[House Document 111-62]
[From the U.S. Government Printing Office]

111th Congress, 1st Session - - - - - - - - - - - - - House Document 111-62








 September 10, 2009.--Message and accompanying papers referred to the 
 Committee on the Whole House on the State of the Union and ordered to 
                               be printed
    To the Congress of the United States:
    When I spoke here last winter, this Nation was facing the 
worst economic crisis since the Great Depression. We were 
losing an average of 700,000 jobs per month. Credit was frozen. 
And our financial system was on the verge of collapse.
    As any American who is still looking for work or a way to 
pay their bills will tell you, we are by no means out of the 
woods. A full and vibrant recovery is many months away. And I 
will not let up until those Americans who seek jobs can find 
them; until those businesses that seek capital and credit can 
thrive; until all responsible homeowners can stay in their 
homes. That is our ultimate goal. But thanks to the bold and 
decisive action we have taken since January, I can stand here 
with confidence and say that we have pulled this economy back 
from the brink.
    I want to thank the members of this body for your efforts 
and your support in these last several months, and especially 
those who have taken the difficult votes that have put us on a 
path to recovery. I also want to thank the American people for 
their patience and resolve during this trying time for our 
    But we did not come here just to clean up crises. We came 
to build a future. So tonight, I return to speak to all of you 
about an issue that is central to that future--and that is the 
issue of health care.
    I am not the first President to take up this cause, but I 
am determined to be the last. It has now been nearly a century 
since Theodore Roosevelt first called for health care reform. 
And ever since, nearly every President and Congress, whether 
Democrat or Republican, has attempted to meet this challenge in 
some way. A bill for comprehensive health reform was first 
introduced by John Dingell Sr. in 1943. Sixty-five years later, 
his son continues to introduce that same bill at the beginning 
of each session.
    Our collective failure to meet this challenge--year after 
year, decade after decade--has led us to a breaking point. 
Everyone understands the extraordinary hardships that are 
placed on the uninsured, who live every day just one accident 
or illness away from bankruptcy. These are not primarily people 
on welfare. These are middle-class Americans. Some can't get 
insurance on the job. Others are self-employed, and can't 
afford it, since buying insurance on your own costs you three 
times as much as the coverage you get from your employer. Many 
other Americans who are willing and able to pay are still 
denied insurance due to previous illnesses or conditions that 
insurance companies decide are too risky or expensive to cover.
    We are the only advanced democracy on Earth--the only 
wealthy nation--that allows such hardships for millions of its 
people. There are now more than 30 million American citizens 
who cannot get coverage. In just a 2-year period, one in every 
three Americans goes without health care coverage at some 
point. And every day, 14,000 Americans lose their coverage. In 
other words, it can happen to anyone.
    But the problem that plagues the health care system is not 
just a problem of the uninsured. Those who do have insurance 
have never had less security and stability than they do today. 
More and more Americans worry that if you move, lose your job, 
or change your job, you'll lose your health insurance too. More 
and more Americans pay their premiums, only to discover that 
their insurance company has dropped their coverage when they 
get sick, or won't pay the full cost of care. It happens every 
    One man from Illinois lost his coverage in the middle of 
chemotherapy because his insurer found that he hadn't reported 
gallstones that he didn't even know about. They delayed his 
treatment, and he died because of it. Another woman from Texas 
was about to get a double mastectomy when her insurance company 
canceled her policy because she forgot to declare a case of 
acne. By the time she had her insurance reinstated, her breast 
cancer more than doubled in size. That is heart-breaking, it is 
wrong, and no one should be treated that way in the United 
States of America.
    Then there's the problem of rising costs. We spend one-and-
a-half times more per person on health care than any other 
country, but we aren't any healthier for it. This is one of the 
reasons that insurance premiums have gone up three times faster 
than wages. It's why so many employers--especially small 
businesses--are forcing their employees to pay more for 
insurance, or are dropping their coverage entirely. It's why so 
many aspiring entrepreneurs cannot afford to open a business in 
the first place, and why American businesses that compete 
internationally--like our automakers--are at a huge 
disadvantage. And it's why those of us with health insurance 
are also paying a hidden and growing tax for those without it--
about $1000 per year that pays for somebody else's emergency 
room and charitable care.
    Finally, our health care system is placing an unsustainable 
burden on taxpayers. When health care costs grow at the rate 
they have, it puts greater pressure on programs like Medicare 
and Medicaid. If we do nothing to slow these skyrocketing 
costs, we will eventually be spending more on Medicare and 
Medicaid than every other government program combined. Put 
simply, our health care problem is our deficit problem. Nothing 
else even comes close.
    These are the facts. Nobody disputes them. We know we must 
reform this system. The question is how.
    There are those on the left who believe that the only way 
to fix the system is through a single-payer system like 
Canada's, where we would severely restrict the private 
insurance market and have the government provide coverage for 
everyone. On the right, there are those who argue that we 
should end the employer-based system and leave individuals to 
buy health insurance on their own.
    I have to say that there are arguments to be made for both 
approaches. But either one would represent a radical shift that 
would disrupt the health care most people currently have. Since 
health care represents one-sixth of our economy, I believe it 
makes more sense to build on what works and fix what doesn't, 
rather than try to build an entirely new system from scratch. 
And that is precisely what those of you in Congress have tried 
to do over the past several months.
    During that time, we have seen Washington at its best and 
its worst.
    We have seen many in this chamber work tirelessly for the 
better part of this year to offer thoughtful ideas about how to 
achieve reform. Of the five committees asked to develop bills, 
four have completed their work, and the Senate Finance 
Committee announced today that it will move forward next week. 
That has never happened before. Our overall efforts have been 
supported by an unprecedented coalition of doctors and nurses; 
hospitals, seniors' groups and even drug companies--many of 
whom opposed reform in the past. And there is agreement in this 
chamber on about 80 percent of what needs to be done, putting 
us closer to the goal of reform than we have ever been.
    But what we have also seen in these last months is the same 
partisan spectacle that only hardens the disdain many Americans 
have toward their own government. Instead of honest debate, we 
have seen scare tactics. Some have dug into unyielding 
ideological camps that offer no hope of compromise. Too many 
have used this as an opportunity to score short-term political 
points, even if it robs the country of our opportunity to solve 
a long-term challenge. And out of this blizzard of charges and 
counter-charges, confusion has reigned.
    Well the time for bickering is over. The time for games has 
passed. Now is the season for action. Now is when we must bring 
the best ideas of both parties together and show the American 
people that we can still do what we were sent here to do. Now 
is the time to deliver on health care.
    The plan I'm announcing tonight would meet three basic 
    It will provide more security and stability to those who 
have health insurance. It will provide insurance to those who 
don't. And it will slow the growth of health care costs for our 
families, our businesses, and our government. It's a plan that 
asks everyone to take responsibility for meeting this 
challenge--not just government and insurance companies, but 
employers and individuals. And it's a plan that incorporates 
ideas from Senators and Congressmen; from Democrats and 
Republicans--and yes, from some of my opponents in both the 
primary and general election.
    Here are the details that every American needs to know 
about this plan:
    First, if you are among the hundreds of millions of 
Americans who already have health insurance through your job, 
Medicare, Medicaid, or the VA, nothing in this plan will 
require you or your employer to change the coverage or the 
doctor you have. Let me repeat this: nothing in our plan 
requires you to change what you have.
    What this plan will do is to make the insurance you have 
work better for you. Under this plan, it will be against the 
law for insurance companies to deny you coverage because of a 
pre-existing condition. As soon as I sign this bill, it will be 
against the law for insurance companies to drop your coverage 
when you get sick or water it down when you need it most. They 
will no longer be able to place some arbitrary cap on the 
amount of coverage you can receive in a given year or a 
lifetime. We will place a limit on how much you can be charged 
for out-of-pocket expenses, because in the United States of 
America, no one should go broke because they get sick. And 
insurance companies will be required to cover, with no extra 
charge, routine checkups and preventive care, like mammograms 
and colonoscopies--because there's no reason we shouldn't be 
catching diseases like breast cancer and colon cancer before 
they get worse. That makes sense, it saves money, and it saves 
    That's what Americans who have health insurance can expect 
from this plan--more security and stability.
    Now, if you're one of the tens of millions of Americans who 
don't currently have health insurance, the second part of this 
plan will finally offer you quality, affordable choices. If you 
lose your job or change your job, you will be able to get 
coverage. If you strike out on your own and start a small 
business, you will be able to get coverage. We will do this by 
creating a new insurance exchange--a marketplace where 
individuals and small businesses will be able to shop for 
health insurance at competitive prices. Insurance companies 
will have an incentive to participate in this exchange because 
it lets them compete for millions of new customers. As one big 
group, these customers will have greater leverage to bargain 
with the insurance companies for better prices and quality 
coverage. This is how large companies and government employees 
get affordable insurance. It's how everyone in this Congress 
gets affordable insurance. And it's time to give every American 
the same opportunity that we've given ourselves.
    For those individuals and small businesses who still cannot 
afford the lower-priced insurance available in the exchange, we 
will provide tax credits, the size of which will be based on 
your need. And all insurance companies that want access to this 
new marketplace will have to abide by the consumer protections 
I already mentioned. This exchange will take effect in 4 years, 
which will give us time to do it right. In the meantime, for 
those Americans who can't get insurance today because they have 
pre-existing medical conditions, we will immediately offer low-
cost coverage that will protect you against financial ruin if 
you become seriously ill. This was a good idea when Senator 
John McCain proposed it in the campaign, it's a good idea now, 
and we should embrace it.
    Now, even if we provide these affordable options, there may 
be those--particularly the young and healthy--who still want to 
take the risk and go without coverage. There may still be 
companies that refuse to do right by their workers. The problem 
is, such irresponsible behavior costs all the rest of us money. 
If there are affordable options and people still don't sign up 
for health insurance, it means we pay for those people's 
expensive emergency room visits. If some businesses don't 
provide workers health care, it forces the rest of us to pick 
up the tab when their workers get sick, and gives those 
businesses an unfair advantage over their competitors. And 
unless everybody does their part, many of the insurance reforms 
we seek--especially requiring insurance companies to cover pre-
existing conditions--just can't be achieved.
    That's why under my plan, individuals will be required to 
carry basic health insurance--just as most States require you 
to carry auto insurance. Likewise, businesses will be required 
to either offer their workers health care, or chip in to help 
cover the cost of their workers. There will be a hardship 
waiver for those individuals who still cannot afford coverage, 
and 95% of all small businesses, because of their size and 
narrow profit margin, would be exempt from these requirements. 
But we cannot have large businesses and individuals who can 
afford coverage game the system by avoiding responsibility to 
themselves or their employees. Improving our health care system 
only works if everybody does their part.
    While there remain some significant details to be ironed 
out, I believe a broad consensus exists for the aspects of the 
plan I just outlined: consumer protections for those with 
insurance, an exchange that allows individuals and small 
businesses to purchase affordable coverage, and a requirement 
that people who can afford insurance get insurance.
    And I have no doubt that these reforms would greatly 
benefit Americans from all walks of life, as well as the 
economy as a whole. Still, given all the misinformation that's 
been spread over the past few months, I realize that many 
Americans have grown nervous about reform. So tonight I'd like 
to address some of the key controversies that are still out 
    Some of people's concerns have grown out of bogus claims 
spread by those whose only agenda is to kill reform at any 
cost. The best example is the claim, made not just by radio and 
cable talk show hosts, but prominent politicians, that we plan 
to set up panels of bureaucrats with the power to kill off 
senior citizens. Such a charge would be laughable if it weren't 
so cynical and irresponsible. It is a lie, plain and simple.
    There are also those who claim that our reform effort will 
insure illegal immigrants. This, too, is false--the reforms I'm 
proposing would not apply to those who are here illegally. And 
one more misunderstanding I want to clear up--under our plan, 
no Federal dollars will be used to fund abortions, and Federal 
conscience laws will remain in place.
    My health care proposal has also been attacked by some who 
oppose reform as a ``government takeover'' of the entire health 
care system. As proof, critics point to a provision in our plan 
that allows the uninsured and small businesses to choose a 
publicly-sponsored insurance option, administered by the 
government just like Medicaid or Medicare.
    So let me set the record straight. My guiding principle is, 
and always has been, that consumers do better when there is 
choice and competition. Unfortunately, in 34 States, 75% of the 
insurance market is controlled by five or fewer companies. In 
Alabama, almost 90% is controlled by just one company. Without 
competition, the price of insurance goes up and the quality 
goes down. And it makes it easier for insurance companies to 
treat their customers badly--by cherry-picking the healthiest 
individuals and trying to drop the sickest; by overcharging 
small businesses who have no leverage; and by jacking up rates.
    Insurance executives don't do this because they are bad 
people. They do it because it's profitable. As one former 
insurance executive testified before Congress, insurance 
companies are not only encouraged to find reasons to drop the 
seriously ill; they are rewarded for it. All of this is in 
service of meeting what this former executive called ``Wall 
Street's relentless profit expectations.''
    Now, I have no interest in putting insurance companies out 
of business. They provide a legitimate service, and employ a 
lot of our friends and neighbors. I just want to hold them 
accountable. The insurance reforms that I've already mentioned 
would do just that. But an additional step we can take to keep 
insurance companies honest is by making a not-for-profit public 
option available in the insurance exchange. Let me be clear--it 
would only be an option for those who don't have insurance. No 
one would be forced to choose it, and it would not impact those 
of you who already have insurance. In fact, based on 
Congressional Budget Office estimates, we believe that less 
than 5% of Americans would sign up.
    Despite all this, the insurance companies and their allies 
don't like this idea. They argue that these private companies 
can't fairly compete with the government. And they'd be right 
if taxpayers were subsidizing this public insurance option. But 
they won't be. I have insisted that like any private insurance 
company, the public insurance option would have to be self-
sufficient and rely on the premiums it collects. But by 
avoiding some of the overhead that gets eaten up at private 
companies by profits, excessive administrative costs, and 
executive salaries, it could provide a good deal for consumers. 
It would also keep pressure on private insurers to keep their 
policies affordable and treat their customers better, the same 
way public colleges and universities provide additional choice 
and competition to students without in any way inhibiting a 
vibrant system of private colleges and universities.
    It's worth noting that a strong majority of Americans still 
favor a public insurance option of the sort I've proposed 
tonight. But its impact shouldn't be exaggerated--by the left, 
the right, or the media. It is only one part of my plan, and 
should not be used as a handy excuse for the usual Washington 
ideological battles. To my progressive friends, I would remind 
you that for decades, the driving idea behind reform has been 
to end insurance company abuses and make coverage affordable 
for those without it. The public option is only a means to that 
end--and we should remain open to other ideas that accomplish 
our ultimate goal. And to my Republican friends, I say that 
rather than making wild claims about a government takeover of 
health care, we should work together to address any legitimate 
concerns you may have.
    For example, some have suggested that that the public 
option go into effect only in those markets where insurance 
companies are not providing affordable policies. Others propose 
a co-op or another non-profit entity to administer the plan. 
These are all constructive ideas worth exploring. But I will 
not back down on the basic principle that if Americans can't 
find affordable coverage, we will provide you with a choice. 
And I will make sure that no government bureaucrat or insurance 
company bureaucrat gets between you and the care that you need.
    Finally, let me discuss an issue that is a great concern to 
me, to members of this chamber, and to the public--and that is 
how we pay for this plan.
    Here's what you need to know. First, I will not sign a plan 
that adds one dime to our deficits--either now or in the 
future. Period. And to prove that I'm serious, there will be a 
provision in this plan that requires us to come forward with 
more spending cuts if the savings we promised don't 
materialize. Part of the reason I faced a trillion dollar 
deficit when I walked in the door of the White House is because 
too many initiatives over the last decade were not paid for--
from the Iraq War to tax breaks for the wealthy. I will not 
make that same mistake with health care.
    Second, we've estimated that most of this plan can be paid 
for by finding savings within the existing health care system--
a system that is currently full of waste and abuse. Right now, 
too much of the hard-earned savings and tax dollars we spend on 
health care doesn't make us healthier. That's not my judgment--
it's the judgment of medical professionals across this country. 
And this is also true when it comes to Medicare and Medicaid.
    In fact, I want to speak directly to America's seniors for 
a moment, because Medicare is another issue that's been 
subjected to demagoguery and distortion during the course of 
this debate.
    More than 4 decades ago, this Nation stood up for the 
principle that after a lifetime of hard work, our seniors 
should not be left to struggle with a pile of medical bills in 
their later years. That is how Medicare was born. And it 
remains a sacred trust that must be passed down from one 
generation to the next. That is why not a dollar of the 
Medicare trust fund will be used to pay for this plan.
    The only thing this plan would eliminate is the hundreds of 
billions of dollars in waste and fraud, as well as unwarranted 
subsidies in Medicare that go to insurance companies--subsidies 
that do everything to pad their profits and nothing to improve 
your care. And we will also create an independent commission of 
doctors and medical experts charged with identifying more waste 
in the years ahead.
    These steps will ensure that you--America's seniors--get 
the benefits you've been promised. They will ensure that 
Medicare is there for future generations. And we can use some 
of the savings to fill the gap in coverage that forces too many 
seniors to pay thousands of dollars a year out of their own 
pocket for prescription drugs. That's what this plan will do 
for you. So don't pay attention to those scary stories about 
how your benefits will be cut--especially since some of the 
same folks who are spreading these tall tales have fought 
against Medicare in the past, and just this year supported a 
budget that would have essentially turned Medicare into a 
privatized voucher program. That will never happen on my watch. 
I will protect Medicare.
    Now, because Medicare is such a big part of the health care 
system, making the program more efficient can help usher in 
changes in the way we deliver health care that can reduce costs 
for everybody. We have long known that some places, like the 
Intermountain Healthcare in Utah or the Geisinger Health System 
in rural Pennsylvania, offer high-quality care at costs below 
average. The commission can help encourage the adoption of 
these common-sense best practices by doctors and medical 
professionals throughout the system--everything from reducing 
hospital infection rates to encouraging better coordination 
between teams of doctors.
    Reducing the waste and inefficiency in Medicare and 
Medicaid will pay for most of this plan. Much of the rest would 
be paid for with revenues from the very same drug and insurance 
companies that stand to benefit from tens of millions of new 
customers. This reform will charge insurance companies a fee 
for their most expensive policies, which will encourage them to 
provide greater value for the money--an idea which has the 
support of Democratic and Republican experts. And according to 
these same experts, this modest change could help hold down the 
cost of health care for all of us in the long-run.
    Finally, many in this chamber--particularly on the 
Republican side of the aisle--have long insisted that reforming 
our medical malpractice laws can help bring down the cost of 
health care. I don't believe malpractice reform is a silver 
bullet, but I have talked to enough doctors to know that 
defensive medicine may be contributing to unnecessary costs. So 
I am proposing that we move forward on a range of ideas about 
how to put patient safety first and let doctors focus on 
practicing medicine. I know that the Bush Administration 
considered authorizing demonstration projects in individual 
States to test these issues. It's a good idea, and I am 
directing my Secretary of Health and Human Services to move 
forward on this initiative today.
    Add it all up, and the plan I'm proposing will cost around 
$900 billion over 10 years--less than we have spent on the Iraq 
and Afghanistan wars, and less than the tax cuts for the 
wealthiest few Americans that Congress passed at the beginning 
of the previous administration. Most of these costs will be 
paid for with money already being spent--but spent badly--in 
the existing health care system. The plan will not add to our 
deficit. The middle-class will realize greater security, not 
higher taxes. And if we are able to slow the growth of health 
care costs by just one-tenth of one percent each year, it will 
actually reduce the deficit by $4 trillion over the long term.
    This is the plan I'm proposing. It's a plan that 
incorporates ideas from many of the people in this room 
tonight--Democrats and Republicans. And I will continue to seek 
common ground in the weeks ahead. If you come to me with a 
serious set of proposals, I will be there to listen. My door is 
always open.
    But know this: I will not waste time with those who have 
made the calculation that it's better politics to kill this 
plan than improve it. I will not stand by while the special 
interests use the same old tactics to keep things exactly the 
way they are. If you misrepresent what's in the plan, we will 
call you out. And I will not accept the status quo as a 
solution. Not this time. Not now.
    Everyone in this room knows what will happen if we do 
nothing. Our deficit will grow. More families will go bankrupt. 
More businesses will close. More Americans will lose their 
coverage when they are sick and need it most. And more will die 
as a result. We know these things to be true.
    That is why we cannot fail. Because there are too many 
Americans counting on us to succeed--the ones who suffer 
silently, and the ones who shared their stories with us at town 
hall meetings, in emails, and in letters.
    I received one of those letters a few days ago. It was from 
our beloved friend and colleague, Ted Kennedy. He had written 
it back in May, shortly after he was told that his illness was 
terminal. He asked that it be delivered upon his death.
    In it, he spoke about what a happy time his last months 
were, thanks to the love and support of family and friends, his 
wife, Vicki, and his children, who are here tonight . And he 
expressed confidence that this would be the year that health 
care reform--``that great unfinished business of our society,'' 
he called it--would finally pass. He repeated the truth that 
health care is decisive for our future prosperity, but he also 
reminded me that ``it concerns more than material things.'' 
``What we face,'' he wrote, ``is above all a moral issue; at 
stake are not just the details of policy, but fundamental 
principles of social justice and the character of our 
    I've thought about that phrase quite a bit in recent days--
the character of our country. One of the unique and wonderful 
things about America has always been our self-reliance, our 
rugged individualism, our fierce defense of freedom, and our 
healthy skepticism of government. And figuring out the 
appropriate size and role of government has always been a 
source of rigorous and sometimes angry debate.
    For some of Ted Kennedy's critics, his brand of liberalism 
represented an affront to American liberty. In their mind, his 
passion for universal health care was nothing more than a 
passion for big government.
    But those of us who knew Teddy and worked with him here--
people of both parties--know that what drove him was something 
more. His friend, Orrin Hatch, knows that. They worked together 
to provide children with health insurance. His friend John 
McCain knows that. They worked together on a Patient's Bill of 
Rights. His friend Chuck Grassley knows that. They worked 
together to provide health care to children with disabilities.
    On issues like these, Ted Kennedy's passion was born not of 
some rigid ideology, but of his own experience. It was the 
experience of having two children stricken with cancer. He 
never forgot the sheer terror and helplessness that any parent 
feels when a child is badly sick; and he was able to imagine 
what it must be like for those without insurance; what it would 
be like to have to say to a wife or a child or an aging 
parent--there is something that could make you better, but I 
just can't afford it.
    That large-heartedness--that concern and regard for the 
plight of others--is not a partisan feeling. It is not a 
Republican or a Democratic feeling. It, too, is part of the 
American character. Our ability to stand in other people's 
shoes. A recognition that we are all in this together; that 
when fortune turns against one of us, others are there to lend 
a helping hand. A belief that in this country, hard work and 
responsibility should be rewarded by some measure of security 
and fair play; and an acknowledgement that sometimes government 
has to step in to help deliver on that promise.
    This has always been the history of our progress. In 1935, 
when over half of our seniors could not support themselves and 
millions had seen their savings wiped away, there were those 
who argued that Social Security would lead to socialism. But 
the men and women of Congress stood fast, and we are all the 
better for it. In 1965, when some argued that Medicare 
represented a government takeover of health care, members of 
Congress, Democrats and Republicans, did not back down. They 
joined together so that all of us could enter our golden years 
with some basic peace of mind.
    You see, our predecessors understood that government could 
not, and should not, solve every problem. They understood that 
there are instances when the gains in security from government 
action are not worth the added constraints on our freedom. But 
they also understood that the danger of too much government is 
matched by the perils of too little; that without the leavening 
hand of wise policy, markets can crash, monopolies can stifle 
competition, and the vulnerable can be exploited. And they knew 
that when any government measure, no matter how carefully 
crafted or beneficial, is subject to scorn; when any efforts to 
help people in need are attacked as un-American; when facts and 
reason are thrown overboard and only timidity passes for 
wisdom, and we can no longer even engage in a civil 
conversation with each other over the things that truly 
matter--that at that point we don't merely lose our capacity to 
solve big challenges. We lose something essential about 
    What was true then remains true today. I understand how 
difficult this health care debate has been. I know that many in 
this country are deeply skeptical that government is looking 
out for them. I understand that the politically safe move would 
be to kick the can further down the road--to defer reform one 
more year, or one more election, or one more term.
    But that's not what the moment calls for. That's not what 
we came here to do. We did not come to fear the future. We came 
here to shape it. I still believe we can act even when it's 
hard. I still believe we can replace acrimony with civility, 
and gridlock with progress. I still believe we can do great 
things, and that here and now we will meet history's test.
    Because that is who we are. That is our calling. That is 
our character. Thank you, God Bless You, and may God Bless the 
United States of America.

                                                      Barack Obama.
    The White House, September 9, 2009.