by Hamilton E. Davis

The Vermont health care reform project debuted in July of 2011, and has moved steadily forward since. The Vermont reform is the most advanced in the U.S., but it has never been adequately understood, and it has had to overcome a constant drumbeat of opposition—from elements of the legislature, from the Health Care Advocate, from much of the primary care community, from some of the community hospitals, from the social services community, from the political left and the political right.

The single most critical element of the opposition, however, has come from the “press,” and in Vermont today, the press is VTDigger, the web newspaper founded in 2009 by Anne Galloway, a former copy editor for the Barre Times Argus. From a standing start, Galloway built one of the most important new news organizations to arise out of the rubble field of American journalism. She started almost by herself, a slight figure striding rapidly all over the Vermont State House, camera in hand, when the Legislature was in session. Writing story after story, raising the money herself, doing prodigies of work. Her web site today lists a newsroom of 21, including 16 who write stories. It also includes Glenn Russell, the best Vermont news photographer of the modern era; Jim Welch a former Managing Editor of the Burlington Free Press, who moved on from Burlington to spend 20 years as an editor in Washington for USA Today; and Dave Gram, one of the best AP reporters from the era when journalism was, actually, journalism. A workforce of that size would have had a solid presence in the Vermont of 40 years ago, when there were two fully -staffed wire service bureaus, Burlington and Rutland were credible statewide newspapers, and there were serious local papers in Brattleboro, Bennington, White River Junction, St. Albans, St. Johnsbury and Newport. You could even find must-read articles in weeklies in places like Randolph, Essex Junction, and Barton….

Galloway made her bones as a journalist in the early teens when she broke the EB5 story, the scandal that painfully discomfited the whole top tier of Vermont politics, including the Washington delegation and the Shumlin administration. EB5 was an excellent piece of work, which put Digger on the national map and significantly expanded its fund-raising capability. Digger sells some ads on its web site, but as at most newspapers, the web ads don’t begin to cover the real cost of news gathering and production.

In my last post, (Digger Reverts to Garbage Journalism on Health Reform) I laid out the case for the claim that the first Digger story this fall on OneCare Vermont was catastrophically bad, filled not just with errors of fact, but marked by obviously preposterous stuff, like the clear implication that the cost of health care was going up by a third in one year. The recent troubling Digger coverage follows on a nearly three-year stretch from 2015 to late in 2017, when the Digger coverage of health care reform was uniformly terrible, replete with errors, misinformed analysis and clear bias.

Would Anne Galloway deliberately publish article after article filled with false and misleading information? My conclusion is that she absolutely has, for an extended period in the past, and is doing so now. That conclusion is very important both for its impact on health care reform, and for the more general question of how Vermonters get their information about public policy across the board.

Let’s Go to the Evidence

A bit of scene setting is required for an assessment of the Digger performance on reform. As I noted at the outset, the reform project, which got off to a very strong start in 2013, ran into a wall of opposition in 2014. A group of Chittenden County Democrats and Progressives in the state Senate, like Sens. Tim Ashe, Chris Pearson and Michael Sirotkin, launched a broad-based assault on the University of Vermont’s Medical Center hospital and its network of hospitals in Vermont and New York.

It was “gobbling up” all the small players. It was taking over or driving out independent physicians, which the opponents said would increase costs. Over the following three years, the “gobbling up” theme morphed into a tale of greed and lust for power on the part of the UVM network and particularly its CEO John Brumsted that has wrecked UVM’s public image and still poses a serious threat to health reform.

A second form of opposition arose in the form of a significant portion of the primary care community, particularly several of the Federally Qualified Health Care Centers (FQHCs). An FQHC is a small group of primary care docs who get special subsidies from the federal government to ensure the delivery of care to under-served areas.

A third source was a separate group of primary care docs, and some stand-alone specialists that set up an organization to advocate for its own stand-alone surgical center to “compete” with UVM; and in the effort to get the necessary permit, its executive director, Amy Cooper, denigrated UVM at every opportunity.

Any news organization would wade right in to such a target-rich environment, and Digger did so. The question is: was its coverage even-handed and competent?

That assessment has to be broken into three sections. The first started in 2015 and ran to November of 2017. The reporter doing the work for Galloway in that era was a woman named Erin Mansfield. Her work, in my judgment, was very poor, filled with errors of commission and omission and was clearly biased. I’ll get into that further below.

In any event, Galloway fired Mansfield in late 2017 and replaced her with a guy named Mike Faher, who had worked for some years as a reporter in Brattleboro. Overnight, the Digger coverage on health care turned around. Faher had no special expertise or insight into the health care reform hairball; but he dug right in and produced a series of reports on what he could see in front of him, and they were fine—straight forward, no thumbs on the scale. The players in the reform field were almost giddy with relief. They even fell to speculating that Faher’s stories were fair because that is how is name is pronounced. The rat-at-tat opposition continued to flow from the normal array of opponents, but once it was mediated by normal press coverage, the temperature in the reform space dropped markedly.

The interregnum lasted just under two years. It terminated last summer with a huge argument in the Digger offices between Faher and Anne Galloway. Faher, a middle-aged guy with no job, quit on the spot. The argument was audible in the newsroom, a fact that gave rise to reports that Faher had objected to pressure from Galloway to hit UVM harder. I called Faher sometime later to ask about his confrontation with Galloway, and he refused to discuss it. Faher later went to work as a writer for UVM.

Last fall, Galloway hired Katie Jickling for the health care beat. The Digger website describes Jickling as a native of Brookfield, who interned at several news outlets before getting a permanent gig covering Burlington for the weekly paper, Seven Days. Although Jickling had no experience covering health care, she parachuted into the most vital, expensive and complex policy issue Vermont has seen in the modern era. Her first major piece ran on Oct. 20 of last year (“OneCare Vermont seeks approval of $1.36 billion budget”). It was full of errors and misleading conclusions. And the hectoring tone on both UVM and OneCare Vermont was striking. I count 19 Jickling stories bearing on health care reform, starting with her first piece on Oct. 20—the first report on the OneCare 2020 budget. All but four of those appear to me to advance the theme that UVM and OneCare are, at best, bumbling players that are degrading the delivery system. Much of the evidence for that proposition is simply wrong.

The reform system hasn’t saved any money. Not true. The annual inflation rate for the hospital system has been cut in half from 2013 to 2019. When compounded that performance has saved Vermonters just under $2 billion.
OneCare Vermont, a for profit company, is losing money and needs to be bailed out by the Legislature. Wrong. OneCare Vermont is legally required to be for-profit, but it neither makes profit nor suffers losses. It doesn’t have to be bailed out.
OneCare plans to “control” the delivery of care across the Vermont system. Wrong. OneCare is a small bureaucracy that manages the contracts between the various payers and the hospitals. The actual control of delivery of health services rests with the doctors and hospitals in the state. Every doctor and every hospital is free to withdraw from OneCare, if it chooses to.

The real problem is that neither Jickling nor anyone else at Digger understands what OneCare is actually all about.

An ACO like OneCare was invented in the federal law known as Obamacare. Its purpose is simply to provide an umbrella under which doctors and hospitals can come together to deliver all the necessary care to a block of patients for a fixed price. A Vermont example was the first contract in which Vermont Medicaid paid $93 million to four Vermont hospitals and some primary care doctors to provide care to 31,000 Medicaid recipients in the northwest quadrant of the state.

The key to this is the term “fixed price.” Each hospital got a check at the beginning of each month for taking care of the Medicaid patients that would come through its doors that month—and there wasn’t any more money coming, even if more patients than expected showed up and the hospital delivered more services to each patient than it expected. That process the precise opposite to the normal health care market, in which the more the docs and hospitals do, the more they get paid—by the public. This “fee-for-service” system is the engine that has driven health care costs in Vermont and the rest of the country into the stratosphere.

The new reimbursement project puts the doctors and hospitals at risk for the financial performance of the system that they run. That is the whole purpose of OneCare Vermont. It is just a box in which providers can cooperate to deliver care at a fixed price. The people who work in the box facilitate the contracts between the doctors and hospitals and the individual payers—Medicaid, Medicare, and private insurers like Blue Cross and MVP.

Digger and the Mansfield Era

An obvious question about the last couple of months of Digger coverage is whether the problems are the result of a new reporter who could get better over time. That is clearly possible, but a confounding issue is the almost-three year stretch from 2015 through most of 2017 when Digger operated a classic vendetta against the University of Vermont, its hospital network and OneCare Vermont, the ACO owned by UVM and Dartmouth-Hitchcock. The Digger coverage over that time was carried out by a reporter named Erin Mansfield. The Mansfield oeuvre is on line, and I suspect that some of my tiny corps of brilliant readers will want to read it to assess the validity of my assessment. For the rest, I offer here a detailed look at what I consider a typical performance: the Digger article of July 17, 2016 with the headline—“Special Report: Despite regulation, profits up.”

The top of the story notes that in the 10 previous years, Vermont’s hospitals had more than doubled their assets, tripled their profits, and increased the cash “they have on hand for rainy days.” Four hospitals had seen asset growth from 2001 to 2016. “An analysis by VTDigger shows that, although individual hospitals vary, Vermont’s 14 hospitals have, on average, improved their financial footing since the Green Mountain Care Board started regulating hospitals in fiscal year 2013.” The piece pays particular attention to what it describes as profits. “The total operating surpluses—also known as profits—tripled from $37.3 million in fiscal year 2006 to $110.4 million in fiscal 2015….

Assessment: There are all sorts of problems with this mess. They start with the headline, an indictment of “regulation,” which Digger asserts did nothing to prevent the hospitals from having a party at the expense of the public. For one thing, the figures used in the indictment range back as far as 2001 in one case to 2006 in another. That was why the Green Mountain Care Board members were so blown away by this broadside—none of the specific figures had anything to do with them. The story notes that the Board didn’t exist until 2012, but that got lost in the numbers that go back far before that.

Another major problem: Digger insists on describing the excess of revenues over expenses, the bottom line or margin, for the hospitals, as profits. They aren’t in a non-profit system. Calling them that is just a cheap way to slam somebody. It looks like greed, when in fact you can’t use that money for a party—it has to stay in the hospital coffers. And in any case, they are relatively small, low single digits while the real money is in the operating budgets. It is ironic that Digger entirely missed the fact that from 2000 to 2009, the hospitals did have a party: they doubled their budgets in the ‘aughts — the big docs and administrators took home huge pay increases in a system where some 60 percent of the expenses go to labor. The party was over once the Green Mountain Care Board got revved up in 2013 and cut the historical annual inflation rate in half; but that didn’t fit the Digger narrative.

You have to have at least a modicum of knowledge to find the blotches in above, but a reader with no knowledge of the issues at all could see Digger wandering into the weeds. I’ll cite the whole section in this assessment.

“And while net revenue from patient care is down to about $2.3 billion annually, the amount that hospitals charge insurance companies for services has been approaching $5 billion.”

Reality: Net patient revenue has never in the modern era come down. The total of $2.3 billion cited here is the total hospital spending; of that roughly half, or around $1.15 billion. is paid by government and the other $1.15 billion by private payers. The assertion that hospitals are charging private payers five billion has no connection to reality.

A second error: “Hospital budgets have been regulated for more than two decades. In 1992, the Legislature passed a law giving regulatory power to a now-defunct agency called the Hospital Data Council.”

Reality: The Vermont Hospital Data Council was established (around 1980) and it never had any regulatory power. (I was appointed its chairman in 1987, and if I had had any power, I would have known it.) The Legislature established state power to set hospital budgets in 1995.

The story above showed how skewed the Digger coverage of an issue could be. But there was another problem with Digger’s coverage—they would ignore clearly compelling news stories that didn’t fit Galloway’s narrative of evil machinations by the UVM devils. Example: the supposedly baleful effect of UVM’s network on the overall health care delivery system.

In the summer and fall of 2017, in response to an Ashe-led campaign, the Green Mountain Care Board ran a survey of Vermont doctors to ascertain their views on their working lives and their intentions for the future. The survey had a huge sample—more than 400 respondents in a state with fewer than 2,000 doctors—and it showed that neither primary care docs nor specialists were troubled by UVM’s role and that most intended to keep practicing as they had in the past.

A fully elaborated professionally designed survey like this is very rare in the political back-and-forth of policy debate, and it was equally striking that it so clearly ran counter to the narrative that had dominated Digger’s coverage for years. Digger never mentioned it….

In July of 2016, I was writing columns on reform for Digger, and I became concerned about Digger’s coverage. So I wrote a letter to Anne Galloway expressing that concern. I understand that this all may seem obsessive to my tiny corps of brilliant readers; but I am laying it out because I think it bears on the question of the likelihood that Digger will shift its health care coverage to a sound journalistic base.

July 26, 2016

Anne:

I believe that the Digger coverage of health care reform over the last couple of months is badly skewed. I have no idea whether you are willing to consider this, but I thought I would lay my concerns out in writing.

There have been three or four pieces that are troubling to me, but the issues seem to be concentrated pretty heavily in the Special Report: Despite Regulation, Hospital Profits Up. I consider this to be an absolute mess, starting with the headline. It blew away the Green Mountain Care Board and I don’t blame them. I don’t believe there is a vendetta against the board, but it sure looks that way.

The lead sentence sets the tone. Doubling assets, tripling profits etc. over the “last 10 years.” In the first place, there was no effective regulation until the Green Mountain Care Board went into operation in 2013. Nobody needs a special report to know that—its been written a thousand times. The GMCB isn’t responsible for that. And,
doubling assets, tripling profits, and days cash on hand don’t mean bupkus. Those numbers are brought forward just to make the board and the system look bad. Profits in a non-profit system are not profits. You have to give em back. You can’t just have a party with them. And if you don’t have them, you can’t borrow money at favorable rates. UMV used its increased bottom line to get a bump in its bond rating from BBB+ to A-, which will save patients millions of dollars over the life of the loans. And that is basically all days cash does—you can’t spend it on goodies because then it wouldn’t be “on hand.” And consider Porter Hospital in Middlebury. Days cash is 70 to 80 and their board is trying to sell themselves to somebody bigger, like UVM or DH or Rutland. The reason: low days cash makes them doubt whether they are a viable business.
The facts are that profits don’t amount to beans—as a number. Its three percent of the spend. The real issue is the other 97 percent, which is net patient revenue. (which your story said went “down to 2.3 billion, which it didn’t. It went up)
Here is a truly bizarre sentence: “And while net patient revenue is down to about $2.3 billion annually, the amount that hospitals charge insurance companies for services has been approaching $5 billion.” What the hell does that mean? Net patient revenue is what hospitals get paid. So, having gotten paid, they are now trying to double their money to $5 billion? Really?
What this kind of stuff is doing is teeing up the board and the system for health care reform opponents like Tim Ashe, and political gasbags like Galbraith, who are using your stuff as a club to beat on both the hospitals and the board.
Totally absurd stuff:
“Hospital budgets have been regulated for more than two decades. In 1992, the Legislature passed a law giving regulatory power to a now defunct agency called the hospital data council.” This is all wrong. The data council was established in 1983 (I was its third chairman, starting in 1987) and it never had any regulatory power at all. The state didn’t assume power to regulate hospital budgets until 1995.
A few weeks ago, Erin had a story talking about the split in the negotiations over a statewide ACO. She cited John Michael Hall and Patrick Flood and their testimony to legislators several months ago. That was all accurate; I wrote some of it in my column. The problem: it was months’ old. And at the time it was published, Flood had basically been kicked out of the group, and Hall and Moulton had shifted to the other side because of the behavior of Sharon Winn and Bi-State. No harm, no foul, but it looked ridiculous.
Digger coverage of the issues of Blue Cross and MVP rates is similarly garbled, but there is a consistent undertone of slanging at Al and the board, which is make them crazy.

I am not going to go into either of those issues because I’m tired of it all. I have always admired your reporting and I have liked working with you. I also understand how brutally hard it is to run even a small news organization. I barely made it two years—and I didn’t have to chase money at all.

But this state and its people have something like a half-billion dollars invested in health care reform. And I personally have 40 years into it. So, I am going to write about how skewed your coverage is. Nothing personal—if I was running a news organization, I would hire you first—but in my book, nobody gets a free ride for coverage like I have seen in the last two months. Health reform may fail, but I am going to do my best to make sure it doesn’t fail because nobody presented the public with the facts.

ham

Galloway’s response to this was that I was a shill for UVM and that she was sticking with Mansfield. At that point, I quit working for Digger. Fifteen months later, Galloway fired Mansfield and hired Mike Faher. And when Faher walked, she signed up Jickling.

Whither the Future

Given this record, what can we expect from Digger on health care going forward? It is impossible to know for certain. News coverage of an issue can turn on a dime, as evidenced by Digger going from full-on trash mode in the Mansfield era to full-on fair in the Faher interregnum and back to trash in the current Jickling tenure. It is also true that, while Galloway makes all the calls, there are real journalists in and associated with Digger, and they could have some impact on her trajectory. In fact, much of daily work pumped out by Digger’s mostly-young reporters is perfectly straight forward.

It is also true, however, that at the luminary level—on the issue of health care alone—there hasn’t been any visible light at all. In that sector, the luminaries have been hood ornaments. And there is no blinking the consequence: the health care project is about 85 percent of the way to real sustainability, something that has never been achieved in the United States. But the last 15 percent will be incomparably harder than reformers have experienced so far. The Digger narrative that reform so far has been a failure, and that the problem lies with the greed and lust for power on the part of UVM has infected the body politic and it is not clear it can be overcome.

I have been involved in this issue for 40 years, as a journalist, a regulator, a special counsel to the governor for health policy, a legislator and a member of the senior management in the UVM system; and I now believe that the chances for success are now less than even. Failure would be hugely damaging to every Vermonter, in both the medical and financial sense.

The issue will turn in significant measure in my view on whether the public and the legislature get the clearest possible picture of the whole process and the implications of each individual decision. They are not getting that now. I’ll post more on these issues in the next couple of months, but in the meantime, keep in mind:

Caveat lector: Reader Beware.