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dime on the dollar more on paperwork, regulation, and insurance premiums 
than anybody else?'' That is waste. Why take something away from hard-
working people before you squeeze the system and its unconscionable 
burdens on hospitals, doctors, nurses, and the American people 
themselves? That is where we ought to start.
    I also want to talk a little bit about the guarantee of private 
insurance. Most people, under our approach, would get insurance the same 
way they do today, through their employer. Each consumer, not an 
employer, not a bureaucrat, would have a choice of health care plans and 
doctors.
    Let me point out something else on this choice. Today, 55 percent of 
the companies who insure their employees and 40 percent of the total 
work force insured through their employer have no choice today in 
doctors or health plans. They take the plan the employer has chosen. 
Under our plan, everybody would have at least three choices of plans, 
including the right to simply pick a doctor and have fee-for-service 
medicine. That is more choice than exists today, not less. Again, the 
rhetoric of people who have attacked change defies the reality of what 
people face and deal with in their daily lives in the health care system 
today.
    Once someone has picked a plan, if they need to go to a doctor for a 
checkup or if they get sick, they'll simply take a health care security 
card, show it, and get the care they need. Then they'll fill out one 
standard form, and they're done. That way, we can go back to seeing 
hospitals as places of healing, not monuments to paperwork and 
bureaucracy.
    I have heard so many stories in so many hospitals, I could keep you 
here all day laughing, but it would be like preaching to the saved. The 
only thing I want you to do is to go tell the Congress about it and that 
we can do better.
    Last week when I spoke to Congress, I said that I would veto any 
legislation that did not cover every American with guaranteed insurance. 
Now, again I want to say that I did that because you know that unless we 
do that we can't have everybody playing by the same rules, using the 
same forms, ending the cost shifting, and getting people the preventive 
and primary care they need so they don't simply wind up in the emergency 
room. That is, all the systematic problems that the Hospital Association 
brought to the administration when we began this discussion will 
continue unless we provide coverage to everyone.
    Now again, I know there are issues to work out. There are 
differences about what level of Medicaid savings can be achieved. I'll 
tell you this: Our plan is the only one that takes the Medicare savings 
and puts it back into the health care system, which is very, very 
important. But the biggest thing you need to do, I would argue, to get a 
good health care bill out of Congress is make sure that the people in 
the Congress understand how the system works today and what these 
various approaches would do if they were passed.
    Yesterday, Families USA issued a very valuable document which I just 
received a copy of this morning which takes 10 different families, 10 
different health situations, and goes through in practical terms how 
they would be affected if each of the major plans now pending in the 
Congress were the law of the

[[Page 180]]

land. I would urge you to read it. But it won't surprise any of you 
because you know how the system works today.
    Again, I implore you to take this debate to Congress, get beyond the 
rhetoric, get beyond the ideology, talk to people in the Congress about 
the American people and how the American health care system affects 
them. That is the only way we can work through the real problems as 
opposed to the imagined one.
    One distinguished Member of the House of Representatives who 
represents a district with a wonderful teaching hospital and who has 
been required by virtue of his membership--his constituency--to become 
an expert on health policy over the years, read our plan the other day, 
and he said, ``It's the only one that really takes account of so many 
different problems that most people don't even know about. But I have no 
idea how to get my colleagues in the Congress to take this issue 
seriously and spend all the time it would take to absorb it all.''
    You can do that. Every Member of Congress has a lot of hospitals in 
his or her district. Every Member of Congress basically cares a lot 
about health care. And you can come to this debate with a perspective 
that is not ideological, not partisan, has no ax to grind, doesn't care 
who wins except the American people and the American health care system. 
That's what you can bring to this debate.
    So I would ask you, at a time when some say we just need a little 
tinkering and others say there are ideological barriers to changing it, 
I just want to say that Dick Davidson, your president, in my view, said 
it as well as it could be said last December. He said, ``Comprehensive 
reform is what the American people are asking us to do. To do nothing, 
or worse, to fall back on simplistic solutions, only postpones and 
complicates our task.'' And that's the truth.
    Let us stand together for the health care of the American people. We 
have a chance finally for the first time in decades to do this right. 
You know what needs to be done. I pledge to you an open door, a 
listening ear, a firm partnership. Let's go out there and solve this 
problem for the American people.
    Thank you very much, and God bless you.

Note: The President spoke at 10:18 a.m. at the Washington Hilton. In his 
remarks, he referred to Dick Davidson, president, American Hospital 
Association, and Carolyn Roberts, chairman-elect, American Hospital 
Association Board of Trustees.


<DOC>
[Weekly Compilation of Presidential Documents]
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[Page 180-186]
 
Monday, February 7, 1994
 
Volume 30--Number 5
Pages 167-215
 
Week Ending Friday, February 4, 1994
 
Remarks to the National Governors' Association

February 1, 1994

    Thank you very much. If anyone ever asks you what do Carroll 
Campbell and Bill Clinton have in common, you could say they have the 
same throat disease. [Laughter] He's doing better today than he was 
yesterday. I'm doing slightly worse. The good news is, you get a shorter 
speech.
    I want to thank you all for being here and for your common concerns. 
Yesterday we had a good meeting and especially, I thought, a very good 
discussion about the problem of crime in our country and the crime bill, 
the necessity to put more well-trained police officers on our streets 
and to take repeat violent criminals off the streets forever but also 
the necessity to be smart about the crime bill, to do things that make 
sense to you and to your law enforcement officials.
    Today, I want to talk a little bit about two other fundamental 
challenges that we face: health care reform and welfare reform. They are 
linked inextricably to each other. And in order to meet these 
challenges, we will have to have an open and honest partnership both in 
passing the laws and, perhaps even more important, in implementing them.
    We began our partnership, at least with me in this new job, about a 
year ago today when we had a very long and fruitful meeting at the White 
House. I think it ran in excess of 3 hours. That meeting resulted, among 
other things, in the approval of every major waiver for State health 
care reform that you have requested. There have been 5 of them and about 
90 smaller waivers to enable different changes to be made at the State 
level. In addition to that, we've now granted waivers to nine States in 
the area of welfare reform.
    I do believe the States are the laboratories of democracy. I do 
believe that where people are charged with solving the real problems of 
real people, reality and truth in politics

[[Page 181]]

often is more likely to give way to making progress.
    Last August you all said, Democrats and Republicans alike, that our 
health care system is in crisis. In the last several days we've had a 
big linguistic battle in Washington about whether we have a crisis or a 
serious problem. I think it's better, since we're at the Governors' 
meeting, to focus on the facts. We do have a system, unlike any other in 
the advanced countries in the world, in which insurance companies decide 
who's covered and who isn't, what the cost of insurance is, and what's 
covered in specific policies. We do have a system in which the number of 
uninsured people is going up significantly. We do have a system in which 
more and more Americans, therefore, who have insurance are at risk of 
losing it if they get sick or if their job goes away.
    We clearly have a system, as our SBA Director Erskine Bowles, from 
North Carolina, never tires of telling me, where small businesses have 
premiums that, on average, are 35 percent higher than large businesses 
or Government. We have a system in which State budgets have been 
extraordinarily burdened by the exploding costs of their Medicaid match, 
so that last year, for the first time ever, States spent more money on 
health care than on State-funded higher education.
    We have a system in which the lowest estimate of uncompensated care 
burdens on hospitals is $25 billion a year; in which 58 million 
Americans, according to the Medical Association, are without coverage at 
some time during the year; in which 81 million Americans have a 
preexisting condition, which means either that their premiums are higher 
or that they can't get insurance or that they can't ever change jobs, 
which is an enormous burden in a system in which labor mobility is, I am 
convinced, the key to personal and family prosperity as we move toward 
the 21st century.
    Finally, we have a system in which three out of four insurance 
policies have lifetime limits, which means if you get really sick you 
might run out of insurance in the middle of the time when you need it 
most.
    Now, those are facts. They can be seen in the million letters, 
almost, that the First Lady has received since we started this whole 
effort to deal with health care. On the way in, I was describing briefly 
to Governor Campbell a letter I got from--or she got from Jo Anne Osteen 
of Sumter, South Carolina, who owns a small business, works 6 days a 
week, raised three children by herself with diabetes and arthritis. 
Although she had diabetes and arthritis, when she wrote us she hadn't 
been in the hospital one time in the 12 years that she'd been with her 
insurers. But her insurance rates went up to $306 a month, even though 
she was only taking home $205 a week from her business. Her doctors told 
her that the answer was to quit and go on disability. So she wrote, 
``Those high premiums are going to force people like me to the welfare 
and food stamp lines with no insurance. I am a proud American, and I 
don't want this to happen to me. I have thought about nothing but this 
problem, and I don't know where to turn.''
    Well, I think we ought to heed her call for help. A lot of you do, 
too, and that's why you've tried to reform your health care systems. 
After all, this woman has values that keep this country together. 
They're the ones that built our Nation. And we shouldn't force people 
like that to consider seriously whether they should go on to public 
assistance in order to take care of their children.
    There's a flip side to this, too, this connection between welfare 
and health care, which I want to mention. I talked about it a little in 
the State of the Union Address. But we often say to people they should 
leave welfare and go to work. And we know that welfare benefits 
themselves in real dollar terms are lower today than they were 20 years 
ago in most States. So that the welfare check has almost nothing to do 
with why people stay on welfare. They stay because of the medical care 
and because of child care and because they have low skills. But we have 
this incredible situation in our country where if someone on welfare 
leaves welfare to take an entry-level job that doesn't have health 
insurance, as soon as the coverage of the Family Support Act runs out, 
you have people making low wages paying taxes to pay for health care for 
people who stayed on welfare and didn't make the same decision they did.
    So these two issues are clearly tied together, and we need to see 
them together

[[Page 182]]

as a part of what it would take to make America a place where people who 
work hard, play by the rules, and believe in the kind of values that 
permeate the efforts that all the Governors around this table are making 
are rewarded for that.
    Now, we've made a beginning. Last year, the Congress passed in the 
context of the budget act a huge increase in the earned-income tax 
credit which lifts families with children on modest wages out of 
poverty. When tax bills come due this April, 15 million families with a 
total of about, we estimate, 50 million Americans, will be lifted beyond 
the poverty line by getting tax reduction under the earned-income tax 
credit. That means that there will no longer be an income incentive for 
people to choose welfare over work.
    But the welfare system has a lot of other problems as well. Too 
often it still rewards values other than family and personal 
responsibility. Instead of encouraging those to stay together as we 
should, it often encourages families to break apart. Instead of 
encouraging children who have children to live with their parents or 
grandparents, it often encourages them to leave home. Instead of 
enforcing child support and asking those who bring children into the 
world to take responsibility for them, it too often ignores--it's too 
difficult to collect the $34 billion absent parents should be paying to 
their children.
    Perhaps most important--we were talking about this on the way in--an 
enormous part of this problem is the explosion of births to people who 
have never been married at all. And there is nothing in the present 
system, except where the States have taken the initiative to do it, to 
stop teen pregnancy from occurring in the first place. Even in the 
Family Support Act of '88, and I want to say more about that because I'm 
really proud of what we did on it, there was nothing to stop the 
condition from occurring in the first place.
    And we need to devote, as this debate takes place, an enormous 
amount of attention to some of the decisions that we ought to make, some 
of them quite politically courageous. Governor Campbell was talking 
about some of the things they're doing in South Carolina which mirror 
some of the things we tried to do at home to try to stop these things 
from occurring in the first place.
    This year I have committed, and Senator Moynihan, I think, and 
Senator Dole probably both talked about this--to offer in the springtime 
a comprehensive welfare reform bill to restore these values of 
responsibility and family. We want to help those who are on welfare to 
get on their feet. We want to help them for up to 2 years with training 
and child care and other supports. But after that, we need to have a 
system that says anybody who can work and support themselves and their 
families must do so, in the private sector where possible, with a 
community service job if that's the only work available, to make welfare 
a second chance, not a way of life.
    Now, those of us in this room have worked on this issue for years. I 
was privileged, along with the then-Governor of Delaware, Mike Castle, 
to be the representatives of the Governors who work with Senator 
Moynihan and with Congressman Ford and others on the welfare reform 
effort that became the Family Support Act of 1988. Mike Castle is now in 
the Congress, having changed jobs with Tom Carpenter. Guess who thinks 
he got the better deal out of that?
    We never fully implemented that act. You know it, and I know it. So 
we ought to begin asking ourselves: Did we do a good job then? What 
progress has been made in the States? There's a lot of evidence that 
significant progress has been made in the States that have been most 
aggressive.
    Why was it never fully implemented? Partly because Congress never 
fully funded it, partly because--as you will never hear the end of it, 
they'll say, ``Well, but the States never fully used all the money we 
came up with. States must not have really cared about this because they 
never provided the State match to use all the funds.'' You know why the 
States never provided the State match, don't you? You had to spend all 
your money making the Medicaid match, which was not optional, it was 
mandatory, and building prison cells. That's where we spent all of our 
new money in the 1980's and the early nineties.
    So I point this out not to do any finger-pointing but just to say 
one of the things we need to do is to go back and look at that

[[Page 183]]

bill, see what's good about it, figure out what will be necessary to 
change so that the States can take full advantage of that bill, because 
it had incentives to work, it had supports for families. It was never 
fully implemented because you had to spend all your money on mandatory 
explosions and medical costs and building prison cells, many of which 
were also mandated by the Federal courts, not the Congress. So we need 
to begin there.
    We also need to know that--to recognize again--though I will say 
that we estimate that about one in five, just under one in five people 
who get back on welfare after they get off do so for a health-related 
reason. Because so many people on welfare, virtually everyone has 
younger children, the loss of the health care coverage for the younger 

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