we've got to stop clinging to a broken system that doesn't work, and we've got to have the courage to reach out for a future that is going to be better for our children and our grandchildren. i believe we can accomplish it this year. but in order to make it happen, i'm going to need ordinary americans to stand up and say, now's the time. you are what is going to drive this process forward. because if congress thinks that the american people don't want to see change, frankly, the lobbyists and the special interests will end up winning the day. but when the american people decides something needs to he happen, nothing can stop us. so i hope you will join me. thank you very much, everybody. [applause] thank you. all right. if i am not mistaken, the way

this is going to work, valerie, you are the traffic cop? >> thank you very much, mr. president. in my opening remarks, mr. president, i mentioned when you released your youtube video over the weekend, we received literally hundreds of video questions from all across the country. your staff looked through all those questions and have selected a cross section that represents a broad cross section of the kinds of questions that came up. i want to emphasize that the president has nonseen the questions a-- ahead of time, absolutely not. we are going to begin with a video questions, mr. president if you will look he at the screen. >> all right. >> hi. my name is steve white. i am in spring valley, new york, and my question to the president is why are we consider a health care plan which maintains the private insurance companies with their high overhead costs instead of a single payer plan which would eliminate the high overhead cost, saving the american taxpayer hundreds of billions

of dollars while covering everyone in our country? thank you? >> that is a terrific question. i'm not sure if everybody could hear it, but the gist of the question is why have we not been looking at a single payer plan as the way to go? as many of you know, in many countries, most industrialized advanced countries, they have some version of what is called a single payer plan. what that means is essentially that the government is the sure remember. -- insurer. the government may not necessarily hire the doctors or hospitals, a lot of those may still be privately operated, but the government is the insurer for everybody. and medicare is actually a single payer plan that we have in place, but we only have it in place for our older

americans. in a lot of those countries, a single payer plan works pretty well, and you eliminate, as scott i think it was said -- you eliminate private insurers, you don't have the administrative costs, the bureaucracy and so forth. here is the problem. the way our health care system evolved in the united states, it evolved based on employers providing health insurance to their employees through private insurers. that is still the way the vast majority of you get your insurance. and for us to transition completely from an employer-based system of private insurance to a single payer system could be hugely disruptive. and my attitude has been that we should be able to find a way to create a uniquely american

solution to this problem that controls costs but preserves the innovation that is introduced in part with a free market system. i think that we can regulate the insurance companies effectively, make sure that they are not playing games with people because of preexisting conditions, that they are not charging wildly different rates to people based on where they live or what their age is, that they are not dropping people for coverage unnecessarily, that we have a public option that is available to provide competition and choice to the american people, and to keep the insurers honest, and that we can provide a system in which we are, over the long term, driving down administrative costs and making sure the people are getting the best possible caras a lower price. i recognize there are a lot of people who are passionate. they look at france or some of

these other systems, and they say well, why can't we just do that? well, the answer is that this is one-sixth of our economy, and we are not going to suddenly upend the system. we are going to fix what is broke about the system. that is what congress is committed to doing, and i am committed to working with them to make it happen. >> now how about a question from the audience? a show of hands? >> what i always do here is i go girl-boy-girl-boy so i don't get into trouble. this young lady here. somebody was pointing at you. do we have a microphone for folks in the audience so that everybody can hear the question? i think there is somebody coming from this direction. you can just hand her the mike. >> good afternoon, mr. president. i will try not to cry. [laughter] >> i am trying to figure out

what i can do currently. my situation is i had renal cell carcinoma in 198. my dad was dying at the time. i could not be tied up having my kidney removed. they did procedures to kill the tumor then. i had insurance and everything was paid for. but basically because of the damage the radiation did, i am no longer able to work respect, and i have no health insurance. now i have a new tumor, and i have no way to pay for it. the doctors will not see you without paying $100 or $150 to come into their office. i can get checked into a hospital under the indigent program and run tests, and then they release me. but that costs. social security will not give me disability because renal failure is no longer qualifying under social security. i cannot get medicare through

the state of virginia because you have to be considered disabled through social security to qualify for medicaid in virginia. i get food stamps, but that's it. i'm just trying to figure out how i am going to make it nine years until i am qualified for social security, now that i have a new tumor and no way to treat it. >> come on over here. first of all, we are going to find out -- we will get your information, and we will see what we can do to help you. i don't want you to feel like you are alone out there. [applause] without knowing all the tails, i am not going to give you an answer right now about exactly how we can help. we are going to find out what we can do within existing law. what was your name again? >> my name is debbie.

>> debbie is a perfect example of somebody who, in a country this wealthy, be able to provide coverage for her health care problems. what we don't want is a situation where debbie gets worse and worse because she is not getting treatment and then ends up having to go to the emergency room. as i said before, all of you will pay for it anyway. it is just that you will pay for it in terms of a hidden subsidy, and she is not getting the best care, and we are actually paying more than we would have if debbie right now was getting treated on a regular basis by a physician who knew her history. debbie, you are example a, and we appreciate you sharing your story. we are going to try to find ways to help you immediately. but the long term problem here

is going to be how do we create a system in which debbie is getting the preventive care that she needs and is able to get regular check ups, is able to get treatment in a way that is much more cost efficient than the one we've got right now, and i'm going to make a commitment that we are going to get that done this year. all right? [applause] >> anybody who needs medical treatment can get free treatment for the 24th, 25th and 26th of july. >> we will help advertise that. >> if you would like to showcase why there is a need. i think it is 7,000 people get treatment there every day of those days that it is free. >> which is a wonderful

program. but i think as senator warner and governor kaine would agree, we can't have a system that is relying on three days of free care and 362 days in which people don't have health care. that doesn't make any sense. debbie, thank you for sharing your story. we appreciate you. thank you. [applause] >> thank you, debbie. so many of the questions that are put to you on the video, mr. president, are also very personal. now we are going to take another from the video. >> my mommy and daddy have small businesses, and we need health care. >> i actually have to work for a company so that we can get coverage because my daughter is an automatic i decline, and we are too small of a business to be able to absorb the cost. how can health care reform help us? [laughter]

>> as somebody with two daughters, i am a sucker for anybody who uses their daughter in a video. my staff probably knew that. they figured well, he is going to be a soft touch after that one. small business owners are those who are being in some cases hardest hit by the rising cost of health care. and in some cases, they just can't afford to prifed health insurance to their employees, and that is frustrating, but they are operating too small a margin, or they don't have enough employees, and so they don't have enough leverage to negotiate with insurance companies. so the offers companies give them for the cost of coverage per person end up being way higher than they would be for big companies that have more consumer power. in some cases, small businesses can't even afford to provide health insurance for them,

small business owners. a huge percentage of small businesses are sole proprietaryships, maybe they have one or two people working for them. so they are like consultants or self-employed individuals. they just can't get a good deal. this is an example of where this health care exchange could be so helpful. part of what we want to do is to allow small businesses as well as people who are self employed, individuals whose companies don't provide coverage, to come to this exchange, take a look at a menu of plans that are available, join one of those plans. you may qualify for a subsidy from the federal government, and you then become part of a big pool that gives you some leverage over the drug companies and the insurance companies to drive down costs. and that's part of the way that

health care reform can provide direct savings to american families right now, by giving them more leverage. i am very pleased that the drug companies decided to cough up $80 billion to help close this dougnut hole. i have to be honest with you though. were it not for the prospect of serious health care reform, i don't think they would have given up that money. that is just my guess. [applause] and so these same principles play when it comes to setting up this health care exchange. if we do it effectsively, then not only will families be able to make some very clear choices, and small business owners make some clear choices about here's the best plan available for us that fits our particular needs, but they are also going to be part of a broader group that can apply some leverage in the system. that is essentially what federal health care employees

do. mark warner has a plan that all members of congress and federal employees have, and it is not cadillac care, but it is good, solid, decent care with a range of options. part of the reason that it is a good program is because there are so many federal employees. well, we should provide that same kind of leverage for the small business owner who right now is too small on their own to be able to get the best possible deal on the insurance market, and that's what we want to provide in this health care reform package. good. >> i think we are ready to go back to the audience. >> it's the guys' turn now. ladies, keep your hands down. this young man right here. if we can get a mike. >> i have been hearing a lot did not -- >> what is your name? >> jason. >> what do do you?

>> i work for a group called health care for america now. >> i think he knows something about health care. >> obviously i read the news a lot, and i have been hearing a lot about the price tag of health reform and how people are very concerned that it is going to cost $1 trillion. i am most concerned about making it affordable. folks like me, the american people. like you said, you are committed to make this deficit-neutral. i hope you can talk a little bit about affordability and what your plans are for that? >> good. the first thing i think is very important 230 people to do -- for people to do is to understand it is cost of doing nothing. because sometimes opponents of health care reform pretend as if we've got this great thing going here, and the obama administration wants to completely upend it just because i don't have enough to

do. [laughter] i keep on trying to explain to people look, i've got a war in afghanistan, we haven't gotten the troops out of iraq yet. i've got north korea, and iran, and h1n1 flu. so if the health care system was really working well, i would be happy to leave it alone. so understand where we are at. if we don't do anything, the costs are going to keep on rising. some employers see their costs going up eight, nine, 10% a year. as i said, families have seen their health care costs double over the last nine years. so you just project out nine years from now. your wages or incomes aren't going up that fast, which means that a bigger bite is being taken out of your paycheck even if you've got health insurance.

more and employers are saying in this very competitive atmosphere, we can't afford to do more. so what has happened if you have health insurance? your employer has done what? they have increased duckett ibblets -- duckettibles, they have increased premiums. your out of pinkosky cost has gone up 62, and they are going to keep on rising. and it is costs of medicare and medicaid are going to rise, and so our deficit will be completely out of control. don't let people fool you with this notion that somehow the reason for our deficit has to do with, for example, the recovery act. the recovery act was designed to make sure that local school districts didn't lay off teachers, and firefighters, and police officers, and it has done its job. and it is building the kind of infrastructure that we need to be competitive in the future. but it is a tiny fraction of

our long-term deficit projections. almost all of the long-term deficit projections come from increases in medicare and medicaid. so, the reason i say all this is because the costs are going to be there if we don't do anything. the testify sit will grow if we don't do anything. our debt will grow if we don't do anything. what i'm eyeing to do is figure out how do we bend the curve of costs so that we are getting more and more efficient care, higher equal care, at less cost per person. how do we eliminate the $1,000 per family that is coming out of your pockets in subsidized care, uncompensated care at hospitals that is going on right now? and if we can do that, then a, we can cover more people with the savings,. and b, we have more leverage over the insurance companies and the drug companies so that they give a better deal. that is what we are trying to

do. now, i don't think that we can't add to the deficit. we should find ways to honestly pay for whatever reforms we are proposing. i already gave you an indication of how we would do it. about 2/3 of it would come from reallocating money that is currently in the system. taxpayers, you are already paying for it. this isn't pneumonia coming out of your pocket. this is money right now being spent by the federal government, but not spent wisely in a way that makes you helter. that is 2/3 of it. one third of it, because we have to make some initial investment up front, and a lot of the savings aren't scoreable, we are going to have to raise some additional ref too new to provide insurance to families that are starting to struggle right now. think the best way for us to pay for it is capping the

itemized deductions that people making over $250,000 a year, people like myself -- used to be valerie was making that, but now she is working for it is federal government, so she wouldn't be affected by this. [laughter] capping those itemized deductions, and we can raise enough money to may for a good high quality health care reform proposal that will provide health care security for everybody. as i said before, many of you may be satisfied with your health care now. what you've got to do is project, if current trends continue, are you still going to be happy with your health care five years from now? will you have health care five years from now? a lot of people here, if you change jobs right now, but you've got a preexisting condition, and just about anything these days can be called a preexisting condition. you may have trouble signing up for health care the next time around just because you changed

a job. set aside the situation where you lose a job. one of the things that we did in the recovery act was to help people with cobra. everybody knows what cobra is. that is a program that allows you to get health insurance. the problem is premiums are so high that most people when you lose your job, you could afford it. the last thing you can do is afford suddenly $1,000 or $1,500 in premiums. what we do was subsidize people being able to keep their health insurance longer, cutting those cobra costs. i think that was the right thing to do. but we can't just do that indefinitely. we can't do patchwork piecemeal fixes through the recovery acts. what we need are permanent solutions that insure that when you lose your job or change

jobs, you still have health care. every nation on earth that is as wealthy as us is able to do that. and they don't do it perfectly. that is why i say we have to find a uniquely american solution. but don't tell me that we can't get this done. for those who say you know what, this is something that is very complicated, and so we shouldn't rush into it, that is what happens in congress all the time. they have hearings. they write white papers. and then suddenly the lobbyists and it is special interests start going at it. and next thing you know, another 10 years have gone by, and we still haven't done anything. that is not what is going to happen this time. i am going to keep on pressing until we get it done this year. [applause] >> all right, mr. president. he slipped me a note and he said right now on facebook and

twitter a lot of people are talking about the proposal to tax health care benefits. for example, rob on twitter says does it really make sense, brpt, to tax me on my health care coverage? >> let me describe for you how this argument has evolved. and where i have stood on it in the past and what is being debated in congress. part of the reason that employers provide health care so most americans is because they get a big tax exclusion. they don't pay taxes on -- and you don't pay taxes -- on the health care benefits that you receive. so it is a huge subsidy provided through the tax code for employers to provide you coverage. now, up until let's say a

generation ago, this worked reasonably well. it is starting to break down because even with the tax exclusion, the cost for employers just out of pocket paying the insurers is getting more and more expensive. some people have said that what we should do is just eliminate this tax exclusion so that the federal government isn't indirectly subsidizing employers providing care, and that we could take that money and then just give everybody a tax break individually, and then they could go out and shop for their own health care. this was essentially john mccain's proposal during it is campaign. i want to be fair to it. the idea was you eliminate the exclusion, the buildings of dollars -- the billions of dollars that come back to the treasury are given back to each person in the fortunately of a $5,000 or $7,000 tax credit,

and you buy your own insurance. the thinking is each of you are going to be discriminating consumers, and you will get the west deal or overusing the system. you won't be going to doctors unnecessarily or taking drugs you don't need. you will be engaging in self- rationing. this is really the concept behind this idea. the other notion is that if you don't have your health care tied to employers, then you are not going to be as worried about losing your health insurance if you lose your job because the money follows you as opposed to your employer. that is the concept. i opposed this during the campaign, and i opposed it for a couple of reasons. number one, if you completely eliminated the exclusion, there is no doubt that what would happen is that a lots of employers would stop providing health care. so a lot of people who

currently get health care through their employer wouldn't be able to get it. the second thing, remember when i told you earlier about how if you are on your own shopping for health care, you've got no leverage with the insurance company. well, the problem is that if suddenly now you get a tax credit for $5,000 or $7,000, and you try to go buy some health insurance for your family, and it costs $14,000, you are a lot worse off than you would have been. you're out of luck. and you've got no leverage. they have got no incentive to give you a lower price because you're on your own. the other problem is that when you're not part of a pool, the insurance companies have every incentive to make sure that if you are older or you are sicker, that they do not cover you. they want to cover the young healthy folks like mark warner. [laughter] that is who they want.

but if you are older or sicker, you are more likely to be excluded from coverage, or they really jack um the rates. when you're part of a pool, then the surers say well, i guess we are -- insurers say we'll take the older sicker folks because we are getting it is younger folks at the same time. that is one of the prones i opposed the proposals because it would be taxing the health care benefits provided by employers. now, nobody at this point -- or not many folks are talking about taxing benefits or completely eliminating the exclusion. what they are calling for now in congress is to cap the exclusion so that people who have very high-priced health care, at a certain point, they could only get a deduction up to a certain point. let's say that the average health care cost per family, a

good health care plan costs $13,000. what they would say is the employer and the employee get an exclusion up to $13,000. but if you get some cadillac plan that costs $17,000, then what we are going to do is you're going to have to pay taxes on that last $4,000. the idea that is being debated in congress rights now is, is that a good way to insure people dope have these big cadillac plans, but instead have more sensible plans. and by the way, that also raises some money. this has been offered as an also tiff way to pay for that extra one third of health care that we are not able to pay for through simply reallocating money. i think the better way to do it remains the proposal i had to cap itemized deductions. i think that is a way that we can insure that people who currently have health care represent suddenly seeing costs

to go up to pay for other people's cost going down. but instead, everybody's cost can go down effectively. but this is something that is going to be debated in the house and the senate. mark warner is going to have to weigh in on it. we are all going to have to weigh in on it. my bottom line, though, is that if you have got health insurance right now, you shouldn't suddenly see your costs go up as part of health care reform. ok? good. >> mr. president, i think we are teed up for another video question. >> mr. president, as a physician, i know the cost of defensive medicine drives costs upward. at your health care forum, you said you wanted to find out what works. in my home state of texas, i know what works. unfortunately when you recently told the a.m.a. you were opposed to capping noneconomic damages, even though a state like mine has proven that it does work. will you