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CNN "State Of The Union" - Transcript


Location: Washington, DC

Interviewer: Wolf Blitzer

SEN. KENT CONRAD (D), NORTH DAKOTA: Look, everything does have to be on the table. You can't negotiate properly without that rule in place. But I don't think the House proposal as I've heard it will be what's part of the final package.

I think there may be some request from those of us who at the highest levels of income in this country to pay a bit more. But there will be a much broader package of revenue as well as spending reductions in order to make this package work.

BLITZER: Yeah, are you open to the House version to consider a tax on people making more than, let's say, $250,000 or $300,000 or $350,000 a year, add 1 percent or 2 percent additional tax on their gross income to pay for health care reform?

SEN. LAMAR ALEXANDER (R), TENNESSEE: No, that's a bad idea, Wolf. What is on the table seems to be taxes like that more state taxes to support Medicaid, more cuts in Medicare, more employer taxes. What should be on the table -- and more government programs.

What should be on the table are more proposals like the one Senator Gregg has made or Senator Burr, Senator Coburn. There are 14 of us, Democrats and Republicans, who support the Wyden-Bennett plan, and that would give every American dollars with which to buy their own health insurance and could be done without adding a penny to the debt.

BLITZER: You want to tax benefits, health care benefits that employers provide to their employees as income?

ALEXANDER: I'm willing to stop giving tax deductions to people for Cadillac health insurance plans in order to give everybody a chance to buy their own health care insurance and not add a penny to the debt. I think that would be a good way.

BLITZER: No matter what their income.

ALEXANDER: No matter...

BLITZER: No matter what the income?

ALEXANDER: What it means is if we've got a Cadillac insurance plan and your employer gives you that, then some of it's going to be taxed. That money will be used to make sure we do -- we can't keep adding to the debt in the way we are.

BLITZER: Senator Stabenow, is that OK with you?

SEN. DEBBIE STABENOW (D), MICHIGAN: Well, Wolf, I think, realistically, the one thing that is off the table is taxing employee benefits. I think we'll see some other combination of things. But employees don't determine what insurance companies are going to charge them for their health care for their family. And I think that's pretty much off the table. What's most important...

BLITZER: Senator Alexander says it should be on the table. STABENOW: Well that may be his view. I respect that. But it is not I believe the majority opinion. But I think what's also very important in this discussion is that over half of the cost of reforming and changing the health care system is going to come with greater efficiencies, it's going to come with changing from quantity of tests to paying for quality, paying for health care not sick care.

I mean that's what makes it exciting.

BLITZER: But hundreds of billions of dollars, Senator Stabenow, are still going to be required and that money, according to President Obama, he wants a deficit neutral plan, doesn't want the taxpayers to be burdened with additional costs.

That's going to have to come from somewhere, and that's what I hear you saying is you don't want it to come from taxing health insurance benefits.

Let me ask Senator Gregg what he thinks.

STABENOW: That's correct.

SEN. JUDD GREGG (R), NEW HAMPSHIRE: What do I think about that issue?


GREGG: Well, I think the UAW is calling the shots there, and that's why it's not on the table because they've got some very high- end health policies, and they don't want them to -- their union members to have to reduce those health policies.

But why don't we look at trying to control the rate of spending by looking at better quality delivery systems, which are more affordable? We've got a lot of excellent studies that tell us you can deliver a lot better health care at a lot less cost if you give people incentives to go out and buy health care intelligently, if you give employers the capacity to reward people for purchasing health care intelligently and giving up lifestyles which are basically counterproductive such as smoking.

BLITZER: Well, quickly, Senator Gregg, do you -- would you support, could you see yourself voting in favor of health care reform legislation that includes this public option, a public government-run insurance company to compete with the private insurance companies like Blue Cross and Blue Shield or United Health Care or some of these others?

GREGG: No, we do not want to go down the road that basically undermines our fundamental health care delivery by creating a state- run government system in this country and that's what a public plan is, it's a stocking horse for a single payer system.

BLITZER: Because Senator Conrad, you're not convinced that a public option would necessarily pass, that's why you've come up with your own compromise version of co-ops. Having these co-ops that wouldn't necessarily be completely public or private, it would be somewhere in the middle. You think that's passable?

CONRAD: I do. And really just to be clear, the cooperative plan is something that we see across many business lines in the country, very successful. The "Associated Press" is a co-op, we've got Ace Hardware as a co-op, Land O'Lakes, a $9 billion entity, is a co-op.

The beauty of it is that it does provide competition for insurance companies. But it is not government-run, government- controlled, it's membership-run, membership-controlled.

BLITZER: Could you support that, Senator Alexander, the cooperatives?

ALEXANDER: Well, it all depends. I mean, Blue Cross could probably fit under his definition of a co-op. The problem with a government-run plan would be something like this. Say the president said let's buy the rest of General Motors to keep Ford Motor Company honest. And that wouldn't matter unless he gave the government car some advantage.

So he might say, well, all your repairs are going to be at a very low cost, but all of the mechanics might say, we're not going to -- we're not going to work on the government car. That's what you have with a government plan today with Medicaid. 40 percent of the doctors won't serve Medicaid patients because of the low service and it's the only option that people have.

BLITZER: I want to ask Senator Stabenow. I'll rephrase the question for Senator Stabenow. Could you support that does not include a public option?

STABENOW: Well, my first choice and very strong choice is a public option. And I have to say, Wolf, that what my friends are saying, Senator Gregg and Senator Alexander, really are scare tactics that have been put forward by folks that don't want to change the system because they make a lot of money off the current system right now.

BLITZER: Very quickly, all four of you, if you can give me a yes or no answer, I'm going to play a clip of what the president of the United States said in an exchange with a reporter in Italy on Friday and I want your answer. Listen to this.


UNIDENTIFIED MALE: Is it pretty much a do or die by the August recess?

OBAMA: I never believe anything is a do or die. But I really want to get it done by the August recess.


BLITZER: Will there be legislation on the president's desk, Senator Gregg, by the August recess? GREGG: On health care, I think that's highly unlikely since the Finance Committee doesn't even have a bill drafted yet. And we're in the middle of the Sotomayor hearings for this week and then we're going to be debating her nomination for a week before we adjourn for this August recess.

BLITZER: Let me ask the chairman. What do you think?

CONRAD: I think we'll be through the Finance Committee by the August recess and I think that's a realistic goal. You know, there really is plenty of time. Congress is going to be in session until Christmas Eve.

BLITZER: What do you think?

ALEXANDER: No, there's no reason to rush. We need to get it right, not add debt, not have a Washington takeover.

BLITZER: Is the president going to be disappointed, Senator Stabenow?

STABENOW: Well, I think he's going to be very pleased with the progress we're making. I believe we're going to move this through the Finance Committee. We're going to get it done as quickly as possible. The most important thing is to get it right. The American people have waited for a long time.

BLITZER: A new revelation that the CIA withheld information about a secret intelligence program from Congress on direct orders from then Vice President Dick Cheney.

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