Friday, September 23, 2011

ASU Admissions Breakdown

Angelo State University cracked the 7,000 student mark for the first time.  The increase did not come from a traditional source, incoming freshmen.

ASU is down 155 freshmen from 2007, the year Dr. Rallo arrived as President.  That's a 7% decrease.  As documented earlier, tuition soared 60% during the same period.

These two pictures tell part of the story.

Sunday, September 18, 2011

ASU's Rallo Cites Turbulent Future

The Standard Times reported:

Angelo State University President Joseph Rallo, calling the past year "tumultuous," said at the annual State of the University address that the university must brace for a future that promises to be "as turbulent."

This is a bad year for turbulence, given ASU's precarious accreditation status. Turnover dramatically increased work loads in many departments.  Add the loss of valuable employees and the university's accreditation could be in peril.  The Texas Legislature ramped up the risk of failure with severe budget cuts.

A major factor for the university's challenging year was the Texas Legislature's ongoing decision to cut funding to state universities.

"Less than eight years ago, we received over 70 percent of our funding from the state," Rallo told the faculty, staff and students gathered in the C.J. Davidson Conference Center. "That amount is now less than 40 percent and likely to decline even more in coming years."
How much did the state contribute when Dr. Rallo came in 2007?  What has he done to fight the steady drip of state funding cuts?  Oddly, Rallo noted in Fall 2009:

So, too, is a marketing and branding budget which has grown from $30,000 to nearly $400,000 to refine our institutional message and create a family of publications with a consistent theme.
Fast forward to today:

Employee pay, except in the case of promotions, was frozen and 30 positions were eliminated through retirements or employees leaving jobs that were then not filled.

Jobs reduced through retirement or employees leaving? Tell that to the six secretaries who heard their jobs were eliminated and needed to apply for three new slots.

Dr. Rallo did add jobs at the Vice President level.  The Fall 2010 edition of ASU Magazine stated:

When Rallo became president in 2007, ASU had three vice presidents. He replaced the vice president for advancement and university relations with the strategy, planning and policy position. Until July and the arrival of Blose and Valerio, the academic and student affairs offices had reported to a single vice president.
Dr. Rallo added his fourth VP in 2010.  Instead of retrenching back to three, Rallo named a fifth in the middle of  2011's budget meltdown.  The second administrative clang came when ASU formed a group to explore Division I athletic status while shedding jobs.  A move to Division I requires a significant resource commitment.

Surely Dr. Rallo fought for his university during the tumultuous Legislative session.  Sorry.  ASU employees or alumni didn't hear any public battle cry. Search the Standard Times archive for Rallo mobilizing employees and alums to fight planned cuts. Better yet, search ASU's news releases around that time.

Area health care leaders held a public press conference to mobilize support, while Rallo remained quiet to the end.

People willingly die for leaders who fight on their behalf. They spit on the self interested and seemingly disaffected.

Data points to a shift in feeling.  ASU made the Council of Higher Education's  national list of “Great Colleges to Work For” in 2009.

ASU was one of 150 higher education institutions to be selected by the Chronicle after surveying faculty and administrators on job satisfaction in 26 categories.

It fell from the list in 2010 and 2011.  That's what leadership tumult and turbulence will do. 

COSA Health Insurance Premiums to Remain Flat

City Manager Harold Dominguez and Councilman Kendall Hirschfeld noted the receipt of "interesting bids" for health insurance for 2012.  They didn't mention the request for proposal specified four plans, the current plan plus three cheaper alternatives.  The less expensive plans allowed for a single provider and less benefits, i.e. higher out of pocket costs for employees.

For 2011 the City held the line on benefits, but passed premium increases to employees and retirees.  It hammered dependents with draconian premium increases.  Nearly 200 people, 45 employees/retirees and 147 dependents, fell from the city's insured rolls.  That act carries a cost to the community, specifically Shannon Medical Center and San Angelo Community Medical Center.  How much did their costs increase caring for the City's formerly insured?

Shannon's historical costs and charges from their Medicare Cost reports can be seen below:

One factor in Shannon's huge charge increases rise is its uninsured burden.  Shannon takes care of 4 out of 5 uninsured patients.  Price increases mean little falls through to the bottom line.  Shannon does get disproportionate share and upper payment limit program payments to help care for the uninsured, but their payor mix contributes to pricing distortions.

San Angelo Community Medical Center's charges and costs rose in a similar fashion to Shannon's.  Community takes care of 1 out of 5 of the community's uninsureds.  Community's pricing was likely driven by their corporate owners, Triad Hospitals and now Community Health Systems (CHS).

These hospitals will have to cut the City a deal for pricing to remain the same.  How will Shannon price in 160 new uninsureds from the City?  How will Community charge for 40 new uninsureds and any bad debts from higher deductibles and co-pays from city workers?  It remains to be seen.

One thing's for sure, while the city holds the line on "expenses", others will have to step in and pay.  It looks to be city employees, retirees and the few dependents left.  Should that happen, you know who to thank.

Thursday, September 15, 2011

Obama Pulls a Bush on Uninsured

President Obama talked and acted like his predecessor this week.  First, he echoed George W. who said small businesses were America's job generator.  Under W.'s tenure millions of jobs went across the Pacific to China. 

Second, Obama's Census Bureau reformulated their estimate of America's uninsureds, those without health care coverage.  Bush's Census Bureau did the same in 2004 and 2005. 

Here are the adjustments:

Bush - 1,000,000 (2004 & 2005)
Obama - 1,700,000 (2009)

If these reformulations had not occurred, the U.S. would have 52.6 million without health insurance.  Employers continue doing less, despite PPACA (something I predicted last year).

The percentage covered by employment-based health insurance declined from 56.1 percent to 55.3 percent. 
This decline should knock another 1.36 million people from employer sponsored health insurance rolls.   It only shed 500,000.

Obama's reformulation, accounting for foster children having access to Medicaid, somehow added 1 million people under employer coverage for 2009.

Here's the tale of two estimates regarding 2009:

Last year's estimate for 2009 - 169.7 million had employer coverage
This year's estimate for 2009 - 170.7 million had employer coverage

Fast forward to 2010, where the Obama administration projects 169.2 million with employer provided health insurance.  This is nearly 20 million more people than CBO projected in scoring PPACA.  What gives with the wide swings for 2010?

CBO showed employer coverage increasing under health reform, rising from 150 million to 162 million.  This clearly is a pipe dream.  Many expect the leaky, employer job-benefit dam to break in 2014, tossing millions more Americans into turbulent waters without coverage.

Over the Bush/Obama years employers covered 10% fewer Americans.  That's a 30.6 million person shift.  What employers dump, the individual or a tapped-out Uncle Sam must pick up.  That leaves many bearing lots of pain.

Update 10-5-11:  Senator Max Baucus claims 1 million young Americans have insurance due to PPACA.   That doesn't come close to making up for the 1.4 million losing employer coverage. 

Thursday, September 08, 2011

Concho Valley Health System Statistics

As America's health care system grows costlier by the minute, the Concho Valley's tenuous health landscape looks dry and parched.  Employers, the ones that still offer health insurance as a benefit, shift costs to their employees.  Both hospitals compete like heck for insured patients, not so much for those without coverage.  The burden for caring for the 30% of citizens without health insurance is significant.

The document below offers a smattering of information, bits of West Texas'health story. 

CV Health System Stats Scr

Monday, September 05, 2011

COSA's "Know Nothing" ERRP Update

The September 6 meeting of City Council will entertain the Early Retiree Reinsurance Program (ERRP) for the first time as an agenda item.  Oddly, the agenda calls the presentation an "update."   

Pertinent portions of the City's ERRP "update" are below:

History: In June 2010, the City of San Angelo learned of the opportunity to apply for the ERRP and in July 2010, submitted an application for the program. Acceptance was received on August 31, 2010. Following the 2010 open enrollment period, the Human Resources Department worked to fulfill the requirements of processing a claim for ERRP funds. The sorting and reporting of “eligible” claims is daunting and HR is simply not staffed to handle the magnitude of work surrounding this program. In April 2011, an agreement was discussed with Blue Cross/Blue Shield (BC/BS) to contract their services for this program. In May 2011 the agreement was signed. Since May 2011, no claims have been submitted to ERRP for funding due to a wide variety of reporting issues surrounded with BC/BS.

Financial Impact: Unknown at this time.

Flash back to November 2010, when this issue was first discussed with City Council.  The City hadn't planned to talk about ERRP and wouldn't have, but for Retired Police Chief Russell Smith's query:  The Standard Times wrote:

One looming question after Tuesday’s extensive city health insurance plan debate — the topic took up much of Tuesday’s City Council meeting — was whether reimbursements from the Early Retiree Reinsurance Program were included in the plan’s $1 million cost increase.

The answer is no, and will likely remain that way until the end of 2011, when the city is discussing its health insurance plan for 2012.

City Human Resources Manager Veronica Sanchez said Wednesday that the city doesn’t know exactly what claims would qualify or how much it will receive in reimbursements under the program,

Little changed in a year, except the City of San Angelo can't do what other Texas cities and BC/BS have been able to do, file an ERRP claim.  Note the ERRP "update" comes a year after the city was approved.  It's the first formal staff presentation to Council.  The topic got attention in November and December 2010 solely due to citizen comment.

As one commenter, I continued researching, reporting and writing opinion pieces on this topic.  My ERRP update differs from the city's in form and scope.  It's sad when a citizen provides the public more information than elected/paid leaders.

The program that shall "not be named" has transformed into the program that shall "not be understood."  Retirees well understand they'll bear the full brunt of any increases in 2012.  This comes after last year's premium beating.

Council's unstated perspective could well be "retirees, get a job."

Update 9-7-11: The Standard Times reported "City Human Resources and Risk Management Director Lisa Marley said the city has several claims “sitting there waiting to be processed” Sitting where?  At BC/BS or HHS?  The article continued, "She said the city is expecting to receive roughly $500,000 during both years of the program, an amount she said could make a sizable “dent” in health insurance premiums."  That dent should've been made in January 2011. 

Sunday, September 04, 2011

ERRP Update: One Citizen's Perspective

In early July 2010 the City applied for the Early Retiree Reinsurance Program (ERRP) program, which pays a large portion of early retiree health care claims.  San Angelo was approved on August 31, 2010.  Paid city consultants projected two-year ERRP reimbursement of $650,000.  A Standard Times article in mid-September 2010 quoted Human Resources Manager Lisa Marley on ERRP:

“It will either be a better (health insurance) benefit or their premiums can be lowered.”

In November 2010 Council heard about the program in a public meeting for the first time.   Retired Police Chief Russell Smith raised ERRP during public comment on proposed health insurance increases.  Despite its clear relevance to the issue at hand, no City leader, paid or elected, mentioned the program prior to Russell Smith’s utterance.  Various city leaders responded with:

"I don't have those numbers"
"There is not clarity"
"These things are hard to predict"
"When one time funds go away, you have problems"

The November minutes stated:

General discussion was held on the Early Retirement Reissuance Program (ERRP) federal grant program which allows cities to receive reimbursements on certain claims, as well as creating alternatives to make benefits affordable for both employees and retirees. Staff is currently working on the new program, therefore, information is not yet available to report. Mr. Dominguez added this is a one-time federal program which basically diverts the discussion to a later date.

ERRP arose in the December 7, 2010 meeting.  City leaders called ERRP money “iffy” and “like a lottery.”  I commented that ERRP money was like taxes, you know it’s coming, but not how much. I suggested they use some portion of expected ERRP reimbursement to offset the hardship of premium increases.  Under the lottery analogy, a submitted claim is a winning ticket.  No claim, no reimbursement.  I couldn’t conceive the City would never file a claim.

City Council chose not to apply any expected ERRP funding to relieve draconian premium increases for employee/retiree dependents.  Here’s how the December 2010 minutes masked 35-60% premium increases for dependent coverage in 2011:

... and the differential distributed to the medium and high plans, and dependent coverage across the board.
In the midst of the health insurance chaos, Human Resources mailed out the required ERRP notice to plan participants in early December.

As a result of this Council’s December actions, 45 employees/retirees and 147 dependents dropped coverage for 2011. Nearly 200 people lost city sponsored health insurance.

One might expect this to ramp up the urgency for ERRP reimbursement.

Eleven Texas cities were able to file claims and receive reimbursement.  Amarillo, Longview, Midland, Greenville, Garland, Irving and Mesquite got ERRP money, while San Angelo did not.

HR stated why:

Blue Cross/Blue Shield finally authorized access in March to allow HR the information necessary to process any ERRP claims.  The City has attempted to process the ERRP reimbursements but we simply do not have the staff to do it.  At this point it still remains unclear whether or not there are any claims that would qualify for reimbursement.  I met with the City Manager and he has agreed to pay Blue Cross/Blue Shield to process City ERRP claims.  Their cost for this service is $16,000 and we were initially trying to avoid that cost by doing it in house.

The City contracted claims submission to Blue Cross/Blue Shield by July 1.  Even with an executed contract, no claims had been filed as of late August.

Councilman Kendall Hirschfeld said in the June 28 City Council meeting that expectations were given in January or February that there be no increases in health insurance.  I checked the minutes of City Council meetings in January and February and found only one reference to health insurance:  It was under public comment:

Retiree Curtis Barsley commented on the recent increase to retiree health insurance.

I venture Mr. Barsley’s comment was not positive.  Given there is no evidence of Hirschfeld’s charge in public documents, in what meeting did members of council create this expectation for management?

Going back to the June council meeting, where health insurance was expressly discussed, staff initially proposed a $250,000 budget increase.  Council reduced that to zero.  This sets the stage for a repeat of last year’s fiasco.

There are two strategies going forward, pass increased premiums to employees and retirees or dramatically cut benefit levels.  Only one of four options in the City’s RFP is keeping current benefits.  The other three are a reduction. 

Advising City Manager Harold Dominguez is an Insurance Review Committee.  When questioned by council if any retirees sat on the committee, staff said no, but “we can do that.”  Has a retiree representative been added to the Insurance Review Committee since June 28?

One citizen spoke on behalf of retirees in the budget hearing, held August 30.  Her comments fell to floor like a tripped retiree.  Not one city official responded to her concerns.

CFO Michael Dane closed the August budget hearing with a story.  He said a year ago a council person asked him to make sure city employees received raises this year.  He suggested this private, one-person directive drove this year’s budget priorities.

A year after receiving ERRP approval, the City Council will receive a report in its September 6 meeting.  The ERRP report comes at the end of a second budget-approval cycle, where program funds could make a difference.  ERRP’s a goose egg for the second time.

Recall the secret charge given by Council to reduce health insurance expenditures year-over-year when premiums for other employers have risen 25%?  Any reduction in health insurance expenses by an employer violates ERRP's maintenance of contribution requirement.  Hirschfeld's directive could be an ERRP excluder.

Recall the siren song of “better benefits” and “lower premiums”?  The “premiums lowered” promise didn’t happen, given many experienced draconian increases in 2011.  The “better benefits” lure is impossible given the City’s bid specifications for health insurance for 2012.


The City’s inability to file an ERRP claim, with an executed BC/BS contract and while other Texas cities successfully filed claims, raises questions as to intent.  From a retiree standpoint, leaving ERRP money on the table is made worse by the City’s budgeting no new money for health insurance for the coming year.     For retirees, it’s another failed promise from City leaders, only this one is on their shoulders, not a prior council.

I'll be surprised if this conclusion is part of the City's ERRP update.  Feel free to compare and contrast Harold and Lisa's to mine.