as soon as we get the wire on -- they wifes on subpoena they get a court order to go on to the gangsters cell phone. the first very first conversation they report is him talk together fbi. >> i think the state police are coming after me. >> he was right. when they took them down. the same fbi sprucesser said -- call the state cop commander and said that was a great one. want to roll them together? the state cop looked him and said roll them? put them in prison. he said what are you crazy? he's a killer. he's killed at least six people and the response was we know only one. he was the guy that killed one person is acceptable. so you ask me has it changed? i don't believe it's changed. i think fbi needs an enema. i'll go back to had.

i walked by shelly and were in washington last week. i walked by the hoover building and thought what a disgrace that the name is up there. what with know about the guy he was one of the most corrupt government officials in the history of the republican. and his name is still on the building. his etho is still in the building. that's why all we talk about whitey gull we are bsh bulger. >> on that cheery note. [laughter] i would like to thank you for coming out. i would like to thank shelley murphy, kevin. the book is whitey ♪ >> if we turn away from others, we align ourselves with those

forces which are bringing about this suffering. >> what happened to join to take advantage of it. >> obesity is nothing short of a public health crisis. >> there so much into it. >> i think they serve as a window on the past it was going on with american women. >> she becomes the chief compromise. >> many of the women who were first ladies, they were writers. a lot of them were writers, journalists. they wrote books. >> they are more interested as human beings than their husbands. if only because they're not first and foremost defined and limited by politics.

>> when you go to the white house today, it's edith roosevelt white house. >> during the statement, there was too much looking down and i think goes a little too fast. >> yes, ma'am. >> i think in every case the first lady has really done whatever bitter personnel are to enter interest. >> she made her grow in her memoir, but she said i, myself, never made any decision. i only decided what was important and when to present it to my husband. you stop and think about how much power that is, it's a lot of power. >> prior to the battle against cancer, is to fight the fear that accompanies the disease.

>> she transformed the way we look at these bugaboos, and made it possible for countless people to survive and flourish as a result. i don't know how many presidents realistically have that can have impact on the way we live our lives. >> just walking around the white house grounds, i am constantly reminded about all of the people who have lived there before, and particularly all of the women. >> first ladies, influence and image, a c-span our original series produced in cooperation with the white house historical association. season two premieres september 9, as we explore the modern era and first ladies from edith roosevelt to michelle obama. >> authors of the paper on health care policy yesterday discuss alternatives to the

affordable care act. the paper, written for the american enterprise institute, focuses on issues of universal coverage and personal choice. this is an hour and a half. >> all right. can we please come to order your. i'd like to thank everyone for coming. we are starting probably on time, not just welcome our guests and the audience but welcome our guests across the country. we are being broadcast live on c-span. i'm henry olsen, vice president at the american institute -- american enterprise institute and a very proud to be hosting and introducing this event about the new plan put forward a eight imminent health care experts, best of both worlds, universal coverage and personal choice in health care. this is important not just because this is a pathbreaking

plant in which it is but it is a number of very new element to it which i will let the authors of the plan described in more detail, that it's important because of the conversation that it's going to start. we've been wracked for over five years in this country by very loud and often times not very informative discussions over the course of health care in america. we all know what the political arguments for and against the affordable care act, known to its opponents as obamacare, r., but we very rarely have been treated to assist discussion about the underlying values that both sides feel very strongly about this debate. what this plan does is talks about how to implement the values that are often talked about by both sides, but also to be shared somewhat universally by most americans, which is covering the most number of people that we can, providing

quality care for the people that we cover, and providing cost control for the system at large, while making sure that the system also takes care of the individual needs of each individual patient. i expect that not every person will sign on board with every aspect of this plan. i don't think the authors expect that. i do expect that what we get today is a lively discussion from people focusing both on the details and on the values that are implicated and implied by this plan. and hope what this would start a discussion, because whether or not one is a supporter or an opponent of the aca, i think everyone can recognize it's not a finished work. it's not a finished work whether or not implementation rolls out successfully. in part because even if implementation rolls out completely accessible there will be some people who are not

covered and not able to gain relatively affordable access to the health care system. but also because even if i runs out, according to glenn, there are serious doubts as to whether or not the other ballots that we talk about, the cost control and quality, will be adequately contained in the plan. we will continue debate in health reform for years in this country regardless of what happens in the fall, regardless of what happens with implantation because we've not yet, we have not yet dealt with what we want from health care plan. we have three of the authors on the panel right now. with a couple more in the audience. i would like to just mention you all eight of them are, and then joe antos, our moderator, can get the program started directly. the lead author was darius lakdawalla, and he was a visiting scholar who brought the team together.

in no particular order we also have jay was in the audience. amitabh chandra was on the panel. michael from harvard who can't be with us today. dana goldman from the usc schaeffer center who also can't be with us today. anupam jena. on our panel, and the audience and thomas phillips from university of chicago who could not be with us today. please join me in welcoming our panelists, our moderator and our discussants. [applause] >> thank you very much, henry. i'm joe and those at the american enterprise institute, ma and i have the honor of introducing the panel. before i say a little something about him i wanted to quote what

i think is the single, clearest, sharpest statements about the state of health policy i've read in a long time. it's in the beginning of this report. this is the report we're talking about, best of both worlds, uniting universal coverage and personal choice in health care. this statement is, at its heart the current health policy approach first destabilize the insurance marketplace and then relies on a bright of stopgap measures to prevent its collapse. if that isn't the american way i don't know what is. in any event, it's great to have an alternative to other plants that have been floating around. it's sort of interesting can you

use the term universal coverage. that term of course has been used by another prominent health reform plan, but we know that universal dust of winning 100%. so i'm sure they'll be a question from the audience about what universal means in this case. in any event, let me introduce the panelists in the order that they will speak. so first, darius lakdawalla who is a professor of pharmaceutical economics and policy at the university of southern california, school of pharmacy. he will present the basic report and followed up by amitabh chandra, professor of public policy and director of health policy research at the harvard kennedy school of government. and then the third of the eight authors who will have a formal speaking role, anupam jena, a

physician who is an assistant professor of health care policy and medicine at harvard medical school and a physician at mass. general. power to discussants in order that they will speak, nina owcharenko who is the director at the center for health policy studies at the heritage foundation and henry aaron, who is the bruce and virginia no glory senior fellow in economic studies at the brookings institution. so thank you very much, and darius, take it away. >> thanks a lot, joe. and thanks to you and henry for your generous introductions, and also the aei for a long us to come together and tackle this important issue. from the very beginning of this enterprise we all recognize the health insurance conundrum is really about value more than it is out price and cost. even though we are simple went economists we look at as what

society values is at the heart of asia and we think americans agree on at least three kinds of value that underpin health insurance reform. and first is that, in fact, we know about one out of every six americans is uninsured. most people find a situation unacceptable and has demanded reform as a result of that. in addition most americans also think the government has a major role to play in providing health care, providing health insurance. that i think serves as our first key value that underpins what we did and underpins much of the discussion on health insurance. second of all, one of the reasons that people think government has a role to play is that many believe that society has an obligation to protect the sick and poor when it comes to health insurance and health care. we think that's also at the heart of the issue, and we share that value as well. in fact, when lyndon johnson

presided over the signing of the medicare and medicaid bill almost 40 years ago, he noted that americans have an obligation never to ignore or to spurn those who suffer. it's been a long time since lyndon johnson spoke those words, but i would suspect that many americans would continue to agree with the basic sentiment that he expressed. of course, a lot has changed in the 40 years since medicare was established. one of the things that change is health care has become a lot more propagated. if you're unlucky enough to suffer a heart attack in 1960, there was really only one thing that doctors could do for you then, was prescribed bed rest and painkillers. that treatment strategy we now know is at best ineffective and at worst harmful. fortunately we have a number of new treatments today. the difficulty comes there's an enormous amount of choice in the treatments available. today's heart attack patients have to decide what his or her

doctor do i go in for surgery? if so, isn't invasive bypass or less invasive angioplasty? do i avoid surgery instead going pharmaceutical therapy for my condition? all of these choices great complexity and our health insurance. some people are going to want health insurance that provides very focused coverage of a few conditions, or a few procedures for less money and others will want to pay more for more expansive coverage. unfortunately the current system makes it very difficult to achieve these three goals. medicare, for example, for its part has taken a really long time to bring choice into a. for instance, it took medicare about 30 years longer than to a the private insurance market place to figure out that people fight prescription drug coverage. the private insurance marketplace is not necessarily a bed of roses either.

there are a number of problems in the way the market has been structured and we create a situation that hits -- that it's private insurers against the sickest consumers. we make sure interest charge the same agreement for people who are sick and people are healthy. as a result, insurers go out of their way to figure out creative strategies for avoiding the sickest consumers who are the neatest in effect but it's almost as if we set up an airline system in which every airline had an ascent to get rid of the most frequent fliers. yep, that's the perverse structure we have and health insurance marketplace. so what then happens in the market and what are the symptoms of these problems? one is that we have a rather strange redistribution mechanism because everybody is charged the same premium come you people are healthy and core subsidizing those were affluent and sick.

so the ceo with hypertension and diabetes is receiving a payment from her healthy mailroom employees. that probably doesn't sit with most people's notions of social justice. in addition we have a situation where insurers narrow choices so that they don't end up attracting sick and needy consumers. it's again, we have airlines that don't want frequent fliers to start flying. at the same time with healthy consumers who want to avoid buying interest because they face premiums that are much higher than the true cost of coverage for them, we solved that by forcing them to buy insurance through a mcgee. we think there's a better way to provide choice and universal coverage and protect the sick. it's with the following essential element. the first is that we would provide universal coverage for all americans by providing free basic plans to everyone. those plans will be particularly

generous for the poorest and sickest americans among us. second of all we preserve choice by ensuring that every american can move into the market place and by the right policy for them and their family, by taking the subsidy for the basic plan using it to purchase a plan of their choice. third of all, we would in this perverse system in which insurers are pitted against the sickest customers by any the requirement that insurance premiums the community rated and allow insurers to price risk according to true cost. essentially what we did is we say that it's the governments job to protect, and it's our job as voters and taxpayers to protect the sick and the corporate it's not the job of private enterprise to protect the sick and the poor. it's to price risk and we will make sure the poor and sick of access through traditional welfare mechanisms. the last two points might work and what happens to people who

get sick in this system? will their premiums go up? here we think it's important to encourage long-term contracts that move beyond the weight insurance is traditionally structured today, particularly imagine you'd go to a private insurer and sign a contract saying i would like to buy a policy that provides me a guaranteed premium for as long as i'm with you, and you agree not to raise it if i get sick. those policies exist in the small individual private market place, but they need further nurturing and establishment. the last point i will make is that we believe that the excessive incentives that we provide employers to provide insurance to their workers make for an unfair playing field, and i'm level playing field. that is to say, we end up with a system where too much coverage is provided through employers because they're such a massive tax advantage, and as result of the system in which poor workers

end up subsidizing high tax bracket richer workers who value these subsidies much more strongly. of course, a lot of the work we did lies beneath the surface, so what i would like to do next is pass the baton to my colleague, amitabh chandra, to talk in more detail about each of the elements of our plan. >> thank you, darius. it's great to be back at aei. i'm going to color in some details around the vision for new insurance system. so let's walk through this vision piece by piece. the first thing we want to do is provide universal coverage and we want to do this for two reasons. the first is it accords the first is intercourse with her the first is it accords with our values. it accords with our notion of social justice. you think that insurance is extremely valuable. to those who don't have it. and it's also virtually impossible to do a whole lot about cost control when you don't have universal coverage. so the first thing that we did

is to provide free basic coverage to all u.s. residents. so this goes beyond the aca. we don't plan to ensure only 30 million people. we plan to address something like 50 million people, and the basic plan is a plan that is available to everybody, regardless of how sick they are or how rich they are. and then we will determine what goes into the basic plan using sort of a conversation between politicians are economist. we have this idea that everyone receives. from that what we want to add is we want to encourage choice in health insurance. so in today's world if i'm an employer or a fine a receiver of health insurance base, both the ceo and her executive assistant receives the same health insurance offerings which makes

little sense to us because the ceo and her executive assistant probably have very different incomes. they probably tried very different card but they live in very different sized house of but it makes very little sense for them to be receiving the exact same health insurance offering. so we certainly constrain choice in the marketplace as a result of tying health insurance to employment. we do the same thing for those people that we ensure that the medicaid program. medicaid may be infallible -- may be valuable but the network is small and shrinking quickly. medicaid patients are not allowed to come on and say, i'm going to accept, i want something more generous than the medicaid program that ending offered by the state and willing to supplement it with my own dollars. so what we want to do is increase the amount of choice that patience and workers have in the marketplace. how are we going to do that? what we're going to do is provide premium supports.

so what we'll do is we'll offer premium support to americans, and to the 50 million, for the purchase of any chosen plan. you get a premium support and you can supplement and that premium support with your own dollars if you want a more generous plan than a plan that is being subsidized by the premium support. the third piece of our plan, which is probably the most innovative is the elimination of community rating. community rating is very popular with people because what it does is it says, gee, we're going to combine the risks of the rich, going to combine the premiums of the healthy and the poor. the healthy and the sick. the problem with combining green and for the healthy and the sick, we don't want sector people to pay higher premiums is that we are not drawing a distinction between the rich you are healthy and the poor who were healthy. we are basically saying the

healthy pay the same premiums as the sick which affected the results in a big subsidy from the poor who are actually healthy, to the sick people who are actually rich. so the elimination of community rating is an important innovation in this plan. because what we do is we say, as an insurer, you are allowed to look at the person in front of you, evaluate their sickness, and offer a quote to ensure them. since that go depends on how risky or how sick that vision is, the insurer has no incentive to essentially avoid sick patients. because for sick patients, the insurer can charge a higher premium. similarly, if i may healthier patient and i get rid of community rating, i no longer have a need to no longer purchase health insurance. the whole reason we have the individual mandate in the affordable care act is because of community rating. we need the individual mandate in the affordable care act

because we're basically trying to increase transfers from healthy people to sick people. at the healthy people are essentially paying and actuarially unfair premium, which is why they will not want to purchase health insurance, which is one of to come along and say, you have to purchase health insurance through the individual mandate. if we can get rid of community rating, what we essentia essenty allow insurers to do is a healthy to -- is to succumb healthy people -- that premium maybe hyping for a lot of people but what our plan essentially does is to say if you are a poor, sick person from your plan is completely free and you are allowed to supplement that plan with dollars from outside. the fourth thing we will do is encourage long-term insurance. there's a number of reasons, but the reason is really that if we think about what we need to do to bend the cost curve and we think about the challenge of diabetes and obesity, it's very difficult to reduce diabetes and

obesity with these year-to-year insurance contract. we essentially want and ensure to come to me and say, turmoil, i'm going to be responsible not only if you fall sick next year, but i'm going to be responsible for you five years from now, 10 years from now, and someone. because it's only then that the inshore really starts to engage in prevention. so defensive long-term insurance contracts is both that we start to think about prevention more strictly than we have, but also because it protects patients from premium increases. in today's current marketplace if i'm purchasing health insurance on the individual marketplace and i come down with cancer, the insurer will take care of me for you but in the second give them come back and say, gee, amitabh, you're diagnosed with cancer, your new premium will be $50,000 a year. that is basically prevent health care for one day. so long for long-term insurance contracts allows us to focus both on prevention and it deals

with this problem that we're not going to allow premium increases to increase when patients fall sick. the fifth piece of our plan is to end subsidies for employer provided health insurance. this is an idea that has a lot of import on both sides of the political aisle, and the ac a certain to take some steps in terms of ending the subsidies. the subsidies have a bright a perverse incentive. they are completely regressive. the benefit of this subsidy a cruise much more to people or in high marginal tax brackets than the people in low marginal tax brackets. but there are other consequences of the subsidy on american labor market. many americans were essentially locked into their job. they don't search for outside opportunities. they don't become entrepreneurs it in part because they're receiving health insurance from their employer. employers are focused on what they're good at doing best, developing new ideas which are innovative, and we should completely sort of get them out

of the business of offering health insurance to their employees. so that's the fifth part. and then finally, in terms of transitioning over, the big question that is on your mind is, this all sounds fantastic. we understand sort of the broad contours of the plan but what will it cost? we believe it costs a lot less in the aca and it costs less for two reasons. the first is we're getting rid of the subsidy associate with employer provided health insurance. so that somewhere between, at least something like $300 billion a year. we are replacing medicaid with premium support. so that saves us a lot of money. the third source of savings is we actually turbocharged exchanges, because now a lot of people are buying health insurance on the exchanges. and much like what we saw with the medicare part d experience, competition, price competition between insurers for patient

dollars could end up being a big source of savings as well. with that, i'm going to turn over to anupam jena who will give you even more details, sort of drill down even further on what the specifics of our plan are. >> thank you, amitabh. i want to spend the next few minutes just working through some of the nuts and bolts about how the proposal could be implement it. and i will start by saying the numbers involved, it is joe mentioned, i'm a physician so inherently i am afraid of numbers but i will do my best for you. so first of all, how do we think about starting to develop a basic health plan? the basic health plan should meet a few criteria. first of all it should have through premiums. no premiums at all. the second page of the basic health plan should be that it is more generous for those forsake, and for those who are poor. those who are wealthy would have more of a catastrophic like coverage through the basic health plan.

the third each of the basic health plan is that it is intrinsically tied to how much we want the federal government to spend on health care. if we want to have a basic health plan that provides complete coverage for every single american, then clearly that health plan is going to cost a lot of money. and so the financing of the basic health plan, particularly the design will be tied to how much we want to spend. in this particular proposal we have tied the design of the basic health plan so that the spending a summer to what will happen under the aca. but i want to be clear that we could change that spending level to the status quo, we could make a 10% less to the status quo. that may be too generous, but the bottom line is that we could change the spending and design the basic plan in any way that we want. the basic feature still holds. as amitabh said, the idea behind the basic point is to take each individual, identify what