    [House Hearing, 109 Congress]
    [From the U.S. Government Publishing Office]

                 EXAMINING THE IMPACT OF ILLEGAL IMMIGRATION
                       ON THE MEDICAID PROGRAM AND OUR
                         HEALTHCARE DELIVERY SYSTEM

                                    HEARINGS

                                   BEFORE THE

                            COMMITTEE ON ENERGY AND
                                    COMMERCE

                            HOUSE OF REPRESENTATIVES

                          ONE HUNDRED NINTH CONGRESS

                                 SECOND SESSION

                            AUGUST 10 AND 15, 2006

                              Serial No. 109-134

            Printed for the use of the Committee on Energy and Commerce

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

                                      -------

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                       COMMITTEE ON ENERGY AND COMMERCE
                          JOE BARTON, Texas, Chairman
    RALPH M.  HALL, Texas                     MARSHA BLACKBURN, Tennessee
    MICHAEL BILIRAKIS, Florida                JOHN D.  DINGELL, Michigan
      Vice Chairman                             Ranking Member
    FRED UPTON, Michigan                      HENRY A.  WAXMAN, California
    CLIFF STEARNS, Florida                    EDWARD J.  MARKEY, Massachusetts
    PAUL E.  GILLMOR, Ohio                    RICK BOUCHER, Virginia
    NATHAN DEAL, Georgia                      EDOLPHUS TOWNS, New York
    ED WHITFIELD, Kentucky                    FRANK PALLONE, JR., New Jersey
    CHARLIE NORWOOD, Georgia                  SHERROD BROWN, Ohio
    BARBARA CUBIN, Wyoming                    BART GORDON, Tennessee
    JOHN SHIMKUS, Illinois                    BOBBY L.  RUSH, Illinois
    HEATHER WILSON, New Mexico                ANNA G.  ESHOO, California
    JOHN B.  SHADEGG, Arizona                 BART STUPAK, Michigan
    CHARLES W.  "CHIP" PICKERING,  MississippiELIOT L.  ENGEL, New York
      Vice Chairman                           ALBERT R.  WYNN, Maryland
    VITO FOSSELLA, New York                   GENE GREEN, Texas
    ROY BLUNT, Missouri                       TED STRICKLAND, Ohio
    STEVE BUYER, Indiana                      DIANA DEGETTE, Colorado
    GEORGE RADANOVICH, California             LOIS CAPPS, California
    CHARLES F.  BASS, New Hampshire           MIKE DOYLE, Pennsylvania
    JOSEPH R.  PITTS, Pennsylvania            TOM ALLEN, Maine
    MARY BONO, California                     JIM DAVIS, Florida
    GREG WALDEN, Oregon                       JAN SCHAKOWSKY, Illinois
    LEE TERRY, Nebraska                       HILDA L.  SOLIS, California
    MIKE FERGUSON, New Jersey                 CHARLES A.  GONZALEZ, Texas
    MIKE ROGERS, Michigan                     JAY INSLEE, Washington
    C.L.  "BUTCH" OTTER, Idaho                TAMMY BALDWIN, Wisconsin
    SUE MYRICK, North Carolina                MIKE ROSS, Arkansas
    JOHN SULLIVAN, Oklahoma
    TIM MURPHY, Pennsylvania
    MICHAEL C.  BURGESS, Texas

                          BUD ALBRIGHT, Staff Director
                         DAVID CAVICKE, General Counsel
          REID P. F. STUNTZ, Minority Staff Director and Chief Counsel

                                     CONTENTS

                                                                            Page
    Hearings held:
         August 10, 2006	                                                  1
         August 15, 2006	                                                 62
    Testimony of:
         Ketron, Hon. Bill, Member, Tennessee State Senate 	                 12
         Rowland, Hon. Donna, Member, Tennessee State House of
              Representatives 	                                         15
         Gordon, Darin J., Deputy Commissioner, Bureau of TennCare	         25
         Smith, Dennis G., Director, Center for Medicaid and State
              Operations, Centers for Medicare & Medicaid Services	         29
         Flores, Richard, Vice President of Revenue Cycle,
              LifePoint Hospitals	                                         47
         Duncan, Bob, Vice President for Advocacy and
              Government Relations, Methodist Healthcare-
              LeBonheur Children's Medical Center	                         49
         Perrizo, Gary, Director of Patient Accounting,
              Department of Finance, Vanderbilt University Medical
              Center	                                                 52
         Cagle, Hon. Casey, Member, Georgia State Senate	                 74
         Rogers, Hon. Chip, Member, Georgia State House of
              Representatives	                                         80
         Thompson, Hon. Curt, Member, Georgia State Senate	                 87
         Sheil, Jean, Director, Family and Children's Health
              Program, Center for Medicaid and State Operations,
              Centers for Medicare & Medicaid Services	                107
         Siskin, Dr. Alison, Specialist in Immigration Legislation,
              Domestic Social Policy Division, Congressional
              Research Service	                                        112
         Ortiz, Abel C., Health and Human Services Policy
              Advisor, Office of the Governor, State of Georgia	        120
         Gardner, Jr., James E., President and Chief Executive
              Officer, Northeast Georgia Health System	                146
         Stewart, Charles, Chief Executive Officer, Hutcheson
              Medical Center	                                        150
         Michaels, Dr. Marty, Chair, Georgia Chapter, American
              Academy of Pediatrics	                                        157

                   EXAMINING THE IMPACT OF ILLEGAL IMMIGRATION
                          ON THE MEDICAID PROGRAM AND OUR
                             HEALTHCARE DELIVERY SYSTEM

                             THURSDAY, AUGUST 10, 2006

                             HOUSE OF REPRESENTATIVES,
                         COMMITTEE ON ENERGY AND COMMERCE,
                                    Brentwood, TN.

    	The committee met, pursuant to notice, at 10:00 a.m., in the
    Main Room, Brentwood City Hall, 5211 Maryland Way,
    Brentwood, Tennessee, Hon. Nathan Deal [member of the
    committee] presiding.
         Members present: Representatives Deal and Blackburn.
         Staff present: Ryan Long, Counsel; Brandon Clark, Policy
    Coordinator; Chad Grant, Legislative Clerk; Purvee Kempf,
    Minority Professional Staff Member.
    	MR. DEAL.  The Committee will come to order, and the Chair
    recognizes himself for an opening statement.
    	This morning will hold the first session of a 2-day field hearing
    entitled, "Examining the Impact of Illegal Immigration on the
    Medicaid Program and Our Healthcare Delivery System."
    	Today, we will hear from three panels of distinguished and
    expert witnesses about the impact that illegal immigration is
    having on our healthcare delivery system and get their perspective
    on a few recent legislative provisions that were produced by this
    Committee in an effort to help address this ever-growing problem.
    	Once this portion of the field hearing has concluded, we will
    recess until Tuesday morning, at which point we will reconvene in
    Dalton, Georgia, to learn more about how illegal immigration is
    impacting that community and what steps Governor Perdue and
    others in Georgia are taking to address this problem.
    	Given that there are well over 11 million illegal aliens currently
    residing in the United States and the fact that this number is rapidly
    growing every day that we allow our borders to remain unsecured
    and our immigration laws to remain unenforced, there is no
    question that the problem of illegal immigration is one of the most
    important public policy debates currently in Congress.
    	I stand with my Republican colleagues in House in strong
    support of enacting an immigration reform bill that does what the
    American people expect and deserve.
    	We want to strengthen our borders and enforce our
    immigration laws.  Because as any healthcare provider will tell
    you, an ounce of prevention is certainly worth a pound of cure.
    	Unfortunately, it is clear that there are those on the other side
    of this issue that have absolutely no plan for securing our borders
    and no plan for stopping the flood of illegal immigration that is
    currently negatively impacting our public safety, our children's
    schools, and our healthcare system.
    	In 1996, Congress responded to the will of the people and
    passed the Illegal Immigration Reform and Immigration
    Responsibility Act, and one of the main provisions of that
    legislation was to limit all Federal benefits, including Medicaid
    coverage, to those who are lawfully in the United States.
    	Of course, people on the other side of this issue opposed that
    provision back then because they believed that your hard-earned
    tax dollars should go to pay for healthcare services for people that
    are in this country illegally.
    	And, it is a lot of these same people that are now opposing our
    efforts, to ensure that only citizens get access to the taxpayer-
    funded benefits.
    	The most unfair thing about what our opponents are advocating
    is that an illegal immigrant on Medicaid would almost certainly
    have a better healthcare benefits package than what is available to
    most taxpayers who are paying for those Medicaid benefits, and
    are paying for their own healthcare out of their own pockets.
    	Of course, we are not just sitting back and waiting for one
    single comprehensive legislative solution to pass both Houses of
    Congress.  We intend to address this problem whenever and
    wherever we can.
    	To help address the negative impact of illegal immigration on
    our healthcare system, the Energy and Commerce Committee
    produced two important provisions in the Deficit Reduction Act of
    2005, which is commonly known as the "DRA."
    	One of the provisions that I authored and fought to include in
    the DRA was a provision that requires States to obtain
    documentary evidence that the person applying for Medicaid
    benefits is actually a United States citizen, as required by law.
    	This is not a new concept for government programs, since the
    Medicare and SSI programs both require proof of citizenship for
    all beneficiaries.  It's just that Medicaid hasn't been seriously
    reformed since the 1960s and was a little behind the times.
    	Before the enactment of this provision, the Inspector General
    of the Department of Health and Human Services found that 46
    States and the District of Columbia allowed self-declaration of
    citizenship for Medicaid eligibility, and 27 of those States never
    verified any citizenship statements at any point.
    	This means that people simply had to say that they were
    citizens, in whatever language they choose to say it in, and that
    they would be eligible for thousands of dollars of taxpayer funded
    Medicaid benefits.
    	I believe that is simply unacceptable.
    	Of course, the advocates on the other side of this issue fought
    very hard to prevent this provision from being included in the
    DRA and they fought very hard to defeat this needed legislation
    when it was being voted on by Congress.
    	And now, some of those same advocates are fighting just as
    hard to weaken this common-sense provision as much as possible,
    but it is my hope that those who are implementing this provision
    will stand firm on what I consider a very important issue.
    	Another provision we included in the Deficit Reduction Act
    was a provision to allow States the flexibility to impose cost
    sharing on healthcare services furnished in an emergency room
    that a physician determines is not a real medical emergency, such
    as an ear infection or strep throat.
    	To protect beneficiaries, this provision requires that an
    available and accessible alternative must be available to the
    beneficiary and the treating hospital must refer the individual to
    that alternative site in order for the co-pay, which we have
    provided, to be charged.
    	Like the citizenship-verification provision, this provision is
    designed to eliminate millions of dollars of waste in the Medicaid
    system by helping to ensure that Medicaid patients receive care in
    the most appropriate setting.
    	This provision, I believe, also helps patients.  Studies have
    shown that patients who receive care in the appropriate setting
    have better healthcare outcomes.
    	As we all know, the ER is not the best place to receive primary
    care services or preventative healthcare.
    	Although this provision only applies to Medicaid beneficiaries,
    it will also help reduce some of the negative impact of illegal
    immigrants improperly utilizing the ER, and it provides $50
    million in grant funding to the States to establish alternative non-
    emergency providers in communities across the United States.
    	In addition to the increased number of alternative non-
    emergency providers, this provision will also make hospital
    personnel more familiar and comfortable with referring non-
    emergency patients to the appropriate healthcare providers.  It will
    also increase communication between ER personnel and those non-
    emergency providers.
    	The logic behind this provision is also very simple.  It costs
    approximately $340 to care for a non-emergency patient in the
    emergency department while it costs less than $70 to care for the
    same patient in a health clinic or physician's office.
    	That means over five people can be treated in a physician's
    office for less money than one person can be seen in the
    emergency department.
    	Again, I believe that this is a common sense approach to
    reforming a Medicaid program, and I believe it is one of those
    serious reforms that we should help sustain.
    	As always, I am looking forward to having a cooperative and
    productive conversation on this topic today and to working with
    my colleagues to come up with even more effective solutions to
    the problems that I'm sure we will address during this hearing.
    	Again, I would like to thank all of our witnesses who will be
    participating today.  We look forward to hearing your testimony.
    	And again, I express my appreciation to Congresswoman
    Blackburn and her staff.
    	At this time, as a part of the committee formalities, I would like
    to ask unanimous consent that all Members be allowed to submit
    statements and questions for the record.  Without objection, it is so
    ordered.
    	I would also like to ask unanimous consent that all members be
    given 10 minutes of question time per panel and that all members
    be given 5 minutes for opening statements at both venues of this
    field hearing, and, without objection, it is so ordered.
    	I would like at this time to recognize my friend from
    Tennessee, Mrs. Blackburn, for 5 minutes for an opening
    statement.
    	[The prepared statement of Nathan Deal follows:]

    PREPARED STATEMENT OF THE HON. NATHAN DEAL, A REPRESENTATIVE IN CONGRESS
    FROM THE STATE OF GEORGIA

     The Committee will come to order, and the Chair recognizes
    himself for an opening statement.
     This morning will hold the first session of a two-day field
    hearing entitled "Examining the Impact of Illegal Immigration
    on the Medicaid Program and Our Healthcare Delivery
    System."
     Today, we will hear from three panels of distinguished and
    expert witnesses about the impact that illegal immigration is
    having on our healthcare delivery system and get their
    perspective on a few recent legislative provisions that were
    produced by this Committee in an effort to help address this
    ever-growing problem.
     Once this portion of the field hearing has concluded, we will
    recess until Tuesday morning, at which point we will
    reconvene in Dalton, Georgia, to learn more about how illegal
    immigration is impacting that community and what steps
    Governor Perdue and others in Georgia are taking to address
    this problem.
     Given that there are well over 11 million illegal aliens
    currently residing in the United States and the fact that this
    number is rapidly growing every day that we allow our borders
    to remain unsecured and our immigration laws to remain
    unenforced, there is no question that the problem of illegal
    immigration is one of the most important public policy debates
    currently before Congress.
     I stand with my Republican colleagues in House in strong
    support of enacting an immigration reform bill that does what
    the American people expect and deserve.
     We want to strengthen our borders and enforce our
    immigrations laws.  Because as any healthcare provider will
    tell you, an ounce of prevention is worth a pound of cure.
     Unfortunately, it is clear that those on the other side of the
    issue have absolutely no plan for securing our borders and no
    plan for stopping the flood of illegal immigration that is so
    negatively impacting our public safety, our children's schools,
    and our healthcare system.
     In 1996, Congress responded to the will of the people and
    passed the "Illegal Immigration Reform and Immigrant
    Responsibility Act," and one of the main provisions of this
    legislation was to limit all Federal benefits, including
    Medicaid coverage, to those who are lawfully in the United
    States.
     Of course, people on the other side of this issue opposed this
    provision back then because they believed that your hard-
    earned tax dollars should go to pay for healthcare services for
    people that are in your country illegally
     And it is a lot of these same people that are now opposing our
    efforts to ensure that only citizens get access to the taxpayer
    funded benefits.
     The most unfair thing about what our opponents are
    advocating is that an illegal immigrant on Medicaid would
    almost certainly have a better healthcare benefits package that
    what is available to most of the taxpayers who are paying for
    those Medicaid benefits.
     Of course, we are not just sitting back and waiting on a single
    comprehensive legislative to pass both Houses of Congress.
    We intend to address this problem whenever and wherever we
    can.
     To help address the negative impact of illegal immigration on
    our healthcare system, the Energy and Commerce Committee
    produced two important provisions in the Deficit Reduction
    Act of 2005, which is commonly known as the "DRA."
     One of the provisions that I authored and fought to include in
    the DRA was a provision that requires States to obtain
    documentary evidence that the person applying for Medicaid
    benefits is actually a U.S. citizen, as required by law.
     This is not a new concept for government programs, since the
    Medicare and SSI programs both require proof of citizenship
    for all beneficiaries.  It's just that Medicaid hadn't been
    seriously reformed since the 1960's and was a little behind the
    times.
     Before the enactment of this provision, the Inspector General
    of the Department of Health and Human Services found that
    46 states and the District of Columbia allowed self-declaration
    of citizenship for Medicaid, and 27 of those States never
    verified any citizenship statements at any point.
     This means that people simply had to say that they were
    citizens, in whatever language they chose to say it in, and they
    would be eligible for thousands of dollars of taxpayer funded
    Medicaid benefits.
     This was simply unacceptable.
     Of course, the advocates on the other side of this issue fought
    very hard to prevent this provision from being included in the
    DRA and they fought very hard to defeat this needed
    legislation when it was being voted on by Congress.
     And now, these same advocates are fighting just as hard to
    weaken this common-sense provision as much as possible, but
    it is my hope that those implementing this provision will stand
    firm on this important issue.
     Another provision we included in the Deficit Reduction Act
    was a provision to allow States the flexibility to impose
    increased cost-sharing on healthcare services furnished in an
    emergency room that a physician determines is not a real
    medical emergency, such as an ear infection or strep throat.
     To protect beneficiaries, this provision requires that an
    available and accessible alternative must be available to the
    beneficiary and the treating hospital must refer the individual
    to that alternative site in order for the co-pay to be charged.
     Like the citizenship-verification provision, this provision is
    designed to eliminate millions of dollars of waste in the
    Medicaid system by helping to ensure that Medicaid patients
    receive care in the appropriate setting.
     This provision also helps patients.  Studies have also shown
    that patients who receive care in the appropriate setting have
    better health outcomes.
     As we all know, the ER is not the best place to receive primary
    care services or preventative healthcare.
     Although this provision only applies to Medicaid beneficiaries,
    it will also help reduce some of the negative impact of illegal
    immigrants improperly utilizing the ER by providing $50
    million in grant funding to the States to establish alternative
    non-emergency providers in communities across the United
    States.
     In addition to the increased number of alternative non-
    emergency providers, this provision will also make hospital
    personnel more familiar and comfortable with referring non-
    emergency patients to the appropriate healthcare providers.  It
    will also increase communication between ER personnel and
    these non-emergency providers.
     The logic behind this provision is simple.  It costs
    approximately $340 to care for a non-emergency patient in the
    emergency department while it costs less than $70 to care for
    the same patient in a health clinic or physician's office.
     That means over five people can be treated in a physician's
    office for less money than one person can be seen in the
    emergency department.
     Again, I believe that this is a common sense approach to
    reforming a Medicaid program that is in serious need of
    reform.
     As always, I am looking forward to having a cooperative and
    productive conversation on this topic today and to working
    with my colleagues to come up with effective solutions to the
    problems addressed at this hearing.
     Again, I would like to thank all of our witnesses for
    participating today.  We look forward to hearing your
    testimony.
     And I would like to thank Congressman Blackburn and her
    staff for serving as such gracious hosts and for all their hard
    work that has made today's field hearing possible.
     At this time, I would like to ask for Unanimous Consent that
    all Members be allowed to submit statements and questions for
    the record.
     I would also like to ask for Unanimous Consent that all
    Members be given 10 minutes of question time per panel and
    that all Members be given 5 minutes for opening statements at
    both venues of this field hearing.
     With that, I would like to recognize my friend from Tennessee,
    Ms. Blackburn, for 5 minutes for an opening statement.

    	MRS. BLACKBURN.  Thank you, Mr. Chairman.  I thank you for
    visiting our 7th District today to investigate the financial burden
    that is placed on our healthcare system by illegal immigration.
    	I also want to say thank you to the City of Brentwood, to the
    Mayor, the Commissioners, and the staff, for their hospitality in
    welcoming us and allowing the use of this facility today.  Thank
    you also to the Committee staff, to your staff, and to my staff, for
    the preparations that have gone into today's hearing.
    	I would like to also welcome and thank our witnesses who are
    joining us today to help our committee, the Energy and Commerce
    Committee, explore some of the anecdotal information we are
    hearing every day on the costs of this problem, and the problem
    that it is creating for our Nation's healthcare delivery.
    	I was a bit amused with the headline in the Tennessean today,
    and then a part in their article where it says, "... and a Washington,
    D.C. think tank has begun to counter the arguments that it thinks
    might be brought up today."
    	So, to our witnesses, may I assure you that we are definitely
    interested in, and want to hear, and need to hear, the information
    that you are bringing to us.  It is not for the sake of argument that
    we come, but we come in search of solutions, and we thank you for
    joining us as we work toward a solution.
    	As the Chairman noted in his statement, for the past 20 years
    Federal benefits have been limited to those, to those, who have
    lawfully entered the United States.  Yet, as we know, many of
    those legal limits are either ignored or avoided through fraud.  We
    have a large and growing illegal entry problem, and along with that
    illegal entry we are increasingly finding that taxpayer funded
    benefits are being provided to illegal aliens.
    	The problem appears to be a mixture of legal loopholes, weak
    or nonexistent verification procedures, and false documentation.
    Our hope is that your testimony will, indeed, provide additional
    insight on these situations.
    	We know that the strain is on our emergency rooms, our
    schools, and our safety net programs for seniors and low-income
    Americans.  They have already taken a toll, and it does not appear
    to be abating.
    	I do applaud Chairman Deal's work on the issue and his effort
    to reform the residency verification process in Medicaid.  I
    strongly supported his effort to add language to the Deficit
    Reduction Act to ensure that states verify lawful presence in the
    U.S. before approving a benefit.
    	As the Chairman stated, today's hearing is one of many that
    will examine how States are implementing this money-saving
    provision and review the current status of Medicaid payments for
    both emergency and non-emergency care.
    	I want to state unequivocally that primary responsibility for
    preventing illegal entry rests with the Federal government.  Border
    security is the Federal government's obligation, but it is also
    necessary for local and State governments to be vigilant partners in
    guarding taxpayer dollars and benefit programs like Medicaid from
    abuse.
    	It benefits States to diligently keep records on the illegal use of
    taxpayer-funded services.  To be good partners, the Federal
    government and our States have to know the extent of the problem-
    -that's one of the reasons, as I've said, that we are here today.
    	The House has also passed a border security bill which
    includes provisions of a bill I introduced to mandate the use of the
    Employer Verification Program.  This one element I believe would
    help Government and employers quickly verify an individual's
    legal presence in the United States.  It's a free program, so it does
    not add cost to an employer's hiring process.
    	The primary point of our investigation is simple: We have
    limited resources to support programs for those in this country
    legally, and it is simply inappropriate that taxpayer dollars be used
    for those who have broken our laws and are defrauding our system.
    To know the extent of the costs involved, Congress must hold
    hearings like this one today.
    	I am looking forward to hearing from the witnesses on the
    costs that they are seeing and having their thoughts regarding how
    we might best address the misuse of taxpayer dollars.  As I've said,
    your knowledge and your insights are vital components of a
    workable solution.
    	Again, I thank the Chairman for holding the hearing, and I
    yield back the balance of my time.
    	[The prepared statement of Marsha Blackburn follows:]

    PREPARED STATEMENT OF THE HON. MARSHA BLACKBURN, A
    REPRESENTATIVE IN CONGRESS FROM THE STATE OF TENNESSEE

    Mr. Chairman,
     	Thank you for visiting our 7th District today to investigate the
    financial burden being placed on our health care system by illegal
    immigration.
     	I also want to thank the witnesses joining us today to help our
    Energy and Commerce Committee explore some of the anecdotal
    information we're hearing every day on the costs this problem is
    creating for the nation's health care delivery.
     	For the past 20 years, federal benefits have been limited to
    those who are lawfully in the United States.
     	Yet, as we know, many of those legal limits are either ignored
    or avoided through fraud.  We have a large and growing illegal
    entry problem and along with that illegal entry we're increasingly
    finding that taxpayer funded benefits are being provided to illegal
    aliens.
     	The problem appears to be a mixture of legal loopholes, weak
    or nonexistent verification procedures, and false documentation.
     	The strain on our emergency rooms, schools, and safety net
    programs for seniors and low-income Americans has already taken
    a toll and does not appear to be abating.
     	I applaud Chairman Deal's work on this issue and his effort to
    reform the residency verification process in Medicaid.  I strongly
    supported his effort to add language to the Deficit Reduction Act
    to ensure that states verify lawful presence in the U.S. before
    approving a benefit.
     	Today's hearing is one of many that will examine how states
    are implementing this money-saving provision and review the
    current status of Medicaid payments for emergency and non-
    emergency care.
     	I want to state unequivocally that primary responsibility for
    preventing illegal entry rests with the federal government.  Border
    security is the federal government's obligation, but it also
    necessary for local and state governments to be vigilant partners in
    guarding taxpayer dollars and benefit programs like Medicaid from
    abuse.
     	It benefits states to diligently keep records on the illegal use of
    taxpayer-funded services.  To be good partners, the Federal
    government and our States have to know the extent of the problem
    -- that's one of the reasons we're here today.
     	The House has also passed a border security bill which
    includes provisions of a bill I introduced to mandate the use of the
    Employer Verification Program.  This is one element I believe
    would help government and employers quickly verify an
    individuals legal presence in the U.S.  It's a free program so it does
    not add cost to an employers hiring process.
     	The primary point of our investigation is simple -- We have
    limited resources to support programs for those in this country
    legally and it is simply inappropriate that taxpayer dollars be used
    for those who've broken our laws and are defrauding our system.
    To know the extent of the costs involved Congress must hold
    hearings like this one.
     	I am looking forward to hearing from the witnesses on the
    costs they're seeing and thoughts regarding how we might best
    address this misuse of taxpayer dollars.
     	Again, I thank the Chairman for holding this important hearing
    and yield the balance of my time.

    	MR. DEAL.  Well, I thank the gentlelady, and at this time we
    are ready to proceed into the testimony from the first panel of
    witnesses, and if they would both take their seat at the podium
    here.
    	We are pleased to have as our first panel Representatives from
    the legislature here in the State of Tennessee.  First of all, the
    Honorable Bill Ketron, who is a Tennessee State Senator; and the
    Honorable Donna Rowland, who is a Member of the Tennessee
    House of Representatives.
    	Lady and gentleman, we are pleased to have you here.
    Normally, southern hospitality would require that I recognize the
    gentlelady first, but in looking at her statement she sort of makes a
    reference to your statement first Senator, I will begin with you.
    	You are recognized, Senator Ketron.

    STATEMENTS OF HON. BILL KETRON, MEMBER, TENNESSEE STATE SENATE; AND THE HON.
    DONNA ROWLAND, MEMBER, TENNESSEE STATE HOUSE OF REPRESENTATIVES

    	MR. KETRON.  Thank you very much, Mr. Chairman, members
    of the subcommittee.
    	I would like to first welcome you to the great State of
    Tennessee, the Volunteer State, and hope you enjoy your short stay
    here with us today.  We are very proud of our State and its leaders,
    including the Congressman from the 7th District, Marsha
    Blackburn.
    	I also want to take the opportunity to meet with you today to
    discuss the illegal immigration problem here in the United States,
    and specifically here in Tennessee.
    	I will start by repeating something that I heard the other day,
    which is very relevant.  Every State is a border State.  Ten years
    ago, many people would have chuckled if you said that illegal
    immigration would have been a problem anywhere, except for
    Texas, Arizona, California, or New Mexico.  In Tennessee,
    particularly over the last few years, the number of illegal
    immigrants have appeared to rise dramatically.
    	As a State Senator, I have spent the past 4 years working on
    changes in our public policy in regard to illegal immigration.   One
    of the specific areas of concern to me was that the ease for illegal
    immigrants to obtain valid Tennessee driver's licenses.  I have
    heard repeatedly the stories and news accounts of the astounding
    number of immigrants coming to Tennessee to get a driver's
    license.  I did not feel that Tennessee needed to be in the business
    of providing driver's licenses to those who had not established
    their true identity so that they could be free to move about the
    country.  I am proud to say that Tennessee now prohibits the
    acceptance of matricular consular card by the Department of
    Safety as proof of identification for the driver's license application
    and issuance purposes.
    	I also feel Tennessee has been attractive to illegal immigrant
    population due to one of the most generous healthcare plans in the
    United States which is called TennCare.  Although there is debate
    over how much Medicaid actually goes to illegal immigrants, it is
    very clear that the emergency care in the hospitals and state clinics
    have felt the burden of healthcare to the community.
    	Furthermore, Tennessee's job opportunities due to tremendous
    growth have spurred the need of thousands of jobs that illegal
    immigrants are willing to do for less money than the legal citizen
    workforce.
    	I hear many individual accounts of how illegal immigration has
    taken a toll on Tennessee, but three common themes persist.  First,
    illegal immigration is eating away at the foundation of our State's
    healthcare systems.  Second, our K-12 educational systems are
    struggling to deal with a huge influx of illegal aliens--many of
    whom do not yet speak English or read English.  Third, our law
    enforcement system is besieged with the problem of how to deal
    with the rising number of illegals crowding jails that are already at
    capacity, not to mention the rise of violent crimes committed by
    undocumented immigrants.
    	These are some of the questions that I have been asked.  How
    many illegal immigrants are getting free healthcare while
    Tennesseans go without?
    	How many of our tax dollars are spent on healthcare for illegal
    immigrants?
    	How many of the prisoners in our State and local prisons are
    illegal immigrants?
    	What is the effect of having children in our classrooms who
    cannot speak English?
    	Is it true that illegal immigrants are still getting driver's
    licenses?
    	How many Tennesseans have been victims of crimes at the
    hands of illegal immigrants?
    	We, here in Tennessee, are working to find the answers but we
    could use your help.
    	At their core, the people in Tennessee want to see Tennessee
    families come first.  This State has to make a decision to remove
    several thousand people from receiving healthcare, yet when
    illegal immigrants continually fill our emergency rooms and State
    clinics, people want to know why their neighbors and relatives
    don't have greater access to healthcare.
    	Tennesseans want criminals locked up and off the streets, and
    when they realize that our prisons are overcrowded and our tax
    dollars are paying for illegal immigrants who should not be here in
    the first place, they question our law enforcement priorities.  We
    must protect our citizens from the most dangerous criminals.
    	Tennessee has fallen behind in education, and teachers are
    forced to lay a  foundation for many of our students who cannot
    yet speak or read English while trying to advance students who
    have mastered and passed the basics.  We have to challenge the
    students, not slow them down.
    	Aside from the three prevailing themes I have already
    mentioned, I personally plan to continue my focus on the driver's
    license restrictions in our State.  We have got to protect our
    citizens on the road every day.  I have fought for English-only
    driver's testing in Tennessee, but that was a small fix considering
    we have many illegal immigrants on the road every day.
    Tennessee has been unfortunate through this summer to see its
    issues effects on the lives of people every day.
    	I would like to conclude my remarks by saying that it's been an
    honor to address this distinguished body.  I hope that together, at
    both the State and the Federal level, we can come up with some
    common-sense solutions to solve the problem now but not later.
    	Mr. Chairman, we, here in Tennessee, feel the same way that
    you do in Washington.  Our forefathers came here to establish laws
    that all of us as citizens of this country must obey.  We, like
    Representative Rowland, ourselves, like you, you established laws
    that we all must abide by to keep from having chaos in our
    country.
    	When we pass laws for people to abide, it's not fair to turn a
    blind eye for those who don't have to obey the laws, and that's
    what's happening and it continues, and that's what's causing the
    divide in this country.  We must all obey the laws, no matter who
    you are or where you come from.  And, if it says that you are legal,
    then you must be legal.  That is the law.  That's all we request.
    	Thank you.
    	[The prepared statement of Bill Ketron follows:]

    PREPARED STATEMENT OF THE HON. BILL KETRON, MEMBER, TENNESSEE STATE SENATE

            Mr. Chairman, Members of the Subcommittee:
    	I would like to first welcome you to the great state of
    Tennessee, the Volunteer state, and hope you enjoy your short
    stay.  We are very proud of our state and its leaders, including the
    Congressman from the 7th District, Marsha Blackburn.
     	I want to also thank you for the opportunity to meet with you
    today to discuss the illegal immigration problem in the United
    States, and specifically here in Tennessee.
     	I will start by repeating something I heard the other day that is
    very relevant.  Every state is a border state.  Ten years ago many
    people would have chuckled if you said that illegal immigration
    would be a problem anywhere except Texas, Arizona, California,
    and New Mexico.  In Tennessee, particularly over the last few
    years, the number of illegal immigrants has appeared to rise
    dramatically.
     	As a state Senator, I have spent the past 4 years working on
    changes in our public policy in regard to illegal immigration.  One
    of the specific areas of concern to me was the ease for illegal
    immigrants to obtain a valid Tennessee driver's license.  I have
    heard repeatedly the stories and news accounts of the astounding
    number of immigrants coming to Tennessee to get a driver's
    license.  I did not feel that Tennessee needed to be in the business
    of providing driver licenses to those who had not established their
    true identity so that they could be free to move about the country!
    I am proud to say Tennessee now prohibits the acceptance of
    matricula consular cards by the Department of Safety as proof of
    identification for a driver's license application and issuance
    purposes.
     	I also feel Tennessee has been attractive to the illegal
    immigrant population due to one of the most generous healthcare
    plans in the United States--TNCare.  Although there is a debate
    over how much Medicaid actually goes to illegal immigrants, it is
    very clear that emergency care in the hospitals and state clinics
    have felt the burden of healthcare to this community.
     	Furthermore, Tennessee's job opportunities due to tremendous
    growth have spurred the need for thousands of jobs that illegal
    immigrants are willing to do for less money than the legal citizen
    workforce.
     	I hear many individual accounts of how illegal immigration has
    taken a toll on Tennessee, but three common themes persist.  First,
    illegal immigration is eating away at the foundations of the states
    Health Care systems.  Second, our K-12 educational systems are
    struggling to deal with a huge influx of illegal aliens-many of
    whom do not yet speak or read English.   Third, our law
    enforcement system is besieged with the problem of how to deal
    with rising numbers of illegals crowding jails that were already at
    capacity - not to mention the rise in violent crimes committed by
    undocumented immigrants.
    These are some questions that I have been asked:

            How many illegal immigrants are getting free health care while
    many Tennesseans go without?

     	How many of our tax dollars are spent on health care for illegal
    immigrants?

     	How many of the prisoners in our state and local prisons are
    illegal immigrants?

     	What is the effect of having children in our classrooms who
    cannot speak English?

     	Is it true that illegal immigrants are still getting driver's
    licenses?

    How many Tennesseans have been victims of crimes at the
    hands of an illegal immigrant?
     	We, here in Tennessee, are working to find the answers but we
    could use your help.
     	At their core, the people in Tennessee want to see Tennessee
    families come first.  This state had to make a decision to remove
    several thousand people from receiving healthcare, yet when
    illegal immigrants continually fill our emergency rooms and state
    clinics, people want to know why their neighbors and relatives
    don't have greater access to healthcare.
    	Tennesseans want criminals locked up and off the streets, and
    when they realize that our prisons are overcrowded, and our tax
    dollars are paying for illegal immigrants who should not be here in
    the first place, they question our law enforcement priorities.  We
    must protect our citizens from the most dangerous criminals.
     	Tennessee has fallen behind in education, and teachers are
    forced to lay a foundation for many of our students who can't yet
    speak or read English while trying to advance students who have
    mastered and passed the basics.  We have to challenge our
    students, not slow them down.
     	Aside from the three prevailing themes I have already
    mentioned, I personally plan to continue my focus on driver's
    license restrictions in our state.  We have got to protect our citizens
    on the road every day.  I have fought for English-only driver's
    testing in Tennessee, but that is a small fix considering we have
    many illegal immigrants on the road every day.  Tennessee has
    been unfortunate enough this summer to see how this issue affects
    the lives of people every day.
     	I would like to conclude my remarks by saying what an honor
    it has been to address this distinguished body.  I hope that together,
    at both the state and federal level, we can come up with some
    common sense solutions to solve this problem now - not later.

    	MR. DEAL.  Thank you, Senator.
    	Representative Rowland, you are recognized for your
    statement.
    	MS. ROWLAND.  Good morning, Mr. Chairman, honorable
    members of the subcommittee.  It's a pleasure to be here today and
    to give some southern charm to each of you.
    	I want to welcome you to Tennessee and for this opportunity to
    express my community's concerns regarding illegal immigration.
    	My colleague, Senator Ketron, has done an excellent job of
    providing you an overview of the issues we hear on a daily basis.
    	I first want to commend you on the passage of the Deficit
    Reduction Act with the inclusion of the Citizenship Verification
    Provision.  But, please allow me to express some strengths that
    must remain a part of that provision.
    	Since acceptable documentation under this provision includes
    driver's license, the Federal government must immediately require
    States to issue driver's license and any other government-issued
    document only to those that can prove that they are a citizen or
    legal resident of said State.
    	In the case of questionable self-documents and declarations,
    simply requiring that a reasonable person find such statement
    suspect cause a very legally challengeable situation.  The term
    reasonable is open for interpretation.  Unfortunately, we can no
    longer take for granted that your definition of reasonable or my
    definition of reasonable mirrors anybody else's definition of
    reasonable.
    	Regrettably, self-declaration or the honor system has not
    proven to be a trusted avenue for citizenship verification.  Our
    country has spent years, via the Social Security Administration and
    the department formerly known as Immigration and Naturalization
    Services, to develop systems of tracking citizens and legal
    residents.  There are so many steps in life at which someone must
    prove their identity.  At birth, for example, a Social Security
    number is issued.  If it is missed there, a Social Security number is
    required for tax returns.  If it is missed there, a Social Security
    number is required for admission into our education system.  The
    process for receiving and verifying a Social Security number, or
    other legal immigration documents, allow for the verification of
    one's identity and legal status, and it must be included and not
    deviated from.
    	I understand that there are variations from State to State.  Due
    to the Federal funding that you provide to each State, you can, and
    you do have the power, to require this verification process be
    consistent.
    	Governments do this all the time.  For example, just recently
    on the State level in Tennessee, we developed a standard parenting
    plan form to be used in the court systems.  Now, this plan had been
    implemented and successful for many years, and it was an
    excellent tool for our court systems to use, but there were as many
    different forms as there were counties, because the locals were
    allowed to design the form.  We are such a mobile society that the
    degree of continuity must exist in order for law and order to be
    effective.
    	Detailed checklists must be provided.  This continuity has to
    exist among the States.  Unless this is accomplished, States will
    continue to have multiple reinventions of the wheel.  I'm
    proposing to the Federal government nothing more than I proposed
    time and again to my local State government, in the way of
    continuity and consistency.
    	Now, I want to address our efforts to date here in the State of
    Tennessee.  As a responsible representative of this State, I have
    introduced and supported numerous bills that would have protected
    Tennesseans, and I'm going to give you a list of those.
    	Require citizenship or legal residence to receive a driver's
    license.
    	Forbid Certificates of Driving for illegal aliens.
    	Require citizenship proof prior to registering to vote.
    	Require driver's license exam to be taken in English only.
    	Require citizenship verification for non-emergency healthcare
    services.
    	Require Tennessee to join the Federal program for verification
    of work authorization.
    	Require the Tennessee Highway Patrol to assist the Federal
    government in enforcement by way of a memo of understanding.
    It is my understanding that the State Department is very excited
    about the possibility of working with the States in this manner.
    	Regrettably, each of those bills failed in Tennessee this year.
    On the other side, States such as Arizona, Colorado, Georgia,
    Idaho, Kansas, Oklahoma, and Wyoming have been successful in
    implementing legislation similar to those I just mentioned that
    were introduced in Tennessee.
    	Unfortunately, in Tennessee we have a majority of elected
    officials who prefer to publicly state that illegal immigration is just
    a Federal issue.
    	My colleague has already stated that, from his perspective,
    every State is a border state.  I too submit to you that every State is
    a border State.  But, additionally, every town is a border town.  At
    the Federal level, as elected officials, you have the responsibility
    for securing our borders.  On the State level, it is my duty, and the
    belief of my constituents, to protect the borders of the State of
    Tennessee.
    	Today, I come to you and ask for your help, and this is how
    you can help us on the Federal level.
    	By requiring consistency among States.
    	By clearly defining processes, acceptable documentation, et
    cetera.
    	By clarifying that illegal immigration is a Federal issue, is a
    State issue, is a town issue.
    	The process for legal immigration is not meant to hinder
    anyone, it is meant to assure this great country is protected from
    such hindrances as illnesses, acts of aggression, et cetera.
    	We must all work together and stop passing the responsibility
    from one entity to the next.  If we don't, soon we will no longer be
    the greatest country there is.  We will no longer be a country.
    	I will conclude my remarks by saying what an honor it has
    been to address this body.  I do look forward to working on this
    issue and other issues in partnership with other States and the
    Federal government, for a better and more secure future, and I
    would welcome the opportunity to discuss in detail any of the
    legislation that I've brought forward that we discussed this year.
    	Thank you very much for this opportunity.
    	[The prepared statement of Donna Rowland follows:]

    PREPARED STATEMENT OF THE HON. DONNA ROWLAND, MEMBER,
    TENNESSEE STATE HOUSE OF REPRESENTATIVES

            Mr. Chairman and Honorable members of this Subcommittee:
            Welcome to Tennessee and thank you for the opportunity to
    appear and express my community's concerns regarding Illegal
    Immigration.
            My colleague, Senator Ketron has done an excellent job of
    providing an overview of the concerns we hear daily regarding this
    issue.
            I would like to commend you on the passage of the Deficit
    Reduction Act with the inclusion of the Citizenship Verification
    Provision.  Please allow me to express some strengths that are
    absent from this provision.
            Since acceptable documentation under this provision includes
    driver's license, the federal government must immediately require
    states to issue driver's license and any other government issued
    photo card or identification document only to those that can prove
    they are a citizen or legal resident of said state.
            In the case of questionable self declaration statements, simply
    requiring that a reasonable person find such statement suspect
    causes a very legally challengeable situation.  The term reasonable
    is open for interpretation.  We can no longer take for granted that
    your definition of reasonable mirrors anyone else's definition of
    reasonable.
            Regrettably, self declaration or the Honor system has not
    proven to be a trusted avenue for citizenship verification.  Our
    country has spent years via the Social Security Administration, as
    well as the former Immigration and Naturalization Services to
    develop systems of tracking and identifying citizens and legal
    residents.  There are so many steps in life at which some one must
    prove their identity.  At birth, a social security number or taxpayer
    identification number is assigned, if it is missed there, a social
    security number or taxpayer identification number is required for
    tax returns, if it is missed there; a social security number or
    taxpayer identification number is required for admission into our
    education system.  The process for receiving and verifying a social
    security number or taxpayer identification or other legal
    immigration document allows for verification of one's identity and
    legal status.
            I understand that there is variation among the states for
    citizenship verification.  Due to the Federal funding each state
    receives, you have the power to make this verification process
    consistent.
            Governments do this all the time.  Just recently on the state
    level, Tennessee developed a standard parenting plan form to be
    used in the court systems.  While this plan, which had been
    implemented years before was an excellent tool, there were as
    many different forms as there were counties due to the form design
    being left to the locals to develop.  We are such a mobile society
    now that some degree of continuity must exist for law and order to
    be effective.
            Detailed checklists must be provided in order for continuity to
    exist among the states.  Unless this is accomplished, states will
    continue to have multiple re-inventions of the wheel.  I am
    proposing to the Federal Government nothing more than I propose
    time and again to my own state government in the way of
    continuity and consistency.
            Now, to address our efforts to-date.  As a responsible
    representative of this state, I have introduced and supported
    numerous bills that would have protected Tennesseans.

            Require citizenship or legal residence to receive a driver's
    license.

            Forbid Certificates of Driving for illegal aliens.

            Require citizenship prove prior to registering to vote.

            Require driver's license exam to be taken in English only.

            Require citizenship verification for non emergency health care
    services.

            Require Tennessee to join the federal program for verification
    of work authorization.

            Require the Tennessee Highway patrol to assist the federal
    government in enforcement by way of a memo of
    understanding (It is my understanding that the State
    Department is very much in support of working together with
    our law enforcement in this manner).

            Regrettably, each of these bills failed in Tennessee this year.
    Yet other states (Arizona, Colorado, Georgia, Idaho, Kansas,
    Oklahoma, and Wyoming) have been successful in implementing
    legislation similar to those we introduced in Tennessee.
            Unfortunately, in Tennessee we have a majority of elected
    officials who prefer to publicly state that illegal immigration is a
    federal issue.
            My colleague has already stated that, from his perspective,
    every state is a border state.  I too submit to you that every state is
    a border state.  Additionally, every town is a border town.  At the
    federal level, as elected officials you have the responsibility of
    securing our borders.  On the state level, it is my duty (and the
    belief of my constituents) to protect the borders of the state of
    Tennessee.
            Today I ask you to help us.

            By requiring consistency among states.

            By clearly defining processes, acceptable documents, etc.

            By clarifying that illegal immigration is a federal issue, a state
    issue and a town issue.

            The process for legal immigration is not meant to hinder
    anyone, it is meant to assure this great country is protected from
    such hindrances as illness, acts of aggression, etc.
            We must all work together and stop passing the responsibility.
    If we don't soon we will no longer be the greatest country there is.
    We will no longer be a country.
            I will conclude my remarks by saying what an honor it has
    been to address this distinguished body.  I look forward to
    addressing this and other issues in partnership with other states and
    the federal government.

    	MR. DEAL.  Well, thank you both very much.  I will begin the
    questions, and then turn to Mrs. Blackburn after that.
    	I think you have accurately summarized the problems.  Years
    ago, when I was first elected to Congress, I became an active
    member of the Immigration Reform Caucus, and people kept
    asking me, well, Georgia is not a border State, why are you
    interested in this issue?  I kept saying, come to my district and you
    would believe otherwise.  That problem over the last decade has
    definitely magnified, and that's why as this hearing will now have
    its second segment in my congressional district in Dalton, Georgia,
    which is certainly one of those hubs where illegal immigration is
    very manifest.  I think you are appropriate in your analysis there.
    	Senator, as you have characterized the three big categories
    where the impacts are felt most profoundly are in healthcare, in
    education, and in law enforcement.  Obviously, the jurisdiction of
    our Health Subcommittee primarily restricts itself to that first
    inquiry, but the truth of the matter is, they are so integrated within
    themselves that you really can't separate one from the other.
    	Representative Rowland, I think that, hopefully, as we hear the
    second panel, and we will have Dennis Smith from CMS, who will
    expound upon some of the verification procedures that we have put
    in place, and he is implementing now through the regulatory
    process.  I think you will be pleased to see that we are making
    some real progress.
    	As you know, on your issue of having some uniformity on
    driver's licenses, we took what I think is an important step with
    what we call the Real Idea Act.  To say that if you are going to use
    a State driver's license for any Federal purpose, the one we
    commonly think of, since we travel so much going back and forth
    to Washington, is to board an aircraft that you must meet certain
    Federal criteria.  That Act will be in the process of being
    implemented.  I believe it will be, perhaps, one of the greatest
    boosts to your efforts here at the State level to change your State
    law, as you have both indicated you would like to do.
    	I am very impressed with your testimony.  I'm very impressed
    with what you are trying to do at the State level.  As you
    mentioned, my State of Georgia, the legislature last year took a
    monumental step in the direction of dealing with this issue, and
    maybe, quite frankly, now may be the most profound step by any
    State Legislature in recent times.  So, I commend you for that.  We
    will hear from my colleagues at the State level in Georgia next
    week.  Just keep up the efforts, that's what I will say to you, and I
    will allow my colleague to have the remaining amount of my time.
    	Mrs. Blackburn.
    	MRS. BLACKBURN.  Thank you so much, and I want to thank
    both of you for your interest in the issue, and then for coming
    before us today, and thank you for your well-prepared testimony.
    	Senator Ketron, I will say I have to agree with you in your
    closing remarks about laws.  I think Ben Franklin, in his discussion
    of whether we were a democracy or a republic, noted the fact that
    the laws that we have certainly, and the requirement to obey the
    laws, was one of the reasons we were a republic, and I think that is
    a founding principle that the laws of the land, the Constitution, be
    obeyed and be upheld.
    	I do have a couple of questions that I want to ask, I would like
    to propose to you, and, Senator Ketron, the questions you outlined
    in your testimony are so appropriate, I think that they are questions
    that we are hearing here in the State of Tennessee, and I would like
    to ask that you submit to us the answers to those, because they are
    some of the questions, as I was making my notes during your
    testimony, I know that we had heard at one point from the
    TennCare Administration that they felt there was not a problem
    with illegal immigrants, because there were very few, if any, who
    were getting TennCare.  And, I would be interested in your
    assessment of that, and then when you get quantifiable data having
    that submitted to us for the record, and, of course, we will continue
    to talk with Mr. Gordon about that issue.
    	Would you care to respond to that?
    	MR. KETRON.  Absolutely, Congressman.
    	I think everybody tries to sidestep that issue when it comes to
    illegal immigrants going into our emergency rooms, but it is a fact,
    and I'll be happy to try to retrieve that data if at all possible.
    	One of your colleagues I heard on a radio show some time back
    in the spring, Steven King, Congressman Steven King made a
    comment that we need to remove the Anchor Baby Provision in
    our country, like Canada has done 4 or 5 years ago, but that
    Anchor Baby Provision on a Federal level continues to allow
    illegal immigrants to come here and locks down, by putting that
    anchor in, it allows them to continue to use our healthcare services
    by going to the emergency room.
    	You know, we kicked off close to 300,000 people off of our
    TennCare Medicaid program, that had lived here all of their lives,
    but you let an illegal immigrant from whatever country outside of
    our country that is illegal come here and go into the emergency
    room, by law, Federal law, the hospitals have to pick up and pay
    for that, TennCare pays for that.
    	We have got to correct that situation, it's not fair to let those
    people come in front and go to the front of the line.
    	I talked to a lady just the other day in Lewisburg, Tennessee,
    just south of here.  She immigrated from Portugal just a few years
    ago, and she was really upset of all the problems that she had to go
    through, the hassles, and waiting time, and going through
    Memphis, through Immigration Control down in Memphis, and
    then anybody else just comes in and they get to go in the front of
    the line.
    	MRS. BLACKBURN.  Let me ask you this also.  You mentioned
    the matricular consular cards were no longer accepted as an ID
    source.  When was that change made?
    	MR. KETRON.  We changed that, Representative, 2 years ago.
    	MS. ROWLAND.  Two thousand and four.
    	MR. KETRON.  Two thousand and four.
    	MRS. BLACKBURN.  In 2004.
    	And, do you know if there has been a decrease in requests for
    medical care for illegal entrants since that time?  You do not?
    	MR. KETRON.  Not to my knowledge.
    	MRS. BLACKBURN.  Okay.  All right.
    	And, Representative Rowland, you mentioned several bills that
    had been supported this year that did not pass.  Requiring
    citizenship or legal residence to receive a driver's license.
    Forbidding Certificates of Driving for illegal immigrants.
    Requiring citizenship proof prior to registering to vote.  Requiring
    driver's license exam to be taken in English only.  Requiring
    citizenship verification for non-emergency healthcare services, and
    requiring Tennessee to join the Federal program for verification of
    work authorization.
    	So, to be certain that I understand you correct for the record, all
    of these were legislation pieces that were submitted but did not
    pass, they were bills that were introduced and moved forward in
    the Legislature but did not pass.
    	MS. ROWLAND.  Congressman, that is correct.  We had some
    success in the Senate with passing legislation.  Every piece failed
    in the House, either in subcommittee, full committee, or in a vote
    on the floor.
    	MRS. BLACKBURN.  Considering the situation as it is, then
    would you favor having some of those items, like the citizenship
    verification for non-emergency healthcare services, driver's license
    exam taken in English only, to receive reciprocity, the AMVA
    standards, citizenship proof prior to registering to vote, joining the
    Federal program for the verification of work authorization, would
    you consider receiving those as mandates, Federal mandates, on
    Tennessee State law in order to get them passed?
    	MS. ROWLAND.  Our local governments do not like us putting
    mandates on them.  We do not like receiving mandates when they
    are necessary.  Above all, though, it is our responsibility as a
    government body in Tennessee to implement these.  If it takes
    mandates to do that, I welcome the assistance.  It is our
    responsibility to introduce common-sense legislation and protect
    the borders of the State of Tennessee, and if we fail in that effort to
    do that then it is your responsibility to step in as a Federal
    government and dictate to us what should happen in order to
    protect our borders.
    	MRS. BLACKBURN.  Okay, thank you very much, and that's all
    the questions I have.
    	MR. DEAL.  I want to assure those of you who are familiar with
    legislation that I've introduced at the Federal level, I did not put
    the good Senator up to talking about anchor babies.  Since he did,
    let me tell you that I am the author of legislation that will do away
    with the birthright citizenship.
    	On that subject, it is one of those magnets, I believe, it is not
    probably as large a magnet as jobs themselves, but it, nevertheless,
    is a magnet.  We are in a distinct minority in the world community
    now of nations that recognize birthright citizenship.  By that I
    mean, if you are born on American soil, regardless of the
    circumstances whereby your parents got here, legally, illegally, or
    otherwise, you are considered a resident.
    	There are 135 countries in the world, all of Europe no longer
    recognizes that, and we are only one of 36, I believe now, that still
    continues to do that.
    	I believe it is an issue, and we do have legislation at the Federal
    level.  We are gaining support.  I think we are up to about 88 co-
    sponsors, we are gaining.  I think it's an issue that, hopefully, we
    will address at the Federal level.
    	I'm very impressed with both of your testimonies, and we will
    make it, of course, a part of the record for this committee, and we
    thank you both for what you've done here today by presenting it,
    and also for what you will continue to do at your legislative level
    in Tennessee.
    	MRS. BLACKBURN.  I have one more.
    	MR. DEAL.  Yes, Mrs. Blackburn.
    	MRS. BLACKBURN.  Mr. Chairman, if I may, looking back
    through my notes I did skip a question that I had for Senator
    Ketron.  In his testimony he spoke about law enforcement, as he
    spelled out the three issues with the healthcare system, the
    education system, and law enforcement.  The hearing that we did
    in San Diego, we heard from some of the sheriffs there, in Texas
    and in California, that the incarcerated population of some of their
    facilities as much as 80 percent of it would be an illegal
    population, illegal entrants.  Do you have an idea of what the
    percentage of illegal entrants are in the incarcerated population?
    	MR. KETRON.  Congressman Blackburn, this is off the cuff, but
    we did discuss this this past year.  One of my colleagues, Senator
    Steve Southerland from Hamlin County up in Morristown, he came
    with a bill that was requesting some relief because his jail in his
    county, because of the large number, I think next to Senator Tracy
    who is here today, who has the largest population of illegal
    immigrants, up in Morristown he has the second largest, and their
    jail has become so over crowded, over 45 percent with illegal
    immigrants.  They have lost their accreditation, and, consequently,
    when you lose your accreditation from the State then you receive
    less dollars in order to be reimbursed, so it's falling back upon the
    citizens of the community to help pay for that, albeit, many of
    those are not State offenses, but because of that the community, the
    county, is still having to pay for the healthcare, they are having to
    take them to dentist, or if they come in with TB, they have to now
    have a TB isolation chamber within the jail.  They come in with no
    shots, no health criteria as far as inoculation coming into our
    country, and we do require that for other citizens who come here.
    	So, I think that is a problem, and I think if we were able to run
    some numbers we would find that in many areas across our State,
    that it's over 30 percent anyway.
    	MRS. BLACKBURN.  Okay.  Mr. Chairman, I would like to ask
    as he submits answers on the other questions that were posed that
    we have that information, not that it's pertinent to this
    subcommittee, but to the overall it definitely is, and I would
    appreciate the submission.
    	MR. DEAL.  Without objection, it will be made a part of the
    record.
    	MRS. BLACKBURN.  Thank you.
    	MR. DEAL.  Thank you both.
    	MR. KETRON.  And, do I send that back to your office, Mr.
    Chairman?
    	MR. DEAL.  Either to Congresswoman Blackburn's office or to
    my office, either one will be sufficient.
    	Thank you both.
    	MR. KETRON.  You are quite welcome.
    	MRS. BLACKBURN.  Thank you.
    	MS. ROWLAND.  Thank you, Mr. Chairman.
    	MR. DEAL.  I will now ask our second panel if they would
    come forward.
    	Gentlemen, we are pleased to have you here, let me introduce
    you to the audience.  First of all, we have Mr. Darin J.  Gordon,
    who is the Deputy Commissioner of the Bureau of TennCare here
    in the State of Tennessee, and we have Mr. Dennis G. Smith, who
    is the Director of the Center for Medicaid and State Operations at
    Centers for Medicare and Medicaid Services, in Washington.
    	Gentlemen, we are pleased to have you here, and we'll start
    with you, Mr. Gordon, for your opening statement.

    STATEMENTS OF DARIN J. GORDON, DEPUTY COMMISSIONER, BUREAU OF TENNCARE; AND
    DENNIS G.  SMITH, DIRECTOR, CENTER FOR MEDICAID AND STATE OPERATIONS, CENTERS
    FOR MEDICARE & MEDICAID SERVICES

    	MR. GORDON.  Thank you, I'd like to thank Congressman
    Blackburn and the Chairman for having us here today to provide
    testimony on this important issue.
    	Just to give you a little background on TennCare in our State,
    we are a program, Medicaid program, that looks very similar to
    other Medicaid programs.  We serve low-income children,
    pregnant women, and the disabled.  We serve, approximately, 1.2
    million people across the State, and we operate with,
    approximately, a $7 billion budget.  It should also be pointed out
    that we are also a State that functions with 100 percent managed
    care.
    	Today, TennCare does not provide eligibility entitlement
    benefits to Medicaid enrollees.  As you are well aware, there are
    Federal laws prohibiting those entitlement benefits, as well as the
    fact that we have our Tennessee law that requires proof of
    residency within the State as well.
    	As you mentioned previously, some of the requirements in the
    DRA that added and gave specificity to the types of documents
    people can use as proof of citizenship, our State has been able to
    look at what we had been doing and make very minor
    modifications in order to comply with that requirement.
    	I would like to thank the Chairman and this committee for their
    help in clarifying some aspects of the DRA, with regards to the
    dually eligible individuals and those individuals with SSI, that
    helped tremendously, and we thank you for that.
    	We do also want to point out, as I'm sure you've heard from
    other States, there are still some limited circumstances in which
    individuals in, primarily, rural or mountain areas that aren't born in
    hospitals, in which case there are still some--these are U.S.
    citizens, there is just some further comments on how to better
    address proof of citizenship in those limited circumstances, and we
    appreciate the Committee and CMS' help in trying to get those
    clarifications.
    	The fact with the DRA coming out has not changed that illegal
    immigrants are not eligible for entitlement benefits on our
    program.  I need to point out that there is a law, as has been
    mentioned on this point, that does require the State to provide
    reimbursement to our hospitals for the emergency care to those
    illegal immigrants that would otherwise have been eligible for our
    program if they had U.S. citizenship.  We do not consider this
    reimbursement eligibility for our program, nor do we provide
    eligibility to our program just due to the fact that they are eligible,
    hospitals are eligible for the reimbursement for the services they
    provide.
    	It should also be noted that TennCare takes a strict
    interpretation of the definition of emergency services, as is
    required by this mandate.  Medicaid only provides reimbursement
    for the emergency episode itself.  We do not provide
    reimbursement to the providers for any follow-up care.
    	And, I should also point out that this is only reimbursement to
    hospitals for those illegal immigrants who fall into existing
    Medicaid categories, for example, if they are aged, blind, or
    disabled, or a pregnant mother, and meet income and resource
    requirements.  So, it may not fully encompass, the reimbursement
    that we provide may not fully encompass other issues that hospitals
    see with regards to illegal immigrants.
    	Within our program, just to put it in perspective at the
    Tennessee level, looking at the month of July, and we cover about
    1.2 million people as I said previously, in the month of July we
    provided reimbursement for 62, emergency services for 62 illegal
    immigrants to our State's hospitals.  The amount of reimbursement
    for the services that these people received amounted to $1.7
    million over the full treatment of their emergency condition.
    	Because of the very nature of emergency episodes, it should be
    pointed out, though, that single cases could easily eclipse the total
    reimbursement we pay for these 62 individuals.  For example, an
    individual burned in a car accident could cost upwards of $2
    million.
    	However, we primarily see reimbursements related to labor and
    delivery, that's primary.  If you look at the illegal immigrants, the
    emergency services that we get requests for reimbursement for, it's
    primarily in that area.  And, it's also important to point out, which
    was referenced earlier, is that that child, when born, is a U.S.
    citizen and is entitled to 12 months of Medicaid eligibility
    coverage from that point forward, and it's also important to
    emphasize in that instance the need to provide the neonatal care
    immediately following delivery to ensure that that child does not
    have complications that cost the State and the Federal government
    more money than it would have otherwise, if they had received that
    proper follow-up care.
    	I should also point out that, as I've mentioned earlier, that the
    hospitals do not receive reimbursement for any of those individuals
    that wouldn't have met Medicaid eligibility criteria.  So, there will
    be some unreimbursed costs due to the fact that hospitals are
    unable to turn away those people seeking care in the emergency
    room that they do not receive funding from Medicaid on, and I'm
    sure the hospitals and other members of the panel will probably
    speak to that.
    	To remove funding from what Medicaid currently pays for,
    would again put additional unreimbursed cost burdens on the
    hospitals, even though ours is limited in the whole scope of what
    unreimbursed costs that hospitals incur, it is something to take into
    consideration.
    	I also need to point out that in our State we do not currently
    have a disproportionate share hospital payment, and I'm sure the
    hospitals will definitely speak to that.  Usually, many States would
    use that to help offset some of that uncompensated care that those
    hospitals incur, including more than likely costs that they would
    incur related to treatment to those non-Medicaid-eligible illegal
    immigrants.
    	In conclusion, the Federal mandates placed on State Medicaid
    programs puts us in a precarious position of balancing the demand
    for the Federal government with fiduciary responsibility of the
    State of Tennessee.  The State Medicaid program, we are in a
    difficult position, as I see you all are as well.  On one hand, we
    must comply with Federal requirements to pay for emergency care
    for illegal immigrants, and on the other hand we must live within
    the State's limited resources to address the healthcare needs of our
    own citizens.
    	Medicaid is a payer, not a direct healthcare provider.  A s a
    result, the Federal mandates related to the illegal immigrant
    population further stretches limited State resources.  The Federal
    government should examine ways to relieve some of these
    financial pressures these mandates place on States' healthcare
    systems, and I understand it's a difficult situation, I know we
    provide services only in emergency cases, but it's something that
    the States are further stretching their limited resources to try to
    accomplish.
    	Thank you.
    	[The prepared statement of Darin Gordon follows:]

    PREPARED STATEMENT OF DARIN J. GORDON, DEPUTY COMMISSIONER, BUREAU OF TENNCARE

    	Good morning.
    	I would like to thank Congressman Blackburn and the
    members of the Energy and Commerce Committee for inviting
    TennCare to provide testimony on the impact of illegal
    immigration on our state's Medicaid program.  It is a pleasure to
    be with you today.
    	TennCare is Tennessee's expanded Medicaid program,
    providing health care coverage to approximately 1.2 million
    Tennesseans with a $7 billion budget.  Today, our program is
    much more like traditional Medicaid programs across the country,
    largely serving low-income children and pregnant women and the
    disabled.
            Current Medicaid eligibility includes a requirement that an
    individual prove U.S. citizenship and Tennessee state residency
    before Medicaid entitlement benefits are available.  Illegal
    immigrants are not eligible for full Medicaid entitlement benefits
    in Tennessee.  Under federal law (42 U.S.C.A.  1396b(v)) no
    payment may be made to a State for medical assistance furnished
    to an illegal immigrant.  An illegal immigrant is an immigrant who
    is not lawfully admitted for permanent residence.
            There is one exception in federal law.  Payment shall be made
    for care and services that are furnished to an illegal immigrant only
    if such care and services are necessary for the treatment of an
    emergency medical condition of the individual, and such care and
    services are not related to an organ transplant procedure.
    Therefore, TennCare provides reimbursement to hospitals for
    emergency healthcare services to illegal immigrants who would
    otherwise qualify for Medicaid.
            According to federal regulations,  the term "emergency
    medical condition" means a medical condition (including
    emergency labor and delivery) manifesting itself by acute
    symptoms of sufficient severity (including severe pain) such that
    the absence of immediate medical attention could reasonably be
    expected to result in-
            (A) placing the patient's health in serious jeopardy,
            (B) serious impairment to bodily functions, or
            (C) serious dysfunction of any bodily organ or part.

            Emergency Medicaid coverage is initiated in Tennessee when
    an application is filed with the state Department of Human
    Services.  Typically, the emergency has already occurred and
    Medicaid is reimbursing the hospital for the emergency treatment
    costs associated with the care already provided.  An illegal
    immigrant receiving emergency medical services must meet the
    same income and resource standards as any other Medicaid
    enrollee.  Examples of emergencies that trigger eligibility are
    childbirth, car accidents, heart attacks and stroke.  The
    reimbursement of emergency services is covered for the time the
    qualified individual is admitted to the hospital only.  No follow-up
    treatment or care is paid for by Medicaid.
            Using state and federal funds to pay for emergency healthcare
    for illegal immigrants places real burdens on state governments in
    addition to the entire healthcare delivery system.  Our program's
    experience can offer some insight into the effects of illegal
    immigration in Medicaid programs and its effects on Tennessee's
    health care providers.
            Tennessee's Medicaid program experience has been that this
    federal mandate involves an extremely small number of individuals
    compared to our program's total population of 1.2 million people.
    For example, in July 2006, TennCare was required under federal
    mandate to pay for 62 illegal immigrants' emergency care services.
    The total combined cost for these 62 individuals was
    approximately $1.7 million.
            However, it is also important to note that because of the nature
    of an emergent episode, one individual's cost can easily exceed the
    cost of treating these 62 individuals in any given month.  In
    addition to these month-to-month cost fluctuations, there is also the
    potential for overall increases in emergency care costs for illegal
    immigrants should the illegal immigrant population continue to
    grow.
            The vast majority of illegal immigrants who receive emergency
    Medicaid are pregnant mothers entering the hospital emergency
    room in active labor.  The children are born U.S. citizens and
    immediately qualify for full Medicaid benefits for the first year of
    their lives.  The cost of providing coverage for labor and delivery
    services for these illegal immigrants must be weighed against the
    fact that the provision of this service may reduce birth
    complications and subsequent costs that the Medicaid program
    would incur caring for an infant with health problems resulting
    from such complications.
            Medicaid programs must also recognize the circumstance from
    which hospital providers cannot escape.  Federal emergency
    medical treatment and active labor act (EMTALA) regulations
    require hospitals to provide emergency medical treatment to
    anyone regardless of ability to pay or citizenship status.  The cost
    of providing uncompensated care to illegal immigrants today is
    offset by required Medicaid reimbursement for a small subset of
    that population.  Medicaid does not reimburse hospitals for
    emergency care provided to all illegal immigrants, but only for
    those who meet all other Medicaid eligibility criteria except
    citizenship.
            Therefore, hospitals are bearing the total cost of
    uncompensated emergency care to illegal immigrants that do not
    qualify for Medicaid reimbursement.  To remove the funding that
    providers receive from the Medicaid program would result in
    additional unreimbursed costs for hospitals.
            In many states, disproportionate share hospital payments
    (DSH) are used to offset unreimbursed cost to hospitals.  DSH
    payments are federally matched dollars that help offset the cost of
    uncompensated healthcare provided by hospitals.  When TennCare
    was created in 1994, Tennessee's DSH allotment at the federal
    level was removed because it was believed the program would be
    able to cover the uninsured population and remove most, if not all,
    of the charity care experienced by the hospitals.  However, due to
    rapid growth, the program quickly closed to the uninsured without
    a reinstatement of DSH payments to hospitals.
            Now that TennCare is aligned with more traditional Medicaid
    programs, we believe that DSH payments are once again
    appropriate mechanism for uncompensated care reimbursement to
    hospitals.  Tennessee does not have the flexibility that almost all
    other Medicaid programs have in offering a mechanism to help
    offset increases in uncompensated care.  TennCare is allowed to
    offer a fixed amount in essential access payments (EAP) to a
    limited number of hospitals treating the majority of Medicaid
    enrollees.
            This limited supplemental pool plan does not afford Tennessee
    hospitals the means to address the escalation of uncompensated
    care costs that DSH allotments allow other states.  Healthcare
    utilization, the decline in private sector health care benefits, in
    addition to a number of other factors, leave hospitals facing an ever
    increasing uncompensated care burden and no mechanism to fairly
    address the increased costs to Tennessee.
            Finally, Medicaid programs often receive criticism from
    taxpaying citizens who are concerned that state funds are directed
    away from providing healthcare assistance to legal residents and
    toward paying for illegal immigrant emergency care.  The federal
    mandate places state Medicaid programs in a precarious position of
    balancing the demands of the federal government with a fiduciary
    responsibility to Tennessee taxpayers.  Ultimately, all taxpaying
    U.S. citizen and health insurance consumers bear the healthcare
    costs to provide these services for illegal immigrants.  Tax dollars
    are spent to provide direct reimbursement to hospitals for
    emergency Medicaid for those illegal immigrants who qualify for
    such assistance, while the costs of caring for other illegal
    immigrants are passed on to consumers indirectly in the form of
    higher costs for healthcare services that ultimately results in
    increased health insurance premiums.
            In final summary, as a state Medicaid program we are in a
    difficult position.  On one hand, we must comply with the federal
    requirement to pay for emergency care for illegal immigrants and
    on the other hand, we must live within the state's limited resources
    to address the healthcare needs of our own citizens.  Medicaid is a
    payer, not a direct healthcare service provider.
            As a result, the federal mandates related to the illegal
    immigrant population further stretches limited state resources.  The
    federal government should examine options to relieve some of the
    financial pressures these mandates place on states' healthcare
    systems.
            Thank you.

    	MR. DEAL.  Thank you.
    	Mr. Smith.
    	MR. SMITH.  Thank you very much, Mr. Chairman.  It's a
    pleasure to be with you today, and I thank Mrs. Blackburn for
    inviting me back to Tennessee.  It's a great pleasure to be with you
    here today.
    	I do have a full statement for the record that has been
    submitted, and I'd like to take my time just to really kind of reflect
    on what we've heard here this morning.  And first, I was taken by
    Mrs. Blackburn's remarks about confronting these real problems
    and finding solutions, and I want to commend you for doing
    exactly that, because when you have faced a problem you took it
    on and you found solutions.
    	For 20 years now, an individual applying for Medicaid had to
    declare whether or not they were a citizen or a legal alien, in order
    to receive Medicaid.  For Medicaid, you were required to provide a
    Social Security number.
    	Ten years ago, in welfare reform, confronted the issue of legal
    aliens coming to the country and getting immediately on public
    assistance programs.  Applications actually being filled out in the
    country prior to even getting to the United States, applications for
    our public programs, getting on SSI, getting on Medicaid.
    Congress put a stop to that.
    	Now, if you are a legal alien coming to the United States, you
    cannot be eligible for Medicaid for a 5-year period of time.  The
    individual who brought you here has agreed in bringing you to the
    United States to be responsible for your care, including for your
    healthcare.  So, we found a solution to a problem that was very, I
    think, important to do.
    	In the Balanced Budget Act of 1997, Congress responded by
    providing over $100 million over a 4-year period of time to assist
    States with the cost of providing emergency room services to
    undocumented aliens, regardless of their Medicaid eligibility.
    	In the Medicare Modernization Act, again, Congress saw a
    problem, worked with the Administration, provided $1 billion over
    a 4-year period to provide direct payments to hospitals for the cost
    of care that they were not otherwise going to be paid for.
    	And now, in the Deficit Reduction Act, finding the solution
    that, again, to the documentation of citizenship, I think being very
    important to the American public, to assure them that the integrity
    of the public programs, in fact, are being upheld.
    	But, it went beyond that in the DRA, provided $150 million to
    the States for transformation grants to help them to reshape their
    Medicaid programs, to help them to deal with some of the issues
    and problems that they face, and to modernize their programs, and
    a $50 million grant program, specifically, Mr. Chairman, putting in
    there for the States to help them to establish alternatives to
    emergency room care, and I think that that is a very important
    piece as well, as we do know that our hospital emergency rooms
    are over-burdened providing great quality of care, but at the
    highest cost, that is, the most inefficient way to provide healthcare
    services.  We know this from States in a variety of different ways,
    again, finding those alternatives to the emergency rooms are very
    important.
    	So, I think that to begin with, to be commended for facing
    these challenges head on, and working together to find solutions.
    	I was also struck by the State Senator's remarks about how
    these things are interrelated.  And again, in healthcare we often
    know, if you touch one part of healthcare you have touched all
    parts of healthcare, because they are interrelated, and
    interdependent.
    	I think the issue of immigration reform is very similar.  The
    State Senator mentioned healthcare, but also corrections and
    education, and again, I think all of those things touching together
    do lead us back to those previous examples of doing
    comprehensive approaches, giving comprehensive solutions, and I
    want to end on that, that the Administration wants to work with
    you to find these comprehensive solutions, but again, to also
    congratulate you for taking them on, and facing what is in front of
    us.
    	I will mention very quickly on citizenship documentation,
    again, I thank the Chairman for all of his work in that area.  I think,
    again, we took a very balanced approach first and foremost
    protecting those American citizens who are eligible for Medicaid,
    to make certain that they do not lose their eligibility.  There are
    many different ways to help establish their citizenship, and we are
    working with the States, having provided guidance to them, and
    our regulations help to protect their Medicaid eligibility for
    citizens who, in fact, are eligible.
    	These solutions, again, I think are very balanced.  They work
    because we know they work in other areas.  Our approach is,
    basically, the Social Security Administration's approach, how they
    authenticate an individual's identity, how they authenticate an
    individual's citizenship.  These are not really new ways in terms of
    eligibility workers, eligibility workers who have worked for Social
    Security, worked in these other programs, are very familiar that
    you need to have an authentic document, you have to be able to
    have confidence in that document that is being presented to you, to
    have that, to be able to provide that eligibility.
    	That is why, again, we go through the hierarchy of
    documentation, to say this document is more reliable than that
    document.  That's why those things are important, to assure that
    those documents are authentic.  But, we do have other ways, again,
    to help preserve the ability for an individual who is currently on
    Medicaid to make certain there is time to find their appropriate
    documentation, so that their eligibility is not at risk.
    	Ways that the States have to share their databases to affirm
    citizenship and identity, States have a great deal of information
    about individuals.  They are able to share that information, again,
    to preserve someone who is a citizen to make certain their
    Medicaid is not jeopardized.
    	So, I think we have taken a very balanced approach, but again,
    have assured the American people the integrity of the program.
    We worked with you on these different areas that we have
    discussed, and look forward to working with you on
    comprehensive immigration reform as well.
    	Thank you, Mr. Chairman.
    	[The prepared statement of Dennis Smith follows:]

    PREPARED STATEMENT OF DENNIS G. SMITH, DIRECTOR, CENTER
    FOR MEDICAID AND STATE OPERATIONS, CENTERS FOR MEDICARE
    & MEDICAID SERVICES

            Thank you for inviting me to speak with you about the impact
    of undocumented immigrants on the Medicaid program and the
    health care delivery system and express the Administration's
    support for comprehensive immigration reform that increases
    border security, establishes a robust interior enforcement program,
    creates a temporary worker program, and addresses the problem of
    the estimated 11 to 12 million illegal immigrants already in the
    country.
            Medicaid is a partnership between the Federal government and
    the states.  While the Federal government provides financial
    matching payments to the states, each state is responsible for
    overseeing its Medicaid program, and each state pays a portion of
    its cost through a statutorily determined matching rate, currently
    ranging between 50 and approximately 76 percent.  The Centers
    for Medicare & Medicaid Services (CMS), which oversees the
    Federal responsibility for Medicaid, ensures states enforce
    Medicaid eligibility requirements.  Recently, CMS issued guidance
    and an interim final regulation to the states as part of the
    implementation of the Deficit Reduction Act of 2005 (DRA),
    which requires Medicaid applicants who declare they are citizens
    to document their citizenship and identity.
            CMS, in regards to the broader health care system, also
    enforces regulations that require hospitals to medically screen and
    provide stabilizing treatment or an appropriate transfer to any
    person seeking emergency care, regardless of payment method or
    citizenship status.

    Immigrants and Medicaid Eligibility
            The Personal Responsibility and Work Opportunity
    Reconciliation Act of 1996 (PRWORA) significantly changed the
    eligibility of non-citizens for Federal means-tested public benefits,
    including Medicaid and subsequently the State Children's Health
    Insurance Program (SCHIP).  This change, however, did not alter
    eligibility for undocumented and nonimmigrant aliens, who
    generally remain ineligible for non-emergency Federal benefits.
    As a general rule, only "qualified aliens" may be eligible for
    Medicaid and SCHIP coverage.  Qualified aliens include aliens
    lawfully admitted for permanent residence under the Immigration
    and Nationality Act.  Refugees, those granted asylum, and victims
    of a severe form of trafficking (as certified by the Office of
    Refugee Resettlement of the Department of Health and Human
    Services) among several other categories also may be considered
    qualified aliens.
      	Under PRWORA, states are required to provide Medicaid to
    certain qualified aliens who otherwise meet the eligibility criteria
    of the state's Medicaid program, unless subject to a five-year bar.
    This five-year bar applies only to qualified aliens who entered the
    United States on or after August 22, 1996 with some exceptions.
    Typically the bar applies to lawful permanent residents and aliens
    granted parole for at least one year.  Some qualified aliens are
    exempt from the five-year bar, including refugees, those granted
    asylum, and trafficking victims, among others.  A qualified alien
    who is honorably discharged from the military; on active duty in
    the U.S. military; or the spouse (including a surviving spouse who
    has not remarried) or unmarried dependent child of an honorably
    discharged veteran or individual on active duty in the U.S. military
    also is exempt from the five-year bar.
            However, the five-year bar and other eligibility restrictions do
    not apply to aliens who are applying only for treatment of an
    emergency medical condition.  Thus, all aliens - both qualified and
    non-qualified aliens (including undocumented immigrants) - may
    be eligible for treatment of an emergency medical condition,
    provided they otherwise meet the eligibility criteria (such as
    income level, for example) for the state's Medicaid program.

    CMS Issues Guidance on Citizenship and Identity Documentation for Medicaid
    Eligibility
            American citizenship or legal immigration status have, for
    many years, been a requirement for Medicaid eligibility.  However,
    previously, in many states applicants could assert their citizenship
    status by merely checking a box on a form.  (A number of states
    have long required their applicants to document citizenship,
    including New York, New Hampshire and Montana.)  The DRA
    now holds states financially responsible for Medicaid expenditures
    for individuals claiming to be United States citizens unless such
    individuals provide actual documentary evidence supporting their
    citizenship and identity.  This new requirement applies to new
    applications for Medicaid eligibility and re-determinations
    beginning July 1, 2006.
            In order to give states some initial guidance on the
    implementation of this provision, on June 9, 2006 CMS issued a
    State Medicaid Director letter.  On July 12, 2006 the Department
    published an interim final regulation for states to implement this
    new requirement.  Comments on the interim final rule are due on
    August 11, 2006.  We expect to publish a final rule shortly.
            The law requires that a person provide evidence of both
    citizenship and identity.  In some cases, a single document will be
    enough to establish both citizenship and identity, such as a U.S.
    passport.   However, if secondary documentation is used to
    establish citizenship, such as a birth certificate, the individual will
    also need evidence of his or her identity.  Once citizenship has
    been proven, it need not be documented again with each eligibility
    renewal unless later evidence raises a question.
            The law specifies certain forms of acceptable evidence of
    citizenship and identity and provides for the use of additional
    forms of documentation as established by Federal regulations,
    when appropriate.  If an applicant or recipient presents evidence
    from the listing of primary documentation, such as a U.S. passport,
    certificate of naturalization, or a certificate of U.S. citizenship, no
    other information is required.  When such evidence cannot be
    obtained, our regulations require the states to look to the next tier
    of acceptable forms of evidence.   However, a state must first seek
    documents from the primary list before looking to the secondary or
    tertiary lists.  Because individuals who receive Medicare and
    individuals who are on Supplemental Security Income (SSI) in a
    state using SSI for Medicaid eligibility purposes already have met
    certain documentation requirements, the regulation does not
    include new documentation requirements for these groups.  This
    exemption reflects the special treatment of these groups in the
    statute.
            At the time of application or re-determination, the state must
    give an applicant or recipient a "reasonable opportunity" to present
    documents establishing U.S. citizenship or nationality and identity.
    An individual who is already enrolled in Medicaid will remain
    eligible if he/she puts forth a good faith effort to present
    satisfactory evidence of citizenship and identity.  Applicants who
    despite their good faith effort are unable to present documentation
    should be assisted by the state in securing these documents.  States
    may use data matches with the State Data Exchange (SDX) or vital
    statistics agencies in place of a birth certificate to assist applicants
    or recipients to meet the requirements of the law.  As a check
    against fraud, states are also required to use currently available
    capabilities to conduct a match of the applicant's name against the
    corresponding Social Security number that was provided.  In
    addition the Federal government encourages states to use
    automated capabilities to verify citizenship and identity of
    Medicaid applicants.  We specifically asked for public comment on
    whether there are other electronic data systems that should be
    identified to assist states in determining an individual's citizenship
    or identity.
            As with other Medicaid program requirements, states must
    implement an effective process for assuring compliance with
    documentation of citizenship in order to obtain federal matching
    funds, and effective compliance will be part of Medicaid program
    integrity monitoring.  In particular, audit processes will track the
    extent to which states rely on lower categories of documentation
    with the expectation that such categories would be used relatively
    infrequently and less often over time, as State processes and
    beneficiary documentation improve.  When future automated
    capabilities to verify citizenship and identity of Medicaid
    applicants becomes available, states also will be required to match
    for individuals who used third or fourth tier documents to verify
    citizenship and identity.  In the meantime, states must ensure that
    all case records within this category are identified so that they may
    be made available to conduct these automated matches.  States will
    receive the normal 50 percent match for administrative expenses
    related to implementation of the new law.
            The law also requires that the Secretary develop an outreach
    program which is intended to educate individuals who are likely to
    be affected by the requirements of this provision of the law.  CMS
    has already conducted numerous teleconferences with states and
    other organizations interested in this provision.  In addition, we are
    developing an outreach plan that provides strategic direction and
    coordination for an integrated education and outreach program to
    inform states, Medicaid recipients, and others of these new
    documentation requirements.  This initiative will be implemented
    to promote active and informed involvement by states and people
    with Medicaid in providing beneficiaries the necessary information
    about the new documentation requirements.  The plan will ensure
    that all stakeholders know of the new requirements, understand the
    documents which satisfy these requirements, assist the streamlined
    implementation by states, and ensure continued uninterrupted
    access to Medicaid for citizens.

    EMTALA
            Regarding the broader health care system, CMS enforces the
    1986 Emergency Medical Treatment and Labor Act (EMTALA).
    Under EMTALA, hospitals have obligations to any individual,
    regardless of citizenship, who requests treatment for a medical
    condition.  EMTALA was designed to ensure that people will
    receive appropriate screening and emergency treatment regardless
    of their ability to pay.
            CMS' regulations implementing EMTALA require that
    hospitals with dedicated emergency departments provide an
    appropriate medical screening examination to any person who
    comes to the hospital emergency department and requests
    treatment or examination of a medical condition.  They also
    require that these hospitals provide an appropriate medical
    screening examination to any person who presents himself on
    hospital property requesting evaluation or treatment of an
    emergency medical condition.  In both cases, a request may be
    made by another individual on behalf of the person for whom
    examination or treatment is sought, or a request can be considered
    to have been made if a prudent layperson believes that based on the
    behavior of the individual an emergency medical condition exists.
    If the examination reveals an emergency medical condition, the
    hospital must also provide either necessary stabilizing treatment or
    arrange for an appropriate transfer to another medical facility.
            EMTALA applies to all Medicare-participating hospitals with
    dedicated emergency departments and applies to all individuals
    regardless of immigration status who present themselves
    requesting examination or treatment of a medical condition.
    Hospitals with specialized capabilities have a responsibility under
    EMTALA to accept appropriate transfers regardless of whether the
    hospital has a dedicated emergency department.  A hospital that
    violates EMTALA may have its ability to participate in Medicare
    terminated and may be subject to civil penalties of up to $50,000
    per violation.  An individual who has suffered personal harm and
    any hospital to which a patient has been improperly transferred and
    that has suffered a financial loss as a result of the transfer are also
    provided a private right of action against a hospital that violates
    EMTALA.
            Hospitals also are required to maintain lists of physicians who
    are on call for duty after the initial examination to provide
    necessary stabilizing treatment.  Hospitals have discretion to
    develop their on-call lists in a way that best meets the needs of
    their patients requiring services required under EMTALA.
            Under CMS' regulations, EMTALA does not apply after an
    individual has been admitted for inpatient hospital services, as long
    as the admission is made in good faith and not in an attempt to
    avoid the EMTALA requirements.
            Section 945 of the MMA required the Secretary of Health and
    Human Services to establish a technical advisory group (TAG) to
    review EMTALA policy, including the regulations and interpretive
    guidance outlining hospitals' responsibilities under EMTALA.
    This TAG, which includes hospital, physician and patient
    representatives, has already met 4 times.  The TAG will complete
    its deliberations and submit a report of its findings and
    recommendations to the Secretary by October 2008.

    Conclusion
            Thank you again for this opportunity to discuss the impact of
    undocumented immigrants on Medicaid and the health care
    system.  I would also like to take this opportunity to once again
    express the Administration's support for comprehensive
    immigration reform.  I would be happy to answer any questions
    you might have.

    	MR. DEAL.  Thank you, Mr. Smith.
    	Let me sort of set the stage for my questions.  For those of you
    who have not followed this discussion over the last decade or so,
    as we have dealt with the issues, especially those alluded to with
    Mr. Smith, Medicaid had been one of those areas where we really
    had not put the same kind of requirements in terms of verification
    of eligibility, as you alluded to that we are currently in, Social
    Security, SSI, and Medicare.
    	And, as you heard in my opening statement, we found as we
    started looking into this that 46 States, including the District of
    Columbia, making 47 major jurisdictions, used what was called
    "self declaration of eligibility."  Now, let me just sort of walk you
    through, and I know the two gentlemen here at the table understand
    this in great detail, but for those of you in the audience let me walk
    you through what that really means.
    	For years, I had been hearing the complaints from my
    constituents that people that they thought probably were not
    eligible for Medicaid were showing up with Medicaid cards at the
    doctor's offices and other healthcare settings.  I have somewhat
    facetiously made the comparison that it was the substitute for what
    we all used to hear about the complaints about Food Stamps with a
    person in front of them at the checkout line at the grocery store
    who had paid with Food Stamps and they thought that was an
    abused program, it now sort of migrated into the healthcare arena
    through Medicaid.
    	For years, I kept asking my people at the State level, and at the
    Federal level, do you verify the immigration status of people who
    apply for Medicaid?  The answer kept being, yes, we do.
    	It took me a while to realize I was asking the wrong question.
    The first question is always, are you a citizen?  There was no
    verification of your answer to that.  You could say, yes, wee, si,
    whatever language you choose to use, if it was an affirmative
    response, there was no verification required, and that's what we
    call self-declaration of eligibility.
    	Now, I bet I could suggest to this audience that there are a
    number of Federal and State programs that have eligibility
    requirements, and if all that was required to get on the rolls of
    receiving those benefits was for you to say you are eligible.  I think
    you would say that would make a mockery of the system.  That's
    what we had in Medicaid, and that's why the reforms that we put
    in place about requiring documentation of eligibility were so
    significant.
    	Why?  Because what we found was, when States like mine
    asked the questions of individuals that appeared to be, perhaps, not
    eligible, they were accused of profiling.  They were threatened
    with lawsuits by the Civil Rights Division, that if you do this and
    ask for documentation of only selected individuals who you
    suspect might not be a citizen, then you are violating the Civil
    Rights rules because you should treat everybody equally.
    	So, if you hear anybody complaining about the fact that grand
    momma doesn't have a birth certificate, she's been on Medicaid,
    and now they are going to kick her off.  First of all, as Mr. Smith
    said, that's not true, and there are procedures to go by to get those
    proper documentations.
    	We've heard from the opponents of this solution that it is going
    to just be so cumbersome and difficult.  I guess first of all, Mr.
    Gordon, I would ask you, since you are in the process and in the
    position of having to implement this reform, what has been your
    sense of being able to enforce this provision at the State level?
    	MR. GORDON.  Actually, here in Tennessee at least, and,
    obviously, I can't speak to other States, but with our experience we
    currently contract with our State Department of Human Services
    that would do this for us.
    	Initially, there was some concern, but I believe the clarification
    around Social Security eligible individuals and the Medicare
    populations really relieved the vast majority of our concerns.
    	Speaking with the agency, the Commissioner of that agency,
    just yesterday, just following up and seeing how that's progressing,
    they had to modify some of their processes in how they retained
    the documentation and trying to do that through, just from a pure
    filing and imaging type process.  But, other than that, they felt that
    this was something that they could implement and comply with.
    	MR. DEAL.  Well, that's the experience that my State people
    are telling me as well.
    	Mr. Smith, let me ask you to amplify on this, and in so doing
    would you talk about the question that the Representative and the
    Senator alluded to for States like Tennessee that currently are still
    issuing driver's licenses without the verification of citizenship for
    the issuance of that license.  How do States like that fit into the
    presentation of the necessary documentation for Medicaid
    eligibility?  And, what validity, if any, do you place on documents
    like that kind of driver's license?
    	MR. SMITH.  Yes, Mr. Chairman.
    	Again, to step back for a second, the States do the eligibility
    determinations for Medicaid.  Many States, it is not the Medicaid
    agency actually doing the determination, but a Department of
    Social Services, or an enrollment broker, or someone else like that.
    	The guidance that we have given to the States is very specific,
    in terms of making certain the State understands that they need to
    rely on documents that are authentic and verifiable.  The States
    should also be doing cross matches of Social Security numbers, to
    assure, again, that when you are presented with information the
    State is at risk to make certain that information, in fact, is correct,
    and that they are relying on documents that are correct and
    authentic.
    	So, if the State does not have confidence in any type of
    document, then they should be doing something else to move
    beyond that then to request something else.
    	There are documents, again, in the hierarchy, there are some
    documents that provide both citizenship and identity, like a
    passport, but in many cases, in most cases, States are going to be
    looking for probably a combination of documents, a birth
    certificate that provides the citizenship status, and another
    document that provides the identity.  So, you need to look at both
    of them together.
    	But, the States can also do cross matching of their own
    databases, with other databases, with other States as well, but
    again, what we would be looking for in coming behind the State is,
    did you make the determination of eligibility on information that
    was authentic and that you had confidence that that was correct
    information.
    	So, a State should not accept information that they don't have
    confidence in.  Again, we have said, do not accept copies.  Do not-
    -you know, there are, and again, this is not any different than
    guidance that Social Security uses, they would not accept a copy of
    a document.  So, it lays out, I think, very clearly what the States
    should do in situations, if you are presented with information that
    you don't have confidence in you should be looking out for
    something else as well, you should be cross matching the Social
    Security number, et cetera.
    	MR. DEAL.  In the letter you've sent to State Medicaid
    Directors, it goes into great detail about outlining the processes, the
    steps, and the kinds of documents that you would be looking for,
    for that verification.  Is that right?
    	MR. SMITH.  Yes, Mr. Chairman.
    	MR. DEAL.  All right.
    	MR. SMITH.  Yes, sir.
    	MR. DEAL.  I don't think we need to go into all the details of
    that for purposes of this hearing, because it is an official document
    that has been sent to all State verification agencies.
    	I do think, though, however, it is going to require diligence.
    Both at the Federal level as you go behind and check States as to
    their verification and certification processes.  My understanding is
    that if you find that they have not complied with this change in the
    law then they are subject to a penalty in the form of losing
    Medicaid matching money from the Federal government.  Is that
    correct?
    	MR. SMITH.  That's correct, Mr. Chairman.  The law requires to
    participate, to get FFP from the Federal government, you must
    come into compliance.
    	But also, at the individual level, again, where you have an
    individual on an audit review, we will be looking for that
    information as well, that you've complied programmatically in
    implementing them, but also on an individual basis you want to
    make certain, as Darin alluded to, you have to make sure the file is
    complete also, to when they are looked behind, again, audits are
    generally a sample of files, whether it's eligibility or at a provider
    level, you are looking at a sample.  So, you want to make certain
    that the file is complete, again, that you have relied on documents
    that are authentic and that you have confidence in.
    	MR. DEAL.  As I understand it, there is a 12-month phase in on
    this program, so that people who are currently under the Medicaid
    program, that may not have the documentation that the new change
    in the statute requires.  The States will have a 12-month period in
    order to provide that documentation.  Is that correct?
    	MR. SMITH.  It is correct for individuals, Mr. Chairman, in two
    different ways.  One, if you are an applicant, if you are applying
    for the first time, then you need to provide the documents at tine of
    application.
    	But, in Medicaid, we also have what is called redetermination,
    so no less than every 12 months a State needs to redetermine that
    individual's eligibility.  States vary in terms of that amount of
    time, and how frequently they redetermine.  So, come September
    you are looking at all new applicants, and then those individuals
    that were up for redetermination in September, et cetera, as you
    move forward every month.
    	In terms of the individual, if they are on Medicaid currently,
    and again, we have exempted people on Medicare, we've
    exempted people on Social Security, they do not have to do this
    again.  They do not have to--
    	MR. DEAL.  Because they've already done that.
    	MR. SMITH.  --that is correct.
    	But, if you are not in that exempt category, and you are on but
    you don't have the documents, then you have what is called a
    "reasonable opportunity." Again, the State will continue to have
    you enrolled into Medicaid, but give you a reasonable opportunity
    to provide that documentation, which again, is currently a standard
    in the Medicaid program.
    	MR. DEAL.  Mrs. Blackburn, I will yield you whatever
    remaining balance of my time, plus your time.
    	MRS. BLACKBURN.  Thank you, Mr. Chairman.  I appreciate
    that.
    	I do have several questions for each of you.
    	Let me stay with this verification issue for right now, if I may.
    Mr. Gordon, let me come to you first.  You said that you all,
    basically, are contracting with DHS--
    	MR. GORDON.  That's correct.
    	MRS. BLACKBURN.  --to handle all of this.  So, they are
    handling your verification process, and what documents are they
    using to verify the citizenship, residency, income limits, et cetera,
    of those applying for TennCare?
    	MR. GORDON.  Well now, based on the DRA, there's the list
    that are set forth that you go through the different phases.
    	MRS. BLACKBURN.  Right, and I agree with your statement that
    clear definition of who is responsible for what is helpful, and I
    think the DRA did do that.  But, prior to that, what were you
    doing?
    	MR. GORDON.  They will use similar types of documents.
    	MRS. BLACKBURN.  Okay.
    	MR. GORDON.  The retention of those documents would be
    checked at the individual check for those types of documents.
    	MRS. BLACKBURN.  Okay.
    	MR. GORDON.  But, there are other circumstances in which
    case--
    	MRS. BLACKBURN.  All right, and how are they obtaining the
    citizenship documents?
    	MR. GORDON.  Whenever the individual comes in to be
    checked for verification, they are asked to bring proof.
    	MRS. BLACKBURN.  Okay.  So, they have to bring the originals,
    no copies?
    	MR. GORDON.  I'm not clear whether or not it was at that point
    in time or at any point in time, whether or not it stipulated copy or
    original.
    	MRS. BLACKBURN.  Okay.
    	MR. DEAL.  But, it's clear now that the copy is now allowed,
    right?
    	MR. GORDON.  That's correct.
    	MRS. BLACKBURN.  Okay.
    	MR. DEAL.  Excuse me.
    	MRS. BLACKBURN.  Listen, that's great, and go ahead, Mr.
    Chairman, and add in.  I think this is something that we have, it
    speaks to what we hear as a lot of the anecdotal information that
    we hear, and what we want to hear from you is what you are
    dealing with so that it helps us in the decision-making matrix.
    	Okay.  So, and the reason I'm asking this, I had read and had
    kept an article that had run from the city paper here, where a
    woman, a Ms. Garner, with Department of Human Services, she's
    the Medical Policy Director and handles the TennCare enrollment,
    and speaking of the changes we were making in the DRA had said,
    well, it could backfire and harm our citizens who are really in need
    most.  And, as you've heard the Chairman say, and as Mr. Smith
    has said, you've got your reasonable opportunity to go through and
    present.  And so, it was interesting to me that that would be a first
    flush, and I was wanting to verify for the record what you had
    used, and then how you obtained what you had used.
    	MR. GORDON.  And, as I stated, the types, similar documents
    were asked for, again, as I alluded to in my remarks, there are
    circumstances, and I believe that might have been what she was
    referring to in rural settings where individuals are not born in
    hospitals, in which case, in earlier years, but part of your
    clarification helped in that area.
    	MRS. BLACKBURN.  Let me ask you this, we know that
    Georgia, New York, Montana, New Hampshire, have all had strict
    proof of citizenship for Medicaid eligibility, some for decades.
    And, they have not reported any problems with this.  Do you have
    people from TennCare, and from DHS, talking with these other
    States to see what their best practices are, and what protocols they
    are using, and what template they are working from?
    	MR. GORDON.  There are multiple State calls going on through
    various associations, which I'm sure you are familiar with, whether
    it be the NGA, or whether it be the State Medicaid Directors, that,
    basically, walk through this, and there's also some of those calls
    orchestrated by CMS themselves, in which case we participate.
    	MRS. BLACKBURN.  Okay.  Dr. Smith, I always appreciate your
    incites, let me say that, and I appreciate you diligence in working
    with us to find answers to whether it's Medicare or Medicaid, but
    any of the CMS web of services that exist.  Let me ask you,
    Representative Rowland had spoken in her testimony about the
    verification process, and some of the concerns there.  Would CMS
    endorse the use of the Employer Verification Program for
    verifying legal residency status?  Would they, do you think they
    would endorse that/
    	If we look at having something that is a nationwide template,
    that can be used by the States, if we say the Federal government is
    going to address a part of this.  If some of the States were to accept
    some things that were mandated, if you will, would CMS endorse
    the use of that program?
    	MR. SMITH.  I'm not familiar enough with the Employer
    Verification Program.  I think this would be an Administration
    position, rather than a CMS position, and in the development of the
    guidance and the regulation to the States, we certainly had input
    from Homeland Security.  I think this is an area that they are the
    ones who have the expertise in.  But, I think it's consistent with,
    again, the discussions that are going on of having a reliable system
    that everybody knows and everybody understands that it's reliable,
    but again, it is one that is uniform as well, because it is difficult.
    You do it for, this program has its set of rules, another program has
    another set of rules.  I think in this area there is a lot of discussion
    about how do you get this to--you have the confidence, but also
    easier to administer because everybody knows what those rules
    are.
    	MRS. BLACKBURN.  So, basically, uniformity is what you are
    looking for, rather than a universal program.
    	MR. SMITH.  I think that's correct.
    	MRS. BLACKBURN.  Okay.
    	MR. SMITH.  And again, that would be an Administration
    position.
    	MRS. BLACKBURN.  All right, great.
    	I want--the reasonable opportunity for reverification, let me go
    to that for just a second.  How long do you all allow at the State
    level for that?
    	MR. GORDON.  We get 12 months of eligibility, and beyond
    that I'm not--
    	MRS. BLACKBURN.  A full 12 months.
    	MR. GORDON.  --that's how much eligibility you get.  As far as
    the reasonable opportunity to show proof at that time of
    redetermination, I'm not sure exactly how much time we have
    allotted for that.
    	MRS. BLACKBURN.  Okay.  All right.
    	At the Federal level?
    	MR. SMITH.  I think reasonable opportunity is generally 45
    days.
    	MRS. BLACKBURN.  Forty-five days.
    	MR. SMITH.  But again, you are looking to the individual
    cooperating with you and helping you to find the documents that
    you are asking for.
    	MR. SMITH.  Okay, so Tennessee is much more lenient than the
    Federal standard.
    	MR. SMITH.  Well, in terms of the 12-month eligibility, that is a
    State decision of how long you are going to go out, but reasonable
    opportunity, these are sort of well established in the appeals and
    grievances decisions that Medicaid follows.
    	MRS. BLACKBURN.  Okay, great.
    	Mr. Gordon, let's look at the TennCare expenditures for illegal
    immigrants, and you mentioned last month you had, is it $1.2
    million, 62 individuals, $1.7 million in your testimony.  So, has the
    State reported any TennCare expenditures for illegal immigrants to
    CMS, and were they only Section 1011 reimbursements, or how
    did that work?
    	MR. GORDON.  In the $1.7 million, just to clarify, is all the care
    that we ended up reimbursing to the facilities for those 62
    individuals.
    	MRS. BLACKBURN.  Okay.
    	MR. GORDON.  So, it didn't all $1.7 occur in the month of July,
    some of them may have had such conditions that may have
    spanned a little bit more than a month.
    	So again, it varies month to month.  I think in many months we
    only see single digit numbers of individuals that providers are
    seeking reimbursement for.
    	I would tell you that, I would say on an annual basis you'd be
    looking at probably about $15 million total annually.
    	MRS. BLACKBURN.  So, $15 million is what you are billing
    back to CMS for illegal immigrant healthcare.
    	MR. GORDON.  For the emergency services.
    	MRS. BLACKBURN.  Emergency?
    	MR. GORDON.  Yes.
    	MRS. BLACKBURN.  What about non-emergency that comes
    into--
    	MR. GORDON.  We don't provide any non-emergency care.
    	MRS. BLACKBURN.  Okay.  All right.
    	And, that is all Section 1011.
    	MR. GORDON.  I'm not familiar with Section 1011 with
    specificity.
    	MRS. BLACKBURN.  Okay, emergency.
    	MR. GORDON.  Yes.
    	MRS. BLACKBURN.  That's emergency.
    	MR. GORDON.  Yes.
    	MRS. BLACKBURN.  Okay.
    	MR. SMITH.  If I may, Mrs. Blackburn.
    	MRS. BLACKBURN.  Yes, please, go ahead.
    	MR. SMITH.  One thousand and eleven came specifically out of
    the Medicare Modernization Act.
    	MRS. BLACKBURN.  Right.
    	MR. SMITH.  So, that is all Federal dollars.  The States aren't
    participating in that.  So, CMS is directly reimbursing hospitals out
    of Section 1011, versus the emergency services reimbursed under
    Medicaid that I think the $1.7 Mr. Gordon was referring to is.
    	I also want to emphasize again, there is a definition of
    emergency services.  So, going in for routine medical care would
    not qualify, and also it would be for an individual who would
    otherwise be eligible for Medicaid.  So, those are constraints as
    well.
    	MRS. BLACKBURN.  Well, and that's why I was coming back to
    Mr. Gordon on the non-emergency, because the anecdotal that we
    are hearing, and we can talk about this with the hospitals in a few
    minutes, is that there is a good bit of that non-emergency that is
    coming into those emergency rooms, and the Chairman spoke so
    well to that in his testimony, $340 for a routine emergency room,
    and then you are looking at the same thing could be treated for
    about $70 in a doctor's office, a physician's office.  And, we
    continue to hear this.
    	Now, $15 million, and TennCare's budget now is--
    	MR. GORDON.  Seven billion.
    	MRS. BLACKBURN.  --$7 billion?
    	MR. GORDON.  Yes.
    	MRS. BLACKBURN.  You know, then that doesn't sound like a
    whole lot, and so we've got a little bit of discrepancy in what
    anecdotally we're hearing and what you are saying, well, go ahead,
    clarify.
    	MR. GORDON.  One thing I would point out is, since we are
    only required to provide reimbursement in those emergency
    situations, that sometimes you do have situations that an individual
    presents at an emergency room that if in a normal circumstance
    that care could have been delivered at another setting the hospital
    will--an application will be sent in describing the emergency, we
    will have our Medical Director review that, and I will tell you,
    child delivery in an emergency room is probably not the most
    appropriate place for child delivery, yet that does occur and that is
    one of the areas that we are to cover.
    	MRS. BLACKBURN.  Okay.  Let me jump through a couple more
    questions.  My time is up, and I realize that, and I do still have
    some questions.
    	Mr. Gordon, Georgia is beginning to check W2s, to verify
    income for applying for Medicaid.  Is Tennessee doing something
    similar?
    	MR. GORDON.  We have, historically, checked with our labor
    and wage files that we collect in the State, for checking the
    income.
    	MRS. BLACKBURN.  Okay.
    	MR. GORDON.  As well as other data matches.
    	MRS. BLACKBURN.  Let me ask you this, too.  I know we've
    heard a good bit about this anecdotally, but in how many cases did
    people who were applying for TennCare claim that their official
    documents were unavailable?  And, what were the main reasons
    for that unavailability?  And then, in your reverification, how do
    you go back and check to see if those are truly unavailable?  Could
    you give me an idea of that?
    	MR. GORDON.  Well, I tell you, similar to what I was hinting
    toward earlier, especially, and again, most of it being addressed by
    covering most of those that are aged, that you have situations, as
    far as percentage, I couldn't tell you that off the top of my head,
    but I would tell you that it's situations where individuals were
    born, had delivered children with midwives or something usually
    earlier on in rural areas, in the mountain areas of our State, in
    which case some of those documents that were listed are not
    always available.
    	Based on the DRA, we'll have to encourage those people to go
    through the process of trying to obtain some of those documents.
    Otherwise, they cannot be eligible for our program, period.
    	MRS. BLACKBURN.  Okay.  And then, going back to your
    payouts, out of TennCare's $7 billion, how much was paid out for
    emergency or temporary TennCare for those who were either
    ineligible for the program, or couldn't pay for the care, or couldn't
    find their documentation?
    	MR. GORDON.  Again, we've always required some
    documentation for U.S. citizenship.  So, we wouldn't have let them
    on if they didn't have some documentation.  It may not have been
    included in the current list that's in the DRA, but we've required
    some proof of documentation.
    	MRS. BLACKBURN.  And, do you have any idea of what
    percentage of that was for illegal immigrants?
    	MR. GORDON.  No, because we wouldn't have let you on if you
    were not able to produce some proof of citizenship.
    	MRS. BLACKBURN.  Okay.
    	MR. GORDON.  So, we wouldn't have had any expenditures if
    you were--again, going back to requiring that they prove
    something, while it may not be on the DRA list, but we used other
    sources of documentation.  So, again, with the list we'll be asking
    more specific questions.
    	MRS. BLACKBURN.  Okay.  Has TennCare ever used
    documentation not accepted by CMS or Social Security to
    document citizenship?
    	MR. GORDON.  Actually, one of the things, I think, let me,
    under the DRA, what was previously being accepted, and I think
    this is not unique to Tennessee, I think it's safe to say in many
    States, there wasn't one set standard on what should be considered
    acceptable for citizenship.
    	So, we were looking for different types of documents, again,
    some of which didn't fit with the list currently today.
    	I would tell you, seeing that we use Department of Human
    Services that also interacts with Medicare and Social Security on a
    regular basis, that might be part of why our transition may not be
    as difficult as others who are used to some of those processes, and
    have incorporated some of those processes in determining
    eligibility for other programs that people may be eligible for.
    	MRS. BLACKBURN.  Okay.  Mr. Smith, anything to add?
    	MR. SMITH.  I think we've, again, the importance of what the
    DRA did to instill the confidence that public programs are truly
    being used appropriately by U.S. citizens, protecting those who are
    most vulnerable, those on Medicare, those on SSI, are exempt from
    it.  I think we achieved that balance, and again, I think the
    experiences that I've described in looking at this in a
    comprehensive approach sort of leads us down that path again,
    because I think we were very successful, and again, you all are to
    be commended for coming up with the solutions that you offered,
    whether in 1011 or the other special payments to meet the needs
    that we have.
    	MRS. BLACKBURN.  Let me ask you this, Mr. Smith, before I
    leave you.  Looking at the 1011 payments, and Mr. Gordon might
    have a little bit on this, too, and we heard from our State Senator
    and our State Rep, and finding a solution on how to address this
    funding issue has to be a partnership situation with your local,
    State and Federal government, clearly defining, clearly working
    through this process.
    	So, Representative Rowland had said every town is a border
    town, so what about our local health departments, are you hearing
    from local health departments, does TennCare hear from them,
    about the impact on them?  Does CMS hear from them saying,
    what about Section 1011, can these local health departments access
    some of those funds?  Hence, those are Federal funds that are
    going directly to the hospitals and the care centers.
    	MR. SMITH.  I think this is an area, in particular, that we are
    still learning from and having the discussion with the hospitals.
    	For example, the billion dollars that Congress put in for the
    hospitals to meet this need, in some respects hospitals said, well,
    we don't want to get into verification of someone's status.  So, we
    need to continue to talk with the hospitals about how to strike the
    balance.
    	The billion dollars is specifically for undocumented, and it's
    not for people who are not undocumented.  It's not supposed to be
    just for anyone who walks in to the emergency room.  So, the
    billion dollars has a very specific purpose.
    	Hospitals have to tell us how they are using that in a way that,
    again, we know that the billion dollars that Congress put in there is
    being used for what it was intended for.
    	So, I think that dialogue is still continuing.  Many hospitals are,
    hospitals, for example, have taken on proxies in terms of using
    Social Security numbers, whether or not that is completely
    accurate or not is, again, still part of the dialogue.  I think the
    General Accountability Office has been looking at 1011 also.
    	So, I think you did the right thing, but how it's implemented
    and executed I think still takes a little bit of dialogue between CMS
    and the hospital.
    	MRS. BLACKBURN.  And, I appreciate that, because listening to
    Mr. Gordon, it seems that what I'm hearing him say is, well,
    TennCare feels we don't really have a problem with illegal
    immigration.  We had $1.7 million that was paid out in one month,
    and about $15 million total for a year for these services, many of
    which are child births.  Am I correct in restating that, sir?
    	MR. GORDON.  Except for the fact that I consider $15 million a
    lot of money, but other than yet, yes.
    	MRS. BLACKBURN.  Well, I do, too.  I consider it to be an
    incredibly large amount of money.
    	Looking at TennCare's budget of $7 billion, and then you start
    saying this is where our problem is, then my question is, if you all
    feel you do not have a problem with illegal immigration, and you
    are, basically, saying we have set some processes in place so this is
    not a problem, but we are hearing from our local governments that
    emergency rooms are full, that our health clinics, our community
    health centers are full, we've got a disconnect somewhere.
    	And, what I want to do is figure out where this disconnect is.
    Every dollar a taxpayer spends is a lot of money.
    	MR. GORDON.  And, I think maybe where some of that
    disconnect may come from is the fact again, we only cover those
    people that would--we only reimburse hospitals for those people
    that would otherwise have been eligible for our program.  That is
    not a very broad category.  So there, and again, I think hospitals
    will be better prepared to speak to that.
    	MRS. BLACKBURN.  One more question for you, and I have way
    over stayed my time, and we do have other panels, I would like to
    know if you have reverified or are in the process of reverifying
    individuals currently on TennCare going back to when TennCare
    was put in place in January, '95, and then coming up through the
    time that Tennessee exercised the additional leniencies in its
    driver's license policies, and coming forward with the DRA.  And,
    you can submit this in writing, I'm not going to put you on the spot
    to submit it right now, but I think, Mr. Chairman, it would be
    helpful for us to know what kind of reverification process you all
    plan to engage in to ensure CMS and the citizens, that those that
    are on the program, on TennCare, are legally in the country and are
    the individuals that are to be on that program.
    	MR. GORDON.  Absolutely.
    	MRS. BLACKBURN.  Thank you.  I appreciate it.
    	Mr. Chairman, I yield back, and thank you for your
    consideration.
    	MR. DEAL.  Let me just follow up very quickly.
    	Mr. Gordon, I'm sure you are not totally surprised, since your
    verification process did require some evidence of citizenship, but
    the documents don't correspond, as you indicated to the current
    standard.  I'm sure you are not going to be totally surprised to find
    that many of those documents you were relying on were fraudulent
    and forged documents.  You are not going to be surprised by that,
    are you?
    	MR. GORDON.  I would have no way of knowing whether or
    not they were or weren't.
    	MR. DEAL.  The reason I say that is, that document fraud is one
    of the biggest problems that we have in this country in every
    program.  I think that's what the challenge that Mr. Smith and his
    agency has is to try to get back to non-forgible documents.  Have
    that as the basis for certification of eligibility, and that's going to
    require cooperation at both the State and the Federal level, working
    together to achieve that goal.
    	One final question, Mr. Smith, is it not true that if Mr. Gordon,
    the Representative, or anyone from the State of Tennessee or any
    other State, wishes to make further comments that you are still in
    the comment period with regard to some of these issues?
    	MR. SMITH.  Mr. Chairman, you are correct, but we only have
    one more day.
    	MR. DEAL.  Oh, good thing I asked the question today then.
    	MR. SMITH.  Yes, sir, and we have received comments.
    	MR. DEAL.  Well, good.  Thank you.
    	Thanks to both of you for being here.
    	MR. DEAL.  I'll call our third panel to the front.
    	This panel is Mr. Richard Flores, who is Vice President of
    Revenue Cycle at LifePoint Hospitals here in Brentwood,
    Tennessee, Mr. Bob Duncan, who is Vice President for Advocacy
    and Government Relations of Methodist Healthcare-LeBonheur in
    Memphis, and Mr. Gary Perrizo, who is the Director of Patient
    Accounting, Department of Finance, at Vanderbilt University.
    	Gentlemen, we are pleased to have you here, and we will hear
    your opening statements beginning with Mr. Flores.

    STATEMENT OF RICHARD FLORES, VICE PRESIDENT OF REVENUE CYCLE OPERATIONS,
    LIFEPOINT HOSPITALS, INC.; BOB DUNCAN, VICE PRESIDENT FOR ADVOCACY AND
    GOVERNMENT RELATIONS, METHODIST HEALTHCARE-LE BONHEUR CHILDREN'S MEDICAL
    CENTER; AND GARY PERRIZO, DIRECTOR OF PATIENT ACCOUNTING, VANDERBILT
    UNIVERSITY MEDICAL CENTER

    	MR. FLORES.  Thank you, sir.
    	Good morning, I'm Richard Flores, Vice President of Revenue
    Cycle Operations at LifePoint Hospitals here in Brentwood,
    Tennessee.  Thank you for inviting me to testify today.
    	LifePoint owns seven rural hospitals located across Tennessee.
    The local hospital is often one of the largest employers in the
    community, along with a great number of family-owned farms.
    The south middle part of the State, where several of our hospitals
    are located, is well known for its tree nurseries.  Needless to say,
    there are quite a few uninsured people living in these areas.
    	Our hospitals are ready and willing to serve the people who
    live in their communities.  Many of them come to the emergency
    rooms because they do not have insurance and they have no other
    place to go to get care.  Some of these individuals may be
    undocumented immigrants.
    	As you know, the Federal Emergency Medical Treatment and
    Active Labor Act, called EMTALA, requires hospitals to treat
    anyone who comes through the door, regardless of their
    immigration status.  This Federal law prohibits hospitals from
    asking anyone who comes into the emergency room any financial
    information until they are medically screened.  By that time, they
    have become our patients.  It would be an impossible task for
    hospitals to determine a patient's legal status prior to providing
    care due to Federal rules and regulations.
    	Tennessee hospitals are experiencing unprecedented
    uncompensated care levels, which includes charity care as well as
    bad debt.  Tennessee claims data show a continuing increase in
    uninsured volumes.  From calendar year 2004 to calendar year
    2005, the cost to Tennessee hospitals of treating the uninsured in
    the emergency room increased by $144 million.  In 2005, the
    unreimbursed TennCare cost, combined with the cost of charity
    care, bad debt, and medically indigent care, reached over $1
    billion.
    	Due to the 2005 TennCare disenrollment changes, LifePoint
    Hospitals in Tennessee experienced a reduction of $10.2 million in
    TennCare gross revenues in the first 6 months of 2006 versus the
    same period in 2005.  During that same period, we experienced an
    increase of $5.3 million in self-pay gross revenues.  Similarly,
    TennCare emergency room visits declined 23 percent while self-
    pay emergency room visits increased 42 percent.  Please keep in
    mind that rural hospitals have far fewer referral options, such as
    indigent clinics, than our urban hospital counterparts.
    	Tennessee's Medicaid program is similar to other States, with
    the exception of having access to a disproportionate share of
    hospital allotment, commonly referred to as DSH.  Access to a
    DSH allotment would allow Tennessee's hospitals the ability offset
    the ever-growing costs of providing services to those without
    insurance.  We should be allowed to have Tennessee's hospital on
    a level playing field with all other hospitals in the country, since
    we are one of only two hospitals that do not receive a DSH
    payment.
    	I would like to acknowledge and thank Congresswoman
    Blackburn for supporting Tennessee's hospitals' effort to secure a
    permanent DSH payment for Tennessee hospitals.
    	Now, Tennessee's DSH payment should be consistent with
    DSH payments received by other States with a similar number of
    enrollees.  Without it, hospitals may downsize, potentially reduce,
    or even eliminating important healthcare services to support the
    communities, especially in rural areas.
    	I want to thank you for the opportunity to explain the uninsured
    and uninsurables, how they are impacting our hospitals and
    emergency room utilization.  We strongly urge you to consider
    approving Tennessee's request for a permanent DSH payment,
    since it will help offset the constantly increasing amount of
    uncompensated care that hospitals are providing for the people
    who live in their communities.
    	Thank you.
    	[The prepared statement of Richard Flores follows:]

    PREPARED STATEMENT OF RICHARD FLORES, VICE PRESIDENT OR
    REVENUE CYCLE, LIFEPOINT HOSPITALS

            Good morning! I am Richard Flores, vice president of revenue
    cycle operations at LifePoint Hospitals in Brentwood, Tennessee.
    Thank you for inviting me to testify today.
            LifePoint owns seven rural hospitals located across Tennessee.
    The local hospital is often one of the largest employers in the
    community, along with a great number of family-owned farms.
    The south middle part of the state, where several of our hospitals
    are located, is known for its tree nurseries.  Needless to say, there
    are quite a few uninsured people living in these areas.
            Our hospitals are ready and willing to serve the people who
    live in their communities.  Many of them come to the emergency
    rooms because they do not have insurance and they have no other
    place to go to get care.  Some of these individuals may be
    undocumented immigrants.
            As you know, the federal Emergency Medical Treatment and
    Active Labor Act, called EMTALA, requires hospitals to treat
    anyone who comes through the door, regardless of their
    immigration status.  This federal law prohibits hospitals from
    asking anyone who comes to the emergency room any financial
    information until they are screened.  By that time, they have
    become our patients.  It would be an impossible task for hospitals
    to determine a patient's legal status prior to providing care due to
    federal rules and regulations.
    	Tennessee hospitals are experiencing unprecedented
    uncompensated care (charity and bad debts) levels.  Tennessee
    claims data show a continuing increase in uninsured volumes.
    From calendar year 2004 to calendar year 2005, the cost to
    Tennessee hospitals of treating the uninsured in the emergency
    room increased by $144 million.  In 2005, the unreimbursed
    TennCare cost, combined with the cost of charity care, bad debt
    and medically indigent care, reached over $1 billion.
    	Due to the 2005 TennCare disenrollment changes, LifePoint
    Hospitals in Tennessee experienced a reduction of $10.2 million in
    TennCare gross revenues in the first six months of 2006 versus the
    same period in 2005.  During that same period, we experienced an
    increase of $5.3 million in self-pay gross revenues.  Similarly,
    TennCare emergency room visits declined 23 percent while self-
    pay emergency room visits increased 42 percent.  Keep in mind
    that rural hospitals have far fewer referral options, such as indigent
    clinics, than urban hospitals.
            Tennessee's Medicaid program is similar to all other states,
    with the exception of having access to a disproportionate share
    hospital allotment, commonly referred to as DSH.  Access to a
    DSH allotment would allow Tennessee's hospitals the ability to
    offset the ever growing cost of providing services to those without
    insurance.  We should be allowed to Tennessee's hospitals on a
    level playing field with all other hospitals in the country since we
    are one of only two states that do not receive a DSH payment.
            Tennessee's DSH payment should be consistent with DSH
    payments received by other states with similar numbers of
    enrollees.  Without it, hospitals may downsize, potentially
    reducing or eliminating important healthcare resources that support
    their communities, especially in rural areas.
            Thank you for the opportunity to explain how the uninsured
    and uninsurables are impacting our hospitals and emergency room
    utilization.  We strongly urge you to consider approving
    Tennessee's request for a permanent DSH payment since it will
    help offset the constantly increasing amount of charity care that
    hospitals are providing for the people who live in their
    communities.
            Thank you.

    	MR. DEAL.  Thank you.  Mr. Duncan.
    	MR. DUNCAN.  Thank you, sir.  Good morning, I'm Bob
    Duncan, Vice President of Advocacy and Government Relations
    for Methodist Healthcare-LeBonheur Children's Medical Center in
    Memphis, Tennessee.  Thank you for inviting me to be here and
    the opportunity.
    	Before I begin my formal testimony, I would like to recognize
    and thank Representative Blackburn for her concern, commitment,
    and support for Le Bonheur Children's Medical Center.  She has
    been a leader in bringing greater access and quality healthcare to
    the children of Tennessee and the surrounding States.  Thank you,
    Congressman Blackburn.
    	The mission of our hospital, like other institutions in
    Tennessee, is to take care of people in our community who are
    sick, injured, or entered the world with severe medical problems.
    When admitting a patient or tending to a sick child or newborn
    with life-threatening conditions, it does not matter whether they are
    documented or undocumented immigrants, uninsured individuals,
    people on commercial plans, or those enrolled in TennCare.  Our
    number one priority is to provide healthcare services to all the
    people who need it.  We are obligated to do so.
    	As you know, Tennessee's Medicaid program, TennCare, has
    just completed a fairly significant restructuring.  As a result of the
    changes, TennCare is now similar to the other States Medicaid
    programs.  While we support many of the changes that occurred,
    Tennessee hospitals continue to see growth in uncompensated care.
    	In fact, in 2005 Tennessee's hospitals provided over $1 billion
    in uncompensated TennCare, charity care, and bad debt, an amount
    that is expected to increase this year and well beyond.  Many of the
    uninsured will continue to seek primary and emergency care
    through hospital emergency rooms.
    	This past year our system alone had approximately $47.5
    million in charity write offs, $8 million of this coming from our
    emergency room.
    	We believe that the Federal government, along with State
    government, has a role in paying for charity care.  Hospitals are not
    paid what it costs them to provide care to uninsured individuals
    and charity patients.  In 2004, 48 of Tennessee's 130 acute care
    hospitals were losing money.  Another seven hospitals had
    operating margins below 2 percent.  As a result, over 42 percent of
    Tennessee's hospitals are at financial risk.  As you can see, we
    need your help to remedy this situation.
    	As Richard mentioned, Tennessee is now one of only two
    States that does not have a permanent Medicaid disproportionate
    share hospital payment to help offset uncompensated care costs for
    charity and TennCare patients.  Tennessee had a Medicaid DSH
    program prior to the implementation of TennCare in 1994.  The
    State gave up that DSH program under the assumption that
    TennCare's coverage of the expansion populations would drive
    charity care levels down, thereby eliminating the need for the DSH
    payments.  This never proved true, however, and charity care costs
    were back at pre-TennCare levels in 2000.
    	It is imperative that Tennessee's hospitals obtain a permanent
    Medicaid DSH payment to help offset at least some of the costs
    providers incur caring for charity and TennCare patients.  We'd
    like to thank you again for this opportunity to tell you our concerns
    about caring for some of the most vulnerable people in our
    community and appreciate your interest in addressing the issue of
    uninsured care and finding solutions.
    	Thank you, have a good day.
    	[The prepared statement of Bob Duncan follows:]

    PREPARED STATEMENT OF BOB DUNCAN, VICE PRESIDENT FOR ADVOCACY AND GOVERNMENT
    RELATIONS, METHODIST HEALTHCARE-LEBONHEUR CHILDREN'S MEDICAL CENTER

            Good morning! I am Bob Duncan, vice president for advocacy
    and government relations at Methodist Healthcare-Le Bonheur
    Children's Medical Center in Memphis, Tennessee.  Thank you for
    inviting me to testify today.
            Before I begin my formal testimony, I would like to recognize
    and thank Representative Blackburn for her concern, commitment
    and support for Le Bonheur Children's Medical Center.  She has
    been a leader in bringing greater access and quality health care to
    the children of Tennessee and the surrounding states.
            The mission of our hospital, like other institutions in
    Tennessee, is to take care of people in our community who are
    sick, injured or entered this world with severe medical problems.
    When admitting a patient or tending to a sick child or newborn
    with life-threatening conditions, it does not matter whether they are
    documented or undocumented immigrants, uninsured individuals,
    people on commercial plans or those enrolled in TennCare.  Our
    number one priority is to provide healthcare services to all the
    people who need it.  We are obligated to do so.
            As you know, Tennessee's Medicaid program, TennCare, has
    just completed a fairly significant restructuring.  As a result of the
    changes, TennCare is now similar to other states' Medicaid
    programs.  While we support many of the changes that occurred,
    Tennessee hospitals continue to see growth in uncompensated care.
            In 2005, Tennessee's hospitals provided over $1 billion in
    uncompensated TennCare, charity care and bad debt, an amount
    that is expected to increase this year and beyond.  Many of the
    uninsured will continue to seek primary and emergency care
    through hospital emergency rooms.
            This past year, our system had approximately $47.5 million in
    charity write-offs.  Included in this number is $8 million of ER
    charity care.
            We believe the federal government, along with state
    government, has a role in paying for charity care.  Hospitals are not
    paid what it costs them to provide care to uninsured individuals
    and charity patients.  In 2004, 48 of Tennessee's 130 acute care
    hospitals were losing money.  Another seven hospitals had margins
    below 2 percent.  As a result, over 42 percent of Tennessee's
    hospitals are at financial risk.  As you can see, we need your help
    to remedy this situation.
            Tennessee now is one of only two states that does not have a
    permanent Medicaid disproportionate share hospital payment to
    help offset uncompensated care costs for charity and TennCare
    patients.  Tennessee had a Medicaid DSH program prior to the
    implementation of TennCare in 1994.  The state gave up that DSH
    program under the assumption that TennCare's coverage of the
    expansion populations would drive charity care levels down,
    thereby eliminating the need for the DSH payments.  This never
    proved true, however, and charity care costs were back at pre-
    TennCare levels in 2000.
    	It is imperative that Tennessee hospitals obtain a permanent
    Medicaid DSH payment to help offset at least some of the costs
    providers incur caring for charity and TennCare patients.  We
    thank you for the opportunity to tell you our concerns about caring
    for some of the most vulnerable people in our community and
    appreciate your interest in addressing the issue of uninsured care.
    	Thank you.

    	MR. DEAL.  Thank you.  Mr. Perrizo.
    	MR. PERRIZO.  Thank you, Chairman Deal and
    Congresswoman Blackburn, for allowing me to testify in this
    important field hearing.  I am Gary Perrizo, Director of Patient
    Accounting, at Vanderbilt University Medical Center, located here
    in Nashville.
    	I will summarize my testimony and request the full written
    testimony already provided be included in the records of this
    hearing.
    	MR. DEAL.  It will be included.
    	MR. PERRIZO.  Thank you.
    	I would like to explain how an illegal immigrant actually enters
    into the Vanderbilt system.  Basically, through the emergency
    room or brought directly to our trauma center.  If the patient is
    admitted, our registration staff will try to determine if the patient is
    a possible illegal immigrant.  If believed that they could be, the
    patient is referred to the Department of Human Services of the
    State of Tennessee.  If DHS determines that it is an illegal
    immigrant, as I think we've already heard, the patient is enrolled in
    TennCare, but only for that single admission.
    	Vanderbilt will then receive payment from the TennCare MCO
    for the emergency admission at the TennCare contractual rates.
    Some recent data that we have assimilated is that so far in 2006,
    this calendar year, we have admitted 174 undocumented patients.
    This is a 17 percent increase over the same period last year.
    	One hundred twenty of this year's undocumented patients had
    been deemed illegal immigrants by DHS, and had been granted
    TennCare coverage.  The reimbursement received, like all
    TennCare cases, is approximately 65 percent of the actual cost for
    services provided.  This results in a loss to Vanderbilt of
    approximately $599,000 on these admissions thus far.
    	Forty-seven of the patients are under review by DHS at this
    time.  If these patients are not granted TennCare coverage, the
    estimated loss will increase by another $755,000.
    	For the illegal immigrants that were admitted for this same
    period in 2005, more than 20 percent of those patients returned for
    non-emergency care, which was not covered by TennCare.
    	Another category of patients are the illegal immigrants that
    receive emergency room care but are not admitted, the treat and
    release population.  Registration staff in an ER cannot determine if
    the patient is in the United States legally or illegally.
    	For visits from January 2005 through March of this year, 504
    visits were made by possible illegal immigrants.  The total
    unreimbursed cost of these visits is $858,000.  This results in an
    estimated annual cost of unreimbursed care to illegal immigrants at
    Vanderbilt of $3.8 million.
    	Although this is significant, it pales in comparison to the
    overall uncompensated care Vanderbilt provides in this
    community.  We are morally and legally bound to provide care in
    an emergency condition.  This is consistent with our mission and
    consistent with the compassion of the just society in which we live.
    	Under Federal laws, like EMTALA, we are required to provide
    emergency care regardless of a patient's immigration status or
    ability to pay.  The moral and legal requirements carry a significant
    price tag for hospitals and doctors, especially at our Nation's
    academic medical centers.
    	At Vanderbilt in the past 12 months, the cost of providing care
    to patients that are unable to pay topped $74 million.
    	I would like to briefly mention three concerns we have at
    Vanderbilt.  First, the implementation of TennCare in 1994
    resulted in the elimination of the Medicaid disproportionate share
    payments.  TennCare, though, has evolved where eligibility is
    functionally equivalent to traditional Medicaid in other sites in
    which a disproportionate share payment is made.  It is imperative
    that Tennessee be provided with a disproportionate share payment
    allotment under Federal law.
    	Secondly, the House immigration bill would criminalize any
    caregiver who knowingly provides care to an illegal immigrant.
    We do not believe that the intent of this bill would have doctors
    and nurses stand by and not intervene to save a human life or
    prevent suffering.  This would be a direct contradiction to the
    Federal EMTALA law.
    	Lastly, for many families, especially those of limited resources
    and ability, gathering the required documentation to enroll in
    TennCare could be a significant challenge.  For women that are
    expecting a child, any delay in gathering the required
    documentation could result in delays in obtaining prenatal care.
    We believe that in the case of pregnancy, the law ought to allow
    prenatal care to begin while documentation is gathered and
    prepared.
    	I would like to thank Chairman Deal and Congresswoman
    Blackburn, and her support for Tennessee getting a DSH payment,
    and would answer any questions you might have.
    	Thank you.
    	[The prepared statement of Gary Perrizo follows:]

    PREPARED STATEMENT OF GARY PERRIZO, DIRECTOR OF PATIENT ACCOUNTING,
    DEPARTMENT OF FINANCE, VANDERBILT UNIVERSITY MEDICAL CENTER

            Thank you for the opportunity to testify at this important field
    hearing.  My name is Gary Perrizo and I am the Director of Patient
    Accounting at Vanderbilt University Medical Center.  I have been
    asked to discuss the impact of treating illegal immigrants on our
    medical center.
            Let me begin by explaining how illegal immigrants enter our
    system.  Primarily these individuals come to either our emergency
    department or they are transported to our trauma center.  If it is
    necessary to admit an individual to the hospital, our registration
    staff makes an initial effort to determine citizenship/immigration
    status.  If it is believed that the patient may be an illegal
    immigrant, the case is referred to the Tennessee Department of
    Human Services (DHS) for their review.  If DHS determines that
    the patient is an illegal immigrant and is in need of hospitalization,
    the individual will be enrolled in TennCare for a single period of
    hospitalization and we will receive payment from a TennCare
    MCO for their emergent care at TennCare contractual rates.  I can
    provide some data about Vanderbilt's recent experience with this
    category of patients.
            For the period January 1, 2006 through August 6, 2006,
    Vanderbilt has admitted 174 undocumented patients, an increase of
    17% over the same period last year.  Thus far, DHS has determined
    that of these 174 patients, 120 were illegal immigrants and were
    granted TennCare coverage.   The reimbursement received by
    Vanderbilt for these cases (as is true of all TennCare cases) is
    approximately 65% of the actual costs incurred in treating these
    patients, resulting in a net loss to the Vanderbilt of approximately
    $589,000 over the past 7 months.  The remaining 47 patients have
    been determined to have no resources with which to pay for their
    care and we are awaiting a DHS determination of their eligibility
    for coverage under TennCare.  If no reimbursement is obtained for
    these 47 undocumented admissions, the estimated loss will
    increase by $755,000.  For 7 admissions, other insurance coverage
    for the undocumented patients was obtained through workers
    compensation or other programs and that provide full
    reimbursement to Vanderbilt.
            For illegal immigrants who had received emergency
    admissions at Vanderbilt in 2005, more than 20% returned for
    follow-up care that was not covered by the TennCare program and
    those costs are not included in our estimates above.
            Now let me discuss a second category of patients -- illegal
    immigrants who are seen for emergency care but not admitted to
    the hospital.  Typically the registration staff in an emergency room
    have no way of knowing or tools to determine if a patient is in the
    United States legally or illegally.  Of the visits between January 1,
    2005 and March 31, 2006, 504 are possible illegal immigrants
    based on the information provided at registration.  The total
    unreimbursed cost of these visits to the Medical Center is
    approximately $858,000.
            Based on these figures, I estimate that our annual cost of
    unreimbursed care for services provided to illegal immigrants is
    about $3.8 million.  It is a significant contribution but pales in
    comparison to the overall price tag that Vanderbilt bears in
    providing uncompensated care within our community.
            We are morally and legally obligated to provide care for
    anyone who is in urgent need.  It is consistent with our mission and
    it is consistent with the compassion of the just society in which we
    live.  Under other federal statutes, particularly EMTALA, we are
    required to provide emergency care to all who present themselves
    at our emergency department, regardless of their
    citizenship/immigration status, and regardless of whether they have
    insurance coverage or the ability to pay.
            But that moral commitment and legal requirement to care for
    those in need has come to carry a significant price tag for hospitals
    and doctors alike especially those at our nation's academic medical
    centers.  At Vanderbilt in the past 12 months alone our cost for
    providing care to individuals who were unable to pay for that care
    topped $74 million.  While only a small fraction of our charity and
    indigent care patients are undocumented, we have seen a steady
    growth of undocumented patients paralleling the growth of our
    immigrant population in general.
            Let me briefly mention three specific issues of concern to
    Vanderbilt.  First, since the establishment of TennCare in 1994,
    Medicaid Disproportionate Share Payments were eliminated under
    the state's Section 1115 Waiver.  TennCare has evolved, however,
    so that eligibility for coverage is functionally equivalent to
    traditional Medicaid programs in other states that receive DSH
    payments.  As such it is imperative that Tennessee be provided
    with a DSH allotment under federal law.
            Second, the House immigration bill would criminalize any
    caregiver who knowingly provides care to an illegal immigrant.
    We do not believe that the drafters of this bill intended to have
    doctors and nurses stand by and not intervene to save a life or
    prevent suffering.  To do so would be repugnant to our values as a
    nation and to our oaths taken as providers.  It is also in direct
    contradiction to the federal EMTALA law.
            Finally, for many families, especially those of limited means
    and those who may or may not have strong language and cultural
    skills, gathering and preparing the necessary documentation to
    establish their eligibility for TennCare or immigration status could
    from time to time present challenges.  For a woman who has
    recently discovered she is expecting a child, the inevitable delays
    in assembling documentation may result in delays in securing
    appropriate pre-natal care.  We believe that in the case of
    pregnancy, the law ought to allow pre-natal care to begin while
    documentation is prepared.  The avoided costs of precise pre-natal
    care are well documented in literature.  The principle that should
    guide in the case of a pregnant woman ought to be to treat first and
    sort the rest out later.
            Thank you for the opportunity to present to this committee and
    this chance to comment on such an important topic.  I am happy to
    answer any questions you or members of the Committee may have.

    	MR. DEAL.  All right, thank you gentlemen.
    	First of all, let me pick up, Mr. Perrizo, with some of your
    comments.  Your concern, as I understand it, is that you think the
    House version of the immigration reform would criminalize
    anyone who would provide medical care.  Let me assure you that
    that is not my understanding.  It is an issue that, in light of your
    comment, we will certainly go back and review.  It is, I'm sure, not
    the intent of anyone to do that, because there you would have, as
    you point out, a conflict between the requirements of EMTALA, I
    don't think, let me assure you, is the intent of the House of
    Representatives.
    	I think the intent of the House of Representatives is that we
    stop having a wink and a nod on this issue of illegal immigration.
    It's going to require institutions such as hospitals to be cooperative
    in that effort.
    	As was pointed out earlier by Mr. Smith, I believe it was this
    $1 billion that we authorized under the MMA to pay for
    uncompensated care for illegal immigrants.  I haven't heard the
    latest, but what I have been told is that, as he indicated, most
    hospitals are not particularly interested in that.  They would just as
    soon not apply for those funds because it requires them to submit
    information and documentation that says we are eligible for this
    amount of money under this billion dollars that's been allocated.
    	The point I would make to you is, that if we are going to make
    these reforms is that we all have to work together cooperatively,
    and you are an important link in that chain.
    	I recognize, and I think I know Mrs. Blackburn and I both
    recognize, that EMTALA is one of the real problem points and
    pressure points for hospitals.  As Mr. Flores pointed out, without
    some changes to that, by the time you go through the screening
    process in the emergency room you might as well go ahead and
    treat the patient, because the time and the effort that you've
    expended is already a considerable amount of what you would do,
    perhaps, anyway.
    	One of the things that we try to do under the DRA, in fact there
    was a provision that I fought for hard and fast, and we got it
    through the House.  We could not get it through the conference
    committee because the Senate would not agree to it, was a
    provision that I think would put a common-sense approach to this.
    It says that if it is very obvious early on that this is not an
    emergency room matter, it is a non-emergency presentation, that
    the hospital and the doctor in charge would have the authority to
    divert that individual to a non-emergency room setting.
    	As you point out, many rural areas don't have the opportunity
    for those non-emergency room settings, but many do, and many
    more will have.  In fact, tonight I am speaking to what is now the
    largest free medical clinic in the State of Georgia, and one of the
    ten largest in the entire United States, which is in my hometown.
    My hometown of Gainesville, Georgia is not any thriving
    metropolis, and, quite frankly, it's not nearly as large as the
    community where we sit here today.  But, my medical community
    and my hospital, in fact, my local hospital has over the last 3 years
    donated a million dollars to this free medical clinic that accepts no
    governmental money, neither Federal, State, nor local.
    	So, I think we have to encourage those kind of things, but the
    key to a diversion, as I know all of you know, and as I know my
    doctor friends certainly recognize, is there has to be some liability
    protection for making that decision, because you are not going to
    always be 100 percent correct.
    	In our legislation that we passed in the House, and Mrs.
    Blackburn was helpful in getting that through our Committee and
    then through the House version, provided that kind of protection
    for those in the emergency room who will make that diversionary
    decision.
    	As I said, unfortunately, it did not survive in the final version,
    but I think we have to revisit issues like that, because we can do all
    the good things that I think we've probably talked about.  I think in
    general there is agreement that we ought to mean what we say
    when we pass a law that says that this is a program that is taxpayer
    supported and it's intended for our citizens, and not intended for
    anybody else.  We ought to mean that, and to enforce it.  There are
    going to be some pressure points, but it does require all of us to
    work cooperatively, because when it is enforced in that regard
    what's going to be the logical consequence?  The emergency room
    is going to be the point of presentation.
    	What that says to me is that we just don't throw up our hands
    and say, oh, well, it didn't work, it simply says, it emphasizes the
    importance of our entire immigration structure and the
    enforcement of those coming into our country, so that we don't
    have these problems developing as an after-the-fact consequence.
    	So, I want to tell you that we do appreciate what hospitals do.
    You provide valuable services.  We are very cognizant of the fact
    that the EMTALA situation needs to be revisited.  Quite frankly, I
    don't know that there is the political will to do it, because the
    alternatives have not fully matured yet.
    	However, as a part of the DRA, we had $50 million that was
    there to encourage and help provide grants for these alternative
    clinics to be developed.  So, I'm sure that our State representatives
    and senators, and, hopefully, governmental officials in the State of
    Tennessee, are taking a close look at that grant program, because
    those alternative sites will in large part be part of the answer that is
    there.
    	Now, that's not to say that you don't have to develop a pattern
    in patience, and you all recognize that very well.  If they consider
    your emergency rooms to be their medical home, they are going to
    continue to show back up there.
    	So, part of the process is an education process that I'm sure
    many of you are already doing to educate people as to alternative
    sites that are less costly than your emergency rooms.
    	Does anyone want to comment about that aspect of it?
    	MR. PERRIZO.  I'll say a few words on that.
    	Yes, we realize that at Vanderbilt, as a matter of fact, our
    faculty staff, nurses, et cetera, actually help support by working, et
    cetera, at three clinics here in Nashville that are unfunded, as what
    you were talking about.
    	MR. DEAL.  Right.  Well, in fact, every State, according to my
    study, now has at least one free clinic, and many states like mine
    have as many as 30, I believe is the latest that we've seen.  I think
    that is sort of the wave of the future, to help take some of this
    pressure off of what you are experiencing in your emergency
    rooms, and that is the most expensive point of presentation in the
    whole healthcare system.
    	So, I'm not going to take anymore of the time, and defer the
    remaining amount of my time to your Congresswoman, who does
    such a good job.
    	MRS. BLACKBURN.  Thank you, Mr. Chairman.
    	Let's go back to talk about the DSH payments for just a
    minute, to be certain that everyone who is watching this hearing,
    and those who are in the room, understand that when Tennessee
    decided in '94 that they were going to move to the TennCare
    program, and do under Section 1115, their managed care program,
    they decided to not have the DSH payments.  They forewent those
    payments, and I think we need to understand that, that that was an
    Administration decision at that point in time.
    	The other part is, TennCare is an Executive Order program in
    this State.  Representative Rowland and Senator Ketron, and their
    colleagues in the General Assembly, cannot go in and pass a law
    and change that.  The same thing, we can't go in and pass a law
    and change the TennCare program.  That is a State program, and I
    want to be certain that everyone understands that premise as we
    move forward in our discussion.
    	So, with that understanding, going back to '94, and you can
    give this answer to me in '94 dollars and we can run it out, or you
    can give it to me in today's dollars, so to each of you, for the
    hospitals that you have referenced, I would ask you, before
    TennCare how much money did you get in Medicaid and Medicare
    DSH payments?  Any idea?
    	MR. PERRIZO.  I can't say for 1994, but in today's dollars we
    have estimated that our DSH payment would be approximately $39
    plus million.
    	MRS. BLACKBURN.  Thirty plus--
    	MR. PERRIZO.  In today's dollars.
    	MRS. BLACKBURN.  --did you say million?
    	MR. PERRIZO.  Million, Thirty plus million.
    	MRS. BLACKBURN.  Since we are talking in millions and
    billions today, and very seldom in dollars and cents today, I want
    to be certain that we get that correct for our record.
    	Thank you, Mr. Perrizo.
    	MR. DUNCAN.  I don't have those numbers on the top of my
    head, but it would be roughly half that estimate.
    	MRS. BLACKBURN.  Half that estimate.  Okay, so you are
    saying about $15 million.
    	MR. DUNCAN.  Yes.
    	MRS. BLACKBURN.  That's what you would have received in
    the DSH payments.
    	Mr. Flores, any idea?  I don't think LifePoint was even in
    existence in '94.
    	MR. FLORES.  We were not, not until 1999.  However, I did
    want to point out that based on CMS' own estimates, Tennessee's
    DSH allocation would have been $447 million in 2003.  However,
    the State and CMS were able to provide $100 million in essential
    access payments to hospitals that year, which is approximately 22
    percent of what we would have gotten had we received the DSH
    payment.
    	MRS. BLACKBURN.  Okay.  Let's move to the essential access
    hospital payments, the EAH payments.  So, this is what you all
    currently get.  So, why don't you tell me how much you are
    receiving each year.
    	And, Mr. Perrizo, we'll start with you on the EAH payments.
    	MR. PERRIZO.  I don't know at this time.
    	MRS. BLACKBURN.  You don't know.
    	MR. PERRIZO.  I could get you that information.
    	MRS. BLACKBURN.  Perfect.
    	Mr. Duncan?
    	MR. DUNCAN.  Approximately, $8 million.
    	MRS. BLACKBURN.  Eight million.  All right.
    	Okay, Mr. Flores?
    	MR. FLORES.  Likewise, I would have to provide that.
    	MRS. BLACKBURN.  Okay, if you will provide that.
    	And then, also provide for me in that number how that is
    broken down between the emergency and the non-emergency care,
    because if TennCare is saying they really don't have a problem
    with the illegal immigration issue and the verification issue, and
    one of the promises, if you will, of TennCare was to be that you
    would solve the problem of charity care at the hospitals.  You
    would at least be receiving something for the amount of charity
    care that you provided.
    	Of course, what we have seen is that it seems, and what we are
    hearing from your testimony is, the emergency care is increasing
    every single year at an increasing percentage than the year prior.
    	Everyone is nodding in agreement on that.
    	So, we can say that no longer holds forth, that premise of
    TennCare did not work, and the essential access payments are not
    meeting the needs that you would have from a DSH payment, and
    offsetting this.
    	Okay.  Another thing that I would like to know as we look at
    this funding mechanism from the hospitals, and, Mr. Chairman, if I
    may, I see Mr. Becker, and I know that other hospitals are
    represented, I think that this may be a point that we would want to
    look at as we talk about managed care programs, looking at what
    percentage of the total budget the EAH and the DSH payments
    contribute, Medicare DSH payments, looking at what percentage
    of your total budget, your operating budget every year, what
    reliance there is upon those payments.
    	So, as you submit your figures, let's submit that one also, so
    that we can be comparing apples to apples, and oranges to oranges,
    as we move forward in this discussion.
    	Mr. Flores, coming back to you, I think in your testimony you
    said that the primary emergency service was pregnancy and
    delivery?
    	MR. FLORES.  No, but it was in testimony before.
    	MRS. BLACKBURN.  Was that the prior testimony?  Okay.  All
    right.  We've got too many sheets of paper around here.
    	What I would like to know from you all is the most common
    types of emergency and non-emergency ER, what you all are
    seeing in your hospitals, where the greatest pressure comes,
    because one of our concerns is the misuse of emergency room
    services and the increasing costs of that misuse to the taxpayer, and
    the fact that that misuse then does prohibit access, timely access, to
    citizens who are there to use those services.
    	Okay.  Another question, just looking at--before we leave the
    DSH payment, when Tennessee made the decision to forgo the
    DSH payments in lieu of a restructured Medicaid payment, via
    TennCare, those extra dollars, does TennCare itself keep those
    dollars, or are those coming to you all via another revenue stream
    or another avenue?  Are you seeing any increased revenue stream
    via TennCare funding?
    	MR. PERRIZO.  No.
    	MRS. BLACKBURN.  Mr. Perrizo, you are not.
    	MR. PERRIZO.  No.
    	MR. DUNCAN.  No.
    	MRS. BLACKBURN.  Mr. Duncan, you are not.
    	MR. FLORES.  No, ma'am.
    	MRS. BLACKBURN.  You are not, okay, so we've got money
    just in thin air somewhere.  Okay.
    	Physicians assistants and nurse practitioners in the ER, are you
    all extensively using those in the ER as you staff?
    	MR. PERRIZO.  Yes.
    	MRS. BLACKBURN.  You are.  Okay.  Is that a successful
    practice?  Okay, it keeps some of the costs down?
    	MR. PERRIZO.  Yes, it does.  In some of our clinics that I was
    referring to earlier, are with nurse practitioners, very intensively,
    for primary care types of items.
    	MRS. BLACKBURN.  You know, I'm hearing of some States and
    local governments that are beginning to send non-emergency care
    that is coming to the ER to clinics.  Is that a practice that you all
    are considering?
    	MR. PERRIZO.  We are actually trying to refer them to the right
    site for their service.
    	MRS. BLACKBURN.  Okay, and you are doing the referral to the
    appropriate site and type caregiver.
    	MR. PERRIZO.  Correct.
    	MRS. BLACKBURN.  Correct.  Okay.  Mr. Duncan?
    	MR. DUNCAN.  Doing the same thing.  We have the church
    health center there, or the community help loops.
    	MRS. BLACKBURN.  Okay, the community help centers?
    	MR. DUNCAN.  Yes.
    	MRS. BLACKBURN.  You are referring, okay.
    	And, are you doing that in Shelby County as well as in the
    outlying counties?
    	MR. DUNCAN.  I couldn't speak to the outlying counties,
    because our hospitals are all located in the Shelby County, other
    than Fayette.
    	MRS. BLACKBURN.  Okay, one other question on the
    verification status, because we've heard from our elected officials,
    and then TennCare and CMS, about verifying an individual's
    status.  And, looking at the verification and then the reverification
    status through the documentation, I know that it would be very
    difficult to ask a patient about their immigration status before
    receiving care, but my question to you would be, as they continue
    in your care do you have a period of time in there where you ask a
    patient their immigration status or ask for documentation and
    paperwork as you are doing your paperwork?  Do you all ever ask
    for that status?
    	Mr. Perrizo?
    	MR. PERRIZO.  On the in-patient side, those patients I was
    referring to earlier, the 174 undocumented, our financial
    counselors actually work with the patients and/or their families
    while they are in house to try to obtain that information.  That's
    how we are able to actually say someone is undocumented.  We
    don't know if they are illegal.
    	MRS. BLACKBURN.  Okay.  So, you actually begin to move
    through that before you send them to DHS.
    	MR. PERRIZO.  Correct.
    	MRS. BLACKBURN.  To make their determination.
    	MR. PERRIZO.  Yes, ma'am.
    	MRS. BLACKBURN.  So, you would probably have a little bit of
    disagreement with Mr. Gordon then, when it comes to whether or
    not they are providing care for those that are in here illegally.
    	MR. PERRIZO.  Well, we are already providing the care, it's just
    will we get reimbursed.
    	MRS. BLACKBURN.  Right, their payment for it.  They had a
    total of $1.7 million in July for 62 patients, and you all, so far this
    year, have had 174 patients, 120 were illegal, and about 65 percent
    of the actual cost incurred in treating these patients, that was a
    $589,000 loss over a seven-month period.
    	MR. PERRIZO.  Correct.
    	MRS. BLACKBURN.  Now, okay, you have that kind of loss over
    that period of time, and you, as one single facility in this State,
    have that type loss, and we hear from TennCare that they've got 62
    people within a month, 62 individuals that are within this service,
    how do you go back and recoup those dollars?  Are you cost
    shifting to the private sector?  You are not getting a full
    reimbursement on your TennCare.  We know what your Medicare
    reimbursement rate is, so how does a facility like Vanderbilt, you
    are the Director of Patient Accounting, and you've got to look at
    that bottom line, how do you square those numbers and recover
    and cover that type loss?
    	MR. PERRIZO.  Well, as we were speaking earlier, the
    uncompensated care, not only at Vanderbilt, but in the State of
    Tennessee, is a problem.  Not just from the illegal immigrants, but
    from the general uninsured and under-insured population.
    	A facility has no choice but to either raise their rates,
    renegotiate their contracts and shift those losses to the insurance
    companies paying those providers' bill, or the private pay sector
    that can afford it are charged more.
    	MRS. BLACKBURN.  I appreciate that.  You know, we are
    hearing from some of those that oppose addressing the illegal
    immigration issue, that there is not a problem, or that no problem
    exists, and we don't--but, I think that exactly what you are saying
    indicates there is a problem, there is a disconnect, between what is
    verified, what we hear from our entities as being verified and
    people that are on Medicaid, the care that is being delivered, we
    see that your charity care increases every single year, and
    somebody is going to pay the bill.  And, it is many times going to
    be those private pay.
    	So, I would say that this refutes that argument that there is no
    problem, there is a problem and a pressure to the system.
    	Anything either of you would like to add to that?  No.
    	Mr. Chairman, thank you.
    	MR. DEAL.  Well, thank you, and on that latter point, I think we
    all recognize that as we see the number of uninsured in our country
    rise, anything that puts pressure to drive up the cost of private
    health insurance is necessarily going to increase the number of
    uninsured, because the insurance policy becomes even more
    unaffordable.  So, this is one of those factors that drives up the cost
    of private insurance and, therefore, necessarily, increases the
    number of total uninsured in our country.  So, it is a problem.
    	I want to thank you gentlemen for being here.  We appreciate
    your testimony.
    	This concludes the panels that were scheduled to testify here
    today.  As I indicated at the outset, this is a field hearing of the
    Health Subcommittee of the Energy and Commerce Committee,
    and as such we operate under the rules of that Committee, just as if
    we were holding this hearing in our chambers in our meetings
    rooms in Washington, D.C.  As a result of that, it does not allow
    us, unfortunately, to have audience participation.
    	I'm sure Mrs. Blackburn and I will both be here for a little
    while, for those of you who may wish to follow up with anything
    with us personally.
    	This is the first of two hearings.  The second will be in Dalton,
    Georgia, at 10:00 a.m.  next Tuesday, the 15th, at the Trade Center
    there.  In light of that, we will now stand in recess until that
    hearing resumes next Tuesday.
    	Thank you all.
    	[Whereupon, at 12:09 p.m., the committee was adjourned.]

    EXAMINING THE IMPACT OF ILLEGAL IMMIGRATION ON THE MEDICAID PROGRAM AND OUR
    HEALTHCARE DELIVERY SYSTEM

    THURSDAY, AUGUST 15, 2006

    HOUSE OF REPRESENTATIVES,
    COMMITTEE ON ENERGY AND COMMERCE,
    Washington, DC.

            The committee met, pursuant to notice, at 10:00 a.m., in the
    Lecture Hall, Northwest Georgia Trade and Convention Center,
    2211 Dug Gap Battle Road, Dalton, Georgia, Hon. Nathan Deal
    [member of the committee] presiding.
    	Members present: Representatives Deal, Norwood, and Solis.
    	Staff Present:  Brandon Clark, Policy Coordinator; Katherine
    Martin, Professional Staff Member; Chad Grant, Legislative Clerk;
    and Amy Hall, Minority Professional Staff Member.
    	MR. DEAL.  We will call the Subcommittee to order.  This will
    be the second session of hearings that began last week in
    Nashville, Tennessee, a meeting of the Health Subcommittee of the
    Energy and Commerce Committee of the House of
    Representatives.
    	My name is Nathan Deal, I have the opportunity to chair that
    Subcommittee and I am pleased to have two of my colleagues here
    today, who I will introduce when it is appropriate for them to give
    their opening statements.
    	Let me just sort of give a general overview of the process that
    will be followed.  This is a hearing, just as if it were a hearing in
    Washington, D.C., in our committee rooms there.  It will be a
    panel of witnesses that are going to present testimony followed by
    questions from the Members of Congress who are here today.  That
    is the format that we will follow and we will proceed and I will
    recognize myself for an opening statement at this time.
    	The topic which we are examining is:  Examining the Impact
    of Illegal Immigration on the Medicaid Program and our
    Healthcare Delivery System.
    	Today, we are going to hear from three panels of distinguished
    and expert witnesses about the impact that illegal immigration is
    having on our healthcare delivery system and to get their
    perspective on a few recent legislative provisions that were
    produced by this Committee in an effort to help address this ever-
    growing problem.
    	There are well over 11 million illegal aliens currently residing
    in the United States and the fact that this number is rapidly
    growing every day.  We allow our borders to remain unsecured and
    our immigration laws unenforced.  I think there has been no
    question that the problem of illegal immigration is one of the most
    important topics and policy debates that is currently taking place
    before Congress.
    	I stand with my Republican colleagues in the House in support
    of the legislation that we passed just recently, which is a strong
    immigration bill that I believe does what most of the American
    public expects and deserves.  We want to strengthen our borders
    and enforce our immigration laws.  As any healthcare providers
    will tell you, and you will hear from some here today, an ounce of
    prevention is worth a pound of cure.  Unfortunately, it is clear that
    some on the other side of the issue have no plan for securing our
    borders and no plan for stopping the flood of illegal immigration
    that is so negatively impacting our public safety, our children's
    schools, and our healthcare system.
    	In 1996, Congress responded to the will of the people and
    passed the Illegal Immigration Reform and Immigration
    Responsibility Act.  One of the main provisions of this legislation
    was to limit all Federal benefits, including Medicaid coverage, to
    those who are lawfully in the United States.  Of course, people on
    the other side of this issue opposed that provision back then
    because they believed that your hard-earned tax dollars should go
    to pay for healthcare for people who are illegally in our country.  It
    is a lot of the same people today who are now opposing the efforts
    to ensure that only citizens get access to taxpayer funded benefits.
    The most unfair thing about what our opponents are advocating is
    that an illegal immigrant on Medicaid would almost certainly have
    a better healthcare benefits package than what is available to most
    taxpayers who are actually paying for those Medicaid benefits.
    	Of course, we are not just sitting back and waiting on a single
    comprehensive legislative solution to pass both houses of
    Congress.  We intend to address this problem whenever and
    wherever we can.  To help address the negative impact of illegal
    immigration on our healthcare system, the Energy and Commerce
    Committee produced two important provisions in the Deficit
    Reduction Act of 2005, which is commonly referred to as the
    DRA.  One of the provisions which I authored, along with my
    friend Congressman Charlie Norwood, who is with us today, and
    we fought to include in the DRA, was a provision that requires
    States to obtain documentary evidence that the person applying for
    Medicaid benefits is actually a United States citizen, as is required
    by law.  This is not a new concept for government programs, since
    the Medicare and SSI programs both require proof of citizenship
    for all beneficiaries.  It is just that Medicaid has not been seriously
    reformed since the 1960s and was a little behind the times.
    	Before the enactment of this provision, the Inspector General
    of the Department of Health and Human Services found that 46
    States and the District of Columbia allowed self-declaration of
    citizenship for Medicaid eligibility, and 27 of those States never
    verified any citizenship statements at any point.  This means that
    people simply had to say that they were citizens, in whatever
    language they chose to say it in, and they would be eligible for
    thousands of dollars of taxpayer funded Medicaid benefits.  That
    simply, in my opinion, was unacceptable.
    	Of course, the advocates on the other side of this issue fought
    very hard to prevent this provision from being included in the
    DRA.  They fought very hard to defeat this needed legislation
    when it was being voted on by Congress.  Now some of those same
    advocates are fighting just as hard to weaken this common-sense
    provision as much as possible.  But it is my hope that those
    implementing this provision will stand firm on this very important
    issue.
    	Another provision that was included in the Deficit Reduction
    Act was a provision to allow States the flexibility to impose cost
    sharing on healthcare services furnished in an emergency room
    that a physician determines is not a real medical emergency, such
    as an ear infection or strep throat.  To protect beneficiaries, this
    provision requires that an available and accessible alternative must
    be available to the beneficiaries and the treating hospital must refer
    the individual to the alternative site in order for the co-pay to be
    charged.  Like the citizenship verification provision, this provision
    is designed to eliminate millions of dollars of waste in the
    Medicaid system by helping to ensure that Medicaid patients
    receive care in the appropriate setting.  This provision also helps
    patients.  Studies have also shown that patients who receive care in
    the appropriate setting have better healthcare outcomes.  As we all
    know, the ER is not the best place to receive primary care services
    or preventive healthcare services.
    	Although this provision only applies to Medicaid beneficiaries,
    it will also help reduce some of the negative impact of illegal
    immigration who improperly utilize the ER.  It provides $50
    million in grant funding to the States to establish alternative non-
    emergency providers in communities across the United States.
    	In addition to the increased number of alternative non-
    emergency providers, this provision will also make hospital
    personnel more familiar and comfortable with referring non-
    emergency patients to the appropriate healthcare providers.  It will
    also increase communication between ER personnel and these non-
    emergency providers.  The logic behind this provision is also
    simple.  It costs approximately $340 to care for a non-emergency
    patient in the emergency department while it costs less than $70 to
    care for the same patient in a health clinic or a physician's office.
    That means that over five people can be treated in a physician's
    office for less money than one person can be seen in the
    emergency room.  I believe this is a common-sense approach to
    reforming the Medicaid program, and it was in serious need of
    reform.
    	As always, I am looking forward to a more cooperative and
    productive conversation on this topic today and to working with
    my colleagues to come up with additional effective solutions to the
    problems that I am sure we will hear addressed in this hearing
    today.
    	Again, I would like to thank the witnesses on the panels that
    will testify and we look forward to hearing your testimony.
    	I would like at this time to recognize my colleague from
    California.  She is a Congressman from the Los Angeles area, I
    believe, and we are pleased that she would travel so far to be with
    us here today, the Honorable Congresswoman Hilda Solis, and she
    is recognized for 5 minutes for her opening statement.  Ms. Solis.
    	[The prepared statement of Nathan Deal follows:]

    PREPARED STATEMENT OF THE HON. NATHAN DEAL, A
    REPRESENTATIVE IN CONGRESS FROM THE STATE OF GEORGIA

    ?	The Committee will come to order, and the Chair recognizes
    himself for an opening statement.
    ?	This morning will hold the second session of a two-day field
    hearing entitled "Examining the Impact of Illegal Immigration
    on the Medicaid Program and Our Healthcare Delivery
    System."
    ?	Today, we will hear from three panels of distinguished and
    expert witnesses about the impact that illegal immigration is
    having on our healthcare delivery system and get their
    perspective on a few recent legislative provisions that were
    produced by this Committee in an effort to help address this
    ever-growing problem.
    ?	Given that there are well over 11 million illegal aliens
    currently residing in the United States and the fact that this
    number is rapidly growing every day that we allow our borders
    to remain unsecured and our immigration laws to remain
    unenforced, there is no question that the problem of illegal
    immigration is one of the most important public policy debates
    currently before Congress.
    ?	I stand with my Republican colleagues in House in strong
    support of enacting an immigration reform bill that does what
    the American people expect and deserve.
    ?	We want to strengthen our borders and enforce our
    immigrations laws.  Because as any healthcare provider will
    tell you, an ounce of prevention is worth a pound of cure.
    ?	Unfortunately, it is clear that those on the other side of the
    issue have absolutely no plan for securing our borders and no
    plan for stopping the flood of illegal immigration that is so
    negatively impacting our public safety, our children's schools,
    and our healthcare system.
    ?	In 1996, Congress responded to the will of the people and
    passed the "Illegal Immigration Reform and Immigrant
    Responsibility Act," and one of the main provisions of this
    legislation was to limit all Federal benefits, including
    Medicaid coverage, to those who are lawfully in the United
    States.
    ?	Of course, people on the other side of this issue opposed this
    provision back then because they believed that your hard-
    earned tax dollars should go to pay for healthcare services for
    people that are in your country illegally.
    ?	And it is a lot of these same people that are now opposing our
    efforts to ensure that only citizens get access to taxpayer
    funded benefits.
    ?	The most unfair thing about what our opponents are
    advocating is that an illegal immigrant on Medicaid would
    almost certainly have a better healthcare benefits package than
    what is available to most of the taxpayers who are paying for
    those Medicaid benefits.
    ?	 Of course, we are not just sitting back and waiting on a single
    comprehensive legislative solution to pass both Houses of
    Congress.  We intend to address this problem whenever and
    wherever we can.
    ?	To help address the negative impact of illegal immigration on
    our healthcare system, the Energy and Commerce Committee
    produced two important provisions in the Deficit Reduction
    Act of 2005, which is commonly known as the "DRA."
    ?	One of the provisions that I authored and fought to include in
    the DRA was a provision that requires States to obtain
    documentary evidence that the person applying for Medicaid
    benefits is actually a U.S. citizen, as required by law.
    ?	This is not a new concept for government programs, since the
    Medicare and SSI programs both require proof of citizenship
    for all beneficiaries.  It's just that Medicaid hadn't been
    seriously reformed since the 1960's and was a little behind the
    times.
    ?	Before the enactment of this provision, the Inspector General
    of the Department of Health and Human Services found that
    46 states and the District of Columbia allowed self-declaration
    of citizenship for Medicaid eligibility, and 27 of those States
    never verified any citizenship statements at any point.
    ?	This means that people simply had to say that they were
    citizens, in whatever language they chose to say it in, and they
    would be eligible for thousands of dollars of taxpayer funded
    Medicaid benefits.
    ?	This was simply unacceptable.
    ?	Of course, the advocates on the other side of this issue fought
    very hard to prevent this provision from being included in the
    DRA and they fought very hard to defeat this needed
    legislation when it was being voted on by Congress.
    ?	And now, these same advocates are fighting just as hard to
    weaken this common-sense provision as much as possible, but
    it is my hope that those implementing this provision will stand
    firm on this important issue.
    ?	Another provision we included in the Deficit Reduction Act
    was a provision to allow States the flexibility to impose
    increased cost-sharing on healthcare services furnished in an
    emergency room that a physician determines is not a real
    medical emergency, such as an ear infection or strep throat.
    ?	To protect beneficiaries, this provision requires that an
    available and accessible alternative must be available to the
    beneficiary and the treating hospital must refer the individual
    to that alternative site in order for the co-pay to be charged.
    ?	Like the citizenship-verification provision, this provision is
    designed to eliminate millions of dollars of waste in the
    Medicaid system by helping to ensure that Medicaid patients
    receive care in the appropriate setting.
    ?	This provision also helps patients.  Studies have also shown
    that patients who receive care in the appropriate setting have
    better healthcare outcomes.
    ?	As we all know, the ER is not the best place to receive primary
    care services or preventative healthcare services.
    ?	Although this provision only applies to Medicaid beneficiaries,
    it will also help reduce some of the negative impact of illegal
    immigrants improperly utilizing the ER by providing $50
    million in grant funding to the States to establish alternative
    non-emergency providers in communities across the United
    States.
    ?	In addition to the increased number of alternative non-
    emergency providers, this provision will also make hospital
    personnel more familiar and comfortable with referring non-
    emergency patients to the appropriate healthcare providers.  It
    will also increase communication between ER personnel and
    these non-emergency providers.
    ?	The logic behind this provision is also simple.  It costs
    approximately $340 to care for a non-emergency patient in the
    emergency department while it costs less than $70 to care for
    the same patient in a health clinic or physician's office.
    ?	That means over five people can be treated in a physician's
    office for less money than one person can be seen in the ER.
    ?	Again, I believe that this is a common-sense approach to
    reforming a Medicaid program that is in serious need of
    reform.
    ?	As always, I am looking forward to having a cooperative and
    productive conversation on this topic today and to working
    with my colleagues to come up with effective solutions to the
    problems addressed at this hearing.
    ?	Again, I would like to thank all of our witnesses for
    participating today.  We look forward to hearing your
    testimony.
    ?	With that, I would like to recognize The Honorable
    Congresswoman from California, Ms. Solis, for 5 minutes for
    an opening statement.

    	MS. SOLIS.  Thank you very much, Mr. Chairman, and good
    morning also to the panelists and to the audience.
    	I represent the 32nd Congressional District in Los Angeles, and
    yes, it was quite a challenge coming into your district here, but I
    felt very welcomed and yesterday, I spent some time in the area of
    Dalton to see how prosperous and how this community is thriving.
    So my hat is off to the mayor and to the citizens here for the
    economic building that I see going on here in your community.
    	On behalf of the Ranking Member John Dingell and my other
    Democratic colleagues on the Committee, I want to thank the
    community of Dalton for hosting this very important meeting
    today.
    	Today's hearing is delaying and distracting the American
    people from the real issues at hand--the refusal of the Republican
    Congress and President Bush to enact comprehensive reform.
    Instead, my counterparts want to blame immigrants for driving up
    the cost of healthcare--in my opinion, a false claim.  The
    overwhelming majority of evidence shows that immigrants,
    regardless of status, use less healthcare services than U.S. citizens.
    In 2003, healthcare costs by U.S. born citizens were more than
    double that of immigrants.  For example, although emergency
    rooms are one of the few available healthcare venues for the
    undocumented, immigrants use emergency rooms less than non-
    immigrants, only 6.3 percent of non-citizens used hospital
    emergency services in 2003, compared to 31.8 percent of U.S.
    citizens.
    	The real problem with our health system is not immigrants, but
    the fact that the system is broken.  Too many uninsured.  In
    America alone, 46 million Americans lack any form of healthcare
    coverage, 6 million more than when President Bush took office in
    2001.  Too little funding for community care and folks on the other
    side of the aisle have consistently tried to cut funding for
    healthcare programs.  Too few jobs that offer healthcare benefits.
    The number of employers offering coverage, as we know, has
    declined significantly over the last few years.
    	If Georgia had an influx of New Yorkers, Oklahomans, or
    Californians, rather than Mexicans, Koreans, or Salvadorans, the
    problem it is facing would still be similar.  That is because the root
    of our healthcare problems remains unchanged.  Many businesses
    cannot afford healthcare insurance.  Many low-wage workers
    cannot afford to purchase insurance, even if it is offered.  And
    many of our healthcare organizations are not receiving the Federal
    support they need to provide quality care.  Forcibly removing
    immigrants from the U.S. or inhumanely denying them needed
    healthcare will not solve the healthcare problems.  In fact,
    providing a legitimate pathway to allowing immigrants to work
    hard to earn their citizenship will provide them with better health
    insurance options and better incomes to afford insurance, possibly
    reducing the number of uninsured.
    	The contributions of undocumented immigrants and the
    benefits they provide to the U.S. economy more than balance the
    meager healthcare resources which they are eligible to receive.  In
    fact, the Social Security Administration has reported $56 billion in
    earnings that are often attributed to immigrants, earnings that help
    to generate $6 billion to $7 billion to the Social Security tax
    revenue, and an additional $1.5 billion in Medicare taxes.
    	More than 60,000 immigrants serve currently in active duty in
    our U.S. armed forces, including more than 35,000 who are green
    card holders, they are not U.S. citizens.
    	Undocumented immigrants contribute at least $300 billion to
    the U.S. gross national product annually.
    	In this politically contentious time, we must not lose sight of
    the issue at hand.  Our primary obligation as elected officials is to
    protect the American people and to protect our borders.  If
    Republicans had not repeatedly defeated our efforts to enhance
    border security over the last 4 years, there would be 6,600 more
    Border Patrol agents, 14,000 more detention beds, and 2,700 more
    immigration enforcement agents along our border than now exist.
    Apprehension of undocumented individuals at the border has
    dropped by 31 percent under President Bush, compared to
    President Clinton's record.  And in 2004, folks, only three
    employers were fined for work site immigration violations--only
    three.
    	Republicans control the White House, the Senate, and the
    House of Representatives.  And yet, due to the in-fighting on the
    other side of the aisle, in my opinion, they have failed to pass an
    immigration bill.
    	My colleagues on the other side of the aisle must stop stalling
    and help us deliver real immigration reform that provides security
    at our borders, helps to enhance the process so that individuals can
    work here that need to work here to help communities like Dalton
    continue to thrive.
    	And I would ask for that courtesy, that we have a civil
    discussion about this issue.
    	And again, I want to thank the panelists and the Chairman and
    the folks here in Dalton for inviting me to be here at this very
    important hearing.
    	Thank you very much, yield back.
    	MR. DEAL.  Thank you.  It is my pleasure now to introduce my
    colleague, who joins my district from the 9th District of Georgia,
    the Honorable Charlie Norwood, who is also a member of our
    Health Subcommittee.
    	MR. NORWOOD.  Thank you very much, Mr. Chairman.  I
    appreciate you having this hearing, and especially appreciate you
    having this hearing in Georgia.
    	We welcome our great panel of witnesses and it is a great
    delight to see so many Georgians participating in this today.
    Unlike in Washington when we have these, I cannot understand
    half the people in the audience, but I can understand most
    everybody in this room.  So welcome, we are happy to see you
    here.
    	I want to, Mr. Chairman, if I may, re-remind myself of what
    this hearing is.  This hearing is not about immigrants, this hearing
    is about illegal immigrants--
    	[Applause.]
    	MR. NORWOOD.  --who are breaking our laws by entering our
    country, who are breaking our laws by using bogus papers, who
    are breaking our laws by trying to get onto Medicaid that is
    designed by the American taxpayer to help the American citizens,
    not foreigners who are in our country illegally.
    	[Applause.]
    	MR. NORWOOD.  Mr. Chairman, illegal aliens are placing a
    huge burden on our health system, we all know that.  While illegal
    aliens enjoy these benefits, we have Americans that are forced to
    bear the entire cost of their healthcare in their own family.  Take
    Medicaid as an example.  The State of Georgia admitted they
    legally spent $88 million on emergency services for illegal aliens
    in 2005, $88 million.  This demonstrates just how widespread the
    problem is in Georgia, since we really actually have no idea how
    much was actually spent on all of the services for illegal aliens any
    more than we have any idea how many illegal aliens use hospital
    services.  The reason we do not is hospitals simply do not question
    people and ask them are you a citizen or not.  So any numbers
    thrown out here today regarding that, of course, are bogus because
    nobody, including me, knows the answer to that.
    	Illegal aliens are not supposed to get routine Medicaid benefits.
    That has been the law of this land since 1986.  That is not
    something we have just dreamed up yesterday.  It is the law of the
    land.  The problem is that in recent years, CMS encouraged self-
    declaration, which allowed people to be accepted as U.S. citizens
    simply because they said so.  And we wonder why States are
    seeing their Medicaid expenses soaring.  According to the
    Inspector General over at Health and Human Services, 46 States
    and the District of Columbia allow self-declaration of U.S.
    citizenship for Medicaid.  That is against the Federal law to do
    that.  I will put that in simple terms.  An illegal alien could have
    walked into 46 States and the District of Columbia and say that
    they were a citizen and no one asked any other questions, 27 States
    did not verify citizenship at any point, even after benefits were
    provided.
    	We changed that through Section 6082 of the Deficit
    Reduction Act, and I am very pleased that we did.  Now the
    supporters of open borders will say that the old way of business
    was just fine, they might argue that 44 of these States require
    evidence of citizenship if statements seemed questionable.  Were
    those States approving profiling based on accents and
    appearances?  I have no clue how a reasonable person could
    conclude someone is illegal without asking for proof of citizenship.
    	Now I am not interested in discriminating against anyone, that
    is exactly why we should ask for documents from everyone that
    applies for Medicaid benefits.  Remember what we are doing.  A
    person comes in and says I need free healthcare.  I want the
    citizens of America to furnish me healthcare, that is what you are
    asking for.  Is it too much for us to ask could you please identify
    yourself, could you please determine if you are a citizen before the
    taxpayers of this country pay for your healthcare and Medicaid that
    is better than many citizens, working American citizens have in
    their own healthcare?  I do not think it is too much.
    	I am also proud that CMS implemented this provision in a way
    that will see that citizens are accommodated.  If you are on
    Medicare, you have met the standard.  If you are on Social Security
    disability, you have met the standard.  If you can produce one of
    dozens of documents to prove citizenship and identify, you have
    met the standard.  We are also talking about emergency care.  This
    provision does not even touch EMTALA.  We will get into that, I
    am sure.
    	Nine groups of qualified illegal aliens have qualified for
    Medicaid, including permanent residents, battered alien women,
    and victims of human trafficking.
    	Mr. Chairman, what we faced was the outright theft of
    healthcare benefits for the low-income Americans by illegal aliens.
    We have heard the falsehood that illegal aliens only take jobs that
    American do not want.  Are we now also saying they are only
    taking healthcare benefits that Americans do not want?  The U.S.
    citizens that are losing Medicaid coverage will tell you they really
    need and want those benefits.
    	Mr. Chairman, I am glad this field hearing will further allow
    each party to declare where they stand--on the side of their low-
    income constituents, or on the side of the illegal aliens.  Maybe
    some folks have no problem pandering to civil violators who add
    to our crimes by swindling taxpayers; maybe they do not
    understand that the match system and State balanced budgets limit
    how much money there is to go around.  Fewer poor American
    citizens get Medicaid because illegal aliens get Medicaid.  It is just
    that simple.  Our provision, and what Georgia did even before we
    enacted it, will bring integrity back to our certification system for
    Medicaid.
    	And with that, Mr. Chairman, I thank you for the time.
    	[Applause.]
    	MR. DEAL.  Thank you.
    	I will now ask our participants in the first panel if they would
    please come to the podium.
    	I am pleased to introduce some distinguished members of the
    Georgia State Senate, who have already been alluded to as leaders
    in an immigration reform package that passed the legislature of our
    State.  In the estimation of most who have looked at the package of
    legislation that you gentlemen helped pass, it makes Georgia really
    the leader on this whole issue in the country, and we appreciate
    your efforts.
    	We have a third panelist who has been invited and was
    expected to be here and--
    	MS. SOLIS.  He is here, I believe he is here.
    	MR. DEAL.  Oh, he is?
    	MS. SOLIS.  Mr. Thompson.
    	MR. DEAL.  All right.
    	First of all, I would like to introduce the Honorable Casey
    Cagle, who is a Member of the Georgia State Senate and represents
    the area on the eastern side of my Congressional District of Hall
    and Jackson Counties.  Then, of course, the real leader of the
    legislation in the State General Assembly, the Honorable Chip
    Rogers from Atlanta, Georgia, and the Honorable Curt Thompson,
    who is also a Member of the State Senate from Atlanta.
    Gentlemen, we are pleased to have all of you here today, I look
    forward to your testimony and each of you will be given 5 minutes
    to make oral presentations.  Your written testimony has already
    been made a part of the record.  We will begin with you, Mr.
    Cagle.

    STATEMENTS OF THE HON. CASEY CAGLE, MEMBER, GEORGIA STATE SENATE; THE HON.
    CHIP ROGERS, MEMBER, GEORGIA STATE HOUSE OF REPRESENTATIVES; AND THE HON. CURT
    ROGERS, MEMBER, GEORGIA STATE SENATE

    	MR. CAGLE.  Thank you, Mr. Chairman and members of the
    Committee.  It is indeed an honor to be before you today in a
    wonderful part of our State here in Dalton, and I appreciate you
    taking the time and the sacrifice to hear our comments today.
    	The impact of illegal aliens on our healthcare system represents
    one of the most important physical challenges facing Georgia.
    However, I would say at the outset, the real issue at hand here is
    not the cost of healthcare at all.  Instead, it is the failure of the
    Federal government to properly secure America's borders.
    	As Americans, we are a Nation of immigrants.  No one wants
    to deny individuals who obey the law and follow the process an
    opportunity to have a shot at the dream of American citizenship.
    All we are saying is that those who choose to break the law and
    come here illegally should not receive taxpayer benefits as a result
    of doing so.  Americans do not assume that we can illegally enter
    other countries and require them to give us benefits.  We are
    simply asking the citizens of other nations to follow the same rules.
    	Unfortunately, Federal policies for the last several decades
    have encouraged foreign citizens not to follow the rules.  Our
    unsecured borders have resulted in millions of citizens of other
    countries coming to America illegally.  And these foreign nationals
    often need or want a broad range of social services when they
    arrive in individual States.  This situation leaves State governments
    holding the bag for a problem that the Federal government has,
    quite candidly, utterly failed to solve.
    	I would therefore begin my remarks by urging Congress, in the
    strongest possible terms, to seal our borders.  Unless and until we
    have secure borders and an immigration system that makes sense,
    any solution we find on social services or service issues such as
    healthcare will be a mere Band-Aid.
    	Senator Isakson, Congressman Deal, and Congressman
    Norwood have shown strong leadership on this front and I hope
    they are successful in encouraging their colleagues to put border
    security first.
    	Having said that, the issue of dealing with the impact of illegal
    aliens on the healthcare system is a significant one for Georgia.  At
    its heart, the issue is one of basic fairness.  Every day, citizens
    across Georgia find ourselves facing major healthcare problems
    that strain our financial resources.  Maybe it is a young child being
    diagnosed with a cancer that is only covered at 80 percent by their
    healthcare plan.  Or perhaps it is a senior citizen being forced to
    sell all of their worldly possessions in order to obtain affordable
    long-term care.  Perhaps it is a family canceling a summer vacation
    in order to cover a sudden rise in insurance premiums.  The bottom
    line is that for many everyday Georgia citizens, affordable
    healthcare coverage is rapidly becoming unreachable.  After
    providing for their families, paying their taxes, and doing
    everything else that good citizens do, these working families find
    themselves unable to qualify for government-funded healthcare;
    yet, unable to pay for private healthcare insurance.
    	Now think about what happens when the same family learns
    that healthcare costs in Georgia are being significantly increased
    by the cost of providing free or subsidized care to citizens of other
    nations who broke Federal law to come here.  The response from
    everyday Georgians is outrage.  Our citizens are outraged because
    this kind of system is patently unfair.
    	We work hard every day to pay taxes and we deeply resent
    seeing those taxes siphoned off to provide free healthcare to aliens
    who come here illegally.  I realize there are some people in
    Congress who think our outrage at this situation is wrong.  I would
    just say that perhaps these folks would feel differently if they were
    forced to give up their taxpayer-funded health benefits and
    experience first hand the strain that rising healthcare costs put on
    Georgia families every day.
    	Based on the feedback I get from my constituents every day, I
    commend those in Congress who are working to ensure the
    taxpayer-funded Medicaid system benefits only individuals who
    are in American legally.  Taking reasonable steps to reduce the
    burden illegal aliens place on Medicaid significantly and our
    hospitals generally is a virtual necessity in order for our State to
    maintain a sound financial footing.
    	Of course, the challenge here is identifying individuals who are
    here illegally in the context of providing healthcare.  We obviously
    do not want to have any kind of system in place that makes it
    difficult for individuals with urgent healthcare needs to receive
    emergency treatment.  We can and must ensure that our hospital
    facilities continue to offer lifesaving stabilization and care to
    anyone who arrives at their doors, regardless of how they got there.
    However, when our emergency rooms become primary care
    facilities of last resort for the non-urgent medical needs of illegal
    aliens, we have a problem.  And the only way to solve that
    problem is to take steps to identify illegals and prevent them from
    obtaining free medical care paid for by American citizens.
    	At this point, the challenge becomes identifying illegal aliens
    prior to healthcare delivery.  More than anything else, this
    represents the most contentious part of this debate.  Because
    identifying members of a population that explicitly seeks to hide
    their identity represents a very difficult challenge.  However, I
    believe we can and should meet that challenge by putting a basic
    identification system in place to ensure taxpayer-funded benefits
    are going only to legal citizens.
    	An argument frequently raised is that requiring citizenship
    verification for Medicaid benefits requires paperwork that can be
    difficult to fill out.  In response to that argument, I would simply
    say getting any kind of healthcare in our current system involves
    often complex paperwork.  We can and should focus on
    streamlining that paperwork, but to argue that illegal aliens from
    other nations deserve a process that is easier to handle than
    American citizens is absurd.
    	Individuals on Medicaid are receiving a valuable commodity
    from the Government.  And asking for basic identification as a
    prerequisite represents a common sense policy supported by the
    vast majority of Georgia citizens.  We require identification in
    order to drive a car, rent a movie, or purchase alcohol.  There is
    simply no legitimate public policy reason not to make the same
    requirement a basic threshold for receiving taxpayer-funded
    healthcare.
    	In summary, I urge Congress to act immediately to seal our
    borders and ensure that the only individuals in our country are
    those who come here legally.  Until we can achieve this goal, I
    strongly support efforts to prevent illegal aliens from receiving
    non-emergency health benefits paid for by hospitals themselves or
    taxpayer-funded.
    	Thank you, Mr. Chairman, members of the Committee.
    	[Applause.]
    	MR. DEAL.  Thank you, Senator Cagle.
    	Senator Rogers, you are recognized for 5 minutes.
    	[The prepared statement of Casey Cagle follows:]

    PREPARED STATEMENT OF THE HON. CASEY CAGLE, MEMBER,
    GEORGIA STATE SENATE

            The impact of illegal aliens on our healthcare system represents
    one of the single most important fiscal challenges facing Georgia.
            However, I would say at the outset that the real issue at hand
    here is not the cost of health care at all.  Instead, it is the failure of
    the federal government to properly secure America's borders.
            As Americans, we are a nation of immigrants.  No one wants to
    deny individuals who obey the law and follow the process an
    opportunity to have a shot at the dream of American citizenship.
    All we are saying is that those who choose to break the law and
    come here illegally should not receive taxpayer benefits as a result
    of doing so.  Americans do not assume that we can illegally enter
    other countries and require them to give us benefits.  We are
    simply asking the citizens of other nations to follow the same rules.
            Unfortunately, federal policies for the last several decades have
    encouraged foreign citizens not to follow the rules.  Our unsecured
    borders have resulted in millions of citizens of other countries
    coming to America illegally.  And, these foreign nationals often
    need or want a broad range of social services when they arrive in
    individual states.  This situation leaves state governments holding
    the bag for a problem that federal government has abjectly and
    utterly failed to solve.
            I would therefore begin my remarks by urging Congress in the
    strongest possible terms to seal our borders.  Unless and until we
    have secure borders and an immigration system that makes sense,
    any solution we find on social service issues such as health care
    will be a mere band-aid.  Senator Johnny Isakson, Congressman
    Nathan Deal and Congressman Charlie Norwood have shown
    strong leadership on this front, and I hope they are successful in
    encouraging their colleagues to put border security first.
            Having said that, the issue of dealing with the impact of illegal
    aliens on the healthcare system is a significant one for Georgia.  At
    its heart, the issue is one of basic fairness.
            Every day, citizens across Georgia find ourselves facing major
    healthcare problems that strain our financial resources.   Maybe it's
    a young child being diagnosed with a cancer that's only covered at
    80% by a health plan.  Or, perhaps it's a senior citizen being forced
    to sell all of their worldly possessions in order to obtain affordable
    long term care.  Perhaps it is a family canceling a summer vacation
    in order to cover a sudden rise in insurance premiums.
            The bottom line is that for many everyday Georgia citizens,
    affordable healthcare coverage is rapidly becoming unreachable.
    After providing for their families, paying their taxes and doing
    everything else that good citizens do, these working families find
    themselves unable to qualify for government funded healthcare,
    yet unable to pay for private health insurance.
            Now, think about what happens when the same family learns
    that health care costs in Georgia are being significantly increased
    by the cost of providing free or subsidized care to citizens of other
    nations who broke federal law to come here.
            The response from everyday Georgians is outrage.  Our
    citizens are outraged because this kind of system is patently unfair.
    We work hard every day to pay taxes, and we deeply resent seeing
    those taxes siphoned off to provide free health care to aliens who
    come here illegally.
            I realize there are some people in Congress who think our
    outrage at this situation is wrong.  I would just say that perhaps
    these folks would feel differently if they were forced to give up
    their taxpayer funded health benefits and experience firsthand the
    strain that rising healthcare costs put on Georgia families every
    day.
            Based on the feedback I get from my constituents every day, I
    commend those in Congress who are working to ensure the
    taxpayer funded Medicaid system benefits only individuals who
    are in America legally.  Taking reasonable steps to reduce the
    burden illegal aliens place on Medicaid specifically - and our
    hospitals generally - is a virtual necessity in order for our state to
    maintain a sound financial footing.
            Of course, the challenge here is identifying individuals who are
    here illegally in the context of providing health care.
            We obviously do not want to have any kind of system in place
    that makes it difficult for individuals with urgent healthcare needs
    to receive emergency treatment.  We can and must ensure that our
    hospital facilities continue to offer lifesaving stabilization and care
    to anyone who arrives at their doors, regardless of how they got
    there.
            However, when our emergency rooms become primary care
    facilities of last resort for the non-urgent medical needs of illegal
    aliens, we have a problem.  And, the only way to solve that
    problem is to take steps to identify illegals and prevent them from
    obtaining free medical care paid for by American citizens.
            At this point, the challenge becomes identifying illegal aliens
    prior to health care delivery.  More than anything else, this
    represents the most contentious part of this debate, because
    identifying members of population that explicitly seek to hide their
    identities represents a very difficult challenge.  However, I believe
    we can and should meet that challenge by putting a basic
    identification system in place to ensure taxpayer funded benefits
    are going only to legal citizens.
            An argument frequently raised is that requiring citizenship
    verification for Medicaid benefits requires paperwork that can be
    difficult to fill out.  In response to that argument, I would simply
    say getting any kind of healthcare in our current system involves
    often complex paperwork.  We can and should focus on
    streamlining that paperwork, but to argue that illegal aliens from
    other nations deserve a process that is easier to handle than
    American citizens is absurd.  Individuals on Medicaid are
    receiving a valuable commodity from the government, and asking
    for basic identification as a prerequisite represents a common sense
    policy supported by the vast majority of Georgia citizens.
            We require identification in order to drive a car, rent a movie,
    or purchase alcohol.  There is simply no legitimate public policy
    reason not to make the same requirement a basic threshold for
    receiving taxpayer funded health care.
            In summary, I urge Congress to act immediately to seal our
    borders and ensure that the only individuals in our country are
    those who come here legally.  Until we can achieve this goal, I
    strongly support efforts to prevent illegal aliens from receiving
    non-emergency health benefits paid for by hospitals themselves or
    taxpayer funds.
            Thank you.

            MR. ROGERS.  Thank you, Mr. Chairman and members of the
    Committee.  Thank you for allowing me to address you today on
    what I believe is the most important domestic issue facing the
    United States; and that is the impact of our unsecured borders on
    the citizens of this Nation.
    	While many questions surrounding illegal entry into our Nation
    are debatable, I would like to start my testimony with a few that
    are not.
    	The United States government has an obligation to secure our
    borders for its citizens.  Any entry into the United States through a
    point other than a legal port of entry is a violation of these borders.
    Likewise, any foreign national remaining in the United States for a
    time beyond the granted legal stay is in violation of our Nation's
    immigration laws.
    	Now why would a foreign national enter the United States
    through a means other than a legal port of entry or remain in the
    United States for a time in excess of his or her legal stay?  I believe
    the answers are many, but fall mainly into two easily defined
    categories--employment and taxpayer-supported benefits.
    Therefore, any proposal that seeks to fulfill the responsibility of
    the United States government to secure our borders must include
    measures to eliminate the attraction of illegal entry.
    	With respect to the enforcement of employment laws, the
    Department of Homeland Security has all but stopped any effort to
    uphold the current law.  The number of companies fined for hiring
    illegal workers dropped from 417 back in 1999 to just 3 in 2004.
    The result of this failure to enforce the law has been millions of
    additional illegal aliens present in our Nation.  Many, but not all,
    of these illegal aliens are hired by criminal employers and
    invariably use taxpayer-funded services that are reserved for
    United States citizens and persons lawfully present in the United
    States.
    	This brings us to the second necessary area of enforcement--
    taxpayer-supported benefits.  While the Federal government is
    charged with the constitutional duties of national defense and the
    general welfare of this Nation, it is the States and the local
    governments that primarily administer taxpayer supported benefits.
    When considering the demands on our social safety net brought on
    by the presence of illegal aliens, it is clear that the financial impact
    is actually much greater on the States and the local governments.
    It is fact the States that pay for those particular services that are
    most demanded by illegal populations, including education, law
    enforcement, and today's topic, healthcare services.
    	You will likely hear from many witnesses today that can debate
    the financial impact of illegal immigration.  Economists are easily
    found who will confirm that illegal immigration is in fact a
    significant financial drain on our economy.  You may find a few
    who actually believe that the importation of millions of unskilled
    and uneducated laborers is actually good for our system.  But
    regardless of the financial numbers, the question to be asked by
    elected officials is not whether it is profitable, but is it fair.
    	Current Federal law, Title 8, Chapter 14, Sections 1611 and
    1621, clearly define that a person not lawfully present in the
    United States is ineligible to receive almost all taxpayer-funded
    benefits.  The few exceptions include emergency services and
    medical services to treat the symptoms of communicable diseases.
    In other words, the Federal law establishes the threshold of
    eligibility to receive taxpayer-funded benefits for non-U.S.
    citizens.
    	This, I believe, brings us to the critical question that must be
    answered if you believe illegal aliens should receive taxpayer-
    supported benefits.  And that is, if a foreign national, who is in
    violation of U.S. immigration law is granted the right to receive
    taxpayer-funded benefits without meeting eligibility requirements,
    then why is the same exception not extended to American citizens?
    	In the State of Georgia, we have a wonderful program designed
    to pay for health insurance for children of poor families.  This
    program is known as Peachcare.  Should I, as a U.S. citizen and a
    Georgia resident, be required to meet the eligibility requirements to
    receive this benefit?  Clearly the answer is yes.  The failure to
    enforce this eligibility requirement means that I will receive
    taxpayer-supplied heath insurance for my children at the expense
    of those who do legally qualify.
    	What about a U.S. citizen from the State of Alabama?  She he
    or she be required to meet the eligibility requirements of Georgia
    residency before receiving Georgia Medicaid benefits?  Clearly
    again, the answer is yes.  And again, the failure to enforce this
    eligibility requirements results in fewer benefits for legally eligible
    Georgians.
    	So if we have established the fact that U.S. citizens from
    Georgia and any other State must meet the eligibility requirements
    to receive taxpayer benefits, then how can we possibly suggest that
    a foreign national illegally present in the United States should not
    also meet those same eligibility requirements.
    	Unlike the Federal government, most States, including
    Georgia, have a balanced budget requirement.  And under a
    balanced budget requirement, when a taxpayer benefit is given to
    an ineligible recipient, then by definition that benefit must be
    denied to an eligible recipient.
    	Let me illustrate this in real life terms.  In Georgia today, there
    are 12,700 children with severe physical disabilities, adults with
    mental retardation, and frail and elderly citizens who are on a
    waiting list for community-based services.  These are 12,700 legal
    U.S. citizens who already qualify for our help, but are being denied
    because of a lack of funding.  Each time a dollar is given to a
    person who does not qualify to receive it, that same dollar cannot
    be given to one of these 12,700 Georgians who are currently on the
    waiting list.
    	One final example of the inequities created by ignoring our
    immigration law; it is called the priority group 8g.  Military
    veterans may be familiar with this designation.  The Veterans'
    Administration annually places our United States veterans into
    distinct categories so as to determine who will receive medical
    care.  This despite the fact that this medical care to which I refer
    was already promised these veterans upon their agreeing to serve
    our Nation's armed forces.  The current group 8g is no longer
    eligible to receive the promised care because veterans in this group
    had the audacity to go out and make more than $31,000 back in
    2004, and they had no service-related ailments.
    	Yet at the same time, a foreign national may illegally enter the
    United States, present no documentation to verify lawful status or
    income, and immediately receive those taxpayer-funded medical
    care services that should have gone to the United States veterans
    that are in group 8g.  This bring me back to my earlier question:  Is
    the current policy fair?
    	One of the eligibility requirements to receive non-emergency
    taxpayer-supported healthcare benefits is to be lawfully present in
    the United States.  This would lead one to believe that surely the
    individual States are verifying the lawful status prior to giving
    away the taxpayers' money.  Sadly, the answer is no, they are not.
    	Only four States--Montana, New York, New Hampshire, and I
    am proud to say Georgia--require proof of citizenship to receive
    Medicaid benefits.
    	However, there is good news.  Under the newly enacted Deficit
    Reduction Act, the requirement for proof of citizenship to receive
    Medicaid benefits is now going to be enforced nationwide.
    Additionally, this new law will remove the misguided policy of
    deducting indigent care expenses for illegal aliens from the States'
    Medicaid funds.  Georgia thanks you for this legislation.
    	Is the Deficit Reduction Act good public policy?  Clearly, it is.
    As a taxpayer, we must all have the simple expectation--the simple
    expectation--that our taxpayer dollars are being used for only a
    lawful purpose.  When false identification or lack of verification
    allows taxpayer dollars to be diverted to ineligible recipients, it is
    not a lawful purpose.
    	In Georgia, we have gone one step further.  Under the new
    Georgia Security and Immigration Compliance Act, we will begin
    verifying the eligibility of all adult applicants for all taxpayer-
    supported benefits.
    	Let me be very clear here, the State of Georgia does not
    establish the criteria for qualifying for benefits.  With respect to
    illegal aliens, Congress and President Bill Clinton established
    those criteria in 1996.  Under Georgia law, we will simply verify
    eligibility.  We will do so using the SAVE program that is offered
    to us by the United States Citizenship and Immigration Services.
    This electronic verification system will allow us to almost instantly
    verify the eligibility of any alien seeking taxpayer-supported
    benefits.
    	The requirement in Georgia to verify eligibility will ultimately
    mean that taxpayer benefits go to only those who meet the
    eligibility requirements.  Does this mean the State will save
    money?  Not necessarily.  But what it will mean is that Georgians
    can trust that their taxpayer dollars are only going to persons
    legally eligible to receive them.
    	Finally, I will address the specific issue of taxpayer-supported
    non-emergency healthcare benefits to illegal aliens.  Please note--
    and this is very important--you will hear a number of witnesses
    refer to a denial of healthcare rather than a denial of taxpayer-
    supported healthcare benefits.  I believe characterizing this issue as
    simply a denial of healthcare is completely and totally inaccurate.
    	Any person, regardless of legal status, may purchase healthcare
    without the assistance of the taxpayers.  Millions of American
    citizens do that each and every week.  Additionally--and I address
    this to our medical professionals in the audience--any doctor or
    medical facility can simply give away their medical care.  There is
    no requirement that they force somebody to pay for it.  Again, free
    medical care can be found all across this Nation.
    	The question we are faced with today is very simple.  If a
    person, legal or illegal, asks the taxpayers of this Nation to pay for
    his or her medical care, do the taxpayers have a right to expect that
    that person be eligible to receive the benefits?  As an elected
    official and as a taxpayer, I hope you would all agree the answer is
    yes.
    	Again, I thank you for allowing me the opportunity to appear
    before you today to discuss this important issue.  I will be glad to
    answer any questions pertaining to illegal immigration or the new
    Georgia law which seeks to limit the impact of illegal immigration
    on our State.
    	[Applause.]
    	[The prepared statement of Chip Rogers follows:]

    PREPARED STATEMENT OF THE HON. CHIP ROGERS, MEMBER,
    GEORGIA STATE HOUSE OF REPRESENTATIVES

            Members of the Committee thank you for allowing me to
    address what I believe is the most important domestic issue facing
    the United States of America: the impact of our unsecured borders
    on the citizens of this nation.
            While many questions surrounding the illegal entry into our
    nation are debatable, I would like to start my testimony with a few
    that are not.
            The United States government has an obligation to secure the
    borders for its citizens.  Any entry into the United States through a
    point other than a legal port of entry is a violation of these borders.
    Likewise, any foreign national remaining in the United States for a
    time beyond the granted legal stay is in violation of our nation's
    immigration law.
            Why would a foreign national enter the United States through a
    means other than a legal port of entry or remain in the United
    States for a time in excess of his or her legal stay?
            I believe the answers are many but most fall into two easily
    defined categories: employment and taxpayer-supported benefits.
            Therefore any proposal that seeks to fulfill the responsibility of
    the United States government to secure our borders must include
    measures to eliminate the attraction of illegal entry.
            With respect to enforcement of employment laws, the
    Department of Homeland security has all but stopped any effort to
    uphold current law.  The number of companies fined for hiring
    illegal workers dropped from 417 in 1999 to just 3 in 2004.
            The result of this failure to enforce the law has been millions of
    additional illegal aliens present in our nation.  Many, but not all, of
    these illegal aliens are hired by criminal employers and invariably
    use taxpayer-funded services that are reserved for U.S. citizens and
    persons lawfully present in the United States.
            This brings us to the second necessary area of enforcement:
    taxpayer-supported benefits.
            While the federal government is charged with the constitutional
    duties of national defense and the general welfare of the nation, it
    is the states and local governments that primarily administer
    taxpayer-supported benefits.  When considering the demands on
    our social safety net brought on by the presence of illegal aliens, it
    is clear that the financial impact is actually much greater on state
    and local governments.
            It is in fact the states that pay for those particular services most
    demanded by the illegal population including education, law
    enforcement and, today's topic, health care services.
            You will likely hear many witnesses debate the financial
    impact of illegal immigration.  Economists are easily found who
    will confirm that illegal immigration is a significant financial drain
    on our economy.  You may find a few who actually believe the
    importation of millions of unskilled and uneducated laborers is
    actually good for our system.  But regardless of the financial
    numbers the question to be asked by elected officials is not
    whether it is profitable but rather "Is it fair?"
            Current federal law, Title 8 Chapter 14 sections 1611 & 1621,
    clearly define that a person not lawfully present in the United
    States is ineligible to receive almost all taxpayer-funded benefits.
    The few exceptions include emergency services and medical
    services to treat the symptoms of communicable diseases.
            In other words, the federal law establishes the threshold of
    eligibility to receive taxpayer-funded benefits for non-U.S.
    citizens.
            This, I believe, brings us to the critical question that must be
    answered if you believe illegal aliens should receive taxpayer-
    supported benefits.
            If a foreign national, who is also in violation of U.S.
    immigration law, is granted the right to receive taxpayer-funded
    benefits, without meeting eligibility requirements, then why is this
    same exemption not extended to American citizens?
            In the state of Georgia we have a wonderful program designed
    to pay for health insurance for children of poor families.  The
    program is known as Peachcare.  Should I, as a U.S. citizen and a
    Georgia resident, be required to meet the eligibility requirements to
    receive this benefit? Clearly the answer is yes.  The failure to
    enforce eligibility requirements means that I will receive taxpayer-
    supplied health insurance for my children at the expense of those
    who legally qualify.
            What about a U.S. citizen from the state of Alabama? Should
    he or she be required to meet the eligibility requirement of Georgia
    residency before receiving Georgia Medicaid benefits? Again the
    answer is yes.  And again the failure to enforce the eligibility
    requirements results in fewer benefits for legally eligible
    Georgians.
            So if we have established that U.S. citizens from Georgia, or
    any other state, must meet eligibility requirements to receive
    taxpayer benefits, then how can we possibly suggest that a foreign
    national, illegally present in the United States, should not also meet
    eligibility requirements?
            Unlike the federal government, most states, including Georgia,
    have a balanced budget requirement.  Under a balanced budget
    requirement when a taxpayer benefit is given to an ineligible
    recipient then by definition the benefit must be denied to an
    eligible recipient.
            Let me illustrate this in real life terms.  In Georgia today there
    are 12,700 children with severe physical disabilities, adults with
    mental retardation, and frail and elderly citizens who are on a
    waiting list for community based services.  These are 12,700 legal
    U.S. citizens who already qualify for our help, but are being denied
    because of a lack of funding.
            Each time a dollar is given to a person who by law does not
    qualify to receive it, then that same dollar cannot go to help one of
    these 12,700 Georgians on the waiting list.
            One final example of the inequities created by ignoring
    immigration law: it is called priority group 8g.  Military veterans
    may be familiar with this designation.  The Veterans
    Administration annually places our U.S. veterans into distinct
    categories so as to determine who will receive medical care.  This
    despite the fact that the medical care to which I refer was promised
    to these veterans upon their agreeing to serve in our nation's armed
    forces.  The current group 8g is no longer eligible to receive the
    promised care because veterans in this group made more than
    $31,000 in 2004 and had no service related ailments.
            Yet at the same time a foreign national may illegally enter the
    United States, present no documentation to verify lawful status or
    income, and immediately receive taxpayer-funded medical care.
            This brings me back to my earlier question, "Is it fair?"
            One of the eligibility requirements to receive non-emergency
    taxpayer-supported healthcare benefits is to be lawfully present in
    the United States.  This would lead one to believe that surely the
    individual states are verifying lawful status prior to giving away
    the taxpayers money.  Sadly the answer is, no they are not.
            Only four states, Montana, New York, New Hampshire, and I
    am proud to say, Georgia, require proof of citizenship to receive
    Medicaid benefits.
            However, there is good news.  Under the newly enacted Deficit
    Reduction Act the requirement for proof of citizenship to receive
    Medicaid is to be enforced nationwide.  Additionally, this new law
    will remove the misguided policy of deducting indigent care
    expenses for illegal aliens from the states Medicaid funds.
            Is Deficit Reduction Act good public policy? Yes, it is.  As a
    taxpayer we must all have the simple expectation that our taxpayer
    dollars are being used for a lawful purpose.  When false
    identification, or lack of verification, allows taxpayer dollars to be
    diverted to ineligible recipients, it is not a lawful purpose.
            In Georgia we have gone one step further.  Under the our new
    Georgia Security and Immigration Compliance Act we will begin
    verifying the eligibility of all adult applicants for taxpayer
    supported benefits.
            Let me be clear, the state of Georgia does not establish the
    criteria for qualifying for benefits.  With respect to illegal aliens,
    Congress and President Clinton established those criteria in 1996.
    Under Georgia law we will simply verify eligibility.  We will do so
    using the SAVE program offered to us by the United States
    Citizenship and Immigration Services.  This electronic verification
    system will allow us to almost instantly verify the eligibility of any
    Alien seeking taxpayer-supported benefits.
            The requirement in Georgia to verify eligibility will ultimately
    mean that taxpayer benefits go only to those who meet the
    eligibility requirements.  Does this mean the state will save
    money? Not necessarily.  But it will mean that Georgians can trust
    their taxpayer dollars are going only to persons legally eligible to
    receive them.
            Finally, I will address the specific issue of taxpayer supported
    non-emergency healthcare benefits to illegal aliens.  Please note
    you will likely hear a number of witnesses refer to a denial of
    healthcare rather than a denial of taxpayer supported healthcare
    benefits.  I believe characterizing this issue, as simply a denial of
    healthcare, is inaccurate.
            Any person, regardless of legal status, may purchase healthcare
    without the assistance of the taxpayer.  Millions of American
    citizens do so every week.  Additionally, any doctor or medical
    facility can simply give away medical care.  Again free medical
    care can be found all across our nation.
            The question we are faced with today is simple, if a person,
    legal or illegal, asks the taxpayers to pay for his or her medical
    care, do the taxpayers have a right to expect the applicant to be
    eligible to receive the benefit?
            As an elected official, and a taxpayer, I hope you would agree
    the answer is, yes!
            Again, I thank you for allowing me the opportunity to appear
    before you today to discuss this important issue.  I will be glad to
    answer any questions pertaining to illegal immigration or the new
    Georgia law, which seeks to limit the impact of illegal immigration
    on our state.

            MR. DEAL.  Senator Thompson, you are recognized for 5
    minutes.
    	MR. THOMPSON.  Thank you, Mr. Chairman and thank you all
    for coming down here.  Some of you came farther than others.
    	I would just encourage this Committee to be looking at
    practical solutions to real problems, both when it comes to the
    crisis of illegal immigration as well as the crisis in healthcare that
    faces this country, in that pretty much my district, District 5, is
    ground zero for both.
    	I do represent Georgia's Fifth State Senate District situated
    along the interstate that comes from Gainesville where you will
    also hold a hearing, into Atlanta.  We have some historic areas
    such as the picture postcard railroad depot and town square of
    Norcross, but primarily we live in suburbs begun during the 1970s
    when lots of Atlantans left their town after desegregation and lots
    of northerners left the rust belt after de-industrialization.  Some of
    that rootless suburban population then moved again in the 1990s to
    points further out, taking with them some of the commercial
    infrastructure that had serviced them.  What opened up was space
    for new residents making a home here or African-Americans
    finding a first home in the suburbs, urbanites fleeing the inflated
    home prices in Atlanta's bohemian quarter, and immigrants.
    	My district and the neighborhoods around it are home to as
    diverse a population as one finds in the southeast.  In fact, it is the
    most diverse State Senate seat in the General Assembly here.  In
    our schools, students speak some 120 languages when at home.  I
    have to campaign in English, Spanish, Korean, Hindi, Vietnamese,
    and Mandarin in order to keep my seat.  I have attended Romanian
    Orthodox churches, spoken at Hindu temples, danced Cumbia at a
    Colombian festival, and cut the ribbon at the opening of a high end
    Chinese shopping center.  At dinnertime, I have menu options as
    rich as a Congressional aide living in Adams-Morgan.  I go home
    this evening to a wife who was born in Colombia and I am here to
    tell you that diversity works.
    	When that first wave of suburbanites left for the exurbs in the
    1990s, they took along with them some of the commercial
    infrastructure that had serviced them.  We lost jobs, storefronts
    stood vacant, dollars for development went elsewhere.  With
    declining political clout, our schools got fewer resources, traffic
    worsened, and we had a tough decade or so.
    	We have turned a corner.  We have done the hard work to get
    the broader community to form a community investment entity
    called the Gwinnett Village Community Improvement District, to
    redevelop and market our international community.  We have also
    become a draw to new investment with new major retail outlets
    catering to our diverse community's demands and plans for several
    major new urbanist live-work-shop-play centers including the
    Super Pearl and Super H centers as well as proposals for mixed use
    developments at Gwinnett Place Mall and at the Jimmy Carter
    Boulevard intersection with Interstate 85.  Large investments are
    coming from overseas, including the Asian Village, investors
    seeing our community as a place where they can feel at home and
    where they can prosper.  Young professionals are relocating here
    to participate in our cosmopolitan lifestyle.  The I-85 corridor is
    turning into a destination for consumers who appreciate our
    distinctive mix.  Simply put, our turn-around is fueled by diversity
    that only immigrant communities can generate.
    	Do not mess this up for us.
    	Think of Vancouver, British Columbia, just north of Seattle,
    with a flourishing economy tied into the world market.  Vancouver
    boomed when talented people and investors in Hong Kong
    wondered where they could go after the colony reverted back to
    Chinese Communist rule.  Vancouver welcomed newcomers, made
    them feel at home like neighbors, and everybody got healthcare.  It
    is important to make someone who is thinking of bringing talent
    and money and family into our community feel welcome.  And in
    the real world, the modern world, part of that welcome is
    healthcare.
    	It is important to understand that immigrant communities are
    themselves diverse.  Some are here legally, some are not.  Some
    are in the twilight world because some bureaucrat has not had time
    to process the papers yet.  And this diversity extends into families.
    Poppa has got a green card and does pretty well, momma works
    odd jobs because she does not have her papers, junior was not born
    here, so he may not get to go to college while sis carries a U.S.
    passport, having been born here.  Mixed families are common.
    When politicians and activists gin up sentiments against the
    undocumented, it reverberates through any community,
    documented and undocumented, legal and illegal alike.  Our global
    investors take notice.
    	That was the case earlier this year when our State legislature
    heatedly debated and eventually enacted an anti-immigrant bill
    designed to play on these sentiments to win elections while inciting
    fear in our communities and scaring away business investments.
    As a consequence, hard-working people in my district are afraid to
    get the health services they need.  Many are afraid to take their
    citizen children for care and when they get sick enough, they will
    end up in the hospital emergency room and we all decry the over-
    crowding and cost of this emergency care, as though we had
    nothing to do with creating this.
    	One of the myths distorting the discussion about immigration is
    that the undocumented represent an unsustainable drain upon
    public resources.  But that myth ignores the reality that these hard-
    working people are not only consumers of public services, but also
    contributors.  A recent study by the Center on Budget and Policy
    Priorities, for example, finds that the Senate immigration bill, by
    creating a guest worker program,--that is the U.S. Senate
    immigration bill--expanding the number of family-sponsored and
    employment-based admissions, creating a process for the
    undocumented and illegal immigrants to legalize their status, and
    requiring those seeking to legalize to pay back taxes for earlier
    years would significantly increase the number of legal immigrants
    filing Federal tax returns.  The net effect of welcoming these new
    workers is Federal revenues enhanced by some $12 billion, more
    than offsetting the growth of entitlements.
    	That is the macro economic level.  I am here to tell you about
    the micro.  In my small part of the world, investment and consumer
    spending gravitates to us because of, and not in spite of, our mixed
    and diverse population.  The prosperity that is just around the
    corner for us more than offsets the public sector investments
    required.  It even offsets the consequences of the "white flight" of
    the 1990s.
    	That is what I am asking you not to mess it up.
    	Specifically, it is important to make some adjustments in the
    short term in the area of healthcare, because failure to act may
    have a corrosive effect on my community's social cohesion.  The
    Federal government should let citizens who apply for Medicare to
    declare under penalty of perjury that they are citizens and who are
    making a good faith effort to secure their citizenship or identity
    documents, enroll in Medicaid while they are gathering their
    documents.  This will ensure that pregnant women, children, and
    others who need timely medical care get it.  There is no reason to
    delay preventive healthcare for children or prenatal care for
    women who are making a good faith effort to get their documents
    together.  Moreover, States should have more flexibility in how to
    determine citizenship to help groups like foster care children, those
    affected by disasters and those whose birth certificates have been
    lost and so on.
    	Offering a legal pathway to earn citizenship can help
    immigrant workers get better jobs that offer employee benefits like
    health insurance, so that it can reduce the number of people who
    are uninsured.  We should never criminalize a hospital or clinic
    that treats an illegal alien or undocumented worker without
    reporting the immigrant to law enforcement.
    	Why would failure to address these issues have a corrosive
    effect on my community's social cohesion?  Recall the mixed
    nature of the community, where the web of personal connections
    crisscrosses the lines of documents.  While the Deficit Reduction
    Act's provisions regarding verification of citizenship by Medicaid
    applicants were targeted at immigrants, they raise serious problems
    for U.S. citizens who are eligible for coverage, but will be
    adversely affected by the paperwork requirements, particularly
    children who are citizens but whose parents are undocumented.
    They are unlikely to have passports.  They may not be verified by
    cross-matches with State vital records.  Obtaining a birth certificate
    can create a Catch-22 for families if a government issued photo ID
    is required, inasmuch as young children typically do not have such
    IDs.
    	Throughout our immigrant communities, people will know
    someone or know someone who knows someone for whom the
    process of obtaining and presenting the necessary documentation
    will delay healthcare coverage.  For providers, who are often from
    the immigrant communities too, the financial impact can be very
    serious, by adding to the burden of uncompensated care, the bills
    of seriously ill citizens who are eligible for Medicaid, but whose
    coverage is delayed or denied as a result of the bureaucratic
    requirements.  Delaying coverage while an expectant mother tries
    to meet the documentation requirements delays prenatal care and
    in some cases will deter the mother from obtaining prenatal care
    altogether.
    	For nearly 2 decades, the States and CMS have used
    presumptive eligibility so that mothers and babies could get care
    without delay while eligibility paperwork is completed.  In
    Georgia, this has increased the number of women receiving timely,
    adequate prenatal care and has helped reduce infant deaths.  The
    new law undercuts that approach by denying full Medicaid
    coverage until citizenship is documented, at least how it is done
    here in Georgia.
    	It is penny wise and pound foolish to delay prenatal care for
    American mothers because it will mean a more adverse pregnancy
    outcome, with increased expenditures for neonatal intensive care
    and in some cases, the care of children with lifelong disabilities.
    Furthermore, it is utterly senseless to make a new born citizen with
    undocumented mother whose births are covered by Medicaid apply
    separately for Medicaid as infants when other newborn citizens are
    deemed eligible for a year at birth.  This will only mean that babies
    go without early preventive care and all of them need to be
    healthy.
    	The social cohesion of my diverse community rests upon the
    expectation that people from wholly different backgrounds can
    work hard side by side and build prosperity together.  We have a
    stake in that prosperity.  We live our aspirations, not our fears.  But
    aspiration and harmony give way to fear and antagonism in a
    heartbeat when parents cannot get healthcare for a newborn, and
    then the downward economic spiral returns.
    	We live in a global economy.  Investors can put their funds in
    Norcross, Georgia or Mumbai, India or Durango, Mexico or
    Sydney, Australia.  Here at home, we live in a mobile society
    where consumers can choose where to spend their discretionary
    income.  I want those investments to flow to Georgia and I want
    that purchasing power aimed at Norcross, Chamblee, Doraville,
    Lilburn, and Duluth.  But that will not happen if we do not adopt
    rational policies regarding immigration and healthcare that take
    full account of the benefits actually derived from a diverse and
    indeed global population.
    	[The prepared statement of Curt Thompson follows:]

    PREPARED STATEMENT OF THE HON. CURT THOMPSON, MEMBER,
    GEORGIA STATE SENATE

            I represent Georgia's 5th State Senate District, situated
    alongside the interstate that comes from Gainesville, where you
    will also hold a hearing, into Atlanta.  We have some historic
    areas, such as the picture postcard railroad depot and town square
    of Norcross, but primarily we in the 5th live in suburbs begun
    during the Seventies, when lots of Atlantans left town after de-
    segregation and lots of Northerners left the Rustbelt after de-
    industrialization.  Some of that rootless suburban population then
    moved again in the Nineties, to points further out, taking with them
    some of the commercial infrastructure that had serviced them.
    What opened up was space for new residents, and making a home
    here are African-Americans finding a first home in the suburbs,
    urbanites fleeing inflated home prices in Atlanta's bohemian
    quarter, and immigrants.
            My district and the neighborhoods around it are home to as
    diverse a population as one finds in the Southeastern US.  In our
    schools, students speak some 120 languages when at home.  I
    campaign in English, Spanish, Korean, Hindi, Vietnamese and
    Mandarin.  I've attended Romanian Orthodox Churches, spoken at
    Hindu Temples, danced Cumbia at a Colombian festival, and cut
    the ribbon at the opening of a high end Chinese Shopping Center.
    At dinnertime, I have menu options as rich as a Congressional aide
    living in Adams-Morgan.  I go home this evening to a wife who
    was born in Colombia.  I am here to tell you that diversity works.
            When that first wave of suburbanites left for the exurbs in the
    Nineties, they took along with them some of the commercial
    infrastructure that had serviced them.  We lost jobs.  Storefronts
    stood vacant.  Dollars for development went elsewhere.  With
    declining political clout, our schools got fewer resources.  Traffic
    worsened.  We had a tough decade or so.
            We have turned a corner.  We've done the hard work to get the
    broader community to form a community investment entity called
    the Gwinnett Village Community Improvement District to
    redevelop and market our international community.  We've also
    become a draw to new investment, with new major retail outlets
    catering to our diverse community's demands, and plans for
    several major new-urbanist live-work-shop centers including the
    Super Pearl and Super H centers as well as proposals for mixed use
    developments at Gwinnett Place Mall and at the Jimmy Carter
    Boulevard intersection with Interstate 85.  Large investments are
    coming from overseas including the Asian Village, investors
    seeing our community as a place where they can feel at home and
    where they can prosper.  Young professionals are re-locating here
    to participate in our cosmopolitan lifestyle.  The I-85 corridor is
    turning into a destination for consumers who appreciate our
    distinctive mix.  Simply put, our turn-around is fueled by diversity
    that only immigrant communities can generate.
            Don't mess this up for us.
            Think of Vancouver, British Columbia, just north of Seattle,
    with a flourishing economy tied into the world market.  Vancouver
    boomed when talented people and investors in Hong Kong
    wondered where they could go after the Colony reverted to China.
    Vancouver welcomed newcomers.  Made them feel at home.  Like
    neighbors.  And everybody got healthcare.  It's important to make
    someone who is thinking of bringing talent and money and family
    into our community feel welcome.  And in the real world, in the
    modern world, part of that welcome is healthcare.
            It's important to understand that immigrant communities are
    themselves diverse.  Some are here legally.  Some are not.  Some
    are in a twilight world because some bureaucrat hasn't had time to
    process papers yet.  And this diversity extends into families.
    Poppa's got a green card and does pretty well, Momma works odd
    jobs because she doesn't have her papers, Junior wasn't born here
    so may not get to go to college, while Sis carries a US passport.
    Mixed families are common.  When politicians and activists gin up
    sentiments against the undocumented, it reverberates throughout
    my community, documented and undocumented alike.  Our global
    investors take notice.
            That was the case earlier this year, when our State Legislature
    heatedly debated and eventually enacted an anti immigrant bill
    designed to play on these sentiments to win elections while inciting
    fear in our communities and scaring away business investments.
    As a consequence, hard-working people in my district are afraid to
    get health services they need.  Many are afraid to take their citizen
    children for care.  When they get sick enough, they will end up in
    the hospital emergency room, and we'll all decry the
    overcrowding, and costs of this emergency care, as though we had
    nothing to do with it.
            One of the myths distorting the discussion about immigration is
    that the undocumented represent an unsustainable drain upon
    public resources.  But that myth ignores the reality that these hard-
    working people are not only consumers of public services but also
    contributors.  A recent study by the Center on Budget and Policy
    Priorities, for example, finds that the "Senate immigration bill, by
    creating a guest-worker program, expanding the number of family-
    sponsored and employment-based admissions, creating a process
    for undocumented immigrants to legalize their status, and requiring
    those seeking to legalize to pay back taxes for earlier years would
    significantly increase the number of legal immigrants filing federal
    tax returns."  The net effect of welcoming these new workers is
    federal revenues enhanced by some twelve billion dollars, more
    than offsetting growth of entitlements.  Moreover, offering a legal
    pathway to earned citizenship can help immigrant workers get
    better jobs that offer employee benefits like health insurance.
    Thus, it can reduce the number of people who are uninsured.
            That's the macroeconomic level.  I'm here to tell you about the
    micro.  In my small part of the world, investment and consumer
    spending gravitates to us because of and not in spite of our mixed
    and diverse population.  The prosperity that is just around the
    corner for us more than offsets the public sector investments
    required.  It even offsets the consequences of the "White Flight" of
    the Nineties.
            That's what I'm asking you not to mess up.
            Specifically, it is important to make some adjustments in the
    short term in the area of healthcare, because failure to act may
    have a corrosive effect on my community's social cohesion.  The
    federal government should let citizens who apply for Medicaid,
    who declare under penalty of perjury that they are citizens and who
    are making a good faith effort to secure their citizenship or identity
    documents, enroll in Medicaid while they are gathering their
    documents.  This will ensure that pregnant women, children and
    others who need timely medical care get it.
            There is no reason to delay preventive health care for children
    if their families are making a good faith effort to get their
    documents together.  Likewise, it is penny-wise and pound-foolish
    to delay treatment for a chronic condition while waiting for
    documents.  Furthermore, it is utterly senseless to make newborn
    citizens with undocumented mothers whose births were covered by
    Medicaid apply separately for Medicaid when other newborn
    citizens are deemed eligible at birth for a year of coverage.  This
    will only mean the babies go without the early preventive care all
    of them need to be healthy.  Finally, states should have more
    flexibility in how to determine citizenship to help groups like
    foster care children, those affected by disasters, those whose birth
    certificates have been lost, and so on.
            Why would failure to address these issues have a corrosive
    effect on my community's social cohesion?  Recall the mixed
    nature of that community, where the web of personal connections
    crisscrosses the lines of documentation.  While the Deficit
    Reduction Act's provisions regarding verification of citizenship by
    Medicaid applicants were targeted at immigrants, they raise serious
    problems for U.S. citizens who are eligible for coverage but will be
    adversely affected by the paperwork requirements, particularly
    children who are citizens but whose parents are undocumented.
    They are unlikely to have passports.  They may not be verified by
    cross-matches with state vital records.  Obtaining a birth certificate
    can create a "Catch 22" for families, if a government-issued photo
    ID is required, inasmuch as young children typically do not have
    such IDs.
            Throughout our immigrant communities, people will know
    someone or know someone who knows someone for whom the
    process of obtaining and presenting the necessary documentation
    will delay healthcare coverage.  For providers, who are often from
    the immigrant communities, too, the financial impact can be very
    serious, by adding to the burden of uncompensated care the bills of
    seriously ill citizens who are eligible for Medicaid, but whose
    coverage is delayed or denied as a result of the bureaucratic
    requirements.
            The social cohesion of my diverse community rests upon the
    expectation that people from wholly different backgrounds can
    work hard side by side and build prosperity together.  We all have
    a stake in that prosperity.  We live our aspirations, not our fears.
    But aspiration and harmony give way to fear and antagonism in a
    heartbeat when parents cannot get healthcare for a newborn.  And
    then the downward economic spiral returns.
            We live in a global economy.  Investors can put their funds into
    Norcross, Georgia, or Mumbai, India, or Durango, Mexico, or
    Sydney, Australia.  Here at home, we live in a mobile society
    where consumers can choose where to spend their discretionary
    income.  I want those investments to flow into Georgia.  I want
    that purchasing power aimed at Norcross, Chamblee, Doraville,
    Lilburn, Lawrenceville, and Duluth.  But that won't happen if we
    don't adopt rational policies regarding immigration and healthcare
    that take full account of the benefits actually derived from a
    diverse and indeed a global population.

    	MR. DEAL.  Thank you, Senator.
    	[Applause.]
    	MR. DEAL.  I will ask the audience to cooperate.  I left my
    gavel at home today, but I still have my knuckles to rap.  So please
    cooperate with us.  This is an important hearing and there
    obviously are differences of opinion.
    	I will begin the questioning, followed by my colleagues.  If you
    will set the timer, we will have 5 minutes in which to--you want to
    do 10 minutes?  Okay, 10 minutes.
    	First of all, Senator Thompson, I want to agree with you that
    diversity works.  But diversity in this country has always been
    founded on the rule of law, as you are very well aware.  What at
    least some of us are saying here today, is that diversity, as long as
    it conforms to the law, is a very good thing.  The problem we have
    is the presentation you have made, as I would characterize it, is
    that the facts are sometimes stubborn things, but the law is also
    sometimes a stubborn thing.  So sometimes the easiest thing to do
    is to ignore the law.  Many of the examples that you cited in your
    testimony are examples where we have just ignored the law and
    nobody has done anything about it.
    	So let me just put it in a very simple question to you then.  Do
    you believe that taxpayers should pay for all healthcare that may
    be required, emergency and non-emergency, for anybody who is
    on American soil, regardless of their legal status?
    	MR. THOMPSON.  What I believe is that we have a healthcare
    crisis.  And in my district, it is more about the fact that--
    	[Audience comment.]
    	MR. THOMPSON.  It is more about the fact that most--and my
    district has a high percentage, probably the highest percentage, of
    uninsured I am told of any district in the State.  And that is because
    the jobs in my district do not offer health insurance.  They are in
    construction, they are in service industries.  That is true whether
    they are in hotels, they are in restaurants, they are in places--the
    best corporate citizen I have got is probably Starbucks.  So that is
    true for legal and illegal.  And so there is a problem there with a
    healthcare crisis.
    	What I did say in my testimony is that we need to be
    reasonable in what type of documentation we ask them to require,
    how long we give people to require it, and what presumptions go
    on.  The courthouse in Carnesville burned I think in--it was before
    I was born, but after my mom was born.  My own mom cannot
    obtain an original birth certificate and so by the definitions that are
    being set up, she would have trouble--and she is an American
    citizen as near as I can remember--
    	MR. DEAL.  You all better watch out.
    	[Laughter.]
    	MR. THOMPSON.  She would have trouble under the rules that
    are being set up.  And that is why I have urged folks to adopt
    practical solutions to real world problems like the Senate Bill.
    	MR. DEAL.  Let me say to you that I think you will be pleased
    when you hear the second panel's testimony with regard to that
    issue.  I think you will find that the four States, including Georgia,
    that are now requiring and have required even before the Federal
    requirement went into place, that those problems are virtually non-
    existent.  It is not one of those things that somebody says my birth
    certificate burned up somewhere, go home until you find it.  State
    authorities, and I am sure you will hear from Mr. Ortiz who is head
    of our facility here in the State, that they are cooperative in getting
    those.  I think those are strawman type arguments, quite frankly.  I
    do not think they are realistic.  I think that the facts do not sustain
    that.
    	Let me move to another area of your testimony that I think is
    certainly relevant, because part of the thrust of what we are talking
    about here today is part of what we have already done as we have
    all alluded to in the Deficit Reduction Act of requiring citizenship
    verification as an eligibility requirement for Medicaid.  As all of
    you have indicated, the State of Georgia, even before we did that,
    had already taken that step.
    	But also part of what these hearings are, and there are hearings
    by various other committees across the country, looking and
    comparing and contrasting the Senate-passed version of the
    immigration reform bill and the House-passed version of the
    immigration reform bill.  And you alluded, Senator Thompson,
    appropriately I think, to one of those distinctions.  And that is there
    are really two big distinctions, if we want to simplify it.
    	And that first one is a guest worker program that is included in
    the Senate bill that is not in the House and an amnesty provision
    that is--or at least five different versions of amnesty--that are
    included in the Senate bill that there are none in the House bill.
    	Now one of your statements that caught my attention was the
    quote that I believe you quoted from another source.  I cannot put
    my finger on it right now.
    	MR. THOMPSON.  Center for Budget and Policy.
    	MR. DEAL.  Yes, Center for Budget and Policy Priorities, in
    which they made the quote about the Senate immigration bill with
    a guest worker program expanding the number of family-
    sponsored and employment-based admissions, and it goes on to say
    they think that that is a good idea.
    	I asked this question to the panel that Congressman Norwood
    had in a hearing in Gainesville yesterday, and that is, for people to
    come into this country legally, we have sponsorship programs
    where someone can sponsor an individual to come in.  Part of the
    1996 Immigration Reform Act said that if you are a sponsor of an
    immigrant coming into this country, then you will have the
    responsibility of saying they will not become a charge upon the
    public services of the State or the Federal government.  I asked the
    question if anyone had ever heard of a sponsor being held
    financially accountable for the expenses of an individual that they
    sponsored.
    	Have any of you gentlemen ever heard of that?
    	MR. CAGLE.  No.
    	MR. ROGERS.  No.
    	MR. THOMPSON.  No.
    	MR. DEAL.  You are in agreement with the panel yesterday.
    Nobody had ever heard of that.  And that is what causes me some
    real concern, is if we are going to duplicate the language of an
    ineffective law in this new package that the Senate is proposing, I
    do not know how you would ever expect a hospital, for example, to
    know who the sponsor of an individual is, whether it be a private
    family type sponsorship or an employer-based sponsorship, to hold
    them accountable for expenses, here in this context talking about
    healthcare.
    	Do you have a good idea as to how that might work?
    	MR. THOMPSON.  How you might?
    	MR. DEAL.  How you might hold either an employer or a
    family-based sponsorship accountable for the expenses so that
    these individuals who now are presenting themselves either at the
    ER or the general hospital or doctors' offices, do not become a
    charge upon public resources.
    	MR. THOMPSON.  Well, I guess you are sort of calling for
    speculation and I am a lawyer, so I am probably good at doing that.
    	MR. DEAL.  I am too and I know it when I see it.
    	[Laughter.]
    	MR. THOMPSON.  Nor am I an expert.  I do know that if you are
    legally here, you have certain documentation including a work
    authorization card.  And again, I am not an expert from the
    Homeland Security Department, I am a State legislator from the
    Fifth District.  But it would seem that you could somehow include
    in the documentation, the work authorization, who is responsible
    for what.
    	MR. DEAL.  I think that is a very key element that we have to
    come to grips with some practical approaches to it.  Either of you
    gentlemen have any suggestions?  Because even though I
    personally do not think that the Senate version will ever pass the
    House of Representatives, at some point, the discussion will
    proceed to documentation.  You know, how do you create a
    tamper-proof document, if you have an expanded guest worker
    program, how do you hold those who are the employer or sponsors
    of those individuals--how do you hold them accountable.
    	Did you all get into any of those kind of discussions at the
    State level?  It probably was not necessary for you to do so.
    Senator Rogers?
    	MR. ROGERS.  No, sir, Congressman Deal, we did not.  And I
    think you hit on one of the multitude of problems with the Senate
    bill.  I characterize it as not worth the paper it is printed on.
    Because it sets up a processing nightmare that could never be
    achieved.  If we look at what we attempted to do in the 1986
    amnesty and realize--and I think this is important for those in the
    audience to remember--that amnesty period just ended last year.  It
    took 20 years to process three million.  How long will it take us to
    process the 20 million that are here illegally today?  No one
    knows.  No one in this room may be alive at that point in time.
    	But it highlights again the processing problems that that bill
    contains and I think that the simple fact of the matter is, if you do
    not have the documentation on you, you cannot expect the
    taxpayers to pay for your medical care.  If you want to pay for it
    out of your own pocket, have at it.  But if you are expecting the
    taxpayers to pay for it, you have got to show up with the
    documentation.  I cannot even go rent a video unless I have the
    proper documentation.  So clearly I should not be allowed to ask
    some other taxpayer to pay for my medical care because I am not
    willing to do so myself.
    	MR. DEAL.  Well, and I do think--
    	[Applause.]
    	MR. DEAL.  I do think that those are reasonable expectations
    that we have placed.
    	Part of any law--as you gentlemen know, you can pass laws,
    the important part sometimes is how they are implemented.  And
    that has been the problem at the Federal level for many years,
    dating from 1986 or even in some cases even beyond that.  And the
    failure to implement the laws that either the Federal government or
    the State government passes.
    	So I think it is going to be important for all three of you to have
    the responsibility of oversight at the State level of implementing--
    making sure that the Federal changes we have made and the State
    changes you have made are actually implemented.  As one of you
    alluded to, the Federal legislation delegates to the State the
    responsibility of verifying eligibility for programs like Medicaid.
    So I would ask and hope that you will all--I am sure you will--
    follow up to make sure that what all of us do are actually being
    carried out and implemented in the next year or so.
    	My time has expired and I will now recognize Ms. Solis for 10
    minutes.
    	MS. SOLIS.  Thank you, Mr. Chairman.
    	First, I would like to just clarify that I do not believe anyone
    has proposed any legislation that I know of or that I am supporting
    that would actually repeal the provisions in the Medicaid plan, and
    that is to provide full services to U.S. citizens and to assist those
    that are in need of that service.  I think all Americans, especially
    mothers and children that currently are uninsured, if they have to
    go through a bureaucracy to show proof of citizenship and maybe
    they, for example, just went through a flood like in Mississippi and
    Georgia, Katrina.  What happens to those folks?  Are you going to
    take their word that they are U.S. citizens or not?  How are you
    going to verify that when every documentation is no longer in
    existence?  That is number one.
    	Number two is I tend to agree with the statement that Mr.
    Rogers made regarding the State's role here.  Yes, the States have
    been burdened with a lot of these additional costs in healthcare and
    other services, but I really believe that one of the things that I
    would ask State elected officials to do is to hold their elected
    Federal representatives accountable.  And I agree that over the last
    few years, in fact just this past session, the members on the other
    side of the aisle, agreed to cut back $28 billion in Medicaid for the
    next 10 years.  You tell me how we are going to provide services
    for our elderly, for our disabled, and for those individuals that are
    unable to work that are U.S. citizens?  How are we going to make
    up that revenue?  Where are we going to cut from?
    	The other question I have is, we talk about law enforcement
    and incarceration, detaining of illegal immigrants.  I have gone on
    record, as many Democrats have, to say that we need to beef up
    that particular fund.  That we should not be asking our local
    municipalities, our local law enforcement officers, to have to dig
    into their budget to provide for Federal immigration enforcement.
    That is wrong.  And this Administration and this particular
    Congress that is in control has not fully funded what I think are our
    first responders, the folks out in the field that really have been
    starved.  And in Los Angeles County, we are faced with that
    dilemma right now.  Our sheriff, Lee Baca, there has testified at
    many of these hearings regarding that particular issue.
    	Democrats, by the way, and I want to reiterate, had in the past
    proposed budget funding to fully fund more Border Patrol agents
    to the tune of, what was it I said earlier, at least 6000 more Border
    Patrol agents, to make sure that our borders were secure and that
    we do have adequate enforcement and that we do not burden our
    local law enforcement and local municipalities.  So I agree that the
    Federal government needs to do more and I would ask that our
    elected officials do that.
    	Now I would like to go and ask some questions, please, to
    Senator Thompson.  Senator Thompson, there are some in the
    room, and I believe across the country, that may think that legal
    and illegal immigrants are the source of our problems with respect
    to healthcare and the fact that rising costs continue to climb.
    While the number of uninsured increased--and I want to reiterate
    this--6 million people under this Administration that has been due
    primarily to loss of jobs and lack of job-based coverage.  These are
    important issues that I think the public needs to be aware of, that in
    fact, we have more people that are not insured.  And so you are
    going to have a system that is going to be burdened.  You are
    going to see more people going to the trauma centers to use that
    type of healthcare service if they are not in any form available to
    get into a system that provides adequate coverage.  There has not
    been enough local community clinics, in my opinion, that have
    actually been adequately funded.  In many cases, in my own
    district, many have been closed.  We need to do more for
    prevention so that we do not see these individuals reaching our
    trauma centers where the cost does tend to go up.  But the focus
    there, in my opinion, is really about the uninsured, because many
    uninsured American citizens tend to over-utilize the trauma unit
    centers in our hospital system.  And we have not adequately
    funded those hospitals and reimbursement rates for that type of
    service.
    	If we are asking for an unfunded mandate, I think that is
    wrong.  I think the Federal government should do more to provide
    adequate coverage so people do not come up to our hospitals and
    use that very precious system or unit of service that is so vital.  If
    someone has a head injury or is in a car accident or falls off their
    motorcycle and has a dangerous accident there, the first step is to
    go to the emergency unit of a hospital.  The cost can be enormous
    and yes, in many cases, the States are saddled with that.  And I
    agree that we need to have Federal government play a bigger role
    and to provide coverage for that.  Later today, I am sure we are
    going to hear from the hospitals about that particular burden.
    	But I wanted to ask you, Senator Thompson, if you could give
    us some constructive ideas discussed in Georgia to help lower the
    number of uninsured children.  You talked about your particular
    district having a high number, but that is not an unusual case.  That
    is somewhat typical of many, many cities in our country.  And if
    you could elaborate on that.
    	MR. THOMPSON.  Well, I guess one of things that is a
    possibility here is an expansion of the SCHIP program or
    Peachcare, fully funding it out and maxing that out.  We do not
    take advantage of every Federal dollar, we basically leave dollars
    on the table.  And doing what Illinois has done, expanding
    healthcare to all minors also.  And there is actually a proposal out
    there called Peachkid that would basically do that.  That is going to
    be probably the subject of the election down here in Georgia, but
    that is one issue that is coming up.
    	I do think that in general what you commented about was a
    funding issue, and what we often see, especially at the local level,
    is that the fed does not want to pay for it, so they pass it off on the
    State.  The State does not want to pay for it, so they pass it off on
    the county.  And that results in my county hospital, Gwinnett
    Medical, having a huge deficit, and ultimately the taxpayer pays
    for this emergency room care.  If there were in fact more clinics
    and more money spent on clinics, more money spent on preventive
    care, we would not in fact have this option.
    	I understand the desire to strike out at people you feel may
    have broken the law, but you are doing it in a way that is costing
    you actually more money, the current system is actually going to
    cost us more money and because a county can only raise money
    from property taxes, it is going to cost more money to those who
    can least afford it, people who are more sensitive to property tax
    increases, which are low-income people in their first home or
    elderly people.  While I understand the impulse, it is not sound
    economics, what we are doing.
    	MS. SOLIS.  I wanted to ask you if you could make a
    comparison between the Georgia law that just passed that would
    require documentation for Medicaid and what that would mean for
    you if the Federal government comes in and says well no, you have
    to follow along our lines.  Would there be some dramatic changes
    that would affect costs, medical costs?
    	MR. THOMPSON.  I do not have specific figures, but other than
    it basically passes the buck because it funnels people to the
    emergency rooms, that is my concern.  And so then you are going
    to have--and my own Gwinnett Medical Center is already running
    a huge deficit for that.  I do not have a specific answer for you
    about those costs, no.
    	MS. SOLIS.  One of the questions that I had is that when we
    begin to ask for documentation, especially for individuals, even
    children in foster care, you talked a little bit about that.  Many
    foster care children, for whatever reason, may not have appropriate
    documentation with them, because they were assigned by a court,
    State, to be put in a foster home.  And those documentations are
    not available because the parents, the blood relatives, are not in say
    in a position to want to do that, to cooperate.  What does that mean
    for American children that should be eligible for even foster care
    assistance?
    	MR. THOMPSON.  Well obviously, I mean we were talking
    about a cumbersome system that is not going to work and is not
    worth the paper that it is printed on.  That is what you are basically
    setting things up and you are also setting it up--for instance, most
    kids are in foster care because of some emergency and it is going
    to be harder to process them through, it is going to increase the
    trauma to those kids.  Ultimately, I mean we can be both--on a
    personal level, it is going to increase the trauma to those kids, but
    on a government level, it is going to ultimately increase costs to us
    because it is going to require additional services later on the back
    end to correct the problems created on the front end.
    	MS. SOLIS.  And Senator Thompson, the State's children's
    health insurance program that you talked about, SCHIP, the
    Federal partnership that provides insurance for children and
    families with Medicaid level income, needs to be reauthorized, as
    you know, next year.  Unfortunately, Congress adds new funding
    to the program, we will see a $1.8 million child loss in healthcare
    coverage over the next few years and the States will face a $10-12
    billion shortfall just to maintain that level of funding.  How will
    your State deal with that crisis or that issue that you will be faced
    with?
    	MR. THOMPSON.  Well, I mean unless Congress acts, Georgia
    is going to run out of money, it is just that simple.  And Peachkids
    is probably--or Peachcare, sorry--has probably been, after the Hope
    Scholarship, the most popular program we have enacted in my
    lifetime, or at least in my voting lifetime.  If that runs out of
    money, it is going to throw thousands of kids off healthcare and it
    is going to then result in more kids being in the emergency room,
    higher absentee rates in schools when kids have to stay home, it is
    going to result in lower test scores.  I mean it is going to have a
    ripple effect that will be huge.  Congress does in fact need to
    reauthorize this, absolutely.
    	MS. SOLIS.  Thank you.
    	MR. DEAL.  The gentlelady's time has expired.  Thank you.
    	Mr. Norwood is recognized for 10 minutes for questions.
    	MR. NORWOOD.  Thank you very much, Mr. Chairman.  It
    appears that it falls to me to sort of work on the record just a little
    bit so that we end up here getting some truths out.
    	I want to start by pointing out that the Congress I think did a
    very good job in limiting the growth in Medicaid referred to earlier
    as deep cuts, when in fact really it was simply slowing down the
    spending.  But how we did it did not come out either.  The way we
    did it was to make sure that millionaires could not get rid of their
    assets so they could be on long-term care.  So that is the other part
    of the sentence that I am sure Ms. Solis would have gotten to the
    next round.
    	[Laughter.]
    	MR. NORWOOD.  I want to begin sort of with my discussion
    saying that Senator Rogers, I think the United States Senate
    immigration bill is worse than you described.  I think it is the worst
    piece of legislation that I have seen in Washington, D.C.  in 12
    years.  Should that become law--and it is not--
    	[Applause.]
    	MR. NORWOOD.  --it makes citizens out of the 20 million
    illegal immigrants that are here, immediately invites them to bring
    their families into this country and make citizens.  We estimate that
    that will bring another 20 million new people to America over the
    next 20 years, and by the turn of the century, that will be another
    100 million people have come into this country.
    	Now the reason I point that out is that the purpose of this
    hearing is to talk about the fact that illegal immigrants are getting
    on our social systems and it is busting the bank now.  Senator
    Cagle, what do you think would happen in Georgia over the next
    century if that many more new people came into the country
    legally, were made citizens, and immediately could get onto our
    social programs?  Can Georgia stand that kind of thing?
    	MR. CAGLE.  Well, no, it certainly cannot.  And when you look
    at Georgia today, I will tell you at the outset that there is--we
    believe in immigration and we believe that there is a right way and
    a wrong way to come to this country.  And we cannot condone
    individuals that are coming here through illegal means.
    	When you look at Georgia today, you find that half of all births
    are being paid for by taxpayers of Georgia.  We experienced a
    significant, $400 million, shortfall in Medicaid year after year until
    we made some real changes.  When you look at really having an
    impact, it is only through eligibility and utilization to bring those
    costs into bear.  We cannot continue to absorb these types of costs
    in Georgia.  And Congress has got to act and it has got to act
    swiftly in order to preserve the future for our children.
    	MR. NORWOOD.  Do you believe the first act should be to
    secure our border?
    	MR. CAGLE.  There is no question.
    	MR. NORWOOD.  Senator Rogers?
    	MR. ROGERS.  That is your required duty and we all are
    anxiously awaiting that duty to be fulfilled.
    	MR. NORWOOD.  Senator Thompson?
    	MR. THOMPSON.  I believe you have to do both at the same
    time.
    	MR. NORWOOD.  But you believe we need to secure our
    borders?
    	MR. THOMPSON.  Absolutely.
    	MR. NORWOOD.  And stop people from coming across our
    borders illegally.
    	MR. THOMPSON.  Absolutely.
    	MR. NORWOOD.  I am very happy to hear that.
    	By the way, in terms of correcting the record, you were talking
    about the SCHIP program.  Georgia is a deficit State in SCHIP.
    We spend more in SCHIP monies than does the Federal
    government send us and allow us.  Would you verify that, either
    one of you Senators?
    	MR. ROGERS.  That is true.
    	MR. NORWOOD.  And what you said was the opposite, and I am
    sure you did not mean to, but being a lawyer, you know--
    	[Laughter.]
    	MR. NORWOOD.  No offense, Mr. Chairman.
    	[Laughter.]
    	MR. NORWOOD.  You made a comment, Mr. Thompson, and I
    quote, "you feel may have broken the law."  I presume you were
    talking to us or perhaps somebody on the panel, and you were
    saying that we feel they may be breaking the law by coming into
    our country, using bogus Social Security cards, et cetera, et cetera.
    Do you feel people who have come across our border from Saudi
    Arabia and India and Mexico, are they breaking our law, rather
    than "may be breaking"?  Are they breaking our law?
    	MR. THOMPSON.  I apologize, I do not know where I said "we
    feel" or "we may feel."
    	MR. NORWOOD.  You said "you feel," you were talking to us--
    "you feel they may be breaking our law."  Are they or are they
    not?
    	MR. THOMPSON.  If they are using false documentation, that is-
    -
    	MR. NORWOOD.  Are they breaking our law by crossing our
    border illegally?  Is that against the law?
    	Mr. Thompson.  Yes, condemnation Okay, I just wanted to
    make sure.  So it is not "may be breaking the law," they are
    breaking the law.
    	MR. THOMPSON.  Well, that depends.  Some people do have
    legal documentation to come here.  They may do other things when
    they get here--
    	MR. NORWOOD.  I am not talking about legal documentation, I
    am talking about people who slip across our border in the middle
    of the night.  Turn on Fox News if you want to watch it.  They are
    breaking the law.
    	[Laughter.]
    	MR. THOMPSON.  And I appreciate your question, but I--
    	MR. NORWOOD.  No offense, you have said they are breaking
    the law, it is not "may."
    	MR. THOMPSON.  I have said that--
    	MR. NORWOOD.  Yes or no.
    	[Laughter.]
    	MR. THOMPSON.  Congressman, if you will allow me to answer
    the question or we can--
    	MR. NORWOOD.  Yes or no would be great so I can go to some
    other questions.  Do you believe people who cross our border
    without documents are breaking our laws?
    	MR. THOMPSON.  That is against the law and that is not what I
    said.  I said but having a false Social Security card does not
    necessarily mean they crossed the border illegally.
    	MR. NORWOOD.  I did not say anything about that.
    	MR. THOMPSON.  Well, that is what you are trying to insinuate.
    	MR. NORWOOD.  I said that is another way they break the law.
    	MR. THOMPSON.  I do also want that corrected for the record,
    Mr. Congressman.
    	MR. NORWOOD.  All right, now Senator Rogers.
    	MR. ROGERS.  Yes, sir, glad to answer a question.
    	MR. NORWOOD.  We spend way too much money in
    Washington, very unwisely in my opinion.  The difference is we
    get to print it.  The problem is you do not get to print it over there
    in Atlanta, you have got to actually balance your budget.  I want
    you to take just a minute again and talk about the budgetary
    limitations that we have in our State regarding all programs, but
    particularly we are talking about social programs here, and why is
    it so important that we deal with this problem of making sure we
    spend our dollars for American citizens who deserve the taxpayers'
    dollars frankly, versus people who I think are criminals, who have
    come across our border, broken our laws using false documents, et
    cetera, et cetera.  Would you do that budgetary thing just a minute
    for me?
    	MR. ROGERS.  I will, sir, and I think what is clear, and
    sometimes I think in this great debate we lose focus of very simple
    facts.  Congress is supposed to protect Americans, not people from
    other countries.  Americans.
    	[Applause.]
    	MR. ROGERS.  In Georgia, we are supposed to protect
    Georgians, not Alabamians, nor Floridians.  So when I know there
    are 12,700 severely disabled children, elderly, frail people on a
    waiting list who already qualify for benefits and are being denied
    because we know that certain amounts of dollars go to people who
    are not eligible, then we have simply taken money from those who
    qualify, who are legal U.S. citizens and Georgia residents, and
    given it to people who are here illegally.  That is not just a slap in
    the face to all of us, that is a direct slap in the face to the people
    who already legally qualify.
    	I want to follow up on something Congresswoman Solis said.
    She said she knows of no bill that seeks to repeal Medicaid
    provision.  Well, of course not, if you make everybody legal, you
    do not need to repeal it, they will all get the benefit.
    	[Laughter.]
    	MR. ROGERS.  The second thing--
    	[Applause.]
    	MR. ROGERS.  --I know Congressman Deal and Congressman
    Norwood were here in 1996, I do not know if Congresswoman
    Solis was, but in 1996, I want to correct something.  Title 8,
    Chapter 14, Sections 1611 and 1621, already declare exemptions
    for flood, as you brought up as an example.  You do not have to
    have any documentation if you are injured in a flood or tornado or
    hurricane or anything, and for emergency foster care.  So those
    exemptions are already built into the law.
    	Congressman Deal pointed out strawman arguments.  I think
    oftentimes we get involved in these strawman arguments that are
    simply not part of what the law is.  The law is very clear.  If you
    have an emergency situation, whether it is a flood or foster care,
    you do not have to provide any documentation.
    	We are talking about people who are taking advantage of the
    system, who in many cases could pay for it out of their own
    pocket, but do not want to because they have the Government to
    pick up the tab for them.
    	MR. NORWOOD.  I have got just a minute and, Senator
    Thompson, I need to ask you four or five questions.  Please oblige
    me with yes or no and then I will maybe have time to get it all in.
    	How many people in your district?
    	MR. THOMPSON.  One hundred fifty five thousand.
    	MR. NORWOOD.  Yeah, 650,000 in mine and 8 million in
    Georgia.  So I appreciate you trying to protect your district, but the
    rest of us also have to worry about the rest of the citizens and their
    attitude about this over the rest of the State.
    	Yes or no, please.  Do you think enforcing our laws against
    civil violators is wrong?
    	MR. THOMPSON.  No.
    	MR. NORWOOD.  Do you believe that we should provide
    services to those who are illegally in the Nation even if it means
    there is less service for American citizens?
    	MR. THOMPSON.  I think we need some comprehensive reform
    so that that does not happen, because that is--
    	MR. NORWOOD.  And the answer is yes or no?
    	MR. THOMPSON.  That is a strawman choice and I am not going
    to play that game.
    	MR. NORWOOD.  Well, you can refuse to answer.  I just want to
    know if you--
    	MR. THOMPSON.  I have given you my answer, Mr. Norwood.
    	MR. NORWOOD.  All right, so the answer is you do not.
    	You say that the people in your district--
    	MR. THOMPSON.  I disagree.
    	MR. NORWOOD.  --are afraid to get health services because of
    actions of the legislature.  Now I think that we are going to hear
    from hospital representatives later who are going to testify there is
    no shortage of folks seeking uncompensated care.  Do you
    disagree?
    	MR. THOMPSON.  My hospital runs a deficit, but it does not
    change the fact that there are people not going to the hospital who
    need--and not going to the doctor because of this.  Again, you are
    setting up a false choice.
    	MR. NORWOOD.  Well, I know these questions are hard.
    	Lastly, many are afraid to take their citizen children for care.
    You say that in your document.  Many are afraid to take their
    citizen children for care.  Would you be good enough to furnish
    proof to this Committee that that is true?
    	MR. THOMPSON.  If you would like, I can submit an affidavit.
    	MR. NORWOOD.  I do want you to do that because every ER
    doctor I have ever talked to in this State say they do not have any
    problems with the number of people coming in illegally using their
    emergency room.  So proof would be greatly appreciated.
    	Sorry, Mr. Chairman, for going over.
    	MS. SOLIS.  Mr. Chairman, before you excuse the panel, I
    would like to insert part of the Deficit Reduction Act of 2005 that
    was passed, the section, statute 120, Section 6036 "Improved
    Enforcement of Documentation Requirements," which states
    nothing specifically about floods or foster children.  I would like
    that--ask unanimous consent to have that entered into the record.
    	MR. ROGERS.  It is a different title, it's Title VIII, Chapter 14.
    	MR. DEAL.  You may do so, but Senator Rogers was referring
    to the 1996 Act, as I recall.
    	Yes, without objection, that may be included in the record.
    	[The information follows:]

    SEC. 6036. IMPROVED ENFORCEMENT OF
    DOCUMENTATION REQUIREMENTS.
            (a) In General- Section 1903 of the Social Security Act (42
    U.S.C. 1396b) is amended--
            (1) in subsection (i), as amended by section 104 of Public
    Law 109-91--
            (A) by striking `or' at the end of paragraph (20);
            (B) by striking the period at the end of paragraph (21)
    and inserting `; or'; and
            (C) by inserting after paragraph (21) the following new
    paragraph:
            (22) with respect to amounts expended for medical
    assistance for an individual who declares under section
    1137(d)(1)(A) to be a citizen or national of the United
    States for purposes of establishing eligibility for benefits
    under this title, unless the requirement of subsection (x) is
    met.'; and
            (2) by adding at the end the following new subsection:

            (x)(1) For purposes of subsection (i)(23), the requirement of
    this subsection is, with respect to an individual declaring to be a
    citizen or national of the United States, that, subject to paragraph
    (2), there is presented satisfactory documentary evidence of
    citizenship or nationality (as defined in paragraph (3)) of the
    individual.
            (2) The requirement of paragraph (1) shall not apply to an alien
    who is eligible for medical assistance under this title--
            (A) and is entitled to or enrolled for benefits under any part
    of title XVIII;
            (B) on the basis of receiving supplemental security income
    benefits under title XVI; or
            (C) on such other basis as the Secretary may specify under
    which satisfactory documentary evidence of citizenship or
    nationality had been previously presented.
            (3)(A) For purposes of this subsection, the term `satisfactory
    documentary evidence of citizenship or nationality' means--
            (i) any document described in subparagraph (B); or
            (ii) a document described in subparagraph (C) and a
    document described in subparagraph (D).
            (B) The following are documents described in this
    subparagraph:
            (i) A United States passport.
            (ii) Form N-550 or N-570 (Certificate of Naturalization).
            (iii) Form N-560 or N-561 (Certificate of United States
    Citizenship).
            (iv) A valid State-issued driver's license or other identity
    document described in section 274A(b)(1)(D) of the
    Immigration and Nationality Act, but only if the State
    issuing the license or such document requires proof of
    United States citizenship before issuance of such license or
    document or obtains a social security number from the
    applicant and verifies before certification that such number
    is valid and assigned to the applicant who is a citizen.
            (v) Such other document as the Secretary may specify, by
    regulation, that provides proof of United States citizenship
    or nationality and that provides a reliable means of
    documentation of personal identity.
            (C) The following are documents described in this
    subparagraph:
            (i) A certificate of birth in the United States.
            (ii) Form FS-545 or Form DS-1350 (Certification of Birth
    Abroad).
            (iii) Form I-97 (United States Citizen Identification Card).
            (iv) Form FS-240 (Report of Birth Abroad of a Citizen of
    the United States).
            (v) Such other document (not described in subparagraph
            (B)(iv)) as the Secretary may specify that provides proof of
    United States citizenship or nationality.
            (D) The following are documents described in this
    subparagraph:
            (i) Any identity document described in section
    274A(b)(1)(D) of the Immigration and Nationality Act.
            (ii) Any other documentation of personal identity of such
    other type as the Secretary finds, by regulation, provides a
    reliable means of identification.
            (E) A reference in this paragraph to a form includes a
    reference to any successor form.

            (b) Effective Date- The amendments made by subsection (a)
    shall apply to determinations of initial eligibility for medical
    assistance made on or after July 1, 2006, and to redeterminations
    of eligibility made on or after such date in the case of individuals
    for whom the requirement of section 1903(z) of the Social Security
    Act, as added by such amendments, was not previously met.
            (c) IMPLEMENTATION REQUIREMENT- As soon as
    practicable after the date of enactment of this Act, the Secretary of
    Health and Human Services shall establish an outreach program
    that is designed to educate individuals who are likely to be affected
    by the requirements of subsections (i)(23) and (x) of section 1903
    of the Social Security Act (as added by subsection (a)) about such
    requirements and how they may be satisfied.

    	MR. DEAL.  And without objection, Senator Thompson, you
    may be allowed to submit further evidence to substantiate the
    statements that have been referred to.
    	Gentlemen, thank you very much for your service and thank
    you for being with us today.
    	[Applause.]
    	MR. DEAL.  If the second panel will please take their seats.  I
    am pleased to introduce our second panel and we do need to move
    along as expeditiously as possible since we have three panels here
    today.  I am pleased to introduce the second panel of Ms. Jean
    Sheil, who is the Director of Family and Children's Health
    Program, Center for Medicaid and State Operations, Centers for
    Medicare & Medicaid Services in Washington, D.C.; Dr. Alison
    Siskin, who is a specialist in immigration legislation, Domestic
    Social Policy Division of the Congressional Research Service; and
    Mr. Abel C. Ortiz, who is Health and Human Services Policy
    Advisor, office of Governor Sonny Perdue of the State of Georgia.
    	Ladies and gentlemen, we are pleased to have you here and
    Ms. Sheil, we will begin with your testimony.  You have 5
    minutes.

    STATEMENTS OF JEAN SHEIL, DIRECTOR, FAMILY AND CHILDREN'S HEALTH PROGRAM,
    CENTER FOR MEDICAID AND STATE OPERATIONS, CENTERS FOR MEDICARE & MEDICAID
    SERVICES; DR. ALISON SISKIN, SPECIALIST IN IMMIGRATION LEGISLATION, DOMESTIC
    SOCIAL POLICY DIVISION, CONGRESSIONAL RESEARCH SERVICE; AND ABEL C.  ORTIZ,
    HEALTH AND HUMAN SERVICES POLICY ADVISOR, OFFICE OF THE GOVERNOR, STATE OF
    GEORGIA

    	MS. SHEIL.  Thank you, Mr. Chairman, Chairman Deal, Dr.
    Norwood, and Ms. Solis, thank you for inviting me to speak with
    you today about Section 6036 of the Deficit Reduction Act entitled
    "Improved Enforcement of Documentation Requirements."
    	Medicaid is a partnership between the Federal government and
    the States.
    	MR. DEAL.  Could you speak into the mic?
    	MS. SHEIL.  Yes, sir.  Is that better?
    	MR. DEAL.  Yes.
    	MS. SHEIL.  Okay.  Medicaid is a partnership between the
    Federal government and the States.  While the Federal government
    provides financial matching payments to the States, each State is
    responsible for overseeing its Medicaid program and each State
    pays a portion of its cost through a statutorily determined matching
    rate, currently ranging between 50 and approximately 76 percent.
    The Centers for Medicare & Medicaid Services, CMS, which
    oversees the Federal responsibility for Medicaid, ensures States
    enforce Medicaid eligibility requirements.  Recently, CMS issued
    guidance and an interim final regulation to the States as part of the
    implementation of the Deficit Reduction Act which requires
    Medicaid applicants who declare they are citizens to document
    their citizenship and identity.
    	The Personal Responsibility and Work Opportunity
    Reconciliation Act of 1996, also known as PRWORA,
    significantly changed the eligibility of non-citizens for Federal
    means-tested public benefits, including Medicaid and subsequently
    the State Children's Health Insurance Program, SCHIP.  This
    change, however, did not alter eligibility for undocumented and
    non-immigrant aliens, who generally remain ineligible for non-
    emergency Federal benefits.
    	Under PRWORA, States are required to provide Medicaid to
    certain qualified aliens who otherwise meet the eligibility criteria
    of the State's Medicaid program, unless subject to a 5-year bar.
    The 5-year bar applies only to qualified aliens who entered the
    United States on or after August 22, 1996, with some exceptions.
    	However, the 5-year bar and other eligibility restrictions do not
    apply to aliens who are applying only for treatment of an
    emergency medical condition.  Thus, all aliens, both qualified and
    non-qualified, including undocumented immigrants, may be
    eligible for treatment of an emergency medical condition, provided
    they otherwise meet the eligibility criteria, such as income level,
    for example, for the State's Medicaid program.
    	American citizenship or legal immigration status have, for
    many years, been a requirement for Medicaid eligibility.  However,
    as Dr. Norwood indicated, previously in many States, applicants
    could assert their citizenship status by merely checking a box on a
    form.  The Deficit Reduction Act now holds States financially
    responsible for Medicaid expenditures for individuals claiming to
    be U.S. citizens unless such individuals provide actual
    documentary evidence supporting their citizenship and identity.
    This new requirement applies to new applications for Medicaid
    eligibility and redeterminations effective July 1.
    	In order to give States some initial guidance on the
    implementation of this provision, on June 9, CMS issued a State
    Medicaid Director Letter.  On July 12, the Department published
    an interim final regulation for States to implement this new
    requirement.  Comments on the interim final rule were due last
    Friday, August 11.
    	The law requires that a person provide evidence of both
    citizenship and identity.  In some cases, a single document will be
    enough to establish both citizenship and identity.  However, if
    secondary documentation is used to establish citizenship, such as a
    birth certificate, the individual will also need evidence of his or her
    identity.  Once citizenship has been proven, it need not be
    documented again with each eligibility renewal unless later
    evidence raises a question.
    	The interim regulation provides a broad array of documents
    that are acceptable evidence of citizenship and identity.
    Individuals who receive Medicare and individuals who are on
    Supplemental Security Income are exempt from these
    documentation requirements.
    	At the time of application or redetermination, the State must
    give an applicant reasonable opportunity to present documents
    establishing U.S. citizenship or nationality and identity.  An
    individual who is already enrolled in Medicaid will remain eligible
    if he or she puts forth a good-faith effort to present satisfactory
    evidence of citizenship and identity.  Applicants who, despite their
    good-faith effort, are unable to present documentation should be
    assisted by the State in securing these documents.  CMS
    encourages States to use automated capabilities to verify
    citizenship and identity of Medicaid applicants.  We specifically
    asked for public comment in the regulation on whether there are
    other electronic data systems that should be identified to assist
    States in determining an individual's citizenship or identity.
    	As with other Medicaid program requirements, States must
    implement an effective process for assuring compliance with
    documentation of citizenship in order to obtain Federal matching
    funds, and effective compliance will be part of Medicaid program
    integrity monitoring.  When future automated capabilities to verify
    citizenship and identity of Medicaid applicants become available,
    States will also be required to match for individuals who used less
    reliable documents to verify citizenship and identity.  States will
    receive the normal 50 percent match for administrative expenses
    related to implementation of the new law.
    	The law also requires that the Secretary develop, as soon as
    practicable, an outreach program which is intended to educate
    individuals who are likely to be affected by the requirements of
    this provision of the law.  CMS has already conducted numerous
    teleconferences with States and other organizations interested in
    this provision.  Fact sheets, posters, brochures are also available on
    our CMS website.  In addition, we are developing an outreach plan
    that provides strategic direction and coordination for an integrated
    education and outreach program to inform States, Medicaid
    recipients, and others of these new documentation requirements.
    The plan will ensure that all stakeholders know of the new
    requirements, understand the documents which satisfy these
    requirements and assist the streamlined implementation by States,
    and ensure continued uninterrupted access to Medicaid for citizens.
    	Thank you again for this opportunity to speak with you on
    these new Medicaid program requirements.
    	MR. DEAL.  Thank you.  Dr. Siskin.
    	[The prepared statement of Ms. Sheil follows:]

    PREPARED STATEMENT OF JENA SHEIL, DIRECTOR, FAMILY AND
    CHILDREN'S HEALTH PROGRAM, CENTER FOR MEDICAID AND
    STATE OPERATIONS, CENTERS FOR MEDICARE & MEDICAID
    SERVICES

            Thank you for inviting me to speak with you about the impact
    of undocumented immigrants on the Medicaid program and the
    health care delivery system and express the Administration's
    support for comprehensive immigration reform that increases
    border security, establishes a robust interior enforcement program,
    creates a temporary worker program, and addresses the problem of
    the estimated 11 to 12 million illegal immigrants already in the
    country.
            Medicaid is a partnership between the Federal government and
    the states.  While the Federal government provides financial
    matching payments to the states, each state is responsible for
    overseeing its Medicaid program, and each state pays a portion of
    its cost through a statutorily determined matching rate, currently
    ranging between 50 and approximately 76 percent.  The Centers
    for Medicare & Medicaid Services (CMS), which oversees the
    Federal responsibility for Medicaid, ensures states enforce
    Medicaid eligibility requirements.  Recently, CMS issued guidance
    and an interim final regulation to the states as part of the
    implementation of the Deficit Reduction Act of 2005 (DRA),
    which requires Medicaid applicants who declare they are citizens
    to document their citizenship and identity.
            CMS, in regards to the broader health care system, also
    enforces regulations that require hospitals to medically screen and
    provide stabilizing treatment or an appropriate transfer to any
    person seeking emergency care, regardless of payment method or
    citizenship status.

    Immigrants and Medicaid Eligibility
            The Personal Responsibility and Work Opportunity
    Reconciliation Act of 1996 (PRWORA) significantly changed the
    eligibility of non-citizens for Federal means-tested public benefits,
    including Medicaid and subsequently the State Children's Health
    Insurance Program (SCHIP).  This change, however, did not alter
    eligibility for undocumented and nonimmigrant aliens, who
    generally remain ineligible for non-emergency Federal benefits.
    As a general rule, only "qualified aliens" may be eligible for
    Medicaid and SCHIP coverage.  Qualified aliens include aliens
    lawfully admitted for permanent residence under the Immigration
    and Nationality Act.  Refugees, those granted asylum, and victims
    of a severe form of trafficking (as certified by the Office of
    Refugee Resettlement of the Department of Health and Human
    Services) among several other categories also may be considered
    qualified aliens.
      	Under PRWORA, states are required to provide Medicaid to
    certain qualified aliens who otherwise meet the eligibility criteria
    of the state's Medicaid program, unless subject to a five-year bar.
    This five-year bar applies only to qualified aliens who entered the
    United States on or after August 22, 1996 with some exceptions.
    Typically the bar applies to lawful permanent residents and aliens
    granted parole for at least one year.  Some qualified aliens are
    exempt from the five-year bar, including refugees, those granted
    asylum, and trafficking victims, among others.  A qualified alien
    who is honorably discharged from the military; on active duty in
    the U.S. military; or the spouse (including a surviving spouse who
    has not remarried) or unmarried dependent child of an honorably
    discharged veteran or individual on active duty in the U.S. military
    also is exempt from the five-year bar.
            However, the five-year bar and other eligibility restrictions do
    not apply to aliens who are applying only for treatment of an
    emergency medical condition.  Thus, all aliens - both qualified and
    non-qualified aliens (including undocumented immigrants) - may
    be eligible for treatment of an emergency medical condition,
    provided they otherwise meet the eligibility criteria (such as
    income level, for example) for the state's Medicaid program.

    CMS Issues Guidance on Citizenship and Identity Documentation for Medicaid
    Eligibility
            American citizenship or legal immigration status have, for
    many years, been a requirement for Medicaid eligibility.  However,
    previously, in many states applicants could assert their citizenship
    status by merely checking a box on a form.  (A number of states
    have long required their applicants to document citizenship,
    including New York, New Hampshire and Montana.)  The DRA
    now holds states financially responsible for Medicaid expenditures
    for individuals claiming to be United States citizens unless such
    individuals provide actual documentary evidence supporting their
    citizenship and identity.  This new requirement applies to new
    applications for Medicaid eligibility and re-determinations
    beginning July 1, 2006.
            In order to give states some initial guidance on the
    implementation of this provision, on June 9, 2006 CMS issued a
    State Medicaid Director letter.  On July 12, 2006 the Department
    published an interim final regulation for states to implement this
    new requirement.  Comments on the interim final rule are due on
    August 11, 2006.  We expect to publish a final rule shortly.
            The law requires that a person provide evidence of both
    citizenship and identity.  In some cases, a single document will be
    enough to establish both citizenship and identity, such as a U.S.
    passport.   However, if secondary documentation is used to
    establish citizenship, such as a birth certificate, the individual will
    also need evidence of his or her identity.  Once citizenship has
    been proven, it need not be documented again with each eligibility
    renewal unless later evidence raises a question.
            The law specifies certain forms of acceptable evidence of
    citizenship and identity and provides for the use of additional
    forms of documentation as established by Federal regulations,
    when appropriate.  If an applicant or recipient presents evidence
    from the listing of primary documentation, such as a U.S. passport,
    certificate of naturalization, or a certificate of U.S. citizenship, no
    other information is required.  When such evidence cannot be
    obtained, our regulations require the states to look to the next tier
    of acceptable forms of evidence.   However, a state must first seek
    documents from the primary list before looking to the secondary or
    tertiary lists.  Because individuals who receive Medicare and
    individuals who are on Supplemental Security Income (SSI) in a
    state using SSI for Medicaid eligibility purposes already have met
    certain documentation requirements, the regulation does not
    include new documentation requirements for these groups.  This
    exemption reflects the special treatment of these groups in the
    statute.
            At the time of application or re-determination, the state must
    give an applicant or recipient a "reasonable opportunity" to present
    documents establishing U.S. citizenship or nationality and identity.
    An individual who is already enrolled in Medicaid will remain
    eligible if he/she puts forth a good faith effort to present
    satisfactory evidence of citizenship and identity.  Applicants who
    despite their good faith effort are unable to present documentation
    should be assisted by the state in securing these documents.  States
    may use data matches with the State Data Exchange (SDX) or vital
    statistics agencies in place of a birth certificate to assist applicants
    or recipients to meet the requirements of the law.  As a check
    against fraud, states are also required to use currently available
    capabilities to conduct a match of the applicant's name against the
    corresponding Social Security number that was provided.  In
    addition the Federal government encourages states to use
    automated capabilities to verify citizenship and identity of
    Medicaid applicants.  We specifically asked for public comment on
    whether there are other electronic data systems that should be
    identified to assist states in determining an individual's citizenship
    or identity.
            As with other Medicaid program requirements, states must
    implement an effective process for assuring compliance with
    documentation of citizenship in order to obtain federal matching
    funds, and effective compliance will be part of Medicaid program
    integrity monitoring.  In particular, audit processes will track the
    extent to which states rely on lower categories of documentation
    with the expectation that such categories would be used relatively
    infrequently and less often over time, as State processes and
    beneficiary documentation improve.  When future automated
    capabilities to verify citizenship and identity of Medicaid
    applicants becomes available, states also will be required to match
    for individuals who used third or fourth tier documents to verify
    citizenship and identity.  In the meantime, states must ensure that
    all case records within this category are identified so that they may
    be made available to conduct these automated matches.  States will
    receive the normal 50 percent match for administrative expenses
    related to implementation of the new law.
            The law also requires that the Secretary develop an outreach
    program which is intended to educate individuals who are likely to
    be affected by the requirements of this provision of the law.  CMS
    has already conducted numerous teleconferences with states and
    other organizations interested in this provision.  In addition, we are
    developing an outreach plan that provides strategic direction and
    coordination for an integrated education and outreach program to
    inform states, Medicaid recipients, and others of these new
    documentation requirements.  This initiative will be implemented
    to promote active and informed involvement by states and people
    with Medicaid in providing beneficiaries the necessary information
    about the new documentation requirements.  The plan will ensure
    that all stakeholders know of the new requirements, understand the
    documents which satisfy these requirements, assist the streamlined
    implementation by states, and ensure continued uninterrupted
    access to Medicaid for citizens.

    EMTALA
            Regarding the broader health care system, CMS enforces the
    1986 Emergency Medical Treatment and Labor Act (EMTALA).
    Under EMTALA, hospitals have obligations to any individual,
    regardless of citizenship, who requests treatment for a medical
    condition.  EMTALA was designed to ensure that people will
    receive appropriate screening and emergency treatment regardless
    of their ability to pay.
            CMS' regulations implementing EMTALA require that
    hospitals with dedicated emergency departments provide an
    appropriate medical screening examination to any person who
    comes to the hospital emergency department and requests
    treatment or examination of a medical condition.  They also
    require that these hospitals provide an appropriate medical
    screening examination to any person who presents himself on
    hospital property requesting evaluation or treatment of an
    emergency medical condition.  In both cases, a request may be
    made by another individual on behalf of the person for whom
    examination or treatment is sought, or a request can be considered
    to have been made if a prudent layperson believes that based on the
    behavior of the individual an emergency medical condition exists.
    If the examination reveals an emergency medical condition, the
    hospital must also provide either necessary stabilizing treatment or
    arrange for an appropriate transfer to another medical facility.
            EMTALA applies to all Medicare-participating hospitals with
    dedicated emergency departments and applies to all individuals
    regardless of immigration status who present themselves
    requesting examination or treatment of a medical condition.
    Hospitals with specialized capabilities have a responsibility under
    EMTALA to accept appropriate transfers regardless of whether the
    hospital has a dedicated emergency department.  A hospital that
    violates EMTALA may have its ability to participate in Medicare
    terminated and may be subject to civil penalties of up to $50,000
    per violation.  An individual who has suffered personal harm and
    any hospital to which a patient has been improperly transferred and
    that has suffered a financial loss as a result of the transfer are also
    provided a private right of action against a hospital that violates
    EMTALA.
            Hospitals also are required to maintain lists of physicians who
    are on call for duty after the initial examination to provide
    necessary stabilizing treatment.  Hospitals have discretion to
    develop their on-call lists in a way that best meets the needs of
    their patients requiring services required under EMTALA.
            Under CMS' regulations, EMTALA does not apply after an
    individual has been admitted for inpatient hospital services, as long
    as the admission is made in good faith and not in an attempt to
    avoid the EMTALA requirements.
            Section 945 of the MMA required the Secretary of Health and
    Human Services to establish a technical advisory group (TAG) to
    review EMTALA policy, including the regulations and interpretive
    guidance outlining hospitals' responsibilities under EMTALA.
    This TAG, which includes hospital, physician and patient
    representatives, has already met 4 times.  The TAG will complete
    its deliberations and submit a report of its findings and
    recommendations to the Secretary by October 2008.

    Conclusion
            Thank you again for this opportunity to discuss the impact of
    undocumented immigrants on Medicaid and the health care
    system.  I would also like to take this opportunity to once again
    express the Administration's support for comprehensive
    immigration reform.  I would be happy to answer any questions
    you might have.

    	MS. SISKIN.  Thank you.  Thank you, Chairman Deal,
    Congresswoman Solis, and Congressman Norwood for the
    invitation to appear before you today.  I am Alison Siskin, a
    specialist in immigration legislation at the Congressional Research
    Service.
    	As discussed previously, currently, non-citizen eligibility for
    Federal Medicaid benefits largely depend on their immigration
    status and whether they arrived or were on the program's rolls
    before August 22, 1996, the enactment date of the Welfare Reform
    Act.  Nonetheless, all aliens, regardless of status, who otherwise
    meet the eligibility requirements for Medicaid are eligible for
    emergency Medicaid.  Unauthorized aliens are ineligible for full
    Medicaid but may qualify for emergency Medicaid.
    	Due to the eligibility of non-citizens for emergency Medicaid,
    many have questioned the impact of non-citizens on emergency
    departments.  Although some have pointed to unauthorized aliens
    as a key contributor to the problem of emergency departments, the
    reality is more complicated.  According to research, use of
    emergency rooms varies significantly across communities and
    studies have found that communities with more non-citizen
    residents generally have lower rates of emergency department use
    than communities with fewer non-citizen residents.
    	In 2003, Congress enacted the Medicare Prescription Drug
    Improvement and Modernization Act, which contains a provision,
    Section 1011, that provides reimbursement to States for emergency
    care afforded to unauthorized aliens.  For each fiscal year, fiscal
    year 2005 through fiscal year 2008, the provision appropriates
    $250 million, which is used to pay local governments, hospitals,
    and other providers for the cost of furnishing emergency health
    services to unauthorized aliens.
    	In February 2006, as we have discussed, Congress enacted the
    Deficit Reduction Act.  Prior to the Deficit Reduction Act, as a
    condition of an individual's eligibility for full Medicaid benefits,
    States were required to obtain a written declaration under penalty
    of perjury stating whether the individual is a U.S. citizen.  States
    were only required to obtain documentary evidence for an
    individual who declared that they were not citizens or nationals.
    	As a result of the changes made by Section 6036 of the Deficit
    Reduction Act, States now must obtain documentary evidence of
    both citizenship and identity from individuals who declare that
    they are U.S. citizens or nationals in order to receive Federal
    reimbursement for Medicaid services provided to these individuals.
    This requirement applies to initial determinations and
    redeterminations of eligibility made on or after July 1, 2006.  The
    requirement does not change the Medicaid documentation
    requirement or rules for non-citizens.
    	At least three States have said that they will postpone
    implementation of the citizen documentation requirements because
    they need more time to prepare new policy guidelines, train
    eligibility workers, and advise Medicaid beneficiaries.  Two
    lawsuits have also been filed to challenge these requirements.
    	With the restriction for non-citizens on Medicaid eligibility,
    one question that arises is the extent to which non-citizens have
    private insurance.  The literature has consistently found that non-
    citizens have higher uninsurance rates than native born and
    naturalized U.S. citizens and these differences remain when
    controlling for factors such as poverty, education, and labor force
    participation.  However, there is no consensus on the impact of
    non-citizens on the overall U.S. uninsured population.  For
    example, one report for that non-citizens accounted for 59 percent
    of the increase in the uninsured population from 1994 to 2003.
    	Nonetheless, another commission study found that the impact
    of non-citizens on the uninsured population depended on which
    years were analyzed and grouped together, concluding that
    immigration trends are not responsible, in large part, for the
    increase in the number of uninsured.
    	Due to high uninsurance rates among unauthorized aliens and
    their ineligibility for Medicaid, several studies have focused on the
    health-related cost of unauthorized aliens.
    	Since it is extremely difficult to get accurate data on
    unauthorized aliens, many studies make assumptions about the
    number of unauthorized aliens and their service usage.  Some of
    these studies survey immigrant communities and ask immigrant
    status, while others ask local agencies to estimate the cost of
    services provided to the unauthorized aliens, or others use proxies
    such as those who provide a false Social Security number, to
    determine who is an unauthorized alien.  Each of these methods
    has strengths and weaknesses, and none provides a reliable
    estimate upon which researchers agree.
    	A 2004 study by the Government Accountability Office, GAO,
    concluded that since hospitals do not generally collect information
    on patients' immigration status, an accurate assessment of the
    impact of unauthorized aliens on hospitals' uncompensated care
    costs remain elusive.  Over 95 percent of the hospitals which
    responded to the GAO survey used a lack of a Social Security
    number as the only method to identify unauthorized aliens.  It is
    unclear whether this method over or under-estimates the amount of
    care provided to unauthorized aliens.
    	The GAO study also reviewed the reported Medicaid spending
    for the 10 States with the highest estimated unauthorized
    population and found that emergency Medicaid expenditures for
    the 10 States have increased over the past several years but remain
    less than 3 percent of each State's total Medicaid expenditures.
    Nonetheless, the study found that between 2000 and 2002, in 9 of
    the 10 States reviewed, the State's emergency Medicaid
    expenditures grew faster than the total Medicaid expenditures.
    	In sum, it is unclear what the true impact of unauthorized aliens
    is on Medicaid and the health delivery system.
    	Thank you once again for your invitation to be here today and I
    am at your disposal for any questions.
    	MR. DEAL.  Thank you.  Mr. Ortiz.
    	[The prepared statement of Dr. Siskin follows:]

    PREPARED STATEMENT OF DR. ALISON SISKIN, SPECIALIST IN
    IMMIGRATION LEGISLATION, DOMESTIC SOCIAL POLICY DIVISION,
    CONGRESSIONAL RESEARCH SERVICE

            Thank you Chairman Deal, Ranking Member Brown, and
    Distinguished Members of the Committee for the invitation to
    appear before you today to speak about the financial impact of
    unauthorized aliens on Medicaid and Health Delivery Systems.  I
    am Alison Siskin, a Specialist in Immigration Legislation at the
    Congressional Research Service.  My testimony today will focus
    on a discussion of the Medicaid eligibility of noncitizens, and two
    recent legislative initiatives, one to reimburse providers for the cost
    of uncompensated care provided to unauthorized aliens, and the
    other to require certain documentation for those applying for
    Medicaid.  My testimony will conclude with a discussion of
    studies on uninsurance rates for noncitizens, and estimates of the
    uncompensated cost of providing health care for unauthorized
    aliens.
            Currently, noncitizens' eligibility for federal Medicaid benefits
    largely depends on their immigration status and whether they
    arrived (or were on a program's rolls) before August 22, 1996, the
    enactment date of the Personal Responsibility and Work
    Opportunity Reconciliation Act (PRWORA).  Legal permanent
    residents (LPRs) entering after August 22, 1996, are barred from
    Medicaid for five years, after which coverage becomes a state
    option.  States have the option to use state funds to provide
    medical coverage for LPRs within five years of their arrival in the
    United States.  Refugees and asylees are eligible for  Medicaid for
    seven years after arrival.  After the seven years, they may be
    eligible for Medicaid at the state's option.  LPRs with a substantial
    (10-year) U.S. work history or a military connection are eligible
    for Medicaid without regard to the 5-year bar.  LPRs receiving
    Supplemental Security Income (SSI) on or after August 22, 1996
    are eligible for Medicaid since Medicaid coverage is required for
    all SSI recipients.  Finally, in the case of LPRs sponsored for
    admission after 1997, the income and resources of their sponsor
    are "deemed" available to them when judging their eligibility.
    Nonetheless, all aliens regardless of status who otherwise meet the
    eligibility requirements for Medicaid are eligible for emergency
    Medicaid.  Thus, unauthorized aliens are ineligible for Medicaid,
    but may qualify for emergency Medicaid.
            Emergency Medicaid covers unauthorized aliens,
    nonimmigrants, and LPRs within the first five years of arrival for
    emergency conditions if they meet the other eligibility
    requirements of the program.  Under the Emergency Medical
    Treatment and Active Labor Act,  all Medicare-participating
    hospitals with emergency departments treat all medically unstable
    patients and women in active labor regardless of their ability to
    pay.  Unauthorized aliens who are otherwise eligible for Medicaid
    except for their illegal status may receive "medical assistance
    under Title XIX of the Social Security Act ...  for care and
    emergency services that are necessary for the treatment of an
    emergency medical condition (as defined in Section 1903(v)(3) of
    such Act) of the alien involved and are not related to an organ
    transplant procedure."  This language from the Personal
    Responsibility and Work Opportunity Reconciliation Act of 1996
    restates and carries forward a provision which had been enacted 10
    years previously as an amendment to the Medicaid provisions of
    the Social Security Act.

            Section 1903(v)(3) defines "emergency medical condition" as:

            a medical condition (including emergency labor and delivery)
    manifesting itself by acute symptoms of sufficient severity
    (including severe pain) such that the absence of immediate
    medical attention could reasonably be expected to result in -
    (A) placing the patient's health in serious jeopardy, (B) serious
    impairment to bodily functions, or (C) serious dysfunction of
    any bodily organ or part.

            Like other Medicaid recipients, unauthorized aliens must
    demonstrate that they are state residents, and many are not (or are
    unable or unwilling to prove that they are).  This is particularly
    true of unauthorized aliens requiring emergency hospital care
    during attempted illegal entries.  To be eligible for emergency
    Medicaid, unauthorized aliens must also be poor and either aged,
    disabled, or members of a family with children.  Working age
    single males, for example, are generally not eligible for any form
    of Medicaid regardless of their financial status or residence.
            Due to the eligibility of noncitizens for emergency Medicaid,
    many have questioned the impact of noncitizens on emergency
    departments.  Although some have pointed to unauthorized aliens
    as a key contributor to problems of emergency departments, the
    reality is more complicated.  According to research, use of
    emergency care varies significantly across communities, and
    contrary to popular perception, studies have found that
    communities with more noncitizen (alien) residents generally have
    lower rates of emergency department use than communities with
    fewer noncitizen residents.  (For example see, Peter J.
    Cunningham, "What Accounts for Differences in the Use of
    Hospital Emergency Departments Across U.S. Communities,"
    Health Affairs-Web Exclusive, Jul.  18, 2006, pp.  W324-W336.  )
            In 2003, Congress enacted The Medicare Prescription Drug,
    Improvement and Modernization Act of 2003 (P.L. 108-173),
    which contains a provision (known as section 1011) that provides
    reimbursement to states for emergency care afforded to
    unauthorized aliens.  For each fiscal year, FY2005-FY2008, the
    provision appropriates $250 million of which:
    	$167 million is allotted to states based on the percentage of
    unauthorized aliens residing in the state compared to the
    total number of unauthorized aliens in the United States;
    and
    	$83 million is allocated to the six states with the highest
    percentage of unauthorized alien apprehensions for the
    fiscal year, based on the percentage of apprehensions in the
    state compared to the number of apprehensions for all such
    states.

            P.L.  108-173 directs the Secretary of Health and Human
    Services (HHS) to pay local governments, hospitals, or other
    providers located in the state (including providers of services
    rendered through an Indian Health Service facility) for the costs of
    furnishing emergency health care services to unauthorized aliens
    during that fiscal year.  Advanced payments will be made quarterly
    based on the applicants' projected expenditures.
    	In February 2006, Congress passed the Deficit Reduction Act
    (DRA, P.L. 109-171) which contains a provision requiring certain
    documentation for those applying for Medicaid who claim U.S.
    citizenship.   Prior to the DRA, as a condition of an individual's
    eligibility for full Medicaid benefits, states were required to obtain
    a written declaration, under penalty of perjury, stating whether the
    individual is a citizen or national of the United States.  States were
    only required to obtain documentary evidence from individuals
    who declared that they were not citizens or nationals.
            In July 2005, the Inspector General (IG) for the Department of
    Health and Human Services released a report entitled, Self-
    Declaration of U.S. Citizenship for Medicaid.   The report found
    that as of 2004, 47 states allowed self-declaration of U.S.
    citizenship for determinations of Medicaid eligibility, but 44 of
    those states required documentary evidence of citizenship if the
    statement seems questionable.  Montana, New Hampshire, New
    York, and Texas did not permit self-declaration of citizenship for
    determinations of Medicaid eligibility.  In addition, the report
    found that 27 states did not verify the accuracy of U.S. citizenship
    statements as part of their post-eligibility quality control.
            While the IG noted that Centers for Medicare and Medicaid
    Services (CMS) had encouraged self-declaration in an effort to
    simplify and accelerate the Medicaid application process which
    resulted in rapid enrollment, self-declaration also could have lead
    to inaccurate eligibility determinations for those who provide false
    citizenship statements.  Nonetheless, the report failed to identify
    the extent to which current Medicaid beneficiaries were ineligible
    based on citizenship or the extent to which eligible individuals
    failed to apply for Medicaid in states that require proof of U.S.
    citizenship as a condition of eligibility.
            As a result of changes made by 6036 of DRA, states now
    must obtain documentary evidence of both citizenship and identity
    from individuals who declare that they are citizens or nationals of
    the U.S. (with certain exceptions) in order to receive federal
    reimbursement for Medicaid services provided to these individuals.
    This requirement applies to initial determinations and
    redeterminations of Medicaid eligibility made on or after July 1,
    2006.  The requirement does not change Medicaid documentation
    (or other) rules for noncitizens.
            The CMS provided states with initial guidance on the Medicaid
    citizenship documentation provision in DRA on June 9, 2006.  An
    interim final rule (the contents of which differ from CMS's initial
    guidance) was published in the Federal Register on July 12, 2006.
    The interim rule explains who is exempt from the documentation
    provision, what types of documents and data matches may be used
    to prove citizenship (or nationality) and identity, and how states
    must comply with the new requirement.
            At least three states (Ohio, California, and North Carolina)
    have said that they will postpone implementation of the Medicaid
    citizenship documentation requirement because they need more
    time to prepare new policy guidelines, train eligibility workers, and
    advise Medicaid beneficiaries.  Two lawsuits have also been filed
    to challenge the requirement.  In addition, according to a Medicaid
    official in Tennessee, the directions given to their Medicaid
    directors to implement DRA 6036 are almost identical to those in
    the federal letter sent to the states from CMS on how to implement
    the provision.  The state did not have time to develop their own
    guidance as the CMS letter was sent several days after the
    provision was supposed to be implemented.  The official noted that
    the provision has proven difficult to implement for children,
    especially those who are not yet school-aged.
            With the restrictions for noncitizens on Medicaid eligibility,
    one question that arises is the extent to which noncitizens have
    private insurance.  The literature has consistently found that
    noncitizens have higher uninsurance rates than native born and
    naturalized U.S. citizens, and these differences remain when
    controlling for factors such as poverty, education and labor force
    participation.  For example, a Kaiser Commission study found that
    in 2003, 47% of noncitizens lacked health insurance compared to
    15% of native born citizens.  In addition, another Kaiser
    Commission study found that in 2003, 26% of low income children
    with noncitizen parents lacked health insurance while only 16% of
    low income children with citizen parents lacked health insurance.
    These findings are similar to a CRS study which used data from
    2001, and found that noncitizens were three times more likely to be
    uninsured than U.S. citizens and naturalized foreign born
    individuals.   Forty-four percent of noncitizens were uninsured
    compared to 17% of naturalized U.S. citizens and 12% of native
    born U.S. citizens.
            Although there appears to be general agreement that
    noncitizens are more likely than U.S. citizens to lack health
    insurance, there is not a consensus on the impact of noncitizens on
    the overall U.S. uninsured population.  For example, a report by
    the Employee Benefits Research Institute (EBRI) found that
    noncitizens accounted for 59% of the increase in the uninsured
    population from 1994 to 2003.   Similarly, another study found that
    by applying the uninsurance rates of unauthorized aliens in Los
    Angeles County to the entire country, unauthorized aliens
    accounted for one-third of the increase in the number of uninsured
    adults in the United States between 1980 and 2000.
            Nonetheless, a Kaiser Commission study found that the impact
    of noncitizens on the uninsured population depended on which
    years were analyzed and grouped together.  The Kaiser
    Commission study analyzed the uninsured population during three
    periods: 1994-1998; 1998-2000; and 2000-2003.  The Kaiser
    Commission study found that when combining the data from 1998
    through 2003, almost two-thirds of the increase in the uninsured
    population was due to noncitizens, but the result was largely driven
    by the reduction in the number of uninsured U.S. citizens between
    1998 and 2000.  In contrast, the report noted that in the 1994 to
    1998 and 2000 to 2003 periods, most of the growth in the
    uninsured population was due to native born U.S. citizens.
    Seventy-four percent of the growth in the uninsured population
    between 1994 to 1998 was due to native born U.S. citizens while
    10% was due to noncitizens.  Likewise, between 2000 and 2003,
    24% of the growth in the uninsured population was due to
    noncitizens, while 71% of the growth could be attributed to native
    born U.S. citizens.  The Kaiser Commission study concluded that
    immigration trends are not responsible, in large part, for the
    increase in the number of uninsured.  In addition, the researchers
    noted that, mostly due to the fact that noncitizens comprise a much
    smaller proportion of the population than U.S. citizens,
    noncitizens would have to fare dramatically worse than citizens to
    be responsible for the majority of the change in the uninsured
    population.
            Due to high uninsurance rates among unauthorized aliens and
    their ineligibility for Medicaid, several studies have focused on the
    health-related costs of unauthorized aliens on state and local
    governments, and health care providers.  It is very difficult to
    enumerate a population which is trying to avoid detection by the
    government.  The main sources of socioeconomic information in
    the United States, the Current Population Survey (CPS), the
    Decennial Census of the Population (Census), and the American
    Community Survey, collected by the Census Bureau, ask
    citizenship status, but not immigration status.  Thus, it is not
    possible to use these data sources in calculating the healthcare cost
    of unauthorized aliens.
            Since it is extremely difficult to get accurate data on
    unauthorized aliens, many studies make assumptions about the
    number of unauthorized aliens, their service usage, and their
    revenue contributions.  As a result, many studies which attempt to
    estimate the cost of health care for unauthorized aliens in the
    United States focus on limited geographic regions (e.g., border
    communities, states, or cities).  Some of these studies survey
    immigrant communities and ask immigration status, while others
    ask for local agencies to estimate the cost of services provided to
    unauthorized aliens.  Other studies use proxies, such as those who
    provided a false Social Security number, to determine who is an
    unauthorized alien.  Each of these methods has strengths and
    weaknesses, and none provides a reliable estimate upon which
    researchers agree.
            The following is a discussion of selected studies which
    estimate the cost of health care provided to unauthorized aliens.  I
    have focused on studies completed during the previous 10 years.
    In addition, this is not an exhaustive review of the literature on the
    cost of health care for unauthorized aliens in the United States.
            GAO Study (2004).  In May 2004, the Government
    Accountability Office (GAO) released a study entitled
    Undocumented Aliens: Questions Persist about Their Impact on
    Hospitals' Uncompensated Care Costs.  The study concluded that
    since hospitals do not generally collect information on patients'
    immigration status, an accurate assessment of the impact of
    unauthorized aliens on hospitals' uncompensated care costs
    "remains elusive."  GAO surveyed 503 hospitals, but as a result of
    the low response rate to the survey, was unable to determine the
    cost of uncompensated care provided to unauthorized aliens.  In
    addition, over 95% of the hospitals which responded to the survey
    used the lack of a Social Security number as the only method to
    identify unauthorized aliens.  It is unclear whether this method
    over or under estimates the amount of care provided to
    unauthorized aliens.
            The GAO study also reviewed the reported Medicaid spending
    for the 10 states with the highest estimated unauthorized
    populations: Arizona, California, Florida, Georgia, Illinois, New
    Jersey, New Mexico, New York, North Carolina, and Texas.
    Although states are not required to report to CMS the amount of
    Medicaid expenditures for unauthorized aliens, several states
    provided data or suggested to GAO that most of their emergency
    Medicaid expenditures were for services provided to unauthorized
    aliens.  In addition, five of the states reported that more than half
    of emergency Medicaid expenditures were for labor and delivery
    services.
            GAO found that emergency Medicaid expenditures for the 10
    states have increased over the past several years but remain a small
    proportion, less than three percent, of each state's total Medicaid
    expenditures.  Nonetheless, the study found that, between FY2000
    and FY2002, in nine of the 10 states reviewed, the state's
    emergency Medicaid expenditures grew faster than the total
    Medicaid expenditures.
            Impact of Illegal Immigration on Mississippi (2006).  The
    Mississippi Office of the State Auditor estimated that $35 million
    of $504.6 million spent for uninsured healthcare services in 2004
    may be due to unauthorized aliens.  This number was estimated by
    using a finding from the RAND Corporation that 68% of
    unauthorized alien adults lacked health insurance.  Importantly, the
    report noted that "because no data regarding immigration status is
    collected, it is difficult to determine the accuracy of this
    estimate..."
            Impact of Illegal Immigration on Minnesota (2005).  The
    Office of Strategic Planning and Results Management for the State
    of Minnesota reported that in FY2005, unauthorized aliens cost
    Minnesota health assistance programs approximately $35.5
    million, of which approximately $17.3 million was paid by the
    state.  The cost included:
    	$16.3 million, for Minnesota Emergency Medical Assistance,
    which covers all emergency services including labor and
    delivery, of which the state and the federal governments each
    paid 50% ($8.15 million).
    	$15.5 million for Minnesota State Children's Health Insurance
    Program (SCHIP) which covers medical costs for pregnant
    women without other health insurance through the month of
    birth.  The state paid 35% of the costs ($5.4 million) while the
    federal government paid 65% of the costs ($10.1 million).
    	$3.7 million for Minnesota Medical Assistance program's state
    noncitizen pregnant women fund, all of which was paid by the
    state.

            The High Cost of Cheap Labor:  Illegal Immigration and the
    Federal Budget (2004).  This study released by the Center for
    Immigration Studies uses the March Current Population Survey
    (CPS) and the decennial census, and relies on the methodology
    used in two other respected studies of the fiscal effects of
    immigration:  (1) The New Americans (1997) by the National
    Research Council (NRC); and (2) Immigrants in New York: Their
    Legal Status, Incomes and Taxes (1998) by researchers at the
    Urban Institute.  Unauthorized aliens are estimated by using
    socioeconomic characteristics to assign a probability to each
    respondent that the respondent is an unauthorized alien.  The study
    uses households as the unit of analysis arguing, as in the NRC
    study, that the household is the primary unit through which taxes
    are paid and services used.  It is important to note that although the
    head of the household is an unauthorized alien, it is possible that
    others in the household are legally present, or United States
    citizens.
            The study noted that ascertaining the cost of unauthorized alien
    households presents complex fiscal questions, and estimated that
    on average, each household headed by unauthorized aliens cost the
    federal treasury $658 for Medicaid (including SCHIP) and $591
    for medical care for the uninsured in FY2002.  In comparison, the
    study estimated that in FY2002, legal alien headed-households, on
    average, cost the federal treasury $1,232 for Medicaid (including
    SCHIP) and $123 for medical care for the uninsured.
    Care for the Uninsured Non-citizens: A Growing Burden on
    Florida's Hospitals (2003).   Using case studies of 700
    unauthorized aliens from 39 hospitals/health systems representing
    56 hospitals or 26% of the acute care hospitals in Florida, the
    Florida Hospital Association reported that these 39 hospitals/health
    systems spent $40.2 million on care for unauthorized aliens.
    Three-quarters of the unauthorized alien patients incurred charges
    below $50,000, while 32 unauthorized alien patients incurred
    charges in excess of $250,000 each, totaling more than $21.4
    million.
            Medical Emergency:  Costs of Uncompensated Care in
    Southwest Border Counties (2002).  In 2002, the United
    States/Mexico Border Counties Coalition released a study entitled
    Medical Emergency: Costs of Uncompensated Care in Southwest
    Border Counties.  The survey conducted statistical modeling by
    identifying sets of non-border communities that "capture essential
    characteristics of each border community with respect to the
    demand for emergency medical services."  The researchers note
    the complexity of  matching border communities with other
    communities, as the counties on the U.S./Mexico border are unique
    on many important dimensions, and this complexity may have
    impacted the results.  The researchers then performed a linear
    regression, and assumed the differences between the border
    communities and the similar non-border communities could be
    attributed to unauthorized aliens.  The study concluded that in
    2000, $189.6 million was spent by hospitals in the Southwest
    border communities to provide uncompensated care to
    unauthorized aliens.
            Health Care for Unauthorized Immigrants:  Who Pays?
    (2001).  The House Research Organization for the Texas House of
    Representatives asserted that the Harris County Hospital District
    estimated that between 1999 and 2001 it spent $330 million on
    health care for unauthorized aliens, of which $105 million was
    reimbursed by the federal government.  The study failed to provide
    methodology for the estimate, and as a result, it is impossible to
    assess the validity of the estimate.
            In sum, it is unclear what the true impact of noncitizens is on
    Medicaid and the health delivery system.  Although noncitizens are
    more likely than citizens to be uninsured, it is not known to what
    extent noncitizens affect the overall uninsurance rate for the U.S.
            Thank you once again for your invitation to be here today, and I
    am at your disposal for any questions you may have.

    	MR. ORTIZ.  Thank you, Chairman Deal and members of the
    Energy and Commerce Committee for holding this field hearing
    today in Dalton, Georgia.  I appreciate your leadership on this
    issue and am grateful to testify about Georgia's experience in
    implementing the Medicaid Citizenship Provisions of the DRA.
    	Medicaid has grown to become the second largest budget item
    in the State of Georgia, only behind public education.  The people
    of Georgia have been very clear that they expect us to be good
    stewards of the State's resources and to be fair and just in
    dedicating those resources to those most in need.
    	Therefore, last December, Governor Perdue instructed the
    Georgia Department of Human Resources, the State agency that
    administers Medicaid enrollment, to institute more stringent
    documentation requirements for both citizenship and income
    eligibility.
    	As of January 1, 2006, applicants for Georgia's Family
    Medicaid program have been required to provide documents such
    as W-2 forms, pay stubs, or income tax returns before becoming
    eligible for benefits.  The only exception to this policy is for
    pregnant women and their newborns, allowing them to receive
    immediate prenatal and postnatal care.
    	Federal law requires that taxpayer-funded benefits be limited to
    those who are lawfully in the United States and income verification
    requirements serve as an additional check for legal U.S.
    citizenship.  As the Governor said in December, documentation
    verification reduces fraud in the taxpayer-funded healthcare system
    and ensures that Medicaid recipients are legal residents entitled to
    public assistance.
    	Since implementation, we have seen a sizable reductions in our
    caseload, which has been attributed to the combination of both
    more rigorous citizenship and income documentation
    requirements.  This fact is strong evidence of fraud and abuse
    inherent under the previously allowed self-declaration prerequisite.
    	In January 2006, Congress passed the Deficit Reduction Act.
    This bill contains many of the Medicaid flexibilities that the
    Nation's governors have been asking for and I would like thank the
    Committee and Congressman Barton and Chairman Deal for
    working with the governors on this process.
    	The DRA Improved Enforcement of Documentation
    Requirements contained requirements largely similar to those
    document verification regulations instituted in Georgia on January
    1.
    	In the implementation of citizenship verification requirements,
    the Governor made it very clear that first, all new document
    requirements needed to be in compliance with Federal law and
    regulation; second, that our State eligibility workers were to be
    dedicated to diligently assist citizens and qualified aliens to obtain
    the documentation necessary for Medicaid eligibility.
    	When an applicant lacks the proper documentation, our
    practice is to hold the application open for the maximum time
    period allowed by CMS regulation.  During that time, eligibility
    workers will assist applicants to produce the satisfactory
    documentation.
    	In Georgia, 3000 caseworkers across 159 counties determine
    Medicaid eligibility.  They have been trained to integrate these
    new regulations into their daily work, while continuing to provide
    supportive assistance to Medicaid applicants.
    	To ensure the efficient and successful eligibility determination
    for qualified applicants, Georgia has taken full advantage of
    additional flexibilities allowed under the DRA, such as cross-
    matching of State vital statistics; not requiring verification if the
    individual has already been deemed eligible for SSI or Medicare;
    presumptive eligibility for pregnant women and deemed newborn
    eligibility.
    	One thing we have noticed is that our increased focus on
    eligibility documentation is enhancing accountability across our
    system.  When we communicate well with our consumers, more of
    them come to our front door of our system with the documents in
    hand ready and able to prove citizenship and verify their income.
    If they do not have the documentation when they come to the front
    door, we work diligently to ensure that they have the
    documentation in hand when they are determined eligible.  We see
    this as a service to the citizens of Georgia.
    	In conclusion, the United States is a great country with great
    benefits.  Our expectations are that those we serve should be
    eligible and we have a responsibility to verify that eligibility.  We
    stand ready in Georgia to get the right work done the right way.
    	Thank you again, Chairman Deal, for your time and continued
    leadership on this issue.
    	[The prepared statement of Abel C.  Ortiz follows:]

    PREPARED STATEMENT OF ABEL C. ORTIZ, HEALTH AND HUMAN
    SERVICES POLICY ADVISOR, OFFICE OF THE GOVERNOR, STATE OF
    GEORGIA

            Thank you, Chairman Deal, and Members of the Energy and
    Commerce Committee for holding this field hearing today in
    Dalton, Georgia.  I appreciate your leadership on this issue and am
    grateful for the opportunity to testify regarding Georgia's
    experiences implementing the Medicaid Citizenship
    Documentation Provisions of the Deficit Reduction Act (DRA).
            Medicaid has grown to become the second largest budget item
    in our state, behind only public education.  The people of Georgia
    have been very clear that they expect us to be good stewards of the
    state's resources, and to be fair and just in dedicating those
    resources to people most in need.
            Therefore, last December Governor Sonny Perdue instructed
    the Georgia Department of Human Resources, the state agency that
    administers Medicaid enrollment, to institute more stringent
    documentation requirements for both citizenship and income
    eligibility.
            As of January 1, 2006, applicants for Georgia's Family
    Medicaid program have been required to provide documents such
    as W-2 forms, pay stubs, or income tax returns before becoming
    eligible for benefits.  The only exception to the policy is for
    pregnant women and their newborns, allowing them to receive
    immediate prenatal and postnatal care.
            Federal law requires that taxpayer-funded benefits be limited to
    those who are lawfully in the United States and the income
    verification requirement serves as an additional check for legal
    U.S. citizenship.  As the Governor said in December, document
    verification reduces "fraud in the taxpayer-funded healthcare
    system and ensure(s) that Medicaid recipients are legal residents
    entitled to public assistance."
            Since implementation we have seen sizable reductions in our
    caseload which we attribute to the combination of more rigorous
    citizenship and income documentation requirements.  This fact is
    strong evidence of fraud and abuse inherent under the previously
    allowed "self-declaration" prerequisite.
            In January 2006, Congress passed the Deficit Reduction Act
    (DRA).  The bill contained many of the Medicaid flexibilities the
    Nation's Governors have been asking for and I would like to thank
    the Committee, Chairman Barton and Chairman Deal for working
    with the Governors in that process.
            Section 6036 of the DRA, Improved Enforcement of
    Documentation Requirements, contained requirements largely
    similar to document verification regulations instituted in Georgia
    on January 1.
            In implementing the citizenship verification requirement, the
    Governors' directions were clear: First, all new documentation
    requirements were to be in compliance with federal law and
    regulation and, second, our State Medicaid eligibility workers were
    directed to work diligently to assist any citizen or qualified alien in
    obtaining the documentation necessary for Medicaid eligibility.
            When an applicant lacks the proper documentation, our
    practice is to hold that application open for the maximum time
    period allowed by CMS regulations.  During that time eligibility
    workers will assist the applicant to produce satisfactory
    documentation.
            In Georgia, 3,000 caseworkers, across 159 counties, determine
    Medicaid eligibility.  They have been trained to integrate these
    new regulations into their daily work, while continuing to provide
    supportive assistance to Medicaid applicants.
            To ensure the efficient and successful eligibility determination
    for qualified applicants Georgia has taken full advantage of
    additional flexibilities allowed under the DRA, such as:
     Cross-matching state vital statistics;
     Not requiring verification if the individual has already been
    deemed eligible for SSI and Medicare;
     Presumptive eligibility for pregnant women;
     Deemed newborn eligibility.

            One thing we have noticed is that our increased focus on
    eligibility documentation is enhancing accountability throughout
    our system.  When we communicate well with our customers, more
    of them are coming to the front door of our system with
    documentation in hand, ready and able to prove their citizenship
    and verify their income.  If they don't have the documentation
    when they come in the front door, we work diligently to insure that
    they have the documentation in hand when they are determined
    eligible.  We see this as a service to citizens of Georgia.
            In conclusion, the United States is a great country with great
    benefits.  Our expectations are that those we serve should be
    eligible and we have a responsibility to verify that eligibility.  We
    stand ready in Georgia to get the right work done, the right way.
            Again, thank you Chairman Deal for your time and continued
    leadership on these important issues.

    	MR. DEAL.  Well, thank you all for your testimony.  I think I
    have agreement from my panel members up here that we are going
    to limit our question time to 5 minutes for each of you since we are
    running a little behind our schedule and we have another panel that
    is coming up.  And I will begin that.
    	First of all, as you  mentioned, Dr. Siskin, prior to the DRA, we
    had a system in place that said you had to certify, subject to
    perjury, that you were a citizen and, therefore, eligible--or other
    category--that you were eligible for participation in Medicaid.  Are
    you or any of the panel members ever aware of anybody who has
    ever been prosecuted for falsely certifying that they were eligible?
    	MS. SHEIL.  I am not.
    	MS. SISKIN.  Nor am I.
    	MR. ORTIZ.  I am not.
    	MR. DEAL.  Well, that is similar to the answers I got on the
    other question which I am going to ask you now too.
    	Under the 1996 Immigration Reform Act, where we said that if
    you want to sponsor someone to come into this country, you
    assume responsibility as a sponsor and to be responsible for the
    cost so they do not become a drain on our social welfare system.
    Are any of you ever aware of anyone ever being charged as a
    sponsor and sent a bill for the cost of their person they sponsored?
    	MS. SISKIN.  Not for public benefits.  There have been cases
    where somebody who was sponsored sued their sponsor for not
    providing support, but no one has gone after somebody for a public
    benefit, as far as I know.
    	[Laughter.]
    	MR. ORTIZ.  I am not aware of anybody.
    	MS. SHEIL.  I am not aware that anybody has been charged;
    however, in the eligibility determination process, eligibility
    workers should be collecting information on the income and assets
    of the sponsor and considering that income in developing their
    eligibility.  But I do not know to what extent that is being done.
    	MR. DEAL.  Even if we are collecting that information, how do
    we then effectively communicate it to places like public hospitals
    where they are faced only with the option of charging it off as
    uncollectible debt?
    	MS. SISKIN.  Well, in the last 2 years, supposedly it is now
    being captured electronically in the SAVE system.  Prior to that,
    you would have had to fill out a form with the former INS and now
    the Department of Homeland Security, requesting information on
    an alien sponsor.  But I am not sure the hospitals have access to the
    SAVE system.
    	MR. DEAL.  That is the problem, is it not?  We have problems
    communicating within our own agencies and we collect all this
    information, sometimes do not share it within our own agencies, as
    we have all heard the story, but we certainly have not shared it
    with the people who are on the front line, who are incurring the
    costs and have no one to send a bill to.
    	That ties in with my concern about the expanded guest worker
    provisions of the Senate bill where it appears on their terms would
    be to repeat this same process, which I think is totally ineffective.
    	Let me though follow up with the electronic verification.
    Senator Rogers mentioned it I believe and you all have alluded to
    it.
    	Mr. Ortiz, are you at the State level using the electronic
    verification system and what does that tie you in to?
    	MR. ORTIZ.  We are using it and we use our cross matches with
    our State vital records and then we use it to cross match with
    Medicare and Social Security.
    	MR. DEAL.  And that is on the documentation for certification
    of eligibility?
    	MR. ORTIZ.  Yes, it is.
    	MR. DEAL.  Okay.  Is it working pretty well so far?
    	MR. ORTIZ.  We have not had any reports of any slow down in
    processing.  Our workers have just completed training last week, it
    has been ongoing and they just completed it last week and we have
    had no reports of any problems gaining that information through
    the electronic system.
    	MR. DEAL.  Ms. Sheil, since you are going to be responsible
    for the implementation of the new DRA provisions, have you had
    any real concerns that have surfaced in using the proper
    verification and documentation that the law requires?
    	MS. SHEIL.  We have had numerous phone calls and training
    sessions with our State agencies and they understand the policies.
    I continue to answer questions about the policies, so I think that
    implementation for the vast majority is going very well.
    	MR. DEAL.  And your testimony, Mr. Ortiz, alludes to this, and
    says it I think rather plainly, quite frankly, that if someone comes
    in and asks for Medicaid certification and they do not have their
    documents, you work with them to try to obtain those documents,
    if they are validly presenting themselves; is that correct?
    	MR. ORTIZ.  That is true.  And that has actually been true for
    many, many years.  I have experience both as a hospital social
    worker, an economic social worker, a social worker in a mental
    health clinic, and also as a foster care supervisor; and through my
    many years of being a social worker, it has always been the
    eligibility worker and other social workers outside the system who
    help applicants get that type of information, because it has always
    been needed.  So this is an ongoing enhanced version of that.
    	MR. DEAL.  Thank you.  My time has expired.  Ms. Solis.
    	MS. SOLIS.  Thank you.
    	Ms. Siskin, thanks for joining us here today on such short
    notice and I am sure we will hear a lot more about immigrants and
    supposedly their responsibility for the problems we are facing with
    the Nation's healthcare system.  If I understand your testimony, the
    situation for me is not very clear and simple.  For example, is it not
    true that looking at emergency department use by non-citizens,
    communities with higher numbers of non-citizen residents have
    lower rates of emergency department use than communities with
    more citizen residents?
    	MS. SISKIN.  Yes, that is what the studies have found.
    	MS. SOLIS.  And also, is it not true that communities with
    higher use of emergency departments also tend to have longer
    waiting periods for patients seeking medical appointments when
    sick?
    	MS. SISKIN.  That I would have to check on for you.
    	MS. SOLIS.  And is it not true that while immigrants tend to
    have higher rates of uninsurance than citizens, there is no clear
    consensus on the impact of non-citizens on the overall U.S.
    uninsured population?
    	MS. SISKIN.  That is true, the studies are all over the place on
    the impact.
    	MS. SOLIS.  And now looking at the use of government benefits
    by immigrants, can you tell me whether there is any reliable
    evidence or studies that have shown rampant fraudulent use of
    Medicaid services by those who are not eligible for it, by reason of
    citizenship?
    	MS. SISKIN.  I have not seen any studies like that.  In the CMS
    study--I am sorry, the Inspector General study from the
    Department of Health and Human Services that looked at this issue
    of self-declaration did not look at that issue.
    	MS. SOLIS.  Thank you.  My next question is for Ms. Sheil.  I
    know that your agency is in the process of issuing a final rule on
    the Medicaid citizenship documentation requirements that passed
    Congress.  And as you know, I along with 40 of my colleagues
    wrote a letter commenting on the rule and asking you to change
    some of the most egregious problems in the draft proposal.  In
    addition, Ranking Member Dingell and Health Subcommittee
    Ranking Member Brown and Government Reform Committee
    Ranking Member Waxman also sent you similar comments.
    	And I would like to ask that both sets of my comments be
    placed into the record.
    	[The information follows:]

    	The problem I see with the new requirement is that it really
    will wind up hurting many U.S. citizens and I think that is what
    some of us are trying to get to at this hearing today.
    	I understand that your boss, Dr. McClellan, already wrote in a
    letter to the Inspector General that States, and I quote, "States have
    little evidence that many non-eligible non-citizens are receiving
    Medicaid."  What we have as a result of this new law is more
    government bureaucracy to address a largely fictitious problem.  In
    fact, as a result of the new government burden, estimates are that
    one to two million American citizens could lose their healthcare.
    When we already have 46 million uninsured, and when we know
    that the uninsured and uncompensated are a major burden for our
    Nation's health providers, we should not be taking action that
    would make more Americans lose their healthcare coverage.
    	First, the rule will delay, in my opinion, access to necessary
    healthcare.  The rule says that a pregnant woman or a child, for
    example, who will meet all the requirements for eligibility but are
    waiting for their certified copy of their birth certificate to be
    mailed to them, cannot get their Medicaid coverage.  Is that
    correct?
    	MS. SHEIL.  Are you reading from a letter that Dr. McClellan
    wrote?
    	MS. SOLIS.  No.
    	MS. SHEIL.  This is your letter?  Could you repeat the question,
    please?
    	MS. SOLIS.  What I would like to know is if in fact, if a
    pregnant woman or a child, for example, who meets the
    requirements for eligibility but is waiting for the certified copy of a
    birth certificate to be mailed, would they be denied coverage?
    	MS. SHEIL.  Applicants have 45 days from the date of
    application to present documentation.
    	MS. SOLIS.  But if in fact they are found to be citizens after that
    time, they would still be denied?
    	MS. SHEIL.  State agencies have 45 days from the date of
    application to make a determination of eligibility.
    	MS. SOLIS.  So in a situation of an area like Georgia and
    victims of the Hurricane Katrina, how would that operate when
    most of the healthcare agencies there were flooded and many
    records are just not available?  Mr. Ortiz.
    	MR. ORTIZ.  When Hurricane Katrina hit Georgia, the only
    State that took in more evacuees than Georgia was Texas.  What
    we did is we worked with CMS to establish presumptive
    eligibility.  We also established links with the State of Louisiana
    and the State of Mississippi to verify with their drivers' license
    bureau and with their vital statistics, to verify that when
    individuals came in and said I was born in Louisiana, then we
    could verify that electronically and CMS provided us the flexibility
    and a time period to get that documentation in, but there was no
    disruption in coverage.  They were immediately eligible, it was
    called presumptive eligibility and the Federal government worked
    with us to make sure that nothing happened where there was a
    delay in payment or healthcare.
    	MS. SOLIS.  The other question I have just to wrap up, and I
    know my time is already running out, is with respect to foster care
    children and the fact that again, we are asking for proof of
    citizenship.  And as you know, the foster care system in many
    cases, a child jumps from one home to another, foster care is not
    always as stable as we would like and in many instances parents of
    foster care children do not want to provide proof of citizenship.
    What happens in a case for eligibility for that child if there is no
    documentation available?
    	MS. SHEIL.  We believe that the State agencies have more
    information about foster children probably than any other children
    on the caseload.  The requirement is not for Title IV-E, they get
    Title IV-E, it is for the Medicaid benefits.  When they are found
    eligible for Title IV-E, they are made eligible automatically for
    Medicaid.  The State agencies will consider them recipients and
    they will have, upon the first redetermination of eligibility, the
    responsibility to have collected information.  So they will have a
    year to gather the information.  The foster care workers will need
    to talk with the eligibility workers and they will use electronic
    means, they will be able to use matches with vital statistics, obtain
    birth certificates, just like any other type of case.
    	The policy that is outlined in the regulations provides very,
    very broad arrays of documents that may be used to document
    citizenship and identity.
    	MS. SOLIS.  Just one last question with respect to Native
    Americans also.  I understand that if they do not have adequate
    proof of citizenship for whatever reason, will they also be denied
    assistance?  I mean that is a big issue right now that I think many
    people have questions about.
    	MS. SHEIL.  The policy that we have outlined in the
    regulations, which is policy that basically has been a longstanding
    established policy used by the Social Security Administration with
    the types of documents that are listed.  They have a broad array of
    ways of documenting satisfactorily your citizenship.  Native
    Americans also can have birth certificates, we have utilized--
    	MS. SOLIS.  Some will not though.  So what would you use
    then?
    	MS. SHEIL.  There will be ample room for States to use cross
    matches with vital statistics agencies, they will be able to use some
    Native American documents we did list as acceptable documents.
    We do use Native American documents, they are allowed to prove
    identity.  But the policy is sufficient to provide much flexibility in
    terms of the documents that may be used.
    	MS. SOLIS.  Thank you.
    	MR. DEAL.  Dr. Norwood.
    	MR. NORWOOD.  Thank you very much, Mr. Chairman.
    	It is the time in the hearing at which I want to remind us that
    this hearing is not about immigrants, it is about illegal aliens.
    	I want to ask you, Dr. Siskin, if I may, are you here as a private
    citizen or an employee of CRS?
    	MS. SISKIN.  An employee of CRS.
    	MR. NORWOOD.  Okay.  Does CRS make assumptions about
    illegal aliens in their studies?
    	MS. SISKIN.  What do you mean by assumptions about illegal--
    	MR. NORWOOD.  You are the one that used assumptions all
    through your testimony.  That is what I mean.
    	MS. SISKIN.  We are very clear when we use census data or
    anything from the U.S. Census Bureau, that there is no way to
    determine who is an unauthorized alien.
    	MR. NORWOOD.  So you do use assumptions?
    	MS. SISKIN.  No, we would not say that those were
    unauthorized aliens, we would use the term non-citizen, meaning
    both legal and illegal aliens.
    	MR. NORWOOD.  So other studies do use assumptions and you
    do not.
    	MS. SISKIN.  Correct.
    	MR. NORWOOD.  Ah-ha.  I find that pretty interesting.
    	The Rand study, for example, that pointed out 65 percent of
    illegal aliens in this country do not have any kind of insurance,
    they account for about a third of the growth in non-insured people.
    Is that just an assumption?
    	MS. SISKIN.  I would have to look at the study and see how
    they came up with that.  I mean they may have extrapolated from
    an individual community but there is no census of the entire illegal
    population in this country.
    	MR. NORWOOD.  Recently, Colorado State Emergency
    Medicaid Program estimated $30 million in hospital and physician
    delivery costs for about 6000 illegal alien mothers, an average of
    $5000 per baby.  These 6000 births to illegal aliens represent 40
    percent of the births paid for by Medicaid in Colorado.  Is that an
    assumption?
    	MS. SISKIN.  It would depend how they are determining who is
    an unauthorized alien.  If they know for a fact that somebody is an
    unauthorized alien, but if they are using a proxy such as Social
    Security number or lack of Social Security number, it would be an
    assumption.
    	MR. NORWOOD.  Do you not suppose that the State of Colorado
    would know?  Mr. Ortiz, we would know in Georgia, would we
    not, sir?
    	MR. ORTIZ.  We would look at our emergency Medicaid and
    know where they come in and the fact that they continue--one of
    the things when we talk about emergency room services, people
    are under the misconception that the billing stops at the emergency
    room.  What tends to happen is it continues on when there is no
    emergency and you end up paying under emergency Medicaid for
    routine care and ongoing care.  And so I think it is more of a
    problem than just the emergency room you mentioned.
    	MR. NORWOOD.  Yes, it is.  But we do know information like
    that.  We may turn and look the other way or not want to admit it,
    but we do know those things happen.
    	Dr. Siskin, I am going to tell you honestly, I am upset with
    your testimony and plan to make a complaint to CRS about it.  We
    can go into this when we get back to Washington, but I want you
    to know I really did not appreciate the viewpoint you all took at
    CMS, not looking, in my opinion, at the whole picture.
    	Now Ms. Sheil--
    	MR. DEAL.  You said CMS.
    	[Applause.]
    	MR. NORWOOD.  I did not mean CMS, I beg your pardon--
    CRS.
    	Ms. Sheil, I want to tell you personally how much I appreciate
    the work you and Dennis Smith have been doing in an effort to try
    to get us to get this straightened out in this country so that only our
    own citizens receive the tax dollars that go into Medicare.  I have
    worked with CMS for 12 years and it is always hard, it is always
    difficult, and I have great feelings about how well you all have
    handled this, how hard you have tried to work this out for the
    American citizen to make sure that we do not let anybody drop
    through the cracks because we are trying to zero in on not letting
    foreigners get into our social system.
    	Explain to me just a little bit briefly what has basically changed
    in the law that has caused us to come to this point to where Mr.
    Ortiz--who by the way is doing a great job for our Governor, thank
    you, sir--is changing how we do business in Georgia and obviously
    they are changing how they do business in Colorado.  Just briefly
    explain to us what changes you see that we have made that have
    been most important.
    	MS. SHEIL.  Well, the change is that we will now have to have
    documentation of citizenship and identity to protect the Medicaid
    program's integrity.  There are no changes as far as citizens having
    to declare their citizenship, they have always had to do that, this is
    just a documentation requirement.  And we are now holding States
    financially responsible for implementing the provisions of the law.
    	MR. NORWOOD.  And now finally doing oversight--
    	MS. SHEIL.  Correct.
    	MR. NORWOOD.  --into making sure the States do.  Mr. Ortiz,
    again, I know what all you have been doing for Governor Perdue
    and I want to tell you, we from Washington appreciate all of your
    help and all the good works that you are doing.
    	Very quickly, now that you are actually verifying citizenship,
    have you run into any particular problems, or has there been this
    great burden on the State of Georgia to try to narrow this down?
    	MR. ORTIZ.  I think because the similar work has been done in
    the past for foster kids and you need to remember that Medicaid is
    a payer of last resort, so our eligibility workers already have to
    check SSI and Medicare before they make anybody eligible for
    Medicaid, so they are used to doing this type of work.  So this is
    something that is just an enhancement to what they are already
    doing.  And we see it as a necessary and responsible thing to do.
    	MR. NORWOOD.  I see my time is up, Mr. Chairman.  Thank
    you.
    	MR. DEAL.  I want to thank the panel.  We appreciate you
    being here today.
    	[Applause.]
    	MR. DEAL.  I would like to ask the third panel if they would
    please come forward.
    	While our third panel is coming up, I want to express
    appreciation to the staff here at Northwest Georgia Trade and
    Convention Center for allowing us to hold this field hearing here in
    their facility today.  You are very fortunate, we are all very
    fortunate here in the Dalton area, to have a facility of this type and
    the staff does a great job and I want to thank them all for their
    cooperation in facilitating this event today.
    	All right, we have the third and final panel and it will follow in
    the same distinguished fashion that the two that preceded it did.  I
    will introduce them at this time.  First of all, Mr. James E. Gardner,
    who is the President and Chief Executive Officer of Northeast
    Georgia Health Systems in Gainesville, Georgia; Mr. Charles
    Stewart, who is the Chief Executive Officer of Hutcheson Medical
    Center in Fort Oglethorpe, Georgia and Mr. Marty Michaels, who
    is Chair of the Georgia Chapter of the American Academy of
    Pediatricians and he is from Dalton, Georgia.
    	Gentlemen, thank you very much for being here and once
    again, I did not say it in the last panel, but your written testimony
    is a part of our record and we would ask you in your time of 5
    minutes if you would summarize your testimony and Mr. Gardner,
    I will begin with you.

    STATEMENTS OF JAMES E. GARDNER, JR., PRESIDENT AND CHIEF EXECUTIVE OFFICER,
    NORTHEAST GEORGIA HEALTH SYSTEM, GAINESVILLE, GEORGIA; CHARLES STEWART, CHIEF
    EXECUTIVE OFFICER, HUTCHESON MEDICAL CENTER: AND DR.  MARTY MICHAELS, CHAIR,
    GEORGIA CHAPTER, AMERICAN ACADEMY OF PEDIATRICS

    	MR. GARDNER.  Mr. Chairman, members of the Committee,
    thank you for inviting me to be with you today.  My name is Jim
    Gardner and I am President and Chief Executive Officer of
    Northeast Georgia Medical Center and Health System in
    Gainesville, Georgia.  Very much like Dalton, Gainesville is a
    community with a large Hispanic population.  Gainesville's
    poultry and booming housing industry have attracted both legal
    and illegal immigrants to our community.
    	Before I get to the crux of my comments about how illegal
    immigration affects our medical facility, let me take a moment to
    defend the hard line that I am about to take.
    	At the Medical Center, I am surrounded by people who chose
    their professions because of a genuine and sincere desire to help
    people.  We have a remarkable community of nurses and doctors
    who give of themselves completely and without prejudice to their
    patients.  During hectic office hours, many of our community
    physicians volunteer to treat indigent patients through the Hall
    County Medical Society's Health Access Initiative without
    compensation.  After they have worked their more than full-time
    jobs, many of our employees and physicians volunteer at the local
    Good News Clinics where free medical and dental services are
    provided for uninsured people who have no resources to pay for
    services.  We had many employees who volunteered for Katrina
    relief efforts during their families' spring break, and countless
    employees and physicians used personal vacation time to travel the
    world on mission trips to use their medical skills in third world
    countries.
    	I am very proud of the dedication and compassion of the
    people I work with.  I felt a need to say that, because in the current
    political climate, taking a position for any limitation on services to
    illegal immigrants is often painted with a broad brush as cruel and
    uncaring.  That would be an unfair representation of the
    organization I serve and represent today.  So I just wanted to get
    that clearly on the table before I begin to address how illegal
    immigration affects our healthcare facility.
    	In Hall County, the number of Hispanics has grown from 1
    percent in 1980 to just over 24 percent today, according to the
    2004 U.S. Census.  Roughly one in four in Hall County is
    Hispanic.  To identify how many illegal immigrants we have is
    difficult, as you have already heard.  But at Northeast Georgia
    Medical Center and in physician offices all over the region,
    providers must cover the expense of bilingual staff to care for
    patients, and print out all forms and educational materials in two
    languages.  In 2003, a local study "Healthy Hall" reported that 33
    percent of all Latinos are uninsured, which represents 60 percent of
    the uninsured in Hall County.  Uninsured patients face a huge
    burden on our health system and put our ability to care for the
    people in our region in jeopardy.
    	To the community, hospitals look like big business, with big
    money.  In realty, our hospital must spend over a million dollars a
    day to provide the care our community needs.  Even with our
    investment income, margins have declined in recent years, limiting
    our ability to care for the growing needs of the people of northeast
    Georgia.  Recently, our organization made dramatic reductions,
    including the elimination of approximately 300 full time positions
    that have helped to stop that downward trend.  However, with
    projections of continued illegal immigration and the inability of
    many area citizens to obtain health insurance, keeping our health
    system operating in the black remains a challenge.
    	The Deficit Reduction Act no longer allows for self-declaration
    of citizenship, but requires verification.  This means that every
    Medicaid recipient must prove citizenship to be eligible for
    Medicaid benefits, but not to be eligible to receive emergency
    medical services.  That is a very important distinction.  The change
    in verifications only took place in July, but we are already seeing
    the impact on our operations and finances.
    	For the crux of my comments, I would like to share a true story
    of a young Latino woman, I will refer to as Maria, who came to
    our emergency room in the last month requesting dialysis.  An
    illegal immigrant from Mexico, she had come directly to
    Gainesville at the request of her mother and sister, who both
    admitted they are living in the U.S. illegally.  Mexico had
    requested upfront payment for the young woman's dialysis--funds
    which the patient did not have.  She was told that the same would
    be required in the U.S., but she decided to make the journey
    anyway because her sister had been receiving outpatient dialysis in
    the Gainesville community for the last 2 years.  Maria was
    encouraged by her sister to leave Mexico and come to Gainesville
    for care in spite of the fact that the dialysis center had informed her
    that her care would be denied and that Maria should remain in
    Mexico for treatments.  The dialysis center referenced is a private
    outpatient facility and is not owned or operated by Northeast
    Georgia Medical Center.  At the time Maria's request for service
    was made, this dialysis center had 56 patients, 11 of which were
    undocumented immigrants for whom they were receiving no
    reimbursement based on Georgia's January 2006 implementation
    of the Federal Medicaid rules which excludes Medicaid coverage
    for chronic conditions for non-U.S. citizens.
    	Maria's condition had become life-threatening by the time she
    arrived in Gainesville and presented in our emergency department
    for care.  She had to be admitted by law, also by conscience, until
    her condition could be stabilized.  Our staff worked for the next 8
    days to locate an outpatient dialysis center that would accept her
    for follow-up treatment upon her discharge from the hospital.
    They were in a tough place.  They were caring, compassionate
    people whose moral compass was spinning.  They talked with the
    distraught mother and sisters, contacted the Emory transplant
    center, the Georgia Medical Foundation, three local dialysis
    centers and the Mexican Consulate trying to find a way to secure
    dialysis treatment for this young woman who would need to be
    dialyzed on average 3 times a week indefinitely.  The hospital does
    not provide outpatient dialysis services and all local outpatient
    providers refused to accept this woman as a patient because she
    had no sources for payment that would even cover the cost of her
    treatments.
    	Maria was dialyzed six times while at our hospital, five of
    those times out of necessity while we waited to find an outpatient
    provider to accept her.  The direct cost of her care to Northeast
    Georgia Medical Center was over $9,500, which did not include
    the time expended by case managers and staff on this young
    woman's behalf.  Medicare and Medicaid generally pays about
    $200 per procedure for basic dialysis services provided on an
    outpatient basis.
    	Based on a recommendation from the Mexican Consulate and
    with a discharge plan approved by her physician, the Health
    System worked with the patient and mother to arrange for the
    patient's transport back to Mexico.  The hospital recommended
    that the patient's mother also accompany her to help coordinate the
    care needs.
    	Had Maria been discharged from the hospital without a
    resource for outpatient dialysis, she would have, most assuredly,
    returned to our emergency department or another emergency
    department within 2 to 3 days in a life-threatening condition that
    would have resulted in her emergency re-admission to the hospital.
    	The young woman's hospital care to stabilize her until she was
    safe to travel home cost our organization thousands of dollars
    which will not be reimbursed.  The story, however, is
    heartbreaking.  Similar stories could be told by staff of hospitals
    and care centers all over the country.
    	It will no doubt be a rough few years until word spreads that
    proof of citizenship will be required to receive benefits intended
    for U.S. citizens.  Years of failing to require proof of citizenship
    has meant that illegal immigrants could come to the U.S. and
    receive free care, paid for with tax dollars, better care at no
    expense, becoming a magnet to draw the chronically sick to an
    already broken healthcare funding system.
    	To tell the truth, our moral compasses are still spinning.  The
    nurses and doctors who cared for this woman will think of her
    often.  Each of us has to make personal decisions about what we
    will do to help the people of Mexico and any other Nation that is
    not as fortunate as the United States, or for that matter the poor in
    our own country.  Our Government must also make decisions
    about border control, foreign aid, trade agreements and ways to
    strengthen our ability to help our neighbors.  But the primary
    purpose of the Medicaid program has always been to provide care
    for U.S. citizens, and without these serious reforms, the system
    simply is doomed to fail.
    	I appreciate the work of this committee to keep the Medicaid
    program viable for United States citizens in need.  I respect the
    difficulty of our work and ask for your continued help in providing
    affordable healthcare for the people of our community.
    	Thank you and I stand ready to answer questions.
    	MR. DEAL.  Thank you, Mr. Gardner.
    	[Applause.]
    	MR. DEAL.  Mr. Stewart.
    	[The prepared statement of James E. Gardner, Jr. follows:]

    PREPARED STATEMENT OF JAMES E. GARDNER, JR., PRESIDENT AND
    CHIEF EXECUTIVE OFFICER, NORTHEAST GEORGIA HEALTH
    SYSTEM

            Mr. Chairman, members of the Committee, thank you for
    inviting me to be with you today.  My name is Jim Gardner, and I
    am president and chief executive officer at Northeast Georgia
    Medical Center and Health System in Gainesville, Georgia.  Very
    much like Dalton, Gainesville is a community with a large
    Hispanic population.  Gainesville's poultry and booming housing
    industry have attracted both legal, and illegal immigrants to our
    community.
        	Before I get to the crux of my comments about how illegal
    immigration affects our medical facility, let me take a moment to
    defend the hard line that I am about to take.
       	At the Medical Center, I am surrounded by people who chose
    their professions because of a genuine, sincere desire to help
    people in need.  We have a remarkable community of nurses and
    doctors who give of themselves completely and without prejudice
    to their patients.  During their hectic office hours, many of our
    community physicians volunteer to treat indigent patients through
    the Hall County Medical Society's Health Access Initiative
    without compensation.  After they have worked their more-than-
    fulltime jobs, many of our employees and physicians volunteer at
    the local Good News Clinics where free medical and dental
    services are provided for uninsured people who have no resources
    to pay for services.  We had many employees who volunteered for
    Katrina relief efforts during their families' Spring Break, and
    countless employees and physicians use personal vacation time to
    travel the world on mission trips to use their medical skills in third
    world countries.
       	I am very proud of the dedication and compassion of the
    people I work with.  I felt a need to say that, because in the current
    political climate, taking a position for any limitation on services to
    illegal immigrants is often painted with a broad brush as cruel and
    uncaring.  That would be an unfair representation of the
    organization I serve and represent today.  So I just wanted to get
    that clearly on the table before I began to address how illegal
    immigration affects our healthcare facility.
         	In Hall County, the number of Hispanics has grown from one
    percent in 1980 to just over 24 percent today, according to the
    2004 U.S.Census.  Roughly one in four people in Hall County is
    Hispanic.  To identify exactly how many illegal immigrants we
    have is very difficult.  But at Northeast Georgia Medical Center
    and in physician offices all over the region, providers must cover
    the expense of bilingual staff to care for patients, and print all
    forms and educational materials in two languages.  In 2003, a local
    study "Healthy Hall" reported that 33 percent of all Latinos are
    uninsured, which represents 60 percent of the uninsured in Hall
    County.  Uninsured patients place a huge financial burden on our
    health system and put our ability to care for the people of our
    region in jeopardy.
      	To the community, hospitals look like big business, with big
    money.  In reality, our hospital must spend over a million dollars a
    day to provide the care our community needs.  Even with our
    investment income, margins have declined in recent years, limiting
    our ability to care for the needs of the people of northeast Georgia.
    Recently, our organization made dramatic cost reductions that have
    helped stop the downward trend.  However, with projections of
    continued illegal immigration and the inability of many area
    citizens to obtain health insurance, keeping our health system
    operating in the black remains a challenge.
       	The Deficit Reduction Act no longer allows for self-declaration
    of citizenship, but requires verification.  This means that every
    Medicaid recipient must prove citizenship to be eligible for
    Medicaid benefits, but not to be eligible to receive emergency
    medical services.   The change in verification requirements only
    recently took effect July 1 but already we are seeing its impact on
    our operations and finances.
            Let me share the true story of a young Latino woman I will
    refer to as "Maria," who came to our emergency room requesting
    dialysis.  An illegal immigrant from Mexico, she had come directly
    to Gainesville at the request of her mother and sister, who both
    admitted they are living in the U.S. illegally.  Mexico had
    requested upfront payment for the young woman's dialysis - funds
    which the patient did not have.  She was told that the same would
    be required in the U.S., but she decided to make the journey
    anyway because her sister has been receiving out-patient dialysis
    in the Gainesville community for the past two years.   "Maria" was
    encouraged by her sister to leave Mexico and come to Gainesville
    for care in spite of the fact that the Dialysis Center had informed
    her that care here would be denied and that "Maria" should remain
    in Mexico for treatments.  The Dialysis Center referenced is a
    private out-patient facility that is not owned or operated by
    Northeast Georgia Medical Center.   At the time "Maria's" request
    for services was made, this dialysis center had 56 patients, 11 of
    which were undocumented immigrants for whom they were
    receiving no reimbursement based on Georgia's January 2006
    implementation of Federal Medicaid rules which excludes
    Medicaid coverage of chronic conditions for non U.S. citizens.  .
       	Maria's condition had become life-threatening by the time she
    arrived in Gainesville and presented in our emergency department
    for care.  She had to be admitted by law, but also by conscience,
    until her condition could be stabilized.  Our staff worked for the
    next eight days to locate an outpatient dialysis center that would
    accept her for follow-up treatment upon her discharge from the
    hospital.  They were in a tough place: caring, compassionate
    people whose moral compasses were spinning.  They talked with
    the distraught mother and sisters, contacted the Emory transplant
    center, The Georgia Medical Foundation, three local dialysis
    centers and the Mexican Consulate trying to find a way to secure
    dialysis treatment for this young woman who would need dialysis
    on average three times a week, indefinitely.   The hospital does not
    provide outpatient dialysis services and all local outpatient
    providers refused to accept the young woman as a patient because
    she had no sources for payment that would even cover the cost of
    her treatments.
             "Maria" was dialyzed 6 times while in our hospital-5 of
    those times out of necessity while we waited to find an outpatient
    provider to accept her.  The direct cost of her care to Northeast
    Georgia Medical Center was over $9,500, which did not include
    the time expended by case managers and other staff on this young
    woman's behalf.   Medicare and Medicaid generally pays about
    $200 per procedure for basic dialysis services provided on an
    outpatient basis.
            Based on the recommendation from the Mexican Consulate and
    with a discharge plan approved by her physician, the Health
    System worked with the patient and mother to arrange for the
    patient's transport back to Mexico.  The hospital recommended
    that the patient's mother accompany her to help coordinate the care
    she needs.
            Had "Maria" been discharged from the hospital without a
    resource for outpatient dialysis, she would have, most assuredly,
    returned to our emergency department or another nearby
    emergency department in 2-3 days in a life-threatening condition
    that would have resulted in her emergency re-admission to the
    hospital.
       	The young woman's hospital care to stabilize her until she was
    safe to travel home cost our organization thousands of dollars
    which will not be reimbursed.  The story is heartbreaking.  Similar
    stories could be told by staff of hospitals and care centers all over
    the country.
       	It will no doubt be a rough few years, until word spreads that
    proof of citizenship will be required to receive benefits intended
    for U.S. citizens.  Years of failing to require proof of citizenship
    has meant that illegal immigrants could come to the U.S. and
    receive free care, paid for through tax dollars.  Better care, at no
    expense. a magnet to draw chronically sick people to our already
    broken healthcare funding system.
       	To tell you the truth, our moral compasses are still spinning.
    The nurses and doctors who cared for this young woman will think
    of her often.  Each of us must make personal decisions about what
    we will do to help the people of Mexico and any other nation that
    is not as fortunate as the United States and for that matter the poor
    in our own country.  Our government must also make decisions
    about border control, foreign aid, trade agreements and ways to
    strengthen our ability to help our neighbors.  But the primary
    purpose of the Medicaid program has always been to provide care
    for U.S. citizens, and without these serious reforms, the system
    simply is doomed to fail.
         The verification component of the deficit reduction act will only
    work if healthcare providers enforce the law, even though
    enforcement will often require tough actions.
         I appreciate the work of this committee to keep the Medicaid
    program viable for United States citizens in need.  I respect the
    difficulty of your work and ask for your continued help in
    providing affordable healthcare for the people of our community.
    Thank you.

    	MR. STEWART.  Good morning, Mr. Chairman and members of
    the committee.  My colleague Mr. Gardner spoke of the impact of
    illegal aliens on the Gainesville community and I am very pleased
    to be here today to discuss the impact that illegal immigration is
    having on the Medicaid program and our health delivery system as
    a whole.  I also wish to thank you, Chairman Deal, members of the
    committee, members of the Georgia legislature, and others for
    taking time to come to Dalton to address this important issue.
    	Since 1953, Hutcheson Medical Center has been northwest
    Georgia's community hospital.  We are a 300-bed healthcare
    system with a commitment to provide access to quality, cost-
    effective healthcare to our growing population.
    	Being one of the largest community hospitals in Georgia,
    Hutcheson Medical Center has over 1,300 employees with more
    than 200 physicians and over 400 registered nurses and clinical
    staff.  Our primary service area includes Catoosa, Dade, and
    Walker Counties with more than 137,000 residents.
    	Let me begin by saying that I share the committee's concern
    about the Nation's need to secure our borders.  As you are aware,
    undocumented aliens' use of medical services had been a
    longstanding issue for hospitals.  As required by Federal law--the
    Emergency Medical Treatment and Labor Act or EMTALA--
    hospitals participating in Medicare must provide emergency
    medical services for all patients who seek care, regardless of their
    ability to pay.  Under EMTALA, hospitals must provide an
    appropriate medical screening examination for individuals who
    seek emergency care in a hospital emergency department.
    	If an individual is found to have an emergency medical
    condition, the hospital must treat and stabilize the medical
    condition, or transfer the patient under certain circumstances.
    Additionally, if an individual's medical condition is not stable, the
    hospital may not transfer him or her unless the individual or
    someone acting on their behalf, requests the transfer, and the
    transfer is appropriate under EMTALA.  Since hospitals are
    required to evaluate and treat all patients who seek care in hospital
    emergency departments, EMTALA, in effect, requires hospitals to
    provide free care for some patients, regardless of their condition or
    their citizenship status.  This raises the concern that while we are
    treating the illegal immigrant population, how many Georgia
    citizens are not getting the quality treatment they require?
    	As Congressman Deal pointed out earlier, it costs
    approximately $340 to care for a non-emergency patient in the
    emergency department while it costs less than $75 to care for the
    same patient in a clinic.  That means that over four people can be
    treated in a clinic for less money than one person can be seen in the
    emergency department.  And, according to the Georgia Department
    of Community Health, 41.3 percent of ER visits were for non-
    emergencies on Mondays through Fridays from 8:00 a.m. until
    5:00 p.m., which is when most physician offices and clinics are
    open.  At Hutcheson Medical Center, we have seen our
    uncompensated care increase by a million and a half dollars just in
    this fiscal year alone.
    	Another issue the hospitals face in emergency departments is
    the growing number of births to illegal aliens.  It is documented
    that in some States, more than half of emergency Medicaid
    expenditures were for labor and delivery services.  Our current law
    provides that babies who are born on U.S. soil to illegal
    immigrants are to become immediately recognized as citizens; and
    thereby ultimately drive up the cost of healthcare, especially in
    those States with the highest estimated illegal populations, of
    which Georgia is a part.  The question arises, how long are
    providers obligated to care for these newborns?
    	Additionally, there is concern that Title II, Sections 201 and
    202 of H.R. 4437, if enacted, will place hospitals and caregivers at
    risk for violating provisions of the Immigration and Nationality
    Act.  While I believe that it is not the intent of Congress to
    criminalize providers who are just trying to provide quality care to
    their patients, some of the language is broadly worded, and at the
    very least, creates a Catch 22 for hospitals and providers that seek
    reimbursement under Section 1011 of the Medicare Modernization
    Act.  In order to receive reimbursement, they must acknowledge
    that they have rendered treatment to an individual who is an
    undocumented alien.
    	Thank you again for giving me the opportunity to comment on
    this very important issue.  I appreciate all of your service to our
    country and our State, and I am available for questions as well.
    	MR. DEAL.  Thank you.  Dr. Michaels.
    	[The prepared statement of Charles Stewart follows:]

    PREPARED STATEMENT OF CHARLES STEWART, CHIEF EXECUTIVE
    OFFICER, HUTCHESON MEDICAL CENTER

            Good Morning, Mr. Chairman and members of the committee,
    my name is Charles Stewart and I am the Chief Executive Officer
    of the Hutcheson Medical Center in Ft.  Oglethorpe, Georgia.  I am
    very pleased to be here today to discuss the impact that illegal
    immigration has on the Medicaid program and our health delivery
    system as a whole.  I also wish to thank you, Chairman Deal,
    members of the Committee, members of the Georgia Legislature,
    and other witnesses for taking the time to come to Dalton to
    address this important issue.
            Since 1953, Hutcheson Medical Center has been Northwest
    Georgia's community hospital.  We are a 300-bed health care
    system with a commitment to provide access to quality, cost
    effective healthcare to our growing population.
            Being one of the largest community hospitals in Georgia,
    Hutcheson Medical Center has over 1300 employees, with more
    than 270 physicians and over 400 registered nurses and clinical
    staff.  Our primary service area includes Catoosa, Dade and
    Walker counties with more than 137,000 residents.
            Let me begin by saying that I share the committee's concerns
    about the nation's need to secure its penetrable borders.  As you
    are aware, undocumented aliens' use of medical services has been
    a longstanding issue for hospitals.  As required by federal law - the
    Emergency Medical Treatment and Labor Act (EMTALA) -
    hospitals participating in Medicare must provide emergency
    medical services for all patients who seek care, regardless of their
    ability to pay.  Under EMTALA, hospitals must provide an
    appropriate medical screening examination for individuals who
    seek emergency care in a hospital emergency department.
            If an individual is found to have an emergency medical
    condition, the hospital must treat and stabilize the medical
    condition, or transfer the patient under certain circumstances.
    Additionally, if an individual's medical condition is not stable, the
    hospital may not transfer him or her unless the individual, or
    someone acting on their behalf, requests the transfer, and the
    transfer is appropriate under EMTALA.  Since hospitals are
    required to evaluate and treat all patients who seek care in hospital
    emergency departments, EMTALA in effect requires hospitals to
    provide free care for some patients regardless of their condition or
    their citizenship status.  This raises the concern that while we are
    treating the illegal immigrant population, how many Georgia
    citizens are not getting the quality treatment they require?
            Meanwhile, it costs approximately $340 to care for a non-
    emergency patient in the emergency department while it costs less
    than $75 to care for the same patient in a clinic.  That means over
    four people can be treated in a clinic for less money than one
    person can be seen in the emergency department.  And, according
    to the Georgia Department of Community Health, 41.3% of ER
    visits were for non-emergencies on Mondays through Fridays from
    8:00 a.m. until 5:00 p.m., which is when most physician offices
    and clinics are open.
            Another issue that hospitals face in emergency departments is
    the growing number of births to illegal aliens.  It is documented
    that in some states, more than half of emergency Medicaid
    expenditures were for labor and delivery services.  Our current law
    provides that babies who are born on U.S. soil to illegal
    immigrants are to become immediately recognized as citizens; and,
    thereby ultimately drive up the cost of healthcare, especially in
    those states with the highest estimated illegal populations of which
    Georgia is a part.  The question arises how long are providers
    obligated to care for these newborns?
            Additionally, there is a concern that Title II, Sections 201 and
    202 of H.R.  4437, if enacted, will place hospitals and caregivers at
    risk for violating provisions of the Immigration and Nationality
    Act (INA).  While I believe that it is not the intent of Congress to
    criminalize providers who are just trying to provide quality care to
    their patients, some of the language is broadly worded, and at the
    very least, creates a "Catch 22" for hospitals and providers that
    seek reimbursement under section 1011 of the Medicare
    Modernization Act: in order to receive reimbursement, they must
    acknowledge that they have rendered treatment to an individual
    who is an undocumented alien.
            Thank you, again, for giving me the opportunity to comment
    on this very important topic.  I appreciate your service to our great
    Country and State, and am happy to answer any questions you or
    members of the Committee may have.

    	MR. MICHAELS.  Thank you, Mr. Chairman.  Stop me if I am
    not supposed to do this, but I would like to thank the Congressmen
    and Congresswoman on the panel, Chairperson Deal, I would like
    to thank you personally for the time that you have taken in talking
    with me over the last year about children's healthcare issues and,
    Mr. Clark, I would like to thank you for the same.  I have felt that I
    was listened to and I do feel that you are attuned to the important
    needs of children and I thank you for that and your leadership.
    	MR. DEAL.  You can say that a long time.  Thank you.
    	[Laughter.]
    	MR. MICHAELS.  Congressman Norwood, I would like to thank
    you for your support on position issues with Steadfast, and I am
    glad to see that you are looking very well.
    	And Congresswoman Solis, I appreciate your advocacy for
    children, especially children of low-income families.  So thank you
    for that.
    	I will be speaking today from my notes.  This testimony is filed
    by the American Academy of Pediatrics.  I will not be reading
    from this but this needs to be part of the official record because
    this states the official position of the American Academy of
    Pediatrics.
    	MR. DEAL.  Without objection, that will be made part of the
    record.
    	MR. MICHAELS.  Thank you, sir.
    	And my comments generally do reflect the opinion of the
    American Academy of Pediatrics, but there will be some personal
    comments that have not been discussed by the American Academy
    of Pediatrics, so this should not be construed as the official
    position of the American Academy.
    	My name is Martin Michaels, I am a primary care pediatrician.
    I am President of the Georgia Chapter of the American Academy
    of Pediatrics and I am the founding partner of Peachcare P.C.,
    which is medium-sized general pediatric practice in Dalton,
    Georgia.  I am grateful for the opportunity to testify to the Health
    Subcommittee today in Dalton.
    	I will be focusing my comments on the impact of illegal
    immigration on the Medicaid Program and our healthcare delivery
    system, as it relates to the healthcare and the health status of
    children of illegal immigrants who live in the United States.
    	The definition for children for me is ages 0 to 18 years, for
    today's discussion.
    	A little bit about my practice and experience, I am a
    pediatrician who has practiced in northwest Georgia since 1984.
    When I began in practice, I had a lot more hair and the percent of
    children covered by Medicaid at that time in my practice was about
    20 percent, and there was no SCHIP program at that time.  There
    were very few immigrants in Dalton at that time.  There was a
    large group of uninsured children and under-insured children and a
    minority of the children in my practice had a true medical home.
    	Early in my career, I saw first-hand the suboptimal outcomes
    and complications occurring because of the lack of medical home
    for a large number of children and the large majority of these
    children were Caucasian children, I had very few foreign born
    children in my practice at that time.
    	In our practice, we place a strong emphasis on providing a
    medical home for all our patients.  A medical home is a place
    where the patient and family are known by the providers, where
    the families have a trusting relationship with the providers and
    comprehensive preventive and acute care is available in a timely
    and continuous way.  A permanent, complete, ongoing medical
    record exists in the medical home.  Parents preferentially seek care
    in their medical home rather than the ER for many reasons.
    	My practice accepts all children without regard for ability to
    pay.  We have never used a collection agency and we never will.
    If a family calls and says they have good insurance or bad
    insurance, Medicaid, Peachcare or no insurance and no money, we
    will still see the child.
    	When looking at the issue of healthcare for children of
    immigrants, illegal and legal, it is important to remember that we
    are talking about individual families and individual children.  This
    is not a faceless mass from any one country.  I have seen
    immigrants in Dalton from every continent of the world except for
    Antarctica.  Within the primarily Spanish speaking population in
    Dalton, there is huge diversity.  There are families from South
    America, Central America, Mexico, and Cuba.  Each of these
    families is unique and different, just as each white and African-
    American family is unique and different.
    	I want to talk a little bit about focusing on children.  I am sure
    that no one on any of these panels, the three panels that have
    spoken, the panel of Congressmen and women, the folks in the
    audience--I do not think that anybody here wants to intentionally
    or unintentionally hurt children.  I think either we have children,
    we have grandchildren, we have friends that have children, nieces,
    nephews--none of us wants to intentionally or unintentionally hurt
    a child.
    	Remember that children do not have a choice in what we are
    talking about today.  They are innocent of wrongdoing and they
    find their healthcare availability subject to decisions made by
    adults, adult legislators, adult employers, and adult parents.  Adult
    legislators make decisions about immigration policies, border
    entry, regulation, level of enforcement of policies in the interior of
    the Nation, in the workplace and in the community.  Adult
    immigrants make decisions about whether to bend or break the
    rules.  Adult employers make decisions about whether to bend or
    break the rules.
    	As a pediatrician, I have witnessed first-hand complications
    that occur when primary healthcare is not accessible to children,
    and it is my position that all children who reside in the United
    States should have equal access to quality healthcare directed by a
    medical home.  This includes children of documented immigrants,
    some of whom were born in other countries and some who were
    born in the United States, and children of undocumented
    immigrants, some who were born in other countries and some who
    were born in the United States.  Foster children, newborns,
    children affected by disasters such as Hurricane Katrina, Native
    American Indian children, all must have immediate presumptive
    eligibility upon application to avoid disastrous and expensive
    health outcomes due to lack of access to appropriate primary care.
    	I will say as a sidebar, one of the panelists mentioned that State
    agencies have more information than anyone else about foster
    children.  But just to give you an example from the front lines,
    when a foster child comes to my office for the first time, I do not
    have immunization records, I do not know if that child is allergic
    to anything, I do not know if that child has seen a specialist, I have
    pretty much zilch.  And it is a big problem.  We are working on it
    in Georgia, the officials in Georgia are aware of this, it is not that it
    has not been talked about, but it has not gotten better.  We have
    been talking about that for years.  So if we think that they are
    going to be able to figure out documentation for eligibility in a
    time efficient way, I would predict not.  And I do not mean that in
    an ugly way, I just mean that in a practical way.
    	Also, any policies about documentation of citizenship must
    take into account the healthcare literacy level of the population
    served and must be geared at a low enough educational level that
    the clients can reasonably carry out the requirements of the policy.
    I have not heard anybody say anything about healthcare literacy
    today, but that is a term in the literature and you need to look at
    examples of different levels of healthcare literacy, what it takes to
    figure out a Social Security card, what it takes to get a birth
    certificate.  These are levels of functioning that may be above the
    levels of many of the parents that I see.
    	When children do not have access to medical homes, the
    resulting costs are human health costs and suffering for the
    immigrant child, adverse health consequences for the community,
    not just for the child, but contractible diseases that the community
    is exposed to because of lack of primary care for the immigrant
    child, increased unreimbursed costs for hospitals and for
    physicians and other providers, increased taxes and increased
    healthcare premiums for the community because care outside of
    the medical home is very expensive.
    	I want to make a comment about virtual barriers to care.
    Virtual barriers to care must be avoided.  These are roadblocks
    whose intent is to make it more difficult to get care to which an
    individual is otherwise legally entitled.  Setting up virtual barriers
    to care for children is becoming rampant in my experience in our
    healthcare system and it is unethical.  Requiring the parents of a
    newborn or foster child to bring in a birth certificate before they
    can get Medicaid benefits is a virtual barrier to care and one that
    will result in expensive medical complications and ER visits.
    	I want to talk a little bit about spending our limited healthcare
    dollars, and Mr. Deal and Mr. Clark, you and I have talked about
    this.  I think you know that I understand it is not a bottomless pit of
    dollars that we have to spend, I understand that very clearly and I
    have made individual efforts to learn about that and how to cut
    those costs in a good way.  There are economic, moral, and ethical
    aspects to how we spend our healthcare dollars.  Our healthcare
    dollars are limited, they are precious, they must be used wisely and
    not wasted.
    	Children are not breaking the bank of Medicaid nationally or in
    Georgia.  Seventy percent of the recipients of Medicaid are
    children, but they only account nationally for 30 percent of the
    cost.  And in Georgia, that break is even bigger, as I understand it.
    	The other specific I want to share from Georgia is that between
    2000 and 2005, the cost of Medicaid and SCHIP for Georgia,
    combined State and Federal expenditures, increased from $3.5
    billion in 2000 to $6.5 billion in 2005.  That is an alarming looking
    number.  But it is very important to remember that the number of
    enrollees went from 970,000 in 2000 to 1.5 million in 2005, there
    was an increase of 150 percent in the number of enrollees.
    	And Mr. Norwood, just to go back to the comment about
    Georgia being a deficit State for Peachcare, I think it would be
    important to look and see if the deficit is really there in terms of
    members served per--amount paid per member per year.  Because I
    suspect that what happened there is we had such a huge increase in
    enrollment, and that was due to the leadership of the Department of
    Community Health in doing a great job of enrolling kids.  Georgia
    back in 2000-2001 was the poster state for the SCHIP program, we
    were doing great.  And I think Deanna Key at that time, who was
    the membership person at DCH, did an outstanding job and got
    kids signed up quickly that were eligible, and therefore, Georgia
    spent more money.  But I think it is real important to look at the
    per member per year cost to make sure we are really a deficit state.
    I think other States received more money than they were supposed
    to and did not sign up as many kids, and I think they owe us some
    back, is the way I understand it.  I may be wrong on that, but I
    think that is correct.
    	And in summary of that, I want to say that the increased per
    member per year in Georgia for kids between 2000 and 2005, per
    member per year, was 2.5 percent.  The inflation rate I believe
    between 2000 and 2005 averaged over 2.5 percent and I know of
    no other healthcare system that did not increase faster than the rate
    of inflation.  If there is, I would like for somebody to tell me where
    that was.
    	So Georgia had a very successful, in my opinion, healthcare
    expenditure during those 5 years.  Why?  Because all those
    children in the Georgia program were assigned to a medical home.
    That is my opinion about why that increase was so low, and it was
    called Georgia Better Healthcare, it was a primary care case
    management system and kids could not be in the system without a
    primary care provider.
    	Creating barriers to access to care for children is neither moral
    or ethical.  It will not save significant healthcare dollars.  It will
    adversely affect the health of children who do not have access to
    care.  It will adversely affect the health of our Dalton, Whitfield,
    Murray communities.  It will adversely affect our State's vital
    statistics.  I am really sorry to say, Mr. Norwood and Mr. Deal, that
    our infant mortality rates and our neonatal mortality rates in
    Georgia are among the lowest in the country.  We are number 44
    and number 45 out of 50 States in neonatal mortality and infant
    mortality.  And I am not saying that in an accusatory way, I am
    saying that we need to do something about that.  The doctors have
    talked about that for many years, it is something that needs to
    improve.  A lot of it has to do with socio-economic factors, but the
    fact is not providing access to care for legal or illegal immigrants
    will put us down from 45, we may end up below Alabama and
    Mississippi, States that are at the bottom of the list.
    	To make things a little bit more upbeat, our immunization rate
    in Georgia is actually number four in the country, we are fourth in
    the country in fully immunized 3-year olds.  Why?  Because our
    Vaccine for Children program in Georgia covers uninsured and
    under-insured children.  If we do not continue access to care for
    immigrants, illegal, legal, if we make those barriers to care there,
    our immunization rate is going to plummet and I think when
    industries look to see what State they want to locate in, they look at
    healthcare indicators and for children, in my experience,
    immunization rates, neonatal mortality, infant mortality are three
    top indicators that people look at.
    	MR. DEAL.  Dr. Michaels, would you summarize for us, please,
    sir?
    	MR. MICHAELS.  Yes, sir.  How to save healthcare dollars.
    Wasting healthcare dollars is immoral.  The right way to save
    money in the healthcare system is to study utilization and
    outcomes and how these two are linked.  We must have excellent
    outcomes for all children, we must find the most cost-effective
    way to reach those outcomes, identify best practices, and then
    require mandatory non-onerous, non-punitive review of profiling
    in practice patterns by practicing providers and require mandatory
    non-punitive education about cost-effective ways to achieve the
    best outcomes.  This type of model could be called PFE, Pay for
    Education, and it can be implemented in a more fair way than Pay
    for Performance.
    	Medical homes save healthcare dollars.  All children residing
    in the United States should receive care in a medical home.
    Practical examples, to minimize ER visits.  Our practice, which is a
    medical home, pays $24,000 a year for a 24-hour telephone triage
    system, so our patients do not go to the ER before they call that
    number.  They go through a very safe protocol which is handled
    over the phone by a registered nurse.  And if they are told to go to
    the ER, they go.  If they are told to give Tylenol and see us in the
    morning, they do that.  Our low-income families abide by those
    suggestions.  And that is a suggestion I have about EMTALA.  I
    would suggest the Federal government figure out a way to require
    telephone triage of children through a safe pediatric telephone
    triage system such as that of Dr. Barton Schmidt in Colorado.
    	In summary, the recommendations of the American Academy
    of Pediatrics--and this will just take 45 seconds I think to sum up.
    Our mission statement is to attain optimal physical, mental, and
    social health and well being for all infants, children, adolescents,
    and young adults.  Thereby, the official recommendations of the
    American Academy of Pediatrics are that CMS should confirm
    with the States that newborns are considered eligible for Medicaid
    coverage.
    	Paperwork should not delay payment for services provided to
    newborns.  Eligibility for newborns should be presumptive.
    	The deemed sponsor rule should be changed so that immigrant
    children are not denied access to insurance and, by extension,
    quality healthcare.
    	Community resources should be pooled to address unpaid care
    provided by pediatricians to immigrant children.
    	Outreach efforts to enroll children who do qualify for Medicaid
    and SCHIP but who are not currently enrolled should be expanded.
    	Payment policies should encourage the establishment of a
    medical home for all children residing in the United States.  The
    medical home, since it saves dollars in decreased referrals, ER use,
    and hospitalization, should be recognized as a scorable element in
    the healthcare budget process.  And a case management fee is one
    mechanism to have a payment policy that will encourage the
    establishment of a medical home.
    	Finally in 15 seconds, the Marty Michaels recommendations
    which are not the official position of the American Academy of
    Pediatrics are:
    	That all children residing in the United States should have a
    medical home.
    	Cost savings should be achieved by finding ways to spend
    healthcare dollars effectively through improved utilization and
    outcomes derived from a Pay for Education model.
    	And lastly, policies regarding documentation of citizenship
    should not create virtual barriers to healthcare for children.
    	Thank you to the Committee and the community for listening;
    thank you all in advance for working proactively to develop
    policies that ensure that all children residing in the United States
    have a medical home and access to needed preventive and acute
    healthcare.  Together we can provide appropriate care for all
    children residing in the United States while preserving precious
    United States healthcare dollars.
    	[Applause.]
    	[The prepared statement of Marty Michaels follows:]

    PREPARED STATEMENT OF DR. MARTY MICHAELS, CHAIR,
    GEORGIA CHAPTER, AMERICAN ACADEMY OF PEDIATRICS

            The American Academy of Pediatrics (AAP) is an organization
    of 60,000 primary care pediatricians, pediatric medical
    subspecialists, and pediatric surgical specialists, who are deeply
    committed to protecting the health of children, adolescents and
    young adults in the United States.  Our testimony in today's
    Hearing, "Examining the Impact of Illegal Immigration on the
    Medicaid Program and Our Healthcare Delivery System," will
    focus on children, the innocent victims of illegal immigration.
            Children, whether they are undocumented or not, need care in
    our communities.  Most immigrant children's care should be
    preventive, but too often, that care is foregone.  Comprehensive,
    coordinated, and continuous health services provided within a
    medical home should be integral to all efforts on behalf of
    immigrant children.  Children need and deserve access to care, and
    communities benefit when they receive it.
            Unfortunately, immigrant children often do not receive the care
    they need because of federal, state and local laws limiting payment
    for their care, or a generalized belief that if children seek care, their
    families or loved ones may become the target of law enforcement.
            AAP believes that barriers to access, such as the recent
    promulgation of rules by the Centers for Medicare and Medicaid
    Services requiring Medicaid recipients to document citizenship and
    identification, will harm the health of the children in our country
    and the communities they live in.

    Immigrant Children
            One in every five American children is a member of an
    immigrant family.  About one-third of the nation's low-income,
    uninsured children live in immigrant families.  Children of
    immigrants, often racial or ethnic minorities, experience significant
    health disparities.  These disparities arise because of complex and
    often poorly understood factors, many of which are worsened by
    the circumstances of their lives.  Although these children have
    similar challenges with regard to poverty, housing, and food,
    significant physical, mental, and social health issues may exist that
    are unique to each individual child.
            Children of immigrants are more likely to be uninsured and
    less likely to gain access to health care services than children in
    native families.  Socioeconomic, financial, geographic, linguistic,
    legal, cultural, and medical barriers often limit these families from
    accessing even basic health care services.  Once care is available,
    communication barriers often result in immigrant children
    receiving lower-quality services.  Many immigrant families also
    have varied immigration statuses that confer different legal rights
    and affect the extent to which these families are eligible for public
    programs such as SCHIP, the State Children's Health Insurance
    Program, and Medicaid.  Thus, the immigration status of children
    in the same family may differ.  As a result, a foreign-born child
    may be ineligible for insurance coverage, while his or her younger,
    U.S.-born sibling is eligible as a native citizen.
            Each immigrant's experience is unique and complex but certain
    overarching health issues are common in caring for immigrant
    families.  Immigration imposes unique stresses on children and
    families, including:
     depression, grief, or anxiety associated with migration and
    acculturation;
     separation from support systems;
     inadequate language skills in a society that is not tolerant of
    linguistic differences;
     disparities in social, professional, and economic status
    between the country of origin and the United States; and
     traumatic events, such as war or persecution, that may have
    occurred in their native country.

            The health of immigrant children not only impacts the child, it
    impacts the entire community.  Preventive care commonly
    provided to children born in the United States will often not be
    available to children of immigrants.  Left untreated, the health
    issues caused by this lack of prevention cause immigrant families
    to seek care for their children in emergency settings.  Children
    commonly present with worse health status in the emergency room
    than if they had received preventive care.
            Beyond the health status of the child, communities should also
    care about the health of the children who live in them because
    immigrant children may have diseases that are rarely diagnosed in
    the United States.  Left untreated, these diseases may be passed on
    to the communities in which immigrant children reside.  In
    addition, many foreign-born children have not been immunized
    adequately or lack documents verifying their immunization status.
    Dental problems are also common among immigrant children.
            The measles vaccine is an example of the importance of
    prevention for communities.  Measles is a highly infectious viral
    disease that can cause a rash, fever, diarrhea and, in severe cases,
    pneumonia, encephalitis and even death.  Worldwide, it infects
    some 30 million people and causes more than 450,000 deaths a
    year.  In the United States, measles was once a common childhood
    disease, but it had been largely eliminated by 2000.  Nevertheless,
    an outbreak of measles occurred in Indiana last year.  A 17-year-
    old unvaccinated girl who visited an orphanage in Romania on a
    church mission picked up the virus there.
            When the girl returned, she attended a gathering of some 500
    church members that included many other unvaccinated children.
    By the time the outbreak had run its course, 34 people had become
    ill.  Three were hospitalized, including one with life-threatening
    complications.  Clearly, communities should care about the health
    of those who reside in them.

    Federal and State Health Programs for Immigrants
            One of the most important risk factors for lack of health
    coverage is a child's family immigration status.  Some children in
    the United States are ineligible for Medicaid and SCHIP because
    of immigrant eligibility restrictions.  Many others are eligible but
    not enrolled because their families encounter language barriers to
    enrollment, are confused about program rules and eligibility status,
    or are worried about repercussions if they use public benefits.
            The vast majority of immigrant children meet the income
    requirements for eligibility for Medicaid or the State Children's
    Health Insurance Program (SCHIP), but for various reasons are not
    enrolled.  Medicaid and SCHIP are not available to most
    immigrant children because of eligibility restrictions imposed by
    various federal laws.  Two examples include the sponsor deeming
    rule and the recently promulgated citizenship and identification
    documentation requirements.
            While qualified immigrants can become eligible to receive
    federal benefits after five years of U.S. residency, secondary rules
    often interfere with their access to benefits, such as the "sponsor
    deeming" rule.  Current law requires that people who immigrate
    through family "sponsors" may have their sponsors' income
    counted in determining eligibility.  This rule applies even if the
    sponsor lives in a separate household and does not actually
    contribute to the immigrant's financial support.  Sponsor deeming
    has made a majority of low-income immigrants ineligible for
    benefits, even after five years have passed.  Moreover, if an
    immigrant uses certain benefits, including Medicaid and SCHIP,
    his or her sponsor can be required to repay the government for the
    value of the benefits used until the immigrant becomes a citizen or
    has had approximately 10 years of employment in the United
    States.  Together, these requirements impose significant barriers to
    securing health coverage, even when immigrant children are
    otherwise eligible.
            Immigrant children who used to qualify based on certifications
    as to their immigrant status now may not qualify because of
    changes contained in the Deficit Reduction Act.  These changes
    require that Medicaid applicants, who would otherwise qualify,
    must now also provide documentation such as a passport or
    original birth certificate to verify their citizenship status and
    identity.  While designed to weed out fraud and abuse from the
    system, AAP has already received information that the rule has
    limited access to care for poor children who would otherwise
    qualify for Medicaid.  An extreme example of this can be found in
    new rules denying coverage for children born in the United States
    to undocumented mothers.
            According to these new rules, newborns may not be eligible for
    Medicaid until strenuous documentation requirements have been
    satisfied.  Hospital records may not be used in most cases to prove
    that children are citizens, even though the child was born in the
    hospital providing care and are, by definition, citizens.  Thus, care
    for some citizen newborns may not be paid for by Medicaid
    because paperwork documenting their status is not yet available.
    Pediatricians treating these citizen newborns whether they are low-
    birthweight, have post-partum complications, or simply need well-
    baby care, may not be paid.  This result is completely unnecessary
    because the child will eventually qualify for Medicaid benefits as a
    result of where he or she was born.

    Recommendations
            Lawmakers should be aware of and sensitive to the onerous
    financial, educational, geographic, linguistic, and cultural barriers
    that interfere with achieving optimal health status for immigrant
    children.  This awareness should translate into:
     CMS confirming with states that newborns are presumed
    eligible for Medicaid coverage.  Paperwork should not
    delay payment for services provided to resident newborns.
     The deemed sponsor rule should be changed so that
    immigrant children are not denied access to insurance, and
    by extension, quality health care.
     The pooling of community resources to address unpaid-for
    care provided by pediatricians to immigrant children.
    Undocumented children receive care from pediatricians.
    Communities benefit from the provision of this care.
    Communities should not expect pediatricians alone to
    provide the resources needed to furnish this care.
     Encouraging payment policies to support the establishment
    of a medical home for all children residing in the United
    States.  Comprehensive, coordinated, and continuous health
    services provided within a medical home should be integral
    to all efforts on behalf of immigrant children.  In addition,
    the establishment of a medical home should be a "scorable
    element" for children, as the medical home will have the
    effect of providing care for children away from the
    emergency room in many instances.
     Outreach efforts for children who are potentially eligible for
    Medicaid and SCHIP but not enrolled, simplified
    enrollment for both programs, and state funding for those
    who are not eligible for Medicaid or SCHIP.  The Medicaid
    reciprocity model, which allows Medicaid recipients in one
    state to qualify for services in another state without
    reestablishing eligibility, is an example of a model that
    enables underserved families to access health benefits more
    easily.

            In closing, the American Academy of Pediatrics seeks to
    ensure that Congress keeps in mind the children we care for as it
    considers restructuring immigration law.  Pediatricians and a host
    of other health professionals provide care to children throughout
    the United States.  We must not compromise children's health in
    the name of reform.

    	MR. DEAL.  Thank you, thank you all.
    	My observation is that all three of you have established the
    primary reason why we should secure our borders.  And that is,
    you are having to deal with the effects of our not doing so.  And
    Dr. Michaels, certainly the empathy that you display for your
    patients and for children in general is exemplary.
    	But we should not be putting you in that position and we
    should not be putting the hospitals in the position of having to
    determine whether somebody is legal, illegal, et cetera.  The
    security of our border will go a long way toward relieving that
    burden that is being placed on you.
    	And since we have come so close to other legislative issues
    that are not really the thrust of this hearing, let me mention a few.
    You mentioned about immunization records.  Hopefully, the
    Health IT bill that we have all worked on, and hopefully we will
    see finalized, will go a long way toward providing that seamless
    flow of information.  And the other general category that is not
    directly involved here and that is a bill that I am the sponsor of of
    terminating birthright citizenship because that--
    	[Applause.]
    	MR. DEAL.  --is part of the reason that many of these
    expenditures that you are talking about actually come about.  The
    case of Maria is an example of just the lack of security at the
    border and you are put in a very delicate and difficult position, are
    you not, Mr. Gardner?
    	MR. GARDNER.  Absolutely.  And I think the challenge for
    healthcare folks--and you touched on it, Congressman Deal, is that
    this is not the business that we got into.  It is about taking care of
    patients.  And to have that very difficult choice of literally
    sometimes losing tens or hundreds of thousands of dollars,
    depending on what the case is trying to do the right thing versus
    the practicality of--for every $50,000 that the hospital loses, it
    translates into one full time job that has to be eliminated.  And that
    is the balance that goes on every day.
    	MR. DEAL.  Well, you alluded to some other things too, and
    that is the cost factor of those who present themselves in your
    emergency rooms and I think Mr. Stewart also alluded to the
    EMTALA law.  I know Dr. Norwood and I have both been very
    conscious of the fact that we need to revisit that to try to give you
    some relief.  We tried to build in some provisions in the Deficit
    Reduction Act that would give you some liability protections for
    making decisions to defer from your ERs to alternative sites.
    Unfortunately some of that language did not survive, but it is a
    constant concern.
    	The other thing is when you have someone who presents
    themselves in your hospital, whether it be through ER or in other
    methods of presentation, and they do not have any insurance and
    they do not have, or say they do not have the ability to pay out of
    their pocket for the cost of their care; am I not correct that what
    that does is it drives up the cost of care for other people, either
    those who have insurance, because you have to reflect that in the
    charges that you make, and insurance companies have to reflect
    that in their premiums, or it is reflected to the general population in
    some form or fashion for those who are fortunate enough to get
    subsidized assistance for indigent care, and I know that not all of
    you have that ability to get that money.  But does it not just shift
    this cost?
    	MR. GARDNER.  You know, without question, there is actually
    an explicit tax, I would argue, on top of all insurance premiums,
    whatever the true cost of insurance would be, and I cannot estimate
    that exact premium to you.  But you know, for instance if you just
    take a look at Northeast Georgia Medical Center, our bad debt this
    year is going to be approximately $30 million on a budget of about
    $400 million.  So that has to come from somewhere, that $30
    million is transferred somewhere else in the system in terms of
    increased rates.  And in fairness to the insurance companies they
    have to be able to remain solvent also.
    	So ultimately it is passed back to those of us that have health
    insurance.
    	MR. DEAL.  And it is a Catch 22 because as they pass those
    costs back, it raises the cost of insurance and, therefore, you have
    more people who cannot afford to buy that insurance and more
    who fall into the uninsured category.
    	MR. GARDNER.  There is the dilemma.
    	MR. DEAL.  One quick last question, and you may not have the
    information, but I would like to ask it.  Do either of you hospital
    administrators have any information as to the number of children
    born in your facilities that were born to parents who are illegally in
    our country?
    	MR. STEWART.  I do not know that we have that information
    available.
    	MR. GARDNER.  We do not have that information available
    either.  But I can tell you we did 4,200 deliveries last year and it is
    reflective of our community in terms of the numbers of individuals
    to various demographic factors of our community.
    	MR. DEAL.  Thank you.  Ms. Solis.
    	MS. SOLIS.  Yes, I just wanted to make a brief comment.  Mr.
    Gardner, you said that your individual that you pointed out, Maria,
    had six dialysis treatments totaling $9,500.  That is about $1583
    per treatment.  But you also are saying that Medicare and Medicaid
    only pays to reimburse for $200 for treatment.  So is Medicare
    underpaying the dialysis by $1300?
    	MR. GARDNER.  I do not know that I can address that.
    	MS. SOLIS.  Or are you overcharging the uninsured women
    then?
    	MR. GARDNER.  No, this lady had a very--
    	MS. SOLIS.  Thank you.
    	MR. GARDNER.  --she had a very complicated stay within the
    ICU for about 8 days.  Slightly more expensive than a dialysis
    treatment.
    	MS. SOLIS.  Thank you.  Mr. Michaels, I really appreciate the
    fact that you came and were very objective and honest about what
    your services are.  And with respect to the SCHIP program, I know
    in the State of California and many cases in other States, we turn
    back money, we have not really fully utilized and really done a
    good job as the State of Georgia has.  So I commend the State of
    Georgia and obviously your work for doing that.  Perhaps there is a
    way we could negotiate through the Congress so that States like
    yours that are actually on the increase because you have a higher
    number of uninsured that are now--
    	MR. MICHAELS.  We would go for that.
    	MS. SOLIS.  --we can work on that.  That is something that I
    would agree with.  I mean children need to be covered.
    	And I wanted to ask you what the costs are for a child that does
    not receive say prenatal healthcare and what additional costs would
    be assumed by the State if prenatal care were denied for children
    who were born here but parents were undocumented?
    	MR. MICHAELS.  Yeah.  Well, the cost of neonatal ICU is one
    of the most exorbitant in pediatrics and if you look at the private
    sector, HMOs, when they do not make money, one of the big
    reasons they do not is they had higher than anticipated neonatal
    ICU charges for that quarter.  So the big risk with lack of prenatal
    care is complications that lead to prolonged ICU stays for
    newborns--extreme prematurity, you can have a baby born 25-26
    weeks, that bill can probably be a million dollars, I do not know.
    You can tell me on that.  Hundreds of thousands anyway for sure,
    because they can have lots of complications and need a ventilator
    for several months and they can have all kinds of surgical
    complications.  So high risks of prematurity and other
    complications, you will have a higher mortality rate for newborns,
    higher stillbirth rate, and a lot higher expense due to intensive care
    costs.
    	MS. SOLIS.  One other question I had was you talked about
    foster care and not being able to receive adequate information for
    immunization, basic things that should be made available.  We
    heard earlier from the other panel that that was not the case, that
    they are able to get that information and they can collaborate.
    Could you please allude to me, am I getting something wrong
    here?
    	MR. MICHAELS.  Well, I guess it is one of those things where
    there is probably some theoretical--I do not know all the details of
    what the caseworkers are doing when they do the intake, but all I
    can tell you from a practical standpoint, most of the time, every
    day--well, we see foster kids every day in our office and when we
    see a new foster child, I generally do not have any medical records
    at all at that visit.  I generally do not have the immunization
    records, I generally do not have allergies, any of those things.
    	MS. SOLIS.  Generally what would the time frame be for you to
    receive that information?  Does it vary, is it more than a year?
    	MR. MICHAELS.  It can really vary, because these kids--they are
    put in foster care here but they may have lived in south Georgia
    prior to that.  We do have an immunization registry in Georgia, so
    that problem that we alluded to hopefully will be improving over
    time, but it is not fully in use by all parties yet.
    	MS. SOLIS.  One of the other questions I had was regarding the
    EMTALA law and what would happen if there were restrictions on
    that.  If, for example, women who were undocumented were
    removed from assistance, what would happen to the State of
    Georgia?
    	MR. MICHAELS.  You are talking about pregnant women?
    	MS. SOLIS.  Uh-huh.
    	MR. MICHAELS.  If pregnant women came in and EMTALA
    had been relaxed and the hospital was not obliged to treat those
    women, you would have a lot of complications.  You could have
    mortality, a woman could die of a ruptured placenta and just bleed
    and the baby and the mother could die, there could be infection and
    sepsis which are life-threatening for the baby and for the mother as
    well.
    	MS. SOLIS.  Do you honestly believe that by taking away that
    service, that people are going to have less pregnancies?
    	MR. MICHAELS.  No.
    	MS. SOLIS.  One last question.  With respect to your particular
    caseload of individuals, what would you say--when you get into a
    situation of providing service, do you have a rough estimate of
    what the legal and illegal are?
    	MR. MICHAELS.  I really do not know because I do not ask, first
    of all.  I do not think providers should be in the position of asking
    because that disrupts the trust of the medical home.
    	MS. SOLIS.  How would you feel if you were, according to the
    Sensenbrenner Bill, held liable, there would be penalties against
    you for servicing undocumented?  How would you--what kind of
    atmosphere would that place in your home setting or your hospital
    setting?
    	MR. MICHAELS.  It would place us in terrible conflict, but I am
    confident that Congress will not do that to the providers.
    	MS. SOLIS.  Okay, thank you.  That concludes my questions.
    	[Applause.]
    	MR. DEAL.  Dr. Norwood.
    	MR. NORWOOD.  Thank you, Mr. Chairman.
    	Mr. Gardner, according to the United States Senate
    immigration bill, the Reid-Kennedy-McCain-Hagel Bill, we would
    increase the number of citizens in this country somewhere in the
    neighborhood of 66 million new people in the next 20 years.  I
    think I know Georgia pretty well, we have got 159 counties, we
    have got rural hospitals in every county, sometimes maybe even
    two.  What is that going to do to hospitals like yours, either one of
    you, Mr. Stewart or Mr. Gardner, if we have that kind of influx of
    new people into the country over the next 20 years?
    	MR. GARDNER.  Congressman, I think it is a bit of a
    complicated answer, but you know, undoubtedly the cost of
    healthcare is going to continue to go up.  Right now, Northeast
    Georgia, we have the third busiest emergency room in the State of
    Georgia with about 105,000 visits per year.  So if you just
    extrapolate, look at the population and how many folks are
    coming, it is just going to make an already unmanageable situation
    that much more difficult.
    	MR. NORWOOD.  Well, the Rand study says most of these
    people will not have any type of healthcare insurance.  So if you
    are in a position now that you are having to cost shift over because
    you are spending so many dollars, and you said what, a  million a
    day?
    	MR. GARDNER.  A million a day.
    	MR. NORWOOD.  Something to that effect.  What is going to
    happen when it goes to three million a day?  At what point do you
    close?
    	MR. GARDNER.  What I am concerned about right now is our
    uncompensated care and bad debt has gone from $20 million to
    $30 million in the last 4 years.  That rate of growth is what is not
    sustainable.  We have literally since 1984 given away in excess of
    a quarter billion dollars of free care at Northeast Georgia
    Healthcare System.  We cannot do it.
    	MR. NORWOOD.  Why do you not just cost shift that over to the
    Americans who have healthcare insurance, make us pay for it?
    	MR. GARDNER.  Well, you know what the answer to that is, it is
    a Catch 22 because then fewer individuals continue to buy health
    insurance, the business community cannot pay for health insurance
    and we end up just exacerbating an already difficult problem.
    	MR. NORWOOD.  Well, then, cost shift it over to Medicare,
    make them pay more.
    	MR. GARDNER.  Well, Congressman, I think the answer to that
    is the DRA and there is no place to cost shift any more.
    	MR. NORWOOD.  That is exactly my point I am trying to get to.
    We are at the end of the road shifting these costs over to other
    people.
    	[Applause.]
    	MR. NORWOOD.  What is going to happen with this 66 million,
    maybe 100 million new patients that we are going to see in this
    country in regards to tuberculosis or meningitis or measles?  The
    communicable diseases that we do a pretty good job of in this
    country, but not necessarily around the world, what is going to
    happen to you with those?  Is that going to go up?
    	MR. GARDNER.  I think it is fair to say--
    	MR. NORWOOD.  Speculate, I know you cannot--
    	MR. GARDNER.  I am a hospital administrator, I am not a
    physician, but the numbers and history would tell you that as the
    population increases, the incidence of disease goes up.
    	MR. NORWOOD.  That is the point.
    	Well, one last thing.  You do not know actually for sure how
    much uncompensated care you have to extend, do you, on illegal
    aliens?  You do not know that number, do you?
    	MR. GARDNER.  No, we sure do not.
    	MR. NORWOOD.  Is that because you do not ask citizenship
    status?  Just to put together the information.
    	MR. GARDNER.  Frankly, we do not ask, it is a very
    uncomfortable situation for providers, just being honest with you.
    	MR. NORWOOD.  You do not ask people to pay you, do you?
    Are you uncomfortable asking other people to pay you?
    	[Laughter.]
    	MR. NORWOOD.  Now wait a minute, Doc, I know you do not,
    but I know the hospital does.  Are you uncomfortable asking me to
    pay you if I come to your hospital?
    	MR. GARDNER.  You would be surprised, but in our
    organization up until probably a couple of years ago, it was
    relatively lax in terms of requesting payment.  As the situation has
    worsened, we have become more appropriately inquisitive about
    payment.
    	MR. NORWOOD.  As they have all over the State, but that is not
    new.  I have been in healthcare awhile too.  Hospitals want their
    money, but you refuse to ask somebody if they are a citizen of this
    country or not?  Because you know as well as I do sitting here,
    now you can laugh it off all you want to, but that is going to
    determine whether you get paid.  It is going to determine whether
    that person pays you or whether Congressman Deal pays you.
    That is what that question is going to determine.  Why do you guys
    not ask and why does the American Hospital Association find that
    so difficult when they are right on the money when they want me
    to pay them?
    	MR. GARDNER.  You know, again, it is not why we went into
    healthcare in the first place.  And having to act as an immigration
    traffic cop does not come comfortably to us.  But the situation is
    such that that is unfortunately the world that we are probably going
    to live in, we are going to do what is required.
    	MR. NORWOOD.  You are going to do that or close.  And I have
    got 25 counties and I have got small rural hospitals all over the
    place that are going to shut down because of all this; because they
    cannot stand a million dollars a day.  You happen to be big enough
    maybe you can offset it, but most of Georgia's rural hospitals
    simply cannot continue with this.
    	Let us talk just real quickly about birthright citizenship.  To my
    knowledge, there is not one Nation, at least western nation, that
    allows birthright citizenship besides the United States.  Now I
    noticed when that subject came up a minute ago, three or four
    people in this room were just adamantly against us doing away
    with that, just shaking their head all over the place.  We have got to
    have birthright citizenship.
    	But the rest of the world is not doing that.  I wonder why they
    are not doing that kind of thing?  Mexico does not do that.  Why do
    we not follow their lead?  Why do we not do like they do?  They
    do not allow you to be born in Mexico and immediately become a
    citizen.  Why is it people from Mexico who come here want us to
    do the absolute opposite?
    	Last quick question.  Doctor, how many Medicaid patients in
    your practice?
    	MR. MICHAELS.  We have about 5,500.
    	MR. NORWOOD.  What percent might that be?
    	MR. MICHAELS.  About 75 percent of the folks we see are on
    Medicaid or SCHIP.
    	MR. NORWOOD.  Do you have any idea in your practice how
    many of those Medicaid patients might be illegal aliens?
    	MR. MICHAELS.  I do not know.  You know, most of our
    Medicaid patients are young age, so most of them were born here
    in the United States, so by definition of the current situation, I
    think they are citizens.
    	MR. NORWOOD.  So let me maybe phrase it another way.  Do
    you know the percentage of those that might be parents of illegal
    aliens?
    	MR. MICHAELS.  I have no idea.
    	MR. NORWOOD.  Yeah, you are not interested in knowing?
    	MR. MICHAELS.  Well, because the Hippocratic Oath that I
    took in medical school when I graduated said "Do no harm."  And
    the medical home--
    	[Applause.]
    	MR. MICHAELS.  --is a critical concept for me in my provision
    of care to patients and is based on a trusting relationship between
    the parents and provider.
    	MR. NORWOOD.  I understand.
    	MR. MICHAELS.  and if I ask them that question, the trust is
    totally eroded.  They will not come back.
    	MR. NORWOOD.  I understand.  But the Hippocratic Oath says
    "Do no harm," and we are doing a tremendous harm to this
    country, to the medical system and the citizens of this Nation--
    	[Applause.]
    	MR. NORWOOD.  --by not dealing with this upfront and being
    honest with ourselves and being honest with people who are
    crossing our borders illegally.  We have to face this problem and
    deal with it.
    	Sorry, Mr. Chairman, I went over.  Thank you very much.
    	MR. DEAL.  Well, I want to thank this panel as well and this
    concludes this hearing.  I think whether there is agreement or
    disagreement on the issues that have been discussed here, I think it
    does illustrate the difficulty that the issue of illegal immigration
    has created in our country and by the consequence of that, the
    difficulty of Congress arriving at a reasonable and fair solution to
    it.
    	We appreciate the testimony of all the witnesses.  We thank the
    audience for your participation, and with that this field hearing is
    adjourned.
    	[Whereupon, at 12:55 p.m., the Committee was adjourned.]