BuckeyeBlog

A study recently completed for the State of Ohio by the Urban Institute calls for higher taxes and changes to benefits to ensure the solvency of Ohio’s unemployment insurance fund, according to a report (subscription only) by Gongwer News Service:

The Institute suggests the tax base be increased in 2009 and weekly benefits frozen from 2009-2011. The report recommends that Ohio raise UI taxes rates and peg them to wage growth.

The Institute also recommends ways the state should change access to benefits. Those are: reduce the restrictiveness of monetary eligibility requirements; eliminate dependents’ benefits; and broaden the beneficiary base by adopting short-time compensation (STC or worksharing) and self-employment assistance (SEA) programs.

Indeed, the state should change access to benefits. But access to benefits is only part of the problem. The bigger problem is how efficiently beneficiaries use those funds once they obtain access, which is determined by the incentives the unemployed face in choosing to use their benefits. George Leef of the Mackinac Center came up with a promising way to change both the source of unemployment benefits and the incentives that drive their use well over a decade ago, but his recommendations are still just as potent today.

The Enquirer reported on Drake Hospital’s recent turnaround over two weeks ago, but it is a story worth revisiting for further thought:

Three years ago, the long-term rehabilitation hospital was losing more than $10 million a year, slightly less than Hamilton County taxpayers were pumping into it annually to keep the facility afloat. Its costs were 70 percent higher than those of other hospitals. Its chief executive officer was making more than $400,000. Meanwhile, the center was operating at 45 percent of capacity and its supporters lived in fear it would close.

Drake’s only hope was to take a dose of strong medicine. In 2005, Hamilton County commissioners ceded control of the center to the Health Alliance. The old board was dismantled, the administrative team fired, employee benefits slimmed down, and its budget and admissions policies overhauled.

The privatization not only stabilized the care center, it saved it. Now center administrator Karen Bankston, senior vice president at Drake for the Health Alliance, predicts a $9 million surplus by the end of the fiscal year. Equally important, the center has bumped up admissions and is hoping to open its doors to hundreds of Iraq war veterans with brain injuries and land a highly coveted Department of Defense contract for their care.

Alliance officials say the turnaround has been so successful that they’ll no longer need public funds after a Hamilton County operating levy expires next year.

The Drake story offers yet more evidence that private health care is superior to the public health care systems endorsed by certain major presidential candidates. May it serve as a candle, however dim, for an American public currently stumbling around in the dark when it comes to effective health care solutions.

The latest “stimulus” plan from the Strickland Administration proposed taking ‘excess revenues’ (oh, what wonderful doublespeak!) from the Turnpike and spending on things like historical building renovation and corporate welfare enticements to Ohio businesses to hire more interns.

We’ve written about leasing the Turnpike (here and here) the $6 billion of dollars it could put into the Ohio economy stimulating growth though both direct expecture flows but also through the windfall of true infrastructure investments.

Instead of paying interest on bonds, the state would be collecting interest from a private Turnpike operator.

Now that’s a better idea!