Feature

Your Ultrasound Isn’t A Car. Why Are You Told To Shop Like It Is?

When my doctor suggested an ultrasound for the pelvic pain I was experiencing, my first question was “How much will that cost?” I am one of the many Americans with a high-deductible health care plan — $10,000 to be exact. I often scoff that my health insurance is a “get-in-a-doctor’s-door-plan,” because I pay cash for basically everything anyway.

My doctor, recalling my poor insurance, asked, “Do you ever get to the other side of the state?” I looked at her quizzically. “Because there’s an imaging service over there that offers ultrasounds for …” She paused and searched her computer. “Let’s see … $137, maybe closer to $300 if they think you need both abdominal and transvaginal. But it’s like a two-hour drive.”

My eyes bulged out of my head. I was billed more than $1,000 for the last ultrasound I’d had at my local hospital years earlier.

“I’ll drive,” I said.

I was relieved that my doctor told me about the discounted service. If I’d had to pay $1,000 or more out of pocket then I would have put off the procedure, like so many Americans do (and that’s if I ever got it at all). I had no idea that health care service costs could vary so wildly.

Not only do prices vary from place to place, but the amount a patient will pay for the same service within the same hospital can vary depending on whether a patient has health insurance and what health insurance plan a patient has. When I called my local hospital to compare their prices for the ultrasound, I was told that it would cost around $700 with my insurance. If I were uninsured, that price would go up to almost $1,200. Meanwhile, that $137 option was a two-hour drive away — I just had to know where to look.

People looking for a car are told to shop around, maybe get a used car, or borrow one from a friend. Too often that same ethos is pushed into the health care space, with patients told to look around for the best deal or negotiate prices with providers. But price shopping for health care services is not as straight-forward as price shopping for a vehicle, despite legislative attempts to solve the problem.

At the beginning of the year, a new rule went into effect that requires hospitals to post their list prices online. But, as Kaiser Health News points out, that kind of transparency won’t have much of an impact because patients can’t understand those prices. The lists are full of incomprehensible abbreviations, list services separately that would always be bundled together, and vary depending on a person’s specific health plan, so consumers cannot get the type of information they need for comparison shopping. Moreover, these are just the list prices charged by hospitals; they do not include the price of physicians’ services during the hospital stay.

Not everyone has a doctor like mine, who actively looked out for my financial interests. And many times, even when people do try to calculate costs ahead of time, the tools they’re given turn out to be wildly inaccurate. One person profiled by the Philadelphia Inquirer, who proactively used her insurer’s price estimator tool to calculate the out-of-pocket cost of a breast MRI, was shocked when she was billed more than twice what the tool had suggested would be the upper-end range of out-of-pocket costs for the procedure.

Plus, finding the cheapest care is just the first hurdle.

My ability to access more affordable diagnostic services depended on a lot of things aligning — I had to have flexibility in my schedule to drive to a discounted imaging service provider, and I needed a vehicle that could make the trip. When all of those things did happen, I still had to shuffle work deadlines, time the appointment so that the drive there and back didn’t conflict with my kids’ school drop-off, and arrange for after-school care for them.

Health care isn't Amazon, where items are easily searched for, compared, and where prices are fixed.

That same flexibility simply isn’t possible for everyone. Nearly 1 in 5 workers experience unstable work hours, which makes it impossible to schedule time to head to a different health provider in order to take advantage of cheaper care. Also, around 9 percent of Americans don’t own a car, and in recent years the number of people obtaining driver’s licenses has been trending downward. In rural areas, the nearest health care provider could be hours away. Though I live in an urban area, the nearest discounted service provider was a two-hour drive.

In an emergency, no one has time to inquire about costs. And even in less urgent situations, there is often no way to accurately determine prices. While hospitals are now required to post their price lists online, health care isn’t Amazon, where items are easily searched for, compared, and where prices are fixed. And high-deductible insurance plans are increasing in number, including in employer-sponsored plans, as insurers attempt to cost-shift onto consumers. That means more people are going to be in the same place I was over time.

On my drive to the other side of the state, I considered how fortunate I was to be able to access discounted health services. But being a self-employed person with a vehicle should not provide me with more options than someone with a less flexible work schedule or who doesn’t have a car. No one should have to waste precious time searching aimlessly for the best deal for treatment, and no one should have to go without because they didn’t know it was more affordable elsewhere or because the more affordable location was not accessible.

Until the U.S. chooses to recognize health care as a human right, rather than a commodity or entitlement, the poorest Americans will continue to suffer.

 

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Feature

The Shutdown Is Causing Mass Confusion for Food Stamp Recipients

“Every year, getting the materials together for SNAP recertification is difficult. They ask for a lot of information and they almost always say you are missing something no matter how much you give them,” a Supplemental Nutrition Assistant Program (SNAP, formerly known as food stamps) beneficiary explained between frantic calls to her local office for information about her benefits.

This year, the renewal process has been made even harder by the partial government shutdown, which accelerated deadlines with no notice for the more than 40 million people who receive benefits. And that’s just one of the effects the shutdown has had on SNAP and other nutrition assistance programs.

On Jan. 8, the U.S. Department of Agriculture announced that February SNAP benefits would be distributed by Jan. 20, in order to get around shutdown-related restrictions. That called for a herculean effort: Millions of new applications and recertifications that would normally be due in February now need to be submitted by mid-January. Normally, new applications and annual recertifications take place on a rolling basis. For recipients who couldn’t gather supporting material in time or didn’t know about the deadline, such as furloughed federal workers hoping for nutrition assistance while they remain without pay, the time to file for benefits has already come and gone.

At the same time, some grocers have stopped accepting SNAP because the government shutdown means they cannot renew their licenses. As the shutdown continues, the number of vendors will dwindle, a particular issue for people in areas with limited options.

The effects of these problems are wide-reaching. Nearly half of SNAP recipients are children, and LGBTQ people, along with disabled people, are much more likely to need nutrition assistance.

States administer the SNAP program, and the state-by-state chaos has been frustrating. “I have not received any update from the state’s human resource department about how this would affect us. In every other instance of benefit changes, we are sent copious written notification(s),” another recipient told TalkPoverty via email. Documentation also sometimes contradicted itself, adding even more uncertainty to the process.

Others reported that they heard about the deadline from news stories or Facebook, and struggled to get answers from officials in local offices — many of which set different deadlines, making it difficult to determine when applications and renewals needed to be submitted. At least one recipient read on social media that SNAP benefits distribution would be reversed if agencies ran out of money, something that shouldn’t be possible with EBT cards. Confusion and fear like this are familiar for many low-income people, who sometimes feel at the whims of capricious government policies and procedures.

“I’ll push myself not to use [benefits distributed early] until February but there’s a fear they could be taken away. Everything just seems so uncertain. Poor people know to use what we have when we have it because we can’t depend on what will be there in the future,” said one SNAP recipient.

SNAP is not the only nutrition assistance program with funding thrown into uncertainty by the shutdown. Also threatened are the Special Supplemental Nutrition Program for Women, Infants, and Children, known as WIC, which supplies benefits to 7 million pregnant people, new parents, infants, and children, and the Food Distribution Program in Native American communities, which fed over 90,000 people a month in 2017. The latter adds to the shutdown-induced woes — which include limitations on access to health care — in Native communities. The national free and reduced-price lunch program, which feeds more than 30 million kids annually, could also be in danger if the shutdown persists into March.

Even after the government reopens, the danger isn’t over, thanks to a dangerous Trump administration proposal to make work requirements even harsher in SNAP, which Congress explicitly refused to do in the latest Farm Bill. Currently, 33 states and Washington, D.C. have waivers in place for high unemployment areas to relieve the strict time limits for so-called “able-bodied adults without dependents” written into SNAP in 1996, which restrict benefits eligibility to three months out of every three years for those considered “able-bodied” with no legal dependents. The Trump administration wants to sharply curtail states’ flexibility to use these waivers, throwing 755,000 under- and unemployed people off SNAP.

“I don’t have contingency plans because I can’t have any,” says a disabled SNAP recipient in Colorado who struggled to get an answer about her recertification documents, normally due in February. Members of low-income communities have extensive experience creating their own safety nets to support each other through hard times, but “I think that people are going to get burnt out and stretched too thin by all the need that surrounds them.”

Editor’s note: This post has been updated to clarify the Trump administration proposal on SNAP work requirements and the current status of work requirement waivers.

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Analysis

There’s a Retirement Crisis. The New $15 Minimum Wage Bill Could Help.

We’re two weeks into the 116th Congress, every day of which has been consumed by the longest government shutdown in U.S. history. The president has manufactured this crisis, holding the government hostage to fund a symbol of his xenophobia, while ignoring the deep, snowballing damage he is inflicting on workers, families, and the economy. But Trump’s shutdown doesn’t mean newly-empowered congressional Democrats have been twiddling their thumbs.

Yesterday, House and Senate Democratic leadership introduced the Raise the Wage Act, which would gradually increase the federal minimum wage to $15 per hour by 2024. It would also link the minimum wage to median wage growth thereafter, and phase out sub-minimum wages for tipped workers, which has been stuck at $2.13 per hour for 28 years, and workers with disabilities, which allows employers to pay disabled workers as little as pennies per hour.

If passed, the new federal bill would also have far-reaching consequences that aren’t widely touted — including helping address America’s growing retirement crisis.

As of 2013, nearly one in five Americans age 55 to 64 had zero retirement savings or pension. The crisis is much more acute for lower-income Americans: While nearly nine in 10 families in the top fifth of the income distribution have retirement account savings, fewer than one in 10 families in the bottom fifth do.

It’s not surprising, then, that seniors increasingly rely on Social Security’s very modest benefits, which make up 90 percent or more of the income of nearly one in four seniors — a share that rises to more than six in 10 for those in the bottom fifth of the income scale.

The yawning gap between the high pay of the rich and the stagnant or declining pay of the working and middle class is a key driver of the crisis: According to the Urban Institute, rising wage inequality means that today’s 45-year-olds in the bottom fifth of the lifetime earnings distribution will have 3 percent less retirement income than today’s seniors, 25-year-olds will have 6 percent less, and 5-year-olds will have 13 percent less. Meanwhile, for the richest fifth, annual retirement income will rise over time.

The amount a worker can afford to save for retirement is tied to her earnings, and the Urban Institute researchers find that raising the federal minimum wage from $7.25 to just $12 — below the $15 Congressional Democrats have proposed — would offset nearly 60 percent of the retirement income lost by the bottom fifth of today’s 25-year-olds, and nearly 40 percent lost by today’s 5-year-olds.

The minimum-wage bill’s impact would be especially profound on workers of color — particularly black workers, a full 40 percent of whom would get a raise. Black workers are paid much lower wages than their white counterparts, with the typical full-time, year-round black male worker earning just 70 percent of what a white male worker earns, while black women make just 61 percent. They also face a much more severe retirement crisis, exacerbated by systematic inequalities that hamper saving, prevent wealth-building, and inhibit upward mobility. Black Americans who are nearing retirement age have only about 10 percent as much wealth as whites in the same age group. Social Security benefits made up at least 90 percent of income for 46 percent of black seniors, compared to 35 percent of whites.

The low-wage, low-quality jobs disproportionately held by workers of color don’t pay enough to make ends meet — much less save — nor do many offer the tax-preferenced retirement accounts such as 401(k) plans and individual retirement accounts (IRAs) that help build wealth. As a consequence of shorter life expectancy and lack of resources, many black men will die before they are able to retire.

This raise is a decade overdue: In 2019, a worker earning $7.25 per hour will lose nearly $2,600 compared to 2009 — when the federal minimum wage last went up — because inflation has eroded the wage’s purchasing power. A $15 minimum wage would also lift millions of Americans out of poverty, dramatically reduce spending on public assistance programs, and improve infant health. In just the last five years, 22 states and Washington, DC, have increased their minimum wages, at little or no cost to government and without the job losses conservative pundits claim will result.

Americans get it: In every single state, voters say want their state’s minimum wage to be higher than it currently is. By passing the Raise the Wage Act, Congress would rightly give voters what they’re demanding, and help address the retirement crisis at the same time.

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Feature

For Low-Income Americans, the IRS Is Always Shut Down

The ongoing partial government shutdown has dragged on for more than 24 days, and it doesn’t look like the Trump administration is interested in ending it any time soon. One of the agencies affected is the IRS, and the longer the shutdown continues, the likelier it is that tax season becomes ensnared in a significant way. The Trump administration was spooked enough by the prospect of people not receiving their 2018 tax refunds that it ordered furloughed IRS employees back to work, despite the fact that it may be illegal.

Delayed refunds are indeed a big concern, especially for those low-income Americans who depend on their yearly tax refund to make ends meet, and who tend to file their returns first. But in many ways, delayed refunds are a status quo issue for poorer households, along with a host of other problems brought about by bad IRS policy and shortchanged IRS budgets. For low-income Americans, the IRS doesn’t work even when the government is fully open for business.

For starters, as the IRS Taxpayer Advocate Service – which is the public’s representative at the agency – wrote in its latest report to Congress, the IRS is not doing enough for the tens of millions of people who don’t have reliable internet access. If those people want to call the IRS to get help with their taxes, instead of using the website, odds are they won’t get to speak to anyone. The Taxpayer Advocate Service estimated that, in fiscal year 2018, 60 percent of attempts to receive live assistance from the agency over the phone would fail.

To its credit, the IRS does offer free in-person tax prep to low-income people via the Volunteer Income Tax Assistance program and the Taxpayer Counseling for the Elderly program – VITA and TCE, respectively. 90 percent of those eligible for the former program make less than $54,000 per year. However, likely due to problems regarding publicity, locations, and inability to take time off to meet with a VITA volunteer, very few eligible households can take advantage of these services. Of the 108 million individual tax filers in 2017 who were eligible for the programs, just 3.5 million successfully had their taxes submitted.

Most people, instead, turn to paid tax prep, paying a fee to do something that should be free and easy. According to the Tax Policy Center, more than half of households earning less than $30,000 annually use paid tax prep, which costs an average of $176 for a basic federal and state return.

Between January and October last year, non-identity theft refund fraud at the IRS has a false positive rate of 81 percent, meaning more than 8 in 10 refunds flagged by auditors showed no evidence of fraud after they were investigated.

In return for that money, they receive more potential problems: Tax preparers are more likely to make a mistake than households who do their taxes themselves, and are especially bad, per a 2014 Government Accountability Office study, at correctly calculating the Earned Income Tax Credit, which specifically goes to lower-income households. Of course, those households are the least able to absorb an IRS penalty for improper filing.

The big tax prep companies, in partnership with the IRS, do offer up free filing to people who qualify, usually on the basis of low incomes, but those programs are hard to navigate and full of tricks that push people into paid filing systems. Many states also don’t allow free filing programs at all for their own state-level income taxes. Only 3 percent of people eligible for free private filing programs actually use them, and most don’t come back to repeat the experience the following year.

While the IRS has not been making it easier for low-income people to pay their taxes, there is one way that it has been giving them special attention: fraud investigations. Last year, more than one-third of IRS audits were of taxpayers eligible for the Earned Income Tax Credit, which for a single filer with no children can only be claimed if you make less than $15,000. Those receiving the EITC are audited at twice the rate of wealthy Americans who make between $200,000-$500,000.

Having a return flagged for audit can mean all sorts of hassles, even if it turns out nothing was done wrong, which is the most likely outcome. Between January and October last year, non-identity theft refund fraud at the IRS has a false positive rate of 81 percent, meaning more than 8 in 10 refunds flagged by auditors showed no evidence of fraud after they were investigated. And good luck to anyone who calls the IRS, actually reaches a live person, and wants to know why their return has been labeled as problematic: IRS customer service reps don’t have access to the non-identity fraud case management system.

Such flagging can mean a long wait for a refund even if the fraud charge was unfounded. More than one-third of the people who were flagged improperly in 2017 had to wait 11 weeks or more to receive their money.

These problems are not the fault of the IRS staff. The issue is that conservatives have intentionally starved it of funds. The 2018 IRS budget was $2.5 billion below what was spent on the agency in 2010, adjusted for inflation – a decline of 18 percent. Over and over, the IRS has been asked to do more with less; its budget has been lower than the previous year every year since 2010, save for one. Tax prep companies also have a stake in the status quo – as more difficult taxes mean more fees – and they lobby accordingly. H&R Block and Intuit spent about $3 million and $2 million respectively last year on a variety of bills, some of which would have made paying taxes easier, such as the Tax Filing Simplification Act of 2017.

It’s undoubtedly a bad thing that the IRS – and the rest of the government – is partially shut down. But even at the best of times, the agency doesn’t work for low-income Americans. Simply opening the doors again won’t change that.

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Feature

America’s Most Famous Novel About Bad Meat Was Actually About Immigrant Labor Abuses

“I aimed at the public’s heart, and by accident I hit it in the stomach,” Upton Sinclair famously wrote of his novel, The Jungle.

The quote, taken from his essay “What Life Means to Me” for Cosmopolitan Magazine, has come to be understood as Sinclair bemoaning The Jungle’s failure to galvanize a socialist revolution in the United States. Instead, the novel ignited a national controversy over the unsanitary practices of the meatpacking industry. Within a year of the novel’s publication in 1906, Congress passed both the Federal Meat Inspection Act and the Pure Food and Drug Act, establishing the agency that would later become the Food and Drug Administration.

But aside from being the muckraking novel that led to the creation of the FDA or a socialist call to arms that went largely unheard, The Jungle is a story of how U.S. society exploits immigrants. This reading is often overlooked, yet it is worth remembering that sympathy for and solidarity with immigrants is at the heart of this seminal work of literature — especially amid the xenophobic atmosphere of the United States today, where the president has shut down the government over a border wall with Mexico, detention facilities hold untold numbers of immigrants, and Immigration and Customs Enforcement agents stalk communities across the country. It’s been more than a century since the publication of The Jungle, yet the predation described by Sinclair still persists.

While The Jungle is a novel, it is not entirely a work of fiction. As Anthony Arthur explains in Radical Innocent, his biography of Sinclair, The Jungle is based on two months Sinclair spent living and conducting research in Packingtown, the Chicago neighborhood at the heart of the U.S. meatpacking industry in the early 1900s. There, Sinclair toured stockyards and meatpacking plants both openly and undercover, interviewing everyone from laborers to foremen, social workers to chemists, priests to police officers.

Distilling all of this reporting into a fictional narrative was not unusual for the time; what mattered was that Sinclair’s claims stood up to scrutiny. The meatpacking industry denied everything, but investigators dispatched by then-President Theodore Roosevelt after he read The Jungle found that, as the president relayed, “the Chicago stock yards are revolting.”

Yet very little of The Jungle has to do with unsanitary meatpacking practices. Depending on the edition, the novel runs between 300 and 500 pages, and “perhaps thirty in all” describe meatpacking, according to Arthur. Dedicated to “The Workingmen of America,” The Jungle was openly meant to bring attention to the plight of working people at large.

If it were not for the immigrants at the center of The Jungle, Sinclair would not have had a narrative on which to hang his facts. The author struggled to connect everything he had witnessed in the meatpacking plants to what he wanted to say about socialism until stumbling across, and being invited into, a Lithuanian wedding in Packingtown. As Sinclair later wrote in his autobiography, “There were my characters … I watched them one after another, fitted them into my story.” The Lithuanian wedding thus provided the entire framework of The Jungle: A tale of immigrants searching for a better life but finding only exploitation and misery.

Sinclair may have accidentally produced a lasting portrait of immigrant exploitation.

The Jungle focuses on Jurgis Rudkus, a young Lithuanian man who comes to the United States with his extended family. He is easily a stand-in for all the immigrant workers of Packingtown. As Sinclair has long-time local resident Grandmother Majauszkiene explain in the novel, Packingtown was always home to immigrants working in the meatpacking industry — first German, then Irish, Czech, Polish, Lithuanian and, increasingly, Slovak. Each new group was brought in by the employing “packers” to undercut the previous workers; the most recent immigrants were paid lower wages and treated worse until an even more desperate group could be found. “Who there was poorer and more miserable than the Slovaks, Grandmother Majauszkiene had no idea,” writes Sinclair, “but the packers would find them, never fear.”

Similarly, the trials that Rudkus and his family endure are the trials of each successive wave of immigrants. They abandon prospectless Lithuania for the promise of rewarding work in the United States. Hearing rumors of a fellow Lithuanian making it rich in Chicago, they head to the Windy City, where Jurgis finds work in a meatpacking plant, marries his wife Ona, and purchases a home for the entire family.

The journey was not idyllic, and it only gets worse. Buffeted by unemployment, dangerous working conditions, alcoholism, violence and systemic corruption, the family is driven further and further into abject poverty as almost every aspect of society — employers, landlords, politicians, police, merchants — preys upon them. Following the sudden deaths of his wife and his son, Jurgis’ downward spiral is halted only by his discovery of socialism.

Just as The Jungle accidentally caused a nationwide furor over the meatpacking industry, Sinclair may have accidentally produced a lasting portrait of immigrant exploitation; he was aiming to describe every workers’ struggle, but he most squarely hit upon the immigrant workers’ experience. A key difference, though, is that the “meat-graft” was addressed with reforms that are still in force today. In 1906, the Pure Food and Drug Act established the Bureau of Chemistry, which would become the FDA in 1930, and the Federal Meat Inspection Act tasked the U.S. Department of Agriculture with monitoring meatpacking plants, a task for which it is still responsible.

The same commitment to reform has not been applied to immigrant workers. Upon arriving in the United States today, immigrants face wage gaps that last for decades, with earnings remaining 10 to 23 percent less than comparably educated and experienced native workers, even after 20 years of residence. Immigrants are also more likely to work more dangerous jobs, and undocumented immigrants are often victimized by employers, with 37 percent paid below minimum wage and 84 percent denied overtime. In fact, so little has changed since Sinclair penned The Jungle that immigrants still make up much of the Midwestern meatpacking industry’s workforce, filling dangerous, poorly paid jobs with little security. The stockyards of Packingtown closed in 1971, but they still haven’t gone away.

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