A future of hope and opportunity requires that all our citizens have affordable and available health care. When it comes to health care, government has an obligation to care for the elderly, the disabled, and poor children. We will meet those responsibilities. For all other Americans, private health insurance is the best way to meet their needs. But many Americans cannot afford a health insurance policy.Tonight, I propose two new initiatives to help more Americans afford their own insurance. First, I propose a standard tax deduction for health insurance that will be like the standard tax deduction for dependents. Families with health insurance will pay no income or payroll taxes on $15,000 of their income. Single Americans with health insurance will pay no income or payroll taxes on $7,500 of their income. With this reform, more than 100 million men, women, and children who are now covered by employer-provided insurance will benefit from lower tax bills.
At the same time, this reform will level the playing field for those who do not get health insurance through their job. For Americans who now purchase health insurance on their own, my proposal would mean a substantial tax savings — $4,500 for a family of four making $60,000 a year. And for the millions of other Americans who have no health insurance at all, this deduction would help put a basic private health insurance plan within their reach. Changing the tax code is a vital and necessary step to making health care affordable for more Americans.
My second proposal is to help the states that are coming up with innovative ways to cover the uninsured. States that make basic private health insurance available to all their citizens should receive federal funds to help them provide this coverage to the poor and the sick. I have asked the Secretary of health and Human Services to work with Congress to take existing federal funds and use them to create "Affordable Choices" grants. These grants would give our Nation's governors more money and more flexibility to get private health insurance to those most in need.
There are many other ways that Congress can help. We need to expand Health Savings Accounts — help small businesses through Association Health Plans — reduce costs and medical errors with better information technology — encourage price transparency — and protect good doctors from junk lawsuits by passing medical liability reform. And in all we do, we must remember that the best health care decisions are made not by government and insurance companies, but by patients and their doctors.
The President accomplished none of his 2007 proposals in what turned out to be a very bitter and divided Congress.
However, the President's ideas to reform the tax code in order to help Americans pay for health care did find their way into a number of Republican presidential health care plans--albeit not always in exactly the same form.
The Democrats accomplished none of their 2007 health policy objectives as well. Democratic objectives included a $35 billion expansion of the State Children's Health Insurance Program (SCHIP), enabling the federal government to negotiate Medicare Part D drug prices, and cuts to Medicare HMOs in order the fix the 2008 10% Medicare physician fee cuts.
