Tuesday, September 30, 2008

The Problem With Tax-Breaks for Healthcare - or - McCain's Healthcare Plan: Don't Get Sick

I think as a nation that we've largely overcome the hump of getting everyone on board with the notion that we need some sort of nationalized health care. Even the most conservative people I know believe health care should be a right, not a privilege. I may be wrong on this general consensus, but I'm going to believe in it because I want to believe that there's a general will to do the right thing out there.

That being said, I'd be remiss if I let this week go by without laying out exactly where a national health care plan should go and what it should do. Though I have my disagreements with Obama's plan (e.g., not a mandate or universal coverage, but rather coverage for those whose employer does not provide it and incentives for employers to provide it or enroll in the national plan) and I believe that whatever national health care plan does eventually make its way to the people will look different from what is proposed, I cannot stand idly and not comment on McCain's complete failure to address the problem.

So to break it down, here's why McCain's Health Care Plan is a massive failure:

  • It does not mandate coverage. Under Obama's plan, flaws and all, every American will be covered by a plan, one way or another. That's not true under McCain's plan. McCain's plan offers tax incentives to getting coverage, but does not make it even more available than it is now and doesn't require every person to be covered and every insurer to accept you regardless of medical history. In other words, you're on your own. And as anyone who has shopped for alternative coverage can tell you, you are screwed.
  • It encourages "free market" policies to take advantage of Americans. Instead of being insured under group policies, every person would be insured by an individual policy. McCain calls this being responsible for your own health care. McCain's solution to the insurance issue: "An important part of his plan is to use competition to improve the quality of health insurance with greater variety to match people's needs, lower prices, and portability. Families should be able to purchase health insurance nationwide, across state lines." That's a direct quote. Here's a translation: big companies are still going to make money off of a basic service, something we know doesn't work. Furthermore everyday Americans will be lucky if they can even find coverage because competition does not provide basic safeguards. If anyone needs a lesson about that, they need look no further than the current financial meltdown.
  • It taxes those whose employer does provide benefits. That's right Joe Blow--now your company-provided health care will now count towards your income and be taxable. So much for cutting taxes to help the economy. In other words, since health care benefits for a family equal about the equivalent of $12,000, those who need the break the most--working families--will instead be taxed at a higher level for benefits they receive. Of course, they'll get a tax break...in amount much less than the increased taxed income they'll be charged for. In other words, the plan isn't so much of a plan to encourage coverage, it's a plan to encourage people to go out into the "free market" to get insurance--even if that insurance is not as good--because there are greater tax benefits to do so. Surely, such a policy is absurd to anyone. At least, I thought that. Meanwhile companies will be greater encouraged (as if they needed more encouragement) to lower benefits to their employees and basically strip the American Worker (the 'fundamentals of the economy') of any chance of breaking even.
The end result of McCain's plan is this: not only is the American Worker screwed, he's screwed without a kiss. A good resource to review these policies substantively is the Economists for Obama site. There is also a narrative comparison of the effect either plan would have on ordinary Americans. Another good source is a straight-talkin' break down of what McCain's plan truly brings to the table.

The choice is pretty clear--there is a choice between coverage for all and coverage for the elite few who probably don't need it anyhow. I'll take the former any day of the week.


God's Rock Angel said...

Would something like the NHS not work in the states then?

You can go to the Doctors for free because its under the NHS but you have to pay for your prescription (at present its about £6/7 - i dont get sick often!)

If you go to the dentist under nhs it's subsidised rather than free for a check up. (about £15)

Opticians again subsised rather than free (about £20 for an eye test)

The Road Less Traveled said...

NHS will have to be introduced slowly into the US because, although most people are unhappy with the current system, they are afraid of having a "socialist" system. A good example of this is what the current administration is doing with Medicare. I have very conservative family who will absolutely not support NHS in the US.

Second, a mandatory plan would not work unless having the coverage itself is free. People will just not be able to afford it otherwise. You could give subsidies to people with lower incomes, but there's always the people just above that cutoff who get screwed. I do think it's great that Obama's trying to cover individuals with pre-existing conditions though. Woo is he going to get some opposition from the insurance industry!

Lastly, tax breaks for healthcare is the most useless health reform ever!

Barbara Weibel said...

Amen! So WHY would anyone vote for McCain - unless of course they're rich, which according to McCain means earning upward of $4 million per year.


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