The MacNeil/Lehrer NewsHour

MR. MacNeil: Good evening. Leading the news this Wednesday, two Indian airliners crashed in separate incidents, killing 164 people. Seven Israeli soldiers were killed in a car bomb attack in Lebanon. Three Americans won the Nobel Prize for Physics, three Germans the Prize for Chemistry. We'll have details in our News Summary in a moment. Jim.

MR. LEHRER: After the News Summary, it's all about health. First, we look at a new decision about new drugs in a News Maker Interview with the head of the Food & Drug Administration, Frank Young. Then one of our Presidential campaign issue & debate segments on health care with a Tom Bearden set-up report, Bush domestic policy adviser Deborah Steelman and Dukakis surrogate, Democratic Congressman George Miller, and outside policy experts Rashi Fein of the Harvard Medical School, and Ed Haislmaier of the Heritage Foundation.NEWS SUMMARY

MR. MacNeil: Two airliners crashed in separate incidents in India today, killing a hundred and sixty-four people. An Indian Air Lines Boeing 737 flying from Bombay to Amadabad, 500 miles Southwest of New Delhi, tried to land in thick fog, but crashed and burned. Five survivors were pulled from the wreckage, but a hundred and thirty people were killed. That made it the worst single crash in the 26 year history of the airline. In Assam State, a Focher Friendship propeller plane crashed into a hillside in torrential rains. Thirty-one passengers and three crew members were feared dead. Rescue workers were unable to reach the site quickly because of dense forests and heavy rain. Jim.

MR. LEHRER: In Washington, the State Department today acknowledged a new arms for hostages deal was vetoed by the U.S. Government last spring. Spokesman Charles Redman said the proposal was raised by arms dealers who were trying to broker the sale of U.S. made F-5 jets from Chile to Iran. The arms merchants told U.S. officials four hostages could be freed if the plane deal was approved.

CHARLES REDMAN, State Department: When that came to our attention, you can imagine the answer. The answer was in no uncertain terms no. We're not going to be a party or arrange in any way for arms to be transferred to Iran. The hostage element seems to have come up only briefly and very fleetingly in the last stages, and it seems to have been raised by the brokers, not by the Iranians.

MR. LEHRER: A car bomb exploded in South Lebanon today as an Israeli Army convoy was passing. Authorities said seven Israeli soldiers were killed, another eleven wounded. The car was parked 650 feet from a border crossing point. The explosives were detonated by remote control. There was no immediate word on who was responsible for the attack. Meanwhile, a general strike closed most shops and transportation in the Israeli-occupied West Bank and Gaza Strip today. The strike was called to protest the killing yesterday of two young Palestinian boys in clashes with Israeli soldiers.

MR. MacNeil: A dozen members of Congress called on President Reagan to reorganize federal regulation of nuclear weapons plants. In a letter to the President, 11 Congressmen and Sen. John Glenn cited the safety shutdown of plants in South Carolina and Colorado and radiation leaks at a plant in Ohio. They asked the President not to let production of nuclear weapons material resume without a certification to Congress that it can be done safely. One of them, Congressman Mike Synar, a Democrat from Oklahoma, told a Washington news conference the Department of Energy was to blame for the problems.

REP. MIKE SYNAR, [D] Oklahoma: As our investigations have shown, the Department of Energy's top management is unaware of the activities at its plants, that operation officers at the Department of Energy lack technical expertise, that the contractors are exempted from all liability and accountability, and finally, contractors are rewarded despite poor safety records. Now, in such a system no one is responsible, no one is accountable, and this is anarchy.

MR. MacNeil: A coffee break inspiration at Columbia University in 1961 turned into a Nobel Prize for Physics today. Three American scientists were awarded the prize for discovering a new particle of matter, the neutrino. The $400,000 prize will be shared by Leon Lederman, Melvin Schwartz, and Jack Steinberger. Their discovery opened a new way for research into the inner most structures of matter. Three West Germans, Johan Deisenhofer, Robert Huber, and Hartmut Michel, won the chemistry prize for important discoveries in photosynthesis, chemical reactions produced by sunlight.

MR. LEHRER: The Food & Drug Administration announced new emergency drug approval procedures today. The change would permit quicker approval for drugs to be used in combating diseases such as AIDS. FDA Commissioner Frank Young made the announcement at a Washington news conference.

DR. FRANK YOUNG, FDA: This can apply primarily when the drugs are promising. And that's what this is all about, to bring to the American people promising drugsas expeditiously as possible for all diseases of individuals that are afflicted with desperate problems, life threatening diseases, or diseases with serious morbidity and great debilitation. Those are the kinds of drugs that we need for cancer, for blindness, certain types of heart disease, and most critically for AIDS.

MR. LEHRER: The National Gay & Lesbian Task Force called the FDA action a politically motivated vague proposal which threatens to lower drug approval standards. Sid Wolf, Director of the Washington-based Public Citizen Health Research Group, said the plan was a masquerade of newness.

MR. MacNeil: The Governments of Costa Rica and Nicaragua have begun evacuating thousands of coastal residents as Hurricane Joan heads towards Central America. The storm, which is now packing winds of up to 115 miles a hour, swept past Colombia yesterday, causing widespread flooding. It destroyed thousands of homes and left at least 50 people dead or missing. In South Africa, three anti-apartheid activists left the American consulate in Johannesburg after seeking refuge there for 36 days. We have a report from David Simmons of Worldwide Television News.

DAVID SIMMONS: After 36 nights' refuge in the United States Consulate, the three anti-apartheid leaders emerged to be swamped by a huge crowd. It was a significant achievement for the anti- apartheid movement. Activists chanted, "Zulu calls for power." And on a personal level too, the reappearance of Manti Marobe, Mohammed Valli Moosa, and Vusi Keneli came as good news. The three were given a guarantee from the South African Government they will not be jailed again. The five week episode was hailed as a marked success by banned anti-apartheid organizations.

MOHAMMED VALLI MOOSA, Anti-Apartheid Leader: We entered the U.S. Consulate not simply to secure our own freedom, but to stir the conscience of South Africa and the international community about the flight of our fellow detainees, people whose only crime is that they dared to resist the unjust policy of apartheid.

MR. SIMMONS: But Valli Moosa's statement by no means marks an end to their protest. At a news conference, the dissidents vowed to continue their opposition to the white ruled regime. Leader Nelson Mandella will be consulted, they said, revealing that he actually advised them to leave the Consulate's sanctuary in Johannesburg.

MR. LEHRER: There was a proposal today to shake up the ruling Communist party of Yugoslavia. It came from the party's own leadership in a response to ethnic unrest and other domestic troubles. One-third of the 165 member ruling Politburo would be removed under the plan. Five members were dropped today.

MR. MacNeil: In this country, a Congressional report said fraud and misconduct are involved in many bank failures. A panel of the House Government Operations Committee said there were abuses in nearly a third of all closings of commercial banks, and more than three-quarters of the failings in savings associations. A federal bailout of the thrift industry alone has been estimated at between 50 and 100 billion dollars. Meanwhile, it was an anniversary of sorts on Wall Street today and one that traders would like to forget. On the New York Stock Exchange, the Dow Jones Industrial Average fell more than 22 points. That put it 399 points higher than the close on Black Monday one year ago today.

MR. LEHRER: In the Presidential campaign today, Vice President Bush was in Dearborn, Michigan, to speak on foreign policy. He attacked Gov. Dukakis for what he called an unrealistic view of America's role inthe world. He also called for a renewal of a bipartisanship in making foreign policy. Gov. Dukakis was in Illinois speaking to farmers. He said Bush had never shown any concern for family farmers. Later in the day he expressed anger at a new Republican campaign pamphlet which attacks the Massachusetts prison furlough program. The brochure says, "All the murderers and rapists and drug pushers and child molesters in Massachusetts vote for Michael Dukakis." Dukakis called it "garbage unworthy of a Presidential campaign." And that's it for the News Summary tonight. Now it's on to a News Maker Interview with the head of the Food & Drug Administration and an issue & debate segment on health care in America. NEWS MAKER

MR. MacNeil: First tonight we have a News Maker Interview with the head of the Food & Drug Administration, Dr. Frank Young. As we've just reported, the FDA announced today it would formally streamline its drug approval process for treatments of life threatening illnesses. The agency has been under attack by activists who charge it with dragging its feet on new treatment for AIDS. After minimal animal studies, the normal FDA approval process has three phases. Up to 50 volunteers participate in the first phase which determines whether a drug is safe in humans. Phase Two involves much more patient testing and seeks evidence of a drug's effectiveness. The FDA has allowed some drugs to be released on a compassionate basis to seriously ill patients at this point under a new program called IND for Investigational New Drug Program. Two AIDS drugs, one of which is AZT, were released before final tests were administered. For its final and third phase, the FDA studies the drug's efficacy in large scale clinical tests which may involve more than a thousand patients. Phase Three averages four years. The whole process can take from two to ten years. More than 80 potential AIDS treatments are being tests in about 150 studies in the U.S. according to the FDA. And it's several of these drugs that AIDS activists want immediate access to. To explore today's announcements, I talked earlier with the head of the FDA, Dr. Frank Young.

MR. MacNeil: Dr. Young, what is new about this plan released today? Last year, the Department began releasing, the Administration began releasing experimental drugs like AZT for AIDS without Phase Three testing. How is this plan different from that?

DR. FRANK YOUNG, FDA: Fundamentally, it really builds on a lot that we did with the AZT model and sends a signal out to researchers, to industry, that for drugs for the desperately ill, for people with seriously debilitating diseases, we want to make it possible as a routine, not as an exception, to really work very early with FDA to bring drugs forward without Phase Three. And there are a number of other provisions that are really very different. One of them is to try to, as I discussed with Sen. Kennedy at a hearing, get in at the very early animal trial stages, because we can cut out, we feel, some of the experiments that are being done that aren't really necessary, that people think might be required. That brings us into clinical testing in man more rapidly. We also had some provisions in which we're going to try to work very rigorously in studying with the company at the end of Phase One what the type of definitive trials are that can be done in some way similar to AZT so that we can get the answers right the first time. But it's that type of an intent.

MR. MacNeil: In some cases, this would require, do I understand you correctly, that the drug company developing the drug would have to spend more money for a larger initial human test in Phase Two than is presently the case?

DR. YOUNG: Yes, it would, and that's why we've left the language permissive. We hope to be able to really add to the companies' capabilities by helping them understand the questions that FDA is going to ask up front. And if we can do that, sort of in the analogy of the baseball season, we would change from an umpire, which really said just "out" or "safe" to a catcher that would signal what the kinds of issues are, what questions are, and rely on industry to pitch the ball. But we want to be prepared to catch it. We can't prevent a pitch into the dirt, or a pitch over our heads, but we feel that if it's done right we can save about one- third to up to 50 percent of the total standard drug development time.

MR. MacNeil: Will this mean a lot of new experimental drugs quickly becoming available to people suffering from AIDS or forms of cancer or other fatal diseases?

DR. YOUNG: Your question is a very good one. It's important to point out to the American people that there's not a lot of drugs bottled up in FDA. In fact, though there are about 88 drugs being studied initially in one phase or another, that there's really not a lot of these that are about to see the light of day immediately. But I can tell you within the last week and a half, two companies have already called in and said in view of the Vice President's initiative, will you meet with us so that we can look at our drugs in a much more expeditious fashion, and I think this is going to occur. We figure that maybe about three to five to seven drugs would fall in per year to this very high category, which are either AIDS drugs or drugs for cancer, in which we might be able to give some substantial acceleration.

MR. MacNeil: Well, are there any drugs right now ending Phase Two, the normal Phase Two, which could like AZT be released to certain patients immediately? Are there any right now?

DR. YOUNG: There was one drug that I was just called out about last night to have the sponsor come in. I don't know exactly how good the data is, but I will know in the next few weeks whether that particular sponsor has information that would enable us right away to try this with that. Can't promise, but you can see there's already action here.

MR. MacNeil: Does this mean that drugs for such conditions will automatically get first priority for FDA approval for release over all other drugs? Are they going to move to the top of the list automatically now?

DR. YOUNG: In the case of AIDS, I pledged that to the nation over two years ago. This really, this action is a continuum of what I've been doing over the last four to four and a half years, namely focusing on drugs that are breakthrough drugs for desperately ill people. But for AIDS, those drugs will absolutely come to the top of the list.

MR. MacNeil: What about Parkinson's and cancers and things?

DR. YOUNG: We will do those with other drugs as well, particularly in diseases such as cancer and diseases such as Parkinson's for the central nervous system. We already have a treatment, IND, out, as you know, that's under the new regulation last May, for Parkinson's disease, and we have a number of them out for cancer.

MR. MacNeil: Well, it's, the IND that you already have out, and the approval of AIDS that makes some of your critics ask today, some of the AIDS activist forces and others say, look, there is nothing really new here. You mentioned Vice President Bush's initiative. Vice President Bush is the Chairman of a task force on regulatory relief, and these critics are saying there is nothing really new here, this is just a gimmick to help the Bush campaign, to make it look as though you're doing something when, in fact, you're not really doing anything new.

DR. YOUNG: I'm afraid that I would expect people now living in Washington for a while to be cynical about government. We'd not have thought about that probably four years ago when I was still dean, but I can tell you this. These are the changes that are there. We have put a lot of effort on AIDS all the way along. But FDA doesn't test any of these drugs, ourselves. We don't do the clinical research, but we are signaling by this initiative to companies that we want to do everything we can not only in our review time, which was what the treatment IND and the NDA reviews and the rewrites were, the other procedures, but we want to get right back into the animal studies and the clinical trials and give our best advice. So I would say to the people that would criticize this that this isn't a manipulation of a political season. In fact, I reviewed my first interviews that I gave to the press and I talked about risk/benefit back on the way in May 12th of '84, and drugs for the desperately ill in June 7th of '84, and I've been working on this all along. But it is a time now that we feel with AIDS that when you can only do the trial once, you want to do it right. I'll give you an example. Just recently there was a lot of coverage of the cessation of the trial on ampligen. I have not deliberately looked at the data, but you know the sponsor --

MR. MacNeil: What is ampligen?

DR. YOUNG: Ampligen is a drug for AIDS. It was reported as a possible success in a journal called Lancet at the Third International AIDS Meeting just about a year and a half ago. At that time, only 11 patients were studied. And people said, gee, we've got to get this drug, we've got to get this drug. And just last week, the sponsor stopped studying the drug. And these kinds of things are going to happen. So what we want to do is not promise that there are a lot of drugs there, but when we see something promising, just as we did with AZT, we want to work with the sponsor as rapidly as we can and cut through the red tape.

MR. MacNeil: Well, the other thing the critics are saying today is that the way this is worded is that it doesn't mandate anybody to do anything, that the drug companies don't have to come to you. You do not have to accelerate the procedures unless your people choose to and they say that really leaves it where it is. You may, but you don't have to.

DR. YOUNG: Not at all. In the case of FDA, the "may" is not may whatsoever. If you notice, one of the provisions in the regulation is that the commissioner and top agency officials will be very active at monitoring the process within FDA and also with out. I've learned over the 4 1/2 years, almost 4 1/2 years that I've served that I've got a very large bully pulpit. And I fully intend to use that and I have used it in the case of AIDS-related drugs. I do call sponsors and I do try to push and prime the pump as much as I can, and I intend to do that. And I think the people with AIDS have a real concern. And they have been saying that the people in the United States haven't been as sensitive to their concern. They're looking death in the eye and I worry about that with them. And in this sense, I share their agenda that I want to see these drugs come out. But they're always going to ask and I will ask until the cure comes, where's the beef, where are the drugs.

MR. MacNeil: Well, let's ask that then. Suppose one is an AIDS sufferer, desperate for something new, what is the best news you can give that person tonight that arises out of this new plan?

DR. YOUNG: I can give as the best news hope and confidence that FDA is going to work as expeditiously as possible to cut through the red tape and to remove wherever we can the longest time of testing, that is Phase Three. It's in Phase Three that you really are testing the drug in thousands of people. And that's important, because as soon as a drug is approved, and these are not conditional approvals, they're unconditional approvals, that then the reimbursement systems kick in; they're no longer experimental. That takes away the problem with the treatment IND. It also points out that the commissioner is going to be very active, as I have been -- there's no sense of saying that I haven't been active in this -- but really working to use the bully pulpit of the commissionership. It also is sending a signal to the companies to come in. A lot of the companies are responding to FDA, regretfully, as it was ten to fifteen years ago. And this sends out a very significant signal. We're not going to be just saying safe and out. We're going to be part of the game. We're going to be the catcher.

MR. MacNeil: Okay. For AIDS sufferers tonight, when is the first new drug likely to come out of the FDA under this new accelerated procedure?

DR. YOUNG: I wish I could answer that. I can't give you a timetable, but I could tell you, just as I did, that I've already had one CEO call me just last night when we were talking about something else, of the possibility of coming in in the next few weeks and seeing whether this system can be applicable. That means that we're going to start the process. I can't say exactly how long it will take, but we're already beginning, and I have one drug that's related to cancer that's very far along that we're going to give the highest priority to as well. We've got to see what the evidence is.

MR. MacNeil: Commissioner Young, thank you very much for joining us.

DR. YOUNG: You're certainly welcome. Thank you very much for the opportunity to speak with you. SERIES - '88 - ISSUE & DEBATE

MR. LEHRER: Now another in our series of special issue & debate segments from the Presidential campaign. Tonight the issue is health care. Representatives of Gov. Dukakis and Vice President Bush are here, as are two health policy experts. They follow this set-up report by Correspondent Tom Bearden.

TOM BEARDEN: Luis Ramos cannot afford the $220 a month it would take to buy health insurance for his wife and daughter. He works full-time, but his employer does not provide family medical coverage. His wife also works full-time, but she gets no insurance benefits. So when three year old Cassandra was stricken with asthma, they brought her to this free community clinic in Venice, California.

MR. BEARDEN: Does it worry you that you don't have health insurance for your wife and your child?

LUIS RAMOS, Warehouseman: Hell, yes. the first thing they ask you when you go into an emergency room is, you got insurance. That's it. That's the bottom line. If I had, you know, millions of dollars, of course, I'd take her to a specialist and hey, can't do that, you know. I ain't won the lottery yet.

MR. BEARDEN: Ramos is not alone in his difficulty in paying for medical care. Thirty-seven million Americans are uninsured. Two- thirds of those people are workers or members of their families. In California, the state with the worst problem, the uninsured have incomes ranging from under 17,000 to over 35,000 dollars for a family of four. Rick Brown compiles these statistics at UCLA.

PROF. RICK BROWN, UCLA: As an individual, if you go out to try to buy health insurance, you'll find that it's very very expensive and the coverage is almost always very poor.

MR. BEARDEN: Brown says if the medical need becomes severe enough, these people do get help, but at a high cost to society.

PROF. RICK BROWN: They end up going to either a public hospital, and then their care is paid for by taxpayers, or they'll go to a private hospital, if they can find one, that'll take an uninsured person, and those costs are then, of course, experienced by the rest of us in higher health insurance premiums.

MR. BEARDEN: In Massachusetts, Gov. Michael Dukakis this year signed into law a program he said would help the uninsured and those who pay their bills.

GOV. DUKAKIS: [Boston, April 21] The deed is done.

MR. BEARDEN: Massachusetts now provides free insurance for low income pregnant women and their children, and for two years for people who leave welfare for jobs without insurance. The state also will negotiate insurance plans for the disabled, who will be charged what they can afford. Since he became paralyzed from a spinal virus three years ago, Michael Galvin has depended on Medicaid to pay his bills, because any income would cut those benefits. He couldn't work. The new plan allowed him to take this job as a police dispatcher in Worchester.

MICHAEL GALVIN, Dispatcher: I can go to work and keep the money I'm earning without paying exorbitant medical bills. I'm not up on spending money and budgets and the state and stuff like that, so I don't know about what the cost is and I just know that it helps people.

MR. BEARDEN: Massachusetts hopes to save money by cutting the Medicaid rolls and by setting up cost containment programs. But it's estimated that in its first year of operation, the plan will cost $32 million. That figure could increase at least fivefold in the next four years as the state sets up an insurance pool for those who work but are uninsured. Tax incentives will be used to encourage and later mandate employers to provide insurance or to pay into a state pool. Exceptions will be made for new or very small businesses and for those who work seasonally or under 20 hours a week. Because of the size of the federal deficit, Dukakis says his whole plan could not be instituted nationally, but he does want to guarantee that at least working people have insurance, which he says would cost the government no extra money and save on the programs that now pick up the tab.

GOV. MICHAEL DUKAKIS: I care about the families who are one illness away, one injury away, one operation away from losing everything they've worked for, everything they've saved for, everything they've dreamed about. We'll work closely with the small business community to provide them with the same tax benefits that large benefits already get when they provide health insurance to their employees. And we'll help small businesses to buy health insurance at affordable rates.

MR. BEARDEN: Republican literature has called Dukakis "a proponent of socialized medicine", and Vice President George Bush, himself, criticized the Dukakis plan in the first debate.

VICE PRESIDENT GEORGE BUSH: [Sept. 25] One thing I will not do is sock every business in the country and thus, throw some people out of work. I want to keep this economic recovery going, more Americans at work today than at any time in history, a greater percentage ofthe work force. What I will do is permit people to buy into Medicaid. I believe that's the answer.

MR. BEARDEN: 40 percent of the poor currently are covered by Medicaid. Bush says Medicaid should be made more easily available. Dukakis counters that the Reagan Administration actually cut 700,000 children off Medicaid and cut other health programs as well. Although he has made many campaign appearances in medical settings, like this one at the Cleveland Clinic, Bush has not focused on the problems of the uninsured during speeches. But in a position paper, Bush said the answer is to "continually improve the excellent American system and to give every American a plastic card and access to our health system." He said he would also try to give employers incentives to provide health coverage. The problem of paying for medical care doesn't end when people stop working at age 65. Even though older Americans are covered by Medicare, the average couple must still spend $3,000 a year in out of pocket medical expenses. Recently, Congress passed a catastrophic health care bill which put a cap on the amount people must spend for covered medical expenses. It's a bill strongly supported by both candidates. But the catastrophic health bill provides no additional coverage for long-term care. Those in nursing homes face bills of twenty-five to thirty thousand dollars a year. Dr. Wilson Pace, who heads up graduate education in family medicine at the University of Colorado, says Medicare picks up only 2 percent of those high nursing home costs.

DR. WILSON PACE, University of Colorado: And that means that you either have individuals paying for it out of their own pocket, and then once they spend their money down, they end up going on to Medicaid, and we basically have used the Medicaid system to pick up the cost of long-term care because we don't have any other measure to do that.

MR. BEARDEN: Dr. Pace's patient, 92 year old Florence Browning, is in the process of spending all her savings.

FLORENCE BROWNING: It's taking every dime I have. I just wanted to have a savings and I wanted to give it to Betty so she could get along and she hasn't any income coming in. I'd like to go home and stay.

MR. BEARDEN: Her 68 year old daughter, Betty Calkins, tried to take care of her mother at home. When Calkins injured her back, she hired round the clock nursing care for her mother. That cost twice as much as a nursing home, and like the majority of home care, it was not covered by Medicare or Medicaid. George Bush's solutions to the problem of long-term care include allowing people to convert their IRA's and life insurance policies to pay for nursing home care, changing Medicaid requirements so the elderly don't have to go broke to qualify, and encouraging the purchase of long-term care insurance.

VICE PRESIDENT GEORGE BUSH: [Des Moines, Jan. 22] I outlined a proposal to deal with the cost of long-term care by providing incentives for people to buy long-term care insurance while ensuring that seniors who cannot afford this coverage don't have to exhaust their life savings before their spouses are eligible for Medicaid assistance.

MR. BEARDEN: Advocates for the elderly say many of the long-term care policies now available are confusing, costly and too restrictive. Dukakis wants the government to set minimum standards for such coverage. He favors financing home care as a way of keeping people out of costly nursing homes.

GOV. MICHAEL DUKAKIS: [Boston, Sept. 22] We're going to insist that Medicare pay for home health care services that are guaranteed by law, guaranteed by law, and we're going to work with that remarkable champion of the elderly, Claude Pepper, to make sure that the kind of home care that we now provide in Massachusetts is available to people all over the United States of America.

MR. BEARDEN: Both men agree that families must be educated as to the high costs of long-term care, but neither candidate talks about how to fund their proposals. When the discussion turns to health care for the elderly, there is no bottom line mentioned.

MR. LEHRER: We join some of these issues now with two people designated by the campaigns to speak for the candidates. For Bush, Deborah Steelman, the Bush Domestic Policy Adviser, for Dukakis, Congressman George Miller of California, Chairman of the House Select Committee on Children, Youth & Families. He joins us from Capitol Hill. All right, let's begin with this problem of the uninsured. How serious does the Vice President see that problem to be, Ms. Steelman?

DEBORAH STEELMAN, Bush Policy Adviser: So serious that he doesn't want to make a political football out of it. It's a very complicated problem. It's very difficult to talk about it in a political context. George Bush has a five point plan that would take me about 15 minutes to describe here on the air. He believes that we've got to focus on those who need health most first and that is pregnant women and children. In fact, yesterday, the Institute of Medicine issued a study which reiterated that belief, that we've got to have have adequate prenatal care in this country. He would also phase in for older children and would then try to reach out to lower income adults, not conditioned upon whether or they not work, such as the Dukakis plan. But obviously, this will take a long time to address, and we don't think four or five years as a timeframe in which to phase it out -- phase it in is a short one. It's a very complicated issue and we've got to work with the states and with the private sector to get it done.

MR. LEHRER: What do you think of the Dukakis proposal?

MS. STEELMAN: Well, I think it offers help to those who need it least and I think it --

MR. LEHRER: In what ways does it do that?

MS. STEELMAN: Three-quarters of the uninsured workers in this country earn less than $10,000 a year. And as your tape just showed, health care is extremely expensive. And what Gov. Dukakis is offering, most of them could not afford. In fact, in the first debate, Gov. Dukakis referenced Mr. Strickland. The Dukakis plan would not have covered him. [A] He was unemployed, and the Dukakis plan wouldn't reach him. [B] His wife had insurance available to the family through her employer, but it was unaffordable. From health care costs stem most problems and the Dukakis plan doesn't address costs or affordability at all.

MR. LEHRER: Congressman Miller, what do you think about that, first of all, her objections to the Dukakis plan?

REP. GEORGE MILLER, [D] California: Well, I think that they're really wrong and again they fail to recognize what is going on. What Gov. Dukakis is trying to do is to provide access to the American health care system for a range of individuals, both those that work, and then certainly those pregnant women and young children at the start of life that do not find coverage today. And as pointed out in your piece, some 37 million people, and what we have heard from the Vice President is that he just wants to give people a plastic card and they can buy into the Medicaid System. The fact of the matter is that the vast majority of those people can't afford to buyinto the Medicaid System, so what the Vice President is proposing is what has been estimated to be about a 20 to 24 billion dollar program that I assume would come out of the deficit, since there currently isn't any money to pay for that program. But more importantly, it would assume that no employer in this country has the wherewithal to help their employees with health insurance, and the fact of the matter is we know that a number of employers simply choose not to provide health insurance either to their worker or to the family of that worker. And we've got to direct resources at that. We cannot make this simply a governmental problem, a federal government problem. We're asking in the Dukakis proposal that employers share that burden, and where individuals can help the employer pay the premium, they should, and where individuals can help pay the government for part of its program in terms of the Early Start Program, they should. But the fact is that we see nothing from the Vice President. And for Ms. Steelman to sit there and to say that the Vice President is most concerned about those that are most vulnerable, mainly young children and pregnant women, and to watch this Vice President over eight years in the Reagan Administration cut back maternal and child health care, cut back prenatal care, cut back the women's, infants' and children's program that the Vice President said in the first debate he favored so strongly and to fight every effort to expand maternal and child health care to this most vulnerable segment of our population is just incredulous that the American people would be expected to believe this. We have never seen on the record where the Vice President fought any effort to cut health care to pregnant women and to newborn infants.

MR. LEHRER: Ms. Steelman.

MS. STEELMAN: First of all, let me say that the spending in those programs has gone up. In every one of those programs, the spending has gone up.

REP. MILLER: That's not the issue. That's not the issue. The fact of the matter is --

MS. STEELMAN: Excuse me. I didn't interrupt you, sir.

MR. LEHRER: Let her respond, please, Congressman.

MS. STEELMAN: Let me also say that Vice President Bush has specifically supported sufficient funding for women, infants, and children, has specifically supported expanding maternal and child health care block grant, has specifically made these proposals on pregnant women, children, and infants, none of which I have seen from the Dukakis campaign. Let me also say that employers --

REP. MILLER: Let me say again --

MS. STEELMAN: Let me also say that employers do a tremendous amount in this country, almost 180 million people have coverage through the employer-sponsored sector, and we do want to build on that. We want to make it possible for small businesses to offer better coverage. This is not through mandates which, in effect, will cause most people, particularly part-time people, to be thrown out of work. It's done through multiple employer trust, through state work pools, through continued incentives on fringe benefits. It's done in that fashion. It's not done through mandates.

MR. LEHRER: Well, what about the Congressman's point about that all the Vice President has proposed really at this point is a plastic card for people to go buy things they can't afford anyhow?

MS. STEELMAN: Well, as I mentioned, it's a five point program that would take me 15 minutes to discuss. It's not a plastic card, although that's in a very important point, because access to health care in this country is a problem of cost, but it's also a tremendously bifurcated delivery system. Pregnant women, for example, in many cases the enrollment process in Medicaid is so long that they've gone way past the time when they need prenatal care. A plastic card on Day One is very meaningful to that person. And I think your derogation of it is completely outlandish.

REP. MILLER: That's not the -- the point is for eight years, this administration has been in a position to expand the benefits to pregnant women, to the most vulnerable people, who are certified by medical experts to be at nutritional risk, and in 1981, this administration proposed cutting back the women's, infants', and children's program by 20 percent. They have reduced the caseload by better than 20 percent, and we know that some 80 percent of the people who are eligible for the program are not receiving the benefit today. And yet, they impounded the funds, we had to go to court to get him to release it, and never once did George Bush raise his hands in those cabinet meetings and said, this is bad for America's children, for it's poor children, for its pregnant women. That's the record of this administration.

MR. LEHRER: Ms. Steelman.

MS. STEELMAN: If I might borrow a page out of Gov. Dukakis's book, this is not running on the past; it's running on the future. And I think Vice President Bush has been very clear in many circumstances as to what he would do for pregnant women, infants and children, and would apply his resources --

REP. MILLER: Well, I think that the past, the past tells us --

MS. STEELMAN: -- to where it counts most. And I think that's very clear.

REP. MILLER: -- something about the future. Gov. Dukakis brings to this issue of health care a record of commitment, of action, of proposals, and, in fact, state laws that provide far greater benefits to the citizens of his state than are provided anywhere else and is done in cooperation with the employers in this state.

MS. STEELMAN: I find it curious, I find it curious that he intends to run on a bill which won't even take effect in Massachusetts until 1992. The fact of the matter is as to the point you raised earlier, is that he cannot be offering benefits to people they can afford.

REP. MILLER: The Vice President --

MS. STEELMAN: When we go to Medicaid, we say recognize that cost is a problem; Gov. Dukakis does not. We recognize that a subsidy is required for low income people, and we're willing to put our money where our mouth is.

REP. MILLER: How much money are you willing to put there?

MS. STEELMAN: Gov. Dukakis simply just wants to lob it off on employers and ask like it doesn't exist.

REP. MILLER: How much money are you willing to put there?

MS. STEELMAN: We are willing to phase in over a number of years, working with the states and the private sector to get the job done. We're not going to make it a political football like Gov. Dukakis has.

REP. MILLER: What happens to the people, what happens to the low income people that can't afford health care next year? What happens to the pregnant women --

MS. STEELMAN: Well, they certainly aren't helped by Gov. Dukakis's plan. What happens to the low income people who can't afford health care under our plan as we work with Medicaid to give them subsidized health care? That's something you're not willing to do.

REP. MILLER: That's not true at all. The point is we're willing to say that this is a burden of national proportion that must be shared by all parties and everybody must contribute, not just the federal deficit. The --

MR. LEHRER: What is --

REP. MILLER: -- contribute to this --

MR. LEHRER: What is definitely true at this point is we've got to move on. Don't either one of you go away. We'll be back. Robin.

MR. MacNeil: Now we turn to two experts with different views of the ills of the health care system. Ed Haislmaier is a Health Policy Analyst for the Heritage Foundation, the Washington-based conservative think tank. Rashi Fein is Professor of Economics of Medicine at the Harvard Medical School and served on the staff of President Kennedy's Council of Economic Advisers. He joins us from public television station WGBH in Boston.

MR. MacNeil: Dr. Fein, how would you compare the health care policies of Dukakis versus Bush?

RASHI FEIN, Harvard Medical School: Well, it seems to me that the Governor's proposals recognize that there is a problem, call upon the entire society, including government, to solve it, and are based on what I would characterize as statistical compassion. Let me explain. We began a segment with the stories of a few families with children that needed help. Everybody can be compassionate when they see the suffering child, the ailing mother or grandmother. The issue I think is can one be compassionate about anonymous people, about the children, about the grandmothers, and it seems to me that the Governor's program addresses "the uninsured", not the single uninsured person, but the uninsured, and I think does it in an effective way.

MR. MacNeil: What about the Bush program?

DR. FEIN: I regret to say that it's very hard, Robin, to comment on the Bush program when I've been told that it would take 15 minutes to explain the program, but I would suggest that I don't see anything in it, other than building on a program that was enacted back in the 60's as part of the great society which President Johnson when he signed the Medicaid law into being surely hoped would have been phased out by now and would have been replaced with an insurance program that everyone could participate in. I think there's a fundamental distinction between extending yet one more welfare program and trying to incorporate a program that everyone could share in equally. And I think that the Bush program, unfortunately, is built on a welfare system that is necessary but should be phased out.

MR. MacNeil: Mr. Haislmaier, how do you compare the two approaches?

ED HAISLMAIER, Heritage Foundation: Well, I think if I could use a medical analogy that the Governor's proposal has essentially diagnosed the disease incorrectly. They've misdiagnosed it, that Vice President Bush's proposal has diagnosed the disease correctly, but is only treating the symptoms and not the underlying disease.

MR. MacNeil: How has the Governor misdiagnosed the disease?

MR. HAISLMAIER: The problem with mandating health insurance on employers is that the presumption is that somehow employers are being negligent and employers are the problem. Employers aren't the problem. In fact, employers often want to provide the health insurance to their employees, because their competitors are doing so and they don't do it because they simply can't afford to do it. The problem, the real problem is cost, and while the Bush plan addresses the cost by saying, okay, we'll give some money, or we'll subsidize the purchase of health care for people, it's only addressing the symptoms. The reason we have the cost problems is we have an unsustainable rate of medical inflation in this country. We have had so for years and years and it's the product of a system that is fundamentally 40 years out of date, is backward in many of its design features, where we encourage people to purchase low, where we buy low cost health care items for people through insurance, but then leave them vulnerable to large unexpected occurrences such as long-term care for the elderly. What needs to be done is we need to go back and look at the basic premises of these programs, look at the way we regulate insurance in this country at both the federal and the state level, and start restructuring it. That's a massive undertaking. It's going to take years to accomplish, but we're not going to get satisfactory results until we do it.

MR. MacNeil: Dr. Fein, there are surveys that show that Americans are willing to spend more money on medical care, whether privately for insurance or through taxes. Are these candidates being as bold about reforming the ills of the medical system as the public would support politically in your view?

DR. FEIN: In my view, no. In my view, all of the polls indicate, have indicated for years, you're quite right, that the American public would be willing to pay higher taxes for a system that involved cost control and that brought with it equity where everyone had insurance. We're paying for it now in many ways and getting it in a most inefficient way, with an awful lot of insurance companies, and a lot of forms and a lot of payers and a lot of paper. I think that -- but I'm not running for President -- I would have said the best way, the simplest way to do it is with tax money. If we can't say the word "tax", and apparently we can't, I would choose the Governor's as a second best option. I think that what I've heard from some of our other participants is essentially that the system is out of whack and needs massive reconstruction over a number of years and I am reminded of the old union organizing song that had a refrain, "You'll get pie in the sky when you die by and by." And I don't think we can wait that long.

MR. MacNeil: Mr. Haislmaier, are the candidates being as bold as the public would support?

MR. HAISLMAIER: No, I don't think they are. And I think what you have in the health care debate -- and this is why I say the system has to be reformed -- is you see an increasing level of frustration on both sides, both liberals and conservatives, Republicans and Democrats, because there are no easy answers. The system really is fundamentally out of whack. If you look at all of those uninsured workers, every single one of those people is buying health insurance, but they're not buying it for themselves. They're buying it for the elderly through the Medicaid payroll tax. And that's hundreds of dollars a year from each one of those people. Now if you say, okay, you can keep that money and spend it on your own health care, then what do we do about the elderly? And then you look at something like the Vice President's proposal and other proposals similar to it to buy into Medicaid, and you say Medicaid was originally set up to help the poor.

MR. MacNeil: Well, what is the conservative solution then? You've heard what Dr. Fein says. He says go to taxes and do it as an overall system.

MR. HAISLMAIER: I think what we have to recognize is a couple of things here. Medical technology is moving away from the hospital at both ends, and we have based our whole system on the hospital. On the one end, it's becoming more expensive, more long-term care, nursing home, things like that. On the other end though, it's becoming much more cheap, much cheaper and much more effective, can be performed in a doctor's office. Ulcers, we treat ulcers with drug today, instead of surgery, for example. Those low cost items, people should be encouraged by changing the tax code, by expanding tax deductions, to buy for themselves. We should scale back the tax deductions for corporations and encourage health insurance to be for the really high ticket items. We should encourage health insurance for long-term care. We can't expand Medicaid to help the poor, who it was originally designed to help, because one-third of our Medicaid money is going to people who used to be middle class until they went into a nursing home. This is where the frustration comes. These problems are interrelated and you can't just have a little solution here and a solution there. You have to go back and look at the whole system.

MR. MacNeil: And that's what you think the candidates are doing?

MR. HAISLMAIER: No, they're not. They're still in the situation, as are many people in Congress, of trying to tinker a little around the edges. And it's very frustrating, and I don't think ultimately it's going to work. The only sector of this economy under which the combination of the Carter/Reagan de-control of oil and the Reagan economic recovery, the only sector that that combination didn't bring down inflation in was health care. It sticks out like a sore thumb.

MR. MacNeil: Thank you. Tinkering around the edges. Jim.

MR. LEHRER: Deborah Steelman, does Vice President Bush believe the health care system in this country is out of whack?

MS. STEELMAN: I think he takes a very serious look at what Mr. Haislmaier has said. That's why we have not made a political football of the issue, but instead, have tried to recognize some of the different problems involved, not the least of which is the fact that the Medicaid budget is currently being eaten up by long- term care expenses.

MR. LEHRER: But he says you're tinkering, that you don't have the big picture.

MS. STEELMAN: No. I think we do have the big picture because we are definitely moving toward a goal. We are trying to move toward full coverage of pregnant women and infants and children under the poverty line. We are trying to expand business-sponsored health care coverage. We are trying to provide incentives for full retirement planning, including long-term care. I think we do have the big picture. Unfortunately, a President is not a dictator. The health care system is a $500 billion system in this country. It has various components controlled by beneficiaries, others controlled by employers, others controlled by state governments, local governments, federal government. What it takes is leadership that will not be satisfied with the glib political answers, you do it employers, but will try to corral all those forces toward a common goal.

MR. LEHRER: Congressman Miller, what is Gov. Dukakis's overview as far as the system, itself. You heard what Mr. Haislmaier said. Where would he come down on what he said?

REP. MILLER: I think clearly there's a recognition, as Mr. Haislmaier has pointed out, that the American health care delivery system is out of whack with the times and the technology and the needs of that system, and clearly, corrections have got to be made, that we've relied too heavily on a hospital-based system when we know that care can be delivered more expensively and in some cases better in clinics, out in neighborhoods, through family practitioners, and at home in some instances, as was pointed out in your piece. But what disturbs me is this, is that some notion here that poor people and working people who do not have coverage, the 37 million people we discussed here, that they are somehow going to have to wait until the system is entirely made perfect. The issue that I think that the Governor is trying to raise here is access to this health care system. And I don't understand why people in highly organized jobs and people who are wealthy can have access to this system, but somehow we have to wait to correct the entire system until we can get access for these poor people. And I think what Ms. Steelman is adding in the Vice President's proposal is exactly one of the problems. She says she wants to cover pregnant women and children up to the poverty level. Pregnancies don't know whether the mother is above or below the poverty level. The child in the womb doesn't know if their mother is below or above the poverty level or the family is below or above it. The point is if you're pregnant and you need health care and you're at medical risk, we ought to get health care to you, and I think that's what --

MS. STEELMAN: Congressman Miller, that's not the Vice President's proposal. The Vice President's proposal --

REP. MILLER: You just said --

MS. STEELMAN: -- it's a phased in --

REP. MILLER: Can I finish? Can I finish?

MS. STEELMAN: No. It's a phased in approach because you've misconstrued it. We go up to 100 percent in the first year and will try to get up to 185 percent over a phased in period.

REP. MILLER: I understand that.

MS. STEELMAN: We recognize that pregnancy knows no income levels.

REP. MILLER: Maybe people should make reservations. Maybe people should make reservations to get pregnant if they're poor, or ask for 18 months pregnancies, instead of 9 month pregnancies, because the point is you're not recognizing what happens in families and the dynamics. And people that get laid off and their jobs are changing and what happens to poor people and unfortunately to all too many people in this country that go to work every day, but don't make enough money to buy health insurance.

MS. STEELMAN: Mr. Miller, may I just ask one question?

REP. MILLER: Sure.

MS. STEELMAN: The Dukakis plan does not cover unemployed people. It is not the plan he did in Massachusetts. It is not the Kennedy bill. How on earth can you say his plan helps poor people?

REP. MILLER: I understand that, and the point is what he is -- because you must understand something -- in poor families, in two- thirds of the poor families in this country, when you finish laughing, you have to understand they have one person who is working full-time --

MS. STEELMAN: Who earns less than $10,000 a year.

REP. MILLER: -- and in half of those poor families, and half of those poor families, they have two individuals that are working, and there's 11 million children. So that's a significant number of the people in this country that are uninsured currently.

MR. LEHRER: Mr. Haislmaier, which is a larger problem, cost, health care cost, or health care access?

MR. HAISLMAIER: Health care cost is the problem driving access. When we see declines in access, whether it's the uninsured who tend to be younger, or we see lack of access for the elderly, it's largely due to cost.

MR. LEHRER: So you've got to solve the cost problem before you solve the access problem?

MR. HAISLMAIER: We have to deal with the cost problem. That's what I was getting to, getting back to my original analogy, there are various proposals similar to the Bush to expand Medicaid. That is treating the symptom. That's what we can do in the short-term. It's more money for the people who need more money.

MR. LEHRER: Dr. Fein is saying, "No way, no way." Dr. Fein, what do you mean, "No way, no way"?

DR.FEIN: I don't mean that we can solve the health cost problem unless we address the equity and access problem at this very same time. If you try and just deal with the cost problem what's inevitably going to happen is some people are going to be denied care because you're going to solve the problem not by getting more efficient, but by simply lowering expenditures, necessarily public expenditures. Your first, you have to together guarantee everyone insurance and at the same time guarantee the system that we will be effective in cost control. It can be done. I have to point out that only a few hundred miles from here lies a country called Canada very much like us, and they've done it. They spend less and they have everyone insured. So that it's not like we are reinventing or inventing the wheel for the first time. The question is a matter of will and a question of somebody who wants to call it a political football call it politics, it's a question of what is the public politics on this issue that can be done?

MR. LEHRER: What about that, Ms. Steelman, he says it can be done?

MS. STEELMAN: Well, let me just say that we're not Canada, and earlier I thought I heard him saying that we shouldn't wait until they can have pie in the sky when they die. If you're talking about reinventing a system along the lines of Canada, you're talking about a twenty or thirty or forty process. I'd like to get back to the point of exactly who does need coverage in this country and the fact that, I think Mr. Haislmaier is exactly right, cost does drive the problem. Even Joe Califano the day after Gov. Dukakis announced his plan, said --

MR. LEHRER: Joe Califano --

MS. STEELMAN: Former Secretary of HEW.

MR. LEHRER: The Carter Administration.

MS. STEELMAN: -- said we all know that everyone who earns over $20,000 a year already has insurance, so to characterize this as a middle class problem is really quite wrong. What we have to do is make health care costs, health care coverage affordable for people at poverty line levels.

MR. LEHRER: So you would agree that cost drives the access problem?

MS. STEELMAN: No question about it.

MR. LEHRER: Congressman Miller, what do you think about cost versus access? Which is the most important to Gov. Dukakis?

REP. MILLER: Well, I think you may have reached agreement finally on this show that clearly cost drives access and what you usually do is lop off those people that don't have the political power to get access, don't have the money to purchase access, and that's, in fact, what has taken place in this system, because we continue to pay for a very inefficient, you know, very expensive at the end of the process means of providing health care, and you can't continue to deny people that access. If this is a system that the country is willing to live with next year and the year after, why is it that only poor people and unemployed people and uncovered working people don't have a right to have access to that system?

MR. LEHRER: Ms. Steelman.

MS. STEELMAN: Well, I don't believe you ever answered the question on what you do for the first two of those categories under the Dukakis plan, because as I read it, they are not covered. It covers only workers. And George Bush believes that we must go to those who truly have no access, those women under the poverty line, and those people up to 150 or 185 percent of poverty, working with the states to phase in coverage.

MR. LEHRER: We have run out of time. Ms. Steelman, gentlemen, thank you all very much. RECAP

MR. MacNeil: Again, the main points in today's news, 164 people died in two separate airline crashes in India, the U.S. said it rejected an offer made last spring that it sell war planes to Iran for American hostages. Seven Israeli soldiers were killed in a car bomb explosion in Lebanon. Hurricane Joan with winds increasing to 115 miles an hour threatened the coasts of Costa Rica and Nicaragua. Good night, Jim.

MR. LEHRER: Good night, Robin. We'll see you tomorrow night. I'm Jim Lehrer. Thank you and good night.