Bush Plans Tax Reform To Boost Heath Insurance Coverage

by Mike Godfrey, Tax-News.com, Washington

23 January 2007

In his State of the Union address today, President George W. Bush is expected to outline plans for tax reforms to help alleviate the growing burden of healthcare costs on individuals and businesses in the United States.

In his radio address at the weekend, President Bush said that healthcare costs are growing more than two times faster than wages, while rising costs are also making it more difficult for businesses to offer health coverage to their employees.

According to Bush, the best remedy for this problem is through reform of the tax code, rather than through the creation of new entitlement programs and increases in taxation.

"One of the most promising ways to make private health insurance more affordable is by reforming the Federal tax code," Bush stated.

"Today, the tax code unfairly penalizes people who do not get health insurance through their job. It unwisely encourages workers to choose overly expensive, gold-plated plans. The result is that insurance premiums rise, and many Americans cannot afford the coverage they need," he observed.

Bush argued that one way to fix the health care system was by treating health insurance more like home ownership.

"The current tax code encourages home ownership by allowing you to deduct the interest on your mortgage from your taxes. We can reform the tax code, so that it provides a similar incentive for you to buy health insurance," he stated.

"In my State of the Union Address, I will propose a tax reform designed to help make basic private health insurance more affordable -- whether you get it through your job or on your own," he revealed.

Bush also expressed support for "innovative" solutions to the problem of health care coverage at states level and pledged more help for state governors in this regard.

"Governors across the nation have put forward plans to make basic private health insurance more accessible for their citizens. When I go before Congress next week, I will announce a new effort - led by Health and Human Services Secretary Michael Leavitt - to help governors reduce the number of people in their states without private health insurance," he said.

"I look forward to working with Congress to pass the initiatives that I lay out next week, so we can help millions more Americans enjoy better care, new choices, and healthier lives," the US President concluded.

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