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Gov. Pawlenty: Current Health Care Plan Not Reform, Builds Upon Broken System

This is a rush transcript from "On the Record," July 28, 2009. This copy may not be in its final form and may be updated.

GRETA VAN SUSTEREN, FOX NEWS HOST: "Capital malpractice" -- that's what Minnesota governor Tim Pawlenty is calling the proposed health care overhaul. In a new report, he argues the health care plan will actually make it harder for citizens to get medical care, and it will cripple the states.

What does he mean by that? Well, let's find out. Governor Pawlenty is here to tell us. Good evening, Governor.

GOV. TIM PAWLENTY, R - MINN.: Good evening, Greta.

VAN SUSTEREN: Governor, so you've written a letter dated July 27th to the entire Minnesota delegation. What have you told them or asked them to do or not to do?

PAWLENTY: Well, what I've said, Greta, is we should set aside this health care legislation that's being debated in Congress and we should work together on those things that are common sense and bipartisan and move the nation forward on health care reform. We need it, but the fundamental premise for what the United States Congress is trying to do is to say we're going to save money by expanding access to current entitlement programs that are bankrupt and devoid of the ability to be sustained going forward. So that is not a good plan and something they should set aside.

VAN SUSTEREN: All right, now, in terms of health care reform, according to your letter, you do believe that health care reform -- in fact, you use the term it's "desperately needed" in Minnesota, but that at the current rate, that it's -- what, it's growing by 20 percent every two years, and it's likely to bankrupt Minnesota, is that right?

PAWLENTY: Greta, since 1996, our publicly subsidized health care programs in Minnesota have grown by almost 400 percent. That's similar to other states. But our federal government, our state governments, our local businesses and families are having their financial backs broken by this health care cost crisis. That's what needs to be addressed. But instead, President Obama and the Democrats are focusing just on expanding access to a broken system, rather than containing costs and creating a new and better system.

VAN SUSTEREN: What I thought was particularly interesting in your letter to the Minnesota delegation is your reference to Massachusetts and that program, in which, at least as far I can see from what you've written, that you see as a failure. And what's sort of interesting is that that's the one that your colleague in the Republican Party, Mitt Romney, was essentially overseeing or behind. So tell me, are you taking issue with what Governor Romney did in his state?

PAWLENTY: Well, the letter doesn't reference my friend, Mitt Romney. He is a friend. He's been an effective leader in so many circumstances over the years. He hasn't been governor of Massachusetts for four years, so there's a lot that's happened since he's been there.

But the short version of what happened in Massachusetts is they did succeed in expanding access to health care, but the cost of that program is now out of control. And the federal government, in many respects, is patterning what it wants to do after that Massachusetts model, and that would be financially devastating. It would not control costs. It would make costs worse. And so that is a model we do not want to follow.

But I want to make it clear Mitt Romney is a friend, and he hasn't been in charge of that system for going on four years. And do the letter doesn't even mention him by name. It just expresses a concern about that reform's...

VAN SUSTEREN: It certainly...

PAWLENTY: ... failure to control costs.

VAN SUSTEREN: It certainly does not mention his name, you know, without any doubt. You're absolutely right. But correct me if I'm wrong, didn't Governor Romney -- didn't he sort of brag about Massachusetts a little bit and about the program that they were doing to insure people? And you're saying, essentially, in the letter that, you know, it's spiraling out of control. It's not a model that you would want for your own state.

PAWLENTY: But it's also -- Greta, the more important point is the United States Congress and the Obama administration is really the issue here, and they are the ones who are embracing many elements of that Massachusetts plan. The initial cost estimates have tripled under that plan in just about 36 months. They've had to go back and raise taxes to pay for it. They're cutting benefits. And now they're even potentially seeking a federal bail-out because the costs of it have risen so wildly.

It's not a model that we should follow. It's a model the United States Congress should abandon.

VAN SUSTEREN: All right, so you tell Congress, you know, Dump this one. What's your suggestion? What would you like to see happen, Governor?

PAWLENTY: Greta, there's a number of common sense things that we could do on a bipartisan basis to move this country forward on much-needed health care reform. They include these things. First of all, let's get rid of junk lawsuits and make sure we have medical malpractice reform. That will save some money.

Number two, let's ban or prohibit people from ruling out people from being insured because of preexisting conditions. Let's make sure we have insurance that's portable, that you can take it from job to job or circumstance to circumstance. Let's incentivize e-prescribing and e- medical records to create efficiency. Let's create pay-for-performance, rather than pay for volumes of procedure. If you pay for volumes of procedure, you're going to get more procedures.

Let's fix our tax code so that if you buy insurance individually, you're not at a disadvantage compared to people who buy it through their employment circumstance. Let's allow people to buy insurance across state lines or form risk pools across state lines, and much more.

But everybody should at least be able to agree on those things, and they would save a lot of money. That would be real reform.

VAN SUSTEREN: OK, you say save a lot of money. Will it pay for it? Because that's the big -- the big problem is not just so much, you know, to improve the services -- and we do want that, but will your suggestions -- are they self-financing, or are you going to have to go out and get some money someplace, meaning taxes?

PAWLENTY: The things that I just described would be self-funding, and we've used many of them in Minnesota and have saved us money. And for example, in our state employee health plan, we have these pay-for- performance mechanisms, where we say to our state employees -- and we negotiated this with the unions -- You can go anywhere you want, but if you choose to go to an expensive place that has poor quality and poor results, you're going to pay more. In three of the last five years in Minnesota, the premium increase in those programs has been zero percent, almost unheard of in the health care marketplace.

VAN SUSTEREN: Governor, thank you, and let us know when you get a response from the Minnesota congressional delegation. Thank you, sir.

PAWLENTY: All right. Thank you, Greta.

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