Rival Economists Blast Obama, McCain Health Care Plans

Health care reform is a prominent issue in the 2008 presidential election, and the positions of the two major presidential candidates have been placed head-to-head in an adversarial debate published last week in Health Affairs. Opposing economists criticize the Obama health care reform bill on one hand and the McCain health care reform plan on the other.

For instance, after 5 years under the health care plan of John McCain, the number of uninsured people in America would increase by five million, predicted Sherry Glied, PhD, a professor and chair of the Department of Health Policy and Management at the Mailman School of Public Health of New York City’s Columbia University.

However, Barack Obama’s plan ignores economic drivers of the health care market and could cost $1.1 trillion in 10 years, wrote Gail Wilensky, PhD, a senior fellow at Project HOPE in Bethesda, Md.

Glied asserts that the three major features of McCain’s plan would affect actual insurance enrollment rates. Those three features are taxing premiums paid by employers on their employees’ health insurance, introducing a tax credit to be used to purchase health insurance ($2,500 for individuals and $5,000 for families), and allowing people to purchase policies from insurers licensed in other states.

McCain proposes scrapping the current tax exemption employers are granted for buying coverage for their workers. Under the current system, in order to qualify for the tax subsidy, employers must provide similar benefits to high- and low-wage workers under an IRS nondiscrimination rule.

On the other hand, Wilensky claims that the Obama plan "ignores the core economic incentives that drive health care."

She looks at a few key features of the Obama plan—the creation of a National Heath Plan, a Health Insurance Exchange, a reinsurance subsidy, a "pay-or-play" requirement for larger employers, and the mandate that all children be insured.

"Each of these extends the control of government over health insurance, imposing new requirements that will drive up the cost of insurance unless the savings from other policies that have been claimed by the campaign actually materialize," Wilensky says.

More.

[Source: Health Affairs]