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Candidates’ healthcare fixes: tax credits vs. more federal spending

The US spends twice as much on healthcare per capita than other nations but still trails in access to care.

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But Demko said she couldn’t keep working full time with an infant with special needs. When she quit, she didn’t realize that would result in her family’s being unable to get health insurance.

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Ohio does not require insurance companies to cover children with disabilities considered to be preexisting conditions. Both she and her husband have also had minor health issues, but she never imagined they might also be a barrier to finding an affordable healthcare plan.

The Demkos’ income is nearly three times the poverty rate. That’s too much for their daughter to qualify for Ohio’s SCHIP plan and not enough to qualify for another state-sponsored program.

She’s gotten quotes for family health plans that start at $3,000 a month, which is almost as much as they earn.

For too long, she believes, insurance companies have been allowed to put profit before people, selling lower-priced plans to the healthy and at the same time charging exorbitant rates for people who have healthcare needs or just denying them coverage.

“The insurance agencies are like this huge unruly child who’s never had any boundaries on it,” she says. “To me the Obama plan tries to put some important boundaries on them – that’s what the government’s supposed to do, right? If people aren’t being taken care of and can’t get into the health insurance system, who else is going to take care of the situation?”

Shopping for healthcare plans

Laurie Gross now runs Gross Electric, a family-owned company in Toledo, Ohio begun in 1910. The company provides its 62 employees health insurance coverage. But the biggest problem they face every year is affordability.

“We’ve had four different plans in five years because every year the increases are so astronomical we have to shop around,” she says. “We’re coming to the point where it’s going to be very, very difficult for us and our employees to pay for insurance.”

The company now pays about $1,000 a month per family for coverage, and that goes up every year. The employees pay part of the cost. Advocates of the McCain tax credit argue it would help employees offset that cost, even though their overall health benefit would be taxed.

They also contend that Obama’s plan to expand public programs would cause many companies like Gross Electric to stop providing health coverage all together, because they knew their employees could get it through a government pool.

But Ms. Gross says she is committed to providing her employees coverage. The key, she says, is creating a risk pool of employees that is large enough so the insurance coverage for everyone is affordable.

The McCain camp believes that can be accomplished by allowing individuals to buy insurance on their own, across state lines, thus creating a national risk pool that would drive prices down. But Gross doesn’t believe that would work.

“I’ve never seen an insurer that looks at you as part of a bigger pool when you have a claim,” she says.

Critics of the Obama plan argue that forcing large businesses to pay for health insurance or pay a fine could drive some companies under.

A business the size of Gross Electric would be exempt, but Gross still supports the idea of requiring all companies, regardless of size, to provide health insurance because in the end she believes that’s the only way to create a risk pool big enough to ensure that health insurance is affordable.

“If I’m willing to buy my people insurance, why should someone who doesn’t – who can sell things at a lower price because of it – have an advantage over me?” she says. “At some point everybody is going to have some health issue, and at some point everybody is going to be paying an astronomical amount unless we do something to fix the system now.”

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