via The Baltimore Sun


Baltimore Inner Harbor from Federal Hill – photo by ktylerconk on Flickr

Frustrated by Maryland’s high rate of health disparities, state leaders are proposing a new attack — one more commonly associated with economic development. Gov. Martin O’Malley’s 2012-2013 budget will include funding to create Health Enterprise Zones, where doctors and community groups in areas with large health disparities, such as Baltimore, could add medical and support services for minorities. Tax credits and other financial incentives would be available to spur interest.

The plan is designed to save lives and healthcare dollars, according to Lt. Gov. Anthony G. Brown, who last summer formed a work group on disparities led by Dr. E. Albert Reece, dean of the University of Maryland School of Medicine.

“Maryland has world-class hospitals, top medical schools and one of the highest rates of primary-care physicians per capita, and yet we continue to see disparities in health care and outcomes among Maryland’s racial and ethnic communities. It’s clear that a lack of access to primary care in many communities is a significant factor driving these disparities,” Brown said, adding that funding is in the governor’s budget proposal, which has yet to be released.

According to state and national data, the disparities are many: In Maryland, the infant mortality rate among blacks is almost three times that for whites, the incidence of new HIV infections among blacks is almost 12 times that of whites, and Hispanics are more than four times as likely not to have health insurance as whites. Moreover, nearly twice as many African-Americans suffer from diabetes as whites, and hospital admission rates were three times higher for blacks with asthma and 41/2 times as high for blacks with hypertension. Treating such illnesses is costly, according to the work group, which cited data showing nearly $230 billion in direct medical costs could have been saved from 2003 to 2006 if there were no racial and ethnic health disparities.

The proposed program would work something like economic enterprise zones, where businesses receive subsidies to create jobs and activity in certain areas. The health zones program would be a pilot, available in two or three geographic areas. New and existing primary-care practitioners could receive loan assistance repayment; income, property or hiring tax credits; and assistance in installing health information and other technology. Subsidies would be capped, likely in the tens of thousands of dollars. Local health departments might get involved in recruiting participants.

Brown said he would push to expand the program statewide if it proves successful in a couple of years — not a given, considering the logistical and cultural complexity of the problems. For example, residents of some neighborhoods don’t have easy access to grocery stores that sell fresh fruit and vegetables, or don’t visit the doctor until there is an emergency. Reece said many groups have tackled disparities, but the work group wanted to focus its attention on chronic diseases responsible for 80 percent of health costs. They drilled down to a few key maladies that often have “ripple” effects. They include diabetes, hypertension and asthma.

“We decided to identify … areas where we thought we could make an effective impact within a reasonable time frame,” he said. The health enterprise zones approach is unique, he believes. Work group members got the idea from a similar program built around children’s needs in the community of Harlem in New York City. Program applicants are likely to come predominantly from rural and urban area where disparities are most pronounced.

In Baltimore, studies show a 20-year gap in life expectancy between upper-income, predominantly white neighborhoods and poorer, predominantly minority neighborhoods. Recently, city health department officials began working with community leaders in 55 neighborhoods to identify the most pressing health needs and develop plans to tackle them. The state’s zones would complement these efforts, Reece said. His work group also proposed other elements to promote health and track outcomes.

The group suggested Health Innovation Prizes with small financial rewards and public recognition for individuals and groups that improve health and well-being in their community. The group also recommended tracking disparity data for programs that already exist for primary care physicians and hospitals. Incentives and penalties assessed through these programs could eventually be linked to disparities.

Reece said the prize and the enterprise zones are two things Maryland can do now to help reduce disparities in a few key geographic and health areas. If legislation to create the zones is passed during the current legislative session, the details will be worked out by the state Department of Health and Mental Hygiene.
Already, Dr. Joshua M. Sharfstein, department secretary, supports the move: “The creation of Health Enterprise Zones will help communities target resources to have the most powerful impact.”

meredith.cohn@baltsun.com

Coinciding with Veteran’s Day, a number of new initiatives were announced to help put veterans back to work. Here are a few resources for communities with large military operations, as well as veterans returning home.

President Obama has announced a new initiative to support veterans looking to return to the workforce. The Returning Heroes Tax Credit provides firms that hired unemployed veterans with a maximum tax credit of $5,600 per veteran. The Wounded Warriors Tax Credit offers firms that hire veterans with service-connected disabilities a maximum credit of $9,600.

Indeed.com and Google also launched products aimed at supporting the veteran community this month. At military.indeed.com, veterans can now enter their Military Occupational Code (MOC) to search for civilian jobs on Indeed that match their skills and experience. In a similar spirit, Google launched a Veterans Job Bank in partnership with the Department of Veterans Affairs.



These initiatives are timely in light of the Bureau of Labor Statistics report that put the unemployment rate for veterans who served in the military at any time since September 2001 (known as Gulf War-era II veterans) at 11.5% in 2010 (as compared to 8.7% for all veterans and 9.4% for nonveterans). Additionally, about 25% of Gulf War-era II veterans reported having a service-connected disability, compared with 13 percent for all veterans.

In a recent National Public Radio (NPR) report veterans describe a job market that presents some unique challenges. These challenges include a generation of managers who are less likely to have direct military experience (and therefore less likely to fully comprehend the range of skills veterans bring to the job) and the fact that some military qualifications do not automatically transfer to the private sector. However, David Loughran, senior economist at the Rand Corporation, goes on to describe how veterans actually have an employment advantage over the long run, including lower unemployment levels than civilians (8.7% vs 9.4%).

via NYTimes, By BARRY MEIER and JANET ROBERTS

One afternoon last spring, a little-known congressman from Minnesota made an impassioned plea before a House oversight committee.

Rein in the Food and Drug Administration’s uncertain approval process for new medical devices, urged the Minnesota congressman, Erik Paulsen, or Minnesota and other states stand to lose up to 400,000 jobs because of lost investment in the device industry.

Over the following month, Mr. Paulsen’s campaign committee took in $74,000 from people with a stake in device regulation, much of it from executives affiliated with venture capital funds and their spouses. Now Mr. Paulsen, a two-term Republican, is a sponsor of a bill that would make it easier to bring new medical products to market.

As Congress considers reauthorizing a law that sets the fees for medical device makers, venture capitalists are emerging as a rich and influential ally of device companies eager to remove what they say are regulatory roadblocks in the approval process. The push has alarmed patient advocates and some doctors, who have been calling on the F.D.A. to intensify its oversight of devices, particularly in light of some all-metal artificial hips that are failing prematurely at an unusually high rate.

“They have this unwritten assumption that every new device is innovative,” Dr. Rita Redberg, who is the editor of the Archives of Internal Medicine, said, referring to the venture capital funds. But some devices, she said, “are killing people or causing significant harm.”



People associated with funds that underwrite companies developing new devices and other health products have made more than $3.3 million in political donations to Republicans, Democrats and political action committees over the past five years, according to an analysis of federal contributions by The New York Times.

Though such people donate for many reasons, about 20 percent of the money from the 182 donors identified by The Times went directly to candidates and political action committees supporting a streamlining of F.D.A. policy or other issues of importance to medical products producers. The total contributions from such donors could be much higher; The Times limited its analysis to individuals affiliated with venture capital funds that have joined two lobbying associations.

Investment funds and business groups have also increased their lobbying in Washington and have generated a stream of reports arguing that regulations are crippling innovation and driving away investment.

Simply put, the industry’s champions argue that the F.D.A. suffers from high personnel turnover, an unwieldy bureaucracy and a regimen that forces start-up device companies to run new and costly tests constantly, often duplicating past efforts.

“This is about survival,” said Michael Carusi, a general manager at an investment fund in Palo Alto, Calif., Advanced Technology Ventures, who contributed $1,000 to Mr. Paulsen. “We are deeply concerned about the future.”

Medical devices encompass a wide array of products, such as heart defibrillators, artificial joints and diagnostic equipment.

Lobbying to smooth the approval process has intensified over the last year as Congress prepares to reauthorize the law that requires device producers to pay fees to the F.D.A., fees that are used to pay the agency’s operating costs. Lawmakers have an opportunity to alter the agency’s regulatory procedures for the first time since the law last came up for renewal in 2007.

An industry lobbying group, the National Venture Capital Association, has intensified its focus on device regulation. In 2010, the association, which lobbies on many issues, spent more than $2.5 million, according to data from the nonpartisan Center for Responsive Politics. About $350,000 of that was related to devices, drugs and health care, a figure that is expected to increase to $450,000 this year, said an association spokeswoman, Emily Mendell.

While it is not unusual for businesses to point to regulation as a barrier to economic and job growth, medical device investors have found a particularly receptive audience on Capitol Hill in recent months. In October alone, 10 bills have been introduced by Republicans in the House to speed up the F.D.A. device approval process; in the Senate, similar legislation has been introduced by Amy Klobuchar, a Democrat of Minnesota.

Since February, four House panels have held hearings on the impact of F.D.A. procedures on device approval. At those sessions, 19 of the 26 listed witnesses were investors, entrepreneurs, industry consultants, trade group officials or patients who said that agency delays in approving a device had harmed them or a loved one. The list included no patients injured by a flawed device; one hearing in the Senate had a more varied witness list. Two weeks ago, four Democratic congressmen wrote to their Republican counterparts about the imbalance in the House testimony and suggested the hearings had failed to address potential dangers “if medical devices are not appropriately regulated.”

The letter, signed by Henry A. Waxman of California, Diana DeGette of Colorado, John Dingell of Michigan and Frank Pallone of New Jersey, also urged that hearings be held on the metal hip problem and similar issues.

Venture fund executives like Mr. Carusi and lawmakers like Mr. Paulsen insist that they are equally concerned about safety. However, in their view, a big part of the problem at the F.D.A. is philosophical; top officials, these critics say, have overreacted to recent episodes involving flawed products and become risk-averse. As a result, devices are available first in Europe, they say.

“The key is to strike the right balance,” said Dr. Josh Makower, a device developer and a consultant to New Enterprise Associates, a venture fund in Palo Alto.

F.D.A. officials said they have recently tried to address investors’ concerns by announcing programs to encourage innovation and reduce regulatory burdens. Still, the head of the agency’s device division, Dr. Jeffrey E. Shuren, said that executives like Dr. Makower seemed more interested in politicizing the issue than resolving it through discussion.

“The dialogue has become more political and adversarial,” Dr. Shuren said.

Some medical experts have also questioned recent studies about the negative impact of regulations, calling the reviews flawed in methodology.

William Vodra, a lawyer in Washington who has worked closely with medical device producers, said that investors had legitimate concerns about regulatory speed. That is because the approval of a new device can begin a process in which a start-up company is acquired by a larger manufacturer and early investors profit by cashing out.

But such investors may be less interested in what happens to that device after it reaches the market because they have already moved on, said Mr. Vodra, who served on an Institute of Medicine panel that recently concluded the F.D.A. failed to properly assess the safety and effectiveness of many new devices.

Mr. Paulsen, the Minnesota congressman, did not respond to requests for an interview. But a spokesman, Tom Erickson, said that the lawmaker’s testimony this spring was unrelated to any campaign donations and reflected his long-held view that the F.D.A. was undermining an industry crucial to Minnesota.

“He gave his testimony because he feels these jobs are being threatened by an inconsistent and unpredictable F.D.A.,” Mr. Erickson said. Mr. Paulsen, along with Democrats and Republicans from states that are home to device makers, has also sought to repeal a tax on sales imposed on the industry under the health care overhaul law.

Dr. Makower, the venture fund consultant, has donated $5,000 to Mr. Paulsen, records show.

“I think that he understands this issue,” said Dr. Makower.

via NYTimes Bits Blog
by: Jenna Wortham

The battle royale brewing between New York and Silicon Valley to be the nation’s dominant epicenter for tech innovation and hot start-ups wages on. On Monday night in downtown Manhattan, Paul Graham stood before a packed auditorium of 800 entrepreneurs, developers, programmers and others who were curious about what makes a city a fertile environment for a thriving community of start-ups. Mr. Graham is a well-known investor and esteemed figure in Silicon Valley because he created Y Combinator, an incubator in Mountain View, Calif., that has given seed money and mentorship to start-ups.

At the Y Combinator event, Mr. Graham raised the question of the sustainability of New York’s future as a hotbed of technology innovation and whether the city could ever grow to rival Silicon Valley.

“The truth is that I don’t know what’s going to happen,” he said. “Hubs tend to stay hubs.”

Mr. Graham gave the keynote talk for the evening, but also welcomed several Y Combinator alumni to the stage, including Sam Altman of Loopt, Alexis Ohanian of Reddit and Joe Gebbia of Airbnb. Mr. Graham kidded that his speech could have been titled “On the Other Hand,” because for each theory he had about why New York, a decade after the dot-com bust, was springing back to life and whether it could give rise to the next Facebook or Google, he had a counterpoint to rival it.

He said that geographically speaking, there were several elements that contributed to a healthy ecosystem to nurture young start-ups. After all, he acknowledged, most start-ups don’t make it past their infancy.

“But places aren’t sprayed with start-upicide,” he said. “A start-up needs keys to success.”

He noted that New York, like Silicon Valley, had the same density of tech-savvy people working in similar industries required for the kinds of happenstance encounters and introductions that could revive a company’s flailing fortunes and help right its trajectory.

He recalled the serendipitous sidewalk meeting of Mark Zuckerberg and Sean Parker, the founder of Napster, who helped shape Facebook in its early days and became its founding president.

“The antidote for a failing start-up is Sean Parker,” he said.

However, Mr. Graham also said that New Yorkers tended to prize making money above all other goals — which could prove to be advantageous or disastrous for a fledgling company or business idea.

“The Valley is a magnet for nerdy visionaries,” he said. “New York is for rapacious deal makers.”

Mr. Graham went on to list a few other factors that detract from New York’s viability, including the distractions of city life and other, more lucrative industries, like Wall Street, along with the Valley’s perennially sunny climate.

But he did note that New York had surpassed Boston, long considered a nexus of technology and start-up culture.

“New York is solidly No. 2 right now,” he said.

New York, Mr. Graham said, was ripe for the kinds of companies that can disrupt and transform some of the city’s legacy businesses, like fashion, advertising and finance. Whether or not they can give rise to a large-scale technology company along the lines of Google and Facebook, he said, remains to be seen for now.

However, even Mr. Graham isn’t immune to the siren call of the hot start-ups cropping up in the boroughs of New York. Although he said he had no plans to bring a version of his incubator to the East Coast, like Ron Conway, a lauded angel investor, and Accel Partners, a well-known investment firm, who each have turned a keener eye to New York in recent months, Mr. Graham did say that he hoped to lure more New Yorkers to the annual Y Combinator start-up class.

But for those entrepreneurs who are accepted into Y Combinator and, after finishing their three-month incubation period, want to move back to New York? He wishes them the best of luck on their journey.

“I don’t try to stop them,” he said.

via NYTimes




When the unemployment rate rose in most states last month, it underscored the extent to which the deep recession, the anemic recovery and the lingering crisis of joblessness are beginning to reshape the nation’s economic map.

The once-booming South, which entered the recession with the lowest unemployment rate in the nation, is now struggling with some of the highest rates, recent data from the Bureau of Labor Statistics show.

Several Southern states — including South Carolina, whose 11.1 percent unemployment rate is the fourth highest in the nation — have higher unemployment rates than they did a year ago. Unemployment in the South is now higher than it is in the Northeast and the Midwest, which include Rust Belt states that were struggling even before the recession.

For decades, the nation’s economic landscape consisted of a prospering Sun Belt and a struggling Rust Belt. Since the recession hit, though, that is no longer the case. Unemployment remains high across much of the country — the national rate is 9.1 percent — but the regions have recovered at different speeds.

Now, with the concentration of the highest unemployment rates in the South and the West, some economists wonder if it is an anomaly of the uneven recovery or a harbinger of things to come.

“Because the recovery is so painfully slow, people may begin to think of the trends established during the recovery as normal,” said Howard Wial, a fellow at the Brookings Institution’s Metropolitan Policy Program who recently co-wrote an economic analysis of the nation’s 100 largest metropolitan areas. “Will people think of Florida, California, Nevada and Arizona as more or less permanently depressed? Think of the Great Lakes as being a renaissance region? I don’t know. It’s possible.”

The West has the highest unemployment in the nation. The collapse of the housing bubble left Nevada with the highest jobless rate, 13.4 percent, followed by California with 12.1 percent. Michigan has the third-highest rate, 11.2 percent, as a result of the longstanding woes of the American auto industry.

Now, though, of the states with the 10 highest unemployment rates, six are in the South. The region, which relied heavily on manufacturing and construction, was hit hard by the downturn.

Economists offer a variety of explanations for the South’s performance. “For a long time we tended to outpace the national average with regard to economic performance, and a lot of that was driven by, for lack of a better word, development and in-migration,” said Michael Chriszt, an assistant vice president of the Federal Reserve Bank of Atlanta’s research department. “That came to an abrupt halt, and it has not picked up.”

The long cycle of “lose jobs, gain jobs, lose jobs” that kept Georgia’s unemployment rate at 10.2 percent in August — the same as it was a year earlier — is illustrated by Union City, a small city on the outskirts of Atlanta.

It suffered a blow when the last store in its darkened mall, Sears, announced that it would soon close. But the city had other irons in the fire: a few big companies were hiring, and earlier this year Dendreon, a biotech company that makes a cancer drug, opened a plant there, lured in part by state and local subsidies.

Then, this month, Dendreon said it would lay off more than 100 workers at the new plant as part of a national “restructuring.”

Union City, with a population of 20,000, now calls itself the place “Where Business Meets the World” and has been trying to lure companies by pointing out its low business taxes, various incentive programs and proximity to Hartsfield-Jackson Atlanta International Airport.

Steve Rapson, the city manager, said that the challenge there, as in much of America, has been to get employers to hire again. “It’s hard to get your mind around what can you do as a city to encourage future jobs and jobs growth,” he said.

The reordering of the nation’s economic fortunes can be seen in the Brookings analysis, which found that many auto-producing metropolitan areas in the Great Lakes states are seeing modest gains in manufacturing that are helping them recover from their deep slump, while Sun Belt and Western states with sharp drops in home values are still suffering. The areas that have been hurt the least since the recession, the study said, rely on government, education or energy production. Places that were less buoyed by the housing bubble were less harmed when it burst.

In Pennsylvania, the analysis found, the Pittsburgh area — which is heavily reliant on education and health care — is weathering the downturn better than the Philadelphia area. In New York, areas around long-struggling upstate cities like Buffalo and Rochester are recovering faster by some measures than the New York City metropolitan area. And the rate of recovery in Rust Belt areas around Youngstown and Akron, two Ohio cities that were hit hard, has outpaced that of former boomtowns like Colorado Springs and Tucson.

In a sign of how severe the downturn has been, the Brookings analysis found that only 16 of the nation’s 100 largest metropolitan areas have regained more than half of the jobs they lost during the recession.

The toll on the nation’s millions of unemployed people has been harsh, with the Census Bureau reporting that the United States had more people living in poverty last year than in any year since it began keeping records half a century ago.

Joblessness is taking a toll on states, too. This month, 27 states will have to pay $1.2 billion to the federal government in interest on the $37.5 billion that they borrowed in recent years to keep paying unemployment benefits.

What is most striking about the high unemployment rates, several economists said in interviews, is how they continue to afflict wide parts of the country.

“It just seems to be so pervasive across the country — except for the breadbasket area — that it’s hard to pick out anybody who is bouncing back,” said Randall W. Eberts, the president of the W. E. Upjohn Institute for Employment Research in Michigan.

Dr. Eberts pointed to another feature of the downturn: people are much less likely to leave their jobs voluntarily. Before the recession, he said, about three million people voluntarily left their jobs each month. Now, around two million people do — leaving fewer openings for job seekers.

So what happened in South Carolina? Richard Kaglic, a regional economist at the Federal Reserve Bank of Richmond, Va., said the state’s lingering troubles reflect what happened when its construction and manufacturing industries were hit hard by the recession. Mr. Kaglic, who is also a pilot, used an aviation metaphor to explain what he meant.

“If your nose is high, if you’re climbing faster and your engine cuts out, you fall farther and it takes you a longer time to recover,” he said. “The conditions we experienced in late 2008, 2009, are as close as you come to an engine-out situation in the economy.”

But Mr. Kaglic said that the recent return of manufacturing jobs was giving him hope, and that one reason for the high unemployment rate was that more people were now seeking work.

“I would look at it as our dreams are delayed,” he said, “rather than our dreams being denied.”

Now, more than ever, prospects for “green jobs” are being treated as a red flag in partisan debate.

Media Matters, a nonprofit watchdog group, has documented a Fox News report proclaiming that the costs of green jobs exceed the benefits. A recent New York Times article, pointing to lackluster programs in California, concluded that “public efforts to stimulate creation of green jobs have largely failed.” A column by David Brooks in The New York Times was pointedly titled “Where the Jobs Aren’t.”

In reaching for bipartisan support in his jobs speech on Thursday, President Obama avoided the word “green” altogether, though his proposed increase in infrastructure spending could involve investments in improved energy efficiency.

But green jobs still hold considerable promise. While it’s not hard to find examples of programs that haven’t lived up to expectations, considerable evidence demonstrates the actual and potential employment impact of efforts to improve environmental sustainability.
Not that green jobs are easy to define. The Bureau of Labor Statistics is currently in the process of developing an official measure, but employment that either saves energy or increases use of energy generated from renewable sources clearly falls into the category.

In February, the Economic Policy Institute and the Blue-Green Alliance released a comprehensive analysis of the employment impact of American Recovery and Reinvestment Act expenditures aimed in this direction, dominated by efforts to improve energy efficiency in buildings and to promote low-carbon transportation.

The study estimates an increase in direct employment of about 367,000 jobs, while indirect employment effects came to about one million – not a cure-all for an economy with more than 14 million unemployed, but a significant contribution.

The cost per job created varied considerably, and not all programs have moved forward as quickly as they should have. But as a report from Think Progress carefully documents, sensationalized assertions of a million dollars or more spent per job are misleading. Overall, the costs of green jobs creation, whether funded with public or private dollars, are lower than those in most other sectors of the economy, at an average of about $60,000 each. These jobs are likely to last for years, generating private cost-savings and important public benefits.

Retrofits to improve the energy efficiency of our existing building stock offer a particularly high rate of return.

A recent Brookings Institution report calls for broader attention to “clean jobs,” defined as those in establishments that produce or add value to goods and services with an environmental benefit, such as reducing pollution or natural resource depletion.

By this definition, the clean economy is a pretty small slice of the United States economy, accounting for only about 2 percent of all jobs. But it’s now bigger than the dirtiest slice, related to production of fossil-fuel based energy.

The analysis by Brookings of employment trends on the county level between 2003 and 2010 shows that jobs in wind energy and solar photovoltaics represent a small but rapidly expanding part of the larger clean economy.

The report also points to a growing share of private venture capital moving in this direction: 16 percent in 2010, from 2 percent in 1995.

So why not rely entirely on the private sector? The biggest gains from investments in new renewable-energy technologies are not easily captured in private transactions, because they produce environmental services that are largely unpriced. Companies can sell consumers with a conscience a “share” in global greenhouse gas reduction – that’s what the growing business of carbon offsets is all about. But consumers who don’t pay also get the benefits, creating a strong temptation to free ride.

Companies can’t market to the consumers likely to benefit most, because they haven’t yet been born. Conventional fossil fuels are cost-effective now only because the environmental costs are dumped into a global commons that imposes costs on other people and future generations.

Public policies could remedy this problem, by imposing a tax on carbon emissions so that their market price better approximates their social cost. Adopting clean-energy standards would also increase demand for clean and green production, giving private companies greater incentive to invest.

The Brookings report explains that Germany, carrying out such policies, attracted investments from major American corporations including Google, First Solar and Good Energies. Between 2004 and 2009, German employment in renewable energy increased to more than 300,000 from 160,000.

Globally, the green jobs numbers look pretty strong. Unfortunately, in the United States, the possibilities for bipartisan collaboration still look very weak. Flag-waving is so much easier.

via NYTimes
By NANCY FOLBRE
Nancy Folbre is an economics professor at the University of Massachusetts Amherst.