The following is a rush transcript of the August 23, 2009, edition of "FOX News Sunday With Chris Wallace." This copy may not be in its final form and may be updated.

CHRIS WALLACE, HOST: Here now to give us the latest on where the president's push for health care reform stands are two leading members of Congress.

Senator Arlen Specter, newly converted Democrat from Pennsylvania, has held four town hall meetings on health care.

Congressman Paul Ryan of Wisconsin is the top Republican on the House Budget Committee.

I want to start with the debate that you just heard about end-of- life counseling at the V.A., gentlemen.

Senator Specter, as a member — and you are — of the Veterans Committee, do you have any problems with this booklet being used for end-of-life counseling for veterans?

SEN. ARLEN SPECTER, D-PA.: I sure do. Preliminarily, let me say, Chris, that that was a tough interrogation. You're good at that. But Secretary Duckworth held her own. You can see why she's a distinguished veteran.

I start with the proposition that there's no indication that that kind of a document would be in any health care plan. And as Mr. Towey said, President Obama probably doesn't know anything about it. The document itself raises a lot of questions. And when Secretary Duckworth challenges the issue that it really is not supposed to be up there, I think consideration ought to be given right now to suspending it pending hearings before the Veterans Affairs Committee in the Senate, where I serve. And I'm going to call for those hearings first thing tomorrow.

And I wouldn't want to decide the question on a Sunday talk show, but I think we ought to have hearings, and I think Mr. Towey's exactly right. There ought not to be suggestions to encourage people to make decisions to end life, and that as between what we've heard about the current V.A. document and what Mr. Towey says, I think Mr. Towey is on a lot stronger ground.

But bear this in mind. There's no proposition now to use the V.A. document in any health care reform plan, and there is no proposition for anything resembling "death panels."

WALLACE: Congressman Ryan, I want to get on to other subjects, but briefly, your reaction to what Jim Towey calls "the death book for veterans."

REP. PAUL RYAN, R-WIS.: Well, look. These are important issues for people and their families to discuss. The question is should this be something that government's involved in.

Let's put this in the perspective of what's going on today. The Congress is about to rush through a sweeping health care overhaul which inevitably puts the government in charge of our health care sector.

And when things like this happen with government agencies, it raises all sorts of questions as to what direction we're going with health care in America, and that's why this conversation is especially relevant.

WALLACE: Let's turn to where the overall health care reform plan, to the degree that there is a plan, and there — but there's a — general outlines of one, where health care reform stands now.

I want to put up a Washington Post poll this week that found that 50 percent now disapprove of the way the president is handling health care, while 46 percent approve. In April, 57 percent approved while just 29 percent disapproved.

Senator Specter, why do you think public support for the president's handling of health care is dropping so sharply? And where do you think health care reform stands right now?

SPECTER: It is dropping because of so much misinformation. People are hearing talk about "death panels" and that would be wrong, and people don't like it.

People are hearing that they can't keep their current health plan, insurance reform plan, and they think that that is bad. People are worried about adding to the deficit and national debt, which is understandable, and the president has said that he's not going to sign a bill which adds to the deficit.

And in my four town meetings, I said I would not vote for a plan that adds to the national debt.

WALLACE: So how much trouble, Senator, do you think...

SPECTER: What I...

WALLACE: ... health care reform is in right now?

SPECTER: Well, I do not think it is in trouble. I think it is in a period of analysis and re-analysis.

Your program today, Chris, is enormously helpful to clarify an important issue, and I think that the town meetings we've had — the ones that I held were very vituperative. But I think they were organized, not that I disagree with people organizing. They have a right to do that in a democracy.

But let's not necessarily conclude that they are representative as to how people feel. Senator Casey had a town meeting on Thursday, and a lot of emotion had already been vetted, and his town meeting was very calm, very civil and constructive.

So let's proceed for the balance of the month, come back to Washington, and I think we have a good chance to get a bipartisan plan yet.

WALLACE: Let me bring Congressman Ryan in.

Why do you think that the president's health care reform — or support, public support, for his health care reform plan is dropping so sharply? And how much trouble do you think it's in?

RYAN: Well, quite simply, it's dropping so sharply because people are actually reading the legislation. They're actually seeing the details of this.

And they're seeing that the rhetoric that was used to sell this plan is completely disconnected and contrary to the substance of the plan.

And so when you put this in the context of what's happened this year - - bank bailouts, government takeovers of auto companies, massive borrowing and deficits, and now a huge takeover of our health care sector which makes our fiscal situation worse, not better — that's not my words; those are according to the Congressional Budget Office — that's what has people up in arms.

That's what has people coming to our town hall meetings worried about this legislation that is being rushed through Congress.

I mean, they're talking about employing a new procedural tactic in the Senate to rush this through with 50 votes and no more than 35 hours of debate, and so that's what people are concerned about, which is they will lose the kind of health care they've got, the government will be in a primary role of running our health care system, and this will add to our national debt, this will add to our fiscal problems.

And that is what has people up in arms.

WALLACE: The big issue now is how are Democrats going to get some measure passed. And as both of you gentlemen know, one idea is to pass health care reform under budget rules, especially in the Senate, that would require a simple majority of 51 votes and not a super majority of 60 votes.

Senator Specter, back in May, you said this, and let's put it up on the screen. "I voted against the budget because the budget has a way to pass health care with 51 votes, which undermines a basic Senate institution to require 60 votes to impose cloture on key issues."

Senator, does that mean that you will oppose splitting the bill and that you will oppose passing any of the health care reform measure under the budget reconciliation procedure?

SPECTER: Chris, I think the vastly preferable way is to go the 60 route. And with 60 Democratic senators, I think that can be done. I think the 51 approach is not desirable. As a very last, last, last resort, if you can't get anything else, I would consider it. But I think that is undesirable.

Let me comment one sentence about what Congressman Ryan said. He said care is — support is falling because people are reading the bill. Well, that's not true. There's no bill in the Senate. There's no bill on the House floor. A couple of house committees have considered it.

But let us — give us an opportunity to present a bill before people start to attribute things to a bill where there is no bill and no reason to criticize.

WALLACE: Congressman Ryan?

RYAN: The bill number is H.R.3200. It's come out of three committees and it's poised to go on the floor when we return from our August recess.

But let's — let's just take another point here. The concern here is where this is all heading. And the problem is if you use what we call reconciliation, that is really sort of denying democracy.

I think Senator Specter was right in May to protest that procedure, one that is usually resolved — used for reducing deficit and debt, not for expanding the growth of government in these kinds of programs.

And so what's the shame of all of this, Chris, is — you know, what? We could fix what's broken in health care. We could probably, in a bipartisan consensus basis, make sure that people who are uninsured get health insurance, make sure that people with pre- existing conditions get affordable care. Fix what's broken. Don't break what's working.

Unfortunately, the president and his party have chosen a different path which is a path that involves a huge takeover of our health care system by our government. And they're saying that they're going to do this with the one-party rule, which they have.

Now, obviously, elections have consequences. They have the votes to do this. And that is what has people very concerned, because this is being moved so fast without real consultation with the American people, without people understanding the consequences of what is going to take place here.

And it compounds our fiscal problems in America. We're already going bankrupt largely because of the other health care programs we have in place today. A new health care entitlement...

WALLACE: Gentlemen, we've got a little over a minute left, and I want to get to one last issue, so I'm going to ask you both to be brief on this.

Congressman Ryan, you pushed a measure in the House that if Congress passes a public option that all members of Congress, senators and congressmen, should have to go on it. What kind of support are you getting from your colleagues?

RYAN: Well, I brought this up as an amendment with Dean Heller of Nevada in the Ways and Means Committee. All but two Democrats voted against it. So it largely failed on a party-line vote.

My point is if we're going to put this on everybody else in America, we in Congress ought to be in the same plan with them. Unfortunately, that amendment has been denied every time it's been brought up in our committees.

WALLACE: Senator Specter, as you well know from your town halls, this is one of the issues a lot of doubters are asking, so let me put it directly to you. You support the public option. If it passes, will you, Arlen Specter, go on it?

SPECTER: I will consider it. I think members of the House and Senate ought to have exactly the same plans, the same options, as any citizen.

Bear in mind, Chris, the public option is an option. It is one choice you can make. And I think my situation ought to be the same as any other citizen.

Before you end, Chris, on this business about what the V.A. has, I think that there is good reason to suspend it or at least consider suspending it based on what Secretary Duckworth said.

But I think we ought to have hearings on it, and if it works out as I think it will, I would introduce legislation to prohibit the Veterans Administration from using any format, such as the one we've heard about today, which pushes pulling the plug.

WALLACE: Senator Specter, Congressman Ryan, I want to thank you both. Thanks for joining us today. And, gentlemen, please come back.

SPECTER: Nice being with you.

RYAN: Thank you, Chris.

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