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President Bush Offers Health Insurance Proposal at State of Union Address


Health spending is rising faster than incomes in most developed countries, and that trend is particularly acute in the United States where 46 million Americans lack health insurance and affordable health care. President Bush proposed a health care reform initiative in his State of the Union address on Tuesday that is getting a mixed reaction from health insurance experts.

Rita Azar owns a flower shop and cafe in Los Angeles, California. Azar says she cannot afford health insurance for her employees. "Do I wish I could give them insurance? Absolutely."

Azar's situation is like that of other small business owners. Harold Goldmeier runs a paint and decorating store in Chicago. He says he has a hard time keeping up with the cost of health insurance. "It rises faster than any fixed costs that we have, whether it's property taxes, electricity, rent, anything else."

Employers are bracing for a possible increase in the minimum wage. Add that to steeply health insurance premiums and the result is a serious health care situation that doctors say leads to unnecessarily higher death rates.

Ron Pollack with Families USA, a consumer group devoted to health care issues, says, "Companies, individuals, government agencies are all finding these costs unaffordable."

Most Americans get health insurance from their employers, although many employers are now reducing the benefits they offer or opting out of offering health insurance altogether.

Herrick Industrial Supply in Utah had to reduce its health insurance benefits package.

Joe Call does the company's books. "We're not in the same situation that the health care industries are in,” he says. “They're able to raise their prices whenever they want to, it seems."

In his State of the Union speech, President Bush proposed making health insurance policies tax deductible.

"With this reform, more than 100 million men, women and children who are now covered by employer provided insurance will benefit from lower tax bills."

Some analysts say the tax break could be an incentive for some people to buy health insurance.

Others say those who need the help the most -- those with moderate incomes or those earning minimum wage, would not benefit from this proposal because insurance premiums would still be too costly.

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