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Wednesday, October 28, 2009

Updated: WSJ: Public Option Could Triple Insurance Premiums

Democrats claim that the public option will not increase people's current insurance premiums. However, a new study by Wellpoint shows that some insurance premiums could actually triple under the health reform legislation:

At the request of Congressional delegations worried about their constituents—call it a public service—WellPoint mined its own actuarial data to model ObamaCare in the 14 states where it runs Blue Cross plans. The study therefore takes into account market and demographic differences that other industry studies have not, such as the one from the trade group America's Health Insurance Plans, which looked at aggregate national trends.

In all of the 14 states WellPoint scrutinized, ObamaCare would drive up premiums for the small businesses and individuals who are most of WellPoint's customers. (Other big insurers, like Aetna, focus on the market among large businesses.) Young and healthy consumers will see the largest increases—their premiums would more than triple in some states—though average middle-class buyers will pay more too.

In the spirit of full-disclosure, Wellpoint is an insurance company and has their own agenda in this debate. Democrats made this perfectly clear in their response to this report:

"This is yet another insurance-industry report that twists the facts to produce a skewed result," averred Linda Douglass, the White House communications director on health care. Said a spokesman for the Senate Finance Committee, "This is akin to the tobacco companies commissioning another study claiming nicotine isn't addictive and cigarettes don't cause cancer."

You may have to take this report with a grain of salt, but it is still some pretty damning results. It is a very detailed with a lot of stats and analysis to back it up.


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