McCain Health Plan

John McCain's health care plan contains few details, but here are the main principles:

The McCain plan uses the tax code to push Americans away from the health insurance coverage they get at work and into the individual insurance market. Currently, employer payments for health insurance are not taxable to the employee as income. The McCain plan would end that tax exemption, eliminating the incentive for employer-based coverage. McCain would instead offer a tax credit of $5,000 for families/$2,500 for individuals for health insurance payments, which is nowhere near enough money to compensate for the loss of employer-based coverage. [McCain On the Issues [1]] Nine out of 10 Americans with private health insurance—158 million Americans—receive it through an employer. [Henry J. Kaiser Family Foundation [2]] So the McCain plan directly threatens the coverage of more than half of all Americans.

The McCain plan fails to require insurance companies to cover patients with preexisting health conditions. Pushing Americans to individual insurance plans means that those with preexisting health conditions—from asthma to cancer—will be unable to obtain affordable coverage. For the 56 million Americans with chronic illnesses who are currently covered by benefits they get at work, the effects would be devastating. [Center for American Progress Action Fund [3]] McCain concedes this point and now claims he “will work with governors to develop a best practice model that states can follow” to create health insurance products for “high risk” patients. However, this fig leaf fails to cover the ugly truth—although 34 states have some kind of high-risk health insurance pool, there are no successful state models for insuring a large number of individuals who are denied coverage because of preexisting health conditions. [Health Insurance Resource Center [4]]

The McCain plan wipes away nearly all existing regulation of health insurance, leaving us to deal with private insurance companies on our own. The McCain plan would overrule patient protections in state law by allowing people in one state to purchase insurance from any other state. Just as credit card companies moved their operations to Delaware to avoid state regulations, health insurance companies would move to states with the least regulation. As a result, states would “race to the bottom”—eliminating existing regulations—in order to attract those companies. Right now, mammograms must be covered in every state except Utah—we’d lose that. Mental health must be covered in every state except Alaska, North Carolina and Wyoming—we’d lose that. Mothers who give birth are guaranteed a minimum hospital stay in every state except Wisconsin—we’d lose that. Breast reconstruction must be covered in every state except two. Family health insurance must cover adopted children in all states except seven. Chiropractors must be covered in all states but four. There are nearly 2,000 state laws protecting patients from inadequate health insurance—we’d lose them all. [Council for Affordable Health Insurance [5]]