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Explainer: Federal student loan interest rates to jump

April 18, 2014 Comments off

Explainer: Federal student loan interest rates to jump
Source: Consumer Financial Protection Bureau

Right now, many students and families across the country are receiving financial aid offers and deciding how to pay for college. Most students will need to shop for student loans now, and some of you have asked us what the new rates will be. While rates aren’t set in stone yet, interest rates on new federal student loans are expected to jump this July.

We’ve updated our Paying for College tool using our best guess of what the rates will be, so you can have a better estimate of what your monthly payment might be after graduation.

Interest rates on most federal student loans are based on a certain type of bond that the Treasury Department issues, known as the ten-year note. The yield is the rate at which investors charge the federal government for borrowing money. Next month, there will be a Treasury bond auction, and that rate will set federal student loan interest rates.

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Health Literacy and Numeracy: Workshop Summary (2014)

April 18, 2014 Comments off

Health Literacy and Numeracy: Workshop Summary (2014)
Source: Institute of Medicine

Although health literacy is commonly defined as an individual trait, it does not depend on the skills of individuals alone. Health literacy is the product of the interaction between individuals’ capacities and the health literacy-related demands and complexities of the health care system. Specifically, the ability to understand, evaluate, and use numbers is important to making informed health care choices.

Health Literacy and Numeracy is the summary of a workshop convened by The Institute of Medicine Roundtable on Health Literacy in July 2013 to discuss topics related to numeracy, including the effects of ill health on cognitive capacity, issues with communication of health information to the public, and communicating numeric information for decision making. This report includes a paper commissioned by the Roundtable, “Numeracy and the Affordable Care Act: Opportunities and Challenges,” that discusses research findings about people’s numeracy skill levels; the kinds of numeracy skills that are needed to select a health plan, choose treatments, and understand medication instructions; and how providers should communicate with those with low numeracy skills. The paper was featured in the workshop and served as the basis of discussion.

Federal Agency Charges for Reports Available Free Online

April 17, 2014 Comments off

Federal Agency Charges for Reports Available Free Online
Source: AllGov.com

The National Technical Information Service (NTIS) is something of a federal dinosaur, charging money for government reports that can be obtained elsewhere for free on the Internet.

Around since 1950, NTIS was set up as a clearinghouse for technical papers produced by the government. It has continued to sell these reports to the public even though many of them can be had for free through other agencies.

For instance, anyone interested in the National Institute for Occupational Safety and Health’s handy report on chemical hazards can order a free copy here. Or they can pay the NTIS $30.

Another example is Terrorism and Other Public Health Emergencies: A Reference Guide for Media, available for free from the Department of Health and Human Services.

The NTIS charges $16 for the report.

The agency has agreed to stop charging for reports produced by Senator Tom Coburn (R-Oklahoma), one of Congress’ most vocal critics of government waste, after his office complained. But it will continue to require payment for reports produced by other lawmakers (presumably unless they, too, tell it to stop).

Student Loan Safety Nets: Estimating the Costs and Benefits of Income-Based Repayment

April 17, 2014 Comments off

Student Loan Safety Nets: Estimating the Costs and Benefits of Income-Based Repayment
Source: Brookings Institution

The plight of underemployed college graduates struggling to make their student loan payments has received a great deal of media attention throughout the recent economic recession. The primary safety net available to borrowers of federal loans facing unaffordable monthly payments is income-based repayment, in which borrowers make monthly payments based on their earnings rather than a traditional schedule of flat payments.

The importance of these programs is widely recognized. How much these programs will cost and how the benefits will be distributed among borrowers, however, is not well understood— in large part because these costs and benefits will be realized over multiple decades. Without this knowledge, it is difficult to know whether these programs are meeting the goal of effectively and efficiently protecting borrowers without creating significant unintended consequences.

This report seeks to fill that gap by providing some of the first detailed evidence about the predicted costs and benefits of existing income-based repayment programs. Authors Beth Akers and Matthew Chingos develop an empirical framework for understanding the costs and benefits of these programs and use simulation methods to apply this framework to a nationally representative sample of bachelor’s degree recipients. These methods cannot accurately estimate the overall cost of the programs, but they provide fairly robust estimates of the relative cost of different program components, and of the share of benefits received by different groups of borrowers.

Health Care — Report Card on State Price Transparency Laws

April 16, 2014 Comments off

Report Card on State Price Transparency Laws (PDF)
Source: Catalyst for Payment Reform and Health Care Incentives Improvement Institute

Some states have robust price transparency laws and regulations, requiring them to create a publicly available website with price information based on real paid claims information; but in reality, the public can’t readily access that information because the website is poorly designed, or poorly functioning. Given that so many state-mandated websites are inadequate, once we included websites into our review and grading, no state received an “A” in this year’s Report Card. Unfortunately, New Hampshire—a state that received an A in last year’s Report Card—dropped to an F this year, because its website is inoperative and may remain so for an extended period.

Several states have “voluntary price transparency websites,” hosted by hospital associations, foundations, or nonprofits. While these sites can be a valuable resource to consumers, if they are not legislated they can be short-lived, dependent on the good will and resources of the organization that hosts them. For this reason, we did not factor in these websites when awarding the 2014 state grades; however, we did provide a review of them in Appendix I for comparison purposes.

Debt and Debt Management among Older Adults

April 15, 2014 Comments off

Debt and Debt Management among Older Adults
Source: University of Michigan Retirement Research Center

Of particular interest in the present economic environment is whether access to credit is changing peoples’ indebtedness over time, particularly as they approach retirement. This project analyzes older individuals’ debt, debt management practices, and financial fragility using data from the Health and Retirement Study (HRS) and the National Financial Capability Study (NFCS). Specifically, we examine three different cohorts(individuals age 56–61) in different time periods, 1992, 2002 and 2008, in the HRS to evaluate cross-cohort changes in debt over time. We also draw on recent data from the National Financial Capability Study (NFCS) which provides detailed information on how families manage their debt. Our goal is to assess how wealth and debt among older persons has evolved over time, along with the potential consequences for retirement security. We find that more recent cohorts have taken on more debt and face more financial insecurity, mostly due to having purchased more expensive homes with smaller down payments. In addition Boomers are more likely to have engaged in expensive borrowing practices. Protective factors include having higher income, more education, and greater financial literacy. Factors associated with financial fragility include having had more children and unexpected large income declines. Thus shocks do play a role in the accumulation of debt close to retirement, but it is not enough to have resources: people also need the capacity to manage those resources, if they are to stay out of debt as they head into retirement.

AARP Online Travel Study

April 15, 2014 Comments off

AARP Online Travel Study
Source: AARP Research

Those who are 50 or older take about six non-business related overnight trips of at least 50 miles from home per year.

Preliminary Opinion of the European Data Protection Supervisor — Privacy and competitiveness in the age of big data: The interplay between data protection, competition law and consumer protection in the Digital Economy

April 14, 2014 Comments off

Privacy and competitiveness in the age of big data: The interplay between data protection, competition law and consumer protection in the Digital Economy (PDF)
Source: European Data Protection Supervisor

EU approaches to data protection, competition and consumer protection share common goals, including the promotion of growth, innovation and the welfare of individual consumers. In practice, however, collaboration between policy-makers in these respective fields is limited.

Online services are driving the huge growth in the digital economy. Many of those services are marketed as ‘free’ but in effect require payment in the form of personal information from customers. An investigation into the costs and benefits of these exchanges for both consumers and businesses is now overdue.

Closer dialogue between regulators and experts across policy boundaries can not only aid enforcement of rules on competition and consumer protection, but also stimulate the market for privacy-enhancing services.

Payment Choice and the Future of Currency: Insights from Two Billion Retail Transactions

April 14, 2014 Comments off

Payment Choice and the Future of Currency: Insights from Two Billion Retail Transactions
Source: Federal Reserve Bank of Richmond

This paper uses transaction-level data from a large discount chain together with zip-code-level explanatory variables to learn about consumer payment choices across size of transaction, location, and time. With three years of data from thousands of stores across the country, we identify important economic and demographic effects; weekly, monthly, and seasonal cycles in payments, as well as time trends and significant state-level variation that is not accounted for by the explanatory variables. We use the estimated model to forecast how the mix of consumer payments will evolve and to forecast future demand for currency. Our estimates based on this large retailer, together with forecasts for the explanatory variables, lead to a benchmark prediction that the cash share of retail sales will decline by 2.54 percentage points per year over the next several years.

Do You Live in a Food Desert?

April 11, 2014 Comments off

Do You Live in a Food Desert?
Source: Walk Score

A food desert is a neighborhood without access to healthy food. Why does this matter? Living in a food desert can lead to higher levels of obesity and other diet-related illnesses such as diabetes and heart disease.

Walk Score helps you make more informed decisions about where to live, like finding an apartment within walking distance of a grocery store.

Many cities are making access to healthy food part of their general plans. For example, Washington D.C.’s sustainability plan sets a goal of having 75% of residents within a 5 minute walk of healthy food.

But how many people can walk to a grocery store in 5 minutes?

Today, we’re announcing a new ranking of the best and worst U.S. cities for access to food based on our database of local places and our Travel Time API and ChoiceMaps technology.

Survey Says… Health Plans Advance Retail Capabilities

April 11, 2014 Comments off

Survey Says… Health Plans Advance Retail Capabilities
Source: Deloitte

“Retail” is a hot topic in the health insurance industry today for good reasons. From the creation of health insurance marketplaces, to the continued growth in Medicaid and Medicare, to the defined contribution movement and the rise of private exchanges, the sale and delivery of health insurance is requiring an increasing focus on the individual consumer. In this context, Deloitte Consulting launched the Health Plan Retail Capabilities Benchmarking Survey to expand our understanding of the industry’s current capabilities and future investment priorities to serve the most dramatically changing segment of the health insurance market – the commercial individual market.

Forty-six health plans participated in an online survey in late 2013. Respondents represented approximately 60 percent of the commercial individual marketplace spanning national, regional, Blue Cross and Blue Shield, provider-sponsored, established and new-entrant plans. Analysis of the survey data reveals three themes:

  1. Product, pricing and consumer experience capabilities top health plan’s priority investment list
  2. Near term investment plans focus on regulatory requirements and retention capabilities but widen the aperture to consumer insight, consumer experience and channel in the longer term,
  3. Technology investments in transparency, mobility, CRM and analytics are fundamental to supporting desired business capabilities.

Financial Burden of Medical Spending by State and the Implications of the 2014 Medicaid Expansions

April 10, 2014 Comments off

Financial Burden of Medical Spending by State and the Implications of the 2014 Medicaid Expansions
Source: Urban Institute

This study is the first to offer a detailed look at medical spending burden levels, defined as total family medical out-of-pocket spending as a proportion of income, for each state. It further investigates which states have greater shares of individuals with high burden levels and no Medicaid coverage, but would be Medicaid eligible under the 2014 rules of the Affordable Care Act should their state choose to participate in the expansion. This work suggests which states have the largest populations likely to benefit, in terms of lowering medical spending burden, from participating in the 2014 adult Medicaid expansions.

IP in a World Without Scarcity

April 10, 2014 Comments off

IP in a World Without Scarcity
Source: Social Science Research Network

Things are valuable because they are scarce. The more abundant they become, they cheaper they become. But a series of technological changes is underway that promises to end scarcity as we know it for a wide variety of goods. The Internet is the most obvious example, because the change there is furthest along. The Internet has reduced the cost of production and distribution of informational content effectively to zero. In many cases it has also dramatically reduced the cost of producing that content. And it has changed the way in which information is distributed, separating the creators of content from the distributors.

More recently, new technologies promise to do for a variety of physical goods and even services what the Internet has already done for information. 3D printers can manufacture physical goods based on any digital design. Synthetic biology has automated the manufacture not just of copies of existing genetic sequences but any custom-made gene sequence, allowing anyone who want to create a gene sequence of their own to upload the sequence to a company that will “print” it using the basic building blocks of genetics. And advances in robotics offer the prospect that many of the services humans now provide can be provided free of charge by general-purpose machines that can be programmed to perform a variety of complex functions. While none of these technologies are nearly as far along as the Internet, they share two essential characteristics with the Internet: they radically reduce the cost of production and distribution of things, and they separate the informational content of those things (the design) from their manufacture. Combine these four developments – the Internet, 3D printing, robotics, and synthetic biology – and it is entirely plausible to envision a not-too-distant world in which most things that people want can be downloaded and created on site for very little money.

The role of IP in such a world is both controverted and critically important. IP rights are designed to artificially replicate scarcity where it would not otherwise exist. In its simplest form, IP law takes public goods that would otherwise be available to all and artificially restricts their distribution. It makes ideas scarce, because then we can bring them into the economy and charge for them, and economics knows how to deal with scarce things. So on one view – the classical view of IP law – a world in which all the value resides in information is a world in which we need IP everywhere, controlling rights over everything, or no one will get paid to create. That has been the response of IP law to the Internet so far.

CFPB Orders Bank Of America To Pay $727 Million In Consumer Relief For Illegal Credit Card Practices

April 9, 2014 Comments off

CFPB Orders Bank Of America To Pay $727 Million In Consumer Relief For Illegal Credit Card Practices
Source: Consumer Financial Protection Bureau

The Consumer Financial Protection Bureau (CFPB) has ordered Bank of America, N.A. and FIA Card Services, N.A. to provide an estimated $727 million in relief to consumers harmed by practices related to credit card add-on products. Roughly 1.4 million consumers were affected by Bank of America’s deceptive marketing of their add-on products. Bank of America also illegally charged approximately 1.9 million consumer accounts for credit monitoring and credit reporting services that they were not receiving. Bank of America will pay a $20 million civil money penalty to the CFPB.

Housing — In Search of Affordability

April 9, 2014 Comments off

In Search of Affordability
Source: Zillow

Across the United States, strong home price affordability has been recently eroded by a combination of rising home prices and mortgage rates. Some areas, particularly on the West Coast, have begun to look unaffordable compared to their historic norms, forcing some household to look to the periphery of urban areas in search of affordable homes.

At Zillow, we measure affordability by looking at how much of a person’s monthly income is spent on a mortgage payment. Historically in the United States, the median household would need to spend 22.1 percent of their income to afford the mortgage payments on the median home. This number fell dramatically during the housing recession, hitting a low of under 13 percent by the end of 2012.

Since then, both prices and interest rates have recovered, increasing the share of income needed to buy the median home to 15.1 (2013 Q4) percent nationwide – higher than in 2012, but still well below its historical average. This share of income is up from 15.0 percent reported in 2013 Q3 for the U.S. Looking forward, the U.S. is forecasted to remain more affordable than its historical average, as long as interest rates remain below 7 percent over the next year – an extremely likely scenario.

Participation Rises in Medicare Physician Quality Reporting System and Electronic Prescribing Incentive Program

April 9, 2014 Comments off

Participation Rises in Medicare Physician Quality Reporting System and Electronic Prescribing Incentive Program
Source: U.S. Department of Health and Human Services (Centers for Medicare & Medicaid Services)

The Centers for Medicare & Medicaid Services (CMS) today released the 2012 Physician Quality Reporting System and Electronic Prescribing (eRx) Experience Report, showing a significant increase in participation in two key programs that allow eligible professionals to earn incentive payments through voluntary participation.

“Our physician and other clinician quality programs reached new records this year with over 430,000 professionals participating in the Physician Quality Reporting System and over 340,000 e-prescribing,” said Patrick Conway, M.D. deputy Administrator for innovation and quality and chief medical officer at CMS. “Clinicians are actively measuring and reporting on quality, and CMS is in the beginning stages of adding this information to the Physician Compare website, which can be viewed by patients. Measuring, transparently sharing, and improving quality performance is key to a better health system.”

The full report can be found at http://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/PQRS/Downloads/2012-PQRS-and-eRx-Experience-Report.zip

The Physician Quality Reporting System (PQRS) has been using incentive payments, and will begin to use payment adjustments in 2015, to encourage eligible health care professionals to report on designated quality measures. The Electronic Prescribing (eRx) Incentive Program used a combination of incentive payments and payment adjustments to encourage electronic prescribing by eligible professionals.

New From the GAO

April 8, 2014 Comments off

New GAO Reports and Testimonies
Source: Government Accountability Office

Reports

1. Medicare: Second Year Update for CMS’s Durable Medical Equipment Competitive Bidding Program Round 1 Rebid. GAO-14-156, March 7.
http://www.gao.gov/products/GAO-14-156
Highlights - http://www.gao.gov/assets/670/661475.pdf

2. 2014 Annual Report: Additional Opportunities to Reduce Fragmentation, Overlap, and Duplication and Achieve Other Financial Benefits. GAO-14-343SP, April 8.
http://www.gao.gov/products/GAO-14-343SP
Podcast - http://www.gao.gov/multimedia/podcasts/662283

3. Aviation Safety: FAA Should Improve Usability of its Online Application System and Clarity of the Pilot’s Medical Form. GAO-14-330, April 8.
http://www.gao.gov/products/GAO-14-330
Highlights - http://www.gao.gov/assets/670/662388.pdf

4. Military Capabilities: Navy Should Reevaluate Its Plan to Decommission the USS Port Royal. GAO-14-336, April 8.
http://www.gao.gov/products/GAO-14-336
Highlights - http://www.gao.gov/assets/670/662377.pdf

5. Information Security: IRS Needs to Address Control Weaknesses That Place Financial and Taxpayer Data at Risk. GAO-14-405, April 8
http://www.gao.gov/products/GAO-14-405
Highlights - http://www.gao.gov/assets/670/662372.pdf
Podcast - http://www.gao.gov/multimedia/podcasts/662350

Testimonies

1. Paid Tax Return Preparers: In a Limited Study, Preparers Made Significant Errors, by James R. McTigue Jr., director, strategic issues, before the Senate Committee on Finance. GAO-14-467T, April 8.
http://www.gao.gov/products/GAO-14-467T
Highlights - http://www.gao.gov/assets/670/662357.pdf

2. Tobacco Products: FDA Spending and New Product Review Time Frames, by Marcia Crosse, director, health care, before the Subcommittee on Health, House Committee on Energy and Commerce. GAO-14-508T, April 8.
http://www.gao.gov/products/GAO-14-508T
Highlights - http://www.gao.gov/assets/670/662361.pdf

3. Government Efficiency and Effectiveness: Opportunities to Reduce Fragmentation, Overlap, and Duplication and Achieve Other Financial Benefits, by Gene L. Dodaro, Comptroller General of the United States, before the House Committee on Oversight and Government Reform. GAO-14-478T, April 8.
http://www.gao.gov/products/GAO-14-478T
Highlights - http://www.gao.gov/assets/670/662367.pdf

Restaurant Owners’ Perspectives on a Voluntary Program to Recognize Restaurants for Offering Reduced-Size Portions, Los Angeles County, 2012

April 8, 2014 Comments off

Restaurant Owners’ Perspectives on a Voluntary Program to Recognize Restaurants for Offering Reduced-Size Portions, Los Angeles County, 2012
Source: Preventing Chronic Disease (CDC)

Introduction
Reducing the portion size of food and beverages served at restaurants has emerged as a strategy for addressing the obesity epidemic; however, barriers and facilitators to achieving this goal are not well characterized.

Methods
In fall 2012, the Los Angeles County Department of Public Health conducted semistructured interviews with restaurant owners to better understand contextual factors that may impede or facilitate participation in a voluntary program to recognize restaurants for offering reduced-size portions.

Results
Interviews were completed with 18 restaurant owners (representing nearly 350 restaurants). Analyses of qualitative data revealed 6 themes related to portion size: 1) perceived customer demand is central to menu planning; 2) multiple portion sizes are already being offered for at least some food items; 3) numerous logistical barriers exist for offering reduced-size portions; 4) restaurant owners have concerns about potential revenue losses from offering reduced-size portions; 5) healthful eating is the responsibility of the customer; and 6) a few owners want to be socially responsible industry leaders.

Conclusion
A program to recognize restaurants for offering reduced-size portions may be a feasible approach in Los Angeles County. These findings may have applications for jurisdictions interested in engaging restaurants as partners in reducing the obesity epidemic.

FRB Atlanta — Econ South – First Quarter 2014

April 8, 2014 Comments off

Econ South – First Quarter 2014
Source: Federal Reserve Bank of Atlanta

The Economic Plight of Millennials
The millennial generation is entering the labor force with one trait in common: they watched as the Great Recession dramatically reshaped the landscape of employment, housing, and their overall expectations. How profoundly will the economic downturn and its associated effects mark this generation?

How We Pay: Results from the Federal Reserve’s Latest Payments Study
Changes in technology have affected not only how people live and work, they have also affected how individuals and businesses pay for goods and services. The Federal Reserve’s most recent triennial study of the payments system highlights a number of shifts in this dynamic arena.

Changing Channels: The Evolving Face of Media in the Southeast
New digital devices and enhanced technology have given consumers a feast of content to consume. Although consumers are the clear winners in this new media landscape, regional players in the communications field are scrambling to remain in the game.

CRS — Regulation of Clinical Tests: In Vitro Diagnostic (IVD) Devices, Laboratory Developed Tests (LDTs), and Genetic Tests

April 7, 2014 Comments off

Regulation of Clinical Tests: In Vitro Diagnostic (IVD) Devices, Laboratory Developed Tests (LDTs), and Genetic Tests (PDF)
Source: Congressional Research Service (via Federation of American Scientists)

In vitro diagnostic (IVD) devices are used in the analysis of human samples, such as blood or tissue, to provide information in making health care decisions. Examples of IVDs include (1) pregnancy test kits or blood glucose tests for home use; (2) laboratory tests for infectious disease, such as HIV or hepatitis and routine office blood tests such as for cholesterol and anemia; and (3) tests for various genetic diseases or conditions. More recently, a specific diagnostic test—called a companion diagnostic—may be used to select the best therapy, at the right dose, at the correct time for a particular patient; this is often referred to as personalized medicine.

Federal agencies involved in the regulation of IVDs include the Food and Drug Administration (FDA) and the Centers for Medicare & Medicaid Services (CMS). FDA derives its authority to regulate the sale and distribution of medical devices, such as IVDs, from the Federal Food, Drug, and Cosmetics Act and the Public Health Service Act. CMS’s authority to regulate IVDs is through the Clinical Laboratory Improvement Amendments of 1988. FDA regulates the safety and effectiveness of the diagnostic test as well as the quality of the design and manufacture of the diagnostic test, and CMS regulates the quality of clinical laboratories and the clinical testing process.

Traditionally, most genetic tests have not been subject to premarket review by the FDA. This is because in the past, genetic tests were developed by laboratories primarily for their in-house use—referred to as laboratory-developed tests (LDTs)—to diagnose rare diseases and were highly dependent on expert interpretation. However, more recently LDTs have been developed to assess relatively common diseases and conditions, thus affecting more people, and direct-to-consumer (DTC) genetic testing has become widely available over the Internet. In June 2010 FDA announced its decision to exercise its authority over all LDTs. FDA has provided a number of reasons for the decision to assert its enforcement authority over LDTs, including that the public needs assurances that LDTs are sound and reliable. FDA has not yet finalized guidance with respect to all LDTs. A provision in the Food and Drug Administration Safety and Innovation Act stipulates that the agency “may not issue any draft or final guidance on the regulation” of LDTs without “at least 60 days prior to such issuance,” first notifying Congress “of the anticipated details of such action.”

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