CNN, which was hotly denying the rumors of Clinton’s concession until as late as last night, has an article up about the policy differences between the Obama and McCain. The article they link to for a critical analysis of the candidates plans is entitled, “Why McCain has the best health-care plan”. Way to be impartial, CNN. Nonetheless, it’s a good article with lots of great detailed information on exactly how the two proposed policies would work, even if the conclusion presented in the title seems a little forced.
I’ll summarize the information from the article, and you can see if you come up with my conclusions, or the conclusions of the author.
McCain
McCain’s plan would eliminate the employer-paid healthcare plans in favor of a tax credit for buying insurance. He’s not abolishing the employer-paid plans, just making the cost of the plan be considered as taxable income, and offering a credit to offset the extra taxes you’d end up paying. This is thought to lead to via the free market to employers dropping the plans entirely in favor of simply paying employees more, which they can then spend on individual or family plans. It’s also assumed that people would contribute income to an HSA, so combining the increase in income + plus the tax credit would allow people to afford high-deductible, low-premium plans and pay out of pocket for anything else. To apply a little more free-market action to the health insurance industry, he’s going to allow health insurance to be sold across state lines, so a person in Mississippi could buy insurance from a Pennsylvania insurer, subject to Pennsylvania laws. This allows healthy, young people to find cheaper plans which cover less, but would result in increases in the cost of the more comprehensive plans, as they become increasingly composed of the expensive to care for old folks. The overall idea is that insurers will have to compete to get business, and this will make insurers pressure hospitals to reduce costs.
Obama
Obama’s plan has two components: a private and a public part. The public part is essentially Medicare as we have it today, and the private part is an employer-provided healthcare plan similiar to the federal employee healthcare plan. Employers can choose whether to offer the private plan or pay a tax to fund the public plan. The plans have a wide range of benefits, more than young people need, so the deductible isn’t as low as it could be under a free market system, but it will keep the comprehensive coverage plans from spiking in cost. Supposedly employers will all drop their plans and pay the tax to fund the public program. Under this system, the individual isn’t making much choice about which plan to get, rather it’s the insurance companies that have to figure out a way to lower costs if they want to increase profits.
Fortune’s conclusions
McCain’s plan is good for the country because the extra choice provided the consumer will result in lower prices for insurance in the long run, except maybe for old people.
Obama’s plan is bad for the country because health care spending will go up as more people take advantage of their access to health care.
Obama’s plan is bad because it offers benefits like chiropractic and wart removal and other non-acute illness treatments
My conclusions
McCain’s plan is good for me because us healthy youngsters don’t have to subsidize the old fogeys anymore.
McCain’s plan is bad for me because you know we’d just end up subsidizing them anyways.
McCain’s plan is bad for the nation because old people and people who can’t afford the assumed HSA contributions will just have to stay sick until they’re eligible for disability.
McCain’s plan is bad for me because it assumes that my employer would increase my pay by the cost of the healthcare plan they’re no longer paying. Realistically, it’ll be some fraction, and the fraction will be even smaller for those employees paid the least.
McCain’s plan is bad for the nation, because it assumes that everyone has the same economic incentive to contribute to an HSA. Low income people have less need for that tax break.
McCain’s plan is bad because more people will end up sicker, with their only hope being that costs eventually decrease to the point that someone will be able to afford to cover them.
Obama’s plan is good for the nation because giving people access to preventative care will reduce health care costs.
Obama’s plan is good for the nation because the administrative structure is already in place. There’s no need for an additional bureaucracy to determine how to subsidize the insurers.
Obama’s plan isn’t bad for the nation because people don’t generally seek out medical treatment when they can otherwise avoid it. If costs increase, it’s probably because people who needed treatment are now getting it, as opposed to getting treatment they don’t need.
Obama’s plan isn’t bad for the nation because it covers things Fortune magazine deems unnecessary. In fact, that whole argument smells like a strawman.
Obama’s plan isn’t bad for the nation, because there will still be pressure on the hospitals to reduce costs; It’ll be the only way the insurers can make a profit if they can’t cherry-pick healthy people like McCain’s plan allows.
Obama’s plan is good for the nation, because if he’s elected, we’ll have billions of dollars formerly spent in Iraq to throw at the problem!
Would it be too cute to say McCain’s plan would make health insurance like the airline industry, whereas Obama’s plan would make it like the public school system?
