health policy practices. what washington"journal," c- span. >> this weekend, conservative party david cameron on how government could change current domestic politics. a british politics, tonight on c-span. >>. .

>> this is an important question. yet it continues down this path, august will be all lost opportunity to develop a consensus that needs to be developed in the american people. and the important and crucial thing for the president and for leaders on capitol hill on both sides is to break down the components of health care reform and talk about where there is consensus. frankly, people are not getting a sense that there is consensus -- and there is on important elements that we will talk about. unfortunately all of the stories are process stories about his disagreeing with whom as opposed to where two people agree? and i hope that we will be talking about this.

we are agreeing throughout the country on about 80% of what is necessary. looking back over history, we have never come this far. this is certainly not the case for 1993 or 1994. it is the case today and it would be of lost opportunity. rather than conflict and focusing on contract, a strong commitment needs to be made to educate and help build consensus so that members get a sense of yes, we can, basically. >> and at the same time, insurance companies have been vilified in accused of stirring up some of the hostility and town halls. this year as well as 1993 and 1994. is that the case? >> that is not the case. i sent letters to the four leaders at the capitol hill. we want people to know that our members are the people who do

disease management, they are angry about what is being said about them. no. 2, we have urged them to go to town meetings, tell their story about what they are doing every day, and participate and dialogue. we are not responsible for unfortunate tactics that are going on and we have made that very clear. there have been a number of assertions out there with no evidence. we want to make sure that people hear from us directly about what we're doing and what we are not doing. we feel strongly about the issues but we also feel that there is a responsibility for supporting one way -- comporting oneself in a respectful, providing information, and shedding light on the fact that our industry strongly supports the elements that the president is talking about today, this weekend, and this week about insurance market reform. we have offered proposals and

believe in those proposals and stand behind them. >> ezra klein. >> let's talk about those reforms. the white house is messaging on them and calling it health insurance reform. they have begun to emphasize strongly policies that would curb the excesses. previous discrimination, many toward rating. you have agreed to most of these regulations. all them. aside the one notable public option. but why did this happen -- why did this have to happen in a political contest? >> this is a very important question your asking. as you know, a number of states have actually moved forward with market reforms over a period of about 10 to 12 years. we have actually done a very thorough analysis of what happened. massachusetts is a great case in point.

prior to passage of the legislation, they tried in kirk -- insurance market reforms without getting everyone in and having everyone participate. essentially the market blow up. people in the market, individuals getting insurance, ended up with rate shock because the people with the lowest risk people decided not to participate. we can talk about washington state and a number of the new england states. and massachusetts learned from its experience. that is why we focused on getting everyone in. when we saw what happened in massachusetts, we realized that we could bring reform to the political system, springing off the platform that massachusetts set -- shall i on what was possible. people in that state recognized that it was unfair to subsidize people who refuse to participate.

once that principle of giving -- getting everyone in was established, it challenged everyone. we went out on a listening tour all across the country. we presented our proposals and what we heard very clearly is that people wanted us to do more. they wanted to talk about that guarantee issue, and getting everyone in in making sure that they stayed in europe wanted to talk about portability and not a voluntary contribution or commitment to that but they wanted us to be clear and transparent that we would support legislation to deal with exactly that. that had a material impact on all of our processing and all of our discussion. at the end of this year -- last year, in september we came forth with a comprehensive program which were the building blocks with what members of congress were talking about today in the area of insurance reform. we are proud of that and we can contribute to that. we can educate the people -- the people to the important that gary >> universality is the game

changer for the insurance reform. the new can begin to restructure the market around that. until then, in the insurance market reforms will not work because sick people or the help people will not come in and there will be disruption in that program. >> this is not hot offices on our part. there's a few that has been borne out with experience in the states. we had a report not done by us, but at third party, ought to make sure it was objective. if you go round to the various states that have gone down this road without having everyone in, that was the experience found time and time again. time and time again. the other thing to talk about, particularly for viewers, we're talking about not the employer market but the individual market where people are choosing for themselves to have coverage. there are 19 million people in

that market. that is the conversation at all of these issues are about. >> said the insurance companies offer these proposals for reform. some lawmakers, senator schumer for example, said that the insurance industry's the pony up some dollars. we have seen the pharmaceuticals and the doctors and hospitals contributing x amount of money to help form efforts. was the insurance industry approached with any kind of deal from the white house or was that ever had discussed? >> i am glad you asked this question. there are three points that i want to make. number one, our board members and our community were the first to step up with saying that we were proposing comprehensive overhaul of the way the insurance market works. no industry has proposed a comprehensive overhaul on how it works. we are proud of that. we think that it is important and needs to be done and we are squarely behind it.

two, our industry was one of the first in working with consumer advocates on the concept that as a country what the president said, health care costs are crushing the american economy, that is true. we need to have cost containment and down the cost curve. we were one of the first in line in that process, and joined with a number of birds in a coalition as part of our contribution. we pledged that we would support comprehensive administrative simplification. from that time, it was in june, we were working with various committees on capitol hill and as all the bills come out, people will see that our commitment will be filled. we said it should not be a voluntary effort, it should be required. and it will be prior to proposals that will be moving forward on capitol hill. it is in the health committee draft, it is in the tri- committee drafts on the house

side, and there will be more administrative simplification savings in the finance committee proposal. we have been working hard to contribute to that, hard to identify those savings. the only disappointing thing -- and i think that this is that disappointing associated with a whole issue of cost containment -- cbo can only score what is on the budget costs. we know from a number of studies and consulting firms that what we are putting on the table will amount to hundreds of billions of dollars over 10 years in systemwide savings, streamlining everything, the way that eligibility is determined, the way they claims are queried from the decision perspective. real time couldn't -- adjudication which will not mean a lot to like folks listening to this program but will mean a lot to physicians and hospitals. those of a kind of things that we're committed to.

we have been standing behind this and that is part of what will emerge. and finally, we have been looking at ways to try to help in the transition as we move people into a system who have never been part of the system, to make sure that underlying costs do not rise for people who are already there. you'll see these particular pieces of legislation that will involve our taking responsibility to help smooth that path. we're very proud of that and we will be talking a lot about that. exar, your question as well. -- ezra, your question as well. you will see that as part of the legislation as it moves forward. >> the media is concerned with process and i want to understand a process point. given as what you describe is your feet at the table, why is

it that your industry was is -- was specifically singled out by the speaker of the house? >> i have this old fashioned a rule which has served me very well. pass it on to my family, and my son. i think one should never answer for someone answer. you should pose that question to the speaker. i hypothesize that it is consultant driven and a page of the 1990's approach to health care. but we're on a different page in our industry. we have worked hard to learn what the american people had to say, and said a strong message to us and to other business leaders this year. they said that we expect business leaders to stand up and identify solutions to problems. we cannot put our head under a blanket and decide to dodge and wait and comment and and productively comment or oppose. we went on a quest to contribute to health care reform. taken at very seriously and we have offered comprehensive proposals all the way through.

the country, and in fact -- we can incorporate are learning. we continue to talk to members of congress. why the decision was made? i think it is a distraction that unfortunately masks the fact that there is consensus in key architectural elements for health care, and getting everyone in, providing the kinds of insurance market reforms the president is talking about that we support, and that a number of republicans and democrats support, making sure that there are subsidies for working families and expanding medicaid, and we have never come this far. having the focus now being on vilification and who is saying what a town meetings, no individual or around the country is getting the message that there is strong support for reform.

that is a shame. we cannot afford that because when members of congress come back from recess, they will not have much time. they, at a mass it -- if they come back with a message that people do not support basic elements, that is a lost opportunity. >> us talk about the 1994 and the differences today. one of the reasons that the speaker and others mistrust your industry is that you are behind named harry and louise ads. yet been much more engaged in de process this time to rethink it is essential as somebody -- you have been much more engaged in the process this time. what is the meat of reform? is there any reverse harry and louise strategy? >> i appreciate his question. we made a commitment to play a productive role from the beginning of this year.

the president invited us to the health care summit and we stated very clearly that our members were committed to contributing to the process. we have held to that all the way through. as part of that technical component which we felt, identifying a way to achieve insurance market reform and cost containment, and the country has just scratch the surface of cost containment. i hope that we will talk about that. the third issue is making sure that we stand behind what we say. more than 2.5 weeks ago, toward the end of july, we put up a commercial that talked about the fact that illness has not geographic boundaries, no boundaries with respect to economic status, or race, or whatever. it affects everybody. we are committed. we know that there are important things that can be done by way of getting everyone into the

system, keeping them there, and making sure that they have a safety net. the end of the commercial indicates that we're for bipartisan reform. if taking all the work that we had done, packaging it, and putting real dollars are brown the commercial that communicates to the american people about where we are and what we support. it is taking this outside beltway, and people inside are familiar. that was what was very important to the august recess. >> one of the proposals put forth in the sense finance committee -- the senate finance committee is the calotte which is a alternative to the public option did you do not seem to want to support. is that something you can support? how would that play against private insurers? >> there is no way to know how these entities would be defined. let me give you just a broad answer, because until we see details, we cannot give a

specific answer. they will be under the auspices in some way of the government. what they are at the federal level or at the state level. government has no ability to negotiate with providers, doctors or hospitals. the only zero in the quiver is to administer pricing. we fear that all the terminology is more benign than a government-run program, the effect is pretty much the same. we have been talking about that and and very consistent about that. we don't think that the government has the ability to negotiate. we have been very clear from the beginning, very out front about our concerns about a government-run option. we're going to be similarly clear about the concerns about -- you can have been nine language but did devolves down to the same thing, then we will

have a concern -- we will have similar concerns. and now it has taken a bit, but decisions around the country -- there are a number of hospitals around the country and certainly employers, which have expressed some of the same concerns that we have been expressing about a government-run program. this is a discussion that members of congress need have and we support the fact that they need have this discussion. >> us talk about a government- one theory as well. obviously the insurance industry have been steadfastly opposed to it. we're having this discussion because the insurance industry has failed to rein in costs for the past couple of years. there been a number of practices that you agree are -- should be curbed. and at the same time, medicare has its own problems but has a higher satisfaction problem and public -- private health insurance. if it's done a better job arguably of controlling costs. why should we trust -- if you cannot compete the government

auction, that would be great. you wouldn't want all lumbering, slow government option. but there has not been a record of success here. >> i'm sorry? >> i guess the argument there is, why should people believe that they do not need this potential emergency exit from the system? >> the first thing is, a number of individuals that began several years ago to develop a government auction had no idea that our community would come forward for such aggressive regulation. had they, they might have gone a different direction. if you had regulation, of the type that we have indoors, transparent where we are accountable, why is it needed? and in terms of satisfaction, if you compare traditional medicare to medicare advantage, people over 65 to people of 65, if you

will find very similar satisfaction rates, and in some cases, higher satisfaction with medicare advantage. if you look at that types of cost containment and quality improvements, none of the elements that we have introduced with positions in a collaborative way, disease coordination, pay for quality, has been successfully introduced in medicare. gao just did a study said that imogene is rising, excess utilization, and ought to adapt a technique that the private plans have. but a number of members of congress have said, over their dead body. government has a difficult time getting to the politics. during patient protection, we brought health care costs down to zero in some cases below zero. the message we got from

politicians was that we were too aggressive in using utilization review and networks, and the kinds of things that people now seek to replicate in accountable health care organizations. so what we did was send a message that if we take out all of these tools, health care costs will soar. we were right. now we began to reintroduce the tools. if you look at their rates of increases of health care premiums, you see them coming down gradually. we've taken pharmaceutical expenditures from 15% down to four percent. that is a very significant rate. we're not taking options away but letting them learn the consequences. care coordination -- the importance of doing care coordination in medicare. i can say now that we are about

to release a study which looks at our data, government data, comparing care coordination and what we're doing to get unnecessary -- unnecessary utilization down, how we're getting emergency procedures down, and medicare manages versus fee-for-service, all because we are dealing with current heart problems, diabetes, etc. and work with physicians in a collaborative ways. government is using none of these tools. in terms of sustaining the health care system, we need to of the balance of public and private. nobody in our system would disagree with that. we're trying to get the best of both. we think that the private tools could be embedded into medicare but it will be difficult to get the politics through to do it. a lot transparency and we're only talking about the individual market.

the individual market was 17 million and may be going up to 30 million, but they will make sure that they have peace of mind. you put that all together, we think we can structure a system that is much better than the one that we have today, that is more transparent, but allows the benefit of drawing from the different areas of expertise on both sides. >> if i could follow on that quickly, medicare and fans is more expensive than traditional medicare. i agree with much of what you said, is that you cannot compete the government. the government will not be able to adapt these wonderful techniques. why is there an argument there should not be a competitive argument. >> in terms of head-to-head? >> said that i could choose a public option. >> the last point that you made was very important. that is the last thing i did not comment on. on head-to-head bases, why is

medicare cheaper? medicare is cheaper because it pays eighty-five cents on the dollar. if we continue to get ourselves that underpaying hospitals means cost containment, then that will put us on the path to ruin. that is why so many hospitals have stood up and said, if you pay as medicare rates, we're going to go bankrupt. we're going to dismantle the entire system. the question is, how do we back up and do the right thing and put together a policy that works, and frankly, can get past? there are key elements that can get past. medicare and manage, i would love to talk about that issue because nobody is talking about this. they never disaggregate where members of congress have decided to pay more in areas that have been underserved. if you disaggregate as, if you see a very different picture for medicare advantage. medpac is not disaggregate it and that is very irresponsible.

many seniors are on the verge of losing their coverage because of what is proposed in these bills and nobody is talking about that. it will be very concerned about it. >> one more thing i wanted as. you had that to implement a lot of changes. profits have gone up dramatically. why not just institute some of the regulations you were suggesting yourself, no longer denying patients, things that you have proposed? when i did that by yourself? >> i am glad you gave me a chance to talk about profits. i would be happy to provide all the data. we have compiled this over the last 10 years. on average, profits are about 3.5%. 3.5%, the press number of profits in our industry is $20 billion, and we're spending $2.40 trillion on health care. it is less than one cent of every dollar of health care

expenditures. we're the smallest sector in terms of profits compared to actions of drug companies, any kind of academic medical centers, imaging, that sort of thing. we think it is very important to have disclosure oand that requirement should apply across the board so people can get that data. so they know exactly what is going into the system and what is not. in terms of mounting an effort to do what you have said, if you don't have everyone in, as massachusetts found the first time they tried this, there is a rate shock for people to stay in the system. -- who stay in the system. >> we are out of time. thank you so much, karen ignagni. >> we're back with jennifer haberkorn and ezra klein of the

"washington times" and the "washington post," respectively. karen said that the media is still involved in process. >> i would absolutely concur with that. it has become a real problem and you see it over and over again. you have all the stories about whether it is democrats and powers are republicans, negotiating with each other and backbiting and getting angry. people tend to forget. if you in the pitch of these town halls and you think we were talking about something so massive, death penalty and euthanasia, when we're talking about fairly modest transfer of resources from the top of the system and some of the medicare to give people insurance at the bottom. but the bill would not have a much of an impact for most of us. it's not clear what is being discussed here.

>> how much responsibility to -- did the politicians have? how often did they start, here is where we agree? >> not very often very most members of congress want to ban pre-existing conditions. there are a lot of things like that where they are on the same page. but at the same day, it's easy to pass a bill that everyone in vote on but that may not have the impact that a more controversial measure that could have more of an impact, that will be more difficult to pass, something that republicans and democrats can agree would have some teeth. >> many ask you what you both think after watching a full month of town hall meetings and the president on the road in advertisements being run, all the coverage on the internet -- what will this be like in september when the members come back? >> it is hard to say.

one thing about the town halls that is consummated -- complicated is that they are doing to the wheel of things. i don't think anybody thinks that these are representative of the people that they know with the way that the majority of the country feels. they are angry and organized. the become a little bit of a tool. on the other hand, a lot people are looking at this process and saying that this is chaos. health care is delicate and it is complex and i am afraid about it. how can someone -- something really good, a process that appears to be dominated by extremes? the town hall and not very trustworthy and they're doing a good job of selling what is going on in this tempered the degree to which politicians can say, that was not real and this is, is very much yet to be seen. >> it is sent to see whether there will be a bill this year? legislation passed?