Interview With Robert Siegel and Julie Rovner on NPR's "All Things Considered"

Robert Siegel: The president spoke with me and Health Policy Correspondent Julie Rovner. He defended the bill from critics who say it's a giveaway to the insurance companies; and he indicated that in the end, there's likely to be some tax on expensive health-insurance plans -- the so-called Cadillac plans.

I asked President Obama how he would convince a voter of the virtues of this bill when so many of its provisions don't kick in for three of four years.

The President: Well, first of all, I think it's important to understand, Robert, that a lot of the provisions will take effect immediately after I sign the bill. Let me just run through a couple of them.

Number one, right away there are a whole host of insurance abuses that will be put to an end after this bill is signed so that, through fine print, insurance companies can't suddenly drop you when you get sick or insurance companies that have practices where they put lifetime limits on your expenditures, those kinds of provisions will no longer be allowed.

You know, back in the '90s, there was a long conversation and significant debate here in Washington around a patient's bill of rights. It never happened. Well, in fact, a patient's bill of rights on steroids is contained in this bill. A lot of those provisions go into effect right away so that people who have health insurance -- and I meet families like this all across the country who are really having a tough time with the insurance that they've purchased or their employer has provided them -- they will now have a level of protection they've never had before.

Just a few other things that happen right away: Help for seniors in closing the doughnut hole which makes their prescription drugs very expensive, particularly when they need them the most; that is immediately going to start changing so that prescription drug costs are lowered. If you are a young person just out of school and don't have a job with health care, right away we are going to have a provision in there that allows you to stay on your parents' health insurance up to the age of 26 or 27.

You're going to have an appeals process so if insurance companies aren't doing right by you that you can actually appeal it and you're not reliant on some insurance company bureaucrat. So there are a whole host of things that actually will be hugely beneficial to people with insurance right away.

And the last point I'd make is, right away, if you have a preexisting condition, you are going to be able to buy into a catastrophic plan that at least provides you some protection. Right now folks like that all across the country aren't able to get health insurance at all.

Julie Rovner: Mr. President, before any of this takes effect, there'll have to be a House-Senate conference to put it together. One of the big issues is going to be how this bill is paid for. The House wants to tax wealthy individuals; the Senate wants to tax health-care providers and these very generous health plans -- the so-called Cadillac tax. Which of those would you rather see in a final bill?

The President: I think what we're going to end up seeing is a little bit of both. You're going to have some provisions that are smart that are in the House bill. There are going to be some provisions that are the right thing to do in the Senate bill. For example, I'm on record as saying that taxing Cadillac plans that don't make people healthier, but just take more money out of their pockets because they're paying more for insurance than they need to, that's actually a good idea and that helps bend the cost curve; that helps to reduce the cost of health care over the long term. I think that's a smart thing to do.

But the important thing, when you look at the Senate and the House bill, is not the huge differences; it's actually the remarkable similarities. Ninety-five percent of the House bill and the Senate bill are in accord. And there are going to be some tough negotiations around the 5 percent. What we know is is that under either the Senate or the House bill, there's going to be an exchange set up so that people who right now can't get insurance in the private market can go in and get a good deal.

We know that subsidies to small businesses, so that they have a greater incentive to provide health insurance to their employees, that's going to be in the bill. The things that ensure that not only 30 million people get health insurance, but also that you have the insurance reforms for people who have health insurance and don't have the protection they think they're buying right now, we know those things are going to be in the bill.

And we also know that under either scenario, as I indicated at the beginning of this process, it's going to be deficit neutral. And, remarkably, I think to much -- to the surprise of many cynics in Washington -- so far, at least, we have actually observed that line in the sand that I drew.

Robert Siegel: Might you end up taxing people with Cadillac benefits and Chevrolet salaries, that is, people who are not anywhere near the 200,000 (dollar) income level you talked about; you wouldn't raise taxes on those people? Is that a possibility in this one particular case?

The President: Well, keep in mind that what we're talking about is imposing a tax or a fee on insurance companies for providing plans like that. But the fact of the matter is, members of Congress, for example, their policy basically costs around $15,000. A lot of people, when I travel around the country, they say, well, why don't we just make sure that everybody has the same plan that Congress has?

Well, I think that's a pretty good benchmark and the cost of a plan for members of Congress, which are pretty good health-care plans, is about $15,000 a year. Right now this fee on Cadillac plans doesn't kick in until 23,000 (dollars) under the Senate bill. So I think that we can structure something that protects ordinary workers, makes sure that they are getting a great health-care plan, but also makes sure that they're not overpaying in a situation where they're just giving money to health insurance companies that instead could actually be going into their pockets in the form of higher salaries.

Julie Rovner: You talked about the 5 percent difference between the House and Senate bill. Obviously one of those things in that 5 percent is this public plan, the public option. Without some kind of public option, critics say this bill is a huge giveaway to private insurers because people will be required to purchase coverage.

Without a public option, how do you keep those private insurance companies in check somehow?

The President: Well, first of all, I think it is very important to keep in mind that the insurance companies have spent hundreds of millions of dollars opposing the bill. And although I know NPR doesn't have advertising, if you turn the dial on your radio and you listen right now, there will be an insurance company ad somewhere trying to kill this bill.

The notion that somehow this is something that the insurance companies welcome is just nonsense. There are a couple of critical protections that we feel very confident are going to push costs down.

Number one: the structure of this exchange. Essentially, again, going back to the model that Congress uses and federal workers use, the reason that Congress has pretty good rates -- they get a pretty good deal -- is they're part of a huge pool of millions of federal workers and every insurance company out there wants that business. And so they've got to compete and they've got to keep costs relatively low and quality relatively high in order to get that business.

Now, if you or I just go to the private marketplace, we've got no leverage and we don't get as good of a deal. The idea here is we're essentially setting up an ability for everybody in the nation to pool together and buy through this exchange. That's going to drive prices down. If insurance companies try to engage in obnoxious practices, they're not going to be able to compete. That's point number one.

Point number two: We've got a provision in the bill that talks about medical loss ratios. That's a fancy term for basically saying that insurance companies -- we're going to look to see how much of the average premium is going into actually providing medical care and how much is going to profits and overhead. And by keeping the profits and overhead low, we can make sure that, in fact, prices are kept down. So I think there are a lot of provisions in here that protect against insurance company abuses. That's why they have spent a lot of money and a lot of lobbyist person-power to try to oppose it.

Robert Siegel: Mr. President, some people have faulted this whole process for not focusing enough on how medicine is practiced in the U.S. and our appetite for lots of tests and the like.

I want to ask about a recent, coincidental event -- the new guidelines on mammography.

The President: Right.

Robert Siegel: They suggested that we've been testing too much and it would be better to get tested less. There was an outcry. Your own secretary of HHS backed away from the new recommendations. What does that say to you about how best practices can actually be instituted in the country?

The President: Well, I think what it says, number one, is that we still have a tendency to think that more medicine is often -- is automatically better medicine. And that's just not the case. Inside this reform bill that I'm pushing is a provision that has a panel of experts -- doctors, medical experts -- who are going to look at all these practices to start changing how we think about medicine.

Robert Siegel: Will politicians defer to their judgments -- to their scientific judgments?

The President: Well, one of my goals is to make sure that doctors and scientists are giving the best information possible to other doctors who are seeing patients.

Look, if you talk to most health-care economists right now, they will tell you that every good idea out there -- when it comes to improving quality of care and reducing costs of care -- are embedded in this bill. It's not going to happen overnight because we're going to have to change both how doctors think about health care and how patients think about health care. And there are going to be millions of small decisions all across the country and interactions between doctors and patients that, over time, change the trajectory of -- of our health-care system.

The important point is we're getting started in this process. And I'm actually very confident that the average person is going to say to themselves, if, right now, I'm taking and paying for five tests and my doctor tells me that I only need one, that person's going to want to take one -- save some money and save some time. But they need some validation. They need somebody who's giving them the better information. And we have set up a system where, year after year, best practices are going to get disseminated across the country.

Robert Siegel: Why didn't that happen with the mammograms?

The President: Well, I --

Robert Siegel: Why didn't people say, well, of course we should have fewer tests?

The President: Well, I think part of what happened is that it was released very quickly without any sort of thought to how this was going to get disseminated throughout the system.

And you know, I think one of the things that has made health-care reform hard generally is that, you know, people work off of anecdotal information and they get scared and they get nervous and they think, well, the devil I know is better than the devil I don't. That's why it's so important for us to set up a structure where doctors can get the best information possible.

I actually think that the average doctor cares deeply about their patient and if they get good information that says I can do the same kind of medicine, practice better and save my patients money, that they're going to want to do that. And that's why, by the way, that the American Medical Association, at this point, is supportive of our reform efforts.

Robert Siegel: Mr. President, thank you very much for speaking with us today.

The President: Thank you so much -- appreciate it.