They’ve got you covered. Almost.

What McCain and Obama are saying about universal health care

“Universal health care” has become the mantra for many who believe that our health care system is fundamentally broken. And when 47 million Americans, including 9 million children, don’t have health care insurance it is certainly understandable. Perhaps health care access should be like access to the fire department and police protection.
But wait, let’s look at this comparison. Who pays for the police and the firemen? In some communities across the country, even those basic services are provided by volunteers or by state employees rather than private entrepreneurs. On the one hand services are paid for out of donations or taxes. Also, liability for untoward outcomes related to their service is judged by a ‘gross negligence’ standard for volunteers, while the state employees are largely protected by sovereign immunity. By this model, every American could have access to health care, but the compensation to the providers would likely be drastically diminished and recovery for negligent care would be steeply curtailed. This kind of plan could certainly work, and it might even save money, but I doubt too many people would like it.

An alternative might be that we pay for every American to have private health care insurance through higher taxes, especially on people like us. That could work, too. But would it cover an estimated 12 million undocumented aliens who currently reside in the United States? How can we justify giving them health coverage if they haven’t paid into the system?

These are some of the questions that the next presidential administration and congress will attempt to answer as they tackle the most dramatic reform of health care delivery since the inception of Medicare in 1965. Can either presidential candidate do it? If Obama is elected he will have majorities in the Senate and House. But so did Bill Clinton in 1993, and he was unsuccessful. And in 1994 the Republicans won back both houses in Congress by significant margins. So lest the Democrats think they will have it made by the fact that they might control the White House and both houses Congress, keep in mind that while President Bush is leaving with a dismal approval rating of 28% (USA Today/Gallup 6/18), the 110th Congress has an even lower approval rating of only 19% (Gallup 6/12).

It is a cold reality that even the biggest of problems and best of solutions can be ignored if the political climate in Washington is wrong. Passing comprehensive health care system legislation will require a level of bipartisan compromise that has not been seen in many years, or it will require a veto-proof majority in both houses aligned with the White House. Assuming that one of those two scenarios exist, let’s talk about what the candidates are promising, and who else may be shepherding health care reform in 2009.

altIn the spirit of non-partisanship, let’s go alphabetically. Sen. McCain’s central theme is that patients should have more choices and control of their health care decisions. McCain believes in providing patients more opportunities to purchase health care insurance. If families are not covered by employer-based health care insurance or if they opt out of that system, they would be provided with a $5,000 tax credit which could be used to directly pay for health care insurance coverage to a private insurer. McCain also promotes making health care insurance portable and increasing the use of Health Savings Accounts (HSAs). McCain states that he will work with state Governors to develop a Guaranteed Access Plan (GAP) for providing insurance to those who have been traditionally uninsurable, those individuals without prior group coverage or with pre-existing medical conditions. McCain promises to pay for this expansion of coverage through a series of cost saving measures including lowering drug prices through safe re-importation, chronic disease management, improved IT coordination, tort reform, and Medicaid/Medicare reform. Interestingly, McCain also promotes greater access to care through walk-in clinics in retail outlets.

altSen. Obama, on the other hand, promises to establish a new public insurance program for Americans who do not qualify for either Medicaid or SCHIP or have access to employer based insurance. Obama states that he would create a “National Health Insurance Exchange” to help individuals and businesses that want to purchase private insurance directly. Obama would require that all employers contribute to either the cost of health care insurance for employees or to the cost of the public plan. Lastly, Obama would mandate that all children have health care coverage, but not all adults. Similar to McCain, Obama promises to pay for his plan by increased efficiencies in the system. But he also says that wealthy taxpayers should pay more. 

Under both Sen. McCain’s and Sen. Obama’s plans, there is potential for increasing the number of “Americans” covered by health care insurance, but neither plan addresses care for undocumented aliens. Hence, neither plan is truly a ‘universal health plan’. Moreover, the promises of increased coverage are all based upon some pretty soft assumptions of savings that would be realized on long-term items like chronic disease management, improved coordination of care, and health IT solutions.

Okay, so what exactly does ‘nearly universal health care’ mean for providers? First, it means that the emergency department will still be the only “universal health care access”, where everyone, regardless of insurance, wealth, language, or nationality can receive care. And for those covered by various insurance programs, it will be more about what levels of coverage, payment, and administrative bureaucracy goes along with that card. Patients who are covered by Medicaid or SCHIP programs may have a card, but we know that in many states, the reimbursement for providers is so low that many providers will not accept those patients. And if they do, they get an appointment scheduled for many months later, well beyond when follow-up from the ED would be appropriate. In many ways, individuals covered under these programs are caught in a Catch-22 where they have “coverage”, but it really doesn’t get them appropriate access to care.

So, how likely are we to get health care reform? 2009 may prove to be a key time due to the unfortunate diagnosis of Sen. Kennedy of Massachusetts with a brain tumor. Kennedy, who chairs of the Health, Education, Labor and Pensions (HELP) Committee, has been a champion of health care reform throughout his Senate tenure. Many political insiders believe that early in the 111th Congress, Sen. Kennedy, or a surrogate, will introduce comprehensive health care system reform legislation that would redefine the fundamental structure of health care delivery in this country. Although it seems far away as we enjoy the summer months, the season of change in health care may be closer than we think. Keep an eye on the weather.


  1. Chris Carpenter on

    Thanks for a useful synopsis of interpreting LP results, Dr. Seupaul. How many are actually using “atraumatic” LP needles in their ED? How many are ordering CSF lactate levels? Prior to this article, I was doing neither but will start doing so immediately.

  2. John Tafuri, MD, FAAEM on

    I have worked both as an owner/employee/CFO of a small group and an IC. For the motivated physician, being an IC has numerous advantages. The primary advantage is that you only pay for the benefits that you want or need. As an employee, you generally have to accept certain benefits whether you need them or not. Although a cafeteria plan may ameliorate this somewhat, an employee status is always less flexible than being an IC. An employee has to “pay” (indirectly) for benefits whether s/he uses them or not.

    The other primary advantage is the flexibility to set up the retirement plan that is best for you. As an employee, you must accept the retirement plan of the group. If this is only a 401k, you may be limited to only to $15,500 in 2008. As an IC, you can choose to contribute up to $46,000 in a SEP-IRA or anywhere in between. If you wish to incorporate, you can contribute over $200,000/year pre tax to a defined benefit plan (depending on your age) in addition to having a 401k. This permits the physician to eliminate (not defer) social security, medicare and local income taxes (in most localities) and defer both federal and state income taxes. (State income taxes can also be eliminated if the beneficiary choses to retire in a state without an income tax, e.g. FL, TX) Elimination of social security taxes may become very important if the social security earnings cap is eliminated as is being discussed by some politicians.

    I would like to add one final comment. Employers can set up 401k plans that permit contributions of up to $46,000. This may sound strange; however, it is accurate. The limit of $15,500 applies to the amount that can be deducted from income. If an employer’s plan permits it, a participant can make after tax contributions up to a total of $46,000. These assets must be segretated from the pre-tax assets by the employer. The primary advantage of this, is that after tax contributions to a 401k can be rolled over to an IRA. In 2010, an IRA can be converted to a Roth IRA irrespective of income. An after tax contribution to an IRA converts to a Roth tax free. Therefore, the after tax contribution of $30,500 ($46,000-15,500) can effectively become a Roth IRA contribution and be tax free for the participant’s life and the life of his/her heir.

  3. Richard Stennes on

    Be the best of both worlds by having your personal PC be the independent contractor and you the employee of your PC. Investment and saving decisions and optimal expense options are than yours exclusively to make. You can write yourself two paychecks. One is for 10% and is yours to keep for secure wealth creation (see the Richest Man in Babylon). The remaining 90% is for budgeting according to your priorities.
    And btw, those of you who object to the “Henry” implication that unattractive “rationing” techniques are on the horizon will not be prepared for a very rude awakening which is also on the horizon. Neither God nor Mother Nature said that is right and proper let alone necessary to forever interfere with the dying process.

Leave A Reply