AP fact check: Premiums will rise under ObamaCare

posted at 12:55 pm on March 17, 2010 by Ed Morrissey

Barack Obama has gotten bolder in his sales pitch for ObamaCare over the last couple of weeks.  While earlier he kept his fiscal promises as non-specific as possible, generally talking about “bending cost curves” rather than relating it to individual effects, lately he has pledged that his signature agenda item will lower health-care premiums for Americans.  The Associated Press calls shenanigans today in a fact check:

Buyers, beware: President Barack Obama says his health care overhaul will lower premiums by double digits, but check the fine print.

Premiums are likely to keep going up even if the health care bill passes, experts say. If cost controls work as advertised, annual increases would level off with time. But don’t look for a rollback. Instead, the main reason premiums would be more affordable is that new government tax credits would help cover the cost for millions of people.

Listening to Obama pitch his plan, you might not realize that’s how it works.

Well, listening to Obama pitch his plan, people may not realize how math works.  Obama insisted that his plan would lower premiums by “3,000 percent,” which the White House later adjusted to three thousand dollars. But that’s far off the mark, as the AP informs its readers:

An analysis by the Congressional Budget Office of earlier Senate legislation suggested savings could be fairly modest.

It found that large employers would see premium savings of at most 3 percent compared with what their costs would have been without the legislation. That would be more like a few hundred dollars instead of several thousand. …

The budget office concluded that premiums for people buying their own coverage would go up by an average of 10 percent to 13 percent, compared with the levels they’d reach without the legislation. That’s mainly because policies in the individual insurance market would provide more comprehensive benefits than they do today.

The AP misses the point here just a bit, although overall this is a good report.  The insurance policies of the future under ObamaCare would provide more comprehensive benefits, but that’s because ObamaCare would outlaw more modest plans.  The federal mandates of ObamaCare would mean that healthy people would no longer have the choice of low-cost, high-deductible plans that encourage direct spending on routine medical issues, the exact kind of policies that real reform would emphasize.  Obama and the Democrats want to force young, healthy people into committing more money into risk pools in order to keep premium increases down for others — in essence, subsidizing medical care for older, higher-risk pool members.

Obama is flat-out lying about lowering premiums, as the CBO made plain last November.  Not only will premiums continue to increase, they will rise faster under ObamaCare than otherwise, while forcing people into plans they don’t need.  And note that the people who will pay the higher premiums are those who are already under more financial pressure than most — the people who have to buy their coverage as individuals.  Aren’t these the folks that Obama purports to help?

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