All the candidates for president have seen the importance of the issue of health care. The Dems have their ways of handling the issue, but the Repubs, especially McCain have come up with the most ridiculous. McCain’s proposal is a typical conservative approach some type of tax credit or such.
To do so he is proposing a major tax change that he hopes will make the insurance marketplace more competitive and less expensive in part by encouraging more people to buy health insurance on their own instead of receiving it from their employers.
The 71 percent of insured Americans who get their health coverage through their employers now enjoy a significant advantage because the money spent by employers on their health coverage is excluded from their taxable income. If employers chose to pay that share of a worker’s compensation as wages rather than benefits, the income would be taxable.
The tax treatment of health benefits has been criticized as both discriminatory and regressive, and some analysts believe it encourages workers to buy more coverage than they need, driving up health costs.
To end the disadvantage to those who do not buy insurance through employers, Mr. McCain proposes to eliminate the exclusion of health benefits from taxable income. In exchange, he would provide refundable tax credits of $2,500 to single people and of $5,000 to families, with the goal of stoking competition in the individual insurance market. The elimination of the exclusion would generate $3.6 trillion over 10 years, according to the McCain campaign, and that money would pay for the tax credits.
This free market approach is not the answer to the lack of adequate health care. On the other hand, neither Dem candidate has an adequate either.