SUMMARY: Many states will be selecting an attorney general on Election Day. From time to time, these officials, who represent their states in legal proceedings, have acted as a check on federal policies. Christy McDonald of Detroit Public Television shares a look at a close race in Michigan, where Democratic candidate Dana Nessel is running against Republican candidate Tom Leonard.
SUMMARY: In the summer of 1967, the simmering unrest in cities across America exploded. In Detroit [riot], tensions between the police and the African-American community reached their limit, unleashing five days of full-out violence -- riots or a rebellion, depending on whom you ask. Fifty years later, special correspondent Soledad O'Brien reports on what sparked it all and the scars that remain today.
SUMMARY: President Trump wasn't expected to win in Michigan, but his supporters there aren't surprised that he took the state back in November. Now two months into the new administration -- and on the heels of a failed effort to repeal the Affordable Care Act -- how do pro-Trump voters assess his presidency so far? William Brangham reports.
SUMMARY: When it comes to luxury items, consumer minds are likely to think about some of the world's fashion meccas. Think Paris. Milan. New York. But Detroit? One growing company would like to think so. With its line of watches, bikes, bags and other items, Shinola (aka 'Shinola Detroit') is aiming to have the Motor City known for more than its cars and financial woes. Special correspondent Roben Farzad reports.
HARI SREENIVASAN (NewsHour): How a small company in Detroit is trying to bring more manufacturing of a different kind back to the Motor City.
In fact, the company is branding its products as built in Detroit. But what does that really mean?
Special correspondent Roben Farzad has the story, part of our series on business and economics, Making Sen$e, which airs Thursdays.
ROBEN FARZAD, special correspondent: Shinola's flagship store in Midtown Detroit showcases hand-made leather goods, bicycles constructed on site, and, of course, watches, the product that put this luxury brand on the map.
When you look at your marketing research for, say, a 40-something with some money to spend walks into a store, and aspires to buy a Shinola watch, what is that person buying?
JACQUES PANIS, President, Shinola: First and foremost, a high-quality time piece that has a story behind it
ROBEN FARZAD: President Jacques Panis says that story is about Detroit, a city that got hit especially hard by a financial crisis that saw Washington bailing out General Motors.
Adding insult, the NFL's Lions went winless, the city's mayor was indicted, and Detroit later filed for the biggest bankruptcy in municipal history. Even so, five years ago, Shinola set up shop here in a former GM lab.
JACQUES PANIS: It's a city that is going to be one of the great stories of our country. And, yes, it fell on hard times. And we at Shinola have come to this city and have been a small part of this revitalization.
ROBEN FARZAD: The company has created almost 400 jobs here, 240 in manufacturing. Mesha McCoy was laid off by a car parts maker in 2009.
This feels much less kind of what I imagine manufacturing to be. It's a clean room. We're wearing, you know, smocks and we're wearing things over our shoes.
SUMMARY: Flint, Michigan, earned a place in the spotlight again Thursday, as Congressional hearings on the city’s water crisis continued. Michigan Gov. Rick Snyder and EPA administrator Gina McCarthy both faced strict scrutiny for their apparent failure to respond to the dire situation quickly enough. John Yang reports.
MAN: Committee on Oversight and Government Reform will come to order.
JOHN YANG (NewsHour): Michigan Governor Rick Snyder and EPA Administrator Gina McCarthy took the oath, settled into their seats, and the grilling began.
Democratic Congressman Elijah Cummings started with Republican Snyder.
REP. ELIJAH CUMMINGS (D), Maryland: Governor Snyder has been described as running the state of Michigan like a business. There’s no doubt in my mind that, if a corporate CEO did what Governor Snyder’s administration has done, he would be hauled up on criminal charges.
JOHN YANG: An emergency manager appointed by Snyder’s administration switched Flint’s water supply to the Flint River in April 2014, in a bid to save money. But no corrosion control was added. That allowed lead from aging pipes to leach into drinking water for more than a year.
Snyder said today that Michigan’s Department of Environmental Quality repeatedly assured him the water was safe, until last fall.
GOV. RICK SNYDER (R), Michigan: It was on October 1, 2015, that I learned that our state experts were wrong. Flint’s water had dangerous levels of lead. On that date, I took immediate action. Not a day or night goes by that this tragedy doesn’t weigh on my mind, the questions I should have asked, the answers I should have demanded, how I could have prevented this.
JOHN YANG: That wasn’t nearly enough to satisfy some on the committee.
REP. MATT CARTWRIGHT (D), Pennsylvania: Plausible deniability only works when it’s plausible, and I’m not buying that you didn’t know about any of this until October 2015. You weren’t in a medically induced coma for a year. And I have had about enough of your false contrition and your phony apologies.
JOHN YANG: Republican Committee Chairman Jason Chaffetz laid blame mostly with the Environmental Protection Agency and its boss, Gina McCarthy.
SUMMARY: Detroit's public schools have been in financial decline for more than a decade as their enrollment plummeted. Now on the brink of insolvency, the district is confronted with decrepit buildings, a chronic lack of resources and fed up teachers who have staged "sick-outs" in protest of the conditions. The NewsHour’s April Brown reports.
JUDY WOODRUFF (NewsHour): Next, to Detroit, and a city school system in turmoil, plagued with decrepit buildings, financial uncertainty, a chronic lack of resources, and now a recent wave of teacher sick-outs.
All of it is fueling a growing anxiety that the system could run out of money in coming months.
April Brown has our report. It’s part of our Making the Grade series, which airs every Tuesday.
Tonight’s story is in partnership with the American Graduate Initiative.
APRIL BROWN (NewsHour): The playground at Detroit’s Spain Elementary and Middle School sat empty for weeks. No children were allowed in because of this.
LAKIA WILSON, Counselor, Spain Elementary-Middle School: We started to call it a steam geyser, because we really don’t know what it is, if you notice that there is steam coming out there. There is also some liquid that is spewing out from it. So it’s very dangerous because it causes the temperatures on the playground to reach 110 degrees.
APRIL BROWN: Lakia Wilson is the counselor at Spain, a school with a century-long legacy in this Detroit neighborhood. But for the last two years, she says, steam and water, reportedly from the sewer system, have been seeping out of the concrete in the parking lot and shooting out of this pipe a few feet away.
This is your only playground?
LAKIA WILSON: This is our own only playground. We have lost our gym, and we have no playground now.
APRIL BROWN: What do your kids do for exercise now?
LAKIA WILSON: Our children are limited to walking the hallway. They have become like mall walkers.
APRIL BROWN: The gym she referred to is now locked. But before that happened, a few cameras captured what is there.
How would you describe what we see inside?
LAKIA WILSON: A scary movie. The floor has been removed, the parquet. And now what you see is just a layer of blackness. We have been told that it was black mold. In fact, the city inspector said that it was mold.
APRIL BROWN: Teachers and staff say they have had building issues for years, including mold, water damage, and broken windows, some of which city inspectors recently cited as code violations.
India Brimberry, the school’s student health aide, is among those concerned these problems are affecting the health of those who work and study here.
SUMMARY: Detroit once seemed a city that stood on the threshold of unlimited possibilities. Washington Post and Detroit native David Maraniss examines that creative and booming metropolis of 50 years ago in his new book, "Once in a Great City." Maraniss joins Jeffrey Brown to discuss that golden era and the signs of troubled times to come.
JUDY WOODRUFF (NewsHour): Next, the latest addition to the NewsHour Bookshelf.
In the early 1960s, it was a city that stood on the threshold of unlimited possibilities, but it wasn’t to be. Today, some two years after Detroit declared bankruptcy, it is slowly recovering from decades of decline.
Washington Post editor and Detroit native David Maraniss looks at the Motor City of 50 years ago in his new book, “Once in a Great City: A Detroit Story.”
Jeffrey Brown talked to him recently at the National Book Festival here in Washington.
JEFFREY BROWN (NewsHour): So, “Once in a Great City,” you are taking us back to a great moment, right, maybe like the heights, right, of…
DAVID MARANISS, Author, “Once in a Great City: A Detroit Story”: Well, it’s a moment — the book takes place between 1962 and 1964, when Motown was booming, when the Mustang* was being conceived, when cars were selling more than ever before, when Walter Reuther and the labor movement were at their peak.
The working people of Detroit were reaching the middle class. There was so much luminescence about the city then, but it was a luminescence that was also a dying light.
JEFFREY BROWN: Well, before you get to the dying light, the luminescence, what was Detroit at that moment? Because it’s so easy to forget when you — given what we look at now.
DAVID MARANISS: It had 1.7 million people. Now it’s down to 700,000.
It had — the Big Three was building more cars than ever before. It had a creative spirit. The book — one of the threads of the book is creation, creativity, destruction, decay. And you see them sort of intertwined. And it was very creative at that point. You could invent yourself in Detroit 50 years ago.
JEFFREY BROWN: And, of course, Motown famously invented itself and then many wonderful and famous musicians.
DAVID MARANISS: Totally, yes, which is one of the key threads of the book, Berry Gordy and his family.
I give a lot of due to his sisters actually. The whole Gordy family created Motown. And all of this local talent, it’s just stunning to think about Smokey Robinson Stevie Wonder, The Temptations, the Supremes, Martha Reeves, Mary Wells. All these great musicians grew up near each other, and Aretha Franklin, who wasn’t Motown, but was there.
Researchers at Michigan State University have created a fully transparent solar concentrator, which could turn any window or sheet of glass (like your smartphone’s screen) into a photovoltaic solar cell. Unlike other “transparent” solar cells that we’ve reported on in the past, this one really is transparent, as you can see in the photos throughout this story. According to Richard Lunt, who led the research, the team are confident that the transparent solar panels can be efficiently deployed in a wide range of settings, from “tall buildings with lots of windows or any kind of mobile device that demands high aesthetic quality like a phone or e-reader.”
Scientifically, a transparent solar panel is something of an oxymoron. Solar cells, specifically the photovoltaic kind, make energy by absorbing photons (sunlight) and converting them into electrons (electricity). If a material is transparent, however, by definition it means that all of the light passes through the medium to strike the back of your eye. This is why previous transparent solar cells have actually only been partially transparent — and, to add insult to injury, they usually they cast a colorful shadow too.
To get around this limitation, the Michigan State researchers use a slightly different technique for gathering sunlight. Instead of trying to create a transparent photovoltaic cell (which is nigh impossible), they use a transparent luminescent solar concentrator (TLSC). The TLSC consists of organic salts that absorb specific non-visible wavelengths of ultraviolet and infrared light, which they then luminesce (glow) as another wavelength of infrared light (also non-visible). This emitted infrared light is guided to the edge of plastic, where thin strips of conventional photovoltaic solar cell convert it into electricity. [Research paper: DOI: 10.1002/adom.201400103 - "Near-Infrared Harvesting Transparent Luminescent Solar Concentrators"]
If you look closely, you can see a couple of black strips along the edges of plastic block. Otherwise, though, the active organic material — and thus the bulk of the solar panel — is highly transparent.
Michigan’s TLSC currently has an efficiency of around 1%, but they think 5% should be possible. Non-transparent luminescent concentrators (which bathe the room in colorful light) max out at around 7%. On their own these aren’t huge figures, but on a larger scale — every window in a house or office block — the numbers quickly add up. Likewise, while we’re probably not talking about a technology that can keep your smartphone or tablet running indefinitely, replacing your device’s display with a TLSC could net you a few more minutes or hours of usage on a single battery charge.
The researchers are confident that the technology can be scaled all the way from large industrial and commercial applications, down to consumer devices, while remaining “affordable.” So far, one of the larger barriers to large-scale adoption of solar power is the intrusive and ugly nature of solar panels — obviously, if we can produce large amounts of solar power from sheets of glass and plastic that look like normal sheets of glass and plastic, then that would be big.
A federal judge ruled Thursday that Michigan must recognize hundreds of same-sex marriages performed during a brief window last year.
U.S. District Judge Mark Goldsmith wrote that the unions are valid, but stayed the decision for 21 days pending any appeal by the state.
A different federal judge struck down the state's gay marriage ban on March 21. More than 300 same-sex couples in four counties got married the next day, before an appeals court suspended the decision and blocked additional marriages.
Michigan has refused to recognize those marriages, which affects health insurance and the ability of same-sex couples to jointly adopt children. Goldsmith said those who married "acquired a status that state officials may not ignore absent some compelling interest."
"In these circumstances, what the state has joined together, it may not put asunder," Goldsmith wrote.
State Attorney General Bill Schuette said in a statement that his office is reviewing the ruling, and added that "the sooner the United States Supreme Court makes a decision on this issue the better it will be for Michigan and America."
The U.S. Supreme Court could decide Friday whether it will put Michigan's same-sex marriage case on its calendar in time to be argued and decided by late June. Until now, the court has managed both to avoid settling the issue for the nation as a whole. In the meantime, there has been a dramatic increase in the number of states that allow same-sex couples to marry. Last week, Florida became the 36th state to issue licenses for same-sex unions.
The Michigan chapter of the American Civil Liberties Union, which filed a lawsuit on behalf of eight couples, said the ruling is "a victory for marriage equality."
JUDY WOODRUFF (NewsHour): Nearly 16 months after Detroit filed for bankruptcy, a federal judge approved an unprecedented and complex plan today that would bring the city out of bankruptcy and is designed to give it a fresh start.
The plan allows Detroit to shed $7 billion of debt, reinvest more than a billion dollars into neglected public service, cut pensions of general city retirees, and cut payments to bondholders.
Hari Sreenivasan has more on the story.
HARI SREENIVASAN (NewsHour): One crucial component of the plan that came together in the past few months is a so-called grand bargain. It allows the city to accept more than $800 million from nonprofit foundations, the state and others over two decades. That deal protects the city from selling a noted art collection at the Detroit Institute of Arts and reduces the size of pension cuts.
The Ford Foundation has donated the most money to the grand bargain, $125 million in all.
Its president, Darren Walker joins me now.
Thanks for being with us.
So, my first question is, what are nonprofit foundations doing in what seems like a bankruptcy bailout?
DARREN WALKER, Ford Foundation: Well, we’re not in the business of solving bankruptcies, but we do solve big problems and work with leaders at the city level and the community level, public and private sectors, to help solve community problems.
And this is one example of a group of foundations coming together at the behest of Judge Gerald Rosen to help solve this challenge.
HARI SREENIVASAN: So, is this a template for other cities that might be in financial straits?
DARREN WALKER: This is not a template for other cities, but there are many lessons here.
This was a complicated $20 billion bankruptcy with thousands of creditors and many contested issues. But our focus, which was on saving the Detroit Institute of the Arts and ameliorating the situation for the workers of the city, particularly those retirees under the pension fund, were — that was what we were able to help accomplish.
But this doesn’t mean that other cities are going to look to foundations to solve their bankruptcy issues. This is not a template for that.
JUDY WOODRUFF (NewsHour): Now: how Detroit is tackling a staggering amount of blight with some unusual help. The city is going through the largest municipal bankruptcy in U.S. history.
Earlier today, a judge ruled that Detroit is permitted to shut off water for residents if they don’t pay their bills. This comes as the city is under a great deal of pressure to turn around its larger deteriorating situation, including thousands of shuttered buildings.
Special correspondent Christy McDonald from Detroit Public Television has our story, as part of the Detroit Journalism Cooperative, funded by a grant from the Knight Foundation and the Renaissance Journalism Project of the Ford Foundation.
CHRISTY MCDONALD, Detroit Public Television: A demolition crew at work in Northwest Detroit. This one crew will knock down up to 10 houses in a day. Ronald Garrison lives next door to this one, vacant for years. Trespassers looted it of anything of value.
RONALD GARRISON: The man down the street boarded it up. And they used to come rip the boards off and still go back in there. And he would have to come board it up again.
CHRISTY MCDONALD: The numbers are in. There are nearly 80,000 dilapidated structures across the city of Detroit, a number so high because of scrappers, vandals tearing everything of value out of vacant properties, leaving them open to the elements. Once there is structural damage, the houses have to come down.
DERRICK WATTS: Oh yes.
The scrapping is so rampant, Derrick Watts says even inhabited homes can be targets.
DERRICK WATTS: You have to watch your house even if you go on vacation. You can go on vacation, and come back and your house will be scrapped. So you got to watch it, really, 24 hours a day, because that’s the thing now. That’s the hustle now.
CHRISTY MCDONALD: With the city bankrupt and operating under an emergency manager, Detroit’s new mayor, Michael Duggan, is focusing on the demolition of the tens of thousands of houses stripped beyond repair.
JUDY WOODRUFF (NewsHour): Nine months after it became the largest city in the U.S. to declare bankruptcy, Detroit is drawing closer to a deal on how to protect current and former city workers from deep pension cuts.
Until recently, officials had been warning of painfully large pension reductions. The shift was announced yesterday, and, today, leaders of the retired police and firefighters group voted in favor of it. Pensions for those retirees had faced a pension cut of up to 14 percent. Under the new deal, they wouldn’t take a cut. Other civilian workers faced a reduction that could have been as high as 34 percent. That’s been scaled back to 4.5 percent. Any action on pensions is being watched by other cities that confront huge debt.
And Christy McDonald of Detroit Public Television is here to fill in the picture.
Welcome back to the program.
Christy McDonald, am I right that there were these dire warnings up until just a day or so ago that pension cuts could be enormous?
CHRISTY MCDONALD, Detroit Public Television: Absolutely, Judy.
And that’s probably part of the negotiation process. You don’t come to the table first with your best deal. You have to start the negotiation. And those negotiations have been coming fast and furious ever since the city put its first plan of adjustment on the table about a month or so ago, which really is the road map of how Detroit is going to get itself out of bankruptcy.
And so there’s been a lot of back and forth, but there’s also been a lot of moving parts in different aspects to deal to try to offset those pension cuts. And it’s something called the grand bargain is what we’re calling it here in the city of Detroit.
What it is, is about $815 million that would help protect art at the DIA from being liquidated and sold to offset those pension cuts. Some of that money would come from foundations and also the Detroit Institute of Arts itself, but $350 million of that would also come from the state.
JUDY WOODRUFF: Now, what turned this around, because there was a serious concern that the retirees were going to take a big hit? What broke the dam?
CHRISTY MCDONALD: Well, when you take a look at this entire process, no one is going to be happy at the end of a bankruptcy process. No one is really going to win.
You know that the banks are going to take a severe haircut, but really the most vulnerable people of all in this entire process are those retirees, the people who worked for the city of Detroit and were promised a pension at the end of it, and it was actually protected by the state constitution.
Well, the bankruptcy judge said in the beginning — this is federal bankruptcy court — those pensions are going to be allowed to be touched. So, everyone knew and was looking at this pension issues and the retirees, knowing that some sort of special protection would have to come towards them. And so I think that you have people working at the state level.
Americans for Prosperity’s latest anecdotal TV ad attacking the Affordable Care Act features a Michigan mom who says her family’s “new plan is not affordable at all” and that the law is “destroying the middle class.” In fact, her case is an example of how middle-class families can benefit from the law — if they choose to do so.
The ad, which features Shannon Wendt of Michigan, leaves the false impression that the family obtained its costly new insurance plan through the federal exchange set up by the new law. But that’s not the case. The family’s “new plan” is a temporary plan that does not meet the ACA requirements. Blue Cross Blue Shield of Michigan offered the plan to customers who had their old policies canceled but did not want to purchase insurance on the exchange. It turns out that Wendt found a cheaper, subsidized plan on the exchange, but declined to accept it because she did not want her children on the Children’s Health Insurance Program.
That’s her right, of course, but the ad is misleading because it fails to disclose that the Wendt family opted to pay more for insurance rather than accept the conditions that came with obtaining a cheaper, subsidized health plan on the exchange.
Meet the Wendt Family
The ad, called “Shannon’s Story,” is the latest in a series of anti-ACA ads by Americans for Prosperity, a conservative group founded by billionaire businessman David Koch. In it, Shannon Wendt — the married mom of five young children — criticizes the health care law and Rep. Gary Peters, a Michigan Democrat who voted for it. Peters is the likely Democratic nominee for the U.S. Senate and is expected to face Republican Terri Lynn Land in November for retiring Democratic Sen. Carl Levin’s seat. AFP has spent $5 million so far in Michigan — a key state if the Republicans hope to win control of the Senate.
Shannon Wendt, and her husband, Zach, are Republicans. They were elected precinct delegates for Tallmadge Township, a section of Grand Rapids, Mich., in Ottawa County, in the August 2012 primary. She sells Etsy products and operates a website called Organic Mama’s Shop. He is a real estate agent. Neither has insurance through an employer. As she explained in prior interviews, she had a Blue Cross Blue Shield of Michigan plan that she obtained on the individual market, but it was canceled because it did not meet the requirements of the Affordable Care Act.
In the ad, which began airing March 25, Wendt says her “new plan is not affordable at all.” She is shown with her five children, ages 3 to 10, and husband, Zach, who she said is “working a lot more hours” to pay for the insurance increases. But left out of the ad is why the new plan costs more and the family’s personal decision to opt for a more expensive plan.
Shannon Wendt told Fox Business in an article published Jan. 7 that she and her husband were eligible to buy a subsidized health insurance plan, but she said she was surprised and frustrated to learn that her family would be eligible for subsides on the exchange only if they enrolled their children in the Children’s Health Insurance Program. CHIP, as it is known, is a joint federal-state health care program that provides insurance at little or no cost for children of moderate-income families who are not eligible for Medicaid.
Fox News, Jan. 7: She found that because she and her husband are small-business owners — Zach is a real estate agent — and they take certain business deductions, they fall right under 200% of the federal poverty line. This makes them subsidy eligible, and their children Children’s Health Insurance Program (CHIP) eligible.
“If we want our children on our family plan — whether its two or 10 people — we lose the subsidy,” Wendt says. “It’s amazing that they are forcing families onto government health-care. It almost feels like an attack on small business owners. This revelation is more frustrating than the initial glitch.”
Wendt is right. As HealthCare.gov explains, a family cannot receive subsidies to help buy insurance on the exchange if the children in the family are CHIP-eligible and they do not sign up. But if the children do go on CHIP, then other members of the family, i.e., the parents, may be eligible for subsidized insurance on the exchange — which would have been the case with the Wendt family.
Since the Wendt family’s adjusted household income falls “right under 200% of the federal poverty line,” as Fox wrote, then that means the couple has a modified adjusted gross income of no more than $72,060, based on the 2014 federal poverty guidelines for a family of seven. That also means their children are eligible for the Children’s Health Insurance Program in Michigan, as Wendt said, since families earning up to 200 percent of the federal poverty level are eligible for Michigan CHIP.
Shannon Wendt has her reasons for not wanting her children to be on CHIP — reasons she explained in a March 31 op-ed she wrote for the Washington Times. In it, she acknowledges she and her husband “would be eligible” for subsidies and “would be paying less” for insurance but do not feel CHIP would provide adequate health care coverage for their children.
Wendt, Washington Times op-ed, March 31: What about the subsidies? My husband and I would be eligible, but only if we put our children on MIChild, a taxpayer-funded state health insurance program run through Medicaid. My husband and I would be paying less, but we’d also have to leave the family doctor I’ve been with since I was 6 years old.
That’s a path we would never take. We’d be sacrificing our children’s health for the sake of our wallets.
She goes on to say that her children were briefly on the Michigan CHIP plan several years ago and had a bad experience with one of the doctors who “failed to give my daughter the right immunizations.”
The 30-year-old mom has every right, as we said, to make that decision. We don’t take issue with Wendt’s decision, but rather her assertion that the Affordable Care Act is “destroying the middle class,” when other families faced with the same choices may have made a different decision that could save them thousands of dollars a year.
Let’s consider what would happen if a family with a similar profile to the Wendts decided to enroll their kids in CHIP and accept the federal subsidies for an exchange plan.
Subsidized Insurance Plans
We took the information publicly known about the Wendt family and plugged the values into the Kaiser Family Foundation subsidy calculator and the HealthCare.gov website to obtain subsidy and premium estimates for a family that fits the Wendt profile.
On the KFF site, we provided this information: state (Michigan), zip code (49534), county (Ottawa), adjusted annual household income ($69,000, which is 194 percent of the FPL), employer coverage (none), number of people in family (7), number of adults enrolling in the exchange (2), ages (30 and 34), tobacco use (no), number of children enrolling in the exchange (none).
We don’t know the Wendts’ exact adjusted household income, but $69,000 is “right under” 200 percent of FPL. We also don’t know if either smokes, but for this exercise we assumed the couple does not.
KFF says children in the household might be eligible for CHIP depending on the state (actually the Wendt children would be eligible for CHIP in Michigan, as we know) and the adults would be eligible for subsidized insurance on the exchange.
There are two kinds of subsidies available to those who purchase insurance on the exchange: an advanced premium tax credit, which is used to lower premiums; and the cost-sharing reduction, which lowers out-of-pocket expenses for people who purchase a silver plan. (There are four levels of plans available for people 30 and over, from cheapest to most expensive: bronze, silver, gold and platinum. Silver covers 70 percent of health care costs.)
The KFF subsidy calculator said a Michigan family of seven with an adjusted income of $69,000 could expect to receive $121.75 per month in premium tax credits. KFF said the couple could purchase, with subsidies, a bronze plan for $220 per month and a silver plan for $345.75 per month — plus the couple’s out-of-pocket maximum would be limited to no more than $4,500 if they go with the silver plan. KFF did not provide information on the family’s annual deductible, which would depend on what kind of silver plan the family chooses.
We went to HealthCare.gov to get more specific information about the plans that are available to such a family. Again, we plugged in all the same values: a family of seven in Ottawa County, Mich., with an adjusted household income of $69,000, seeking coverage for two adults ages 30 and 34. HealthCare.gov says that the two adults are eligible for a $121 per month tax credit — the same amount KFF gave — and a reduced out-of-pocket maximum (OOPM) for the silver plans.
HealthCare.gov also says there are 33 plans offered by three insurance companies in Ottawa County: eight bronze, 14 silver and 11 gold. Bronze plans cover 60 percent of health care costs, silver 70 percent and gold 80 percent.
A sample of the exchange plans, including subsidies, that were listed on HealthCare.gov for a family that fits the Wendt profile:
- Blue Cross Select Bronze HMO, $221 per month/$11,900 deductible/$12,700 OOPM per family
- Blue Cross Premier Bronze PPO, $292 per month/$12,700 deductible/$12,700 OOPM per family
- Blue Cross Silver Select HMO, $322 per month/$900 deductible/$2,900 OOPM per family
- Blue Cross Premier Silver PPO, $421 per month/$600 deductible/$2,800 OOPM per family
- Blue Cross Select Gold HMO, $454 per month/$500 deductible/$10,200 OOPM per family
- Blue Cross Premier Gold PPO, $534 per month/$300 deductible/$10,200 OOPM per family
In her op-ed in the Washington Times, Wendt said that last year she paid $221 per month for coverage that included a family deductible of $5,000, 20 percent coinsurance, and a $10,000 out-of-pocket maximum. This year, she has a policy that costs $381 per month, with a $10,000 deductible, 30 percent coinsurance, and a $17,000 out-of pocket maximum. That’s a premium increase of $160 per month ($1,920 per year) for a policy that has a higher deductible and out-of-pocket maximum.
Based on the Kaiser Family Foundation and HealthCare.gov results, a Michigan family of seven with the same profile could get a silver plan with the same coinsurance as the Wendt’s current plan, a monthly premium that would be roughly the same (somewhat less for the HMO and somewhat more for the PPO) and far less than the $10,000 annual deductible. Plus, such a family would be eligible for subsidies to reduce out-of-pocket expenses to around $3,000 — which could represent a significant savings since Shannon Wendt told MLive.com, a Michigan news website, that her family paid $10,000 in out-of-pocket expenses last year.
Of course, the silver plan also provides more benefits because it provides “essential benefits” and meets other requirements that Wendt’s old and current plan do not meet.
In explaining her frustration with the new law, Shannon Wendt told Fox News that she was happy with her old plan because the family prefers paying low monthly premiums and high deductibles. “We feel it makes financial sense for us to have a higher deductible plan and just pay these little things out of pocket and then the money we’ve been able to save every month on our premium we’ve been putting away for years and years in the event that something comes up where we would need our deductible, where we would have significant medical needs,” she said.
In that case, the HealthCare.gov website shows that a family fitting the Wendt profile could get a bronze plan, which covers only 60 percent of health care costs. A bronze plan would have a low monthly premium ($221 for the HMO and $292 for the PPO) but a high deductible ($11,900 for the HMO and $12,700 for the PPO).
Either way, the bronze or silver plans would provide better benefits at less cost than the plan Shannon Wendt currently has.
Blue Cross and Rate Shock
There’s one other thing that we know about Wendt’s insurance coverage that is important. She was covered by Blue Cross Blue Shield of Michigan — the state’s largest writer of individual health plans — and the insurer caused a stir in the market when it canceled all of its non-compliant plans except one called “Keep Fit.” That plan was grandfathered in because, the company said in a November 2013 press release, it was “the only plan in Blue Cross’ individual portfolio to have a 2013 ‘plan year.’ ”
When Obama, the Michigan governor and state insurance commissioner all said that insurance companies could re-issue non-compliant plans, Blue Cross declined to do so — in part because it said it hadn’t raised premiums in the individual market since 2011 in anticipation of phasing them out. The company said in the November press release that to extend all of its non-compliant individual plans would result in a “rate shock.” The company said, “Keeping the plans open in 2014 would require a ‘catch-up’ premium rate increase of 30 percent or more.” They did allow people like the Wendts to transition into the “Keep Fit” plan – but only through 2014.
This is what Wendt means when she writes in her op-ed that she now has “a ‘grandfathered’ plan that will be canceled at the end of 2014.”
Despite the company’s stated desire to prevent “rate shock,” Blue Cross members complained that that is exactly what happened. Wendt wasn’t the only one complaining about high rates. A Detroit Free Press story told a similar story about the Mulder family in Wixom, Mich.
Detroit Free Press, Nov. 15, 2013: The Mulder family in Wixom, for instance, received notice last month that their bare-bones Blue Cross Blue Shield of Michigan policy — costing $291 a month and carrying a $5,000 deductible — would end Dec. 31. Given the choice of it and his other options — one with a $930 monthly premium and another with a cheaper premium but a $17,000 annual deductible. Josh Mulder said he’d rather continue his current policy.
Tiffany Jones, a spokeswoman for BCBSM, told us in an email that 140,000 of its members moved from the canceled plans to either the non-compliant Keep Fit plans or ACA-compliant exchange plans. She could not provide us with the average rate change — increase or decrease — for those who selected Keep Fit or for those who went on the exchange. In November, BCBSM spokesman Andy Hertzel told Crain’s Detroit Business that about 50 percent of its customers who had non-compliant individual policies were eligible for subsidies.
“Many people could receive better benefits at lower prices” on HealthCare.gov, Hertzel told Crain’s.
Shannon and Zach Wendt could have been among those people if they went on the exchange — but they decided against it.
JUDY WOODRUFF (Newshour): Finally: the choices ahead as Detroit moves forward with bankruptcy.
Today's ruling by a federal judge begins to clear the way for it to happen, and he said public pensions could be cut as part of other changes aimed at shedding billions in debt. Unions and pension funds had argued that Michigan's state Constitution protected those pensions.
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CHRISTY MCDONALD, Detroit Public Television: It was.
But, Judy, he had to answer several legal questions before he could clear the way for Detroit's eligibility for Chapter 9. One of those is, is the city insolvent? And the judge found, yes, the city is insolvent. It can't pay its debts. And no one really argued that point there. There is an $18 billion debt.
The other question he had to answer was, did the city negotiate in good faith with its creditors before they even filed for bankruptcy? And while he chastised the city and said, you know what, the city really didn't negotiate in good faith, he moved to the next legal question was, did the city -- was it even possible for them to negotiate?
And he said it really wasn't, given the fact they had 100,000 creditors and an $18 billion debt. And then the other question he had to answer was, was it constitutional to file for bankruptcy? And, indeed, he said, yes, it was.
And, interestingly enough, the judge said that Detroit should have and could have filed for bankruptcy even years ago, given the financial situation it is in.
SUMMARY: Michigan Gov. Rick Snyder took the stand in bankruptcy court to testify about the decision-making process the city went through before filing in order to prove that Detroit is insolvent. Jeffrey Brown gets an update on the city's struggle to right its teetering finances from Christy McDonald of Detroit Public Television.
SUMMARY: The city of Detroit filed for bankruptcy in July, and now it must prove to a judge that the conditions necessitate that protection. But some pension funds, unions and retirees are fighting the filing. Jeffrey Brown gets an update from Matthew Dolan of The Wall Street Journal on Detroit's finances.
HARI SREENIVASAN (Newshour): Next: a pair of dispatches from Detroit at an important moment, starting with a key trial over the city's bankruptcy filing. Detroit's leaders say the city is $18 billion in debt, forcing a move to Chapter 9. But they also must persuade a judge the city has met all of the requirements to do so. And opponents say that's not the case.
Jeffrey Brown has more.
SUMMARY: Detroit residents are hoping to breath new life into their communities, despite the city's filing for bankruptcy earlier this year. Neighborhoods are working to attract developers to rehab blighted buildings, create new jobs and assist would-be buyers and renters. Jeffrey Brown reports on the optimism driving their efforts.
JUDY WOODRUFF (Newshour): In July, Detroit became the largest American city ever to file for bankruptcy. That process continues to unfold, and much of the news since has been grim.
But, as Jeffrey Brown found recently, there's another side to the story of this troubled city.
SUMMARY: The Supreme Court heard arguments on whether Michigan voters can pass a law that prohibits racial preference in college admissions. Gwen Ifill gets background from Marcia Coyle of the National Law Journal, plus views from Lee Bollinger of Columbia University and Joshua Thompson, an attorney with the Pacific Legal Foundation.
GWEN IFILL (Newshour): The debate over affirmative action returned to the Supreme Court today, this time in the form of a challenge to a Michigan law that would ban its use at public universities.
We begin our coverage with NewsHour regular Marcia Coyle of The National Law Journal, who of course was in the courtroom today, as always, Marcia.
Two months after Detroit became the largest city ever to file for bankruptcy, top Obama administration officials will be there on Friday to propose nearly $300 million in combined federal and private aid toward a Motown comeback — only a fraction of the billions the city owes and a reflection of the budget and political limits on President Obama.
This first major infusion from the federal government, which administration officials say will not be the last, would be used to help clear and redevelop blighted properties, improve transportation systems, bolster the police — especially around schools — and overhaul city management systems wrecked by years of poor administration and inadequate resources.
The package follows weeks of meetings in Detroit and at the White House between the administration team and local business, labor and philanthropic leaders on how best to pool existing resources. Final details are to be worked out in a two-hour meeting of the federal and local officials at Wayne State University, participants said.
While Mr. Obama remains in Washington as fights over the budget and health care threaten a government shutdown at the start of a fiscal year on Tuesday, he is sending a delegation led by his chief White House economic adviser, Gene B. Sperling, which includes three cabinet members: Attorney General Eric H. Holder Jr.; Shaun Donovan, secretary of housing and urban development; and Anthony R. Foxx, secretary of transportation and a former mayor of Charlotte, N.C.
Administration officials acknowledged that the initial aid would hardly solve problems in Detroit that have been decades in the making. But, Mr. Sperling said, “It’s the largest city bankruptcy in the history of our country, on our watch, and we’ve got to do something.”
Yet the idea of the federal government’s responsibility toward Detroit is hardly a settled issue in Washington. Instead, divisions over the question reflect the fundamental divide between the two parties over the size and role of government.
Congress, preoccupied with reducing federal deficits, has been all but silent about helping the birthplace of the auto industry and, some say, of the American middle class. The Republican-controlled House is hostile to any spending initiatives from Mr. Obama. In the Senate, two Southern Republicans separately and unsuccessfully proposed legislation intended to ban bailouts — Detroit leaders have not sought one — briefly churning the racial currents at play over a city where four out of five residents are black.
So with the chances that Congress would pass any legislation for Detroit “somewhere between zero and zero,” as an administration official put it, Mr. Obama has fallen back on what he can do through executive actions, with available money and tax credits, or through partnerships with local businesses and foundations.
The effort is similar to the way he has worked around Congress to create advanced manufacturing centers nationwide with federal and local support, provide broadband in every classroom, speed up infrastructure projects and try to reduce gun violence.
