Health Equity Principles for State and Local Leaders in Responding to, Reopening and Recovering from COVID-19

https://www.rwjf.org/en/library/research/2020/05/health-equity-principles-for-state-and-local-leaders-in-responding-to-reopening-and-recovering-from-covid-19.html

Centering Health Equity in COVID-19 Response and Recovery Plans ...

Health equity means that everyone has a fair and just opportunity to be as healthy as possible. This requires removing obstacles to health such as poverty, discrimination, and their consequences, including powerlessness and lack of access to good jobs with fair pay, quality education and housing, safe environments, and health care.”

COVID-19 has unleashed a dual threat to health equity in the United States: a pandemic that has sickened millions and killed tens of thousands and counting, and an economic downturn that has resulted in tens of millions of people losing jobs—the highest numbers since the Great Depression. The COVID pandemic underscores that:

  • Our health is inextricably linked to that of our neighbors, family members, child- and adult-care providers, co-workers, school teachers, delivery service people, grocery store clerks, factory workers, and first responders, among others;
  • Our current health care, public health, and economic systems do not adequately or equitably protect our well-being as a nation; and
  • Every community is experiencing harm, though certain groups are suffering disproportionately, including people of color, workers with low incomes, and people living in places that were already struggling financially before the economic downturn.

For communities and their residents to recover fully and fairly, state and local leaders should consider the following health equity principles in designing and implementing their responses. These principles are not a detailed public health guide for responding to the pandemic or reopening the economy, but rather a compass that continually points leaders toward an equitable and lasting recovery.

 

Collect, analyze, and report data disaggregated by age, race, ethnicity, gender, disability, neighborhood, and other sociodemographic characteristics.

Pandemics and economic recessions exacerbate disparities that ultimately hurt us all. Therefore, state and local leaders cannot design equitable response and recovery strategies without monitoring COVID’s impacts among socially and economically marginalized groups.¹ Data disaggregation should follow best practices and extend not only to public health data on COVID cases, hospitalizations, and fatalities, but also to: measures of access to testing, treatment, personal protective equipment (PPE), and safe places to isolate when sick; receipt of social and economic supports; and the downstream consequences of COVID on well-being, ranging from housing instability to food insecurity.

Geographic identifiers would allow leaders and the public to understand the interplay between place and social factors, as counties with large black populations account for more than half of all COVID deaths, and rural communities and post-industrial cities generally fare worse in economic downturns. Legal mandates for data disaggregation are proliferating, but 11 states are still not reporting COVID deaths by race; 16 are not reporting by gender; and 26 are not reporting based on congregate living status (e.g., nursing homes, jails). Only three are reporting testing data by race and ethnicity.

While states and cities can do more, the federal government should also support data disaggregation through funding and national standards.

Include in decision-making the people most affected by health and economic challenges, and benchmark progress based on their outcomes.

Our communities are stronger, more stable, and more prosperous when every person, including the most disadvantaged residents, is healthy and financially secure. Throughout the response and recovery, state and local leaders should ask: Are we making sure that people facing the greatest risks have access to PPE, testing and treatment, stable housing, and a way to support their families? And, are we creating ways for residents—particularly those hardest hit—to meaningfully participate in and shape the government’s recovery strategy?

Accordingly, policymakers should create space for leaders from these communities to be at decision-making tables and should regularly consult with community-based organizations that can identify barriers to accessing health and social services, lift up grassroots solutions, and disseminate public health guidance in culturally and linguistically appropriate ways. For example, they could recommend trusted, accessible locations for new testing sites and advise on how to diversify the pool of contact tracers, who will be crucial to tamping down the spread of infection in reopened communities. They could also collaborate with government leaders to ensure that all people who are infected with coronavirus (or exposed to someone infected) have a safe, secure, and acceptable place to isolate or quarantine for 14 days. Key partners could include community health centers, small business associations, community organizing groups, and workers’ rights organizations, among others. Ultimately, state and local leaders should measure the success of their response based not only on total death counts and aggregate economic impacts but also on the health and social outcomes of the most marginalized.

Establish and empower teams dedicated to promoting racial equity in response and recovery efforts.

Race or ethnicity should not determine anyone’s opportunity for good health or social well-being, but, as COVID has shown, we are far from this goal. People of color are more likely to be front-line workers, to live in dense or overcrowded housing, to lack health insurance, and to experience chronic diseases linked to unhealthy environments and structural racism. Therefore, state and local leaders should empower dedicated teams to address COVID-related racial disparities, as several leaders, Republican and Democrat, have already done.

To be effective, these entities should: include leaders of color from community, corporate, academic, and philanthropic sectors; be integrated as key members of the broader public health and economic recovery efforts; and be accountable to the public. These teams should foster collaboration between state, local, and tribal governments to assist Native communities; anticipate and mitigate negative consequences of current response strategies, such as bias in enforcement of public health guidelines; address racial discrimination within the health care system; and ensure access to tailored mental health services for people of color and immigrants who are experiencing added trauma, stigma, and fear. Ultimately, resources matter. State and local leaders must ensure that critical health and social supports are distributed fairly, proportionate to need, and free of undue restrictions to meet the needs of all groups, including black, Latino, Asian, and Indigenous communities.

 

Proactively identify and address existing policy gaps while advocating for further federal support.

The Congressional response to COVID has been historic in its scope and speed, but significant gaps remain. Additional federal resources are needed for a broad range of health and social services, along with fiscal relief for states and communities facing historically large budget deficits due to COVID. Despite these challenges, state and local leaders must still find ways to take targeted policy actions. The following questions can help guide their response.

Who is left out?Inclusion of all populations will strengthen the public health response and lessen the pandemic’s economic fallout for all of society, but federal actions to date have not included all who have been severely harmed by the pandemic. As a result, many states and communities have sought to fill gaps in eviction protections and paid sick and caregiving leave. Others are extending support to undocumented immigrants and mixed-status families through public-private partnerships, faith-based charities, and community-led mutual aid systems. Vital health care providers, including safety net hospitals and Indian Health Service facilities, have also been disadvantaged and need targeted support.

Will protections last long enough?Many programs, such as expanded Medicaid funding, are tied to the federal declaration of a public health emergency, which will likely end before the economic crisis does. Other policies, like enhanced unemployment insurance and mortgage relief, are set to expire on arbitrary dates. And still others, such as stimulus checks, were one-time payments. Instead, policy extensions should be tied to the extent of COVID infection in a state or community (or its anticipated spread) and/or to broader economic measures such as unemployment. This is particularly important as communities will likely experience re-openings and closings over the next six to 12 months as COVID reemerges.

Have programs that meet urgent needs been fully and fairly implemented?Allexisting federal resources should be used in a time of great need. For example, additional states should adopt provisions that would allow families with school-age children to receive added Supplemental Nutrition Assistance Program (SNAP) benefits, and more communities need innovative solutions to provide meals to young children who relied on schools or child care providers for breakfast and lunch. States should also revise eligibility, enrollment, and recertification processes that deter Medicaid use by children, pregnant women, and lawfully residing immigrants.

Invest in strengthening public health, health care, and social infrastructure to foster resilience.

Health, public health, and social infrastructure are critical for recovery and for our survival of the next pandemic, severe weather event, or economic downturn. A comprehensive public health system is the first line of defense for rural, tribal, and urban communities. While a sizable federal reinvestment in public health is needed, states and communities must also reverse steady cuts to the public health workforce and laboratory and data systems.

Everyone in this country should have paid sick and family leave to care for themselves and loved ones; comprehensive health insurance to ensure access to care when sick and to protect against medical debt; and jobs and social supports that enable families to meet their basic needs and invest in the future. As millions are projected to lose employer-sponsored health insurance, Medicaid expansion becomes increasingly vital for its proven ability to boost health, reduce disparities, and provide a strong return on investment. In the longer term, policies such as earned income tax credits and wage increases for low-wage workers can help secure economic opportunity and health for all. Finally, states and communities should invest in affordable, accessible high-speed internet, which is crucial to ensuring that everyone—not just the most privileged among us—is informed, connected to schools and jobs, and engaged civically.

These principles can guide our nation toward an equitable response and recovery and help sow the seeds of long-term, transformative change. States and cities have begun imagining and, in some cases, advancing toward this vision, putting a down payment on a fair and just future in which health equity is a reality. Returning to the ways things were is not an option.

Large, Troubled Companies Got Bailout Money in Small-Business Loan Program

Large, Troubled Companies Got Bailout Money in Small-Business Loan ...

Companies with accounting problems or in trouble with the government received millions in federal loans.

A company in Georgia paid $6.5 million to resolve a Justice Department investigation — and, two weeks later, received a $10 million federally backed loan to help it survive the coronavirus crisis.

Another company, AutoWeb, disclosed last week that it had paid its chief executive $1.7 million in 2019 — a week after it received $1.4 million from the same loan program.

And Intellinetics, a software company in Ohio, got $838,700 from the government program — and then agreed, the following week, to spend at least $300,000 to purchase a rival firm.

The vast economic rescue package that President Trump signed into law last month included $349 billion in low-interest loans for small businesses. The so-called Paycheck Protection Program was supposed to help prevent small companies — generally those with fewer than 500 employees in the United States — from capsizing as the economy sinks into what looks like a severe recession.

The loan program was meant for companies that could no longer finance themselves through traditional means, like raising money in the markets or borrowing from banks under existing credit lines. The law required that the federal money — which comes at a low 1 percent interest rate and in some cases doesn’t need to be paid back — be spent on things like payroll or rent.

But the program has been riddled with problems. Within days of its start, its money ran out, prompting Congress to approve an additional $310 billion in funding that will open for applications on Monday. Countless small businesses were shut out, even as a number of large companies received millions of dollars in aid.

Some, including restaurant chains like Ruth’s Chris and Shake Shack, agreed to return their loans after a public outcry. But dozens of large but lower-profile companies with financial or legal problems have also received large payouts under the program, according to an analysis of the more than 200 publicly traded companies that have disclosed receiving a total of more than $750 million in bailout loans.

Another dozen or so collected money even though they have recently reported being able to raise large sums through private means. Several others have recently showered top executives with seven-figure pay packages.

The government isn’t disclosing who receives aid, leaving it up to individual companies to decide whether to disclose that they obtained loans. That makes a full accounting of the loan program impossible.

“It’s outrageous,” said Amanda Ballantyne, the executive director of Main Street Alliance, an advocacy group for small businesses. She added that there were countless small business owners “who have laid off all their staff, are trying to file for unemployment and will go bankrupt because of the problems with the way this Paycheck Protection Program was designed.”

Applicants for loans do not need to provide evidence that they have been harmed by the pandemic. They simply need to certify that “current economic uncertainty makes this loan request necessary” to support their operations.

Instead of having the Small Business Administration, which is guaranteeing the loans, decide which companies get funding, the process was essentially outsourced to banks. The banks collect fees for each loan they make but don’t have to monitor whether the recipients use the money appropriately.

For small business owners shut out of the program, watching big companies collect loans while their applications languish has been infuriating.

“It has been beyond frustrating,” said Diane Burgio, a single mother who runs a design business in New York City that employs four people. She was one of more than 280,000 applicants who sought, and did not get, a loan from JPMorgan Chase.

The New York Times identified roughly a dozen publicly traded companies that had recently boasted about their access to ample capital — and then applied for and received millions of dollars in the federal loans.

Legacy Housing, a Texas company that manufactures premade homes, announced on April 1 that it had access to a new $25 million credit line. Curtis D. Hodgson, Legacy’s executive chairman, told investors that he expected any damage from the coronavirus to be short-lived. “Our order book is still strong, and we are well-positioned once the situation begins to normalize,” he said.

Less than two weeks later, on April 10, the company announced that a local lender, Peoples Bank, had approved it for $6.5 million under the S.B.A. loan program.

In an interview on Sunday, Mr. Hodgson said that an inquiry from The Times led the company to decide to give back the money it borrowed, though he defended seeking the loan in the first place. “Legacy is a highly leveraged company without cash on hand,” he said. “Here was a way to get a cash infusion.”

Escalade Sports, which makes things like table tennis tables and basketball hoops, already had a $50 million credit line from JPMorgan Chase. The company’s chief executive, Dave Fetherman, told investors this month that the company, based in Evansville, Ind., had “a strong balance sheet” and was seeing rising demand for its products, with so many Americans cooped up in their homes.

Days earlier, Escalade got a $5.6 million federally backed loan. A spokesman for Escalade said the company “fully met all required conditions at the time we applied for the P.P.P. loan.”

Executives at some companies said applying for the loans made clear business sense. The loans are essentially free money: They have rock-bottom interest rates and can be forgiven if, among other things, the borrower maintains the size of its work force. In some cases, executives said, their bankers encouraged them to apply for the loans.

At least seven companies that received a total of $45 million in loans under the federal government’s program have recently had serious scrapes with the federal government.

MiMedx Group, a biopharmaceutical company in Marietta, Ga., got a $10 million loan on April 21. On April 6, the company had agreed to pay the Justice Department $6.5 million to resolve allegations that it violated federal law by knowingly overcharging the Department of Veterans Affairs for medical supplies.

MiMedx, which makes and sells human tissue grafts, also ran into problems with the Securities and Exchange Commission. Last year, the agency sued MiMedx, accusing the company of exaggerating its revenue to investors over several years. MiMedx agreed to settle the case for $1.5 million, without admitting wrongdoing. Two of its former top executives were indicted last year by federal prosecutors in Manhattan on charges of accounting fraud.

A MiMedx spokeswoman, Hilary Dixon, said the company was trying to move past its accounting scandal. “We don’t have the option of raising capital in the public markets owing to our financial restatement process,” she said.

Another company, US Auto Parts Network, which received a $4.1 million loan through the program, has been in a heated dispute in recent years with Customs and Border Protection. The agency has seized some of the company’s imported products, claiming they are counterfeit.

US Auto Parts Network didn’t respond to requests for comment.

At least two companies that received federally backed loans have previously borrowed heavily from their own executives or others close to the firms — meaning that the new loans could help the companies repay their insiders.

Infinite Group, a cybersecurity firm in Pittsford, N.Y., had been borrowing hundreds of thousands of dollars from its board members and the brother of a top executive at annual interest rates as high as 7.5 percent. This month, Infinite secured a nearly $1 million federally backed loan whose 1 percent interest rate could allow the company to dramatically lower its funding costs. Company officials didn’t respond to requests for comment.

Intellinetics, the company that announced that it was buying a rival days after it received its emergency loan of $838,700, borrowed nearly $400,000 last fall from two brothers who run a small New York brokerage firm, Taglich Brothers. If the money isn’t repaid by May 15, Intellinetics will need to give the brothers stock in the company or start paying a steep 12 percent interest rate. (Some of that debt has already been converted into stock.)

“Securing the PPP funding gives us extra confidence and ability to restart and hit the ground running,” James F. DeSocio, the company’s chief executive, said in a news release.

Infinite Group and Intellinetics have not said precisely how they intend to use the loan proceeds.

A number of other companies have had serious accounting problems. The chief financial officer of CPI Aerostructures, an aerospace manufacturer that got a $4.8 million loanresigned in February after the company disclosed major problems with how it reported revenue.

And several firms have been paying their top executives millions of dollars despite financial problems that predate the coronavirus crisis.

For example, AutoWeb’s chief executive, Jared Rowe, got $4.7 million in total compensation over the past two years — including $1.7 million in 2019 — even as its stock price plummeted more than 70 percent. The company declined to comment.

And Manning & Napier, an investment firm in Fairport, N.Y., that has about $20 billion in assets under management, disclosed in March that its chief executive, Marc O. Mayer, earned nearly $5 million last year. On April 19, the company was approved for $6.7 million in the paycheck protection loans — even as the company said it would pay out a quarterly dividend to its shareholders.

Last week, amid mounting public anger toward large recipients of the rescue loans, Manning & Napier said it had decided not to take the money.

While the federal loan program is supposed to help companies avoid layoffs, some of the large recipients of loans have already dramatically reduced their workforces — and not always because of the coronavirus.

Harvard Bioscience, based in Holliston, Mass., has been trying since last year to pacify an activist investor that is pressuring management to boost the company’s stock price. The company closed facilities in North Carolina and Connecticut and said in February, before the coronavirus upended the economy, that it was laying off about 10 percent of its work force.

This month, Harvard Bioscience received a $6.1 million loan through the paycheck protection program. In a securities filing disclosing the loan, the company didn’t say why it sought the money or how it would use it. A spokesman didn’t respond to requests for comment.

A number of relatively large companies with connections to Mr. Trump also received millions of dollars in loans.

Phunware, a data-collection company that received a $2.9 million loan this month, counts Mr. Trump’s re-election campaign and Fox News as two of its biggest clients.

Continental Materials, a heating and air conditioning and construction material supplier based in Chicago, got a $5.5 million loan. The firm’s chief executive, James Gidwitz, is a major Trump donor, and his brother Ronald was appointed ambassador to Brussels by Mr. Trump after serving as Illinois campaign finance chairman for the 2016 Trump campaign.

It isn’t clear whether political considerations helped Phunware and Continental Materials get their loans approved. Neither company responded to requests for comment.