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Remarks by Senator John Kerry and Iowa Health Care Forum

Location: Des Moines, IA


SEN. KERRY: Governor, thank you very much for that generous and accurate introduction. (Laughter.) I accept it. I should have stood up and said, "Thank you for my most recent introduction." I appreciate it.

Governor, thank you. More importantly, thank you for your extraordinary leadership and thank you for starting America off in the heartland, in Iowa today, with what we all hope will be the beginning of the end of a journey to provide health care for America. And I thank you for doing that. (Applause.)

I just want to take one minute, if I can, to divert, because I learned on the way over here of a plan in the Pentagon that was made public today to cut the pay of 148,000 troops who are serving in Iraq, to cut their pay, because they say they can't afford to pay them the $75 of imminent-danger pay and $150 of family-separation pay.

And I call on the president, by the end of today, to make it clear that not only is that not an option, not only is that not a definition of patriotism or support for these troops, but this administration should apologize for even giving the families and those troops the anxiety of thinking that that might be the regard in which they are held in 120-degree heat while they are taking fire on all sides and standing for our country. I'm sure you will join me in that. (Applause.)

We say a lot in the things we choose to do about our values in this country. That is one expression of values. Health care is obviously another, and it is clearly one of the most important in the nation today. I had prostate surgery a number of months ago. And I remember waking up in the hospital, in Johns Hopkins Hospital in Baltimore, with some of the world's best surgeons and anesthesiologists and best care in the world.

And it reinforced in me something I have always believed and always voted for, but it underscored the degree to which I was privileged, probably somewhat as a senator, certainly as someone with money, but it underscored emphatically how much I believe and how we all share a belief that in the United States of America, in the richest country on the face of this planet, we must stop being the only industrial nation that does not understand that health care is not a privilege, it is a right, and should be affordable to every single American. (Applause.)

I have thought long and hard about how to do this. I was part of the debate in 1993 and '94. I've watched my colleague, Senator Kennedy, fight for 40 years to get health care in America. I've seen 12 different plans, different ways of approaching it.

And what I did was I tried to sit down with the most expert people I could find and learn from the lessons that we have learned in past years, lessons that so many of the nurses who are here understand first-hand, that Andy Stern, who's struggling with SEIU and others, that people want to apply to this moment in time in American history, when businesses are aching under the weight of the costs, when even the people who have health care are aching under the increased deductibles and co-payments, lack of benefits. For all Americans, the health care system is in crisis.

And what I wanted to do was learn from the lessons of Harry and Louise, learn from the lessons of that very complicated chart that Phil Gramm showed on the floor of the Senate, with all kinds of boxes, and it confused Americans, and put together a plan that we can pass that will play to the best values and instincts of our nation and that we can cover Americans with health care.

And here is what I do. I am going to offer every single American the opportunity to buy into the same health care plan that the president and senators and congressmen give themselves. If it's good enough for us at your expense, it's good enough for every single American at their own expense, and we can make it affordable and accessible.

But not only am I going to do that. I'm going to guarantee that every child in America is covered immediately. And the way we do that is by working a swap with the states. Currently the states do Medicaid for children, but it's complicated. They don't like to enroll them. It's hard to outreach.

What we're going to do is say to the states, "We will cover all Medicaid children at the federal level automatically, automatic enrollment, every child." And the swap with the states is that the states will agree to cover the difference between the Medicaid break and 300 percent of poverty for families and 200 percent for individuals.

And we give the states a period of time to get back on their feet fiscally in the next couple of years to do that, but that will make certain that we get to 96.5 percent coverage within the next three to four years. And I am committed to guaranteeing we have universal coverage before the end of my presidency. (Applause.)

Now, that's how we reach out to the uninsured. That's how we guarantee that children are covered. But the problem in America, as the governor has so eloquently said to you in the past moments, is not just the people who are uninsured. The problem is the 163 million Americans who get health care today in the workplace, for whom the costs are going up at such a rate that they can barely afford it.

And every time anybody in labor goes to the bargaining table in America and bargains an increase in wages, they're forced to just transfer the increase of wages over to the health care industry. Every time anybody in the private sector gets a raise, the raise is transferred over to the health care industry at a rate ranging from 17 percent for drugs alone to 25, 30, 40, 50 percent for premiums.

What I do, my friends, is create a novel idea that I'm proud of. I create a federal fund, and the federal fund will offer every business in America a deal. If the business agrees to cover all of its employees—and as I said, 163 million Americans are already so covered—if the business will agree to pass any savings I give them back to the employee, and finally, if the business will agree to have a health education wellness program in the business so people learn about early detection and nutrition, screening practices, that's all they have to do. If they will do those three things, which most people are doing, then we will agree to pay 75 percent of the cost of every catastrophic case in their plan.

That means effectively that every individual currently with insurance has a $50,000 cap on the risk they're currently paying for. No one in America will have to pay a premium that pays for the most expensive cases in the health care system. That means that every premium in America goes down. And the experts who have judged this plan have told us it means for every premium-payer in America, there will be a $1,000 reduction in their premiums. That, my friends, is 10 times the tax cut that the average Iowan got from George Bush. It's real and it makes a difference. (Applause.)

Not only do I speak to individuals about how we reduce costs—and, you know, I want to say ahead of time, what my plan does is not throw some enormous sum of money at businesses and say, "Here, here's a credit for something you're already doing.

" And it doesn't just throw money at businesses and hope that costs might come down. It forces costs down because we're paying 75 percent of that cost.

You ask me how we're going to pay it. I'm going to pay it by either canceling or stopping, depending on where we are, the high end of the Bush tax cuts. America has a choice. (Scattered applause.) America has a choice: Tax cuts for the wealthiest Americans or health care for all Americans in a system that makes it affordable and fair. (Applause.)

Let me say a couple of other quick things, and I want to leave time for questions. There's another problem. And again, Tom eloquently spoke about it. It's not just a health care cost to the individual, but we spend $1.4 trillion on America, $350 billion of which doesn't even go to care. It's administrative overhead and costs. It costs us a cent, one penny, to go to an ATM and take money out of the bank. It costs $15 to $25 to pull a medical record in a hospital.

When was the last time—I walked into a doctor's office recently. They handed me a clipboard with a piece of paper and a pencil attached to it to fill out my record for the umpteenth time when I could have walked in with a smart card and handed it out with security, walked out with my update and carried my medical record with me.

We live in the virtual age, but the medical industry is not in the virtual age. And one of the reasons is the Medicare reimbursements are so low that hospitals are struggling. Nurses are paying the price of that struggle. They're making life onerous for nurses, the (wards?) of America. We're losing nursing. Nurses are going out into other businesses or into just private delivery of service.

We need to reduce the costs because doctors and nurses did not go into the profession of taking care of people in order to push paper around. We need to care for people. (Applause.) So I have a quality incentive and a technology incentive. And we're going to invest in helping hospitals and the health care industry to buy the state-of- the-art technology so we can begin to reduce the costs of health care from the 25 percent overhead (it works out?) today. No other business in America works at 25 percent overhead. And if we provide quality and technology help, we can reduce those costs.

In addition to that, we can also reduce medical errors. Thirty percent of seniors are hospitalized for mistaking their drugs. And that costs America about $80 billion a year, because we don't screen diabetes early enough. We pay about $100 billion total for diabetes care in America. I am told by experts that if we did early detection and screenings for some of the things I've talked about, we could reduce those costs by about $50 billion because we'd reduce the level of dialysis and the level of amputation and surgery necessary.

We've got to deal with wellness in America, and part of that begins by joining the EPA and the FDA and beginning to care more about the things we touch and the things we put in our bodies in the United States of America -- (applause) -- and start to care more about wellness in the long run.

The final two things I want to share with you and then I'll take questions. Obviously we have to change the Medicare reimbursement. We have to do what's right. You have the second-largest number of seniors over the age of 85 in the nation. And with rural delivery and difficulties in cost here, it is wrong that you are last in the nation in Medicare reimbursement; that in an urban center for hip replacement, somebody gets $1800 and here you get $1300, and work in many cases longer hours and more cases.

We need to adjust according to population, according to use, according to age, according to difficulty. And I voted for that with Tom Harkin to make it happen. And when I'm president, let me tell you something—they're not going to slip it out in the dead of night to a conference committee, because I'll veto the bill and send it back to them until they give it to us. We need to change the Medicare reimbursement rate in this country. (Applause.)

I also will tell you, as the former chairman of the Small Business Committee, 98 percent of America's business are small business. Fifty-six percent of our employees are in small business. We need to make it affordable for small businesses to buy into that congressional plan I talked about. And I'm going to provide a 50 percent credit to those businesses to be able to do so.

We're going to have a sliding scale to help individuals be able to buy into it, if they choose to, outside of a company. And we're going to pay 75 percent credit towards the COBRA for employees so people can afford, if they are laid off, unfortunately, to be able to carry health insurance in the United States.

And I can promise you a drug prescription that will make us proud. I voted against this prescription bill. It is particularly going to be tough on rural communities where you don't have Medicare HMOs, where you're going to be pushed into the private sector, where currently, if you're on Medicaid and Medicare, it will push people into Medicaid alone. It's wrong, because on Medicaid alone many people will have less drugs affordable available to them than they had on Medicare, and it makes second-class Medicare citizens. And that's wrong in our country.

So, ladies and gentlemen, what we need, the bottom line, is we need leadership. We need a willingness to stand up and talk to America. And the beauty of my plan is this: It can pass because it doesn't grow government bureaucracy, because it doesn't create a mandate that every business in the nation is going to resist.

It creates an incentive, the best values of America—a market incentive that's irresistible because it's a net plus of $5 billion to the states to help them in exchange for the Medicaid swap because it makes sense for business to let the government pay 75 percent of their most expensive cases. Why? Because it lowers their cost of doing business and makes them more competitive with other countries in the marketplace. And finally, it reduces the level of bureaucracy, makes the whole health care system empowered, liberated, free, and (to save?) money.

I hope you'll join me in this endeavor to pass a plan that makes sense. But first, ladies and gentlemen, you've got to make me president of the United States of America. Thank you very, very much. (Applause.)

GOV. VILSACK: Senator, we'll let you get comfortable in the hot seat there. Before you came, we --

SEN. KERRY: These don't hurt, do they? (Laughter.)

GOV. VILSACK: No. We solicited some comments and some questions for you, and it's my job to ask those questions and obviously your job to answer them. Your plan, Senator, may, at least at the beginning, leave some Americans uninsured. And I think we would like to know a little more detail about what the long-term strategy is for making sure that we get to the universal access that you referred to earlier.

SEN. KERRY: Well, I'm committed to getting to it, Tom. I mean, we get to 96.5 percent. That's a .5 percent difference between any other plan that I know of immediately. But we cover all children. And what I've said is, once we get there, we can look and see very specifically—I mean, we've worked for 40 years to get where? Nowhere. What is George Bush's plan? Nothing.

We have an opportunity to get to 96.5 percent without the resistance of the industry, because the industry is going to get paid. People are actually going to be more efficient. And once we get to the 96.5 percent, I have said we'll look and see which piece of the population is still having difficulty. And I absolutely pledge they will get covered. We will have universal coverage before I terminate my presidency, or it is terminated for me, and we will make that happen.

GOV. VILSACK: There are --

SEN. KERRY: "Terminate" is a bad word these days. (Laughter.)

GOV. VILSACK: (Off mike.)

SEN. KERRY: That's what I mean. That's why I say that. (Laughter.) I thought you all got that that's what I meant. (Laughter.)

GOV. VILSACK: Senator, there are a number of folks in this audience that deal with the challenges of mental health and substance abuse issues. And I think that they would be interested in hearing from you about what your plans are to incorporate mental health and substance abuse treatment, because we know that the cost of business and to society is enormous if we fail to address these very critical issues. Give us some thoughts on mental health and substance abuse.

SEN. KERRY: Tom, thank you. I appreciate the question. First of all, I'm for mental health parity. I've voted for mental health parity. We need it within health insurance. There has to be coverage for mental health coverage in America. We need to begin to screen children at an earlier stage, younger people, because many experts tell me that if we did that and begin to become involved at an earlier stage, we could, in fact, reduce the long-term impacts and costs to our society.

I used to be a prosecutor. I spent a number of years running one of the largest DA's offices in America. And I started a drug task force back then and I spent time as chairman of the Narcotics Terrorism Subcommittee in the United States Senate. And in all of my thinking about and involvement with the substance abuse problem in America, I have found that we have never really had a true war on drugs in this country. And the reason we've never had a real war on drugs is that we have never had every child in America educated about it, and the best we've done is about 55 percent.

And secondly, we don't have treatment on demand. You can't have an addict come to a place for help and not have the capacity to take all addicts off the street. No pusher can push fast enough to make up for that population if you began to treat it. And we've proven that we know how to do this with respect to nicotine. We know how to do this with respect to alcohol. But we're not really trying to do it with respect to more dangerous and pervasive kinds of narcotic substances in our community.

I want us to have treatment on demand in the United States so we take seriously the value changes that are needed in order to bring people back. And if we did that, we will save prison money, we will save drug abuse money, we'll save chronic unemployment money, we'll save insurance funding.

And what we need is a value system where we understand it is more important to realize that rather than spend $50,000 a year to house somebody in jail for the rest of their life, invest $10,000 a year in Healthy Start, Smart Start, Early Start, Head Start, early childhood education, and give them a stake in life and avoid the problem in the first place. That's the choice we ought to be making. (Applause.)

GOV. VILSACK: Senator, we want to thank you for your participation in this forum. And ladies and gentlemen, please join me in thanking Senator Kerry.

SEN. KERRY: Thank you very much. (Applause.)


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