Archive for January, 2012

They Get You by the Teeth

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January 22nd, 2012

Lack of dental coverage sends patients running to ER for pain relief

While government-managed health care programs such as Medicaid pay for emergency room visits for adults seeking temporary relief from toothaches and other dental emergencies, coverage of outpatient dentist office treatment for those problems varies from state to state, according to a 2011 federal Medicaid report. Federally mandated preventive and other dental care usually ends when Medicaid recipients enter early adulthood. That leaves states to determine whether they will provide dental benefits to adult Medicaid patients and if so, what type and how much.

No Medicaid

The report shows that 10 states offer no Medicaid dental benefits to adults. The remaining states offer a jumble of services that leave many adults with inadequate and limited access to dental care. In addition, Medicare doesn’t cover routine dental care or most dental procedures such as cleanings, fillings, tooth extractions or dentures, Medicare spokeswoman Ellen Griffith said. As a result, many adult government health care program enrollees and uninsured Americans are turning to emergency care providers nationwide to manage the pain from dental problems. Unlike dentists or oral surgeons, ER doctors and other health care providers can’t pull a tooth or treat other dental problems.

The ER

One dentist estimates as many as 40% of the patients she sees needing an extraction had previously sought care in an ER. Those ER visits translate into higher costs for taxpayers as many patients return to the ER two or more times per dental problem to manage symptoms, according to the ADA. And, while the Affordable Care Act addresses dental care for children on Medicaid, the requirement doesn’t exist for adults, ADA spokesman Robert Raible said. "This funnels everyone to the ER, which is the most expensive place to get health care," said Sorkey.

Dental emergencies

Between 1.3% and 2.7% of all ER visits nationwide that don’t result in a hospital admission are dental emergencies, the HRSA report says. A 2011 South Carolina Dental Association study estimated a single ER visit for toothache pain resulted in a Medicaid reimbursement of $236. The report found a dentist’s office visit, which would include extraction of an infected tooth, would be about $107. "The key thing is the problem is not solved when they go to the emergency room," said Phil Latham, the Association’s executive director. "If they can go to a dental office, the problem is solved for half of the reimbursement."

The ADA

To better evaluate the impact of using the ER for relief of dental emergencies nationwide, the ADA is working with the Centers for Disease Control and Prevention to devise a methodology to get "broader and deeper numbers and look at key indicators for solutions," ADA President William Calnon said. Louisiana Medicaid Medical Director Rodney Wise said the state’s decision not to cover dental expenses for most Medicaid patients 21 and older is about money. South Carolina and Washington State cut adult Medicaid dental benefits last year, and other states, such as California, have reduced benefits in recent years in an effort meet budget cuts, according to state and federal reports.

Tags: Dental treatment, Medicaid, Tooth extractions
Posted in Business, Economy, Employment, Finance, Health Insurance, Personal / Internet | No Comments »

New Watchdog Agency Reviewing Payday Lending

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January 20th, 2012

Payday lending, an industry that brings in some $7 billion a year in fees nationwide

The Consumer Financial Protection Bureau said testimony from the session in Birmingham would help guide the development of future regulations. Recently appointed Director Richard Cordray said the bureau recognizes the need for short-term loans, but the lending needs to help consumers, not harm them. "Before this month, the federal government did not examine payday lenders," Cordray said. "Some state regulators have been examining payday lenders for compliance with their state laws. We hope to use our combined resources as effectively as possible."

Huge number of lenders

Officials said that about 19 million American households now have payday loans. With interest rates often in the teens and easy application procedures, lenders said they generate business through radio and television advertising, plus word-of-mouth and by locating offices in areas where other small-loan lenders are located. Many in the standing-room crowd of more than 400 were lending company customers or employees who wore "I Choose Payday Advance" stickers provided by the industry. Tanzy Bonner told a panel she got a payday loan to cover the cost of her 6-year-old’s birthday party; LaDonna Banks said she got one because she couldn’t work after donating a kidney to her brother.

The Consumer Financial Protection Bureau

The Bureau has been in the spotlight because of Republican opposition to its formation and President Barack Obama’s use of a recess appointment earlier this month to tap Cordray, a former Ohio attorney general, as its director. With GOP legislators blocking the nomination because they said the agency lacks sufficient congressional oversight, Obama installed Cordray.

Payday loans

Often criticized by advocates for the poor, payday loans are short-term, high-interest loans that work like cash advances. Storefront payday loan operations are prevalent in middle- to lower-income areas around Alabama, sometimes taking over closed convenience stores or fast-food restaurants. Loan amounts in Alabama are capped at $500 by state law, which limits the maximum interest rate to 17.5 percent. An industry website said the annualized interest rate for a 14-day loan of $100 tops 456 percent.

Typical loan

In a typical transaction, a borrower writes a check for $117.50 and gets $100 from the payday lender, who holds the check for a short period before depositing it. If the customer needs the check held another two weeks, he pays another $17.50 fee.

Officials said more than 20 percent of Alabama households have taken out loans from payday storefronts or similar businesses at more than 1,000 locations statewide. Opponents said the businesses prey on people who lack access to traditional loans when they get in a pinch for cash.

Gouging for loans

"People get churned through the system six, eight, 10 times a year," said Stephen Stetson, a policy analyst at Alabama Arise, a Montgomery-based anti-poverty organization. "If we have laws against gouging for gas and water, we ought to have laws against gouging for loans. Listening to what you heard here today, you’d think my thousands of employees go to work every day to hurt their neighbors," he said. Rather than enacting sweeping federal rules, he said, states should concentrate on getting rid of "bad actors" in the business.

Tags: Payday Loans, The Consumer Financial Protection Bureau, Watchdog agency
Posted in Advance Cash Loan, Business, Cash Advance Loans, Economy, Employment, Finance, Loans, Money, Payday Loans, Personal / Internet | No Comments »

National Anti-Payday Lending Campaign on the Way

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January 18th, 2012

Campaign hopes to free one million Blacks from debt

Rev. Dr. DeForest Soaries, senior pastor of the 7,000 member First Baptist Church of Lincoln Garden in Somerset, NJ is launching a national effort against one of the most predatory lending products: payday loans. This church-based movement was inspired by hundreds of contacts and phone calls Soaries received following his appearance in a 2010 CNN documentary, Almighty Debt. Hosted by Soledad O’Brien, the documentary shared the financial struggles of Lincoln Garden members facing foreclosure, finding student financial aid and adjusting to long-term unemployment.

CNN

According to CNN, the documentary also became the network’s second-highest rated program that year with 13.8 million viewers. What began as a 90-minute television program turned into a year-long advocacy effort with four specific objectives:

Education: distribution of information through churches, barbershops, community centers;
Direct Action: coordinating protests in front of payday stores;
Alternatives to payday loans: identifying alternatives available through credit unions, minority banks and other lenders;
Public policy: working with local leaders to initiate actions to restrict payday and other predatory practices.

Payday lending ills

Over the past decade, the ills of payday lending have been a focus of the Center for Responsible Lending. Through a series of state-based efforts partnering with local advocates, 17 states and the District of Columbia have enacted payday reforms, saying ‘no’ to triple digit interest rates and downward spiraling debt. Additionally, federal law protects military members and their families from the typical 400 percent interest rates of payday loans.

Short term loans

In recent years, however, the growth of new versions of small-dollar, short term loans such as Internet and bank payday loans threaten to circumvent all of these hard-fought consumer victories. In particular, bank payday loans lead to 175 days of indebtedness for the average borrower, twice as long as the maximum length of time the Federal Deposit Insurance Corporation has advised. With many banks allowing up to half of a customer’s monthly direct deposit income, or up to $750, an average 44 percent of a bank payday customer’s next deposit is used to repay bank payday loans. For older borrowers already living on fixed incomes, the average bank payday loan repayment from a Social Security check was 43 percent. Senior customers are also 2.6 times more likely to have used a bank payday loan than bank customers as a whole.

Older adults

Even without bank payday loans, more than 13 million older adults are considered economically insecure, living on $21,800 per year or less. One-fifth of older households have annual incomes below $50,000 but report spending more than 40 percent of their income on debt payments.

CRL research

CRL research has shown that communities of color are particularly vulnerable to payday loans. Across the country, the concentration of storefront lenders is typically greater in black and brown communities. Additionally, Missouri is the only state outside the Deep South with the greatest number of payday stores per capita. Persons and organizations desiring to join the advocacy effort are advised to contact Pastor Soaries at: fbc@fbcsomerset.com .

Tags: CRL Research, Payday Loans, Short term loans
Posted in Advance Cash Loan, Business, Economy, Employment, Finance, Loans, Money | No Comments »

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