WEDNESDAY, Feb. 1, 2006 (HealthDay News) -- President Bush drew mixed reaction Wednesday to his broadly outlined strategy for taming health-care costs and reducing the ranks of the uninsured in his State of the Union address Tuesday evening.

Whether it's the right prescription for solving the nation's health-care ills was a matter of debate by experts.

Proponents of market-based health reform welcomed the president's proposal to expand health savings accounts (HSAs) through tax incentives and new provisions that would make HSA-compatible health insurance more flexible and transferable.

"You're giving people control over their own money, so that's always a winner in my book," said Devon M. Herrick, a senior fellow with the National Center for Policy Analysis, in Dallas.

Critics, however, argued that high-deductible health plans and proposed tax breaks don't go far enough to ease health inflation or solve the nation's uninsured crisis.

"It's a pretty minor, very targeted set of policy prescriptions that don't go to the root of our fundamental problems in the health-care system," said Karen Davis, president of The Commonwealth Fund, in New York City.

HSAs, signed into law in December 2003, allow Americans to put aside tax-free dollars for their medical expenses. But to do so, people have to purchase high-deductible insurance to cover their "catastrophic" costs.

The Bush administration has embraced HSAs as a way to control rising health-care costs. The idea is that people will think twice about using medical care and will shop around for the best deal before spending their own money. The strategy fits into the president's vision of an "ownership society" that encourages Americans to take greater responsibility for their health, retirement and financial security.

Under the president's plan, individuals who purchase HSA-compatible health insurance would get the same tax breaks on premiums that people with employer-sponsored health insurance already enjoy. The president also proposed allowing Americans to take that coverage with them when they change jobs.

"I don't see a problem with the tax credit approach," said Dr. Arthur Garson Jr., dean of the University of Virginia School of Medicine. "But the tax credits need to be large enough that people actually buy insurance."

The plan would will help some uninsured workers, he predicted, but added that "the problem is, it's not enough."

What's more, Garson said, it's unclear what effect HSAs will have on the health of Americans. If people don't get preventive care, go to the doctor as needed and buy necessary medications, "the heath of the nation will suffer," he said.

The president devoted the bulk of his 52-minute speech to the war on terrorism, the economy and the quest for alternative energy sources. And while he described his health-reform agenda in very broad strokes, some observers said they expected to hear more.

"The President spent surprisingly little time talking about health care in his address, an issue of primary concern to everyone," Judith Stein, executive director of the Center for Medicare Advocacy, noted in a statement released Wednesday morning. "But the ideas he did espouse are more about saving money than getting people health care," she added.

And Bush was also criticized for how his administration has handled health issues.

"Our government has a responsibility to help provide health care for the poor and the elderly," he said in his speech, "and we are meeting that responsibility."

Critics, however, pointed to the ranks of the uninsured that have increased during his administration -- from roughly 40 million in 2000 to almost 46 million in 2004.

And while the president signed into law the largest expansion of Medicare in the program's history with the creation of a new prescription drug benefit, he made no mention of it during Tuesday night's speech. Medicare Part D took effect Jan. 1 amid a chaotic launch and persistent confusion over the benefit's complicated design.

Despite its rocky start, "I think the prescription drug benefit in the long run is probably going to be a good thing," said Dr. Ray E. Stowers, vice president and dean of the College of Osteopathic Medicine at Lincoln Memorial University in Harrogate, Tenn., and a member of the Medicare Payment Advisory Commission.

Stowers, who chairs a committee of the American Osteopathic Association, also applauded Bush for once again calling on Congress to pass medical liability reform.

In a lighter moment, the president drew laughter in the House chamber when he pointed out that the first of 78 million baby boomers will turn 60 this year -- "including two of my Dad's favorite people: me and President Clinton."

The boomers will place unprecedented strains on the federal government, he said, with Medicare, Medicaid and Social Security accounting for almost 60 percent of the entire federal budget by 2030.

Noting that Congress failed to act last year on his proposal for reforming Social Security, the president called for the creation of a bipartisan commission to study the impact of baby boomer retirements on federal entitlements.

On the disease-fighting front, Bush asked Congress to reform and reauthorize the Ryan White Act, federal legislation that funds primary health care and support services for people with HIV. He also asked for an as-yet unspecified amount of new funding to states "to end waiting lists for AIDS medicines in America," where half of all AIDS cases occur among blacks. And he vowed to lead a nationwide effort to deliver rapid HIV tests.

Bush also again affirmed his moral opposition to human cloning in every form. He called for legislation that would prohibit creating or implanting embryos for experimentation, creating human-animal hybrids, and buying, selling or patenting human embryos.

More information

For more details on the president's health agenda as outlined in the State of the Union address, visit the White House.

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