NCPA - National Center for Policy Analysis


July 16, 2008

Sen. John McCain (R-Ariz.) is proposing the most radical overhaul of American health care policy in a decade and a half, says Michael Tanner, a senior fellow with the Cato Institute.

McCain would move us away from a system of employer-based health insurance.  He plans to provide all Americans with a $2,500 refundable tax credit for individuals and a $5,000 credit for families, regardless of how people obtain their insurance.

Most notably, McCain would allow people to purchase health insurance across state lines, a practice now prohibited, says Tanner.  Health insurance is largely regulated at the state level, and the different regulations and mandates in each mean prices vary widely from state to state:

  • For example, New Jersey imposes more than 40 mandated benefits; as a result, the cost of a standard health insurance policy for a healthy 25-year-old man in New Jersey costs an astonishing $5,580.
  • However, a similar policy in Kentucky, which has far fewer mandates, would cost him only $960 per year.

McCain would also allow people to purchase insurance through nontraditional groups, such as churches and professional organizations.

Finally, McCain wants to change not only who pays for health care, but how they pay for it.  McCain challenges the concept of traditional "fee for service" medicine and he rightly calls for greater transparency of health care costs and prices, says Tanner.

Steve Parente, professor of finance at the University of Minnesota, estimates that the McCain plan would cut the number of uninsured Americans by roughly half.  But equally important, McCain's proposal would drive down the cost of health care for everyone.

Source: Michael Tanner, "McCain's Health Care Plan is Radical -- And Right," New Hampshire Union Leader, July 14, 2008.

For text:'s+health+care+plan+is+radical+--+and+right&articleId=e8edb4d3-5c0a-45c6-b3c4-05f6fa8c35da


Browse more articles on Health Issues