Syndicate and Hague

I’m going to make this simple. I’ve read a lot of analysis and details and wrote about this before and I am going to distill what I have gleaned from sources as varied as the NY Times, the Economist, the Kaiser Foundation and (gag) the Heritage Foundation about what John McCain proposes to do to your employer-based health care.

• The amount your employer pays into your health care plan will be taxed. This means you will pay a higher income tax (as your income will be higher) and your employer will have to pay additional taxes on your income (as your income will be higher).
• The $5,000 “tax credit” that McCain says offsets this tax will not go to people who continue to have employer-based coverage. The “tax credit” will go only towards privately-purchased (crappy) coverage you buy on the market. From what I have read, it only goes to the insurance company, not to you.
• On average, employers put in over $10,000 a year towards their employees’ family health care plans. So if you’re making $50,000 now, you will be taxed on $60,000.

There you are. Those are your talking points.

If you’re interested in why McCain wants to do this and how it reflects his world views, you can read my other post on Obama vs McCain on health care. I can also sum up below.

McCain wants to privatize health care just like he wants to privatize social security. This is a way to do it. Many younger workers will drop out of the employer-based insurance pools because they either don’t need/don’t think they need the level of coverage that it affords. Instead, they will buy low fee, huge deductible private insurance. As the low risk population leaves the insurance pool, employer-based insurance pools will be increasingly high risk (older/sicker) and premiums will go up. The hope is that premiums will go up to the point where employers drop insurance altogether and everyone is forced onto the free market.

It’s a losing scenario in the long run. It’s a losing scenario in the short run, too.