President George W.
Bush has outlined a series of health care initiatives that largely
complement the proposals that he has already made-and in some
cases, signed into law. The President's approach is deliberately
targeted and incremental, and therefore is considerably less
expansive and less expensive than Senator John Kerry's (D-MA)
health plan.
A Variety of New
Proposals. The President's new
health care proposals are wide ranging. They include:
The creation of
refundable health care tax credits to cover millions of
uninsured Americans;
The promotion of the
recently enacted Health Savings Accounts;
An expansion of
traditional public programs- the State Children's Health Insurance
Program and Medicaid-to cover uninsured children;
An expansion of
federally funded community health centers and clinics;
Major changes to the
health insurance markets through the establishment of broader
association health plans, state-based health insurance pools,
and interstate competition among health insurance plans;
and
New tax deductions and
tax exemptions to enhance long-term care coverage.
Beyond these various
health insurance and tax code changes and public program
expansions, the President continues to propose major changes in
medical malpractice law. He also favors the promotion of
information technology to streamline medical records and reduce
errors, as well as new initiatives to combat the unresolved
problems of waste, fraud, and abuse that continue to plague the
giant Medicare and Medicaid programs.
Building on a Mixed
Record. The President
supported and signed into law the Medicare Modernization Act
of 2003, creating a universal entitlement of unknown cost for
prescription drug coverage within Medicare. It is the largest
entitlement expansion since the Great Society. It will add
significantly to the unfunded liabilities of the Medicare program
and impose higher taxes on individuals and families.
By signing the
Medicare Modernization Act of 2003, President Bush also secured the
enactment of Health Savings Accounts, a new health care
savings option. This one change in the law holds the potential
of broadening direct personal control over health care decisions,
while substantially improving and transforming America's health
insurance markets.
The President signed
into law a limited health care tax credit for certain displaced
workers under the Trade Adjustment Act of 2002. The Bush
Administration has also promoted greater flexibility for states to
expand coverage in innovative ways under Medicaid and the State
Children's Health Insurance Program and bolstered community health
centers to provide care for low-income persons.
Costs and
Consequences. There are a variety of
recent estimates of the costs and the consequences of expanded
coverage under both the Bush and the Kerry health plans. The true
cost of the new Medicare law is unknown.
Beyond the Medicare
legislation, the Lewin Group, a prominent econometrics firm
modeling health care proposals, estimates that President Bush's
health care proposals would increase total federal expenditures by
an additional $227.5 billion over 10 years, while reducing the
number of the uninsured by 17 percent, or 8.2 million. White House
officials anticipate that the President's policy initiatives
would produce a more robust expansion of health care coverage,
reducing the number of uninsured by 11 million to 17.5 million
Americans. Other analysts have different estimates based on
different assumptions.
Conclusion.
The Bush health
care policy proposals are generally designed to reinforce the
private sector's capacity to expand health coverage and
improve the delivery of medical services to Americans. A key
achievement of the Bush proposals, if properly implemented,
would be to increase personal control and private ownership of
health insurance policies.
Robert E. Moffit,
Ph.D., is Director of and Nina Owcharenko
is Senior Policy Analyst for Health Care in the Center for Health
Policy Studies at The Heritage Foundation.