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Skriven 2006-02-16 23:33:26 av Whitehouse Press (1:3634/12.0)
Ärende: Press Release (0602163) for Thu, 2006 Feb 16
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President Participates in Panel Discussion on Health Care Initiatives
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For Immediate Release
Office of the Press Secretary
February 16, 2006

President Participates in Panel Discussion on Health Care Initiatives
U.S. Department of Health and Human Services
Washington, D.C.


˙˙˙˙˙Reforming Health Care for the 21st Century
˙˙˙˙˙In Focus: Health Care
˙˙˙˙˙In Focus: Medicare

1:18 P.M. EST

THE PRESIDENT: Thank you all. Thanks for the warm welcome. Thanks for
coming. We're about to have a discussion about how this country can make
sure our health care system is available and affordable. I want to thank
our panelists for joining us. It's an interesting way to describe and
discuss policy -- it's a lot better than me just getting up there and
giving a speech, you don't have to nod. (Laughter.)

You want to kick things off, Mark?

DR. McCLELLAN: I'd be glad to. I'd like to welcome all of you to the
Department of Health and Human Services. As you know, there are many people
who are working day and night to protect the public health, to help our
health care system work better.

We have the privilege of working with the best health professionals in the
world -- doctors, nurses, others who have some great ideas about delivering
better care and about finding ways to do it with fewer complications and at
a much lower cost. But in many ways our health care policies haven't kept
up with what our health care system can do, and we're going to spend some
time talking about that today.

Mr. President, we're very pleased to have you here today to lead this
discussion of some new ideas for improving our health care.

THE PRESIDENT: Thank you, Mark. Thanks, Mike Leavitt -- where are you,
Michael? Surely, he's here? (Laughter.)

DR. McCLELLAN: He's in Florida, Mr. President.

THE PRESIDENT: Oh, he's in Florida. Okay. Surfing. (Laughter.) Actually, I
saw him this morning -- don't make excuses for him. He's doing a heck of a
job, he really is, and I hope you enjoy working for him. (Applause.)

I am really pleased that Nancy Johnson is here. Madam Congresswoman, thank
you for coming. (Applause.) If you want to meet somebody in Congress who
knows something about health care, talk to Nancy; she is a tireless
advocate for making sure the health care systems are efficient and
compassionate. And I really want to thank you for coming. It's a joy to
work with you on these big issues.

I thank all the folks here at HHS. Thank you for working hard on behalf of
our fellow citizens. You've got a tough and important job, and you're doing
it well. One of the reasons why is because, you know, we've clearly defined
the roles of government -- with the role of government in health care. And
one of the roles is to make sure our seniors have a modern, reformed
Medicare system. And I want to thank those of you who are working on making
sure that the Medicare system is explained to and available for seniors all
across the country.

We did the right thing when it came to saying that if we're going to have a
program for seniors, let's make sure it works as good as possible. And part
of that meant modernizing the system so it included a prescription drug
benefit. It's not easy to sign up millions of people in a quick period of
time to a new program, and there were some glitches. The good thing about
this Department, and the good thing about Mike and Mark is that they have
prioritized problems to be fixed, and have gone around the country fixing
them.

Millions of folks -- about 25 million people have signed up for the new
Medicare benefit. I don't know if you remember when we first had the
discussions about the Medicare benefit, and people said, it will cost about
$37 a month per beneficiary. One of the interesting reforms is not only
making sure that medicine was modernized, but seniors actually were given
choices to make in the program. And Mark has done a fine job of encouraging
providers to be the markets. And as a result of choice in the marketplace,
the average anticipated cost is $27 a month.

In other words, giving people a decision to make is an important part of
helping to keep control of cost. We have a third-party system -- a
third-party payer system. When somebody else pays the bills, rarely do you
ask price or ask the cost of something. I mean, it seems kind of
convenient, doesn't it? You pay your premium, you pay your co-pay, you pay
your deductible, and somebody pays the bills for you.

The problem with that is, is that there's no kind of market force. There's
no consumer advocacy for reasonable price when somebody else pays the
bills. And one of the reasons why we're having inflation in health care is
because there is no -- there is no sense of market. We're addressing the
cost-drivers of health care, and this discussion today is a part of helping
to make sure health care is affordable. And as it becomes affordable, it
becomes more available, by the way.

A couple of ideas other than the subject at hand to make sure health care
is affordable is -- and we'll talk a little bit about information
technology; I know there's a great initiative here at HHS to help bring the
health care industry into the modern era by implementing information
technology reforms. And for those of you working on the project, thanks,
and we take it very seriously at the White House, and I know you take it
seriously here.

Secondly, I want to thank those of you who are working on community health
centers. One way to help control costs is to help people who are poor and
indigent get costs [sic] in places that are much more efficient at delivery
of health than emergency rooms. And so we're committed to expansion of
community health centers. Again, thanks on that, Nancy, for helping in
Congress. They work. We're measuring results and the results are good
results.

Thirdly, lawsuits are running up the cost of medicine. The practice of --
the defensive practice of medicine or the practice of defensive medicine --
I'm a Texan. (Laughter.) It costs about $28 billion a year when doctors
over-prescribe, to make sure that they kind of inoculate themselves against
lawsuits. It runs up federal budgets. It costs the economy about $60
billion to $100 billion a year.

And so we've got to do something about these junk lawsuits. I mean, they're
running good people out of practice. I said a statistic the other day in
the State of the Union that's got to startle you if you're involved with
the health care delivery in America: 1,500 counties don't have an OB/GYN
because lawsuits have driven a lot of good docs out of those counties. And
that's not right.

And so we've got to get medical liability reform. The House has done a good
job of passing it. It's stuck in the Senate. So for the sake of affordable
and available health care, is to get a good, decent bill passed.

One other way to help control costs is to interject market forces, as I
mentioned. And one way to do that is through what's called health savings
accounts. Health savings accounts are an innovative product that came,
really, to be as a result of the Medicare bill that I was honored to sign.
They're an innovative account that combines savings on a tax-free basis
with a catastrophic health care plan. We'll have some consumers here of
health savings accounts that will describe how they work and whether or not
they're working worth a darn.

But the key thing in a health savings account is you actually put a patient
in charge of his or her decisions -- which we think is a vital aspect of
making sure the health care system is not only modern, but a health care
system in which costs are not running out of control. And part of making
sure consumers, if they have a decision to make, can make rational
decisions is for there to be transparency in pricing. In other words, how
can you make a rational decision unless you fully understand the pricing
options or the quality options. When you go buy a car, you know, you're
able to shop and compare. And, yet, in health care, that's just not
happening in America today.

And so one of the -- this discussion is centered around encouraging
consumer-based health care systems and strengthening private medicine
through transparency and pricing and quality. And I hope you find this as
interesting a discussion as I will.

I'm going to start off with Dr. Gail Wilensky. Do you know anything about
health care? (Laughter.) She knows a lot about health care. You've been
working the health care industry for, what -- tell us what you do.

DR. WILENSKY: I'm now a Senior Fellow at Project HOPE. A while ago I had
Mark's position, trying to manage Medicare and Medicaid, a very challenging
activity.

You've given a lot of what I wanted to say; let me say it quickly, in terms
of why this is an issue and what we need to do about it.

For far too long Americans haven't known what they pay for health care.
They haven't really cared much about what they pay for health care. They
haven't realized that questions about patient safety and quality were
appropriate questions to ask. The biggest reason is because the employers
were making all the decisions for individuals, and individuals didn't
usually realize this was their money.

Now it has changed in part, for some employees, because as a result of the
Medicare law employers can offer health savings accounts paired with
high-deductible health plans. And for those employees -- and they're now,
estimates are about 3 million people have these health savings accounts,
they have the motivation to find out more about what health care costs and
what they're getting for their money.

There's been a problem that people who don't have employer-sponsored
insurance or who aren't eligible for some reason, they don't have that
opportunity, and you had mentioned in the State of the Union that's one of
the next steps that needs to happen, that it's fair that people who don't
have employer-sponsored insurance also have this option.

But while making people conscious of what it might cost will help, if
you're really going to empower someone you've got to give them the
information. It's got to be easily obtainable. They need to know what it
costs to go into a hospital, or to have a major procedure, or to have a
major device implanted. And they need to know something about what they're
getting for their money. They need to know whether there are major
complications when a particular hospital does something. Or whether someone
has good outcomes and whether the patients are satisfied in going to them.

So that's really this next step. In order to empower patients, they need to
know what it costs and they need to know what they're getting for their
money. And it means insurers doing something and providers doing something
and the government and Medicare helping where they can. And that's really
where we are today.

THE PRESIDENT: Thank you for the lead-in. We spend a lot of money at the
federal level, and you would expect that if we're sitting up here talking
about transparency then we ought to do something about it. I mean, the
federal government is the largest purchaser of health care -- am I right --
46 percent of all health care dollars.

DR. McCLELLAN: That's right.

THE PRESIDENT: Okay. What are you going to do about it? (Laughter.)

DR. McCLELLAN: Well, Mr. President, we are doing a lot about this already,
as you know. Before the Medicare drug benefit, Medicare provided a drug
discount card for millions of seniors to enable them to save billions of
dollars. And with that card we made available information on discounted
drug prices for all the prescription drugs and all the pharmacies around
the country. Seniors use that information to keep prices down. They
shopped, and we saw during the course of this program savings actually
increase over time. We also saw lots of seniors switching to drugs that
they found out about that could meet their medical needs at a much lower
cost.

THE PRESIDENT: One thing a person watching out there -- what we're talking
about, for example, when it comes to putting information out on drugs, a
brand name drug and a generic drug do the same thing, but there's a huge
price differential. And what Mark is saying is, is that we made, as a
result of our government policies, the providers to provide a shopping
list, a comparison for people to get on the Internet and find out whether
they can buy a drug cheaper or not.

DR. McCLELLAN: That's right. And many people are saving 70 percent or 80
percent or more on their drug cost by switching to generics. You can get
his information on the Internet. You can also get it by calling
1-800-MEDICARE. And we're doing the same thing with the drug benefit. And
that's one reason the drug benefit costs now are so much lower than people
expected, as you mentioned earlier.

We're trying to make more information available on hospital quality, on
nursing home quality, on many other aspects of health care. But we can't do
this alone; we've got a public/private health care system, so we need to
work with health professionals, with consumer groups, with business
purchasers and with the health plans in this country to get useful
information out. We started to do that through collaborative efforts, like
the Hospital Quality Alliance and the Ambulatory Care Quality Alliance.
These are groups that include all of the different key stakeholders in our
health care system working together to make useful information available on
quality and cost.

Some of that has happened already, but I think with the leadership from the
President and with the full backing of the federal government we can move
this effort along much more quickly and much more extensively to get
information out about satisfaction with care; to get information out about
outcomes of care and complications; and to get information out about cost.
And, Mr. President, we're very pleased to be starting right now a new
program that will be piloted in six large communities around the country,
where all these different groups -- the health professionals, business
groups, government organizations, including Medicare and the Agency for
Health Care Research and Quality, and health plans -- are going to be
working together to make useful information available to consumers and
health professionals in these communities about the quality and costs of
their health care. And, hopefully, we'll be able to move this project along
very, very quickly.

THE PRESIDENT: Good.

DR. McCLELLAN: We're working.

THE PRESIDENT: Nice going. Yes, I know you are. You're working hard. Mark
has also been responsive to some of the issues of the Medicare roll-out.
And they've been moving hard and traveling around the state. And thanks for
responding to what's going to end up being a really, really important
program for our seniors -- let me say, a revitalized important program for
our seniors. It's going to make a big difference. Thanks for working so
hard.

Robin Downey. What do you do, Robin?

MS. DOWNEY: I'm head of product development for Aetna.

THE PRESIDENT: Yes.

MS. DOWNEY: And I was instrumental in launching our HSA program. We've been
doing consumer-directed plans since 2002. And so we're the first national
plan to offer an HSA in the health plan arena.

THE PRESIDENT: Good move. I bet you're really selling a lot of them.

MS. DOWNEY: Yes, we are. The adoption is higher in the HSA than it is the
HRA now. It's increasing, and I'm probably one of Aetna's first members in
the HSA.

THE PRESIDENT: You and I both. We own an HSA.

MS. DOWNEY: Yes, yes, both in it.

THE PRESIDENT: Let me ask you something. Aetna, obviously, is a big health
insurance company. Do you -- obviously you've got an opinion on
transparency, otherwise you wouldn't be sitting here -- but give us from
your perspective, from the insurance company's perspective, tell us what
transparency means to you and how best we can work together to implement
the transparency.

MS. DOWNEY: Well, transparency to us means giving the consumer the
information on both cost and quality so that they can make an informed
decision and they can understand the value of what it is that they're
purchasing. And from our perspective, we tackled a lot of issues on
clinical quality and cost efficiency a couple of years ago and some things
we did in our high-performance networks.

Cost was kind of the black box -- nobody wanted to open it up. Everyone
said health plans will never give access to that information. And our CEO
said, it is time because of the adoption of the HSAs and how many people
are in consumer-directed products now. We needed to see that consumers were
getting the right information. So we decided to take a leadership role and
in the summer of '05 we launched a pilot in Cincinnati where we're
providing what we call "true price transparency." We actually negotiate
discounted rates with providers and that is the amount the patient is
responsible for. In a high deductible health plan, that's going to go
against your deductible, it's going to come out of your HSA -- so that is
the amount you would be responsible for. And we negotiate those prices, but
we never told you as a consumer what those prices would be.

And so what we did is we worked with the physicians in Cincinnati and we
worked with consumer groups and we have on our website now about 600
procedures -- up to 25 procedures for different specialties -- that you can
go out and see, by doctor, what our negotiated rate is for that doctor, for
that procedure, and it's about 5,000 doctors that are participating and
about 600 different procedures.

THE PRESIDENT: Good. And I presume there was resistance at first?

MS. DOWNEY: Not resistance, they wanted to know why. I think physicians are
wondering why the consumers need that kind of information. So they are
getting used to that. And then they were actually pretty helpful when we
were talking about how we were going to display it. They were saying, make
it easy for the patients to understand, so they're helping us take the
medical terminology, put it into layman's terms. They wanted to make sure
it wasn't going to create more work for them; were people going to be
calling their offices constantly. And that's what we want to do, we want to
put it on the website so they don't have to constantly call. So we want to
provide easy access.

And so they were also concerned with if you put cost information there, and
you don't have quality, then people will price shop on cost alone, and
they're very afraid of that -- and they should be, because people should
understand the --

THE PRESIDENT: So how do you handle that?

MS. DOWNEY: We're marrying that now. We're going to expand that pilot. It
was so successful, we're going to expand it into more locations in the fall
of 2006, and we're going to be marrying that information with the quality
information so the consumer can go out and see what the unit cost is, what
the efficiency is, what the clinical quality is. And so they can look at
the overall value. We're pretty pumped about it.

THE PRESIDENT: Well, I appreciate you doing it. It must be exciting to be
on the leading edge of an interesting innovation and to a -- into health
care. It's hard to believe that ours is a market society in which people
are able to shop based upon price and quality in almost every aspect of our
life, with the exception of health care. And it's no wonder that we're
dealing with what appears to be ever increasing costs.

You know, it's really interesting, LASIK surgery is a good example of a
procedure that was really -- was not a part of a third-party payer, just
came to be. People could choose it if they wanted to choose it, could pay
for it if they didn't want to -- would pay for it themselves if they chose
to use it. And more doctors started offering LASIK surgery, there was more
information about LASIK surgery, and the price came down dramatically over
time, and the quality was increasing. And now LASIK surgery is eminently
affordable for a lot of people, because the market actually functioned. And
I think what Robin is saying is that they're trying to introduce those same
kind of forces in Cincinnati.

Thanks for doing what you're doing. I met with your old boss today. Maybe
he's watching out there. (Laughter.)

MS. DOWNEY: He talks to me just the way you talk to Mark -- "just do it."
(Laughter.)

THE PRESIDENT: A little bossy. (Laughter.)

MS. DOWNEY: But you get stuff done.

THE PRESIDENT: Yes, that's right.

Dan Evans is the president and CEO of Clarion Health Partners in
Indianapolis, Indiana. Thanks for coming. You're doing some interesting
things. He's a hospital guy.

MR. EVANS: I'm the CEO of an academic medical center, so we have both a
university and a hospital. We have 4,000 peer review projects ongoing right
now, including --

THE PRESIDENT: Tell everybody what a peer review project is.

MR. EVANS: It's a research project that's overseen by a review board, so
it's scientific. And at the end of the day then it can be translated from
bench to bedside. So, for instance, if Lance Armstrong came to our hospital
for his cutting-edge testicular cancer treatment -- just for an example --
we have the doctor on the staff that changed the mortality rates from 90
percent to 10 percent, so we consider that one of our core functions, if
not the core function, is the research.

But what I'm running into is the same thing that Robin and Mark and Gail
described, and that is our patients want to be treated like customers and
they want to know what the value proposition is. So people are starting to
ask. As the HSAs become more popular and they become more informed, what
does this cost and, oh, by the way, is the institution that's doing it any
good at doing it. Because it's one thing to know the cost, but it's quite
another thing to know whether or not your length of stay is going to be
twice as long as it should be or you're likely to get an infection -- all
the things that CMS monitors.

We're in partnership with the CMS also on information technology. We
believe if we successfully manage my mom's information as she goes from
place to place -- including our competitors -- we'll reduce that
over-prescription that you talked about to protect docs from tort lawsuits.
As big as we are, we are the defendant in many tort lawsuits, and a great
many of them have no merit whatsoever, but the system takes you through
that. So the information technology for us converts data to information, in
real-time. I've seen it myself. There are patients at this table and those
patients are our customers. And not a day goes by that I don't walk out and
talk to a customer.

I work 20 feet from where I was born, so I'm in my hometown, which means
that I get the retail calls at my desk on a Wednesday afternoon -- you
know, mom has had a TIA, or, dad has had a heart attack, tell me, what do
you know about this Dr. McClellan. And we've --

THE PRESIDENT: He's not very good, but -- (laughter.)

MR. EVANS: We've got the data, and what we need to do is marry up that data
with Aetna, so that Aetna steers those patients to the high quality docs
and systems. Then the value proposition will take off.

THE PRESIDENT: So how easy is it to establish a matrix, or a -- information
for consumers to be able to really accurately understand?

MR. EVANS: It requires willing partners, for starters. Everybody in this
room can relate to the kid who breaks her leg on the soccer field, goes to
the quick-check place for pain, ends up at the ED at a suburban hospital,
turns out to be a multiple fracture, is life-lined, or taken downtown to
the academic medical center, and you carry your data with you, right?
You're your own mule.

The information technology will knit all that together so the doc downtown
can pull up my mom's data, my daughter's data, and look at it. It requires
willing partners who are willing to share data, not horde it. And the basic
principle is the data belongs to the patient, not to the hospital system.

THE PRESIDENT: Yes.

MR. EVANS: That's the paradigm. Heretofore the attitude has been the
information is owned by the insurance company, or it's owned by the
hospital, or it's owned by CMS. No, it's owned by the patient.

I recently went through this with my own mother, where she was handed the
films at the radiology center and told to walk them across the street to
the hospital. So in the real world, it happens every day. And through the
leadership of CMS and others, Indianapolis has become a demonstration
project for trying to link all these things together. At the end of the
day, it will drive down costs dramatically and improve quality
significantly.

THE PRESIDENT: We're really talking about making sure each American has an
electronic medical record over which he or she has got control of the
privacy. An interesting -- another example was what happened -- the
Veterans Administration, by the way, has implemented electronic medical
records. In other words, they're using modern technology to bring this
important agency into the 21st century. A lot of files at your hospital
still -- probably not your hospital, but the typical hospital are
handwritten.

MR. EVANS: Well, you know, what happens is, they may be electronic in the
hospital, but handwritten in the doctor's office --

THE PRESIDENT: Yes, and the doctors can't write anyways. (Laughter.)

MR. EVANS: Well, the pen is a very dangerous thing.

THE PRESIDENT: Yes, it is.

MR. EVANS: Yes, as you well know. (Laughter.)

THE PRESIDENT: And so the idea is to modernize doctors' offices and
hospitals and providers through information technology. And so the Veterans
Department has done this. In other words, each veteran has got an
electronic medical record. And so when Katrina hit, a lot of veterans were
scattered and they were just displaced. And you can imagine the trauma to
begin with. And the trauma is compounded if you're worried about your
record being lost somewhere, your medical record.

And, fortunately, because the veterans at the Department had already acted,
these medical records went with the patient and a lot of veterans got
instant help. And so a doc could, you know, kind of download their record,
take a look at what was prescribed before, take a look at other procedures
and, boom, the medicine and the help was brought up to speed quickly, which
is great. And I want to thank you for doing that.

Information technology is going to help change medicine in a constructive
way, and it does dovetail with price and equality.

Getting kind of a drift of what we're talking about here? (Laughter.) I
hope so. If not, we'll go over to Jerry, she'll help -- (laughter.) Jerry,
welcome. Where do you live? What do you do?

MS. HENDERSON: Mr. President, I live in Baltimore, Maryland.

THE PRESIDENT: Welcome.

MS. HENDERSON: And I am a nurse and I've been in health care for over 30
years. And for the last nine years I've had the responsibility of running
an ambulatory surgery center in Baltimore.

THE PRESIDENT: Good. Called?

MS. HENDERSON: The Surgery Center of Baltimore.

THE PRESIDENT: Very good. And tell us, you know, the transparency issue --
we had a little visit ahead of time, since it's not the first time I've
seen her; she gave me a little hint about what she was going to talk about.
Go ahead and share with people -- small clinic, relatively small clinic,
big hospital guy, small clinic person.

MS. HENDERSON: I think the ambulatory surgery centers offer a good, low
cost alternative for outpatient surgery for patients. And what we do, I
think we do a very good job of offering transparency for the patients
because we think it's important that they have the information that they
need, both for quality, safety and price. And so for our patients we offer
information on our website about our payment policies, we give them a
brochure about our patient payment policies. Then we also call the
insurance companies and make sure that they have their coverage and how
much that insurance company is going to pay. And then we call our patients
and we tell them, okay, your insurance is going to cover this amount and
you're going to be responsible for this other amount.

But it's really difficult for patients to make those comparisons on price
because the payment systems are outdated and ambulatory surgery centers are
not paid on the same type of a payment system as the hospital. And it would
be a lot more transparent for the patient if they had a system that was
paid on the same type of a system.

THE PRESIDENT: Yes, apples to apples.

MS. HENDERSON: Apples to apples, and then they could make those
comparisons. We give them information, but I'm not sure that they can get
that same information across the health care system.

THE PRESIDENT: Right. And the reason why they can't yet is because you
happen to be on the leading edge of what is an important reform.

MS. WILENSKY: I think so.

THE PRESIDENT: Yes, it is. Well, so do the patients, more importantly. And
thank you for sharing that with us.

You happen to have a patient here.

MS. WILENSKY: I do.

THE PRESIDENT: You've known Gail before?

MS. WILENSKY: Gail Zanelotti was a patient at our center, and I think
she'll tell you that probably it was a more convenient and comfortable and
patient --

THE PRESIDENT: You're not putting words in her mouth are you? (Laughter.)

MS. WILENSKY: No, no. But I bet she would tell you that. (Laughter.)

MS. ZANELOTTI: It was more convenient and comfortable. (Laughter.)

THE PRESIDENT: It was? Very good. (Laughter.)

MS. WILENSKY: See? (Laughter.)

THE PRESIDENT: You were diagnosed with what?

MS. ZANELOTTI: With bilateral breast cancer in October. And I had several
procedures performed at the Surgical Center of Baltimore. And they treated
me as if I were the main event. That's how I felt -- socially, emotionally,
physically. The whole gamut was covered. And I chose the surgeon first for
quality, and then went on to find the pricing and everything else through
them, which they were very transparent about. It was a very positive
experience. And I'm still in communication with them because -- through the
reconstructive process. And I would do it the same way again.

THE PRESIDENT: And so how does -- I mean, so you're the consumer. You walk
in, obviously, pretty well traumatized to a certain extent. You've got this
horrible disease that's attacked you. And you come to them, and they -- and
you're asking what questions?

MS. ZANELOTTI: I saw the surgeon that night, and I think we were there at
10:30 p.m. at night.

THE PRESIDENT: Oh, great.

MS. ZANELOTTI: I mean, it's amazing how dedicated some of these doctors
are. And then they take you through the process of different diagnostic
steps that you have to take. And, really, you see how curable things can be
if it's caught early. And I was very lucky to be able to be faced with
step-by-step approach to get back to my journey of full health.

THE PRESIDENT: Good job. Congratulations.

MS. ZANELOTTI: Thank you.

THE PRESIDENT: You've got that sparkle in your eye, you know. (Laughter.)

MS. ZANELOTTI: Thank you. Very lucky.

THE PRESIDENT: And so I appreciate it. It's an interesting -- the
transparency reform is going to take place in both large entities and
smaller entities, because consumers shouldn't be restricted to shopping
only in a large entity or a small entity. "Shopping" isn't the right word,
but you know what I mean -- in other words, out there looking for the
procedure that fits their needs at the right cost and the right price.

It almost doesn't matter if we have transparency if consumers, however, are
not in a position to make decisions. In other words, if somebody is making
the decision for you, transparency only matters to the decider. And so
Bruce is with us today -- Bruce Goodwin. He's an HSA owner.

Bruce, describe HSAs -- well, first of all, tell us what you do.

MR. GOODWIN: My company manufactures computer plate technology for the
graphic arts printing business.

THE PRESIDENT: How many employees?

MR. GOODWIN: We have 20 employees. We're a small company.

THE PRESIDENT: Yes. By the way, two-thirds of new jobs in America are
created by small businesses. And if a small business can't afford health
care, it's pretty likely they're not going to be aggressive in expanding.
And I presume you have some health care issues.

MR. GOODWIN: Well, I'm here as an employer who is concerned about health
care costs for sure, and a strong advocate of health savings accounts. I'm
a firm believer that for employers, health savings accounts is probably the
best weapon we've got in the battle of these rapidly escalating costs. And
I'm very much hopeful, and I appreciate very much your leadership in trying
to help strengthen the health savings accounts.

THE PRESIDENT: Yes, we'll talk about it in a minute. So tell people what a
health savings account is. This is kind of a foreign language to everybody
but the 3 million people who own one. It's just a new product. It's just
beginning to happen.

MR. GOODWIN: Well, I will say that, again, I'm an employer who has
implemented a health savings account, and I'm a participant in that
account. So speaking as an employer I can say that over the past two years
we have saved tens of thousands of dollars against what we would have paid
for our preferred provider plan had we continued that plan. So from that
aspect, we're quite pleased as an employer.

As a participant, I'm very pleased to see these dollars accumulating in my
account that I know that I can use to help decide what I need to do with my
health care dollars. But it makes transparency an even bigger issue,
because now that I've got this money, how do I go spend it in the best way?
So transparency is a very important issue as we look forward

THE PRESIDENT: An insurance plan with a health savings account is a
high-deductible catastrophic plan coupled with a tax-free health savings
account to pay routine medical costs up to the deductible. That's the way
they're structured now. Many employees -- I was at Wendy's yesterday;
Wendy's has now got 9,000 employees using health savings accounts. The
company pays for part of the premium, as well as the contribution into the
cash account to be paid by the customer for routine medical expenses.

If you don't spend all your money in your cash account, you can save it
tax-free, and roll it over to next year, and then you contribute again.
Wendy's premiums rose this year, I think, at less than 2 percent -- maybe
even less than 1 percent, if I'm not mistaken. And they were increasing at
double-digit rates -- I hope I'm not exaggerating -- they were going up
quite dramatically, let me put it to you that way. And now their premiums
were significantly lower. And the savings enabled them to put additional
money into their employees' accounts, additional contributions.

It's an interesting concept, because all of a sudden it puts an individual
in charge of health care decisions. There's an incentive, by the way, for
people to make rational choices about what they consume -- like, if you
don't smoke and drink, it's more likely you'll stay healthy and not spend
money in your account. If you exercise -- I'd strongly urge mountain biking
-- (laughter) -- it helps you stay healthy. And by staying healthy, you
actually save money. There's a remuneration for good choice.

And what Bruce is saying is that it has helped his business afford health
care. It has helped a lot of small businesses. If you're a small business
owner, please look into health savings accounts for the good of your
employees.

Interestingly enough, about a third of those who've purchased the new
health savings accounts were uninsured. Many of the uninsured in America
are young people, kind of the bullet-proof syndrome -- you're never going
to get sick, so, therefore, why buy insurance. Now there's an incentive to
buy insurance because it means you can save tax-free.

And so Bruce has used -- and he reports that he's able to better control
his costs, which is really important for the small business sector. And
it's also important for the large business sector to say to their
employees, here is something that's really beneficial for you and your
families because when -- you save the money, it's your money. Savings in
health care doesn't go to a third party entity, it goes to the consumer.
It's a new concept that's just coming to be.

In order for it to work, there has to be transparency. How can you expect
somebody to make rational decisions in the marketplace if they don't see
price and quality? It's going to be a very important -- what we're talking
here is a very important reform to really fit into a -- making sure the
private medicine aspect of our medical system remains the center of
medicine.

There's a debate here in Washington about who best to make decisions. Some
up here believe the federal government should be making decisions on behalf
of people. I believe that consumers should be encouraged to make decisions
on behalf of themselves. And health savings accounts and transparency go
hand-in-hand.

There are some things we need Congress to do to make health savings
accounts work even better than they are. One is to make sure that one's
contributions into the health savings account is -- can be -- will be equal
to the deductible, plus any co-pays that may have to be made. In other
words, we shouldn't cap the contribution, cash contribution where it is. It
needs to be raised.

Secondly, we need to make sure the tax code treats employees in large
companies and employees in small companies equally when it comes to
purchasing health savings accounts. And, thirdly, and a key component of
making sure health savings accounts works, that addresses one of the real
concerns in our society, and that is people changing jobs but fearful of
losing health care as they do change jobs is to make sure health savings
accounts are portable in all aspects, a health care plan that encompasses
health savings accounts. Today the rules enable one to take with them the
cash balances in their health savings accounts, but not the insurance in
their health savings accounts. In order to make these plans truly portable,
so as to bring peace of mind to people, we've got to make sure that health
savings accounts are genuinely portable accounts.

I look forward to working with Congress to strengthen, not weaken, but
strengthen these very important products that puts the doctor and the
patient in the center of the health care decision. Today, we've heard some
interesting, innovative ideas that are taking place from the insurance
industry, to the providers, to the federal government. And we will continue
to implement transparency. And it's just the beginning. And I predict that
when this -- as this society becomes more transparent, as the consumers
have more choice to make, you'll see better cost containment. And as we're
able to contain costs, we achieve some great national objectives: one, is
to make sure health care is affordable and, two, make sure it's available.

I want to thank you all for coming to join us. It was an interesting
discussion. I appreciate your time. God bless. (Applause.)

END 1:58 P.M. EST

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