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Exchange premiums: Subsidies and real costs

June 22. 2014 9:51PM

According to the U.S. Department of Health and Human Services, the average monthy health insurance premium on New Hampshire’s health insurance marketplace is less than $100. Except it is not.

Some headlines proclaimed last week that the “average” monthly premium on New Hampshire’s exchange was just $87 per month. In truth, that was the average, after government subsidies, for the most popular “silver” plan. Across all plans, the average was $100 per month for people who qualified for a federal subsidy. The average cost before the subsidy was $390 per month.

This is how Americans can be so easily misled about Obamacare. The average premium cost on New Hampshire’s exchange is not $100. It is $390. The taxpayers pick up 2/3 of the tab for people who earn up to 400 percent of the federal poverty level. Nationally, the taxpayers pick up 3/4 of the tab, the HHS report shows.

Obamacare is not pushing premiums below $100 by actually lowering the cost of health insurance. It is lowering the price of insurance for people who earn less than 400 percent of the federal poverty level simply by taxing others so the government can pay the bulk of the costs, making the premiums appear cheaper than they really are.

That is not a reform; it is a shell game.

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