Creative Ways of Managing Sick Kids Saves Lives and Money
by Francis P. Koster, Ed.D.
In 2011, each United States citizen's share of our total healthcare expenses was $8,402. Most of us had almost no expenses; some of us had hundreds of thousands.
[i] This was roughly one dollar out of every six spent in the United States that year for everything! [ii] That is just about twice as much as the average citizen spends on food, which turns out to be $4,229 per person, per year. [iii]
There are two significant issues here - the first is that according to reliable studies done by experts from around the world, our healthcare costs twice as much per citizen as the other developed nations with modern healthcare systems. The second is that with some notable exceptions our results are worse than the cheaper systems. [iv] And to top it all off, in some parts of our country, life expectancy is actually going down[v].
You don't have to be a Futurist to know we must do something to solve this problem.
There are five major approaches to solving the problem of America's high healthcare costs. They are pretty easy to understand.
First, we could have hidden rationing, by creating a system where some people cannot locate a doctor or hospital to serve them, as is the case in many poor and rural areas, or by making healthcare unaffordable to poor people. Or second, we could have real rationing, by not paying for things that don’t work, or bring little value. For example, we could limit government funded end of life treatment choices instead of paying for heroic and painful measures in a person known to be approaching death. Multiple studies have found that between 30 and 40% of all Medicare costs occur in the last year of life, much of it gaining only a few days or weeks before the funeral.[vi]
Third, we could cut the amount of money paid to hospitals and doctors for their services, in spite of the fact that in the last decade one third of all hospitals report they are already losing money, and that this number is growing.[vii].
Forth, as a country, we could encourage and pay for prevention and health preservation through diet, exercise, vaccination, and creating a safe environment. And fifth, we can improve the efficiency of the healthcare process. Both of these pay handsome returns on investment.
Let me tell you about some locally implementable efforts to improve the quality of, and reduce the cost of, healthcare of school children.
In the State of Delaware, the Nemours/Alfred I. duPont Hospital for Children has a mature electronic medical record, and a string of pediatricians who are affiliated with the hospital who use the same electronic medical record environment. The state also has around 200,000 kids in schools. [viii] The Nemours team partnered with the Delaware School System to develop a novel approach – they would enhance communication across the continuum of care by incorporating the school nurse as part of the care team. With parental permission, the Nurse is able to access NemoursLink® a web-based portal providing access to the Nemours Electronic Medical Record.
The pilot project involved 11 schools, in two school districts. The nurses focused on sick children who were high on their radar. Early indications are that allowing the school nurse and the doctor's office to share in viewing the common picture of the child's disease is valuable enough that the project is being expanded.[ix]
Another project is underway in Louisiana, where the Picard Center is negotiating with the state Medicaid program - which covers 70% of the kids - to create a common, parent authorized, electronic medical record system so that doctors, hospitals and school nurses can all see what the others are doing.
A similar project done in Florida found that the school systems costs of the project could be covered by the tuition dollars they gained by having the chronically ill child well enough to attend school (if a sick child misses to many school days, the school does not get paid their tuition from the taxpayer). In other words, electronically connecting school nurses to the child's doctors office resulted in healthier kids, health care costs going down, school attendance going up, and both family and school system were better off financially.[xi]
Given the five choices for lowering the cost of healthcare, I would prefer to focus on prevention, and efficient disease management, as these projects have done. The savings in dollars and suffering can be considerable. And it can be done locally, using tools now well understood.
In some cases we don't need to fear the future - we need to grab for it.
[i] [i] The Kaiser Family Foundation http://www.kff.org/insurance/upload/7670-03.pdf
[ii] The Kaiser Family Foundation http://www.kff.org/insurance/upload/7670-03.pdf
[iii] http://www.ers.usda.gov/data-products/food-expenditures.aspx, Table 13, Column E, line 64.
[vi] http://www.nursingeconomics.net/ce/2014/article3003127134.pdf page 3
[vii] http://www.aha.org/research/rc/stat-studies/Studies.shtml, page 27
[ix] http://www.fierceemr.com/story/pilot-program-gives-school-nurses-access-students-ehrs/2012-05-24 and email exchanges with Nemours Public Affairs, who reviewed the content for accuracy.
[x] Personal telephone conversation with Health Sciences Director John LaCour October 16, 2012. Also http://www.picardcenter.org/Pages/home.aspx
[xi] http://www.hoise.com/vmw/06/articles/vmw/LV-VM-10-06-13.html, reporting on a project I was Principal Investigator on. Substantial other backup available.
Local Investors Can Lower Taxpayer Costs While Creating Jobs
by Francis P. Koster, Ed.D.
One of the largest contributors to making a community poor is to spend big dollars on energy created elsewhere. A dollar spent on coal or oil or natural gas leaves the neighborhood forever, and therefore cannot pay for local labor or local services – an exported dollar that hurts everyone.
A strategy that some communities have used to reduce the outflow of money used to purchase energy is to invite private investors to invest in public buildings in exchange for a share of the energy savings achieved. One example of private money investing in not-for-profit buildings can be found at Wellesley College located outside Boston in Wellesley, MA. They contracted for a private investment group to replace their parking garage lights, and saved $26,536 the first year without spending a penny. The project was completed in two weeks, without any disruption to the parking operation of the garage. The retrofit project reduced energy consumption by 57%, increased light levels by 32%, and doubled the fixture’s lamp life, which reduced maintenance costs. Light bills went down $26,536 annually, and maintenance costs were reduced almost $4,000. Because the private investor could take advantage of favorable tax treatment that the school could not, the actual net investment was less than $40,000, resulting in an 81% return on investment split between the investor and the school (which put in no money).
In order to imitate these success stories, the host school, or city hall, or bus system negotiates a business arrangement with a local investor, who pays for new windows or air conditioning equipment, or updated engines – all of which save a lot of money this year, next year, endlessly. The taxpayer energy cost goes down, and the investor earns a handsome rate of return from the savings – and it is safe, because if there are no savings, there is no return to the investor. As a rule of thumb, almost any mature building can achieve a savings of 25% in energy costs by installing “low hanging fruit” energy conservation. This creates the opportunity for a private investor to realize a negotiated payback rate of , lets say, 15% for a fixed period of time, and the taxpayer the other 10% (for no outlay of money) until the investor has achieved their return, after which the taxpayer receives the full 25%. Additional incentives which are available to private investors exist in the form of federal and state tax incentives which public institutions financing their own improvement cannot take advantage of. However, the same investment made in the same building by a private investor can qualify under some circumstances, and bring many sound investments into the exciting range. All of these investments return more than the bond market is likely to pay for the foreseeable future. A useful reference book is Climate Capitalism, by l. Hunter Lovins, and the work done by The Climate Corps of the Environmental Defense Fund (which identified cost effective investment opportunities in the range of 46% reduction in energy use in public buildings!), found at http://www.edf.org/page.cfm?tagID=60252.
One thing that you could do is ask your elected officials how much taxpayer money is spent on energy for public facilities, including schools. If the total number is attention getting, (and I bet it is) the officials could issue a Request For Proposals offering local private investors the opportunity to participate in a win/win/win/win (lower taxes/jobs created/money staying in the community/lower pollution).
Many many cities and towns have adopted this method of financing energy conservation. For a very long list of further information, simply google “shared savings energy conservation”.
To assist the Editor in Fact Checking:
The Welsly example came from Groome Energy, located in Salem Mass. I spoke to one of the owners there, who referred to me this case study on their website. http://www.groomenergy.com/case_study_ges_hybrid_lighting.html
School Salad Bars Fight Obesity and Help Farmers
By Francis P. Koster, Ed.D.
One quarter of all US counties saw an actual reduction in life expectancy for women between 1997 and 2007. Girls born today are expected to live shorter lives than their mothers. Boys are also seeing declines in life expectancy - in some parts of the United States, the average male would live longer if they lived in Africa! Our country is now ranked 50th in the world for life expectancy!iii What is going on here?
Much of this downward path has been proven to be caused by eating habits which are formed as youngsters. The result is that over 1/3 of our fellow citizens are obese, and another 1/3 are overweight enough to shorten their livesiv.
Pediatricians are now routinely performing tests on youngsters for heart disease and diabetes – which as recently as 15 years ago were considered diseases of adults. Unless we adults do something, this does not bode well for our kids, or our country.
Another startling factoid: one in two American school children are now eligible to receive free or reduced price lunches due to their poverty level. You read that right - 31 million kids out of 55 million get subsidized food due to their poverty level.
And those lunches, aimed right at the less fortunate among us, help make them fat. The USDA school lunch program design approved in 2005 allowed less than 5 percent of the budget to purchase fresh fruits and vegetables.v
It is one thing to have a nation devastated by an epidemic caused by germs and infection - that may be out of our control. It is another to cause this level of devastation by feeding our kids badly. The first may be visited on us.....the second surely is a self inflicted wound.
A few years ago, a pilot project to reform the school lunch program by expanding the offerings of fruits and vegetables at an cost of between 5 and 14 cents per meal was started at the federal level to see what the impact would be. Results were very impressive, and expansion was planned, but it was objected to by the food industry and some elected officials who expressed concern over its budget impacts, and expansion was stopped in October of 2011.
My college Linda van Slyke found some wonderful examples of success stories by reviewing projects done during the pilot phase, and uncovered some other projects initiated by local community leaders acting with local funds and initiative. They provide us with a powerful path forward.
California’s Riverside Unified School District (RUSD) has a K-6 Farm to School Program. Its Farmers’ Market Salad Bar is stocked daily with 50-100% of locally-grown produce (depending upon the season). Special efforts are made to include community farmers in the program by incorporating visits by farmers to the classrooms, and visits by students to the farms. Teacher training and specialized curricula are also a part of these efforts. The program began with the help of grant funding in 2005, but RUSD is now sustaining the program with its own funding resources.vi A 2008-2009 research study by the University of North Carolina at Chapel Hill found that “food costs were no greater in the salad bar schools compared to the comparison schools.”vii This study also found that this RUSD program “generates revenue for small farmers.” viii
New Haven Public schools began the switch to whole grains two years ago and now offers salad bars in 85% of its 46 public schools. The school system has also increased the amount of green and orange vegetables, and serves brown rice instead of white. Students get involved on a farm-to-table level via community gardens at some schools where they can grow vegetables that are then made available on the salad bar. ix
In 2000, LAUSD launched a salad-bar program in three of its schools. They saw an 84% increase in fruit-and-vegetable consumption during lunch. More than half the children chose the salad bar for lunch on any given school day. These benefits were accompanied by a significant daily decrease in the children’s total calories, as well as in their consumption of cholesterol and saturated fats.x
Many other schools would like to imitate these success stories, but are blocked by lack of funds - they don't have the extra 5-14 cents per meal per day it would take.
It is time to acknowledge that we have a major national problem on our hands.
And this is a "pay me now or pay me later" problem for the taxpayer. Cough up the pennies per day for good school food, or the hundreds and thousands of dollars a day for doctors and hospital care later.
This is up to the adults to fix, acting as good parents, elected officials, and caring people. You can help by working with your local schools to develop a system of measurements about food offerings, and weight gains among students, and devising programs to get locally grown fruits and vegetables to the students. The besieged school administrators need you to support them - and so does our country.
1) Life expectancy in most US counties falls behind world’s healthiest nationsInstitute for Health Metrics and Evaluation (IHME) at the University of Washington. June 15, 2011
iv http://www.cdc.gov/nchs/fastats/overwt.htm, June 2011 data tables
vi Riverside Unified School District Farmers Market Salad Bar program.Center for Food and Justice, Occidental College
Energy Debates Confuse Price with True Costs
by Francis P. Koster, Ed.D.
If your neighbor had a beef cow that routinely broke the fence and ate your hay, come time the cow was turned into hamburger your neighbor got wealthier at your expense.
Because the guy who owned the cow did not have to pay for some of the cow’s food, the “price” of the beef would be artificially low. You subsidized him — you provided part of the true “cost” of production for no compensation. The “price” and the “cost” of the beef were not the same, although they should have been. This kind of subsidy disrupts free market economics.
There are side effects when price and cost are different, and this difference impacts our energy future.
There are two kinds of subsidies that cause price and cost to take different paths.
The first is outright government subsidy, practiced by many governments around the world.
Our own government has a long history of taxpayer subsidy to emerging new industries to help them get on their feet. Recipients of this include the railroad industry in the 19th century, the oil and gas industry in the early 1900s, the coal industry in the 1930s and the nuclear power industry in the 1950s. The current hot political debate about “picking winners and losers” has been ongoing for almost 200 years.
Duke University has produced an interesting report on the history of taxpayer subsidy for energy suppliers. It shows that the highest subsidies occur during the first 15 years of a new energy industry. Comparing renewable energy to nuclear power, coal and oil, nuclear got eight times more subsidy than renewables; oil got five times more. The natural gas industry also got five times more. These subsidies to nuclear, coal and oil continue in some form and amount today. (The renewable energy subsidies were just reduced dramatically.)
The second form of subsidy might be called the “cow pie subsidy.” One way to look at this is to imagine that the cow who ate your hay also wandered into your living room and left you a present. You would have to pay to have the mess cleaned up. Again, because your neighbor moved some cleanup costs off his books and onto yours, his price to the consumer can go down. Your pain was his gain.
Many organizations are interested in behaving like your neighbor with the cow. They would like to get subsidies and leave a mess behind for others to pay to clean up.
The “cow pie subsidy” can be shown in all areas of our energy economy. Here are some examples from the coal industry. West Virginia University researchers found that citizens living in coal mining towns have a one-third greater incidence of high blood pressure, two-thirds higher risk for developing chronic obstructive pulmonary disease (COPD), and more than two-thirds higher risk of developing kidney disease. The birth defect rate in areas where mountain top coal removal is done was 235 per 10,000 live births, compared to 144 in non-mining areas, according to a separate study done in 2011 by Washington State University. This is a cost paid by these victims so that the price the rest of us pay for coal-fired electricity is kept low.
After being mined, when this coal is burned to make electricity near your home, this kind of cost becomes yours as well. Communities located near coal-fired electrical generating plants have health care per individual two to five times greater for folks living near the plant than for those living farther away, totaling in excess of $4 billion annually.
Take all those health impacts, add to them the taxpayer subsidies, and you have one large distortion of the market place.
We can create a better future for our country, and our children, by counting all the costs into the price of energy, including subsidies and harm done to our family and friends. If we do, we will make better choices.