Journalists threw the public for a loss last week when reporting on the tentative settlement of a lawsuit brought by former professional football players with concussive brain injuries against the National Football League. As reported, the story was about a minority of retired players, a story of interest mostly to the minority of Americans who are football fans.
The story missed was much bigger and matters to a much larger audience than football players and fans—arguably, to every person in the United States. In reviewing coverage by major newspapers, wire services and broadcast news organizations, I found only one reporter who touched on the big story, and then only tangentially.
First, let’s review the coverage to see what was reported and then examine the big play that reporters fumbled.
Sam Farmer of the Los Angeles Times put the official version of events succinctly:
The NFL and more than 4,500 retired players reached a proposed $765-million settlement of concussion-related lawsuits, a court-appointed mediator announced Thursday.
Former US District Judge Layn Phillips announced the parties have agreed to a deal that would end the litigation against the NFL and NFL Properties and provide medical and other benefits, as well as compensation to qualifying injured players and their families.
That $765 million number, many news reports noted, is tiny compared to NFL revenues—a fraction of one percent of likely revenues over the next two decades. That detail was the first sign that reporters gave some thought, just not enough, to the NFL’s real game.
The settlement figure seems large on its face, but begins to shrink when taking into account the time value of money—an issue Ken Belson raised in a useful New York Times explainer, though without doing any arithmetic for readers.
As Belson noted, half the money will be paid in the first three years, with the other half spread out over the following 17. The deal will adjust later payouts for inflation. But the delayed payment schedule means owners will come out ahead if their return on their money is greater than the inflation adjustment. And if injury-related care expenses rise faster than inflation, as has been true for medical costs over the past several decades, a general inflation adjuster would not fully protect the players. The fine details of the agreement have not been made public yet, only the broad deal terms.
Still, that is a minor part of the story, looking at who is on the line, not the scrimmage.
So is the fact, widely reported, that as much as $89 million, or 11.6 percent of the total, would go for baseline medical tests, medical research grants and up to $4 million just to inform the players of the terms, or about $889 per player. Legal fees would be on top of the settlement amount.
The average left after those costs above is just $150,000. [Update: To arrive at these illustrative calculations I divided the settlement figure by the approximately 4,500 plaintiffs. Dividing by the full list of retirees and surviving spouses—several times larger—would reduce the average per-player allotment.] Since some players, or their families in the case of dead players, may collect as much as $5 million, even that average figure is inflated. That figure, a typical payout of less than $150,000 per player, should have set reporters to asking if it was in fact enough to cover the players’ medical costs. NFL players only have health insurance
while workingfor the length of their careers plus five years, a highly relevant detail for any industry that knows many workers will be unemployable due to on-the-job injuries.
The Baltimore Sun’s Aaron Wilson and Mike Klingaman had a better-than-average piece because they included player comments about dissatisfaction with the payouts under the tentative agreement. Their piece—and some others that raised questions about whether the players had settled too cheaply—was a good step in the direction of the bigger story. But still, it fell short.
A Forbes contributor, Patrick Rishe, went further, analyzing the economics from the players’ point of view. Rishe, a professor of economics at Webster University in St. Louis, dissected the settlement to show that it cannot possibly cover the lost wages and medical bills the former players will face during their lifetimes.
Still, Rishe missed the big story by not asking an obvious question: If the settlement does not cover all the costs of medical care, much less lost future wages, who will bear that burden?