    [House Hearing, 108 Congress]
    [From the U.S. Government Publishing Office]

       INVESTIGATION INTO HEALTH CARE DISPARITIES OF U.S. PACIFIC ISLAND
                                  TERRITORIES

    =======================================================================

                                    HEARING

                                   before the

                   SUBCOMMITTEE ON HUMAN RIGHTS AND WELLNESS

                                     of the

                                  COMMITTEE ON
                               GOVERNMENT REFORM

                            HOUSE OF REPRESENTATIVES

                          ONE HUNDRED EIGHTH CONGRESS

                                 SECOND SESSION

                                   __________

                               FEBRUARY 25, 2004

                                   __________

                               Serial No. 108-160

                                   __________

           Printed for the use of the Committee on Government Reform

      Available via the World Wide Web: http://www.gpo.gov/congress/house
                          http://www.house.gov/reform

                            U.S. GOVERNMENT PRINTING OFFICE

    94-494                       WASHINGTON : 2004
    _____________________________________________________________________
    For sale by the Superintendent of Documents, U.S. Government Printing
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    Fax: (202) 512-2250  Mail: Stop SSOP, Washington, DC  20402-0001

                         COMMITTEE ON GOVERNMENT REFORM

                         TOM DAVIS, Virginia, Chairman
    DAN BURTON, Indiana                  HENRY A. WAXMAN, California
    CHRISTOPHER SHAYS, Connecticut       TOM LANTOS, California
    ILEANA ROS-LEHTINEN, Florida         MAJOR R. OWENS, New York
    JOHN M. McHUGH, New York             EDOLPHUS TOWNS, New York
    JOHN L. MICA, Florida                PAUL E. KANJORSKI, Pennsylvania
    MARK E. SOUDER, Indiana              CAROLYN B. MALONEY, New York
    STEVEN C. LaTOURETTE, Ohio           ELIJAH E. CUMMINGS, Maryland
    DOUG OSE, California                 DENNIS J. KUCINICH, Ohio
    RON LEWIS, Kentucky                  DANNY K. DAVIS, Illinois
    JO ANN DAVIS, Virginia               JOHN F. TIERNEY, Massachusetts
    TODD RUSSELL PLATTS, Pennsylvania    WM. LACY CLAY, Missouri
    CHRIS CANNON, Utah                   DIANE E. WATSON, California
    ADAM H. PUTNAM, Florida              STEPHEN F. LYNCH, Massachusetts
    EDWARD L. SCHROCK, Virginia          CHRIS VAN HOLLEN, Maryland
    JOHN J. DUNCAN, Jr., Tennessee       LINDA T. SANCHEZ, California
    NATHAN DEAL, Georgia                 C.A. ``DUTCH'' RUPPERSBERGER,
    CANDICE S. MILLER, Michigan              Maryland
    TIM MURPHY, Pennsylvania             ELEANOR HOLMES NORTON, District of
    MICHAEL R. TURNER, Ohio                  Columbia
    JOHN R. CARTER, Texas                JIM COOPER, Tennessee
    MARSHA BLACKBURN, Tennessee          ------ ------
    ------ ------                                    ------
    ------ ------                        BERNARD SANDERS, Vermont
                                             (Independent)

                        Melissa Wojciak, Staff Director
           David Marin, Deputy Staff Director/Communications Director
                          Rob Borden, Parliamentarian
                           Teresa Austin, Chief Clerk
               Phil Barnet, Minority Chief of Staff/Chief Counsel

                   Subcommittee on Human Rights and Wellness

                         DAN BURTON, Indiana, Chairman
    CHRIS CANNON, Utah                   DIANE E. WATSON, California
    CHRISTOPHER SHAYS, Connecticut       BERNARD SANDERS, Vermont
    ILEANA ROS-LEHTINEN, Florida             (Independent)
                                         ELIJAH E. CUMMINGS, Maryland

                                   Ex Officio

    TOM DAVIS, Virginia                  HENRY A. WAXMAN, California
                          Mark Walker, Chief of Staff
                    Mindi Walker, Professional Staff Member
                            Danielle Perraut, Clerk
              Richard Butcher, Minority Professional Staff Member

                                C O N T E N T S

                                  ----------
                                                                       Page
    Hearing held on February 25, 2004................................     1
    Statement of:
        Camacho, Felix Perez, Governor of U.S. Territory of Guam;
          Juan Babauta, Governor, Commonwealth of the Northern
          Mariana Islands, accompanied by Dr. James U. Hofschneider,
          Secretary of Health; Togiola Tulafono, Governor, American
          Samoa; Jefferson Benjamin, Secretary of Health, Department
          of Health, Education, and Social Affairs, Federated States
          of Micronesia, Pacific Island Health Officers Association;
          and Dr. William McMillan, administrator, Guam Memorial
          Hospital Authority.........................................    76
        Cohen, David, Deputy Assistant Secretary, Office of Insular
          Affairs, U.S. Department of Interior; and Nathan Stinson,
          Jr., Deputy Assistant Secretary, Office of Minority Health,
          U.S. Department of Health and Human Services...............    21
    Letters, statements, etc., submitted for the record by:
        Babauta, Juan, Governor, Commonwealth of the Northern Mariana
          Islands, prepared statement of.............................    91
        Benjamin, Jefferson, Secretary of Health, Department of
          Health, Education, and Social Affairs, Federated States of
          Micronesia, Pacific Island Health Officers Association,
          prepared statement of......................................   124
        Bordallo, Madeleine Z., a Delegate in Congress from American
          Samoa, letter dated February 25, 2004......................    14
        Burton, Hon. Dan, a Representative in Congress from the State
          of Indiana, prepared statement of..........................     5
        Camacho, Felix Perez, Governor of U.S. Territory of Guam,
          prepared statement of......................................    81
        Cohen, David, Deputy Assistant Secretary, Office of Insular
          Affairs, U.S. Department of Interior, prepared statement of    23
        Cumings, Hon. Elijah E. Cummings, a Representative in
          Congress from the State of Maryland, prepared statement of.   150
        McMillan, Dr. William, administrator, Guam Memorial Hospital
          Authority, prepared statement of...........................   144
        Stinson, Nathan, Jr., Deputy Assistant Secretary, Office of
          Minority Health, U.S. Department of Health and Human
          Services, prepared statement of............................    32
        Tulafono, Togiola, Governor, American Samoa, prepared
          statement of...............................................   113

       INVESTIGATION INTO HEALTH CARE DISPARITIES OF U.S. PACIFIC ISLAND
                                  TERRITORIES

                                  ----------

                          WEDNESDAY, FEBRUARY 25, 2004

                      House of Representatives,
             Subcommittee on Human Rights and Wellness,
                                Committee on Government Reform,
                                                        Washington, DC.
        The subcommittee met, pursuant to notice, at 2:05 p.m., in
    room 2154, Rayburn House Office Building, Hon. Dan Burton
    (chairman of the subcommittee) presiding.
        Present: Representatives Burton, Watson, and Cummings, and
    Delegates Faleomavaega and Bordallo.
        Staff present: Mark Walker, chief of staff; Mindi Walker
    and Brian Fauls, professional staff members; Nick Mutton, press
    secretary; Danielle Perraut, clerk; Richard Butcher, minority
    professional staff member; and Cecelia Morton, minority office
    manager.
        Mr. Burton. Good afternoon. A quorum being present, the
    Subcommittee on Human Rights and Wellness will come to order. I
    ask unanimous consent that all Members' and witnesses' written
    and opening statement be included in the record. Without
    objection, so ordered.
        I ask unanimous consent that all articles, exhibits and
    extraneous or tabular material referred to be included in the
    record. Without objection, so ordered.
        Today the subcommittee has the honor of being joined on the
    dais by my esteemed colleagues, the Honorable Madeleine
    Bordallo, the Delegate to Congress from Guam, whom I had not
    had an opportunity to talk to when I was over there, but I'm
    glad she's with us today. And the Honorable Eni Faleomavaega,
    who's the Delegate to Congress from American Samoa, and a good
    golfing buddy of mine when we have a chance to get out and
    play.
        In the event of other Members of Congress joining us at
    today's hearing, I ask unanimous consent that they be permitted
    to serve as a member of the subcommittee for the day. Without
    objection, so ordered.
        I'd also like to take this opportunity to recognize a good
    friend of mine, the Honorable Pete Tonorrio, Representative of
    the United States from the Commonwealth of the Northern Mariana
    Islands. He's doing a wonderful job for the people of the CNMI
    here in Washington, and I hope 1 day to welcome him as a friend
    and duly constituted colleague here in the Congress.
        The subcommittee is convening today to examine disparities
    in the quality and access to health care experienced by the
    people of the U.S. Pacific Island Territories. We'll be
    discussing possible solutions that the Federal Government
    should seriously consider in order to alleviate these health
    burdens.
        The medical system in the Continental United States prides
    itself on the quality of medical services supplied to the
    millions of Americans under its care. Unfortunately, there are
    populations of underserved American citizens and nationals who
    do not have the same access to adequate and proper medical care
    in other regions of the world.
        These are the citizens of the U.S. Pacific Island
    Territories; namely the residents of Guam, American Samoa, the
    Commonwealth of the Northern Mariana Islands.
        In a post-September 11th society, many foreign nationals
    have been hesitant to travel to the Pacific Islands, which
    regrettably has taken a great toll on the economies of Guam,
    CNMI and the American Samoas. As a result, this has drastically
    increased rates of unemployment on the islands, and
    consequently has left tens of thousands of men, women and
    children without proper health insurance or the means for
    medical care.
        Due to these times of economic hardship, coupled with the
    caps placed on Federal Government services such as Medicaid,
    territorial governments are unable to afford the much needed
    equipment and qualified health professionals required to
    properly tend to the medical needs of their people. I had a
    chance to see that first hand during our visit over there. It's
    unconscionable that we don't do more to help those American
    citizens.
        Late last year, I had the opportunity, as I said, to travel
    to both Guam and CNMI and witness first hand the deteriorating
    health care conditions on the islands. Needless to say, I was
    extremely surprised and disappointed by the lack of sufficient
    medical resources on the islands, and thus was moved to convene
    this important hearing today to better educate my colleagues
    and the American people as well as our health agencies on the
    ongoing plight of our fellow citizens and nationals.
        One of the primary health care concerns encountered by
    these territories is the skyrocketing incidence of diabetes.
    That's something that should be researched, because there's no
    evident reason why that's happening, but it is happening. In
    recent years, the incidence of Type 2 diabetes, formerly known
    as adult onset diabetes, has reached epidemic proportions on
    these islands.
        Hundreds of these patients require constant medical
    intervention to survive, mainly in the form of dialysis
    treatments. Unfortunately, the territories are ill-equipped to
    deal with the ever-increasing demand for dialysis machines and
    trained technicians to operate them. This has resulted in long
    waiting lists and late night appointments for people in
    desperate need of life saving medical attention.
        These growing medical concerns place a tremendous budgetary
    strain on the already fragile economies of each territory.
        To further exemplify the severity of these disparities in
    health care, Guam, the largest of the U.S. Pacific Island
    Territories, has only one fully functioning civilian hospital
    to serve its nearly 170,000 citizens. Currently only about 150
    physicians reside on the island and must care not only for
    Guamanian patients but also thousands of patients who are
    transported to the territory every year from many of the
    smaller surrounding islands.
        To add insult to injury, the Guam Memorial Hospital
    Authority recently declared bankruptcy and is currently $20
    million in debt.
        Although the CNMI has a Commonwealth Health Center, the
    lack of proper equipment and health care staff forces thousands
    of patients to brave great distances overseas for care during
    medical emergency. Consequently, this is at the expense of the
    CNMI government. I think we had one case where the Speaker of
    the House had to be transported all the way to Hawaii for
    treatment because they didn't have any facilities to care for
    him on the islands.
        American Samoa unfortunately also faces these same
    predicaments, having only one medical center, LBJ Tropical
    Memorial, to service the health-care needs of its entire
    population of 60,000, much like the CNMI.
        Because the main area of concern deals with the shortage of
    qualified medical staff, the subcommittee will be receiving
    testimony from the Honorable Jefferson Benjamin, Secretary of
    Health for the Federated States of Micronesia, who will be
    speaking today on behalf of the Pacific Island Health Officers
    Association. Dr. Benjamin will discuss the ever-growing need
    for properly trained health care professionals on these
    islands. We'll also ask questions of other professionals from
    that area who will be part of the third panel.
        To gain further insight into these most important issues,
    the subcommittee has the honor of hearing today from the
    Honorable Felix Camacho, Governor of Guam; the Honorable
    Togiola Tulafono, Governor of American Samoa; and the Honorable
    Juan Babauta, Governor of CNMI.
        By the way, Governor Babauta, I would like to inform you
    that I did receive your letter regarding ``the stateless
    children of the CNMI,'' which we talked about earlier today.
    We've already instructed our staffs to start researching the
    ``stateless children'' issue in order to explore how we can
    best address a case that at first glance looks to be a
    meritorious human rights concern. We thank you for bringing
    that to our attention.
        In addition, the Honorable David Cohen, the Deputy
    Assistant Secretary of Insular Affairs at the U.S. Department
    of Interior will testify on his personal experiences observing
    health care disparities in the territories. I don't know of
    anybody that's better informed than David is. I had a chance to
    spend a lot of time with you over there, David, and we're
    really appreciative of you being here and hearing your
    testimony.
        During my visit to Guam, I had the pleasure of meeting a
    very brave man, the Honorable Vincente Pangelinan, Speaker of
    the Guam Legislature. He was invited to testify today to share
    his own personal story of this recent cardiac medical scare
    that almost claimed his life, which may have been avoided if he
    had the proper access to immediate medical care. I think he
    went to Hawaii, as I said, to take care of that.
        Unfortunately, due to continued health concerns the speaker
    was unable to come before the subcommittee today. So on behalf
    of the members of the subcommittee, I'd like to wish him well
    and we hope that he has a speedy recovery.
        The U.S. Department of Health and Human Services has
    offices and programs in place to identify and directly assist
    with underserved populations, such as the residents of the U.S.
    Pacific Island Territories. The Honorable Nathan Stinson, M.D.,
    Deputy Assistant Secretary of the Office of Minority Affairs,
    is with us here today. He will discuss current HHS initiatives
    created to help alleviate some of the problems that we're
    talking about.
        In closing, I'd like to add that the members of this
    subcommittee believe that it is one of our highest duties as
    Members of Congress to strive to find the best possible public
    policy solutions for ensuring that all Americans, any place in
    the world, have access to the highest quality health-care
    services.
        It's my sincere hope that the information shared today will
    help to provide the necessary assistance for our fellow
    Americans across the Pacific Ocean and ultimately alleviate
    this health care crisis.
        As I said to the Honorable Mr. Stinson, I hope that today
    the message will be carried back to our health agencies that
    additional resources need to be made available for these
    regions as quickly as possible, because are in dire need.
        [The prepared statement of Hon. Dan Burton follows:]
        [GRAPHIC] [TIFF OMITTED] 94494.001

        [GRAPHIC] [TIFF OMITTED] 94494.002

        [GRAPHIC] [TIFF OMITTED] 94494.003

        [GRAPHIC] [TIFF OMITTED] 94494.004

        [GRAPHIC] [TIFF OMITTED] 94494.005

        [GRAPHIC] [TIFF OMITTED] 94494.006

        Mr. Burton. With that, Mr. Faleomavaega, would you have an
    opening statement you'd like to make?
        Mr. Faleomavaega. Thank you, Mr. Chairman, for your
    leadership and your sensitivity in calling this hearing this
    afternoon, as it pertains to the health care needs of the
    insular areas. And not only as the chairman of the full
    Committee on Government Reform but also a senior member of the
    House International Relations Committee that you and I have
    served on together, I cannot thank you enough, Mr. Chairman,
    for your initiative in calling this hearing to bring to the
    attention of the Members of the Congress the problems that we
    have and health care needs, not only of the CNMI and Guam, but
    also American Samoa, although you did not have the opportunity
    of visiting my district or territory.
        In the interest of time, Mr. Chairman, I would like to
    submit my statement to be made part of the record, as I'm quite
    certain that our Governor, who will be testifying later, will
    provide the members of the committee with a very comprehensive
    overview of the health care needs of the territory.
        I also would like to offer my personal welcome to Deputy
    Assistant Secretary David Cohen, representing the Department of
    Interior, and Dr. Stinson, representing the Department of HHS.
    And my personal welcome to the Governors of the insular areas,
    Governor Babauta, my dear friend, who previously served as the
    representative of the CNMI to Congress, and is currently the
    Governor of CNMI. And also Governor Tulafono, my good friend
    here, I certainly would like to welcome him.
        Mr. Chairman, as I said earlier, I will introduce later my
    Governor when he has the opportunity to testify before our
    committee. Again, I want to give you my highest commendation.
    One of the very few occasions that committees in the Congress
    have given specific direction to look into or to focus into
    this very important area that is most needful for the insular
    areas, and I want to thank you for your initiative in calling
    this hearing this afternoon. Thank you, Mr. Chairman.
        Mr. Burton. And I want to thank you for pointing out that
    sometimes it's difficult to say these various names like
    Faleomavaega. [Laughter.]
        You've been kidding me for years about that, and it's nice
    to know you stumble just a little bit once in a while.
    [Laughter.]
        Mr. Faleomavaega. I must say, Mr. Chairman, we ran a full
    schedule today----
        Mr. Burton. Don't give me any excuses. [Laughter.]
        We had a hearing this morning, and hopefully our good
    friend Mr. Tonorrio or whoever is going to be elected by the
    good people of the Northern Marianas to give full congressional
    authority to have a representation by the CNMI.
        Also, we had the hearing for which I wasn't able to make it
    to the delegate voting procedure, or hearing that we had in the
    resources committee. I had to help with Chairman Pombo's bill
    to recognize the 50 years of the Bravo shot, or the unique
    strategic relationship that we've had with the Republic of the
    Marshall Islands, which again thank you for your support, and
    for which Chairman Hyde and our ranking senior member, Mr.
    Lantos, and the members of our International Relations
    Committee approved the bill and the resolution.
        Hopefully it will be considered by the full House before
    March 1st, because that is the day we're looking at as the
    basis of which the resolution was introduced. We ought to
    recognize the tremendous contributions that the people of the
    Marshall Islands have given to our country in the last 50
    years. Many of the Americans don't even know that one of the
    best missile testing operations going on in the Pacific lies in
    the Marshall Islands. And the fact that the Marshal Islands
    also was the home port where we tested some 67 nuclear devices,
    which kind of kept us on the go in our competition with the
    Soviet Union and defeating communism. I would be remiss if I
    did not mention the fact that the people of the Marshall
    Islands have made a tremendous contribution, and hopefully, we
    will have a chance to go and visit those islands again.
        Thank you, Mr. Chairman, again, and you can call me John
    Wayne any time you want, Mr. Chairman, if Faleomavaega sounds
    too complicated. [Laughter.]
        Mr. Burton. You know, that very nice comment that you made
    about the Marshall Islands, I thought for a moment you were
    going to run for delegate from there.
        Ms. Bordallo.
        Ms. Bordallo. Thank you very much, Mr. Chairman.
        I want to say this before I begin my very short testimony
    here, that the territories have been very fortunate in the past
    month or so. We are getting visits from a number of Members of
    Congress and most recently the Secretary of Interior. I think
    that once you visit Guam, as you have, Chairman Burton, that
    you will be friend of the territories forever. Once you get out
    and visit the Pacific areas, meet our people, learn about our
    customs and our traditions, you will fall in love with the
    islands.
        So the more that we can invite Members of Congress to come
    and visit us, I think they will understand more about us and
    the difficulty we have on many issues.
        I want to thank you, Chairman Burton, for holding this
    hearing today on health care disparities in the U.S. Pacific
    Territories. And I want to especially welcome the Governor of
    Guam, the Governor of CNMI and the Governor of American Samoa,
    Presidents of the Senate are here, other distinguished visitors
    from several of our territories are in the audience today. I
    want to thank you very much. And of course, our Secretary David
    Cohen, who's been on the witness stand most of the day today,
    in different public hearings and all the others who are here.
        Mr. Chairman, as you said earlier, you have visited Guam
    and the Northern Marianas, and you have seen first hand the
    challenges that we face in providing quality health care for
    our communities. I'm particularly pleased that you had an
    opportunity to visit the Guam Memorial Hospital and that you
    were well briefed by Hospital Administrator Bill McMillan and
    the Director of Public Health on Guam, and the Director of
    Public Health on Guam, Mr. Peter John Camacho.
        The issue of disparities manifests itself in higher
    occurrence of serious and chronic diseases and in mortality
    rates that exceed national averages. The question here is
    whether these health disparities are further enhanced by the
    lack of adequate Federal funding. As you are aware, the
    territories have a Medicaid cap that limits the amount of
    Federal Medicaid funding to about 20 percent of actual costs
    for indigent medical care.
        The recent Medicare prescription drug benefit contains a
    new cap for the territories, which is a great concern to our
    constituents. While Medicare subscribers on Guam pay into the
    system, their prescription drug benefit would not be the same
    as a Medicare subscriber in one of the United States.
        We now have a new disparity, Mr. Chairman, in another
    Federal health care program. By every health indicator, the
    territories lag behind the States, and are now near Third World
    levels. Perhaps our distances and our remote locations
    contribute to this situation. However, the disparities may in
    fact be caused by the disparities in Federal programs,
    especially where these Federal programs directly impact the
    indigent population.
        The greatest irony is that these are the very same programs
    that are meant to extend the benefits of quality health care to
    the most vulnerable population throughout the United States. It
    is not just unfortunate that Medicaid and SCHIP and Medicare
    have caps, but it is tragic for those who depend on those
    programs for their basic health care needs.
        Mr. Chairman, I want to thank you for your commendable
    interest in these issues, and I hope the information we learn
    today from the territorial representatives will help us to
    formulate a strategy to address the caps in Federal health
    programs, and to put the Federal resources where they are
    needed the most.
        Mr. Chairman, I would like to enter into the record my full
    statement, along with a statement from Speaker Ben Pangelinan
    and Senator Luli Angararo.
        [The information referred to follows:]
        [GRAPHIC] [TIFF OMITTED] 94494.007

        [GRAPHIC] [TIFF OMITTED] 94494.008

        [GRAPHIC] [TIFF OMITTED] 94494.009

        [GRAPHIC] [TIFF OMITTED] 94494.010

        [GRAPHIC] [TIFF OMITTED] 94494.011

        [GRAPHIC] [TIFF OMITTED] 94494.012

        [GRAPHIC] [TIFF OMITTED] 94494.013

        Mr. Burton. Thank you, yes, we will put your whole
    statement into the record, without objection.
        Ms. Bordallo. Thank you.
        Mr. Burton. We will now swear in our witnesses. Will you
    both rise, so I can get you sworn? Raise your right hands,
    please.
        [Witnesses sworn.]
        Mr. Burton. Since you're a friend of mine after our trip
    over there, David, I think we'll start with you, the Honorable
    Mr. Cohen.

    STATEMENT OF DAVID COHEN, DEPUTY ASSISTANT SECRETARY, OFFICE OF
       INSULAR AFFAIRS, U.S. DEPARTMENT OF INTERIOR; AND NATHAN
     STINSON, JR., DEPUTY ASSISTANT SECRETARY, OFFICE OF MINORITY
          HEALTH, U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES

        Mr. Cohen. Thank you very much, Mr. Chairman. Thank you,
    members of the subcommittee and guest members for today.
        I'm pleased to appear before you today to discuss health
    care in Guam, American Samoa and the CNMI. I would summarize
    our assessment of health care issues in the Pacific Territories
    with the following observations. No. 1, we don't know enough.
    No. 2, what we do know causes us concern. Health care in the
    Pacific Territories faces many daunting challenges.
        One of the greatest challenges is that the last
    comprehensive study on health was published in the mid-1990's
    by the Institute of Medicine. The comprehensive health care
    data we use today are dated and inadequate. Existing evidence
    suggests that our own communities face the likelihood of poor
    health. Factors that contribute to this prospect are economic
    hardship, poverty, joblessness and under-employment, limited
    primary and specialty care, and the under-utilization of
    services.
        Health problems are exacerbated by a number of systemic
    problems. The tradition of heavily subsidized health care in
    the Pacific Territories can sometimes impede investment in
    health care. Health care management systems have not
    efficiently allocated the limited health care resources that
    are currently available. A perennial lack of funds is a problem
    for improving facilities, buying up to date equipment,
    purchasing sufficient supplies and drugs and paying for off-
    island medical referrals, which are very important in the
    islands.
        Unlike the States, Medicaid reimbursements to the
    territories, as the Congresswoman has noted, are subject to
    caps. They are also subject to a reimbursement formula that is
    much less favorable than what States are eligible for.
        Like the general U.S. population, island communities suffer
    diseases related to the cardio and cerebral vascular system,
    cancer, and of course injuries. Nutritional diseases such as
    diabetes and obesity are also leading causes of death. Of the
    serious diseases faced by the resident of the territories, many
    are chronic diseases precipitated by lifestyle choices.
        Over the last 50 years, island populations have
    increasingly adopted our mainland diet, with its emphasis on
    processed foods that are high in fat, high in carbohydrates and
    low in fiber. Island residents have also moved toward more
    sedentary work. Smoking is another major risk factor.
        The good news is that lifestyle choices can eliminate many
    of the diseases discussed above. Educational efforts therefore
    could produce positive health results.
        The lack of funds dedicated to health care is an
    overarching problem. Isolation and distance from metropolitan
    centers contributes significantly to this deficit in resources.
    Shipping costs are vastly increased for all things needed by
    island health care systems. It's difficult to attract off-
    island doctors, nurses and other personnel to the respective
    islands on a long term basis. Off-island medical referrals for
    specialized treatment consume large portions of each
    territory's health care budget. The acquisition of technical
    assistance for solving health care problems usually involves
    inordinate delays and complications.
        In addition, air travel makes the territories vulnerable to
    infections from the outside. Diseases such as tuberculosis and
    measles, which are less controlled in Third World countries
    than in the United States, make appearances from time to time
    in the territories. They must be dealt with on an emergency
    basis.
        Under the compacts of free association, approximately 6,900
    Freely Associated State's citizens are now in Guam and 2,100 in
    the CNMI. Respiratory disease seems to be more prevalent in the
    FAS than in the U.S. Territories. Marshallese women have five
    times the breast cancer rate of Caucasian women in the United
    States, and 75 times the rate of cervical cancer. With FAS
    migration, the health problems of the FAS become the health
    problems of Guam and the CNMI.
        Over the next 20 years, the Office of Insular Affairs will
    provide approximately $76 million in assistance to the
    Federated States of Micronesia and approximately $33 million in
    sector grants to the Republic of the Marshall Islands, under
    the revised compacts of free association. This assistance will
    include as a top priority funds targeted at improving health of
    the citizens of the FSM and RMI in their home countries.
        Assuming improved health, education and economic
    opportunity, there will be two benefits, we hope. One, fewer
    FAS citizens may find it necessary to migrate to Guam and the
    CNMI, and two, those FAS citizens who do migrate will likely be
    healthier.
        We also provide now compact impact funds under the compact
    to compensate not only for the health effects of migration and
    the strain of local health care budgets, but also education and
    other types of services as well, $14.2 million this year for
    Guam and $5.1 million for the CNMI.
        The Office of Insular Affairs provides a variety of types
    of technical assistance funds for a variety of health care
    needs. These are summarized in my written statement. Our
    technical assistance program is well received in the
    territories and our assistance, along with HHS grants, can only
    constitute a small part of each individual territory's health
    care financing.
        Mr. Chairman, we welcome the subcommittee's interest in the
    territory's health care challenges, and look forward to working
    with you on these important issues. Thank you.
        [The prepared statement of Mr. Cohen follows:]
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        Mr. Burton. Thank you, David. I hope you don't mind me
    calling you David instead of Mr. Secretary, since we were
    traveling together and everything over there.
        Mr. Cohen. I much prefer it.
        Mr. Burton. Thank you.
        Dr. Stinson.
        Dr. Stinson. Thank you very much.
        Good afternoon. My name is Nathan Stinson, Deputy Assistant
    Secretary for Minority Health and the Director of the Office of
    Minority Health in the Department of Health and Human Services.
    Thank you for the opportunity to testify today on the
    Department's activities on Guam, American Samoa and the
    Commonwealth of the Northern Mariana Islands. I will refer to
    them as the Pacific Island Territories in our oral remarks. A
    complete written testimony is submitted to the committee for
    the record.
        I appreciate the committee's interest in this region. The
    people of the Pacific Islands have many serious health problems
    and are medically underserved. Let me start with some of the
    particular barriers and challenges, many of which, Mr.
    Chairman, you are aware. The remoteness of the Pacific Islands,
    as well as the wide difference in the time zone redefines the
    term difficulty in access to care. The inadequate nature of the
    basic health infrastructure, as well as the manpower shortages,
    are factors complicating their ability to deliver quality of
    care to more than 180,000 residents.
        In order to better understand the Department's programs for
    the Pacific Island Territories, I would like to mention some of
    the other obstacles faced by providers and their patients
    alike. I will share with you a few examples of some of the
    stories that we have heard as far as issues that complicate
    their ability to provide the level of care they are interested
    in.
        There are oftentimes where medicines are in short supply or
    are routinely unavailable. For example, we heard the story of
    lack of the availability of insulin on American Samoa, that
    created a situation where a woman who was pregnant and diabetic
    could not receive the necessary insulin during the time of
    delivery. Specialists in tertiary care are severely limited. In
    Guam, a woman with breast cancer is much more likely to undergo
    a mastectomy as opposed to the possibility of breast conserving
    therapy, such as lumpectomy and radiation. The breadth of the
    treatment options that we have available in this country really
    aren't available to many of the jurisdictions in the Pacific
    Islands.
        Also, the lack of tertiary care generates enormous cost. As
    was just mentioned, many patients who need the attention of a
    specialist must be sent off-island for treatment. This consumes
    a significant share of the health budget.
        As far as the Department of Health and Human Services
    programs, they really are intended to focus in three specific
    areas. The areas of access, the areas of quality of care, and
    also to help educate and inform individuals on how to take
    charge of their health and what are the things they can do to
    improve their health, such as exercising and eating the proper
    diet.
        The Medicare and Children's Health Insurance Programs run
    through CMS work closely with the three territories to assure
    the provision of high quality health care and provide
    significant funding for pregnant women, families with children
    and people with disabilities. In fiscal year 2003, the Pacific
    Island Territories received through Medicaid $2.3 million and
    through the Children's Health Insurance Program $1.9 million.
    The Centers for Medicare and Medicaid Services, as well as the
    San Francisco regional office staff of the Department of Health
    and Human Services provides ongoing technical assistance to the
    territories, especially on eligibility, services and billing.
    And recently there were discussions around such priority areas
    as the provision of screening services, off-island referrals
    and the federally qualified health centers.
        The community health center program funded through HRSA's
    Bureau of Primary Health Care has established health centers in
    Guam and American Samoa. The community health centers
    experience incredible challenges in the recruitment and
    retention of providers, especially ones who come from or are
    knowledgeable of these communities. Qualified nurses are
    frequently recruited to higher paying jobs in Hawaii, as well
    as other States. And Mr. Chairman, as you know, even with the
    continental United States, we are currently under an incredible
    shortage of qualified nurses for our health care system.
        To meet these particular challenges, there has been a
    utilization of non-physician medical officers on the islands
    that are utilized for the provision of health care services,
    instead of fully licensed physicians. Many of the doctors who
    have come to the islands have come through the National Service
    Corps, which is a program funded through HRSA.
        One of the particularly innovative programs that the
    Department has in the Pacific Islands is its Special
    Populations Network for Cancer Awareness Research and Training.
    This is administered by the National Cancer Institute Center to
    Reduce Cancer Health Disparities in the National Institutes for
    Health. The goal is really to build the relationships between
    large research institutions and community based programs to
    address the burden of cancer in minority communities.
        A particular part of this is the Pacific Island Cancer
    Initiative, which has assembled a team to articulate the health
    needs of indigenous Pacific Islanders, and to focus on
    strengthening and sustaining community capacity and increased
    involvement of Pacific Islanders in the National Cancer
    Institute Program and Services is also envisioned.
        The community health centers, through their National
    Diabetes Collaboratives, as you mentioned, diabetes is just an
    incredible problem of the population in the Pacific
    Territories, in Guam, approximately 40 percent of the patients
    have a hemoglobin A1C with an average of 10, far above the goal
    of 7. And as a participant in the diabetes collaborates Pacific
    West clusters, clinicians in Guam have made a commitment to
    improving the quality of diabetes care. In addition to intense
    training on the elements of quality treatment, assistance is
    provided in communication and maintaining registers, which is
    important in tracking the development of complications.
        The last program I want to mention just very briefly is the
    State based diabetes prevention and control program. Again,
    designed to really talk about the ways to prevent the
    development of the illness by proper care, proper diet and
    proper exercise.
        In conclusion, I hope this brief overview of the
    Department's activities has been helpful to the committee in
    considering ways to improve the health care to the Pacific
    Islands. The task is considerable. But it is doable, and we
    must accomplish this. If we are willing to accommodate the
    unique aspects of the region, work with the territory leaders
    and residents in their culture and traditions while respecting
    the governing entities and policies, I believe that we can find
    solutions that will strengthen the capacity of the health care
    system and in turn the health status of the people of the
    Pacific Islands.
        Thank you for the opportunity to testify before you today.
        [The prepared statement of Dr. Stinson follows:]
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        Mr. Burton. Let me start the questioning by asking you, Dr.
    Stinson, how do the health agencies decide how much money goes
    to those territories out there in the Pacific? Is there a
    formula that they use, or do you know?
        Dr. Stinson. I'm not aware of there being any particular
    formula, or some type of quota, as it decides on how to utilize
    the resources that will go to the Pacific Island Territories,
    as well as other parts of the other funded programs throughout
    the Nation as a whole. The general tendency really has been to
    try to look at the development of specific programs, what would
    be the appropriate cost of those interventions as well as how
    you can buildupon the existing infrastructure and work with
    other partners to help in some of those programmatic aspects.
        Mr. Burton. Well, I hope today, this hearing will convey
    that back to our health agencies and maybe my colleagues and I
    can write a joint letter to the Secretary of Health and Human
    Services, our concern about the lack of resources out there.
    When you go out there and you see first and people stacked up
    in the halls to get dialysis treatment, and they're running
    those dialysis machines 24 hours a day, people are coming in
    the middle of the night, because they don't have the capability
    to take care of all of them, it's almost unconscionable.
        I was not aware until today that they are second class
    citizens, American citizens, second class citizens as far as
    Medicare and Medicaid is concerned, as far as the moneys that
    are available to them to take care of their health care needs.
    And our health agency, you know, HHS gets billions and billions
    of dollars. It's one of the largest appropriations of any
    agency of Government. I think it is the largest. We need to
    make sure that American citizens, not only here in the United
    States, but in the territories around the world where we have
    American citizens, get the same quality of care or as close as
    possible to it as they're getting here in the United States.
        Secretary Cohen, is there anything you think we ought to be
    doing that we're not doing that could help get additional
    resources and funding over there for the territories?
        Mr. Cohen. I guess I can only speak for my own department.
        Mr. Burton. Well, but you can go on beyond that if you want
    to, because you've seen first hand the facilities over there,
    and you've been with me at some of them.
        Mr. Cohen. Sure. And Mr. Chairman, I very much concur with
    the observations that you've made in terms of the lack of
    resources for health care in the Pacific. I'm sure we're going
    to hear a lot more about that today.
        One thing that we would like to initiate from the
    Interagency Group on Insular Areas, and that is an interagency
    group re-established by Executive order by President Bush in
    May to have all the agencies of the Federal Government come
    together to coordinate policy of the executive branch toward
    the insular areas, that's the four flag territories other than
    Puerto Rico, is to have a working sub-group so that HHS,
    Interior and others that might have something to contribute to
    this discussion can, No. 1, see if we can get better
    information or create better information on the health care
    needs of the territories, get a fuller picture of what the
    situation is building on some of this anecdotal evidence, and
    trying to get hard data, which is desperately needed, and then
    perhaps talk about solutions to these problems.
        But step one has to be getting better data. Of course, we
    don't need better data to see people stacked up in the
    hallways, or as the Governor of American Samoa will tell you
    about the sorry condition of the hospital there, and its
    propensity to be flooded, the over-use of dialysis machines and
    the lack of trained medical personnel, the difficulty of
    attracting proper medical personnel, both for financial reasons
    and getting people to remote islands.
        So all of these problems are things that I think we would
    like to get a better handle on, on the magnitude of them, and
    then talk to the various agencies to see if there are ways to
    work together to improve the effectiveness of the Federal
    resources that are brought out there.
        Mr. Burton. I hope that working group will, and I'm sure
    you will be working with the health officials on the islands to
    make a recommendation to the administration and our health
    agencies to increase the funding. Because I thought it was
    deplorable, the situation over there. When you go through those
    hospitals and you see the problems that they have, it's just
    heart wringing in many cases.
        I'd like to ask you one more question on another subject
    before my time runs out. There are about 30,000 citizens of
    Asian countries that are in the CNMI. Can you tell us how
    that's affecting the economic problems over there, and the
    unemployment?
        Mr. Cohen. Well, it's very complicated situation in the
    CNMI, because a lot of industries are almost entirely staffed,
    as you and I saw together, by the guest workers. So to the
    extent that guest workers are brought in, generally there is a
    need for them, and they are taking jobs that the locals,
    because of the lower pay rates for these jobs, may not be
    willing to take.
        But it certainly does create an added burden on the health
    infrastructure, as well as other infrastructures in the CNMI.
    And certainly the volume of foreign workers is something that
    has been very difficult for the health care infrastructure in
    Saipan and the rest of the CNMI to adjust to.
        And also the different nature, different types of diseases
    that may be brought in, there are health checks that are done
    in connection with granting entry permits. But still, the large
    migration of foreign workers does increase, it's widely
    believed that it does increase the propensity of certain
    diseases to show up in the CNMI, more than would be the case
    otherwise.
        Mr. Burton. The working group is working on that as well.
    Yes.
        Ms. Watson, you didn't make an opening statement, so if
    you'd like to make an opening statement, that will be fine.
        Ms. Watson. I want to thank you, Mr. Chairman, and I want
    to welcome Secretary Cohen and Dr. Stinson. It's good to see
    you both.
        I want to thank you, Mr. Chairman, and tell you how pleased
    I am that you have traveled to the Pacific Island Territories
    of Guam and the Commonwealth of the Northern Mariana Islands.
    It's really good when you have a first hand look yourself in
    this area. I was so honored to serve as the U.S. Ambassador to
    the Federal States of Micronesia.
        I would also like to thank my colleagues, Representative
    Faleomavaega of Samoa and Representative Bordallo of Guam, for
    being here at the hearing and contributing to the hearing, and
    their leadership in the Pacific Island Territories. As well,
    I'd like to welcome the Governors of Guam and the CNMI and
    American Samoa, and I appreciate your coming this distance to
    be here today.
        As Americans, we should be aware of all the United States
    Territories, Guam, the Commonwealth of Northern Mariana
    Islands, American Samoa, Puerto Rico and the Virgin Islands. In
    addition, the United States has a very special compact with the
    Freely Associated States of Micronesia, the Marshall Islands
    and Palau. Due to the geographic distance from the continental
    United States, some aspects of our social responsibility seem
    to fall through the cracks. The territories and the Freely
    Associated States are really out of our sight, but they should
    not be out of mind.
        As Americans, we take pride in our diversity. And it is our
    greatest achievement that based upon that diversity, whether it
    is economic, political, or cultural diversity, we have built a
    Nation that is dedicated to providing equal opportunity for
    all. But much needs to be done before we can say that we have
    accomplished that goal, most notably in the field of health
    care. Racial, ethnic and geographic minorities too often are
    denied the high quality care that most Americans receive.
        The Federal Government has recognized this serious problem
    and has set a goal of eliminating national health disparities
    by the end of the decade. House and Senate Congress Members
    have introduced legislation, the Health Care Equality and
    Accountability Act of 2003, that takes an important step toward
    making this goal a reality.
        We may have the finest health care system in the world, but
    too many of our people receive too little health care and are
    denied the right to lead full lives. The reality is that the
    health care needs of minority Americans are often greater than
    those of white Americans. The populations of the U.S.
    Territories are eligible for Federal assistance and suffer from
    similar situations to minorities in the continental United
    States of America.
        Minority populations disproportionately suffer from many
    varied diseases. Minority groups have greater rates of acute
    conditions, i.e,. tuberculosis and HIV/AIDS, chronic diseases
    such as diabetes, heart disease and stroke and many forms of
    cancer. In addition, minority women are at a greater risk than
    White women for pregnancy related complications and their
    babies are at higher risk of dying during their first year of
    life.
        Despite a substantial need for health care, minority groups
    often encounter obstacles in obtaining health care. Minority
    groups are less likely to have health insurance and less likely
    to receive appropriate health care services.
        So the testimony today will provide us with information on
    the territories that can be contrasted with trends across this
    Nation. According to a study by the Kaiser Family Foundation in
    June 2003, minority populations have substantially higher
    uninsured rates than white Americans, 12 percent. Hispanics are
    at 35 percent, Native Americans around 27 percent, and African
    Americans 20 percent, while Asian and Pacific Islanders are
    somewhere around 19 percent.
        In addition, while racial and ethnic minorities represent
    only one-third of the non-elderly U.S. population, they
    represent more than half of uninsured Americans. These numbers
    are exacerbated in the islands.
        So Mr. Chairman, our focus today on the Pacific Island
    Territories is a necessary focus. And I'm looking for the
    testimony from the Governors of the three Pacific Territories,
    and from the Pacific Island Health Officers Association, which
    can provide us a picture of the Freely Associated States.
        I commend the vision of this subcommittee and the
    dedication of this Chair to address and investigate these
    health care disparities. The people sitting up here in front of
    you are the dedicated and committed ones, to see that not only
    our citizens but those of you in our territories are not
    victims of being neglected. We, some of us really know the
    problems personally. And you are here to assist in telling your
    story so that we can make the policies that will improve the
    health care of all Americans, either in the continental United
    States or in our territories.
        I yield back the balance of my time, Mr. Chairman, and
    thank you very much.
        Mr. Burton. Thank you, Representative Watson.
        Mr. Faleomavaega.
        Mr. Faleomavaega. Thank you, Mr. Chairman, and I want to
    thank Dr. Stinson and Secretary Cohen for their fine
    statements. I do have a couple of questions I want to raise. I
    think it's important to get a sense of perspective or history
    on the evolution of how insular areas have been treated
    historically by our country, and what has always been the
    traditional Federal agency that has been the chief
    administrator of the needs of these territories, whether it be
    the Pacific or the Caribbean.
        And I make specific reference, of course, to Secretary
    Cohen's responsibility, a tremendous responsibility in
    overseeing the needs of the insular areas. I just wanted to ask
    Mr. Cohen a couple of questions. There's no question that the
    health care needs of the insular areas are different, perhaps
    even worse conditions than many of the areas that we have here
    in the United States. Testimonies have borne out this afternoon
    a reference to distance, sense of isolation from mainstream
    America simply because of our location and difficulty in
    accessibility to services and programs that are easily provided
    or can be provided if necessary here in the continental United
    States.
        As Mr. Cohen had alluded to earlier, we have established an
    interagency, inter-governmental work group, hopefully, to be
    composed of chief policymakers of the various Federal agencies
    that deal with insular areas or with the Pacific Territories.
    In fact, it was just a couple of days ago that we had this
    meeting with Secretary Norton for which we are very grateful,
    that we have some kind of a conduit or a way that we can
    express what our needs are.
        The problem I always have been faced with, this interagency
    working group says it's fine that we talk about the issues, but
    then when it comes to giving some sense of finality or results,
    this is where things get lost in the cracks, and then we go
    back again and we still discuss the very same issues that we've
    been discussing for the past several years.
        It's a tremendous gain on the part of the insular areas,
    we've become more politically developed, we've elected our own
    Governors, we've elected our own congressional delegates. We
    don't have two Senators. And for this very sake that we don't
    have Senate representation, for those of us who represent the
    insular areas, Mr. Chairman, I think we have to work about 10
    times harder. A lot of times it's been with the compassion and
    the interest taken by some, such as yourself, to date to help
    us bring out the issues, not only just for public discussion
    but hopefully to find results.
        As I had mentioned to Secretary Cohen in our meeting with
    the IGIA, and I want to ask Secretary Cohen, will the
    Department of Interior be willing to work with us as
    congressional delegates in crafting appropriate amendments to
    Federal laws that perhaps are not helping us? Because I always
    perceived the Department of the Interior as our partner in
    working, in providing the appropriate forum. Because unless if
    I'm wrong on this, Mr. Secretary, I would like a response.
        Or in each instance, if we have a problem with HHS, we've
    got to go to them. In other words, we end up having to go to
    about 50 or 100 different agencies before we have some sense of
    finality in resolving the problems? I wanted to ask Secretary
    Cohen that.
        Mr. Cohen. Sure, thank you, Congressman. You raise a lot of
    very good and important points. I think your questions,
    especially about the process, now that we have an interagency
    group on insular areas [IGIA], these are very good questions.
    I'd like to share with you some of the optimism I have about
    how the IGIA can address some of the concerns you've raised.
        As you pointed out, the Department of Interior has
    traditionally been the Department within the Federal Government
    that is responsible for the day to day relationship with all
    the territories. But also, all the agencies have independent
    relationships with each of the territories. So there's sort of
    a disparity between our knowledge of the territories, because
    we're the only office, my office, the Office of Insular
    Affairs, is the only office that is focused on the islands 24/
    7. So it's a disparity between that and then the other agencies
    in the Federal Government that often make very large
    investments in the territories, but are not focused on the
    special needs of the territories.
        So it's always been our task, which has been a very
    challenging on, to work with each of the different agencies to
    try to raise the profile of island issues in each territory. To
    do that one agency at a time is very difficult. So one reason
    that I'm very excited about the reestablishment of the IGIA is
    it creates a forum that's mandated by the President of the
    United States for top policy officials, as you pointed out,
    from each of the agencies to come together and focus on the
    particular needs of the insular areas.
        Now, that in and of itself will not result in problems
    being solved, as you correctly pointed out. But it addresses
    the initial threshold problem of getting insular area concerns,
    the particular problems of the islands, on the radar of top
    policymakers in each of the executive branch agencies. That is
    really a major hurdle, because we have found, when people
    become familiar with the disparities, and when they become
    familiar with the particular issues, just as Congressman
    Burton, who took his first trip out with me to Guam and the
    CNMI, they start to have an understanding of, No. 1, the
    uniqueness of the problems, and No. 2, what each agency can
    perhaps do to address it.
        So the process isn't complete in that it won't result, it
    will not guarantee that all of these problems will be solved.
    But we'll guarantee that all the problems will be focused on
    and studied.
        Mr. Faleomavaega. Mr. Secretary, my time is running out,
    I'm sorry. I just want to cite a classic example. When the
    Northern Marianas established this covenant relationship with
    the United States, one of the most unique features of this
    covenant relationship, Mr. Chairman, and thanks to a gentleman
    that I'm sure all the insular leaders are well aware of his
    contributions, for the tremendous help that he gave, was that
    the Northern Mariana Islands became beneficiary to the SSI
    benefits, simply because the late Congressman Phil Burton was
    very much a key player in working that covenant relationship,
    for which NMI, God bless them, are beneficiaries to the SSI
    programs.
        But American Samoa does not get SSI benefits, Guam does not
    get SSI benefits. And every time we've made an effort, and
    Puerto Rico does not get SSI benefits. And I only use it in the
    sense of endearment, you've got a 900 pound gorilla with 3.8
    million Americans living in Puerto Rico. Every time they put us
    together with Puerto Rico, we are dead on the spot.
        So for years we've been trying to work out, how can these
    small, little insular areas, let's just not discuss Puerto
    Rico, where we have tried every way to include American Samoa
    and Guam for SSI benefits, but it's an impossibility. And for
    some reason or another, we say that they're not Americans. I
    suppose I can qualify that, we're U.S. nationals, we're not
    U.S. citizens. But we do fight and die in our wars, I suppose
    that might be a consolation, in our contributions to our
    national defense.
        But this has been the problem. And I'd like to ask
    Secretary Stinson, I've introduced legislation to give the
    Secretary of HHS discretionary authority that they can work in
    MOU relationship between Guam and American Samoa, so that in
    our own unique way, with 150,000 in Guam and 60,000 in American
    Samoa, we're not asking for the moon. Just enough so that it's
    practical and the services, and we need critically, for
    example, SSI benefits for many of our mothers or our residents
    that have this critical need.
        And God bless NMI, thanks to Phil Burton, they got the
    benefit, but we don't. And this is why I wanted to ask Dr.
    Stinson and Secretary Cohen, will you be willing to help us if
    we introduce legislation, even if just to give the Secretary of
    HHS discretionary authority to give us some of that benefit?
        I'm sorry, Mr. Chairman, I know my time's up.
        Mr. Burton. That's OK, we'll let them answer the question
    and we'll go to----
        Dr. Stinson. Yes, but essentially around the specific
    around working with you in relationship to SSI, that's, you
    know, SSI is really part of the Social Security Administration,
    which is not part of HHS any more. There was a time where it
    was part of it, but it did become its own separate agency.
        But I want to answer the bigger question that you really
    posed, and when we look at the needs and what really needs to
    be done to improve the health of the people in the Pacific
    Island Territories, it really does need to be looked at from a
    very, very comprehensive way, and it needs to be looked at
    across the organizational lines of the different agencies.
        To have the type of discussions and the type of engagement
    between Interior, Department of Energy also is a stakeholder
    out there in the Pacific Islands, HHS, Department of Justice.
    To sit down and really determine what are the things, what are
    all the components that adversely affect the likelihood that
    the individuals there can live a long and healthy life, and put
    everything on the table as options and develop some type of
    strategy, some type of plan to do it in a very, very
    comprehensive way. And the Department is very committed to
    doing that.
        Mr. Burton. Let me, before I yield to the delegate from
    Guam, just say that I'd be happy to work with all of my
    colleagues here in drafting a letter, we might have to take
    this one point at time, but to start off with the health issues
    and see if we can't make sure that American citizens and those
    who are from a territory that we control get fair treatment as
    far as health is concerned. That's the thing that bothered me
    the most when I was out there, seeing the deplorable
    conditions.
        With that, we'll go to Delegate Bordallo.
        Ms. Bordallo. Thank you very much, Mr. Chairman.
        We've spent quite a bit of time on discussing the
    processes, so I think I'd like to get to the substance. I'd
    like to ask you, Mr. Cohen, would you agree with me that
    utilization of the Medicaid program to cover Guam's providing
    of health care to citizens of the Freely Associated States who
    travel to Guam would be good public policy worth pursuing? This
    would and should be outside our current cap and with 100
    percent Federal matching assisted percentage. I'd just like to
    get your views on that.
        Mr. Cohen. Sure. As you know, Congresswoman Bordallo, I'm
    here representing the administration and would have to do as I
    always do, work quietly with my colleagues within the
    administration to actually get an official response to very
    specific questions such as that. But the larger point, of
    course, is that we are aware of the problems Guam has had for
    so many years, addressing the medical needs and other needs of
    those who migrate from the Freely Associated States pursuant to
    the compacts of free association.
        When I heard that proposal from your staff, I thought it
    was a very creative proposal. We would certainly work with you
    on a proposal like that. I'm very happy that we've taken what I
    think is a historic major step to addressing compact impact
    issues and now having an annual permanent mandatory
    appropriation of $30 million, of which Guam almost got half
    this year, and I guess maybe for the next 5 years, $14.2
    million, doesn't address the concerns that Guam has raised for
    going back to the beginning of the compact. But hopefully going
    forward, we'll do a much better job of addressing those needs.
        That is one proposal, and you know, we're certainly willing
    to work with you.
        Ms. Bordallo. So would you get back then on that?
        Mr. Cohen. Certainly. And of course, this isn't just
    something that Interior would approve, but it would be an
    administration wide issue.
        Ms. Bordallo. There is one further followup, Mr. Chairman,
    if I could. This is both to Secretary Cohen and Dr. Stinson. I
    would appreciate any comment that you could offer to us on the
    administration's position with respect to the Medicaid caps.
    Any thoughts on how we could best collectively and
    constructively begin to really address this disparity in
    treatment? I'd like to get your opinions. I suppose you're
    going to come back and say that, well, you'll have to check
    with the administration.
        Mr. Cohen. I would just say briefly, just because we've had
    a chance to address this issue through the auspices of the
    IGIA, that I guess HHS, well, HHS is here, so I won't presume
    to speak for HHS. But the issues that were raised in terms of
    linking Puerto Rico to the equation, which increases the costs
    by orders of magnitude, is an issue. And of course at the
    meeting yesterday, some other ideas were tossed out as interim
    solutions.
        But you know, the initial issue of whether caps are lifted
    for all five territories of course presents major cost issues,
    as I understand it, from the administration's standpoint. So if
    there are other creative solutions, it might provide a better
    scope for us to work together to address the problem.
        Ms. Bordallo. Dr. Stinson.
        Dr. Stinson. Yes, first of all, let me say I'm not an
    expert in Medicare and Medicaid. And as we're all aware, the
    provisions of the cap are really grounded in the statutory
    history here, even if there have been some modifications over
    the years. But I would like to say that clearly, the Department
    looks at the services that are provided through the Medicaid
    program as a mechanism of providing access to care. And it's
    certainly interested in the development and the support of
    solutions that will really maximize the ability for all U.S.
    citizens to be able to get the type of care that they need and
    that they deserve.
        Ms. Bordallo. Thank you very much. I'm just, when I was
    listening to my colleague here, Representative Faleomavaega,
    mentioning the SSI and how our neighbors benefit from this, and
    of course Guam, just being a short distance away, we do not
    have this benefit, nor does American Samoa nor Virgin Islands.
    I just wonder if we consider the three of us alone rather than
    bringing in Puerto Rico. They did it with CNMI, so could that
    be looked at, Mr. Secretary?
        Mr. Cohen. I'm sure it could be looked at, and of course,
    it's quite a different issue when it's framed in that way.
        Ms. Bordallo. Thank you.
        Mr. Burton. Well, we'll excuse you, gentlemen, but before
    you go, I hope that you'll stick around to hear what the
    Governors and the health officials have to say from the
    territories that we're going to be discussing. So if you
    wouldn't mind staying around a little bit, I'd really
    appreciate it.
        The one thing that I'd like to stress before you leave the
    table is that although some of the things we've discussed today
    may take legislative action to make positive changes, and
    sometimes that's very difficult, especially with the budgetary
    problems we have, HHS has a lot of money. And HHS has the
    ability to put more money into these territories if they so
    choose. That doesn't require legislative action.
        And I hope that the executives at HHS and your working
    group get together and say, look, we can't have these people in
    American Territories who are American citizens or live in the
    American Territories, we can't have them being second class
    citizens. They at least ought to get quality health care, and
    I'm going to tell you right now, from first hand visual
    evidence, I can tell you they're not getting it. That's just
    not right.
        But with that, thank you very much for your testimony.
        We'll now call to the table the Honorable Governor Camacho
    of the Territory of Guam; the Honorable Governor Babauta of the
    Northern Mariana Islands; and the Honorable Governor Tulafono,
    of the Territory of American Samoa. If my colleagues want to
    make any kind of introductions for these gentlemen, I'd be
    happy to have them do it.
        Mr. Faleomavaega.
        Mr. Faleomavaega. Thank you, Mr. Chairman.
        I want to offer my apologies, we up here on the dais, I got
    so nervous I forgot to even notice my good friend Felix
    Camacho, and I want to apologize. But I do want to thank
    Governor Camacho and Governor Babauta and Governor Togiola for
    the beautiful reception that we recently received, when
    Secretary North and Chairman Pombo and several members of our
    delegation visited these insular areas.
        I would like at this time, Mr. Chairman, to introduce, it's
    my honor to introduce our Governor. This gentleman is a
    homemade product, successful in getting his training as a
    member of the Honolulu police department. He was a law
    enforcement officer. And several years served as judge in our
    territory, and also served as senator and chairman of the
    various committees. He has been practicing law for the past 25
    years, and a graduate of Washburn Law School from Topeka, KS.
    Would you believe, Samoans living in Kansas, Mr. Chairman?
        And due to the untimely death of our late Governor,
    Governor Togiola had to take the reins since last April. Mr.
    Chairman, I'm very, very happy that he's here with us, and I
    look forward to hearing his testimony as it pertains to the
    health care needs of our territories.
        Mr. Burton. Very good. Would any other Members like to
    speak? Ms. Bordallo, do you have any comments?
        Ms. Bordallo. May I introduce my Governor?
        Mr. Burton. Sure.
        Ms. Bordallo. All right, thank you.
        My Governor is Governor Felix Camacho, and there are some
    very interesting twists and turns to his political life. He
    served as the civil service director, I think, correct me if
    I'm not right, Governor, with the Government of Guam for a
    number of years as director. He served many terms and he was my
    colleague in the Guam legislature as a Senator.
        What makes him most unique is that several years ago, his
    father, the late Governor Carlos G. Camacho, served as Guam's
    first elected Governor. And now these many years later, we have
    his son serving in this very high position.
        So Governor Camacho, we welcome you to Washington and we
    look forward to your testimony. Thank you.
        Mr. Faleomavaega. Mr. Chairman, I forgot to mention that
    our Governor has about a five handicap, if you really would
    like to play a round.
        Mr. Burton. I don't want to mess with anybody with a five
    handicap. [Laughter.]
        He would own my house.
        And I'll personally introduce Dr. Babauta, who is a good
    friend of mine. We had an opportunity to get to know each other
    in a more personal way, along with Governor Camacho, when I was
    visiting in that region. So Governor Babauta, welcome to you as
    well.
        Would you please stand so I can swear you in?
        [Witnesses sworn.]
        Mr. Burton. We'll start with you, Governor Camacho, and
    just go right on down the table there. Do you have an opening
    statement you would like to make? You can read your testimony
    or make an opening statement, whichever you would prefer.

     STATEMENTS OF FELIX PEREZ CAMACHO, GOVERNOR OF U.S. TERRITORY
     OF GUAM; JUAN BABAUTA, GOVERNOR, COMMONWEALTH OF THE NORTHERN
      MARIANA ISLANDS, ACCOMPANIED BY DR. JAMES U. HOFSCHNEIDER,
       SECRETARY OF HEALTH; TOGIOLA TULAFONO, GOVERNOR, AMERICAN
     SAMOA; JEFFERSON BENJAMIN, SECRETARY OF HEALTH, DEPARTMENT OF
      HEALTH, EDUCATION, AND SOCIAL AFFAIRS, FEDERATED STATES OF
    MICRONESIA, PACIFIC ISLAND HEALTH OFFICERS ASSOCIATION; AND DR.
        WILLIAM MCMILLAN, ADMINISTRATOR, GUAM MEMORIAL HOSPITAL
                               AUTHORITY

        Governor Camacho. First of all, I would like to thank you
    very much for inviting me and my fellow Governors, the
    territorial Governors, here to Washington to provide testimony.
    We very much appreciate this opportunity, again.
        And the mere fact, Mr. Chairman, that you have personally
    been able to see for yourself the territories with your visit,
    to see first hand the situation of our health care on our
    islands and the many challenges we face. I think it makes a big
    difference. It's not too often that we have Members of Congress
    come out to the far distances in the Pacific to see for
    themselves the many challenges we face. We truly appreciate the
    visit you made there. And with that, I would like to begin my
    testimony.
        Mr. Chairman and members of the committee, Congresswoman
    Bordallo, Congressman Faleomavaega and Congresswoman Watson,
    thank you for inviting me to participate in your hearings on
    the disparities of health care in the Pacific Island
    Territories. I would like to express my appreciation to you for
    providing this opportunity to address the needs and concerns of
    the Pacific Islands on this most important issue.
        Our peoples' health is one of the highest priorities, and
    we are constantly striving to improve the quality of care
    available on the islands. However, in addition to facing many
    of the challenges that States are grappling with, Guam and our
    Pacific Island neighbors also have certain concerns that are
    unique to our region.
        Like many communities, we have difficulty in recruiting and
    retaining health care professionals, and providing basic health
    care in the face of skyrocketing costs and ensuring that every
    member of the public has access to quality health care
    services. But the challenges we face on Guam go far beyond
    these issues. Our small population base, relative isolation and
    constant mix and influx of people from areas with even fewer
    health options are among the many circumstances that contribute
    to the serious health care concerns on Guam.
        With our Department of Public Health and Social Services,
    it provides basic medical care and public assistance to our
    indigent population. The Department is additionally responsible
    for immunizations, health education, disease screening and
    monitoring, tracking the health status of Guam residents and
    safeguarding the vital statistics registry.
        Guam's public health department receives both Federal and
    local funding for indigent care. But Federal caps on Medicaid
    benefits to the island have resulted in the need for the
    government of Guam to bear an unusually large burden for
    indigent care. In fiscal year 2003, Federal funds paid for just
    $8 million of the total Medicaid bill of $15 million. The
    Government of Guam spent an additional $17 million on the
    medically indigent programs that were developed to cover the
    needs of our poor.
        Now, the influx of patients from the Freely Associated
    States [FAS], further burdens our public health system. Public
    health provided more than 188,000 services to residents in
    2003. And of these 24 percent were provided to FAS citizens.
    Citizens from these areas also have exceptionally low rates of
    insurance coverage, 29.4 percent of the FAS citizens surveyed
    in 2003 had no form of health insurance compared to Guam's
    uninsured rate of 21 percent of the adult population. By
    comparison, the uninsured rate for the United States as a whole
    was 14 percent in fiscal year 2002, the last year that U.S.
    statistics are available.
        Now, with an economy still struggling to recover from years
    of typhoons, geopolitical events, economic problems in Asia,
    the Government of Guam simply cannot afford to continue over-
    matching Medicaid. We must have additional funding to provide
    the level of services needed by the population.
        I listened with interest, as you had mentioned, Congressman
    Faleomavaega, about the need to somehow separate Guam and the
    Northern Marianas and American Samoa from Puerto Rico as the
    equation. Because you can combine all our islands, land mass,
    population, even people that come and visit as tourists, and
    still we cannot match the level of population and impact of
    Puerto Rico.
        And it's convenient for policymakers, or those that are
    responsible in administering the programs to say, well, we
    simply can't give it to you in all fairness, because if we do,
    then we must also give it to Puerto Rico. But I think in all
    fairness, we understand the impact of that, but we must be
    given some reasonable exception to the equation and be
    separated out in consideration of Medicaid.
        This lack of funding has also led to serious deficiencies
    in our local facilities which are aging and in need of repair
    or replacement. These facilities have been built decades ago
    with the Hill-Burton funding. And as time has progressed and
    population has grown, our public health department is
    challenged to find adequate space to provide the myriad of
    health services it is mandated to provide.
        In May 2003, a local law was passed requiring clients in
    the medically indigent program to receive their primary health
    care services through the community health services. This was
    done to try and alleviate the impact upon our hospital. My
    administration, with the support of the Guam legislature,
    recognizes our obligation to provide basic primary health care
    services to our people. And because private health care
    providers are currently turning MIP and Medicaid patients away.
    We must identify a point of access for these patients.
        The need for expanding current facilities and acquiring
    additional funding for programs provided by our public health
    and social services department is reflected both in the
    department's difficulties and the health of our population.
    Guam has a high prevalence of both communicable and chronic
    diseases, as you well pointed out, Chairman Burton, which well
    funded and aggressive public programs would best be equipped to
    address.
        Again, you mentioned, Congressman Burton, that our diabetes
    rate for adult population ranges from 25 to 46 percent higher
    than adults in the United States. And while the Pacific Islands
    Health Officers Association meetings in 2003 led to the
    declaration of a war on diabetes, the $200,000 budget for that
    fiscal year seems a small amount to battle a disease that
    conservatively affects more than 10,000 adults on Guam.
        Communicable diseases also remain a major concern because
    of our proximity to Asia, where many new alarming diseases such
    as SARS and the more recent avian influenza outbreak
    originated. Despite our vulnerability to such outbreaks, Asian
    border States and territories were overlooked during a recent
    initiative to increase surveillance in border States for
    bioterrorism agents and emerging infectious diseases.
        With the Guam Memorial Hospital, Guam is served by one
    civilian hospital, which is a fully autonomous entity of the
    government of Guam. As the island's only hospital, GMH is
    mandated to provide treatment to every individual, regardless
    of ability to pay. This has caused serious financial problems
    for the institution, as 80 percent of its patients were
    uninsured self payors, 80 percent of its patients were
    uninsured in the hospital. They were uninsured self payors or
    recipients of medical assistance from the department of public
    health.
        Our hospital provides 1.1 inpatient acute care beds per
    1,000 population, a situation that will deteriorate with 0.92
    beds per 1,000 population by 2010. This is still less than half
    of the 2.1 inpatient beds per 1,000 population in division nine
    hospitals, according to a 2003 American Hospital Association
    report. The hospital's chronic financial problems, combined
    with challenges inherent to a relatively small population base,
    has forced the government of Guam to limit services available
    at the facility.
        However, unlike mainland U.S. patients who can simply drive
    to an appropriate facility, Guam's patients face the expensive
    prospect of flying between 3 to 8 hours to another medical
    center. You mentioned our Speaker, who had to fly off, and many
    thousands of others. The discomfort and cost of such trips, to
    say nothing of the hardship of such a flight on critically ill
    patients, makes access to care extraordinarily difficult for
    many families. Massive family fundraising projects are
    commonplace when a family member needs surgery or cancer
    treatment. And some individuals are unable to get appropriate
    care because of the high cost.
        Honestly, you may have seen it yourself, Mr. Chairman,
    you'd be driving down the highway and you'd find in the medians
    of our highways by the stop lights people with buckets and
    hats, and signs saying, my mother's sick and she needs a kidney
    treatment or open heart surgery, can you donate money. They
    knock on the doors of every politician, asking, can you
    personally help, can you appropriate money. Everywhere you look
    on this island, people have been gravely affected, without the
    ability to pay for medical care.
        The lack of certain services on Guam is perpetuated by the
    need for patients to seek care off-island. More than $30
    million in local insurance premiums each year is spent at
    facilities outside of Guam, robbing our hospital of the capital
    needed to develop and expand services. And to date, GHM per
    capita budget is one-third lower than district nine Pacific
    States, leading to an absence of critical services.
        GMH has no radiation oncology, no cardiac surgery, and
    despite mortality and morbidity rates that significantly exceed
    national averages, we have no kidney donor program or
    transplant service, despite higher than average diabetes rates
    and end-state renal diseases. In addition to the need to expand
    services and make care more affordable for all patients, GMH
    also seeks assistance in Medicare programs.
        A participant since 1986, GMH was granted an exemption from
    the prospective payment system. However, our hospital's
    reimbursement has slipped from cost based to less than cost,
    resulting in the loss of approximately $3 million from Medicare
    revenues of $12 million annually. Critical access hospitals
    receive 101 percent cost reimbursement, and special mechanisms
    are available for disproportionate share hospitals, rural
    referral centers and sole community hospitals. We believe that
    GMH can meet all of the criteria for these special categories,
    if reimbursement regulations can be modified slightly to
    recognize Guam's unique circumstance.
        I just have three other categories, and I'm done. Staffing
    concerns, across the Nation communities have grappled with
    shortages of nurses, medical technologists and other medical
    specialties. This situation is exacerbated on Guam, where it is
    often difficult to recruit and retain health care providers.
        As an example, I would like to share a brief story that
    occurred a few years ago. The island's only gastroenterologist
    decided to return to the U.S. mainland. In the weeks before his
    departure, his clinic was crowded until after 11 p.m., and
    later crowded with other physicians on-island who rushed in for
    checkups and treatments before he left the island.
        With increasing Federal grant funds to Guam, our geographic
    isolation and paucity of human and natural resources contribute
    to a higher cost of doing business on Guam. We believe that
    this cost could be addressed when Federal grants funds are
    allocated to Guam by raising the floor amounts of grants that
    use them, and instituting a minimum floor amount for those that
    do not, and then applying population based formulas for the
    distribution of the remainder of the grant funds.
        In summary, clearly there are a number of issues that need
    to be resolved to place Guam on par with other U.S.
    jurisdictions. And there must be a commitment by the Federal
    Government to help all Pacific Island Territories deal with the
    shortcomings that face each one of us in improving and
    providing the quality health care to our people.
        I thank you for your attention.
        [The prepared statement of Governor Camacho follows:]
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        [GRAPHIC] [TIFF OMITTED] 94494.059

        Mr. Burton. That's a very, very good statement.
        We have two votes on the floor, and I have to run to the
    floor. This is unusual to ask this, but I think I'll ask Mr.
    Faleomavaega if he would to conduct the meeting in my absence.
    I'll be back in about 10 minutes, and then we'll get into
    questions and answers.
        So we'll go to Governor Babauta, we'll go to you next, and
    I'll be right back.
        Mr. Faleomavaega [assuming Chair]. Most unusual situation,
    that the good chairman has been so kind as to allow the
    minority to preside over a hearing. It's unheard of. But I know
    for his graciousness, and Governor Babauta, I know you have
    some very precious statements that you want to share with the
    chairman. I'm sure that the good staff director that we have
    here will take every word of your statement and make sure that
    Chairman Burton gets it.
        By the way, Governor, you've been here long enough to know
    that this is how the Congress and the congressional committees
    operate, and I know it's not lack of sensitivity, it's just the
    reality of the nature of the beast. This is how the Members
    have to be, on the floor to vote. They cannot vote by proxy.
        But please proceed.
        Governor Babauta. Well, you know, years ago I called you
    Mr. Chairman. And although it didn't work out, I can truly call
    you today Mr. Chairman, at least temporarily.
        Just as a way of opening remarks, I sat here thinking, when
    you and Congresswoman Bordallo were introducing your Governors,
    how totally unfair it was that I do not have a delegate up
    there to introduce me as well.
        Mr. Faleomavaega. How great an honor you had, in the fact
    that the chairman was introducing you, and the congressional
    delegates certainly don't have the same rights and privileges.
    [Laughter.]
        I think, Governor, you could not have gotten a better
    person to introduce you, in a much higher capacity than us
    humble congressional delegates. Please don't feel that bad.
        Governor Babauta. Let me get back to you on that point.
        Today, I'm honored to be accompanied by a number of elected
    officials from the CNMI. I want to recognize them by name,
    because I want their names to appear on the record as having
    borne witness to this very important hearing that Chairman
    Burton called for.
        We have the Senate President, Joaquin Adriano, and Senator
    Joseph Mendula, Senator Henry Senicholas, and Senator Tom
    Villagomez, Senator Louie Christastimo, and Congresswoman Janet
    Maratita. Just for the record also, Congresswoman Janet
    Maratita is the only female representative in the entire
    legislature. So we're very proud of her.
        Mr. Faleomavaega. Governor, I know exactly where you're
    coming from. It is annoying at times, when you feel like you're
    not really part of the team, or as a full fledged member. Just
    like when we have roll calls, we're left here, and the others
    get to go vote on the floor. You feel like perhaps you're a
    second class citizen in that respect, but that's just the way
    things are here in Washington. I know that every Member here
    doesn't feel we're being slighted, it's just the fact that as
    territorial delegates, we don't have the full rights and
    privileges allotted to Members who represent the various
    districts from each State. We understand that's just the way
    things are.
        As I had raised earlier the question with Secretary Cohen,
    traditionally the Department of Interior has always been our
    main advocate, I suppose, over the years, with the Federal
    agencies, with the White House, even with the Congress. I
    wanted to pursue that line of questioning, wanted to know if
    there's any disagreement with you in that regard.
        I know Dave is very good in being elusive and not saying
    exactly how he feels about some of these issues. But I was just
    wanting to know what your thoughts are.
        Governor Babauta. Mr. Chairman, I totally agree with you. I
    think legislation is part of the equation in addressing a lot
    of the discrepancies that the insular areas experience. The
    Medicaid, for example, and the equation of Puerto Rico, every
    time we talk about the territories, Puerto Rico having a
    population of about 6 million people, and the costs associated
    with the population of Puerto Rico is just, there's no
    comparison to us smaller ones. I think a special legislation
    would be absolutely in order for that.
        Mr. Faleomavaega. I think Congresswoman has a comment.
        Ms. Bordallo. Yes, thank you, Mr. Chairman.
        I'd like to mention to those in the room that we had two
    Members of Congress who had to leave abruptly, Congresswoman
    Watson, who was here, and I don't know if you noticed the
    gentleman at the end of the table, Congressman Cummings, who is
    the chairman of the Black Caucus. They were just called to an
    emergency meeting because of the situation in Haiti. I'd just
    like to say that they were interested and were present at the
    hearing. Thank you.
        Governor Tulafono. Congressman, if I could add to that
    dialog while we're preserving the time to assure the
    presentation by Governor Babauta there in the presence of the
    Chair, my attitude toward this whole thing is, first, it took a
    visit from the chairman to come to grips with the real
    situation, and with reality that we live with day in and day
    out. I think some of the testimonies that have been offered so
    far do provide some good suggestions. I think one of those
    suggestions is, I think we need to take a comprehensive look at
    these conditions.
        I don't think there's any question, and I will say that in
    my testimony again, that the fact that this hearing is convened
    and the recognition of the disparity is sufficient. For the
    first time in my estimation, we are here to provide some of the
    causes that we know from our respective jurisdictions to try
    and help the committee fashion perhaps some of the legislation,
    or some of the assistance to help us deal with the situation,
    help all of us deal with these situations in our jurisdictions.
        I also feel that as a result of what has come up, I think
    in addition to look at the situation itself, with respect to
    health care, I think also we need to look at the mechanism of
    financing health care in the territories. We have very unique
    situations that require considerations that are not common to
    everybody else. And I think that is sufficient reason to want
    to address those issues in a special way. I think that comes in
    the way of fashioning a financial mechanism or financial
    scheme, so that the issues of the territories are addressed
    specifically.
        Because if we continue to deal with them in a global sense
    across the Nation, they will never be addressed. They can never
    be addressed. And I don't know if there's any way that you can
    fashion anything from the existing schemes of today. But I
    think the fact that this hearing convened, I think it's the
    first time that I am aware of that a problem is identified, and
    we are here just to provide information to help, instead of
    trying to convince Congress that we have a problem. I don't
    think we need to convince Congress any more that there is a
    problem.
        Mr. Faleomavaega. You could not have stated it better,
    Governor. The problem that Madeleine and I have always had over
    the years is to have Members interested in issues relating to
    the territories. This is one of the things we always struggled
    with, is to get as many Members to come to our respective
    districts. Because that is the only way these Members are going
    to have some sense of attention, just as the fact that Chairman
    Burton was able to visit, and I suppose it wasn't just Guam and
    NMI, it was probably part of an overall delegation that he led
    to other areas of the Asia Pacific region.
        But the fact that this caught his attention, this is just
    the nature of how things operate here. I'm just so grateful
    that Chairman Burton has taken this initiative to do this.
        Now, we can make our requests, the fact that finally we're
    able to get the chairman of our House Resources Committee to
    come and visit the insular areas, and the fact that some of
    these Members have never heard of these insular areas, is an
    accomplishment in itself. I don't know how else I could relate
    to the difficulty there is in even getting anybody to come
    down. It's always a problem with Members even here in the
    continental United States to have other Members come and visit
    their districts, it's a very difficult situation.
        So again, our being here, like I said, and thanks to
    Governor Babauta and Governor Camacho for really getting the
    chairman's ear on issues related to health care needs of NMI
    and also Guam and American Samoa has also become a beneficiary
    because of this, and we have a chance to express our feelings
    about these needs. I sincerely hope that as a result of this
    hearing, we're going to come up with some strong
    recommendations, even by way of hopefully maybe even offering
    amendments to current Federal law that will be helpful in
    addressing some of these serious needs that we have as far as
    health care needs are concerned.
        Governor Babauta, I think Chairman Burton should be here in
    another couple of minutes. Maybe you can go ahead and proceed
    in that regard. But save your punch line for him when he's
    here. Does that sound OK?
        Governor Babauta. Sure, that's perfectly fine.
        Mr. Chairman, the names of the elected officials that I
    enumerated, it is good to have somebody other than myself come
    to this hearing to know just how much Chairman Burton means to
    all of us for his visit to the islands. This hearing is truly
    historic, because I have not seen a hearing in Washington held
    specifically on health issues in years that I have been here in
    Washington.
        Years ago, we had the Hill-Burton dispensaries. These were
    dispensaries that were constructed under the federally funded
    program, the Hill-Burton program. So a lot of dispensaries were
    built throughout the CNMI.
        Then came Philip Burton, of course, he singlehandedly gave
    CNMI the Social Security, the Supplemental Security Income. So
    we're grateful for the late Congressman Philip Burton. Then of
    course, Chairman Burton having come out to CNMI and then
    holding this historic hearing, I just want to say to the
    chairman that the people of CNMI are grateful, very grateful to
    individuals with the last name Burton. We are very honored and
    pleased with the chairman's visit to the islands. We appreciate
    his taking the long flight to the islands.
        And when he was there, taking the time to speak with
    individuals, both elected leaders and health officials and our
    ordinary people that he met, he took the time to have
    conversations with them. That was just extraordinary on his
    part.
        The CNMI has been a U.S. commonwealth since 1976. We had
    virtually no health care capacity when we entered the U.S.
    family about a quarter of a century ago. At that time, our main
    hospital facility consisted of an outdated Naval facility, long
    abandoned by the United States. Then in 1982, with the
    assistance of the United States, we developed a new hospital
    facility, that's the Commonwealth Health Center today. That
    facility is now 20 years old, overburdened and in need of
    critical repair, upgrade and expansion. It provides services to
    a much higher population of patients than was ever anticipated.
        In addition, our remote location poses other challenges.
    Our closest U.S. tertiary medical referral center is in Hawaii,
    some 3,000 plus miles away. We have issues regarding the
    adequate provision of health care services to a scattered
    population on three major islands, Rota, Tinian and Saipan. And
    occasionally, we have challenges with health care needs in the
    northern islands. Each island, although rural in nature,
    requires the development of a certain level of emergency and
    preventive and primary health care services.
        Mr. Chairman, we have a diabetes epidemic on our islands.
    The No. 1 health issue facing our commonwealth is the treatment
    of this disease. The prevalence of a CNMI person having
    diabetes is 300 percent more than a person in the 50 States,
    300 percent more. We have children developing Type 2 diabetes,
    and these children will require treatment for the rest of their
    lives. We need $3 million in assistance from this Congress to
    combat and treat this disease.
        Mr. Chairman, the advent of September 11, homeland security
    priorities and the emerging highly infectious diseases such as
    SARS, we have had to cope with upgrading and repair of our
    rapidly aging hospital facility. We need your assistance in
    funding $6 million in air circulation and water treatment
    improvements to the Commonwealth Health Center. We take issue
    with the way the Medicaid funding is provided for the CNMI,
    just as the other territories do.
        We receive millions less in Medicaid reimbursement than we
    would if regular State funding formulas were applied. This
    situation results in the CNMI being less able than the States
    to meet the health care needs of our people, again burdening
    not just the way we deliver health care, but our capability in
    terms of cost. We want the same Medicaid funding as States
    enjoy, and we ask, I ask this committee to end this funding
    discrepancy.
        We also are faced with the fact that many patients with
    complicated medical problems, such as cardiovascular diseases,
    must be referred off-island for definitive diagnostic and
    therapeutic services. We transport patients to Hawaii and other
    distant locations at increasing costs. Patients being referred
    off-island consume a significant portion of our health care
    budget. And with the help of Congress, we can reduce the cost
    of health care, and we can do this by developing a truly
    reasonable health care delivery system. We can do it by
    improving our capacity and with the blessing, with my good
    Governor from Guam, we can make Guam a reasonable health care
    center for the region.
        I ask for this committee's support in developing this
    regional health care program for the people of the CNMI and for
    the people of the region.
        Thank you, Mr. Chairman. I am accompanied today by the
    Secretary of Health, Dr. Hofschneider, to answer any specific
    and detailed questions that you may have. Thank you.
        [The prepared statement of Governor Babauta follows:]
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        Mr. Faleomavaega. Thank you, Governor.
        Governor Togiola.
        Governor Tulafono. Thank you, Mr. Chairman.
        Before I go on, I would like to thank you, sir, for that
    great introduction, and for conveying a handicap that I can't
    very well live up to. I just wish that number could be
    translated to some kind of a formula for obtaining funding to
    build a new hospital for American Samoa. I would just be right
    out of here. [Laughter.]
        Talofa to the Honorable Chair Burton and to the temporary
    chair, our own Congressman from American Samoa, the Honorable
    Faleomavaega. Thank you.
        I would also like to especially greet the Honorable
    Congresswoman Bordallo. It's been a pleasure serving with you
    as lieutenant Governors in the NCLG. And I'm very happy to see
    you in that chair.
        I am very honored to be here, and I would like to thank
    Chairman Burton for the opportunity and the honor to testify in
    this hearing on the issue of health care disparities from a
    U.S. Pacific Island territory, in this case American Samoa. The
    health care and medical issues faced by small islands such as
    American Samoa are insurmountable, due to our isolation and
    remoteness from specialized services unavailable on-island,
    retention and recruitment of medical staff and overburdened and
    outdated medical facilities.
        In addition, our dollars just aren't worth a dollar any
    more, especially in a remote location. And also, due to the
    very low percentage of Federal assistance dollars per capita
    that we receive in direct assistance.
        Mr. Chairman, I sincerely thank you for your humanity and
    initiative. If nothing else, the preamble to this hearing
    really is the recognition of the problem we face. There is a
    serious disparity in health care in these U.S. Territories in
    the Pacific. I would like to state for the record that in the
    treaties of cession involving the islands of American Samoa, to
    take care of the welfare of the people is a promised
    recognition that is enshrined in those documents. It's sad to
    say that it's very difficult for us to deliver and take care of
    that welfare when we cannot deliver appropriate medical and
    health care services to the people of American Samoa in an
    adequate way.
        It's always a struggle to meet the rising costs of health
    care in American Samoa. Our only hospital, the Lyndon Baines
    Johnson Tropical Medical Center, is 40 years old. It has been
    upgraded and expanded over the years, but it falls short of
    meeting the health care needs of our territory. It is one of
    the best facilities in the South Pacific region. However, it
    falls short in standards compared to health care in Hawaii and
    the mainland.
        Just May of last year, in 2003, during torrential rain, the
    whole facility was covered with mud, even including the patient
    wards. The cleanup was done around the patient beds while the
    patients were sitting on the bed, to try and remove the mud
    from the facility. We have unique problems that will require
    unique solutions to overcome. And I thank you for this hearing.
    I believe the recognition that is given to the problem gives us
    a little easier task today. That is not to come here to
    convince you that we have a problem; rather, we've been invited
    to try and help you recognize why there is a problem and try to
    help foster and forge solutions that will be beneficial to the
    U.S. Pacific Territories.
        The first of those issues I want to bring up to you is, our
    own natural environment, being a tropical climate increases the
    risk of diseases subject to natural disasters, as evidenced by
    recent flooding, mud slides and cyclone Heta in January, and in
    a very hard to reach island location.
        Second, our health care system is plagued by understaffed
    agencies, and a portion of staff is underskilled or
    inadequately trained to perform up to acceptable standards.
    Three, even our trained staff to maintain adequate care levels
    is difficult to attract, even at high salary levels, due to our
    isolated location and limited facilities. A classic example of
    that is, we offered recently $150,000 compensation package to
    hire a nephrologist. No one is interested. Nobody is
    responding.
        No. 4, the health care system is not adequately meeting the
    needs of the public, because the health care work force is not
    sufficiently trained to deliver high quality service. As
    identified by Dr. Stinson, we're constantly relying on medical
    officers to work as doctors, which they're not qualified to
    deliver. But that's the limit of the ability that we have.
        No. 5, medical equipment purchases and maintenance costs
    and pharmaceutical supplies are high, and have risen
    significantly during the last decade. No. 6, funding from local
    fees and Federal resources is continuing not to be sufficient
    to meet operational needs for a sound health care system. And
    efforts to bring in a reasonable health insurance program have
    failed due to low patient volumes and unreasonable offers from
    insurance providers. We put out an offer last year, and only
    one company responded, offering us a premium of $18 million a
    year, which is almost more than our whole health care system.
        No. 7, an underlying issue is our high growth rate also in
    American Samoa, which leads to increasing demands that will
    outstrip existing and planned improvements to health
    facilities. Last, due to limited tertiary care on-island, there
    is an unacceptably large proportion of health care dollars from
    the territory's budget absorbed by off-island medical care
    referral cases, especially to the State of Hawaii medical
    centers.
        The great percentage of total health dollars are spent on
    tertiary care overseas, and too small a sum is spent on
    preventive health programs and services in American Samoa. What
    are some of the causes of these disparities? It could be summed
    up quickly by saying that rapid population growth and changes
    in migration patterns has led to an escalation of immigrant
    families with greater health needs coming into American Samoa.
    That's document in our population report of the year 2000.
    Population growth and increased service demand has resulted in
    insufficient resources to meet public demands.
        The ever-increasing cost of health care due to inflation
    and the emergence of new technologies and equipment to support
    them are pushing the LBJ Tropical Medical Center past the point
    of being able to support its essential medical services for the
    community. A question arises whether improved health services
    encourages this immigration, thus helping to cause the stress
    on facilities and services. Also, we have improved our health
    and family planning education programs and services. But with
    our high end migration pattern, do these programs reach the
    people causing high birth rates and result in decline?
        A portion of the users of hospital services have limited
    funds, and are not able to pay increased fees to support
    improved health care. Is our responsibility to continue to
    provide health services, even if clients are unable to pay
    fees? And if we do so, how do we pay that cost? Only limited
    local revenue exists to expand our health facilities, and the
    territory is increasingly becoming dependent on limited Federal
    expenditures, such as funds from DOI, CBDG grants, and the CIP
    program.
        In 1996 to 2000, the expenditure was $40 million, or $8
    million per year. Presently, we receive $12 million for health
    care, $10 million from DOI and $3 million from Medicaid.
    Medicare provides at a one to one ratio to the mainland, even
    though the costs are much higher in American Samoa. The reality
    is that our government collects much less than it expends, and
    we face a serious dilemma on how to finance our needed service
    providers, and an expanded infrastructure to support our health
    delivery system.
        The lack of health and medical insurance in American Samoa
    further compounds our financial dilemmas in operating the
    services to the territory. All the respondents to our last
    offer, RFP, came from off-island. There are no insurance
    companies available on the island.
        The current financing method is both socially inequitable
    and unsustainable as the hospital authority can no longer
    support health care to a level that meets public expectations,
    standards of quality and scope of services. If health care
    costs are increased further and the health system continues to
    divert a large proportion of health care dollars for off-island
    tertiary care, the hospital will ultimately have to raise fees
    to the point that low income individuals will find basic health
    services inaccessible and essential health services will become
    eroded due to a lack of funding.
        Our remoteness and expensive, infrequent air service
    between American Samoa and Hawaii also adds to the difficulties
    in medical tertiary care. The passing of our late Governor
    Sunia last year is a case or testament of not having adequate
    tertiary care on-island, limited medical resources and flights
    that could have abated his untimely demise. He was forced to
    catch a flight to a foreign country to catch a flight to try
    and reach Honolulu in time. He passed away enroute.
        To meet the causes of these disparities, we have taken a
    number of actions in American Samoa. However, the reality is
    that it is difficult to provide quality health care in this
    environment, to deal with our natural disasters and overcome
    the attraction of being a U.S. territory to our neighboring
    countries. The late Governor Sunia formed a task force to
    investigate the effects of the rapid population growth we are
    experiencing. This included impacts and ways to overcome these
    problems, including those to our health delivery system. We
    have a committee to address population growth issues through
    implementing the recommendations of that population task force
    report in 2000.
        We need to work with our environment and the climate and
    natural disasters to which we are subjected. I ask you to
    understand that our challenge is greater than in other
    locations, and our needs are also greater. Remember that
    American Samoa represents the United States in this region. It
    is important that we put our best face forward.
        We look for assistance in terms of funding, but it is not
    just about money. We need help to recruit qualified health
    professionals, incentive programs to attack our staffing
    problems, and enable us to attract qualified physicians to come
    and provide the services so needed in the territory. We also
    need to develop and implement a health and medical insurance
    program in American Samoa to subsidize health care in order to
    operate, upgrade and deliver top health care to our residents.
        Finally, I cannot also negate the need to reevaluate and
    assess the current facilities if the capacity and staffing
    issues are resolved for much needed upgrades to medical
    buildings, technological improvements and to develop high
    tertiary care services to be made available to all residents of
    American Samoa.
        I hope this information will give you a perspective of the
    issues that we confront in American Samoa, as other Pacific
    Island Territories. It is my hope that you can assist us in the
    areas I have outlined that continue to plague us in providing
    health care services to all who reside in the territories.
        Thank you for your attention and I appreciate this
    opportunity to be here with the committee and share a
    perspective from a U.S. territory in the South Pacific. Again,
    we thank you for convening this hearing, and thank you for
    having us today.
        [The prepared statement of Governor Tulafono follows:]
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        Mr. Burton [resuming Chair]. Thank you. I want to thank
    Representative Faleomavaega for carrying on while I was gone.
        Let me just ask a few questions, then after they ask their
    questions, we'll go to your medical experts and try to find out
    exactly what in the way of money and other things we can do to
    help solve this problem.
        I'm just curious, Governor Tulafono, what did your
    predecessor die from? You said he died on the airplane.
        Governor Tulafono. Yes, he did. He was being evacuated to
    Honolulu because our hospital could not continue to treat his
    illness.
        Mr. Burton. Was it a heart condition, or cancer?
        Governor Tulafono. Well----
        Mr. Burton. If you'd rather not go into it, that's OK. But
    it was something that could have been treated had they had the
    facilities on the island?
        Governor Tulafono. I think he eventually suffered from a
    heart failure. But it was due to other medical conditions.
        Mr. Burton. And is it pretty certain that had they had the
    proper facilities on the island, he would have been able to
    survive?
        Governor Tulafono. That's correct. If the facilities had
    adequate treatment and physicians competent to treat his
    condition, he would have survived.
        Mr. Burton. That's really a tragic story, chief executive
    of a territory like that not even being able to get adequate
    treatment.
        Governor Camacho, your island had I guess a problem with
    the Guam Memorial Hospital Authority. They had a $20 million
    debt and they had to declare insolvency, I guess. Can you tell
    me a little bit about how that happened, how that occurred?
        Governor Camacho. I have our hospital administrator, Bill
    McMillan.
        Mr. Burton. We can wait until the next panel. I think he's
    going to be testifying, is he not?
        Governor Camacho. Yes, the hospital has not filed for
    bankruptcy.
        Mr. Burton. Oh, that's not true.
        Governor Camacho. They're still financially solvent.
        Mr. Burton. But they're having a tough time right now?
        Governor Camacho. Yes, the government had to step in and
    take money out of our general fund, and I believe even a
    portion of some grant money and money that we had available and
    bailed them out a couple of times for them to even make
    payroll.
        Mr. Burton. Is that right. The request that I presume
    you're going to be making, along with the other territories,
    will talk about how that can be dealt with?
        Governor Camacho. Yes, sir.
        Mr. Burton. I think you said, Governor Camacho, that over
    24 percent of the 188,000 medical services were rendered to
    patients from the Freely Associated States who are not American
    citizens or nationals. How do you compensate, how do you take
    care of those expenses?
        Governor Camacho. That's a very good question, Mr.
    Chairman. Basically it has to be absorbed by our medically
    indigent program. In fact, the amount of money owed to the
    hospital for uninsured services provided to our citizens and
    also others from other countries is absorbed by the general
    fund. Part of the problem or reason why they have not been able
    to make payroll or come close to not making payroll or paying
    their obligations, it's a burden that's been absorbed by the
    hospital and public health. And certainly it is a growing
    problem.
        We have, because it's only one civilian hospital, there is
    a responsibility we have to accept all patients, no matter
    what. And the funding and the payment for their care and
    services leaves a big dent and big hole in the hospital's
    finances. Their accounts receivable amount has been tremendous,
    and I give a lot of credit to our board and Mr. McMillan in his
    administration of the hospital. They've made great strides in
    running it as it should be run.
        But there are some problems that simply cannot be overcome.
    How do you tell a person, sorry, we can't provide services for
    you because you have no insurance or you have no way of paying
    for it. We simply take them in and somehow or other we will
    eventually try and find payment out of the general fund. But we
    have a growing problem under what's called the medically
    indigent program. Again, government and policymakers come
    forward with every good intention to provide for the needy and
    those that cannot afford medical care or medical insurance. And
    somehow or other, it's the government that has to bear that
    cost.
        Mr. Burton. And the Medicaid ceilings there are below what
    they are on the mainland?
        Governor Camacho. Definitely. Much, much lower. We have a
    cap and we continue to pay over and above. We've spent an
    additional $17 million just on the indigent care program, for
    those that don't have any insurance.
        Mr. Burton. Let me ask one more question to Governor
    Babauta. That diabetes Type 2, I think you alluded to that in
    your statement. I wasn't here, but I think I read that in your
    statement. Did you refer to that?
        Mr. Babauta. Yes, Mr. Chairman.
        Mr. Burton. What I wanted to find out, CNMI is third in the
    world among populations with that kind of diabetes, it's one of
    the worst places in the world as far as that's concerned, and
    what exactly do you need to compensate for that or deal with
    that?
        Governor Babauta. We definitely need to complete the
    extension of the hospital that is now under construction,
    adding additional 27 units for dialysis to treat the
    overflowing dialysis center that we now have, and making sure
    that the entire extension of the new hospital is well equipped
    with air circulation suitable for patients that are critically
    ill.
        Mr. Burton. And the total cost of that would be about how
    much?
        Governor Babauta. We're looking at a total cost of about
    $12 million, Mr. Chairman, all in all.
        Mr. Burton. That would be a one time cost for the expansion
    and taking care of the air handling and everything else?
        Governor Babauta. Yes, sir.
        Mr. Burton. Mr. Faleomavaega.
        Mr. Faleomavaega. Mr. Chairman, listening to the statements
    from our Governors, I think there is a common thread here in
    terms of the health care issues that we have, sharing together
    with the territories. I think diabetes, hypertension, and
    obesity are probably among the three or four top killers as far
    as the health care situation that we have. I can certainly
    speak on behalf of American Samoa, we have the same situation.
        And I don't have any questions for the Governors, except I
    want to commend them for their statements. As I've said
    earlier, Mr. Chairman, the issues and the problems are out
    there. And as you have expressed an interest in saying, funding
    is critically needed to provide for these, to take care of the
    problems that we have, and hopefully somewhere, somehow, we
    might be able to provide some assistance in that regard.
        Again, I want to thank our Governors for their fine
    statements and being here with us this afternoon to share their
    statements. Thank you.
        Mr. Burton. Ms. Bordallo.
        Ms. Bordallo. Thank you, Mr. Chairman.
        I too would like to thank the three Governors for their
    testimonies, and as I listened intently to each of the
    problems, it just seems so bleak. Certainly we in Congress will
    have to address this.
        I want to mention, there's someone in the audience, I
    think, who hasn't been introduced. That's Ambassador Jesse
    Marholou from FSM. He's been sitting through the entire
    afternoon. Ambassador, welcome to the hearing.
        Mr. Chairman, I just for the record want to mention that
    since we've heard all the problems, what are we doing. Well,
    there is some legislation that's been sponsored and is moving
    through the process here in Congress. One is H.R. 675, that's a
    bill that was introduced by Congresswoman Christensen and co-
    sponsored by Eni and myself. The territories are all in this
    together. That has to do with lifting the Medicaid cap. That's
    H.R. 675.
        Then we have H.R. 3459, it's called the Health Care
    Equality and Accountability Act. This was introduced by the
    gentleman that came for a moment but was called away,
    Congressman Cummings, and co-sponsored by the members of three
    minority caucuses. That addresses health disparities of our
    minority population, which includes specifically the Medicaid
    caps for the territories.
        Then the third one is H.R. 3750, that's the Pacific Insular
    Areas Rural Telemedicine Act that I recently introduced, which
    is also sponsored by our sister territory, which would enable
    the Pacific Territories greater access to funding for telehelp
    and telemedicine applications. So I just want you to know that
    there is some movement now, but certainly it's just the
    beginning, it's the tip of the iceberg. We've got to continue
    to work very hard.
        And Mr. Chairman, I was hoping that maybe when we see these
    bills move through, that your support of them would certainly
    be helpful as they move along in the process. And of course,
    anything else that we can develop after this public hearing.
        Again, thank you to the three Governors, all very good
    friends of mine and it's nice to see you. Welcome to
    Washington. I know you're anxious to get home to warmer
    weather. Thank you.
        Mr. Burton. Thank you. Let me just say that I'll sure take
    a look at the legislation to see if I can be of help. During a
    time of severe budgetary problems like we're facing in the
    Congress, getting new legislation passed that is going to have
    a price tag attached can be rather difficult.
        What I would like to see, and maybe with all of us working
    together we can get it accomplished, is to talk to Health and
    Human Services initially and get them to get off the dime and
    appropriate the moneys that are necessary for the immediate
    problems, expansion of the hospitals, the dialysis treatment
    centers, and whatever else is needed, so that we can make sure
    that the quality of health care is improved very quickly. Then
    as far as the legislative proposals are concerned, we'll work
    on those as well.
        Ms. Bordallo. Thank you.
        Mr. Burton. So with that, Governor, did you have one more
    comment you wanted to make?
        Governor Camacho. Yes, I wanted to thank you, Mr. Chairman,
    and Congressman. As I listened to all our problems again, there
    are many common themes. In talking to Governor Babauta and
    talking to President Tommy Remegasal, Governor Oraecho from
    Yap, Peter Christian and also president from FSM, we all agree
    that we're trying to find ways, we understand as leaders that
    we're problem solvers. We're trying to find solutions and find
    ways to make things happen.
        So we have agreed that one approach we're taking is to try
    and work and help each other together as a region in the
    western Pacific, with the limited resources we have, we're
    going to find ways to help each other out, one way or the
    other. We have pride, we have dignity of our people.
        As we come to you, and as we come to Congress, it's with
    the idea that we're not necessarily blaming anyone, we're
    simply here, as my colleague Governor Tulafono had mentioned,
    we're here to express that yes, we do recognize the problems,
    but we're also trying to find solutions and help you in that
    way. From our perspective, we can point out the key areas where
    we definitely need the help and how you can help in
    legislation, working together we can resolve a lot of things.
        But we do have our pride, we do have our dignity. And
    working together as a region, we're going to make things
    happen. So we're doing everything we can on our end. We do need
    a little help from this end, too.
        Mr. Burton. We really appreciate that attitude. But I have
    to tell you that every State in the Union, every city in the
    Union, they come here on a regular basis with problems that
    need to be addressed to help their constituencies. It's not out
    of line for you to ask for fair treatment as well, any of you.
    So I think it's imperative that we do what we can while you're
    doing what you can to help make this thing work better.
        Let me now have the next panel come forward. I want to
    excuse this panel, thank you very much for your testimony.
    We'll have the Honorable Jefferson Benjamin, M.D., the
    Secretary of Health for the Department of Health and Education
    and Social Affairs for the Federated States of Micronesia. He's
    speaking for the Pacific Island Health Officers Association. I
    guess he's going to be the spokesman.
        But I'd also like to have Dr. Stevenson Kuartei, public
    health officer, Palau, come forward; Dr. William McMillan,
    who's the administrator of the Guam Memorial Hospital
    Authority; and Dr. James Hofschneider, Secretary of Health for
    CNMI, who's with Governor Babauta.
        Mr. Faleomavaega. Mr. Chairman, I have to go with my
    Governor right now, but I will come right back.
        Mr. Burton. Oh, sure. We'll receive his testimony.
        Gentlemen, will you raise your right hand? I'd like to have
    you sworn before answering questions.
        [Witnesses sworn.]
        Mr. Burton. Be seated.
        Since you're the spokesman, Dr. Benjamin, we'll let you
    give the overview, and then we'll go to questions.
        Dr. Benjamin. Thank you very much, Mr. Chairman. My name of
    course is Jeff Benjamin. And of course with me are Dr.
    Hofschneider, Dr. Kuartei, members of the PIHOA. We are Pacific
    Islanders who live in the Pacific and are here on behalf of the
    Pacific Island Health Officers Association.
        PIHOA is the association of the ministers, secretaries and
    directors of health for the U.S. Pacific Island jurisdiction,
    which includes Guam, American Samoa Commonwealth of the
    Northern Mariana Islands, Federated States of Micronesia,
    Republic of the Marshall Islands and the Republic of Palau. I
    want to thank you for this opportunity to tell the Pacific
    story.
        The U.S. Pacific insular areas are unique because of the
    challenges posed by the fast and isolated geographical setting,
    an area of the Pacific the size of the continental United
    States. At least nine distinct ethnic cultures, with varied
    socioeconomic and political conditions. A population of about
    half a million people, scattered over five time zones.
        Most of the things discussed are health indicators that are
    associated with health disparities in the region such as the
    rate of people living on the poverty line, which ranges from 25
    percent in Guam to as high as 91 percent in the FSA. Infant
    mortality rate, some as high as 37 per 1,000 compared to 6.8
    per 1,000 in the United States. Life expectancy is about 7
    years lower than in the United States, and in some areas, the
    difference is 10 years or more.
        All of the U.S. associated Pacific island jurisdictions are
    going through a state of transition, health morbidity and
    mortality. We stand in double jeopardy, having to do with
    illness of antiquity, such as leprosy and elephantiasis, as
    well as having to deal with issues of modernity, diabetes,
    heart disease, stroke and others. With globalization, our
    borders can no longer protect us from SARS, avian influenza and
    the ever-present threat of terrorism and global warming.
        These islands are also vulnerable to natural disasters.
    Because many of them are located along the Pacific Ring of Fire
    and the Pacific typhoon belt, which predisposes them to
    earthquake and typhoons.
        I am told that the U.S. Pacific Island jurisdictions score
    up to a maximum of 25 on the health professional shortage area
    score, something we are not proud of. This shortage is
    significant because the access to health is not only dictated
    by remote geography and limited financial resources, but also
    the lack of appropriate service delivery, availability such as
    basic primary health care.
        To further develop our population base and primary care
    services in this jurisdictions will require a realistic
    development and allow for them to attain an even playing field
    in terms of competing for Federal assistance with those of the
    U.S. based health care services.
        All tertiary care patients are referred out of the region
    for treatment. This does not only drain the jurisdiction's
    limited health budget, but also causes significant
    sociocultural dysfunction in the health care delivery for these
    patients who access such services. In some years, up to 30
    percent of the country's health budget has been spent on
    tertiary care, out of the region to Hawaii or the Philippines.
    Less than 1 percent of the population uses tertiary care, and
    yet this 1 percent consumes up to 30 percent of the total
    health budget, which places a significant burden on primary
    population base health care services.
        The disparities in health in the U.S. affiliated Pacific
    jurisdictions becomes more intense when it is eclipsed by the
    stagnated education system that is unable to produce students
    who are able to matriculate in health related fields, such as
    medical, dental, nursing and allied health schools. The
    shortage of physicians, dentists, nurses and allied health
    necessitates the recruitment of expatriates, which is not only
    expensive, it retards sustainable human resource development in
    health. The disparity is also exacerbated by the shortage of
    qualified health care managers and administrators.
        The application of domestic Federal health program
    requirements through this U.S. affiliated Pacific Island
    jurisdiction sometimes retards the appropriate progress in
    health care development as it tends to create inappropriate
    models of health care in the region.
        The digital divide even further isolate these islands
    through the lack of adequate communication capabilities. The
    Freely Associated States, FSA, Marshall and Palau Islands are
    adversely affected because they are not considered insular
    areas by the Federal Communications Commission and therefore,
    ineligible for the discounted telecommunication rates for
    health and communication offered by the universal service fund.
        The extreme distances and travel time not only among the
    jurisdiction but also distance to the U.S. complicates this
    digital divide. For example, Palau is one complete day, 13 time
    zones away, and 22 flight hours by commercial jet travel from
    Washington, DC.
        Appropriate and timely health information systems continue
    to play an integral role in failing to describe the full extent
    of these mentioned disparities. While there have been
    improvements so that now we are quoted as Pacific Islanders and
    not others, there continues to be a significant health
    information disparities in research and information collection
    analysis and translation.
        To this end, the Pacific Island Health Officers Association
    is grateful to the Department of Health and Human Services
    through HRSA, CDC and NIH and the Department of Interior Office
    of Insular Affairs, for all of their direct and indirect
    support for PIHOA. PIHOA is also grateful for the resources
    provided through the Department of HHS and its program, which
    includes the community health centers, National Health Service
    Corps, Community Action programs, human resources development
    programs, such as area health education centers and health
    career opportunity programs, and the many condition-specific
    programs, such as HIV/AIDS, STD, diabetes control and
    collaborating, tuberculosis, immunization, cancer prevention
    and control, and last, bioterrorism resources that come from
    CDC and HRSA.
        While there remain significant health disparities in the
    U.S. Pacific Island jurisdictions, there has been some tangible
    improvement. For example, in some of the jurisdictions, while
    the infant mortality rate is still high compared to the United
    States, there has been as much as six to one person reduction
    of infant mortality rate over the past 13 years.
        In conclusion, Mr. Chairman, PIHOA and the many indigenous
    populations of the Pacific jurisdiction thank you for this
    opportunity to tell our story. At the end of the day, we
    request that our quest for self-sufficiency in health be at the
    cornerstone of your delivery today and in the future.
        I thank you specifically for allowing me, a Pacific
    Islander, from the Pacific, to testify on this occasion.
    Because that in itself is a benchmark of your efforts to
    eliminate disparities among the U.S. affiliated Pacific
    jurisdictions, and the spirit of the Pacific peoples.
        Thank you for your attention, and I will submit the
    prepared statement for the record.
        [The prepared statement of Dr. Benjamin follows:]
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        Mr. Burton. Thank you very much, Dr. Benjamin.
        I guess the only real question I have of you, and it was
    pretty much the same question we had of the Governors, what are
    the needs, immediate needs of each one of the territories, and
    how could we best help you solve that problem. I think what I
    would like to have you do, if you would, is to give us that in
    writing, so that we can draft a letter and send it to the
    organization that the President has appointed where various
    agencies get together and try to come up with solutions of
    problems of the territories.
        We'll also send a letter to the head of HHS urging them to
    take positive action on the financial requests that will take
    care of your needs. That I think should be the focus of our
    hearing today. My colleagues who have been with us today have
    legislative proposals which may or may not reach fruition. We
    may or may not get them passed because as I said before, we
    have these budgetary constraints that are very severe.
        But at the same time, I think that if we collectively write
    a letter to as well as personally contact the people on this
    commission that the President has appointed, as well as the
    Secretary of Health and Human Services, we might be able to
    shake loose the funds that are necessary to get your various
    territories over the hump as far as immediate health care needs
    are concerned. I think that's the first thing that needs to be
    done. Then we can work on the legislative proposals that they
    talked about.
        And with that, do any of you have any comments you'd like
    to make to add to what Dr. Benjamin said? Dr. Hofschneider, do
    you have any comments you'd like to make?
        Dr. Hofschneider. Thank you, Mr. Chairman, for this
    opportunity. I'm here to elaborate more on the issues,
    especially affecting the CNMI and to give you more details
    about our needs. I also support the statement as a member of
    the Pacific Islands Health Officers Association, I support the
    statements and the priorities that have been discussed by Dr.
    Benjamin.
        Mr. Burton. When I met with you in Saipan, we went through
    your hospital, I think you pointed out some of the things you
    felt were necessary. You don't really need to go through them
    again with us today. What I really need, and what we really
    need is to have it very succinctly stated in writing what is
    needed, when it's needed, how much money is needed and why we
    need to get on with that as quickly as possible. I think that
    would probably be the best thing we could get. Then I'll try to
    get other Members of Congress who are not with us today to sign
    on to this letter and try to use their influence to shake loose
    the funds that are necessary.
        HHS has the money. It's just a matter of getting it
    allocated in the proper way so you folks are getting what needs
    to be allocated.
        Dr. McMillan.
        Mr. McMillan. Mr. Chairman, thanks for the promotion. It's
    just Mr. McMillan.
        There are two things I'd like to bring to your attention,
    sir. Guam's hospital is a Medicare participating hospital. And
    in my written testimony, we identify that our Medicare
    reimbursement is still subject to a TFRA count, because we're
    not part of the prospective payment system. And a very specific
    and actual thing to do would be to either re-base our TFRA
    count, that's the least popular alternative in my book. Second
    would be to either just eliminate the TFRA count completely for
    the hospital, or, and this would require a little bit of
    legislative work, allow Guam Hospital to be declared a critical
    access hospital. Those hospitals are reimbursed at 101 percent
    of the cost based reimbursement.
        Prior to coming here, I gave Governor Camacho a list of 107
    specific Federal funding vehicles, either grant programs or
    grants or loan guarantees that we intend to rebuild our
    hospital with. I'll be happy to supply some specific
    recommendations for your committee to pass on to the HHS.
        Mr. Burton. What we'll do, when we write and contact the
    health agencies regarding the requests that are being made
    today is we'll cite all the various avenues that could be
    followed to get that money. And so I would like to have, did
    you say 107?
        Mr. McMillan. Yes, sir.
        Mr. Burton. If you give us a list of 107, I'll make sure
    that it is attached to the letter as an addendum, saying you
    figure you can't take it out of your general budget over there,
    here's 107 other ways you can do it.
        Mr. McMillan. Sir, there's one other thing I'd like to
    mention. We're very heavily dependent on foreign health care
    workers. Wage scales are a little low and we're kind of far
    from home for not only physicians but also nurses and allied
    health practitioners. The cap on the H1B visa program severely
    limits our ability to bring in the nurses, x-ray techs and that
    sort of thing. There's an H1C visa program that if Guam was
    written into that specific visa program, we would be allowed to
    recruit a lot more nurses.
        Mr. Burton. That would probably now be under Homeland
    Security, I believe.
        Mr. McMillan. Yes, sir.
        Mr. Burton. It's either State Department or Homeland
    Security Act. Can you guys write that down, and let's check on
    that and see if we can't contact them about maybe changing the
    visa policies, so they can get more health professionals in
    there.
        Mr. McMillan. I realize that's not your purview, but I'm
    getting my licks in when I can.
        Mr. Burton. That's fine. It is, if it refers to the health
    care problems of the area. We certainly would like to help.
        [The prepared statement of Mr. McMillan follows:]
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        Mr. Burton. Dr. Hofschneider, I cut you off. I apologize.
    Did you have more you wanted to say, sir?
        Dr. Hofschneider. Thank you, Mr. Chairman.
        I just wanted to sort of reiterate that we have submitted
    testimony, written testimony to your subcommittee outlining the
    needs, the requests that we have in three specific areas. One
    is the funding for us to enhance our prevention and treatment
    of diabetes. As you know, as Governor Babauta noted earlier,
    our prevalence of kidney failure is five times compared to the
    national prevalence. We are the third in terms of, worldwide,
    for prevalence of Type 2 diabetes. Only the Pima Native
    Americans and Narauns have the higher prevalence that the
    indigenous people of the CNMI.
        So we will be asking for funding for prevention, as well as
    for treatment, including the treatment of the kidney
    complications. In addition, because of our aging infrastructure
    we need to upgrade our water system. Our water system, the
    water that is fed into the hospital is not suitable for medical
    uses, and it has to be treated. The system is now almost 20
    years old and needs to be upgraded. The demands have increased.
        In addition, we have a problem with our air conditioning
    and ventilation system. And in this age of SARS and anthrax, we
    need to upgrade that.
        Last, a big burden and really, this has been mentioned
    several times, is the Medicaid cap. Currently we spend $13.5
    million, that's the total obligation of the local government,
    the Federal Government gives us $2.5 million, which is 90
    percent, this is Medicaid and SCHIP. And I think this burden is
    preventing access to proper care. We give the care anyway, we
    don't deny any services to the poor. But we really need some
    relief, especially at this time when we have a downturn in our
    economy.
        In my recent statement, I also noted that we have a 21
    percent increase in our Medicaid population since last year.
    This issue of inadequate funding is very important. We have
    been in a situation where we have to practically beg Hawaii
    hospitals or California hospitals to take our sick child or a
    person with multiple medical problems, take them so they can
    get adequate medical care. So really, we can never bring Hawaii
    closer to us. What was expressed earlier by our Governor and
    the Governor of Guam is the idea of having some regionalization
    as part of the long term strategy.
        So we ask for your support for this request, and thank you
    very much again.
        Mr. Burton. Well, like I said, if we have that in writing,
    and I think the Governor mentioned part of that, we'll
    certainly--that regionalism you're talking about I think makes
    a lot of sense. It might help us when we're trying to get
    resources if we say that they're cooperating in a way to,
    because you know, for instance, Guam and Saipan are not that
    far apart. If there was some way you could eliminate some
    duplication and use funds for other areas, it would be helpful
    when we're talking to HHS about more money.
        Dr. Kuartei, did you have a comment you'd like to make,
    sir?
        Dr. Kuartei. Thank you very much, Mr. Chairman, for the
    opportunity to be here. Dr. Benjamin actually spoke on behalf
    of the PIHOA. I can only say that as a Pacific Islander,
    sitting over here today, it's probably a benchmark for a moment
    that's probably positive. Thank you very much.
        Mr. Burton. Well, we really appreciate your being here and
    the Governors being here. We will not drop the ball on this. I
    can't guarantee how much money we're going to be able to shake
    loose and how much of the problem will be solved, but I promise
    you that I as the chairman of this subcommittee will push very
    hard, and I'll try to get other Members besides those who are
    here today to likewise push hard to get some of these things
    done.
        With that, thank you very much for being here. It's been
    nice being with all of you.
        We stand adjourned.
        [Whereupon, at 4:42 p.m., the subcommittee was adjourned,
    to reconvene at the call of the Chair.]
        [The prepared statement of Hon. Elijah E. Cummings and
    additional information submitted for the hearing record
    follow:]
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