[House Hearing, 115 Congress]
[From the U.S. Government Publishing Office]





 ASSESSING CURRENT CONDITIONS AND CHALLENGES AT THE LYNDON B. JOHNSON 
               TROPICAL MEDICAL CENTER IN AMERICAN SAMOA

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

                           OVERSIGHT HEARING

                               before the

                  SUBCOMMITTEE ON INDIAN, INSULAR AND
                         ALASKA NATIVE AFFAIRS

                                 of the

                     COMMITTEE ON NATURAL RESOURCES
                     U.S. HOUSE OF REPRESENTATIVES

                     ONE HUNDRED FIFTEENTH CONGRESS

                             FIRST SESSION

                               __________

                         Tuesday, July 25, 2017

                               __________

                           Serial No. 115-21

                               __________

       Printed for the use of the Committee on Natural Resources



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                     COMMITTEE ON NATURAL RESOURCES

                        ROB BISHOP, UT, Chairman
            RAUL M. GRIJALVA, AZ, Ranking Democratic Member

Don Young, AK                        Grace F. Napolitano, CA
  Chairman Emeritus                  Madeleine Z. Bordallo, GU
Louie Gohmert, TX                    Jim Costa, CA
  Vice Chairman                      Gregorio Kilili Camacho Sablan, 
Doug Lamborn, CO                         CNMI
Robert J. Wittman, VA                Niki Tsongas, MA
Tom McClintock, CA                   Jared Huffman, CA
Stevan Pearce, NM                      Vice Ranking Member
Glenn Thompson, PA                   Alan S. Lowenthal, CA
Paul A. Gosar, AZ                    Donald S. Beyer, Jr., VA
Raul R. Labrador, ID                 Norma J. Torres, CA
Scott R. Tipton, CO                  Ruben Gallego, AZ
Doug LaMalfa, CA                     Colleen Hanabusa, HI
Jeff Denham, CA                      Nanette Diaz Barragan, CA
Paul Cook, CA                        Darren Soto, FL
Bruce Westerman, AR                  A. Donald McEachin, VA
Garret Graves, LA                    Anthony G. Brown, MD
Jody B. Hice, GA                     Wm. Lacy Clay, MO
Aumua Amata Coleman Radewagen, AS    Jimmy Gomez, CA
Darin LaHood, IL
Daniel Webster, FL
Jack Bergman, MI
Liz Cheney, WY
Mike Johnson, LA
Jenniffer Gonzalez-Colon, PR
Greg Gianforte, MT

                 Todd Ungerecht, Acting Chief of Staff
                      Lisa Pittman, Chief Counsel
                David Watkins, Democratic Staff Director
                                 ------                                

       SUBCOMMITTEE ON INDIAN, INSULAR AND ALASKA NATIVE AFFAIRS

                       DOUG LaMALFA, CA, Chairman
             NORMA J. TORRES, CA, Ranking Democratic Member

Don Young, AK                        Madeleine Z. Bordallo, GU
Jeff Denham, CA                      Gregorio Kilili Camacho Sablan, 
Paul Cook, CA                            CNMI
Aumua Amata Coleman Radewagen, AS    Ruben Gallego, AZ
Darin LaHood, IL                     Darren Soto, FL
Jack Bergman, MI                     Colleen Hanabusa, HI
Jenniffer Gonzalez-Colon, PR         Raul M. Grijalva, AZ, ex officio
  Vice Chairman
Rob Bishop, UT, ex officio

                                 ------     
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                CONTENTS

                              ----------                              
                                                                   Page

Hearing held on Tuesday, July 25, 2017...........................     1

Statement of Members:
    LaMalfa, Hon. Doug, a Representative in Congress from the 
      State of California........................................     1
        Prepared statement of....................................     2
    Radewagen, Hon. Aumua Amata Coleman, a Delegate in Congress 
      from the Territory of American Samoa.......................     3
        Prepared statement of....................................     4
    Sablan, Gregorio Kilili Camacho, a Delegate in Congress from 
      the Territory of the Northern Mariana Islands..............     5
        Prepared statement of....................................     6

Statement of Witnesses:
    Bussanich, Thomas, Director of Budget, Office of Insular 
      Affairs, Department of the Interior, Washington, DC........     8
        Prepared statement of....................................     9
        Questions submitted for the record.......................    10
    Faumuina, Taufete'e John, CEO-Director, Lyndon B. Johnson 
      Tropical Medical Center, Faga'alu, American Samoa..........    11
        Prepared statement of....................................    13
        Questions submitted for the record.......................    14
    Young, Sandra King, Medicaid Director, American Samoa 
      Medicaid Agency, Office of the Governor, Pago Pago, 
      American Samoa.............................................    17
        Prepared statement of....................................    19

Additional Materials Submitted for the Record:
    List of documents submitted for the record retained in the 
      Committee's official files.................................    36
 
OVERSIGHT HEARING ON ASSESSING CURRENT CONDITIONS AND CHALLENGES AT THE 
      LYNDON B. JOHNSON TROPICAL MEDICAL CENTER IN AMERICAN SAMOA

                              ----------                              


                         Tuesday, July 25, 2017

                     U.S. House of Representatives

       Subcommittee on Indian, Insular and Alaska Native Affairs

                     Committee on Natural Resources

                             Washington, DC

                              ----------                              

    The Subcommittee met, pursuant to notice, at 10:04 a.m., in 
room 1324, Longworth House Office Building, Hon. Doug LaMalfa 
[Chairman of the Subcommittee] presiding.
    Present: Representatives LaMalfa, Gonzalez-Colon, 
Radewagen, Bishop; and Sablan.
    Also present: Representative Westerman.
    Mr. LaMalfa. The Subcommittee on Indian, Insular and Alaska 
Native Affairs will come to order. The Subcommittee is meeting 
today to hear testimony on the topic of, ``Assessing Current 
Conditions and Challenges at the Lyndon B. Johnson Tropical 
Medical Center in American Samoa.''
    I ask unanimous consent that the gentleman from Arkansas, 
Mr. Westerman, be allowed to sit in with the Committee and 
participate in the hearing.
    So ordered, without objection.
    Under Committee Rule 4(f), any oral opening statements at 
hearings are limited to the Chairman, the Ranking Minority 
Member, and the Vice Chair. This allows us to hear from our 
witnesses sooner, and helps Members to keep to their schedules. 
Therefore, I ask unanimous consent that all other Members' 
opening statements be made part of the hearing record if they 
are submitted to the Subcommittee Clerk by 5:00 p.m. today.
    Without objection.

    STATEMENT OF THE HON. DOUG LaMALFA, A REPRESENTATIVE IN 
             CONGRESS FROM THE STATE OF CALIFORNIA

    Mr. LaMalfa. Good morning. The Subcommittee is meeting to 
discuss the previously mentioned topic.
    The islands of American Samoa joined the United States 
through Deeds of Cession back in the early 1900s, and thus 
their fate and well-being has been tied to that of our mainland 
for the last 117 years. During that time, American Samoa has 
had its struggles with maintaining and providing healthcare 
services for their growing population.
    In 1966, President Lyndon Johnson gave remarks at the 
Tafuna International Airport in Pago Pago and his remarks 
acknowledged construction of the American Samoa Tropical 
Medical Center, the territory's first and only hospital, 
``which will provide the finest hospital care in this part of 
the world.''
    Unfortunately, the President's hopes for the Tropical 
Medical Center did not come to fruition, as the hospital is in 
a state of disrepair, far below expectations. With this 
deteriorating infrastructure and the strain of rising 
healthcare costs that plague many of America's rural areas, the 
hospital administration is being forced to tackle an expanding 
list of challenges: shortage of qualified medical staff and the 
remoteness of the South Pacific.
    It is, indeed, a struggle to provide this everyday 
treatment that is needed. Many have to journey 5 hours via 
airplane to Hawaii, instead, to receive proper care. The cost 
of travel is a burden for them, and places an incredible 
challenge in meeting these costs.
    Congress has a responsibility to the territories, and to 
review the Federal policies and programs that affect the daily 
lives of the Americans living and working in these far-off 
places.
    The testimony received today will be a crucial step forward 
for Congress to review and better understand how our policies 
are affecting these Americans at the local level in the 
Nation's most remote territories.

    [The prepared statement of Mr. LaMalfa follows:]
Prepared Statement of the Hon. Doug LaMalfa, Chairman, Subcommittee on 
               Indian, Insular and Alaska Native Affairs
    Good Morning. The Subcommittee is meeting today to discuss a topic 
not many Americans are familiar with, in a place not many Americans are 
familiar with, the Lyndon B. Johnson Tropical Medical Center in 
American Samoa.
    The islands of American Samoa joined the United States through 
Deeds of Cession back in the early 1900s and thus their fate and well-
being has been tied to that of our mainland for the last 117 years. 
During that time, American Samoa has had its struggles with maintaining 
and providing healthcare services for their growing population.
    On a visit in 1966, then-President Lyndon Baines Johnson gave 
remarks at Tafuna International Airport in Pago Pago. In his remarks, 
the President acknowledged the construction of the American Samoa 
Tropical Medical Center, the territory's first and only hospital, ``. . 
. which will provide the finest hospital care in this part of the 
world.''
    Unfortunately, the President's hopes for the Tropical Medical 
Center did not come to fruition as the hospital is in a state of 
disrepair, far below expectations. With deteriorating infrastructure 
and the strain of rising healthcare costs that plague many of America's 
most rural areas, the hospital administration is being forced to tackle 
an expanding list of challenges.
    A shortage of qualified medical staff and the remoteness of the 
territory's location in the South Pacific make recruitment of vital 
medical care providers a daunting task. The struggle to provide 
adequate medical treatment is an everyday fight for the hospital's 
limited staff and all too often a futile one, as many patients in need 
of advanced treatment are forced to journey 5 hours via airplane to 
Hawaii in order to receive proper care. The cost of this travel for 
healthcare only continues to overburden both the territory and the 
Federal programs that are in place to cover a portion of these enormous 
costs.
    These challenges are ones that the hospital administration and 
local government cannot possibly tackle on their own and in today's 
hearing we will look at the role the Federal Government has played in 
this partnership and if there are ways for improvements to be made, 
both in infrastructure and under current Federal healthcare programs. 
Congress has a responsibility to the territories and to review the 
Federal policies and programs that affect the daily lives of the 
Americans living and working in these far-off places.
    All too often, it is easy to leave the territories on the fringes 
of our Nation's collective dialogue, and what might seem like minor 
policy changes to folks here living in the mainland United States can 
have very major consequences to those living in our most remote 
districts.
    I thank all the witnesses that made the roughly 7,000 mile journey 
from the South Pacific to be with us here today to share their valuable 
expertise and insight as to the conditions at the LBJ hospital. The 
testimony we receive here today will be a crucial step forward for 
Congress to review and better understand how our Federal policies are 
affecting the Americans at the local level in the Nation's most remote 
territory.

                                 ______
                                 

    Mr. LaMalfa. With that, I would like to yield time to our 
colleague from American Samoa, Mrs. Radewagen.

STATEMENT OF THE HON. AUMUA AMATA COLEMAN RADEWAGEN, A DELEGATE 
        IN CONGRESS FROM THE TERRITORY OF AMERICAN SAMOA

    Mrs. Radewagen. Thank you, Mr. Chairman. I first want to 
thank you and the members of the Committee for holding today's 
hearing. It has been a long time coming, and I am glad to see 
us finally sitting down to tackle this issue that is so 
important to my home district of American Samoa.
    I also want to welcome our witnesses, who have traveled 
halfway around the world to be here, including Taufete'e John 
Faumuina, CEO and Director of the LBJ Tropical Medical Center; 
Dr. Reese Tuato'o--do I see Dr. Reese Tuato'o?; and Sandra King 
Young, Medicaid Director for the territory. Thank you all for 
being here today. Your dedication to your work is much 
appreciated.
    Welcome also to Mr. Tom Bussanich, from the Department of 
the Interior.
    This hearing is the result of the CODEL that traveled to 
American Samoa in February, and I want to thank Chairman Bishop 
and the Members who were able to join us. During the visit, the 
Members were given a tour of LBJ Hospital, the only medical 
treatment facility on the island.
    I want it in the record that our doctors and nurses who 
work there do an excellent job with the limited resources they 
have available, and they should be commended for their efforts 
to maintain the good health of our people.
    LBJ is approximately a 150-bed facility which opened in 
1968 and has since had only minor facelifts, such as new doors 
and fresh paint. The capabilities of the facility have largely 
remained the same.
    Additionally, further adding to the applause we should be 
heaping upon our doctors and nurses is the fact that the 
facility is drastically under-staffed, as getting qualified 
medical personnel to the island has proven to be difficult, an 
issue that I hope we can find a solution to through this 
hearing and the work that will follow.
    The American Samoa Government Operations account, which is 
included in the annual Interior appropriations bill, provides 
approximately $7 million annually for hospital operations. That 
account not only funds a portion of the local hospital, but 
also the local judiciary, the Department of Education and local 
community college--originated in 1974 at an amount of 
approximately $17 million, annually.
    Since then, it has been increased only once, in 1986, to 
$22.75 million a year, where it sits today. And if one were to 
use the standard CPI formula, that amount would now be over $50 
million annually. Again, the hospital's take from this 
appropriation is approximately $7.5 million.
    Compare that to any other facility of the same size here in 
the states, and the gap in equity becomes very clear. For 
example, this year's total budget for LBJ was about $51 
million, while a hospital of the same size in Washington State 
has a 2017 budget of roughly $200 million.
    The people of American Samoa need better access to care 
without having to take a flight. The fact is it is beyond time 
for a significant increase to the account. The reasoning 
provided in DOI's budget report for the lack of any increase to 
the ASG operations account over the years is to promote self-
sufficiency on the island, which is all fine and well, but near 
impossible when, at the same time, the Federal Government has 
closed off large swaths of fishing grounds in the Pacific that 
our people have used for a millennium, and long before any 
relationship with the United States, and at the same time 
imposed federally mandated minimum-wage laws, irresponsibly 
putting the territory, which is both economically and 
geographically isolated, on the same playing field as the 
states.
    Mr. LaMalfa. The gentlelady will have to come back to the 
rest of your statement a little bit later. Our time has 
expired.
    Mrs. Radewagen. Thank you, Mr. Chairman. I yield back.

    [The prepared statement of Mrs. Radewagen follows:]
  Prepared Statement of the Hon. Aumua Amata Radewagen, a Delegate in 
             Congress from the Territory of American Samoa
    Thank you Mr. Chairman. I thank my colleague for yielding her time.
    I first want to thank you and the members of the Committee for 
holding today's hearing. It has been a long time coming, and I am glad 
to see us finally sitting down to tackle this issue that is so 
important to my home district of American Samoa.
    I also want to welcome our witnesses who have traveled halfway 
around the world to be here including: Taufete'e John Faumuina, CEO and 
Director of LBJ Tropical Medical Center; Dr. Reese Tuato'o, Chief of 
Internal Medicine at LBJ; and Tofoitaufa Sandra Young, Medicaid 
Director for the territory. Thank you all for being here today. Your 
dedication to your work is appreciated.
    This hearing is the result of the CODEL that traveled to American 
Samoa in February, and I want to thank Chairman Bishop and those 
Members who were able to join us. During the visit, the Members were 
given a tour of LBJ Hospital, the only medical treatment facility on 
the island. I want it in the record that our doctors and nurses who 
work there do an excellent job with the limited resources they have 
available, and they should be commended for their efforts to maintain 
the good health of our people.
    LBJ is a 150-bed facility which opened in 1968, and has since had 
only minor facelifts, such as new doors and fresh paint. The 
capabilities of the facility have largely remained the same. 
Additionally, further adding to the applause we should be heaping upon 
our doctors and nurses is the fact that the facility is drastically 
under-staffed, as getting qualified medical personnel to the island has 
proven to be difficult, an issue that I hope we can find a solution to 
through this hearing and the work that will follow.
    The American Samoa Government Operations account, which is included 
in the annual Interior appropriations bill, provides approximately $7 
million annually for hospital operations. That account not only funds a 
portion of the local hospital, but also the local judiciary, the 
Department of Education, and local community college--originated in 
1974 at the amount of approximately $17 million annually. Since then, 
it has been increased only once in 1986 to $22.75 million a year where 
it sits today. If one were to use the standard CPI formula, that amount 
would now be over $50 million annually. Again, the hospital's take from 
this appropriation is approximately $7.5 million.
    Compare that to another facility of the same size here in the 
states, and the gap in equity becomes very clear. For example, this 
year's total budget for LBJ was $51 million, while a hospital of the 
same size in Washington State has a 2017 budget of roughly $200 
million. The people of American Samoa need better access to care 
without having to take a flight. The fact is, it is beyond time for a 
significant increase to the account.
    The reasoning provided in DOI's budget report for the lack of any 
increase to the ASG operations account over the years is to ``promote 
self-sufficiency'' on the island, which is all fine and well, but near 
impossible when at the same time, the Federal Government has closed off 
large swaths of fishing grounds in the Pacific that our people have 
used for a millennium, and long before any relationship with the United 
States, and at the same time imposed federally mandated minimum wage 
laws, irresponsibly putting the territory, which is both economically 
and geographically isolated, on the same playing field as the states--a 
policy that has already forced one tuna cannery to leave the island for 
Thailand where they pay their workers a mere fraction of what ours are 
required to pay. I recently introduced legislation to resolve this 
issue, H.R. 3021, the American Samoa Job Protection and Expansion Act, 
and I look forward to seeing congressional action on it.
    Regarding LBJ and any improvements to be made following 
congressional action, I will be introducing a bill shortly that calls 
for a GAO study in partnership with DOI, the VA and HHS to assess the 
feasibility of either a new or updated facility, and I encourage my 
colleagues to support the measure. It is high-time that we here in 
Congress recognize the issues happening in the insular areas, and I am 
encouraged by today's hearing and the action it will bring.
    Again, I want to thank our witnesses for traveling so far to be 
here today. I know that the work they do on the islands is 
indispensable and I know that their testimony will provide even more 
insight into the issues we are facing on the island in regards to 
providing accessible and quality health care for our people. I look 
forward to their testimony and moving forward with some real solutions 
to improve the health care for the people of American Samoa.
    Thank you Mr. Chairman, I yield back.

                                 ______
                                 

    Mr. LaMalfa. Thank you. I would now like to recognize our 
Ranking Member, Mr. Sablan.

    STATEMENT OF THE HON. GREGORIO KILILI CAMACHO SABLAN, A 
DELEGATE IN CONGRESS FROM THE TERRITORY OF THE NORTHERN MARIANA 
                            ISLANDS

    Mr. Sablan. Thank you very much, Mr. Chairman, for agreeing 
to hold this important hearing. I welcome our witnesses, 
particularly those who traveled from American Samoa.

    I had the opportunity to visit the LBJ Tropical Medical 
Center in American Samoa last year, led by Chairman Bishop and 
hosted by my friend, Congresswoman Radewagen. We got a 
firsthand look at the hospital, the deterioration of the 
physical plant, the lack of equipment and supplies, the 
difficulty of hiring and retaining staff. I look forward to 
hearing what ideas our witnesses offer, particularly the Office 
of Insular Affairs, on how we can make sure the people of 
American Samoa get the health care that all Americans have the 
right to and that all of us here in Congress enjoy.

    But American Samoa is not the only insular area struggling 
with health care. As recently as last December, officials at 
the Centers for Medicare and Medicaid Services threatened to 
decertify the Juan F. Luis Hospital and Medical Center in the 
U.S. Virgin Islands, because the hospital failed to meet basic 
Federal standards.
    In my own district, the Northern Marianas, our only 
hospital also faced CMS decertification in 2012. A team from 
the U.S. Public Health Service and funding from other Federal 
agencies came to the rescue and kept the hospital opened. But 
to this day, the hospital has not met all of the standards 
required to lift the threat of decertification.
    And though the problems at the Marianas hospital were of 
long standing, the real catalyst was the decision by the 
Commonwealth government in 2008 to cut off funding and create a 
quasi-independent Commonwealth Healthcare Corporation. The 
corporation has struggled with the costs of delivering 
healthcare services to the people of the Marianas. Half are 
below the Federal poverty line and one-third have no health 
insurance, so patients are often unable to pay for care.
    The only reason the hospital has been able to remain open, 
the corporation's Chief Executive Officer has said, is because 
of the extra Medicaid money that was provided by Obamacare: 
$109 million. As we all know, that extra money runs out at the 
end of Fiscal Year 2019 or earlier, depending on whether the 
Majority repeals Obamacare, as it has promised to do.
    Mr. Chairman, 9 years ago the Inspector General of the 
Department of the Interior issued a report entitled, ``Insular 
Healthcare at the Crossroads to Total Breakdown.'' Insular 
governments were unable to provide comprehensive healthcare 
services to their citizens, the report stated, because of 
shortages of supplies, medicines, specialty physicians, and 
because of inadequate, antiquated, or damaged infrastructure.
    Sadly, little has changed. This is why any replacement of 
Obamacare, which the Majority has promised, must include the 
U.S. insular areas. At a minimum, Medicaid must be available to 
our areas in exactly the same way it is available to every part 
of the country. Beyond that, the federally funded tax credits 
that are being proposed in the Majority's Better Care Act, that 
will provide help to individuals and families to buy private 
insurance, must be available to Americans in American Samoa, 
Guam, the Marianas, and the U.S. Virgin Islands.
    The President has promised ``insurance for all.'' We are 
all waiting.
    I look forward to working with you, Mr. Chairman, and all 
our colleagues, to fulfill the President's promise, and include 
the people of the insular areas fully and equally in our 
national healthcare programs.
    Thank you, and I yield back.

    [The prepared statement of Mr. Sablan follows:]
   Prepared Statement of the Hon. Gregorio Kilili Camacho Sablan, a 
Delegate in Congress from the Territory of the Northern Mariana Islands
    Thank you, Mr. Chairman, for agreeing to hold this important 
hearing. I welcome our witnesses, particularly those who traveled from 
American Samoa.
    I had the opportunity to visit the LBJ Tropical Medical Center in 
American Samoa last year, led by Chairman Bishop and hosted by 
Representative Radewagen. We got a firsthand look at the hospital--the 
deterioration of the physical plant, the lack of equipment and 
supplies, the difficulty of hiring and retaining staff.
    I look forward to hearing what ideas our witnesses offer--
particularly the Office of Insular Affairs--on how we can make sure the 
people of American Samoa get the health care that all Americans have a 
right to and all of us here in Congress enjoy.
    But American Samoa is not the only insular area struggling with 
health care. As recently as last December, officials at the Centers for 
Medicare and Medicaid Services threatened to decertify the Juan Luis 
Hospital in the Virgin Islands, because the hospital failed to meet 
basic Federal standards.
    In my own district, the Marianas, our only hospital also faced 
decertification in 2012. A team from the Public Health Service and 
funding from other Federal agencies came to the rescue and kept the 
hospital open. But, to this day, the hospital has not met all of the 
standards required to lift the threat of decertification.
    Though the problems at the Marianas hospital were of long-standing, 
the real catalyst was the decision by the Commonwealth government in 
2008 to cut off funding and create a quasi-independent Commonwealth 
Healthcare Corporation. The Corporation has struggled to meet the costs 
of delivering healthcare services to the people of the Marianas. Half 
are below the Federal poverty line and one-third have no health 
insurance. So, patients are often unable to pay for care.
    The only reason the hospital has been able to remain open, the 
Corporation's Chief Executive Officer has said, is because of the extra 
Medicaid money that was provided by Obamacare--$109 million. As we all 
know, that extra money runs out at the end of Fiscal Year 2019--or 
earlier depending on whether the Majority repeals Obamacare, as it has 
promised to do.
    Mr. Chairman, 10 years ago the Inspector General of the Department 
of the Interior issued a report entitled: Insular Health Care ``at the 
crossroads to total breakdown.'' Insular governments were unable to 
provide comprehensive healthcare services to their citizens, the report 
stated, because of shortages of supplies, medicines and specialty 
physicians, and because of inadequate, antiquated or damaged 
infrastructure. Sadly, little has changed.
    This is why any replacement of Obamacare, which the Majority has 
promised, must include the U.S. insular areas. At a minimum, Medicaid 
must be available to our areas in exactly the same way it is available 
to every other part of our country.
    Beyond that, the federally-funded tax credits that are being 
proposed in the Majority's Better Care Act--that will provide help to 
individuals and families to buy private insurance--must be available to 
Americans in American Samoa, Guam, the Marianas, and the Virgin 
Islands.

    The President has promised ``insurance for all.'' We are all 
waiting.

    I look forward to working with you, Mr. Chairman and our other 
colleagues, to fulfill the President's promise and include the people 
of the insular areas fully and equally in our national healthcare 
programs. Thank you.

                                 ______
                                 

    Mr. LaMalfa. Thank you, Mr. Sablan. Again, I want to thank 
the witnesses who have made the 7,000-mile journey that you did 
to be here today and provide their expertise. So, let me 
introduce them.
    We have Mr. Thomas Bussanich, Director of Budget at the 
Office of Insular Affairs, Department of the Interior; Mr. 
Taufete'e Faumuina, CEO of the Lyndon B. Johnson Tropical 
Medical Center; and Sandra King Young, a Medicaid Director, 
American Samoa Medicaid Agency, from the Office of the 
Governor.
    Let me remind our witnesses that under our Committee Rules, 
they must have their oral statements limited to 5 minutes, but 
their entire written statement will appear in the hearing 
record.
    Microphones are not automatic, you have to press the button 
to begin. The light will then turn green. When it turns yellow, 
you have 1 minute to go. When it is red, you know what that 
means, I ask you to complete your statement at that point.
    I will also allow the entire panel to testify before 
questioning by our panel up here.
    The Chair will now recognize Mr. Bussanich to testify.
    You have 5 minutes.

 STATEMENT OF THOMAS BUSSANICH, DIRECTOR OF BUDGET, OFFICE OF 
  INSULAR AFFAIRS, DEPARTMENT OF THE INTERIOR, WASHINGTON, DC

    Mr. Bussanich. Mr. Chairman and members of the 
Subcommittee, thank you for the opportunity to speak regarding 
the LBJ Tropical Medical Center, the primary healthcare 
facility in American Samoa.
    The Office of Insular Affairs has been a partner with the 
American Samoa government for many years, providing 
supplemental funding for the operations and renovation of the 
hospital that was beyond the capacity of the local community.
    The American Samoa government is a recipient of the 
significant share of the annual $27.7 million in capital 
infrastructure funding available from the Office of Insular 
Affairs. Historically, American Samoa has received at least 
one-third of the money in infrastructure funds set aside for 
the four flag territories.
    For the American Samoa government, the allocation of its 
capital funds is conditioned on submission of 5-year capital 
improvement plans that outline local priorities for capital 
spending. For many years, American Samoa's top priority was 
health. And, therefore, the LBJ Tropical Medical Center 
received large shares of capital spending.
    In the 5-year CIP plan for 2016 through 2020, priorities 
changed due to the fragility of the territory's main industry, 
tuna canning. The new 5-year plan elevates economic development 
to priority number one, and education to number two. Health is 
bumped to number three. The allocation decisions are made by 
the American Samoa government and are not set by the Office of 
Insular Affairs.
    The LBJ Tropical Medical Center was constructed in the 
1960s. During the past 15 years, CIP funding has been used to 
renovate much of the hospital to bring it into compliance with 
modern hospital standards. Currently, the labor, delivery, and 
surgical wings are under major renovation and expansion. 
Construction is ongoing, and when the renovation project is 
completed in 2020, approximately 60 percent of the hospital's 
physical plant will count as having been rebuilt.
    The Office of Insular Affairs also provides operational 
funding for the LBJ Hospital from the annual American Samoa 
operations grant. In the current fiscal year, the grant totals 
$22.7 million. The actual use of the grant is proposed by the 
American Samoa government, which is using $7.9 million to 
support LBJ in this fiscal year. The remainder of the grant is 
used to support general education--$11.4 million; the community 
college at $1.4 million; and the high court, at $900,000.
    Over the past 15 years, the Office of Insular Affairs has 
provided $132 million in operations funding and $30 million in 
CIP funding for the LBJ Tropical Medical Center. The Department 
of the Interior is proud to have been a partner with the 
American Samoa government in improving LBJ Tropical Medical 
Center. There is a great deal that still needs to be done, and 
we look forward to continuing to work to improve conditions and 
serve the people of American Samoa. Thank you.

    [The prepared statement of Mr. Bussanich follows:]
 Prepared Statement of Thomas Bussanich, Director of Budget, Office of 
              Insular Affairs, Department of the Interior

assessing current conditions and challenges at the lbj tropical medical 
                        center in american samoa

    Chairman LaMalfa, Ranking Member Torres and members of the 
Subcommittee on Indian, Insular and Alaska Native Affairs, thank you 
for the opportunity to speak regarding the LBJ Tropical Medical Center 
in American Samoa.
    The LBJ Tropical Medical Center is the primary healthcare facility 
in American Samoa. The Office of Insular Affairs (OIA) has been a 
partner with the American Samoa government for many years, providing 
supplemental funding for the operations and renovation of the hospital 
that was beyond the capacity of the local community. Although health 
care is not a primary function of OIA, our broad authorities make it 
possible to provide assistance in American Samoa.
    In recent years, the primary goals of OIA has been to ``Create 
Economic Opportunity,'' ``Improve the Quality of Life,'' and ``Promote 
Efficient and Effective Governance'' in the U.S. insular areas. Our 
assistance for the LBJ hospital is in accord with these goals, as we 
provide both operational funding and capital improvement funding to 
help improve health care for the American Samoa community.
                          capital improvements
    American Samoa Government (ASG) is a recipient of a significant 
share of the annual mandatory $27.72 million in capital infrastructure 
funding available from the Office of Insular Affairs. Historically, 
American Samoa has received at least one-third of the $27.72 million in 
infrastructure funds set aside for the four smaller territories.


 
 
 
              2012                        $10,089,000
              2013                         $9,964,000
              2014                        $10,047,000
              2015                         $9,297,000
              2016                         $9,505,000
              2017                         $9,613,000
              2018 (request)              $10,321,000
 


    For the ASG, its allocation of capital improvement funds is 
conditioned on submission of 5-year capital improvement project (CIP) 
plans that outline local priorities for capital spending. For many 
years, American Samoa's top priority was health and therefore the LBJ 
Tropical Medical Center received larger shares of capital spending. 
Normally, between 15 and 24 percent of American Samoa's Federal capital 
improvement allotment have been devoted to phased construction at the 
LBJ hospital. In the 5-year CIP plan for 2016 through 2020, ASG 
priorities changed due to the fragility of the territory's main 
industry, tuna canning. The new 5-year plan elevates economic 
development to priority Number one and education to Number two. Health 
was bumped to Number three. The allocation decisions are made by the 
American Samoa government and are not set by the Office of Insular 
Affairs.
    The LBJ Tropical Medical Center was constructed in the 1960s. 
During the past 15 years CIP funding has been used to renovate much of 
the hospital to bring it into compliance with modern hospital 
standards. Currently, the labor, delivery and surgical wings are under 
major renovation and expansion. Construction is ongoing, and when the 
renovation project is completed in 2020, approximately 60 percent of 
the hospital's physical plant will count as having been rebuilt.
    The Office of Insular Affairs also provides operational funding for 
the LBJ hospital from the annual American Samoa Operations Grant. In 
the current fiscal year, the grant totals $22.75 million. The actual 
use of the grant is proposed by the ASG, which is using $7.9 million to 
support LBJ in Fiscal Year 2017. The remainder of the grant is used to 
support general education ($11.4 M), the community college ($1.4 M), 
and the High Court ($.9 M).
    For a quick look at both operations and CIP spending over the past 
15 years, please see below. It shows that the Office Insular Affairs 
has provided $132 million in operations funding and $30 million in CIP 
funding for the LBJ Tropical Medical Center in American Samoa.


------------------------------------------------------------------------
                      Operations                         CIP Funding to
   Fiscal Year      Funding to LBJ      Fiscal Year           LBJ
------------------------------------------------------------------------
        2003          $7,721,000             2003          $1,710,000
        2004          $7,675,938             2004          $2,000,000
        2005          $7,664,000             2005          $1,545,000
        2006         $13,264,000             2006          $1,800,000
        2007         $13,264,000             2007          $1,736,842
        2008         $13,039,906             2008          $1,902,684
        2009          $7,652,000             2009          $1,473,684
        2010          $7,657,000             2010          $2,000,000
        2011          $7,642,000             2011          $7,094,737
        2012          $7,645,000             2012          $1,368,421
        2013          $7,657,000             2013          $2,631,579
        2014          $7,900,000             2014          $2,632,000
        2015          $7,900,000             2015            $168,421
        2016          $7,900,000             2016          $1,789,474
        2017          $7,900,000             2017              TBD
------------------------------------------------------------------------
      TOTAL         $132,481,844           TOTAL          $29,852,842
------------------------------------------------------------------------


    The Department of the Interior is proud to have been a partner with 
the American Samoa government in improving the LBJ Tropical Medical 
Center. There is a great deal that still needs to be done and we look 
forward to continuing the work to improve conditions and serve the 
people of American Samoa.

                                 ______
                                 

Questions Submitted for the Record by Rep. Sablan to Thomas Bussanich, 
   Director of Budget, Office of Insular Affairs, Department of the 
                                Interior

    Question 1. Director Bussanich, as you know, Section 2005 of the 
Affordable Care Act provided a total of $6.3 billion in additional 
Federal funds to the territories. These funds were primarily used to 
augment the islands already meager Medicaid programs. Unfortunately, 
because the funding for the ACA was for budgetary reasons, only for a 
10-year window, the additional Medicaid funding will expire in 2019.

    Has OIA (Office of Insular Affairs) or the IGIA (Interagency Group 
on Insular Areas)--to your knowledge--been working with the Insular 
Areas and their representatives on a strategy for getting these funds 
extended? We know that there is a great deal of focus on the impact 
that the loss of these funds would have on Puerto Rico because of the 
affect it will have on their ability to successfully address their debt 
crisis--but it is no less of a big deal for the other islands as well.

    Answer. Office ofInsular Affairs (OIA) officials have regularly 
discussed the healthcare challenges facing U.S. territories with the 
leadership of the insular areas, as well as within the Interagency 
Group on Insular Areas. OIA is aware of the shortage of resources for 
health care in the territories and would like to find a workable 
solution to address the growing healthcare needs of the territories. 
OIA continues to reach out and work with our colleagues at the 
Department of Health and Human Services (HHS), as the lead agency 
responsible for administering the Medicaid program, and will continue 
to work with HHS in a cooperative manner to reflect the priorities and 
needs of the territories.
    Question 2. According to your statement, the LBJ Medical Center has 
received almost $30 million in CIP funding from OIA since 2003. Broadly 
speaking, can you tell us what these have primarily been used for?

    Answer. Please see the following listing of Capital Improvement 
Project grants relating to the LBJ Hospital.

                                 *****
                                 
                                 
   
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
                              
                                 
                                 
                                  

    Mr. LaMalfa. Thank you.
    The Chair will now recognize Mr. Faumuina to testify.

 STATEMENT OF TAUFETE'E JOHN FAUMUINA, CEO-DIRECTOR, LYNDON B. 
   JOHNSON TROPICAL MEDICAL CENTER, FAGA'ALU, AMERICAN SAMOA

    Mr. Faumuina. Thank you for the opportunity to provide 
testimony on assessing current conditions and challenges at the 
Lyndon B. Johnson Tropical Medical Center in American Samoa. I 
am Taufete'e John Faumuina, the Chief Executive Officer of the 
LBJ Tropical Medical Center. I would like to also thank the 
congressional delegation, CODEL, who visited American Samoa 
earlier this year, and had the chance to tour our hospital 
facility.
    In 1968, LBJ opened its doors to provide patient-focused, 
comprehensive, high-quality, and cost-effective health care and 
related services that addressed the health needs of the people. 
LBJ is the sole hospital providing tertiary services to all of 
American Samoa, with a population over 60,000. In order for LBJ 
to keep its doors open, we need to retain Medicare 
certification through CMS. We must comply to the conditions of 
participation.
    My testimony will focus this morning on four main areas of 
the challenges and needs of our hospital.
    First, compliance with CMS standards. LBJ needs to adopt a 
suitable budget to address all non-compliance issues pertaining 
to medical staffing, nursing staffing, ancillary services, and 
supporting services across the board to meet the standard of 
care. The need to comply comes with substantial financial 
commitment, offer better compensations to recruit qualified 
doctors, nurses, certified technicians, and supporting staff, 
assign appropriate budget to properly provide maintenance for 
the aging facility, and schedule preventative maintenance and 
repairs for all equipment.
    Second, staffing inequities and workforce development. With 
LBJ's 150 beds, we require 95 physicians; we only have 57. We 
are required to have 110 RNs; we only have 73. We are required 
to have 11 pharmacists; we only have 3. With the radiology 
department, we must contract off island services to read our 
diagnostics. We do not have a permanent radiologist. We also 
contract a nephrologist who visits American Samoa quarterly to 
treat the 167 patients with 36 staff to handle a workload of 
1,900 treatments per month.
    Third, our healthcare facilities. We have struggled to 
upkeep the aging facility, acquire new equipment, and to 
provide continuous preventative maintenance and repairs. We are 
grateful for the CIP funding from DOI that has allowed LBJ to 
conduct minor and major renovations to address CMS 
infrastructure citations.
    Presently, 41 percent of the facility has been renovated to 
meet CMS standards. Upon completion of the current labor/
delivery nursery expansion and renovation project, our facility 
will be 65 percent renovated. We continue to face the challenge 
of increased outpatient visits and high inpatient census. One 
of the solutions that we are presently exploring is a new 200-
bed hospital to accommodate increase in population, as well as 
inpatient and outpatient visits. Space in the present location 
is severely limited, and we are unable to expand the existing 
building which, in turn, limits services.
    And fourth, our financial conditions--our annual budget 
appropriations are quite inadequate. We need to increase 
Federal appropriations, explore other revenue sources, lifting 
the cap on Medicaid, restructure FMAP percentage favorable to 
American Samoa, and extend the expiration of the ACA funds 
beyond 2019.
    We want to thank you for this rare opportunity given to us. 
We are humbled and extremely grateful to be able to share our 
challenges and needs with this honorable Subcommittee. And we 
hope for your favorable considerations to agree to fund a new 
hospital that will meet all quality of care. [Speaking native 
language.]

    [The prepared statement of Mr. Faumuina follows:]
   Prepared Statement of Taufete'e John P. Faumuina, Chief Executive 
           Officer, Lyndon B. Johnson Tropical Medical Center
    Mr. Chairman and members of the Subcommittee on Indian, Insular and 
Alaska Native Affairs,
    Talofa lava ma fa'afetai lava. Thank you for the opportunity to 
provide testimony on, ``Assessing Current Conditions and Challenges at 
the Lyndon B. Johnson Tropical Medical Center in American Samoa.''
    I am Taufete'e John Faumuina. I am the Chief Executive Officer 
(CEO) of the American Samoa Medical Center Authority doing business as 
Lyndon B. Johnson Tropical Medical Center (LBJTMC) in the U.S. 
Territory of American Samoa.
    I would like to thank the Congress Delegates (CODEL) who visited 
American Samoa earlier this year and had the chance to tour our 
hospital facility. They dialogued with our staff about the limitations, 
woes and tribulations we face in providing quality and safe patient 
care to the people of our islands.
    In 1968, LBJ opened its doors to provide patient focused, 
comprehensive, high quality, and cost effective health care and related 
services that address the health needs of the people. LBJ is the sole 
hospital providing tertiary services to all of American Samoa with a 
population over 60,000. In order for LBJ to keep its doors open we need 
to retain Medicare certification through the Centers for Medicare & 
Medicaid Services (CMS), we must comply with the Conditions of 
Participations.
    My testimony will focus on four main areas of the challenges and 
needs of our hospital.
                               challenges
Compliance with CMS Standards

     LBJ needs to adopt a suitable budget to address all 
            noncompliance issues pertaining to medical staffing, 
            nursing staffing, ancillary services and supporting 
            services across the board to meet the standard of care. The 
            need to comply comes with substantial financial commitment, 
            offer better compensations to recruit qualified Doctors, 
            Nurses, Certified Technicians and supporting staff. Assign 
            appropriate budget to properly provide maintenance for the 
            aging facility and scheduled preventative maintenance and 
            repairs for all equipment. For the record, LBJ is currently 
            operating under a $50 million budget to sustain and provide 
            the best health care for the people of American Samoa.

Staffing Inequities and Workforce Development

     With LBJ's 147 beds, we require 95 physicians, we only 
            have 57. We are required to have 110 RNs, we only have 73. 
            We are required to have 11 pharmacists, but we only have 3.

     With the radiology department, we must contract off-island 
            services to read our diagnostics. We do not have a 
            permanent radiologist.

     We also contract a nephrologist who visits American Samoa 
            quarterly to treat the 167 patients with 36 staff to handle 
            a workload of 1,900 treatments per month.

Healthcare Facilities

     Struggle to upkeep aging facility and acquire new 
            equipment and to provide continuous preventative 
            maintenance and repairs.

     We are grateful for the CIP funding from DOI that has 
            allowed LBJ to conduct minor and major renovations, to 
            address CMS infrastructure citations. The laboratory was 
            expanded and renovated to provide proper space for new 
            diagnostic lab equipment to accommodate the increase types 
            of testing for patient care. The Diagnostic Imaging-
            Radiology Department was expanded and renovated to house 
            more modern equipment such as the radiographic x-ray 
            machines, CT scans, C-arm X-rays, portable x-rays, etc.

     Presently, 41 percent of the facility has been renovated 
            to meet CMS standards. Upon completion of the current 
            Labor/Delivery Nursery expansion and renovation project, 
            our facility will be 65 percent renovated.

     With the completed expansion and extensions of existing 
            infrastructure, we are still struggling to cut down on 
            patient waiting time in ER and Clinical Services because of 
            the overwhelming number of patient visits, with ER seeing 
            an average of over 2,500 visits per month. Patient 
            admission process is also delayed due to overflow and non-
            availability of beds in the wards because of constant high 
            census.

     One of the solutions that we are presently exploring is a 
            new 200-bed hospital to accommodate increase in population, 
            as well as inpatient and outpatient visits. Space in the 
            present location is severely limited, and we are unable to 
            expand the existing building which in turn limits services.

Financials

     Annual Budget--Inadequate appropriation

            -- Increased Federal appropriation

            -- Explore other revenue sources

     Lifting the cap on Medicaid

     Restructure FMAP percentage favorable to American Samoa

     Extend the expiration of ACA funds

                               conclusion
    We want to thank you for this rare opportunity given to us. We are 
humbled and extremely grateful to be able to share our challenges and 
needs with this honorable Subcommittee, and we hope for your favorable 
consideration to our plea to fund a new hospital that will meet all 
quality of care.

    Faafetai ma le faaaloalo lava. SOIFUA!

                                 ______
                                 

  Questions Submitted for the Record by Rep. Sablan to Taufete'e John 
   Faumuina, CEO-Director, Lyndon B. Johnson Tropical Medical Center

    Question 1. LBJ hospital is subject to certain standards and 
regulations mandated by CMS, the Centers for Medicare and Medicaid 
Services. You mentioned that ``these Federal mandates place constraints 
and difficulties'' on your operations, even though you welcome CMS' 
participation. Can you elaborate on those constraints? What are your 
biggest obstacle to addressing them--is it adequate funding?

    Answer. The Lyndon B. Johnson Tropical Medical Center (LBJTMC) in 
American Samoa presently and continuously embraces CMS' Conditions of 
Participation (CoP) for our hospital to retain its eligibility for 
Medicare certification. To receive Medicare/Medicaid payment, hospitals 
are required to be in compliance with the Federal requirements set 
forth in the Medicare CoP. As the sole hospital in American Samoa, 
without this Medicare certification to operate, LBJTMC will not be able 
to fulfill its critical role in providing access to essential acute 
care services to the residents of American Samoa. Although we continue 
to face obstacles, difficulties and constraints meeting the CoPs set 
forth by CMS, but these requirements are what improve our standards of 
practice and allow us to offer quality and safe patient care to our 
people. We recognize the value as recipients of CMS.

    I will elaborate more on some of the constraints and difficulties 
on the operation of our hospital. Please note the following four main 
areas of my written testimony from the July 25, 2017 hearing:

  1.  Compliance with CMS Standards

  2.  Staffing Inequities and Workforce Development

  3.  Healthcare Facilities

  4.  Financials

1. COMPLIANCE WITH CMS STANDARDS

Over the years, LBJ has faced continuous difficulties to be compliant 
with the requirements as a provider of services with the Medicare 
Program established under Title XVIII of the Social Security Act. 
However, we will continue to strive toward improvement as required by 
CMS CoPs. In the last year, the recent challenges we have faced with 
compliance are:

     In June 2014, we were documented non-compliance with nine 
            (9) CoPs.

     A Medicare revisit survey on December 2015, documented 
            nine (9) non-compliance CoPs.

     During our last revisit survey on January 27, 2017, with 
            financial reserve and resources committed into operations, 
            CMS identified six (6) areas of substantial non-compliance 
            for LBJ. These deficiencies have an impact on the integral 
            function of the four main areas identified in our written 
            testimony.

2. STAFFING INEQUITIES AND WORKFORCE DEVELOPMENT

For staffing, human resources and workforce development, adequate 
staffing is required as part of CMS CoPs, yet we continue to experience 
staff shortages hospital-wide due to various reasons. Some causes for 
this inadequacy of staffing are: our inability to offer competitive 
salaries; our isolated and geographical location; our ability to 
recruit and retain; or lack of local pool of qualified, certified or 
credentialed prospects in American Samoa. The following critical areas 
continue to be a challenge to employ such as, but not limited to:

     Medical Staff

            -- On-site Radiologist

            -- Nephrologists

            -- Physicians

     Nursing Department/Patient Care

            -- Advanced Practice Nurses

            -- Anesthetist Nurses

     Ancillary

            -- Respiratory Therapist

            -- Occupational/Physical Therapist

            -- Registered Dietitian

            -- Medical Laboratory Technologist

     Other professionals such as:

            -- Infection Preventionist

            -- Health Information Technologist

            -- Bio-med Technicians

3. HEALTHCARE FACILITIES

As you may recall, this hospital was built in 1968 without the 
specification or mandates to meet CMS standards and life safety codes. 
While most hospitals in the United States currently have an ``average 
age of plant,'' of just less than eleven (11) years, LBJTMC is well 
over 50 years old. The routine and preventive maintenance; safety and 
testing activities are all part of CoPs for CMS. Maintaining the 
hospital throughout the years has been extremely costly.

Although considered modern and state-of-the art at the time it was 
built, LBJ was not envisioned and constructed with CMS standards. As a 
result, it has become extremely costly to be in compliance with CMS 
Conditions of Participation. Therefore, understandably, to continue to 
provide quality healthcare services and be in compliance with CMS, a 
new hospital would be the most cost effective solution. CoP also 
requires that the LBJ hospital be constructed, arranged and maintained 
to ensure the safety of the patient and quality of care.
4. FINANCIALS

As depicted in our testimony, one of our continuous challenges and 
biggest obstacle in addressing our difficulties and constraints is 
funding. Many of the CMS CoPs require constant upgrades of facilities, 
increase of medical services, costs of resources to recruit and retain 
qualified professionals and overall hospital operations which all 
require financial support.

    Question 2. You mentioned that 35 percent of your pharmaceutical 
budget is for dialysis medications. What is the percentage of your 
overall budget is for medications? And, since American Samoa is outside 
the customs area of the United States are you able to purchase drugs 
internationally, which should provide savings over U.S. sourced drugs?

    Answer. The hospital's budget for FY2016 was $46 million. The LBJ 
pharmacy's pharmaceutical budget for FY2016 was $5.9 million which is 
approximately 12 percent of the overall hospital budget. In our report, 
35 percent or approximately $2.06 million of pharmaceutical budget was 
spent for our dialysis population in FY2016.
    Although, American Samoa is outside of the U.S. customs area, we 
cannot purchase pharmaceutical drugs internationally or from foreign 
manufacturers as LBJTMC is regulated by the Centers of Medicaid and 
Medicare (CMS). The LBJ pharmacy accesses the VA Federal Supply 
Schedule (FSS) and PRxO Generic (Pharmacy Prescription Generic 
Contract) contract pricing with our pharmaceutical vendor, 
AmerisourceBergen Wholesaler (ABC), a U.S. distributor. By using the 
FSS program, which is available to Federal and state government, we are 
able to procure our pharmaceutical products at a lower cost and 
affordability therefore providing savings and best value for our 
dollars.
    Also, we reached out to the pharmacy department at the Commonwealth 
Healthcare Corp (CHCC), Commonwealth of Northern Marianas Islands 
(CNMI) hospital to explore opportunities we could share as U.S. 
territories. Yet, we learned that we face similar deficiencies in 
meeting CMS mandates and difficulties in procuring and maintaining an 
inventory level especially with drugs listed on the national shortage. 
Furthermore, as regulated by CMS, all of CNMI's pharmaceuticals have to 
meet FDA rules and they also procure their drugs through Mckesson 
Wholesaler, a U.S. distributor.
    As mentioned above, LBJTMC is regulated by the Centers for Medicaid 
and Medicare (CMS) and only FDA-approved medications are eligible for 
reimbursements. For patient safety, FDA's current position on the 
importation of prescription drugs from foreign entities or unknown 
sources cannot ensure the safety and effectiveness of products. These 
unknowns put patient's health at risk if they cannot be sure of the 
products identity, purity and source, therefore, FDA recommends ONLY 
obtaining medicines from legal sources in the United States. Drugs sold 
in the United States also must have proper labeling that conforms to 
the FDA's requirements, and must be made in accordance with good 
manufacturing practices. As part of the FDA's high standards, drugs can 
be manufactured only at plants registered with the agency, whether 
those facilities are domestic or foreign. If a foreign firm is listed 
as a manufacturer or supplier of a drug's ingredient on a new drug 
application, the FDA generally travels to that site to inspect it.

    Here are some of the additional reasons why we cannot purchase from 
international manufacturers:

  1.  LBJ participates in the Medicaid Drug Rebate Program to help 
            subsidize the cost of medication for the territory. This 
            program includes CMS, State Medicaid Agencies and 
            participating drug manufacturers that help to offset the 
            Federal and state costs of most outpatient prescription 
            drugs dispensed to Medicaid patients.

              Approximately 600 drug manufacturers participate 
        in this program (all U.S.-based drug companies).

              Only FDA-approved medications are eligible for 
        the Federal Medicaid drug rebate reimbursement program.

  2.  Benefits of a Closed System

              Under the Food Drug & Cosmetic (FD&C) Act, the 
        interstate shipment of any prescription drug that lacks 
        required FDA approval is illegal. Interstate shipment includes 
        importation--bringing drugs from a foreign country into the 
        United States.

  3.  FDB (first databank) provides patient safety medication for FDA-
            approved medications ONLY

              Hospital advantage with offered programs 
        including drug-drug interactions, drug-allergy, drug-disease 
        interactions and duplicate therapy flags.

              Electronic Health Record and prescription labels 
        are linked with FDB to incorporate all essential medication 
        information for both patients and health professionals alike.

  4.  Early 2017--Drug Importation Bill being proposed to allow U.S. 
            pharmacies to purchase medications from Canada (see details 
            below)--has not passed yet, and when it does, it will 
            definitely provide another avenue to procure medication if 
            it is cost-effective.

              The Affordable and Safe Prescription Drug 
        Importation Act would instruct the Secretary of Health and 
        Human Services, within 180 days after enactment of this Act, to 
        issue regulations allowing wholesalers, licensed U.S. 
        pharmacies, and individuals to import qualifying prescription 
        drugs manufactured at FDA-inspected facilities from licensed 
        Canadian sellers. After 2 years, the Secretary would have the 
        authority to permit importation from countries in the 
        Organization for Economic Co-operation and Development (OECD) 
        that meet specified statutory or regulatory standards that are 
        comparable to U.S. standards.

    Question 3. You indicate that the LBJ pharmacy is constantly faced 
with severe shortages of critical drugs and that because LBJ is the 
only hospital in American Samoa; you do not have the capability of 
reaching out to another facility to procure or acquire essential 
lifesaving drugs. What about the America Samoa VA clinic named after 
our former colleague Eni Faleomavaega? Do they have a pharmacy on site 
that you can utilize to obtain critical drugs?

    Answer. This option has been already been explored by LBJ Pharmacy. 
At present, the Faleomavaega Fa'aua'a Hunkin Clinic does not have a 
pharmacy on site. The essential lifesaving drugs mentioned in our July 
25, 2017, written response are the critical medications used in our 
hospital and intensive care units for patients who are in their 
critical stages and on life sustaining measures.
    On the VA Pacific Island Health Care System website, the 
``Faleomavaega Fa'aua'a Hunkin Community Based Outpatient Clinic in 
American Samoa is to provide primary health care to eligible veterans. 
It is a non-emergent care for veterans with stable chronic health 
problems or minor acute illnesses. It is NOT equipped to provide 
emergency services, and veterans shall seek treatment to Lyndon B. 
Johnson Medical Center for emergency services.''
    The clinic ONLY stocks emergency medications in their crash carts 
to use in emergency resuscitations for life support. All of the 
military retirees and veterans' pharmaceutical needs and their 
prescriptions are sent from the VA hospital in Honolulu, Hawaii.

    Question 4. What will it mean for LBJ if Congress does not to 
extend the 2019 ACA funds?

    Answer. At the current LBJ expenditure rate for Medicaid services, 
we are only able to tap into ACA funds by the third quarter of the 
fiscal year. A new Medicaid methodology for the reimbursement model 
process may be an immediate option to assist LBJ and an extension of 
the ACA 2019 expiration date. Our current Medicaid state plan 
methodology severely limits our ability to exhaust ACA funds.

    If the U.S. Congress does not extend the 2019 Affordable Care Act 
(ACA) funds expiration date, American Samoa stands the chance to lose 
out on optimizing opportunities to assist with a healthcare safety net 
to:

  1.  Insure the medically vulnerable people of American Samoa's low-
            income adults and children;

  2.  To fund long-term services and support for adults and children 
            with serious disabilities or illnesses who are at risk of 
            impoverishment as a result of their health.

                                 ______
                                 

    Mr. LaMalfa. Thank you, Mr. Faumuina.
    Let's now recognize Ms. Young for 5 minutes.
    Thank you.

  STATEMENT OF SANDRA KING YOUNG, MEDICAID DIRECTOR, AMERICAN 
   SAMOA MEDICAID AGENCY, OFFICE OF THE GOVERNOR, PAGO PAGO, 
                         AMERICAN SAMOA

    Ms. Young. Thank you.
    [Speaking native language]
    Chairman LaMalfa, Ranking Member Sablan, and members of the 
Committee. Thank you for the opportunity to present testimony 
regarding the LBJ Hospital and the role the American Samoa 
Medicaid program plays in our healthcare system.
    Medicaid is a very complicated Federal-State program, as it 
is administered in American Samoa. The American Samoa Medicaid 
program has remained unchanged, in terms of provider 
eligibility and coverage, over its 35-year history, until the 
Lolo administration.
    Unlike other states and territories, Medicaid is the only 
publicly available health insurance provider in our territory. 
And the LBJ Hospital has been the only Medicaid provider until 
this year.
    Because Medicaid is a state-specific health plan, once we 
leave our territory we are no longer covered with a health 
insurance plan, should any medical emergency befall us, like 
when we are here for this hearing in DC.
    As the Medicaid Director, my responsibility is to ensure 
that our Medicaid beneficiaries, the people of American Samoa, 
have access to medical services, as required under the Social 
Security Act. When it comes to challenges that our hospital 
faces, the Medicaid agency is most concerned about the 
hospital's compliance with the Centers for Medicare and 
Medicaid Services, conditions of participation, and compliance 
under the American Samoa Medicaid State Plan.
    Non-compliance puts at risk Medicare and Medicaid funding 
for the LBJ Hospital. The biggest help that LBJ needs to ensure 
compliance is the construction of a new hospital. Thus, we 
respectfully recommend that the Committee should introduce 
authorizing legislation to provide funding for the construction 
of a new hospital for American Samoa.
    American Samoa has already secured a potential site for 
this construction. The LBJ Hospital is a 50-year-old facility, 
and it sustained major damage in a 2009 earthquake and tsunami. 
While the facility was repaired after the tsunami, the hospital 
continues to struggle with infrastructure standards to maintain 
CMS certification. It would be more cost-effective to replace 
the current facility so that it meets the modern standards for 
CMS conditions of participation under a new hospital facility.
    In terms of Medicaid funding, the priority of the Lolo 
administration and of the territory is to maintain the Medicaid 
revenue stream that helps support the LBJ and our entire 
healthcare system. Prior to the passage of the Affordable Care 
Act in 2011, the LBJ Hospital was insolvent and continually 
went into debt to keep the hospital in operation and maintain 
needed medical services.
    The Medicaid funds under ACA helped to fully fund the 
Federal share of the Medicaid program. But, unfortunately, the 
expiration of these funds in 2019 weighs heavily over the 
territory. The American Samoa Medicaid Agency spent the last 3 
years working with CMS to amend our state Medicaid plan to 
expand our Medicaid provider network. This year we received 
approval to make the federally qualified health centers a 
provider, and to enable the off-island medical referral 
services to be re-instated directly with off-island providers 
through our agency.
    Access to the ACA Medicaid funds is critical to fully 
implement the Medicaid state plan. If the time to expand the 
Medicaid funds provided for in the ACA is not extended, this 
would cripple our LBJ Hospital and the rest of our healthcare 
system, potentially forcing the territory to cut or suspend 
medical services all together.
    Looking long-term, after ACA funds are expended, it is 
necessary to increase the annual Medicaid block grant for 
American Samoa in order to adequately sustain the provision of 
medical services, as required under the Social Security Act.
    Thank you again for this auspicious opportunity to testify, 
and I am happy to take questions from the Committee.

    [The prepared statement of Ms. Young follows:]
   Prepared Statement of Sandra King Young, American Samoa Medicaid 
                                Director
    Chairman LaMalfa, Ranking Member Torres and members of the 
Subcommittee, on behalf of American Samoa, I am honored to present 
testimony regarding our unique Medicaid program. Thank you for this 
prodigious opportunity to share with you the unique features of the 
Medicaid program in American Samoa.
    American Samoa was granted a 1902(j) waiver in 1983 to administer a 
Presumptive Eligibility model for the Medicaid Program. Under this 
waiver, American Samoa is the only U.S. jurisdiction where there is no 
eligibility and enrollment of individual beneficiaries. Beneficiaries 
are presumed eligible for Medicaid if they fall within the 200 percent 
U.S. Federal poverty level.
    In terms of Medicaid funds and its relation to LBJ hospital, the 
priority of the Lolo administration and of the territory, is to 
maintain the Medicaid revenue stream that helps support the LBJ and our 
whole healthcare system. First, the deadline to expend the Medicaid 
funds under ACA must be extended to allow American Samoa to increase 
access to medical services for beneficiaries. Second, we must have an 
increase of $15 million a year in the regular Medicaid block grant 
funds under the Social Security Act regardless of what happens to the 
ACA Medicaid funds. This will allow the Medicaid agency to adequately 
fund the needs of the American Samoa Medicaid program and avert the 
reduction or suspension of medical care services. If ACA is repealed or 
replaced without this increase in the regular Medicaid grant, the 
consequences would be devastating to the local government and our local 
economy, but most of all, it will cripple the LBJ hospital and our 
healthcare system so as to deny access to medical care for our people.
    One of the most significant challenges that the hospital faces is 
the chronic deficiencies with CMS Survey and Certification putting at 
risk its Medicare and Medicaid funding. The LBJ hospital was built in 
1968 and is located in a tsunami zone and sustained major damage during 
the 2009 tsunami. American Samoa needs a modern hospital outside of the 
tsunami zone. Continuing to do band aid solutions to renovate the 50-
year old LBJ hospital is not cost effective. American Samoa needs from 
Congress an appropriation of $200 million for a state-of-the-art 
hospital that would be fully compliant with Medicare Conditions of 
Participation and CMS standards for infrastructure.
    The Lyndon B. Johnson Tropical Medical Center has been the only 
Medicaid provider on island, until February 2017 when the American 
Samoa Department of Health's Federally Qualified Health Center (FQHC) 
became the second Medicaid provider in the 35-year history of the 
program. The 1902(j) waiver under the Social Security Act gives the 
American Samoa Medicaid agency flexibility to waive Federal regulations 
that are inappropriate and not relevant for its small Medicaid program. 
It however, cannot waive three things: (1) the Medicaid cap funding, 
(2) the Federal Medicaid Assistance Percentages (FMAP) for local and 
Federal match requirements, and (3) the mandatory health services 
required under the Social Security Act. All three of these provisions 
create inconsistent Federal objectives because (1) and (2) limit 
funding for American Samoa thus making number (3) unachievable. In 
essence, number (3) becomes an unfunded mandate that the American Samoa 
Medicaid program cannot comply with because of inadequate funding. 
Unlike the states unlimited access to Medicaid funds, American Samoa 
and the territories Medicaid programs operate as a capped block grant. 
Further, the FMAP percentage match rate was imposed arbitrarily on all 
five U.S. territories--45 percent local/55 percent Federal--and 
equivalent to the matching rates of wealthy states like California and 
Connecticut. By the third quarter of the fiscal year, American Samoa 
generally exhausts the territory's regular Medicaid funds under the 
Social Security Act.
    The passage of the Affordable Care Act in 2011 provided an 
additional $181 million in Medicaid funding for American Samoa plus an 
additional $16 million intended for an insurance marketplace. American 
Samoa was not able to establish an insurance marketplace because it 
does not have health insurance providers on the island--except for 
Medicaid. The $16 million was added to the ACA Medicaid funds for a 
total of $197 million for American Samoa. The territory benefited from 
the additional Medicaid funds and the shortfall of the regular annual 
Medicaid block grant was now covered by the ACA Medicaid funds. 
Unfortunately, the 2019 deadline to expend the ACA Medicaid funds was 
not rationale. The ACA was passed with no input from American Samoa, 
for us to explain that simply setting aside so much Medicaid funds with 
a deadline for expenditure by 2019 was not logical, as American Samoa 
only had one Medicaid provider. The LBJ provides limited medical 
services to a small population. Like any health insurance plan, 
Medicaid can only reimburse for allowable medical expenses that are 
actually incurred by patients seeking treatment at a hospital. Since 
ACA, the LBJ hospital remains the only provider on island that can 
expend Medicaid dollars, until our local government can appropriate 
local funds for our new providers.
    The Medicaid agency does not expend Medicaid dollars but ensures 
that medical care costs are allowable and that funds for reimbursement 
of that care are disbursed to the healthcare providers--in this case 
LBJ--in a timely manner. Since ACA, LBJ has only been able to draw on 
average an additional $5 million dollars from the ACA account. In 2016, 
the LBJ hospital was able to draw $6 million. If we trend the LBJ's 
annual expenditures of ACA Medicaid funds, with a beginning balance of 
$197 million and an average draw of $5 million a year, it will take LBJ 
39 years to draw all of the ACA Medicaid funds. To date our territory 
has only been able to draw about 20 percent of the ACA Medicaid funds 
because of our limited medical services. It is not possible for the LBJ 
to draw all the ACA Medicaid funds by 2019 without additional services 
or an expanded provider network. There are options that the Medicaid 
agency has successfully pursued to increase access to medical care that 
would be covered by the ACA Medicaid funds.
    The Medicaid agency after nearly years of development and 
negotiations, submitted two major amendments to CMS to change our 
Medicaid state plan. The priority was to enable the Department of 
Health's FQHC to become a provider. This was approved February 2017. 
The second was the Off-Island Medical Referral program that the LBJ 
hospital could not implement due to cash-flow problems. This was 
approved recently in June. The Medicaid agency is waiting for the local 
budget process to be completed and should the agency receive local 
match funds, it will be able to draw down ACA Medicaid funds to 
reimburse the FQHC and providers of the Off-Island Medical Referral 
program.
    The Children's Health Insurance Program (CHIP) is up for 
reauthorization and is an instrumental part of the funding that 
supports the health of the most vulnerable of our population--our 
children. We strongly support the reauthorization of this bill and 
further request that the cap on CHIP funding for the territories also 
be lifted.
    I wish to thank you Chairman LaMalfa and the Subcommittee for this 
opportunity. Thank you also to our Representative Radewagen and the 
Representatives from all the U.S. territories for their support to 
strengthen Medicaid for the territories. It is not lost on me the 
importance of this opportunity to appear before this Committee and the 
attention being afforded to our small island territories. I am most 
grateful.

    Thank you very much. Fa'afetai tele lava.

                                 ______
                                 

    Mr. LaMalfa. Thank you, Ms. Young. And I want to thank, 
again, the panel for your testimony. I will remind the Members 
that Committee Rule 3(d) imposes a 5-minute limit on questions 
by the Members.
    The Chairman will now recognize Members for questions. I 
will first recognize myself for 5 minutes.
    Let me direct this to Mr. Bussanich. You spoke of promoting 
the efficient and effective governments in all island areas, 
and then, as it applies to American Samoa and the hospital.
    It is designated as a high-risk grantee. So, requirements 
of these grantees to comply with special conditions for future 
or existing grants. How, so far, has this designation improved 
the accountability for Federal funds so that we know that 
further investment will be a positive?
    Mr. Bussanich. Well, the high-risk designation, it sends 
signals in both directions. It sends a signal to the local 
government that it needs to focus on improvements in financial 
management and practices, and it does serve, to a certain 
extent, I would suppose, as a warning. But, certainly, it is a 
warning to Federal agencies and others to make sure that the 
funds that they are granting are reported on and used 
appropriately.
    I do think, though, in our case, we have done a lot of 
focus on working on audits, improving the outcomes of audits, 
and we are also aware that a recent Subcommittee report is also 
focusing on this issue.
    We certainly believe that American Samoa has the ability to 
make the improvements to get itself off the high-risk 
designation list.
    Mr. LaMalfa. Do you see this designation being revisited 
any time soon?
    Mr. Bussanich. Yes. It is revisited, certainly, every year.
    Mr. LaMalfa. Every year?
    Mr. Bussanich. Yes.
    Mr. LaMalfa. So, a new, comprehensive look at how 
performance is going, and----
    Mr. Bussanich. Yes. And a lot of that depends on the 
contents of the annual single audits, which----
    Mr. LaMalfa. Is there a criteria that is nearly being met 
for the designation to be removed?
    Mr. Bussanich. Beg your pardon, sir?
    Mr. LaMalfa. Is it nearing the point of meeting the 
criteria for the designation to be removed or revised?
    Mr. Bussanich. I believe so, yes. We are certainly 
interested in taking whatever final steps are needed to do 
that.
    Mr. LaMalfa. OK. I would like to yield the balance of my 
time to Mrs. Radewagen for questions.
    Mrs. Radewagen. Thank you, Mr. Chairman. I wondered if I 
might complete my opening statement, since we had a difference 
of opinion as to the time limit.
    As I was saying, for example, this year's total budget for 
LBJ was $51 million, while the hospital of the same size in 
Washington State has a 2017 budget of roughly $200 million.
    The people of American Samoa need better access to care 
without having to take an airplane off-island. The fact is, it 
is beyond time for a significant increase to the account.
    The reasoning provided in DOI's budget report for the lack 
of any increase to the ASG operations account over the years is 
to promote self-sufficiency on the island, which is all fine 
and well, but near impossible when, at the same time, the 
Federal Government has closed off large swaths of fishing 
grounds in the Pacific that our people have used for a 
millennium, and long before any relationship with the United 
States, and at the same time imposed federally mandated minimum 
wage laws, irresponsibly putting the territory, which is both 
economically and geographically isolated, on the same playing 
field as the states--policy that has already forced one tuna 
cannery to leave the island for Thailand, where they pay their 
workers a mere fraction of what ours are required to pay.
    I recently introduced legislation to resolve this issue: 
H.R. 3021, the American Samoa Job Protection and Expansion Act, 
and I look forward to seeing congressional action on it.
    Regarding LBJ and any improvements to be made following 
congressional action, I will be introducing a bill shortly that 
calls for GAO study, in partnership with DOI, the VA, and HHS 
to assess the feasibility of either a new or updated facility, 
and I encourage my colleagues to support the measure.
    It is high time that we here in Congress recognize the 
issues happening in the insular areas, and I am encouraged by 
today's hearing and the action it will bring. Again, I want to 
thank our witnesses for traveling so far to be here today. I 
know that the work they do in the islands is indispensable, and 
I know that their testimony will provide even more insight into 
the issues we are facing in the islands in regards to providing 
accessible and quality health care for our people.
    Thank you, Mr. Chairman. I yield back my time.
    Mr. LaMalfa. OK, thank you. We will now recognize the 
Ranking Member, Mr. Sablan.
    Mr. Sablan. Well, thank you very much, Mr. Chairman. Let me 
start with Mr. Bussanich.
    According to your statement, the LBJ Medical Center has 
received almost $30 million in CIP funding from OIA since 2003. 
So, broadly speaking, can you tell us what these have primarily 
been used for? Has it been to renovate the facility?
    Mr. Bussanich. Yes, sir, I can. And I can show you a list 
of all the different projects that we have done since 2003.
    But the most significant ones have been a $5 million 
project to upgrade the electrical system. We are in the process 
of a $5.7 million project to improve the labor, delivery, and 
operation room suite. There was $4.7 million spent on a 
forensic psychiatry facility, and $3.2 million on a dialysis 
unit expansion, among other projects. These have been, I think, 
very significant and very useful projects.
    Mr. Sablan. Right, thank you. And could we get that 
information to the Committee, please?
    Mr. Bussanich. Yes, sir.
    Mr. Sablan. I appreciate that, because in a previous 
hearing I made a statement that OIA should re-examine its 
criteria for the capital improvement project funds, and base it 
not on the financial criteria, but basically on the public 
health needs.
    Like, say, for the Northern Marianas, it is the only 
municipality in the Nation that does not have 24/7 water, and 
there is a public health crisis that is growing from that. 
Thank you.
    Ms. Young, if I may, you state also that, to date, our 
territory has only been able to draw 20 percent of the ACA 
Medicaid fund because of our limited medical services. The 
inability to draw down the additional ACA Medicaid funds is not 
unique to American Samoa. The other insular areas, except for 
Puerto Rico, face a similar challenge because of the 55-45 
FMAP.
    In the Marianas, however, the Commonwealth Healthcare 
Corporation, which operates our only hospital, and our Medicaid 
managers have been able to meet the FMAP challenge by using a 
statutorily-recognized Medicaid financial approach known as 
certified public expenditures, or CPEs. And current projections 
show that they are on track to use all or almost all of the 
Marianas' ACA Medicaid funds before the 2019 expiration date. I 
am not an expert on the particulars of CPA accounting, but it 
looks like they are successfully using the ACA money.
    I also understand, according to Medicaid and CHIP, an 
access commission, and a MACPAC, which is a non-partisan 
legislative branch agency that advises Congress, that American 
Samoa uses CPEs for your local match.
    However, I am not sure why you have not been similarly 
successful in certifying the use of public funds to support the 
cost of providing Medicaid-covered services to allow you to 
access more of your ACA Medicaid dollars. Are you familiar with 
the approach the Marianas uses with CPEs to access our ACA 
Medicaid dollars?
    Ms. Young. Thank you, Congressman. Yes, I am. Our 
challenges with drawing down the additional ACA Medicaid funds 
is due to several factors. But the CPE methodology is probably 
not one of them.
    CPE methodology is a very good methodology for our LBJ 
Hospital. The certified public expenditure methodology was 
approved by CMS some years ago, after the hospital had 
significant problems with over-billing. The CPE methodology 
allows the hospital to do a number of things. It stabilizes 
their annual funding, and it also allows them to forecast for 
their budgets.
    The challenges of drawing down the Medicaid money that is 
provided for under ACA is, first, Medicaid dollars can only be 
used to reimburse for allowable medical care expenses.
    Second, our hospital is the only Medicaid provider, and has 
been the only Medicaid provider for 35 years, until this 
February, when the FQHC became a Medicaid provider.
    And third, we don't have enough medical services on island. 
We have not had off-island referral services for the last 10 
years, and that normally has taken wind. It was being 
implemented, normally took up a lot of medical funds from the 
hospital, and it was not sustainable.
    Mr. Sablan. Thank you.
    Mr. Chairman, my time is up.
    Mr. LaMalfa. Thank you. We will now recognize Miss 
Gonzalez, our Vice Chair, for 5 minutes.
    Miss Gonzalez-Colon. Thank you, Mr. Chairman, and thank 
you, the whole panel, for being here today.
    I do understand what you are talking about, because I was 
part of the CODEL that traveled to American Samoa in February 
of this year, and I thank Mrs. Radewagen for making that one of 
the main purposes of the trip. But I have many questions. I 
will try to direct myself.
    Ms. Young, you said in your testimony that a state-of-the-
art replacement hospital in American Samoa will require Federal 
appropriation of $200 million. How do you arrive at this 
figure?
    Ms. Young. That is a number that we have thrown around 
amongst ourselves locally, talking about what it would take to 
build a new hospital on our wish list. But there is no official 
documentation.
    I think that Congresswoman Radewagen has suggested a really 
great idea to do a report with GAO, DOI, and our local 
government to come up with a realistic estimate on how much it 
would take us to build a new hospital.
    Miss Gonzalez-Colon. So, we don't have any support that 
establishes that $200 million as the correct amount, correct?
    Ms. Young. Yes, that is an unofficial estimate that we came 
up with on our own.
    Miss Gonzalez-Colon. Thank you. As part of the territories, 
we face the same situation as Mr. Sablan stated with the 
Medicaid, so we understand what is going on in American Samoa. 
But in our case, we use the money that was allocated in 2012 
with the Obamacare.
    Ms. Young, American Samoa has so much money that remains 
unspent for so long, why? Can you tell us about it?
    Ms. Young. Sure. Since 2011, the hospital has been drawing 
down on the ACA Medicaid money, but just not as much as we 
would like to. Part of that is, like I mentioned earlier, 
Medicaid money can only be used to reimburse allowable medical 
care services.
    And the history of the draw-down--LBJ Hospital is averaging 
about $5 million a year in draw-down. And the Medicaid agency 
can ask for as much money as we need for the LBJ Hospital. But 
through the certified public expenditure payment method, the 
way we pay the hospital is based on the Medicare cost report. 
The Medicare cost report is the financial statement that the 
hospital has to file every year, and it has to be settled and 
finalized by a certified CPA firm, and eventually with CMS.
    Based on that Medicare cost report, we annualize the 
payments for the hospital. Right now, that annual payment 
averages about $1.6 million a month for the hospital. We run it 
through a calculation formula that is approved by CMS within 
our state plan. Usually, the hospital exhausts its regular 
Medicaid funding under the Social Security Act by the third 
quarter. That is a legal requirement. We have to exhaust our 
regular Medicaid funding first, before we can tap into the ACA 
funds.
    Miss Gonzalez-Colon. Question, Ms. Young. How much is 
remaining in that fund?
    Ms. Young. It is approximately about $150 million.
    Miss Gonzalez-Colon. One hundred and fifty? And it was 
allocated at $186 million?
    Ms. Young. I believe it was $181 million, with an 
additional $16 million from the health insurance marketplace.
    Miss Gonzalez-Colon. So, you still have more than $150 
million in that account. In our case, in Puerto Rico, when we 
have those kind of problems, we fix it by making the changes, 
complying with the CMS, to try to get use of that money. I 
encourage American Samoa to do the same in the case you can do 
it.
    Mr. Faumuina, you also touched in your testimony, that in 
your opinion, it will make more sense to replace LBJ entirely, 
rather than attempt to renovate when that facility is still in 
use. Why?
    Mr. Faumuina. The renovation project is carried out in 
order for us to meet CMS standards. Every time they visit, they 
point out deficiencies for us to do certifications of 
participation. So, we are forced to do that.
    Miss Gonzalez-Colon. Thank you, Mr. Chairman. I yield back.
    Mr. LaMalfa. Thank you. We will go ahead and recognize Mrs. 
Radewagen for 5 minutes.
    Mrs. Radewagen. Thank you, Mr. Chairman. You mentioned this 
earlier. My question is for Mr. Bussanich.
    The Chairman mentioned OIA has designated American Samoa as 
a high-risk grantee. And I think you have more or less 
elaborated on how the failure to comply can have this impact on 
securing Federal funding. But providing that the Interior 
appropriations bill that just passed out of Committee gets 
signed into law, we will then see the first increase to the ASG 
operations account since 1986. It is my understanding that the 
bill report recommends that the increase be used to bring ASG 
into Federal compliance.
    Can you assure me, Mr. Bussanich, that OIA will commit to 
working with ASG to use these funds to meet Federal standards?
    Mr. Bussanich. Oh, absolutely. We saw that language and we 
were encouraged by it, as well, to be able to use the funds to 
work with the government to address specific problems to get 
that high-risk designation completely taken off the books.
    Mrs. Radewagen. How does this DOI subsidy work? You folks 
send it, or it is drawn down by ASG, and then you send it down 
to ASG? You don't send it to the hospital directly? Why not?
    Mr. Bussanich. Well, generally, I am just checking to make 
sure. I am not exactly sure where the draw-down goes. But the 
grants are typically made to the government of American Samoa, 
and the Treasury there handles the actual draw-downs.
    The payments are made on a regular basis, according to a 
schedule. As far as I know, there is nothing that has really 
gotten in the way of us actually passing money to the American 
Samoa government.
    Mrs. Radewagen. So, to your knowledge, nothing has been 
lost, nothing has been subtracted from that DOI subsidy that is 
intended for the hospital?
    Mr. Bussanich. I certainly don't think----
    Mrs. Radewagen. So, the full amount or installment reaches 
the hospital directly. Is that what you are saying?
    Mr. Bussanich. It has never been brought to my attention 
that it has gone elsewhere. We would certainly look into it and 
insist that it goes to the LBJ Hospital if it were brought to 
our attention that it was going somewhere else.
    Mrs. Radewagen. Thank you, Mr. Chairman. I yield back my 
time.
    Mr. LaMalfa. Thank you. We will now recognize Mr. Westerman 
for 5 minutes.
    Mr. Westerman. Thank you, Mr. Chairman, for allowing me to 
join the hearing today. I thank the witnesses for being here, 
especially the ones who traveled so far. And my colleague, Mrs. 
Radewagen, for all the hard work you are doing, representing 
American Samoa.
    Director Bussanich, in your testimony you list three 
primary goals of the Office of Insular Affairs: the first being 
to create economic opportunity and the second is to improve the 
quality of life. I, too, was on the CODEL that visited American 
Samoa, and I can testify it is a long ways from here to there. 
It is a very isolated part of the world.
    In testimony submitted for the record by Governor Lolo 
Moliga, major issues are still lingering from policies of the 
Obama administration. And the Governor described those as 
Federal over-regulation that has crippled the territory's 
ability to develop a strong economy, and thus have stymied 
local funding that would otherwise be directed toward the LBJ 
Hospital. Those are the Governor's words.
    Two of those issues fall directly under the jurisdiction of 
this Committee: the national ocean monuments and sanctuary 
expansions, and prohibition placed on fishing in the high seas. 
I know that when we were there, the issue of fishing on the 
high seas was discussed, and there were questions about whether 
that was even doing anything to help the tuna population, as 
other countries were coming in and over-fishing those areas.
    Do you agree with the Governor's claim that if the Federal 
over-regulations still lingering from the previous 
administration are left in place, that the territory will be 
unable to develop a sustainable economy, and thus will be 
forced to continue under-funding the LBJ Hospital?
    Mr. Bussanich. Actually, sir, I think that is a question 
kind of beyond the view of my office. I mean the example you 
gave about fisheries, while it was certainly a subject of the 
Obama administration, was not part of the Office of Insular 
Affairs.
    We certainly are an advocate for American Samoa within the 
current administration. And if tasked to look at this, we would 
certainly give our opinion.
    Mr. Westerman. Can you share with the Subcommittee any 
efforts that OIA has begun during this new Trump administration 
to review policies regarding marine monument expansion in 
American Samoa?
    Mr. Bussanich. I would have to deflect that to the 
appropriate bureau or office, because the Office of Insular 
Affairs itself does not participate in those regulatory 
schemes.
    Mr. Westerman. OK. Shifting gears a little bit, we 
obviously visited a hospital while we were there, and also 
visited the VA facility. As an observer from far away, and I 
represent a very rural district in Arkansas, but I can probably 
count up at least a half-dozen hospitals in my district that 
have had a lot more capital put into them and are much more 
advanced than the hospital on American Samoa, as far as the 
infrastructure and facilities there.
    But, obviously, there were some very dedicated healthcare 
professionals there doing the best they could with the 
facilities they have. In my district, there are a lot more 
hospitals, and there are much larger, nicer hospitals just a 
few hours away from some of these small, remote hospitals.
    Also, at the VA facility, we saw that people were having to 
be air-evacuated to Hawaii for major health concerns. And it 
dawned on me, shouldn't the VA and the local hospital be 
working together, and maybe some of that money the VA is 
spending to airlift people could go toward having a better 
hospital there on the island that everyone could take advantage 
of.
    Ms. Young, has there been any work between the VA and the 
hospital on the island, trying to coordinate and provide, or 
pool the efforts so you could provide better services?
    Ms. Young. I know that our agency does not get involved in 
those discussions. That is a high-level discussion usually done 
between--I know that we have had cases in the past where our 
governor has been in touch with our Congresswoman to assist in 
triggering those types of services and assistance to the 
territory.
    This is a followup to Congresswoman Colon's question--the 
Medicaid state plan has not been changed until now, and it took 
us almost 3 years in negotiations with CMS to make some of 
those changes. One of those changes, which is very key to the 
off-island referral program, is to allow our agency to 
reinstate the off-island medical referral program directly with 
our agency. That would allow my agency to contract directly 
with the air carriers, as well as hospitals in the United 
States, as well as in New Zealand.
    Under the Medicaid state plan, the Medicaid funding can be 
used for transportation services. Currently, the hospital does 
use some of that for nominal transportation airfares. But 
because the LBJ Hospital has not implemented the off-island 
referral program for nearly 10 years, they cannot draw down 
transportation Medicaid funds.
    We will be able to do that starting in the new fiscal year, 
once the local government provides local funding. When that is 
done, we hope that we can better resolve the issues of air 
transportation, including air ambulance services to the United 
States through the Medicaid program, which will also allow us 
to draw down our Medicaid additional ACA funding provided 
through the ACA law.
    Mr. LaMalfa. Thank you, Mr. Westerman. I recognize Chairman 
Bishop for 5 minutes, if you so wish.
    Mr. Bishop. Thank you, I appreciate that. I appreciate you 
holding this hearing. I was with all of you--most of you, 
anyway--at this hospital. And it was an enlightening spot.
    Mr. Westerman, I would actually like to follow up on where 
you were going with that. Would you like a couple minutes to 
continue on with that? The issue of VA spending especially, as 
we have the CHOICE Act--if indeed the services can be there at 
the island, or if everyone still has to fly, does the Medicaid 
you are talking about, does that solve this particular issue? 
Can I yield to you a couple of minutes to continue on with 
that?
    Mr. Westerman. Well, you are heading right down the line of 
questioning. And would you care to address that more?
    Ms. Young. Sure. We have approached that. Three years ago, 
when Governor Lolo came into the administration, his mandate to 
our office, as well as to the CEO and to the Director of the 
Department of Health, was for us to pursue every avenue to see 
how we can better improve the delivery of healthcare services 
in American Samoa, which included reaching out to the VA.
    And we have done that, and it is something that--the 
Medicaid agency is under the purview of CMS and the HHS. So, as 
a separate department, it requires partnership at a higher 
level with the VA. I don't think we are precluded from 
continuing to pursue that, but it always comes down to funding, 
availability of resources, and the separate jurisdictions of 
our departments.
    We came in February of 2015, and one of the initiatives 
that the Governor wanted us to pursue was to also approach the 
Uniformed Services University for health services to see what 
they could do to help us with our workforce development for the 
medical care workforce. And we----
    Mr. Westerman. Being mindful of the Chairman's time, one 
other issue I remember was--and correct me if I am wrong--but 
the VA clinic indicated that the hospital did not meet 
standards for the VA care, so the hospital would have to be 
brought up to standards before the VA could use the hospital. 
Is that correct?
    Ms. Young. That is my understanding. And I want to share 
the USU contact allowed the Governor and the President of the 
University to sign an MOU to allow graduate students of nurse 
practice to be located and assigned on TDY to the FQHC in 
American Samoa to help us with that. And the preceptors will 
come from both the LBJ Hospital and the FQHC. We hope that is a 
segue for us to develop an inroad to work more closely with the 
VA.
    But you are correct, sir, in saying that the VA cannot at 
this time utilize the LBJ Hospital. But they may be able to 
utilize the FQHC for VA services.
    Mr. Westerman. I yield my time back.
    Mr. Bishop. Mr. Faumuina, can I have you address that same 
particular issue? Is Medicaid funding going to be the solution 
to this, or do we have to do other things--you have a whole 
bunch of veterans in Samoa--to make it possible for them to 
come back and stay?
    Mr. Faumuina. I really don't have a clear answer for that, 
your honor.
    Mr. Bishop. Well, OK. I don't either.
    Mr. Faumuina. I probably don't understand the question.
    Mr. Bishop. It was simply what we were talking about here, 
these two issues again, the ability of actually being able to 
provide services there at LBJ, and does an upgrade need to be 
there, and also does the upgrade need to take place?
    And the second one was does Medicaid funding, if you are 
looking at those funds in the future, does that solve the 
problem of transportation back to Hawaii, or to the mainland?
    Mr. Faumuina. At this point we are using our local funds to 
provide transportation only, and no medical care bills for 
outside providers.
    Mr. Bishop. My gut feeling is that Medicare or Medicaid, by 
itself, will not solve that problem, will not be enough to meet 
the need that is actually there. Am I wrong with that gut 
feeling? Either way, anybody? Westerman, you can answer that. 
Whomever.
    [Laughter.]
    Ms. Young. Chairman----
    Mr. Faumuina. With respect to Medicaid funding, we are 
really at the mercy of the local Medicaid office to determine 
what LBJ is eligible for and what LBJ is not eligible for. We 
do submit our report to them, and they will process it through 
the system, and we get reimbursed for what is due to us.
    Mr. Bishop. Thank you. My time is over. Once again, I do 
appreciate you being here, traveling this distance to come to 
talk about this issue. It is important.
    Mrs. Radewagen has been continuously telling us how 
important it is, and it is. So, I appreciate her bringing this 
to our attention all the time, too.
    Mr. LaMalfa. Thank you, Mr. Chairman.
    All right, we will open it up for a second round of 
questions here. I would start off again, back to Mr. Faumuina.
    In previous testimony, you did mention that there has been 
discussion about a new facility, a 200-bed facility. But I 
wanted to roll back to the staffing difficulties there has 
been. You mentioned the number of pharmacists--I think the 
numbers were--11 would be required, and you have 3. On the 
nursing ratio it was about, I think, 120 or so and you have 
about 70. And doctors, I cannot quite remember those numbers. 
But you have had a real challenge with staffing.
    So, I guess relating--how would you get the staffing level 
up to what you have with the current facility, let alone a 
newer, larger facility? What is the magic, the silver bullet 
for getting that done? What do you see as the way to accomplish 
that?
    Mr. Faumuina. The staffing is always a challenge for us 
because of the difficulty of recruiting the right or qualified 
personnel to take over the positions for doctors, nursing, and 
other technical assistants.
    When the CMS comes to do their assessment of our patient 
care, they discover that there are times that we do not have 
enough physicians to attend to the needs of the patients. The 
same goes with our registered nursing staff. In those areas, 
when they go through the charts and the forms, they discover 
that we do not have enough staff.
    And the problem with management, we cannot recruit when we 
do not have the resources to recruit them.
    Mr. LaMalfa. Where is the recruiting, how far do you have 
to cast the net for recruiting?
    Mr. Faumuina. We recruit from everywhere. We go as far as 
the Philippines, Fiji, and the Pacific, but most importantly we 
try to recruit from the United States. But it is so difficult 
for them to--they are interested to come to the Pacific, but at 
the end of the day, the salary issue becomes prohibitive for 
them to make a decision.
    Mr. LaMalfa. Are there any other comments you would like to 
make, with the remaining time I have, on the issue in general? 
I again respect the amount of travel you had to be here. Are 
there any other issues you would like the time to cover a 
little bit?
    Mr. Faumuina. [No response.]
    Mr. LaMalfa. Sorry I caught you on the spot. Let me throw 
that to Ms. Young here, too.
    What areas would you like to emphasize in front of this 
Committee today that we may have fallen short on for time?
    Ms. Young. Thank you, Mr. Chairman. I believe that in our 
testimonies we have laid out the priorities for our government 
and for the territory, which is the need to extend the timeline 
for us to expend the ACA money.
    But also, because DOI is here--and this is not a comment 
that would help answer the question of why it is that we cannot 
draw down enough of the money, besides the fact that we only 
have a small population, we have limited medical services, we 
have only one hospital provider--I think what needs to also 
happen is the Department of the Interior--and this is my 
recommendation--is to provide technical assistance to the 
hospital to allow the hospital to better capture, and more 
effectively capture, the cost of doing business in the 
hospital.
    Capture the costs. Because only then can we help increase 
their draw-downs through their certified public expenditure 
payment method through the Medicare cost report. It would be 
very helpful for DOI to hear that, that LBJ Hospital would 
benefit greatly, but because the hospital has not had enough 
funding, and their cash-flow is a problem, they have been 
unable to consult with a Medicare cost report expert to better 
capture the cost of doing business, as a hospital. Thank you 
very much.
    Mr. LaMalfa. Thank you. On my remaining time, Mr. 
Bussanich, is it realistic for OIA to expect the Samoan 
government to be able to promote efficient and effective 
governance while still Federal regulations are hindering, 
really, the growth of the territory?
    Mr. Bussanich. Well, from our point of view, given that we 
are working under whatever statutes and regulations are in 
place throughout the United States, I think, we take those as a 
given. We also recognize, as we were speaking of, the relative 
isolation, kind of the economic isolation of a territory still 
makes it very difficult.
    I think we are always in a dialogue with the governors, all 
of the territories, looking at similar problems, and trying to 
represent them in what Councils that we can to ensure that the 
environment that they work in for economic development is as 
suitable as possible.
    Mr. LaMalfa. OK. I better stop there. Let me recognize Mr. 
Sablan for 5 minutes, thank you.
    Mr. Sablan. Thank you very much. Let me go back again.
    Ms. Young, on the issue of the certified public 
expenditure--I know you are an attorney, and I am not an expert 
on the particulars, but the Northern Marianas have one 
hospital. You have 57 doctors, 93 RNs, and 3 pharmacists. I am 
envious, because you have more doctors than we do.
    Yet, the cost of medical referral that is incurred by LBJ--
and they are going to say hospitals in Hawaii that meet CMS 
standards. They are paying for it already. Then that cost 
should be used as the CPEs, the certified public expenditures, 
so that draw-downs on Medicaid could be done.
    Are you doing it for LBJ?
    Ms. Young. That is a really good----
    Mr. Sablan. I need to ask this, because here we are, trying 
to find a way to continue funding after 2019 for the 
territories. And Puerto Rico at 2019 will spend 128 percent of 
its money. The Northern Marianas would have spent 93 percent.
    And it hurts our effort when somebody points and says, 
``Wait,'' because they see this as a pot of money. And they 
said, ``Look, you have''--the way we are going now means we 
would have spent 53 percent of the total pot of money. And they 
are going to say, ``You have money left over on the table,'' 
because I need to protect the Northern Marianas, too. So, why 
aren't you using that public expenditure, since they are 
qualified as CPEs?
    Ms. Young. Very good question. American Samoa is very 
different from CNMI. American Samoa has no private providers. 
CNMI, I talk with your Medicaid Director every year, and am 
always consulting with her to say how do you, how can we help 
ourselves expend our Medicaid funding more from ACA.
    And the problem is, we only have one Medicaid provider, the 
LBJ Hospital. That means we can only pay LBJ.
    Mr. Sablan. Right.
    Ms. Young. We have no private doctors that are Medicaid 
providers and we don't do off-island referral. The off-island 
referral that we do right now over the last 10 years, is simply 
partial payment of airfare.
    We do not do individual claims. The CPE is a monthly, one 
day, one sheet of paper that comes to our Medicaid agency that 
basically shows us, in aggregate, in line item, all the 
different departments of the hospital and what they expend. And 
that is what we pay. We don't pay individual claims, we don't 
track. We cannot track individual referrals off-island, because 
we don't do them.
    When people go for off-island referral, the hospital simply 
captures that off-island airfare in the Medicare cost report, 
and then the patient is left on their own to pay out of pocket, 
so we have no way in our system to track the expenses of off-
island referral patients that take themselves for off-island 
care in Hawaii or California.
    And it is a problem. We recognize that. But it is going to 
take us a while to resolve those system issues. We have started 
doing that since the Lolo administration came in, but it has 
taken a number of years for us to negotiate those changes in 
our Medicaid state plan. It cannot happen and does not happen 
overnight, but we are getting there. We just got an FQHC 
approved, we have the off-island referral approved. And 
hopefully, in the next year, we will see a substantial draw-
down in our ACA funds.
    Mr. Sablan. Let me ask, Mr. Faumuina, what will it mean for 
LBJ if Congress does not extend the 2019 ACA funds?
    Mr. Faumuina. Well, the experience that we have now is that 
the present Medicaid appropriations, which LBJ is eligible for, 
is always exhausted on the third quarter of every fiscal year. 
So, on the fourth quarter of the fiscal year we kind of rely on 
this ACA fund. Without that, then, we have to be very creative 
in coming up with other revenue sources to make up for that 
loss.
    Mr. Sablan. Yes. Some people will tell me that you guys 
just have too much money, if you are leaving 80 percent on the 
table unspent.
    Mr. Bussanich, I need to ask this. Either OIA or IGIA, to 
your knowledge, have they been working with insular areas and 
their representatives on a strategy for getting these funds 
extended? You said you are continually working with the 
territories. When is the last time you contacted a 
congressional office from the four insular areas on ACA?
    Mr. Bussanich. Well, I must say I don't know the answer to 
that.
    Mr. Sablan. Well, Steve may. He is right behind you. When 
is the last time, because you said you continually work with 
us.
    Mr. Bussanich. I don't think we have spoken about that, 
sir.
    Mr. Sablan. And you know it is a cliff, it is a funding 
cliff that will hurt critically needed--this is a public health 
issue. You are our foremost advocate in the executive branch, 
and it is 2017. And you know that 2019 will be a funding cliff. 
And you have not raised a finger, as far as you are telling me, 
and yet you testify that you are continually working it.
    I don't want to put you on the spot, but it is a matter of 
your testimony. Yet, you tell me that you don't remember.
    My time is up, Mr. Chairman.
    Mr. LaMalfa. Thank you, Mr. Sablan. Let's recognize Miss 
Gonzalez for 5 minutes.
    Miss Gonzalez-Colon. Thank you, Mr. Chairman. We have a big 
problem here, and the treatment the territories are receiving 
in Medicaid. That is the bottom line of the problem.
    And, of course, being American Samoa in the Pacific, that 
triggers a lot of extra problems to manage the VA facilities 
and the treatment, and the shortage of personnel to attend in 
that.
    This House of Representatives filed in December of last 
year a Task Force Report on Puerto Rico. And one of the issues 
in that report was the Medicaid situation between the 
territories. I would like to refer to one of the lines in the 
report--By contrast, in Puerto Rico and the other territories, 
Federal Medicaid funding is subject to an annual cap pursuant 
to the Social Security Act. That cap increases annually 
according to the change in the Consumer Price Index for all 
urban consumers.
    And the problem in the territories, once that Federal 
funding cap is reached, the territory government is responsible 
for the remaining cost of the Medicaid services. In our case, 
our cap in Fiscal Year 2016 was more than $335 million. In 
American Samoa, it was $11.1 million.
    The situation with this is that FMAP territories are not 
based on the per-capita income, rather than the fixed in the 
Federal statute. So, we need to fix the problem itself, and the 
problem is the way we are treated in the Medicaid and Medicare.
    In terms of the ACA, some may say that it helped us a lot, 
because they gave us some money, one-time money, one-time 
funding. But the problem, it was $7.3 billion, of which Puerto 
Rico got $6.4, and the rest of the territories just got the 
rest. But the problem is that was not a solution. We are still 
needing to have a permanent solution to the ACA or to the 
healthcare problem for the whole territories.
    Once we finish or complete that kind of a task, then we 
don't have to be here every year asking for money for each of 
the territories in the Medicaid.
    One of my concerns is that before 2011, we got 50 percent 
of the share of the FMAP. The reality is that the increase to 
just 55 percent is below the rest of the states, in terms of 
the per capita. And if we were managing the allocation of money 
for the territories, including American Samoa, in the per 
capita as the rest of the states, you could be having 83 
percent. And that is part of the report.
    So, I encourage this Committee to try to have a permanent 
solution on the Medicaid problem, looking for the inclusion of 
the territories, the whole territories, in a final solution 
regarding the cap, the FMAP, and the distribution of the funds. 
Because the ACA, I mean the Obamacare, was not a solution, and 
is still hurting all territories, including American Samoa.
    I want to thank the members of the panel for being here 
today, because I know how far it is to come here in this kind 
of Committee. And I would like to yield back the rest of my 
time to Mrs. Radewagen, if the Chairman allows that.
    Mr. LaMalfa. Sure.
    Mrs. Radewagen. Thank you, Mr. Chairman.
    Miss Gonzalez, I keep going back to this--I am fascinated 
with your question that you asked earlier about this unspent 
money. And it just seems that my colleagues are still focusing 
on this unspent money, and they--I too want to understand. 
Because if this money became available in 2011, that is 4 years 
before I was even elected to Congress.
    Now, the Medicaid Director here, I am looking at her 
statement, and she is extremely critical of the Obama 
administration, where she says the ACA was passed with no input 
from American Samoa, for us to explain that simply setting 
aside so much Medicaid funds with a deadline for expenditure by 
2019 was not logical, as American Samoa only had one Medicaid 
provider, which she did explain.
    And the point of it is, in my thinking, that this is about 
helping the local government. It is about helping our economy. 
But, most importantly of all, we are talking about the health 
of our people.
    I mean I have tears in my eyes when I go to that hospital, 
people cannot get the services they need, and they have to 
struggle to find extra money they don't have to try to go up to 
Honolulu. This has been going on for years. And quite frankly, 
I am not convinced that the entire answer is right there, that 
it would take 3 or 4 years to negotiate all that was being 
negotiated in order to--I mean somebody should have gotten to 
Congress, somebody should have gotten to the CMS, the Secretary 
of HHS.
    After all, isn't that where the money came from? The 
Secretary of HHS put this pot of money out there. I just fail 
to understand. Thank you.
    Mr. LaMalfa. Miss Gonzalez, time has expired, but yours is 
starting, Mrs. Radewagen, so I will recognize you for 5 
minutes.
    Mrs. Radewagen. You have a comment? To the Medicaid 
Director, can you please comment on this?
    Ms. Young. Sure, thank you, Congresswoman. I think the 
Committee has made a really good point, and has raised this in 
your comments and questions, about some of the challenges that 
we face as a territory.
    I do want to correct that I was not critical of the Obama 
administration. What I was criticizing is the nature of policy 
making at the Federal level, what oftentimes--and this goes to 
what Miss Gonzalez had talked about--overlooks the input from 
the territories, which is why it is so valuable that this 
hearing is being held. When the 2011 ACA was passed, there was 
really no relevant consideration with the situation in the 
territories.
    For example, in American Samoa we can barely spend this 
down because we have one hospital. But CNMI needs more money 
every year, because they have dozens and dozens of providers. 
Guam needs more money. Puerto Rico needs more money. We have a 
problem spending our money.
    And you are correct, Congresswoman. Part of the problem is 
also our own Medicaid program in American Samoa, because for 35 
years nothing changed. And I came in 2013, 2014 was when we 
started to look at amending the state plan.
    And it really did take us a few years to negotiate this, 
because before you can change anything with CMS, it requires a 
lot of documentation and financial impact analysis. So, we had 
to hire consultants to do the analysis. The procedures are in 
place already for CMS, and we have a very good relationship 
with CMS, and they understand the issues that we are going 
through.
    Unfortunately, the changes are not happening as fast as we 
would like, but they are changing. So, I think, together with 
the Federal agencies and the Federal Government, having a 
better understanding of our local situations for all the 
territories, the need to make relevant policies that impact us, 
but also we recognize that internally, not only within LBJ, 
within the Medicaid program in American Samoa, and within our 
government, we also have problems that we have to take care of. 
But it does take time.
    Mrs. Radewagen. Thank you, Director. Thank you very much.
    Yes, I can only refer to your statement, which is right 
here in front of me, where you seem to be very, very critical 
of the Obama administration.
    At any rate, the next question has to do with the century-
old water system. And I think I am going to just give this to 
CEO Faumuina.
    Can you tell us what effect the water system has on the 
health in American Samoa? It has just come to my attention that 
we have lots of these pipes that are lead pipes and what not.
    And does the island's water infrastructure problems 
interfere with your ability to maintain a sanitary environment 
for your patients at the hospital?
    Mr. Faumuina. Yes. We have replaced the water lines to the 
LBJ Hospital with PVC pipings. Unfortunately, we continue to be 
on the watch by ASPA, on the boiling water alerts, which means 
to tell us that the water supplies that come to LBJ are still 
on a watch-out by ASPA.
    So, despite the fact that we have PVC replacements, there 
are other areas of American Samoa that still have that lead 
piping that brings the water through LBJ.
    Mrs. Radewagen. Thank you, CEO. And let's see, I want to 
thank again the witnesses for traveling all this way, and thank 
you, CEO, in particular, for all you do to try to improve the 
health care of our patients.
    Mr. Faumuina. Thank you.
    Mrs. Radewagen. Thank you, Director, on what you are doing 
with Medicare. We want to try to get that solved sooner, rather 
than later.
    Thank you very much. I yield back the balance of my time.
    Mr. LaMalfa. Thank you, Mrs. Radewagen. Thank you again for 
your effort in bringing this to the attention of the Committee, 
and helping to be the driving force on that.
    This is not totally conventional, but, indeed, given the 
amount of travel you made to be here today, Mr. Faumuina, would 
you like to make any kind of a closing statement, or Ms. Young, 
on this issue before we adjourn?
    Mr. Faumuina. Thank you, Mr. Chairman. I would like to take 
this opportunity to thank the Committee for extending these 
invitations to us. We continue to face the challenges until 
such time that we have resolved this CMS survey, as will 
continue to come down hard on us.
    Fortunately, they are very lenient and understandable about 
our challenges. And, as they have cited in their latest 
reports, we have financial, infrastructure, staffing, and all 
of these challenges that we face. But we manage to stay afloat 
and be very creative in the use of our limited resources.
    And we thank you for taking the interest in American Samoa. 
When the CODEL visits came down earlier this year, I took it as 
this is just another visit by the Congress. But, fortunately, I 
did not know that we would come this far, and for me to come 
and testify before your honorable Subcommittee.
    Thank you very much, and may God bless all.
    Mr. LaMalfa. Thank you.
    Ms. Young?
    Ms. Young. Mr. Chairman and the members of the Committee, 
thank you very much for this opportunity to testify before the 
Committee. I consider it really invaluable that we are here 
before you today, and really wonderful that the Committee took 
notice of American Samoa, and to be able to hold this hearing 
to hear the challenges that we have.
    I would also be remiss if I did not thank the Committee for 
visiting American Samoa in February. I am sorry that we were 
not there when you visited, as we were here for the NGA meeting 
for the governors. But it was extremely important to the 
Governor and to all of us who were not there that deal with the 
healthcare system of American Samoa.
    Having said that, thank you very much for this opportunity, 
and I look forward to working with the Committee in the future, 
should you need any further information from our Medicaid 
agency.
    Mr. LaMalfa. OK. Thank you. Mr. Bussanich, you don't get 
the travel award for being here today, but we appreciate your 
presence here as well.
    With that, I just want to again thank you all and the 
members of the Committee that have participated today. If there 
are any additional questions for the witnesses, we will ask you 
to respond to those in writing. Under Committee Rule 3(o), 
members of the Committee must submit witness questions within 3 
business days following the hearing. The hearing record will be 
held open for 10 business days for those responses.
    If there is no further business, without objection, the 
Subcommittee stands adjourned. Thank you.

    [Whereupon, at 11:26 a.m., the Subcommittee was adjourned.]

[LIST OF DOCUMENTS SUBMITTED FOR THE RECORD RETAINED IN THE COMMITTEE'S 
                            OFFICIAL FILES]

Rep. Bordallo Submission

    --  Letter addressed to the Subcommittee on Indian, Insular 
            and Alaska Native Affairs from Representative 
            Bordallo in support of the Subcommittee's Oversight 
            Hearing on ``Assessing Current Conditions and 
            Challenges at the Lyndon B. Johnson Tropical 
            Medical Center in American Samoa,'' dated July 25, 
            2017.

Rep. Westerman Submission

    --  Testimony of Governor Lolo Matalasi Moliga for the 
            Subcommittee's Oversight Hearing on ``Assessing 
            Current Conditions and Challenges at the Lyndon B. 
            Johnson Tropical Medical Center in American 
            Samoa,'' dated July 25, 2017.

                                 [all]