>> rose: welcome to e broadcast. tonight we take a lookt health care refm, first, the president's ime time press conferencehis eveng. and then peter orszag, president oba's principal budg offial, the director ofthe fice of management and budget. >> ts is a very iortant sector of the ecomy. it has importa implicaons for households and state governmes and all of us and, again, there's aeason this hasn'tappened in 50 years. this is hard to do. but if you lookat the aliment of forces and look at the progresshat has been made, it's qte significant. >> rose: we conclud with dr. denis cortese. he's a physician and c.e.o. of the mayo clinic, one of e leing medical cente the world.

the problem is we don have a health care system. there's nevebeen one designed. nobody h consously said what do we rlly want outf health care? we've never sat down to desig a system because if we've had, where are if sysm engineer who design it so we can blame them. >> rose:an't find them. >> there ist one. so that... frankly, though, that thought is powerful liberating cause it says if we realize we don't have a system, maybe we can sit back and sortof desn one. and sit down and say what do we rely want out of heth care? >> rose: health care refm wi oba, orszag and cortese ming up

ptioning sponsored by rose communications fromur studios in new york city, this is charrose. >> rose: health care rorm is our subjecthis evening. itas become, along with the economy, the most portant and presng domestic concernfor the president. increasingly, he's giving inrviews and tonight had a prime time press conferce to speak to health car rorm and other issue here is whate said out health care. >> even as weescue this economy from a full blown crisis we must rebuild it stronger than before and healthnsurance reform is central that effort. is is not just about the 47 million americans who dot he y health insurancet all. reforms about every american who has eve feared that they may

lose their coverage if they become too sick o lose their job orhange their job. it's about eve small business that's been forced to lay off employees or cut bac on their coverage because it became too expensive. 's about the fact that the biggest drivinforce behindour federal deficit is the skyrocketing cost of dicare and medicaid. let me be clear: if we do not ntrol these cts, we will not able to contr our deficit. if we do not reform health care, your priums and out-of-poct costs will continu to skyrocket. if we don't act, 14,0 americans will continue to lose their health insurance every single day these are the consequences of inaction. these are e stakes ofhe debate that we' having right now. realize that with all the charges and criticms that are being thrown around in washington a lot of americans may be wondering "what's in this for me? hodoes my faly stand to

nefit from health insurance rerm?" so tonig i want to aner ose questions because even though congresis still rking throug a few key issues,e already hav rough agreement on the following areas. ifou have health insurance, e reform we're proposing wil providyou with more security and more stability. it will keep government out o healthcare decisions, giving you the option to keep your insurance if you're happy with it. it will prevent insurance companiefrom dropping your coverage if you get too sick. will give you the security of kning that if you lose your job, i you move, orf you change your j, you'll still be able to have coverage. it will limit the amount your insurance company can forcyou to pay for your medical sts t of your own pocket and it wi coverpreventative care like checkups and mammograms that save liv and money. now, i you don't have health insurae, orou're a sma busiss looking to cover your employees, you'll be ableo choose a quality, fordable health plan through a alth

insurance exchan, a rketplace that protes choice and competition. finally,no insurance comny will be allowed to deny y coverage becausef a prexisting medical condition. we're now seeing broad agreement thanks to the workthat has been done over e last few days. so even though we still have a few sues to work out,hat's remarkab at this point is not how far we have left t go, it's how far we hav already come. i understa how ey it i for this town to beme consumed in e game of politics, to tn every issue into a running tally of who's upnd who down. i've heard one rublican strategist told s party that even thougthey may want to coromise, it'setter politics to go for the kil another republican senator said that defeang health care form is about breing me. so let me be clear this suspect about me. i have great health insurance and so does ery member of congre. this debates about the letters i read when i sit in t oval officeveryday and thestories i hear at tow hall meetings.

if somebody told youhat there is a plan out there that i aranteed to double you health care costs over the next ten yes, that's guaranteedo result in more america losing their hlthcare and th is by far the biggest contrutor to our federal deficit, ihink most people would be oosed to that. well, at's the status quo. that's what we he right now. so if we don't change, we n't expect a differentresult. and that's why i think this is so impoant not onlyor those families out there whore struggling and whoeed some protection from abess in the insurance industryrneed se protection from yrocketing costs,ut it's also important for our economy and, by the w, 's important for families' wageand incomes. one of the tngs that dsn't getalked about is the fact thathen premiums a going u

anthe costs to employers are going up, that's ney that could be gng into people's wages and incomes. d over the last decade, basically saw middle-class families, their incomes and wages flatined. part of the reas is because health carcosts are gobblin th up. chuck dd? >> thanks. we were just tking in tt question about reducing the health car inflation, reducing costs. can you explain how you'regoing expandoverage? is it fairo say... is this bill going tocover all47 llion americans that are uninsured or ithis going to be something... is it going to take amandate or is this something that isn't... your bill is probablyot going to get iall the way there and if it's not going to g all the way there can you say how far isnough? ok, 0 mlion more, i can sig that. 10 million more, i can't. >> i want to cover everybody. now, the truth is that unless

you have a... what's caed a sing payer system in which everody's automatically vered, then you'rerobably not going to reach every single individual bause there's always going to be someby out there who inks they're indestruible and doesn't want to get health care, doesn't ther getting health care, and th uortunately when they get hit by a s end up the emergency room andhe rest of us have to pa for it. buthat's not the overwhelming majority of americans. the overelming majority of americans want healt re but millions of theman't afford it. so the plan that s been... that i've porward and tha at we're seeing in congress would cover the estimatesre at let 97% to 98% of amerans. there might stille people left out ther who evenhough there's an indivual mandate, even though they are require to puhase health insuranc might still not get i.

or despite aot of subsidies are stilin such de straits that it's still rd for themo afford it and we may endup ving them some sort of hardshipxemption. but... i'm sry. go ahead. so i think that the basic idea should be that in this country you want health care u shoulde able to g affordable health care. and given the wastehat's alrey in the systemight now, we just redesn certain elemen of health care then capay for it. we can pay for h in the short term but we caalso pay for it in the long term. and, ifact, the's going to be a whole lot of savings that we obtain from that because for example the average american mily is paying thousands of dollars hidden costs in their insurance preums to y for what called uncompensed care: people whohow up at e emergency roo because they don't ve a primarycare

physician. we can get those people insuredand instead of ving a foot amputation beuse of advaed diabetes they're getting a nutritionist who's working with them to ke sure that they arkeeping their diet where it needs to be, that's going to save us all money i the long term. jake? >> thank you, mr. president. you said eaier that you wanted to tell the amecan people what's in itor them,ow will their famy benefit from health care reform. but experts y that in addition to the benits that you're push there is going to ha to be sacrifice in oer for there to be true cost cutti measus such a americans giving up tests, referrals, choice, end-of-lifcare. when y describe health car reform, you don't... derstandably you don't talk

about the sacrifices that americans mit have to make. do you think... do youccept the premise that other an some tax ireases on the wealthiest americans, t american people are going to have to give anythingp in order for this to happen? >> they' going to haveto give up paying for things that don't make them healthier. and i... speaking as an american i think that's the kd of change you want. look, if right now hospital and doctors aren't cooinating enough to haveou just take one test whe you come in because of an illness but insteahaving you take o test then you go another-to-anotherpecialist you ta a second test, then you go to another specialist you take third test and nobody's bothering to send the first tes that you took-- same test-- to the next doctors, youe wasting money. you may not see it becausef you have healt insurance rit now, it's just being sent to the insurance company.

but that's raisi your premiums. it's raising everybody's premiums. and that money one way or another is comingut of you pocket. alough we are also suidizing me ofhat because there are x brea for health care. so not only is it costin you money in terms of higher premiums, it's al costing you as a taxpayer. now, i want to change that. every ameran should want to change that. why would we want to pay for things that don't work, that aren't making us heahier? d here's what i'm confident about. ifoctorsnd patients have the best information about what works andhat doesn't then they're gointo want to p for what works. if there's ue pill and this a red pill and the blue pl is half the price of the red pill and works just as well, why not pay halfrice for the thing

that's goi to make you wel buthe system right n doesn't incentivize that. those are th changes that are going to be needed...hate're gointo need to make inside the system. it will requei think patients to-- as well as ctors, as well as hospitals-- to be more discriminang consumers. but i think that's a good thing, because ultately we can't afford this. we just can't aord what we're doing right now. >> rose: we continue o conversati about health care reform by talking to o of the principa shapers in the white house. he's peter orszag, the office o managent and budget. peter orszag ha taken an incrsingly prominent role o health care issue th"new yorker" magazine has written that he is progr the domina voice on health care within the white house. rlier today, i recorded a conversation about health ce

an the economy. the economy poion of that inrview will be seen ler. tonight, t health care partf a conversation with peter orszag. let me ju starty what you think this debate is at a crital stage and what you think the debe ought to be about. >> well, it is at a critic stage. it's no rprise. i mean,q broad scal health form hasn't happenedn 5 years. i think the debate really needs to be about whether we are going to not only expand covage but perhaps if not moreimportantly transforthe health care system sohatt's digitized, so that it's evaluating what's wking and what's not, and so that we are changing the incentives built into the current system away from more ce, which is the way they're rrently oriented. and towards better care, which

is wt what we need to do. >> rose: what you think a thmore critical elemes of e plan. >> on that demention and we can talk about other mentions-- on our fiscal trajectory, i think the key thing is t legislation s to be deficit neral using ha,coreable offss and sings scored by thecongressional budgetffice, for example, so that its st is fully fset and weput on the table500 to600 billion in medicare and medicai savings and then there's an adtional revenue piece at will liky beart of any final package. in addion to that-- this is sort of belt-and-suspenders approach-- so at wor deficit neutral and then we need to talk the steps that trsform the health care system. health i.t., comparative effectiveness research and importantly, a b propos that we've put on e table, a change in the way medicare policyis set so that we move more decision ming out of theands ofoliticians.... >>ose: away from coness into the executive anch? >> well, io what wre caed

the mack, independent medicare advisory council. and that's important because health care rkets are dynamic, and ts imack body would help us take into account new infoation and orient towards quality, which is a key part of what wneed to do. >> rose: the next guest on this program makes thatery point in tes ofuality of service at an effective means what's happenedn your own analysis to make the cost of dical care so onerous? >> well, there are a variety of things that are happening. anthe way i like to think about its we have this huge variation howealth cars practiceacross the united states. even here inew york if u look at n.y.u.medical veus columbia presbyterian versus other hospitals in the city, let alone those hospitalselative to mass general or stamford,

there are dramatic fferences. so for example at n.y.u. medical last sñr months of life on average medicare benefiaries are spending 31 days in the hospital at n.y. medical, only 1 days at so fordedical. rose: why is there a difference? >> i think variation is greatest whene have least... the least idea as to what should happen. so there's nothat much variation in... i don'tnow, in adminiering an aspirin or be blocker when somne is admitted to t hospital with a heart tack. a lot more variation in h we eat back pain ornee pain or whatave you. we ao have a paynt system that wl acmmodate or facitate just doing mor rather than doing wt's best. who wod want to spend more time in the hospital than was necessary? who would want to ha a unnest tests donef they're not imoving the outcomeand then the question is how youet at at. >> rose: go ead. >> ithink the wa you get a at is health i.t. so that you

can really srt msuring and having the da necessary to observe much more precisely what is happeni and also what the result is. a structure in place t be evaluating what wos and what doesn't so that have much more infmation aut eective care. and th financial inctives for quality rather an for volume. and the problem in tt final category is in most cases we don't know exactly how to design those fincial incentives yet. what wre saying i it clear directiolly what we need to do. we need to pay for value. >> rose: right. >> the problem is.... >> rose: we don't kw how to t there. >> iean people say pay for value, pay for performance. there are lots of promisi pilot projects going on. threason we have put forward this ima proposal is we think that's a more promising way to move to the future syst that rewards lue rather than thinking you c just write down the full thing today and be done with it. i think that's unrlistic. know directionally wha we

need to do, we have many promising ids but this is going take time and effort and a continual application incomingnformation to me the. >> rose: so now it's what, yesterday, or the d before? >> well, the's been on going work. it hasts intellectual predecessors that ha been floating around for yes and that i reflected in the existinged pk which aeady provides recommendations ofhis ilk to the congress. it's not a brand new idea, but in terms of administration-specic pposal yes weut it forward formally on last friday. >> rose: i there now in the political dynamican effort b the president, t press conference andverything else and all these interviews to say "we realize this is not goi exactly the way we want to and so we' going to full court press"? >> the w i would put it is this is a verymportant sector of the economy. it has portant implations fo hoeholdsnd state governmes and all of us.

and, aga, there a reason this hasn'happened in 50 years. th is hard to do. buif you look at the alignment of fors and ok at the progress thahas been made, it's quite significa. so, you know, was it ever going to be the case that you just epped forwardnd said "hey, t's reform health care" and be done with it no. rt of the legislive process is going through. is warranted the paiul steps of moving through committee, addressing concerns as they come up. and that's tural. especially osomething this important. rose: what's on theable for negotiation with conservative decrats? >>ell, i think the things th are under discussion include-- and this is someing the president had spoken about-- incle weather there are changethat could be made to very high st private iurance anin particular t incentives to offer very high cost private insuranc. again,his proposal tha we've put on the tle is unde

discussion. and theni'd say tho are more in the sor of long-term cost containment cegory. in addition to that, there's the making sure over t next decade the package is dicit-neutral anexactly how you do that. so there are ongoing discussions between medicare savingsnd revenue, exact forms of revenue and what havyou. >>ose: is therevenue nowet for a couple earning more tha $350,000 a yr? their taxes wil be up around 55%? >> no. there are differen proposals floating aroun let me bac up again. we hav said that the prosal, addition to beginning the painful annecessary ocess of transforng the health care stem, has to be deficit-neutral. we've put on thetable $500o $600 billi of medicare and medicaid savings. the reminder, any additional cost of the program abe $500 to $600 will have to be me through venue. and we have put forward a

proposal that we think makes a lot ofense to limit itemized deductions. >> rose: right. >>heenate finance committee is considering oth approach. the hoe of representatives is considerinyet other approaches so the figure you're mentioning refer something that' under discussionn the house. but that's only o of many. and i'd also note,ust on the numbers themselves, those figures refer ta tax situation where you include state and local taxes. and that's already t case for many famies that their tax rates are higher tn many peopleould expect including state and local govnment revenue. d the second thing is i applies to a very small shareof families. again, this is just... t key thing ishe plan h to be deficineutral. ere are different revenue proposals under dcussion and that's jt one of many th are under discsion. >> re: what is it you think is the most glaring misconception about wh theadministration wants to do in heth care reform >> that's a great question. d say there have been a couple

things that have been off relave to the underlying sutance of what we'retrying to do. think there's bn too much attention. not too much attention, there's been... it's a natural media yah phenenon too to criticism and not asking the question, oy, what else could be done. because the conclusion is we're doing everythi that cowl possibly be done d people are still complaining, that's different than sayg ", this is no good and the tenor of much of the coverage, eecially on cost coainment in the long ter i think has often played up the criticism without aski the estion, okay, what else would you do? and one the reasons-- the president has already spoken about this one ofhe reasons we had a meeting in the ol' office o monday with thc.b.o. director and other outsiders is precisy to say "okay, what else can we do?" and i think we've covered the terfront. >> ros what do you make of the argument that they somehow-- and some republicans have said

this-- you ought to spur competition among the ivate insurers and tn we'll reduce costs that way? >> well,one of theeasons to ve anxchange and onef the reass also to have a public option is.... rose: to createompetition. >> to create competition. and this has gotten t little attentn in the debate. if youook at lol insurance markets, a gwing share of them ve now beme excessively concentrated. so if you look at traditional indexefor a market that is not fully competive, amatically increased share of local insuran markets are now ov that threshold in terms of only having two or three priders that have a disprortionate share of the market. and the evince suggests that does increase premiums. so one of the goals of having exchangend also apublic tion is preciselyr?z introduce competition into tse local insurance markets wre there is inadeqte competition currently and, frankly, less competition than was the case 0 years ago. >> rose: a what do you say to thoswho worry that the puic

tion will just grow and grow and grow? >> well, a lot of that's going to depend on specifics of the proposs. i would note, r example, that the congressional budget office--hich many of thos critics li to refer to in other contts-- has sgested th enrollment i theublic plan would only be 1 to 15 million people. >> rose: howuch in reality of medical care is funded by t vernment already? >> about half. >> rose: you lookt medica and medicaid. about half. it depends exactly how you do the callations but sewhere between 40% and 60%. >> rose: a what do you think the judgment of the effectiveness of those programs-- medicare d mecaid-- is? well, i can answer tha in a uple different ways. they certainlyelp the people who are insuredrelative to ving no insurance. >> rose: exactly. >>without question. anthere is evideeuggesting having health insurance does help. i mean, therere lots ofor attribut or inputs into yo

health >> rose: because many argue that they worry that e public opon will become li medicare. >> well,.. >> rose: i its application. >> in its applicati. and what i would say is medare has to mo to medicare 2.0 regardless and if we g to medicare.0, there' less concern about whethea publicplan becomes like medicare. regardless of what hpens with the public plan, medicare nds to move towards the types of things that we're talkingabout: higher qualit providing incentives f better care and what i find striking again is ere are gat emples that already exist within the united states of how to do this. anif the eire countr were like those providers, we wou all be a lot better off. >> rose: this somedy like the mayo clinic or somody like hawaii or somebody lik those five states that a often mentiod as examples o how systems work >> there are aot of examples. mayo clinic, clevelan clinic,

intermountain health, there e a whole variety of systems tt are ing a lot better than others on this cost quality combation. >> rose: mayo clinic said yesterday they're not happy with the plan. >> they saidhey weren't happy th the plan but then theyame out with a statementthat saying themac proposal is precisely the kind of thg that will help fix the plan. >> rose: because they don't thinkongressional control wit mething like medicare is a good idea. >> well, no. they've said putting more weight onedicalrofessionals and othe would be a better idea. >> rose:etter idea, exactly, thanongress. there iso doubt in your mind th the oma health care reform wilot experience what happened to the clintonealth care reform program? >> i don't tnk so. i think time.... >> rose: and how do you kno you've learned the lesson? >>ell, i think the are a few very heful signs. first, the alignment of outde forces is much diffent.ñi

you have major providers and major grps behind the reform effo instead of running adverting against it. the presiden has avoided the potential mistake of... lete put it this way. the president cognizes that we imdiate to..this is a collaborate process with the congress a there's give and take on bothñi sides and if we t % or 90% of what we want, that's success. i think th best way to get at it is not to have such strong incentives always to beoing more stuff even if it doesn't help. so, again, i'm going toust say none of us would want either ourselves or our family membe topend days in the hospital that are unnecessary. or to have test done that are unnecessary. i'll give you an example. 20% of medicare beneficiarie are readmitted to the hospital within a mth of being diharged. and whoould want too back into the hospital it's not necessary? there are hospal systemshat have desned ways of reducing

readmiion rates and then concluded that ty couldn't affo to continue those practices because itas fincially disadvantageous for them to do so. that makes no sense we need to creat stronger incentivesor the quality care which will avoid avoiding unnecessarreadmission. >> rose: this one las question which i'dçó forgot about in ters of health care. a lot of republicans and conservative demrats are ising questions about the burden onmall business. >>ell, a couple things first, the bill wld... any bill that emerg from this ocess is going to include important this for sma businesses. ability to purchase higher quality lor costare through an exchange that's typically difficult r them to do. tax credits, which will help them offset anydditional cos ofeeting insurance coverage. bui thinkne of the things we have to realize as you me from small businessesinto

medium and larger businesses, we have to protect against fms ju saying, yo know what? there's is publicly subsidized exchange, we're going to drop our coverage and put everyo in there. the mivation behind many of the so-called pay or play provisio is precise to oid that kind of behavior. >> rose: did you learn anything abouhealth care you didn't know wheyou took thisjob? i'm learnin lots of things about the inicateesign of specific medare policies. because at t congressional budget office youave respsibility for broad scale estions. in the ainistration, there are lots of nitty-gritty detai th don't move through the legislative process at now come across my desk. >> rose: and it's often speculed even by one republican cgressman who said this may be esident obama's waterloo. >> yh, i think the president said this isn't about him, this is abo getting an important rerm done and that's what

we're focused on. >> ros it is said, i think in the "new york times,on your desk the's a copy of teddy rooselt's book "the strengths you life >>es, there are. >> rose: and another book by a greek historic philosopher. >> yes. up? why ose two? >> thegreek stoic philosopher had the persptive thathat is most iortant is h werespond to external events and i think that's thenly thing we can truly gorn and i think there's deep tth in that observation. and pecially jobs lik this it's iortant to remind onese of tt. teddy roosevelt braced a life philosophy that very mu want to seek, which is at the purpose life is to go out and be vigorous and be trying ings and not only seeking comfo. >> ros he decided the kind of person he wanted to be and he became thaperson. >> that's exactly right. so i think all ofs hope that can, in fact, accomplish that kind of transformation.

sbhuis yourquivalent to being aowboy? (laughs) i nt to be a gd dadnd i want to be a dedicated public servant and want to continu to learn throuout life. >> rose: thank you for coming. >> thank you for havinge. >> ros back in aoment, stay with us. >> ros we conclude this look at healthñr care reform withñi s cortese, he's the presidt and c.e.o. of e mayo inic rocheste minnesota. it providesedical care at per-patient cost that falls well belothe national averageand has a a reputation foralue. for this reason, many experts point to mo as a model for morefficient natnal health careystem. i'm pleased to have deniscorps seize at this ble for the first time to talk about the may owexperience and how he sees health care refm as it works

its way through congrs coming from the president's own plan. welcome. >>hank you, charlie. pleasure to here. >> rose: is ything different about the debate? where do you think t debateis ing from previs debes about health carereform? >> it'sn interesng question. there are elements of the debate i think that we currely are seeing that e not a lo different than before. the fdamental difference, however,hough, which we ar trying to bring more attention is... falls in maybe o categories. first, everybody knows we have to do mething. and the main reason erybody knows we have to d somethi is that i thinkhere's a... an agreed-upon shared reality that the country is not getting what it pays for. we're not gettinghe tcomes. we're not geing the saty. we're not geing the service. we don have the cess. and we're putting a lot of money into it. and with t work of mmonwealth fund and all other organizations over theast few years who have highlhted those

diffences, we're now begning to say,hey,we have a shared we alty, have to do more. in aition, though, there's another factorthere and tt is wee beginning to come to grips with the fact that we have a problem with t syem of health carin the united states. i hear me people say the system is broken. and you've hrd me say this before, but one o the problems with sayg the system is broken is we begin to think that we n fix it. we actually think thers something can do-- tweak he tweak here-- d fix it when, ined, the problem is we don't have a health ce system. there'never been one designed, nobody h consciously said "what do we really want out of health care?" we've nevesat down to design a system because iwe've had, as yove heard me say, where are the system eineers who signed it so we can ame them for where are today. the isn't one. nobody'sver designed it so frankly, though, tha thought

is powerfully lerating. because it says if w reali we don't have aystem maybe can sit back and design one and sit down and say "what do we reall wa out of health care?" and when i hear people say-- and i' spoken with many pple arnd the country--hat we're not tting what we pay for. i sa "well, what is it that you really want?" and we begin to hear tngs like well our safety isot really good, we have disproptionate access. a whollist of things. d i say what you're saying is you're not getng the ocomes, th safety or the svice, you' saying "we're not getting high-value care." vae meaning a mathetical equation of the outcomes, safety and service all in the top, the numerator divided b the amount of dollarse spendver time. so i say well, then y don't we define value and let's sortof pay for it. so then the xt dcussion starts andeople saywhat do you meany value?" and i say let's lk at this

century anday what can we rely do for individuals? vaes should be oriend around what'smportant to people, what's imptant to individuals. anlet's now design a system around the concept. and one way to do that would be to say to folks "who would like to be hoitalized tomorrow even if it's theest hospital inhe world?" i've asked this question many, many tes in many, many talks. rose: everybody says no. >> erybody says no. so that starts me thinking well, ifember wants to be in the hospital, why aree desning or thinking about systems that are oriented aund hospitals spitals are a symbol of maybe the failure o a system o the ture, not the center of the unerse. >> rose: ectly. >> seconquestion, we canay ll, okay, ifou don't wanto be in a hospital, who would like to be sick tomorrow? well, not ma hands gop. nobo actually wan to be sick. i say, okay, then, why might w design something thas around taking care of sickness? we do ed to takecare of sickss but we can now in this century begin to design things

r a future ste where we're trying to work to keep people healthy, keep em out of t hoital, keep them ou of the doctor's offices, keep them nctionings and healthy as we go forward. >> rose: let me go to specifi questions because i he you th what the appach that ought to be taken. were there conusions you came out of mayo cliniith beyond whatou just said in terms of when we lookt the fact we need to design a new system or is there something se to add to the nclusions that you reached? >> the conclusions that came out of the fourears we were working ll into four cagories. one is tt we want vue out of the system. >> rose: right. >> two, we should pay for vue so we get that value out of the system. the thd is everybody should have iurance. and e fourth isthat we should... to ta do allf that you need toave intrated and coordinated care that's tailored around the individual. those areur four pillars. >> rose: question. do the prosals put forth by this admistration in their health refm... health care reform efforts meet those four

criteria >> there aremany propols out there, so if you look the house bill andthe work that's going on inhe hou, the work that's going on inthe senate, and the rk that's going on in the ministration itself. when you look at all of the componts that ar in everywhere thehings i'm talking about are there. it'sust that they are not pulled togetr. the funding mechanism isn issue, of course. politics has to deal wh it. but in our opinion the idea of fundamental change in heal care reform we absolutely support. we applaud whathe president is dog. he's calling the qstion. i understand people e having difficulty figing out the details, but hs calling t questi that'sxactly right. >> rose: what do you think of the plic option? >> the public opon in thelan depends on wha we mean the public option.

if we mea a medicare type option tt h price contrs and it's fee-for-serce, that will be a catastrop.x we've seen it already in medicare it's the largest public insurance company. it's been up and running for manyears. it's had price controls uer its contro for... since 1983 and with priceontrols, what are wex seeing? people just do more. the rate ofxd grth of spending has still again up. rose: so you getaid for every serve, you want todo as many services as y can. >> and, remeer, medare is only one style. anotr one could be medicaid. they have difficulty?i it. you've got a milary system. you've got have system. you have tricare. trare isçó a pretty good little choice produ out there. people who have it ke it, most ople don't even know what it is d not many folks have askedo ar from the tricare adnistration what they can do. what can the bring to the table. and you ha the federal employees health ce plan which isasically private insurance products tt's available for all the federaemployees,

including the congressmen and the presidt, the mail carriers the c.a. agents, everybody. >> rose: this is the reason people aays say if congress would give the american plic e same kind of health care syst they ha,hey'd be betterff." >> well, and indeed, when you look at this a you say well, okay, have six public plans that arevailable on the shelf and i hear ople saying we ought to create a new one i say what are they out of theirind? it make me cnge to think of reallyeing able to put together another plic plan. welready have some. pickne if we want t use that so the ia of the public plan is fe. but the fundamental issue is not much how we get everybody i sured. ulmately, we will get more and more people insured, maybe all of them, le massachetts has done. the fundamental problem we will run into is, just like massachusetts has run into, the livery system.

how do weet valueut of the delivery stem if it's too expensive the way we care for people? getting a lot ofeople insured isn't going to help that. if it' too unsafe, getting more people insured in anunsafe system doesn't solve a problem. because i know lot of pple whget bad care even thoug th're insured. so insurance doesn't solve the realroblem. the yfundamental issue in health care refm will be reforminthe delivery system s it provides high valu now we'll come back to your qution. the ic proposal-- which we became aware of on monday. it wasosted friday but i was traveling a lot and didn get back into myffice. i didn'tee it until monda rning. when saw that, really struckrue that peter orsza and sikh emmanuel must have be involved in ts. i know both ofhem, we talk a lot abou this and know those two t it. they know what really needs to be de. and this ability to definvalue

mease it, reward it, figure out ways to run pilots on how to pay fo it has toe moved out of thecongressional oversight. becauscongress is... their job is torepresent people. they're busy ery single day. they we not selted to be a board of directors of insurance company. that's not tir job to try to run an insurance cpany. you need a qui-independent body that ould report to congress but can focus o value defining it anhow do we pay for it, ve them three to five years to ge everything in place for what we need to do. gi a warning to t whole delive system because as soon as you warn them, they'll sta to selfrganize, to get where they need to be. and you begin the process and even to make it easier y can salet's fos on the top thr or five condions that are t most expensive in medice. and when you do that, you're going to be covering aut 60% to 70% of all th spending that we have many medicare. so the proposal. i like the proposal. thdetails will make dierence.

>> rose:here acommon denominator why ere is a regional differee in terms of effeive health care? >> i'l try to put in the one word. i think it hasto do with culture. culture of the physician. ultimately if i ve to put in the one wordt's the ideaf e culture. you can look at certain regions of the countrynd find totly different styles of practices in the same state with people who are separated by00 or 300 miles. there ju seems to be a difference. wh you look in colorado and grand junction, there's no rea integrated gup practices. butheoctors there-- i don't know how it's happened-- work in a y that that concentra on the physicians, they hav a way to distribut informatn and they try very hard to ep thin as coordinated as they can. by doing that, youget better results. inner mounta clinic utah. th have an insurance product, they are an insance plan wit hospital and dtors, someof the doctors are on lary, about

half of them are more like i e regular fee-for-service type environment. but they work togher in a am approach to get better resul. >> rose: you have said befe-- ani want to make sure i undersnd this when i'm listening to you live or whe i've read at you said-- that you thk that theeform program soar has spent to ch time talking about cost and not enough tim talking about quality. >> exactly. ere's no question aboutt. the twoo together and when you relate them togetr you're talking value. quality rsus the cost. and th leslature and other are ry worried about the cost. quity and... the quity is the delery system respsibility. and the point i you'vgot to do both together. >> rose: have you... mayo clinic said yesterda reported in this morning's newapers they don't like the proposal they say, the health care refm proposals so far. my qstion is have you had real

acss in washingt to th ople who are creating alth care rorm to express as much as you wand to and as long you wanted toand as car as you wand tohese ideas? >> the firpart of your question is yes i've hadccess. the secondart of your question is havi had enoug time to discuss it is very complicated, the answer is no. not to the policymaks. i'm involv in the institute of medicine and other areas so we have a lot of cnces. >> rose: why not? >> don't know. (laughs) >> rose: but, i an, isn't this the... th adnistration, it is being said, that this a huge te. it's t first big te of the administration. >> right. rose: dn the line, inour judgment, with you, whyaren't they with you on the points? >> lobbying. >> rose: explain. >> political pressure. theye in the hot seat and they have political presre. what i am talkingabout is long-term vision. it's a vision of where weneed

to bento the future. and what w need to expect. i understand wecan't get there one lump sum or one year or five years, ten years. this cld be aone year, ree year, a five-year plan. this is e way we think inmayo clinic. we begin tohink with what is the shared visi where we want to be? ere do weeally want to be? and that'shat we're fighting for now, we... whatever dision th country makes,ayo clinic is going t support it. we're going to go ahead. we also function in our own organizationnd while we're eating the shared vion that we get our say. everybody talks; everybo listens. we hear, we modify,e try to come torips with it, we create the vision and once weave the vision, okay, that's where we wa to work towards. our goal is to be partipated in the shared vion discussion, that's why m here todayith you. the simultaneous dcussion, though, which is fquently the harder one is toome torips with what is the shad realy in thi country. d too many people don't want to honestly say what the shared reality is in the country.

and what is actually ppening inhe country? hoare we takingare of people? are we focing on people? are patients the center of a our design? do we ve those three queions i ask about do youant to be hospitized? do you wanto be sick? do you ever want to be a tient even do we have that the back of oumind as we develophe future? if the shared rlity says no we don't, then we have a shared ality and a shared vision and al we've got to do is fl in the gap. and the gap can be filled in with a plan that says inone year we'll be here, fiveears we'll be here, n years 'll be here. that's the way we function in our business a other businesses congss can't do that and that's why we are a p proponent this idea of let's gethe health care stuff ou of congress. >> rose: that's the imac? >> sometng like that. im or something like this. we're not the onlyroups talking about th. the blueidge group-- not the blue ds-- buthelue ridge grouare talking about that and even thelue dogs are starting to talk abouthat.

so how do we move it over and have an organizaon that we hold aountable to move us progssively toward a shared future. >>ose: let me turn to how do you pay r this? as younow, they wand this to beeficit neual, the health care refm. right. >> rose: as you kno, there are a series of proposals o there. they believe thatprevention will provide savings. they believe that... >> long-term >> rose: over th next ten years. >> great. >> rose: they also belie that part oit has to com from revenue. doou support allof that? >> the answer yes. again, in the long-term sion.... >> rose:nd is it neal have. >> the longterm return on investment by creating some... pulling me levers that will have the delivery system self-organized for better value isreal. this has been shownn many different places. the cost of providing services for medicare patients in miami is about $1,000 peryear per person. the cost of providing services

with the same outcomes-- maybe even little bter in haii-- is $5,500. so sehow in there there's som savings, somehow that we have to be able to find by getting more efficient in the way we careor people. that's number o. the othereality is, it will cost more to get people insured in the short term until later you start to rea the rewards of people not ending up i hospitals, not ending up in doctor offices. thats along-term invesent. thc.b.o. can't sce that stuff, i understand that. the short terms the reality. so then we say, oy, how do we actually fund it? and, frankly, from moclinic's persctive and our health policy persctive, the proposal that riden submitted a while ago, which was.. >> rose: t widen/bennett? the widen/bennett bil and ibelieve en max baucus would like to e something along th lines where we have some equalization of tax deductibleability of purchasing for health insurance. either getid of it, extend it

r both, cap it but do sothing about it. i ink that's a fundamental important step that h to be made. we have to tax more people some more money, wdo that, too. is is a political issue on how to pay for it. but we have to pay forit in a system tt we're resigning or wel never get that return th investment. that's why think we have toe focused on both. this is the time t make a statement about inrance for everyby and going for value at the same te. massachusetts s shown it. >>ose: and we nee both. >> and we nd both and ssachusetts has proven it. >> rose: mandated insurance. >> they've mandated insurance but now we are two o three years later, they've got ny more people insed, 98% or more. now they're coming to gripsith the fact that delivery sysm is not as efficient and effective as they need it. w they'retalking about bundled paents, different ways to pay, cetera. so we have that eeriment in our hand we have to try toearn from that by tkling both of these, n in the se year but in theame set of bills.

thbills that come out and get passed, iould like to see it be a visiona statement for where heth care wille five years ar from now or ten years from now. everybody insured and we're getting high-value care. one we can dosooner than the other t we've got to be focung on th. >> ros because i haven spoken to it, this idea of the last year of costing so much what's the answer to that? >> i thinkhat that pnomenon is a functi of what we call in th medical field a others call, too, utilization. what doethat mean? homuch do we do to pele? any time iur practice whenwe look at theare for people in a certain time fre, if it's the end of life it's earlier in their life w find a system phenomenon. the me types of provirs do less to peoplend get better

outcomes. th translates to ler cost. >> rose: the same typ of people do less... >> same grou are providing.. the folks th are getting les expensivdelivery of careto peop in their end life, what thoseroviders are doing is they're getting satisfied patientsho have. those providers have interacted with their families, talked to tm about e pros and cons of what needs to be done and at many times as a physician,any times you have to come a point that you really have topractice t t of medicine d stop doing things for people t keep tm comfortable. keep them as viable as they can at home with their family,ith their friends. as much as u can and find ways to do tt. that's n the same thing a saying they should bin the hospital longer in i.u.'s longer, that's n the same statent. the areas of the country tt get lower cost at the end

life do it by ending up having done fewer tests, fewer office visits, fewer days in the hospital, fer i.u. daysfor instance. they dot, i think, becse they know tir patients,hat i ear wi them, there integrated, they're coordinat, there's more interactivity there. weeed to infeuds more of that back. in t whole delivery system for everody, not just the end-of-life care, it the whole thing. so those provide that are lower expense pviders, lower utilizers at the end-of-life for patients, part of the same ones that perform welln those oer age bracketstoo, becau the nature of their practice is a little more integrated, coordinated, focusedn the patient,interacting with the tient, takg the patient's sires in mind. >> rose: in your best dgment, do you believe we'l get the health careeform weeed? >> well, i have to. it may not be this ye, but it will be before 2015 or 2017 because medicare will bankrupt the country. what i'm doing righ now at the

end ofy career, i've stopp practicing, i'm lking about this sff,t's all abouty grandchildren. this isn't about m not about obama, not about bcus, not about chlie rose, it'sot abouanything els other than what is best forpeople over time. anit will probably be the ople behind that we've got to do thisfor. because i n't think we'll get this done the xt two or the years. but we'll never get it do if we don't cle vision of where we wanto be in five, sen, or ten yes. >> rose: so we've got to start redesigning the system today >> that's at i'masking for and recognizing can onlyite off certain chus at a time. and i recognize that. but i' looking for.... >> rose: so what don'te bite off w? >> no, what i'm saying is w bite o int insuranceor everybody now. let's get goinwith that. that's wt we're doing. rit now say wee going to go for high valu care. if t government d just those two things, the delivery system over time will begin to self-organiz become aearning ganization where people are interacting with each other whether it's locally, regiolly

or nationally. there are exales of national networks thaare building up right now. patrick wn shone has developed one in connectivity that could be a huge valuable grid r the country. therare many exples if we could just tap them and say, hey, if you do this and you create value, there are rewds at thend of doing at. >> rose: thank you for ming. >> thank you vy much. >> rose: pleasure have you here. >> you're ally welcome. i enjoyed this. >> rose: thank y. thank you fo joining us. see you next te. captioning sponsor by rose comnications captioned by media access gro at wgbh acce.wgbh.org