That “distressed baby" Tim Armstrong blamed for benefit cuts? She’s my daughter

http://www.slate.com/articles/double_x/doublex/2014/02/tim_armstrong_blames_distressed_babies_for_aol_benefit_cuts_he_s_talking.html

by selmnoo • 12 years ago

284 270 12 years ago

slate.com

carbocation• 12 years ago

Also see http://www.slate.com/articles/double_x/doublex/2014/02/tim_a... for the single-page version.

emp_zealoth2• 12 years ago

Isn't it how the insurance works(and the very point of it)? Spreading the risk(and cost) over multitude of individuals? I his words utterly silly

scarmig2• 12 years ago

Tim Armstrong blaming Obamacare (its mandate for medical coverage for situations like this) for the benefit cuts also has an interesting implication:

If not for Obamacare, AOL would have provided a insurance plan that wouldn't have covered this child, and instead left her to die and her family in a permanent state of medical bankruptcy.

ETA: For the record, I think most insurance policies have covered this for awhile. But Armstrong's either very confused, or, more likely, just struggling to find a way to point fingers at anything who's not him.

MattBearman• 12 years ago

  left her to die and her family in a permanent state of medical bankruptcy.

I can't get my head round this, as someone born and raised in the UK, America's health care system (or lack there of) is the single thing that will stop me ever wanting to live in the US.

mp99e99• 12 years ago

According to the article, the family had family insurance plan which would have existed before Obamacare, so I think this is a bit of a red herring. I think he was pointing to increased costs of Obamacare AND the distressed babies as examples.

But I agree, if you can't use your insurance when you need it, whats the point of insurance?

josephfung• 12 years ago

That's not exactly accurate - he's blaming Obamacare for them having to provide new insurance products that have a net higher cost going forward - the incident of distressed babies happened before the ACA, which means they did have that choice, and chose to pay the costs.

Regarding what most insurance policies cover, there are actually several scenarios that would leave AOL on the hook. First, they could have a policy that has an Annual or Lifetime payment limit, which would leave the company (or individual) responsible for anything over. Alternatively, if the number of incidents was significantly higher than average for the carrier, AOL could see a significant premium increase due to the higher utilization of their plan. Or, they could actually be running a self-funded insurance program, which means they are managing the risk instead of relying on a separate insurance carrier.

Either way, there are several situations in which AOL's costs could be significantly impacted by the situation.

HarryHirsch• 12 years ago

Spreading the risk is only half of insurance, the other half is deciding exactly what hazards are covered.

In normal first-world countries you have some form of socialized healthcare with bioethics committees that decide what should society should pay for. You can have reasoned arguments about end-of-life care and very premature babies.

But in America with the crazy system of employee-provided coverage it's the CEO that sets coverage limits, and generally speaking a company's interests are not aligned with society in general.

therobot245• 12 years ago

Armstrong's quotes are quite deplorable and the backpedaling is cringe-worthy but all i could think of while reading the article is Mrs. Lovejoy from the simpsons, "Won't somebody think of the children?!"

ivraatiems2• 12 years ago

Because somebody should think of the children. And the geriatric. And the disabled. Part of the point of having a developed society with a developed healthcare system is using it to sustain people who can't sustain themselves.

I think this article isn't important because one person happened to say something rude about somebody's daughter. It's important because it's a peek into how a lot of people are actually thinking about the world, and that's pretty scary.

therobot245• 12 years ago

not disagreeing with anything here, nor did i in the previous post, merely a light anecdote relating to how thick the writer is 'laying it on'

tommorris• 12 years ago

The point about "won't someone please think of the children?" is that its usually uttered when something that doesn't affect children is going on.

It's a demand that society fight a bogeyman that poses no real threat to children: Sonic the Hedgehog or communists or "gay propaganda" or saucy pop videos.

Asking that one's health insurance cover the delivery of one's baby seems a pretty legitimate demand.

GuiA• 12 years ago

I'm glad this article was written. Armstrong's statements were so despicable that in this case "airing the dirty laundry" is a perfectly appropriate answer.

I'm also surprised that his statements aren't "suable" in some form in the lawsuit happy country that is the United States of America. A friend of mine immediately pointed out to the numerous healthcare privacy laws in place; and another HN commenter pointed out on the original thread the possibility that the employees with the distressed babies would get discriminated against by their coworkers, after Armstrong's statements, due to the fact that they're probably identifiable internally by their team members.

This is the same guy who fired an employee publicly during a company talk for (apparently) taking pictures. (http://www.sfgate.com/technology/businessinsider/article/AOL...)

What a sad, sad man. I hope that he gets scared and lonely as he gets older and older, when his billions won't change anything and when he realizes that all of his misery stems from his own choices.

selmnoo3• 12 years ago

I hope that he gets scared and lonely as he gets older and older, when his billions won't change anything and when he realizes that all of his misery stems from his own choices.

I know the word "sociopath" gets thrown around a lot when we're talking about CEOs, but I really really think this guy fits the bill. And so, in all likelihood, he sadly will not feel or realize a thing even as he gets older.

cosmie2• 12 years ago

And to be honest, I'm surprised that his statements aren't "suable" in some form in the lawsuit happy country that is the United States of America. A friend of mine immediately pointed out to the numerous healthcare privacy laws in place; and another HN commenter pointed out on the original thread the possibility that the employees with the distressed babies would get discriminated against by their coworkers, after Armstrong's statements, due to the fact that they're probably identifiable internally by their team members.

It very well may be a suable violation. HIPAA laws prohibit the "misuse and disclosures of PHI", and PHI includes a person's payment history, not just their medical records[1]. Such a breach by a covered entity is a criminal offence that can result in jail time by the offending employee[2]. As AOL isn't a covered entity (e.g. healthcare provider, insurance company, etc), I'm not sure whether it could be applied directly to Armstrong. You can probably push a HIPAA violation to the insurance company, however, as Armstrong most likely was told of these cases as the basis for group rate spikes during their insurance contract re-negotiation.

And those are just justifications related to violating patient privacy laws. I'm sure a lawyer could also make a pretty strong case against Armstrong personally for defamation.

[1] http://en.wikipedia.org/wiki/Protected_health_information [2]: https://www.ama-assn.org/ama/pub/physician-resources/solutio...

kps• 12 years ago

If, as some other comments say, AOL self-insures, are they a covered entity?

saraid2162• 12 years ago

I hope that he gets scared and lonely as he gets older and older

You realize that will only exacerbate his mistakes, yes?

pwg• 12 years ago

Another interesting quote from the article:

Let’s set aside the fact that Armstrong—who took home $12 million in pay in 2012

Assuming the above is factual (and I have no reason to doubt it), he wanted to cut the 401(k) plan for everyone because of an expense that was one twelfth the size of his own pay that same year.

Just a wee bit hippocritical there on his part.

Tycho• 12 years ago

Just as an aside, I think AOL had the highest stock price increase in 2012 of any comparable company. I wonder how much of compensation was due to capital gains.

eCa• 12 years ago

One sixth. There were two "distressed babies".

CrowderSoup• 12 years ago

I can't imagine that Tim Armstrong sits at home stewing about the high costs of distressed babies, but singling them out in this situation is deplorable.

kabdib• 12 years ago

Memo: Don't screw with someone who can write well.

[Yup, Armstrong is despicable]

jobu• 12 years ago

She quoted this line from some of the TV coverage:

  “How many distressed babies does AOL pay this guy?”

Does anyone know who said that? That's really dark, but also hilarious.

jhonovich• 12 years ago

http://valleywag.gawker.com/tim-armstrongs-salary-in-distres...

keithpeter2• 12 years ago

Less dark: we used to measure budgets, wages &c in units of Rovers (millirovers for small items) for some years in a place I worked in because the Principal decided to buy herself an official Rover - while at the same time freezing expenditure on such fripperies as textbooks, photocopying paper &c. That one ended up on extended sick leave and then a payoff...

gaius3• 12 years ago

This guy is a walking disaster. How is it anyone is willing to work for him?

emp_zealoth2• 12 years ago

He pays money?

gaius3• 12 years ago

It wasn't the only reason, sure, but it has been a contributing factor to me resigning that I couldn't bear to make the management any richer...

fennecfoxen4• 12 years ago

Well, if you work for him, you apparently get Compensation, including salary, 401(k) matching, and a health plan that'll cover your infant's medical expenses even if they run to like a million dollars. For someone or another, that's probably the best deal they were offered.

judk5• 12 years ago

401k benefit is dropping, that's what this story was about before the baby gossip blogging buried the point.

bigchewy3• 12 years ago

Tim Armstrong has an incredible ability to say the wrong thing.

The underlying topic, however, is fascinating. I do healthcare analytics for a living so I see how often a single neonatal ICU incident can consume 30% of an entire company's healthcare budget for the year (note: if you don't really understand healthcare, e.g. what self insuring means, please don't respond with comments that the insurance company pays the bills, this is what insurance is for, etc.).

The economics of healthcare combined with the inability to have a rational discussion on how to allocate resources means that doctors / researchers will apply their research efforts where they will be rewarded. The race to keep younger and younger babies alive is fueled with ego and dollars.

No one wants to talk about scarce resources and how to allocate dollars to have the most impact. I wish conversations stemming from idiotic comments like Armstrong's ended up being productive but they always end up with non-actionable ranting around taking executive pay and giving it to sick people. Unless someone proposes a mechanism to achieve that, it's just a dream / rant.

pavlov2• 12 years ago

The race to keep younger and younger babies alive is fueled with ego and dollars.

If you actually look at the global data on neonatal mortality [1], that doesn't seem to be true.

Countries like Finland, France and Cuba perform better than the United States on this metric. These countries offer completely free healthcare to babies and pregnant mothers.

Frankly, I find your assumption borderline offensive. Maybe you should take your USD-tinted healthcare analytics glasses off for a while and contemplate the possibility that human lives are worth saving.

[1] http://data.worldbank.org/indicator/SH.DYN.NMRT

thaumasiotes12• 12 years ago

You can look at the data, but you can't conclude much from it; those numbers are not comparable to each other.

From 2008: http://pjmedia.com/blog/the-doctor-is-in-infant-mortality-co...

Some (OK, rather extensive) points from the link:

In the United States, all infants who show signs of life at birth (take a breath, move voluntarily, have a heartbeat) are considered alive.
In Belgium and France — in fact, in most European Union countries — any baby born before 26 weeks gestation is not considered alive and therefore does not “count” against reported infant mortality rates.

The baby at issue here would have been just under 22 weeks. (France changed their standard in 2008-2009; their page defining stillbirth ( http://www.insee.fr/en/methodes/default.asp?page=definitions... ) now includes a warning that French numbers cannot be compared to other European neonatal mortality numbers, so it seems safe to assume the rest of Europe has carried on as before.)

According to the way statistics are calculated in Canada, Germany, and Austria, a premature baby weighing <500g is not considered a living child.

The article baby weighed well over 500g. But this is quite relevant to the question of who has better neonatal mortality.

In Switzerland and other parts of Europe, a baby born who is less than 30 centimeters long is not counted as a live birth. Therefore, unlike in the U.S., such high-risk infants cannot affect Swiss infant mortality rates.

This baby's length is not reported, so this is of questionable relevance to this particular baby. But, again, it remains very relevant to the question of "do countries like Finland, France, and Cuba have better neonatal mortality than the US?"

If a child in Hong Kong or Japan is born alive but dies within the first 24 hours of birth, he or she is reported as a “miscarriage” and does not affect the country’s reported infant mortality rates.

This could be a non-premature, 8-pound baby!

Efforts to salvage these tiny babies reflect this classification. Since 2000, 42 of the world’s 52 surviving babies weighing less than 400g (0.9 lbs.) were born in the United States.

Still think "USD-tinted healthcare analytics" biases you against saving premature babies?

Full disclosure: I'm with your parent; I consider spending so much pumping life into these very premature "babies" a self-aggrandizing waste of time, effort, and money. But your comment seems to be grotesquely misinformed.

a3n7• 12 years ago

contemplate the possibility that human lives are worth saving.

Here fucking here.

What do we want to accomplish with the most advanced civilization history has ever seen? Advertising? A flourishing human condition? Fart apps? All? None? Anarchic meritocracy? It's all on the table.

judk5• 12 years ago

Google search [Premature]

bigchewy3• 12 years ago

sigh.

> Maybe you should take your USD-tinted healthcare analytics glasses off for a while and contemplate the possibility that human lives are worth saving.

FYI - I've dedicated the last 10 years of my life to the cause of saving and improving as many lives as possible. Haven't had a paycheck for going on 4 years. Personal attacks like yours don't bother me but are frustrating because it's an example of the difficulty we face as a nation in our effort to improve our healthcare system. We all (myself included) get emotional over individual stories (e.g. Armstrong's comments over 2 lives) but have a much harder time seeing the invisible wreckage and thousands of people dying because of our distorted economic incentives.

jbapple4• 12 years ago

(note: if you don't really understand healthcare, e.g. what self insuring means, please don't respond with comments that the insurance company pays the bills, this is what insurance is for, etc.).

Could you explain more about how self insuring works?

lutusp11• 12 years ago

Could you explain more about how self insuring works?

In normal insurance, the policy payments go into an investment pool that benefits the corporation's stockholders. In self-insurance, the set-aside funds go into an investment pool that benefits you (or your company).

The drawback to self-insurance are outlier claims that can more than wipe out the set-aside (as in the case under discussion). Obviously an insurance corporation has (or should have) a larger pool to deal with outliers than an individual or small company.

This is not to say that big insurance companies aren't sometimes wiped out by a sudden unexpected uptick in legitimate claims. In that case, the company may simply declare bankruptcy and the policy holders are left out in the cold -- just as though they had self-insured. But that's a rare occurrence.

More here: http://arachnoid.com/wrong/index.html#Insurance

ItendToDisagree2• 12 years ago

How exactly are outliers like this not "what insurance is for"? I'm curious (not arguing). I could understand that 'self insuring' is a different beast, but isn't the point of insurance in general (not just healthcare), to protect against outliers?

If the company didn't put aside enough money to account for unexpected cases, such as this, arn't they just being negligent (or at the very least causing their own financial problems)?

lutusp11• 12 years ago

the point of insurance in general (not just healthcare), to protect against outliers?

No, the point of insurance is to enrich the stockholders of the insurance company. This might sound like a leftist rant, but it's actually the singe most important thing to understand about the insurance business.

If a policy term doesn't contribute to the bottom line, it's changed to disfavor the policy holder. If a deductible amount eats too much into corporate profits, it's changed to disfavor the policy holder. These facts explain why some companies and individuals choose to self-insure.

If you buy an insurance policy, the policy's payments go into a corporate investment pool that benefits only the company's stockholders. If you self-insure, the funds you set aside to pay claims go into a personal investment pool that benefits you. For the life of me, I can't understand why more people don't know this.

More here: http://arachnoid.com/wrong/index.html#Insurance

lmm2• 12 years ago

No one wants to talk about scarce resources and how to allocate dollars to have the most impact. I wish conversations stemming from idiotic comments like Armstrong's ended up being productive but they always end up with non-actionable ranting around taking executive pay and giving it to sick people. Unless someone proposes a mechanism to achieve that, it's just a dream / rant.

What about progressive taxation and nationalized healthcare, like most wealthy countries do?

keithpeter2• 12 years ago

What is the frequency of these kinds of incident per thousand live births? What I'm saying is should you not be in favour of a much larger risk pool? Is there any way self-insuring corporations can pool risk without the overheads of an actual insurance company?

UK perspective: I'm interested in the concept of 'health analytics' as our present government are sort of dancing round the edges of the NHS (knowing that any form of direct privitisation/move to insurance based benefits would result in prompt removal from office).

woodchuck642• 12 years ago

Curious that AOL had to pay millions of dollars for insurance claims. Isn't that the insurance company's responsibility?

fennecfoxen4• 12 years ago

Self-insured group health plan.

lutusp11• 12 years ago

The entire point of this issue is that AOL chose to self-insure. That means there was no insurance company.

ars2• 12 years ago

They should have gotten secondary catastrophic insurance. I.e. only for claims over some dollar amount, which are very rare and very cheap to insure for.

woodchuck642• 12 years ago

AOL decides to take on the responsibilities and risks of an insurance company and then blames the employees and Obamacare when it doesn't work out? Wow. Armstrong is quite a piece of work.

fredgrott• 12 years ago

so wait Tim's Logic...

1. Baby born Medical cots $1 Million, INSURANCe COStS $250,00 and yet Tim decides to eliminate 401ks to balance benefits costs over something that does not increase insurance costs? You have to have a significant amount of $250,000 in an insurance pool of AOL employees before that happens..one is not the number that triggers it.

@. He also cited Obamacare. Obamacare is by design to get businesses to pay healthcare for those at-risk employees in the low income brackets so that that preventive health care spent on them decreases the huge medacaid expenses seen later by THE FEDeral Government.Lets not even mention the productivity studies that state employees are more productive when not worrying about uncovered medical expenses.

Seems tome the AOL board shold remove this CEO for gross lacking of clear thinking skills

nilsbunger• 12 years ago

AOL could've chosen a 3rd party insurance company instead of self-insuring. Self-insuring was probably a decision intended to save money compared to getting an external health provider.

The CEO could conclude that these outlier events create too much unpredictability for the bottom line, and thus move the company to an external healthcare provider. Heck, they could even fire the CFO or whoever made the cost-benefit analysis if it was wrong. But blaming the employees, who didn’t create this situation? Unacceptable.

ryguytilidie2• 12 years ago

Thats the real shocking part here. AOL made a poor business decision, paid for it, and the CEO, the very person in charge of business decisions, blames medical complications from a fucking baby. It is absolutely unfathomably terrible from a quality human being perspective.

BSousa• 12 years ago

Just in case the author is reading, change the fucking word placement please.

brown9-22• 12 years ago

Isn't self insuring generally considered more efficient for companies of this size?

I can't find the link right now but I read somewhere that it is common for large companies that self-insure to buy reinsurance to cover themselves against large payouts like in Armstrong's mythical example. The company will typically have an insurance policy for their insurance policy.

tsotha2• 12 years ago

Third party insurance doesn't necessarily save you when this happens. I worked for a company with third party insurance, and when one of my coworkers had a kidney transplant we lost money that quarter as a result of extra charges.

paul5• 12 years ago

My daughter had a similar birth and hospital stay, which also produced a million dollar insurance bill. It costs about $10,000/day to stay in the NICU. I was never able work out why it costs so much, except that this is a major profit center for hospitals, and they use the money to cover other, money losing, departments.

Fortunately Google is run by good people, and they were never anything other than supportive. I'm grateful for having had access to the best care for her. I do think our medical system needs some rethinking though.

fennecfoxen4• 12 years ago

If we think microeconomics for a moment: healthcare for distressed infants could be a textbook example of inelastic demand. Q: How much are you willing to pay to save the life of this child? A: ALL THE MONEY! AND MORE!!

thaumasiotes12• 12 years ago

People are a little more willing to spend someone else's money on less-than-worthwhile pursuits than they are to spend their own. As long as the customers aren't bearing the cost, everything they buy will have a similarly inelastic demand. Healthcare for distressed infants is certainly not an example of inelastic demand where people have to pay for it themselves; even food for healthy infants (a much smaller, and much more cost-effective, expense) doesn't show inelastic demand.

thaumasiotes12• 12 years ago

I do think our medical system needs some rethinking though.

You probaby don't want to hear it, but if I were running a medical system I'd decree that gestating one-and-a-half-pound globs (from the article: "One doctor, visibly shaken, described [the fetus's skin] as 'gelatinous'") outside the womb is a waste of resources. To me, if miscarriages aren't the end of the world, neither are "babies" that die of natural causes within a few minutes of being delivered.

There's just no way spending a million dollars to raise a fetus up to the age of zero passes any kind of cost-benefit analysis. The cost of replacing the thing is much, much lower.

paul5• 12 years ago

I'm aware of that kind of thinking, which is why I'm glad you aren't running the medical system.

Consider who you're talking about when you say, "The cost of replacing the thing".

bluthru• 12 years ago

I don't necessarily agree, but I don't think your opinion should be downvoted.

Consider this: We as a society have more than enough wealth to give ICU care to every infant that needs it. Our medical system is what makes it expensive.

alexjeffrey2• 12 years ago

You place more importance on $1M than on a human life? What if it was your child, would you be doing a cost/benefit analysis and turning to your wife and saying "sorry honey, it will cost more than $100,000 to save our child. might as well get her put down"?

nairteashop2• 12 years ago

one-and-a-half-pound globs

This is a human being we are talking about. A child.

I like to think of myself as someone who can usually empathize with folks who hold a different point of view, but I have never been able to understand someone who looks at a human life in terms of a "cost-benefit" analysis.

eaurouge• 12 years ago

You know I don't agree with the point you've tried to make but it's good to read arguments from various perspectives. Having said that, your last sentence is unnecessarily and (perhaps intentionally?) hurtful to Paul. Would you really call someone else's child "the thing" in person?

cperciva• 12 years ago

There's just no way spending a million dollars to raise a fetus up to the age of zero passes any kind of cost-benefit analysis

If you look at the cost in dollars per QALY, it's not that bad. That million dollar treatment probably produces 40 QALYs, for a cost of $25,000 per QALY; Americans typically pay $50-100k per QALY.

ngpio• 12 years ago

There's just no way spending a million dollars to raise a fetus up to the age of zero passes any kind of cost-benefit analysis. The cost of replacing the thing is much, much lower.

Second-order emotional (and nth-order social and monetary) costs are part of a comprehensive cost-benefit analysis.

The cost of even thinking in terms of "replacing the thing" is predominantly the cost of complete societal ostracism.

ameister14• 12 years ago

The thing is, children's medical care as a whole is not relatively expensive. Elderly care is.

This kind of event is super rare. However,it's not nearly so rare to have an older person go through tons of procedures and spend months in the hospital.

gaius3• 12 years ago

This is called triage: http://en.wikipedia.org/wiki/Triage

It's difficult to discuss these things as people tend to get emotionally involved, but be discussed they must.

luckydude4• 12 years ago

Just curious, do you have kids? I might have agreed with you before I held my preemie (only 5 weeks, nothing like the baby we are talking about) in my hand:

http://www.mcvoy.com/lm/photos/1999/04/16.html

It's easier to make the calls before you have a kid, they are calls in theory. After you have a kid you are changed, what was an obvious call becomes much much more complex.

If you can make that call after holding your own kid, wow.

scrabble• 12 years ago

It is impossible to do a cost-benefit analysis on something like that. It is worth any amount of money if the child can be saved. I'd go to the ends of the earth for my children.

Who knows what these children could end up being or doing as adults? Who knows what value they could end up bringing the world? What they might invent? What health issues they could solve? What priceless works of art they may create?

sgk2844• 12 years ago

If the child lives to 80, she only needs to contribute an additional $12,500 worth of value to civilization per year for this to make economic sense.

Another way to look at this: the government has various estimates for the value of a human life. It averages about $7MM. The "extraordinary" expense of this child actually only requires a 14% increase in value over the average citizen to make sense.

Most importantly though, we must recognize that the actual cost is actually just the cost of risk spread across society, so instead of one person taking the brunt of this cost, we as a society take it together. As a whole, it is negligible on all of us, and it's a risk that any of us can fall into. The value of having a system that supports each other is invaluable. Way more valuable than a measly $1MM. We have strength in numbers and we all benefit when a society supports each other. If we ostracize the statistical outliers in this support system, then the support system itself (the one which we all benefit from) falls apart.

In short, more important than the economic argument (which I argue, still makes sense to spend $1MM on a baby), is the argument that the value to society from supporting each other results in a negligible cost for individuals and a near-priceless benefit to everyone within that society. It's exceptionally difficult to put a price tag on that, and it's orders of magnitude higher than $1MM.

rayiner• 12 years ago

I suggest you inform yourself about the gestation process. I used to think the same way, but when we had my daughter I was surprised how early everything happened. First, embryonic age is measured from the date of the last missed period. So even people who find out early are already several weeks along. By six weeks, before many women even realize they are pregnant, the embryo has a heartbeat. By 13 weeks, most of the basic functionality is already there. By 24 weeks, or the time the baby is a pound and and a half, the fetus isn't a glob, but a fully recognizable, if fragile, human. Much of the development after that is external: hair, subcutaneous fat, etc. I don't know what you consider a coherent thought, but at our 24 week ultrasound our baby already responded as we tried to push her into a position to check her gender. I don't think infants who are born full term are more intellectually sophisticated in some fundamental way.

Yes, this has implications for abortion. I support abortion rights, but the "its just a ball of cells" is a rationale that isn't convincing after week 6-9. And lines drawn on intellectual abilities don't justify in a principled way why it isn't okay to abort full term babies. Lines based on viability are susceptible to the progress of medical technology. The typical 24-26 week line we use is fairly arbitrary in all three regards.

malandrew5• 12 years ago

As callous as it is, this is the best solution under a not-for-profit health system. The cost-benefit analysis in such a system is not 1 million dollars in shareholder value versus 1 million dollars to save a life, but instead is 1 million dollars to save one life (just the first year to save the child. there most certainly will probably be a lot more money spent over the entire life of the person born under such conditions) versus splitting that million dollars over procedures and medicines to save several lives.

At the end of the day, you need to value all person-years-lived equally, and determine who gets treatment and for what based on what maximizes the number of person-years lived over the entire pool of people.

I have no numbers to back this up, but I would expect the greatest benefit from a fixed amount of healthcare dollars spent will be on people between the ages of 4 and 20.

Once you've figured out roughly the cost per medical issue, frequency per capita of each medical issue, and a distribution graphing that issue against the age at which most people are afflicted and number of years left in their lives given their demographic, you can probably come up with a reasonable algorithm for maximizing person-years-lived at a certain health premium per person per year (assuming all dollars go back into the system).

Then the only remaining question that is left for society and individuals to answer is what level of premium will be paid and the medical issues that will be covered at that premium.

Furthermore, I think it would be interesting if we gave people in medical situations the following choice:

"The procedures necessary to save this person's life are estimated to cost 1 million dollars. You can choose to save this person's life, or you can choose to donate $800 thousands dollars to save X number of lives by donating it to procedures that maximize the number of lives saved."

People choosing to exercise their right to spend healthcare dollars on a lifesaving procedure for one individual are the ones that should have to face that philosophical and ethical dilemma of deciding to value one life over many.

If I were running a healthcare system, I would make it policy that everyone put in such a position would have to knowingly have to make that hard decision. It's the only sane way that would put the burden of callousness on the people with the right to to those health services. Just because you have the right to those services, doesn't mean you should exercise them in a not-for-profit healthcare system.

tarr112• 12 years ago

It is unfortunate that Tim Armstrong made these statements and all of us who have had this experience need to relive it.

My daughter also had an extraordinary birth, and was saved by the incredibly expert care of a dedicated team of medical professionals at multiple hospitals in Seattle and Bellevue. The bill I saw was north of 250K and I paid the max of that (which was a few thousand)

It occurred while I was at a startup which i had co-founded (and currently employs over 100 people). I tend to go from startup to startup, with some contract / FTE work in between, and have swung from COBRA to COBRA to keep my health insurance consistent.

Because of ACA, this is the first year that I didn't have to "get a real job" in order to keep pursuing startups.

bilbo0s• 12 years ago

"... except that this is a major profit center for hospitals, and they use the money to cover other, money losing, departments ..."

I think you, like many people, misunderstand the reimbursement regime as it works in American hospitals currently. A patient in an ICU will typically have a DRG associated with him/her. This DRG relates to the acuity, and these in turn, impact the reimbursement level. This is because the complexity of care, as indicated by the acuity level, implies higher resource utilization. For instance, the patient-nurse ratio in a typical hospital room is somewhere right around 4:1. In ICUs this ratio is, more often, 1:1. The ICU also needs an array of techs for a patient... highly specialized techs capable of analyzing and acting on information coming off of the monitor that the tech is responsible for.

So hospitals are not saying, "Hey... we have these people here who we can get a lot of money out of!" The system, as it currently stands, is "volume based", so money comes in for ICU care regardless of what the hospital wants. One of the issues with being volume based in this fashion, is that money does NOT come in for things like data analytics, nutrition departments and occupational therapy for instance. Now here's the rub... how do you offer comprehensive ICU care without due consideration of nutrition? Without the ability and expertise to analyze the data coming off of what could very well be an extensive array of monitoring equipment?

It actually goes further than that... Most hospitals MUST have a clinical equipment department for which they are not reimbursed at all. Of course, the creation of an ICU withOUT a clinical equipment department is out of the question.

So while there do exist cross subsidies in any given hospital, it misses the mark to view the departments on the receiving end of the subsidies as "money losing". This sort of thinking has led the industry to all of the issues we see presently. A good example is the poor reimbursement of primary care... and so primary care becomes "money losing" when viewed in that manner. Instead, I think these departments would better be viewed in the fashion that they are viewed in the "value based" reimbursement regime that the industry is currently transitioning to.

Not only will care delivery facilities be in a better position to provide care to families like your own and others, but the quality of care will increase across that enterprise. Your family was given high quality care because the hospital took money from a "volume based" reimbursement system, and distributed those monies based on the judgement of what were probably some very clever "value based" administrators. I can pretty much guarantee you that they did not view Clinical Equipment, Data Analytics or Nutrition as "money losing" departments.

One of the things that has been missing in the discussion about the health care system is the education of the typical citizen about the tradeoffs and compromises that, for example, hospitals are making internally to deliver the quality of care that they do. I think if the citizenry had a more full understanding of the nuances of things like the reimbursement system, we could have a more productive debate on the issue of healthcare.

paul5• 12 years ago

I didn't mean it as a judgement. It's just the reality that some procedures and areas of the hospital reimburse at much higher rates than others, and it's often unrelated to actual expenses. This isn't random speculation on my part -- I've spoken to hospital administrators as well as entrepreneurs working on fixing it.

clavalle5• 12 years ago

My father in law is a neonatologist and was given an ownership stake of the NICU he started in a midwestern hospital.

He makes around $4 mil/year.

Granted, he does sometimes stay at the hospital for two weeks at a time with only very brief visits home but at this point he also owns apartment complexes, office buildings, a gentleman's ranch with a few dozen horses and staff and on and on.

I think it is shameful, personally, that he profits so much. He works hard and he saves lives, it's true, but how much is enough?

selmnoo3• 12 years ago

Speaking as someone who is also familialy-related to a neonatologist and a cardiologist -- both of whom earn more than a few million per year, I'd say they deserve every last dollar of it. They had to go to school for some while, and work under very tiring schedules. Hell, their schedules are still to this day pretty sucky -- they often tell me how much they envy me for my startup I'll-do-whatever-I-want-whenever-I-want lifestyle.

I think they both earn somewhere between 2 to 5 mil/year, but they spend it extravagantly and handsomely -- that's a very good thing. They're spending it on boats, cars, houses, nannies, restaurants, vacations, etc. etc. They're keeping the money going, they're spreading it out. They save lives, get money, and then help the economy by spending this money.

Now, what IS shameful is what the salaries of these social-app CEOs are. Why is Zuck worth some 20 BILLION? He's just going to sit on it, unlike my uncles he's not going to spend the majority of it. Zuck isn't helping the economy, Uber isn't helping the economy (it's externalizing costs, privatizing profits -- if they didn't exist that'd be a good thing). What is shameful is the profiting from rent-seeking, from making a killing on capital gains, etc. etc. Getting a few million per year isn't that bad, because believe it or not, in the large scheme of things that's little money -- most importantly, it's money that one can realistically spend from year to year. Spending a billion -- that's a challenge.

shiven3• 12 years ago

I think it is shameful, personally, that he profits so much.

Profits from saving human lives. Can a price be really put on a human life? Sure you can cite economics and a number like $7MM or whatever, but would you, personally, decide against paying that amount (assuming you had the money) to save your or your loved one's life, push come to shove?

And of course, it is always about resource availability, in this case the resource being money.

He works hard and he saves lives, it's true, but how much is enough?

Demand and supply. He works at a level of specialization that is a cluster of "black swan" events. Hence also, his crazy hours and most importantly, responsibilities. Do you have experience working at a position that is a nexus of similar conditions? Have you ever felt responsible for the life of not one but multiple human beings? And have that responsibility extend over your entire career, each day, every day? Now tell me, how much money would be enough to do work like that and keep doing it well?

Note: I am specifically focusing on money, because that is the question that was raised. Let's not divert the conversation into job satisfaction or humanity and all that, in this particular discussion.

ekidd3• 12 years ago

I'm delighted to hear that this child is doing well, and I'm utterly appalled at Tim Armstrong's attitudes towards the lives of his employee's children. Apparently it's possible to pay a programmer $100K/year, but spending ten times that to save the life of one of his employee's children is absolutely unacceptable. I'll be sure to keep that in mind the next time I hear from an AOL recruiter.

The whole point of insurance is that a middle-class family can afford to pay $12,000 or $18,000 in premiums per year, but they can't easily afford a $1M black swan medical event. So the insurance company spreads the risk out over a large pool. The system breaks down, of course, if the pool is too small. A company with 10 employees probably can't absorb a $1M expense either. But AOL has 5,600 employees and it had $1.05B in net income in 2012. They can afford it to cover expenses, even if they decide to self-insure.

Of course, another solution is to make the risk pool as big as humanly possible and to get employers out of the insurance business completely, so that no startup needs to worry about medical expenses. The AMA is a messy political compromise to do exactly that. But Tim Armstrong is also upset about the AMA. So I'm not quite sure what his ideal outcome is here.

dlokshin5• 12 years ago

The irony is that if we were to have a single payer or other form of universal healthcare like they do in France, this little girl likely would have died. In France they use "Statistical prognostic" approach which in these sorts of cases withhold NICU services for infants with statistically low outcomes.

Edit: couldn't find data for premies at 25 weeks, but at 37 weeks and below, survival rate in the US is higher than European countries. http://www.cdc.gov/nchs/data/databriefs/db23.htm

goodcanadian• 12 years ago

I have a relative who works in a NICU. A 1 in 3 chance of death is actually pretty good odds (relatively speaking) for a premature baby in intensive care, so no, socialized medicine would not have killed this child.

rwissmann2• 12 years ago

Where does this myth come from that universal healthcare systems like the European ones deny coverage for black swan events? They don't. What procedures are covered has little to do with whether the system is single payer or not.

spamizbad• 12 years ago

Are you sure about that? France's Infant Mortality Rate is lower than the US.

France: 3.34 US: 5.90 (Per 1000 live births)

Source: https://www.cia.gov/library/publications/the-world-factbook/...

stevoski• 12 years ago

Got reliable sources for that claim?

pjc50• 12 years ago

.. and in the universal-healthcare UK, my brother survived being 12 weeks premature.

Do you have a cite for the French system, specifically that withdrawal of care in NICU? English or French will be fine.

masklinn• 12 years ago

in these sorts of cases withhold NICU services for infants with statistically low outcomes

Do you have any source for these claims?

stephenr2• 12 years ago

If you had government mandated "socialised" health care like the majority of the developed world, the actual cost to provide health care would have been nowhere near as much.

I cannot fathom that people accept "12 to 18 $K" as a reasonable amount of money for health care.

HillRat• 12 years ago

The irony is that France didn't even allow most withholding of heroic neonatal care until 2004+ (e.g, la loi Leonetti, etc), whereas the US regularly refused such care until 1984 and then enacted statutory allowances for refusing futile neonatal care in 1986 (Baby Doe revised). Also see the Texas Advance Directives Act of 1999 and withdrawal of futile neonatal care pursuant to it.

In fact, France still does not allow withholding of nutrition and fluids from an infant not on a ventilator, a practice that is permissible in the US when care is deemed futile.

If you want an example of a state that practices more aggressive withholding of care in the NICU, look at the Netherlands, which has a private insurance model more akin to the US. According to the Nuffield report on neonatal medicine, "In the Netherlands, a consensus had been reached by 2003 that ... Dutch perinatal centers should not normally resuscitate and treat extremely premature babies born before 25 weeks of gestation, because of poor outcomes."

According to the report, the difference between the US model and the Netherlands could be seen in that twice as many premature infants born in the US survived to the age of two, but in the US five times as many premature infants had disabling cerebral palsy.

balloot2• 12 years ago

Even your own data completely undermines your point. All those other countries have very comparable preterm infant mortality rates when measured against the US. You say the girl "likely" would have died in France, but in Norway and Sweden (two of the most socialist countries in the world) the girl would have had a better chance of surviving at 25 weeks. By your own data that is supposedly proving the ineffectiveness of single payer healthcare.

Go back to Fox News where people don't actually care about facts if you want to make sensational arguments with zero evidence.

blahedo• 12 years ago

You mean ACA (i.e. Obamacare)? The AMA is the American Medical Association (or at least, that's the apparent referent here).

yummyfajitas3• 12 years ago

...but spending ten times that to save the life of one of his employee's children is absolutely unacceptable.

It's not unacceptable according to TA. AOL insurance (pre-Obamacare) did pay for it:

"Two things that happened in 2012. We had two AOL-ers that had distressed babies that were born that we paid a million dollars each to make sure those babies were OK in general. And those are the things that add up into our benefits cost. So when we had the final decision about what benefits to cut because of the increased healthcare costs..."

http://www.businessweek.com/articles/2014-02-07/aol-ceo-blam...

late2part3• 12 years ago

I don't understand. What does Obamacare/ACA have to do with this issue?

ryguytilidie2• 12 years ago

The craziest thing to me is what an utterly small drop in the bucket this is and how Tim embarrassed the entire company and their stockholders over an expense that is <1% of AOLs revenue and is less than his yearly salary. He should have been immediately fired for both insensitivity and short-sightedness to the point of incompetence.

ceph_• 12 years ago

Man who makes 12 million a year decries outlandish million dollar spending to save child's life. The guy is absolute scum.

pg4• 12 years ago

"I'm utterly appalled at Tim Armstrong's attitudes towards the lives of his employee's children. Apparently it's possible to pay a programmer $100K/year, but spending ten times that to save the life of one of his employee's children is absolutely unacceptable."

Did he say that?

danielharan2• 12 years ago

Not said, but isn't that exactly what his cost cutting implies?

scotty79• 12 years ago

Sometimes it's not about what you say but about what people infer about what you think from what they've heard.

tlogan• 12 years ago

What did he say?

dkural• 12 years ago

What is your interpretation Paul? What did he say? Do you think Tim did anything wrong or do you advice that Tim sticks to his guns on this one & shouldn't have caved in with that second memo?

dylandrop3• 12 years ago

"We had two AOL-ers that had distressed babies that were born that we paid a million dollars each to make sure those babies were OK in general. And those are the things that add up into our benefits cost. So when we had the final decision about what benefits to cut because of the increased healthcare costs, we made the decision, and I made the decision, to basically change the 401(k) plan." -- Armstrong

Whether or not it's absolutely unacceptable to him is debatable, but it is clearly acceptable to use the cost of preserving the lives of his employees' children as a scapegoat, when many other expenses (large engineering salaries, "digital prophets" [1]) could have been noted as examples of excessive expenditures. What ekidd is mad about, and I think reasonably so, is that the attitude of "oh, our employee's child almost died which was costly, so let's cut some benefits" as an acceptable mindset to Armstrong is very troubling. In so doing, he is passing on the price of expensive healthcare costs from AOL to his employees, in the form of a slashed 401k. Now that seems to be pretty close to ekidd's paraphrase -- Armstrong does consider it unacceptable for AOL to pay for his employee's child's healthcare, because he wants to pass on that cost to his employees vis-a-vis 401k cuts.

Now at least in my view, I'd hope my employer would place employees' wellbeing first, and consider cutting benefits as a last possible option, but maybe you have a different view.

[1] http://www.businessinsider.com/shingy-aol-digital-prophet-20...

deveac• 12 years ago

Did he say that?

Setting aside the fact that the post above is obviously not quote from Armstrong, we can't say for certainty what he said because all we have is a reported quote in the press with the sources cited as an unnamed AOL employee's transcript of the call.

The alleged quote from the transcript is:

“Two things that happened in 2012,” he said, according to a transcript provided by an AOL employee. “We had two AOL-ers that had distressed babies that were born that we paid a million dollars each to make sure those babies were OK in general. And those are the things that add up into our benefits cost. So when we had the final decision about what benefits to cut because of the increased healthcare costs, we made the decision, and I made the decision, to basically change the 401(k) plan.”

If you believe the quote is accurate, Armstrong is clearly singling out these two babies as contributing to the reason why the 401k plan was changed.

But we lack all of the surrounding context, and the quote above wasn't even continuous. It does, however, fit the mold of televised arguments he gave on the subject. Obamacare and rising health care costs were cited and a decision to not completely absorb those and pass some of the increase to employees in the form of other benefit reductions was the argument he made in a few different places.

A poor comment to make considering the whole point of insurance and how it works, as well as the size of AOL's insurance risk pool IMHO, but then, I don't know if he even made that comment or qualified it with something like "But this is exactly the kind of worthy benefit and cost we believe should be prioritized above certain other existing benefits."

Given his response, it gives me the impression that he made a comment to this effect, and that it was a poor one to make, but that's just an impression. And it's even harder to say where his heart is on the matter. At the very least he has mentioned in interviews that they actively prioritized their benefits package in light of costs, and clearly healthcare was a higher priority than the 401k benefits that were cut. So for the poster to conclude that Armstrong deems covering the costs of these sick babies "unacceptable", I don't see it. The opposite, if anything. Whether or not he used the sick babies to rhetorically deflect from the fact that AOL is choosing not to absorb all of the rising costs and is passing them on to employees...well that is another story in my mind.

ekidd3• 12 years ago

I wrote in haste while the mother's article was fresh in my mind and I was still assimilating Armstrong's latter statements, and it colored my reaction. I went back to rewrite exactly that part 10 minutes later and I was locked out by noprocrast. Consider my post retracted (and feel free to moderate as you wish, up to and including deleting my account).

I still have deep problems with his statement, and I haven't figured out how to articulate them better yet. But for now, my apologies to Tim Armstrong—whatever he said does not justify my hasty and unacceptably uncharitable reading.

judk5• 12 years ago

AOL does pay health benefits, what happened was they cut 401k to maintain their comp budget.

Rmember : Slate opinion blogs != journalism

saraid2162• 12 years ago

Remember: HN comments != Accurate reflection of the OA's claims.

urethra• 12 years ago

I was LinkedIn stalked by AOL HR two days before this happened. I thought about doing the interview just to get back in the habit but ended up declining the invite and indicating Armstrong's hamfistedness was the reason why.

mindcrime7• 12 years ago

I'm delighted to hear that this child is doing well, and I'm utterly appalled at Tim Armstrong's attitudes towards the lives of his employee's children

Do you really think it's possible to have a comprehensive understanding of "Tim Armstrong's attitudes towards the lives of his employee's children" based on this one little blurb? I mean, seriously... I can't help but think people are constructing a caricature of the man, based on a very limited understanding, and heavily influenced by their own preconceived biases and generic "Robber Barrons, evil, muwahahahaha" stereotypes.

I'm not saying that Tim Armstrong is a good person, as I don't know him. But I am very suspicious of this rush to judgment that seems to be going on here.

anigbrowl2• 12 years ago

He chose to make it specific, rather than just saying 'employee medical insurance costs were higher than expected.' By using the specific medical problems of two families to cast management in a positive light and also to justify changing the firms pension contribution structure to be less generous, he made the decision to present these issues as a zero sum game in which the beneficiaries of medical insurance - something which is part of employee compensation to begin with - were presented as the cause of a reduction in the pension compensation of everyone else.

russtrpkovski• 12 years ago

AOL may be a self insured group where it pays all of the medical costs for its employees. The insurance company merely provides administrative services such processing claims and paying providers.

tiquorsj• 12 years ago

Or, like every other group they get rerated periodically based on claims.

tsotha2• 12 years ago

I'm delighted to hear that this child is doing well, and I'm utterly appalled at Tim Armstrong's attitudes towards the lives of his employee's children. Apparently it's possible to pay a programmer $100K/year, but spending ten times that to save the life of one of his employee's children is absolutely unacceptable. I'll be sure to keep that in mind the next time I hear from an AOL recruiter.

All he said is they changed the 401k plan because of unexpectedly high medical expenses. He didn't say or imply he wished they didn't save the baby. I can give the kid's mother a pass on two pages of disjointed emoting, but I don't understand why a disinterested observer would write something like you've written.

walshemj2• 12 years ago

What I want to know is what was AOL doing with the money that it was supposedly buying insurance with was it not actually buying insurance but trying to self insure? and using the "insurance monney" to boost its books?

The next Question is are the employees 401k's safe and accounted for or is Aol like Maxwell?

Shivetya• 12 years ago

I figure I am going balls deep into an internet tickle fight, but so be it.

Its not AOL's or his responsibility. If anything you can put the cost onto society as a whole. This is the type of insurance the ACA should have been instead of the crap we got. It should have covered catastrophic care, which means million dollar babies provided they can be saved.

No company should feel guilty not keeping up benefits because one or two cases blew the bank. They are not there to fix everything. Insurance is a benefit and benefits can be exhausted or become so costly that the cost of doing business means not being in business.

So yeah, it sucks. Welcome to the world. The solution is to put catastrophic care into the hands of government and let them decide who gets the care. Let employers and everyday people shop for the best care for non catastrophic care and do it across state lines. Put them all on equal footing.

So summary. 1) Government takes care of catastrophic care. They set the limits, the decide who. If you want more you buy it on the secondary market. 2) Individuals and business buy insurance from any/all provides regardless of state. The only rule is, preexisting conditions do not disqualify you. They can however put you into rule #1

don_draper• 12 years ago

Tim Armstrong should not only resign but leave the country. We would be better off without losers like him.

delinka• 12 years ago

"We had two AOL-ers that had distressed babies that were born that we paid a million dollars each to make sure those babies were OK in general."

Is this how health insurance works? Maybe AOL is "self-insured"? I don't understand AOL having anything to do with paying directly for medical treatment. Except, by virtue of making claims and costing an insurer money, the premiums increase. It's as if the insurers, ever-faithful capitalists they are, want to sell us insurance and can't believe we have the gall to make claims against our policies, and have convinced our employers to be equally appalled.

mkreef• 12 years ago

I also had a distressed baby a few years ago that spent months in the NICU of one of the best children's hospitals, had multiple surgeries, was in and out of the hospital for the first few months of his life. Ultimately an incident occurred that left him brain dead and on life support before he was 6 months old. We decided to remove life support and held him as he died in our arms. The family insurance plan offered by my ~1000 employee public tech company covered everything. I never saw a single bill and only had to pay the requisite co-pays. Always wondered how much it all costs...

tarr112• 12 years ago

My condolences. It costs a lot, but I'm sure the costs to your family were much higher that what the insurance company paid.

ZanyProgrammer• 12 years ago

He just exposed employee health data to the world-isn't that a violation of a bazillion privacy laws?

smoyer• 12 years ago

An amazing, baring article that brought back too many memories (our first son was early and classified "distressed", though not nearly to this degree). I'm glad to see she's doing so well, and I really have to wonder why pay health insurance premiums (that claim to cover this sort of catastrophic event), if you can't cash in on that policy should you ever need to (all the while praying that you don't).

It's not like CEOs of large companies are selected for being empathetic, but in this case I'll predict that he doesn't survive the publicity surrounding his statements. Children are (and should be) important to a civilized society regardless of their present capabilities or future expectations.

mzr• 12 years ago

How about AOL stop whining about paying for medical care, and stop employing "digital prophets"? Perhaps then they could afford both the insurance costs and 401(k)s.

http://www.uproxx.com/technology/2014/02/meet-david-shing-ak...

fiatmoney2• 12 years ago

If your company cannot afford to pay $1M insurance claims, you shouldn't be in the business of insuring medical coverage. You should be re-insuring that risk. There are many companies that will be happy to do this for you.

The fact that apparently AOL is on the hook for medical claims by its employees indicates they've made a reasoned judgement that their risk pool is diverse enough that it's worthwhile to self-insure, or they're incompetent.

Either way, it's crazy to set yourself up as an insurer and then complain about having to pay claims. That's kind of the point.

justin66• 12 years ago

Exactly. The expectation from the outset would have been that they'd pay out less over time but experience more volatility, given the small risk pool. Complaining about the volatility is just nonsensical.

I expect Anderson understood this but had to look for a reason to cut 401K matching in a profitable quarter, and increasing executive compensation didn't sound quite right, so... the high cost of saving babies! Whadda guy.

bashcoder• 12 years ago

Yes - there is a middle ground for self insured companies called a stop-loss provision. Companies can still get lower premiums through being self insured, but are also covered against huge losses over a specified amount.

In addition to the horrible way this was handled by management, this is clearly the failure of the AOL benefits team, who exposed AOL to more risk than it was actually prepared for.

judk5• 12 years ago

"My spouses' employer covers million-dollar expenses over 401k benefits, so the CEO is an asshole."

iandanforth• 12 years ago

So I believe the following is true:

1. The costs of the procedures involved are wildly inflated by the private sector healthcare system we employ. 2. Regardless of 1 the effort involved in keeping the child alive was extraordinary. 3. The effort involved was disproportionate to the benefit to society.

It's unlikely the reader will agree with 3. That's ok. But I would ask anyone who disagrees with 3 to think carefully about if there is a line where the effort to save a child's life is too great, and if that line exists, how would you determine where it is, and given that method where is that line for you?

mratzloff• 12 years ago

I don't think you guys understand how this works. Armstrong earned his $12 million salary. Employees, meanwhile, receive health care as an unearned benefit bestowed on the commoners by the wealthy. If they abuse this gift (by having premature babies, cancer, etc.), they will be expected to make up for these extra costs elsewhere.

Blame the law for this: clearly those employees who abuse the system should be fired outright, preferably on a conference call with 1000 people in attendance. Sadly, due to government overreach, it is considered illegal.

brown9-22• 12 years ago

The other very odd aspect of this story is blaming 7 million in new costs on Obamacare.

A large company like aol would have already provided pretty good health benefits. It is very unlikely that the ACA's provisions about mandatory coverage for procedures (such as birth control) would have cost aol anything significant.

michaelochurch• 12 years ago

Tim Armstrong shows us directly what the upper class actually thinks of us.

The mean-spirited worldview shouldn't be a surprise. What is a bit brazen is the "turn the poors on each other" behavior. Usually, it's not so obvious. He had hoped that the rank-and-file employees would, as a response to this phony scarcity (health benefits OR 401k, when the real problem is executive overcompensation) imposed from above, turn their frustrations and gripes at colleagues who get sick a lot (or have sick children, or sick parents) and that the environmental change would, perhaps, prune the company of a few sick people. It didn't work. Now everyone hates him. Good. I hope he dies alone, broke, and miserable. (The "broke" part probably won't happen, but one can dream.)

Whenever the upper class tries to turn the rest of us against each other (say, Mission lifers vs. Google bus riders, who are on the same side even if they don't know it) we should always recognize it for what it is, and attack the real enemy with our combined force.

late2part3• 12 years ago

"shows us directly what the upper class actually thinks of us."

#1 - Tim Armstrong is an ugly man and doesn't speak for the upper class.

#2 - Many many many readers on HN are upper class.

walshemj2• 12 years ago

yes you should never never call out individual emploees in this way WHY the Senior Non exec has not told the Chairman that Mr Armstrong has to go

facepalm2• 12 years ago

I don't understand - doesn't insurance pay for such costs? Why is it an extra burden for a company if one of their employees needs money from the health insurance?

lutusp11• 12 years ago

Because AOL chose to self-insure, there's no insurance company, just an asset pool within AOL itself.

facepalm2• 12 years ago

I see - didn't know that kind of thing exists.

Seems to me they very simply not good enough at crunching the numbers then.

Also, I think even insurances tend to have insurances against very high insurance claims. Maybe they should look into that kind of thing.

malkia• 12 years ago

Helping others is something that we did for very long long time

"The third stage, based on findings from Europe between around 500,000 and 40,000 years ago, sees humans such as Homo heidelbergensis and Neanderthals developing deep-seated commitments to the welfare of others illustrated by a long adolescence and a dependence on hunting together. There is also archaeological evidence of the routine care of the injured or infirm over extended periods. These include the remains of a child with a congenital brain abnormality who was not abandoned, but lived until five or six years old. The researchers also note that there was a Neanderthal with a withered arm, deformed feet and blindness in one eye who must have been cared for, perhaps for as long as twenty years."

http://news.discovery.com/human/neanderthals-were-compassion...

gojomo2• 12 years ago

We need new words to describe new patterns of social news and commentary. For aspects of this situation, I first propose 'paraphrage':

paraphrage (v): to paraphrase in a way to maximize outrage

Tim Armstrong has been widely paraphraged as saying, "we're cutting your 401(k)s because two AOLers had distressed babies last year".

Paraphraging not only brings many profitable clicks, but it removes complicating details that interfere with an audience's offensertainment.

offensertainment (n): amusement or enjoyment felt by taking offense, and expressing moral indignation, usually in solidarity with some larger group

The isolation and individual disempowerment of modern online life has driven many people to seek a compensating sense of joy, purpose, and belonging through offensertainment. Leading offensertainment providers include Gawker, the Huffington Post, and Slate, but the full participatory experience also requires forwarding, commentary, and button-pushing through services like Reddit, Facebook, Twitter – and HN.

davidf18• 12 years ago

I would be interested in the amount that AOL paid compared with the amount that Medicaid would have paid for the same infant.

I would also like to know how much costs would be in France, UK, Germany, Japan.

skuunk1• 12 years ago

Isn't this the same guy who fired one of his employees on a conference call?

http://finance.yahoo.com/news/listen-to-aol-ceo-tim-armstron...

That “distressed baby" Tim Armstrong blamed for benefit cuts? She’s my daughter

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