(January 20 ,2007)

THE PRESIDENT: Good morning. For many Americans, the new year began with a resolution to live a better and healthier life. Whatever goals you have set for yourself this year, one goal we can all share is reforming our Nation's health care system.

Americans are fortunate to have the best health care system in the world. The government has an important role to play in our system. We have an obligation to provide care for the most vulnerable members of our society -- the elderly, the disabled, and poor children and their parents. We are meeting this responsibility through Medicare, Medicaid, and the State Children's Health Insurance Program. We must strengthen these vital programs so that they are around when future generations need them.

For all other Americans, private health insurance is the best way to meet their needs. But rising health care costs are making insurance too expensive for millions of our citizens. Health care costs are growing more than two times faster than wages, and this is making it harder for working families to buy insurance on their own. Rising costs are also making it harder for small businesses to offer health coverage to their employees. Our challenge is clear: We must address these rising costs, so that more Americans can afford basic health insurance. And we need to do it without creating a new Federal entitlement program or raising taxes.

Our Nation is making progress toward this goal. We created Health Savings Accounts, which empower patients and can reduce the cost of coverage. We are working to pass Association Health Plans, so that small businesses can insure their workers at the favorable discounts that big businesses get. We must pass medical liability reform, so we can stop the junk lawsuits that drive costs through the roof and good doctors out of practice. We've taken important steps to increase transparency in health care pricing, and give patients more information about the quality of their doctors and hospitals.

One of the most promising ways to make private health insurance more affordable is by reforming the Federal tax code. Today, the tax code unfairly penalizes people who do not get health insurance through their job. It unwisely encourages workers to choose overly expensive, gold-plated plans. The result is that insurance premiums rise, and many Americans cannot afford the coverage they need.

We need to fix these problems, and one way to do so is to treat health insurance more like home ownership. The current tax code encourages home ownership by allowing you to deduct the interest on your mortgage from your taxes. We can reform the tax code, so that it provides a similar incentive for you to buy health insurance. So in my State of the Union Address next Tuesday, I will propose a tax reform designed to help make basic private health insurance more affordable -- whether you get it through your job or on your own.

As we reform the Federal tax code, we will also support the innovative measures that states are taking to address the problem of the uninsured. Governors across the Nation have put forward plans to make basic private health insurance more accessible for their citizens. When I go before Congress next week, I will announce a new effort -- led by Health and Human Services Secretary Michael Leavitt -- to help governors reduce the number of people in their states without private health insurance.

All of these changes are based on a clear principle: Health insurance should be available, it should be affordable, and it should put you and your doctor in charge of your medical decisions. I look forward to working with Congress to pass the initiatives that I lay out next week, so we can help millions more Americans enjoy better care, new choices, and healthier lives.

Thank you for listening.


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