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Saturday, October 04, 2008

Obama continues to strike at a huge weakness in McCain's platform: his campaign's plan to tax employer-based health benefits for the first time in American history and thereby destroy the employer-based group-insurance system altogether, pushing American workers into the even more dysfunctional individual market.

This was the focus of Obama's big health care speech today.

So when you read the fine print, it’s clear that John McCain is pulling an old Washington bait and switch. It’s a shell game. He gives you a tax credit with one hand – but raises your taxes with the other. And recently, after some forceful questioning on TV, he finally admitted that for some Americans – those with the very best plans – his tax increase will be higher than his tax credit, and they’ll come out behind.

John McCain calls these plans “Cadillac plans.” In some cases, it may be that a corporate CEO is getting too good a deal. But what if you’re a line worker making a good American car like Cadillac who’s given up wage increases in exchange for better health care? Well, Senator McCain believes you should pay higher taxes too. The bottom line: the better your health care plan – the harder you’ve fought for good benefits – the higher the taxes you’ll pay under John McCain’s plan.

And here’s something else Senator McCain won’t tell you. When he taxes people’s benefits, many younger, healthier workers will decide that it’s a better deal to opt out of the insurance they get at work – and instead, go out into the individual market, where they can buy a cheaper plan. Many employers will be left with an older, sicker pool of workers who they can’t afford to cover. As a result, many employers will drop their health care plans altogether. And study after study has shown, that under the McCain plan, at least 20 million Americans will lose the insurance they rely on from their workplace.

It’s the same approach George W. Bush floated a few years ago. It was dead on arrival in Congress. But if Senator McCain were to succeed where George Bush failed, it very well could be the beginning of the end of our employer-based health care system. In fact, some experts have said that that’s exactly the point of John McCain’s plan – to drive you out of the insurance you have through your employer – and out into the marketplace, where your family will be given that $5,000 tax credit and told to buy insurance on your own.

A $5,000 tax credit. That sounds pretty good. But what Senator McCain doesn’t tell you is that the average cost of a family health care plan these days is more than twice that much – $12,680. So where would that leave you?

Senator McCain also doesn’t tell you that insurance in the individual market isn’t just more expensive than insurance you get through work – it also includes fewer benefits. For example, many of these plans don’t cover prescription drugs or pre-natal care. Many don’t cover giving birth, so you’d have to pay out of pocket for that – roughly $6,000. So when you’re out there fending for yourself against the insurance companies, you pay more and get less.

Here’s another thing Senator McCain doesn’t tell you – his plan won’t do a thing to stop insurance companies from discriminating against you if you have a pre-existing condition like hypertension, asthma, diabetes or cancer…the kind of conditions that 65 million working age Americans suffer from – people from all backgrounds and walks of life all across this country. Employers don’t charge you higher premiums for these conditions, but insurers do – much higher. So the sicker you’ve been, the more you’ll have to pay, and the harder it’ll be to get the care you need.

Finally, what John McCain doesn’t tell you is that his plan calls for massive deregulation of the insurance industry that would leave families without the basic protections you rely on. You may have heard about how, in the current issue of a magazine, Senator McCain wrote that we need to open up health care to – and I quote – “more vigorous nationwide competition as we have done over the last decade in banking.” That’s right, he wants to deregulate the insurance industry just like he fought to deregulate the banking industry. And we’ve all seen how well that worked out.
It's a devastating line of attack on an incredibly poor proposal, one that by itself I think would be enough to give Obama the election—if indeed he weren't already winning it. There's more coverage from Matt Yglesias, Steve Benen, and Chuck Todd; I expect this'll be the most lively exchange at this Tuesday's debate...