Obama: ‘I just lost my grandmother last year’

President Barack ObamaBarack Hussein ObamaReport: FCC chair to push for complete repeal of net neutrality Right way and wrong way Keystone XL pipeline clears major hurdle despite recent leak MORE used a personal touch to fight back against “dishonest” critics of his efforts to reform the nation's insurance industry during a town hall Saturday in Colorado.

Speaking in Grand Junction, Co., Obama invoked his grandmother's death in 2008 to dispel rumors of “death panels.”

Obama said he was fine with having honest disagreements in the healthcare debate.

“What you can't do — or, you can, but you shouldn't do — is start saying we want to set up death panels to pull the plug on Grandma,” said Obama, who for a second time this week personalized the healthcare debate.

“I mean, come on... I just lost my grandmother last year. I know what it's like to watch somebody you love who's aging deteriorate, and have to struggle with that,” he said.

“But the notion that somehow I've run for public office or members of Congress are in this so they can go around pulling the plug on Grandma? When you start making arguments like that, that's simply dishonest.”

Former Alaska Gov. Sarah Palin has used her Facebook page in recent days to assail the Democratic healthcare efforts as a step toward “death panels” for funding such patient consultations, although other Republicans such as Sen. Johnny IsaksonJohn (Johnny) Hardy IsaksonQuestions loom over Franken ethics probe Senate ethics panel resumes Menendez probe after judge declares mistrial Signs of progress, challenges in fighting Alzheimer's MORE (Ga.) have distanced themselves from such claims, calling them “nuts.”

Palin in later posts said that Obama’s healthcare plans could lead to situations where medical resources are cut back to certain patients as part of an effort to reduce costs.

Earlier this week, Obama noted his mother died of cancer in arguing for healthcare reform.

In Colorado, he also used a confrontational question from a college student to propose a government role in the healthcare industry and turned a question from a Latino woman into an effort to combat questions of insurance “rationing.”

A day after a similar forum in Montana, Obama took direct aim at the most sensitive criticisms of the Democratic-led reform effort — specifically, a provision for government-sponsored end-of-life consultations and the fear that a public option insurance plan would lead to shrinking private insurance options. Conceding such a government role “isn't perfect,” Obama said it would improve private insurers through competition.

Under questioning by a local college student, Obama also took aim at critics of a government role in health reform, acknowledging the “legitimate debate” it represents but insisting that such a system could be crafted in a way that competes with private industry in a healthy way, such as by being required to obtain services at market rates and by not being able to simply use government funding. He raised the example of UPS and Federal Express as examples of private companies that can successfully compete against the government. He also stressed that the issue is only one component of the health reform effort.

“I think there are ways we can address those competitive issues,” Obama said. “If they're not entirely addressed, that raises a set of legitimate problems... But the notion that somehow just by having a public option you have the entire private marketplace destroyed is just not borne out by the facts... This is a legitimate debate to have. All I'm saying is that the public option, whether we have it or we don't have it, is not the entirety of health reform. This is just one sliver of it, one aspect of it.”

Obama also addressed the cost of reform, stressing that it would improve, not worsen, the country's structural imbalance. Acknowledging the concern about the cost, Obama suggested Republicans have an inherent blame because the Iraq war and President George W. Bush's tax cuts were both pushed through Congress with no corresponding spending cuts. The president also noted “the $1.3 trillion deficit that was gift-wrapped for me at the door” of the White House.

Saturday's crowd was mostly gentile, with no major disruptions or demonstrations like those that have marked several congressional forums.

In his opening remarks, Obama stressed that healthcare reform would improve American's private programs rather than interfere with them. Much of his remarks were focused on a critique of the industry, which Democratic leaders in the House have also worked to make the villains of the healthcare debate. Obama also criticized the industry in his weekly address on Saturday.

“I don’t want government bureaucrats meddling in your healthcare, but the point is, I don’t want insurance company bureaucrats meddling in your healthcare either,” Obama said in the biggest applause line of his opening remarks.

But Obama quickly ran into a questioner in Colorado who wondered how private insurance companies could compete if the government sets up a public insurance option, something Obama supports.

Obama again chastized broadcast media for reporting only the most contentious town halls, noting that several forums have featured civil exchanges that have not made the news. He made a similar point on Friday during a Montana town hall, saying television “loves a ruckus.”

The president also emphasized that “80 percent” of the American medical industry support his ideas, but compared his efforts to President Franklin Roosevelt's passage of Social Security in the 1930s and President  Lyndon Johnson's passage of Medicare in the 1960s, which he said were both opposed by special interests.

“Because we are getting close, the fight is getting fierce,” Obama said. “The history is clear: every time we are in sight of health insurance reform, the special interests fight back with everything they've got. They use their influence. They run their ads. They use their political allies to scare the American people... These struggles have always boiled down to a contest between hope and fear. That was true when Social Security was born.  That was true when Medicare was created.  It is true in this debate today.”

As he and other Democratic leaders have stressed, Obama also said reform is the only alternative to an unsustainable status quo.

“If we keep on doing what we're doing, we're in for a world of hurt. We can't afford what we're doing right now. More people are going to lose health insurance. More employers are going to drop coverage, or push more coverage onto their employees with higher premiums and higher deductibles... Mark my words: If we do nothing, at some point Medicare in about eight or nine years goes into the red... We'll either have to cut Medicare, in which case seniors will bear the brunt of it, or we're going to have to raise taxes, which nobody likes.”