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Health Care Reform Debate Heats Up on Capitol Hill

June 8, 2009 at 6:35 PM EDT
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After President Obama urges Congress to ready a health care reform bill, lawmakers are beginning to ask tough questions on how to overhaul the complex system. Reporters examine the balancing act developing between Congress and the White House.
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JIM LEHRER: And finally tonight, the president kicks off his drive to reform health care. Betty Ann Bowser begins our Health Unit coverage with a report on this weekend’s developments. Our Health Unit is a partnership with the Robert Wood Johnson Foundation.

BETTY ANN BOWSER, NewsHour correspondent: Kathy Meyer does everything she can to stay in shape.

KATHY MEYER: The most important issue is your health. Without your health, you can’t do anything else.

BETTY ANN BOWSER: While the 58-year-old unemployed grandmother has done a good job of taking care of her health, she hasn’t had much luck with controlling her health care costs.

Two years ago, she lost her health insurance when she got divorced. Since then, she’s had one insurance problem after another.

So, over the weekend, Meyer went to an event in Charlottesville, Virginia, sponsored by the former Obama for President campaign.

KRISTEN SZAKOS: This is part of a national day of meetings just like this all over the country, where there are thousands of people, simultaneous with us, all over the country doing this.

BETTY ANN BOWSER: Last year, Kristen Szakos and her husband, Joe, organized people in Charlottesville to vote for candidate Obama. Now they’re using the well-oiled campaign machine to lobby for an issue: health care reform.

KRISTEN SZAKOS: We know that we’re going to have to have a major push, because change has been tried before and it’s failed. And so this time it’s going to have to be different, and I think we’re going to need all of us and all the people that we can talk to…

BETTY ANN BOWSER: All across the country, in living rooms, community centers, diners, and the like, participants were asked to help the president get legislation for affordable, portable health care for all Americans.

KRISTEN SZAKOS: So what I’d like to do right now is watch the video that we have from President Obama.

U.S. PRESIDENT BARACK OBAMA: After decades of rising costs, I believe that real health care reform is finally possible. Today, I’m working to build a diverse coalition to support this effort. And partners have already stepped forward who have never worked together before. But the most important seat at the table belongs to you. To get this done, I need your voice to be part of the debate.

BETTY ANN BOWSER: The video was distributed by the former Obama campaign, which now has morphed into Organizing for America. It’s headquartered at the Democratic National Committee on Capitol Hill in Washington.

ORGANIZING FOR AMERICA WORKER: I mean, I’m really glad to hear that you’re remaining involved now and that you’re looking for solutions.

BETTY ANN BOWSER: Armed with an e-mail list estimated at 13 million, YouTube videos, and text messaging, many of the same people who pounded the pavement for candidate Obama now work for his issues. The immediate focus is health care reform.

Mitch Stewart is director of the effort.

MITCH STEWART, director, Organizing for America: I think our supporters feel like this is our moment, this is our opportunity to really provide something that will have lasting change for, you know, future generations.

BETTY ANN BOWSER: Stewart refused to give any numbers when asked how many of these events were held, but he said there were thousands in all 50 states and that a lot of new people came on board.

KATHY MEYER: The starting deductible is $2,500.

Participants share their stories

Thomass Mann
Brookings Institution
The only time thus far that they've actually tried to put it into operation was on the budget resolution, and all of it was geared towards signing petitions that were then carried physically to the House and the Senate...without any consequence.

BETTY ANN BOWSER: Kathy Meyer certainly fits that description. Mr. Obama is the first Democrat she's voted for in 30 years, and her attendance at the Szakos event was the first time she's ever done anything political.

KRISTEN SZAKOS: How many people have wonderful health insurance that you have no complaint about?

BETTY ANN BOWSER: Like others at Saturday's event, she was asked to tell her story. What happened to her when she tried to buy health insurance and was rated poorly because she had pre-existing conditions, a small skin cancer and a neurological foot problem?

KATHY MEYER: They said my monthly premium would be $1,020 -- I'm going to start crying. So I appealed, and they sent me another letter twisting everything the doctors said. And at the bottom, they said, "If you continue to appeal this, we may delve further into your records and find more information and you may pay more."

KRISTEN SZAKOS: Oh, my god.

KATHY MEYER: So they -- so I ended up with a policy that's $713 a month, and it covers -- I have to meet a $1,500 deductible.

BETTY ANN BOWSER: Social worker Cathy Lawder had a similar story.

CATHY LAWDER: The lack of affordable health care has ruined my life. I had to close my small business because I ended up paying $891 a month for my health care. I had to declare bankruptcy.

BETTY ANN BOWSER: Then participants were asked to break into smaller groups to come up with ideas for a public service project later this month. The hosts for these events followed an outline from Organizing for America headquarters, complete with talking points.

KRISTEN SZAKOS: To reduce rising health care costs...

MITCH STEWART: I think having this face-to-face conversation happening across the country is something that's never happened before. And I think our leaders in Washington are going to take note of that.

THOMAS MANN, Brookings Institution: Yes, it's unprecedented in the scope, in the reach.

BETTY ANN BOWSER: But congressional scholar Thomas Mann of the Brookings Institution thinks the effort won't have much impact on health care reform.

THOMAS MANN: This is a movement and a tool in its infancy. It will take years and years to develop into a potent political force. The only time thus far that they've actually tried to put it into operation was on the budget resolution, and all of it was geared towards signing petitions that were then carried physically to the House and the Senate by all accounts without any consequence.

COMMERCIAL NARRATOR: Before Congress rushes to overall health care, listen to those who already have government-run health care

BETTY ANN BOWSER: Meanwhile, conservatives who are opposed to some of the president's proposals, especially a government-run public insurance plan, are already on television with a series of ads.

COMMERCIAL NARRATOR: Angela French: cost-cutting keeps her waiting for the medication she needs to stay alive.

BETTY ANN BOWSER: As conservatives organize to oppose any liberal health care overhaul, Democrats on the Hill have been working on legislation for weeks.

Over the weekend, reporters obtained a draft of a bill supported by Senator Edward Kennedy, a longtime champion of health care reform. It would require most employers to offer health insurance; provide federal government subsidies to low-income families to buy coverage; and create a government-run public insurance plan.

Meanwhile, Senator Max Baucus, chairman of the Senate Finance Committee, is also drafting legislation.

But Republicans on the Finance Committee today in a letter to the White House -- signed by all but one of them -- told the president he was making a mistake by insisting on a public plan. "The end result," they said, "would be a federal government takeover of our health care system." And they made it clear they would not support him on that issue.

JIM LEHRER: Gwen Ifill picks up the story from there.

New phase in health care reform

Matt Bai
The New York Times
The idea here was to avoid the mistakes that they feel were made in 1993 by President Clinton by not telling Congress how to legislate, how to do their job, by staying back, allowing the congressional committees...to work out the details.

GWEN IFILL: President Obama plans to continue to ramp up his pitch for health care with a visit later this week to Green Bay, Wisconsin.

For a closer look now at the balancing act now developing between Congress and the White House, we turn to two reporters who've been following it closely. Karen Tumulty is national political correspondent for Time magazine, and Matt Bai is the Washington correspondent for the New York Times magazine.

Welcome to you both.

So am I correct in sensing a change in direction for the White House? There was a certain arms-length relationship before with this whole thing, and now the president is himself stepping more into the middle?

MATT BAI, New York Times: I think it's a new phase kicking in, yes. I think the idea here was to avoid the mistakes that they feel were made in 1993 by President Clinton by not telling Congress how to legislate, how to do their job, by staying back, allowing the congressional committees in both chambers to work out the details, to have ownership of the plan, not to say anything that pushes anyone away too soon.

And I think now that it's ramping up, they are starting to wait in a more detailed way, and the first way, of course, was this weekend, President Obama saying, Hey, I'd like to see a public plan, too, that would compete with private insurers.

And I think that going out to the public, making the case is inevitable and something that he's going to have to do if he's going to pass the plan.

GWEN IFILL: So if the president is starting with the public plan, which already has been -- received kind of lukewarm attention from Republicans, where does he go next with that? How is it being received?

KAREN TUMULTY, Time Magazine: Well, one question is, what do you mean by a public plan? Because this could be something very much like Medicare or it could be something that operates like a private insurance company but is actually sort of just financed by the federal government.

What a lot of people don't realize is that there are a lot of states right now that already have public plans that are operating pretty well. So the president has left himself a lot of flexibility in defining that.

The next big change that we've seen from the White House is the question of whether people should be required to buy health insurance. This was something that he actually opposed during his presidential campaign, but now he's saying that he's willing to consider that.

GWEN IFILL: Well, so explain what the individual mandate that Karen's talking about means. Does that mean that people would be penalized if they didn't somehow keep themselves insured?

MATT BAI: Yes, it does. It means you would have a responsibility to buy insurance, as an American, to either get insurance from your employer or to purchase it, and employers would likely have a responsibility to provide insurance to their employees or pay a tax that would go into the system.

As Karen said, you know, President Obama opposed that during the campaign as a way of differentiating his health care plan from Senator Clinton's. Then in the general election, he also opposed taxing employer-based benefits, which was differentiating himself from Senator McCain.

Those are both positions where I think he's likely to have to re-evaluate in the weeks ahead, and he's gotten a favor, in a sense, from Congress by stepping back and letting the committees in the House and Senate get into this, particularly in the Senate, where these issues have arisen.

You know, he gets pushed into a place where he can say, "Well, I'm flexible. I'm a negotiator. I'm willing to abandon these positions," as opposed to having to march out with his own plan and saying, "You know what? All that stuff I said during the campaign, that's not really going to work."

GWEN IFILL: There seem to be two big problems here. One is coming up with a solution. Exactly how do you do it? And the other piece is, how do you pay for it?

And one of the things he suggested was capping -- at one point, capping deductions for wealthy earners.

KAREN TUMULTY: That's going nowhere. Congress is not going to go along with that.

So, you know, if you require people to have health insurance, then, for a lot of people, you're going to have to give them some subsidies to go out and buy that health insurance. That's one reason that this plan, if it gets anywhere near universal coverage, is going to be extremely expensive.

Price tag for universal coverage

Karen Tumulty
Time Magazine
People had said as much as $1.5 trillion over the next 10 years. So the question is, where do you find the money to pay for it?

GWEN IFILL: How expensive are we talking?

KAREN TUMULTY: People had said as much as $1.5 trillion over the next 10 years. So the question is, where do you find the money to pay for it?

And Americans right now get a -- Americans who have health insurance get a big subsidy from the fact that the federal government does not tax those health benefits that they are provided by their employer to the tune of something like $250 billion a year. If you begin to start talking about taxing that, that's going to be a really difficult political question, but that's where you could find the money to pay for universal coverage.

GWEN IFILL: Well, labor unions aren't really crazy about that idea of taxing health care benefits, are they?

MATT BAI: No, they hate that idea. And they hate that idea particularly because, even if you only tax the lavish plans, you know, labor has worked very, very hard in a lot of places to get what's called, you know, Cadillac plans, really good benefit packages. It's a way of giving their workers something other than, you know, the pay that's hard to attain. And so they really do oppose that.

But, you know, the point Karen is making is right. This is going to require hard decisions, and hard decisions are probably not going come from Congress. I'm not being disparaging; I'm saying that's not what Congress does best, right? It's going to...

GWEN IFILL: Where do they come from, then?

MATT BAI: It's going to have to come, I think, from the president going out and saying to people, "Look, not only do I need to get a health care plan, there are going to be sacrifices involved." Only a president can effectively make the case for significant sacrifice.

And I think to pay for this it's going to have to be there. And I do think this is the issue that threatens more than the public plan, more than the substantive stuff to derail the process, because that's a whole big chunk of change.

GWEN IFILL: Is that what the president is starting to do when he goes out to Green Bay this week? He's going out to start saying, "OK, here's what you have to give up"?

KAREN TUMULTY: The other thing he's got to do -- you can already see the opposition coming. From the right, the opposition is: This is a big government plan. The heavy-handed government is going to get between you and your doctor. Essentially, it's fomenting the exact sort of scare that really made people in 1994, the last time we tried to do this, decide, you know, I'd rather have what I've got than go into this new system.

So the president is going to try and reassure Americans that, if you like what you have, you can keep it.

He's also got to talk to his liberal base, because these are people who would like to see a government plan. They would like to see single-payer health care. And they are angry right now that that is not on the table.

GWEN IFILL: So as the president tries to figure, as the White House and Congress try to figure this out, who are the players? You spent a lot of time for your story in the Sunday Times magazine this weekend, Matt, writing about Obama taking the Hill, I think may have been the headline.

MATT BAI: Right, yes.

GWEN IFILL: How do they do that? And who are the people who they're trying to take?

MATT BAI: Well, you know, the key person I looked at and focused in on here was Senator Baucus in Montana, because he's the chairman of the Senate Finance Committee. It's very powerful in this process.

Because in the House, although you have, you know, Charles Rangel and Henry Waxman, some very important people, and the committees are doing their work, the House he's going to get a plan through. And he is probably going to get a very progressive plan through the House because of the margins involved there.

The Senate's a different story. And Senator Kennedy, who, of course, has been forefront on this issue, is, you know, not well. His staff is engaged, and they've just come up with a version of a bill, but he's not going to be out front. He's not going to be the person you see.

So Senator Baucus, the Finance Committee becomes sort of the critical pivot person here in the Senate. And it's really his moment. He is a relatively low-profile senator for a guy with his power. He's kept it pretty low key in many, many years in the Senate. But this, I think, the moment where he sees the opportunity to do something really historic for himself.

Relationships in Capitol Hill

Matt Bai
The New York Times
Jim Messina is the deputy chief of staff in the White House. He's also not just a former chief of staff for Senator Baucus. Senator Baucus at one point has said this is like another son to him.

GWEN IFILL: And one of his key staffers is now working in the White House for President Obama.

MATT BAI: Right, and I don't think that's incidental. I mean, Jim Messina is the deputy chief of staff in the White House. He's also not just a former chief of staff for Senator Baucus. Senator Baucus at one point has said this is like another son to him.

And so that's been, I think, critical, because, you know, the president and Senator Baucus do not have a strong relationship. They didn't know each other well in the Senate. But they've put a lot of effort into building that relationship in the last couple months, and a key part of that is him being able to call his former confidante and either vent, or get something across, or hear what's being thought on the other side.

GWEN IFILL: Let's talk about relationships. On the Republican side, there was a little dustup this weekend involving Senator Grassley, the ranking Republican on the Finance Committee, who apparently, using Twitter, struck out at the president, actually.

KAREN TUMULTY: And Senator Baucus is also the best shot that they have at bipartisanship, because Senator Baucus and Senator Grassley, who have traded the chairmanship of the Senate Finance Committee back and forth now several times, are very close.

They're very close personally. They're very close professionally. Their staffs work together almost as one. It's very unusual to see a Democrat and a Republican who can work like this together.

GWEN IFILL: But can this Republican work with this president?

KAREN TUMULTY: I think it's...

GWEN IFILL: Let's tell people what we're talking about, what he said to him.

KAREN TUMULTY: Senator Grassley basically said to the president, Forget this public plan. It is not going anywhere. And I am -- he said, If you're a hammer, everything looks like a nail, and I am not a nail.

I think Senator Grassley has been very up front about the fact that he doesn't like a public plan, but Senator Baucus is still confident that he can somehow bring Senator Grassley around.

GWEN IFILL: So you think there is room at least for the beginning of this conversation on all sides right now?

KAREN TUMULTY: I think at this point. What's really surprising for those of us who watched this the last time is the fact that everybody is still at the table. They haven't yet sort of disappeared into their separate camps.

That may happen. History, you would bet that it would happen. But right now, everybody is really trying to stay at the table and keep talking.

GWEN IFILL: You're seeing the same thing, Matt?

MATT BAI: Yes, we're at that moment right now. We've had a very wide window of maneuverability. And just this past weekend, with the president's comments, Senator Grassley -- now we're starting to see the rubber hit the road, so to speak, and where, you know, people are saying what they want, what they won't take.

That's the question, because Senator Baucus' attitude has been all along, I don't want to pass this without bipartisan support. The only way I want to do this is with support from both parties, and so I want everybody at the table negotiating everything.

You can only do that for so long. You get to a phase where somebody's got to start to give on their vision. We're just hitting that moment.

GWEN IFILL: We'll be watching to see when that begins to happen. Matt Bai, New York Times, Karen Tumulty, Time magazine, thank you both.

MATT BAI: Thanks, Gwen.

KAREN TUMULTY: Thanks.