ABC News Medical Editor
Oct. 28, 2008 -- Forty seven million Americans -- most from working families -- have no health insurance, and 25 million more are considered "underinsured," meaning they have health insurance but not enough to protect them from high medical bills.
Now, with the fear of an economic recession, tens of millions of additional workers are worried about losing their health benefits if they lose or change jobs. The plans proposed by Sens. John McCain and Barack Obama to address the situation reflect two very different ideas about health care reform.
The candidates have classic Republican and Democratic views about what roles the federal government and the private sector should take to solve the nation's health care crisis. Fundamentally, the Obama plan wants to increase employer-based insurance with government help, while the McCain plan wants to enter people into the private insurance market.
Is McCain's Plan More Radical?
Drew Altman, president and CEO of the nonpartisan Kaiser Family Foundation, notes that the McCain plan is, in fact, the more radical solution.
"The Democrats want to spend more to cover more people, but the Republicans are actually proposing the bigger change -- moving away from, moving people out of, the existing employment-based system," Altman said.
Currently, 160 million Americans get their health insurance from an employer, and according to surveys from the Commonwealth Fund, a private foundation specializing in health policy research, most people want to keep it that way, for a variety of reasons.
"There are better premiums, there are better benefits … you've got a human resources manager to help you out if you've got a claim denied," said Commonwealth Fund President Karen Davis.
But with U.S. health care costs spiraling out of control -- estimates say we'll top $3 trillion in three years, and reach $4 trillion by 2016 -- health economist Gail Wilensky, former Medicare head and now a McCain campaign adviser, believes workers should be encouraged to purchase their own private health insurance.
She says Americans will become cost-conscious if they have to pay their own way. And she cautions that the cost of the Obama plan to the federal government could be very high -- "between $60 to $120 billion more than the very expensive health care we already have," she said.
Health Care Reform Difficult Territory
There is one thing health policy experts we've spoken with over the course of this campaign agree on: Health care reform will not be a winner-take-all game for the next president.
"There's not going to be a plan that satisfies the right or that satisfies the left. There can only be a plan that represents some kind of a combination approach," Altman said.
Wilensky believes Congress must devise a national health care plan with elements that benefit both the public and private sectors.
"It will fundamentally depend on the Congress, and on the willingness of a president, to reach out and try to craft a bipartisan solution," Wilensky said.
Davis also emphasizes the bipartisan role the president will have to play to steer government and business to work together on health care solutions that are cost-effective for both the family and federal budgets.
"We spend an enormous amount of money on administrative costs, because we have no leadership, no collaboration between the government sector and the private sector," Davis said.
On Nov. 4, one of these two men will be elected the next president of the United States. In January, he'll go before the nation and the new Congress with his plan for America. Here are the major policy points of each candidate:
Health Care Under an Obama Administration
Expand Employer-Based Health Insurance Coverage: Under an Obama administration, employers will have to offer coverage to their employees or pay a tax to help cover the uninsured. Some small businesses will be exempt from this requirement. Low-income workers will be eligible for subsidies to purchase employer insurance.
Create a New Public Health Insurance Plan: The plan will be open to the uninsured, and employees who can't get health insurance through an employer. The plan is described as similar to Medicare.
Create a National Health Insurance Exchange: For those who want private insurance, the exchange will act as a watchdog and set up rules and standards for participating insurance plans to ensure affordability and accessibility. Approved plans will have benefits similar to what federal employees and members of Congress get.
Mandate Insurance Coverage for All Children: Children under 18 must be covered through parents' employer-sponsored insurance plans, through Medicaid or SCHIP, through the Public Plan or Exchange plan.
Control Costs With Insurance Industry Regulation and Electronic Medical Records: Plans to reduce a typical family's premium by $2,500 through savings gotten by Health IT investment and regulating the insurance industry by creating rules and standards.
Health Care Under a McCain Administration
Tax Employer Health Benefits As Income: The McCain plan would end longstanding tax exemption on health benefits paid for by employers to eliminate a bias against those who buy private insurance. People can buy insurance through any organization or association they choose.
Give Families a $5,000 Tax Credit Toward Private Health Insurance: Anyone who buys health insurance will receive refundable tax credits of $2,500 per individual and $5,000 per family. Individuals who buy a policy for less than the tax credit can deposit the remainder in a health savings account. The tax credit could also be used to offset the additional taxes if health insurance is obtained from an employer.
Allow the Sale of Health Insurance Across State Lines: Will deregulate the insurance industry to allow policies to be sold across state lines. The McCain plan would allow for the sale of cheaper policies and allow for portable, multiyear coverage.
Create High-Risk Pools to Cover Pre-Existing Conditions: Will work with state governors to create nonprofit guaranteed access plans to cover people who are denied coverage.
Control Costs With Insurance Industry Competition and Electronic Medical Records: Promote competition in the private market place to drive down costs of policies. Electronic medical records would cut down on waste and help give the public more information on outcomes, quality and cost.
Critics See Problems With Both
While both McCain and Obama have promised lower costs and greater access to health care, critics of the McCain plan say a $5,000 tax credit doesn't go far enough to buy a good family policy. The average cost of a good family policy is around $12,000. And they believe his plan does not provide adequate government oversight.
Critics of the Obama plans say it relies too much on big government, and that it will put a greater tax burden on some American companies.
But the deepest differences between the candidates health care plans may have been revealed when they were asked in the second debate whether health care in America is a right, or a responsibility.
McCain answered it this way: "I think it's a responsibility. We should have available and affordable health care to every American citizen. … But government mandates I'm always a little nervous about."
Barack Obama sees it another way: "Well, I think it should be a right for every American. In a country as wealthy as ours, for us to have people who are going bankrupt because they can't pay their medical bills … there's something fundamentally wrong about that."