SCATHING AP FACT-CHECK: ‘ANOTHER YEAR, ANOTHER ROUND OF EXAGGERATION FROM PRESIDENT BARACK OBAMA…’
Editor’s Note: The following is a fact check written by the Associated Press entitled, “Fact Check: Obama Spins Health Insurance Rebates.”
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WASHINGTON (AP) — Another year, another round of exaggeration from President Barack Obama and his administration about health insurance rebates.
In his speech defending his health care law Thursday, Obama said rebates averaging $100 are coming from insurance companies to 8.5 million Americans. In fact, most of the money is going straight to employers who provide health insurance, not to their workers, who benefit indirectly.
Obama danced around that reality in remarks that also blamed problems in establishing affordable insurance markets on political opponents, glossing over complex obstacles also faced in states that support the law.
President Barack Obama stands with families who benefitted from the health care law provision that provides consumers with a refund if their insurance company doesn t spend the majority of premium dollars on medical care as he speaks about health care reform and the Affordable Care Act in the East Room at the White House in Washington, Thursday, July 18, 2013. Credit: AP
A look at some of his claims and how they compare with the facts:
-”Last year, millions of Americans opened letters from their insurance companies. But instead of the usual dread that comes from getting a bill, they were pleasantly surprised with a check. In 2012, 13 million rebates went out, in all 50 states. Another 8.5 (million) rebates are being sent out this summer, averaging around 100 bucks each.”
- After introducing several people who got rebate checks last year: “And this is happening all across the country. And it’s happening because of the Affordable Care Act. Hasn’t been reported on a lot. I bet if you took a poll, most folks wouldn’t know when that check comes in that this was because of Obamacare that they got this extra money in their pockets. But that’s what’s happening.”
-”If they’re (insurers) not spending your premium dollars on your health care – at least 80 percent of it – they’ve got to give you some money back.”
THE FACTS: Just as he did a year ago, Obama made a splashy announcement about rebates that incorporates misleading advertising.
The health care law requires insurance companies that spend too much on administrative expenses to issue rebates to customers. But those customers are often employers that in turn offer insurance to workers and bear the bulk of the costs. In workplace plans, the rebate goes to the employer, which must use it for the company health plan but does not have to pass all or part of it on to the worker. People who buy their own insurance and qualify for a rebate get it directly.
Obama was on solid ground in saying “millions of Americans” got rebate checks last year, but the number was not close to 13 million as he implied.
Of the 12.8 million rebates announced last year, health policy experts estimated 3 million would go directly to the insured. The government didn’t know how many.
President Barack Obama stands with families who benefited from the health care law provision that provides consumers with a refund if their insurance company doesn t spend the majority of premium dollars on medical care as he speaks about health care reform and the Affordable Care Act in the East Room at the White House in Washington, Thursday, July 18, 2013. Credit: AP
Nearly two-thirds of the 12.8 million were only entitled to pro-rated and decidedly modest rebates, because they were covered by employers that pay most of their premiums. Workers typically pay about 20 percent of the premium for single coverage, 30 percent for a family plan. Employers pay the rest.
And employers can use all the rebate money, including the workers’ share, to benefit the company health plan, perhaps restraining premiums a bit or otherwise improving the bottom line. The law requires insurers to spend at least 80 percent of premiums they collect on medical care and quality improvement, or return the difference to consumers and employers.
Altogether, this year’s rebates are worth $500 million, down from $1.1 billion returned last year. The government says the lower rebates mean insurance companies are becoming more efficient.
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CLAIM: “I’m curious, what do opponents of this law think the folks here today should do with the money they were reimbursed? Should they send it back to the insurance companies?”
THE FACTS: Even in that unlikely event, most people could not send it back to insurance companies because the money doesn’t go “in their pockets” and they have no control over what their employers do with it.
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CLAIM: “In states that are working hard to make sure this law delivers for their people, what we’re seeing is that consumers are getting a hint of how much money they’re potentially going to save because of this law. In states like California, Oregon, Washington, new competition, new choices, market forces are pushing costs down.”
THE FACTS: It is simply not known whether health insurance will become less expensive in those states — or nationally — than it is now, or than it would have been absent the law. And hitches in setting up the new insurance marketplaces called exchanges are not limited to Republican-led states where leaders object to the law, although that political pushback is certainly part of what’s going on.
President Barack Obama applauds before he speaks about health care reform and the Affordable Care Act in the East Room at the White House in Washington, Thursday, July 18, 2013. Credit: AP
In California, for example, where there is plenty of competition by health insurers wanting to get into the exchange, an actuarial report commissioned by Covered California, the state agency running the insurance marketplace, found that middle-income residents could see individual health premiums increase by an average of 30 percent while costs go down for lower income people.
In West Virginia, Democratic Gov. Earl Ray Tomblin — also a cooperative partner in expanding Medicaid and setting up an exchange — complained to federal officials this week about delays in rules and guidelines from Washington as the state struggles to meet deadlines under the law.
“Many West Virginia families have expressed frustration” trying to find out how much policies from the exchange will cost them and whether they will get a subsidy, he said, and the state is “dangerously close” to falling short of requirements under the law.
Fact-checking…
ReplyDelete”Last year, millions of Americans opened letters from their insurance companies. But instead of the usual dread that comes from getting a bill, they were pleasantly surprised with a check. In 2012, 13 million rebates went out, in all 50 states. Another 8.5 (million) rebates are being sent out this summer, averaging around 100 bucks each.”
This is true. This guy is talking nonsense. If you own a business and are an American, you got the check from your insurance company. You got the letter, you opened the letter, you saw the check. Obama's statement is correct: 13 million Americans (either individual policy holders or office secretaries) opened the letters and received the rebates.
He says, "Even in that unlikely event, most people could not send it back to insurance companies because the money doesn’t go “in their pockets” and they have no control over what their employers do with it."
So what? The rebate goes to whomever paid the premium -- whether individual or employer. If somebody else purchases something for your benefit and gets a rebate because he was ripped off by the seller, the rebate SHOULD got into his pocket, since he was the one who paid the money in the first place. And whomever gets the rebate can do with it what he pleases, whether he is a business or individual -- money is fungible. The employee's contribution to health insurance is unchanged by the rebate, regardless whether the employer chooses to apply the rebate money to next year's health insurance or some other purpose.
He says, "It is simply not known whether health insurance will become less expensive in those states — or nationally — than it is now, or than it would have been absent the law."
Absolutely false. In all those states Obama mentioned, the insurance companies have already submitted their rates for the exchanges.
If this is the best this guys can do, he should just remain silent.
--David
Deletethe proof will be what happens, not the first year but over time. Initial rates might be artificially low to get the publicity, but when reality hits--hold onto your pants!
"Not all rebates will come as checks in the mail. Companies have the option to refund credit cards used to pay premiums, or discount future premiums."
ReplyDeletehttp://thechart.blogs.cnn.com/2012/07/27/checks-come-as-surprise-under-obamacare/
Ha! Obama missed this one! Not all those people got to open an envelope to get their money back. The dastardly Obama is tricking us.
This guy must not know it, either, or else he probably would have added it to his list of horrible lies!
Since employees pay a percentage of the annual premium charged their company, they would actually pay less in premiums the year after the rebate, if United Healthcare chooses by pay the rebate by discounting future premiums. Okay, so that's not exactly money "in your pocket," but is is money the employee saves. If this guy wants to get into petty hair-splitting semantics, we can all play the game.
--David
Most companies do not accept credit cards for premiums, after the initial payment.
ReplyDeleteThe refunds that these people have received in the article were $8 to $20 per month--big deal! When the premiums were significantly higher.
The reason that health insurance has increased in price is all the government involvement. ObamaCrapCare will make things even worse.
"Most companies do not accept credit cards for premiums, after the initial payment."
ReplyDeleteOkay, but still true that some of these people who used credit cards did not get a check in the mail.
"The refunds that these people have received in the article were $8 to $20 per month--big deal!"
Actually, it was $1.1 billion in 2012, and the average was $151. Interesting that 92% of the people in Texas buying in the individual market got rebates -- highest in the country. Someday, I am going to post a long thread about Rick Perry and the Texas healthcare system -- worst in the country. He wouldn't matter so much if Texas were not such a large population state. He should do what California and New York are doing. Texans are suffering and he doesn't care, because he still thinks he can run for president (despite already showing us in the primary last year that he is a total buffoon!).
"The reason that health insurance has increased in price is all the government involvement. ObamaCrapCare will make things even worse."
False. The premium growth rate has decreased since Obamacare because of the increased competition and regulations (such as the 10% rule). That is a fact. It is far from the perfect solution, but still better than reverting to the phenomenal premium growth over the last 20 year pre-ACA caused -- not by Obamacare -- but by the health insurance industry oligopoly.
--David