Bush to announce health care tax incentives

President Bush yesterday said he wants to expand health care coverage by putting incentives into the tax code for individuals to buy their own, and that he will lay out a detailed plan in Tuesday's State of the Union speech.

In his weekly radio address Mr. Bush said his plan will treat health insurance like a mortgage.

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

The changes will require congressional action and Mr. Bush, now facing a Democratic majority in Congress, ruled out raising taxes or "creating a new federal entitlement program" as possible options for expanding health care.

The White House has told Republicans on Capitol Hill that Tuesday's address will make the most news on health care and energy policy. Aides have said the speech will forgo the usual laundry list of new programs and instead focus on those two areas and three others: the war on terrorism, immigration and education.

"President Bush will outline issues where he believes we can find common ground with the new Congress," spokeswoman Dana Perino said.

In his radio address Mr. Bush called for aiding states that are trying innovative programs to broaden health coverage.

In doing so, he is returning to a strength of the Republican Party in the 1990s, when governors pioneered welfare reform plans and the federal government followed their lead.

Former Massachusetts Gov. Mitt Romney, a Republican now exploring a run for president, created a program in his state that sought to cover those eligible under existing programs such as Medicaid, subsidize coverage for the poor who are ineligible, and punish those who can afford it but don't sign up through penalties such as higher taxes.

And earlier this month, California Gov. Arnold Schwarzenegger, a Republican, announced his own plan to require all residents to have health insurance and to force most companies to provide insurance for employees or face a higher tax rate.

With Democrats now in control of Congress and promising to push plans to expand health care coverage, Mr. Bush is trying to get out in front of them and set the parameters for the debate.

"Health insurance should be available, it should be affordable, and it should put you and your doctor in charge of your medical decisions," Mr. Bush said, calling on Congress to pass the package he will propose Tuesday.

House Ways and Means Committee Chairman Charles B. Rangel, New York Democrat, is not embracing the idea.

"This is a dangerous policy that ultimately shifts cost and risk from employers to employees and could result in a higher number of uninsured," Mr. Rangel said.

Census Bureau data show that 46.6 million individuals, or 15.9 percent of the population, were without health insurance in 2005. That was 1.3 million more than in 2004.

The figures show that Medicare and Medicaid, the main government insurance programs, cover an increasing percentage of the population, while employer-sponsored health plans and plans bought by individuals both declined from 2004 to 2005.