Medical Device Daily Executive Editor

If President Bush thinks he had a time selling changes in Social Security — with few takers, even from his own party — he may have to start going door-to-door to sell his proposed expansion of healthcare insurance to Americans. But he might have some difficulties at the doors of Capitol Hill Democrats — and many others as well.

His plan to tinker with the tax structure, to stem the growing tide of the country’s uninsured for healthcare, has received mostly harsh negatives.

And most of those who avoided criticizing the plan tended to offer the proverbial “faint praise,” applauding the President for moving the health insurance further up on the domestic agenda, but few providing any ringing endorsements of its specifics.

As presented in President Bush’s State of the Union Speech Tuesday night, the plan offers two main efforts.

The first is to offer tax deductions that designate the money saved to go to health insurance, along with tax breaks for many of those who have insurance, but not through their employers, in order, he said, “to level the playing field for those who do not get health insurance through their job” — an acknowledgment that those with employee-sponsored systems don’t pay the full freight.

Secondly, he proposed federal grants to the states to extend their health insurance plans.

Further, he continued to talk up the benefits of private Health Savings Accounts, an idea he has bannered in the past but one he hasn’t given much push to lately.

Following are a variety of reactions, measured on what we’ll call the Medical Device Daily health insurance coverage thermometer.

Absolute zero:

Roger Hickey, co-director of Campaign for America’s Future (Washington), told MDD that the President’s plan is a “fig leaf” and a “Band-Aid” — “I can’t believe it would get any kind of serious consideration from Congress.” And he characterized the entire group of proposals as primarily a reaction to growing concerns about the insurance “crisis” in America rather than a proactive solution.

He noted that his organization had aggressively opposed Bush’s proposals to privatize Social Security and that it supports a health insurance coverage plan “parallel to Medicare.”

Marilyn Clement, national coordinator of Healthcare-NOW (New York), blasted the President’s plan as a “conspiracy,” saying that the proposed $15,000 income tax deduction for middle-class families “would jeopardize both Medicare and Social Security while not providing enough money to purchase real health insurance, projected to cost $16,500 for a family of four by the year 2009. And employers would be encouraged to bail out of the healthcare system even faster than they are today.”

She further characterized the plan as “more big bucks for the insurance companies,” charging that it is private insurers “who have driven the cost of the healthcare system up 73% since 2000.”


Ron Pollack, executive director of Families USA (Washington), said that the proposals offer “such small relief for uninsured, moderate-income working families that health coverage will remain unaffordable. It’s like throwing a 10-foot rope to someone in a 40-foot hole.”

David Zanottie, president of the American Policy Roundtable (Columbus, Ohio), said that characterization of the plan as a tax break is “spin.” “It’s not a tax break — it’s a new tax.”

He said the plan is designed “to capture company-paid healthcare benefits in the federal tax base. Such benefits are currently not taxable; therefore the President cannot give people a tax break on something they don’t pay taxes on in the first place . . . . The President is creating a new tax and opening the door to even higher healthcare taxes and government interference in the healthcare choices of millions of hard-working families.


And Leo Gerard, president of the United Steelworkers (Pittsburgh), called the proposals a “raw deal,” because “a so-called standard tax deduction for health insurance doesn’t set any benchmarks for covering the uninsured while sticking it to workers who have employer healthcare coverage. Congress should reject this plan out of hand [as] a back-door attempt to saddle union workers with a tax for the healthcare benefits they negotiate through collective bargaining.”


Chris Burch, executive director of the National Association of Public Hospitals and Health Systems (Washington) criticized the plan as potentially reducing the amount of money dedicated to programs for the uninsured.” And he suggested that that it involves robbing Peter to pay Paul, and that a safety net would be taken away from the uninsured without providing adequate replacement.

In general, several other hospital representatives echoed such concerns, with rather self-serving rationale: the loss of the payments they received for caring for uninsured patients.

Rather chilly:

Bill Novelli, CEO of AARP (Washington), made no comment on the proposal’s specifics but praised Bush for presenting his “ideas” for extending health insurance coverage to all.


• AdvaMed (Washington) issued a statement, with Stephen Ubl, president/CEO, giving the President “a big thumbs-up” but not commenting on any of the specifics on insurance.

However, he said the organization likes the push for greater use of health information technology since “Many of our members manufacture health information technology hardware and software.”

The response from the American Medical Association (Washington) was also of the tepid variety, saying the AMA is “greatly encouraged” that the President had raised the “awareness” of the gap in insurance coverage, but then primarily referencing its own plan of providing vouchers for healthcare purchasing based on an income “sliding scale.”

As to the other points, it commented that state insurance scenarios offer a “learning laboratory” on the issue, and — not unexpectedly — it liked the President’s additional call for liability reform. It concluded, not with loud applause of the President’s plan but by saying that the association “stands ready to assist the administration and Congress with efforts to cover the uninsured . . .”

A bit warmer:

Coming as no great surprise, Rick Kellerman, MD, president of the American Academy of Family Physicians (Washington), praised Bush’s statement that “the best healthcare decisions are not made by government, but by patients and their doctors,” and his call for “liability reforms.”

As to the proposal for financial incentives to help purchase private insurance plans, Kellerman said that such a plan “may make it more affordable for some individuals” – the small word “may” being a rather large qualifier to its comment.

Fairly warm:

Arthur Carlos, president/CEO of Destiny Health (Chicago), a provider of “consumer-directed” health plans, called the administration’s plan “a giant step towards addressing the nation’s healthcare cost crisis,” focusing on the tax deductions for buying private health insurance and saying that Health Savings Accounts and private healthcare “is the best way to meet [Americans’] needs.

But even this organization offered a caveat: that concerning how to make private insurance more affordable and increasing the numbers of those receiving coverage, “lingering questions remain.”