    [House Hearing, 114 Congress]
    [From the U.S. Government Publishing Office]

               MODERNIZING THE TELEPHONE CONSUMER PROTECTION ACT

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

                                    HEARING

                                   BEFORE THE

                 SUBCOMMITTEE ON COMMUNICATIONS AND TECHNOLOGY

                                     OF THE

                        COMMITTEE ON ENERGY AND COMMERCE
                            HOUSE OF REPRESENTATIVES

                        ONE HUNDRED FOURTEENTH CONGRESS

                                 SECOND SESSION

                                   __________

                               SEPTEMBER 22, 2016

                                   __________

                               Serial No. 114-172

          Printed for the use of the Committee on Energy and Commerce

                            energycommerce.house.gov

                                _________

                    U.S. GOVERNMENT PUBLISHING OFFICE

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                        COMMITTEE ON ENERGY AND COMMERCE

                              FRED UPTON, Michigan
                                     Chairman
    JOE BARTON, Texas                    FRANK PALLONE, Jr., New Jersey
      Chairman Emeritus                    Ranking Member
    JOHN SHIMKUS, Illinois               BOBBY L. RUSH, Illinois
    JOSEPH R. PITTS, Pennsylvania        ANNA G. ESHOO, California
    GREG WALDEN, Oregon                  ELIOT L. ENGEL, New York
    TIM MURPHY, Pennsylvania             GENE GREEN, Texas
    MICHAEL C. BURGESS, Texas            DIANA DeGETTE, Colorado
    MARSHA BLACKBURN, Tennessee          LOIS CAPPS, California
      Vice Chairman                      MICHAEL F. DOYLE, Pennsylvania
    STEVE SCALISE, Louisiana             JANICE D. SCHAKOWSKY, Illinois
    ROBERT E. LATTA, Ohio                G.K. BUTTERFIELD, North Carolina
    CATHY McMORRIS RODGERS, Washington   DORIS O. MATSUI, California
    GREGG HARPER, Mississippi            KATHY CASTOR, Florida
    LEONARD LANCE, New Jersey            JOHN P. SARBANES, Maryland
    BRETT GUTHRIE, Kentucky              JERRY McNERNEY, California
    PETE OLSON, Texas                    PETER WELCH, Vermont
    DAVID B. McKINLEY, West Virginia     BEN RAY LUJAN, New Mexico
    MIKE POMPEO, Kansas                  PAUL TONKO, New York
    ADAM KINZINGER, Illinois             JOHN A. YARMUTH, Kentucky
    H. MORGAN GRIFFITH, Virginia         YVETTE D. CLARKE, New York
    GUS M. BILIRAKIS, Florida            DAVID LOEBSACK, Iowa
    BILL JOHNSON, Missouri               KURT SCHRADER, Oregon
    BILLY LONG, Missouri                 JOSEPH P. KENNEDY, III,
    RENEE L. ELLMERS, North Carolina         Massachusetts
    LARRY BUCSHON, Indiana               TONY CARDENAS, California
    BILL FLORES, Texas
    SUSAN W. BROOKS, Indiana
    MARKWAYNE MULLIN, Oklahoma
    RICHARD HUDSON, North Carolina
    CHRIS COLLINS, New York
    KEVIN CRAMER, North Dakota

                 Subcommittee on Communications and Technology

                              GREG WALDEN, Oregon
                                     Chairman
    ROBERT E. LATTA, Ohio                ANNA G. ESHOO, California
      Vice Chairman                        Ranking Member
    JOHN SHIMKUS, Illinois               MICHAEL F. DOYLE, Pennsylvania
    MARSHA BLACKBURN, Tennessee          PETER WELCH, Vermont
    STEVE SCALISE, Louisiana             JOHN A. YARMUTH, Kentucky
    LEONARD LANCE, New Jersey            YVETTE D. CLARKE, New York
    BRETT GUTHRIE, Kentucky              DAVID LOEBSACK, Iowa
    PETE OLSON, Texas                    BOBBY L. RUSH, Illinois
    MIKE POMPEO, Kansas                  DIANA DeGETTE, Colorado
    ADAM KINZINGER, Illinois             G.K. BUTTERFIELD, North Carolina
    GUS M. BILIRAKIS, Florida            DORIS O. MATSUI, California
    BILL JOHNSON, Missouri               JERRY McNERNEY, California
    BILLY LONG, Missouri                 BEN RAY LUJAN, New Mexico
    RENEE L. ELLMERS, North Carolina     FRANK PALLONE, Jr., New Jersey (ex
    CHRIS COLLINS, New York                  officio)
    KEVIN CRAMER, North Dakota
    JOE BARTON, Texas
    FRED UPTON, Michigan (ex officio)

                                 C O N T E N T S

                                  ----------
                                                                       Page
    Hon. Greg Walden, a Representative in Congress from the State of
      Oregon, opening statement......................................     1
        Prepared statement...........................................     3
    Hon. Anna G. Eshoo, a Representative in Congress from the State
      of California, opening statement...............................     4
    Hon. Frank Pallone, Jr., a Representative in Congress from the
      State of New Jersey, opening statement.........................     6
    Hon. Fred Upton, a Representative in Congress from the State of
      Michigan, prepared statement...................................    60

                                   Witnesses

    Michelle Turano, Vice President, Public Policy and Government
      Affairs, Wellcare Health Plans.................................     8
        Prepared statement...........................................    11
        Answers to submitted questions...............................   112
    Shaun Mock, Chief Financial Officer, Snapping Shoals Electric
      Membership Corporation.........................................    19
        Prepared statement...........................................    21
        Answers to submitted questions...............................   116
    Spencer Weber Waller, Professor and Director, Institute for
      Consumer Antitrust Studies, Loyola University Chicago..........    29
        Prepared statement...........................................    31
        Answers to submitted questions...............................   122
    Richard Shockey, Principal, Shockey Consulting...................    35
        Prepared statement...........................................    36
        Answers to submitted questions...............................   127

                               Submitted Material

    Statement of Indiana Attorney General Greg Zoeller, submitted by
      Mr. Walden.....................................................    62
    Statement of the National Association of Federal Credit Unions,
      submitted by Mr. Walden........................................    64
    Statement of several non-profit consumer groups, submitted by Ms.
      Eshoo..........................................................    74
    Statement of several banking associations, submitted by Mr.
      Walden.........................................................
    Article entitled, ``The Telephone Consumer Protection Act of
      1991: Adapting Consumer Protection to Changing Technology,''
      Loyola Consumer Law Review, 2014, submitted by Mr. Walden \1\..    62
    Statement of the Electronic Privacy Information Center, submitted
      by Ms. Eshoo...................................................    89
    Statement of America's Health Insurance Plans, submitted by Mr.
      Latta..........................................................    93
    Statement of the Credit Union National Association, submitted by
      Mr. Latta......................................................   107

    ----------
    \1\ Available at: http://docs.house.gov/meetings/IF/IF16/
      20160922/105351/HHRG-114-IF16-20160922-SD008.pdf.

               MODERNIZING THE TELEPHONE CONSUMER PROTECTION ACT

                                  ----------

                               SEPTEMBER 22, 2016

                      House of Representatives,
         Subcommittee on Communications and Technology,
                              Committee on Energy and Commerce,
                                                        Washington, DC.
        The subcommittee met, pursuant to call, at 11:00 a.m., room
    2322, Rayburn House Office Building, Hon. Greg Walden (chairman
    of the subcommittee) presiding.
        Present: Representatives Walden, Latta, Shimkus, Blackburn,
    Lance, Guthrie, Pompeo, Bilirakis, Long, Collins, Eshoo, Doyle,
    Welch, Clarke, McNerney, and Pallone (ex officio).
        Also Present: Representative Schakowsky.
        Staff Present: Rebecca Card, Assistant Press Secretary;
    Gene Fullano, Detailee, Telecom; Kelsey Guyselman, Counsel,
    Telecom; Grace Koh, Counsel, Telecom; David Redl, Chief
    Counsel, Telecom; Charlotte Savercool, Professional Staff,
    Communications and Technology; Dan Schneider, Press Secretary;
    Gregory Watson, Legislative Clerk, Communications and
    Technology; Jeff Carroll, Minority Staff Director; David
    Goldman, Minority Chief Counsel, Communications and Technology;
    Elizabeth Letter, Minority Professional Staff Member; Jerry
    Leverich, Minority Counsel; Lori Maarjberg, Minority FCC
    Detailee; Dan Miller, Minority Staff Assistant; Matt
    Schumacher, Minority Press Assistant; and Andrew Souvall,
    Minority Director of Communications, Outreach and Member
    Services.

      OPENING STATEMENT OF HON. GREG WALDEN, A REPRESENTATIVE IN
                   CONGRESS FROM THE STATE OF OREGON

        Mr. Walden. We will call to order the subcommittee on
    Communications and Technology and welcome our witnesses here
    today. We look forward to your participation in this hearing.
        We are here today to talk about modernizing the Telephone
    Consumer Protection laws. As you all know, it has been 25
    years, 25 years, quarter of a century since Congress passed the
    Telephone Consumer Protection Act. And I don't have to tell you
    the world has changed pretty dramatically in that time period.
    Back in '91, virtually everybody had a landline, and that is
    what they used to call each other on. Today, half of U.S.
    households or thereabouts have become wireless-only,
    eliminating their landline phones entirely. And there are more
    cell phones than people in the United States.
        Current law is not reflective of these incredible
    technological changes in our culture. Despite an extraordinary
    number of lawsuits over the years, calls and texts from bad
    actors continue to happen. Clearly, this approach isn't a
    deterrent to those who place harassing, malicious calls. We all
    share the goal of preventing harmful phone calls, but it is
    increasingly clear that the law is outdated and, in many cases,
    counterproductive. We will hear about that today from our
    witnesses.
        The attempts to strengthen the TCPA rules have actually
    resulted in a decline in legitimate informational calls that
    consumers want and need. The FCC has granted narrow exceptions
    to specific industries in attempts to clear up ongoing
    uncertainty, but the number of petitions still pending before
    the Commission demonstrate that it is time to examine how
    effective this approach has been.
        Industries across the board have real needs to communicate
    with their customers in a positive and beneficial way, and
    today we will hear from those whose daily operations have been
    impacted by this 25-year-old law. We have a public utility co-
    op from Georgia that needs to inform their customers of
    neighborhood tree maintenance, for example, and ways to reduce
    their energy footprint during peak energy consumption periods.
        We will also hear from a managed health care provider that
    is seeking clarification to be able to provide critical
    information to patients to help lower the cost of their health
    care. And these folks, like many others, struggle with how to
    serve the needs of the consumers and the economy with the lack
    of clarity in the current law.
        I heard from a staffing company that operates in Oregon and
    in my district that connects blue-collar workers to temporary,
    short-term job opportunities. It used to be these workers would
    have to sit around the waiting room all day waiting to hear if
    a job that met their skill set was available. The company
    figured a way to use technology to improve the lives of these
    people, the company instead used text messages to communicate
    with workers when a job that matched their skill set is
    available. That gave the people looking for the jobs the
    opportunity to continue with the rest of their lives rather
    than sitting around a waiting room, while still finding the
    chance to work, which sounds great and efficient and kind of
    the modernization of the workplace we all expect today.
        Unfortunately, the 25-year-old law, TCPA, they were smacked
    with a lawsuit for their efforts. For a business like this, a
    massive class-action lawsuit could actually mean bankruptcy.
        So I think we can all agree there is a big difference
    between the call fraudulently purporting to be the IRS and a
    legitimate reminder from the doctor's office of an upcoming
    appointment or a job agency of a temporary job now available.
    This is the critical distinction we need to recognize in order
    to strike the correct balance.
        How can we protect consumers from the harassing, spoofed
    calls they do not want to receive--none of us do--while at the
    same time ensuring they do receive the legitimate calls that
    improve quality of life? What are the solutions out there that
    can be used to determine the differences, and are there changes
    to the law that would actually help consumers?
        I want to thank my Democratic colleagues for requesting
    this hearing and all of our members for the commitment to a
    productive conversation about taking a look at a 25-year-old
    law.
        Just yesterday, the full committee passed the Anti-Spoofing
    Act in a bipartisan manner, legislation prohibits bad actors
    from deliberately manipulating a text message number for
    illegal purposes. Spoofing is a major component of the robocall
    problem, but just one piece of this complicated puzzle. There
    is no silver bullet here to solve the problem of unwanted
    calls, but if there are legislative changes that will protect
    our constituents, we owe it to them to make every effort to
    mitigate the problem. So I hope the momentum from our
    accomplishments yesterday can carry on to our efforts today to
    work toward the shared goal of protecting consumers from
    illegal phone calls.
        We have a unique set of perspectives here today that I hope
    will guide us through a productive discussion. From a professor
    who has studied the law extensively, to a couple of businesses
    concerned about violating the law while trying to providing
    their services, and those who have been developing technical
    solutions to these issues at stake; this hearing should set the
    stage for a constructive consideration about protecting
    consumers in this new technological era.
        So I thank our witnesses for being here and our members and
    look forward to the discussion we are going to have today.
        [The prepared statement of Mr. Walden follows:]

                     Prepared statement of Hon. Greg Walden

        We are here today to talk about modernizing the telephone
    consumer protection laws. It has been 25 years since Congress
    passed the Telephone Consumer Protection Act, and the world has
    changed dramatically since then. When the law was signed back
    in 1991, consumers relied primarily on landline phones to
    communicate, but today almost half of U.S. households have
    become ``wireless-only,'' eliminating their landline phones
    entirely, and there are more cell phones than people in the US.
        The current law is not reflective of these technological
    advances. Despite an extraordinary number of lawsuits over the
    years, calls and texts from bad actors continue to happen-
    clearly this approach isn't a deterrent to those who place
    harassing, malicious calls. We all share the goal of preventing
    harmful phone calls, but it is increasingly clear that the law
    is outdated and in many cases, counter-productive. The attempts
    to strengthen the TCPA rules have actually resulted in a
    decline in legitimate, informational calls that consumers want.
    The FCC has granted narrow exceptions to specific industries in
    attempts to clear up ongoing uncertainty, but the number of
    petitions still pending before the Commission demonstrate that
    it's time to examine how effective this approach has been.
        Industries across the board have real needs to communicate
    with their customers in a positive and beneficial way, and
    today we'll hear from those whose daily operations have been
    impacted by the TCPA. We have a public utility co-op from
    Georgia that needs to inform their customers of neighborhood
    tree maintenance and ways to reduce their energy footprint
    during peak energy consumption periods. We'll also hear from a
    managed healthcare provider that is seeking clarification to be
    able to provide critical information to patients to help lower
    the cost of health care. These folks, like many others,
    struggle with how to serve the needs of their customers and the
    economy with the lack of clarity in the law.
        I heard from a staffing company that operates in my
    district that connects blue-collar workers to temporary, short-
    term job opportunites. It used to be that those workers would
    have to sit around the waiting room of a staffing agency all
    day, waiting for a job to come up, or not. Thanks to
    technological advances, this company instead uses text messages
    to communicate with workers when a job that matches their skill
    set is available, giving the workers the opportunity to
    continue with their lives while still having the chance to find
    work. Sounds great, right? Unfortunately, thanks to the TCPA,
    they were smacked with a lawsuit for their efforts. For a
    business like this, a massive class-action lawsuit could mean
    bankruptcy.
        I think we can all agree that there is a big difference
    between the call fraudulently purporting to be the IRS and the
    legitimate reminder from the doctor's office of an upcoming
    appointment. This is the critical distinction we need to
    recognize in order to strike the right balance. How can we
    protect consumers from the harassing, spoofed calls they do not
    want to receive, while at the same time ensuring that they do
    receive the legitimate calls that improve their quality of
    life? What are the solutions out there that can be used to
    determine the difference and are there changes to the law
    needed to bring them to consumers?
        I want to thank my colleagues on the Democratic side for
    requesting this hearing and for all of our members for the
    commitment to a productive conversation about modernizing an
    outdated law. Just yesterday, the full committee passed the
    Anti-Spoofing Act in a bipartisan manner, legislation that
    prohibits bad actors from deliberately manipulating a text
    message number for illegal purposes. Spoofing is a major
    component of the robo-call problem, but just one piece of this
    complicated puzzle. There is no silver bullet to solve the
    problem of unwanted calls, but if there are legislative changes
    that will protect our constituents, we owe it to them to make
    every effort to mitigate the problem. I hope the momentum from
    our accomplishment yesterday can carry on through our efforts
    today to work towards the shared goal of protecting consumers
    from illegal phone calls.
        We have a unique set of perspectives here today that I hope
    will guide us through a productive discussion. From a professor
    who has studied the law extensively, to businesses concerned
    about violating the law while providing their services, and
    those who have been developing technical solutions to these
    issues at stake; this hearing should set the stage for a
    constructive consideration of protecting consumers in a new
    technological era. I thank all of our witnesses for being here
    and I look forward to hearing your testimony.

        Mr. Walden. And I will yield back the remaining 3 seconds
    of my time and recognize my friend from California, Ms. Eshoo,
    for her opening comments.
        Ms. Eshoo. Thank you, Mr. Chairman----
        Mr. Walden. But before I do, could I ask unanimous consent
    to insert into the record a letter from the Indiana Attorney
    General Greg Zoeller, a letter from the National Association of
    Federal Credit Unions, a letter signed by several consumer
    groups, a statement from several banking associations, along
    with the very, very distinguished paper from our professor
    today and from 2014, the Telephone Consumer Protection Act of
    1991: Adapting Consumer Protection to Changing Technology. \1\
    Without objection, we will enter those into the record.
        [The information appears at the conclusion of the hearing.]
    ---------------------------------------------------------------------------
        \1\ The information has been retained in committee files and is
    also available at: http://docs.house.gov/meetings/IF/IF16/20160922/
    105351/HHRG-114-IF16-20160922-SD008.pdf.
    ---------------------------------------------------------------------------
        Mr. Walden. Now, I recognize my friend from California.

     OPENING STATEMENT OF HON. ANNA G. ESHOO, A REPRESENTATIVE IN
                 CONGRESS FROM THE STATE OF CALIFORNIA

        Ms. Eshoo. Thank you, Mr. Chairman. Good morning, everyone.
    Welcome to the witnesses.
        There is one issue that I hear consistently about from my
    constituents, and that is the need to put an end to unwanted
    phone calls. Whether I am in the grocery store--now, I am going
    grocery shopping late at night so that I can just get it done
    quickly because, people see me, recognize me, and this is what
    they come up to me to talk about. And they are 40,000 feet and
    climbing over it. Their sleep is interrupted. The day doesn't
    belong to them. It is a consistent form of harassment the way
    they view it. For many seniors, there are many scams, and they
    are susceptible to them.
        So this barrage of unwanted calls using auto-dialers and
    prerecorded messages, they are disruptive to say the least and
    they really are intrusive. And I can speak for myself when I
    get them because I consider my home my oasis, and I can't stand
    hearing from these people.
        Now, how bad is the problem? Obviously, from what I have
    said, it is pretty bad. And estimates have found that robocalls
    make up nearly 35 percent of calls that consumers receive
    today. And it keeps climbing. The robocall blocking service
    YouMail tracked the number of robocalls made last month, August
    of this year alone, and found that there were 2.64 billion with
    a B. We usually talk about dollars with a B, these calls. That
    is a 9 percent increase over the previous month of July of this
    year. And that is just one month's worth of robocalls, so it is
    no wonder that these kinds of calls are the number-one source
    of consumer complaints at the FCC.
        Now, Congress sought to address this 25 years ago, a
    quarter of a century ago, by passing the Telephone Consumer
    Protection Act, the TCPA. At that time the law put important
    protections in place to restrict the use of technology used to
    place robocalls. We took other steps to crack down on unwanted
    calls, including the passing of the Do Not Call list. That
    worked for a long time. People were really thrilled with it.
    And I was proud to be a cosponsor of that effort. So the TCPA
    was, for a long time, an effective way to limit the number of
    unwanted calls.
        Now, the FCC, I think, has done its best to implement the
    law in a way that keeps pace with today's practices. But the
    law, along with the technologies that were embedded in it or
    referred to, have aged in plenty of ways. And it is up to us
    and I think it is very clear to us that it is time to start
    thinking about how we can update the TCPA to better protect
    consumers. And it is exactly why Ranking Member Pallone,
    Congresswoman Jan Schakowsky, and I called for a hearing on
    this. And thank you, Mr. Chairman, all our thanks on behalf of
    our constituents that we are doing this today.
        Now, there are a number of issues for us to consider as we
    examine the TCPA. For instance, does the FCC and the FTC have
    the tools they need to effectively enforce the law? Well, we
    are going to examine that. Are intentional violations
    sufficiently punished under the current structure of the law?
    We have come to a time and a place in our country where people
    break the law and then they settle with the regulators, and no
    one is punished really for anything. And that is a great source
    of frustration to people, and I don't think it is fair. How do
    we target calls from overseas? This is a big thing because so
    much is coming from overseas that can result in fraud.
        So I look forward to hearing from the witnesses.
        And I think one thing Congress should not be doing is
    passing more exemptions to the TCPA. The 2015 Budget Act
    contains an exemption allowing robocalls for Federal debt
    collection, including calls to cell phones. So I am glad that
    the FCC put some limits on that exemption, but the fact remains
    that we still--and our constituents most importantly, people
    across the country--are asking us for more protection, not more
    loopholes. And I think we have to keep our eye on that ball,
    too, Mr. Chairman.
        So, again, thank you for holding this hearing today, and I
    look forward to hearing from today's witnesses and some solid
    suggestions about how we can actually update the TCPA to
    eliminate these issues that are plaguing all of our
    constituents.
        Thank you, and I yield--I have no time to yield back. Thank
    you.
        Mr. Walden. The gentlelady yields back.
        The chair recognizes the vice chair of the subcommittee,
    Mr. Latta.
        Mr. Latta. Well, thank you, Mr. Chairman, and thanks for
    holding today's hearing. The Telephone Consumer Protection Act
    is clearly outdated and needs to be reformed to accommodate
    current technological challenges. It is not reasonable to
    govern communications based off technology available in 1991.
    While it is essential we continue to protect consumer privacy,
    we must find the right balance between consumer rights and
    expectations and allowing institutions to provide information
    to their customers.
        Additionally, we must recognize the importance of
    distinguishing the content of communications on modernizing
    this act. Our goals should be to deter the bad actors and not
    punish businesses and organizations with the best of
    intentions.
        The FTC has attempted to modernize the TCPA. However, these
    reforms have not necessarily made the law better and it still
    remains far from perfect. In fact, the broad interpretation of
    the FTC's definition of auto-dialer is concerning as it creates
    greater uncertainty for consumers and companies.
        Today's hearing will provide robust conversation and ideas
    on how to best update the TCPA, and consumers' privacy needs to
    be protected and businesses need an avenue to inform and
    communicate with their customers.
        And with that, Mr. Chairman, I yield back.
        Mr. Walden. The gentleman yields back.
        Any others seeking time?
        Then we will go to Mr. Pallone, the ranking member of the
    full committee, for opening comments.

    OPENING STATEMENT OF HON. FRANK PALLONE, JR., A REPRESENTATIVE
                IN CONGRESS FROM THE STATE OF NEW JERSEY

        Mr. Pallone. Thank you.
        If you think you are getting more robocalls than ever, you
    are probably right. Just this past month, a record 2.6 billion
    robocalls flooded our cell phones, work phones, and home
    phones. And these calls are more than just a nuisance; they can
    add up to harassment or even outright fraud.
        When Congress first passed the Telephone Consumer
    Protection Act 25 years ago, we stated that consumers were
    already ``outraged over the proliferation of intrusive nuisance
    calls their homes.'' Back then, we sought to balance individual
    privacy rights, public safety interests, and commercial
    freedoms of speech and trade. And for a time, the law worked.
        Unfortunately, a little over a decade later, these nuisance
    calls were on the rise again, but this time the calls did not
    only cause a nuisance, many of them sought to defraud
    consumers. According to the FTC, consumer complaints of
    unwanted telemarketing calls increased over 1,000 percent
    between '98 and 2002. Congress stepped in once more to stop
    this dramatic surge in calls, and we required the FTC to create
    a Do Not Call Registry, among other things, again turning back
    the tide of unwanted calls.
        But almost like clockwork, however, nuisance calls were
    rebounding again nearly a decade later. Robocalls were finding
    new ways to circumvent the system, and the law simply wasn't
    keeping up.
        The FCC tried to reduce these robocalls, but they keep
    coming. By 2012, the FCC was receiving an average of over
    10,000 complaints per month from mobile phones alone, and that
    number has only continued to grow to a point where last year,
    the FCC received more than 170,000 robocall and telemarketing
    complaints.
        So last month, the FCC convened a new Robocall Strike Force
    hoping to leverage the industry in the FCC's ongoing effort,
    and I commend the Commission for working so diligently to
    address this issue. But the fact that the FCC's actions are not
    reducing the number of robocalls demonstrates that it is time
    for Congress to once again step in.
        So I urge the strike force to continue to look for
    technical and regulatory solutions to this problem, but
    Congress has a role as well. So that is why I joined Ranking
    Member Eshoo and Schakowsky last month in asking that the
    committee hold a hearing on updating the TCPA. Our constituents
    are rightfully growing impatient with these calls, and they
    expect us to fix the problem.
        And I appreciate that Chairman Walden agreed to our request
    for this hearing, and I also want to thank the phone carriers
    for offering to work with us to address this problem. It is not
    a moment too soon, and we all need to work together to solve
    it.
        Now, we acted to protect consumers in '91 and 2003. Now, 13
    years later, we should again put the FTC and the FCC back on
    firm footing so they can step up to protect consumers from
    these annoying and so often dangerous called.
        And again, I want to thank our witnesses, and I yield the
    balance of my time to Ms. Schakowsky.
        Ms. Schakowsky. I am so grateful for the opportunity to
    join you today. I thank Ranking Member Pallone for yielding
    time to me.
        As has been mentioned, last month, I joined Ranking Members
    Eshoo and Pallone to request a hearing on updating the
    Telephone Consumer Protection Act for the 21st century. This
    year marks the 25th anniversary of TCPA. Congress has made some
    updates over that time such as the Do Not Call Registry, but
    the law is beginning to show its age.
        Consumer complaints about unwanted calls are on the rise. I
    think Ranking Member Eshoo really described what all of us are
    hearing. I have heard from many constituents in recent months
    trying to stop robocalls. I have received many on my cell
    phone. We need to close loopholes and improve enforcement
    tools.
        My Democratic colleagues and I have introduced many bills
    to protect consumers as they use their phones. For instance, I
    introduced the Protect Consumers from Phony Pay Charges Act in
    June to stop telephone companies from including unauthorized
    charges on phone bills. Until we act on such improvements, we
    are going to continue to see family meals disrupted, fraudsters
    exploiting seniors, consumers subjected to unwanted charges.
    And it is time to reform TCPA.
        I am going to apologize that I have to leave in a moment
    because the Consumer, Manufacturing, and Trade Subcommittee, on
    which I am the ranking Democrat, is also having its hearing
    right now. But that said, I hope this is just the beginning of
    this discussion and that we will have the opportunity for joint
    hearings with this subcommittee and the CMT in the future.
        The Federal Trade Commission and Federal Communications
    Commission frequently work together on these issues and the
    subcommittees with jurisdiction over those agencies should as
    well.
        So I thank the opportunity to be here this morning, and I
    yield back.
        Mr. Walden. All time has been consumed. I will now go to
    our witness panel. And again, thank you all for being here this
    morning.
        And our first witness is Michelle Turano--we appreciate you
    being here--Vice President, Government Affairs and Public
    Policy for WellCare. Good morning.
        Ms. Turano. Good morning.
        Mr. Walden. Pull that microphone fairly close. Make sure
    the light is on on the base there, and you are good to go.

     STATEMENTS OF MICHELLE TURANO, VICE PRESIDENT, PUBLIC POLICY
      AND GOVERNMENT AFFAIRS, WELLCARE HEALTH PLANS; SHAUN MOCK,
     CHIEF FINANCIAL OFFICER, SNAPPING SHOALS ELECTRIC MEMBERSHIP
      CORPORATION; SPENCER WEBER WALLER, PROFESSOR AND DIRECTOR,
      INSTITUTE FOR CONSUMER ANTITRUST STUDIES, LOYOLA UNIVERSITY
      CHICAGO; AND RICHARD SHOCKEY, PRINCIPAL, SHOCKEY CONSULTING

                      STATEMENT OF MICHELLE TURANO

        Ms. Turano. Thank you. Mr. Chairman, Representative Eshoo,
    Ranking Member Pallone, members of the committee, I am Michelle
    Turano, vice president of Public Policy and Government Affairs
    for WellCare Health Plans. Thank you for your invitation to
    appear today.
        We fundamentally agree with the premise of this hearing
    that we need to minimize nuisance and unsolicited phone calls
    while ensuring laws and regulations keep pace with the
    evolution of telecommunications technology. We also share the
    goal of maintaining privacy, consistent with strict Federal
    standards such as under the Health Insurance Portability and
    Accountability Act, or HIPAA.
        Let me begin by telling you a little bit about WellCare.
    Headquartered in Tampa, Florida, WellCare focuses exclusively
    on providing government-sponsored managed health care through
    Medicare Advantage, Medicaid, and Medicare prescription drug
    plans to families, children, seniors, and individuals with
    complex medical needs.
        Our members tend to be vulnerable older or disabled
    Americans with limited access to resources who are often
    transitory and rely heavily on cell phones versus a dedicated
    landline, which underscores the need for laws and regulations
    to be updated to reflect cell phone use.
        I would like to be clear. Our communications with these
    members is for the purpose of sharing health care information,
    not for sales and not for marketing. WellCare has statutory and
    contractual mandates from Federal and State governments to
    serve our members. Communication with our members to coordinate
    and assist with care often requires the use of a cell phone. In
    many cases, we receive an enrollee's contact information via
    the State or Federal Government.
        Beneficiaries can be randomly assigned to WellCare and
    might not apply to us directly. Sometimes we have no way of
    verifying if the number provided to us is a cell phone or a
    landline, yet we are still required to contact them.
        State Medicaid contracts require WellCare to make telephone
    contact with members for health-related purposes. For example,
    Florida requires outreach to enrollees within 30 days to
    complete a health risk assessment. Georgia requires outreach to
    parents with newborns within 7 days to inform them of certain
    health services. These are not marketing calls but are directly
    tied to providing critical care to our members and making the
    best and most efficient use of taxpayer dollars.
        The uncertainty surrounding the FCC's interpretation of the
    TCPA has had a chilling effect on the ability of WellCare and
    other managed health care plans to conduct this kind of
    outreach to members. This adds cost while reducing efficiency
    and negatively affects the health of our members.
        While the TCPA serves an important privacy-enhancing
    purpose, the FCC's interpretation does not acknowledge that
    there is comprehensive regulation of the use of protected
    health information by HIPAA that governs not only treatment,
    payment, and health care operations messages but severely
    restricts marketing communications.
        Recent interpretations of the TCPA could be read to provide
    that companies like WellCare cannot conduct automated outreach
    to a cell phone to deliver a health care message unless the
    calling party can also prove prior express consent, a
    requirement that the HIPAA privacy rule expressly does not
    require. These are the exact same phone calls that health care
    providers like doctors and pharmacies can make today. But the
    FCC has excluded managed health care firms from making these
    same sorts of calls.
        WellCare and others recently petitioned the FCC seeking
    clarification around the use of member telephone numbers under
    the TCPA compared to the use of the same information under
    HIPAA. In doing so, we are hoping the Commission will protect
    non-telemarketing calls allowed under TCPA in light of their
    unique value to and acceptance by consumers and do so in an
    expedited manner.
        Legislatively, it would be helpful if Congress could
    clarify that the provision of a phone number to a HIPAA-covered
    entity or business associate constitutes prior express consent
    for health care communications to that number. The TCPA's
    protection of a consumer's right to control unwanted calls
    would still be respected by allowing the consumer to revoke
    that consent at any time.
        In closing, I want to reiterate that the health and well-
    being of our enrollees is WellCare's top priority. We need to
    work together and we look forward to working together with this
    committee and Congress on modernizing the TCPA.
        Thank you for your invitation to testify, and I look
    forward to answering your questions.
        [The prepared statement of Michelle Turano follows:]

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Mr. Walden. Thank you, Ms. Turano. That was very helpful
    testimony as we look at this law and the consequences out in
    the real world.
        We will go now to Mr. Shaun Mock, who is chief financial
    officer of the Snapping Shoals Electric Membership Corporation.
        Mr. Mock, welcome. Thanks for being here. We look forward
    to your counsel.

                        STATEMENT OF SHAUN MOCK

        Mr. Mock. Thank you for the opportunity to address this
    committee regarding the impacts of the Telephone Consumer
    Protection Act on my electric cooperative, Snapping Shoals EMC.
    We are a nonprofit, consumer-owned co-op headquartered in
    Covington, Georgia, where we provide electric service to about
    97,000 mostly residential members southeast of Atlanta.
        Snapping Shoals has a proud tradition of member service and
    innovation. We constantly strive to improve our services not
    because of earnings targets but rather to improve the lives of
    our members.
        Our members of the 21st century expect and demand
    uninterrupted electric service, along with a host of modern
    communication tools. In recent years, our ability to
    communicate with our members has been stymied by the
    uncertainty surrounding existing TCPA regulations. Like most
    complicated matters, the existing regulations are neither all
    good nor all bad.
        We are absolutely in favor of protecting our members from
    unwanted communication. However, we are also in favor of
    removing undue liability found within the confines of the
    existing regulation. Our industry welcomed recent FCC rulings
    when the Commission recognized the importance of timely utility
    notifications. However, these orders did not go far enough in
    patching up the increasingly archaic regulations associated
    with existing law.
        Beginning in 2010, Snapping Shoals offered a prepaid
    electric program that now serves over 11,000 residential
    members. This program allows members to take control of their
    electricity usage much the same pay-as-you-go manner as fueling
    up the family car. In addition, there are no up-front deposits
    and no disconnect or reconnect fees.
        Upon consent, members are provided with low-balance and
    disconnect notifications. Most members establish a default low
    balance, which becomes the notification threshold once active.
    Timely information is vital to providing these members with a
    member-friendly program.
        Since launching the program, we have learned that our
    prepaid membership needs are very different than traditional
    members. We have found that not only does the typical prepaid
    member use less electricity but will also paid towards their
    electric balance at least five times each month.
        In short, prepaid members are more engaged with our co-op
    on a daily basis and require more up-to-date information than
    traditional members. We have found that our low-income
    populations are more likely to choose our prepaid billing
    option. This fact is especially relevant when we consider that
    liability concerns over current TCPA regulations prompted
    Snapping Shoals to discontinue all automated telephone
    notifications in June 2014.
        In late 2013, Snapping Shoals faced legal action alleging
    improper unsolicited phone calls under the strict liability
    portion of the TCPA statute. Although the case has since been
    resolved, Snapping Shoals made substantial negative changes to
    our member notification offerings as a result of this
    complaint.
        The mobile number at issue was provided by a prepaid member
    upon establishing service. The member provided consent and
    verified the phone number at least seven times through a series
    of member-initiated phone calls. Without our knowledge,
    sometime in late 2011, our member changed phone numbers but
    continued to receive electric service at the original address
    while also receiving almost daily email and phone low-balance
    notifications until disconnecting service in April of 2013.
    Daily notifications sound excessive but reflects the member's
    practice of paying small amounts, often daily, to maintain the
    lowest balance possible.
        Unfortunately, our original automated phone system did not
    allow for the member to simply opt out from within the phone
    call. Our automated systems were in their infancy, and we
    acknowledged that these systems should be improved and have
    continued to work with our service providers to develop a more
    robust member solution.
        The prepaid billion program at Snapping Shoals was
    certainly not the first within our industry, but the rapid
    growth of our program meant that we would be one of the first
    to experience the growing pains associated with reassigned
    phone numbers. At best, the FCC has offered a patchwork of best
    practices intended to protect members and reduce liability
    concerns. However, the strict liability provisions within the
    statute leave no room for reasonable application of the law
    that would reflect the modernization of communication.
        By June of 2014, our co-op reluctantly made the unpopular
    decision to discontinue all automated phone notices. Every
    attempt was made to notify our members of the change in hopes
    of avoiding any unnecessary service interruptions. Despite our
    best efforts, we still receive numerous complaints from angry
    members that had grown to depend on these phone notifications.
        The only remaining channel to safely and effectively
    communicate with our members is through email. Unfortunately,
    e-mail-only notifications can exclude a large portion of our
    membership who do not have Internet-connected devices or
    reliable Internet service. We need help from Congress and the
    FCC to mitigate concerns over costly and burdensome TCPA
    litigation for businesses like Snapping Shoals EMC.
        This hearing is a great first step, and I look forward to
    taking your questions today and working with you to improve the
    TCPA moving forward.
        [The prepared statement of Shaun Mock follows:]

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Mr. Walden. Thank you, Mr. Mock. We appreciate the
    testimony, and sorry for what you all have gone through as a
    result of current status of this law.
        We will go now to Mr. Spencer Waller, interim associate
    dean for Academic Affairs and professor at Loyola University
    Chicago and director of the Institute for Consumer Antitrust
    Studies.
        Mr. Waller, thank you for being here. We look forward to
    your testimony.

                   STATEMENT OF SPENCER WEBER WALLER

        Mr. Waller. Thank you very much. Chairman Walden, Ranking
    Member Eshoo, and other members of the subcommittee, I
    appreciate the chance to be here today and discuss with you the
    important issues raised regarding the continued effectiveness
    of the TCPA and appropriate proposals for its reform. I thank
    you for also including our 2014 study of the TCPA in the record
    of these hearings.
        The only thing I would emphasize is that I am here in my
    individual academic capacity and that our institute is
    nonpartisan. We don't take positions in individual cases.
        As I said, my comments are drawn from that 2014 study, and
    as the committee is aware, in the late 1980s, spurred by
    advances in technology, the telemarketing industry began to
    aggressively seek out consumers by the hundreds of thousands.
    They were able to do so as a result of then-technological
    advances involving robocalls, prerecorded messages, automatic
    dialing, and the development of what was then the fax machine.
        Consumers and businesses became overwhelmed with
    unsolicited telemarketing calls and fax advertisements. Calls
    for action grew louder. States enacted laws but could not reach
    the interstate aspects and international aspects of
    telemarketing. And after reviewing and debating 10 different
    pieces of legislation, Congress ultimately enacted the TCPA
    that we are here to talk about.
         And the TCPA was borne out of abusive telemarketing
    practices, made more invasive by the technology of that time.
    And since 1991, Congress has enacted other statutes relevant to
    the discussion of the TCPA, some of which have already been
    mentioned today.
        The original purpose of the TCPA was to regulate certain
    uses of technology that were abusive, invasive, and potentially
    dangerous and also to some extent cost-shifting to the
    consumers. And the TCPA effectively regulates those abuses by
    prohibiting certain technologies altogether, rather than
    focusing specifically on the content of the messages being
    delivered.
        And the expansion of the TCPA into areas outside of
    marketing and new technologies such as text messaging and cell
    phones over the years is consistent with its original purpose.
        On the enforcement side under the current scheme, private
    parties are largely responsible for the TCPA and have done so
    primarily through the class-action mechanism. This is in part
    due to the small statutory damages for any single plaintiff
    under the TCPA and the lack of statutory attorneys fees except
    through the class-action mechanism.
        And while this aspect of private enforcement has drawn some
    criticism because of the potential for large total damages
    faced by certain defendants, the threat of class actions has
    also provided significant direct and indirect deterrence to
    violators and is the only meaningful source of potential
    compensation to victims of TCPA violations.
        Historically, the Federal Government, through the FCC, has
    only enforced the TCPA directly against violators to a limited
    extent, and yet the statute has been relatively successful in
    reducing the conduct it was enacted to regulate.
        Obviously, technology continues to evolve rapidly, and
    there are a number of trends that are emerging. The number of
    entities that are operating in intentional disregard of the
    TCPA are growing, and they are using more sophisticated
    technology to evade detection and enforcement.
        According to the Federal Trade Commission, about 59 percent
    of phone spam cannot be traced or blocked because the calls are
    routed through ``a web of automatic dialers, caller ID
    spoofing, and voiceover-Internet protocols.''
        Although the traditional scheme of TCPA enforcement, with
    its strong reliance on private rights of action, has been
    successful in the past, two main issues are becoming clear. The
    private right of action is limited in terms of its ability to
    deter actions of intentional violators, and FCC direct
    enforcement through forfeiture proceedings is limited by its
    slow processes, limited resources, and limited remedies.
        So in order for the TCPA to continue to remain relevant and
    effective going forward, our report from 2014 makes the
    following recommendations: We recommended increasing government
    enforcement of the TCPA by providing State attorneys general
    with a larger incentive to bring TCPA cases and also
    authorizing the FTC to bring enforcement actions under the
    TCPA. It is involved in the enforcement of obviously portions
    of the laws relating to abusive telemarketing and is also the
    prime enforcer of most of our country's consumer laws, and we
    think they are better able to tackle this problem in concert
    with the FCC.
        We also recommended increased uniformity of the application
    of the TCPA by encouraging more frequent and quicker FCC
    rulemakings, focus more on the definition of terms and
    ambiguities in the law, less so with respect to carve-outs and
    exemptions for individual industries and actors.
        We hope to continue to protect cell phones by requiring
    express prior consent for any communication by call or text
    made to a cell phone. And we have other recommendations
    relating to the junk fax portion of the TCPA, which may also be
    of interest to the committee.
        We oppose efforts to remove or otherwise modify the private
    right of action in view of its importance in the enforcement of
    the statute, and we support placing increased restrictions both
    through law and through technology on entities that seek to
    manipulate caller ID.
        These recommendations and other issues are discussed more
    fully in our report. And I thank you for your time, and I am
    happy to answer any questions.
        [The prepared statement of Spencer Weber Waller follows:]

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Mr. Walden. Thank you very much for your testimony.
        I will now go to our final witness, Mr. Richard Shockey,
    principal at Shockey Consulting. We are delighted to have you
    here, sir. Please go ahead.

                      STATEMENT OF RICHARD SHOCKEY

        Mr. Shockey. Chairman Walden----
        Mr. Walden. Be sure to push the button on your microphone
    there. There we go.
        Mr. Shockey. There we go. Chairman Walden, Ranking Member
    Eshoo, and members of this committee, thank you for the
    opportunity to speak with you today.
        My name is Richard Shockey, and I am a consulting
    telecommunications engineer by profession advising
    telecommunications companies, their supplier community, the
    investment community, and actually other national governments
    on any number of issues related to our communications networks.
        I am also the chairman of the board of the SIP Forum. SIP,
    or the Session Initiation Protocol, is the fundamental Internet
    building block by which all modern voice communications
    networks in the United States are designed around, including
    those deployed by cable, enterprises, including the Congress I
    might add, and advanced residential networks.
        I am only speaking for myself here and none of the other
    members of the SIP Forum, et cetera, et cetera.
        I have been a working member of the Internet Engineering
    Task Force for over 15 years, and I currently serve on the
    FCC's North American Numbering Council, and I have previously
    served on the FCC's Communications Security, Reliability, and
    Interoperability Council.
        I am here to discuss many of the technical issues involving
    TCPA, robocalls, caller-ID spoofing, which are interrelated
    with each other and inter-tangled with each other. This
    committee is clearly aware of the new Robocall Strike Force.
    Though I am not a member of the strike force, I am intimately
    aware of the work the engineering community is contributing to
    that effort and happy to share it with you.
        I look forward to answering your questions.
        [The prepared statement of Richard Shockey follows:]

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Mr. Walden. All right. Thank you very much. And you win the
    prize for the shortest testimony. We appreciate all our
    panelists here and for what you have shared.
        I have got a couple of questions that came my way.
    Obviously, we all don't want the unwanted robocalls, the
    spoofing, all of those things, but I keep getting asked what is
    a robocall? What is an auto-dial call? And, Mr. Waller, maybe
    you can help because I haven't been able to get a definitive
    answer that if I pick up this device called a mobile phone and
    in the address book push a number, it auto-dials. Some would
    argue that constitutes an auto-dial, a robocall. If I manually
    dial the number, some would argue, well, that gets around it,
    but others say not necessarily because the device is capable of
    doing that. Do you believe there is clarity in the law on this
    matter, and if so, which is it?
        Mr. Waller. Mr. Chairman, it is a good question. I would
    have to go back and look carefully, particularly at the 2015
    FCC omnibus rulings to see what their current position is and I
    don't have that at the tip of my tongue.
        Mr. Walden. All right.
        Mr. Waller. I would certainly take the position, I think,
    that manual-dial call on a device is a manual-dial call and
    would not be captured by the auto-dial----
        Mr. Walden. Because one of the other issues that comes up
    is if you have a list of customers in a system and you need to
    communicate with them, does it really in today's technology
    make sense that you have to hire people to manually punch in a
    number that otherwise could come down and mechanically be
    dialed. That is treated as a robocall because it is auto-
    dialed, right?
        Ms. Turano, you seem to be agreeing with me on this point.
    Is this something you all have run into? Mr. Mock?
        Ms. Turano. You are right. I am nodding over here.
        Mr. Walden. Why?
        Ms. Turano.I appreciate the question and I think there is
    an important distinction is because frankly of the cost related
    to those types of calls. For us to hire an employee to make
    manual phone calls, depending on the length of the call, it
    could be anywhere between $6 to $10. If it were an auto-dialed
    call, it could be anywhere between 35 to 65 cents. And so those
    are funds that could otherwise----
        Mr. Walden. And you are allowed to make that call one way
    or the other, right? If you have permission into the cell phone
    and to use a cell phone number, then you can do the auto-dial?
    You could use technology like we all do with our--anybody have
    an address book with phone numbers? Anybody really know phone
    numbers anymore? Do you still go around in the wheel? I don't
    think so, right?
        Ms. Turano. Right, the----
        Mr. Walden. But this antiquated law makes you do that,
    doesn't it?
        Ms. Turano. It distinguishes between a landline and a cell
    phone, yes.
        Mr. Walden. All right. Mr. Mock, what have you run into in
    that respect?
        Mr. Mock. Well, certainly, from Snapping Shoals'
    standpoint, we operate at cost for our members, and any
    additional manual processes that are added ultimately would
    have to be passed along through our electric rates onto our
    members.
        Just to give the committee an idea of volume and our issue
    with prepaid----
        Mr. Walden. Right.
        Mr. Mock [continuing]. Particularly highlights the volume
    of phone calls. But Snapping Shoals' 11,000 prepaid consumers
    in August of 2011 received in excess of 220,000 low-balance
    notifications. That is 23 notifications per member per month.
        Mr. Walden. Now, some people might say that is too much; I
    don't want that.
        Mr. Mock. I would absolutely agree, but we are dealing with
    a population that will quite literally pay $5 and $10 towards
    their electric account every single day. And so as we maintain,
    say, a $20 minimum balance and as that balance goes below $20,
    the member pays $10, that may only buy them a few days. In some
    cases with the lower payments, these members are receiving
    phone calls day after day after day and to have a small
    business such as ours place that volume of phone calls just
    simply is not feasible cost-wise or----
        Mr. Walden. Are these calls your consumers actually want?
        Mr. Mock. Absolutely. Since----
        Mr. Walden. What happens if they fall behind? Does their
    power get cut off? And what does that cost them if that
    happens?
        Mr. Mock. Because they are a prepaid member, there are no
    additional fees. At this point, once the balance falls below
    zero, the meter automatically disconnects. Once they make a
    payment, automatically comes on.
        Mr. Walden. All right.
        Mr. Mock. Outside of the prepaid program, we have also
    experienced some difficulty with our regular consumers. Just a
    simple phone call for a member of 20 years goes out of town for
    5 or 6 weeks, forgot to pay the bill before he left----
        Mr. Walden. Right.
        Mr. Mock [continuing]. Paid a little extra as a matter of
    fact but not quite enough, he comes home to a house with thawed
    freezers, ruined floors, and in conversations, he simply wanted
    a phone call. Prior to June of 2014, he would have received a
    phone call.
        Mr. Walden. But because of the class-action lawsuits or
    whatever else----
        Mr. Mock. Absolutely, and----
        Mr. Walden [continuing]. You have backed off doing that?
        Mr. Mock. We have a strong practice of verifying phone
    numbers at every opportunity.
        Mr. Walden. Right.
        Mr. Mock. And for us, the issue of reassigned phone numbers
    and the volume particularly that can stack up with a reassigned
    phone number is really where our----
        Mr. Walden. All right.
        Mr. Mock [continuing]. Material concern is.
        Mr. Walden. I wish I had more time. I would pursue that
    course because that is the next----
        Mr. Mock. Thank you.
        Mr. Walden [continuing]. Big issue on my list. But we will
    go now to the gentlelady from California, Ms. Eshoo.
        Ms. Eshoo. Thank you, Mr. Chairman, and thank you to the
    witnesses.
        I think what I would like to do is just ask a
    straightforward question of three out of the four of you. Mr.
    Waller, you made recommendations of what you thought we should
    do, and that is most helpful. So one or two sentenced, Ms.
    Turano. What do you recommend that we do to address what we are
    here for?
        Ms. Turano. Sure. Thank you.
        Ms. Eshoo. What is your top recommendation, quickly?
        Ms. Turano. Thank you. My top recommendation has to with a
    reconciliation comparing the language within TCPA and certain
    language within HIPAA. They are both statutes that govern this
    practice and the Medicare Advantage and Medicaid programs.
    However, there is a disconnect----
        Ms. Eshoo. I have it. I got it. OK.
        Ms. Turano. Thanks.
        Ms. Eshoo. Thank you. Mr. Mock?
        Mr. Mock. Thank you. I think our top recommendation simply
    would be to introduce some measure of reasonability in
    application into the law. Additional exemptions----
        Ms. Eshoo. But something specific. I understand everybody
    will say here, even if they disagree with each other, that they
    are all reasonable, so be specific.
        Mr. Mock. Thank you. The definition of called party at this
    particular point in time leaves absolutely no liability on the
    called party, and in our case, whenever the called party is not
    the intended, the reasonable application that might ask a----
        Ms. Eshoo. Well, I understand----
        Mr. Mock [continuing]. Called party----
        Ms. Eshoo [continuing]. What you are talking about, but in
    your written testimony, if I read it correctly, you all made
    500 calls over, I think, 13 months to a reassigned number. I
    mean, 500 calls and you want to put the burden on the person
    that receives the call? Is that what you are saying?
        Mr. Mock. Five hundred phone calls absolutely sounds
    excessive. Again, these----
        Ms. Eshoo. Well, it is excessive.
        Mr. Mock. These are members that have requested these daily
    notifications. If a member does not receive a notification,
    their power is out. In this particular case a reasonable
    application of the law might have looked at this case and just
    asked the question would it be reasonable----
        Ms. Eshoo. Well, I understand reasonable, and I don't know
    how we do this, but we can't reshape TCPA based on your co-
    operative. We are going to have to look for something that is
    going to help you, but it is a very unusual, in my view,
    business model.
        Mr. Shockey?
        Mr. Shockey. These are policy questions, and I defer to the
    other witnesses----
        Ms. Eshoo. So ask the engineer and consultant? You don't
    have even one----
        Mr. Shockey. Well, I think you can't look----
        Ms. Eshoo [continuing]. Recommendation for us?
        Mr. Shockey. There are a number of things I would bring up.
    The number one thing I would is you can't look at TCPA in
    isolation. We are going to have to look at the Truth in Caller
    ID Act specifically. The act is creating a great deal of the
    problems with robocalls because the way it is constructed.
        Ms. Eshoo. But tell us the fix. Everybody is telling us the
    problems. We know what the end result of the problems. What do
    you recommend we fix? How would you do it? You are the expert.
    That is why you all came here to testify.
        Mr. Shockey. There are issues involving what I would
    consider adding safe harbor, as well as----
        Ms. Eshoo. Safe harbor for whom?
        Mr. Shockey. Safe harbor for the entity making the calls.
    And the telecommunications companies really do need to safe
    harbor. It is also in good-faith provisions that in good faith
    here for these entities such as a co-operative and health care
    providers and financial institutions that if they are trying to
    do this is in good faith, they should have some reasonable
    protection from unwarranted lawsuits.
        Ms. Eshoo. And what is----
        Mr. Shockey. What is in good faith?
        Ms. Eshoo. Are there limits to what they do or are there--I
    mean, is it you just enter a safe harbor and then do whatever
    you want?
        Mr. Shockey. No, that I think can be worked out----
        Ms. Eshoo. There are financial institutions but then there
    are some that abuse. They never stop calling to market their
    goods. Is that considered safe harbor in your view?
        Mr. Shockey. No, but safe harbor I would say there is a
    difference between marketing and also financial protection,
    which is I get occasionally both telephone calls as well as
    text messages when I make a purchase, say, for instance, over
    $500. I need that. I want that. And within reason I am willing
    to accept a certain amount of marketing materials one way or
    the other. It is a fine line. It is discretionary.
        However, I think that the problem we have seen in the act,
    in TCPA, is it has been unreasonable. And especially for
    smaller firms. It is one thing for AT&T or Bank of America or
    Dominion Resources to be able to protect themselves. It is
    another for a relatively small firm or manufacturing firm or a
    small electric co-operative to defend themselves against these
    kinds of class-action suits.
        My belief is we have to look at this as a larger machine.
    There is TCPA, there was the Truth in Caller ID Act. I believe
    the telecommunications firms are committed to injecting
    cryptographically secure material into the networks itself that
    begins to reduce the problem of spoofing and robocalls at its
    source.
        Mr. Walden. We need to----
        Ms. Eshoo. Yes. I am waiting for him to finish. Mr.
    Chairman, can I just ask unanimous consent to place Electronic
    Privacy Information Center's letter----
        Mr. Walden. Sure. Oh, absolutely.
        Ms. Eshoo [continuing]. In the record? Thank you.
        Mr. Walden. Yes, without objection.
        [The information appears at the conclusion of the hearing.]
        Mr. Walden. And I thank you for your answer.
        I will now go to the gentleman from New York, Mr. Collins,
    for questions.
        Mr. Collins. Thank you, Mr. Chairman.
        I think we are here today really talking about unintended
    consequences. And there is no perfect solution. There can never
    be a perfect solution. And certainly I appreciated Mr.
    Shockey's comments about safe harbor, common sense, and really
    small businesses--I am a small business guy--who really live in
    fear of some of these class-action lawsuits and in some cases
    might be withholding the information that somebody--like Mr.
    Waller saying, if somebody is going to--for every purchase over
    $500 I would like to know it just in case, things of that sort.
         But my question, Ms. Turano, is in your business--in fact,
    health care today, patients come in, they are treated, they may
    have a high deductible plan. They may not even realize that.
    After they have come, they have gone, they are treated, I would
    have to expect sometimes left with people owing substantial
    money. And you are in business and have to stay in business
    based on cash flow and collecting money. And you are not a
    telemarketer, but I have to expect you worry about and are
    frustrated by making a follow-up call to someone who, you know,
    through ObamaCare or some other reason is stuck in a high
    deductible plan. They could owe you thousands of dollars.
        You need that money to stay in business and provide your
    service, and yet, under the TCPA what are you? Are you a
    collection firm, which you are not, or are you just trying to
    protect the financial interests for all your other patients,
    and unfortunately, having to call folks to say you owe us some
    money, based on your insurance plan and high deductible,
    others, could you just maybe comment on some of those
    unintended consequences relative to you providing health care,
    something we all know we need?
        Ms. Turano. Sure. Thank you. And actually, the law provides
    that we do not make these types of phone calls to cell phones
    about payment. We make automated phone calls with consent for
    health-related purposes. So we are not behaving like a
    collections agency. In fact, we are only making calls, sharing
    health care information with the members.
        Mr. Collins. So what can you or can't you do relative to
    try to collect money that is owed to you by a patient that has
    come in, been treated, and now they owe you money?
        Ms. Turano. Well, I would assume use traditional other
    methods, whether that be sending them a bill in the U.S. mail
    or we certainly have the ability to, if there were a landline
    available, we could use that. But using an auto-dialer to a
    cell phone or using an auto-dialer to text a cell phone is not
    something that we would do to attempt to collect----
        Mr. Collins. Which, again, as the chairman noted in his
    opening comments, as many as half of Americans now don't even
    have a landline.
        Ms. Turano. Correct.
        Mr. Collins. Well, thank you very much. Again, it is the
    unintended consequences--I think really we all want the same
    thing. No one wants the annoying calls, trying to sell
    something but, where does the fine line come? And with the fear
    of litigation, at what point do good phone calls stop or
    reasonable phone calls?
        Mr. Shockey. Congressman, I think what a lot of people are
    struggling with here are what are genuinely legitimate calls
    from people who have a prior business relationship. And what
    some of us are worried about, which is the really fraudulent
    calls that are attacking vulnerable populations, the aged one
    way or the other, those of us such as myself and the
    engineering community, we would like to crush the fraudulent
    calls immediately. Hang them, please.
        But these issues that you are bringing up, Congressman,
    there are fine lines here, and I certainly understand the
    frustration of small business owners that they are getting
    entrapped with a lot of ambulance-chasers--let's put it
    bluntly--who are using TCPA to extract--it is fraudulent in its
    own sense to a certain extent.
        I am just a poor, dumb engineer here. It is very hard for
    me to distinguish issues involving policy versus issues
    involving engineering, but I certainly understand your concern.
        Mr. Collins. And I think this hearing is really an
    informational hearing to bring some of these issues forward. We
    are not going to solve the issues today, but your testimony is
    certainly much appreciated. And, Mr. Chairman, I think it is a
    very timely committee, and my time has run out so I yield back.
        Mr. Walden. The gentleman yields back.
        Ms. Turano, just before I go to Mr. Pallone, when you talk
    about sharing health care information, is that the results of a
    blood test? Is that what you are talking about?
        Ms. Turano. Those are the types of calls I am talking
    about, yes. It could be a reminder to fill a prescription, to
    pick up your prescription. It could be a reminder to receive or
    to seek out preventative tests or screenings. It is those types
    of calls that I am----
        Mr. Walden. OK.
        Ms. Turano [continuing]. Talking about.
        Mr. Walden. All right. Thank you.
        Mr. Pallone.
        Mr. Pallone. Thank you. I wanted to ask Mr. Shockey, in
    your written testimony you note that Congress can be helpful in
    ensuring that consumers benefit from the various technological
    solutions that can help reduce robocalls. Can you just tell me
    more specifically what technological steps you think Congress
    could take to better protect consumers and stop the robocalls?
        Mr. Shockey. Thank you, Congressman, for your excellent
    question there. The technological solutions that we are
    proposing, the engineering community, basically looks upon the
    fraudulent robocall problem as essentially a form of
    cybersecurity attack. Therefore, we need to go into the core of
    the voice communications network and use modern cryptographic
    methodology such as public infrastructure to basically sign the
    caller ID, sign the CNAME data, potentially make more
    information about the call party available to the consumer.
        One of the things that we are working very diligently on on
    a technology side is in those cases where there is a clear
    prior business relationship allowing for more information to be
    displayed to the consumer. We are looking at some things like a
    green check box which is this call has been validated, a big
    red check box, no, this is not really the IRS involved, some
    kinds of other form of visual indicators that the call, at
    least from the network's perspective, has been authenticated
    from the called party, and we can do better things like track
    and trace one way or the other.
        Those are the technological solutions that we have. As for
    whether or not Congress needs to further enhance the existing
    portions of title 47, I am not sure at this particular point.
    The relevant sections of the act that I know of, which are
    251(e)(1), which is plenary authority over the numbering plan.
    The Commission already has that. They use that for numbering
    plan administration, local number portability.
        I believe, at least in my own--I am not a lawyer and I
    don't play one on TV so I can't answer that question, but I
    think they actually have sufficient authority to act if other
    aspects of the statutes are clear as to what the true intent of
    Congress is.
        Mr. Pallone. OK. Rather than fraudulent calls, I wanted to
    talk about telemarketers that we never want or we never asked
    for. And, Professor Waller, you note in your written testimony
    that Congress should require that telemarketers receive express
    consent from consumers before they call their cell phones. Can
    you explain why you think strong consent is so important for
    consumers?
        Mr. Waller. Yes. Thank you. I think that the requirement of
    consent has been a core provision of the TCPA from the very
    beginning, and I would urge that it be strengthened if
    anything.
        The situation that Chairman Walden referred to with respect
    to text messaging, making temporary job opportunities available
    is a perfect illustration of how valuable it is when the
    consumer has consented and how it is simply unwelcome--perhaps
    not harassing but simply unwelcome and invasive in their lives
    if they have not consented.
        And some of the examples and many of the horror stories
    that are presented are really about consent, and services are
    valuable if the consumer has consented and services are
    unwelcome and telemarketing is unwelcome when they haven't, and
    that is a critical component of the act.
        Now, some of the other horror stories that have been
    presented are not about consent but about reassigned numbers
    and reaching out to people who perhaps they intended to get
    someone who had given consent but they didn't reach someone,
    and in that case, the person they reached has not consented.
    There are still cost consequences to the 75 million consumers
    who have some form of prepaid cell phones. These calls are
    unwelcome. And it is the caller or the people they use who are
    the best cost-avoiders in that circumstance using currently
    available databases and some of the things that are in
    development that Mr. Shockey has talked about.
        Mr. Pallone. Let me just ask quickly. The FCC has been
    issuing more rulings on the TCPA recently. Do you think this
    recent uptick in FCC action has been beneficial for consumers?
        Mr. Waller. I think it has. I think the 2015 omnibus ruling
    has been helpful by focusing on certain definitions, in
    particular, this reassigned number issue, the question of
    vicarious liability and the definition of auto-dialers that
    Chairman Walden was asking about. I think rulemaking by its
    very nature is a lengthy process and I commend the FCC for
    doing the best job it can, but it is really hit with a flood of
    petitions over and over again by the firms or industry seeking
    special treatment.
        Mr. Pallone. Thank you. Thank you, Mr. Chairman.
        Mr. Walden. OK. The gentleman's time is expired.
        I now go to the vice chair of the subcommittee, Mr. Latta.
        Mr. Latta. Well, thank you, Mr. Chairman, and thanks to our
    panel for being here this morning, appreciate it.
        Ms. Turano, if I could start with you, in your testimony
    you stated that health care-related texts and calls lead to
    more engaged patients, better patient outcomes, and lower
    health care costs for consumers. It seems obviously that public
    health and safety notifications, along with individual health
    reminders, are helpful and important. Under current law, am I
    right to believe that these types of notifications are
    underutilized due to liability risks?
        Ms. Turano. Yes, sir, I believe that is accurate.
        Mr. Latta. Let me follow up then. How can we better update
    then the TCPA to ensure that actors with good intentions are
    able to reach the consumers and patients to better serve them?
        Ms. Turano. Sir, currently, there is an exemption within
    the TCPA that is extended to health care providers to make
    these types of phone calls that I have been referring to.
    Unfortunately, that is a vague term. Within the HIPAA statute,
    however, there is language that could be imported that is far
    more clear and has a much more specific definition, and that is
    a term called HIPAA-covered entity. If that language were to be
    imported within the TCPA, that would make things much more
    clear for companies like WellCare, and that would allow us to
    make these types of phone calls.
        Mr. Latta. Well, I was going to follow up on that. And let
    me ask you this because under HIPAA is it more clear for
    landlines than it is for cell phones?
        Ms. Turano. Is it more clear within HIPAA for landlines----
        Mr. Latta. Right, is that----
        Ms. Turano [continuing]. Or cell phones? HIPAA covers all
    health care communications. It does not make a distinction
    between cell phones and landlines from my understanding.
        Mr. Latta. OK. But is there any type of confusion out there
    today for folks out there then----
        Ms. Turano. Operate----
        Mr. Latta [continuing]. If you are looking on the cell
    phone side?
        Ms. Turano. No.
        Mr. Latta. There isn't? So there is not a problem then for
    people that--especially for you all to go to contact folks on
    that and then----
        Ms. Turano. Well, if we were operating under HIPAA
    guidelines, those are very clear, and it is very prescriptive
    about what we can say, whom we can contact, how, and why. If
    those types of guidelines were transferred over to be
    consistent with the TCPA, it would be much more straightforward
    with us. There would be no gray area in terms of who we can
    contact, whether it is a landline or a cell phone.
        Mr. Latta. OK. Thank you.
        Ms. Turano. Thanks.
        Mr. Latta. Mr. Waller, I am wondering, how many of the
    complaints--and maybe if you might know this, how many of the
    complaints that the FCC and FTC receive are from the same
    numbers, any idea? Do we have any kind of knowledge out there
    as to who the bad actors are out there that are making a lot of
    these calls that people receive? Is there a way to find that
    out?
        Mr. Waller. It is my understanding that the way the FCC
    tracks complaints on this issue that they accumulate complaints
    with respect to specific numbers and senders when they can
    identify them. So I believe the FCC can provide that
    information. I am not clear on how the FTC tracks robocall
    complaints, but I am aware that they receive between 200,000
    and 300,000 per month.
        Mr. Latta. All right. Thank you.
        Mr. Shockey. Congressman, can I address some of that
    because----
        Mr. Latta. Yes. Yes.
        Mr. Shockey [continuing]. It is slightly tactical?
        Mr. Latta. Yes.
        Mr. Shockey. It is correct that the way that the FCC and
    the FTC track this is via the number, but the number is
    inaccurate because it has been spoofed----
        Mr. Latta. Right.
        Mr. Shockey [continuing]. In most of the cases.
        Mr. Latta. And as the chairman mentioned in his opening
    statement that we just passed out of full committee----
        Mr. Shockey. Correct.
        Mr. Latta [continuing]. The bill especially on the spoofing
    end, correct, yes.
        Mr. Shockey. And they are coming in through intermediary
    providers and the current legislation, which was passed
    yesterday, that requires intermediary transit providers to
    identify themselves with the FCC makes a great deal of sense.
        What we do know anecdotally, by the way, is that the number
    of actors creating particularly the fraudulent robocalls is in
    fact relatively small. They are quite sophisticated and I might
    add I have done consulting work for the CRTC in Ottawa and
    Ofcom in the United Kingdom, and on a per capita basis the
    problem in Canada and in the United Kingdome is in fact worse.
    And the technical solutions that we are looking at deploying
    may actually have international implications as well and offer
    United States leadership to our friends, allies, and partners,
    on this area as well.
        One of the things that I know law enforcement is concerned
    about is this track-and-trace issue and the call validation
    technology that we want to interject into the network should be
    able to provide law enforcement with considerably better tools
    than what they have now.
        Mr. Latta. Yes. Thank you very much, Mr. Chairman. My time
    is expired and I yield back.
        Mr. Walden. I thank the gentleman. And we have a list for
    the committee at some point here of the conflicts in statute
    that require people to make calls that then put them in
    conflict with TCPA. We do have that, too, as part of our
    discussion.
        Mr. Doyle.
        Mr. Doyle. Thank you, Mr. Chairman.
        Mr. Waller, I want to follow up on Mr. Pallone's questions
    about expressed consent. I want to ask you if you think we need
    to reexamine the rules about prior express consent through an
    intermediary because it seems to me recent court cases seem to
    affirm the notion that debt collectors can harass consumers
    even when they have not explicitly been given consent to do so.
        So I am concerned that this practice of consent through a
    third party sometimes leads to loopholes where consumers are
    harassed by debt collectors or advertisers in situations that
    they haven't expressly consented to. What problems do you see
    in this practice and how would we deal with that?
        Mr. Waller. I share your concern. Consent should mean
    express consent expressed in a reasonable fashion that is part
    of the TCPA. There is growing amount of case law, plus the
    notion of reasonableness as an accepted standard throughout
    consumer protection law, most of American law. Third-party
    consent I think should be extremely limited or simply abolished
    whenever humanly possible.
        The area that you talked about particularly with debt
    collection is one of the top areas of consumer complaints. I
    think it is unfortunate that there was a carve-out for debt
    collection from the Federal Government or its contractor
    recently in the Budget Reconciliation Act.
        So I think the number of people who are now exposed to
    those calls are certainly greater. It is 60-some million people
    depending on which debt programs you are talking about. So I
    would like to see a return to the definitions that were used
    when consumers directly consented, whether it is in writing or
    some other fashion that can be legitimately recorded by the
    sender so they get the information they want and simply not be
    deemed to consent by the actions of a third party.
        Mr. Doyle. Thank you. Let me ask you, historically, phone
    carriers have had an obligation to connect all phone calls, but
    recently, when the FCC loosens this restriction in order to
    promote the development and deployment of robocall-blocking
    technologies, I want to ask you, do you think the common
    carrier exemption should be reexamined as there will be an onus
    on carriers to connect the right calls? What safeguards are
    necessary to ensure that carriers aren't overzealous in their
    call-blocking?
        Mr. Waller. I think in some ways Mr. Shockey may be better
    able to answer that than I do, but I do think it is a
    combination of legal and technological solutions, so the gold
    standard would be a single rule that applies across all
    technology platforms, whether it is landlines, whatever is left
    of fax machines, cell phones, and whatever is yet to come--and
    e-mail obviously--where a consumer can opt out and be done with
    it where we would be, in my view, aiming for a universal do-
    not-contact register, not just do not call, and that obviously
    involves a sensible drafting of interaction of legal and
    technological requirements.
        Mr. Doyle. Mr. Shockey, do you want to answer?
        Mr. Shockey. I agree with Mr. Waller completely,
    Congressman. I have serious problems with blacklists. We have
    problems with blacklists in the past in this country in one way
    or the other. The problem in getting on a blacklist is how do
    you get off of it, and I have personally run into this problem
    myself trying to send email to this committee because my
    domain, Shockey.us, was thrown into your junk mail pile and how
    do I get off.
        Ms. Eshoo. And look it, you got here.
        Mr. Shockey. I got here, yes. I had to use my Gmail
    account. But these are the kinds of things that concern me
    about blacklisting, which is why those of us in the engineering
    community have tried to look at this from a much more holistic
    point in the core of the network, namely, that the originating
    call is cryptographically signed by the call originating
    network, it is authenticated and verified by the terminating
    network, and that the call detail records and the call routing
    records reflect that so that we have got appropriate track-and-
    trace mechanism here.
        And recourse in the event that you are thrown into a black
    hole has to be somehow constructed either possibly through
    regulation, hopefully by best current practices among the
    service providers one way or the other. If we march down this
    road, we are very, very concerned about that and we know where
    the problem is.
        Mr. Doyle. Thank you. Mr. Chairman, thank you.
        Mr. Walden. Thank you, Mr. Doyle.
        We will now turn to Mr. Long from Missouri.
        Mr. Long. Thank you, Mr. Chairman.
        And, Mr. Shockey, I hear from constituents about robocalls,
    as everyone else does, and we all find them extremely annoying,
    I believe. Finding a solution, of course, is very important so
    my question is this: This issue seems to involve all segments
    of telecom, including the carriers, equipment-makers, standard-
    setting bodies, cable, voiceover-Internet protocol providers,
    basically everyone.
        Mr. Shockey. Yes.
        Mr. Long. You are nodding your head. So is it important to
    have these groups involved in finding a solution to stopping
    these unwanted calls? Is it important to have all these
    different folks at the table and involved?
        Mr. Shockey. Well, thank you, Congressman. The answer to
    your question is absolutely. And in fact I personally have been
    involved in this for the last 4 years with our nation's service
    providers. I have been involved in the tactical standards work
    directly involving all of this. Of course it is difficult to
    get all of these people to consensus. We are much like any
    other group of professionals in one way or the other. It is
    hard to get agreement, which is why it has taken so long.
        But I believe we have a general outline of a plan, and that
    is where we hope--and I believe the Robocall Strike Force, when
    it reports on October the 17th, can at least outline a plan.
    And this committee and the FCC can move forward with all
    deliberate speed in implementing those recommendations.
        Mr. Long. OK. Thank you. But my point is that everyone
    needs to be involved in this process.
        Mr. Shockey. And everyone is, sir.
        Mr. Long. Yes, OK.
        Mr. Shockey. I guarantee you that.
        Mr. Long. Ms. Turano, the types of calls that WellCare is
    making to its clients, you have mentioned it a few times but
    can you kind of just give an encapsulated what your company
    does, what these calls are?
        Ms. Turano. Certainly. Thank you.
        Mr. Long. Can you pull that a little closer to you? It has
    got a long cord on here. Pull her up. There you go.
        Ms. Turano. Is that better?
        Mr. Long. You bet.
        Ms. Turano. OK. Thank you. The types of phone calls that we
    are referring to really are about health care reminders----
        Mr. Long. And that is something somebody would want to hear
    about?
        Ms. Turano. One would think so, yes.
        Mr. Long. OK.
        Ms. Turano. Our members tend to be vulnerable older
    Americans, disabled Americans, or folks that have less access
    to resources, less access to an infrastructure, a support core
    if you will. And so we feel it is important to be able to make
    these calls to them. They increasingly rely on cell phones. We
    want to be able to help them with their health care, and this
    is an efficient and effective way of doing that.
        Mr. Long. OK. Well, I think I agree and most reasonable
    people would agree that those are the type of calls that folks
    are anxious to have, glad to have prescription reminders,
    whatever they may be. But has the FCC's order impacted
    WellCare's calling practices, and if so, how?
        Ms. Turano. Yes, absolutely. Currently, we do not make
    auto-dialer calls or texts to cell phones. That is a practice
    that there----
        Mr. Long. You mean you can still talk on a cell phone? You
    can still call?
        Ms. Turano. We could call you on your cell phone----
        Mr. Long. Really? I didn't even know you could talk on
    these anymore. I tell everyone to text me, and you are not
    allowed to text.
        Ms. Turano. I would be happy to text you a reminder to go
    pick up----
        Mr. Long. You could even call me.
        Ms. Turano [continuing]. Your prescriptions but----
        Mr. Long.. I haven't talked on a phone in so long----
        Ms. Turano [continuing]. I am currently not allowed to do
    that.
        Mr. Long. All right. Especially being from Mizzou, you
    know.
        Ms. Turano. Yes, sir.
        Mr. Long. Get that in there. So these patients will
    potentially not be able to get the information that they need
    for their health care, correct?
        Ms. Turano. If they are relying on a cell phone, I am----
        Mr. Long. Which everyone does.
        Ms. Turano [continuing]. Extremely hampered from being able
    to contact them.
        Mr. Long. OK. I have another question here for you. In your
    testimony you highlight the importance of using cell phones to
    reach all these--and you just now mentioned how important it
    is. Why not just communicate with mail or landlines?
        Ms. Turano. Well, sir----
        Mr. Long. Do you know what a landline is?
        Ms. Turano. I do, thank you. In fact, I think I might still
    have one. Because when you are talking about the members that
    we typically have, I think I mentioned that in many cases they
    have unstable housing, and therefore, they might not have a
    consistent home address so U.S. mail is not going to be an
    effective way to reach them.
        Relatedly, they might not have a consistent landline if
    they are not in stable housing, so therefore, those two methods
    can't be guaranteed to be an effective way of reaching them.
        Mr. Long. OK. Thank you. As they say, the commonsense
    problem is it is not common, and I think that some of these
    things we are looking at, a little common sense would help with
    the FCC.
        Ms. Turano. Thank you.
        Mr. Long. So, Mr. Chairman, I yield back.
        Mr. Walden. The gentleman yields back.
        The chair recognizes the gentleman from California, Mr.
    McNerney.
        Mr. McNerney. Wow, what a great hearing, Mr. Chairman.
    Thank you. And I thank----
        Mr. Walden. You got it.
        Mr. McNerney [continuing]. The panelists.
        Mr. Shockey, I was really thrilled to hear that public-key
    cryptography is used to authenticate caller ID.
        Mr. Shockey. It will be.
        Mr. McNerney. Oh, it will be? OK. That was my next
    question. How widely adopted is that technology? Or when is it
    going to be adopted in a wide fashion?
        Mr. Shockey. As Congressman Long pointed out, there are a
    lot of people here involved, obviously: Our nation's carriers,
    the equipment suppliers, the Congress potentially, but
    certainly the Federal Communications Commission. We have what
    we believe is the outline of a plan and how long that plan will
    take to implement I would choose not to speculate about.
        Mr. McNerney. OK.
        Mr. Shockey. However, it is reasonable--public-key
    cryptography is used all over our economy. The electric meter
    on the side of your house uses PKI, your credit card uses PKI,
    obviously the Web browsers when you buy something from Amazon
    use PKI. This is proven, well-understood technology.
        We have the standards now pretty much ready to go. All they
    need is testing. They need to be put into the actual kit that
    our nation's carriers have. We are very concerned that we don't
    break what we already have. We need to maintain the security,
    the reliability, and the interoperability of at least what we
    have today when we inject this new technology in there, but we
    can do this.
        Mr. McNerney. Well, thank you. I understand that another
    potential solution to unwanted and fraudulent calls is
    malicious call tracing. Can you describe that a little bit?
        Mr. Shockey. Well, malicious call tracing is in fact
    partially solved by this call validation technology using PKI
    because the basic concept--and I will just try and walk you
    through it. Basically, when you place a phone call from any
    access network--that would be cable or mobile or traditional
    landline or enterprise from within this building, the service
    provider would actually sign the underlying call signaling that
    says, yes, I am, well, AT&T and I want this other carrier to
    terminate the call.
        So it signs what is known as the SIP invite. It sends it
    along its merry way, and somewhere along the line level 3 gets
    the call. It uses PKI to verify that AT&T was sending this call
    and then terminates the call in the normal manner. So we
    actually now have an origination and a termination,
    cryptographically sound methodology for track and trace.
        Now, beyond that, we could actually display to the consumer
    validated, good to go. We could also display to the consumer
    such as on your mobile device, on your enterprise phone here in
    the Congress or on your television set if you are using
    advanced network, you know, more information about whether or
    not this call has been trusted or if it is valid or not. So
    empowering the consumer is one of the key advantages of trying
    to deploy this technology and give enforcement in law
    enforcement that are track-and-trace.
        Mr. McNerney. So the trace back is another form of this
    technology is that----
        Mr. Shockey. Yes.
        Mr. McNerney [continuing]. Right?
        Mr. Shockey. Yes.
        Mr. McNerney. And then I guess the last thing is the do-
    not-originate. And again, they sound like they are all sort of
    based on the same technology, those three methods.
        Mr. Shockey. Do-not-originate is a little bit different.
        Mr. McNerney. Is it?
        Mr. Shockey. That is going to require, I think, a little
    bit of study. I know the public safety folks are extremely
    concerned about do-not-originate because of the various
    phishing attacks on public safety institutions one way or the
    other. It is certainly worth investigation, and people are
    actively talking about it. And I certainly want to wait and see
    what the final report of the strike force is before making a
    determination, but it is technologically feasible. Let's put it
    that way.
        Mr. McNerney. What is the most effective thing we can do
    here then is to----
        Mr. Shockey. Clarity. Again, as has been discussed by
    better policy experts than I am, having clarity in the
    legislation. I think you also have to look at the Truth in
    Caller ID Act. You also have to look at some other aspects of
    current legislation. Truth in Caller ID Act is bound to the
    problem with TCPA. If we can't secure the identity of the calls
    themselves, we can't fix the problem.
        Mr. McNerney. Mr. Chairman, I need another 5 minute but I
    will yield back anyway.
        Mr. Walden. Thank you. We will have more time later on
    probably to talk about this issue.
        But we will now, let's see, go to the gentleman from
    Florida, Mr. Bilirakis.
        Mr. Bilirakis. Thank you, Mr. Chairman. I thank the Ranking
    Member Eshoo as well for holding this very important hearing.
        Modernizing the 1991 TCPA statute has long been a goal of
    mine, and I am glad the subcommittee is holding this
    informational hearing today. I appreciate it so much.
        Ms. Turano--and I apologize if these questions were already
    asked. I understand that WellCare filed a petition with the FCC
    seeking clarity on the TCPA provisions. Can you briefly outline
    the basis for WellCare's petition, please?
        Ms. Turano. Certainly. Thank you. WellCare and others filed
    a petition asking for clarity around some of the language
    within the 2015 declaratory order. That order uses the term
    health care provider, which is basically undefined. And there
    is quite a bit of vagueness around what entities fall within
    that definition.
        What we have asked for instead is a reconciliation between
    the language in the TCPA and the language in HIPAA, which is
    our governing statute for health care communications from
    Health and Human Services. If FCC were to import the language
    and use the term ``HIPAA-covered entity,'' that would clear up
    a lot of confusion around who falls within that definition,
    what rules govern that communication, and that would go a long
    way towards clarifying the guidance.
        Mr. Bilirakis. OK. In your opinion, how long are petitions
    pending with the FCC before receiving a response?
        Ms. Turano. Well, we filed our petition--WellCare and
    others filed our petition July 28 of this year. My
    understanding of FCC's process is that there is a comment
    period for 30 days. Then, there are additional comment periods
    that stack up on top of that. However, my understanding is that
    there is no deadline or time frame within which the FCC has to
    respond. Therefore, we wait.
        Mr. Bilirakis. Wow. How would the failure----
        Ms. Eshoo. We can help you with that.
        Mr. Bilirakis. Excuse me.
        Mr. Walden. We have a bill to fix that.
        Ms. Turano. Thanks.
        Mr. Bilirakis. Let's fix it. How would the failure to
    receive a timely answer hurt your patients? That is the bottom
    line.
        Ms. Turano. Certainly. As we wait, the way our consumers
    are being impacted is that we are hindered from being able to
    use an efficient and effective means of communication with
    them. So that means for those of our members who rely on cell
    phones, we are not making calls or we are not using the auto-
    dialer technology to make calls to remind parents about getting
    their children vaccinated. We are not using the most efficient
    technology to remind members to get preventative health
    screenings.
        And in what I think is a very significant example, if we
    were to have a member--and we frequently do have a member--
    being discharged from the hospital, as I have said a couple of
    times already, if we have a member who doesn't have a strong
    support system around them, which is frequently the case, we
    feel like we take on some responsibility for assisting them in
    the care provided after their discharge. So we would want to be
    able to contact them using this technology via cell phone to
    remind them to get their medications, to remind them to take
    them as the doctor prescribed them, to remind them about proper
    wound care and follow-up care.
        If we are able to do all that, it is only going to help
    their outcome versus if they are without those types of
    reminders. You are looking at a potential for infection, you
    are looking for a potential for a hospital readmission, which
    is a problem for the whole system, which is something we are
    hoping to avoid.
        So as we wait, we are severely hampered in our ability to
    be able to do that in the most efficient and effective way
    possible.
        Mr. Bilirakis. Thank you. To the panel--and you know I
    submitted questions to FCC Commissioner O'Rielly asking if he
    supports expediting petitions to provide clarity on obligations
    under the TCPA pending any congressional action. The
    commissioner expresses support for such efforts. Is this
    something that members of the panel can support since we don't
    know how long it will take for Congress to act? But we will
    act. And I wanted to ask the panel. We will start with Ms.
    Turano, please.
        Ms. Turano. Yes, sir. That is certainly something we would
    support.
        Mr. Bilirakis. Please, sir.
        Mr. Mock. I think I can say absolutely we would support
    more timely response from the FCC. In our particular case there
    were facts within the lawsuit we were faced with that, had
    definitions been more clearly defined, the situation might have
    turned out very different, so absolutely.
        Mr. Waller. Congressman, we are on record in supporting
    expedited review, but sometimes you don't always get the answer
    you want.
        Mr. Bilirakis. Thank you.
        Mr. Shockey. The answer is yes, that would be perfect.
        Mr. Bilirakis. Very good. Thank you very much. I yield
    back, Mr. Chairman.
        Mr. Walden. The gentleman yields back.
        The chair recognizes the gentlelady from Tennessee, the
    vice chair of the full committee, for 5 minutes.
        Mrs. Blackburn. Well, thank you, sir. And I am so pleased
    that we have the hearing today, that it is on the agenda. And
    sorry that I was late. We have had other hearings that we are
    dealing with this morning, and since our main room is under
    construction, we have to go to the Capitol and use a room
    there.
        Mr. Mock, I want to come to you. When we were preparing for
    this hearing and talking with some folks that are in the health
    care space and all, I was struck by how trial lawyers have
    seemed to use this as a piggy bank with the lawsuits. And
    looking at from 2010 to 2015 there was a 940 percent increase
    in the lawsuits under the TCPA. And the average payout for an
    attorney filing one of those suits was $2.4 million. I mean,
    this is just unbelievable. That tells us something is terribly
    wrong with this process.
        So the Snapping Shoals experience, and you had said in your
    testimony although the case has since been resolved, Snapping
    Shoals made substantial negative changes to our member
    notification offerings as a result of the complaint. So I want
    you to elaborate just a little bit if you will for the record
    on your experience of being sued and how that movement, you
    know, how you followed through to that movement. I know you
    articulated the changes that you made, but talk a little bit
    about that experience. Just one minute will suffice.
        Mr. Mock. Well, thank you very much for the question.
        In our example, we really felt like these were
    communications that were requested by our member. At any time
    those notifications could be discontinued, numbers could be
    changed, and certainly as we have looked to the future, our
    goal is to provide more flexible notifications.
        I should say that over the last few years it has been a
    more-common-than-I-would-like practice to maybe see a 1-800 ad
    late at night for any unwanted communications. In our
    experience I really felt like it would have been a very
    reasonable thing for someone to have received 500 phone calls
    to complain at least once. And so I think that is where the
    good-faith provisions and safe harbor provisions----
        Mrs. Blackburn. Got it.
        Mr. Mock [continuing]. For small businesses----
        Mrs. Blackburn. Yes.
        Mr. Mock [continuing]. Like Snapping Shoals would be very
    important.
        Mrs. Blackburn. OK. Got that.
        Mr. Shockey, just a little bit on reassignment and the
    difficulty of these reassigned numbers and tracking that.
    Listening to all of this today makes you wonder why there isn't
    a way to track reassignment more carefully or more easily so
    that companies can determine when there has been reassignment
    of a number. Do you have anything to add to that?
        Mr. Shockey. Well, actually, there is one thing I would
    like to add. The problem of reassigned numbers is real. We do
    have numbering databases that are currently deployed.
    Obviously, the number portability database is one of them.
    These have been altered from time to time. They could be
    repurposed to be able to add some sort of a field in the
    databases on when they would have been modified in some way,
    shape, or form. I don't think we necessarily need a new
    database.
        The other thing is one of the issues that is actually
    personal to me and I think is also relevant is I also am a big
    believer in national number portability, which is why can't we
    just have one telephone number and keep it, basically whenever
    you move? Twelve percent of the entire United States population
    moves very single solitary year, and that is actually creating
    the churn in the system because even if you go from the west
    side of New York to the east side of New York, you actually
    have to change your phone number because you have actually
    moved out of a boundary. And that is actually pretty ridiculous
    for the consumer if you sort of ask me.
        So we in the North American Numbering Council have actually
    recommended to the Commission that they consider a notice of
    proposed rulemaking on national number portability, which could
    reduce the church that we see in the numbering plan quite a bit
    and increase the size of the North American Numbering Plan by
    20 percent virtually overnight so that we don't have the kinds
    of problems in 408 area code for constantly splitting and
    splitting and splitting one way or the other.
        So it needs a little bit of study. I don't necessarily want
    to recommend that in advance of where the strike force could be
    reporting on that in the middle of October, but it certainly
    needs active consideration.
        Mrs. Blackburn. OK. I appreciate that. And as we wrap up, I
    would like for each of you to send me the three things you
    think we need to make certain we change as we look at the
    updates on the TCPA. I would just love to see that in writing.
        And with that, I yield back. Thank you.
        Mr. Latta [presiding]. Thank you very much. The gentlelady
    yields back.
        And seeing no other members to ask questions, I have a
    letter from the American Health Insurance Plans, their comments
    that they submitted before the FCC and also the Credit Union
    National Association. And I ask unanimous consent that these
    letters be inserted in the record.
        [The information appears at the conclusion of the hearing.]
        Mr. Latta. And on behalf of the gentleman from Oregon, the
    subcommittee chair; the gentlelady from California, the ranking
    member; and myself, we thank you all for participating in this
    panel today. It has been very informative and we appreciate it.
        And if there is nothing else to come before the
    subcommittee, we stand adjourned.
        [Whereupon, at 12:38 p.m., the subcommittee was adjourned.]
        [Material submitted for inclusion in the record follows:]

                     Prepared statement of Hon. Fred Upton

        Today's hearing will focus on a topic that unfortunately
    most of us have dealt with on a personal level: pesky
    robocalls. Many constituents have contacted my office in search
    of a solution to stop the unwanted calls, and I am sure the
    same is true for my colleagues. Unfortunately, there just
    doesn't seem to be a current solution that is entirely up to
    the task. Registering your number on the Do-Not-Call List
    simply isn't enough these days, and it is time we begin a
    thoughtful dialogue on providing our consumers with relief.
        I'd like to thank Ranking Members Pallone, Eshoo, and
    Schakowsky for their letter requesting a hearing on this issue
    of modernizing the Telephone Consumer Protection Act and for
    adding their voices to the growing chorus for this outdated law
    to be updated to meet the challenges of the 21st century. The
    FCC, experts in industry and the business community, and folks
    back home are all in agreement that it is time to bring this
    outdated law into the 21st century. Our consumers no longer
    feel protected under the law; and with seemingly relentless
    attempts at fraud occurring over the phone, who can blame them?
        The TCPA is failing on two fronts. First, the number of bad
    actors who are intentionally disregarding the TCPA is growing,
    and until the act is modernized, consumers will be under siege
    by unwanted pre-recorded messages and solicitations. Second,
    recent reform attempts have instead captured unintended good
    actors in the crosshairs, who as a result, face litigation for
    non-compliance with the TCPA despite their good faith.
        While we are all probably familiar with the frustration
    that robocalls are causing us on the receiving end of the call,
    what some of us might be less familiar with are the challenges
    faced by legitimate businesses who have been inadvertently
    caught in the crosshairs of the TCPA. As bad actors
    increasingly flaunt the TCPA to gain access to millions of
    consumers' phone lines, it is important that we recognize that
    there is a legitimate use of auto-dialing technology that
    doesn't fall under the same malicious category.
        Unlike the well-known ``Rachel from Card Services'' scam,
    you can put a face on the folks operating in good faith-they
    look like your kid's school, or maybe your doctor's office, or
    even your local credit union. Businesses using auto-dialers
    often have good intent when contacting their customers, and
    moreover, their subscribers have come to expect and rely on
    these types of calls.
        An update to the TCPA will do more to prevent unwanted
    calls and provide clear rules of the road for our legitimate
    businesses who are operating in good faith. We ought to have a
    holistic approach towards finding a solution that our
    constituents can rely on to protect them from unwanted calls,
    and that legitimate businesses can navigate without hiring an
    army of attorneys to ensure they are within the letter of the
    law just to be in touch with their customers. As you will hear,
    this is no easy task, but today's discussion will be an
    important first step towards crafting a modern law that
    protects consumers.
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