tag:blogger.com,1999:blog-9069354713843321730.post33273853691376193..comments2023-10-01T09:22:37.695-07:00Comments on Economists for Obama: Correcting Some Misperceptions About McCain's Health PlanDon Pedrohttp://www.blogger.com/profile/15438565798505041042noreply@blogger.comBlogger5125tag:blogger.com,1999:blog-9069354713843321730.post-54439194916252126222008-09-19T14:17:00.000-07:002008-09-19T14:17:00.000-07:00thx all for the comments. don pedro, sorry i didn'...thx all for the comments. don pedro, sorry i didn't provide those links -- was short on time, but i recommend people read the posts there.<BR/><BR/>jennifer: really glad you think this will be useful in class! wait til you see my principles textbook....:-)<BR/><BR/>jJonah B. Gelbachhttps://www.blogger.com/profile/16937666641251545988noreply@blogger.comtag:blogger.com,1999:blog-9069354713843321730.post-75639463950275179482008-09-18T19:11:00.000-07:002008-09-18T19:11:00.000-07:00By the way, you should make sure Brad and Mark get...By the way, you should make sure Brad and Mark get this.Don Pedrohttps://www.blogger.com/profile/15438565798505041042noreply@blogger.comtag:blogger.com,1999:blog-9069354713843321730.post-60337772347388354652008-09-18T19:10:00.000-07:002008-09-18T19:10:00.000-07:00Jonah,Great post, which clears up a few things for...Jonah,<BR/>Great post, which clears up a few things for me. A few things:<BR/><BR/>1) One point you don't mention that Goolsbee and Furman have harped on is that the switch from tax-exempt health benefits would cause some people to jump brackets. I describe this issue in this post:<BR/>http://econ4obama.blogspot.com/2008/08/obama-tax-plan-and-hidden-mccain-tax.html<BR/><BR/>I calculated that the bracket jump would mean an extra tax increase of up to $900 for some people, although I realize now I forgot to take into account the fact that the employee-paid portion of EPHI is pre-tax. So in fact, the tax increase would be up to $1200 (correct me if I have this wrong.) <BR/><BR/>According to G&F there's a CBO study about this, but I haven't found it.<BR/><BR/>2) I think the key point in terms of the costs in the scenarios you lay out is the tremendous uncertainy. This was emphasized by Lerxst and by Henry Aaron in the post he links to here:<BR/>http://econ4obama.blogspot.com/2008/09/obama-vs-mccain-on-taxes-feldstein-and.html<BR/><BR/>3) I think you're too generous in evaluating whether the McCain plan will kill EPHI. It's true there's tremendous uncertainty in whether employers will drop EPHI and how soon, but the point of the whole proposal is to kill off EPHI, and that is the hope and the expectation of the proposal's designers. Give the adverse selection incentives, it seems very likely that in the long-term at least (don't ask me how long that is) the large majority of employers will drop EPHI. One complication: it's anyone's guess what would happen with public employees. Would McCain kill EPHI for federal employess, for example?<BR/><BR/>4) Ultimately, the big problem with the McCain proposal is that it would leave many on their own in the private market and unable to buy insurance. Dealing with these people was an afterthought in the proposal--I don't think there was even any mention at all in their original version--and now the budget proposed to subsidize insurance for these people is ludicrously inadequate. I'll write a post about this issue in the next couple days.Don Pedrohttps://www.blogger.com/profile/15438565798505041042noreply@blogger.comtag:blogger.com,1999:blog-9069354713843321730.post-4724335455385747912008-09-18T19:00:00.000-07:002008-09-18T19:00:00.000-07:00jonah,I thought about blogging on this too. I did...jonah,<BR/><BR/>I thought about blogging on this too. I did a total double take when I read Brad's post --couldn't believe he made that mistake.<BR/><BR/>Great post.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-9069354713843321730.post-32464775496041490732008-09-18T18:37:00.000-07:002008-09-18T18:37:00.000-07:00Thank you for an excellent, excellent post! I will...Thank you for an excellent, excellent post! I will be talking about both candidate's health care plans in my micro principles class and you just made my job so much easier!Jennifer Imazekihttps://www.blogger.com/profile/15217003898479507362noreply@blogger.com