (pdf, 44KB, 1p.)
      Abstract (html)

Earlier GAO report:
Internet Infrastructure: DHS Faces Challenges in Developing a Joint Public/Private Recovery Plan, GAO-06-672 (pdf, 2.5MB, 81p.), June 16, 2006

Report card on higher ed

The National Center for Public Policy and Higher Education, a nonprofit, nonpartisan organization based in San Jose, CA, "promotes public policies that enhance Americans' opportunities to pursue and achieve high-quality education and training beyond high school." On Sept. 7, the Center released Measuring Up 2006, the fourth in its series of biennial report cards for higher education in the nation and each state. A web page gives national snapshots of the six criteria used in the report cards:

Preparation for college: How well are young people in high school being prepared to enroll and succeed in college-level work?

Participation: Do young people and working-age adults have access to education and training beyond high school?

Affordability: How difficult is it to pay for college in each state when family income, the cost of attending college, and student financial assistance are taken into account?

Completion: Do students persist in and complete certificate and degree programs?

Benefits: How do workforce-trained and college-educated residents contribute to the economic and civic well-being of each state?

Learning: How do college-educated residents perform on a variety of measures of knowledge and skills?

Measuring Up 2006, the National Report Card on Higher Education (pdf, 1.6MB, 32p.)

Report card for Hawaii (pdf, 200KB, 16p.)

Related FR post: A model of college-level learning for the states

Assistance for assisted living

"Demand is soaring" for assisted-living facilities, the Wall Street Journal (Sept. 2, B1) reported, creating waiting lists and rising prices. The article sounds a cautionary note when shopping and provides the web site for the National Center for Assisted Living (NCAL), "the assisted living voice of the American Health Care Association (AHCA), the nation's largest organization representing long term care," for consumer information.

In March, NCAL published Assisted Living State Regulatory Review 2006 (pdf, 784KB, 180p.), with information for each state.

In Hawaii, the Dept. of Health (DOH) has an Elder Care section that includes Health Care Assurance (OHCA), which licenses health care facilities.

Cool site...for departed agencies

Need a document from a federal agency that no longer exists? You're in luck. Go to the CyberCemetery, a partnership between the University of North Texas (UNT) Libraries and the U.S. Government Printing Office (GPO) "to provide permanent public access to the Web sites and publications of defunct U.S. government agencies and commissions."

You can browse agencies by branch of government (executive, legislative, and independent commissions); by date of expiration, from the President's Advisory Panel on Federal Tax Reform, which expired in Nov. 2005, to the Office of Technology Assessment (OTA), which expired in 1995; and by name.