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Another Shot at the Safety Net
"But HSA's slice right through this intergenerational, redistributionist arrangement: they're a great deal for young, healthy folks because they don't force subsidization. Just don't get sick."
By contrast, the White House insists that "New health insurance deductions will make coverage more affordable to millions of Americans whose employers don't provide health benefits."
And the Cato Institute argues: "Patients will curb their consumption and thus help contain medical inflation. Because consumers have built-in incentives to make wise choices, many of the restrictions that insurers have placed on patients will begin to disappear. Because patients own their health savings accounts, they will have some self-insurance coverage when they switch jobs and be better able to afford catastrophic coverage on their own."
What Bush Said
Bush touched on the issue of health care last Friday during his visit to a moving company in Virginia.
"An interesting product available is called health savings accounts. . . . It provides for a high deductible catastrophic plan, coupled with tax-free contributions in the plan, basically gives the consumer control over his or her medical decisions. The plan can grow tax-free, which is an encouragement for people to make wise decisions about how they treat their body. If you have a catastrophic event, the insurance kicks in and covers it. It's portable. If you change jobs, you can take it with you. It's an interesting idea."
Later, in response to a question, Bush cast it more as a wealth-accumulation program than as part of the social safety net.
"Health savings account is an interesting opportunity for the young 22-year-old healthy person, who is able to put money aside, tax-free, and watch that money grow, tax-free, and take the money out of the health savings account, tax-free, coupled with a high deductible catastrophic health plan. In other words, this is a product that will say to those who choose, here's an opportunity for you. You start putting aside a thousand dollars a year -- in other words, you buy a high deductible policy with a thousand-dollar deductible, and you put the thousand dollars cash -- you do, or your employer does, or however you negotiate it -- that thousand dollar grows. And it can grow to be pretty substantial, particularly as you're a healthy person, over a period of time, tax-free. And all of a sudden, you've got quite a nest egg."
A Look at Promises Past
This won't be the first time Bush devotes part of his State of the Union message to the issue of health care.
In 2001 he promised: "Many working Americans do not have health care coverage, so we will help them buy their own insurance with refundable tax credits."
In 2002 : "Americans know economic security can vanish in an instant without health security. I ask Congress to join me this year to enact a patients' bill of rights to give uninsured workers credits to help buy health coverage, to approve an historic increase in spending for veterans' health, and to give seniors a sound and modern Medicare system that includes coverage for prescription drugs."
In 2003 : "We must work toward a system in which all Americans have a good insurance policy, choose their own doctors, and seniors and low-income Americans receive the help they need."
In 2004 : "Members of Congress, we must work together to help control [rising] costs and extend the benefits of modern medicine throughout our country.