Candidates on Health-Care

By Cole Bielfeldt


According to various sources, around 47 million Americans do not have health insurance. What’s more is that those who have insurance aren’t necessarily covered to their needs, and some are gouged for pre-existing conditions or simply denied coverage. In a nation full of exploding medical costs and high numbers of uninsured or underinsured citizens, it’s no wonder healthcare plans are such a hot-button issue for the 2008 presidential election.

Among the three main candidates, Republican John McCain and the two contending Democratic candidate Barack Obama and Hillary Clinton, there are three main similarities. First, all support prescription drug imports from countries with similar drug safety requirements to the USA, meaning more competitive prices for the prescription medicines Americans pay so much for. The candidates also agree on removing the bans on direct negotiation between Medicare, the government, and pharmaceutical companies to lower the cost of drugs.

Finally, the most significant similarity is the promise of portable insurance, meaning the individual may keep their insurance despite job status changes or moving across state lines. Currently, most health providers are not valid in other states, or the individual is only able to purchase insurance through a group plan through their jobs. All three candidates hold in their platforms the promise that Americans can keep their insurance even if they change jobs or move locations (NY Times, comparison). The promise of portable insurance may relieve the stress on those who rely on their employers to provide insurance.

While Obama and Clinton continue in similar routes for their healthcare platforms, the similarities among the Democratic candidates and McCain end here.

McCain claims that increased competition among insurance providers will significantly decrease the premiums in the nation. Fortune Magazine’s writer Shawn Tully declares that McCain has the best healthcare plan because his is the most economically plausible. Currently, employees receive a tax break if their employers provide their insurance, a program implemented after World War II which has severely damaged the healthcare system. In McCain’s plan, employers would add the money they saved from providing insurance onto the salary of its employees, who would then buy insurance plans that fit their specific needs. For example, families could buy more comprehensive plans while young, single individuals could buy cheaper plans. Individuals would also have the option of buying interstate plans instead of being locked into choices based on their location.

The biggest criticism of McCain comes from this same article: McCain’s plan runs the risk of leaving out the poor and sick. Insurance companies love to insure young, healthy people because these types of customers create the least amount of “medical losses,” a term used for the payments insurance companies make for the medical treatment of their customers (NY times “voodoo”). The payments made from the healthy individuals help to cover the costs of those who are in need like those with chronic illnesses or are elderly. In this area, McCain lacks a plan to cover the huge subsidies needed to fill the gaps made by his laissez-faire approach and “even some pro-business voices have said McCain’s plan falls short of helping enough people in need” (Boston Globe).

New York Times’ writer Paul Krugman declares McCain’s plan to be based on “voodoo health economics”, meaning that competition will not necessarily help the healthcare crisis. Krugman points out how insurance providers keep their “medical losses” down through two methods: insuring healthy people and denying as many claims as possible. He also argues that comparing international statistics proves how competition doesn’t work. The US has the most market competition, yet also pays the most in healthcare costs.

In almost complete opposition to McCain’s approach, Democratic Hillary Clinton proposes her American Health Choices Plan (AHC) which mandates that every American has health insurance. According to the official Clinton campaign website, her plan offers three options for insurance. One, if the individual is content with his/her insurance, they may keep their same plan. Two, if the individual is uninsured or discontented with his/her insurance plan, he/she may choose from a new Health Choices Menu which offers plans comparable to the health insurance offered to members of Congress. Three, through tax credits and government help, individuals can be covered by a more powerful Medicaid program that will cover those who cannot afford to buy an insurance plan.

Clinton also wants to create reforms to help reduce wasted expenditures. Some of her reforms include phasing out Medicare overpayments to HMOs. The plan reduces unnecessary Medicare and Medicaid spending such as the disproportionate share hospital (DSH) which forces paying patients to cover the costs of unpaid care. AHC also mandates that hospitals use information technology which reduces costs and increases communication among care givers. These reforms, and several others, are projected by the AHC to save $120 billion per year.

Additionally, the AHC requires that all employers provide health insurance for their employees or contribute to the cost of insurance. Clinton exempts small businesses from this requirement, but says the tax credits will ensure that no American goes uninsured. The AHC also strives to eliminate healthcare discrimination, not providing coverage for those with pre-existing conditions or who are high risk, and requires an automatic renewal of insurance if the individual wants to continue the coverage. Clinton plans to implement a Best Practices Institute to find the best treatments and compare the effectiveness of those treatments, ensuring better quality care.

However, some critics say that Clinton underestimates the costs of these health-care reforms. In the Washington Times, Michael Tanner, the Cato institute’s chief domestic policy analyst, says that Clinton has no proof her reforms will actually save money and past experience shows that government initial cost estimates are hardly, if ever, accurate. Experts say Clinton’s plan is similar to Senator John Kerry’s plan in the 2004 elections, and his plan cost $1.4 trillion to put into effect, compared to Clinton’s estimate of $110 billion per year (Washington Times).

Illinois’ freshman Senator, Barack Obama, offers a plan that is close to Clinton’s ACH, but offers a more conservative view on the pathway to universal health-care. Even Obama admits, “Ninety-five percent of our plans are similar…” (NY times, comparison). However, Obama holds to the philosophical differences in their campaigns. The senator does not mandate that all Americans purchase insurance (Obama website). Instead, he requires that all children are covered by insurance, and he provides the tax credits and programs to accomplish that goal.

Supporters of Obama declare that his plan “offers full coverage without emptying the treasury” (News & Observer). His care plan consists of portable coverage through public and private financing means, according to his official platform. Obama’s plan attempts to model the Medicaid program after the Veteran’s Association (VA) program, which is an integrated system exemplifying the Democratic health-care plans by reducing medical errors and saving money through the use of information technology (NY times, voodoo). By allowing direct negotiation with pharmaceutical companies, Obama hopes to increase competition among companies and strengthen the Medicare program (Obama website).

Wayne Madsen, a writer from News & Observer, says the affordable premiums, co-pays, and deductibles will make such a drastic difference in the market that, “The mere federal impetus for its own national health plan will force private providers to become more affordable and competitive or simply go out of business.”

Obama’s plan also requires employers, exempting small businesses, to provide adequate coverage for their employees. This health-care plan also covers for mental illness, an issue often not talked about on the political level.

Other experts are not so confident in Obama’s plan. Gregory D’Angelo of the Salt Lake Tribune believes that Obama’s platform will cause an increase as opposed to a decrease of health-care costs. D’Angelo says, “…experience shows that replacing competition with federal regulation and restricting consumers’ choices is a prescription for higher—not lower—costs.”

The article quotes John Sheils, a health economist from Lewin Group, who believes the savings Obama declares will occur are “dramatically overstated.”  Another health economist, Jonathan Gruber from MIT, says that Obama doesn’t have any credible evidence to support his claims of saving up to $2,500 per family per year, and analysts estimate the cost of his program to be twice what his platform declares.

No matter from what angle you look at the issue, health care is an extremely important issue and the views of the candidates are very important to the future of our country. However, the promises made by the presidential candidate must be taken with a bit of skepticism. Price estimations are most likely low and savings estimations are most likely high simply to win over the votes.

Most importantly, the president does not make law; Congress does. The plans of the three presidential candidates do have significant flaws and benefits, the plans mean nothing if Congress does not support these ideas and pass them into law. If choosing the president is important, choosing Congress members is even more so.