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Bush Vague on How to Fun HIs New Health Care Proposal

By Douglas Jehl
Los Angeles Times

CLEVELAND

President Bush Thursday unveiled a much-touted plan he said would cut health costs and guarantee access to care, but he offered no clear explanation of how his administration would pay the $100 billion price tag.

"We'll figure that out," Bush said as he began the cross-country trip to drum up support for the election-year initiative.

In presenting the package here, he proclaimed that its market-based approach would "preserve what works and reform what doesn't" in a health-care system choked by mounting costs. He warned that alternatives proposed by his Democratic rivals would force the nation to "swallow a cure worse than the disease."

At the heart of the Bush proposal is a plan to offer new tax breaks to help low- and middle-income families pay for health care. At the same time, it would slash Medicaid funding by about $35 billion over five years, in part to force states to model their systems on health-management organizations.

But what Bush described as a "comprehensive" plan otherwise left unspecified how its vast costs would be borne. While pointing to a series of ways to make the health-care system more efficient, administration officials said they would begin to fill in the details only if Congress shows interest in the program.

Their studied vagueness underscored the politics behind a program to be used as a bludgeon to attack rival Democratic proposals as steps down a slippery slope toward socialized health care.

While peddling the Bush program as a free-market alternative, the White House seemed determined to avoid giving offense to any quarter. Its 94-page White Paper was at its most specific in a final chapter outlining "problems with other approaches."

Bush used his appearance here less to discuss the details of his plan than to attack the so-called "play or pay" approach and other Democratic-backed alternatives. Although the plan to cut Medicaid funding would generate the program's biggest savings, he made no mention of the potentially controversial proposal in his 25-minute speech.

"We stand at a crossroads," he told the Greater Cleveland Growth Association. "We can move forward to dramatically reform our market-based system or we can force ourselves to swallow a cure worse than the disease."

Bush assured the group of business leaders that his plan would "give Americans the kind of health care they want and deserve and put an end to the worry that keeps them awake at night."

To maximize the political impact of the health-care plan, the White House had held its details from the State of the Union address and federal budget Bush proposed last week.

He traveled to Cleveland to formally unveil the plan in part as tribute to efforts of health-care reformers in the city to encourage small businesses to band together to gain access to more affordable insurance coverage, a principle embraced in the White House plan.

But his audience here appeared no more than mildly enthusiastic about its contents and interrupted his speech only once with applause, when Bush referred to a previously announced proposal to impose limits on malpractice suits.

The proposal Bush outlined here has been in the making for more than eight months. But its drafting was accelerated late last year after an upset Democratic victory in a Pennsylvania Senate race made clear that health care had become an issue of election-shaping importance for many voters.

In contrast to various Democratic promises of health care for all, sometimes under government auspices, the Bush plan promises only universal access to health care through tax credits and tax deductions designed to make health insurance affordable.

The proposed new assistance to low- and middle-income families would decline according to wealth, but would cost taxpayers $35 billion a year after being phased in over five years. A needy family of three or more whose income fell below the poverty line would receive the maximum benefit of $3,750.

To remove another barrier to coverage, the Bush plan would require insurance companies to provide health plans to all groups that sought them. It would prohibit insurance firms from denying an application because of the illness of an employee who had previously been insured.

But the plan would stop short of requiring that insurance companies provide coverage even to new applicants, offering no new guarantee to those denied health care because of AIDS, cancer or other pre-existing conditions.

The approach aims to preserve a health-care system Bush said should be based on "choice, not central control." Administration officials said its main cost-cutting measure -- to end unlimited federal reimbursement of Medicaid expenses -- was designed to force states to emulate the private sector in creating scaled-down health-care plans.

But the absence of further detail about how the plan might be funded reflected what White House officials conceded was an election-year reluctance to offer targets for political attack.

The officials said the vagueness reflected the defeat of policy aides in a fierce internal White House battle in which chief of staff Samuel K. Skinner and re-election campaign officials warned that specificity could backfire against Bush.