Wednesday, October 22, 2008
Obama's health plan is the better choice
From the RoundTable blog
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Timothy Stoltzfus Jost
Jost, of Harrisonburg, is the Robert L. Willett Family Professor at Washington and Lee. He is engaged in research and writing in health policy and comparative health policy as well as in health law and regulation.
The American health care system is in terrible shape. Census data released last month show that almost 46 million Americans, 15.3 percent of our population, are uninsured. A study published earlier this year revealed that 22,000 Americans die every year from lack of health insurance, more than seven times the number who died in the 9/11 attacks. The annual Employer Health Benefits survey released recently found that employment-related health insurance premiums reached $12,680 this year, up 119 percent during the eight years Republicans have run the country. The high cost of health care is also increasingly passed on to workers. Health insurance deductibles went up by a third this year.
The quality of health care in the United States is also unexceptional. A recent study found that the United States ranks last among 19 industrialized nations on deaths that might have been prevented with timely and effective care. We can and must do better.
Both presidential candidates offer a program for fixing our health care system. Both offer similar proposals for improving the quality of health care -- encouraging prevention and coordination of care, improving health care information technology and implementing payment based on quality. Both also would attempt to harness the forces of competition to bring down costs, though they would do so in very different ways.
When it comes to the fundamental problem of providing access to health insurance, however, the candidates take radically different approaches.
Sen. John McCain would abolish the current federal tax exemption for employer-sponsored insurance, immediately raising taxes on the 177 million Americans covered by job-related health insurance, often by thousands of dollars a year. It is estimated that this change would cause many employers to drop health insurance, leaving from 10 million to 28 million more Americans uninsured.
In exchange, McCain would offer Americans tax credits to pay for health insurance: $2,500 for individuals, $5,000 for families. This money would be spent, however, to purchase insurance in the individual market, where administrative costs are three times those of employer-provided insurance, and where deductibles, co-insurance and co-payments are all much higher. These credits would also fall far short of the actual cost of insurance.
Moreover, McCain proposes to essentially deregulate insurance by allowing interstate insurance sales, thus removing the protections that Americans now receive from state insurance regulation. (Remember how well deregulation has worked for financial markets.) People with chronic health problems would find individual insurance unavailable, but McCain offers them only state high-risk pools, an approach that has been tried with little success.
Sen. Barack Obama, in turn, offers real hope for uninsured Americans. During one of the debates, McCain said, "I want to make sure that we're not handing the health care system over to the federal government, which is basically what would ultimately happen with Senator Obama's health care plan. I want the families to make decisions between themselves and their doctors, not the federal government."
McCain obviously has not read Obama's plan, or chose not to describe it truthfully.
Obama's plan does not put the federal government in charge of health care. It builds on our current employment-based system rather than undermining it. It requires large employers to provide health insurance for their employees or to contribute to the cost of health care, while it provides subsidies to small businesses for health insurance and to all employers to cover catastrophic costs. It would establish "insurance exchanges," organized markets through which small businesses and individuals could purchase insurance. Organized competition among insurers would bring down costs. Obama would offer income-related subsidies to help lower-income families afford health insurance. His plan would expand Medicaid and SCHIP to make sure all children are covered.
Finally, it would provide a new public insurance program offering coverage like that which McCain and Obama currently enjoy to individuals and small businesses who preferred it to private insurance. But no one would have to leave the private insurer they now have if they are satisfied with it.
A final, vitally important question is which candidate can really bring change. All signs now point toward the Democrats controlling the next Congress. McCain's health care plan is virtually identical to that proposed last year by President Bush, which Congress completely ignored. Obama can work with Democrats and moderate Republicans in Congress to craft a plan that can actually become law. If you are one of the millions of Americans shut out of our health care system, vote for real change. Vote for Obama.
