[House Hearing, 112 Congress]
[From the U.S. Government Publishing Office]
POLICIES AND PROCEDURES
OF THE U.S. DEPARTMENT OF
HEALTH AND HUMAN SERVICES
=======================================================================
HEARING
before the
COMMITTEE ON EDUCATION
AND THE WORKFORCE
U.S. HOUSE OF REPRESENTATIVES
ONE HUNDRED TWELFTH CONGRESS
FIRST SESSION
__________
HEARING HELD IN WASHINGTON, DC, MAY 5, 2011
__________
Serial No. 112-20
__________
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COMMITTEE ON EDUCATION AND THE WORKFORCE
JOHN KLINE, Minnesota, Chairman
Thomas E. Petri, Wisconsin George Miller, California,
Howard P. ``Buck'' McKeon, Senior Democratic Member
California Dale E. Kildee, Michigan
Judy Biggert, Illinois Donald M. Payne, New Jersey
Todd Russell Platts, Pennsylvania Robert E. Andrews, New Jersey
Joe Wilson, South Carolina Robert C. ``Bobby'' Scott,
Virginia Foxx, North Carolina Virginia
Duncan Hunter, California Lynn C. Woolsey, California
David P. Roe, Tennessee Ruben Hinojosa, Texas
Glenn Thompson, Pennsylvania Carolyn McCarthy, New York
Tim Walberg, Michigan John F. Tierney, Massachusetts
Scott DesJarlais, Tennessee Dennis J. Kucinich, Ohio
Richard L. Hanna, New York David Wu, Oregon
Todd Rokita, Indiana Rush D. Holt, New Jersey
Larry Bucshon, Indiana Susan A. Davis, California
Trey Gowdy, South Carolina Raul M. Grijalva, Arizona
Lou Barletta, Pennsylvania Timothy H. Bishop, New York
Kristi L. Noem, South Dakota David Loebsack, Iowa
Martha Roby, Alabama Mazie K. Hirono, Hawaii
Joseph J. Heck, Nevada
Dennis A. Ross, Florida
Mike Kelly, Pennsylvania
[Vacant]
Barrett Karr, Staff Director
Jody Calemine, Minority Staff Director
C O N T E N T S
----------
Page
Hearing held on May 5, 2011...................................... 1
Statement of Members:
Barletta, Hon. Lou, a Representative in Congress from the
State of Pennsylvania, question submitted for the record... 7
Kline, Hon. John, Chairman, Committee on Education and the
Workforce.................................................. 1
Prepared statement of.................................... 3
Questions submitted for the record....................... 7
McCarthy, Hon. Carolyn, a Representative in Congress from the
State of New York, question submitted for the record....... 9
Miller, Hon. George, senior Democratic member, Committee on
Education and the Workforce................................ 4
Prepared statement of.................................... 6
Additional submission: Letter from David Rosnick, Center
for Economic and Policy Research 9
Roe, Hon. David P., a Representative in Congress from the
State of Tennessee, question submitted for the record...... 8
Walberg, Hon. Tim, a Representative in Congress from the
State of Michigan, questions submitted for the record...... 7
Woolsey, Hon. Lynn C., a Representative in Congress from the
State of California, questions submitted for the record.... 8
Statement of Witnesses:
Sebelius, Hon. Kathleen, Secretary, U.S. Department of Health
and Human Services......................................... 10
Prepared statement of.................................... 12
Responses to questions submitted for the record.......... 59
POLICIES AND PROCEDURES
OF THE U.S. DEPARTMENT OF
HEALTH AND HUMAN SERVICES
----------
Thursday, May 5, 2011
U.S. House of Representatives
Committee on Education and the Workforce
Washington, DC
----------
The committee met, pursuant to call, at 10 a.m., in room
2175, Rayburn House Office Building, Hon. John Kline [chairman
of the committee] presiding.
Present: Representatives Kline, Petri, Biggert, Foxx, Roe,
Walberg, DesJarlais, Hanna, Rokita, Bucshon, Gowdy, Barletta,
Ross, Kelly, Miller, Kildee, Payne, Andrews, Scott, Woolsey,
Hinojosa, McCarthy, Tierney, Kucinich, Wu, Davis, Grijalva, and
Hirono.
Staff Present: Andrew Banducci, Professional Staff Member;
Katherine Bathgate, Press Assistant/New Media Coordinator;
James Bergeron, Director of Education and Human Services
Policy; Casey Buboltz, Coalitions and Member Services
Coordinator; Heather Couri, Deputy Director of Education and
Human Services Policy; Daniela Garcia, Professional Staff
Member; Ed Gilroy, Director of Workforce Policy; Benjamin Hoog,
Legislative Assistant; Amy Raaf Jones, Education Policy Counsel
and Senior Advisor; Marvin Kaplan, Professional Staff Member;
Barrett Karr, Staff Director; Ryan Kearney, Legislative
Assistant; Brian Newell, Deputy Communications Director;
Krisann Pearce, General Counsel; Molly McLaughlin Salmi, Deputy
Director of Workforce Policy; Ken Serafin, Workforce Policy
Counsel; Linda Stevens, Chief Clerk/Assistant to the General
Counsel; Alissa Strawcutter, Deputy Clerk; Loren Sweatt,
Professional Staff Member; Joseph Wheeler, Professional Staff
Member; Aaron Albright, Minority Communications Director for
Labor; Tylease Alli, Minority Hearing Clerk; Jody Calemine,
Minority Staff Director; Ruth Friedman, Minority Director of
Education Policy; Brian Levin, Minority New Media Press
Assistant; Jerrica Mathis, Minority Legislative Fellow, Labor;
Megan O'Reilly, Minority General Counsel; Julie Peller,
Minority Deputy Staff Director; Meredith Regine, Minority Labor
Policy Associate; Laura Shifter, Minority Senior Education and
Disability Advisor; and Michele Varnhagen, Minority Chief
Policy Advisor and Labor Policy Director.
Chairman Kline. A quorum being present, the committee will
come to order.
Well, good morning, everybody.
Good morning, Madam Secretary, welcome. We are delighted
that you are here. I believe this is your first appearance
before the committee, and we certainly appreciate the
opportunity to meet with you today.
I realize your time is valuable, and we only have a small
window to discuss a small range of topics. As we discussed
earlier, it is likely that we will be interrupted by votes
pretty quickly, so an administrative comment for all of my
colleagues: Mr. Miller and I and the Secretary are going to all
try to get our opening statements done, and at least Mr. Miller
and I, depending upon how quickly they call votes.
By any definition, the Department of Health and Human
Services is a massive Federal agency. It employs nearly 76,000
workers and maintains an annual operating budget in excess of
$800 billion, the largest of any agency in the Federal
Government.
While a great deal of the Department's resources is
directed to Medicare and Medicaid, more than $100 billion in
taxpayer money is spent on various social service programs.
Many of these programs fall within the jurisdiction of this
committee, such as welfare, the Community Services Block Grant,
and provisions of the Child Abuse Prevention and Treatment Act.
No doubt these programs are well intended. They reflect our
Nation's ongoing commitment to serving those in need. In recent
years, however, the Federal budget has been placed on an
unsustainable path taxpayers can no longer afford. This growth
has forced us to take a hard look at every facet of the Federal
Government as we consider how to reign in spending.
I realize the administration has offered some modest
proposals for scaling back the cost of your Department, Madam
Secretary. However, these proposals fail to rise to the
challenges we face. If we adopt the President's plan, the
Congressional Budget Office reports the Federal Government will
spend $46.2 trillion, impose $1.5 trillion in new taxes, and
add roughly $9 trillion to the national debt over the next
decade.
This is unacceptable.
In health care, the news is just as disappointing. It has
been a little more than a year since the President signed his
health care bill into law, yet already the price tag for the
new law has increased by more than 50 percent. A plan that
supporters promised would reduce costs, will instead charge
taxpayers more than $2.6 trillion when fully implemented, and
add more than $700 billion to the deficit.
Our national conversation has become so consumed by
trillions and billions, that it is almost impossible to
comprehend the magnitude of the crisis we face. These reckless
policies affect not only the Nation's bottom line, they
undermine confidence in our economy and harm job creators'
ability to expand businesses or hire new workers.
The current fiscal crisis demands we examine every program
to ensure every taxpayer dollar is spent efficiently and
effectively. Every Federal agency must be part of that effort.
If we fail to promote responsible reforms and make tough
choices, our Nation will no longer be able to provide
assistance to those who need it most. Those who argue for a
timid response threaten the very safety net many Americans rely
upon.
We know many of the decisions we must make will be
unpopular. Writing about the spending cuts in the final
appropriations bill, the President's communications director
noted ``Many will be painful, and are to programs that we
support, but the fiscal situation is such that we have to act.
``And I couldn't agree more.
The Nation faces an historic moment: We can continue the
status quo of more spending, more taxes, and more debt that
will ultimately lead to our Nation's decline, or we can make
the tough, yet necessary, choices to preserve the promise of
our country and the prosperity of our children. That is the
course the majority of this House has supported and one that I
believe an overwhelming majority of the American people expect
us to take.
[The statement of Chairman Kline follows:]
Prepared Statement of Hon. John Kline, Chairman,
Committee on Education and the Workforce
A quorum being present, the committee will come to order.
Good morning and welcome Madam Secretary. I believe this is your
first appearance before the Committee, and we certainly appreciate the
opportunity to meet with you today. I realize your time is valuable and
we only have a small window to discuss a wide range of topics. I will
keep my opening remarks brief to help ensure all members have ample
opportunity to discuss with you the department's policies and
priorities.
By any definition, the Department of Health and Human Services is a
massive federal agency. It employs nearly 76,000 workers and maintains
an annual operating budget in excess of $800 billion, the largest of
any agency in the federal government.
While a great deal of the department's resources are directed to
Medicare and Medicaid, more than $100 billion in taxpayer money is
spent on various social service programs. Many of these programs fall
within the jurisdiction of this Committee, such as welfare, the
Community Services Block Grant, and provisions of the Child Abuse
Prevention and Treatment Act.
No doubt these programs are well intended. They reflect our
nation's ongoing commitment to serving those in need. In recent years,
however, the federal budget has been placed on an unsustainable path
taxpayers can no longer afford. This growth has forced us to take a
hard look at every facet of the federal government as we consider how
to rein in spending.
I realize the administration has offered some modest proposals for
scaling back the costs of your department. However, these proposals
fail to rise to the challenges we face. If we adopt the president's
plan, the Congressional Budget Office reports the federal government
will spend $46.2 trillion, impose $1.5 trillion in new taxes, and add
roughly $9 trillion to the national debt over the next decade. This is
unacceptable.
In health care, the news is just as disappointing. It has been a
little more than a year since the president signed his health care bill
into law, yet already the price tag for the new law has increased by
more than 50 percent. A plan that supporters promised would reduce
costs will instead charge taxpayers more than $2.6 trillion when fully
implemented and add more than $700 billion to the deficit.
Our national conversation has become so consumed by ``trillions''
and ``billions'' that it's almost impossible to comprehend the
magnitude of the crisis we face. These reckless policies affect not
only the nation's bottom line, they undermine confidence in our economy
and harm job-creators' ability to expand businesses or hire new
workers.
The current fiscal crisis demands we examine every program to
ensure every taxpayer dollar is spent efficiently and effectively.
Every federal agency must be part of that effort. If we fail to promote
responsible reforms and make tough choices, our nation will no longer
be able to provide assistance to those who need it most. Those who
argue for a timid response threaten the very safety net many Americans
rely upon.
We know many of the decisions we must make will be unpopular.
Writing about the spending cuts in the final appropriations bill, the
president's communications director noted, ``Many will be painful, and
are to programs that we support, but the fiscal situation is such that
we have to act.'' I couldn't agree more.
The nation faces a historic moment: We can continue the status quo
of more spending, more taxes, and more debt that will ultimately lead
to our nation's decline, or we can make the tough yet necessary choices
to preserve the promise of our country and the prosperity of our
children. That is the course a majority of this House has supported,
and one that I believe an overwhelming majority of the American people
expect us to take.
______
Chairman Kline. At this time I would like to recognize Mr.
Miller, the senior Democratic member of the committee, for his
opening remarks.
Mr. Miller. Thank you, Mr. Chairman. Thank you for having
this hearing. I want join you in welcoming Secretary Sebelius
to the committee.
From educating our youngest children in Head Start to
ensuring seniors' access to health care and Medicare, your
Department administers programs that have unquestionably made
our families and communities healthier and our country
stronger. In recent months, we have seen an unprecedented
attack on these programs that help millions of American
families.
While we must address our Nation's long-term deficits, the
budget priorities pursued by the Republican majority have put
much of the sacrifice directly on the backs of children and
seniors. Cutting 130,000 children from Head Start isn't about
rebuilding our economy. The repealing of the historic health
care reform law won't help families and businesses get costs
under control.
You and your Agency, Madam Secretary, have primary
responsibility for the implementation of the Affordable Care
Act. A year after its enactment, the reform bill is still doing
the right thing. It is the right thing to do to help families
struggling with affordable coverage; it is the right thing to
do for businesses crushed by skyrocketing premiums over the
last decade; and it was the right thing to do to finally end
the worst abuses of the insurance industry.
The Affordable Care Act also makes significant strides in
combating fraud and abuse in the Medicare and Medicaid system,
and it includes key health care cost controllers, identified by
top experts, as critical to getting costs under control without
rationing care.
And this is part of keeping the bargain, the bargain and
the promise that this country made to our Nation's seniors, and
it is a promise and a bargain than this Nation must keep to our
seniors. However, the same cannot be said about the
Republicans' budget. They achieved savings not by making
Medicare work better, but by shifting costs onto seniors.
In fact, according to the report we released this morning,
seniors would have to shoulder approximately $6,400 more in
health care costs in 2022. The typical 65-year-old in 2022 will
spend half of their Social Security on health insurance
premiums under the Republican budget plan, and that cost
increases with each passing year.
Using the CBO numbers, the Center for Economic Policy and
Research has found that to buy a Medicare-equivalent policy
under the Republican plan, the median 85-year-old in 2050 would
have to spend twice their annual income.
In this committee, we should be concerned about what this
means for workers today. Based upon further analysis by the
Center, which I submit for the record, the 54-year-old today
would have to save an additional--an additional $182,000 over
the next 11 years just to pay for the increased health care
costs under the Republican budget.
This is over and above what they are already putting away
every month in their savings, in their 401(k)s and in their
retirement plans. So these workers will have to find around an
extra $1,000 to $1,300 a month to put in their IRAs or their
401(k) plans, and that is contingent on the market not crashing
right before they retire.
This committee has been concerned for years about the
sufficiency of workers' retirement plans. In 2007, before the
recent crisis, the Census Bureau found that half of all the
workers had no retirement savings. In 2010, the Employee
Benefit Research Institute found that the average retirement
savings shortfall was over $47,000 per individual, and all of
that was counting on Medicare.
So how do these workers find another $182,000, especially
since for middle-class workers in this country, wages have
essentially been stagnant since the 1970s and labor protections
for workers who try to organize and do better on the job for
their families and for their communities, their ability to
organize is now under attack. Under the Republican plan,
seniors will go into debt and they will be forced to sell their
homes that they have spent a lifetime paying off, and they will
have to rely on their children just to pay basic medical care.
This is not what anyone envisioned as a dignified
retirement. This was not the bargain. This was not the promise
that this Nation made with its seniors. And I say that, clearly
understanding the need for additional reforms to make sure that
Medicare is sustainable for seniors in the future and
sustainable for taxpayers.
I am very encouraged to see that as the Republican
negotiators go to the White House today, they are reconsidering
the idea that they would split Medicare, that they would put
the 65-year-old in the jeopardy that I outlined under the
economic policy study, and they would put this burden on the
savings of middle-class Americans today. And they also have the
ability, as they go to the White House, to think about whether
or not Medicare is going to be included in the discussions
around the debt limit. It sounds like they are reconsidering
that. I hope they are.
They can also understand that they can build on the
trillion, about 700, or is it--a little over $700 billion that
they have adopted in Medicare savings for their budget that are
in the Affordable Care Act. And so hopefully we can continue to
build on those kinds of savings that come from bending the cost
curve for health care for seniors in this country and for the
cost of the Medicare program.
Again, I welcome you to the committee and thank you so much
for your service to our country.
Chairman Kline. I thank the gentleman.
[The statement of Mr. Miller follows:]
Prepared Statement of Hon. George Miller, Senior Democratic Member,
Committee on Education and the Workforce
I am pleased that we are having a hearing on the critically
important work of our nation's employment and workforce training
programs. I would like to thank our distinguished panel of witnesses
for joining us today.
While our economy is moving in the right direction, in my
congressional district and across our nation, millions of American
workers continue to struggle to find good jobs and make ends meet.
In order to thrive in today's workforce, American workers,
particularly those adults and youth who are unemployed, dislocated, or
disadvantaged, need education and training, counseling, guidance, and
support to secure family-sustaining jobs, achieve their educational
goals, and improve their lives.
In part, today's hearing will focus on recent reports released by
GAO on federal programs that provide some form of employment and
training services. In these reports, GAO has recommended co-locating
and consolidating administrative structures to avoid duplicating
services.
In addition, the GAO recommended that the Secretaries of Labor and
HHS work together to develop and disseminate information to encourage
such efforts.
While my colleagues on the other side of the aisle support the
consolidation of administrative structures and funding streams and
argue that any savings should be applied to the deficit, I believe that
consolidation should be used to improve the quality and accessibility
of employment and job training services.
If the process of co-locating or consolidating programs leads to a
savings, I strongly believe that these resources should be reinvested
into our public workforce and adult education system and be used to
address the needs of those workers who are hardest to serve. Those who
are jobless desperately need our help to improve their lives.
In the R!o Grande Valley of South Texas, we have waiting lists for
adult education and employment and training services and are unable to
meet the needs of our most vulnerable workers and youth due to limited
resources.
As Ranking Member of the Subcommittee on Higher Education and
Workforce Training, reauthorizing and improving the Workforce
Investment Act (WIA) and adequately funding our nation's public
workforce and adult education system are top priorities for me. In my
view, our public workforce and adult education system has been starved
for far too long.
It is my hope that we, the members of this committee, can identify
areas of common ground and work in a bipartisan manner to reauthorize
WIA in the 112th Congress.
______
Chairman Kline. Pursuant to committee rule 7(c) all
committee members will be permitted to submit written
statements to be included in the permanent hearing record.
Without objection, the hearing record will remain open for
14 days to allow statements, questions to the record, and other
extraneous material referenced during the hearing to be
submitted in the official hearing record.
[The information follows:]
U.S. Congress,
Washington, DC, June 28, 2011.
Hon. Kathleen G. Sebelius, Secretary,
U.S. Department of Health and Human Services, 200 Independence Ave.,
SW, Washington, DC 20201.
Dear Secretary Sebelius: Thank you for testifying at the Committee
on Education and the Workforce's May 5, hearing on ``Policies and
Priorities of the U.S. Department of Health and Human Services.'' I
appreciate your participation.
Enclosed are additional questions submitted by Committee members
following the hearing. Please provide written responses that answer the
questions posed no later than July 12, 2011, for inclusion in the
official hearing record. Responses should be sent to Benjamin Hoog of
the Committee staff, who can be contacted at (202) 225-4527.
Thank you again for your contribution to the work of the Committee.
Sincerely,
John Kline,
Chairman
questions from representative kline
1. HEAD START FRAUD AND ABUSE. Last year, the U.S. Government
Accountability Office (GAO) conducted an undercover investigation of 15
Head Start programs, acting in response to tips from former and current
employees at two separate Head Start centers. Undercover GAO applicants
tried to enroll children in these programs and presented the centers
with pay stub data that demonstrated they were above income eligibility
requirements. Nine of the 15 sites enrolled the students by encouraging
applicants not to submit the pay stubs that would put them over the
income threshold. Some of the programs continued to count the students
as enrolled, even though the students never actually participated in
the program. At a May 2010 hearing before this Committee, the Assistant
Secretary for Children and Families stated that the Department was
taking immediate corrective action and was undertaking a ``top-to-
bottom'' review of its program oversight responsibilities. Can you give
us an update on the Department's effort to combat waste, fraud, and
abuse in the Head Start program? How many unannounced monitoring visits
has the Department conducted since the release of the GAO report?\1\
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\1\ http://www.gao.gov/new.items/d10733t.pdf.
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2. RECOMPETITION OF HEAD START GRANTEES. In 2007, Congress passed
the Improving Head Start for School Readiness Act, which requires the
Secretary of Health and Human Services to establish a new,
comprehensive system to recompete Head Start and Early Start grants.
The Department is currently in the process of finalizing regulations on
recompetition to ensure that Head Start grantees are meeting the
requirements of the law and preparing pre-school-aged children for
entry into kindergarten. Please provide us with an update on this
process. When will the first grantees be re-evaluated?
3. EFFECTIVENESS OF THE COMMUNITY SERVICES BLOCK GRANT PROGRAM. The
President's FY2012 budget request includes a $388 million cut to the
Community Services Block Grant program, which is geared toward anti-
poverty activities. Over the last 10 years, a number of independent
studies and research activities, including those conducted by the U.S.
Government Accountability Office (GAO), have questioned the program's
effectiveness in combating poverty in local communities. What changes
do you think the Committee should make to the program to make it more
effective? When was the last time the program was evaluated and what
were the results?
4. HEALTH INSURANCE EXCHANGES: You claim in your testimony that in
2014, state health insurance exchanges will provide new options for
consumers. However, it has been reported that several governors have
vetoed bills intended to implement the new law's requirement for state-
based Health Insurance Exchanges, and many states are not working
toward establishing such exchanges. Also, one governor rejected a $54
million ``early innovator'' grant for an exchange partly on the basis
that states do not want to be subjected to federal regulation. Assuming
some states will not create health insurance exchanges by 2014, at what
point will HHS develop the federal insurance exchange option that would
be available to consumers in those states? Can you elaborate on the
structure of this option?
questions from representative walberg
For nearly 20 years, the National Institute for Occupational Safety
and Health (NIOSH) along with the National Cancer Institute (NCI)
conducted a study on the potential effects of diesel exhaust in
underground mines. The Mining Awareness Resources Group (MARG)
voluntarily participated in the study by providing access and
information for NIOSH to conduct the study; however this was done with
the understanding that NIOSH would be providing the study data to the
group in order to review the studies. Two federal court orders have
ordered NIOSH to provide the data to MARG and the Committee on
Education and the Workforce, yet the institute has not fully complied.
1. Why has NIOSH not complied with the court orders of two federal
judges?
2. When will the data be made available to all parties involved?
question from representative barletta
1. A number of smaller pharmacies in my district in Northeastern
Pennsylvania have raised concerns regarding the impact of ``rapid
refills'' on patient care. As you know, an increasing number of doctors
are issuing prescriptions for 90 day supplies of medication. However,
the patient's condition may change, forcing a doctor to modify the
prescription prior to the patient exhausting the huge supply.
Additionally, the patient loses out on valuable and more frequent in-
person counseling offered by local brick and mortar pharmacies. Can you
give the Agency's perspective on the challenges to patient care
associated with so-called ``rapid refills''? How has the Patient
Protection and Affordable Care Act interfered with this process?
question from representative roe
1. During our dialogue at the May 5, 2011, hearing of the Education
and the Workforce Committee, you stated that of the 30 million to 35
million Americans who will receive coverage as a result of PPACA, ``* *
* about 15 million are likely to be Medicaid-eligible.'' However
Medicare's chief actuary has indicated that the number of new Medicaid
enrollees could rise as high as 25 million given that Social Security
benefits will not be counted as income for the purpose of determining
Medicaid eligibility.\2\ How then, is PPACA not just a massive
expansion of Medicaid?
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\2\ See http://republicans.energycommerce.house.gov/Media/file/
Hearings/Health/033011/Foster.pdf.
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questions from representative woolsey
1. The HHS FY 12 budget proposes to zero out two programs in the
National Institute for Occupational Safety and Health (NIOSH): the
Education & Research Center (ERC) program and the Agriculture, Fishing
and Forestry (AFF) program. Combined, these two programs total less
than $50 million. The ERCs were established to implement Section 21 of
the Occupational Safety and Health Act's (OSHAct) requirement to train
``an adequate supply'' of occupational safety and health professionals
to implement the law.
A. With regard to the AFF program, fatality rates in agriculture,
fishing and forestry are more than seven times the average--and cost
our economy $4 billion per year. NIOSH has developed technology to save
lives and property in these industries. The National Academy of
Sciences (NAS) found this program conducts high priority, sound
research, but indicated that there were opportunities for improvement.
The HHS FY 12 budget request zeroes out the program, claiming the
program was ineffective, and asserts that the Agriculture Department
and the Labor Department can pick up the slack when this program is
zeroed out. The NAS panel members have written to Congress contending
that the HHS budget justification misrepresents their 2007 report.
i. What specific authorization and funding is available in the
Labor Department or Agriculture Department in the President's FY 12
budget to replace the NIOSH AFF research program?
ii. Will you be willing to review the budget justification for the
AFF program to determine if it is valid and factually supported?
iii. Would you be willing to work with the Committee to identify
funds within HHS's operating divisions that could be reallocated to
allow this priority NIOSH work to continue?
B. With regards to the ERC program, the HHS FY 12 budget request
justifies termination on the grounds that NIOSH had planned to sunset
funding after 5 years; however, neither the Centers for Disease Control
nor OMB can find any documents to back this up. Congress never intended
to sunset this program after 5 years, and the Institute of Medicine
recommended continuing this program.
i. Has HHS conducted a recent assessment of whether the ERC program
has fulfilled its mission pursuant to Section 21 of the OSHAct? If so,
has such assessment determined that there is an adequate supply of
occupational safety and health professionals?
ii. If such study had not been done, why would HHS terminate this
program before such assessment has been completed?
iii. Will you be willing to undertake a review to determine if the
budget justification for the ERC program is valid and fully supported?
iv. Would you be willing to work with the Committee to identify
funds within HHS's operating divisions that could be reallocated to
allow this priority NIOSH work to continue?
question from representative mccarthy
1. Congress included a provision in the Patient Protection and
Affordable Care Act requiring that patients receiving Medicare home
health services have a face-to-face encounter with a referring
physician prior to certification for home health services.
Having heard from both home health care providers and physician
groups alike, I am concerned that in implementing the provision, CMS
has gone beyond Congressional intent. In doing so, the agency has
created significant additional administrative paperwork and
documentation burdens on physicians for which they are not reimbursed.
The requirement also creates obstacles to care for patients, who are by
definition homebound, and may not have convenient access to physician
offices.
I am very concerned that the outcome of this will be that patients
are denied access to the care they need, and that is provided in both
the lowest cost and most desired setting--one's own home.
We will continue to work with the agency, but would appreciate your
attention and thoughts on this matter as well. Would you support
efforts to streamline and simplify the process for documenting the face
to face encounter so that we address concerns of referring physicians,
home health providers, and the patients they serve?
______
[Additional submission of Mr. Miller follows:]
Center for Economic and Policy Research,
Washington, DC.
Hon. George Miller, 2205 Rayburn House Office Building Washington, DC.
Dear Representative Miller: Thank you for your interest in our
report ``Representative Ryan's $30 Trillion Medicare Waste Tax.''
According to Figure 1 of the Congressional Budget Office's letter
to Paul Ryan, the cost of purchasing private health insurance
equivalent to that which Medicare provides is 12 percent higher than
the cost to Medicare in 2011. CBO projects that the additional cost
from providing care through private insurers will grow to 67 percent of
the total cost of Medicare by 2030.
Consequently, under the Ryan plan, a person born in 1957 must spend
approximately $16,900 (in today's dollars) to purchase Medicare-
equivalent insurance in 2022. Through Medicare, the insurance would
cost only $11,200. This implies $5,700 of waste.
As this beneficiary ages, both the general increase in health care
prices and the increased burden of providing health care with age will
conspire to raise this person's cost of insurance. At age 65, a person
born in 1957 will require an additional $182,000 in retirement
savings--earning 3 percent real interest--in order to purchase private
insurance rather than accept coverage through Medicare through age 84.
In part, this $182,000 reflects additional sharing of costs imposed
the Ryan plan. The Ryan plan would shift approximately $20,800 in costs
from the government to this beneficiary between 2022 and 2041. Thus,
the shift requires the beneficiary to set aside $14,000 in retirement
savings by age 65 as well as $6,800 in interest income in order to make
up for the reduced support from the government.
The remaining $168,000 in required retirement savings--again
generating annual interest at a rate 3 percentage points above
inflation--reflects the additional cost of private insurance. The total
cost of private insurance would be $557,300, compared to $322,200
through Medicare. The principal and interest on $168,000 would suffice
to cover this $235,100 difference in insurance costs from age 65
through age 84.
Please do not hesitate to contact me if you have further questions.
David Rosnick,
Center for Economic and Policy Research.
______
Chairman Kline. Again, before I introduce our distinguished
witness, I want to make an administrative announcement. The
Secretary has a hard stop time at 12:30. I want to encourage my
colleagues, when we get into questions and answers, that you
try to abide by the 5-minute clock so that everybody has a
chance. And, again, we expect to be called to votes
momentarily.
So let me move to the introduction. The Honorable Kathleen
Sebelius was sworn in as the 21st Secretary of the Department
of Health and Human Services on April 28, 2009.
I got the wave down here. Everybody knows who the Secretary
is. So in the interest of time, Madam Secretary, you are
recognized.
STATEMENT OF HON. KATHLEEN G. SEBELIUS, SECRETARY, U.S.
DEPARTMENT OF HEALTH AND HUMAN SERVICES
Secretary Sebelius. Chairman Kline and Ranking Member
Miller, members of the committee, thank you for inviting me
here to discuss the President's 2012 budget for HHS.
The President's budget ensures Americans live within our
means. As a lead-up to the budget, we looked at all of our
programs, cut waste, eliminated programs that weren't working
well enough, redesigned our programs to put a new focus on
result. In some cases, we cut programs we would have kept in
place in better fiscal times.
At the same time, our budget protects the investments we
need to keep Americans prosperous in the years to come, from
investments in Head Start so our kids can compete with those in
any nation, to investments in biomedical research that allows
the U.S. to continue to lead the world in discoveries of
breakthrough cures and treatments.
Today I want to focus my oral testimony on some of the
provisions in our budget that will benefit the youngest and the
oldest Americans.
But first a quick update on the implementation of the the
Affordable Care Act. Thanks to the steps we have taken so far,
children can no longer be denied coverage because of their
preexisting health conditions. Families have new protections
with the Patient's Bill of Rights. Businesses are getting some
initial relief from the soaring health care costs, and seniors
have better access to prescription drugs and preventive care.
Tomorrow we will announce that more than 18,000 Americans
who have been shut out of the insurance market are now taking
advantage of the preexisting insurance plans in their States.
Some States are still reporting figures, so those numbers could
go higher, but that is about a 50 percent increase in the last
couple of months as people begin to learn about the program.
It is encouraging to see that more people who need health
insurance are getting it, but we know that is not enough, and
that is why we are continuing to work with States and national
advocates to reach eligible people and let them know coverage
is available. We are also working with insurers that have
chosen to notify people about the preexisting insurance plan
when their applications are denied, and we are evaluating ways
to reduce premiums and ease eligibility standards to expand
access to the plans. For many, these plans provide access to
lifesaving treatment, so it is vital we continue to find those
who are eligible and get them enrolled.
Our budget builds on the momentum of the the Affordable
Care Act with critical investments that provide for and protect
our most vulnerable citizens. We know there is nothing more
important to our future than the healthy development of all of
our children.
Science continues to show that success in school is
significantly enhanced by higher-quality early learning
opportunities. Earlier this year, we got the results of the
latest study to look at value of early education. Researchers
followed children from low-income families enrolled in
Chicago's early education programs until they turned 26, and
found that over that child's lifetime the program generated as
much as $11 in economic benefits for every dollar spent. Now,
that is a huge payoff. So even in tight budget times, our
budget makes room for new investments in child care and Head
Start, which have a long history of bipartisan support.
But the budget does more than provide additional resources.
It aims to raise the bar on quality in child care and early
education by supporting key reforms to transform the Nation's
early childhood system into one that fosters healthy
development and gets children ready for school.
Quality child care is more than just providing baby
sitting. It supports healthy child development and school
readiness, and that is why our budget puts forward principles
for legislation reauthorizing the main child care program, the
Child Care and Development Block Grant. These include promoting
better health and safety standards, putting more information
about the quality of different child care options into parents'
hands and improving workforce training to make sure that the
people caring for our kids have the skills they need.
We look forward to working with this committee, Mr.
Chairman, as you consider these issues. We are also promoting
better quality in Head Start, using new evidence-based
evaluations in classrooms, including a tool that will help Head
Start programs see what is working and improve what isn't.
In addition, we have revamped the training we provide to
Head Start directors and teachers to make sure best practices
actually reach the classroom. We are proposing new rules to
require the lowest performing programs, the bottom 25 percent,
to compete for funding. By giving programs incentives to raise
the quality of their services and removing the weaker programs,
we want to ensure that the best programs are the ones serving
our children.
Finally, we are pleased that the fiscal year 2011 budget
included funding to allow States to fund innovation in early
education, and our 2012 request includes $350 million to
continue this key investment.
Taken together, these initiatives are designed to create an
early learning system that gets every child ready for school,
supports healthy child development and features high standards,
whether the child is in a pre-K program, a Head Start center, a
child care center, or a family day-care home. They will help
ensure that American children start school as prepared as any
in the world.
Our budget also focuses on creating safe environments for
children and families. We thank the committee for reauthorizing
the Child Abuse Prevention and Treatment Act and the Family
Violence Prevention and Services Act last year, and our budget
includes more than $200 million for the child abuse and
domestic violence programs authorized by these laws.
The budget also provides critical support for seniors. It
invests in the care and services seniors need to stay active
and engaged in their communities, and it addresses the terrible
problem of elder abuse and provides funding for caregiver
services that give families the peace of mind and enable them
to care for near relatives.
These goals guide our Department's work on the
reauthorization of the Older Americans Act coming up later this
year.
For more than 45 years, the Older Americans Act has enjoyed
broad bipartisan support. In the past year alone, the law's
comprehensive home and community-based system has supported
nearly 11 million seniors and their family caregivers, but the
need for this kind of support continues to grow rapidly.
Every day, more than 9,000 baby boomers turn 65. That is
nearly 3.3 million a year, many of whom will be ultimately
cared for by their family members. We need to do all we can to
help families caring for their loved ones, and the Older
Americans Act gives us the tool to do just that.
We look forward to working with this committee to
reauthorize the Older Americans Act and build upon the law's
long record of success in serving our families and our
communities.
The 2012 budget makes tough choices and smart target
investments today so we can have a healthy, stronger, and more
competitive America tomorrow. That is what it takes to win the
future and that is what we are determined to do.
Thank you, Mr. Chairman, and I look forward to our
discussion.
Chairman Kline. Thank you, Madam Secretary.
[The statement of Secretary Sebelius follows:]
Prepared Statement of Hon. Kathleen Sebelius, Secretary,
U.S. Department of Health and Human Services
Chairman Kline, Ranking Member Miller, and Members of the
Committee, thank you for the invitation to discuss the policies and
priorities of the Department of Health and Human Services (HHS).
In President Obama's State of the Union address he outlined his
vision for how the United States can win the future by out-educating,
out-building and out-innovating the world so that we give every family
and business the chance to thrive. His 2012 budget is the blueprint for
putting that vision into action and making the investments that will
grow our economy and create jobs.
At the Department of Health and Human Services this means giving
families and business owners better access to health care and more
freedom from rising health care costs and insurance abuses. It means
keeping America at the cutting edge of new cures, treatments and health
information technology. It means helping our children get a healthy
start in life and preparing them for academic success. It means
promoting prevention and wellness to make it easier for families to
make healthy choices. It means building a health care workforce that is
ready for the 21st century health needs of our country. And it means
attacking waste and fraud throughout our department to increase
efficiency, transparency and accountability.
Our 2012 budget does all of this.
At the same time, we know that we cannot build lasting prosperity
on a mountain of debt. And we cannot win the future if we pass on
massive debts to our children and grandchildren. We have a
responsibility to the American people to live within our means so we
can invest in our future.
For every program we invest in, we know we need to cut somewhere
else. So in developing this budget, we took a magnifying glass to every
program in our department and made tough choices. When we found waste,
we cut it. When we found duplication, we eliminated it. When programs
weren't working well enough, we reorganized and streamlined them to put
a new focus on results. When they weren't working at all, we ended
them. In some cases, we cut programs that we wouldn't cut in better
fiscal times.
This Budget contributes to deficit reduction and meets the
President's freeze to non-security programs by offsetting critical
investments with over $5 billion in targeted reductions. These
reductions are to real programs and reflect tough choices. In some
cases the reductions are to ineffective or outdated programs and in
other areas they are cuts we would not have made absent the fiscal
situation.
The Budget proposes a number of reductions and terminations in HHS.
The Budget cuts the Community Services Block Grant in half
(by $329 million) and injects competition into grant awards.
The Budget cuts the Low Income Home Energy Assistance
Program by $2.5 billion bringing it back to the 2008 level appropriated
prior to the spike in energy prices.
The Budget also stretches existing resources through better
targeting.
The Budget redirects and increases funding in CDC to
reduce chronic disease. Rather than splitting funding and making
separate grants for heart disease, diabetes, and other chronic
diseases, the Budget proposes one comprehensive grant that will allow
States to address chronic disease more effectively.
The Budget proposes refocusing the Senior Community
Services Employment program to better integrate unemployed seniors into
their communities through community service employment assisting other
seniors to stay in their homes.
The Budget redirects prevention resources in SAMHSA to
fund evidence-based interventions and better respond to evolving needs.
States and local communities will benefit from the additional
flexibility while funds will still be competed and directed toward
proven interventions.
These are the two goals that run throughout this budget: making the
smart investments for the future that will help build a stronger,
healthier, more competitive, and more prosperous America, and making
the tough choices to ensure we are building on a solid fiscal
foundation.
This Committee has jurisdiction over several important parts of
HHS, including child care and Head Start, which focus on our youngest
citizens, programs under the Older Americans Act, which focus on our
oldest citizens, and certain child abuse, runaway and homeless youth,
and family violence programs, which focus on some of our most
vulnerable citizens.
The budget documents are available on our website. But for now, I
want to share an outline of the budget, including the areas of most
interest to this Committee, and how it will help our country invest in,
and win, the future.
Advance the Health, Safety, and Well-Being of the American People
Enhancing the Quality of Early Education: The Budget provides $6.3
billion in combined discretionary and mandatory funding for child care,
which is a $1.2 billion increase above the FY 2011 funding level. These
resources will provide child care subsidies to 1.7 million low-income
children so that their parents can work or attend training or
education. The funding also supports activities to improve the quality
of child care to support learning and success for all 12 million young
children who are in out-of-home care each week.
The Administration also supports critical reforms to the child care
program with the goal of helping more children access high quality
child care, through higher health and safety and quality standards,
development of the early childhood workforce, increased continuity of
care, and quality rating improvement systems that provide parents with
critical information about the quality of their care choices and assist
providers in reaching higher levels of quality. The Budget also
supports improvements to program integrity and accountability
initiatives. Taken together, these reforms will help transform the
nation's child care system into one that provides safe, nurturing care
that fosters healthy child development, promotes future academic
success, and supports parental employment.
Additionally, the President's Budget includes $8.1 billion for Head
Start, which will allow us to continue to serve 968,000 children in
2012. The budget request supports the critical reforms underway to
raise the bar on quality in the Head Start program, including requiring
grantees not meeting the standard for automatic noncompetitive renewal
under the Head Start Act to compete for funding to ensure that children
and families are served by the most capable providers. The budget also
supports the redesigned training and technical assistance system which
would bring current research and the best evidence-informed practice
into Head Start classrooms, including best practices for local programs
to work with their local school systems to ensure that children start
school with the skills they need and that the gains children achieve in
Head Start are sustained as the children leave Head Start and move on
to public schools.
The Administration is engaged in a multi-faceted effort to raise
the bar on quality in Head Start. The training and technical assistance
system has been revamped and now features six national centers that
focus on different elements of quality early education, including
parent engagement, quality teaching, and financial management. In
addition, we now have 10 ``Centers of Excellence'' and 130 Head Start
programs participating in a mentoring program designed to pair programs
with dedicated mentors who can help them examine their programs and
implement changes that improve quality.
Another key element of our efforts to improve quality is the
creation of a robust re-designation renewal system, called for in the
most recent Head Start reauthorization legislation. This system will
inject competition into the Head Start program and require low
performing programs to compete against other entities for continued
funding. We issued the proposed rule in September 2010 and received
many comments from around the country. We are in the process of
reviewing those comments and writing a final rule. We believe that a
strong re-competition system will promote quality in two important
ways. First, it provides new incentives for all Head Start programs to
improve their programs because programs found to be low performing will
have to compete for continued funding. Second, it provides a way to
replace low-performing programs with entities that are able to provide
higher quality early education to children.
As we work to finalize the rules for this competitive process, we
are guided by the goal of the bipartisan reauthorization legislation--
to ensure that children served in Head Start have access to high
quality early education that promotes healthy child development and
school readiness.
In fact, all of our work in early education is devoted to the goals
of fostering healthy development and school success for children.
Regardless of whether a child is in a Head Start Center, a family child
care home, a public pre-K program, or a private preschool, that child
needs quality teachers, a safe environment, healthy food, and
activities that fosters her social, emotional, physical, and cognitive
development. That is why the Administration has proposed the creation
of the Early Learning Challenge Fund. This proposed competitive grant
program would be jointly administered by the Departments of Education
and Health and Human Services and would challenge States to establish
model, coordinated, Statewide systems of early learning and development
for children from birth to kindergarten entry by raising program
standards, forging better linkages between early education programs and
elementary schools, and improving early learning workforce training so
that teachers have the skills they need. The overall program goal would
be to improve health, social, emotional, and educational outcomes for
young children so that they develop the skills and abilities necessary
to succeed in school and in life.
The Administration's agenda on early education--including both
investments and the focus on quality--are key elements of the broader
education agenda designed to help every child reach his or her academic
potential and improve our nation's competitiveness.
Child Abuse Prevention
The Budget request for child abuse prevention efforts includes
$26.5 million for grants to States and $41.7 million for grants to
community-based organizations. The request supports the reauthorization
of the Child Abuse Prevention and Treatment Act (CAPTA). This Committee
played a leading role in the successful and bipartisan reauthorization
effort last year and I appreciate your efforts. Reauthorization
included new State plan assurances and a focus on collaboration and
linkages between domestic violence and child abuse and neglect.
Reauthorization also included a new funding formula adjustment should
appropriations exceed FY 2009 amounts by more than $1 million. These
funds will continue to help support improved child protection systems,
including prevention services for families. Child abuse and neglect
continues to be a significant problem in the United States. CAPTA funds
support the efforts in establishing and maintaining effective systems
of child protection, a critical element in eliminating the tragedy of
child abuse and neglect, and support direct services to families.
Preventing Domestic Violence
The President's FY 2012Budget provides $140 million to shelter and
serve victims of domestic violence and their children, as well as
prevent domestic abuse before it starts. The request supports the newly
reauthorized Family Violence Prevention and Services Act, and funds
over 1,300 battered women's shelters, evidence-based prevention
strategies, and the National Domestic Violence Hotline. The Hotline
receives over 24,000 calls per month, with most callers reporting it is
their first request for help. Again, I would like to thank this
Committee for its bipartisan work to reauthorize these important
programs last year.
Child Support and Fatherhood Initiative: The Budget includes $305
million in FY 2012 and $2.4 billion over 10 years for the Child Support
and Fatherhood Initiative. This initiative is designed to promote
strong family relationships by encouraging fathers to take
responsibility for their children, changing policies so that more of
fathers' support reaches their children, and continuing a commitment to
vigorous enforcement. The Budget increases support for States to pass
through child support payments to families, rather than retaining those
payments, and requires States to establish safe access and visitation
arrangements as a means of promoting father engagement in their
children's lives. The Budget also provides a temporary increase in
incentive payments to States based on performance, which continues an
emphasis on program outcomes and will foster enforcement efforts when
state budgets are stretched.
Reform and Reauthorize the Foster Care Financing System: The Budget
includes an additional $250 million in mandatory funds in FY 2012 and a
total of $2.9 billion over 10 years to align financial incentives with
improved outcomes for children in foster care and those who are
receiving in-home services from the child welfare system in order to
prevent entry or re-entry into foster care. We look forward to working
with the Committee to improve outcomes for vulnerable children in our
child welfare system.
Domestic Sex Trafficking
Contrary to a common assumption, human trafficking is not just a
problem in other countries. Cases of human trafficking have been
reported in all 50 States, Washington D.C., and U.S. territories.
Victims of human trafficking can be children or adults, U.S. citizens
or foreign nationals, male or female. The President's FY 2012 budget
proposed $5 million for training to address sex trafficking of runaway
and homeless youth and supports for those working with U.S. domestic
victims in the runaway and homeless youth population (in addition to
funding currently provided through the Office of Refugee Resettlement
for foreign trafficking victims in the United States). The
Administration's proposal would train and support those who work with
the runaway and homeless youth population to identify, prevent, and
address sex trafficking of minors in this population. These funds will
support the training and outreach for a broad range of those who work
with runaway and homeless youth, including program staff, caseworkers
and parents. Through collaboration, funds also may support partnerships
with law enforcement, attorneys, and judges to train individuals on how
to recognize and address sex trafficking among youth.
TANF Reauthorization: The President's Budget continues existing
funding for the TANF program in FY 2012. When TANF reauthorization is
considered, the Administration would be interested in exploring with
Congress a variety of strategies to strengthen the program's ability to
improve outcomes for families and children, including helping more
parents succeed as workers by building on the recent successes with
subsidized employment. One area in which HHS is already working to
improve employment opportunities is by partnering with the Department
of Labor (DOL). HHS and DOL are exploring a variety of efforts in the
employment and training area which are aimed at addressing the
challenges, strategies, incentives, and results for States and
localities to undertake collaborative initiatives. These collaborative
efforts include developing joint administrative guidance, providing
technical assistance and outreach, and leveraging research resources.
Supporting Older Adults and their Caregivers: The Budget includes
$60 million, an increase of $21 million over FY 2010, to help seniors
live in their communities without fear of abuse, and includes an
increase of $96 million for caregiver services, like counseling,
training, and respite care, to enable families to better care for their
relatives in the community. The Budget also proposes to transfer to the
Administration on Aging (AoA) a Department of Labor program that
provides community service opportunities and job training to unemployed
older adults. As part of this move, a new focus will be placed on
developing professional skills that will enable participants to provide
services that allow fellow seniors to live in their communities as long
as possible.
Reauthorizing the Older Americans Act: For more than 45 years, the
Older Americans Act (OAA) has enjoyed broad, bipartisan support. The
programs supported by the Act provide community-based supports that
assist families caring for their loved ones and help seniors stay in
their homes for as long as possible. Over the past year, nearly 11
million seniors and their family caregivers have been supported through
the OAA's comprehensive home and community-based system. Most funding
under the Older Americans Act is directed to State units on aging
which, in turn, send funding to local area agencies on aging. Funding
is also provided by formula to tribal organizations. These local
agencies partner with service providers and volunteers in their
communities to provide services to seniors. These services complement
the health care system by helping to prevent hospital readmissions,
providing transportation to doctors appointments, and supporting some
of life's most basic functions, such as assistance to elders in their
homes including delivering or preparing meals and helping them with
bathing. These services are especially critical for the nearly three
million seniors who receive intensive in-home services, half a million
of whom meet the disability criteria for nursing home admission but are
able to remain in their homes, in part, due to these community
supports.
The reauthorization of the Older Americans Act provides us with the
opportunity to work with this Committee to strengthen and build upon a
long record of success in serving our families and communities. To
support this process, over the past year the Administration on Aging
conducted the most open system for providing input on recommendations
for reauthorizing the Older Americans Act in its history, convening and
receiving reports from more than 60 reauthorization listening sessions
held throughout the country, and receiving online input from interested
individuals and organizations, as well as from seniors and their
caregivers. This input represented the interests of thousands of
consumers of the OAA's services.
Based in part upon this extensive public input process, we think
that reauthorization can strengthen the Older Americans Act and put it
on a solid footing to meet the challenges of a growing population of
seniors. We look forward to working with the Committee on bipartisan
reauthorization legislation. The following are some examples of areas
that we would like to discuss with the Committee as you consider
legislation:
Ensuring that the best evidence-based interventions for
helping older individuals manage chronic diseases are utilized. A
number of evidence-based programs have been shown to be effective in
helping participants adopt healthy behaviors, improve their health
status, and reduce their use of hospital services and emergency room
visits.
Improving the Senior Community Service Employment Program
(SCSEP) by integrating it with other seniors programs. The President's
budget proposes to move this program from the Department of Labor to
the Administration on Aging within HHS. The goal of this move is to
better integrate this program with other senior services provided by
the Older Americans Act. We would like to discuss adopting new models
of community service for this program with you, including refocusing
the program to better integrate seniors into their communities through
real community service employment serving other seniors, which enables
both to stay in the community longer.
Combating fraud and abuse in Medicare and Medicaid by
embedding the Senior Medicare Patrol Program (SMP) in the OAA as an
ongoing consumer-based fraud prevention and detection program. The SMP
program serves a unique role in the Department's fight to identify and
prevent healthcare fraud by using the skills of retired professionals
as volunteers to conduct community outreach and education so that
seniors and families are better able to recognize and report suspected
cases of Medicare and Medicaid fraud and abuse. In FY 2009, the program
educated over 215,000 beneficiaries in over 40,000 group education
sessions and one-on-one counseling sessions, resolving or referring for
further investigation over 4,000 complaints of potential fraud, error,
or abuse.
Transform Health Care
The 2012 budget gives Americans more and control over their health
care choices, so they can get affordable, high-quality care when they
need it.
Expanding Access to Coverage and Making Coverage More Secure: The
Affordable Care Act expands access to affordable coverage to millions
of Americans, strengthens consumer protections and ends some of the
worst insurance company abuses. These reforms create an important
foundation of patients' rights in the private health insurance market
and put Americans in charge of their own health care. As a result, we
have already implemented important private market reforms including
eliminating pre-existing condition exclusions for children; prohibiting
insurance companies from rescinding coverage and imposing lifetime
dollar limits on coverage; and enabling many adult children to stay on
their parent's insurance plan up to age 26. The Affordable Care Act
also established new programs to lower premiums and support coverage
options, such as the Pre-Existing Condition Insurance Plans Program and
the Early Retiree Reinsurance Program. The Act provides Medicare
beneficiaries and enrollees in private plans access to certain covered
preventative services free of charge. Medicare beneficiaries also have
increased access to prescription drugs under Medicare Part D through
provisions in the Act that close the coverage gap, known as the ``donut
hole,'' by 2020 so that seniors no longer have to fear being unable to
afford their prescriptions. Medicare beneficiaries are also eligible to
receive an annual wellness visit free of charge.
Beginning in 2014, State-based health insurance Exchanges will
create affordable, quality insurance options for many Americans who
previously did not have health insurance coverage, had inadequate
coverage, or were vulnerable to losing the coverage they had. Exchanges
will make purchasing private health coverage easier by providing
eligible consumers and small businesses with ``one-stop-shopping''
where they can compare a range of plans. New premium tax credits and
cost-sharing reductions will also increase the affordability of
coverage and care. The Affordable Care Act will also extend Medicaid
coverage to millions of low-income individuals who were previously not
eligible for coverage, granting them access to affordable health care.
Ensuring Access to Quality, Culturally Competent Care for
Vulnerable Populations: The Budget includes $3.3 billion for the Health
Centers Program, including $1.2 billion in mandatory funding provided
through the Affordable Care Act Community Health Center Fund, to expand
the capacity of existing health center services and create new access
points.
Improving Health Care Quality: The Affordable Care Act contains
numerous provisions designed to ensure that patients receive safe, high
quality care. Innovative payment and delivery reforms such as bundled
payments for a single episode of care and the formation of Accountable
Care Organizations will promote better coordinated and more efficient
care. New value-based purchasing programs for hospitals and other
health providers will reward those who deliver high quality care,
rather than simply encouraging a high volume of services. The new
Center for Medicare and Medicaid Innovation (``Innovation Center'')
will design, test, and evaluate new models of payment and delivery that
seek to promote higher quality and lower costs. Similarly, the new
Centers for Medicare & Medicaid Services' (CMS) Federal Coordinated
Health Care Office will complement these efforts to provide higher
quality and better integrated care for those who are eligible for both
Medicare and Medicaid. Reducing Health Care Costs: New innovative
delivery and payment approaches will lead to both more efficient and
higher quality care. For example, provisions in the Affordable Care Act
designed to reduce health care acquired conditions and preventable
readmissions will both improve patient outcomes and reduce unnecessary
health spending. The Innovation Center, in coordination with private
sector partners whenever possible, will pursue new approaches that not
only improve quality of care, but also lead to cost savings for
Medicare and Medicaid. Rate adjustments for insurers participating in
Medicare Advantage will promote greater efficiency in the delivery of
care. Meanwhile, new rules for private insurers, such as medical loss
ratio standards and enhanced review of premium increases, will lead to
greater value and affordability for consumers.
Combating Healthcare Associated Infections: HHS will address
healthcare associated infections through the hospital value-based
purchasing program, as called for in the Affordable Care Act. In
addition, the FY 2012 Budget includes $86 million--of which $20 million
is funded through the Prevention and Public Health fund--to the Agency
for Healthcare Research and Quality (AHRQ), the Centers for Disease
Control and Prevention (CDC), and the Office of the Secretary to reduce
healthcare-associated infections. In FY 2012, HHS will continue
research on health-care associated infections and tracking infections
through the National Healthcare Safety Network. HHS will also identify
and respond to new healthcare-associated infections by conducting
outbreak and epidemiological investigations. In addition, HHS will
implement, and ensure adherence to, evidence-based prevention practices
to eliminate healthcare-associated infections. HHS activities,
including those that the Innovation Center sponsors and hospital value-
based purchasing, as called for in the Affordable Care Act, will
further the infection reduction goals of the Department's Action Plan
to Prevent Healthcare-Associated Infections.
Health Services for 9/11 World Trade Center Attacks: To implement
the James Zadroga 9/11 Health and Compensation Act, the FY 2012 Budget
includes $313 million in mandatory funding to provide medical
monitoring and treatment to responders of the September 11, 2001 World
Trade Center attacks and initial health evaluations, monitoring, and
treatment to others directly affected by the attacks. In addition to
supporting medical monitoring and treatment, HHS will use funds to
establish an outreach program for potentially eligible individuals,
collect health data on individuals receiving benefits, and establish a
research program on health conditions resulting from the World Trade
Center attacks.
Stabilizing Medicare Physician Payments: In December, the
Administration worked with Congress to offset the cost of legislation
preventing an imminent decrease in physician payment rates due to the
Medicare Sustainable Growth Rate (SGR) formula. The Budget goes further
and proposes to continue the current level of payment, and offset the
increase above current law for the next two years with specific
savings. Beyond the next two years, I am determined to work with you to
put in place a long-term plan to reform physician payment rates in a
fiscally responsible way, and to craft a reimbursement system that
gives physicians incentives to improve quality and efficiency, while
providing predictable payments for care furnished to Medicare
beneficiaries.
Advance Scientific Knowledge and Innovation
Accelerating Scientific Discovery to Improve Patient Care: The
Budget includes $32.0 billion for the National Institutes of Health
(NIH), an increased investment of $745 million over the FY 2010 enacted
level, to support innovative basic and clinical research that promises
to deliver better health and drive future economic growth. In FY 2012,
NIH estimates it will support a total of 36,852 research project
grants, including 9,158 new and competing awards.
Recent advances in the biomedical field, including genomics, high-
throughput biotechnologies, and stem cell biology, are shortening the
pathway from discovery to revolutionary treatments for a wide range of
diseases, such as Alzheimer's, cancer, autism, diabetes, and obesity.
The dramatic acceleration of our basic understanding of hundreds of
diseases; the establishment of NIH-supported centers that can screen
thousands of chemicals for potential drug candidates; and the emergence
of public-private partnerships to aid the movement of drug candidates
into the commercial development pipeline are fueling expectations that
an era of personalized medicine is emerging where prevention,
diagnosis, and treatment of disease can be tailored to the individual
and targeted to be more effective. To help bridge the divide between
basic science and therapeutic applications, NIH plans to establish in
FY 2012 the National Center for Advancing Translational Sciences
(NCATS), of which one component would be the new Cures Acceleration
Network. With the creation of NCATS, the National Center for Research
Resources will be abolished and its programs transferred to the new
Center or other parts of NIH.
Advancing Patient-Centered Health Research: The Affordable Care Act
created the Patient-Centered Outcomes Research Institute to fund
research and get relevant, high quality information to patients,
clinicians and policy-makers so that they can make informed health care
decisions. The Patient-Centered Outcomes Research Trust Fund will fund
this independent Institute, and related activities within HHS. In FY
2012, the Budget includes $620 million in AHRQ, NIH and the Office of
the Secretary, including $30 million from the Trust Fund, to invest in
core patient-centered health research activities and to disseminate
research findings, train the next generation of patient-centered
outcomes researchers, and improve data capacity.
Advancing Health Information Technology: The Budget includes $78
million, an increase of $17 million, for the Office of the National
Coordinator for Health Information Technology (ONC) to accelerate
health information technology (health IT) adoption and promote
electronic health records (EHRs) as tools to improve the health of
individuals and transform the health care system. The increase will
allow ONC to assist health care providers in becoming meaningful users
of health IT.
Improving Health Outcomes of American Indians and Alaska Natives:
The President is committed to improving health outcomes and providing
health care for American Indian and Alaska Native communities. The
Budget includes nearly $5.7 billion, an increase of $589 million over
FY 2010, which will enable the Indian Health Service (IHS) to focus on
reducing health disparities, ensuring that IHS services can be
supplemented by care purchased outside the Indian health system where
necessary, supporting Tribal efforts to deliver quality care, and
funding health facility and medical equipment upgrades. These
investments will ensure continued improvement to support the
Administration's goal of significantly reducing health disparities for
American Indians and Alaska Natives. Transforming Food Safety: The
Administration is committed to transforming our nation's food safety
system to one that is stronger and more reliable for American
consumers. This Budget reflects the President's vision of a safer food
safety system by including $1.4 billion, an increase of $333 million
over FY 2010 for the Food and Drug Administration (FDA) and the Centers
for Disease Control and Prevention (CDC) food safety activities.
Coupled with the enactment of the FDA Food Safety Modernization Act
(the Act), which was signed into law on January 4, 2011, HHS will
continue to modernize and implement an integrated national food safety
system. HHS plans to work with Congress to enact additional food safety
fees to support the full implementation of the Act. CDC will improve
the speed and accuracy of food borne illness outbreak detection and
investigation and FDA will focus on establishing preventive controls
for facilities and produce safety standards for farms in an effort to
avoid an outbreak of tainted food.
Preventing and Treating HIV/AIDS: The Budget supports the goals of
the National HIV/AIDS Strategy to reduce HIV incidence, increase access
to care and optimize health outcomes for people living with HIV, and
reduce HIV-related health disparities. The request focuses resources on
high-risk populations and allocates funds to State and local health
departments to align resources to the burden of the epidemic across the
United States. The Budget includes $2.4 billion, an increase of $85
million, for HRSA's Ryan White program to expand access to care for
persons living with HIV/AIDS who are otherwise unable to afford health
care and related support services. The Budget also includes $858
million for domestic HIV/AIDS Prevention in CDC, an increase of $58
million, which will help CDC decrease the HIV transmission rate;
decrease risk behaviors among persons at risk for acquiring HIV;
increase the proportion of HIV infected people who know they are
infected; and integrate services for populations most at risk of HIV,
sexually transmitted diseases, and viral hepatitis. In addition, the
Budget proposes that up to one percent of HHS discretionary funds
appropriated for domestic HIV/AIDS activities, or approximately $60
million, be provided to the Office of the Assistant Secretary for
Health to foster collaborations across HHS agencies and finance high
priority initiatives in support of the National HIV/AIDS Strategy. Such
initiatives would focus on improving linkages between prevention and
care, coordinating Federal resources within targeted high-risk
populations, enhancing provider capacity to care for persons living
with HIV/AIDS, and monitoring key Strategy targets.
Addressing the Leading Causes of Death and Disability: Chronic
diseases and injuries represent the major causes of morbidity,
disability, and premature death and contribute to the growth in health
care costs. The Budget aims to improve the health of individuals by
focusing on prevention of chronic diseases and injuries rather than
focusing solely on treating conditions that could have been prevented.
Specifically, the Budget includes $705 million for a new competitive
grant program in CDC that refocuses targeted disease-specific grants
into a comprehensive program that will enable health departments to
implement the most effective strategies to address the leading causes
of death. Because many chronic disease conditions share common risk
factors, the new program will improve health outcomes by coordinating
the interventions that can reduce the burden of chronic disease. In
addition, the allocation of the $1 billion available in the Prevention
Fund will improve health and restrain the growth of health care costs
through a balanced portfolio of investments. The FY 2012 allocation of
the Fund builds on existing investments and will align with the vision
and goals of the National Prevention and Health Promotion Strategy
under development. For instance, the CDC Community Transformation
Grants create and sustain communities that support prevention and
wellness where people live, learn, work and play through the
implementation, evaluation, and dissemination of evidence-based
community preventive health activities.
Preventing Substance Abuse and Mental Illness: The Budget includes
$535 million within the Substance Abuse and Mental Health Services
Administration (SAMHSA) for new, expanded, and refocused substance
abuse prevention and mental health promotion grants to States and
Tribes. To maximize the effectiveness and efficiency of its resources,
SAMHSA will deploy mental health and substance abuse prevention and
treatment investments more thoughtfully and strategically. SAMHSA will
use competitive grants to identify and test innovative prevention
practices and will leverage State and Tribal investments to foster the
widespread implementation of evidence-based prevention strategies
through data driven planning and resource dissemination.
Ensuring Safety and Improving Access to Medical Products: FDA is
charged with a significant task: to protect and promote the health of
the American public. To succeed, they must ensure the safety and
effectiveness of the medical products that Americans rely on every day,
and also facilitate the scientific innovations that make these products
safer and more effective. The Administration is dedicated to this
critical mission and the Budget provides $1.4 billion for FDA to
enhance the safety oversight of medical products, facilitate the
development of innovative products, and establish a pathway for the
approval of generic biologics thus allowing greater access to life
saving biological products that are safe and effective.
Pandemic and Emergency Preparedness: While responding to the 2009
H1N1 influenza pandemic has been the focus of the most recent pandemic
investments, the threat of a pandemic caused by H5N1 or other strains
has not diminished. HHS is currently implementing pandemic preparedness
activities in response to lessons learned from the H1N1 pandemic in
order to strengthen the nation's ability to respond to future health
threats. Balances from the FY 2009 supplemental appropriations are
being used to support recommendations from the HHS Medical
Countermeasure Review and the President's Council of Advisors on
Science and Technology. These multi-year activities include advanced
development of influenza vaccines and the construction of a new cell-
based vaccine facility in order to quickly produce vaccine in the U.S.,
as well as development of next generation antivirals, rapid
diagnostics, and maintenance of the H5N1 vaccine stockpile.
The HHS Medical Countermeasure Review described a new strategy
focused on forging partnerships, minimizing constraints, modernizing
regulatory oversight, and supporting transformational technologies. The
request includes $665 million for the Biomedical Advanced Research and
Development Authority, to improve existing and develop new next-
generation medical countermeasures and $100 million to establish a
strategic investment corporation that would improve the chances of
successful development of new medical countermeasure technologies and
products by small and new companies. The Budget includes $70 million
for FDA to establish teams of public health experts to support the
review of medical countermeasures and novel manufacturing approaches.
Additionally, NIH will dedicate $55 million to help shepherd
investigators who have promising, early-stage, medical countermeasure
products. Finally, the Budget includes $655 million for the Strategic
National Stockpile to replace expiring products, support BioShield
acquisitions, and fill gaps in the stockpile inventory. Strengthen the
Nation's Health and Human Service Infrastructure and Workforce
Strengthening the Health Workforce: A strong health care workforce
is key to ensuring that more Americans can get the quality care they
need to stay healthy. The Budget includes $1.3 billion, including $315
million in mandatory funding, within HRSA, to support a strategy which
aims to promote a sufficient health workforce that is deployed
effectively and efficiently and trained to meet the changing needs of
the American people. The Budget will initiate investments that will
expand the capacity of institutions to train over 4,000 new primary
care providers over five years.
Expanding Public Health Infrastructure: The FY 2012 Budget supports
State and local capacity so that health departments are not left
behind. Specifically, the Budget requests $73 million, of which $25
million is funded through the Prevention Fund, for the CDC public
health workforce to increase the number of trained public health
professionals in the field. CDC's experiential fellowships and training
programs create an effective, prepared, and sustainable health
workforce to meet emerging public health challenges. In addition, the
Budget requests $40 million from the Prevention Fund to support CDC's
Public Health Infrastructure Program. This program will increase the
capacity and ability of health departments to meet national public
health standards in areas such as information technology and data
systems, workforce training, and regulation and policy development.
Increase Efficiency, Transparency, and Accountability of HHS Programs
Strengthening Program Integrity: Strengthening program integrity is
a priority for both the President and me. The Budget includes $581
million in discretionary funding, a $270 million increase over FY 2010,
to expand prevention-focused, data-driven, and innovative initiatives
to improve CMS program integrity. The Budget request also supports the
expansion of additional Strike Force cities to target Medicare fraud in
high risk areas, enhanced efforts to achieve the President's goal of
cutting the Medicare fee-for-service error rate in half by 2012, and
funding to support implementation of a robust set of legislative
proposals to expand HHS program integrity efforts. The legislative
proposals are estimated to produce $32.3 billion in savings over ten
years.
In addition, the Affordable Care Act provides unprecedented tools
to CMS and law enforcement to enhance Medicare, Medicaid, and
Children's Health Insurance Program (CHIP) program integrity. The Act
enhances provider screening to stop fraudsters from participating in
these programs in the first place, gives the Secretary the authority to
implement temporary moratoria on enrolling new providers or suppliers
in fraud hot spots, and increases law enforcement penalties.
Additionally, the continued implementation of the Secretary's Program
Integrity Initiative seeks to ensure that every program and office in
HHS prioritizes the identification of systemic vulnerabilities and
opportunities for waste and abuse, and implements heightened oversight.
Implementing the Recovery Act: The American Recovery and
Reinvestment Act provides $138 billion to HHS programs as part of a
government-wide response to the economic downturn. HHS-funded projects
around the country are working to achieve the goals of the Recovery Act
by helping State Medicaid programs meet increasing demand for health
services; supporting struggling families through expanded child care
services and subsidized employment opportunities; and by making long-
term investments in health information technology (IT), biomedical
research and prevention and wellness efforts. HHS made available a
total of $118 billion to States and local communities through December
31, 2010; recipients of these funds have in turn spent $100 billion by
the same date. Most of the remaining funds will support a signature
Recovery Act program to provide Medicare and Medicaid incentive
payments to hospitals and eligible health care providers as they
demonstrate the adoption and meaningful use of electronic health
records. The first of these Medicaid incentive payments were made
January 5, 2011. As of March 31, 2011, 660 providers received $64
million in Medicaid incentives. More than 23,000 grantees and
contractors of HHS discretionary programs have to submit reports on the
status of their projects each calendar quarter. These reports are
available to the public on Recovery.gov. For the quarter ending
December 31, 2010, 99.6 percent of the required recipient reports were
filed timely. Recipients that do not comply with reporting requirements
are subject to sanction.
Conclusion
This Budget is about investing our resources in a way that pays off
again and again. By making smart investments and tough choices today,
we can have a stronger, healthier, more competitive America tomorrow.
This testimony reflects just some of the ways that HHS programs
improve the everyday lives of Americans.
Under this Budget, we will continue to work to make sure every
American child, family, and senior has the opportunity to thrive.
And we will take responsibility for our deficits by cutting
programs that were outdated, ineffective, or that we simply could not
afford.
But, we need to make sure we're cutting waste and excess, not
making across the board, deep cuts in programs that are helping our
economy grow and making a difference for families and businesses.
We need to move forward responsibly, by investing in what helps us
grow and cutting what doesn't.
My department can't accomplish any of these goals alone. It will
require all of us to work together.
I look forward to working with you to advance the health, safety,
and well-being of the American people. Thank you for this opportunity
to speak with you today. I look forward to our conversation.
______
Chairman Kline. We are getting updates on votes every few
minutes. It looks like the latest guess is around 10:30, so we
will start with questions and go until we get called to vote.
I know there are going to be a lot of questions about
health care, and I am tempted to jump in and start asking
those, but I want to go in a little bit different direction,
Madam Secretary. The most recent Head Start impact study says
that ``the advantages children gain during their Head Start,
and age 4 years, yielded only a few statistically different
differences in outcomes at the end of first grade for the
sample as a whole.''
Can you expand that at all? Have you been looking into
that?
And then, as a follow-on, I will just get them both out
there--again, the latest Head Start impact study states that
there was no strong evidence of impact on children's language,
literacy, or math measures at the end of kindergarten or at the
end of the first grade.
Can you tell us what you are doing to get at that? It is a
vexing problem we have been looking at for a long time.
Secretary Sebelius. Well, Mr. Chairman, I think that we
certainly share the goal of making sure that both the child
development and the early learning skills are focused on in all
of our child care and early education programs, and Head Start
is key among them. Early Head Start and Head Start continue to
show improvements in child development and in learning skills.
But how long they last into the school life continues to be
determined.
So we are continuing to take that information very
seriously, as I said in my opening statement, to revamp both
teacher training, to upgrade the quality standards, to make
sure that we are reanalyzing the curriculum, the core
curriculum in child care. But I think studies continue to show
that early learning programs do make a significant difference,
and 3-year-olds who spend a year in Head Start have a
significantly different impact when they go into grade school
than those who don't. What we need to do is continue that
progress once they hit school.
Chairman Kline. Let me follow up just a little bit. I think
that probably everybody on this committee has observed and
would agree that early learning is helpful.
But my question is specifically talking about Head Start
where the quote was, ``there was no strong evidence of impact
on children's language, literacy, or math measures at the end
of kindergarten or at the end of the first grade.'' So those
efforts that you are undertaking, I hope are focused and will
prove to be fruitful in Head Start, because I think we have
been disappointed many times that the Head Start program is not
really helping that many kids be ready for first grade.
Secretary Sebelius. Well, I would say, Mr. Chairman, we
have an unprecedented effort underway right now with the
Department of Education, where we are working closely with them
to kind of align standards to make sure that the early
childhood programs run by the education system have the
developmental aspects that I think have been a component of
Head Start, and that the Head Start programs have the
curriculum-based component that often were more focused on in
the education programs.
We think that regardless of where a parent chooses as an
appropriate out-of-home placement for their child, whether it
is child care or Head Start or Early Head Start or a public
pre-K program, we should have the same goals and the same
alignment of initiatives.
So we are taking those issues very seriously. We think
school readiness has to be an important component of Head
Start, and we continue to upgrade the programs.
We are also recompeting programs that have the lowest 25
percent of the impact on children. We think that is an
important aspect, to make sure that we continue to drive
improvements and not just continue to fund programs because
they have historically had funding.
Chairman Kline. Thank you.
I am going to move to another subject quickly. Your Agency
administers the early retiree insurance program, which provides
money to employment-related retiree benefit plans. An HHS
report dated March 31, 2011, said the program which was
supposed to last until 2014 had already spent $1.8 billion and
is not accepting new applications as of the end of April.
This is troubling on a number of levels. I would like to
know if it is true that one plan sponsor, the United Auto
Workers Retiree Medical Benefits Trust, received $207 million,
or 11.5 percent of the total amount paid by the program?
During the plan approval process, did this plan have to
demonstrate or prove that it needed taxpayer funding to pay
claims to maintain solvency? I have another number of questions
relating to this, but I think you can see the point; we are
concerned how the decisions are made or how this money is
awarded. Can you address that specific question?
Secretary Sebelius. I would be glad to, Mr. Chairman. I
can't answer with specificity about the UAW plan. I will be
glad to give you the written answer to that.
Chairman Kline. Would you, please?
Secretary Sebelius. I just don't have those facts off the
top of my head. But this program has been enormously both
popular and helpful, I think, to those companies and programs
who wanted to continue their early retiree coverage. We have
seen employers consistently dropping that coverage over a
period of time and, in fact, one of the largest growing groups
of uninsured in America were the 55 to 65 years old who had
retired early, and they and their spouses often lost that
employer-based coverage when those plans got too expensive.
This program was widely advertised, announced. There was a
process where applications were accepted universally. They had
to present documentation to our office. It wasn't our office
picking and choosing who got in. The programs qualified if they
met the statutory qualifications. And the way this works, Mr.
Chairman, is individual claims are presented that rise above
the threshold. So it is a stop-loss policy, if you will, for
early retiree programs.
The most expensive claims are presented and they are paid.
We share 80 percent of those costs. So we give employers some
ability to predict their costs going forward, and that has
actually stabilized the early retiree plan. So plans are not
being paid from a presumptive pipeline; we are actually paying
after the fact, as claims are being presented. And we would be
happy, again, to share the documentation of how that is
working. It is paid at 6 months. After the claim is made, they
come in and the money goes out the door.
Chairman Kline. Okay. I will present some questions for the
record.
Secretary Sebelius. Sure, be glad to.
Chairman Kline. The example looks like we are going to run
out of money. And have you requested that money in the
Presidents's budget and so forth? I will present those for the
record.
Secretary Sebelius. I would be glad to answer that.
Chairman Kline. I recognize Mr. Miller.
Mr. Miller. Thank you very much. Just on the chairman's
earlier discussion on Head Start, I don't know the study he is
referring to, but I know on previous studies the question that
had to be requested was what was the quality of the program the
child was entering into in kindergarten or first grade?
We know that many of these children and, unfortunately, the
poor performing schools, the poorer schools in our country,
they can lose a whole year over the summer. And so the idea
that--you know, it is what do you follow on with after Head
Start that has to be determined. But I would be glad to look at
the studies. But I know in the past that has been a significant
impact on what happens to children afterwards.
I want to turn to part of the the Affordable Care Act that
I had a chance to participate in in my district last month, and
that was the Partnership For Patients Initiative, which is
really about, as I witness this, is this is an effort to try to
reduce medical errors to improve care, to stop the accidents
that take place, improve the sanitary nature of a hospital,
from washing your hands to a whole range of things that were
popularized, I think to some extent, by Gawande, and making of
the list before surgery and what you should be thinking about
when you are doing that.
I was quite surprised at the range of support for this
program from the Chamber of Commerce, the Business Roundtable,
that after the event the profits, the nonprofits, and public
facilities all wanted to say how do we get to participate in
this? And in the San Francisco Bay area, it is quite an array
of hospitals, from the most successful nonprofits to a Kaiser
system of a prepaid nature and then the public facilities.
My understanding is that there is about 90--somewhere, 95-
98,000 people who die in the care of hospitals or shortly,
thereafter as a result of errors and mistakes that are made; in
the facility that we visited, a question of hand-washing all of
the time as you move from room to room and from facility to
facility.
They had a simple plan of putting bright red tape behind
the head of the bed so that those who are on respiratory
assistance, or the bed is kept at 30 degrees, a dramatic
reduction in pneumonias in that facility. People who are
susceptible to slips and falls now have to wear very bright red
socks and slippers so that people are aware of that. Slips and
falls have gone down about 50 percent. It has just ricocheted
through the system in terms of the improvement in the outcomes
in that facility.
I think your Agency has said that we look for a savings
down the road of about $50 billion under this initiative, but
it is very clear from people who are paying the bill, the
employers and others who are participating in this, that there
is a pretty big bet being placed on improving these outcomes.
There was a piece in the Wall Street Journal last week that,
even with all of the admonishment, as medical staff moves from
space to space, there is--over a vast majority of them are
still not washing their hands.
Those of us who have visited the veterans at the veterans
facility know every time you move between one space to another,
whether you have touched anything, you have to go through the
sanitizing of your hands as you move around that facility.
And I would just like your comments on this because this
seems to me, given the people who are rushing forward to say we
haven't yet been able to participate, who want to participate
in this program.
Secretary Sebelius. Well, Congressman Miller, we have had
enormous enthusiasm and excitement, as you have indicated,
across the range of not only health care providers but
employers, business groups, patient advocates. We do have about
100 deaths a year, but hundreds and hundreds of thousands of
people are injured. And, in fact, the most recent study said
that one out of every three Americans who goes into a hospital
is injured by care that they receive in the hospital.
That is a very large number and it not only causes enormous
injury and death, but it costs an enormous amount of money that
we shouldn't be spending.
In the past, Medicare has been a volume purchaser. So
whether the hospital had a 60 percent infection rate or 0
percent infection rate, you basically got paid the same way.
The Affordable Care Act gives us a framework to actually
begin to head in a very different direction, to use the
enormous payment system of Medicare and Medicaid to be a cost-
driver to encourage value instead of volume. And we are taking
that very, very seriously. So the Partnership for Patients has
two very, very aggressive goals. Reduce hospital-based
infections by 40 percent over the next 3 years. The ultimate
goal is zero. We shouldn't be hurting people when they have to
go to the hospital. That has to be our goal.
Also, reducing unnecessary hospital readmissions by 20
percent over the next 3 years. And those goals are achievable
because there are pockets of that care going on right now in
the country. So we are going to be providing technical
assistance, be sharing best practices, helping to encourage.
But, as you say, we currently have over a thousand
hospitals who have signed up. We have employer groups, we have
patient advocate groups, a range of partners. And, frankly, the
private sector is enormously enthusiastic. They have been
trying to do this for years, but they don't have enough juice
in the system. They can't touch every hospital with their
purchases.
So joining together on quality outcomes not only improves
care for Americans, but dramatically lowers cost and it--you
know, we have two ways to lower the rising costs in Medicare.
It is improving care and getting a better bang for our buck and
lowering costs that way, or just cutting off benefits. And I
think the Partnership for Patients gives us a real pathway to a
new kind of delivery system change.
Mr. Miller. Thank you. Thank you, Mr. Chairman.
Chairman Kline. I thank the gentleman. Dr. Foxx, you are
recognized.
Ms. Foxx. Thank you, Mr. Chairman. Thank you, Secretary
Sebelius, for being with us.
I was interested in hearing what Mr. Miller was saying, and
talking about all these wonderful things that have happened
over using common sense. Just what is astonishing to me is that
it has taken so long for the Department to be able to put in
commonsense issues like this.
It seems the Federal Government doesn't often care about
costs until our backs are against the wall, and we ought to be
caring about costs every day in every program. There should be
accountability in every program every day, and it is
disappointing to someone like me who cherishes common sense,
that it has taken so long to get to this point.
But let me get to my question now. I find it really
interesting, Madam Secretary, that you and the President said
over and over and over and over again that if you like it, you
can keep it. You promised the American people that if they had
health care, health insurance, that they could keep what they
had.
But we now know that, although you promised people to be
able to be grandfathered in, the regulation that you published
last year found that 60 percent of employers and 80 percent of
small employers will lose their grandfather status by 2014. So
what you said wasn't true because you have established
regulations that were not in the law to guarantee that people
can't keep their health insurance.
So how do you reconcile what you promised with what you
have put into effect, and the fact that that is going to cost
so much more money as a result of it?
Secretary Sebelius. Well, Congresswoman, I first of all
share your concern that common sense doesn't always drive
policy.
The error report came out 10 years ago indicating we had a
serious safety problem and, frankly, no one paid a lot of
attention to it in the Medicare agency. And I am pleased that
finally the the Affordable Care Act presented the platform to
allow us to have the kind of regulation in place that moves in
a brand-new direction.
In terms of the insurance market, as you know, employer
participation in the market is voluntary, and small business
owners, and particularly individuals, move in and out on an
individual basis. And you are absolutely right; the law doesn't
mandate that employers who had a policy in place in 2010, when
the bill was signed, must keep that policy in place. That is
not part of the law, so they still have free will and free
choice.
What we did do was create a platform that said basically if
you keep essentially the same kind of benefit package, if you
don't shift a huge amount of costs onto your employees, if you
don't dramatically cut the kinds of benefits that your
employees now are able to access, then you are grandfathered in
under the plan.
And so it is really an employer choice whether or not the
grandfather status is going to meet them on into the future or
not. That is really the way the private market works. The
employers come in voluntarily. They may or may not provide
coverage.
We are seeing actually, I think, some good news where small
employers are beginning to reenter the market for the first
time in a very long time. We were on a trajectory where if you
work for a small company--and I certainly saw this as an
insurance commissioner in Kansas, and I heard about it over and
over again when I was Governor of Kansas--that the most
vulnerable people in the marketplace were folks buying
individual coverage and folks, farm families, and small mom-
and-pop shops who were in the small group market. And that
market is beginning to stabilize, and I think that is very good
news.
Ms. Foxx. But, Madam Secretary, why don't you just leave
free choice out there, period? It would be up to the employers
to decide what they can afford to do and it would be up to the
employees to decide whether they want to go on the private
market themselves. Why not allow that free choice?
You all on your side of the aisle have very limited issues
on free choice.
Secretary Sebelius. Well, I think, again, the platform of
the the Affordable Care Act, Congresswoman, is that employers,
particularly in the small market, have to look forward to a
new, competitive, lower-cost marketplace. According to the
Congressional Budget Office, they will have choices and the
costs for those premiums will go down. They currently have very
limited choices in the marketplace and often pay 18 percent to
20 percent more than their large competitors just because of
the size of their companies. So they will be in a large pool,
they will have some choices.
Individuals also will be able to purchase coverage and have
some assistance purchasing that coverage if they are lower-wage
workers if they don't have access to employee coverage.
So we have a market that will be framed by States around
the country. That doesn't exist right now and gives a lot more
choice and a lot of cost relief to the most vulnerable folks in
the marketplace.
Chairman Kline. Thank you. Mr. Kildee.
Mr. Kildee. Thank you very much.
Madam Secretary, Head Start, when it was first authorized
in 1965, placed the program in HHS rather than the Department
of Education, because it was more comprehensive than just
education, to include health and other social skills, among
others. I was chief sponsor of the 2007 reauthorization of Head
Start and we tried to enhance those purposes that we first put
in in 1965.
How has the fiscal year 2012 budget helped you in your
efforts to bring these programs, integrate them together, the
various purposes, beyond the purpose of education in the Head
Start program?
Secretary Sebelius. Well, Congressman, I think that the
President certainly shares your belief that Head Start is a
very important component of an early childhood framework for
America, and that is why he has proposed an increase in Head
Start funding as we move forward and the ability to serve
additional children.
I think also the notion that we have a very exciting
opportunity with the passage of the 2011 framework, the Early
Learning Challenge Fund, which will be housed in the Department
of Education but participated in by HHS and Education, which
actually is a kind of a mirror of ``Race to the Top'' for early
childhood education, driving quality initiatives, aligning the
kinds of standards and giving States the opportunity to really
innovate in early childhood education.
And what we are seeing around the country is that Head
Start is no longer operating in a silo, but many Governors have
put together broad-based early education Cabinets where the
Head Start folks are very much at the table with the early
childhood education folks, with the child care folks, which was
almost unprecedented. And I know I did that, again, when I was
in Kansas, but that is a mirror of what is happening.
I think the integration of developmental skills, one of the
features of Head Start that I think is very critical, that
again needs to be incorporated into a lot of early childhood
programs, is involvement of parents. There is a significant
parental aspect to Head Start, where they participate in a
child's education at the earliest point and hopefully that
continues on.
So there are a number of components which not only look at
school readiness, but look at the whole developmental readiness
of the child, that we are trying to improve and actually share
with our partners in the education system.
Mr. Kildee. Thank you very much, and I encourage you to
encourage the Governors and those in the States to continue to
do that. Thank you very much.
Chairman Kline. The gentleman yields back.
I am going to recognize Dr. Roe in about 3 seconds. And for
everybody's information, his will be the last question as we
head for the floor to vote. I am just alerting all the members
of the committee.
Dr. Roe, you are recognized.
Mr. Roe. Thank you, Madam Secretary, for being here today
and to let you know that my background is a physician
practicing in Tennessee where we had an experiment with an
expansion of our Medicaid program.
And the first question I have is how many people will the
Affordable Care Act cover, do you estimate right now, it will
cover?
Secretary Sebelius. How many new people?
Mr. Roe. Yes.
Secretary Sebelius. The estimates are in the 30 to 35
million range.
Mr. Roe. And it looks like that most of this expansion of
coverage is just an expansion of Medicaid.
Secretary Sebelius. Doctor, the data that I have seen, it
is estimated about half and half. About half will be exchange-
eligible and about half will be Medicaid-eligible. So about 15
million are likely to be Medicaid-eligible.
Mr. Roe. Well, what CMS says is that 24.7 million will be
added, an increase of 5 million, and these are Medicaid. And
this is not me, this is CMS.
And CBO estimates 8 million more than we had thought. Do
you agree with those numbers, what CMS said, or what the CBO
said about their estimates?
Secretary Sebelius. Again, the numbers that I am familiar
with are about half and half. So I am not quite sure what you
are looking at or quoting.
Mr. Roe. I will send some----
Secretary Sebelius. Maybe who is uninsured; and there are a
portion of uninsured that aren't assumed to be fully insured. I
mean, I don't know.
Mr. Roe. Well, I will get those in written form to you.
Secretary Sebelius. Okay, thank you.
Mr. Roe. Do you think this bill is simple or is it complex
to understand, and have you read the whole bill?
Secretary Sebelius. I have read the bill. I think it is
very comprehensive because it deals with all aspects of the
health care system.
Mr. Roe. Let me get down to just some practical aspects of
it.
I have a practice that has about 350 employees, primary
care doctors. We insure about 300 of them, and everybody is
eligible, and we have done that for 40 years in our practice,
very proudly have provided health insurance coverage,
retirement, and so forth. Right now we pay about $5,500 per
employee, or somewhere--it may be up to 6,000, I haven't seen
the numbers for this year.
If someone goes to the exchange and we decide to pay the
$2,000 penalty, we save ourselves and our practice a million
dollars. That is one little business.
Another business in Tennessee that I have seen and talked
to those folks, because we don't know what--I know someone, and
this is another question I am going to have, is who defines
what affordable care is, what is that, and what is in the
package? This company will spend, they think, 40 million more
dollars in their business, complying with these new
regulations, or they can save $40 million by having those folks
get their health insurance through the exchange.
Now, we had a very good presentation--and you probably
should read this from the Lofton Group. Mr. Brewer came in, the
president of Lofton Group, and went over case example after
example about why that will happen. So why wouldn't I do that
under this situation? And like he said, most of his clients
told him, I am not going to be the first to do this, but I am
not going to be third.
And, finally, what is going to happen is, you are going to
have a debate between the chief financial officer and the HR
people. I have done it around the table and find the chief
financial people win.
So tell me why that is not going to happen?
Secretary Sebelius. Well, I think, Congressman, one of the
things that assumes is that there is no advantage to a business
owner for keeping great employees and tying those employees to
the health insurance plan. And what we see right now is a
voluntary marketplace where people have entered voluntarily.
Your premise is based on the fact that that employer, you in
this instance, or someone else, drops all employer coverage.
Mr. Roe. But if you had--if you were over 200 employees
now, which we are, almost all of them provide health insurance
coverage right now. And as you see reimbursements, especially
in our business with Medicaid going down and with Medicare--I
hope I have time to get into Medicare--why wouldn't I do that?
Secretary Sebelius. Well, again, I think that the exchanges
are particularly being designed for small employers. You, in
the instance of having the number of employees that you are
talking about, are likely to be banned from initially entering
the exchange because of the----
Mr. Roe. With all due respect, they can.
Secretary Sebelius. Pardon me?
Mr. Roe. They can. I mean, I have read this. We can do
that. If one person goes in there and we decide to drop--
anyway, that is fine. I am not going to get an answer.
The other question I have is Medicare I am particularly
worried about because health care decisions, I believe, Madam
Secretary, shouldn't be made here in Washington, D.C. They
should be made between patients and their families and their
doctors, not by insurance companies and not the Federal
Government.
Secretary Sebelius. I absolutely agree.
Mr. Roe. And my concern is we have just taken $500 billion
out of an already underfunded Medicare plan, and your number is
3.5, 3.3 million people we are adding per year, that is another
30, 35 million in the next 10 years, with $500 billion less.
How does that math work?
Secretary Sebelius. Well, Congressman, as you have probably
recognized, the $500 billion is a reduction in the growth rate
of Medicare from what is estimated to be about 7.8 percent to
closer--to over 6 percent. So it is not taking money out of the
program, it actually is trying to slow down the cost growth
without changing any of the guaranteed benefits. And, indeed,
there are additional guaranteed benefits.
I would suggest that the House-passed budget, the House
Republican budget that suggested that vouchers are the
appropriate goal for Medicare, and turning over Medicare
patients to the private insurance market does nothing but shift
enormous cost onto seniors in this country. You put an
insurance company between them and their doctor.
Chairman Kline. Madam Secretary, I hate to interrupt. Dr.
Roe, the clock is demanding here. We--the committee is in
recess.
[Recess.]
Chairman Kline. The committee is called back to order.
By agreement with my colleagues, we are going to resume. I
understand Mr. Miller will be joining us shortly, but I
recognize Mr. Andrews for 5 minutes.
Mr. Andrews. Thank you, Mr. Chairman, and welcome, Madam
Secretary, to the committee. It is very, very wise, Madam
Secretary, to be listening to Chiquita. I would too. She is a
very able and wise young lady; and from the right State, I
might add.
Madam Secretary, one of the topics of the moment for the
country is Medicare and how we should respond to the long-term
bargain our country made with our seniors and persons with a
disability in 1965. And that bargain, of course, was when the
person retires or is adjudicated to have a disability, they
will be guaranteed medical benefits, they will be guaranteed
the choice of their own physician, and Medicare will pick up
the lion's share of that bill.
And that is a system that I think has worked very well for
this country for a very long period of time.
As you know, there are proposals that would, in my view,
end that system. It would say to people 55 years and under that
they are going to be into a very different system that is
essentially a subsidy, an inadequate subsidy to buy private
health insurance.
A report that Mr. Miller spoke of earlier indicates that if
one takes the gap which the Congressional Budget Office has
identified between the premium support that the Republican plan
would offer and the real out-of-pocket costs for health care
for retirees and seniors, it would be about $6,000 a year; and
for a senior to have enough money to cover that gap he or she
would have to save nearly $200,000 out of their pocket before
they retire.
One interesting point of reference is that the average
401(k) balance for a person when they retire in this country is
a little less than $100,000 a year. So what that means is if
you are a senior under the Republican Medicare plan, at least
the one that existed until yesterday, and you emptied your
401(k), it would only make up about half of what you need to
pay your out-of-pocket health care bills, additional out-of-
pocket health care bills because of the Republican plan.
Now I know that before you came here your experience as
Governor back in Kansas generally gave you the opportunity to
be an insurance market regulator. I wonder if you could tell us
what you think would happen--in addition to this financial
disaster, what you think would happen to people 65 and over and
people with a disability if they were thrown into the private
insurance market with this kind of inadequate subsidy? What
would that mean to a senior citizen or a person with a
disability?
Secretary Sebelius. Well, Congressman, I have seen the same
analysis that you have.
First of all, Medicare as a program has one of the lowest
administrative costs of any health program I would suggest in
the world. So we know that, according to CBO, according to any
economist, that the administrative costs of an average health
insurer are significantly higher. So you take the same amount
of dollars and you have less buying power if you are doing it
through the private market than you do through Medicare.
Secondly, to have a fixed dollar amount, as opposed to
guaranteed benefits, I think is, as you suggest, a very
different kind of commitment to seniors and leaves an enormous
cost shift on to seniors and those with disabilities.
Mr. Andrews. If I could just interrupt for a minute, what
might that cost shift and lack of guaranteed benefit mean for
an oncology patient or a person with cancer? Give me an example
of what it might do there.
Secretary Sebelius. Well, I think there is no question, if
you take a snapshot, people will run out of money very quickly.
And if you run out of the government voucher and then you run
out of your own money, you are really left to scrape together
charity care, go without care, die sooner. There aren't really
a lot of options.
But it is estimated according to the CBO analysis that by I
think it is 2030 you would have about 70 percent of the cost of
medical care shifted onto individuals. A pretty dramatic--right
now, it is about 25/75, and that would flip pretty
dramatically. And most people--a number of people, working
families and others, don't have the wherewithal to come up with
that kind of cash, particularly in their later years when they
are likely to have more serious and more expensive care.
Mr. Andrews. It is true, isn't it, that the Republican plan
that was adopted by the House majority about 2 weeks ago really
isn't a cost reduction plan, it is a cost shifting plan, that
as health care costs go up, seniors pay more and Medicare goes
away?
Secretary Sebelius. I think the combination of the votes on
repealing the Affordable Care Act, which would not only get rid
of the new tools we have to crack down on fraud and abuse but
limit the closure--eliminate the closing of the donut hole, go
after some of the new guaranteed benefits, combined with the
voucher program, would basically destroy the commitment to
ongoing health care.
As you say, one of the promises made in 1965--and a little
personal anecdote--my father was actually on the Energy and
Commerce Committee serving in Congress and helped write the
Medicare law. He just had his 90th birthday, and he is pretty
happy with those benefits right now.
Mr. Andrews. We will tell Mr. Dingell that.
Secretary Sebelius. Well, he served with Mr. Dingell, and
he knows Mr. Dingell.
Chairman Kline. So do we all.
Secretary Sebelius. Indeed. But I think it is a very
different kind of commitment that we would be making to 55-
year-olds about their future in the United States.
Mr. Andrews. Thank you, Madam Secretary.
Chairman Kline. I thank the gentleman.
Mr. Walberg, you are recognized.
Mr. Walberg. Thank you, Mr. Chairman; and thank you for
joining us, Madam Secretary.
As you may probably may already know, since 1992 the
National Institute for Occupational Safety and Health and
National Cancer Institute have been working on a study that
determined the potential health affects of diesel exhaust on
miners. Members of the mining industry voluntarily provide
NIOSH with access and information to conduct this study.
Initially, NIOSH agreed to share data with the companies
and volunteered access and information. However, since that
time, NIOSH has not honored that agreement on more than one
occasion. As a result, Federal judges twice ordered NIOSH to
share these materials with the concerned parties, which include
this committee. Yet full compliance has yet to be seen. And so
the questions I would ask, I would like to know why NIOSH has
not complied with these orders of two Federal judges and would
also like to know what assurances you can give me that the data
will be released as required by the courts. In other words,
basically, do you want NIOSH to comply?
Secretary Sebelius. Well, Congressman, I must confess I am
not familiar with either the studies that were done or the
Federal cases, but I will commit to you that I will learn about
them quickly and work with you to get you the information that
you have requested. I just can't respond about why they haven't
done it. I am not--I wasn't aware that they had not, but it
will be something that I will----
Mr. Walberg. But if the court has ordered this, I would
hope I could conclude that you would want them to comply.
Secretary Sebelius. Well, as I say, Congressman, I am not
familiar with the situation. I will get very familiar with the
situation, and I will get an answer back to you quickly.
Mr. Walberg. I appreciate that.
Secretary Sebelius. Yes.
Mr. Walberg. Moving back to the Chairman's lead-off
questions with Head Start, last year, the U.S. Government
Accountability Office conducted an undercover investigation of
15 Head Start programs, acting in response to tips from former
and current employees at two separate Head Start centers.
Undercover GAO applicants tried to enroll children in these
programs and presented the centers with pay stub data that
demonstrated they were above income eligibility requirements.
Nine of the 15 sites enrolled the students anyway by
encouraging applicants not to submit the pay stubs that would
put them over the income threshold. Some of the programs
continued to count students as enrolled, even though the
students never actually participated in the program.
At a May, 2010, hearing before this very committee, the
Assistant Secretary for Children and Family stated that the
Department was taking immediate corrective action and was
undertaking a top-to-bottom review of its program oversight
responsibilities. So the questions I would ask are these: Can,
first, you give us an update on the Department's effort to
combat waste, fraud, and abuse in the Head Start program? And,
secondly, how many unannounced monitoring visits has the
Department conducted since the release of the GAO report?
Secretary Sebelius. Congressman, I, first of all, want to
tell you that I share your dismay at the GAO report and, more
than the GAO report, the practices that were under way; and we
do take program integrity very seriously. In fact, I have for
the first time created a Secretary's Program Integrity Council
which operates across all of our agencies and departments to
try and actually get out ahead of any practices, any lax
oversight, any issues that we should know about.
We did very quickly go into--first of all, we have had, I
think I was told yesterday, 160 unannounced visits, to answer
your question with some specificity; and those are ongoing
efforts to make sure we are complying with that. We have
conducted retraining of Head Start directors, we have issued
new guidance on compliance with program integrity and
guidelines, and reminded people about their legal
responsibilities.
We are recompeting, as I say, the--we put out a rule about
recompeting the lowest 25 percent of the program. We are
conducting overall reviews and ongoing training initiatives.
But we are taking this very seriously, reminding people that
these are taxpayers' dollars and being used to educate some of
our must vulnerable children, and we want to make sure that
that is exactly where the dollars go.
Mr. Walberg. I appreciate that, and we will look forward to
receiving fuller information on that. In a time of vanishing
dollars for our education systems in my State as well as your
State we can't suffer this to take place, so thank you.
Secretary Sebelius. I agree.
Mr. Walberg. Thank you, Mr. Chairman.
Chairman Kline. I thank the gentleman.
Mr. Payne.
Mr. Payne. Thank you.
Let me commend you on the outstanding job you are doing.
I think one thing we need to keep in mind is that it is
great that the United States of America has moved into the
nations around the world of developed countries to provide
universal health care. As you know, we were one of the only
developed countries in the world that did not provide it.
Let me just say about Head Start, we know it is a vital
program. It helps to level the playing field for low-income
preschoolers and improve academic outcomes. We know there are
some problems striving towards a more perfect union, so to
speak.
In your testimony, you mentioned the Department's endeavor
to strengthen the Head Start program, and I commend you for
efforts as well as your continued support of childhood
education in fiscal year 2012 requests.
Our Republican colleagues propose a $690 million cut to
Head Start this year, as you know, which would have removed
130,000 low-income children and families from the program,
closed 10,000 Head Start classrooms, and laid off 33,000
teachers and related staff. This measure is contrary to our
goals of increasing employment and strengthening educational
outcomes. Thankfully, this measure did not become law.
And our children, like a little fellow named Matthew in my
district, sent me a constituent letter saying, Dear
Congressman, it's my future, hands off Head Start funding. As a
matter of fact, little Matthew had his little hand print to
just keep your hands off our funding, so I have to have a
meeting with him. I hope he doesn't come to a town hall meeting
to run me out of the place.
So we know that it is a very important, and so I really
commend the administration and support your fiscal year 2012
budget.
Let me just say, in addition to proposing cuts for
Medicaid, my Republican colleagues supported a spending plan
that would turn Medicaid into a block grant program. Medicaid
provides health care for the most vulnerable population--the
elderly, disabled, children, low-income adults. Madam
Secretary, can you explain the impact of this action? Would it
have become--had other beneficiaries in the States if it had
gone into effect?
Secretary Sebelius. Well, Congressman, our analysis of the
budget proposal is that, as you know, not only does it propose
a block grant but there is a significant and very dramatic
decrease in the funding level. So it is a fixed cap that
decreases over time. And, frankly, again as a former Governor
who administered a Medicaid program, one of the things that you
can't anticipate is 2 years out what the economic downturn is
going to do.
So just a little bit of hindsight, if we had had a block
grant in place for Medicaid recipients over the last number of
years and the increase in services needed based on the number
of people who lost their jobs, lost their health care, needed
reliance on that, I think most States would have been in a
very--a more dire situation than they are right now.
As you know, the vast majority of the Medicaid population
are children. The most expensive part of the population are
older Americans who are poor enough to qualify for Medicare but
often are in nursing homes. And you don't have a lot of--the
people don't go away when the money goes away.
So I have met with mayors and some governors and county
supervisors and others who find this proposal to be very
alarming, because they will still deal with folks coming
through the doors of emergency rooms without care. They would
be dealing with people in nursing homes without the support
that Medicaid currently provides for that very critical nursing
home care.
What we think is a much more strategic way to deal with
this is 5 percent of the Medicaid beneficiaries account for
about 50 percent of the cost. They are the most chronically
ill, often disabled. Many of them are getting very erratic
care. They are often in two systems, Medicare and Medicaid, at
the same time. And we are working very closely with States and
with a proposal that is going to come out of our new center for
innovations that will focus on the so-called dual eligibles and
give States a lot of flexibility of using the best possible
practices to coordinate care and actually drive those costs
down. If we can cut those costs by 10 to 15 percent, States
will save billions of dollars; and the Federal Government,
frankly, will save billions of dollars.
Mr. Payne. Thank you very much. I don't know if I have time
for another question. It is still on yellow.
Well, during the debate on H.R. 1, Republicans adopted nine
riders intended to block implementation of all or components of
ACA. If enacted, these amendments would have brought
implementation of the ACA to a halt, eliminated benefits that
people throughout the Nation are already enjoying, including
many of my Republican colleagues and constituents. Can you
quickly mention some of the benefits that already have been
experienced as a result of ACA?
Secretary Sebelius. Certainly, Congressman. I mentioned the
children with pre-existing health conditions, which I think is
a huge step forward for families who have been struggling with
that, being locked out of the insurance market for years. We
have already seen the reports of just the last month are that
hundreds of thousands of young adults are now covered. One of
the most uninsured populations in the United States is now
coming into the marketplace, thanks to the provision that
allowed young adults to stay on a family policy for an extended
period of time.
We know that seniors are beginning to get relief from their
prescription drug benefits. A number of them got the one-time
$250 check, but this year they will have a 50 percent decrease
that is going into affect; and, at the same time, they are
experiencing lower rates on Medicare Advantage plans, thanks to
the negotiating power that the ACA provided for us.
There is a new bill of rights for patients that ensures
that new plans have preventive health care, that new oversight
powers for State insurance departments to do rate reviews, the
medical loss ratio goes into effect this year. So $0.80 of
every health care dollar has to be spent on health costs and
not overhead and CEO salaries. Those are just kind of snapshots
of what is beginning to be under way. The preexisting condition
plan, where we now have 18,000 Americans who had been locked
out of the market are now able to buy market-based coverage and
really often in life-saving situations.
Mr. Payne. Thank you.
Chairman Kline. The gentleman's time has expired.
Dr. DesJarlais, you are recognized.
Mr. DesJarlais. Thank you, Mr. Chairman.
Secretary Sebelius, thank you for being here today.
Like my colleague from Tennessee, I am also a physician.
Prior to coming to Congress in January, I practiced primary
care medicine for the past 18 years in Tennessee and was also
witness to the failed attempt at a government-run model in the
State or Medicaid program, was known as TennCare. I would love
to discuss that, but I think right now what is on a lot of
people's minds is the issues with Medicare. So I would like to
start with that.
Would you agree that Medicare is an example of government-
run health care?
Secretary Sebelius. Congressman, Medicare provides for----
Mr. DesJarlais. Yes or no on that one. Is it run by the
government?
Secretary Sebelius. Yes.
Mr. DesJarlais. Okay. Are you in agreement with my
colleague across the aisle that said Medicare has been doing a
great job for many years now, 40 plus years?
Secretary Sebelius. I think it has delivered essential
benefits to seniors for 40 plus years, yes, sir.
Mr. DesJarlais. I just want to share a few concerns that
have been brought forth to us in the past few months.
One of great concern is that the CBO has estimated that the
program will be bankrupt in 9 years if left unchanged. So when
we get challenged that our attempts to make changes to this
program to secure it and protect it for future generations,
sometimes I take issue with that.
Also----
Secretary Sebelius. You know, Congressman, the slowdown and
the cost grow was estimated to add a number of additional years
onto the Medicare trust fund. That was provided by the ACA.
Mr. DesJarlais. We are going to get into that, because we
are going to talk about slowdown and cost grow. But, also, as
you stated, we are entering 9,000 new members into the Medicare
program each day or roughly 3.3 million per year. So we are
greatly expanding the program, and we are talking about
bringing down costs. And it is obvious this is a great thing.
Just back from the '70s you all remember the average life
expectancy was much less. We are all living 10 years longer
than we were just a few years ago. But that also has to be
accounted for. We have to pay for that. That has been
occurring. Baby boomers, as we mentioned, are coming through
the program now. So we have huge volume issues.
Also, it is noted that right now that an average family,
average couple that makes about 43,000 a year per person has a
Medicare tax liability over a lifetime of approximately
$100,000. But yet the average utilization for the same couple
is about $300,000, so we have a 3 to 1 ratio there. And all
those things kind of point towards disaster, especially when we
talk about bringing more people in, yet we are going to reduce
cost and somehow we are going to maintain quality of care.
What would be your concerns, based on those facts I just
gave you.
Secretary Sebelius. Well, I think that there are ways that
certainly health care providers have suggested that we can
reduce costs, not tamper with the guaranteed benefits, and
deliver better care at the same time. And that is really the
strategy of looking at the underlying rise in health care
costs. Whether it is Medicare or the private insurance market
or somebody whose paying out-of-pocket, the trajectory of
health care costs, paying more for everything that we are
doing, continues to rise at well above the rate of inflation.
And yet, as you know, Doctor, in the United States our health
results don't show that kind of expenditure. We are not getting
the kind of health results we should get. So I think there are
all the kinds of delivery systems.
Congressman Miller mentioned just one----
Mr. DesJarlais. I don't mean to interrupt, but we have so
little time.
One of the things that was----
Secretary Sebelius. I would like to get you that answer in
writing.
Mr. DesJarlais. Thank you, ma'am. I would appreciate that.
One of the plans when ObamaCare was passed on Christmas Eve
in the middle of the night was that physicians were going to
assume a 21 percent cut in Medicare. Is that still your intent?
Secretary Sebelius. As you know, the President has
suggested since he came into office that the SGR has to be
fixed permanently. He has proposed again in the 2012 budget
that it be fixed. He has got 2-and-a-half years of offset and
looks forward to working with Congress to fix it.
The SGR I think remains as a major barrier to Medicare
beneficiaries, predated the Affordable Care Act, continues to
be an issue that I look forward to working with Congress to
fixing.
Mr. DesJarlais. In your testimony, I am reducing health
care costs and increasing quality--you mention several times
these innovation centers. You are going to pursue whenever
possible new approaches that will improve quality of care and
lead to savings. As I read through this, I see a lot of
assumptions and theories, but I don't see anything based on
fact.
What exactly are innovation centers and how can you assure
the American people when the health care system as we know now
is going bankrupt that we should just take a blind leap of
faith is that these things are going to work?
Secretary Sebelius. Well, there is one innovation center
umbrella, and there are already some programs that have been
put out in terms of regulation. So the accountable care
organizations is an opportunity for health care providers to
voluntarily come together around the care delivery system
focused on Medicare beneficiaries. And if indeed there are
savings achieved, they get to share in those savings. If there
are no savings, it is a net wash. We don't expend additional
funding. There is enormous enthusiasm among hospital systems
and providers groups for doing just that.
Mr. DesJarlais. You agree these are unproven, untested
theories?
Secretary Sebelius. They have never existed before.
Chairman Kline. The gentleman's time has expired. I thank
the gentleman.
I am looking at the clock, and we have less than an hour
before the Secretary has to leave, so I am going to be a little
bit more stringent on the 5-minute clock in order to give all
of our colleagues a chance to ask questions.
Mr. Grijalva, you are recognized.
Mr. Grijalva. Thank you, Mr. Chairman; and thank you, Madam
Secretary, for being with us.
First, an acknowledgement. Then I will raise a request and
just one question.
The acknowledgment is to your staff. They have been very
attentive to our office, and we appreciate that very much. Some
of the questions that came up regarding the waiver process in
Arizona, they have been very diligent about communicating with
us and giving us the information. We are very appreciative of
that. We have been persistent, and they have been equally
gracious, and so I appreciate that.
The concern I have is some of the proposed regulatory
changes to Head Start and early Head Start. I am concerned
there could be an impact on dual-language children. As you
know, this group of children, Latinos in particular, have a
proportionately low enrollment in Head Start and early Head
Start. As you work through those regulatory changes to diminish
fraud and abuse within those programs that should be
eliminated--my office looks forward to working with you so
there is no unintended consequences relative to the
participation of those children that desperately need to be
part of that program.
Secretary Sebelius. We would look forward to that.
Mr. Grijalva. A question just for historical purposes. Talk
about, if you would, talk about what you perceive to be the
original objectives of the Medicaid Act.
Secretary Sebelius. The Medicaid Act was clearly aimed at
providing health care services for some of the most vulnerable
Americans. Those who are the lowest income, children, pregnant
women, the disabled who qualify for Medicaid are primarily the
beneficiaries of that program.
Mr. Grijalva. Thank you----
Secretary Sebelius. And a partnership with State and local
government to deliver those services.
Mr. Grijalva. And I ask that question because those
objectives continue to be I think the guiding principle behind
Medicaid. But do you feel that some of the current attempts by
the majority in the House to change the program by rolling back
eligibility, the block grant process, making it more difficult
for those vulnerable populations to get access to health care
both at the State level and at the Federal level, how do they
match up with those objectives?
Secretary Sebelius. Well, Congressman, I am very
sympathetic to my former colleagues who are governors around
this country and are in very tough budget times. And balancing
a budget is never easy. Medicaid nationally is about 16 percent
of State budgets, and it is always something to look at.
We have been very diligent, working with States, around
giving maximum flexibility within the law, working on sharing
the best practices. We have got a lot of new governors who have
not been in that office before, and we have sent teams into 20
different States to work on what their snapshot looks like in
ways to save dollars.
I think the administration is continuously committed to
providing health care services to those very vulnerable
populations. We want to do it in the most cost-effective and,
frankly, the most high-value method possible, and that isn't
going on in every State around the country. So what we can do
is work with States to try and figure out ways to stretch those
dollars but provide those essential services.
Because the folks aren't going to go away. If the Federal
Government decides to shift costs, they just shift on to
States, to local governments, and, ultimately, on to people who
end up on the streets or in a jail or under a bridge because
they don't have the support system that they need to stay
healthy and stay productive.
Mr. Grijalva. Thank you.
In the collaboration with the Education Department around
Head Start--because Head Start is more than education. It is a
whole child program. And one of the discussions I think is
important, if I may suggest, is programs like Even Start that
extends that literacy to the whole family. One of the programs
that Education has indicated that they want to eliminate is
part of a component that I think merits discussion.
And thank you very much. I yield back.
Chairman Kline. I thank the gentleman.
Dr. Bucshon, you are recognized.
Mr. Bucshon. Thank you, Mr. Chairman; and thank you,
Secretary Sebelius, for being here today.
I am also a physician, cardiothoracic surgeon for the last
15 years. I have a bunch of questions, so I will try to brief.
You stated that Congressman Ryan's plan puts seniors on the
open market. Are you aware that it is designed after the same
type of health care plan that Members of Congress currently
have? And would you call that the government putting Members of
Congress onto the wide-open private health care market?
Secretary Sebelius. Yes. I mean, you are in a negotiated
Federal Employee Health Benefit Plan----
Mr. Bucshon. What I am saying is----
Secretary Sebelius. You don't have a fixed amount of
money----
Mr. Bucshon. Do I have to go to my local insurance agent
with government money and pick my health care plan? Or do I
have a book about this thick with a multitude of options from
which I can choose that have had--let me finish--that have had
negotiated rates that are competitive because to participate in
a program as a health insurer you have to be competitive?
This is the same proposal that Chairman Ryan has for
seniors, and it is clearly deceptive to say to the American
people that this is putting seniors into an open health care
market when in fact you know that that is not true.
Secretary Sebelius. Well, I do think it is putting
seniors--right now, they can choose a doctor, they can choose a
program----
Mr. Bucshon. So can I, actually.
Secretary Sebelius. And do multiple--in an insurance plan,
often the doctor is chosen for you, the health plan is chosen
for you.
I would suggest also, though, Congressman, one of the key
differences is the Federal Government is a much more generous
partner to Members of Congress in the Federal employee health
plan than Congressman Ryan suggests to be the seniors in the
plan that they would go into. Their voucher system has a much
lower buying power that the Federal employees do right now. It
in fact decreases over time, according to the Congressional
Budget Office. So rather than having the lion's share of the
program paid for by the Federal Government, you would actually
have the lion's share of the program paid for by seniors.
Mr. Bucshon. Well, I think that is still to be elucidated,
and I disagree with that premise.
Secretary Sebelius. That is not my analysis. That is the
Congressional Budget's analysis.
Mr. Bucshon. Let's move on.
You talk about Medicare savings and the Affordable Care Act
being against future growth. And you are aware that the
Medicaid proposal to the States for block granting, that what
you are calling cuts is actually also savings against an
unsustainable growth rate and has actually what you describe as
not cuts to Medicare but preventing further growth and that the
block grants are the same thing and that it would be deceptive
to say that this is actually a cut in the Medicaid program if
you are calling it savings in the Medicare program under the
Affordable Care Act. It is the same thing, right?
Secretary Sebelius. Well, the block grant is really the
administration of the program which, if I understand it
correctly, would get rid of the direction to protect vulnerable
populations. So States basically could pick and choose who to
cover and who not to cover. The fixed----
Mr. Bucshon. Excuse me, they have that ability now, don't
they?
Secretary Sebelius. No, sir. There are some mandatory
populations in Medicaid that they cannot drop.
Mr. Bucshon. Okay. I want to move on to is a different
subject.
NIOSH is under your jurisdiction in HHS, and under certain
responsibilities to the Federal Mine Safety and Health Act of
1977 they are the technical advisor to MSHA, mine safety.
Recently, MSHA has proposed a new rule on coal dust limitations
within underground coal mines. And my dad, by the way, was a
United Mine Worker for 37 years. We have asked for the
background medical information from MSHA and from others, and
they have said that that is being denied by Health and Human
Services because of patient privacy regulations.
And, first of all, is that true? Is that the reason why
this committee----
Secretary Sebelius. Congressman, I really have no--you are
saying this is a mine safety standard?
Mr. Bucshon. It is a coal dust mine safety standard. They
are trying to cut the standard down under MSHA.
Secretary Sebelius. I would be delighted to get you a full
and complete answer. I really have no idea.
Mr. Bucshon. Mr. Main also told me he would give us the
medical background information on that, and we haven't seen it
yet.
Secretary Sebelius. Mr. Who?
Mr. Bucshon. And he is saying that that is because Health
and Human Services with NIOSH is denying that because it is
private health information that you can't give under HIPPA
regulation. But we publish medical studies every day with
groups of patients.
Secretary Sebelius. As I say, Congressman, I will talk to
Dr. John Howard, who heads NIOSH, and get you a full answer. I
don't know about the mine safety regulation.
Mr. Bucshon. What I would appreciate is if we could get the
information from NIOSH, giving all of the background on the
proposed rule that they submitted to MSHA that justifies this
change in a long-standing regulation which in my view has as a
physician has no medical solid information that is necessary.
And let me say in my district in Indiana would be devastating
because of the many coal mines and others in my State would
likely not be able to comply and may have to close, again
resulting in a significant amount of job loss. I would
appreciate that information.
Chairman Kline. The gentleman's time has expired.
We can take that for the record. It is a follow-on
question.
Secretary Sebelius. I would be glad to. Thank you.
Chairman Kline. Ms. Woolsey.
Ms. Woolsey. Thank you, Mr. Chairman.
I thought I would take the opportunity before I ask our
wonderful Secretary a question to respond to the gentleman from
Tennessee in his question of how the Republicans could be
challenged over their proposal to privatize Medicare.
The answer is simple. And the answer is, when their plan
increases the tax cuts for the wealthiest Americans, when oil
companies continue to get tax breaks and subsidies, when
corporations, successful corporations, pay absolutely no taxes,
they are proposing to privatize Medicare and at the same time
asking seniors to take a blind leap of faith that, by
privatizing Medicare, the private insurers will actually take
care of the senior citizens in this country. And that is why
there is so much pushback to their proposal.
So now I want to go to my question which has to do with--
you mentioned, Secretary Sebelius, a healthy development of all
of our children, which of course I support 100 percent. And I
think part of that healthy development is ensuring that when
they enter the classroom they are well, their mental and
physical health is being cared for. Otherwise, these kids can't
learn. They can't succeed.
Well, last week, the House voted to eliminate funding for
the construction of school health centers, under the pretense
of the Republican bill that there are other sources of funding
laying around this country that could pay for these school
health centers. So you know better than I do that 8 million
children lack access to any primary health care, and they need
this in order to get through school. So could you expand on the
value of investing in school health systems and what that means
to the future of our children and our country?
Secretary Sebelius. Well, Congresswoman, we are doing two
things right now to expand access to coverage for children. One
is to take advantage of the opportunity given by the CHIP
reauthorization of 2009 to do some very extensive outreach. We
think there are likely still about 5 million children who are
eligible but not enrolled. So we have a very robust outreach
effort going on with school districts and health care
providers, using sport stars and coaches, others, to try and
reach the parents and enroll those kids.
But there is no question I think that one of the most
effective strategies is actually, since schools are often in
the hearts of neighborhoods, that a school-based clinic not
only deals with the children's health needs but often the
family health needs of the neighborhood. So the Affordable Care
Act designated as one of the sites for expansion of community
health centers school-based clinics, which was a recognition
that moving into underserved areas, outreach in a very easy way
for people to access health services was often very productive
and certainly for parents and children to access services
together is very effective.
So I think that the funding goal of expanding the school-
based health clinic footprint was a wise strategy to make sure
that we are reaching into many of these underserved communities
and figuring out ways to have accessible health care during the
time that families would most likely be able to access health
care providers.
Ms. Woolsey. So can you think of any pockets of funding
where there are excess monies that could be--without our
funding these school-based health centers?
Secretary Sebelius. Well, we are embarked on an expansion
of the community health center footprint. Unfortunately, that
got decreased a bit by the CR 2011, but we will continue I
think to do that. Because community health centers actually
have been proven over and over again to be enormously effective
in lower-cost, high-quality preventive care. And if we want to
stop paying $0.70 out of every health dollar on chronic
disease, getting to conditions very early and certainly getting
to kids very early. You don't learn well if you are not
healthy. You can't study in school if you are not well. So
getting a productive workforce starts with having highly
educated kids, and kids won't be well educated unless they are
healthy.
Ms. Woolsey. Thank you.
Chairman Kline. The gentlelady's time has expired, and I
was so hoping the Secretary could identify one of those
untouched pots of money.
Secretary Sebelius. If I find it, I will tell you, Mr.
Chairman.
Chairman Kline. I will hold you to it.
Mr. Kelly, you are recognized.
Mr. Kelly. Thank you, Mr. Chairman.
I would like to yield my time to my colleague, Dr. Roe.
Mr. Roe. I thank the gentleman for yielding.
Madam Secretary, I think we could have approached--and I
read the bill as you did. It is a hard read. And I think we
could have approached getting where you wanted to be by doing
exactly one of the things you just said. Which if we go sign up
the young--the children, 5 million of them I think was what you
said who are currently eligible for SCHIP, the people who are
currently eligible for Medicaid--and the part about the bill I
like a lot is to allow your adult age children pick your
number--25, 26, or 27, you could have covered almost as many
people doing those two things as you are talking about doing
right now with a 2,500 page bill and is so complex that nobody
understands it. I just want to make that point.
I want to get into something near and dear to my heart,
which is my fear of rationing of health care.
The Independent Payment Advisory Board, as you know, was
not in the House version of the Affordable Care Act. It did get
in the Senate version. And many of my colleagues on the other
side of the aisle opposed this. How do I go answer to my
constituents and to patients at home that I have been seeing
that, okay, we are going get to a certain spending level, and
not based on quality we are going to make a decision about how
the money is spent. How is that not going to affect rationing
of care in the future, when you have more services chasing
fewer dollars, which is exactly the train wreck I see coming.
Secretary Sebelius. Well, Congressman, the way the
Independent Payment Advisory Board is set up is it is 15
individuals who have to have expertise as either health care
providers or health economists, experts in health who actually
are forbidden by law to ration care. That is part of the
statutory framework.
Mr. Roe. Let me stop you right there. Who ends up rationing
it is me when I can't give it in the examining room. We have 15
bureaucrats appointed up here. It is not called rationing, but
when you get up to a certain dollar limit and you can't spend
any more money, you can't provide the service. So I am in my
examining----
Secretary Sebelius. Well, I would share your dismay about a
fixed-income level, and that is exactly what the House budget
proposed for Medicare. We will give you a fixed amount of
money, and you figure out what services you get. That is not
what the Independent Payment Advisory Board is about. It is
about making recommendations for strategies, for new services,
for new----
Mr. Roe. I beg to differ.
Secretary Sebelius [continuing]. Research and that comes to
Congress. Congress has the intermediary role with--the
Independent Payment Advisory Board's recommendations do not go
into effect unless Congress chooses to allow them to go into
effect.
Mr. Roe. They do go into effect unless we pick some other
way to----
Secretary Sebelius. Unless you say no.
Mr. Roe. Exactly. No, unless you pick some other way not to
spend the money, it is going to end up--I am certainly very
familiar with NICE in England. The National Institute of
Clinical Excellence is exactly the same type board.
So you would support the IPAB when most of the Congress on
the House side did not support the IPAB, including my
colleagues on the other side of the aisle. As a matter of fact,
several of them have signed onto a bill to repeal that,
because----
Secretary Sebelius. I do very much support the notion that
we would have an independent group making recommendations about
cost-effective strategies. We have it now.
Mr. Roe. It is an advisory board now.
Secretary Sebelius. It is an advisory board. It would
continue to be the Independent Payment Advisory Board. The
recommendations would come to Congress--and, again, they are
not implementing medical decisions, and there is no global cap
that they are working under. And, again, I----
Mr. Roe. I think we have a difference of opinion there.
A question I have on the Mini-Med plans. Why were 1,100
exemptions given? And what will happen to them after those
exemptions expire? When they can't afford the government-
decided plan, what happens then?
Secretary Sebelius. Well, Dr. Roe, the waivers are a part
of keeping your plan in at least the time between now and the
new marketplace in 2014. Unfortunately, lots of people have
some form of coverage that often is not very comprehensive, and
they are in a situation where currently in 2011 and 2012 and
2013 something is better than nothing.
So the Congress directed us to take a look at the one
provision of the plan that talks about getting to an annual
limit that would cover comprehensive medical expenses, but
suggesting that if indeed a plan can't meet that annual limit
without major disruption in the marketplace between now and
2014 when there is a new exchange, a new opportunity to buy a
comprehensive policy at lower cost, that we should indeed look
at waivers.
And basically 97 percent of the folks who came in the door
who gave us the documentation saying we can't get to this point
because we have such, frankly, low coverage and modest
applicability we decided that some coverage was better that no
coverage. And those plans will not exist after 2014.
Mr. Roe. I yield back. I recommend you read this.
Chairman Kline. The gentleman's time has expired.
Mrs. Davis, you are recognized.
Mrs. Davis. Thank you, Mr. Chairman; and thank you, Madam
Secretary, for being here today and for your service as well.
As you are aware, this week the majority singled out and
cut funding to create insurance exchanges where Americans could
go to buy affordable coverage without discrimination. And we
know in California--and thanks to Governor Schwarzenegger in
this--California has been one of the first States really to get
out of the gate essentially to establish the exchanges. So when
it comes to States like California that are already in the
middle of this process, what kind of difficulties do you see as
a result of cutting off the funding that this action would
actually cause?
I am also wondering how the effort would block funding for
health exchanges across the country. Would there be some delays
and what impact is it likely to have on reducing the number of
uninsured Americans?
Secretary Sebelius. Congresswoman, if the provision passed
by the House would be passed by the Senate and signed into law
by the President, I don't think there is any question that
there would be serious inability of States to move forward with
creating a new marketplace, particularly for small business
owners and individuals who currently are not only paying more
but many of them are uninsured.
We are actually working with governors around the country
to set up State-based exchanges and the resources are being
used to do everything from planning to put together IT systems
so that you would have a seamless way to come into a market as
an uninsured American, with the goal being that every American
should have available, affordable health insurance. Whether you
end up as a Medicaid beneficiary in a private market, an
employer market, that that is the goal to have a fairly
seamless system.
Defunding the exchanges would mean that we freeze the
status quo where more and more Americans every year are
uninsured, where insurance rates continue to rise at an
alarming rate and families and small business owners would face
either increasing costs or bankruptcy for health conditions
which they have no insurance to pay for.
Mrs. Davis. Is it anticipated that there would be a delay
in this, perhaps a few years, or that they would actually be
frozen in place?
Secretary Sebelius. Well, if the funding goes away, I
really don't know--take the case of California--how indeed
California would put together an exchange system that would be
operational by 2014. So I think it stops the process unless
they find some of that money that we are looking for to fund
the school-based health clinics that we haven't found yet. If
that appears, we could do this. But, absent that funding
stream, I think most States would just stop working on the
exchange program.
Mrs. Davis. Thank you very much. I appreciate that.
I think that we want--at least in California I know they
are continuing to have these intense discussions, as you noted
earlier, in terms of the accountable care organizations and
others. It certainly is impacting those discussions, but we are
hoping that they at least will continue to have them.
I wanted to also just mention briefly the disease
prevention issues that we are all I think very concerned about.
Certainly singling out the national diabetes prevention program
as well, building on evidence-based methods, give individuals
at risk guidance on how to prevent type II diabetes. That is
eligible for funding from the Prevention and Public Health Fund
at HHS. And so are you saying that this issue is really going
to be established as a national priority in many ways? And how
does that dovetail with the work that you are doing with this?
Secretary Sebelius. Well, I don't think there is any
question that the historic investment in the prevention fund is
one that we see yielding significant dividends as you go
forward.
Again, the snapshot right now is $0.70 out of every health
dollar is spent on dealing with chronic disease. If we indeed
can lower the smoking rate, if we can have a healthier
population heading into their 50s and 60s by significantly
making a dent in everything from diabetes to heart disease, we
will have dramatic impact on not only the health costs of this
country but on the health of this country.
So lower costs, better health is the goal of the prevention
fund. And we have some very exciting programs under way across
this country in tribes, in farm communities, in cities that are
really looking at measurable ways to change behavior, to change
practices, knowing that that is an enormously important step.
If we can have a healthier population, invest in primary care
and prevention, we wouldn't be spending the dollars that----
Mrs. Davis. As a member of Armed Services, it is also a
national security issue.
Chairman Kline. The gentlelady's time has expired.
Mr. Ross.
Mr. Ross. Thank you, Mr. Chairman.
Madam secretary, thank you for being here.
I want to address health care and jobs, because we note
that with the mandates that are in the Patient Protection and
Affordable Health Care Act there is going to be some burdens
put on employers here. Specifically in the area of service
industries in the last 10 years they have been the most
predominant and most productive types of jobs we have seen in
Florida--agriculture, retail, restaurants, hotels--intensely
labor but low profit per employee.
My concern is that that when we understand there is going
to be a per employee cost of about $2,000 for health care that
is going to be have to be provided by these employers, these
employers may not be able to continue to either keep the
employment that they have, won't be able to expand. While I
appreciate that in the Act there are exemptions for employers
with 50 or fewer employees, my specific question is, would you
consider exemptions based on a low profit per employee?
Secretary Sebelius. Well, Congressman, we are working
within the framework of the law, but my experience is that,
currently, most employers who talk to me and particularly most
employers who are struggling in the marketplace find health
insurance to be the best way to keep talented employees----
Mr. Ross. I agree. But when it becomes a cost that exceeds
what the market will bear, they are either going to have to
release employees or scale back their time.
Secretary Sebelius. But right now they are competing
against folks who often are playing on an unlevel playing
field. Often, the big employers can find health benefits, and
they are losing their best workers going down the street or
around the corner. I would suggest this creates a framework,
and the lowest income employees actually gets help with
subsidies in the exchange program that they currently don't
have. So it is kind of a win/win.
Mr. Ross. You think then that the lower employees--the
lower-income-earning employees? But if it is mandated that the
employer provide the coverage and their coverage is $2,000 per
employee and they only have a margin of $2,400 per employee,
that margin is going to be reduced to $400. So these are the
businesses that will be most concerned about the impact of this
care, this Act.
Secretary Sebelius. Again, I am not sure we are talking
about a large employer who----
Mr. Ross. It would have to be more than 50.
Secretary Sebelius. If a large employer is not providing
coverage and has an employee who then takes access of the
coverage in the exchange, there will be an employer
contribution to help pay the taxpayer burden that is being
picked up. A small employer will be able to participate in the
exchange and have an opportunity to get lower cost coverage for
employees that they are not covering right now.
Mr. Ross. Let's talk about the exchange for a second.
Because I appreciate the fact that, as a former insurance
commissioner, you understand the dynamics of insurance and the
markets of insurance. And of course the private companies sell
insurance for a reason, to make a profit, but they do so with
private capital. That is what is going to back the risk that
they insure. And that capital is global. They get it from
certain areas. They don't consolidate their risk, and it is
actuarially assessed in terms of their risk.
But when the government gets in the business of insurance,
they don't have that capital. What they have is assessments and
taxes with which to go after to satisfy any claims.
Unfortunately, in the assessment of that risk, it is more
politically assessed, as opposed to actuarially assessed.
So that being said, would you not agree then that when the
government gets in the business of insurance that what they are
putting at risk are taxpayer dollars and assessments as opposed
private capital that is spread globally?
Secretary Sebelius. I would say there is certainly more
taxpayer dollars involved in the government-based plans, but I
would also suggest that private insurers right now participate
actively in Medicare Advantage programs. Most States run their
CHIP programs through the private market. They are Medicaid
beneficiaries. So there is not a line drawn between government
plans and the private market.
Mr. Ross. There is, though; and I think that is something
we have to talk about. If we are going to talk about health
insurance, because our President said at the outset of his
lobbying on this bill that we had a health insurance crisis.
And, as you know, each State under the McCarran-Ferguson Act
regulates their insurance market. We have got fewer insurance
companies in the State of Florida because of mandates in
Florida, fewer in Alabama, but yet we have over 1,200 insurance
companies who want to sell throughout this country. Would you
not agree then that for consumers, for a market that wants to
be based on capital and not taxpayer dollars supporting it, we
should open up the barriers and allow for the interstate sale
of health insurance?
Secretary Sebelius. Congressman, as you know, companies can
now sell in any State that they want. They have to be licensed
by the State and have to follow the State laws, but----
Mr. Ross. But they have a different mandates. In other
words, you have got 51 mandates in Florida. You may have three
in Alabama. You may have so many more in Pennsylvania.
Secretary Sebelius. The elected legislators in Florida pass
laws that the governor signed. That is the Florida----
Chairman Kline. The gentleman's time has expired.
Mr. Scott. Thank you, Mr. Chairman.
Madam Secretary, just a quick civil rights question. Is it
possible for any sponsors of programs run in your Department of
private organizations to get grants to run programs to
discriminate based on religion? That is to say, you would have
been a good applicant for this job, but we don't hire people of
your religion. Is that possible?
Secretary Sebelius. To my knowledge, that would violate the
civil rights umbrella that we operate under, Congressman.
Mr. Scott. So that if a faith-based organization were
running a program and said we don't hire Catholics, Jews, or
Muslims, you wouldn't think they could get funded under your
administration, do you?
Secretary Sebelius. To my knowledge, no.
Mr. Scott. Thank you. Under the essential benefit
definition of--under the ACA, it is my understanding that the
Institute of Medicine is currently working on recommendations.
In terms of children, the EPSDT program under Medicaid is
considered a good standard for care for children. Would it be
your recommendation that that be the essential benefit package
for children under policies under ACA?
Secretary Sebelius. Well, Congressman, the way that
actually the essential benefit portion of the discussion is
framed in the ACA, there are multiple steps. The Department of
Labor has just given us the results of a survey that they did
on private-market plans, the typical benefits in a private-
market plan, looking at large employers and small employers. So
that is a step mandated by the law.
What the Institute of Medicine is doing is sort of step
two, which is looking at the process for putting together an
essential benefit package and how often that criteria would be
updated.
Step three is really for HHS then to do extensive listening
and outreach to everybody from provider groups to disease
groups to patient advocates in terms of getting input on what
an essential benefit package should look like, and then a rule
will be promulgated. So IOM is actually really more on the
process side. They are not doing the health benefits side.
Mr. Scott. The EPSDT package of benefits, do you consider
that something worth recommending?
Secretary Sebelius. Well, I think it certainly sets a
standard for an effective package for children; and, currently,
the Affordable Care Act would say that the preventive care that
is offered needs to be part of all insurance policies going
forward if it is recommended as part of the prevention
protocol.
Mr. Scott. The GOP budget makes certain spending cuts--Pell
Grants, education, transportation like high-speed rail, law
enforcement, Food and Drug Administration--a list of cuts that
total about $800 billion, which they totally offset with
extending tax cuts for that portion of your income over
$250,000. So that is a complete wash.
All of their net savings come from Medicare and Medicaid,
cuts in those program. Are you familiar with their little
voucher program, with the voucher program in the Medicare?
Secretary Sebelius. In the Medicare proposal, yes, sir.
Mr. Scott. Does it provide any limit on what the private
industry can charge?
Secretary Sebelius. Not to my knowledge. I haven't seen the
underlying details. Maybe they exist, but I haven't at least
seen them. I have seen the outlines.
Mr. Scott. Do you know if there is any guaranteed issue if
you get one of these vouchers that you can actually buy some
insurance somewhere?
Secretary Sebelius. There is, I think, a limitation--a ban
on eliminating people because of pre-existing conditions, but
whether or not the dollar amount itself would allow you to buy
a plan, I don't know.
Mr. Scott. If you can't afford it, are there any subsidies
to help you buy the insurance?
Secretary Sebelius. There are, if I understand it
correctly, additional resources available to the lowest income.
So there is some sliding scale that would increase the buying
power of the voucher depending on income.
Mr. Scott. As I understand it, when it starts off, the
senior citizens will be paying about $6,000 more of their
income towards this policy, and after about 10 more years it
gets up to about $12,000, which would be about half the average
Social Security check; is that right?
Secretary Sebelius. Yes, I think there is a dramatic shift
of costs onto seniors.
Mr. Scott. Thank you, Mr. Chairman.
Chairman Kline. I thank the gentleman.
Mr. Gowdy.
Mr. Gowdy. Thank you, Mr. Chairman.
Madam Secretary, do you believe the commerce clause has
sufficient elasticity to allow Congress to mandate individuals
purchase health insurance?
Secretary Sebelius. I try not to practice law without a
license, but I have listened closely to our legal team, and I
think they believe strongly that the bill stands on solid
constitutional grounds.
Mr. Gowdy. You would have to believe that or you wouldn't
be able to support the President's health care reform, right?
Secretary Sebelius. That is correct.
Mr. Gowdy. And because you believe that, you also would
necessarily have to believe that Congress can also pass medical
malpractice reform because we would use that same commerce
clause. And I found it instructive that this administration has
not proposed any medical malpractice reform, so perhaps we can
take this opportunity and identify what medical malpractice
reform initiatives you would support.
Secretary Sebelius. Actually, Congressman, that last
statement is not accurate. The President asked me during the
course of the health care debate to actually use the powers
that have been with HHS for a period of time to put in place
some targeted programs around the country.
Mr. Gowdy. I am not talking about targeted programs, Madam
Secretary.
Secretary Sebelius. Sir, they are looking at what kind of
medical malpractice actually has the following criteria: It
increases patient safety, lowers liability costs.
Mr. Gowdy. Has this administration proposed specific
medical malpractice reform initiatives?
Secretary Sebelius. I have just explained to you what is
under way right now. They are actually in place.
Mr. Gowdy. Give me one. Give me a specific. Joint and
several liability. Have you proposed reforming that?
Secretary Sebelius. Are you saying have we proposed the law
to change and preempt State law?
Mr. Gowdy. Have you championed the cause of medical
malpractice reform?
Secretary Sebelius. Actually, right now, we have across the
country health care systems and court systems putting in place
malpractice reforms that meet criteria to see and measure what
exactly works. Because the data is pretty inclusive whether or
not you can increase patient safety and lower liability rates
by a variety of strategies.
So those are in place right now. They were put in place by
our budget with our authority that had actually never been used
before by anybody but President Obama.
Mr. Gowdy. Do you support reforming joint and several
liability?
Secretary Sebelius. Do I support preempting State law by
Congress? No, sir.
Mr. Gowdy. Well, ma'am, and therein lies the issue, right.
Because why would that be a preemption of State law in any
greater degree than any other Federal initiative? You think if
we were to reform joint and several liability that that would
preempt State law?
Secretary Sebelius. I think State, at a time, they have
taken on that issue and dealt with it, yes, sir.
Mr. Gowdy. What about a different standard of care for
emergency medicine. Would you support----
Secretary Sebelius. I have no idea what is the different
standard of care. What does----
Mr. Gowdy. There is not. So if a physician is treating
someone at a ball game or at a church, doesn't know the patient
history, there is no different standard by which their practice
will be judged than if they had a 20-year-long history with
that particular patient.
So my question is, would you support a different----
Secretary Sebelius. Sir, I would be delighted to look at
any proposal. I think it is impossible to answer a question
when I haven't seen the specifics of what is being talked about
and how it would impact, but I would be happy to take a look at
it.
Mr. Gowdy. I have read your comments about the debt, and I
have read the President's comments about the debt, and I assume
you would agree that, because you have said, that our debt is
stifling. So my question is, given the fact that we agree on
that, why was there no proposal for an entitlement reform in
this administration's initial budget?
Secretary Sebelius. Well, Congressman, I would suggest that
the Affordable Care Act had a significant step toward
entitlement reform with a $500 billion reduction in growth rate
of Medicare. That was a big step forward. That was not
supported by many in this Congress, but it was the President's
first step.
I would also suggest that the IPAP proposal, which is part
of the Affordable Care Act, is also another big step in terms
of entitlement reform that actually doesn't potentially cause
harm to our seniors but makes us make more strategic decisions
about cost-effectiveness of proposals.
We are currently working on proposals around dual-
eligibles, which is the most significant cost driver in
Medicaid, and have a proposal under way in our innovation
center where 15 States are going to be participating to see if
we can really find health strategies that look at that highest-
cost population. So there are significant steps under way.
Mr. Gowdy. Well, let me ask you this, because the light
just went off.
If the President's initial health care reform bill was
sufficient, why did he then come out with a second budget after
Paul Ryan took on entitlement reform? Why did you come out with
a second budget that dealt with it?
Chairman Kline. The gentleman's time has expired.
Ms. Hirono.
Ms. Hirono. Thank you, Mr. Chairman and Madam Secretary.
I just would like to make a comment regarding medical
malpractice reform. I would like to see the evidence that
connects malpractice reform with lowering of medical
malpractice insurance. There has never been--that, I don't
think, has been shown; and, therefore, you know, I would like
to see that evidence. Because States all across the country
have enacted medical malpractice reform, and the doctors are
still paying huge premiums for medical malpractice.
I think in both education and health care, early
intervention and prevention are the keys. Because we save money
in the long run. And that is why we should be supporting
programs such as school-based health centers and Head Start and
quality early education. I have been a major proponent of
quality early education.
Madam Secretary, I understand that you had responded to a
question regarding the third round of Race to the Top where
your Department and the Department of Education will be working
together to, I hope, come up with an early learning competition
that is kind of like the Early Learning Challenge Fund, and so
I am glad to hear that. I did send a letter to both you and our
Education Secretary, Arne Duncan, to that point, and I await
your response.
I want to go on to the Medicare changes that the
Republicans would like to propose. During the 2 weeks that I
was in Hawaii, I met with hundreds of seniors, and they are
very concerned about what the Republicans have in mind for
Medicare.
For one thing, they are totally astounded that they would
have to wait until age 67 before they qualify for Medicare. And
I know that they are thinking about when they were 65 and
finally got on Medicare, health insurance, and I know that they
were thinking what if we had to go 2 years to 67 without any
insurance.
So then the next area that they are really concerned about
is, even if they are currently on Medicare, they care about
those who are under 55 who are going to be in this new plan, as
the Republicans would like to enact.
So this voucher system--you responded to some questions
about the voucher system, and I am not clear exactly how that
is supposed to work. You are a 67-year-old senior, you get a
voucher and what? What is supposed to happen? What are you
supposed to do to get health insurance?
Secretary Sebelius. Congresswoman, I don't pretend to have
all the details, but my understanding is it would essentially
operate as a subsidy to purchase private insurance coverage.
There would be some rules around, as I said, the limitation on
pre-existing conditions, so you couldn't be locked out of the
marketplace.
I don't know that there is any framework of what you could
purchase with that coverage. So I assume that companies would
put together packages. Somebody would make a choice about
whether that package would be sufficient. I really don't know
how it works.
Ms. Hirono. Madam Secretary, thank you. Because I am
wondering what kinds of packages a private insurance company
will put together for 67-year-olds and older with all these
pre-existing conditions, even if they cannot deny insurance
because of pre-existing conditions. I am wondering whether all
these private insurance companies will stand in line to put
together these kinds of programs for 67-year-olds. And, in
fact, when I asked that question of the hundreds of seniors
that I talked to, they couldn't even--they were just--I know
that they were very scared as to how this was supposed to
happen.
So would you share that kind of concern that I have as to
whether the private insurance industry can be counted on to
come up with all these different plans that our seniors could
avail themselves of?
Secretary Sebelius. Well, we currently have some model of
the private market in Medicare space with Medicare Advantage
programs that have been in operation for over a decade. On
average, they are more costly than fee-for-service Medicare,
with no perceptible health improvements whatsoever after 10
years.
We know that the companies have done somewhat effective
jobs of doing a bit of cherry-picking in the marketplace, and I
think that that is really how you make a profit in health
insurance, is that you hopefully get a population that is less
sick than more sick. And what I think is of great concern is
that the amount of money identified as the fixed benefit
nowhere nearly matches the potential cost of the services to
the average Medicare beneficiary right now, much less down the
road, and that buying power diminishes over time.
Ms. Hirono. And I think that seniors across our country are
understanding that with regard to the Ryan budget.
Thank you.
Chairman Kline. The gentlelady's time has expired.
Mr. Barletta.
Mr. Barletta. Thank you, Mr. Chairman.
Madam Secretary, as you know, the PPACA has made
significant changes to the laws governing insurance markets and
employer-sponsored health care, many of which have the effect
of increasing costs for employers, workers, and their families.
In an effort to pay for the new subsidy entitlement
program, PPACA reduces Medicare expenditures by more than $500
billion and imposes hundreds of billions of dollars in new
taxes and penalties, which will likely raise the cost of
coverage and increase the financial pressures on employers
struggling to grow their businesses and create jobs.
For small business, home health care providers, this is a
huge burden. I have specifically heard from my constituents
about the 2.3 percent excise tax on manufacturers and importers
of certain medical devices. How can you justify this tax,
especially for small businesses, home care providers who work
in rural areas?
Secretary Sebelius. Well, Congressman, I think that one of
the features of the Affordable Care Act, which is different,
frankly, from the Prescription Drug Act that was passed in a
prior administration, is that it is paid for and it does not
add to the deficit. In fact, the Congressional Budget Office
has estimated that about $230 billion in the first decade and
over a trillion dollars in the second decade will be decreased
from the deficit. So there are pay-fors in the bill.
I think the trade-off that you are talking about with a tax
on home health manufacturers is that they are also anticipating
additional customers along the way, so there is some additional
revenue that will be generated and the return is that they will
have access to a far more significant market, who will have,
actually, the ability to pay for home health services where
they don't right now.
Mr. Barletta. Moving on to another question, in response to
questions I have received from small business pharmacists in
northeastern Pennsylvania, would you be able to address the
rapid refill of prescription medicine? More specifically, many
in my community are concerned that prescriptions are being
offered in 90-day increments by certain large-scale stores,
even though their primary care physician may modify the
prescription prior to its expiration. Is this a new process
allowed by the Department of Health and Human Services as a
result of PPACA?
Secretary Sebelius. I can tell that you there is no new
process about prescription refills that is part of the
Affordable Care Act. I don't know what is causing what you are
talking about, but I would be happy to go talk to our folks and
see if they have heard about it or know about it.
But there is absolutely no--nothing that has been put into
effect in the year that has any impact on prescription drug
refills.
Mr. Barletta. As a former mayor of a city in northeastern
Pennsylvania, Hazleton, I have witnessed firsthand the benefits
of the human services programs operated by HHS. I am
specifically familiar with and interested in the Community
Services Block Grant Program. The President's 2012 budget
request includes a $388 million cut to the Community Services
Block Grant Program which, as you know, is geared toward anti-
poverty activities.
Over the last 10 years, a number of independent studies,
including those conducted by GAO, have questioned the program's
effectiveness in combating poverty in local communities. In my
community, the Commission on Economic Opportunity, an
organization committed to combating local poverty, they use the
Community Services Block Grant funding to help promote self
sufficiency among low-income populations in Luzerne County.
In February, I had the privilege of meeting with the
officials of this organization; and I toured their after-school
program that ensures children get healthy meals throughout the
year. In fact, this organization's food bank, which also
assists the elderly population in Luzerne County, has provided
over 4 million pounds of foods to 160 agencies over the past
year.
And while I have seen the good of this program and others
like it, I am supportive in finding ways to make the CSBG
program even stronger. What changes do you think the committee
should make to the Community Services Block Grant Program to
make it more effective, and when was the last time this program
was evaluated?
Secretary Sebelius. Congressman, first of all, let me say I
would look forward to working with you to do just that. I think
that there is no question at all that the reduction in funding
that is being proposed is not one that would have been proposed
if the budget times were better. Let me start there.
I also think that it has been our experience that the funds
administered through the State and to a variety of community
action agencies, some are very competent and effective, others
have been less effective. And we are currently in the process
of reviewing, knowing that we are likely to have diminished
resources, what are the kinds of criteria to put in place that
would actually drive the best practices around the country.
Because I would say that the program impact has been really
mixed. But we would look forward to working with you around
what that strategy looks like.
Mr. Barletta. Thank you.
Chairman Kline. The gentleman's time has expired.
Mr. Tierney.
Mr. Tierney. Thank you, Mr. Chairman.
Madam Secretary, thank you for being here today.
Let me just start with a couple of very brief questions
about low-income home fuel assistance. On that, can you give me
an idea of when that money is going to be released to the
States? Because we have reports of people fearing the loss of
their utilities if that money doesn't get released to the
States so that they can distribute it.
Secretary Sebelius. I am trying to get my experts back here
to give me----
Mr. Tierney. Well, if you could give me that answer, if you
can't give it to me right now, if you could get that to us when
you can.
Secretary Sebelius. We will get it to you.
Mr. Tierney. Thank you.
Secretary Sebelius. And what we tried to do up until this
moment, I can tell you, is put the money out the door as soon
as we had the authorization. So I can get you the precise date
that we will try to push the rest of the fiscal year 2011 money
out.
Mr. Tierney. I appreciate that.
In the President's proposal for 2012, he proposed a 40
percent cut in those funds, premised on the idea that the costs
are going to be somewhere around--somewhat lower in the future.
Now the costs are back up to what they were in 2008 for oil,
and they are increasing for gas. Are you going to revisit that
decision?
Secretary Sebelius. Well, Congressman, as you know, the
budget has been proposed. We would look forward to working with
you.
I know it is a vital program. It was a snapshot that looked
like we were in times that could return to the historic level,
but I think we need to look at the challenges and that impact
on particularly the low-income families who rely on it.
Mr. Tierney. We would appreciate that. Thank you. We will
work with you on that as well.
Just a quick comment on the medical malpractice, as we do
quite a bit of looking at that. Are you aware of any study at
all that indicates that even if all the medical malpractice
reforms proposed went into effect it would do anything more
than save a minuscule fraction of the national health care
costs?
Secretary Sebelius. Well, I think, right now, malpractice
premiums are far less than 1 percent of any health care costs;
and, unfortunately, the data is very erratic. States that have
put in place every kind of tort reform possible and States that
have no tort reform possible seem to have about the same
malpractice rates. So there doesn't seem to be a corollary
impact between the legal framework and what docs are paying.
It is difficult to assess and measure what defensive
medicine costs. It is also, I think, very difficult to measure
what a lack of patient safety costs. And those--you know, we
talked about errors that occur in the medical system right now
which kill about 100,000 people a year, so I think that balance
is very critical.
Mr. Tierney. And it is a State-regulated insurance
industry; is that correct?
Secretary Sebelius. That is correct, sir.
Mr. Tierney. Lastly, I do see reports, however, that draw a
correlation between the return on investment from reserve funds
by insurance companies and the increase in premiums. I think
that would be a more appropriate place to look for some
correlation; is that correct?
Mr. Tierney. Well, I think the malpractice market has been
very lucrative.
Mr. Tierney. It has indeed.
The community health centers, in H.R. 1, the original
proposal for the continuing resolution, there was a proposal to
substantially cut the funding for those centers. It would have
closed about 127 centers if it had been passed. It would have
cut off about 11 million participants. It would have caused
thousands of people to lose their jobs. In the end, there was a
much less severe reduction in that.
But can you talk to us just for a second about the value of
community health centers, what used to be a bipartisan
priority? I can remember working with President Bush on this as
well, how important it is or isn't to our system, and what
attention we should be giving to those centers?
Secretary Sebelius. Well, I don't think there is any
question that the current community health center footprint is
an enormously important infrastructure for low-cost, high-
quality delivery of health care in the most underserved rural
and urban areas. The training of docs in community health
centers is a terrific training ground, and over and over again
they are proven to be enormously effective.
The trajectory that this administration proposed was,
actually, moving from the opportunity from 20 million Americans
served by community health centers to 40 million Americans,
starting with the investment in the Recovery Act and moving on
through the Affordable Care Act. That has taken a little bit of
a bump in the road, but we still feel that having an expansion
of community health centers and matching them to the most
underserved area is the most effective, most efficient, most
cost-effective way of getting high-quality health services to
people who now have limited access to doctors.
Mr. Tierney. Thank you.
Let me just close with the notion that the Medicare and the
Affordable Care Act reduced monies. I think we have made the
point. We want to reiterate it. It would slow the growth of
costs, and I note that in the Republican proposal they don't
change that fact. They like the savings of those costs, and
they understand that that was, in fact, addressing an
entitlement by slowing the growth in costs without reducing the
number of defined benefits, is that correct?
Secretary Sebelius. Well, that is absolutely correct. In
fact, the language in the bill, as you know, re-emphasizes the
fact that no defined benefit can be tampered with. So, in fact,
the Affordable Care Act increased the benefits so seniors now
will have the donut hole closed over time and not fall into the
gap in drug coverage, will have an annual wellness benefit,
will have preventive care without co-pays. So there are some
significant enhancements as part of the guaranteed Medicare
benefits, along with the reduction in the costs over time.
Mr. Tierney. Thank you.
Chairman Kline. The gentleman's time has expired.
Madam Secretary, we have two final questioners, and we
would like to allow both of them to have an opportunity. So,
Mr. Rokita, you are recognized.
Mr. Rokita. Thank you, Mr. Speaker, and thank you, Madam
Secretary. I am one of the last questioners, so hopefully we
will be able to respect your time. We appreciate your being
here.
With regard to this medical malpractice that has popped up
fairly late, of course you understand that, at least for many
Americans, many of us that I represent, it is not the premium
that the doctors pay that is the concern, it is the defensive
medicine costs. And you have indicated that it might be a hard
cost to determine.
I don't know if I agree with that. I think we have been
able to determine in this country a lot of other things. And my
doctor colleagues, including the two that sit on either side of
me on this committee, when I asked them before they left, they
say it could be anywhere between 100 and 500 billion a year in
defensive medicine costs. And they do this every day, as
specialists at least. So I wanted to let you know about that.
And then as a member of the Budget Committee, in case you
are asked these things again, I need you to know that the
plan--because you said you saw some outline of the budget but
not necessarily the details--- it is not a voucher. It doesn't
go to the person. It goes to the insurance companies who would
want to participate.
And on our Federal plan, as Dr. Bucshon was explaining,
there are at least nine or so different kinds of plans
depending on what part of life we are in that we can choose
from. And to the extent the Congress is a microcosm of the
people, generally, I really don't understand why that couldn't
work.
Secretary Sebelius. Well, part of it is the Federal
Government is paying 70 percent of the cost of your health care
right now and--assuming that you are in the Federal employee
benefit package. This plan is significantly less generous for a
more, I would say, likely to be sick population, more difficult
conditions, and the growing--it doesn't rise with the cost of--
--
Mr. Rokita. No, I think that wasn't in your outline.
Because if you look at our plan, we are looking for a needs
test and we are calling for a risk test. Those of us who are
sicker would get more of it. Those of us who need less of it,
because of our stage in life or state in life, would get less
of a subsidy.
Secretary Sebelius. But, again, according to the
Congressional Budget Office, it is significantly less buying
power than Medicare provides right now for seniors. And,
actually, the buying power decreases over time, again,
according to the Congressional Budget Office. And they are
saying 10 to 15 years out 70 percent of the costs of health
care would be borne by the seniors themselves, not the----
Mr. Rokita. Right, but you come from State government like
I do. I was part of the executive branch of the Indiana
government. And so, you know, I come to this place not
believing everything CBO says, especially how they are
chartered. They are only allowed to look at exactly what is put
in front of them. And so we both know----
Secretary Sebelius. This was, if I understand it, the specs
given to them by the House Republicans, by Congressman Ryan.
Those were the only specs.
Mr. Rokita. As set forth in a previous act that they are
chartered by, and we can argue around all of that. But we both
know that we have a program that works for the Congress and we
both know people clamor and talk about how much or how good we
have it here in the Congress. And to see us argue now against
that for the rest of the American people, you know, I don't
understand----
But let me get on with some of my time.
Secretary Sebelius. Well, again, there is no evidence at
all that Medicare Advantage, which operates through private
market strategy, gives seniors choices, is either more cost
effective or more health effective. For seniors, in fact, the
cost is significantly higher and the health benefits are lower.
Mr. Rokita. Well, let me get on to an issue that you
didn't--as Dr. Bucshon was explaining you didn't seem to
understand the details. Here are some of the details.
Joe Main is the Assistant Secretary for Mine Safety, not
under your jurisdiction, of course, but he apparently used
something from a set of data from NIOSH to go after the coal
dust rule and to propose some things. Now he, on March 28,
wrote your office and said, please release this data. It is not
mine to release, but please get this to this committee and the
stakeholders involved so that we can participate better in this
rulemaking.
And so what I want to ask for you on the record, I think
you said it with Dr. Bucshon, you would be helpful in trying to
get that, right?
Secretary Sebelius. Absolutely. I don't know about that
issue.
Mr. Rokita. Understood. But, again, sharing your executive
experience, I can tell you have people behind you that you can
easily turn around to and say, what date can we get Congressman
Rokita some answers on this? Can you tell me how long----
Secretary Sebelius. I can't give you a date certain until I
know what it is that we are looking for, but I can guarantee
you all of us heard the question four or five times. We
understand there is a letter, and I will try to get it----
Mr. Rokita. You can get me a date as to when you will get
me the answer.
Secretary Sebelius. Sir, I really don't know what it is
that we are being asked to produce. I will get you an answer
very quickly.
Mr. Rokita. Yes, this is an answer about when it would
come. That is simple. So if it was me in your seat I would say,
you know, 24 hours or so. But give me whatever answer--just
tell me when you will give me that answer on when this stuff
might come.
Secretary Sebelius. I don't know what it is that you are
looking for, so I can't possibly give you--I will give you an
answer about when it will come, you know, within a couple of
days once I can talk to Dr. Howard.
Mr. Rokita. That is all I am looking for. I appreciate it.
Chairman Kline. The gentleman's time has expired.
Mr. Hinojosa, you are recognized.
Mr. Hinojosa. Thank you, Mr. Chairman.
Secretary Sebelius, thank you for joining us today to
discuss your priorities and to respond to the Ryan budget
proposal put forward by the Republican Party.
I am troubled by the Republican plan to end Medicare as we
know it. For my constituents in South Texas, the Republican
plan would be disastrous. It would force seniors into the
private sector for insurance, and it would force them to spend
more and more of their limited income on health care.
In regards to our Nation's youngest, just yesterday I sat
down in my office with a pediatric anesthesiologist struggling
to treat some of my district's most impoverished and vulnerable
youth, many of which are Medicaid beneficiaries. The Republican
plan slashing Medicaid is not the answer that providers or
children are looking for because it would unjustifiably hurt
access to quality care.
I wish to ask two questions. As the former insurance
commissioner and Governor of Kansas, you understand the heavy
burden of health care costs on seniors and families with
children in poverty. What is the Obama administration doing to
help bear that burden and what new strategies are being pursued
to help our most vulnerable populations?
Secretary Sebelius. Well, Congressman, I think the
President shares your concern about the access to care for the
most vulnerable Americans, and that is why I think he has
stated an opposition to the block grant idea with a fixed
amount of money available, knowing that you can't predict
recessions, you can't predict disasters, and you certainly
can't predict how many people are needing to access programs at
a difficult time, as we have just seen in this country.
The same would be true for Medicare, to change from what is
a guaranteed benefit program to a fixed-income situation, I
think, could provide an enormous cost shift onto seniors at a
time where they could least afford it and make it very, very
difficult to access life-saving care.
Mr. Hinojosa. With respect to Head Start, HHS is in the
process of implementing the new performance standards. Seeing
more parent and family engagement in our early education
services is very important to me. Will you please tell us how
these performance standards will strengthen the Head Start
program?
Secretary Sebelius. Well, Congressman, we are taking the
report on program integrity very seriously, and we think it is
important that the Head Start grantees follow the law, follow
the guidelines.
In addition, we are working closely with our education
partners to look at the range of skills that children need to
be school ready and making sure that, in addition to social
development, that there is a curriculum development as part of
the Head Start program. And certainly the parental involvement
piece, which has always been a hallmark of Head Start, is
something that is going to be strengthened and very critical
moving forward.
Mr. Hinojosa. Mr. Chairman, thank you for letting me ask
those questions. I yield back.
Chairman Kline. I thank the gentleman.
The timing is near perfect. I would like to thank the
Secretary for being with us and spending the time with us today
and putting up with the interruptions from the votes.
I would like to recognize Mr. Miller for any closing
comments he might have.
Mr. Miller. Thank you very much.
I want to thank the Secretary very much for being here.
I just want to say, after listening to your explanations
and your defense of the Affordable Care Act and when I see the
excitement and the response across the medical community and
the employer community to this legislation and to the
initiatives that you have started to roll out, it is really
very, very encouraging.
After the Affordable Care Act passed the Congress,
President Obama called me and said that I should be very proud,
as being one of the chairs of the committees for the major
jurisdiction on this legislation. I obviously told him I was
very proud.
But listening to your defense and your explanations here
and your initiatives on behalf of the law and the government, I
am even more proud than at that moment when we passed this
legislation. Because this is the kind of implementation that we
were hoping to see now. Hundreds of thousands of employees
being offered insurance by small businesses because of the tax
credit for the first time being reported all over the country
is really very exciting for those individuals and their
families. So thank you very much for your appearance here
before the committee.
Chairman Kline. I thank the gentleman.
It is always interesting. He and I must always talk to
different businessmen and women and different care providers. I
am not yet seeing that excitement on their part, and I don't
share that excitement with him, but I again very much
appreciate your time and your testimony here today.
There being no further business, the committee is
adjourned.
[Response to questions submitted for the record follow:]
Secretary Sebelius' Response to Questions Submitted for the Record
the honorable john kline
1. Head Start Fraud and Abuse. Last year, the U.S. Government
Accountability Office (GAO) conducted an undercover investigation of 15
Head Start programs, acting in response to tips from former and current
employees at two separate Head Start centers. Undercover GAO applicants
tried to enroll children in these programs and presented the centers
with pay stub data that demonstrated they were above income eligibility
requirements. Nine of the 15 sites enrolled the students by encouraging
applicants not to submit the pay stubs that would put them over the
income threshold. Some of the programs continued to count the students
as enrolled, even though the students never actually participated in
the program. At a May 2010 hearing before this Committee, the Assistant
Secretary for Children and Families stated that the Department was
taking immediate corrective action and was undertaking a ``top-to-
bottom'' review of its program oversight responsibilities. Can you give
us an update on the Department's effort to combat waste, fraud, and
abuse in the Head Start program? How many unannounced monitoring visits
has the Department conducted since the release of the GAO report? \1\
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\1\ http://www.gao.gov/new.items/d10733t.pdf
Answer: We have enhanced current monitoring procedures by
partnering with the HHS Office of the Inspector General and conducting
115 unannounced monitoring visits to Head Start and Early Head Start
programs, setting up a fraud hotline, and proposing new regulations to
strengthen the eligibility verification processes. These actions
include the following activities:
Completed a top-to-bottom review of our program monitoring
which includes ongoing oversight by Regional Program Managers and
staff, triennial reviews by monitoring teams, Erroneous Payment Study
and risk management process to make improvements in program oversight.
Established a complaint hotline to help identify problems.
The Office of Head Start has implemented a process to ensure complaints
are handled in a timely manner and appropriate actions are taken.
Proposed a regulation to strengthen the requirements on
eligibility verification for Head Start programs. Under the proposed
rule, grantees would be required to maintain the source documentation
used to verify income and obtain signatures from the person seeking
services and a grantee staff member attesting to the accuracy of the
information to the best of the person's knowledge. We expect to issue
the final rule this fall.
2. Recompetition of Head Start Grantees. In 2007, Congress passed
the Improving Head Start for School Readiness Act, which requires the
Secretary of Health and Human Services to establish a new,
comprehensive system to recompete Head Start and Early Start grants.
The Department is currently in the process of finalizing regulations on
recompetition to ensure that Head Start grantees are meeting the
requirements of the law and preparing pre-school-aged children for
entry into kindergarten. Please provide us with an update on this
process. When will the first grantees be re-evaluated?
Answer: In September 2010 we issued the Notice of Proposed
Rulemaking on the recompetition or Designation Renewal System and have
received over 16,000 comments. We are working expeditiously to review
those comments and finalize the regulation. We expect to issue the
final regulation this fall. The first grantees will be evaluated to
determine whether or not they need to compete for renewed funding
immediately following the effective date of the rule. We expect to
conduct the first re-competitions in early 2012.
3. Effectiveness of the Community Services Block Grant Program. The
President's FY2012 budget request includes a $388 million cut to the
Community Services Block Grant program, which is geared toward anti-
poverty activities. Over the last 10 years, a number of independent
studies and research activities, including those conducted by the U.S.
Government Accountability Office (GAO), have questioned the program's
effectiveness in combating poverty in local communities. What changes
do you think the Committee should make to the program to make it more
effective? When was the last time the program was evaluated and what
were the results?
Answer: The Community Services Block Grant (CSBG) program provides
a key component in addressing the causes and effects of poverty. For
grantees with a strong performance history, CSBG provides a valuable
source of ongoing support that allows local planning and service
delivery based on a place-based model. The Administration supports the
important goals of the CSBG and wants to work with Congress to inject
competition into the block grant in order to strengthen it and target
resources more effectively to high-performing, innovative
organizations.
We would be interested in working with the Congress on CSBG reform
based on the following principles for overall program direction:
Maintaining current emphasis on place-based services, by a
community-based entity to effectively address the causes and impact of
poverty;
Holding grantees more accountable for a high standard of
service delivery and performance;
Maintaining current CSBG distribution formula to States,
Territories, and Tribes;
Supporting State flexibility in designing competition
based on local need, agency performance records, and quality of
service, in consultation with the Federal administering agency;
Directing resources to agencies that can effectively serve
high need communities;
Promoting evidence-based practice to achieve results; and
Strengthening program integrity and accountability.
There are barriers in the current CSBG statute to this approach.
Section 676(b)(8) and section 678C require States to provide CSBG
eligible entities with funds proportional to what they received in a
prior year. Funds cannot be terminated or reduced unless, after
providing notice and an opportunity for a hearing on the record, the
State determines that cause exists. The current process for termination
is difficult and time consuming. Current law does not provide a
mechanism to rapidly respond to cases of alleged fraud. States usually
pursue termination only when there is a determination that the CSBG
eligible entity is grossly financially negligent. Outside of basic
financial and organizational management standards, States do not have
clear criteria for determining the adequacy of agencies' performance,
and the current process makes it difficult for states to hold grantees
accountable and target available resources based on need and service
delivery.
We continue to help States hold agencies accountable within the
current confines of the statute. We have issued guidance to States to
clarify the termination process to the extent possible under current
statute, and provide extensive technical assistance to States when they
choose to pursue termination. In addition, we have begun assessing the
current performance measurement system. However, statutory changes are
needed to improve both processes. We would like to work with you and
relevant stakeholders to develop a more efficient and effective system
to do more to hold grantees accountable and promote high performance.
We would also like to work with you to expand States' authority to
award CSBG grant funds through a competitive process and to give states
the flexibility to target resources based on need. Competition for
grants is currently allowable under the CSBG Act in certain limited
circumstances, including replacing agencies that are terminated due to
performance deficiencies. We believe that we can build on this existing
process as a method to ensure that high-performing entities receive
funding, and look forward to working with you and external stakeholders
to determine the best method for doing so.
Evaluation of CSBG
The Office of Community Services (OCS) has a study underway to
document the services provided, challenges addressed and
accomplishments achieved as a result of the $1 billion in ARRA funds
provided to the CSBG program. This process evaluation will identify
promising practices that could inform future Federal, State and local
program activities. OCS has contracted with the Urban Institute located
in Washington, D.C. to conduct this study, which will be completed by
February, 2012.
The Administration for Children and Families (ACF) has also made
program changes in response to reviews conducted by the Government
Accountability Office (GAO). A 2006 GAO report, titled ``Community
Services Block Grant Program: HHS Should Improve Oversight by Focusing
Monitoring and Assistance Efforts on Areas of High Risk'' (GAO 06-627)
called upon ACF to conduct a risk-based assessment of State CSBG
programs by systematically collecting and using information and to
establish policies and procedures to help ensure that on-site
monitoring is focused on States with the highest risk. In addition, the
GAO recommended that ACF issue additional guidance on State
responsibilities for monitoring and improve a strategic planning and
reporting on training and technical assistance efforts. It is important
to note that the GAO study focused primarily on program administration
issues, and did not include findings regarding the program's
effectiveness in combating poverty in local communities
Based on GAO's report, OCS has restructured its monitoring in a way
that heeds congressional intent, and improves management,
accountability and outcomes of State and local agencies in the
provision of CSBG services. The Health and Human Services (HHS) Office
of Inspector General (OIG), in studying the program in preparation for
administering the American Recovery and Reinvestment Act of 2009 (ARRA)
funding, looked at the adjustments made by OCS since 2006. In August
2009, the HHS OIG issued a report indicating that in all items included
in the IG review, the weaknesses cited by GAO had been addressed
(Source: A-01-09-02502: Status of the Office of Community Services'
Corrective Actions Resulting from the Government Accountability Office
Review of the Community Services Block Grant Program).
Since 1987, OCS has worked in partnership with the National
Association for State Community Services Programs (NASCSP) to support a
performance reporting system that aggregates reporting information from
State CSBG agencies an annual CSBG Information Survey (CSBG-IS).
Highlights of the 2009 annual survey result are available on the NASCSP
website at:
http://www.nascsp.org/data/files/csbg_publications/annual_reports/
highlights/2009/nascsp%2009%20csbg%20highlights_final.pdf
According to NASCSP results for 2009, CSBG agencies provided
services to 20.7 million low-income individuals, including nearly 5
million children, nearly 2.3 million seniors, and more than 1.7 million
people with disabilities. Based on an aggregate reporting measure used
to capture and describe services across 16 outcome areas, NASCSP
reports that the CSBG Network helped to reduce or eliminate 34.3
million ``conditions of poverty,'' as measured by outcomes such as:
gaining employment; building assets; and improving child development. A
detailed report based on the NASCSP Information Survey is available at:
http://www.nascsp.org/data/files/csbg_publications/annual_reports/
annual%20report%2009%20final.pdf.
OCS continues to work with NASCSP, its contract agencies, and other
partners to refine current performance measurement systems and develop
improved methodologies for performance measurement and accountability
in this important program.
4. Health Insurance Exchanges: You claim in your testimony that in
2014, state health insurance exchanges will provide new options for
consumers. However, it has been reported that several governors have
vetoed bills intended to implement the new law's requirement for state-
based Health Insurance Exchanges, and many states are not working
toward establishing such exchanges. Also, one governor rejected a $54
million ``early innovator'' grant for an exchange partly on the basis
that states do not want to be subjected to federal regulation. Assuming
some states will not create health insurance exchanges by 2014, at what
point will HHS develop the federal insurance exchange option that would
be available to consumers in those states? Can you elaborate on the
structure of this option?
Answer: The law requires that Exchanges, whether State-based or
Federally-facilitated, be operational by January 1, 2014. To date, 49
States have received exchange planning grants to develop plans for
Exchange operations. Some States are further along than others, and HHS
is actively assisting States as they work through implementation.
Additionally, some States have applied for more assistance through the
Establishment Grant process.
the honorable tim walberg
For nearly 20 years, the National Institute for Occupational Safety
and Health (NIOSH) along with the National Cancer Institute (NCI)
conducted a study on the potential effects of diesel exhaust in
underground mines. The Mining Awareness Resources Group (MARG)
voluntarily participated in the study by providing access and
information for NIOSH to conduct the study; however this was done with
the understanding that NIOSH would be providing the study data to the
group in order to review the studies. Two federal court orders have
ordered NIOSH to provide the data to MARG and the Committee on
Education and the Workforce, yet the institute has not fully complied.
1. Why has NIOSH not complied with the court orders of two federal
judges?
Answer: The Department has complied with the court orders in
connection with the litigation commenced by the Mining Awareness
Resource Group. We also understand that only one Federal court order,
issued by the U.S. District Court for the Western District of Louisiana
on June 5, 2001, ordered NIOSH to provide study data.
2. When will the data be made available to all parties involved?
Answer: Research data has been provided to the Committee as
requested and as it has become available. The mine operators that are
litigants have received research data consistent with their attorney's
execution of confidentiality agreements.
the honorable lou barletta
1. A number of smaller pharmacies in my district in Northeastern
Pennsylvania have raised concerns regarding the impact of ``rapid
refills'' on patient care. As you know, an increasing number of doctors
are issuing prescriptions for 90 day supplies of medication. However,
the patient's condition may change, forcing a doctor to modify the
prescription prior to the patient exhausting the huge supply.
Additionally, the patient loses out on valuable and more frequent in-
person counseling offered by local brick and mortar pharmacies. Can you
give the Agency's perspective on the challenges to patient care
associated with so-called ``rapid refills''? How has the Patient
Protection and Affordable Care Act interfered with this process?
Answer: The Affordable Care Act did not include provisions that
address rapid refills or physicians who provide patients with
prescriptions for 90-day supplies of medication. Physicians are able to
determine the appropriate treatment for each patient, including how
much medication or how many refills a patient should receive before a
follow up consultation.
the honorable phil roe
1. During our dialogue at the May 5, 2011, hearing of the Education
and the Workforce Committee, you stated that of the 30 million to 35
million Americans who will receive coverage as a result of PPACA,'' * *
* about 15 million are likely to be Medicaid-eligible.'' However
Medicare's chief actuary has indicated that the number of new Medicaid
enrollees could rise as high as 25 million given that Social Security
benefits will not be counted as income for the purpose of determining
Medicaid eligibility.\2\ How then, is PPACA not just a massive
expansion of Medicaid?
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\2\ See http://republicans.energycommerce.house.gov/Media/file/
Hearings/Health/033011/Foster.pdf
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Answer: We understand the Committee is interested in the
interaction between Social Security benefits and Medicaid for purposes
of eligibility determination for certain populations under the
Affordable Care Act, and we will provide more information to the
Committee under separate cover.
the honorable lynn woolsey
The HHS FY 12 budget proposes to zero out two programs in the
National Institute for Occupational Safety and Health (NIOSH): the
Education & Research Center (ERC) program and the Agriculture, Fishing
and Forestry (AFF) program. Combined, these two programs total less
than $50 million. The ERCs were established to implement Section 21 of
the Occupational Safety and Health Act's (OSHAct) requirement to train
``an adequate supply'' of occupational safety and health professionals
to implement the law.
With regard to the AFF program, fatality rates in agriculture,
fishing and forestry are more than seven times the average-and cost our
economy $4 billion per year. NIOSH has developed technology to save
lives and property in these industries. The National Academy of
Sciences (NAS) found this program conducts high priority, sound
research, but indicated that there were opportunities for improvement.
The HHS FY 12 budget request zeroes out the program, claiming the
program was ineffective, and asserts that the Agriculture Department
and the Labor Department can pick up the slack when this program is
zeroed out. The NAS panel members have written to Congress contending
that the HHS budget justification misrepresents their 2007 report.
1. What specific authorization and funding is available in the
Labor Department or Agriculture Department in the President's FY 12
budget to replace the NIOSH AFF research program?
Answer: HHS cannot comment on what specific authorization or
funding is available to other Federal agencies.
2. Will you be willing to review the budget justification for the
AFF program to determine if it is valid and factually supported?
Answer: The budget justification for the AFF program in the FY 2012
Budget was developed through a collaborative process within the
Administration and reflects the Administration's perspective.
3. Would you be willing to work with the Committee to identify
funds within HHS's operating divisions that could be reallocated to
allow this priority NIOSH work to continue?
Answer: The FY 2012 President's Budget represents the policy
priorities of the President and was developed in the context of
competing priorities. There are currently no plans within the
Administration to reallocate funds among HHS operating divisions.
4. With regards to the ERC program, the HHS FY 12 budget request
justifies termination on the grounds that NIOSH had planned to sunset
funding after 5 years; however, neither the Centers for Disease Control
nor OMB can find any documents to back this up. Congress never intended
to sunset this program after 5 years, and the Institute of Medicine
recommended continuing this program.
Has HHS conducted a recent assessment of whether the ERC program
has fulfilled its mission pursuant to Section 21 of the OSHAct? If so,
has such assessment determined that there is an adequate supply of
occupational safety and health professionals?
Answer: NIOSH commissioned a national workforce needs assessment
that was designed and implemented by an independent research firm and
guided by a multidisciplinary advisory task force of occupational
safety and health (OSH) professionals and practitioners, and included
public comment and input from major stakeholder groups. We expect to
release this assessment soon.
5. If such study had not been done, why would HHS terminate this
program before such assessment has been completed?
Answer: As noted in the response to Question #4, NIOSH commissioned
a national workforce needs assessment to assess the current supply and
future demand for OSH professionals in the United States and to
determine the professional competencies needed in these professions
over the next five years. The Administration recognizes the vital role
of occupational safety and health professional training. Within the
context of a budget that requires tough choices, the Administration put
forth a proposal to discontinue Federal funding for the ERCs.
6. Will you be willing to undertake a review to determine if the
budget justification for the ERC program is valid and fully supported?
Answer: The budget justification for the ERC program in the FY 2012
Budget was developed through a collaborative process within the
Administration and reflects the Administration's perspective.
7. Would you be willing to work with the Committee to identify
funds within HHS's operating divisions that could be reallocated to
allow this priority NIOSH work to continue?
Answer: The budget justification for the AFF program in the FY 2012
Budget was developed through a collaborative process within the
Administration and reflects the Administration's perspective.
the honorable carolyn mccarthy
1. Congress included a provision in the Patient Protection and
Affordable Care Act requiring that patients receiving Medicare home
health services have a face-to-face encounter with a referring
physician prior to certification for home health services.
Having heard from both home health care providers and physician
groups alike, I am concerned that in implementing the provision, CMS
has gone beyond Congressional intent. In doing so, the agency has
created significant additional administrative paperwork and
documentation burdens on physicians for which they are not reimbursed.
The requirement also creates obstacles to care for patients, who are by
definition homebound, and may not have convenient access to physician
offices.
I am very concerned that the outcome of this will be that patients
are denied access to the care they need, and that is provided in both
the lowest cost and most desired setting--one's own home.
We will continue to work with the agency, but would appreciate your
attention and thoughts on this matter as well. Would you support
efforts to streamline and simplify the process for documenting the face
to face encounter so that we address concerns of referring physicians,
home health providers, and the patients they serve?
Answer: We constantly strive to strike the delicate balance between
ensuring the integrity of the program and minimizing the administrative
burdens that are imposed. In the case of the home health face-to-face
encounter requirement, CMS made every effort to set up the necessary
administrative requirements and bounds within which they must be
completed, while allowing providers the flexibility to fulfill these
requirements in a manner that is right for them.
As a condition for payment, the Affordable Care Act mandates that
prior to certifying a patient's eligibility for the home health
benefit, the certifying physician must document that he or she, or an
allowed non-physician practitioner (NPP) has had a face-to-face
encounter with the patient beginning January 1, 2011.
CMS recognized that some providers needed additional time to
establish operational protocols necessary to comply with these
requirements and provided a measure of leeway for them. In addition,
CMS developed educational and outreach materials, reached out to state
and local associations, and held meetings with the industry, as well as
open door forums, to educate those affected by these requirements
during the first quarter of CY 2011. Long-standing regulations have
described the distinct content requirements for the plan of care (POC)
and certification for a beneficiary requiring home health. Providers
have the flexibility to implement the content requirements for both the
POC and certification in a manner that best makes sense for them.
As part of the certification form itself, or as an addendum to it,
the physician must document when the physician or allowed NPP saw the
patient, and document how the patient's clinical condition as seen
during that encounter supports the patient's homebound status and need
for skilled services.
Aside from allowing providers the flexibility to implement the
content requirements of the both the POC and certification in a manner
that makes sense for them, in order to reduce any obstacles to care,
there is an ample timeframe within which the face-to-face encounter
requirement must be met. The face-to-face encounter must occur within
the 90 days prior to the start of home health care, or within the 30
days after the start of care. Additionally, there is additional
flexibility to accommodate providers and beneficiaries in rural areas.
The face-to-face encounter can occur via telehealth, in rural areas, in
an approved originating site.
______
[Whereupon, at 12:45 p.m., the committee was adjourned.]