KerryCare Goes Best With a Large Shaker of Salt.

Campaigning politicians are notorious for making pledges they can't keep. And voters usually take what they say with a grain of salt. But Senator John Kerry's health-care plan is so full of empty promises it really ought to come with a free shaker.

Kerry has repeatedly claimed that his proposal is "not a government plan." But that's just not true. KerryCare is one of the most expensive proposals in the history of government. It would increase federal spending anywhere from $1 to $1.5 trillion dollars — roughly the GDP of Russia — over ten years.

Twelve times larger than President George W. Bush's health plan, KerryCare would instantly nationalize a large segment of the U.S. insurance industry. And it would vastly expand both Medicaid and Medicare, two of the government programs people complain about most. How does Kerry expect to pay the bills?

Well, his campaign has come up with some very creative budgeting. Kerry says increased taxes on Americans who earn over $200,000 would cover his plan. But that would only bring in about $650 billion over a decade, leaving him hundreds of billions short and making new taxes on the middle class inevitable. For KerryCare alone, the average taxpayer would have to pay $10,000 over the next decade — or $1,000 per year, according to Americans for Tax Reform.

Surely, though, with its astronomical price tag, KerryCare would bring better medical treatment and cover the uninsured. Right? Wrong. Kerry's plan would not solve the problem of the 8.2 million chronically uninsured (out of a total uninsured population of 45 million). Instead, it would mostly address people who already have insurance — shifting up to 18 million people with private coverage into government-funded Medicaid programs and HMOs. In fact, nearly 60 percent of KerryCare would be spent on people who already have insurance. Even worse, about 90 percent of KerryCare's proposed funding would go to state governments, employers, and insurance companies — not to individuals.

Kerry's debate-night promise to give everyone the same insurance package that Congress gets represents a big step towards nationalizing U.S. healthcare. His "health alliance" plan would entail a direct transfer of tax dollars from federal coffers to private business — with the government reimbursing employers for three-fourths of the cost of catastrophic claims over $50,000.

Whereas KerryCare would expand government and subsidize big business, President Bush's proposed reforms take a fundamentally different approach: They put the individual first.

To start, Bush would encourage Americans to buy their own insurance by making health-care premiums for catastrophic insurance tax-deductible. He would also level the playing field so small businesses and the self-insured get the same tax advantages as big businesses. And through Association Health Plans, he'd allow small businesses to band together to form larger purchasing pools to negotiate "big business" rates with insurers. Bush would also cut oppressive state-based red tape. Under Bush's plan, consumers would be able to shop across state lines for the best rate on emergency-insurance policies. Such competition would drive down rates for everyone, particularly in overly regulated states. Right now in New Jersey, it costs more than $4,000 a month to purchase a family policy. That's more than it costs to lease a Ferrari. Perhaps most important, Bush would promote the Health Savings Accounts (HSAs) passed into law last year. These are tax-free, interest-accruing accounts that can be used for health expenses as owners see fit. Instead of paying an HMO for services they may never use, account holders keep their money to spend on the services they really need.

HSAs must be combined with an inexpensive, high-deductible insurance plan that can be used for true emergencies, the way car insurance works. The consumer pays for minor repairs out-of-pocket — using his own money or his tax-free HSA money — but remains insured for major accidents. These accounts are already reducing the number of uninsured. Since HSAs were signed into law, tens of thousands of uninsured Americans have gained coverage. In fact, one in three HSAs is purchased by someone who was not previously insured. HSAs also make insurance portable, no longer tying it to employment. In our shifting, flexible labor market, employment-based insurance no longer makes sense. The loss of a job shouldn't mean the loss of insurance. HSAs fix that problem. Kerry would maintain employment-based coverage and even give companies subsidies — to the tune of $700 billion over 10 years — to insure their employees.

Today, the U.S. government already pays about 45 percent of all health-care costs. In other words, our system is nearly half-way socialized, which is one reason health-care costs are spiraling out of control today. Kerry would take America further down the path to socialized medicine, while Bush would guide us towards a free market.