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January 23, 2014

This critique has been updated twice, most recently on August 22, 2014. Click here to see those updates.

A PolitiFactoid.com Critique of...

In Michigan, Businessmen and Politicians Agree on Medicaid

as reported by Eric Whitney , NPR Morning Edition, January 20, 2014
(click here for the story at NPR.org)

This is the second NPR story about the federal Affordable Care Act (a.k.a. Obamacare or ACA) to be critiqued here at Politifactoid.com. (Click here for the first critique.) This Michigan story, while not as blatantly out of whack as the first one, still contains numerous problems and too much spin. See the critique below, which appears as dark blue, indented type, embedded in excerpts from the story as reported on NPR.

Story intro, read by Morning Edition host Renee Montagne:
Republican Party leaders say their number-one campaign issue for the mid-term elections is thwarting Obamacare. At the same time, a growing number of Republican states are now saying 'Yes!' to a major provision of the law: expanding Medicaid, the health care program for the poor. The Supreme Court made the expansion optional, and most Republican-led states said no, even with the federal government covering the majority of costs. But now, some of those same states are forging compromises with the White House to accept the federal money. Eric Whitney has the story of how Michigan decided to expand, starting with one of the biggest hospitals in Detroit.

Note the very first idea conveyed in this intro: The GOP wants to thwart Obamacare and make it the top issue in the mid-term elections. That's the focus of this story? That's the number-one idea in the lede? The story's material about Medicaid expansion under the Affordable Care Act in the state of Michigan is just incidental fluff, I guess.

For NPR reporters and editors, everything about the ACA revolves around Republicans and their post-ACA behavior, with special emphasis on the politics of the upcoming mid-term elections. They seem compelled to bring up Republicans and their own take on Republican politics in any news story about the ACA, despite the fact that there are many, many other aspects about the ACA that need exposure; however, virtually all of those other aspects would make Obama and the Democrats look bad, so draw your own conclusions about that.

On the other hand, I'm glad to see that NPR has changed its tone a bit regarding how much of the cost of Medicaid expansion will be paid by the federal government. The intro indicates the feds will cover "a majority" of the costs, instead of 100% of the costs in the initial years, as has been reported previously.

Reporter Eric Whitney:
Scenes like this one play out hundreds of times a day all across the country.

Unidentified health care provider:
The airway is intact. Lung sounds...

A team of doctors and nurses is assessing a patient just rushed into an emergency room.

Unidentified health care provider:
Do I have an initial blood pressure here yet?

Because this emergency room is in Detroit, there's about a one-in-three chance that the patient being swarmed over is uninsured. That's a much higher rate than the rest of Michigan. That means hospitals like this one – Henry Ford Hospital – end up providing a lot of health care for free. Hospital CEO Nancy Schlichting says even as Detroit has lost nearly a quarter of its population in the last decade, the amount of free or uncompensated care her hospital provides has skyrocketed.

Nancy Schlichting, sound bite #1:
About seven, eight years ago, we were at about $100 million a year. We're now at $240 million a year in uncompensated care.

We have no reason to doubt these dollar figures quoted by Ms. Schlichting. However, they don't tell the whole story. Whitney failed to inform listeners that states and the federal government have programs to compensate hospitals for their losses in providing uncompensated care.

For example, the federal Disproportionate Share Hospital program (or DSH program, pronounced "dish") pays-out such funding for hospitals that provide a disproportionately high amount of charity and Medicaid care, in order to compensate them for their losses. In federal fiscal year 2011, Michigan's total DSH expenditures were $387.9 million, including federal and state dollars, and in federal fiscal year 2014 (when this NPR story aired), the federal government has allotted $282.6 million in DSH funds for Michigan, not including state dollars.

Whitney didn't tell us about these sorts of programs for some reason. I wonder if that's because it would diminish the point he was trying to make.

So when the Affordable Care Act offered Michigan the chance to give Medicaid benefits to some 400,000 more residents, Schlichting knew that would mean a lot more people she was already treating would now have a way to pay their hospital bills...

Not exactly. The ACA did not  "offer" Michigan or any state "the chance" to expand Medicaid. The law, as written, requires states to either expand Medicaid or exit the program altogether. The U.S. Supreme Court ruled that requirement to be an unconstitutional coersion, and that ruling rendered the expansion optional for states.

That whole dynamic is lost when Whitney frames it as the ACA "offering" states "the chance" to expand Medicaid. The expansion was "offered" in much the same way the IRS "offers" you the chance to pay your taxes.

Also, people receiving Medicaid benefits do not and will not "pay their hospital bills." The Medicaid program pays their hospital bills. To the extent that some enrollees might owe copays under Michigan's expanded program, Medicaid will not help people pay for those.

Whitney (cont.):
She lobbied hard for the state to say yes.

Schlichting, sound bite #2:
We were very active in advocacy. We got all of our employees engaged. We had over 5,000 emails that went to state legislators, as they were debating the Medicaid expansion for the state of Michigan. So, you know, we almost shamed people into it. You know, how can you turn your back on the people of this state who have lost jobs?

But Republicans saw themselves as turning their backs on Obamacare, not the people of Michigan. State Representative Al Pscholka was one of them.

There are no sound bites from any Republicans describing themselves as "turning their backs" on anything. Instead, Whitney picked up that image from an advocate for Medicaid expansion and used it to describe how Republicans view themselves. If Republicans actually view themselves in such a negative sense, why didn't Whitney let us hear it? Maybe because it was more convenient for Whitney to just paint Republicans' self-image that way on his own. Not exactly a positive image, is it?

State Representative Al Pscholka sound bite #1:
Yeah, here you are.

Pscholka's district is on the southeast shore of Lake Michigan, and includes the historic town of Benton Harbor.

Pscholka sound bite #2:

Lake Michigan in December – still a nice view. Come on, and you got ice.

It's a solidly Republican district. Pscholka says Obamacare doesn't have a lot of fans here.

Pscholka sound bite #3:
When people say, 'Medicaid expansion,' I think to a lot of us, that meant bigger government, and it meant expanding a program that doesn't work very well.

Pscholka is a Republican Party leader in the Michigan House. He was asked to look at ways to reform Medicaid. But then, Republican Governor Rick Snyder came out in favor of Medicaid expansion last year. Snyder argued that if the state didn't expand, the millions of dollars in Affordable Care Act taxes and fees Michigan would be paying would just go to other states, and not come back home in the form of new payments to hospitals and doctors. Pscholka says when he took a hard look at Medicaid, he didn't find the broken, bloated government program he was expecting.

I have already debunked this notion that taxpayers in non-expansion states will automatically pay for Medicaid expansion in other states. (See here.) NPR used that notion once again in this story. How many more times will NPR perpetuate that theory without explaining that it just doesn't work that way in a practical sense? Just because the reporter attributes that theory to someone else does not absolve the reporter of the duty to reflect reality.

Pscholka sound bite #4:
When I understood how it worked and what we had done in Michigan in the late '90s, it was actually pretty smart. We've privatized a lot of that already, which I think a lot of folks didn't understand.

Medicaid is a government-funded program, but Michigan long ago started contracting with private sector HMOs to administer it. Pscholka says that makes it easier for conservatives to stomach, and he helped draft legislation to accept Medicaid expansion dollars, but with some conditions. That doesn't mean every Republican in the state is convinced that putting more people on Medicaid is the right way to go. The bill to expand it only passed by one vote in the state Senate.

Whitney does nothing to explain that it really doesn't matter whether a state has "privatized" its Medicaid program by employing managed care. Managed care has virtually no bearing on the fiscal and practical realities involved in whether Medicaid expansion is a good idea for any particular state.

Pscholka sound bite #5:
This is not an easy thing to explain. It's not an easy thing to get up at my county GOP meeting and look at friends of mine – who've been friends of mine for 20 years – who are now shooting darts at me with their eyes and can't believe that I was even involved in this – not only that I voted for it, but that I was somehow involved in crafting this legislation.

Pscholka's change of heart on Medicaid earned him a primary challenge from a tea party candidate. But she's a longshot to beat him, and those favoring expansion have some strong allies beyond Michigan's popular governor...

Whitney is apparently not only a reporter, but he's also achieved a level of expertise in election prognostication that qualifies him to tell us that Pscholka's "tea party" opponent is a "longshot." Is this opinion espoused by Whitney based on something other than his own personal impression? We don't know, because he didn't tell us, but he did make sure to plant the idea in our heads that a "tea party candidate" doesn't have much chance of winning.

UPDATE #1: (January 27, 2014) After writing this critique, I decided to look-up Pscholka's challenger at the Michigan Department of State's web site. She is Cindy Duran, a registered nurse claiming to have first-hand knowledge of the Medicaid system. See her web site here.

By the way, I can find nothing on Duran's web site relating to any tea party or tea parties. In a video on the site, she says she supports a Republican party devoted to conservative principles. Aren't all Republicans supposed to feel that way? The only sources I can find that call her a "tea party candidate" are news media web sites, now that they've done their best to make a dirty word out of "tea party." – All right, yes, maybe she is a longshot. Most challengers facing incumbents are longshots. However, Whitney shouldn't give his opinion about that. He's supposed to be an impartial reporter, not an expert witness.

UPDATE #2: (August 22, 2014) Pscholka defeated Duran in Michigan's August 2014 primaries.

Whitney (cont.):
Hospitals, doctors, and the state's small business association all rallied behind the idea. Cynthia Kay owns a video production company in Grand Rapids with eight employees. She hopes putting more people on Medicaid will help keep the price of her company's health insurance plan down in the future.

Cynthia Kay sound bite:
We're paying for the cost of health care anyway. Uncompensated cost of care is driving my premiums up every single year. So, whether I think I'm paying for it or not, I'm paying for all the people who are using the emergency room as their primary care physician.

Wait a minute. Didn't Whitney tell us earlier in the story that hospitals have been suffering under the burden of providing all this uncompensated care "for free"? Now Whitney plays a sound bite telling us that the costs of uncompensated care are being built into the premiums for private insurance coverage.

So, is Henry Ford Hospital providing $240 million per year in uncompensated care, or is Cynthia Kay's video production company "paying for all the people who are using the emergency room as their primary care physician" by paying higher premiums? You can't have it both ways, Mr. Whitney.

Advocates for the poor are thrilled so many uninsured Michigan residents will now be able to get Medicaid, but worry about some significant details that have yet to be finalized.

So, advocates for the poor are thrilled. What do people opposed to the expansion have to say? Why were they opposed? The bill passed the Michigan Senate by only one vote, according to Whitney. Why was it so close? There must be at least a few compelling arguments in opposition to expansion. Why did Whitney choose not to give us any of that?

Jan Hudson sound bite #1:
I think it's going to be complicated.

Jan Hudson is an analyst at the Michigan League for Public Policy, which advocates for low-income people. Among the compromises the White House made to win Republican support in Michigan are requirements for some Medicaid recipients to pay for at least part of their care.

To say they're required to pay for "at least" part of their care implies that they might have to pay for all of their care. I'm not sure why Whitney threw "at least" into the mix. It would have been more accurate and precise to say Republicans sought requirements for Medicaid enrollees to pay for "part of their care" instead of "at least part of their care."

Hudson sound bite #2:
Cost-sharing is always a concern for low-income people. The research says that that can be a barrier to people receiving the care that they need.

Whitney had been describing the "compromise" in a positive light up to this point, but with this quote from Hudson, he goes off on a negative tangent. Let's look at it more closely... The White House "compromised" by allowing Republicans to impose cost-sharing on Michigan's new Medicaid recipients, but cost-sharing is a barrier to people receiving care...

Oh, wait – now I see. The only way the White House could convince Michigan Republicans to expand Medicaid was to allow Republicans to set up barriers to care. Now I understand this part of the story – Republicans are heartless bastards who don't really want poor people to receive health care! Now I get it!

The White House is okay-ing cost-sharing in other states, like Iowa and Arkansas. Iowa recipients will pay extra if they overuse emergency rooms, and Michigan will charge them more if they don't stick with wellness plans designed to keep them healthy. Groups that favor Medicaid expansion nationwide point to those kinds of tweaks as evidence that the White House is willing to compromise and hope that will entice the 23 states that are still resisting expansion to take another look, and work out special arrangements of their own. For NPR News, I'm Eric Whitney.

Two important points need to be made here regarding "compromise" and cost-sharing:

  1. The idea of cost-sharing for the ACA's Medicaid expansion is not new – cost-sharing is built into the law. As you can see on page 4 of this issue brief by the Kaiser Family Foundation, the ACA provides that states may charge premiums, deductibles, copayments, or coinsurance for newly-eligible adults under Medicaid expansion, based on a number of parameters, and also may deny services because of non-payment in some circumstances.

    So, Whitney's implication that the White House magnanimously compromised on these parameters is a bit of a stretch and perhaps a bit disingenuous. And, even though cost-sharing is built into the ACA – which was enacted solely by Democrats – Whitney makes cost-sharing seem like a 100% Republican idea, then he points out how bad cost-sharing is because it creates barriers for poor people. Oh, those horrible Republicans and their horrible cost-sharing!

  2. One more thing about the White House's involvement in this "compromise," as described by both Montagne in the intro and Whitney in the story. Michigan had to apply for and be granted what's called a "waiver" in order to implement Medicaid expansion the way it has. States have been granted scores of Medicaid waivers over the years. States may apply for waivers from the federal Centers for Medicare & Medicaid Services (CMS), which is the part of the Department of Health and Human Services that oversees the Medicaid program nationwide. Waiver applications typically undergo thorough review by CMS bureaucrats at the rank-and-file level before either being approved or denied by CMS, not by the White House. They rarely rise to the level of the White House stepping in to negotiate and/or "compromise."

    Does anyone else find it odd that the White House would get involved at such a nitty-gritty level with one state's waiver application but would not know anything ahead of time about the Obamacare web site being a disaster waiting to happen? This White House that negotiated and compromised on the intricate details of Michigan's Medicaid waiver – this is the same White House that knew nothing about the IRS unfairly targeting conservative groups prior to and after the 2012 election? This is the same White House?

    Just wondering, because Whitney seems to take that for granted. We don't know for sure, but I suspect that the White House had very little, if any, involvement with Michigan's waiver application. Whitney, on the other hand, makes it sound like "the White House" compromised with Michigan Republicans directly, thereby making the White House look reasonable and open-minded when it comes to the ACA and dealing with Republicans.

Lastly, Whitney closes his story by pointing-out the thoughts and hopes of groups that favor Medicaid expansion. What are groups that oppose expansion thinking and hoping? Whitney gives us nothing about that. Without any balance along those lines, this story tends to become more of a public relations piece in favor of Medicaid expansion – with a subtle yet strong slice of Republican-bashing – rather than an actual news story.


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