Good news: Health bill would reduce family employer-based premiums by $100-$200 a year

[mcablue]

Congressional Budget Office (November 30, 2009):

By CBO and JCT’s estimate, the average premium per policy in the small group market would be in the vicinity of $7,800 for single policies and $19,200 for family policies under the proposal, compared with about $7,800 and $19,300 under current law. In the large group market, average premiums would be roughly $7,300 for single policies and $20,100 for family policies under the proposal, compared with about $7,400 and $20,300 under current law.
The reductions in premiums described above also exclude the effects of the excise tax on high-premium insurance policies offered through employers, which would have a significant impact on premiums for the affected workers but which would affect only a portion of the market in 2016. As in the nongroup market, the effects on the premiums paid by some people for coverage provided through their employer could vary significantly from the average effects on premiums, particularly in the small group market.

http://cbo.gov/ftpdocs/107xx/doc10781/11-30-Premiums.pdf

Granted, this is not the $2,500 reduction for family premiums promised by candidate Obama, but it is a reduction nonetheless.


http://cbo.gov/ftpdocs/107xx/doc10781/11-30-Premiums.pdf

[jefferson_dem]

1. Hey. Welcome to DU!

Thanks for the "analysis".

[mcablue]

2. Thank the CBO n/t

[high density]

3. This is a lot of maneuvering for $100/year

Congress could pass a tax cut that does that in a few minutes.

[jefferson_dem]

5. The OP is way misleading.

Don't buy the bs...

[jefferson_dem]

8. Self-Delete.

[vaberella]

13. That's what I'm seeing too. n/t

[mcablue]

15. Neither of you explained how it's misleading

You just asserted it. By the way, I only copy and pasted CBO estimates.

[jefferson_dem]

16. You posted a cherry-picked piece of the report.

There's plenty out there that refutes your basic premise and overall point. Look around...

[mcablue]

18. I posted the part about the majority of Americans: Those who get employer-based insurance

That's one big cherry, if you ask me.

And you seem not to dispute the fact that premiums would decrease by $100-200 for that very large group.
How many DU'ers, for example, would you say get their insurance from an employer as opposed to the individual market? How about the American people in general?

There's also the very important fact that candidate Obama promised to lower premiums by $2,5000 for a "typical family." Those in the individual market (for whom I feel very happy) by no means constitute "typical" families.

Here's Marc Ambinder today:

"premiums would be basically unchanged for plans that are part of small and large groups. For small-group plans, the CBO estimates a change of +1 to -2 percent; for large-group plans, a change of 0 to -3 percent--meaning opponents of Reid's bill can't claim that, based on the CBO's numbers, insurance premiums will be higher for people who already have plans under their employers' large or small groups.

[jefferson_dem]

4. Ezra Klein says this is a "good deal".

...

The CBO sees the changes coming from three different sources. First, "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." This accounts for all of the increase in premiums. In fact, it accounts for much more than the projected increase: The improvement in the insurance obtained on the individual market would, on its own, raise prices by up to 30 percent.

But the increase is moderated by two other policy changes. First, the new rules governing the insurance market are expected to make the market more efficient, lowering prices by 7 to 10 percent. Second, the individual mandate, alongside the subsidies and the increased ease of purchasing insurance, is expected to bring in healthier folks, which should save another 7 to 10 percent. Add it all together and we're looking at a 10 to 12 percent increase in premiums for insurance that's about 30 percent better than what people are getting now. It's a steal. And all this is before we get to subsidies.

The CBO estimates that 57 percent of people in the individual market will receive subsidies to help them purchase health-care insurance (folks on the individual market tend to be much lower-income, with much less stable employment). Those subsidies will reduce premium costs by between 56 to 59 percent for the average beneficiary. So in the final analysis, the effect of reform on your typical individual market purchasers is to give them insurance that's about 30 percent better but only 10 to 12 percent more expensive, and then assure them subsidies that will lower their payments by more than 50 percent. And if you're in the small group or large group markets, your premiums are expected to fall a bit.

Good deal, no?

And all this is in advance of the real cost-saving measures in the bill. CBO is looking at 2016, which is long before the delivery system reforms will have really begun working, or the excise tax will have started restraining the growth in premiums costs, or the Medicare Commission will be aggressively experimenting to bring down costs first in Medicare and then in the system more generally. These are the numbers, in other words, from a world in which none of the cost control efforts work. In that world, health-care reform still does an enormous amount to help 30 or 40 million people, and a bit to help tens of millions more.

...

http://voices.washingtonpost.com/ezra-klein/

[avaistheone1]

6. I appreciate this is a reduction, but it is crumbs.

$7,800 for single policies and $19,200 for family is not manageable by MOST families.

Sorry, but we have not achieved health care reform judging by these costs. They are shocking.

:wtf:

[quantass]

7. $100-$200? That's tiny. Imagine what could have been without the unnecessary caving...nt

[jefferson_dem]

9. Better coverage, 6/10 would see premium payments dramatically reduced by subsidies...

CBO: Senate health plan will increase some premiums -- and expand coverage
By Lori Montgomery
The Senate's plan to overhaul the health insurance system would increase premiums in the individual market, but purchasers would get significantly better coverage than under current law and six in 10 would see their premium payments dramatically reduced by new federal subsidies, congressional budget analysts said Monday.

Premiums for most people, who receive coverage through the small and large group markets, would be unchanged or slightly lower once insurance reforms proposed under the Senate plan were fully implemented, Douglas Elmendorf, director of the partisan Congressional Budget Office, wrote in response to a request from Sen. Evan Bayh (D-Ind.).

...

http://voices.washingtonpost.com/capitol-briefing/2009/11/cbo_senate_health_plan_will_in.html

[Oregone]

10. Mandated market activity and subsidized demand causing a price drop?

Heh, this oughta be good.

[Clio the Leo]

11. Or $2,000 for a family a family of four.....

... making $38,000 a year.

[mcablue]

12. Aren't those amounts related to the individual market?

My post concerns those with employer-based insurance.

[Garam_Masala]

23. How can we rely on these estimates when Medicare

costs currently are running 900% of original CBO estimates
adjusted for inflation?

[SoCalDem]

24. One thing to remember about those "old" projections

Tax rates were fairer back then, and they never expected the government to STEAL all the money paid in over the years.. There was planning for the future (which happens to be NOW), and that plan was for the fund to be solvent...not stolen..

It's like having a savings account & forecasting the interest into the future, and then being surprised when there's nothing much in the account..why? because you put in $20 a week, but every month you drew out $75, and put an IOU in its place:)_

[FrenchieCat]

14. The CBO can only take into consideration what are "Certain" cost cuts.....

they cannot take into consideration certain cost saving measures
proposed that are bound to happen but cannot be confirmed, such as
how much exactly will an electronic data base reduce the need
for uncessary tests, thereby further reducing cost, etc....
They estimate other items on the conservative side,
cause that is what they are supposed to do.

So the CBO is not the bible; they only offer conservative estimates and at times
have to refuse to include cost saving items if they cannot determine how those numbers
will look with any real accuracy.

The below is written by an anti Health Care reform conservative with an important admission:

October 26th, 2009
Study: US healthcare system wastes $800 billion a year
This study from the healthcare analysis unit of Thomson Reuters has a high degree of truthiness...

One example — a paper-based system that discourages sharing of medical records accounts for 6 percent of annual overspending.

“It is waste when caregivers duplicate tests because results recorded in a patient’s record with one provider are not available to another or when medical staff provides inappropriate treatment because relevant history of previous treatment cannot be accessed,” the report reads.

Some other findings in the report from Thomson Reuters, the parent company of Reuters:

* Unnecessary care such as the overuse of antibiotics and lab tests to protect against malpractice exposure makes up 37 percent of healthcare waste or $200 to $300 a year.

* Fraud makes up 22 percent of healthcare waste, or up to $200 billion a year in fraudulent Medicare claims, kickbacks for referrals for unnecessary services and other scams.

* Administrative inefficiency and redundant paperwork account for 18 percent of healthcare waste.

* Medical mistakes account for $50 billion to $100 billion in unnecessary spending each year, or 11 percent of the total.

* Preventable conditions such as uncontrolled diabetes cost $30 billion to $50 billion a year.

http://blogs.reuters.com/james-pethokoukis/tag/healthcare-reform/page/2/

------------------------------------

Also, one has to add how much health care would have gone up,
when taking into consideration total savings, i.e.,
perhaps it would cost would have gone up 10%, but because of the reform,
it goes down 2%. That's actually a 12% reduction, although a large chunk
is not totally tangible.

[mcablue]

17. self-delete n/t

[HughMoran]

19. Considering my insurance will otherwise go from $10k to 40k/year

I'll take it.

[mcablue]

20. Then you will pay $100 or $200 less than 40K

I believe you erroneously thought the $100 or 200 had to be subtracted from $10K.

[HughMoran]

21. I work for a small business. I calculated 15k rate based on web site based on House bill

One of the biggest reasons for healthcare reform is so people like me can get into exchanges. Do you know that we can't even hire older people with families as we can't afford to pay for their insurance? The current system is absolutely destroying small business - my rates going from 10k at a large company to 40k at a small company show up this disparity in spades. It's infuriating as it's the same insurance company in either case!

[ProSense]

22. No, you are reading it entirely wrong. n/t