Health Care a ‘Critical Issue,’ Bush Says in State of the Union Address

During his State of the Union address on Tuesday, President Bush called upon members of Congress to improve access to health care and contain health costs by passing legislation that would permit the formation of association health plans, give tax credits to help people purchase health insurance, cap awards in medical malpractice lawsuits to help decrease insurance premiums and encourage people to purchase health savings accounts, the New York Times reports. "On the critical issue of health care, our goal is to ensure that Americans can choose and afford private health care coverage that best fits their individual needs," Bush said (Bush speech text, New York Times, 1/21). He added, "A government-run health care system is the wrong prescription. By keeping costs under control, expanding access and helping more Americans afford coverage, we will preserve the system of private medicine that makes America's health care the best in the world" (Neikirk, Chicago Tribune, 1/21). During the speech, Bush proposed:

Allowing the creation of association health plans, in which small businesses can pool together across state lines to purchase health plans;
Providing low-income workers with tax credits of up to $1,000 for individuals and $3,000 for families to purchase health insurance;
Placing limits on medical malpractice awards in an effort to "moderate rising insurance costs," according to the Dallas Morning News (Dodge, Dallas Morning News, 1/20);
Permitting a tax deduction equal to 100% of the cost of health plan premiums for people who purchase catastrophic health insurance as part of the health savings accounts program created under the new Medicare law (HR 1); and
Computerizing health records to "avoid dangerous medical mistakes, reduce costs and improve care" (New York Times, 1/21).

Proposals Revive Earlier Initiatives

Bush's proposals are "old favorites rewrapped for the campaign season," according to the Wall Street Journal (Hitt, Wall Street Journal, 1/21). His initiatives regarding association health plans, tax credits and caps on malpractice awards "are measures [that] the Senate and, in a few instances, the House have already rejected," the Washington Post reports (Goldstein/Weisman, Washington Post, 1/21). Last year, Bush proposed spending up to $89 billion to give tax credits to help people without employer-sponsored health coverage purchase a health plan, but Congress took no action. The House, but not the Senate, approved legislation backed by Bush that would cap awards in medical malpractice lawsuits. Although Bush has repeatedly called for such a cap, lawmakers do not anticipate any movement on the issue without a change in the Senate's makeup (California Healthline, 1/20). Bush said that rising health costs are the "chief reason so many Americans lack health insurance" and "blamed [those increases] on too many malpractice suits against doctors," according to the New York Post (Blomquist, New York Post, 1/21). The only new proposal was advocating tax incentives to encourage people to purchase high-deductible health plans, which the administration advocates as a way to "slow the growth of health care costs," according to the Journal. However, critics of the proposal say that few people would benefit "if Congress is even able to pass it in the current, politically charged atmosphere," the Journal reports (Wall Street Journal, 1/21).

Medicare Prescription Drug Bill Touted

Bush also highlighted the Medicare legislation that he signed last year, saying it provides a "basic commitment to our seniors" to give them "the modern medicine they deserve." He explained components of the law, including a drug discount card that, beginning this year, is expected to save seniors an estimated 10% to 25% off the retail price of prescription drugs; coverage for preventive care screenings to be implemented next year; and prescription drug coverage beginning in 2006. Bush noted that passage of the bill required a "bipartisan effort," saying that the same cooperation is necessary to meet goals to expand access to health care and to address rising health costs. He added, "I signed this measure proudly, and any attempt to limit the choices of our seniors or to take away their prescription drug coverage under Medicare will meet my veto" (New York Times, 1/21).

Democratic Response

In the Democratic response to Bush's address, Senate Minority Leader Tom Daschle (D-S.D.) said that while Bush "acknowledged" the problems of "rapidly rising" health care costs and the number of uninsured residents, "the solutions he proposed -- more tax cuts -- are not the right ones." He added that Bush's proposed tax cuts will have little impact on health care accessibility or affordability and will "weaken health coverage for those who now have it." Instead, Daschle said the federal government "should use the power of 40 million Americans to lower prescription drug prices and to allow us to get more affordable drugs from Canada instead of forbidding both" actions as called for in the Medicare law. He added that such restrictions benefit drug companies and insurers, "not the American people" (AP/Dallas Morning News, 1/20). In a separate response, House Minority Leader Nancy Pelosi (D-Calif.) added that Bush has "pursued a go-it-alone foreign policy that leaves us isolated abroad and that steals the resources we need for education and health care" (Hillman, Dallas Morning News, 1/21).

Reaction

Stephen Zuckerman, a health care economist with the Urban Institute, said, "Bush is thinking about expanding coverage by putting money in people's hands." Drew Altman, president and CEO of the Kaiser Family Foundation, added, "There is no question that the cost of health care has remained a major issue on the minds of voters" (Dodge, Dallas Morning News, 1/20). John Holahan, director of the Health Policy Center at the Urban Institute, said with a federal budget deficit of about $500 billion this year, the Bush administration does not "have enough money to spend" to implement the health care proposals. Gail Shearer, a health policy expert at Consumers Union, added that the proposed tax credits would not be sufficient to help poor families purchase health insurance (Chicago Tribune, 1/21).

Survey

In a USA Today/CNN/Gallup survey of 381 people who watched Bush's address, the percentage of people who said they believed his health care policies would "move the country in the right direction" increased from 48% before the speech to 63% of respondents after the speech, USA Today reports. Among participants, 46% said they were Republicans, 28% said they were independent voters and 26% said they were Democrats (Benedetto, USA Today, 1/21).

Additional Coverage, Resources

NPR's "Morning Edition" on Wednesday reported on Bush's health care proposals. The segment includes comments from Marilyn Moon, health program director of American Institutes for Research, and Dr. Gail Wilensky, senior fellow at Project HOPE and a former CMS administrator (Silberner, "Morning Edition," NPR, 1/21). The complete segment is available online in RealPlayer. Expanded NPR coverage, including complete audio of the State of the Union address, the Democratic response and NPR news segments, is available online.
The text of Bush's speech is available online. Video excerpts of Bush's and Daschle's comments on health care are available online in RealPlayer. In addition, the complete video of Bush's address and the Democratic response are available online through C-SPAN.

This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.