Imagine a new health care proposal that does the following:

• Continues employer-based health insurance.
• Maintains Medicare and Medicaid in their current form, though reimburses healthcare providers based more on quality measures, not just volume.
• Maintains individual and familyaccess for purchasing insurance, but allows crossing state lines to take advantage of premium cost differences.
• Prevents health insurers from dropping their insured and allows job-to-job portability.

Some might call it an improvement over the flawed American healthcare system. Critics might call it an anemic attempt at a fix, too little, too late. Such have been some of the comments aimed at Senator John McCain’s healthcare reform proposal.

The essence of the McCain healthcare proposal is a fundamental change in the way we fund healthcare today: Provide disincentives to employer-funded access to healthcare. It achieves this by eliminating the employer tax break that has provided employers a tax incentive to pay employee healthcare premiums. In its place, individuals will receive a $2,500 annual tax credit and families will receive a $5000 tax credit.

In this scheme, employers will, in effect, be forced to bear a substantial increase in costs for employee healthcare coverage, or simply shift a large(r) share of the burden to the employee.

Will the employee be better off? Though the tax credit covers only a fraction of the annual healthcare insurance premium (average $12,000 per year for a family of four), the McCain plan also provides for steps to reduce healthcare costs, *hopefully* reducing healthcare insurance premiums.

What is not included in the McCain plan...

Absent from the McCain proposal is a plan to create a federally-funded and centrally-run healthcare net, as proposed by the Democratic candidates in various forms. In fact, he has opposed the concept of universal healthcare, arguing that Americans should not be forced to enroll in any program, public or private.

Senator McCain’s plan instead proposes a set of mandates that will be charged to state governments to implement a healthcare safety net for the under- or uninsured. Enrollment will not be mandatory. He calls this the Guaranteed Access Plan, or GAP. He envisions state-runprocesses, allowing variation from state to state to suit local needs, but partially federally-subsidized. He proposes to establish a non-profit corporation that contracts with insurers to provide low-cost coverage to the uninsured, with assistance provided to those who cannot afford it. (This part is not entirely clear in the plan.)

“Has any candidate insisted that genuine and effective health care reform requires accountability from everyone: drug companies, insurance companies, doctors, hospitals, the government and patients? Yet that is the truth upon which any so-called solution must be based...

“Democratic presidential candidates are not telling you these truths. They offer their usual default position: If the government would only pay for insurance everything would be fine. They promise universal coverage, whatever its cost, and the massive tax increases, mandates and government regulation that it imposes. I offer a genuinely conservative vision for health care reform, which preserves the most essential value of American lives — freedom.” -Presidential candidate, Senator John McCain, October, 2007