A modest proposal.

Byline: The Register-Guard

President Bush's State of the Union address contained a constructive proposal to expand access to health insurance in an unfair health care system that fails to cover 47 million Americans.

Unfortunately, Bush's idea is an order of magnitude too modest to compete with more comprehensive proposals such as the one recently unveiled by Sen. Ron Wyden of Oregon. Nonetheless, it's a move in the right direction: away from the nation's overdependence on employer-provided health insurance.

The president proposes to "help more Americans afford their own insurance" by changing the tax code to treat medical insurance benefits as taxable income. In addition to allowing the government to tax health benefits as compensation, Bush would create a standard tax deduction for health insurance of $15,000 for families and $7,500 for single Americans, regardless of whether they buy their own health insurance or get it through work.

Anyone with employer-provided or privately purchased health insurance that costs less than the standard deductions would save money on their taxes. Conversely, employees or individuals with plans that exceeded the caps would pay federal income tax on the difference.

So far so good. Right now, private health coverage averages $11,500 a year for a family of four and $5,200 for individuals. Bush's proposed change to the tax code would offer a more progressive alternative that provides incentives for people to purchase private insurance, but only as much as they need.

But by the administration's own estimates, only 3 million to 5 million of the nation's 47 million uninsured will benefit from Bush's proposal. In addition, because it is structured as a tax deduction rather than a tax credit, people with higher incomes will reap the greatest benefits. Forty-three percent of the uninsured have such low incomes that they pay no taxes, according to the Kaiser Family Foundation.

Though it's designed to motivate more people to purchase private health insurance, Bush's plan doesn't address the private insurance industry's ability to deny or limit coverage to older individuals or those with pre-existing conditions. His plan won't help a diabetic or cancer survivor to find an affordable policy.

For the 20 percent of American workers with excellent employer-provided coverage - Bush uses the term "gold plated" - the president's plan represents a tax increase. Worse, it could hasten a growing trend among employers to reduce or eliminate health coverage for their workers before any affordable alternatives are available.

Bush's ideas deserve consideration, particularly if the administration is open to reconfiguring its benefit as a tax credit rather than a deduction. But they do not represent anything approaching a comprehensive solution to the nation's health care coverage crisis.

Contrast the president's modest proposal with that of Senator Wyden. The Oregon Democrat announced a plan in December to provide affordable health insurance for all Americans that offers benefits comparable to those in the standard Blue Cross Blue Shield policy for federal workers and members of Congress.

Wyden's plan offers guaranteed eligibility. No one could be denied coverage based on previous or existing health problems, occupation, genetic information, gender or age. Once enrolled, individuals would be covered until retirement, when they would become eligible for Medicare.

The time for incremental tinkering with the nation's broken health care system is long past. While Bush's contribution to the conversation is worth exploring, Wyden clearly has a better grasp of the scale of the problem and the kinds of solutions it will require.