The story idea seemed reasonable—a follow-up to the news that Anthem Blue Cross planned to raise rates on individual policies in California by as much as 35 percent. The first Anthem story last week was one of those Oh My God news events that got everyone, even the White House, gasping with outrage. So Tuesday The New York Times weighed in with a piece called “In California, Exhibit A In Debate on Insurance.” Perhaps it was meant to be an explainer about those rate increases from gigantic insurance companies. But, alas, the story confused more than it explained. Was it just bad editing? Or was it that the paper just couldn’t decide what story it wanted to tell?
The lead was predictable enough. We learn that one Bernhard Punzet, a thirty-four-year-old in Los Angeles just got a 34 percent rate increase, raising his monthly premium to $254. That seemed low by New York standards, so I read on, trying to find out what kind of policy Punzet had purchased. Was it one of those cheapie, limited coverage Tonik policies that Anthem likes to sell to young adults? That would explain the low premium. The Times didn’t say, though, instead offering a quote from Punzet. “Ten percent I could have rationalized…I’ve never seen anything go up to 34 percent.”
Next came some graphs about the rate increases and the “seething fury felt by Mr. Punzet and nearly 700,000 other Anthem customers in California who have received notices of increases that average 25 percent.” Then the paper said that l’affaire Anthem “reinforced an emerging shift of focus in Washington from the need for universal coverage to the need for serious cost control,” and reported what it called “a deep rift” between the administration and the insurers about whether such “unsustainable pricing is driven by the “bloodless economics of risk or a corporate culture of greed.” Vivid language from the Grey Lady—but was the story going to discuss cost control and tell readers that doctors and hospitals are also responsible for rate increases, a point overlooked by the media and most everyone else?
Nope. Aside from quoting from an Anthem statement about having to manage the rising costs of hospitals, doctors, and drugs, the paper didn’t mention the role that doctors and hospitals play in the pricing mess. It did talk about HHS Secretary Kathleen Sebelius’s public whipping of Anthem. Sebelius had said she was “very disturbed” to learn that rates were rising, in view of the carrier’s fourth quarter earnings of $2.7 billion. But, as the Times noted, Sebelius didn’t say that the surge in earnings came from the one-time sale of a business unit. Now that was important, and should have been in every news story written last week. You know—that fairness and context thing. I wish the Times had explained this more.
A few graphs later came a quote from an anonymous study released this week, showing that “the five largest health insurance companies collectively lost 2.7 million customers last year, including 1.4 million by WellPoint. Yet they reported record profits of $12.2 billion.” But the Times didn’t tell readers that the study came from HCAN—Health Care for America Now, an advocacy group that supports many of the reform ideas incorporated into the health bills.
According to HCAN, WellPoint indeed lost nearly 1.4 million customers. But not all of them were in the individual market—which was the subject of this story, or so I thought. The total included those with employer-sponsored insurance, individual policies, and some 350,000 government-sponsored plans, like Medicare. An apples and oranges problem here that needed clarification. The connection between losing members and the five companies’ record profits could have been better clarified, too.