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Health Care Reform:

Health Insurance & Affordable Care Act

Democratic Opposition Strong to President's Proposal to Tax Some Employer Coverage

Bush: Tax & State Help for Uninsured

Dems: Undermining Workplace Coverage

Most Democrats immediately attacked the plan, saying it would undermine employer-based health insurance.

Rep. Fortney “Pete” Stark (D-Calif.), who leads the House Ways and Means health subcommittee, said his panel would not even hold hearings on the plan.

“It would eliminate employer-provided coverage, through which 160 million Americans are covered today, and force people into an individual insurance market that regularly denies coverage because of family history, existing illnesses, or genetic makeup,” Stark said.

“I am not going to tax Joe Six-Pack for health care,” said Rep. David Wu (D-Ore.), a member of a subcommittee on employee benefits.

Republicans were less critical of the plan, though some expressed unease with encouraging workers to give up their employer-sponsored coverage.

Sen. Gordon Smith (R-Ore.) praised Bush for giving Congress “a green light” to engage in a broad health care debate. But Smith, a member of the Finance Committee, said he could not yet judge “what it means to cap one kind of insurance, and help the other, and who exactly is over-insuring themselves.”

Experimenting in the States

The president also proposed sending federal money to states that form plans to provide lower-cost basic insurance plans to all citizens. States would be free to come up with their own plans --as Massachusetts, California, and others are doing -- as long as they met certain standards.

The grants would be designed “to help the states that are coming up with innovative ways to cover the uninsured,” Bush said.

A bipartisan group of lawmakers introduced legislation last week seeking to fund state insurance initiatives.

“I believe the momentum of this is only going to grow,” Health and Human Services Secretary Michael O. Leavitt told reporters in a briefing Monday.

Instead of new spending, the White House plan would take federal money now used for charity care at hospitals and redirect it to the state initiatives. “There are many places in the federal budget where we support institutions and not individuals,” Leavitt said.

That drew fire from groups representing hospitals that get billions each year to provide charity care.

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