Fox News Sunday December 29, 2013

GOTTLIEB: Well, clearly, there’s going to be dislocation. People are going to go and try to access health care and they’re not going to be insured. What the administration has said to the insurance companies is they effectively want the insurance companies to float people through the month, and if people think they’re insured, cover them through the month and administration said, well, reconcile with the insurance companies later. So, there’s going to be another reckoning February 1st. People will go January 1st and they’re not going to be insured. Some will be floated, and some will have that dislocation in February.

WALLACE: Governor Dean, how much confusion on January 1 when people who think they’ve signed up under the new system go to see a doctor?

DEAN: Probably less than we think. Look, this system is based on what Mitt Romney did in Massachusetts. It’s a private sector plan. It actually was designed by people of the Heritage Institute. And I think it will work. It wasn’t my favorite plan, but I think it will work.

But there are going to be dislocations. I think the reasons there are not going to be as many as most people think is because most of the people signed up are healthy. So, there’s not be a huge rush to the doctor on January 1st. But there are going to be problems. There’s no question about it and I think we’ll work through them. And I think by March this whole thing will be running a lot more smoothly.

WALLACE: You were shaking your head, Doctor.

GOTTLIEB: Yes. I mean, if you look at the demographic data, the underlying trends and who’s enrolling, there is that as evidence that’s less healthy. It’s a less healthy population and what he plans certainly hope for and probably older. You have to look at the state level data, because they’re not putting out national data from healthcare.gov.

So, when you look at the state level data, what you see is a lot of people are signing up for more expensive plans. They’re buying the gold and platinum plans, or they’re buying the silver plans, when everyone thought they’d be buying the cheaper bronze plans.

Now, the only reason you’d buy a more expensive plan is if you think you’re going to tap the health services, because effectively what you’re doing is you’re paying higher premiums to pay down your deductible and co-pays, and you’re only doing that if you think you’re going to use the health care. That’s an indication that this is a less healthy population.

WALLACE: I want to get to some of the —

(CROSSTALK)

DEAN: I think that’s true, but even, go ahead, but in general, not — most people don’t go to the doctor every single month. You have to be fairly unhealthy to have to do that.

And so — you know, Scott is not wrong about that, though. I think he is right at what he just said, the data does show that less healthy people are signing up, younger people are signing up less frequently than hoped.

WALLACE: I want to get to some of the specifics of what people are actually going to be — this is not going to be an enrollment issue anymore, it’s not going to be a Web site issue, it’s between you and your doctor and your doctor’s office when you want access to health care and whether or not that’s covered or not by insurance companies.

One of the president’s big promises, of course, was — if you like your doctor, you can keep your doctor.

Dr. Gottlieb, you say not only is that untrue, but in some of these plans, you may have trouble seeing any doctors.

GOTTLIEB: Well, there are very narrow network plans and they exclude a lot of specialist, people might have to travel far distances to see a specialist. We’ve looked at the networks. We’ve interrogated the plans and sometimes you have to travel 50 miles to see an urologist, for example. I found plans that don’t have a single dermatologist that does skin cancer surgery, for example.

But there’s also an issue with the drug formularies. These are what we called closed formularies, which means that the only thing that gets covered are the drugs that are on that list. And if you’re drug isn’t on that list, it’s not covered at all, and the out of pocket costs don’t count against your deductibles or your out of pocket maximums.

So, people are going to be very surprised. This is really a throwback to the old ’90s models of HMOs, when people really rejected those plans and preferred provider organization instead, which gave them more flexibility. People made that trade.

WALLACE: But you had an analysis where you said, I think it was in San Diego, that there was seven pediatricians in the entire county in the network, for the entire county of San Diego.

GOTTLIEB: Right. There was a plan in Florida, actually, had seven pediatricians for about a quarter million children in that county. But we found similar things in San Diego, we found it in New York as well, where plans only had seven or eight cardiologists, a handful of urologists that were 50, 60 miles away. It’s more on the specialty side. There’s not a lot of specialists in the lot of these plans.

WALLACE: Governor Dean, let me bring you into this. First of all, how troubled are you that the president’s big promises of 2012 and 2013, “if you like your plan, you can keep your plan, if you like your doctor, you can keep your doctor” turned out to be untrue? And specifically Dr. Gottlieb’s point, that you may have trouble especially you want to see a specialist, finding any doctor in some of these plans?

DEAN: Yes, that’s going to happen in a few plans. Remember, this is the insurance industry that’s running. And the insurance industry also squeezes cost by eliminating possibility of seeing people. A lot of these people that signed up are going to know that they limited themselves to closed networks and closed formularies because that’s what makes their plan cheaper.

But I do agree. And I actually don’t think for the most part that the Obama people get the blame for this. For example, in New Hampshire, they had a network that excluded a ton of hospitals. That was really the problem of the New Hampshire insurance commissioner. They have to pass on these plans being offered, so —

(CROSSTALK)

WALLACE: Governor, Governor, if I may, isn’t it the president’s promise if you like your doctor, you can keep your doctor? I mean, you’re now telling me in New Hampshire, that’s not true.

DEAN: For the most part it will be true, but it’s a little like the other promise, it won’t be true 100 percent of the time. That’s true.

GOTTLIEB: Well, the other — I mean, the other piece of this, is you can’t buy up to higher benefit. People think that if you buy in to a gold or platinum plan, you’re going to get a different network. You don’t. In most cases, the network of physicians is the same between the bronze, silver, and gold plans.

The only thing you’re doing is paying higher premiums to basically buy down your deductible. So there really isn’t a lot of choice —

(CROSSTALK)

GOTTLIEB: Please, Governor?

DEAN: Well, you do have a choice between insurance companies though. I mean, you know, you — there is no different goal —

GOTTLIEB: Yes, not in every state, 60 percent of counties in this country only have two insurers. But it’s true in large metropolitan areas, you will have a choice.

WALLACE: I want to get to this question of —

DEAN: That was true, Scott, though, before ObamaCare. Alabama, for example, essentially had one company that was doing 85 percent of the health insurance business.

WALLACE: Gentlemen, I want to get to this question of cause, because this was another one of the president’s promises. He said that generally speaking under ObamaCare, you will pay less for your health care than you did under the old season. Dr. Gottlieb, you said one of the problems is that folks maybe realized that premiums may be lower, although in a lot of cases it isn’t. But what they don’t realize is that under a lot of these plans their deductibles skyrocket, so that for months, you could be seeing a doctor and you’re not covered by your insurance because you haven’t met a $4,000 or $5,000 deductible.

GOTTLIEB: Well, these are expensive plans. Clearly, some people are going to do well. If you’re below about 250 percent to 200 percent under the federal poverty level, the subsidies are sufficient that you will probably end up getting a cheap plan, but anyone above that level could very likely end up paying more for the health care than what they were getting before. And remember, a lot of people going into these exchange right now aren’t uninsured folks. Most of the people are people who had insurance are now being forcibly moved into the exchange and most of the middle class folks really don’t benefit in the subsidies. They’re going to find these plans much more expensive than what they were getting before.

WALLACE: Yes, I want to talk to you about that.

DEAN: This is a very interesting —

(CROSSTALK)

WALLACE: Governor, let me just make the point —

DEAN: OK, go ahead. Sorry.

WALLACE: Because particularly, for people who aren’t going to get the subsidy or may not get a full subsidy, and especially those folks who bought into the bronze plans, you’ve got deductibles that are $5,000. You could have to go for your doctor for an entire year and not reach $5,000, particularly if you’re not that sick.

DEAN: Well, first of all, Scott is right, there will be a substantial number of people who are going to get subsidies, who didn’t have insurance before, who may have insurance and they’re going to save money. So, they will see lower premiums to them, they won’t cost less. But it will be lower premiums.

But here’s the interesting thing I find about the deductible argument. The deductible argument is such a classic Republican argument. This is what Republicans have always wanted, have more patience, put more skin in the game, and then they’ll be more careful about what they spend.

And now, we have those spectacles of Republicans attacking the higher deductible, just because they’re so desperate to attack this plan on any number. This is a Republican idea. Have higher deductibles, patients put more skin in the game with their own money and they’re more careful about how they’re spending their money.

GOTTLIEB: But these aren’t really high deductible plans. The idea of a high deductible plan is a lot of routine stuff that you pay for out of pocket, but you cover only catastrophic stuff. Here, what’s happening is a lot of routine stuff is paid for in full because of the mandates, where the deductibles and co-pays are going to hit you is on the more important stuff. I mean, you’ll get free surgical sterilization if you’re a woman, but you might not get cancer therapy paid for in all coverage on that.

And that’s the problem with these plans. They’re not truly high deductible plans in the traditional sense of how we think about them.

WALLACE: Let’s turn to another subject, because I want to cover as much of this as possible about what people are going to be facing. There’s been a lot of talk and we talked about it briefly here about who is signing up and the fact that it may be older, sicker people and that therefore, the insurance risk pool isn’t so good and that there maybe more costs to the insurance companies.

Dr. Gottlieb, under the risk corridor provision — risk corridor, it’s a term of art.

WALLACE: You can help explain what it means — of ObamaCare. What are the chances that the federal government may have to bail out some of these insurance companies this year or next year because they’re paying out more in premiums in — benefits than they’re getting in premiums?

GOTTLIEB: The cost is going to be higher than anticipated but the total cost probably won’t. Really what’s going to help offset the losses from the insurance companies is this reinsurance fund. It’s a $25 billion fund that’s basically paid for with a $50 to $70 tax on everyone who has private coverage. I’m not sure with union, they were exempted from it. That reinsurance fund is going to be use to offset some of the losses from the insurance companies, about two-thirds of the losses.

So the insurance companies really are going to take very big losses this year. Premiums will go up in 2015, as a result of the bad experience, but not as big as you think. The bigger issue is plans not getting into this market.

When I talk to actuaries who are preparing bids for 2015, the health plans, what they’re saying is the only plans they’re looking to get in are the Medicaid plans that didn’t get in this year.

Governor Dean, we’ve got a couple of minutes left. I want to take big picture with you.

Back in December, just before the launch of ObamaCare, you were quite critical of the critics of ObamaCare and you said this, “I think when they see what this looks like, this debate we’re having, which is outrageous, is going to look really stupid.”

Question, after all of the problems with Healthcare.gov, after the fact that it looked like a million or a million plus people are going to sign up by the end of the year, but almost six million are going to have lost their policies because of the cancellations, do you still think the critics of ObamaCare look, quote, “really stupid.”

DEAN: No. I think they look incredibly partisan, though. Scott is an exception to this. Scott and I debated before. He knows that facts. He knows what he’s talking about and I don’t think what he is saying is based on partisanship.

Most of the stuff that you see in the paper, if you see it in Congress, on the floor of the Senate and the House, their criticism, is hocus pocus and nonsense.

(CROSSTALK)

WALLACE: Wait. Forgive me, sir. But when it was the Web site, which was, I think everybody would agree, the president called it a disaster, when you’ve got 5 million people who thought they were going to be able to keep their plans, who were 6 million who got canceled — that’s not partisan, that’s just a fact.

DEAN: No. But, yes, but all of the hyperbole and socialist system and doctors are going to quit and all that stuff, it’s just not credible.

(CROSSTALK)

WALLACE: How about the part I asked you about, Governor?

DEAN: Are there some serious — I’m sorry, what’s that?

WALLACE: I say, how about the part I asked you about?

DEAN: Yes. The website was badly rolled out. Nobody would dispute that and it needs to be fixed.

I think the first year is going to be more successful than most people think. I think people will have insurance that didn’t have it before. I think you’re going to get people who have access and it’s going to be cheaper. Not for everybody.

I don’t think — we’re going to see — you know, Scott made a prediction here. I think he is partly right, but I think the numbers are going to be small enough so that the antis — the partisans are going to try to talk about all of these individuals who have gotten screwed by this. But most people, the vast majority of people are going to benefit from this. And that’s what I think is the important part.

WALLACE: Thirty seconds, Dr. Scott Gottlieb? Last word.

GOTTLIEB: Well, you know, the numbers they announced this morning were well behind. I was prepared to come on your show and say they must have been up to close to 2 million. They only announced 1.1 million. They were 900,000 December 22nd. So, we haven’t seen the rush that we thought we’d see for people to sign up at the end of the year.

WALLACE: And six months from now?

GOTTLIEB: You might not see. A lot of people coming in to these exchanges, again, are people who were insured and knocked off their insurance. The uninsured aren’t entering the exchanges because the plans are still expensive for them.

WALLACE: Governor Dean, Dr. Gottlieb, thank you both so much for coming in. We’ll be following how these things go in the first few weeks under ObamaCare. Thank you both, gentlemen.

GOTTLIEB: Thanks for having me.

DEAN: Thank you.

REP. MIKE ROGERS, R-MICH.: Thanks, Mr. Wallace.

REP. ADAM SCHIFF, D-CALIF.: Thanks so much.

WALLACE: Before we get to the NSA, “The New York Times” has an extensive investigation this morning into the Benghazi attack on its front page. It reports, quote, “No evidence that Al Qaeda or other international terrorist groups had any role in the assault.” It goes on, “And contrary to claims by some members of Congress, it was fueled in large part by anger at, yes, an American made video denigrating Islam.”

Congressman Rogers, I think it’s fair to say that “The Times” report directly contradicts what you’ve been saying.

ROGERS: Yes, I don’t know it was an exhaustive investigation. We have gone through some 4,000 different classified cables leading up to the event, talk to people on the ground during the event, done the postmortem on the event through the committee investigation.

WALLACE: What did they get wrong?

ROGERS: That al Qaeda was not involved. There was some level of preplanning, we know that. There was aspiration to conduct an attack by Al Qaeda and their affiliates in Libya. We know that.

The individuals on the ground talked about a planned tactical movement on the compound even — this is the compound before they went to the annex. All of that would directly contradict what the “New York Times” definitively says was an exhaustive investigation, tells me they didn’t talk to the people on the ground who were doing the fighting, the shooting and the intelligence gathering.

When you put that volume of information, I think it proves that story is just not accurate.

WALLACE: Well, let me ask you one specific thing. There was one group that everybody says was involved, Ansar al-Sharia. They say it’s really an independent radical Islamic group, but it doesn’t have links to Al Qaeda.

ROGERS: I dispute that, and I think the intelligence to a large volume disputes that al-Sharia.

Now, did they have differences of opinion with Al Qaeda core? Yes. Do they have affiliations with al Qaeda core? Definitely.

WALLACE: Do you think there is a political motivation to this “Times” report? Some people have suggested, well, this is trying to clear the deck for Hillary Clinton in 2016.

ROGERS: Yes. I don’t know, but I found it was interesting that there’s this rollout of stories, including Susan Rice, would go on TV and have a direct discussion, when we still have ongoing investigation in the House Intelligence Committee.

WALLACE: But, again, do you think that’s a different tactic?

ROGERS: I find the timing odd. I don’t want to speculate on why they might do it. But I can tell you that the information that’s being presented in a way that we’ve heard before and through the investigation have been able to determine is not accurate in its portrayal.

WALLACE: Congressman Schiff, does “The Times” report in your opinion exonerate the Obama administration from the president, to Susan Rice, to Hillary Clinton?

SCHIFF: Well, I don’t think “The New York Times” report is designed to exonerate the security lapses within the State Department that left our people vulnerable. I do think it adds some valuable insights. I agree with Mike that, however, the intelligence indicates that Al Qaeda was involved, but there were also plenty of people and militias that were unaffiliated with Al Qaeda that were involved.

I think the intelligence paints a portrait that some came to murder, some people came to destroy property, some merely came to loot, and some came in part motivated by those videos. So it is a complex picture. There was some planning, as Mike points out, but it was not extensive. I don’t think it’s either accurate to characterize this as a long-term preplanned core Al Qaeda operation or something completely unaffiliated.

And I think, Chris, where the New York Times report both adds value and also is deficient is they didn’t have the same access to people who were not aware that they were being listened to. They were heavily reliant, obviously, on people that they interviewed who had a reason to provide the story that they did.

Sometimes, though, the intelligence which has the advantage of hearing what people say when they don’t know they are being listened to, that could be misleading as well when people make claims, they boast of things that they were not involved in for various purposes.

So I think it adds some insights, but I don’t think it’s complete. And I don’t think either paradigm is really accurate here.

WALLACE: All right.

Let’s move to the NSA, because leaker Edward Snowden has been on something of a big public relations offensive this past week. He gave an interview to the Washington Post in which he said this, “for me, in terms of personal satisfaction, the mission is already accomplished. I already won. And he had a Christmas message, yes, a Christmas message for the people of Britain.”

(BEGIN VIDEO CLIP)

EDWARD SNOWDEN, NSA LEAKER: Together, we can find a better balance, end mass surveillance, and remind the government that if it really wants to know how we feel, asking is always cheaper than spying.

(END VIDEO CLIP)

WALLACE: Congressman Schiff, are you moved by the Edward Snowden Christmas message? And has he performed a public service as he seems to think?

SCHIFF: I’m not moved by the message at all. And I think there is a real irony here that he is giving this message from one of the foremost Big Brother states in the world where he is living without any privacy because there is no right or expectation of privacy in Russia whatsoever. So I’m not moved by this at all.

You know, he has kindled an important public debate, but frankly I think it came from a mixture of motivations on his part. And I think he should have stayed in the United States and been willing to stand up for his beliefs if that’s what motivated him. I think that would have demonstrated the courage of his convictions. So, I don’t find his message particularly moving or appealing.

WALLACE: Congressman Rogers, in The Washington Post interview, Snowden he asks and answers the question who elected him to reveal all of these government secrets. And his answer is that he says that it was the overseers of those programs let’s put up specifically what he says.

“Dianne Feinstein elected me when she asked softball questions in committee hearings,” he said. “Mike Rogers elected me when he kept these programs secret.” He says he is doing the job that you failed to do.

ROGERS: Yeah, well, you have to remember this is somebody who had a troubled employment history, who ran to China and Russia. He stole American classified documents that because of their release jeopardizes our troops in the field in places like Afghanistan and has allowed nation states, Russia, China and others to have valuable insight in the way our intelligence services operate to collect information to keep America safe.

That’s who the messenger is, number one.

Number two, the most recent court case, this happened just a few days ago by Judge Pauley, laid out very succinctly the oversight of the NSA program. And I think there’s a big confusion about that this is Obama’s program that he instituted when he was in office, this is a program that was initiated after 9/11, because we missed a big piece of information.

So both of the chairs of these committees, all of them members of these committees, are fully briefed on all of these actions. It is our job to make sure that they comport with the law. We do that. We take that very seriously.

I think all of that happened. And I think this most recent judicial ruling is important for one reason: it reinstituted faith in the institution of judicial oversight, congressional oversight and the checks and balances within the executive branch.

WALLACE: I want to talk to you about this, because you can — depending on your opinion, you can just wait for a judicial ruling and you can find some back and forth. Because let’s talk about the mass NSA collection, metadata collection, of billions of American phone records, who they called, and how long the call lasted, not the content. We want to emphasize that.

Now, in terms of rulings, in just 11 days we have one federal judge who called that practice of metadata collection almost Orwellian and likely unconstitutional. And then on Friday we had another federal judge call it lawful and the government’s counterpunch to Al Qaeda.

Congressman Schiff, do you agree with the congressional panel, because they came out with their 46 recommendations along with the two judges who say rather than have the government hold on these billions of records of metadata, that it would be better for a phone companies or some another private entity hold on to that information?

SCHIFF: Chris, I do. I strongly agree with that conclusion. And, you know, some have diminished the report by saying it’s just the work of a bunch of professors. We have to remember, you know, Mike Morell was the acting director of the CIA. Richard Clarke, long experienced in counterterrorism, transcending administrations of both parties.

Interesting that the two judges that you mentioned both appointed by presidents of different parties, and contrary to what people might expect, the Clinton appointee upheld the program, and the bush appointee said it was unconstitutional. I actually find confidence that in those rulings in the sense that those judges didn’t feel bound by the party of the presidents who appointed them…

WALLACE: Let me, if — congressman, if I can bring in Congressman Rogers, though, on the specific issue of who should hold on to these records, because there seems to be a general agreement that they need to be held on to by somebody. The haystack — real quickly.

SCHIFF: If I could just address that very quickly. The reason I think the program ought to be restructured is that we can get the same national security information that we need without the government obtaining millions and millions of records it doesn’t need to hold. The phone companies already hold these records for a period of time. We can go to them as necessary as the task force found. We can have an exigent circumstances exception where we can get those records immediately, otherwise we can go to the FISA court in advance.

So we can both protect the country and protect the expectation of privacy. And that’s the course that we ought to take. And that’s how we ought to restructure the program.

WALLACE: We’re running out of time, sir. So let me bring in Congressman Rogers, the interesting thing is since that recommendation came out, both the intel community and some privacy advocates say, we’re not crazy about the government holding it, but we think the idea of some private entity holding it would be even worse.

ROGERS: Yeah, it opens it up to privacy concerns across the board. And so there are — there is no such oversight.

And, again, the reason that Pauley decision was important, it went beyond — it looked at all of the oversight issues in ruling and in the judge’s opinion. Very important.

WALLACE: Another ruling that directly disagrees.

ROGERS: If you ruling, it wasn’t based — it was not a substantive ruling is why he staid his own ruling. He said this is probably going to get overturned — why? 15 judges, 36 rulings, all of them upheld that this program is lawful and meets the Fourth Amendment test.

And then you have hundreds of appellate decisions over — since Maryland v. Smith that uphold the underpinnings that these are business records, non-content, no names, no addresses. That, I think, is an important distinction.

So, I think the foundation of the legal argument is there. And what we have here is you’re going to take away the safety of what is well overseen, locked away in a vault, very, very strict oversight on who gets access to even check a foreign number coming into the United States.

And this is what’s important, after 9/11, we missed a foreign call coming into the United States. They said how do we fix that? This is the way they decided to fix it. And you have all the levels of oversight to make sure it’s safe.

It goes to the private companies, you are going to have a government mandated scheme, no such oversight the way we have it at the federal government.

WALLACE: Well, this is going to be continued, as we should point out, the president on his Hawaiian vacation is studying I’m sure the court decisions, the varying court decisions as well as his independent panel’s rulings — or recommendations. And he is going to come out in January with a new set of guidelines.

Congressman Rogers, Congress Schiff, thank you both so much for joining us. And we’ll stay on top of this surveillance debate. Thank you, gentleman.