By Jane Norman, CQ HealthBeat Associate Editor
January 28, 2011 -- In advance of a speech by President Obama on the health care law, Health and Human Services officials released a new report that says families will save on premiums as well as out-of-pocket costs.
The issue is key as congressional debate over whether to repeal the law continues and as lawsuits filed against it move through federal courts. Without some kind of slowing in health care costs for both individuals and businesses, it will be difficult for proponents to continue to argue that the law is necessary or that it's the right approach.
Based on Congressional Budget Office (CBO) projections, "In 2014, annual premiums are projected to fall compared to what they would have been without the Affordable Care Act," the HHS report says. "Without health reform, American consumers and businesses would face higher premiums, fewer insurance choices, and rapidly rising health care costs."
The president is scheduled to speak to a national conference of Families USA, an advocacy group that has been a strong ally of the administration during the legislative process and as implementation has begun.
The report comes after a week in which two House committees held oversight hearings critical of the law and a third session before the Senate Health, Education, Labor and Pensions Committee included yet more salvos from Senate Republicans. Democrats are turning to their allies such as the grass-roots network in the states developed by Families USA to help them shape their defense of the law.
The report says that when exchanges are up and running in 2014, a family of four with an income of $33,525 could save as much as $14,900 a year in health care costs because they would qualify for tax credits and reduced cost sharing.
The report also says that small businesses could save up to $350 per family on average because of lower costs through the exchanges and also might qualify for tax credits to offset the costs of health insurance. Large businesses that provide employer-sponsored coverage could save money because of lower health costs brought about by the law, the report says.
Republicans were strongly critical of the report. House Ways and Means Committee Chairman Dave Camp, R-Mich., said that the report would be "laughable if it wasn't so disingenuous." He said a CBO letter upon which the report is based predicted that premiums will rise because a better benefit package will be required for consumers.
Sen. Michael B. Enzi of Wyoming, the top Republican on the Senate Health, Education, Labor and Pensions Committee, said the CBO report showed the net impact of the health care law would be a 13 percent increase in premiums because of the mandated benefit package. "The argument that this new law will decrease premiums demonstrates either a lack of understanding of the CBO report or basic math," said Enzi.
And Karen Ignagni, president and CEO of American's Health Insurance Plans, said the document overstated cost savings and ignored other provisions that will increase premiums such as changes in age rating that will impact younger workers.
