Editorials on Premium Increases
Wanted to pass along this morning’s Wall Street Journal editorial criticizing as “political thuggery” Secretary Sebelius’ letter to insurers last week. The Secretary called reports of carriers planning premium increases to reflect the new mandated benefits in the law “misinformation and unjustified rate increases.” But as the editorial notes, “The White House was always going to blame insurance companies for any cost increases, even when its own policies cause them.…The tone of Ms. Sebelius’ letter suggests that she doesn’t understand that money is exchanged for goods and services, and that if Congress mandates new benefits, premiums will rise.”
The Chicago Tribune reiterates this point in another editorial, entitled “Truth at a Premium:” “Consumers may benefit from these changes, but they don’t come free….When the government forces private companies to provide their customers with more and better services, those companies are bound to raise prices to cover the cost….[Secretary] Sebelius may be able to suppress such information coming from health insurers. But repealing the law of supply and demand will be harder.”
Some may note, however, that the extent to which the health care law raises premiums slightly misses the point. During his campaign, then-Senator Obama promised his health care plan would reduce premiums for family coverage by $2,500 – and by candidate Obama’s admission, that is the standard by which President Obama’s health care law should be judged.