NCPA - National Center for Policy Analysis


February 1, 2006

The President's free-market approach to reforming health care, which he outlined in his State of the Union address last night, has the potential to reduce costs, give people more control over their care and allow some of the uninsured a chance to buy affordable coverage, says USA Today.

The President's specific proposals include:

  • Expanding health savings accounts to allow individuals to save money for routine care. The plans are linked to high-deductible policies to cover larger expenses. People with HSAs spend their own funds. What isn't spent grows tax-free, and the plans aren't tied to any specific job. HSAs can make consumers more cost-conscious and insurance more affordable.
  • Allowing more tax deductibility for out-of-pocket medical expenses, including insurance premiums. Companies get a tax break for buying policies for workers, but individuals who buy their own policies don't.
  • Allowing small businesses to pool the purchasing of health insurance across state lines, free of state regulation. It has been stalled in the Senate since 2003, largely because of opposition from special interests ranging from insurers to state health commissioners.
  • Expanding the use of electronic medical records, and giving patients more data about how doctors and hospitals compete on price and quality.

The proposals Bush outlined Tuesday night are not a magic pill for an ailing system. They don't provide universal coverage. They aren't much help to people who pay little or no federal income taxes. Even so, as the Clintons found out, when it comes to fixing health care, sometimes less can be more, says USA Today.

Source: Editorial, "Health ideas no cure-all, but some worth a shot," USA Today, February 1, 2006.

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