This is not a fair assesment of her statement. I will explain.
Erod's reference was that of government being able to effectively lower the price of health care, and that the private sector cannot "control" costs vs. a government plan. A tragic contradiction in the face of market's ability to create efficiency with in a plethora of economic sectors.
The major contributors (leaving out malpractice issues/liability) to rising health care costs are obesity, tobacco use, and emergency room care being used by those who cannot afford/choose not to purchase private health care. Legally, at least in California, employer's are not allowed to strengthen their risk pool by charging obese people, smokers, or god forbid obese smokers more for their contribution to the HMO pool. Because of the nature of risk pools, it forces increases in contribution from the entire lot. Therefore prices are on the rise.
What the government option can provide is for people with pre-existing conditions, obesity issues, tobacco use, etc... to be moved off of private insurance pools, thereby reducing the aggregate liability. Of course, legislation would have to be enacted that would allow employers to cut off high risk employees from their lot, forcing them to either reduce their lifestyle choices to fit the mold, or become one with the government lot.
Combine this with the elimination of the court systems subsidy of ambulance chasers/malpractice lawyers and true health care reform can persist.
Medicare is needed for the same reasons. The elderly are just far to risky to insure in an affordable manner. What would be the point of saving for retirement if 75% of your entire health care costs are going to be utilized during your last year of life? My mother can be considered wealthy, but if her pre existing condition were to truly surface, she would be paying around $750,000 per year (according to her physician) and is forced to pay around $30,000/year for private insurance that only covers 70% of her total medical cost. Anecdotal i know, but it does explain the severity of the health care situation.