An Obamacare “Horror Story” That Just Isn’t True: How Did This Happen? Part 2

For months, health reform’s opponents have been trumpeting tales of Obamacare’s innocent victims – Americans who lost their insurance because it doesn’t comply with the ACA’s regulations, and now have to shell out more than they can afford – or go without coverage.

Trouble is, many of those stories just aren’t true.

Below I posted about a Fort Worth Star Telegram article that leads with the tale of Whitney Johnson, a 26-year-old new mother who suffers from multiple sclerosis (MS). Her insurer just cancelled her policy, and according to Johnson, new insurance would cost her over $1,000 a month.

That claim stopped me in my tracks. Under the ACA, no 26-year-old could be charged $1,000 monthly – even if she has MS.

Obamacare prohibits insurers from charging more because a customer suffers from a pre-existing condition. This rule applies to all new policies, whether they are sold inside or outside the exchanges.

At that point, I knew that something was wrong.

When I checked the exchange – plugging in Johnson’s county and her age – I soon found a Blue Choice Gold PPO plan priced at $332 monthly (just $7 more than she had been paying for the plan that was cancelled). Co-pays to see a primary care doctor would run just $10 ($50 to visit a specialist) and she would not have to pay down the $1,500 deductible before the insurance kicked in.

My radar went up: Recently, I have been reading more and more reports regarding “fake Obamacare victims.”

Now I couldn’t help but wonder: Who are these folks in the Start-Telegram story? The paper profiled four people who supposedly had been hurt by Obamacare. When I Googled their names I soon discovered that three (including Johnson) wereTea Party members.

The paper describes them as among Obamacare’s “losers,” but the truth is that they didn’t want to be winners. Two hadn’t even attempted to check prices in the exchanges.

Meanwhile, it appeared no one at the Star-Telegram even attempted to run a background check on the sources, or fact-check their stories. I couldn’t help but wonder: “Why?”

The answer will surprise you.

Johnson finds affordable insurance …

When I tried to phone the reporter, she didn’t return multiple calls. Finally, I reached an editor at the paper. He told me that  both Yamil Berard, the reporter, and her editor were out of the office. I expressed my concern that inaccuracies in the story would discourage readers who were thinking about signing up in the exchanges. He suggested that I sounded like an “advocate” for Obamacare.

To my surprise, two hours later he called me back.

He had just received an internal email, he told me, which revealed that Whitney Johnson had found affordable insurance for $350 a month – just $25 more than the premium on her cancelled policy, and roughly what I thought she would pay in the exchange.

I asked the editor if he could send me a copy of the e-mail. “No,” he replied “It’s an internal memo.”

Would the paper publish a follow-up, acknowledging that Johnson would not have to pay $1,000 for coverage?

“I’m not sure what we’ll do with it.” He sounded cautious.

The Star-Telegram Doesn’t Tell Its Readers

To this day – more than a month after the story appeared – the Star-Telegram still hasn’t  published a follow-up, explaining that under Obamacare, no 20-something – including Johnson – will be charged $1,000 a month.

I then contacted Johnson, who confirmed that she had found a $350 Blue plan outside of the exchange. Based on the details she provided, I managed to locate it. (The premium is actually $347.92 a month.)

It turns out to be very similar to the exchange policy I had found. The premium is higher, but the deductible ($1,000 instead of $1,500) and co-pays for medications ($10/50/100 vs. $35/75/150) would be slightly lower. The provider network would be the same (Blue Choice).

The exchange plan offers a stronger safety net, and for someone with MS this could be important: If her husband’s income drops, or he loses health benefits at work, they would immediately be available for a subsidy. Because her new policy is not on the exchange, they would have to wait until open enrollment in November 2014 to sign up for a 2015 plan with subsidies.

I Talk to the Story’s Editor–and the Reporter 

Next, I spoke to Steve Kaskovich, the editor who assigned the story to Berard. He explained that he had asked the reporter to write a piece about people whose policies were cancelled, and as a result were “caught in the quagmire.”

I originally wrote this post for www.healthinsurance.org, an independent website (not connected to the insurance industry)where I, Wendell Potter, Hal Pollack, LInda Bertghold  and Louise Norris all blog.

To read the rest of this post click  here / and “Scroll down to Editor: Find People Caught In a Quagmire.” There you will discover what the editor had to say. When I finally talked to the  reporter, the truth came out. You can also hear me talking about the Star-Telegram piece –and problems with the way the media has been covering health care reform on NPR’s “Eye on the Media” . Click here: 

24 thoughts on “An Obamacare “Horror Story” That Just Isn’t True: How Did This Happen? Part 2

  1. I have a close relative who owns a large insurance sales business, specializing in health care insurance, primarily Medicare supplemental insurance. They, the husband and wife, have repeatedly told me about how terrible Obama Care is, and how it drives up the cost of health care insurance. As in this story, they note that the monthly cost is several times higher, the deductibles are higher, and less is covered. I assume they also tell their customers this same story. Nothing I can say will change their minds. What bothers me the most is that they honestly believe what they are saying.

    • Vaughn–

      Yes, your relatives are believing what they want to believe—and like most of Obamacare’s opponents will not listen to rational arguments.

      Here are the fact: Under Obamacare, deductibles vary. Some plans in the Exchanges carry a $0 deductible. All deductibles are capped at at maximum of $12, 700 for a family, $5, 400 for
      an individual. Pre-Obamacare, insurers were able to sell plans with $20,000 deductibles (or higher), knowing that people would avoid getting care because they couldn’t afford the
      deductible.

      Under Obamacare the monthly cost is “several times higher” than junk insurance that in many cases, didn’t include medications, didn’t include chemotherapy (too bad if you were diagnosed
      with cancer) and in some cases didn’t pay a penny if you landed in the hospital. This never should have been called insurance. The people who sold it should be ashamed of themselves.

      The tragedy is that they are no doubt, telling their customers the same story. And no doubt many customers believe them.

  2. Maggie:

    Mrs. Johnson may well have found an affordable way to pay her medical bills. It may actually be called, insurance, but it is not.

    Insurance is:
    “Contract that, by redistributing risk among a large number of people, reduces losses from accidents incurred by an individual. In return for a specified payment (premium), the insurer undertakes to pay the insured or his beneficiary a specified amount of money in the event that the insured suffers loss through the occurrence of an event covered by the insurance contract (policy). By pooling both the financial contributions and the risks of a large number of policyholders, the insurer is able to absorb losses much more easily than is the uninsured individual. Insurers may offer insurance to any individual able to pay, or they may contract with members of a group (e.g., employees of a firm) to offer special rates for group insurance. Marine insurance, covering ships and voyages, is the oldest form of insurance; it originated in ancient times with loans to shipowners that were repayable only on safe completion of a voyage, and it was formalized in medieval Europe. Fire insurance arose in the 17th century, and other forms of property insurance became common with the spread of industrialization in the 19th century. It is now possible to insure almost any kind of property, including homes, businesses, motor vehicles, and goods in transit”

    Having grown up in the insurance business, having been a licensed agent, having been an insurance consultant, having studied the concept and business of insurance and written specific policies for specific risks through Lloyds of London I think I know what I am talking about.

    Mrs. Johnson has known risks and costs that exceed the premium she will pay many many times over. What she is getting is subsidized medical care, not medical insurance.

    The entire Obamacare concept is to make sure everybody is covered for their medical needs and we will soak the producers and taxpayers to pay for it. That well may be a noble goal. It is not insurance! It is social engineering. It is income redistribution. It is welfare.

    How many more government welfare projects can this country afford before the “Social Contract” which is the “American Dream” dies an ignominious death?

    Regards,

    Charles

    • Charles,

      What you describe about insurance . . . how was that really different before Obamacare? A lot of people with serious illnesses got employer based coverage, and their care was paid for by the healthy.

      The system we had was not sustainable. Insurance companies pad the bills consumers pay, aren’t efficient, and do everything they can to bollux up reimbursement making health care more expensive. Something had to change, and conservatives had no answers on what to do . . . and still don’t.

      I don’t think Obamacare is welfare, because the vast majority of Americans will continue to get their insurance from their employers. But if you’re right and it is, so be it. The social benefits of keeping people healthy outweigh the cost of “wealth distribution.”

    • Charles–

      You are mistaken. Insurance redistributes risk among a large number of people.
      Some will wind up receiving benefits that far exceed what they put in; others (who are lucky enough to be healthy)
      will not.

      It’s that simple. The fact that we know that Johnson will receive benefits that exceed her payments (because she is already sick)
      does not change the concept of health insurance–which is very different from fire insurance, by the way.

      Every other developed country in the world insurers people who suffer from pre-existing conditions without charging them higher taxes (insofar health care in many countries
      is financed by taxes) The taxes they pay are based on their income, their wealth, or their spending (VAT) taxes.

      The notion that we should ask sick people to pay more–either in taxes or in insurance premiums– is both cruel and unfair.

      The poor are less healthy than the rest of us. You would penalize them for being poor–and thus further rip the social fabric of this country.

      The growing gap between the poor & middle class –those on the bottom 5 steps of a 10-step income ladder– and those on the top two steps, has grown in a ways that
      has undermined both our economy and our society.

      The good news is that now we are prepared to do something about this. Bill DeBlasio, the mayor of New York is leading the way– calling for rising taxes for those earning over $500,000
      to finance free pre-Kindergarten for all children in N.Y.’s public schools.

      Obama also is now prepared to address the income gap. With John Podesta as his adviser, he will be moving forward, using the power of the executive branch.

      Charles– fasten your seat-belt–the U.S. is beginning to move forward, joining the rest of the civilized world.

  3. A gentleman in my local area recently wrote an LTE to the local paper complaining how he was going to have to pay more under Obamacare. His LTE, like many “I’ll pay more under Obamacare” stories, is poked full of holes.

    For example, he claims that he gets health insurance from his former employer after retiring. His premium is about $63/mo (he is a widower, no dependants). Sounds reasonable.

    But now he claims his former employer contracted health care out to a third party company, and that through this company he will have to pay more for Medicare as well as his regular insurance, and pay separately for drugs. He claims a quadrupling of his yearly costs due to this.

    Of course, you pay Medicare directly not a third party, Medicare didn’t go up this year, and he could always get a plan on the exchanges and possibly even qualify for a subsidy. But he didn’t check. He didn’t look into Medicare Part C for supplemental health care, and he didn’t look into Part D for prescription drugs.

    In short, Obamacare should have little to do with his Medicare costs, and because he is over 65 he could get additional insurance for a reasonable price through Medicare’s other programs and not be affected by Obamacare at all.

    But hey, the point was to slam the law by “showing” how much more expensive it was going to make things for everyone, so to heck with the facts.

    • Panacea–

      His employer decided to change insurance for its retirees– as you say, this has nothing to do with Obamacare.

      But Obamacare could affect his Medicare costs if he has “Medicare Advantage
      (Medicare sold through a private sector insurer). His Advantage insurer could have decided to raise rates.
      because under Obamacare, Medicare is no longer over-paying these Advantage insurers to the same extent.
      (Under the legislation that Republicans pushed through Congress in 2003, Medicare began paying Advantage insurers
      13% more than Medicare itself would spend when insuring the same seniors.)
      I explain the changes made under the Affordable Care ACt here.https://healthbeatblog.com/2013/02/obamas-proposals-for-medicare-do-they-go-far-enough-will-they-become-law-part-1/

      • I think he has traditional Part B insurance. He quoted his premium as being $104/mo, which is what traditional Medicare is paying this year and paid last year, IIRC.

        • Panacea–

          If he has traditional Medicare, then you are right, Obamacare has not caused his premiums to go up.

  4. On Jan. 6, Star-Telegram Executive Editor posted a lengthy correction conceding you were right about the article.

    Major kudos to you for uncovering this, but he makes good points, including about other stories which show the ACA in a good light, including one just yesterday.

    Here is Witt’s mea culpa:
    http://www.star-telegram.com/2014/01/06/5464752/star-telegram-report-on-affordable.html?storylink=addthis

    Here is Saturday’s story about people benefitting from ACA:
    http://www.star-telegram.com/2014/01/10/5476240/with-help-tarrant-residents-get.html

    • Carlos,

      Yes–the story that ran yesterday is the story that the reporter wanted to do immediately after the “bad news” story–but
      the editor wouldn’t assign. (Ideally he would have assigned it before the December deadline to get insurance Jan 1. But better late than never.
      People still have until March 31 to enroll. )

      But the problem remains: overall, the media has run many more “bad news” stories than “success stories” about people whose policies were cancelled.

      Yet we know that 70% of those whose policies were cancelled would qualify for subsidies averaging about $5,600. The question is this:
      how many of them know that they are eligible, or how big the subsidies would be?

      We need the media’s help in getting that story out there.

  5. Good for you!! It’s not perfect and it needs improvements but the incessant lies told by opponents do nothing to improve health care in this country. Thank you.

    • Ann–

      I totally agree! And thank you.

      More people need to understand that this is just the beginning of reform.

      We will improve on it–just as we improved on Medicare and Social Security

      But the ACA is a very strong first step forward.

  6. Carlos–

    One fact that I forgot to mention about franchises: Why their PROFIT MARGIN may be thin, they make their money on Volume.

    Selling millions of hamburgers, etc. Multiply those millions by a tiny profit margin, and you are still talking about enormous profits (at least for the company.)

    Individual franchise owners may have a hard time making money if they are not located in a place where they can sell in volume.

    Fast-food businesses are premised on heavy traffic and volume. This means the franchisee must have the capital to rent a fairly large space, and hire many employees. If he doesn’t he will go under.

    It’s a tough business. But at the corporate level, Denny’s, etc. are making plenty of money. They can afford to give their employees health benefits.

  7. This is my first time sending to a blog.

    Thank you, thank you, thank you. You are exposing the lies, the deliberate distortions and the conspiratorial manipulation of people for unholy power-lust and greed motives.

    There is a sense of hopeless futility when confronted with an unceasing barrage of propaganda lies from (Is there any thinking person in the world who has difficulty in identifying that manipulative political party?) guilty of such destructive-to-America activity.

    I am a veteran and do not like the sacrifices of life and limb made by friends who fought for America, dishonored by the motivated-by-power-lust and greed manipulators.
    Shades of Dr. Joseph Goebbles, propaganda minister for Nazi Germany!

    Even a cursory study of history can reveal that much of the strength of a nation depends on the morality of its people“3. Obedience to His Commandments brings strength. Disobedience bring weakness and the eventual destruction of a civilization.
    “When a man becomes a criminal, he weakens the state.” The liars, utilizing lies as modus operandi, are traitors/criminals and should be judged for criminal activities inimical to America and, IF found guilty, the appropriate sentence carried out. Do they still use firing squads?

    The unfortunate aspect of all this propaganda is that many people unquestioningly accept it as truth and then give a good??? Nazi salute along with ‘Jawohl, mein fuehrer. Seig Heil!”

    That is enough of my sounding off. But, again, thank you for exposing the lies.

    • Jonathan–

      Thank you! I agree– this is all about the Nazi’s theory of how to persuade people:
      Tell a Big Lie, repeat it often enough, and people will begin to believe it.

  8. Your story regarding obamacare and the Fort Worth Star Telegram article doesn’t surprise me. I used to work for a newspaper and the number of times the journalists made up stories was unbelievable. No facts, No research, No care. They were more interested in sensational headlines to promote their own agenda.

    • Paul–

      I am afraid taht what you say is true at many papers.

      Journalists rarely write about this because they are told that they should not criticize other
      journalists (much the way policemen are reluctant to call out corruption on police forces and doctors are reluctant to testify against bad doctors.)

  9. Good catch. It’s unfortunate that we can no longer trust the media to provide accurate stories. I guess ethics is no longer taught in Communications classes….