Opinion

Stories I’d like to see

Scoring healthcare insurers and getting campaign spending right

Steven Brill
Feb 21, 2012 13:53 UTC

1. When health insurers say no:

Like probably every other family in America, ours regularly has claims we submit to our health insurer rejected — with little or no explanation and no recourse from the company’s always-on-hold telephone hot line. Yet lately I’ve been seeing ads from health insurers projecting friendly, caring images. My favorite is the television and print campaign from United HealthCare featuring a girl who develops asthma but is shown swimming and even surfing because United, which sells insurance under the Oxford and other brands, has gotten her “specialists, lots of doctors, lots of advice…that help her pediatrician coordinate your child’s care and make sure all doctors are on the same page….” The ad trumpets United’s “more than 78,000 people looking out for 70 million Americans. That’s HEALTH IN NUMBERS,” the ad concludes.

Speaking of numbers, what percentage of customer claims for medical care or prescription drugs does United HealthCare reject? How does that compare with its competitors? Why can’t some reporters ask?

A cursory search on Google turns up little more than a 2009 Huffington Post piece reporting that: “Data on how often insurance claims are denied — and for what reasons — is collected and analyzed by the insurance companies themselves. But except in California, the companies aren’t required to provide those records to any state or federal agency.” The article quotes Karen Pollitz, a professor at Georgetown University’s Health Policy Institute, as saying: “The number is knowable, but not known by regulators or policy makers or patients.”

For starters, I’d like to see a story describing what must have been the ferocious lobbying to prevent the Obamacare legislation from requiring that this information be made public. Which members of Congress were pivotal in keeping this basic consumer information suppressed? Don’t they believe that free, competitive markets work best when consumers have this kind of data? It would seem that the Republicans who say they want to strengthen the private health insurance industry would be leaders in ensuring that this market information is available to their constituents.

Second, there should be more stories like this one from the Los Angeles Times in 2009, which reported the numbers that California requires be made public.

Romney’s ads, the Komen firestorm, and a Foxconn book

Steven Brill
Feb 14, 2012 12:53 UTC

1. Tracking Romney’s ad buys:

Look at the remaining Republican primary calendar dates and the candidates’ respective strengths and do the math: There are certain states where Rick Santorum and Newt Gingrich seem to have the best chance later this winter and spring (assuming one or both stay in the race) of winning enough delegates to deny Mitt Romney the majority he needs to lock up the nomination before the convention. These include Georgia (76 delegates, Super Tuesday – Mar. 6), Ohio (66 delegates, Super Tuesday) Tennessee (58 delegates, Super Tuesday), Alabama (50 delegates on Mar. 13), Texas (a huge 155 delegates on Apr. 3), Pennsylvania (72 delegates on Apr. 24), and California (an enormous 172 delegates on June 5).

Here’s an angle on these contests that could provide not only a heads-up on where the most dramatic showdowns might occur but also another dimension to the story of how outside money and negative ads have pretty much taken over the process: Some smart political reporting unit should be bird-dogging the ad sales people for local television stations in markets in those states, looking to find out if the Romney campaign and allied super PAC are buying enough ad time right now to carry out against Santorum or Gingrich the same kind of carpet bombing they did in Florida, where a reported $15.3 million ad buy buried Gingrich.

Following the scare produced by the loss in South Carolina, the Romney team proved in Florida that it could and would spend whatever it takes to snuff out the strongest not-Romney contender. To take one example of what it would mean for Romney to use that formula in upcoming contests, it costs more to blanket Texas with ads than it does Florida, and there is a longer run-up to that race than there was between South Carolina and Florida. That could translate into an ad spend of $40 million or $50 million across the Lone Star State.

A trove of stories from the Facebook IPO

Steven Brill
Feb 6, 2012 16:19 UTC

Facebook’s landmark IPO filing suggests lots of meaty stories. Among them:

1. Facebook, third parties and data security:

Embedded in the typically long recitation of “risk factors” designed to shield IPO issuers from shareholder suits should things go wrong is a section of the prospectus that warns:

Our efforts to protect the information that our users have chosen to share using Facebook may be unsuccessful due to the actions of third parties … If these third parties or Platform developers fail to adopt or adhere to adequate data security practices or fail to comply with our terms and policies, or in the event of a breach of their networks, our users’ data may be improperly accessed or disclosed. Any incidents involving unauthorized access to or improper use of the information of our users could damage our reputation and our brand and diminish our competitive position. In addition, the affected users or government authorities could initiate legal or regulatory action against us in connection with such incidents, which could cause us to incur significant expense and liability or result in orders or consent decrees forcing us to modify our business practices….

Not explained here is what protective mechanisms Facebook has to prevent these kinds of third-party security breaches and other abuses. Is the privacy and data protection of Facebook users only as strong as the weakest link among these third parties? Is there an Internet equivalent of the Gulf oil spill out there waiting to happen, after which Facebook points fingers at these third parties?

The Dodd-Frank effect, unions and private equity, and Newt’s expenses

Steven Brill
Jan 31, 2012 13:19 UTC

1. The Dodd-Frank effect: Good, bad or both?

Although the Consumer Financial Protection Bureau, the mega-agency created by the Dodd-Frank financial regulatory bill, has only been in existence for about six months, all of the Republican presidential candidates and GOP congressional leaders have slammed the agency and called for its abolition. Their central charge is that the regulations it has already promulgated are strangling the financial system and disabling banks from making the kinds of loans to small businesses and potential homeowners that would reignite the economy.

For example, in the Jan. 23 Republican presidential debate Mitt Romney said he had spoken to a banker in New York who said he had “hundreds of lawyers” tied up trying to navigate the new regulations.

Some sophisticated financial reporter, or team of reporters, needs to dig into that – with specifics. What exactly is the new agency requiring that is gumming up the works? What new rules are drawing the most persuasive complaints? How burdensome are they? How many lawyers and others are actually involved who were not working on the same types of regulations before? What abuses are the new rules intended to prevent? Which ones, if any, really do seem indefensible and which ones, if any, seem smartly crafted and worth the extra burden?

More primary math, Boeing’s second chance, and DHS mission creep

Steven Brill
Jan 24, 2012 13:50 UTC

1. Time to look at the late primary states and “favorite son” rules:

Two weeks ago, I suggested a story examining how the new rules requiring more proportional representation in awarding Republican primary and caucus delegates might force a deadlocked or brokered convention, because they could prevent even a front-runner like Mitt Romney from arriving in Tampa with the necessary majority of delegates even if he wins an overwhelming majority of the state contests. With it looking likely at least for now that Romney may not even be able to rely on winning most of the primaries and caucuses, the probability that a majority will elude all candidates seems higher.

So it’s time for stories about the rules and the candidates’ prospects in the large states with nominating contests that come after Florida and even after the much-heralded Super Tuesday on Mar. 6. For example, Texas, Maryland and Wisconsin come on Apr. 3 – and will award more than twice the delegates at stake in the four contests held through next week’s Florida primary. New York and Pennsylvania happen on Apr. 24; Indiana, North Carolina and West Virginia are on May 8; and California and New Jersey, among others, are on Jun. 5.

I’m looking for a story that explains, among other things, the rules regarding delegates pledged to one candidate being shifted to another. To take the obvious example, if Rick Santorum builds up even a modest number of delegates that could put someone else over the top, to what extent could he persuade them to move to Gingrich or Romney? (Suppose one of them hints at the vice-presidential spot for him.) If Santorum could deliver delegates to Gingrich, then the notion of him having to drop out to help Newt overcome Romney would be wrong; it would be better to have two anti-Romney flavors out there to choose from for a while.

Campaign questions, the world’s worst government agency, and medical lobbies

Steven Brill
Jan 17, 2012 14:28 UTC

1. Mitt’s tax bracket:

Note to television producers or editors about to do interviews with Mitt Romney on the campaign trail: The tax rate for the lower-middle class and middle class (joint filers earning roughly $17,000 to $70,000) is 15%. So any of your reporters doing an interview with Romney should ask him if he paid more than 15% of his total income in federal income taxes last year, or more than 25% — the bracket for income from $70,001 to $142,700.

Because of preferential treatment of capital gains, of “carried interest” income earned by people in the private equity business, and of money derived from offshore investments, as well as other tax breaks, there’s a good chance that Romney didn’t pay at a rate of 25% or even 15%. Be sure to use “total income” in the question, which would be Romney’s income before taking deductions for many of the tax breaks not available to average wage earners. Update: Shortly after this column was published, Romney was asked precisely this question, and told reporters that he paid “closer to the 15% rate than anything.”

Romney’s likely answer, based on what he has said so far, will be that he has not decided to release his tax returns but that he may do so later.

Romney’s delegate math, BP and Bhopal, and spotlighting CEO pay

Steven Brill
Jan 9, 2012 13:26 UTC

1. How does Mitt get over the top?

This year the rules for the Republican nominating convention have been changed to tilt more toward awarding delegates proportionately rather than giving all the state’s delegates to whoever wins its primary, no matter how slim the margin. To be sure, some reports have overstated the change; the rules have never been completely winner-take-all across the country, and this year’s changes don’t affect every state. But the changes could be important in a year when national polls continue to point to front-runner Mitt Romney’s difficulty in attracting more than about 25% support.

Indeed, with it seeming clear that even in states like New Hampshire, Romney can’t seem to attract majority support in a multi-candidate race, I keep looking for a story that will explain how Romney will capture the majority of delegates necessary to get the nomination. Could one irony be that–despite the conventional wisdom that what is saving Romney is that opposition to him is split in a multi-candidate race–it is, in fact, the presence of multiple candidates that most threatens Romney’s ability to wrap up the nomination, because it allows voters to choose their favorite non-Romney from multiple flavors?

It seems possible that Ron Paul will keep enjoying 10%-20% support, while the Santorum/Gingrich/Perry conservative faction could keep commanding 30%-40% support, especially if more than one of them stays in the race (and on the television debate stage) through the spring, assuming they don’t run out of money altogether or can live on shoe-string budgets when the money gets low.

Spotlight on Bain, Obama’s billion, and immigration madness

Steven Brill
Jan 3, 2012 13:20 UTC

1. Bain in the spotlight:

Private equity firms like to be, uh, private. With the exception of mega-firms like Blackstone, Carlyle and KKR, we rarely read about them, and even in those cases the ink is typically confined to the business pages. However, as it become increasingly likely that the founder of Bain Capital is going to be the Republican presidential nominee, a bright spotlight is likely to turn on Bain.

A smart story about Bain — which is one of the most successful, hardest driving firms in the industry — would start with the culture and business strategies Romney tried to instill as its founder. What kind of reputation did the firm have (and does it now have) for how it behaves at the deal table? Is its handshake good? Does it push too hard, or not hard enough? Are there certain types of businesses that it has avoided for strategic or civic reasons, such as tobacco companies? Did it and does it have any distinctive characteristics when it comes to minority hiring, treatment of women, and  charitable, civic or public service activities? (I’m thinking about that because of Romney’s own record, he says, of tithing 10% of his annual income.)

Does Bain have any especially aggressive policies with regard to tax avoidance or labor relations when it comes to the companies it controls? Are there any issues related to the sources of its funds, such as taking money from sovereign funds of rogue countries? Have any limited partner investors ever sued? If so, for what? (I doubt this is a sore spot, because from what I’ve heard its results have been good and its investors happy.)

Crash winners, the litigation world series, and Defense budget boondoggles

Steven Brill
Dec 27, 2011 16:06 UTC

1. Crash Winners

Here’s a new entry for the lists of winners and losers that get published this time of year: The ten lawyers, bankers, consultants or accountants who reaped the most from the financial disaster of the last three years.

The poster-boy would likely be Irving Picard, a partner at the Cleveland-based international law firm of Baker & Hostetler. Picard is the court-appointed trustee responsible for recovering money for Bernie Madoff’s victims. From the sketchy clips I’ve seen, it appears that Picard and his firm have already received more than $200 million in fees for their work from the court overseeing the cases. Is that true?

Then there are the lawyers involved in bringing and defending all those multi-hundred million-dollar and billion-dollar claims against the banks that packaged and re-sold troubled mortgages and other securities. Or the accountants, lawyers and bankers sorting out the assets and liabilities in the wake of the Lehman Brothers bankruptcy and and other implosions.

Oil spill muckraking, SEC excuses, and Gingrich’s taxes

Steven Brill
Dec 20, 2011 14:16 UTC

1. The Muck Around the BP-Halliburton Oil Spill Legal Fights

Earlier this month, BP filed papers in federal court alleging that Halliburton – which built the ill-fated Deepwater Horizon offshore well for BP – had destroyed test results showing it had used unstable cement to secure the well. The 310-page filing, filled with lurid accusations of negligence and cover-ups, is one of many such documents now sitting in publicly-available court records charging all kinds of misconduct by everyone involved in the oil spill disaster. For example, there’s also Halliburton’s suit against BP, filed in September, accusing BP of fraud and of hiding information that could have prevented the spill. A tour through all of this multi-million dollar lawyer name-calling is  bound to be fun reading, as would a highlights reel from the ton of documents produced in the dozens of suits filed by plaintiffs lawyers against both companies. It’s time that someone plow through all the mudslinging and tell us which charges, if any, seem real and what they tell us about letting either of these companies continue to operate in the Gulf or anywhere else.

2. Post-Crash Prosecutions: Excuses or Reality?

I tend to be skeptical of any government agency that cites funding shortages as an excuse for poor performance. So, as I keep reading all of those stories quoting the SEC saying that one reason the agency hasn’t been able to be tougher on those accused of violations related to the financial crash is because of budget constraints, my radar flares – especially since a quick check that any reporter could do before simply taking down those quotes reveals that the SEC’s $1.26 billion budget for the just-ended fiscal year is nearly three times its budget nine years ago. Can’t we see some reporting that details whether these supposed constraints on enforcement are real and, if so, why, given the flood of extra funding?

We also keep reading about the difficulty of proving criminal intent as the excuse for there not having been any prosecutions of major Wall Street bosses, which is the responsibility of the Justice Department, not the SEC. But I haven’t seen anything yet that actually explains why it’s harder to prosecute these securities fraud cases than others. Can’t someone zero in on those issues by talking to experienced prosecutors and defense lawyers and pinning down, with specifics, whether or why that’s true – or whether what’s more at work is some kind of failure of will, or nerve? How good a lawyer and leader is Lanny Breuer, the head of the Justice Department’s criminal division? And is it he or the local U.S. Attorneys who are making these decisions not to pull the trigger?

  •