We’ve discussed McCain’s devious plan to destroy the American Healthcare system, and replace it with a wink; Paul Krugman sketches what the end result would turn out to be quite clearly:
But the people gaining insurance would be those who need it least: relatively healthy Americans with high incomes. Why? Because insurance companies want to cover only healthy people, and even among the healthy only those able to pay a lot in addition to their tax credit would be able to afford coverage (remember, it’s a $5,000 credit, but the average family policy actually costs more than $12,000).
Meanwhile, the people losing insurance would be those who need it most: lower-income workers who wouldn’t be able to afford individual insurance even with the tax credit, and Americans with health problems whom insurance companies won’t cover.
And in the process of comforting the comfortable while afflicting the afflicted, the McCain plan would also lead to a huge, expensive increase in bureaucracy: insurers selling individual health plans spend 29 percent of the premiums they receive on administration, largely because they employ so many people to screen applicants. This compares with costs of 12 percent for group plans and just 3 percent for Medicare.
In short, the McCain plan makes no sense at all, unless you have faith that the magic of the marketplace can solve all problems. And Mr. McCain does: a much-quoted article published under his name declares that “Opening up the health insurance market to more vigorous nationwide competition, as we have done over the last decade in banking, would provide more choices of innovative products less burdened by the worst excesses of state-based regulation.”
I agree: the McCain plan would do for health care what deregulation has done for banking. And I’m terrified.
Those who can afford it already won’t be affected, much, by this plan, but the rest of us will be screwed. Note: I did the math for myself, and I would come out about even, at the moment. But, my rates went up 14%1 this year, and about the same last year2, and presumedly would increase again next year. So the McCain healthcare tax credit would soon be insuffecient for paying for my plan, and my deductible is quite high already.Footnotes: