the conventional wisdom is that health care is in trouble. i think the conventional wisdom is almost entirely wrong. he's got the vote in the house for something close to what he wants. that is a public option. the subss for people to buy the inshoourns. and max baucus is promising to move the bill through the committee for a couple of weeks. you're going to see action after that. it's an open question whether democrats can get 60 votes to get past a filibuster, but thing their chance is reasonably good, especially since olympia snow remains one of the key architects of what the senate finance committee is going to do. so i think to the extent that the market has decided obama was unlikely to achieve his goal, i think most of that is wrong and that so bama has a very good chance to come out this year in november, perhaps early december and have a bill embody nearly everything he wants to accomplish.

>> let me bring in betsy mccoy and let me bring in mr. goodfriend. bob dole for stock market perspective. betsy mccoy, i talked to a bunch of senators this evening. actually, we hit 7% of the senate. i heard a lot of skepticism about the entire plan, skepticism from democrat mark warner, skepticism from democrat evan bayh. skepticism from democrat ron widen, skepticism from susan collins, republican. and of course tougher skepticism from lamar alexander and judd gregg. betsy, how do you read this? is this going to be as easy or at least as promising as john harwood is suggesting? >> well, of course, the president has to calm the fears of two groups of americans. one is seniors. he's already admitted to them that this legislation will be paid for by a $500 billion cut in future medicare spending over the next decade, about a 10% cut

when 30% more people will be in the program. those numbers just don't add up. and seniors are worried about fewer hip replacements, et cetera. and he also has to calm the fears of americans who already have health plans they like. because the legislation says they will have to move into what's called a qualified plan. and the health choices commissioner yet to be appointed will decide what that covers, how much it will cost, how much people will have to pay, and how much leeway their doctors will have under these plans to give them the care they need. >> the american public is just worried that expanding $50 million uninsured, expandi inin requirements for insurance companies. the numbers don't add up. how do you react to that? >> it doesn't make for good television, but we ought to talk about what everybody does agree with.

it's not right for an insurance company to deny coverage based on a pre-existing condition. you can't find somebody who will stand up and disagree with that. businesses and individuals know you need relief. john harwood reported that 5 out of 5 committees have reported out a bill or said they're going to report out a bill in the case of the last, five the finance committee. >> all right, betsy mccoy. fourth and goal is an interesting football analogy. the cost structure comes in and there's the beautiful first lady, michelle obama, god bless her.

your point in the editorial that you wrote in the "new york post." apply $100 million to the chronically uninsured, could you briefly expand on that? >> that's right, the 46 million underinsured you hear about, there are actually 10 million americans who don't earn enough to buy health insurance or can't get it because of pre-existing conditions. and they could be covered literally for the next decade by spending the $500 billion in stimulus money that's just sitting tlp. it would prevent cuts in medicare. it would mean that people who have health plans they like would not have to change. it's a sensible, modest step to reach out to those who need our help most urgently. >> robert dahl, if i could just

bring you in briefly. what about the financing issue, the possibility of a trillion dollars in new spending and new borrowing, bob dole. imminent economist from harvard says when you look at the whole program, it's a $2 trillion add-on. bob dole is this a market-moving issue? >> yeah, trillions do make a difference, larry. as you point out, i think we have to be concerned about it. beyond that, what's the president going to do for other things? cap and trade? what's he going to do for financial reform? getting health care doin done will have a lot to do if he has the political muscle to get those things done. >> i need you to respond to those market issues. you know, sometimes the road to fiscal ruin is paved by good intentions, david. >> look at the growth in medicare and health care costs. what do you think killed gm and

chrysler. part of it was the health care expenditures that they could not match. >> what do we do about that? >> tell you what you do about it. a couple of things. first of all, whenever the finance committee proposal has by and large gotten the blessing from the congressional budget office that it would not add to the deficit, and secondly, that it has elements within it, including the kerry plan to attack high-value insurance plans that the cbo believes would have the effect of bending the cost curve in the long run. >> but john harwood, the state of very significant tax increases, including the so-called high value business insurance plans that big labor may imimpose. what's the economic impact? >> one would be bending the cost curve. the second thing is some of those businesses would not like it, would get hit. you may have some democrats, juk schumer in new york seeing some

of his high cost insurance beneficiaries. firefighters and police department and many in the financial industry would get hit. medical device manufacturers would get hit. pharmaceutical companies would get hit. but the president has made the decision he wants a package that would raise $300 billion in revenue. this is what max baucus has been working on. shepard that was secoretary of state hillary clinton. that's rahm emanuel walking down. the increases coming out of the senate finance plan from the democrat of montana, max baucus. seems like rough going for americans in general and the economy in general. >> it will be, but furthermore, when the president or members of the senate call for slowing the growth in health care spending, that's also going to mean cuts in hospital budgets.

it's going to mean less nurses on the floor, less mri equipment, longer waits for treatments and it's going to mean layoffs, larry, because health care is the largest employer in the u.s. ten times the workforce of chrysler and gm. we have to remember that health care is part of the denominator. you know, i come from new york, which was just mentioned a moment ago. over 30% of the workforce in places like brooklyn and bronx, new york, are in health care. and that's going to mean huge job cuts if a bill that reduces the growth in health care spending by government controls is passed. >> let me ask you, as larry said there, it's fourth and goal and betsy is blitzing, betsy, my question is, what would you do about costs? in other words, you're -- i think you're correct. there are cuts contemplated from some of these cost reduction measure, but do you not agree that for the sake of businesses and the economy as a whole, costs do need to come down? >> well, the third party payer

costs need to come down. we need a system that will allow people to buy some of their health care themselves and get some through the government or through their employer. but that's very different from putting government controls that actually limit the amount of health care you can get. >> where are you getting that? >> dave, it's an interesting side point but an important one that betsy raised. health care has 13.7 million jobs. i think it's the third largest employer in the united states, even in the past year, david. health care created another 400,000 jobs. 6 million jobs overall in this terrible recession. do you worry that allment taxes discussed in the baucus plan and elsewhere will do grave damage to this america's perhaps best growing industry, namely health care? >> it's very interesting to note what betsy mentioned. she did not -- she did not

mention the health insurance companies. and their profit margins and their bonuses and executive compensation packages are way out of line with the value they provide into that health care system and the jobs. i do not shed a tear. i am not picking up a piece of kleenex to dab my eyes for the losses to the health insurance industry for the insurance companies if this passes. >> i'm not a fan of the health insurance either. but hospitals in new york are already sending memos around to their staff warning that this legislation will mean cuts, and an environment of medical scarcity. it will be harder to provide care. >> larry kudlow, you now have it framed. it's the catch-22 of the republican party. please keep down costs but please, no government intervention. you can't have it both ways. you want costs cut, so do i.

guess what? government's got to get tough on some of these companies that have been feathering their own nests at the cost to consumers. >> first of all, president obama is running late. he's running over four minutes late. we are going to pick it up just as soon as he appears inside the chamber of the house of representatives. we're waiting on that. i have no doubt that the government is going to spend some money on the 10 million or 12 million chronically uninsured. those who are, in fact, american citizens who need help. i have no doubt about that. in fact, secondly -- >> why 10 million to 12 million, larry? >> that's what the census calls for when you break it down. ild like you to respond, david. why do we need to go large at this point. there's a lot of double counting in the so-called 47 million underinsured. is this time to go small ball or large ball? >> first of all, as john harwood was alluding to, i think your

numbers are off. if you take out illegal immigrants, you still have 30 million that are uninsured. if you expand the risk pool as senator widen said, that's key. you absolutely require people to buy into insurance. senator olympia snowe reports that. senator collins mentioned it on the show. when you do that, you bring costs down for everybody, and that's actually one area where democrats and republicans agree. >> the president is about to enter into the chamber. i think the best thing we can do is let them take over. >> the president of the united states!

[ applause ] >> there you can see president obama making his way. he's going to take a few minutes. he's going to enjoy the applause and shake a lot of hands as you probably noticed. that's republican leader mitch mcconnell. senator majority leader harry reid is right behind him. mr. obama will work the aisles as presidents always do. george w. bush loved working the aisles and basking in the adulation. there's no reason why president obama shouldn't operate the same way. in front of him, of course, is the sergeant of arms who

announced his coming into the chamber. let us just watch some more. you may recognize some of the faces and maybe your own congressman or congresswoman. let's just listen to the applause and the adulation as the president makes his way to the podium. . >> that's congressman wexler of florida you just saw. this is, of course, a hugely important speech for mr. obama. he called it himself for a special joint session. he requested it about a week ago. his health care plan has had a difficult summer. declining polls would suggest that among independents and seniors. of course, the town hall

meetings, controversial as they are did stir the pot for more unrest. people are asking many, many different questions. not only about the health care plan itself, but ant whether president obama can make the sale, can he explain the details, will he be able to communicate both style and substance to the american people this evening? this is a very significant, maybe the most important test of his very young presidency. it is for the moment at least overcoming fears about the economic and stimulus package. it's also looming much larger right now than issues overseas in iraq and especially afghanistan. and perhaps iraq. mr. obama was in new york today at the united nations, but now the whole nation will be turned to the number one domestic and national issue, which is a possible health care reform. how large, how much impact taxing, spending, borrowing, help for the uninsured, help for

the sick, help for those with preconditions, and whether we can get our arms around this, as mr. obama has said himself. presidents for 50 years having talking about health care reform. here is the president, let us listen. [ applause ] >> thank you. thank you.

members of congress, i have the high privilege and distinct honor to present to you the president of the united states. . >> thank you. thank you. thank you so much. thank you. thank you. thank you very much. thank you very much. thank you. please, have a seat. thank you. thank you very much.

please, be seated. madam speaker, vice president biden, members of congress, and the american people, when i spoke here last winter, this nation was facing the worst economic crisis since the great depression. we were losing an average of 700,000 jobs per month. credit was frozen and our financial system was on the verge of collapse. as any american who is still looking for work or a way to pay their bills will tell you, we are by no means out of the woods. a full and vibrant recovery is still many months away. and i will not let up until those americans who seek jobs can find them.

[ applause ] until those businesses that see capital and credit can thrive, until all responsible homeowners can stay in their homes, that is our ultimate goal. but thanks to the bold and decisive action we've taken since january, i can stand here with confidence and say that we have pulled this economy back from the brink. [ applause ] now, i want to thank the members

of this body for your efforts and for your support these last several months and especially those who have taken the difficult votes that have put us on the path to recovery. i also want to thank the american people for their patience and their resolve during this trying time for our nation. but we did not come here just to clean up crises. we came here to build a future. so -- so tonight, i return to speak to all of you about an issue that is central to that future. and that is the issue of health care. i am not the first president to take up this cause, but i am determined to be the last. [ applause ]

it has now been nearly a century since theodore roosevelt first called for health care reform. and ever since, nearly every president and congress, whether democrat or republican has attempted to meet this challenge in some way. a bill for comprehensive health reform was first introduced by john dingell sr. in 1943. 65 years later, his son continues to introduce that same bill at the beginning of each session. oir collective failure to meet this challenge year after year, decade after decade has led us to the breaking point. everyone understands the

extraordinary hardships that are placed on the uninsured who live every day just one accident or ill ansneness away from bankrup. these are not primarily people on welfare, these are middle class americans. some can't get insurance on the job. others are self-employed and can't afford it since buying you insurance on your own costs three times as much as getting insurance from your employer. many others who are willing and able to pay are still denied insurance due to preconditions that insurance companies decide are too risky or too expensive to cover. we are the only democracy, the only advanced democracy on earth, the only wealthy nation that allows such hardship for mani manies of -- millions of its people. in just a two-year period, one in every three americans goes

without health care coverage at some point. and every day, 14,000 americans lose their coverage. in other words, it can happen to anyone. but the problem that plagues the health care system is not just a problem for the uninsured. those who do have insurance have never had less security and stability than they do today. more and more americans worry if you lose your job or change your job you'll lose your health insurance, too. more and more americans pay their premiums only to discover their insurance company drops their coverage when they get sick. one man from illinois lost his coverage in the middle of chemotherapy because his insurer found he hadn't reported gallstones that he didn't even know about. they delayed his treatment and he died because of it. another woman from texas was about to get a double mastectomy

when her insurance company denied her her because she forgot to report a case of acne. by the time she was reinsured, her cancer had doubled in size. that is heart breaking, it is wrong and no one should be treated that way in the united states of america. [ applause ] then there's the problem of rising costs. we spend 1 1/2 times more per person on health care than anyone else on health care, but we're not any healthier for it. one of the reasons insurance

premiums have gone up three times faster than wages. it's why so many employers, especially small businesses are forcing their employees to pay more for insurance or are dropping their coverage entirely. it's why so many inspiring entrepreneurs cannot afford to open up a business in the first place, and why american businesses that compete internationally, like our automakers, are at a huge disadvantage. and it's why those of us with health insurance are also paying a hidden and growing tax for those without it. about $1,000 per year that pays for somebody else's emergency room and charitable care. finally, our health care system is placing an unsustainable burden on taxpayers. when health care costs grow at the rate they have, it puts greater pressure on programs like medicare and medicaid. if we do nothing to slow these skyrocketing costs, we will eventually be spending more on medicare and medicaid than every other government program combined.

put simply, our health care problem is our deficit problem. nothing else even comes close. nothing else. [ applause ] now, these are the facts. nobody disputes them. we know we must reform this system. the question is how. now, there are those on the left who believe the only way to fix the system is through a single-payer system like canada's. [ applause ] where we would severely restrict the private insurance market and have the government provide insurance for everybody. on the right, there are those who argue we should end employer-based systems and leave individuals to buy insurance on their own.

i have to say that there are arguments to be made for both those approaches. but either one would represent a radical shift that would bankrupt the health care most people currently have. since health care represents 1/6 of our economy, i believe it makes more sense to build on what works and fix what doesn't. rather than try to build an entirely new system from scratch. [ applause ] and that is precisely what you in congress have tried to do over the past several months. during that time we've seen washington at its best and at its worst. we've seen many in this chamber work tirelessly for the better part of this year to offer

thoughtful ideas about how to achieve reform. of the five committees asked to develop bills, four have completed their work and the senate finance committee announced today that it will move forward next week. that has never happened before. our overall efforts have been supported by an unprecedented coalition of doctors and nurses, hospitals, seniors groups, and even drug companies, many of whom opposed reform in the past. and there is agreement in this chamber on about 80% of what needs to be done. putting us closer to the goal of reform than we have ever been. but what we've also seen in these last months is the same partisan spectacle that only hardens the disdain many americans have towards their own government. instead of honest debate we've seen scare tactics. some have dug in to unyielding

ideological camps that offered no hope of compromise. too many have used this as an opportunity to score short-term political points, even if it robs the country of our opportunity to solve a long-term challenge. and out of this blizzard of charges and countercharges, confusion has rained. well, the time for big bickering is over. the time for games has passed. now is the season for action. now is when we must bring the best ideas of both parties together and show the american people that we can still do what we were sent here to do. now is the time to deliver on health care. now is the time to deliver on health care. the plan i'm announcing tonight would meet three basic goals. it will provide more security and stability to those who have health insurance.

it will provide insurance for those who don't. and it will slow the growth of health care costs for families, our businesses and our government. [ applause ] it is a plan that asks everyone to take responsibility for meeting this challenge. not just government, not just insurance companies, but everybody, including employers and individuals. and it's a plan that incorporated ideas from senators and congressmen. from democrats and republicans. and yes, from some of my opponents in both the primary and general election. here are the details that every american needs to know about this plan. first, if you are among the hundreds of millions of americans who already have health insurance through your job or medicare or medicaid or the v.a., nothing in this plan will require you or your

employer to change the coverage or the doctor you have. nothing in this plan will require you to change what you have. what this plan will do is make the insurance you have better for you. it makes it illegal for insurance companies to deny you because of a pre-existing condition. [ applause ] as soon as i sign the bill, it will be against the law for insurance companies to drop your coverage when you get sick, or water it down when you need it the most.

[ applause ] they will no longer be able to place some arbitrary cap on the amount of coverage you can receive in a given year or a lifetime. [ applause ] we will place a limit on how much you can be charged for out of pocket expense, because in the united states of america, no one should go broke because they get sick. [ applause ] and insurance companies will be required to cover, at no extra charge, routine check-ups and preventive care like mammograms and colonoscopies because there's no reason we shouldn't

be catching diseases like breast cancer and colon cancer before they get worse. that makes sense, it saves money and it saves lives. now, that's what americans who have health insurance can expect from this plan -- more security and more stability. now, if you're one of the tens of millions of americans who don't currently have health insurance, the second part of this plan will finally offer you quality affordable choices. if you -- if you lose your job or you change your job, you'll be able to get coverage. if you strikeout on your own and start a small business, you'll be able to get coverage. we'll do this by creating a new insurance exchange, a marketplace where individuals and small businesses will be able to shop for health insurance at competitive prices.

insurance companies will have an incentive to participate in this exchange because it lets them compete for millions of new customers. as one big group, these customers will have greater leverage to bargain with the insurance companies for better prices and quality coverage. this is how large companies and government employees get affordable insurance. it's how everyone in this congress gets affordable insurance, and it's time to give every american the same opportunity that we give ourselves. [ applause ] now for those individuals and small businesses who still can't afford the lower priced insurance available in the exchange will provide tax credits, the size of which will be based on your need. and all insurance that want access to this new marketplace will have to abide by the

consumer protections i already mentioned. this exchange will take effect in four year, which will give us time to do it right. in the meantime, for those americans who can't get insurance today because they have pre-existing medical conditions, we will immediately offer low-cost coverage that will protect you against financial ruin if you become seriously ill. this was a good idea when senator john mccain proposed it in the campaign, it's a good idea now and we should all embrace it. [ applause ] now, even if we provide these affordable options, there may be those, especially the young and the healthy who still want to take the risk and go without

coverage. there may still be companies that refuse to do right by their workers, by giving them coverage. the problem is such irresponsible behavior costs all the rest of us money. if there are affordable options and people still don't sign up for health insurance, it means we pay for these people's expensive emergency room visits. if some businesses don't provide workers health care, it forces the rest of us to pick up the tab when their workers get sick and gives those businesses an unfair vance advantage over their competitors. and unless everybody does their part, many of the insurance reforms we seek, especially requiring insurance companies to cover pre-existing conditions just can't be achieved. and that's why under my plan individuals will be required to carry basic health insurance, just as most states require you to carry auto insurance.

like wise, businesses will either offer their workers health care or chip in to help cover the cost of their workers. there will be a hardship waiver for those individuals who still can't afford coverage, and 95% of all small businesses because of their size and their profit margin would be exempt from these requirements. but we can't have large businesses and individuals who can afford coverage gain the system by avoiding responsibility to themselves and their employees. improving the health care system only works if everybody does their part. and while there remains some significant details to be ironed o out, i believe a broad consensus exists for the aspects of the plan i just outlined. consumer protections for those with insurance, an exchange that allows individuals and small

businesses to purchase affordable coverage, and a requirement that people who can afford insurance get insurance. and i have no doubt that these reforms would greatly benefit americans from all walks of life. as well as the economy as a whole. still, given all the misinformation that's been spread over the past few months, i realize -- i realize that many americans have grown nervous about reform. so tonight i want to address some of the key controversies that are still out there. some of people's concerns have grown out of bogus claims, spread by those whose only agenda is to kill reform at any cost. the best example is the claim, made not just by radio and cable talk show hosts but by prominent politicians that we plan to set up panel of bureaucrats with the power to kill off senior citizens.

now, such a charge would be laughable if it weren't so cynical and irresponsible. it is a lie, plain and simple. [ applause ] [ applause ] now, there are also those who claim our reform efforts would insure illegal immigrants. this, too, is false. the reforms i'm proposing would not apply to those here illegally. >> that's a lie! [ booing ] >> that's not true. and one more misunderstanding i want to clear up under our plan

more federal dollars will be used to fund abortions athose laws will remain in place. now, i've been attacked by some who oppose reform as a government takeover of the entire health care system. as proof, critics point to a part of the plan that allows small businesses to choose a publicly sponsored insurance option just like medicaid or medicare. so let me set the record straight here. my guiding principle is and always has been that consumers do better when there's choice in competition. that's how the market works.

[ applause ] unfortunately in 34 states, 75% of the insurance market is controlled by five or fewer companies. in alabama almost 90% is controlled by just one company. without competition the price of insurance goes up and quality goes down. and it makes it easier for insurance companies to treat their customers badly by cherry picking the healthiest individuals and trying to drop the sickest. by overcharging small businesses who no leverage, and by jacking up rates. insurance executives don't this because they're bad people. they do it because it's profitable. as one former insurance executive testified before congress, insurance companies are not only encouraged to find

reasons to drop the seriously ill, they are rewarded for it. all of this is in service of meeting what this former executive called wall street's relentless profit expectations. now, i have no interest in putting insurance companies out of business. they provide a legitimate business and employ many people. i just want to hold them accountable. [ applause ] and the insurance reforms i've already mentioned would do just that. but an additional step we can take to keep insurance companies honest is by making a not for profit public option available in the insurance exchange.

[ applause ] let me be clear. it would only be an option for those who don't have insurance. no one would be forced to choose it. and it would not impact those of you who already have insurance. in fact, based on congressional budget office estimates, we believe that less than 5% of americans would sign up. despite all this, the insurance companies and their allies don't like this idea. they argue that these private companies can't fairly compete with the government. and they would be right, if taxpayers were subsidizing this public insurance option, but they won't be. i've insisted that like any private insurance company, the public insurance option would have to be self-sufficient and rely on premiums it collects. but by avoiding some of the

overhead that gets eaten up at private companies by profits and excessive administrative costs and executive salaries, it could provide a good deal for consumers. and it would also keep pressure on private insurers to keep their policies affordable and treat their customers better, the same way public colleges and universities provide additional choice and competition to students, without in any way inhibiting a system of private colleges and universities. [ applause ] >> it is worth noting a strong ma jor city of americans still favor the kind of reform i've outlined. but its impact shouldn't be exaggerated by the left, the right or the media. it is only one part of my plan

and shouldn't be used as a handy excuse for the usual washington ideological battles. to my progressive friends, i would remind you that for decades, the driving idea behind reform is to end insurance company abuses and make coverage available for those without it. the public option is only a means to that end. and we should remain open to other ideas that accomplish our ultimate goal. and to my republican friends, i say that rather than making wild claims about a government takeover of health care, we should work together to address any legitimate concerns you may have. [ applause ] for example, some have suggested that the public option go into

effect only in those markets where insurance companies are not providing affordable policies. others have proposed a co-op or another nonprofit entity to administer the plan. these are all constructive ideas worth exploring. but i will not back down on the basic principle that if americans can't find affordable coverage, we will provide you with a choice. [ applause ] and i will make sure that no government bureaucrat or insurance company bureaucrat gets between you and the care that you need [ applause ]

finally, let me discuss an issue that's of great concern to me, the members of this chamber and the public. and that's how we pay for this plan. first,ly not sign a plan that adds one dime to our deficits, either now or in the future. [ applause ] i will not sign it if it adds one dime to the deficit now or in the future, period. and to prove that i'm serious, there will be a provision in this plan that requires us to come forward with more spending cuts if the savings we promise don't materialize. [ applause ]

now, part of the reasons i faced a trillion dollar deficit when i walked into the doors of the white house because too many initiatives over the last decade were not paid for, from the iraq war to the tax breaks for the wealthy. [ applause ] i will not make that same mistamista mistake with health care. second, we've estimated that most of this plan can be paid for by finding savings within the existing health care system, a system that is currently full of waste and abuse. right now, too much of the hard earned savings and tax dollars we spend on health care don't make us any healthier. that that's not my judgment. it's the judgment of medical professionals across the country. and this is also true when it comes to medicare and medicaid.

in fact, i want to speak directly to seniors for a moment, because medicare is another issue that's been subjected to demagoguery and distortion during the course of this debate. more than four decades ago this nation stood up for the principle that after a lifetime of hard work, our seniors should not be left to struggle with a pile of medical bills in their later years. that's how medicare was born. and it remains a sacred trust that must be passed down from one generation to the next. [ applause ] and that is why not a dollar of the medicare trust fund will be used to pay for this plan. [ applause ] the only thing this plan would eliminate is the hundreds of billions of dollars of waste and fraud, as well as unwarranted

subsidies in medicare that go to insurance companies. subsidies that do everything to pad their profits but don't improve the care of seniors. and we will also create an independent commission of doctors and medical experts charged with identifying more waste in the years ahead. [ applause ] now, these steps will ensure that you, america's seniors, get the benefits you've been promised. it will ensure that medicare is there for future generations. and we can use some of the savings to fill the gap in coverage that forces too many seniors to pay thousands of dollars a year out of their own pockets for prescription drugs. [ applause ]

that's what this plan will do for you. so don't pay attention to the scary stories about how your benefits will be cut. especially since some of the same folks who are spreading these tall tales have fought against medicare in the past an have turned medicare into a private voucher program. that will not happen on my watch. i will protect medicare. now because medicare is such a big part of the health care system, making the program more efficient can help us ensure changes we deliver health care that can reduce costs for everybody. we have long known that some places like the intermountain health care in utah or the

health care system in rural pennsylvania offer high quality care at below average. so the commission can help encourage the adoption of the common sense best practices by doctors and medical professionals throughout the system. everything from reducing hospital inpecks rates to enk encourage better coordination between doctors. now much of the rest would be paid for with revenues from the very same drug insurance companies that stand fwoen fit from tens of millions of new customers. this reform will charge insurance companies a fee for their most expensive policies which will encourage them to provide greater value for the money. an idea which has the is pot of democratic and republican experts and according to these same experts, this modest change could help hold down the cost of

health care for all of us in the long run. finally, many in this chamber, particularly on the republican side of the aisle, have long insisted reforming our medical malpractice laws can help bring down the costs of health care. now -- [ applause ] there you go. there you go. now i don't believe malpractice reform is a silver bullet. but i talked to enough doctors to know that defensive medicine may be contributing to unnecessary costs. so -- so i'm proposing we move forward or a range of ideas

about how to put patients' safety first and let doctors focus on practicing medicine. i know -- i know that the bush administration considered authorizing demonstration projects in individual states to test these ideas. i think it is a good idea. and i'm directing my secretary of health and human services to move forward on this initiative today. add it all up and the plan i'm proposing will cost around $900 billion over ten years. less than we have spent on the iraq and afghanistan wars and less than the tax cuts for the wealthiest few americans congress passed in the previous administration. [ applause ] now -- most of these costs will

be paid for with money already being spent. but spent badly in the existing health care system. the plan will not add to our deficit. the middle class will realize greater security. not higher taxes. and if we are able to slow if growth of health care costs by just .1 of 1% each year, it will actually reduce the deficit by $4 trillion over the long term. now this is the plan i'm proposing. it is plan that incorporates ideas for many of the people in this room tonight. democrats and republicans. i will continue to seek common ground in the weeks ahead. if you come to me with a serious set of proposals, i will be there to listen. my door is always open.

but know this. i will not waste time with those who have made the calculation that it is better politics to kill this plan than to improve it. [ applause ] i won't stand by while the special interests do the same old tactics to keep things exactly the way they are. if you misrepresent what's in this plan, we will call you out. and i will not -- i will not accept the status quo as a solution. not this time. not now. everybody in this room knows what will happen if we do nothing. our deficit will grow and more

families will go bankrupt and more businesses will close. more americans will lose their coverage when they aric and need it the most. and more will die as a result. we know these things to be true. that is why we cannot fail. because there are too many americans counting on us to succeed. the ones that suffer silently and the ones who share their stories with us at town halls and e-mails and letters. i received one of those letters a few days ago. it was from our beloved friend and colleague, ted kennedy. he had written it back in may shortly after he was told his illness was terminal. he asked for it to be delivered upon his death. in it he spoke about what a happy time his last months were. thanks to the love and support

of family and friends and his wife vickie and his amazing children who are all here tonight. and he expressed confidence that this would be the year that health care reform, that great unfinished business of our society, he called it, would finally pass. he repeated the truth that health care is decisive for our future prosperity but reminded me that it concerns more than material things. what we face, he wrote, is above all a moral issue. and at stake are not just the details of policy but fundamental principles of social justice and the character of our country. i thought about that phrase quite a bit in recent days. the character of our country. one of the unique and wonderful

things about america has always been ourself-reliance and rugged individualism and our fierce defense of freedom and our healthy skepticism of government. in figuring out the appropriate size and role of government has always been a source of rigorous and yes, sometimes angry debate. that's our history. for some of ted kennedy's critics his brand of liberalism represented an affront to american liberty. and in their minds, his passion for universal health care was nothing more than a passion for big government. but those of us who knew ted and worked with him here, people on both parties, know that what drove him was something more. his friend, orrin hatch, he knows that. they worked together to provide children with health insurance. his friend, john mccain, knows that. they worked together on patients bill of