where is it going to come from, especially without a price on carbon that would give money for this kind of investment. him, how doar from we move forward? ?ow do we in brace oil how do we embrace what we have in this country in a future where carbon is going to be constrained? >> is there money coming from this congress? >> there is no money whatsoever, and i think it is interesting. questionnswered your about carbon capture technology, what he focused on is the existing technology of buying the carbon, part of extracting oil. that has already been done. is necessary, and what the administration has acknowledged, the way for this program to work

is by having carbon capture and sequestration at these new plants. ofis going to cost a lot money and require a lot of research. the secretary really did not address that. he talked about technology that is already out there. we saw on friday morning, international scientific community. about, you know, how that technology is going to be developed. >> and where is congress on this? >> i mean, one thing, and the secretary talked about this, he said the energy department is central to the presidents climate agenda, as is the environmental protection agency. really, if they are going to get anything done, it is clear they need these agencies to get it all done, because nothing is happening. congress is not going to do money onto spend more

new clean tech research. the secretary answered the question, talked a little bit about the question. $30 billion from the stimulus. that money has been spent. that research has been done. there is nothing else coming where that came from, so it is not clear how they are going to make those breakthroughs. >> going after these budgets. them out at their knees, basically. a week or so.en rumblingslready heard to actually block that. be successful, they do not have the votes. but, you are going to see politics at work here on this, and it is going to go right to

the money. almost out of time. on the pipeline, what is your source saying about when the it ministration makes a decision? >> ultimately, that decision is made by the state department. it will be the state department, secretary kerry who makes the recommendation. it will be the president who makes the call. if the final analysis shows keystone contributes to climate change, the president will say no. if they say it does not make a big contribution, he will likely go ahead and approve it. i can see it being pushed into next year at this point. >> thank you very much for being on newsmakers. appreciate your time. [captions copyright national cable satellite corp. 2013] [captioning performed by national captioning institute] washingtonext

journal, we will discuss the likelihood of a government shutdown and the ring seamanship in washington, with the american enterprise institute. after that, we will continue our series on the health care law as the health care exchanges are set to open for enrollment tuesday. then, a discussion with bloomberg businessweek reporter ther, with what consequences might be. all of those pleasure calls coming e-mails, and tweets, live on washington journal, beginning at 7:00 a.m. eastern on c-span. >> next, former vermont governor howard dean. he talks about the impact of the federal health care law and the future of the health care industry. about 1.5 hours.

[applause] >> thank you for the kind introduction. i am going to make one correction. you, it ise it to their fault, not yours. i am not the second longest- state'sgovernor in the history. i am the longest-serving governor in the states's istory, and the reason i am because i love to bring up this fact, and i particularly like to bring this up. we were not admitted to the union until 1791, and since new hampshire is half of us, we were very enterprising. we were in new hampshire for two years. the other half, we claimed we were in the republic.

from 1777 until 1791. i spent a little less than 12 years as governor. the reason i am the longest- serving in the state is the 17 one-year terms, but some of those years were when vermont was a state, so i am the longest governor in the history of the state of vermont. [applause] so eat your heart out, sam houston, in texas. that is all i can say. had drived that texas ways that were longer than our interstate, and he got a big laugh until i turned around and said, yes, texas has 22% of their children with no health insurance, and we have about 4%, and that went over really big.

about healthalking insurance in texas. first, i want to talk a little bit about the economics of health care because the assumptions that are made about the economics of health care basically all wrong, and particularly on the republican side. they simply have no idea how it works, and they keep talking about market-based reforms. the problem with market-based reforms is that in health care, a petition drives prices up, not down, and the entire reimbursement system and the entire incentive system, unlike everything else drives us to spend as much as we possibly can. not drive prices down, which explains why someone like paul ryan, his plan is so unpopular. and what he suggested we do to toe the government budget is transfer the risk from the patient, and if

they can be empowered to buy health insurance, they will make smart decisions, i am sorry. to buy health care, they will make smart decisions. fsa is?rybody know what it is not a terrible idea. your employer instead of giving you health insurance gives you $500, let's say. if you do not use it by the end of the year, you cannot take it, so there is an incentive for you not to spend too much money. the problem is, it works really well if you're trying to decide if you are going to stay home a couple of extra days before you run off to the doctor. that is great. is not in hundred

dollar office calls. it is in bypass grafts and cancer. if you want to go and buy a car, maybe you do not own a car, so you're going to go to the ford dealer. are a lot of gizmos that you want, and you just cannot afford it, so you'd downsize, and you go to a smaller car, a smaller model. and you decide, well, i really do not know if i can't afford to do that, so you go next door to kia dealer, and you decide, well, i cannot afford to buy a car this year. people making rational decisions about economics. in health care, it does not work that way. you doare really sick, not argue with the doctor about

whether you need something or not. i practiced for 10 years. not one time did i have a guy get up off of the table in my examining room and say, doc, the guy down the street does it $2000 cheaper. i will see you later. it does not work that way. it is not about patients not knowing anything. the worst patients there are. nurses are the second worse. the more you know, the less rational you are. because it is not like buying a ford. the first thing is if you cannot buy a card, you ride the bus. if you make a mistake while buying something in health care, you may not come out of the office conscious or at all. so people do not think the way they do when they buy health care the same way they do when they buy a ford. for example, when i was a second-year resident, i was in

charge of the coronary care unit guyy rotation, and one comes in, and the chairman of has ardiac department massive heart attack, and he is now my patient, and i am a second-year resident, and i am paranoid. haveose days, we did not the drugs. i know people think drugs are very expensive, but they actually drive costs down. were in there for 14 days, and now, you get drugs, and you can go home, but in those days, you did not have all of that stuff, and when somebody came in with a really big heart attack, and this guy had a big heart attack, you gave them hopedves and fluids and for the best, and that is what you did. right, and thel

next day, checking the rounds, he has had a good night. and we are still nervous because he is not done yet. about 50 yards down the hall is a step down unit, which is where you go when you go home. you move down and get to a place where you are stronger and stronger, and finally, you get so a lady about to go home has a cardiac arrest. everybody runs, like you see on the television shows, and people are squeezing fluids, and mouth- to-mouth, and it is chaos, right? that is always what happens. so we are trying to run this thing and get a pulse back and everything, and who should appear at the door then the chairman of the department who has pulled out all of his tubes. his rationale is who better to run the code 99 than the chairman of the cardiac surgery department? and sits himself down

there in the room trying to tell us what to do. terrible patience. we are not rational creatures,, and we are terrible consumers of health care, even though we know more than most people who know about health care. so why do i care? most of the health care plans are built on, and most of the so-called reforms that you have heard about, they are all about the same model that you use when you buy a car. i do not take into effect the extraordinary differences when you are the consumer of the most expensive health care in the world. if there is a financial incentive not to go, i do not

think that is bad. if you are older and have diseases, that is not bad, but all of the stuff that was being suggested in washington assume that we work in the same free model economics that every other market operates on. it is not true, so i start with that because i want you to understand that in the context of everything we are about to say from here on. it is not true. we do buy health insurance well. make rational decisions. we are usually not sick about what our individual budgets are, is, our tolerance for risk and we can make smart decisions. we are not usually making it when we have some terrible problem when we are emotionally tied up, but we do not make good market-based decisions when we are in that, and that is where

you really, really expensive health care happens. that is when hospitalization happens. what we talked about before, big operations. that we do not do a good job consuming. it is not because not everybody has an m.d., because we just showed you anecdotally that when you have an m.d., you can be worse, and you are not likely to subject yourself to the risk- reward decisions you make when you are buying a car. it is a different thing. so i want you to keep that in mind. it or wroteoted for it had any idea we were going to have any kind of effect, but i think there is a possibility that obama care, although nobody had an idea. romney, the presage to obamacare.

it is true that the heritage foundation design the basis of obamacare, and it is true that they were conservative but not they, and it is true that heritage foundation design the care, anditt romney's the same consultants from m.i.t. and elsewhere from massachusetts care in together romney massachusetts and made it work were also very much involved in putting together a obamacare. out, ite going to find may end up being a different kind of free-market solution, and this is a private sector solution. no matter what your position is, and mine was not this bill. i did not support this bill in the past. in fact, i wanted the senate to vote it down so we could start

all over again. we came within one vote of the public option. realized the progressives liked it, had to be against it and killed it, one vote. reading about was what was going on, and it was one vote for the public option. that would have changed everything. but the decision that was made three years ago or 2.5 years ago when this was passed was that we soul --ve universal health insurance in this country or close to it. we are going to reform health care. sector,s have a private and the dutch have a universal system. there had to be a lot of regulation, but it can work. we passed that debate. we can have that discussion some other time, but we passed that,

and what should we do? things in the bill that nobody anticipated. number one, i think they did anticipate it, but they did not want to expose it until the kinsey did. i am going to try not to use tool much jargon, because i know what that is like, and it is daunting. and accountable care aco does,on, what an and accountable care organization, and the state laws are different, with california having to do it a little differently, and things like have in one company, you the same person who operates on your heart and cuts your grandmother's toenails in the nursing home. everyone working for one big contractual organization. why did they put that in the bill?

they wanted electronic medical records. you would not find somebody who went to dr. a over here for one other doctors, and there was no way for them to talk to each other or to keep track of what was going on. these vertically integrated companies, and they would have electronic medical records, so if the person does cut your grandmother's toenail in the nursing home and makes e, thee, -- nicks her to other doctor can go and say that this is the kind of infection that should not be treated with antibiotics. that is what they were trying to do. the universality of information, designed to have the maximum information about the patient so you can treat the whole patient. well, here are the unforeseen consequences. o, and you canac

offer every kind of care inside a single organization, you do not need an insurance company, and you do not have to charge people fee for service either. the reason the costs go up so much in our system of health care and have for 30 or 40 years and still are today, and all of the remark people are pleased the budget went up three percent 1.1 isflation last year, still three times the rate of inflation, i grant you that three percent looks a lot better than nine percent when i was governor, but things were different. the reason it does is because we get paid to do as much stuff as we possibly can to you whether it works or not, and if it does not work, we do more and get paid for that, also. fee for service drives costs up. incentives to work. there is actually a cardiologist on the staff.

that atling to bet almost every big hospital, they are there to make sure that more cardiac catheterization are done. not there to study. they are there to get them done. people used to love this surgical care centers. this is going to drive costs down. yes, it drive cost down for gallbladders, which are used to subsidize open-heart surgery in big hospitals, so you drop prices down here, and they go off in hospitals. the system we, have, and the more stuff that you have that they provide, the more the incentive is to do more. one of the reasons i came. city, andn sioux

these are very proud people, and they are just so pleased that they have a candidate for doctor, andat is a they said, we are going to put a cardiac catheterization lab right here. that is a very lucrative saying. you are going to put a cardiac cath in, and the unspoken is it is going to be great revenue and good for the hospital, and one thing leads to another, and so forth. i am being polite, and i am saying, you have another hospital in this town which is a pretty good size. the cardiachey had catheterization lab? and they said, yes, and that is why we want one. i asked them if they had a process, and they said they do.

i said i would not let them have won because they do not need two in the city. if you say those kinds of things, you do not get the vote, all things considered, but the reason is when that cardiac catheterization lab opens, they have to pay for it, and the way they have to pay for it is to do more of them. i do not think there are any more crooked doctors than there are teachers, et cetera. there is a certain percentage of people everywhere that cheap, but most of us do not. the incentives are enormous. today, i just cannot wait to do 973 cardiac catheterization's, where i can charge $5,000 apiece for them. somebody comes and who is sick, and there is a question, and we do a cardiac catheterization, and we take it and look at it carefully, and we are not sure about something, not quite

positive, but maybe if we went back to do another one, we could get the final answer, and you scan or mri orct any expensive procedure you want here. maybe if we just did one more, and, actually, if you do an mri, it is easier. because with a cardiac catheterization, there is a risk. to there is no downside doing it, because the hospital makes more money, you make more money, and you convince yourself you can use the information, which is worth the more money, and it is no skin off the patient, because the insurance company is paying the bill. that is why all of these procedures drive up health insurance. more the procedures, the more the costs go up. of thecontrol all procedures that somebody can get, and you simply get paid a flat fee for every patient in

the system, now you have an incentive not to do procedures. now you make money by saving money. let's say you get 100,000 patients, and you get a certain amount of peace, that is your budget for those patients that year. more, evenget a dime if everybody needs a heart transplant. there are some potentials for abuse. and hospital executives are smart. the reason they are not innovative is because they have been paid for 30 years three times the rate of inflation for the same thing, and they are not stupid and will figure this out. do you know how i know they are going to figure things out? massachusetts, which has had obamacare for years, the largest conglomerate, maybe the best in the country, with an insurance company, and the hospital to compete with them in the boston suburbs have been bought by insurance companies.

those guys can go on the exchanges, and they can't compete with anthem and blue cross. all they do is aggregate and spread risk. inside, you determine how you want to spread the risk, and you control the expenditures, so what i am saying is that while this was designed for quality of care, they are able to compete directly with health insurance companies, and they are going to do a 20% cheaper, because 20% of that money goes to totally non- health-care expenditures. it goes to billing, big salaries and shareholders, so 20% off the top. aco should be able to beat them on the exchange. it does not say it will turn entity,ealth insurance

basically an hmo. it does not say that, but it would be smart to do that. fee. flat now, the first thing you said, did we not have the hmo, and did not everybody hate them? true. i actually work for an hmo. patients heard of the were from the hmo. i got $15 per month per patient. if they came in or not. i did not have to worry. if somebody had a problem that was chronic, i could treat them over the phone, never having to think, gee, how am i going to pay the nurse if i keep doing this? not a bad way to practice medicine. hmo's was not the way it was practiced, it was the insurance copies when they went to wall street, because they were an up-and-coming thing. they were a great idea. of course, when there is a great idea, some of the is going to make money on it, and they took

it public, and the minute they did that and became publicly held companies, their board of directors had two problems. one, there was a fiduciary responsibility to shareholders, it was to make as much money as possible for the share price to go up, and the other was to their patients to make sure they got good care. that was not a problem either until the market got saturated, and then when the market got saturated, you have to make those numbers every quarter i cutting costs, and they do that at the most vulnerable level, including patients and primary care physicians. q."?many of you saw "john it was a fantastic movie starring denzel washington. he was a guy who got sick, and the hmo was trying to pick it to him, and the kid was dying, and i think he ended up shooting up an era.

when the scene came where he said i am not going to take this anymore, everybody stood up in the movie theater and cheered. they were bad.se at kaiser, they were great. why? because they keep the primary care doctor really happy, and when the primary care doctor is happy, they tell the patients what kind of great care they are getting. was thee them not happy wall street traders in the 1990's. they were saying how much the insurance company sucks, and should they not need another one, because it was the fault of the insurance company that they could not get at us, why or z, and they should, and you have to remember that most hospitals in this country, the vast majority, and the best -- thels, nonprofit,

highest penetration of for- profit hospitals. why? they run up the tab when you get sick. areprofit hospitals different. they still make money. they run a positive balance sheet and also want to have a capital fund, but it is not the same as having to tell your shareholders every quarter that the share prices going up because the earnings just went up a little bit more than wall street thought, so the downfall the way thats not hmo's practice medicine. the reason that hmo's practiced the way they did was because people on wall street were forcing the cost cutting down at the expense of the patients, so what happens under a nonprofit andthat takes the dollars takes a flat fee and an fee for

service medicine is to mark the first thing that happens is the purchasing decisions are made by the people that actually control the purchasing, which is not the patient. not on the big ticket item. it is the provider. when you go to see somebody when you are really, really sick, if they say you need a liver transplant, you probably do not disagree. you probably say, if that is what i need, dock. 200 is somewhere near $50,000 to $1 million before you are done. there is no consumer input into that. but with an aco, there is now an incentive. you do not want to have to pay that money. taking risk for somebody's liver transplant.

you would certainly lose your license, or you can do what kaiser does. iu can income you know, if take care of this person who has these four risk factors of liver isease when they are 20, probably will not have to pay for a liver transplant when they are 50. if i take care of the 25-year- old with diabetes and teach them how to keep their sugar down, they probably will not need dialysis when they are 50. if i get people to stop smoking and to exercise or get them on a treadmill, i will probably keep their blood pressure down, and they probably will not need to take expensive drugs when they are 50 or 60. now converted our health care system from an illness system, which is today, because we get paid when you get really sick, to a wellness system, because now you make money when you keep your patient's well. the way to get stuff done is to

change the incentive system, and putting in the flat fee, getting rid of the fee for service medicine, and just charging a flat fee, they now have a tremendous incentive because they make more money when they keep you healthy. i think that is pretty incredible. decide whaty procedures to do and what procedures not to do, that is an thernal budgetary matter in aco. the hematologist against the cardiologist, who decides who should get what in which department, but i think that is much better than having the cost to be re-times greater than inflation, and it is much better than presenting a patient with a b will during our way -- a b will during -- bewildering array of options.

that is why i told you the story about the cardiac surgery chief. not in the bill. system from anur illness-based system to a wellness system, and it can give the hospital providers an incentive to compete directly with the insurance companies. and if you go to the hospital, they are going to send a a, fat bill. and you will have no idea if they happened or not, and they coded, so they can make more money, and at the insurance company it will be down-coded. rooms under ase

flat rate system, paid by the patient system, you are just going to get what you are going to get. you still need to keep track of what is done. our paid does not depend on it, but now, you no longer have all of that ailing infrastructure on either side. delivers health care --an aco delivers health care. rightan make that guess and go on the exchange to compete with the insurance company. doeshe insurance company is aggregate. they take your money. you choose the provider. they paid the bill, and they work with providers all of the time about the bill, a fight that they usually lose, and then the cost goes up 25% next year because they lost their butt.

to get i to shift back said something about paul ryan's plan. medicare costs are out of control, not because medicare is a bad program. in fact, the medicare overhead is about four percent of the dollars that come in, and what number have we been using for the system we have? 20%. medicare is actually a very efficient the stone, but because all health care loss are going up roughly a three times the rate of inflation for 30 years, medicare is a huge problem for the government. social security is not. with some minor tweaks, we can fix social security, but medicare is. paul ryan said instead of shifting the risks from the on this the patient theory, badly mistaken theory, because these folks have no understanding of how health care

works or how human beings work, , but sincerprising they could not understand that, they shifted it to the wrong people. you do not shift it to the patients because patients do not buy health care well, and they do not make rational choices. i am no better. i had my hip replaced. i know nothing about orthopedics. i was telling the nurse to do this or do that. we do not make good decisions buying health care, but we do make good decisions buying health insurance. burden had shifted the of controlling costs and maximizing patient benefit from by payer to the provider saying, i am going to make the number up, again, i do not know what it is, for every medicare recipient, they get $10,000, and

they can't take that $10,000, it is not a voucher, it is a payment. the payer has no budgetary control here. that is where the political and economics intersect, so you would get a $10,000 thing, and you could take it to any aco or any exchange you wanted. the risk is not to you but to the provider. now, again, you do have to have regulations, we guess will cheat and underserved, but people cheat in every system, so that iece, and ithe aco p think it is going to happen not because i dreamed it up but because there are smart people in the health care version. this is not as much as the republicans say.

and -- diluvian. there is going to be a lot of serious thinking in the private sector model. this is going to be one of the things that i think is really good. per capita payment. i am happy to take questions about nonhealth care related stuff, though i prefer to do health related stuff first. it is something that they came out with a study on, and the obama administration was furious with me because i thought they were right. the obama people thought it was damaging to them. they believe, and i believe this also. going to cause an

enormous exodus of people from employer-based elf insurance to individual based health insurance, people just going on the exchange to buy their own health insurance, and i think that is great. we have got to bring the link between employment and health insurance. medicare has done that, and here is why we have to do it. leaving aside health care and the political arguments. there is a strong argument. mccain actually proposed doing this. it, theime he proposed bottom had fallen out, because it was all about the economy, but it was a smart idea. link health care to employment, first of all, there are a great many people who are 55 or older who cannot change jobs, because if they do, they will never get insurance again. a lot of people lost their jobs during the recent recession cannot get health insurance. people will not hire them because they do not want to be responsible for giving them health care.

everybody in small business is essentially in two businesses. and run their own business, then they spend hours every week trying to figure out how to deal with the health care. problem,croeconomic with republicans, if they understood anything, would like this idea. we are at a competitive disadvantage, everybody knows, with china and mexico and thailand for labor reasons. their labor costs are higher. we are also at a disadvantage with canada and germany and france and the u.k. why? because when we have a fixed cost that goes up at three times thatate of inflation, means that they are becoming less competitive, and why is that? saythe entire, but let's about 75%, especially of big companies, they are paying that.

the business community is paying about 75% of that. in canada and germany, the costs are also going up three times the rate of inflation. they start at a lower base, but they are also going up more than they can afford. when the cost goes up at three times the rate of inflation in germany or canada or france or other western countries, that is spread across the entire society, everybody, not just the business people. it does not just affect the bottom line of the business community. thetaxes basically support system. when it happens here, the cost disproportionately feels -- falls on the business system. this is because this was disproportionate. they have more and more trouble competing.

if you spread this across the entire society, which is what they ultimately may do, then, i would argue, our businesses are going to be more competitive. getting it down is a different matter. different,ething getting employers out of the health care business. and i think small business is going to leave in a hurry. to have to pay, but it is so much cheaper that they will be happy to pay, and people will go on the exchange, and especially for low-wage workers, especially if they get health insurance now, they are going to be better off.

it is expensive enough. it is pretty good, and there will be a lot of small businesses. let me tell you who is not going to dump their patients into the exchange. small businesses with high engine ploy ease. if you are making $100,000 per year, your employer is not going to dump your health insurance. why? they are competing to make sure that really good and smart employees work for them. and we are not going to do this soon. the fortune 500. actually, other than kaiser, the fortune 500 have the best wellness programs in the country. why is that? because they are likely to have employee longevity.

bigou go to work for a place with big benefits and a lot of stability, you are going to stay there, and you may stay there for a long time. so it is in their benefit to have wellness. seen gymnasiums where they give you a free gymnasium membership. you think that is great. seen where they take attendance at the gym, and if you'd have not been there a certain number of times, it is coming out of your pay. and at a company about 28, sitting there, there were no chairs in the conference room. everybody was standing around in a circle, and that is their conference, and i am not making this up. i went to one place where there was actually a treadmill at each desk. that cannot be scientifically workable, but maybe it was. maybe it was some trial that we

will find out what happened. making isnt i am i amver we transition to, sure there are some single-payer fans in here. i am not sure we're ever going to have one single-payer. we already have single-payer. over 55 is single- payer. we also have a socialist system of medicine. republicans should like it because it is the veterans association. a socialist system, where the government owns the hospital and the employees. it is rated very highly by its own patients. and we have a free market system, supposedly, so i think what is going to happen is you are still going to have the socialist system. have theill going to

single-payer system, and those will likely get bigger over and then you are always going to have a system. if you have lots of money, you can go and pay your position outside of the system. the top five percent are always going to get what they want. let's not worry about the top five percent. 95% andrry about the stop worrying if somebody get something. human nature. so what i see ultimately is the end of the employer-based health care. now, we are going over a little bit about what that means, but why is that important. back to something we said earlier. and we are good about buying insurance.

the free market works. it just does not work well. the system skews all of the incentive, but in general, it is a terrific incentive. people do make smart decisions about spending money, and it market tot how people you, so now, each individual, right now, for the most part, care, moresed health employee choice. now, you can go on one of these exchanges, you can have gold, silver, platinum. you get to pick all kinds of things, and in the aggregate, yes, there will be people who make stupid mistakes and should know well and all of that, but in the aggregate, we do really well. one of the reasons our economy is coming back so quickly is that our decisions are not made centrally. 20 or 30 or 50 million business people make is this decisions, and that plus then bernanke, the

only common sense in the world to think that john maynard keynes was right and that the europeans were wrong, but those are the two things that saved our economy. there is no economic dogma in washington controls everything. every50 million people day making aggregate decisions, and people making aggregate decisions often end up right, especially when making business decisions. bads easier to make decisions when you get really mad about something. it does happen in business, but it does not happen so often. bigger supply and less all at one end of manhattan, and they do stupid things. theyconvinced each other are right. they all talk to each other and forget about everybody else, but notusiness, they do necessarily talk to each other. they are making rational

decisions every single day. that is what is going to happen in the health insurance market. you are going to make rational decisions every day. this does require good regulations. we will get to that in a second. but rational decisions are going to be made. if you have 50 million people every quarter or every year trying to decide what kind of health insurance. it is going to move the market, and it will move the market ultimately towards quality. crappy products, and they will find that if they did and do something different the next time they have to sign up again, and it will make people buy the best plan for themselves, and, again, not everybody will get it right, but the vast majority will get it right. a 55-year-old is not going to have trouble getting insurance. there is a flaw in the bill that does not quite make that true,

and we can go into that in the questioned period if you want. finally, i am going to talk about vermont and new hampshire very quickly because they are both outliers. new hampshire, i read, has one company on the exchange. that is a screwup for two reasons. first of all, the insurance commissioner should have done something about that, and apparently, it it excludes things that are not a hospital or not in the network. that is a mistake. that had nothing to do with obamacare. do second problem is if you not have a competitive marketplace, it is your job to go and make sure you do. tons of big,re are advance aco's who could do business in massachusetts. they would love to come up here and compete. you should be allowed to do it. i know that dartmouth and mary fletcher is forming a group.

they should be able to be on the exchange. it is not going to happen in 2014, but it should happen in 2015. in either have to regulate the hell out of them and tell them what they can charge, or you have to bring in competition, but that is the job of the federal government. right ift cannot run you only have one person on the exchange. -- that is a state issue. have only a single provider and they blame obamacare, that is not the administration's fault. that is the states fault. now, i think in general it is better to avoid regulation when you can't. i know that sounds republican. if you can do things by incentive or by competition, it is better to do things by regulation. not that all regulation is bad. the nature of regulation and laws, for those of you

interested in politics, most of my life has been in politics, so what we do in politics is we find five percent of the people andare doing a bad thing, then we try to regulate 100% of the people, and that means we drive 95% of the people crazy because we are in their way. it should not be the first call, if we can help it, but we are going to have to be a lot more regulatory in vermont that i would like, and that is because like new hampshire, we only have one aco, because we have one teaching hospital that has is no up, and there competition in the delivery so if they choose to offer care -- first of all, the insurance company has got no leverage, because there is only one. this is why partners with

insurance companies, all of the other hospitals went out of the market, so they would not be forced. we do not care what your negotiation stance is and what you want to pay us. we are going to charge what we want because you can not sell insurance without having partners in your way. it is a little like that in vermont. they can charge what they want. that, ther to fix only way to do that is regulation, and that is too back, because that is not the optimal way to go. this model was designed to have four or five insurance companies, and then the competitive market, so you can pick one insurance company against another. a public option not because i am a dogmatic liberal.

it is because i want a government standard. you're not like what insurance companies were offering you, you could have gone to get medicare. yearu decided after one you did not like that, you could go back to the public sector, but to have this with four percent overhead was a great thing to have in the exchange in order to regulate the insurance company behavior without a huge pile of regulations. now we have to go and spell out 27,000 pages of regulations to make insurance companies behave themselves. we would not have had to do that if, in my view, he had a public option. they did a terrible job. they would've had the opportunity to compete. a baseline organization. i also think politically it was not smart. it is a whole lot easier to explain a program that has 50 million people in it. but we do things the hard way in the democratic party. then it is to explain something

that we cannot read before we pass it so we can read it after we pass it. i do think, in conclusion, there is not all, because one state is not like the other. and the way this is going to be implemented is fascinating. not going to be able to make the payment deadline until november, that is fine. there will be eight to do about it. and you aret ready, not going to buy insurance anyway until january 1, but we are a small state. we are only going to have a single insurance company in your exchange, and that is going to be a problem for you. we are going to have to figure out how to fix that. but what happens in new hampshire is not an obama problem. it is a local problem that matters. because the republicans have refused to engage in the exchanges, some states have no there is, which means

one big federal exchange that is going to run the program. that has to be done right. this is what the liberals wanted. they wanted a single exchange. republicans, by their refusal to cooperate with the obama administration's much more moderate, free-market based what thes created others wanted. paying attention in washington, i do not believe you, but i will take this result. big change of the obama situation in the short term. it is to get this enormous exchange, and neither of our two is a are involved, to work properly. it will be an enormous problem. i think it will be an enormous help to the democrats, but it will be a great help to the people of the united states. that you do not hear much about. we do not hear much in washington about what is good for the public.

can argue all of the time about the republicans think and what the democrats think. but for the people of the country. and i want to close by giving thanks to a few republicans. many of whom i disagree with and some of whom i am sure i will work against in the next election cycle. of michigan. john kasich. chris christie of new jersey. .he are a number of republicans do not take the money is grossly immoral because it is the most vulnerable people in society that cannot get health insurance any other way. most of you know we have had universal health care for everybody under 18 in my state for years. we did that by getting a middle- class entitlement for children. there is no reason that that cannot happen in every state. texas, rick perry, running around with all of these

governors, telling them they should move jobs to texas. thate not heard them say 22% of all of the children have no health insurance under rick perry. this is a third world country in terms of their respect in the terms the people that make that country as great as it is, and those are american kids, and that >> representative moody. voted the number one legislator by the nation magazine. didn't know that? >> i want to make an observation room quickly. and i want to ask a question.

there are two votes holding new hampshire from getting the extension for medicaid. we are hoping that we can persuade those republicans to come over to our side so that new hampshire can. >> they can. they are up for election. >> it is too late then. the question that i have is that i read recently -- i am on , and id -- medicare appreciate medicare. if it was not for that, i would be in deep trouble. medicarecently that would approve transplants. you mentioned liver transplants. people will not be put on a waiting list he does medicare -- will only cover

three years. that is a lifetime. lists are being put on for transplants. can you address that question mark >> yes. it is competition. one of the reasons that medicaid and medicare patients are put on transplant lists have nothing to do with coverage, and has to do with age. at a certain age, liver transplants are inappropriate. law, is no cut off in the nor should there be. there's a point where every human body is not functioning. transplant with lists is that they are rationed and there isn't anything we can do about that. there are only so many people who died web livers that can be transplanted. sometimes you can get lucky and match. older livers are not so great.

they will not pay for the drugs. i'll get to that in a minute. in terms of liver transplants and heart transplants, these are complicated questions that don't have to do with money, they had to do with availability. girl in philadelphia who is classified as an adult synergy to have a partial transplant. great and is a heartwarming story. that means that there is a dead adult somewhere to go as they could not have a transplant. that is the debate we are having and this is tough stock terms of the drugs, this is why, in the long run, if we had a good health care system that makes -- or,or people under 65 better yet, put everyone on medicare. we could fix everything. there are a lot of rules put in place for a long number of years

that were not up for a debate. the discussion -- there is some discussion among the republicans of merging medicare into the rest of the system. what ryan was proposing was a voucher system where you would get money to buy your medicare from insurance companies. it makes no sense. medicare is run at a fifth of the price of insurance companies. rules, youave these have anomalies where this insurance pays for that and this insurance, even if it's government will not pay for that. i member john, when he was a went through a state-wide conversation about broadening out coverage and getting more people coverage. you raise a quite interesting question. the trouble is that you never come to a consensus.

all you can do is have a serious wide, where state- the media takes a constructive role in hashes out these issues. the girl who got the liver and somebody else did not, is a hard questions and hard for society. when you bring yourself into the ix, you have your own perspective. >> a question about the popularity of the affordable care act. we keep hearing that people do not like it. the whole country. at least, we're getting that from one side. what is the actual consensus? that peoplensus is do not like the affordable care act and do not know what is in it. there is a poll by pew, i'm not

sure, that a big sample. they had a big sample. we have done as much education as weekend. we have thrown everything at it. republicans is that all sorts of things about it, many of which are not true. now, we are three days -- we're three months away from d-day. the bar going to experience it and get on that. they're mostly going to save money. i think that is why republicans are so desperate and willing to shut down the government. once this bill goes into effect, people will realize that this is a good thing. >> governor, good to see you again. >> thank you. >> what can we do to affect other discussions on these issues.

health care, medicare, medicaid, and social security. to make sure that these conversations go forward in washington. >> i was about to give you an answer and then you said that last sentence. i think that, for now, the particular solution is not in washington. councils and in town councils. it is a voluntary organizations put together by 25-year-olds. innate -- there are three institutions that are broken. wall street, they are not allocating capital they are just shifting paper. the media, they do not cover serious things. they are an essential organization in our democracy to keep us accountable. 90% of the time spent is a waste. and, washington.

one party has decided that they're not going to play. until voters want to do something about it, it is not going to change. things do not change in washington. the change elsewhere and a move towards washington. washington is the last no. that is a fact -- washington is the last to know. that is a fact. in 1926ession started in agricultural states. people were starving and they put together social security programs. roosevelt made some security national program. whatever you do, you have to do and youur home state have made huge changes in new hampshire in just a few years. trying a few different things, according to electoral tastes. you are on a good track, to me. one of the things, grants you, i

live in vermont, but i see his farm-two-he country, table agriculture. that is not related to governor candidate will talk about. that is going to happen when people at the bottom do their own work and decide they're going to live that way. the answer to your question is, do not wait for washington. get done in your community and others will do the same. >> yes. has a microphone, i cannot see in the back. somebody already has a microphone. oh, pardon me. we have a new routine. the people who have a microphone, you decide who will answer the next question -- ask the next question. it depends.

-- 2000 -- what you mean? cost you -- cost to you? $7,000 -- it costs $7,000. there is no rhyme or reason. machine that takes the pictures is small. >> the mix in the room is interesting. of people would never question whether dr. have told them to take. -- what their doctor have told them to take. every time the good to buy something, the go, what does it cost? it is absurd.

there are two ways of the people of new hampshire are deserved. when you go to the doctor, you have no idea what the cost is going to be. two, more than 80% of the primary care is owned by hospitals. -- theirnot only business model is to funnel people into a system where they make money. doctor, i know that i'm going paid $2800 for an ai and i know they can go to freestanding center in denver nd get that for $650. thatbout a one-page bill

says, post your prices and tell us what it costs. anecdotally, there are two start companies that provide a service to the public. , howall them and you say much is it cost and where else can i go? that is powerful information. that, i would suggest, is health-care reform. i'm getting information and address of that i can get the mri on the same machine for 400% less than what it might cost me if i have insurance somewhere else. what is your comment on that? >> that sounds interesting and a lot of people have proposed that. that is an is that attractive thing for people who buy lots of things and may work for health care if you have to have an mri because you haven't mcl tear in your knee.

here's what happens. what you are suggesting is a good idea. i care about transparency. --s system adjusts to it by you get your mri for six or $50 revenueand ship the from the hospital to the insurance company. the hospital suddenly decides that they have a deficit and raise their rates to recover the dollars. the insurance company raises their rate and you get shifted. because yous go up just got a better deal with the mri. is ayou are advocating system that can never be entirely integrated. like the free market system for buying a car.

you're buying a car because you cannot have a car. it is a good idea but is not going to solve the health care reform problem. unless you stop fee for service, you are going to have people taking money. iswhat is going to happen people in the hospital system consumers -- the same thing. they will go to hospitals as of the company. >> that is starting to happen. is starting to happen in a variety of ways. -- it is starting to happen in a variety of ways.

that brings up an interesting thing that we have not touched on. people vote with their feet and do medical tourism. or, whether it happens of regulation or if it is paid for by the patient. what we have to have a big debate about is innovation. we are the most innovative nation in the world for health care. we create new procedures and do advanced diagnostics. some of you know that you can replace angordon -- a organ. there is a balloon apparatus that you can stick through a bunch of vessels. these are unbelievable thanks. -- things. in the united states, you can sell these devices and make a

ton of money. in a different system, without fee-for-service, you cannot get that. thaty in mexico will embed because they cannot sell 10,000 of them. sell at least for, they cannot break even. that is true pharmaceuticals. it is really complicated. my retort is, i do not think his bat do the things that you're talking about. i think that if we keep fee-for- service, we will have a warped system no matter what you do. , which could be any country, basin the example that you're using. it will have an effect but it will have a peculiar affect. -- effect. the insurance companies are essentially a aggregator of costs. when you send someone an mri,

somebody has to pay the difference. is know why the system persistent and will be so hard to change? it is because of the hospitals. is it because they have a great lobbying organization? actually not. on the board of your nonprofit hospital? think about it was on the board. the most prominent citizens. probably democrats and republicans who are pretty wealthy. they're probably pretty smart. the nonprofit hospital wants more people on their board. who are the people that the candidates go to see in each community all over the state right out the gate? the most prominent people in the trinity -- community. somebody -- when

somebody on the board, not just because he's on the board, but because he likes his person, he goes to washington and a bill comes up to reform health care and reduce the role of tertiary care hospitals to expand the role of primary care. who is to lose it that? -- at that? remember when i did that favor for you, i have a favor to ask you. this hospital will close at this if this bill -- passes. it is not done by lobbyist, is done by people in the community. the most importanty litician the community who spread the word and are looked up to.

those of the people in the hospital boards. on change is not just toward reform and the pharmaceutical lobby. we are doing this to ourselves. i had a prominent businessman a successful guy from vermont, a big republican, what in vermont, we are all pals. we are one last dates in the country that still talk to each other. he said, governor, you have to do something about health care. it is just killing us. i said, aren't you on the board of the medical center question mark he said, yeah i am. i said, how did you think you are going to pay for the bond? to get the bonds going paid off? the insurance premiums are going to go up. there would've to do more things in as good appellate the bonds. we are doing it to ourselves. even the busiest the book who are complaining are driving up the cost because -- starting the

cost. if you get rid of fee-for- service medicine, you make it more transparent. instead of doing it by procedure, you are doing it for a whole year's worth of health care. the united states can say that we are only giving military two percent budget. providers run the country will have to live for that. in the beginning, for the first 30 years, you would not get much decrease in the quality of health care. we spent 70% more gdp to the next highest expenditure, which is canada. we spent 70% more, as a percentage of gdp, the canada. canada. we don't have to do that. we estimate that in our system that we cannot get out because the investment we have in our current infrastructure is so

enormous. the political power extends deepest into every small community in america. we, in some ways, our our own worst enemies. until we can have a discussion about having a hospital. , cost control will be hard. i will defer to the microphone. >> i have a microphone. i have the microphone. two things, you don't know the you talkedspitals -- about the cost in hospitals, you get a bill from hospitals. it is a flat fee. it is, here's what the audiologists charged. here's the calcium. here's this.

826 is a markup . -- each one of these things has a markup. organizations, everything contained inside the organizations, i'm a patient, i do not want the doctor. i want the doctor over here. and i still have access question mark bugs let's take that second question first. you can have access to an out of system dr., but it will cost you more. goodde think it is a system. as long as you have that option, be my guest. we're pretty good at providing health insurance. you decide if it is worth it for you to pay more on your health insurance premiums to go outside the system. that, you can make consumer choice. we make sensible decisions, and that way. bills,stion about the

there's been a lot written and i do not subscribe to any of that. i don't know if anybody has gotten a bill lately, it is a joke. it is a meaningless exercise. out, halfld figure it the stuff -- somebody did a study for consumer reports, 90% of what is in the bill is wrong. this is crazy. why get a bill at all? like the bill, not because i want the itemized costs, because i want to know what was done to me. i would like to know that. that,n put any number on it is iparty paid my $10,000. i have already paid my $10,000. now that number may be a little

bit more maybe a little bit less . i would get rid of the bills altogether. and yousay, i paid you do it you have to make me healthy. you do it you have to do to keep me healthy so that i do not need the thyroid operation in the first place. >> last question. >> i want to shift gears. what you thoughts on the rising costs of education? -- what are your thoughts on the rising cost of education? >> it should be fixed. the only reason education costs have gotten away with this is because health care costs are worse. higher education have gone up twice the rate of inflation. in some ways, here's the problem, the short-term political fix makes it worse. making student loans more

available makes it worse. now, we did the administration's more ability to raise prices that you have to pay. oregon passed an interesting bill. i do not know if the worker not. the bill -- if it will work or not. the bill is, if you go to state college and you borrow money, 10 or sent three, 5, of your income -- percent of your income, that is the end of it. i like it because it lends some visibility. fort of people sign up these loans without realizing how awful it is going to be. it second thing it does is has the affect of doing

something to university administration that needs to be done but cannot be done short- term. what is going to happen and it because higherw, education is a free market system which is distorted by student loans, in some ways. what is happening now, because costs are so high, is that kids are deciding that they are not going to go -- i do not even know the cost is, let's pretend i'm talking about in another -- suppose it costs $30,000 year for in-state and i do two years of community college. greatey is one of the public colleges of the country. the decisions are being made like that all the country. people are saying, when i was money --p, bar the

borrow the money. kid, he didn't a have to worry about money. that's not so sure anymore. -- true. the first essay, do not take debt. first thing i say, do not take debt. if you come out with debt, you nt for indentured serve the rest of your life -- servant for the rest of your life. you're the payoff is debts and have a reasonable type of lifestyle. medicalnabling the schools to run up their tuitions, because you will pay it. unless you borrow -- once you

borrow the money, it is not their problem. stuff,use free market there's a big adjustment and people are not getting a good education. if you do what oregon is doing, and i am not endorsing this, i am intrigued by and want to know more about it, it is interesting. assume these universities are run by smart people. and theyn to this guy pay 10% of their income back, unless the become something with x, we aregreater than not going to get paid back. what is the average income level of our graduates? a recent study ranked the colleges by return on investment.

what was your cost going in and what did you make going out? it was a different list. they have access to those figures. they're doing economics that works in higher education in an attempt to fend off the trauma of a purer market based strategy. this, 3-5 years from now, people are going to go say, startingand in january, we're not going to pay our student loans. if that happens, a financial crisis that we just had is going to look small. this is an urgent problem and calls for creative solutions. let's take a look at what oregon did. are --

it is basically in charge students. -- it is based on what you can charge students. thank you very much. [applause] >> on behalf of the faculty and staff, i would like to thank you for speaking with us tonight. >> thank you very much. this is great. presidential primary -- new hampshire huh?dential primary, [indiscernible] &aonight, queuing day -- q

with toe because euro -- toby c osgrove. cosgrove,ek, toby discusses his 25 years of the cleveland clinic and medicine. us an overview of what the cleveland clinic is. practicea large group with 3200 positions. we have facilities in cleveland.