It is revealed that Mr. Nugent is now paying almost $1,300 per month for insurance. The story is framed as if he is going out to buy his own insurance in the private market, but it's clear that this is not exactly what is going on here:
SIEGEL: But isn't the essence of your problem right now that you're in the individual insurance market and that if we could find some way for you and the other people who have retired from the sheriff's office to be part of a group buy, a massive group buy, you could do a lot better than $1,200 to $1,300 a month?
Rep. NUGENT: Well, actually, that is part of the group buy. But we pay 100 percent of it. The government doesn't subsidize any portion of it. So that's why it's so expensive.
So when Nugent is talking about the $1,300 per month, he is talking about the full cost of the insurance that someone in the federal employee group pays. He is NOT talking about an individual policy. And the subsidy he mentions:
Rep. NUGENT: ...when you look at what they were going to charge me for family coverage, it was subsidized to the tune of almost 75 percent. And that's the actual cost that the federal government is paying for an elected official's health care.
What the Representative is describing here, is the fact that the federal government typically pays about 75% of the annual premium to cover a member of Congress. Where I come from that is not a subsidy, that is called compensation. Perhaps Mr. Nugent also thinks his congressional paycheck is a subsidy for his lawmaking activity, but to me that sounds like a salary.
Given this, the entire thrust of the story simply falls apart. That thrust being most folks can't afford $1,300 per month premiums on their current salary. What this leaves out is that the portion of a premium paid by an employer is also part of total compensation.
It's true most people can't afford to go from paying $1,000 a year to $15,000 a year for health insurance on their current salary. But if their salary increases by $14,000 a year, just like their insurance premiums, they are in exactly the same position!
It's a basic rule of economics, focus on the unseen as well as the seen. In this case no one seems to notice the part of Nugent's compensation that goes toward health insurance. They only account for his current cash salary and the fact that he has chosen to pay the full amount of his insurance premiums himself. This guy hasn't opted out of federal health care so much as he has engineered a pay cut for himself.
The fact that a member of Congress and an elite media institution can't appreciate these simple facts does not bode well for a successful transformation of the health insurance industry in this country any time in the near future.