NCPA - National Center for Policy Analysis


April 4, 2008

Which presidential candidate has the best health care plan?  Both of the Democratic candidates' plans have huge flaws, but on balance John McCain's is better, says Fortune Magazine.

McCain's main pillar is the elimination of a tax break that employees receive if their employer provides their health care.  He suggests moving to system of personal tax breaks:

  • Say you're earning $100,000 a year and your company provides about $9,000 toward your $12,000 family premium, which is about average; today you're taxed only on the $100,000.
  • Under McCain's plan, you'd also pay on the $9,000; that could mean an extra $3,000 or so in federal taxes alone.
  • To compensate for the extra levy, McCain would provide a $2,500 federal tax rebate for individuals and $5,000 per family, meaning a family would simply subtract $5,000 from its tax bill, the equivalent of a big cash payment.

Besides eliminating the employer exclusion, McCain's plan boasts another nice feature, says Fortune.  It would allow consumers to choose an insurance plan that suits their stage of life:

  • Nine states, including New York, California and Texas already require that as many as 50 benefits be covered, a list that ranges from in vitro fertilization to mental health services to prescription drugs.
  • These requirements increase the cost of insurance; they're a major reason young people have dropped their coverage.
  • Under the McCain plan, insurers in any state would be free to offer the plans with a vast variety of deductibles, co-pays and benefits.

The price of health care is never going to get under control, says Fortune, until patients get what they deserve: the right to be customers too.

Source:  Shawn Tully, "Why McCain has the Best Health-Care Plan," Fortune, March 11, 2008.

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