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Democrats Offer Health Plan of Their Own

January 24, 2007
Washington politics when it comes to health care policy.

On Tuesday, January 23, President Bush officially proposed a standard health care tax deduction that he argued would help the uninsured buy individual plans and would lower taxes for those who are covered by their employer.

The next day, two Democratic congressmen—Reps. Dennis Kucinich of Ohio and John Conyers of Michigan—reintroduced a bill that would provide guaranteed coverage for all Americans through a government-sponsored health care system.

Although not all Democrats favor the single-payer approach, health care policy tension is starting to align along a familiar fault line. Bush is advocating market prescriptions; Democrats are resisting and are promoting greater government involvement in covering the uninsured—a problem, they argue, the market hasn’t solved.

Under the Bush plan, families with health insurance would get a tax deduction of $15,000 and covered individuals would receive a $7,500 deduction. At the same time, employer-provided health insurance would be subject to taxation.

Bush asserts that 80 percent of people with employer-sponsored coverage would see their taxes drop. Companies with more generous plans would have to reduce coverage, and perhaps provide higher wages in the compensation mix, to avoid taxation.

In his State of the Union address, Bush made it clear where he is seeking health care answers.

Government should cover the elderly, disabled and children, but “for all other Americans, private health insurance is the best way to meet their needs,” he said.

Kucinich and Conyers sharply disagree. Their bill, titled the United States National Health Insurance Act, would establish a “publicly financed, privately delivered health care system” that builds on Medicare.

Everyone living in or visiting the United States would receive a national health insurance card and identification number entitling them to all necessary medical services. No co-pays or deductibles would be permitted.

The plan would be funded by a payroll tax of 4.75 percent on employers and employees, which Kucinich argues is less than employers pay for health insurance premiums. In addition, a 5 percent health care tax would be levied on the top 5 percent of income earners and a 10 percent tax on the top 1 percent of earners. Other sources of funding include a repeal of Bush tax cuts enacted in 2001 and a tax on stock and bond transactions.

Like many Democrats, Kucinich blasted Bush’s plan for not helping reduce the number of uninsured and for failing to address rising health care costs.

“It’s tax reform; it’s not health care reform,” Kucinich said during an event at the National Press Club.

A supporter of the Kucinich-Conyers proposal excoriated the president’s approach.

“The Bush plan is outrageously unfair,” said Oliver Fein, associate dean of Weill Medical College at Cornell University. “It favors the rich over the middle class.”

That argument is likely to hold sway in a Congress now controlled by Democrats. Rep. Pete Stark, D-California and chairman of the House Ways and Means Health Subcommittee, stated on Monday before Bush’s speech that he will not consider the president’s plan.

“The president’s so-called health care proposal won’t help the uninsured, most of whom have limited incomes and are already in low tax brackets,” Stark said in a statement. “But it will hurt middle-income Americans, whose employers will shift even more cost and risk to their employees.”

Stark introduced a bill last year that would combine an expansion of Medicare with employer coverage to provide coverage for more Americans. Sen. Edward Kennedy, D-Massachusetts and chairman of the Senate Health, Education, Labor and Pensions Committee, also intends to offer a plan that is based on expanding Medicare.

How much support Kucinich and Conyers will find for the single-payer idea is uncertain. Kucinich predicts his bill will garner 100 co-sponsors in the House. But achieving a majority in that body is only half the battle. Any health care bill also needs 60 votes in the Senate to avoid a filibuster.

One senator cautions against expectations that Congress will make major health care changes in the next two years.

“Dealing with this problem between now and the next election is not realistic,” Sen. George Voinovich, R-Ohio, said at a press conference last week where he helped introduce a bipartisan bill to support state-level health care reform.

But Kucinich is confident that voter sentiment favors overhaul.

“This is the defining domestic issue,” he said. “The American people are ready. They’re going to drive the politics on this.”

Mark Schoeff Jr.