How to Deliver Lower-Cost Health Care--With Better Results

Fareed Zakaria, Time:

When listening to the debate about American health care, I find that many of the most fervent critics of government involvement argue almost entirely from abstract theoretical propositions about free markets. One can and should reason from principles. But one must also reason from reality, from facts on the ground. And the fact is that about 20 foreign countries provide health care for their citizens in some way or other. All of them--including free-market havens like Switzerland and Taiwan--have found that they need to use an insurance or government-sponsored model. All of them provide universal health care at much, much lower costs than we do and with better results. 

---Health Insurance Is for Everyone," by Fareed Zakaria, Time (3.26.2012)

Mr. Zakaria, in his focused, pragmatic approach, offers more examples and data points to the body of evidence that more overwhelmingly than ever supports universal health insurance as the only defensible, accountable direction a country can take to create a new system or reform a dysfunctional one like ours. In this case, he focuses on two other free-market economies, Switzerland and Taiwan, one that has worked within a market model with notable success, and one that, like many other countries, has achieved even more success under a single-payer government insurance program. So, let's read some of what Mr. Zakaria has to share with us about the two approaches:

The centerpiece of the case against Obamacare is the requirement that everyone buy some kind of health insurance or face stiff penalties--the so-called individual mandate. It is a way of moving toward universal coverage without a government-run or single-payer system. It might surprise Americans to learn that another advanced industrial country, one with a totally private health care system, made precisely the same choice nearly 20 years ago: Switzerland. The lessons from Switzerland and other countries can't resolve the constitutional issues, but they suggest the inevitability of some version of Obamacare. 

Switzerland is not your typical European welfare-state society. It is extremely business-friendly and has always gone its own way, shunning the euro and charting its own course on health care. The country ranks higher than the U.S. on the Heritage Foundation's Index of Economic Freedom. 

Twenty years ago, Switzerland had a system very similar to America's--private insurers, private providers--with very similar problems. People didn't buy insurance but ended up in emergency rooms, insurers screened out people with pre-existing conditions, and costs were rising fast. The country came to the conclusion that to make health care work, everyone had to buy insurance.  

So the Swiss passed an individual mandate and reformed their system along lines very similar to Obamacare. The reform law passed by referendum, narrowly. The result two decades later: quality of care remains very high, everyone has access, and costs have moderated. Switzerland spends 11% of its GDP on health care, compared with 17% in the U.S. Its 8 million people have health care that is not tied to their employers, they can choose among many plans, and they can switch plans every year. Overall satisfaction with the system is high. 

[...] When Taiwan--another country with a strong free-market economy--decided to create a new health care system in the mid-1990s, it studied every existing model. It too chose a model of universal access and universal insurance but decided against having several private insurers, as Switzerland and the U.S. do. Instead it created a single insurer, basically a version of Medicare. The result: universal access and high-quality care at stunningly low costs. Taiwan spends only 7% of its GDP on health care [vs. 11% in Switzerland and 17% in the US].

Unsurprisingly, the data and experience of these two countries also support the importance of universal health insurance and universal participation. And while it indicates we should expect Obamacare to offer Americans better health care at lower cost, it also indicates that a government single-payer approach to national health insurance will provide the best health care to all at the lowest cost. This is consistent with what I and others have written about the uniques dynamics of delivering "public goods" equitably to all people. But given the political climate in the US, it is clear that the Obamacare model is a necessary stepping stone to the more efficient govermment-payer model.

But the question always remains, Has enough of a sense of national humility found it's way into our national identity, enough to temper our reflexive and brittle national hubris?  Is it now possible we could be open-minded enough to learn something from Switzerland and Taiwan--and England, France, Canada, Japan and other countries, too?  And especially with so many US financial and political interests marketing misinformation to protect their status quo? Progress will likely continue to be made, but only in slowly evolving stages, it seems. It is the American way.

Link:

http://www.time.com/time/magazine/article/0,9171,2109128,00.html
 

Fareed Zakaria: A Case for Better Gun Regulation

So when people throw up their hands and say we can't do anything about guns, tell them they're being un-American--and unintelligent. 

---"The Case for Gun Control: Why limiting easy access to guns is intelligent and American," by Fareed Zakaria, Time (8.20.2012)

I am a fan of Fareed Zakaria. He brings a fresh, global, and multicultural perspective--a well-schooled, researched and thoughtful perspective--to whatever topic he is addressing. He so often gives us a more insightful way of seeing a problem or solution. More, he almost always leaves us better informed and appropriately challenged by reading what he has to say. And that is no less true because he recently admitted to using some material from another writer without proper attribution. He has offered his mea culpa and apologies, and I, for one, accept them, and think it unlikely to happen again. He is just too important a voice not to forgive his unfortunate journalistic faux pas, and quickly restore his balanced commentary to the pages of Time.

But the subject is gun control and regulation. And Mr. Zakaria ably takes us on an efficient tour of recent mass homicides with firearms, the issues involved, the history, the constitution, and what is both wise and possible--even if some information is not properly cited. I really have little more to say that he doesn't say better. These excerpts from his Time article:

Gun violence in America is off the chart compared with every other country on the planet. The gun-homicide rate per capita in the U.S. is 30 times that of Britain and Australia, 10 times that of India and four times that of Switzerland. When confronted with such a large deviation, a scholar would ask, Does America have some potential cause for this that is also off the chart? I doubt that anyone seriously thinks we have 30 times as many crazy people as Britain or Australia. But we do have many, many more guns. 

[...] The effect of the increasing ease with which Americans can buy ever more deadly weapons is also obvious. Over the past few decades, crime has been declining, except in one category...firearm homicides. What can explain this anomaly except easier access to guns? ...Confronted with this blindingly obvious causal connection, otherwise intelligent people close their eyes.  

[...] Adam Winkler, a professor of constitutional law at UCLA, documents the actual history in Gunfight: The Battle over the Right to Bear Arms in America. Guns were regulated in the U.S. from the earliest years of the Republic. Laws that banned the carrying of concealed weapons were passed in Kentucky and Louisiana in 1813. Other states soon followed: Indiana in 1820, Tennessee and Virginia in 1838, Alabama in 1839 and Ohio in 1859. Similar laws were passed in Texas, Florida and Oklahoma. As the governor of Texas (Texas!) explained in 1893, the "mission of the concealed deadly weapon is murder. To check it is the duty of every self-respecting, law-abiding man." 

Congress passed the first set of federal laws regulating, licensing and taxing guns in 1934. The act was challenged and went to the U.S. Supreme Court in 1939. Franklin Delano Roosevelt's solicitor general, Robert H. Jackson, said the Second Amendment grants people a right that "is not one which may be utilized for private purposes but only one which exists where the arms are borne in the militia or some other military organization provided for by law and intended for the protection of the state." The court agreed unanimously. 

Things started to change in the 1970s as various right-wing groups coalesced to challenge gun control, overturning laws in state legislatures, Congress and the courts. But Chief Justice Warren Burger, a conservative appointed by Richard Nixon, described the new interpretation of the Second Amendment in an interview after his tenure as "one of the greatest pieces of fraud--I repeat the word fraud--on the American public by special-interest groups that I have ever seen in my lifetime."

But just to be clear: I'm very comfortable with registered firearms for hunting and sporting pursuits. I was reared in a family of wing-shooters (bird hunters). Growing up, German short-haired pointers, English setters and shotguns were a Sunday afternoon ritual with generations of men in my family. (Although guns were broken down at all other times, and ammunition was stored in different places than guns.) And I can also live with reasonable, approriate weapons for self protection, I guess--if someone is so insecure and uninformed about the dangers of intruders that they feel they must have them. (All the research shows that handguns result in far more household injuries and deaths of innocents than anything else). But I got the family gene for fly-fishing, not hunting, so I don't even own a shotgun. And I am completely convinced that nothing good or actually self-protecting will come of keeping a firearm in my home, not a handgun or rifle--and certainly not an automatic weapon.

 

(And in addition to shotguns, I am not unfamiliar or timid with rifles, handguns, and other weaponry, having spent six years in the Marine Corps where I consistently qualified as expert with the rifle and 45 pistol. And yes, I can get a rush from a powerful weapon as much as the next guy.)

 

But for all the years I have considered these issues and questions, for all my understanding and support of responsible sportsmen, I cannot and likely will never understand why some people have problems with firearms registration and their regulation for public safety. And I don't even know what to say about those who believe they need high-powered automatic weapons, and need to keep them in their homes or on their private premises. That is what I call a threat to public safety. The very fact that they are out there in private hands makes me feel more at risk--and I have good reason to feel that way. I continually read of one depressed, deluded or deranged person after another wading into crowds of people firing automatic weapons. And I do not feel any safer because I too can buy an AK-47 and keep it under my bed or in my closet.

 

 

Link:

http://www.time.com/time/magazine/article/0,9171,2121660,00.html  

 

Thomas Friedman: We Need a 'Conservative' Party

Thomas Friedman, three-time Pulitzer Prize winner and columnist for the NYT, has often offered us more insightful thinking about global, economic, political and societal issues than other sources. Most of us know him best for his best-seller on globalization, The World is Flat.

But in this piece from the Op-Ed pages of the NYT, he takes on the elephant in the room: the radicalization of the Republican Party. He does not shrink from the realities, that GOP leaders will brook no disagreement or compromise, either among themselves or with the Democrats. And they would rather see important roles and functions of government fail than raise taxes, even when taxes are at their lowest rates in memory. Of course, the true ideological agenda is to reduce taxes for the very purpose of "starving" government to cripple or, better still, eliminate those government roles and functions. And the severe economic and societal consequences that necessarily must result are apparently all right with them, too. They appear much more at home with 19th-century American society and economics. The only problem is that it's the 21st century.

(Of course, Social Security, Medicare, and Medicaid must be reformed to more cost-efficiently serve well those who are actually in need. And public education reform is long overdo. But reform and cost-efficiency is what's called for, not crippling or privatizing social programs that can only be carried out effectively when treated and administered as public goods. )

Mr. Friedman calls for a return of the Republican Party and it's leadership to a responsible conservatism, a more center-right posture where it's leadership used to be, where reasonable compromises can be made, where progress on critical issues can move forward, where government and its leadership can again function properly.

From Mr. Friedman:

There has been lots of talk that Paul Ryan's nomination ensures that we'll now have a "real" debate about the role of government... And even if Ryan's entry does spark a meaningful debate about one of the great issues facing America — the nexus of debt, taxes and entitlements — there is little sign that we'll seriously debate our other three major challenges: how to generate growth and upgrade the skills of every American in an age when the merger of globalization and the information technology revolution means every good job requires more education; how to meet our energy and climate challenges; and how to create an immigration policy that will treat those who are here illegally humanely, while opening America to the world's most talented immigrants, whom we need to remain the world's most innovative economy.  

But what's even more troubling is that we need more than debates. That's all we've been having. We need deals on all four issues as soon as this election is over, and I just don't see that happening unless "conservatives" retake the Republican Party from the "radicals" — that is, the Tea Party base. America today desperately needs a serious, thoughtful, credible 21st-century "conservative" opposition to President Obama, and we don't have that, even though the voices are out there.  

Imagine if the G.O.P.'s position on debt was set by Senator Tom Coburn, the Oklahoma Republican who has challenged the no-tax lunacy of Grover Norquist and served on the Simpson-Bowles commission and voted for its final plan (unlike Ryan). That plan included both increased tax revenues and spending cuts as the only way to fix our long-term fiscal imbalances... True conservatives know that both Ronald Reagan and George H.W. Bush used both tax revenue and spending cuts to fix budget shortfalls.  

[...] Imagine if the G.O.P.'s position on immigration followed the lead of Mayor Michael Bloomberg and Rupert Murdoch, chief executive of the News Corporation. Bloomberg and Murdoch recently took to the road to make the economic case for immigration reform...The Times quoted the Australian-born Murdoch, who's now a naturalized American, "Right now, if we get qualified people in, there shouldn't be any nonsense about it." Regarding the "so-called illegal Mexicans," Murdoch added, "give them a path to citizenship. They pay taxes; they are hard-working people. Why Mitt Romney doesn't do it, I have no idea, because they are natural Republicans."  

Imagine if the G.O.P. position on energy and climate was set by Bob Inglis, a former South Carolina Republican congressman (who was defeated by the Tea Party in 2010). He now runs George Mason University's Energy and Enterprise Initiative, which is based on the notion that climate change is real, and that the best way to deal with it and our broader energy challenge is with conservative "market-based solutions" that say to the fossil fuel and wind, solar and nuclear industries: "Be accountable for all of your costs," including the carbon and pollution you put in the air, and then we'll "let the markets work" and see who wins. 

Imagine if G.O.P. education policy was set by former Gov. Jeb Bush of Florida, without having to cater to radicals, who call for eliminating the Department of Education and view common core standards as some kind of communist conspiracy. Mr. Bush has argued that a conservative approach to education for 21st-century jobs would embrace more effective teacher evaluation and common core standards, but add a bigger element of choice in the form of charter schools and vouchers, the removal of union rules that limit new technology — and combine it all with greater autonomy and accountability for individual principals. When parents can choose and school leaders can innovate, good things happen.  

We are not going to make any progress on our biggest problems without a compromise between the center-right and center-left. But, for that, we need the center-right conservatives, not the radicals, to be running the G.O.P., as well as the center-left in the Democratic Party. Over the course of his presidency, Obama has proposed center-left solutions to all four of these challenges. I wish he had pushed some in a bigger, consistent, more daring and more forceful manner — and made them the centerpiece of his campaign. Nevertheless, if the G.O.P. were in a different place, either a second-term Obama or a first-term Romney would have a real chance at making progress on all four. As things stand now, though, there is little hope this campaign will give the winner any basis for governing. Too bad — a presidential campaign is a terrible thing to waste.  

---"We Need a 'Conservative' Party," by Thomas L. Friedman, The New Your Times, Op-Ed Page (8.21.2012)

  Imagine. Yes, we can imagie. But that may be as close as we can now get to the classically center-right conservative GOP leadership we need to work with center-left Democrats to restore the ability of congress to govern. 

Link:

http://www.nytimes.com/2012/08/22/opinion/friedman-we-need-a-conservative-party.html?_r=1&smid=fb-share
 

West Coast Accreditor Raises Bar on For-Profits, Community Colleges, and Elite Universities Alike

The scattered, uncoordinated, and uneven patch-work quilt that is higher education accreditation has outlived its usefulness. It no longer has the ability to meet the needs of a large and growing, more diverse and demanding higher education environment--and hasn't for a lpng time. And now the constituencies and customers of higher education, the students, public and the government, are in clear need of a more comprehensive, standardized system that measures and reports how effectively it actually educates its various student populations. The time has come, and yes, it doubtless must fall to the government, federal or state, to administer or oversee it.

But it will take some time to generate consensus among higher education institutions, their constituencies and the government. As we will see, the most prestigious of schools want no part of such a a change, nor do most others. But there is at least one regional accreditor which is getting out ahead of the curve, one which is taking on the charter of moving the existing accreditation process in that new direction.

From The Chronicle of Higher Education:

Too often, accreditors react to criticism with a defensive crouch. So it's been gratifying to watch one regional accreditor, the Western Association of Schools and Colleges, or WASC, take a different approach in recent weeks, setting an example for others to follow. 

WASC oversees higher education in California, Hawaii, and the Pacific islands. In early July it rejected an application from the high-flying publicly traded company Bridgepoint Education. Although Bridgepoint's corporate headquarters are in a downtown San Diego office tower, the anchor of its fast-growing online operation, Ashford University, is in Clinton, Iowa, at the former home of Franciscan University of the Prairies. 

[...] Seven years, more than 200,000 students, vast sums of taxpayer-supported financial aid, and several Congressional hearings later, Bridgepoint had apparently worn out its welcome with Franciscan's former accreditor, and decided to look for approval closer to its corporate home. But WASC turned it down, for reasons that included a paucity of faculty at Ashford and the fact that 128,000 out of 240,000 students had dropped out over the last five years. "That level of attrition," said WASC's president, Ralph A. Wolff, "is, on its face, not acceptable." 

WASC did something else that day which received much less publicity but was, in the long run, probably more important: It posted its rejection letter to Bridgepoint on the Internet for the world to see.  

WASC has also swum into the politically treacherous waters of judging colleges based on whether students graduate and how much they learn. Most colleges gather little or no information about success rates among the profitable and growing adult-student population. WASC will soon require detailed information about the success of nontraditional students. 

More controversially, WASC is asking four-year colleges and universities to provide some evidence of how much their students are learning, and to compare that success to similar institutions. This is just common sense.  

[...] Yet WASC's proposal has met with fierce opposition from the region's elite research universities, including Stanford and the University of California. This is unsurprising, if depressing... The richest, most famous, most exclusive institutions with the most Nobel Prize winners on the faculty are presumed to offer the highest-quality undergraduate education. It's not true, but there's a lot of money and power tied up in the fiction that it is.  

[...] Elite universities have an enormous capacity to set tone and precedent in higher education, as Stanford and others have done recently, to their credit, in legitimizing low-cost online courses. If high-profile institutions embraced the idea of being accountable and transparent for student learning, others would follow. By rejecting such accountability, Stanford and universities like it are helping to perpetuate a system in which far too many college students receive a substandard education. 

---"Why One Accreditor Deserves Some Credit. Really." by Kevin Carey, The Chronicle of Higher Education (7.30.2012)

I wish I had something profound or useful to add to this article. But it really says it all. As it also notes, accreditors have origins and a long history that stressed a "voluntary, peer-based approach [which] made sense in an era when higher education was a smaller, more private affair." But from the period following WWII until today, the expansion and increasing complexity of public and private nonprofit higher education--and now, for-profit higher education--has been driven by increasing public demand by more diverse student populations with increasing reliance on government educational loans to finance them. And the accreditation process has had to scramble to expand and become more sophisticated and relevant in the process. As noted, the assessment of it's success today has varied, but with increasing criticism about the relvance of its charter and ability to carry it out. 

Can existing regional higher education accreditors evolve enough--and quickly enough--to meet today's and tomorrow's accreditation needs? Can they bring more standardization to broader measures and processes?  Can they remove the sensed need to look to the government to assume or oversee this role? Perhaps. But as encouraging as this stance by the WASC is, it is just an isolated ray of hope in this mired and dispiriting business. And the expected failure of many other accreditors to follow suit will just make more clear the need for government standardization and oversight, and the lack of any effective alternative.

Link:

http://chronicle.com/article/Why-One-Accreditor-Deserves/133179/

For-Profit Hospital Chain Performs Unnecessary Cardiac Work

From The New York Times:

In the summer of 2010, a troubling letter reached the chief ethics officer of the hospital giant HCA, written by a former nurse at one of the company's hospitals in Florida...[T]he Lawnwood Regional Medical Center, in the small coastal city of Fort Pierce, had been performing heart procedures on patients who did not need them, putting their lives at risk.   

HCA, the largest for-profit hospital chain in the United States with 163 facilities, had uncovered evidence as far back as 2002 and as recently as late 2010 showing that some cardiologists at several of its hospitals in Florida were unable to justify many of the procedures they were performing.  

Those hospitals included the Cedars Medical Center in Miami, which the company no longer owns, and the Regional Medical Center Bayonet Point. In some cases, the doctors made misleading statements in medical records that made it appear the procedures were necessary, according to internal reports.   

At Lawnwood, where an invasive diagnostic test known as a cardiac catheterization is performed, about half the procedures, or 1,200, were determined to have been done on patients without significant heart disease, according to a confidential 2010 review. HCA countered recently with a different analysis, saying the percentage of patients without disease was much lower and in keeping with national averages... 

On Monday morning, in a conference call with investors, company executives disclosed that in July the civil division of the United States attorney's office in Miami requested information on reviews assessing the medical necessity of interventional cardiology services provided at 10 of its hospitals, located largely in Florida, but also two or three hospitals in other states. In the conference call and in a statement on its Web site, the company also referred to inquiries by The Times. HCA's stock ended nearly 4 percent lower Monday, at $25.55.   

In a recent statement, HCA declined to provide evidence that it had alerted Medicare, state Medicaid or private insurers of its findings, or reimbursed them for any of the procedures that the company later deemed unnecessary, as required by law...HCA also declined to show that it had ever notified patients, who might have been entitled to compensation from the hospital for any harm.    

---"Hospital Chain Inquiry Cited Unnecessary Cardiac Work," by Reed Abelson and Julie Creswell, The New York Times (8.6.2012)

Because medical insurance, generally, pays doctors and hospitals primarily for office visits and procedures (rather than patient wellness), we can't be surprised that doctors might stress more office visits and procedures--but this is especially true at for-profit hospital chains like HCA. That's just the way the financial incentives work. And too often the result can be patients put at risk rather than protected in their wellness. And it implies tacit approval, or more, by the medical profession and government. Of course, overt approval and public advocacy marks the beneficiaries at every profit point for medical equipment, medications, tests, and skilled medical services--and for medical insurers, too. When it is about income and profit first, you know that whatever the product or service, it will not be treated and delivered as a public good, and in the case of health care services, when there is a conflict of interests, patient wellness will too often come second.

As I use the term, broadly and socially speaking, "public goods" are goods and services necessary or appropriate for the protection, including social protection, and economic strengthening of a state or country. And they are meant to be available equally to all its people. Think national defense and national security, public safety, transportation and travel infrastructure, but also social goods like social welfare programs, education, and, yes, health care. They are deemed important to the welfare and advancement--including economic advancement--of the country as a whole as well as to the individual.

(And yes, health care should be approached as a public good, too. That's what experience makes evident and what most people intuitively understand: better, more affordable, preventative and basic healthcare more broadly strengthens individual health and, in turn, economic productivity and civic contribution. That's also the conclusion of most other industrialized countries.)

So, when the delivery of "public goods" are undertaken with a for-profit model, we cannot be surprised that things go awry. This report about the for-profit hospital chain HCA is just the latest example of how the profit motive distorts public services values and undermines the process of delivering competent, trustworthy, and affordable healthcare to the public (which is delivered as a public good in many other industrialized countries at half our cost).

I've also recently posted about how for-profit higher education is most often delivering a subpar product (or service) at an unaffordable price, a price beyond the means of it's mostly nontraditional students, a price that can only be financed through US government educational loans (i.e., by taxpayers). And the result in most cases is debt without benefit, because it must be borne by the students, most of whom soon drop out of the programs. There's a lot wrong with that picture.

But too many people just don't appreciate this key distinction, this difference, that inheres in public goods--or they don't want to. Markets, by definition, discriminate between customers based on quality and abilty to pay for the product or service. That means some get a product of inferior quality, and some get less of it or none at all. For delivery of public goods, profit motive and market mechanisms simply undermine success in meeting the public need and national goal.


Link to NYT article:

http://www.nytimes.com/2012/08/07/business/hospital-chain-internal-reports-found-dubious-cardiac-work.html?_r=1&smid=fb-share

Doonesbury Targets For-Profit Higher Education, Too

Okay, with my recent post about the poor report cards on most of for-profit higher education, I may look like I am piling on here. But these strips are just too good to pass up. Yes, I repeat, some for-profits are performing well, others are improving; but as an industry they are not yet approaching their heralded role and promise in reshaping higher education, either in flexibility of content or delivery systems--and certainly not in affordable cost.

So far, it's been more about short-term profits based almost solely on government financing rather than pioneering in educational content, methodology, and cost reduction. That still may come. It should. But in the meantime, you'll have to forgive me for enjoying the well-deserved mocking of those who would just work the system for short-term profitability at the taxpayers expense, while delivering relatively little value to nontraditional students. Other entertaining strips in this series can be found at the Doonesbury/Slate site.

US Senate, Accreditor, Criticize For-Profit Higher Education. Fair?

The Chronicle of Higher Education:

For-profit colleges can play an important role in educating nontraditional students, but the colleges often operate as aggressive recruiting machines focused on generating shareholder profits at the expense of a quality education for their students. 

That's the unflattering portrait of the for-profit higher-education industry detailed in a voluminous report officially released on Monday by the Senate Health, Education, Labor, and Pensions Committee. The report, which also criticizes the accrediting agencies that evaluate the colleges, concludes a two-year investigation into the operations of 30 for-profit higher-education companies from 2006 to 2010. 

---"Senate Report paints a Damning Portrait of For-Profit Higher Education," by Michael Stratford, The Chronicle of Higher Education (7.31.2012)

The Senate report concludes that most for-profit institutions in higher education--most, not all--place their emphasis on profits over education and graduation of students. Of course, they are in the education business to make profit. But that profit comes from a target population of nontraditional students without financial means. The revenue comes from student loans from the government, most of which goes into marketing, too often high-pressure, "boiler room"-type "marketing"--more, in fact, than goes into educating students!

The Chronicle article appended these revealing summary data:

By the Numbers

• More than half of the 1.1 million students who in 2008-9 were enrolled in colleges owned by the examined companies had withdrawn by mid-2010.
• In 2010 the for-profit colleges examined employed 35,202 recruiters, compared with 3,512 career-services staff and 12,452 support-services staff, which amounts to more than two recruiters for every student-service employee and 10 recruiters for every career-services staff member.
• Colleges owned by a company that is traded on a major stock exchange had 2008-9 withdrawal rates nine percentage points higher than the privately held companies examined. Among the 15 publicly traded companies, 55 percent of students departed without a degree, compared with 46 percent of students at the 15 privately held companies.
• In the 2009 fiscal year, the colleges examined spent:  $4.2-billion (22.7 percent of all revenue) on marketing, advertising, recruiting, and admissions staffing.
$3.6-billion (19.4 percent of all revenue) on profit. $3.2-billion (17.2 percent of all revenue) on instruction.
• 96 percent of students at for-profit colleges take out student loans, compared with 13 percent of community-college students, 48 percent of students at four-year public colleges, and 57 percent of students at four-year private nonprofit colleges.

But to be fair, the report analyzes a sample of only 30 for-profit colleges--by no means all or most--but includes some very recognizable names. They were chosen and their data analyzed to provide a fair representation of the group. And to be fair, the study identifes several for-profit colleges it deems to be doing a good job, and several others that have shown notable improvement. But the fact remains that on the whole, and as a sigificant segment of higher educational institutions, they appear to be well short of national standards for higher education performance.

And then there is the Chronicle story about a regional accreditor, the Western Association of Schools and Colleges (WASC),  and it's rejecting response to the for-profit Ashford College. From the article:

WASC oversees higher education in California, Hawaii, and the Pacific islands. In early July it rejected an application from the high-flying publicly traded company Bridgepoint Education. Although Bridgepoint's corporate headquarters are in a downtown San Diego office tower, the anchor of its fast-growing online operation, Ashford University, is in Clinton, Iowa, at the former home of Franciscan University of the Prairies. 

In 2005 Bridgepoint bought Franciscan, which at the time was declining but still accredited. Franciscan was promptly renamed Ashford.  

Seven years, more than 200,000 students, vast sums of taxpayer-supported financial aid, and several Congressional hearings later, Bridgepoint had apparently worn out its welcome with Franciscan's former accreditor, and decided to look for approval closer to its corporate home. But WASC turned it down, for reasons that included a paucity of faculty at Ashford and the fact that 128,000 out of 240,000 students had dropped out over the last five years. "That level of attrition," said WASC's president, Ralph A. Wolff, "is, on its face, not acceptable."

---"Why One Accreditor Deserves Some Credit. Really." by Kevin Carey, The Chronicle of Higher Education (8.3.2012) 

This article also describes how the WASC posted it's rejection letter on the Internet for all to see. But before you think they are just biased against for-profit schools, consider that the WASC is now challenging public and private nonprofits as well, including "asking four-year colleges and universities to provide some evidence of how much their students are learning, and to compare that success to similar institutions." Now that's even got the elite universities like Stanford and Cal-Berkeley upset. I say, good, it's about time for some top-down accountability that addresses how much learning really takes place--and no schools should be exempt. (More on this in another post.)

But if I appear eager to share this story, let me also hasten to add that I'm both sympathetic and optimistic about the role of for-profit higher education in formulating or re-shaping better higher education options--outcome-effective, cost-effective options--and especially for middle and lower income students and families. I addressed this in a 2011 post, "Disruptive Innovation: Re-Shaping American Higher Education?" But identifying the best and worst among the for-profits and offering interim report cards on the industry as a whole is also an important part of the process.

If for-profits would ultimately provide the needed educational "life raft" for nontraditional and lower-income students and their families, they must come down the learning curve and the cost curve a lot faster than they have. Right now, many or most community colleges offer the same or better educational outcomes for these students at a much lower price.  

Links:

http://chronicle.com/article/Profits-Not-Student-Success/133217/
http://chronicle.com/article/Why-One-Accreditor-Deserves/133179/
http://hydeparkgh.blogspot.com/2011/07/disruptive-innovation-re-shaping.html

"The Gift" (of Hafiz) Keeps Giving

 It's Sunday morning with it's quiet time, reflections and contemplations. And after some favorite Psalms, I was drawn back to another old source of insight and epiphany: The Gift*, a book of poems by Hafiz. As with other favorite books of poetry left unconsulted too long, it offered new understandings from poems I'd always liked, but also from some I'd spent less time with. From The Gift:


The Stairway of Existence

We

Are not

In pursuit of formalities

Or fake religious

Laws,

For through the staircase of existence

We have come to God's

Door.

We are

People who need to love, because

Love is the soul's life,

Love is simply creation's greatest joy.

Through

The staircase of existence,

O, through the staircase of existence, Hafiz,

Have

You now come,

Have all now come to

The Beloved's

Door.

Love is the Funeral Pyre

Love is

The funeral pyre

Where I have laid my living body.

All the false notions of myself

That once caused fear, pain,

Have turned to ash

As I neared God.

What has risen

From the tangled web of thought and sinew

Now shines with jubilation

Through the eyes of angels

And screams from the guts of

Infinite existence

Itself.

Love is the funeral pyre

Where the heart must lay

It's body.

In Need of the Breath

My heart

Is an unset jewel

Upon the tender night

Yearning for it's dear old Friend.

When the Nameless One debuts again

Ten thousand facets of being unfurl wings

And reveal such a radiance inside

I enter a realm divine...

My heart is an unset jewel

upon existence

Waiting for the Friend's touch.

Tonight

My heart is an unset ruby

Offered bowed and weeping to the Sky.

I am dying in these cold hours

For the resplendent glance of God.

I am dying

Because of a divine remembrance

Of who I really am.

Hafiz, tonight,

Your soul

Is a brilliant reed instrument

In need of the breath of

Christ.

The Heart is Right

The

Heart is right to cry

Even when the smallest drop of light,

Of love,

Is taken  away.

Perhaps you may kick, moan, scream

In a dignified

Silence,

But you are so right

To do so in any fashion

Until God returns

To You.

Startled By God

Not like

A lone beautiful bird,

These poems now rise in great white flocks

Against my mind's vast hills

Startled by God

Breaking a branch

When His foot

Touches earth

Near me.


*The Gift, Poems by Hafiz, the Great Sufi Master, as interpreted by Daniel Ladinsky (1999)

Congress Forces Post Office to Lose Money (And Reduce Service?)

The U.S. Postal Service is losing a lot of money. It is true. Some think it has to do with an ineffective, noncompetitive business model. But no so much, not really. It has more to do with a lot less 1st-class mail being sent (because of e-mail), excess infrastructure and capacity (from times when it was needed), and the role of Congress in creating onerous rules that force the Post Office to lose money! That, apparently, is also true. And then there is the plan to downsize to the point of materially reducing postal service to less populated areas. Hmm. From nbcnews.com:

Neither rain, nor heat, nor gloom of night -- nor, apparently, a $5.5 billion default -- will keep the U.S. Postal Service from moving the mail. The agency confirmed Wednesday that it has defaulted on a payment, mandated by Congress, to a health benefit trust fund managed by the Treasury. The agency said it will miss a similar payment due Sept. 30.  

The default will have "no material effect" on its operations, according to a Postal Service spokesman. "We will continue to deliver the mail, pay our employees and suppliers and meet our other financial obligations," the spokesman said. 

The default is a milestone in the long-running political dance between Congress and Postal Service managers over how to finance the delivery of mail to 151 million addresses, nearly 40 percent of the world's "snail mail" volume. Though its Capitol Hill critics complain that Postal Service should be made to operate "more like a business," Congress has created a set of rules that all but guarantee billion-dollar losses. 

---"$5.5 billion Postal Service default won't stop the mail," by John W. Schoen, nbcnews.com (8.1.2012

But how can this be? What kind of Congressional rules are we talking about here? Well, it has largely to do with a requirement that the Postal Service pre-fund retiree health benefits when private businesses are subject to no such requirement. But why should the Postal Service be required to provide retiree health benefits at all? Most private businesses no longer offer such benefits. That's the province of Medicare, or whatever reformed or alternative government medical coverage may replace it. nbcnews.com:

Those losses are almost entirely the result of the now-defaulted "pre-funding" requirement [of Congress] for retiree health insurance and other accounting charges, according to Ron Bloom, an investment adviser at Lazard who has advised the Postal Service on restructuring. "No other company in America, public or private, has that obligation," he said. "The Postal Service is losing about $75 million a month from delivering the mail. That's a problem, but a different problem than the billions we hear about. If we raise the price of a stamp by half a penny, they would be breaking even." 

The Postal Service faces other constraints. It is banned from setting up retail outlets, for example, that could generate profits to help subsidize delivery costs. Worse, it is barred by Congress from charging the full cost of providing the service it is required to deliver. "On the one side, (Congress) says, 'We want to you deliver a letter from the corner of Alaska to the far corner of Hawaii and we want to you do it for 45 cents,' which has nothing to do with the price of what it takes to get there," said Bloom. "On the other hand, (Congress) says, 'We want to you break even.'" 

Beyond the crushing burden of prefunding benefits, the Postal Service is grappling with a long-term decline in the volume of first-class mail -- 4 to 5 percent year -- as more communication shifts to the Internet. It's not unlike a transition in the 1970s, when the decline of railroads forced the Postal Service to develop a new infrastructure of sorting facilities, part of the reason Congress chose to establish the service as an independently funded agency, according to Robert John, a Columbia Journalism School professor who has written about the history of the service. 

"They built these large sorting centers that made it possible to distribute first-class mail in a day or two," he said. "That's one of the ways they could save money. They could no longer use all the facilities that they built out. Do we, as a matter of policy, need to get catalogs, advertising -- so-called junk mail -- in one day? Could we get it in three days? But then what about Social Security checks?"

But there is more to the story than that. The U.S. Postal Service is mandated by the U.S. Constitution--and the Congress has oversight responsibility for it. The availability, access and reliability of an interstate postal service was that important to the founding fathers; it was one of the first defined and required public goods.

Why is that important? Well, there is a plan to "right size" the Postal Service so that it will be profitable, but it apparently requires materially reducing postal service in less populated areas. Of course, at the time of the drafting of the U.S. Constitution, there were more sparsely populated and rural areas than anything else. But, within available means, they were to be served as well. And so we shouldn't be surprised that Congressmen representing those rural areas today have objected to a contraction of mail delivery services to their constituents. And so the stalemate stands. More from nbcnews.com:    

More recently, Congress has sidelined the Postal Service's efforts to cut costs. The agency this year unveiled a five-year plan to reach profitability that, in addition to closing low-volume facilities, would cut Saturday delivery and eliminate the requirement to prefund employee benefits. [So far, so good.] In April, the Senate approved an $11 billion cash infusion to avert a default, but delayed many of the proposed cuts for at least a year. The House is deadlocked on a bill calling for deeper cuts, in part due to opposition from lawmakers from rural districts where the cuts would hit hardest. 

Congress has come to the financial rescue repeatedly in the past, said John, and he thinks it's likely that lawmakers will do so again. The political fallout from inconveniencing millions of voters in sparsely populated areas will likely override philosophical opposition to what the agency's critics see as a "bailout." "I would think that congressmen, who for principled reasons are opposed to government intervention and who happen to represent rural districts, are going to be like a Christian Scientist with appendicitis when it comes to privatizing the post office."

And that's because postal service in the U.S. has been protected by the Constitution as a public good, by definition providing access to affordable service for all equally. All Americans have become accustomed to it, expect it and need it. To "privatize" its approach so that a "profit model" dictates contraction and constriction of its service charter and/or areas served, could significantly deny service to many--millions, apparently--who enjoyed it in the past, including many businesses. And if the elected representatives of those threatened service areas are unsuccessful in holding back the ideological "privatizers" in Congress, perhaps there is a Constitutional case to be made on behalf of those no longer well served.

It is yet another example of how little so many Americans--including so many elected conservative ideologues--really understand about the essential place and purpose of public goods that must be administered by government for the strength and welfare of society, and the benefit of individuals equally: the military, education, health care (as so many more now appreciate), and yes, the postal services, too. Cost-effective service, yes; unequal service or service denied, no.