that is fax chous logic as we saw today with facebook and starbucks. i like to say there's always a bull market somewhere. i promise to find it for you right here on mx mr"mad money." i'm jim cramer. i will see you tomorrow. good evening, everyone. i'm larry kudlow. this is the "kudlow report." we're live here at 7:00 p.m. eastern time and 4:00 p.m. pacific. and we begin tonight with another round of developing problems and questions about obama care. now, as you know, americans are still furious at the broken promises and costly surprises of insurance plan cancelations. plus, the obama care computer breakdown continues. and health secretary kathleen sebelius still refuses to come clean about the inside causes and costs of the fiasco. all right. first, tonight, we now know that the obama administration is muzzling insurance companies, telling them to keep quiet about all the canceled policies and

increased premiums. also, more democrats are starting to push back against the law. including senator mary landrieu who was working on a bill to allow americans to really keep their own health plans. and congressman darrell issa has subpoenaed secretary sebelius for the information regarding the botched healthcare.gov launch she so far declined to hand over voluntarily. all right. all those stories and more. on "the kudlow report" starting right now. this is just unbelievable. all right. now, we've got all this developing news here to analyze the whole story. we bring in bob lashevski. dr. scott gottlieb joins us, american enterprise resident fellow. and ovik roy, senior fellow at the manhattan institute. gentlemen, welcome.

ovik, let yes just start with you. this is a quick one, but i want to get it out. darrell issa subpoenaing sebelius. she won't come clean. he's been asking for documents, inside documents. who, what, where, what did the contractors tell her, what's it going to cost? >> i think it's a very significant development. as you said, sebelius has been stone walling. there's so much important information that we don't know. for example, the fact that they hadn't tested the system end to end, at least until a week before october 1st, and yet they still went ahead and launched this thing. they didn't have the security clearances set up, the security protections. the site crashed after 100 -- >> there are memos. >> there are memos. have the contractors not given memos? >> the contractors -- the memos on -- hhs knew about these -- >> the contractor said it's not ready. >> on paper. >> bob, on paper. is that's what we're going to discover? the contractors tried to warn them, they wouldn't listen? >> yeah. there's no doubt about it. they're pointing fingers at each other already. a number of decisions that were

made here were political decisions. for example, the architecture of the site that you couldn't browse plans until you signed in with all of your identity information because the administration wanted you to look at the net costs so that no one would claim there was sticker shock, for example. so much of this, and i think they launched on october 1st knowing there were serious problems. i mean, all the testimony up on the hill is that hhs, the obama administration, knew there were very, very serious problems with security, with systems crashing. and, yet, they went on october 1st. why? because they had been telling the public, the insurance industry, they'd been telling each other they're going to go on october 13st. i don't know what they thought was going to happen. >> cns, medicare, medicaid services, which was quarterbacking this, was reporting directly to the white house in an office managing the introduction of this plan in the white house. >> who ran that?

>> jean lam brbreu. she ran that office in the white house that is basically overseeing the implementation of this. >> hang on a second. i worked -- i was at level three. >> the domestic policy -- >> the office of management budget. i know how this game works. there's a domestic policy counsel. it meets with the president. you're going to mtell me the senior person in the white house staff on this subject did not meet with president obama and he can look at americans with a straight face and say i didn't know? i find that incredible. >> she was meeting with him. you know that. >> of course she was. >> what did she tell him? what did she believe? >> the president may have said, they'll figure it all out. let's launch it october 1. >> bob, let me come back to you. we have a whole lot of insurance companies muzzled. that's one of the headlines today. the white house wants to muzzle the insurance companies. i don't know how you do this when you send out cancelation notices and the press gets hold

of it. why is the white house this stupid to let a story like that come out? cnn reported the story. how could they be so dumb? >> well, there was ed griffiths at cnn. he interviewed me for that story and had five different sources inside the insurance industry telling him that. i don't know what the white house is thinking here. i can't explain it. how do you muzzle 2 million cancelation letters have already been sent. more are on the way. no one can get inside the website. everybody knows that. it's like they just keep spinning. i mean, they keep spinning in front of kathleen sebelius finally admitted it was a debacle. how do you spin a debacle? >> we talked about this before we went on the air. are you surprised? serious question. are you surprised at how fast this thing blew up? seriously. >> i'm surprised at how fast it has, but i'm not surprised by how it has blown up. i've been reporting at "forbes" f f for nine months about the i.t.

problems, privacy problems. henrik chao at ims said nine months ago i'm afraid this is going to be a third-real experience. everyone thought he was joking at the time. >> there's going to be plans that don't re-up, don't get -- they have until midnight tonight to pull out. that's probably part of the reason -- >> you're talking a ining about insurance companies. this is a really important story. they have to fish or cut bait this evening. let me go back to bob. you get a lot of that because it's about insurance companies. obama says their whole argument is you couldn't renew them, you had to cancel them because they were, quote, substandard. what was the word? bad apples. now, i tweeted your blog today which was a great thing, and you noted that you just don't open up an insurance company and sell a policy. you have state regulators.

in fact, you have state overregulators. does the president not understand that that the policies he said are substandard and rotten apples have already gone through a regulatory process? is that possible he doesn't get that? >> well, here's the big one, larry. his secretary of health and human services is the former insurance commissioner for the state of kansas. >> right. >> and just so your audience knows, the individual health insurance market is one of the most regulated markets in the united states. on average, each state has 50 mandates. mandates like maternity coverage or in vitro fertilization or chiropractic care. this is a marketplace that's filled with state mandates. rick perry's texas, supposedly, i guess the most pro-business state in the country, mandates 62 things in their individual health insurance plans. this is an incredibly regulated market. and the president said in boston, two things that just blew my mind. the first thing he said, it's substandard coverage.

substandard coverage with all this regulation, all these m manda mandates. number two, he called insurance companies bad an apples for issuing these policies. he had the leadership, his staff did in the white house, issued a statement saying this was going to be a partnership to implement the affordable care act. is this the way he treats his partners? >> unbelievable. >> they're going to need these insurance companies to stay in this market. the fact they're browbeating them now is surprising. >> it's not that surprising. >> a question -- >> larry, i know my angela merkel is upset. this is how he treats his allies. >> scott, dr. scott, okay, i'm a 60-something broadcaster. okay? pretty good health, et cetera. but why do i need lactation services? why do i need maternity services? why do i need abortion services? why do i need a whole fistful of sort of speech therapy. why do i need that? please tell me i need that and that that stuff is part of his

ten essential mandates. why? >> any service that's mandated is given an "a" or "b" grade by the united states preventative services task force, a body in washington, now has to be covered in full by all private insurers in this country, not just in the individual market exchanges but employer-provided coverage. >> why? >> because they want the insurance companies to cover ha they want them to cover. >> why can't they have differentiated products? i don't get that. >> if gm and ford, they have different cars. okay? can i be that simplistic? they have different cars. they have explorers. they have feeieiestas. >> you don't need lactation services. >> i don't. i don't. >> but if i need lactation services -- >> you can buy it. >> i need you to fund it for me. >> ah. right. i don't want to fund it for you. >> your wallet, larry. >> that's the thing. isn't this -- this is the adverse selection everybody talks about. young people in good health are supposed to finance everybody else. that's basically what this is. i'm not -- maternity wards and maternity services, fine. i mean, i'm for babies. i'm pro life.

as a matter of fact. i don't need it at my age. young people may not wish to have it at their age and get it later on. why can't that be flexibility? or is this just what government does? >> it's healthy people as well as young people. young people are healthy and that's why they're adversely affected. it's healthy people generally. healthy 50-year-olds are going to pay for sick 50-year-olds and sick 30-year-olds. healthy people are going it get hammered and the premiums go up the most. >> it's not a competitive structure. you can't buy policies to facility yofit your needs. only thing it changes is the co-pay structure. >> that's exactly right. bob, you know what strikes me, too, we'll wind up because we have a lot of other work to do tonight on this. this isn't really insurance. this is a prepaid health care plan forced upon the american people. this isn't really insurance. this is, you know, insurance is all about the deductible and about the risks. you know, once in a lifetime risk kind of thing. if god forbid something happens and you got a disease. this isn't that. this is a prepaid health care

finance program plan that they are jamming down our throats. you know why? because this is the liberal entitlement state. this is the great vision. i heard charles krauthammer talking about this last night, and i just loved it, couldn't agree more. what's your take on this? this isn't insurance. >> well, it's really interesting. you make a very good point. now, what they've done is they've mandated this huge package of benefits. and that drives the cost up. and so when you get to the exchanges, the standard silver plan which is the plan that all the subsidies are based on, it's the benchmark plan. because it's got all these things in it, the average deductible, the typical deductible in that plan is going to be $2,000. if you go to an employer plan today, the average deductible might be $1,000. it doesn't have all these mandates in it. what they're forcing people to do is accept this broad brush mandating and as -- but the

thing they have to give up for that is they're going to pay a lot higher deductibles, maybe $1,000 more, when they go for the basic health care they need. >> narrow -- >> yeah, a narrower physician -- exactly. there's a tradeoff. >> we'll come back to this physician, doctor thing. >> by the way, we have a real live ordinary person later who lost her insurance. she's in the middle of cancer and chemotherapy. we're going to talk to her as well. all right. gentlem gentlemen, bob, scott, ovik, stay with us. a lot more work to do later on. let me wrap this up by saying from day one of this health care decision, i simply never understood why americans cannot have and don't have the freedom to choose their own health insurance. right? i don't get it. personally, i don't want the liberal nanny state to make decisions for me. i can make it for myself, thank you very much. i can choose a car. i can buy a home. i can purchase a stock. whatever. but i do not want the government telling me what i cannot, cannot, legally do. this whole obama care business is the greatest expansion of the

liberal entitlement state dream. it's a dream, by the way, i do not want. and you shouldn't want it, either. and you know what, folks? that liberal government-run dream is going to crumble and dissolve before your very eyes. all right? we'll leave it like that. now, moving on, markets sold off just at the end of the trading day today, so are investors still bothered by the fed or something else spooking them on halloween night? we'll ask two top investors next up. as always, free market capitalism is the best path for prosperity. i will tell you this obama care plan has utterly nothing to do with free market capitalism. first, tonight's edition of obama care comic relief. check it out. >> the federal trade commission reports that con artists are using confusion over obama care to sign people up. you know, for what they call fake health insurance. the scammers lure victims with false promises. they say stuff like if you like your health care plan, you can keep your health care plan. see, they'll tell you that.

now, a lot of people accusing the president of being less than truthful. in fact, a couple weeks ago president obama called me, told me personally if i like my current job, i can keep my current job. well, i believe it. what is it about selling insurance that makes people liars? you noticed this? doesn't matter if it's your brother in law trying to sell it to you or the president of the united states. they're all just liars when it comes to insurance. i have no idea why that is. i don't know. (announcer) scottrade knows our clients trade

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welcome back to "the kudlow report." it was a tepid day on wall street as markets edged lower across the board. dow dropping 73 points. investors were spooked by corporate profits and ponder the reduced fed q.e. gold losing its luster today. the precious metal fell 2%. oil settling lower clocking in at $96.38. that's a four-month low. as we turn the calendar to november, october overall was a banner month for markets. take a look. the dow jones added 416 points this month and the dow and s&p 500 are sitting below their all-time highs. larry, traders are telling me they're calling this q.e.

euphor euphoria. >> many thanks. we close the books on a good, strong october up 4. 4% on the s&p 500. now, i happen to think the markets are misreading the fed. more on that in just a moment. what we do know is janet yellen is going to testify in her senate confirmation hearings two weeks from today. circle your calendars. november 14th. yellen testifying before the senate. let's bring in our ace investors. we have ken heebner with capital growth management. and michael farr from farr, miller & washington. it's great to see you. i don't know, i'm not a mind reader. i think a lot of people, though, are thinking the fed is not going to be easy and i want to put in, janet yellen is the empress, and i think inside the fed they want more inflation. they want to get the inflation rate up way -- 3%, maybe 4%. i don't know if they can do it, and they haven't so far, but i think they want more inflation which means more easy money. how does that translate to stocks? >> nothing can be more bullish.

for the first time in 40 years i'm hearing about a fed that's wanted more inflation. i've never heard that before. it can only be positive. when you have an economy with ample surplus capacity, forces that stimulating growth are increasingly different and active. rising prices of stocks. rising price values of homes. the consumer is reliquifying and experience important balance sheet appreciation and the recent spate of negative fears associated with the political brinksmanship over default and the budget -- and the government shutdown. that's behind us. that scared people. we never had a real threat of default before. so now people are free to look at the future. which is really exciting and bright. >> ken, you have had a great record. you have ridden this bull for all these years. you've ridden this bull this bull cycle. you just nailed it. let me just ask you, if i'm right, i may or may not be right, but if i'm right the fed is going to continue to inflate the money supply, whether that works or not remains to be seen.

i think that's their policy. and profits are still rising, albeit slowly, ken. how long does this bull market cycle have left? i get this question all the time. does it have a year? does it have two years? what's your take on this? >> it will end when the fed has to tighten because we've exhausted our resources. when we're coming up against bottlenecks in the economy and inflationary forces are rising to a level that the fed finds unacceptable. when your inflation rate is 1%, it can move up to 3% or 4% without the fed having to reconsider its easy policy. rarely in the last 40 years have you had an economy where the fed was probably going to be your friend for three or four years and that is a really bullish, important fact. >> michael farr, what's your reaction? i think what ken said is absolutely brilliant. absolutely on target. >> i know you do. >> what's your reaction to that? >> i think that the monetary policy is going to stay easy. i think that janet yellen is our

new monetary mamma is going to keep the good flow of lots of -- >> empress. she is the empress -- >> empress. okay? >> she was the queen of the doves but i've given her a promotion. she's now the empress because i think the fed wants 3%, 4% inflation. >> they need to get this thing growing, because i mean, the fear i think is still deflation and they've got so much cash on the sidelines we're not seeing that. but i worry in a market that's up this much about new investors coming in with expectations it's going to keep going up. you get 3% inflation or 4% inflation, you're going to have higher mortgage rates. and we've seen what happened last time. just at the hint that they would taper. we saw those mortgage rates ratchet up. we saw the ten-year treasury ratchet up and the real estate market slowed. i don't think we can have the recovery if real estate stalls. i'm concerned. cautious. we're up 26% this year. i'd be cautious about this market. >> unbelievable. fair enough. i don't know that the fed can

even achieve higher inflation. they haven't so far. i'm just saying that's their goal. ken, as an optimist and a bull, what are your favorite investments right now? >> the industries showing the most strength are automobiles. and i also think that the housing industry has hesitated, but dollar order growth continues to rise. the biggest factor in slowing down the housing industry has been the, as the prices went up, people backed off a little bit. as they get accustom to this level of prices, i think renewed buying of homes is going to continue. i also think the money -- >> the price going up, ken, for the consumer, whether it's the actual price of the house or the price of the money is still an equal increase. even if they get used to the higher price of the house if they have a higher price of money, they're going to stop again. right? >> well, you know, if interest rates were -- if the mortgage rate was 6% or 7%, then i'd say it's an impediment. but when the mortgage rate is 4.3% or 4.5% this is the lowest

it's been in 50 years so it can rise over 5% at a minimum before it has any negative impact. don't forget, it's tax deductib deductible. >> i disagree. okay. >> last word. are you disinvesting, mike? >> no, no, i'm always fully invested. i've been riding this. i've been delighted. we've had a very defensive take on the markets. as you know, i've stayed with my health care, my technology. my industrial stocks and my consumer staples. we've been looking like a hero. i hope it continues. but i don't -- i think you're much wiser when prices get this high. p/e multiples expand and profit margins are at all-time highs to hit your singles and doubles. >> buy and hold. that's my mantra. this thing is going to come to an end. they always do. i know that. >> yeah. >> but right now, it isn't the end. i'm with mr. heebner on this one. thank you.

we appreciate it very much. now, news, israelis take out a huge shipment of russian missiles in syria. looks like they were being sent to the terrorists at hezbollah. we're going to have the latest on that developing story and more, just ahead.

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as over 60,000 trees. that's a trend we can all get behind. the israeli air force takes out russian missiles headed for hezbollah. we're joined for that and the top breaking stories. good evening, officially. >> good evening, larry.

that's right. a u.s. government official tells nbc news israeli military forces destroyed a stockpile of russian missiles that the syrian government was reportedly prepared to deliver to hezbollah. the surface to surface russian-made missiles were in a syrian stockpile at a port near the russian naval base on the syrian coast. staying in the middle east, crude oil sold off today as the obama administration stepped up pressure on the senate to hold off on another round of iran sanctions. the white house wants more time for nuclear negotiations to take hold. the senate banking committee had planned to introduce a bill next week that would blacklist iran's mining and construction sectors. the house overwhelmingly passed a similar bill in july. the country's 2013 budget deficit has dropped to just $680 billion. that's its lowest level since 2008. treasury credits higher tax receipts for about 80% of the defic deficit's reduction as tax revenues jump nearly $3 trillion. watch out, opec. texas is in the midst of an oil

boom. the eia reports that production in texas is up 29% from last year. if this trend continues, texas crude oil production could surpass all opec members except saudi arabia as early as next year larry? >> you know, thanks. i just add to that, yes, the deficit's come down nicely, but i think these so-called experts aught to see what the budget caps and sequesters have done. spending, discretionary spending, has moved down all the way back to close to 2007, early 2008 levels. and that is some achievement. anyway, thanks very much. now, back to our top story this evening. we have numerous developing stories of new problems and questions about obama care. but first, keeping your insurance plan isn't the only broken promise from president obama on health care. remember all the times he promised obama care wouldn't add a dime to the deficit? check this out. >> i won't sign it if that

reform adds even one dime to our deficit over the next decade, and i mean what i say. i will not sign a plan that adds one dime to our deficits. either now or in the future. health care reform will not add one dime to our deficit. as i just noted, not only is it not adding to our deficit, it's actually reducing it. the reform we seek would bring $1.3 trillion in deficit redex ov reduction over the next two decades. news alerts is sponsored by expedia.

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welcome back. live to "the kudlow report." here's some of the top developing news stories on obama care tonight. it's possible that a year from now, that 156 million americans with employer health coverage, 93 million of them could be facing cancelations and forced on to the exchanges and medic d medicaid. more on that in just a moment. we also have a major business angle to the obama care debacle. some major players in health insurance are opting out of the exchanges. or so we think. frankly, there may be good reason for it. just doesn't make good free market profitable sense. and senator ron johnson, joining us in just a couple of moments, he's putting together a bill that truly will allow you to keep the health plan you like

but are being killed by obama care. even senate democrat mary landrieu appears to be putting a similar bill together. now, back with us to talk about all this, bob, dr. scott and ovki roy. can i just talk about, ovik, i think this was your story. the 93 million uninsured. in other words, let me get this right. for the viewers and myself. the same strictures that app applied, the same mandates that applied to individual are going to apply to the employer financed or backed insurance and they're not going to measure up. people are going to be out of luck in a year. >> it's not necessarily that they're going to be uninsured if this happens. right? their old plans will be canceled and replaced with new plans that might be more expensive, have higher deductibles, narrower networks and all the things we were talking about in the last segment. >> will those new plans come from obama care? will they push into obama care? will they come from private

exchanges? will they come from medicaid? >> the bulk of them will be issued by the same types of private insurers who offered the plans before. some people will be dropped in the exchanges. but the bottom line is the plans will cost more in terms of the premiums, and they'll have higher deductibles and higher cost -- >> big tax hikes. >> and if you have a plan right now that where the costs haven't gone up, chances are it's been cheaper in some way you don't know. probably the network has been narrowed. the mandates started to apply to employer-provided coverage this year. for example, lifetime caps were lifrt lifted. employers had to charge more for the plans or offsetting it somehow. >> bob, can i ask, maybe this is a dumb question, but it spills into the issue of these big insurance companies that look like don't want to play obama care. tonight's the deadline, by the way, october 31st. speaking specifically about, let's see, united health care, cigna and aetna. three big guys. may not want to play much, if at all, in obama care. what about the other example? there are private exchanges, non

obama care private exchanges like walmart, giving their employees a certain amount of money and giving them a list of 20 companies or 20 plans on private exchanges. what's wrong with that? >> well, there's nothing wrong with that. that is sweeping through the market right now. that's going on in the large self-insuranced employer market. obama care has very, very little impact on employers with greater than 50 employees and certainly the big employers. there are some impacts which we don't need to get into right now, but they're generally able to do much, pretty much anything they want to in terms of offering a slate or calf teefetf benefits. many are moving to private exchanges where they give their employees more competition. they're working pretty well. the administration's been excellent of them. so they're a real option. more and more employers are thinking about them. >> why doesn't anybody in washington talk about them? certainly obama probably wants to put an end to them.

>> there's a law called the employee retirement income security act which exempts large employers from these state-based regulations. if you offer plans in a lot of different states and you opt out of the state-based regulatory scheme, then a lot of these insurance regulations don't apply. it's not insurance. what you're doing as the company, if you're a fortune 500 company, say if you're walgreens, you are directly paying for the health cost of your employees. you're not paying a premium to an insurer who's a third-party payer. the technical difference allows them to escape a lot of regulations. >> there are real choices on the private exchanges. it's not one size fits all. there are real choices. that's the future. people need to know that. >> that's the future. >> scott, what about cigna, united health care and aetna? are they going to play? >> they haven't played. cigna is in five markets. united is is in about a dozen. they have an advantage to not getting into the exchanges. if you sell products inside the exchange and sell products outside the exchange, you have to treat it as one risk pool.

inside the exchange, you have sicker, older members you have to price the premiums for the plans you sell outside the exchange the same way. if you don't play in the exchange at all and sell plans outside the exchange, you can price those relative to the risk pool you generate outside the exchange. the reason they wrote the law the way they did, they didn't want selecting healthy members out of the exchange. they never envisioned plans wouldn't get into the exchange at all. there's an advantage to staying outside the exchange selling bronze only cheap plans and select the healthier members. >> bob, is this going to hurt their profits? these are big publicly traded companies. is this going to hurt their profits? originally, as i understood it, some people, i won't name name, but some ceos thought the obama care thing was great because more and more customers would come into share insurance company plans. what happens now? if they don't play, how does it affect their bottom line? >> if they don't play in the exchanges, it's not going to have any impact. right now, as kathleen sebelius called it, the debacle that's

gone on with the websites and so forth, the insurance companies that stayed away, i think most of them really stayed away more because they were afraid of what was going on. everybody in the insurance industry knew there was a big problem coming. i don't think anybody expected it to be this bad. but their decision to stay away, many of these plans have said they will come in later when the kinks are ironed out. that's probably proving to be a really smart business decision. the plans that are playing, are likely going to take some lumps here because the way this thing is working out, it looks like we're going to have some anti-selection here. you know, all these problems, the sick people are going to show up. there was a cynicism about obama care before all of this. you got to believe the cynicism about obama care has grown and a lot of people are going to sit on the sidelines especially with all these delays. >> all right. so adverse selection is going to be a key theme. >> it is. >> where are the young people going to go? >> i think a lot of the young people are going to go outside the exchanges and buy catastrophic plans that are noncompliant or buy cheap bronze only plans like i said, you

know, if you have a risk pool outside the exchange, could be cheaper than going into the exchange. >> can the big insurance companies sponsor those plans? >> in some states. depends on the state. remember, for a lot of people, it's going to be better to stay outside the exchange than inside the exchange. even with a subsidy the plan inside the exchange is more expensive, especially next year when the prices reset according to the risk pool that you're having. >> last one. i want to go across statelines. i think that's the ultimate pro-market competitive solution away from tax policy for obama care for all health care. why can't i go across state lines? >> well, let me just say this. it's not a magic bullet. it would help. there's an economist at the university of minnesota who's done a study on this. he said it would reduce prices by about 9%, 10% and increase coverage of about 10 million people. but it wouldn't solve all the problems in our health care system. to do that, you have to get rid of tax code preferences. >> we have to give it to the individual. >> and reform medicare. >> oh, reform medicare.

how about medicaid? >> that would be helpful, too. >> i think that's going to blow up the budget. you guys don't agree. stay with me. stick around. right now, let's talk about the effort in congress to really let you keep the insurance plan if you like it. all right? that was the president's original idea. got thrown out in the wash. we have senator ron johnson putting together a bill to make that happen. and you might get some real democratic support. he is next up on "the kudlow report." please stay with us. (vo) you are a business pro.

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welcome back to the "kudlow report" with this news alert. flexible health spending accounts. fsas for short are becoming more user friendly. the treasury department and irs announcing today that they are modifying existing fsa use or lose rules. participants will be able to carry over up to $500 of unused fsa balances remaining at the end of a plan year. back to you, larry. >> all right. very interesting. actually a positive development. many thanks. remember when president obama promised us this? take a listen. >> no matter how we reform health care, we will keep this promise. to the american people. if you like your doctor, you will be able to keep your doctor. period. if you like your health care

plan, you'll be able to keep your health care plan, period. no one will take it away. no matter what. >> well, turns out that's not actually the case. at least 2 million people and counting have been told they can no longer keep their existing insurance plans. and that's left some members of congress including some democrats outraged. well here's republican from wisconsin, senator ron johnson. he unveiled a bill yesterday to allow americans to keep their health plans. as always, senator, welcome back to the program. tell us about -- >> hello, larry. >> -- your bill, please. tell us about your bill, please. >> first of all, isn't that stunning to hear president obama repeat that promise? i mean, he was either being totally dishonest, or he was totally disengaged, had no clue what was in his health care law and didn't understand the consequences of. so what my bill does, it actually is a true grandfather clause. it will actually honor that promise for millions of americans by actually allowing them to keep the health care

plan that they do -- that they do choose, that they have the freedom to choose. >> will this include, by the way, employer-based health care plans? >> right. yeah. what it basically does is if you have a health care plan in place by the end of this year, if you like it, it's not going to load up any additional mandates because that's what president obama's grandfather clause did is said, yeah, you can keep your health care plan as long as it complies with all of our mandate and all that added expense. if you like your health care plan, you actually can keep it. very simple. >> senator johnson, isn't it the case while the president has been out there for several years, saying you can keep your plan, you can keep your doctor, that his own senior staff people were hammering down regulations that would knock out the grandfathering? and they had to -- they all knew that. they all knew that. they -- >> yeah. >> -- made him a liar. i mean, in some sense. i have a hard time believing nobody in the white house understood what was going on. >> well, this isn't just the way they wrote the regulation.

you're right, when they wrote that regulation, his own agency said 40% to 67% of americans, back in 2010 they knew this, were going to lose their health care plan. larry, it was obvious. it was obvious to me sitting in oshkosh, wisconsin, that millions of americans would lose their health care plan because all the incent receives were there, for example, for employers to drop health care coverage and dump their employees in the exchange. we saw rahm emanuel, his own chief of staff, now mayor of chicago, he's dumping chicago retirees in the exchanges. so it was obvious to anybody that really understood what that health care plan was all about. it should have been obvious to the president. >> tell me about inside this thing, you've got 30-something co-sponsors. do you have democrats? >> we've already got 40. i did hear that senator mary landrieu is talking about crafting a bill of her own, but ours is so simple. it uses president obama's own grandfather language. we just extract those mandates. so it's going to be difficult for mary landrieu to craft a more simple bill that does what

president obama promised it would do. >> can you get a vote on that, has reid said anything? harry reid. or what? >> i sure hope so. let's face it. all of these democrats that voted for this thing, you know, the question we ought to ask every one of them is, did you believe the president? did you really think that millions of americans wouldn't lose their health care? did you really think the health care would -- the cost of it would decline by $2,500 by year per family? if you didn't believe that, step up to the plate and protect the millions of americans that are losing their health care plan right now. step up to the plate, support my bill, honor that promise that president obama made. >> good luck to it. senator johnson, thank you very much. hope you can get that thing up and through. up next on "kudlow" we're going to hear from one of the millions of americans who is losing her current health care plan at the end of the year. it's outrageous. she's going to share her story with us up next. plus on this halloween night, more americans are getting spooked by washington.

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welcome back to "the kudlow report." michael myers, jason, freddy krueger are three of the scariest horror movie villains of all-time. on this halloween night, it might just be the federal government that's the scariest of all. a new poll found that 37% of americans think zombies would do a better job running the country

than d.c. lawmakers. larry, maybe a zombie i.t. department would have a better chance of fixing obama care's broken website. >> many thanks. this might be worth a shot. it might be worth a shot. all right. so senator ron johnson just told us about his plan to hold president obama to his word about obama care. now let's hear from one of the many americans who says she is losing her current health care plan at the end of the year. here now is joan to share her story with us. still with me, bob, scott, and ovik roy. joan, thank you very much for sharing. first of all, when did you find out you were canceled? >> i found out about three weeks ago. >> and what are the direct implications for you? how does this thing really affect wyour life? >> the bottom line is i currently have an individual blue cross blue shield of michigan ppo. aisle extremely happy with it. i've been battling cancer for six years.

my premiums are high, but blue cross has taken excellent care of me. as well as my university michigan doctors. i got this letter three weeks ago saying my insurance was being discontinued or canceled as of december 31st. i'm currently receiving chemotherapy, iv infusions about every three weeks which is an improvement. as of may, i was receiving them every week for almost two years. and i'm devastated. my premiums are absolutely skyrocketing. and -- >> i just want to say, godspeed on the cancer battle. that's very important. >> thank you. >> before we go back into this technical stuff. what will happen now? i assume you have options, you're going to switch plans. if that happens, let me just ask you, what about your oncologist? what about your doctors? do you lose all that? >> i'm hoping i will not. i'm currently be university of

michigan. when i last got my chemo, i talked with my doctor about it. i told him for the first time instead of living day-by-day, i'm looking ahead. i have to choose between a bronze, gold or silver coverage. which is, like i said, skyrocketing. so at this point, i'm trying to decide which plan to take, and whether he will continue to be with the plan and cover me. >> who sponsors this plan? who would sponsor it? are you talking about the obama care bronze plan or someone else sponsoring that? >> i could not get on obama care. as many times as i've tried, i could not get on to the obama care site. so i called my agent, and i very much like to stay with blue cross blue shield as they've taken really good care of me. and all i'm after right now is keeping my plan, paying the rates that i have. my husband is a saint. he's 72 years old and still working so he can support me and

get me through this. >> larry -- >> how much of your own expense? >> can i ask joan a couple questions? >> go ahead. >> joan, you called michigan blue cross? >> yes. >> okay. >> i'm talk to an agent. >> well, and i think it's very important for people in this circumstance to call their existing insurance company because you can get through and they can give you some help and you don't have to wait for the website to open up. first of all. secondly, did anybody talk to you about whether or not michigan blue cross has an early renewal program? >> no. no. they didn't. >> okay. check there. most of the plans are offering something called early renewal which enables you to change your renewal date on your plan and keep it until december of 2014. now, i don't know if that's the case in michigan. some states, believe it or not, are prohibiting it. >> oh, really. >> but make sure your agent checks to see if you have an early renewal plan. you might be able to stay on. as millions of people are finding out, who are getting

these letters. you might be able to stay on your plan until december 2014. >> that would help. >> i think you're doing -- >> are they charging you more for the new plan versus the plan you had last year in 2013? how much are your premiums going up? >> my out of pocket cost which is the bottom line, because they've thrown in co-insurance, deductibles and the out of pocket cost is going to be anywhere from $4,500 to $6,500 per year. and i'm paying what i think is a -- i have a very expensive plan right now, and i definitely want to stay with the ppo. >> how much is the premium going to go up? >> my -- well, again, if you look at the premium, depending upon which plan i take, it gets very confusing. my premium may drop. it may go up. the bottom line costs go up from $4,500 to $6,500. >> $2,000 more for the dedu

deductib deductible. the other challenge, a lot of the plans on the exchanges don't use academic medical centers, the most expensive medical centers. most exchange plans do not allow you to use those providers. >> that's my concern. i mean, i have excellent doctors and i want to stay with them. they're the reason i'm ai've. i've been battling this disease for six years now. >> have the doctors made a decision yet whether they're going to contract with any of the exchange-based plans? have they told you whether they've decided to do that? >> i don't know. i've talked to many people at university of michigan and everybody is very confused. as well as me. >> most doctors haven't signed contracts, and the ones who were going to haven't done it yet. >> well, joan carrico, first of all, as i said before, good luck and god bless. >> thank you very much. >> on your battle. we appreciate you coming on very much. i say to our panel of distinguished experts, this shouldn't happen. i mean, the authorities, mr. president obama, and all his group, should have known that this stuff was going to happen and it shouldn't happen.

that's the part that kind of burns me up. and, you know, it's not affecting me directly, but it is affecting her directly and i process this and say, come on. come on. why would you do that? why would you make a promise and not keep it? knowing that real people are going to get hurt. anyway, joan carrico, thank you. bob, dr. scott gottlieb, ovik roy. thanks. you guys have been terrific. that's it for tonight's show. thanks for watching. much more coming up tomorrow evening. i'm larry kudlow. , we believe outshining the competition tomorrow requires challenging your business inside and out today. at cognizant, we help forward-looking companies run better and run different - to give your customers every reason to keep looking for you. so if you're ready to see opportunities and see them through, we say: let's get to work. because the future belongs to those who challenge the present.

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>> in kansas city tonight, prosecutors are calling it a nightmare... >> narrator: it's unthinkable. the man who critically ill patients think is their ally turns out to be their worst enemy. >> i personally feel like she was murdered by him. >> narrator: pharmacist robert courtney intentionally dilutes thousands of patients' chemotherapy drugs, putting countless lives at risk. and it's all because of greed. >> robert courtney did this on purpose. he did it on purpose. >> that's about as cold and callous an individual as i believe you can get.