Cost Estimates For Health Care Proposals Of Presidential Candidates Almost Meaningless

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Democratic presidential nominee Sen. Barack Obama (Ill.) and Republican presidential nominee Sen. John McCain (Ariz.) both have announced cost estimates for their health care proposals during their campaigns, but the "figures they cite are invariably the roughest of estimates, often derived by health economists with ideological leanings or financial conflicts," and have become "almost meaningless" over time, the New York Times reports.

"Even the economists behind the forecasts say it makes them uncomfortable to hear candidates assert their numbers as indisputable fact," as the "transformational nature of both candidates' health care plans means that they can only guess at the future behavior of consumers, employers and insurers," according to the Times. The "campaigns acknowledge that the numbers are 'all over the map,' in the words of Jay Khosla, a McCain adviser," but "that does not keep them from selectively highlighting the most favorable ones," the Times reports.

Roger Feldman, a health economist at the University of Minnesota who conducted a study of the McCain and Obama health care proposals funded by the McCain campaign, said, "Every candidate should say that these numbers were produced by my experts and they're my best estimates but they're not exact," adding, "But the campaign trail is not the time for 'on the one hand, on the other hand.' It's a system where you paint things in black and white." In addition, Feldman said that cost estimates from economists often vary because they rely on a number of assumptions.

Uwe Reinhardt, a health economist at Princeton University, said, "It's garbage in, garbage out," adding, "Every econometric study is an effort in persuasion. I have to persuade the other guy that my assumptions are responsible. Depending on what I feed into the model, I get totally different answers" (Sack, New York Times, 10/22).

McCain Promotes Health Care Proposal

McCain on Tuesday during campaign events in Pennsylvania promoted his economic and health care proposals and criticized the Obama health care plan, the Pittsburgh Post-Gazette reports. Obama "will force them into a new huge government-run health care program," McCain said, adding, "I will bring down the skyrocketing cost of health care with competition and choice (that will) lower your premiums and make it more available to more Americans."

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In response, Pennsylvania Gov. Ed Rendell (D) said that McCain plans to finance his proposal through reductions in Medicare and Medicaid benefits. He said, "It will result in higher premiums and copays and more expensive drugs" (O'Toole/Mauriello, Pittsburgh Post-Gazette, 10/21).

In related news, the Washington Post on Wednesday published an analysis of an advertisement released recently by the Obama campaign that says McCain would reduce Medicare benefits by $800 billion to finance his health care proposal (Washington Post, 10/22).

Effect of Health Care Proposals on Children

The McCain health care proposal could leave millions of U.S. children without health insurance, and the Obama plan would guarantee that all children have coverage, according to reports released on Tuesday by First Focus, United Press International reports (United Press International, 10/22).

The report on the Obama proposal said that the plan would increase access to care for children. In addition, the report said that Medicaid and SCHIP would operate more effectively under the Obama proposal. According to the report, by "extending coverage to more than eight million currently uninsured children, overall children's health can be expected to improve under the Obama plan."

The report on the McCain proposal said that the plan "places children in danger of losing coverage in the (employer-sponsored) group market, reduces their insurance protections, and will reduce public options" (Graham, "Triage," Chicago Tribune, 10/22). Under the McCain proposal, many children with pre-existing medical conditions whose families must purchase health insurance on the private market would lose coverage because of a lack of affordability, the report said. McCain also likely would reduce spending on public programs that provide health insurance for children, according to the report (United Press International, 10/22). In addition, a McCain proposal to allow the purchase of health insurance across state lines could result in a loss of coverage of autism treatment for 18 million children and loss of coverage of lead poisoning treatment for 16 million children, the report said ("Triage," Chicago Tribune, 10/22).

Reprinted with permission from kaisernetwork.org. You can view the entire Kaiser Daily Health Policy Report, search the archives, and sign up for email delivery at kaisernetwork.org/email . The Kaiser Daily Health Policy Report is published for kaisernetwork.org, a free service of The Henry J. Kaiser Family Foundation. © 2007 Advisory Board Company and Kaiser Family Foundation. All rights reserved.

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