Senators John McCain and Barack Obama agree that the United States' healthcare system needs reform. Both candidates see the same basic problems: access to healthcare, along with the cost and quality of healthcare. So as President Bush completes his final term, now is a good time to consider what changes are in store for healthcare.

Framing the Problem

Statistics don't lie. Nearly 50 million Americans lack health insurance. Furthermore, with premiums having risen four times faster than wages over the past six years, there are millions more who cannot afford the rising cost of private coverage. And with about 100,000 Americans dying from medical errors in hospitals each year and less than four cents of every healthcare dollar spent on prevention and public health, few would question that the overall quality of U.S. healthcare could be improved.

McCain's Healthcare Platform

If elected president, Senator McCain plans to implement several policy changes to improve the U.S. healthcare system. First, he would attempt to deregulate the health insurance industry to allow people to purchase policies across state lines in order to increase competition among insurers, thereby decreasing prices. He would also offer various tax credits, such as $2,500 for individuals and $5,000 for families, to help people pay for insurance coverage. His staff is considering the idea of risk-rating these tax credits so that those with pre-existing health conditions might receive more money. McCain believes tax credits have the double benefit of allowing individuals to make their own insurance choices tailored to their individual needs, while preventing insurers from taking business for granted and offering narrow plans. The senator also wants to make insurance more portable. Individuals, he believes, should be able to retain their same insurance coverage from job to job, if they retire, or if they leave the workplace. On the cost-cutting front, McCain would attempt to reform payment systems in Medicare and Medicaid to pay for diagnosis, prevention and care coordination, not preventable medical errors or mismanagement. A medical malpractice reform initiative to eliminate lawsuits directed at doctors who followed clinical guidelines and adhered to patient safety protocols would accompany his payment reforms. Finally, McCain wants to improve healthcare quality by requiring more transparency regarding treatment options, outcomes and physician records to allow patients to become more informed consumers. Informed healthcare consumers, the logic goes, should force providers to provide higher-quality services at lower prices, or else risk losing business.

Obama's Healthcare Platform

The central element of Senator Obama's healthcare plan is to provide health insurance coverage to every American through public or private means. Individuals who do not qualify for Medicaid or the State Children's Health Insurance Program and who are unable to afford insurance would be given a subsidy whereby they could purchase private insurance. The benefit package offered under this new public insurance program would be similar to that offered to federal employees. Estimates for the annual cost of such a program run at $50 to $65 billion annually. Obama expects to finance the plan by rolling back Bush tax cuts for people making over $250,000 and requiring all but the smallest companies in the United States to contribute to the health coverage of their employees. Separately, Obama wants to create a new federal agency called the National Health Insurance Exchange to act as a watchdog for the private insurance market. This new agency would have some say over services provided by private insurers and premiums charged. Under this new regime, insurers would operate much like public utilities — as private companies operating within an artificial marketplace run under strict government control and regulation. On the cost-cutting and quality fronts, Obama would like to require full transparency about healthcare costs and outcomes. He thinks that hospitals and providers should collect, track and publicly report measures of healthcare quality such as preventable medical errors, hospital-acquired infections and nurse-to-patient ratios. Lastly, Obama plans to invest at least $10 billion a year over the next five years to drive the healthcare market toward the broad adoption of electronic health information technology.

The Decision

So while the candidates agree on the problems facing the healthcare system, their proposed solutions differ drastically. Generally speaking, McCain favors using the tools of free-market reforms, tax incentives and deregulation, while Obama leans toward government mandates, regulations and subsidies. With so little overlap in the candidates' visions for healthcare reform, it is easy to see why the issue is on the forefront of voters' minds as they ponder their November decision.