Tuesday, October 07, 2008

McCain on health care: please clarify

Let’s get real about one thing: McCain’s plan for health care. I hope that it is simply a matter of his not explaining it well enough.

It’s OK to privatize the health plans, and for a number of companies (including Blue Cross and Blue Shield plans) to compete for customers. And it’s a good idea to remove the responsibility for health insurance from employers and let individuals purchase with pre-tax dollars. McCain wants to transfer the pre-tax benefit from employers back to individuals. Without paying for health care, employers may be able to compete better internationally and may be able to hire more people.

But first of all, there have to be enough pre-tax dollars available to each individual for health insurance. That’s likely to be about $8000 per family, not $5000. That could mean a grant to low income people.

And there should be some reward for finding less expensive plans and letting companies offer them. That could mean that an emphasis on catastrophic care, letting consumers use pre-tax money for preventive care, and letting consumers keep the difference.

Then, there is the paradox. People with pre-existing conditions have to be protected. Regulations, said to say, or state pools, need to provide for their being able to purchase acceptable insurance within the allotments. Even Donald Trump, who says he is a Republican, says that it is unconscionable (and stupid) not to take care of the sick, and says he would do something about it if he ever ran for office. The premiums for the public as a whole, purchased individually, have to be set up as group premiums rather than individual, and the same discounts with health care providers need to be offered through insurance companies.

And protecting people with pre-existing conditions, while disturbing to the idea of moral hazard, perhaps, just makes economic sense. Otherwise we wind up treating them in emergency rooms, and everyone pays.

McCain and Palin, please explain this again.

Update: Oct. 8

Robert Laszewski has an analysis on John McCain's health care plan on "The Health Care Blog" here.

The same writer discusses Barack Obama's plan on the same blog, here here. An important feature is a National Health Insurance Exhcange and government vetting of providers for individuals. Timothy Johnson covered this on ABC "Good Morning America" this morning. I'll come back to all of this in more detail soon.

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