Stories I’d like to see

1.     Looking at ‘Ratchet, Ratchet and Bingo’:

In his 2006 annual report to shareholders , Warren Buffett had this to say about compensation consultants:

Too often, executive compensation in the U.S. is ridiculously out of line with performance. That won’t change, moreover, because the deck is stacked against investors when it comes to the CEO’s pay. The upshot is that a mediocre-or-worse CEO – aided by his handpicked VP of human relations and a consultant from the ever-accommodating firm of Ratchet, Ratchet and Bingo – all too often receives gobs of money from an ill-designed compensation arrangement.

Buffett went on to explain how these consultants simply make outsized pay in any industry the norm by ratcheting up the average, so that all executives in a given “peer group” have to get what everyone else gets:

Additionally, the committee is told about new perks that other managers are receiving. In this manner, outlandish “goodies” are showered upon CEOs simply because of a corporate version of the argument we all used when children: “But, Mom, all the other kids have one.” When comp committees follow this “logic,” yesterday’s most egregious excess becomes today’s baseline.

During his talk a year ago at the Berkshire Hathaway annual shareholders meeting, when Buffett called these compensation consultants prostitutes, his vice chairman Charles Munger objected.  “Prostitution would be a step up for them,” Munger said.

1.  Obama administration malingers on hospital bill collecting abuses:

Here’s a compelling story for any reporter who wants to shine light on a failure of basic competence – or maybe it’s backbone – by the Obama administration on an issue that affects millions of middle class and poor Americans and that was supposed to be the president’s number one priority.

In the article about healthcare prices that I wrote last month for TIME, I reported that supposedly non-profit hospitals not only charge ridiculously inflated prices (from a price list called the chargemaster) to people who are uninsured or underinsured, but they also routinely sue and demand that those full prices be paid. It’s a prime reason medical bills are the cause of more than 60% of personal bankruptcies and even more demolished credit ratings across the country.

However, one of the little-noticed provisions of Obamacare, which was passed three years ago this week, requires that non-profit hospitals, as a condition of keeping their tax exempt status, must adhere to rules to be promulgated by the IRS that would, among other things, not allow them to send bill collectors or lawyers after patients except under certain conditions. Those conditions include that the patients first be informed through aggressive outreach efforts of the availability of financial aid for patients unable to afford the bills and, more important, that for patients whose incomes are below certain levels, hospitals can only dun them or sue them for the discounted amounts they usually charge insurance companies, rather than the far higher chargemaster prices.

For the past 10 days I’ve been interviewed on various television and radio shows about the article I wrote for the March 4 issue of Time, called “A Bitter Pill.”  It’s all about how exorbitant prices and profits are at the core of the crisis America uniquely faces when it comes to financing healthcare, the cost of which now accounts for roughly a fifth of our gross domestic product. The article took a new approach to reporting on an overreported issue by avoiding “on the one hand, on the other hand” policy analysis. Instead, I took actual medical bills and dissected them line by line.

Invariably a question has come up in these interviews about how I thought of that approach. So, since this is supposed to be a column about good story ideas, I think I’ll use it to explain the genesis of “A Bitter Pill” in more detail than I’ve been able to on the talk show circuit.

I always tell the students in a journalism seminar I teach at Yale that the best stories come from what you’re most curious about. Because I’m interested in business (as well as legal and political issues), questions about business and money often are what make me most curious, sometimes to the point of idiosyncrasy. For example, when I read last week that Jeff Zeleny, a star political reporter for the New York Times, had been hired away by ABC News, one of my first thoughts was that I’d like to see a story detailing how much more money he’ll be making – I bet it’s as much as twice his Times salary – and perhaps analyzing whether for Zeleny and other journalists his move represented a wrenching market misallocation of talent, given that his work is likely to have more impact, not to mention space, in the Times than on network television.

1. Find the story here:

Let’s begin this column with a quiz, one designed to test your story-generating talents. If the answer comes to you within 10 seconds, you, too, could be an editor or TV news producer. If you are an editor or producer and don’t see it instantly, you need better radar.

First, read the opening two sentences from a story that appeared in the Financial Times a few weeks ago:

Europe’s  most senior justice official is adamant she will fight US attempts to water down a proposed EU data protection and privacy law that would force global technology companies to obey European standards across the world. Viviane Reding, EU commissioner for justice, said that the EU was determined to respond decisively to any attempts by US lobbyists – many working for large tech groups such as Google and Facebook – to curb the EU data protection law.

Just because President Obama and his team have been pathetic when it comes to letting Americans know what’s in his healthcare reform law doesn’t mean the press shouldn’t be zeroing in on this huge, multifaceted story. The law is packed with changes – some of which have already taken effect but have barely been written about – whose ramifications range from likely upheavals in the advertising and marketing industries to an apparent lifeline for all Americans who are mystified or even tormented when dealing with their health insurers.

A marketing explosion

Let’s start with the business angles. As this article from Advertising Age points out, once various provisions of Obamacare take effect, key sectors of the healthcare industry, particularly hospitals and insurance companies, are going to have to become heavily engaged in consumer marketing and communications. In the last few years we’ve seen some hospitals use advertising to establish their brand, and, as I mentioned in this column in February, United HealthCare has been aggressively advertising to consumers.

All of these early efforts are about to be taken to a whole new level because of Obamacare – which requires that by 2014 everyone must buy health insurance and every state must have an exchange where consumers can go online and compare insurers’ offerings. This means not only that the market for health insurance is going to expand but also that much of it is likely to be sold directly to individual consumers rather than through an employer. Meantime, hospitals and doctors’ networks will want to advertise to have more leverage in negotiating with insurers to include them in the insurers’ networks.

1. Looking in on the old money:

This and other articles last week reporting that the Rothschilds and the Rockefellers are joining together to expand their wealth advisory and asset management enterprises reminds me of a story I’ve wanted to see for a long time: In an age when we’re entranced by the wealth of twentysomething dot-commers, someone should look at some of the old-name American fortunes and see how much wealth remains today for the dozens, or hundreds, of their descendants.

We know from this story and others that the Rockefellers still maintain an office that manages the family’s wealth (and, in fact, has expanded to manage other families’ fortunes). But how are they doing? What’s a teenage or twentysomething Rockefeller worth today? What about the Morgans, the Goulds, the Vanderbilts, the Astors, the Flaglers? Or the Kennedys? Who’s still doing well? Who’s down and out, and why?

2. Why no bunts?

Unless you’re a baseball fan, or maybe unless you’re a Yankee fan, you may not care about this, though you should, because it could be a story about ego overwhelming pragmatism. With baseball teams overshifting their defenses this year more than ever to snag hard grounders and line drives from lefty pull hitters, why aren’t any of the power lefties simply bunting down the third-base line for an almost sure single or maybe even a double? After all, the best hitters only succeed 3 times out of 10, while this is probably a 9-out-of-10 proposition.

1. Disclosure on cable news shows:

When talking heads come on the cable-TV news shows to support their causes and attack the opposition, are there any standards imposed by their host networks for disclosing conflicts of interest?

Here’s an excerpt from a statement put out by the conservative Koch Industries the week before last complaining about MSNBC:

On March 23, while guest hosting the Martin Bashir program, Karen Finney accused Koch of a connection with the tragic circumstances surrounding the Trayvon Martin matter. ”Who was the Typhoid Mary for this horrible outbreak,” Finney asked. She then stated, ”It’s the usual suspects the Koch brothers … the same people who stymied gun regulation at every point who funded and ghost write these laws.” Because we saw this dishonest story line developing and were concerned other extremists would pick it up, we put out a public statement the day before Ms. Finney’s rant explaining that this story line was totally false and irresponsible. First, Koch has had no involvement in this legislation … You should also be aware that on March 26, Ms. Finney signed and sent a letter on behalf of the Democratic Senatorial Campaign Committee soliciting political contributions. Yet, she is presented to viewers as a “political analyst” and not as a paid fundraising operative for the Democratic party, as would be accurate.

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.”

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.