How Children Fare in the Health Care Debate

A report has detailed how children are treated in the health care plans of Senators John McCain and Barack Obama. The report identifies both opportunities and concerns with the policy changes outlined by both candidates, with an eye toward whether the plans would ensure access to comprehensive and affordable health care insurance for every American child.

The report takes into consideration the unique health care needs of children when analyzing the impacts of tax credits, purchasing private insurance across state lines, covering children through a mandate, and how public programs interact with private sector coverage.

The report concludes the following regarding Senator McCain's plan:

-- The McCain tax credit will weaken families' ability to afford coverage for children, as it is insufficient to make coverage affordable and does not keep pace with growth in the cost of health care premiums. Specifically, the tax credit fails to adjust for family size and the added cost when children are born or adopted. Therefore, the credit provides assistance for a significantly smaller share of health care costs for families with children than for childless households.
-- The 19 million children with special health care needs currently insured though employer coverage may be barred from insurance due to pre-existing conditions. Children who need insurance most, those who are sick today, could be charged much more for insurance, if they are
offered insurance coverage at all.
-- By allowing insurance to be sold across state lines, millions of children will lose the protection of having guaranteed benefits. In fact, it is estimated that up to 55 million children could lose the
protection for mandated coverage for well care visits, 18 million could lose autism care, and 16 million children could lose lead poisoning treatment.
-- Funding for public insurance programs for low-income children could be reduced, through McCain's proposed reductions in Medicaid spending.


The report also concludes the following with regard to Senator Obama's plan:
-- The plan seeks to ensure that all of the more than 8 million children currently without health insurance will become insured throughcombination of public and private coverage options and by requiring parents to enroll their children in coverage.
-- Successful public programs will be expanded and strengthened to provide coverage to more children. The Obama plan would continue and expand Medicaid and State Children's Health Insurance Program (SCHIP), critical programs that act as safety-net coverage for children.
-- Tens of millions of children will benefit from improved consumer protections in the private health insurance market.

The report can be viewed at http://www.firstfocus.net/pages/3519/.

McCain Health Plan And Tax Credit

John McCain's fix for health-care reform is based the logical Republican remedy: competition in the marketplace.

"John McCain is putting the American family in charge," said Douglas Holtz-Eakin, McCain's chief policy adviser, a former director of the Congressional Budget Office and a member of President Bush's Council of Economic Advisers.

"The basic template is to control the cost and growth of health care and to control the outcomes," he said. "It's about competition in the marketplace Let's have them compete on the right grounds -- quality of care."

The foundation of McCain's health-care strategy is his proposal to provide a tax credit of $2,500 for individuals ($5,000 for families) to buy health insurance. His campaign estimates the plan could remove 25 million to 30 million people from the rolls of the uninsured; critics contend the number would be far fewer.

At the same time, McCain proposes removing the favorable tax treatment of employer-sponsored insurance, a move that some people think will cause employers to drop health-care coverage for employees, pushing them into the private market.

"The goal of the McCain plan is to transform health care to center on Americans' choices, while providing access to quality and affordable health care for all Americans," the campaign says. "Families -- not government bureaucrats or insurance companies -- will make the decisions that best reflect their family needs."

Other provisions of the McCain plan would make coverage portable, allow insurance to be purchased across state lines, and permit reimportation of drugs.

McCain's plan is vague about cost savings.
Holtz-Eakin from McCain's campaign said the average out-of-pocket cost for an individual health plan is $5,100. For those who are turned down for insurance, coverage would be available through a fallback "guaranteed-access plan."

McCain would use "the biggest lever available" by reforming Medicare, the federal health-care program for the elderly that sets the standard, in terms of cost and service, for private health-care plans, Holz-Eakin said.

If new standards for Medicare are enacted, all health-care providers, as McCain sees it, would have to become more conscious of the quality of care to compete in a retooled health-care system that pays a single price for a cardiac bypass surgery, not the tidal wave of bills that now deluge patients after such a procedure.

Holtz-Eagin said: "Providers would have an incentive to get their act together, to share records cheaply and quickly, and even to prevent the person from having the bypass if possible. There's no incentive to do anything now.

"This is something that has to happen. We have to get something done in America on health care. None of this should be done overnight. This isn't the kind of thing where you pass a bill and you're done."

Jay Khosla, a McCain health-policy adviser who worked for then-U.S. Senate Majority Leader Bill Frist, R-Tenn., emphasizes the competition aspect. "We need to ensure that drug companies, insurance companies, hospitals and every other aspect of the health-care system compete vigorously.

McCain's Proposed Health Plan and effect on Employer Sponsored Coverage

Adapted From AP Article

The unkown about Sen. John McCain's health plan is how many employers will react, and more speifically, how many would drop health insurance coverage for their workers because of the tax policy changes?

The Republican presidential candidate has proposed that all Americans buying health insurance get a refundable tax credit, $2,500 for individuals and $5,000 for families. At the same time, he would treat employer contributions toward health insurance like income, meaning workers would have to pay income, but not payroll, taxes on it.

Most health analysts say McCain's approach would strengthen the individual health insurance and small-group insurance market. And by strengthening that market, it will pull in workers now covered through their jobs.

Employers began offering health insurance as a benefit during World War II, when a labor shortage increased competition for workers. Wage controls limited employers' ability to offer higher salaries, so they offered benefits like health insurance. Health benefits were not a major expense initially, but they have become a significant part of payroll as health care costs have spiraled upward.

A poll of employer-insured voters conducted by the Kaiser Family Foundation found that nearly two-thirds thought it would be harder to find a health insurance plan that matches their needs and handle administrative issues if they were buying health insurance on their own. Eight in 10 said they thought it would be harder to get a good price for health insurance or get coverage if they were sick.