The dirty secrets behind Boehner’s ‘spiking’ Obamacare premiums

Perhaps in an effort to defuse reports that House Speaker John Boehner is making out pretty well as a first-time insurance customer under the Affordable Care Act, Boehner’s office put out the word this weekend that his family healthcare premiums will be much higher next year than now.

That outstanding stenographic service, Politico.com, swallowed this story whole. “John Boehner’s premiums spike under Obamacare,” Politico declared in a Sunday piece. The article quoted Boehner’s spokesman, Brendan Buck, as lamenting: “The Boehners are fortunate enough to be able to afford higher costs. But many Americans seeing their costs go up are not. It’s because of them that this law needs to go.”

Well, not really. Boehner’s spiking premiums is one of those claims that may be true as far as it goes, but leaves out so much that it’s at best a half-truth. And the contention that Boehner’s experience is at all representative of what most Americans will experience under the Affordable Care Act jumps it up from half-truth to outright lie.

Let’s look at the numbers, which Buck confirmed for me. In 2013, Boehner and his wife, Debbie, were jointly covered by the Federal Employees Health Benefits program, like all federal workers on and off Capitol Hill. They paid a monthly premium of $433 for a Blue Cross Blue Shield health plan covering both of them with deductibles of $350 per person.

Next year Mrs. Boehner will be on Medicare. So the speaker shopped for a 2014 individual health plan for himself on the Washington, D.C., insurance exchange, which is where members of Congress and their employees have to go as of Jan. 1. (The government’s Office of Personnel Management is requiring Congressional applicants to use the DC exchange’s portal for small businesses, rather than for individuals; the offerings on both are roughly similar though there are more choices on the small business side.)

There, Boehner’s spokesman said, he found a “comparable” gold level Blue Cross Blue Shield plan with a $1,000 deductible and a monthly premium of $449. Combine that with Debbie Boehner’s Medicare premium of about $400, and it sure looks like they’re getting rooked.

But there’s much more to the story. In the first place, Boehner’s premiums are partially covered by his employer, the federal government, which pays up to 75% of employee premiums, up to a cap of $426.14 a month (for 2014). Boehner’s premium would be $875 a month next year otherwise.

Why is it so much higher than his family premium this year? The main reason is Boehner’s age. His federal group insurance, like the typical large group plan, didn’t charge different premiums by age. Individual plans under Obamacare may do so, as long as they don’t charge their oldest customers more than three times their youngest.

Boehner is 64, which means he’s the oldest anyone can be in the individual insurance market before moving into Medicare. That alone makes a big difference in his rate. If he were 50, for example, the same plan he’s chosen for next year would carry a full premium of only $459 a month; his government employer would cover $344 of that, leaving him with a premium of only $115 a month, lower than the $190 he’d be paying in the federal employee program. In fact, as a 50-year-old he could choose a zero-deductible plan costing $596, which would make his premium $170--still less than he’d be paying under the federal program, and with a lower deductible! Good deal!

For a 40-year-old, the news would be even better: He or she could choose a $1,000 deductible for only $333, or $83 a month after the employer’s share is calculated. And a zero-deductible plan woul cost that worker or Congress member a mere $101 a month, almost half this year’s cost for the traditional federal employee plan. That’s a better deal under Obamacare.

By the way, more needs to be said about Mrs. Boehner’s premiums, which the speaker’s office mournfully says will total $350-$400 a month for Medicare parts B and D. What Boehner’s office doesn’t mention is that Medicare premiums are based on income. For married couples filing jointly and income below $170,000, the premium is $105 a month; the maximum, for couples reporting income over $428,000, is $336. Add a drug premium, which could range from $12 a month to more than $100, depending on income. John Boehner collects $223,500 as speaker and his wife has her own real estate job; that might well peg her Medicare premiums at the top end.

Put it all together, and Boehner is plainly an outlier as an Obamacare client. He’s way older than the average individual policy applicant, and his family income is way beyond the U.S. average. Boehner gets a further break as a smoker--under the law, the state exchanges could charge as much as 50% more for them, but D.C. is one of the few that has decided not to.

But the real lie at the heart of Boehner’s claim is that the typical Obamacare customer is someone transitioning from a good employer plan to the individual market, as he is. The truth is that two-thirds of all the users of the individual insurance exchanges nationwide are expected to be people who didn’t have any insurance previously, either because they couldn’t afford it or because they were barred by pre-existing conditions. As an enrollee of the federal employee system in 2013, Boehner couldn’t be barred for pre-existing conditions, and Obamacare has outlawed such exclusions for individual policies starting in 2014.

The real alternative for most people using the individual exchanges is not employer coverage, as it was for Boehner, but no coverage.

Boehner has only his congressional colleagues to blame for his having to use the insurance exchange at all--the Senate GOP mandated that members of Congress and their staffs, uniquely among federal employees, move their insurance to the exchanges. And now they’re complaining about the complexity and cost? That’s gall.

What Boehner’s experience underscores is that for the vast majority of individual insurance customers, the Affordable Care Act is a real plus. That’s true for John Boehner and his congressional colleagues, and it’s about time they stopped complaining--and lying--about it.