Hey Republicans: If you want to cut ObamaCare, try wellness programs

Few people will have noticed new rules around corporate "health-contingent wellness programs" (emphases mine):

Administration Defines Benefits Under Health Law - NYTimes.com

... The rules also give employers new freedom to reward employees who participate in workplace wellness programs intended to help them lower blood pressure, lose weight or reduce cholesterol levels. The maximum permissible reward would be increased to 30 percent of the cost of coverage, from the current 20 percent.

The rules would further increase the maximum reward to 50 percent for wellness programs intended to prevent or reduce tobacco use.

Rewards could amount to several thousand dollars a year, officials said, because total premiums in employer-sponsored health plans now average more than $5,600 a year for individual coverage and nearly $16,000 for family coverage...

The Hill's Healthwatch has more details. It is remarkable that CNBC can have a general freakout about an increase in marginal federal tax rates for persons earning over $250,000 a year, but say nothing about a program that costs middle-class workers $2,000-$3,000 a year.

Let us take a moment to contemplate this curious silence.

Yes, I said costs, because the money for these programs has to come from somewhere. In this case it comes out of take home pay - either as a direct benefit cost or as a reduction in future income. In some cases the money might come out of ACA mandated health insurance premium rebates ...

Health Insurance Refunds May Stall in Employers’ Hands - NYTimes.com

... while some employers are returning the money directly in paychecks, or planning “premium holidays” that increase take-home pay, others are weighing different options, benefits consultants said, like reducing next year’s premium, or spending the refund on so-called wellness programs that reward workers who lose weight or quit smoking.

Yeah, that's a bad sign.

In theory the money we're losing now might be offset by reduced healthcare costs over time, which might in theory reduce insurance costs and maybe one day the lost income might trickle back down again.

*cough*

Right. That's not going to happen.

It is also possible that, regardless of impact on health care costs, and after considerable administrative overhead is deducted, these programs will make some workers healthier than they might otherwise be. In that sense they might be considered a form of social transfer; all employees pay for improved health habits for some employees.

That wouldn't be so bad - if we knew the programs worked. But we don't know that; these programs were launched with very little research. What little I could find showed some surprises ....

New Research Shows That Prevention Is Key To Reducing Health Care Costs For All Employees, Even Those With Chronic Conditions - New York Times

... while a reduction in employee health risks leads to immediate cost savings, the accumulation of additional health risks soon leads to substantially higher medical and pharmacy costs...

I don't know why corporations are so keen on these programs, but I suspect there are sound business reasons. They may not be obvious; I'm reminded that Walmart liked defined contribution plans because they discriminated against unhealthy (and costly) spouses. I have read that some states offer tax credits for the programs, and I assume that the $2,000 a year or so I'm paying for our corporate program is treated as a tax deductible health care benefit.

Which brings me to the GOP. They're looking to cut money from the ACA. Why not do something useful and ask about corporate wellness programs?

Right. I bet this is one of those things that made it into the ACA as a sop to the GOP...

See also:

• Gordon's Notes: The Walmart healthcare memo: You DO need to read the original 11/2005
• Wellness Tax Credit (a curious unlaunched astroturf site)
• Workplace wellness - Wikipedia, the free encyclopedia
• Corporate Wellness Programs | American Institute for Preventive Medicine

Baumol's disease and the demographic transition: Productivity asymmetry means children are increasingly expensive

There have been a flurry of articles lately on the cost of raising an American child, including a NYT blog post. This old news to students of demography, I remember reading about this back in the 80s. In agricultural societies children are a net economic gain, in industrial societies the gain is less, and in post-industrial societies they are a net negative for parents.

I should add, by the way, that traditional evaluations of the cost of children underestimate the cost. They assume a healthy neurotypical child. A special needs child is vastly more expensive, and approximately 5-10% of post-industrial children are relatively disabled by 'autism' (whatever that is), low average IQ, schizophrenia, affective disorders and the like.

So this is old material, but I don't recall a theoretical framework explaining why child raising takes a larger and larger proportion of income as a society becomes wealthier. The answer, of course, is Baumol's cost disease.

Child raising is one of those tasks with minimal productivity increases. Indeed, as output requirements rise to meet the narrowing demands of a post-labor economy, productivity may be negative over time. Certainly much of the cost is related to education and health care, two domains with notoriously slow productivity growth. Baumol's work teaches us that as overall productivity and wealth increase, relatively low productivity labor will consume increasing fractions of total income.

This seems to be an obvious insight, but a cursory Google search didn't find any articles or posts connecting demographic transitions with Baumol's Cost Disease. Until now.

Corporate growth and the unexpected triumph of central planning

The American Economic Review tells us large corporations are taking up a larger share of our GDP ...

The American Economic Review, Vol. 21, No. 1, pp. 10-42

The Growth in the Relative Importance of the Large Corporation in American Economic Life

...  If recent rates of growth were to continue, 80 per cent of non-financial corporate wealth would be in the hands of 200 corporations by ...

... Six industries can boast of one or more "billion dollar" companies ...

Yeah, that said "billion", not "trillion". The article was published in March 1931, so it was presumably written after the crash of '29 but before the full horror of the Great Depression was recognized.

81 years later the Economist has an update:

Free exchange: Land of the corporate giants | The Economist 11/2012

... Businesses have also been getting bigger. A snapshot of the American economy shows huge dispersion in firm size: around a third of American workers are employed by one of the 6m small firms with fewer than 100 workers, and another third are employed by one of the 980 large firms that have over 10,000 workers. But the long-run trend seems to be towards bigger companies. In a 1978 paper Robert Lucas of the University of Chicago documented how average firm size in America had increased over a 70-year period (see left-hand chart)...

... In the past 15 years the assets of the top 50 American companies have risen from around 70% of American GDP to around 130% (see right-hand chart). All of the top ten American firms have been involved in at least one large merger or acquisition over the past 25 years...

...  If size does not keep driving down costs, why do big firms keep expanding? One possibility is that they are seeking to boost profits not by driving down costs but by raising prices. Buying up rivals softens competition and enables firms to charge more...

Accelerated consolidation seems like a predictable outcome of very low interest rates and very high risk aversion [1]; an unintended consequence of economic stimulus and at the zero lower bound. If so, it's a winner-take-all result in a political-economic tax, law and accounting environment fashioned by large corporations for large corporations.

Size can be used to purchase competitors, but it has many more non-market advantages. Size allows, for example, the capture of regulators and the purchase of legislators. Those advantages allow corporations to grow beyond the bounds of classic microeconomics.

And that,  surprisingly, is how we end up with the unexpected triumph of central planning. 

Central planning triumphs because, even if we ignore regulatory capture and senatorial acquisition, corporations are only capitalist on the outside of the cell membrane. Inside the corporation there are no contracts, no currencies, and no markets. Inside the corporation, we have the hallmarks of Soviet central planning - goals and quotas and commissars and imaginary numbers and dictates from the central commission.

Central planning, of course, has its issues. Persistent and eventually fatal issues. When very large corporations fail though, they take a lot of things down with them. If there are truly systemic dysfunctions associated with corporate size, and if large corporations now subsume a large portion of national economic activity, the impact of these weakened monsters may be considerable. 

See also:

• The Modern Firm - a review 4/2012
• Why do corporations (firms) exist? - Coase and the theory of the firm 10/2010
• Gordon's Notes: Global finance and parasites 9/2009
• The origins of corporate mediocrity - promoting the best 7/2009 - game theoretic limitations to corporate competence
• The Corporation - what next? 8/2010 - links to prior posts
• Troubled capitalism: The corporate entity 8/2010 - science fiction socialists attack
• Ants, corporations and the great stagnation 12/2011
• Speculation: The corporate ecosystem and American stasis 11/2010
• After the crash: The future of the publicly traded corporation 8/2008
• Self sustaining entities: corporations and the Spanish Inquisition 6/2006
• Malice, incompetence, and happy accidents 5/2011 - Classic Dilbert
• Kristof: The market failure of CEO Compensation 3/2004
• SBA.GOV document on small business recover (pdf) 1/2012

[1] Given the way American health care has worked, an aging population may also support increased corporate size.

The Right will drop Climate Change Denialism within the next six months

My prediction for 2013 - the American Right will effectively drop Climate Change Denialism by April of 2013. They'll never admit it of course. They'll act as though they always accepted that human activity was warming the earth and that effete Liberals have been responsible for all inaction.

This is a good thing.

Some may wonder how this could happen so quickly. I used to think it would take longer myself but I've changed my mind.

A year ago I thought this would only happen after a crushing GOP victory, but since then we've seen the GOP make a complete policy reversal on immigration. We've seen Christian evangelicals purge all record of decades of anti-Mormon sentiment. We've seen a hard-right primary candidate morph into an Obama-clone, and his base act as though nothing had changed. We've realized that the GOP elite often believe what they say, and believe they've always believed whatever they now believe.

If you are not anchored to data, and to reality, then it's not hard to change direction. The  U.S. military's preparation for climate change disruption (and climate engineering wars) will be tied to budget requests, and it's hard for the GOP to say no to increasingly large sums of military money. The combination of military requests, electoral defeat, and Sandy are sufficient to precipitate radical realignment.

Don't be shocked if a Carbon Tax, in one form or another, makes it into the 2016 budget process.

XMind: Impressions and comments on the mind mapping market

It's been two years since I first looked at XMind. During that time I used MindManager at work and experimented with MindNode Pro at home. I mostly use the tools to explore new terrain, and as a visual aide to some teleconferences (share the mind map while discussing).

MindManager wasn't ideal, but it was a decent tool when we could buy it for $100 or so. Their current pricing is too high for team use, and I really did want the option of sharing maps. So when I switched projects I also switched to XMind. I don't have time for a proper review, but I can share some bullet points on why I chose it, what it's like, and what I would love to see.

Why I chose XMind

• It runs on Windows 7 and it's nice I can also use it on my Air.
• Price: Free for a very solid version, upgrade to pro was $80 for me. I don't like free software, but we can't afford MindManager - so this freemium model is a good balance.
• Longevity: It's been on the market for several years and just went through a significant update.
• Quality: it's got bugs, but it's tolerable so far.
• It's a simplified clone of MindManager so it has a good feature set.
• The base version is "open source". A weak form of insurance, but could be worse.
• Freemind lacks the corporate look and seemed a steeper learning curve for non-geeks.

Impressions, including problems

• Data lock: The inevitable for all but Freemind
• Java: The UI is native, but the back-end requires Java. That's bad enough on Windows, but for a Mac user Java installation feels like installing a malware-welcome sign.
• There's no built-in Help, only web help.
• It is slow to load what I consider a mid-sized map.
• It is pretty reliable, but I have run into a significant bug with string search. Search sometimes fails unless the map is fully expanded.
• It's made in China, and the language localization is imperfect. "Extend" is used in place of "Expand" for example, and the mouse-over tooltip text is quaint.

Thoughts on the mind map / concept visualization marketplace

 

I've seen cognitive-support apps come and go for twenty years, and I don't think we're making much progress. We're shuffling in place. This definitely isn't a technology problem -- we had similar apps running on the computing-equivalent of medieval tech. I don't think it's due to lack of imagination, though that has occurred to me. I think it's a business problem -- the market for high-end cognitive-extension concept modeling software is tiny; probably not more than 1 in 10,000 adults, perhaps 300,000 worldwide on all computer platforms. If we then ask how many can/will pay $30 a year for a product … we're talking a modest income stream for 1-2 developers owning a world market.

 

Yeah, this is a business problem. So we're not going to get what I want through traditional market-driven mechanisms. We're going to have to figure a way to grow something from modest means, and it's going to have to be built atop something else.

 

So here's how I think it could work. Start with the standard data formats used in other apps like Notational Velocity for the nodes. That means UTF-8 including "plain text", RTF, and markdown with a simple title, tag, date/time and text metadata model. That way the "nodes" can live in a simple Spotlight/Windows Search indexed folder and can be used by SimpleNote or Dropbox.

 

Now put the graph structure as XML or XMLized RDF in just another note in the same folder with a special name.

 

Optionally, allow the folder to contain other files, images, and so on (future).

 

That's the data. Now the app reads in the RDF and the nodes and renders the relationships. Ideally many different apps work with the same data structure. There's very little income here, so we're taking labor-of-love with a bit of cash to pay for a new computer. From this base, over time, with full data portability, we can slowly build a concept-visualization ecosystem with full data freedom.

 

Anyone have other ideas?

See also:

• Gordon's Notes: XMind: Software made in China for OS X and Windows: 11/2010
• » Fix for Xmind missing icon bug. Gordon's shares
• Gordon's Tech: Mac Mind mapping software: Inspiration, OmniOutliner and MindNode 6/11: links to related topics and articles
• Gordon's Tech: Tinderbox, Simplenote, MindNode and data freedom 10/2011

iOS 6.01 Podcast app: Die, Apple, Die.

I had to update to iOS 6 sooner or later, and I knew that meant the Podcast app.

Still, a small part of me hoped that that it wasn't as bad as I heard.

Really, I was in denial.

It's true. All of my Podcast Playlists are gone.

Apple's share price is at 2001 levels -- really, that's not low enough.

Yeah, it's one tiny app that only a few geeks really use -- but we are the geeks that used Playlists and Smart Playlists. This is the kind of colossal screw-up that can't exist in isolation. It's worse than the infamous Maps mess because there Apple had a real business problem.

That podcast silence you hear is the dead canary.

And the big iTunes update is still supposed to be coming ...

Update: Listen to podcasts with Music app on iOS 6 - Mac OS X Hints says you delete the Podcast app and get Playlists back. I had to restart my iPhone with iOS 6.01 for this to work, but it did work.

Update 11/11/2012: After deleting Podcast.app and restarting video pod cats will again appear in Video.app. My kids like those.

Post-election reflection

I don't often pull down my posts for a rewrite, but this one was up for a few hours before I took it down for a rework. Here's the revised edition with a strikeout.
------
My team won the big one. I read my Talking Point, Krugman, and Salmon, so I wasn’t surprised. On the other hand, since I’m a bit mathic,  I wouldn’t have been surprised if Romney had won either. So not surprised, but very grateful.

My team won even bigger in Minnesota. Voter-ID, anti-gay marriage amendment, GOP State House – all gone. I didn’t expect all of that. So there I’m surprised, and very grateful.

I'm grateful to the Obama and Biden families, to Bill Clinton who may have earned some forgiveness for delivering himself to his enemies so long ago, to the Millenials who seem to like voting (and that will change many things), to all the Obama donors big and small, to my friends Kathy and Lin who won their fight, to Paul Krugman who rails against ignorance, to Obama voters, and especially to the campaign team. I listed to Obama’s acceptance speech, and some parts were obligatory filter – but his gratitude to his volunteers and campaign team was very sincere.

I'm also grateful that, despite some dire predictions, most of the white GOP voters I know seem to be going on with their lives without riot. Even those who claimed they'd go Galt may be sobering up, though there may be rare exceptions. It's as though they didn't entirely believe Fox/Rove TV. Certainly Boehner and McConnell didn't -- they went to bed early on election night.

I’m grateful, but I ain’t exactly joyous. I’m not sure entirely why, but it's not hard to list potential contributors.

First there was the tidal wave of stupidity that infested even commercial-free NPR as both parties fought for the allegiance of the inattentive, uninformed, and unmotivated. It felt like pledge week on steroids.

Then there was the partial success of the House GOP's scorched earth policy over the past two years, and the success of the GOP governors' redistricting policies that keep the House Red even when the nation goes Blue.

The GOP's voter suppression tactics were depressing -- and Florida is still a democracy disaster area. (It's time for a federal intervention). Romney's jaw dropping whoppers were much worse than McCain's -- and they never seemed to cost him all that much. His "budget plan" was a bad joke. Overall, the etch-a-sketch worked depressingly well. He ought to have lost by a huge margin, he lost by a few percent.

Dare I mention the billionaires? Yeah, we learned (again) that wealth is no measure of intellect or even cunning, but I suspect they did more harm than we are willing to admit.

Maybe it’s also a primitive tribal responsibility thing. Sadly, I am not a blue-eyed husky mix. Like John Scalzi, I am “the GOP “demographic” down to the last jot and tittle”. So, while I think it would be crazy for President Obama to feel depressed about black men behaving badly, I feel badly that so many of my tribe [2] of very-advantaged relatively-wealthy and somewhat educated white men behaved like fear-infested pithed fleshbots with an etch-a-sketch memory ... made very bad choices.

*Cough*. Yeah, that's the problem sentence. It's a bit ... harsh.

I'd like to know what's going on in the heads of my white folk tribe. To consider that let's set aside the elderly; they are vulnerable and easily manipulated. Let's set aside the cynical wealthy; for them Romney is a logical choice. Let's even assume that a fraction of the GOP (all white) base is truly opposed to abortion on genuine religious or ethical grounds -- and not just using 'pro-life' as a tribal flag. Set them aside. Lastly, set aside the less educated or the white impoverished who are disconnected from the world.[4]

That still leaves a large group of people who should know better, and whose justifications for voting for today's GOP [3] don't make sense. Except that 80% of GOP voters are overtly racist [1].

So maybe I don't really want to know what's going on in the heads of white male GOP voters.

I think I know why I'm not joyous. Grateful though.

[1] I know at least white GOP voter who isn't, and who was still convinced Obama would destroy America. She may be in the same mysterious category as black Republicans.
[2] Really I have several tribes, but I can't escape the male and pigment-deficient one.
[3] Some have stated reasons, but they are either data-free or contradicted by simple data. This doesn't mean it's impossible to rationally vote for any Republican candidate, just not the ones we have now.
[4] GOP voting Libertarians don't get exempted because today's GOP is less "Liberty" friendly than today's Dems. A third party vote is absolutely defensible however.

Apple drive replacement program notification error sends blogger over edge

Update: I got an unexpected Apple email requesting I send a scanned receipt and bank information to get my iMac drive replacement refund. I thought I'd solved this problem two weeks ago!

So I wrote a snarky blog post (below) and replied with a crabby comment. About 30 minutes later I got a f/u email:

Dear Apple Customer,
The prior communication you received from Apple stating the need for additional information was in error.
We completed your refund for a hard drive replacement as part of the iMac 1TB Seagate Hard Drive Replacement Program.
Refund Amount: 281.25
Credit Memo Number: 111111
Case ID: 11111
Follow Up Number: 111111
You will receive your refund in four-to-six weeks.

So it was a mistake. I wonder how many customers got this, and how many are as cranky and post-election sleep-deprived as I am (and my team won, imagine how cranky I'd be if I voted GOP).
-------------------------------
Original title: Apple's defective drive replacement program: lousy customer service

I wasn't delighted that Apple took a year to admit that my iMac's hard drive was defective, but I was glad to apply for a refund for the replacement I purchased. I received an email asking for bank details, which I sent on.

Today Apple sent me another email asking again for the bank details I'd already sent and for a scanned receipt for a repair that was done by Apple at their store over a year ago:

Dear Apple Customer,
Product Serial Number(s): XXXXXX

Case ID: 11111
Follow Up Number: 1111
Thank you for submitting a refund request. We need a repair receipt and banking details to complete your refund.
Please contact the service center that replaced your hard drive and obtain a receipt, if you do not already have it.
Reply to this email and attach a scan of the receipt. Do not change the subject line.
...
sg1tb_refunds_amr@apple.com

This is lousy customer service.

Update: I asked on Apple's discussion board if others had run into this problem. The post was removed about twenty minutes later, and I received this note:

Apple removed your post titled, "iMac 1TB drive replacement program: Apple gets nasty about refund," because it contained the following:
Non-technical posts
Non-constructive rants or complaints

Well, no complaint there - 'nasty about refund' wasn't the smartest subject line. Still, that was a pretty fast deletion by the standard of past years.

MacBook Air vs. iPad: waiting for the keyboard

When I travel for business I want to have a personal device with a keyboard and 1024+ horizontal resolution in addition to my obligatory corporate laptop. 

I am quite fond of my MacBook Air 11", but it has several limitations for this use case:

1. The power adapter is compact, but still on the large side of portable life.
2. The battery is only good for about 4 hours of use with WiFi enabled.
3. I can't sketch on it.
4. The OS and software suite "expects" unlimited high speed net access.
5. Many OS X apps and especially "non-mobile" web sites are designed for larger than 11" Air screens or expect (yech) Flash.
6. OS X calendar/contact/task software don't sync as well with ActiveSync servers as iOS.
7. Although the Air is very compact, it is a tight fit next to my massive corporate WinTel box

I believe, once the keyboards come out, that the iPad Mini solves these problems:

1. The power adapters is very compact. Since I have to carry a similar adapter for my iPhone it is arguably non-existent.
2. Ten hour battery life.
3. Sketchable
4. iOS runs on ARM and is designed for a power and data constrained environment. (non-Retina screen is a feature here, not a defect.)
5. Apps I use especially web browser and sites fit device specs.
6. iOS is a decent ActiveSync cient.
7. The iPad Maxi with Logitech kb is about the same size as my Air, but the Mini is significantly smaller. On the other hand, there's no Logitech kb for the Mini and no commitment to make one.

I think a Mini purchase meets Gordon's Laws of Acquisition, even without considering its use in other contexts such as a personal device at the office, and as an eBook reader. It might eventually turn my Air into a family machine with an external monitor. The key test though is keyboard support, so I need to play with the Mini at the Apple store and wait until a good case/KB solution emerges.

Minor things that drive me nuts: iCloud is not an improvement over MobileMe

In an otherwise uncontroversial rant about Apple's net service reliability failures I came across a glaring bit of conventional stupidity ...

When is iCloud going to be more reliable? — Erica Ogg

... To be fair, iCloud has been a massive improvement over MobileMe...

No, iCloud hasn't been an improvement. I suspect Erica never used MobileMe, so she's only repeating what she's read elsewhere.

I used MobileMe, and I've used iCloud. MobileMe was very unreliable when it launched, but by the time it ended it was fairly reliable at what it did across both Windows and Mac clients. In part this was because a lot of bugs had been wrung out of the clients and because Apple stopped adding features.

iCloud was a major regression for MobileMe users, not least because Lion was a wreck. Even under Mountain Lion it's probably not as reliable as MobileMe was towards the end -- when Apple stopped trying to sell it.

So will things get better? I'm optimistic, because Apple's share price has been falling as the company is pummeled by bored journalists and geeks alike. This is a good thing; suffering helps humility, and humility may lead to new thinking on customer service and reliability. We don't need radical changes to OS X -- Mountain Lion is a good enough platform for at least another decade. We do need reliability, and thoughtful improvements.