The August 21, 1996 signing of the Health Insurance Portability and Accountability Act represents the first major health reform legisltion signed into law. What impact will this new law have on business, insurance companies and the public? For a look at what the Clinton Administration is saying about the new law, click to the HHS Fact Sheet, Remarks by the President, Statement by the President and Press Briefing, below.

August 21, 1996

Contact: HHS Press Office (202) 690-6343

Background: On August 21, 1996, President Clinton signed into law the Health Insurance Portability and Accountability Act of 1996, which includes important new protections for an estimated 25 million Americans (approximately 1 in 10) who move from one job to another, who are self-employed, or who have pre-existing medical conditions. See Health Insurance Portability: Reform Could Ensure Continued Coverage for Up to 25 Million Americans (Letter Report, 09/19/95, GAO/HEHS-95-257). (protections offered by current state and federal health insurance portability reforms; the number of people who could be affected by broader national portability standards). The legislation, which was jointly sponsored by Sen. Edward Kennedy (D-Mass.) and Sen. Nancy Kassebaum (R-Kan.), was approved virtually unanimously by the House and Senate. It is designed to improve the availability of health insurance to working families and their children.

o Guaranteed Access for Small Business. Small businesses (50 or fewer employees) are guaranteed access to health insurance. No insurer can exclude an employee or a family member from coverage based on health status.

For example, until now, the owners of the "Good Food Cafe" have been unable to buy insurance for their 25 workers because insurance companies wanted to exclude "Bill Smith" from the policy because he has been diagnosed with cancer. Now all of the employees of "Good Food Cafe" will be able to obtain coverage.

o Guaranteed Renewal of Insurance. Once an insurer sells a policy to any individual or group, they are required to renew coverage regardless of the health status of any member of a group.

In other words, if "Mary Jones," one of the employees of "Good Food Cafe," develops a heart condition, the insurance company must renew the Cafe's policy without dropping "Mary" or the Cafe from coverage.

o Guaranteed Access for Individuals. People who lose their group coverage (for example, because of loss of employment or change of jobs to a firm without insurance) will be guaranteed access to coverage in the individual market, or states may develop alternative programs to assure that comparable coverage is available to these people. The coverage will be available without regard to health status, and renewal will be guaranteed.

So, if "Mary Jones" leaves her job with the "Good Food Cafe" to take a new job with "Zenith Tool and Die," which does not provide health coverage, Mary will be able to buy private insurance even if she is in poor health.

o Pre-existing Conditions. Workers covered by group insurance policies cannot be excluded from coverage for more than 12 months due to a pre-existing medical condition. Such limits can only be placed on conditions treated or diagnosed within the six months prior to their enrollment in an insurance plan. Insurers cannot impose new pre-existing condition exclusions for workers with previous coverage.

Finally, "Mary Jones'" new insurance company can only exclude coverage of her heart condition for a maximum of 12 months. And, this exclusion will be reduced for every month of coverage "Mary" previously had at the "Good Food Cafe."

o Enforcement. States have primary responsibility to enforce these protection. If states fail to act, the Secretary of Health and Human Services can impose civil monetary penalties on insurers. The Secretary of Labor will enforce these rules for self-insured (ERISA) plans. The tax code is modified to allow the Secretary of Treasury to impose tax penalties on employers or insurance plans that are out of compliance.

o Self-employed Individuals. The current tax deduction for insurance costs of self-employed individuals is gradually increased from 30 percent in 1996 to 80 percent in 2002. See, H.R.831, Tax deduction for self-insured (a bill to amend the Internal Revenue Code of 1986 to permanently extend the deduction for the health insurance costs of self-employed individuals).

o Medical Savings Accounts. From Jan. 1, 1997, to Jan. 1, 2000, firms with 50 or fewer employees and self-employed individuals enrolled in a qualified high deductible health plan can establish tax-favored medical savings accounts, or MSAs. Annual deductibles are $1,500 to $2,250 for individuals and $3,000 to $4,500 for families. Maximum out-of-pocket expenses are $3,000 for individuals and $5,500 for families. The maximum number of MSAs is limited to 750,000 for the 4-year demonstration period. See, Health Hippo: Health Insurance: MSA links.

o Fraud and Abuse Control. A new health care fraud and abuse control program is created, to be coordinated by the HHS Office of the Inspector General and the Department ofJustice. Funds for this program are appropriated from the Medicare Hospital Insurance (HI) trust fund;

-- Establishes the Medicare Integrity Program to be funded through appropriations from the HI trust fund;

-- Requires exclusion from Medicare and Medicaid for felony convictions related to health care fraud or controlled substances;

-- Creates a program encouraging Medicare beneficiaries to report fraud and abuse and offer suggestions to improve efficiency of the Medicare program, and provides for payment to beneficiaries in certain cases;

-- Requires issuance of advisory opinions, additional safe harbors, and fraud alerts regarding the anti-kickback statute;

-- Creates a new exception to the anti-kickback statute for certain risk-sharing organizations;

-- Expands conditions under which civil monetary penalties and intermediate sanctions can be imposed on HMOs participating in Medicare;

-- Establishes a data base of final adverse actions taken against health care providers; and

-- Makes knowing and willful transfer of assets to gain Medicaid eligibility subject to criminal penalties.

o Long-Term Care Insurance. Minimum federal consumer protection and marketing requirements are established for tax-qualified long-term care insurance policies, including a requirement that insurers start benefit payments when a policy-holder cannot perform at least two "activities of daily living" (i.e., bathing, eating, toileting, transferring, dressing, and incontinence). Subject to certain limitations, clarifies that long-term care insurance premium payments and unreimbursed long-term care services costs are tax deductible as a medical expense, and benefits received under a long-term care insurance contract are excludable from taxable income. Employer sponsored long-term care insurance is to receive the same tax treatment as health insurance.

o Medigap Insurance. Revises the notices requirement for health insurance policies that pay benefits without regard to Medicare coverage or other insurance coverage. Long-term care policies are permitted to coordinate with Medicare and other coverage and must disclose any duplication of benefits.

o Administrative Simplification. All health care providers and health plans that engage in electronic administrative and financial transactions must use a single set of national standards and identifiers. Electronic health information systems must meet security standards. This should result in more cost-effective electronic claims processing and coordination of benefits.

o Health Information Privacy. If Congress does not enact privacy legislation within three years, health care providers, health plans, and health care clearinghouses will be required to follow privacy regulations promulgated by HHS for individually identifiable electronic health information. See, S.1360, Medical Records Confidentiality Act of 1995 (a bill to ensure personal privacy with respect to medical records and health care-related information, and for other purposes).

o Viatical Insurance Settlements. A person who is within 24 months of death can have a portion of their death benefit of a life insurance policy prepaid by the issuing insurance company tax free. Such a person also is allowed to sell his or her life insurance to a viatical settlement company tax free. A chronically-ill individual can sell their life insurance and any long-term care insurance rider tax free; the proceeds of such a sale must be spent on long term care. See, SEC v. Life Partners Inc (D.C. Cir. July 5, 1996) (SEC cannot regulate viatical settlements-- investment contracts where an investor acquires an interest in the life insurance policy of a terminally ill person); More about viaticals.

o Effective Dates. The long term care insurance provisions are effective Jan. 1, 1997. The MSA provisions are effective Dec. 31, 1996. The insurance reform provisions are effective July 1, 1997.

For Immediate Release

August 21, 1996

REMARKS BY THE PRESIDENT AT THE SIGNING OF THE HEALTH INSURANCE PORTABILITY AND ACCOUNTABILITY ACT

The South Lawn

2:50 P.M. EDT

THE PRESIDENT: Thank you very much. Thank you so much.

Thank you very much for that wonderful introduction, Merit, and thank you for the courage of your example.

I want to begin by recognizing the members of Congress who are here who worked on this so hard. In addition to Senators Kassebaum and Kennedy, we have Senator John Breaux, Senator Bill Cohen, Senator Byron Dorgan, Senator Carl Levin, Congressman Mike Bilirakis, Congressman John Conyers, Congressman Harris Fawell and Congressman Dennis Hastert, Congressman David Hobson and Congressman Bill Thomas. I thank all of them for their work on this. (Applause.)

I thank Secretary Shalala for her hard work; the SBA Administrator, Phil Lader, who is here. I'd also like to recognize a gentleman in the audience who did a lot of work with the First Lady on this and who is, I'm sure, happy to be here today, our former Surgeon General, Dr. Everett Koop. Thank you, sir, for being here. (Applause.) And Dr. Henry Foster, it's nice to see you; thank you for being here, sir. (Applause.)

There are so many others I'd like to thank. I want to thank all those -- the consumer groups, the business groups, the labor groups, the grass-roots people, the people who were personally affected by health care problems and problems in our system, who are here. All of you worked so hard to make this day a reality. I want to thank all the people who worked on the staff at the White House, people especially who worked with the First Lady from 1993 on. All of you should take some great satisfaction in seeing this day come to pass, and I want you to know that I will never forget the work that all of you have done and the service you have rendered to the American people and we thank you. (Applause.)

But a lot of people who worked on health reform were just folks, people that Hillary met traveling around the country, or people that I had the good fortune to run into who told me their stories and who helped to work to make this day a reality. People like Dan Lumley, who is here with us today, a man we met on our bus tour, from Portland, Oregon. And there have been many others who have helped, like Kristin Hopper and Tensia Alvarez, who are here with their families today. We thank you for coming here with your families. And let me again especially thank Merit Kimball and her wonderful parents, Jack and Rosemary, who have come here today. They have had the courage to tell their story and to fight for their cause and on behalf of tens of millions of other Americans. They have given us the hope that together we can make things better for more Americans.

The Health Insurance Portability and Accountability Act shows what happens, as Senator Kassebaum said and Senator Kennedy said, when we work together, when we cross party lines and put the interests of the American people first. This bill is a clear boost to our values as Americans. It offers opportunity by allowing people to take their health insurance from job to job. It rewards responsibility by helping people to work who desperately want to work. It brings us together in a common community to do what's right by all of our people, saying that we ought to make it possible for more and more people to succeed at work without losing the security of knowing that when they need health care it'll be there.

Health care reform is measured by how many lives it improves. With this bill we take a long step toward the kind of health care reform our nation needs. It seals the cracks that swallow as many as 25 million Americans who can't get insurance or who fear they'll lose it. Now they're going to be protected.

Never has such a measure been more needed for our people. Our new economy presents Americans with opportunities like never before to work their way into better paying jobs. And yet our health care system has worked to paralyze many workers who fear losing their health care coverage if they take those better jobs and change their employers. At the same time, millions of Americans find themselves labeled as people with pre-existing conditions, from cancer to AIDS, which disqualifies them and their families for coverage -- including the husband, the pregnant wife -- who lose their insurance; the young woman who can't change jobs because her new insurance doesn't cover diabetes; the small business owner who faithfully pays group health insurance premiums for years and then finds that his coverage won't be renewed because one of his employees has developed a heart condition.

No more. This bill changes all that. Today we declare a victory for millions of Americans and their families. No longer will you live in fear of losing your health insurance because of the state of your health. (Applause.) No longer need you hesitate about taking a better job because you're afraid to lose your coverage. And no longer will small businesses be denied access to insurance for their employees. The Health Insurance Reform Bill I sign today will protect the health care of millions of working Americans and give them and their families something that cannot be measured -- peace of mind.

The bill also addresses other problems in getting more affordable insurance to our workers. It makes it easier and less expensive for the self-employed to purchase their insurance. As Senator Kassebaum said, it phases in a tax deduction of 80 percent for the self-employed and helps to even the playing field with bigger businesses. Second, it prevents fraud and abuse. It toughens penalties and helps us to go after bad apple health care providers who bilk the system of billions of dollars from Medicare, from Medicaid and from private insurance companies. I especially want to thank Secretary Shalala for her work on these fraud and abuse provisions.

Third, it makes the health care system more simple. It will modernize, streamline and cut the cost of insurance paperwork by devising a uniform electronic system for paying health care claims. It will provide steps to protect the privacy of people in the system as it does so. Fourth, it allows the establishment of a limited number of medical savings accounts to allow us to study this approach and see how it works, to determine whether this new approach can make a positive contribution to health care coverage and to affordability. And, fifth, it helps with long-term care. It provides consumer protections and makes long-term care insurance more affordable. This bill, in short, does a very great deal.

I want to echo what Senator Kennedy said -- Senator Kassebaum, we are deeply in your debt. We're going to miss you, and you must be very proud that here in the last months of your career in the Senate you have done such a magnificent things. We thank you so much, ma'am. (Applause.)

Senator Kennedy, as I told you before we came out here, when I woke up this morning and thought about signing this bill today, I remembered a day a very long time ago, almost 18 years ago now, when I moderated a panel on health care reform in Memphis, Tennessee, at one of our many conventions, in 1978. And you were there, telling the American people in 1978 that every person in America deserved the health care that your son had when he was first taken ill.

I'm proud of you for these two decades of commitment, sir. Thank you. (Applause.)

And if you'll forgive me a personal note, I believe, Hillary, that this justifies all those days on the road and all those nights you stayed up reading the incomprehensibly complex issues of health care. (Applause.) Thank you.

I wish this bill had contained the provision to eliminate the differential treatment of mental health coverage, or at least taken some positive steps in that direction. (Applause.) I know this is something that is especially important to Tipper Gore, and I know that we all know that we're going to have to deal with that.

And we have to do more, and this is also very important. We must find a way to provide coverage for workers and their families who are in transition. I have proposed a plan which we put in our balanced budget to cover 3 million workers and their families, including 700,000 children, who today have nowhere to turn for affordable health care because the worker is changing jobs. If a person is doing the right thing, trying to be responsible, dying to go to work, we should help those kind of people to get back on their feet without being thrown flat on their back without health insurance.

Our mission in pursuing health care reform from the start has been to provide more fairness and quality for the American people. That's why we worked to strengthen the Medicare trust fund, although we must do more and our balanced budget plan does that. That's why we've worked to preserve and protect Medicaid; why we focused on the problems of health care costs, which, thanks to efforts in the private sector, to our own efforts, and to the general direction of our economy with growth with low inflation, inflation in health care slowed to 3.9 percent in 1995, the lowest in 23 years. And for the first half of this year, it is down to less than 2 percent, and may go lower still. We must not let this be a temporary development. (Applause.)

That's also why we've worked to raise childhood immunization rates dramatically; to increase investment in biomedical research,including funding for breast cancer and AIDS; why we've expedited the FDA process in approval for new drugs, so that people who need a miracle might be able to find it; why we fought to protect our children from the harmful effects of tobacco advertising aimed at them.

But now we need to build on what we have achieved. I was encouraged to see Senator Kassebaum with her coach's mentality saying that the game is not over and we still have another month this year. And, Senator, I'm suited up and ready to play. And I appreciate you saying that. (Applause.)

This is a particularly happy day for me because, like yesterday when we signed the minimum wage bill and the bill which gave such strong incentives to small businesses to invest in their own businesses, and made it so much easier for people to adopt children who were willing to take on that profoundly important responsibility -- these two days together, and this day especially, helps ordinary Americans from the growth and progress in the American economy. America is on the right track not only when the overall numbers look good, but when from when every responsible American family can participate in that.

It's good that we have 10 million new jobs, record numbers of new businesses, that we have the lowest deficit and the highest rates of homeownership in 15 years. That's very good. But it's even better when every single American who is willing to be responsible for his or her family and his or her work can participate in those trends. And with portable health care, the minimum wage increase, additional incentives for small business growth, more pension security, moving people from welfare to work, that will help all Americans to be a part of our 21st century America.

We have more to do -- in educational opportunity, in helping people with their child care and child-rearing obligations, in helping people to buy their first home -- in finishing the job of balancing the budget so that we can keep interest rates down and inflation down. But we are clearly moving on the right track.

I look forward to working with Congress when they come back inSeptember and to continuing this effort. I want to say again, this bill passed almost unanimously. This is a bill that both Senators Kennedy and Kassebaum can be proud of because they brought all their colleagues along with them. This is a bill that people who have been working in the House for years and years and years on health care reform can be proud of, and so can everybody else who showed up and voted for it. And, Congressman Hastert, I want to echo what Senator Kassebaum said -- we appreciate your work and we know how much you did to get those last few difficult issues resolved in a way that we could all live with.

We can do things when we work together and put the American people first. And whenever we work on behalf of our families and our children, as we do with the Health Insurance Portability and Accountability Act, America always wins.

So, now, in the names of the families and children who will have better lives because of it, I am honored to sign this profoundly important piece of legislation. And I'd like to ask the members of Congress to come up and join me, along with the families who are here. Thank you very much, and God bless you. (Applause.)

(The bill is signed.) (Applause.)

For Immediate Release

August 21, 1996

STATEMENT BY THE PRESIDENT

I am pleased to sign into law H.R. 3103, the "Health Insurance Portability and Accountability Act of 1996." For the first time, this Act will ensure the portability of health benefits when workers change or lose their jobs and will protect workers against discrimination by health plans based on their health status.

For too long, tens of millions of Americans have been denied health insurance coverage because they have preexisting conditions. We have all heard their stories.

-- A husband and his pregnant wife lose their insurance and then find they cannot buy new coverage because her pregnancy is considered a preexisting condition.

-- A young woman starting out in her career cannot accept a promotion with another company because its health insurance policy won't cover her diabetes.

-- A small business owner faithfully pays his group health insurance premiums for years only to learn that his coverage won't be renewed after one of his employees develops a heart condition.

Since taking office, I have been fighting for changes that would stop this kind of unfairness and make health insurance more accessible for all people, including the most needy. I am pleased that the Congress has responded to my call. In passing this Act, a modest but important step has been taken to improve Americans' access to health care coverage.

This legislation will set into motion several key reforms. First, it will eliminate the possibility that individuals can be denied coverage because they have a preexisting medical condition. Second, it will require insurance companies to sell coverage to small employer groups and to individuals who lose group coverage without regard to their health risk status. Finally, it will require insurers to renew the policies they sell to groups and individuals.

In addition to the health insurance reforms, this legislation will help strengthen other aspects of our health care system.

-- It increases the tax deductibility of health insurance premiums for the self-employed and their dependents from 30 percent to 80 percent by calendar year 2006.

-- It significantly expands Federal authority and resources to combat fraud and abuse in Federal health programs, such as Medicare, and in the private sector.

-- It provides for the development of: (1) national standards for the electronic submission of health insurance claims that will reduce paperwork, administrative costs, and burdens for doctors and hospitals; and (2) privacy protection recommendations for health information generally, and, in the absence of additional legislation, regulations for privacy of health care claims information.

-- It establishes consumer protection standards for certain long-term care insurance policies and provides tax clarifications to make those policies more affordable and available.

Like most legislation, this Act includes compromises that are less than perfect. For example, it includes a provision that will allow a limited number of individuals covered by catastrophic health insurance to establish tax-advantaged medical savings accounts, or MSAs. I opposed an open-ended, unconstrained expansion of MSAs because of my concern that MSAs may create incentives for healthier people to select catastrophic health coverage, which experts believe would increase premiums for those who choose traditional, comprehensive health care policies. I agreed, however, to work with the Congress in crafting a compromise that would permit the establishment of a limited number of MSAs. This limited use of MSAs will be studied carefully for a period of 4 years before deciding whether or not to expand them to the broader health insurance market, and the Congress will have to consider this issue and vote again before doing so.

Similarly, while the bill makes some of the positive changes that I have proposed to strengthen our efforts to combat health care fraud and abuse, I am concerned that it also contains a provision that could weaken those efforts. I oppose the requirement that Government officials provide advisory opinions on whether certain arrangements violate criminal health fraud statutes. The Attorney General and the Secretary of Health and Human Services are concerned that advisory opinions of this nature could create complexities that would burden the efforts to enforce laws against health care fraud and abuse. Therefore, I am directing the Departments of Justice and Health and Human Services to work closely together in implementing this provision to ensure that it promotes and protects Federal law enforcement activities relating to health care fraud.

Finally, I want to reiterate my disappointment that the Congress dropped from this legislation the mental health parity provision that received such bipartisan support in the Senate. Individuals with mental illness have long suffered from discrimination in health plans that impose severe financial burdens on top of the illnesses they already face. I urge the Congress to act at the earliest opportunity to require parity in health insurance coverage for mental health services. I look forward to working with the Congress to address this critical issue.

As I sign this legislation, I am particularly grateful to Senators Kassebaum and Kennedy and the many other Members of Congress who worked tirelessly to assure that this bill is a meaningful and important step toward making health care more accessible and more secure for millions of Americans. I pledge to continue this effort and hope that the Congress will work with me and so that all Americans can have health care security.

WILLIAM J. CLINTON

THE WHITE HOUSE,

August 21, 1996.

For Immediate Release

August 21, 1996

PRESS BRIEFING BY MIKE MCCURRY

The Briefing Room

1:23 P.M. EDT

MR. MCCURRY: What do you guys want to talk about today?

[...]

Q Mr. Barbour said this morning that the bill being signed this afternoon is one Mr. Clinton has opposed all along and pretended not to have. Is Mr. Barbour correct in that, and if not --

MR. MCCURRY: No, he must just be in a kind of a daze ofconfusing after his convention. So when he gets his feet back on the ground maybe he'll be a reliable commentator on policy.

The President -- one thing I think everyone understands is his deep commitment to health care reform. He wrote a letter to Speaker Gingrich and to then Majority Leader Dole in December of 1994, encouraging the Congress to take step-by-step measures that would move us along the road to health care reform and, certainly, this is a very positive step. This is an important measure in terms of portability. The President will describe the reasons why the bill is a good one and a good start on the types of things we need to do.

The President does have other proposals, as well. In his budget is a funding measure to help unemployed people have some assistance to maintain health care coverage. And this is a problem that the President plans to continue working on and a reason why the President hopes that he might have four more years to continue the progress that we see today with this signing.

Q Mike, the President did at one time, however, in the State of the Union address under different political circumstances indicate he would not accept any kind of a piecemeal, step-by-step approach to health care reform. Would it be fair to characterize the change on that as one made at the end of 1994 as an accommodation to the new political realities?

MR. MCCURRY: That's fair to say. I think it's important also to note that in his most recent State of the Union address, the one this past January, he specifically encouraged Congress to move forward on the Kassebaum-Kennedy legislation. In fact, Senator Kennedy credited the President with a very important jolt of momentum by making that public appeal.

Q Is it fair to say, though, that it was simply an adjustment to new political reality that caused him to change his mind about it?

MR. MCCURRY: I think it's an adjustment to the reality that we were facing a Republican Congress. The President desired to continue working on health care reform and that this was the way in which it was most likely that we would achieve the success that the President will celebrate with a bipartisan group of members of Congress today.

Q There was a concern expressed at the time, expressed by him and by the First Lady, that in important respects partial reform of this kind was worse than none because of the balances required in the system and so forth. What changed his mind on the substance of the issue?

MR. MCCURRY: Well, they have done things in this bill with respect to portability, with administrative reforms that will strengthen the health care system. It's leaving unaddressed several major problems. First of all, dropped from this bill was a mental health parity measure that the President was concerned about, but, most important, the lack of coverage for those who are uninsured remains a critical problem that will need to be addressed. And the President will never lose sight of the objective of continuing to work on ways in which we can cover those who are not uncovered.

Q Will there be a proposal to that effect between now and the end of the year, or early next year sometime if he's reelected?

MR. MCCURRY: Not likely, although, as I said, we do have a proposal that would expand access to health care insurance by addressing the needs of those who are uninsured in periods in which they're unemployed. Now, that's the kind of thing that we believe we can work on. Again, it's consistent with what the President had outlined to the Republican leaders in December of 1994, an incremental approach that would allow us to continue to work on health care reform.

Q Mike, there's also concern within the industry, the insurance industry, and among some of the consumer groups, that without some kind of caps that this portability could, in fact, drive up not only insurance costs, but premiums. Is the President prepared to try to pursue that at some point?

MR. MCCURRY: There are always those kinds of complaints from the private sector and this administration certainly knows how the private sector addresses some of those types of contemplated changes in the health care insurance system.

It's also true that having access to health care during periods of transition might increase worker productivity, and it might make either for a more stable work force or a more fluid work force, thus helping the private sector remain efficient and competitive. I mean, there are lots of different ways to measure the effects of that.

What we have pledged to do is to make sure we address the concerns raised by the private sector. That, indeed, has been done in the course of working on this legislation. And we will continue, as we continue the process of reforming health care in the United States, to take into account the needs of the provider community, the insurance community, certainly the private sector that provides the bulk of health care insurance for the American people through employer-provided health care benefits.

Q So, at this point, is it a cart before the horse kind of thing, until it's actually determined what effect this has on premium costs or health insurance costs for either individuals or companies?

MR. MCCURRY: Well, there are specific provisions in here that we think, in fact, are going to ease health care cost increases because of the ease of administration, some of the standardization measures they're doing in terms of making claims. We think this bill is one that improves the provision of health care, improves the confidence the American people will have in health care insurance when they need it -- in that sense, lend stability that we believe over time has a deinflating factor in the sector.

Q Is the President working on a plan to ease access to the home mortgage interest deduction, or will that be part of the --one of the proposals he announces on his way to or at the convention?

MR. MCCURRY: As I said yesterday, we are looking to make news next week, and if I say so now it won't be news then.

Q Mike, there are 50 or 100 people outside protesting the fact that mental health coverage was dropped from the bill. Does the President have a plan, a proposal of his own to make to try and deal with that?

MR. MCCURRY: Well, we had an important plan, in that sense. It was the Domenici-Wellstone provision that was in this. But we've heard -- the group that's outside is one that we've had correspondence with. In fact, they wrote to him advising him they would be out there today to continue to hold before the Congress the need to address the concerns of those who are mentally ill and who need coverage.

Q How come they're demonstrating here and not down on the Hill then?

MR. MCCURRY: That's because you're here and not on the Hill. Nobody on the Hill today. They want to attract -- I can quote from the letter -- they applauded the President's work on this; they sent him congratulations for this incremental step forward and the letter that they have sent to the President is signed "with deepest respect" by the executive director of the organization.