have a job or not. it forces the private insurance companies to compete. and i think that's good. and they can't keep treating their consumers like that if there's another option. that's the purpose of the public plan. >> rose: is the public plan a problem for you? the public option? >> first of all, i'm for reform. it important for you to know. we'll both get pigeon holed a little bit overall. and i think one of the good things in all the obama bills is reform of the insurance industry. i think it's one of the most positive things and that is to eliminate cherry picking. to eliminate if people lose their job being thrown off in the roles to the vultures out there. so guaranteed issue, pre-existing illness, all that kind of reform is good stuff. and it's in these bills. the problem is you've got all this other stuff in the bill. so the insurance has to be reform. i automatically agree. the public plan boils down to this. i didn't do in the 2003, a $400 billion bill for prescription

drugs and all and we didn't need a public plan. we did have a public plan as a backup if you could not regulate the insurance market and it ended up there were plans for all 40 million people. thus what i would do if i were the senate-- and i think the senate can write a good bill cans is say yes, you may need a public plan as a backup if the private sector doesn't work. that public plan can be three kinds. it can be the nationalized sort of single payer medicare like plan. the american people probably aren't going to take that, but some people will like it and the house will probably pass that. a state-run... an administrative type plan or it can be something local which is much more of a collaborative cooperative which is really hot right now in the senate. i think if you get a locally run not a nationalized plan that is a cooperative as a backup, you can have a public plan there. and it can accomplish everything that the democrats or president obama wants. >> i don't think so. i think that's... that approach has been tried in the past and

bill gave an example where he thought it had worked and i do think the health care plan you passed, the drug plan, worked much better than the democrats thought it was going and i give you that. but it also hasn't worked in other areas. what i think is, you know, medicare's pretty popular right now and it works pretty well. why not let people sign up for medicare if they're under 65 years old. why? >> rose: the president constantly refers to that we're not going to... if you want to intain your present system, you can. nothing we're going to do... >> exactly. >> rose: does that get lost in the debate? and the fear of public option is that somehow it means that the way you, a an individual, go about getting medical care will be dramatically different? >> well, that's the insurance company shtick is god knows we're going to have socialized medicine. we've had socialized medicine for 44 years. medicare. >> rose: >> socialized medicine is not medicare. socialized medicine is you own the hospitals, you own the doctors. it's single payer.

the v.a. is. the v.a. is socialized. >> so we've had socialized medicine. >> do you want to go to the v.a. where you're limited in terms of the drugs you have, the prix procedures enough? the v.a. is a great system and the quality compared to when you and i started is unbelievably good. they have electronic health records. >> but why do republicans keep talking about socialized medicine if medicare is not socialized medicine. >> you don't hear me talking about it. >> you don't.. >> but the public plan, i think it's worth thinking about and the house will probably pass it and you're right, grassley and baucus will not because it's not where the american people are. >> i think it where's they are. 7% of them would like the choice including 50% of the republicans. choice is the kekeword. >> why doesn't grassley and max baucus, chairman of the finance committee and the minority member go along with that idea if they think the public is there. >> 72% of the public want the choice. >> rose: why don't they go along with that? >> i'd like to know that myself. >> the public plan is... this is where the republicans are and i've told you where i am.

you have a system out there that gives a lot of tax advantages to the employer-sponsored private health plan. you have 26 million people who are out there who don't have insurance. you set up a public plan, these people can choose from the private or public plan. the problem is the public plan is a nationalized singer payer system. it will pay doctors 20% less than these private people are paying. >> not according to the house. not according to the blue dogs amendment. >> let me finish. >> okay. >> so you're paying hospitals 20% less, hospice 20% less, home care. that's where medicare is today. medicaid is even less than that as we both will agree. and so what happens there, you're offering the same benefits to these people, their choice, for 20% less, really the same thing. now people say that's good because that causes competition. these 160 million people over here who are in employer sponsored plans, the employers are going to say "listen, for a little bit of f ney i can dump my patients out whereof they're getting this choice into this public plan because it's cheaper for me."

and therefore instead of being ten million people, it grows to 20 million people to 30 to 40. the 160 million people out here who have choice in private plans don't have that choice. so once you get stuck in the public plan, you really have no choice. you can't go back. >> that's not so. >> i'm saying... >> that's not so. that's not what the bill says. the bill says... the house bill says you can't get out of your employer-based plan. that's a... you don't have a choice about that. >> unless you're in a small business. >> after five years the whole system goes away. i'm not saying it's going to happen. >> c.b.o. says it's not going to happen. >> c.b.o. says they don't think. but the fear is as you go into this large public plan, the big bad private insurance industry disappears, they get smaller but then when you're in the public plan, everybody is being paid less and with that you're locked into it so you have less choice and there's less innovation and less technology and there's more-- and i'll use the bad word that president obama did--

rationing. >> that is unfair to talk about that. >> i'm saying it's a rational. >> they may be the rationale. we spent more at our g.n.p. than anybody in the world. we're at 17%. canada and britain is 10%. so there's 1770% you can squeeze out. >> i would say 30%. >> secondly, what the bill says and the blue dogs just negotiated is you cannot pay the medicare rate. now it's going to be part of the house bill. you cannot pay doctors medicare rates. >> so you pay them... first of all, medicare is here, private insurance is here, but you can't pay medicare so you pay medicare plus a few percent? >> sure. >> but still you're going to have the flow of people coming into it. probably >> well, it may result i i havig insurance premiums that would go down. which have gone up 2.5 times the inflation. >> i agree. so so maybe it's not bad to have squeezing down. >> is it your hope... >> met me say one more thing.

>> where do you want to go with this? >> let me finish one last thing. every country in the world that has so-called socialized medicine or whatever you want to ca it, you say it's not socialized medicine, okay. every country in the world in the western industrialized world also has private insurance. even in britain which is really socialized medicine, 15% of all the health care dlas are private dollars. so the idea that we're going to squeeze out public insurance is never going to be a choice again i think is wrong. there's no evidence of that what is over. >> but it may go from 100% of employer-sponsnsed market down to 30% with all of that going into the public plan. you say that's good because the public plan has less administration costs. i say it's bad because it's less innovation and less choice. >> i would like to see a public plan co-existing with the private plans. i think the private plans will treat patients better, treat doctors better and if people think the public plan is inefficient, they'll move back into a private plan. >> look, the health insurance industry is not run by a bunch of dumbos.

you may not like them, but they're smart and they can make money any way they can by filling niches. medicare is a one size fits all program. and there are people who don't like it, a lot of people do. so there's going to be other insurance you can get and most people who have medicare have supplemental insurance that pays for pharmaceuticals. >> rose: this may be apparent but if, in fact, all the doctors in america could vote for the kind of health care reform they want, what would they want? doctors? >> it would be... >> there's controversy about that. >> i think it's a good question. i've never answered it. >> and i don't think either one of us know it is answer because i don't think anybody know it is answer. >> i do think... one of the things... and this is where the obama approach, moving towards value is very good. first of all the information technology is great stuff. i think moving towards value instead of volume reimbursement, the more procedures you do, the more medicines you prescribe, the more heart transplants you do, for t more clinic visits you do, the more imaging you do, that's the way our system is,

fee for service. and when things get tight and you don't pay doctors very much, i'm not saying they do it, i know the president got in trouble for implying that, but at the end of the day instead of seeing a patient every two years you can see them twice over that period of time. so we have a... we're a volume driven system today because of fee for service instead of an out come results oriented condition driven system for reimbursement. so we need to reimburse people for value instead of just volume. >> rose: one question about the politics of it. if i understand where you are, you would like to see the democratic party push through and use whatever reconciliation or whatever they need to do, be damned the republicans... >> because i don't think there's >> rose: but damn the republicans, get health care reform as you would like to have it. >> just like medicare. >> rose: just like medicare with a public option and get it passed and that would be the way to go. that's what you would like to see. stop trying to satisfy the republicans with their objections. >> who don't want to be satisfied. >> rose: fair enough. >> if i thought the republicans

were sincere, i wouldn't take this position. >> rose: fair enough. you believe that if, in fact, they do that and go to the country in 2010 and in a congressional election year they'll get, what? killed? >> i think it goes back to with what howard opened with. i think it's fiscal suicide for the united states of america to pass a bill that all of a sudden says we're going to have $1.6 trillion into a system now that is broken without doing anything to control the cost over time. and i think that's what these bills are. i'm for reform. i think a bill will pass, should pass. and i think it needs to do the good things that we've talked about, a value driven outcomes based system that is consumer driven, driven with markets to bend that cost curve instead of the governrnnt squeezing from above. >> rose: should benefits be taxed? >> and a public option as a backup that is locally run and not run by the federal government. >> rose: should benefits be taxed? >> well, the issue there, again for our viewers, is the employer-sponsored a a free ride

that is very regressive. rich people get a huge tax benefit who are working for an employer and the individual markets out there, the millions of people out there who don't get employer-sponsored get no tax advantage whatsoever. we feed to equalize that. so what i do think is that we ought to tax the very rich plans out here and make them a part of wages themselves, whether you pick up $100 billion or $150 billion, take that, have refundable tax credits to empower individual choice in the individual market instead of a nationalized medicare like single payer public plan. >> well, first of all, i think that's very dangerous. that's exactly why i think the obama plan is better than what the republican plan is because that would drive people out of the employer-based system. and i think we probably agree that the employer-based system probably hurts the economy in the long run. but in the short run, most people like the employer-based system and most employers, much to my astonishment, like the employer-based system. i think it's a mistake to drive

them out of the employer-based system. you're afraid they'd leave voluntarily, i'm afraid the government will push them out if we adopt a plan you suggested. whatever we do, we can't do it too fast. this is a country ha doesn't... they say they like more change than they want. and you can't push them too fast. and that's the genius of obama's plan is we will get reform if you have a public option because the american people will choose the rate at which that change takes place by making individual decisions. >> rose: one last question on politics. if there is no public option in the democratic plan, will the left of the democratic party rebel against t e president? >> i hope so because it shouldn't be passed. it's a waste of money. >> rose: in other words, the public optioning... without public option you should not have health care reform. >> you should have insurance reform. there is no health care reform without a public option. the figure is not 1.6. i think c.b.o. scores one bill at $600 billion and one bill at $800 billion. it's a hell of a lot of money. and i don't think you ought to pour $800 billion into the present private health insurance

system. you're just giving more money to the people who screwed it up in the pirs place. if you're going to give americans a real choice and let them choose reform, then it's okay. but if you're not, here's what you ought to do. you ought to pass community rating as bill was talking about, we all agree with that. do the insurance reform. we did this 15 years ago in vermont. >> i agree with that. >> it doesn't cost anything to do with that. >> thank goodness. >> so if you're not going to have a public option, don't pretend you're doing health care reform. that's what presidents of both parties like to do, they like to sign a bill and say they've had a big victory. it isn't going to do anything. do the insurance reform, take the money out of it and call it a day. you've made an improvement in people's lives, we'll do it another day. >> and the president will take that as a victory. >> i'm optimistic, i think we'll pass the bill with the public plan. >> rose: thank you, you have to host the keith olbermann show and i thank you for stopping by. are you going to run for president again? >> i think it's unlikely but never say never in politics and i think senator frist.... >> rose: i was going to ask you

the same question. >> i'm out for good. i'm not running for any elective office, governor or president or cabinet position. i'm out of politics for good. >> but we keel keep working. this is important stuff. >> rose: thank you. i have in front of me howard dean's "prescription for real health care reform, how we can achieve affordable medical care" i suspect some of the ideas in books you have just heard. >> and it's in english. >> rose: thank you for joining us. see you next time. captioning sponsored by rose communications captioned by media access group at wgbh access.wgbh.org