By FactCheck.org
Summary
We tuned in to watch the president's health care summit at Blair House -- all six-plus hours of it. And we weren't surprised to hear some factual missteps in the discussion:
Analysis
Premium Costs, Up or Down?
Republican Sen. Lamar Alexander of Tennessee and President Barack Obama disagreed about how the Democrats' health care overhaul efforts would affect premium costs.
It all started when Alexandere said the president's proposal, much like the Senate bill on which it is largely based, would increase premiums:
Alexander: For millions of Americans, premiums will go up because those -- when people pay those new taxes, premiums will go up -- they will also go up because of the government mandates.
Later, Obama took on that claim directly, saying that Alexander was wrong.
Obama: No, no, no. And this is an example of where we've got to get our facts straight. ... So 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 as they're currently receiving would go down 14 to 20 percent.
Actually, both men were misleading.
Sen. Lamar Alexander
What CBO said is that for those who are in group policies, there would be no significant change in premiums, compared with what would be paid under current law. For those in large groups, there would be somewhere between no change at all and a 3 percent decrease in premium cost. For small groups, the change could fall between a 1 percent increase and a 2 percent decrease.
The only significant increases would be seen by those who buy their policies individually, CBO said. For those persons, the average premium per person would be between 10 percent and 13 percent higher.
Alexander was technically correct when he said premiums would go up "for millions." CBO figured that 32 million persons would fall into the nongroup market by 2016, should the Senate bill become law.
What he didn't mention is that they would make up only 17 percent of workers covered by private insurance. And he didn't mention these costs would go up because benefits would improve in the nongroup market.
The senator was correct when he cited "mandates" as one cause for the increase -- but that's not the only reason premiums go up. The bill would require plans to have a standard level of benefits. However, most of those buying their own coverage would receive subsidies that would prompt them to buy more expensive plans than they normally would.
CBO said "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."
People would basically use money from the government to buy themselves a nicer plan than they would if they were only using their own money. CBO said well over half of those buying individual policies -- 57 percent -- would get government subsidies "that would reduce their costs well below the premiums that would be charged for such policies under current law."
President Obama
But Obama also misled when he claimed that the costs for "families" would go down by 14 to 20 percent "for the same type of coverage as they're currently receiving." For one thing, he was referring only to policies purchased directly by individuals -- not to all families. And as we've seen, the bill generally would require more generous coverage than is currently provided, at higher cost.
Overall, premiums in the individual market would go up, not down. Some in the nongroup market might choose to keep their current policy, with no changes. The legislation would permit that for a few years. But CBO said those "grandfathered" policies probably would not see a substantial change in their premium costs, relative to current law.
Poll-Watchers
Senate Majority Leader Harry Reid of Nevada cited a Kaiser Family Foundation poll from this month showing that 58 percent of people would be "angry or disappointed" if health care legislation doesn't pass.
Reid: It was interesting what that poll said: 58 percent of Americans would be disappointed or angry if we did not do health care reform this year -- 58 percent.
Reid is correct, as far as he goes. When asked how they would feel "if Congress decides to stop work on health care reform and doesn't pass a law this year," 38 percent said they would be "disappointed" and another 20 percent would be "angry" -- a total of 58 percent.
But the same poll also showed that only 32 percent supported passing a comprehensive health care bill right away, while another 41 percent wanted to put it on hold until later in the year or indefinitely, and 20 percent wanted to give up on comprehensive change for the moment and pass only key provisions. And regarding the health care legislation currently being proposed, only 43 percent supported it, while 43 percent opposed it.
Meanwhile Senate Minority Leader Mitch McConnell of Kentucky said a majority of Americans are against the health care overhaul as it has been framed thus far:
McConnell: If you average all the polls, the American people are opposed, 55 to 37.
He's reasonably close. Pollster.com puts the weighted average of current polls on the subject at 51.4 percent opposed and 41.9 percent in favor. Those polls ask the question a number of different ways: about the Senate plan, the House plan, Obama's proposals and earlier iterations of all of those.
McConnell's figures also are in the neighborhood of what some recent major polls have found. A Jan. 22-24 survey by CNN found 38 percent favor and 58 percent oppose the bills passed by Congress. A Quinnipiac poll done earlier in January came up with 34 percent who "mostly approve," while 54 percent "mostly disapprove." And National Public Radio's poll released Jan. 26 asked about Obama's proposal specifically, finding that 39 percent approved, while 55 percent disapproved.
Coburn's Cost Comments
During his remarks, Sen. Tom Coburn of Oklahoma said that "the government is responsible for 60 percent of the country's health spending." It's a statistic he's touted before. But it's a misleading claim that includes tax revenue lost to the government because of charitable contributions to hospitals and other calculations not normally included in the figure for public spending on health care.
The Congressional Research Service has found that, "in 2007, national expenditures amounted to $2.24 trillion, of which 53.8 percent came from private sources such as private health insurance and 46.8 percent came from public (federal, state, and local government) sources."
So what is Coburn talking about?
Coburn asked CRS to consider the effects of tax subsides on overall health care spending by government. As the agency succinctly summarizes:
CRS: Take a dollar an employer pays for a premium for an employee's health insurance. This dollar is part of the employee's compensation, but it is not taxed like other income (at an average federal, state and local tax rate of 15 percent); it is excluded from income for income tax purposes. In essence, the employee receives a 15 cent government subsidy for this dollar spent on health insurance -- the government pays 15 cents and the employee pays 85 cents.
However, CRS explains in a footnote that "most economists agree that the costs of employer-provided fringe benefits are passed on to employees," not governments. More Premium Cost Claims
Republican Rep. Charles Boustany of Louisiana claimed that the House GOP health care bill would bring down health insurance premiums:
Boustany: We put forth a plan earlier in the year, during the debate, that actually the Congressional Budget Office showed that it brings down the cost of premiums up to about 10 percent.
And, actually, for individuals seeking -- and families seeking insurance in the individual market, those cost savings could even be higher.
It's true that the CBO found that health care premiums for those in the small-group market would decrease between 7 percent and 10 percent by 2016. But the small-group market accounts for just 15 percent of premiums, according to the CBO.
It estimated smaller drops for other segments of the private market. For example, premiums in the individual market, which accounts for just 5 percent of the private market, would go down between 5 percent and 8 percent, CBO said.
The other 80 percent of premiums, which make up the large group market, may go down by as much as 3 percent, CBO said, but may actually stay the same as under current law.
By: Brooks Jackson, Viveca Novak, Lori Robertson, Justin Bank, D'Angelo Gore and Jess Henig
