THE WHITE HOUSE

                    Office of the Press Secretary

______________________________________________________________
For Immediate Release                             August 8, 1994


               PRESS BRIEFING ON UNIVERSAL HEALTH CARE

                          The Briefing Room




11:04 A.M. EDT


             SECRETARY SHALALA:  I'm Donna Shalala, Secretary of HHS,
and I'm here this morning to continue the effort of myself and my
colleagues in the Cabinet to do a full court press for health care
reform.  This is a very historic week for every American.  Beginning
tomorrow, both Houses of Congress will begin a debate on
comprehensive health care reform.

             In the 19 months since this debate started, we've made
dramatic progress in our effort to guarantee a lifetime of health
security for every American.  We have one more roadblock in our way.
Opponents of real reform are arguing for another delay as they throw
together incremental, halfway proposals that aren't even drafted yet.
Opponents of real reform would also have us believe that our goals
can be met with incremental piecemeal changes; they cannot.  They
think that tinkering around the edges is enough for now, it is
not -- that approach will not work.  It will cost more and it will
leave millions of hard-working Americans at risk.

             The President and the members of his Cabinet are
enthusiastic and are very determined that this process will end in a
victory for the American people.  It will end in legislation that,
for the first time in this country, provides every American with the
rock-solid guarantee of health insurance that can never be taken away
-- private health insurance that can never be taken away.

             But this is not a victory that can be taken for granted.
From now until the legislation is passed, each of us will spend the
majority of our time fighting for health care reform.  This is not a
fight for a political victory, and it certainly is not a fight for a
partisan victory; it's a fight for the health of every American.

             The data we're releasing today shows just how urgent
this issue is.  For those of you from the "Jenny Craig School of
Government," including my good friend, now, Senator Gramm, I should
tell you that the report weighs 45 pounds.  I actually am 10 pounds
lighter since we started the debate.

             The report actually is that heavy because it contains
information about every community in this nation.  It shows how many
people in each community are living without health insurance today.
It breaks down the data into those who are working, or the dependents
of a worker.  And it shows how many children are uninsured.

             What these reports illustrate, state by state, is the
economic and human cost of the current health care system.  It shows
the danger we face if we follow the advice of some in Congress to do
nothing, or to enact some form of halfway solutions.  Let me just
give you one example.

             In the State of New Jersey, nearly one million people
are without health insurance, and in that state, 45,000 people are
losing coverage every month.  A million people without health
insurance, and 45,000 that lose their health insurance every month.
Clearly, the working people of New Jersey and their families can't
afford to wait another year.  Eighty-three percent of the people in
New Jersey who have no health insurance are working, and that
includes them and their families.

             That's a 56 percent increase since 1988.  So we're not
only talking about a million people without health insurance --45,000
people in New Jersey who are losing it every month -- but of those
who don't have health insurance in New Jersey, over 80 percent of
them are working people and their families.

             That's a 56 percent increase since 1988.  That means
that these are people who get up every day, they go to work, they
dream the American Dream, and yet, they live with the nightmare of
having no insurance for themselves and for their families.  Until we
enact real health care reform, the people of New Jersey, those with
insurance and those actually without it, won't have the peace of mind
they need to concentrate on raising their families and making that
economy as dynamic as it needs to be.

             The state's government will continue to spend 20 percent
of its entire budget on Medicaid.  That leaves very little money for
the higher education system, for law enforcement, and for
infrastructure repairs in a place like New Jersey, and this story is
repeated in every state in this union.

             And today some of my colleagues who once ran those
states -- Bruce Babbitt, former Governor of Arizona, now Secretary of
the Interior; Dick Riley, the former Governor of South Carolina, now
Secretary of Education; Henry Cisneros, the former Mayor of San
Antonio, now Secretary of HUD -- will talk to you about what it means
for them as former state and local officials.

             And so the important point here is that New Jersey is
not unique.  In every state, in every congressional district, the
problem is the same -- millions of Americans, hard-working working
Americans.  And what's fascinating about this data is, as you cut
across,s in every state 80 percent of those who are uninsured are
working and their families.

             As the Congress begins the historic debate, I hope that
they and the American people remain focused on what this is all
about.  It's not about whose bill weighs the most, it's not about
whether the Secretary of HHS is losing weight, it's not about whose
commercial to believe, it's not about whose district needs help the
most or whose special interest needs help the most, because the truth
is we need to do a lot of things in this health care system.  This
debate is about what kind of lives American people will lead, what
kind of future that we'll leave for our children.

             This debate is really about fairness and about equity.
It's about controlling and defining our future.  This health care
debate is about what kind of Americans we are and what kind we want
to be.  Thank you very much.

             Bruce.

             SECRETARY BABBITT:  Thank you, Donna.  I began my
pilgrimage toward the realization of health care issues back in 1982
when I was Governor of Arizona and we embarked upon a series of
piecemeal reforms that are actually quite similar and were quite
similar to the kinds of approaches that are being proposed today by
Senator Dole.  We first started with our Medicaid program.  We
actually didn't have a Medicaid program, and we enacted the most
radically different comprehensive Medicaid program then in existence.
And it's still in many ways a model for how it is you deal with
Medicaid.  It was the first entirely capitated, prepaid competitively
bid Medicaid program in the United States.

             With that success, we then began looking at other parts
of the system:  insurance reform, the working poor, entitlement caps,
and constructed what seemed at the time to be a fairly reasonable
approach.  And I must emphasize that this was 14 years ago, and it
sounds and echoes across that time very much in the nature of Senator
Dole's proposals.

             What we found when we had finished all this work was
that it had an ironic result, because the piecemeal reform of the
system simply began a massive process of cost-shifting onto the
center of the system which was the regular market for middle class
working families.

             And as a result of that, we look at Arizona today, look
across what's happened, the cumulative impact of all these reforms
and we have a remarkable and, I think, a sad picture that illustrates
the effects of piecemeal reform.  Under the current system, 44,000
Arizonans lose their health care insurance each month.  Now, that's
not anybody under Medicaid, that's not anybody under Medicare, it's
not anybody under all of the special programs that we have in Arizona
for targeted groups.

             Those 44,000 people who are losing, or nine-tenths of
them, are members of working families who are bringing home
paychecks, who are above the Medicaid poverty threshold.  And that
means that this year in Arizona there are half a million, 541,000
without health insurance, and 488,000 of those are in working
families.  Now, that includes 108,000 kids without health care
coverage, and that's the consequence of what I thought at the time to
be some pretty innovative stuff.  But in retrospect, for all the
sectoral benefits, inevitably those kinds of reforms begin squeezing
the costs out of the other parts of the system and shifting them onto
middle class working people.

             There are some other interesting effects of this kind of
approach to reform.  We're spending in Arizona 12 and a half percent
of our state budget on Medicaid.  Now, if Senator Dole's proposal
goes into effect, the news for Arizona is that we're going to be
spending another $1.3 billion in additional costs in the state budget
as a result of the Medicaid cap proposal.  And, don't you see, that's
exactly predictable as if it were one of Newton's Laws of Physics.
We've already learned that lesson in Arizona.  You cap one piece of
the system with the rest of the system, not taking into account --and
the costs that you drain out of that piece are simply shifted
somewhere else.

             So my message to 50 governors and 50 state legislatures
is, you had better look real careful at the Dole proposals, because
it's simply another chapter in a sad, unhappy game of cost-shifting.
It is, in fact, an unfunded mandate for all of those who are in this
town talking about it, they had better recognize that this is the
biggest unfunded mandate in modern history.

             The Arizona experience is not unique.  Somebody here has
a chart showing you the effect of all these kinds of piecemeal
proposals, thoughtful and rational as parts of the system.  But
inevitably, they result -- without a comprehensive system, they
result in two things.  One is a lot of cost-shifting.  And,
interesting enough in most cases, about half the states that have
experimented with this stuff, you actually get a slight decrease in
the number of people covered.  Once again, that's predictable.
Because as the pressure moves out of the regulated system into the
middle class working people, the insurance companies are going to do
two things:  They're going to shift costs, and they're going to start
dumping the risks.  And you can see it as you go through all the
states -- guarantee issue, guarantee renewal, portability, community
rating, voluntary alliances, tax incentives -- they all have a
familiar ring.

             The Dole people are acting as if they have discovered
something new.  They're sitting here, isolated in the cocoon of
Washington, oblivious to the reality out there on the landscape of
the last 10 years in which these things that they now propose have
all been tried, with woeful results.  In half of these states, there
are fewer people as a percentage of the total enrolled than there
were before the experiments began.

             There's on exception.  There's one exception, and that's
the State of Hawaii, in which some enlightened governors and
successive state legislatures simply said we're going to go straight
to the heart of the matter in the form of an employer mandate,
matched up with an expansion of Medicaid-style assistance in which
they have now pushed the coverage up in Hawaii significantly past 90
percent; I think about 93 or 94 percent.

             And, interestingly enough, as a result of that, health
care costs in Hawaii have actually decreased.  They're 20, 30 percent
lower than they are in other states in a state where, as every surfer
and bird-lover and tourist knows, prices are not exactly cheap.
That's the one state which has learned the lesson that's now under
debate here and acted upon.  And that, of course, is a way of saying
in conclusion simply this:  If these people, advertising all these
piecemeal reforms would get out of this town and look at what's
happened in the laboratories of democracy out there in the states, I
think it'll be crystal clear that there's only one way to go:
Learning from the experience in the 50 states.  And that's the route
toward universal coverage.

             Dick?

             SECRETARY RILEY:  I'm Dick Riley, the Secretary of
Education.  And to prove my point today, I decided to have an allergy
attack.  That's health care-related.  As former governor, much of
what Bruce Babbitt said, I would certainly second.  But I know
firsthand, and I think any governor does, how much states really need
universal health care coverage.  I certainly know that's true of
South Carolina.

             South Carolina has tried for reforms in an incremental
way.  And, really, it just simply is not working well for all the
state.  America's children need universal coverage.  With universal
coverage, every child will be able to get health care that they need,
including the important preventive services that enable them to go to
school ready to learn and enable them to stay healthy.

             Without universal coverage, millions of children are
going to remain without coverage.  In the state where I was governor,
South Carolina, is one of the states that really has tried, as I
said, for nonuniversal, incremental reform.  We learned, though, that
this nonuniversal reform simply isn't enough; since '88, the number
of working people without insurance has actually risen in South
Carolina -- risen from under 200,000 in '88 to over 497,000 today.

             We also learned that states can't go down the road to
reform on their own and do it by themselves.  The country's health
care system is broken, and only universal coverage will fix it.
Under the current system 33,000 people lose their insurance each
month in my state.  Under the current system, of the 615,000 people
without health coverage in South Carolina, 497,000 are working
families -- 497,000 out of 615,00, more than 80 percent.

             Four hundred ninety seven thousand working families in
one small state have no health insurance, and that's a 105 percent
increase, a 105 percent increase since 1988 when many of these
incremental efforts were put in place.  Twenty thousand people in
South Carolina, under a nonuniversal system will continue to lose
insurance every single month; $967 million in additional costs, as
Bruce Babbitt said, would be shifted in my state also under the Dole-
style Medicaid cap by the year 2003.

             Universal coverage is absolutely essential for the
health of America's children.  Here are just some examples of what
universal coverage will mean for America's children today.  South
Carolina, again 97,000 children will no longer go without health care
coverage; 181,000 children in Oklahoma will no longer go without
health coverage; 106,00 children in Wisconsin will no longer go
without health coverage; and 208,000 children in Louisiana will no
longer go without health coverage.  Universal health care is pro-
children, it's pro-education, and it's pro-working family.

             Thank you.

             Henry.

             SECRETARY CISNEROS:  Thank you, Mr. Secretary.  My name
is Henry Cisneros and I'm Secretary of Housing and Urban Development.
Health care reform is a community strategy as well as a strategy for
individuals and for families.  It is an issue that will make for
better cities, better communities, better neighborhoods.  America's
cities and communities need real health care reform with universal
coverage for millions of Americans.

             In my work as Secretary of Housing and Urban
Development, I've traveled the nation working with people that HUD
serves -- middle-class Americans in assisted housing; working people,
and people who live in public or other forms of subsidized housing,
all different income levels.  Very frequently, these are people who
lack health care coverage.  Now, for all of these people, whether
they be middle class or whether they be poor, the lack of health care
coverage is a serious personal problem as well as one that has
community effects.  Let me give you some examples.

             When middle class families undergo the stresses such as
I have talked to with individuals about where they lose health care
coverage or suddenly have a spouse or a child who needs massive
health care services without insurance, it's not unusual for people
to lose their homes and to suffer other effects within the
communities.  It becomes a community problem.

             Let me give you other examples of how the lack of
coverage for individuals transforms itself into a community problem.
All over the country we have central cities whose historic hospitals,
institutions that have existed for 100 years, frequently a church-
based hospital or a private hospital, are now facing the prospect of
closing their doors and leaving the community without health care at
all.  They've been there for 100 years in the center of some cities.
You name the city, I'll give you some examples.

             Why?  Because of the load of uncompensated care.  People
who come to their doors who have no health care and who must put
themselves at the mercy of the emergency rooms and trauma care units.
If you and I were to go to an emergency room of a central city
hospital on a winter night, we'll see there among the gunshot victims
and the car accident victims are children with 103 and 104 degree
fever who could have been treated by a family physician had they had
coverage, but end up in the emergency room with the flu effects of a
winter epidemic because there is no other coverage for them.

             Another example of how individual health problems become
community problems when there is no coverage is the situations that
occur when, for example, a pregnant woman has no ability to get care,
has no coverage for prenatal care.  The resulting low birthweight
births, the resulting neurodevelopmental problems, the resulting
infant mortality, which in many central cities are double and triple
the average for the rest of the population and approaching Third
World levels, are massive community problems.  We all end up carrying
the burden of neurodevelopmental problems which could have been
offset, prevented, if there were coverage for all Americans.

             Another example of how the lack of coverage affects
people's choices that affect all of us in turn in a community is the
welfare lock, the Medicaid lock.  Now, we view the lack of universal
health coverage as the single, greatest impediment to helping people
who want to escape from welfare and go to work.

             Universal coverage will free millions of Americans in
our central city, public and assisted housing residents, from the so-
called "Medicaid lock," allowing them to seek employment without fear
of losing their medical benefits for themselves and for their
children.

             Imagine the situation, the choice, the dilemma faced by
a mother who wants to work, wants to set that example, wants to make
some extra money, but who finds that because Medicaid provides
coverage, leaving Medicaid for an employer who does not provide
coverage puts her children in jeopardy of having no health services
because she makes the decision that we all encourage her to make,
which is to leave welfare and to work.

             The state implications of swollen Medicare roles are
substantial.  The current system cripples state budgets with millions
of dollars being spent on Medicaid for people who we want to leave
the Medicaid and welfare program, which could be spent on important
programs, such as housing or crime or community development or
policing or other matters, but has to be spent on Medicaid because of
the way the system works today.

             In Kentucky, it's 17.5 percent of the state budget.  In
Louisiana, it's 23.2 percent.  In Michigan, 19.4 percent -- almost a
fifth in these states of the state budget is spent on Medicaid alone.
And in my home state of Texas, it's over a fifth -- 21.2 percent.

             Let me transition to my second point, and that is a
point about Texas.  Nonuniversal care just won't do the job in Texas.
In Texas, for instance, there are 175,000 people currently losing
their health insurance every single month -- 175,000 people.  Under
nonuniversal reform, 105,000 people will continue to lose their
coverage every month.

             Of the 3.8 million people without health care coverage
in Texas -- now, just focus on that number for a minute -- in Texas,
3.8 million people without any health care coverage, 3.8 million is a
population larger than the three largest cities of Texas, larger than
the combined populations of Houston and Dallas and San Antonio
without coverage.

             Of those -- and some people would like to suggest that
that 3.8 million is mostly poor people and, therefore, they have no
identification or sympathy for them, but 3.2 million of the 3.8
million, 84 percent are working families.  And that number continues
to grow.  It's grown 27 percent -- working families, uncovered, just
since 1988.

             Let me just close by saying that a Dole-style
incremental reform will devastate the Texas state budget.  On top of
what it will deny families and individuals as they continue to be put
in a situation of losing insurance, and these numbers continue at
these high levels, it will mean for the State of Texas budget $4.1
billion in additional costs, shifted to the Texas State budget under
a Dole-style Medicaid cap.

             I think we're now prepared to answer your questions, and
Secretary Shalala will begin.

             Q    Is this concentrated attack against the Dole plan
your only major thrust today?  I mean, is this -- are you worried
about it?  Do you think it has a chance?

             SECRETARY SHALALA:  No, I think we want to make two
points today, and that is across this country the people that will be
left out if we do a piecemeal approach are working Americans and
their kids.  The only plan that the Republicans are talking about now
is actually the Dole plan, and we want to make the point that it's a
piecemeal plan.

             They still have not given us anything comprehensive for
the discussion.  And while we're prepared to mix it up with them,
it's hard to compare the comprehensive approaches that the Democratic
congressional leaders have proposed with a very piecemeal approach
that seems not to have learned from almost 20 years of trying to push
on this side and having costs pop up on this side which is what my
colleagues are making.

             Do you all want to come up, please -- I need my back
protected.  (Laughter.)

             Q    May I ask a question of all the Cabinet secretaries?

             SECRETARY SHALALA:  Sure.

             Q    Would any of you fly on a corporate jet or take
gifts from someone whom you regulate?

             SECRETARY SHALALA:  If the answer is have I, the answer
is no.

             Q    Would you?

             SECRETARY SHALALA:  No.

             Q    Would any of you other secretaries do anything of
that nature?

             SECRETARY CISNEROS:  I certainly wouldn't do it as a
matter of course, but I don't want to comment on the facts of any
other circumstance of any other secretary.  I know no other facts,
and I presume that's the underlying premise of the question.  I just
don't know the facts of any other circumstance.

             Q    Do you think that the continuing problems the
administration has had now with the appointment of a new special
counsel, the possibility of Whitewater being reopened and revisited,
the Treasury White House contacts even being revisited, doesn't this
slow down the momentum for legislative efforts --

             SECRETARY SHALALA:  Not a chance.  Not a chance.  This
health care issue is so big and so important to individual Americans.
This historic debate that's about to start this week, finally, is so
overwhelming in terms of its impact on our economy, on the ability of
our state governments to make investments on job development for
every American, but, more importantly, on the health of their
families which is fundamental, that it absolutely overwhelms any
other issue.

             Q    Secretary Shalala, you gave us the weight of this
effort.  It seems to be figures that we got from Secretary Bentsen a
few weeks ago and some other older studies.  How much money was spent
compiling this and how are you disseminating it?

             SECRETARY SHALALA:  I think that what we've done now is
we've been putting out individual pieces of data including what
Secretary Bentsen released last week.  We have added to this data on
preexisting conditions and on some other characteristics from
existing sources.  And what we've now done so that all of you, but
more importantly people from state to state can look at their own
data, is compiled and synthesized all of the data that we have on the
health condition state by state -- who has insurance, who's excluded
from insurance, who has limits on their insurance, how many people
there are with preexisting conditions who are being excluded.  And
we've done that state by state.

             So, what we've done is gone through the exercise and
pulled all the data together.  So, it's really been a synthesis of
that effort.  I don't know whether I want to go back and say what Ken
Thorpe and the HHS people took, but it's mostly a synthesis as
opposed to the recreation of absolute new data.

             Q    Do you know how much you spent doing this or is
being spent?

             SECRETARY SHALALA:  No, but, you know, whatever the
Xeroxing costs are.

             DEPUTY ASSISTANT SECRETARY THORPE:  Just my overtime.

             SECRETARY SHALALA:  He's got a fixed rate.  He's a
Deputy Assistant Secretary back there.

             Q    Can you tell me which plan you like better?  Maybe
all four of you can say which plan you prefer, the House or the
Senate?

             SECRETARY SHALALA:  We are consistent with the
President's point and that is universal coverage, private health
insurance for every American that can never be taken away.  As the
two plans in the House and the Senate demonstrate, there are
different ways to get there; but this is a bottom line for me:  Every
kid, every working parent ought to be covered in this country, and
that's what universal coverage is all about.

             SECRETARY BABBITT:  I think that's exactly right.  The
issue is the goal.  We have been for the last 10 or 15 years fixated
on attacking parts of the system, talking about incremental changes
rather than focusing on the goal.  Now, exactly how you distribute
the allocation of resources between the public sector, state, federal
and the private sector in the form of employer coverage is something
that we can continue to debate about and the Congress can continue to
work on.

             The bottom line in terms of public policy is to look out
there at that constituency -- kids, women, working families -- and
say, have we reached our goal?

             Q    If I could follow that up, though, the NGA isn't
particularly wild about the Gephardt plan, especially the expansion
of Medicare into this Part C proposal.  As a former governor, what
are your thoughts on that?

             SECRETARY BABBITT:  Well, again, it seems to me it's
perfectly reasonable in this debate to talk about whether or not you
get that coverage through expansion of public sector-financed
programs, or through participation, incentives, tax incentives,
mandates, employer coverage.

             I guess my view is, I think they're all reasonable
approaches.  The question is, when are we going to finally come down
and find the right mix?

             SECRETARY SHALALA:  Let me tell you what the NGA is
really upset about.  They're upset about shifting $48 billion in cost
to the states on fundamentally an unfunded mandate, which would have
very serious impacts on states across this country.  And that's what
the Dole plan does.  It caps Medicaid and then shifts the match onto
the states.  And my colleagues here have related what the impact is
on individual states, but nationwide it's $48 billion just shifted
directly to the states.

             That's what we've been doing all these years.

             Q    Whose definition of universal coverage were you
using when you formulated these numbers?  I mean, was it the
administration's definition, Mr. Gephardt's definition, or Mr.
Mitchell's definition?

             SECRETARY SHALALA:  Common sense.

             Q    What does that mean?

             SECRETARY SHALALA:  That means every American is
covered.  Mr. Mitchell's definition of universal coverage is 100
percent; Mr. Gephardt's is 100 percent.  Every American having access
and having the certainty of knowing that they have a health insurance
plan there for them, and that they can afford it and that it's
available to their families.

             SECRETARY BABBITT:  You want my opinion about this?
This is a theological dispute of the kind that so transfixes people
in Washington.

             The bottom line is that when you make it past 95
percent, you're inevitably on your way, clearly, to 100 percent.  I
mean, the difference between 95 percent and 100 percent falls out of
the momentum and the style of the system.

             So, rather than having a Talmudic debate about the last
5 percent, I would suggest that we get on with the program.

             Q    The President did not say he would veto anything
other than an "on your way" approach.  He said he would veto anything
other than guaranteed universal coverage.  The Mitchell bill --

             SECRETARY SHALALA:  The President was very specific.
And his own plan is similar.  And that is, put a system in place that
gets us to 100 percent.  The Mitchell plan gets us to 100 percent
with a system in place.

             Q    How?

             SECRETARY SHALALA:  It kicks in after 95 percent --first
of all, it has an oversight group and it that collects data to make
sure that we're moving toward 100 percent.

             When you get to 95 percent, it kicks in a system to get
us to 100 percent.

             Q    What is that system?

             SECRETARY SHALALA:  Let me have Ken Thorpe explain it in
great detail.  What it is, is basically a system in which
Congress -- when you get to 95 percent, Congress takes a look at
who's covered and puts new approaches in place to get to 100 percent.

             Q    Isn't that system really that the commission is set
up and that Congress can reject or accept the Commission's
recommendations, and if those recommendations are rejected, there's
nothing in the bill to get to 100 percent?

             SECRETARY SHALALA:  In the Mitchell bill, there is an
acceptance of the fact that it may take a special kind of targeted
program to get us to 100 percent, that it may take some other kind of
mechanism to get to 100 percent.

             But the goal is to get to 100 percent.  The process is
set up to get to 100 percent.  The President's own plan phased into
100 percent over a period of time.  And I really think that we're
talking about the number of angels on the head of a pin.  Both the
Gephardt and the Mitchell bills are bills that in all of their
planning, in their goals, and in their mechanisms intend to get to
100 percent.

             Q    Isn't it really the number of uninsured on the head
of pin?  I mean, you're talking about --

             SECRETARY SHALALA:  No, not if you're uninsured, it's
not the number of uninsured.

             Q    Do you have the numbers for each state and district
on how many people are gaining health insurance coverage every month,
because there must be such numbers.  Otherwise, eventually you'd run
out of people.  If everybody -- no one would have health care.

             SECRETARY SHALALA:  Well, what the numbers show you is
the number of people that lose every month, the total number of
people who are uninsured in the state in the course of a year.  I
believe they do tell you something about who comes in and out of the
health care system.

             Obviously, if you have 45,000 people in New Jersey that
are losing health insurance that month, some of them are going to
come back into the system.  So what you need is the overall number,
some kind of a snapshot during the course of a year.  You also need
to know what these numbers show you.

             Who are these people that are uninsured in America?
They are not the very, very poor because they're covered by Medicaid.
They are not the elderly because they're covered by Medicare.  They
are, in fact, working Americans often working for hourly wages or for
small businesses.

             Q    Do you have that snapshot number?

             Q    Can you provide an age and income breakdown?

             SECRETARY SHALALA:  Age and income breakdown?

             Ken, why don't you get up here and talk about the
disaggregation of the data?

             DEPUTY ASSISTANT SECRETARY THORPE:  Just real quickly,
the data that you'll see in here are really two types.  Perhaps the
easiest way to think about it is that we know on any given day there
are 37 million people who are uninsured.  It's also true that
throughout the year, that 58 million people will at some point be
uninsured.  Some of them will come back and receive health insurance;
many of them will not.

             And that's really the distinction.  The distinction is
that people lose their insurance during the year which is a very
substantial number -- one in four Americans under the age of 65.  And
those data are available by age and by income.

             Q    But these numbers that you have, the first number
for each district and, I guess state, says 75,000 people in Jim
Kolbe's district had no health care.  Is that on any given day or is
that for the whole year?

             DEPUTY ASSISTANT SECRETARY THORPE:  No, the first number
in terms of have no health coverage is at a point in time.

             SECRETARY SHALALA:  That's a snapshot.  The only way you
can collect the data is by snapshots.

             DEPUTY ASSISTANT SECRETARY THORPE:  I think it's -- when
they say losing coverage, lose every month is more is the larger
number of people who are actually every month losing their insurance.

             SECRETARY SHALALA:  What this doesn't show you different
ways to cut that data so that you have a feel for who's not insured
and how many on any given month that you have that are uninsured in a
state.

             Q    Secretary Shalala, you keep saying and the
President has said all along that health care reform would bring
guaranteed private insurance to every American.  But the Gephardt
bill would, as you know, vastly expand Medicare into a Part C, or
some people say tens of millions of Americans would end up in such a
program.  That isn't private insurance, is it?

             SECRETARY SHALALA:  Well, it does two things.  Number
one, it folds the existing Medicaid system into the Medicare system
so that there's not a change there in the status of Medicaid
recipients.  Number two, it gives people access to the federal health
care system that we all participate in which means it gives them
access to private health insurance.  Number three, it encourages, as
we have been, in the Medicare program and in other insurance.  Number
three, it encourages, as we have been, in the Medicare program and in
other federal health programs for people to get their subsidies
through the federal government but go directly into the private
health insurance plan.

             Most people don't realize Medicare is administered and
run by the private insurance companies in this country.  Blue Cross,
Blue Shield and other insurance companies bid on those contracts.  We
have private insurers running the government programs so that the
delivery system is very private and we have encouraged people to move
into the private insurance market using the government subsidies.
So, it's not inconsistent with all of the strategies, whether it's
Dole or anyone else, and that is to take government subsidies for
low-income people and to use them to buy private health insurance, to
move people into HMOs.  So, don't be mislead by, you know, even
Medicare Part C, because most of those people will eventually be in
private health insurance.  It's who pays the bill.

             Q    There is a poll today that said that 65 percent of
Americans are in favor of universal coverage that don't feel it
necessarily needs to be done this year.  They apparently don't feel
the same urgency that the administration feels.

             Can you explain that?

             SECRETARY SHALALA:  Yes.  Let me explain it from my
point of view since I spent hours answering people's questions on
radio talk shows and other situations which gave me a pretty good
feel.

             I think that the public, after being beaten upon by ads
and by these huge expenditure of interests to make them nervous and
now they're all pointing and saying the public's nervous after
they've made them nervous, the point that we continue to make is that
if we don't do it now, the health care system and reforming it is
going to be more expensive in the future.  We're trying to do two
things -- get everyone covered to improve their health, but also to
contain costs which is very fundamental here.  Costs are rising.
They may have slowed down a little while we talk; but, frankly, we
can't keep talking forever to keep costs down in this country.  We
have to have a system in place to keep costs down.  It will be more
expensive next year to go through these reforms.

             And what do you say to millions of Americans who don't
have insurance or a chance of having insurance?  Shall we wait a year
for their coverage for their families?  So, fundamentally, it costs
more to do it in the future.  There's no such thing as a status quo.
There are more people that have lost their insurance today than five
years ago or 10 years ago, as our statistics indicate, and we do feel
a sense of urgency.

             Maybe if you have great insurance yourself and you know
you're in a steady job and you're not going to lose it, you don't
feel that sense of urgency.  But talk to your next-door neighbor or
to the person down the street who lost their insurance or has a child
with a pre-existing condition or to the governor that knows what's
happening to health care costs, and they'll give you a clear reason
for doing this.

             Thank you very much.

             Q       propose to pass the Mitchell plan?

             SECRETARY SHALALA:  We're working on it.

             THE PRESS:  Thank you.

                                 END11:45 P.M. EDT