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Political Divisions Intensify Over Costs of Health Reform

July 21, 2009 at 6:00 PM EDT
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President Barack Obama pushed back Tuesday against stepped-up Republican efforts to question his health reform agenda. Four members of key congressional committees discuss the divisions on Capitol Hill.

JIM LEHRER: President Obama pressed again for consensus on health care reform today. In a series of appearances, he appealed for action in the face of mounting resistance.

NewsHour health correspondent Betty Ann Bowser has our lead story report.

U.S. President Barack Obama: I think this has to be done.

BETTY ANN BOWSER: The president picked up where he left off last night in his interview with the NewsHour.

BARACK OBAMA: Good afternoon, everybody.

BETTY ANN BOWSER: In the White House Rose Garden, without naming names, Mr. Obama took on Republican efforts to kill the kind of legislation he wants.

BARACK OBAMA: I know that there are those in this town who openly declare their intention to block reform. It’s a familiar Washington script that we’ve seen many times before.

But there are many others who are working hard to address this growing crisis. I know that there is a tendency in Washington to accentuate the differences instead of underscoring common ground. But make no mistake: We are closer than ever before to the reform that the American people need, and we’re going to get the job done.

BETTY ANN BOWSER: Still, Republicans have stepped up efforts to stop the president’s plan and derail his push for speedy action.

AD NARRATOR: They’ve loaned Barack Obama their future without even knowing it.

BETTY ANN BOWSER: The GOP is using a national advertising campaign to target the Democratic initiative.

AD NARRATOR: … a risky experiment with our health care. Barack Obama’s massive spending experiment hasn’t healed our economy. His new experiment risks their future and our health.

BETTY ANN BOWSER: Republican National Committee Chairman Michael Steele went after the House Democrats’ proposal to impose a surtax on families earning more than $350,000 a year.

MICHAEL STEELE, republican party chairman: The Democrat plan does not contain costs. It shifts them to the taxpayer, to our children, and to future generations that will have to cope with this crushing debt by implementing huge premium subsidies and establishing a government-controlled health care plan.

BETTY ANN BOWSER: Last night, House Speaker Nancy Pelosi suggested an alternative that would affect fewer people. It would raise the limit on the proposed tax increase to $500,000 a year for individuals and $1 million for families.

A proposal to tax the wealthy has received a frosty reception in the Senate. So once again, members of the key Finance Committee met behind closed doors in the office of Committee Chairman Max Baucus to talk about ways to pay for health care reform. One idea floated today would have insurance companies pick up a sizable portion of the tab.

This afternoon, Senate Majority Leader Harry Reid said failure is not an option.

SEN. HARRY REID, D-Nev., Senate majority leader: We’re closer to ever — closer than ever in getting it done. The American people, doctors, hospitals, the pharmaceutical industry, and many others want us to cross the finish line. But the party of no is hoping that we’ll trip and fall. And they’re saying it publicly.

BETTY ANN BOWSER: Republican senators insist they are not opposed to reforming health care, they just don’t like the Democrats’ approach. Minority Leader Mitch McConnell.

SEN. MITCH MCCONNELL, R-Ky.: If you think of all the issues we care about, obviously, health care is right at the top of the list, because it deals with each of us in a very personal way. So let me repeat again: This is not about winning or losing. This is about getting it right. And we saw with the stimulus the effort to rush and spend.

BETTY ANN BOWSER: This afternoon, the president summoned House Democrats on the House Energy and Commerce Committee to the White House. Conservative Blue Dog Democrats in the group, led by Arkansas’ Mike Ross, say the more than $1 trillion price tag is too high.

REP. MIKE ROSS, D-Ark.: There’s about 10 issues that we’re concerned with. Obviously, cost-cutting is first on that list.

Today, the more than an hour we spent with the president today focused specifically on cost containment. There’s a lot of ideas out there, a lot of good negotiations. It was productive.

No final decisions are yet made on cost-containment measures, because, quite frankly, we’ve got to wait for the CBO to score the bill as well as these potential cost-cutting measures.

Cost containment primary concern

Sen. Chris Dodd
We're looking at 50 percent of a family's income in 8 to 10 years that could be consumed by health care premiums if we don't act.

BETTY ANN BOWSER: And House Majority Leader Steny Hoyer warned today many other Democrats have voiced concerns, too. He suggested action on a House bill might have to wait until after the August recess.

JIM LEHRER: Judy Woodruff takes the story from there.

JUDY WOODRUFF: Difficult negotiations are expected to continue in the House, in the Senate, and at the White House throughout this week, and likely right up to the August recess.

We get four perspectives on some of the key divides over health reform on Capitol Hill. Senator Chris Dodd is a Democrat from Connecticut, and he's chair of the Health, Education, Labor and Pensions Committee. His committee passed the only bill in the Senate so far.

Republican Senator Lamar Alexander of Tennessee is also a member of that committee. He voted against that bill.

Representative Paul Ryan from Wisconsin is a Republican member of the House Ways and Means Committee, one of three House committees voting on health reform so far.

And Representative Jim Cooper is one of the so-called Blue Dog conservative Democrats. He is from Tennessee, as well.

Well, gentlemen, thank you all.

And, Senator Dodd, I'm going to start with you. I want to focus mainly in this conversation about the cost, because that seems to be the big hang-up. At this point, what do you see as the way to pay for this, the plan to pay for this, that has the best prospect of surviving the Congress?

SEN. CHRIS DODD, D-Conn.: Well, first of all, I'd mention what we've done in the bill, and that is, of course, if you like the plan you have, your doctor, your hospital, your insurance plan, you get to keep that. We don't want to change any of that. We want you to have all the freedoms that you'd like to have. Most people like the plans they have. They ought to be able to keep them.

Bringing down costs involve not only the price of what health care costs, but also the savings that we've tried to incorporate in our bill, a bill that ended up with a price tag of about $611 billion over 10 years. That was far less than the earlier predictions of twice that cost as a result of some of statements, some of the things we did in that bill: prevention, quality care, information technology, for instance, will do an awful lot to bring down costs.

So you need to be doing everything you can to reduce the cost of health care. The studies that have been done, a piece by a Dr. Gawande in the New Yorker a few weeks ago pointing out some of the problems. And, clearly, that requires effort.

The Congressional Budget Office doesn't give you much credit for savings, only the costs of various things of doing various things. I understand that. But when you have families today where you have 62 percent of bankruptcies, the cost to that family of a health care crisis puts them in bankruptcy.

Fifty percent of the foreclosures in the country are caused by a crisis, a health care crisis in that family. Those costs CBO doesn't tabulate when we're talking about health care.

We're looking at 50 percent of a family's income in 8 to 10 years that could be consumed by health care premiums if we don't act; $1,100 to $1,500 of those premiums you're paying today are to cover the uninsured, the numbers at 45 million.

Thirty million Americans are underinsured, out-of-pocket expenses rising. All of those costs we don't talk about that are a part of the health care problem today.

So I'm hopeful we can get to a strong bill, a good bill, I'd love a bipartisan bill if we can get one, but it's most important we get a good bill for the American people.

JUDY WOODRUFF: So just, quickly, back to my question, though. If you could just answer: What do you think is the method of paying for what's over and above the savings that has the best shot of passing?

SEN. CHRIS DODD: Well, I think what Senator John Kerry has recommended today, you've mentioned it at the outset of the program. It's the subject of conversations in the Finance Committee, has some real possibilities.

Sharing that cost in ways that the industry itself could help pick up. It seems to me that, plus the savings that Doug Elmendorf mentioned, by the way, in the Budget Committee. When Sheldon Whitehouse raised the issue about savings, he acknowledged that that could help reduce these costs substantially. Don't discount that point.

JUDY WOODRUFF: Let me turn to Senator Alexander. Senator Dodd is not mentioning some of the other things that are getting a lot of attention: taxing the wealthy over a certain income level, doing away with the -- or, rather, changing the deduction level that would be taxed, again, for wealthy Americans.

What do you think, Senator, from your perspective is the best way to pay for whatever emerges from Congress, assuming something emerges?

SEN. LAMAR ALEXANDER, R-Tenn.: Well, I think we should start over either with something like the Wyden-Bennett bill, which 14 of us senators in a bipartisan way have sponsored or several of the Republican proposals. I think Congressman Cooper also supports the Wyden-Bennett bill, and it doesn't add a penny to the deficit.

What it does is basically you take the subsidies that we're now giving to Americans for health care and rearranging them in a fair way so that everybody could have a policy, could afford a policy that would be about like what congressional employees have.

But what we have instead is a bill Senator Dodd said added $631 billion to the deficit over 10 years, but he didn't count all the people who are going to be dumped into Medicaid, and that would make it more like $2 trillion over 10 years, if the program's fully implemented.

And you're right. He didn't mention the employer taxes and cutting grandma's Medicare payment and spending it on something else. And the Democratic governors are up in arms over shifting Medicaid costs to states, and the Mayo Clinic is saying we're headed in the wrong direction. I think we ought to start over.

Reform in the first-draft stage

Sen. Lamar Alexander
What we have instead is a bill Senator Dodd said added $631 billion to the deficit over 10 years, but he didn't count all the people who are going to be dumped into Medicaid, and that would make it more like $2 trillion over 10 years.

JUDY WOODRUFF: Well, let's turn over to the House and let's hear from you, Representative Cooper. Do you support what Senator Alexander was just saying? And as a Democrat, do you see a way out of this dilemma? Because, right now, there are so many different perspectives we're still hearing.

REP. JIM COOPER, D-Tenn: Well, Judy, believe it or not, there are bipartisan solutions to this problem. Senator Alexander mentioned one that both he and I support. We can figure out solutions that bring affordable health care to all Americans. I think we can do that this year.

But it's going to take a lot more congressional work. The legislative process is really now just in its first-draft stage, so we should not by any means lose hope. I know there are some Republicans who want to kill the whole thing.

But we can get this done for the American people. We've been waiting a long time for this. And most American families are really worried about their health coverage. And we can make it more affordable, and we can improve the quality, too.

JUDY WOODRUFF: Can you, in one phrase, Congressman Cooper, say what is the best payment method that's going to work here?

REP. JIM COOPER: Yes, Judy. We need to get all the payment from savings from the current system. We're estimated to waste about $700 billion a year in payments that not only don't improve our health, but actually sometimes harm our health. So we should go after those savings. "Overtreated," the book by Shannon Brownlee, the Dartmouth work, the McKinsey data have pretty much proven the $700 billion.

JUDY WOODRUFF: So all in savings? You think that's realistic?

REP. JIM COOPER: Yes, absolutely.

JUDY WOODRUFF: All right, Representative Ryan, Republican in the House. If the Democrats were able to do that, if they were able to get it all from savings, would that work?

REP. PAUL RYAN, R-Wis: If all the Democrats were like Jim Cooper, I think we could get a deal. Unfortunately, they're not all like Jim Cooper.

A problem we have here is the bill that's being rushed to the floor next week, the House leadership is saying next week we will vote on this bill, no one's read this bill.

This bill, according to the Congressional Budget Office, has a huge deficit attached to it. This bill, according to the Congressional Budget Office, will create a new unfunded entitlement that will rival the size and likes of the liabilities with Medicare and Medicaid.

And so I do, too, like Jim and Lamar, believe -- I have issued with that particular bill they're talking about, but I do believe you can have health insurance reform that gets everybody insurance, even if you have a pre-existing condition problem, without new taxes, without all this new spending, and without having the government take it over.

There is a way to get to bipartisan health care reform, but the bill they're trying to jam through Congress next week, which we believe quantitatively and demonstrably involves a government takeover of health care, is not the way to go.

More importantly, this is too important to rush this thing through Congress. This is 17 percent of our economy. Let's sit down and do it right. And if they want to make it bipartisan, then you have to have collaboration with the minority, and they're not doing anything like that in the House.

JUDY WOODRUFF: Senator Dodd, why doesn't that idea work? You hear the criticism that you're talking about an unfunded entitlement, it's going to cost way more than the government -- than taxpayers can afford, let's slow this down.

SEN. CHRIS DODD: Well, first of all, slowing it down -- it's been 70 years since this has been discussed. Every administration, every Congress has grappled with this.

In the past, it was unacceptable not to deal with it. It's now unsustainable. You mentioned the number 17 percent of GDP. That number could jump to 35 percent over the next 8 to 10 years.

So that family tonight that's watching this program, if we just sit back and do nothing -- and, unfortunately, that seems to be a mentality of far too many -- then we're going to end up in a situation where 50 percent of that gross income of that family will be consumed in health care premiums. So we must act.

And I think you can't talk about accessibility, reducing costs, and providing quality, and have it just wish it that's going to occur. You need shared responsibilities, an individual mandate.

You're going to have to have employers -- we want to keep them in plans. But with people who employ more than 25 people, they have the choice of providing the health care coverage or paying into a system -- in our bill, $750 for a full-time employee, $350 for a part-time. That's $2 a day.

You can call that a tax or a fine, if you want. But that's the sort of shared responsibility we're going to have to have if you're going to achieve access, if you're going to achieve reduced costs and bring more people into the program.

So with all due respect to my colleagues here talking -- I think Jim Cooper comes the closest to it -- savings really can pay a tremendous amount of this.

The idea that we're all for these ideas -- Lamar Alexander and I don't disagree. He's absolutely correct on the Medicaid issue. We've got to deal with that. I understand that. He's right about it. You can't just pass that on. But that's the challenge in front of us to get that, and I'm confident we can do it.

JUDY WOODRUFF: Senator Alexander, what about this idea that Senator Dodd is describing of shared responsibility, that you just can't get there, you can't get the coverage that he is saying the country should have unless somebody pays more?

More debt over next 10 years

Rep. Jim Cooper
We need to get all the payment from savings from the current system. We're estimated to waste about $700 billion a year in payments that not only don't improve our health, but actually sometimes harm our health. So we should go after those savings.

SEN. LAMAR ALEXANDER: Well, I agree with Jim Cooper. If we're paying twice as much as many industrial countries right now of our gross domestic product for health care, that's enough. And at a time when the president has proposed more new debt over the next 10 years than at any time in the next -- than we've spent in World War II, actually, three times as much as we spent, we can't risk a lot more debt.

So I don't know what shared responsibility means. I think we have proposals on the table. I mentioned one. There are several others that could cover almost everyone without adding to the debt.

The other way to do it -- and it's just to recognize we may be biting off more than we can chew -- and start looking around the country for these places like Vanderbilt, and the Mayo Clinic, and Salt Lake City, and Dartmouth that we all have talked about, Pittsburgh, where doctors and hospitals have organized themselves into delivery systems that have good results at low cost and gradually expand those until we reduce our costs and then add the uninsured.

JUDY WOODRUFF: Congressman Cooper, do you see something, a kernel of something in the plan that Senator Dodd is talking about and in what you and Senator Alexander are in favor of that could work, that could come together to make something that would pass?

REP. JIM COOPER: I do, Judy. There's a lot of good in the Senate Health Committee bill. Unfortunately, it's not quite in the CBO specifications yet. It spends too much money. But we can trim that back some.

The Senate Finance Committee has not yet announced their project, their proposal, and they will be the ones that will have to pay for anything.

So this can be done. This is just a first draft. The legislative process is always messy, so we should not lose hope here. It's gotten off to a little bit of a rocky start, but we can get this done.

JUDY WOODRUFF: And, Congressman Ryan, is it your view and the view of many of your Republican colleagues that you're going to stop this at all costs, that you just don't want anything like what they're talking about to pass?

REP. PAUL RYAN: Well, we want health care reform that works, health care reform that does not involve the government taking over the sector.

You have to understand, the experts are telling us 2 out of every 3 Americans will lose the private health insurance they have right now if this plan that's going through the House passes into law. That is not keeping with the idea if you like what you want, you can keep it.

Senator Alexander said something very important, too. We already spent more than 2.5 times per person on health care in America than any other country. We're spending lots of money. Let's spend that money more efficiently and more effectively than raising all of these new taxes, borrowing all this additional money to put on top of the $5 trillion our government is already projected to spend over the next 10 years for the under 65 population.

So we want to do it, but we want to do it right. And we believe that this bill, all the experts telling us, will actually cause people to lose the health insurance they have right now and will exacerbate our health care cost problems, not contain it.

Thousands lose health care daily

Rep. Paul Ryan
Rather than spending next week voting on a bill no one has read in Congress that the Congressional Budget Office says makes our fiscal problem even worse, I think we should talk to our constituents during the August recess.

JUDY WOODRUFF: Senator Dodd, is President Obama rushing this too fast? I want to read you quickly a quote from Congressman Charlie Rangel, who, of course, influential committee chairman in the House, who said this afternoon, overheard by reporters, to say, "No one wants to tell the speaker she's moving too fast and they," quote, "damn sure don't want to tell the president."

SEN. CHRIS DODD: Well, look, you have to keep working at this. And, obviously, I hope we can get something moving in the next few weeks, might even consider maybe slowing down the August recess.

Fourteen thousand people a day have lost their health care before we all finish our work here. Every day, 14,000 people do, along with the 20,000 who lose their jobs, 10,000 losing their homes. I mentioned the bankruptcy and the foreclosure issues related to the health care crisis.

Lamar is correct. We're spending today -- and Congressman Ryan -- we're spending $2.5 trillion on health care. We rank 37th, the United States does, in the world on outcomes. We're at the bottom among industrialized nations on infant mortality.

Every indication -- in fact, a study out of Tennessee indicates that this generation of young people will be the first generation of Americans who don't live as well or possibly as long as their parents. That's since the founding of the republic.

This issue demands our attention and time. Whether or not we can get it done in a couple of weeks or not, I don't know, but we need to keep at it. If you don't stay at this, I fear we'll miss this moment that doesn't occur very often. It's been almost 20 years since the last time we tried.

And as I said a moment ago, it is unsustainable from an economic standpoint, as well as the needs of people all across our country.

JUDY WOODRUFF: Senator Alexander, I know, from what you've said, you don't support this. But of the proposals that have been raised on the Democratic side for how to pay for this, whether it's limiting tax deductions for people earning over $250,000 a year, whether it's taxing a higher tax on the wealthy or whatever, is there one of those formulas that you think, from your perspective, would have a better chance of passing?

SEN. LAMAR ALEXANDER: Well, Judy, I want to answer your question, but I can't do that, because that's the wrong place for me to start. I don't support adding to the debt to pay for these bills.

As I said, we've got the Mayo Clinic, we've got the Democratic governors, we've got the Congressional Budget Office telling us we're going in the wrong direction. We've got bills before the Congress, which I support and others do, that say we can do this without adding to the debt.

And about the only thing bipartisan about what we've done is the opposition to it. Chris Dodd has conducted a heroic committee session and was very friendly, but, basically, Republican ideas and ideas from others have not been included in what we're doing.

We should start over. And of course we can get this done this year.

SEN. CHRIS DODD: Can I mention one thing, Judy? With my good friend here, we accepted 161 Republican amendments in that markup. It is a bipartisan bill.

REP. PAUL RYAN: There's not that many in Ways and Means.

SEN. CHRIS DODD: Well, but I'm talking about our bill, 161. We dealt with 800 amendments over 23 sessions, 15 days, 60 hours. And at the end of it, I identified each of my colleagues and the contributions substantively they made to this bill. Now, they didn't vote for it in the end, but it is a bipartisan bill.

SEN. LAMAR ALEXANDER: Those were technical amendments that made no real difference except in about two cases.

SEN. CHRIS DODD: Well, a lot more substantive.

JUDY WOODRUFF: Let me ask both Congressman Cooper and Congressman Ryan how you see this playing out over the next few weeks. What do you think is going to happen here?

REP. JIM COOPER: Judy, I think everybody is going to get more realistic in their expectations. Many people are just learning about these issues, some of which are quite complicated.

But the bottom line is, American families need help. Virtually everyone is having a hard time finding affordable health insurance. And we're all going to get sick or injured sooner than we realize. And this has to be something that works for all Americans, regardless of politics. So we can get this done.

JUDY WOODRUFF: Congressman?

REP. PAUL RYAN: Rather than spending next week voting on a bill no one has read in Congress that the Congressional Budget Office says makes our fiscal problem even worse, I think we should talk to our constituents during the August recess.

I'm holding town hall meetings on health care. We all should be doing that so we can talk to our constituents, get the public to see what this legislation is all about, and then come back in September well informed after having touched base with each of our employers, the constituents we represent.

JUDY WOODRUFF: Congressman Paul Ryan, Congressman Jim Cooper, Senator Chris Dodd, sounds like you still have some work to do to get this done, and Senator Lamar Alexander, gentlemen, thank you all.

JIM LEHRER: On our Web site,, you can visit our health care reform page for a guide of terms and key players involved in this debate.