• WisBusiness

Thursday, April 29, 2010

Innovation around energy and conservation will continue, even without new law

By Tom Still
If you listen to some of the bill’s supporters, the Legislature’s failure to pass the Clean Energy Jobs Act means the polar ice cap will melt away within a year and we’ll all be indebted forever to OPEC.

Conversely, some of the bill’s opponents predicted Wisconsin’s economy would run out of gas overnight if the state tried to better position itself as a player in the “green economy.”

Fortunately, neither doomsday scenario is true. That’s because the immense market forces at work will continue to transform Wisconsin’s energy economy, even without more legislation right now to prod things along.

A recent survey of 1,400 company executives by Milwaukee-based Johnson Controls Inc. found that most businesses are investing heavily in energy efficiency, either to save money over time, to reduce their carbon footprint or both. Nearly one-third of the execs who responded to the survey said they increased energy efficiency spending in 2009, despite the recession.

Many of those companies are already reporting double-digit returns on their investment – and they’re expecting even greater returns as tougher greenhouse gas requirements become a reality.

Alternative energy research and investment isn’t powering down, either. At an April 27 meeting of the Wisconsin Innovation Network in Madison, leaders of the Wisconsin Bioenergy Initiative and the Wisconsin Energy Institute – both tied to the UW-Madison campus – described a broad range of research under way.

For the short term, UW-Madison researchers are focused on efficiency and green construction, “smart grid” technologies for electricity transmission and management, automotive engine research and next-generation nuclear fission plants. Mid-term projects include cellulosic biofuels, advanced wind power generation, advanced nuclear power technologies and energy storage. Longer-term projects include nuclear fusion, photovoltaics and fuel cells.

The campus spends about $75 million per year on energy-related research, with 130 projects spread across the campus.

Troy Runge, director of the Wisconsin Bioenergy Initiative, described Wisconsin as uniquely positioned to “return to our roots” and develop biofuels and other bio-based products from sustainable resources readily available, such as farmland, forests and waste materials. Existing federal and state goals call for converting about 1 billion tons of plant biomass to biofuels every year by 2025, Runge noted, “and we’re in a strong position to be a big part of that.”

Of course, there will be bumps along the road, regardless of technology. Some examples:

* A recent federal Energy Department report noted that wind power could become a major source of electricity within 15 years, but the nation may need to spend $100 billion to put the necessary power grid in place.

* The world’s second-largest solar plant is under construction in sunny Florida, but even at 500 acres its shimmering panels will produce only 75 megawatts of power – a fraction of what conventional power plants crank out every year.

* From algae to beets, from switchgrass to paper waste, scientists are looking for new ways to tap the potential of biofuels. The challenge is to produce those fuels by the millions of gallons, versus the hundreds, and at a price that competes with fossil fuels. There are also necessary questions to be answered about diverting land that could be used to grow food to supply biomass for fuel production.

Can science and the marketplace get us there? In time… yes. The first computer in the 1940s weighed 30 tons, occupied 1,800 square feet and burned electricity by the megawatt. Today, a single desktop computer has a couple of thousand times more processing power and millions of times more data storage capacity. And it takes up almost no space.

It wasn’t government mandates that transformed computing, but innovation and market demand. Those same forces will drive the generation, storage and transmission of clean energy, with or without a new state law.

-- Still is president of the Wisconsin Technology Council. He is the former associate editor of the Wisconsin State Journal. To learn more about the Wisconsin Bioenergy Initiative and the Wisconsin Energy Institute, visit http://www.wbi.wisc.edu and http://www.energy.wisc.edu


Sunday, April 25, 2010

Congressional action will boost adoption of Clinical Decision Support

By Tom Burzinski
U.S. health care has lagged behind other industries in using Information Technology (IT) to provide consumers with services that are innovative, consistent, and affordable and that improve clinical outcomes. Recently, however, U.S. health care has begun to see IT as a significant enabler of care quality, operational efficiency, and business agility, instead of just a tool to control costs. This change in mindset is being spurred, in part, by two landmark pieces of legislation passed by Congress in the last 15 months.

Last year's American Recovery and Reinvestment Act (ARRA) allocated billions of dollars for health care IT advancement by providing incentives to hospitals and providers who deploy Electronic Health Record (EHR) systems and use them in a "meaningful manner." In addition, a number of provisions found within the sweeping health care insurance reform legislation approved by Congress in March will further accelerate the adoption of IT by health care organizations for the foreseeable future.

Major portions of this legislation encourage, or in some cases mandate, that U.S. health care organizations -- both providers and payers -- electronically capture large amounts of clinical and financial data as part of their day-to-day operations. The legislation then requires that health care organizations use this data to deploy robust Clinical Decision Support (CDS) capabilities whose goals include improving quality, accessibility, and affordability for all Americans.

In brief, clinical decision support aims to provide medical providers and their patients with what the Health Information and Management Systems Society (HIMSS) calls "the Five Rights:" 1) the right information; 2) to the right person; 3) in the right format; 4) through the right channel; 5) at the right point in the clinical workflow.

When properly architected, deployed, and accepted (a major task in itself) CDS can:
* detect potential safety and quality problems and help prevent them;
* detect inappropriate utilization of services, medications, and supplies;
* foster the greater use of evidence-based medicine principles and guidelines;
* organize, optimize and help operationalize the details of a plan of care; and
* ensure that the best clinical knowledge and recommendations are utilized to improve health management decisions by clinicians and patients.

In addition, CDS can assist an organization in meeting national reporting goals, certifications, pay-for-performance initiatives, as well as interoperability and health exchanges, among other things.

Over the years, numerous studies have shown that CDS prevents errors, reduces adverse health events, and improves quality through the use of physician alerts, reminders, care appropriate reference materials and tailored forms and order sets. Meeting the quality goals set forth in the recent healthcare legislation -- especially the criteria for obtaining the financial incentives offered for meaningful use of EHRs -- has catapulted Clinical Decision Support to the top of most health care CEOs' agendas. This heightened focus will certainly increase the amount of money and resources allocated to CDS design and deployment in the coming years.

Organizations willing to spend the money and time to deploy or enhance their CDS capability in 2010 will be in a position to reap the benefits offered by this landmark legislation well into the future.

-- Burzinski is the director of the Health Care IT practice and the IT Business Consulting practice at Skyline Technologies. If you are looking for more information on meaningful use, CDS, or other recent health care legislation related to IT, Tom can be reached at 920-593-3651 or tburzinski@skylinetechnologies.com.


Thursday, April 22, 2010

GreenBiz: Businesses join in on 'Earth Month' in La Crosse

By Gregg Hoffmann
LA CROSSE -- Earth Day has been expanded to Earth Month in this river town and the surrounding area.

The La Crosse Earth Week Coalition and other businesses and organizations have come together to stage a variety of "green" events. Mayor Matt Harter and County Board member Jai Johnson issued a proclamation at the start of the month proclaiming April "Earth Month."

Events have been held throughout the community, in schools and elsewhere. Several entertainment and education events are scheduled for Earth Day today.

Businesses also have been part of the month long celebration. A Green Expo, set for this Saturday at Western Tech's Lunda Center, will feature business vendors involved in "Green Homes" and "Green Transportation."

Topics ranging from Compressed Natural Gas (CNG) cars to geothermal heating and energy efficient bathrooms are among the featured green offerings at the Expo.

"We have a real variety of topics at the Expo," said Rebecca Brown, co-chair of the La Crosse Earth Week Coalition. "A core of 18 individuals has been meeting for months on planning the whole month, but it's become a real community event. We have 32 partners, which are non-profits, and 30 sponsors, which come primarily from the business community."

Honda Motorwerks is one of those sponsors. Chris Schneider, the owner, will speak about green transportation and also has donated one month free use of a Honda CNG auto as a door prize.

Schneider, who bills himself as the "Hybrid Guru," conducts CNG and hybrid clinics on a regular basis. "We have been talking about alternative energy vehicles here for over 10 years and over that period of time we have been able to double our employment," Schneider said.

Roald Gundersen, a builder of whole tree homes, will present a workshop. On Sunday, a tour of Driftless Farm, where Gundersen has built his own home using all of the trees with virtually no waste, will be conducted.

Another tour of a home, owned by Guy and Joan Wolf, which uses geothermal energy also is planned. A workshop on that topic is set for the Expo.

Earlier in the month, tours were conducted of area farms that are involved in the Community Supported Agriculture movement. Organic Valley, the dairy cooperative based in La Farge, is one of the sponsors of the Expo.

The Driftless Regional Bicycle Coalition will present a workshop on bicycle commuting and have a booth at the Expo. The city of La Crosse police department will display a propane-powered squad car.

Driftless Solar LLC, based in Spring Green; Enercept, a West Salem provider of structured insulated panels; First Supply, a La Crosse supplier of solar panels, and Fowler & Hammer, a La Crosse company specializing in environmentally-certified construction and renovation, are just some of the alternative construction companies that will have spaces at the Expo.

Green efforts of Gundersen Lutheran Hospital have been documented in the GreenBiz feature before. Gundersen is a major sponsor of Earth Month and will have a booth at the Expo.

The Green Expo is being held in conjunction with an Earth Fair at the Three Rivers Waldorf School. A shuttle bus will transport people between the two events.

La Crosse decided to make an extra effort to expand the traditional Earth Day last year, when it went to a week-long celebration. This year's full month celebration is being done in recognition of the 40th anniversary of Earth Day.

"There have been things going on almost daily throughout the month and they will continue for the rest of the month," Brown said.

On Earth Day itself, three-time Grammy Award winner Bill Miller will join with regional musician Dan Sebranek in a concert that has sold out. Miller also will present "Sacred Ground" -- an inspirational presentation from a Native American perspective -- during the day at Viterbo Fine Arts Center.

After the weekend, children's singer Hans Mayer will perform two concerts at Myrick Hixon EcoPark on Friday and Saturday, April 30 and May 1. Mayer has recorded "It's Our World: The Green Album" for children.

More information on all events for Earth Month can be found at www.greenlacrosse.com.

Brown said it has been very impressive how the business, governmental, non-profit, educational and other sectors of the La Crosse area have come together. "There truly has been a commitment made here," she said.

"I hope that the (attendees) can learn something about sustainable and how much the community is behind us," Brown added. "I know personally I was doing stuff at home and felt kind of isolated and alone, and then I found these people and though, 'Well, I'm not the only one'."

-- Hoffmann has written many columns and features for WisPolitics.com and WisBusiness.com over the years. He will write the GreenBiz column monthly.


Wednesday, April 21, 2010

Taking pot shots at angels: Federal regulation could kill investing

By Tom Still
George Bernard Shaw, the Irish author, wrote that "in heaven an angel is nobody in particular."

Sadly, the same appears to be true in Congress these days.

In the rush to punish Wall Street for sins real and imagined, Capitol Hill may also precipitate a fall from grace for a class of Main Street financiers essential to America's innovation economy: angel investors.

The financial sector reform bill being pushed by U.S. Sen. Christopher Dodd, D-Conn., takes direct aim at the wings of angel investors for reasons that defy explanation. If passed, this "Washington-knows-best" attempt to regulate some of the nation's most productive risk-takers could destroy the entrepreneurial economy.

Angel investors are often entrepreneurs who hit a home run in their own start-up businesses and who want to reinvest in other young companies. Angel investors are generally strong business executives with an eye for innovation, and they're not afraid to take a calculated gamble on companies that are too new to get financing from venture capitalists or too risky for banks.

They usually invest close to home and most often as individuals or within a family, but increasingly angels invest as members of angel networks or angel funds that offer some safety in numbers and more partners to screen potential deals.

In Wisconsin, angel investors have been in the vanguard of fostering the state's early stage economy. Five years ago, there were only a handful of angel networks in Wisconsin. Today, there are nearly two-dozen networks and funds -- and they're not shy about rolling the dice on Wisconsin companies in sectors such as biotechnology, information technology, medical device, advanced manufacturing and "cleantech."

In 2009, when most economic indicators were headed south, angel investors in Wisconsin actually took part in more deals and invested more money than in any previous year. Preliminary data from the Wisconsin Angel Network shows that while venture capital investing was down in 2009, as it was nationally, angel investing here increased.

But if Dodd has his way, these individualistic investors will be regulated out of existence.

The Restoring American Financial Stability Act, of which Dodd is the chief sponsor, would tighten regulation of the nation's financial system in ways large and small. It contains three provisions that would effectively kill angel investing in the United States:

* It would require start-up companies to register with the federal Securities and Exchange Commission, and wait at least 120 days for SEC review, before trying to raise money. Currently, fledgling companies can raise money from accredited investors without regulatory approval. Four months is an eternity in the life of a start-up company, and most would die in the vine before they ever get a chance to grow.

* It would redefine who is an angel. Accredited investors, who are people deemed wealthy enough to invest in start-ups, would be limited to those individuals with more than $2.5 million in assets (up from $1 million today) or a personal income of $450,000 per year (up from $250,000). This will dramatically decrease the supply of angels, which the University of New Hampshire's Center for Venture Research estimated at 259,000 in 2009. Those angels invested $17.6 billion in about 57,000 deals.

* It would subject investors and start-up companies to state-by-state rules versus a single set of SEC standards. Along with the new SEC filing requirement, that would add red tape, time and cost to the investment process.

In its frenzy to clamp down on Wall Street, Congress is threatening an investment community that fosters innovation, mentors young companies and generally cares about how the economy is faring where they live. Angels have helped to create some of today's biggest companies -- Apple, Amazon, Google and many more -- usually without putting anyone's money at risk other than their own.

Angel investing isn't perfect; the average return on investment proves that. But it's precisely the kind of bottom-up, largely self-regulated economic activity the nation needs as it struggles to create new companies and jobs. Only those federal lawmakers intent on a top-down, command-and-control economy would think otherwise.

-- Still is president of the Wisconsin Technology Council. He is the former associate editor of the Wisconsin State Journal in Madison. Read more about angel investing at www.wisconsinangelnetwork.com


Monday, April 19, 2010

Don't break out the champagne quite yet

By James A. Buchen
Another tax day has come and gone but concerns about the Wisconsin tax burden are as high as ever. Why is there a seemingly endless debate on this topic?

Probably because most individuals and businesses think their tax burden is too high -- regardless of what the tax rankings say. And speaking of rankings, the Census Bureau places Wisconsin's overall state and local tax burden at 14 highest among the 50 states in fiscal year 2006-2007.

That's good news for a state that has hovered in the top ten for decades.

Is it time to break out the champagne and declare victory?

Not quite yet. The Washington D.C. based Tax Foundation, which publishes a more up-to-date ranking says that we slipped back to 9th highest in 2008. And it gets worse. In the most recent State Budget the Legislature and the Governor raised taxes by nearly $3 billion -- among the largest tax increased in state history. It includes a 25 percent increase in corporate taxes, higher capital gains taxes, and a new top personal income tax bracket. Together they represent a larger tax increase for Wisconsin than almost any other state in the country. Experts believe these recent tax hikes will push our ranking even higher next year.

Most people understand that government spending drives taxes, and recent spending increases are another reason to be concerned as we look to the future. The State Budget included a 10 percent spending increase and a multi-billion dollar deficit, creating more pressure to raise taxes in the future. On top of that, the legislature loosened controls on school district spending and teacher salary increases. That will drive property tax hikes and increased state spending for school aids -- already more than 40 percent of the state general purpose revenue budget.

Some people believe that the solution to Wisconsin's tax and spending problems lies in changing the mix of taxes we impose on individuals and businesses. They argue that we should rely more heavily on sales taxes and user fees, two areas where our tax rankings are lower compared to other states. While this approach may have some appeal, be wary of politicians promising to raise one tax to lower another.

The history of taxation in Wisconsin, and arguably the reason we have a relatively high tax burden, is that the legislature created new taxes and increased them over the years based on the argument that the new revenue would be used to lower another tax.

In 1911, the legislature created the first state personal income tax in the nation arguing that they would use the proceeds to lower property taxes. Similarly, when the sales tax was first established in the early l960's, the rallying cry was "property tax relief." Each time the sales tax was increased, from 3 percent to 4 percent and then to 5 percent and then an additional half percent for counties, it was for -- you guessed it -- property tax relief.

So what kind of an impact did all that tax shifting have on Wisconsin's tax burden? Well, today we have both high income taxes and high property taxes, and a high overall tax burden that promises to get worse in the years ahead.

The obvious answer to the tax problem is to limit the growth in government spending at all levels. If we could limit the growth in government spending to a level that is slower than the growth in personal income, the tax burden would shrink over time. Conversely, if government spending grows faster than personal income, a larger and larger share of our families' resources will be consumed by taxes, leaving less and less for food, clothing, shelter and discretionary spending.

At the core, these issues are not complicated or difficult for our families to understand. What we need now is a new generation of political leaders with the will and fiscal discipline to pursue these common sense reforms.

-- Buchen is vice president of government relations for WMC, which represents 4,000 businesses in Wisconsin. WMC is dedicated to making Wisconsin the most competitive state in the nation.


Friday, April 16, 2010

Wisconsin tax ranking improves, but still work to be done

By Brian Taffora
Wisconsin has never been known for its low tax burden. Even among those who didn't believe Wisconsin was a "tax hell," as some have called it, none have said that Wisconsin's tax climate was ideal.

But a recent report prepared by Ernst and Young for the Council on State Taxation ranked Wisconsin's state and local tax burden on businesses 30th in the country -- significantly better than the national average.

In addition, an investigation by the Milwaukee Journal Sentinel found that while Wisconsin tends to rank poorly when only income and property taxes are considered, once various fees are taken into account -- such as toll roads and vehicle registration -- Wisconsin's ranking falls close to the national average.

And a new Department of Revenue report shows that Wisconsin has made a great deal of progress over the past several years in reducing the tax burden on citizens and businesses.

The DOR report found that Wisconsin's state and local tax rankings dropped to 15th per $1,000 of personal income and 21st per capita among the 50 states and the District of Columbia. That's the best ranking for the state in nearly 50 years -- since the 1961-62 fiscal year.

Wisconsin was also near the national average in terms of general revenue collected at 24th per $1,000 of income and 25th per capita -- the lowest level for the state in the history of the U.S. Census Bureau data.

All of this new data adds up to good news for Wisconsin.

Because of the good work done by Governor Doyle and the leadership in the state Legislature -- both Republican and Democratic -- Wisconsin has fallen out of the top ten "worst taxed" states, and continues to fall. Since Wisconsin was ranked 16th in the 1961-62 fiscal year, the state has only been out of the top ten three times since. Once was in FY 1979-80, and the other two were in FY 2005-06 and FY 2006-07 -- the two most recent fiscal years examined by the state Department of Revenue.

This isn't exactly cause for celebration. No longer being among the top ten worst taxed states in the nation - while certainly an improvement -- is not the goal we should set for ourselves. Clearly, more work needs to be done to further bring down the tax burden and make Wisconsin more competitive in attracting companies and highly skilled workers to our state.

But it's also clear that we're on the right track. Our state and local taxes -- relative to the national average -- have consistently fallen almost every year for the past decade, and that bodes well for the future competitiveness of our state. That is the direction we must continue.

We look forward to working with the Doyle administration, the next administration, and leaders in the state Assembly and Senate to improve Wisconsin's tax climate and grow new, well paying jobs in our state.

-- Taffora is the vice president of government relations & operations for the Wisconsin Business Council, an organization that seeks to support Wisconsin's economic climate and quality of life through collaboration, improved public policy, and private sector initiatives. For more information, please visit www.wibusiness.org.


Thursday, April 15, 2010

Outdated law costs consumers on prescription drugs

By Lisa Nelson
An outdated law is preventing Wisconsin consumers from saving money, and it's time we change that law.

Last week a handful of state Senators voted to make sure that doesn't happen. Senators Vinehout, Schultz and Kapanke voted no to move Assembly Bill 482 to the full Senate. This bill would exempt prescription drugs from this law, giving Wisconsin consumers access to lower prices consumers enjoy in most other states.

At Walmart, we have a generic prescription drug program offering more than 300 generic prescriptions at the price of $4 -- but not in Wisconsin. Some are priced higher in Wisconsin due to this law. As of March 2010, Walmart estimates it has saved Wisconsin customers more than $41 million since launching the program in September of 2006.

This savings would be millions more if we could offer the entire $4 program. Not to mention, this is the customer savings from only Walmart's program in Wisconsin, and does not include savings from other retailers that offer similar pricing. This $4 generic pricing has been a game-changer in increasing the affordability of prescription drugs.

The bill passed the Assembly Health Committee with a 10-2 majority, and passed the state Assembly. It's sponsored by Republicans and Democrats, and supported by a diverse coalition of groups representing labor, business, health care, seniors and local government. Newspapers across the state, economists and think tanks have opined that it's time for these kinds of laws to be taken off the books.

This is a simple health care reform that costs government nothing. In fact, by removing this price barrier, there could be significant cost savings to taxpayers in the prescriptions we pay for through government programs.

So what's the problem? Opponents argue their businesses can't survive with a low price business model, and this repeal will lead the way to similar reforms lowering the price of gas and other products. They claim there will be illegal "predatory" pricing through below cost promotions. However, the truth is that federal anti-trust laws already provide protection against inappropriate predatory pricing activities and AB 482 includes a predatory pricing provision.

Competition has changed since this law was created in 1939. Competition is no longer just down the street, it is increasingly global, immediately accessible and open for business 24 hours a day. When businesses rely on government intervention to succeed or survive, it disincentivizes the very innovation and creativity spurred by competition, necessary in a free market system, and critical to the health of our Wisconsin economy.

This law puts Wisconsin consumers at a disadvantage. There is no reason we should pay more than anyone else for our prescription drugs. Call your state senator today at 1-800-362-9472 and ask them to pass AB482 before the legislature adjourns.

-- Nelson is a senior public affairs manager for Walmart.


Monday, April 12, 2010

Wisconsin's 'race to the top' in education will always begin at home

By Tom Still
Wisconsin's bid for federal "race to the top" education grants got a mediocre C-minus from the reviewers at the U.S. Department of Education, who said the state's application fell short in some crucial ways. Most notably, the feds said, Wisconsin needed more robust plans for improving student achievement as well as the effectiveness of teachers.

Wisconsin will get a chance to score higher in the second round of the federal competition, but it will take lots of homework to whip the state's application into shape.

The idea of federal challenge grants to reform elementary and secondary education is commendable, given the importance of education to a secure, prosperous nation, but it's important to note Washington has historically played a limited role in how states and communities run their schools. In fact, well over 90 percent of all funding for local schools comes from the states and communities themselves -- and Wisconsin is typically ranked among the bottom five states in receiving federal aid.

In short, the "race to the top" in Wisconsin will likely be won or lost on the strength of decisions made here -- by parents, teachers, school officials, policymakers and students.

That begins with a commitment to excellence and recognition that Wisconsin needs a better educated workforce to compete in the global economy. Let's take science and technology education as an example.

A generation ago, the United States was third per capita in the world in producing engineers -- a key indicator of science and technology dominance. Today, the nation is 17th in the world. In part, that's because emerging nations are catching up. But it's also because fewer students are getting turned on to science, technology, engineering and math at an early age.

Wisconsin doesn't need a federal grant to know what works in that arena. Many school districts are revising their science and technology curricula with the help of proven private strategies such as Project Lead the Way, Science Olympiad and First Robotics. These programs are helping entire districts, schools or individual teachers do a better job of exciting students at a critical age.

Such innovation comes at a critical time -- and amid signs of some progress. National math scores released last October have risen 20 points for eighth graders and 27 points for fourth graders since 1990, according to 2009 test results. That means fourth graders knew about two-and-a-half years' more math than 1990 fourth graders. But in the most recent period, from 2007 to 2009, math scores failed to rise much, according to the National Center for Education Statistics.

There's pretty good evidence about what works. High-quality early childhood programs help many kids from falling behind. Intensive efforts in the ninth grade -- sometimes called education's "Bermuda Triangle" -- work when core classes such as math are made more challenging. Career academies and other efforts to link employers into the classroom also work, especially with science and math programs.

While Wisconsin students perform ahead of the national average in many ways, segments of the state's K-12 population are failing to gain the science, technology, engineering and math skills they need to become successful workers in a global economy. Many students, particularly young women, lose interest in science and math by the time they've completed middle school. Too many students are not exposed to careers that may not require a four-year college degree -- but which require a strong working knowledge of science and math.

Some people mistakenly believe there are only a few science, technology, engineering and math jobs out there. The state Department of Workforce Development has estimated that one in 10 Wisconsin jobs is a so-called "STEM" job. It has also predicted that STEM jobs will be among the fastest-growing occupations in the state.

The "race to the top" for education excellence in Wisconsin begins at home, no matter what transpires over time with the federal grant. The real prize is a stronger economy driven by a well-educated workforce.

-- Still is president of the Wisconsin Technology Council. In 2009, the Tech Council issued "Educating a Tech-Savvy Workforce for Wisconsin," a report on science, technology, engineering and math education in Wisconsin. Read more at http://wisconsintechnologycouncil.com/uploads/Tech-Savvy_WhitePaper_FINAL.pdf


Thursday, April 8, 2010

What small businesses need to know about the new health care law

By Dan Danner
The long debate over health care reform has ended, leaving many small business owners more confused than ever over what to expect. But they know one thing -- they'll be paying for it for years to come.

The package won't be fully implemented until 2018. However, there are important provisions that will be effective this year, in 2011 and 2012 that entrepreneurs need to begin planning for now. The changes largely involve new taxes, fees and mandates on individuals and small business.

In 2010, a temporary tax credit will be available for a limited number of firms who provide qualified health coverage. However, the credit puts small business owners through a series of complicated tests to determine the amount of the credit. Only firms with 10 employees or less will receive the full credit. For firms with 11-25 employees, the credit is reduced per employee. Firms with more than 25 employees will get no credit at all.

In addition, only firms who pay their workers an average of $25,000 or less are eligible for the full credit. The credit is reduced as the average wage goes up, stopping when it reaches $50,000. Also, only firms that cover 50 percent or more of insurance costs will be eligible. Even if your business is one of the 12 percent that will qualify, the credit is only available for six years.

In the meantime, other provisions that will drive up costs include an assault on one particular industry, a 10 percent tax on indoor tanning services begins July 1.

Beginning in 2011, new changes take effect that will increase costs and limit choices. Those changes include:

* New limits on HSAs and FSAs -- Consumers will be prohibited from using health savings accounts and flexible spending funds to purchase non-prescribed items, including over-the-counter medication (except insulin).

* Federally subsidized long-term care -- Small businesses may voluntarily participate in a new long-term care program. Participating firms' employees will be automatically enrolled and subject to payroll deductions unless they choose to opt out. This program means more paperwork and will almost certainly cost far more than what the deductions will cover.

* A brand-name drug tax -- Manufacturers and importers of brand-name drugs will pay a tax of $2.5 billion in 2011, $3 billion per year for 2012 through 2016, $3.5 billion for 2017, $4.2 billion for 2018, and $2.8 billion for 2019 and thereafter. This tax is certain to be passed along to consumers.

In 2012, small business owners will face a tremendous new burden. They will have to send to the IRS a Form 1099 for each and every business-to-business transaction of $600 or more. We expect that the IRS will hire as many as 12,000 new auditors.

Further out, we'll see new taxes, an expensive, federally mandated minimum benefits package, and additional complex mandates on individuals and employers who will face penalties if they don't comply.

In the meantime, small business owners will struggle trying to gauge the costs and understand the impact of a new law they neither wanted nor asked for, rather than the solutions that would actually help them cope with the rising costs of health care. No doubt when November comes, small business owners will remember who forced this reform on them and cast their vote accordingly at the ballot box.

-- Danner is president and CEO of the National Federation of Independent Business in Washington, D.C.


Wednesday, April 7, 2010

The shield of public health

By Seth Foldy
When you buy food, go to work, drive a car, have a baby, attend school, go swimming, and even to go to the doctor, a public health worker has often helped make it safer and healthier. National Public Health Week (April 5-11) recognizes these professionals who through interlocking national, state, local and tribal health departments and their many community partners in health care, business, education, and other fields, create a shield against illness and injury.

The public health shield protects the quality of food and water and controls toxin and radiation exposures. It covers swimming pools, restaurants, campgrounds and hotels.

The shield protects children and adults with vaccines like the ones that eliminated smallpox and allowed diseases like tetanus, diphtheria and even measles to be nearly forgotten.

The shield responds with speed and compassion when disease outbreaks or disasters strike. Within months of the discovery of H1N1 influenza, over 1.2 million Wisconsin residents had been vaccinated, and thousands of ill received treatment from medication stockpiles. The shield also blocks disease outbreaks and supports the health system after floods and other disasters.

The shield helps pregnant women get care and nutrition and screens newborns for hidden diseases that maim and kill. It provides the birth certificate!

It protects children against poisoning, burns, and asthma. It helps protect kids from hunger—but also from obesity. It stands between children and tobacco, alcohol and other drugs. It helps young people avoid injury, unintended pregnancy and sexually-transmitted diseases.

The public health shield detects and attacks silent killers like high blood pressure, diabetes, undetected cancers, and unrecognized depression. It assures the ambulance squad is well-trained, and lowers the risk of coming home from a hospital with more infections than you entered with. It tracks and responds to rates of disease and injury in your community—otherwise they might grow unnoticed.

If this sounds like a magic, invisible shield, it isn't. An ounce of protection is worth a pound of cure, so complaints about its cost are rare. You may only really notice the shield when it fails.

Those who suffer the most when the shield is weak are the most vulnerable: the poor, the young, the elderly, and those suffering illness or disability. But all people benefit from public health.

The public health shield is made of people with diverse training who are passionate about prevention. Epidemiologists study patterns of illness and injury to identify prevention opportunities. Laboratory science detects and measures hazards. Environmental and occupation health help eliminate or shield hazards. Health educators and promoters help create healthy behaviors. Nurses, doctors, and outreach workers teach, vaccinate, diagnose, treat, counsel, screen, refer—and most of all, connect. These are just a few.

The highest public health achievement is forging policies that protect over the long run. Before milk pasteurization and water treatment were required a shocking proportion of children died routinely from diarrhea in Wisconsin. More recently increased tobacco taxes lower teen smoking rates; smoke-free air laws eliminate exposure to cancer-causing chemicals; laws have reduced children's exposure to poisonous lead.

National public health week is an opportunity to notice this almost invisible shield and the professionals that forge it. It is also a good time to get involved. Consider calling your local health department to discuss ways to help implement your community's Health Improvement Plan. There is room for everybody to be part of the shield, as well as to be protected under it.

-- Foldy is a state health officer and administrator of the Wisconsin Division of Public Health.


Thursday, April 1, 2010

Real estate struggles: Now's a good time to consider that kiddie condo

By Kevin Reardon
Are you a parent with investment dollars to spare in deflated, college-area real estate markets? If so, there's never been a better time to invest in condos or single-family homes to house a student during their undergraduate or graduate years. This is an investment that will provide tax breaks and potential investment appreciation.

An estimate by the National Association of Realtors concludes there are approximately 3 million campus houses and condos in America today. These are properties that were purchased primarily for the owners' college-bound students. This number represents about 8 percent of the nation's 37.4 million investment properties. However, it excludes 6.8 million vacation homes, which don't tend to be near college campuses.

It is very important to consider pros and cons because the potential rewards of buying housing for a student carries many risks. Over the past decade, the once-galloping real estate market made condo and home purchases in college areas attractive to parents looking for an actual return on the room and board expenses they would otherwise throw away to their kids' schools. With the double-digit home appreciation of the 1990s, parents looked at buying property as a way to essentially house their kids for free.

Today, in most markets, home values have fallen, which makes for a better investment proposition. But it's critical to talk to tax and financial experts such as a Certified Financial Planner professional. As a starting point, parents need to consider the following:

How responsible is your kid?
If your kid thinks you're buying them a crash pad or party palace, you're already in trouble. He or she will have to be responsible enough to act as an onsite landlord making sure the interior and exterior of the property stay in livable and salable condition. That's not a job that every child can handle, so unless you can afford housekeeping and maintenance help, any doubts on your part should dissuade you from such a purchase. Also, if you have ANY suspicions that your child might drop out, take a break or transfer from his/her chosen school, do you want to risk becoming a landlord yourself or paying for an empty property?

How's your cash flow?
If you are already a homeowner, you know what owning a home costs -- mortgage payments, property taxes, insurance, homeowners or condo association dues, maintenance costs -- can you cover these things in a remote residence (including emergencies) without batting an eye? And keep in mind that those costs are going to be considerably higher for your kid's property in downtown Chicago than they would be in Omaha. Also, keep in mind that it will cost considerably more to insure this property because even though it's your kid, you'll essentially need to be insured as a landlord based on the damage that can occur in rental properties.

When would you have to sell?
Most people think in terms of owning a kiddie condo for four years -- the term of a standard degree. A decade ago, that was a relatively easy commitment to make as housing prices were skyrocketing and buyers always seemed to be circling. Today, however, owners have to consider that it may take them considerably longer to sell the property at a profit with necessary investments in maintenance along the way, and a big 5 to 6 percent slice off the top to pay a selling broker.

Location, location, location:
Buying a property in the immediate vicinity of campus might be great for your kid who rolls out of bed late for class, but bad for you if you're expecting your property to appreciate. In most markets, on-campus real estate is notoriously low on appreciation (think how you'd feel buying next door to Animal House). This is why investors do better buying in established, off-campus residential areas or developments that are near but not on campus. Your child will have to miss the experience of living with their peers, though, and that's a big consideration.

Can the property do double duty?
Students are pretty possessive about their space and privacy in college, which is why you don't see many parents crashing in their kids' dorm rooms for the weekend. But if you have regular business or vacation plans in the city where your kid goes to school, see if that might be one more incentive to invest as long as it doesn't cramp your style or your kid's.

Might your investment become your kid's investment?
Again, this requires sensible planning and the full cooperation of a responsible child. However, if your child is planning to stay in the city where they've graduated, parents might consider a plan to sell the property to their kids at graduation. This could give the grad a great start on their finances during their first earning years.

Is buying a Kiddie Condo the right approach for you and your family? Before you pull the trigger, follow that advice parents are always giving their kids: Do your homework!

-- Reardon is owner & president of Brookfield-based Shakespeare Wealth Management Inc.


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