Friday, May 02, 2008

Diabetes And Alzheimer's Disease Linked By Salk Institute Study

Diabetes And Alzheimer's Disease Linked By Salk Institute Study
Diabetic individuals have a significantly higher risk of developing Alzheimer's disease but the molecular connection between the two remains unexplained. Now, researchers at the Salk Institute for Biological Studies identified the probable molecular basis for the diabetes - Alzheimer's interaction.


Irish-made drug still not available for MS
Irish Medical Times - Dublin,Ireland
The American Academy of Neurology last week gave its stamp of approval to the drug after new research showed Tysabri significantly increased the number of patients who were disease-free after two years of use.
See all stories on this topic

Prozac May Help Curb Disease Activity In Multiple Sclerosis
Science Daily Thu, 01 May 2008 4:21 PM PDT
The antidepressant Prozac may help to curb disease activity in the relapsing remitting form of multiple sclerosis, reveals preliminary research in the Journal of Neurology Neurosurgery and Psychiatry.
Prozac may aid in limiting disease activity in multiple sclerosis
New Kerala Thu, 01 May 2008 8:34 AM PDT
London, May 1 : A new research has revealed that the antidepressant Prozac may aid in limiting disease activity in the relapsing remitting form of multiple sclerosis (MS).
Presentation offers closer look at mysterious disease
Post-Bulletin Thu, 01 May 2008 7:29 AM PDT
Dr. Daniel Lachance seemed a little taken aback when he arrived at the Holiday Inn of Austin. The Mayo Clinic neurologist expected an audience of locals. But some in attendance had traveled great distances. Nearly everyone in the room had multiple sclerosis, an illness causing the nervous system to malfunction
Prozac Reduces Disease Activity in MS Patients
KOLD News 13 Tuscon Wed, 30 Apr 2008 8:07 PM PDT
WEDNESDAY, April 30 (HealthDay News) -- Prozac may help reduce disease activity in people with the relapsing remitting form of multiple sclerosis (MS), a new study suggests.



New Model For Embryonic Limb Development Revealed By USC Researcher
A study led by a researcher at the University of Southern California has found a new model to explain how signals between cells in the embryo control limb development.The study, which will be published in the May issue of the journal Nature and now available online, found that secreted growth factors at the distal tip of the embryonic limb act as instructive molecules that control the pattern of bones along the length of the limb in an animal model.
Seeking An Osteoporosis Fingerprint Through Genotyping
For the first time ever, an extensive genome-wide search has been undertaken to find the genes linked to osteoporosis and fracture. Five regions of interest have been identified that appear to warrant further scientific investigation.
Genentech And Biogen Idec Announce Top-Line Results >From Phase II/III Clinical Study Of Rituxan In Systemic Lupus Erythematosus
Genentech, Inc. (NYSE:DNA) and Biogen Idec, Inc. (Nasdaq:BIIB) that a Phase II/III study of Rituxan® (rituximab) for systemic lupus erythematosus (SLE, commonly called lupus) did not meet its primary endpoint defined as the proportion of Rituxan treated patients who achieved a major clinical response (MCR) or partial clinical response (PCR) measured by BILAG, a lupus activity response index, compared to placebo at 52 weeks.
Diabetes And Alzheimer's Disease Linked By Salk Institute Study
Diabetic individuals have a significantly higher risk of developing Alzheimer's disease but the molecular connection between the two remains unexplained. Now, researchers at the Salk Institute for Biological Studies identified the probable molecular basis for the diabetes - Alzheimer's interaction.

Health Insurance / Medical Insurance News

Getting married for health insurance

By Ricardo Alonso-zaldivar

Seven percent of Americans say they or someone in their household decided to tie the knot in the last year so they could receive healthcare benefits, a poll finds.
PBS' 'NewsHour' Examines Effects Of Massachusetts Health Insurance Law Two Years After Enactment
PBS' "NewsHour with Jim Lehrer" on Monday reported on how the Massachusetts health insurance law has affected the state's fiscal situation and uninsurance rates.


California Gov. Schwarzenegger To Attempt Second Health Care Proposal
In an interview with the Associated Press on Tuesday, California Gov. Arnold Schwarzenegger (R) said that he would try again to pass legislation to overhaul the state's health care system and that he would not reduce the scale of his plan to get it approved, the 01 May 2008
Presumptive GOP Presidential Nominee McCain Provides Further Detail On His Health Care Proposal
Presumptive Republican presidential nominee Sen. John McCain (Ariz.) on Tuesday in a speech at the 01 May 2008

BT Test For Breast Cancer Now Covered By Insurance
Provista Life Sciences LLC (PLS) announced it will file private insurance claims on behalf of women who take the BT Test™ and cover 100 percent of the test's cost not covered by insurance.

They've Got You Covered?

February 14, 2008

Updated: February 15, 2008

Obama and Clinton ads both claim all Americans would be covered by their health plans. Clinton's would come close.

http://www.factcheck.org/elections-2008/theyve_got_you_covered.html
Summary


In television ads, Clinton’s campaign says her health care plan is the only one that will provide universal coverage, while Obama says his plan will cover all Americans, too. We find:

  • Obama is being misleading when he says his proposal would "cover everyone." It would make coverage available to all, but experts we consulted estimate that 15 million to 26 million wouldn't take it up unless required to do so.
  • Clinton stretches things a bit, too. Even her plan – which, unlike Obama’s, includes a mandate for individuals to get insurance – would leave out a million people or perhaps more, depending on how severe the penalties would be for those who don't comply. She won't say how her mandate would be enforced, but has said that she was open to the possibility of garnishing wages.
  • Update, Feb. 15: A new Obama ad in Wisconsin misrepresents the words of former Labor Secretary Robert Reich, falsely claiming he said the Obama plan produced greater savings than the Clinton plan.
  • Experts also are skeptical of both candidates' claims that their plans will reduce the cost of insurance for the typical family by $2,000 or more. " I know zero credible evidence to support that conclusion," says M.I.T's Jonathan Gruber.
Behind the dueling ads there is a legitimate disagreement. Obama is reluctant to force people to buy health insurance they don't want even if the government makes it available at a subsidized price. And Clinton says that any proposal that doesn't aim to cover 100 percent of the uninsured would be "nibbled to death" by opponents.

Analysis

Experts say the health care plans put forth by Democratic presidential candidates Hillary Clinton and Barack Obama are very similar – and Obama himself has said his proposal has 95 percent in common with hers. But that other 5 percent is a source of contention.

Clinton Ad: "Obligation"

Clinton ad image

Narrator: She fought for universal health care long before it was popular. Got health insurance for six million kids, and expanded access to health care to the National Guard. Now she’s the only candidate for president with a plan to provide health care for every American. A top economist calls Hillary’s plan the difference between achieving universal health coverage – and falling far short.
Graphic: "…the difference between achieving universal health coverage…and falling far short." –Paul Krugman, The New York Times, 2/4/08
Narrator: If you believe health care is America’s moral obligation, join her, Tuesday. Hillary Clinton.
Clinton: I’m Hillary Clinton and I approve this message.

In recent ads and appearances, Clinton has said that her plan would provide "universal" health care coverage and Obama's would not. Obama has countered that his plan is "universal" too. The disagreement has played out in dueling television ads. A Clinton ad airing in Wisconsin and Texas says, "She's the only candidate for president with a plan to provide health care for every American." An Obama ad that has run in those same states, as well as in Ohio, features the candidate saying he has a plan to "cover everyone," with the words "universal coverage for all Americans" in a full-screen graphic.
The debate between the candidates hinges on the major difference in their proposals: Clinton's includes an individual mandate that would require everyone to obtain health insurance; Obama's plan only mandates that children have it.
Which one would cover everyone? Studies and experts say an individual mandate would lead to universal or near universal coverage and a plan without such a mandate would cover substantially less of the currently uninsured.
"I hear Obama saying he's got universal coverage, he’s just wrong," says John Sheils, senior vice president of The Lewin Group, a politically neutral health care research organization. "I don't know of anyone who studies this issue that would consider his plan to be universal coverage. You might call it universal access to coverage ... but the distinction Clinton is drawing here is correct."
Not even Clinton's mandate is certain to lead to 100 percent coverage, however. Estimates say a mandate would lead to coverage for more than 90 percent of the now-uninsured, or even close to 100 percent. But experts say some inevitably would be missed, or even evade the mandate. The most recent report on this issue, by Jonathan Gruber, a professor of economics at the Massachusetts Institute of Technology, says a plan with an individual mandate would cover 97 percent of the uninsured; a plan without one would cover 49 percent. But Gruber, who talked to the campaigns of Clinton, Obama and John Edwards about health care, stresses that the precise numbers are difficult to know for certain. "There is a legitimate debate about whether a plan with a mandate will get you to universal coverage," he says. "But what is beyond dispute is that a plan without a mandate will not get you universal coverage."

Who's Left Out?

Obama Ad: "Mother"

Obama ad image

Obama: My mother died of cancer at 53 and those last painful months, she was more worried about paying her medical bills than getting well. I hear stories like hers every day. For 20 years, Washington's talked about health care reform and reformed nothing. I've got a plan to cut costs and cover everyone.
Graphic: The Obama Plan
–Universal coverage for all Americans
–Saves typical family $2,500
For more details:
BarackObama.com/Healthcare
Obama: But unless we stop the bickering and the lobbyists, we'll be in the same place 20 years from now. I'm Barack Obama and I approve this message because to fix health care, we have to fix Washington.

Back in the fall, Clinton took to citing a statistic that Obama's plan would leave out 15 million of the uninsured, a number that Obama has questioned. In a Feb. 2 debate on CNN, Obama said: "I dispute that there are 15 million people out there who don't want [insurance]. I believe that there are people who can't afford it, and if we provide them enough subsidies, they will purchase it."
Frankly, we also found the number to be "dubious" last November when Clinton used it in a debate. Her campaign said at the time she based her claim on a column by The New Republic’s Jonathan Cohn.
However, Gruber says the 15 million figure is reasonable and perhaps even too low. He told us that he estimates roughly that Obama's plan would cover about two-thirds of the currently uninsured, which would imply that just over 15 million people would not gain coverage. Gruber's published study didn't specifically address either the Clinton or Obama plans. Rather, it examined a Clinton-like plan that included subsidies and an individual mandate – which he found would cover 45 million of the uninsured – and a plan with just the subsides but not Obama's mandate for children. Gruber found that type of proposal would cover 23 million of the uninsured. There are an estimated 47 million nonelderly Americans without health insurance.
In the study, published by the National Bureau of Economic Research, Gruber says that "if penalties are strong … the mandate is likely to be close to universal." Clinton has not stated what the enforcement mechanism would be under her plan, and she has been evasive when responding to questions on this point. However, she recently said, after much prodding, that garnishing wages was a possibility, along with automatic enrollments or some measure through the tax system.
Sheils at The Lewin Group says evaluations his organization has done, including one recently in Colorado and a national analysis for The Commonwealth Fund, have yielded similar results. He says a plan with subsidies and an individual mandate could cover 90 percent-plus of the currently uninsured, while one without the mandate could reach about 40 percent. Sheils bumps that estimate up to about 45 percent for Obama's plan when considering the candidate's mandate for covering children. (Nine million of the uninsured are kids, and a requirement that they be covered could lead to some adults picking up coverage, too.)
Both of these experts give similar reasons for why a plan without a mandate would not lead to universal coverage. Affordability is not the only barrier to health care. Even when very generous subsidies are offered, people don't always take advantage of them. Sheils and Gruber immediately point to the number of people eligible, but not signed up, for Medicaid or the State Children's Health Insurance Program, which are free in almost all cases. Sheils estimates about 25 percent to 30 percent of those eligible for such government programs don't enroll. More concrete numbers are available for children: Among the 9 million uninsured children, 74 percent are eligible for Medicaid or SCHIP, according to the Kaiser Family Foundation. Kaiser cites a lack of awareness and difficulty applying for these programs as reasons parents don't enroll their kids.
Also, about 7 percent of those who have access to employer-sponsored (and subsidized) health insurance don't take it, according to Gruber's research. (It's possible some may still find the employee contribution for premiums to be too expensive.)

Obama Ad: "Debate"

Frame shot from Obama "Debate" ad

Narrator: After 18 debates, with two more coming, Hillary says Barack Obama’s ducking debates?
It’s the same old politics of phony charges and false attacks.
On health care, even Bill Clinton’s own labor secretary says Obama covers more people than Hillary, and does more to cut costs, saving twenty-five hundred dollars for the typical family.
Obama’s housing plan? It stems foreclosures and cracks down on crooked lenders. That’s change we can believe in.
Obama: I’m Barack Obama and I approved this message.

Obama's Misleading Ad

Update, Feb. 15:  This section was added after our original item was posted.
The Obama campaign released a new ad Feb. 14 in Wisconsin called "Debate," quoting Bill Clinton’s first secretary of labor, Robert Reich, as saying Obama’s plan covers “more people” than Clinton's. We find the ad misleading and, in one respect, false.
It’s true that Reich expressed the opinion on his blog back on Dec. 3 that Obama's plan covers "more people" than Clinton's. That was in an item criticizing Clinton for “stooping ... low” to attack Obama for wanting to bolster Social Security’s finances and for not including a mandate in his health care plan:

Reich, Dec. 3, 2007: I’ve compared the two plans in detail. Both of them are big advances over what we have now. But in my view Obama’s would insure more people, not fewer, than HRC’s. That’s because Obama’s puts more money up front and contains sufficient subsidies to insure everyone who’s likely to need help – including all children and young adults up to 25 years old.
More recently, however, Reich has not been so emphatic. In a Jan. 13 item he found the plans of Obama and Clinton to be “the same” in almost every important respect. While on Dec. 3 he said he thought Obama's plan would cover more people because it "puts more money up front," by Jan. 13 he said that all Democratic plans "spend nearly an identical amount of money." On the question of whether Clinton or Obama's position on mandates is best, he said, “Who's correct? It's hard to know.” He urged the Democratic candidates to “stop squabbling over healthcare mandates.”
Reich did not, however, state in any of his blog items that the Obama plan "does more to cut costs" or that it saves $2,500 for the typical family. Those are claims made by the Obama campaign, not by Reich as the ad falsely claims. And we're skeptical of the claims that both Clinton and Obama make about the lavish savings their plans would produce, for reasons we get to later in this article.
Reich is a professor of public policy and has been in a running feud with another liberal professor, Paul Krugman, a Princeton economist who writes a column for The New York Times and who has been attacking Obama and his health care plan in that space and on his own blog. Reich’s most recent word on the subject, in fact, is headlined “Krugman Still Has it Wrong on Obama’s and Hillary Clinton’s Health Care Plans,” which simply refers readers back to his Jan. 13 posting that says it’s “hard to know” which is best.

We note here that both Reich and Krugman are best known for their liberal commentary and neither is a specialist in health care economics. Also, Reich states in his Jan. 13 article that “only around 3% of the population” would be left without health insurance in the absence of mandated coverage for adults. He doesn’t say where he got this figure. We find that hard to reconcile with the hard fact that millions of Americans are currently eligible for cheap health insurance and still don’t sign up for it. As mentioned earlier, for example, about three-quarters of the 9 million uninsured children in the U.S. are eligible for SCHIP or Medicaid, and Gruber estimates that about 7 percent of adults who could get health insurance through an employer don't take advantage of it. We therefore give more weight to the estimates of Sheils and Gruber than to Reich's.

Savings and Costs

Aside from the mandate, the candidates' plans are similar. They differ in details, but both propose to lower health care spending and individual costs through increased efficiency and reduced administrative costs, and both will offer an array of insurance options, including a public plan. Both will expand or revise Medicaid and SCHIP, and both will require insurance companies to provide guaranteed coverage to all. Here’s our comparison of key points:
Comparision of health care plans
Clinton says that her plan would save $2,200 for the average family. Obama’s campaign requested an analysis from three Harvard professors, who estimated an average savings of $2,500. Both intend to achieve these savings primarily through increased efficiency – electronic medical records and a focus on preventive care are paramount – and curbing incidental administrative expenditures like underwriting and prescription costs.
But economics experts aren’t buying it. Sheils calls these estimates "nonsense." "Your average family’s spending," he tells FactCheck, "should be around $4,500 out of pocket on their premiums and expenditures; $2,500 would be over 50 percent of that. ... It’s just outrageous that you could claim you’d knock 50 percent right off the top." Sheils points out that preventive care and electronic medical records, two sources of such savings, are already major projects: "All you could do is accelerate it, and you can’t credit the presidential candidate for all of the savings that come from something that would’ve happened anyway." He acknowledges that other proposed efficiency innovations, like improved clinical effectiveness research – determining the relative usefulness of various treatments – could have an impact on costs, but warns that new guidelines would encounter resistance from doctors and require serious policy overhauls.
Gruber is also skeptical of the claimed "savings." He praised both candidates for their intentions but believes that "at the end of the day, the only way to control health care costs in America is to deny Americans health care they want. ... I think the notion that we’re going to save $2,000 per person in America for most things, I know zero credible evidence to support that conclusion," he says. "Basically, we just don’t know. We just have no clue what it’s going to do."
To be sure, not all are so skeptical. Kenneth E. Thorpe, professor of health policy at Emory University, says that both candidates’ overall savings estimates are "reasonable." In addition to the savings for individual premiums, both campaigns estimate that their plans will save $110 billion to $200 billion per year in health care spending. "It sounds like a big number, but they're really not that big," Thorpe told us, pointing out that total health care spending in the U.S. is $2.2 trillion a year. Obama's and Clinton's estimates are about 5 percent to 10 percent of that.
As for the price tag: Clinton estimates that her plan will cost $110 billion per year, and Obama's Harvard analysts put the cost for his plan at $50 billion to $65 billion annually. Both candidates propose to defray these costs primarily by rolling back the tax cuts for those in the top income brackets. The nonpartisan Tax Policy Center estimates that such a rollback, in conjunction with other measures like revising the estate tax, could save roughly $140 billion per year  – meaning that if the cost estimates are realistic, the method of paying for them may be realistic as well. But since both plans are lacking details  – for instance, neither candidate has said how big the tax credits or subsidies would be, or how many people would qualify – it's tough to gauge just how feasible the dollar projections are.

– by Lori Robertson and Jess Henig
Correction, Feb. 18: We twice say in this article that Gruber estimates 7 percent of those with access to employer-sponsored health insurance don't take it. Originally, our second reference to this statistic said the figure was 7 million, instead of 7 percent. We have corrected the error.

Sources

Gruber, Jonathan. "Covering the Uninsured in the U.S." National Bureau of Economic Research, Jan. 2008.
Kaiser Commission on Medicaid and the Uninsured. "Enrolling Uninsured Low-Income Children in Mediaid and SCHIP." Kaiser Family Foundation, Jan. 2007.
Gruber, Jonathan and Ebonya Washington. "Subsidies to employee health insurance premiums and the health insurance market." Journal of Health Economics, 24(2), 2005 March: 253-276.
"This Week with George Stephanopoulos." Sunday Headliner; Senator Hillary Clinton. ABC News transcript, 3 Feb. 2008.
Obama, Barack. "Plan for a Healthy America," 29 May 2007.
Clinton, Hillary. "American Health Choices Plan," 17 Sept. 2007.
Blumenthal, David and David Cutler and Jeffrey Liebman. "Final Costs Memo," 29 May 2007.
Robert Reich, “Why is HRC stooping So Low?” Robert Reich’s Blog 3 Dec 2007.
Robert Reich, “Democrats Should Stop Squabbling Over Healthcare Mandates,” Robert Reich’s Blog 13 Jan 2008.
Robert Reich, “Krugman Still Has it Wrong on Obama's and Hillary Clinton's Health Care Plans” Robert Reich’s Blog 13 Jan 2008.

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Clinton and Obama make an agree-athon of the final Democratic debate.

Clinton-Obama Slugfest

Who lands a clean punch? Edwards was there, too.

http://www.factcheck.org/elections-2008/theyve_got_you_covered.html


FactCheck.org: McCain's $5,000 Promise

Watch McCain ad: "Health Care Action"
Watch McCain ad: "Health Care Action"


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FactCheck.org: McCain's $5,000 Promise
http://www.factcheck.org/mccains_5000_promise.html



May 1, 2008

His new ad only tells half the story of what his health proposal could mean for U.S. workers.

Summary

McCain says in a new TV ad: "Let's give every American family a $5,000 refundable tax credit" to buy health insurance.
Sounds good. But McCain failed to mention how existing employer-sponsored health benefits would be affected.

• Workers would be taxed on the value of any employer-paid health benefits, partially offsetting the $5,000 credit for those now covered by such plans.
• Experts say a tax credit plan like this would likely cause companies to reduce or eliminate health benefits for their employees.
The aim of the McCain plan is to reduce health care costs through increased competition, by encouraging individuals to shop around for health insurance and medical care. There are many who favor such an approach, and we take no position on it one way or the other. But McCain's simplistic ad misleads viewers by promising to give "every American family" a $5,000 benefit while failing to mention what he would also take away.

Analysis

Sen. John McCain's ad was released April 29 and will air in Iowa.

Who Benefits?

John McCain 2008 Ad:
"Health Care Action"

John McCain: The problem with health care in America is not the quality of health care, it's the availability and the affordability. And that has to do with the dramatic increase in the cost of health care.
Let's give every American family a $5,000 refundable tax credit so that they can go out across state lines and get the insurance policy that suits them best.
I can characterize my approach on health care by choice and competition, affordability and availability.
We need community health centers. We need walk-in clinics. We understand that emergency room care is the most expensive in America.
There's many, many solutions to this problem. I think we can address them. The fundamental problem is not the quality of health care; it's the cost of health care. So health care must be made affordable and available.
I'm John McCain and I approve this message.

In the ad, he says the problem with health care is not the quality, but the cost. As a remedy, he promises "every American family a $5,000 refundable tax credit" so families can purchase their own insurance policies. (Individuals would receive $2,500.) The federal government would send the money directly to insurance providers.
Those with employer-sponsored coverage, however, also might want to know that under McCain's plan, they will pay taxes on the value of health care benefits they receive from their employers. It's not that families will receive a windfall of $5,000, but that the credit will more or less offset the increased taxes they'll pay.
Who saves money and who loses under the plan, depends on the tax bracket an individual or family is in and what their health coverage costs. Kenneth E. Thorpe, a former Clinton administration health expert who now is a professor at Emory University, says there would be "a lot of redistribution – a lot of winners and losers" under a McCain plan. Lower-income individuals could do better if they have health care through their employer. They'd pay a lower tax rate on those benefits than higher income workers. "Some people will pay more and some will pay less," Thorpe says.
Those who would benefit most from McCain's tax credit are those who already buy their own private plans and don't receive tax benefits. Those who are uninsured may find the tax credit provides enough financial incentive to sign up for health care policies. The average annual premium costs for a family with employer-sponsored insurance (including both the employee's and employer's contribution) was $12,106 in 2007, and it was $4,479 for a single person, according to the Kaiser Family Foundation. Annual premiums for nongroup coverage (i.e., individually purchased plans) vary widely, currently ranging from $1,163 to $5,090 for singles, and $2,325 to $9,201 for family coverage. McCain says he will work with states to set up pools to cover those who have been denied insurance. One idea he suggests is to create nonprofit entities that would contract with insurers to cover high-risk people.
Some years in the future, the tax credit may not be substantial enough to make up for the increase in taxes. "Over time, an increasing number of workers will end up paying [more] in higher taxes ... than they will receive in federal assistance through the tax credits," Thorpe told us. "This occurs because the average premiums for employer-sponsored health insurance increase much faster than the health tax credits." (The McCain campaign says the credit will be indexed to the Consumer Price Index.)

What Happens to My Health Plan?

In a speech in Tampa this week, McCain also said that those with employer-sponsored policies could keep them and that their policies "would be largely untouched and unchanged." But experts generally agree that such a plan would have a major impact on employer-sponsored health care.
The current tax system encourages companies to offer insurance, and indeed, 61 percent of the nonelderly population in the U.S. had insurance through their jobs in 2006, according to the Kaiser Family Foundation. (Only 5 percent, 13 million people, bought their own insurance.) McCain’s plan to tax workers on the value of their employer-provided health care plans and provide tax credits would encourage some employers, mainly small businesses, to drop health benefits, say experts, and the proposal could eventually eliminate job-based insurance altogether.
Paul Fronstin, director of the health research and education program at the Employee Benefit Research Institute, a nonprofit organization that analyzes benefit programs, says a tax credit plan like McCain's likely would mean the end of employer-sponsored health care. "The question is how does it play out and over what period of time. ... It’s not something that you would see overnight."
Fronstin, whose institute is supported by businesses, unions, foundations and insurers, among other organizations, says "older, less healthy people are generally losers" as the system changes, and young and healthy people would generally be the winners. "I think what's going to happen is you're going to have insurance companies designing plans that are essentially free to people because they are below or at the tax credit," he tells FactCheck.org. "And healthy people are going to find that attractive." As those people drop their employer-sponsored coverage, "you see the beginning of the erosion of the risk pool. ... Less healthy people are left [in the employer-sponsored pool] and so the costs go up," which drives more healthy people out. Eventually, Fronstin says, employers will question why they're offering health care if most employees don't see it as a benefit. "That’s what I see as the tipping point of employer-sponsored coverage."
Another independent expert we consulted said that tax credits would "definitely" lead to a reduction in employer-sponsored coverage, but such benefits wouldn't disappear completely. John Sheils, senior vice president of The Lewin Group, which analyzes health care plans for both political parties, told us that the group plans offered by employers could still be cheaper than what's on the individual market – meaning not all the young and healthy people would scrap job-based plans. "I think you get an adjustment early on, and then I think it would level off," he says. An assessment The Lewin Group conducted of a similar tax credit plan found a net loss of employer-sponsored coverage for about 10 million persons, Sheils says. He has not analyzed McCain's specific proposal, however.
Emory's Thorpe told us in an e-mail that McCain's plan "would result in fewer individuals covered through employer-based plans over time. The extent of the reduction would be greater in small firms (that face administrative costs similar to those workers will find in the individual market) and lower for larger firms with higher administrative costs." He echoed Fronstin's comments that "the proposal also provides incentives for younger, healthier workers to migrate to the individual market resulting in higher premiums for older, more chronically ill workers that continue to receive coverage through their employer."
A tax expert also says credits would "tend to undermine" employer-offered coverage. Leonard E. Burman, director of the nonpartisan Tax Policy Center and head of the Treasury Department's tax policy office during the last two years of the Clinton administration, said in testimony before the House Budget Committee in October 2007 that tax-credit proposals then under consideration likely would lead to employees at smaller firms losing their benefits. "Many firms, particularly larger ones, would still offer insurance because of the combination of convenience, administrative cost savings, and pooling afforded by large groups of people subject to relatively little adverse selection," said Burman in his prepared remarks. "But firms currently near the margin between retaining and dropping insurance would be likely to drop."
The experts we consulted are making predictions, of course, and some, like McCain, argue that tax credits won't lead many employers to drop health care plans. Nina Owcharenko, an analyst at The Heritage Foundation, which has long supported tax credit proposals, says employers would still have incentive to offer health care in order to attract the best of the workforce, and people are accustomed to getting their health care through their jobs. "So it’s not something that's going to die down tomorrow," she says. Owcharenko also says McCain's plan would lead to people having portable coverage they could take with them from job to job. Those with "portable" coverage would, of course, no longer be covered by their employer.
Fronstin says large employers in particular are "hesitant" about such proposals. "They’re concerned about, then what happens. If you destroy the risk pool, how does the government get back into fixing what it may have destroyed? And how much is that going to cost, and how much control would we have over it?"
We make no judgments as to whether a heavily employer-sponsored system or one with more privately insured individuals is better or worse. But we do note that McCain, in his ad, neglected to tell workers how their taxes would be affected by his proposal. And his pronouncement that employer-based plans would be "largely untouched" is optimistic, at best, and at odds with what all but one health expert told us.
-by Lori Robertson, with Viveca Novak
Correction, May 1: Our story originally said that under McCain’s plan, employers would no longer be able to deduct as a business expense the cost of providing health insurance for their workers. That’s not correct. We initially misunderstood this point from the campaign.

Sources

McCain, John. Remarks as prepared for delivery in Tampa, Florida, 29 April 2008.
"Straight Talk on Health System Reform." JohnMcCain.com, accessed 30 April 2008.
The Henry J. Kaiser Family Foundation. "The Uninsured: A Primer," Oct. 2007.
The Henry J. Kaiser Family Foundation. "How Non-Group Health Coverage Varies With Income," 4 Feb. 2008.
The Henry J. Kaiser Family Foundation. "Employee Health Benefits, 2007 Summary of Findings," 2007.
Fronstin, Paul and Dallas Salisbury. "Health Insurance and Taxes: Can Changing the Tax Treatment of Health Insurance Fix Our Health Care System?" Employee Benefit Research Institute. Issue Brief No. 309, Sept. 2007.
Burman, Leonard E, Tax Policy Center. Statement before the House Committee on the Budget, "Tax Code and Health Insurance Coverage," 18 Oct. 2007.
Owcharenko, Nina. "Addressing Adverse Selection Concerns Under the President’s Health Care Proposal." The Heritage Foundation, 30 Jan. 2007.

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