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Are you familiar with the healthcare proposals of Sen. John McCain and Sen. Barak Obama? Are you ready to vote based on their positions on healthcare? If not, here is a point-by-point comparison of the two contrasting approaches to health care reform in this election year.

Universal Coverage

Both candidates regard universal coverage as a top priority and they both agree that it is unacceptable that fifteen percent of Americans have no health insurance coverage. However, they differ significantly in how to reach universal coverage.

Obama's approach is to "mandate" that all children be insured and that employers "pay or play" by either providing health insurance to employees or contributing toward the cost of a new public plan. This new plan will be subsidized by tax dollars and will look very much like the current Medicare Program. A "National Health Insurance Exchange" will also be created under the Obama Plan to promote and sell this new insurance to small businesses and currently uninsured individuals.

McCain's plan will neither mandate insurance nor force businesses to offer insurance. He will reform the insurance market allowing individuals to buy health insurance across state lines in a national insurance market to be created by deregulating the insurance industry. Currently, insurance is regulated by the 50 individual states, with each having its own regulation on who is allowed to sell insurance policies and how comprehensive health benefits ought to be. The proposed deregulation of the insurance market is designed create a national health insurance market that fosters competition and innovation.

McCain will also allow insurance companies to offer a variety of insurance options including high-deductible health plans that are much cheaper than the current comprehensive insurance plans that require relatively small deductibles and co-pays. Most important, McCain would make employer-provided health benefits taxable and provide an offset by giving a tax credit of $2,500 for individuals and $5,000 for families.

In brief, while Obama takes a top-down approach to universal coverage, McCain takes a bottom-up approach. Obama's approach will achieve universal coverage quicker than McCain's plan, but will involve more government financial support and regulation.

McCain's plan, in contrast, will rely more on the efficiency of the market to make healthcare more competitive and affordable and will be less expensive to taxpayers. But his proposed removal of the heretofore tax-free health benefits may reduce employers' willingness to offer insurance to employees and the offsetting tax credit of $2,500 for individuals and $5,000 for families are too meager to purchase health policies in the private insurance market.

Cost Control

Both candidates are concerned about the high cost of healthcare, but Obama's approach will likely cost more than McCain's approach. A selling point of Obama's approach is its insistence on a generous, comprehensive benefits package similar to that available to federal employees for all Americans. This feature, when coupled with the desire to make insurance "portable" and universally available to all, will in all likelihood add financial burden to the federal budget at a time when the economy is slowing down and government revenues are drying up. The price tag of covering more people and the need to keep costs down will make government cost control inevitable.

McCain's proposal involves no new publicly-funded insurance programs and his insurance reform will foster competition and keep healthcare costs down. McCain's plan seems more promising from the standpoint of cost control and efficiency.

How Providers Are Paid

How we pay doctors, hospitals and other healthcare providers can significantly affect both the quality and cost of healthcare. Both leading candidates are in favor of payment reforms, but they have been short on specifics so far.

One reason for the lack of details is that healthcare reimbursements are complicated and there are deep vested interests. Any proposed change will create opposition and controversies among winners and losers of a payment change. Another reason is that we still know too little about how new payment methods really work nationally to improve both the fairness to all providers and the efficiency with which the care is delivered.

Pay-for-performance is a good example. In theory, economic efficiency and clinical outcomes can both improve if third-party payers compensate hospitals and physicians more for better quality and outcomes. However, this theoretically appealing strategy works only if hospitals and physicians are totally committed to the pay-for-performance concept and that the third-party payers have developed ultra sophisticated information technology software and data warehouse capabilities that are required for this new payment scheme to work.

Making Healthcare Delivery More Efficient

Both candidates are mostly vague on this critical issue that can significantly change how we deliver care and how much Americans can expect to pay for healthcare. Healthcare delivery is not an exact science and plenty of evidence has emerged from recent research that many Americans receive too much care that offers insufficient value to justify the costs. They are oftentimes treated nevertheless because plenty of specialists exist in a community and supply tends to create its own demand.

Health information technology has been hailed as a bright spot in the otherwise gloomy field of health system change and both candidates would encourage the use of technology. Electronic medical records and other e-health measures have the potential of making healthcare delivery more efficient and less expensive. However, formidable hurdles exist in the promotion and adoption of e-health and little concrete evidence exists to support the claim that the integration of HIT by itself will lead to better care at a lower cost.

In summary, Americans have two very different healthcare choices in the upcoming presidential election. Obama's health proposal reflects the mainstream Democratic belief that healthcare is a fundamental right and no one should be denied it because of his or her inability to pay. If implemented, it will make American healthcare more like the European system based fundamentally on the concept of "solidarity' or a sense of togetherness. The Obama plan will also expand the regulatory role of the federal government in the insurance market requiring comprehensive benefits be offered by all insurance plans.

On the other hand, McCain's vision is more in line with the Republican view of small government, individual freedom and personal responsibility. The government shouldn't force businesses and individuals to comply with its heavy-handed rules and decisions unless national security is at issue. The deregulation of the health insurance market proposed by John McCain will undoubtedly make health insurance more affordable. However, his proposal to tax employer health benefits will be strongly opposed by labor unions and their political allies and will have the potential effect of eroding the traditional, employment-based health insurance coverage.

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