Analyzing the Kerry and Bush Health Proposals

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As part of their campaigns for the presidency, Senator John Kerry and President George W. Bush have proposed policies intended to reduce the cost of health care and increase the number of people with health insurance. This is the second of two reports from the American Enterprise Institute on the health plans of the presidential candidates. The first report addressed how the two plans would affect the uninsured and the incentives driving the rising cost of health care in the U.S. This study presents an independent cost estimate and impact analysis of the major policies offered by the candidates to expand access to health insurance.

The health plans offered by Senator John Kerry and President George W. Bush adopt different strategies to help the uninsured gain health coverage. Senator Kerry would expand government health programs and subsidize employers to provide insurance to their employees, with lesser subsidies directly to individuals. He would make a major commitment of taxpayer funds to underwrite his program. President Bush would extend new tax credits to individuals, and he would promote the purchase of high-deductible insurance. His proposals represent a smaller expansion of federal spending.

Joseph Antos is a resident scholar at AEI, Roland (Guy) King is an independent consulting actuary, Donald Muse is president of Muse & Associates, Tom Wildsmith is a consulting actuary for the Hay Group, and Judy Xanthopoulos is an economic consultant.

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