“I was diagnosed with lupus when I was 27. Lupus is an autoimmune disorder. It’s dramatically affected my life. I voted for Barack Obama for president. I thought that Obamacare was going to be a good thing. Instead of helping me, Obamacare has made my life almost impossible. Barack Obama told us we could keep our health insurance if we liked it. And we can’t. I got a letter in the mail saying that my health insurance was over, that it was gone.  It was canceled because of Obamacare. My premiums went from $52 a month to $373 a month. I’m having to work a second job to pay for Obamacare. For somebody with lupus, that’s not an easy thing. If I can’t afford to continue to pay for Obamacare, I don’t get my medicine; I don’t get to see my doctors. I am very disappointed in Barack Obama as a president. He made promises he didn’t keep. And that’s disheartening.”

–Tennessee resident Emilie Lamb, 40, in an ad sponsored by Americans for Prosperity

The Fact Checker is a little late in fact checking this ad—our colleagues at PolitiFact looked closely at it earlier in February—but given the controversy over Senate Majority Leader Harry Reid’s claim that the “vast majority” of the AFP ads are “lies,” we decided it was necessary to delve into the facts behind it.

It certainly packs a punch, with Lamb’s personal anger at the president apparent, hinging on the president’s Four-Pinocchio claim that people who liked their plan could keep it. That’s turned out to be false, and the president’s ill-fated pledge is featured prominently in many of the AFP advertisements.

There are two key assertions made in the ad:

  1. Lamb’s insurance was canceled because it did not meet the requirements of the Affordable Care Act
  2. Her premiums increased from $52 a month to $373 a month.

But as always context is important. Why did those two things happen?

The Facts

Lamb’s old plan was provided through a public-private program aimed at lower-income workers called CoverTN, which split the premium costs between an employee, the employer and the state. That’s a big reason why Lamb’s premium was only $52 a month, but in an interview she said she would have gladly paid and could have afforded the full $156 a month.

Why was the plan so inexpensive? For one thing, it had a $25,000 cap on annual benefits. It also had no limit on out-of-pocket costs, and it would only cover generic medications.

CoverTN was terminated at the end of the 2013 because it did not meet key requirements of the ACA, in particular a ban on such caps on benefits. The Obama administration denied the state’s request for a waiver, and so the plan was shut down.

For health-care reformers, such annual caps on benefits were a sign of a substandard plan that could put someone in bankruptcy if they had an accident that resulted in unexpected medical costs. But Lamb doesn’t look at it that way because she already had suffered a major and costly accident that was unrelated to her chronic condition.

In 2007, Lamb fell off a horse, requiring seven surgeries at Vanderbilt Medical Center. She was told the surgical bill for $125,000, but after negotiations with CoverTN, the hospital agreed to reduce the charges to below $25,000. In the end she barely paid anything in hospital costs after her accident.

“Really after that, I was not worried about something catastrophic” that would exceed the $25,000 cap, she said.

(Others might look at this story and decide she was unusually fortunate that the hospital, confronted with a patient who had inadequate coverage for the surgery, decided to eat the difference.)

[Update, March 19: Lamb, in an email, clarified that she never asked the hospital to reduce the bill. She said she had been told the cost of the surgery, before insurance, would have been $125,000 but it was reduced to below $25,000 because of “network savings."]

Meanwhile, lupus can result in very high medical expenses, but that is not the case with Lamb. She said her out-of-pocket costs, for doctor visits and drug costs, amounted to just $1,000 a year.

“I have very good doctors who have helped me manage my condition,” she said. “I was comfortable with the risk of having this limit.”

To put her expenses in context, the American College of Rheumatology says that average cost per patient with lupus is between $14,000 and $28,000, though patients with one form of lupus have significantly higher costs – ranging from $29,000 to $63,000.

Once Lamb was required to go on Obamacare, she discovered she qualified for a $15-a-month subsidy, which could be applied to nearly 40 different options. She chose one of the more expensive options—a Platinum plan – because it limited out of pocket expenses to $1,500, as her doctor fees and blood tests would be higher under the Obamacare plans. She also considered a plan with a lower premium, but it would have meant higher out of pocket expenses. “Instead of paying $6,000 a year, I would have been paying $10,000 a year” with the plan with a lower premium, she said.

Anyone with a chronic condition would have opted for the plan with the lowest out of pocket maximum, even with a higher premium, so Lamb’s choice makes sense. But it did mean she faced sticker shock, going from $52 a month to $373 a month, even after her subsidy.

In other words, AFP has managed to highlight a very unique case—someone with a chronic condition who did not face high annual costs.

One Lupus sufferer, Erin Kotecki Vest, blogged that she was amazed at Lamb’s tale of woe after she researched the coverage provided by CoverTN. Just ONE of my treatments ALONE wipes out everything CoverTN had to offer me,” she wrote.I would hit CoverTN’s $25,000 annual limit the first week of January.”

In contrast to Lamb, this Lupus sufferer is thrilled to be on Obamacare. Kotecki Vest gleefully wrote in November that her family ditched her husband’s employer-provided plan after they discovered they would save nearly $19,000 a year by switching to a plan offered on healthcare.gov.

For some reason, Kotecki Vest was not asked to appear in an AFP ad. AFP did not respond to a request for comment.

The Pinocchio Test

As we have often noted, there are winners and losers under the Affordable Care Act. The Obama administration erred in suggesting that everyone will be a winner and that nobody would be forced to give up a plan that they liked.

But AFP takes it to the other extreme, highlighting a unique case to condemn the entire law. Lamb certainly faces higher costs now, and she apparently was happy with her previous state-subsidized plan. So she turns out to be one of the losers under the law, and as a one-time Obama supporter she has every right to be upset.

After she had her horse-riding accident, the hospital even decided to foot much of the bill, which is a scenario that the Affordable Care Act is supposed to prevent. (That hospital didn’t just eat Lamb’s expenses; it passed them on to everyone else through higher bills.) In theory, people with insurance will no longer be charged extra to pay for the medical expenses of people with no or limited insurance.

The trade-off, of course, for getting better coverage is that it is going to be more expensive. After all, you don’t get something for nothing.

We can’t quibble with the ad’s words–we certainly would not call it a “lie”–but the lack of context is going to earn it Pinocchios. We wavered between One and Two, but ultimately settled on Two because this is really an exception that proves the rule.

Two Pinocchios

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