"Why, exactly, are the bills this high?"
It was this seven-word question that took journalist Steven Brill on a two-year reporting trip through the American health-care system — trying to understand why in the United States we pay significantly higher prices for medicine than any other country in the world.
Brill's reporting first produced a 26,000-word cover story for Time magazine — the longest piece in the publication's history. And earlier this month, he published a book-length version of the article, America's Bitter Pill: Money, Politics, Backroom Deals, and the Fight to Fix Our Broken Healthcare System. The book does two things. It takes a deep dive into the Obama administration's disastrous Healthcare.gov launch. It also critiques the Affordable Care Act itself, arguing that the law did nothing to control health-care costs, instead focusing solely on expanding coverage.
Brill and I spoke last month about those and other subjects. Here's a transcript of our interview, edited and condensed for clarity and length.
How to write a book
Sarah Kliff: You have written books on really different subjects, ranging from education reform to Obamacare. Talk a little bit about your process. How do you decide what to write books on? Once you've decided, where does the writing process go from there?
Steven Brill: I've written books mostly about stuff that I'm really curious about. The first book I did was about the Teamsters Union when I was pretty much just a child. The one pattern really is I tend to write about stuff that I don't know anything about.
That is probably a terrible admission, but what I mean is I start out not knowing anything about the subject. Now in the case of this book I knew quite a bit about it because of the Time article. When I started doing the Time article I knew nothing about the health-care industry. I just was curious about why it's so expensive.
If it's a subject that you really care about and that you're really intensely curious about, it works
The first thing I teach my journalism students when I teach at Yale in the fall is the best stories really come from what you're curious about. If you can convey your curiosity to the reader and then take the reader on a journey where about you satisfy that curiosity, then you usually have a pretty good story. If it's something that you're not really curious about, it does really not work because you're not going to try to find the answers.
That leads to the next thing I tell my students all the time. This is usually the first day of class. They've gotten into this exclusive seminar at Yale, and I say, "I have really bad news for you guys. When it comes to journalism, being smart is not nearly as important as being willing to work hard." What I mean by that is I would much rather have someone who's willing to interview 100 people instead of someone with a higher IQ.
I just love the idea that, if there's a room full of 100 cartons with depositions in them and that's part of my story, I love knowing I'm the only one who's going to get up early enough in the morning and read all 100 cartons. I can't control how smart I am, but I can control how hard I work.
Sarah Kliff: This is one of the things I really liked about your Time story: you took this issue in the health-care system — that its really expensive — that all of us beat reporters just accepted as a fact, and you really dug into it.
Steven Brill: Well, it's fun. I think about when I was going to law school, litigators would say the great thing about litigation is you drop in on some subject for six months, and immerse yourself into it. I liked that idea, though I didn't like the idea of doing it in the context of litigation.
It is the same thing here. If it's a subject that you really care about and that you're really intensely curious about, it works. if it's not, then it's not going to work. I find that in the various news organizations I've run, I've actually tried not to have people be beat reporters for too long because they get so used to the subject.
Healthcare.gov's disastrous launch
Sarah Kliff: One of the things I've never fully understood in my reporting on the healthcare.gov launch — and one thing your book goes into a lot — was how much or little the White House knew about how badly things would go.
When the White House was having reporters in for briefings in September 2013, right before the launch, they would brush off any concerns about technology. I never knew if they knew how bad it would be, and didn't tell us, or if they were really were in the dark. Your reporting seems to suggest the latter: things were so siloed that the White House just didn't know.
Steven Brill: Yeah, I definitely remember that time period. You [and Ezra Klein] did that story in the Post which was a great story. But the headline and the drama was all about, "Is anybody going to sign up?" It wasn't about the technology. The great epitome of that was [White House Chief of Staff Denis] McDonough calling people the night before saying, "We're going to knock your socks off." I know he believed it.
I'm actually thinking of something the president said, that's not quoted in the book. At one of his press statements or conferences right after the disastrous launch he said, "Do you think I would have launched this thing or said it was going to be great if I knew that this was going to happen?" I mean that just seems totally true.
Sarah Kliff: What's your take on how that happened? How did the White House and the president end up so out of the loop on such a major issue?
Steven Brill: The most reasonable explanations I've gotten are from the people who sort of knew that it wasn't going to work, like Bryan [Sivak, Chief Technology Officer at the Department of Health and Human Services]. He told me, "Well, I sort of knew in my gut it wasn't going to work, but things seemed to have always worked out for [Obama] and maybe we'll have some glitches, but maybe not that many people would show up so we'd be able to fix them."
"Do you think I would have launched this thing ... if I knew that this was going to happen?"
There it was all wishful thinking for the people who should have known and spoken up.
Sarah Kliff: Did the press corps screw up here? I look back at my own reporting and think, "Gosh, we really missed a giant story." We were all blindsided by the terrible launch, and so much more focused on the enrollment stuff. And I honestly feel bad about it.
Steven Brill: The interesting thing is the only place you might have gotten a clue — because it's not like they were opening up the CMS [Center for Medicare and Medicaid Services] tech people to you — was from the the insurance companies. They were terrified. They kept saying, "This just is not going to work, it's not going to work."
There is a scene in the book where [CMS officials] tell people at the White House and [senior White House health policy advisor] Jeanne Lambrew's explanation is, "Well, the insurance companies are always complaining about something."
Fixing American health care
Sarah Kliff: At the end of the book, you outline your vision for fixing American health care: having really big hospital systems and eliminating health insurers, essentially cutting out the middle man. It mirrors Obamacare's Accountable Care Organizations, which do this on a smaller scale in Medicare. Are those in the same spirit of what you're talking about in your book?
Steven Brill: The thing that I was talking about was hospital systems like the Cleveland Clinic. You allow hospital systems to get really big, but you take advantage of it because it gives you a justification and legal ability to regulate heavily. You say, okay, now you're now like a public utility. We can take a really good look at your prices and your profits and because you have a tax exemption we have the legal authority to deal with the kind of salaries you pay people.
Sarah Kliff: Is this something the Obama administration has the legal authority to do right now if it wanted to?
Steven Brill: Yes. I don't think you'd have to pass a single law. You just need to have a different outlook at the Federal Trade Commission [which oversees hospital monopolies and enforces anti-trust law].
But even more significantly you could do it in New York or Ohio or Connecticut without the Obama administration really being involved if you think about it. Why Yale was allowed basically to gobble up everything in the New Haven area without any regulation is totally beyond me.
Sarah Kliff: You're saying that Connecticut should come in and say if you're going to have this market share, your profits are capped at X, or you have to do Y and Z things?
Steven Brill: Right. The problem with health-care costs in the United States really isn't that there isn't enough competition among the insurance companies. The problem is that the insurance companies have so little leverage over the providers that they're paying.
If you have 10 health insurance companies in the New Haven, the hospital still has more leverage because it doesn't have to deal with any of them. They can just say to two of them we'll make deals with you at these high prices and we're not going to make deals with the other eight.
Sarah Kliff: One of the things that seems necessary to making this work, and one thing you talk about in your book, is price regulation on drugs and devices. This is because you can only do so much to cap hospital costs without doing something about the high prices that hospitals are paying for the drugs they prescribe and devices they insert.
Most other countries use a government entity to say, "Here's what we'll pay for the new Hepatitis C drug" or "Here's what we'll pay for Nexium." Do you think we need to get the government involved in that discussion here, too? It's hard for me to see drug companies just volunteering to cut their prices.
Steven Brill: There may be an idea that Peter Bach [a doctor and writer at Memorial Sloan Kettering Hospital in New York City] just wrote about, where you give insurance companies more latitude to use equivalent drugs, and just that threat may drive the price down. There you've got to worry about who defines what's an equivalent drug.
Again, if you come back to my idea that the doctors and the hospital become the insurance company and if you have the right kind of regulation, including all kinds of ombudsmen in place to deal with those kinds of controversies, that might work. At the end of the day if you give a drug company a patent, there ought to be some way to control the price.
Sarah Kliff: You make a pretty critical argument of the Affordable Care Act in your book that it didn't do anything to control costs. I disagree with that. I think there's more stuff on cost control in the Affordable Care Act than it gets credit for. For example, there's a readmission penalty for when hospitals screw up the first time and patients come back to the hospital. And there are hundreds of the Accountable Care Organizations that we talked about earlier, that are a pretty big experiment the government is running.
Steven Brill: Those things are really small in terms of the overall cost in the health-care economy. Beyond that, you're hard pressed to find things in the ACA that really go at cost. If you're looking at the basic driver of cost, which is a fee for service, there's precious little there.
The Accountable Care Organizations, for example, are voluntary and there's a lot of mixed evidence whether they're working. They are certainly not widespread. And then there's nothing in the law about drug prices and there's nothing about device prices. There's nothing much about anything.
The future of media
Sarah Kliff: You've worked at a lot of interesting media ventures over your career. When you look at the media landscape right now, what trends are most promising? Is there anything that terrifies you?
Steven Brill: Well, I'm not terrified. I've just attempted to do a very serious book and it made the best-seller list the first week it was out, so it's hard to be terrified. I am more generally optimistic because I think that what we're going to start to see is a pendulum swing back from the really light stuff aimed at getting page views and search optimization and all that stuff in favor of deeper, better reporting. You guys are doing that. I'm working on a different kind of project to do that.
Sarah Kliff: Can you talk any more about the venture you're working on with Jill Abramson, to launch a site that would specifically support longform journalism?
Steven Brill: The idea behind that is to put a business model behind the stuff like the Time magazine piece I did. It did very well and it defied the notion that people don't want to read long, deeply reported stuff. The answer is they do if it's different, and if it tells a good story, and if it's important. That takes money, that takes time. You can't do that on the cheap, but the good news is that I think people will pay for it.
The one pattern really is I tend to write about stuff that I don't know anything about
Our notion is to do it on a subscription model where we will tease on various platforms that have lots of traffic. We won't create our own traffic, but we'll tease like 1,000 or 1,500 words of a 20,000-word piece. If you want to keep reading you'll be encouraged to sign up for a trial offer for $.99 that will convert to something for $3 or $4 a month, and you'll get stories like that once a month or twice a month something like that.
We are trying to negotiate deals with platform partners that will want the excerpted content. If we can have platforms that have 100 million unique visitors a month and if we can one-tenth of 1 percent to subscribe to us, we will have a very good business.
Sarah Kliff: Are there other stories you've seen recently that are evidence that people are interested in longform journalism and really good reporting?
Steven Brill: Oh, yeah. I'm starting to see that every day. If you were to ask me the subjects I'm interested in, agriculture would be very far down the list. But that story in the Times about the testing of animals, that's just a great story.
There is an increasing realization that those things work, that they attract readers, and that if you figure out how to market it the right way you can make a living doing it.