Comparing Obama and Mccain Plans

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Table of Contents

Introduction
Whether Health-Care is a spending problem
Employer-base Insurance
Medicare/Medicaid
Single Payer/Simplification
Conclusion
References

Introduction

The health care problem has assumed great dimensions due to rising costs, rise in the number of uninsured people and lack of uniformity in providing care to the needy. Columnist, Eminent thinker and Nobel-Laureate in Economics Paul Krugman has come out with a brilliant analysis on the nature of the problem and what could be done about it. There is the backdrop of two Presidential Candidates, Barack Obama of Democratic Party and John McCain of Republican Party also explicitly stating what they would do to alleviate the problem. Despite the efforts of previous Democratic President Clinton to resolve major issues during his tenure powerful political pressures did not allow much relief given to people. In this brief essay we will follow Kurgman’s view and arrive at an assessment of the plans of the two presidential candidates as well. We shall broadly follow the theme by placing Paul Krugman’s analysis.

Whether Health-Care is a spending problem

Paul Krugman analyzes the problem from five criteria. The first one is whether Health-Care has become a spending problem. He points out that from 5.2 percent of GDP in 1960, spending on this has increased to 16 percent during 2004. Even government reports point out increase in the spending but surprisingly one reason given is the technological advancement in this instance has increased the costs rather than reducing it. Krugman’s analysis indicates that while spending is inevitable the wastage that has been inherently taking place constitutes a considerable element. At present the waste amounts to nearly 30 percent. Inefficiency and Wastage are serious elements in public spending on this but whether either candidate would be in a position to resist the efforts of powerful lobbies is a moot question. Both are keen on promising as much as possible to alleviate the sufferings of the people by offer of concessions.

Employer-base Insurance

Krugman points out that in 2003 only 16 percent of the medical expenses was borne by the individuals while public or private insurance had to bear the rest. The analysis also indicates that 20% of the population accounted for 80% and a small fraction alone accounted for substantial expenditure. The insurance cover alone helps people to enjoy medical benefits and if they have to shell out from their pockets for all the medical expenditure, most people would find that most of the income would go only for this expenditure. The problem for the insurance companies is different in that literally it has to raise the premium for everyone so that the small percentage is given all that it requires. This is an unfortunate position for many but this stems from the fact that for long insurance on medical expenditure is linked with the employer’s responsibility. A few decades back when social welfare included medical benefits included for the workmen this did not seem to be a burden. But the rising costs in the field itself has produced an imbalance. McCain offers deregulation of insurance market as one way out of impasse. Obama suggests a broader base and a pool and federal funding of certain elements. He is keen on suggesting measures which would enable the insurers to reduce premium.

Medicare/Medicaid

Kurgman points out that despite the American medical system being the most privatized one, the major funding comes from the public. Medicare covers the needs of seniors while Medicaid is concerned with providing insurance cover to the weaker sections of the society. Medicare does not pose much problem with reference to spending and even if it does, the votes of the seniors constituting a good threat would have imbalances in it rectified by the political class. But Medicaid is poor people’s hope and “programs for the poor are poor programs” (Richard Titmus, British welfare scholar). In a very clear analysis Krugman points out that it is not so much that Medicare or Medicaid inherently add to the costs, rather the increased costs in medicine and allied peripherals have added to the problem. Both the presidential candidates have come out with elaborate plans to counter the undesirable consequences that could flow from any restriction on the spending. The general opinion is that McCain’s scheme would repel many needy Americans from insuring at all. In contrast Obama’s promise of almost universal coverage sounds fascinating but budgetary controls indicate that they would merely be pipe dreams as amounts would not be available. And this is prior to the present bail out big banks and financial institutions!

Single Payer/Simplification

In spite of the fact that the American spending on health care is of substantial percentage than other advanced nations the result has been poor returns due to inefficiency, accepted by many knowledgeable ones. It is indicated by Krugman that the quality and quantity in the medical services are by no means extra-ordinary but unfortunately the manner in which many cost factors interfere with proper functioning leads to inefficiency at many levels, i.e., it fails to provide the needed relief to uninsured ones and is much more interested in recovering money from the general pool of patients rather than having a social ethos. This could be attributed to larger reliance on private rather than public sector for services to be rendered.; The system has many variations and loopholes. The political will to curb profit motive of big medical industries is lacking. There is this curious dilemma as well. Where needs of health for members are taken care of public bodies like Veterans’ Administration there is effective cost control and satisfaction. But as a nation we are committed to free enterprise and as much de-regulation as possible. So from economic to political philosophy one has to turn for solace or blame! Simplification has been sacrificed, a plethora of rules and acts and activities slow down the process of rational approach.

Conclusion

Obama offers many comprehensive schemes and many of them are realistic and could help all sections of people: more so the underprivileged. If he had his way almost every American would be insured against unforeseen medical contingencies. However, whether his administration would be able to withstand the powerful private groups lobbying for insurance, pharmaceuticals and allied industries is a difficult question to answer. McCain’s may be broadly defined as a restatement in the faith of individual enterprises and a pep talk to the under privileged. He pleads for more de-control and de-regulating mechanisms. In fact the differences may be said to represent a basic ideological difference in approach to market and governments by the respective candidates. We have to wait for the results and see how effectively each one would put into effect what has been promised by them.

References

The New England Journal of Medicine, Vol.359: 781-784, 2008. Web.

www.barackobama.com

www.johnmccain.com

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