WOOSTER TWP. — Name the ailment and Riley Freeland had it Saturday afternoon — upset stomach, body aches and even a headache.
My Iowa post last week got a whole lot more attention than I thought it would have and provoked several great conversations. One of the questions was about how to deal with this extreme corner case and if a high cost risk pool made sense for this use case. This is the perfect example for a high cost pool.
And then there was a great discussion on how to design such a program. And this leads to a discussion about clustering. Bigger risk pools are more efficient and effective at spreading risks, so we’re going to talk about clustering for a bit.
@onceuponA @matthewherper @afrakt @aaronecarroll @larry_levitt @ASlavitt @LorenAdler Ideally national pooling not 51 state pools as random clustering would be ugly for small state much less non-random cluster of doom
— David Anderson (@bjdickmayhew) April 21, 2017
Let’s imagine a hypothetical high cost risk pool of the top 1,000 individual claim years in the country. The average claim will be $5,000,000 for the year. Let’s simplify things and say 990 are randomly distributed by population and 10 are a non-random cluster that we can insert into any state at any time. The first run through is with fifty one state (and DC) based high cost risk pools. We’ll look at two states, California and Wyoming, for this run.
California has about 10% of the population. California should expect to see 99 people in this hypothetical pool plus an expectation that one of the ten non-random people would be expected to be in California. Their expected high cost risk pool budget is $500 million. Now if all ten of the non-randomly clustered people are in California, they increase the expected pool costs by 9%. California is big enough and rich enough that a surprise $45 million dollar medical expense does not destroy their budget.
Now Wyoming should expect to see between 1 and 2 people qualify for the high cost risk pool. Let’s assume the Wyoming state government is very cautious and they allocate $10 million for the high cost risk pool. That works great in a normal year. But if the travelling roadshow of catastrophic medical expenses arrive in Cheyenne, the state is now on the hook for twelve qualified individuals. They are 500% over budget now and the state budget is underwater.
This thought experiment is amazingly unrealistic.
Even if we are to assume that extreme medical cost cases are randomly distributed, we should expect several states to be surprised at the number and expense that they face as Pennylsvania could reasonably expect to see anywhere from 45 to 51 qualifying individuals from the scenario above in any given year just do to random chance.
More importantly, we know that diseases are not randomly distributed. My ongoing freak-out about Zika is based on the fact that this is a concentration of very high need and high cost individuals on states with low Medicaid funding. Genetic disorders are tightly clustered due to both the combination of most people live near their families rather than being randomly distributed and localized clusters of diseases have led to local medical-industrial clusters of medical knowledge and treatment. For instance, maple syrup urine disease is a common genetic disorder among Amish families, so there is a good deal of knowledge on treating that disease clustered in Lancaster County, Pennyslvania and Holmes County, Ohio. Sickle cell disorders are overwhelmingly a disease of African Americans, so it is more common in Mississippi than Montana.
From a financial perspective, there is a chance that there is enough sample size that although one state will have more of one genetic disorder it washes out as another disorder it is light in is dis-proportionally prevalent in another state so the cash flows balance out. That is an empirical question that I don’t know enough to answer. But even if genetic disorders balance out, localized outbreaks like Zika won’t balance out.
State based high cost risk pools would remove some of the falling knife incentives that I described in Iowa but they will be underfunded and overwhelmed at times of high need. National level pooling is far more efficient and effective.
Hope isn’t necessarily lost if the Browns don’t take a quarterback near the top of the NFL Draft this week. Teams have had success finding franchise quarterbacks later in the draft lately, with Seattle’s third-round pick of Russell Wilson in 2012, Oakland’s second-round selection of Derek Carr in 2014 and Dallas’ fourth-round choice of Dak Prescott last year as prime examples.
Cavs 106, Pacers 102: Cleveland completes not-so-clean sweep as LeBron James hits huge 3-pointer, wins 21st straight in 1st round
INDIANAPOLIS — LeBron James stuck to the old script Sunday.
CHICAGO — The Indians finally gave up a run on the final day of a three-game series.
— Sari Rautiainen (@SariRautiainen) April 22, 2017
Chaz Danner, NYMag, “Scientists and Their Allies Stage Unprecedented Worldwide Protest“:
Scientists and their supporters amassed in large numbers in hundreds of cities across the globe on Saturday to participate in the March for Science, a worldwide protest in support of science, scientists, and the value of scientific research. More officially, the nonpartisan event was meant to encourage “political leaders and policymakers to enact evidence-based policies in the public interest.” Many attendees in the U.S., however, appeared to be motivated as much by their respect for science as they were by the Trump administration’s perceived antipathy towards it. The sweeping White House-proposed budget cuts to federal agencies that fund scientists and their research was instrumental in driving interest in the march over the last few months, and government science budgets were clearly on the mind of many other marchers across the world too, as was the threat of human-driven climate change. Evidence and reality may be neutral, but in the present political climate, scientists may no longer be able to be so.
Whatever the specific motivations of individual participants, the overall march was undoubtedly a unique event in the history of science and politics. As the Washington Post’s Chris Mooney explains after talking to some science historians, “While scientists and their allies have argued about and even occasionally protested on specific political topics over the years, taking to the streets in a sweeping defense of scientific truth itself and its role in policymaking seems considerably broader and, for the research world, more fundamental.”…
Apart from continued #Resistance, what’s on the agenda as we start another week?
— Sarah Reese Jones (@PoliticusSarah) April 22, 2017
— The New York Times (@nytimes) April 22, 2017
Good Morning All,
This weekday feature is for Balloon Juicers who are on the road, travelling, etc. and wish to share notes, links, pictures, stories, etc. from their escapades. As the US mainland begins the end of the Earth day as we measure it, many of us rise to read about our friends and their transient locales.
So, please, speak up and share some of your adventures, observations, and sights as you explore, no matter where you are. By concentrating travel updates here, it’s easier for all to keep up-to-date on the adventures of our fellow Commentariat. And it makes finding some travel tips or ideas from 6 months ago so much easier to find…
Have at ’em, and have a safe day of travels!
Should you have any pictures (tasteful, relevant, etc….) you can email them to email@example.com or just use this nifty link to start an email: Start an Email to send a Picture to Post on Balloon Juice
Since some tech issues affected Friday’s post and many readers were affected, this is a re-run, with the sliders removed. New pictures Tuesday!
FYI I’m investigating different sliders that work in both the desktop and mobile site without lots of impact on the site, etc. I’ll keep you informed!
First up, from Mike Ryan:
On April 12th we visited Maui’s Ho’okipa Beach, famed as one of the best windsurfing locations. The big surf and high winds were being utilized by scores of wave riders. It was fun to watch the surfers launch their boards into the waves.
Please, let me know in the comments what you think of the slider and I’ll experiment so more.
Next up, from Carol Ryan (must be related, given the name and location!)
Where it was taken: Maui
When: March 31,2017
Other notes or info about the picture: This was taken at the top of the tallest peak of Haleakalā (“house of the sun”), at 10,023 feet.
The plant is a silversword, only found at the summit, very rare. There is a high altitude observatory at the top, the first astronomical research observatory in Hawaii. I also included two pictures of Homer’s Grove (an experimental forestation project) in the fog, which was on the way to the summit.
Sorry for the mixed up text-to-pics order.
I realize that there’s one duplicate from a previous day but it’s part of the set!
And to wrap up the week, from JRinWV:
Swans at Yorktown, VA
These were swimming when we drove by visiting Williamsburg and Yorktown with friends not too long ago. Really lucky, shot from the car, sunshine right, everything perfect right out the window. I was just as glad to not get out of the car, Swans are notoriously aggressive and can to a lot of damage in no time. Taken with Panasonic Lumix FZ200 F2.8 24-600mm lens in 2013.
Have a glorious day everyone!
Read more of this story at Slashdot.