In State of the Union, Bush Asks Congress for Action on Uninsured, Patients’ Rights, Medicare, But Party Divisions, Deficit Could Impede Progress

During his Jan. 29 State of the Union Address, President Bush called on Congress to pass a patients' bill of rights and legislation reforming Medicare that includes a prescription drug benefit, saying, "Americans know economic security can vanish in an instant without health security." The proposals were included under the third of three main goals outlined by the president in his first State of the Union address: winning the war on terrorism, bolstering homeland security and repairing the nation's economy. Bush also said his proposed budget advances the second goal by increasing funding for both bioterrorism preparedness and emergency response capabilities. "We will develop vaccines to fight anthrax and other deadly diseases. We'll increase funding to help states and communities train and equip our heroic police and firefighters," he said. In addition, the president introduced a new voluntary service program for Americans, called the U.S.A. Freedom Corps, that will work to increase homeland security, and he called on retired doctors and nurses to make themselves available in "major emergencies" through that program. Returning to an issue that Congress has debated since the Sept. 11 attacks on the World Trade Center and the Pentagon, Bush urged lawmakers to pass an economic stimulus package that would provide health insurance subsidies to unemployed workers, as well as tax credits for purchasing coverage. Finally, he asked Congress to approve a "historic increase in spending for veterans' health" (Bush speech text, New York Times, 1/30).

Foreign and Domestic
In the 48-minute address, Bush sought to link the success so far in the war on terrorism to the advancement of his domestic goals, including his health care proposals, the Washington Post reports. "We have clear priorities and we must act at home with the same purpose and resolve we have shown overseas," he said (Milbank, Washington Post, 1/30). The Los Angeles Times reports that Bush called on Congress to apply the "same spirit of cooperation" and bipartisanship seen in the war to domestic issues (Brownstein, Los Angeles Times, 1/30). To that end, lawmakers from both parties said they were pleased that Bush's speech put health care "back at the top of the policy agenda" (Brosnan, Memphis Commercial Appeal, 1/30). And in the Democratic response to Bush's speech, House Minority Leader Richard Gephardt (D-Mo.) affirmed his party's support for the president's foreign agenda and urged cooperation on domestic matters. "Now is not the time for finger-pointing or politics as usual," he said.

Meaningful Conciliation?
Nevertheless, Gephardt and other Democrats indicated that the two sides remain divided on several health care issues. "Our values call for helping patients and older Americans -- not just big HMOs and pharmaceutical companies -- ensuring that seniors don't have to choose between food and medicine," Gephardt said (Mitchell, New York Times, 1/30). In addition, the Los Angeles Times reports that the president "made the call for conciliation [on domestic matters] without signaling any substantive concessions on the key issues that have divided the sides" (Brownstein, Los Angeles Times, 1/30). For instance, in the few remarks Bush made about health care, he repeated his call for tax credits for the unemployed and broad-scale Medicare reform with a market-based component, two ideas opposed by many Democrats. Moreover, the two parties remain divided over the scope and size of a drug benefit under Medicare. Earlier this week, Bush proposed spending $190 billion over 10 years to reform Medicare, including $77 million to provide a benefit to seniors with incomes up to 150% of the federal poverty level, or $13,000 a year (Toner, New York Times, 1/30). Sen. Majority Leader Tom Daschle (D-S.D.) criticized the drug benefit plan, saying, "I don't think it's an idea that goes nearly far enough. ... [The drug benefit] falls far short of the universal approach that all Democrats and I think some Republicans support" (Hutcheson/Kuhnhenn, Philadelphia Inquirer, 1/30). (See story 5 for more reaction to Bush's Medicare reform proposal.)

Budget Deficit
With these differences between the two parties still present, it remains uncertain whether Bush will be able to parlay broad support for the war on terrorism into support for his health care proposals. This task is made even more difficult by the fact that Bush is proposing a budget that would create a deficit for the first time since 1998, the Philadelphia Inquirer reports. The president's fiscal year 2003 proposed budget, to be released Feb. 4, is expected to call for a 9% spending increase, and the White House Office of Management and Budget has predicted an $80 billion deficit for next year (Philadelphia Inquirer, 1/30). Bush acknowledged the deficit last night but said it "will be small and short term so long as Congress restrains spending and acts in a fiscally responsible way" (McManus/Gerstenzang, Los Angeles Times, 1/30). But several Democrats said that last year's tax cut combined with the significant increase in defense spending Bush is seeking will not leave any room for health care measures. "There's going to have to be some significant compromise here. ... Everybody knows we have to do more on homeland security. But we've got to do something on health care," Sen. Joseph Biden (D-Del.) said (Philadelphia Inquirer, 1/30). And discussing Bush's proposal for a Medicare prescription drug benefit, John Rother, policy director for AARP, said, "You'd give him credit for continuing to highlight the need for action on drugs, but at the same time there's not nearly enough resources in this budget to make it a reality" (Toner, New York Times, 1/30).

Excerpts, Interviews, and Analysis
Congressional Quarterly and kaisernetwork.org provide expanded coverage of last night's speeches and the year ahead in health policy online at http://www.kaisernetwork.org/healthcast/sotu2002. Coverage includes:

• State of the Union: This page includes health care-related clips and transcript from Bush's address, excerpts from Gephardt's response and analysis of the speech from Congressional Quarterly senior reporter Samuel Goldreich.
• Members to Watch: This page contains interviews by Goldreich with Sens. Chuck Grassley (R-Iowa), John Breaux (D-La.) and Jay Rockefeller (D-W.Va.) and Rep. Nancy Johnson (R-Ct.).
• What's Next: This page contains short interviews conducted by Goldreich with representatives from several health care interest groups, including Ron Pollack of Families USA and Karen Ignagni of the American Association of Health Plans.
• Capitol Hill: Looking Ahead: This page contains analysis by Goldreich of several issues facing Congress, including Medicare reform, patients' rights and bioterrorism, as well as related resources.