[Public Papers of the Presidents of the United States: William J. Clinton (1994, Book I)]
[February 16, 1994]
[Pages 265-271]
[From the U.S. Government Publishing Office www.gpo.gov]

Remarks to the American Association of Retired Persons in Edison, 
New Jersey
February 16, 1994

    Thank you. Thank you very much, Bernice. And thank you, ladies and 
gentlemen, for that warm welcome. I am delighted to be back in New 
Jersey. I always love to come here. You know, New Jersey had a lot to do 
with making me President in one of your typically close elections here. 
I keep hoping someday I'll see an election in New Jersey that's not 
close just so somebody doesn't have a heart attack right before the 
election. [Laughter]
    I'm so glad that Hillary came up here with me today. I think she 
deserves a gold medal for trying to fix the health care system. I want 
to thank Dr. Flora Edwards, the president of Middlesex Community 
College, and all of those who made it possible for us to come here and 
meet today. I want to thank my longtime friend Senator Bradley for his 
statement. He and Senator Lautenberg, who couldn't be here today, and 
the Members of Congress who are here and those who aren't are going to 
have some tough decisions to make. I thank Congressman Pallone for his 
statement. This is the second time I have been to your district to talk 
about health care. Once I was at the Robert Wood Johnson Hospital, a 
wonderful medical facility, to talk about what we were trying to do to 
help to make sure we'd have more of those kind of facilities. And I 
thank Congressmen Klein, Menendez, and Payne and Hughes also for being 
here today and coming out of their district during this congressional 
recess period.
    I'd also like to say I'm glad to be here with your new Governor, 
Governor Whitman. We had a great visit down in Washington at the 
Governors' conference. I thank you for being here. And Mayor Spadoro met 
me outside with the whole city government. I thought they were going to 
give me a list of everything they wanted from Washington. [Laughter] I 
now have met more people in this city government than most of you have, 
and I liked it, too.
    I want to thank a special person--I want to ask him to stand up--
representing the Edison Seniors Council, the man who wrote me and asked 
me to come here, David Sheehan. Where are you, David? Stand up. Thank 
you, Governor and Mrs. Florio, for coming. I'm glad to see you here. I 
want to say a special word of thanks to the AARP, to Bernice Shepard, 
and also to Kevin Donnellan and Molly Daniels and all the others who 
have worked so hard to get this group of people here.
    I was a Governor in my former life--or as I like to say, back when I 
had a life--for a dozen years, and before that, an attorney general of 
my State. And I had a long, long time to work with the AARP to do 20 or 
30 things that were important to the members of AARP in my State. And I 
always found that I could depend upon the AARP to do the right thing and 
to stand for the right thing, not only on issues that affected senior 
citizens, by the way. The AARP in our State was one of the strongest 
advocates for education reform, for example, trying to help their 
grandchildren mostly get the kind of educational opportunities that we 
would need for the 21st century. So I'm delighted to be here and 
delighted to embrace your goals of long-term care and prescription drugs 
for senior citizens.
    When I became President I had some pretty old-fashioned ideas that I 
at least thought then and now I think still are too much in absence in 
our Nation's Capital. I had the crazy idea that the purpose of our 
political system was to get people together and to get things done and 
that that was more important than all the partisan squabbling and 
personal finger-pointing and all the blame-placing and all the kind of

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stuff that we're treated to day-in and day-out, sort of emanating in 
this endless gusher of politics and negativism that our national system 
seems to produce. And I went there with the view that we ought to try to 
find a way to put that aside and actually deal with the serious problems 
of this country and to basically change and move toward the 21st century 
in ways that would guarantee the things we care most about, work and 
family and community; would enable America to go into the next century 
as the greatest country in the world, being fair to all of our people.
    In the last couple of months I've had the opportunity to review the 
progress of the past year. And I won't repeat all that now, but I think 
it's clear that we've begun to turn this economy around. The deficit is 
going down instead of up. Investment is going up instead of down. New 
jobs are coming into the economy, because the Congress took some tough 
    This year, we're trying to face some more of our problems: 
developing a new approach to education at the national level to help 
States and local school districts reach world-class goals with 
grassroots reforms; helping people who aren't going to college move from 
school to work with further training and education so their incomes will 
be decent; and developing a whole new training system for people who 
lose their jobs so that people can have the security of knowing that 
throughout their lives, they'll always be able to get the training they 
need to get newer and better jobs.
    Yesterday I went to Ohio to talk about the problem of crime, 
something that you've dealt with a lot here in the last couple of years. 
We're trying to pass a crime bill in the next few months in Congress 
that will put another 100,000 police officers on the street and take 
assault weapons off the street and put repeat violent offenders behind 
bars for good.
    So I tell you, I think we are moving in the right direction. But I 
have to say that unless we have the courage to deal with this health 
care issue, it's going to be very difficult over the long run for our 
country to be fully competitive and for your Government to fully serve 
you. Why is that? There are many reasons, but let me just give you 
three, if I might.
    First of all, nearly everybody in America's for balancing the budget 
in theory. What you need to know is, the budget we have now reduces 
defense, in my judgment, by all we can afford to reduce it and maybe 
then some a little bit. It reduces defense in the wake of the aftermath 
of the cold war. It freezes all domestic spending for 5 years, which 
means every time I want to give the State of New Jersey one more dollar 
to educate children or retrain adults or help poor kids with the Women 
and Infants Children program or the Head Start program, I have to cut 
another dollar somewhere else: total freeze.
    Social Security recipients get their cost of living increases, but 
that's tied to inflation, and it doesn't go up any faster than revenues 
do. The only thing in our budget now going up at faster than the rate of 
inflation, faster than the rate of revenues, is health care costs, 
Medicare and Medicaid, at 2 and 3 times the rate of inflation. So, (a) 
there will never be a budget in balance unless we do something to bring 
health care costs in line with inflation; (b) we will be spending all of 
our new money shortly on nothing but health care, and not new health 
care, not the long-term care you want, not the prescription drugs you 
want, but more money for the same health care. So we won't be buying 
anything new, and we will be paralyzing the whole rest of our budget. So 
that's the first thing that bothers me about it.
    The second thing you need to know is that this system is the only 
advanced system in the world--that is, no other country in the world has 
a system that doesn't provide health security for everybody, and yet we 
are spending 14.5 percent of our income, 14.5 cents of every dollar, on 
health care. Only Canada spends 10 cents; Germany and Japan are under 9. 
And we have to compete with them every day.
    And if you've seen this argument we're in with Japan now over 
cellular telephones, health care costs for the American phones are a lot 
bigger than the ones they are for the Japanese phones. Today we just 
announced we sold $6 billion worth of American-made airplanes to Saudi 
Arabia, beating out our European competitors in spite of the fact that 
there is a huge extra cost in health care in every one of those planes. 
And that means American jobs, so that bothers me.
    The third thing that bothers me is that Americans are rapidly losing 
their choices in health care and being forced into plans that give them 
almost no choice and don't cover the basic things that are needed. And 
another 100,000 Americans a month lose their health care for-

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ever. So these are the reasons I say we have to face up to this problem.
    What did Hillary say those people were in the health insurance ad, 
Harry and Louise? I always want to say Thelma and Louise; they're about 
that--[laughter]. And you know those health care ads where the actors 
are telling you how scared you ought to be of our program--they never 
put any real people on there.
    We've gotten nearly one million letters from people talking about 
their real problems in the health care system. And so, since we can't 
afford to keep up with the health insurance companies who have all of 
your premiums to buy television ads with, we just started bringing 
ordinary citizens who've written us in. I want to introduce four people 
from New Jersey who wrote us letters who are here today. I wish they had 
written us ads. Barbara Hassmiller, stand up--where are you, Barbara?--
who wrote us when her father lost his job at age 70 and had a stroke and 
was not eligible for long-term care under Medicare and was, thankfully, 
too well off to be eligible under Medicaid, the Government's program for 
poor people. Helen Kallos--where are you, Helen? Stand up--whose mother 
was taken ill at an advanced age and who wanted to help care for her 
mother at home. But under our system, you can't get any help for 
providing for your kinfolks if you keep them at home through long-term 
care. But if you're eligible, the Government will spend a fortune to put 
them in a nursing home but won't help you leave them at home for much 
less money. Margaret Meding, who discovered that her husband had a 
condition that neither Medicare nor private insurance would cover 
nursing home care for even though plainly it was the most appropriate 
thing. And finally, Arthur Paranto who had both Medicare and a Medigap 
policy, but his biggest health care problem was a huge drug bill which 
he got no help for.
    When I ran for President, starting in 1991, I met people in the 
State of New Hampshire who literally were making a choice every week 
between food in their refrigerator and medicine in the medicine cabinet 
because Medicare provided no drug coverage, and this in the country that 
has the finest pharmaceutical industry in the world, leading the world 
in all forms of medical research related to drugs; when we know, based 
on the experience of a country like Germany, for example, that if you 
provide more prescription medicine to people in a proper way, you 
actually save money on hospitalization costs and more severe medical 
costs over the long run.
    These are people you will never see in television ads, unless I can 
raise a lot more money for this campaign. But they are real people, and 
they have real problems that deserve to be addressed. They are some of 
the problems that the First Lady and her task force dealt with over a 
period of months when they consulted thousands of doctors and nurses and 
other medical providers and people in the insurance industry and 
consumers to try to come up with an approach that would deal with the 
real problems of real people, not the rhetoric that you often see in the 
    Now, I care about them. I care about the fact that there are people 
with no insurance, that there are millions of Americans with insurance 
who could lose it in a minute, that there are millions of others who pay 
too much for their insurance because they or someone in their family 
have a preexisting condition or who can never change jobs because if 
they do, they'll lose their insurance.
    Sure, I'm concerned about the small businesses who don't offer 
health insurance and are afraid they can't spend anything to provide it. 
But I'm also concerned about people like the fine husband and wife I met 
yesterday in Columbus, Ohio, in a little delicatessen, where they have 
20 employees' full-time, 20 part-time; they're not required to do 
anything. The lady had a serious medical condition; all of her 
employees' premiums went through the roof because she was sick. But she 
refused to drop their coverage. She said, ``I'm going to cover my full-
time employees, and I would gladly cover my part-time employees if only 
my competitors had to do the same.'' She said, ``You know, I'm out here 
doing this because it is morally right. I'm not going to let these 
people work for me and not have health insurance. But none of my 
competitors have to do it. We wouldn't go broke if you just required us 
all to make a fair contribution to the Nation's health care system.'' 
I'm concerned about people like her, too.
    What we're trying to do is to fix what's wrong with the system and 
keep what's right. You all know what's right. We do have the best health 
care in the world for people who have it available to them. We do have 
by far the best medical research and technology developments in the

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world. And we shouldn't do anything to mess that up. What we propose to 
do is to fix the system of financing, which is crazy and which is adding 
tens of billions of dollars to this system, dollars that you pay that 
have not anything to do with the health care of Americans.
    We want guaranteed private insurance for every American. We want 
preventive and primary care in that insurance package to save money over 
the long run. We want to protect the choices that people have. Today, 
fewer than half the people who are insured in their workplace have any 
choice anymore of their doctor or their medical plan. We want to 
increase that. We want to give small businesses and farmers and 
individuals access to the same rates that now only people who are 
insured, like me, through government or through big business have. We 
want to protect the academic health care centers like the Robert Wood 
Johnson facility I visited, and medical research. And we also know we 
have to preserve what is right for you.
    Our plan clearly preserves and strengthens Medicare. It retains your 
right to choose a physician under the Medicare program just as it 
operates today, as well as dealing with these other issues. It puts $3 
billion into medical research, including issues confronting older 
Americans like Alzheimer's, cancer, heart disease, and stroke research--
more money into medical research, not less. If there's a breakthrough 
just around the corner, we want to turn the corner in a hurry.
    But look what has got to be fixed. If we don't do anything, millions 
more will continue to lose their coverage. If we don't do anything, 
millions more will continue to pay more than they should. If we don't do 
anything, we'll still have older people being charged more for their 
health insurance than younger people when they're still in the work 
force. If we don't do anything, we will know that the insurance 
companies will continue to restrict costs and to decide who can or 
cannot be insured and under what circumstances.
    In today's system, the insurance companies regularly charge older 
people more than younger people. In today's system, older Americans are 
also regularly victimized by costly and unnecessary tests and procedures 
and by overcharging and by being sold bogus long-term policies that 
don't have the coverage they purport to have. You know that as well as I 
do. That's wrong, and we have to do something about it.
    I also want to thank Bernice for pointing out that this long-term 
care issue is not simply an issue for the elderly. We have millions of 
Americans living with various kinds of disabilities who could be much 
more productive, much less costly to society and much happier if they 
had adequate long-term care. They should also be taken into account.
    This system can also be much less expensive administratively. It is 
unbelievable: Every single solitary study that's been done of our health 
care system comparing it with any other says we spend about a dime on 
the dollar more than anybody else pushing paper around. Why? Because we 
have 1,500 separate health insurance companies with thousands and 
thousands of different policies, requiring clerical workers in 
hospitals, in doctors' offices, and insurance offices that are not 
present any other place in the world, only to make sure that nobody gets 
covered for anything that the fine print of the policy says that they're 
not covered for. Nobody else does this. Nobody in the world does this.
    And so we are paying for a paper system that is organized to keep 
people out of the health care system. So the best health care system in 
the world is not available to some people because of the paperwork 
barriers that are placed. And the people who are paying for most of 
these television ads want the paperwork barriers to stay there. Don't 
kid yourself. That is what is going on. It doesn't have anything to do 
with consumer choice. You get more choice under our plan than under the 
system they're taking us toward.
    Now the Congress is going to begin to work on these programs, and 
there will be a thousand ideas. But there are a few major plans before 
the Congress now. Only one of them proposes to keep Medicare strong and 
makes it stronger; that's our proposal. Only one of them deals with 
long-term care and prescription drugs for the elderly, our proposal.
    I have to say this in all respect: I am very grateful for the kind 
words that AARP has said about this plan. But there are interest groups 
in there spending tens of millions of dollars to beat this plan--are 
going to come after it piece by piece by piece. We are the only plan 
that offers any help for long-term care and for prescription drugs. And 
I would respectfully suggest that the AARP ought to be for the only plan 
that helps you. Otherwise, the interest groups will convince Congress 
that you don't really care,

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and you will lose these parts of our plan. The time has come to be 
counted, to stand up, to take a stand, and to fight with us if you want 
to get something done. This is a fight. And if you want it, you're going 
to have to fight for it.
    Let me also say that in addition to this issue of what new things 
can happen, you need to look at what's going to happen if our plan 
doesn't pass and someone else's idea does. There are a lot of people who 
really believe the only way to reduce the deficit and to reform health 
care is to basically take benefits away from older Americans. We have 
shown in the budget we passed this year and in the health care proposal 
we made that you can reduce the deficit and reform health care and be 
fair to older Americans.
    If we fix the health care system, you can keep the deficit on a 
downward path, as the nonpartisan Congressional Budget Office showed, 
saving unbelievable amounts of money by the first decade of the next 
century. And you can do it without slashing medical care to the elderly 
or the Social Security system. On the other hand, look at some of the 
other alternatives that are out there. Next week the Senate will 
consider a balanced budget amendment that many believe will lead to 
dramatic cuts in Social Security and Medicare without doing a thing to 
fix the health care system or to add to your security.
    Now, no one can be against a balanced budget in principle. Remember, 
I've heard all that rhetoric about cutting Government spending, but 
you're looking at the person that's bringing the deficit down, with the 
help of Congress, not letting it go up. I've heard all the rhetoric. Our 
budget proposes to eliminate over 100 Government programs and to cut 60 
percent of the specific line items in the Federal budget. So I know all 
about cutting spending. But this balanced budget amendment, according to 
every single analysis, will force either the Congress to raise taxes or 
cut Social Security and Medicare and aid to cities and States, or both, 
    The only way to get this deficit down to zero in a fair way without 
unduly cutting defense, which is not good for the country, or cutting 
Social Security and Medicare or having an unnecessary tax increase when 
we are building back for an economic recovery, is to reform the health 
care system. That is the responsible way to do it. But make no mistake 
about it, right now there are forces in the Congress who believe that 
they should use Medicare to either balance the budget or take the money 
away from seniors and pay for somebody else's health care, instead of 
asking them to take responsibility and pay a part of their own.
    If this balanced budget amendment passes, or if these other health 
care proposals were to pass, which cut Medicare--and they all do--then 
we would all be trying to do something for middle class children in the 
future by hurting middle class senior citizens today. The middle class 
has taken a big enough hit. Let's do it in the fair, right, and 
disciplined way, not the cheap, easy, quick way.
    We ought to be taking care of each other. We shouldn't pit the old 
against the young or the middle-aged. And we have a way to do it. It 
just requires us to undertake the pain of making thousands of separate 
tough decisions that will have to disappoint some people in the present 
system. But if we reform health care, we can achieve these savings 
without cutting benefits to the elderly; we can reduce the deficit 
without cutting Medicare. That's what we ought to do.
    We proposed savings in Medicare. Do you know the present budget 
estimates that Medicare and Medicaid will increase in every year in the 
next 5 years between 2 and 3 times the rate of inflation plus population 
growth? It is unacceptable. But we think those savings should be plowed 
back into benefits that help the people who actually set up and operated 
the Medicare system and helped to pay for it all these years, the people 
who paid the payroll taxes. That's how Medicare was financed, after all. 
Don't forget that.
    So we want to take the savings from Medicare, which will be achieved 
by bringing health costs in line with inflation and put them into 
providing the prescription drug benefits and put them into phasing in 
the long-term care benefits for the elderly and the disabled. That is 
the fair way to save money from Medicare, bring the deficit down, reform 
health care, and not hurt the senior citizens of the country. We don't 
need to mess up Medicare. It works. We need to add to it and strengthen 
it, and we can do that.
    I will say again, three of the four letters I received from the fine 
people that were introduced today were from people who had a prob-

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lem with long-term care, three of the four. If you are really poor in 
this country and you qualify for Medicaid, you can get in a nursing 
home. Unfortunately, most places you don't qualify for alternatives to 
nursing homes, so you may not get the best placement. But at least you 
will have some care. But if you are older and you are not really poor 
and you don't have a certain set of very unique conditions, you're out 
in the cold. And then, if you qualify for nursing home care under 
Medicare, which is reasonably rare, you still won't qualify for long-
term care any place but a nursing home. And if you're not old enough to 
be eligible for Medicare and you're disabled, then you have to be 
impoverished to be eligible for Medicaid so you go to a nursing home 
instead of getting some in-home care where you might also be able to do 
something to generate some income. This system does not make sense, and 
we can do better.
    The purpose of our common endeavors should be to allow all of us to 
rear our children with good values and a good education and a real shot 
at the American dream and then to live as long and as well as we 
possibly can, respecting the rights and the interests of our neighbors. 
We cannot do that with the health care system we have today.
    There's one other thing about this program I'd like to emphasize, 
and that is that we try to do something to protect early retirees who 
run out of their health care benefits. This is a big issue in New 
Jersey. When so many big companies are downsizing, who's there to 
protect the people who are forced into early retirement? Many of them 
lose the benefits they've paid for throughout their entire working lives 
if a company decides to save money by cutting the benefits of retirees. 
A better approach, in my opinion, is to make a commitment to these 
workers. A more fair approach would say to any retiree over 55, your 
policy is guaranteed, and all you have to do to keep your health 
benefits is to keep paying the same share you were paying when you were 
a working person. I think that's fair, and I think we ought to do it.
    Now, that is what our program does. If you want fair benefits for 
early retirees, if you want a prescription drug benefit, not just for 
the elderly but for families as well, if you want a beginning on this 
long-term care problem which is plaguing our country and something we 
had better face because people over 65 are the fastest growing 
percentage of our population, if you want health care costs brought 
under control in a way that is fair, then I would argue you have to 
support our plan. Not because you think it is perfect--this deals with a 
very complicated issue--but because it is the only plan that deals with 
these issues. And then you can come and say whatever you think about the 
edges of it.
    Now, before I close, let me just say, sometimes when a person like 
me gives a speech like this and you hear it, you say, ``Well, why is 
anybody against it?'' And you either distrust them or you distrust the 
speaker, right? Because you know it's more complicated.
    Let me restate: This fight is about who calls the shots in the 
health care system. It's about where the jobs will grow and shrink in 
the health care system, and it's about who pays, because people get 
health care. Even people without health insurance will eventually get 
health care, but normally when it's too late, too expensive, in an 
emergency room, and the rest of us pay for it.
    So this fight is about that. Should the insurance companies and the 
HMO's that they control call the shots for the future? Should they be 
the ones who decide who gets insurance and who doesn't and who pays how 
much? Should we continue to be the only advanced country in the world 
that gives all those decisions to them, with all the consequences that 
you know?
    And a lot of them--by the way, that does not mean they're all bad 
people. A lot of them are good people. A lot of them are doing the best 
they can under terrible circumstances. But this is a bad system. And a 
lot of them now say, ``Well, what we want is to give everybody access.'' 
Let me tell you what they mean, folks. They mean they want to give you 
access just like everybody in this room right now has access to a 
Mercedes, right? Or maybe to a new Chevrolet pickup truck if you're from 
my part of the country. In other words, we all have universal access 
today to every car sold in America. It's just some of us can't afford to 
buy them, right?
    So when you hear this word, perk your ears up and ask yourself, 
``Now, what do they mean by that? Give me the details.'' Say, when you 
hear that word, say, ``What do you mean by that?'' Because nobody else 
in the world that we're competing with talks about access. They say, 
``If you're a family living in our country,

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here is your health coverage, and here are your responsibilities.''
    When they say access, do they still mean we're going to charge old 
folks much more than younger people? What's covered? What are the 
benefits? What are the costs? What are the copays? What are the 
deductibles? What about the people that don't feel like helping? Listen.
    The second issue is, the tough issue is the employer mandate. Should 
we require all employers to do something toward their employees? That is 
a tough issue. I concede that. But look at what we have today. Seventy 
percent of the small businesses in America today cover their employees 
because they think it is the right thing to do. Most of them cover them 
with packages they think are not quite adequate, but it's all they can 
afford. And they pay on average 35 to 40 percent more in health 
insurance premiums than government and big business does.
    So is it fair to the 70 percent of the small businesses to do that? 
Or shouldn't we allow them to go into bigger pools where they can get 
the same rates that government and big business do, and then say to all 
small business owners, ``You have to do something to take some 
responsibility for your folks''? I think we should.
    This is a fight over jobs. If you don't need as much paperwork, if 
you have one standard form, instead of 1,500 companies writing thousands 
of different policies, you won't have to hire as many people to keep up 
with who shouldn't be covered for something. But you will have--so you 
will have fewer jobs. Let's level with you. You will have fewer jobs in 
the clerical department of hospitals, clinics and insurance companies. 
But you will have more jobs taking care of people in long-term care, 
producing pharmaceuticals, providing basic primary care in public health 
clinics in inner cities and depressed rural areas. You will have more 
jobs. So there will be a job shift.
    But we shouldn't pretend that this is easy. This is a real fight, 
and you have to decide whether that's a change you're willing to 
undertake. I tell you, I think we are willing to undertake it.
    Under our plan, which has been studied by any number of people who 
are, to put it charitably, nonbiased--everybody who studies it says more 
than half the people in this country will get the same or better health 
care for the same or lower cost. Everybody who's studied our plan says 
that there will be some more costs for some people, principally those 
who pay nothing now and for young, single, healthy workers who will have 
to pay a little more so that elderly workers can pay a little less and 
families can get a little better break. I think that's fair. And I think 
most young people think that's fair.
    This is a great opportunity for our country, because we're having an 
honest debate. I will try not to paper over the real difficulties. I 
tried to be frank with you today about what the real difficulties are. 
But I am telling you, if you want this country to be what it ought to be 
and if you want every elderly person in this country to have access to a 
life that he or she has earned by being a good American and if you want 
your children and grandchildren to grow up in an America not burdened by 
debt and not burdened by a Government strangled by health care costs and 
absolutely unable to invest in jobs and technology and education, in 
short, if you want us to do the sensible and the humane thing, then help 
us pass comprehensive health care reform that guarantees insurance to 
all Americans and has long-term care and has prescription drugs and is 
    We need your help. Thank you, and God bless you all.

Note: The President spoke at 1:40 p.m. in the gymnasium at Middlesex 
Community College. In his remarks, he referred to Bernice Shepard, AARP 
board member; Gov. Christine Whitman of New Jersey; James Florio, former 
New Jersey Governor, and his wife, Lorinda; Mayor George Spadoro of 
Edison; Kevin Donnellan, AARP legislative counsel; and Molly Daniels, 
manager, AARP health care reform help desk.