[House Hearing, 113 Congress]
[From the U.S. Government Publishing Office]



 
            PPACA IMPLEMENTATION FAILURES: ANSWERS FROM HHS

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

                                HEARING

                               BEFORE THE

                    COMMITTEE ON ENERGY AND COMMERCE

                        HOUSE OF REPRESENTATIVES

                    ONE HUNDRED THIRTEENTH CONGRESS

                             FIRST SESSION

                               __________

                            OCTOBER 30, 2013

                               __________

                           Serial No. 113-90


      Printed for the use of the Committee on Energy and Commerce

                        energycommerce.house.gov





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                    COMMITTEE ON ENERGY AND COMMERCE

                          FRED UPTON, Michigan
                                 Chairman
RALPH M. HALL, Texas                 HENRY A. WAXMAN, California
JOE BARTON, Texas                      Ranking Member
  Chairman Emeritus                  JOHN D. DINGELL, Michigan
ED WHITFIELD, Kentucky                 Chairman Emeritus
JOHN SHIMKUS, Illinois               FRANK PALLONE, Jr., New Jersey
JOSEPH R. PITTS, Pennsylvania        BOBBY L. RUSH, Illinois
GREG WALDEN, Oregon                  ANNA G. ESHOO, California
LEE TERRY, Nebraska                  ELIOT L. ENGEL, New York
MIKE ROGERS, Michigan                GENE GREEN, Texas
TIM MURPHY, Pennsylvania             DIANA DeGETTE, Colorado
MICHAEL C. BURGESS, Texas            LOIS CAPPS, California
MARSHA BLACKBURN, Tennessee          MICHAEL F. DOYLE, Pennsylvania
  Vice Chairman                      JANICE D. SCHAKOWSKY, Illinois
PHIL GINGREY, Georgia                JIM MATHESON, Utah
STEVE SCALISE, Louisiana             G.K. BUTTERFIELD, North Carolina
ROBERT E. LATTA, Ohio                JOHN BARROW, Georgia
CATHY McMORRIS RODGERS, Washington   DORIS O. MATSUI, California
GREGG HARPER, Mississippi            DONNA M. CHRISTENSEN, Virgin 
LEONARD LANCE, New Jersey                Islands
BILL CASSIDY, Louisiana              KATHY CASTOR, Florida
BRETT GUTHRIE, Kentucky              JOHN P. SARBANES, Maryland
PETE OLSON, Texas                    JERRY McNERNEY, California
DAVID B. McKINLEY, West Virginia     BRUCE L. BRALEY, Iowa
CORY GARDNER, Colorado               PETER WELCH, Vermont
MIKE POMPEO, Kansas                  BEN RAY LUJAN, New Mexico
ADAM KINZINGER, Illinois             PAUL TONKO, New York
H. MORGAN GRIFFITH, Virginia         JOHN A. YARMUTH, Kentucky
GUS M. BILIRAKIS, Florida
BILL JOHNSON, Missouri
BILLY LONG, Missouri
RENEE L. ELLMERS, North Carolina



                             C O N T E N T S

                              ----------                              
                                                                   Page
Hon. Fred Upton, a Representative in Congress from the State of 
  Michigan, opening statement....................................     2
    Prepared statement...........................................     3
Hon. Michael C. Burgess, a Representative in Congress from the 
  State of Texas, prepared statement.............................    49
Hon. Marsha Blackburn, a Representative in Congress from the 
  State of Tennessee, prepared statement.........................    88
Hon. Greg Walden, a Representative in Congress from the State of 
  Oregon, prepared statement.....................................    88

                               Witnesses

Kathleen Sebelius, Secretary, U.S. Department of Health and Human 
  Services.......................................................     5
    Prepared statement...........................................     8
    Answers to submitted questions...............................   147

                           Submitted material

Report entitled, ``Exposing the Anti-Obamacare Sabotage 
  Campaign,'' dated September 2013, by the Center for American 
  Progress Action Fund, submitted by Mr. Pallone.................    90
Documents submitted by Mr. Lujan.................................   115
Document binder..................................................   120


            PPACA IMPLEMENTATION FAILURES: ANSWERS FROM HHS

                              ----------                              


                      WEDNESDAY, OCTOBER 30, 2013

                  House of Representatives,
                  Committee on Energy and Commerce,
                                            Washington, DC.
    The committee met, pursuant to call, at 9:02 a.m., in room 
2123, Rayburn House Office Building, Hon. Fred Upton (chairman 
of the committee) presiding.
    Present: Representatives Upton, Hall, Barton, Whitfield, 
Shimkus, Pitts, Walden, Terry, Rogers, Murphy, Burgess, 
Blackburn, Gingrey, Scalise, Latta, McMorris Rodgers, Harper, 
Lance, Cassidy, Guthrie, Olson, McKinley, Gardner, Pompeo, 
Kinzinger, Griffith, Bilirakis, Johnson, Long, Ellmers, Waxman, 
Dingell, Pallone, Eshoo, Engel, Green, DeGette, Capps, Doyle, 
Schakowsky, Matheson, Butterfield, Barrow, Matsui, Christensen, 
Castor, Sarbanes, McNerney, Braley, Welch, Lujan, Tonko, and 
Yarmuth.
    Staff Present: Clay Alspach, Chief Counsel, Health; Carl 
Anderson, Counsel, Oversight; Gary Andres, Staff Director; Ray 
Baum, Senior Policy Advisor/Director of Coalitions; Mike 
Bloomquist, General Counsel; Sean Bonyun, Communications 
Director; Matt Bravo, Professional Staff Member; Megan Capiak, 
Staff Assistant; Karen Christian, Chief Counsel, Oversight; 
Noelle Clemente, Press Secretary; Paul Edattel, Professional 
Staff Member, Health; Brad Grantz, Policy Coordinator, O&I 
Sydne Harwick, Legislative Clerk; Brittany Havens, Legislative 
Clerk; Sean Hayes, Counsel, O&I Kirby Howard, Legislative 
Clerk; Alexa Marrero, Deputy Staff Director; Nick Magallanes, 
Policy Coordinator, CMT; Carly McWilliams, Professional Staff 
Member, Health; Brandon Mooney, Professional Staff Member; Gib 
Mullan, Chief Counsel, CMT; Katie Novaria, Professional Staff 
Member, Health; Monica Popp, Professional Staff Member, Health; 
Andrew Powaleny, Deputy Press Secretary; Chris Sarley, Policy 
Coordinator, Environment & Economy; Heidi Stirrup, Health 
Policy Coordinator; John Stone, Counsel, Oversight; Tim Torres, 
Deputy IT Director; Tom Wilbur, Digital Media Advisor; Jessica 
Wilkerson, Staff Assistant; Ziky Ababiya, Minority Staff 
Assistant; Phil Barnett, Minority Staff Director; Stacia 
Cardille, Minority Deputy Chief Counsel; Brian Cohen, Minority 
Staff Director, Oversight & Investigations/Senior Policy 
Advisor; Hannah Green, Minority Staff Assistant; Elizabeth 
Letter, Minority Assistant Press Secretary; Karen Lightfoot, 
Minority Communications Director and Senior Policy Advisor; 
Karen Nelson, Minority Deputy Committee Staff Director for 
Health; Stephen Salsbury, Minority Special Assistant; Roger 
Sherman, Minority Chief Counsel; and Matt Siegler, Minority 
Counsel.
    Mr. Upton. Good morning, everyone. Good morning.
    Secretary Sebelius. Good morning.

   OPENING STATEMENT OF HON. FRED UPTON, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF MICHIGAN

    Mr. Upton. Energy and Commerce Committee welcomes the 
President's point person on health care, Secretary Sebelius, as 
part of our continuing oversight of the healthcare law, and we 
look forward to a thoughtful conversation on a number of 
issues, including transparency and fairness.
    Over the months leading up to October 1 launch, the 
Secretary and her colleagues at HHS repeatedly looked us in the 
eye and testified that everything was on track, and despite the 
numerous red flags and lack of testing, they assured us that 
all systems were a go. But something happened along the way. 
Either those officials did not know how bad the situation was, 
or they did not disclose it. And sadly, here we are now 5 weeks 
into enrollment, and the news seems to get worse by the day.
    HealthCare.gov was down last night at 5 o'clock p.m. It was 
also down on Monday, and it crashed last weekend. And even this 
morning when we attempted to view the site before the hearing, 
we were hit with an error message.
    But this is more than just a Web site problem. That was 
supposed to be the easy part, remember? Americans were assured 
that their experience would be similar to other online 
transactions, like purchasing a flight or ordering a pizza, and 
that their sensitive personal information would always be 
secure. But after more than 3 years to prepare, malfunctions 
have become the norm, and the administration has pivoted from 
saying they're on track to setting a new target date of 
November 30th. And for those few Americans who have 
successfully applied, will the Web site glitches become 
provider glitches come January 1st?
    Americans are scared and frustrated, and this situation 
should rise above politics. Many folks at home watching us 
today have spent hours or even days trying to sign up. They 
continue to take time away from work or loved ones, but have 
made little progress, and soon they may worry about being on 
the wrong side of their government, facing potential penalties.
    I recently spoke to a woman from Buchanan, Michigan, who 
was excited to sign up, but has since become very disillusioned 
after spending hours on the phone and Web site with little 
success. There are also millions of Americans coast to coast 
who no doubt believed that the President repeated promises that 
if they liked their plan, that they would be able to keep it, 
no matter what. They are now receiving termination notices, and 
for those who lose their coverage, they like--they may be 
losing their faith in their government.
    Today's hearing is about fairness for the American people 
who are losing their coverage or seeing their premiums 
skyrocket as high as 400 percent. This hearing is also about 
transparency. While the administration continues to boast the 
number of Americans that have applied, they intentionally 
withhold precise enrollment numbers. Why? These numbers are 
critical to fully understand the status engaging the progress 
of implementation.
    Lead contractor CGI testified only last week that they had 
the data, but needed the administration's permission to release 
it. We asked the Secretary on October 8th for those figures, 
but we still have not received a response. We hope to get one 
today. The American people deserve answers as well as the peace 
of mind that promises will be kept. The Secretary has an 
opportunity today to embrace transparency and start restoring 
the public's faith in the administration and the government.
    [The prepared statement of Mr. Upton follows:]

                 Prepared statement of Hon. Fred Upton

    The Energy and Commerce Committee welcomes the president's 
point person on health care, Secretary Sebelius, as part of our 
continuing oversight of the health care law. We look forward to 
a thoughtful conversation on a number of issues including 
transparency and fairness.
    Over the months leading up to the October 1 launch, the 
secretary and her colleagues at HHS repeatedly looked us in the 
eye and testified that everything was on track. Despite the 
numerous red flags and lack of testing, they assured us that 
all systems were a go.
    But something happened along the way--either those 
officials did not know how bad the situation was, or they did 
not disclose it. Sadly, here we are, now five weeks into 
enrollment, and the news seems to get worse by the day. 
Healthcare.gov was down last night at 5:00 p.m. It was also 
down on Monday, and it crashed last weekend. And even this 
morning when we attempted to view the site before this hearing, 
we were hit with an error message.
    But this is more than just a Web site problem--that was 
supposed to be the easy part. Americans were assured their 
experience would be similar to other online transactions like 
purchasing a flight or ordering a pizza and that their 
sensitive personal information would be kept secure. But after 
more than three years to prepare, malfunctions have become the 
norm and the administration has pivoted from saying they are 
``on track'' to setting a new target date of November 30. And 
for those few Americans who have successfully applied, will the 
Web site glitches become provider glitches on January 1?
    Americans are scared and frustrated, and this situation 
should rise above politics. Many folks at home watching us 
today have spent hours or even days trying to sign up. They 
continue to take time away from work or loved ones but have 
made little progress, and soon they may worry about being on 
the wrong side of their government, facing potential penalties. 
I recently spoke to a woman from Buchanan, Michigan, who was 
excited to sign up, but has since become disillusioned after 
spending hours on the phone and Web site with little success. 
There are also millions of Americans coast to coast who no 
doubt believed the president's repeated promise that if they 
liked their plan, they'd be able to keep it ``no matter what.'' 
They are now receiving termination notices, and for those who 
lose the coverage they like, they may also be losing faith in 
their government.
    Today's hearing is about fairness for the American people 
who are losing their coverage or seeing their premiums 
skyrocket as high as 400 percent. This hearing is also about 
transparency. While the administration continues to boast the 
number of Americans that have ``applied,'' they intentionally 
withhold precise enrollment numbers. Why? These numbers are 
critical to fully understanding the status and gauging progress 
of implementation. Lead contractor CGI testified last week that 
they had the data, but needed the administration's permission 
to release it. We asked the Secretary on October 8 for those 
figures, but still have not received a response. We hope to get 
one today.
    The American people deserve answers as well as the peace of 
mind that promises will be kept. The secretary has an 
opportunity today to embrace transparency and start restoring 
the public's faith in the administration and government.

                                #  #  #

    Mr. Upton. I yield to my colleague, the ranking member of 
the committee, Mr. Waxman.
    Mr. Waxman. Thank you, Mr. Chairman.
    I am pleased Secretary Sebelius is here today. She's here 
to discuss the Affordable Care Act. Just like with Medicare 
Part D, the launch of the new Web site has not gone well, but 
just like Medicare Part D, the early glitches in this rollout 
will soon be forgotten.
    A lot of the discussion today will focus on that Web site. 
This is an important issue, and I want to learn what the 
Secretary can tell us about the problems being experienced and 
how they will be fixed.
    But we should keep this issue in perspective. The 
Affordable Care Act is working. It has been improving the 
health security of millions of Americans for the past 3 years. 
Because of the Affordable Care Act, more than 7 million people 
on Medicare have saved more than $8 billion on their 
prescription drugs. More than 100 million Americans have access 
to free preventive coverage and no longer face lifetime limits 
on their coverage. Over 10 million Americans have received 
rebates from insurance companies. And, finally, this January, 
the worst abuses of insurance industry will be halted. Never 
again will a family be denied coverage because their child has 
a chronic health condition. Never again will individuals see 
their premiums shoot up because they got sick or faced an 
unexpected medical expense. Never again will a woman have to 
pay twice as much as a man for the same insurance.
    That is why allowing insurers to continue offering 
deficient plans next year is such a bad policy. The law says 
that all plans except those that were grandfathered in 2010 
must meet the new consumer protection standards. If we don't 
enforce this policy, insurance companies can continue offering 
flimsy coverage that disappears when people actually need it. 
And no one should want that.
    It is understandable that there will be a focus today on 
what isn't working, but we must also remember what is working. 
The health insurance plans that are being offered in the 
exchanges are good plans; their premiums are much lower than 
expected. Sixty percent of the uninsured individuals shopping 
in the new marketplaces will be able to get coverage for less 
than $100 per month. Half of the young adults will be able to 
get coverage for less than $50 per month. And since Congress 
adopted the Affordable Care Act, healthcare costs across the 
whole economy have grown at their lowest level in decades.
    The success of the Affordable Care Act is due to the 
efforts of many people, but one individual more than any other 
is responsible for all the good that has been accomplished, and 
that is our witness today Secretary Sebelius.
    So I would urge my colleagues to stop hyperventilating. The 
problems with HealthCare.gov are unfortunate, and we should 
investigate them, but they will be fixed, and then every 
American will finally have access to affordable health 
insurance.
    Thank you, Mr. Chairman.
    Mr. Upton. Thank you.
    Before we swear in Secretary Sebelius, I want to clarify 
Energy and Commerce Committee practice for the swearing in of 
witnesses. The committee typically has two types of hearings, 
oversight hearings and hearings that focus on legislation and 
policy. Secretary Sebelius, for example, has testified 
previously before our committee to discuss issues related to 
the HHS budget or other policy matters. As is the case with all 
policy witnesses, Secretary Sebelius was not required to take 
the oath prior to testifying.
    Today's hearing is different. It is an oversight hearing. 
It is a long-standing committee practice to swear in all 
witnesses at oversight hearings, whether they be private 
citizens or Cabinet Secretaries.
    Mr. Waxman. Mr. Chairman, I thank you for your comments, 
and I just want to join you in simply explaining that swearing 
in of a witness before an oversight committee hearing has 
always been under oath. That is a standard procedure of this 
committee when we're conducting an oversight hearing. So it may 
seem strange to have the Secretary of Health and Human Services 
have to be sworn in, but all witnesses in an oversight hearing 
are sworn in, and that is our procedure.
    Mr. Upton. Thank you.
    So I would now like to introduce our witness for today's 
hearing. The Honorable Kathleen Sebelius is the Secretary of 
the Department of Health and Human Services. She was appointed 
to this position in April of 2009, and was sworn in as the 21st 
Secretary on April 28th, 2009.
    So I will now swear you in, if you would rise.
    As Ranking Waxman and I just discussed, the committee is 
holding an investigative hearing, and, when doing so, have had 
the practice of taking testimony under oath.
    Do you have any objection to testifying under oath?
    Secretary Sebelius. No, sir.
    [Witness sworn.]
    Mr. Upton. You are now under oath and subject to the 
penalties set forth in Title 18, section 1001 of the U.S. Code.
    You may now give a 5-minute summary of your written 
statement. Welcome again, and thank you for being here.

TESTIMONY OF HON. KATHLEEN SEBELIUS, SECRETARY, U.S. DEPARTMENT 
                  OF HEALTH AND HUMAN SERVICES

    Secretary Sebelius. Well, thank you, Chairman Upton.
    Mr. Upton. You got to use that mic. You don't know how many 
people want to hear you this morning.
    Secretary Sebelius. Thank you, Chairman Upton, Ranking 
Member Waxman, members of the committee.
    I left my position as Governor of Kansas 4 \1/2\ years ago 
for the opportunity to continue work I've been doing for most 
of my over 35 years of public service; to expand the 
opportunities for all Americans regardless of geography, or 
gender, or income to have affordable health coverage. During my 
years as a State legislator, as an elected insurance 
commissioner, as head of the National Association of Insurance 
Commissioners, and as a two-term Governor, and now as HHS 
Secretary, I have worked on that effort that I care deeply 
about.
    There are still millions of Americans who are uninsured as 
well as underinsured, people who have some coverage at some 
price for some illness, but have no real protection from 
financial ruin and no real confidence they'll be able to take 
care of themselves and their families if they have an accident 
or an illness. And for them a new day has finally come.
    In these early weeks access to HealthCare.gov has been a 
miserably frustrating experience for way too many Americans, 
including many who have waited years, in some cases their 
entire lives, for the security of health insurance. I am as 
frustrated and angry as anyone with the flawed launch of 
HealthCare.gov, so let me say directly to these Americans, you 
deserve better. I apologize. I'm accountable to you for fixing 
these problems, and I'm committed to earning your confidence 
back by fixing the site.
    We're working day and night and will continue until it's 
fixed. We've recently added new management talent, additional 
technical expertise, and a new general contractor to identify, 
prioritize, and manage fixes across the system in two broad 
categories: performance, which deals with speed and 
reliability; and function, which deals with bugs and problems 
in the system.
    Our extensive assessment has determined that HealthCare.gov 
is fixable, and I want to just outline a couple of the 
improvements we've made to date. We now have more users 
successfully creating accounts. We can process up to 17,000 
account registrations per hour, or nearly 5 per second. Instead 
of some of the users seeing a blank screen at the end of the 
application process, they can now see whether they're eligible 
for financial assistance and make more informed decisions. 
Because we've improved performance, customers can now shop for 
plans quickly; filtering plans takes seconds, not minutes. 
Users are getting fewer errors and timeout messages as they 
move through the application process. And the system has been 
strengthened with double the size of servers, software that's 
better optimized, and a high-capacity physical database which 
replaces a virtual system.
    The chairman referred to outages this weekend and again 
yesterday, and I would suggest to the committee that if you 
read the statement of Verizon, who hosts the cloud service, it 
is the Verizon server that failed, not HealthCare.gov, and it 
affected not only HHS, but other customers.
    We still have a lot of work to do. We have a plan in place 
to address key outstanding issues. It includes fixing bugs in 
software that prevented it from working the way it's supposed 
to, and refreshing the user experience so folks can navigate 
the site without encountering error messages, timeout, and slow 
response times. And by the end of November, we're committed 
that the vast majority of users will be able to review their 
options, shop for plans, and enroll in coverage without the 
problems way too many have been experiencing.
    But consumers are using the site every day and continue to 
do so, and problems are being solved, but we know that we don't 
have a fully functioning system that consumers need and 
deserve. We are still at the beginning of a 6-month open 
enrollment which extends through the end of March, and there's 
plenty of time to sign up. Just to put it in perspective, the 
average open enrollment for an insurance plan is 2 to 4 weeks. 
The new marketplace has a 26-week open enrollment, and those 
who enroll by December 15th will be able to access their 
benefits on day one.
    Even with the unacceptable problems with HealthCare.gov, 
which we are committed to fixing, the Affordable Care Act by 
any fair measure is working for millions of Americans who are 
benefiting from new health security, young adults, Americans 
living with preexisting health conditions, seniors on Medicare. 
The 85 percent of Americans who already have health coverage 
are protected with new rights and benefits. The 15 percent of 
our neighbors and friends who are uninsured have affordable new 
options in a competitive market. And cost growth for health 
care is lower than it's been in years.
    Millions of Americans are clearly eager to learn about 
their options and to finally achieve health security made 
possible by the Affordable Care Act. My commitment is to 
deliver on that promise.
    Thank you, Mr. Chairman.
    Mr. Upton. Well, thank you very much.
    
   [The prepared statement of Secretary Sebelius follows:]

    [GRAPHIC] [TIFF OMITTED]

    Mr. Upton. I appreciate you being here this morning, and we 
worked with our leadership to see that we don't have votes on 
the House floor this morning so we won't be interrupted. I 
appreciate your time for sure. And in an effort to allow every 
Member to ask a question, we're going to be reducing the time 
for questions to be just 4 minutes so that hopefully we can get 
through all the Members that are here. And I'm going to be 
pretty fast with the gavel, let me just say. So we've got 
plenty of questions, so let's try and get through them.
    You know, I think everyone in America remembers the 
President's words: ``If you like your healthcare plan, you can 
keep it. Period.'' Under the Affordable Care Act, insurance 
policies that were in effect on March 23rd, 2010, when the law 
was enacted, would be grandfathered. Then a few months later, 
despite the President's word, you all at HHS helped promulgate 
a new reg that in your own review showed that it effectively 
could deny perhaps as many as more than 50 percent, maybe even 
higher, of those holding individual policies, the right to 
renew their own insurance plan.
    And I would guess that there are a lot of us on this panel 
today that are hearing from angry and confused constituents, 
who are now being forced to go onto an inept Web site, whether 
they like it or not, to shop for a new replacement policy. 
They're finding premiums often more than 100 percent what they 
were paying before, some even as high as 400 percent, as I've 
heard from, and rising deductibles as well.
    So when was the President specifically informed of the 
regulation change? And, if so, was it pointed out that this 
totally undermines his biggest selling point?
    And I would note that on the screen in the statement that 
he made more than 3 years after the regulation change was 
promulgated, the President said again, ``So the first thing you 
need to know is this: If you already have health care, you 
don't have to do anything.''
    So he's been on the same page from the very start, yet the 
regulations changed months after the bill was enacted that are 
now causing perhaps millions of Americans to be denied the 
ability to renew their individual coverage.
    Why was that change made, and did the President know it?
    Secretary Sebelius. Well, Mr. Chairman, there was no 
change. The regulation involving grandfathered plans, which 
applied to both the employer market and the individual market, 
indicated that if a plan was in effect in March of 2010 stayed 
in effect without unduly burdening the consumer with reducing 
benefits and adding on huge costs, that plan would stay in 
effect and never have to comply with any of the regulations of 
the Affordable Care Act. That's what the grandfather clause 
said.
    The individual market, which affects about 12 million 
Americans, about 5 percent of the market, people move in and 
out, they often have coverage for less than a year, a third of 
them have coverage for about 6 months, and if a plan was in 
place in March of 2010, and again did not impose additional 
burdens on the consumer, they still have it. It's grandfathered 
in.
    Mr. Upton. But why not let the consumer decide whether they 
want to renew it or not? Why were regulations promulgated in 
the summer of 2010 that then undermined the ability for those 
folks to re-sign up, which is one the reasons for the large 
number of cancellation notices?
    Secretary Sebelius. There were no regulation change. We 
outlined the grandfather policy so people could keep their own 
plan. We then began to implement the other features of the 
Affordable Care Act. So if someone is buying a brand new policy 
in the individual market today or last week, they will have 
consumer protections for the first time. Many people in the 
individual market are medically underwritten. That will be 
illegal. Many women are charged 50 percent more than men. That 
will be illegal. You cannot again eliminate someone because of 
a preexisting health condition, you can't dump someone out or 
lock someone out.
    So those provisions--but if, again, a plan is in place and 
was in place at the time that the President signed the bill, 
and the consumer wants to keep the plan, those individuals are 
grandfathered in, and that's happening across the country in 
the individual market.
    Mr. Upton. We're learning, in fact, that folks who did have 
a plan who liked it, in fact, are being told that it's canceled 
in the last--my time has expired. Let me yield to the ranking 
member Mr. Waxman for 4 minutes.
    Mr. Waxman. Thank you, Mr. Chairman.
    I had to smile at your line of questioning because 
everybody expected this hearing was about the Web site. That's 
all we've been hearing about is the Web site.
    But that's not the only complaint we've been hearing about 
since the Affordable Care Act was adopted. We were told by our 
Republican friends that millions of jobs would be lost, and, in 
fact, there have been a gain of 7 million jobs. They said that 
the costs for health care would skyrocket, and, in fact, the 
opposite is true. They said there would be a massive shift to 
part-time jobs, and the evidence doesn't support that. They 
said tens of millions will lose their insurance, but, in fact, 
everybody in this country is going to have access to health 
insurance because they won't be discriminated against. They 
said that it would explode the deficit, and yet all the 
reputable organizations, like the Congressional Budget Office, 
have told us that it's going to save us $100 billion over 10 
years.
    So we've had a litany of objections from the Republicans 
about the Affordable Care Act, which has driven them to such a 
frenzy, they even closed the government.
    So now we have you before the committee. And you're being 
asked--I suppose later you'll be asked about the Web site. But 
let me pursue this question about individuals who have gotten 
notices that they're going to have their individual insurance 
policies canceled. They'll be able to get another plan, won't 
they?
    Secretary Sebelius. Actually, it's the law that they must 
get another plan. Continuous coverage is part of the law.
    Mr. Waxman. So----
    Secretary Sebelius. And that wasn't the case in the past.
    Mr. Waxman. So the Affordable Care Act, we're going to end 
the worst abuses of insurance companies, we're going to create 
consumer protections in the marketplace that they will be able 
to buy a policy even if they've been sick in the past, that 
women won't be charged more than men, that we're not going to 
let insurance companies deny coverage because of preexisting 
conditions, and we're not going to let them put these lifetime 
caps. And there will be an essential benefit package, so you're 
not just buying some things and not having other things 
covered, you're going to have the minimum that everybody should 
have: prescription drugs, mental health coverage, doctors and 
hospitals.
    Are these important consumer protections?
    Secretary Sebelius. Well, I would say, Mr. Waxman, they're 
very important. As a former insurance commissioner, I can tell 
you that the individual market in Kansas and anywhere in the 
country has never had consumer protections. People are on their 
own. They could be locked out, priced out, dumped out, and that 
happened each and every day. So this will finally provide the 
kind of protections that we all enjoy in our healthcare plans. 
As part of a group, as part of a plan that has prenegotiated 
benefits, we enjoy that kind of health security. And 
individuals buying insurance on their own, farm families, 
entrepreneurs mom-and-pop shops, young adults have never had 
that kind of health security.
    Mr. Waxman. Well, now they're going to have this health 
security. And most of the plans, as I understand it, that 
they're no longer going to be able to keep don't meet all the 
standards of the law.
    Secretary Sebelius. Well, again, I think you may have heard 
Pat Geraghty from Florida Blues, who was on some of the Sunday 
shows, and he talks about the fact that the Florida plans want 
to keep their customers. They have new plans to offer. They 
feel that a lot of people, and these are Mr. Geraghty's words, 
will have a much better plan at a similar or lower cost; 50 
percent of these 11 to 12 million people qualify for a subsidy, 
qualify for some financial help purchasing insurance for the 
first time ever.
    Mr. Waxman. The bottom line is that people with good 
coverage, like Medicare, Medicaid, employer coverage, can keep 
that. People with grandfathered plans in the individual market 
will be able to keep it. But if insurance companies sold you a 
new, modified health insurance policy after the date of the 
enactment that does not meet the law's standards, then those 
people will be able to go into the exchange and buy a real 
solid health insurance plan that won't discriminate against 
them or anybody else. I think that's a good result, I'm pleased 
with it, and I think most people will be as well.
    Mr. Upton. Gentleman's time has expired.
    The chair would recognize the vice chair of the committee 
Ms. Blackburn.
    Mrs. Blackburn. Thank you, Mr. Chairman.
    Madam Secretary, before, during, and after the law was 
passed, the President kept saying, ``If you like your 
healthcare plan, you can keep it.'' So is he keeping his 
promise?
    Secretary Sebelius. Yes, he is.
    Mrs. Blackburn. OK. What do you say to the 300,000 people 
in Florida you just mentioned or to the 28,000 in Tennessee 
that cannot get health insurance, their plans are terminated? 
Is he keeping his promise to them?
    Secretary Sebelius. Well, first of all, Congresswoman, they 
can get health insurance. They must be offered new plans, new 
options, either inside the marketplace, or if they don't 
qualify for a financial subsidy, they can shop in or out of the 
marketplace.
    Mrs. Blackburn. What do you say to----
    Secretary Sebelius. They absolutely will have new coverage.
    Mrs. Blackburn. What do you say to NBC News, who says 
millions are going to lose their coverage?
    Secretary Sebelius. In all deference to the press corps, 
many of whom are here today, I think that it's important to be 
accurate about what is going on, and I would defer again to the 
president of the Blues plan. People will have ongoing coverage, 
they will be offered new plans----
    Mrs. Blackburn. Madam Secretary, let me tell you 
something----
    Secretary Sebelius [continuing]. In the market right now 
will qualify----
    Mrs. Blackburn. What do you say to Mark and Lucinda in my 
district who had a plan, they liked it, it was affordable, but 
it is being terminated, and now they do not have health 
insurance?
    Secretary Sebelius. Insurance companies cancel individual 
policies year in and year out. They are a 1-year contract with 
individuals. They are not lifetime plans. They are not an 
employer plan. Your constituents will have lots have options in 
the market.
    Ms. Blackburn. It's what they wanted and I will remind you, 
some people like to drive a Ford, not a Ferrari, and some 
people like to drink out of a red Solo cup, not a crystal stem. 
You're taking away their choice.
    Let's put the screen shot up.
    I want to go to the cost of the Web site and talk about the 
Web site. This is what is happening right now with this Web 
site. We've had somebody in the back trying to sign on. It is 
down. It is not working.
    Last week I asked for the cost from each of the contractors 
that were with us last week. So can you give me a ballpark of 
what you have spent on this Web site that does not work that 
individuals cannot get to? What is your cost estimate?
    Secretary Sebelius. So far, Congresswoman, we have spent 
about $118 million on the Web site itself, and about $56 
million has been expended on other IT to support the Web.
    Ms. Blackburn. OK. Would you submit a detailed accounting 
of exactly what has been spent? And when do you expect 
constituents to stop getting these kind of error messages?
    Secretary Sebelius. Again, I talked to the president of 
Verizon over the weekend on two occasions. Verizon hosts the 
cloud, which is not part of the Web site; it is a host for a 
number of Web sites.
    Mrs. Blackburn. Right.
    Secretary Sebelius. The Verizon system was taken down 
Saturday night into Sunday. It was down almost all day Sunday. 
They had an additional problem that they notified us about 
yesterday, and it continues on. So I'd be happy to talk to the 
president of Verizon and get him to give you information about 
the Web site.
    Ms. Blackburn. Let me come back to that, because I want to 
get to this issue of exactly who was in charge of this project, 
because you're now blaming it on the contractors and saying 
it's Verizon's fault.
    So let me ask you this: Did you ever look at outsourcing 
the role of the system integrator? And obviously you did not, 
from the contractors that we had last week. You all--they had 
several different people, whether it was you, or Gary Cohen, or 
Michelle Snyder, or Henry Chao, that they thought were in 
charge. So who is responsible for overseeing this project? Is 
it you or your designee?
    Secretary Sebelius. Let me be clear, I'm not pointing 
fingers at Verizon, I'm trying to explain the way the site 
operates. We own the sites. The site has had serious problems. 
I know that----
    Ms. Blackburn. Who is in charge, Madam Secretary?
    Secretary Sebelius. The person now in charge as an 
integrator is QSSI, one of our----
    Ms. Blackburn. Who was in charge as it was being built----
    Secretary Sebelius. The CMS team was in charge up until----
    Ms. Blackburn. At that team, who is the individual----
    Secretary Sebelius. Michelle Snyder is the----
    Mrs. Blackburn. Michelle Snyder is the one responsible for 
this debacle.
    Secretary Sebelius. Well, excuse me, Congresswoman, 
Michelle Snyder is not responsible for the debacle. Hold me 
accountable for the debacle. I'm responsible.
    Mrs. Blackburn. OK. Thank you. I yield back.
    Mr. Upton. The chair recognizes Mr. Dingell from the great 
State of Michigan.
    Mr. Dingell. Thank you for your courtesy. I have a few 
questions I'll be asking on behalf of the Congresswoman Shea-
Porter, but I'll do that by writing. I ask unanimous consent 
that I be prepared to revise and extend my remarks.
    Mr. Upton. Without objection.
    Mr. Dingell. Mr. Chairman, I would like to begin by 
thanking you, welcoming the Secretary to a room in which her 
distinguished father, former Governor of Ohio, served for so 
many years.
    I begin my questions by quoting from an expert for whom I 
have enormous respect. He said as follows: ``As I mentioned 
earlier, the new benefits and its implementation are hardly 
perfect. Rather than trying to secure and to scare and confuse 
seniors, I would hope that we could work together as we go 
through the implementation phase to find out what is wrong with 
the program and if we can make some changes to fix it. Let us 
do it, and let us do it in a bipartisan fashion. It is too big 
a program and is too important to too many people to do that. 
But having said that, it does appear that it is working. Let us 
admit it, you know, and not keep beating a dead horse.'' My 
beloved friend Mr. Barton, who I think gave us the beginning of 
our efforts today.
    Madam Secretary, I've seen reports of consumers receiving 
plan cancellation notices from their insurance companies saying 
that plans are no longer available. Does the ACA require 
insurance companies to discontinue the plans that people had 
when the law was passed, yes or no?
    Secretary Sebelius. Not when the law was passed if the 
plans have not changed. No, sir. That's the grandfather clause.
    Mr. Dingell. Now, that's because the plans that existed 
prior to the passage of the law are grandfathered in, as you 
have said.
    Secretary Sebelius. That's correct.
    Mr. Dingell. So if an insurance company is no longer 
offering a certain plan, that's because that insurance company 
made a decision to change their policies, and that caused them 
to take away the grandfathered status from the insurance 
purchaser; is that right?
    Secretary Sebelius. That is correct.
    Mr. Dingell. Now, Madam Secretary, I want you to submit for 
the record a statement of what it is we can do about insurance 
companies that run around canceling the policies of their 
people. And I don't have time to get the answer, but I want to 
get a very clear statement from you as to what you can do so we 
can take some skin off some folks that have it coming.
    Secretary Sebelius. Again----
    Mr. Dingell. Madam Secretary, it's my understanding that 
these decisions of a business character are most common in the 
individual insurance market, and that much turnover already 
exists and existed prior to the enactment of the legislation.
    Secretary Sebelius. That's correct.
    Mr. Dingell. Is that correct?
    Secretary Sebelius. Yes, sir.
    Mr. Dingell. Is it correct that 35 to 67 percent of the 
enrollees in the individual market leave their plan after 1 
year for different reasons?
    Secretary Sebelius. A third are in about less than 6 months 
in the individual market, and over 50 percent are in for less 
than a year, yes, sir.
    Mr. Dingell. Now, in the cancellation letters which move 
around from the insurance companies, some insurance companies 
are suggesting an alternative plan at a higher price. Do they 
have the right to do that?
    Secretary Sebelius. Well, they have a right to do that, 
sir, but consumers have a right to shop anywhere to compare 
plans, and they have choices now that they've never had before 
and some financial assistance coming their way for about 50 
percent of those people.
    Mr. Dingell. And they have no right to enforce that----
    Secretary Sebelius. Oh, absolutely not.
    Mr. Dingell [continuing]. Demand on the insurance----
    Secretary Sebelius. No one is rolled over into a plan. And, 
in fact, individuals for the first time ever will have the 
ability to compare plans, to shop, and to make a choice inside 
or outside the marketplace.
    Mr. Dingell. Looks to me like the insurance companies are 
trying to inflict on their customers the view that this is 
their right, and that this is the only option available to 
them; is that correct?
    Secretary Sebelius. Well, I think that insurance companies 
would like to keep their customers. Having said that, customers 
for the first time have a lot of choices because they can't be 
locked out of the----
    Mr. Dingell. Companies have no right to enforce that view 
on the customer.
    Secretary Sebelius. There is no rule that says you have to 
stay with your company or you have to be rolled over.
    Mr. Dingell. And you don't have to believe them----
    Mr. Upton. Gentleman's time has expired.
    Mr. Dingell [continuing]. When they come forward and tell 
you that you've got to buy a particular policy; is that right?
    Secretary Sebelius. Absolutely.
    Mr. Upton. Gentleman's time has expired.
    The chair would recognize the gentlemen from Texas Mr. 
Barton.
    Mr. Barton. Thank you, Mr. Chairman. Before I ask my 
questions, we have a former member of the committee on the 
Democrat side from the great State of Kansas in the audience, 
Mr. Slattery. And we're glad to have you.
    And, Madam Secretary, we're glad to have you, too.
    Secretary Sebelius. Thank you, sir.
    Mr. Barton. There is a famous movie called The Wizard of 
Oz, and in The Wizard of Oz, there was a great line. Dorothy, 
at some point in the movie, turns to her little dog Toto and 
says, ``Toto, we're not in Kansas anymore.'' Well, Madam 
Secretary, while you're from Kansas, we're not in Kansas 
anymore. Some might say that we are actually in The Wizard of 
Oz land, given the parallel universes we appear to be 
habitating. Mr. Waxman and most of those on the Democrat side 
think things are great. You, apparently, although you did 
apologize, and you have said it's a debacle, you also seem to 
think that the Affordable Care Act is great. Well, myself and 
others have a different view. Ultimately the American people 
will decide.
    Now, last week, when the contractors were here, I focused 
my attention on the apparent lack of privacy in the Web site.
    If we'll put up the first slide that I had last week, if we 
can.
    This is what's public, Madam Secretary, and it's basically 
a disclaimer that says that any unauthorized attempt to upload 
information or change information on the Web site is 
prohibited. It really doesn't say anything about privacy. But 
you do have to accept that in order to go forward with the 
application.
    The next slide shows what's not public. This is in the 
source code. We tried to determine this morning if it was still 
in the source code, but it's been pointed out the Web site is 
down.
    This is much more, what I would say, frightening to me. It 
says you have no reasonable expectation of privacy regarding 
any communication or data transiting or stored on the 
information system. At any time and for any lawful government 
purpose, the government may monitor, intercept, search and 
seize any communication or data transiting or stored on the 
information system. Any communication or data transiting or 
stored on this information system may be disclosed or used for 
any lawful government purpose.
    Cheryl Campbell of CGI Federal said she was aware of it, 
but said that it wasn't her responsibility to put that in the 
source code. Were you aware of it, and was it your 
responsibility to put this in the source code?
    Secretary Sebelius. Mr. Barton, I did not put things in the 
source code. I can tell you it's my understanding that that is 
boilerplate language that should not have been in this 
particular contract because there are the highest security 
standards are in place, and people have every right to expect 
privacy.
    Mr. Barton. All right. Now, the last time we could check, 
this was still there. You're given almost unlimited authority 
under the Affordable Care Act to administer it. Will you commit 
to the committee and to the American people that, one, you do 
want to protect their privacy; and, two, you will take this 
out, fix it, make sure that it doesn't have bearing on people 
that try to apply through the Web site?
    Secretary Sebelius. Yes, sir. And we have had those 
discussions with CGI, and it is under way. I do absolutely 
commit to protecting the privacy of the American public, and we 
have asked them to remove that statement. It is there in error, 
it needs to be taken down, and we should be held accountable 
for protecting privacy.
    Mr. Barton. Well, thank you, Madam Secretary. I sincerely 
appreciate that, and I'm sure the American people do, too.
    My last question, or it's really a comment. I've introduced 
H.R. 3348, which says let's make this system voluntary for the 
first year, since we're having so many problems, and let the 
American people decide. What that means is if people choose not 
to participate, they would not be charged the penalty for 
nonparticipation.
    Would you support such a reasonable approach to this while 
we work out the problems in the system?
    Secretary Sebelius. No, sir.
    Mr. Barton. OK. Well, that's an honest answer.
    Mr. Upton. Gentleman's time has expired.
    Mr. Barton. Thank you, Madam Secretary.
    Mr. Upton. Chair would recognize the gentleman from New 
Jersey Mr. Pallone.
    Mr. Pallone. Thank you, Mr. Chairman.
    I know we're not in Kansas, but I do believe increasingly 
we're in Oz because of what I see here. So this ``Wizard of 
Oz'' comment by my colleague from Texas, I think, is 
particularly apropos given what we hear on the other side of 
the aisle.
    I don't know how you keep your cool, Madam Secretary, you 
know, with this continuous effort on the part of the GOP to 
sabotage the ACA, to scare people, and bring up red herrings. 
And I think that this privacy issue is another red herring, and 
I'm going to ask you a question about that.
    But before that I just wanted to say, this whole idea 
that's being brought up today that somehow, you know, policies 
are being canceled, and people don't have alternatives, it's 
just another red herring. You know, what I think my colleagues 
on the other side forget is that this is not socialized 
medicine; this is, in fact, private insurance in a competitive 
market. And if I'm an insurance company, and all of a sudden 
everyone else is selling a better policy with better benefits 
at a lower price, I can't continue to sell a lousy skeletal 
policy that doesn't provide benefits and costs more because 
I'll be out of the market.
    And so that's what's happening here. Insurance companies 
are canceling lousy policies with high prices because they 
can't compete, and that's what's going to happen when you have 
a private insurance market, which is what we have here. We 
don't have a government-controlled system; we have private 
markets. So I just wanted to make that point.
    But I have to drill down on what Mr. Barton said here. You 
know, before reform, the individual insurance market was 
dysfunctional, premiums would shoot up if people got sick, 
their coverage could be canceled if they had a preexisting 
condition, and they did not have secure quality coverage. Now, 
I've heard my Republican colleagues say that patient health 
information will be at risk in this application process, and 
this is flat out false. In fact, the ACA makes a giant leap 
forward for protecting health information by taking it 
completely out of the insurance application process, by banning 
discrimination based on preexisting conditions.
    Mr. Barton, again, is raising this red herring, just like 
the cancellation of insurance, by talking about privacy. But, 
Madam Secretary, prior to the ACA, when people applied for 
insurance coverage, did insurers make them provide a long, 
detailed, and basic medical history, but now, because the law 
bans discrimination based on preexisting conditions, 
individuals will not have to have provide this information in 
their applications? So regardless of this clause, please 
comment on the privacy issue and why it's irrelevant.
    Secretary Sebelius. Well, Mr. Pallone, in the past any 
individual American who was in an employer-based coverage, in 
government coverage like the ones we enjoy, in Medicare, in 
Medicaid, in the VA, a whole variety of plans, that's about 95 
percent of insured Americans, had no medical underwriting, had 
group protections, had consumer protections. The people who 
were outside that consumer-protected space were individuals 
buying they own coverage in an individual market. Medical 
underwriting, demanding health records, and often going through 
extensive doctor interviews and getting health records was a 
standard for that market. Pricing could vary widely depending 
on gender, depending on health condition. People could be 
denied coverage, and were frequently.
    That's the market that is currently being reformed with 
consumer protections. If a person had a policy in place in 
March of 2010, liked that policy, and the insurance company 
made no changes to disadvantage the consumer, those policies 
are in place, you keep your plan, you like it, and that goes 
on.
    For the people who, though, had a medically underwritten 
policy, were paying more than their neighbor because they 
happened to be female, could not get their health condition for 
a fixed hip written into their insurance plan, they will have a 
new day in a very competitive market. Twenty-five percent of 
the insurers are brand new to the market, and they are offering 
competitive plans.
    Mr. Pallone. Mr. Chairman, could I just ask that this 
document----
    Mr. Upton. Sure. Put it in the record. Without objection.
    Mr. Pallone. Thank you.
    [The information appears at the conclusion of the hearing.]
    Mr. Upton. The chair would recognize Mr. Hall.
    Mr. Hall. Thank you, Mr. Chairman.
    Madam Secretary, I think Congresswoman Blackburn asked you 
about the Federal Government, how much they spent today, and 
they are spending some money as we speak, aren't they? It's 
down right now, isn't it? You projected ongoing problems.
    Secretary Sebelius. I'm sorry, sir. I'm having a hard time 
hearing. What was the----
    Mr. Hall. She asked you how much it had spent today, and 
I'm asking what you expect to pay in addition to that on 
repairs that the Web site's going to require, and they're 
requiring them as we speak here. So those are things you 
projected, you knew they would happen, and they will happen. 
But you surely looked ahead, and you have some estimate of what 
is going to happen.
    Secretary Sebelius. Yes, sir.
    Mr. Hall. And going to cost.
    Secretary Sebelius. For our two major contractors, who are 
QSSI, a subsidiary of United, and for CGI, there are obligated 
amounts. For CGI, who is in charge of the entire application, 
there has been $197 million obligated, and that is to last 
through March of 2014. And as I said before, about $104 million 
has been expended in that obligated amount.
    Mr. Hall. I'm going try to be here in 2014 to be sure that 
your testimony is correct, OK?
    I'm just joking with you.
    Secretary Sebelius. OK.
    Mr. Hall. Were you born in Kansas? Meade, Kansas?
    Secretary Sebelius. I was not. I was born in Cincinnati, 
Ohio. I married a Kansan and went to Kansas.
    Mr. Hall. All right. I was in third grade there, and I 
thought I saw you on a tricycle there one day.
    Secretary Sebelius. Well, it was an illusion.
    Mr. Hall. Let me ask you a question. Have you ever rejected 
a financial bill from one of the contractors? Have you ever?
    Secretary Sebelius. Have I ever----
    Mr. Hall. Rejected a financial bill from one of them.
    Secretary Sebelius. Sir, again, our----
    Mr. Hall. Well, I guess you can say yes or no.
    Secretary Sebelius. Our accounting office does a routine 
audit and review of every bill that comes in before they do it. 
I do not personally. I want to be very accurate about I don't 
personally pay contracts, negotiate contracts. By law and by 
precedent, that's really illegal for someone who isn't a 
warranted contract officer to engage in the debate or 
discussion around Federal contracts.
    Mr. Hall. How much has the administration spent on the 
exchanges in total; not just HealthCare.gov, but all of the 
exchanges?
    Secretary Sebelius. I'm sure----
    Mr. Hall. How difficult is that figure to give me or if you 
can't give----
    Secretary Sebelius. I would like to get it to you in 
writing very quickly.
    Mr. Hall. Madam Secretary, I don't know how much time I've 
got left, but I'd like to talk about a couple of businesses in 
my district who are struggling with how to move forward. One is 
a manufacturer, and one is in the pet boarding and training 
business. One has 85 employees, and the other has 56. Here's 
some quotes from some of their recent letters.
    ``The situation we're in is we would have to pay $170,000 
in penalties under Obamacare. This is another example of the 
government picking winners and losers. We are the losers. 
There's no way I can be competitive if I have to raise my 
prices to cover $170,000. Here are my options: Do not pay the 
penalty, raise my prices, and go out of business, 85 people 
lose their jobs; layoff 35 employees who don't have to pay the 
penalty, and move more production to this country. Reduce 35 
jobs.''
    And here's a quote from the other: ``Since our high-labor, 
low-margin business cannot afford to pay for insurance for our 
employees, we're faced with either closing our business, 
perhaps through bankruptcy, so there are heavy financial 
obligations that would continue whether we operate or not; fire 
enough employees to get under 50 employees limits and close 
some of our business. Even if we close the location, we cannot 
escape many expenses such as rental agreements.''
    What am I supposed to tell these people?
    Secretary Sebelius. Well, sir, I think that in the employer 
market, about 95 percent of all American businesses are exempt 
from any kind of requirement to cover employer-employee 
insurance, and they are outside the law. They continue to be 
outside the law. But they will have some new options for those 
who want to cover their employees, and some new tax credit 
possibilities.
    For large employers, about 96 percent of them already cover 
their employees. And, as you know, the penalty that your 
constituents refer to is not a penalty that is imposed in 2014. 
It is being discussed with businesses about what kind of 
information is exchanged, and it will take place in 2015.
    Mr. Hall. I thank the----
    Mr. Upton. Gentleman's time has expired.
    Mr. Hall. He's going to use the gavel on me if you don't 
hush.
    Mr. Upton. Gentleman's time has expired.
    Mr. Hall. I yield back my time.
    Mr. Upton. The chair would recognize the gentlelady from 
California Ms. Eshoo.
    Ms. Eshoo. Thank you, Mr. Chairman.
    Welcome, Madam Secretary. You're a distinguished woman. You 
have distinguished yourself and your State, the offices that 
you've held, and now working for the American people, and I 
salute you for it.
    I want to really congratulate my Republican pals for being 
absolutely 1,000 percent consistent. You love what's wrong with 
the Web site, and you detest what's working in the Affordable 
Care Act. And I think that that is on full display here.
    But let's get back to the Web site, because that's what the 
hearing is about. It's my understanding that November 31st is a 
hard date for having everything up and running. Do you have--
now, HHS did testify in September that they were 100 percent 
confident that the site would be launched and fully functional 
on time on October 1st. That didn't work. Do you have full 
confidence in this new hard date?
    Secretary Sebelius. Congresswoman, I can tell you that the 
assessment that we have made is that it will take until the end 
of November for an optimally functioning Web site. I know that 
the only way I can restore confidence that we get it right is 
to get it right. So I--I have confidence, but I know that it 
isn't fair to ask the American people to take our word for it. 
I've got to fix this problem, and we are under way doing just 
that.
    Ms. Eshoo. But are you confident that--I think I said 
November 31st, which is----
    Secretary Sebelius. I thought it was a trick question.
    Ms. Eshoo [continuing]. Does not exist. But November 30th. 
You have confidence in November 30th?
    Secretary Sebelius. I do.
    Ms. Eshoo. Is there any penalty to QSSI or CGI for not 
delivering on what they promised?
    Secretary Sebelius. Well, I think the--as you can see, we 
have a--obligated funds for a contract. We certainly have not 
expended all these funds. And we expect not only the CMS team, 
but our contractor partners to fulfill their obligations and--
--
    Ms. Eshoo. But if they fail to fulfill their obligations--I 
don't know what's in the contract--is there a penalty?
    Secretary Sebelius. There isn't a built-in penalty, but I 
can tell you that paying for work that isn't complete is not 
something that we will do.
    QSSI, as you know, has taken on a new role as integrator. 
The hub that they built and have in operation is working 
extremely well not only for the Federal exchanges, but all the 
State-based markets are using the hub. And that's why we had 
confidence in their ability to actually take this next role on 
and coordinate the activities moving forward, which have to be 
driven with a very clear set of outcomes, very accountable 
timelines and deadlines, and they will be helping to manage 
that process.
    Ms. Eshoo. On the issue of security, there was a security 
breach that arose recently, that I read about at any rate. And 
what I think is very important here, because the issue of 
privacy has been raised, and I think that that has been 
answered, because, very importantly, there isn't any health 
information in these systems, but there is financial 
information.
    So my question to you is has a security wall been built, 
and are you confident that it is there, and that it will 
actually secure the financial information that applicants have 
to disclose?
    Secretary Sebelius. Yes, ma'am. I would tell you that there 
was not a breach. There was a blog by a sort of skilled hacker 
that if a certain series of incidents occurred, you could 
possibly get in and obtain somebody's personally identifiable--
--
    Ms. Eshoo. But isn't that telling? Isn't that telling?
    Secretary Sebelius. And we immediately corrected that 
problem. So there wasn't--it was a theoretical problem that was 
immediately fixed.
    I would tell you we are storing the minimum amount of data 
because we think that's very important. The hub is not a data 
collector. It is actually using data centers at the IRS, at 
Homeland Security, at Social Security to verify information, 
but it stores none of that data. So we----
    Ms. Eshoo. Thank you.
    Secretary Sebelius. So we don't want to be----
    Mr. Upton. The gentlelady's time has expired.
    The chair recognizes Mr. Shimkus.
    Mr. Shimkus. Thank you, Mr. Chairman.
    Welcome, Madam Secretary.
    Madam Secretary, before I start my questions, the 
Washington Post gave the administration and the President, 
yourself, four Pinocchios on this whole debate of if you like 
the insurance you have, you can keep it. Would you recommend to 
the president that he stop using that term? Wouldn't that be 
helpful in this debate?
    Secretary Sebelius. Well, sir, I think he used the term at 
the time that the law was passed, and he continued to say----
    Mr. Shimkus. And as of September 26th also, so----
    Secretary Sebelius. That is why we wrote the grandfather--
--
    Mr. Shimkus. So the answer is you don't buy--you don't 
believe that The Washington Post, and therefore----
    Secretary Sebelius. Well, I haven't read The Washington 
Post.
    Mr. Shimkus. Well, we'll hand this down to you----
    Secretary Sebelius. Thank you.
    Mr. Shimkus [continuing]. So you can see it. Have you ever 
shopped, I know you have, but this is at a grocery store with a 
coupon?
    Secretary Sebelius. Yes.
    Mr. Shimkus. Have you ever used a coupon?
    Secretary Sebelius. Yes.
    Mr. Shimkus. So the coupon gives you the terms and 
conditions of when you go to the checkout to get whatever is 
off the price of the goods. When you all added the ``See Plans 
Now'' option, you, in essence, gave the searcher, in essence, a 
coupon based upon what they're seeing there. The desire was, 
let people know what the price is; however, as the news 
reported, and I followed up in last week's hearing, was that if 
you are under 50 years old, you get quoted the price of someone 
who is 27. If you are older than 50, could be 64, you get 
quoted a price of someone who is 50 years old. Isn't that 
misleading?
    Secretary Sebelius. Well, sir, the learn side of the Web 
site, which has been up since actually late 20----
    Mr. Shimkus. So that is truthful, then? If you quote a 
price----
    Secretary Sebelius. It is clearly a hypothetical situation 
that allows people to----
    Mr. Shimkus. OK. On the ``See Plans Now'' option, are you 
saying this is a hypothetical? That is not what it says on the 
site. It says this is the price when you put in your age. And 
if your age is 49, it quotes you as if you are 27.
    Secretary Sebelius. Sir, the only way someone can get an 
accurate information about their price is to get their 
individual----
    Mr. Shimkus. Let me ask you another----
    Secretary Sebelius [continuing]. Eligibility determined.
    Mr. Shimkus. When did you decide to use this below 50 at 27 
and above 50 at 50 years old? When did you make that decision?
    Secretary Sebelius. That was decided by the team as we put 
up----
    Mr. Shimkus. By who? Who made the----
    Secretary Sebelius. I will get you that information.
    Mr. Shimkus. The problem with the whole debate is you all 
won't tell us who made the decision.
    Secretary Sebelius. I can tell you I did not design the 
site.
    Mr. Shimkus. So who?
    Secretary Sebelius. I will get the----
    Mr. Shimkus. Well, who made the decision on the 27-year-old 
quote for someone who is 50?
    Secretary Sebelius. I just said I will get you that 
information, sir.
    Mr. Shimkus. Thank you. Let me go to--because it is 
misleading, and the White House insists it didn't mislead the 
public, and of course, we find out that you did. Let me finish 
on this debate. It is another transparency issue. If someone, a 
constituent of mine or someone in this country, has strongly 
held pro life views----
    Voice. Oh, here we go.
    Mr. Shimkus [continuing]. Can you commit to us to make sure 
that the Federal exchanges that offer that is clearly 
identified and so people can understand if they are going to 
buy a policy that has abortion coverage or not? Because right 
now, you cannot make that determination.
    Secretary Sebelius. Sir, I--I don't know. I know exactly 
the issue you're talking about. I will check and make sure----
    Mr. Shimkus. Here's----
    Secretary Sebelius [continuing]. That----
    Mr. Shimkus. OK. Thank you.
    Secretary Sebelius [continuing]. Is clearly identifiable.
    Mr. Shimkus. Well, here's----
    Secretary Sebelius. You're saying----
    Mr. Shimkus. Here's our request. Can you provide for the 
committee the list of insurers in the Federal exchange who do 
not offer as part of their package abortion coverage?
    Secretary Sebelius. I think we can do that, sir.
    Mr. Shimkus. Well, you should be able to do it.
    Secretary Sebelius. I----
    Mr. Shimkus. So----
    Secretary Sebelius. I just said----
    Mr. Shimkus. No. You said if we can do it.
    Secretary Sebelius. No. I think we can do that, is what I 
said.
    Mr. Shimkus. I think or I know we can do it?
    Secretary Sebelius. Sir, I can't tell you what I don't know 
firmly right now. I know that is the plan. I will get that 
information to you. I----
    Mr. Upton. Gentleman's time has expired.
    The chair recognizes Mr. Engel from New York.
    Mr. Engel. Well, thank you, Mr. Chairman.
    Madam Secretary, I appreciate your coming today to answer 
questions about the Affordable Healthcare Act.
    You know, my Republican colleagues' actions here remind me 
a story I read when I was a little boy, and that is the story 
of Chicken Little, who ran around yelling, ``The sky is 
falling. The sky is falling,'' but unlike Chicken Little, my 
Republican colleagues are actually rooting for the sky to fall.
    Republicans are holding this hearing today under the 
auspices of an investigative hearing, as if they want to get to 
the bottom of what went wrong with the Web site in order to 
help fix it.
    But I don't think, Madam Secretary, there's one person in 
this room who is naive enough to actually think that the 
Republicans want to see this law work. They voted over 40 times 
to repeal the law. They shut down the government and threatened 
to force a default in order to stop it. They're rooting for 
failure.
    Madam Secretary, can you tell us what would be the impact 
on Americans' health insurance if Republicans had been 
successful in their efforts to defund or repeal the Affordable 
Care Act?
    Secretary Sebelius. Well, I think that the estimates of the 
Congressional Budget Office is that would have increased the 
deficit by about $110 billion in the first decade and close to 
a trillion dollars in the second decade. We know that we have 
42 or 43 million Americans without health insurance at all, 
some of them Medicaid eligible and some in the--over the 
Medicaid eligibility. Thirty governors so far, Republicans and 
Democrats, have declared their support for moving ahead with 
Medicaid expansion, but absent that, the Affordable Care Act, 
those folks would be without any kind of health security.
    And in the private market, what we know is it takes a real 
toll, but I'd say the biggest issue is not just the financial 
toll, not the community toll, not the country toll, which is 
significant. I have a good friend who runs the cancer center at 
the University of Kansas. I was with him and cancer researchers 
recently, and he said that if you get a cancer diagnosis, you 
are 60 percent more likely to live 5 years and beyond if you 
have insurance than if you don't. I think that's a pretty 
powerful statement for why we need affordable healthcare for 
all of our citizens.
    Mr. Engel. Well, thank you. The Republicans have not been 
able to defund or repeal it, but they have denied requested 
funding. They've raised specious arguments about death panels 
and socialized medicine. And they've worked to intimidate 
groups that could help the implementation effort. There has 
been the spreading of misinformation about the cost of 
coverage, we hear some of that today, and to actively dissuade 
the uninsured from seeking coverage.
    So, Madam Secretary, how have these tactics impacted your 
ability to implement the Affordable Care Act?
    Secretary Sebelius. Well, I don't think there's any 
question that a lot of people need a lot of information. I 
think it's one of the reasons we had millions visit the site, 
try to visit the site. It's why I am so frustrated and 
disappointed that the site is not fully functional and why I'm 
so committed to getting it functional, because clearly there is 
a demand. We need to get information to people about the law. 
This is the law. This is not any longer a debate. It was a law 
passed by both Houses of Congress, signed by the President of 
the United States, upheld by the Supreme Court. The president 
was reelected. It is the law, and people have benefits and 
rights under that law, and we've got to get that information so 
they can make good choices for themselves and their families.
    Mr. Engel. Well, thank you. It is the law, and frankly, I 
find it disconcerting that my Republican colleagues have done 
nothing but root for this law to fail for the last 3 and a half 
years, and now there's a big show here of being upset at 
problems with the Web site, of keeping people from signing up 
for coverage fast enough.
    So I would just say to my colleagues on the other side of 
the aisle, you're really on the wrong side of history here. The 
Web site will be fixed and millions of Americans will be able 
to get quality affordable health insurance coverage through the 
Affordable Care Act.
    And, again, I thank you for being here today, Madam.
    Mr. Upton. Mr. Pitts, chairman of the Health Committee.
    Mr. Pitts. Thank you, Mr. Chairman. Welcome, Madam 
Secretary.
    Secretary Sebelius. Mr. Pitts.
    Mr. Pitts. Have you personally tried to register or enroll 
on the Web site?
    Secretary Sebelius. Sir, I created an early lite account so 
I would see the prompts that were coming to people who were 
interested. I did work my way to the application feature fairly 
early on, but frankly, I have affordable healthcare, so I 
didn't try the eligibility.
    Mr. Pitts. No. I just wondered if you'd been through the 
process that millions of Americans are having to go through.
    Madam Secretary, the initial Web site crashes appear to be 
largely a result of the decision to prevent browsing of the 
plans. CGI Federal testified at our hearing last week that they 
had designed the Web site to allow users to browse and compare 
plans before having to create an account. Ms. Campbell told us 
that 2 weeks prior to the October 1st launch, they were told to 
turn off the browsing feature. Were you aware in September that 
this decision was made?
    Secretary Sebelius. Sir, I wasn't aware of that particular 
decision. That was made by the CMS team. I was aware that we 
were paring back some features to not put additional risk on 
the Web site. It seems----
    Mr. Pitts. And who made that decision?
    Secretary Sebelius [continuing]. Ironic at this point.
    Mr. Pitts. Who made that decision?
    Secretary Sebelius. Administrator Tavenner made that 
decision.
    Mr. Pitts. And do you know why that was made?
    Secretary Sebelius. Yes, sir. Because we were anxious to 
get the Web site up and running and functional, which we 
clearly have failed to do to date, although I would suggest the 
Web site has never crashed. It is functional but at a very slow 
speed and very low reliability and has continued to function.
    Having said that, they pared down some of the features, 
feeling that it would be better to load them in later. One was 
the shop-and-browse feature, another was the Spanish version of 
the Web site, and the Medicaid transfers. All three of those 
issues----
    Mr. Pitts. All right.
    Secretary Sebelius [continuing]. Were pared down in 
September----
    Mr. Pitts. Thank you.
    Secretary Sebelius [continuing]. To not load the system.
    Mr. Pitts. Thank you.
    Last week, CGI Federal and QSSI testified that CMS was 
responsible for end-to-end testing and that they believed that 
months of testing would have been preferable to 2 weeks. Do you 
believe that 2 weeks was enough time to complete testing of the 
entire system?
    Secretary Sebelius. Clearly not.
    Mr. Pitts. And when were you made aware of the result of 
the test, including the one where the system collapsed with 
only a few hundred users?
    Secretary Sebelius. Sir, leading up to the October 1st 
date, we had regular meetings with not only a team at CMS but 
administrators involved. I was made aware that we were testing, 
and as we found problems, we were fixing those problems. And I 
think there is a CGI report at mid-August identifying some 
problems. And between August and October, that became the punch 
list for CGI to fix those problems. That's why you test.
    Mr. Pitts. Now, in the Washington Post, on October 21st, 
there was an article that said about a month before the 
exchange opened, a testing group of 10 insurers urged agency 
officials not to launch the site, because it was riddled with 
problems. Were you aware in September that insurers recommended 
a delay in the launch of the exchange?
    Secretary Sebelius. I was not aware that they recommended 
delay. I know everyone was concerned that there were risks and 
there were likely to be problems with a brand new integrated 
insurance system. I don't think anyone ever estimated the 
degree to which we've had problems in the system, and certainly 
the contracting partners did not.
    Mr. Pitts. And did HHS respond to the insurers' 
recommendation to delay the launch?
    Secretary Sebelius. Sir, I wasn't in the meeting. I don't 
know what occurred in the meeting----
    Mr. Pitts. Can you find out----
    Secretary Sebelius [continuing]. And I don't know who they 
talked to.
    Mr. Pitts [continuing]. And answer that question for us?
    Secretary Sebelius. Sure. I will get back to you.
    Mr. Pitts. Thank you.
    Thank you, Mr. Chairman.
    Mr. Upton. Mr. Green.
    Mr. Green. Thank you, Mr. Chairman.
    Madam Secretary, thank you for taking time to be here 
today. I represent parts of eastern north Houston, Harris 
County, and our district has one of the highest uninsured rates 
in the country. Even worse, we have one of the highest rates of 
people who have jobs but don't receive their insurance through 
their employer. It's for this reason that I believe Houston 
would be a good place for you to come and spread the word about 
the tremendous benefits of the Affordable Care Act, however, we 
learned your offices--you're unable to attend because of 
scheduling conflicts. And hopefully we can have an agreement 
that sometime in the future you will come to the fourth largest 
city that probably has the highest number of uninsured in a 
metropolitan area. And, of course, we're in the State of the 
Texas, that has the highest uninsured in the country.
    It's important to me and our constituents to get it right, 
and that's why I share your and the President's disappointment 
the Web site is not working as planned. November 30th is not 
soon enough. Many of my constituents have been waiting for 
years to be able to purchase health insurance, and we owe it to 
them to get the marketplaces up and running. The contractors 
have not served our country well and should fix it or not be 
paid.
    Now we're hearing about the cancellation letters being sent 
by insurance companies to their customers notifying them that 
their plans are no longer offered.
    Are these Americans losing their healthcare coverage 
because of the Affordable Care Act, or is it because these 
plans were changed after the enactment of the act?
    Secretary Sebelius. I would say it's the latter, sir. If a 
plan was in place since the enactment of the act, no one would 
have received a cancellation letter.
    Mr. Green. So if somebody in America had an insurance plan 
before the act and the President was correct, if you like what 
you have, you could keep it.
    Secretary Sebelius. Yes, sir.
    Mr. Green. The plans were changed, and so now they have to 
comply with the new law.
    Secretary Sebelius. They could either choose to be 
grandfathered and keep the same plan, which meant the same 
benefits. And actually the regulation allows insurance 
companies to charge medical inflation, plus the trend line, so 
they didn't have to charge the same price; they could increase 
it. They could increase copays, they could increase 
coinsurance. What they couldn't do is cancel benefits that the 
policyholder relied on, they couldn't disadvantage the 
policyholder. But if that plan is in effect, absolutely, it is 
still in effect.
    Mr. Green. OK. But some of these millions of letters we're 
hearing about are probably because their plans changed after--
--
    Secretary Sebelius. Well, absolutely. And, again, in the 
individual market, plans change every year.
    Mr. Green. Yes.
    Secretary Sebelius. Insurers design new products.
    Mr. Green. Even in the small business market, that happens.
    These plans are not allowed now because they're completely 
inadequate; they don't offer the minimum essential benefits. Is 
that correct.
    Secretary Sebelius. That is correct.
    Mr. Green. OK. And having been a State legislator, and I 
know as Governor of Kansas, I assume every State has some type 
of minimum mandated benefits that they have for their health 
insurance plans.
    Secretary Sebelius. They do, but it applies, again, sir, in 
the past usually to the group markets, where 90 percent of 
covered Americans get their policies. This market has always 
been the Wild West.
    Mr. Green. OK.
    Secretary Sebelius. They didn't have protections.
    Mr. Green. The Americans who received those letters from 
their companies about cancellations, they're eligible to 
purchase plans on the exchange?
    Secretary Sebelius. Or out of the exchange. Individuals who 
aren't interested in some kind of financial help can go outside 
the exchange, inside the exchange. Their insurer can offer them 
plans. They have choices they've never had before.
    Mr. Green. And because of the benefits of the Affordable 
Care Act, 80 percent of their premium dollar will come back to 
them.
    Secretary Sebelius. That's correct.
    Mr. Green. OK.
    Secretary Sebelius. That's correct.
    Mr. Green. And that's not true. And I know it's not true in 
Texas, but I don't know any States that have that 80 percent 
requirement.
    Secretary Sebelius. Well, no State had it, I would suggest, 
in that kind of broad base prior to the Affordable Care Act. So 
it's an 80/20----
    Mr. Green. Let me give you an example of one of the plans I 
found out during case work a few years ago. A large company 
provided $25,000 maximum benefit for their employees in the 
year. Most of employees didn't know about it, and--until this 
one constituent found out that she had cancer, and the bill 
ended up being $300,000. And so that's some of those plans that 
are not being allowed to be sold now. Is that correct?
    Secretary Sebelius. Well, not only would the plan have a 
limit on out-of-pocket cost per year, it will have a limit on a 
lifetime out-of-pocket cost, and it will take away the notion 
that you would run out of your coverage in the middle of a 
treatment, which a lot of plans do.
    Mr. Green. I know I'm out of time, but it's like buying a 
car. It may look good, but if it doesn't have a motor, it's no 
good to have that car. So that's why the Affordable Care Act 
has----
    Secretary Sebelius. You save a lot of gas, but it doesn't 
get you anywhere.
    Mr. Upton. The gentleman's time has expired.
    The gentleman from Oregon, Mr. Walden.
    Mr. Walden. Thank you very much, Mr. Chairman.
    Governor, Secretary, we're delighted to have you before the 
committee. You and I both know how important this issue is to 
all Americans that we get it right. So I hope you can 
appreciate we're trying to understand what we missed along the 
way, and one of the things that bothered me was the letter that 
was sent from your agency to the GAO back in June 6th. And I'll 
read in part, it said, ``We're in the final stages of 
finalizing and testing the IT infrastructure that will support 
the application enrollment process. HHS is extremely confident 
that, on October 1, the marketplace will open on schedule and 
millions of Americans will have access to affordable, quality 
health insurance.''
    I'm just an average guy from a small town in Oregon. When I 
read that, it tells me you believed everything was good to go, 
the testing was in place and we should have full confidence 
everything would work. Correct?
    Secretary Sebelius. That's the letter I signed, yes, sir.
    Mr. Walden. Yes. Actually----
    Secretary Sebelius. Or whoever.
    Mr. Walden [continuing]. It was signed by your assistant.
    Secretary Sebelius. Yes.
    Mr. Walden. But----
    Secretary Sebelius. Yes.
    Mr. Walden [continuing]. The same point. And so I went into 
this believing in your response, your agency's response to GAO 
that things were ready to go, we should have full confidence, 
because when somebody uses the word ``extremely confident,'' it 
tells me you're extremely confident.
    Second piece. Then when we had the testimony from the 
witnesses last week, I asked them about the end-to-end testing 
and what the industry standard would be, and they said it 
really should have been months, especially for a project of 
this magnitude, and yet we heard it was only 2 weeks. Now, in 
August, GCI told CMS in their report----
    Secretary Sebelius. CGI.
    Mr. Walden. I'm sorry. CGI. Thank you. On August 9th, that 
there was not enough time in the schedule to conduct adequate 
performance testing. Did that make its way all the way to you, 
and do you think there was adequate time?
    Secretary Sebelius. Sir, clearly, as I've said before, we 
did not adequately do end-to-end testing. The products were not 
locked and loaded into the system until the third week in 
September. Each of the component parts----
    Mr. Walden. Right. They----
    Secretary Sebelius [continuing]. Was tested----
    Mr. Walden. They told us that.
    Secretary Sebelius [continuing]. Validated, independently 
validated----
    Mr. Walden. And so all of those----
    Secretary Sebelius [continuing]. But end-to-end----
    Mr. Walden. I'm sorry. All those worked, though, right? 
They told us last week that their individual modules were 
tested and met specification. Do you concur with that analysis, 
based on what you know?
    Secretary Sebelius. I do concur with the testing that was 
done, yes.
    Mr. Walden. OK. So it really was the end-to-end, which is 
why some of us thought we should delay until it could be done 
right, to avoid this very collapse that now is upon us. And I 
realize not everybody agreed to that.
    The second piece here gets back to the Washington Post, 
which I realize you haven't had, and I understand, a chance to 
read this morning, but the four Pinocchios about the President 
repeatedly saying if you have a plan, you will keep a plan. We 
all heard that to mean, I've got a plan with a company, I'll 
continue to have it even if they make minor changes, when in 
fact your own rules as written said, no, that really isn't 
what's going to happen. If minor changes are made, that means 
the plan changed; that means you don't get it.
    Secretary Sebelius. Well, sir, that isn't true. The rules 
did not say what you just suggested. And I think the estimate 
given that there would be turnover in the market was really an 
outside projection. It wasn't our rules. It was a snapshot of 
what happens in the market, that plans change so----
    Mr. Walden. Sure.
    Secretary Sebelius [continuing]. Dramatically----
    Mr. Walden. Every year.
    Secretary Sebelius [continuing]. Over time, that the 
estimate was they wouldn't be--not because of our rules, but 
because of insurance companies' business decisions----
    Mr. Walden. Well, but you set up----
    Secretary Sebelius [continuing]. Marketing plans.
    Mr. Walden [continuing]. What those market rules looked 
like they have to comply with, correct?
    Secretary Sebelius. Only if they chose not to grandfather 
the policy. That's the----
    Mr. Walden. But that meant they couldn't make any changes.
    Secretary Sebelius. Any grandfathered polices stayed in 
place still would be in place----
    Mr. Walden. Right. But not if they made----
    Secretary Sebelius. None of these rules apply.
    Mr. Walden. But if they made any change----
    Secretary Sebelius. No. They could make changes in pricing. 
They could make changes in benefits. They couldn't dramatically 
disadvantage the consumer, but they could have trend lines. 
They--they had a wide corridor to make sure that the--a similar 
plan--so if a consumer liked the plan, the plan, if it stayed 
in place----
    Mr. Walden. So here's what--the practical implication, I've 
got letters from constituents all over my district who have 
gotten letters from their insurers who say because of 
Obamacare, they're no longer going to be in the individual 
market, or at least with that plan in the individual market. 
And the result is this person from Cove, Oregon, said, I was 
paying $600 a month for a $3,000 deductible. Now it costs me 
$800 a month for a $5,000 deductible. I've got others here I'll 
put in the record. A woman whose job, she had 40 hours, now 
down to 29, neither has health insurance nor enough income to 
live on her own because of the way this law is getting 
implemented.
    I realize my time's expired.
    Mr. Upton. The gentlelady from Colorado, Ms. DeGette.
    Ms. DeGette. Thank you very much, Mr. Chairman.
    And thank you, Secretary, for being with us today.
    I want to follow up on a couple of those questions that Mr. 
Walden was asking you about CGI. As you know, Chairman Issa 
last night released this document, a monthly project status 
report from CGI last night. It looks to me it's sort of a 
technical document that has a punch list of outstanding open 
issues, and some of them do highlight items that upon first 
read seem to be alarming. For example, one of the entries that, 
due to the compressed schedule, there's not enough time built 
in to allow for adequate performance testing. And this 
certainly in retrospect sounds bad, but the day of the document 
that Chairman Issa released is September 6th. And then, on 
September 10th, 4 days later, CGI came in to this committee and 
testified under oath, quote, ``CGI Federal is confident it will 
deliver the functionality that CMS has directed.'' And we're--
we're trying to figure out, or at least I'm trying to figure 
out how CGI is now coming in and saying, you know, we warned 
everybody that this wasn't going to be ready, when they came in 
and directly told me that they would be ready to launch on 
October 1st.
    So it kind of raises the question how these statements can 
be reconciled. One explanation is that CGI was lying to this 
committee. I think that's unlikely. Another is that CGI thought 
that the items flagged in the report were like a punch list 
that could be addressed.
    So here's my question to you, Madam Secretary. Was CGI 
telling your department the same thing that they told the 
committee on September 10th, that the company was confident 
that its programs would be ready?
    Secretary Sebelius. Congresswoman, all of the contractors 
testified here in September and again, I think, last week 
before this committee, and the testimony was fairly similar, 
that they were ready to go in September. They were asked in--
last week if they had suggested that we should delay the launch 
date. Each of them said no. I think the chairman asked those 
questions.
    Ms. DeGette. So they never asked you to delay the launch 
date?
    Secretary Sebelius. They did not. And, frankly, I think it 
is not valuable at this point----
    Ms. DeGette. Right.
    Secretary Sebelius [continuing]. To do a lot of pointing 
blame, fixing the blame. What I want to do is fix the problem.
    Ms. DeGette. And so do I.
    Secretary Sebelius. I think we need the whole team to move 
ahead----
    Ms. DeGette. But----
    Secretary Sebelius [continuing]. And we will report back 
regularly.
    Ms. DeGette. Right. But we're relying on these 
contractors----
    Secretary Sebelius. I understand.
    Ms. DeGette [continuing]. To fix this. And so that goes to 
my last question, which is, Mr. Zients has now come in, and he 
says the site is going to be functional for the vast majority 
of users by the end of November. Is that right?
    Secretary Sebelius. That's correct.
    Ms. DeGette. And given what CGI told us, and the other 
vendors, do you believe that that is correct? Do you believe it 
will be pretty much ready to go by the end of November?
    Secretary Sebelius. I do. And I think that we are making 
improvements each and every day. It is easier to use now than 
it was 2 weeks ago. It is way from where we need it to be----
    Ms. DeGette. So it's not like it's all going to be fine by 
the end of November. It's beginning to improve already. Is that 
your testimony?
    Secretary Sebelius. It is a continuous process, as Web 
sites are. Patches are made, fixes are made on an ongoing 
basis.
    Ms. DeGette. Thank you.
    Secretary Sebelius. And as we find issues, like 
Congresswoman Eshoo talked about, we are fixing them in real-
time.
    Ms. DeGette. And you're going to guarantee, yes or no, that 
people will have privacy when they go on this site?
    Secretary Sebelius. Absolutely.
    Ms. DeGette. Now, I just want to say one last thing. I was 
on the Washington Journal program where callers call in this 
morning, and I had a man, Max, call in, and he said he got one 
of those letters from the insurance companies that his 
insurance was cancelled, so what he did is he went onto the Web 
site and he--under the Federal exchange, and he found a better 
plan, and now he's going to sign up. So I would hope that 
that's what everybody would be able to do.
    And I thank you, Mr. Chairman.
    Mr. Upton. Mr. Terry.
    Mr. Terry. Thank you, Mr. Chairman.
    And I'm pleased to hear that the Web site will be fully 
operational by the end of November. And would you be able to--
would you come back to our committee so we could see if that's 
actually accomplished and how it was accomplished?
    Secretary Sebelius. I will make every effort to do that.
    Mr. Terry. OK. You were Governor and State insurance 
commissioner in Kansas. And I reached out to our State 
insurance commissioner and Governor and found out that they 
have absolutely no data about Nebraskans who have either tried 
to enroll or enroll. As you know, Nebraska is one of the States 
that opted not to do their own exchange and rely on the Federal 
exchange. So it's interesting to me that neither our insurance 
commissioner nor the Governor's office had any data about 
Nebraskans and enrolling in these plans.
    I also asked our insurance commissioner if they knew who 
the navigators were and whether they had to apply to be 
certified or licensed, in essence like an insurance agent would 
be. And they told me they have no clue who's been authorized by 
HHS to be a navigator and work with people in Nebraska. So this 
is concerning to me, so I'm going to ask you a few questions 
along this line.
    First of all, do you have data on how many people in 
general in the United States have tried to enroll in a plan 
through this Web site?
    Secretary Sebelius. No, sir. We do not have any reliable 
data around enrollment, which is why we haven't given it to 
date.
    Mr. Terry. All right. Or have any data on how many people 
have tried to enroll but, because of the problems, have not 
been able to accomplish that?
    Secretary Sebelius. No, sir. I can tell you I met with 
insurers last week, and one of the priority fixes is the so-
called 834s, the document that----
    Mr. Terry. OK.
    Secretary Sebelius [continuing]. Sends an individual's 
name----
    Mr. Terry. The----
    Secretary Sebelius [continuing]. To a company and verifies 
it.
    Mr. Terry. But----
    Secretary Sebelius. That is one of the systems that is not 
working.
    Mr. Terry. I appreciate that. And the contractors I asked 
specifically about the information of how many people have 
tried to enroll and enroll, and they say that they do have 
those numbers, but can't tell us that because of a contract 
with HHS saying that they--they're gagged on that information.
    Secretary Sebelius. I would suggest----
    Mr. Terry. So could I----
    Secretary Sebelius [continuing]. That the numbers are not 
reliable according to the----
    Mr. Terry. Well, I tell you what----
    Secretary Sebelius [continuing]. Insurance agents and 
according to us.
    Mr. Terry. What my question is going to be, though, will 
you, on the record right now, authorize them to give us those 
numbers and let us determine whether those are reliable?
    Secretary Sebelius. No, sir. I want to give you----
    Mr. Terry. All right.
    Secretary Sebelius [continuing]. Reliable, confirmed data 
from every State and from the Federal marketplace. We have said 
that we will do that on a monthly basis by the middle----
    Mr. Terry. So----
    Secretary Sebelius [continuing]. Of the month. You will 
have that data, but I don't want to turn over anything that is 
not confirmed and reliable, and that's what we'll do.
    Mr. Terry. Well, but that data out there exists, and----
    Secretary Sebelius. Sir, I would----
    Mr. Terry [continuing]. You will not let us have it now.
    Secretary Sebelius. I would tell you right now it is not 
reliable data. According to the insurance companies who are 
eager----
    Mr. Terry. Well, the----
    Secretary Sebelius [continuing]. To have customers, they 
are not getting reliable data all the way through the system.
    Mr. Terry [continuing]. Number of people----
    Secretary Sebelius. It's one of the real problems that we 
have.
    Mr. Terry [continuing]. That have clicked on and tried to 
get it or enrolled, I'm not asking about what they enrolled in 
or whether they came in and said they were 65 and were quoted 
something that they were 27 years old. That should be a pretty 
reliable number just----
    Secretary Sebelius. The system----
    Mr. Terry [continuing]. On the surface, so would you----
    Secretary Sebelius [continuing]. Isn't functioning, so we 
are not getting that reliable data. Insurers----
    Mr. Terry. All right.
    Secretary Sebelius [continuing]. Who I met with said that 
that is the case. We know that there's 700,000 applications 
that have been----
    Mr. Terry. The reliability of that data certainly flies in 
the face of the testimony from the contractors.
    All right. I yield back.
    Mr. Upton. Ms. Capps.
    Mrs. Capps. Thank you, Mr. Chairman. Thank you, Secretary 
Sebelius, for your presence here today and your testimony.
    While I, too, am frustrated with the flawed rollout of 
HealthCare.gov, I do appreciate your longstanding commitment to 
improving the health care options for all Americans and in 
fixing this Web site quickly.
    I think it's important to note that in my home State of 
California and other States as well, the new exchange 
marketplace, we call it Covered California, is working. And 
rates, constituents are finding that rates are as much as 29 
percent less than those that they found on the marketplace last 
year. I'm thankful my constituents now have this option.
    And as I look around to implementation nationwide, it seems 
clear to me that political decisions in individual States have 
really made the difference for consumers. The governors and 
legislators, State legislators that embraced this law are 
delivering for their communities, but those elected who are 
trying to ignore the opportunities presented and continue to 
throw up roadblocks both here in Congress and in State 
legislators should not now seem surprised that there are 
significant bumps along the way.
    This seems to me to be completely disingenuous. Having 
embraced the law since open enrollment began October 1st, 
Californians have started nearly 180,000 applications, with 
more beginning every day.
    I know my time is limited, but I want to have a second to 
mention a conversation I had just last night with a telephone 
town hall to my district on the central coast of California. 
One of the first callers I heard from was a mother from Santa 
Barbara, her name's Meryl, and she wanted to tell me the story 
of her son. Her son is 28 years old and he had been paying $425 
a month for his insurance before the Affordable Care Act. She 
was happy to report that he has already applied through Covered 
California and has found a policy that works better for him and 
has all the essential health benefits covered, which his former 
policy did not, and now will only cost him $109 a month. This 
is significant savings for Meryl's son, and this is a story 
that's being repeated at least in California often.
    So there are millions of residents in many States who have 
now set up their own Web sites and marketplaces. In those 
States, tens of thousands of people are now as we speak signing 
up for coverage, and this is demonstrating that the Affordable 
Care Act is working.
    In New York and Washington, over 30,000 people have 
enrolled; in Oregon, over 50,000 people have been enrolled; 
Kentucky, 31,000 people have been enrolled. We could go on and 
on. The success of the State exchanges, which is where this is 
meant to be implemented, shows how badly this law is wanted and 
needed, how much it will be of help to so many people who want 
quality, affordable health care.
    So my three quick questions to you are this, Madam Speaker: 
What is your assessment of how this first month has gone in the 
States that are running their own marketplaces, which this 
Congress intended that the Affordable Care Act work?
    Secretary Sebelius. Well, everything we hear from the 
State-based markets is that they are doing well. They have not 
submitted data yet. We, again, are working with them around a 
monthly schedule so that they will confirm Medicaid data and 
enrollment data, and we'll see the real numbers at the end of 
the month and make sure that the--they're available to the 
public, but everything we hear is that they see the same 
demand, they are eager to enroll folks, and that that is going 
smoothly.
    Mrs. Capps. And what do you think this success shows about 
the demand and the interest for affordable health insurance on 
the part of constituents?
    Secretary Sebelius. Well, I don't think there's any 
question that in spite of a series of roadblocks and blockades 
and a lot of misinformation driven by about a $400 million 
marketing campaign last year, Americans are eager to see what 
their benefits may be under the law, what their opportunities 
are, how to get health security for themselves and their 
families. And we want to make sure that they see those 
benefits. The Web site is one of the ways to do that. The call 
center, on-the-ground enrollment, personal outreach are a 
variety of ways.
    And I would tell your colleague, Mr. Congressman, I'd be 
happy to get you the list of the Nebraska folks who are on the 
ground. It's available easily. It's public record. So I'd be 
happy to send it to you so you can share it with your insurance 
commissioner and governor.
    Mr. Terry. Thank you.
    Mr. Upton. The gentlelady's time is expired. The gentleman 
from the great State of Michigan, Mr. Rogers.
    Mr. Rogers. Thank you. I thank you, Madam Secretary, for 
being here. A short time, I'll get through some questions here 
if I can.
    Is it your testimony that every night to try to increase 
the functionality of the system, you're hot swapping codes? So 
my understanding is that between 2 and 4, write new code, put 
it into the system. Yes or no?
    Secretary Sebelius. Clearly I am not hot swapping code. 
There is a----
    Mr. Rogers. No, no.
    Secretary Sebelius [continuing]. Technical team that 
periodically----
    Mr. Rogers. You're in charge of the operation that hot 
swaps code on functionality. You're trying to improve the 
functionality. Yes?
    Secretary Sebelius. Yes.
    Mr. Rogers. So that happens every night. Yes?
    Secretary Sebelius. No. I don't think it does happen every 
night. It happens periodically during the hours of 1:00 and 
5:00, but it is not a nightly feature.
    Mr. Rogers. Great. Has each piece of that code that's been 
introduced into the system been security tested?
    Secretary Sebelius. That's my understanding, yes, sir. And 
the----
    Mr. Rogers. Each----
    Secretary Sebelius [continuing]. Testing----
    Mr. Rogers. Each piece of that code has been tested. Yes or 
no?
    Secretary Sebelius. I could not--I don't know----
    Mr. Rogers. OK. That's a----
    Secretary Sebelius [continuing]. But I can tell you that 
security----
    Mr. Rogers. That's a much safer answer, trust me.
    Secretary Sebelius [continuing]. Is an ongoing operation, 
that as code is loaded, you need to retest over and over and 
over again. So whether it's pre-tested, I can't tell you.
    Mr. Rogers. All right.
    Secretary Sebelius. I know----
    Mr. Rogers. You need to pre-test the code.
    Secretary Sebelius [continuing]. It is simultaneous----
    Mr. Rogers. Has any end-to-end security tests been 
conducted since HealthCare.gov went live on October 1st, yes or 
no?
    Secretary Sebelius. My understanding is there is continuous 
testing as the temporary authority to operate calls for.
    Mr. Rogers. Yes or no, has an end-to-end security test been 
conducted since HealthCare.gov went live, yes or no?
    Secretary Sebelius. I will find out exactly what testing 
they're doing. I know they're doing simultaneous testing as new 
code is loaded.
    Mr. Rogers. Are there any end-to-end security tests run 
after every new piece of code is put in--I'm not talking about 
testing the code now. I'm talking about an end-to-end security 
test----
    Secretary Sebelius. I can tell you how----
    Mr. Rogers [continuing]. That covers across the boundaries.
    Secretary Sebelius [continuing]. Frequently it's done----
    Mr. Rogers. Well, I can tell----
    Secretary Sebelius [continuing]. But I will get you that 
information from my techs.
    Mr. Rogers. I can tell you they're not, and I'd be 
interested to hear why not.
    If you'd go to Tab 2 quickly in your book, I'm going to 
read three things----
    Secretary Sebelius. I'm sorry. What book, sir?
    Mr. Rogers. You have to tab there that if you go toTab 2, 
right there--well, while you're looking, I'll read. It's dated 
September 27th and it is to Marilyn Tavenner. Let me just read 
a couple of pieces here. There are inherent security risks with 
not having all code tested in a single environment. Finally, 
the system requires rapid development and release of hot fixes 
and patches, so it is not always available or stable during the 
duration of the testing.
    Secondly, the security contractor has not been able to test 
all of the security controls in one complete version of the 
system.
    And if you look in the first part, which is most troubling 
of all, it says, due to system readiness issues, the security 
control assessment was only partly completed. This constitutes 
a risk that must be accepted before the marketplace day one 
operations.
    And so let me tell you what you did. You allowed the system 
to go forward with no encryption on backup systems. They had no 
encryption on certain boundary crossings. You accepted a risk 
on behalf of every user of this computer that put their 
personal financial information at risk because you did not even 
have the most basic end-to-end tests on security of this 
system.
    Amazon would never do this, ProFlowers would never do this, 
Kayak would never do this. This is completely an unacceptable 
level of security. And here's the scary part: We found out 
after the contractors last week that an end-to-end test hadn't 
been conducted on security, not functionality, because if it's 
not functioning, it's not secure. You are ongoing hot patches 
without end-to-end tests. The private contractors told us it 
would take a very thorough 2 months just for an integrated end-
to-end security test that I'll tell you has not happened today. 
Why? Because you're constantly adding new code every night to 
protect the functionality of the system. You have exposed 
millions of Americans because you all, according to your memo, 
believed it was an acceptable risk. Don't you think you had the 
obligation to tell the American people that we're going to put 
you in the system, but beware, your information is likely to be 
vulnerable? Would you commit today, Secretary, to shut down the 
system and give an end-to-end security test so that these 
Americans----
    Secretary Sebelius. No, sir.
    Mr. Rogers [continuing]. Could have their information?
    Secretary Sebelius. If you read the memo----
    Mr. Rogers. Oh, I have read it.
    Secretary Sebelius [continuing]. It goes on to say that 
weekly testing of our Brda devices, including interface 
testing, daily, weekly scans are going on. This is a temporary 
authority----
    Mr. Rogers. Candidly, that's not what the memo says----
    Secretary Sebelius [continuing]. A temporary----
    Mr. Rogers [continuing]. Number one----
    Secretary Sebelius. It does.
    Mr. Rogers [continuing]. And number two, the contractors 
will tell you this is----
    Mr. Waxman. Mr. Chairman, a point of order.
    Mr. Upton. The gentleman----
    Mr. Waxman. I think the witness ought to be allowed to 
answer what was a speech by the colleague, because he's raised 
a lot of issues.
    Mr. Upton. If the gentlelady will answer, we'll move----
    Mr. Rogers. You mean there's----
    Mr. Upton [continuing]. We'll move----
    Mr. Rogers [continuing]. Giving speeches here today? That's 
shocking.
    Mr. Upton. Does the Secretary wish to respond briefly?
    Secretary Sebelius. Sir, I would just say this document is 
a document signed by Administrator Tavenner which discusses 
mitigation strategies for security that are ongoing and 
upgraded, and an authorization to operate on a permanent basis 
will not be signed until these mitigation strategies are 
satisfied. It is underway right now, but daily and weekly 
monitoring and testing is underway.
    Mr. Rogers. Mr. Chairman, there are people using this 
system today, and she's just admitted again the system isn't 
secure nor has it been----
    Secretary Sebelius. I did not say that, sir.
    Mr. Waxman. Mr. Chairman, she didn't admit that. You said 
it, but she didn't say it.
    Mr. Upton. Gentleman's time is expired, Mr. Doyle.
    Mr. Doyle. Thank you, Mr. Chairman. Madam Secretary, 
welcome. Those of us who fought for this law, who voted for 
this law have a vested interest in its success, and the 
concerns that you hear expressed on this side of the panel are 
real, because we want to see Americans get health care. I think 
it's somewhat disingenuous for my colleagues on the other side 
of the podium here to have this faux anger and this faux 
concern over a bill that they absolutely want to fail and have 
rooted for its failure and have voted over 40-some times to 
repeal this bill, never putting an alternative plan on the 
floor for the American people, but just to simply say they want 
to make sure this plan doesn't succeed.
    And I think their real fear is that the plan will succeed 
and the American people will learn of the real benefits of this 
plan, not the propaganda campaign that's gone on by the 
Republicans for the last 3 years.
    Madam Secretary, I think one of the keys to the success of 
this plan is that we get young people to enroll in this plan, 
and I have some questions about some enrollment concerns. Now, 
I understand that you've said approximately 700,000 people have 
applied for coverage via the HealthCare.gov and the State 
exchanges. Is that----
    Secretary Sebelius. They've completed an application.
    Mr. Doyle. Right. Which is different from enrollment.
    Secretary Sebelius. That's correct.
    Mr. Doyle. So my question is, are you expecting--I know you 
don't have exact numbers yet, but are you expecting a large 
number or a small number of enrollments during the first month? 
What are your thoughts on that?
    Secretary Sebelius. Well, our projections prior to launch 
were always that there would be a very small number at the 
beginning. We watched the Massachusetts trend, which started 
slowly and built. I think there's no question that given our 
flawed launch of HealthCare.gov, it will be a very small 
number.
    Mr. Doyle. Yes. I mean, in the Massachusetts plan, I think 
the first month, it was 123 people signed up, less than 1 
percent of the overall first year enrollment in that first 
month. And we saw the same kind of numbers in Medicare Part D 
the first month of open enrollment back in 2006.
    Madam Secretary, young Americans are the most likely age 
group to be uninsured, and a lot of us are concerned that 
because of the problems that we've been having with the Web 
site, that a lot of these young folks may not come back on. You 
know, they have very short attention spans. I've got four kids 
that all work on the Internet, and if they can't get something 
in 5 minutes, they're on to something else.
    What do we do and what plans are in place by your 
department to encourage young people to go back and revisit 
that site and to make sure that we're getting young people 
looking at that site and accessing it?
    Secretary Sebelius. Well, step number one is fix the site, 
because we don't want people to be invited back and then have a 
bad experience a second time around. I think that's absolutely 
right. The site is particularly important to tech savvy younger 
generation folks, who we need to enroll. I think that we have--
so fixing the site is step one, and step number two is getting 
information to folks that the law even exists. A lot of young 
people haven't followed this dialogue for the last 3-\1/2\ 
years or been paying attention----
    Mr. Doyle. Yes. I think we need a real----
    Secretary Sebelius [continuing]. And think they don't need 
health insurance.
    Mr. Doyle [continuing]. A real marketing campaign and we 
need to really reach out to----
    Secretary Sebelius. Yes.
    Mr. Doyle [continuing]. Young people----
    Secretary Sebelius. We intend to do that.
    Mr. Doyle [continuing]. Especially at the end of November, 
when you say this site is going to be working a lot better, to 
make sure they're checking that site out.
    Secretary Sebelius. You bet.
    Mr. Doyle. One of my four kids is self-employed. He's 33 
years old. He's paying about $140 a month right now for a Blue 
Cross plan. He's eligible for a subsidy. We browsed that site. 
He's going to be able to get coverage for about half of what 
he's paying right now. And that's good news for us, because I 
think my wife is paying his premiums, so I think we're going to 
save the money.
    Secretary Sebelius. Well, I would----
    Mr. Doyle. But I think it's important--we had to prod him 
to go on that site and enroll. And I think for a lot of young 
people, they're not going to do it unless it's easy, so it's 
important we get that fixed. Thank you.
    Secretary Sebelius. I agree.
    Mr. Upton. Dr. Murphy, chairman of the Oversight 
Subcommittee.
    Mr. Murphy. Thank you, Madam Secretary, and welcome. You 
had mentioned that the people who did technology on the Web 
site made a number of mistakes. You mentioned Verizon. When we 
had them before our committee last week, they said it wasn't 
their fault, they were told, but then HHS, there were some 
problems there.
    Secretary Sebelius. Sir, Verizon wasn't involved in the Web 
site.
    Mr. Murphy. I----
    Secretary Sebelius. Verizon hosts the cloud.
    Mr. Murphy. Right. With the data.
    Secretary Sebelius. I just need to clear that up.
    Mr. Murphy. I understand that.
    Secretary Sebelius. They were--not the Web site.
    Mr. Murphy. But they had a role, CGI had a role, over 
companies, et cetera. I'm just curious in this process, what 
decisions did you make that affected this, for better or worse, 
in terms of the data, the ease or problems with the moment and 
being able to track how many people are actually enrolled?
    Secretary Sebelius. My decisions, specifically to design 
the Web site, I was not involved. I am prohibited to choose 
contractors. We go by the----
    Mr. Murphy. OK.
    Secretary Sebelius [continuing]. Federal procurement, and I 
got regular reports on exactly what was done and how it was----
    Mr. Murphy. What about the part with regard to getting data 
in terms of how many are people even enrolled or trying to 
enroll? Did you have any decisions in that process?
    Secretary Sebelius. Again, the application process at this 
point does not work end-to-end very well----
    Mr. Murphy. Right. I understand it doesn't work. That's 
obvious.
    Secretary Sebelius [continuing]. And we do not have 
reliable data about the end----
    Mr. Murphy. I'm just trying to find out if you had asked 
them to say, look, I'm in charge of this. I'm going to want a 
regular report. How many people have tried to enroll, how many 
people have enrolled. Have you--did you ask that question in 
the plan?
    Secretary Sebelius. We have prioritized for our contractors 
that specific fix. And believe me, the insurance companies are 
eager for us to get reliable data to make sure----
    Mr. Murphy. I'm just trying to----
    Secretary Sebelius [continuing]. That their data matches 
ours, and that is not there yet.
    Mr. Murphy. I appreciate that. I'm just trying to find out 
if you've told them that was part of the plan and what they're 
doing.
    Real quick. We're hearing from thousands of people who have 
had their policies cancelled. In fact, I heard from one insurer 
in Pittsburgh that just cancelled 30,000 individual policies. 
Now, they said they expect 50,000 to 30,000 to enroll in the 
exchange plans. Just so you know, to date so far the number of 
people who have signed up for their plan is 10, 10.
    Now, I'm concerned a lot of these individuals and their 
families aren't going to be make it by January 1, so I'm 
wondering, do you know how many families will not have been 
able to keep their insurance by January 1? Do you have any 
matrix that can help you understand what that number's going to 
be?
    Secretary Sebelius. Sir, by law that has been in place for 
a while at the State level, insurance companies must give their 
customers a 90-day notice about a policy change----
    Mr. Murphy. Right.
    Secretary Sebelius [continuing]. Or a plan cancellation, 90 
days.
    Mr. Murphy. I'm just wondering if you have a mechanism 
whereby you will know. Is something built into the system 
whereby you be----
    Secretary Sebelius. Will I know if your constituent signed 
up for an individual plan? No.
    Mr. Murphy. People across America. And do we know how many 
policies will be cancelled or be enrolled? I mean, is it 1,000? 
10,000? 1 million? 5 million? Do we know?
    Secretary Sebelius. We know that in the individual market, 
a number of the plans being sold are not grandfathered and are 
not currently meeting the law. Those notices have gone out. We 
know that there are about 12 million people in the individual 
market. A number of them have grandfathered plans, a number of 
them have plans which meet the essential health benefits. So I 
can try to get those numbers.
    Mr. Murphy. Well, let me put a face on that. A person named 
Paul wrote to me and says, I'm supposedly one of the families 
that this act was supposed to help, but it's in fact hurting 
more, would make it harder for my family to live. We will have 
less money for food and other essential items. I have a wife 
and four children to take care of. Another person wrote, I had 
a 2013 plan, which if you include the premiums and out-of-
pocket, total liability was $5,300. For 2014, the same program 
liability is $9,000. Single mom writes, I want to convey I'm 
one of the millions of people who's having their health 
insurance cancelled because it does not meet the standards of 
Obamacare. I liked my insurance. I especially liked the price, 
and now I'm being forced to sign up for something that will be 
way more expensive. As a single mom who is self-employed, I'm 
worried about how I'm going to pay my bills.
    I hope you have a mechanism to track who these people are, 
that she's not eligible for other subsidies, but the costs are 
really going to be driving her down.
    Secretary Sebelius. Well, sir, again, I would suggest that 
there is no requirement that any of those consumers sign up for 
a plan suggested by their company at a higher price. They have 
now options----
    Mr. Murphy. But if a plan changes----
    Secretary Sebelius [continuing]. Without health 
underwriting, without pre-existing conditions, with some 
guarantees around how much out-of-pocket costs that----
    Mr. Murphy. She's searching around, and she can't find a 
plan she can afford.
    Secretary Sebelius [continuing]. They never had before.
    Mr. Murphy. She can't find a plan she can afford.
    Mr. Upton. The gentleman's time is expired. The gentleman 
from North Carolina, Mr. Butterfield.
    Mr. Butterfield. Mr. Chairman, before my time begins, I 
have a parliamentary inquiry.
    Mr. Upton. Yes. Go ahead.
    Mr. Butterfield. Mr. Chairman, I'm always sensitive to 
committee decorum, and before I do it this morning, I want to 
ask unanimous consent that I be allowed to display the 
Democratic Twitter handle.
    Mr. Upton. Go right ahead.
    Mr. Butterfield. Hearing no objection. Thank you.
    Secretary Sebelius, thank you so very much for coming 
today. I would like to ask you about the document that my 
Republican colleagues have just released. This document is an 
authority to operate memorandum, to operate the federally-
facilitated marketplace for 6 months and implement a security 
mitigation plan. This document, as I understand it, describes 
security testing for HealthCare.gov. It says that security 
testing of the marketplace was ongoing since its inception and 
into September of this year. In fact, it says that, quote, 
throughout the three rounds of security control assessment 
testing, all of the security controls have been tested on 
different versions of the system.
    That's good news, but the bad news is that it goes on to 
say that because of system readiness, a complete security 
assessment of all the security controls in one complete version 
of the system were not tested.
    This document indicates that CMS postponed a final security 
assessment screening, but in its place, CMS did put in place a 
number of mitigation measures, and it concluded that these 
measures would mitigate any security risk.
    Question: Are you familiar with this document?
    Secretary Sebelius. Yes, sir.
    Mr. Butterfield. Is it correct that this document 
recommends implementing a dedicated security team to monitor, 
track, and ensure the mitigation plan activities are completed?
    Secretary Sebelius. Yes, it does.
    Mr. Butterfield. Now, is it correct that this document 
recommends monitoring and performing weekly testing on all 
border devices, including Internet-facing Web servers?
    Secretary Sebelius. More than recommended. It's underway.
    Mr. Butterfield. Is it correct that this document 
recommends conducting daily and weekly scans?
    Secretary Sebelius. Yes, sir.
    Mr. Butterfield. Does this document recommend conducting a 
full SCA test on the marketplace in a stable environment?
    Secretary Sebelius. Yes, sir.
    Mr. Butterfield. Is it correct that this document 
recommends migrating the marketplace to CMS's virtual data 
center environment in the first quarter of next year?
    Secretary Sebelius. Yes, it does.
    Mr. Butterfield. My understanding is that an independent 
security expert, the MITRE Corporation, is performing security 
testing on the code that powers the Web site on an ongoing 
basis. Is that correct?
    Secretary Sebelius. That is correct. And MITRE did an 
assessment of the system, gave us a preliminary report. They 
are in the process of posting their final report. That did not 
raise flags about going ahead, and the mitigation strategy was 
put in place to make sure that we had a temporary authority to 
operate in place while the mitigation was going on, and then a 
permanent authority to operate will be signed.
    Mr. Butterfield. Finally, do you have confidence in these 
and other measures you are taking to protect the security of 
Americans' personal information?
    Secretary Sebelius. I do, sir.
    Mr. Butterfield. Thank you. This is the third time you said 
it during the hearing, and we believe you. Thank you.
    What you're telling us is that these remedial actions and 
the ongoing security testing from MITRE are protecting the 
security of the Web site. That's a message that is important 
for the public to hear. My Republican colleagues do not want 
this Web site to work. I am convinced of that. They want to 
block the ACA at all costs and even shut down the government to 
stop the law.
    For the last 4 years, they have taken every glitch, every 
simple glitch and hiccup in the law and tried to exaggerate its 
significance, and that's happening today and it's so 
disappointing.
    Thank you, Mr. Chairman. I yield back.
    Mr. Upton. Dr. Burgess.
    Mr. Burgess. Mr. Chairman, I wonder if I might make a 
unanimous consent request also.
    Mr. Upton. Yes. Go ahead.
    Mr. Burgess. I would like to request unanimous consent that 
my opening statement, which we were not allowed to give could 
be made part of the record for this hearing.
    Mr. Upton. No. Without objection.
    Mr. Burgess. And further, I do have a number of questions. 
Many have come from constituents. I'd also like to be able to 
submit those as questions for the record.
    Mr. Upton. Without objection.
    [The prepared statement of Mr. Burgess follows:]

             Prepared statement of Hon. Michael C. Burgess

    The Affordable Care Act is quickly becoming the poster 
child for the failure of big government. It's a stunning train 
wreck that is coming down the tracks toward us.
    Since the law was passed in 2010 this Committee has 
repeatedly questioned the officials from the Department of 
Health and Human Services (HHS), the Center for Medicare and 
Medicaid Services (CMS), the Treasury Department, and the White 
House. I was told, time and time again, by all of these 
officials that the ACA would ``definitely'' be ready to go live 
on October 1, 2013.
    On February 16, 2011, the former director of the Center for 
Consumer Information and Insurance Oversight (CCIIO), Mr. Steve 
Larsen, assured me everything would work on Day 1:

    Mr. (Burgess.) You are betting on all this stuff working.
    Mr. (Larsen.) I think we are going to flip the switch and 
the lights are going to go on.

    On April 18, 2013, Kathleen Sebelius, Secretary of Health 
and Human Services, sat before the Energy and Commerce 
Committee and told me:

    Dr. (Burgess.) They are to go live online on October 1st. 
And I guess the question on everyone's mind this morning is, 
will you be ready?
    Secretary (Sebelius.) Yes, sir, and the exchanges----
    Dr. (Burgess.) I will take that as a yes.
    Secretary (Sebelius.) Open enrollment will start October 
1st. The exchanges will be up and running on January 1st.
    Dr. (Burgess.) Are you talking about work around plans?
    Secretary (Sebelius.) No, we are not. We are moving ahead. 
We have the federal hub on track and on time. We are moving 
ahead with the marketplaces that we will be individually 
responsible for and we're working very closely with our state 
partners on their plans and their time table for the state 
based marketplaces.
    Dr. (Burgess.) So the federal hub will be 
available?Secretary (Sebelius) Yes.

    The following week, on April 24, 2013, Gary Cohen, the 
current director of CCIIO, testified before theEnergy and 
Commerce Committee:

    Dr. (Burgess.) The Secretary was here last week and I asked 
her about contingency plans and she said there are no 
contingency plans. Everything will be ready. So which is it? 
Everything will be ready or you are planning for contingencies?
    Mr. (Cohen.) Everything will be ready but we are also 
planning for anything that, when we go into operation, if the 
situations come up that we need to address, we will be ready to 
address those situations and make sure that the experience for 
American consumers is as seamless and as good as it can be.

    On August 1, 2013, Marilyn Tavenner, the current CMS 
Administrator, testified before the Energy and Commerce 
Committee:

    Dr. (Burgess) When can Texans expect to go online and be 
able to get information about how expensive coverage will be in 
the exchange?
    (Ms. Tavenner.) So the information about what is available 
in the exchange will be available to them October 1.

    And just a little over one month ago, on September 19, 
2013, days before the Exchanges were scheduled to go live, Gary 
Cohen, CCIIO Director, testified before the Energy and Commerce 
Committee again:

    Dr. (Burgess) Will the enrollment process be ready October 
1 of this year?
    Mr. (Cohen.) Consumers will be able to go online, they will 
be able to get a determination of what tax subsidies they are 
eligible for, they will be able to look at the plans that are 
available where they live, they will be able to see the premium 
net of subsidy that they would have to pay, and they will be 
able to choose a plan and get enrolled in coverage beginning 
October 1.

    Yet, here we are, 30 days after October 1 and the American 
people are still waiting to see a fullyfunctional law. The 
failures of the healthcare.gov Web site are just the beginning 
of the dysfunction that is to come as the implementation of 
President's signature law moves forward into 2014. After 
spending hundreds of millions of dollars the American people 
deserve some concrete answers and not empty political 
posturing.
    In addition to the hearings this Committee held to question 
Administration officials, I had private meetings with Jay 
Angoff, former CCIIO director and later senior adviser to 
Sebelius; Nancy Deparle, former Director of WH Office of Health 
Reform; Henry Chao, Deputy Chief Information Officer; and Steve 
Larsen, former CCIIO director. It seems I was having the 
meetings the Secretary was supposed to be having.
    Despite the array of public and private meetings with 
officials from the range of agencies involved in implementing 
the President's health care law, I still do not have the 
answers to questions about the law's basic functionality. At 
this point, I'm not even sure who is in charge of this program 
because no one knows what is going on. Unless someone is 
willing to admit that there are problems, how can we ever hope 
to fix it?

                                #  #  #

    Mr. Burgess. And ask the Secretary for her attention to 
those so we could get answers, because they, after all, are 
important questions. OK. Thank you, Mr. Chairman.
    It just came to my attention that on CNN's Web site, that 
the site was hacked just last week. And I will be happy to make 
this available to you. I don't think the----
    Secretary Sebelius. The CNN Web site?
    Mr. Burgess. CNN ran a story that the HealthCare.gov Web 
site was hacked last week. And, again, I will get this to you, 
and would appreciate your response to that.
    Mr. Terry had asked a question about he wanted to get the 
information about the number of people who had signed up. You 
said you wouldn't provide that, because it wasn't accurate. 
Would you provide us with the number of people who have been 
able to enroll on the telephone? The President gave an 800 
number during his speech. Could we get a number of people who 
have enrolled on the telephone?
    Secretary Sebelius. No, sir. We do not have reliable 
enrollment data. We will have that to you by the middle of 
November, as we committed to. We are collecting State data, we 
are collecting telephone data, we are collecting paper data, we 
are collecting Web site data. We want it to be reliable----
    Mr. Burgess. OK.
    Secretary Sebelius [continuing]. And accountable, and 
that's what we will have.
    Mr. Burgess. Reclaiming my time. The telephone data doesn't 
seem that it would be that difficult to compile since the 
number is likely quite low. Now----
    Secretary Sebelius. The telephone goes through the system, 
sir.
    Dr. Burgess [continuing]. You have, or the President 
designated a, I call him a glitch czar, Jeffery Zients. And 
you're familiar it was his appointment to oversee----
    Secretary Sebelius. I asked him to serve in this capacity, 
yes, sir.
    Mr. Burgess. Many of us on the Subcommittee of Oversight 
Investigations in Energy and Commerce were not as comforted as 
you by that selection, because if you will recall, Mr. Zients' 
history with this subcommittee it not great. He was involved 
with Solyndra. We asked him to come and talk to us about 
Solyndra in 2011. He refused, requiring a subpoena to be issued 
by this subcommittee.
    Will you commit to making Mr. Zients available to our 
subcommittee for our questions?
    Secretary Sebelius. Congressman, you are welcome to ask Mr. 
Zients to come before the committee. He is volunteering his 
services to us for a period of time. He has been appointed by 
the president to start in January as the head of the National 
Economic Council. He was the deputy director at OMB for 
management and performance. I am thrilled that he is willing to 
take on this assignment and help us drive the management, but--
--
    Mr. Burgess. Again, his appearance here will be important.
    Now, a lot of people are asking if the President's words 
leading up to this law, if they matter. And the statement in 
The Washington Post today edited the President's statement to 
say, if you like your health care plan, you will be able to 
keep your health care plan if we deem it adequate. That seems 
like a more operational statement, and especially if you go 
back just a few years into the Federal Register, and I'm 
quoting here from the Federal Register from July 23rd of 2010, 
just a few months after the law was signed, the interim rule 
for dealing with the grandfathering written into the Federal 
record, because newly-purchased individual policies are not 
grandfathered, the Department expects that a large population 
of individual policies will not be grandfathered, covering up 
to and perhaps exceeding 10 million people.
    I hope the President was apprised of that before he made 
these statements, because clearly his statement wasn't 
operational.
    Secretary Sebelius. Again, that's an insurance company 
choice. And that was a snapshot----
    Mr. Burgess. But----
    Secretary Sebelius [continuing]. Of what the market looks 
like.
    Dr. Burgess [continuing]. Your----
    Secretary Sebelius. The President made it clear, and our 
policy was to put----
    Mr. Burgess. In----
    Secretary Sebelius [continuing]. A grandfather clause in 
both employer-based coverage and in----
    Mr. Burgess. Right. But in the----
    Secretary Sebelius [continuing]. Individual coverage.
    Mr. Burgess. [continuing]. Federal Register, those were the 
comments that were recorded. Now, I do have to----
    Secretary Sebelius. No. This isn't a government takeover of 
anything. These are private insurance plans----
    Mr. Burgess. I do have to ask you this.
    Secretary Sebelius [continuing]. Making private decisions.
    Mr. Burgess. I do have to ask you this: You serve at the 
pleasure of the President, we're all aware of that, but we have 
had many of your employees here in front of this committee, and 
you do have to ask yourself, are they just being purposely 
misleading, or are they really not that smart? So I'm going to 
ask you this morning, for the sake of the future of health care 
in this country, will you please ask for the resignation of 
Gary Cohen, because he's repeatedly come to this committee and 
misled us?
    Secretary Sebelius. I will not, sir.
    Mr. Upton. The gentleman's time has expired.
    Mr. Waxman. Mr. Chairman, a point of personal privilege. I 
just think the record ought to be clear about Jeffrey Zients. 
He was invited with less than a week's notice to come before 
this committee. He couldn't make it that day. He asked for some 
other day. He went to OMB and had nothing to do with the 
Solyndra contract, and he did come before us and talk about it, 
but his sole role was to represent OMB. And I don't think he 
ought to have any--there ought to be any disparagement of 
Jeffrey Zients. He's a very well-regarded public servant.
    Mr. Upton. The gentleman's statement will stand. Ms. 
Matsui.
    Ms. Matsui. Thank you, Mr. Chairman. Welcome, Madam 
Secretary. Now, we all agree the Web site problems must be 
resolved, as this country invented and developed the Internet 
and the concept of the Web sites, so there are high 
expectations. The fact that the hired private contractors could 
not build a ready Web site in nearly 3 years is inexcusable, 
and after its fix, I hope the administration will hold those at 
fault accountable, but we can't lose sight of the big picture 
that when this is all said and done, every American will have 
affordable quality health insurance and health care. This is 
the goal, I believe, of all Democrats and Republicans.
    The ACA's working in California, and it's working in my 
district in Sacramento, and I just want to tell you about a 
letter I got from a constituent:
    ``Dear Congresswoman Matsui, as a self-employed contract 
employee, I've had individually purchased health insurance for 
11 years now, insurance that has gone up every year, sometimes 
more than once; insurance that wouldn't let me add my daughter 
when my ex-husband stopped his insurance policy that covered 
them both; insurance that I have underused for fear they would 
drop me; insurance that has just dropped me anyway because they 
decided they will no longer offer individual plans. This could 
have happened to me at any time. I'm so grateful the Affordable 
Care Act provisions make it possible to get health insurance 
beginning in January for me and my daughter.
    ``As all this is happening, I have finished graduate school 
and started my own business. Slowly but surely, things are 
happening, and I expect to be hiring my first employees in the 
next 6 months. The provisions of the ACA are helping me in 
this, too. I can clearly see what it would cost me to provide 
health benefits for my future employees, understand these costs 
and build my business plan accordingly.'' And that is just one 
of the letters I received.
    Now, I've also heard from my colleagues on the other side 
of the aisle complain again and again about how health care 
reform is increasing health care costs, but the empirical 
evidence shows something quite different. The recent trends in 
Medicare spending growth are really quite remarkable. Medicare 
spending growth is at historically low levels, growing by less 
than one half of 1 percent in fiscal year 2012, following slow 
growth in 2010 and 2011. The same is true on the private side 
of health care. Personal consumption expenditures on health 
care, everything from health insurance, to drugs, to hospital 
care rose by just over 1 percent in the past year. This is the 
slowest increase in nearly 50 years.
    Madam Secretary, what does this data tell us about what has 
happened to health care costs since the ACA became law?
    Secretary Sebelius. Well, Congresswoman, you're absolutely 
right. In the last 3-\1/2\ years since the President signed the 
Affordable Care Act, we have seen a great slowdown in the 
extraordinary cost increases year in and year out for health 
care, in the Medicare plan, in the Medicaid plan, in private 
insurance, and in underlying healthcare costs, which affect 
every American. Some of that is to do with some of the features 
that are currently in place around different care delivery and 
different payment systems that we are helping to drive, given 
the tools that we have, with the Affordable Care Act: more 
quality outcomes, trying to prevent hospital readmissions, 
looking at hospital-acquired infections, medical homes that 
prevent people in the first place or help them stay healthy in 
their own homes and in their own places.
    Ms. Matsui. So it's true that the private insurance costs 
are growing at the slowest rate in decades also; is that true?
    Secretary Sebelius. That is true.
    Ms. Matsui. Am I also correct that ACA premiums are coming 
in even lower than predicted by experts like the CBO?
    Secretary Sebelius. Well, they're on average about 16 
percent lower than was estimated that those premiums would be. 
And that's the premium, not accounting for the number of 
uninsured or underinsured Americans who will then qualify for 
financial help. Since they don't have employer coverage, they 
get some help from the taxpayers paying for that coverage.
    Ms. Matsui. Thank you, Madam Secretary.
    Mr. Upton. Dr. Gingrey.
    Mr. Gingrey. Thank you, Mr. Chairman.
    Madam Secretary, when you spoke at the Democratic National 
Convention in Charlotte last September, one of the first 
statements you made about the Affordable Care Act was, quote, 
``But for us Democrats, Obamacare is a badge of honor, because 
no matter who you are, what stage of life you're in, this law 
is a good thing. First, if you already have insurance you like, 
you can keep it.'' And I end the quote.
    I'd call this a red hearing that misled voters, intentional 
or not. Now, perhaps had you known that millions would lose 
their coverage, families would face financial disaster, as one 
constituent recently told me, or that the exchange rollout 
would be plagued by a multitude--multiple delays we've seen, 
you would not consider it such a badge of honor.
    The fact is your words and those of the President as he 
campaigned last year that ``if you already have insurance you 
like, you can keep it'' seems to be directly refuted by the 
millions of cancellation notices already sent to Americans just 
in the past few weeks. Whether your statement was inaccurate, 
or, as Mr. Hoyer said yesterday, not precise enough, it does 
strike me that millions of individuals who, by listening to 
speeches like yours, voted believing one thing now find 
themselves without coverage and are now scrambling to find 
coverage in a marketplace that offers more expensive plans with 
fewer options.
    In response to my constituents' calls for help, I created a 
portal on my Web site--no patches or fixes needed--that allows 
those who have experienced problems to reach out and tell me 
about their personal experiences. In just the last few days, my 
office has received dozens of complaints regarding increases in 
their monthly premiums. I received one such notice from a 
mother in her early fifties, who just received a notice that 
not only will her insurance premium double, but she will also 
have to switch insurers to keep her doctors due to the effect 
of the Affordable Care Act.
    Can you imagine receiving notices like this? I can tell you 
that just in my district, the 11th of Georgia, many more are 
experiencing this situation. Madam Secretary, this is akin to 
telling seniors that in a few weeks their Medicare coverage 
will be dropped, or their premiums would double. Now, I know 
that neither you nor the administration would ever advocate for 
such a policy, yet here you are subjecting those currently in 
the individual market to such government intervention. And I 
would hope that you would agree with me in recognizing that 
these increases are a heavy hardship on my constituents, on all 
of our constituents, Republicans or Democrats.
    Now I'll get to my questions. You know the healthcare law 
included a hardship exemption from the individual mandate, yet 
the administration has failed to finalize the application form 
for the hardship exemption 3-\1/2\ years after we passed this 
law. As of today can an individual apply for a hardship 
exemption from the individual mandate on HealthCare.gov, yes or 
no?
    Secretary Sebelius. I don't know----
    Mr. Gingrey. I do. It's no.
    On October 15, Politico reported that if the online system 
for getting into Obamacare coverage is rickety, the system for 
getting out of the mandate doesn't even exist yet. HHS says it 
will take another month at least for the administration to 
finalize the forms for the hardship exemption from the 
individual mandate.
    Why has it taken 3-\1/2\ years to finalize a simple 
application form for an exemption from the individual mandate?
    Secretary Sebelius. Well, sir, as you know, the individual 
mandate is not in place until next year. We have made it very 
clear that if somebody is Medicaid eligible in a State that 
doesn't choose to expand Medicaid, they will be exempted from--
--
    Mr. Gingrey. My last question. An estimated 16 million 
people in the individual market have or will receive 
cancellation notices stating their health insurance coverage 
does not meet minimum coverage requirements of the Affordable 
Care Act. The bill specifically grants you, Madam Secretary, 
the power to determine the criteria for a hardship exemption. 
Will you provide all of these individuals a hardship exemption 
since the Affordable Care Act has taken away their plan? Will 
you do that?
    Secretary Sebelius. No, sir. And I think those numbers are 
far from accurate. Ninety-five percent of Americans who have 
health insurance will be in a continuous plan, Medicare, 
Medicaid, employer-based, VA, 95 percent. Five percent, who are 
in the individual market, a portion of those 5 percent, a 
portion of them, about 12 million people, a fraction of those 
12 million, will have a plan that doesn't meet the criteria and 
has not been grandfathered in. They are indeed receiving 
notices. Many of those individuals, half of them, will be 
eligible for financial help getting a new plan, and they have 
many more choices in the marketplace. So we will not have a 
blanket exemption for them.
    Mr. Gingrey. Sounds like a hardship to me, Madam Secretary.
    Mr. Upton. Gentleman's time has expired.
    Mrs. Christensen.
    Mrs. Christensen. Thank you, Mr. Chairman.
    And thank you, Madam Secretary, for being here. And thank 
you for all that you and your staff at HHS has done in 
implementing the Affordable Care Act to ensure that it would 
provide the many benefits that children, to women, to Medicare 
beneficiaries, and to ensure security to those who already have 
insurance as well as lower costs.
    Of course, the biggest complaint has been about the 
application and the enrollment Web site, but we have heard over 
and over from you that those are being addressed. But you would 
recall, and I know my colleagues would recall, that Congressman 
Rush and I have always been concerned about those who do not 
have Internet access, those who are uncomfortable using the 
Internet and would not use it. So I just wanted to just remind 
everyone that there are other avenues for enrolling, either by 
telephone or by paper, either alone or with the help of a 
certified, you know, application assistant.
    But my question goes to one of the rumors that's been 
circulating. There are many rumors about how the Affordable 
Care Act has affected part-time workers. And some of my 
colleagues on the other side claim that the companies are 
moving workers to part-time jobs because of the healthcare 
reform law, and that low-wage workers are being detrimentally 
affected. And I understand why these claims are being made, as 
just another part of the ongoing effort to undermine the law. 
Would you take a few minutes to just set the record straight on 
the ``part-time'' issue?
    Secretary Sebelius. Certainly. Ninety-five percent of 
businesses in this country are small businesses, under 50 full-
time employees, and there is no responsibility that any of 
those employers have to provide health coverage for their 
employees. On the other hand, there are now tax credits 
available for some of the smaller employers who want to offer 
coverage to actually come into the marketplace.
    For the other businesses, the businesses hiring 50 or more, 
there is a standard that says an employee is considered full 
time if he or she works 30 hours a week, and that really came 
from a market snapshot with help from the Small Business 
Administration of where employee benefits were in the private 
market based on hours of work, what was a part-time or a full-
time employee.
    What we know about the economic data is the high point of 
part-time workers was in 2008 and 2009, at the height of the 
last recession. It has been decreasing each and every year. 
There is no data to support the fact that there is an uptick 
based on the impending Affordable Care Act. I am sure that 
there may be some individual employers making some business 
decisions about how many workers they want full time and how 
many part time, but I can tell you there is no economic data or 
employment data that supports the notion that this is an effect 
of the law.
    Mrs. Christensen. So, in fact, it's my understanding that 
part-time workers are at the lowest percentage of workers in 
many, many years right now. And----
    Secretary Sebelius. Well, and for the first time, as you 
know, Congresswoman, part-time workers will have options for 
affordable health coverage. They've never had that before. 
They've never had options in the marketplace. They've never had 
some help purchasing coverage for themselves and their 
families. Their full-time colleagues have, but they have not. 
So they will have options.
    Mrs. Christensen. And just to be clear, I had another 
really long question, but the last part of it, it would be fair 
to say that at every point along the way, you expected this Web 
site to work based on everything that you had been told by the 
contractors up until that point.
    Secretary Sebelius. Well, I expected it to work, and I 
desperately want to get it working.
    Mrs. Christensen. More than anyone else, I am sure.
    Secretary Sebelius. I can't tell you how frustrated I am, 
and we are committed to fixing it. And the only thing that I 
think builds back the confidence of the public is fixing it.
    Mrs. Christensen. Thank you, Mr. Chairman.
    Mr. Upton. Gentlelady's time has expired.
    Mr. Scalise.
    Mr. Scalise. Thank you, Mr. Chairman, for holding the 
hearing.
    And thank you, Secretary Sebelius, for being with us.
    Last week when the contractors that built the system were 
here, I had asked them all under oath if they had actually 
delivered the system they were contracted to build, and all 
four of them answered ``yes.'' So I want to ask you, did the 
contractors deliver the system that you contracted them to 
build?
    Secretary Sebelius. I don't think I can accurately answer 
that question. What we know is we have a system that doesn't 
function properly.
    Mr. Scalise. We definitely know that.
    Secretary Sebelius. As we fix things, we will know more 
about what is broken along the way, and I'll be able to----
    Mr. Scalise. So would someone in your office--somebody in 
your office oversaw this implementation and received the 
product.
    Secretary Sebelius. That's true.
    Mr. Scalise. And they either said, this is the product we 
contracted and paid hundreds of millions of dollars to build, 
or it wasn't. Does somebody in your office have the ability 
to----
    Secretary Sebelius. Well, I think that we can say that the 
products tested, individually verified, individually function--
--
    Mr. Scalise. But clearly it was an integrated system.
    Secretary Sebelius. They don't work well together. And----
    Mr. Scalise. Well, but I used to write programs for a 
living. I developed software products for a living. If you're 
developing an integrated system, it's irrelevant if one 
isolated component works by itself, but when you plug it in 
together it doesn't work, that's a system that doesn't work.
    One of the questions I had and others had, somebody in your 
agency made a decision weeks, literally weeks, before the 
deployment to change the system instead of going from a browser 
ability where somebody, just like on Kayak or just like on 
Amazon.com, could go shop for products, look at prices before 
they purchased, which is how consumers are used to doing this. 
You all made the decision to change it around and gather all 
their information first before you could let them see prices. 
Was that you who made that decision?
    Secretary Sebelius. No, sir.
    Mr. Scalise. Was that Ms. Tavenner?
    Secretary Sebelius. It was Ms. Tavenner and a team who 
looked at not imposing additional risks on the system.
    Mr. Scalise. Did that team make the decision because they 
knew once people actually saw the prices--and we're getting 
reports from all of our constituents of dramatically higher 
prices than what they were expecting. Did you make the decision 
because you knew that when they saw the prices, they might not 
want to buy the products, so you wanted to gather their 
information first?
    Secretary Sebelius. Sir, first, I did not make the 
decision. I was informed about the decision. We did it in----
    Mr. Scalise. Did you agree with the decision?
    Secretary Sebelius [continuing]. September rolling off a 
number of features. And clearly they can see the products. 
Note, there is no requirement to buy anything.
    Mr. Scalise. Look, I spent over 2 hours trying to get into 
the system. I never once got to a point where I could see a 
price. I did get kicked out many times and got some of those 
blanks screens other people got.
    I do want to share some stories with you from some of my 
constituents, because we started a page on our Facebook and on 
Twitter. We are collecting what's called Share with Scalise. 
People are sending us stories. And we're getting lots of 
stories from my constituents. I want to read you a few of them.
    Randall from Mandeville said, ``My healthcare premium went 
up 30 percent. That's over $350 a month increase.''
    We had Michelle from Slidell: ``Our insurance premiums are 
going up $400 a month, and our deductible has increased.''
    And then you've for the Sean from Covington, who said, ``My 
current plan through United Healthcare is no longer being 
offered in 2014 due to Obamacare. In fact, I received a letter 
stating that the new healthcare law was indeed the reason for 
the removal of my current healthcare plan.''
    Madam Secretary, what would you tell Sean, who liked his 
plan and now has lost it? And he was promised by you and the 
President he'd be able to keep that plan. What would you tell 
Sean now that he's lost his plan?
    Secretary Sebelius. I would tell Sean to shop in the 
marketplace and out of the marketplace, and he will find----
    Mr. Scalise. Do you really think that's an acceptable 
answer----
    Secretary Sebelius [continuing]. And he will find 
competitive prices.
    Mr. Scalise [continuing]. To Sean?
    Secretary Sebelius. Again, if United chose not to keep 
Sean's plan in effect for Sean----
    Mr. Scalise. Because of the law.
    Secretary Sebelius. Sir, the law said if you keep Sean's 
plan in place, if he liked his plan, if you only----
    Mr. Scalise. Sean likes his plan----
    Secretary Sebelius [continuing]. Applied trendlines to 
Sean, then the plan is still there.
    Mr. Scalise. You and I may disagree over who you work for. 
I work for Sean. You work for Sean, Madam Secretary. Sean lost 
his plan that he liked. And there are thousands and millions of 
Seans throughout this country that lost the plan they like 
because some bureaucrat in Washington said, we think your 
plan's not good enough; even though you like it, even though 
you were promised you could keep it, you're now not able to 
keep that plan. I think you deserve to give Sean a better 
answer than you just have to go shop for something else even 
though you lost your plan.
    Mr. Upton. Gentleman's time has expired.
    Mr. Scalise. I yield back the balance of my time.
    Mr. Upton. Gentleman's time has expired.
    Mr. McNerney.
    Mr. McNerney. Thank you, Mr. Chairman.
    Thank you, Madam Secretary, for coming today.
    I'm going to follow up on Mr. Doyle's line of questioning. 
One concern I have with the fallout from the Web site is that 
many users who tried to sign up and were discouraged because of 
the problems will now be too discouraged to come back once the 
site is fixed. So what do you plan to do to get those folks to 
come back?
    Secretary Sebelius. Well, sir, we intend to invite them 
back formally, by email, by message, but we don't want to do 
that until we're confident that they will have a different 
experience. So fixing the site is step one, and then inviting 
people back to the site to make it clear that when our 
timetable is fulfilled, they have 4 months to shop for 
affordable health coverage on a fully functioning site.
    We know we're going to have to spend special time and 
attention on young and healthy Americans, who don't start out 
thinking they need health insurance, aren't aware of the law, 
certainly don't want to use a failed or flawed site. So we're 
going to have to spend some particular attention on them.
    Mr. McNerney. Thank you.
    Have the software specifications for the Web site and its 
related software elements, including the test specifications--
has that changed since the initial rollout?
    Secretary Sebelius. I know that there certainly are some 
changes, because--since October 1st? I'm sorry.
    Mr. McNerney. Yes. Since the rollout, the specifications.
    Secretary Sebelius. The specifications haven't changed. We 
are certainly fixing--as I say, speed and reliance is one of 
the issues we're taking a look at. That's the performance side. 
But there also are some functionality sides that things do not 
work as they can, including the enrollment passed on to 
insurers. So we are fixing functionality. And I don't think 
that's a change in the specs; I think it is actually making the 
system work the way it should.
    Mr. McNerney. Well, are you--or is the Department doing 
prioritization on the problems?
    Secretary Sebelius. Yes.
    Mr. McNerney. Could you describe that a little bit?
    Secretary Sebelius. Yes. As of last week, when Jeff Zients 
joined us for the short-term project, we asked him to lead a 
sort of management team. We have pulled in all of our 
contractors as well as additional talent that they may have 
available. We have talked to tech folks in and out of the 
private sector and insurance, some of their tech experts, to 
get all eyes and ears; made a full assessment; developed a plan 
for fixes along the way; have a punch list for going after 
those fixes; and we are doing a daily tech briefing and blog to 
tell people what we have found, what we have fixed, what is 
coming next, what the functionality is. And we intend to do 
that until it's fully functional.
    Mr. McNerney. Thank you, Madam Secretary.
    Looking past the initial problems with the ACA rollout, do 
you think that the Affordable Care Act will be successful in 
bending the healthcare cost curve and reducing the fraction of 
our national economy that goes for health care?
    Secretary Sebelius. Well, I think that we have already had 
some success. I think the goal is to continue to achieve that. 
A fully insured population arguably with preventive care, with 
an opportunity to see a primary care doctor and not go through 
the emergency room will in and of itself reduce costs. Having 
people identified earlier who may have serious problems in 
managing those problems will reduce health costs. But I think 
the delivery system also needs some considerable help in paying 
for not number of procedures, number of tests, number of 
prescriptions, but paying for health outcomes.
    Mr. McNerney. Thank you, Mr. Chairman.
    Mr. Upton. Mr. Latta.
    Mr. Latta. Well, thank you very much, Mr. Chairman.
    And, Madam Secretary, thank you so much for being with us 
today. Appreciate your testimony so far today.
    What I'd like to do is I'll get these to you because 
there's so many we've received. These are questions that we've 
received from our constituents back home specifically about 
what's going on with the Web site and for them. And so what 
I'll do, I'd like to get those to you. But there's a lot of 
questions here, and a lot of thought's gone into a lot of these 
questions.
    But if I could start with last week's testimony when four 
of the contractors were here. And in one of the questions that 
I had posed to Ms. Campbell from CGI, in her testimony she had 
stated that they delivered the Medicare.gov and also the 
FederalReporting.gov. And I had asked at that time were those 
sites more or less complicated than the site we're talking 
about here today. And she said, of course, the site today was 
more complicated. And in the questioning and from her 
testimony--and we've been hearing about this end-to-end testing 
that wasn't happening, that we had individuals out there saying 
that about 2 weeks had been done. But I'd asked her about was 
there a sufficient enough time when they did Medicare.gov. And 
the response that she gave me back was on Medicare.gov, which 
was a less complicated site, and she stated that ``we had 
sufficient time to test the system before it went live.'' And I 
asked her in a follow-up then, ``What was that sufficient 
time?'' And she said, ``We had a number of months before the 
system went live at that time.''
    And I just want to make sure, because, again, sometimes 
things don't get reported accurately, but--in the U.S. News 
there was a report on October the 18th of this year, and 
there's some questions going back and forth. I just want to 
make sure that you were quoted properly. Said, ``'After 2 weeks 
of review,' the HHS Secretary concluded, 'we didn't have enough 
testing specifically for high volumes for a very complicated 
project. The online insurance marketplace needed 5 years of 
construction a year of testing,' she said. 'We had 2 years and 
almost no testing.''' Is that correct?
    Secretary Sebelius. I don't know the quote. I never 
suggested that we needed 5 years.
    Mr. Latta. OK. That's just----
    Secretary Sebelius. I don't know what that's from or what 
that----
    Mr. Latta. That's one of the things we're going to check.
    Secretary Sebelius. We clearly did not ever have 5 years. 
The law was signed in March of 2010.
    Mr. Latta. OK. And then last week when you were down in 
Texas, you were being asked by a reporter about the system and 
the launch. And one of the parts of the question was that at 
what point did you realize the system wasn't going to be 
working the way that you envisioned before the launch, and why 
didn't we stop it before the launch? And, again, this is what 
was reported: ``We knew that if we had another 6 months, we'd 
probably test further, but I don't think anyone fully realized 
both the volume caused such problems, but volume's also exposed 
some of the problems we had.''
    Now, going back, though, to Ms. Campbell's statement that 
they tested more extensively on a system that was not as 
complicated, but HHS, CMS decided to go forward with only a 
very short period of testing. Do you think that was acceptable?
    Secretary Sebelius. Well, clearly, looking back, it would 
have been ideal to do it differently. We had a product that, 
frankly, people have been waiting decades to have access to 
affordable health care. Medicare existed well before the Web 
site. Medicare is a program that started 50 years ago. The Web 
site was an additional feature for consumer ease and comfort. 
And so they were not launching Medicare, they were not 
delivering health benefits to seniors, they were putting 
together an additional way to enroll in Medicare.
    I would suggest, sir, that we had deadlines in the law, 
that people had benefits starting January 1st. We wanted an 
extensive open enrollment period so that a lot of people who 
were not familiar with insurance, didn't know how to choose a 
doctor or choose a plan, had never been in this marketplace, or 
people who needed to understand fully what the law offered had 
ample time to do that.
    So the date that I was, again, required to select for open 
enrollment, that's, again, part of the statute, how long would 
open enrollment be. We picked that date. All the contractors 
that began early in this process in the fall of 2010, when we 
issued--I'm sorry, 2011, when we issued the initial contracts 
to CGI and QSSI, knew the October 1st date. That was not 
changed. It wasn't added to.
    As we got closer to the system, one of the reasons, again, 
that we pared down what needed to launch on October 1st was an 
attempt to minimize the risks to the system to get people to 
their ability to see clearly what they were entitled to, what 
the plans were, and, if they chose to, to enroll. Clearly the 
testing should have been longer, should have been more 
sufficient.
    Mr. Upton. Gentleman's time has expired.
    Mr. Braley.
    Mr. Braley. Thank you, Mr. Chairman.
    Madam Secretary, people who are watching this hearing might 
be under the assumption that there's some kind of political 
debate going on over the Affordable Care Act. I think people in 
Iowa don't care anything about who's winning the political 
debate. They want these problems fixed, and they want them 
fixed now. And I think that's the responsibility of everyone in 
this room to make sure that that happens.
    I tried to go into the marketplace on October 7, and I 
encountered problems immediately dealing with the security code 
questions which required you to select dates. One of them was 
type a significant date in your life. Today is my birthday, so 
I put that in. I tried three different ways of entering that 
data and got a message each time: ``Important, this is not a 
valid answer.'' Same thing for the third date entry. And a lot 
of times when you're registering online for anything, and you 
have to put a date in, there will be a little prompt there that 
tells you what the format is you're required to enter.
    Do you know, have we solved this problem in the security 
code area?
    Secretary Sebelius. Yes, sir. One of the initial issues was 
just getting people into the site. And the ID proofing, which 
is a two-step process, one is that you give some preliminary 
information and you set up a password, but the second, to 
ensure that your personal data can't be hacked, can't be 
interfered with, is the second step where some personalized 
questions, which only can be verified by you, are indeed part 
of that.
    Again, that was an initial hold-up in the system. We 
focused a lot of attention on that in the first several days. 
It was fixed, only to then discover that there were system 
problems throughout the application. And that piece has been 
fixed, but I would suggest it also was a function of trying to 
make sure we had the highest security standards, that we were 
not cavalier about someone's personal information being able to 
be addressed and attached. And it was a functionality that 
didn't perform properly, but does now.
    Mr. Braley. One of the things that keeps coming up in this 
hearing, because you are from Kansas, is references to The 
Wizard of Oz. And people went to see the wizard because of the 
wonderful things that he did. And the Affordable Care Act is 
doing a lot of great things in Iowa. The Des Moines Register 
wrote that ``Iowans buying health insurance on the government's 
new online marketplace will face some of the lowest premiums in 
the country. It's increasing competition in our State. Iowa 
consumers are able to choose from 40 health plans in the 
marketplace.''
    You've mentioned the growth of healthcare spending is at 
the slowest rate in 50 years. Fifty thousand Iowa seniors have 
received prescription drug rebates. Bans on preexisting 
conditions are allowing people to get coverage and switch 
carriers. And now insurance premium increases are subject to 
review and can be rejected by the people reviewing those plans.
    But all of these good things don't mean anything unless we 
solve these problems. And what I need to know is how confident 
are you that the problems will be fixed by December 1st?
    Secretary Sebelius. Well, again, Congressman, I have 
committed to that date because that is the assessment of both 
inside and outside experts have analyzed, and I think they 
kicked all the tires and looked at all the system. I know that 
there's no confidence in that date until we deliver on the 
date. I am well aware of that, and that's on me.
    Mr. Braley. Since Americans were supposed to have 6 months 
to sign up, would you support ensuring they still have 6 months 
by extending the open enrollment period for 2 more months?
    Secretary Sebelius. At this point, Congressman, they will 
have a--fully 4 months of fully functional all ways to sign up. 
And again, there are alternate ways and the Web site right now 
that people are getting through.
    The open enrollment period is extraordinarily long. It's 
about six times as long as a typical generous open enrollment 
period. And it's important for the insurance partners to know 
who is in their pool so, again, they can stay in the market 
next year and know who they are insuring. So we think that the 
timetable will allow people 4 months' time to fully use the Web 
site. They can use it right now, they can use the call center, 
they can go to navigators, they can enroll.
    Mr. Upton. Gentleman's time has expired.
    Mr. Harper.
    Mr. Harper. Thank you, Mr. Chairman.
    Thank you, Madam Secretary, for being here today. I'm sure 
there are other things you'd rather be doing, but we welcome 
the opportunity to have this conversation.
    I'm going to ask the clerk to bring you a document for you 
to look at so I can ask you a couple of questions.
    If you can go to page 8 on that, I have highlighted an item 
there. But this is a copy of a CGI slideshow from October 11 
discussing technical issues that must be addressed within the 
Web site. And on page 8 of what I've handed you, CGI 
recommended that CGI and CMS have a review board to agree on 
which issues can technically be solved and which should 
politically be solved. Was such a review board convened?
    Secretary Sebelius. Sir, I cannot tell you. I've never seen 
this document, and I'm not aware of this recommendation.
    Mr. Harper. But CGI is responsible for the Web site, 
correct? Or for the operation?
    Secretary Sebelius. CGI is responsible for the application.
    Mr. Harper. For the application of this.
    Secretary Sebelius. Yes.
    Mr. Harper. Does it surprise you that in a slideshow that 
they gave in October 11th, they acknowledge political reasons 
for----
    Secretary Sebelius. Sir, again, I've never seen this 
document. I have no idea what that means. Did you ask CGI when 
they came last week?
    Mr. Harper. Can you find out for us if such a review board 
was done and if any decisions were made on political reasons or 
any other reasons and find that out for us?
    Secretary Sebelius. Sir, I--that question needs to go to 
CGI, but I can ask them to report to you.
    Mr. Harper. If you will do that.
    Secretary Sebelius. This is their document, if I 
understand. This is not our document.
    Mr. Harper. Would you turn to page 9 of that document, 
please? And it states ``Challenges'' on page 9 in this 
presentation by CGI. And it says, under ``Challenges,'' 
``Unable to determine at this time whether low enrollment 
counts are attributable to system issues or due to users 
choosing not to select or enroll in a plan.''
    So those are two completely different issues, obviously. If 
it is a system issue, that's something you have confidence at 
some point will be resolved, correct?
    Secretary Sebelius. Yes, sir.
    Mr. Harper. And if it's a user selection issue, that's an 
entirely different story; is it not?
    Secretary Sebelius. Yes, sir.
    Mr. Harper. OK. Now, when you used the phrase earlier about 
a punch list, that's like having somebody move into a house. 
Someone's buying a new house, and they go through, and they've 
been told this house is going to be ready for you to move in on 
October 1st. They load up the van, they come in. And they get 
in, and it's not finished. Part of the plumbing's not right, 
the wiring's wrong, and they go in.
    This creates the situation where, health care shouldn't be 
a zero-sum game. I mean, we want to be fair to everyone. We 
want to help people who are vulnerable, but at the same time we 
shouldn't have to hurt folks. We've got people in my district, 
in my State, who are getting notices of cancellation. They are 
being told of higher premiums that they're having. And these 
are great concerns that we have. And how do we work through 
that?
    And I want to say I appreciate you accepting responsibility 
for these initial rollout failures that we've had, but who is 
ultimately responsible? It is the President, correct?
    Secretary Sebelius. For the Web site? I would say that we 
are.
    Mr. Harper. I would say that the President is ultimately 
responsible for the rollout, ultimately.
    Secretary Sebelius. No, sir. No, sir. We are responsible 
for the rollout.
    Mr. Harper. But who do you answer to?
    Secretary Sebelius. I answer to the President.
    Mr. Harper. So is the President not ultimately responsible, 
like a company CEO would be?
    Secretary Sebelius. Sir, he's the President of the United 
States. I have given him regular reports. And I am responsible 
for the implementation of the Affordable Care Act. That's what 
he asked me to do, and that's what I'll continue to do.
    Mr. Harper. So you're saying that the President is not 
responsible for HHS?
    Secretary Sebelius. Sir, I didn't say that.
    Mr. Harper. OK. So the President ultimately is responsible. 
While I think it's great you're a team player and you're taking 
responsibility, it is the President's ultimate responsibility, 
correct?
    Secretary Sebelius. You clearly--whatever. Yes. He is the 
President. He is responsible for government programs.
    Mr. Harper. My time is expired.
    Mr. Upton. Gentleman's time has expired.
    Mr. Lujan.
    Mr. Lujan. Mr. Chairman, thank you very much. Before I 
begin, I'd like to ask unanimous consent to submit into the 
record some articles from New Mexico publications, the 
Albuquerque Journal, and Albuquerque Business Journal, the 
first entitled ``Small Business Owner: Health Exchange Will 
Save Me $1,000 a Month.''
    Mr. Upton. Without objection.
    [The information appears at the conclusion of the hearing.]
    Mr. Lujan. Thank you, Mr. Speaker. And I see my time did 
begin there, so I'll try to get through this, Mr. Chairman.
    Madam Secretary, I was intrigued by a line of questioning 
by Congressman Green, asking questions about the individual 
marketplace. How volatile was the individual marketplace before 
the Affordable Care Act became law?
    Secretary Sebelius. I would say it wasn't a marketplace at 
all. It was unprotected, unregulated, and people were really on 
their own.
    Mr. Lujan. Madam Secretary, the Kaiser Family Foundation 
reports that over 50 percent of individuals that have coverage 
in the individual market churn out of coverage every year. They 
either lose coverage, they are priced out or drop it. Is that 
consistent with what you're aware of?
    Secretary Sebelius. That's an accurate snapshot. About a 
third of the people are in for about 6 months, and over half 
are in for a year or less.
    Mr. Lujan. So individuals that were in the individual 
marketplace before the passage of the Affordable Care Act did 
not have the same protections as those that were in group 
coverage.
    Secretary Sebelius. That's true.
    Mr. Lujan. And would those individuals in the individual 
marketplace sometimes have higher copays?
    Secretary Sebelius. Higher copays, unlimited out-of-pocket 
costs for often coverage that was medically underwritten or 
excluded whatever medical condition they had in the first 
place.
    Mr. Lujan. So these were typically 1-year contracts. If 
they use the plan because they got sick or in a car accident or 
a victim of domestic violence, sometimes they'd be thrown off 
their plans, or their rates would go up.
    Secretary Sebelius. Yes.
    Mr. Lujan. I think that's important to note, Madam 
Secretary.
    And I'm intrigued as well that my understanding is last 
month HHS conducted an analysis that found that nearly 6 out of 
10 uninsured Americans getting coverage through the marketplace 
will pay less than $100 per month; is that correct?
    Secretary Sebelius. They will have a plan available for 
less than $100 if that's their choice, yes.
    Mr. Lujan. And that number would be even higher, would be 
better, if more States chose the option of using Federal funds 
to expand Medicaid to cover their low-income population?
    Secretary Sebelius. Oh, very definitely. That's just a 
marketplace snapshot. Those are people who will be in the 
marketplace.
    Mr. Lujan. Madam Secretary, I don't think that I've heard 
anyone from the other side of the aisle today, my Republican 
colleagues, ask you how can Congress work with you and support 
you in fixing this Web site and fixing this problem. I hope 
that we all agree we want this Web site fixed. I would yield to 
anyone that would disagree.
    Seeing no one accepting that, I'm glad to hear that we 
agree with this.
    Now, Madam Secretary, what can Congress do to work with you 
to fix this Web site?
    Secretary Sebelius. Well, I'm not sure that there is hands-
on work that you can do, maybe we have some technical 
expertise, but I would say getting accurate information to 
constituents is helpful; letting people know that they can 
check out the facts and the law; that they may be entitled to 
some financial support; that cancellation of policies means 
that the policy that they had may not exist, but they have a 
lot of choices of new policies and a law that now says they 
must be insured in a new policy, that they don't have to be 
insured by their company at a higher price.
    Mr. Lujan. I appreciate that, Madam Secretary.
    Going back to the individual marketplace, Madam Secretary, 
did this Congress in previous years before the Affordable Care 
Act make it illegal for health insurance companies to raise 
rates on someone after they submitted a claim for going to the 
hospital or becoming sick or getting rid of preexisting 
conditions?
    Secretary Sebelius. No, sir.
    Mr. Lujan. Madam Secretary, one last note here. It seems 
that we've received some horrible news here that there are bad 
actors already taking place of fraudulent Web sites that 
imitate the healthcare exchange or misleading seniors into 
disclosing their personal information. I've signed onto a 
letter to you led by my colleague, Representative Raul Ruiz out 
of California, to request that you prioritize fraud-prevention 
efforts. What's the administration done to prevent these 
fraudulent acts and protect personal information?
    Secretary Sebelius. I can tell you, Congressman, that the 
President felt very strongly that that needed to be part of our 
outreach effort, which is why the Attorney General and I 
convened representatives of State attorneys general, insurance 
commissioners, the U.S. attorneys, and the Justice Department 
and the Federal Trade Commission, which has jurisdiction, to 
make sure that we first got out ahead of some of this 
developing consumer outreach.
    No one should ever give personal health information, 
because personal health information is not needed for these 
policies any longer. That's a red flag. We want to make sure 
that people turn over potential fraudulent acts. We have put 
training in place for navigators. We have our law enforcement 
doing----
    Mr. Upton. Gentleman's time has expired.
    I would just note that, with the indulgence of the 
Secretary, we're hoping that we can have all Members ask some 
questions, but we also know that with 4 minutes, we're going to 
have a little trouble. So I'm going to ask unanimous consent 
that we try limit our questions and answers to no more than 2 
minutes. And I've talked to Mr. Waxman. Is that OK? Because 
otherwise there will be a lot of folks who will not be able to 
ask a question at all.
    Secretary Sebelius. Mr. Chairman, I would commit to if the 
questions get submitted, we would be happy to provide timely 
answers also to make sure----
    Mr. Upton. Can I do that? So with that, we'll try 2 
minutes.
    Mr. Lance.
    Mr. Lance. I guess I won the lottery on the 2 minutes. 
Madam Secretary.
    Mr. Upton. Time has expired.
    Mr. Lance. Twenty seconds, Mr. Chairman.
    On the Web site, Madam Secretary, the contractors testified 
last week that they needed more than 2 weeks for end-to-end 
testing. Why, in your opinion, was there not more than 2 weeks?
    Secretary Sebelius. Again, we had products--the insurance 
policies themselves by companies were loaded into the system. 
So wecould test up until then, but it wasn't until September, 
mid-September, that that was done. And, again, the contractors 
said, we would have loved more testing time, but we think we're 
ready to go ahead.
    Mr. Lance. I believe that will ultimately be a dispute 
between CMS and HHS and the contractors. And if there's 
anything we can do regarding that, because obviously that 
didn't work. And I had thought, given this signature issue with 
the President, that the Web site would be ready.
    Number two, in my judgment, the President's statements were 
overstatements. The four Pinocchios is an indication of that. 
There's a report in the New Jersey newspapers this morning that 
800,000 people in New Jersey who purchased their policies in 
individual or small-employer markets will be affected by this.
    Mr. Walden in a previous question mentioned the fact that 
in an individual market you would be able to keep your policy 
grandfathered. Yet regulations issued by HHS say that 
grandfathered status would not be continued for so much as a $5 
change in a copay. Is that accurate, and do you believe that 
that is a significant change?
    Secretary Sebelius. Sir, we gave, I think, in the 
grandfather regulations a guide for how pricing could change, 
medical inflation, and I think it was in most cases a plus 15 
percent. There were some individual consumer outfacing issues 
that were more rigid than that. But I would say that in terms 
of having companies being able to collect a profit margin, that 
was certainly built into the grandfather status.
    Mr. Lance. I think that's too little a change, 
respectfully.
    Mr. Upton. Gentleman's time has expired.
    Mr. Tonko.
    Mr. Tonko. Thank you, Mr. Chair.
    And welcome, Honorable Secretary. Thank you for fielding 
our questions and for responding when you were extended the 
courtesy to offer a response.
    As a strong supporter of the Affordable Care Act, I'm 
frustrated, and I think it's fair to say that the American 
people are frustrated as well. And I heard you here many times 
this morning say you're frustrated.
    I think by and large people want this law to work. When I 
talk to folks back home in the capital region of New York that 
I represent, even people who opposed the law initially aren't 
rooting for the failure of the Affordable Care Act. Instead, 
they want Congress to come together to fix these problems so 
that we can move on to real issues that matter, like creating 
jobs and growing the economy.
    My home State of New York, which also experienced Web site 
problems at the outset, has now completed enrollment 
determinations on over 150,000 New Yorkers, with more than 
31,000 having already signed up for quality, low-cost health 
insurance. Given that many States have had success in 
overcoming these initial Web site issues, has HHS looked at 
what these State Web sites are doing as it searches for 
solutions to the fix HealthCare.gov?
    Secretary Sebelius. Absolutely. And we shared a lot of the 
information going in. I think that the hub feature that we have 
in our Web site that all States are using, including the State 
of New York, is fully functional, and that's good news for New 
York and California and others who are running their own State 
Web sites. But we are learning from them, we've shared 
information with them, and we are eager for all the help and 
assistance moving forward.
    Mr. Tonko. Thank you.
    Similarly, many States made the illogical choice of 
rejecting Medicaid expansion contained in the ACA that would 
help some of their poorest citizens get access to the 
healthcare situation. This is despite the fact that Medicaid 
expansion is almost entirely financed by Federal dollars.
    Can you comment broadly on HHS' plan in the future to 
encourage more States to run their own marketplaces and expand 
Medicaid so that the law can function as designed?
    Secretary Sebelius. Well, absolutely. Most recently, last 
week, the State of Ohio did move into the Medicaid market. And 
we now have 30 Governors. I think 27 States have fully 
completed the process. Another three are in the process, 
Republicans and Democrats, some of whom sued us about the 
constitutionality of the act, who are now deciding that for the 
citizens of their State, they want to be part of the expanded 
Medicaid. And we will continue to have those conversations. 
It's not just about the marketplace, it's also about Medicaid.
    Mr. Tonko. Thank you very much.
    Mr. Upton. Gentleman's time has expired.
    Dr. Cassidy.
    Mr. Cassidy. You said that an individual policy is only 
cancelled if it changes significantly. But, to be clear, after 
May 2010, if coinsurance went up by any amount, even by a 
dollar, according to your regulations, that would not qualify 
as a grandfathered clause. Just to have that out there for the 
record. I gather even by a dollar.
    That said, I get a letter from someone in my district, 
Adrian. She says that, oh, she lost her coverage. She lost her 
coverage because spousal coverage is gone. She's gone on the 
exchange, she doesn't qualify for a subsidy, but that her 
premium and out-of-pocket costs, under any plan, is $10,000 a 
year. She feels--she writes this--she feels betrayed by her 
government. Now, she has to sit there asking herself, is this 
fair? If you were she, do you think that this would be fair?
    Secretary Sebelius. Dr. Cassidy, I want to start by the 
amount that you gave is not accurate. I was told it's $5, not a 
dollar.
    Mr. Cassidy. That's for the copay, not for the coinsurance. 
For the coinsurance, it's any amount. But I have limited time.
    Do you think that if you were she, if you were Adrian, do 
you think this is fair? Loses her spousal coverage, now it's 
10K, no subsidies?
    Secretary Sebelius. Sir, I don't have any idea what she's 
looking at. I can tell you that, again, based on what we've 
seen in the market, what we've seen in the plans, people will 
be getting full insurance for the first time at competitive 
prices.
    Mr. Cassidy. Well, again, this is what she reports. Do you 
think it's fair--if what she reports is true, do you think it's 
fair?
    Secretary Sebelius. I can't answer fair or not fair. I 
don't know what she was paying or what she was paying before--
--
    Mr. Cassidy. That's OK. Let's move on.
    Secretary Sebelius. Did she have full insurance?
    Mr. Cassidy. Richard writes that his daughter received a 
note that his premium's going up because she's being lumped 
with older, costlier patients. Now, it's possible that the only 
people that sign up will be those who are more costly. Does HHS 
have plans on what to do if only those who are more costly sign 
up and premiums rise for everybody?
    Secretary Sebelius. I think, sir, that's what we're trying 
to do to make sure that----
    Mr. Cassidy. But if only the costly----
    Secretary Sebelius [continuing]. With the individual 
mandate----
    Mr. Cassidy [continuing]. Sign up, do you have plans?
    Secretary Sebelius. That's the importance of the individual 
mandate that you've just outlined. Getting rid of preexisting 
conditions, making sure that people who come in----
    Mr. Cassidy. But if only the most costly sign up, do you 
have backup plans?
    Secretary Sebelius. We will encourage others to sign up. 
It's why there's a penalty in place and why----
    Mr. Cassidy. Is this to assume that there are no backup 
plans? I don't mean to be rude, but----
    Mr. Upton. Gentleman's time has expired.
    Mr. Yarmuth.
    Mr. Yarmuth. Thank you, Mr. Chairman.
    Madam Secretary, nice to see you.
    I come to this hearing with a little bit different 
perspective. Kentucky is doing a great job with our exchange. 
As of this morning, we have 350,000 people that have explored 
the Web site, 59,000 started applications, 31,000 are now fully 
enrolled in new coverage, and 5,000 just in the last week. And 
I think, very importantly, more than 400 businesses have begun 
applying for their employees as well. So the idea that somehow 
this is going to be bad for businesses is not borne out in 
Kentucky.
    Would it be safe to say that if 36 States had done what 
Kentucky and New York and California have done instead of 14, 
that the rollout would have been much smoother, and the Web 
site would have been much easier to construct?
    Secretary Sebelius. I don't think there's any question that 
the--you know, in January of 2013, we knew how many States were 
not running their own Web site. In, I think, mid-February we 
learned about partnerships. So it was not until that point that 
we learned that 36 States would actually be coming through the 
Web site.
    Having said that, we should have anticipated, we should 
have planned better, we should have tested better. I don't 
think that's any excuse. But we clearly are a running very 
different vehicle for enrollment than we thought we were going 
to run in March of 2010.
    Mr. Yarmuth. On the subject of cancellation of policies, 
isn't it true that, first of all, the Federal Government can't 
require insurance companies to sell insurance?
    Secretary Sebelius. That they can't?
    Mr. Yarmuth. Federal Government can't require insurance 
companies to sell insurance?
    Secretary Sebelius. Yes, that's true. Yes, sir.
    Mr. Yarmuth. And, in fact, insurance companies all over the 
country are making very difficult decisions now about where 
they want to participate and where they don't. And in some 
markets they are actually trying to get out of the market, 
canceling people, because they want to play in other markets 
and so forth. They are all making those decisions now.
    Secretary Sebelius. Well, and we know we have more 
insurers, 25 percent more insurers, in the individual market 
than we did prior to the law being passed.
    Mr. Yarmuth. So there are a lot of dynamics going on here 
that are not necessarily an indication that the President 
misled anybody. There are business decisions being made all 
over now.
    Secretary Sebelius. Well, in cancellation of policies, 
again, the 1-year contract notice is a routine in the 
individual market. It has been in place for years. And for a 
lot of people, they are policies now; they are being canceled 
because they are being notified you can no longer being 
medically underwritten. We can't charge you more because you're 
a woman. We won't ever have the kind of limitation on what your 
policy can pay out or charge you exorbitant out-of-pocket 
rates. Those policies will cease to be offered in the 
marketplace.
    Mr. Upton. Gentleman's time has expired.
    Mr. Guthrie.
    Mr. Guthrie. Thank you, Madam Secretary, for being here. 
And last week Mr. Lau from Serco was here. I know the 
President's talked about the alternatives to the Web site is 
phone calling or using paper, paper application. And what he 
said, and I think you've said it with the phone, they take the 
paper applications, but they enter them into the same Web 
portal. So I know you get around the issue of getting on and 
getting logged off, but also--but there are still issues with 
data within the Web portal. As you said, you can't even get 
reliable data who's even signed up.
    So he also said because of the surge in paper applications, 
it's, like, 6 to 8 weeks to process. So if November 30th is 
when this will be ready that they can use--and even if you do 
it now, 8 weeks, you're getting close to January 1st--if 
somebody does lose their insurance, so they're signing up for 
this, and they get to January 1st, even though you have a March 
31st open enrollment, what happens to these? Is there a 
contingency plan for these people to continue their insurance?
    Secretary Sebelius. Sir, I think that we have improvements 
every day on the speed of the site. Serco was giving you early 
snapshots of difficulty of accessing the site. I think that's 
greatly improved----
    Mr. Guthrie. Well, they said just processing the paper, 
actually. OK.
    Secretary Sebelius. I understand. But it is the site for--
they put the application into the site and get a determination. 
That's part of what the process is.
    So the site is part of the portal all the way through. This 
is an integrated insurance vehicle, and so that will improve. 
And we--again, with 4 months of continuous service, which is 
far longer than most people had, some of these cancellation 
numbers--Mr. Geraghty again pointed this out from Florida Blue 
Cross, but it's true of everyone else--these are not January 
1st numbers, they are year-long numbers. So over the course of 
2014, when an individual's policy is due to expire, that 
individual----
    Mr. Guthrie. But somebody's could expire January 1st and 
not be able to get coverage if the Web site--and the vendors 
said they needed months to test, they would have liked to have 
months and months to test. That's what they said. So if we are 
going to get November--even if it works November 30th----
    Secretary Sebelius. I would say we're testing as we go. 
This is beta testing going out right now. That's why we're 
fixing and how we can identify things. People are getting 
through every day. And we now know a lot more----
    Mr. Guthrie. I know I'm out of--but the paper process, if 
it does take even 4 weeks, and it's November 30th, and people's 
cancel on January 1st, you--there needs to be a contingency for 
that person.
    Secretary Sebelius. Well, again, typical insurance is 2 to 
4 weeks of sign-up. They will have 2 full months of sign-up.
    Mr. Upton. Gentleman's time has expired.
    Ms. Schakowsky.
    Ms. Schakowsky. Thank you, Madam Secretary, for bringing to 
millions of Americans access to affordable, comprehensive 
healthcare coverage that's going to be there when they need it.
    I want to thank you especially as a woman. Women can no 
longer--being a woman can no longer considered being a 
preexisting condition. Women can no longer be charged more than 
a man for the same coverage. Women have access to comprehensive 
benefits like prescription drugs, and free preventive 
screenings, and free contraceptive coverage, and maternity 
care, which is often left out of coverage. And the days of 
complicated pregnancy, or diabetes, or domestic violence being 
a preexisting condition, those days are over.
    You know, I want to say to my colleagues, after a 3-1/2-
year campaign to repeal, to discredit, to even shut down the 
government over Obamacare, I want to say, get over it. We all 
agree that there are problems, but these are problems that I 
see being fixed.
    And so I want to ask one--oh, and I want to say that what 
we did under Medicare Part D can be an example of how we can 
work together. And, in fact, Chairman Upton and I both sent a 
letter asking for more money for community-based groups to help 
implement the program and make it work. We can work together.
    So if you could just briefly say how are the navigators; 
how important are they in making this system work for the 
American people?
    Secretary Sebelius. Well, what we know, Congresswoman, is 
that a lot of people are not Web savvy and are not frustrated 
by the Web site, because they don't have a computer, they don't 
want to use a computer, they don't trust a computer. They need 
a live human being to ask questions, get questions answered, 
talk about the plan, talk about insurance. So the navigators 
play a hugely important role.
    We have about 2,500 trained navigators on the ground right 
now. We have thousands more community assisters who are trained 
and ready to go. About 45,000 agents and brokers have gone 
through specific Affordable Care Act training. But those 
individuals working with their clients, customers, and, in the 
case of navigators and community assisters, just the public at 
large, they are not paid by a company, they are not collecting 
a fee, they just want to help people get coverage, they are 
hugely important.
    Ms. Schakowsky. Thank you.
    Mr. Upton. Gentlelady's time has expired.
    Mr. Olson.
    Mr. Olson. I thank the chair.
    And welcome, Madam Secretary.
    Secretary Sebelius. Thank you.
    Mr. Olson. I'd like to open with a quote from an American 
icon. I'll hold up a poster. It says, ``If a user is having a 
problem, it's our problem.'' I'm glad to hear that you embrace 
this philosophy during your testimony, ma'am.
    Obamacare was signed into law 1,256 days ago, and since 
then there's been user problem after user problem after user 
problem.
    Regarding HealthCare.gov, your Deputy Administrator for 
Consumer Information, Gary Cohen, testified 1 month ago, right 
where you're sitting, that--and this is a quote--``CMS has 
worked hard to test the infrastructure that will allow 
Americans to enroll in coverage confidently, simply, and 
securely,'' end quote. Yet according to Forbes and the Wall 
Street Journal, you told them that you needed 5 years of 
construction and 1 year of testing. The program has crashed and 
burned at least three times, and the user is still having 
problems. It's been down the whole time you've been testifying. 
The system is down at this moment.
    My question, ma'am, is very simple: When did you know these 
changes were going down? A month? A day? A quarter? And did you 
tell the President what you knew?
    Secretary Sebelius. Sir, I was informed that we were ready 
to launch on October 1st. The contractors who we had as our 
private partners told us and told this committee that they had 
never suggested a delay, and that is accurate. Our CMS team 
felt we were ready to go.
    I told the President that we were ready to go. Clearly I 
was wrong. We were wrong. I--we knew that in any big, new, 
complicated system, there would be problems. No one ever 
imagined the volume of issues and problems that we've had, and 
we must fix it.
    Mr. Olson. Yes, ma'am.
    Credible journalists said you know you needed 6 years to 
get the program up and running.
    Secretary Sebelius. Sir, that quote has been repeated. I 
can guarantee you I would have never stated that, because the 
law was passed in March of 2010. I chose the open enrollment 
date. I don't know where that quote comes from, but that is not 
from me.
    Mr. Upton. Gentleman's time has expired.
    Mr. Barrow.
    Mr. Barrow. Thank you, Mr. Chairman.
    And thanks for attending today, Madam Secretary. I suspect 
that deep down most people on this committee support the 
concept of reforming insurance markets so that more people have 
access to better insurance coverage. We have disagreements 
about the means used to get at those ends, which is ultimately 
why I voted against the Affordable Care Act.
    But it seems that every day we're hearing of something new 
going wrong. I'm concerned that these short-term enrollment 
problems could become long-term insurance market problems. My 
constituents are already losing confidence in the Federal 
Government's ability to pull this thing off, and I think the 
only way to begin to restore their trust is to delay the 
individual mandate penalties until we're sure this system is 
going to work. It's not fair to penalize consumers when their 
noncompliance is not their fault.
    We also need to take the time make sure additional fits and 
starts won't cause larger problems. Right now I'm less 
concerned about who's to blame, more concerned about what went 
wrong and how to fix it and how we're going to ensure it 
doesn't happen again.
    Nearly all of our constituents want and need health 
insurance. It would be a huge mistake if we were so blinded by 
our love or our hatred for Obamacare that we miss opportunities 
to address its flaws.
    Now to the subject of technical problems becoming market 
problems. Can problems of folks getting into the system 
snowball into risk pool problems where those who choose not to 
enroll can actually affect the cost of those who do choose to 
enroll?
    Secretary Sebelius. Certainly. A risk pool needs a balanced 
market, so you need people who are older and sicker to be 
balanced with people who are younger and healthier. That's how 
a pool works.
    Mr. Barrow. At what point are we going to see a problem 
having the risk pool if the tech problems cause--affecting the 
folks who are entering? What are we going to look for? What are 
we going to use to decide something needs to be done?
    Secretary Sebelius. Well, again, sir, we will be monitoring 
during the 6 months of open enrollment, as will our insurance 
partners, who is coming into the pool. That's why we want to 
give this committee and others reliable, informed data about 
not only who it is, but what the demographics are and where 
they live. That's part of our target.
    Mr. Barrow. If things aren't better by the end of this next 
month, at what point are we going to start thinking about 
further delays and imposing penalties?
    Secretary Sebelius. Well, again, I think that having a 
defined open enrollment period is one of the ways that you then 
make an assessment if you have a pool that works or not. You 
cannot have an unlimited open enrollment period with any 
insurance company, because that really doesn't work.
    Mr. Barrow. Thank you.
    Mr. Upton. Mr. McKinley.
    Mr. McKinley. Thank you, Mr. Chairman.
    Last week the CGI representative Campbell said she had met 
her contract obligations and met the specifications. And she 
said the only problem she had was with pace, but the pace 
wasn't part of the specification. We asked her what you would--
you would testify to. Did--she said you would testify that she 
did complete her contract in accordance with the 
specifications. Would you?
    Secretary Sebelius. Sir, I don't think until the product is 
working the way it's designed to work that anybody has finished 
their job. And that's really my interest.
    Mr. McKinley. Thank you. I'm sorry, with time, they've 
shortened our time.
    So if she hasn't met their specifications, but yet we're 
still using her, so is the American taxpayer still paying the 
money to fix the problems that her company didn't do in the 
first place?
    Secretary Sebelius. None of our contractors have been paid 
the amount of their----
    Mr. McKinley. Will she be paid for this work into the 
future as we go to correct this problem?
    Secretary Sebelius. We will make that determination as the 
work goes forward. I would tell you, sir, that as we learn what 
needs to be fixed, how long it takes, we'll know more about 
whether they delivered.
    Mr. McKinley. I'm very sorry, but the time frame has been 
cut down.
    Who owns the software now? Now that this has been developed 
with taxpayer money to develop the software to do this----
    Secretary Sebelius. It is owned by the Centers for Medicaid 
& Medicare Services.
    Mr. McKinley. So it's all owned by us. OK.
    Will they be able to use it by a license for other clients?
    Secretary Sebelius. Not to my knowledge. I think it is 
specifically designed for the marketplace with these products 
in mind.
    Mr. McKinley. Thank you.
    Then last question to trying to work----
    Secretary Sebelius. And the clients are the American 
public.
    Mr. McKinley [continuing]. Under IV&V, and she testified 
that she thought that was something we should have done. Under 
HHS, you recommend or the HHS recommends that for software 
development, that they should have an independent verification 
and validation program, but it wasn't used in this case. Can 
you share with us in the--the time that's gone why we didn't 
use IV&V on something that's----
    Secretary Sebelius. Again, I don't think that's accurate, 
sir. At every point along the way, there is independent 
testing. There is----
    Mr. McKinley. Independent.
    Secretary Sebelius. Yes.
    Mr. McKinley. You recommend independent----
    Secretary Sebelius. An outside----
    Mr. McKinley [continuing]. Verification and validation. Not 
someone within your staff.
    Secretary Sebelius. Pardon me? There is a level of company 
self-attested testing, there is a level of CMS testing and then 
there is an independent test on each piece of the contracting; 
an independent, not CMS.
    Mr. McKinley. You've acknowledged it wasn't done 
independently, and that's the----
    Mr. Upton. The gentlemen's time----
    Mr. McKinley. It needs to be done independently. People 
that do not have a----
    Mr. Upton [continuing]. Has expired.
    Secretary Sebelius. No.
    Mr. McKinley [continuing]. A dog in the fight.
    Secretary Sebelius. It isn't CMS. I will get you the 
information. There are three levels of testing. One of them is 
independent for every piece of this contracting, yes.
    Mr. Upton. Mrs. Castor.
    Ms. Castor. Good morning. When open enrollment began a few 
weeks ago, the people back home in Florida who are helping 
their neighbors sort through the new options for coverage, the 
navigators, were taken aback by how grateful people are to have 
a new pathway to the doctor's office and the care they need, 
affordable options. They're no longer being discriminated 
against because they had cancer and diabetes or asthma, and 
they are very grateful. They said to me directly it's like they 
found water in the desert.
    Right now they are--surprisingly, they said it's taking 
time, because people want to sort through all of these options 
before they finally sign up at the end of the 26-week 
enrollment period.
    So we must fix the marketplace, we must, to meet their 
expectations. And we have very high expectations for you and 
for the administration.
    But I think it's important to point out the Affordable Care 
Act is more than just a Web site. Despite all the obstruction 
by Republicans in my home State of Florida, nationally, even 
going so far as to shut down the government, millions of 
Americans are already benefiting, and they are benefits that 
are not tied to HealthCare.gov.
    So, Madam Secretary, let's clarify what's working, despite 
HealthCare.gov. Is it correct to say that many of the 
improvements that the ACA makes to employer coverage and to 
Medicare, where the vast majority of Americans who receive 
their coverage, are not dependent on HealthCare.gov?
    Secretary Sebelius. That's correct.
    Ms. Castor. And so the delays and problems with 
HealthCare.gov do not affect the millions of individuals, 
thanks to the ACA, who no longer have to worry about lifetime 
monetary caps on their coverage that previously sent them to 
bankruptcy?
    Secretary Sebelius. That's absolutely true. And I think the 
quote that the President was quoted recently saying if you have 
health care, you can--you don't have to sign up for the new 
marketplace was referring to that large portion, the 95 percent 
of insured Americans whose plans are solid, stay in place and 
move forward.
    Ms. Castor. And I understand the frustration with the Web 
site. What I don't understand is why people are not similarly 
outraged by the lack of Medicaid coverage in many of our 
States. Do you find that hypocritical?
    Secretary Sebelius. Well, I think it's very troubling that 
millions of low-income working Americans will still have no 
affordable option if States don't take advantage of the 
expansion program, leaving States bearing the cost of 
uncompensated care, families bearing the costs of parents who 
can't take care of their kids, workers not able to go to work, 
and people still accessing care through emergency room doors, 
the most expensive, least effective kind of care they could 
get.
    Mr. Upton. The gentlelady's time has expired. Mr. Gardner.
    Mr. Gardner. Thank you, Mr. Chairman. And thank you, 
Secretary Sebelius, for being here.
    Here's my letter. This is the letter that my family got 
canceling our insurance. We chose to have our own private 
policy back in Colorado so we could be in the same boat as 
every one of my constituents, and yet my insurance policy has 
been canceled. The White House Web site says, if you like your 
health plan you have, you can keep it. Did I hear it wrong?
    Secretary Sebelius. Again, sir, I don't know how long 
you've had your policy or what policy----
    Mr. Gardner. Why aren't you losing your insurance?
    Secretary Sebelius. Pardon me?
    Mr. Gardner. Why aren't you losing your health insurance?
    Secretary Sebelius. Because I'm part of the Federal 
Employee Health Benefits plan.
    Mr. Gardner. Where aren't you in the exchange? You're in 
charge of this law, correct? Why aren't you in the exchange?
    Secretary Sebelius. Because I'm part of the Federal 
Employee Health Benefits plan.
    Mr. Gardner. Why aren't you in the exchange? Why won't you 
go into the exchange? You're a part of this law. You're 
literally in charge of this law. Should you be any different 
than all of the other Americans out there who are losing their 
health insurance today?
    Secretary Sebelius. I'm part of the 95 percent with 
affordable available health coverage, as are----
    Mr. Gardner. You're part of a plan that----
    Secretary Sebelius [continuing]. Most of your colleagues in 
this room.
    Mr. Gardner [continuing]. Most Americans don't have 
available to them. Why will you not agree to go into the 
exchange?
    Secretary Sebelius. I am not eligible for the exchange.
    Mr. Gardner. I went into the exchange.
    Secretary Sebelius. Because I have coverage in----
    Mr. Gardner. You can decide----
    Secretary Sebelius [continuing]. The employee side.
    Mr. Gardner [continuing]. To drop the coverage of your 
employer. You have the choice to decide not to choose----
    Secretary Sebelius. Well, I--that is not true, sir.
    Mr. Gardner. I chose not to go into the congressional----
    Secretary Sebelius. Members of Congress are now part of the 
exchange thanks to an amendment----
    Mr. Gardner. Before----
    Secretary Sebelius [continuing]. That was added by 
Congress, but I am not eligible----
    Mr. Gardner. Madam Secretary, with all due respect----
    Secretary Sebelius. If I have affordable coverage in my 
workplace, I am not eligible to go into the marketplace.
    Mr. Gardner. With all due respect, Madam, I would----
    Secretary Sebelius. That's part of the law.
    Mr. Gardner [continuing]. Madam Secretary, I would 
encourage you to be just like the American people and enter the 
exchange----
    Secretary Sebelius. I----
    Mr. Gardner [continuing]. And agree to find a way to do 
that, Madam Chair.
    Secretary Sebelius. It's illegal.
    Mr. Gardner. Madam Secretary. And I would like to show you 
an advertisement that's going on in Colorado right now. This is 
an advertisement that a board member of the Colorado exchange 
has put forward. Do you agree with this kind of advertising 
for----
    Secretary Sebelius. I----
    Mr. Gardner [continuing]. Obamacare?
    Secretary Sebelius. I can't see it. And, again, it's----
    Mr. Gardner. It's a college student doing a keg stand.
    Secretary Sebelius. If the Colorado exchange did that, they 
are----
    Mr. Gardner. Do you approve of this kind of advertising?
    Secretary Sebelius [continuing]. A State-based marketplace.
    Mr. Gardner. Do you approve of this kind of advertising?
    Secretary Sebelius. I don't see it. I don't know what it 
is, and I did not approve it. This is a State-based 
marketplace.
    Mr. Gardner. That's a pretty big font, that's a pretty big 
picture of a keg----
    Secretary Sebelius. I----
    Mr. Gardner [continuing]. And you can't see it?
    Secretary Sebelius. Sir, do I approve of it.
    Mr. Gardner. You----
    Secretary Sebelius. I've never seen it.
    Mr. Gardner. You have the ability to opt out, by the way, 
as a Federal employee. You could take the insurance. So I 
just----
    Secretary Sebelius. If I have----
    Mr. Gardner. I would encourage you to make that decision.
    Secretary Sebelius [continuing]. Available employer-based 
coverage, I am----
    Mr. Gardner. I would also like to submit a----
    Secretary Sebelius [continuing]. Ineligible for----
    Mr. Gardner [continuing]. Waiver from my district from 
Obamacare, and hope that you will consider waiving Obamacare 
for the Fourth Congressional District.
    Mr. Upton. Gentleman's time has expired.
    Mr. Waxman. Does your policy cover--never mind.
    Mr. Upton. Mr. Matheson.
    Mr. Matheson. Well, thank you, Mr. Chairman. And, Madam 
Secretary, thanks for your time. I just want to ask, on the 
issue of the fixes to HealthCare.gov, we've had a lot of 
conversation about that today, and we've talked about 
confidence levels for being ready by a certain time, but I 
think one question that a lot of us have is can you define what 
the magnitude of the problem is? Is there a scale or a metric 
by which we can understand how bad this is today and how we're 
going to get to where we go to have it fixed?
    Secretary Sebelius. Well, again, sir, I've been informed 
that the problems are in--and the reports I've seen are really 
in two areas. They are in the performance area, which is speed 
and reliability. It's too slow, it doesn't have reliable 
transfers. And in functionality. There are parts of the system 
that just don't make accurate transfers. So we have done an 
extensive assessment. They are prioritized, as I indicated 
earlier. One of the priorities is the enrollment features which 
pass individual information to the companies where they want to 
enroll. That is not reliable at this point. The companies are 
not getting accurate data. So it's an example of the kind of 
thing we know we need to fix.
    Mr. Matheson. And is there a way to have you set up your 
metrics to figure out if we're making progress in terms of if 
you're fixing those issues with speed and performance and 
functionality?
    Secretary Sebelius. Again, with a team and Jeff Zients at 
the head of it reporting to Marilyn, there are definitely a 
comprehensive set of issues going forward that will be measured 
and accelerated.
    Mr. Matheson. Do you have target dates along the way if you 
want to meet the November 30th time to assume it's functional 
at what you want, do you have target or metrics along the way 
to make sure you're on that path?
    Secretary Sebelius. My understanding is yes, there are sort 
of groups of targets, that fixes, as you know, can be loaded 
together.
    Mr. Matheson. Right.
    Secretary Sebelius. It isn't one at a time, so they don't 
take days, but they're trying to determine with a specific 
path, it's one of the charges that QSSI has really looking at 
the umbrella of what needs to be fixed, prioritizing them, 
figuring out what destabilizes if something else is fixed, how 
they can be grouped together, and that report will be in later 
next week.
    Mr. Matheson. OK.
    Mr. Upton. The gentleman's time has expired. Mr. Pompeo.
    Mr. Pompeo. Great. Thank you. Thank you for coming, 
Secretary Sebelius. It won't surprise you that I would like to 
talk about Kansas a little bit today. Much like with some of my 
colleagues that made references to the ``Wizard of Oz,'' I 
don't think anybody not from Kansas should be able to do Oz 
allegories, but my story, the way I think about it is those 
folks worked awful hard to go down that yellow brick road, and 
at the end of the day when they got there and pulled back the 
curtain, they found out there was nothing that they didn't 
already have. And as we pull back the curtain on the Affordable 
Care Act, I think people are finding that it's not exactly what 
they are going to have worked so hard to find their way to as 
well.
    I want to talk about two stories. There's this commitment 
that said if you like your plan, you can keep it. I have a 
letter I'll submit for the record from Mr. Brito in Kansas. You 
might know him. I saw him the other night in Benton. He got the 
following letter from Blue Cross Blue Shield that says, because 
your current plan does not offer the benefits standards 
specified, you will be discontinued on December 31st. And it 
says, good news. And then there's a group of folks, Pizza Hut, 
you know the company from Kansas, franchisees, founded there.
    Secretary Sebelius. Yes, I do.
    Mr. Pompeo. Lots of those folks have now taken employees, 
families who were working there, and they've gone from having 
full-time jobs to part-time jobs, so they aren't able to keep 
the health care plan that they had either and the one that they 
wanted.
    Why were the plans these folks had good enough when you 
were the insurance commissioner in Kansas and when you were 
Kansas's governor, but those plans today aren't good enough for 
those hardworking Kansas families?
    Secretary Sebelius. Sir, I would tell you in the roles I 
had the honor of serving of in Kansas, I worked every day to 
try and eliminate some of the discriminatory features of the 
insurance industry that finally, with the Affordable Care Act, 
are gone. My successor and elected insurance Republican 
commissioner, Sandy Praeger and I worked on a whole series of 
plans to expand coverage. So I did----
    Mr. Pompeo. But----
    Secretary Sebelius [continuing]. Work on these issues. We 
were not able to necessarily----
    Mr. Pompeo. So you thought these----
    Secretary Sebelius [continuing]. Get them passed.
    Mr. Pompeo. To use your words, you said these were, I think 
you said, lousy plans, and Ms. Tavenner said, not true 
insurance. You think that the plans that were offered when you 
were insurance commissioner weren't true insurance?
    Secretary Sebelius. In the individual market, the insurance 
commissioner in Kansas and virtually every place in the 
country----
    Mr. Pompeo. So if the----
    Secretary Sebelius [continuing]. Does not have regulatory 
authority over the plans----
    Mr. Pompeo. Let me ask the questions.
    Secretary Sebelius [continuing]. And a lot of them are not 
insurance.
    Mr. Pompeo. Were they true insurance plans when you were 
insurance commissioner?
    Secretary Sebelius. A lot of them were not true insurance 
plans, no.
    Mr. Pompeo. Thank you. I yield back.
    Mr. Upton. Gentleman from Vermont, Mr. Welch.
    Mr. Welch. Thank you. I'm going to try to just summarize 
correctly what I've been hearing. Number one, the Web site must 
be fixed, you've been very forthright, and you're going to fix 
it.
    Number two, I'm hearing a tone change. We've had a real 
battle about health care. We had a battle in this Congress. It 
was passed. The President signed it. The Supreme Court affirmed 
it. A really brutal battle. There was an election where the 
American people affirmed it. And then the last gasp effort was 
the shutdown and the threat of debt default. But what I'm 
hearing today is that there are problems and people want to fix 
them, because all of us represent people who are going to win 
or lose depending upon how effectively this is rolled out.
    Third, there's some significant question about existing 
insurance policies, what the President said and so on, but 
let's acknowledge something. A lot of insurance companies were 
ripping off innocent American people by promising them 
insurance until they got sick, and then it got canceled because 
they ``had a pre-existing condition that wasn't, `disclosed.''' 
That's got to end. The challenge for us going forward is to 
make health care affordable.
    So, Madam Secretary, my question is, is there any 
indication that there's been a slowing of premium increases as 
a result of the Affordable Care Act, because unless we can keep 
those premium increases down, they can't rise faster than the 
rate of inflation, wages and profits, all of us are going to 
lose.
    Secretary Sebelius. Well, I would say the trends in the 
private market over the last 3 \1/2\ years are that cost 
increases have slowed down, are rising at a lower rate than the 
decades before. And, in fact, in this individual market, the 
old individual market, the typical increase was 16 percent year 
in and year out, rate increase, and often that came with 
additional medical underwriting. So it gives you a sense of how 
the costs were.
    We know that Medicare costs are down. We know that Medicaid 
costs actually had a decrease per capita last year, not an 
increase per capita, and underlying health care costs are down.
    These rates in the new marketplace, have come in about 16 
percent lower on average than was projected; not by us, but by 
the Congressional Budget Office. And we know that in many of 
these markets, they're much more competitive. I believe in 
market competitiveness. That actually drives down rates. The 
States where the most companies are participating have the 
lowest rates. And new companies have come in significantly 
below the old monopoly companies that often dominated this 
individual marketplace. So we're on a pathway. Are we there? 
No. But you're absolutely right: affordable coverage at the end 
of the day for everybody is the goal.
    Mr. Welch. OK. I yield back. Thank you, Madam Secretary.
    Mr. Upton. Madam Secretary, I'm trying to make sure that 
you're out of here by 12:30 before we start the second round of 
questions.
    Mr. Kinzinger.
    Secretary Sebelius. That was a joke, right.
    Mr. McKinley. I see sheer panic.
    Madam Secretary, thank you for being here. You stated 
earlier to Mr. Harper that you give the President regular 
updates on the marketplace. The President stated that he knew 
nothing about the status and functionality of the marketplace. 
How often and what were the subjects of those updates?
    Secretary Sebelius. Well, I think there were a series of 
regular meetings with the President, with some of our Federal 
partners, with offices of the White House, from the OMB to 
others on a monthly basis giving reports on policy and where we 
were going. None of those, I would say, involved detailed 
operational discussions. That wasn't the level. It was, are we 
coming together? Do we have companies? Do we have plans?
    Mr. McKinley. Sure. And I understand that. I mean, 
obviously when it comes to the President of the United States, 
certain level of details, you have to see it kind of a 10-, 
20,000-foot overview, but in terms of the actual functionality, 
whether it's the Web site or the marketplace, he was 
legitimately caught off guard on October----
    Secretary Sebelius. Well, I assured him that we were ready 
to go. Everyone knew with a big plan that there were likely to 
be some problems. No one----
    Mr. Kinzinger. OK.
    Secretary Sebelius [continuing]. Anticipated this level of 
problems.
    Mr. Kinzinger. And just a second, a quick question. Where 
is HHS getting the money to pay for these fixes? Is it coming 
from other HHS accounts? Have you used your transfer authority 
to move money from non-ACA programs to pay for the cost of 
implementing the President's health care program, and if so, 
from which programs have you drawn money to help with the fix 
that's not ACA-related?
    Secretary Sebelius. Well, as you know, Congressman, it's 
been 2 years since we've had a budget at HHS and we also have 
not had--at the President's requested implementation budget 
authorized by the Congress, each of those years we have used 
not only resources internally, but I do have legal transfer 
authority that I've used and a non-recurring expense fund. We 
will get you all the details of that.
    Mr. Kinzinger. Great. Thank you.
    Secretary Sebelius. We've been reporting that to Congress 
regularly.
    Mr. Kinzinger. So the answer is yes, though, there is some 
non-ACA money being transferred and used for the implementation 
of ACA?
    Secretary Sebelius. There is money that is specifically 
designed for either outreach and education, so the health 
centers have hired education outreach people as part of their 
outreach for health personnel. I would say it's definitely a 
related cause to get expanded health care.
    Mr. Kinzinger. Thank you. Thank you, Mr. Chairman.
    Mr. Upton. Mr. Sarbanes.
    Mr. Sarbanes. Thank you, Mr. Chairman. Thank you, Madam 
Secretary, for being here. My understanding is that a lot of 
the companies, insurers that have been offering plans in the 
individual market, the ones who are sending out these notices 
are actually repositioning themselves in the health insurance 
exchange to offer alternative plans. Is that correct?
    Secretary Sebelius. Yes.
    Mr. Sarbanes. And in addition to those insurers who've been 
in the individual market, you now have a lot of other companies 
and insurers providing plans in the health insurance market?
    Secretary Sebelius. That is true.
    Mr. Sarbanes. So the way I look at this is, I went to buy 
Orioles tickets a while back when the season was still 
underway, and I was standing in line and I got up to the ticket 
window, and they closed the window, but I didn't have to go 
home, because they opened another window a few feet away.
    So essentially what's happening is people are coming up on 
the renewal period, they're getting up to the window of the 
individual market, they're being told, well, that window's 
closed, but if you go right down the line here, there's another 
window that's open. And, by the way, when you get there, you 
will get better coverage potentially at reduced premiums, and 
if you go down to window three, there's some subsidies that may 
also be available to you.
    So this notion that people are being turned away from an 
affordable product that provides good, quality care is 
preposterous. In fact, they're being steered to a place where 
they can get good quality coverage, in many instances much 
better than the coverage that they had before, at an affordable 
rate that is supported by the subsidies that can be available 
to many, many people.
    This is what's so promising about the Affordable Care Act, 
and so I think it's important for people to understand that 
that window is not being shut, they're just being steered 
someplace else where they can get a good opportunity.
    Secretary Sebelius. And I think the first option for those 
companies is to say we'd like to keep you here and here are the 
plans we're offering, but to be fair, customers will now have 
an opportunity to look across a landscape, which they couldn't 
before, they will have entry into those other windows, which 
many of them didn't have before with a pre-existing condition, 
and as you say, about 50 percent of this market will have 
financial help in purchasing health insurance, which none of 
them had before.
    Mr. Upton. Gentleman's time has expired. Mr. Griffith.
    Mr. Griffith. Thank you, Mr. Chairman.
    Earlier in your testimony here today, you said a couple 
times the plans we enjoy, but then as you noticed with Mr. 
Gardner's eloquent testimony, that we're not going to be in the 
same plan that you're in after January 1. I was one of those 
who thought it was a good idea as a part of a proposal that was 
floating around the halls here in Congress that the President 
and the cabinet secretaries ought to also be in the marketplace 
and not have a special Federal plan that you will have after 
January 1, but that we will not.
    The President, while that was being discussed, issued a 
veto threat. Did you discuss the veto threat with the President 
before he made it and have you discussed it with him since 
then? Yes or no on the first.
    Secretary Sebelius. No.
    Mr. Griffith. No. And then I would have to ask you relating 
back to the contractors involved in this, CGI told us that the 
Spanish Web site was ready to go, that they thought everything 
was ready just as they did with the regular site, and obviously 
that didn't prove out, but that they were told not to implement 
it; likewise, the shop and browse section was ready to go. Do 
you think that they were misleading this committee when they 
made those comments?
    Secretary Sebelius. I think what they believed is that that 
product, independent of the entire operational site, was ready 
and tested. What--a determination was made. I was involved with 
the Spanish Web site----
    Mr. Griffith. Let me----
    Secretary Sebelius [continuing]. And the Medicaid transfers 
to say let's minimize the risk for the whole site, let's load--
--
    Mr. Griffith. But let----
    Secretary Sebelius [continuing]. These later.
    Mr. Griffith. But that raises the next question now, 
because one of the other contractors, QSSI, I believe it was, 
indicated to us that part of the problem was was that once you 
took away the ability to browse, everybody had to go through 
the business of setting up an account, and you stopped one of 
the browse--or CMS stopped one of the browsing options as well, 
and that that actually contributed to the logjam and 
contributed to the problems. So is he correct on that, that not 
allowing people just to look without having to sign up, 
wouldn't that have made it easier for the American people?
    Secretary Sebelius. In hindsight, I think that probably 
would have been advantageous. I can tell you that the reason 
the decision was made going forward was to minimize risk. That 
didn't work so well, but adding additional features that didn't 
involve people actually wanting to get to what they would 
independently pay and what they would qualify for and what the 
plans were seemed to be things that could be added down the 
road. It was wrong.
    Mr. Upton. Gentleman's time has expired. Mr. Bilirakis.
    Mr. Bilirakis. Thank you Mr. Chairman. I appreciate it very 
much. Thank you, Madam Secretary, for testifying today.
    Madam Secretary, over the weekend, The New York Times wrote 
the following: ``Project managers at the Department of Health 
and Human Services assured the White House that any remaining 
problems could be worked out once the Web site went live, but 
other senior department officials predicted serious trouble and 
advised delaying the rollout.''
    Can you confirm if this is true? Did any senior department 
officials predict serious problems, and did any senior 
department officials advise delaying the rollout of the 
exchanges or parts of the exchanges on October 1st? Can you----
    Secretary Sebelius. I can tell you that no senior official 
reporting to me ever advised me that we should delay. You heard 
from the contractors on the 24th that none of them advised a 
delay. We have testing that did not advise a delay. So, not to 
my knowledge.
    Mr. Bilirakis. Did they indicate to you that there were 
serious problems?
    Secretary Sebelius. They indicated to me that we would 
always have risks, because this system is brand-new and no one 
has operated a system like this before to any degree. So we 
always knew that there would be the possibility that some 
things would go wrong. No one indicated that this could 
possibly go this wrong.
    Mr. Bilirakis. Can you name some of these officials that 
gave you that advice that there were serious problems?
    Secretary Sebelius. Again, we had a series of meetings with 
teams from CMS. I was always advised that there is always a 
risk with a new product and a new site, but never suggested 
that we delay the launch of October 1st, nor did our 
contracting partners ever suggest that to us.
    Mr. Bilirakis. Thank you. Thank you, Madam Secretary.
    Thank you, Mr. Chairman. Appreciate it. I yield back.
    Mr. Upton. Mr. Johnson.
    Mr. Johnson. Madam Secretary, thank you for being here with 
us today. CMS was the integrator of the Web site prior to and 
leading up to the 1 October----
    Secretary Sebelius. That's correct.
    Mr. Johnson [continuing]. Rollout, correct? You've 
testified that you've now hired an outside company to serve as 
the integrator. Who is that?
    Secretary Sebelius. One of our contractors is taking on an 
additional----
    Mr. Johnson. Who is that?
    Secretary Sebelius. QSSI----
    Mr. Johnson. QSSI.
    Secretary Sebelius [continuing]. Who built the hub.
    Mr. Johnson. OK.
    Secretary Sebelius. Yes, sir.
    Mr. Johnson. This is the same company that told our 
committee last week that they were not only the developer of 
the hub and the pipeline, but also an independent tester of 
system?
    Secretary Sebelius. Yes.
    Mr. Johnson. You've acknowledged in your testimony today 
that inadequate testing played a significant role in this 
failed launch, so aren't you concerned that QSSI has lost its 
ability to be an objective independent arbitrator in addressing 
the problems that plague the system now, because they're part 
of the tester, part of the developer, part of the problem?
    Secretary Sebelius. No, I haven't lost my confidence in 
them. I think the testing that they did is validating the 
pieces of the equipment. What we've said since the launch is 
that we did not do adequate end-to-end testing.
    Mr. Johnson. OK.
    Secretary Sebelius. That was not the QSSI responsibility.
    Mr. Johnson. All right. And in this new role as integrator, 
are you going to be paying QSSI more than they were to be paid 
under their original contract? I would expect with this 
expanded role, they're going to get paid more. Right?
    Secretary Sebelius. That discussion is underway in terms of 
what the role will entail, what the outlines are, yes, sir.
    Mr. Johnson. OK. Well, hardworking American taxpayers have 
already paid for this implementation once. Do you think it's 
fair to ask taxpayers to pay more so that QSSI can now attempt 
to do something that Administrator Tavenner and her CMS team 
were unable to do right the first time?
    Secretary Sebelius. Well, sir, I think the American 
taxpayers expect us to get the site up and running. As I told 
you earlier----
    Mr. Johnson. Well, I'm certain that they did. They expected 
it the first time.
    Secretary Sebelius. I understand. And so did I. We have not 
expended the funds that have been encumbered for the contracts.
    Mr. Johnson. You know, we----
    Secretary Sebelius. We have not----
    Mr. Johnson. Madam----
    Secretary Sebelius. And we will monitor every dime we spend 
from here on in and re-audit things that are going forward.
    Mr. Johnson. Well, with that, Mr. Chairman, I yield back.
    Mr. Upton. Gentleman yields back. Mr. Long.
    Mr. Long. Thank you, Mr. Chairman. And thank you, 
Secretary, for being here today and giving your testimony.
    Earlier today you said that, I'm responsible for the 
implementation of the Affordable Care Act. I've heard you 
referred to, and maybe yourself, as the point person for the 
rollout, the architect of implementing the Affordable Care Act. 
So you are kind of the President's point person, are you not, 
for this rollout?
    Secretary Sebelius. Yes, sir.
    Mr. Long. Earlier you were asked--and there's a lot of 
things striking about the rollout of this and about the 
Affordable Care Act altogether, but the thing that's most 
striking to me is that when we have the point person for the 
rollout here and you're not going into the exchange--now, I've 
heard you say that--and you've got some advice from the folks 
behind you, but I'm asking you today, can you tell the American 
public, if your advisors behind you that if they happen to have 
given you some wrong information, if it is possible for you to 
go into the exchange like all these millions of Americans that 
are going to go into the exchanges, will you commit to forego 
your government insurance plan that you're on now and join us 
in the pool?
    Come on in. The water's fine. All the Congressmen, all of 
our staff have to go into the exchanges. We have to go into the 
D.C. exchanges. And I will say that I tried to get on the Web 
site, I was successful during the hearing earlier, and I got to 
the D.C. exchange, which is where I have to buy from. I got 
part way through, and then when it got to the point to enter my 
Social Security number, I could not bring myself to do that 
from what I've heard from people like John McAfee and folks 
about the security.
    Will you tell--if your advisors are wrong and it is 
possible for you, I'm not saying it is, but if it is, if it's 
possible for you to forego your government program you have 
now, will you tell the American public that, yes, I will go 
into the exchanges next year like everyone else?
    Secretary Sebelius. Sir, the way the law is written----
    Mr. Long. It's a yes or no.
    Secretary Sebelius. We have----
    Mr. Long. Let's say that you're wrong on that. Yes or no? 
If you're wrong----
    Secretary Sebelius. I don't want to give----
    Mr. Long [continuing]. Will you, yes or no?
    Secretary Sebelius [continuing]. Misinformation to the 
American public----
    Mr. Long. You what?
    Secretary Sebelius [continuing]. I don't want to give 
misinformation.
    Mr. Long. I want you to go home and research it----
    Secretary Sebelius. If you have affordable----
    Mr. Long. If----
    Secretary Sebelius [continuing]. Coverage----
    Mr. Long. If you're wrong----
    Secretary Sebelius. If you have affordable coverage----
    Mr. Long [continuing]. Will you go into the exchanges?
    Secretary Sebelius. If I'm wrong----
    Mr. Long. If you can, will you? That's a yes or no. If you 
can, will you, ma'am?
    Secretary Sebelius. I will take a look at it. I don't have 
any idea----
    Mr. Long. That's not an answer. That's not a yes or no.
    Mr. Upton. Gentleman's time has expired.
    Mr. Long. You're the architect of the whole program, and 
you won't go into it with the rest of the American public.
    Secretary Sebelius. I did not say that, sir. I think it's 
illegal for me to----
    Mr. Long. If it's not illegal. If it's legal, will you go 
in?
    Secretary Sebelius. If I have affordable coverage----
    Mr. Long. Come in. The water's fine.
    Mr. Upton. The gentleman's time has expired.
    Mr. Waxman. I have a unanimous consent request. I'd like 
to--Madam Secretary, I'd like you to answer for the record, if 
you are able to do what the gentleman just suggested or follow 
the recommendation of Cory Gardner, our colleague from 
Colorado, and went in to buy an individual policy, would you be 
able to find one that would protect you from cheap shots, or do 
you think that it has to be mandated for coverage? I'll leave 
the record open for your response.
    Mr. Upton. We'll wait for that response to come back.
    Secretary Sebelius. I'd gladly join the exchange if I 
didn't have affordable coverage in my workplace. I would gladly 
join it. And the D.C. market is an independent State-based 
market, even though D.C. is not a State. We do not run the D.C. 
market in the Federal marketplace.
    Mr. Upton. The gentlelady from North Carolina, Ms. 
Ellimers.
    Mrs. Ellmers. Thank you, Mr. Chairman, and I have a couple 
of questions. Thank you for being with us today, Madam 
Secretary. I'd like to go to the issue that has been raised by 
my colleagues on the left here about accurate information. 
Number one, I've heard the issue of Medicare Part D brought up 
many, many times. Although my colleagues all voted no against 
it initially, now they're extolling the virtues of Medicare 
Part D. Is Medicare Part D a mandate or is it voluntary?
    Secretary Sebelius. It is voluntary.
    Mrs. Ellmers. It is a voluntary program.
    Secretary Sebelius. Yes.
    Mrs. Ellmers. That's the first accurate piece of accurate 
information I would like to get.
    You know, we're actually forcing millions of Americans to 
go to find a health care premium in some way, whether it's to 
go to the exchange or whether they are to be insured. Many of 
my constituents are reaching out to me, those with individual 
policies, and they are saying to me that my rates are going up 
400 percent, my rates are going up 127 percent. These are my 
constituents. Now, we're talking about open enrollment, but 
it's forcing the issue, is it not? That if an American does not 
have health care coverage, they are essentially breaking the 
law. Is that not correct?
    Secretary Sebelius. If someone can afford coverage and has 
that option and chooses not to buy coverage, they will pay a 
fee on their----
    Mrs. Ellmers. And that----
    Secretary Sebelius [continuing]. Liability in their----
    Mrs. Ellmers. And it is a law, so therefore they are 
breaking the law.
    Secretary Sebelius [continuing]. Next year's tax.
    Mrs. Ellmers. OK. You also brought up the issue when you 
were in Kansas, that you fought against discriminatory issues. 
Now, as far as essential health benefits, correct me if I'm 
wrong, do men not have to buy maternity coverage?
    Secretary Sebelius. Policies will cover maternity coverage 
for the young and healthy.
    Mrs. Ellmers. Including men?
    Secretary Sebelius. Under 30 years old will have so a 
choice also of a catastrophic plan which has no maternity 
coverage.
    Mrs. Ellmers. The catastrophic, but men are required to 
purchase maternity.
    Secretary Sebelius. Well, an insurance policy has a series 
of benefits whether you use them or not, and one of the 
benefits will be----
    Mrs. Ellmers. And that is why----
    Secretary Sebelius [continuing]. Coverage for mental health 
coverage----
    Mrs. Ellmers [continuing]. The health care premiums are 
increasing----
    Secretary Sebelius [continuing]. Violence----
    Mrs. Ellmers [continuing]. As high, because we are forcing 
them to buy things that they will never need.
    Thank you, Mr. Chairman.
    Secretary Sebelius. The individual policies cover families. 
Men often do need maternity coverage for their spouses and for 
their families, yes.
    Mrs. Ellmers. Single male age 32 does not need maternity 
coverage. To the best----
    Secretary Sebelius. He may not need----
    Mrs. Ellmers [continuing]. Of your knowledge, has a man 
ever delivered a baby?
    Mr. Upton. Gentlelady's time----
    Secretary Sebelius. I don't think so.
    Mr. Upton [continuing]. Has expired. The gentlelady, Ms. 
Cathy McMorris Rodgers.
    Mrs. McMorris Rodgers. Thank you, Mr. Chairman. And Madam 
Secretary, although we were told repeatedly that if you liked 
your health insurance plan, you'd be able to keep it, we're now 
being told by the government that they have determined many 
existing plans to be lousy, subpar.
    In reality, this law is becoming quickly less about helping 
Americans purchase affordable coverage and more about 
compelling millions of Americans into a struggling Medicaid 
program. In my home State of Washington, 90 percent of 
enrollees will be in Medicaid; 16,000 of them coming into a 
program that they were already eligible for; Colorado, 89 
percent; Kentucky, two-thirds; Maryland, 97 percent. And these 
are States that are already struggling with their budgets, 
wondering how they're going to cover Medicaid, which is, as we 
all know, for the most vulnerable population.
    So isn't it true that in States like Washington, they're 
going to have new, unexpected costs associated with a dramatic 
influx into Medicaid?
    Secretary Sebelius. Well, Congresswoman, the Medicaid 
expansion provision of the Affordable Care Act is----
    Mrs. McMorris Rodgers. Are States going to face new costs--
--
    Secretary Sebelius. The Federal Government pays 100 percent 
of the costs of newly insured for the first 3 years and 
gradually reduces----
    Mrs. McMorris Rodgers. These are existing----
    Secretary Sebelius [continuing]. That cost to 90 percent.
    Mrs. McMorris Rodgers. These were people that were already 
eligible.
    Secretary Sebelius. Well, existing people were----
    Mrs. McMorris Rodgers. And we know that two out of three 
doctors don't accept new Medicaid patients, we know that 
current provider rates are going to drop at the end of 2014. So 
isn't it true that existing Medicaid enrollees are going to 
further compete for scarce resources in these States?
    Secretary Sebelius. If the citizens of Washington who are 
signing up were eligible for Medicaid, they certainly will be 
entitled to enroll in Medicaid now. The newly insured will be--
--
    Mrs. McMorris Rodgers. I'm concerned----
    Secretary Sebelius [continuing]. Fully paid for. The 
doctors have additional fees.
    Mrs. McMorris Rodgers [continuing]. That the most 
vulnerable in this country are going to lack access to the care 
that they they're going to receive. And I know time is short, 
Madam----
    Secretary Sebelius. Well, I think that's absolutely true. 
And in States that are choosing not to expand Medicaid, it's 
particularly dire.
    Mrs. McMorris Rodgers. It's----
    Secretary Sebelius. So I would love to work with you on 
that----
    Mrs. McMorris Rodgers. It's existing Medicaid.
    Secretary Sebelius [continuing]. Expansion.
    Mrs. McMorris Rodgers. And finally, I just wanted to inform 
the Secretary, you told us several hours ago when the hearing 
started that the Web site was down. If you look at the screen, 
several hours later, HealthCare.gov is still down. You promised 
this system would be ready on October 1st. You're clearly 
wrong.
    So before I leave you today, I would just impress upon you, 
this is more than a broken Web site. This is a broken law. 
Millions of Americans are getting notices their plans are being 
canceled. I yield back my time.
    Mr. Upton. Gentle----
    Mr. Waxman. Meh, meh, meh.
    Mr. Upton. Gentlelady's time has expired.
    I would do a couple things here. First I'm going to ask 
unanimous consent that the written opening statements for any 
member on the committee be introduced into the record. And 
without objection, the documents will be there. I also would 
ask unanimous consent to put the document binder and other 
documents presented to the Secretary during questioning into 
the record without objection. So ordered.
    [The information appears at the conclusion of the hearing.]
    Mr. Upton. Let me just say in conclusion, we do look 
forward to having you back in December to get an update on 
where we are, and we'll work with your schedule to find a right 
time and date early that week. I want you to know, we're going 
to want real numbers. You will have them by then, is that 
right, in terms of the signup? You'll have them in the next 
couple of weeks, so----
    Secretary Sebelius. That's correct. We'll have them by mid 
November.
    Mr. Upton. We look forward to getting those done. We 
appreciate, we really do appreciate your time this morning to 
take questions. And I apologize to all the members who we had 
to shorten the time, but those things happen when we have this 
much interest. We look forward to continuing to get an update 
and look for your continued work.
    Mr. Waxman. Mr. Chairman, and----
    Mr. Upton. Yes.
    Mr. Waxman [continuing]. From our side of the aisle, we 
want to work with you. And I would hope on the other side of 
the aisle, they would take that same approach. Let's do 
something constructive, not just negative attacks against a 
bill that I think is going to be a Godsend for millions of 
Americans. Thank you for being here.
    Secretary Sebelius. Thank you.
    Mr. Upton. Thank you. The hearing is adjourned.
    [Whereupon, at 12:40 p.m., the committee was adjourned.]
    [Material submitted for inclusion in the record follows:]

              Prepared statement of Hon. Marsha Blackburn

    For four years, the president told Americans that if they 
like the health insurance plan they have, they can keep it. The 
facts today show this is not the case. Everyday, my office gets 
letters from constituents letting us know they have been thrown 
off their current plan. Adding insult to injury, the Web site 
to buy one of the presidents plans doesn't even work. For those 
that are able to get through, many are finding their premiums 
going up, not down. The botched rollout of this law simply 
confirms everyone's worst fears about government run health 
care. If they government can't figure out how to run a Web 
site, how will they be able to figure out how to take care of 
us. Today we continue our investigation into these issues of 
behalf of all Americans whose lives are affected by this law.

                                #  #  #

                              ----------                              


                 Prepared statement of Hon. Greg Walden

    Thank you, Mr. Chairman and Ranking Member, for holding 
this very important hearing. The fact is that the rollout of 
healthcare.gov has been a failure at every turn. The federal 
exchange still isn't working for millions of Americans who 
visit the Web site trying to enroll. In my home state of 
Oregon, our state run exchange, Cover Oregon, still hasn't even 
gone online. A month after they were supposed to be up and 
running, they have yet to sell even one single private 
insurance policy through the exchange Web site.
    But what's most troubling is that Obamacare isn't just a 
Web site. In fact, the Web site is supposed to be the easy 
part. And now, we're seeing more and more cracks in the 
foundation. This administration promised, in unequivocal terms 
that, ``If you like your doctor, you will be able to keep your 
doctor, period. If you like your health care plan, you'll be 
able to keep your health care plan, period. No one will take it 
away, no matter what.''
    Despite White House rhetoric, millions of Americans are 
receiving cancellation notices in the mail. In Oregon alone, 
150,000 people are losing their insurance plans. Health 
insurance they liked and that their President promised they 
could keep. I've heard from dozens of people living in Oregon's 
Second Congressional District who are now struggling to make 
ends meet because their premiums are doubling, their 
deductibles are going up, and they're getting worse coverage 
for it. It's just another broken promise from the 
administration.
    And the problems don't end there. What's next? What new 
hurdle is about to be thrown in the way of the American people? 
For one, the Affordable Care Act required the Centers for 
Medicare and Medicaid Services (CMS) to rebase home health 
payments. The stated goal was to align payment with costs. The 
law gave CMS the authority to rebase the payments by as much as 
3.5 percent per year from 2014 through 2017. Rather than 
implement these cuts gradually seeing the effect as they go--or 
on a year by year basis, CMS regulations recommend payments be 
rebased by the full 3.5 percent every year for all four years. 
Taken as a whole, these cuts result in a 14 percent cut to 
Medicare home health payments.
    These policies might seem like something done in a vacuum 
to bureaucrats in D.C. But they have significant and lasting 
effects for people living in the real world. My home District 
is 70,000 square miles. We stretch across a distance roughly as 
far as Cincinnati to Baltimore. We're mountainous, we're rural, 
and some counties are without a physician, let alone a 
hospital. For the Oregonians I represent, access to home health 
providers is crucial.
    My family and I have seen first-hand the powerful impact 
that compassionate and highly skilled home health nurses 
provide. We've used it with our own loved ones and know how 
meaningful it is to be able to recover at home, in familiar 
surroundings, with your family by your side. It would be 
devastating for the people in Oregon's Second District--and 
throughout rural America if these services were no longer 
available to them.
    Unfortunately, the Affordable Care Act could limit access 
to home health. CMS's cuts to home health would result in 
negative Medicare margins for home health care providers in 
nearly every single state. Oregon's margins would fall to 
negative 26.5 percent.
    I was one of 142 members of the House who sent a letter to 
Administrator Tavenner expressing our concerns about this very 
issue back in September. To date, we haven't heard back. But 
this issue is not one that is going to go away. As we move from 
one crisis point with the flawed implementation of the 
government takeover of health care to the next, this issue 
will, inevitably, come to the forefront. Too many of our 
nation's seniors and rural residents depend on the 
availability, reliability, and affordability of home health 
care services.
    Thank you again Mr. Chairman and Ranking Member. I look 
forward to hearing what the administration plans to do to 
protect Americans from a fatally flawed law that reduces access 
to health care, increases costs, cuts Medicare, and puts a 
barrier of government red tape between patients and their 
doctors.
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