ISSUES AND THE PRESIDENTIAL CANDIDATES: HEALTH CARE

McCain on Health Care

by Marilyn Werber Serafini

Sat. Jun 7, 2008


Specific Policy Positions

The uninsured

The federal government would provide tax incentives for people to buy health insurance. People would be allowed to purchase out-of-state insurance. McCain promises to help states develop "guaranteed access plans" to make it easier for individuals who are in poor health or have pre-existing problems to get insurance.

Consumer impact

All individuals could get a refundable $2,500 tax credit ($5,000 for couples) as an incentive to buy health insurance. If a policy cost less than the amount of the tax credit, the consumer could deposit the remainder into a health savings account. Veterans could transfer their VA benefits to other medical providers. Individuals could get insurance through any organization or association, including an employer, and workers could carry policies from job to job. McCain would develop faster routes for approval of "safe, cheaper" generic drugs, including biologics. He would develop safety protocols that allow Americans to import FDA-approved drugs.

Economic impact

The federal government would have to pay for the proposed refundable tax credit. The tax exclusion for employer-sponsored health care would be ended. Federal health care programs would reimburse medical providers more for positive outcomes, for coordinating care, and for preventive services. Several proposals could reduce costs for medical providers by, for example, eliminating "frivolous lawsuits and excessive damage awards."

Employer-provided health insurance

McCain focuses less on maintaining the employer-based health care system than on giving individuals incentives to buy insurance. He would allow small businesses and also the self-employed to buy insurance through any organization or association.

Performance and innovation

McCain would create national standards for electronic health systems. He would require medical providers to make information about outcomes, quality, and costs readily available to the public. He supports innovative care delivery systems, such as clinics in stores.

Key Advisers

Douglas Holtz-Eakin, a former director of the Congressional Budget Office and a former chief economist for President Bush's Council of Economic Advisers, heads McCain's health care team. He was the chief architect of McCain's proposal to replace the existing tax exclusion for employer-sponsored health plans. Dan Crippen, however, constructed most of McCain's health plan. Crippen is another former CBO director, and he was chief counsel and economic policy adviser to then-Senate Majority Leader Howard Baker. Others consulted about McCain's health care proposal include Regina Herzlinger, a professor of business administration at Harvard Business School, and Thomas Miller, a resident fellow at the American Enterprise Institute and a former health economist at the congressional Joint Economic Committee.

Record

SCHIP reauthorization: Voted against 2007 legislation to expand the State Children's Health Insurance Program with $35 billion in new funding, financed by a tobacco-tax increase.

Prescription drug imports: Was one of five Senate Republicans to co-sponsor 2004 legislation to allow pharmacists and wholesalers to import FDA-approved drugs from Canada and Europe.

Medicare prescription drugs: Was one of eight Senate Republicans to oppose final passage. Voted to means-test the drug benefit and allow states to provide health coverage to legal immigrants who were children or pregnant women.

Generic drugs: Sponsored Senate-passed legislation in 2002 that would have tightened patent laws to make generic drugs more readily available.

Patients' bill of rights: Was lead GOP sponsor of bipartisan 2001 legislation to allow patients to sue managed care plans.

Key Interest Groups

U.S. Chamber of Commerce: It advocates an approach similar to McCain's, proposing tax breaks for individuals who don't get health insurance through an employer, tax credits to help lower-income people buy coverage, and expansion of health savings accounts.

American Medical Association: Its approach is similar to McCain's, advocating replacing the current tax exclusion for employer-based insurance coverage with tax credits or vouchers to help individuals buy insurance.

Families USA: It criticizes McCain's health care proposal, saying his plan would fail to make care more affordable and accessible. "Senator McCain's proposal takes us in the opposite direction and makes significant problems worse over time," Executive Director Ron Pollack said.

America's Health Insurance Plans: The group shares several priorities with McCain, including allowing all consumers to purchase health insurance with pretax dollars.