Voters See Very Different Healthcare Plans from Obama, Clinton, and McCain

In September, when Democratic presidential candidate Hillary Clinton announced her plan for universal healthcare, blue-and-white signs proclaimed the "American Health Choices Plan." The backdrop at the Des Moines hospital where she took the podium was stamped with dozens of minilogos repeating the same slogan. The message was clear to anyone who remembered the missteps of the healthcare reform plan she spearheaded during the Clinton administration: This time, you get to choose.

Some healthcare workers are among those who are pushing for universal health coverage.

Despite candidates' efforts to highlight their plans' special features, so far the debate over healthcare reform hasn't seemed to offer voters much in the way of choice. Through the long primary season, voters have been parsing the details of Senator Clinton's and Sen. Barack Obama's plans. But with more similarities than differences, it's been hard to get too heated about who's got the best ideas to fix the system. Now that Sen. John McCain is the sole Republican candidate, that's about to change. When the Republican proposal gets an airing, voters will be confronted with two starkly different visions for reforming healthcare. Although healthcare remains a top domestic issue, broader economic worries may overtake voters' appetite for major systemic change, shifting the focus to nuts-and-bolts concerns about their own coverage and how to afford it instead. But the candidates are focusing on major reform, and, when referring to healthcare reform, they generally focus on two primary areas: accessibility and affordability. Typically, Democratic plans emphasize ways to get as many people covered as possible, while Republicans stress bringing down costs.

Not since the decisive failure of healthcare reform during the Clinton administration in the early 1990s has there been such intense interest in this issue. Blame the increasing number of uninsured—47 million at last count—and relentlessly rising costs, say analysts. "The middle class is worried about affordability. They see it in rising premiums and in copays," says Len Nichols, director of the health policy program at the New America Foundation. Premiums rose 6.1 percent last year, more than twice the rate of inflation and significantly outstripping the 3.7 percent increase in workers' earnings, according to the Kaiser Family Foundation's 2007 Employer Health Benefits Survey. Since 2001, healthcare costs have increased 78 percent, according to Kaiser. Meanwhile, high healthcare costs make it increasingly difficult for businesses to compete against companies overseas that typically don't offer health benefits, says Nichols. Since 2000, the portion of firms offering health insurance has shrunk from 69 percent to 60 percent.

With the number of people lacking health insurance growing every year, Democrats have rallied around the banner of universal healthcare. Former Democratic presidential candidate John Edwards deserves a nod for this; his comprehensive plan requiring everyone to have healthcare coverage set the bar for the other candidates. The plans of both Clinton and Obama share many of the key elements of Edwards's plan. The groundbreaking 2006 Massachusetts law requiring nearly all residents to have health insurance also deserves credit for helping shape the debate. "The fact that Massachusetts did universal coverage made it sort of hard for a Democratic candidate not to be for it," says Jonathan Gruber, an economics professor at the Massachusetts Institute of Technology.

Both the Clinton and the Obama plans would build on the current system of employer-sponsored healthcare. Employers would be expected to either offer health insurance or contribute to the cost of covering their employees. Both plans would expand federal SCHIP and Medicaid programs and create a new health plan that's similar to what is offered to federal employees, with subsidies to make it affordable. Insurers would be required to cover everyone, regardless of health.

The plans have their own individual flourishes. Clinton would guarantee that premiums don't exceed a percentage of family income, while Obama would reimburse employers for major medical costs if they agree to plow the savings into reducing employee premiums. But the major difference between the two plans involves requiring people to have health insurance, the "individual mandate," as it's called.

Government costs. Clinton's plan, with an estimated $110 billion annual price tag for the government, would require everyone to have coverage. Obama would make coverage mandatory only for children. His plan would cost roughly $50 billion to $65 billion a year. "If it's accessible and affordable, they'll buy it, independent of whether they have to buy it or not," says David Cutler, an economics professor at Harvard who's advising the Obama campaign. Not true, argues the Clinton camp. Without a mandate, some people, especially young, healthy ones, are going to skip signing up, and their participation is key to balancing out the higher healthcare costs of those who are sick. Who's right? It's not clear, though economists have generally sided with Clinton on this issue.

So far, voters have heard primarily about the two Democrats' plans, since healthcare isn't traditionally a central issue for Republicans. According to the Kaiser Family Foundation's March health-tracking poll, healthcare ranks second among the issues Democratic voters want the candidates to address, right behind the economy. For independent voters, it's the third-ranked issue, and among Republicans, it's in fourth place.

Now that McCain is the presumptive nominee, people are beginning to pay closer attention to his healthcare plan. Its centerpiece is a proposal to eliminate the tax break that employees currently get on their employer-sponsored health insurance benefits. Instead, McCain would give annual tax credits of $2,500 to individuals and $5,000 to families to put toward buying insurance through their employer, on the individual market, or from other organizations. He favors insurance competition, tort reform, and changes in the way that providers are paid as ways to contain costs.

What he doesn't favor is requiring insurers to cover all comers or mandating everyone to have insurance. Many specifics, including the estimated cost of the McCain plan, remain unclear. "There are lots of details to be filled out," says Tom Miller, a resident fellow at the American Enterprise Institute who is an outside adviser to McCain on healthcare. McCain is expected to offer more information about his healthcare proposal at the end of April. But his plan has already come under fire because it would encourage coverage in the individual, non-job-based insurance market, where people buy their own policies from brokers or insurers. Regulation in this market is much lighter, and insurers can cherry-pick the best prospects. "His approach requires an individual product that everyone can get," says Robert Laszewski, a Washington health policy analyst. "But these [plans] are most expensive for the old, and if you're sick, you're not going to get coverage at all."

Elizabeth Edwards, breast cancer patient and the wife of John Edwards, has criticized McCain's plan because it wouldn't guarantee coverage for people like her or McCain himself, who has been treated for melanoma. McCain adviser Miller says there are a number of options under consideration, including giving bigger subsidies to the sick or making some sort of "high-risk pool" insurance coverage available to people who can't get coverage elsewhere. McCain's free-market approach is probably less appealing to voters of all stripes than are the Democrats' proposals, say experts. But the Democratic plans to cover everyone are vulnerable as well. Republicans will charge that big-spending Democrats are proposing to sink up to $100 billion a year into a healthcare program while paying scant attention to cost containment. "McCain will say it's like loading more people onto a sinking ship," says Laszewski. Democrats also risk charges that their insurance mandates are too tough on business, especially during shaky economic times, says Robert Blendon, professor of health policy and political analysis at the Harvard School of Public Health. "People get very sympathetic toward companies during a downturn."

Of course, if the economy continues to slide, voters may generally be unenthused about major reform, say experts. The challenge then is to make it clear that healthcare is an economic issue. "For this to fly, it has to be part of a broader economic package that addresses everyday economic concerns that people have," says Drew Altman, president and CEO of the Kaiser Family Foundation. "The rhetoric will have to shift, and so will the packaging." Stay tuned.