John Kerry claims that his health care proposal is not government-run. He says he will allow all Americans to buy into the same health care plan that Members of Congress have and provide relief for employers that provide workers with health care. But is that what his health plan really does?

At the heart of the Kerry health care plan are three proposals: First, Kerry has proposed the creation of a taxpayer-funded "Congressional Health Plan" that purports to give Americans the same health care coverage that members of Congress currently get. Second, Kerry's plan includes a reinsurance proposal that would have the federal government and, by extension, the taxpayers, cover the most expensive health care expenditures of other Americans. Third, and the one he doesn't like to highlight, Kerry's plan expands the Medicaid program to the middle class. Unfortunately, what John Kerry hasn't told you is how his plan will increase the tax burden on working Americans while placing millions of Americans into a government-run health care plan.

Rather than trying to use government resources to encourage people to buy into and thereby stabilize existing markets for health insurance, the Kerry plan will simply add another layer of bureaucracy that is ripe for additional government control over health care. Rather than supporting proposals like Association Health Plans and Health Savings Accounts, which help individuals and small businesses afford health insurance, Kerry has proposed a $1.5 trillion health care plan that will do little to control health care costs while raising taxes.

The Truth Behind Kerry's Government-Run Health Care Plan

Kerry's "Congressional Health Plan" Is Not The Same Plan Members Of Congress Get. The Kerry plan would set up a separate "Congressional Health Plan" to cover the uninsured. While Kerry's rhetoric is that he would allow all Americans to buy into the Federal Employees Health Benefits Plan (FEHBP), his website actually shows that he is talking about setting up a "separate pool" to cover enrollees. (www.johnkerry.com, "John Kerry's Plan To Make Health Care Affordable To Every American", accessed 10/13/04)

The "Congressional Health Plan" Would Have Higher Costs. Even if the Kerry plan mandates that the people in the federally run "Congressional Health Plan" would get similar benefits to participants of FEHBP, most Americans won't be able to afford coverage, even with the subsidies promised by the Kerry-Edwards plan. The 2005 average premium of the most popular family plan under FEHBP -- the Blue Cross Blue Shield standard plan -- is $10,800 and the federal government pays 72% of those costs. If Sen. Kerry truly wants to provide "all Americans with what Members of Congress have" that would cost the federal government $558 billion in 2005 alone. (www.opm.gov, "FEHBP Premium Rates for 2005").

Kerry's Plan Expands Government Control Of Health Care. The "Congressional Health Plan" will be an opportunity for the federal government to further expand the degree of regulation it has over the provision of health care in the United States. Government will have the ability to create rules about what health plans must cover and regulate decisions that doctors and patients normally make. Rather than giving control to doctors and patients, the Kerry "Congressional Health Plan" empowers government bureaucrats and regulators.

The Kerry Plan Will Trade Private Health Coverage For Government Health Care. The Kerry plan creates incentives for employers to simply dump their employees into the "Congressional Health Plan" or into the Medicaid program. This would allow employers to hold their costs constant while passing off any health care price increases to the government and taxpayers. The expansion of public programs displaces people who already have insurance thus spending hundreds of billions of dollars to "insure the insured." According to the National Center on Policy Analysis, eight million people who are currently insured will lose private coverage because of Kerry's expansion of Medicaid. (www.ncpa.org, "John Kerry's Plan", 9/04)

Eighty-Six Percent Of People Covered In The Kerry Plan Will Be In The Medicaid Program. 21.6 million of the 25.2 million people insured under the Kerry health plan will be in the Medicaid program, which is a government-run health care program that provides limited access to doctors, limited numbers of prescriptions or limited access to specific drugs. (www.lewin.com, " Bush and Kerry Health Care Proposals: Cost and Coverage Compared", 9/21/04)

The Kerry Government-Run Reinsurance Plan Shifts The Burden Of Significant Health Care Costs To Taxpayers. Although Kerry presents this part of his plan as the primary way to control health care costs, there is no cost controlling mechanism at all. The Kerry plan simply shifts significant health care costs to taxpayers, while empowering government to make critical health care decisions. By taking away incentives that currently exist to help control the costs of employer-sponsored health insurance, the Kerry reinsurance plan only exacerbates the problem of increasing health care costs. The price tag for Kerry's government reinsurance proposal reflects $8 billion for newly insured Americans and a $565 billion price tag, or 99% of the cost of the proposal, for people who are already covered with health insurance. (www.aei.org, "Analyzing the Kerry and Bush Health Proposals: Estimates of Cost and Impact, 9/13/04).

Kerry's Government-Run Reinsurance Proposal Makes the Federal Government the Final Decision Maker On Health Care. The Kerry reinsurance proposal gives bureaucrats and politicians, rather than patients and doctors, the power to make critical health care decisions. Under the Kerry reinsurance proposal, government bureaucrats, not doctors, will be the ones making critical decisions such as: which services and procedures will count toward the threshold, which life saving treatments should be covered, and how much doctors, hospitals and other health care providers should be reimbursed per procedure. Increased government control under the Kerry reinsurance proposal could have grave consequences for patients including:

• Premature babies, whose medical costs runs into billions of dollars, or $58,000 (2003) per baby. (www.marchofdimes.com, "Promising New Treatment for Prematurity", 6/12/03)

• Heart patients in need of angioplasty or a stent which range from $24,079 to $37,405 and Coronary Artery Bypass Graft (CABG) which ranges from $53,671 to $84,550. (http://www.bcbsnc.com/apps/cost-estimator/report.do?type=inpatient⊂=5)

Kerry Plan Results In 225 Mandates On Business. Small business groups such as the Associated General Contractors, the National Association of Wholesaler-Distributors, the National Federation of Independent Business, the National Restaurant Association, and the National Retail Federation released a study showing that Kerry's health plan would impose at least 225 regulatory mandates on businesses that participated in the plan. (www.thecre.com, "The Business-Specific Elements of the Proposed Kerry