October 22nd, 2008
12:55 PM ET

Candidate's health insurance proposals revisited

By Caleb Hellerman
CNN Medical Senior Producer

With the election two weeks away, we’ve been talking more about candidates’ health care proposals. It’s impossible to explain all the details at once, and whenever we post something, like Sanjay did last week, you readers are not shy about pointing to what we left out. Here’s more to chew on.

This morning, the Journal of the American Medical Association is running articles by both John McCain and Barack Obama, explaining their plans to overhaul health care. The centerpiece of McCain’s plan is a tax credit of $2,500 for individuals and $5,000 for families, to help them buy insurance.

Here’s what I find interesting: McCain has gone out of his way not to emphasize what a big change this would be. Right now, about 62 percent of Americans have insurance through their job, and just 5 percent buy coverage on their own. That’s because there’s a big incentive for companies to provide coverage: They get to write off the expense on their taxes. It’s less expensive to buy you insurance than pay the money as salary.

For better or worse, McCain wants to change that. He wants to level the field by offering a similar tax break to individuals. He argues that with more individual buyers out there, more companies will offer individual policies, and you’ll have more options – at lower cost – than you do now. You also won’t have to worry about losing insurance if you switch jobs.

The risk – as Obama likes to point out – is that the people buying individual plans will probably be the younger and healthier workers. That would presumably raise insurance costs for companies, and could start pushing them to drop coverage. That’s especially worrisome for anyone who’s already sick, with a so-called “pre-existing condition.” Some McCain critics accuse him of wanting to eliminate the employer tax break altogether. Those who want to get rid of the employer tax break – like McCain supporter Sen. Tom Coburn, an Oklahoma Republican - say that would help most people, because if your employer isn’t buying you health insurance, it can make it up by paying higher wages. But this spring, McCain’s campaign said flatly: Eliminating the tax break is not in the cards.

Obama’s health proposal is more conservative, as in cautious. It would build on the existing system. If you like your health coverage, you can keep it – but you’ll also have the option of buying into a new government health insurance plan, with the same benefits as are available to members of Congress. Obama also wants to require large businesses to provide insurance to employees, or else pay a fine. (He hasn’t said what size businesses should be exempt.) And he would give subsidies to help uninsured Americans buy into Medicaid or SCHIP, the children’s insurance program that’s run by the states.

It’s a little something for everyone. Critics say it’ll be wildly expensive. After all, health care costs are growing faster than inflation. Just building on the current system might not be sustainable, especially in the shadow of massive budget deficits.

Who’s got it right, McCain or Obama?

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Get a behind-the-scenes look at the latest stories from CNN Chief Medical Correspondent, Dr. Sanjay Gupta, Senior Medical Correspondent Elizabeth Cohen and the CNN Medical Unit producers. They'll share news and views on health and medical trends - info that will help you take better care of yourself and the people you love.