TRANSCRIPT: 'Questions for the President: Prescription for America'

JOHN SHEILS, THE LEWIN GROUP: Well, we looked at several different

options. You could design it in several different ways. There was a

particular scenario that people looked at, and that's what got all the

attention. It's one where the premiums would be -- for a family, for

example, would be as much as $2,500 a year less than in the private market.

The reason for it is that they paid under -- under -- they used the

Medicare payment reimbursement methodology, and they paid physicians a

lot less, hospitals a lot less. So the premium came out as much as

$2,500 a family lower in that particular scenario.

That's pretty attractive. We estimate that 70 percent of anybody with

private insurance would -- would make the shift to the public plan.

GIBSON: Which would be millions of people going over to public

insurance. You keep saying, if you have what you like, you can keep it,

but if your employer goes over to the government program, maybe you

can't keep what you have.

OBAMA: First of all, I think it's important to understand -- and I think

the Lewin Group acknowledges this -- that there are a whole series of

ways that we could design this. One of the things that we've said is

that, if you are eligible for your employer plan, then you can't just go

into the public plan, you can't decide that you're already having a

pretty good deal in insurance, and you're just going to dump that,

what's called a firewall.

The other thing we're doing is we're saying to employers, to provide

them a disincentive for just dumping people out of existing plans, is

there's going to be a pay-or-play provision. If you're not providing

health insurance to your employees and you're a large employer, you're

going to have to kick in a certain amount of money because it's not fair

for taxpayers to have to cover your employees, whether it's through a

public plan or through uncompensated care -- essentially sending people

to the emergency room -- which, by the way, adds to all of our premiums

collectively about $1,000 bucks a year.

So we would have -- I think there are some legitimate questions in terms

of how the public option is designed. One thing I have to say, though,

is, it's not an entirely bad thing if, as long as they're reimbursing

doctors in an adequate way, and -- and -- and so not being oppressive on

-- on health care providers, and as long as there are not a whole bunch

of taxpayer subsidies going into a public plan, if the public plan can

do it cheaper and provides good quality care, that's the competition

that we talked about.

I don't think you're going to get a lot of complaints from people if the

deal is a better deal. If it's not a better deal, then people aren't

going to choose it. And -- but what we think is, is that we can set up a

system in which you are expanding choices for individuals as opposed to

constricting them.

GIBSON: All right. We'll take a commercial break. "Nightline" will

continue. Stay with us, more questions for the president.

(COMMERCIAL BREAK)

GIBSON: And we're back. Our special edition of "Nightline" continues.

Mr. President, on this issue of costs, of this entire thing, a lot of

people are concerned that it's going to be so expensive, their taxes are

going to go up. And we have a question on that very subject. Is David

Hattenfield here?

David, where you are? Stand up.

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