PERSPECTIVE: Insurance Company Mergers - Why Patients and Consumers Will Not be Better Off

by Frances Padilla Many Connecticut residents still don’t know that by the end of this year, Anthem Insurance Co. and CIGNA may merge—forcing us all into a dire situation.

Anthem currently provides health insurance to about 1.1 million state residents and CIGNA covers just short of half a million.  If the proposed Anthem-CIGNA merger is approved, the resulting mega-insurer will cover 64 percent of covered lives in Connecticut.  Anthem and CIGNA have policyholders in 27 states.

Additionally, Aetna, with a Connecticut enrollment of about 500,000, is proposing to merge with Kentucky-based Humana, and recent news accounts speculate that it is contemplating moving its headquarters out of Connecticut.

We at Universal Health Care Foundation have been tracking these mergers since last June.  The plans were made public shortly after the King vs. Burwell Supreme Court decision.  That decision, upholding the subsidies in the Affordable Care act, was a big win for consumers.

However, it was also a big win for insurers; as Wendell Potter pointed out in his blog post.  Since then, the merger proposals were submitted for approval to the Federal Trade Commission and individual states’ departments of insurance. The United States Department of Justice also has to rule on monopoly implications of the mergers.

In a letter to the Antitrust Division of the DOJ, the American Antitrust Institute states, “The acquisitions are troubling for two important reasons.  They are likely to substantially lessen competition in numerous health insurance markets in the U.S., to the detriment of consumers. And, crafting relief that would adequately protect consumers is inherently difficult.”

Mergers are justified on the basis of increased efficiency and opportunity for innovation, but past experience doesn’t uphold those claims. The Anthem-CIGNA proposal should be carefully questioned, because it can be expected to increase health insurance premiums, and cause deductibles, co-pays, and co-insurance out-of-pocket costs to spike.

Cost is already a major reason why consumers put off care. A Consumers Union poll found that costs are a “top of mind” worry for consumers, whether they are insured or not.  Thirty-five percent of respondents reported relying on home remedies or over-the-counter drugs instead of going to see the doctor when sick. Another 27 percent did not fill a prescription for needed medicine.

The Kaiser Family Foundation reports that for Connecticut, the average combined employee contributions to health insurance and deductibles doubled from 4.2 percent of income to 8.8 percent between 2003 and 2013, as a percent of median household income.  Workers are faced with increasing cost-sharing shifted to them by employers, many of whom are self-insured, and contract insurers to provide administrative services.  The use of high deductible plans, widely viewed as “under-insurance,” has taken off.

The Foundation has been using the image of two sumo wrestlers with the consumer and patient caught between the insurers and the hospitals. Hospitals merge, develop new revenue centers, acquire physician practices and create mega-systems with bargaining power over insurers.  And insurers merge to gain bargaining leverage, creating monopolies to protect the value of their stocks and meet shareholder expectations. Meanwhile, patients and consumers are left bereft of necessary care and shouldering the burden of medical debt.

https://youtu.be/eTRXFzb_U6c

Final resolution of the insurer mergers is in a holding pattern.  No one knows when the DOJ will rule on the antitrust issues, though. It may be in the next few months. Most state insurance commissioners are waiting for that decision to render theirs.  Some state statutes require public hearings, but most don’t.

Some observers think “all eyes are on Connecticut” with how the Anthem-CIGNA merger is handled here, given the market concentration that can be expected.  Connecticut statutes require our insurance commissioner, Katherine Wade, to evaluate the financial solvency of the merging companies and the benefit to policyholders.  She is a national leader among insurance commissioners and faces some criticism here for her refusal to recuse herself, given her ties to CIGNA.

The Department of Insurance is not required by statute to consider the impact of a proposed merger (or of rate hike increases) on affordability to policyholders.  Public hearings held in the past have been held at times and locations inaccessible to most consumers. They do accept testimony online, but few people provide it.

It is not yet clear when there will be a public hearing called in Connecticut. We do know that there has to be 30 days public notice.  And we have been told that there is interest in hearing from consumers, health care providers and employers.

Contact us if you want to have your voice heard by state officials, and join us to make sure people’s interests are put first.

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Frances Padilla is President of Universal Health Care Foundation of Connecticut

PERSPECTIVE commentaries by contributing writers appear each Sunday on Connecticut by the Numbers.  

Last week: 2016 to be a Year of Power Shifts and Workforce Facelifts.  

Head Impacts in Lacrosse Subject of Closely Watched Study at Sacred Heart University

With heightened focus in recent years on the ramifications of concussions on the careers and lives of athletes – especially professional football players – research is gaining interest and attention in a range of contact sports. The recent release of the popular movie Concussion has pushed awareness and interest even further – along with the appetite for scientific research. In Connecticut, Sacred Heart University (SHU) is underway with poised to start the third year of a four-year study of the school’s men’s lacrosse team, which will be among the first comprehensive studies looking at head impact and concussions in the sport at the college level. U.S. Lacrosse, the sport’s governing body, provided the SHU athletic-training education program a $15,000 grant to study the effects of on-the-field head impacts. The 2016 season began on February 13 and runs through April 30.

The SHU study got underway in January 2014 and was initially focused on freshmen players.  It has continued to monitor the same athletes as they progress through their four-year lacrosse career.  The goal is to gain a better understanding of concussions in the sport and ultimately generate insights for safer play.

Theresa Miyashita, director and assistant professor for the athletic training education program, launched the accelerometer concussion study at the University. The research involves the use of accelerometers in the team’s helmets. These sensors detect the amount of impact (in Gs or standard gravity acceleration) a player receives when he gets hit by a ball, a stick, another player or hits the ground.

“We are one of the first in the country to embark on an accelerometer concussion study of this size in men’s lacrosse,” said Miyashita. “We are collaborating with Professor Michael Higgins at Towson University, who is conducting a similar study to compare impacts on different helmets (Cascade vs. Warrior). This research targets the fastest-growing team sport in America.”

The players have been wearing these sensors in their helmets for the entire season – both in practices and games. The information received from the sensors is then uploaded to see the number of impacts sustained, where the impacts were sustained and the amount of Gs each impact had. This data is then compared to a number of different variables such as neurocognitive function, modified IQ scores, depression/anxiety, alcohol/drug dependency screens and concussion injuries. The players were baseline tested and are given a post-test when each season is complete.

The study is being done in partnership with a Canadian company, GForceTracker, which has developed “an advanced athlete monitoring system used to collect, measure, and analyze head impacts & biometric performance data, all in real time.” The company produces a “Hit Count® Certified, advanced linear g-force and rotational impact sensor monitoring system that accumulates a lifetime of head impacts.”

The detection device monitors, measures and provides vital statistics such as number of impacts, severity of impacts, local alarming when the impact exceeds an acceptable threshold and accumulates this data to provide key metrics that determine whether its user has suffered a possible head injury.  The GFT is currently the only Hit Count® Certified head impact sensor on the market, the company’s website indicates, “and can be used by individual players or entire teams in both helmeted and non-helmeted sports.”

“The men’s lacrosse team and their coach, John Basti, have been huge supporters and have been instrumental in getting this project running,” Miyashita said. “This project would not be possible without them and the rest of my research team.”

Miyashita’s team consists of Professor Eleni Diakogeorgiou; Kaitlyn Marrie, staff member for the athletic training program; Mary Jo Mason from the Health and Wellness Center, Professor Kelly Copperthite and a number of her athletic training students.  The Fairfield County Business Journal recently reported that Miyashita’s husband is a former professional player who is now assistant coach of the SHU men’s team.

Sacred Heart University, with a student population of 6,400, is the second-largest independent Catholic university in New England, offering more than 50 undergraduate, graduate and doctoral programs on its main campus in Fairfield.  The SHU Pioneers' men's lacrosse team competes in the Northeast Conference of the NCAA Division 1.

https://youtu.be/TewBxtexNjE

Motor Vehicle Deaths Up 14 Percent in CT in 2015, Exceeding National Average

The death toll in Connecticut from motor vehicle accidents increased 14 percent in 2015 from the previous year, consistent with a nationwide increase but higher than the national average.  The increase in Connecticut ranked the state tied for 14^th in the percentage increase in motor vehicle deaths from 2014 to 2015. Nationally, 2015 saw the largest single-year percent increase in motor vehicle deaths since 1966. Estimates from the National Safety Council (NSC) show an 8 percent increase in 2015 compared with 2014 – with substantial changes in some states, including Connecticut.  There were 283 motor-vehicle related deaths in Connecticut last year, compared with 249 in 2014 and 276 in 2013.

While many factors likely contributed to the fatality increase, a stronger economy and lower unemployment rates are likely at the core of the trend.  The National Safety Council estimates 38,300 people were killed on U.S. roads, and 4.4 million were seriously injured, meaning 2015 likely was the deadliest driving year since 2008. The annual total of motor vehicle fatalities for 2014 was 35,398.

Over the last year at the state level, the National Safety Council estimates Vermont (30 percent), Oregon (27 percent), New Hampshire (24 percent), Georgia (22 percent), Washington (21 percent) and Florida (18 percent) experienced the largest percentage increase in fatalities, while only 13 states showed improvement. Among them were New Mexico (-20 percent), Kansas (-7 percent) and New Jersey (-2 percent).

Increases were also in Arizona (15%), Colorado (17%), Idaho (17%), Montana (17%), Maine (16%), Maryland (16%), and South Carolina (16%).  Also seeing 14 percent increases along with Connecticut were Arkansas, Minnesota, Missouri, and Nevada.  

“These numbers are serving notice: Americans take their safety on the roadways for granted,” said Deborah A.P. Hersman, president and CEO of the National Safety Council. “Driving a car is one of the riskiest activities any of us undertake in spite of decades of vehicle design improvements and traffic safety advancements. Engage your defensive driving skills and stay alert so we can reverse this trend in 2016.”

From 2013 and 2015, Connecticut had a 3 percent increase in traffic fatalities, according to the data.

The estimated cost of motor-vehicle deaths, injuries, and property damage in 2015 was $412.1 billion, according to NSC.  The costs include wage and productivity losses, medical expenses, administrative expenses, employer costs, and property damage.

The estimate is subject to slight increases or decreases as data mature, according to the National Safety Council. NSC has issued annual traffic fatality estimates since 1921. Over the last three years, preliminary estimates have fallen within 1 percent of final counts.

Average gas prices were 28 percent lower in 2015 than in 2014 and are projected to continue dropping this year, making driving more affordable for many Americans, NSC pointed out, noting that the U.S. Department of Transportation estimates a 3.5 percent increase in the number of miles driven in 2015 compared to 2014.

To help ensure safety, the National Safety Council recommends drivers:

• Make sure every passenger buckles up on every trip
• Designate an alcohol and drug-free driver or arrange alternate transportation
• Get plenty of sleep and take regular breaks to avoid fatigue
• Never use a cell phone behind the wheel, even hands-free
• Stay engaged in teens’ driving habits, as teens are three times as likely to crash as more experienced drivers
• Learn about vehicle safety systems and how to use them, including features such as adaptive cruise control, blind spot warning systems and backup cameras.

Founded in 1913 and chartered by Congress, the National Safety Council, nsc.org, is a nonprofit organization whose mission is to save lives by preventing injuries and deaths at work, in homes and communities, and on the road through leadership, research, education and advocacy.

Connecticut is Most Religious State in New England

Connecticut is the most religious state New England, ranked number 38 in the nation, according to a new Gallup poll.  The other New England states are all in the bottom ten, according to the survey, which covered the year 2015. New Hampshire is the least religious state in the nation, with 20 percent of residents considering themselves to be “very religious,” 24 percent “moderately religious” and 55 percent “non-religious.”  Just ahead of New Hampshire at the bottom of the list, are Vermont (22 percent very religious), Maine (26 percent very religious) and Massachusetts (27 percent very religious).  Rhode Island is ranked 43, with 32 percent of residents considering themselves to be very religious.

Connecticut, the only New England state ranked higher than the bottom ten, broke down this way:  33 percent very religious, 28 percent moderately religious, and 39 percent non-religious.

In the annual survey, Mississippi (63 percent) has extended its eight-year streak as the most religious state, followed closely by neighboring Alabama (57 percent), according to Gallup.  Rounding out the top ten “very religious” states were Utah, Louisiana, Tennessee, Arkansas, Georgia, South Carolina, North Carolina, Kentucky and Texas.

The state-by-state results are based on over 174,000 interviews conducted as part of Gallup Daily tracking in 2015, including more than 480 interviews in every state and more than 1,000 interviews in most states.  In Connecticut 1,919 interviews were conducted, according to Gallup.

Gallup classifies Americans into three religious groups based on their responses to a question measuring religious service attendance and how important religion is in their daily life. Very religious Americans are those who say religion is important to them and who attend services every week or almost every week. Nonreligious Americans are those for whom religion is not important and who seldom or never attend religious services. Moderately religious Americans meet just one of the criteria, either saying religion is important or that they attend services almost every week or more.

Nationwide, the percentage classified as very religious on the basis of their attendance and view on the importance of religion has stayed remarkably stable since the survey began seven years ago. In 2008, 41% of Americans were very religious, 29% moderately religious and 30% nonreligious. In 2015, those same percentages are almost identical: 40%, 29% and 31%, respectively.

Federal Transportation Funds to Increase As Connecticut Considers Long-Term Plan

As Connecticut policy makers consider a long-term infrastructure investment in Connecticut’s transportation system, they do so just months after the federal government, after years of inaction, adopted the FAST (Fixing America’s Surface Transportation) Act at year’s end.  It is the first comprehensive transportation law since 2005, according to Connecticut’s Office of Legislative Research (OLR). The act includes $225.2 billion for highway investment, $61 billion for federal transit programs, and $10 billion for the Federal Railroad Administration and Amtrak.  States will get about a 5.1 percent increase in funding in FFY 16 and annual increases ranging from 2.1 percent to 2.4 percent in subsequent years, according to OLR.

State lawmakers are considering Governor Malloy’s proposed $100 billion, 30-year Let's Go CT! program, unveiled earlier this month, which included a call to enact a constitutional amendment creating a financial lockbox to protect transportation funds. Officials have said that 47 percent of state-maintained roadways are in “less-than-good condition”, and 35 percent of Connecticut's bridges are functionally obsolete or structurally deficient.  The Connecticut Business and Industry Association has said that 42 percent of businesses think the state's road congestion hinders their opportunities and growth.

As a result of the FAST Act, Connecticut will receive about $3.5 billion over five years, or about $700 million annually, for highway and transit programs, which is about $62 million more per year than Connecticut received in 2015.  The state Department of Transportation says the act’s importance isn’t in the amount of money it provides, which does not change dramatically from previous levels, but in the predictability and assurance of funding it provides, OLR Principal Analyst Paul Frisman points out in a report to state legislators. 

The FAST Act’s transfer of the $70 billion into the federal Highway Trust Fund (HTF) was essential to keep the fund solvent. The federal government has not increased the federal 18.4 cent gas tax in more than 20 years, and this has reduced the HTF’s purchasing power and reduced its ability to keep pace with rising infrastructure costs and inflation. Decreased revenues because of more fuel efficient vehicles and the popularity of alternative fuel vehicles also cloud the HTF’s future, the report indicates.  There continue to be concerns that if revenues going into the fund are not increased, insolvency may await, as soon as 2020.

The FAST Act also includes two new freight initiatives, including a National Freight Program which authorizes $6.2 billion over five years for national and state projects to improve highway freight transportation. The OLR report indicates that to participate, a state must complete a State Freight Plan, which it must update every five years. The American Road and Transportation Builders Association (ARTBA) has said that participating states will be able to obligate up to 10 percent of this funding to improve freight rail services or ports, which may be of particular interest to Connecticut.  The other new program is aimed at highway, bridge, rail-grade crossing, intermodal, and freight rail projects that cost at least $100 million, improve movement of both freight and people, reduce bottlenecks, and improve connectivity.

The FAST Act also makes changes to several highway funding programs, with a focus on surface transportation, local roads and bridges, transportation alternatives such as bicycling.  To increase efficiency and speed up the project review process, ARTBA reports that the FAST Act encourages the use of a single environmental review document throughout the entire review process, instead of the current practice of having each agency involved in a project conduct a separate review.

The OLR report also indicates that a Federal Highway Administration pilot program permits up to three states to toll existing Interstate highways that they could not otherwise adequately maintain or improve, and increase funding available for public transportation initiatives.  In addition, $2.6 billion is provided to Amtrak’s Northeast Corridor (and $5.4 billion to other Amtrak lines) over five years. It separates the Northeast Corridor, from Boston to Washington, D.C, from other Amtrak accounts to ensure that the amounts assigned to that Corridor are used there, OLR reports.

Even with the additional funding nationwide, transportation officials in Connecticut and around the country continue to warn that “long-term, sustainable funding for transportation is yet to be achieved,” as described by the American Association of State Highway and Transportation Officials.

Connecticut’s Presidential Primary Ballot to Take Shape for April 26

In the roller-coaster that is the presidential nomination process, with its progress of caucuses and primaries in states across the country, Connecticut’s card does not come up until late-April.  Who will reach the Connecticut ballot, and the order in which they will be listed, will be determined in the coming weeks by Secretary of the State Denise Merrill, in accordance with criteria outlined in state law. That process begins this Tuesday, February 16,  with the announcement of presidential candidates who have qualified for the Connecticut primary ballot.  The order in which candidates will appear on the ballot for the Republican and Democratic parties will not be known until March 22, when Secretary Merrill will “determine the order of all candidates by lot in a public ceremony.”  Connecticut law also requires that “Uncommitted” appear last on each party’s ballot.

When Connecticut voters go to the polling places on Tuesday, April 26, voters in nearly two-thirds of the states will already have made their preferences known.  The same day as Connecticut, presidential primaries will also be held in Delaware, Maryland, Pennsylvania and Rhode Island.  The previous week, primaries will be held in New York, a state called home, at various times, by three of this year’s leading contenders – Hillary Clinton, Bernie Sanders and Donald Trump.

March 1 and March 15 are major dates on the presidential primary calendar this year.  Dubbed Super Tuesday, March 1 will see votes cast in Alabama, Alaska, Arkansas, Colorado, Georgia, Massachusetts, Minnesota, Oklahoma, Tennessee, Texas, Vermont, Virginia and Wyoming.  Two weeks later, the spotlight will fall on Florida, Illinois, Missouri, North Carolina, and Ohio.

Also prior to Connecticut, the states of Wisconsin, Wyoming, Washington, Hawaii, Arizona, Utah Idaho, Michigan and Mississippi will conduct their presidential primaries, according to the Council on State Governments.

According to Connecticut’s Office of Legislative Research, in August 2010, the Democratic National Committee and the Republican National Committee adopted rules prohibiting states, other than Iowa, New Hampshire, South Carolina, or Nevada from holding a presidential primary before the first Tuesday in March in the year in which a national convention is held (Democratic National Committee, Delegate Selection Rules, Rule 11(A) and Republican National Committee Rules, Rule No. 16(c)(1)).  In response, Connecticut delayed the date of its presidential primary from the first Tuesday in February to the last Tuesday in April (CGS § 9-464).

Reaching the Primary Ballot

In Connecticut, the political parties with the largest and second largest number of enrolled members conduct presidential preference primaries, according to the website Ballotpedia. There are two methods by which candidates can access the primary ballot:

• The Connecticut Secretary of the State can order that a candidate's name be printed on the primary ballot if he or she "determines ... that the candidacy of such person for such party's nomination for president is generally and seriously advocated or recognized according to reports in the national or state news media." The secretary of state must publish a listing of such candidates at 10:00 a.m. on the 74th day preceding the primary.  (This year, that is Tuesday, February 16.)
• A candidate who is not included on the Secretary of the State’s list can petition for placement on a party's primary ballot. A candidate may request the requisite forms from the secretary of the state’s office beginning at 12:00 p.m. on Tuesday. The petition must contain signatures equaling at least 1 percent of the total number of enrolled members in the candidate's party in the state, and must be submitted to "the registrar of voters of the party holding the primary in the town of voting residence of the signers thereof" by 4:00 p.m. on the 53rd day preceding the primary (March 4). The registrar of voters must verify the signatures and forward the petition to the secretary of state by 4:00 p.m. on the 49th day preceding the primary (March 11).

Among the states holding presidential primaries after Connecticut in May and June are Indiana, New Mexico, California, New Jersey, Nebraska, West Virginia, Oregon and Montana.  Most states have their Democratic and Republic primaries on the same day, although a handful hold party primaries on different days. South Carolina’s Republican primary will be on February 20, for example, and its Democratic primary on February 27.

Should any candidate whose name is set to appear on the Connecticut April 26 primary ballot decide to withdraw from the race, the deadline is March 21.  A letter indicating withdrawal must be received by the Secretary of the State by 12 Noon.  Petitioning candidates may not withdraw, according to state officials.

Absentee ballots for military and overseas voters become available on March 12.  Absentee ballots will be available as of April 5.  Only registered voters in a particular political party can vote in the presidential primary of that party.  The deadline for new voters, and for unaffiliated voters to mail in party affiliations is April 21.  The in-person deadline is April 25, the day before the primary, at 12 Noon.  On primary day April 26, the polls are open from 6 AM to 8 PM.

Editorial Cartoon by Bob Englehart

PERSPECTIVE: 2016 to be a Year of Power Shifts and Workforce Facelifts

by Thomas Phillips and Sandra Rodriguez With New England as clearly the oldest region in the country with an average age of 40.3 years,[1] there significant retirements are expected for the next 15 years that will have a profound impact on the size and quality of our labor force.

Yet, with workforce demand at high levels, the supply side isn’t sufficient to meet employer needs.  There are many reasons for this supply/demand mismatch.

NOT ENOUGH PEOPLE.  The growth rate of the US population aged 18 to 64 is rapidly decelerating and will remain very low through 2030.[2]  That should translate into a continued difficult time in finding qualified workers, while the knowledge base within businesses and organizations is eroding.

NOT ENOUGH HARD and SOFT SKILLS. There is a perceived shortage of people with the hard and soft “essential” skills both required and desired by hiring professionals.  This may be why nearly half of those jobless in Connecticut and neighboring states are considered long-term unemployed.[3]  The technical skills these individuals possess are no longer applicable and essential skills get “rusty” when not used over a period of time.  For the younger population, these skills are often untested.

NOT ENOUGH INTEREST FOR THE JOBS IN DEMAND.  Demand is high for healthcare and manufacturing workers.  Construction employment has also been increasing in Connecticut[4] and is expected to continue to rebound over the next few years.[5]  However, according to The Hartford’s 2015 Millennial Leadership Survey (published by The Hartford), less than 7% of the younger generation interviewed responded favorably to wanting careers in Manufacturing or Construction.  Fortunately, 31% of the 18-34 year olds interviewed said their interests lie in healthcare, but percentage-wise, they are more interested Arts and Entertainment, Education and Technology.

NOT ENOUGH COLLABORATION. As Connecticut and the New England region is facing economic challenges, an aging workforce, and lack of coordination and overlap in services, now is the time to create more public / private partnerships to drive success.

PROMISING APPROACHES.  The Supply/Demand Workforce mismatch can’t be solved by any one organization, with any one grant or source of funding, or with any one strategy.  In North Central Connecticut, Capital Workforce Partners and other collaborative organizations are stoking the pipeline with skilled talent, in areas of current or expected business demand through a web of integrated partnerships.  Here are just two examples:

MOVEUP! COLLABORATIVE. This is a collaborative effort among 26 adult education providers, workforce training programs and community colleges to improve adult literacy services in the Capital Region of Connecticut.  Move UP!’s partners envision a regional adult literacy system that offers a coordinated continuum of literacy services, childcare, counseling and other social service support, career pathways that lead to well-paying jobs and coordination within the community to get the work done.

HARTFORD OPPORTUNITY YOUTH COLLABORATIVE.  This Collaborative includes leaders in education, youth development, and workforce development committed to addressing the education and employment needs of 16 to 24 year old disconnected youth (not in school and not working or no high school diploma) otherwise known as ‘Opportunity Youth.’  With financial support from the Aspen Forum for Community Solutions, Hartford Foundation for Public Giving, and the Social Innovation Fund (as a subgrantee of Jobs for the Future), a full scale, multi-year comprehensive plan has been developed and several youth-centered programs are underway.

These initiatives share one common thread – partnership between business, workforce development, education, economic development and government.  In this new year of power shifts and workforce facelifts, it will take all community stakeholders together to ensure there are enough people, trained and ready to work in the jobs that are in demand today and will be in demand tomorrow.  It will take public/private partnerships to guarantee that the education system is preparing youngsters with the mastery they will need to be successful in their career pathways.  And it will take groups with differing ideologies and competing missions to continue to convene and collaborate until as much common ground can be identified as possible for progress.

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Thomas Phillips is President and CEO, and Sandra Rodriguez is Communications Director, at Capital Workforce Partners, which provides a range of services and training to job seekers and businesses.  Learn more at www.capitalworkforce.org

PERSPECTIVE commentaries by contributing writers appear each Sunday on Connecticut by the Numbers.

[1] 2010-14 American Community Survey 5-Year Estimates

[2] Conference Board: “From Not Enough Jobs to Not Enough Workers What Retiring Baby Boomers and the Coming Labor Shortage Mean for Your Company” Publication Date: September 2014 Report Number: TCB-R-1558-14-RR. Data Source:  The Census Bureau

[3] Nick Difiesta and Derek Thomas, MPA, Connecticut Voices for Children, “The State of Working Connecticut 2015,” November 2015

[4] Connecticut Department of Labor

[5] Economic Modeling Specialists International (EMSI)

Corporate Headquarters Headed Back to Cities, But Shrinking, Report Says

The departure of GE’s corporate headquarters for Boston reflects a growing trend for headquarters of major corporations to relocate back to cities, but a recent study indicates they not only move, but shrink, becoming a “reconstituted, smaller version”of their former corporate selves. Analyst Saskia Sassen, author of The Global City, describes such moves, which often consist of “only the most senior people” in the firm as “executive headquarters.”  A feature this month by Crain’s Business Chicago investigates the trend, as it has been evolving in Chicago.  Their report points out that “these headquarters make for great headlines, but they don’t necessarily result in that many jobs,” according to the website newgeography.

“The notion of the corporate headquarters in the ‘Mad Men’ world when there were hundreds or thousands of people in a building with the company logo . . . those days are gone,” says David Collis, a professor at Harvard Business School who studies corporate headquarters.

The Crain’s article points out that “when Chicago landed ADM in 2013, it got 70 executives and white-collar employees, plus a promise of 100 technology jobs that never arrived. Two years later, Decatur still has 4,200 ADM workers.”

The story points to good news and bad news for Chicago.  The bad news, is that a “headquarters ain’t what it used to be. On the other hand, Chicago is winning the battle for them,” and the ripple effect they provide.  These smaller executive headquarters, particularly for major global businesses, benefit from being in a global city, the article explains. Chicago has lured a number of these from out of town, noting that agro-industrial firms are increasingly choosing Chicago: ADM, Con Agra, Mead Johnson Nutrionals, and Oscar Mayer in recent years.

The same may be said for GE and Boston, and the city’s technology-intensive environment. Some fear that Chicago's technology startups, the article reports, are particularly vulnerable to leaving for Silicon Valley, attracted by venture capital and a deep talent pool.  Boston may be in the running for similar relocations.

A similar phenomenon is occurring in Pittsburgh.  After 70 years in a suburban location, Kennametal announced plans last fall to relocate its world headquarters to an urban location. “We’re a global business that’s making changes to stay competitive in a new industrial era,” said the company.  “We have more than 13,000 employees in 40 countries serving customers in more than 60 countries every day. An urban location puts us in closer proximity to major universities and the airport and will enable us to recruit more talent.”

The Wall Street Journal reported last year that online travel agency Expedia Inc. announced plans to relocate its headquarters from a Seattle suburb that it called home for nearly 20 years to the city’s downtown.

“In the late 60s and early 70s, CEOs in places like New York City fled the city and moved to the suburbs, leading to the growth of Westchester County, Stamford and Greenwich, Connecticut,” Ed McMahon, a senior resident fellow for the Urban Land Institute, told the newspaper. “In those days, the determining factor was where the CEO of the company wanted to live.”

Now, the Journal reported, “large companies are moving back into the city in an attempt to attract and retain workers—particularly younger workers who are postponing homeownership and favor renting in walkable neighborhoods with easy access to restaurants, shopping and cultural opportunities.”

“Connecticut has really been hammered by the trend away from suburban campuses,” writes Michael Brendan Dougherty in The Week. “Aetna demolished a 1.3 million-square-foot campus in Middletown in 2011. That site is vacant. Pfizer dumped a research campus in Groton after that. The suburbs around Chicago, which once gladly received Sears' corporate headquarters, may be hit next.”  It seems that they are.

The Crain’s article reports that headquarters began shrinking a decade ago, but the trend has accelerated in the past three years, according to Vinay Couto, a consultant in the Chicago office of Strategy&. In recent years, 16 companies have relocated their main headquarters to the city from the suburbs. Seventeen came from outside the metro area. The phenomenon, he points out, is driven by the outsourcing of shared services such as IT, accounting and human resources, as well as by a mindset borrowed from private equity to cut overhead and make every part of a business count toward profitability.

The website Investopedia defines “corporate headquarters” as “a business' most prestigious location,” adding that it may “bring prestige to the city it is located in and help attract other businesses to the area.”

Moving headquarters can also be a way for companies to break from the past and shed employees and positions, Couto says.  And the loss of a major headquarters doesn't necessarily stifle job gains. When Boeing moved to Chicago, Seattle's economy kept growing, Kevin Hively, founder of Ninigret Partners, a business and economic development strategy consulting firm in Providence, R.I., told Crain’s. In that case, however, the presence of Microsoft and Amazon helped.

Firsthand Accounts of Effects of Hunger in Connecticut On Display at State Capitol

Hunger in Connecticut is described as a pervasive problem: one in seven Connecticut residents struggle with hunger; 14.3 percent of Connecticut families do not have adequate resources to purchase enough food; 68 percent of Connecticut food pantry and soup kitchen clients at one point had to choose between food and medical care. Those stark statistics come alive through the firsthand accounts of individuals in Witnesses to Hunger CT, a photovoice exhibit showcasing firsthand accounts of hunger in Connecticut, which has opened in the lower level concourse of the Legislative Office Building in Hartford and will run through Thursday, February 11.

“Connecticut is one of the wealthiest states in the nation but there are many who struggle every day to put food on the table,” Lucy Nolan, Executive Director, End Hunger Connecticut!, said. “The Witnesses recruited to participate in this project have been faced with choices that are hard to fathom – whether to eat low cost foods that could be harmful to their medical conditions or not eat at all, whether to pay for prescriptions or put food on the table, and whether to feed themselves or give extra food to their children. We hope this exhibit can serve as a reminder that many among us, often hidden, need the state’s support.”

The 15 Witnesses to Hunger CT come from Connecticut’s cities, suburbs and rural communities. Kimberly’s picture told the story of her teenage son who while grateful to have something to eat wished there was meat on the plate. Randy from Westport had a good job until struck by cancer and now gets many meals from the soup kitchen and pantry. In his photo he holds a grocery bag in his hands and says while he is grateful for that safety net he wishes there were more fresh foods available. The photos tell a story of everyday choices that must be made to survive.

The project is a collaboration of Connecticut nonprofit organizations, anti-hunger and anti-poverty advocates, and state agencies inspired by Witnesses to Hunger, a project of the Center for Hunger Free Communities at the Drexel University Dornsife School of Public Health.  Advocates point out that limited access to food leads to poor health outcomes, including stress, obesity, and inability to succeed in work or school.

“There are four main themes that emerged from this project and tell me a compelling story,” said State Senator Marilyn Moore, Bridgeport. “The Witnesses to Hunger CT show everyday struggles with health and wellness, food and nutrition, transportation and adequate shelter. If we want people to succeed we need to make sure we support them. I appreciate their bravery in shining a light on these themes.”

Connecticut is the last in the nation for the number of schools with a school breakfast program, according to End Hunger Connecticut! officials. They point out that 64.6 percent of schools participate, and 45 percent students participate in free and reduced price breakfast for every 100 in lunch.  Connecticut would receive an additional $9.6 million federal dollars if the participation rate of school breakfast reached 70 percent.

Connecticut’s SNAP (formerly Food Stamps) participation rate is 72 percent and 53 percent of the eligible working poor participate in the SNAP program. Many go to food pantries instead for food, organization officials said. They indicated that for every $1 spent on WIC funding, Connecticut saves $1.77-$3.13 on future medical costs.

“The members of Witnesses to Hunger are the real experts on hunger and poverty,” said Dr. Mariana Chilton, an associate professor at Drexel University’s Dornsife School of Public Health and founder of Witnesses to Hunger. “Too many decisions today are made without consulting with the people that are affected most by policies made in Washington. We are thrilled to have families from Connecticut join in the national movement of families speaking from first hand experiences to inform policy makers and the public about the true realities of America’s struggles and how to solve them.”

They noted that 11.9 percent of Connecticut residents are food insecure and 4.7 percent are very food insecure — a slight increase from 2008.

“Data shows the food insecurity rate among those living with a severe mental illness is 475 percent higher than those who are not battling mental illness,” said Billy Bromage, MSW, Director of Community Organizing, Yale Program for Recovery and Community Health. “We know that good nutrition plays a key role in mental health and that’s why the mental health community is here today to support the Witnesses.”

Witnesses to Hunger CT is the second exhibit of its kind in the state. The first took place in New Haven in 2014 and was championed by Congresswoman Rosa DeLauro.  Witnesses to Hunger CT is a collaboration of:  Advocacy Unlimited, Connecticut Association for Basic Human Needs (CABHN), Center for Hunger Free Communities at the Drexel University Dornsife School of Public Health, Connecticut State Department of Mental Health and Addiction Services (DMHAS), Connecticut Food Bank, End Hunger Connecticut!, Foodshare, Immanuel Congregational Church/UCC, Hispanic Health Council, New Haven Food Policy Council, and the Yale Program for Recovery and Community Health.

The exhibit will be in the lower concourse of the Legislative Office Building (LOB) through February 11th. A booklet prepared for the exhibit can be found at http://www.endhungerct.org. The LOB is located at 300 Capitol Avenue, Hartford and is open weekdays 8:00 am to 5:00 pm.  Free parking is available (first come first served) at the LOB Garage, which is located directly behind the LOB.

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