Stories I’d like to see

Arms inspection stalling, runaway healthcare costs, and why Snowden revealed himself

Steven Brill
Sep 17, 2013 12:11 UTC

1.  Reality check on arms inspection stalling:

This New York Times article published last Sunday provides good detail on the challenges associated with implementing an arms inspection deal with Syria. However, someone this week ought to do a comprehensive recap of the years of stalling done by North Korea, Iraq and Iran to stave off and otherwise jerk around U.N. arms inspectors. President Obama may have found a convenient excuse for calling off the attack on Syria, but despite the promises of the rogue countries when they agreed to inspections, has any such mission ever gone according to schedule? And this one is supposed to proceed apace in the middle of a civil war.

2. Runaway healthcare costs, 50 cents at a time:

The test strips that diabetics use to measure blood sugar levels can be bought for about 50 cents each in boxes of 50 at the local Walgreens. That doesn’t seem like much, but it can add up when the world’s biggest healthcare customer is doing the buying.

Medicare spends over a billion dollars a year to provide the test strips to about 4.6 million beneficiaries, according to a recently released report from the Department of Health and Human Services Office of Inspector General.

Buried in the report are juicy leads for two important stories — one about fraud and the other about lobbying that allows both the fraud and higher costs even when there is no fraud.

First some facts:

    The report found what it called “questionable billing” amounting to $425 million of the $1.1 billion Medicare paid for the test strips in 2011, the year that was audited. That’s nearly 40 percent suspected overbilling.
    Of the $425 million, $329 million was generated by bills from suppliers in just ten of the 955 geographic areas into which Medicare divides the country.  Tops on the list were two Florida areas: Port St. Lucie, with $114 million in questionable billing, and Miami/Ft. Lauderdale/Pompano Beach with $113 million. (To put those numbers in context, that $114 million in potential overbilling for Medicare-funded test strips is more than 25 percent of the city of Port St. Lucie’s entire budget for that year.)
    The report noted that Medicare initiated a competitive bidding process in 2011 in a small number of regions covering about 3 percent of the country. In those regions, suppliers of what’s called durable medical equipment were forced to compete on price (after passing certain quality tests). According to the Inspector General, the regions that launched competitive bidding saw an 87 percent drop in questionable test strip billing, while the rate of questionable billing everywhere else stayed about the same (it dropped 3 percent).
    The report also noted that with competitive bidding the cost of a box of 50 test strips dropped to $14.62, compared to the $32.47 that Medicare pays where there is no competitive bidding. (Amazon sells a box of 50 for $27.85 — meaning that without competitive bidding Medicare, the world’s largest healthcare products customer, pays about 20 percent more than you or I would pay.)
    These price comparisons are consistent with another Inspector General’s report that found that in those limited areas where competitive bidding was implemented for all durable medical equipment (including test strips) the prices paid dropped 42 percent. Because Medicare spends about $15 billion for these goods, that would mean that if competitive bidding was the practice all over the country, Medicare’s cost for all of this equipment would drop $6 billion a year.
    Last fact: the geographic areas implementing competitive bidding were expanded last July — but neither Port St. Lucie nor Ft. Lauderdale/Miami/Pompano Beach were included, and those champions of questionable billing showed an increase in dubious test strip bills in 2011. However, in July Medicare initiated competitive bidding for mail-order suppliers of test strips across the country. That has dropped the average price to $10.41.

All of which is a road map for two promising stories.

The next terrorist attack, Obama’s Medicare cuts, and the gun lobby

Steven Brill
Jan 22, 2013 16:03 UTC

1. The next terrorist attack may turn your lights out for weeks:

Or it may cause a dozen planes to crash at once because the air traffic control system goes haywire. Or it could play havoc with our email, e-commerce, use of credit cards, and the stock markets. Or do all of the above.

Because I’m on the Department of Homeland Security’s press release list, I’m forever seeing announcements of one DHS official or another speaking at some conference on protecting our critical infrastructure. Last week, DHS’s “National Protection and Programs Directorate (NPPD) Office of Emergency Communications Region IV Coordinator” spoke at one in Tampa, and two other officials will be speaking at conferences on Jan. 23. The problem is that while there are endless forums about the threats, little is being done to deal with them.

Following the September 11 terrorist attacks, many news organizations went back and looked at the scant attention paid to a commission chaired by former Senators Gary Hart and Warren Rudman that delivered a report to the Bush Administration on Jan. 31, 2001, warning that if the country didn’t start shoring up its intelligence and defenses, “America will become increasingly vulnerable to hostile attack on our homeland, and our military superiority will not help us.” Last fall, a series of measures to protect our critical infrastructure – everything from the power grid to electronic systems enabling air traffic control – failed to make it out of Congress despite warnings from Homeland Security and Pentagon officials that, as with the Hart-Rudman prediction, a devastating cyber-attack on our infrastructure was now a matter of when, not if.

Medicare meddling, the guns of Westchester, and Al Gore’s payday

Steven Brill
Jan 8, 2013 13:09 UTC

1)   Fiscal cliff Medicare meddling:

According to this report in the New York Times, last-minute negotiations on the fiscal cliff included new congressionally imposed limits on what Medicare will pay for “nonemergency ambulance transportation of kidney dialysis patients” and “would reduce Medicare payments … for stereotactic radiosurgery, complete course of treatment of cranial lesion(s) consisting of one session that is multi-source Cobalt-60 based.’”

Yes, Congress really does get that far down in the weeds when it comes to dictating how Medicare doles out more than $500 billion a year. This includes, for example, overseeing the payments Medicare allows, by state, for designated categories of ambulance rides (“critical,” “emergency,” “air evacuation,” etc.).

There are two obvious stories here: What scandalous overpayments or abuses in those nonemergency kidney dialysis ambulance trips triggered this intervention, and who in Congress pushed for it? Similarly, what’s the story behind those Cobalt-60 treatments?

Romney, Sully, Steve Jobs and The Boss

Steven Brill
Nov 22, 2011 10:00 UTC

By Steven Brill

This is the first entry in a new regular column, “Stories I’d Like To See.” It’s the notebook of someone who still thinks like an editor but is over the thrill of managing a reporting staff – or the hassle of dealing with “great” story ideas that crash and burn when someone actually goes out and reports them and learns anew that even the best editors can’t hit much better than the best ballplayers (meaning three or four out of ten story ideas will actually work).

1. Mitt the philanthropist:

If the excellent New York Times story last month about Mitt Romney’s Mormon Church involvement is correct, he is required to tithe 10 percent of his income to the Church or church activities each year. This would amount to an enormous amount of money when he was running Bain Capital during its highly-successful years. It might even make him the most charitable person ever to run for President (or be President). Is this true? Or did he tithe 10 percent of his “taxable income,” which would have been a lot less, given all the deductions and favorable tax-rate-treatment available to a high-income private-equity earner?

2. Mitt the taxpayer:

On the other hand, this raises the issue of what percentage of his gross earnings Romney paid in taxes during his best years, or even last year, when presumably all of his earnings were capital gains and might also have been subject to all kinds of investment tax credit and other deductions. I know he hasn’t released his tax returns (yet), but can’t someone get access to Bain’s investor reports and an estimate of his gross income, and then extrapolate that into what he actually might have paid, given favorable tax treatment of capital gains and of carried interest payouts to private equity fund managers? Or, at least, can’t some pesky reporter simply pick Bain’s best two or three years when he was running it and ask Romney what percent of federal income tax he paid on his gross income?