I took it for granted that the massive tax hike on the working poor would not have subsidies after a few years. I tend to assume its the way Democrats will ensure they are defeated in the elections by about 2016. That seems to be the general plan; they have to get back to parity with the Republicans which is a pretty tall order.

But this’ll do it nicely.

A 12% tax increase on the poorest. A hyper regressive and massive tax increase. Had Bush or McCain tried this it could never have passed. Obama is working very hard for the elites introducing anti-progressive legislation Bush could only dream of.

12% is the lowest the tax will be, right? It just goes up and up from there to what? 20%, 30%, 40%? People will simply refuse to pay and be fined and/or jailed over it.

Just to put it in perspective, the Republicans would scream over a 1% tax increase on the rich.

I think perhaps people can’t do the math on this. It’s a recession. massive tax hikes are not good. Poor people are on the edge. This tax will simply be impossible for most people to pay. So they’ll get fined by the IRS and have no coverage. And they won’t be able to pay the IRS so… I think jailing people has been discussed.

Debtors prison in the US is currently reserved for men I think (for inability to pay CS to women), but I think there was talk of expanding it for this debt. Funny how first they strip away some small group of men’s rights knowing nobody ever cares, and then they ramp it up from there.

I assume this disaster is deliberate as I cannot see otherwise why a party would commit political suicide.

The subsidies aren’t pegged to 2010 levels, they are pegged to levels that get started in 2013 as I understand the bill.

And, some health wonks with good credentials think premium prices will actually reduce in the Exchange overall over 10 years, so if you pegged the subsidies, the level would actually reduce.

Also, pegging subsidies to health care price inflation absent a commitment to keep the price down is just a way to shovel taxpayer money into insurance industry bank accounts, something of an issue.

As for 12%, I’m in agreement, too high.

So letsgetitodone is wrong that the subsidy inflation will begin immediately and already likely have cut the ‘accounting for inflation’ amount by 40-50% by 2013? Well, that’s good. The provisions are complicated, but going forward from 2013 it seems clear that the bar on taking more than 12% of income disappears because, as Appleby says, “the cost of coverage would shift [in year two] from a percentage of income to [whatever the initial] percentage of the premium [was], no matter how high the premiums go.”

12% is the upper limit for 2013. After that there effectively is no limit. From 2014 the ‘limit’ is whatever percentage of the premium was subsidized in 2013. As premiums inflate, especially since premiums are inflating at a rate way over the official inflation rate, the take on % of income inflates quickly.

No, not necessarily. Lets may well be right about price inflation of premiums between now and then. However, when the subsidies kick in in 2013, their levels will be calculated off the premium prices at the time, as I understand it, not at the premium levels that are in place now.

So the cost of private plans may drastically increase between now and then, but when the subsidies kick in, the price paid will be brought down to 12% of income for folks in the Exchange.

Now, once the Exchange kicks in, there is no ceiling on what private plans can charge, and so, sure, they could try and increase their rates by astronomical percentages. But there will be a public option in the Exchange, and if the private companies increase their prices too much, the public option will become cheaper than private plans and steal all their customers. So the lid on price increases in the Exchange is honest competition with a public option.

Could anyone here afford to take a 12% before-tax drop in income?

If the public option premiums inflate at about the same rate as all health insurance policies have been recently, then the competition is ineffective and we’ve got a rapidly increasing ‘% of income’ impact on the already near-poor. That really shouldn’t be allowed to be a possibility. The solution is fairly obvious, tie the subsidies to premium inflation. You still would get competition if the public option inflated at a lesser rate, but not the potentially catastrophic ‘tax increases’ on people who are close to the edge already.

I make millions posting these diaries, so sure. ;-)

Why would the public option premiums inflate at the same rate? The wonks are saying it wouldn’t, see the link above.

The point about pegging the subsidies is that if prices go down, your subsidies would go down also, and economists are saying the prices may indeed start trending downward.

I wrote about this here over two weeks ago. http://seminal.firedoglake.com/diary/9910

It is a big problem that I wish more people would discuss. If your health wonks are correct and that premiums in the exchange would decrease initially as competition works its way out, then perhaps this is less of a problem than I thought. But I need more info on the predicted premiums for exchange policies over the ten year period. Since premiums are so expensive now in the individual market, it makes sense that they would start at a high rate and go down over the first years of the exchange. I think in MA, premiums have dropped 40% over what the average individual market premium was pre reform. So we may be on to something here.

I haven’t heard that. On what basis would policy rates reduce in the absence of any robust public option?

Why is a health insurance cost increase beyond an already very onerous 12% of income even a possibility? Why not account for inflation, and yes if costs go down subsidies should go down too, I don’t see that as problematic. And far from everyone agrees the cost of premiums will soon stop wildly inflating, especially with the new requirements placed on for-profit insurers. Kevin Zeese:

The plan does not create affordable health care. Families earning $90,000 will find themselves paying 20% of their income on health insurance. And, the subsidies for poor and working Americans will be insufficient. The leading source of increased poverty is America’s working poor. How can these working families afford to buy insurance – even if they are forced to by the government – when they cannot even put food on the table? Americans will ask – why are struggling workers being forced to pay the $10 million salaries of insurance executives?

By the time most of this plan takes effect in 2013, the year after the next presidential election, insurance premiums will have increased by 20% to 25%. During the election year, Americans will be looking toward 2013 and seeing increased insurance costs and realizing they will be forced to buy overpriced insurance at the threat of increased taxes. Because of the lack of cost controls and the increased insurance requirements, e.g. like requiring acceptance of people with pre-existing conditions and putting no limits on lifetime benefits, the insurance industry will be increasing rates even more quickly. The failure of “reform” will become evident before it takes effect.

Kevin Zeese is executive director of Prosperity Agenda (www.ProsperityAgenda.US), who along with Health Care NOW! and the Center for the Working Poor initiated the Mobilization for Health Care for All, http://www.MobilizeForHealthCare.org. It is being joined by more organizations everyday, if your organization wants to endorse the Mobilization please contact me at KZeese@earthlink.net.

http://www.counterpunch.org/zeese10202009.html

The 40% drop comes from this recent paper by Jonathan Gruber at MIT (http://voices.washingtonpost.com/ezra-klein/Gruber%20House%20nongroup%20premium%20analysis%2011-2.doc) h/t Ezra Klein. Here is the money quote:

This conclusion is consistent with evidence from the state of Massachusetts. In their December 2007 report, AHIP reported that the average single premium at the end of 2006 for a non-group product in the U.S. was $2613. In a report issued just this week, AHIP found that the average single premium in mid-2009 was $2985, or a 14% increase. That same report presents results for the non-group markets in a set of states. One of those states is Massachusetts, which passed a health care reform similar to the one contemplated at the federal level in mid-2006. The major aspects of this reform took place in 2007, notably the introduction of large subsidies for low income populations, a merged non-group and small group insurance market, and a mandate on individuals to purchase health insurance. And the results have been an enormous reduction in the cost of non-group insurance in the state: the average individual premium in the state fell from $8537 at the end of 2006 to $5143 in mid-2009, a 40% reduction while the rest of the nation was seeing a 14% increase.

Eventually, though, premium inflation will resume once prices stabilize after reform. And then these problems will begin to kick in.

Thanks. The linked article — depending on how similar the House plan is to the final bill and how similar it is to the Massachusetts plan — is reassuring up to 2013, but the inflation problems of 2014 and afterwards remain.

No, we’re talking with a public option.

The paper is actually explaining why insurance premiums would decrease, or at least not grow as quickly, after 2013, not before.

I’m in agreement that affordability, especially at the Finance levels, is a real problem, which is where a lot of this analysis comes from. The levels in the HELP and House bill are better, still probably not quite enough, but a good deal better.

Your link doesn’t say anything about the ten-year trend, it’s about the initial decline in premium levels when health insurance reform kicked in in MA. I thought this comment there was interesting:

Premiums in the Mass. individual market did indeed go down. But premiums in the small group market (which was merged with the individual market as part of health reform) went up. A more accurate headline would be “Massachusetts provides evidence that health-care reform lowers INDIVIDUAL MARKET insurance premiums”. I fully expect to see the same thing with federal health reform (as it is designed to accomplish exactly this).

There is very little evidence that health reform in Mass. has lowered health care costs (yet), although it does appear that it created an environment where a serious discussion about payment reform is possible. AND it led to hundreds of thousands of people getting insured that wouldn’t be otherwise, which improves the health of the population.

Posted by: AronB | November 3, 2009 10:33 AM

http://voices.washingtonpost.com/ezra-klein/2009/11/massachusetts_provides_evidenc.html

If health care costs continue to increase after 2013, then either subsidies will need to increase or near-poverty people and the slightly beter off will have to pay more, breaking through the 12% of income for some and eventually many. I don’t see why assuring the latter doesn’t happen shouldn’t be in a final bill.

Here is another diary I wrote where I calculated the expected out of pocket cost difference this provision would produce over the first five years under some basic assumptions. http://www.dailykos.com/story/2009/10/19/794991/-Affordability-Problems-in-HCRMiddle-Class-Screwed!-

In short, a family making 40k would go from paying 8% out of pocket for their premiums in 2013 to paying 10% out of pocket just five years later.
See the diary for the calculations.

oh great – now you are referencing gruber who is using AHIP numbers to support your position? did you not just recently, and rightly, say anything from AHIP should be suspect?

this report is also suspect for several other reasons. first, as i live in MA and shop carefully for insurance, i can tell you flat out for a fact that other than the first year of reform, my premiums have gone UP not down 40%. the first year they staid the same, but prescription drug coverage was added. i consider that a cost decrease.

second, the report looks at averages – since the risk pool has changed with the reform, and it looks like the numbers are not adjusted for age, etc (am i wrong on that?), it may be that the report is comparing the average of two distinct populations. it may also be that well people are choosing low premium (high deductible, high copay) policies as a cost saving measure due to the economic contraction.

finally, the 2006 MA reform is nothing like what is being proposed now for the nation, as we ALREADY had guaranteed issue, and community rating prior to 2006. when these reforms are implemented nationwide, expect premiums to go UP, as insurance companies will have to keep customers with pre-existing conditions and in need of expensive healthcare.

skimming the link, i see no evidence that any of these issues were taken into account. has anyone looked more carefully at the report?

No, none of those issues was dealt with in Gruber’s brief piece. Thanks, very interesting and useful comment!

Hey, we’re talking ’bout a 1990-page bill at this point, don’t be so hard on Jason. Who has the needed speed-reading skills?

Great Daily Kos article; you and the CBBP got the numbers.

And wait till the absolutely necessary massive cutbacks on everything (except the military) kick in in a few years, because of what the financial elite will want us to believe is _the_ critical crisis, the one involving the budget deficit.

Right, after reform kicks in, which is in this case 2013. Gruber seems to be saying that after Exchanges kick in, premiums decrease, and points to CBO documentation that seems to agree. This is all gotten from the skimming I’ve done and the excerpts I’ve seen, but interesting points nonetheless.

I’m not sure what the predicted premiums are for the exchanges, but it seems to me that the whole point of reform was to make premiums in the individual market much more affordable by creating a larger pool (the exchanges). If we didn’t think that would make premiums more affordable (even without subsidies), I don’t think it would be put forward as the centerpiece of reform. The cynical take is that the whole exercise is just a tax and spend government program to help people buy extremely expensive insurance — and everyone is forced to buy it. This gives more people insurance than would otherwise have it and it gives private insurance companies higher profits than they otherwise would have. Sounds like a win-win until you realize the level of taxation and spending that would be necessary to continue funding the subsidies if costs never got under control. So the most likely outcome is one of two possibilities. Individual market premiums do not fall much after reform starts, but they grow slower in future years as a result of the exchange. Or, the baseline individual market premiums actually go down once the exchanges go up and then they grow at a slower rate than they would have without reform. If one of these do not happen, reform will be an epic failure and we will have bigger problems to worry about than how the subsidies are indexed.

David, I don’t think people will be jailed. The outcry will be too great. The mandates just won’t be enforced. People just won’t have insurance. It’ll be just another failed Washington reform proving the Republican lesson that Government programs never work, and the deaths, bankruptcies, and foreclosures will continue.

New CBO analysis of the House bill states that out of pocket costs for people in the exchange WILL grow over time as a result of this indexing strategy.

 The estimated costs of providing subsidies through the new
insurance exchanges are now lower for several reasons: the larger
expansion of Medicaid means that fewer people would be eligible
for coverage through the exchanges; the shares of income that
enrollees would have to contribute toward their premiums in 2013
were increased; and those shares were also indexed so that they
would rise gradually over time (meaning that federal subsidy
payments would grow somewhat more slowly than those under
H.R. 3200).

So it seems that the CBO is assuming premium growth in the exchanges rather than premium decrease (since the out of pocket costs are translated into a percentage of premiums after the first year according to the legislative language)

the results have been an enormous reduction in the cost of non-group insurance

Well duh. That stuff has insane markup, but what about the costs of group insurance?

A public option, but not a robust one.

The US re-introduced Dickensian debtors prison for men who had no ability to pay CS. It’s obscene but it is the law.

I believe this is indexed to inflation, actually.

Yeah, group insurance not so much. The MA reform was targeted to increase coverage so I don’t think that overall cost containment was central to the effort. Mitt Romney said as much the other day in defending the reforms. Also note that MA does not have a PO.

How so? Here’s what the bill says:

INDEXING.—For years after Y1, the Commissioner shall adjust the initial and final premium percentages to maintain the ratio of governmental to enrollee shares of premiums over time, for each income tier identified in the table in paragraph (1).

For the first year out of pocket costs are pegged to a percentage of your income. This is then translated into a percentage of the premium which you have to pay for. The language above says that credits will be adjusted to maintain that premium ratio over time in terms of what you have to pay vs. what the government is paying.

Scary, especially if the cost control efforts — if there are any left in the final bill (and for a bill of this size who will know except lobbyists and friends?) — fail.

My mistake, I’m getting mixed up in my terms. Confusing stuff, sometimes.

Ok, so, fairleft is concerned that rising premiums will mean people will have to pay more out of pocket in the Exchange as time goes on. You are pointing out that subsidies may indeed be indexed to premium inflation, meaning fairleft’s concern is addressed. Of course, this also means government might end up shoveling money to insurers to help offset huge inflation. But Gruber and the CBO seem to think premiums in the Exchange might reduce overall, or at least not grow as fast as they would otherwise:

The Congressional Budget Office (the official government scoring agency) reported that they estimated the cost of an individual low-cost plan in the exchange to be $5,300 in 2016. This is a plan with an “actuarial value” (roughly, the share of expenses for a given population covered by insurance) of 70 percent. In their September 22 letter to the Senate Finance Committee, the CBO projected that, absent reform, the cost of an individual policy in the nongroup market would be $6,000 for a plan with an actuarial value of 60 percent. This implies that the same plan that cost $6,000 without reform would cost $4,540 with reform, or almost 25 percent less.

So seems like we’re ok, or at least better off, no?

No no, I am not suggesting that fairleft’s problem is addressed I am suggesting that his concern is well founded — provided that premiums INCREASE over time in the exchanges. If this occurs, since the subsidies are tied to premium inflation not wage inflation an individuals out of pocket cost will increase over time. However, if Gruber’s analysis of MA is correct and we can expect premiums to decrease for individual market plans in the exchange over time, then the problem fairleft is concerned about will not be so serious. Very confusing, but that is the situation in a nutshell I think.

Hi fairleft, Thanks for highlighting my point and thanks to you and Jason for discussing it and discovering my error. Let me parse the quote and be precise about the error.

“Also, the health care subsidies provided in the bill, are not tied by the legislation to inflation in private insurance premiums. So, as the years pass, this bill will provide mandates for individuals to buy insurance, but subsidies that are inadequate to fund private sector premiums.”

I think I’m correct to conclude, based on what you say just above, that if, in the years, after 2013 insurance continues to inflate, that this first part of the quote remains correct.

Jason questions whether there will be continued inflation however, and cites some policy wonks with good credentials to the effect that prices will be driven down in the exchange over a period of ten years. Their analysis however, is based on CBO work the full details of which have not yet been released. Their conclusion is also based on the experience in Massachusetts where premiums for non-group policies have been drastically reduced.

The Federal Exchange may work in the same way as Massachusetts, but it also may not. To learn more about this we’d have to compare the level of concentration in the insurance market versus the level of concentration in the national insurance market, and the likelihood that there would be the same kind of competition in that National Exchange as their evidently is in Massachusetts.

Regarding the second part of the quote:

“This situation may even exist in 2013, since the lack of price controls in the bill almost guarantees that by the time the exchange is operative, insurance premiums will have risen 40-50% over today’s prices.”

there’s good reason to believe that premiums will rise as I’ve indicated in the interim period before there is an exchange. That will affect what people actually have to pay for insurance and therefore its affordability in 2013.

For example, take a family of four with parents at age 40 having an AGI at of 400 percent of poverty or $88,200 with a family policy costing $7548 annually right now. That’s about 8.6% of the family’s AGI. Now let’s assume premium inflation of about 45% between now and the operative date of the exchange. The premium cost would then be $10,945, assuming no increase in the family’s income. The family would have to pay 12% of its AGI for the insurance under the mandate which is $10,584, with the Government providing the balance through a subsidy of $361. So, for some families price inflation by 2103 will mean that they will have to pay a greater percentage of their income due to price inflation.

Jason and fairleft also say that they both think the 12% level is too high and should be changed. I agree but note that with the increasing concern among Democrats about deficits, I doubt that the percent of income level will be lowered in the final bill.

But Jason, as you well know eligibility for the PO is severely constrained in this bill, so how will the competition work?

Thank you for clarifying matters. This was a good diary to do even though I admit I wasn’t fully informed and probably never will be about the delicate intricacies of the semi-final bills. I don’t think I am or will be the only one, but I will keep an eye on and try to shout about what the mandatory costs will be for not very well off taxpayers.

The amount of the subsidy in dollar terms will not increase in proportion to increases in premiums. The portion of the premium which an individual expected to pay out of their own pocket will be held constant over time in comparison to what the government will pay. That means that if a first year out of pocket expense for a family making 40k per year is $3,200(8%) and the average premium in year one is $10,656, this family is paying 33% of the premium and the government is paying 77%. What the legislative language implies is that this ratio will remain constant no matter how large the premium grows. In years 2-5 he will continue to pay 33% of the premium in each year based on the cost of the middle tier (silver?) plan in that year. So if the cost of the premium goes up, this family will have to pay 33% of a larger amount, increasing their out of pocket expense. See the example in the kos diary I posted above. So their out of pocket expense will be directly tied to fluctuations in premiums, not to their ability to pay (based on a percentage of their own income). Perhaps this is fair considering that this is what non-subsidized folks will be faced with as well. But the difference is that people will be forced to buy insurance and can not refuse without being fined. That is why it is so important to make sure that there is an affordable minimum quality plan offered in the exchange if an individual mandate is in place.

If one makes more than 88,200 it will be less than 12% at least in 2013. If one makes $66,150, then it will be 10%. But those making $88,200 may be much better able to afford their 12% than people making $66,150 will be able to afford their 10%. At 200% of poverty or 44,100 the percentage is only 5.5%, but that amounts to $2426 annually, a stiff expense if you have a family of four making $44,100. I really think people won’t think this reform is affordable at all, whatever Congress and the Administration says.

Here’s one that’s even more obvious. Control the price of health insurance. Make it illegal for the companies to raise prices more than the overall national rate of inflation. That should be part of the present bill. The sunshine provision is ridiculous. It’s window dressing for fools. It’s the kind of thing Congress does because it thinks everyone else is stupid.

Economists are most ofte wrong in their forecasts, especially CBO economists. Let them expose the models to critcism, and let’s have price controls to make sure they’re not wrong.

Take that Massachusetts figure with a big grain of salt. Remember the figure came from AHIP. Also, we haven’t seen the models. ten year econometric models normally stink because the assumptions don’t hold and the relationships are non-linear, not linear as the models assume.

Kevin Zeese is largely right, though I think his estimate of inflation between now and the time the exchange takes effect sometime in 2013 is low. Using 10% per year compounded and assuming that the operative date is sometime in the middle of 2013, the percent inflation is 1.397, or very close to 40%. With the extra 25% the private insurers will be able to charge those in the high-risk pool and assuming that millions of people are in that pool we have inflation somewhere between 40% and 50%.

Anything AHIP releases right now should be severely questioned, and can’t be taken at face value. is it plausible to you that health insurance premiums increased by only 14% country wide in 2.5 years? It seems way off to me, since we’re hearing about insurance companies asking for 18% annual increases now. However, even if it’s accurate, we are now seeing much larger price increases and the new reform bill is about to make the companies forego rescissions, and also cover their fair share of of the uninsured and those denied due to preconditions who enter the high-risk pool. The companies will respond to these reforms with substantial price increases in order to hold their profits.

As for Massachusetts, the Kaiser Family Foundation just published some results which showed that the average cost for an individual policy in the United States is currently $4824. Now the price in MA in 2006 may have been $8537, and may be at $5143 now, but what are the chances that the price was 100% more than the national average in MA in 2006? Pretty small, I think. Either there’s some kind of error here, or there’s some special reason why it was so high. That reason, which may have nothing to do with the exchange, may also explain why the price fell to a level which is still 7% above the national average currently, when their program was introduced.

In short, I’m very suspicious of what Gruber reports and would like to see more detailed analysis before we except these all too convenient results at this stage of the health insurance reform debate.

fairleft, I think you’ve got this backwards. The results, if true, are encouraging for the period after the exchange is operative, but not for the band-aid period when there won’t be any competition.

But not a robust one, Jason.

The definitive critique of the link so far.

I agree. That’s one of the worst things about the bill. We can be pretty sure that insurance company lobbyists had their say in drafting it. There are probably many obscure provisions in there that screw the public which no one has discovered yet. Give me the 30 page HR 676 anyday of the week. None of that is obscure.

That won’t happen David. The program will just fall of its own weight. Nothing else is politically realistic.

The average cost now according to Kaiser is already $4824. Does anyone really find it plausible that the cost in 7 years will be only $5300, an increase of less than 10% in seven years. That’s way below any reasonable average rate of inflation. CBO may be right, but their result is very implausible. Anyone know when the last time was that they got a 7 year forecast right?

I’ll keep an eye out too.

I think there will be increases, but I think they won’t be as much as the health care inflation we’re seeing now. Of course, economists can be wrong, but they make good points and have shown their work, so it’s worth noting.

As for the PO and competition, all we’re talking about here is competition in the Exchange, which is free. The entrance requirements for the Exchange are indeed high, but for the pool in the Exchange (individual and small business markets), the competition is there and it is real.

The possibility that premiums would go down for individual market purchasers in the exchange was raised by me in this thread as a way to find a legitimate explanation for a truly baffling provision that is in all versions of HCR that are on the table. I was wondering if there was some decent reason why the house bill and the HELP bill both included this manner of indexing. It’s not just a Finance Committee screw job. When Jason brought up the idea that premiums might go down I thought that may be the answer I was looking for (so that I do not become completely disillusioned with the entire watered down bill). But things like this make it increasingly difficult for me to explain to people why we will be better off even with the bill as shitty as it is. So whether AHIP’s numbers are correct or Gruber’s analysis is sound is not the central point of this thread. I assume, and the CBO’s analysis seems to imply that premiums will increase in the exchanges over time. So ultimately fairleft’s and my own concern about this provision seems to be justified. I hope we can push for more awareness of this provision…

what are the chances that the price was 100% more than the national average in MA in 2006?

that part i think is quite possible, because we had regulation (that as far as i can tell is actually enforced) BEFORE the 2006 reform. no rescission, guaranteed issue (with some limitations iirc on the length of time one could be uninsured without a wait period for pre-existing conditions), and community rating were all in place before 2006.

making the insurance companies insure people who need lots of healthcare IS expensive.

as far as i can tell, the exchange in MA is useless. every year i check the policies in it and out of it, and always end up with a policy from outside the exchange.

i was only harsh because of a prior thread where i thought… well, judge for yourself:
http://seminal.firedoglake.com/diary/11991

I agree that there will be competition in the exchange. But it is limited, and, as you know, the PO will be at a disadvantage because it is starting from scratch and its initial size will be small, making it less likely that it will be able to get services from the providers at competitive prices, and also that it will be able to develop a quality network of providers that can compete with the big players.

While I certainly agree that we need to note what the economists have to say, we also need to need to be very careful and critical of their work because their track record in long-term forecasts is not very good in situations of dynamic economic change. These days the economy forming the background of their forecasts is very volatile and the assumptions that underly their forecasts are therefore much more questionable than usual.

On top of that the economist you’re quoting is using AHIP data, and we don’t know what relationship Gruber has to AHIP. Until we’ve checked over the data and no something about how it was generated and also know what Gruber’s status as an independent researcher with no agenda is, we ought to accept his claims with skepticism.

selise, good points, as usual. But I still need to ask, what was the real causal factor in the fall of the average price from $8537 to $5143, since clearly the insurance companies companies could always afford such a reduction? Should we believe it was just the start of the exchange, or could other factors be involved? Forgive my skepticism. But in policy debates analysts are always mistaking association or correlation for causation, so I’ve learned to be very careful about accepting claims of this kind.

Suggesting perhaps that it was not the exchange that caused the price drop from $8537 to $5143?

I did. You and a few others did a terrific job on that that thread. I wonder why the comments have been closed so early.

The most interesting part of Gruber’s report, for me, was the CBO catch, with CBO admitting, if you’re reading between the lines because they don’t want to say it out loud, that premium growth overall would start slowing.

i don’t think that price drop reflects premium costs going down. they just haven’t. last summer when i signed up again with the same carrier (bcbs) after going through all the policies available to me again, for the same coverage i had to pay almost 20% more than the last policy i signed up for (a little more than a year prior). that’s why i think there must be something changing with the population ahip is taking the average of. what i’d like to see are paired data (same policy for same person of same age, sex and location) for comparisons. may for each year over the last 10 years in comparison to a baseline year.

i think there is something seriously wrong. which was why i asked all those questions above about how the data was gathered and analyzed.

cms report predicts increase in cost (total national health expenditures) and no cost control (this is for the tri-committee version of hr 3200, already watered down).

premiums can go down for lots of reasons, including increased cost sharing (deductibles, copays, coinsurnace) and are not a good measure of healthcare costs.