Mom Of AOL "Distressed Baby" Speaks Out

Even though Tim Armstrong rescinded his decision to cut 401k benefits due to "distressed baby costs," one mom is still seething.
Mom Of AOL "Distressed Baby" Speaks Out

After AOL Chairman Tim Armstrong blamed his now-rescinded decision to cut 401k matching benefits to employees on the costs of "distressed babies", Deanna Fei decided it was time to speak out.

Let’s set aside the fact that Armstrong—who took home $12 million in pay in 2012—felt the need to announce a cut in employee benefits on the very day that he touted the best quarterly earnings in years. For me and my husband—who have been genuinely grateful for AOL’s benefits, which are actually quite generous—the hardest thing to bear has been the whiff of judgment in Armstrong's statement, as if we selfishly gobbled up an obscenely large slice of the collective health care pie.

Let's not set that aside. This is what is wrong with our system right here. Here's a guy who took home $12 million last year, announces his company's highest profits in years, and simultaneously informs employees that sick babies will cost them interest on their 401k match or no match at all! Let's place that front and center as a perfect example of sick, twisted Wall Street priorities.

Fei's situation is a textbook example of why health insurance is so necessary for everyone. In the middle of an otherwise normal pregnancy, Fei went in to labor and gave birth to her daughter four months early. Her baby needed extensive neonatal care and even then, was given about a two-thirds chance to survive. These situations are identical to those which happened before the ACA when insurers would refuse to cover babies, claiming their premature birth was a pre-existing condition.

But there was nothing high-risk about my pregnancy. I never had a single risk factor for a preterm birth, let alone one as extreme as this one. Until the morning I woke up in labor, every exam indicated that our daughter was perfectly healthy. In fact, had signs of trouble emerged, such as bleeding or pre-eclampsia, the doctors would have had the chance to mitigate the danger, administering steroids to speed up her lung development or hormones to delay labor. Instead, even with the best medical care available, we had no warnings, and we will never have an explanation for what went wrong. This is why the head neonatologist referred matter-of-factly to our daughter’s birth as “catastrophic.”


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In other words, we experienced exactly the kind of unforeseeable, unpreventable medical crisis that any health plan is supposed to cover. Isn’t that the whole point of health insurance?

AOL has a self-insured health plan. If they didn't have enough reinsurance for catastrophic claims, that's not something that employees should have to cover. That's a management decision that Armstrong tried to shove off into employees' pensions.

Fei is right to be angry. I would be too. But let's not pretend this is something that just happened this one time. It happens all the time. Management decisions, economic downturns, changes in the industry all pass down to employees. That's what they call "trickle-down economics." Privatize profits, socialize risk.

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