prepaid health act and from their perspective that's wrong. we would like that choice but because of prepaid health we can't provide that. >> thank you for that perspective. obviously, i have to think about it a little bit more. for some of the other panelists, i think from what i know about the private healthcare insurance system there's really a lack of transparency. for example, i don't know of any state that requires the health insurers carriers to file their rates and justify their rates. we do that in workers' compensation and for those states that have no fault auto insurance of prior approval. there's really a lack of transparency. .. specific

language requirements that addresses the waste that is in the system currently. >> the bill as drafted has a number of elements of what we need to have a national, effective strategy for addressing quality problems and improving the delivery system. it is not as well integrated or robust as it could be. we had discussions over the weekend with some of the staff about this. needs some work and one of the things that is really important is that currently we have a consensus -- is not mandated by h h s, it is developed by the national quality forum.

this has the representation of all the people who are moving up to the position in the organization, a hospital organization. if we are going to get the kind of change we want, the people who deliver care have to be brought into this and they have to have their $0.02. that is a process that needs a strong place in the bill and in the draft. >> they agree, dr. hacker? >> you are absolutely right to emphasize the benefits of transparency in this process. it is the case that we know about this 30% precisely because medicare has collected this information and made it public so that researchers can use it. the studies that have been so influential are based on medicare data. the starting point, a commitment has to be towards greater availability and the kind of information we need to make these judgments. we often understand the public

plan, quite rightly, as a way of providing secure coverage. it also needs to be on the forefront of improving the delivery and quality of care in conjunction and coordination with a private insurance plan. these public/private partnerships that mr. shea mentioned. what hasn't been mentioned as president obama has rightly said the medicare facility, payment advisor commission should play a in role in improving medicare paying for certain services more efficiently and i believe medicare and the new public plan should be doing a better job encouraging the right care and quality care rather than more care. >> i want to say that as we move toward a national standard is important that these standards acknowledge differences based on race, american indians, thank you.

>> thank you, mr. chairman, in my opening statement i did something you never do and that is misspeak. my final comment in the opening statement is there are positive solution to the challenges we face and i am hopeful the house will allow for an open, vibrant, robust debate and a deliberative process that respect america's doctors that most of all, america's patients. we have heard less talk about the patients specifically than i had hoped. there is a lot of common ground in health i tee, wellness and prevention. i want to have folks address, if you would, one of the comments from my opening statement, if this grandiose plan comes to hal sutton, and if there are some americans who believe it is not addressing their healthcare needs, and if they want to go

visit a physician of their choosing and decide they want that physician to treat him or her for a specific illness or morality or problem, should they have the right to do that outside of the structure, mr. pollack? >> they should have that right. they may be required to pay an additional amount of money. >> if they want to use their own resources they ought to have that right? >> i do believe that. >> are you aware that isn't included in the present bill? would that give you pause? >> most health plans, even things like epos, we can go outside the network. i assume there will be retained. >> mr. scheck, you agree with that? does anyone in disagree americans ought to be able to opt out fifth they so desire?

i was always frustrated when someone stepped between me and my patient and said you can't do that even though i felt it was in the best interest of the patient and the patient clearly trusted that decision. the comparative effect of this research on this new health choice panel that is in the bill, there doesn't appear to be any language that provides a for society is to be the final determinant of what is quality and what care ought to be provided. is that something you believe to be important? >> as i read the bill, as the health benefits council would provide some recommendations concerning what would be in the standard benefit, that would go to the secretary and that does not mean that somebody can't get

care, that might not be included as part of a plan. that happens today. >> that language is not in the current bill as it relates to the government option. >> i am not sure i follow. >> the final determinant of who decides what care to be provided -- >> there is nothing in the bill that says that somebody is going to make a decision, clinical decision, about what care you receive. [talking over each other] >> i would respectfully disagree. i would hope that what we could agree upon is that language itself needs to be in the bill, clinical decision ought not be provided by the comparative research council, health benefits -- >> i don't think anyone disagrees with that. an insurance company decides -- >> exactly. that is wrong. >> that, some might say, my come

between a clinical decision -- >> without doubt. >> you will know what your coverage is but nobody is going to tell you you can't get this procedure or that procedure. >> i look forward to your support for that kind of language. it is already there. please show me where it is. as we move forward, i look forward to talking to you about it. actor hacker, you talk about there is no worry about crowd out if there is a government auction, medicare part b -- >> yes. >> it is a voluntary program, voluntary program, what percentage of the market share does it hold? >> the market share of medicare part b is 99% of all the americans. >> that resulted in crowd out of

other private entities that would have provided health coverage for seniors if they had been given an opportunity to without the subsidies place in medicare? >> medicare part b is a false voluntary program in the sense that 70% financed by general revenue at the time was created, there were very few private options. what we are talking about is the public plan choice, an option available only to people within the exchange that there would be no subsidies for general revenues. they are not analogous at all. >> i would agree at the beginning of this bill but over 5 years, everybody comes into the plan as defined by the government through this bill as originally constructed and that is a concern many of us have. >> i understand the concern. is not a valid concern. i tried to explain why because it is important to understand that first of all, many people will want to be in a private

plan, many private plans are offering an innovative alternative to what the public plan would be providing, third, most people would still get private coverage through their place of improvement -- employment under this legislation and forth, i argued that the bill embodies this argument, this should be on a level playing field with no special treatment for the public plan versus the private plans. >> i would suggest, mr. chairman, that that is not what is incorporated in the bill. i hope that is what the final product will be but right now that is not what is in the bill. >> thank you, mr. chairman. i am not a physician, i am not an attorney, i am a for her--former clothing worker, i worked in suits and factories for 20 years but i am trying to look at this from a common-sense perspective. toucher hacker, you said 72% of americans support a public auction. >> there was any reason new york

times/cbs poll. >> so almost three force supported public auction. >> 83% supported it. >> i do too. count me on one of those 72% of the people and will grow larger when they find out about it. what i find interesting us about all this, i am not here to defend the trial attorneys but i was at my doctor's the other day, he has been an internal dr. for 20 years, never had a malpractice suit filed against him. his insurance rates have quadrupled in the last 3 years, never had a claim. spoke to another doctor who had a claim filed against her in 18 years, said it was frivolous, her insurance company told her to feet it out because it was easier and would take too much time to go to court. if we are going to be up on one

end of that we should look at the other end. usually under automobile policies, if care driving safely, you discount safe driving. a doctor was told by the insurance company to plead out, why don't you do it? that is the equivalent of my going into a store, walking out, being accused of shoplifting when i didn't do it and my attorney says you don't want to take time off from work. reputation is at stake. we need to take a look at that aspect of it too. the reason i support as public option. i want to ask mr. shea about this, we heard about the wonders of medical savings accounts. i don't know how people can save money when they are barely holding on to their homes, their hours are cut, then we hear about what a great thing it is. isn't it true that the vast majority of people in health savings accounts are wealthy people? they are not middle income people, are they?

or am i missing this? >> the assumption that medical savings accounts are going to save this country money on health care is a mistake. the overwhelming majority of costs in our health-care system are for major interventions. it is not at the front end. if you create higher deductibles, it is not going to save significant money for america's health-care system. it might prevent people from getting preventive care, from getting tests, from getting initial examinations. that is of mistake and i think is a mistake to provide tax incentives that are clearly regressive because of higher the tax bracket you are in, the higher the tax benefit you get from a medical savings account. it turns out that those people who tend to opt into a medical savings account are somewhat wealthier and somewhat

healthier, those who are wealthier are not so worried about a high deductible, it is not going to phase them out all. those people are less wealthy, it is going to phase them and the wealthy person is in a higher tax bracket, is going to get a higher tax benefit. i think it is a mistake to go in that direction, it won't save money, it is regressive, and it is not an incentive to get in the preventive care we should be encouraging. >> i want to ask about the affordability because my time is nearly a. i met a couple whose son worked in illinois in a factory that closed, he had 9 years -- nine years, it shut down, he went to work part-time, died at 31-year-old because he had a heart attack and had no insurance. his parents said to me, the press asked him -- god didn't take my son, made a special place, the government did because they did not have an insurance plan that would cover

him when he lost his job and went to another. under this bill, he could have gone into the public system. how do people who lose their jobs, how are they going to afford if we don't have a public plan, how are they going to afford health care plan? are these benevolent insurance company's going to hand it to them and charge them basically nothing? >> we just released a survey, an online survey, 23,000 people responded, it is not scientific but 23,000 people, 6,000 people rode their individual stories, one of the phrases that kept coming up was i lost my insurance, never knew about it, people say i am now on the faith based plan. i pray i don't get sick. what we need to focus on is basic health security.

let's get the trains running right, which they are not. if we want to talk about bells and whistles, that is a special story. we don't have the basic. >> thank you, mr. chairman. i have been listening to this battle which has been excellent, and obviously i have been reading and studying this as well as the rest of us. my concerns are almost increasing rather than diminishing. when i look at the cost in the health-care system, when you look at the cost of prescription drugs, you can argue with the reasons for that maybe, or take the prescription part the plan and close the doughnut hole or medical inventions, and procedures which are going on,dd close the doughnut hole or medical inventions, and procedures which are going on,

becoming more and moexcessive, there are 3 -- medical schools are usually losers for universities, it is a high-cost item, medical malpractice costs which are not doing a lot about in this particular legislation, the insurance rates. the salaries of medical personnel, those running hospitals or whatever it may be, the idea of adding affordability and pre-existing conditions to existing health care plans in this country, i look at medicaid and medicare, and how they are driving the budgetary situation in this country into a corner in terms of where we are going, even worried about the costs of health information technology, which ultimately is something we need to do, might even be helpful in terms of saving money

but the initial cost of it is so great, i worry about the cost of the public option, there will be a lot of back room costs. i believe in a lot of a concept i am hearing about. i would love to see everybody in short in some way or another, abbey's provided health care in some way or another but i'm worried we are biting off a lot here. i have seen the estimates for the senate plan, i am not sure what the cost of these plans are going to be, but can we afford it are we going to make a political decision, we're going to pay for it. i hope as a committee as we listen to expert witnesses as we put this together, we are being thoughtful and careful about what we are doing, maybe we have to do something less than the

grand approach in this situation so it will be a manageable circumstance and we have to continually look at every single cost savings component we can in terms of how we are dealing with any of these issues. i will be happy to yield back my time. as one member on this committee, i do express concern about where this is going to end up. we always need to know the details on how we are paying for it. >> thank you, mr. chairman. everybody has walked away without much of a fight would surprise me for a number of people on the panel and others. we are looking at how we are going to try to make this -- when i talk to people, when they find out the size of salaries of private insurance companies, they find out the amount of

money being spent, the size of the profit, we have to do something to make people that are paying health insurance premiums think they are getting something for their buck if they're paying to help other people getting short. it seemed to me the idea of the medical loss ratio is something we should consider, to make a reasonable number. mr. hacker, what do you think of that? >> one reason to have the public plan is to address those concerns. it is also worth noting that while there is no intention in this public plan to have medicare for all system, the virtues of having met system are cheap by having a competitor in the market in this exchange that embodies those values, putting patients before profits, making sure people have broad coverage and making sure the focus is improving care and innovating

overtime. >> that sense of competition may eventually bring some sense back to the premiums, usage of private companies, why don't we initially require that we get into the exchange or whatever you're going to call it, why shouldn't they have to meet some particular level as the consumer that we have to spend a certain number of premium dollars on direct medical care? >> there is a medical loss ratio standard. >> i know who put it there. do you agree that it ought to be there? it is that a rather low number. >> it may sound very low but as you well know, many insurance companies spend less than 85% of their income on care. even within medicare advantage plans, there are many cases where they are spending 82% or

83% of their spending on actual delivery of care. >> usa families today, people do far less than that, some do 60%. >> some of them go as low as 60%. >> the only point i am trying to make, i am not trying to be sarcastic, it is ridiculous that we're word, we're worried about public option plan, by put these private companies of business or they won't make enough profit. what should be our party concern is making sure we get the best deal for the consumer so they get health care and a premium dollars spent on health care, i don't care if the united states chamber of commerce or the labour unions or anybody else, all members want to get a decent deal on this and all of them are outraged at the high salaries the executives make and the amount of money spent on marketing and the amount of money that goes into not just profit but outrageous profits, i don't understand sensitivities of all of us around here about being so concerned about their existence and their ability to keep on doing that to the

consumer. if we are going to walk away from single payer, that disturbs me considerably, at least we ought to fight to make sure they participate in the exchange which is a benefit to them, they ought to at least give something back to the consumer and not be allowed to continue to do that. if you want to respond to that, fine with me. >> i was sitting back and saying well said. the other thing i would say is we have to realize that these costs are not just at the highest level, not just with advertising or marketing, as i would consider them. they have to do with the basic relationship between insurance companies and the people providing the care. there is a great example by the boston globe of the relationship, usually these

things are not revealed, the biggest system in boston, we need public service organizations. they may be private companies, but they claim to do a public service. we need them to be watchdogs, not lapdog. you are exactly right. >> i don't think anybody was satisfactory about it, we have to hear a description of what foul you at insurance companies direct patient care. what do they bring to the table? how we move patient care forward? >> the best insurance companies have been able to innovate and provide high quality care and good customer service to their patients. insurance companies have incentive to engage in the kind of practices mr. shea

talked-about, passing costs to consumers. you have to abide by the strict rules and have to compete with public service or public health plan on equal terms. they can provide the kind of innovation, customer service for delivery system benefits we have seen. >> is a hopeful experience. >> just a couple things. you are wrong about who would have that plan. i daresay the people working in doctors' offices consider themselves wealthy. those are some folks that have those plans. just a comment, having practiced medicine for 30 years let me explain, and you get malpractice strained out, you have a

difficult time controlling costs. you came into the emergency room 30 years ago, i would examine you and say let's get a blood count, that costs $25, temperature and physical exam. come back if you are not feeling better. when you coming, you would get a cat scan because that is the standard care to diagnose. that is a $1,000 tax as opposed to a $50 emergency room visit and if you don't do that, you are going to pay. access to this technology and into the legal climate has created this, unless you get meaningful reform, doctors are going to be a narrow self-interest and if that is -- if they are sued they will get all the documentation they can possibly get their hands on to prove they didn't do not practice. i am pointing that out as a

gimmick. it is very important, and one of the reasons i am concerned about this government plan is you are absolutely right, patients and doctors should be making decisions, not health insurance companies or public plans. let me give you an example. when i began my practice, 50% of women died of breast cancer when i started practicing. it didn't matter, the results were the same. we have a 90% survival rate, that is a wonderful thing when a patient comes in to tell them you're going to live through this awful disease and we are seeing a new breast cancer every week. in england they quit doing screening mammography because the biopsy, the false positive rate of the test, that says you

have something when you don't, radiologists cost more than screening, so they are -- the comparative effectiveness mated decision not to continue to do routine mammography. i would argue screening mammography and mammograms with patients indication raised this level of survival. the way they all work, at the end ofhe point latin they rationed care. they have so many dollars spent on health care and after you spend those dollars, rates occur in canada, great place, it takes 117 days to get a bypass operation. this is not fill row talking, this is the president of the medical association. if you get your hip replaced in a week, it takes two or three years to get your own hip replaced.

my concern is the bureaucrat based -- making the decision based on a budgetary number, not the patient and doctor. i am not here to defend private health insurance companies. i can promise you when i was a young doctor, providing health care, they are there to make money. >>, and? >> what i would like to say is what we want, what patients what is care based on evidence. that is what we want. i didn't mean to say the decision should be made solely by patients and doctors. i didn't mean to say the decisions should be made by insurance companies. what we want is a system that supports decisions based on a high level of evidence or interventions that are helping us get evidence. that is out should work. it does not work that way now. a significant percentage of care isn't based on a high level of evidence and those are decisions that are unfortunately often made by physicians.