Responding to Secretary Sebelius’ Claims on Obamacare Cutting Costs
Secretary Sebelius is out with a new op-ed in tomorrow’s Washington Post, which attempts to argue that Obamacare is lowering health care costs. Apart from the obvious fact that the Medicare actuary disagreed with this assertion – concluding that the law will RAISE health spending by $310,800,000,000 – other claims in Sebelius’ article merit rebuttal:
- The article states that Obamacare “makes health plans more affordable for small businesses and individuals by creating” insurance Exchanges. This claim mis-states facts in two key respects. First, the Congressional Budget Office concluded that Obamacare’s new mandated benefits package will RAISE premiums in the individual market by an average of $2,100 per family – that’s not “making health plans more affordable.” Second, the article implies that many Americans will benefit from Exchanges – but in reality very few will do so. CBO estimates that only 24 million Americans will buy plans from the Exchanges, and only 20 million – less than ten percent of the 266.5 million Americans under age 65 – will actually receive taxpayer subsidies to buy coverage on the Exchange. If as many Americans received subsidized coverage from the Exchanges as the article implies, the cost to the federal Treasury would skyrocket.
- The article notes that the law “emphasizes prevention, because we know it is far less expensive to prevent disease than to treat it.” Actually, we know that that statement is FALSE – CBO and others have concluded that most preventive services actually cost money, not save it, because more money gets spent on preventive treatments for people who would never have contracted a disease anyway. (Whether prevention is good policy is of course another story, but the idea that “prevention saves money” is in large part bunk.)
But as we pointed out earlier this week, the ultimate proof that Secretary Sebelius’ claims lack any merit comes in the form of premiums – namely, higher insurance premiums. The fact that Secretary Sebelius touts “requir[ing] insurers to justify premium increases of more than 10 percent” as a sign of progress shows how much Obamacare falls short of expectations, because according to candidate Obama, premiums should not be going up at all – they should be going DOWN.
As a reminder, candidate Obama repeatedly promised his health care plan would LOWER premiums by $2,500 per family, and do so within his first term. But the price of the average employer-sponsored plan ROSE by more than $2,200 per family since Obama was first elected in 2008, according to studies from the Kaiser Family Foundation. In other words, Obama’s abandoned promise has cost American families over $4,700 per year – a $2,200 premium increase compared to a $2,500 promised premium reduction. That’s making health care UN-affordable, and it proves why we can’t afford the “Affordable Care Act.”
