Claim: “We should start on the road to coverage for all by building on the success of Medicare, Medicaid and the State Children’s Health Insurance Program (SCHIP), guaranteeing universal health care to the two groups most at risk: children and older Americans between the ages of 55 and 64 (who are not yet eligible for Medicare).” Rep. Rahm Emanuel (D-IL), Wall Street Journal, March 19, 2008.
Analysis: Statements like this makes one wonder what planet Rep. Emanuel is living on? The Medicare trustees recently announced that Medicare is on an unsustainable financial path — of course, it has been for years. Medicare’s unfunded liability (the difference between the amount Medicare is expected to spend versus how much it will receive in taxes) for the next 75 years is $36.3 trillion. And while news stories focused on Medicare’s Part A Trust Fund (which pays for hospital expenses), saying it will run out by 2019 — about 11 years from now — the fact is that there IS NO MONEY IN THE TRUST FUND.
Like Social Security, Medicare is a pay-as-you-go system. Payroll taxes coming in immediately go out to pay seniors’ current hospital costs. If more comes in than goes out, that surplus is borrowed by the federal government, which gives the trust fund an IOU. And the only way for the government to make good on those IOUs so the trust fund can pay its obligations is to borrow it or get it from taxes.
One of the biggest public policy challenges facing Congress is how to keep the system funded. And it will be either raising taxes, cutting benefits or, most likely, cut provider reimbursements — which simply means that fewer and fewer providers will participate. Or they will shift costs over to the private sector, which will only lead to Mr. Emanuel and his like-minded friends wailing that the private sector is soooo expensive — and needs the federal government to step in and control that too.
The Claim: The proposed McCain tax credit will not be enough to help a family.
The Analysis: One of the key components of Senator McCain’s health care proposal is a tax credit to help pay for health insurance. He has proposed a $2,500 credit for an individual and $5,000 for a family. (For more on tax credits see Helping the Uninsured Who Need It Most )
One of the criticisms has been that the credit will not be large enough to help a family pay for a health insurance policy. For example, Gary Claxton of the Kaiser Family Foundation says that the average cost of a individual’s health insurance policy in the group market is $4,300 a year, or $12,000 for a family.
The first question we need to ask is what kind of policies are those? Most likely they are comprehensive policies with generous benefits. By contrast there are some high deductible policies that a family could buy with the $5,000 tax credit. If people look on ehealthinsurance.com they will find that there are insurance policies available in different parts of the country that are $5,000 a year or less. In other words a person can get a basic health insurance policy that is entirely covered by McCain’s tax credit.
Of course, it is a high deductible policy, therefore there will be out of pocket costs. However, relatively few health policy experts believe that a subsidy should pay for ALL of the cost of a health insurance policy — though most agree that the subsidies should be greater for low income people. Depending on the type of policy that a family wants to buy and their income tax bracket, a $5,000 tax credit might be more helpful than the $15,000 tax deduction proposed by President Bush, and would certainly be more beneficial to low income people.
Claim: “She changed the lives of 6 million kids when she championed the bill that gave them health insurance.” (from a Clinton campaign ad)
At the time, most of us raising concerns about SCHIP thought then-First Lady Hillary Clinton supported the original State Children’s Health Insurance Program. But the legislation originated with Sen. Edward Kennedy (D-MA) in 1996, shortly after the passage of the Health Insurance Portability and Accountability Act. He spent several months trying to find a Republican co-sponsor. In early 1997, Sen. Orin Hatch (R-UT) signed on. Once Sen. Hatch lent his name to the legislation, it could no longer be credibly attached as “ClintonCare” for children. It was Sen. Hatch’s decision to co-sponsor the bill, more than anything else, that gave the legislation the push it needed to move forward.
Now, the Boston Globe has weighed in claiming that Clinton didn’t even really support the legislation. According to the Globe, quoting Sen. Hatch:
“The White House wasn’t for it. We really roughed them up” in trying to get it approved over the Clinton administration’s objections, Hatch said in an interview. “She may have done some advocacy [privately] over at the White House, but I’m not aware of it…I do like her,” Hatch said of Hillary Clinton. “We all care about children. But does she deserve credit for SCHIP? No - Teddy does, but she doesn’t.”
Senator Hillary Clinton (D)
http://hillaryclinton.com/issues/healthcare
The Claim: “If you have a plan you like, you keep it.”
The Analysis: Wrong. It might be true if she weren’t determined to fundamentally restructure how health insurers write policies, but she has made it very clear that under her reforms guaranteed issue and community rating will be applied to everyone in all markets: “Insurance companies won’t be able to deny you coverage or drop you because their computer model says you’re not worth it. They will have to offer and renew coverage to anyone who applies and pays their premium.”
And you can bet that there will be a lot of other restrictions and regulations to enforce her view of how the health insurance market should work.
Of course, the state of Kentucky tried to do something similar back in the mid-1990s. And the effort was so successful that by 1996, 45 insurers had pulled out of the state’s individual market, leaving only three. Eventually, the state decided to “reform the reforms,” eliminating all the things Clinton now wants to do, and insurers began to return.
Now, someone may claim that if Clinton is successful in imposing her reforms nationwide, the insurers will have no place to run. But those insurers may just pull out of certain markets such as the individual market entirely.
So how can Clinton claim that if you like your insurance you can keep it when she knows full well — or at least should know — that her reforms will so fundamentally change the market there is no guarantee who will still be selling health insurance or what they will sell?
Senator Barack Obama (D)
http://www.barackobama.com/issues/healthcare/#coverage-for-all
The Claim: “…will require that all children have health care coverage.”
The Analysis: The issue of an individual mandate has become a real catfight among Democrats, with Clinton claiming that she is the only one supporting “universal coverage” because she has an “individual mandate” that requires everyone to have it. For his part, Obama says we shouldn’t be penalizing uninsured people because they can’t afford coverage.
But no one, as far as I know, has asked what Obama intends to do to parents who don’t get their children covered.
Will those parents face a financial penalty for not enrolling their children? And if so, how is that significantly different than Clinton’s mandate? While his proposal may sound warm and fuzzy, a children’s mandate is really a mandate on the parents to do something — something those parents aren’t doing right now.
Moreover, millions of uninsured children are eligible for current health insurance programs such as Medicaid or the State Children’s Health Insurance Program (SCHIP) but aren’t enrolled. So why hasn’t the Illinois senator introduced legislation to force those parents with eligible children to do something? It’s not sweeping reform, true, but it is something that Obama could have done at any time in his few years as a senator, and yet he has done nothing.