The squabble between Obama and Alexander

During the Summit meeting, voices got a bit terse when coming to the subject of insurance premiums. Obama said that the health reform bill would reduce insurance premiums for most people. Senator Lamar Alexander disagreed citing the CBO. Obama basically told Lamar he didn’t know what he was talking about.

Well, let’s look at the CBO report

“Each of those components of the legislation has the potential to affect the premiums that are charged for insurance, directly or indirectly; some would increase premiums, and others would decrease them.” Pg 3

Many individuals and families would experience changes in premiums that differed from the changes in average premiums in their insurance market.2 As explained below, some provisions of the legislation would tend to decrease or increase the premiums paid by all insurance enrollees, while other provisions would tend to increase the premiums paid by healthier enrollees relative to those paid by less healthy enrollees or would tend to increase the premiums paid by younger enrollees relative to those paid by older enrollees. As a result, some individuals and families within each market would see changes in premiums that would be larger or smaller than, or be in the opposite direction of, the estimated average  Pg 4

CBO and JCT estimate that the average premium per person covered (including dependents) for new nongroup policies would be about 10 percent to 13 percent higher in 2016 than the average premium for nongroup coverage in that same year under current law. pg 5

Average premiums would be 27 percent to 30 percent higher because a greater amount of coverage would be obtained. In particular, the average insurance policy in this market would cover a substantially larger share of enrollees’ costs for health care (on average) and a slightly wider range of benefits.  Pg 7

CBO and JCT have estimated that, in 2016, the average premium nationwide for those “reference plans” would be about $5,200 for single coverage and about $14,100 for family coverage. Pg 8

Reference: CBO Report

There are 29 pages to the CBO report and I think it’s more than clear that insurance premiums will not decrease but increase under Obama’s health care plan.

Conclusion: Senator Alexander Lamar was correct and President Barack Obama was wrong, again.

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