Ronald Regan (a Republican) once railed against legislation that would ultimately guarantee health care for older Americans; the program now known as Medicare. Since then, conservative Republicans still hate Medicare and would kill it if they could. They tried to do that during the Clinton years, but so far, have been unable to pull it off.
Now, John McCain wants to destroy the health insurance of non-elderly Americans instead. I repeat, John McCain wants to destroy the health insurance of non elderly Americans instead. That’s you and me, America.
Most Americans under 65 currently get health insurance through their employers, if it’s available. It’s available because the tax code favors such insurance. Your employer’s portion of the insurance is tax deductible as long as the plan follows certain rules. Here’s the catch: the plan has to be available to all employees regardless of the state of their health or the size of their paycheck. Everyone in the plan is equal. Get it?
This system works pretty well when it’s available. However, not all employers offer health benefits so it leaves many Americans out in the cold. They’re forced to search for private insurance, often without any luck in finding it. Here’s the catch: insurance companies offering private coverage refuse to enroll anyone with a pre-existing medical condition and when they do, the costs are prohibitive because insurance companies pend great sums weeding out high risk applicants - the ones who actually might need this insurance.
So what do the candidates want to do? Barack Obama offers us incremental reform. He wants to regulate insurers to prevent discrimination against the less-healthy, subsidies to help low-income families buy insurance, and public insurance plans to compete with the private sector. This is not universal coverage, like the Republicans claim - it falls way short, but it would sharply reduce the number of uninsured Americans in this, our country.
McCain, on the other hand, wants to destroy the current system by eliminating the tax break for employer-sponsored health plans, and he doesn’t, I repeat, does not, offer any alternative. Without that tax break, many US employers will drop their current health insurance plans and up to 20 million workers currently covered will lose their employer-sponsored health plans.
Oh, wait, McCain does have a plan - sort of. He’ll give everyone a tax credit of $2500 for individuals and $5000 for families that can be used to purchase private health coverage. At the same time, McCain will deregulate insurance - leaving companies fee to deny coverage to those with health problems. His proposal for a “high-risk pool” for hard cases would provide little help.
In the end, more people would buy individual insurance - because they had to - no more employer-sponsored coverage. The total number of uninsured Americans might decline slightly under McCain, but many more Americans would be without insurance than under Obama. Got that? More Americans would be uninsured under McCain.
However, under McCain, the people gaining insurance would be those who need it the least: relatively healthy Americans with high incomes. This is because insurance companies want to cover
only healthy people, and even among the healthy only those able to pay a lot more than their $5000 credit will be able to afford coverage after deregulation drive the insurance rates sky-high and only the wealthy will be able to afford coverage (remember, the $5000 credit will only cover a portion of the more than $12,000 the average family will be paying.
And in the process on cushioning the wealthy and banging on the middleclass, the McCain plan will add another layer of expensive bureaucracy to an already over-burdened government. Purveyors of private coverage already spend 29% of the premiums they receive on administration, only because they employ so many people to screen the applicants. This compares to 12% for group plans and 3% for Medicare.
The bottom line is: the McCain plan makes no sense at all, unless you believe in the miracle of the philosopher’s stone: changing lead into gold. Apparently McCain does: he published an article under his name stating thet “Opening up the health insurance market to more vigorous nationwide competition, as we have done over the last decade in banking, would provide more choices of innovative products less burdened by the worst excesses of state-based regulation”. Mr. McCain, just what have you been smoking? The McCain plan will do for health care what deregulation has done for banking.
Filed under: economics, politics | Tagged: banking, deregulation, health care, insurance, John McCain | No Comments »