Bush health insurance plan is unhealthy for all Americans

Written by: catherine wolf on Mar 2, 2007 5:01 PM

Linked to groups: Fair Share For Health Care Initiative

I have Lou Gehrig’s disease. I have concluded Bush’s health insurance plan is unhealthy for me and the American people. I am a quadriplegic and ventilator dependent. Although I have Medicare, it is not sufficient for my extensive needs. I urge Congress to reject Bush’s plan. I will address the part of the plan that gives individual and family health insurance tax deductions of $7,500 and $15,000, respectively.

Employer related health insurance has dropped from 63.6% in 2000 to 59.5% in 2005, according to the Economic Policy Institute (EPI). This trend will be exacerbated if employers choose to eliminate health insurance plans because their employees will have a tax deduction to buy health insurance on their own. I am insured as a dependent under my husband's employer's health plan. If his and other employers terminate their health insurance, where will I and others with serious illnesses get health insurance in the free market? Under the Bush plan, insurance in excess of $15,000 for a family would be taxable income. The administration estimates that 80% would see their taxes drop and 20% would see their taxes increase. But that assumes the status quo. Those employers that don't terminate their health insurance plans would almost certainly shift more of the cost to their employees. Thus, many middle and low income employees who have employer insurance would be taxed on the excess. Employer related insurance, which covers the majority of Americans, is far from perfect. The president's plan would have dangerous and unpredictable effects on employer related health insurance.

More importantly, the president's plan would do little to reduce the ranks of the uninsured. The government estimates that three to five million of the nearly 47 million uninsured would be insured under the Bush plan. Consider the case of a single mother with three children. She would need a taxable income of $78,550 and a pre-tax income of $91,750 to take full advantage of the Bush health insurance deduction using the 2006 tax tables. This puts her in the highest quintile of family income for 2004, according to the EPI. Minimum wage earners with families, working forty hours a week at the proposed new minimum wage of $7.25/hour, would get no tax benefit. My guess is that the primary beneficiaries of the proposed health insurance plan would be highly paid healthy young people with flexible benefits who currently opt out of employer health plans and choose a cash payment in lieu of insurance. Under the president's plan, this group would have a tax incentive to take employer health insurance or buy a private policy. Is this the group who we want to help?

Bush's plan does little to help the uninsured and jeopardizes employer related health insurance.

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