If Only the President Knew

John Hayward of Human Events watched president Obama’s little covered press conference after his acceptance of Veteran’s Affairs Secretary Eric Shinseki’s resignation. Hayward was looking for clues to the new talking points issued in response to the latest crisis.  He wrote:


Obama’s trying to pass the whole thing off as an unfortunate natural catastrophe, not deliberate malfeasance and shocking incompetence from himself and Secretary Shinseki, is both predictable and annoying… But it’s the President’s ensuing remarks that get really weird and outrageous. It’s not hard to see what he was trying to do: prepare the Sunday-show battleground with official talking points …

They’ve trying to unite behind the insulting and ridiculous position that the only real problem with the VA was insufficient funding – throw more tax money at the problem and everything will be fine! …

Another talking point Obama wanted to convey to his Sunday-show humanoids was a variation on the old “I just read about all this in the newspapers” dodge, in which he claims he and his top officials had no idea anything was wrong.

Something about the conference bothered him. While Hayward may simply have been paranoid, today’s opinion piece by CNN’s Gloria Borger provides an eerie confirmation of his suspicions. The piece, “Obama defeated by his own bureaucracy”, describes an idealistic president betrayed by his minions.  Mr. Smith came to Washington, but Washington proved too much for him.

(CNN) — When Barack Obama was a newbie president, there was no shortage of ambition or lack of confidence in the government he was about to lead. Government should be seen as a force for good, not evil. Sure, he told us, it needed to be “smarter and better,” but that could—and would—happen under his watch.

Never mind that Bill Clinton spent years “reinventing government” with mixed success. Or that only 2% of the American public believes that government can be trusted to do the right thing all the time. President Obama was convinced he could change all that with programs that would deliver for America—such as health care reform—and the public would be grateful.

Instead, the President is living his own version of “Alice Through the Looking Glass”: staring down a rabbit hole of government bureaucracy and inefficiency. The government he has studiously tried to grow, manage and change has become his own personal nemesis. All of which makes you wonder: Does the President himself trust government anymore?


Yet it’s not as if he couldn’t have seen the shoal water ahead.  If the Veteran’s Administration has turned out to be too complex to fix, then the much larger and more complex Obamacare program — which encompasses 1/6th of the US economy — may be in serious trouble.

Obamacare Flowchart

Obamacare Flowchart

Bolger’s assertion that ‘everybody knows government is hard’ is revisionist history. Ezra Klein confidently assured his Washington Post readers in 2009 that government delivered health care better. “Does The Government Run Health Care Better?” he asked. Yes he answered. He presented his view of healthcare systems in ascending order. “If you ordered America’s different health systems worst-functioning to best, it would look like this: individual insurance market, employer-based insurance market, Medicare, Veterans Health Administration.”  Klein’s claim was the VA was best, followed by Medicare.

Using government to deliver healthcare was the smart way, the European way, the wonk way to do it.

This assertion has since been called into question by events. The tragic problems of the VA are now too well known to bear repetition. But even Medicare doesn’t look much better.  Modern Health Care summarizes a recent report by the Medicare Inspector General revealing serious problems summarized in one word: “upcoding”,  a fancy name for bill inflation. Providers cheated Medicare out of $6.7 billion from coding errors alone in 2010. To solve things the CMS is going to “educate” the malefactors and exhort them not to do it again.

Medicare overpaid physicians $6.7 billion in 2010 for evaluation and management services, HHS’ Office of Inspector General said in a study released Thursday. The overpayments, which allegedly stemmed from incorrect coding and poor documentation, accounted for more than one-fifth of the $32.3 billion the CMS paid for E/M services that year. E/M services are basic patient health assessments performed at a physician’s office or clinic.

In a podcast, OIG officials Dwayne Grant and Rachel Bessette said they conducted the most recent study based on preliminary findings from 2012. In that report, the government found E/M services are “vulnerable to fraud and abuse” and that upcoding—billing Medicare for visits at higher, more expensive levels than they should’ve been—was rampant from 2001 to 2010. However, the agency was not able to discern if those E/M payments from its initial 2012 study were inappropriate. …

The newest report said 42% of office billings had incorrect codes, including those that were upcoded and downcoded, and 19% did not have sufficient documentation. The results came from a stratified random sample. The higher coders also were more likely to have errors or lack documentation, according to the report. …

The OIG recommended the CMS take three steps: better educate physicians on what is needed for E/M claims, follow up on erroneous claims and prompt private contractors to closely monitor E/M claims from high-coding physicians.

Medicare officials said they would ramp up education efforts, but they do not want to further audit doctors. The CMS said it has already completed one phase of medical reviews for high-coding physicians and started the second phase last August.


Whether this is likely to work I leave the reader to decide. It took 4 years to uncover the 2010 Medicare problems. At this rate of spotting fall of shot, we may find out how Obamacare is faring by 2018.  But we can guess already. Perhaps the most interesting Obamacare anecdote involves SERCO, a contractor running a data entry center in Missouri under a $1.2 billion contract.

Serco is supposed to process Obamacare applications, input the data into computers, and complete the sign up process, but the employee told KMOV that weeks could pass without an employee processing an application.

“The main thing is that the Data Entry side does not have hardly any work to do. They’re told to sit at their computers and hit the refresh button every ten minutes- no more than every ten minutes. They’re monitored to hopefully look for an application. Their goals are set to process two applications per month and some people are not even able to do that,” the employee said.

According to the Huffington Post, SERCO is still hiring. In that way they only need to hit the refresh button every 20 minutes. Ironically, the Washington Post more or less predicted this would happen because back in 2013, Sarah Kliff saw SERCO was an accident waiting to happen.

I wrote a story for today’s paper about Serco, the contracting firm that recently won a $1.2 billion health law contract. That story focused mostly on a British investigation of the firm’s parent company, Serco Group, for overbilling the government by “tens of millions of pounds.”

What didn’t make it into the story was some interesting background on the firm, which plans to hire 1,500 workers to handle any paper applications for health coverage under the Affordable Care Act. Most of it came from a conversation with Alan Hill, Serco’s head of media relations. Here’s what I learned.

Ninety percent of its business is with the federal government. Based just outside of Washington in Reston, Va., Serco is a 25-year-old firm that pretty much owes its existence to government contracting. “We have 8,000 workers across 45 states,” Hill said. “Since the beginning of our existence, we’ve worked heavily with the federal government.”

Serco’s experience isn’t in health care. It’s in paper pushing. The $1.2 billion health law contract was the company’s first under the Affordable Care Act, Hill said. But that doesn’t mean the firm is inexperienced. It has contracts with numerous government agencies to process applications. “This contract has a lot to do with records management, processing applications and that kind of work,” Hill said. “We do a lot of that work for other agencies, like processing visas. We do that work in New Hampshire and Kentucky.


Kliff saw it coming. But Obama didn’t. So is Kliff one of the betrayers or one of the betrayed? If president Obama really, really believed government could do it better and was simply double-crossed by venal and incompetent underlings then his education has been sadly deficient up to this point. But the phenomenon of the ignorant king has been described before.

The New York Times excerpted a passage from Anatoly Rybakov’s Children of Arbat in 1987. “The scene is the Arbat, the intelligentsia’s quarter in central Moscow that is now largely demolished. The year is 1934, the beginning of Stalin’s terror, when even relatives of the victims could still believe that the unexplained disappearance of their loved ones was some kind of mistake that would soon be set right, if only they could get word to Stalin.” In it Sofiya dreams of how Stalin would set things to rights once he learned of the injustice that had befallen them.

She would take out the newspapers and gaze at the pictures of Stalin, his simple clothes, the kind wrinkles round his eyes, the wise, calm face of a man with a clear conscience. He was 53. His oldest son was probably the same age as Sasha, and there was another son and a daughter. He knew what family grief was – he had only just lost his wife. If only Sasha’s case got to him. She was pinning all her hopes on Mark, her brother. He was the head of a huge construction project in the east, a favorite of Ordzhonikidze’s. The whole country knew who he was. Stalin knew him, received him and talked to him. Mark would tell Stalin about Sasha. Stalin would ask for the file, perhaps even call Sasha to him. And he’d like Sasha, he couldn’t help liking Sasha.

Yet she realized how futile these hopes were. Mark would not talk to Stalin about Sasha. But he had talked about Sasha to other highly placed and influential people. She trusted Mark. He had not tried to deceive her or calm her. He would do everything he could.


“If only Stalin knew”. That was the phrase that eluded Hayward when he was watching the Obama press conference. Here was the modern equivalent of the ignorant, idealistic king. If only Obama knew. Well he never does know, apparently, until he reads it in the papers. Maybe he should read Sarah Kliff.

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