Tomorrow night’s the Oscar awards ceremony and I have a favorite. We’re movie goers and usually analyze them pretty carefully.
Well, even if I didn’t think it was a good movie, Moneyball would be my sentimental favorite. Fortunately, it is a good movie. But I owe them. Here’s why.
Michael Lewis has been a favorite writer for years. So when Moneyball was published, I read it and embraced it immediately.
Moneyball led to what was probably the shortest speech I ever gave, one which saved me from potential embarrassment. In 2003, the then New York State Senate Majority Leader, Joe Bruno, created a Medicaid Task Force. The Task Force was co-chaired by Senator Kemp Hannon and then Senator Ray Meier. Hannon’s assistant called and said that the co-chairmen wanted me at the first meeting. I was quite pleased, but asked what they wanted me to do. She said that Senator Hannon would call.
When he did call, Senator Hannon said that the first meeting was just an organizing meeting and not to worry about any kind of preparation. So I blithely showed up prepared to listen and do nothing else. There were perhaps 60 people in the room, only four of whom were not either Senators or Senate staff. There were two from the Association of Counties (NYSAC), Jim Tallon, the head of the United Hospital Fund (a colleague and friend of many years and my former boss) and myself.
Imagine my absolute terror when Senator Hannon opened the meeting by saying that the folks from NYSAC would begin by talking about the financial drain that Medicaid put on New York’s counties. Then Jim Tallon would spend about an hour doing his classic “Medicaid 101” presentation. And then I would tell them what they ought to do.
Got that? With no advance notice and no preparation, I was going to tell the key representatives of the New York State Senate how they should reform Medicaid. It was an middle school nightmare.
Well, it’s not that I hadn’t spent years working on Medicaid, and it’s not that I couldn’t wing it. And it’s not that I’m not arrogant. But while the others were speaking (complete with Powerpoint presentations), I was scribbling an outline of notes so I could do it off the cuff. And I was nervous as hell.
Then one of the Senators asked what had already become a classical question in New York: how does California’s Medicaid program serve many more people for far less money? Tallon, knew how annoying I found that question because the California covered many services outside of Medicaid that New York includes in Medicaid, making it an apples/oranges comparison. But as he was just wrapping up his presentation, he got this mischievous grin, looked straight across the table at me, and said, “well John knows a lot about California and Medicaid, perhaps he’ll answer the question.” In doing so, he, Billy Beane, and Michael Lewis saved me.
Having just finished Moneyball and wanting to use its lessons in an upcoming training session I was to teach, I had just finished these graphics. They happened to be in my bag so that I could show them to a client later in the day.
The first graphic shows the relationship between total payroll for all Major League Baseball teams and the percentage of games they won in 2002. It’s immediately evident that there’s a positive relationship between having more money to pay players and percentage of games won. It’s also evident that there was one outlier, the Oakland Athletics, whose General Manager was Billy Beane.
The second graphic shows cost per game won. It’s pretty obvious who won and who lost that contest.
The Task Force took a short break before my presentation and I ran screaming to Senator Hannon’s Chief of Staff, “your boss, whom I love, has put me in a real bind. I need a copy of both of these graphics for everyone in the room.” She grinned, said, “oh yeah, he does that all the time” and she took the pages for copying.
When we reconvened, I distributed these two graphics and began my remarks. Looking back at my mischievous friend across the table I said, “yes I do want to talk about California, but not in quite the way you might think. I want to talk about baseball. (Cue stirring in the room.) We all know that more money buys better players. But how do we explain Oakland, which has the smallest payroll in Major League Baseball?” I told them about Moneyball, about Billy Beane and most importantly, that Oakland uses the damn data but that we did not use the Medicaid data to figure out what works and what does not. Equally important, we didn’t even have a measurement equivalent to “games won.”
I then pointed to Senator Hannon, Senator Meier, and said, “you two need to become the Billy Beanes of Medicaid.” Then I sat down.
It was hard to tell who was more shocked, the folks in the room who knew me and thought I’d lost my mind or those that didn’t and thought Hannon and Meier had lost their minds for inviting me.
But then a Senator asked, “well won’t it be expensive to gather all those data?” Trying not to be too obnoxious, I reminded him and the room that we already had the data and that we spent over $50 million a year to get it because every time we paid for a Medicaid service we collected reams of data such as patient, provider, service, diagnosis and so on. However, while we had the data, we didn’t use it to make policy or operational decisions.
One of the side benefits of this little show was I learned immediately who in the audience had been a baseball geek growing up. Because they all got it, got it immediately and said so.
Well, I actually think it made a difference. Both the Majority and Minority report of the Task Force addressed the issue. The word got around. Later than year, the New York Post published on op-ed I wrote, Medicaid and Moneyball as Published.pdf. Much of the change was inevitable, but I like to think that I stirred the pot.
But Medicaid aside, on that day in 2003, Billy Beane, Michael Lewis and Moneyball saved me from looking unprepared. Tomorrow night, I hope the Academy rewards them.
Tagged as:
Analysis,
Economics,
Medicaid,
Moneyball,
Movies,
New York,
Use the Damn Data