NOTE: I don't stream anything, I don't play online games. I want my TV totally separate from the internet.
Excerpt
SUMMARY: Media companies are spending billions to try to lock in Americans’ entertainment dollars, and on Tuesday, the Walt Disney Company took its efforts to the next level with the launch of Disney+. But with such a broad assortment of streaming services available, how can consumers decide on the best entertainment options for them?NPR television critic Eric Deggans joins John Yang to discuss.
SUMMARY:The Amazon is the world’s largest rainforest and a critical line of defense against climate change. But it’s been steadily deforested since the 1970s, with nearly 20 percent of its land area wiped out. This year, pervasive forest fires destroyed vast expanses of rainforest, and Brazil’s growing agribusiness is poised to transform more into farmland. Amna Nawaz reports from Mato Grosso, Brazil.
SUMMARY:An Oklahoma judge delivered a $572 million judgment against pharmaceutical giant Johnson & Johnson in the first major legal decision to go against a drugmaker for its role in the opioid crisis. The judge found the company’s marketing practices helped flood the state with painkillers. William Brangham talks to StateImpact Oklahoma’s Jackie Fortier about the case's unusual argument and broad impact.
SUMMARY: In April, Facebook CEO Mark Zuckerberg told Congress that his platform doesn’t “sell any data to anyone.” But now, documents released by a British Parliament committee suggest the social media giant was trading access to user data in exchange for advertising dollars. Nick Schifrin speaks with the Washington Post’s Elizabeth Dwoskin for specifics on the accusations and Facebook's response.
Patients may think their insurers are fighting on their behalf for the best prices. But saving patients money is often not their top priority. Just ask Michael Frank.
This story was co-published with NPR.
Michael Frank ran his finger down his medical bill, studying the charges and pausing in disbelief. The numbers didn’t make sense.
His recovery from a partial hip replacement had been difficult. He’d iced and elevated his leg for weeks. He’d pushed his 49-year-old body, limping and wincing, through more than a dozen physical therapy sessions.
The last thing he needed was a botched bill.
His December 2015 surgery to replace the ball in his left hip joint at NYU Langone Medical Center in New York City had been routine. One night in the hospital and no complications.
He was even supposed to get a deal on the cost. His insurance company, Aetna, had negotiated an in-network “member rate” for him. That’s the discounted price insured patients get in return for paying their premiums every month.
But Frank was startled to see that Aetna had agreed to pay NYU Langone $70,000. That’s more than three times the Medicare rate for the surgery and more than double the estimate of what other insurance companies would pay for such a procedure, according to a nonprofit that tracks prices.
Fuming, Frank reached for the phone. He couldn’t see how NYU Langone could justify these fees. And what was Aetna doing? As his insurer, wasn’t its duty to represent him, its “member?” So why had it agreed to pay a grossly inflated rate, one that stuck him with a $7,088 bill for his portion?
Frank wouldn’t be the first to wonder. The United States spends more per person on health care than any other country. A lot more. As a country, by many measures, we are not getting our money’s worth. Tens of millions remain uninsured. And millions are in financial peril: About 1 in 5 is currently being pursued by a collection agency over medical debt. Health care costs repeatedly top the list of consumers’ financial concerns.
Experts frequently blame this on the high prices charged by doctors and hospitals. But less scrutinized is the role insurance companies — the middlemen between patients and those providers — play in boosting our health care tab. Widely perceived as fierce guardians of health care dollars, insurers, in many cases, aren’t. In fact, they often agree to pay high prices, then, one way or another, pass those high prices on to patients — all while raking in healthy profits.
ProPublica and NPR are examining the bewildering, sometimes enraging ways the health insurance industry works, by taking an inside look at the games, deals and incentives that often result in higher costs, delays in care or denials of treatment. The misunderstood relationship between insurers and hospitals is a good place to start.
Today, about half of Americans get their health care benefits through their employers, who rely on insurance companies to manage the plans, restrain costs and get them fair deals.
But as Frank eventually discovered, once he’d signed on for surgery, a secretive system of pre-cut deals came into play that had little to do with charging him a reasonable fee.
After Aetna approved the in-network payment of $70,882 (not including the fees of the surgeon and anesthesiologist), Frank’s coinsurance required him to pay the hospital 10 percent of the total.
When Frank called NYU Langone to question the charges, the hospital punted him to Aetna, which told him it paid the bill according to its negotiated rates. Neither Aetna nor the hospital would answer his questions about the charges.
Frank found himself in a standoff familiar to many patients. The hospital and insurance company had agreed on a price and he was required to help pay it. It’s a three-party transaction in which only two of the parties know how the totals are tallied.
Frank could have paid the bill and gotten on with his life. But he was outraged by what his insurance company agreed to pay. “As bad as NYU is,” Frank said, “Aetna is equally culpable because Aetna's job was to be the checks and balances and to be my advocate.”
And he also knew that Aetna and NYU Langone hadn’t double-teamed an ordinary patient. In fact, if you imagined the perfect person to take on insurance companies and hospitals, it might be Frank.
For three decades, Frank has worked for insurance companies like Aetna, helping to assess how much people should pay in monthly premiums. He is a former president of the Actuarial Society of Greater New York and has taught actuarial science at Columbia University. He teaches courses for insurance regulators and has even served as an expert witness for insurance companies.
The hospital and insurance company may have expected him to shut up and pay. But Frank wasn’t going away.
Patients fund the entire health care industry through taxes, insurance premiums and cash payments. Even the portion paid by employers comes out of an employee’s compensation. Yet when the health care industry refers to “payers,” it means insurance companies or government programs like Medicare.
Patients who want to know what they’ll be paying — let alone shop around for the best deal — usually don’t have a chance. Before Frank’s hip operation he asked NYU Langone for an estimate. It told him to call Aetna, which referred him back to the hospital. He never did get a price.
Imagine if other industries treated customers this way. The price of a flight from New York to Los Angeles would be a mystery until after the trip. Or, while digesting a burger, you’d learn it cost 50 bucks.
A decade ago, the opacity of prices was perhaps less pressing because medical expenses were more manageable. But now patients pay more and more for monthly premiums, and then, when they use services, they pay higher co-pays, deductibles and coinsurance rates.
Employers are equally captive to the rising prices. They fund benefits for more than 150 million Americans and see health care expenses eating up more and more of their budgets.
Richard Master, the founder and CEO of MCS Industries Inc. in Easton, Pennsylvania, offered to share his numbers. By most measures MCS is doing well. Its picture frames and decorative mirrors are sold at Walmart, Target and other stores and, Master said, the company brings in more than $200 million a year.
But the cost of health care is a growing burden for MCS and its 170 employees. A decade ago, Master said, an MCS family policy cost $1,000 a month with no deductible. Now it’s more than $2,000 a month with a $6,000 deductible. MCS covers 75 percent of the premium and the entire deductible. Those rising costs eat into every employee’s take-home pay.
Economist Priyanka Anand of George Mason University said employers nationwide are passing rising health care costs on to their workers by asking them to absorb a larger share of higher premiums. Anand studied Bureau of Labor Statistics data and found that every time health care costs rose by a dollar, an employee’s overall compensation got cut by 52 cents.
Master said his company hops between insurance providers every few years to find the best benefits at the lowest cost. But he still can’t get a breakdown to understand what he’s actually paying for.
“You pay for everything, but you can’t see what you pay for,” he said.
Master is a CEO. If he can’t get answers from the insurance industry, what chance did Frank have?
Frank’s hospital bill and Aetna's “explanation of benefits” arrived at his home in Port Chester, New York, about a month after his operation. Loaded with an off-putting array of jargon and numbers, the documents were a natural playing field for an actuary like Frank.
Under the words, “DETAIL BILL,” Frank saw that NYU Langone's total charges were more than $117,000, but that was the sticker price, and those are notoriously inflated. Insurance companies negotiate an in-network rate for their members. But in Frank’s case at least, the “deal” still cost $70,882.
With a practiced eye, Frank scanned the billing codes hospitals use to get paid and immediately saw red flags: There were charges for physical therapy sessions that never took place, and drugs he never received. One line stood out — the cost of the implant and related supplies. Aetna said NYU Langone paid a “member rate” of $26,068 for “supply/implants.” But Frank didn’t see how that could be accurate. He called and emailed Smith & Nephew, the maker of his implant, until a representative told him the hospital would have paid about $1,500. His NYU Langone surgeon confirmed the amount, Frank said. The device company and surgeon did not respond to ProPublica’s requests for comment.
Frank then called and wrote Aetna multiple times, sure it would want to know about the problems. “I believe that I am a victim of excessive billing,” he wrote. He asked Aetna for copies of what NYU Langone submitted so he could review it for accuracy, stressing he wanted “to understand all costs.”
Aetna reviewed the charges and payments twice — both times standing by its decision to pay the bills. The payment was appropriate based on the details of the insurance plan, Aetna wrote.
Frank also repeatedly called and wrote NYU Langone to contest the bill. In its written reply, the hospital didn’t explain the charges. It simply noted that they “are consistent with the hospital’s pricing methodology.”
Increasingly frustrated, Frank drew on his decades of experience to essentially serve as an expert witness on his own case. He gathered every piece of relevant information to understand what happened, documenting what Medicare, the government’s insurance program for the disabled and people over age 65, would have paid for a partial hip replacement at NYU Langone — about $20,491 — and what FAIR Health, a New York nonprofit that publishes pricing benchmarks, estimated as the in-network price of the entire surgery, including the surgeon fees — $29,162.
He guesses he spent about 300 hours meticulously detailing his battle plan in two inches-thick binders with bills, medical records and correspondence.
ProPublica sent the Medicare and FAIR Health estimates to Aetna and asked why they had paid so much more. The insurance company declined an interview and said in an emailed statement that it works with hospitals, including NYU Langone, to negotiate the “best rates” for members. The charges for Frank's procedure were correct given his coverage, the billed services and the Aetna contract with NYU Langone, the insurer wrote.
NYU Langone also declined ProPublica’s interview request. The hospital said in an emailed statement it billed Frank according to the contract Aetna had negotiated on his behalf. Aetna, it wrote, confirmed the bills were correct.
After seven months, NYU Langone turned Frank’s $7,088 bill over to a debt collector, putting his credit rating at risk. “They upped the ante,” he said.
Frank sent a new flurry of letters to Aetna and to the debt collector and complained to the New York State Department of Financial Services, the insurance regulator, and to the New York State Office of the Attorney General. He even posted his story on LinkedIn.
But no one came to the rescue. A year after he got the first bills, NYU Langone sued him for the unpaid sum. He would have to argue his case before a judge.
You’d think that health insurers would make money, in part, by reducing how much they spend.
Turns out, insurers don’t have to decrease spending to make money. They just have to accurately predict how much the people they insure will cost. That way they can set premiums to cover those costs — adding about 20 percent to for their administration and profit. If they’re right, they make money. If they’re wrong, they lose money. But, they aren’t too worried if they guess wrong. They can usually cover losses by raising rates the following year.
Frank suspects he got dinged for costing Aetna too much with his surgery. The company raised the rates on his small group policy — the plan just includes him and his partner — by 18.75 percent the following year.
The Affordable Care Act kept profit margins in check by requiring companies to use at least 80 percent of the premiums for medical care. That’s good in theory but it actually contributes to rising health care costs. If the insurance company has accurately built high costs into the premium, it can make more money. Here’s how: Let’s say administrative expenses eat up about 17 percent of each premium dollar and around 3 percent is profit. Making a 3 percent profit is better if the company spends more.
It’s like if a mom told her son he could have 3 percent of a bowl of ice cream. A clever child would say, “Make it a bigger bowl.”
Wonks call this a “perverse incentive.”
“These insurers and providers have a symbiotic relationship,” said Wendell Potter, who left a career as a public relations executive in the insurance industry to become an author and patient advocate. “There’s not a great deal of incentive on the part of any players to bring the costs down.”
Insurance companies may also accept high prices because often they aren’t always the ones footing the bill. Nowadays about 60 percent of the employer benefits are “self-funded.” That means the employer pays the bills. The insurers simply manage the benefits, processing claims and giving employers access to their provider networks. These management deals are often a large, and lucrative, part of a company’s business. Aetna, for example, insured 8 million people in 2017, but provided administrative services only to considerably more — 14 million.
To woo the self-funded plans, insurers need a strong network of medical providers. A brand-name system like NYU Langone can demand — and get — the highest payments, said Manuel Jimenez, a longtime negotiator for insurers including Aetna. “They tend to be very aggressive in their negotiations.”
On the flip side, insurers can dictate the terms to the smaller hospitals, Jimenez said. The little guys, “get the short end of the stick,” he said. That’s why they often merge with the bigger hospital chains, he said, so they can also increase their rates.
Other types of horse-trading can also come into play, experts say. Insurance companies may agree to pay higher prices for some services in exchange for lower rates on others.
Patients, of course, don’t know how the behind-the-scenes haggling affects what they pay. By keeping costs and deals secret, hospitals and insurers dodge questions about their profits, said Dr. John Freedman, a Massachusetts health care consultant. Cases like Frank’s “happen every day in every town across America. Only a few of them come up for scrutiny.”
In response, a Tennessee company is trying to expose the prices and steer patients to the best deals. Healthcare Bluebook aims to save money for both employers who self-pay, and their workers. Bluebook used payment information from self-funded employers to build a searchable online pricing database that shows the low-, medium- and high-priced facilities for certain common procedures, like MRIs. The company, which launched in 2008, now has more than 4,500 companies paying for its services. Patients can get a $50 bonus for choosing the best deal.
Bluebook doesn’t have price information for Frank’s operation — a partial hip replacement. But its price range in the New York City area for a full hip replacement is from $28,000 to $77,000, including doctor fees. Its “fair price” for these services tops out at about two-thirds of what Aetna agreed to pay on Frank’s behalf.
Frank, who worked with mainstream insurers, didn’t know about Bluebook. If he had used its data, he would have seen that there were facilities that were both high quality and offered a fair price near his home, including Holy Name Medical Center in Teaneck, New Jersey, and Greenwich Hospital in Connecticut. NYU Langone is one of Bluebook's highest-priced, high-quality hospitals in the area for hip replacements. Others on Bluebook’s pricey list include Montefiore New Rochelle Hospital in New Rochelle, New York, and Hospital for Special Surgery in Manhattan.
ProPublica contacted Hospital for Special Surgery to see if it would provide a price for a partial hip replacement for a patient with an Aetna small-group plan like Frank’s. The hospital declined, citing its confidentiality agreements with insurance companies.
Frank arrived at the Manhattan courthouse on April 2 wearing a suit and fidgeted in his seat while he waited for his hearing to begin. He had never been sued for anything, he said. He and his attorney, Gabriel Nugent, made quiet conversation while they waited for the judge.
In the back of the courtroom, NYU Langone’s attorney, Anton Mikofsky, agreed to talk about the lawsuit. The case is simple, he said. “The guy doesn’t understand how to read a bill.”
The high price of the operation made sense because NYU Langone has to pay its staff, Mikofsky said. It also must battle with insurance companies who are trying to keep costs down, he said. “Hospitals all over the country are struggling,” he said.
“Aetna reviewed it twice,” Mikofsky added. “Didn’t the operation go well? He should feel blessed.”
When the hearing started, the judge gave each side about a minute to make its case, then pushed them to settle.
Mikofsky told the judge Aetna found nothing wrong with the billing and had already taken care of most of the charges. The hospital’s position was clear. Frank owed $7,088.
Nugent argued that the charges had not been justified and Frank felt he owed about $1,500.
The lawyers eventually agreed that Frank would pay $4,000 to settle the case.
Frank said later that he felt compelled to settle because going to trial and losing carried too many risks. He could have been hit with legal fees and interest. It would have also hurt his credit at a time he needs to take out college loans for his kids.
After the hearing, Nugent said a technicality might have doomed their case. New York defendants routinely lose in court if they have not contested a bill in writing within 30 days, he said. Frank had contested the bill over the phone with NYU Langone, and in writing within 30 days with Aetna. But he did not dispute it in writing to the hospital within 30 days.
Frank paid the $4,000, but held on to his outrage. “The system,” he said, “is stacked against the consumer.”
COMMENT: This is a not only a story about immigrants, it is a story about greed. A company who wants to save money (bigger profits) by hiring people off-the-books THEN lying about it AND killing people. ALSO, the police are negligent for NOT fully investigating a murder and cover up.
"Treated Like Trash" by Kiera Feldman (Voice of America), ProPublica 5/4/2018
A death. A cover-up. An immigrant meets a terrible end in the Bronx.
This story was co-published with Voice of America.
The body of the young man lay in the middle of Jerome Avenue beneath the elevated train tracks, the scene lit by the neon blue sign above the shuttered El Caribe restaurant. A garbage truck sat mid-turn at the otherwise deserted intersection in the Bronx.
Emergency medical personnel arrived, records show, and pronounced the young man dead at 5:08 a.m. on Nov. 7, 2017.
The police came, too. Officers taped off the scene, and interviewed the truck driver and his assistant, according to records and interviews. The driver and helper, according to the police report, said the dead man was a stranger who had inexplicably jumped on the truck’s passenger side running board, lost his grip and was run over. The initial police report left blank the spot for the young man’s name.
Within hours, a Bronx News12 reporter said neighbors thought the victim was “a homeless man that they’ve seen in the area.” By afternoon, he was “a daredevil homeless man” in the Daily News.
The garbage truck belonged to Sanitation Salvage, among the largest commercial trash haulers in the city. A company supervisor eventually came to retrieve the truck and take it back to the company yard. Then, according to workers told about the night’s events, it was promptly sent back out without so much as a cleaning.
Two miles south of the accident, in a Bronx apartment off the Grand Concourse, a mother waited for her son. Hadiatou Barry, a Guinean immigrant, had come to the Bronx for a better life for her family. Her eldest son, Mouctar Diallo, 21, had a bed in the living room of their apartment. The young man often worked nights, and with the sun coming up should have been home asleep. But his bed remained empty.
Soon enough, Hadiatou Barry got the worst sort of news, a double-barreled blow of devastation and insult.
Mouctar Diallo's nighttime job had been as an informal helper on garbage trucks owned by Sanitation Salvage, and the truck he’d been working on that night had killed him. Then, she learned, the truck’s driver and main helper — men who’d known him for more than a year and paid him off-the-books for his help hauling trash to the curb — had claimed not to know him. The rest of the city now knew her son only as a homeless person.
“He is my son, and I want the truth for him,” Hadiatou Barry said in a recent interview. “In order for it to not happen to somebody else.”
The truth of Mouctar Diallo's death is that the authorities investigating the accident did not learn that he was a worker on the truck for at least two months, and that when they did, they took no action against the driver and helper who had lied to police. The Business Integrity Commission, the New York City agency charged with oversight of the commercial garbage industry, allowed both the driver and main helper to keep working. The police and Bronx prosecutors closed their investigation with no criminal charges.
Last Friday, Sean Spence, the Sanitation Salvage driver who authorities say ran over Diallo and lied about it, struck and killed another man, 72–year-old Leo Clarke. Clarke, walking with a cane, was crossing in the middle of a Bronx block Friday evening when he was crushed by the 40-ton truck. A police investigation is underway, and Spence now has been suspended from driving for Sanitation Salvage.
“Oh my God,” Hadiatou Barry said when told of Spence’s involvement in the second fatality.
The New York Police Department said lying to the police was not a crime. The department maintains it did a thorough investigation, collecting witness statements, 911 calls and videotape from the scene. The police, a spokesman said, had no authority to investigate the operations of a private sanitation company.
A spokeswoman for the Bronx district attorney said the Business Integrity Commission had made no criminal referral to prosecutors about the conduct of Sanitation Salvage’s employees and thus prosecutors had no cause to investigate further.
The Business Integrity Commission’s spokesperson said the commission was alerted to the possibility that the November death involved a worker in early January, during a meeting with labor advocates about conditions at Sanitation Salvage. The fact that it was Diallo who had been killed had been an open secret among the workers for months. Commission officials said they then confronted Spence and his chief helper, Chris Bourke, and that the two men confessed to having invented the tale of an unknown pedestrian jumping on the truck.
The commission spokesperson said the agency lacked the power to suspend the driver on its own. It said Spence was suspended after the second death because the commission asked the company to do so, and Sanitation Salvage complied.
Asked why the commission did not make that kind of request immediately after finding that a driver in a fatal accident had lied to police, a spokesperson declined to comment.
Several attempts to contact Spence were not successful.
Sanitation Salvage did not respond to multiple requests for comment over several weeks.
In an interview, Bourke, the main helper on the truck that killed Diallo, claimed not to know where the tale of the daredevil homeless man had come from. He said he only talked briefly to police, and couldn’t remember what he told them. Diallo, he said, “popped out of nowhere.”
To this day, Hadiatou Barry and former colleagues of Mouctar at Sanitation Salvage say they are not confident they know the truth about how Mouctar died. Helpers are not supposed to ride on the front running boards, workers say. They walk the street, haul trash to the curb and ride the back of the truck.
Every night in New York, an army of private garbage trucks from more than 250 sanitation companies sets out across the five boroughs picking up the trash from all manner of businesses. Racing to complete long and often circuitous routes, the trucks crisscross the city at breakneck speeds. The human toll is substantial: Since 2010, there have been 33 deaths attributed to private garbage trucks across the city.
Sanitation Salvage trucks, now involved in two deaths in six months, have failed federal safety inspections at a rate that’s four times the national average. A Department of Labor investigation found that the company had failed to pay hundreds of thousands of dollars in wages and that workers pulled 18-hour days. Drivers are so overtaxed that they hire additional helpers — often young men off the street — to try and complete their routes on time.
Mouctar Diallo was one of those, known at Sanitation Salvage as “third men.” It is unclear when Diallo arrived in the Bronx — the borough has one of greatest concentrations of Guinean immigrants in America — but he’d begun working for Sanitation Salvage in the late spring of 2016, according to interviews with co-workers. He first worked with a driver named Timothy Belgrave, and later with Vernando Smith. Diallo, nicknamed “Gotto,” was beloved for his intrepidness — he wasn’t afraid of rats — and the way he made everyone laugh. He’d been working with Spence and Bourke for over a year.
“Almost everybody there would know Gotto,” Smith, the former driver, said of workers and management at Sanitation Salvage. “They would see him on the truck. Maybe they didn’t know his name but they knew his face. He was the only African who worked for the company."
Such third men, according to interviews with 15 current and former workers, often got paid off the books, either directly by the company or out of the pockets of drivers and main helpers. The drivers and main helpers were then sometimes reimbursed by the company, according to current and former workers. Such informal payments were a testament to how impossibly long the routes were. A typical route at another company in the Bronx would be around 200 stops. At Sanitation Salvage, many routes had close to 1,000 stops, if not more.
Third men could make anywhere from $30 to $80 a night, for shifts as long as 18 or 20 hours, according to workers.
In 2015, after an investigation, the Department of Labor concluded that Sanitation Salvage owed workers $385,000 in unpaid overtime over the past three years. Sanitation Salvage refused to pay, claiming the workers were seeking to be paid for time actually spent hanging out with friends. When the department chose not to take the company to court, the issue ended.
Bourke, the helper who first recruited Diallo off the street, said of the long hours and demanding routes, “If you do the math, accidents will happen.” Waste and recycling work is the fifth-most fatal job in America.
“It’s not just about Gotto’s death,” Bourke said. “To work like this is unhuman. They’ll make you work like a slave. You can do 18 hours one day and, say, go home and get four hours of sleep and come back and do 12 hours.”
Voice of America and ProPublica sent Sanitation Salvage and its lawyers a detailed set of questions weeks ago — about Diallo’s death, the false account given by the driver and helper, the working conditions at the company, and its trouble with the Department of Labor. The company did not respond.
This week, the Business Integrity Commission said the second death and the accounts of dangerous working conditions had prompted an investigation that could result in halting the company’s operations or installing a monitor.
However, a coalition of labor, safe streets and Bronx community organizations are calling for an immediate suspension of Sanitation Salvage’s license.
“We take these workers’ allegations very seriously,” the commission said. “If the results of the investigation merit these actions or any others, they will be taken immediately.”
SUMMARY:The 2013 collapse of the Rana Plaza garment factory in Bangladesh killed more than 1,100, a tragedy that pressured Western clothing retailers and customers to take responsibility for work conditions. Five years later, signs suggest factories have improved, but progress is not universal. John Yang talks with Paul Barrett, Deputy Director of the Stern Center for Business and Human Rights.
SUMMARY: Downtown Nashville has been a backbone of the nation's music industry for more than six decades, giving the nation stars such as Willie Nelson and Dolly Parton. But the increasing demand for new apartments and office buildings is threatening its historic music spaces. Jeffrey Brown reports on the city's struggle to find a balance between preserving history and making room for the future.
JUDY WOODRUFF (NewsHour): Nashville often likes to refer to itself as Music City. And given its history and heritage, that seems just right.
But as real estate development explodes in one of the nation's fastest growing cities, some of the very studios, locations and neighborhoods that were so important to country music, and the industry as a whole, are now threatened.
Jeffrey Brown reports. It's part of his ongoing series on Culture at Risk.
JEFFREY BROWN (NewsHour): Inside an unassuming house on Nashville's 16th Avenue South, guitarist Philip Shouse is laying down a track at the recording studio 'House of David.' Meanwhile, just up the road, the punk rock group Paramore is recording percussion in 'RCA Studio A' for the group's forthcoming album.
It's just another day on Music Row, the collection of recording studios, publishing houses and offices two miles southwest of downtown Nashville and its famous honky-tonks, and the place collectively responsible for an important part of the nation's music industry.
TAYLOR YORK, Paramore: From, like, the early days even to present, there's been such an amazing group of people that have recorded here, you know, and when you walk into a room, you really can feel an energy and an inspiration.
JEFFREY BROWN:It all began in the 1950s, with Owen and Harold Bradley, brothers who opened a recording studio in a converted home in this part of town.
Other studios, like Capitol, Decca, and RCA Victor followed; and in 1957, RCA victor's Nashville division, headed by Chet Atkins, opened 'Studio B,' where Elvis Presley would record many of his most famous hits.
A few years later, in 1963, 'Studio A' was built next door. And between the two, the likes of Willie Nelson, Waylon Jennings, Dolly Parton, and many more recorded hit records.
With the studios came the musicians, the publishers, the lawyers and others, a clustering that created a music industry.
CAROLYN BRACKETT, National Trust for Historic Preservation: All of those are still here. And so you still have that sense of community.
CAROLYN BRACKETT: It's something that we have maybe taken for granted, because you can walk by these buildings or drive by a lot of them and not realize that this incredible music was made in that old house or in this small building.
And so a lot of the work that we have done in the last couple of years has been to document the history of Music Row all the way up to the present, what's happening here today.
SUMMARY: The abuse of opioids has become a major public health concern; more than 28,000 people died by overdose in 2014. According to reporting by STAT News, drug companies downplayed the addictive effects of opioid drugs in the late 1990s, assuring doctors that they could be safely used for chronic pain and incentivized their use. Hari Sreenivasan talks to journalist David Armstrong.
GWEN IFILL (NewsHour): The abuse of opioids remains a major public health concern around the country.
The federal government says more than 28,000 people died by overdose in 2014. That's the most recent year for nationwide data. The health news site STAT has been reporting on the problem and what has been driving it.
Journalist David Armstrong sat down with Hari Sreenivasan recently.
HARI SREENIVASAN (NewsHour): David, your investigation looks at a number of big pharmaceutical countries that you say helped sow the seeds for some of this epidemic that we have today. How so?
DAVID ARMSTRONG, STAT: Well, the way they sowed the seeds was by making this drug widely used.
And the way they did that was to downplay the addictive properties of this drug when marketing it to doctors, in a way that was later shown to be false and misleading.
HARI SREENIVASAN: Now, doctors can prescribe drugs off-label for something that it wasn't originally designed to, but how were the pharma companies abusing this?
DAVID ARMSTRONG: Well, they were primarily abusing it in the way they were assuring doctors that these powerful opioids that are a controlled substance would not be addictive in the way that they later proved to be addictive, and could be used for things like chronic pain, which we now know they're not very effective at.
So they were able to broaden the market through a series of misrepresentations and through a series of aggressive marketing tactics.
SUMMARY: Researchers have discovered documents showing that the sugar industry paid researchers to downplay the health risks of sugar and play up the risks of saturated fat in the 1960s. Gwen Ifill speaks with Marion Nestle of New York University about the revelations, the health impacts of consuming sugar and the complexities of studying nutrition.
GWEN IFILL (NewsHour): Now, how the sugar industry paid experts to downplay health risks.
Researchers have discovered documents showing the industry tried to influence scientific studies back in the 1960s. Early studies had found a link between sugar and fat and heart disease, but it now appears that the sugar industry paid two Harvard professors to point the finger elsewhere.
At the time, it wasn't routine to disclose such conflicts.
Marion Nestle wrote an editorial about the latest research in “JAMA,” “The Journal of the American Medical Association.” She's an author and professor of nutrition, food studies, and public health at New York University.
Welcome, Marion Nestle.
Let's start by a few…
MARION NESTLE, New York University: Well, glad to be here.
GWEN IFILL: Let's start with a few definitions.
What was the Sugar Research Foundation?
MARION NESTLE: Well, this was a trade association for the growers of sugarcane and sugar beets. It's now called the Sugar Association. So it's a trade group.
Its job is to promote the sales of sugar and to lobby to make sure that nobody does anything regulatory to reduce the consumption of sugar. It's a trade group.
GWEN IFILL: So, yes. So, when all the years when we were being told that fat and cholesterol were the prime culprits in obesity and early death and heart disease, it turns out that sugar also played a big role.
MARION NESTLE: Well, it did.
If you look at the epidemiology, at the time, it was clear that both sugar and fat were risk factors for coronary artery disease. But these investigators at Harvard who were paid by the Sugar Research Foundation kind of cherry-picked the data and minimized the problems with sugar and maximized the problems with saturated fat. And that was exactly what the Sugar Association wanted them to do, as the documents show.
GWEN IFILL: So, the goal here was to sway public opinion, in much the same way that the tobacco industry did?
MARION NESTLE:Yes, it followed the playbook of the tobacco industry.
The number one playbook rule is, the first thing you do is you attack the science, you cast doubt on the science. “Merchants of Doubt,” the book and the movie, explain all that. And the Sugar Association was doing exactly that.
It was trying to get researchers to produce research that would minimize a role for sugar and shift the blame elsewhere. And they were very frank about what they wanted, and the investigators agreed that was what they were going to do. Pretty shocking.
SUMMARY: After uncovering an illegal deal, the European Union ruled that Apple pay over $14.5 billion in back taxes to Ireland. The EU's antitrust regulator found that the country and the tech giant had made an agreement that allowed Apple to pay less than 1 percent in corporate tax for over a decade. Apple plans to appeal the decision. Hari Sreenivasan speaks with EU Commissioner Margrethe Vestager.
HARI SREENIVASAN (NewsHour):The European Commission ruled today that Ireland must collect $14.5 billion in back taxes from Apple. The announcement fueled new tensions between the U.S. and Europe over the role of multinational corporations, how they are taxed, and whether it should be considered a subsidy.
The antitrust regulator for the EU said Ireland had given Apple a sweetheart tax deal for well over a decade, with special laws that effectively allowed Apple to pay less than 1 percent corporate tax. The EU accused Apple of setting up two companies in Ireland with a head office that only exists on paper. The profits from European stores all go to the Ireland head office and are essentially untaxed.
Apple said it would appeal the decision and denied the characterization. In a statement, the company's chief executive, Tim Cook, said the European Commission is trying to — quote — “rewrite Apple's history in Europe, ignore Ireland's tax laws and upend the international tax system in the process.” The company has more than $200 billion in cash.
I spoke with Commissioner Margrethe Vestager, who announced the decision.
Ms. Vestager, thanks for joining us.
First off, what gave Apple an edge in Ireland that was unfair in the eyes of the EU?
MARGRETHE VESTAGER, European Commission:Well, we have a long longstanding prohibition of state aid, which means benefits, advantages to a selected company.
And that may come in any form, as a piece of land, a favorable loan, a grant or a tax benefit. And, of course, any member state can have their own tax legislation. We would never question that. But the thing is that you cannot give a specific company a benefit or an advantage which is not open to other companies.
HARI SREENIVASAN: Is there evidence that this was specific to Apple and not to all the other companies that are doing business in Ireland?
MARGRETHE VESTAGER: Yes, it is.
This arrangement is due to two things which are none of our concern, how Apple is organized and the Irish tax legislation. But the thing that is specific is two tax rulings — are two tax rulings that are directed specifically to Apple.
And tax rulings are, by nature, specific because they are directed from the government or from the authorities to a specific company. And this is only for them. It is not for other companies.
Due to an error by state officials, rent limits on tens of thousands of New York City apartments were improperly removed. Now, 20 years later, the state is relying on landlords to fix that problem. What could go wrong?
In February of 2015, Lilian Piedra received a letter with devastating news: Her landlord was jacking up the rent for her four-bedroom apartment in Manhattan’s Washington Heights from $2,100 a month to $3,500.
The notice did not say she faced eviction, but Piedra immediately understood that’s what it meant. She and her husband were already struggling to raise three young children on her salary as a bank customer service representative and his as a parking garage manager.
“As soon as I received that letter I was crying for a whole week. Every single day I was crying, even at work,” she recalled.
The prospect of much higher rent touched off months of sleepless nights for the Piedra family as they desperately searched for somewhere else to live. The only apartment she found nearby was half the size for about the same price. Her brother offered to let the family move into his house on Long Island, but Piedra knew that cramming nine people into a three-bedroom house was way too crowded.
“I saw myself living in a shelter,” Piedra said. She ultimately refused to pay the higher rent and, within days, the landlord moved to evict her.
But just before a June 2015 hearing on the family’s eviction, their lawyer made a startling discovery. Piedra was among tens of thousands of people who had been improperly excluded from a program that protects tenants from New York City’s exploding housing costs. Raising her rent 67 percent was, in fact, illegal. So was the resulting eviction. She ended up staying in her place for $2,100 a month.
Others have not been nearly as fortunate.
The law that protected Piedra — rent stabilization — was tied to a tax break a previous owner had received for renovating the building. Under a program created by a state law, owners benefiting from the taxpayer subsidy are obligated to limit annual rent increases to modest levels set by the city.
But due to a series of actions — and inactions — by a pivotal state regulator, the benefits of this program vanished for many New York City tenants.
Over two decades, owners of an estimated 50,000 apartments pocketed the tax break while charging market rents. Tenants who couldn’t pay were forced out, deepening a shortage of affordable housing which Mayor Bill de Blasio acknowledges is a “crisis.”
ProPublica has been examining what New York City gets for an estimated $1.6 billion in tax breaks it has granted to property owners and developers.
COMMENT: Way in my past, there was an article that the U.S. Patent Office was NOT computerized as were other government regulatory agencies. It implied that this was intentional since a paper system was very slow and other persons could file their patents BEFORE the first patent on something was approved. Thereby giving the sneak-thieves an legal out.
SUMMARY: The U.S. economy is driven by innovation, but unwelcome “patent trolls” are gunking up the system. Patent reform bills sit idle in Congress as the “trolls” set up companies for the sole purpose, critics say, of shaking down inventors while never creating anything. “We just have to write 'em a check so they'll go away,” says one disgusted app maker. Economics correspondent Paul Solman reports.
TODD MOORE, CEO, TMSOFT: So here's Amazon jungle.
PAUL SOLMAN (NewsHour): That's Todd Moore's 'White Noise' mobile phone app, which generates the call of the wild, and pretty much any other sound you can think of, to lull the sleep-challenged to la-la land.
And this is frogs?
TODD MOORE: Yes. Don't you just want to fall asleep?
PAUL SOLMAN: I'm getting slightly drowsy.
It was such a basic idea, Moore didn't even bother to apply for a patent. And yet he himself was sued for patent infringement.
TODD MOORE: They were claiming a hyperlink inside the white noise app, that you would tap it and go to the Internet, that was infringing on one or more of their patents.
PAUL SOLMAN: But doesn't almost every app have a hyperlink of some sort?
TODD MOORE: Yes. If you're using the Internet it does, so how can they say that's infringing on a patent?
PAUL SOLMAN: And all they were asking to go away, $3,500. Welcome to the world of so-called patent trolls.
NARRATOR:A patent troll is someone that makes their money by filing frivolous lawsuits against companies, with the hope that these companies will pay a fee to settle, rather than go to court.
aka Money before people or environment or Rape the Earth for more money.
Excerpt
SUMMARY: Minnesota’s Arrowhead region sits atop a trove of precious metals: four billion tons of raw material like copper and nickel, a haul worth $1 trillion, mining companies say. But local residents and activists are taking a stand against encroaching mining operations, citing the potentially disastrous environmental consequences. Josh Buettner of Iowa Public Television reports.
JOSH BUETTNER (PBS Iowa):Last fall, demonstrators pressured Minnesota’s Saint Louis County Board to publicly acknowledge a proposed copper-nickel sulfide mine would threaten the health of their local watershed.
WOMAN:It’s crazy to clean the river, only to allow it to be polluted again.
MAN: Mining is less than 1 percent of Minnesota’s economy.
JOSH BUETTNER:Opponents allege newly unearthed sulfur-bearing rock will create acid mine drainage, diluting previous efforts to restore the Saint Louis River, a waterway once crippled by iron ore pollution.
Since 2008, applications to conduct exploratory drilling have surged in the Land of 10,000 Lakes. And Toronto, Canada-based PolyMet Mining Corporation is first in line to unlock precious metals from the Duluth complex, a vast mineral deposit in the Arrowhead of Minnesota.
Mining proponents say geologists have known about the formation for over 60 years, but new technology will allow excavation of four billion tons of raw material worth an estimated $1 trillion.
LATISHA GIETZEN, PolyMet: It’s kind of a closed loop system.
JOSH BUETTNER: Latisha Gietzen, director of public affairs for PolyMet, says new mining techniques and rehabilitated infrastructure will mitigate past damages.
LATISHA GIETZEN: Because we’re using a Legacy site, we will actually be able to clean up some of the issues that are currently going on and bring modern technology to the process.
JOSH BUETTNER: Additionally, corporate officials say any water released from their proposed NorthMet site will be treated to meet state and federal guidelines.
But, for some, the mining industry’s track record is suspect. A well-established hub for agriculture, forestry and mining exports, the Port of Duluth sits between the contested estuary and Lake Superior. Ships from North America’s furthest inland port traditionally transported taconite, a mineral used to make steel, to mills around the Great Lakes Rust Belt and the world.
The finite resource is mined exclusively in the state’s Mesabi Iron Range. In the 1980s, two steel making facilities on the banks of the Saint Louis River became so polluted, they became qualified for EPA’s Superfund program.
With corporate- and taxpayer-funded cleanup continuing today, environmentalists such as Aaron Klemm fear relapse.
Hay... You Commie Pinkos, you don't understand, poor people are just lazy and want to be on the public dole. (satire off)
Cheap court fees and looser rules make suing over medical debts as small as $60 easy. Every year Nebraska collection agencies file lawsuits by the tens of thousands.
This story was co-published with The Daily Beast.
Two years ago, the president of Credit Management Services, a collection agency in Grand Island, Nebraska, presented a struggling local family with the keys to a used 2007 Mercury Grand Marquis. To commemorate the donation, the company held a ceremony that concluded outside its offices, where the couple and their two young girls could try out their new car.
The family's story was dire; their eight-year-old daughter's failing kidney had led to multiple surgeries and a deluge of medical bills, according to an article in the local newspaper.
But CMS played another role in the family's life, one the article didn't mention. The company had previously sued the couple eight times over unpaid medical bills and garnished both of their wages. As recently as two weeks earlier, CMS had seized $156, a quarter of the girl's father's paycheck.
Shortly after the ceremony, CMS released the family from further garnishment, court records show. But just four months later, the company filed a motion to start up again. The couple, who did not respond to attempts by ProPublica to contact them, has since declared bankruptcy.
In almost any other state, such a barrage of lawsuits against a family in desperate financial straits would be remarkable. Not in Nebraska. There, debt collectors frequently sue over medical debts as small as $60 and a simple missed doctor's bill can quickly land you in court.
Filing suit is one of the most aggressive ways to collect debt, but no one tracks how frequently it happens or to whom. An examination of Nebraska's courts, however, shows that where debtors live can have an enormous, and unexpected, impact on the quantity and types of lawsuits.
Nebraska's flood of suits isn't merely a reflection of residents' inability to pay their bills. About 79,000 debt collection lawsuits were filed in Nebraska courts in 2013 alone, according to a ProPublica analysis. In New Mexico, a state with a population, like Nebraska's, of around two million, about 30,000 suits were filed. Yet by virtually any measure, households in Nebraska are significantly better off than those in New Mexico: Income is higher. Poverty is lower. And fewer families fall behind on their bills.
The reason for the difference is simple. Suing someone in Nebraska is cheaper and easier.
The cost to file a lawsuit in Nebraska is $45. In New Mexico, where suits are filed at about one-third the rate as in Nebraska, the fee for smaller debts starts at $77.
Nebraska lawmakers, of course, didn't set out to turn the Cornhusker State into the Lawsuit State. Instead, it appears no one understood the consequences of having cheap court fees: Suing became an irresistible bargain for debt collectors. It's a deal collectors have fought to keep, opposing even the slightest increase.
For debtors, unaffordable debts turn into unaffordable garnishments, destroying already tight budgets and sending them into a loop. “It's just been a vicious cycle,” said Tanya Glasgow, a single mother in Lincoln, Nebraska who's been sued several times. “It's been horrible.”
“I resent the stereotype that these are not hard-working people” said Katherine Owen, managing attorney in Legal Aid of Nebraska's Omaha office. “Truly the majority of them simply cannot afford it. That's it.”
Lawsuits over medical debts are, of course, filed in other states, usually by hospitals. What makes Nebraska unusual is that almost all the suits are brought by locally owned collection agencies that pursue debts on behalf of medical providers. Although ProPublica found collection agencies filing suits in large numbers in other states, particularly Indiana and Washington, none could match the sheer volume in Nebraska.
It's a difference that came as a surprise to researchers, consumer advocates, and collection professionals both in and outside of Nebraska.
“There's very little information, period” on the number of collection lawsuits in different states, said April Kuehnhoff, an attorney with the National Consumer Law Center. Policymakers in Nebraska and other states should pay attention, she said. “Being sued on a debt has very serious negative consequences for consumers.”
In a statement, the Nebraska Collectors Association said collection agencies file suits as “a last resort,” after attempts by the original provider and the agency to resolve the debt have failed. “Cooperatively working with the consumer is always the preferred approach to the collection process,” it said.
Credit Management Services' offices are housed in a squat, brick building that's conveniently located just a block away from the county courthouse in Grand Island, a city of about 51,000 in central Nebraska.
Local businessman Michael Morledge has owned the company since 1995. His son serves as president and his daughter as vice president of customer relations. CMS, with about 200 employees, boasts of having “the industry's highest recovery rates” on its website and counts two-thirds of Nebraska hospitals among its clients. In addition to other medical clients like doctor's offices and clinics, CMS also handles non-medical debts such as overdrawn bank accounts, utility bills and payday loans.
Like other collection agencies in the state, CMS employs collectors to persuade debtors to make voluntary payments. And like those other agencies, CMS routinely sues those who don't. But it's here that CMS sets itself apart.
In 2013, CMS filed almost 30,000 lawsuits in Nebraska, more than the rest of the collection agencies in Nebraska combined. That would be a staggering number of suits in any state. In New Jersey, with a population nearly five times larger, only one company, the nation's largest debt buyer, filed more than 30,000 lawsuits that year.
To file those suits – about 120 per working day – CMS has its own staff of six attorneys. The complaints are prepped by support staff and then presented to the attorneys for review, CMS's general counsel Tessa Hermanson said in a 2012 deposition from a class action lawsuit against the company.
Debtors aren't sued unless “the individual has a means to pay,” she said. But when pressed about how CMS determines this, Hermanson, who supervises the company's lawyers, said she didn't know if it was done by “one person or a department.”
A review of CMS's lawsuits shows the company is routinely aggressive even when it's obvious the debtor is poor. In one case, CMS emptied a debtor's bank account 11 times over the course of two years, even though in all but three instances the debtor had under $100. One garnishment netted the company $6.50.
Competition for clients can encourage this sort of approach, said Judge Craig McDermott, former counsel at a CMS rival and current presiding judge of the Douglas County Court in Omaha. Companies may sue even when it's apparent the debtor can't pay just to prove to the original creditor that they are making an effort: “Otherwise they'll go to another agency down the street,” he told ProPublica in a 2014 interview.
CMS's frequent use of the courts has brought millions back to the company, which retains a percentage of what it collects, and its clients. From 2008 through 2014, CMS seized at least $88 million from Nebraskans' wages and bank accounts, according to court data analyzed by ProPublica.
In a brief response to a list of questions from ProPublica, CMS wrote that it “plays an active and important role in assisting creditors in Nebraska with recovering money owed for goods and services” and that it “strives to comply with all applicable laws and regulations” and only files suit after other collection attempts fail. The company declined to discuss any individual debtor case.
Earlier this year, state Sen. Adam Morfeld introduced a bill in the Nebraska legislature that seemed too benign for anyone to oppose: It proposed raising the fee for filing a lawsuit by $1. The extra money would go to civil legal aid organizations to provide more services to low-income residents.
But, to Morfeld's surprise, his bill quickly encountered stiff resistance. Tim Keigher, CMS's lobbyist in the state capital, made it clear the company would fight the bill every step of the way, said Morfeld, a Democrat. Keigher did not respond to requests for comment.
At a February judicial committee hearing, CMS's Hermanson appeared on behalf of the Nebraska Collectors Association to oppose the bill. Raising the cost of filing suit in county courts from $45 to $46, she said, would create a “burden” on the businesses that hire collection agencies. Collection agencies ask, “is it worth it to pay X amount to recover a small, you know, medical debt of $200?” she said. A higher filing fee may cause them to decide “it's just not worth it,” she said.
The gathered senators were skeptical. After Hermanson testified that collection agencies filed thousands of suits each month, one senator volunteered that maybe increasing the filing fee “would be better” if it meant fewer suits.
Sen. Matt Williams, a Republican and former president of the American Bankers Association, asked Hermanson, “So your testimony is that a one dollar increase in this fee that your client is going to pay, not you, would stop you from filing claims for $200, $300 medical bills?”
Hermanson, perhaps betraying an industry fear that opening the door to a dollar would ease the way for further hikes, said “There's always a need for increased funds and at some point it becomes less practical to continue to pay for those fees.”
“So you would weigh that one dollar against the ability to provide legal services for the poor people of Nebraska?” asked Williams.
“No, certainly not,” she replied.
“But that's what your testimony is.”
“My testimony is that the legal services fund, we're not disputing that it's needed,” said Hermanson, “just that maybe there's a better way to do it than increasing the court cost.”
Ultimately, CMS's efforts to halt the bill were unsuccessful. On a 40–0 vote, the bill passed the legislature earlier this month and was quickly signed by the governor. But Morfeld said, “It's really been eye-opening. I think we have a broader problem.”
ProPublica's review of court data across several states suggests a relationship between court costs and the number of collection suits filed.
In 2013, Cook County, Illinois, which contains Chicago and has a population of over 5 million, had about the same number of collection suits as Nebraska with its population of fewer than 2 million. That year, it cost $172 in Cook County to file suit for the sort of small amounts that predominate in Nebraska, where the fee was $45.
Not surprisingly, lawsuits over debts of a few hundred dollars are extremely rare in Cook County. The typical collection suit in 2013 sought around $3,000, according to ProPublica's analysis.
In fact, suits for a few hundred dollars are generally rare. Debt buyers, for instance, usually don't file suits for debts smaller than $1,000 due to the costs involved in suing, said Jan Stieger, executive director of the industry's trade group, DBA International. Debt buyers, which primarily purchase defaulted credit card accounts, file more collection suits nationwide than any other type of company.
Some states, like Missouri and New Jersey, have filing fees comparable to Nebraska's. But even there the rate of suits, when adjusted for the population, was still substantially lower.
Kuehnoff of the National Consumer Law Center said the volume of suits in a state is also a reflection of how easy it is to sue. Nebraska has a number of collector-friendly policies, such as looser standards for serving debtors with a lawsuit. Tougher standards – such as requiring collectors to serve defendants personally with a suit or provide more documentation of debts – can decrease the number of suits and make the process fairer to consumers, she said.
In February, a federal judge deemed CMS's practices unfair, siding with the plaintiffs in a class action lawsuit against the company. CMS, ruled U.S. District Judge Joseph Bataillon, had deceived consumers with its collection suits by wrongly claiming interest and attorney fees — charges that CMS adds to debts and keeps for itself. CMS agreed to settle the class action earlier this month, but the settlement's details remain under seal.
In his ruling, Bataillon wrote that the extra charges were just one part of a process that can be bewildering for defendants, who are very rarely represented by an attorney.
“Without any special knowledge of the law, a layperson could not figure out, on the face of the collection complaint, what the claim was for or to whom he or she was indebted,” he wrote.
To get a sense of who is affected by collection suits in Nebraska, ProPublica reviewed 100 randomly selected cases where a collection agency had garnished the debtor's pay or bank account. Most of the debtors were lower-income, more than half earned below a rate of $30,000 a year.
“I have to work two jobs just to try to make ends meet,” said Robin Kerr, 55, of Norfolk, a city of about 24,000 in northeastern Nebraska. Kerr has been sued four times, three times by CMS, and in each case, the agency sought to seize a chunk of her wages at Burger King.
Most of the suits we reviewed sought less than $700, and 40 sought less than $500. Four of the suits, all filed by CMS, were for under $100. In one case, a $66 chiropractic bill transformed into a $275 court judgment after court costs, attorney fees, and interest were tacked on.
The vast majority of suits were over unpaid medical bills, the providers ranged from rural hospitals to the largest in the state, from specialists to family doctors. Debts from multiple providers were often combined in the same suit, even bundled with non-medical bills.
The suits sometimes came quickly, in some cases only three months after the provider sent the patient a bill. That speed is in contrast to recent national reforms meant to protect consumers from being penalized for medical billing errors. Last year, the three main credit reporting agencies announced a new 180-day waiting period from the time a medical account is created until it can appear on a patient's credit report as in collections.
But in Nebraska, said legal aid attorneys, once an account is sent to a collection agency, the patient has little hope of sorting out a billing issue. Instead, collection agencies often give them the option of paying in full or facing a lawsuit, they said.
Tanya Glasgow, 39, has had health problems for years, at one point requiring surgery to remove her gall bladder and recently suffering from epileptic seizures. Making matters worse, she's gone for stretches without health insurance, which she's struggled to afford. She has two teenagers at home and a third child in college and works the graveyard shift at a nursing home for $18.50 an hour.
Glasgow's tried various strategies for dealing with her medical debt, which she estimates at about $20,000, but any plan can suddenly fall apart. “I'm paying on three of them and then the fourth one sues me,” she said. She's been sued five times, four by CMS.
The worst blow came last fall. CMS had filed its third suit, a bundle of radiology and emergency room bills, for over $1,000. A week after obtaining a judgment, CMS moved to garnish her pay. But the same day, CMS also filed to seize funds from her bank account.
The action froze Glasgow's account and secured the entirety of what she owed under the judgment, $1,315. But because it took several weeks for CMS to actually receive that money through the court, CMS allowed the garnishment of her wages to continue.
Glasgow said she struggled for two weeks to put food on the table. But when her paycheck arrived, it was short $226, because CMS had taken money she no longer owed. CMS garnished her next paycheck, too, before the case was finally closed.
Glasgow said she had to call both the court and CMS to get her money returned, and then CMS took more than a month to do so.
The experience convinced Glasgow it was time to pursue something she'd put off considering, bankruptcy.
It's a step that wouldn't be necessary if she lived in a state where lawsuits over medical debt weren't so common, she said.
“The amount of stress this has brought into my life has been almost unbearable.”
SUMMARY: Investment bank Goldman Sachs became this week the last big institution to settle with the federal government for its role in the 2008 financial crisis. But in an election cycle that has seen big banks under more scrutiny than ever before, there are worries that regulations against institutions like Goldman Sachs aren't going far enough. Lynn Stout of Cornell Law School joins John Yang.
JUDY WOODRUFF (NewsHour): Now to our occasional series of conversations about whether some banks and firms are too big to fail, and whether they pose a risk to the country's financial health.
John Yang has our latest installment.
JOHN YANG (NewsHour): Eight years after the housing bubble exploded, investment bank Goldman Sachs this week became the last big institution to settle with the government for its role in selling bundles of bad loans to investors, which led to the financial crisis.
In this election year, there is a lot of talk about whether too many firms remain too big to fail and whether the Dodd-Frank (Act) law is working.
Lynn Stout is a Cornell University law professor who now serves on the Treasury Department's Financial Research Advisory Committee. She has been very critical of Dodd-Frank, and she joins us now from Ithaca, New York.
Professor Stout, thanks for being with us.
Let's start off with that Goldman Sachs settlement this week. They have agreed to pay as much as $5 billion in this settlement with the government. What does this say about accountability now among the big financial institutions after the financial crisis?
LYNN STOUT, Cornell University: I'm afraid the settlement confirms something that we have suspected for quite a long time, which is that it looks like fraudulent practices were hard-baked into the banking sector during 2008.
And, unfortunately, although $5 billion sounds like a lot of money, the settlement is actually relatively small. It's certainly small compared to the damage that was done by these fraudulent practices, and it's relatively small compared to some of the settlements by some of the other banks, by Citibank and by Bank of America.
So, as large as the figure may seem, I'm afraid it creates the risk that this could be business as usual, that, at the end of the day, Goldman Sachs may have found these sorts of fraudulent practices to overall profitable, even in light of the fines.
JOHN YANG: Business as usual, you say.
Now, Dodd-Frank was supposed to address all this. It was the response to all of this, the financial crisis and what brought it on. You say Dodd-Frank isn't working. Why not? What about it isn't working?
LYNN STOUT: The basic problem with Dodd-Frank is that it created the appearance of Congress doing something, without that appearance being backed up by reality.
What the Dodd-Frank Act did mostly was direct various regulators at the Federal Reserve, the FTC, the CFTC to draft regulations that were supposed to rein in the banks. But Dodd-Frank itself doesn't impose many hard and fast rules, and what's happened in all the years since is that the financial industry, through lobbying, campaign contributions, behind-the-scene actions, HAS been very effective at stymying regulators from doing anything that really crimps their style and reins them in.
SUMMARY: Southern California's tranquil Coachella Valley has long been an environmental battleground. Home to 27 endangered and threatened species, the valley has also seen enormous population growth, with residents projected to double in the next 20 years. But a government plan 10 years in the making aims to balance conservationism with urban development. Special correspondent Cat Wise reports.
CAT WISE (NewsHour): The views from Chino Canyon high above Palm Springs are grand. The rocky hillsides are home to the endangered Peninsular bighorn sheep and a number of other species. But this tranquil canyon has long been an environmental battleground.
NICKIE MCLAUGHLIN, Friends of Palm Springs Mountains: If the project had been completed, you would have been looking at a 500-room hotel, a five-star resort, and all surrounded by an 18-hole golf course.
CAT WISE: Nickie McLaughlin heads up a local nonprofit that recently purchased 600 acres of privately owned land in the canyon to prevent that development.
NICKIE MCLAUGHLIN: There will be nothing here. It will be preserved as it is in perpetuity. This was a huge success.
CAT WISE: The push to save Chino Canyon is part of a much larger environmental conservation effort unfolding in Coachella Valley, a 45-mile stretch of desert dotted with upscale cities like Palm Springs, as well as areas of deep poverty.
The population here is expected to almost double in the next 20 years. Golf courses and condos butt up against fragile desert ecosystems.
TOM KIRK, Coachella Valley Association of Governments: In a lot of places throughout this country, we know that we have done development perhaps in a rash and vast way. In the Coachella Valley, we didn't want to do that.
CAT WISE: Tom Kirk heads up the local government agency now managing a plan that took more than 10 years to develop and that will be on the books 75 years into the future.
It's called the Coachella Valley Multiple Species Habitat Conservation Plan. Nearly 2,000-pages long, it is essentially a huge compromise between government agencies, private landowners and developers, scientists, and environmental groups.
In 2010, the New York City affiliate of Habitat for Humanity received a $21 million federal grant to work on a city neighborhood hit particularly hard by the foreclosure crisis and help stabilize it.
The funds would allow Habitat-NYC to launch the most ambitious project in its 32-year history. Its neighborhood pick was Bedford-Stuyvesant, a historically poor neighborhood in central Brooklyn, where the charity would focus on buying and renovating abandoned apartment buildings.
There was just one problem. With few vacancies in the gentrifying area, longtime tenants were pushed out of their apartments — some into homelessness — clearing the way for developers to sell to Habitat at a hefty profit, a ProPublica investigation has found.
Ultimately, Habitat's project came with a cost: While scores of families gained new homes, other even needier ones were displaced.
Though Habitat promoted the properties it acquired to renovate as “long-vacant,” four of nine were still occupied shortly before the charity moved to buy them, records show. In two cases, Habitat targeted buildings just days after the last families living there moved out.
The deals, and what local Habitat executives said about how they were being accomplished, left some inside the charity so upset that at least two employees emailed anonymous complaints to the nonprofit's international headquarters in Georgia.
“Habitat-NYC's Director [of] Real Estate and Construction speaks openly about making deals with developers, saying that we can not buy buildings from them until they get rid of all their tenants,” one of the employees wrote in a May 2012 email, which was provided to ProPublica. “We are spending federal money to throw low-income New Yorkers out of buildings.”
ProPublica's reconstruction of the events was based on hundreds of pages of internal Habitat emails and memos, as well as a review of public real estate records related to those buildings. ProPublica tracked down former tenants and used public complaints filed with the city's housing department as well as court records to establish the buildings' occupancy.
Between 2010 and 2011, at least seven Bed-Stuy families were pushed out of their rental apartments shortly before Habitat purchased them, ProPublica found. All had relied on federal housing subsidies or New York's rent regulation laws to afford their units. None were evicted in court. Three of the families ended up homeless.
Internal emails show that Habitat officials were willing to consider buildings even when they were aware that they hadn't been empty for long. “The Jefferson building I researched before is now vacant, and I am speaking with the owner,” Bill Bogdon, the director of real estate and construction, wrote to a colleague in 2011. “The challenge with this one is the recent occupancy.”
Overall, with privately raised funds heaped onto the $21 million grant, Habitat spent $43 million on the Bed-Stuy housing initiative.
Some $8.4 million went to buy six properties from developer Isaac Katz and limited liability corporations he represented. In 2006, New York's Attorney General sued Katz and his associates over a scheme in which they allegedly sold blighted buildings to dozens of minority homebuyers at artificially inflated prices. Katz settled his share of the suit for $750,000, admitting no wrongdoing.
“There's zero doubt in my mind that [Katz is] a bad guy and did bad things,” wrote then-Habitat-NYC Executive Director Josh Lockwood in a June 2011 email, responding to a colleague's inquiry. “Agreed its unlikely that an investigative reporter would target us specifically, but obviously we'd need to be prepared in the event s/he does.”
One day after Lockwood wrote the email, Habitat's Real Estate Investment Committee approved the purchase of three additional buildings from what they considered to be a group controlled by Katz for $6 million.
Katz's attorney said his client never had an ownership stake in the buildings, and was merely facilitating their sale to Habitat.
One of the buildings was the elegant, but rundown brownstone on Madison Street where Tashemia Tyson, a single mother of three, rented a third-floor apartment with public assistance. Around three months before Habitat began discussions to acquire the building, Tyson said Katz began pressuring her to leave.
Katz's attorney denied Tyson's allegations, saying that his client “never spoke to Tyson” and that all the units were vacant when he facilitated the sale to Habitat.
The apartment had no heat. “He told us that just as they were going to fix the boiler, the pipes burst,” Tyson said. Reluctant to move, she said she relied on her gas stove for heat and hauled water buckets up the stairs to cook and to bathe for more than a week.
Finally, in February 2011, she said she accepted an offer from Katz of six months' free rent at another building, but couldn't afford the new apartment once the regular rent kicked in. Today, she sleeps in a shelter in the Bronx.
Habitat said in a statement that “at no point were we aware that any tenant had been forcibly moved or incentivized to move out of their homes in properties we were intending to purchase. Moreover, we would condemn the use of any such tactics.” The charity added that they had retained outside legal counsel to investigate complaints made about their handling of the federal grant, but said the lawyers found no evidence of wrongdoing and that Habitat International concurred with their finding.
A spokesperson for Habitat International said “the anonymous hotline submitter… did not have documentation and their concerns were speculative.”
Bogdon called the allegations made against him in the whistleblower email “hearsay and erroneous.” He also said that the Jefferson building he had discussed with his colleague was never purchased.
Lockwood, who is now the CEO of the Red Cross's greater New York region, declined to comment.
Habitat acknowledged that they had struggled to find vacant properties in Bed-Stuy despite their extensive efforts and that “many of the [grant]-appropriate properties in that area were owned by Isaac Katz.”
Katz's lawyer denies that he owned many properties.
But Habitat said that they “undertook numerous steps to ensure that our actions adhered to all grant guidelines.” They said they had paid no more than the appraised value for each property and that Katz and other developers signed good-faith agreements affirming that no tenants had been improperly displaced.
“If we are able to determine that any former residents were affected by such tactics, we are willing to work with them to connect them to affordable housing resources,” Habitat said.
Paul Aloe, an attorney representing Katz, said “Mr. Katz was in no way involved in any harassment or removal of any tenants from the properties.” Later, he added, “Mr. Katz only got involved at all when the subject buildings were vacant.”
Karen Haycox, the CEO of Habitat-NYC, who joined the charity in 2015, long after the Bed-Stuy deals, said in statement, “we are proud that Habitat for Humanity-New York's participation in the [federal grant program] enabled our organization to help 105 families in need of affordable housing become homeowners.”
Four dozen of those families moved into new homes built on vacant land. Still, the majority of families helped by the project moved into units made available, in part, because others had been displaced
Many of those who bought Habitat's renovated homes earned around $50,000 a year — almost double the median income for renters in the neighborhood and about five times as much as the disability income of Charles Watson, a tenant who lived a floor below Tyson and ended up living on the streets after he was pushed out. Watson did not remember the name of the person who pushed him to leave.
“I didn't want to move,” Watson said. “They wanted everybody out because they knew they were going to sell and make the apartments into condos. And they knew that would be a lot of money. That's what it was all about, anyway: money.”
Josh Lockwood had a bold vision for Habitat-NYC when he was named its acting executive director in 2007
“In the face of New York City's crushing housing shortage, Habitat-NYC is adapting our volunteer building model to a large-scale project,” Lockwood was quoted saying in the charity's summer newsletter that year.
For most of its history, Habitat-NYC built only a handful of single-family homes annually. It was a model pioneered by Habitat International, the Christian charity that sprung to fame in the 1980s thanks in part to former President Jimmy Carter's close involvement.
Under Lockwood's leadership, the charity moved into large-scale construction, breaking ground on a 41-unit complex in the Brownsville neighborhood of Brooklyn. It was celebrated as the largest building project ever undertaken by a Habitat affiliate in the United States.
Lockwood was a rising star in the nonprofit world. In 2010, Crain's New York Business honored Lockwood as one of the city's “40 under 40.”
The federal grant was crucial in Lockwood's expansion plans. Now, Habitat would develop more than 100 units in one project. But taking the funds, part of the Obama administration's stimulus package, would require Habitat to modify another aspect of its building model.
In the past, Habitat acquired vacant lots and buildings from the city at nominal prices. With the federal grant money, Habitat would be going on the open market for the first time. The nonprofit also had to move forward on an accelerated timeline as it had agreed to spend half of the $21 million grant by the end of 2011, only a year and a half after receiving access to the money.
On the surface, it made sense that Habitat chose to work in Bed-Stuy. The neighborhood had the highest foreclosure rate of multifamily rental properties in the city, according to a report by New York University's Furman Center for Real Estate and Urban Policy, and Habitat had worked in the area.
The charity purchased nine apartment buildings to renovate in
Bedford-Stuyvesant with the help of federal dollars starting in 2010. (Map source: City of New York; Credit: Al Shaw/ProPublica)
But according to city data, the neighborhood had few vacancies. That's because tenants who live in old, multifamily buildings are usually protected from eviction. New York's rent regulation laws afford those tenants the right to renew their leases even in the case of foreclosure.
All seven families who moved shortly before Habitat bought their buildings lived in rent-regulated units.
“If I were looking for vacant buildings as a result of the foreclosure crisis Bed-Stuy would not have been the first place to look,” said Harold Shultz, a former deputy commissioner at the city's housing department.
The rules governing the grant did not set out how long a property had to be vacant to be eligible for acquisition, but federal officials did not want their money to entice developers to empty out buildings to score a sale.
During a web seminar with the federal department of Housing and Urban Development in June 2010, a Habitat-NYC employee asked, according to a transcript of the meeting, if it would be okay to make an offer on an occupied building where “the tenants were not all paying their rent and there might be some eviction proceedings going on.”
“I see that as a big problem,” an official replied. If Habitat were to buy that property, he explained, the federal funds would be linked to the eviction of tenants.
By the end of the month, Habitat began targeting several buildings for acquisition. They worked with a real estate broker named Jordan Bardach, who knew Isaac Katz. At the time, Katz was still paying off his settlement to the attorney general.
Bardach has operated several ventures under the name “Imagine.” One of them, Imagine Equities, advertises services on its website to help “remove tenants” in case of “future building renovations and upgrades.” Another, Imagine Living, lists on its website the buildings Habitat ultimately purchased. In 2013, he and Katz developed an app that “speeds up” the process for landlords to get tenants “paying rent again or evicted swiftly.”
Through a lawyer, Bardach said “Habitat reached out to me because of my general experience and asked for assistance in acquisitions.”
Three of the buildings Habitat acquired with Bardach's help were long vacant. But another, 849 Halsey St., still had three tenants shortly before Habitat targeted it for acquisition in late June, according to city housing records, and letters mailed to these tenants that were obtained by ProPublica.
Twana Midgette said she left the building in June 2010 after she found what looked like an eviction notice on her door. “Because of the conditions of the building, I didn't even put up a fight, and I didn't have anyone to contact,” Midgette said. She now lives in upstate New York, where she said she continues to pay rent with public assistance.
Melinda Ortiz remained as long as she could. “They said they wanted to gut the apartments. They even started working on the apartments downstairs,” she said. “They said that they weren't going to accept any more money.” Ortiz left shortly after Midgette and has spent the past few years moving from apartment to apartment.
David Coachman, a tenant who lived in a rent-stabilized unit, said he left on June 12, after accepting a $10,000 settlement. Four days later, a Habitat employee visited the property, HUD records show. “They wanted me out because they wanted the whole building empty,” he said. Today, Coachman lives with his son in Flatbush, Brooklyn.
On July 19, 2010, Katz signed a document that said he would notify Habitat if there had been tenants at 849 Halsey in the past three months and would “not order current occupant(s) to move, or fail to renew a lease, in order to sell the property to us as vacant.”
That was a little more than a month after the three tenants left.
Habitat declined to say whether Katz had told them about the tenants when he signed the document.
The tenants all said they had been pressured to leave, but do not remember the names of the people who spoke to them. Katz's attorney told ProPublica his client hadn't purchased the building until early July. “When Katz purchased the building, it was vacant,” he said.
If Habitat had independently tried to verify the occupancy history of the building, they might have found housing records that documented a call from Ortiz's apartment to register complaints of bedbugs, mold and a broken banister. The date of the call was June 1, 2010 — 15 days before a Habitat official first visited the property.
“I found all the units to be vacant,” the official wrote to HUD.
Katz's LLC closed on the sale of 849 Halsey to Habitat in late January 2011.
That month, Katz also sold a building at 203 Marion St. to the charity for about $620,000.
It was a remarkably quick and lucrative flip. Katz had purchased the six-unit property earlier that day for about $380,000 from Lena and Percy Spellman, an elderly African American couple who had owned it since 1983.
Internal Habitat documents provided to ProPublica show that Habitat first targeted the property for acquisition the previous June, when it was still owned by the Spellmans.
Katz's lawyer said this was “incorrect,” but did not elaborate.
Property records show that the Spellmans did not sign a contract agreeing to sell the property to Katz until July 30.
“I'm not very up to date on real estate law, but I don't know how you can sell something you don't own,” said Jerome Spellman, the son of the building's longtime owners. “And that's what he did.”
Habitat officials deny this was the case. In a statement, they said Katz already had a binding contract in hand when they first learned about the property. “There was no legal way Habitat-NYC could have directly purchased the property from the Spellmans,” they said.
Michael Kozek, a real estate lawyer, who reviewed the documents for ProPublica, said the Spellmans may have cause for complaint.
“The circumstances indicate something suspect,” he said. “It appears that the Spellmans were deprived of the full value of their property.”
I am Retired U.S. Navy (22yrs) and a Vietnam Veteran. After my Navy retirement I was in the computer related industry, now retired. In 2000 I was a registered Republican and voted for George W. Bush. Six months of having Bush in the Whitehouse forced me to re-evaluate my political stance. I had always thought of myself as a Moderate Republican, but was a Republican by "default" NOT because of close examination of the GOP. Due to what has happened in America since 2000, I now consider myself a progressive, and registered as a Non-Affiliated voter.
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