>> 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 m