A Dragon in Sheep’s Clothing

I know, I should be used to this by now. It never ceases to amuse/amaze me, though.

Makes a person want to read the original report for one’s self. Now there’s a novel idea — reading the direct report instead of relying on news outlets to interpret it!

Excerpt from The New York Times, “No Big Cost Rise in U.S. Premiums Is Seen in Study”:

The Congressional Budget Office said Monday that the Senate health bill could significantly reduce costs for many people who buy health insurance on their own, and that it would not substantially change premiums for the vast numbers of Americans who receive coverage from large employers.

The eagerly awaited report, which came as the Senate began debate on the legislation, provided Democrats with ammunition against Republicans who have criticized the bill on the ground that it would raise costs for a majority of Americans.

Centrist Democrats like Senator Evan Bayh of Indiana, whose votes are vital to President Obama’s hopes of getting the bill approved, had feared that the measure would drive up costs for people with employer-sponsored coverage. After reading the budget office report, Mr. Bayh said he was reassured on that point.

Before taking account of federal subsidies to help people buy insurance on their own, the budget office said the bill would tend to drive up premiums. But as a result of the subsidies, it said, most people in the individual insurance market would see their costs decline, compared with the costs expected under current law. The subsidies, a main feature of the bill, would cost the government nearly $450 billion in the next 10 years and would cover nearly two-thirds of premiums for people who receive them.

For most people who get health insurance through employers — five-sixths of the total market — the budget office concluded that there would be little change in their premiums relative to the amounts projected under current law.

Excerpt from Fox News, “Senate Health Bill Would Increase Premiums for Some, Report Says”:

The Senate’s health care reform package would drive up insurance premiums for people not covered through their jobs but taxpayer-footed subsidies would help bring those costs down for some, according to a new report Monday.

The nonpartisan Congressional Budget Office report also said the health bill would have a negligible effect on premiums for everyone else. Republicans seized on the estimate as more proof that Democrats’ health care reform plan is a budget buster.

“Most people, according to the Congressional Budget office, will end up paying more or seeing no significant savings. This is not what the American people are asking for. And it’s certainly not reform,” Senate Minority Leader Mitch McConnell said.

The health care reform debate officially began in the Senate on Monday afternoon, with Majority Leader Harry Reid kicking off debate on the floor and Sen. John McCain, R-Ariz., expected to offer the first GOP amendment later in the day. The CBO report offered fodder for both sides of the aisle.

On one hand, the study showed that the sweeping changes would directly lead to higher premiums for those who purchase health care individually. It said that by 2016, that category of insurance buyer — accounting for about 17 percent of the market — would see premiums rise by between 10 and 13 percent.

Those with employer-based coverage would also see relatively little impact on their bills. Those with small group coverage — plans with 50 or fewer workers — would see between a 2 percent decrease and a 1 percent increase, according to the report. Those with large group coverage — more than 50 employees — could see premiums dip up to 3 percent. A $7,400 yearly policy would drop on average by about $100 per person, the report says.

Senate Republicans circulated a memo calling the report a “blow” to claims that the bill would lower costs.

But the report also showed that government-paid subsidies would play a significant role in bringing those bloated costs back down to earth.

NYT quotes directly from the report later in their article:

In its report, the budget office compared estimates of premiums in 2016 under the new legislation and under current law. In either case, after seven years of inflation, premiums would be substantially higher than they are today.

The budget office said the analysis of premiums was extremely complex, so the experience of individuals and families “could vary significantly from the average.”

“In general,” it said, “the proposal would tend to increase premiums for people who are young and relatively healthy, and decrease premiums for those who are older and relatively unhealthy.”

Personally, I still don’t think they — those in DC — have it right.

And now the American people may be distracted from the issue by the Afghanistan war and talk of a “war tax.” They say the “war surtax” would be on the “wealthy” citizens. But pray tell, if the rich can’t afford to buy new cars, hire landscapers or pool boys, or donate to charity, who will really pay for this additional squeeze during a recession?

Rep. David Obey, D-Wis., chairman of the purse string-controlling House Appropriations Committee, is calling the idea a “war surtax.” He said that just as the federal government is expected to pay for its proposed intervention in the health care sector with new taxes, any escalated involvement in Afghanistan should come with a payment plan.

“If we have to pay for the health care bill, we should pay for the war as well … by having a war surtax,” Obey told ABC News in an interview that aired Monday. “The problem in this country with this issue is that the only people that has to sacrifice are military families and they’ve had to go to the well again and again and again and again, and everybody else is blithely unaffected by the war.”

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