# Fact Check: Rove Uses Fuzzy Math To Argue Health Reform Would Increase Premiums

This morning, former Bush adviser Karl Rove pulled out a Russert-esque white board to argue that premiums would increase under health care reform in the individual market. Rove relied on a series of Congressional Budget Office (CBO) numbers and claimed that tax increases, the cost shift from Medicaid expansion and insurance reforms could raise premiums by \$4,000:

Four studies by outside groups have found the likelihood of higher premiums, but they are just estimates. The most solid numbers have come out of the CBO, but even then, it was only a partial state. Outside groups estimated that insurance premiums would increase by 20% to 50% under the bill over what they would otherwise be, and the CBO report, which looked at the three bottom insurance programs, found that in 2016, without reform, those policies would cost an average of \$11,000. With reforms, they would cost \$15,000 or an increase of roughly \$4,000.

Watch it:

Rove’s reasoning is as pernicious as his math. In its September 22nd letter to the Senate Finance Committee the CBO does project that premiums in the none group market would cost approximately \$6,000 for individuals and \$11,000 for families, but it also demonstrates that health premiums would be cheaper for a majority of families. Here is how:

1. Overwhelming majority of Americas will pay less than \$11,000: Under the House and Senate bills, an individual who does not qualify for subsidies would pay between \$5,200 and \$5,300 in premiums for a health policy from an exchange (saving up to \$800). Premiums for family policies would cost between \$14,100 and \$15,000, but over two-thirds of exchange enrolless would qualify for subsidies and would spend less than \$11,000 on their premiums. In fact, MIT economist Jonathan Gruber extrapolated the CBO data to argue families could actually see savings “ranging from almost \$8500 for low income families to almost \$1,400 for higher incomes.”

2. More value for the premium dollar: Ultimately, it’s misleading to compare a policy in the exchange with a plan in the individual market. Policies sold in the existing market offer less benefits and even fewer consumer protections. Without reform, older Americans or anyone with a pre-existing condition would not be able to find coverage in the individual market — much less afford it. In its September 22nd letter, the CBO writes that under reform, Americans would receive more value for the premium dollar (plans sold in the exchanges would have higher actuarial values).

All of this is explained in the CBO reports, but omitted in Rove’s white board arithmetic. Rove also misrepresents the so-called “cost-shift” between public and private payers and ignores reform’s the payment increases for both Medicare and Medicaid providers.

# Does The Senate Health Bill Really Cost \$2.5 Trillion?

Over at TPMDC, Brian Beutler takes apart the Republican argument that the mischievous Democrats fooled the non-partisan Congressional Budget Office (CBO) into thinking that the cost of the Senate bill is \$848 billion over 10 years, when the real figure — GOP staffers discovered — is \$2.5 trillion:

It appears as if the number comes from a press release from Budget Committee ranking member Judd Gregg (R-NH), written the morning after the CBO released its analysis, which reads “American taxpayers are about to see an unprecedented expansion of the federal government that will cost a staggering \$2.5 trillion when fully implemented.”

On Saturday, Republicans repeated the figure over and over while debating the motion to proceed:

Moving the start date of the exchanges and most other benefit-heavy policies to 2014 helps bank more money for reform (and meet the President’s \$900B limit), but the bill doesn’t exactly hoard away billions to pay for benefits. According to the CBO, between 2013 and 2015, the government takes in \$54 billion, but pays out \$12 billion to insure Americans who are denied coverage in the individual market and gives tax credits to small businesses that choose to offer health insurance coverage. Over that time period, the bill collects taxes from the health care industry — cuts the industry has already generally agreed to — and banks \$42 billion for implementing reform and expanding the system to accommodate 31 million newly-insured Americans.

The government spends more on health care in the first 10 years but during the decade following the 10-year budget window, “the increases and decreases in the federal budgetary commitment to health care stemming for this legislation would roughly balance out, so that there would be no significant change in the commitment.” As Beutler points out, “the critique elides the fact that, whatever the federal responsibility for health care becomes as a result of this bill, it’s projected to dramatically reduce the deficit in both the near and long term.” And that’s something Republicans didn’t care for until the Democrats introduced legislation taking on the health insurance industry.

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