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CNN LIVE EVENT/SPECIAL

Health Care Summit

Aired February 25, 2010 - 12:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Let's assume there were no rules there, there are no protections for the woman who's got breast cancer. They go in to New York. They offer pretty cheap insurance to everybody who's healthy.

They don't offer the same insurance to people who aren't so healthy or have pre-existing conditions. They drain from New York all the healthy people who are getting cheaper rates. But now, suddenly, everybody left in New York be who doesn't qualify for that cheaper plan is in a pool that's sicker, older, and their premiums go up.

So what we've said is, well, if we can set a baseline, then you can have interstate competition but it's not a race to the bottom. Rather, everybody's got some -- some basic care.

Now, these are legitimate arguments to have, but I just want to point out that this issue of government regulation, which we're going to also be talking about with respect to insurance, is very different than the way this has been framed during the course of the debate over the last year, which is government takeover of insurance.

This is not a government takeover of insurance. What it is, is saying let's set up some baselines and then use market principles, the private sector and pooling, in order to make sure that people get a better deal.

So, Jim, and then what we're going to do is we're just going to move on to the next topic, but anybody who wants to pick up on what we've just talked about, obviously, can return to that as well.

REP. JIM CLYBURN (D-SC), HOUSE MAJORITY WHIP: Thank you very much, Mr. President.

Mr. President, leaders and members of the Congress, there are two cost containment issues that I think have not been sufficiently vetted here today.

Let me set this up by sharing with you a conversation I had on yesterday with the administrators of the Dillon McLeod Health Care Center in Dillon, South Carolina, a little town, Mr. President, you've become quite familiar with.

(LAUGHTER)

They told me that their emergency room activities have doubled over the past several years. And they were looking for some assistance to expand the size of that emergency room.

When I began to question them as to why, in this small county -- not in my district -- they had had such a doubling, what it turns out is that they told me that 31 percent of the people that they treat in that emergency room are not there for emergencies. They are there for primary care.

Now, they said to me that some of these people do not have health insurance. But many of them do have health insurance. But they cannot afford the $1,500 to $2,000 deductibles that they would have to pay if they were to go to a private primary care provider.

So they're now treating people who have got employer-based health care that they cannot use. They're holding out for some catastrophic event. But they need some assistance.

Now, I think that, no matter what kind of plan we develop, there will be many people left uncovered, and we need a safety net for those people.

I believe that the one way to provide that safety net and to take care of all of those people who may be uncovered and those people who have $2,000 deductibles with primary care is for a significant expansion of community health centers.

And we have not spoken about that here today, but I know that your proposal, Mr. President -- I know that both the House and Senate plans have that in them, and I do believe that that is very, very important. We have more than a 40-year experience with these health care centers, and I do believe that, no matter what we do, there ought to be a significant expansion of those health care centers.

Secondly, Mr. President, a lot of other things have been said about what I have on this paper, but one other thing I would like to mention, and it has to do with people who really cannot navigate the system, people who work very hard; they know what they need for themselves, but I was reminded of that when we talked about putting together restaurant owners who will design plans for their members.

I would hope that, when we start designing plans for the members of small businesses, let's keep in mind that the employees of those small businesses are not negotiating these plans. They are at the mercy of the small-business owners. And the question is whether or not the plans are sufficient that they will not fall into the same category that these people with $1,500 to $2,000 deductibles.

Finally, Mr. President, this morning I was doing one of these call-in shows on C-SPAN. A gentleman called in, and he was very, very emotional. He said to me that he was getting ready to have transplant surgery, but he was told by the hospital that, because he's on Medicare, that his post-operative treatment was going to be limited to three years. After that, he'll have to find some way to pay.

This man was very emotional today. What we're doing here fixes that, and I do believe that we ought to really be honest with the American people. We talk about what we are doing with Medicare. We're trying to make sure that Medicare is there for that man and so many others who will find themselves in his position.

With that, I yield back, Mr. President.

OBAMA: OK. I think this has actually been a very useful conversation. What I'm going to do is move on to the next topic, but maybe, after we break for lunch and come back, I want to go through some areas where we decided we agreed -- I know the abuse is a good example; some areas where we still disagree.

One thing, John, you shook your head when I said that people would be able to choose the better plan, because the notion was, well, people are mandated.

Actually, any insurance that you currently have would be grandfathered in so you could keep. And so you could decide not to get, in the exchange, the better plan. I could keep my Acme insurance, just a high-deductible catastrophic plan. I would not be required to get the better one. If I chose to get the better one, it would be 14 percent to 20 percent cheaper than if I were going into the individual market. I just want to clarify that.

SEN. JON KYL (R), MINORITY WHIP: Well, Mr. President, if I could clarify, that's for a very limited period of time, number one.

Secondly, the incentives are set up so that employers would drop you from their coverage because it's cheaper for them to pay the fine than to continue to pay the insurance. So they wouldn't be able to keep what they have.

And third, there are still mandates in the legislation as to what you can do with what you have, such that it doesn't end up being the same coverage.

So with all due respect, I disagree. And it's just a fundamental disagreement between us. Does Washington know best about the coverage people should have? Or should people have that choice themselves, pay a little less, get a little less coverage, or pay a little more and get more coverage?

OBAMA: Can I just say that, at this point, any time the question is phrased as, "Does Washington know better," I think we're, kind of, tipping the scales a little bit there, since we all know that everybody is angry at Washington right now.

I think -- I think the -- so it's a -- it's a good way of framing -- it's a good talking point, but it doesn't actually answer the underlying question, which is do we want to make sure that people have a baseline of protection?

And this topic of the insurance market reforms, I think, is a good additional example of what may be philosophical differences but what we may have in common.

Rather than go through the problem, because I think everybody understands, out there, the issue of people with pre-existing conditions not being able to get insurance, people coming up with -- bumping up against lifetime caps and suddenly thinking, as a family I met in Colorado -- they thought their child was covered; suddenly they hit the lifetime cap and they started having to scramble to figure out how they pay the additional costs.

We with all are familiar with these examples. I just want to go through areas where I think we agree on insurance reforms, or at least some Republicans and some Democrats agree.

I think we agree on the notion that you can't just drop somebody if they've already purchased coverage. Looking at your bill, John, the idea that you ban rescissions -- we agree on the idea of extending dependent coverage to a certain age.

Some people say up to 25, some people say up to 26, but we basically agree on that concept.

We agree on no annual or lifetime limits.

We agree philosophically that we want to end the prohibition on preexisting conditions. I think the thing we're going to have to talk about is how do you actually accomplish that. There may be a disagreement as to whether you can do that without making sure that everybody's covered, but that's something that we can talk about.

In addition, though, there are some other insurance reforms that have been proposed by the House and Senate in their legislation that I think we should explore, and maybe we can narrow the gaps there and come up with some -- even a longer list of areas that we agree on.

So, what I do is, since I want to make sure that Mitch doesn't give me a time clock tally again, let me first go to Mitch. And I don't know who wants to make the presentation with respect to insurance reform.

REP. JOHN BOEHNER (R-OH), HOUSE MINORITY LEADER: Mr. President, I'd like to yield to Dr. Boustany to (INAUDIBLE) this conversation about insurance reform.

REP. CHARLES BOUSTANY (R), LOUISIANA: (INAUDIBLE) Leader Boehner.

And thank you, Mr. President.

I come at this as a physician, a cardiovascular surgeon, with over 20 years of practice doing open-heart surgery, dealing with patients who have come to me with very, very challenging cases at very difficult times in their lives.

And along with my colleagues Dr. Coburn and Dr. Barrasso, we bring a wealth of experience in dealing with insurance companies and all these everyday problems that so many American families face.

We all agree -- we all agree -- that we need insurance reform. There's no question about it. The question is how do we do it.

Now, we've all been through a long year -- town hall meetings, telephone calls, e-mails, it goes on and on. And one thing that has become very clear, the American people have spoken out very loudly and very clearly, they want us to take a step back and go step by step with a common-sense plan that really brings the cost down for American families and small-business owners. They want insurance companies to treat them just like they treat big labor unions and large companies. It's been a resounding message we've heard over and over.

So how can we achieve all this? Well, we've talked about some of it. I think one of the things we ought to really look at is how do you simplify, streamline and standardize all the paperwork that's involved? Because I can tell you, as a doctor, and my two colleagues who are physicians will know that it takes you away from patient care. It interferes with the doctor-patient relationship. It runs up cost in medical practices. And it's a real issue.

So, I believe -- I think we can all agree on that. We need to -- we need to address that issue.

A second area is, how do you really promote choice and competition? We've all talked about it, and I think we've had a lot of discussion already on those issues.

We put forth a plan earlier in the year, during the debate, that actually the Congressional Budget Office showed that it brings down the cost of premiums up to about 10 percent. And, actually, for individuals seeking -- and families seeking insurance in the individual market, those cost savings could even be higher.

As opposed to the bill we have here, where we've had some discussion already, and Mr. Camp has already outlined, as well as Mr. Kyl, that this bill would actually raise premium cost.

We -- we've talked about small-business health plans. You know, again, I ran a small business. It was a medical practice. And when I wanted insurance, when those premiums were going up in double digits every year, I'd call an insurance agent. They would come in. And we had very limited choice. Very limited. And the costs kept going up.

Small-business health plans is one way to really deal with this and allow for pooling. And where our big disagreement is, frankly, it's with how you do it. And if you create a plan with exchanges that are overly restrictive, it really doesn't -- it defeats the purpose.

And I believe we can have faith in the American public to figure out, if it's transparent enough, what's their best deal. What's the best deal for a small-business owner or a family in this sort of arrangement?

WOLF BLITZER, CNN ANCHOR: All right. Let's break away for a moment from Dr. Charles Boustany. He's one of the Republican physicians who is actually there at the Blair House Health Care Summit. He is making the case, obviously, for the Republicans.

Our chief medical correspondent, Dr. Ali Velshi -- excuse me, Dr. Sanjay Gupta -- has been watching all of this unfold with us as well. Ali Velshi is doing some fact-checking for us. We're going to get to him shortly.

But Sanjay, tell us what you've been seeing. You've been seeing some substantive discussion here on key issues.

DR. SANJAY GUPTA, CNN CHIEF MEDICAL CORRESPONDENT: Yes. You know, and it's interesting.

For the most part, it's been pretty civil, but it's also been unyielding. I think people, the things that they walked into the room agreeing on, they still agree on, and the things that they don't agree on, they still don't agree on. Sort of the core issue which has been raised a couple of times now about, who do you trust? That's what Senator Kyl brought up and President Obama addressed, but do you trust government more or the private sector more, do you trust the state more or the feds more? Do you trust your doctor or do you trust government to be able to help manage your health care?

I also think that, you know, some of the -- there's been a lot more substance over the past hour or so, but there's still a lot of details necessary. A quick couple of examples.

You know, Senator Alexander started off by talking about the fact that everyone agrees that there should be no discrimination based on pre-existing conditions. But if that happens, obviously, people are not being discriminated against, you're going to need a lot more coverage. A lot more people are going to start to be able to get insured.

How are those people going to be taken care of under the Republican plan that doesn't account possibly to be able to cover all those newcomers? So that is something that really needs to be addressed.

Also, with regard to tort reform, Wolf, as you know, this hasn't really been talked about very much, but it is one of the key components of the six-point plan the GOP is sort of putting forward. Senator -- I'm sorry, President Obama addressed that by saying the secretary of health, Kathleen Sebelius, is working on that.

We actually called them in the interim while we're sitting here, Wolf, and in fact what's happening at the Department of Health, they are asking for grants to states, localities and health systems to try to come up with an alternative to our current medical liability system. So, you know, these sort of details are going to need to be worked out.

It costs anywhere between $700 billion to $800 billion a year, according to some studies, for practice of defensive medicine. So these are big issues being talked about in broad brush strokes so far, but those details over the next couple of hours are going to be very important -- Wolf.

BLITZER: But did that sort of ring true to you, Sanjay, when Tom Coburn, the Republican senator from Oklahoma, himself a physician, said American taxpayers could save about 15 percent, maybe even 20 percent, on health care on an annual basis if the government eliminated fraud and did something about litigation, what's called tort reform?

GUPTA: Well, you know, it's interesting. Senator Coburn's numbers, you know, he says it's about $80 billion of fraud, waste in Medicare every year. There are lots of different studies.

You know, I think most of the numbers are not that high, although, admittedly, some of the numbers get into the $60 billion, $70 billion range, possibly the cost of fraud. But what those numbers are talking about was sort of the medical system as a whole and not parsing it out specifically to Medicare and to other particular providers. So, I think it's a little bit hard to make that case.

With regard to tort reform specifically, you know, what happens is the amount of money paid out in lawsuits is a relatively small amount of money. That case has been made. Probably two percent or three percent of the health care budget. But the sort of trickle-down effect, the effect on doctors, nurses, all health care professionals, in the way they practice medicine, changes dramatically because of the fear of lawsuits.

And that number, again, as far as the cost of defensive medicine, they say could be between $600 billion and $800 billion a year. So, collectively, perhaps, Wolf, but again, the devil's in the details there.

BLITZER: And I think as this meeting goes on over at Blair House, you'll hear the president himself say he's open to tort reform, he's open to some changes in the way the system works as far as lawsuits are concerned.

Thanks, Sanjay. We'll get back to you.

Congressman Joseph Cao, Republican of Louisiana, is joining us right now. He's the only Republican who voted with all the Democrats -- all those Democrats in the House in favor of health care reform.

You still support that? Do you have some second thoughts, Congressman?

REP. ANH "JOSEPH" CAO (R), LOUISIANA: Hi, Wolf.

I have conveyed to the White House that at this point, I cannot support the agenda being pushed because of the federal funds for abortion. That was one of my biggest issues in the original House bill. And once the Stupak amendment was passed in the House to restrict federal funding for abortion, I was able to support the House bill.

But the same language is not in the agenda that's being pushed by the president. And unless the abortion language changes, I cannot support the program.

BLITZER: You believe there's any room for a compromise agreement between the Democrats and the Republicans, or is it too late for that, Congressman?

CAO: Are you talking about the overall bill, or is this on the abortion language?

BLITZER: No, no, no. On the abortion language, I understand your principled decision. You like the way the House compromised on abortion, the language that was included in the House legislation. It was changed in the Senate. And you say if they include that Senate language, you can't go along.

But generally speaking -- put on your observer hat as an analysis -- can there be a compromise, an agreement between the Democrats and Republicans in the House, on health care reform?

CAO: Just from an objective standpoint, it's going to be extremely difficult, because the differences between the two parties are so vast. But I'm still very hopeful, and I'm still -- I hope that at the end of the day, that we can come up with a reform package. But the gaps between the two parties are just too vast for us to bridge.

BLITZER: Candy Crowley and John King have a quick question for you, Congressman.

Go ahead, Candy.

CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT: Congressman, I'm curious to know, because what we are hearing is a vote in the House could be problematic for the Speaker, simply because of votes like yours that have changed, others that have left the House. So, I'm wondering what -- have you been under pressure from either the White House or Speaker Nancy Pelosi? What is the intensity of getting this passed now?

CAO: I have not been approached by the Speaker. I have spoken once to the White House legislative affairs, but there has not been much pressure putting on me with respect to the health care vote.

But I believe -- I strongly believe that the health care vote in the House will depend on the abortion language. At this point, there are about 12 pro-life members who will not vote for the bill because of the present abortion language that's being proposed. Unless that language changes, we cannot support the bill.

JOHN KING, CNN CHIEF NATIONAL CORRESPONDENT: Forgive me, sir. This is John King.

Give us some perspective. As we watch this remarkable event play out in Washington, health care has been a subject of debate, a rather partisan debate here in Washington now for much of the last year.

What about when you go home in this midterm election year? You're a Republican, you represent a very Democratic district, you have a tough campaign anyway. When you go home in the district, are people telling you they want health care discussed, they want it debated, and they want health care reform this year? And obviously they would have differences of opinion. Or do they think Washington has its priorities out of whack, and whether it's the economy or jobs or something else, it should be taking more of the time and effort? CAO: Well, the majority -- a good percentage of my people in the second district, they lack health care. So the overwhelming consensus is that we need health care reform that will be beneficial to everyone in the country. So, I hope that we do have a health care package, but in my district it's very much different from the other districts in the country.

My district has been ravaged by Katrina. We've been lacking adequate health care for four and a half years now, and we are working very hard to address the issue. So, the consensus from my people is very much different from the -- from the feelings of the general public in America.

BLITZER: Congressman Cao, your district -- just correct me if I'm wrong -- is William Jefferson's old district. He's the congressman who had almost $100,000 stashed in his freezer and is now serving time in jail. Is that right?

CAO: Well, actually, he is appealing the conviction, and the judge has allowed him to remain free during appeal. So, he's not in jail yet.

BLITZER: All right. Well, he is your predecessor in that district.

Congressman, thanks very much. It's a pretty Democratic district.

Congressman Joseph Cao making the case he can't support this legislation if it doesn't include the very tight language on abortion that was in the House-approved bill.

We'll continue our coverage of the Blair House Health Care Summit right after this.

(COMMERCIAL BREAK)

BLITZER: Nearly two and a half hours after the health care summit started, John McCain is now speaking.

SEN. JOHN MCCAIN (R), ARIZONA: -- as provisions of this legislation that was particularly offensive was the carve-out for 800,000 Florida seniors exempt from cuts in Medicare Advantage program. There's 330,000 seniors under Medicare Advantage in my home state of Arizona. They're deeply concerned about that. They're deeply concerned about carve-outs for Vermont and Massachusetts, Hawaii, Michigan, Connecticut -- $100 million for a hospital in Connecticut. Why -- why should that happen? They don't understand it.

And at the town hall meetings that I conducted all over my state, people are angry. We promised them change in Washington and what we got was a process that you and I both said we would change in Washington. So then we got into the special interests, whether it be the Hospital Association or the AMA or others. And one of them that was particularly egregious, and I won't go through the whole list, was PhRMA. PhRMA got an $80 billion deal an in return for which they ran $150 million worth of ads in favor of, quote, "health reform." Their over $2 million a year lobbyist was here at the White House and was reported to say in the media "a deal is a deal."

And part of that deal was that there would not be competition among pharmaceutical companies for -- for Medicare patients. The other, well, among others, was that the administration would oppose drug re-importation from Canada, a proposal that you supported in the United States Senate.

OBAMA: John, if I could say --

(CROSSTALK)

MCCAIN: Could I just finish, please?

And then at Christmas Day, I believe it was Christmas, the majority leader said, quote, "A number of states are treated differently than other states. That's what legislation is all about. That's compromise." "Compromise" is not the word for that.

So when my constituents and Americans now who overwhelming reject this proposal say go back to the beginning, they want us to go back to the beginning. They want us not to do this kind of legislating. They want us to sit down together and do what's best for all Americans, not just for some people that live in Florida or happen to live in other favored states. They want a uniform treatment of all Americans.

So I hope that that would be an argument for us to go through this 2,400-page document, remove all the special deals for the special interests and favored few, and treat all Americans the same under provisions of the law so that they will know that geography does not dictate what kind of health care they would receive.

I thank you, Mr. President.

OBAMA: Let me just make this point, John, because we're not campaigning anymore. The election's over.

(CROSSTALK)

MCCAIN: Well, I -- I'm reminded of that every day.

(LAUGHTER)

OBAMA: Well, I -- yes. So, the -- we can spend the remainder of the time with our respective talking points, going back and forth. We were supposed to be talking about insurance.

You know, obviously, I'm sure that Harry Reid and Chris Dodd and others who went through an exhaustive process, through the both -- the House and the Senate, with the most hearings, the most debates on the floor, the longest markup in 22 years on each and every one of these bills would have a response for you.

My concern is is that if we do that, then we're essentially back on Fox News or MSNBC on the split screen just arguing back and forth. So, my hope would be that we can just focus on the issues of how we actually get a bill done.

And this would probably be a good time to turn it over to Secretary Sebelius who --

MCCAIN: Could I just say, Mr. President, the American people care about what we did and how we did it --

(CROSSTALK)

MCCAIN: -- and I think we ought -- and that's a subject that I think we should discuss. And I thank you.

OBAMA: They absolutely do care about it, John. And I think that the way you characterized it obviously would get some strong objections from the other side.

We can have a debate about process or we can have a debate about how we're actually going to help the American people at this point. And I think that's -- the latter debate's the one that they care about a little bit more.

So, Kathleen, why don't you just address some of the issues related to insurance reform? There's some agreement here, but I know that on the Republican side, there are a couple of concerns about that issue of rate review, the issue of setting up some benchmark standards that insurance companies have to abide by. Some people may think that those have been a little bit too aggressive.

You've been both a governor as well as an insurance commissioner. Maybe you can talk a little bit about -- about what you've seen at all those different levels and how you think we can best move forward to protect American families.

KATHLEEN SEBELIUS, SECRETARY OF HEALTH AND HUMAN SERVICES: Well, thank you, Mr. President. And I know there are lots of people who want to comment on these topics, but I don't think there's any question and I think there's a lot of agreement that the current insurance market really fails way too many people.

It is a system that is not a market for about 40 million Americans who are either in an individual policy or in a small group policy, have no choice. There is no competition.

According to the American Medical Association in their study yesterday, 99 percent of the market in metropolitan areas, 75 percent of the markets across the country are very concentrated -- which means they're monopolies, they're not markets. So we've got a trap.

And I think the rules allow people to be locked out from the front end if you've got preexisting conditions, allow people to be thrown out with a stop on benefits during the course of a treatment, or when your policy expires and you're supposed to renew, you're dumped out of the market, or to be priced out, which is going on across this country.

There's been a highlight of a couple of rates, but double-digit rates across the country on top of double-digit rates on top of double-digit rates, and people have no choices.

So the common areas, I think, of agreement -- high-risk pools. There are lots of states across the country running high-risk pools. As an insurance commissioner, we ran the high-risk pool in Kansas. It is a strategy that's been in place for almost 30 years in many states; 200,000 people total in the entire United States are in high-risk pools. Because they're so expensive that they really don't offer anything -- because when you put all the sick people together and you say, "OK, you get to buy a policy and you get no help with that policy," it is a death spiral.

You will always have the highest costs and, on top of that, the highest costs, and you've got the sickest people who are already paying the highest costs for treatment.

They don't work very well. They are a stop-gap measure that the House and Senate have proposed to get people from here to a new market.

I think what -- what -- the exchanges have a lot in similarity with the health plans that have been talked about by the House and Senate. There's a big difference. And it's not a Washington difference; it's a state difference.

The state insurance commissioners across this country have unanimously opposed health plans for decades. And they feel that it takes people -- it isn't the pooling that's objectionable. It's the fact that there is no consumer protection, that there is no ability to apply common-sense rules. And we had the drive-by deliveries in Kansas, where people were being kicked out of the hospital 18 hours after having a baby to save money, only to be remitted with jaundice and to be readmitted with dehydration. It's not a particularly good idea.

So getting rid of preexisting conditions, getting rid of caps on yearly benefits and long-time benefits, allowing kids to stay on plans are ideas that have been accepted by both.

Setting up a new marketplace. Giving small business owners and individuals choice and competition in the private sector, but making the private sector operate on a different set of rules, including having some loss-benefit analysis. How many of those dollars -- you heard Senator Coburn eloquently talk about the 30 cents of every dollar that goes to pay for expenses other than medical costs. A loss benefit analysis, a medical ratio would do just that.

How many of your dollars are you actually spending on provider care, on prescriptions, on treatments, and how much is going to overhead and CEO salaries and advertising, to try to get a handle on rates. Having some rate review. Having some transparency and some opportunity to have people make choices and make companies compete with one another and not separate the marketplace.

I think the most dangerous part of the system right now is having people -- having insurance companies pick and choose who gets coverage and who doesn't, based on your health condition. It's a lot cheaper to insure people who promise never to get sick. I watched it as insurance commissioner.

But segregating that market is not insurance. It's not pooling a risk.

And I think your proposal, Mr. President, gets back to the fact that there would be a pool. There would be an opportunity to pool that risk and have the people have the kind of negotiating powers a governor -- and, like Senator Alexander, I am a former governor. We both ran our state employee health pools, I don't know about Tennessee, but in Kansas, that was --

BLITZER: All right, let's break away briefly. Kathleen Sebelius, the secretary of the health and human services, making the case on behalf of the Democrats health care reform legislation.

Candy Crowley, there was some fireworks just a little while ago when Senator McCain was finally making his presentation and the president tried to cut him off even as he was speaking. And at one point President Obama saying to his former challenger for the presidency, John, we're not campaigning anymore.

CROWLEY: Right.

BLITZER: And that --

CROWLEY: Old home week on the campaign trail.

BLITZER: Yes, that -- and you could see in the body language from the president, he was getting irritated by what he called Republican talking points.

CROWLEY: I think there have been several times when the president looked impatient, shall we say. Like he wanted to kind of move it along.

Look, some sharp elbows have been thrown in here. But the tone has been -- you know, you don't notice them unless you're looking for them, because they've all kept the tone quite civil. But I think, in the end, if we're going to look at the bottom line, however many hours into this we are, nothing has changed.

BLITZER: Stand by for a moment, because Eric Cantor, who's the number two Republican in the House, the minority whip, he's got the props in front of him. The Democrats' legislation.

REP. ERIC CANTOR (R-VA), HOUSE MINORITY WHIP: And when the speaker cites her letters from the folks in Michigan and the leader talks about the letters he's received, Mr. Andrews his, all of us share the concerns when people are allegedly wronged in our health care system. I mean, I think that is sort of a given.

We don't care for this bill. I think you know that. The American people don't care for the bill. I think that we demonstrated, you know, in the polling that they don't.

But there is -- there is a reason why we all voted no. And it does have to do with the philosophical difference that you point out. It does have to do with our fear that if you say that Washington can be the one to define essential health benefits, there may be a problem with that.

And that's the language in the Section 1302 of this bill, that it says that the secretary shall define for people what essential health benefits are.

But let's -- in the spirit of trying to come together, let's try and say maybe if -- if we assume that Washington could do that, could really take the place of every American and decide what is most essential, what -- what would be the consequences? And that's also where we have a big difference, in this bill, and what would happen.

First of all, the costs -- and Jon Kyl laid out the tremendous costs and the nearly $1 trillion of this bill. And I don't quite know, because CBO said it couldn't assess how much your additions would cost to it, but we do know that there are plenty of taxes on income. Now you suggest investment income should be taxed. We have additional taxes on medical devices and the rest.

What is the consequence of that?

We know there are consequences that small businesses will feel because of the impact on job creation. But also, Mr. President, when we were here about a year ago, across the street, you started the health care summit by saying one of the promises you want to make is that people ought to be able to keep the health insurance that they have.

Because, as we also know, most people in this country do have insurance, and an overwhelming majority of people do like that coverage; it's just too expensive.

Well, the CBO sent a letter -- I think it was to Leader Reid -- about the Senate bill. And in that letter, it suggested that between 8 million and 9 million people may very well lose the coverage that they have because of this, because of the construct of this bill. That's our concern.

And so, as we are in -- as we are in the market, in the section of this discussion about health insurance reform, I know, Mr. President, that you have suggested strengthening oversight of insurance premium increases, because we want to make sure that there aren't excessive insurance premium increases that take place.

The problem is, when you start to mandate all of the essential benefits, there are going to be some insurance premium increases. None of us really want to see them, but if you stop them, who's going to pay for it?

Well, then we get back to the fact that businesses won't be able to pay for it, and people are going to lose their coverage.

So I guess my question to you is, in the construct of this bill, if we want to find agreement, we really do need to set this aside. And we really do need to say, OK, you know, the fundamental structure is something we can't agree on, but there are certainly plenty of areas of agreement.

And -- because I don't think that you can answer the question in the positive, to say that people will be able to maintain their coverage; people will be able to see the doctors they want in the kind of bill that you're proposing.

OBAMA: Well, let me -- since you asked me a question, let me respond.

The 8 million to 9 million people that you refer to that might have to change their coverage -- keep in mind, out of the 300 million Americans that we're talking about, would be folks who the CBO, the Congressional Budget Office, estimates would find the deal in the exchange better, would be a better deal.

So they -- yes, they would change coverage because they've got more choice in competition. So let's just be clear about that, point number one.

Point number two, you know, when we do prop like this, stack it up and you repeat 2,400 pages, et cetera, you know, the truth of the matter is -- is that health care's very complicated. And we can try to pretend that it's not, but it is. Every single item that we've talked about on the Republican side, if we wanted to exhaustively deal with fraud and abuse, would generate a bunch of pages.

So I point that out just because, you know, these are the kind of political things we do that prevent us from actually having a conversation.

Now, let me -- let me respond to your question. We could set up a system where food was probably cheaper than it is right now, if we just eliminated meat inspectors and -- and we eliminated any regulations in terms of how food's distributed and how it's stored.

I'll bet, in terms of drug prices, we would definitely reduce prescription drug prices if we didn't have a drug administration that makes sure that we test the drugs so that they don't kill us.

But we don't do that. We -- we make some decisions to protect consumers in every aspect of our lives. And we have bipartisan support for doing it. Because what we don't want is a situation in which suddenly people think they're getting one thing, and they're getting something else; they're harmed by a product.

What Secretary Sebelius just referred to, which is not a Washington thing -- in fact, state insurance standards in many states are higher than anything that's done in Washington, is as a consequence of seeing consistent abuses by the insurance companies and people finding themselves helpless to deal with it.

Now, we can have a philosophical disagreement about how much insurance regulation is appropriate. What you've indicated to me, just based on the bills that I've seen, is you guys believe in some regulations. You already said you did. You believe in making sure that you can't just drop somebody with coverage.

Now, if you don't have a law there, let me tell you, that happens all the time. I've got a bunch of stories in here of folks who thought they had insurance, got sick; the insurance company goes back and figures out a way to drop them. I'm not making this up. I'm not trying to just add to the pages of that bill. It's in response to an actual problem, and you guys have agreed to it.

So, philosophically, at least, on a whole range of issues, you agree that we should have some insurance regulation. My suggestion had been that we try to focus on what are the specific regulations -- since we agree that there have to be some, what are the specific ones that you object to?

Now, let me just close by saying this. Pre-existing conditions is one that, theoretically, we all say we agree on. Theoretically, everybody thinks it's a bad deal if my wife's had breast cancer; I lose my job; I now try to buy insurance, and they say, well, you know what, if we're going to -- we can't cover you because your wife has a history of cancer. We all think that's -- that's a bad deal.

There are two options of -- two ways of dealing with that. One is what Kathleen raised, which is a high-risk pool. You could say, you know what, you can go in there and buy in a big high-risk pool.

And by the way, you could probably set up a high-risk pool without having as many pages in the bill. And it's an option that's been around for 30 years.

Here's the problem. What happens is the reason that all our rates, as members of Congress or as elected officials, are pretty low is we've got such a big pool. There are millions of federal workers. And as a consequence, any single one of us has cancer; any single one of us has a child with a disability, our costs are spread out over millions of people, and so all of us are able to keep our rates relatively low, even though, if any individual in that situation was trying to buy insurance, it would skyrocket.

That's the concept of pooling, is you get the healthy people and the young people alongside the not-so-healthy and the older people, but we're all kind of spreading our risks because each of us don't know, at any given time, what might happen. Maybe our kid's the one who gets diagnosed, heaven forbid, for something. And as a consequence, we insure ourselves by making sure that we're also insuring somebody else.

When you get into something like a high-risk pool, what happens is all the sicker, older people are in that pool. All the younger people -- they end up getting really cheap rates, and overall you could say, well, that's how the market works; it's a good thing; there's more choice. There's more choice for the young, healthy person but not for the person who, heaven forbid, got sick.

Now, on pre-existing conditions, we've got a similar situation. The challenge we have -- I'd love to just pass a law that said, insurance companies, you can't -- you can't exclude people based on pre-existing conditions.

The problem is, what they'll say to you is, well, you know what, what prevents somebody from not buying insurance until they get sick and then going in and just buying it and gaming the system?

So we've tried to respond to a difficult problem by saying, well, let's make sure everybody has some coverage. Without that, it's hard to do.

So I just wanted to respond to, yes, we've got a philosophical objection, but let's not pretend that any form of regulation of the insurance market is somehow some onerous burden that's going to result in terrible things happening to consumers. We --

(CROSSTALK)

OBAMA: -- that's a good thing.

CANTOR: Mr. President, if I could respond?

OBAMA: Please.

CANTOR: We, again, have a very difficult bridge to gap here, because I know that this is something that we don't want to look at.

But these are, as you say, the complexities of what this is about. But when you start to mandate that everyone in this country have insurance and you lay on top of that now the mandates that we all would like to see in a perfect world, there are consequences to that.

We just can't afford this. I mean, that's the ultimate -- that's the ultimate problem here, is in a perfect world everyone would have everything they want. This government can't afford it, businesses can't afford it.

That's why we continue to say, go step by step, try and address the cost, and we could ultimately get there. But we're asking that you set aside this mandated form of insurance -- this mandated form of health care regulation and let's go back to things we can agree on, without this trillion-dollar attempt here, that's all.

OBAMA: I think the cost issue is legitimate, and whether we can afford it or not, we'll be discussing that. And I think that's an entirely legitimate discussion.

(CROSSTALK)

BIDEN: Mr. President, can I have 10 seconds? Literally 10 seconds.

We don't have a philosophic disagreement. If you agree that you can't be dropped, there has to be dependent coverage, if there's no annual or lifetime cap, then, in fact, you've acknowledged that is the government's role.

The question is how far to go. So, this idea we have a fundamental philosophic difference, you're either in or you're out. (inaudible) the government can't do it, none of it, or they can do some (inaudible) how much.

OBAMA: The cost issue is legitimate. We're going to address that. I want to -

(CROSSTALK)

CANTOR: Mr. President, if I could just -- it's not -- it's the cost issue, but it's being driven by the fact that you've got in the bill, which I assume that your proposal supports, that the secretary define what a health benefit package should be.

OBAMA: Only in the exchange. Only as part of the pool that people who don't have health insurance would buy into.

If you're -- you wouldn't -- if you were working at a big company that already has a big pool, then -- but you know what? I want to -- I want to make sure, because, Eric, we're going to end up in a back- and-forth that cuts everybody else out. I've got on the Democratic side, a couple of people that want to speak, and there are probably some -- a couple Republicans. We're already over time. I've burned some of it. I apologize.

I'm going to go to Louise, then --

MCCONNELL: To Mike Enzi.

OBAMA: -- Mike Enzi. I'll go to Tom Harkin. And then go back to Dave.

So I've got five speakers, and I don't have a lot of time. Go ahead.

BLITZER: All right, let's digest what we just heard, because this is important stuff that's going on. There are going to be some more speakers. They're eventually going to take a little lunch break. The White House says they have a buffet lunch ready for all the participants. Then they'll resume. They're supposed to wrap up at around 4:00 p.m. Eastern, although I suspect it could go on longer than that. Lots to access right now.

Joe Johns, as you've been watching this unfold, it looks like the Republicans certainly showed up ready to play.

JOE JOHNS, CNN SENIOR CORRESPONDENT: Well, they should -- they did. And what's interesting is, you sort of see two steps forward, one step back. This is a kind of different dynamic that's going on in this room right now. The Republicans and the Democrats getting away now from sort of their talking points that we hear so much on Capitol Hill, from time to time, to actually sort of really talk turkey with the president. And then both sides will drift back into the traditional things that they say to get a sound bite. So, you'll sort of see that.

The other thing that's very interesting that I see here is this president, who has sort of been described as Mr. Spock to the American public, now you see him very engaged. You see flashes of anger from time to time.

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: He's a wonk (ph).

JOHNS: Right, you do. He's a wonk. All of a sudden you see a completely different Barack Obama than the one we see reading the teleprompter so much. And perhaps that's good for him in some ways, but

BLITZER: Because he is -- he is demonstrating, Gloria, a lot of expertise on a very complicated subject.

BORGER: His. He is. And he's -- he's very good on the substance. He's also good on the politics, because when the Republicans started framing the debate as, do you trust Washington or do you want to make your own choices, which is, of course, a very popular debate for them as we know from our polls. The president, you know, just got -- went back at them and said, no, no, no, it's not -- it's not that simple.

But having said that, I want to say the Republicans have been very effective today. They -- they really did came -- come to play, as you put it. They were very smart. They let the leaders sit back, the folks we know, whom some people might not like out there, the polarizing folks, and they let their rank-and-file kind of take over. They led with Lamar Alexander, very, very folksy. And they -- and they took on the substance of a very complex issue. Yes, John McCain brought it back to politics and the president brought it back to politics, but they really stuck to the substance of the -- of this issue and tried to get to the heart of it. And really, I thought, did a very good job.

DAVID GERGEN, CNN SENIOR POLITICAL ANALYST: Wolf, I want to respectfully disagree with the notion that this is an example of broken government on display. This seems to me the best conversation we've had about health care during the entire past year. It's extremely interesting. It's revealing of different positions. It shows the deep philosophical divides. There is -- there is -- we sometimes cannot get things passed on these big bills because there are these deep philosophical divides and it's important for the country to understand that.

On the politics of it, I must tell you, the dem -- the folks in the White House just must be kicking themselves right now, you know. They thought that coming out of Baltimore, when the president went in, was mesmerizing and commanding in front of the House Republicans, that he could do that again here today. And that that would revive health care, would change the public opinion about their health care bill and they could go on to victory.

Just the opposite has happened. The president has been strong. Many times he's made very effective points. He does not have a strong Democratic team behind him to carry the day.

BORGER: Right.

GERGEN: And the president came in here to make nice and say, how many areas of agreements are. The Republicans came in to bury this bill.

BLITZER: Yes, well, the president is being -- basically he's defending the Democrats. He doesn't have a whole lot of support, though.

GERGEN: He's on the fence. (INAUDIBLE).

BLITZER: Yes, and the Republicans did come in with a lot of expertise.

Hold your thoughts for just a moment. We want to take a quick break, continue our coverage right after this.

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