August 13, 2013 11:26AM

The New Republic: Obama Kinda Lied a Little about Obamacare

On Monday, The New Republic's Jonathan Cohn admitted that President Obama "made a misleading statement about Obamacare rates" during his press conference on Friday. The magazine's Twitter feed (@tnr) announced:

Whoops! The president (accidentally, we think) told a little #Obamacare lie on Friday.

During his press conference, the president said:

[When it comes to people without access to employer-sponsored coverage,] they're going to be able to go on a website or call up a call center and sign up for affordable quality health insurance at a significantly cheaper rate than what they can get right now on the individual market. And if even with lower premiums they still can't afford it, we're going to be able to provide them with a tax credit to help them buy it. [Emphasis added.]

The problem, Cohn writes, is that:

while some people will pay less than they pay today, some will pay more. They will primarily be young, healthy men who benefited from preferential pricing in the past, were content with coverage that had huge gaps, and are too wealthy to qualify for the law’s tax credits—which are substantial but phase out at higher incomes...

But somebody listening to Obama’s press conference probably wouldn’t grasp that distinction. They’d come away thinking their insurance will be cheaper next year. For some, it won't be. Obama isn’t doing himself, or the law, any favors by fostering a false expectation.

That's essentially what people like the Manhattan Institute's Avik Roy and me have been saying—though we focus more on premiums for unsubsidized young and healthy folks than Cohn would like. Initially, this was because back in June, California's Obamacare Exchange was giving a completely misleading picture of the premiums those folks would face. And as I explained at that time:

[H]ealthy consumers are the key to the entire enterprise. They are the ones who are vulnerable to rate shock. If they think the premiums are too high, they will pay the small penalty and wait until they are sick to buy coverage. If that happens, premiums will climb higher, more healthy people will drop out, and Obamacare will cause health insurance markets to collapse. Obamacare supporters are in a near-panic that young, healthy people won’t sign up for coverage, and with good reason. 

Back then, Cohn accused Roy of being "irresponsible" and "distorting the debate," and lamented "we can’t have an honest debate about Obamacare" essentially over a question of emphasis. Obamacare opponents emphasize the law's effects on unsubsidized young and healthy people (because of their immense importance), while supporters focus on the law's subsidies (which they see as beneficial and sufficient to prevent markets from collapsing). 

The president, on the other hand, stood before millions of Americans and told them Obamacare will not increase but reduce their premiums, even though he knows or should know that is not true. Imagine the outrage if Roy or I told our relatively tiny audiences that under Obamacare, absolutely no one would see their premiums fall.  

If you want to know why we can't have an honest debate about Obamacare, consider how Barack Obama has irresponsibly distorted that debate (for four years and counting). I hope Cohn keeps demanding greater honesty from the president, and that other Obamacare supporters follow Cohn's lead.