Satellite provider. The nations governors are in washington, d. C. , this week for their annual winter meeting. Discussingnors are efforts by republicans to repeal injury place the Affordable Care act. This is one hour. My name is sarah. I am a senior policy correspondent. I have been covering the healthcare care debate for about seven years and it appears i will be covering it for many more years. Ofm a journalist with plenty job security. We are here to talk to a few healthgovernors about Care Solutions at a moment when there is a lot of potential for change. What they saw, what they think about situations. Ofill do a brief round introductions and let them introduce themselves in opening remarks they are prepared. Me is the former governor of vermont. Next to him, former governor of South Carolina. Former governor of nebraska and all that web my left, haley barker, former governor of mississippi. Thank you for coming to join us here. I will start right here. If you want to kick off with a few opening remarks. I will be happy to. Of course, haley is on your right. 20032000 11. 2006, we passed a Significant Health care measure in vermont. I can go into details of you want. And extended coverage, focus on preventive care. The next year week reduced our uninsured rate by about 25 . In 2009, i assumed the chairmanship of the National Governors association and had to , i wont offer any qualitative adjectives, of chairing the organization during the aca debate. That was a challenging time for everybody as i am sure you know message, thee, our associations in congress was the same one that and jay offers today. I saw the letter that and ga just sent to house leadership within the last month and that is for small, listen to governors. Secondly, do not open and impose any Unfunded Mandates on the states and give flexibility to Design Health care programs that work for respective states. Good10, we were having conversations but as everyone knows in the end, it was run through on a partyline vote and the rest, as a say is history. I hope we all learned from that expense. In vermont, every by pollution. In vermont, i am republican. But we worked together to find a way to make something we are all proud of even a decade later. I hope in washington they were will find a way to find Common Ground for respective states. I served from 19 92003. A long time and ga along. The spin on health care for state governments was under 10 . The amount we spent on state budgets. Im guessing now it is one third or more than one third on health care that we spent. I think that is problematic. We need to fix the Health Care Problem because Health Care Spending is crowding out investments and infrastructure and education. If we do not fix it in some way, the states will not have the funding to educate our next generation. We had this discussion about Early Childhood. What we are spending is not much less. I think that shows the highstakes that exist here. And puts it in the order it needs to be. That is a huge issue. One quick comment about health care. I really think, and it is touching on what jim said. A couple things are important. Gives flexibility to states the flexibility they need to enact programs. There are a lot of federal rules that have existed a long time that i think need to be adjusted to enable states to better run programs. The second piece is stakeholder engagement. You mentioned the governors. Critically important. Governors need to have a seat at the table. I would add Health Insurers and Health Care Providers need to be a part of this. A final comment. We talked about the aca the four. There are 20 million more people that of gotten health care or shape. N some way there are about 160 million more that have insurance through traditional medicare, medicaid, private Insurance Programs. Whenever the president proposes, they have to make sure they do not screw things up for those 160 million. That is my big worry. Some of these reform packages will make things worse because they do not engage the stakeholders adequately to get the kind of fix that will help us. Ofcks i served as governor nebraska from 19911999. Governor ofed as nebraska from 19911999. That was enough for me so i started serving in the senate. I have seen the Affordable Care act up close and personal. Ive also seen it with the needs for having coverage available for people across the country. Sometimes as medicaid. Sometimes as medicare. Sometimes private care. Five it pay. Issue that has been around for a long time. An issue that bedevils people trying to exit. Fix it. Ng two so knowing i was coming here today, i went back and looked at all of my votes in 2009 and 2010 to refresh my memory on the various things we were dealing with. It probably will not surprise you that it sounds an awful lot today likened it back then. It is no longer apparently, according to my good friend john boehner, an easy decision to make about replacing. , or repealing. One of the things they governors i think have to Pay Attention to is the interest in block grants. That is an oxymoron, fully funded. I almost could say they will be. So the governors have to be quite careful that they do not end up with the shift of responsibility, because if they get that shift of responsibility without adequate lending it will be the shaft. They really have to be a alert and asking the right questions and seeking the right answers from folks here with this administration and members of congress. There is no easy solution to a problem of this magnitude. Going to come in easily. They are going to have to work hopefully in a bipartisan way. That is always the hope. But whatever they do, they have to be sure they do not make a worse in the process of trying to make it better. I hope it does not surprise you that the fact that jim is a republican from vermont and these two are both democrats, i believe in everything they said. First of all, Health Care Reform is hard. Health care reform is hard. It took the democrat secured have to pass the Affordable Care act. And were going to replace, repair, redundant, whatever. [laughter] that were going to replace obamacare in a matter of weeks just ignores the faculties. You could repeal of obamacare fast. You cannot replace it fast successfully. This is complicated stuff. In, i think there are a lot of members who want to understand it. I hope they understand 80 of the people who got Health Insurance who did not got Health Care Coverage to did not previously have it, got it from medicaid. 16 million of the 20 million was medicaid. Interestingly in a state like mine, was not just an states that expanded. Expand in mynot roles increased 20 . 70,000 more people because of what they call here in this time a woodwork event. So, complicated, enormously. Xpensive, patience is required i am one of those that believes we do need to repeal and to replace this but i think we need transition that does what a couple of my colleagues mention. Make sure we have stability. That the Insurance Market does not collapse out of fearfulness and the lack of stability. That deep Provider Community believes in what is going to happen and then that the patients believe in what is going to happen. Now, we will see how long it takes. I make is because 80 of the people who did not have Health Care Coverage that now have a got up through medicaid, governors know about 50 times more about medicaid than most. Proclaims governors actually run the business. It is a complicated business and the idea that it is the same in nebraska as it is in mississippi is silly. As much as we are like South Carolina, we have different issues and different problems and different solutions. Intojim has made the point his state is not the only state, there have been some major innovations that have really wholeff and that is the idea of the laboratories of democracy that we subscribe to as states. Let the states have more flexibility. Lets dont believe that overnight that that can produce gigantic savings. You know, lastly, leslie for the second time [laughter] the republicans should not force the people who did not expand medicaid to be punished for not expanding nor the people who expanded medicaid to be rewarded for expanding. Whatever system they work out on the financial side has got to be equitable to those who expanded and those that did not. And to do that while keeping the tax papers from getting the shaft is not easy. It takes a lot of work. Great. Thank you all. I want to put two questions, specific questions. I want to say senator nelson, governor and senator you had these remarks that john boehner made that he does not want republicans to replace and repeal their Affordable Care act. He said republicans could never agree on health care. Where you are a lot. In one minute or two minutes, answer. Are you expecting repeal and replace at this point . What are your expectations for what are we are in for for the next year or two. Theou can already sense frustration. They want to keep all the good things that are expensive but they do not know what they can get rid of to save any money and not have it be something that is one of the effects that are so repair. Part of the you know, if youre going to add people, allow people to stay on their parents plans until they are 26yearsold, that is expensive. You know, the ones out there working who have jobs and so forth and qualify, if you change it, will take their own coverage elsewhere. But in many instances, the young people who stay on their parents plan is because are not working. That in many instances because it is cheaper for them to stand the plan then to get some substandard plan from a risk pool plan or Something Like that. It then to say were going to knock then to say were going to knock exclusion, that is expensive as well. The whole system of taking all covers, its problematic to find and control the costs. Remember, when this whole process started, and it was still bipartisan until summer of , they were working in the finance committee, in the health , passing amendments, accepting amendments to the bills. They were working their way through in the senate i dont know about the house, but they were doing that. Then something changed. They went home and had what they are experiencing today, maybe in reverse. What are they called town halls. Raucous town halls. With that, what you had was no longer emphasis on trying a way to bend the cost curve to try to make it less expensive to have care, so that you had quality of care, less quantity of care, less costly care wherever possible. That got shoved to the side, and it became about universal access. When you have universal access and do not have a way to control the cost, do not be surprised if numbers go through the roof. Youre going to have people that are going to bring very expensive conditions to the table. They are going to be covered, and thats going to be shared by everybody else. I do believe that governors should have a strong say in dealing with this. Maybe they least, cannot handle the universal access issue and the preexisting condition, but maybe they can work internally within their own states to try to find ways to reduce the excessive costs that are there. I trust them to do that. I think thats what happened when i was governor and we had welfare reform. We got all kinds of programs going to get people out of welfare and in the workforce, from welfare to work. We transitioned them with until they took a job and were qualified under their employers plan. I trust the governors and states to do an awful lot of bending the cost curve by finding better ways to control those costs locally. When i heard Speaker Boehner s comments, i thought that he it isht in the sense that so difficult to retreat from an entitlement that has been granted by government at any level, but at some point, folks in congress have to remember where we are. Our federal debt is inching up toward 20 trillion. A lot of states not all, but a lot of states are struggling to balance their budget. We are in recovery from recession, but a lot of states are still struggling, so we have to find ways to ratchet down those costs. I think there are a lot of options between the status quo and block grants. In 2005, we had a lot of options on medicaid. I went to our former colleague, the secretary of health and human services, and said, have i got a deal for you. Im going to accept less medicaid money than vermont would otherwise be entitled to over a fiveyear period in exchange for more flexibility pea. After he looked over it with his , and we savedreed a lot of money. My point is states can find creative ways to run their programs if you have the flexibility that is necessary. I think we should let governors be creative. Do you think republicans can . T replace and repeal [inaudible] in the year, we ought to replace it. It will not be easy. Replacement isis much, much more complicated. [inaudible] federal guidelines, federal framework, and that gives the states what they need to design within that context and allow states to make a lot of the decisions. We are having a little bit of trouble with our microphones. I think we are all quite loud, though. I think it is foolish to say everything has got to be done within a few weeks. This is going to take more time than that. I hope by the end of next year, better laws, they will have repealed and replaced, and we will have state implementation of the framework. [inaudible] obamacare was past six years ago, and a lot of it still has not gone into effect. [inaudible] this sounds like a project for a good, long study committee. We are good at that in federal government. He feds can do that but there are some things that need to be fixed. We need functioning Insurance Markets. Talk about the aca before we get into medicaid, there are issues that need to be addressed. There are some things that need to occur that could not occur because republicans wanted to repeal it and democrats were scared to reopen the process, so lets look at the quick fixes that can occur and try to take care of those that we think will create effective, functioning competition in the Insurance Market. I think everyone agrees we need a more meaningful mandate. We have to do something about the subsidies to try to get younger people into the Health Insurance market. Finally, theres a handful of things we can agree on moving forward and then look at the larger problem. My own feeling is they may name it something else, but they are not going to make dramatic changes from the Affordable Care act now. A couple of states have set theres this mandate in the federal law that requires all eligibility for medicaid and chip to be handled by classified state employees. Theyve said they could save millions if they get outsourced that simple process. There are a lot of things like that embedded in the Affordable Care act that i think could get us toward a battle fisk of better fiscal position than we are at now. One of the things that i would add is unless you find a way to get everybody into the , it is going to be less than whole. Thats obvious. And when it is less than whole, you will have more sick people and the less sick people and more well people perhaps outside. The penalty, which i guess was a Heritage Foundation idea, to put the penalty on because if people have to pay a penalty, they would rather have insurance. Could not get the penalty high enough politically what it really created an effect, so you had a lot of the young s who do not want to pay for the Government Program and would rather pay the penalty. Its a foolish tradeoff, but thats what people did. They will have to find a way toernally within the states get everybody insured one way or the other, or they will continue to have glitches on pricing, raging, and what have you. Rating, and what have you. We brought up the idea of block grants. Theres an idea of a per capita around. Edicaid going i know thats an idea a lot your republican colleagues on the hill really like. What do you think it means as a governor . What do you think it would mean in your state if you were to have block Grant Funding where you would get more flexibility but your funding would be at a cap level . My second term as governor, i houseied before the committee with jurisdiction over medicaid and said give me a block grant for medicaid and i will take 2 less. In fairness, you get an addition i said and i sent take 2 off of what i would otherwise get and we would come out ahead. Jim douglas figured out a way to do that. Theres a lot in some peoples. Inds with block grant caps seem to be getting a lot better reception than block grants. I think a critically important element for governors and whatever it is, a per capita cap or a block read, but you have essentially for big silos of medicare spending per capita , but you haverant essentially 4 big silos of medicare spending. 16 of medicaid spending was for healthy adults. That was 61 billion for healthy adults, and governors want to not be put in a position where they have to continue to spend 16 of medicaid on healthy adults, so let them be able to take care of the people who need first. S worst the aging and the blind and disabled. About 50 of spending in most states of medicaid goes into those categories. Do not hold them to 50 if they need because of the growth of the senior population to have more money. Let them cut down the amount of adults. R healthy make them work. Have a work requirement like yall did welfare reform. Theres several ways to do that fairly. 80 of the people who got Health Care Coverage under obamacare got it by being put on medicaid, but now, they are 1 the six of medicaid spending. As our older population goes up and up, and lets face it, the blind and di