Newspapers examine effect of economic downturn on prospects for candidates' health proposals

Oct 28 2008

The current economic downturn and the recent enactment of a $700 billion bailout for Wall Street firms could have implications for the next president's health care proposal, as well as other plans, the Chicago Tribune reports.

According to the Tribune, "resources will be sharply constrained" when the next president takes office, and efforts to address the "economy's overall health will be the overwhelming task of the new president and Congress, drowning out most other priorities."

The health care proposal announced by Democratic presidential nominee Sen. Barack Obama (Ill.) is unlikely to pass in Congress next year, and the plan announced by Republican presidential nominee Sen. John McCain (Ariz.) is "even less likely to pass because it relies on eliminating a popular tax break for employer-provided health care, which would be anathema to a Democratic Congress and stir strong opposition from business and labor groups," the Tribune reports (Dorning, Chicago Tribune, 10/25). "Congress is likely to look at more limited and incremental moves to expand coverage," such as an expansion of SCHIP, according to the Wall Street Journal (Wilde Mathews, Wall Street Journal, 10/27).

James Pfiffner, a public policy professor at George Mason University, said, "Both of them have promised many policy initiatives," adding, "But it's highly unlikely either one of them could get a lot of important legislation through Congress in the first year, particularly when Congress is so polarized" (Chicago Tribune, 10/25).

George Edwards, a scholar of the presidency and a political scientist at Texas A&M University, said that McCain "has very poor prospects," as his "approach to health care probably would not be the one the Democrats would pick up on" (Thomma, McClatchy/Miami Herald, 10/26).

Employers Raise Concerns About Obama Proposal

Some employers have raised concerns about a provision in the Obama health care proposal that would require them to offer health insurance to employees or pay a percentage of their payrolls into a federal fund to provide coverage, with an exemption for small businesses, the New York Times reports. According to the New York Times, although Obama has not specified the amount of the percentage, "economists believe he might require large and medium companies to contribute as much as 6% of their payrolls." In addition, Obama has not specified a definition for small businesses.

David Cutler, a Harvard University economist and adviser to Obama, said, "We made a decision even before the plan was rolled out not to decide" on either issue, adding, "It's not that there's a decision out there that we're not telling. It's literally that we've decided not to decide."

The decision "may be smart politics," but "it makes business groups nervous that Mr. Obama might impose an unmanageable burden" and that, "any time his health plan faces a shortfall, businesses will be asked to up their ante," according to the New York Times.

Meanwhile, employers also "have concerns that Mr. McCain's plan to change the tax treatment of health benefits would erode employer-sponsored insurance," the New York Times reports (Sack, New York Times, 10/27).

Additional Developments

Summaries of several other recent developments related to health care issues in the presidential election appear below.

• Catholic Healthcare West: The Chronicle on Sunday published an interview with Catholic Healthcare West CEO Lloyd Dean, who said that health care will become a priority for Congress after the economic downturn ends (San Francisco Chronicle, 10/26).
• Health care as election issue: The economy has surpassed both health care and the wars in Iraq and Afghanistan as the most important issue to voters in the presidential election, the Newark Star-Ledger reports (Mueller, Newark Star-Ledger, 10/26).
• McCain proposal: The AP/Seattle Times on Friday examined the McCain health care proposal, which would result in a "dramatic shift in how millions of people get health insurance coverage" (Freking, AP/Seattle Times, 10/24).
• Prospect of Democratic Congress, president: Democrats have begun to outline an agenda for next year that includes "overhauling the health care system" and an expansion of SCHIP, as they have become "increasingly confident" that Obama will win the presidential election and that they will increase their majorities in the House and Senate, the Washington Post reports (Murray, Washington Post, 10/26). According to the New York Times, although Democrats have controlled Congress for the past two years, they have a "pent-up agenda on health care" and other issues on which they "clashed" with President Bush (Hulse/Herszenhorn, New York Times, 10/26).