McCain's Terrible Health Care Plan

(Part three of a two-part series!)

In a weak moment not focused entirely on random black preachers from Chicago, MSNBC's "Race For The White House" took a minute to focus on John McCain's health care policy. Eugene Robinson had to concede, "It's not much of a plan - it does nothing for the 47 million people without health care. Increasing walk-in clinics? People can't walk right now! They'll have to add ramps to them."

Actually, increasing access would be a good thing, but of course McCain's plan is far more hurtful than that. His central tenet on health care is that people have too much insurance.

This is truly amazing: McCain and his handlers knew they had to say something about health care. So they turned to their friends (and financial supporters) in the health care industry and the conservative think tanks. And they have adopted the most extreme right-wing ideological approach, premised on the idea that the big problem in health care is that Americans have too much insurance – in their words, we don’t have enough “skin in the game” – and that only when we have to buy health care with money that comes directly out of our own pockets will consumers force doctors, hospitals and insurance companies to become more efficient [...]

So McCain wants to tax workers’ health care premiums that are paid for by employers. Ask any expert, conservative or liberal, and they will tell you the result will be companies will stop providing health care as an employee benefit. Fortune Magazine quotes one of their experts on the impact of McCain's plan: “I predict that most companies would stop paying for health care in three to four years,” says Robert Laszewski, a consultant who works with corporate benefits managers.

Now keep this in mind: McCain and his corporate advisers don’t dispute this. The massive upheaval that would result – millions of families losing their health coverage on the job and then having to try to find an insurance company that would sell them a new policy that would cover their families—that’s not an unintended consequence of his proposal. That chaotic loss of health security is exactly what McCain intends to happen. He wants us all to buy insurance not as part of a group—like an employee group or a co-op—that can negotiate for better coverage at lower premiums, but as individuals, at the mercy of the private insurance companies.

The only benefit to individuals who will be scrambling for new coverage is a tax credit that is completely insufficient to cover the current cost of healthcare by a factor of about 2:1.

And it's a tax credit, which means the actual benefit is substantially less than the numbers he states (maybe 30%), because it's simply factored into deductions. And if you are so poor that you don't pay anything in taxes, guess what? You don't get the tax credit, because it would be a deduction from zero. And so the people most at risk, the most likely to be uninsured, get nothing from McCain's plan.

I need to tweak this section a bit. The tax credit is effectively a cash payout, but at $2,500 for individuals and $5,000 for families it remains woefully insufficient to cover anything but the most bare-bones care, and in most cases not even that - the average health care bill is twice as much. Also, assuming that this tax credit will come in with your normal refund, families will essentially have to lay out the funds year-round for this and wait until April for reimbursement - which is not only an opportunity cost but actually an impossibility for a lot of folks.

Oh, and don't even get me started on Health Savings Accounts, which is what McCain wants you to do with any excess money if you find a cheap insurance plan. Simply put, they're abominable, and under McCain's plan they're designed to drain your cash out for trips to the doctor since you're stuck with high-deductible, low-coverage insurance.

In the end, the individual who does qualify for the credit will be paying more for health care
than corporations do now, CONTRIBUTING to rising costs, not the opposite.

I don't actually have a huge problem with severing the employer-based relationship to healthcare, but only if individuals could pool their risk to keep costs down and be able to bargain for coverage - you know, like a single-payer system would do. McCain's option simply leaves individuals out on an island with no bargaining power. We'd be in far worse shape than we are now.

But that's not the worst part.

And get this: McCain wants to abolish the regulations that currently exist in most states that require companies to insure people with pre-existing conditions, provide benefits that don’t exclude some medical conditions, and prevent them from charging huge premiums for crumby benefits. How would he do this? By “giving people the freedom” to buy insurance in other states with weaker regulations. You can bet that most of the big insurance companies are now shopping around for the state that wants to become the corporate headquarters state for the new deregulated health insurance industry – if President McCain wins. Delaware? Mississippi? Arizona?

UPDATE: McCain talks vaguely about "working with governors" to create non-profits that would backfill the cost to insurers to cover high-risk patients, creating yet another middleman! There are little if any specifics on this part, and it's highly dubious that it would work.

By eliminating state-created mandates to insure individuals for a variety of maladies, McCain would really end up hurting the sick and chronically ill, leaving them with no insurance. An unregulated market would simply refuse to insure people by the millions in an effort to maximize their costs by insuring only the healthy. You know, the way it is now - only worse, because the states would be unable to look out for their own citizens, and insurance companies would start a race to the bottom, bribing states with their business in exchange for lax regulation. The McCain campaign's response to this? Let the market sort it out!

Steve Bernard was talking about treatments for his 9-year-old son, Jake, who was born with a cleft lip and palate. Jake has already undergone numerous surgeries with more to come. Bernard described his battle to get insurance coverage for speech therapy. “Every time they say, `No, speech therapy isn’t covered,’ and we say, `yes it is covered.’ As a matter of fact in the state of Florida there are specific statutes that were created by other parents of kids with clefts that will protect those kids.”

He ended his comments with a plea to McCain, whose adopted daughter, Bridget, also had a cleft palate: “If there’s ever going to be somebody in leadership position who is going to know it, it’s going to be you, and we’re hoping you understand that,” Bernard said.

Left unsaid was that McCain’s health plan is designed to weaken state regulations like the one in Florida that, like 14 other states, mandates that insurance companies cover treatment for cleft palates. McCain says that mandates like this one drive up the cost of insurance, and he would allow people to buy coverage across state lines. Many experts predict that under this system, insurance companies would simply gravitate to the states with the fewest rules.

Asked about the contradiction between the family on the stage and the McCain policy, McCain senior policy adviser Douglas Holtz-Eakin said that the marketplace will fill the void. If there is a demand for this kind of coverage, he said, some insurance company will offer it. “There are boutique products in every other market,” he said.

McCain's laissez-faire stance makes George Bush look like Michael Moore. He offers nothing but double talk on the subject of health care, and fails on virtually every level - to lower costs, increase coverage, and reduce the power of the insurance industry. He's had government-run health care for his entire life, and his meager gruel offered to those who do not suggests that Elizabeth Edwards is right - on health care he's completely out of touch with reality.