NCPA - National Center for Policy Analysis

Kerry Would Bust the Budget on Health Care

March 18, 2004

There are major differences between the presidential candidates' plans to deal with the medically uninsured, says NCPA Senior Fellow Devon Herrick.

President Bush's plan emphasizes helping uninsured Americans obtain private health insurance. Sen. Kerry's plan emphasizes expanding eligibility for Medicaid and SCHIP (the state children's health insurance program to an additional 4 million people, including children in households earning up to $55,000 annually. His package also includes subsidies for private insurance -- but most of those are for employer health plans, not individuals.

Bush has proposed a tax credit of $1,000 per individual (up to $3,000 per family) to help low-income Americans buy their own health insurance. Additionally, Bush has called for an "above-the-line" tax deduction for premiums for individually purchased health policies coupled with Health Savings Accounts (HSAs).

There is no cost estimate yet for Bush's proposed tax deduction; however, the administration has produced estimates for the tax credits, and Kenneth Thorpe, of Emory University, has produced estimates for the Kerry plan. Based on those estimates:

  • The Bush tax credits would cost $70 billion over 10 years and insure 4.2 million currently uninsured people, at a cost of $1,667 per newly insured person.
  • The Kerry plan would cost $895 billion over 10 years, and if all 27 million individuals who qualify were enrolled, the cost per newly insured individual would be $3,315.
  • However, the cost per person of Kerry's plan may be much higher if fewer people enroll because those eligible include 14 million people who already qualify for the Medicaid or SCHIP programs and have not enrolled.

Under Kerry's program, taxpayers will pay at least $10,000 to insure a family of three -- a lot more than insurance costs in the marketplace.

Source: Devon M. Herrick, "Bush versus Kerry on Health Care," Brief Analysis No. 468, National Center for Policy Analysis, March 18, 2004.

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http://www.ncpa.org/pub/ba468

 

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