6th Annual Templeton Lecture: Transcript

NATIONAL CONSTITUTION CENTER
JUNE 17, 2008

Stefan Frank

Welcome and good evening. My name is Stefan Frank. I am the Director of National Programs at the National Constitution Center. We are honored tonight to be hosting the 6th Annual Templeton Lecture on Economic Liberties and the Constitution. We will begin our program in just a moment, but before we do, I ask that you please turn off your cell phones or put them onto vibrate mode. As Doug mentioned, you were offered index cards and pencils on your way in this evening. If you have questions for our panel, please write them on the index card and alert one of our volunteers who will be collecting them throughout tonight's program. We will get to as many questions as we can this evening, and we encourage you to make them legible and as brief as possible. Speaking of which, we would, now, like to play a short message from the Chairman of our Board, President George H. W. Bush. Thank you, again, for coming and enjoy tonight's program. President George H. W. Bush (PSA) Welcome to the National Constitution Center. By participating in the following program, you are celebrating one of the greatest rights the Constitution gives us-the right to freedom of speech. Our democracy can only flourish through the knowledge and active participation of our citizens. A visit to the National Constitution Center gives you the opportunity to learn, through rare artifacts and hands-on exhibits, about the history of our government and our nation. It is an inspiring story of how we, the people, have made, and continue to make, this country succeed. I encourage you to visit the museum and discover this jewel of America that brings the message of our Constitution and the story of we, the people, to life.

Stefan Frank

Now, please help me welcome President and CEO of the National Constitution Center, Joe Torsella and our esteemed panel for tonight's lecture: Secretary Tommy Thompson, Senator Tom Daschle and Professor Doug Kmiec.

Joe Torsella

Hello everyone, I am Joe Torsella, and it is my privilege to be President and CEO of the National Constitution Center. On behalf of the board and staff here, I want to welcome all of you to the 6th Annual Templeton Lecture on Economic Liberties and the Constitution. A special welcome to our panelists tonight. We are very honored to have with us Secretary Tommy Thompson, the former United States Secretary of Health and Human Services, as well as Senator Tom Daschle of South Dakota, the former Senate Majority Leader. We are also thrilled to have with us an old friend of mine and the Constitution Center's, Professor Doug Kmiec, who holds the Caruso Family Chair in Constitutional Law at the Pepperdine University School of Law. Of course, none of them and none of us would be here tonight but for the vision and generosity of Dr. John and Pina Templeton. Before we continue, I would like to ask you to join me in recognizing and thanking them.

For six years now, even one year before there was a physical Constitution Center, the Templeton Lectures have showcased the sharpest minds in the country talking about the most important issues on the national agenda and demonstrating how the Constitution still connects directly to the issues that are central to our lives today. Previous lectures have focused on topics such as Imminent Domain, Immigration and Campaign Financing. Tonight, the speakers will delve into one of the most prominent concerns facing us as Americans in 2008, and that is healthcare. It is an issue that I suspect the framers did not, themselves, spend much time on, but the theme of tonight's discussion, mandate versus choice, highlights a fundamental tension that I think would have been recognizable to every last one of them. In the great healthcare debate, where are the appropriate boundaries between the federal role, the state role and the role we have as citizens? How exactly do we promote the general welfare while also being mindful, especially in a brave, new world of all kinds of information technology of the blessings of liberty? What rights do we, as Americans, have to healthcare and what responsibilities do we have? Tonight's speakers here in Philadelphia will touch on some of those issues and many more, and tonight's listeners and questioners will help extend this conversation well beyond the walls of the Constitution Center and the boundaries of this city. Tonight's Templeton Lecture is, for the very first time, being broadcast webcast live on our website, so welcome to all of you as well.

We would like to thank our partners at AARP who helped raise awareness for the event and collected questions from around the nation to be included in tonight's discussion. AARP will continue to foster dialogue with the American public on the issues raised in the Templeton lecture on their website, dividedwefail.org. We are especially pleased to have a representative that I hear of what the founders would have called "our posterity." That is the way to build citizenship. As with all of our evening programs, tonight's program will be podcast into the homes of our fellow citizens around the country and to listeners around the world.

Again, I want to thank Dr. Templeton for giving us the opportunity to take the time in a culture of 3-second sound bytes to explore such important issues in a meaningful and thoughtful way. Tonight's topic is especially close to his heart, I think. Jack Templeton dedicated decades of his life to helping children, as a doctor, at Children's Hospital of Philadelphia. In 1995, he left the operating room to head the foundation established by his father, Sir John Marks Templeton. The foundation sees its role as a catalyst for research, discussion and discovery on the biggest questions of our time. Dr. Templeton's appreciation for our American heritage and his commitment to Economic Liberties inspired him to establish this lecture series here at the Constitution Center. It has been 6 years now. We are proud and prouder every year of the result, but most of all, we cherish the friendship. Please welcome Dr. John Templeton.

Dr. John Templeton

Thank you, Joe. First of all, I want to thank the National Constitution Center for its sponsorship of the 6th Annual Templeton Lecture on Economic Liberties in the Constitution. Second, I want to thank especially two individuals who are responsible for our being here today. The first is Mr. Joseph Torsella. The second is Mrs. Joan Specter. It was the two of them who had the vision for an enduring lecture series that would draw attention to the extraordinary Constitutional rights and protections for Economic Liberties that are directly responsible for the energy, productivity and prosperity of the American republic. In our talks together, we realized that economic liberty is central to all of our other freedoms. In fact, much of the genesis of the American Revolution and our own American Constitution dealt with the issue of economic liberty. The writers of our Constitution saw it as a social contract with the people to assure fundamental liberties that are vital to the preservation of freedom. One critical part of our Constitutionally assured liberties is economic liberty. Milton Friedman stressed that democracy and economic freedom are mutually reinforcing. In that regard, I am especially grateful to my father, Sir John Templeton, whose vision regarding the wonderful heritage we have of economic liberty has guided me since I was a youngster. As Dad became more of a student of success in business, he grew to appreciate that enlightened laws, which uphold our liberties, also are founded on moral principles. In the area of economic liberty, he felt that these principles included an emphasis on personal responsibility for one's needs and the preservation of individual choice regarding the use of one's resources as opposed to perhaps the power of government to oppose mandates at the expense of personal choice. Furthermore, as the moral principle that for any representative form of government to survive, perceived rights must be tempered by a personal responsibility that asks, what serves the needs of the people best and what is the most economical and effective way of meeting these needs? This evening we meet to discuss the topic of healthcare-choice or mandate. As we listen to each of the carefully considered viewpoints, we need to ask ourselves several questions about economic liberty. For example, is it economic liberty to encourage competition among healthcare institutions for the best and the safest healthcare? Is it economic liberty to eliminate regulations that inhibit alternative solutions best suited to the needs and the desires of the public? Is it economic liberty when a state-mandated program for healthcare is slipping into bankruptcy within only 4 years? Last, is it economic liberty to foster a patient-owned, patient-centered healthcare system? As we ask these questions, it may help us to reflect on the values and vision of one of America's leading founding fathers. Thomas Jefferson was the founder of America's oldest political party. He said two things. First, "A wise and frugal government which will leave men free to regulate their own pursuits of industry and improvement and shall not take from the mouth of labor the bread that is earned-this is the sum of good government." Second, he said, "I predict future happiness for Americans if they can prevent the government from wasting the labors of the people under the pretense of taking care of them." This evening's program, therefore, is a special opportunity for us here at the National Constitution Center to address these vital issues in the matter of healthcare for all of our citizens within the Constitutional framework of economic liberty.

At this point, I would like now to introduce Professor Douglas Kmiec, who, as noted, will serve as moderator for this evening's program. He is Professor of Constitutional Law and serves as the Caruso Family Chair in Constitutional Law at the Pepperdine University School of Law. Please join me, then, in welcoming Professor Kmiec, who will introduce our program this evening, including our distinguished speaker, Secretary Tommy Thompson, followed by our distinguished discussant, Senator Tom Daschle. Professor Kmiec.

Professor Douglas Kmiec

Thank you, Dr. Templeton. Thank you, Joe, and thank you Secretary Thompson and Senator Daschle for being our distinguished guests this evening. Ladies and gentlemen, it is nice to see you again. It seems like just minutes that I was with you before. Healthcare has been much on the minds of American citizens throughout the past several months. It has ranked right up there with Iraq and the economy as the major issues, as the central issue, in the presidential campaign. One can listen to that campaign and read the public press about this issue and see a set of questions. Why is it so costly? Why, given its cost, is the quality not greater? Do either of the presidential candidates have a plan that would address cost, quality or some combination of the two in a positive way? Do we need to look outside of ourselves to the experience of foreign nations to see what works and what does not? In terms of cost, here are a few statistics that certainly trouble the mind when one encounters this topic. For a family of 4, the average insurance expense on an annual basis is now about $12,000. It has risen, in recent years, 4 times a fast as wages have risen. Today, you may have noticed in the USA Today, Price Waterhouse reports that the cost of healthcare is destined to increase 10% this year and 10% the following year. It occupies a significant portion of our gross domestic product, roughly 15%, which is significantly more than it occupies in terms of gross domestic product of any other comparable industrial nation. Even with these extraordinary costs, the quality of healthcare is open to debate. Consider this statistic in terms of the prevention of disease or preventable deaths from preventable diseases for people under 75. The United States ranks 15th of 19 industrial nations. Or this one-infant mortality; we rank last. Even our statistics on this subject are even less impressive than South Korea or Slovenia. I would have a hard time finding it on the map. Our life expectancy is increasing, but not nearly at the same rate or with the same robustness as life expectancy in our neighbors to the north in Canada or in Japan. It was mentioned in the fascinating warm-up opportunity that the World Health Organization reports that our health system overall is ranked 37th, which does not sound like a battle cry, "We are 37"; so we have a lot to do.

What are the candidates saying? Well, they are saying something pretty different than the existing program and different from each other. Neither candidate, as far as I can tell, is talking about the government directly providing healthcare, so it is not a question of a healthcare system equivalent to, say, the school system or a healthcare system equivalent to the DMV; and there is a certain relief in that. Senator McCain has a vision of the healthcare system that is very much dependent upon the themes of market competition that Dr. Templeton gave emphasis to. Senator Obama would put the emphasis differently. His focus is on accountability and using government as a measure of accountability. More from both of our commentators, I think, about this topic in a minute.

Canada, our neighbor to the north is a single-payer system. A single-payer system that, according to the Canadians, they are very happy with. Why are they so happy and we are so grumpy? Well, to find out some of these answers, we have two distinguished, knowledgeable guests this evening. Our principal speaker will be Secretary Tommy Thompson, who served as governor of Wisconsin for 14 years. As governor of Wisconsin, he earned justly a reputation of being an innovator-an innovator who brought competition and new ideas to the school system in the context of school choice, an innovator who brought new ideas to the medical system in terms of something that was nicely called "BadgerCare," which addressed the health needs of people who did not receive healthcare, either through their employer or through Medicaid, those folks who were falling in the gap. Secretary Thompson brought those ideas with him to Washington, and to the extent that federal law allowed him to grant waivers, he utilized that knowledge and structure to bring some needed flexibility for a good number of states over which he gave guidance. Secretary Thompson most recently was, as you well know, a candidate for the republican nomination. Someone else seems to have snatched that, but he is, nevertheless, someone whose voice is very much raised on this issue of healthcare as a partner with the Aiken Gump law firm in Washington, D.C. and as chairman of the Deloitte Center for Health Solutions, a consulting firm. Secretary Thompson is a man who, is fair to say, sees red on a political map, on the college football field and in the marketplace when healthcare costs are too high. Please welcome Secretary Tommy Thompson.

Secretary Tommy Thompson

Thank you very much, Doug, for your introduction, your comments and your tremendous service to our country and to this institution here. You have done a wonderful job, and it is always a privilege to get a chance to interact with you. Thank you, Joseph Torsella, for taking us around, and I hope every single one of you sees the tremendous exhibits here. I think every American should have the opportunity and the responsibility to go through here. I think it makes you feel proud to be an American walking through the history of this great country. I am delighted to be on the same program with my friend, Tom Daschle, who is a fantastic public servant and an individual who knows healthcare extremely well and is an individual that, I believe, is going to do tremendous things, yet, in his political career. I know that if presidential candidate Obama gets elected, a lot of people are pushing him to be Secretary of Health, and I could not be happier if he gets that particular position, even though I hope McCain wins. Mr. Templeton, Professor, thank you. Thank you for your comments and to everybody.

Ladies and gentlemen, I am a rehab public servant-38 years in the government and now I am in the private sector. For the first time in my life, I am making money. You know, there are tradeoffs. The tradeoffs are that I was governor for 4 years. I was Secretary and I had security and drivers. My last day as a public servant, my security and drivers wanted to take me out for my last supper. My last supper was, of course, coming from Wisconsin, beer, brat, cheese and cream-a lot of beer, a lot of brat. They took me home and dropped me off at midnight, gave me the keys to my car and my house and drove off; said I was the best Secretary they had ever worked for and gave me a cheerful embrace. I am sure they say that to everybody, but it made me feel good. I waved goodbye, went in and went to bed. The next morning I got in the back seat of the car. Trade off number one-realize that I had to get in the front seat of the car and learn how to drive again.

Then I was going down to Duke to give a speech on healthcare. I went out there, and, always before, somebody from my department would call up, and they would meet me at the curbside, give me my ticket and escort me through. I could never understand why you people complained about airports. I got out there that day; nobody showed up. I had to do an e-ticket myself; never done that before. I had the privilege of standing in line and getting my shoes x-rayed. What an indignant experience. You have realized, then, our country has changed. Healthcare has not. What I want to talk to you about tonight is the seriousness of healthcare, and why I am so optimistic about the opportunities to completely transform healthcare. In order to understand where we are, you have to understand healthcare. Healthcare is very expensive. It is 16% of the gross national product. Of all the goods, services, salaries and wages we spend 16% on healthcare. China, our big competitor, spends less than 3%. Japan spends less than 9%. The closest country is 12%, and we spend 16%. We spend $2.4 trillion. In the next 6 years, ladies and gentlemen, that is going to double. It is going to double to $4.6 trillion and go to 21% of the gross national product. Ladies and gentlemen, we cannot afford that. We cannot be competitive.

We have already seen what healthcare has done to the automotive industry. General Motors is this great corporation that we all prided ourselves on growing up and looking at, a corporation of success and efficiency. We are seeing, right now, that General Motors is in a race that they are going to lose. They are going to lose to Toyota. Every day, a salesman for Toyota gets up. They have to give up $1500 to a Toyota salesperson because every car General Motors puts out has a price tag of $1725.00 imputed to that car to pay for the healthcare system that General Motors has. Toyota has $225, so you are competing against a company that is $225 for healthcare compared to General Motors, who is paying $1725. General Motors cannot compete. We are seeing General Motors sales go from the 1970s, when they had 52% of the sale of cars, down to this year below 25% and still going down. One of the primary results is healthcare. If we go from 16% to 21-22% over the next 6 years, companies in Philadelphia and Pennsylvania will no longer be competitive. Healthcare is causing a tremendous economic problem for all Americans-economically, for families, for companies, you name it.

The second big problem that is coming is the fact that we have a shortage of healthcare providers. We do not have enough general internists and family docs. Gerontology is a profession that is going by the wayside. We do not have enough, especially when we are going to need it the most-the aging of America. Today, we have a shortage of 350,000 nurses-huge problem; a shortage of capable, qualified doctors, and we do not have individuals going into the medical profession and into the specialties to the extent that we need-like internists, gerontology, nursing and so on.

The third big problem that is facing healthcare is the fact that Medicare is going broke. In year 2013, that is 4 years from now, Medicare starts going broke, which means that there is less money coming into the system than is going out. Up until 2013, most people do not know this, but Medicare has had a surplus. That surplus has been going into the United States Treasury. Do you know what happens to money that goes into the United States Treasury? It is spent. Congress and the Department of Treasury has been handing out IOUs. There are piles of IOUs like this. Come 2013, Medicare is going to come knocking on the door and saying, we want some money. Congress, ladies and gentlemen, is broke. We have a deficit of $9 trillion, and we have a Medicare system that is going broke. These are the problems facing healthcare.

Healthcare is in a serious kind of catatonic state that needs an emergency. It needs a transfusion and transformation. People ask me, "Well, Tommy, you are the Secretary of Health. Aren't you pessimistic?" I say, "Absolutely not!" I am optimistic because for the first time, ladies and gentlemen, we have presidential candidates-a democrat candidate, Barack Obama; republican candidate, John McCain-that are talking about healthcare. Congress does not act unless there is a real emergency. There is a real emergency. I predict that the year 2009 is going to be the biggest year for the transformation of healthcare than any of us have ever seen, and I am excited about that. I want to make sure we understand, however it is that we have to, to make sure that we fix the healthcare system and do it in a way that is going to be affordable and accessible.

I am very concerned when individuals talk about a one-payer system. I do not think we can afford a one-payer system, and I do not think a one-payer system is very efficient. My mother-in-law died from breast cancer. My wife had breast cancer. My youngest daughter has breast cancer. I want a cure for breast cancer, and I want innovation. I do not think you are going to find the innovation for breast cancer, prostate cancer and all the cancers in a one-payer system. We have to allow the free enterprise system to work. How do we change the system? How do we make this healthcare system really work? How do we make it affordable and accessible? The first thing you have to do is you have to go where the money is, right? If you are a business person, when you are looking at a problem, you look at what is the outgo and what is the income. If you have more outgo, you know you have to fix it. That is what is wrong with healthcare. We have to fix it. There is enough money in the system; we just have to change it. I question some people that say, "Why do we not go to a European system?" Why do we not go to a Canadian system?" Ladies and gentlemen, we have the best medical system in the world. I know you can find statistics, like the Professor has pointed out; but I ask you, if you had cancer or you had a stroke or you were sick, would you not want to go to your doctor in Philadelphia or to a hospital? I bet there is not one person in this room that would raise their hand and say, "I would like to go to Germany." "I would like to go to France." "I would like to go to England." I do not think so. I think you would want to stay here in America because we have the best system in the world. I think that system needs to be repaired and we need to be fixed.

The first thing you have to do is you have to go where the money is. When Willie Sutton and Jesse James were asked why do you rob banks, what was the answer? That is where the money is. Where is the money being spent in healthcare? Seventy-five to eighty percent of healthcare is bring spent on chronic illnesses. We think, "we are Americans." We think, "we are virile, strong, robust, healthy Americans." The truth of the matter is we are a sickly lot. A hundred and twenty million of us have one or more chronic illnesses, and we have to do something about chronic illness and wellness. The beauty is that both political parties recognize that, and both political parties are talking about ways to make wellness and prevention part of their programs. I salute them. We have to do it if we want to get this cost under control. The big one is tobacco. Four hundred and forty thousand Americans died last year from tobacco-related illnesses, and we still do not regulate it. I bet if I asked the question, "How many of you take a baby aspirin for your circulatory system," a lot of you would raise your hand. The president does it, I do it, a lot of you do it. An aspirin a day is a very valuable asset and a very valuable pill to take. Yet, baby aspirin is regulated by FDA. Nicotine, which killed 440,000 Americans last year, is not. Does that make any sense at all? Absolutely not.

The second thing is we have to do something about diabetes. Eighteen million Americans had Type 2 diabetes last year. This year 21 million Americans have type 2 diabetes. It costs $145 billion, and the thing that scares me is that there are 41 million more Americans, some in this room, that are pre-diabetic, that will be full-blown type 2 diabetics in 5 years, costing $400 billion. We did an exhaustive study at NIH that said that if you walk 30 minutes a day and lost 5-10% of body weight, you would reduce the incidence of type 2 diabetes by 60%. We can all do that, and we can have a tremendous impact on the healthcare.

The third one is, we are all a little chunky. We can look in the mirror and say chunky is good. I come from a state where every meal is better with beer, brats and cheese; but we have to be willing to look at the fact that there is no food police in America. You can take anything you want, but you do not have to eat everything. Eat 50% of your thing, and you will eat, and you will lose weight. The second big thing is information technology. Ninety-eight thousand Americans died last year; this is the Institute of Medicine figure. Fifty percent of the wrong medicine at the wrong time in the wrong amount to the wrong person. Doctors have to get straight A's to go to medical school. You do not want a doctor operating in you with at D+ average. You do not go into a clinic and say, "I want the dumbest doctor here to look at me." We want the brightest doctor. Doctors have to get straight A's except for one grade, and the one grade is handwriting. Doctors' handwriting has not improved any in the last 50 years, and only 8% of the doctors are e-prescribing. If you require doctors to e-prescribe, you would reduce the incidence of death by 50% overnight. That is not that difficult. The third one is electronic medical record. If you had a stroke here tonight, and your husband was not with you, how long would it take for the emergency room doc to find out your pre-existing illnesses, the medicines you are taking? It would take you a long time. You could die. The doctor does not want to do any harm, but he does not have your records. We can have a hundred pages of our medical records in a chip in our pocket that could be downloaded. We should have an electronic medical record, so that doctors would be able to know which pre-existing illness you have and what other ailments you have. He or she does not want to do you any harm, but he wants to make sure you are safe. Your veterinarian knows more about your dogs and cats than your doctor knows about your children. In this great country, do not you think we should have electronic medical record information technology?

Forty-seven million Americans are walking around without insurance. Another 25 million are underinsured. Who pays for the uninsured? We do. Where do the uninsured go for their medical care? Emergency room. What is the most expensive healthcare? The emergency room. Now, help me with this computation. Is that not a little dumb that we allow 47 million Americans to get their primary care, a good share of it, in emergency care, which we pay for? Why do we not set up a system in America to make sure that every American is covered, so that every American is going to be able to get the basic care at a clinic in downtown Philadelphia. You would save money, and you would be able to make sure that everybody is covered by health insurance. The fourth area-what we have to do is we have to start managing healthcare. Twenty percent of the individuals that are severely ill cost about 80% of the cost of healthcare. If we would intensely manage individuals that are really severely ill and disabled-make sure they have their drugs and make sure they get the training necessary-you could save enough money to be able to really reduce the cost of healthcare. If you were able to reduce that 80% down to 65%, you would be saving hundreds of billions of dollars.

How many of you in this room know what a 1040 is? You all know what a 1040 is. The most complex tax system in the world, we get down to one form when we send in our taxes; it is a 1040. If you are a large company with a lot of employees, like General Motors, they fill out a W2. If you have a small employer, they fill out the same W2. If you have a more complex employment system where every employee fills out the same W2, why can we not get down to one form to go into a hospital? Why can we not get into one form to submit to the insurance company? How many of you get these EOBs, Explanation of Benefits? Does anybody understand them? I got barrels full of those that just waste time and energy and nobody understand. If you got down to one form, you would save $135 billion. Insurance companies would not like it, but you would be able to do it. If you got down to a paperless system, you would save $195 billion, almost 10% of the cost of healthcare. What I am telling you is, if you make the system affordable and accessible, you can make it efficient, and you can save enough dollars to be able to have a healthcare system that really is going to accomplish what is necessary.

In conclusion, let me finish with my favorite quote because I think every single one of you is part of what Teddy Roosevelt said: "It is not the critic who counts. Not that man or woman who points out how a strong man or woman stumbles, or where the doer or the deeds could have done them better. The credit belongs to that man or woman who is actually in the arena." You! You are here to learn about healthcare. Your face is marred by dust and sweat and blood. You strive valiantly. You make mistakes. Every one of us does. We are human. We come up short again and again, but there is no effort without error and shortcoming; but does actually strive to do the deeds, and that is what is happening with you. People like you all over America are looking to save the healthcare system we have and transform it into one that is affordable and accessible. The great enthusiasms, the great devotions who spend yourself in a worthy cause have been proving the healthcare system; who at the best knows in the end the triumph of high achievement and who at the worst, if you fail, at least you failed dearly. So that your place shall never be with those cold and timid souls who neither know victory nor defeat-the pessimists, the back-benchers, the individuals who, I think, get up in the morning, eat grapefruit and suck lemons all day. I like people like you who are excited, willing to change, have enthusiasm for transforming healthcare and making it better. Ladies and gentlemen, may the road always rise to meet you, may the wind be always at your back, may the sun shine warm upon your forehead and the rains fall soft upon your fields. Until we meet again, may God hold you in the palm of his hand. Thank you.

Professor Douglas Kmiec

Well, no sucking lemons and I am not sure about the beer and the brats. Those might be out too. Thank you, Secretary Thompson, for an energetic presentation. There are many questions that I have, and I know the audience is passing a good number of questions on cards to the runners in the aisles; so put your questions down. We now have a formal respondent as is the tradition of the Templeton Lecture to the main lecture, and it is a distinguished public servant. Tom Daschle served 4 terms in the United States House of Representatives. He served, I want to say, 2 terms in the United States Senate-3 terms in the United States Senate, so I do not want to say 2. He was the former Senate Majority Leader. He is a graduate of the University of South Dakota. He served 5 years as an intelligence officer for the United States Air Force in the Strategic Air Command. He is presently a visiting professor at Georgetown. He has a number of other academic appointments. He is associated with the law firm of Alston & Byrd in Washington, D.C. as a senior policy advisor, and he has done some very thoughtful writing for Center for American Progress on the topic that we are discussing this evening. He is the national co-chair of Senator Obama's campaign, so he will be able to tell us a great deal about Senator Obama's plans, but I know he has his own particular perspective, as well as a response to Secretary Thompson. Senator Daschle.

Senator Tom Daschle

Thank you very much, Doug, for that very, very nice introduction, and thank you for your warm reception. I, too, want to thank Joe Torsella, and I certainly want to thank Dr. Templeton for his generous sponsorship of this extraordinary evening. I was listening to the introduction, and Tommy and I can both tell you that in politics, you get introduced in so many different ways and so many different venues. I was once introduced as a model politician and a model United States Senator and a model South Dakotan and a model family man. I felt very good about that introduction, too, until my wife showed me the word model as it is defined in the dictionary. There, it is defined as a small replica of the real thing.

I remember that wonderful story of Mark Twain who followed Chauncey Depew to the podium, just as I am following Secretary Thompson. Mark Twain made the following announcement. "Prior to this program, the previous speaker and I exchanged speeches. You heard my speech, and I forgot what he was going say." Well, I have to say I am again so impressed with the comments of Secretary Thompson. I have been a very, very big admirer of his for a long time. I admire his leadership on health, and I admire so much of what he did as governor and State of Wisconsin, and I cannot tell you what a pleasure it is for me to be with him on this stage this evening. I think so much of what he said is exactly right, and it is encouraging that a prominent republican and a democrat would find as much common ground as, I think, we will tonight. I appreciate very much the leadership that he has shown and the advocacy that he demonstrated as Secretary, and that he continues to demonstrate in his public speaking around the country. Let me also thank AARP for their extraordinary work and their efforts, especially in Divided We Fail. They are right; divided we will fail.

I share a good deal of Secretary Thompson's optimism and his enthusiasm about the importance of this debate and the extraordinary opportunities the next couple of years could present. I even share some of the same views with regards to how one defines the problem. I would put them slightly differently. I think we have three significant problem categories. The first is cost, and we have talked some about it tonight. The most recent figures that I have seen and used is that we spend about $8,200 per capita in taxes, premiums and out-of-pocket expenses-$8,200 per capita. That is 40% more than the second most expensive country; and, of course, as Tommy noted, we spend more than anybody else. He talked extensively about General Motors' inability to compete. They spend more on healthcare than they do on steel. Starbucks spends more on healthcare than they do on coffee. This is no small matter for business. It is no small matter for any American; and as he noted, these numbers are only going to go up unless we do something serious.

I believe that the second issue is access, and he mentioned the problems we have with regard to the primary care shortage and the doctor shortages we have in some parts of the country. That is especially true in rural America. Forty-seven million people, at some time during the year, have no health insurance. About 37% of the people are underinsured, but we also have serious problems with regard to access to mental health, to long-term healthcare and problems regarding provider shortages that go way beyond just rural America.

The problem we have with regard to access affects the third problem. I believe we have a serious problem with regard to quality in this country. This is probably the only significant difference I would have with Tommy with regard to characterizing our current system. I cannot characterize it as the best healthcare system in the world. I think we are far from the best. Not when, according to Save the Children, we ranked 22nd in women's health, 28th in mothers' health, 33rd in children's health. The World Health Organization, as Doug noted, ranked us 37th, below Costa Rica and above Slovenia. That, to me, is an indication that we have a problem. I would describe our healthcare system today as islands of excellence-the mayo Clinic, which I am happy and very proud to be a member of the board of trustees; the Cleveland Clinic; perhaps a significant number of your institutions here in Philadelphia; islands of excellence in a sea of mediocrity-mediocrity, especially, in some parts of our country. The average life expectancy on an Indian reservation in South Dakota for an Indian male is 47 years old today-ten years above what it is in Botswana where one-third the people have AIDS or HIV. We have a long way to go with regard to improving our healthcare system, and I do not think we ought to live under, I would call it, a myth that we have the best healthcare system in the world. I think, in spite of what differences there may be and how we describe the current system, I would not think there is any difference with regard to the goal. I think the goal is to have a high-performance healthcare system based on value. Value is access and quality over cost; making sure we get the best use of every dollar we commit to healthcare in terms of the access and quality that we would expect from the healthcare system today.

How do we do that? I think, again, the Secretary laid out some very, very, concrete and specific examples of what needs to be done, and frankly, I agree with every one of the examples and suggestions he made. He did not mention a couple of them that I think are very important. I agree, especially on wellness. Every healthcare system is a pyramid. We are at the base of the pyramid. You have primary care and wellness promotion; the cheapest and really the most efficient kind of care. You work your way up until you get to the very top, which has the most sophisticated technological applications of healthcare. Every other society starts at the base of the pyramid, and they work their way up until the money runs out. In America, we start at the top of the pyramid, and we work our way down until the money runs out, and we pay a whole lot more for the inverse direction that we take healthcare on that pyramid now. I believe that that is so critical. I also believe that we have to change the infrastructure within our healthcare system, especially for decision-making purposes. As a person who served in Congress in either the House or the Senate for 26 years, I can tell you that we do not make good managers of a healthcare system, but that is what we are expected to be today. Just as we would not make good managers of our monetary system-we delegated that responsibility over a hundred years ago to the federal reserve-I believe we have to create the same kind of infrastructure for our healthcare system today-delegating managerial responsibility and recognizing the importance, as he said, of having choice. I am not a single-payer advocate either, in large measure, because I do not think you could ever get it passed in this country, even though we should recognize 45% of the people in this country get their healthcare from a government-driven system today. Fifty-five percent get their healthcare from the private sector, but we ought to have that choice. Somehow there has to be a far better integration of that managerial responsibility, and I do not think Congress can affect health policy and managerial decisions anymore than they can decide the interest rates that we should have with regard to our monetary policy.

The third big, big change we need is transparency. Our healthcare system is the most opaque of any sector of our economy today-by far. The best example of that is the number that Tommy used. I am sure most of you do not fully appreciate the fact that about 100,000 people die every year because of medical mistakes-100,000. That comes out to a 747 crashing every day and a half. Now, if a 747 crashed out here at the airport tomorrow, how long will it be before we get NTSB out here and all of the investigators to tell us exactly what happened, and we go through whatever procedure is necessary to make darn sure it did not happen again. We do not do that in healthcare. We do not use what we call standard of care, nor do we have the transparency to allow us to better understand why is it that 100,000 people die every year. He put his finger on one of the best reasons, and that is that we have a 19th century administrative room and a 21st century operating room. We have to bring the administrative room into the same century as the operating room and use the IT that Tommy talks so eloquently and passionately about. Having the standard of care is so critical.

We also need payment reform. This goes to Medicare in particular, but it really has to be across the board. Today, it is on procedure. If we cut back on the amount we pay for each procedure, guess what. Doctors, oftentimes, are able to make up in volume what they cannot in a unit price. That is exactly what happens. We need episodic reimbursement, not procedural reimbursement. That would go a long way to helping address the challenges we face today.

I have just a minute left. Let me just say, I too have a quote. It is not one of my favorite, like Tommy. It is not one of the favorites that I have used, oftentimes, on Teddy Roosevelt that the Secretary referenced tonight. It is one of another hero of mine, Nelson Mandela. Nelson Mandela was talking about something else altogether. He once said, "Many things seem impossible until they are done." Healthcare reform has seemed impossible in this country for a long period of time. With the kind of bipartisanship I hope we can achieve and with real leadership from the next President of the United States, this too can be done! Thank you all very much.

Thank you, Senator. We now begin the dialogue, and you have an opportunity to put a question directly to Secretary Thompson.

Senator Tom Daschle

I would ask the Secretary a question that, I know, he has been asked before; and that, to me, is so important. What are the obstacles that we face in this polarized political environment? How is it that we can achieve real bipartisanship in healthcare reform? How do we do that?

Secretary Tommy Thompson

I think the chain of events are going to take place with the election of a new president. I think that Barack Obama, if he gets elected, is going to instill a degree of hope and opportunity, and I think that is with the democrats in control of both Houses of Congress. I do not think there is any question that you are going to see tremendous transformation of a lot of subjects, especially healthcare. Everybody is talking to the candidates, democrats and republicans. I think John McCain has reached out more than any other republican and has teamed up with Teddy Kennedy and Chris Dodd and with you, Tom, on many subjects. I think the fact that we are electing a new president is going to bode well for bipartisanship, and I think everybody is going to hear it in this election. Let's have bipartisanship. Let's forget about the personal accusations and the tearing down. Let's start building America. Let's build it up, and I feel that that is going to come through in this campaign. Maybe I am an eternal optimist because I grew up in Elroy, Wisconsin, but I really, sincerely believe that.

Professor Douglas Kmiec

Building on the optimism in Elroy, Wisconsin, let me find some of the common ground that I think you both mentioned. I heard both of you talk about savings achievable from changes in terms of the handling of medical records, moving from the paper age to the electronic age. Does that include a smartcard, as it were, that someone would carry around with them that would have, basically, all of their medical records on it.

Senator Tom Daschle

I think it could include a smart card. I think Tommy mentioned a chip, and I think you can do it in a lot of different ways. I just happened to have lunch yesterday with Secretary Peake of the Veteran's Administration and just an extraordinary leader on healthcare. We were talking about this very issue-the dramatic, dramatic reduction that the VA has actually experienced in bringing down their administrative costs by moving to Health IT, by dramatically turning over these manila folders and the extraordinary bureaucracy that has come about. Thirty percent of our healthcare dollar is spent on administration in one form or another. He has been able to cut that by almost two-thirds. That is what we can do in our healthcare system across the board. Smartcards and chips are one significant way with which to do that.

Professor Douglas Kmiec

So there is bipartisan agreement on the improvement of that. I take it that takes an expenditure of money to move toward that technology. That is an investment that comes from the government side, Secretary?

Secretary Tommy Thompson

Yes. I agree with Tom. Isn't that nice; to have a republican and democrat agree on something? I like that. I agree with it, but first off, the chip is good. Smartcard is good. What we really have to do is get to an electronic medical record in America. Taiwan has an electronic medical record. Everyone person in Taiwan gets a card with a chip in it, and that card has the whole record, and the government is able to figure out where the person is, and the record is being downloaded. It is a wonderful system. We can do that in America. If Taiwan can do it, America certainly can do it; but I have come up with an idea that I think has a great deal of merit. How I would pay for it-I would set up a mini Hill-Burton technology fund. I would take the fraud and abuse money that we now take in, which is going to be $2.5 billion, and I would set up a mini Hill-Burton technology fund, Doug. I would use that and ask the doctors and clinics and hospitals to match it one by one. That is a $5 billion swing overnight if you set it up. Would that be great optics-take away from bad doctors to give to good doctors, bad hospitals to good hospitals, bad providers to good providers. The fraud and abuse money now goes into the Department of Justice. I do not know how they spend it. I know we collect at Department of Health and Human Services and goes into Department of Justice, but if we had a mini Hill-Burton technology fund using the fraud and abuse money, we could transform technology overnight, and I could not think of a better way to be able to have doctors and hospitals and clinics rally around it using the fraud and abuse money.

Professor Doug Kmiec

So we stimulate this new technology with government funds, perhaps raising it from part of the private sector as well. The candidates have been talking, and several questions come from our guests here from AARP about the competing candidate's vision on health care. If I understand Senator McCain's proposal, it is to separate the delivery of healthcare from the employment relationship and to, basically, allow individuals in the market to purchase their own insurance. He would propose to help finance that with a tax credit-a $5000 tax credit for joint filers, $2500 for individuals. We have heard here tonight some estimates of what the annual cost is. Senator Daschle, you put the annual cost of $8200 per capita. I put the annual cost from some health affairs magazine materials that I found at a little higher than that at around $11,000. Either way, there is, obviously, going to be some out-of-pocket costs for consumers. Is that the way to go?

Secretary Tommy Thompson

If I were to agree with your assumption, you are walking me into a buzz saw, so I do not agree with your assumption at all. Let me set it up the way I think it should be set up. I think every state should set up an insurable pool, so that all the uninsured in the state of Pennsylvania is in an insurable pool. In that insurable pool, you are going to have a single coverage and an family coverage. Then, put it out for bids and let any insurance company in America be able to bid on that, like we did on Part D for Medicare for drugs. We were amazed by the plethora of insurance companies that came in and bid on that. Any company that is selling health insurance would love the opportunity to come in and bid on a million individuals that they could enroll in their health insurance programs here in Pennsylvania's. In those, I would also ask for a refundable tax credit of $2500 for a single, $5000 for a family for anybody up to 145% of poverty. You would be able, then, I think, to get individuals covered by health insurance based upon the free enterprise system of bidding and bidding competitively for that type of business.

Professor Doug Kmiec

One related question, if I might, Mr. Secretary, came earlier from the audience about pre-existing conditions. That is, how would an insurance market handle pre-existing conditions in a bidding circumstance without government intervention?

Secretary Tommy Thompson

In my scenario and the way I would set it up-which is different than the way John McCain is talking about-you would have to take the pre-existing illnesses because you would be bidding on the lot. When you look at the uninsured, one-third of the uninsured is between the ages of 18 and 33-individuals that do not believe that they are ever going to get sick. It is a good pool to bet on. Thirty-two percent of those individuals make over $65,000 each. It is a pool that will work, provided you allow insurance companies from all over the country to bid on it, and you get a lot of bidders to bid on it.

Professor Doug Kmiec

Thank you. Senator Daschle, any thoughts on-

Senator Tom Daschle

A lot of thoughts, and, again, I am just thrilled that Tommy and I can agree on so many of these details. He was subtle; yet, I think, if you listen, he made a very good point. The concern I have about getting rid of the exclusion-and maybe we should just define what the exclusion is. Right now, the health benefits you get from your employer are not taxed. That is what we mean when we talk about exclusion. It is not taxed. It is a benefit of immense value to you as a worker. If you are given this benefit, it is worth a lot more than a few thousand dollars. Often times, it could be worth 2-3 times what John is offering as an alternative; so I am very leery about giving up that exclusion unless you go to something like what Tommy is suggesting. First of all, I think there ought to continue to be a role for the employer. If an employer sees-as one of the ways to stay competitive and hire the best employees-that they want to provide health insurance to their employee, they ought to be able to do so. If you are not going to have the kind of responsibility that we now have come to expect from employers, and fewer and fewer employer are doing this, you have to do exactly what Tommy is suggesting, which his to create these purchasing pools. The only way these purchasing pools are going work is if you get rid of, what we call, adverse selection or the pre-existing condition. You cannot say, "Well, if you are sick, you have to go somewhere else." What John is offering is the suggestion that we create these sick pools and that the government subsidize the sick pools and that we can somehow cover people that might be excluded as a result of that support. That is not going to happen. You cannot possibly fund those pools adequately; but if you have a collective pool with a community rating and get rid of the pre-existing condition or adverse selection, you can do that. That, to me, is probably the direction we are going to be headed.

Professor Doug Kmiec

Both of you mentioned wellness. There is a recent report in the New York Times about Japan asking its employees to come in to get their waistlines measured. If, in fact, your waistline, as a measurement of metabolic health fitness, was over the target, you suffered certain penalties, both economic penalties in terms of your employment and the employer suffered certain economic penalties. Do you foresee the same kind of sticks in the U.S. prospect of encouraging wellness, or are we going to do it a different way?

Senator Tom Daschle

Let me just start, and I am sure we both, again, could spend the evening and talk about this. Obesity in this country is almost at pandemic levels. We have to acknowledge that. We are in a world of hurt when it comes to obesity. Life expectancy among my grandchildren is actually going down because of obesity statistics in large measure today. We have serious problems that are auxiliary problems related to obesity, and diabetes is one of the most common. We have huge problems that have to be addressed. I would not go so far as the stick approach Japan is contemplating here, but I do think we have to recognize that wellness and primary care access is really critical. We also have to recognize this should not just be the responsibility of our healthcare system. It ought to be the responsibility of our school system. We ought to provide the kind of education and better nutrition and wellness and good physical education required. We have to do a lot better job with school lunches. It has really got to be pervasively understood through our society, and we have a long way to go. You just have to look at what the Secretary noted on tobacco. Look what effectiveness we can generate from dental preventative care today with getting checkups and taking care of our dental issues before they become even more serious. We need to do that across the board in healthcare as well, but I think we ought to start with the carrots and consider sticks down the road.

Secretary Tommy Thompson

I agree with everything that Tom said, but I would like to elaborate a little bit because I am really into this. We have a diseased society. We base our reimbursement on procedure. We do not have a wellness system. We wait until people get sick and then we get them treated. Would it not be nice to be able to prevent people from getting sick in the first place? That should be our goal. Number two, we criticize the children for being overweight. They are! Only 25% of the schools require physical education. I think that is stupid! I think every school should have physical education. It was the only course I ever got a grade A in. I want to get back to that. The third thing is, sometimes you have to do a few things that, I think, are logical and common sense. I am on a board of an insurance company and we put in play, at my request, two lines; and I offer this as a suggestion to corporate America. If you have a cafeteria, why do we not put in two lines. Put in the fruits and the vegetables and the soups and the salads and subsidize it or give it away. In the second line, put the high-fat foods, charge $5 for a hamburger, $10 for a cheeseburger and 20 cents per French fry. You know something? You would change human nature. Have you ever walked into a hospital recently? Pizza, hamburgers. A hospital should have healthy food. They do not. Then on smoking-I am president of a company in La Crosse, and we charge more from the individuals that smoke. We offer an opportunity to get all your money back if you stop smoking. We offer a plan, not only for our employees; he can bring in his wife or his children, and we will pay for the program. We will pay for the counseling and the drugs, and we will pay back all of the things because we do not want the individual to go home and have the wife smoking or the husband smoking because that is too hard on the employee. We bring the whole family, and you know something? We have about a 72% rating right now of getting those individuals, that were smokers, to quit. That is going to be to the bottom line. We tell those individuals that we charge more if they are smokers. Here is our program. We do not want to charge you more. We want you to quit smoking, so you will be a more productive employee, and that is what we have to do in corporate America.

Professor Doug Kmiec

Senator Obama, as part of his program, has proposed a mandate that all children be covered. Secretary, as I heard your remarks, you mentioned the foolhardiness of not providing coverage for those who would then use the more expensive emergency room care. I take it that type of mandate is agreeable from the philosophy that you bring to this.

Secretary Tommy Thompson

No, I do not want a mandate because mandate is not working in Massachusetts right now. That is the one example where it has not worked, and I do not see where you are going to force people to have health insurance is really going to work. I am not opposed to it; I just do not think it is the most practical way. I would like to lay out all of the opportunities for a person to buy it, and I think you can convince-with a $2500 income tax rebate or a $5000; you do not get it unless you apply for health insurance. Most people will take that in a minute, and I think you can get very close. The SCHIP program-I like Obama's plan of trying to get every child covered because I tried to do the same thing in Wisconsin. I just do not know if mandate is the way to go. I am not there yet.

Senator Tom Daschle

Can I respond quickly because it is one of those rare things where we may have some disagreement. I am not big on mandates either, but people ask me all the time, "Is healthcare a legal right?" I do not think it is a legal right in this country, but it is a moral right. Along with a moral right, I think, comes the need for individual responsibility. We ought to legislate, at least, individual responsibility. We do it for drivers who say they want to drive a car. We say, we will give you a driver's license on a condition that you get insurance. We do it for homeowners. It seems to me we ought to do it for health as well if that is the only way we can bring people to the realization that they have to take individual responsibility. What is happening today is those who do not get insurance, go to the emergency room and the rest of us pay. That is called "cost shifting," and we are cost shifting more and more on. This morning they said that one of the reasons why prices went up 10% last year in healthcare was that there is an increase in cost shifting going on from those who are uninsured to those who are insured. We have to end that cost shifting, and if we can take a page from others-now, I agree Massachusetts has not reached 100%, but they are doing a whole lot better than most states, and they would do a whole lot better than that if they actually provided greater assistance to those who could not afford it. That is really the big problem they have today. They still have not reached that threshold of affordability for a lot of people who cannot pay the price.

Professor Doug Kmiec

We are going to need to wrap up in a minute, but there are several questions from the audience and the AARP on prescription drugs. There is one question that asks, "Why is it that we cannot buy prescription drugs at the same price that they are available in Canada?

Secretary Tommy Thompson

It is very simple. The Canadians subsidize it and put cost controls on drugs, and America does not. We have a free enterprise system that allows pharmaceutical companies to charge what they want. You have to realize that just about 75-80% of all new drugs are produced and created and the research done in the United States. That is something I want to foster. I want those new drugs to come out. As I said previously, I want to find a drug or a cure for breast cancer. I want to find it for all the cancers. You cannot do it in a cost-controlled system like Canada. Even now-

Professor Doug Kmiec

So the legal prohibition that we maintain on the re-importation of drugs-

Secretary Tommy Thompson

I am not big on that. People go up to Canada all the time and bring it back and nothing happens to them. It is somewhat of a joke. I just want people to understand; in a cost-controlled system, somebody has to pay for this research. I do not think it is fair-the fact that America's the only one that is paying for it, and other countries are not paying for it, but I still like the fact that we are allowing for new drugs to be created in America. That is the future of our country.

Senator Tom Daschle

I agree with most of that. We do negotiate prices for veterans, and we negotiate prices for the Department of Defense. We do a lot of negotiating right now with the pharmaceutical companies. I agree with research, but what is happening in this country is that as research dollars go down, marketing dollars for pharmaceuticals go up. We see too many drug ads. If I see one more drug ad for Viagra or Cialis or any of these-I just think that we have to understand that that is where a bigger and bigger share of the market is going, and that, to me, is disconcerting. If there is one thing worse than political ads, it is drug ads, and I think that they have gotten out of hand. There has to be a lot better self-control of marketing than what we have seen so far.

Secretary Tommy Thompson

My idea on the drug ads, Tom-I agree with you, but I agree to this point. I think that every time a drug company is putting out an ad on one of their drugs, they have to put out a public instruction, public information drug on obesity, on asthma, on diabetes and so on. The problem in America is we are not very smart about our bodies and about healthcare. Of the twenty-five percent of the people that have diabetes, 50% of that 25% do not know it. One-third of the seniors going into Medicare this year are type 2 diabetic, and 50% do not know it. This is the kind of information that we have to get out to America to change it. Those are costs that could be really controlled.

Professor Doug Kmiec

This is the final question. It is to both of you. It is from the AARP. One of the things, the questioner asks, that they hate about medical bills is that, "I never know how much anything is going to cost beforehand, and I am not really comfortable asking my doctor whether there is a less expensive way to get care." Do you think making healthcare costs more transparent-you both, to some degree, talked about transparency-would help people get more value for their money? In answering the question, you both identified the single-payer system as having some benefits. One of the benefits-but not likely in the United States or perhaps not advisable in the United States-often held out for a single-payer system is that it eliminates the fractionating of the insurance process where doctors are playing one insurance off against another, changing their pricing to see what they can squeeze out in terms of profitability. If we do not have a single-payer system, what is the antidote to address this problem of shifting of variable costs across procedures? I will go with Senator Daschle first and allow our principal speaker to conclude.

Senator Tom Daschle

There is absolutely no reason not to have greater transparency across the board in healthcare, and that also means having more of an ability to evaluate your providers and your institutions, both from a quality point of view as well as from a cost point of view. We do not have that info because it is generally not made available today. That is not true of almost anything else a consumer in America purchases. What could be more important to you than the quality of your healthcare and access regarding information involving your healthcare? I think it is really important. I would say, as I said at the podium, one of the ways to address this fractionated question and reimbursement is to get away from procedural reimbursement and move to more episodic reimbursement; that is, to recognize that this per-procedure way we compensate today is really getting out of control. All of kinds of games can be played.

Professor Doug Kmiec

Just tell us a little bit how the alternative would work then.

Senator Tom Daschle

Let's assume that you go into a hospital, and you get tests, and you get care visits by the doctor, and you get immunizations, and you get perhaps some surgery and several different providers. At every stage of care that is provided, there is a line-item bill associated with that particular procedure. Those bills are subject-and no one knows this better than the Secretary-to what we call diagnostic-related groups and reimbursement based on-at least on the Medicare side, but also on the private sector side-certain payment schedules associated with each one of those procedures. In the name of cutting back on costs, Congress will sometimes say, we are going to reduce the reimbursement level for a given procedure. What would prevent a doctor-and I am not suggesting that this happens a lot, but I am certainly not suggesting it does not happen-from saying, "I am just going to add one more procedure to make up for that loss in reimbursement for the procedure I have just seen a cut in. What many experts suggest is just to take that entire experience and say, here is what we are going to spend. Here is what we are going to charge and reimburse based on the whole experience rather than the 'each line item experience' that you have as you go through the process of your healthcare stay. That, to me, makes a lot more sense. That is especially true for chronic care management, where so much of the money goes today. Seventy-five prevent of all the money we spend in healthcare goes to chronic care management. We could do that; we could do episodic reimbursement for chronic care management perhaps far more efficiently than what we do today.

Professor Doug Kmiec

This is within the context of Medicare. Would you expand it across the board?

Senator Tom Daschle

Absolutely. Across the system.

Professor Doug Kmiec

Mr. Secretary.

Secretary Tommy Thompson

There is no question that we do not ask enough questions about our care. There is a little hospital system out in Nebraska, called Allegiant. It is in Omaha, and Tom is familiar with that system. It is a great little hospital. I think they have maybe 6 or 7 hospital. I think it is 9 hospital and several nursing homes. They have set up a system where you type in your name on your computer, Tommy Thompson, and you put down the procedure that you want-colonoscopy-and immediately comes up, what the procedure is going to cost, what my insurance company, United Health, is going to pay and what you have to pay. It is immediate, and would it not be nice if every hospital was like that? You could compare all of the hospitals across the country. We should demand that. Allegiant has done that, and it is a fantastic system. Everybody loves it-the doctors, the hospital. You go in for what you are going to pay for. Nursing homes-we set up a system when I was Secretary that we had 9 or 12 qualities; AARP helped me set it up with certain nursing homes. Now, it is across the country. You can type in and find out the kind of care nursing homes are having. All the nursing homes are listed. You can make comparison on bed sores with this nursing home down the street or one next door or in the next city. You can make those decisions in your front room before you put Mother or Father in a nursing home. We should do that not only for nursing homes but for hospitals and doctors and find out what doctors are doing the best job. I know doctors will not like it. Hospitals will not like it. The nursing homes did not like it, but now they bought into it, and they would not be without it. It is a system of transparency and quality that we need inculcated into our system.

Professor Doug Kmiec

Once thing we have demonstrated again this evening is that information, good information, timely received is critical for the success of either a competitive market system or a more accountable system. I thank this audience and AARP for its intelligent questions. I thank Secretary Thompson for his main presentation and Senator Daschle and thanks to the National Constitution Center. We are adjourned.