Why health reform matters — especially in rural Iowa

Iowa’s 1.2 million rural residents need increased access to affordable, quality health insurance

2009-AC
Andrew Cannon

On the eve of her marriage, Suzanne Castello, a Grinnell resident, looked forward to quitting her job at a community college and working the family farm with her husband full time.

Though Castello had enjoyed good health benefits at her off-farm job, her husband had been covered through an insurance plan purchased on the non-group, private market for a number of years, and they assumed that adding her to the plan would not be a problem.

Due to a previous miscarriage and a chronic jaw ailment, Castello was denied coverage. Around the same time, Castello and her husband learned that she was pregnant. The Castellos continued to search for an insurance plan that would cover her and had some luck, though the plans that would agree to cover her had a 10-month pre-existing condition exclusion — no insurer would cover the pregnancy.

Castello enrolled in COBRA — the federal legislation that allows workers to continue their job-based coverage for up to 18 months, COBRA enrollees must pay 102 percent of the premium cost.

“We were hemorrhaging money, but we didn’t qualify for Medicaid,” Castello said. “It really rankles me that we’re seeing something as fundamental as childbirth as kind of like, ‘Would you like dessert with that meal?’ There’s a double-standard between group policies and individual policies, which cover most farmers.”

Though the pregnancy was complication-free and Castello has enjoyed good health since then, finding affordable insurance is still a challenge for her.

“Right now, I have the flavor-aid version of an insurance policy – it’s high-deductible, high cost-sharing. It’s basically just coverage for catastrophic events, because the deductible is so high,” Castello said.

“It’s irksome that I’m a healthy person and I can’t get decent health insurance.”

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Nearly 20 percent of America’s uninsured live in rural areas. Of those, if they do not have insurance through an employer-sponsored plan or public coverage, such as Medicaid, they have to buy a plan on the non-group market. This is especially expensive, as the costs are not spread across a larger group of employees and their families.

Nationally, only 8 percent of the population receives its insurance through the non-group market. In Iowa, up to 37 percent of rural residents get insurance this way, subjecting them to high premiums for less-regulated plans that can deny coverage for a pre-existing condition for up to 12 months.

Iowa’s 1.2 million rural residents need increased access to affordable, quality health insurance.

Posted by Andrew Cannon, Research Associate.

See Cannon’s IPP Snapshot: Health coverage in rural Iowa.

Workforce Education: Good investment for Iowa

No matter the indicator — unemployment rates, wages or poverty — it is undeniable that education pays for Iowans.

Lily French
Lily French

Investments in workforce education improve economic prospects for Iowa families, and in the process boost the state budget. We have found that investing in postsecondary education for low-income adults returns tax revenue more than double the state’s costs. In fact, the state can garner $3.70 in increased tax revenue for every dollar invested in an associate’s degree and $2.40 for every dollar invested in a bachelor’s degree for low-income adults. (See Education Pays in Iowa, Executive Summary; Full Report)

State investments in workforce education can also greatly improve the economic futures of Iowans struggling to support their families. No matter the indicator — unemployment rates, wages or poverty — it is undeniable that education pays for Iowans. In a state where wages are stagnating for less-educated workers, many Iowans were having a difficult time making ends meet even before the current recession began.

Further, a projected shortage of skilled labor combined with the rising cost to families for postsecondary education demands that Iowa invest in workforce education to address our state’s education gap. When low-income adults have access to increased education and training, their lifetime earnings increase substantially, generating tax revenue for the state that more than offsets the cost of investing in this access.

To garner the largest fiscal returns and set the state firmly on the path toward economic growth, Iowa should:

■ Expand financial aid to help low-income working adults pay for postsecondary education, by

  • creating a tuition scholarship program for low-income workers to pursue an associate or bachelor’s degree at one of Iowa’s public colleges;
  • fully funding Iowa Work-Study at its standing-limited appropriation of $2.75 million.

■ Promote education and training within Iowa’s TANF program, by

  • directing program administrators and case managers to promote education with Promise Job clients;
  • using American Recovery and Reinvestment Act (ARRA) TANF Emergency Contingency funds to support education and training for a greater number of TANF participants.

■ Modify Iowa’s WIA plan to enhance training provisions, by

  • setting local funds for training at minimum level required for eligibility to additional discretionary funds;
  • using discretionary funds to advance postsecondary educational opportunities.

Expanding access to education and training for low-wage workers is particularly important when economic prospects are dim. An investment in workforce skills would prepare Iowans for the future and contribute to rebuilding our economy.

Posted by Lily French, Research Associate/Outreach Coordinator

Excerpted from Lily’s written testimony to the Iowa legislative Job Training Needs Study Committee, Nov. 3, 2009. Also see the IPP backgrounder.

Numbers, numbers, numbers … People!

It’s a familiar refrain in the office each month when we put together our analysis of Iowa’s latest job numbers: There sure are a lot of numbers!

That’s an understandable reaction. Too many numbers can obscure the message, something we consider in our analysis of public policy issues at the Iowa Policy Project.

So, we try to strike the right balance. How many numbers do we need to tell the story — accurately and in context?

Goodness knows these days, too many people out there will torture numbers to extremes if it helps their message. We prefer to review the numbers and then figure out what the message should be.

This month, as IPP Executive Director David Osterberg noted in his comments in our news release, “Good news is hard to find in these numbers.” There was only a 200-job loss in nonfarm jobs in August — but even that good news came with a major downward revision in the previous month’s numbers. July’s job loss, previously reported at 2,400, is now recorded at 4,400.

Iowa payroll jobs have dropped in 11 of the last 12 months
Iowa payroll jobs have dropped in 11 of the last 12 months

Furthermore, those numbers show Iowa:

  • has lost payroll jobs in 11 of the last 12 months. (See graph at right.)
  • has shown a net loss of 49,400 nonfarm jobs in that same period — 28,000 of them in manufacturing.
  • has seen its unemployment rate jump to 6.8 percent in August from 4.2 percent a year earlier (an increase of over 60 percent).

And we could go on, with lots more numbers. And as long as they help to tell the story, we will do that.

But they will only tell the story if we always keep in mind that those numbers represent people — Iowans, our friends and neighbors — and the places they can go to work and support their families.

We can’t wait until those numbers start looking better, month after month. That will make it a little easier when we look at our first draft and say, There sure are a lot of numbers!

Posted by Mike Owen, Assistant Director

A view of IPP research, from a researcher

Molly Fleming
Molly Fleming

As I begin my final year at the University of Iowa’s graduate program for Urban and Regional Planning, I have been fortunate to join the Iowa Policy Project as a part-time research assistant. This opportunity allows me to integrate my interest and experience in public policy with fact-based research and analysis. Given public confusion and misperception regarding such critical issues as health care, taxes and the environment, objective research is vital to ensure government accountability and citizen engagement. I am very pleased to be able to assist in this important work.

As a volunteer at the Iowa Policy Project last spring, I helped former research associate Beth Pearson to determine the benefits of home weatherization for low-income Iowans. Additionally, I helped to compare how alternative versions of climate change legislation could promote or harm public welfare. The research skills I gained from this experience have been invaluable, and I hope to build upon them throughout the coming year.

Under the guidance of Peter Fisher and other members of the wonderful IPP staff, I will look at the effects of the American Recovery and Reinvestment Act on Iowa’s economy. I also plan to take a hard look at Iowa’s budget allocations throughout the year and the rising cost of living within our state. It is my hope that this research will help to spark good ideas and influence important public policy. As the challenges and prospects facing Iowans evolve during this time of economic uncertainty, the Iowa Policy Project’s work is more important than ever. I am both honored and excited to be a part of the IPP at such an exciting time, and I look forward to my year here.

Posted by Molly Fleming, Research Assistant

IPP Open House packs ’em in

Christine Ralston
Christine Ralston

Wow, what an event. Friday afternoon, the Iowa Policy Project hosted an open house and FRIENDraiser at our new office in Old Brick.

We packed the office with friends and supporters. Guests had the opportunity to meet and talk with IPP staff, old IPP staff greeted longtime friends and new staffers were able to meet many of IPP’s friends and supporters.

The event was an opportunity for IPP to show off our new, spacious office. The organization has increased from five to nine staff members in just two years, so our old space was getting a bit cozy.

Our new space has several private offices, a research room and a separate conference room which was dedicated in honor of IPP co-founder Mark Smith.

Mark helped found IPP in 2001 in collaboration with IPP’s Executive Director, David Osterberg. Mark is perhaps best known as former president of the Iowa Federation of Labor, AFL-CIO. For 34 years, Mark worked tirelessly in education, organizing and advocacy for Iowa’s working families.

A short presentation included remarks by David about IPP history and Mark’s contribution to the organization as well as Mark’s remarks about the founding, work and expansion of the Iowa Policy Project.

David Osterberg speaks at IPP's Open House
David Osterberg speaks at IPP's Open House

The event was open to the public. Attendees included past and present members of the IPP board, friends and supporters of IPP’s work and several of our nearby elected officials: Congressman Dave Loebsack, State Senator Joe Bolkcom of Iowa City, State Representative Nate Willems of Mount Vernon, and Johnson County Supervisor Rod Sullivan.

Many, many thanks to those of you who took the time to come and speak with us, see our new offices and make donations in support of our work. We truly appreciate it.

Posted by Christine Ralston, Research Associate

It’s the revenues, Iowans

Iowa’s declining revenues are at the root of the state’s budget problems, leaving Iowa open to the impact of the recession. In fact, the Iowa Fiscal Partnership released a report today detailing the role of revenue changes in our state’s budget crisis.

Iowa’s general spending grew at the same rate as the economy in the 1990s, but after the 2001 recession, spending never caught up to the levels of the growing economy — even though it has increased slightly over the past three years.

State spending in 2008 was 5.45 percent of the economy, 16 percent lower than it was in the 1990s.

Beth Pearson, an Iowa Policy Project research associate who co-authored the report, said tax reductions between 1996 and 2004 have contributed to Iowa’s budget crisis. These breaks cost the state an estimated $650 million in forgone revenue in 2004 alone.

Iowa policy makers need to keep a long-term focus, and to consider all spending, including spending through the tax code.

For more information on the report, visit our website at: www.IowaPolicyProject.org, or find the report here. For timely updates, follow our IaPolicyProject Twitter account.