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Fact Check: Heller on health care premiums

This is the first in an occasional series of fact checks written and reported by Review-Journal staff. The purpose of this is to verify the accuracy of statements made by public figures, ad campaigns and political parties.

Each analysis will be corroborated with public documents, data and expert opinions.

The Comment: “There’s nothing in this legislation that will lower premiums,” Nevada Sen. Dean Heller.

Keynotes:

  • Initially, the plan could raise premiums but they are expected to be 30 percent lower than under current law by 2020, according to a Congressional Budget Office report.
  • Lower premiums don’t mean lower costs overall, however. The subsidies under the Senate plan are less generous resulting in people shouldering other costs.
  • Rating: Mostly false

Background: Heller made this comment last month during a press conference with Gov. Brian Sandoval. Heller said he would not support the current form of the Senate bill meant to replace the Affordable Care Act.

The bill, which was released June 22 after weeks of closed-door meetings, has faced unanimous opposition from Senate Democrats as well as pushback from four other Senate Republicans.

Heller was the fifth GOP Senator to oppose the plan. Senate Majority Leader Mitch McConnell said he would delay the vote until after the July 4 recess.

Analysis: According to a CBO report, average premiums for individuals with benchmark plans would be 20 percent higher in 2018 under the Senate plan. CBO projects that this would be because penalties for not having insurance would be eliminated, causing healthy people to not sign up.

CBO has been criticized for a “history of inaccuracy” in this area by the White House, which has said the office has “…consistently proven it cannot accurately predict how healthcare legislation will impact insurance coverage.”

The CBO has consistently estimated the power of the mandate to induce people to sign up for coverage more than other experts, said Charles Blahous, a senior research strategist at the Mercatus Center at George Mason University.

“Without criticizing CBO in any way, it’s fair to believe they might be overestimating the pre-2020 increase in premiums under the legislation,” Blahouse wrote in an email.

While CBO projects an initial increase in premiums, it also predicts that average benchmark plans for single individuals would be 30 percent lower than under the Affordable Care Act by 2020.

“It’s strongly likely that the legislation would lower premiums after 2020, while it’s possible – though by no means assured – that it could increase them prior to 2020,” Blahous wrote in an email.

But lower premiums would also mean the share of services under an insurance plan would be 30 percent lower.

Subsidies under the Senate plan would be less generous, resulting in more people paying more for other costs, said Christine Eibner, a senior economist at the RAND Corporation.

“It’s important to make a distinction between full premium and net premium,” she said. “It is true the CBO score does imply after 2020 that full premiums will fall.”

But there are caveats, she said.

“In general, people who pay low premiums will be low-income, young and poor individuals,” she said. “Middle- to high-income individuals will pay high premiums.”

Follow @kelciegrega on Twitter. Contact Kelcie Grega at kgrega@reviewjournal.com

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