Should Sen. Barack Obama (D-IL) win the election, most health care analysts predict that SCHIP expansion will kick-off a larger effort of health care reform. In 2007, despite broad bipartisan support and the urging of governors, President Bush vetoed two separate bills (HR 976 and HR 3963) that would have extended health care coverage to some 10 million children.

In preparation for the next SCHIP battle, the Wonk Room has compiled the voting records of politicians up for re-election who opposed SCHIP expansion:

Name	HR 976	HR 3963
Sen. Mitch McConnell (R-KY)	No	No
Sen. Elizabeth Dole (R-NC)	No	No
Sen. Saxby Chambliss (R-GA)	No	No
Sen. Roger Wicker (R-MS)	-	No
Rep. Michelle Bachmann (R-MN)	No	No
Rep. Bill Sali (R-ID)	No	No

Along with the president, the above complained that the bipartisan compromise would “raise taxes on working Americans,” add “nonpoor children to the program” and encourage “many to drop private coverage, to go on the government-subsidized program.”

Despite their claims, however, “the overwhelming majority of children who would gain health coverage under the emerging agreement are precisely the low-income children the President says he wants to focus on.” A Congressional Budget Office analysis of the SCHIP the first bill found that the overwhelming majority of those who would gain coverage under the bill have incomes below states’ current SCHIP eligibility limits. Two-thirds of “those who gain SCHIP coverage…would otherwise be uninsured.”

The importance of covering children cannot be overstated. Publicly insured children are “more likely to have asthma, learning disabilities, and/or health conditions that require regular treatment with prescription medications.” Medicaid and SCHIP, in turn, “provide access to the medical care that can treat these problems and help children grow, function, and learn more effectively.”

Ninety-one percent of Americans want “Congress to help states cover more uninsured children.” The next President and Congress will have a unique opportunity to channel this consensus towards concrete health care reform, of which SCHIP will only be the beginning.

In today’s Wall Street Journal, Robert Carroll lays out the conservative philosophy for health care reform. Like Sen. John McCain, Carroll believes that the employer-insurance subsidy contributes to higher health care costs by encouraging overutlilization of care. “The subsidy encourages people to buy bigger policies that cover more, and leads to greater health-care spending,” Caroll argues.

Eliminating the income-tax exclusion “should reduce private health-care spending; to the extent this reduced the cost of health care, it should also put downward pressure on the growth of Medicare and Medicaid costs.”

But in shrilling for McCain’s plan to dismantle the employer-based system and push Americans into high-deductible plans in the individual market, Carroll gets the consequences of leaving individuals responsible for financing their own health care entirely backwards.

According to a Commonwealth study, for instance, the major effect of a high deductible is likely to be “a one-time shift in spending from premiums to patient out-of-pocket outlays.” Premiums to employers and workers would be reduced by 10 to 15 percent, “but most of that reduction would be a reduction in covered medical outlays and a shift to out-of-pocket expenses for which patients would be responsible,” a Commonwealth study concluded.

Shifting the risk and cost of health insurance onto the individual will increase medical debt and discourage preventive care utilization. In fact, adults enrolled in high-deductible insurance plans (with deductibles of $1,000 or more) reported one of four cost-related access problems:

- because of cost did not fill a prescription

- did not see a specialist when needed

- skipped a recommended test treatment, or follow-up

- had a medical problem but did not see a doctor

Encouraging more people to skimp on preventive care, could fuel growth in health care spending, not reduce it. In fact, advocates of so-called consumer driven health care plans, miss the forest for the trees. The sickest 20 percent of Americans account for 80 percent of health care costs. Yet consumer plans would do little to lower the costs of their care and may actually add to their ranks.

Carroll proclaims that “Almost Everyone Would Do Better Under the McCain Health Plan.” In truth, it’s difficult to think of anyone — the not-yet sick or the already sick — who would benefit from punting needed care because of higher cost.

The Wall Street Journal released an editorial on Saturday with the outrageous argument that Sen. Barack Obama’s “own health-care advisers support plans much like Mr. McCain’s,” which replaces the current employer-based coverage tax preference with a straight tax credit, “or at least they did before joining up with Mr. Obama.” The Journal’s erroneous claim rests on the fact the Obama advisors Jason Furman and David Cutler – like other notable Democratic voices in health care arena – have commented that tax credits could be part of health reform and that our current tax exemption for health insurance could (or should) be revamped. Sen. McCain has called for tax credits and eliminating the health insurance tax exemption on income taxes.

But the Journal pulls quotes out-of-context and completely ignores the fundamental differences in the thoughtful, comprehensive Democratic prescriptions for change as compared to the radical approach from Sen. McCain.

While the employer-based system isn’t perfect, it plays a crucial role in connecting Americans to coverage by encouraging risk pooling through employer policies and guarding against adverse selection. Ending that employee tax deduction without additional reforms—reforms opposed by Sen. McCain—will weaken our health care system. Sen. McCain’s health care plan is based on ultra-conservative ideology: give every American a flat, “one-size-fits-all” tax credit; end government oversight of insurance companies; force people to buy insurance on their own; and, let the market run, no matter the consequences on real people. Even former Federal Reserve Chairman Alan Greenspan has now conceded that lazzie-fare economics is a failed belief.

In the Health Affairs article cited by the Journal in making their flawed argument, Furman himself makes the case against a McCain-type plan. A plan like that proposed by Sen. McCain could “cause a large number of employers to drop coverage . . . the number of uninsured people would rise.” What are Furman’s suggestions for reforms to be paired with a change in the tax code?

- Expanding Medicaid and SCHIP

- Creating an insurance exchange

- Reinsurance

- Allowing people to buy into public plans

Sound familiar? Yes, those would all be the core elements of the Obama health care plan. Read more