AP: Obama right on costs; Alexander wrong

Sometimes the facts have a liberal bias.

From the Associated Press:

When President Barack Obama and a Republican lawmaker sparred Thursday over what might happen to health insurance premiums in an overhauled system, both cited a nonpartisan analysis that looked at that very question. The president gave a fairer summary of what the analysis found.

Tennessee Sen. Lamar Alexander declared in his statement to the White House health policy conference that “for millions of Americans, premiums will go up” under the Obama plan. That much could be true — but for millions of others, premiums are expected to go down and those who face higher costs would be getting better coverage than they have now.

The debate on that point is key if Americans are to accept the insurance changes Obama wants. Democrats know that pitching their plan as a means to extend coverage to the uninsured is not enough: They must convince middle-income Americans who already have insurance that they, too, will end up with a better deal under the overhaul. So the squabble was about more than a bureaucratic report.

Obama sharply challenged Alexander on his claim and insisted he had the facts on his side when quoting from the report by the Congressional Budget Office. For the most part, he did.

THE CLAIMS:

Obama: “Lamar, when you mentioned earlier that you said premiums go up, that’s just not the case, according to the Congressional Budget Office.”

Alexander: “Mr. President, if you’re going to contradict me, I ought to have a chance …. The Congressional Budget Office report says that premiums will rise in the individual market as a result of the Senate bill.”

Obama: “No, no, no, no. Let me — and this is an example of where we’ve got to get our facts straight.”

Alexander: “That’s my point.”

Obama: “Well, exactly, so let me — let me respond to what you just said, Lamar, because it’s not factually accurate. … Here’s what the Congressional Budget Office says: The costs for families for the same type of coverage that they’re currently receiving would go down 14 percent to 20 percent. What the Congressional Budget Office says is that because now they’ve got a better deal, because policies are cheaper, they may choose to buy better coverage than they have right now, and that might be 10 percent to 13 percent more expensive than the bad insurance that they had previously.”

THE FACTS:

Both are right, but Obama offered important context that Alexander left out.

The analysis estimated that average premiums for people buying insurance individually would be 10 to 13 percent higher in 2016 under the Senate legislation, as Alexander said. But the policies would cover more, and about half the people would be getting substantial government subsidies to defray the extra costs.

As the president said, if the policies offered today were offered in 2016, they would be considerably cheaper under the plan, even without subsidies. One big reason: Many more healthy young people would be signing up for the coverage because insurance would become mandatory. They are cheap to insure and would moderate costs for others.

Moreover, the analysis estimated that almost 60 percent of the people covered under individual policies would qualify for subsidies, bringing their own costs down by more than half from what they pay now.

Obama was correct that the forecast for higher costs on average is based on the expectation that people would buy better coverage. But that might not be as voluntary as he made it sound. The report said the Senate legislation sets minimum levels of coverage and that would require some people to pay for better insurance than they have now.

64 comments Add your comment

Ragnar Danneskjöld

February 25th, 2010
2:52 pm

I perceive the headline writers for AP do not read the stories below. The last paragraph seemingly challenges the president’s truthfulness.

Ragnar Danneskjöld

February 25th, 2010
2:53 pm

Let’s correct that – the last paragraph may be challenging nothing more the the president’s competence with numbers and economic concepts.

Blue

February 25th, 2010
3:20 pm

CT’s playbook; find any article that backs up what she believes in. By the way, as a person who pays over 40% of his income to taxes, when I see time and time again about 60% getting “subsidies”, you’ll forgive me if my translation is “get ready to pay even more for others”. Tell me, CT…where will the subsidies come from? Ragnar…nice catch on that last paragraph.

Bookman is better

February 25th, 2010
3:58 pm

Why does this lady get top billing? Bookman does a much better job. Look at the number of comments on his Blogs. The guy just knows how to engage a reader. All this lady can do is talk about race and how BAD the GOP is. It’s sick… it really is.

Scott

February 25th, 2010
4:06 pm

Ragnar and Blue got it exactly right. The Chosen One has no clue when it comes to the economy or when it comes to projecting correct numbers. Why? He has NO experience in doing so. People with executive experience, either as a governor or somebody with experience running a company, or somebody in charge of a unit in the armed services do. They HAVE to or else their companies will be unsuccessful. Unfortunately for us, we have a Community Organizer that has never been accountable for proper forecasting or proper projections. All he does is look for the best data that proves his point and runs with it regardless of bogus the data may be. So is it any wonder why Cynthia loves everything he does? Is it any wonder why she does the same exact thing when picking out article to include in her blog?

real fan

February 25th, 2010
5:11 pm

No sale cindy. Now lets watch the dems tear each other up trying to force this issue. Cant wait till the fall.

demwit

February 25th, 2010
5:13 pm

Yeah! The premiums in Massachusetts didn’t skyrocket after their healthcare reform! In fact.., it helped balance the states budget!!

Oh wait…

TINSTAFL

February 25th, 2010
5:19 pm

Do tell, where does the money for those subsidies come from?

There is no such thing as a free lunch!

Abrazos

February 25th, 2010
5:24 pm

“Yeah! The premiums in Massachusetts didn’t skyrocket after their healthcare reform! In fact.., it helped balance the states budget!!”

AND Mitt Romney pushed it through. That was before Romney, the privileged son of a CEO and Governor (and a CEO and Governor himself), decided to fight the “liberal neo-monarchy”. What the hell does that even mean? I think now these guys have been reduced to just grabbing a handful of Scrabble squares to invent these nonsensical words.

Robert

February 25th, 2010
5:31 pm

I wouldn’t let this President run the Starbucks down the road. His ego prevents him from being aware of is that he everytime he speaks he looks like Bush when he made that infamous landing on the aircraft carrier. I have never seen such a defensive manager- what manager begins every talk by using the podium to tell those who don’t agree with him that they don’t know what they are talking about. Make fun of the dude who actually brought the bill?- that is rather backwards as he actually looks liked he came to work- not put on some cufflinks and pose for the cameras.

quod erat demonstrandum

February 25th, 2010
5:32 pm

Since the President reuses to start over or consider alternative plans, why are we giving him any air time, much less inches in a newspaper – oh, I forgot, he knows more than we do.

quod erat demonstrandum

February 25th, 2010
5:33 pm

make that refuses not reuses – typing too fast.

stw

February 25th, 2010
5:49 pm

CT: I don’t know what I would do without your superior intelligence. Obama has never been wrong and you’ve never heard him make a statement that you would not defend to death..Put down the Kool Aid….

Owl

February 25th, 2010
5:51 pm

Hey Jay- If at the time they were the majority and were so right- why did it fail? An unbeleivable alignment for passing massive changes and it has failed? With the “all” media behind this, and it fails? Do not blame the minority buddy. Complete the thought- the blame lies …

stw

February 25th, 2010
5:55 pm

Someone answer one question: Why are we going to pay into this bill for 10 years and only get the rewards for 6 years?? What happens the following decades ?? Where do we get the money ??

kayaker 71

February 25th, 2010
5:56 pm

CT,

Challenge for you…… tell me one thing that concerns you about this President. Tell me something that makes your heart beat faster about his policies in a negative way. Please don’t tell me that you love everything that he has proposed or is proposing. Do you have any doubts about this guy and his image of what he wants America to be? Please don’t give me a Bush dialogue. Limit it to Obama, nothing else.

Granny Godzilla

February 25th, 2010
5:59 pm

had a miserable day, computer issues, so i didn’t hear as much live as i would have liked.

every time i had a chance to lend an ear there was another Republican saying exactly the same thing. obama looked bemused. i guess i did too.

oh hell yes, we can get healthcare.

stw

February 25th, 2010
6:00 pm

KAYAKER 71: Do you really expect someone who spends more time in bed with Obama than his wife to say anything bad about her heart throb ???

kayaker 71

February 25th, 2010
6:11 pm

stw,

No, but I am giving her a chance to have some credibility and credibility is at the heart of a good editor. Opinion is one thing, crredibility is entirely another. It appears at first glance that she is hanging with the black guy just because he is black. I do not mean that in a negative way but she should criticize those things that she disagrees with. She had a great piece on the King family sometime ago and every once in awhile, she comes through with a credible piece of journalism. But when it comes to Bozo, she appears to be completely in the bag. He can do nothing wrong and anyone who disagrees with him is the enemy, especially Republicans. That is not either reasonable or prudent and it makes her look bad and it puts good journalism in the back seat.

Robert

February 25th, 2010
6:20 pm

You go granny- don’t worry about the majority of Americans- its like cheering for your football team with no idea why other than you like the players.

Dave

February 25th, 2010
6:25 pm

The CBO estimates that an enormous amount of health coverage will be achieved through Medicaid expansion. In fact, according to the President’s own Centers for Medicare and Medicaid Services (CMS), over half (18 million) of the 33 million Americans who would gain health insurance through the Senate bill, would do so by enrolling in Medicaid. In many states, the Medicaid reimbursement rate is so low that physicians refuse to treat patients on Medicaid. In fact, in these states the primary users of emergency room care are not uninsured individuals, but are patients on Medicaid who are unable to find a regular physician. Under the Democratic health care plan, it is possible that this problem will be exacerbated because the Medicaid rolls are going to swell

samuel

February 25th, 2010
6:31 pm

Scott@4:06pm, someone with experience as a governer or business owner? You mean like George W. Bush?

Dave

February 25th, 2010
6:35 pm

President Obama in discussing the mandate states that “It makes sense to us to have everyone purchase insurance.” His reasoning is that the mandate is necessary to prevent healthy people from dropping out of health insurance pool and collapsing the market. Unfortunately the mandate will leave young people with an unpleasant choice between expensive, comprehensive coverage and a government fine. As Senator Grassley pointed out this would be the first time in our nation’s history that the government will fine individuals for failure to purchase something

Dave

February 25th, 2010
6:45 pm

Tom Harkin re-iterated his claim that we need to have affordable and comprehensive coverage for all. Does he not realize that these two goals are in direct conflict with each other? Providing comprehensive coverage with no lifetime annual caps, low deductibles, low co-payments, mandates for certain procedures that insurance must cover, and community rating systems will not lead to lower health care costs and will lead to higher premiums for most families. The first session of the health care summit was focused on controlling health care costs. The second session of the health care summit is focused on insurance reform, with the ultimate Democratic goal of universal health coverage. If they are serious about reconciling these two goals, the bias in the tax code that subsidizes comprehensive coverage at the expense of catastrophic coverage has to be removed. If the Senate health bill passes, individuals will get more comprehensive coverage through mandates, but costs and premiums will continue to explode.

Dave

February 25th, 2010
6:46 pm

All sides of the debate are interested in reducing cost and expanding coverage. Many of Obama’s proposals use government policies to force companies to reduce price, which is not the same as reducing costs. Obama wants to mandate companies to provide government-approved insurance, and mandate that individuals buy insurance, and controls the price at which they can provide it; in other words, government has created a “market” by forcing the buyer to buy and the seller to sell, and has set the price. If real costs fall, and competition is expanded, prices will fall too. On the other hand, if the market is replaced by a government controlled exchange costs will only rise but prices will be fixed low. Like any price control this will mean shortages – and waiting lists. At that point the government will be forced to introduce rationing and targets to direct health care providers that have no interest in serving their customers. The NHS in the England provides clear evidence of what happens when you go down this road

fitzgerald

February 25th, 2010
6:47 pm

Will the person that is already on welfare and receiving food stamps be required to buy insurance? If they are then they will be the first ones to go to prison because they cannot afford health insurance. Then they will be better off in prison receiving free room/board, food, medical treatment, etc. Only in America.

Dave

February 25th, 2010
6:48 pm

Will health insurance premiums increase from the Senate bill? As usual the president is playing fast and loose with the facts. The Congressional Budget Office (CBO) says that premiums would go down in the individual market from the Senate bill for the kinds of insurance offered today. The problem is that the President’s bill also makes it impossible for people to get that kind of insurance. They would be forced into more expensive plans, with higher premiums. 27% to 30% higher according to the CBO report because of the mandates. And so, overall, premiums in the individual market would go up, not down.

Moreover, there are several studies showing why CBO is wrong about premiums declining for current policies.

Here’s one. Oliver Wyman Inc., a respected actuarial firm, did a careful study for the Blue-Cross Blue Shield Association. They found that premiums in the individual market would be 54 percent higher in five years’ time if the Senate bill were enacted, and 20 percent higher for those insured through small businesses.

Why the difference with CBO? The reason is that CBO thinks the individual mandate will be effective in bring people into the market. That is not at all the view of many, many experts who understand the insurance business. Almost uniformly, they say the mandate in the Senate bill is too weak and won’t work. Consequently, the risk pool will become much less healthy over time, thus driving up premiums.

So, no, Senator Alexander should not at all concede the point. He’s right. If the Obama plan were enacted, premiums in the individual market would go up, a lot.

Granny Godzilla

February 25th, 2010
6:50 pm

Robert

good evening. i think you are wrong. i understand the Kaiser Foundation survey.

i trust my husband and father as respects football support, no matter, my tailgate is fabulous.
football is soap opera for testosterone based life forms. it’s cool.

WILLIAM H.

February 25th, 2010
7:07 pm

I live on a small pension and social security; yet I am expected to help provide health care subsidies for middle income families? What in the He.. is up with that? Give me a f…..g break!

samuel

February 25th, 2010
7:10 pm

Obama will give the Republicans 5 or 6 weeks to get on board, then will get the bill passed through the reconciliation process. Then let the chips fall where they may. If the Republicans gain a majority in November, they’ll probably try to repeal the bill. If they do repeal it, it will be vetoed by Obama. Since the Republicans won’t have a 2/3 majority, they won’t be able to override the President’s veto. Bottom line: Within 2 months, health care reform will be law. Republicans will have to get used to it.

Granny Godzilla

February 25th, 2010
8:02 pm

william h

so do grampt g and i. i understand. .

we all do and always have paid for those who can’t afford health care.

do some research on the cost effectiveness of single payer universal care. best thing since sliced bread. that is if the bottom line is really your bottom line.

the “f’ing” does your argument discredit.

Down in Albany

February 25th, 2010
8:04 pm

samuel: I don’t believe he’ll give them 5-6 weeks. Probably more like 5-6 days. He’s a pompous fool and that will prove it to more people who haven’t figured it out already.

Scott

February 25th, 2010
8:40 pm

Samuel…Yes, I do mean someone like Bush. He didn’t try to totally redo the healthcare system citing bogus numbers like this clown has. Yes, we do need reform, however, we do not need reform at the $1 Trillion cost that the Chosen One is proposing. There are other ways to get reform done. The problem is that he doesn’t care to hear them because he wants more government control. Instead, he picks and chooses the data he wants to use to support a total government takeover of healthcare. He has been terrible at predicting how the economy would respond to an outrageous Stimulus Bill that has one nothing and now we are allowing him to ruin 15% of our economy. You may now go ahead and do what you do best….blame Bush.

Captain Chaos

February 25th, 2010
8:45 pm

I predict that if the GOP “do nothing” plan continues, everyone’s insurance premiums will go up and up and up and up and up.

And I’ve been proven right just since I typed that sentence.

Scott

February 25th, 2010
9:20 pm

Captain Chaos,
GOP “Do nothing” plan??? Answer honestly. Have you actually gone to the GOP’s website to see their plan? Their plan has been on there for quite some time. Given your comments, I am also assuming that you believe the Dem party leadership when they say that the GOP is the party that obstructed the whole thing, right? It is kind of hard to obstruct anything when you aren’t even invite there to obstruct it, right? Don’t forget, the Dems had a SUPERMAJORITY and could have passed anything they wanted to. Stop blaming the Reps for the Dems’ failure to pass this dangerous POS legislation.

Robert

February 25th, 2010
9:22 pm

Good to hear granny- then you are well aware that the majority of Americans do want well thought out, structured. open. honest healthcare and insurance reform. You are also aware that the majority of Americans do not want and do not trust the bill in its current form. Otherwise, go Saints- I like the guys in those helmets better!

Granny Godzilla

February 25th, 2010
9:38 pm

robert

they don’t like the bill as you frame it. the kaiser foundation study, very interesting.

messaging and timing. checkers and chess.

Granny Godzilla

February 25th, 2010
9:40 pm

oh and robert,

go saints? as in geaux saints? i do have a fondness for toujac’s and tipitina’s.

Kamchak

February 25th, 2010
9:47 pm

Granny Godzilla

Have you ever been to Coop’s Place?

TnGelding

February 25th, 2010
10:05 pm

If the young people are so cheap to insure and don’t use the healthcare system that much, Why not just enroll them (and everyone elde) in Medicare?

I was disappointed the dialogue didn’t progress instead of repeating the old talking points. I think the bill(s) could be saved if the GOP was allowed to have a few more amendments approved, but it doesn’t sound like that’s what they want.

Acer706

February 25th, 2010
10:07 pm

Obviously, education of our current healthcare system lacks in Washington. Gov’t already sets costs for care services and procedures. If CPT Codes or even HIPAA are alien to you… debate isn’t work the time.

Reality

February 25th, 2010
10:40 pm

The republicans continue to play their same old games of twisting facts to scare the public. Does this really shock anyone?

“Taxes will increase.” No, the tax cut on the wealthy will expire.

“Health insurance premiums will increase.” No, it will go down for the SAME coverage. If you want additional coverage, then of course it will cost more.

The republicans are only around to lie, play games, mis-represent the facts, and finally oppose anything presented by anyone other than their own. In their eyes, THIS is “standing firm” for their values – to heck with the fact that in the meantime, the US people are suffering.

Vinny

February 25th, 2010
10:46 pm

Nice job Cynthia- How long did it take you to cun-n-paste this one? 10 seconds? I smell another pulitzer!

Abrazos

February 25th, 2010
10:47 pm

Ummm, William H. at 7:07, hate to point out the obvious but YOU are being subsidized if you receive Social Security. What’s more, you’re being subsidized on the backs of middle-class working families.

Acer706

February 25th, 2010
11:04 pm

“Reality”

You’re an idiot.

Kamchak

February 25th, 2010
11:10 pm

“Reality”

You’re an idiot.

Time for Acer706 to go to the muttonhead’s blog.

Acer706

February 25th, 2010
11:32 pm

Oh, I forgot. Stating the facts are against your rules.

Kamchak

February 25th, 2010
11:37 pm

Oh, I forgot. Stating the facts are against your rules.

I don’t decide the rules, our hostess does. Name calling is a no-no.

30 something Man

February 25th, 2010
11:51 pm

William H…I’m also sure you getting Medicare since you’re retirement age…Hmmm…that’s all socialized medicine. please stop taking my money too and i’ll glad not use your dime for Healthcare reform. And then when you do that..Keep your grandkids home from school so I don’t have to pay for their eduation since I dont have any kids.

South Fulton

February 25th, 2010
11:52 pm

I voted for Health Care Reform….So give it to me.