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Quick Fact: Morris falsely suggested health care reform will lead to “higher premiums” for “most”

Posted in Main Blog (All Posts) on April 6th, 2010 4:47 am by HL

Quick Fact: Morris falsely suggested health care reform will lead to “higher premiums” for “most”

Dick Morris falsely suggested that the recently-passed health care legislation would lead to “higher premiums” for “most” Americans. In fact, the Congressional Budget Office (CBO) estimated that by 2016 the Senate’s version of health care reform — on which Obama’s plan is largely modeled — would not increase premiums for the vast majority of Americans, and for many, premium costs would decrease.

From the April 5 edition of Hannity:

SEAN HANNITY (Host): Joining me now with analysis on why it took the President of the United States 17 minutes to justify hiking taxes on you, the American people is the author of the forthcoming new book 2010: Take America Back, Dick Morris is with us.

[…]

MORRIS: What is interesting is that he spent 17 minutes and he still didn’t tell the truth. The truth is that the big tax increase in this bill is the one that is going to force insurance companies to levee on people in the form of higher premiums, and that is going to take effect immediately, and in the next few months most of the listeners to this program will receive notices from their insurance companies saying that there are higher premiums.

FACT: CBO found law will not raise premiums for majority of Americans

CBO: Premiums in group market will not increase. CBO estimated that the large group and small group markets make up 83 percent of the insurance market and that those premiums would essentially remain unchanged and could decrease.

PolitiFact: “CBO reported that, for most people, premiums would stay about the same, or slightly decrease.” A January 27 PolitiFact.com analysis labeled the claim that health care reform would cause premiums for most Americans to increase “pants on fire” false and stated, “The CBO reported that, for most people, premiums would stay about the same, or slightly decrease.” From PolitiFact.com:

On Nov. 30, 2009, the Congressional Budget Office, or CBO, released a detailed analysis on how health insurance premiums might be affected by the Senate Democrats’ health care bill. The CBO is an independent agency whose estimates for pending legislation are considered nonpartisan and rigorous.

The CBO reported that, for most people, premiums would stay about the same, or slightly decrease. This was especially true for people who get their insurance through work. (Health policy wonks call these the large group and small group markets.) People who have to go out and buy insurance on their own (the individual market) would see rates increase by 10 to 13 percent. But more than half of those people — 57 percent, in fact — would be eligible for subsidies to help them pay for the insurance. People who get subsidies would see their premiums drop by more than half, according to the CBO. So most people would see their premiums stay the same or potentially drop.

CBO: Most individual enrollees would receive subsidies, which would decrease the premiums they pay by “56 percent to 59 percent” on average. CBO estimated that by 2016 a majority of people insured on the individual market would receive subsidies, which would decrease their premiums compared to what they would pay without health care reform. CBO stated, “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.” Claims that the bill would increase premiums in the individual market are based on estimates that do not factor in subsidies.

Washington Post‘s Ezra Klein: “CBO found health-care reform would reduce premiums.” The Washington Post‘s Ezra Klein reported on an exchange between Obama and Sen. Lamar Alexander (R-TN) during the February 25 health care summit:

Lamar Alexander and Barack Obama just had a contentious exchange on this point, so it’s worth settling the issue: Yes, the CBO found health-care reform would reduce premiums. The issue gets confused because it also found that access to subsidies would encourage people to buy more comprehensive insurance, which would mean that the value of their insurance would be higher after reform than before it. But that’s not the same as insurance becoming more expensive: The fact that I could buy a nicer car after getting a better job suggests that cars are becoming pricier. The bottom line is that if you’re comparing two plans that are exactly the same, costs go down after reform.

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