[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.]
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