comprehension. host: this is what president obama said early in his administration, august of 2009, he spoke about this issue to the vfw convention. [video clip] >> irresponsibly we choose to reward the responsibility and service of our families. whether you left in 2009 or 1949, we will fulfill our responsibility to fulfill the benefit and care that you earned. i pledged to build nothing less than a 21st century v.a.. a lifelong soldier and wounded warrior will lead this fight, general richard shinseki. [applause]

we are dramatically increasing funding for veterans health care, including hundreds of millions of dollars to serve veterans a rural areas, as well as the unique needs of our growing number of women veterans. we are restoring access to the a health care for the half of a million veterans who lost eligibility in recent years. since there has been so much misinformation out there about health insurance reform, let me say this, the one thing that reform won't change is veterans health care. no one will take away your benefits, that is the plain and simple truth. host: that was the president from five years ago. in may of 2014, what has changed? or what has not changed? guest: nothing, really. this is a failure to reform and move forward as stated. he said it to us in our convention also, that he would do this along with the secretary, but we just have not seen it happen. host: why? guest: a good point.

every year the money continues to rise. 60% in the last six years. but it is how we spend that money. they spend it in bonuses for failure -- when you have a director in pittsburgh that allows six veterans to die and others being taken by legionella, for him to get a $63,000 bonus, that is one example. host: how do you repair the system? what needs to be fixed? guest: the priority should be that all veterans get the best health care in a timely manner, as needed. the screenings, the tests that veterans need to save their lives due to illnesses are just not happening right now and they need to get back in line. [indiscernible] -- --host: what have the experiences of federal -- fellow veterans been like? guest: it is like skin cancer.

it you have small pockets of it and take care of it, it will be all right, but if you don't take care of it you will die from skin cancer. there are 151 hospitals, 140 of them are doing a great job, but there is a pocket of about 10 or 11. some of them are getting great care. others have suffered from this -- misdiagnoses, like phoenix, and are being one example. host: there are between 9 million and 10 million veterans in the v.a. system, there has been a huge surge of people coming back in need of medical

care and mental health care. does the v.a. provide the assistance that you think he needs to for those who suffer from ptsd? host: they have not --guest: no, they haven't. i have been to 25 hospitals this year myself. i have only found two that have a fully stocked mental health section. they need to hire additional mental health specialists, whether it is fee-based, going outside private entities, or hiring additional people on staff, they need to do a better job because we have 22 veterans a day committing suicide, which is not acceptable. host: guest: --host: walk us through the process that has been put in place to call for the v.a. secretary to step down. guest: on april 18 i met with the secretary for over an hour in his office. we discussed many issues. the backlog of disability claims.

the health care being given. the disk -- construction delays for hospitals. i asked about firing those. at that point the v.a. had admitted to 23 preventable deaths and nothing had been done. i said -- we need to fire those people. he said -- i don't need to fire anyone, i need to retrain them. that put up a red flag for me. as we got to the spring meetings, that they word came -- the word came out that there were probably up to 40 preventable deaths also in phoenix. with everything we had seen going on, with what we had documented over a number of years on our website, you could see the pattern of continued failures. that was just the last straw, phoenix. so, we drafted a resolution and the vote was unanimous, to call for the resignation of secretary shinseki and the undersecretary.

host: daniel dellinger is joining a sermon the annapolis, the head of the national american legion, thank you for joining us this morning. guest: thank you, sir. host: we have aligned set aside for those of you who are veterans. walter, fitchburg, massachusetts, good morning. caller: good morning. commander, i am glad to speak with you. ironically, i still see my physicians in new york, even though i am in massachusetts. i am aware of something that you are, just to talk about v.a. personnel being fired and so forth, the conceit of the accountability bill, as it came before the senate, it has

occurred to me that a large portion of these individuals that work within the health care system are part of university hospitals. they are so-called partners. the question -- i have seen some strange things, up to and including, of course, the hospital in new orleans having not been opened since katrina, yet lsu is up and running. what we essentially have is a hole in the ground for the veterans in new orleans. by the way, calling for massachusetts, i am thoroughly involved in these situations, and yet very few people know this. in new york the health-care care system, the manhattan v.a. hospital is run by new york university. host: thank you for the call. let's get response. guest: i happened to be in new orleans back in the fall.

of course you have lsu there with tulane. most of the hospitals in this country partner with local universities to assist in care and to provide a teaching experience for the universities. those are good partnerships, they get high-quality care at those facilities. but new orleans was behind schedule and over budget. orlando, denver, las vegas -- which just opened last fall -- they are all over budget. in virginia is 17-64 months and schedule. host: the v.a. secretary is saying that the department is more towards private hospitals. this is the headline.

your reaction? that: if they are seeing they cannot get veterans in for screenings and tests, then they should be allowed to go to the outside. it is not our intention to do away with the va hospital system , is necessary because veterans have unique needs. but if it could be assisted by local hospitals and -- then we are in favor of it. dan dell and jerk, i want to go back to what the president said in 2009. dellinger, when the president spoke to reporters, i want to go back to the question why you think 5.5 years after he took office this problem has escalated to where we are at today. i think part of it is

veterans are losing their health benefits. they're looking to the v.a. now for care. you have more veterans that have agent orange that have come out. .hey get their care there now ptsd never goes away. i think some of the middle issues are also part of that. of course, you have the influx of the iraqi afghanistan veterans. -- the iraq and afghanistan veterans. they need help. that is what the v.a. is set up to do. they need to move forward with this. host: was it a lack of leadership? or was it a combination of

rising demand, hired to need and need and budget cuts? the secretary turn down moneys. the problem there was, are they using the right numbers? are they cooking the books? if the number of visits are down, they think they have enough money based on the number of visits. around the country, how many of around the country, how many of if you have this going on all these numbers are skewed? that is where the budget comes into it. that was also -- the secretary needs to come out and have that leadership that he showed in the military. put it to use in the va.

host: this tweet from one of our viewers, there is no proof that 40 veterans died as a direct result of delayed care. do you want to respond to that point? guest: right now, i would say i don't know how many. i said up to 40. i spoke with a persons during our recent town hall meeting in phoenix who came forward -- it was supposed to be in our commented that being three hours and 45 minutes. we listen to 62 different individuals talk about their health care, eight of them did talk about deaths that their loved ones sustained due to either lack of timing, or misdiagnosis at the va in phoenix alone. host: if you are listening on c-span radio, we're talking about the american legion, the va hospital system. our guest is dan dellinger, he is the national commander for the american legion, joining us from indianapolis, ed is on the phone from an kennedy.

caller: i was wondering about the funding issue, whether congress is going to look into this, and whether they're going to examine the budget problems. i just read a study from john f. kennedy school of government, and they said they va never -- the va never anticipated the large number of iraq and afghanistan veterans needing health care. it was never funded, it was never planned for, and part of this goes back to the bush of ministrations -- administration's horrible planning. they want a light footprint in iraq that they could get away with, and a light footprint turned into an eight year slaughter -- slog. we got bogged down in afghanistan, which was not planned for an eight year, nine-year war. i blame partially congress for not looking into these things, not investigating -- they are

going to investigate benghazi for the next five months. but they are not going to investigate the funding for the va. i think switching shinseki, and putting a different person and their won't cut it. you need to put more reform to it, do some planning an investigation. host: thanks very much for the call. guest: with that, it is true, and the senate as their hearing on the 15th, chairman sanders and members of the senate committee stated that once these came out, and if there is a need for additional money, that congress will go back and spend it and add money to the ba to deliver the care that is

expected. you go back to the secretary about his resigning -- when the president's advance team came to the white house and met with the bush administration, they were told at that time that there were possible problems with the way it was spent. this was the very first term. since that time, the general has been hired, he is supposed to work with the administration to take care of these issues. but it has been a failure all along. it hasn't been completely addressed. host: if you are interested, the department of veteran affairs does have a map taking a look at the veteran population on a state-by-state basis. it is available online at va.gov, this is what looks like as we go to james from taxes. -- james from texas. caller: the first thing i would like to tell you is there is one mistake that everyone is making.

the mentioned originally of the veterans department was to help those coming out of world war ii with medical problems. that mission has changed. the new mission of the veterans administration medical center is to train doctors. the needs of the doctors and the interns -- they come before the veterans. that is every veterans hospital i have been in. they schedule you according to what that in turn needs for his residency. that is a fact. host: james, thanks for the call. dan dellinger, your response. guest: i really haven't heard that, but we have what is called a system where saving goes in the hospitals and talks to the physicians and nurses, to see the quality of care they are given.

we write a report at the end of each year. we submit that the congress, i would need to go back and review that to see if i have actually seen that. but it is true that you have a lot of young doctors come in to satisfy the requirements, and they unfortunately do go on instead of staying, because they are not paid what they could receive in the outside arena. host: the house this past week took up a measure that passed overwhelmingly to allow the vga to hav -- the bea -- the va to have more control. this cumbersome and opposed hr 4031. what is your reaction? guest: i'm disappointed that the senate dropped it.

i don't know how they can look a veteran in the eye and say they would vote for this. you have to hold those administrators and those doctors accountable for preventable deaths. host: how big of a problem from your standpoint is this the -- for the president? guest: it should be huge. let's get with the program, and fix these decisions, and make the bea what it is supposed to be -- make the va what is supposed to be. >> host: if you had a chance to tell the president what you wanted, what would you say? guest: i need to tell them again that he needs to do a better job with the va hospitals, promotable deaths are not acceptable.

caller: i have talked to a couple of veterans, and they say -- host: you are getting some feedback, if you could go to another room, or else we will have to move on. caller: i have talked to quite a few veterans that can't get in to the va system, i don't know what the situation is. something about their serving in the military, i just can't get in there. i don't understand why.

not only that, i have seen quite -- i have seen several that's the passed away, and they couldn't get a flag on their coffin, because they couldn't come up with a dd 214. i wish that can be changed, in some way, somehow. host: ok, we will get a response. dan dellinger. guest: around the country we have service officers, and these service officers are trained and certified to help veterans with their claims. if you have anybody that is in need of assistance, and we don't recommend any veteran try to navigate this bureaucracy, and get into the system. you can go to our website, go to legion.org, go to services, and if you need a service officer, you can find one of those.

you can utilize -- it is in charge, it doesn't cost a cent. the american legion pays for everything that happens there. you can utilize that to get into the system if you are eligible to get into the system. as far as the flags, we fight that all the time. but again, if the service member has on record, or he is a part of the va system, he has a dd 214. we can also assist with obtaining those through st. louis. if anybody needs that, there are links that you can find out how to apply for your copy of your dd 214. if you go to the local american legion post and have it on file there, so when the time comes -- no family member at that time, in bereavement, needs to be trying to hunt down a dd 214 to get a flag placed on their loved one's coffin. host: this post from the pittsburgh post-gazette, 60 million americans, mostly men

serving in world war ii, called the greatest generation by tom brokaw, the greatest generation is quickly vanishing. one million out of the 16 million world war ii vets remain alive. the washington post took a look at veterans who served in congress. this was the last world war ii veteran to serve back in the 1980's, about a third of congress was veterans. you can see a pretty significant decline from their early mid 1980's to now i'm about 20% in the house and senate. dan dellinger, as you look at these numbers, does this in any way impact the passion that lawmakers may have towards veterans issues? guest: i would hope not. i would hope better and would be

put above politics, that's where they deserved to be. they put the uniform on, they fought for their country, they deserve the best health care and benefits possible. there are 17 senators, i think 78 congressman and women that served. and they are currently in the congress. but i mostly saying -- i see something across the country where a lot of these races, veterans are more and more starting to run for those offices. so it shouldn't depend upon whether or not you serve, because as i said, veterans are above that. host: our next call is bob, from new jersey. welcome to the program. caller: good morning. good morning commander. thank you for jumping into this

issue. i am 100% disabled, and i have heard a lot of people talking about the negative aspects of the va. i have to tell you, the pharmacy program is outstanding. it is an online program. one of the things they try to do is educate veterans, and where i go, i see a lot of people who were waiting for the va to do things for them, but they are not making too much of an effort. a class i went to, the instructor was excellent, the number of the guys were just there. all they did was complain, they didn't have anything to offer in the way of a solution. as far as general shinseki goes, with his imperatives that he set out in his plan, he needs to have a scorecard. there needs to be a serious evaluation of the results. the doctors, nurse petitioners, technician or is that have operated on may, that have done ultrasounds and mris, they have been terrific. the problem is the support staff, a lot of people walking around doing nothing. everyone knows that, someone

needs to just put it on the table. host: ok bob, we will get a response. guest: i agree with him. there is a survey out, and says 85% of all people that are seen in a va hospital are satisfied with their care, 95% of bears -- 95% of those would go back to a va dr. that's a part of the leadership that needs to be exerted by the president and the va. our veterans are getting good care. i testified in front of congress in april, promotable dents -- preventable deaths. a congressman asked me if i would grade the va, i said the care is 85 percentile, the care is less than that. host: let me get your reaction to this tweet, too bad they can't get leon panetta out of retirement.

who do you think would be a good replacement if eric shinseki steps down? guest: i don't know. i'm not in the medical field. i don't use used to be somebody who is strong in medical, or it ministration. this is a large corporation, it is the second largest agency in the federal government. there has to be someone brought in to make -- who can handle that and move it forward.

host: do you think you think you'll stay on through the end of the president's term? guest: he has said he will not resign, the president says he is doing a good job. we still think you should go because of his failed leadership and oversight issues. i don't know. host: weighing in on all of this, senator bernie sanders. he held a hearing that included eric shinseki earlier this month, he also talked about some of the looming issues facing the va hospitals around the country. here's a portion. [video clip] they're waiting list, why is that so? in certain parts of the country, they may not have the staff they need. i have called for more funding. obama's level of funding has been pretty good, but over the last three years, the system is

increased by 1.5 million people coming into the system, including some with serious issues. do they have the resources to do it? second of all, is the va allocating its resources appropriately? is the secretary firing people, does he have the capability to do that? we will do a hearing on that assumes the recess is over. host: your response to the comments of senator sanders. guest: i think it is spot on. he knows what is transpiring in today's va. that is what we have based our calling for his resignation on. there is failed leadership, there needs to be a better job done there. especially with ptsd, they don't have enough clinicians in the hospitals. very rarely do i go around --

the directors will tell me, give me that lipservice and say yes, we have enough personnel. maybe not in the right positions, but we have personnel. that is not what we're looking for, you have the right number of doctors, right number of nurses and mental health specialists to take care of our veterans? they need hire additional people. host: the department of veterans affairs indicating it is servicing 9 to 10 million veterans across the country. here's a breakdown of veterans by age. those who are 70 or over only about 6.7 million veterans, those between the ages of 41 to 69, 11.6 million, the total number of veterans in the u.s. is 23 million. caller: good morning to the

veterans affairs -- veterans member. i think that the leadership starts with him in. they have never addressed females being attacked, they have never addressed racism. they also i feel they are attacking obama on political lines, but they don't want to say it. if he has 85% approval, they are definitely in a good percentile. they are moving up all the time. we know that we had a bailout, we had money problems -- you have these wars, you have veterans coming back with all kinds of injuries that nobody has ever seen before. and he's saying leadership is not doing the proper thing. they are trying to keep up with the lack of leadership that came from past people, such as yourself. you have been in that organization a long time, and now you are putting your face

out there. but your face should have been out there 15 years ago, 20 years ago. the veterans have no one to fall but themselves, because the organization is run by veterans. host: we will go response. dan dellinger? guest: we know there have been issues with the baa, that's why -- with the va, that's why 10 years ago we put together a system worth saving. we hold a town hall meeting before we go into a hospital, the next day we go in, get a briefing from the director, whoever may offer that. we talked the clinicians, we talk to the patients, see what kind of health care they actually get. it is a tough duty, but we have been there, we will continue to be there. we were founded in 1919 to make sure we took care of veterans, we have been doing a good job of that for the last 95 years, we will continue to do that. as i told congress back in september, this is the cost of the plains of the bullets, this is the cost of 50 years of health care afterwards. this is what the administration -- it is not political.

believe me, it is not political. we feel is of the veterans deserve to be above all politics. that is what our stance. host: one of the news photographs, this from the orange county register, as communities across the country pay tribute to those who paid the ultimate sacrifice in america's battles overseas. we have a lot of comments about the wars in iraq and afghanistan, do you think the bush admin is ration thought through the full application of what we were about to undertake in those two wars? guest: that is a good question. if you look at those two wars -- i don't know if all the facts will be out for a number of years. it seems as if it takes 20 years

after war, after all of the review of everything, whether or not enough effort was put into that. those are all good questions. we are going to make sure that we are ready to take care of the 1.2 million men and women that will be coming off active duty here in the next four to five years. i think historians will have to tell us that. host: william, joining us from virginia. also a veteran. caller: good morning. we have a clinic in reitman, west virginia, that is a contract run clinic. it is the best run place i have ever seen. if you have a 9:00 appointment, and you get there 10 minutes till nine, you are out the door soon if you don't have a serious problem. the staff is really fantastic, they care, my personal doctor

there is a contract dr. she is not a be a doctor -- she is not a va dr. we are losing all this. they're going to bring in a va dr. from god knows where, to handle all of the veterans in the franklin, west virginia area. one day a week. that will be four days out of the month we will have an actual doctor. if we have something seriously wrong, they will have the video conference. that won't work, you know that. they are ruining our system, we have a contract that works perfectly. they are going to spend a bunch of money on a building across the street to put in an elevator, which i don't understand that at all.

but our system is great, our doctors are great. if something is wrong, like when i had stints put in, i went to washington dc. the people there were fantastic. host: william, thanks for the call. dan dellinger, did you want to respond to that? guest: yesterday. -- yes, i do. i agree with him. each person -- each part of the country is divided up into these different divisions. they look at the health care within each one of those. sometimes, why fix it if it is not broke, that is the old saying. we need to continue to deliver that health care. maybe they feel as if the amount of money they're are spending for those contracts can be reduced. of course they are always looking to try to reduce costs. maybe they didn't have a doctor at that point, when they went to the contract. but it is something the va is always looking at.

sometimes we agree, sometimes they don't. overall, the veterans are happy with the health care they receive. that is another example of that. i hope they look at that again, hopefully with these assessments, they will take that in to review when they make their choices. host: our guest is the national commander of the american legion, he is a former army infantry officer. he served during the vietnam war, in georgia. he retired from the army in the 80's, is a graduate from the university of pennsylvania. joining us from indianapolis. this tweet from a viewer, do you feel it partnership have a committee to look into this? guest: yes we do. there needs to be oversight. congressional oversight.

i know congressman miller and senator sanders are very adamant about getting information from the va so they can look into these deaths, and how the baa is -- how the va is running. host: our caller, lisa. caller: i have been seeing a doctor for 18 to 20 years, i don't get help from the va, we couldn't get help because they said his problems were before his enlistment. he got frustrated, i have been taking care of him all this time. i can't even get homeless stuff from him, because he has a dog, and he doesn't want to live in a city where his va center is, and he doesn't want to take psychiatric drugs. i think the homeless program money is way too restrictive,

and i would like you to comment on how the money gets allocated, who designs the programs, and why are they so restrictive? do you think there's anything that could be done to loosen up a little? it seems like a $25 day voucher for these guys, that would get them a cheap motel room or pay somebody in a private residence to give him a room with access to the kitchen would be a good idea. the va program people say that would fix the homeless problem, but they won't do it. guest: unfortunately, with the homeless programs, they are restrictive. i know in pennsylvania, american legion post actually have homes where they will take that and -- taken veterans, and help them. as far as getting benefits, i

suggest he contact the local american legion, or find a service officer within that area and see what you can do to help that individual. we are always there, that is why we were formed, to make sure we take care of our veterans. we will continue to do that. contact the local american legion, see what you can do. if not, and contact the state headquarters. host: let me conclude on one final point, this is a story from the dayton daily news that takes a look at the va budget. the most recent figures say they are at $153 billion, in 2006, the budget was $71 billion. it is doubled in a decade. if money isn't the problem, what is? guest: the problem is the leadership, and how those funds are allocated. i think that is why we need a

major overhaul of the va system, and that was what the general was hired to do. he has failed, and that is why we asked for his resignation. host: dan dellinger joining us on this memorial day weekend, looking specifically at the va. you can get more for by logging onto legion.org. thank you for being here. guest: thank you sir. times reporter leo shain examines how the veterans administration is funded and the health services a ride very at son discusses the availability of jobs for returning service members. we will take your calls and you can join the conversation on facebook and twitter. washington journal, live at 7:00 a.m. eastern on c-span.

>> next, indiana governor mike pence on medicaid alternatives. john sopko. h >> in some respects, apple and google arguably started at the same time. in thebviously started 1970's, but then steve jobs got fired from the company in the mid-1980's and apple went from a. of 10 or 15 years where its fortunes really declined steadily. it wasn't really until 1997, when steve jobs returned, that apple's fortunes really began to rebound. in fact, it is pretty well-known among people who pay attention

to what is going on in the valley, that when steve jobs came back, apple had 90 days of toh left before it was going in.r in some respects, you could say both companies started around the same time. >> tracing the origins of apple and google, monday on the communicators at eight a.m. eastern on c-span2. republican governor mike pence wants to expand health age. the obama administration would have to approve the expansion. the american enterprise institute hosted the governor and former u.s. representative on monday. this is about 50 minutes. >> good morning, ladies and

gentlemen. i'm delighted to welcome you to this morning's event featuring governor mike pence of indiana the title of this talk is market-based medicaid reform in the age of obamacare. we're looking with very much anticipation to hear about his state's new waiver proposal for obamacare and medicaid. mike pence was elected as the 50th governor in 2012. prior to that he was the representative in the sixth district for 6 terms. he has had a huge amount of experience. he has distinguished himself in his career. today's policy is no exception. it is my honor to welcome governor mike pence. [applause]

>> thank you for that introduction and for the hospitality. i'm grateful to you, not just for your hospitality today, but for really keeping the twin lights of freedom and enterprise burning brightly. aei's mission is about keeping the hope of opportunity of a better life, more vibrant society alive and well and promoting empirically grounded fresh ideas to make that possible. it is an honor to be with you today, and please join me again with thanking the american enterprise institute and arthur brooks for your great leadership.

[applause] like many of other admirers of yours and of your work here, arthur, i have been influenced by your writings and your sense of the term earned success. and i come from a state that works. it is a state where people value hard work. and so i see the principle of really earned success lived out every day in the 92 counties of indiana. i see it in the schoolteacher who looks at risk kids after school doubt the graduate and go

to college. i see it in the entrepreneurial business owner who started the business in their living room and now employs 50 people, or the police officer who takes pride in keeping the peace in our street, each and every day. i see in cities large and small across the state of indiana that principle that you have articulated, that people are happier and more motivated when they build something on their own, when they take greater ownership in their lives and they are the success, whatever level of success that is. and that principle is much of what brings me here today. i am here to talk about today is related to that point, and it concerns the future of health care in america, and particularly, how indiana has been leading the way for the kind of reform that i would

submit respects the dignity of every person regardless of their income and honors the aspiration of every person for a better life. i agree with the thinking here at american enterprise and that it made the case that reform-minded conservatives need to ensure that the safety net is well designed and strong to provide a firm basis. i cite none other than president ronald reagan, who would say in new york city in 1979 these words, "we have long since committed ourselves as a people to help those among us who cannot take care of themselves." but he added, "the federal government has proven to be the costliest and most inefficient provider of help we could possibly have."

i would submit reagan was right. the truth is the safety net does not need to be expanded as some in this town argue incessantly. it does not need to be abolished, as some also argue. it needs to be reformed. it needs to be made better. i believe that can best happen in a laboratory of innovation and democracy at the state level. think of what president reagan said so many years ago. we have long since committed ourselves to help people who cannot out themselves, but that the federal government itself was the least suited to be able to do that. and i come before you today to really say that when it comes to the issue of health care, i believe that people in my party need to be solutions conservatives, offering real alternatives to the

big-government answers of the liberal establishment, that are grounded in respect for the aspiration of every person to earn their own way, to succeed, to achieve self-sufficiency, and to do that in the best way possible, with the kind of innovation that can happen all across the country, on a state-by-state level. i say all this recognizing that this is the very antithesis of the approach embodied in the affordable care act. ordering every american to buy health insurance, whether they want it or need it or not, is not the answer to expanding access to affordable health care in america. i have said it before. i will say it again. obamacare must be repealed. and obamacare must be replaced

with market-based reforms and, as i will elaborate more today, with a flexible medicaid block program that allows the states to create innovative solutions at the point of the need. i have and will continue to advocate for congress and a president that has the political will to repeal obamacare so we can improve health care access and outcomes. some of you who have known me know that i was a pretty vocal opponent of obamacare when i was in congress. i said this law will not stand, and i believe that more today than ever before. even obamacare's architects are breathing easier, the program is still terribly flawed and should be repealed. it is bad for families and for america. and despite the great progress we've been making in our economy in the state of indiana, there's not a day goes by that i do not travel across the hoosier state and hear people tell me that the implementation of the affordable care act as a dampening effect

-- has a dampening effect hanging over indiana's economy and our nation's economy. it is truly stifling growth in america. early in our administration, i made it clear that indiana would not establish a state exchange. everyone knows the physical position of these exchanges is untenable. when the rates rise again, i predict you will see a drop in public support. it was a government takeover of health care. in the overly regulated top-down

structure, the law will never allow the exchanges to operate as freely as they should, and as a result access will stay the same or get worse as costs go up. i always thought that was the fundamental flaw of the argument on the other side. most people i talk to when i was in congress back home would say they were most concerned about the cost of health insurance. but the focus in the congress was not on lowering the cost of health insurance. it was about growing the size of government. that is how the affordable care act came to be. so obamacare needs to be repealed for all those good reasons, and i would submit to you for one more, because it is pushing a massive flawed medicaid program on the states. i believe a plan for a state-based medicaid reform is not only entirely consistent with a repeal of obamacare, but i believe it helps make the case for why repeal is needed. republicans in congress have long argued for reforming medicaid into a block grant so the states have flexibility to design better programs. i cannot think of a budget that i voted for during my years in

congress that did not include block-granting medicaid back to the states. i'd submit that in the debate states need to lead the way, like indiana is doing. last week i announced that the state of indiana will seek to do just that, to seek flexibility from the federal government to close what is known as the coverage gap by expanding our homegrown health care solution, the healthy indiana plan. i have been talking about using the healthy indiana plan as a basis for expansion of health care coverage in indiana since before i took office in january 2013. today i'm pleased to have the opportunity to share with each one of you the details of our administration's proposal to expand the healthy indiana plan and offer consumer-driven health care coverage to low-income hoosiers. first, background.

today in indiana, we have some 350,000 low-income working hoosiers, those below 100% of the federal poverty level. or for a family of four, that is about $24,000 a year. these are hoosiers who lack access to the insurance their neighbors enjoy. experts rightly call this the coverage cap. many hoosiers up to 138% of the level, $33,000 a year in income for a family of four, also cannot access affordable coverage and they live with uncertainty in their families. last week i had the opportunity to introduce the people of our state to a number of hoosiers that fall into this coverage gap, working men and women who are out rolling their sleeves up, oftentimes in the most difficult circumstances, but courageously

moving forward, providing for their families. people like becky kincaid, a proud hoosier who finds herself essentially for all intents and purposes caught in that gap, where her income does not give her the ability to purchase health insurance for herself or her families. some of our neighbors across the midwest have chosen to address the gap by expanding traditional medicaid. and i respect the decisions others have made. i'm here to talk about indiana. from the beginning of my tenure we have been saying no to obamacare in indiana. we declined a state-based exchange, and i have made it clear that we will not expand traditional medicaid on my watch. medicaid is not only broke. it is broken. medicaid is not a program we need to expand. medicaid is a program we need to

medicaid is a program we need to reform. it was nobly created some 50 years ago to help the poor and those with disabilities access quality health care. medicaid has morphed into a bureaucratic monstrosity that does less to help low-income people than advocates say. and obamacare advocates continue to promote medicaid expansion despite the evidence that the program does not work as it is supposed to. as an anticipated study in oregon showed, medicaid increased emergency room use by enrollees and produce health outcomes that were no better than being uninsured. other studies have shown health outcomes are no better and sometimes even worse for people that are covered by medicaid compared to those with no coverage at all. the truth is last year oregon's study should have sent

shockwaves to the rank of public health policy experts and advocates across the country. for some reason it did not do that. it should have caused people to ask themselves how expanding a program that does not improve health outcomes is the right approach for america or it is right to do that. if you care about low-income americans, why would you want to expand a program that provides such inadequate coverage? the only thing medicaid does well is make it on to the gao's risk of high-risk federal programs. we know doctors who see these individuals for free rather than dealing with medicaid. the program is prone to fraud and implicit in this gap in coverage and access. obamacare needs to be repealed for many reasons, including it is pushing a massive medicaid program on to the states.

some proponents of expansion, those who helped author that underlying legislation, the affordable care act, are satisfied with covering a vulnerable population with a program that is so deeply flawed, but i am not. fortunately, hoosiers have found a better way. in indiana we have found the way to base the program on away we know how to improve health and lowers costs, consumer-driven health care using health savings accounts. let me brag on the hoosier state for a second, and we think indiana is the birthplace of health savings accounts. some of you in the policy community remember the name j. patrick rooney. he was an insurance executive and a visionary. in addition to his idea, which

he called medical savings account, which he perhaps more than any other american popularized on capitol hill, and was able to achieve being added into the tax code as a pilot program, he also personally financed the first privately funded educational choice program in the united states of america. he was my friend, but he was a visionary hoosier, and we miss him. beginning with his vision, indiana became a centerpiece for the discussion about consumer-driven health care. today indiana has more public employees, 96% in our government enrolled with state plans, more than any other state. and our private market is has a higher percentage of people enrolled in consumer-driven plans compared to many other states. the healthy indiana plan, as

health savings accounts, makes the most sense being launched and piloted and expanded in a state where consumer-driven health care was born. six years ago against that backdrop and that progress, indiana became the very first state to successfully create a consumer-driven health plan to expand quality health insurance coverage to the population covered in medicaid. it was created on a pilot basis and we call it the healthy indiana plan, and it provides health savings accounts today to some 40,000 hoosiers and empowers them to take ownership of their health decisions. it works. the healthy indiana plan integrated the principles of consumerism within medicaid, encouraging enrollees to take charge of their health care and empowering them to act as consumers in the health care market.

here are some of the facts. healthy indiana plan has lowered inappropriate emergency room use by 7% compared to traditional medicaid during the course of the program. 60% of hip enrollees use preventative care, which is similar to the rates we see in general commercial market places. hip enrollees choose generic drugs at a higher rate. when you think in a broad sense, consumer-driven health plans have been shown to decrease health care spending by 25% across the country, and those public employees i mentioned in the state of indiana who have a 96% enrollment rate in health savings plans, that saves me about $23 million a year for taxpayers in indiana, thanks to the adoptions of those programs. we are beginning to see this downward trend in health care

costs within the healthy indiana plan as well. let me say hip enrollees have a proven track record of managing their health care decisions. 93% make contributions of their savings account on time. 1/3 of them say they asked their providers about the cost of services. 98% say they would enroll in hip again if they were given a choice. in a word, indiana has proven in the last six years that consumer-driven health care works and it works for those that are starting out on the first rung of the ladder of the american dream. because of the success, last week my administration announced plans to submit a waiver to replace traditional medicaid in indiana for all able-bodied adults with an expanded version of the healthy indiana plan. this will go for those up to 138% of the federal poverty

level, and we call it hip 2.0. my kids like that. hip 2.0 would offer three options, and i would want to roll with them through with you quickly. first would be a premium assistance plan that would help working hoosiers access employer coverage, and, second, we have two health savings account-like plans with varying degrees of coverage. it is a three-legged stool. he called it hip length, hip plus, and hip basic. each of these would allow consumers to increase access to care. first off, in hip 2.0 we would

offer hip link, a program for people who have access to their health care today but may not be able to afford it. this is a defined contribution premium assistance program, and it is the first of its kind in the united states. those who qualify for hip link would receive a deposit into their account which they can use for premiums and deductibles. secondly is the first of the two health savings account-like programs. hip plus is available to all qualified hip members. those contributions will range from $3 a month to $25 a month based on income.

the plan offers enhanced coverage and a drug program that covers maternity services with no cost-sharing during pregnancy. lastly is hip basic, a default plan. it is exclusively for hoosiers below 100% of the federal poverty level who fail to make their contributions to their health savings account. members of this plan must make co-pays, they will receive fewer benefits until they can begin to contribute to their health savings account again and move back into the hip plus program. again, by way of summary, the premium assistance program helps people employed but can't afford their plan. the enhanced health savings account plan, hip plus, provide incentives to save and use preventative care, offers a more generous set of benefits.

the second health seems account plan but serves as a default for those under 100% of poverty. it contains incentives for them to reenter the hip plus program. both plans penalize inappropriate emergency room use and encourage preventative care instead. contributions are required for all hip members who choose one of the plans. those above 100% of federal poverty level risk losing their coverage entirely if they do not make contributions. those below 100%, should they stop making contributions, must make co-pays, and receive fewer benefits until they make contributions again. the amounts are reasonable and fair by income level and are designed to be that way. as we have seen in our pilot

program, low-income working hoosiers and our state take pride in managing their accounts and making their contributions to their health savings account consistently. and we are proud of that fact. a couple other elements. the plan also includes what we call a gateway to work program that will connect those who qualify for hip coverage with job training and search programs offered by the state program so they can move up and out of the program. hip 2.0 is not an entitlement. it is a safety net program that aligns incentives with human aspirations. the plan also includes high co-pays for inappropriate er use, to encourage enrollees to use primary care rather than emergency room care. and i am pleased to say that hip 2.0 will be fully funded at no additional cost to taxpayers. hip 2.0 will be funded for a

combination of federal funds an agreement with indiana's hospitals who have partnered with us to improve access to to health care coverage within indiana. this means if approved by the federal government, our waiver will allow us to expand health care coverage to hundreds of thousands of hoosiers with no new state spending and no tax increases required. now, if i have not thoroughly confused you, or if i have, you can go to our website and read about hip 2.0. hip.in.gov. learn more about this program. i think hip 2.0 maintains emphasis on the principles that animate my political career, and i think we are at the very heart of the people of our state and the people of this country. we put the emphasis on personal responsibility. they also represent an effort in

indiana to find innovative and fiscally responsible ways to get people the care they need. performing traditional medicaid through this kind of market-based consumer-driven approach i believe is essential to creating better health outcomes for the people of our state and curbing dramatic growth in medicaid spending for the people of our country. i believe that once obamacare is repealed that the plan we are proposing will serve as a model for what block-granted programs could be instituted across the country. with this i will close. i will be pleased to take some questions. i believe there are only two futures for health care in america today. there is government-driven health care, or there is consumer-driven health care. years ago when the healthy indiana plan was adopted,

indiana chose the better portion by embracing consumer-driven health care, having eligible hoosiers empowered to make their own health care decisions. now we are seeking permission from the government in the form of a waiver to build on that choice by expanding the healthy indiana and for more working hoosiers. hip 2.0 takes consumer-driven medicaid reform to the next level, are replacing traditional medicaid in indiana for all nondisabled adults and offering instead a culture that is but one healthy decision-making. let me say hip 2.0 is not intended to be a long-term entitlement program. our hope is people will not be on it long at all. but will transition into the private insurance marketplace, that there opportunities will allow them to move out of the program and obtain insurance in the marketplace.

hip 2.0 is a safety net that aligns incentives with earned success hope, and opportunity. the truth is the soft paternalism of the modern welfare state has failed to honor the dignity of the working poor in many ways. by failing to give them the benefit of the doubt, and by failing to believe in them, in indiana we believe in our people. regardless of their income among regardless of where they find themselves on the path to success, and hip 2.0 is designed and built with that faith and that confidence in the people of indiana and their ability to take hold of their futures if given the opportunity to prosper. lastly, let me close here at this policy group and surrounded by so many think-tank people,

let me ground this more in the world in which i work every day. i think as we talk about policies and coverage and health care reform, the debates that take face on cable television and on the airwaves across the country, we must never forget we are talking about real people, working people, who deserve a better way. hip 2.0 and our proposal to reform traditional medicaid in indiana is about reaching out to people that are working hard to build a better future, but simply do not have the ability, do not have the means in the health insurance economy that we have today to be able to provide coverage for themselves and for their families.

they simply don't have the ability, don't have the means in the health insurance economy we have today to be able to provide coverage for themselves or for their families. but they are real hoosiers. and i've talked to many of them across our state. since i have begun to serve as governor. one of them, i will close with, was named diana. i met diana at a visit to a community hospital in indianapolis. just a few weeks back. she was in with a heart condition that she said it was ok if i came around anyway. she was self-conscious about how she looked, and i try to set her at ease. i told her, you look great. i sat down next to her bed, i took her by the hand. she told me her story. diana had lost her insurance when she lost her job. shortly thereafter she started having chest pain. even though she knew she could

go to the emergency room and get treatment, she waited. she actually told me sitting up in her bed, she said the doctors tell me i put off coming in a little too long. but she said i didn't want to come in because i was embarrassed. because i didn't have insurance. i thank god she is ok. and i've prayed for her more than once since that day at her bedside. but she touched my heart. i mean, here was a hard-working woman who just wanted to find a way to pay her own way and not rely on the free access of a public hospital. i think diana is like a lot of working hoosiers.

people they don't want a handout, but they need a hand up. you know, in indiana we have long cherished the principle that you should love your neighbor as yourself. and that we should never walk by on the opposite side of the road when someone is hurting and in need. i think it's what makes indiana special. and let me just say, that is what hip 2.0 is all about. respecting the dignity of every hoosier, including our working poor, to find a way to cover themselves and their families, respecting their ability to make their own health care choices, and empowering them to lead healthier and better lives. i think the healthy indiana plan is a better way.

better health, better coverage, to a better health care system and better coverage for people in the state of indiana and beyond. i hope it will help other states as well and serve as yet another reason why we should start over on health care reform in america, why we should repeal obama care and replace it with a plan that includes consumer driven health care for low income americans and empowers them and their families to meet their needs and make their own way. thank you very much. i appreciate your time and attention today. [applause] >> i think we have little time for questions. go ahead.

>> i am the head of the hsa coalition. i want to thank you for mentioning my mentor and his role in this. secondly, i want to endorse what you're doing here. i think it's incredibly innovative. i think it is incredibly courageous. you've got tremendous street credit for the 96% of state employees who are using hsc's now. in addition to that, your hip one plan is the only one in the country like it and results are clear on their face. people save money, you save money, and you bring personal responsibility and choice within a government construct under an obama construct, and that is no small trick tom a so i just want to say thumbs up. >> thank you very much for that.

i appreciate it. we are proud of our heritage of health savings accounts in indiana. we believe it is an idea that was born in the hoosier state. someone asked me last week after we now says, why are you expanding the healthy indiana plan? i said because it works. i have worked in this town for about 12 years and everybody has always got a new idea. this isn't a new idea. this has been in the field working for people eligible for medicaid in indiana. it's also working for our state employees, and that's the very practical core of why we want to expand this program. >> my name is barbara and i am a nurse and caretaker and i want to thank you for the work you are doing on this.

does healthy indiana work through a combination of health savings accounts and sometimes a modified insurance? and does it have to work within the mandatory benefits package that sometimes gives too much of one kind of care and not enough of another and drives up cost? >> the short answer is, and i recommend that you go -- i will plug it for our c-span audience again. read all about it, but it's basically a three legged stool. the first piece of it, hip link, basically allows individuals to use what would be the state's contribution to their health savings account for premium assistance. there is a lot of people in this category. again, if you walk out of here with no other realization, this is a program that we are

designing to meet the needs of working hoosiers. these are people with jobs, maybe they have fallen on hard times, but these are people who are working for a living are aspiring to work for a living. the first would be the premium assistance piece allows people to purchase health insurance they might not otherwise be able to afford through their employer. as i said, and this is for the technical people in the room, it's the first of its kind in the country. it is in effect a voucher for people to use these public resources and go purchase their piece of their health insurance through their employer. the other two pieces, hip plus is very much designed after our current healthy indiana plan today and it's a true health savings account. there are consequences for nonpayment. it's open to everybody that is eligible within the population of two 138% of the federal poverty level, but to your last

point, for people under 100% of the federal poverty level, given current federal regulations, there's a certain minimum amount of coverage that within the waiver that we have today in the waiver that we are requiring, cannot be denied, but the way we structured it is in effect by making the full health savings account land, the hip less, more attractive, imminently affordable, with better benefits. we have every confidence that people are going to choose the hip plus lan in increasing measure and believe we have created what we call a value proposition that will drive people to that outcome. but again, our waiver has been structured within existing federal law and regulations. yes, right here. go ahead. >> my name is jim gandalf.

chairman of the hsa council and we represent about 92% -- the words you used here today really resonated. it is one i use would the democratic center for years ago. what you're doing, i can tell you, and we're happy to share this with anyone who is interested in hearing it, we can tell you that the outcomes that derived from ownership and dignity of ownership will drive correct choice and will, over time, teach our fellow americans all the way across the country how to handle their health care expenses. so we endorse you. we thank you for what you are doing, and congratulations. >> thank you, i didn't know that when i called on you. >> is there an appetite with other republican administrations in the state today, your fellow governors, to follow this type

of example? >> i'm traveling from here on the train to go to the republican governors association. i expect there will be some conversation about this. so i will defer on that second one, but thank you for your very eloquent statement about health savings accounts and their value. the reason i'm so enthusiastic about indiana's leadership on consumer driven health care is because it's better for people tell to give people a greater opportunity to take ownership in their health care decisions there's that old saying that when you've got your health, you have lots of problem. when you don't have your health, you have one problem. in my family and yours, we all aspire to good health. what is great about consumer

driven health care, and yes, there are the advantages of it. it tends the cost curve. it is slowing down the rate of inflation in the health care economy today. i get all of that. i get more excited when i talk to somebody working for a small business in indiana or in the healthy indiana plan today that says my life got better because i have incentive to take advantage of preventive medicine. i found out some things i could do in the area of smoking cessation, or losing weight, or all these different areas that a lot of people that had the opportunity to avail yourself of primary care on a regular basis, go see your own doctor, you take for granted. but for people to have greater access to and have the incentive to take greater ownership in their own health care choices, which is the very core of that original vision for consumer

driven health care and health savings accounts, is what i get most excited about. >> i was wondering, obviously the obama administration is very motivated to close this coverage gap you talked about. do you think there was a moment when you have more leverage to -- what you're looking for in this waiver. i wonder if you could talk about those negotiations in this particular moment when you're working for the same goal. >> we haven't shaken hands on this deal yet, but i'm hopeful what i can tell you is that right after i was elected governor, i said then that i did not believe indiana should set

up a state-based exchange, and i ruled out expansion of traditional medicaid in the state of indiana, for all the reasons i stated today, and i have stood by that decision. early in our administration, we reached out to officials to seek to renew our existing healthy indiana plan. our waiver was running out, and as i reached out to officials at health and human services, and i spoke to the secretary and our team met with them, we said we have a two step process here. first, because the healthy indiana plan had been such an unambiguous success for the people of indiana, some 40,000 hoosiers enrolled in this today, 40,000 that are all medicaid eligible. my first objective was, i wanted to preserve the healthy indiana plan. and frankly in the wake of the 2012 elections, there were some

that speculated we wouldn't be able to do that with traditional medicaid expansion available, there was a lot of skepticism whether the administration would be willing to extend waiver, but we made very clear what our position was and that if we were able to see the healthy indiana plan waiver renewed, that we would then be willing to continue a dialogue about using the healthy indiana plan and consumer driven health care as a framework for further discussion. i must tell you that i continue to be very grateful for the good faith negotiations that took place between our administration and the administration in washington over the renewal of existing healthy indiana plan, and we secured a one-year extension the middle of last year. since that time, i would say we have been in continuous discussion with federal officials and the proposal we

unveiled last week has been a result of that dialogue. again, there is not agreement on it, but we remain hopeful that the administration will allow the state of indiana to continue to build on the healthy indiana plan, and in effect build on our commitment to medicaid reform in the state of indiana. so that's how we characterize the discussions, but they have been ongoing. we are in a comment period right now where we have unveiled a proposal. the law requires us to collect comments from across the state of indiana, and then we will be submitting the waiver formally sometime next month it then i expect the discussions will continue their, but we believe the proposals we unveiled last week is the right proposal for the people of indiana and we