for granted, otherwise we are going to be in a world of hurt, nov. press about you're going own a book tour pro moiting right now while serving as chairman. guest: i wrote this book and you know in 2008 before i became chairman. and due to publishing circumstances at that time, and then, you know, got into the chairman's raise, it didn't get published so the reality is i updated it to include things that have happened since then. then of course, sarah palins book came out and you didn't want your book on the shelves when that hit so this is something that's been in progress for a long time. i think it's an important way forward. i really do. i see it's a blue print to move forward. taking important steps. saying we have a br problem and owning them.

we're the conservative party in the government. to try and stop the liberal, democratic party is a good political exercise and this is one way for that. host: marilyn geewax is author of, right now, a 12 step program for defeating the obama agenda. first up. republican line? caller: good morning mr. steel. i'm going good. i'm a small businessman. been in business 34 years and i'm one of the 70 percent of the population or businesses that generate the jobs that everybody talks about and all they talked about as far as initial >> caller: and all they talked about as far as in this administration is found a way to borrow money that i can't pay back in order to grow my business. my problem is my customers don't have jobs, or they are not spending money. >> right. >> caller: that's probably the problem that small businesses, we are not doing the business.

because our customers are not spending the money because they don't have it. now we talk about polls, it's conservatives, democrat, and independents. the last poll i saw, we had 40% of the nation is conservative. and 36% is independent. that bothers me that the republican party now doesn't even go into the polls? >> well, i think that's the point. you know within we're kind of getting blocked and tackled out of the frame. our responsibility right now as leadership, political leadership, national chairman, state chairman, activist around the country is to figure out how we begin to put ourself back on track. i said from the very beginning, the way you do that is to talk about those issue that is are attacked to our principals. if we are a party that believes firmly, as we do, in key iting a

pathway for entrepreneurism in this country, let's talk about that. let's fight for the fact that this is not the way you grow jobs into what obama and nancy pelosi and others are doing on the hill. how do you do jobs with layering and regulation and taxes? so why don't we cut the capital gains? eliminate it. zero. get hid of it. why don't get cut the unemployment or at least give a break in time for small business owners to be able to regain their fiscal strength. why don't we create real pathways for access to credit and capital without a lot of strings attacked to it. there are proactive steps that can be and should have been taken to get small business owners back in the game. because you are absolutely right. you are the one that's going to turn this economy around. not these institutions and government. and if we don't trust you and

have faith to do it done as we have in the past, everybody is going to be looking for government. that's not the way. >> host: bob, you are on with michael steele. >> caller: hey, bob. good morning. mr. steele. >> good morning. >> caller: you know, in case you didn't know, rachel not officially is writing you on your show. i hope you go on. you can go on her show and demonstrate due to public how to officially deck strait how to tea bag a person. get up on the table and do it. >> host: we will move on to tom. we try to keep this a civil conversation. please don't call in if you want to make crash remarks. independent line. please go ahead. >> caller: good morning. >> good morning, how are you? >> caller: i go two real quicks questions. i'll take the answer. first was, when you were running for senate, back in '08 --

>> uh-huh. '06. >> caller: '06, i'm sorry. did you not have a democrat bumper sticker on your car? and number two question, -- >> no. >> caller: why after criticizing rush limbaugh pretty severely one day did you do 180 degrees the very next day and apologize to the gentleman? i can't understand either one of those? >> host: tom, before we get an answer. who did you vote for in the senate race in '06? >> caller: the incumbent? >> there was no incumbent. it was open. the incumbent had retired. there was -- i don't have bumper stickers on my car. and i certainly wouldn't have a democrat butcher sticker on my car. with respect to rush limbaugh. there was no need to apologize,

because there was no office taken. >> host: is rush included in right now? >> in the book? >> host: yes. >> no, i don't concentrate or focus on personalities at all. why isn't sarah palin in the book? >> well, this is not about an individual or personalities within the party. this is about our party. this is about those of us who are out here fighting every day to grow the party. in fact, the book is dedicated to the grassroots. to everyone who has licked a stamp or stuffed an envelope and had a roll to play. so this is very much a grassroots book, written from a grassroots perspective. that's how i began in the city. you haven't lived until you go into some neighbors. hi, i'm from the republican party. click. it's tough. but it's important work. and a lot of people do it every and i'm very grateful for them

for it. >> host: we have a teeth. mr. steele, expectations of the upcoming tea party convention with former gop vs vp nominee sarah palin as headliner? >> that's going to be exciting to watch. i unfortunately have not gotten all of the background. but i expect it's going to be a cross section of america coming together to express their frustrations, but also their aspiration that leadership will do one thing and one thing. that's listen to them. listen to them. and that's something that i've tried to emphasize in my book right now is listen. my mother used to tell me as a little boy, first thing you have to do is shut up and listen to people. when i ran for office, with my good friend, we took the time to listen to people. that's what these folks are going to be gathering, ultimately going to want to hear and want to see. whether or not leadership is going to listen to them.

i think it's going to be exciting. >> host: baltimore, gary on the republican line. you are on with with michael steele. >> caller: good morning, mr. steele. i want to take a moment to thank you for the work that you are doing. there are a lot of republicans that have been in the fence and we really appreciate the work that you are doing and your the direction. all of the effort and elephant. my question is this, in the next round of elections when hopefully we do get more control back that we are not going to be the party no and continue to push health care reform. there is a lot of good work that needs to go on there. although what we are seeing isn't the best route, i want to hear we are going to continue fighting the fight? >> yes. you have to give enormous, you know, gratitude to the leadership in the hill -- on the hill who have fought valiantly to get those issues before the american people.

we've watched mitch mcconnell and john and the team on the floors of the house and the senate propose measure of measure tort reform. how do you do health care without tort reform? i don't understand that. small business pools, small businesses can pool their employees and get competition going in the insurance market. reforming the health savings accounts provisions to expand them to allow greater flexibility for individuals to save for their health care. there are so many aspects of what needs to be done in health care that are not in the bill that's before the congress right now for consideration. that we will continue to fight for and should our number -- we will be able to close the gap or indeed take control of one or both chambers. you are going to bet that we bring the issues back to the floor. >> host: do you see any similarities between this year and 1954?

>> that's a good question. there are aspects, but the environment is very different. the at a to do is very different. i mean you are seeing, almost like it's accelerated. newt gingrich and i were talking about this. he is such a phenomenal understanding of of, you know, not just history but where we need to go. and he was talking about how in 1994 they were able -- henned dick were able to bring the contract with america to america why september of that year. a lot of people think it was long. no, it was very short period of time in which it was part of the political discourse. now we are at a point where something like that is relevant. people looking. and they are hungry for what direction they are going to go and what the leadership is going to be doing and where the stakes are. this is a very much accelerated process this time. people are much more energized as we've seen over the past summer between town halls and the 9/12 event that took place

last september. there's a level of activism, a year out and two years out, certainly a year out from this fall's election that we haven't seen before. that's why i've been very direct with elected officials around the country. don't look past this. don't take any of this for granted. you better be calculated that people are watching your very votes and actions. and they are taking notes. and they will come after you if you don't get it right. >> next call for michael steele, gary indiana, randal, democrat 37 >> caller: good morning. >> good morning. >> caller: i have a couple of comments. i hope you hear me out. i have never been able to understand why educated people that there are black and white people. there are not. if the premise is wrong in the begin, the conclusion ultimately is always wrong. so i say that as a fact. i have never a black person and

i've never met a white person. these are political tools. let me say this, republicans have staged so many phony arguments over the summer from the president's birth, glenn beck, it's just been the political discourse has just been so phony around such serious arguments in the country. i can't even take the republican party serious as an alternative. even though i will say this, and grant you this, there are things that you say your party stands for that i do share those values. >> right. >> caller: cutting capital tax gain, helping small business. but because the political discourse is so phony. >> right. >> caller: do you understand what i'm saying? >> i do. let me address. i think he makes an interesting point. i do want to clarify when people hear something that is is in disagreement with the president

and, you know, people out there of all walks and political experiences and background, they kind of lump it all on the republican party. you know, if it a conservative or democrat, you don't know, did you say are you republican or democrat when you said that? but they assume it's us. so, you know, we get a lot of that back traffic. and that's fine. you have to deal with it. i agree with randal that the political discourse in the country right now, and i think he's a reflection of the attitude, can we talk seriously about this. can we have an honest conversation and debate about what are you going to do? i just lost my job. my business is about to close down. you want to be the governor of the state. you want to be the united states senator. what are you going to do to fix it? don't tell me that you are going to give me at program or this or that. let's be creative in our process. what i think the republican leadership has been trying to do is get those issues in front of the people to show this is what we think a better alternative

is. i think that's where people want to see the debate come down. what are our choices? what do you republicans stand for on health care? what are you going to do? i will go check off the list that members of congress propose or whatever. what i realize is a lot of it was they didn't know. we need to educate, we need to inform, we need to be out there in the community sharing the messages. but not doing it in the context that randal discussed, where you are doing hot rhetoric, making a lot of noise as james brown said. but really focuses on what people are trying to do. that's what chris and bob mcdonnell did. they talked to them about the issues that think were concerned about. people responded. >> ralph a couple of days ago had a report that some of the large donors to the traditional large donors to the rnc were not giving. they were dissatisfied with your

leadership. newt gingrich was voted as saying some old timers in the party are uncomfortable with you because you come from a different background. i'm paraphrasing quite a bit. >> i do come. i grew up in petworth here in washington, d.c. i'm an urban kid. i have -- i cut my teeth on the politics of this city with the likes of david clark and john ray, and eleanor holmes norton, watching them maneuver and fight for the city. my experiences are different than most states and certainly national chairman. with respect to, you know, our major donors. ralph e. boyd doesn't understand how it works. i don't know who he's talking to. but in typical fashion, a lot of things are gotten wrong. and the reality of it is if talk

to anyone who's quote a major donor for the democrat or the republicans, those individuals run businesses that got stocked by a recession that was one of the worst in 20 or 30 years. so they didn't have the resources, the extra cash, if you will, to play politics. and so there was a lot of slow down. and a lot of, you know, lack of access to those dollars to do the things that you would normally do. however, we have put in place some creative strategies to bring our donors back. and beginning in july or so, we started seeing a major donors coming to the table. and being a part of the game again. whether they were old timers or whatever, it doesn't matter. my goal is to create the environment so the people want to give and support the party. we're also targeting a lot of young donors and new donors who can help us and want to be a

part of this. last month we made our budget for our major donors who were 262% of budget. we were well in access of what we needed to raise in december, the same in november, the same in october. a lot of that is a rouge that some folks want to put out there to say, he can't raise money. but i raised $80 million. and i broke a number of records in fund raising through the course of the year. i have cash reserves when my predecessor had a budget that had $0 that the committee had. i think before people write stories, they need to maybe talk to me and get the facts right. we have been very proud of our donors who have given of themselves at a time when it was tough to give. i have respected those dollars very much. because i don't want to waste

them. we spent them wisely. we spent elections. we invested in the party with those dollars. and we saved. i was banking 50% on every net dollar on the door. i beat the democrats five or six months out of 12. how are their major donors? if they were doing well, i shouldn't be beating them. democrat or republican doesn't matter. these are individuals who have the wherewithal to give in. nay are concerned about the businesses and family like everybody else. politics becomes a luxury and they don't give or don't give as much. you need to find ways town -- to incentivize them. glm >> >> host: you're on with mr. steele. >> caller: good morning, mr. steele. >> good morning. how are you? >> caller: i'm a hospital. i'm sick.

i'm so glad to be able to talk to you. i have a few quick statements and a history from a different side that you are not familiar with. i was a tea partyer before tea partying was cool. i'm a conservative. i'm a constitutionalist. >> yes. >> caller: and for years, we were supporting ron paul and out there protesting against the taxes and all of this taking of our constitutional rights and so forth. and what happened was when it grew and began to get attention and the people started coming out, that was when the guilties began to see that obama was just like bush. >> uh-huh. >> caller: and i wanted to make a statement just quickly. the fact of the matter is, we were all patriotic, because we were real conserve tyes did not support the illegal war. iraq having nothing to do with 9/11. now we are still called unpatriotic because we don't

support obama. i want to tell you -- excuse me. i'm sorry so sorry. >> host: can you wrap this up? >> caller: yes. mccain is a republican. ron paul is a conservative. which means to protector our constitutional rights. >> well, i appreciate that. again, i think -- i hope you feel better, by the way. i think she reflects, again, a youing sentiment that's out there in the country that's reflected in a new kind of activism. as i said, it's accelerated. it's moving beneath our feet and the question becomes for both parties, are you prepared to move with it? how do you capture these moments? not capturing the individuals saying come join us, being a republican, be a democrat. but capture the spirit of what they are talking about. this constitution of ours means a lot to a lot of people. and while we may not jump up and down and we are -- wear it on our sleeves, it's not things we do. when we see it threatened our

undermind or being used in a way that is not reflective of its purpose, we become concerned. i think when you look at, for example, the fact that we're going to be trying terrorist here in the u.s. courts. that has real concerns to those who see the constitution being used to wrap around and protect the very men who want to destroy that document. and destroy the principals and the foundations of this nation. and so individuals like danny and others are very concerned. and leadership has to address that. you know, you can't sort of gloss over it and say, we're doing this to show that we're better. that we are up -- standing up to what we with say we are as americans. well, i don't think that does that. i think that that is looking at a national or international situation through a criminal justice system and not what it really is.

terrorist acts against the united states. and so you need to treat that differently. you do not give and in my estimation, and the estimation a lot of people around the country, people want to undermine the constitution to access to use it against us? >> host: if president obama gets health care legislation to sign and does sign it, will that be one the issues that you use in the 2010 election? >> absolutely. health care will be an ongoing issue until it's resolved in a way in which the government does not stand between the doctor and the patient. and that you are looking at a system where you are dealing bottom up. the reality of it is, you created a bureaucracy to solve cost problems. you know, so if cost is the issue, if that's the driver, then what do we need to do to address the cost, to bring those cost down. let's create greater competition in the marketplace so insurance

companies are not -- they are not only three insurance companies that you can go to in my state. oh, i it go to the four that are over there or the seven that are over there. you create competition. and you do other things. the other thing is if you have 40 million, 33 million, 10 million people who are uninsured, look at the systemic reasons as to why they are uninsured and begin to address that. that again does -- as the republican leadership has been saying for eight or nine months does not require a wholesale takeover of the economy. you got to figure out a way to bring those people in that consistented with your effort to lower the cost, does not increase the cost. and yet this administration wants to bring in 33 million people and has yet to tell us exactly how much it's going to cost and how do we pay for it? >> host: time for a couple more calls with rnc chairman

michael steele who's new book is called "right now: a 12-step program for defeating the obama agenda." >> caller: hello. how are you? i'm centralist with the right leanings. one of the things i like to do is watch the network, abc then nbc is second. and then i watch some of the fox guys and some of the cnn guys just to see how the tone is different. >> right. >> caller: back in the day, the news media tried to stay in the middle. even though you could tell they were leaning a little to the left, now it seems to me that they aren't even trying. they are pretty much entrudged in the left. i'm wondering how we can call them out and at least come back

to the mid until >> well, that's a very good question. if you figure it out that you dabble. let me know. it boils down to a conscience decision by the network or by the individual station in how they want to project the news. that is why you find, now, you know, folks relying on programs like this, why they have unadulterated access to conversation and they hear directly from individuals perspectives that they have not been exposed to before. and they go to the internet. they can then more freely decide where they want to go. if i want to see a particular piece, i can download it, look at it, and move on. i don't have to do a whole lot of other things. the media is going through an enormous transformation. the political parties are still trying to figure out what it means. certainly at rnc, we invest the

money to upgrade ourself with the new landscape. getting rid of web site and platform so we can connect people to events and issues. we can create the social networkings that are important to dear on the conversation and listen to what's being said. i think that we find right now, that while you have fox, msnbc, you have all of these other networks that are doing their thing, people are realizing, i have more freedom and choice here than a lot of people think i have. they are beginning to access it. i don't know if that will necessarily change the behavior of some networks, but i think in the long run it there. because they will want to be more of the spot that will draw people in. not just the ones that always agree with them. >> host: maryland. go ahead. >> caller: good morning, mr.

steele. >> good morning. >> caller: host, what is your name? >> host: i'm peter. >> caller: peter, i'm first-time caller. i was calling to ask him about the question he said listening to the people. if he listen why did him and governor ehrlich lose the race if he was listening to the people? he would have heard what they was calling for. that the republicans weren't doing the job that needed to be done for the people. for eight years they were in charge, more or less, and nothing was done about health care expect for the part d medicare, which they snuck through in the middle of the night. i watched it all night. i'm a democrat. but i listen to fox, i listen to glenn beck, kennedy, o'reilly, chris matthews, keith okayer

ton. i listen to it all. i didn't have the best of circumstances when i came up. i didn't graduate high school. but i went back and got my high school diploma and got a job. they sent me to school. >> right. >> caller: and the constitution says that i hear you keep talking about the constitution the constitution says this the constitution says that. the constitution never said that huh to have farming to take care of anybody houses, the constitution never said that you had insurance on cause if you want to have a cause. >> host: hey, james. we're just a little tight on time. what would you address michael steele to address? >> caller: why did they lose the race in maryland if he was such a great listener? >> well, you know, governor ehrlich and i did the unthinkable. we won after 40 years of having democrats in maryland, the last republican governor before ehrlich was sparagnon.

in 2002, the people of maryland decided they wanted to make a different course. i think when you look at governor ehrlich's record and certainly my responsibilities on the governor behalf and education and small business reform and certainly in dealing with the number of other issues, we met -- i think, what we were asked to do. and we were able to reach people and talk to them. we like so many others got caught up in the political climate of that day. s there was a general mood. anything republican was a problem for folks. which you have to understand, james, that governor ehrlich was retired for office from 62% job approval. and it had very little to do with what the governor was doing. but it had everything to do with the fact that people wanted to send a message to the republican party. he was the only republican governor that year to lose.

we are still a very democrat state in maryland. that wrong in 2006. but my hope is that the governor comes back. my hope is that the republicans come back and re-establish the opportunity for maryland to be a two had been party system where the voters get to decide and competition is a healthy thing. so governor erlich was not unelected nor did i lose the senate race because of our views on the issues. we did listen to the people and they responded. but i know the governor heard, i heard many times, i just couldn't vote for you. i had to send a message to the party. you know, that's what happens in politics. people find ways to get a message through. sometimes their casualties in that process. host: what would republicans do different this time? guest: donna, what would we do different?

i think what we would do different first and foremost is acknowledge that we've learned the lesson, >> we have made the mistakes that put this on the opposite track of the american people. we will now step forward with a bold vision and bold colors as reagan used to say that reflects the concerns of the american people that are addressed to the policies and programs that we think will empower you and uplift you. government should not be in the business of managing and controlling and deciding. it should be in the business of creating pathways to you can have the american dream however you define it for yourself. our party or the leadership

elected on the hill the government around the country, and the political leadership wants to create a pathway to empower families of community is to achieve the american dream. we will fight for that but we will start by listening and stay true to those principles that have been around for generations. >> host: chairman of our north carolina and author of this new book. they told step program for defeating the obama agenda.

[applause] good afternoon. welcome. i am the assistant secretary of state for population

refugees and it is a privilege to welcome you hear today with more than 100 organizations representing non-governmental organizations academia the diplomatic community representatives from congress and other friends of the obama administration to help us commemorate and celebrate the 15th anniversary of the international conference on population and development and what honor for me to be assistant secretary of the bureau that is that a party that has the responsibility for the population policy especially on this day to the principles embodied in the cairo program of action win -- in which somebody be played an important part. cairo was a landmark event.

a change the way government looked at population issues in change the way we designed and implemented population program. the unprecedented demonstration of support 179 governments adopted the cairo program of action and made clear the connection between the population and development international committee recognize to reduce poverty and promote sustainable development we must address the issues of women's health, women's rights including reproductive rights as well as issues of gender equity and gender equality. and only then can we ensure a better life and better quality of life for all.

with the united states leads as we did with the support of so many of you in cairo 15 years ago the future we envisioned could be realized. partners, children who are cherished and nurtured and families strengthened and prosperity for all. now to introduce the secretary it is my honor to introduce one of those individuals who played such a critical role on the world stage of implementing the vision whose commitment to women we all share and are unparalleled. no introduction is necessary. [laughter] my friend i am happy to say my friend the first u.s.

ambassador for women's issues, . [applause] >> bank you all very much. let me add a very special welcome to all of view it is with deep gratitude this snow is not always big is the last one and we can all gather and beach a view it deserves a special blow, but on behalf of the secretary we're grateful to have congressmen to be here some members of the diplomatic corps in that particular want to recognize mr. ramadan who'd negotiated the cairo document over three years now with the embassy of egypt in the number two position.

[applause] and also to played such an incredible leadership role. welcome. [applause] and for our government at the time former undersecretary. [applause] i have the best basketball to present to with great pleasure someone who has been a tireless advocate i am sure each and everyone of us remembers the powerful keynote address almost 15 years ago at the conference in beijing witchy underscored that women's rights are human rights. and among the violations of

human rights, she said is the nine women their right to plan their own families. she reminded the world that day if we take steps to better the lives of women will also better the lives of children and the nation's and i am sure that many of us remember the hope she expressed at the forum to mark the fifth anniversary of icpd. that if we were there as she said, one achievement she looked back and hope for would be standing in the year 2015 and at that time it would be that we have created an environment in which more children who came into our world were

wanted, pregnancies are play and and where women are given the rifle place in all of our society is. just two days ago in a groundbreaking speech on development a subject she knows more about that any of us having seen first hand in 70 countries, what needs to be done and what development needs to two she said one of our key priorities is to invest in women and girls who are critical to advancing progress around the world. and she added, this is not on a strategic interest of the united states but the issue of great personal meeting and importance to me. this is a hillary clinton everyone in this room knows. a champion of the goals of cairo and their connection to post development issues. know where is the more

apparent today then heard leadership of the administration's global health initiative with his commitment to maternal health and family planning and ensuring that it focuses on girls and women central to all health programs. whether sitting under abn entry with the on mothers learning to take care of themselves and their newborns in indonesia or traveling to women health centers from central asia to central america or standing at the podium today as secretary of state to mark the 15th anniversary of icpd, she continues to be a driving force to the principles adopted in cairo. please welcome a woman who has not wavered in her commitment of these issues, as secretary of state, hillary rodham clinton. [applause]

>> thank you very much. thank you. thank you all. my goodness. thank you. this is a wonderful occasion. several of us were quite nervous last night. i am delighted the sun is out and shining on all of you here as they gather for this commemoration of the 15th anniversary of a ground-breaking agreement in cairo. when i think that and the thousands of people who were a part of its, who came together to declare with one voice reproductive health care is critical to the

health of women and women's health is essential to the prosperity and opportunity of all two communities and sustainability and development of nations, it makes me nostalgic for conferences held that actually produce results. [laughter] and give us a framework for moving forward. there is no doubt in my mind that the work that was done and the commitments made in cairo are still mobile work of what we intend to be doing and expected to two on behalf of women and girls. the year 2015 is the target year. part of the reason may wanted to have this commemoration is not only to look backwards but for word. what is it we will do between now and 2015? remember what was expected

of us? all governments will make access to reproductive health care and family planning services a basic right. we will automatically reduce infant child and maternal mortality. we will open the doors of education's to all citizens but especially to girls and women. it is somewhat hard to believe in retrospect that cairo was the first ever global forum that recognize the connection between women's health, the quality of women's lives and human progress on a broader scale. i am delighted to join a new and marketing this land marquee event but more importantly to ask you to join with us to rededicate ourselves to the goals that we embrace 15 years ago and they remain critical and

unfilled. i have had the honor and privilege as i look around this audience of knowing many of you, and some of you for a very long time and i know how committed many of you have been and continue to be. we have made measurable progress since 1994 to improve the health and lives of women and children, especially girls. for example, the use of modern contraceptives worldwide has increased from under 10% in the '60s up at 43% 2008. greater access to neonatal care including medicines that prevent the spread of hiv to mother to child. significantly increased child survival rates and a number of girls enrolled in schools around the world has gone up. we have come closer to a

less measurable but still critical goal, the integration of gender into a rage of problems including efforts to the united nations to bring an end to sexual and gender based violence however vast inequities remain too often still today is end 2010 women and girls bear the burden of regional and global crisis whether as an economic downturn or climate change or political instability. they still are the majority of the world's poor, and schools, and healthy and underfed. -- consequences -- convicts but increasingly they bear the consequences of such conflicts.

we have seen that from the congo to bosnia two burma and 15 years after the cairo conference to many women have little or no access to reproductive health services including family planning and maternal health care. when we look at the deficit with health care for women women, we can see what it means in terms of lost productivity, resources and lives. nearly half the women in the developing world the bill of babies without a nurse come that midwife, a doctor or access to crucial medical care. global rates of maternal mortality remain perilously high. one woman dies every minute two of every day in

pregnancy or childbirth. for every woman bad guys, another 20 suffer from injury, infection or disease every minute. more than 215 million women worldwide lack access to the modern form of contraception and this contributes to the near the 20 million tons saved abortions that take place every year. sexually transmitted diseases including but not limited to hiv/aids claim millions of lives annually among women. it destroys the lives of millions and is a result the pregnancies that occur when a girl is too young. an estimated 70 million, a 70 million women and girls

worldwide have been subjected to female genital touching. a procedure not only painful and dramatic but also the source of infection and increased risk of injury during childbirth. as those of us gather in the ben franklin room on the eighth floor of the state department know very well the topic of reproductive health is subject two a great deal of debate. but we should all agree the numbers are not only grim but after 15 years, they are in tolerable. for if we believe human rights are women's rights or vice versa would then we cannot accept the ongoing more regionalization of half of the world's population. morally, politically socially or economically. [applause]

we're here today to examine the distance that remains to be traveled before the world fully realizes the icpd poll. this is a journey the obama administration and united states government will travel with you but we need to travel quickly because we only have five years to meet our original goal. withheld statistics i just met -- mentioned point* to a broader impact as a connection retrain a woman's ability to plan her family and pregnancy and give birth safely and her ability to get an education, work outside the home, support her family and participate fully in the life of her community. when she becomes a mother before she comes literate, when it will make gives birth the loan and is left with a permanent

disability and toils daily to feed her family but cannot agree to contraception it represents suffering of what can and should be avoided it shows the potential that is unfulfilled and also the opportunity to extend critical health to women worldwide and the children that depend on them. that is not only the right thing to do but also of the smart thing to do. that is where integrating women's issues as key elements of our foreign policy agenda and especially the global health initiative and global food security initiative. that is why we saw the first appointment of an ambassador for global women's issues and it did not take long to see who should fill that

position where we're remembering entrepreneurial efforts and that to america to ensure that it is spread more broadly including two women and why we're working with religious leaders to increase access to information about family planning and preventive health care. we're doing all of these because we have seen when women and girls have the tools to stay healthy and the opportunity to contribute to their families will being they flourish and so did the people around them. consider the one story from uganda working with the international planned parenthood federation to provide education and skills training to low-income women. among the clients are a group of teenage girls who call themselves the move by stars. the parents are dead leaving them the sole providers for the younger brothers and sisters without any other

option they were working as prostitutes. through this program they gained access to condoms, sex education to protect themselves from disease and pregnancy and began taking class's and selling and renting and other skills that could help support the siblings about and teaching -- and injuring their role being. thanks to the job training and support, and many of the moonlight stars have left prostitution behind and embarked on a path of opportunity for themselves and their families precut investing in women that anniversary is trooper comments society where women's rights and roles are denied girls are forbidden to attend school or pay a heavy price to do so. few have the right to decide

whether or win to become married or mothers. poverty and political oppression and violent extremism often follow. maternal and child health are particularly important indicators of broader progress and 10 years we have learned more about the conditions that a company political unrest. one of the constant predictors of political of people is the rate of infant mortality. and place where the rate is high the quality of life is low because investment in and access to health care are often out of reach. the breeds the frustration and hopelessness and finger we have seen. we also know that child mortality is closely connected with maternal mortality. when she dies the children are at a greater risk of dying as well. the struggles cannot be

separated the their campus solution. in the obama administration, we are convinced of the value of investing in women and girls. we understand there is a direct line between a woman's reproductive health and her ability to be dave productive life and we believe investing in the potential of women and girls is the smartest investment we can make. is connected to every problem in anyone's mind around the world today. [applause] we're rededicating ourselves to the global efforts to improve reproductive health for women and girls under the leadership of this administration and committed to meeting the cairo goals and working in partnership with all of you.

one of president obama's first action was to overturn the mexico city policy which greatly limited our ability to find family-planning programs. [applause] we have pledged new funding, programs and a renewed commitment to achieve millennium development goals namely a two-thirds reduction of global maternal mortality and universal access to universal health care. it is critical to and interconnected with every other millennium development goal. but the world has made it less progress for filling that goal than any other. this year the united states renewed funding of reproductive health care through the united nations population fund and more funding is on the way. [applause] u.s. congress recently perpetrated more than

$648 million in assistance to family planning and reproductive health programs worldwide. the largest allocation in more than a decade since invest had a democratic president i might add. [applause] in addition to new funding we have launched a program that will be the centerpiece of our policy the hat health initiative that commits us to spending $63 billion over six years to include global health to reduce maternal and mortality and have million of unintended pregnancies and avert hiv infections among other goals. it will apply a new approach to promote health and address into related health challenges together. for example,, by integrating family-planning, maternal health services and a tie the eighth screening and treatment so women receiving

reproductive care will also receive hiv counseling and referred to the hiv clinic if they need one. morale seen the rise of the largest generation and and the history of the world they need and deserve to know how to stay healthy and through this initiative will be providing critical information to them. the global health initiative will focus on helping countries strengthen their own health system. we want to build sustainable health systems and countries. that will ensure all of the global health programs including nutrition, malaria , hiv/aids and tuberculosis will be meeting the needs of women and girls by taking into account social and economic factors that have an impact on their health, from sexual coercion, domestic violence to gender and equity.

hiv/aids morphs into a woman's disease and increasing the younger and younger women in many poor countries are infected. be no expanding access to contraception helps only if women are empowered to use it, protecting oneself from a chevy is harder when one's life depends on staying in a man's good favor and all prenatal care in the world launch protective mother or child from an abusive home. promoting women's health and children's health improves the quality of their lives on many levels. and it also means reaching out to men and boys to encourage them to become advocates and allies. we have our work cut out for us but we have an excellent road map and they were the target in the millennium development goal number five.

. .

evin population fund and and she finally received the surgery care and emotional support she needed to heal. then she started speaking out about her experience to fight this stigma and let other women who know even an isolated places treatment is possible. her message is traveled the world. two years ago she came to washington and urged members of congress to support maternal health programs worldwide, and today the united states is proud once again to support the work of the u.n. population fund. but one that could come even one with such passion and commitment it took to can only do so much. everywoman everywhere includes

the the eckert requires quality care at every stage of life. that is our goal and that is our responsibility. it is also a matter of simple equity and fairness to read i have in many places in many parts of the world where the rich, the educated, the well off, the connect, the powerful, the elite have access to every single form of health care. and yet it was denied, by the law, denied by culture, denied by taboo, denied by regulation, denied by resources to the vast majority of women in the same societies. that is unacceptable. part of what we need to do is not only provide services to those who need them but to change the minds and attitudes of those who can be responsible for delivering those services in

countries are on the world. i have said in many different settings i guess on every continent except antarctica -- [laughter] -- that the rights that women who have a position in society are able to command cannot therefore be denied to the women who lived down the street or care for their children or clean their homes or plant their crops and we have to do a better job of making the equity argument on behalf of girls and women and particularly on behalf of the cairo agenda. i'm very optimistic and very committed we can do this together and i am very grateful for what so many of you have done for so many years.

you have written the ups and survived the downs. you have worked in a favorable political environments and on favorable ones. you have seen the mexico city policy come and go, and you have stayed true. you stayed true to your commitment, your passion, your belief that every single child in this country boy or girl deserves the chance to live up to his or her god-given potential. i just want to urge that we do not grow weary. i don't know about you but sometimes it can seem a little bit hard to take. it is also self evident, it seems so obvious to the rest of us that this needs to be done and we keep encountering obstacles of every shape and size, but please stay with us

and let's try to create institutional and structural change that does not get wiped away when the political winds blow. let's try to create markets for these goods and ways for funding them and educational and instructional programs along with our commitment to serve that will give when an everywhere of the chance to take their own lives and their own futures into their own hands. it is now my great pleasure to read you have met two of my wonderful team members. i want to introduce two more who might see. one is dr. robert shaw, our superb administrator of usaid. [applause] to come here.

[applause] we want you to get to meet him. we want you to support him as he makes the changes that are necessary to put usaid back on the forefront of world development agencies. now it's my honor to introduce the undersecretary, maria otero and maybe you and roger could say a few words to close out the program. [applause]

>> well, i think probably one of the most important things i can do is really thank the secretary. thank not only for her words today, but also because in the remarks she made to us, we heard again the unwavering had leadership she has given and all of the work that has been done to carry out the cairo program of action and that leadership she expressed today not only because she gave the sobering facts of the realities that we face but also as she always does, she reminded us of the individual woman of the village in ugonda and a small salam and another city in africa or south

central america. a story that has been one of the things that has propelled her to support and do the work she's doing. and which we always have to remember is at the core of what we are doing. but she always reminded us that leadership she has given is driven also by principals and by long-held convictions that she has been articulating now for decades. and so i want to just express my gratitude for having her be able to provide that kind of leadership as we sit here and it not only celebrate but look forward which is what she is asking us to do. and i think i probably am speaking for all of you and it is a joy to be able to see this, but isn't it incredible to have a secretary of state of the

united states to stand here and say that women and girls are front and center to the foreign policy and foreign assistance of this country. [applause] you have no idea what a joy it is to work with her, so i think the only other thing that i would say after they're really inspiring and important words of the secretary is to also thank all of you. i look around the room and there's people i've known for over three decades, and people i've worked with in her reproductive rights and women's rights and issues that all of us are working on and if we don't continue to do that and do it

within the commitment and the determination all of you have shown and the secretary has expressed we won't be able to achieve and move forward the cairo program of action and the millennium ifill goal we are seeking. so my thanks to all of you and certainly after rogers is a few words we want to invite all of you with assistant secretary schwartz, ambassador bavier, administrator shaw to july and in a reception and to celebrate as we move forward in this struggle we are all living together. [applause] thank you. if i'm standing between you and a reception i will be brief. i will say this has been an incredibly special week for me and for the united states agency for international development.

is it fri? i can't tell it's been -- on wednesday the secretary delivered at the center for global development what i consider to be perhaps the most important speech ever given by a secretary of state as it pertains to the subject of development. and for those of you that have not had a chance to both read the text and almost more importantly see the delivery, it could only be given by secretary of state that has decades of commitment and understanding and knowledge for this mission and i thought made a powerful and important point about how this is a serious effort to make development central to foreign policy and use the tools of diplomacy and defense and development all to further our goal in a much more robust way than has ever been done. i was followed yesterday by the

secretary being gracious and willing to come to the united states agency for international development to swear me in and was a wonderful event there but with more than 1,000 people there mostly our wonderful staff and team she made the point she was in fact this sitting usaid on her second day on the job, the day after she was sworn in and she came back today after she gave a major address on development and said the agency's excited, is energize and is ready to live up to the principles that were outlined on wednesday and i know many of the core concepts that she's talked about today and i will close by saying as i look around the room and i see so many partners i've had a chance to work with in different environments and many of using the e-mails over the past few days, so thank you very much. we will absolutely look forward to a deep and important partnership with u.s. this work

goes forward. that was perhaps the core operational guidance for the secretary for how we should operate in development different from the past to do our work in partnership not patronage, the partnership extends to the women and girls who should be the primary focus of our efforts. it extends to the country's 22 lead and unknown the vision of change and commitment to change this required for a sustainable result and that extensive everyone in this room as i look around have created the technical and policy and programmatic innovations that we need to learn from so that we can and use the best practices of an incredible discipline and talented group of leaders into a multibillion-dollar development enterprise. thank you. i look forward to working with you and with speaking with you at the reception. thanks very much. [applause]

at his first press conference of the new year

japanese prime minister were yikio hatoyama told reporters its top party is include preventing another recession and balancing the budget. mr. yikio hatoyama also is your questions on u.s.-japan relations and whether he will reshuffle his cabinet. according to several media reports support what the prime minister andap dropped from 74 % since the august 2010 election. >> [speaking in japanese] >> translator: we will now have a prime minister meeting with the minister yikio hatoyama. i would like to wish all the people of japan a happy new year and offered my heartfelt wishes that this will be a wonderful year for all of you. thanks to you, we were able to

realize a once in a century change in administrations. but the reality is i think this point we are no now just standing on the starting line. we sought to create a new kind of politics that are not run by bureaucrats but where the citizens played a leading role. with your support, when u.s. administration is ready to achieve reform on the great ones in a century scale. our efforts have just begun. it has now been just over 100 days since the new administration started. i know that in many ways we have not come up to your expectations. we are in a difficult process of trial and error. but i believe the people now feel politics in which japan has begun to change. i sincerely believe this.

my determination is to maintain my our version of focus as the prime minister and to work together with all of the citizens to create a new kind of politics, politics the will serve more needs. this year will be the crucial year deciding the success of our efforts. on new year's day, i visited the temporary shelter set about the olympic center in tokyo for part-time unemployed people. there are many people there in difficult straits. everyone who lives in japan should be able to enjoy the minimum standard of living, guaranteed by the constitution. the government should be supporting people who need a place to live who want to work but can't find jobs. >> [speaking in japanese] >> translator: during the course of the next year i hope

to create the kind of politics that safeguards people's lives. many people are concerned about economy and unemployment. i know many people feel these concerns. we cannot permit this to become a double-dip recession. we will not allow that to happen. with this determination at the end of last year we've put together an emergency economic policy response that included 24 trillion yen budgeted to promote future security and growth was based on this we developed a second supplementary budget for fiscal year 2009. the we hope to pass this budget as quickly as possible so that the citizens of japan can read and even to a small degree a sense of prosperity.

we promised many things during the election campaign in our manifesto and as the three governing parties. these include a child rearing allowance, for a public high school education as well as individual household income support for commercial agriculture. we have created a budget proposal for fiscal 2010 that reflects a solid commitment to the kind of politics that protect people and their lives whether this be employment including small businesses, child rearing or retirement pensions, health care, and long-term care, education and the environment. when this budget is passed i am confident people will appreciate how epic making it truly is. we will make every effort to

ensure the earliest possible passage of this budget. this is our determination. at the end of last year deputy prime minister led efforts to develop a growth strategy, the purpose of this is also to empower people with hope and enthusiasm to their work so they can manifest their full capabilities. it is easy for issues such as the environment or the aging of society to be viewed in a negative light as a problem to be dealt with. i think we have to turn this around and see these challenges in a positive and forward looking light. the environmental issue for a table is a great opportunity for japan to create world-class marine industries. increased longevity and aging of the chance to develop creative

policies that help people maintain their health and you can make japan the best place in the world for seniors to live. we believe our growth strategy reflects this kind of forward-looking perspective. we need to shift emphasis from the supply side to the demand side of the economy. until now people have been seen as the means for realizing economic growth. many people feel this is backward. the economy should exist to meet people's needs. this is the change in thinking we want to implement from this year. this is why it is crucial to empower local communities to meet their own needs and challenges. the idea that the central government should do everything is out of date. whatever can be resolved on the local level should be. the answers should come from within the community. this is how we hope to change japanese society. this is what mean we mean by

politics in which citizens take the lead. this is why we established a strategic can refer regional sovereignty which i chair. one of the priority objectives is to create regular been used from deliberations between the central and local governments. we also want to affect the change from conditional subsidies to lump sum grants given to local communities. we will budget funds specifically for use by localities. over the course of the next year we want to fundamentally change the relationship between the central and local governments. we want people to be the to field this change. this has to be done under the leadership of the elected officials, and it has to be done speedily. we are leading the not work so that elected officials can work

effectively. we feel revamping the systems in preparation for this is extremely important. this is why we abolish unelected vice ministers. people in the three political level posts in the bureaucracy's the ministers and senior vice ministers and parliamentary secretaries have worked hard and we have been able to initiate politics driven by egullet officials. we want to keep moving forward step by step in this direction. our efforts to review government programs have been very well received. we want to further expand the scope of this to include regulatory and systemic reforms. >> [speaking in japanese] >> translator: we would also like to include independent administrative organizations and public interest corporations in this process. we would like to hear people's ideas about for example

independent administration organizations no longer necessary or that could be reformed. we also want to be even more strict in prohibiting the hiring of retired bureaucrats by the private-sector. it is lying believe the diplomacy and security among the most important responsibilities for the central government. in my first 100 days of travel outside of japan on eight different occasions. it was especially important i met with many of the top leaders in asia. i think i was able to convince them with the new administration japan started to change. i felt this very clearly from their reactions. whether the issue is climate change or nuclear disarmament in the nonproliferation, japan. i think people have started to feel this.

i would also like to make next year the year in which while maintaining a strong foundation of the u.s.-japan security alliance we emphasize the importance of asia and further develop the vision of an east asian community. this is one of the reasons why it is important to resolve the issue of moving the u.s. air base. we need to respect the feelings of the citizens of okinawa but at the same time there is an existing agreement between japan and the u.s.. these are my honest feelings, and i don't believe that i have been dealing on this issue. we need to set a deadline and over the next few months, with a solution that will work for both the people of okinawa and the american people. we've created a committee with members of the three governing parties which promise will thoroughly debate this issue and produce an outcome. this is critical to the very

important u.s. japan's security relationships i hope in the future people will look back and say it might have taken some time but to the hatoyama produced a solution to this problem. the coming year is not just a critical year for the democratic party of japan or the coalition government. it will be crucial in with their politics returns to the people, whether or not people can feel truly confident in that regard. i want to make it a year in which our seniors can say that the world has become a safer and more secure place to live. where young people who've been looking unsuccessfully for work can say i found a job. >> [speaking in japanese] >> translator: i want this to be a year and which young

children can feel strongly that they are moving toward a hopeful future. >> [speaking in japanese] >> translator: over the course of the next year the cabinet members under my leadership will work to the of most of our ability. our cabinet exists for the sake of the people. we will continue to work keeping that prime point in sight with that seeking your support and cooperation i would like to close my new year's message. thank you very much. >> we will now have questions from the press. i would indicate the people who will be asking questions please state your name and affiliation. please raise your hand. >> i am from the newspaper please allow me to wish you a

happy new year. it is clear the biggest political battle coming up in the new year will be the house of councilors election law. i would like to ask what your stance looking toward this election will be. do you intend to keep the same cabinet membership or is there any possibility that you would reshuffle the cabinet in preparation for the election and is there any possibility that there would be a simultaneous warehouse election condra and with the house of councilors election? >> finally i would like to ask how many seats you think you have to win in the house of councilors election in order to be able to declare that you have been victorious in that election.

>> de >> [speaking in japanese] >> translator: as i mentioned earlier, our first priority is to pass the budget and safeguard the livelihood and welfare of the people of japan. i want to greatly accelerate the efforts of our administration in this area during the new year. therefore, i am completely focused on getting the budget passed and creating the kind of politics that will safeguard the wellbeing of the people. everything comes down to this. this is therefore not the time for me to be making statements about the coming house of councilors election. in other words, i'm not giving any thought to the idea of reorganizing the cabinet ahead of the election, nor do i have

any thought about calling a double the election for both houses. i'm not thinking about that sort of thing at all at this point. our goal is to do our best for the people of japan right up until the time of the election. through such efforts, we will naturally be able to see how best to compete in the house of councilors election. i am, therefore, not in the position at the start of the year to tell you what number of seats would constitute an electoral victory or defeat. next question, please. >> i am from the television. the regular session would be convened this month. there are a number of bills being tabled such as to elevate the national strategic office to the department level status. when do you think this might pass? at the regular session of the diet your political responsibility for the incident involving falsification of political contribution records would become a focus of inquiry.

the opposition parties will seek further explanations about how the money was used. how do you intend to respond to their increase? >> first, regarding the the diet session, various legislation will of course require coordination within the democratic party of japan and the other governing parties. this is something that still needs to be worked out in order to have bills that further promote the ascendancy of elected officials over a bureaucrats and to revise the law governing the way the guy at functions these are some of the things we will be debating. there will also be a debate regarding whether the foreigners will be granted the right to

vote in the local elections but the first and most important thing is to coordinate our view within the governing party's. once the positions have been coordinated we will put forward proposals for the new legislation the process of coordination is the most important thing so that we can pass the supplementary budget that will safeguard people's livelihoods. this is the same in the case of the regular budget. it is of course has to take priority. then we will start thinking about proposing and working to pass various laws. and regarding the question of my political contributions i have received the situation surrounding this incident is just as i informed you at the end of last year when i held across press conference i believe that i had explained everything as well as i can within the extent of my own

knowledge of the defense. there are things that happened in the past that i myself don't really understand. so, i can appreciate why this might not be very convincing to the people of japan. as a matter of accountability i will continue to exert my best efforts to explain these matters. as for the prosecutors, they've already reached their conclusions. so, in terms of the question of falsified contribution records, i think that the matter has been settled. if this comes out in the diet i plan to respond as fully and carefully as possible. this is my intention in terms of how the money was used there is a question as to how much effect will grasp of the matter i actually have but i will do my best to explain the matter.

>> next question. >> i am from the newspaper. he spoke a moment ago about the u.s.-japan relationship. this year will mark the 50th anniversary of the revision of the u.s.-japan security treaty. i would like to ask if you could share with us in some concrete detail your image of the idea of u.s.-japan relationship. >> i think this year marking the 50th anniversary of the revision of the u.s.-japan security treaty is in a sense a very important year. i hope we can avail ourselves of the positive opportunities it presents. in other words, security matters are of course at the heart of

u.s.-japan alliance. but there are many other levels at which japan and the u.s. are indispensable to each other. i think it is important that we recognize these aspects of the relationship. there are a number of global issues such as climate change and nuclear non-proliferation with regard to these issues i hope we would have relationship where we can positively a search respective positions where we can say what needs to be said even as we continue to enhance mutual trust. even if you have your own viewpoint. if you feel it would be received well by the other side and so you choose to remain silent and simply follow with the other party wants this is not the idf relationship rather a relationship where one can say what one wants to. this will improve trust within

the relationship. this is the kind of u.s.-japan relationship we would like to build and i think this will be an important year for deepening relations on a number of different plans. >> my question is regarding the revision of the constitution in the past you've written your proposal for a new constitution and i would like to ask your thoughts what we should process of delivery attrition be pursued, how should the debate proceed and you have any intention to revoke the committee? >> as a member of the politician and member of the dalia i have my views about the constitution. this is a debate that should be held among the members of the debate of the die get, so in the sense i would like to offer my

ideas and proposals for what my ideal of the constitution should be. but more than security issues my ideas are focused on my concern for increasing regional sovereignty based on the idea of a fundamental change in the relationship between the central government and localities. at the same time however i am prime minister and as such obliged to follow and uphold the constitution as it presently stands. this means my work must be conducted from the position of upholding the constitution. when we think along these lines we need to bring together the views of the three coalition parties especially within the democratic party of japan. as we further date issues regarding the constitution. this is critically important. i think as i get members we cannot avoid the debate on the

constitution. but at the same time, there are crucial real-life issues such as the economy and of pressing importance that need to be resolved for the sake of the citizens of japan. this is the most important challenge facing the government so while upholding the constitution we need to have a debate on the constitution among the governing party is ideally among all the parties and this debate should be fully pursued therefore i think any question of invoking the constitution review committee should be decided jointly through discussions among the governing and opposition parties. this is the proper way to pursue this matter. this will be our last question. >> i believe this is a question that perhaps should have been asked when your administration was first launched. but i would like to know if you intend to maintain the same

cabinet lineup all the way through to the next general election. your intention when you put the cabinet together or is there any real possibility that he would reshuffle your captain net and custis were required. >> this is a real important question. i believe that if the members of the cabinet are always changing, it undermines confidence not only domestically but even more importantly internationally. the cabinet has to face the country presence to the world becomes obscure, and this makes japan less of a presence in the world. therefore it is my hope each of the cabinet appointments that i have made will be able to continue in their posts for as long as possible. i would like them to work in those positions as long as

possible cash. i don't think it serves the national interest to continually and casually reshuffle the cabinet. >> [speaking in japanese] >> translator: we would like to close the conference at this point. thank you very much.

a discussion now about health insurance exchanges. part of the healthcare bill creating clearinghouses for people to buy health care coverage. we will hear about how some existing exchanges operate and the differences between the exchanges included in the house and senate bills. this is about one hour and 45 minutes. [inaudible conversations] >> if i could ask you to find some seats, which may be easier for me to say than for you to do. i usually can point to a bunch of empty seats up front but by golly, we even have most of them filled. there are a couple though. i appreciate your patience.

we try to accommodate as many people as we could. but we've got a very popular topics and powerful speakers and a very timely vacation, so we will do the best we can and i ask your indulgence. i want to welcome you. my name is ed hubbard with the alliance for health reform. and on behalf of senator susan collins and senator jay rockefeller, members of our leadership, welcome you to this program. to examine the parts of the senate and house health reform bills that would set up a health insurance exchange or set exchanges to improve the way individual and small group insurance markets function. a lot of different models for exchanges, and they can defer pretty widely from each other. everything from simply a farmers

market stifel website that allows a better grasp of the available options to an exclusive high leverage of the tory animal that exerts substantial control over who can buy what and at what price. fortunately for purposes of our looking at this issue exchanges to indeed exist in nature. both government really to and privately run and we are going to hear today from folks who have been running some of those successful exchanges and we will hear some about exchanges that haven't been quite successful and of course we will look at the exchange provisions of both the house and the senate bills in all of which looks similar but there are noteworthy differences and we will get those as well. my colleague and co moderator sara collins of the commonwealth fund will be the frame the

discussion by leaving out very broadly what is in the bills and what issues need to be addressed in reconciling the the two versions which is kind of a nice segue to the fact that our partner and co-sponsor in this briefing is the commonwealth fund which both commissioned and non-in some ver excellent analysis of this issue the exchange proposals and the bills and the idea of an exchange itself. and now let me turn to the aforementioned sara collins. she's the vice president for the affordable health insurance program at commonwealth and co moderator of today's program. she's an economist and the name author of the papers you have analyzing the provisions of the respected reform bills available as handouts. sara? >> thank you, ed.

good afternoon. as mentioned, i'm going to briefly laid out a broad provisions of the house and senate bills and look where people in particular are estimated to gain coverage under the bills. in particular the number of people covered through the exchange's and then discuss why we need an insurance exchange and the type of reform bills that are before the congress and with the key issues are in terms of structure and implementation as we move forward. everyone knows by now the broad outlines in the bills, they both aim for near universal health insurance coverage by building on what are the strongest aspects of the health insurance system and large employer based coverage, medicaid, children's health insurance program by regulating and reorganizing the individuals and small group insurance markets which are arguably the weakest part of the current system to reach each bill would bring sweeping change to those markets which have previously fallen nearly exclusively under the purview of

states by establishing new federal rules requiring insurance carriers to accept everyone who applies for the rating based on health status and implement a chance. it would create a new health insurance exchange operated at the national or state level for individuals and businesses to purchase health insurance coverage, sliding scale premium subsidies and cost sharing subsidies would improve affordability and reduce under insurance and a simple standard benefit package with different levels of cost sharing would set the floor for pants offered through the exchange income eligible for medicaid, increased 133 prisoner 150% of poverty and large employers recover to offer cost or nearly everyone would be required to have health insurance coverage. in terms of where people would gain estimated coverage of the bills these are estimates from the congressional budget office. it would remain the predominant source of coverage covering

about 160 to 170 million people under the bills. the exchange's are estimated to provide a source of coverage to 30 million people either individuals or employees of small companies small to mid-sized companies purchasing coverage through the exchange would bring about five to 9 million people into the exchange is also about 30 million covered under the exchange's of both bills. coverage through the medicaid program rises expected to rise from 35 to 50 million people uninsured estimated to fall from 56 million estimated in 2019 to 18 million under the house bill and 23 million under the senate bill. so what is the purpose of an insurance exchange and context of broad based health reform proposed in the bills that builds on existing health insurance systems? the individual and small group insurance markets are poorly organized right now. they are substantial barriers to

obtain coverage. market rules and consumer protection's vary widely across the state's. plants are difficult for people to understand. large percentage of premium dollars goes to administrative cost. there's a lack of economies of scale and market competition is based on avoiding risk rather than enhancing value so exchanges can be designed to provide structure and oversight to insurance markets with goals of improving consumer protections enhancing transparency of the benefit packages pummelo wording premium growth, reducing health care costs and changing the competition to nay from a risk to value. the key provisions of the exchanges in terms of their viability over time and ability to provide comprehensive coverage reduce cost include strong market reforms both inside and outside of the exchange's brought risk when individual requirement to have coverage, but if the standards to ensure comprehensive coverage

and informed choice. sliding scale premium and cost sharing subsidies that should only be available through the health insurance exchanges, the authority of exchange to negotiate premiums or set rules and participation for health plans, excuse me to negotiate premiums a choice of high value donner plans. tim jost is bring to provide more detail but we house and senate bills on the exchanges as he does in his excellent paper included in your packet today's i'm going to skip the slide and leave that discussion for tama and get you what i view as the key issues regarding the structure and implementation of exchanges as we move forward. those include federal versus state operation or control of exchange, exclusivity of exchange and by that i mean whether the exchange becomes the whole market or if the individual and or the small group markets are allowed to

exist outside of the exchange. the extant which the exchange has authority to negotiate premiums and set rules of the participation and whether the rules for participation are aimed at encouraging, plan innovation and value in health plan design. and finally whether the exchange will have the ability long term to the risk of justice of the competition between plants is focus on value and not risk. thank you. >> thank you very much. before we move to the panel let me do a little housekeeping here in your packets you are going to find a lot of good background material including speaker biography information much more extensive than we will have time to give them orally and he will find the presentations you may find hard to read on the screen in your packets as well. if you are watching on c-span and have access to computer you can find copies of everything the folks here have in their

tickets at our web site, which is www.allhealth.org. and for the record we did not get a letter from c-span asking us to open this briefing to the cameras. we volunteered it. >> there is a webcast and podcast available probably monday at the website kaisernetwork.org. i'm sorry, kff.org. i've got to change that, which stands for kaiser family foundation. thank you very much to the folks who make that possible. you will find copies of the material there as well as at our website. and in a few days you will find on our site a transcript of today's session which a lot of people find useful in reviewing

things very quickly. at the appropriate time you have question cards in your materials, green cards you can use to write a question and have it answered by our panelists. there are also some microphones you can use at the appropriate time and following the program i would appreciate if he would fill out and leave with ross w. evaluation forms in your packets. now let's get to the program. we've got a duraid knowledgeable group of experts and today with a broad range of we are going to your brief presentations and have lots of time for discussion and questions. let's start leading off today as timothy jost from the washington university school factory and he's the author asked sarah noted on the paper of exchanges that provide the jumping off point for the discussion today. tim has written several books on health policy topics not to mention his co-author ship the

ofeading casebook on health called cadging we enough, "health law," now in its sixth edition and whether you agree with him or not on a particular subject to think you will find his analysis how compelling and writing cogent and accessible for a lawyer or anybody else. thanks for being with us. we look forward to having a conversation. i must say as an aging law professor, powerpoint is still something i'm not very comfortable with. so i will do my best to move the slides along but you might also listen to what i have to say. if there's anything we can predict with almost absolute certainty about the health reform legislation that will emerge for congressional negotiations in the next month it is that legislation will include a health insurance exchange. the health insurance exchange is quite simply an organized market for the purchase of health

insurance. the exchange's most familiar are the messages its connector represented by mr. kingsdale and federal employees health benefits program. the medicare advantagehealth cah care systems of the netherlands argued we also germany have contained many of the elements of an exchange. the health alliances which the clinton plan was built or exchanges as war and our state based and private purchasing cooperatives which has been tried repeatedly and sometimes with success over the past two decades. the connecticut business industry association represented here today by mr. vogel represents a private cooperative. of course we'll each of these models can't be called an exchange they are in fact quite different. indeed the models represented by the house and senate bills are different and very significant ways. the focus of my paper and a brief presentation this morning

is how the house and senate bills differ and which model is most likely to result in the exchange the serbs' best the goals that in exchange is intended to fulfill. first let me quickly ask the question why do we need an exchange. what we expect an exchange accomplish for us. they are expected to play a number of roles in health care reform and sarah went over this but let me go over again. first it is expected to be the lowest of the managed insurance plans. it is hoped the exchange will focus competition on price and quality rather than on the risk avoidance and will thus make health insurance more afforda and more accessible. second, the exchange is expected to create a sizable risk pool and with reforms found elsewhere in the bill ll risk and to be more efficiently managed

reducing incidence of adverse selection by insurance and practice of risk selection of insurers. third it is hoped the exchange will reduce administrative costs by simplifying marketing and premium collecting and by eliminating risk-based underwriting and simplifying the packages as well and making markets more transparent and facilitating consumer choice on health insurance plans by standardizing the plan offerings and providing more and better information about health insurance options. and it may play a regulatory role helping to make insurers more accountable in particular it could serve as a forum for reallocating risk among insurers and for guaranteeing that those who sell comprehensive health insurance coverage those

insurers or comprehensive health insurance coverage but manageable cost sharing and that they market the plans fairly and they respond properly to consumer claims and complaints as well. six, the exchange will likely play a role in facilitating other key features of the health care reform legislation such as the payment of premium credits or even perhaps the imposition of the individual or employer mandates. in many respects the house and senate bill's provisions governing exchanges are quite similar. both the house and senate bills for example permit individuals and then on group market and its employees of small employers to purchase health insurance through the exchange. both require health plans offered through the exchange offer standardized essential benefit packages that are a range by tiers on cost sharing or actuarial value to facilitate

consumer choice. both bills contain an extensive range of transparency and disclosure requirements to facilitate choice and in prevencher accountability. both provide premium subsidies will cover over half of all uninsured individuals in the mullen group marketing and our only available through the exchange. both give the exchange some discretion over whether or not to offer health plans and thus bargaining power with insurers. both bills generally of all risk underwriting by insurers and pre-existing condition exclusions and both bills contain a program for relocating risk among insurers. although the programs in the two different plans for was collocation are very different both allow grandfathered plans to exist outside of the exchange which will undermine its ability to pull a risk. the bills however differ in key respects. which approach is in the end

taken will have a profound influence on implementation and effectiveness. first, the house bills put responsibility for creating exchanges on the national government. the house bill creates a national exchange but allows states that can cat presumably massachusetts to opt out. ..

this will depend on the federal government effectively determining that a state has failed to comply with the law and stepping in after the fact. the state exchanges are also an unfunded mandate. there is no federal monday -- federal funding in the states to do this. they will have to pay for them themselves, presumably by taxes imposed on insurers. -- insuranceds. state-based exchanges have >> you don't have two sets up a 50 exchanges each with its own program, capacity to do all of the eight functions, you could have

one program. the federal government already has extensive experience with riding exchange like programs like medicare and vintage program, and cahal medicare part d pete prescription for quote they will be part of this exchanger the regulation system. most importantly a national program promises uniform implementation of the exchange's some states want to go beyond the federal program, the house bill allows them to do that budget does mean that's who knows state cannot lag behind are simply refuse to set up an exchange and then have the federal government step in belatedly and clean up the mess. the second biggest difference between the house and senate bill is the exclusivity.

the house bill requires nine group health insurance coverage other than grandfathered coverage to be sold. the senate bill allows the now group market to exist outside of thees not include pos inside too meet all of the requirements that must be met by qualified plans sold to the exchange. this leaves the door i believe, of wide open to adverse selection by ensures against the exchange. it allows a small group market to allow outside which threatens the difficulty. it compensates for the open market by requiring insurers to include all insurance in and out of the exchange in the same risk pool and requires issuers of qualified health plans to charge the same premiums in and out of the exchange for the same plan by requiring

insurers outside the exchange to cover the same actuarial value. and finally the senate bill has the allocation firm program inside and outside of the exchange. the senate bill leaves the door open for insurers who say it to stay out completely to set up plans that are configured to attract the best risks away from the exchange of a those with high risk groups. the said the bill will also require a greater amount of a regulatory oversight because it will require the states, not the exchange to collect enough data so it can risk a just between plants in and out. it seems it is far easier simply to require all insurance to be sold through the exchange.

a third difference a ball see a 30 of the exchange with respect to health plans. in particular does the exchange reoffer would ever plans ensure is make available or have regulatory authority as well. both the house and senate contemplate some regulatory authority making insurance insurance -- insurers have some as an affirmation to purchase a paper cup house bill goes further to explosive leak contemplate the exchange receiving bids and negotiating the terms with the insures but although the terms about specify the language of the use room open for the exchange to negotiate with respect to issues like premium common medical loss ratios and administrative costs, , etc.. the cost of the senate bill

allows the exchange to take excessive premium increases and in fact, requires generally that the exchange certified plan is like being in the best interest of the injured. i believe that the senate bill does look you -- the some discretion especially after the managers' amendment to negotiate with plans with respect to issues like premiums. there are other differences between the bills we can address with questions. the house bill includes a public plan may be for another few hours to be offered through the exchange. [laughter] the seventh will include some multistate plans so the senate bill layers one exchange on top of another exchange which leads two a interesting dynamics. also bars undocumented workers to buy insurance the

house only bars them from receiving subsidies. there is stronger transparency and disclosure requirements. the house are exceptionally good and requires the exchange rate to the plan's purpose and it requires qualified health plans to provide quality assurance programs was the house bill does not. neither bell, i don't know how much opportunity there is to slip in anything at the last minute but neither addresses privacy of the health data in the hands of the exchange and with the current hipaa regulations i don't see the exchange's are automatically covered. it seems that is a simple fix that could require some attention. a key point* is although the exchange holds great promises we have a history of some pretty disappointing experience. we would hear about some

good experience but a number of states have tried exchanges that have failed. we have a chance to get it write with this legislation and come up with a powerful tool to control costs and improve access and maybe even improve the quality of insurance and care preferred is important congress gets it right and i think the commonwealth fund and the alliance for sponsoring this meeting today to allow us to talk about a. thank you. >> by the way in his paper there is the executive summary up front and after that is one of the neatest charts you will ever see that summarize the differences of similarities of the two bills and i commend that to you. next three will turn to jon kingsdale he is the executive director of the biggest real world pilot

this side of the federal employee plan that is the commonwealth insurance connector of 37 up by the massachusetts landmark reform law from 2006. his work for more than 20 years of the private insurance world has taught at the harvard school of public health and even did a stint at reporting for "forbes" magazine and many of you called him for answers during the debate as you try to shape the language not just on the exchange related topics. welcome back and we're glad to have you. >> thank you. that was a helpful introduction from sarah and tim on the basics. i do not know how much further i will go. in case i lose your and it is easy to do i usually lose myself, the take away is

humility, more that we don't know then we do know about the house and senate versions vision would actually play out. i am so pleased that fell a google is here he runs in exchange next-door in connecticut both of ours are states exchanges and we cannot be more erred different. the hours is for individuals and his is for employers when you see a house version or senate version use a one out of 1,000 conclusions that may play out. with that said i will try to shed a little like. i start from the premises is perhaps the most challenging domestic implementation of a domestic policy initiative, at least in this century. that is easy. it is only 10 years but i would go back maybe another century. personal, a complicated, a partisan to say the

least, and cost control which is far more ambitious we just did access expansion we are now working on cost control because taking money away is always a popular activities of the house and senate and the administration should be congratulated on taking on the two toughest issues at once. and has been noted most exchanges have failed to reckon i feel like the 14th century european map makers describing the terra incognita and i have a personal bias the implementation is 90% of the game. many are focused on the act but i believe it lives or dies based on implementation. a lot of humility. i would start with saying the way to improve the odds odds, the exchange of any sort will work is to define

very realistically a limited set of objectives. i will not go into the details but when i hit the of -- hear the objectives set forth that run to the one doesn't objectives i shudder. and knowledge second day and compensate for the weaknesses in each bill and then to three source for whatever exchange we come up with adequately for implementation. most of what and exchange operator row have to encounter has not even ben thought of. it will depend on the circumstances as it depends on reality is. realistic objectives come there are three better part of the doable. one, to reduce administrative costs. there is tremendous waste or cost in the distribution of insurance particularly in the ninth group and a small group and that is clear they

a target that we should improve. secondly to improve consumers shopping and buying experience and in particular and the non group and a small group and of the market by way of illustrating this comment to this day four years after every got up and running we are stopped and thanked on the street by those who use the health connector to buy insurance because instead of spending half the morning to be on the telephone to compare insurance policies from four carriers then come away with scribble boats they can go to the website and within three days 30 minutes they can compare and push a button pretoria would not underestimate the importance of success and implementation just being able to serve your customers well. finally, adding some of price resistance to the

premium setters on the health care side. most of the cost a price for they do not control better generated by pharmaceutical companies and doctors and insurers through managed competition and choice, we may be able to add a little price resistance and some fortitude on the part of the negotiators had take that to the administrative efficiency for what they retain of premiums as well. those are modest goals. now to how to approve for work with what we have, i would say there are weaknesses in both bills. industry resistance. and exchange is the automated store for insurance broker you don't run a store if you don't have products. there is typically no way to compel a producer to sell through you. even if you require it

unless you close off all of the stores. they're pretty good at finding the store they want to sell through. what is their resistance to an exchange. you can do with it through making an exclusive channel that is one way certainly that is practical for a non group that is impractical for group insurance, a small or large. make additional segments revolutionary see if the changes working or build on the track record or in fight to participation, both customers and producers and provide for some flexibility particularly when you get beyond the non grupo market, the small group is a local market and is different in every state and there are provisions in the house bill i am convinced will end up having absolutely zero small employers use the national exchange. we can talk about that if

you want. adverse selection is a major issue. this is a whole complex option, the new rules, all of these incurred adverse selection it is the easiest way to make your bottom line be positive. one way to counter that is too exclusive channel for nine group and risk adjusting within that. a second way is claims based risk adjustment but it has to be across the entire market segment if you adjust for small group it is not just in the exchange but across the entire market. finally coming back to options, forgoing the large group market if it is an option two and they can do choice themselves, the only large employer is likely to get into the exchange are the ones that somebody else one's. cost control tools, selection is critical

the house is clear on that. standardizing benefits over time and this comes back to the fact that in massachusetts over three years the connector has come to standardize benefits but in 2007 when restarted we did not know which benefits would sell or designs were preferred. we had to the ball to standardize benefits then automate, automate, automate there is administrative inefficiencies to begin truly. turning two the house legislation for a minute come i think one of the problems that to referred to is the market insensitivity. that is only one of several reasons there is likely to be zero small group participation and exchange currently envisioned. another reason is all

premiums should flow directly from carriers that is why a the employees and has five different carriers is a nonstarter. i suggest focusing with the strength of the exchange which is a non group market, less complex and geographic portability is critical. most small businesses do not change the state's two delegates and decentralize part of it is clearly hampered by the focus on a washington-based our national management structure. finally emphasize the customer experience. again, this is where policy its reality and for the backlash will be real and tangible for that awful monster created in washington and does like an insurance what i go online. second late there's the issue versus retailing. the house of vision is for

the exchange to be a regulator the and the senate suggest and maybe that can be done but there can be a limited set of goals a considerable amount of independence that'd ministers says the health choices administration to figure out what works and boardifferent things and not e of directors with senators breaux i suggest minimizing the policing role in q1 to sell insurance which is the mission. then you have to be somewhat less of a policemen and maybe that means regulating carriers thursday divisions they and a national exchange which is trying to regulate the producer borrow it sells the product. finally, customer experience is potentially a weakness in the house version and the

flexibility of phasing yen -- been not to prescribe every element of transparency would be very helpful. turning to the senate, i think there are a number of problems and i will add scale economies is clearly one. there will be more scale and as a web based electronics store the fixed costs are pretty substantial and the scale it is critical to administrative efficienc and national is bigger than state, but you can make that the exclusive channel for the ninth group. that is worth in massachusetts would be 300,000 people and at that point* even a modest sized exchange has 90% of the economies of scale you can get out of volume. 300,000 is pretty good. you don't have much in

incremental savings from growth. developing national utility function a tool that the exchanges can use. geographic portability. people move then split their time but the key is to have a national plan, not a national store. that is the key and that could be supplemented by a reciprocal arrangements among the regional plan and by standard seven interoperability among the exchanges. and consistency of performance is a problem and there is conventional wisdom things noted on the power point* but i would say dependence on state interest come energy and support and resources is somewhat of the ickes deal. there is of view to have the fed stepped in the coming to characterize the entire reform effort there is a realistic prospect some states will do everything

they can to make it this fail to be blunt. and depending on them to run the exchange could be problematic. finally, i would turn to resurfacing and devolving exchanges. we're entering into a point* of maybe at the staid decade of figuring this out. so some degree of independence to figure out what works and focusing funding i like the senate version which is much better tied to sales as a surcharge of the premiums with the transaction happening. that focuses on most of the core mission to get up bunch of people injured. secondly, a clear objectives by flexible means. we just don't know there is so much more than what we do about how these things will

work looking for electronic transactions, there is a huge wash of billions of dollars in addition two and a very murky set to of auditing instructions and finally rigorous evaluation. i hope that is helpful. thank you. >> clarify knoll speaker is philip vogel is senior vice president at connecticut business and industry association. he is in his third decade of her and the services corporation and offers health insurance among other things to the thousands of members of the cbia. we also spent a dozen years in private insurance business directly. certified life underwriter for more than 30 years. his division has led the way

to set up a statewide health-insurance purchasing alliance that allows workers and the small business members of nt nine to choose among the several policies. we're anxious to hear the experience that you have had thank you for joiou. think you have heard a lot of good ideas from the panelists. i will repeat some of it also try to take you to the private sector. as we operated, be designed the connections under the clinton era under the managed competition model you could sell in exchange and people would make decisions based on price, network, satisfaction and quality. that is what we tried to do when we introduced our program. i will repeat some of the things because there were very good thing said but i will try to give you a view

into the private sector and into an exchange that has been running for over 15 years. cbia is a not-for-profit we run the program out of a for-profit subsidiary not which is how we pay our taxes for any services we provide. basically coming from a state that is very high and the insured really have the uninsured rate of 10%, we have very high mandates. we have a lot of other things in place point* we're able to compete in the private sector. nobody has to come or by through us. it is totally voluntary if a small business comes to us. we look at a very, very competitive marketplace and how we work. i want to try and take you through that and a five-year successful. i need to give you background in connecticut of

every team rules we operate under because those of the rules we're talking about in the house and senate bills. what we do in the lessons we have learned over time. and some of the opportunities. we introduce our program january 1995 the employee choice model that means we have four health plans we contract with an each employee can choose from one of those with a wide range of benefits from those companies. over 5,000 companies and some 5,000 members in connecticut that participate. one of the things we have talked about that john emphasized is looking at adverse selection. the hallmark of the program we tried to standardize the benefits between the plans a week ahead avoid adverse elections we have come very

close to having standardize benefits starting on day number one in 1995. as i said, we try to determine and set the program under managed competition based on price, network and things have evolved people make decisions based on the formularies and the satisfaction rates but unfortunately over time we have the objective refer started to have quality data that patients and individuals and employees could make decisions and that still is not available at this point* in time. why have we been successful? of first we brought employee choice to the marketplace for employees and to employers but one of the things that we know is the employee's trust their employers. they want to buy their insurance through the employer and a trust them

but we have to make sure we add value to the entire marketplace to each individual, each company, each of the insurer's so the entire market gets a win-win. that is how we try to manage our program. there has been an evolution where we look restarted come every tried to set out specific rules. but we had to change you're medically over the last 15 years we have done this. health insurance is very, very personal and touches each individual, their families and each situation is different you need to figure out how you can attract and make sure your market to each of those individuals and satisfy their specific needs. we have stayed true to our mission the entire time on small business we did not get distracted and we stayed true to keeping our

objectives straightforward and make sure you concentrate on those objectives and not get distracted. from the private sector and i will be biased, coming from our standpoint, innovation and is the key. you have to be able to set out to be able to change and adapt. when we started this, we hired employees so we could administer our program. i said two things. number one, i guarantee two things. change and we forgot something. those are the only two things they were told. that has come true because we have changed genetically because you have to have the ability to change to go forward. selection issue, adverse selection when you compete in the outside the market, it is absolutely

critical that adverse selection is avoided and i will talk about the background of that as we go forward. what from cbia standpoint we look like one large employer to the health plan but we do everything. one of the difference is from our exchanges that we are the exchange in the sense we have designed the program and negotiated the contracts but also the administrator. we are actually doing the day-to-day operations in the sense we will do all the the proposing of what the rates would be and benefits of the company's books for a quote come mugabe will sell it, hold the enrollment meetings and a handle any of the billing problems come eligibility and collect and remit premium, one bill goes out to the employer.

we tried to provide everything that needs to take place through communications and to all segments served. we do differ from that standpoint. what have we learned? we have learned, the number one actually i think i skipped a slide that was cral let me come back here for a second. that is the rate basis weak pass small case reform law in their early nineties and that gave us a community rating so there was no decisions that could be made based on claims no great bands are nothing so we have adjusted rating and guaranteed issue and guaranteed renewed ability and we do some brking factors with age and area, etc., etc. that can change

some of the rates and the reinsurance pool behind the scenes but this piece has been very important for us and helps with adverse elections of the marketplace is not trying to make decisions based on risk that is why it gem has talked about. as a backdrop that has been very important for us that is what is included in the federal house and senate. >> some of the less sense as we move forward, i talk about a little about the adverse selection retry to avoid from day one. if you're looking for administrative expenses and just to save expenses we have a real problem because

even in the bills they talk about in that group marketplace 85% loss ratio ratio, even if you save a little bit there you are not hitting the 80 or 85% which is the claims dollar. you also have to figure out how can we change the risk profile underneath to look at the claim this side? i have a problem putting the loss ratio and there because it stifles innovation and the ability of companies to invest in what they would do with managed care or help drive down the claim cost we are talking about. i can comment later on the variants is the we have not allowed any in our program whatsoever and we look to make sure we're consistent with what the market does outside of the exchange. some things to think about, some unintended consequences.

we use that all the time for what may take place if we make certain decisions. i really think the age pieces the house has two /1 great bay and on pricing of the senate is talking three /1. that can be a problem unless there are very strong individual mandates because if individuals or small businesses start to drop out of the marketplace those that will drop out is the healthier risk and real end up with a higher risk pool higher rates, higher health situation apple liv -- leave us and a major problem. there are problems to figure out the subsidies and just when you take a look at multiple funding sources and for the dollars come from to handle part-time employees those will be situations. the risk adjustment premium

redistribution becomes an issue because if you redistribute premiums it is tricky because you may be redistributing premiums to a carrier not as the fish shampoo working on the risks and reducing the risks like they should be and reduce prices. and there is minimal focus on wellness and behavior change. that is a big piece that john and i were talking about. but the culture as we move forward, we have to look at this how we bring something to the small business and non group market large companies are doing today? they are trying to figure out how to make a healthier population, how to invest and reduce risk within their population. it is very, very difficult we have companies in connecticut that we talk to

better doing this the large company trendline has flattened. if we don't bring that into the small-business market, we will exacerbate and continue the problem. i have a couple of questions for you. not a show of hands but they are touchy. i would expect everybody knows if i said how many of you know, how much you weigh? most of you would say i know that but how many of you know, your numbers? how many of you know, your blood pressure, cholesterol, hdl and ldl? glucose? b am i? and body weight index? as the go forward rican not just look at administrative expenses and say the change will only reduce expenses it needs to do more and move forward here to have to read

change the underlying population, the health of the population if people have multiple risk factors have we get that reduced? we have to look at that as a move forward something i am not hearing much about and something that is important as we move forward. >> now we can join the conversation. you can go to one of the microphones or fill out a green card and let me take the location rally way to for our audience to invite any of the panelists to like to make additional comments are responses to do that now. >> three quick comments. i agree with john that the small business part of the exchange in both the house and senate is problematic. and other than the very obvious thing like the size

of the groups that participate when you get into the details of how will this work, it gets complicated and the senate bill seems to be fleshed out but the problem specifically identified rather than through the exchange is a budget process the cbo put out a memorandum how it will support health care reform and one of the things it said of premiums are paid through the exchange that becomes revenue and expenditure through the federal government that means and sudden the cost of health care reform has gone up dramatically. i am sure congress just did not want to go there but it will be very problematic particularly because every individual as i understand it will be individually underwritten with the rating factors that remain that

means it has to retain a different premium from every employee based on the factors that are included. just to respond to that i agree that is a problem but that is why it is their purpose second the with respect to the of medical loss ratio the house bill i believe it is true in the senate bill as well they are defined to exclude the cost of improving quality of care. doozies management programs will not be considered to be part of the administrative cost. there is some room for flexibility and innovation. with respect to grow this incentives the senate bill includes a number of provisions to encourage plans participating in the exchange to provide various quality incentives and also

one of the things added by the manager's amendment is a provision for funding of small businesses to provide a bonus programs. one of the problems that i have and a lot of us have is focusing excessively on title one of the bill and for getting the other eight titles but there's a lot on prevention and wellness, some of which will help out small businesses. i want to point* out those things and to think the other participants because i learn so much when you talk to people who were actually doing this. >> back to the first point* of the cbo grooving on the impact of the premiums it exchanges i read it this morning on their way down because it is a critical

piece of technicality that i am in no position to disputed by if that is the controlling consideration i do not believe there will be small group involvement there are congressman that look to the exchange frankly as a bit of a panacea for small group for small employers i would read this as clearly indicate under the senate version and where states are given the option to brian premiums through the exchange where there is a broad range of benefits benefits, under that construction the premium private sector would not be on budget the revenues would be offset to and only then that is on budget.

but the larger point* of course, is however the cbo technical reading is resolved, one cannot look to the exchange which is the automated yellow pages where competition and choice for small employers. >> there is laing bridge that says even though expenditures are ran through the state to the administer under federal direction the states may be considered as agents of the federal government so i am not sure the senate can completely avoid this but there will have an easier time avoided to run it through the state's 72 see the whole program driven by that. >> the cbo bruins a lot of things. [laughter] >> i have picked that up. >> folks are at the microphones identify yourself and ask anyone to be as brief as you can so we

can get to as many as we've personally can. >> how the exchange's affect the public and private funding for abortion coverage? >> under the senate bill exchanges have to provide at least one plan that does not cover abortion. beyond that and in the senate bill or house bill there is a provision they had to had one that did or did not and that came down in this tupac amendment. beyond that, i think the rules for abortion are the rules for abortion and the exchanges are not involved in them. >>

>> the only comment i would make as a prospective of a retailer, the requirement to resolve the fundamental issue that the store pack to products for one real product and plant twice come ago and two days supermarket the most critical resource is shelf space. when the issue is take to next to each other for every hundred different plans you made it twice as hard to shop. probably not a major consideration, but if you think of exchanges which is the topic of our session today it is a problem. >> we have tons of questions on cards which leads me to tell you that if you have the urgency about getting your question and asked, we

may have done a bait-and-switch be cut as you may not get it asked. you may have to stand up and we heard. let's start with a straightforward question, can you compare the administrative cost to the states in the senate and house bills? >> did ministry of cost in the house bill aren't minimal because of the state wants to run an exchange it can. it can pay matching funds for doing that. but if the state chooses not to run the exchange has no administrative costs and in the senate bill, the states are responsible for enforcing the law and running the exchange's. that cost is the cost is one of the insurer's as they do

in massachusetts. but the cost of enforcement is borne by the state is the unfunded mandate. the administrative cost is considerable. >> i would take issue with the unfunded mandate. clearly in the house version of the state does not offer the service it does not have to pay. a son clear what level of federal subsidies would be available from the federal treasury or budget to pay for a state exchange. on the other hand,, i think having the state that run exchanges and have to manage the cost of their services in a competitive market is a reasonable way and focuses the objectives of the local or regional or state

exchange on the fundamental objectives, which is to get people and assured. i actually would take some issue with the unfunded mandate. >> i was talking about the enforcement cost, not the cost of running the exchange, but, yes. >> let me follow-up as a related question that notes health-insurance regulated that the state level today. if it is created at a federal level, who would staff the exchange and how much would that cost? this anybody have a notion about that? i did not remember that cost estimate. >> the federal exchange's run by the commissioner of health choices which is a nude ministry shin created under the house bill. the cost of running the

exchanges is to be appropriated by the federal government based on funds collected from the penalty of the individual mandate. i do not know what cost the cbo has put on that. i am not sure there has been. >> how will the senate approach the 50 state exchanges work with the smaller states under a million population and? >> if i can magnify that, there is a new paper that i don't think we had time to put into your packets which asserts you need at least 100,000 lives in exchange to make it viable. >> a further problem that

the exchange is not exclusive and says the presumption is that a considerable number of people will say -- stay outside of the exchange's think he would deal with some very small exchanges that i think will have a problem of providing ensures with the risk pools and attracting enough that they can be viable in the small states. it contemplates regional exchanges but of course, the state could forgo and that said government were contractor run its but i think part of the problem is with the size of the viable risk pool. >> a pkk's business approach you have three sets of cost cost, the business functions setter variable to sell insurance, the fixed

cost, and then mandated function, dave -- unfunded mandate which is the regulatory and policing from sinn. and i would draw your attention to the fact it is really the fixed overhead costs that are largely where the economies of scale. when the folks are on the phone with employer xyz -- xyz explaining why they have to file the new form and why they can pay somebody's health benefits under federal regulation in horror the difference between ppm lower html or the myriad of questions that is a largely variable cost you could have paid

centralized person who would not understand the connecticut market and to the questions over the phone it would cost no more or no less. but the scale economies are some of the regulatory enforcement things are variable. we have scale economies of the rig the tory functions, website, corporate overhead, and overall management and there, i don't know about the 100,000 as a result will trigger point* for a risk pool but that experience did massachusetts is 50 or 100,000 is where you get it diminishing returns on that scale. if it turns out to be super do per stuff is bigger than any state exchange you could have a national utility

function whether the 7923 states don't step up they should make it available to those who have there on exchanges. >> i am with the national partnership of women and family and with the regional exchange we perform various exchanges how they reconcile the different state laws or ray team rules or regulations? to they have to harmonize? >> have a brief answer. that is a good question and is then minor scale compared to the same question for 50 states and one exchange. it is a good issue. to be perfectly frank maybe it has happened but i have not in a year of discussion ought with talks on the hill heard the in depth

discussion to harmonize national or regional exchanges with local or state regulation. in massachusetts we work hand in glove with the state. if we want to take an existing product off of the market because we standardize the benefits and we have both alluded to that, that directly impacts regulations on preserving access for the existing members of the product you would like to fund it and we were fed out in conjunction with the massachusetts division whether national or new england exchange to do something similar they have to do with 500 or six different agencies and a set of rules just around switching a product around the exchange. it is a good question and rectified nationally. >> any time we make changes

within our exchange even though we operate in the private sector, we take a look and talk to the insurance department and sometimes meat determine what we can do going forward and it touches everybody. it is local. as it plays out it will play out more at the state level but you have to coordinate with the state. >> i anticipate considerable standardization under health care reform. probably under both bills. but the house bill basically the way it works it does not nationalize insurance regulation but says the national government doing a national health care reform specifically the

commissioner for health choices is accountable and responsible for the enforcement and implementation of this law. then there is a lot of language about coordination, a joint effort with the state's to try to implement the law. number one, lot of the issues currently addressed by the state marketing and consumer protection laws are addressed and will become there the before they do not preempt state law but they do cover a lot of the areas that are covered by state law to the extent it would prevent the implementation that it is pre-empted. second play a lot of the difference among best dates under both the fifth state and federal law if the state wants to mandate coverage beyond the benefit coverage attest to pay for the coverage for anyone receiving a premium subsidy.

that will create a race to the door to get rid of a lot of state mandates. my response is number one we will see more uniformity between state law and federal health reform law was adopted. number two, in any event the house bill at least has the attitude of cooperation and coordination to work through those problems. but that is an issue. the fear i have is the reverse if you go with the senate approach, a lot of states are weak on insurance regulation and they will stay that way and be responsible and a number have already indicated they don't want anything to do with it but i am not sure they will opt out. sunday set their then see if the fel government will call their bluff and i think

that will be a real disaster. >> i agree with guarantees every new ability and the reit team rules and how you rate will come together but some of the pieces will be far apart. connecticut is one. if you talk mandates we talk about that all the time there is a high of this stuff mandates i have been the business a long time and i have never seen one mandate reversed. >> will they be willing to pay out of their own pocket? >> i don't know. >> let me jump 10. [laughter] i am shocked to begin to realize two seriously began after enactment if we should have our own state penalties for violation of untaught and in addition to the federal. that this house a gross

st. the way the state's think even if there is a lot of good will and the legislation with minimum credible coverage. i am sorry. federal irs enforcement national standards, we have our own in massachusetts i have just began to realize how difficult that conversation will be with their governor and legislators is do we see that to the federal standards or on top of that? after all it is a revenue source for the state treasury right now. >> i have two questions. first he mentioned undocumented workers could not purchase an exchange but could you talk about what options might be available to them if they want to go for private insurance? is that a possibility? if the tax exemption

benefits went away in the market was forced into the exchange how you think the benefits could compare with that the better or worse off? >> could you repeat the second question? >> if the tax benefits went away and hypothetically people and a large group markets lost benefits and went to the national exchange how might consumers fare as opposed to getting benefits? as opposed to the first question under the senate bill, presumably undocumented the hope is they will go home. [laughter] which i think is unlikely because i live in a town with a great many undocumented workers. but under the senate bill they can