McCain Offers Market-Based Health Plan

Sen. John McCain and his wife, Cindy, tour the H. Lee Moffitt Cancer Center & Research Institute at the University of South Florida in Tampa.
Sen. John McCain and his wife, Cindy, tour the H. Lee Moffitt Cancer Center & Research Institute at the University of South Florida in Tampa. (By Mary Altaffer -- Associated Press)
By Michael D. Shear
Washington Post Staff Writer
Wednesday, April 30, 2008

TAMPA, April 29 -- Sen. John McCain on Tuesday rejected calls by his Democratic opponents for universal health coverage, instead offering a market-based solution with an approach similar to a proposal put forth by President Bush last year.

McCain's belief in the power of the free market to meet the nation's health-care needs sets up a stark choice for voters this fall in terms of the care they could receive, the role the government would play and the importance they place on the issue.

Democratic Sens. Barack Obama (Ill.) and Hillary Rodham Clinton (N.Y.) have vowed government action to fulfill what they cast as a moral right for Americans to have health insurance. They favor mandates for coverage; McCain (R-Ariz.) proposes tax incentives. Obama and Clinton would impose new regulations on insurers; McCain's plan is designed to avoid direct regulation. The Democrats would build on the current employer-based system; McCain would shift to a more individual approach.

In a speech at a cancer research center here, McCain dismissed his rivals' proposals for universal health care as riddled with "inefficiency, irrationality and uncontrolled costs." He said the 47 million uninsured Americans will get coverage only when they are freed from the shackles of the current employer-dominated system.

McCain's prescription would seek to lure workers away from their company health plans with a $5,000 family tax credit and a promise that, left to their own devices, they would be able to find cheaper insurance that is more tailored to their health-care needs and not tied to a particular job.

Under McCain's plan, $3.6 trillion worth of tax breaks over a decade that would have gone to businesses for coverage of their employees would be redirected to individuals, regardless of whether they are covered by a company plan.

"Insurance companies could no longer take your business for granted, offering narrow plans with escalating costs," McCain said. "It would help change the whole dynamic of the current system, putting individuals and families back in charge, and forcing companies to respond with better service at lower cost."

Health experts predict a robust debate in the general-election campaign as anxiety about the cost of health care grows against the backdrop of a worsening economy, higher gasoline prices and rising unemployment.

"Health will increasingly become reframed as part of the broader pocketbook and economic concerns," said Drew Altman, president of the Henry J. Kaiser Family Foundation, a nonpartisan health research group. "The real health reform debate hasn't really begun -- the debate between the Democrats and the Republicans about the fundamental differences in how to reform health care."

Altman's group released a poll Tuesday showing that nearly 30 percent of Americans have faced a serious problem in paying for medical care or insurance in the past year. The survey also found that 25 percent of workers made job decisions based primarily on health-coverage considerations.

McCain's proposal is similar to one that Bush put forth in his 2007 State of the Union address. That plan, which would have replaced employer tax breaks for health insurance with a $15,000 tax deduction for married couples, flopped in Congress, failing to get even a committee hearing.

McCain's plan is aimed primarily at giving individuals the power to make health-care decisions by granting the same tax breaks for insurance whether workers get a policy from an employer or on their own. Aides call it a "radical" rethinking of health care that would drive costs down and give people more choice.

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