Quick Fact: Baier distorts CBO report to claim premiums “will actually go up” under Senate bill
Posted in Main Blog (All Posts) on December 2nd, 2009 5:47 am by HL
Quick Fact: Baier distorts CBO report to claim premiums “will actually go up” under Senate bill
On Fox News’ Special Report, anchor Bret Baier misrepresented the Congressional Budget Office’s (CBO) analysis of the Senate health care bill’s effect on insurance premiums by claiming that “depending on how you read” the report, insurance “premiums for many people will actually go up” under the bill. In fact, CBO estimated that premiums would only increase for individuals purchasing insurance on their own — about 17 percent of the insurance market in 2016 — and that affordability credits would substantially lower costs for many of those individuals, a majority of whom would receive those subsidies through the exchanges.
Baier cites CBO to claim, under Senate health bill, insurance “premiums for many people will actually go up”
From the December 1 edition of Fox News’ Special Report with Bret Baier:
BAIER: The Congressional Budget Office’s assessment of the Senate bill — in part, depending on how you read it — says that premiums for many people will actually go up and that costs will not be driven down. The White House says that’s not true. So what is the truth?
Fact: CBO found bill would actually result in lower premiums for most individual enrollees
Premiums will only rise for nongroup market — about 17 percent of the market in 2016. In a November 30 analysis, the nonpartisan CBO estimated that for premiums, the “largest effects would be seen in the nongroup market, which would grow in size under the proposal but would still account for only 17 percent of the overall insurance market in 2016. The effects on premiums would be much smaller in the small group and large group markets, which would make up 13 percent and 70 percent of the total insurance market, respectively.”
Federal subsidies will actually lower premiums from current costs for about 57 percent of the individual market. The CBO estimated that while the average premium per person in the nongroup market would be about 10 to 13 percent higher in 2016, “those figures indicate what enrollees would pay, on average, not accounting for the new federal subsidies. The majority of nongroup enrollees (about 57 percent) would receive subsidies via the new insurance exchanges, and those subsidies, on average, would cover nearly two-thirds of the total premium, CBO and JCT [Joint Committee on Taxation] estimate. Thus, the amount that subsidized enrollees would pay for nongroup coverage would be roughly 56 percent to 59 percent lower, on average, than the nongroup premiums charged under current law.”
Premiums would remain unchanged and could decrease for large and small group insurance markets. The CBO also estimated that for the large-group market, which it said would make up 70 percent of the total insurance market in 2016, “the legislation would yield an average premium per person that is zero to 3 percent lower in 2016 (relative to current law).” Further, in “the small group market, which consists of employers with 50 or fewer workers, CBO and JCT estimate that the change in the average premium per person resulting from the legislation could range from an increase of 1 percent to a reduction of 2 percent in 2016 (relative to current law).”
Major cost-saving measures kick in after 2016. The CBO analyzed the impact on premiums for 2016, but as Jonathan Cohn noted on The New Republic‘s health care blog, “many of the cost-saving measures in the bill aren’t expected to yield savings until after that date.” The Washington Post‘s Ezra Klein similarly wrote:
CBO is looking at 2016, which is long before the delivery system reforms will have really begun working, or the excise tax will have started restraining the growth in premiums costs, or the Medicare Commission will be aggressively experimenting to bring down costs first in Medicare and then in the system more generally. These are the numbers, in other words, from a world in which none of the cost control efforts work. In that world, health-care reform still does an enormous amount to help 30 or 40 million people, and a bit to help tens of millions more.
