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Bush spars with Democrats over health agenda

Posted on: Wednesday, 15 February 2006, 17:49 CST

By Caren Bohan

DUBLIN, Ohio (Reuters) - President George W. Bush promoted tax-free savings accounts on Wednesday as a way to make medical care more affordable, but Democrats accused him of offering recycled ideas that would worsen the health system.

With congressional elections looming in November and polls showing rising health costs are a key concern for Americans, Bush visited the Ohio headquarters of fast-food chain Wendy's to tout a health agenda he said would make the system more consumer-driven.

Bush, in his annual State of the Union speech, urged the expansion of health savings accounts, or HSAs, which allow people to set aside money tax-free for routine medical costs.

The accounts are designed to be paired with insurance plans that cover catastrophic illnesses. The catastrophic plans have lower premiums than traditional plans offered by many large U.S. employers that often cover a large portion of routine costs while also covering major illnesses.

Bush said traditional health plans gave consumers little incentive to compare prices when picking providers.

"Most Americans have no idea what their actual cost of treatment is," Bush said. "There's no reason at all to worry about price. Somebody else is paying the bill. ... There's no pressure for an industry to lower prices."

Bush pointed to Wendy's as an example of a company that offered HSA plans to employees.

But Senate Democratic leader Harry Reid of Nevada said, "The president's most recent recycled health care idea will make the health care crisis worse."

Reid pointed to a study that suggested the number of uninsured, now numbering 46 million, would increase under the plan because employers would respond to the new tax breaks by dropping traditional coverage. Democrats have also said HSAs would mainly benefit the wealthy.

In an initiative the White House estimates will cost $59 billion over five years, Bush would expand the tax breaks offered to those with HSAs and raise limits on contributions.

His health agenda also includes reining in malpractice lawsuits and letting small businesses band together to buy health insurance at preferred rates offered to larger companies.

Democrats also lashed out at Bush over snafus in the roll-out of the new Medicare prescription drug benefit.

The plan relies on private insurers, pharmacies and other health-care companies to provide drug benefits to the elderly and disabled. Many Medicare recipients have had difficulty navigating the paperwork.

"The same Republicans who gave us a prescription drug benefit that is confounding seniors and failing to meet their needs are now trying to serve Americans an equally misguided remedy for the country's health care crisis in the form of Health Savings Accounts," said House Democratic Whip Steny Hoyer of Maryland.

(Additional reporting by Tabassum Zakaria)

Source: REUTERS

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