Thursday, February 25, 2010

The Truth About Health Reform and Premiums

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The Truth About Health Reform and Premiums
Posted by Dan Pfeiffer on February 25, 2010 at 01:48 PM EST
If you’re watching the bipartisan healthcare meeting today, you’ve seen some people leaning on a talking point that premiums will increase under health care reform. Let’s be clear: our approach will lower costs for American families and businesses, and slow the growth of costs for the country as a whole.

The non-partisan Congressional Budget Office, the Associated Press and the Wall Street Journal all found that our approach will substantially lower the cost of health care premiums for the vast majority of Americans for three reasons: because it lowers administrative costs, it increases competition, and spreads the cost of health care fairly across millions of Americans.

Under our plan, Americans buying comparable health plans to what they have today in the individual market would see premiums fall by 14 to 20 percent. And most Americans buying coverage on their own would qualify for tax credits that would reduce their premiums by an average of nearly 60 percent – even as they get better coverage than what they have today. This is going to encourage people to purchase better coverage.

And like families and individuals, the CBO found that small and large businesses, who are struggling to remain profitable and competitive under the status quo, will benefit from lower administrative costs, increased competition, and better risk pooling. More than 3.5 million small businesses could qualify for tax credits to help them pay their premiums, and small businesses that are eligible for these tax credits would see their premiums 8 to 11 percent lower than they currently are.

Our plan will end insurance company abuses and provide more affordable options. We must act now, because if we don’t, American families and businesses will continue to feel the crushing burdens of skyrocketing premiums.

The meeting is continuing this afternoon and can be watched here. The President’s health care proposal can be found here.

Dan Pfeiffer is White House Communications Director

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