For Immediate Release
June 24, 2009

     GRASSLEY:  Along with continuing efforts to try to find an

agreement on bipartisan health care reform legislation, my work

continues to bring about disclosure of financial ties between

pharmaceutical drug industry and doctors.  And not implying that

there's anything wrong with that, but implying that all of this

information ought to be transparent the same way that I have to file

an ethics report every year on my income and outgo and my investments,

and the same way that I have to file with the FEC campaign

contributions so that there's absolutely full disclosure of every

penny that I get for the public to know that.  And, in the instance of

the last one, for a voter to know it.

 

     So, today, continuing this drive towards transparency, I am

asking 23 medical schools for information about their policies for

disclosure.  These 23 schools declined to respond to a recent survey

conducted by the American Medical Student Association which

association is, to some extent, trying to do some of the things about

transparency and about university practices the same way that I'm

trying to do in my investigations.

 

     My argument is that there's just a terrible lots of skepticism

about financial relationships between doctors and drug companies.

Disclosures of those ties would help it build confidence that there's

nothing to hide.  Requiring disclosure is common-sense reform based on

public dollars and public trust at stake in medical training, medical

research, and the practice of medicine.

 

     One hundred million Americans received medical care under

Medicare and Medicaid.  The National Institutes of Health, alone,

awards $24 billion in federal grants every year for medical research.

In addition to building pressure for disclosure through oversight

investigation, I sponsored legislation to require public reporting of

drug companies and money to physicians.

 

     And some people might ask, well, if you've got some doubts about

this being a conflict that is something wrong, I hasten to add that I

think transparency will take care of a lot of problems.  And if it

doesn't, then I'll consider legislation down the road.  But I have

found in the past in so many of my investigations that transparency

brings about a great deal of accountability.  And accountability is

what government ought to be about.

 

     I'm ready for questions, and I'll start with -- let's see.  The

first person is Jason with Des Moines Register.

 

     QUESTION:  Hi, Senator.  Thanks for taking my question.

 

     The New York Times has a poll out that's showing that 50 percent

of Americans who describe themselves as Republican support a public

health care plan.  Can you comment a little bit on this and why so few

Republicans in the Senate support the public option?

 

     GRASSLEY:  Yes.  That's a real easy question to answer.  First of

all, commentary on the poll because I think you and I and a lot of us

would use polls to give credibility to certain positions.  And from

that standpoint, you know, we have researched that poll.  And it's got

a -- I don't have the exact percentage, but it's just got a tremendous

amount of heavy weighting towards Democrats.  And the figure -- there

is a real figure.  And I don't think it's 2 to 1.  But it is a poll

that's overwhelmingly weighted with Democrat opinion.  And you tend to

get that view about a public option more from Democrats than you do

from Republicans or independents.

 

     Then the other thing is you want it question the New York Times

poll anyway because they showed John McCain losing by 24 percentage

points where he only lost by seven percentage points.  So I think the

poll is in question.  Plus, there are other polls; one by Wyth, I

think it is -- W-Y-T-H -- or something -- that showed a whole

different attitude about this.

 

     And the bottom line of it is that -- that you -- your question is

legitimate, but you shouldn't use the New York Times poll.  Now, you

can disagree with me on that, and I'll respect your judgment.

 

     So let me answer your question.  We -- the issue with public

option is more competition.  We're working on more competition through

what we call a co-op plan.  This would be co-ops like we've known them

for 150 years, and we're well acquainted with them in Iowa and have

co-ops -- if there's any vacuum to be filled for them to fill it.

 

     In other words, if there's a need for competition, this would

help competition.  And this is something that we think we can get

bipartisan support for.  Where there's no bipartisan support for the

public option as it came out of the White House or that it's in the

health bill as an example, the Health Committee bill.

 

 

     GRASSLEY:  Also, it's a little ludicrous to me to think that you

need a public option when our whole goal in the bill is accessibility

for the people that don't have insurance and affordability for people

that don't have insurance.

 

     And let me address the affordability part.  There's people that

could get insurance don't get it because they can't afford it.  So if

they're low income, there will be subsidy so people can have

insurance.

 

     The other thing is that if we're going to do away with

discrimination for pre-existing conditions in health insurance, so

there's some people that have health insurance could get it even with

pre-existing conditions but they can't afford it.  So we'll have

community rating to help.

 

     So if we're going to get all of the people in this country

capable of having health insurance and it's going to be affordable,

then I don't understand just exactly what the -- what the whole

argument for public option is.  And I know -- I'm well aware of your

-- the editorializing of things of that nature.  So -- in favor of it.

 

     And I read your editorials and everything, but that's where I'm

coming from is that it's not needed because of access for everybody

and affordability for everybody.

 

     QUESTION:  Thank you, Senator.

 

     GRASSLEY:  Yes.

 

     Mike Myers?

 

     QUESTION:  Well, Senator, what happens to bipartisanship on this?

Does it still exist?  Is it on life support?  I'm talking about

Senator Baucus, of course.

 

     GRASSLEY:  Well, there's only -- now, unlike maybe last week when

we interviewed, there's only one opportunity for bipartisanship, and

it's in the Finance Committee because Health Committee is very

partisan.  And it looks like the House of Representatives is going to

be very partisan, although, there will be Republican bills other than

a bipartisan bill.

 

     So as of six o'clock last night, Senator Baucus and I were still

talking, trying to iron out policy and still the same big things that

we've been talking about but trying to find middle ground.  Now, what

I can't comment on -- maybe you can find out later -- is has this

changed since six o'clock because Senator Baucus had to go to a

meeting with Reid and several members of the Democrat caucus and Rahm

Emanuel.

 

     And so maybe this has changed.  But as of last night at six

o'clock, we were still on the same bipartisan track.

 

     Mike Glover?

 

     QUESTION:  One...

 

     GRASSLEY:  Oh, Mike Myers, follow-up.

 

     QUESTION:  Just briefly.  Is this artificial deadline -- pardon

me if that sounds partisan -- of getting this bill done this year, is

that going to help or hurt you that you...

 

     GRASSLEY:  Well,

 

     QUESTION:  Some people say you're rushing to put together a bill

that may have a lot of flaws and give yourselves some more time.

 

     GRASSLEY:  Well, I feel that it's being rushed, but I've been

part of the rushing because I've been working with Senator Baucus to

get it done.  So I may be part of the problem, too.  But I think

deadlines are important.  Now, deadlines have slipped a week already.

And, you know, a week ago, I wouldn't have said that.  But it's

slipped a week.

 

     But on the other hand, I do feel, based upon comments that Lugar

made on Sunday on a television program I was on, Senator Feinstein was

on the same program, based upon what I'm hearing from people in my

caucus and you add together a few Democrats and 40 Republicans and

you've got a large share of the Senate feeling that we're moving too

quickly not based upon lack of need for change, but just to make sure

that the change is right because I can still report to you that I

haven't had anybody in my caucus say that we don't need to reform

health care.

 

     Mike Glover?

 

     QUESTION:  Yes, Senator.  You have said in the past that a health

care expansion bill will pass this year.  Will it be significant?

Will people know?

 

     GRASSLEY:  I lost you when you said "will people know."

 

     QUESTION:   Will people feel the change?  In other words, it

be...

 

     GRASSLEY:  Oh.  This is a...

 

     QUESTION:  ... a significant change in health care?

 

     GRASSLEY:  Well, now, I'm giving you kind of a -- of a -- of a

perception I have that I think the voters might have, and it goes

directly to your question.  You know, one -- one thing about politics

is -- and policy -- you should under promise and overproduce.  And I

think this is a case where we could be overpromising and

under producing, but that's a fear I have.

 

     I hope it doesn't materialize.  But the back of my mind, I think

that fear.  Then let's go to your question.  There's such a slow

phase-in for some parts of -- of a bipartisan bill that -- and certain

savings from Medicare that are going to be phased in and then certain

additional income from people who aren't insured being insured going

to be phased in.

 

     And I think that, from the standpoint, we could pass a bill, the

president could sign it tomorrow and people are going to say a year

from now what good did it do because they see us passing something,

and the president signs it.  They expect things to be different the

next day, and they aren't going to be different.

 

     Even on prescription drugs for seniors, we had to phase that in

over a two-year period until it was fully implemented.  And this is

much bigger than that.  And so people are not going to see change

immediately.

 

     But we're -- we're doing thing that we think are going to bring

about better care through concentration on five or six maladies that

are -- that are chronic illnesses that take up 80 percent of it,

through coordination of care, through emphasis upon preventive

medicine, through doing away with the perverse incentives that are in

the Medicare program today and maybe, to some extent, in private

insurance where the doctor says to you I want to see you every day and

twice to Sunday because he thinks that you -- the more often he sees

you, the more money he's going to.

 

     We want to change that to reimbursement based on pay for

performance, and coordination of care implies that, you know, there's

going to be payment made for -- for quality, and, in a sense, keeping

people out of hospitals or make sure you do it right the first time so

they don't get readmitted like 20 percent of the people do one more

after they get out.

 

     And these are our plans.  But these are not going to show up the

day after the president signs the bill.  So I think it's -- the answer

to your question:  People aren't going to see change immediately, but

if we pass a bill, it's going to be dramatic change down the road.

And I guess I feel mostly for the good.

 

     Jim Boyd?

 

     Mary Rae Bragg?

 

 

     QUESTION:  Senator, I wonder how you can go about assuring the

public that the changes in the health proposal that would make more

competition between drug providers and health providers will actually

work when we see -- well, for instance, the automobile -- or the oil

industry -- those companies get together and the prices stay high.

There's never -- we never see a trickle down to the consumer there.

 

     So why will it work in -- in the health care industry?

 

     GRASSLEY:  Well, in the pharmaceutical agreement that was made

over the weekend, the doughnut hole for seniors on Part D Medicare is

going to be almost totally filled as a result of that agreement.  So

you've got people that use more than $2,200 worth of drugs in a year,

between then and $5,100, they don't get any subsidy.  And then it

kicks in again at 95 percent subsidy when it becomes what we call

catastrophic.

 

     So there's about 12 percent of the people fall into the doughnut

hole.  Those 12 percent of the people are going to get subsidized

drugs through the doughnut hole, as an example.

 

     Other examples are going to be when you start doing things in

what we call coordinated care, you know, I spoke about 20 percent of

the people being readmitted to the hospital one month after they get

out.  We found, through Mayo Organization, through Kaiser Permanente

in Northern California, through Intermountain in Utah and some of

those other states, and through Geisinger Organization in

Pennsylvania, when they practice medicine in a coordinated care way,

it improves quality and actually saves money.  And there's studies

that show that.

 

     And Dartmouth will tell you in an annual report that they put out

on delivery of medicine in America that some of the -- some of the

poorest quality in medicine is delivered in counties that are the most

expensive in the United States, and Dade County stands out as -- as a

county that that's true, low quality, very high cost.  And it happens

that, maybe not this year but within the last couple years, Dubuque

stood out as a case where you get good quality and very cost

effective.

 

     Ed Tibbets?

 

     QUESTION:  Senator, I have a few questions about the co-op

concept.  And I just want to understand what your position is.

 

     Would you -- would you accept a national co-op which included

federal money to seed in planting some of the other elements I've seen

or a national board would oversee it, and it gives it bargaining power

over payment rate?

 

     GRASSLEY:  Well, yes and no.  The yes is that I accept the co-op

concept without a doubt because I'm familiar with it and I think it's

a very good concept.  And if it will enhance competition, the answer

is yes.

 

     If it's -- if it's loans to help them get started like we did the

REC cooperatives in the 1930s, I think that that's good.  Or

maybe even loans to get started from an operational standpoint and

maybe even the expenditure of some federal money to bring solvency to

them because you've got -- it's a chicken and egg thing.  You've got

to give some solvency to a new insurance company if you want it to

start up and be competitive.

 

     But not a national cooperative.

 

     QUESTION:  And why is that?

 

     GRASSLEY:  Well, if you have a national cooperative, it's not

really a cooperative.  You know, cooperative is neighbors getting

together to help each other out, only in the case of an insurance

cooperative for health insurance, you're going to have to have

probably 25,000 members to make it viable.

 

     So I would allow it -- I wouldn't want a mandate on it even on a

statewide basis because California is an awful big state.  But in some

parts of the country, it might have to be multi-state.  But it doesn't

have to be national, and it shouldn't be national because it's going

to run into the same political problems as the concept of a

government-run health insurance company.

 

     And what we're trying solve here is -- because I think I pointed

out to the first person -- Tony, I think -- or Jason that asked me

this question.  So go back to what you heard me -- him say.  But, you

know, I think it's a little ridiculous to think when you've got 1300

plans in America that there's not competition.  But if you need more

competition, get it through cooperatives.

 

     But our goal is accessibility and affordability.  So if everybody

that doesn't have insurance is going to be able to afford it through

government subsidy, you know, then what's the big deal about a public

option?

 

     QUESTION:  Critics of this co-op proposal have said that it won't

drive down prices like a public option.  Well, you know...

 

     GRASSLEY:  Well, let's go -- let's go back to what people are

trying to tell us about a public option.  They want it to look just

like an insurance company like -- like -- it would have to have the

same solvency requirements.  It would -- the federal government

wouldn't have risk.  So if it's just like Blue Cross, how is it going

to drive down prices any more than the competition between Blue Cross

and Etna?

     And I'm just quoting what people say that they want the public

option to be.  They don't want -- we raised the question of -- the

issue about the power of government to tax is the power to destroy,

and they said, well, we don't mean to do that.  We don't want the

government -- the government.  We want it to be just like any other

insurance company.

 

     QUESTION:  And you don't think that would accomplish their stated

goal then of driving down price?

 

     GRASSLEY:  Not if you do what they say they're willing to do.

 

     QUESTION:  OK.   Can you point to evidence that suggests that co-

ops have accomplished this public of driving down price?  Because

isn't -- I mean, isn't affordability one of the goals?

 

     GRASSLEY:  I only know about -- well, affordability, from this

standpoint, is going to come from two things.  One, community rating;

and the second one is from the subsidy for low-income people.

 

     But there's a couple cooperatives that -- I don't know much about

them -- but one in Rhode Island that's functioning and one in

Washington State that's functioning.  And I don't know whether it's

driven down prices or not, but we do believe, in America, that more

competition is -- is -- is what controls prices.

 

     And let's look at, you know, maybe -- I don't know where you were

in 2003 when you would have been on this program asking me questions

when I brought competition into Part D, everybody poo-poo'd it that

you wouldn't have competition.  And if you did, it would drive up the

price of prescription so many because the insurance companies are

going to make their money, and they don't care about the senior

citizens and all that junk.

 

     Well, if you go back to 2003, we were -- the Congressional Budget

Office was projecting this year that we would be spending $74 billion

on Part D drug.  We're spending $44 billion.  So competition has

worked.

 

     QUESTION:  Thank you.

 

     GRASSLEY:  Tim Rohwer?

 

     Christinia Crippes?

 

     QUESTION:  I'm good today.  Thank you.

 

     GRASSLEY:  OK.  I've gone through the list.  Anybody else want to

ask questions again?

 

     Before I say goodbye today, I want to thank Mary Rae for covering

Iowa politics and government.  She covered local city council meetings

all the way up to the presidents of the United States.

 

     And I've enjoyed very much hearing from you, Mary Rae, on this

program and the times you've interviewed me in Dubuque over the years.

So Mary Rae, enjoy your retirement, and I hope to see you when I still

come to Dubuque.

 

     QUESTION:  Senator, thank you very much.  I appreciate that.  And

I very much enjoyed our -- our association.  So, thank you.

 

     GRASSLEY:  We'll miss you on our weekly call, and I hope your

paper will have somebody substitute for you.

 

     QUESTION:  We've got someone ready to go, sir.  Thank you.

 

     GRASSLEY:  Goodbye.