    [Public Papers of the Presidents of the United States: George W. Bush (2004, Book I)]
    [January 28, 2004]
    [Pages 143-150]
    [From the U.S. Government Publishing Office www.gpo.gov]

    Remarks on Access to Health Care
    January 28, 2004

        The President. Thank you for being here. Please be seated. Thanks
    for coming. If you're wondering who these characters are behind me,
    these are people who have just shared their stories about what it means
    to be an employer or employee and facing rising costs of health care.
    The cost of health care is an issue in our country, and we must deal
    with it in a rational way. And that's what I want to discuss with you
    today.
        I want to thank those folks who are standing behind me for sharing
    their stories. I will try to do my best to share some of their stories
    with you. They come from all parts of our country. George Akers, for example, is from Naples. He's here with his boss,
    who owns the company, a small-business entrepreneur. That would be
    Naples, Florida. Joe is from Horizon Builders in
    Maryland. Pam Wimbish is from Illinois. She's
    self-employed. Rick Bezet is the pastor of the
    New Life Church in Little Rock, Arkansas. These are people who are
    working for a living, people who are employing people, people who are
    worried about health care.
        Phil Hadley is, as I told you, is George's
    boss. He's an entrepreneur. He's a--one of the great parts of America is
    the entrepreneurial spirit of our country. The fact that small
    businesses are vibrant and alive is an important part of the economic
    recovery of our country. After all, most new jobs are created by small-
    business owners, people who are dreamers and hard workers. But Phil told
    me he's worried about making sure his employees are covered by good
    health care.
        Lynn Martins is with us. She's a
    restaurant owner. She is selling food and, at the same time, worried
    about whether or not the people that are waiting the tables can get
    insurance.
        The Sameses are with us, Krista and
    Ted. They're self-employed. By the way, Kris is

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    a home-schooler; she home-schools her children. And they've decided to
    do something about the high cost of health care by taking an innovative
    approach to buying health care, which I'm going to describe to you here
    in a minute.
        Anyway, thank you all for coming. These are--their stories are
    typical stories. Their stories are the stories that occur every day in
    America as people make decisions about how to allocate money toward
    health care.
        Fortunately, the positive news is that we've got the best health
    care system in the world. And we need to keep it that way. We need to
    keep it that way by keeping the private market strong, by resisting
    efforts that are happening in Washington, DC, to say the Federal
    Government should be running health care. See, we don't believe that. I
    don't believe it. I believe the best health care system is that health
    care system generated in the private markets.
        And the best way to keep the private markets strong is to make sure
    we've got the best research and development, is to make sure the doctor-
    patient relationship is strong, is to empower consumers to make more
    choices, is to give them more opportunities to make choices in the
    private sector.
        We're making progress in terms of the modernization of the health
    care system, starting with the Medicare bill that was passed. The
    Medicare bill said we have an obligation to our seniors in our country,
    and we need to fulfill that obligation. And for the first time since
    Medicare was founded, I had the honor of signing a bill that modernizes
    the system, which essentially says there needs to be prescription drug
    coverage for seniors; there needs to be preventive care available for
    seniors; and seniors need to be given options to choose from, to tailor
    a program that best meets their needs. The Medicare bill is a vital part
    of a vibrant health care system. I was proud to sign it, and any attempt
    by Congress to weaken it will meet my veto.
        One of the ways to help make sure health care functions better is to
    help people who can't afford health care to have access to health care,
    access other than emergency rooms and hospitals. And so I'm a big
    proponent of what's called community health centers that operate primary
    care services in rural and underserved urban areas. When I showed up
    here in Washington, there was about 3,000 of them. I vowed that we would
    expand and/or open 1,200 more. We've done 600--we've met 600--we've
    fulfilled half our obligation, as far as I'm concerned. And in the
    budget I'm submitting, we will finish the additional 600 in years 2005
    and 2006. This is a smart way to make sure that people get health care.
    It's more cost-effective that people are able to go to these centers and
    not go to an emergency room, which is by far the most expensive way for
    somebody to get health care.
        Congress needs to pass refundable tax credits to help the working
    uninsured. It's an approach that says we trust low-income Americans to
    be able to make the rational decision for their health care.
        Another thing we need to do here in Washington is to promote the--
    make sure health care technology is widespread, that the--even though
    medicine is modern in the sense that we're making great new discoveries,
    it's kind of ancient when you think about how the records are kept. When
    you're still writing records down by hand and sharing information
    through files, it's not exactly a modern system. And we believe a lot of
    medical errors can be saved as a result of the use of proper technology,
    and there will be cost savings to be had as well.
        Another way to save costs, to stop the rise of the cost of health
    care, is there for to be rational laws in dealing with doctors. Our
    legal system is out of control right now. There's just too much
    litigation. There's frivolous and junk lawsuits all over the country.
    It's like there's a giant lottery, and the lawyers are the only winners.
    And

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    we're driving good docs out of business. Make no mistake about it, a lot
    of good docs are stopping to practice medicine because their premiums
    are going up because of the junk and frivolous lawsuits. And so these
    lawsuits, which are--people will settle just to get them out of the
    way--raises costs. Doctors, for fear of being sued, practice what's
    called defensive medicine. That raises the cost. As a matter of fact,
    the cost of premium increases and the cost of defensive medicine--in
    other words, prescribing too much to cover yourself so if you get sued,
    you can say, ``Well, wait a minute. I did everything I could''--costs
    the Federal Government about 28 billion a year. Think about that--$28
    billion. That means it's costly to the taxpayer.
        I view this as a national issue that requires a national solution.
    And so I proposed medical liability reform. The House passed a good bill
    which recognizes that if--by the way, if you get hurt, you ought to
    recover full economic damages. In other words, if a bad doc practices
    bad medicine, there ought to be a consequence. But there ought to be a
    cap on noneconomic damages.
        The House passed the bill. It's stuck in the Senate. Senators have
    got to understand, if they're truly worried about health care costs, we
    need medical liability reform that's fair and reasonable--fair and
    reasonable. We want health care to be affordable and accessible. When
    you drive doctors out of business and drive the cost up because of
    lawsuits, medicine becomes less affordable and less accessible.
        The Medicare bill I signed in December created an additional tool
    that will help workers lower their health care costs, and they're called
    health savings accounts. They became available on January 1st. Health
    savings accounts address a growing need in our health care system. These
    accounts will help working Americans afford health insurance that is
    growing out of their reach. They will help restrain the health care
    costs that are affecting us all.
        Right now, many insurance plans will cover virtually all of your
    health care costs in exchange for a high premium payment, which is paid
    by employers and their employees in various percentages, in different
    percentages. Under America's system of private medical care, families
    will continue to have this option, of course. We just want to provide
    additional options for families from which to choose, and the health
    savings account is one such option.
        Under the system that currently exists, consumers really don't know
    how far their health care dollars are going. You pay the premium, and
    then you just show up and collect the benefits. You have no idea what
    you're spending money on. They pay a flat rate for insurance, but they
    really don't know the true costs of medical services they receive.
    There's no demand for better prices. There's no selectivity in the
    marketplace. There's no pressure on the price structure of health care.
        When consumers don't have the incentive to get better prices, costs
    go up, and that's what's happening in America. And then when costs go
    up, insurance companies pass on those costs in the form of higher
    premiums, so everybody pays. That's the current system we have today.
    And it's those higher premiums and increasing costs that make it
    difficult for some to have health care insurance.
        The doctor-patient relationship is also a vital part of a good
    health care system. And as these folks behind me said, you know, they
    got a little tired of having bureaucracies in between the patient and
    the doc. And that's what's happened in certain segments of the health
    care industry.
        And we need a consumer-driven health care system, and we need better
    information about health care prices. And a consumer-driven health care
    system with better information will help control the cost of health
    care. That's the rationale of the health savings accounts.
        The best way to empower citizens is to let them save and spend their
    health care

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    dollars as they see fit--in other words, start to empower people to make
    the right decisions with their health care dollars; give them control
    over routine costs so that people see the doctor when they need to,
    spend their dollars wisely, and still be able to have coverage for major
    medical bills.
        The health savings account incorporates the philosophy I just
    described. There's two major features. First, to get a health savings
    account, you or your employer must obtain a separate high-deductible
    insurance policy to cover major medical expenses, such as surgery or
    hospital stays. The premiums for these high-deductible plans cost far
    less than traditional insurance. Yet the plans still cover for major
    expenses.
        Secondly--the good news, by the way, is insurance companies are now
    beginning to offer these plans more and more, along with HSAs. In other
    words, the market is demanding and the suppliers are providing these
    kinds of high-deductible catastrophic plans, I guess is the best way to
    describe them. They don't cost nearly as much as normal group plans
    cost.
        Secondly, to cover routine medical expenses--in other words, this
    part of the--this aspect of the health care system says, ``We'll cover
    major costs for you at a much reduced cost to the consumer.'' Second, to
    cover routine medical expenses such as bills for regular doctor visits
    or medicines, you can set up a health savings account with up to $2,600
    a year for an individual or up to $5,150 for a family.
        Now, contributions to these accounts are tax-free. The earnings in
    these accounts--in other words, if you don't spend all the money and you
    got that money invested, the earnings are tax-free, and when you
    withdraw them to pay for routine medical expenses, the withdrawals are
    tax-free. In other words, there's incentives built in for people to put
    money aside to meet routine medical expenses, expenses other than costly
    catastrophic expenses or high hospitalization expenses. Because the HSA
    is tax-free, it will save the Americans between 10 to 35 percent of out-
    of-pocket medical expenses, depending on a person's tax bracket.
        Not only does the HSA start to empower you to make decisions; it
    actually provides tax relief at the same time. Whatever you don't spend,
    by the way, in a year--you put 2,600 in, you don't use all that money--
    that can be saved for future medical bills. In other words, you start to
    save money and accumulate money. So instead of sending all your health
    dollars to an insurance company, you and your employer can use an HSA to
    lower your insurance premiums, to cover major medical bills, and to keep
    the savings to cover routine costs, and to save for future issues you
    may have to deal with.
        When more Americans sign up for these HSAs, we'll see positive
    effects for our families and the economy this way: First, many American
    families who choose HSAs will pay less overall for their health care.
    People behind me who have chosen HSAs will testify that that's the case.
    I'm going to testify on their behalf here in a minute. [Laughter]
    Insurance premiums will be lower, and people will be able to draw from
    tax-free money to pay for routine expenses.
        Secondly, HSAs will encourage people to spend wisely for their
    routine medical expenses. If you put in 2,600 tax-free, that 2,600 is
    yours, and if you spend unwisely, you're spending your own money
    unwisely, and you begin to see the consequences as the savings for that
    particular--or the contribution for that year begins to dwindle. When
    people consider the true costs of their medical care, they will push
    health care providers to offer better services and better prices. When
    it's your money you're spending, you see it; you write the check; you
    have the tendency to demand better service. If somebody else is spending
    the money for you, there's no cost control because the demand--the
    decisionmaking process has been taken out of the economic equation.

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        Third, HSAs will encourage people to save for their health care
    needs both now and in the future. We encourage people to save for their
    future retirement needs. HSAs do the same thing for medical needs.
    There's incentives built in to encourage savings, and that's important.
        Fourth, because citizens will see savings on an annual basis as a
    result of wise choices they make, there is an incentive to take care of
    their bodies and to live healthier lives. This is the beginning of,
    hopefully, what will be the next wave of medicine and the direction of
    medicine, is how do we encourage people to make right choices? How do we
    prevent disease in the first place?
        As you know, I'm an exerciser. I like to exercise. I exercised a
    little too much, and my knee hurts. [Laughter] But nevertheless, I
    feel--I made the right choice to exercise on a daily basis. I'm a
    healthier person for it. And HSA--that would show up in an HSA because
    there would be more money left over on an annual basis because I am a
    healthier person, more of my own money that will be accumulating, that
    will be being saved. The healthier your life, the more money you build
    up tax-free in your health savings account.
        Fifth, HSAs will make it easier for some people who are now
    uninsured to purchase health insurance. Low premiums mean greater
    affordability and greater accessibility, especially for small businesses
    who are having trouble paying for the health insurance for their
    employees.
        Because some people may not be able to afford these low-cost plans,
    I made a proposal to strengthen HSAs. I did so in my State of the Union.
    If your employer does not contribute to your premiums, you should be
    able to deduct from your income taxes the cost of your premiums for your
    high-deductible insurance. If you really think about what I've just
    said, it provides an interesting opportunity for small businesses who
    aren't paying for health insurance to be able to encourage an employee
    to do so.
        Much of the money you contribute to the HSA and the money you spend
    on premiums--so the money you contribute--not ``much,'' all the money
    you contribute to your HSA--and the money you spend on your premiums for
    high-deductible insurance will not be taxed. This is an incentive plan
    to encourage people to be able to have an insurance policy that's
    affordable. And it's necessary, and it's needed. And the Congress needs
    to understand how responsible the decision they made in the Medicare
    bill was. I mean, this is a major reform in a positive way for the
    American people.
        The other thing we need to do--and Congress needs to listen to--is
    the call for association health plans. What that means is small
    businesses can band together across the country to negotiate lower
    health insurance rates and cover more workers. See, State rules prevent
    many small businesses from working together to increase their buying
    power, which makes it harder for them to offer affordable coverage for
    their employees. It makes sense, when you think about it, to allow
    people from Texas and Oklahoma to bind risk, to share risk. If you're a
    restaurant owner in Texas, you ought to be able to take your employees
    and put them in the same pool as a restaurant owner in Maryland, so you
    can spread the risk.
        You'll hear a story here in a second about a restaurant
    owner that can't share risk and,
    therefore, is in a--has to buy a group plan or try to buy a group plan
    without the benefits of large purchasing power. Big companies have got
    purchasing power. Small businesses ought to be allowed to bind together
    so they've got the same purchasing power.
        And the Congress needs to act on association health plans. This is
    an important part of making sure the small-business sector of America is
    strong and vibrant. The

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    bill passed the House. It's stuck in the Senate. The Senate ought to
    act. And for those of you who are concerned about health care for--the
    cost of health care for small businesses, you need to let your Senators
    know. There's no excuse for this bill not to go forward. It would be a
    major reform. It would help a lot of small-business owners in the
    country.
        Let me tell you some stories. Speaking about small businesses, I
    told you Phil Hadley is here. He's with Collier
    Pest Control out of Naples, Florida. He's got an employee with him named
    George Akers, who's with us. George is the guy
    with the flat-top, the turtleneck--[laughter]--has never seen snow
    before. [Laughter] He's the real deal. [Laughter]
        Collier was having trouble buying health insurance that the company
    could afford, the people could afford, working for them. The premiums
    were going up year after year. And George was
    getting tired of it and was contemplating not having any insurance at
    all--wanted to work but--about to try to self-insure, which would be
    highly risky. He bought him a new HSA. Phil
    found it; they worked together on it. The HSA and the lower premiums
    that he pays to cover catastrophic care saves George about $5,500 a
    month.
        George Akers. No, a year.
        The President. A year--[laughter]--5,500 a year. I meant to say $550
    a month. Five thousand, five hundred a year. Think about that. He went
    from worrying about having health insurance at all to taking a health
    savings account, and he now saves $550 a month. Actually, it's more than
    $5,500 a year. [Laughter] He's covered for catastrophic care. He's got
    incentives in his own plan to make right choices, to cover the routine
    medical costs.
        Pam Wimbish is with us from the Chicago
    area. She's self-employed. She was worried about health care. There's
    Pam. She was really worried about health care. She had a high-cost
    insurance plan, and being a self-employed person, she was kind of
    wondering what's next, what happens next year or next month, when you
    get high bills. There are a lot of self-employed people in America, by
    the way, a lot, a lot of sole proprietors, a lot of one-person shops out
    there making a huge contribution to our economy.
        She signed up for an HSA. It's made a huge
    difference, she said. She's saving money. She's saving money not only in
    the outflow; she's saving money by the account building up, the HSA
    account, which is her savings account. It's her own money available for
    health. And there's nothing like having your own--managing your own
    system, is there? I mean, there's just something inherently American
    about controlling your own destiny, and that's what these HSAs do.
        The Sameses are with
    us. I mentioned that Krista is a home-schooler. I also forgot to tell
    you she's an accountant. Ted is a doc. They're a professional family,
    just like a lot of other families in America. They purchased an HSA.
    They're using HSAs. They found that an HSA makes their life--their
    desire to make sure their family is insured so much more affordable and
    reasonable.
        Rick Bezet is with us. He's a pastor in a
    Little Rock church. You think--he's got a couple of flocks he must tend
    to--one is the people who come to church, but he's also an employer.
    He's got people working for him. He's saving about $5,000 per employee
    per year by switching to a health savings account.
        These people care deeply about their employees. They want them to be
    satisfied workers. And they're now taking advantage of new law, which
    provides interesting financial opportunities for their businesses.
        Joe Bohm is with us. Joe is a homebuilder
    from Crofton, Maryland. He's got 90 employees. Just like a lot of other
    small businesses, his premiums went up 15 percent this year, and he's
    tired of it. And he's tired of not having the capacity to bargain better
    with a group of people just

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    like--in the same situation he's in. But the law won't allow it.
        There's some--people say, ``Why won't the law? It sounds rational,
    why won't it?'' Because there are some vested interests that won't allow
    this to happen. I guess there's people not willing to allow for there to
    be competition. They don't want to give up any market share. They like
    the fact that Government won't let people compete. I don't. The more
    competition the better, particularly when it comes to making sure people
    are able to get a better deal for their health insurance.
        Lynn Martins is with us. She runs
    Seibel's Restaurant. She says it's pretty good food, if you're
    interested. [Laughter] She used to be in an association health plan in
    her State, Maryland. Then, incredibly enough, they said, ``You can't use
    those plans anymore. You can't have an association health plan.'' And
    guess what happened? The premiums went up 50 percent--because the State
    wouldn't allow for there to be association health plans, and her little
    stand-alone business doesn't have the same purchasing power in the
    marketplace, and the premiums went up. Bad law, bad decisions by
    lawmakers, ran her premiums up. And they're still going up.
        And so she, too, wants to be able
    to be in an association health plan. She wants restaurateurs to be able
    to pool and get better costs in the marketplace. She's also fascinated
    by health savings accounts. She wasn't exactly sure what they were, and
    then all of a sudden she started hearing the stories of people standing
    behind me, and it dawned on her that this is perhaps a really good way
    to make sure her employees have got health insurance.
        Imagine the combination of health savings accounts and association
    health care plans together. I mean, you're talking about providing
    interesting opportunity for the small-business sector in America. And
    remember, we're interested in job creation, and we need to make sure the
    small-business sector is as strong as possible. Tax relief is one way to
    invigorate the small-business sector. Congress needs to make all that
    tax relief permanent, by the way. And another way is to address the high
    cost of health care by rational policy. And today I described a series
    of steps of rational policy. The Congress must act on it. If they're
    truly interested in health care costs in America, I've just laid out a
    way, a strategy for them to address the costs, address the costs in a
    way that does not undermine the private sector, undermine that part of
    our health care philosophy that has made us the greatest in the world.
        We don't want the Federal Government running health care. We don't
    want the Federal Government making decisions. Private medicine needs to
    be invigorated and strengthened, and the way to do that is give people
    more options, empower consumers, protect the doctor-patient
    relationship, and allow small businesses to pool their risk so they can
    provide good insurance for their employees.
        Thank you for coming and giving me a chance to describe a vision for
    a better America when it comes to health care. Please feel free to
    contact the Members of Congress in the Senate. [Laughter]
        Again, I want to thank my fellow Americans for standing up here to
    help add some credibility to the stories I've just told you. They are
    living proof of what can happen when people are given good choices to
    make, and proof of what happened--for the need for us to make sure
    Congress continues to implement good policy.
        Appreciate you all coming. God bless. Thank you.

    Note: The President spoke at 10:55 a.m. in Room 450 of the Dwight D.
    Eisenhower Executive Office Building.

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