WASHINGTON—In his State of the Union address, President Bush offered several health-care proposals. Below are pros and cons on some of his ideas.
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EXPAND HEALTH SAVINGS ACCOUNTS
PRO: Would make it easier for older, better-off Americans to set aside more pre-tax dollars to save for current health expenses and medical expenses in retirement.
Younger workers who don't spend much on health care may prefer paying lower premiums in a high-deductible insurance plan.
CON: Poor and middle-class Americans would benefit less because they have less disposable income, pre-tax or otherwise, to set aside to pay for future medical expenses.
For details on HSAs, go to: http://www.treasury.gov/offices/public-affairs/hsa/pdf/hsa-basics.pdf
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EXPAND TAX DEDUCTION FOR CONSUMER HEALTH-CARE EXPENSES
PRO: Would make tax code fairer to working poor and uninsured. Both often pay for health care out of pocket, with few of the tax benefits that go to employer-provided health plans.
CON: Open to abuse if expenses eligible for deduction aren't clearly defined. Lost tax revenue could worsen already high budget deficits.
For details on what medical spending now qualifies for an itemized deduction, go to: http://www.irs.gov/pub/irs-pdf/p502.pdf
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CAPPING MEDICAL MALPRACTICE LAWSUITS
PRO: Could reduce "defensive" medicine—doctors ordering unneeded tests in order to minimize the threat of potential negligence suits.
CON: Negligent doctors don't suffer full consequences for their mistakes. Could discourage settlements if there's a ceiling on liability.
For more information on the debate, go to: http://www.balancedpolitics.org/malpractice_lawsuits.htm
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(c) 2006, Knight Ridder/Tribune Information Services.
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