Shocker: CBO says Senate bill will increase healthcare premiums for individuals

Like we didn’t see this one coming, right?

Individual insurance premiums would increase by an average of 10 percent or more, according to an analysis of the Senate healthcare bill.

The long-awaited report by the Congressional Budget Office (CBO) and the Joint Committee on Taxation (JCT) also concluded that subsidies provided by the legislation would make coverage cheaper for those who qualify.

The report, issued in the form of a letter to Sen. Evan Bayh (D-Ind.), will provide both Democrats and Republicans with ammunition as the Senate begins amending the healthcare bill on Monday.

“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. About half of those enrollees would receive government subsidies that would reduce their costs well below the premiums that would be charged for such policies under current law,” the report says.

Though Republicans will seize on the projections that insurance premiums for individuals would increase, Democrats will highlight the conclusion that the legislation would lower premiums by 56 to 59 percent for those individuals who would receive subsidies to buy insurance on the exchange created by the legislation. Of those who participate in the exchange, 57 percent would be eligible for subsidies. The subsidy would cover about two-thirds of their premiums, the report says.

“Subsidies”? You know what that means: You and I will be footing the bill.


This exchange, open to individuals and small-business employees, would provide coverage to just 17 percent of the marketplace, the report notes. The bill would have a different effect on the small-group insurance market utilized by many small businesses and the large-group market of employer-provided insurance, which would cover 70 percent of Americans with benefits. Premiums would range between the same to 3 percent lower for employer-sponsored insurance and from 2 percent lower to 1 percent higher for small-group plans, according to the report.


The analysis does not measure the effects on premiums of a proposed excise tax on the most expensive insurance plans. Consistent with their previous reports, the CBO and the JCT predict that most people who currently have so-called Cadillac insurance plans would opt for less expensive insurance to avoid the tax.

After noting that 83% of the American people don’t buy their health insurance via an “exchange,” Ed Morrissey also points out:

The Senate plan envisioned a $259 billion revenue stream from this [“Cadillac plans”] tax in the first decade. As I argued at the time, this static tax analysis would be proven dead wrong and leave a huge hole in the funding of ObamaCare. The CBO and the JCT apparently agree.

As far as the insurance premiums go, this is yet another example of ObamaCare bending the cost curve … upward. Why will premiums increase? Guaranteed issue and expansion of third-party payer services. Instead of exercising cost control through real reform, the new plan will intensify the existing structural problems of cost in the American health-care system. And since the covered won’t be paying that cost themselves, the rest of the taxpayers who don’t participate in the exchange system will be left with the bill through the federal subsidy program.

And let’s not forget those who choose not to sign on for any kind of healthcare plan, who as a result will be jail time if they don’t pay the fines. They’ll be the ones paying for this so-called “healthcare reform” bill, too.

To recap: In addition to the higher premiums mentioned above, and the fines (and possible jail time) those who don’t sign on for an “affordable” healthcare plan will have to pay, there will be no so-called “savings” from this bill – check. Medicare benefits would be cut – check. A government panel will decide on who will be lucky enough to get certain kinds of healthcare, and who won’t be, in an effort to “reduce Medicare costs” – check. No tort reform, which would majorly bring down healthcare cost, included in this bill, because the left is afraid of trial lawyers – check. Quality of healthcare nosediving – check.

So … just what is it we are supposed to like about this bill again?

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