For Immediate Release
Office of the Press Secretary
August 13, 2002
President Discusses Healthcare Security at Economic Forum
Baylor Law Center
Economic Forum Portal Page
10:08 A.M. CDT
SECRETARY THOMPSON: Mr. President.
THE PRESIDENT: Thank you all for coming.
SECRETARY THOMPSON: Mr. President, we're having a great session on medical malpractice and health care costs, the uninsured, and I've decided to pick several speakers to give you an update. And the first one I'm going to ask to give you a speech and an update is Grandma Green, Flora Green, who is an individual who is going to talk about Medicare. And she is a feisty little lady. So, I interrupted her --
THE PRESIDENT: Kind of like you, Tommy. (Laughter.)
Hi, Flora. Where are you from?
MS. GREEN: Salt Lake City. I met you in Salt Lake City.
THE PRESIDENT: Of course.
MS. GREEN: Barbara's boy. (Laughter.)
THE PRESIDENT: Thanks for coming. I thank you all for coming, by the way. I want you to know that economic security relies upon good health security. The two go hand in hand. And we understand that, and I want to thank you for sharing your ideas about how to make our society better for all of us. Flora, thanks for coming. I'm interested.
MS. GREEN: Well, thank you, Mr. President. Thank you, Mr. Secretary. This is a great opportunity, because I want to speak for the heart of America, for the senior citizens that are suffering, who want action now. We don't want to wait two or three years.
Like I say, I get up this morning, it's a good day. (Laughter.) But I don't know. I see many of my fellow seniors that have difficulty getting up in the morning. They're tired of waiting. They want this to be handled now. But there are some other issues, too.
Those of us -- and I'm finding about three quarters, maybe not quite that much, 60 percent of the folks have a plan in place that they want to keep. We want to make our own decisions. We're capable of doing that. I want to keep the Medigap insurance that I have that came as a survivor benefit.
One of the other issues that we're hearing, why can't we have tax credit for the premiums that we are paying for our Medigap insurance. Why can't we have tax credits for the -- over a certain benchmark of prescription costs? These are things that seniors need, and need now. They need to cover the paperwork.
I had a woman bring me a stack of papers like that. I said, don't show it to me, because I don't know how to do it either. (Laughter.) And it's really true, they get -- they just get confused. I did make a lot of notes, thank goodness. (Laughter.) You might be sorry.
But another thing that came up that I thought was tremendous, and as I said to the group, I have 24 grandchildren, 17 great grandchildren. Ten of my grandchildren are not married. So heaven knows what this is going to lead to. But I'm concerned about their future. Every bill that gets passed today has impact on these many beautiful little children to come into my family.
SECRETARY THOMPSON: Grandma Green, thank you very much.
MS. GREEN: Thank you.
THE PRESIDENT: Thanks for coming. Medicare is a very important program. However, it has not changed with the times, and that's a fact. And the fundamental question is, how do we change it with the times, so that seniors get the benefit of modern medicine, and they get to choose. That's one of the interesting debates in Washington, is should you allow -- be allowed to choose.
MS. GREEN: Absolutely.
THE PRESIDENT: Well, I think so too, but others don't. Others want the government to make those decisions for you.
MS. GREEN: Why should some bureaucrat tell me what to do? (Laughter.)
SECRETARY THOMPSON: Be nice now, Grandma. (Laughter.)
THE PRESIDENT: Have you ever been to Washington? (Laughter.)
MS. GREEN: I get past those watchdogs that protect the members of Congress. It's 29-year-olds that are running the country. (Laughter.)
SECRETARY THOMPSON: Mr. President, I'd like to move on to -- (laughter) -- more patient control. And I would call upon Lucinda Harmon to give you an update.
THE PRESIDENT: Oh, hi, Lucinda. Thanks for coming.
MS. HARMON: Hello. Thank you so much, Mr. President, and thank you also for your promoting independence initiative while you were Governor and the executive order. I greatly appreciate that. And thank you, Mr. Secretary, for the systems change real choice grants that are currently being funded to the states. They are helping greatly.
There are several issues that are involved in the community of people with disabilities and the aging community because they are overlapping communities greatly. First off, we need more choices for long-term care, and it needs to expand to the entire continuum, from facility all the way to the community-based services. And no matter how much public money is thrown at this issue, it will not be resolved without a public/private partnership. There is no way that federal money can accommodate individual community capacity. It has to be an integrated approach.
Without the community involvement, there won't be community investment and, with it, community capacity will be built. And it will be built in the areas that it's needed, not in the areas that somebody else might think it's needed.
Taking that on and extending it to the individual is absolutely critical, because individuals know what is needed for their own lives. We know how we need to be supported. And the way I need to be supported is not the way that Lex needs to be supported and not the way Grandma needs to be supported. This is a totally individual world. We have an individualized nation, and we need to progress that direction with our support of people with disabilities and people who are aging.
We also need to take the income limitations off of all of our programs for people with disabilities. I want to pay taxes. You don't hear that often. Make note. (Laughter.) I want to pay taxes. I want to be allowed to earn the income and still not lose the benefits.
I'm a well educated person, but I cannot possibly afford the medical care that I require, the equipment that I require. And I want to be able to earn the money to be able to do this, to be able to contribute to it.
Thank you so much.
THE PRESIDENT: Absolutely. Where are you living?
MS. HARMON: I live in Salado, Texas.
THE PRESIDENT: Oh, yes. Right down the road.
MS. HARMON: Yes, sir.
THE PRESIDENT: And what are you doing?
MS. HARMON: I am an educational consultant. I build capacity in terms of community coalitions and grant writing. My company has brought in $2.6 million into the state and into the area, and I make $40 a month.
THE PRESIDENT: So you can get your Medicare benefits.
MS. HARMON: And Medicaid.
THE PRESIDENT: And Medicaid, right.
MS. HARMON: Yes.
THE PRESIDENT: Actually, we've made some progress on the Medicare.
SECRETARY THOMPSON: We are making progress on it.
THE PRESIDENT: In terms of income limitations.
SECRETARY THOMPSON: Lucinda would like to introduce her dog, too.
MS. HARMON: Yes. My dog is part of my personal choice. His name is Quintessential. Quint, baby, wake up. (Laughter.)
THE PRESIDENT: Where is Quint? (Laughter and applause.)
MS. HARMON: He's a part of my individual program. Thank you so much, Mr. President.
THE PRESIDENT: He was afraid I was going to give a speech. (Laughter.)
SECRETARY THOMPSON: Mr. President, the next issue that you have a tremendous passion for is reforming the tort system as far as medical malpractice.
THE PRESIDENT: Yes.
SECRETARY THOMPSON: We're going to call upon Dr. Hill, who is the head of the American Association of Physicians.
DR. HILL: Thank you, Mr. President and Mr. Secretary. I thought I came here to be on your team, but I think I'd rather be on Flora Green's team right now. (Laughter.)
America's patients and physicians are facing a crisis, and I've heard this morning many times it's a malpractice crisis. It's not a malpractice crisis; we have a liability premium crisis. And I wish -- and I'm going to try to teach Secretary Thompson not to say "malpractice crisis" before the day is over. It's a liability premium crisis.
But these litigation costs are driving jury awards totally out of control. And they're forcing doctors in many states to do several things: leave practice, retire, go into another profession, or move to another state that has a more reasonable liability climate, or where the insurance market is a little bit more stable.
And it's not the first liability crisis we've had. This is the fourth one since 1974-'75. And physicians and others in the health care system have looked at it, and we've been offering solutions to the problem, yet in the great part of the country, they've not been adopted. And, of course, we're in a crisis again.
Trial lawyers have fought us every inch of the way, every step of the way. They've pointed fingers to blame everybody, except themselves.
SECRETARY THOMPSON: But your association, Doctor, has got to be with the President and this administration if we're going to win.
MR. HILL: Absolutely. Last month, you know, Nevada closed their level one trauma center for 10 days. I often think of what if I had had a child in a wreck out there at that time. Across the country, women, many women, with good insurance, are unable to get prenatal care, are unable to get delivery care because OBs and family doctors have reduced the number or stopped delivering babies entirely. And in addition to that, a lot of the advanced procedures they're just not going to take the risk of doing any more, because they can't find insurance to cover them.
So we've got states that have out-of-control legal systems and skyrocketing liability premiums. More than 100 physicians have left the state of -- the states of Nevada, West Virginia, Pennsylvania, Mississippi in the last six months. Eighty-one have left Mississippi, 39 of those left because of liability premium crisis. The rest retired, but they retired before the time that they planned to retire. And those doctors aren't coming back.
Governor Guinn and the Nevada legislature had some guts, and they passed some liability. Real leadership was shown there, some meaningful liability. Radiologists in New York and Pennsylvania and Florida are no longer reading mammograms, because of the risk, and they're afraid they're going to be sued. And then there are a whole lot of other states are in crisis. Georgia and New Jersey and New York and Texas are crisis states for us, and there are many others that the crisis is looming.
In 1994, the median jury award in America was $375,000. Six years later, 2000, $1 million. That's a triple in the median jury award. In Nevada, it took 23 cases to destabilize their insurance market and precipitate the crisis -- 23 cases that are responsible for 65 percent of the noneconomic damage awards. Twenty-three cases, 65 percent of the noneconomic damage awards.
Now we know from research and experience that most of the cases are frivolous, but they cost taxpayers a lot of money. A recent report from the Secretary's Health and Human Services showed conservative estimates of the annual costs of defensive medicine, $60 billion, conservative.
Also, the report pointed out very clear that noneconomic damages -- if reasonable limits were put on noneconomic damages, the taxpayers would probably save around $30 billion by reducing federal health care spending. That's a total of $90 billion. So the present system is obviously quite broken, and America's patients need to know that when they want -- need medical care, it's going to be there.
California patients have had that comfort for more than 25 years, and it's working in California. And the rest of America needs it too. So the AMA supports President Bush's proposal. And particularly for the best speech you've ever given in Mississippi last week -- that's a personal opinion -- but it was done extremely well.
And many doctors who we talk to and we say, well, we're going to get liability reform but it's going to take two to three years, they've got to have -- they say, two or three years is too late. We need some hope.
THE PRESIDENT: We've got a real problem. And what America's got to understand, the medical liability problem affects them for two ways. One, it runs up the cost of medicine, it just does. Large settlements and/or frivolous lawsuits makes your health care go up. That is a fact. And, secondly, it -- the liability situation denies some people health care.
I met this guy from Mississippi. He's a fellow that came down from Minnesota, he and his wife. They're pediatricians. They heard a calling to go to a poor community, and now they're leaving Mississippi. They were in the Delta. And they're leaving, because the lawsuits are driving them out.
Not only does the system drive up the cost for the people in the Delta -- the poor people can barely afford it -- now they don't have a pediatrician, or two less pediatricians. And it's sad, and we need to do something about it, in that the -- these lawsuits drive up the cost of medicine, it drives up the cost of medicine to the federal government as well, Medicare, Medicaid, veterans health benefits. So therefore, I believe the federal government ought to act and we ought to have medical malpractice reform across the board. People ought to be able to recover their economic damages.
If you get hurt, if somebody has mistreated you, you ought to have your day in court and you ought to be able to recover what they call economic damages. People ought to be allowed to be treated fairly. But there ought to be a cap on noneconomic damages and on punitive damages. And we ought to have joint and several liability reform. This is a real problem. And I call upon Congress, Doc, and I call upon you to get the people in Congress to act, to understand the crisis.
There are a lot of good docs who aren't going to be docs anymore and people suffer, and that's not right. And so it's time to act on this. I agree with you completely.
And the other thing people have got to understand is these frivolous lawsuits, and there's a lot of them, are not only driving the cost of medicine up, but denies people the chance to get their day in court. And that's a problem, and so we need to move.
For a while, I thought that it ought to be done at the state level. When I realized the cost to the federal treasury, I now believe we ought to have medical liability reform at the federal level, and I'm going to push hard for it. And I need your help. The trial lawyers are very politically powerful. And they're strong. But here in Texas we took them on and got some good medical -- medical malpractice, which evidently had a few loopholes in it.
MR. HILL: Yes, sir, it did.
THE PRESIDENT: But we got some good tort reform across the board, and we need to do it here. We need to do it now in America, before it's too late. The patients get hurt, and the docs get hurt. And one of the things we've got to do is make sure the connection between the doctor and the patient is strong, and that it always remains intact, because that's one of the great things about our medical system.
Anyway, thanks for bringing it up.
SECRETARY THOMPSON: Thank you, Mr. President. Have you got time for one more subject?
THE PRESIDENT: Yes.
SECRETARY THOMPSON: I'm going to call upon a businessman, David Ness, to talk about how difficult it is with health insurance, and what they're trying to do to make sure that they have health insurance for their employees.
MR. NESS: Thank you, Secretary Thompson.
THE PRESIDENT: Where do you live, David?
MR. NESS: Minneapolis, Minnesota.
THE PRESIDENT: Good.
SECRETARY THOMPSON: It's a suburb of Wisconsin, Mr. President. (Laughter.)
THE PRESIDENT: He tried that line in Minnesota, by the way. (Laughter.)
MR. NESS: Like Wisconsin, we have three days of summer. (Laughter.)
THE PRESIDENT: That's right.
MR. NESS: I work at the -- great pleasure working for a very good company, a medical device company. It provides solutions for people with chronic disease. And we have over 20,000 employees in the U.S. Our medical expenses are over $81 million. They're increasing significantly, however we've been able to, through I think rather creative approaches, arrest that increase. And the model, we think, provides the greatest opportunities for consumers and the public. It's a defined contribution medical plan that we offer in conjunction with other plans.
The reason why we believe this will work is three-fold. Number one, it really changes the way we deliver health care. It puts the patient, the employee, their family at the center of that decisionmaking, creating a partnership with your doctor, to determine what's the best care. It's them, not the plan, that decides what the care should be.
Secondly, in order to do this, we have to have good information. There's a lot of information out there, but very little of it is really delivered in a way that employees can use it, patients can use it to make the best care. But we have a model where every employee has their own website. And that website has data on -- that they loaded on, on health history, it has access to Johns Hopkins Medical Library, it has access to the credentialing of doctors they might want to go see it, it has access to prices for drugs. It's having good data that allows these people to make the right decisions.
The third thing is economic realignment. The current system is really not right. On most plans, if somebody goes in for a major operation, they think the cost is $100. No, it was probably thousands and thousands and thousands of dollars. It's crazy. Our system -- if every employee can see every cost that was spent on them, the cost of the doctors, the cost of the nurses, the cost of the hospital, because then you think people are using that money wisely.
And most importantly, every employee has a personal care account, dollars that they spend. And I thank you. We made a bet two years ago that this administration would do something, and it did something, allowing that personal care account not to be taxable, but to roll over, as long as it's used for medical care.
So by doing those three things, we think we've changed the system to make employees at the center of their health, investing in their health through preventative care and through spending their money wisely.
THE PRESIDENT: Yes, medical savings accounts, whatever you want to call them, are very important for providing proper incentive, and keeping the relationship between the patient and the doctor. I hope that Americans understand that if they walk 20 minutes a day, they'd get out and exercise, the amount of money they can save for their families; that there is such a thing as preventative care; and by making right choices, that people can really save a lot of money, and if the system encourages those savings, that in itself is just as well.
I appreciate you bringing that up. We've kind of lost sight of who is responsible for what. Part of it has to do with the size of government, part of it has to do with the health insurance phenomenon that is taking place. And the notion is to kind of -- we talked about individualized medicine, but as you individualize medicine, individuals have to make better choices, too. And that's going to be crucial for the future of the country.
Listen, thank you all for coming. I promise you I will listen to what has been said here, even though I wasn't here. And we will distill the ideas and the comments. This is -- this is an important subject for the country because, as I mentioned earlier, good health care will yield to better economic security. It's hard to feel economically secure if you're worried about your health. It's hard to feel economically secure if the health care systems don't enable you to really realize your full potential. And so the ideas that you bring forth are important.
Tommy is doing a fabulous job running Health and Human Services. It's a -- Health and Human Services, the budget and the amount of influence it has on our society is enormous. And Tommy is a good listener, and he's a pretty good actor, too. He can get things done. Action man, we call him.
But I want to thank you all for coming. I think you'll be impressed by the quality of folks who have shown up here. I don't know if you've had a chance to mingle, but it's -- I've been very impressed. I've been very thankful that a lot of our national experts have come to talk about a variety of subjects. Really what we're talking about is confidence in our future. I've got great confidence in the future of our country, because I understand America. I know what we're made out of. And obviously we've got some problems we need to address.
But one problem we don't have to address is the fundamental character of the country, the fundamental nature of the American people are resilient and strong. We talked a little bit in these other seminars about how some have let us down, cheated, didn't tell the truth when it comes to their numbers on their balance sheets. And we'll find those, and hold them to account. But by far, the vast majority of Americans are really decent, honorable people.
So thanks for coming to Central Texas. I know it's a lot to ask to come here in the middle of August -- (laughter) -- but it's worthwhile, it's worthwhile. God bless you all. (Applause.)
END 10:30 A.M. CDT