MELISSA BLOCK, host:
The topic of health care is returning to the forefront of the presidential race due to the crisis on Wall Street. Today, Barack Obama's campaign launched a new TV ad. It takes aim at an article by John McCain that's been just published. In it, the senator details his plan to cut health insurance regulation. The Obama ad links that to McCain's support of bank deregulation. We asked NPR's Julie Rovner to do a little truth squadding on this ad.
JULIE ROVNER: Senator McCain's health plan would make a dramatic change in the way health insurance plans are regulated. Currently, states are in charge. So if you purchase coverage yourself, the company must be licensed and approved by your state's insurance department. Here's how McCain described the changes he'd make at an event in Pennsylvania earlier this spring.
Senator JOHN MCCAIN (Republican, Arizona; Republican Presidential Nominee): I want to give every family in America a $5,000 refundable tax credit that they can take and go across state lines, not just be confined here to the state of Pennsylvania. But if there's a better health insurance plan in Arizona, let them take it.
ROVNER: That's been a key element of McCain's plan all along. But what the Obama campaign discovered over the weekend was an article in the magazine of the American Academy of Actuaries in which McCain likens his support for health insurance deregulation to his support for bank deregulation. And out popped this ad which took it one step further.
(Soundbite of Democratic campaign ad)
Unidentified Announcer: McCain just published an article praising Wall Street deregulation, said he'd reduce oversight of the health insurance industry, too, just as we have done over the last decade in banking. Increasing costs and threatening coverage, a prescription for disaster.
ROVNER: Douglas Holtz-Eakin, McCain's top economic adviser, says that's simply the wrong comparison. We caught up with Holtz-Eakin on his cell phone in a New York taxi cab. He says the article wasn't comparing McCain's health care plan to Wall Street deregulation at all.
Mr. DOUGLAS HOLTZ-EAKIN (Economic Adviser, McCain Campaign): A particular analogy is the one to consumer banking where individuals are now able to take their money out of their account at an ATM in all 50 states.
ROVNER: A bit of deregulation few people would argue against. McCain says his health plan would make the market more competitive and drive prices down. But critics of the plan say it could also drive prices up for some people. Kim Holland is Oklahoma's Democratic insurance commissioner. She says she's worried that if younger, healthier people in her state decide to buy cheaper insurance with fewer benefits from a neighboring state, then rates will rise for sicker and older people.
Ms. KIM HOLLAND (Democratic Insurance Commissioner, Oklahoma): And although it may be beneficial in the short term for that small group that finds another market appealing, what ends up at home is a disruption, and costs can go up. And that's what we're concerned about.
ROVNER: Iowa Insurance Commissioner Susan Voss, who served in her state's department under both Republican and Democratic governors, has a different concern about McCain's plan, what she'll tell constituents if they have problems with plans from companies she has no authority over.
Ms. SUSAN VOSS (Insurance Commissioner, Iowa): I tell you what will happen is somebody will buy something in New York if it's a great deal, and then it will go south, and they won't pay for something. And where do they go for relief? If they're buying a plan that's regulated in New York, I can't help them. If the doctor here refuses to take the reimbursement rates from a plan that's in California, I can't help them.
ROVNER: McCain adviser Holtz-Eakin says state officials shouldn't worry.
Mr. HOLTZ-EAKIN: The individual would be able to complain in the state in which he resides. There would be simultaneously a coordination with the state in which the policy was issued.
ROVNER: Holtz-Eakin, however, didn't say if the federal government would provide state insurance departments any more money for what would likely be a substantially increased workload. Julie Rovner, NPR News, Washington.
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