McCain Health Care Plan is Easy to Criticize; Obama’s is Hardly a Substantial “Change”

McCain’s health care plan would end employer-based insurance programs for many in Michigan according to a new study. However, Obama’s plan–while better–would hardly deliver a major change in the health care system. Both candidates would keep a system of private insurers.

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In a news release sent yesterday, Progress Michigan announced the release of a new study by the Center for American Progress Action Fund and Health Care for America Now that criticizes Republican presidential candidate John McCain’s health care plan. The study–which focuses all of its attention on McCain’s plan–argues that McCain’s plan would have dire consequences for the state of Michigan.

The study argues that under McCain’s plan, some 720,000 Michigan residents would likely loose their health care as it shifts from employer-based to individual-based plans. Moreover, it would “threaten” the health care of an additional 5.9 million residents in the state. McCain’s plan would eliminate health care tax benefits to businesses while at the same time it would allow individual-based plans to choose whom they cover based on medical history. The study further estimates that McCain’s plan could result in Michigan families paying almost $1,100 more in taxes if McCain imposes both income and payroll taxes on health coverage.

Of the two major party presidential candidates, John McCain’s health care plan offers more radical changes than that of Democrat Barack Obama. McCain’s plan would effectively dismantle the current employer-based system by eliminating the tax deduction that businesses get when they pay health premiums for employees. To offset this, he would provide tax credits–up to $5,000 for families and $2,500 for individuals–to purchase insurance. McCain’s plan relies on the notion that market forces would help to reduce costs and make insurance more accessible. Additionally, McCain offers some measures aimed at containing health costs, for example reforming malpractice laws, but his primary means of doing this would be through the hope that competition would drive down costs.

However, while McCain’s health care proposals have been criticized in the media and by progressives, it is not safe to assume that Democratic candidate Barack Obama’s health care plan represents a substantial “change” from the status quo. While Obama and his supporters tout his plan as being a form of “national” health care that would greatly improve access, it is far from being a bold plan and is actually rather limited for a “change” candidate. According to a number of different sources, his plan would do relatively little to insure the 47 million people in the United States who are uninsured. Similarly, it would not create a universal health care system, despite the use of “national” and “universal” to describe his plan in the media. Instead, it allows for the continuation of the current system of private health insurance while adopting some tweaks designed to improve the workings of the system. Obama has claimed that his proposal will reduce premiums by $2,500 for the typical family.

Obama’s proposal stops far short of mandating health care for all. The closest he comes is a mandate that all children under 25 be covered. However, that has been criticized as hard to enforce and unlikely that he will enroll more children than federal and state governments already have in the State Children’s Health Insurance Program (SCHIP). Under his plan, adults would have the option of purchasing a new government plan. This plan–which would be funded by a combination of repealing Bush administration tax cuts and contributions from employers who do not offer their own affordable coverage plan–would be available to everyone through a sort of federal “market place” through which citizens could purchase either the public plan or a private plan. A preliminary and tentative analysis by the Tax Policy Center has said that Obama may reduce the number of uninsured by 18 million at the start of his plan and by as much as 34 million at the end.

Obama seeks to pay for his plan by using costs from a repeal of the Bush tax cuts and savings from using electronic records, as well as programs aimed to improve disease prevention and chronic disease management. However, critics with groups like the Physicians for a National Health Program point out that single-payer systems, such as the one in Canada, have the potential to offer substantial cost savings–far more than what can be achieved by relying on the private insurance model. According to the organization, some $300 billion could be saved per year in billing and paperwork costs. In the US, 31% of all health care spending is for administrative costs compared to 17% in Canada. The United States’ single-payer system, Medicare, has administrative costs of about 3% compared to 12% to 15% for private insurers. Obama’s plan misses these potential savings because it sees the solution within the current framework.

Regardless of the limitations of both major party candidates’ plans, one thing is clear–there needs to be a far broader and deeper debate over health care in the United States. While the two major presidential party candidates advocate changing health care, they stay close to the status quo–as shown by their support from the health and insurance industries. Unfortunately, the media has pushed for such a discussion either and has instead tended to ignore the intricacies of the candidates’ health care plans and report their claims verbatim. In the primary debates, only 8% of questions focused on health care–a paltry number for the seriousness of the issue.

Despite all this, it is unlikely that either plan will ever be enacted wholesale–making it essential that people organize to demand more than what is being offered by the two major party candidates.

Author: mediamouse

Grand Rapids independent media // mediamouse.org