Parsing Obama’s Promise to Lower Insurance Premiums by $2,500 (7/23/2008. Blast to the past)

wall street journal ^ | 7/23/2008 | Jacob Goldstein

[tobyhill]

Barack Obama says his plan to re-tool American health care would “bring down premiums by $2,500 for the typical family.” In a page one story this morning, the New York Times digs into the details behind that promise.

First of all, the article points out, the $2,500 figure includes not only the portion of premiums paid by individuals, but also the large portion paid by employers and, in the case of Medicare and Medicaid, the government.

Given that caveat, what’s the source of the $2,500 figure? It comes from this memo, put out by three Harvard professors who are unpaid advisers to the Obama campaign. They cited RAND findings that investing in health IT could $77 billion a year, and improving management of chronic disease could save another $81 billion. Cutting administrative costs in the insurance industry could save up to $46 billion, the memo said, citing the Commonwealth Fund.

The memo points out that it’s impossible to predict actual savings, and cites a wide range of possible outcomes. But the authors say their best guess is annual savings of $200 billion.

They took that figure, divided it by the population of the U.S., multiplied to get a family of four, then rounded down to $2,500 to get a round number, the article says.

[tobyhill]

Judge Obama not just on his words for tomorrow but for his promises yesterday.

[Carriage Hill]

Notice how “could cut” and “could save” are so frequently used? Nowhere do they say “will save”. Very telling BS article, isn’t it?