Not twelve hours after I blogged about John McCain’s healthcare plan, Bob Herbert wrote in the New York Times about what Palin and McCain would do to American healthcare insurance as we know it. So, I will update my original post with some of Herbert’s excellent commentary. Read on, and please, PASS IT ON.
Let me plainly say, I have learned about John McCain’s healthcare proposal comes from what is clearly a biased source- the Campaign for America’s Future. Nonetheless, I urge you to read their fact sheet; you will learn a lot about what questions you should be asking about each candidate’s healthcare proposals.
First of, McCain-Palin propose to end the practice of exempting the contribution your employer makes to your health insurance from your taxable income. Instead, McCain proposes to give individuals a $2,500 tax credit, and families a $5,000 tax credit. He argues that we can take that money we would have paid in taxes and go out and buy an individual plan that meets our needs better than the one our employers cost-share with so many of us. The main problem is of course that $2,500 (or $5,000) doesn’t begin to cover the cost of an individual plan. Your share of a group plan can already easily cost you this much each year. Individual plans cost much, much more. The McCain-Palin plan would remove the incentive for employers to cost-share insurance as they now do, and make it more expensive insurance when they still do offer it. More Americans would find themselves without insurance. As Bob Herbert put it:
A study coming out Tuesday from scholars at Columbia, Harvard, Purdue and Michigan projects that 20 million Americans who have employment-based health insurance would lose it under the McCain plan…..
When younger, healthier workers start seeing additional taxes taken out of their paychecks, some (perhaps many) will opt out of the employer-based plans — either to buy cheaper insurance on their own or to go without coverage.
That will leave employers with a pool of older, less healthy workers to cover. That coverage will necessarily be more expensive, which will encourage more and more employers to give up on the idea of providing coverage at all.
Secondly, McCain-Palin propose to allow Americans to buy individual plans in any other state in the union, setting up what this white paper calls a race to the bottom among states. Much as corporations flock to Delaware for its low taxes, insurance companies would set up in states with the weakest regulation. Herbert notes that this means any state’s well-intentioned (regulatory) requirement that plans cover vaccinations, breast exams or other critical healthcare needs, would become meaningless.
Thirdly, the McCain-Palin plan does not require individual healthcare plans to cover people with pre-existing medical conditions, the most egregious problem with our current healthcare system. Because McCain would push more of us into individual healthcare plans, more people with pre-existing conditions would lose their coverage. Again, Herbert notes:
In a refrain we’ve heard many times in recent years, Mr. McCain said he is committed to ridding the market of these “needless and costly” insurance regulations. (my emphasis added)
This entire McCain health insurance transformation is right out of the right-wing Republicans’ ideological playbook: fewer regulations; let the market decide; and send unsophisticated consumers into the crucible alone.
You would think that with some of the most venerable houses on Wall Street crumbling like sand castles right before our eyes, we’d be a little wary about spreading this toxic formula even further into the health care system.
So if I understand this correctly, McCain and Palin are gonna ride into Washington, and rip the golden parachutes off of Wall Street CEOs’ backs with tough new Democratic talking points about oversight (i.e., regulatory reform) in delayed response to a massive credit crunch that has been building way longer than the weekend Lehman Bros. collapsed. But, when it comes to the private insurance market, it’s just another page out of the same old playbook that helped pave the way for the credit crunch: just weed out the “needless and costly” oversight (i.e. regulatory reform!) and return “control” to the consumers. Just let folks choose whether they want no insurance or really costly insurance. I feel empowered, don’t you?
Thanks, but no thanks.
UPDATE: Responding to the frequent charge that the McCain plan urges healthy younger workers to leave their employer plans, and use the $2,500 McCain credit for cheaper plans (thereby making the remaining older workers’ group plan more expensive to insure), McCain’s top economic advisor had this to say on October 29 to CNN Money:
“Why would they leave?” Holtz-Eakin asked. “What they are getting from their employer is way better than what they could get with the credit.”
So, if what American workers have with their employers today is way better than what they could get with a $2,500 tax credit, why is John McCain proposing to tax the way better employer provided benefits as income and offer the inferior tax credit instead??
Inform Your Consent 