“Just because your voice reaches halfway around the world doesn’t mean you are wiser than when it reached only to the end of the bar.”
– Edward R. Murrow
Long before the advent of the Internet, Edward R. Murrow, the newsman who stood up and exposed the lies spread by Senator Joe McCarthy in the early 1950s, understood that while “the speed of communication is wondrous to behold, it is also true that speed can multiply the distribution of information that we know to be untrue.”
Murrow was right. Today, as traffic on the information highway has picked up speed, it often seems that, the Information Age that we celebrated in the 1990s has become an Age of Misinformation .
Today, not only CBS, the network that brought us Murrow, but the media as a whole seems to have forgotten his plea to his fellow journalists: “Just once in a while, let us exalt the importance of ideas and information.”
The Media and Obamacare
When it comes to covering the Affordable Care Act (ACA), not only television networks but our major newspapers have fallen far short of Murrow’s fearless standards. Instead of ideas and information, the mainstream media serves up opinions and anecdotes.
Tall tales about “Obamacare’s victims” have become standard fare. In recent months I have deconstructed two faux fables: one that appeared in the Ft. Worth -Star Telegram, another that aired on CBS stations nationwide.
Let me add, I am just one of many skeptics who have taken a close look at some of the “ginned-up stories” that, as the Los Angeles’ Times Michael Hiltzik puts it, “have led millions to think that a program manifestly in their best interests is something bad.”
Hiltzik detects a pattern: “What a lot of these stories have in common are, first of all, a subject largely unaware of his or her options under the ACA or unwilling to determine them; and, second, shockingly uninformed and incurious news reporters, including some big names in the business, who don’t bother to look into the facts of the cases they’re offering for public consumption.”
In some cases, it is clear that writers, editors, pundits and producers are purposefully slanting the news. Fox News comes to mind. But in many other cases, the problem seems to be sheer ignorance, combined with a striking lack of interest in the most important piece of legislation to have passed congress in roughly 45 years.
There are, of course, notable exceptions. In addition to those named above, Jon Cohn, Ezra Klein, Sarah Kliff, and Reed Abelson stand out, along with numerous health care bloggers listed on HealthBeat’s blog-roll.
But the vast majority of the television and newspapers reporters who are translating the Affordable Care Act for the public have never studied even a small section of the law. Nor have they read the fact-filled issue briefs produced by groups like the Kaiser Family Foundation.
Instead, like journalists who cover a war by swapping stories with other reporters at the hotel bar, they read what other scribes write, and assume (like the general public) that if it was printed in a mainstream publication, it must be true. Journalists, of all people, should know better. They are aware of how the sausage is made–at a high speed, under pressure, and without fact-checkers.
The Wall Street Journal Disappoints
When I became a journalist in the 1980s, many viewed the Wall Street Journal as the best-edited newspaper in the nation. That did not mean that you agreed with or trusted its editorials. But when it came to news stories, the Journal’s were tight, clear and true. You could depend on their accuracy.
The WSJ was what some veteran journalists called “a red check.”(In bygone days when Time, Newsweek, Fortune, Forbes and other respected magazines had fact-checkers, they used red pencils, and drew a “check-mark” through each phrase or number as they verified its accuracy.)
So it was with dismay that I read a December 9 WSJ article headlined “High Deductibles Fuel New Worries of Health-Law Sticker Shock.”
The piece opens with alarming news: “As enrollment picks up on the HealthCare.gov website, many people with modest incomes are encountering a troubling element of the federal health law: deductibles so steep they may not be able to afford the portion of medical expenses that insurance doesn’t cover.
“The average individual deductible for what is called a bronze plan on the exchange—the lowest-priced coverage—is $5,081 a year, according to a new report on insurance offerings in 34 of the 36 states that rely on the federally run online marketplace.
“That is 42% higher than the average deductible of $3,589 for an individually purchased plan in 2013 before much of the federal law took effect, according to HealthPocket Inc., a company that compares health-insurance plans for consumers. A deductible is the annual amount people must spend on health care before their insurer starts making payments.” The next day, “CBS This Morning” would repeat “42% higher”, citing the Wall Street Journal.
This is a story that cried out for a fact-checker. To say it was misleading would be an understatement.
Let me be clear: I don’t think that either the reporters who wrote the story or the editors who approved it were intentionally distorting the facts about Obamacare.
The truth, I’m afraid is far more depressing: a great many reporters and editors at our most esteemed media outlets know very little about the policies available in the Exchanges. They have never shopped the state marketplaces and examined the details of the plans. Why would they? These journalists have health benefits at work. This may help explain their lack of interest in, and passion for, reform.
What Is a Deductible?
Let’s begin with the last sentence of the lead: “A deductible is the annual amount people must spend on health care before their insurer starts making payments.” To call this a “half-truth” would be generous.
Some policies require that you pay down the deductible before the insurance kicks in. Pre-Obamacare this was true of most policies peddled in the individual market where people purchased their own insurance.
But in the new Exchanges a great many plans will begin reimbursing for medical expenses before you have met the deductible. For example, if you visit a doctor your carrier may ask only for a co-pay of $25 or $30.
There is no nationwide data showing how many policies begin paying for doctors’ visits before the patient pays down the annual deductible. But an eHealthinsurance.com survey of seven major cities commissioned by Kaiser Health News shows that fully 50% of the lowest-cost bronze plans, along with 75% of mid-tier silver plans, kick in with your first visit to a physician.
(Tip: How to find out. If you are shopping for insurance on Healthcare.gov, when you find a policythat you like, click on “details” for information on what services will be covered “before” or “after” you have met the deductible.)
What about Silver, Gold and Platinum Plans ?
The Journal story exaggerates how much Exchange customers are expected to pay out-of-pocket by focusing almost exclusively on bronze plans, the Exchange policies with the lowest premiums, and the highest levels of cost sharing.
Let’s go back to the assertion that, in the Exchanges, bronze plan deductibles are “42% higher” than average deductibles in the individual market before the Affordable Care Act was passed.
Take a close look at the wording:
“The average individual deductible for what is called a bronze plan on the exchange—the lowest-priced coverage—is $5,081 a year. . .
“That is 42% higher than the average deductible of $3,589 for an individually purchased plan in 2013 before much of the federal law took effect, according to HealthPocket Inc., a company that compares health-insurance plans for consumers.”
What the reporters slide over is the fact that HealthPocket compares only Bronze plans to the “average deductible” for all plans in the individual market pre-Obamacare . This is not an apples-to-apples comparison.
Ideally, before the WSJ published this story, a sharp editor would have looked at the skewed comparison and said: “Wait a minute. Why are we comparing only bronze deductibles to deductibles in the entire universe of individual plans pre-Obamcare?.
“I know there are three other tiers of coverage in the Exchanges that call for less out-of-pocket spending. How do silver, gold and platinum deductibles stack up to deductibles in the individual market before Obamacare?”
If someone had asked Coleman, he could have told them. By December, he had taken a closer look at cost-sharing on all tiers of the Exchanges and knew that:
- the typical silver policy asks that customers meet a deductible of just $2,905—about 40% less than the average bronze deductible;
- when packaging gold and platinum plans, many carriers offer “zero-deductible” policies.
This tells you how unlikely it is that, if you included all four tiers of coverage, the average deductible in the Exchanges would be anywhere close to the average bronze deductible of $5,081. The bronze plan is an outlier.
But apparently, no one at the Journal inquired about cost-sharing on the other tiers —not the two journalists who co-wrote the piece, not the editor, not the copy-editor. Perhaps none of them knew that silver, gold and platinum plans call for far lower deductibles.
One might wonder why Coleman himself–he has studied the ACA– ignored silver, gold and platinum plans when he investigated Exchange deductibles in June 2013. In the fall of 2013, he explained to Bloomberg News that when he did the survey five months earlier, comparing bronze plans to all plans in the private market seemed “a fair comparison because bronze plans, as the cheapest, are likely to be the most popular with consumers.”
Before the Exchanges opened, Coleman, like many observers, assumed that shopper would simply look at premiums and pick the cheapest plans. They were wrong.
Consumers proved wiser than the pundits expected. They looked at deductibles, co-pays, subsidies and benefits – not just premiums. (This could be because the Exchanges human “navigators” proved more helpful than observers predicted.)
Little-Known “Zero-Deductible” Policies
One reason so many under-insured and uninsured consumers are choosing platinum, gold or silver is that in these tiers some carriers offer “zero-deductible plans.”
That’s right—the patient may have a co-pay when seeing a doctor, filling a prescription, or going for an MRI, but his insurer covers the rest. There is no deductible to “pay down,” even if he is hospitalized.
A recent HealthPocket survey of Exchange coverage in 34 states reveals that
The WSJ, like most in the mainstream media, rarely mention these policies.
A Newer Study Compares Deductibles for All Exchange Plans
Ironically, just four days after the WSJ published its December story, HealthPocket, came out with an excellent, updated report showing average deductibles for all four tiers of Exchange insurance.
This survey discloses that:
- the typical gold plan comes with a deductible of just $1,276
- platinum deductibles average $347–”90% less than the deductible average for the 2013 pre-reform market.”
- if you buy silver you are likely to face a $2,905 deductible—far less than the $5,081 bronze deductible the Journal cites.
Unfortunately, while the June 2013 survey, which talks about bronze plans costing “42%” more ” was picked up by Bloomberg and other major outlets, HealthPocket’s newer,more accurate report drew relatively little attention– perhaps because it did not appeal to the media’s appetite for bad news about Obamacare.
But Can Most People Afford Silver, Gold or Platinum Premiums?
In 36 states, a 27-year-old will find that the a typical bronze plan costs $163 a month, while silver coverage is available for $203—before tax credits. After applying the credits, the vast majority of 20-somethings will be able to buy bronze for less than $100 a moth.
Keep in mind that so far, 82 percent of those who have signed up the Exchanges are receiving premium tax credits, making silver and gold plans far more affordable for millions
In those same 36 states, the average 40-year-old will pay $262.29 for bronze coverage, $284.02 for silver. At age 50, premiums rise to $295.51 and $319.42– before applying premium tax credits.(Under the ACA, insurers can charge older Americans up to three times as much as they would charge a 20-something for the same policy. Pre-Obamacare they could demand that a 60-year-old pay five times at much.)
But at 50, a customer might well prefer a gold or platinum plan. Yes, the average monthly premium is higher: if a 50-year-old earns too much to qualify for tax credits he will have to lay out $377.63, monthly for gold, $388.29 for platinum. Note that the typical platinum premium is just a hair higher than gold, and if a customer chooses platinum the odds are excellent that he will be able to find “zero-deductible” coverage.
Meanwhile, doctors’ visits will be cheaper: on average platinum plans asks for a co-pay of just $16 when you visit a primary care physician, $30 when you see a specialist. If a patient visits a doctor eight or nine times a year, the savings add up.
Caps on Total Financial Exposure
In 2013 nearly 2 million Americans filed for bankruptcy because they could not pay their medical bills. Three-quarters of them actually had health insurance, but it was too skimpy to provide the protection they needed. Most plans capped the amount that the patient could be asked to pay out of pocket, but up until now, most insurers could set the limit wherever they pleased.
Under the Affordable Care Act, no Exchange plan can ask an individual to ante up more than $6, 627 in co-pays and deductible. By contrast, pre-Obamacare 36% percent of policies called for higher levels of cost-sharing–sometimes much higher. In addition, the patient had to pay for any services that were not covered by a bare-bones policy. For example, last year the most popular plan sold in New Jersey’s individual market provided no coverage for chemotherapy, prenatal care or ambulance services. (The plan has now been cancelled.) The ACA insists that insurers who peddle policies in the state marketplaces must reimburse for all essential benefits. No insurer can say: “Sorry, the chemo’s on you.”
The WSJ reporters acknowledge that if you buy a bronze policy in the Exchange, your total cost-sharing is limited to $6,627. But they exaggerate a patient’s financial exposure under Obamacare by once again, focusing only on bronze. They fail to mention that, even if you are in a catastrophic accident, the carrier who sold you a platinum policy cannot ask you to chip in more than $1,855 toward your total medical bills in a given year—that includes drugs, tests and routine doctors’ visits as well as a hospital stay and surgery. The average gold plan limits out-of-pocket expenses to $4,081, and silver policies set the cap at $5,730. Keep in mind that 81% percent of customers in the state marketplaces are choosing one of these three plans. Bronze plans are outliers.
Granted, the average American does not have $5,730 lying around in a checking account. But the difference between owing $5,730 and facing bills of $40,000 or $50,000 is the difference between being able to negotiate with a hospital, arranging to pay over time, and staring at a debt that both the hospital and you know that you won’t be able to pay—not now, not anytime in the near future. That is when they begin looking at your assets.
Finally, the caps quoted above are national averages. In some areas, where doctors and hospitals charge less, or are willing to negotiate with insurers, shoppers can find platinum coverage that limits total co-pays and deductibles to $1,000; gold plans are available that draw the line at $1,500. Some silver plans will ask the patient to pay no more than $3,000 out-of-pocket; the most generous bronze plans limit total cost-sharing to $4,350.
In January HealthPocket published a report that emphasizes the range of cost-sharing even within tiers, and explains just how low the caps can be. When Coleman e-mailed this survey to me, he wrote “I thought it was an interesting study but it got little press coverage. It was probably a bit too wonky for mass consumption.”
Maybe it was too wonky for the general public, but we need more journalists willing to mine detailed studies like this one. Only then can they give their readers a nuanced picture of what Obamacare offers.
Cost-Sharing Subsidies for the Lower Middle-Class
Do you remember how the WSJ article begins? “As enrollment picks up on the HealthCare.gov website, many people with modest incomes are encountering a troubling element of the federal health law: deductibles so steep they may not be able to afford the portion of medical expenses that insurance doesn’t cover.”
A few paragraphs later the reporters note that “cost-sharing” subsidies to help pay deductibles are available to people who buy a silver plan and “earn up to 2.5 times the poverty level, or about $28,725 for an individual . . ..”
These are the people of “modest means” that the story claims to be worried about. If they are the focus of concern, one would think that these subsidies would merit more than one sentence. But the article quickly moves on, to declaret that “those limits will leave hundreds of thousands or more people with a difficult trade-off. They can pay significantly higher premiums for the exchange’s silver, gold and platinum policies, which have lower deductibles, or gamble they won’t need much health care and choose a cheaper bronze plan.”
Just how many Exchanges customers won’t qualify for cost-sharing subsidies, but still won’t be able to afford out-of-pocket costs on the Exchanges? I find “hundreds of thousands or more” to be a extremely fuzzy number. I can imagine the reporters—or perhaps the reporters and editor—debating (“should we say ‘hundreds of thousands’ or millions?”), and finally compromising on this nearly meaningless phrase. No one in the room had done the research needed to come up with a reasonable estimate.
Moreover, the description of the “trade-offs” is misleading. In order to be eligible for cost-sharing subsidies an Exchange shopper must purchase a silver plan, but as noted, on average, silver plan premiums are only 8% higher than bronze–this is not “significantly higher.” And, deductibles are 40% lower. Laying out 8% more for a plan that cuts your cost-sharing by two-fifths, is not a “difficult trade-off.” This is why as of February 1, sixty-two percent of Exchange shoppers had picked silver while only 19% chose bronze.
Bronze can be a good choice for a single, healthy 20-something who rarely needs to see a doctor. But for families with multiple health care needs, silver may be the best option—particularly if they are eligible for those “cost-sharing subsidies” that the Journal mentions, if only in passing.
What the article does not t spell out is that it is not just “an individual earning $28,725” who can get government help that slashes co-pays and deductibles. A middle-class family of four with income of $59,600 also qualifies. (Note that cost-sharing subsidies are separate from the tax credits that help cover premiums. A family earning $59,600 or less will be eligible for both.)
Mainstream journalists often describe cost-sharing subsidies as a program designed to help “low-income people.” But as a Hamilton Project study reveals, more than half of America’s working-age families with children under age eighteen (approximately 20.1 million families) have incomes of $60,000–or less. This includes wages, salary, alimony and investment income, if any. They are not “low-income” or even “working poor.” As the Project recognizes, they are members of the “struggling lower-middle class.”
Few reporters, editors or producers at major media outlets like the Washington Post or ABC are trying to raise two children on $59,600. This may be another reason why they know little about the details of these “secret subsidies” that, as Nathan Newman points out, “the media rarely talks about.“
Granted, if reporters were going to explain these subsidies to the public they would have to wade into some wonky details. The exact way they work varies from state-to-state and, in some cases, plan to plan.
But here are some examples that, if reported, would help a lower-middle-class family realize: “Hey, maybe we could find affordable coverage in the Exchange!”
- In California’s health care exchange, a family of four that grosses $33,000 won’t have to meet a deductible for medical care or brand-name prescription drugs. Visiting a specialist, or going for a diagnostic testing or X-rays, will cost just $5. This is insurance that they can afford to use. .
- In New York, a single 20-something who earns $22,000 will find that if he is enrolled in a silver plan, his annual deductible will be just $250 (down from $2,000 if he earned more than $28,725.) When he visits a doctor, he will be expected to ante up $15 per visit; if he is hospitalized the co-pay will be $250. Over the course of the year, his insurer cannot ask him to lay out more than $2,250 in total co-pays and deductible.
These are the facts that the public needs to hear—not the questionable man-in-the street anecdotes, not the opinions of prejudiced politicians and pundits.
In part 2 of this post I will go further in exploring why it is reporters seem to know so little about the Affordable Care Act, and what “knowledge-based journalism” would mean. I also will tell you what happened when I e-mailed the Wall Street Journal.