Thursday, December 3, 2009

Magical math

(i need a little cheering up. i think i'll go visit my other blog)

I was just over at the Health Care For America NOW Blog, where I learned that - yippee - the CBO has confirmed that the Senate Bill will, in fact, lower health insurance premiums!

Birds are singing. The flowers are in bloom. All is well with the -

Wait a second. What is that hidden in the middle of the blog post?

It's magical math!

The post quotes Ezra Klein from the Washington Post. Here is the quote. See if you can spot the magic. I'll highlight it for you to make it easier to spot.


The CBO estimates that 57 percent of people in the individual market will receive subsidies to help them purchase health-care insurance (folks on the individual market tend to be much lower-income, with much less stable employment). Those subsidies will reduce premium costs by between 56 to 59 percent for the average beneficiary. So in the final analysis, the effect of reform on your typical individual market purchasers is to give them insurance that's about 30 percent better but only 10 to 12 percent more expensive, and then assure them subsidies that will lower their payments by more than 50 percent. And if you're in the small group or large group markets, your premiums are expected to fall a bit.


Why oh why do people keep insisting that subsidies will decrease costs?? Subsidies will not lower health insurance premiums. They will simply shift the expense to the taxpayers.

Furthermore, are we seriously supposed to believe that if we're in the small group or large group markets, our premiums will "fall a bit"? I love the way Ezra threw that in at the end. Very funny. When was the last time the insurance companies lowered premiums for anyone??

There really is no hope for cost containment if the Senate plan does not include:

a) Repealing the anti-trust exemption for insurance companies

b) A public option that is open to everyone

and c) Brain transplants for all of the health insurance company executives who think their job is to generate profits regardless of the health of their customers. Oh wait. That IS their job. Never mind.

There really is no hope for cost containment. (I'm getting a little discouraged about the whole thing, can you tell?)

Interestingly enough, on the same Health Care For America NOW blog, there is a link to this story:

Aetna Prepares For Loss Of 600,000 Members As It Raises 2010 Prices

Chair and CEO Ron Williams told analysts, "The pricing we put in place for 2009 turned out to not really be what we needed to achieve the results and margins that we had historically been delivering."


Let me get this straight. A big insurance company raises its prices, deliberately driving hundreds of thousands of customers away, in order to achieve a bigger profit margin.

Now THERE is some math I can believe in.



  1. Lesley, i have decided, i ain't gonna have no health no more, healthy or not, just gonna stay confused and become a senator insted.

  2. Bob: I'm with ya! I'm running for governor of Texas, have I mentioned that lately? LOL

  3. I posted this comment once before and it disappeared - kinda like the public option. This whole mess is depressing. I guess I am going to have to live out of a box in order to afford my medicine. I am certainly not going to be able to afford insurance and a mortgage.

  4. Another good post! But don't forget tort reform. That has a great impact on health care costs.

  5. Rae: The insurance companies came out with yet another study, saying rates will increase under health reform. No kidding. Like they wouldn't increase anyway. Argh. I feel your pain.

    Lily: How could I forget? Tort reform MUST be the answer!! LOL