Comparing the candidates' health care plans
October 23, 2008| By David Talbot
Senator Barack Obama's health care plan would concentrate health care decision-making in Washington, while Senator John McCain's would return many health care decisions to families, according to two in-depth analyses by Heritage Foundation health care experts Robert Moffit and Nina Owcharenko.
Senator Obama's plan "would likely precipitate a rapid evolution toward a federal monopoly over the health care sector," they explain.
In his top-down plan, there would be "standardized federal health benefits structure, a massive expansion of federal regulatory authority over health insurance, and an enlargement of federal regulatory power over health care delivery."
Four initiatives stand out in Obama's plan:
- New federal provision and control. Obama's new government-run national health plan would compete directly with private health plans in a National Health Insurance Exchange.
- More federal involvement in employer-based coverage. The Obama plan would mandate that employers either provide a federally approved level of health benefits to their workers or pay a new tax to help finance the government's new national health plan.
- Expansion of government health programs, restrictions on state innovation, and mandated coverage for children. The plan calls for unspecified expansions of Medicaid and SCHIP, the plan targeted at children in low-income families.
- Federal regulation of health care delivery. The federal government would regulate the delivery of medical care through specific channels.
Not all details of his plan are available, so it's hard to be certain of the plan's true costs, Moffit and Owcharenko warn.
The McCain plan is likewise ambitious, they argue in their second analysis, but his measures "would advance greater personal choice and control in the health care system."
Notably, his plan alters the way health insurance is taxed so that individuals aren't penalized if they do not buy coverage through their employer. This plan takes "the first steps to realigning the incentives in the system to provide consumers with better quality care at lower cost."
The key reforms in McCain's plan are:
- Equal tax treatment for health coverage. The Senator would replace the special tax breaks for employer-based health insurance with a universal system of health care tax credits for the purchase of health insurance.
- Health insurance competition on a national scale. Currently, only federal workers and retirees in the Federal Employees Health Benefits Program benefit from competition among private health insurance companies on a national scale. The McCain health plan would change this by allowing individuals and families to buy health plans based in other states.
- Federal assistance to the states to cover vulnerable populations. The Senator envisions a large role for state innovation and experimentation in health care financing and delivery, but he would provide safety-net funding to ensure coverage of the most vulnerable populations: the hard-to-insure and the uninsurable.
Senator McCain's plan "is underscored by a principled commitment to personal freedom," they conclude. Nevertheless, the lack of available details raises questions about whether these reforms will be undermined by increasing government interference.
