I’ve railed for awhile re: one of ObamaCare’s most popular benefits … forcing insurance companies to allow “adult-children” to be appended to their parents’ health insurance policies.
I wouldn’t mind if they – or more accurately, their parents – were paying for the coverage … but they typically aren’t
All other folks are being forced to pay higher premiums to cover the added costs.
Let me explain the economics and tie it to another likely ObamaCare “glitch” …
Let’s see ….
The original ObamaCare law said that an insurance applicant’s eligibility should be verified before they’re granted a Federal premium subsidy.
Sounds easy enough.
But then, out of the blue, President Obama modifies the law on-the-fly with an Executive Order to fugetaboutit..
You know, just go by the honor system.
Hmmm.
Anybody remember the “liar loans” that played a central role in the financial crisis?
Then the budget brouhaha gets settled by reinstating the original law’s requirement that an applicant’s eligibility be verified before a subsidy is granted.
Essentially, eligibility is based on income.
Which led my wife to ask me a question that cuts to the core of the ObamaCare systems issue.
My wife’s question: “Why is verifying income so hard?
If people have to submit their Social Security numbers when applying for ObamaCare, can’t they just ask the the IRS system how much income the people make ?”
Good question.
But, a question that opens up a veritable Pandora’s box. …
Let’s think out-of-the-box and resolve the flap over the Washington Redskins name.
It seems that in every odd number year, there’s a controversy … and pressure is get the Redskins to change their name.
Apparently some folks think the name is offensive to native Americans.
No kidding.
Well, I have a creative idea for resolving this bruhaha …
The recent Forbe’s article that we reported on yesterday said that the ObamaCare web site gets bogged down because folks need to enter their private info in order to get a premium quote.
Why?
Forbes (and other pundits) say that the “list price” of the premiums are much higher than people expect … so the Feds want to calculate the ObamaCare subsideis first and quote people a net price … after taking the subsidies into account.
That got me curious.
How much are ObamaCare premiums … and what are the policy terms & conditions re: deductibles, co-pays, etc.?
So, I did some hunting … and, in fact, it takes some hunting.
Best source that I found is a tool developed by the Kaiser Family Foundation (link below).
The Kaiser calculator requires just a couple of inputs … no private information.
Here’s what I input: Family of 4, non-smokers, $100K household income.
OK, place your bets.
What do think the annual premium would be?
A case study in how not to develop and launch new systems
Why isn’t the system able to do the basics?
You know: log people in, tell them the price, sign them up and, oh yeah, keep people’s private information secure.
Some of the problems are structural … what happens when you try to inter-connect old legacy systems … each with a humongous, uniquely-designed database.
Other problems are self-inflicted … either amateurish design or intentional strategic specifications built into the design.
As a recovering systems designer and CIO — and, oh yeah, a pricing prof — here’s my take ..
My students are likely to cringe at this post which kinda legitimizes my teaching style.
Uh-oh …
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According to a recent WSJ article:
The latest findings in fields from music to math to medicine lead to a single, startling conclusion: It’s time to revive old-fashioned education.
Not just traditional but old-fashioned in the sense that so many of us knew as kids, with strict discipline and unyielding demands.
Why?
Because here’s the thing: It works.
Of course, that conclusion flies in the face of the kinder, gentler philosophy that has dominated American education over the past few decades.
The conventional wisdom holds that teachers are supposed to tease knowledge out of students, rather than pound it into their heads.
Projects and collaborative learning are applauded; traditional methods like lecturing and memorization — derided as “drill and kill” — are frowned upon, dismissed as a surefire way to suck young minds dry of creativity and motivation.
But the conventional wisdom is wrong.
And the following eight principles explain why …
I oft say that anybody who pays sticker price at Kohl’s should look over their shoulder to make sure that Darwin isn’t chasing them.
Maybe the same should be said of parents who pay list price tuition to fund their kiddies through college.
Lots of talk re: how college costs are soaring.
According to the WSJ …
Published tuition rates have soared in the last decade, but only a small percentage of families actually pays full freight.
Between grants to needy students and merit scholarships to entice other desirable candidates, schools these days are giving back nearly 50% of gross tuition revenue in the form of aid and awards.
In other words, list prices are going up, but more stuff is being sold at sale prices.
Increasingly, colleges are using pricing methods previously the domain of airlines and discount retailers …
Lots of hysteria re: the debt limit.
Key question: will the U.S. really default on its debt obligations if the debt limit isn’t raised?
Answer: Only if that’s what the Treasury Department wants to do.
Basic facts:
The Treasury receives about $250 billion in tax receipts every month.
Interest on the debt is about $30 billion per month (@ an average interest rate of about 2%)
So, plenty of money to cover interest on the debt.
What’s the rub?
Some calamitists say: “No legal way to prioritize who gets paid. Gotta pay all obligations.”
Easy answer: Cut the flow of obligations.
As the shutdown is showing, we can tell NASA, HUD, EPA, and Education to stay home for awhile and we won’t miss a beat.
Cut expenses, cut obligations. Easy as that.
But, Business Insider says that the government doesn’t have sophisticated enough computer systems to prioritize the cutting of checks.
If the ObamaCare exchanges are representative, they may be right on that one.
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Here’s a clip worth watching.
David Stockman – former OMB head – speaks to the issue … he says default won’t happen.
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Great infographic from CBC News … re: the U.S. Debt limit.
Takeaways below the chart …
As commonly known, the debt limit has surged under both Bush and Obama.
The debt to GDP ratio has soared under Obama … after being flat for about 20 years.
Of course, part of the ratio increase is tied to the denominator … the debt has increased faster than the slow economic recovery.
Biggest surprise (to me) is that The “inflection point” – when the debt really started to takeoff was during the Reagan presidency.
So what?
Upward trajectory has to end some day, right?
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click to play with the infographic … worth browsing.
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Couple data points converged for me …
First, loyal readers may remember that I was an identity theft victim.
Started a couple of weeks after my first e-filing of a tax return to the IRS.
Coincidence?
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Being sensitized to the ID theft issue, I noticed a couple of recent articles about “ripe pickings” …
I’ve been amused by the Dems squawking about the way that the GOP Congress has linked ObamaCare to the Budget’s “continuing resolution”.
Foul. Fight fair. Never done. Blah-blah-blah.
Here’s the ironic twist …
Remember how Obama Care was passed?
To refresh your memory, and see the irony …
Question: in a partial government shutdown, like the one underway at the moment, how much of the government is actually shut down, and how much is not?
Answer: About 17%.shut down; 83% up and running
Details below …
“Based on estimates drawn from CBO and OMB data, 83 percent of government operations will continue.
This figure assumes that the government pays amounts due on appropriations obligated before the shutdown ($512 billion), spends $225 billion on exempted military and civilian personnel, pays entitlement benefits for those found eligible before the shutdown (about $2 trillion), and pays interest costs when due ($237 billion).
This is about 83 percent of projected 2014 spending of $3.6 trillion.” Source
Hmmm.
And, let’s drill down on who actually got furloughed …
All the pundits are saying that President Obama is winning big as the GOP’s ham-handles the government shut down.
Hmmm.
Apparently the pundits don’t look at the numbers.
On Friday, Obama’s sagging approval ratings dropped to 41% in Gallup’s daily tracking poll.
With a 52% disapproval rating, that puts him 11 points underwater in a poll that generally leans a bit to the left.
If you think that Gallup is an outlier, then keep reading …
Guess what: Big batteries – when subjected to trauma – catch fire … whether in the air (787) or on the ground (Tesla).
Earlier this week, a Youtube was posted showing a Tesla on fire.
Audio: “Dude, that’s a brand new car … wow”
click to view
Here are some details …
First, a quick refresher course courtesy of the Government Finance Officers Association (of Canada, that is).
When using zero-base budgeting (ZBB), a government builds a budget from the ground up, starting from zero.
There has been renewed interest in ZBB in today’s environment of fiscal constraint, not least because the “zero” in zero-base budgeting sends a powerful message that taxes and spending will be held in check.
Zero-base budgeting, also known simply as ZBB, has had a long … history in the public sector.
Zero-base budgeting first rose to prominence in government in the 1970s when U.S. President Jimmy Carter promised to balance the federal budget in his first term and reform the federal budgeting system using zero-base budgeting, a system he had used while governor of Georgia.
ZBB, as Carter and budget theorists envisioned it, requires expenditure proposals to compete for funding on an equal basis – starting from zero. In theory, the organization’s entire budget needs to be justified and approved, rather than just the incremental change from the prior year.
Today, there is an apparent resurgent interest in ZBB.
GFOA’s survey shows that traditional budgeting methods, namely line-item and incremental budgeting, have declined in use in the last few years, while all forms of budgeting that are thought to be better adapted to cutting back the budget, not just ZBB, have increased Source
OK, they’re talking about Canada, not the U.S.
Still a couple of takeaways:
1. The process – in government, at least – traces back to Jimmy Carter.
2. Many Canadian governments are using ZBB
3. In Canada, the use of ZBB is increasing
Now. here’s what I think is interesting …
Although they stumbled into it, the GOP may have landed on a masterful plan.
In effect, the GOP’s piecemeal approach to unraveling the government shutdown is nothing more than real-time ZBB.
Think about it for a second.
A week ago the gambit was to fund everything except ObamaCare.
Non-starter, right?
Now, in concept at least, the piecemealing approach allows everything to be funded … except ObamaCare.
Everything that matters – either really or because of political optics – can be quickly restored with short, separate authorization bills.
Anything that’s questionable stays squashed.
Anything that’s essential gets an appropriation,
Eventually everything that’s essential gets funded.
Gee, that sounds like zero-based budgeting, doesn’t it?
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According to BigThink.com …
The website ratemyprofessors.com has students anonymously comment on their professors’ “helpfulness,” “clarity” and “easiness.”
The punctuation point: Raters are asked where the prof is “hot” or “not.”
Four professors from Central Michigan University trolled through the data and wrote a paper examining “Attractiveness, Easiness, and Other Issues: Student Evaluations of Professors on rateMyProfessors.com.”
After conceding that the site is rife with “issues”, the authors dug in and researched the relationship between student perceptions of professor “hotness” and their evaluation of “quality of instruction.”.
Guess what?
A large percentage of American college students consider courses to be high-quality when the professor is attractive..
As Gomer Pyle would say: “Surprise, surprise, surprise.”
The only surprise is the magnitude and consistency of the relationship.
Profs that are “not hot” are toast.
The Central Michigan “scholars” also evaluated the relative hotness of profs by discipline …
Two related articles caught my eye …
First, the WSJ said that “something at Wharton doesn’t add up”.
Applications to the University of Pennsylvania’s business school have declined 12% in the past four years.
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Of course, Wharton claims that they’re going after quality, not quantity.
Wharton says the decline, combined with a stronger applicant pool and a higher percentage of accepted applicants who enroll, proves that the school is doing a better job targeting candidates.
But business-school experts and b-school applicants say Wharton has lost its luster as students’ interests shift from finance to technology and entrepreneurship.
One non-applicant observed: “Wharton is typecast as the finance school … going to business school isn’t about going into the financial sector any more.”
Some admissions advisers and Wharton professors agree, saying that the school didn’t react aggressively enough when the spigot of finance jobs was turned off.
Even though applications may be down, Wharton’s brand still has drawing power … here’s proof.
From the “you can’t make this stuff up” file …
There has been a lot of chatter recently re: the value of a college education … tuitions are up, high paying job are scarce, “adult-children” hang on their parents’ health insurance policies until they’re 26, some move back in with mom and dad.
In these uncertain times, how are college students responding?
Here’s one answer …
Dateline Providence. R.I.: Brown University Students To Host Nudity Week
OK, I.m a control freak.
There, I said it.
Along the way, somebody passed along a memorable observations:
“You can’t control everything that happens to you, but you can always control the the way you respond to it.”
Fast forward.
A couple of night’s ago, I was watching a replay of the Ohio State Cal game from the prior weekend.
The announcers said that Urban Meyer – OSU’s head coach — preaches the E+R=O principle to his players … even has them wear wristbands.
Say, what?
I ran and googled E+R=O
Answer: Event + Response = Outcome
Hmmmm … sounds familiar.
And, there’s more …
All the hoopla surrounding the iPhone 5 launch reminded me of an ad campaign run by a company called Blendtec.
According to George Parker of AdScam ….
At a conference a couple of years ago. GE and their agency, BBDO, made a presentation of their new “Imagination” campaign.
After showing some nice TV spots and explaining that they’d spent $300 million on media over the last year, they proudly declared that brand awareness had increased substantially.
This generated polite applause.
Next up was the Marketing Director of blender manufacturer Blendtec who proceeded to blend:
He then put up a single slide showing that every time they posted a self-produced, ten dollar video on YouTube in their long-running “Will It Blend” campaign (which to-date has had more than 220 million views,) sales went up by an accurately measurable percentage.
Understandably, the crowd went nuts.
The point being, GE spent hundreds of millions and couldn’t quantify with any certainty what they had achieved for all that money.
Blendtec spent pennies and achieved consistently significant and measurable results.
Below is the links to the Blendtec iPhone videos… worth watching.
During the recent economic “recovery”, unemployment rates have started to recede, in part because many folks are leaving the labor force.
Some of the “leavers” are retiring … some are going to college … some are signing up to collect SSDI – Social security Disability Insurance..
There has been a sharp increase in SSDI applications over the past couple of years.
Most of the applications are probably legit, with some rise due to increasingly diagnosed bad backs and mental health issues..
But, any reasonable person knows that the rolls are also increasing due to fraud – folks taking advantage of the program as a substitute for welfare.
What’s the government doing about that?
Nothing, as far as I can tell
But, there are other instances of disability fraud, and one victimized company has had enough and is cracking down ….
I’ve been meaning to write about this for awhile – and since it’s back in the news, I’ll take my shot.
You’ve probably heard that Congress and Congressional staffs – as part of the ObamaCare law – were required to get their health insurance on the newly forming ObamaCare exchanges and give up some of their generous government subsidies.
More specifically:
The ObamaCare Act applied to Congress the same civil-rights employment and labor laws that lawmakers had required everyday citizens to abide by.
With some lapses, it’s worked well to defuse public outrage about “one law for thee, one law for me” congressional behavior.
In 2009, Senator Chuck Grassley decided that the principle deserved to be embedded in Obamacare, and he was able to insert a provision requiring all members of Congress and their staffs to get insurance through the Obamacare health exchanges.
“The more that Congress experiences the laws it passes, the better,” said Grassley.
Most employment lawyers interpreted that to mean that the taxpayer-funded federal health-insurance subsidies dispensed to those on Congress’s payroll — which now range from $5,000 to $11,000 a year — would have to end.
Makes sense to me – make them eat their own cooking.
But, there’s much more to this story …
You’ve seen some of Bud Light’s commercials showing the strange superstitious stuff that people do to “help” their sports teams.
You know, like sit in the same chair to watch games on TV … or eat the same food before every game … or turn their caps around for a rally.
The tagline for the commercials is “It’s only weird if it doesn’t work”.
If you don’t know what I’m talking about, watch this ad.
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Well, the Homa family has its own ritual when rooting for our favorites … the Monsters of the Midway … the Chicago Bears.
Some loyal readers have asked why HomaFiles has been light on America’s Got Talent reviews this year.
Well, to be blunt, I thought it was an awful season.
That’s bold revelation since I’ve been defending the show to family and friends for a couple of years.
The judges passed through a barrage of horrible acts … including one that consisted of a group of guys playing a fat man’s belly like a drum.
Gimme a break,
I boycotted the show for a couple of weeks, but got siren-called back for the last couple of rounds.
This week was the grand finale.
Here’s the good news: the best performer in the competition – by far – won the million bucks.
Here’s the rub …
Yesterday, the stock market soared when Bernanke announced the continuation of the Fed’s Quantitative Easing program … that is, the Fed plans to continue pumping $85 billion dollars per month into the economy.
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So, why did the market reach record highs?
Easy.
Let’s start by taking a stroll down memory lane ….
McKinsey recently published a report “Big Data – The Next Frontier” that concludes:
The United States faces a shortage of 140,000 to 190,000 people with deep analytical skills as well as 1.5 million managers and analysts to make decisions based on their findings.
Crunch those nums …
Just finished a book called A whole New Mind: Why Right Brainers Will Rule the World.
As a hard core left-brainer, I figured I’d better pay attention to this one.
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Here’s the crux of the book …
The last few decades have belonged to a certain kind of person with a certain kind of mind — computer programmers who could crank code, lawyers who could craft contracts, MBAs who could crunch numbers.
But, the future belongs to a very different kind of person with a very different kind of mind — creators and empathizers, pattern recognizers, and meaning makers.
We are moving from an economy and a society built on the logical, linear, computerlike capabilities of the Information Age …
… to an economy and a society built on the inventive, empathic, big-picture capabilities of what’s rising in its place, the Conceptual Age.
Why the shift?
Because any kind of work that be reduced to repeatable rules and defined processes can be automated or shipped off-shore – even so-called knowledge work
Survival in the Conceptual Age requires thinking skills utilizing the right-side of the brain.
Specifically, “high concept” involves the capacity to:
- detect patterns and opportunities
- create artistic and emotional beauty
- craft a satisfying narrative
…. and to combine seemingly unrelated ideas into something new and distinctive.
Amazon link
What’s required to to succeed in Conceptual Age?
Right when you think trust in government has bottomed out, Gallup releases a new poll.
Gallup is reporting Less than half of Americans trust the government to handle any kind of problems, anall-time low..
According to Gallup. just 49% of Americans have a great deal or fair amount of confidence in the federal government to handle international problems
The previous low was 51 percent in 2007.
And, that’s the good news.
Trust is even lower on domestic issues.
HITS: HomaFiles’s Ideas To Share
For decades cognitive psychologists has characterized folks as being either left brain dominant – logical – or right brain dominant – creative.
Browse the lists below and pick your dominant brain side – left or right.
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So what? What to do?
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I was a bit surprised to hear on the news that Citi was laying off a couple of thousand folks in their mortgage division.
After all, there’s been lot of talk re: housing recovery … with some markets el fuego.
Hmmm.
Turns out that mortgage applications bottomed out after the meltdown …and arguably showed some up-trend in the past couple of years (thanks to the Fed QE program),
But, mortgage apps have declined recently (as interest rates started moving up a bit) and are hovering at very low levels
What about home prices?
Yesterday I gave a pitch that touched on whether quants (left-brainers) or poets (right-brainers) were on the rise.
Reminded me of a cool 15 minute TED Talk.
Tech entrepreneur Kevin Slavin tells how algorithms have reached across industries and into every day life.
A couple of lines caught my attention:
Obviously, Slavin comes down on the side of the quants.
Worth listening to this pitch … a very engaging geek who may be onto something big.
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McKinsey does a relatively good job of staying out of the press.
But, a book called “The Firm: The Story of McKinsey and Its Secret Influence on American Business,” is being released today that may stir the pot a bit.
Early reviews indicate that the book dishes some serious smack at my former employer.
Here are some of the lowlights …
The Feds reported that the unemployment rate dropped to 7.3% … despite tepid job growth – fewer jobs added than expected, and those that were added were in retail & hospitality.
Most analysts quickly pointed out that the unemployment rate dropped because the number of people dropping out of the labor force was about twice the number of jobs added.
In technical jargon, the labor force participation rate dropped to a 35 year low.
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A complementary metric that combines the effect of the Unemployment Rate and the Labor Force Participation Rate is the Civilian Employment to Population Ratio – the percentage of the working age population that has a job.
That rate dropped about 4 percentage points during the recession … then has flatlined during the “recovery”.
That is, job growth has barely kept up with population growth.
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What about my favorite? The downmixing to more part time positions?
Here are some data points in advance of this morning’s BLS Employment Report.
Gallup’s daily tracking report indicated a surge in the unemployment rate … averaging 8.5% … getting as high as 8.8% during the month.
Source: Gallup
More data …
First, the disclaimers:
1) I don’t give investment advice.
2) I think Jim Cramer is a blowhard.
But …
Last week, a friend of mine who seems to have a touch reading the market alerted me that he was moving strongly towards cash … away from stocks … and far away from bonds.
Hmmm.
Cramer must have been listening in.
Here are Cramer’s 7 reasons to move to cash …
I bought a new “smart” TV … and it came with a 6-month free subscription to Netflix steaming service.
Sweet.
In concept, the streaming concept is a cool idea, except for:
#3 surprised me since Netflix have invested heavily in systems to figure out what we want to to see.
Here’s what’s going on and what Netflix is doing about it …
Yesterday, we posted some recent ASCI Customer Satisfaction survey results.
Headline was that overall customer satisfaction numbers have been steadily increasing.
Minor surprise was that autos sorted relatively high on the list.
But, there’s more to the story.
Remember Harry Truman’s desk sign that read “The Buck Stops Here”?
Well, it sprang to mind when I read a Washington Post article title: “U.S. Facing Test on Data to Back Action on Syria.
What’s that got to do with Harry Truman?
Here’s what caught my eye …
It has been a couple of years since I glanced at ASCI Customer Satisfaction numbers.
And, I was a bit surprised by the numbers …
During the 1990s, there was a pronounced drop in customer satisfaction … aggregated across all categories of products.
But since 1997, there has been a steady improvement … reaching new historic highs.
Here are the details by product category …
Recent polls have indicated that there is very low public support for military action against Syria.
Gallup says that 68% of Americans say the United States should not use military action in Syria to attempt to end the civil war there.
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Ditto a Reuters/Ipsos poll that says “Americans strongly oppose U.S. intervention in Syria’s civil war and believe Washington should stay out of the conflict even if reports that Syria’s government used deadly chemicals to attack civilians are confirmed,”
More specifically, “about 60 percent of Americans surveyed said the United States should not intervene in Syria’s civil war, while just 9 percent thought military action should be taken.”
A historical context puts an interesting paint job on these numbers …
According to the latest research, IQ accounts for what portion of career success?
a. 50 to 60 percent
b. 35 to 45 percent
c. 23 to 29 percent
d. 15 to 20 percent
The answer …
You may remember that the BLS reported tha, for July, the unemployment rate continued its decline … all the way down to 7.4%.
Good news. right.
Not so fast …
A real-world colleague of mine used to ask “Where do old marketing people go? I never see any around …”
Hmmm.
Now, Bloomberg has broken the code and I can answer my former colleague:
“They go into teaching … and stay there.”
Now, it’s getting real personal.
A survey commissioned by Fidelity (who the heck knows why) reported in the journal Inside Higher Ed found that “some 74 percent of professors aged 49-67 plan to delay retirement past age 65 or never retire at all.” Never retire at all?
Here’s what’s going on …
Answer: Real valuable.
Perennial question for Ivy-aimed high-schoolers is “which is better an A in a regular course or B in an AP course?”
Admission officers always say “Take the AP course and get an A in it”.
Easier said than done sometimes.
Fast forward to college and b-school admissions.
If you want to get into a highly ranked b-school, Is it better to get average grades in hard courses at an academically challenging college …. or high grades in easier courses at an easier or grade-inflated school?
Here’s the answer …
Excerpted from the WSJ …
Casinos have developed detailed behavioral profiles of many of their customers, based in part on information gathered though loyalty-card programs that can track slot-machine play and other-gambling activity.
The casinos use this information to tailor marketing offerings, particularly to the small minority who make up the bulk of their revenue base.
It’s called predictive analytics, and casinos have been on the leading edge.
Here’s the rub …
If you’ve been shrugging off the government spying and control stuff, watch this short video-simulation.
It’s getting personal …
Thanks to ST for feeding the lead …
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Consider this …
In March, Netflix shipped its 4 billionth DVD.
In the first quarter of 2013 alone, it streamed more than 4 billion hours.
The company estimates that 75 percent of viewer activity is driven by the company’s algorithmic recommendation.
Here’s some skinny on how Netflix works the numbers …
The Daily Mail reports that scientists have discovered that sleep deprivation increases cravings for junk food:
Here’s the skinny on the study…
While most people tend to think that they have one credit score, there are actually many different types of scores.
Here are some specifics …
The Homa Files 