The Columbus Dispatch piece was confusing, too. Its lede:
Health insurance companies would incur an average 88 percent increase in costs next year to pay for the health care of Ohioans who buy individual policies.
The paper explained that individual Ohioans wouldn’t see their premiums increase that much, partly because many would get tax credits to help pay premiums. Indeed they will, but it’s also highly unlikely a company would increase rates that much either. A look at the list of rate increases requested by Ohio insurers over the last couple of years for individual market policies show high increases, but nothing even close to approaching 88 percent. Most increases were in the teens and low twenties.
Still, the paper told readers that the average cost for insurers would be $420 per month—an increase of 88 percent from $223, which the paper said was the “current average cost to cover medical expenses for an individual health-insurance plan.”
As noted, medical expenses are not the only thing that goes into the pricing mix. And the new policies sold in the exchanges will not be the same as policies sold last year—a point that Taylor did make to reporters. Her comment should have been a clue that a comparison isn’t really possible, and especially a comparison as misleading as one that draws inferences only from unspecified costs.
Columnists on both the left and the right picked up the Ohio insurance department’s misleading message. Jonathan Cohn, writing in The New Republic reported the “Department of Insurance announced that Ohioans buying insurance on their own should brace for premium increases that will average 88 percent next year.” But later in his piece, he said the “88 percent figure is so useless”—because insurance officials paid no attention to the number of people enrolling in plans and did not account for different benefit levels.
In a rebuttal to Cohn, Philip Klein, a columnist for The Washington Examiner began his piece this way:
Ohio Department of insurance officials announced last week that average premiums in the Buckeye state would soar 88 percent once President Obama’s health care law kicks in. The news added fuel to an already raging debate over Obamacare’s effect on insurance costs.
Indeed it did. The department’s press outreach—muddling premiums and costs—may have given birth to a false meme that news reporters and columnists should be wary of passing along.
In the end, it’s the price of the insurance policy to a consumer that matters (along with what is in that policy) and the insurance department was not ready to tell the press what those prices will be.
At least the Dispatch got the headline right: “Insurance prices still unclear.”
They are unclear in most states at the moment, and may be up until close to October 1, when the state exchanges open for business. Passing on spin from state insurance officials does not help ordinary people make decisions, and attributing price increases for insurance (or anything else) to unspecified “costs” does not help the public understand the high price of American healthcare.
Untangling Obamacare: What’s behind the rate increases?