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The text below is an excerpt from the complete document. Read the full analysis or a summary of both candidates' plans in PDF format.

Abstract

The McCain health care plan represents a philosophical advance over many proposals, principally in its commitment to redistributing the current tax exemption for employer-based health insurance. However, the plan raises more concerns than it addresses. McCain’s proposal would dramatically change how many obtain insurance, make coverage less accessible for those with health problems, have a high budget cost, but have little effect on the number uninsured. These problems could be addressed by providing a guaranteed source of adequate, affordable coverage; phasing-out the tax exemption slowly; larger subsidies to the low-income; spreading health risk broadly; and a significant commitment to cost-containment.

Overall Assessment

The McCain health care plan represents a philosophical advance over many other health care proposals, principally in its commitment to redistributing the current tax exemption for employer-based health insurance. However, the plan raises more concerns than it addresses. The plan would

• provide a refundable tax credit that is more valuable to low-income workers than the current tax exemption for employer-based insurance, though the credit is not adequate to make coverage affordable for many;
• make insurance coverage less accessible and affordable for those with high health care needs;
• increase coverage among the currently uninsured through the nongroup market but reduce the number already covered by employers, leaving about the same number of people uninsured;
• have a high budget cost, at least in its early years.

In brief, McCain’s proposal would dramatically change how many Americans obtain health insurance coverage, make coverage less accessible for those with health problems, have a high budget cost, but have little effect on the number uninsured.

Read summaries of both candidates' proposals.

(End of excerpt. The entire analysis or a summary of both candidates' plans are available in PDF format.)

The nonpartisan Urban Institute publishes studies, reports, and books on timely topics worthy of public consideration. The views expressed are those of the authors and should not be attributed to the Urban Institute, its trustees, or its funders.

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