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GLORIA PENNER (Host): Let's move on to another subject and try to purge ourselves of those thoughts. It's President Obama's campaign promise to overhaul the healthcare industry and it appears to be a promise on which he will deliver. Congress has quickened its pace on revamping the system and it's possible that both houses will approve legislation before congress recesses in August. But this morning I read, John Warren, that congress's chief budget analyst criticized the proposals in congress, saying that they don't control costs and that they'll make the nation's financial situation worse. Should the president take the pressure off and give congress time to incubate their ideas, to vet their ideas?
JOHN WARREN (Editor/Publisher, San Diego Voice & Viewpoint): Well, you know, I think the answer's both a yes and a no. Number one, I think it was important to get a bill to the floor because he wanted bills to be ready for conference action, if you will, following the August recess. But we have a interesting situation with the Director of the Budget Office, a nonpartisan group coming forth with this position. This is the kind of position that should've been presented in advance, really, of the bill's coming out of committee. And then we have several committees that are involved here. We have House Ways & Means involved in the congress, we have the Senate Finance Committee involved. We have the Senate Health Education Welfare & Pension Committee doing legislation in the Senate. And so we have all of this activity going on and we don't have a meeting of the minds in terms of many of the details that are involved in this legislation. For instance, there's a surtax that's proposed that would tax the rich one percent $280,000.00, $350,000.00. It would take, say, up to $1500.00 a year from them to add to paying for this $1.2 trillion insurance plan. There is still the issue of Medicare which has not been made a part of it but yet the MedPac, the Medicare Advisory Council, is being looked at as an entity to take out of the congress the regulating of the payment of fees and to put it in this group so it won't any longer be the political football. And then we have the three entities that are fighting here. The insurance companies are fighting, number one. We have the pharmaceutical people fighting, and then we have the doctors and the hospitals. And the doctors and hospitals are in the best position because when you talk about providing care, these are the people who stand up and say, we're saving lives and you're preventing us, if you're forcing us to close hospitals when we need them—and we've seen the impact in San Diego County of not having enough hospitals, so all of this comes into this picture. And I think we have to go forward piece by piece. It doesn't have to be a perfect bill before it comes out of congress. The Republicans have not participated in committee and they've offered a whole series of amendments that will come up when you get to the conference report that will take the best of both bills and try to work out a package to come to the president. The important thing is that we have progress which we never got to this point with the Clintons, as much as they tried.
PENNER: Yeah.
WARREN: And it's a significant move.
PENNER: Yeah, and I think that one of the interesting issues on all of this, JW, is that there has been a big push for government to get involved in some way. Of course, there are those who are horrified at the thought of government getting involved in delivering healthcare. They say, oh, no, that's really a bad thing. But there is sort of a concept of this public option…
AUGUST: Right.
PENNER: …a government run health insurance plan that would compete with private insurers. Does it look as though the president and the Democrats are going to get that?
JW AUGUST (Managing Editor, KGTV 10 News): I really they do even though the Republicans really oppose it. You know, the administration calls it public insurance and the Republicans call it government insurance because they're all – you know, the word and the verbiage – But I think they'll do it because you're going to have to have something to hold the insurance companies' feet to the fire and what better than some competition where they're going to have to pay attention to rates. They're going to have to take care of – make sure there's tests that aren't ordered that don't – that aren't needed. They got to crack down on so much expenses for administration in the insurance industry, all of those things. I think the Republicans are concerned that the government does a bad job of running programs like this and they think it's going to be a fiasco. But if we don't do it, we can't get out on this road any more. Something's got to be done. By golly, at least something's being done.
PENNER: Our number is 1-888-895-5727. Do you feel that it is important for the current system of private health insurers to have some competition? And do you think that competition should come from government run programs and government – perhaps government financed programs? But the finance is another story. In other words, is the bottom line that we need to provide competition for insurance companies, is that your bottom line? I'd like to hear from you, 1-888-895-5727. Michael, is that the bottom line for you?
MICHAEL SMOLENS (Politics Editor, San Diego Union-Tribune): Well, I -- You know, the Republicans are concerned about a public option because they think that that's the first step towards a single payer government plan. I mean, this whole notion about government being involved in healthcare, government is involved in healthcare to, you know, hundreds of billions of dollars. I think it's just a matter of restructuring it. You know, there is a legitimate concern among those who are opposed to this or are concerned about it because, you know, is it a true, you know, government option that will be competitive? Or is it something that the government's going to subsidize? And I can see where the insurers and the private plans are saying that's an unfair playing field. But if it works right, it could be, you know, a hammer to keep costs down. Politically, I thought the tide had really turned when Harry and Louise resurfaced in their famous ad…
PENNER: Explain. Explain.
SMOLENS: …except – Well, Harry and Louise, back during the Clinton administration were the couple at the kitchen table talking about healthcare and basically, you know, ultimately how bad the Clinton approach would be. As we know that that had great promise and then fell flat through opposition. The same couple is now doing ads on behalf of people that want the healthcare reform. Let's not forget, the president has the great argument that I think everybody – pretty much everybody agrees with, that things have to change. Nobody thinks the current system is good, and that's a heck of an argument that I don't think was as strong or even as widely held back in '92 when the Clinton administration did this. However, the CBO…
PENNER: You mean things have gotten much worse.
SMOLENS: Yeah, I think everybody, you know, even those of us that have healthcare, and good healthcare, know that it's just not sustainable. Back then I don't know that people, as many people, believed that. That's a great hammer to get things done. But, you know, I got to tell you the CBO was a real buzz kill on things because part of Obama's argument also is that we need to change this because it will not only revamp healthcare but, you know, affect the economy. The healthcare costs will grow to suck so much out of the economy if we don't change things. And the Congressional Budget Office people are saying that, you know, the plans right now would continue and perhaps make it worse. So they're going to have to really address that, and the revenue side, as is always the case, going to be the picture. And, you know, I don't think it's a total surprise. I mean, people thought that how this was being structured were – they were still kind of whistling past the graveyard, thinking, you know, this might not quite add up. So they've got a lot of work to do.
PENNER: John Warren.
WARREN: Well, I think we must remember that the president did not miss this point. It's not like the CBO came out with something that he had missed in the course of events. He talked about, from the very beginning, structuring a trust fund that would generate up to, I believe it was, $500 billion. It would help with a longterm, ten year plan to finance this. He never brought a package that didn't have financing capability with it, and he knew that there were going to be elements to different parts of it. That's why he was smart enough to take the Medicare element and put it outside of that and that baggage is being carried now by two Blue Dog Democrats in the House.
PENNER: The conservative Dem…
WARREN: The conservative Democrats…
PENNER: Yeah.
WARREN: …who are looking for support for Medicare because the doctors are hurting. They're complaining. You talk to any doctor in San Diego, they've had to cut back on service, they're not getting paid what they should, they're working hours. We got this real life thing happening. My problem with the Republicans in this issue, the conservatives, is that people are sitting back criticizing but they're not offering anything substantive of a comparable nature to replace that which their criticizing.
PENNER: Well, I think we may have a suggestion from one of our listeners. Mary in San Diego has been waiting to call to speak with us. Mary, thanks for your patience, go ahead.
MARY (Caller, San Diego): Yes, thank you. Until we bring the pharmaceutical companies into – under control, we're not going to be able to have a healthcare plan. When they pass the Medicare Part D Plan, they put a proviso in there that congress could not—I repeat, could not—petition the pharmaceuticals for lower drug prices. Now, on July the ninth another Louisianan from – They passed a bill in the Senate that we can now import our drugs from Canada. Well, that's not going to help the United States a lot. When are we going to have the guts to stand up to the pharmaceutical companies and tell them that we want the same low prices that Canada gets? It's ludicruous that we would have to, in order to get lower prices, have to re-import our drugs from Canada.
PENNER: Thank you.
MARY: But – but the – but our representatives are bought by them and until we get rid of the lobbyists and quit having our representatives being bought, we're not going to get low healthcare. Thank you so much for listening.
PENNER: Of course. Thank you. JW August.
AUGUST: Whoo, right on. Hey, well, the pharmacy industry is very powerful, billions of dollars at stake. And by the way, they paid for the Harry and Louise ads that are coming out now. They're the guys that are paying for it. And she's right but it's the nature of the beast we're dealing with. I think we can only take off a bite of this and that right now but a longterm goal would, of course, have the outrageous profit margins these pharmacies have come down.
PENNER: John Warren, we'll get to your response in just a second. We have to take a very brief break and then I want to hear what you have to say. This is the Editors Roundtable. Be back in a moment. I'm Gloria Penner.
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PENNER: This is the Editors Roundtable. I'm Gloria Penner here at the table with JW August from 10News, and John Warren from San Diego Voice & Viewpoint, and Michael Smolens from San Diego Union-Tribune, and you, of course. We're talking about the healthcare legislation or the bills that are being considered now in the congress and what's wrong, what really needs to be fixed. And will it be fixed with what's being proposed now in congress. And we heard from Marilyn, I believe it was Marilyn earlier, and she was talk – saying, hey, got to control the pharmaceutical industry, and John Warren, you wanted to respond.
WARREN: Yes, I want to make three points, first dealing with Marilyn's statement. The AARP fought vigorously against the Medicare Part D legislation. It was President Bush's way of paying off the Republicans and the wealthy interests in this country because at no other time does the government contract with an entity doing volume business and not demand a discount or some bulk purchase price. They deliberately would not do that. That's why they have the provision, as she mentioned. It was intended to guarantee the income to the pharmaceutical people. So we have the capacity to change that now in terms of this administration. The second point I want to make is that this president has not advocated socialized medicine. He's advocated a competitive medical structure that puts another entity into the game beyond those that are just at the table. And it's not going to be easy. We have seen lobbyists assigned, more lobbyists than there are members in the House and Senate with the hundreds of millions of dollars going after this. But the good news is, that he is bright enough to stand his ground and he is pulling together some competent people who realize that there must be change . And I think that in the end we will be far better off than we were because the existing system, as he said, cannot stand.
PENNER: Okay. What I did want to mention that there – because of the resistance to the government run option, a nonprofit health cooperative is being mentioned that would not be government run but would be a different kind of system, and that's sort of being considered as well. And we could talk about that except we're starting to run out of time and I want to hear from our callers. So Michael in the South Bay is with us. And, by the way, that was Mary who spoke about the pharmaceutical companies, not Marilyn. Sorry, Mary. Michael, you're on with the editors.
MICHAEL (Caller, South Bay): Hello. Thank you for taking my call.
PENNER: Yes.
MICHAEL: I'm actually curious because it seems to me that the Republican party bases its foundation on fighting everything the government actually tries to do. Their actual basis, the role of government, is to stay out of the way of the people, basically saying we don't want to do anything at all. Why not have a competitive market system because, you know, isn't medicine or medical – the amount of money we spend in medical care or healthcare, isn't it among the highest in the world?
PENNER: Well, certainly it's taking a big bite out of our gross national product. I think it's something up to 15% now of our gross national product goes to the medical system. Is that right, John?
WARREN: It's not at 15% but it's projected to exceed 20%...
PENNER: Twenty percent…
WARREN: …in the next ten years if we go with the programs that are on the table.
PENNER: Let me speak to Michael. Let me ask Michael about Michael's. What has the lack of competition meant for the healthcare delivery system?
SMOLENS: Well, you know, I mean, there's been studies ad infinitum about how, you know, we spend more money than any other industrialized nation and have – get the least for it. So it hasn't worked particularly well. The system doesn't have enough checks and balances, which, I think, what, as John said, what they're trying to do is get a true competitive government, not necessarily, you know, a socialized program but a government run program that isn't subsidized that is a market-based program to try to check that balance. You know, when you've got things like the drug program that we were discussing earlier without any kind of, you know, governor to rachet back prices for com – I mean, that they can't, you know, not barter but they can't negotiate down for the prices on the drugs and that, it's just – it's almost un-American.
PENNER: You know, there's one aspect that we touched on before and it's a really important aspect and that is—I believe it's already passed one committee—and that is the surtax on the very wealthy, over $350,000.00 earners for families. That surtax would be used to help finance whatever new system we – is expected, which is expected to cost about one trillion dollars. What do you think, JW? Is it clear that this will have to be financed by a surtax on the wealthy and will that fly? Are they going to find other ways of financing it?
AUGUST: Well, look, for eight years Bush gouged the middle class and the lower classes. It's our turn. Let's gouge the rich for a while. We got four years of it. A little rich gouging never hurt anybody except the rich.
PENNER: John.
WARREN: Well, Pelosi supports the surtax and we got a Charles Rangel heading up the House Ways & Means. I'm sure it will get to the floor, there's no question there. And I think it's a good idea but the surtax, remember, is not being considered by itself. The surtax is in conjunction with the other financing component of the trust that the president made reference to. And if you put the two things together, you will come up with the $1.2 trillion over the ten year period. So he's not making a empty promise; he has projected how it would be paid for.
PENNER: Okay. Well, I really apologize to all the callers that we didn't get to but this is a topic we will be coming back to over and over again because certainly it's not going to be wrapped up that quickly in congress and as things develop we want to talk them out with you and analyze them and see where we are. So thank you for your calls, and do call again.
