mandate will go anywhere. a lot of constitutional law folks don't think these challenges will go very far. is possible they might fade away as legal challenges. i think the real pressing concern is the states with political leadership is not going to be doing enough to make sure that the law works. not encouraging people to observe the mandate and possible the system isn't going to work very well in their state. .. challenges in my view. host: rayon the independent line. guest: i enjoy your show. i have a question about workman's compensation. businesses are required to furnish that for employees ysm not let the employee pay half the cost and go ahead and extend workman's compensation to the entire family and they get 24 hours a day, 7 days a week? >> well, once i finished this

book and read the law, i don't think worker's comp is included in the law. there is a lot in the law i should add that is intended to help employers, especially small employers. one of the first provisions that that is it is going to affect is a fairly substantial credit that that is going out to small businesses to help them buy insurance, businesses of, i believe, under 25 employees or it might be -6b 0. i will have to double-check, but they're going to be getting credits, businesses that have employees making under $50,000 a year on of average. this he will get fairly large cred its to help them buy insurance. there is a lot in the bill for going beyond that and try to ease the burden on employers. the employers will be rieshed to provide coverage, employers of a certain size, of 100 employees or more will be rieshed to

provide coverage. it is worth noting that most employers of that size do provide coverage. it is in the small business sector that you see a lot of non-coverage, and those smaller businesses are not going to have to provide coverage. they're going to get help to do so but they don't actually have to. host: don on the republican line. caller: good morning. could you sort of explain specifically what it is that the attorney generals are actually suing for? i think there is a misconception and perhaps maybe you can clear it up that they're suing to reform the healthcare bill. host: to overturn it, you mean? caller: correct. but what they're actually dealing with are specifics of the bill that actually mandate that the state is going to have to pick up certain medicare or medicate patients as well as the fact that the national government, the federal government is trying to mandate or tell individuals that they have to have healthcare.

guest: good point. they're raising several different claims and some states are raising some claims and others are raisings others. some are just objecting to the mandate saying that the mandate that we all obtain insurance is unconstitutional. some are coming it from a states' rights standpoint saying it is unconstitutional for the federal government to require states to set up these new marketplaces, and also, you know, not right for the federal government to take on more medicaid patients. a big part is that we will expand medicaid by a lot, by about 15 million people, expand it up to 133% of the poverty level. anyone below that level is going to qualify for medicaid. it is worth noting and this has gotten lost a lot in the discussion that a lot of states that right now have stringent medicaid threshholds, basically the states that don't let a lot of people in to medicaid, they are going to have to be sened a

whole lot more people into medicaid which they're very worried about but they're going to get massive help from the federal government to do so. right now the federal government picks up only about 50, 60, 70% of medicaid costs on average. under this new law, all these new people coming into the medicaid system will be covered at 100%, the federal government will pick up the first couple of years and that's going to go down to 95% or so over the next two years so states are going to be getting just tremendous surge of federal dollars, and in a way it is the states that have the most stringent medicaid eligibility until now that are going to be making out the best because they're going to get all this federal help to pay for people who noth ore states, states that have been more generous, those states will be getting lower reimbursements from the feds to keep covering those people. host: brenda on our democratic like in north carolina.

caller: good morning. i've got a couple of questions i would like to ask you. i went on-line on the internet checking insurance companies to see what was available and the companies that i talked to were more like discount insurance rather than insurance with major medical. i do have preexisting conditions, and i need to know is the state going to set it up with the major medicals along with everything else so i can get insurance? guest: you're really a classic example of someone that this law is meant to help. come 2014 -- i know you're dealing right now in the present, but 2014, the whole idea is that you are going to have a much more sort of easy to use and easily understandable marketplace to go buy insurance. you're not going to be out there alone on-line going around

looking to see, gosh, is this what i need? what does this provide? right now, as you know, it's very difficult to figure out this marketplace on your own, especially if you're in a state that is not well regulated. come 2014, it's going to be like really kind of easy comparison shopping. your state will have this new marketplace where it will be all transparent. you will have cheer price levels -- clear price levels, clear explanations of what each product gives you. that's how that works. in the interim, your best bet will be the high-risk pool that will be set up to service a bridge. as i said, there is real concerns of how that's going to work but hopefully it's going to work ok for most people in your situation with preexisting conditions. host: david in clinton township, michigan on the independent line. caller: good morning, america. i heard a woman call in and said she was attending tea bag

parties and then she started to say she was complaining about her medicare coverage. now, if i'm not wrong, these tea party conventions rally against socialism, and medicare, social security, farm subsidies, those are all little bits of socialism that america has had all along, so i know that -- how can you suck on a socialist tit and complain about socialism but then most tea party members fell off the republican bandwagon so hypocrisy is in their playbook. host: former republican donna in augusta, georgia. guest: good morning. first thing i would like to ask you a question about, i'm on medicare and medicaid. it's hard for me to find doctors now. some of them won't even accept my medicare. also, the doughnut hole, it

doesn't start until ten years, right, and the other insurance doesn't go into effect until four years, and another segment of my statement i would like to say is i'm losing my cardiac thoracic surgeon, the one that has saved my life from cancer four times. i also have other doctors that are retiring because of the healthcare bill. could you comment on that, please? guest: the -- you're right. there is a concern about doctors , access to doctors and doctors accepting medicare and medicaid. right now, as you know, it is more of a problem with medicaid. medicaid rates are lower than medicare reimbursement rates. you are seeing doctors stopping accepting medicaid patients. the law does try to deal with this by increasing substantially the medicaid reimbursement rate for primary care visits to doctors who get paid more.

basically they will be brought up to the medicare level from what had been the lower medicaid level. as far as medicare goes, there are some doctors who are no longer accepting medicare patients but it's been somewhat overstated as a problem. it is with medicaid it is more of an an issue. as far as the doughnut hole, you may have misunderstood what i said earlier. it phases in the closing of the doughnut hole phases in over the coming decade but it's ramped up quickly. you will get a $250 check in the coming weeks to help with that if you're in the doughnut hole and then it starts closing. the window starts closing right away, in the next few years, so i have to double-check, but i'm pretty sure that within four years or so, it's going to be down to, you know, much, much smal

the genetic scientists who nailed a rough date for when the hiv epidemic starts describes tinderboxes and wet mops. in most parts of the listeners not that much hiv and in some places there's a ton and it's incredibly destructive. so understanding that these two categories exist allows you to think, okay, what are the factors that keep this virus is ineluctably do with the world to end their?

>> and on booktv, jonathan gruber presents his thought on health care. consulted with congress and president obama on the creation of the affordable care act signed into law by president obama in 2010. this is just over an hour. [applause] >> i'm really not the entertainment tonight. i'm here to enjoy myself. i appreciate you being here at town hall tonight. we have jonathan gruber here to speak. jonathan is an award-winning m.i.t. health economist and director of the health care

program of the national bureau of economic research. he was a key architect. one of the things i ran to her to camelot when he was working up in massachusetts cannot help in the massachusetts people put together their reform. he has also worked with the administration and congress when they develop a health care reform legislation that was passed about two years ago. he is also coeditor of the general public economics and associate editor of the journal of health economics. he is published within 125 articles and has edited six research volumes. he is author of public finance and public policy, which is the leading undergraduate text. which is why he speaks with great authority about the law and what he has done has written a book called how scary worm: what it is, why it is necessary and how it works.

i think it is a very fast, but also formative read. so please give a warm townhome welcome to jonathan gruber. i'm not [applause] >> thank you very much for the kind introduction. i have about 10 minutes to start and there's a lot to talk about what health care reform. so i will tell a little story. a younger sister come into our lives here in seattle mystery moser. the story is that one time she came running to the house and found my father said that on the deck, where his mom any to talk through my father said i don't know where she is can help you should that noah started to walk away. i thought it said what you need help with? she said i need help with my not so marked. if others a phd in finance and was a bit taken back she didn't

want help with her math homework from him and she said why can i help you questions that i don't want to know that much about it. [laughter] so in that spirit i will try not to tell you more than you want to know in the opening few minutes and rather that what you want to know, but my conversation with rob and your questions, which i'm eager to hear. i like to start by sending a little bit of background, which is to really understand the importance of where we are historically in terms of the numbers. historically we have been trained as a nation to do fundamental health care reform for about 100 years on average every 17 years restricted to health care reform in. and was always failed in till 2010. msb failed the problems have gotten worse. the number of uninsured america have grown reaching 1500 individuals in the cost of health care has beginning to grow. we have goodness of health care spending resourcefully last year

and more slowly means faster than the economy. we are still increasing health care to 18% of our gross domestic product. if nothing is to make 28 jicama will stand for in every $1010 on health care peer 100 years after we'll spend 100% of our economy and health care. that may be different doctors in the crowd, but not really good for the rest of us and not really feasible. in a book i represent them as a two headed allocator that we are trained to deal with and yet we have been unable to decide to deal with them. the real breakthrough here on whether or not he likes it, the hero of our story is mitt romney in the breakthrough team in massachusetts in 2006 when he sang into a massachusetts health care reform, which took a new approach that had been tried before an approach i call incremental universalism. incremental borrow from the right, meaning leave people alone if they like what they have, but how people if the system doesn't hurt. universal borrow from the last

time i meaningless get universal coverage. this has not been tried before. this is not a rip it up and start over approach. the state must recognize politically we can't take away thinks people like to get to universal coverage. he set up a system which i like to think of as a three-legged stool. the first leg was to end discrimination in the insurance market, two and a flawed system in america where people are just one bad gene are one bad traffic accident away from bankruptcy. the second step was an individual mandate so insurance companies could price insurance fairly common selling into the newly reformed market. and the third step to subsidies with health insurance to be affordable for individual mandates. the system was put in place in 2006 in massachusetts and has been enormously successful. we've covered two thirds uninsured in the state to lower the cost of health insurance and are not employ nonemployee market by 50%.

this was the basis for the federal affordable care act which after much doing a fairly passed in march 2010. the same basic structure in the affordable care act. but the affordable care act is more ambitious and two fundamental ways. the first is kennedy romney may not tell you this, but his bill is paid for by the federal government. so we did reform would it not to raise taxes if he will tell you. but the federal government paid for it. the federal government is not that luxury. it's not like china will pay for health care reform. we didn't have the luxury of someone else paying for us we had to raise revenue. that was one place and had to be more ambitious and they can talk about the revenues and where they came from. the second is the bill in massachusetts is not about the secondhand of may 2 headed allocator must not about cost control and not about dealing with this more important problem in the long run, which is controlling health care costs.

and here to tell you that it's okay. that is okay because it's a lot harder problem. a lot harder problem. but a problem that are moving toward solving. we're just not there yet and in a situation shine china forward in the affordable act was slower to train control health care act which altogether will not really be the last word on cost control. but which moves us forward towards ultimately controlling health care costs and not ending up spending 40% or% of gdp on health care in massachusetts in which the bill is more ambitious. but my book does is really go to the background, go through it have been a massachusetts and in the details of the affordable care act in the hopes that we can talk about details and answer any questions you have. but that is an overview of wanted to provide analogous to talk with bob and hear his questions and hear your questions. for thank you.

[applause] >> well, thank you very much, jonathan. i think this is an interesting topic you brought up. a lot of us care about what our health care system looks like, feels like. you mentioned one thing right in the beginning has to do is incrementalism versus a broader suite. could you speak more about why incrementalist at this time, why not a broader sweep? how could meet our goals? >> you know, the historical pattern is interesting in that every round health care reform needs to propose an approach to the right. every round from a single-payer propose to some of the single-payer to the clinton system which has regional cooperatives do so would've fundamentally reconfigured the health care system. i think what was realized in this round was two fundamental problems of trying to be completely figure the health care system.

the first is most americans are happy with what they have. they get their insurance from a large employer. they wish it was cheaper but they have very few choices. the employer picks up most of the cost of the don't realize the cost and they're pretty happy. in american politics you don't get far by ripping up with makes 200 million people happy to make 50 million other people happy. the sickness real estate than a hundred billion dollars insurance. we build the industry is much smaller than that. we're not going away for $800 billion private industry. we have to bring them along to make it feasible. those two recognitions led to this approach. it lead to realization by many who had a dream of a single-payer system that was happening in the near term and we need to move towards a system that is politically feasible to pick it up to the fundamental goal of universal health care coverage. >> very good. i know a lot of us care a lot about continuing that. one of the issues that you brought up how much is really

important that she said with a two headed allocator. he mentioned they were working on the access issues, but really there's also the cost control. you mentioned in massachusetts you didn't bite on a work, but she did in the national. how much is going to be successful? what has to be done? >> guest: you know, bob, health care cost is hard. i think that it does have a two hills to get to where it going to. the first so scientific, which is quite frankly a lot of good kids out there. we don't really know how to bend the so-called costs are, how to slow the growth of health care costs in a way which not put the u.s. at risk. we can to say we're not spending spending more than 18 are sent of gdp. that would do it. but that is not an effective solution when we know it does improve health care. a lot different, like this. how do we distinguish what does and doesn't.

and we are claiming it. the second and fortunately as the politics which is this is a very hard problem to solve because anytime you post something, which can help control costs, it's easy for the opponents to attack it. our political system is just not prepared to do with this. so my favorite example was miniview may remember in november 2009 and this is really in the heat of this debate, the preventive task force, which is the independent set of doctors who recommend when you get your various site recommend mammograms no longer be recommended for women and 40s. this was on the economic state decision but on the psychological cost of other false positives are getting versus limited benefit given the advanced treatments we had. will the political system anyway with a recommended list. the government wants to take away mammograms with the headlines. this is not a government agency

and are not taking away anyone's mammograms. it's bad enough if you read the affordable care, which i recommend you do not, it actually says one of the early deliverables of the bill is preventive screening is not covered for free. every american now has the right to get screening for free. when you define in the bill as recommended by preventive services task force before november 2009. so they literally couldn't buy the bullet because of the blowback. that's a tiny example of how her politics are here. it's a long-winded way of saying we have a long way to go before we get to fundamental cost control. but this bill does is take what i call the spaghetti approach. it is a bunch of staff against the wall and see what sticks. he takes yourself and others on the best way to go forward on cost control and try and see what works. >> how are we going to make sure we get this? >> guest:

>> there's a famous quote from herb stein decided something must hand, it will. eventually we would get there. we will not than when i% of gdp on health care. i honestly do not know. i cannot tell you today how we will get there. i can tell you it is very unlikely we'll get there in the wake of her example that england did come up for no one over 70 transplants. that is not an american solution. cannot see that happening. i see is ultimately moving to an explicit two-tier health care system. right now is an implicit two-tier health system. if you're in the system and educated with high income and typically nonminority, our health care is as good as anywhere else in the world despite what people say. all statistics are driven by people out of the health care system. so right now we need to move to an explicit two-tier system in my view where we guarantee a minimum. everyone is guaranteed good, basic health care. we have to recognize that if

america. that is where your pet to most european countries can buy it at the public system with two out dollars and buy more generous health care. we need to move towards a system ultimately, though we're far from from getting there. >> we move quite big. ground of revenue. you mentioned how massachusetts was lucky to have $350 million coming down the pipe. the national bill did not have that. the national bill also raised a lot of revenue and that is good for the gd protocol for deficit is decreasing. can you tell us about that one actually does happen? who gets taxed, who pays for a? >> president obama laid out as number one principle on this villainous enough place to start that they should not increase the deficit. that is a critical component. we had to spend about a trillion dollars. over the next decade we had to

raise and reduce spending revenue. so what the bill does have several things. first of all that cuts excessive reimbursement to enter the medicare population. under the bush administration we were paying private health insurance $1.15 on medicare recipients. every expect $250 billion. we raised another $300 billion by reducing reimbursement to hospitals to treat medicare patients sahhaf with custom spending, but half his increase in revenues. this increase in revenue come from two sources. one is the taxes on the factors that benefit the most from the sale. we are treating 32 million new customers for the pharmaceutical site or come in the medical device sector in insurance sector and the wallpaper excise taxes off the money of the customers. the second is a new tax on the wealthiest americans and increase in the medical payroll taxes for families with incomes

in $250,000 to >> you mention pharmaceutical industries to help insure, just from what i know the american public still really like those people. does this help them become better citizens? >> i think it does because the trade-off the political feasibility argument is because they do bring private insurers along and i know that upsets a lot of people. the bill tries to make them better citizens into very importantly. the first is the use of the health care insurance exchanges. brain if you want to buy health insurance in the so-called nonplayer market it is a harsh and unfair marketplace was hard to shop effectively. it's confusing, prices high. this sets up exchange for a nongroup insurers will come and offer a common pop from on the web which are easy and competitive to shot. your interested liturgy to go to health care.org. it's a terrific shopping experience and beats the pants of orbit.

peacekeeping is when people shop across well-defined products, that is an competition can work its best. who will be fresher on insurers. blue cross churches with another insurers because they are blue cross and people know them and they have a good name. when they are on the shelf with other insurers, they say wait a second those are the same. winemaking 5% and 6% extra. that's when you bring the cost down to the second feature is important and is called a medical loss ratio, which regulates the share of money insurers raise and they have to the medical care and limits how much they make in insurance overhead to limit the extra money to the sector. >> i want to get a couple parts of the bill that i think are important. what are the things people don't trust insurance companies and that is not just transparency, but how they make sure they don't get eliminated because they are sick and people don't have limits to keep them from

getting pushed into bankruptcy or something else? can you talk about the protections that are there click >> that is a great question and i think this is the most important part of the bill in the least appreciated. most people in this people in this room will have insurance and their employers are from the government. but we have to recognize is for the 50 million uninsured americans and the many more -- the many individuals in the nonplayer market are facing an enormous risk to their financial security. we have a system in most states such as the sun we could have brought insurance for many years in the minute you get sick you can be dropped or sometimes they can't do that so insurers they find they can trap you. that's $1 million a month. totally legal. we don't have real insurance for people who do not have employer insurance or government insurance. it is a fundamental failure of an economy afloat these hours. it is crazy to put that.

this is that. no longer be denied insurance because they're sick or to be kicked out because you're sick and no longer the sick church more than healthy and that to me is the single biggest contribution of this bill. >> it is very helpful. on the area prevention eventually have clinical prevention but we also have community-based intervention which are very important and if you look at the health of the community often times with much more will be doing our community as opposed to just a political intervention, which is built to and is it really making a difference in the sirius? >> bill is trying to make a difference in the sirius. what is the bill due? it puts money in the resource health centers to try to hurt the ability of community health centers to meet the communities. there's a lot of money for individual-based prevention. money for wellness initiatives and basically trying -- with the bill tries to do is not just ensure people the building resources to improve people's health above and beyond medical

care. >> i talked a lot to conservative people who are very upset about people getting entitlement you have a gift or something given to them. the issue of personal responsibility lies not population all the time. how is the ability rest of the person of responsibility click >> it was fascinating because that is the genesis or the individual mandate is a conservative idea. the genesis was a conservative think tank in within romney signed the bill on the podium with him as a spokesman from the heritage foundation saying how wonderful the bill was because that is about personal responsibility and ending the free ride for individual something they're sick and jump out when they're healthy. this bill is trying to thread the needle, to try to thread the needle of using individual

response ability for not putting such a burden on people. so for example we have an individual mandate, but we offer large tax credits to low-income people can afford insurance and we have an affordability exemption so no one has to pay more than 80% of income for insurance. if it costs 8% of your income you no longer such a demand peers once again it's the giant bouncy night. as he said in the green room and says if you think you shot a bullet through a dozen people made it through without hitting somebody. it is trying to do this amazing balancing act between addressing the concerns and making sure to generate enough system to work. >> you read a book that is actually i do want to say a comet book, but a graphic novel. why? >> a couple of reasons. a publisher pressure and said we think this is a great way for people to learn about the health care bill. i was very eager to help learn about the health care bill because you read the post enough people, what you think about the

affordable care act and people say they like it. what do you think about ending discrimination insurance market? what do you think about making health insurance affordable? and people liked it. they just didn't understand it. so looking for a way to help people understand the bill. the publisher said look, what way is when you're on a premium on the plane is going down? injury comment. dakota to learn. my son who is a big reader sent this is a great format for people to learn and really convinced me to do it. so that's why did it. >> i did not have that man. >> i really enjoyed it. next to. who's the audience for this? if you think is really going to read it? what difference does it make? i really have in mind the

audience can beat anyone with an open mind about this bill. cannot think of a change the mind of anyone whose mind is made up, but this is a really radical transformation of our system. it is confiscated and a lot of people are confused because information and disinformation about the bill. so is appealing in some sense to two groups. one group is people who are ranging from cautiously skeptical to cautiously supportive but just ensure and they want to read it and learn and decide for themselves. i also quite frankly have a particular audience in mind, which is the people who are very much inclined to like universal coverage, to likely democratic president does, but just feel it built-in get there, just to meet their needs. they're just not satisfied. i'm stunned at the number of people who don't support the bill. i think a lot of that is people not understanding what the bill does and what is in it. that is a specific offense of

late to reach for this book. >> before i get to the next question, i'm going to do one more question i would like to openness to the general audience here. i think we have two microphones. when they are at one over there. so if people want to start asking jonathan some questions, these feel free to line up. i want to go back to your whole area of rations and they won't call it rationing, but that is what the opponent bill calls. with things like competitive research, which means comparing what we're doing, whether it works or not and you mention the two tiered service system. how are we going to approach health care in the long run as far as split -- there are limits to what you're going to do. it's an aco, different mechanisms built into this, and they going to get into that? how were we going to make hard decisions and inform ourselves?

>> guest: this is what is really hard. basically we think about the coverage problem caused problems, the coverage problem with certainty what to do. there's just a matter of craft in a way to get through politically enough that the bill does cleverly. the cost problem is much harder because we just don't know. we just don't know what works scientifically and pass politically. so what does the bill due? you mentioned compared in effect goodness. health care is the single largest single fastest growing sector of the economy and we have no idea what works. we don't know what works better than why. it's crazy. so what do you want to do in a situation? you need to research what works better than why to make sure. once you mention that he said would second that means the government were rationing care. the election says there's a billion dollars for the comparative effectiveness institute to study what works and what doesn't that the results are explicitly not allowed to be used in setting

insurance decisions. that's crazy. it's useful with why to use its decisions because a political compromise. that is an example at the bill has been in dozens of pilots of alternative ways of organizing care. we have the so-called fee-for-service medical system, which is where doctors essentially get paid the more they do at the same as having a doctor decide how much medical care and the butcher deciding how much red meat you should be. we need to move away from not towards advanced care system where doctors are paid based on how healthy you are, not how they treat you. but that's hard to do. a famous health care economist says reinhardt, anytime you want to control costs go cut some of income is hard to do. how do we get there in a way that will bring relevant parties on quakes that is what we have to work with. the bill said dozens of pilots

that we can learn and evaluated come back and say hey this worked, this isn't. let's go for around two and then the cost curve. >> let me start over here. first question. >> and definitely one of the liberals who really doesn't understand the bill, so i'm delighted to your novel. thank you for that. i pay out of pocket myself for my own health insurance because i'm self would. and recently became pregnant and so got involved in the system even deeper. i was delighted with group health until i became pregnant and once there is a series of tests recommended, prenatal screening, et cetera i became a mired in the quagmire of trying to estimate costs up front what i would pay out of pocket towards that that i want to know, why is it legal i want to know, why is it legal for the health care industry for health care providers do not tell you up front exactly what you will be paying for a given service

prior to getting the service? what ended up happening is i ended up paying double what is quoted initially now of course i am fighting it. but it's a quagmire. i love your answer to that. >> guest: that is a great question and a great example of the type of -- first of all congratulations. second of all, a great example of the type of will be solving. i mention these exchanges. once again i heard you to go on and a house protector.org. but to see what is coming, which is the standardized benefits in a way where you go on and you'll see exactly what you're paying under each plan. if there is a deductible that it matters how much the service costs. that's a great question. i think what we need to do and what we need is the next with the description. really what you need is to go on the web and say what these services are global insurers charge me for them? if any of you have gone on and

guide in medicare part d drug coverage under medicare part d website you can enter which drugs you are using and they will tell you what you would spend out of pocket each month on each plan. so basically that's what a facility exists for all health care. with candle help consumers become better informed and shop more effect to blame. it's going to bring prices down. so you think will help in that sense. >> how is it legal the upfront costs are not stated overtly. >> i'm not really an expert on health care law. >> to get around by saying that a close estimate. >> i say honestly people don't know. nobody knows how much it is going to cost.

i was on public channel that we have like 10 plants. i couldn't figure out how to compare one versus the other. until you have some way of comparing an apple to announce full. over here, please. >> professor gruber, the substance of this conversation as we were interesting than politics, but i want to wallow in the politics for a moment if you don't mind. as someone who is there behind closed doors with mitt romney on this, i'm very interested to understand, w-whiskey and engage ceo participating in this conversation in a deep and thoughtful way? or is he would have us believe now, did he do this kicking and screaming and this is over his body? [laughter] >> no, and what was actually writing speeches for president clinton when of our previous commanders in chief, said he knows about the sector well.

so basically, mitt romney was a real believer in this. i really only had one reading with mitt romney. i work with a team to develop the plan and we went in. and in the meeting basically mitt romney was defending against his old club visors. he said he don't want to do this. this is a terrible idea. he said this is cool. the chart is a management consultant. and they had this unique phishing because are getting money for the federal government we can put together a system to a system to endorse a coverage without raising taxes and that's a republican he thought that was kind of neat good we can have a system with urso responsibility for the mandate. we'll cover everybody and not raise taxes. he was excited by the puzzle. and look, i'm not saying this because i'm a democrat. he honestly is the hero of health care reform. literally, truly we do not get the affordable track without

mitt romney. [applause] i realize that as a self-serving statement, but it's really, really true. i am as disappointed as anyone that is locked away from it the way he has. >> thank you. >> thank you very much for your presentation. your answers are terrific. my question is about the public auction, which died a sad death. and whether genuine cost control is even possible without a public option to drive it. i mean, you have discussed the sort of experiments that we will be doing, but meanwhile my understanding is that in massachusetts because they're particularly for private employers are rocketing at an unsustainable rate. so they have to be controlled for the program to work. can you cost control without a public option?

>> okay, great question about a guy came out. first of all massachusetts are risen at the national rate. which is fast, but no more, no less an employer market. they've actually fallen by 50% as i mentioned. the public option is a great issue. i'm a big fan of the public option because it an academic like myself. he had a great idea. he said the last single-payer, the right wants a competitive exchange. let's put it together and have a competitive exchange. with such a great idea that both sides hated it. and basically both sides hated it in a sense of the left didn't want unless there was a huge advantage for the single-payer in exchange. the right did not want to do is there at all because they were too worried it would be successful. the message i deliver tonight is to not get too upset and here is why. the public option was never as big of a deal is made out to be

because at the end of the day, here's an example like to think of. let's say there's three sellers and their each 20 minute away from each other. each of those sellers about full text not to worry about competition from another seller because there's no way to compare prices effectively so they can charge a high price goodnight said it before seller, which is 20 minutes from everyone else and they're cheaper. i will help some, but a lot of people still won't know about it, will drive there, will help that much. now you introduce a website to compare mine to prices about the apple sellers. that'll help a lot because i know where to before you leave. if you also have a map on the website will help more, but put them on a level playing field is the big difference and people are understating the importance of exchanges. as putting the fee to the fire and say and show us you thought a level playing field the alternatives. let's see what you haven't sudafed does.

if that doesn't work, we have to revisit single-payer. in the meantime don't forget we need the ability to edit a specific public option. covert status connecticut within its exchange, which is great to see at the public option is as good and useful as some people like to think. the messages and the public option is bad. the message is not nearly as big of a deal as it got made out to be. we've done the important things are putting insurers speak to the fire to be competitive and show prices in a way of comparison shopping. plus see how that works. if it does the work we will have to revisit some kind of single-payer system. this is the last best hope for private insurance. that is a period of the bill does not work him he cannot control health care costs under the structure then we have to rip it up and start over. >> over here, please. >> i would just like to know, is there anything that addresses preventative care and not just cannot make preventative care

care is in mammograms and screenings, but as far as nutrition, just as far as chemicals in food, sugar, and sent to produce all these things by companies? it seems like you have this good incentive on one side, but on the other side you have someone pulling any party cut some of these in place. without getting rid of these, how do you just play one on top? >> it's a great question that highlights the difficult bill which is principally all of that, but that would never get past. this is my frustration. my biggest frustration is not for how far away, but not going far enough. my answer is about as far as it could. a lot of big issues like that we need to address. the bill does some things as i said preventive screening. the bill also addresses a tricky issue, which is how does it depend on the efforts people need to take care of their house. on the one hand the bill allows bonus discounts. if you take care of your health

you pay a lower price. that is a good thing. on the other hand i becomes discrimination of health. saudi balance those two? the bill tries to balance between those two. what is doesn't do is take on three systems of the problem of food deserts and other kinds of production problems message system. other issues of sugary sodas availability in our schools and information about attrition. these are larger systemic issues to do with the legislation. the bill doesn't get into them. >> my question is, why is health care spending in the united states two or three times as expensive as every other advanced country with no better results? [applause] >> that's a great question. our health care spending is about twice the international average, twice the developed country average. parties because we're richer and bigger, but even though our

health care spending is on the order of a third higher than it needs to be, then you project based on the characteristics of our country. we don't really exactly know why. we know it is partly prices. we pay a lot more from things like prescription drugs. we pay a lot more for tax scans and mris to repair doctors more. not primary care doctors. specialists make a lot more. part of its prices, but that is not all of it. parties utilization, but that is not all of it either. many european countries they go to the doctor more than we do. in japan is twice as many prescription drugs as we do. the difference is what is unique about the u.s., domestic unique as this was the system gets a hold and squeezes and doesn't let go. it tessio, keeps in the hospital longer, disaster procedures on you and that is the quantity piece. it is about intensity of treatment once you get in the system.

and that is once again hard to know what to do with. many of you may have seen fit to go onto june 1990 article, the best thing ever written in my mind. the el paso texas. two regions which are very similar democratic competition, very similar outcomes to get mcallen, texas spent twice as much as el paso, texas. the reason is their sense of extra tests, tons of procedures. their stacks are in the books. all the extra stuff they do. the question is -- the problem is if you go to those doctors, they will say case-by-case this test is needed because they showed this symptom. they make a compelling case for each example. are we going to tell the doctors they can't do that? how do we tell them not? has a problem going forward. in european countries present because they control the prices of regulation and the just another history of excessive

irony into this problem. >> it seems to be one of the big benefits of the change is the ability for people to change jobs but they won't get shut out either from employer to employer and changing insurers or even the ability to go off and start a business of their own, but move away from employer based health care business of their own or they could go to one of these exchanges. has there been any work done to put a value to that, to the economy as a whole? people being able to change jobs to a job that they are better suited for? >> a question after my own heart. that is what much of my academic research was on was exactly that question, so-called job but could the question that people are free to change job. the best estimates are among the people in health insurance is a 25% reduction in the other change in a job just because people are afraid of losing

health insurance. that is an enormous problem. a positive source of u.s. without food or labor market is which are best for them and not possible from other countries. health insurance tied to employer spots. this one now. do not go to keep health insurance regardless of where you move. will be a major boom tour economy. so the specific answers we do not have a good estimate. the two new dual improve flavor of ability and people will not go to start new businesses and move to new jobs. >> tr reid noted we are the only country in the world to death for profit insurance companies. is that relevant to this conversation for all a slickly the same click >> it is really not relevant. i realize it is a hard thing to say, but someone mentioned massachusetts. our health care costs have no for-profit insurers in our state.

a sickly the problem is -- is by and large it's about there not insurers. there sabina airs. some of the bad actors will go away because we'll get rid of the insurance they saw. i'm so insurance which side will pay $500 a day for your stay in the hospital. people say $3000 a day does nothing. that will go into this though. we are getting rid of that kind of insurance. some insurers are in excess of profit in excess of a street of cost. that will go away with ross ratio regulation. with those in place come as truth is there is not evidence. it is for-profit versus not-for-profit that behave differently in the key elements that drive health care costs. the important thing is for-profit or nonprofit that the excessive margin and that will go away. >> he's right. >> so when these plans are set

up, we're looking at sort of prostatic health care system. yet health care is not a static system. i mean, they are new drugs. i'm not supporting the drug companies. whether as compared compared to about effectiveness, but again that is looking toward about the static system. health care is also also driving forward because we haven't cured most diseases. very few. so there also is an industry, if you will be at university or private industry. how will the bill addressed the ability to go forward in how will it be flexible enough to allow the appropriate changes to occur? >> it is a great question. there's two facts which are seemingly existing with each other, but really combined to

explain the control in health care costs. fact one is from 19 page today, health care costs of almost in the shared gdp. there's a great book on your money or less by my friend david harvard university where he documents how much healthier we are. health care sector 1950. let's be honest. your heart attacks or three times as likely to die within a year. babies are twice as likely in a year. health care is just a ton better now. that is fact one. fact two is released about a third of what we spend on health care. when people want to review charts of how people are treated in hospital but was necessary what was that we waste a third of what we spend. how can the increase in health care spending be worth it and yet we waste one third. the answer is the other two thirds is awesome. so basically the other two thirds has carried the wasted one third along. so that comes to this question.

that is where the answer is not to rolling a single no longer spend more than 80% of gdp on health care. that would be a mistake because we do not buy know what is coming down the pipes. it really improves the quality of our life has come along since 19 to the new ones will come along over the next few years. the question is, how do we separate the fat from the muscle? how to keep the ones doing is going to get rid of the copycat drugs, they cost a lot to develop the good. this effect in the research, competitive markets and that is why cost control is so hard. >> one of the economic arguments i've heard against the affordable care is that healthy people will simply pay the penalty until they become catastrophically ill at which point they will jump back into the system and it can't be denied coverage, which will effectively drive up costs for everyone. >> there is a balancing act with a mandate. on the one hand if you demand

that said health care insurance will kill you, that is an incredibly effective mandate, sort of self-defeating, right? on the other hand, if you're the mandate business health insurance is a good idea, that's not going to work so well. the balancing act does he pay a penalty. if the larger $700 or 2.5% of your income. if you have health insurance. so it is less than the cost of health insurance for many people. there is a balancing act here. in massachusetts it is pretty comparable and in massachusetts almost everyone complies with the mandate. the truth is americans are pretty law-abiding people. for example a massively under sheet on our taxes. relative to the amount of cheating on taxes to cheat a ton more than we do. we massively under cheat on our taxes. we are pretty law-abiding people and if we have a mandate in place with a penalty that is real, which this does, by and

large people comply. but many won't. the congressional budget office that this bill will cover 60% of the uninsured in america. unfortunately undocumented immigrants are completely left out of this bill. as a political decision made right at the start of there's nothing to be done about that. second is people exempt from the mandate because what we want to bring people in, we don't want to penalize people who can afford it. if you pay what it did during chimeric sand. the third is people who won't comply and will be millions of people who don't comply. the point is as long as you get enough people in a system that will keep costs down and that is good. the novel were. but this is going to be constantly evolving scenario. it is change a permit to the medicare program is a prescription drug act added 40 years after the program was introduced via these programs change a lot over that period of time. we are far from done with health care reform, but this is our best estimate of over to balance and having something he made double really work.

>> i actually had a question regarding the ending of reimbursement for readmissions of the hospitals. i'll start by saying i am very much -- i do support universal health care. very liberal in that aspect. but i am a cardiac nurse. and congestive heart failure is one of the top reasons for readmissions into hospitals. and knowing that that is a degenerative disease and that especially in these economic times, it is very hard to prevent readmission, just due to lack of insurance, lack of being able to afford the medications needed to control congestive heart failure and at a certain point you can't. you need to be readmitted and eventually you end up not getting out. what i have seen this bill do and that