Debunking The Myths of Obamacare Rate Shock

Foggy River Bend wallpaper

Foggy River Bend wallpaper

Jonathan Cohn dives into the “rate shock” and Obamacare debate once again, Un-rigging the Rate-Shock Debate, The truth about what those healthy 25-year-olds will pay.

Still, I think many Obamacare critics and quite possibly some of its supporters don’t fully grasp the significance of one key factor: the subsidies.

To review: Obamacare reorganizes the market for people buying coverage on their own, so that they are no longer at the mercy of insurers who pick and choose the healthiest customers. This “non-group” market is pretty small, in relative terms: The vast majority of Americans will continue to get insurance from employers, Medicare, or Medicaid. But for insurers who sell non-group coverages, the rules for conducting business are changing dramaticaly. Under Obamacare, these insurers must provide all beneficiaries with a core set of benefits, for example, and they can’t deny coverage to people who have pre-existing conditions. Insurers are reacting to this by raising premiums. They really don’t have a choice, since they can no longer skimp on benefits or avoid taking on sick people.

If you want to make Obamacare look really bad, you stop telling the story right there. You imagine a young, healthy person who can get cheap coverage today, compare what he’d pay under Obamacare, and, then, declare that Obamacare has “doubled premiums.” But the real story doesn’t end there. And one big reason is that Obamacare also provides people with financial assistance. This assistance, which comes in the form of tax credits, has the opposite effect of the regulations. It makes insurance less expensive.

Conservatives and libertarians who just hate the Affordable Care Act have not been restrained by ethics in how they talk about Obamacare. They have made statements and illogical arguments that range from wacky exaggeration (Look to Communism to Explain Obamacare – Newsmax.com (Dec. 12, 2009) to stories that dig into new depths of depraved lying. While they have succeeded in convincing much of their base, that was to be expected. The unfortunate effect of the propaganda has to confuse many people who are not especially political and have a combination of personal financial worries and concerns about their health care, and how they’re going to pay for it. Before preparing for this post I read a few of what seemed like sincere concerns expressed in comment sections. With some people wanting to get what they heard was affordable insurance, but they’re afaird – see conservative disinformation – they they’ll be penalized for not having insurance, it will change their tax rate for the worse or they will not get the coverage they need. None of those things should concern anyone – with the possible exception of certain young adults who – when buying insurance on their own, may see slightly higher premiums. Though see bold above, much of that costs in around 85% of cases, will be offset by subsidies.

Not everybody can get these subsidies: They are based on income, so that people who earn more money get less help, and people with incomes of more than four times the poverty line get no assistance at all. (That’s roughly $46,000 a year for an individual and $94,000 a year for a family of four.) But the subsidies are a lot bigger and benefit way more people than many people realize. Most of the commentary I’ve seen doesn’t really convey that.

Let’s go back to former Romney adviser Avik Roy’s 25 year old nonsmoking male buying insurance on his own. If he is making poverty wages, say $15k a year ($7.50 hr, 40 hr week), his insurance will be free. I’m going to try to make the rest of this post as brief as possible, but I do recommend going over to the links to read the entire column and in one case, their full report. Claim About Obamacare Reform “Rate Shock” Is “Unfounded,” Urban Analysis Finds

But, as the Urban Institute paper points out, the large majority of young people affected by this will also become eligible for premium subsidies to help buy coverage in the new exchanges that health reform will create, or for Medicaid (if they live in a state that adopts health reform’s Medicaid expansion).  As a result, the age-rating change “would have very little impact on out-of-pocket rates paid by the youngest nongroup purchasers.”

Specifically, the study found:

92 percent of people ages 21 to 27 projected to buy an individual plan in an exchange in 2017 are expected to have incomes less than 300 percent of the poverty line, so they would be eligible either for Medicaid (if their state expands it) or for substantial subsidies to help pay premiums in the exchange.

Similarly, 88 percent of 18- to 20-year-olds projected to buy a plan in the exchange are expected to be eligible for premium subsidies or Medicaid.

The study also notes that among the estimated 951,000 young adults ages 21 to 27 who now buy coverage in the individual market and have incomes too high to qualify for premium subsidies or Medicaid, two-thirds are age 26 or younger and in families with access to employer coverage.

This is also an important point that Avik and others at Forbes and elsewhere are failing to note. Everyone who is under 27 can stay on their parent’s plan. Those plans are almost always lower cost group plans. Plus they will have the slightly expanded guaranteed benefits specified by the ACA. About that Urban Institute Study,

ACA will not cause rate shock

ACA will not cause rate shock

Quick-Take-on-Young-Adults-with-Current-Nongroup-Insurance-or-Uninsured

This chart shows that the people Forbes claims to care so much about will get some kind of tax break/subsidy. In the category of people who buy insurance on their own – non-group insured – maybe 11% may pay more. Though they too will get better benefits and cannot be denied coverage for preexisting conditions. Again, not perfect, but not the “disaster” or “rate shock” being predicted by partisans with an agenda that trumps the facts.

• Given the age-rating gradient HHS has adopted in regulations, premiums for people age 28 to 56 would be very similar regardless of the age rating limits chosen; premium variation across the rating scenarios is concentrated in the age groups of 21–27 and 57 and above.
• Although the average premiums insurers will charge for 21–27 year-olds are lower under 5:1 than under 3:1 rating, subsidies these purchasers receive will leave average out-of-pocket premiums almost identical under the two methods. Over 90 percent of young adults age 21–27 purchasing single nongroup coverage in the exchanges receive significant subsidies that limit their costs as a share of their income.

The ratio seems like wonky stuff, but it is just the limit the ACA places on premiums for the same benefits between young insured and older insured. This is so younger insured are not forced into paying for the higher health care costs of older insured. The full report is available at the link.

Does Rush Limbaugh listen to his own words, “Yes Virginia, There Are Death Panels”: Limbaugh Exploits Child Transplant Patient To Revive Obamacare Myth.

Rush Limbaugh rehashed the widely debunked myth that President Obama’s Affordable Care Act will result in death panels to smear Health and Human Services (HHS) Secretary Kathleen Sebelius, claiming that “Obamacare establishes death panels and right now Sebelius is it.”

Limbaugh used the case of Sarah Murnaghan, a 10-year-old girl awaiting a lung transplant, as evidence that “The government’s making the decision who lives and dies. That’s what Obamacare is.” Later, Limbaugh responded to a caller, saying, “Yes Virginia, there are death panels.”

So Limbaugh wants the gov’mint to intervene in the personal medical care of a patient. That would be something like a death panel would do. The ACA or Obamacare does not give the gov’mint authority to intervene in the diagnostic or medical procedures for individual patients. It could only do so if the government had the authority Limbaugh lies about. And good for Politico (I’m a little shocked that Politico is being so rational) for explaining how the government should not get involved in the case of this one girl because it would likely just mean the death of one or two other girls, Kathleen Sebelius at center of storm over child’s lung transplant

“I can’t imagine anything worse than one individual getting to pick who lives and who dies,” she said. Sebelius said putting Sarah next in line would disadvantage other young people who have also been waiting for transplants — including three in the same area. Helping one child could possibly hurt another.

Some experts agree that the lung allocation policy may need to be revisited; it has been for kidney and liver transplants. But they say no snap decisions should be made because of the media glare.

Should Sebelius step in and do something? No. She doesn’t have all the facts,” said NYU bioethicist Art Caplan. Acting under pressure from a media savvy family “or the noisiest person in line” is bad policy, he added.

[  ]…Caplan noted one reason that may give Sebelius pause: by moving someone up the list, someone else goes down. One child saved could mean another child dies. Sebelius, he noted, “doesn’t have all the information.”

So Limbaugh and other conservatives are the ones acting as Death Panels via media pressure to act on the politics of the moment, not the medical ethics which might save this one adorable little girl, but kill one or possibly three others. This is also a good post on the subject, Suddenly everyone is a backseat expert on medical ethics

Here’s the thing. There are many people waiting for lungs in Pennsylvania now, and few will get them. With so few lungs available, it’s important to come up with a fair, unbiased system that maximizes the potential to make good use of them while also not favoring anyone unfairly over anyone else. There is just no way that it ends well for everyone. When a lung becomes available, someone is going to get it, and others will not. That means one person gets a chance to live, and the rest likely die. It’s tragic, no matter how the decision is made.

Attorney General Eric Holder Did Not Lie Under Oath Period Full Stop

Blue Unisphere wallpaper

Blue Unisphere wallpaper

 

Two of my otherwise good fellow Democratic bloggers might need to go back and do a more careful reading. Firedoglake writes: Did Attorney General Eric Holder Lie To Congress Under Oath?

During Attorney General Eric Holder’s testimony before the House Oversight Committee he made an interesting statement in response to a question from Rep. Hank Johnson (D-GA):

JOHNSON: I yield the balance of my time to you.

HOLDER: I would say this with regard to potential prosecution of the press for the disclosure of material. That is not something I’ve ever been involved in, heard of, or would think would be wise policy. In fact my view is quite the opposite.

Interesting statement given that we now know Holder approved a search warrant for a reporter’s emails who was cited as a co-conspirator in a leak investigation.

Holder was under oath at the time raising the possibility of a perjury charge.

In no way, shape or form does their own post show that Holder lied. Words have meanings. Fairly simple. He said he would not be involved in “prosecution” of the press. It is not quite see Rover fetch the ball, but close in it’s simplicity. We’ll get to some further analysis, but first this post from another Democratic blogger,  The Rosen quest: In (partial) defense of Eric Holder

The pattern emerges again: Obama says the right words, but his administration does the wrong thing.

The news that the Obama administration fought to be able to access Fox News reporter James Rosen’s emails over a long period of time underscores just how much the DOJ latched onto the theory that Rosen was a potential criminal.

Rosen was targeted by the DOJ for his communication with State Department adviser Stephen Kim, who allegedly leaked him information about North Korea’s nuclear program. The DOJ infamously labeled Rosen a “co-conspirator” for his attempts to get the information from Kim. Rosen’s personal emails were searched, and the records of five different phone lines used by Fox News were also surveilled. On Thursday, it emerged that Attorney General Eric Holder had personally signed off on the Rosen warrant.

President Obama said on Thursday that he worried the investigations would chill national security and investigative journalism, and that reporters should not be prosecuted for “doing their jobs.” But his Justice Department apparently did not know this.

One of the most interesting exchanges to derive from this brouhaha may be found on the Brad Blog. Brad wrote a piece which cited Glenn Greenwald’s vigorous condemnation of the Obama administration cavalier attitude toward privacy. In response, a reader accused Greenwald of being close kin to Darrell Issa, the Republican Cairman of the House Oversight Committee.

This is, of course, the overheated rhetoric often employed by those who reduce all of politics to a simplistic game of shirts vs. skins, Us vs. Them. But Greenwald’s response deserves to be quoted:

As for the “substance” of the commenter’s accusations: what I said is 100% accurate. At the time Rosen published his article, barely anybody noticed it. It created almost no furor. Nobody suggested it was a leak that was even in the same universe as the big leaks of classified information over the last decade in terms of spilling Top Secret information into the public domain: the NYT’s exposure of the Bush NSA and SWIFT programs, Dana Priest’s uncovering of the CIA black site network, David Sanger’s detailing of Obama’s role in the Stuxnet attack on Iran, etc.

Nor has anyone claimed that this leak resulted in harm to anyone or blew anyone’s cover. That’s what makes it “innocuous”: it’s a run-of-the-mill leak that happens constantly in Washington, where government officials give classified information and intelligence reporting to DC journalists, who then print it. That happens all the time. All the time. And it has for decades.

All that’s happening here is that Obama followers are doing what Bush followers constantly did to defend their leader: screaming “harm to national security!” to justify secrecy and attacks on the press. But there is no demonstrated harm to national security from this leak and nobody has remotely claimed it’s anywhere near the level of leaks that prompted Bush officials threaten to prosecute journalists at the New York Times.

The effort to spy on Rosen resulted from a classic over-reaction, of the sort we’ve seen time and again in leak investigations.

That blogger ( usually a pretty good one) and Glenn Greenwald ned to get a basic understanding of the difference between a national security leak and whistle-blowing. In the examples that Greenwald cites, those were whistle-blowers who revealed crime committed by the Bush administration. James Rosen leaked a national security secret. Rosen, Fox news and  was and State Department adviser Stephen Kim violated national security laws, compromised the U.S. and U.N. bargaining position on North Kora’s nuclear weapons program. At the very lest Greenwald and those who are like minded should say they don’t care about the marked differences or do not care about national security secrets, or claim that it should not have been a national security secret because it is just Obama beng too secretive and wrap that up with some liberal’s long standing grudge against Obama for that reason. Gleen claims without evidence “But there is no demonstrated harm to national security from this leak.” That is not the case. If it is, Greenwald has offered exactly zero evidence to prove it. I’ve been reading Greenwald for years. he used to make almost iron clad arguments, with supporting evidence, as he did during the Bush administration> What happened. Now he seems to have gone into the ‘ they all do it” and liberals are hypocrites business. Again, with no more proof, than his adamant assertion he is right, period. He seems that a true champion of civil liberties is getting lazy.

The Fox case involved a report by Rosen in June 2009 that American intelligence officials had issued warnings that, should the United Nations adopt sanctions that were under consideration, North Korea would begin conducting new nuclear tests. According to the F.B.I. affidavit in the case, the information was top secret and was contained in an intelligence document disseminated to a small number of government officials that same morning. The report was marked top secret.

Probably no lasting harm was done, but that is simply an educated guess on my part. North Korea has proven to be sociopathic when it comes to acting in it’s own best interests. So they probably would have resumed new tests anyway. Greenwald and bloggers who agree with him do not say that. They claim with absolute, evidence free certainty, that no big deal, it does not matter. As though the humility that Glenn has shown in the past is excess baggage in this case. Glenn is doing what quite a few old-fashioned liberals used to do and still do – though Glenn has never officially declared his political affiliations. They want so much to be regarded as being independent minded, of not being a partisan hack, that they end up being hacks against the truth. This is simple. A very brief story, with some little details that seem to be getting short shift, Fox News Whitewashes Reality To Smear Holder With Perjury Accusations

It was recently revealed that the Justice Department obtained a search warrant for the communications records of Fox News reporter James Rosen in an effort to track down a leaker who provided him with classified information on North Korea in 2009. On May 15, during a hearing of the House Judiciary Committee, Rep. Hank Johnson (D-GA) asked Holder about the warrant and the potential for prosecuting journalists accused of publishing classified information that they obtained from government sources. Holder responded (emphasis added):

With regard to the potential prosecution of the press for the disclosure of material. That is not something that I’ve ever been involved in, heard of, or would think would be a wise policy.

On May 24, the Justice Department released a statement clarifying Holder’s involvement in the approval process for the warrants in question (emphasis added):

“The Department takes seriously the First Amendment right to freedom of the press. In recognition of this, the Department took great care in deciding that a search warrant was necessary in the Kim matter, vetting the decision at the highest levels of the Department, including discussions with the Attorney General. After extensive deliberations, and after following all applicable laws, regulations and policies, the Department sought an appropriately tailored search warrant under the Privacy Protection Act. And a federal magistrate judge made an independent finding that probable cause existed to approve the search warrant.”

Fox News’ Special Report on May 24 argued that these statements were inconsistent and concluded that the Attorney General had previously lied to the Judiciary Committee and thus had committed perjury. Host Shannon Bream began the show stating, “It’s his story, but he’s not sticking to it,” claiming that Holder has “chang[ed] his tune” on his involvement in the scrutiny of journalists. Contributor Steve Hayes claimed that Holder’s two statements were “incongruent” and Charles Krauthammer speculated that it may be “a case of perjury.”

In fact, the statements are not “incongruent” whatsoever. Holder’s comments to the Judiciary referred to the possibility of prosecuting journalists for publishing classified information, but that is not the crime the Justice Department’s warrant accused Rosen of committing. DOJ investigators were concerned with Rosen’s solicitation of classified information, not any subsequent publication of it. Wired explained (emphasis added):

According to the affidavit (.pdf), FBI Agent Reginald Reyes told the judge there was probable cause to believe that Rosen had violated the Espionage Act by serving “as an aider, abettor and/or co-conspirator” in the leak. The Espionage Act is the same law that former Army intelligence analyst Bradley Manning is accused of violating when he leaked information to the secret-spilling site WikiLeaks.

To support his assertion, Reyes quoted an email exchange between Kim and Rosen, in which Rosen told him that he was interested in “breaking news ahead of my competitors” and had a particular interest in “what intelligence is picking up.” He also told Kim, “I’d love to see some internal State Department analyses.”

The suggestion was that Rosen broke the law by soliciting information from Kim, something that all journalists do routinely with sources.

Nonetheless, the federal judge found there was probable cause to believe that Rosen was a co-conspirator and approved the warrant.

In other words, Holder’s on-the-record denial of involvement in any prosecution of news organizations for publishing classified information in no way conflicts with any knowledge he may have possessed or action the DOJ may have taken against reporters for soliciting said information. Fox’s perjury accusations simply don’t align with the facts.

Among those getting the Holder story wrong, Glenn, being a veteran lawyer, should know there is a difference between getting a warrant to track and identify the leakers of a national security secret and prosecuting a reporter. Warrant versus persecution. All the difference in the world between those two things and Glenn knows it. I expect this kind of truth twisting, half facts, balling up everything into smearing sun bites from Fox News, but not someone who has such a great record on keeping his facts straight. Even HuffPo is running with Fox’s lie.