Keep government programs out of health-care plans

Freedom Newspapers

Health care has become one of the most contentious issues in the presidential election. It brought some testy moments in the third debate. What is behind the two candidates’ health proposals?

Sen. John Kerry said in the debate that he’s proposing a system that would “let everybody buy into the same health-care plan senators and congressmen give themselves.”

An Oct. 12 Heritage study of the Kerry plan found that although the system congressmen use is “popular and successful” and “can be a useful model for reform based on consumer choice and competition,” there are problems with his proposal’s specifics. “(A) closer review reveals that it would incrementally expand federal control over the financing and delivery of health care and that it is fraught with unintended consequences for taxpayers, employers, and employees.”

The worst parts of the Kerry plan: Health care’s high costs would be shifted to taxpayers and “undermine existing incentives to contain costs and likely result in even higher taxpayer obligations and health care spending over time.”

“Beginning in 2006, federal taxpayers, rather than private insurance, would pick up the full cost of any case costing more than $30,000,” Robert E. Moffit, director of Heritage’s Center for Health Policy Studies and co-author of the think-tank’s analysis, explained. “This would displace private catastrophic health care.

“Medicaid expansion would cover 20 million more children,” he added, mainly those in the middle-class likely already to have private insurance, again displacing existing private coverage. “These Kerry programs will put us on a glide-path toward national health insurance.”

And, government regulation over the system would likely increase, also raising costs to taxpayers.

“The latest independent cost estimates of the Kerry health plan are more staggering, ranging from $1 trillion to $1.5 trillion for the first decade of operation,” the Heritage study says. Kerry’s proposal to increase taxes on those earning more than $200,000 wouldn’t cover the full cost, meaning “taxpayers would likely face additional significant tax increases.”

A second term for President Bush likely would mean continuation of his gradual movement toward some more private elements to the system, unfortunately combined with more government programs, including funding for his massive new Medicare prescription drug entitlement program that the administration estimates will cost $534 billion over 10 years.

Besides the drug plan, the president signed into law Health Savings Accounts, which are similar to 401(k) retirement accounts, and “a limited health care tax credit for certain displaced workers.”

The president’s major new initiatives include one that would continue privatization, “refundable health care tax credits to cover millions of uninsured Americans.”

Unfortunately, the president also wants an “expansion of traditional public programs … to cover uninsured children” and an “expansion of federally funded community health centers and clinics.”

The cost of the new plans would be $227.5 billion over 10 years and could “reduce the number of (48 million) uninsured by 17 percent or 8.2 million,” according to a Lewin Group study quoted by Heritage.

Whoever gets elected, next year Congress will have to make difficult choices. We hope it continues the privatization reforms begun by Bush, but avoids the increase in government programs proposed by both candidates.