slovenia. our infant mortality rate ranks 30th. it's more than twice that of sweden and japan. so what is our problem? in this hour in a "time" magazine essay, we will take you around the world to find out what lessons we can learn from others. we'll visit great britain, taiwan and switzerland to find out what those nations are doing right and what they are doing wrong. we will also show you some really interesting innovation going on back here in america. in one of the most poorest and crime-ridden cities in the nation. first, let's talk about the one thing americans are certain is bad. government-run health care across the atlantic in great britain. is the nation's health service an evil death panel as some say? let's take a look.

during america's debate over health care reform, critics said britain's government-run system was a bureaucracy that rationed care to those in need. were they right? britain does have a system that is as close to socialized medicine as any rich country gets. the government pays for everything, owns most of the hospitals and pays most of the doctors. but consider this. compared to americans, the brits have longer life spans, a lower infant mortality rate and a health care system that consistently ranks higher on every measure. all this and everybody's care is covered. no payments to doctors and no charges from your insurance company, and no co pays or fees or nothing. at king's college nopt -- hospital in london, a transplant

surgery is performed with a live donor. a young man is giving part of his liver to his younger brother. the liver is cut in half with y one part for the younger brother and one part staying in the donor. >> the liver is a remarkable organ, so can you take pieces of it and it will function well. >> this transplant costs tens of thousands of dollars, but under nhs, the patient doesn't pay a thing. >> when patients come to us, we only evaluate them from the point of view of what they need. do they need a liver transplant? the cost never comes into it. as a surgeon i love that because the focus is on the care that i can deliver. >> nobody pays a doctor's bill on the nhs. people will go their entire life without paying a single upfront

cost. >> the doctor here is the chair of the college of practitioners. >> all service is fair, and it's irrespective of your illness, you will be able to access health care. that is what we require. that is what is a fair and honest health system. >> compare that to the u.s., where an estimated 137,000 people died over seven years because they were uninsured. of course the brits do pay for their health care in another way, with taxes. the sales taxes are a whopping 20%, and income taxes are as high as 50%. all of that money feeds a health care bohemith. the nhs is europe's largest employer with well over 1 million people on the payroll. so you think it would be inefficient. >> that seems sensible, right? the private sector can do things more efficiently. it doesn't work in health care.

>> a bureau chief for the "washington post" toured the world's health care systems for his recent book "the healing of america." >> the least efficient pairs is the insurance companies, and they have administrative costs of 20 to 30%. that's a 30% tax on every dollar you spend on health care. bra britain is totally socialized medicine and administrative costs, 5%, and canada is private doctors, and public payers, and 6% administrative costs. so it turns out in health care, governments are doing this more efficiently than our private sector. >> one reason, private insurers in america spend more money on nonmedical costs, like ads and review claims to help them stay profitable. another way governments can be more efficient when they're footing the bill is by having is a more coordinated approach to health care. for instance, the nhs rewards primary care doctors with

bonuses for achieving certain measures of good health, like getting patients to quit smoking. that's money well spent because fewer sick people means lower health care costs for the country. on average, the british spends $3500 a person on health care. in the united states, we spend around $8500. >> what about the argument that the only way to make the system work, only way to get costs under control is to be -- you've got to be a little cruel. you've got to say, we will pay for this, and we won't pay for that. >> that's absolutely true. the british health minister said to me, we cover everybody. but we don't cover everything. >> not covering everything, the so-called rationing of care is the british system's most controversial element. and one man in particular is at the center of that system. >> occasionally we do find ourselves up against everybody, the physicians and the patients and media, and sometimes it's a

real challenge. >> so andrew dillon is known as nhs, and it's the government body that decides which treatments the government will and will not pay for. >> this isn't about policies. it's not about money at the outset. it's about the evidence of what works best. the clinical studies that are done in this country and across the world. >> it's weighed by independent panels by doctors, not government bureaucrats. their decision making process is transparent. the public can weigh in. but the policies involve some of the most vexing moral dilemmas in medicine, like whether to fund a last-line-of-defense cancer drug. >> in the end there is nothing

else in life like facing death, and we have to face that, and we need to make sure we are keeping our eyes on everything else that we need the nhs to do with us. >> another controversial aspect of british health care, long wait times for certain procedures. in the early 1990s, you could wait more than a year to be admitted to a hospital for a nonemergency. the nhs rule book now gives patients the right to be treated within 18 weeks of being referred. that's still a long time to be standing in the queue. britain's government system provides good care for all and is more cost-effective than one might imagine. but the quality of its care can shift as funding waxes and wanes. so is there a way to provide for all with less government? when we come back, we will visit a country that went from almost half of its population being uninsured to nearly full coverage in less than a year and without breaking the bank. [ male announcer ] citi turns 200 this year. in that time there've been some good days.

and some difficult ones. but, through it all, we've persevered, supporting some of the biggest ideas in modern history. so why should our anniversary matter to you? because for 200 years, we've been helping ideas move from ambition to achievement. and the next great idea could be yours. ♪ [ male announcer ] for our families... our neighbors... and our communities... america's beverage companies have created a wide range of new choices. developing smaller portion sizes and more low- & no-calorie beverages... adding clear calorie labels so you know exactly what you're choosing... and in schools, replacing full-calorie soft drinks with lower-calorie options. with more choices and fewer calories, america's beverage companies are delivering. a little bird told me about a band...

♪ an old man shared some fish stories... ♪ oooh, my turn. ♪ she was in paris, but we talked for hours... everyone else buzzed about the band. there's a wireless mind inside all of us. so, where to next? ♪ ♪ what started as a whisper every day, millions of people choose to do the right thing. there's an insurance company that does that, too. liberty mutual insurance. responsibility. what's your policy?

what would happen if a country were given a blank slate

to design its health care system? if it could choose from any nation in the world, which one would it imitate? taiwan had that unique opportunity, and that story provides eye opening lessons for the united states. economies like taiwan and singapore skyrocketed in the 1980s and '90s. taiwan was growing at 7% a year, joining the ranks of rich countries in no time. >> the country was getting richer. however, the health care insurance system was not all good at the time. >> a health policy expert at princeton says 41% of taiwan's population had no health insurance in 1995. >> we paid out of pocket. and for the really poor, then you pray a lot. >> so taiwan's government decided to reform its system of

care from the ground up. william show, a professor of economics at harvard s one of the world's leading health care gur gurus. he proposed a bold approach for taiwan's health care reform. >> we invited experts from all the whole range of countries, so we can throw out the lessons, and their experience for taiwan. >> the panel considered the u.s., its close geopolitical ally, as a model for health care. they were not impressed. >> you can learn whatnot to do from the united states rather than learn what to do. >> they also looked at great britain, but the brit's government-run system was producing long wait times in the '90s. >> bureaucracy is not the best and most efficient way of running operations. >> and then germany, they had so many different funds and the administrative costs were just too high.

so taiwan went with a single pair insurance model where there is only one insurer in the market, the government. they combined that with private doctors and hospitals to avoid too much bureaucracy. the system looks like american medicare, only it's for everyone, not just the elderly. taiwan's president at the time made a huge push to implement the plan quickly in 1995. miraculously, taiwan's uninsured dropped from 41% to 8% in less than a year. taiwan has a highly rated health care system. what is more, it's a rock star when it comes to holding down costs. the taiwans spent 7% on their health care, and that's compared to our 17%. the government drives a hard bargain on fees with providers, and taiwan can monitor its spending with this cool device,

the smart card. you swipe it anytime you go to the doctor, and they can pull up recent medical history, and when you are done, he'll have a record of that day's visit. then he'll send an estimate of your bill to the government right away so officials know how much has been spent at any given time. compare that to the medicare in the u.s. which can only estimate the spending levels two years after the fact. >> in taiwan, that's recorded on a daily basis. >> but wouldn't all of that government stinginess make it hard to see the doctor? surprisingly, that's not the case. americans go to the doctor four times a year on average. the taiwanese go around 14 times a year. >> and they stay in hospitals much longer than americans stay in hospitals. the average length of stay for a taiwanese in a hospital is ten days. in the u.s. we're five days.

>> so how do the taiwanese provide all of that care for such low costs? one way, the doctors work their tails off. dr. gary lynn's primary clinic is open 11 hours a day, six days a week. >> i take care of more than 200 patients a day. >> the fees that government insurance pays doctors are very low. he gets $14 for each primary care visit. his colleague in the u.s. makes $100 per patient. taiwan's legtd -- legislature just raised the insurance premiums people pay to get into the system. but don't expect politicians to do something unpopular like that very often. >> taiwan has succeeded in raising premium rates twice. just twice. >> no matter which health care system you visit, politics always comes into play.

the next country we're going to visit has some remarkably similar politics to our own. it passed a version of obamacare 18 years ago. has it worked out, or is it a disaster? find out when we come back. [ buzz ] off to work! did you know honey nut cheerios is america's favorite cereal? oh, you're good! hey, did you know that honey nut cheerios is... oh you too! ooh, hey america's favorite cereal is... honey nut cheerios ok then off to iceland!

in here, every powerful collaboration is backed by an equally powerful and secure cloud. that cloud is in the network, so it can deliver all the power of the network itself. bringing people together to develop the best ideas -- and providing the apps and computing power to make new ideas real. it's the cloud from at&t. with new ways to work together, business works better. ♪ with new ways to work together, business works better. see life in the best light. [music] transitions® lenses automatically filter just the right amount of light. so you see everything the way it's meant to be seen. experience life well lit, ask for transitions adaptive lenses. i think we should see other people. in fact, i'm already seeing your best friend, justin. ♪ i would've appreciated a proactive update on the status of our relationship. who do you think i am, tim? quicken loans?

at quicken loans, we provide you with proactive updates on the status of your home loan. and our innovative online tools ensure that you're always in the loop. one more way quicken loans is engineered to amaze.

taiwan showed us that public insurance can work. but let's face it. government insurance for all is probably not a popular campaign slogan for many americans right now. so we searched the world for a completely private model. no government insurance or state-run hospitals. we found one in europe, of all places. imagine an alternate universe where a version of obama care has been the law of the land for almost two decades. no, you haven't entered the twilight zone. you're in switzerland. >> tell the congress you want us to act and act now! >> right around the time president clinton was pushing health care reform in the 1990s, ruth dreyfuss, a left-wing swiss official, was pushing reform in her own country. she faced a lot of tough questions. >> will we have to pay for the treatment of obese people?

will we have to pay for abortion? >> switzerland is not your typical european welfare state. it's extremely business friendly and it's always gone its own way, shunning the euro and charting its own course in health care, with private providers and private insurance. that's actually not so rare, according to journalist t.r. reid. >> one of the things that many americans believe about health care around the world is that other rich countries in the world all have socialized medicine. is that true? >> no, that's baloney. some countries do have government provide the care and pay for it, but a lot of rich democracies, germany, switzerland, japan, belgium, the netherlands, cover everybody in the private system, private docs, private hospitals. private insurance. germany, swit zer land, they don't have medicare. people stay with the private insurer to the grave. >> the swiss were getting fed up with their private insurance system in the early 1990s.

costs were rising, premiums were disproportionately higher for women and the elderly, and those with pre-existing conditions had trouble getting coverage. some were foregoing insurance altogether. >> the people were flying out of the insurance, so we had to stop this. >> dreyfuss, who would later become switzerland's first woman president, pushed for a law that required everyone to buy insurance, gave subsidies to the poor, and stopped insurance companies from rejecting people for their medical history. sound familiar? that's exactly what president obama's law would do. but in switzerland, it was an uphill battle. the law passed parliament, but barely squeaked by in a national referendum with 52% of the vote. >> where nobody was really happy, but everybody could accept. >> so how is the swiss version of president obama's law faring almost 20 years after it was put in place? >> i'll show you the x-rays we did. >> everyone is now covered and

the the care is still top-notch. the swiss enjoy one of the longest healthy life expectancies in the world. >> we have an extremely comfortable system. i mean, the access is easy, you don't have to wait. >> tom zelckner was the swiss secretary of health from 1991 to 2009. >> hospitals have become more like five-star hotels, offering health care. >> the swiss law went above and beyond obamacare. insurance companies were already banned from making a profit on basic health coverage. under the new law, they had to expand that basic package, covering even more procedures. >> even very expensive pharmaceuticals are paid by the insurance plans and have to be paid. >> the swiss system is world renowned for the choice it provides its users. >> i chose the doctor i wanted to go to. i went there, and it was seamless. >> we caught up with jocelyn

mills and her husband, phillip thompson, two americans living in switzerland. jocelyn was expecting at the time. she could go see a specialist right away without waiting for a referral from her physician, like in the u.s. >> i always waited three hours in an overcrowded waiting room, you know, to see somebody, then to see a specialist, if anything was wrong. so i don't have that here. >> another bonus, health insurance isn't linked to employment. plus, you can change your insurer every year if you want. >> the choice is such that it is sometimes confusing. you know, you have in each town you're living, a choice of probably 100, 200 different plans. and you also need a coach or someone helping you to choose your health insurance plan. >> experts worry that the swiss don't reap the cost savings from their insurance choices because there are so many of them. that might explain why health

care costs in switzerland are still very high. 11% of gdp. >> you cannot make a perfect law. but you can make a perfectible law. and i would say any law has negative side effects. and this is our lesson. we are still working to make this law better. >> health care costs are rising all over the world. but in the united states, health care is almost twice as expensive as everywhere else. why is that? we'll explore that question, next.

while some fiber ads use super models, metamucil uses super hard working psyllium fiber, which gels to remove unsexy waste and reduce cholesterol. taking psyllium fiber won't make you a model but you should feel a little more super. metamucil. down with cholesterol.

there is no greater threat to the american dream than the rising cost of health care. it already takes up around one fifth of our economy. by 2050, it could consume almost two-fifths, crowding out vital spending on other things, not to mention the military and social security. how on earth did we get here and what can we do about it? >> a big underpinning of the system is all of us kidding ourselves. someone else is magically paying for this. well, there is no one paying for it, except all of us. >> david goldhill, the ceo of the game show network, is an unlikely agitator in the health care debate. he got involved after his father went to the hospital with pneumonia and died from an infection while he was there. >> i saw a hospital with less impressive information

technology than my dry cleaner has, than my auto mechanic has. a couple times, my father was taken for procedures meant for other patients. there's trash on the floor. almost everywhere, it overflows in patients' room. you're endlessly dealing with personnel who don't know anything about your case. this is the intensive care unit we're talking about. >> the fate of goldhill's father is all too familiar. every year, an estimated 100,000 americans die from an infection they got in a hospital. >> once i got beyond, obviously, the personal elements of the tragedy, i thought, there's something very unusual about this. just in the scope of how the world works today. and as i spent time thinking about health care, i began to think about the lack of real accountability to customers. and the incentives to bad behavior that really dominate the way the industry is structured. >> unlike many markets, customers don't really pay their own bills in health care. instead, it's a private insurance company or the government that pays. in the case of goldhill's

father, medicare picked up most of the tab. which was over $600,000, before a hospital discount. >> to all of us, that seems terrific, right? i look at it a different way. if medicare had said to my mother, you pay the bill, and the hospital had come to my mother and said, here's what we're charging you for killing your husband, the collection would have been zero. there's no way my mother would have paid that bill. there's no way any of us would pay that bill. goldhill summed up his world view in an article in "the atlantic," how american health care killed my father. he said if patients spent more of their own money on health care, prices in the industry would come down. >> your basic argument is the whole idea of using insurance to pay for health care is wrong. >> the problem with insurance is that it's very costly. it's a very costly way to finance anything, which is why it's never used to finance anything outside of health care that isn't major and rare and unpredictable. i think if you look at the health care system, what you see

is a system that lacks any of the normal disciplines we see in everything else. >> so give me an example of some place where you find market forces can actually work the way you're describing them? >> well, you know, around the fringes of health care, we have things that look like health care that aren't in the health care economy. they're not insured. we see that in certain types of cosmetic dental surgery. in cosmetic surgery generally. we see it in medicine for pets. and what we see in all of those markets are markets. >> take lasik eye surgery, for example. since the procedure was introduced, prices have dropped considerably, despite all of the expensive equipment and well-trained specialists. lasik doctors actually compete for your business, with ads that tell you about their safety record and prices. >> ask a very simple question of your viewers. how many of them know the safest hospital in their neighborhood? why not? why is there nobody with a billboard saying, don't go to downtown, go to uptown. downtown will kill you. we've been through 45 years of

turning over our power to insurers, medicare, and medicaid. look at the result. >> goldhill's solution. insurance should only cover catastrophic events, serious illnesses, like routine care should be paid for from a health savings account that each person controls. the poor would get government subsidies for their accounts. >> we have to care about the costs, because what we're doing in medicine is destroying the american dream. >> dr. gowandi is the author of several best-selling books on medicine. he agrees with goldhill that the market in health care isn't working, but he says there's an important fact to consider. >> the sick account for most of the costs, 5% of patients are 50% of the costs. and these are folks for whom the bills are $40,000 and $50,000. >> under goldhill's solution, limiting insurance to catastrophic events and serious

illnesses, insurance companies would still be paying for a lot of our health care costs. figuring out how to treat the sickest of the sick, gowandi says, is the trillion-dollar question. >> the average patient who's elderly on medicare has more than ten specialist physicians by the last year of their life. and if you've ever taken care of an elderly parent, you know how much you want to tear your hair out that they just won't talk to each other. >> what the country needs is a more coordinated approach to care. some doctors tend to prescribe too much medicine, he says. that's less efficient, but it is more profitable. >> we have focused on getting the best drugs, the best devices, the best specialists. we think very little about how we fit it together so it works well. >> what is wrong with prescribing lots of procedures? i think americans think of this as a case where, with surely, more is better. why not have more mris? >> yeah, more at the right time

is better. but, you know, we're doing 70 million ct scans in a population of 300 million people. we know ct scans cause cancers. and second, doing more of these kinds of tests end up raising, maybe there's a spot there, maybe there's not. that lead to more surgery and more risks. >> a more coordinated approach to care may reduce needless testing and lower costs. president obama's health care law encourages more coordination, giving funding to providers to come up with more efficient and effective ways to provide care. >> the concentration on the 5% of patients who are the highest cost patients and how badly we take care of them is unleashing enormous innovations, enormous reductions in costs. i think we're about to enter a period of very rapid change. >> when we come back, we'll show you a bold example of that change.

a health care experiment being conducted in one of the roughest cities in the country, and it's working. with the spark cash card from capital one, olaf's pizza palace gets the most rewards of any small business credit card! pizza!!!!! [ garth ] olaf's small business earns 2% cash back on every purchase, every day! put it on my spark card! [ high-pitched ] nice doin' business with you! [ garth ] why settle for less? great businesses deserve the most rewards! awesome!!! [ male announcer ] the spark business card from capital one. choose unlimited rewards with 2% cash back or double miles on every purchase, every day! what's in your wallet? or double miles on every purchase, every day! an accident doesn't have to slow you down. with better car replacement available only with liberty mutual auto insurance, if your car's totaled, we give you the money for a car one model year newer.

to learn more, visit us today. responsibility. what's your policy? [ male announcer ] aggressive styling. a more fuel-efficient turbocharged engine. and a completely redesigned interior. ♪ the 2012 c-class with over 2,000 refinements. it's amazing...inside and out. see your authorized mercedes-benz dealer for exceptional offers through mercedes-benz financial services. a little bird told me about a band... ♪ an old man shared some fish stories... ♪ oooh, my turn. ♪ she was in paris, but we talked for hours... everyone else buzzed about the band. there's a wireless mind inside all of us.

so, where to next? ♪ [ male announcer ] for our families... our neighbors... and our communities... america's beverage companies have created a wide range of new choices.

developing smaller portion sizes and more low- & no-calorie beverages... adding clear calorie labels so you know exactly what you're choosing... and in schools, replacing full-calorie soft drinks with lower-calorie options. with more choices and fewer calories, america's beverage companies are delivering. i'm don lemon. here are your headlines this hour. people in states around the country are learning to deal with the wrath of mother nature. utility crews are trying to restore power in areas struck by friday night's deadly storms in

the northeast. a lot of those outages are in the same places suffering from blistering high temperatures. 20 states issued heat warnings or advisories on sunday and nearly 2,000 high temperature records were tied or broken around the country. in colorado families are getting their first look at what remains of their homes after a deadly wildfire tore through the neighborhoods of colorado springs. roads were opened for several hours allowing families to cautiously examine what's left of their homes. the area is under a red flag warning, which means there's a chance a fast moving fire could flare up again. mississippi's only abortion clinic will remain open for now. the clinic owner says a mississippi federal court judge has issued a temporary restraining order allowing the clinic to remain open until july 11th until a hearing on that day. the clinic was facing closure under a new state law that took effect on sunday. those are the headlines this

hour. i'm don lemon keeping you informed. cnn, the most trusted name in news. skyrocketing health care costs have created what some say is one of the biggest economic bubbles in american history. doing nothing could lead to dire consequences. that's why some providers are experimenting with innovative approaches to health care before it's too late. >> we're spending a whole lot in our country for health care and not getting our money's worth. and that's a tragedy. >> dr. jeffrey brenner is on the front lines trying to reform a health care system that has been called hopelessly broken. >> we spend twice as much at other industrialized countries and we cover fewer people in our country. >> brenner is tackling this disconnect in camden, new jersey, one of america's poorest cities. he's been a family physician

here for 11 years. his mission started on this street in 2001, with a gunshot. an unremarkable sound in camden, which has one of the highest murder rates in the country. >> i was sitting at my desk one evening and shots rang out. >> brenner ran outside, where the victim was lying in a pool of his own blood. no one was doing anything. >> i started yelling at one of the sergeants, you know, why didn't you do anything? and he said, well, we didn't want to dislodge the bullet, which was a complete blowoff, and just showed such lack of compassion and lack of concern for sort of the dignity of people's lives. >> the victim was a remarkable product of camden, a senior at rutgers university, who had talked about running for mayor one day. his death triggered a passion in brenner to reform the camden police department. but he says it was mired in dysfunction. >> i threw my hands up and said,

i give up on helping to reform the police department in camden, but i think i can take a lot of the ideas that i learned in the process and bring them to health care. >> brenner had been mapping crime data to locate the city's most violent corners. just like the new york city police department did in the '90s, producing great success. so he started mapping health care spending, identifying hot spots, where the costs were the highest. using medical billing records, brenner found the that just 1% of the patients accounted for 30% of health care costs in camden. and that's not all he discovered about the city's three hospitals. >> we learned that someone went 113 times in one year. someone went 324 times in five years. in similar work up in trenton, they found someone who went 450 times in one year. >> these were people with complicated medical histories and chronic illnesses.

one patient alone racked up $3.5 million in medical bills over a five-year period. >> they are the difficult patients to treat, and no one is being paid and incentivized to pay attention to them. >> what's more? camden's problem is america's problem. just 5% of the americans accounted for half of our nation's health care costs in 2009. this is perhaps the crucial statistic to understand about america's health care problem. if brenner could crack his city's cost crisis, maybe his model could help the country. >> we've met with his primary care doc. >> he founded the camden coalition of health care providers, a group of nurses, social workers, and volunteers, who treat the city's worst of the worst, one patient at a time. >> and i'm going to visit with her today. >> every day the group gets data from all of the city's emergency rooms, in realtime. that's the first time this has ever happened, anywhere in america.

>> it's a nice day for this. >> jason, a former teacher and registered nurse, is making a house call to 52-year-old lilian perez. she was admitted to the hospital eight times last year, literally for respiratory distress. she has a bucket full of medications for sleep apnea and other conditions. jason and his colleagues got a ventilator placed in her home. >> that's the new ventilator. >> i got what i need to live. >> she saw her pulmonologist who only has seen her in the hospital every couple of months. they said, we haven't seen you in a while. you look great. >> lilian has stayed out of the e.r. for 70 days and counting, a record for her in recent years. but some are hard to reach, they don't have phones, so jason and

his team do routine drive-bys to see patients like earl. earl is one of the biggest e.r. useders in camden. along with a host of social issues, earl suffers from epilepsy, hypertension, and congestive heart failure. >> trying to make it through another day, you know what i'm saying? >> the three amigos came early. >> the three amigos, that's the term earl uses to describe the team that visited him earlier in the day. >> i know you're busy. >> despite the long odds, earl's hospitalizations have decreased by 30%. brenner found that many expensive patients like earl were concentrated in certain areas of the city. one building alone, a subsidized apartment tower, accounted for $12 million in hospital costs over five years. >> and the patients were appalled that someone made that much money, and yet they still

felt so sick and they still felt like it was so hard for them to access services. >> so brenner set up a clinic right in the building, so that the residents can get preventative care. >> this is not a story of bad patients, bad doctors, bad hospitals, and evil insurance companies. it's a story of a broken system that has irrational incentives and misaligned incentives, so that the patients aren't getting their needs met. >> check his height, weight, and i'll be back. >> brenner says that early evidence suggests his experience is working. hospital use is down for participating patients. his model is being replicated in trenton and newark, two other new jersey hot spots. these programs are bolstered by new legislation that rewards caretakers for preventing and controlling illnesses instead of just treating them. >> it was signed last august by government chris christie, with bipartisan support. >> rather than a cycle of failure in health care, it creates a virtuous cycle, where

we're rewarded for doing the right thing. >> now, here's the problem. brenner's coordinated approach to reducing costs is essentially taking away patients and business from hospitals and doctors. that threatens the profits of most of the established players in health care. when we speak of reducing health care costs, remember that for many powerful interests, that translates into taking away my business. but if brenner does succeed in bending the cost curve here -- >> it would make the rest of the country look silly if the city of camden is able to improve quality and reduce costs. and it really shows this is not a technical problem, but it's a spiritual, political, and moral problem. >> when we come back, i'll give you my thoughts on the health care debate. stay with us. ♪

[ male announcer ] ok, so you're no marathon man. but thanks to the htc one x from at&t, with its built in beats audio,

every note sounds amazingly clear. ...making it easy to get lost in the music... and, well... rio vista?!! [ male announcer ] ...lost. introducing the musically enhanced htc one x from at&t. rethink possible. so how much do we owe you? that'll be $973.42. ya know, your rates and fees aren't exactly competitive. who do you think i am, quicken loans? [ spokesman ] when you refinance your mortgage with quicken loans, you'll find that our rates and fees are extremely competitive. because the last thing you want is to spend too much on your mortgage. one more way quicken loans is engineered to amaze. ♪ one more way quicken loans is engineered to amaze. see life in the best light. outdoors, or in. transitions® lenses automatically filter just the right amount of light. so you see everything

the way it's meant to be seen. maybe even a little better. experience life well lit, ask for transitions adaptive lenses. visit your local sam's club optical today to discover how authentic transitions brand lenses enhance your vision. sam's club. savings made simple

after taking this tour of the globe and america, what is the best way to reform american health care? i'm reminded of the old irish

joke. a couple is lost in the irish countryside and stops to ask a local the best way to get to dublin. well, i wouldn't start from here, he replies. america's health care system is really a mess. it is partly free enterprise, partly state subsidized, and overall, highly inefficient in delivering quality care at a reasonable price. let me step back before making specific suggestions and outline a few general principles. i'm a big fan of the free market. i think it has an almost magical ability to allocate resources and generate growth. but precisely because it is so powerful, in places where it doesn't work well, it can cause huge distortions. the nobel prize winning economist kenneth arrow outlined in the 1960s why markets don't work very well when it comes to health care. he explained that people don't

know when they will need health care and that when they do need it, the cost is often prohibitive. that means you need some kind of insurance or a government-run system. now, if we decided as a society that it is okay that when people suddenly discover they need health care, they can get it only if they can pay for it, that would work. but it would mean that the vast majority of americans wouldn't be able to pay for that triple bypass or hip replacement when they need it. the market would work, just as it works for bmw cars. people who can afford it can get it. people who can't, don't. but every rich country in the world, and many not-so-rich ones have decided that all citizens should have access to basic health care. and given that, a pure free-market model simply can't work. and remember, even if one were to have only a catastrophic insurance model, that's where all the costs are.

just 5% of the patients in the united states account for 50% of the health care costs. and taking care of these catastrophic illnesses is what drives america's costs up. now, a general insurance system can only work if everyone is insured. that's what the swiss and the taiwanese found out. otherwise, only the people who are sick will want to buy insurance, and insurance companies will spend most of their time and effort trying to keep sick people off the system or deny coverage to those who might get sick. that's why the heritage foundation, a conservative think tank, came up with the idea of the individual mandate, requiring that people buy health insurance in exactly the same way that people are required to buy car insurance. that's why mitt romney chose this model as a market-friendly system for massachusetts when he was governor, and that's why newt gingrich praised the massachusetts model as the most important step forward in health care in years.

the obama health care bill now upheld by the supreme court expands access to 30 million americans. that's good economics, and it's also the right thing to do, but it does little in the way of controlling costs. there are several experiments and pilot programs in it. there are new trends emerging, such as the one we saw in camden. but retail in the way of systemic cost controls. that's largely a failure of nerve in the entire political establishment. every expert realizes that no matter what the system of health, you need to have some kind of board that decides what's covered and what's not. now, this has been demagogued as death panels. when it is really the only sensible way to make the system work. no one is saying that you can't get nay medical procedure you want. merle that there are some that your insurance won't pay for.

the other unusual aspect of health care, kenneth arrow points out, that buyers really don't have much knowledge or power. you can decide you don't want a new car. you can comparison shop for a new tv. but you can't really decide that you don't want a heart bypass. that's why costs have come down in optional areas like, lasik surgery, but not in ones where the consumer really can't walk away. a final thought. one can reason from first principles, and that's a good thing. but you must also reason from facts on the ground. and the facts are that all rich countries try to provide affordable health care for their citizens in some way or the other. all of them, including free market havens like taiwan, have found that they need to use an insurance or government sponsored model. and all of them provide universal health care at much, much lower costs than we do.

maybe there is a theoretical free market model out there that would work perfectly. but right now in the world that we are actually living in, some kind of mixed, messy health care system is what we have, and our task is not really to abolish it in favor of a utopia that might come, but to improve it, so that americans can get good care at reasonable prices, like so much of the rest of the world. thanks for tuning in to this gps special. you can read more of my thoughts in "time" magazine and you can always catch my regular show on sundays > and tonight, oliver stone gets prickley about my questions.

>> english always do that. they don't ask this on american television. >> he does talk about the war on drugs. >> it doesn't go away. >> and his new movie. >> that's part of the deal, buddy boy. >> there's a lot of twists. it's a wild ride. >> and the world of green since he made wall street. >> the banks were doing what they were doing in the '80s. plus, his unforgettable past. what was the greatest -- >> i have been through so many. i'm lucky, you know. >> and now mark wahlberg is back with his latest project. >> >> i got to get to work. i don't know if i can drive. >> i will drive you. i will feel fine. >> it's as racy as ever. >> i don't know if you can say it on primetime cnn. >> we will just have a slew of bleeps. >> i apologize. >> one thing you thought he would never see him do. >> she says, we're okay talking about it? i said, sure. good evening. a big story tonit.