this has more to do with -- legal standing of the lot is solid and this has more to do with politics. >> -- the legal standing of the law is solid and this has more to do with politics. >> you also have the critics on the left hand of the spectrum saying this plan is the start, but it to go further. i am wondering to what extent he would characterize this health care reform plan as a start and if there -- you would characterize this health care reform plan as a start, and if there are additional steps you would have taken? >> i think there is no question there's a wide spectrum of the beginning of the debate. certainly, there were people who felt would be advisable in the united states would be to scrap the third-party insurance system and start again, have a single payer system mirroring what a lot of other developed countries have. others who said what we really need to do is have a total market-based strategy. take the rules of insurers, get

rid of the barriers that currently prevent them from operating in a creative way, and the market strategies will really solve the situation we're in. i think the president and congress chose what is a middle ground approach, a kind of common sense approach. not dismantling the insurance rolls, but figuring out a strategy that builds on the current system, makes it stronger, and also opened up the private market, creating new marketplaces for the 30 million americans who do not have coverage currently. i am sure overtime this law will be revisited. you know, my dad was in congress in 1965 when medicare was passed. he served on the energy and

commerce committee here. medicare has changed a number of times in the 45 years since then. i would suggest we would not recognize the law. the template us saying once you reach 65 or are severely disabled in this country you should have health care is a principle that has been under constant improvement, a principal of saying all americans should have affordable, available health care is one we will continue to work on, but is a significant step from any place we have ever been before in the united states. >> what concerns be -- you have that the insurance industry will evade rather than comply through loopholes? >> i think that there is a principle that has been in

place in health insurance for number of years, which is not terribly complicated. it is a whole lot cheaper to insure people who promise not to get sick the people who do get sick. it is the same principle used in property-casualty coverage were you do not want to, and insurer homes in tornado alley like kansas. he would rather find a place where storms do not hit. -- you would rather find a place where storms do not hit. i think working with the insurers to actually look for ways we develop a new business model is going to be very important. it is going to require oversight and vigilance. it means changing the rules. it also means that insurance companies will be competing on the basis of price for new customers and have to be, i would say, not basing the

customer selection on cherry picking the market, and eliminating certain groups of individuals. insurance commissioners at ground level will have an initial responsibility for oversight consumer protection. we have urged them already. in some states there is not the full benefit of the legal authority to have rigorous we review, to have actuarial studies -- rigorous weight to review, to have actuarial studies before -- rigorous rate to review, to have actuarial studies before the rates are increased. some states have rules, in some states not all. i think it will take states stepping up, becoming more vigilant on rates in review, more vigilant on consumer protection. we will certainly be a working on a backstop to that. i think the new rules will be followed and will be vigorously enforced.

>> one member of the audience asks how does these to the direct pay program get into the health care bill? >> the history of the reconciliation bills has often included education and health care bills together. the student loan and community college reinvestment bill had been passed by the house of representatives, was being considered in the senate, and i think that members of the house and senate but that it was an opportunity really to excel rate passage of what in and of itself is an historic piece of legislation. about $68 billion over the first 10 years will be saved from eliminating the third-party loans that currently are going

to benefit students who want to attend college and reinvest those funds in doubling the programs, raising the threshold of the pell grants for the first time for the first time in 15 years, and limiting payments on loans. one of the most inspirational pieces of the puzzle is that a student will never have to -- a gradual never to pay more than 10% of his or her income in order to fully pay back the loan, encouraging people to take on jobs that may not pay as much in terms of salary, social workers, teachers. the will not be eliminated from taking on those jobs -- they will not be taken -- they will not eliminate from taking those jobs. they do not want students, graduates to continue to pay after a decade. if you provide public service for military service, you are considered to have had your debt

paid in five years, again encouraging public service. this is a major investment i would highly recommend to the press club if you have not -- talk to secretary duncan about this piece of legislation. it is a conversation worth having. >> can you help us get secretary duncan it here? >> [laughter] >> sure. >> we appreciate. can you talk about the medicaid alamance -- the medicaid areas you spoke of in your remarks? >> there is a lot of uninsured americans to fit into the jobless americans category. there are states covering a population but getting no federal assistance for that. the first step is likely to be

the state's two are currently providing -- states who are currently providing states funds for that program will be able to pull down federal assistance and expand the population. it has been a medicaid match of 60% of federal dollars, may well look get earlier expansion prior to the 2014 dublin. the opportunity to draw down federal funds for this population begins right away. >> also mentioned in your remarks -- the national high risk pool program. the health care law calls for this to be in place within three months. many questions need to be answered about how it is going to work with existing high-risk pools, states that lack them and want to develop them, states that have the plans to develop tools. for americans to have interest in reasonably-priced coverage, how soon do you realistically think it will be able to secure coverage?

>> i think we will have pulls up and running this year. in 2010. -- i think we will have schools -- pools up and running this year. states have a high risk pools that are quite expensive. even though they are tied to a market rate base, they are still expensive for individuals. i think there are only 200,000 people run the country's total that are involved in the high risk pool. we anticipate a lot of states will set up a parallel pull for this new population. the -- parallel pool for this new population. it will not be inexpensive, but it would be better than what someone with a pre-existing condition could get "on the marketplace" if they could get coverage at all.

we will have several of the regional level, one national. we will not know until we hear from states. i've written to governors and state commissioners, giving them an outline of the program and asking them to participate. we've asked them to work one-on- one with these days to figure out how to set it up, how quickly they can get them up and running. we will be the backstop for americans to do not have a pool in there and stay the one that coverage available. >> next week at the press club, we will not have arne dunkin quite yet, but we will have dennis quaid -- arne duncan quite yet, but we will have to dennis quaid. he will be talking about not reject the impact of medical errors in his life. >> i think there are lots of quality improvement measures in the new law, but the two

particular investments have a huge impact. one is the transfer from paper records to electronic records. there is no question that having the ability to pull off the record and have a provider have to answer a prescription order into an electronic record that absolutely blocks a counter indicated drug or puts a red flag of so you really cannot see -- cannot have the wrong medicine order for that patient population. in a hospital like, again, at cincinnati children's wear a visit yesterday, they have a bar coded dispensing system where you cannot release the drug from the dispensing system unless it is bar coded. the baby i was visiting, along with his mom, is four weeks old. he has a wrist band that is part

coated. the nurse indicated to me that he passed -- that she has to barcode his wrist and dispenser, or the drug is not released. that in an of itself i think is a huge step forward. many hospitals have electronic records, but not enough. as part of what is the ball. 100,000 people a year die in american hospitals, not because of what brought them to the hospital, but what happens to them in the hospital. hundreds of thousands more have very costly, very consuming injuries. it is a challenge we have taken on with the american hospital

association. there are some pretty simple checklist that have been shown to dramatically reduce hospital- associated infections. two-thirds do not require new equipment, do not require fancy training. they're just not implemented in hospital after a hospital. they are not in place in way too many of our medical care -- we currently pay the same amount for incidents whether or not something happens related to hospitals if you were not, we still are paying up until last year for so-called "never" incidents were the wrong limb is amputated. you did the same payment of the public insurance system as the best possible result. we can use, i think, the payment system to begin to drive and put in place incentives, initially

incentives to promote better care, but eventually disincentives for bad care, and i think we have to start doing that very quickly. " there is a serious shortage of gerontologist, which is a concern as the population ages. -- >> there is a serious shortage of gerontologists, which is a concern of the population ages. >> there is a shortage of primary care and family care docs coup often have that same skill. we'll begun to change the payment formula in the medicare system to more appropriately compensates medical providers to choose our range of family primary care services. we will continue to accelerate that. wheeler also part of the investment back in 2009 -- we

are also part of the investment in 2009, part of the work force recovery initiative. this helps build a more ample primary-care work force for the future. which is critically important, and providing more scholarships to providers who are working in areas where we see a growing need, and gerontology is one of them. >> what is your own view of using acupuncture, medication, and other alternative healing methods in health care coverage? >> there clearly are plans in place, and i anticipate there will be plans offered in the new exchanges which will give patients a wide variety of choices. i think that while there is likely to be a definition of what is a preventive care plan, insurers are likely to compete based on having a more wide

range of courses for consumers. there is some pretty interesting data about cost effectiveness that we will continue to monitor. i think our compared -- comparative effectiveness research will continue to look in a variety of alternatives for expensive care, whether or not interventions are more homeopathic there be is fortresses that really do lead to better health care outcomes. i think those are often wise health-care choices. >> this audience member asks for your thoughts on raising the medicare and other health care plan eligibility age gradually to 70 to keep cost down. >> one of the group's that the president -- one of the groups the president has put in place by executive order and it is

likely to be deemed in the not too distant future -- and entitlements commission. looking at the social security, medicare. i assume medicaid will be part of that. the rules of those various long- term files, the eligibility ages, the kind of benefits provided compared to the cost of the program, i think will be a topic that will be robustly debated and discussed by the entitlement commission, and i think it is very appropriate. much of our long term deficit in this country is directly related to the various entitlement programs that we have, so it is likely to be appropriate to look at everything from, you know, at age and treat to, you know, what the benefits package looks like -- age of entry. i think all of those issues will

be part of the conversation of the entitlement commission. >> part of the health care reform package is an emphasis on preventing disease and disability. such an emphasis would result not only in significant monetary savings, but greatly reduced -- taxing fattening foods and so does is it difficult politically. does hhs need to rethink its approach in light of health care reform? " there's no question there is a major emphasis in -- >> there is no question there's a major emphasis in help perform in prevention and wellness. in spite of the reluctance of the congressional budget office to score anything related to prevention and wellness, i am a believer it does not take much of a rocket scientist to understand the are spending 75 cents of every $1 on chronic

disease treatment and 8 cents of every $1 and prevention, rebalancing those numbers a little bit and getting the underlying causes for chronic disease would save money in the long run. when the reasons congress put a major first time prevention and wellness investment out the door in the recovery act was just to get at long-term health care costs and healthier americans. it is focused on two areas -- of the city and tobacco cessation. we did -- obesity and tobacco cessation. we did pretty well on tobacco. young smokers it has not gone down at all. tobacco is the number-one cause of preventable disease and death in this country. going after that again. there's a whole range of issues dealing with obesity. certainly at the state and local

level, the consideration of taxes on soft drinks, fatty foods, snack foods is one of the policy addresses the people are beginning to look at. -- policy choices that people are beginning to look at. we put six grants of the door just the last week that are going to communities across the country to look a prevention and wellness strategies and what works on the ground. we know about tobacco. we do not know a lot about obesity-related strategies that have been affected over time. there have not been a lot of tests, there has not been a lot of research. we are looking for to learn what policies really work. what works at the local level. there's a huge effort under way as part of the first lady's "let's move" campaign which has the goal of eliminating childhood of the city in a

generation -- childhood obesity in a generation. one of the strategies is looking at the new machines in schools and cafeteria choices. -- vending machines in schools and cafeteria charges. we are looking at school nutrition standards. we're looking at food labeling standards. part of the bill requires posting of calories on fast-food menus that will be available and easy to read for consumers. there is going to be a lot more information, a lot more policy effort coming from lots of different directions on trying to get to some of the underlying causes of chronic disease. >> given your years as state insurance commissioner, do ceo's of health insurance companies make too much money? >> the late -- they make a lot

more money than i do. that is a shareholder decision, i think. what is troubling is the disconnect between on one hand arguing for an enormous rate increases in what appears to be excessive salaries, overhead costs going forward. wellpoint became the prime example of this where there fourth quarter 2009 profit statement showed a $2.7 billion profit, and within 10 days they have filed up to 40% rate increases for the california market. so the ceo of a 51% salary increase. there does seem to be a disconnect.

that is why ask the top five health insurers to give us the data. let us put on the website. if the rate increases are actuarially justified by health care costs, which was the verbal exchange, give us the information. let us make it transparent and began to educate the american public what is really going on. so far we have not gotten that information, but i look forward to taking a look at it. >> when will there be a new commissioner in place for medicare and medicaid services to steer the implementation of the health care reform bill? " the president will make a decision about naming a new minister -- >> the president will make a decision about naming a new administrator. we are concerned with building a new team with the focus of a more robust role for medicare and medicaid. a key member of that team is

here. we stole her from the state of virginia. she is the principal deputy asked cms. we added tony from the state of arizona, running the health strategy systems. he will come the head of the new center for medicare. we have of -- we have an administrator focused on fraud and abuse. these are all new positions that will help us have a much more robust innovation and quality strategy, and enhanced effort on cracking down on fraud, and helping us deal with the medicare challenges the bill as presented, moving medicare to a much more value-purchasing operation with its $400 billion plus we spend every year.

we have an opportunity to change the delivery system and i think a pretty significant way to the benefit of beneficiaries in consumers across the country. >> many of the questions today are about the future of health care reform. we are always looking ahead. this is been a bruising political battle over the last several months. there was obamacare and the death panels and late-night votes and procedural controversies. "i am concerned by the widening gap between republicans and democrats made worse by the controversies over health care legislation. what are we doing to bring people together again?" >> i am concerned about it, too. i do not think it bodes well for our future when we cannot have a robust debate, but also resolution of major challenges

in some sort of a bipartisan fashion. i am disappointed that from the outset of this debate, a year ago, before i was ever even appointed secretary, there were already sort of political battle lines being drawn and people saying we will never to stay in this conversation, which i do not think is healthy going forward. -- people saying we will never purchase of a -- we have opportunity working with consumer advocates, where people understand exactly what is in the law, what is not in the law, what it does, what kind of timetable the implementation strategy is taking. there'll be a lot of engagement and enthusiasm about it. will that help our next round of debate?

i do not know. i hope so. i am a believer that finding common ground is important going forward. as the democrats elected in an overwhelmingly-republican state, i found building coalitions to be something that is critically important. we will go right back to work and try to do that. one of the things i think that got lost in the shuffle along the way, which is somewhat remarkable is that there are groups and organizations, among them the medical -- the american medical association, representing health-care providers in this country, of the web historical opposed any kind of health care reform legislation, including medicare, vigorously opposed it. and yet they were at the table with this puzzle. there were lots of business groups, some definitely opposed, but some who came to the table

in the recognition that we had a broken system and had an opportunity to make significant changes. people did not want to lose that opportunity. at the end of the day, that will be the common ground. we have not lost that opportunity. we need to bring people together. >> we are almost out of time. before i ask the last question, we have important matters to take care of. on april 12, dennis quaid will be discussing the prevention of potentially deadly medical errors. april 15, secretary to paul lozano of homeland security will be here discussing aviation security -- secretary napilitano. also like to present today speaker -- thank you for your time today. here is the legendary national press club mog.

-- mug. [applause] now for the last question -- given the debate and your position, what was the biggest challenge to staying healthy during the stressful months of health-care negotiations? >> i am our runner. i figure as long as no one is chasing me, i will continue to run. that helps us sort out my days. i go down to the mall,, a little "god bless america," and it believed the sun will come up. and sure enough, it has. i am pleased to be with you here today. thank you for inviting me. hopefully you will all visit our website, healthreform.gov. we would like to have your input on what is working or not working, what information is hard to find