called "universal nightmare." you will not get this information in the mainstream obamamania media. have a great night. [captioning made possible by fox news channel] captioned by the national captioning institute --www.ncicap.org-- captioned by the national captioning institute --www.ncicap.org-- bret: i am bret baier. you are looking live at the east room inside the white house. we are awaiting the start of president obama's formal news conference. it is his fourth in prime time. george w. bush had four prime- time news conferences over his eight years in office. the main topic will be health care reform. the president will deliver an opening statement before taking questions. let's check in with the bill o'reilly for a look at what is coming up right after the news conference. bill: 9:00 this evening, a special addiction -- special

edition of "the factor." we will analyze the president's joust tonight. we will bring in dennis miller. he is worked up about the barbara boxer controversy. we will look at aaron anders being victimized by a cyber starkelker. back to you. bret: sounds like a good show. we will be watching. this is the fifth formal news conference, his fourth prime- time news conference. the big discussion is about how the health care reform package will be paid for. the president said he wants it to be deficit-neutral. he does not want to to increase the deficit. the congressional budget office has come out with a pretty sour projection when it comes to whether it will raise the deficit. that is one of the things the president will talk about tonight.

president barack obama. >> before i take your questions, i want to talk about the progress we are making on health insurance reform and where it fits into our broader economic strategy. six months ago, i took office amid the worst recession in half a century. we were losing an average of 700,000 jobs per month and our financial system was on the verge of collapse. as a result of the actions we took in those first weeks, we have been able to pull our economy back from the brink. we took steps to stabilize our financial institutions and our housing market. we passed the recovery act that has already saved jobs and created new ones. it has delivered billions in tax relief to families and small businesses and extended unemployment insurance and health insurance to those who have been laid off. we still have a long way to go. the recovery act will continue to save and create more jobs over the next two years.

i realize this is little comfort to those americans who are currently out of work. i will be honest. new hiring is always one of the last things to bounce back after recession. the fact is that even before this crisis hit, we had an economy that was creating a good deal of wealth for those people at the very top, but not good- paying jobs for the rest of americans. it is an economy that was not ready to compete in the 20% three, one where we have been slowed in clean energy technologies, where we have watched our graduation rates lag behind too much of the world come and where we spend more on health care than any other nation but are not healthier for it. that is why i have said that even as we rescue this economy, we must rebuild it stronger than before. health insurance reform is central to that effort. this is not just about the 47 million americans who have no

health insurance at all. reform is about every american who has steered that they may lose their coverage if they become sick, lose their jobs, or change their job. it is about every small business that has been forced to lay off employees or cut back on their coverage because it became too expensive. it is about the fact that the biggest driving force behind our federal deficit is the skyrocketing cost of medicare and medicaid. let me be clear. if we do not control these costs, we will not be able to control our deficit. if we do not reform health care, your premiums and out-of-pocket costs will continue to skyrocket. if we do not act, 14,000 americans will continue to lose their health insurance every single day. these are the consequences of inaction. these are the stakes of the debate we are having right now. i realize that with all the charges and criticisms that are being thrown around in washington, a lot of americans

might be wondering, what is in this for me? how does my family stand to benefit from health insurance reform? tonight, i want to answer those questions. even though congress is working through a few key issues, we already have agreement on the following areas. if you have health insurance, the reform we're proposing will provide you with more security and more stability. it will keep government out of health care decisions, giving you the option to keep your insurance if you are happy with that. it will prevent insurance companies from dropping your coverage if you get sick. it will give you the security of knowing that if you lose your job, if you move, or if you change your job, you will still be able to have coverage. it will limit the amount your insurance company can force you to pay for your medical costs out of your own pocket. it will cover preventive care like check ups and mammograms that save lives and money. if you do not have health insurance or are a small

business, you will be able to choose a quality, affordable health plan through a health insurance exchange, a marketplace that promotes choice and competition. finally, no insurance company will be allowed to deny you coverage because of a pre- existing medical condition. i have also pledged that health insurance reform will not add to our deficit over the next decade. i mean it. in the past eight years, we have seen the enactment of two tax cuts, primarily for the wealthiest of americans, and a medicare prescription program, none of which were paid for. that is partly why i inherited a $1.30 trillion deficit. that will not happen with health insurance reform. it will be paid for. 2/3 of the costs of reform can be paid for by reallocating money that is simply being wasted in federal health-care programs. this includes over $100 billion of subsidies that go to insurance companies as part of medicare. the subsidies do nothing to improve care for our seniors.

the congress has already embraced these proposals. they are currently working through proposals. i insist that health care not be paid for on the backs of middle- class families. in addition to making sure this plan does not add to the deficit in the short term, the bill i sign must also slow the growth of health-care costs in the long run. our proposals would change incentives so that doctors and nurses are free to give patients the best care, just not the most expensive care. the nation's largest organization representing doctors and nurses have embraced our plans. we also want to create an independent group of doctors and experts who are empowered to eliminate waste and inefficiency in medicare on an annual basis, a proposal that could save more money and ensure long term, financial help for medicare. overall, our proposals will improve the quality of care for seniors and save them thousands

on prescription drugs, which is why the aarp has endorsed our reforms. not all of the measures i just mentioned were contained in the draft legislation. we are now seeing agreement, thanks to the work that has been done over the last few days. even though we still have a few issues to work out, what is remarkable is not how far we have left to go, but how far we have already come. i understand how easy it is for this town to become consumed in the game of politics, to turn every issue into running tally of who is up and who's down. one republican strategist told his party that even though they make -- they might want to compromise, it is better politics to "go for the kill." another republican senator said that defeating health care reform is about "breaking" me. this is not about me. i have great health insurance, and so does every member of congress. this is about the letters i read

when i sit in the oval office every day. this is about a woman who paid $700 per month to her insurance company, only to find out they would not pay for cancer treatment. she had to use her retirement funds to save her life. it is about the college graduate whose health insurance expired when he changed jobs and woke up from an emergency surgery with $10,000 worth of debt. this is about every family, every business, and every taxpayer who continues to shoulder the burden of a problem that washington has failed to solve for decades. this debate is not a game. they cannot afford to wait any longer for reform. they are counting on us to get this done. they are looking to us for leadership. we cannot let them down. we will pass reform that lowers cost, promotes choice, and provides coverage that every american can count on. we will do it this year. with that, i will take your questions. we are going to start off with

the associated press. >> thank you, mr. president. congress is trying to figure out how to pay for all of this. have you told house and senate leaders which of their ideas are acceptable to you? are you willing to share that stand of yours with the american people? if you have not given that kind of direction to congressional leaders, are you willing to explain why you are not stepping in, since you are the ones setting a deadline? >> before we talk about how to pay for it, let's talk about what exactly needs to be done. the reason i want to emphasize this is because there has been misinformation out there. right now, premiums for families that have health insurance have doubled over the last 10 years. they have gone up three times faster than wages. what we know is if the current trends continue, more families

are going to lose health care. more families are going to be in a position where they keep their health care, but it takes a bigger bite out of the budget. employers will put more costs on employees, or they will stop providing health care. we know that with health care inflation on the curvet it is on, we will see medicare and medicaid basically break the federal budget. we know that we are spending, on average, about $6,000 more than of their advanced countries where they are just as healthy. i have said this before. if you found out that your neighbor had gotten the same car for $6,000 less, you would want to figure out how to get that deal. that is what reform is all about. how can we make sure that we are getting the best bang for our health care dollar?

2/3 of the cost of health care reform, which includes providing coverage for people who do not have it, making it more affordable for folks who do, and making sure that we are over the long term creating the kinds of systems where prevention and wellness and information technologies make the system more efficient, that the entire cost of that has to be paid for. it has to be deficit neutral. we abided by 2/3 of those costs to be paid for by tax dollars that are being spent right now. taxpayers are putting this money into the kitty. they are not getting a good deal for the money they're spending. that takes care of 2/3 of the cost. the remaining 1/3 is what the argument has been about of late. what i have said is that there may be a number of different ways to raise money. i put forward what i thought was the best proposal, which was to limit the deductions, the itemized deductions, for the wealthiest americans.

people like myself could take the same percentage reduction that middle-class families do. that would raise sufficient funds for that final 1/3. so far, we have not seen any of the bills about that. other ideas are out there. i continue to think my idea is the best one, but i am not foreclosing some of these other ideas that the committees are working through. the one commitment that i have been clear about is that i do not want that final 1/3 of the cost of health care to be completely shouldered on the backs of middle-class families who are already struggling in a difficult economy. if i see a proposal that is primarily funded through taxing middle-class families, i will be opposed to that. i think there are better ways to do it. i have not yet seen what the senate finance committee is

producing. they have got a number of ideas. we have not seen a final draft. the house suggested a surcharge on wealthy americans. my understanding, although i have not seen the final version, is that there has been talk of making that only apply to families whose joint in the -- joint income is $1 million. to me, that meets my principle that it is not being shouldered by families who are already having a tough time. i want to see what emerges from these committees, continuing to work to find more savings, because i think it is possible for us to fund even more of this process for identifying waste in the system, try to narrow as much as possible the new revenue that is needed on the front end, and then see how we can piece this thing together in a way that is acceptable to both democrats and i hope some republicans. >> is that your job? >> absolutely, it is my job.

i'm the president. this has to get done. the broader point, if somebody told you that there is a plan out there that is guaranteed to double your health care cost of the next 10 years, that is guaranteed to result in more americans losing their health care, and that is by far the biggest contributor to our federal deficit, i think most people would be opposed to that. that is the status quo. that is what we have right now. if we do not change, we cannot expect a different result. that is why i think this is so important, not only for those families out there who are struggling and to need some protection from abuses in the insurance industry or protection from skyrocketing costs, but it is also important for our economy. it is important for families,

wages, and incomes. when premiums are going up and the costs are going up, that his money that could be going into people's wages and incomes. over the last decade, we basically some middle-class families, their incomes and wages flat line. part of the reason is because health-care costs are gobbling that up. that is why i say -- even if we do not reduce our health care costs by the $6,000 that we are paying more than any other country on earth, if we reduce it by $2,000 or $3,000, that is money in people's pockets. that is possible to do. we will have to make some changes. we have to change how health care is delivered so that doctors are being paid for the quality of care, not the quantity of care. we have got to make information

technology more effective. we have got to have the medical system worked in teams of people do not go through five different tests. those are all critical to do, and we can do them. i understand that people are feeling uncertain about it. they feel anxious, partly because we have become so cynical about what government can accomplish. people's attitudes are, even though i do not like this double, at least i know it. i like this devil better than the one i do not know. people have not seen a lot of laws coming out of washington lately that help them. my hope is, and i am confident, that when people look at the cost of doing nothing, they will say, we can make this happen. we have made big changes before. the resulting in a better life for the american people.

david alexander williams. >> thank you, mr. president. you have been pushing congress to pass health care reform by august. why the rush? are you worried that if you don't, the effort will collapse? >> a couple ofn points coupleumber on -- a couple of points. number one, i get letters every day from families who are being clobbered by health care costs. they ask me if i can help. a middle-aged couple will say, my daughter just found out she has leukemia and if i do not do something soon, we will either go bankrupt or we will not be able to provide our daughter with the care that she needs. in a country like ours, that is not right. that is part of my rush.

the second thing is the fact that if you do not set deadlines in this town, things don't happen. the default position is inertia. doing something always creates some people who are unhappy. there's always going to be some interests out there that decide, you know what? the status quo was working for me a little bit better. the fact that we have made some much progress where we have got doctors, nurses, hospitals, even the pharmaceutical industry, aarp, saying that this makes sense to do, i think it means the stars are lined and we need to take advantage of that. i do think it is important to get this right. if, at the end of the day, i do not yet see that we have it

right, then i am not going to sign a bill that add to our deficit. i will not sign a bill that does not reduce health-care inflation so that families as well as government are saving money. i will not sign a bill that i don't think will work. my measure of whether things work or not is listening to the american people and also listening to health care experts who have shown that, in some communities, health care is cheaper and delivers a better result. i think we can achieve that. i am confident that if we just keep at it, we keep working, we are diligent, we are honest, if we take criticisms that are out there and modify whatever plans are already working through congress so it meets those concerns and criticisms, that we can arrive at a bill that will

improve the lives of the american people. i will give you one example. i think there was legitimate concern that we have not incorporated all of the measures that could reduce health-care inflation over the long term in some of the versions of health care reform that were coming out of the committee. over the last week, working with not only health care experts, but also members of congress who were concerned about this, we actually have now got and a commitment to incorporate an idea that has a panel of doctors and health-care experts advising on how we can get a better value for our money in medicare. every expert out there says this can be a valuable tool to start reducing inflation over the long term. can i say this? if we have not had any kind of

deadline, that change probably never would have surfaced until who knows when. so, i want to do this right, but the american people need some relief. >> we were just talking in that question about reducing health care inflation, reducing costs. can you explain how you will expand coverage? is it fair to say -- will this bill cover all americans who are uninsured, or is this going to take a mandate, or is this something that is not your bill, and if it does not get all the way there, can we say how far is enough? 20 million more? i can sign that. 10 million more, i cannot. >> i want to cover everybody. now, the truth is that unless you have what is called a

single-payer system in which everyone is already covered, you are probably not going to reach every single individual. there is always going to be somebody out there who thinks they're indestructible and does not want to get health care, does not bother getting health care, and unfortunately, when they get hit by a bus, and up in the emergency room and the rest of us have to pay for it. the overwhelming majority of americans want health care. millions of them cannot afford it. the plan that i have put forward and what we're seeing in congress would cover at least 97% to 90% of americans. there may still be people left out there who, even though there is an individual mandate, even though they are required to purchase health insurance, might still not get it.

or, despite subsidies, they are in such dire straits, it is hard for them to afford it. you might give them a hard to exemption. go ahead. -- give them a hardship exemption. go ahead. the basic idea should become if you want health care, you should be able to get affordable health care. given the waste that is already in the system right now, if we just a redesign certain elements of health care, we can pay for that. we can pay for it in the short term and we can also pay for it in the long term. in fact, the average american family is paying thousands of dollars in hidden costs in their insurance premiums to pay for what is called uncompensated care, people who show up at the emergency room because they do not have a primary-care physician. if we can get those people

insured, and instead of having a foot amputation because of advanced diabetes, they are getting a nutritionist who is working with them to make sure that they are keeping their diet where it needs to be, that will save us all money in the long term. >> you mentioned two republicans in your opening statement. you have 60 democratic seats in the house. if you do not get this, isn't this a fight inside the democratic party? you cannot really blame the republicans for this one. >> first of all, you have not seen me out they're blaming the republicans. i have been a little frustrated by some of the misinformation that has been coming out of the republicans. that has to do with politics. if you have somebody up there

saying, not, let's get the best bill possible, but let's try to beat this so we can gain political advantage, well, that is not what the american people expect. i am very appreciative that people like chuck grassley, people like olympia snowe have been serious in engaging democrats in trying to figure out how we get a system that works. even in those committees where you did not see republican votes, we have seen republican ideas. in the committee in the senate, 160 republican amendments were adopted into that bill. they have good ideas to contribute. the politics may dictate that they don't vote for health care reform because they think, you know, it will make obama more vulnerable, but if they have got

a good idea, we will still take it. in terms of democrats, the fact of the matter is that because this is a big issue, i think that a lot of democrats have a lot of different ideas. some of them have to do with regional disparities. you have some democrats who are concerned that the medicare reimbursement rates in their communities are too low. they would like to see the bill incorporates higher rates for doctors and providers in rural communities to incentivize good care in those communities. that is a legitimate concern. the minute you bring up that concern, and that adds money, that means we have to find additional dollars. this is part of the normal give- and-take of the legislative process. i'm confident we will have a bill that democrats and some republicans support. jake. >> thank you, mr. president.

you said earlier that you wanted to tell the american people what is in it for them, how will their family benefit from health care reform. experts say that in addition to the benefits you are pushing, there is going to have to be some sacrifice in order for there to be true cost cutting measures, such as americans sitting on choices. you do not talk about the sacrifices that americans have to make. do you think that other than some tax increases on the wealthiest of americans, the american people will have to give anything up in order for this to happen? >> they are going to have to give up paying for things that do not make them healthier. speaking as an american, i think that is the kind of change you want. if hospitals and doctors are not

coordinating enough to have you just take one test when you come in because of an illness, but have you take one test, then go to another specialist and take a second test, then go to another specialist and take a third test, and nobody is bothering to send the test to the next doctors, you are wasting money. you may not see it, because if you have health insurance, it is being sent to the insurance company, but that is raising your premiums. it is raising everybody's premiums. that money is coming out of your pocket. we are also subsidizing some of that because there are tax breaks for health care. not only is it costing you money in terms of higher premiums, it is costing you as a taxpayer. i want to change that. every american should want to change that. why would we want to pay for things that do not work?

here is what i'm confident about. if doctors and patients have the best information about what works and what doesn't, they will want to pay for what works. if there is a blue pill and a red pill and the blue pill is half the price and works just as well, why not pay half price for the thing that will make you well? the system right now does not incentivize that. those are the changes that are going to be needed inside the system. it will require patients as well as doctors and hospitals to be more discriminating consumers. i think that is a good thing because ultimately, we cannot afford this.

we just cannot afford what we are doing right now. just to raise a broader issue that i think has colored how we look at health care reform, let me just talk about deficit and debt. part of what has been happening in this debate is the american people are understandably queasy about the huge deficits we are facing right now. the feeling is, all right, we have the bank bailout. we have the recovery package. we have the supplemental. we have the budget. we're seeing trillion's here and trillions there. legitimately, people are saying, we are in a recession. i am cutting back. all i see is government spending more and more money.

that argument, i think, has been used effectively by people who do not want to change health care to suggest that somehow this is one more government program. i want to address that very quickly. first of all, let's understand that when i came in, we had a 1.3 trillion dollars deficit -- $1.30 trillion deficit. we had to immediately move forward with the stimulus package because the american economy had lost trillions of dollars of wealth. consumers have lost through their 401k's, through home values. they had lost trillions of dollars. that all just went away. that was the day i was sworn in. it was already happening. we had 700,000 jobs being lost. we thought it was very important

to put in place a recovery package that would help stabilize the economy. then, we had to pass a budget, by law, and our budget had a 10- year projection. i want to be clear about this. if we had done nothing, if you have the same old budget as opposed to the changes we made, you would have a $9.30 trillion deficit over the next 10 years. because of the changes we have made, it will be $7.10 trillion. that is not good, but it is $2.20 trillion less than it would have been if we had the same policies in place when we came in. so, the reason i point this out is to say that the debt and the deficit are deep concerns of mine. i am very worried about federal

spending. the steps that we have taken so far have reduced federal spending over the next 10 years by $2.20 trillion. it is not enough. in order for us to do more, we are not only going to have to eliminate waste in the system, and we had a big victory yesterday by eliminating the weapons program that the pentagon had repeatedly said we did not need, so we are going to have to eliminate waste there, we are going to have to do all kinds of reforms in our budgeting, but we are also going to have to change health care. otherwise, we cannot close that $7.10 trillion gap in the way that the american people want it to change. so far, everybody that is out there who has heard the idea that the obama administration wants to spend and spend, the fact is that we inherited an

enormous deficit, enormous long- term debt protection. we have not reduced as much as we need to and as i would like to. health care reform is not going to add to that deficit. it is designed to lower it. that is part of the reason it is so important to do and do now. >> on medicare, there are millions of americans who would depend on medicare. when you talk about spending and long-term policy, when you talk about cuts in the current proposal on capitol hill, you talk about cuts in medicare. there are never many specifics. specifically, what kind of sacrifice are you calling on beneficiaries to make? art future beneficiaries going to be getting less generous benefits?

what do you think about taking it out of the political realm? >> on the second point, that is what our proposal is. it is called the med-pack program. it was originally a republican idea. the republican congress passed a bill that created a panel of health care experts to make recommendations to congress on how we could get better quality and lower cost. the problem is coming every year, it would go on a shelf and nobody would act on it. we have said, let's give that body some power. let's require congress to vote on the proposals that they are making every year. congress can still reject them. it is not completely removing it from politics. they have to reject or accept it as a package.

that, i think, would incentivize and empower important changes. here is the thing i want to emphasize. it is not going to reduce bennett care benefits. what is going to do is to change how those benefits are delivered so that they are more efficient. let me give you a very specific example. you have heard that as a consequence of our efforts at reform, the pharmaceutical industry has already said they're willing to put $80 billion on the table. why is that? the reason is because there is probably even more waste than $80 billion in terms of how the drug plan in medicare is administered. we might be able to get $100 billion out of it or more. the pharmaceutical industry voluntarily said, here is $80 billion. you know what that means? that means that senior citizens who right now have a donut hole

in their plan, were after spending a certain amount on prescription drugs, suddenly they drop off a cliff and they have to pocket the entire cost, suddenly, half of that is filled. that is a hard commitment that we already have. that is a change in how we are delivering medicare. you know what? it turns out that it means out- of-pocket savings for seniors. that is why aarp has endorsed us. >> any promise that health-care negotiations would take place on c-span, and it has not happened. your administration turned out to request from a watchdog group. the inspector general said your white house is withholding information on the bank bailout. are you fulfilling your promise of transparency in the white house? >> on the list of health care

executives who visited us, most of the time, you guys have been in there taking pictures. it has not been a secret. we just sent a letter of providing a full list of all of these executives. these have mostly been at least photo spreads where you could see who was participating. with respect to all of the negotiations not being on c- span, you will recall, in this very room, our kickoff event was hear on c-span -- was here on c- span. at a certain point, you start getting into all kinds of different meetings. senate finance is having a meeting. the house is having a meeting. if they wanted those to be on c- span, i would welcome that. i do not think there are a lot of secrets going on in there. the last question with respect to tarp, let me take a look at what exactly they say we have

not provided. i think we have provided much greater transparency than existed prior to our administration coming in. it is a big program. i do not know what exactly has been requested. i will find out and i will have an answer for you. >> he said the recent bank problems indicate there has been no sense of remorse on wall street for risky behavior, so we have not seen a change in culture. do you think that you're ministration needs to be taking a harder line with wall street? would you consider going a step further and supporting a fee on risky activities that go beyond traditional lending? >> we were on the verge of a

complete financial meltdown. the reason was because wall street took extraordinary risks with other people's money. there were peddling loans that they knew could never be paid back. they were flipping those loans and leveraging those loans, higher mountains of debt were being built on loans that were unsound. all of us now are paying the price. i believe it was the right thing to do. as unpopular as it is, it was the right thing for us to do to step in to make sure that the financial system did not collapse. things would be even worse today had those steps not been taken. it originated under the bush administration. we continued it because, whether you are on the left or the right, if you talk to

economists, they said that this could have the kind of consequences that could drop us into a deep depression, not simply of severe recession. one of the success stories of the past six months is that we really have seen a stabilization in the financial system. it is not where it needs to be, but people are no longer talking about the financial system falling off a cliff. we have stepped away from the brink. that is important. it means there are a lot of companies right now that can go into the marketplace and borrow money to fund inventory from payroll, and that will help the economy grow as a whole. the problem is, now that the financial system has bounced back, what you're seeing is that banks are starting to make profits again. some of them have paid back the tarp money they received, the

bank bailout money received. we expect more of them to pay it back. that is a good thing. we also think it is a good thing that their profitable again. that means they have reserves in place and they can win. this is america. if your profitable in a free- market system, you benefit. what we have not seen, i think, is the kind of change in behavior and practices on wall street that would ensure that we don't find ourselves in a fix again where we have to bail out these folks while they are taking huge risks and taking huge bonuses. what do i think we need to do? we have got to pass financial regulatory reform. this is an example where folks say, well, should the obama administration be taking on too much? the fact of the matter is that

if we don't pass financial regulatory reform, and banks are going to go back to the same things they were doing before. in some ways, it could be worse because now they know the federal government might think that they are too big to fail. if they are not constrained, they could take even more risks. there are a number of elements of financial regulatory reform with respect to compensation. i would like to think people would feel embarrassed and would not get a multimillion-dollar bonuses. if shame does not work, then i think one proposal that i propose is to make sure that at least shareholders of these companies know what their executives are being compensated. that might force some reduction. for banks that are still receiving taxpayer assistance, we have a set of rules that

gives us some control on reducing unwarranted compensation. in terms of the last. he made, the possibility of fees for transactions we want to discourage, that is one of the ideas that will be working its way through the process. at minimum, we want to make sure that, to the extent the federal government is going to have to be a backstop, just like the federal deposit insurance corp., fdic, the reason why when you put deposits in your bank you can have confidence it is insured, that is insured through bank fees. we might need a similar mechanism in place for some of these other far out transactions. if you want to do them, you have to put something into the kitty to make sure that if you screw up, it is not taxpayer dollars

that have to pay for it, but it is dollars coming out of your profits. steve from "the cleveland plain dealer." >> so many americans are concerned that this plan, particularly the public auction for insurance, would lead to reduced coverage. can you guarantee that this legislation will lock in and say the government will never deny any services, that will be decided by the doctor and patient, the doctor will not deny coverage? secondarily, can you say that you and the congress will abide by the same benefits in that public option? >> number one, not only the public auction, but the insurance regulation we want to put in place will largely match up with what members of congress are getting through the federal employee plant. that is a good example of what

we're trying to build for the american people, the same thing that congress and joyous. there is a market -- that congress and joyce -- congress enjoys. we have spoken about a public auction to help keep the insurance companies honest. if insurance companies are providing good care, and they will be more regulated so they cannot deny you care because of a pre-existing condition or because you change jobs or because they have decided you are too sick and not a good risk, with regulation, there will already be some improvement in the insurance industry. having a public plan out there that also shows that maybe if you take some of the profit out, maybe if you're producing some of the administrative costs, you can get a better deal, that will incentivize the private sector to do even better.

that is a good thing. that is a good thing. there have been reports just over the last couple of days of insurance companies making record profits, right now, at a time when everyone is being hammered. they are making record profits. what is the constraint on that? how can you ensure that those costs are not being passed on to employers or passed on to employees, the american people, ordinary, middle-class families, in a way that will make them grow up? part of it is to make sure there's competition out there. to get to your original question, can i guarantee that there are going to be no changes in the health care delivery system? no. the whole point is to encourage changes that work for the

american people and make them healthy. the government already is making some of these decisions. insurance companies right now are making those decisions. part of what we want to do is to make sure that those decisions are being made by doctors and medical experts based on evidence, based on what works. that is not how it is working right now. that is not how it is working right now. right now, doctors are forced to make decisions based on the fee payment schedule. if you come in and you have got a bad sore throat or your child has a bad sore throat or has repeated sore throats, the doctor might look at the reimbursement system and say to themselves, you know what? i make more money if i take this kid's tonsils out. that might be the right thing to do. i would rather have that dr. making those decisions just based on whether you really need

the tonsils out or whether it might make more sense just to change -- maybe they have allergies. part of what we want to do is to free doctors, patients, hospitals to make decisions based on what is best for care. that is the whole idea behind the cleveland clinic. i will be visiting your home town tomorrow to go to the cleveland clinic to show why their system works so well. part of the reason is they have set up a system where patient care is the primary concern, not bureaucracy, what forms need to be filled out, what do we get reimbursed for, those are changes i think the american people want to see. >> [inaudible] >> i would be happy to abide by

the same benefit package. i will be honest with you. i'm the president of the united states. i have a doctor following me every minute. this is not about me. i have got the best health care in the world. i am trying to make sure that everybody has good health care. they don't right now. >> [inaudible] >> i said steve. he just stood up. >> you cited the cleveland clinic as a model for the delivery of health care. the mayo clinic has problems. what you expect to achieve tomorrow by going to the cleveland clinic? are you expecting some form of

endorsement from the cleveland clinic? >> i am not expecting an endorsement. the cleveland clinic is simply a role model for some of the kind of changes that we want to see. i think it is important to note that the mayo clinic was initially critical and concerned about whether there were enough changes in the delili system and cost-saving measures in the original house bill. after they found out that we have put forward very specific mechanisms for this med-pack idea, this idea of getting experts out of health care in making decisions based on the best evidence, they wrote theyblogs -- they wrote in blogs that they thought it would make a difference. >> recently, a professor was arrested at his home in cambridge. what does that incidents say to

you and what does it say about race relations in america? >> i should say at the outset that skip gates is a friend. i might be a little biased here. i do not know all the facts. what has been reported, though, is that the guy for got his keys. he was jimmying his way into the house. there was a report in to the police station that there might be a burglary taking place. so far, so good. if i was trying to jigger -- well, this is my house now. let's say my old house in chicago. here, i would get shot. [laughter] so far, so good. the police are doing what they should. there is a call. investigate what happens. at that point, professor gates

is already in his house. the police officer comes in. i am sure there is some exchange of words. my understanding is that professor gates then shows his id to show that this is his house. he gets arrested for disorderly conduct. the charges are later dropped. i do not know, not having been there and not seeing all the facts, what role race played in that. i think it is fair to say any of us would be pretty angry. the cambridge police acted stupidly in arresting somebody when there was already proved that they were in their own home. what i think we know apart from this incident is that there is a

long history in this country of african-americans and latinos being stopped by law-enforcement disproportionately. that is a fact. as you know, when i was in the state legislature in illinois, we worked on a racial profiling bill because there was indisputable evidence that blacks and hispanics were being stopped disproportionately. that is a sign, an example of how race remains a factor in this society. that does not lessen the incredible progress that has been made. i am standing here as testimony to the progress that has been made. yet, the fact of the matter is that this still haunts us. even when there are honest misunderstandings, the fact that blacks and hispanics are picked up more frequently and often times for no cause casts suspicion even when there is

good cause. that is why i think the more we are working with local law enforcement to improve policing techniques so that we are eliminating potential bias, the safer everybody is going to be. all right? thank you, everybody. bret: president obama took 11 questions over about 55 minutes. he says he believes the stars are lined to pass health care reform this year. he insisted whatever plan comes out of congress will have to be paid for. it cannot increase the deficit. he said a proposal by house democrats to levy a surcharge on families making more than $1 million per year "meets his principle of not putting the burden on middle-class families." he also said existing government health-care programs medicare and medicaid are the biggest driving force behind our deficit and said that he was -- he has "deep concerns about the debt

and deficit." echoing what his chief of staff told a reporter this week, the president insisted his administration has been able to pull the economy back from the brink, but there is a long way to go. henry louis gates jr. was apparently arrested after breaking into his own house. the president said the cambridge police acted stupidly, but he would not say the case was centered on race. he did say that race issues still haunt this country. let's get quick thoughts from our panel about the news. steve hayes, juan williams, and charles krauthammer. >> i thought the real interesting take away was that he tried to sell what could be the first up in the government taking over 1/6 of the u.s. economy using the language of conservatives. by my count, we heard the word "waste" at least five times. he talked about these reforms keeping government out of

decisions. he talked about a marketplace that promotes choice and competition. he said several times that he understands the cynicism of the american public about government waste and inefficiency. i think he tried to mask his ambitious proposal in the language of conservatives. >> i was disappointed he did not say more. i think this was a lost opportunity. this was a chance for him to rebuild support for health care and get the momentum going. it is all but obvious that the august deadline is out of reach. this press conference seems to be a signal that he is about talking in general terms. when it came specifically to the issue of what is going on with the democrats, are accusing the democrats? he simply acted as if he was in denial. he said, no big issue. things will come along in time. he acted as if there was no large group of blue dog democrats who are blocking this right now, today, as we speak.

finally, he spoke about being queasy, having uneasiness. >> on the contrary, i was impressed because he denies reality and does it with such elegance. he is amazing. he spent an hour selling a free lunch and i think he did it rather well. it seems as if we will increase coverage, guaranteed coverage, improve health care at no cost, except for a couple of millionaires. this is quite amazing. i think he did it in a way in which he was untouched. no question even nicked him. he said medicare is bending the curve down and he will improve the conditions for seniors. i was impressed. i think he carried it off elegantly. bret: