By Pete Stark
USA Today
January 29, 2007
President Bush is to be commended for finally recognizing the needs of 47 million Americans denied health care for lack of insurance. His proposal would do little to help them. In a few years it would raise taxes for 160 million workers who receive group health insurance benefits.
The president’s plan would limit the tax deduction to $7,500 for an individual’s health insurance premium. The high rate of medical inflation would soon cause an income tax increase for most Americans.
Employers would cancel group plans. Workers could buy individual policies, which have higher costs and more limited access than group plans do. The suggestion that employers would pass on the group insurance savings in higher wages does not pass the smirk test.
Granted, the Bush plan would make the tax code more equitable. But so would eliminating the mortgage interest deduction. Who is to say home equity adds more to life quality than adequate health care?
There are many offsetting inequities in the Bush plan:
* Tax deductions are regressive and provide much greater benefit to the wealthy than to the poor. In Bush’s plan, a high-income person who is currently uninsured would receive nearly $6,000, while a low-income individual would receive $1,200.
* The individual insurance market discriminates against those who are sick or at risk of becoming so. Currently, employers cover both healthy and sick, spreading risk to reduce costs. Individuals, however, would be at the mercy of insurance companies that use family history, genetic indicators, age, occupation and illness as reasons to jack up rates — or exclude coverage altogether. Millions of Americans would therefore see their premiums increase substantially.
Much like Iraqi weapons of mass destruction, “gold-plated” health insurance is a figment of the president’s imagination. The problem with our health system is not that Americans can afford to use too much health care; it’s that too many can’t afford any.
Bush’s proposal would destroy the very system through which the vast majority of people get their coverage today and fail to replace it with an alternative means of obtaining quality care. It doesn’t deserve Congress’ consideration.
Rep. Pete Stark, D-Calif., is chairman of the health subcommittee of the House Ways and Means Committee.
