McCain emphasizes market-driven reform

October 7, 2008

Senator John McCain plans to use business competition to improve the quality of health insurance and to lower prices and increase insurance plan portability.

He would eliminate the employer tax deduction for health insurance and create new tax deductions for families and individuals. This approach could greatly reduce employer-sponsored health benefits and encourage strong business opposition to the plan by denying businesses a $120 billion annual tax benefit.

Tax reforms could broaden coverage choices for consumers and increase competition among insurance plans, according to McCain. While still having the option of employer-based coverage, individuals would receive a direct refundable tax credit of $2500. Families would be provided a $5000 credit to offset insurance costs and could choose the plans independently. Federal regulations would be modified so individuals could stick with their preferred insurer as they move from job to job.

McCain also supports health savings accounts for families, calling them "an important step in the direction of putting families in charge of what they pay for."

McCain emphasizes the need to address access problems for individuals who either lack prior group coverage or have an otherwise uninsurable preexisting condition. He promises to work with state governments to establish a market-based Guaranteed Access Plan. An example approach would establish a nonprofit corporation that would contract with insurers to cover patients who have been denied insurance and could join with other state plans to enlarge pools and lower overhead costs. Reasonable limits would be placed on premiums, and the costs for low-income patients could be subsidized.

The New York Times has reported that state-operated high-risk pools now cover only 207,000 people. Premiums are high, sometimes double the standard rate, but they still fall short of paying the costs of care received by some beneficiaries.

A costly healthcare reform plan would compete with McCain's pledge to balance the federal budget by 2013.

McCain promises to lower drug prices with rules to allow the safe re-importation of drugs and faster introduction of generics. A new public health infrastructure built by the McCain administration would emphasize disease prevention, early intervention, healthy hab¬its, new treatment models, and the use of information technology to reduce healthcare costs, including technology that allows doctors to practice across state lines.

McCain's IT provision could have a direct bearing on radiology. Imaging could become even more engrained in routine diagnostic processes as it becomes easier to integrate sample images into a patient's electronic medical record. Teleradiology and radiology outsourcing could get boosts if McCain lowers barriers to the practice of medicine across state borders.

Like other conservative Republicans, McCain supports tort reform to eliminate lawsuits against physicians who practice within accepted guidelines. He asks for national standards for measuring treatment outcomes.

--JB