[Senate Hearing 115-680]
[From the U.S. Government Publishing Office]





                                                        S. Hrg. 115-680
 
                  NOMINATION OF ALEX AZAR TO SERVE AS
                     SECRETARY OF HEALTH AND HUMAN 
                                SERVICES

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

                                HEARING

                                 OF THE

                    COMMITTEE ON HEALTH, EDUCATION,
                          LABOR, AND PENSIONS

                          UNITED STATES SENATE

                     ONE HUNDRED FIFTEENTH CONGRESS

                             FIRST SESSION

                                   ON

  EXAMINING THE NOMINATION OF ALEX MICHAEL AZAR II, OF INDIANA, TO BE 
                 SECRETARY OF HEALTH AND HUMAN SERVICES

                               __________

                           NOVEMBER 29, 2017

                               __________

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                                Pensions
                                
                                
                                
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          COMMITTEE ON HEALTH, EDUCATION, LABOR, AND PENSIONS

                  LAMAR ALEXANDER, Tennessee, Chairman
                  
MICHAEL B. ENZI, Wyoming             PATTY MURRAY, Washington
RICHARD BURR, North Carolina         BERNARD SANDERS (I), Vermont
JOHNNY ISAKSON, Georgia              ROBERT P. CASEY, JR., Pennsylvania
RAND PAUL, Kentucky                  AL FRANKEN, Minnesota
SUSAN M. COLLINS, Maine              MICHAEL F. BENNET, Colorado
BILL CASSIDY, M.D., Louisiana        SHELDON WHITEHOUSE, Rhode Island
TODD YOUNG, Indiana                  TAMMY BALDWIN, Wisconsin
ORRIN G. HATCH, Utah                 CHRISTOPHER S. MURPHY, Connecticut
PAT ROBERTS, Kansas                  ELIZABETH WARREN, Massachusetts
LISA MURKOWSKI, Alaska               TIM KAINE, Virginia
TIM SCOTT, South Carolina

                   
                                     
                      MAGGIE WOOD HASSAN, New Hampshire
               David P. Cleary, Republican Staff Director
         Lindsey Ward Seidman, Republican Deputy Staff Director
                 Evan Schatz, Democratic Staff Director
             John Righter, Democratic Deputy Staff Director
             
                            C O N T E N T S

                              ----------                              

                               STATEMENTS

                      WEDNESDAY, NOVEMBER 29, 2017

                                                                   Page

                           Committee Members

Alexander, Hon. Lamar, Chairman, Committee on Health, Education, 
  Labor, and Pensions, opening statement.........................     1
Murray, Hon. Patty, a U.S. Senator from the State of Washington, 
  opening statement..............................................     4

                               Witnesses

Statement of Michael Leavitt, Founder, Leavitt Partners, Salt 
  Lake City, UT..................................................     7
Statement of Alex Azar, Nominee, to serve as Secretary, 
  Department of Health and Human Services, Indianapolis, IN......     9
    Prepared statement...........................................    11

                          ADDITIONAL MATERIAL

Question and Answers Submitted for the Record:
    Response by Alex Azar to questions of:
        Senator Paul.............................................    63
        Senator Collins..........................................    66
        Senator Young............................................    68
        Senator Murray...........................................    69
        Senator Sanders..........................................   111
        Senator Casey............................................   120
        Senator Baldwin..........................................   140
        Senator Murphy...........................................   147
        Senator Warren...........................................   153
        Senator Whitehouse.......................................   200
        Senator Kaine............................................   224
        Senator Hassan...........................................   227


                  NOMINATION OF ALEX AZAR TO SERVE AS



                 SECRETARY OF HEALTH AND HUMAN SERVICES

                              ----------                              


                      Wednesday, November 29, 2017

                                       U.S. Senate,
                    Committee on Health, Education, Labor, 
                                              and Pensions,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 9:34 a.m. in room 
SD-430, Dirksen Senate Office Building, Hon. Lamar Alexander, 
Chairman of the Committee, presiding.
    Present: Senators Alexander [presiding], Murray, Isakson, 
Paul, Collins, Cassidy, Young, Roberts, Murkowski, Scott, 
Casey, Franken, Bennet, Whitehouse, Baldwin, Murphy, Warren, 
Kaine, and Hassan.

                 Opening Statement of Senator Alexander

    The Chairman. The Senate Committee on Health, Education, 
Labor, and Pensions will please come to order.
    Today's hearing is on Alex Azar, the nominee to serve as 
Secretary of the Department of Health and Human Services.
    While the HELP Committee holds a courtesy hearing on the 
nomination of the Secretary, the Finance Committee receives his 
paperwork and will vote on the nomination.
    Senator Murray and I will each have an opening statement. 
Then former Secretary and former Governor of Utah, Michael 
Leavitt--who we welcome today; Mike, good to see you and to 
have you back--and Senator Young, who is a Member of this 
Committee, will introduce Mr. Azar.
    After Mr. Azar's testimony, Senators will each have 5 
minutes of questions.
    We have a lot going on today in the Senate, but we already 
have a good turnout, so I anticipate a good, vigorous 
questioning period.
    Mr. Azar, if confirmed to lead the Department of Health and 
Human Services, you will be running a $1.11 trillion 
organization. That almost equals the total of the 12 
appropriations bills that Congress passes each year to fund 
everything from National Parks, to National Defense, to 
National Laboratories.
    You will be overseeing Medicare and Medicaid, our Nation's 
Government-run insurance programs for the poor and elderly; 
mental health and substance abuse, where you will have to 
address the opioid crisis, among many other issues; the 
National Institutes of Health where, with Francis Collins' 
excellent leadership, the United States is leading efforts to 
develop a cure for Alzheimer's, a new non-addictive pain killer 
to prevent opioid abuse, and new treatments for cancer; the 
Food and Drug Administration, where Scott Gottlieb has gotten 
off to an excellent start speeding up the approval of generic 
drugs, and working to spur innovation and access to 
regenerative medicines; and you will be faced with skyrocketing 
premiums in the individual health insurance market that are 
currently a nightmare for the nine million Americans who do not 
receive a Government subsidy to help pay for their health 
insurance.
    You will also have an opportunity to implement what the 
Majority Leader of the Senate called, ``The most important 
piece of legislation last year,'' the 21st Century Cures Act--
which Senator Murray and I, and Members of this Committee 
agreed upon--and gave broad, new powers to the FDA and the 
National Institutes of Health. It included the first major 
reorganization--Senators Cassidy and Murphy especially worked 
on that--of mental health programs in a decade, as well as 
significant new funding for the opioid crisis, which virtually 
all of us support.
    I believe you are an excellent nominee for this job. You 
have been confirmed by the U.S. Senate twice. You have offered 
to meet with every Member of this Committee, and have met, or 
spoken with, 15 Committee Members.
    You have served in the Judicial Branch as a law clerk for 
Supreme Court Justice Scalia. You know the executive branch, 
having been HHS General Counsel for 4 years and Deputy 
Secretary for 2 years. You know the private sector. You spent a 
decade in a leadership position at one of the country's major 
pharmaceutical companies, so you know the system of how drugs 
get from the manufacturer to patients.
    With all of these perspectives, you should need no on-the-
job training to lead this Department, and should be able to 
take advantage of this exciting time in biomedical research to 
speed safe drugs through the system to patients more rapidly.
    I see your broad experience as one of your principle 
assets. Experience in healthcare, to me, is an obvious asset 
for someone called upon to lead the Nation's most important 
healthcare agency.
    One reason Dr. Gottlieb, the FDA Commissioner, has done so 
well so rapidly is he knows the agency, having been Deputy 
Commissioner, and he knows the private sector as well having 
worked in it. Similarly, Dr. Collins' knowledge of NIH, and his 
experience leading the Human Genome Project, has made him an 
especially effective leader at the National Institutes of 
Health.
    I am glad to know that people like you, Dr. Gottlieb, and 
Dr. Collins have the experience on the issues that you will be 
dealing with every day.
    Healthcare costs, and drug pricing, are issues this 
Committee has studied to better understand existing challenges 
and find solutions. We plan to hold a third hearing on how the 
supply chain affects what patients pay for prescription drugs 
on December 12 to hear from the National Academies. Given your 
experience, I would welcome your input as we continue to 
examine the price patients pay when picking up their 
prescriptions.
    Healthcare is much broader than health insurance, and only 
about 6 percent of insured Americans purchase their health 
insurance in the individual market, but that is where we have 
had most of our debate and discussion. As I mentioned, nine 
million in the individual market do not qualify for a subsidy 
and are really getting hammered by skyrocketing prices.
    In Tennessee, premiums have increased 176 percent in 4 
years, and an additional 58 percent for this coming year. Both 
Congress and the Administration need to act to provide relief 
for these Americans.
    Senator Murray and I, and Members of this Committee, worked 
together on an agreement, co-sponsored by 11 other Republicans 
and 11 other Democrats, which the Congressional Budget Office 
says will prevent a 25 percent price increase in premiums by 
2020 by paying cost sharing subsidies, decreasing the Federal 
dollars spent on ACA premiums, and as a result, lower the 
deficit.
    The agreement would also give states the authority to use 
the Innovation Waiver already in the law to find other ways to 
lower premiums.
    For example, Alaska created a reinsurance program and 
lowered premiums by 20 percent with no new Federal spending.
    Yesterday, the President said he supported the Alexander-
Murray agreement becoming law by the end of the year.
    Our agreement has so much in it, and it appeals to so many 
Democrats and Independents, that it is hard to imagine our not 
passing something that prevents a 25 percent increase in 
premiums by 2020 and offers states flexibility to further lower 
rates.
    The Democratic Leader called it a ``good compromise,'' and 
said it has the support of, ``all 48 Democrats'' in the Senate. 
The Chairman of the Democratic National Committee, Tom Perez, 
tweeted last month that, ``Alexander-Murray . . . has 
widespread bipartisan support.''
    As Secretary, there are other steps you can take to lower 
premiums and stabilize the markets, such as approving states' 
Innovation Waivers, which could increase access to lower cost 
plans, and incentivize younger and healthier individuals to 
purchase insurance.
    The opioid crisis that is ravaging this country is a 
priority for the President and for every Member of this 
Committee. We are having a hearing on the state perspective on 
the opioid crisis tomorrow.
    You will be coordinating a Department-wide effort to help 
combat the opioid drug abuse. Drug overdose deaths in Tennessee 
went up by 12 percent from 2015 to 2016. In particular, 
overdose deaths related to fentanyl, a synthetic opioid, have 
dramatically increased 74 percent from 169 in 2015 to 294 in 
2016.
    Congress has passed legislation to streamline programs and 
provide funding to states and communities on the front lines of 
this crisis, including the Protecting Our Infants Act, the 
Comprehensive Addiction and Recovery Act, and the 21st Century 
Cures Act. We have also included $816 million in the fiscal 
year 2018 Appropriations bill to help address this growing and 
tragic crisis.
    As you implement these laws, we want to hear from you what 
is or is not working. We stand ready to work with you if 
additional tools or authorities are needed.
    Some are saying we need an opioid czar. I hope you will 
join me in advising the President that this is a bad idea. You 
need to be the czar. The Federal Government does not need a new 
czar. Once confirmed, you need to be the one to take charge of 
leading the Federal Government response and letting us know how 
to help.
    As I mentioned at the beginning, we have an exciting 
opportunity to implement the 21st Century Cures Act. As we 
continue oversight hearings on Cures, I hope you will work with 
us to take advantage of all this law offers, including 
President Obama's Precision Medicine Initiative, the Vice 
President's Cancer Moon Shot, and the BRAIN Initiative.
    Cures also gives you, and the FDA, new authority to hire 
the scientists it needs to make sure these exciting new 
advances are safe and effective for Americans. We all thought 
that was a big priority. I hope you use these authorities to 
make sure we take full advantage of this exciting time in 
science.
    The Committee will also perform oversight on the Drug 
Quality and Security Act, the law we passed to help ensure the 
safety of compounded drugs. I also hope we will continue to 
look at how to lower healthcare costs, including the cost 
patients pay for prescription drugs and how to keep people 
healthy.
    Looking at next year, the Committee will have to 
reauthorize the Pandemic and All-Hazards Preparedness Act, 
which provides the authority to ensure our Nation is prepared 
for, and able to respond to, public health emergencies such as 
hurricanes, infectious diseases like Zika, and bioterror 
attacks. Another important bill to fund the FDA, this one 
focused on animal drugs, is the Animal Drug and Generic Animal 
Drug User Fee Act.
    There is a lot to do. I look forward to working with you on 
this and hearing more about your priorities today.
    Senator Murray.

                  Opening Statement of Senator Murray

    Senator Murray. Thank you very much, Chairman Alexander, 
and thank you to all of our colleagues for being here today.
    Mr. Azar, thank you and your family, for being here and 
your willingness to serve.
    In November 2016, people started emailing me and calling, 
coming up to me in the grocery store and everywhere else with 
tears in their eyes wondering what the future held, especially 
for their healthcare, and it has not stopped.
    Because these worries and challenges are what this Congress 
and the Department--and what we are discussing today--is 
supposed to be focused on, I am going to start my remarks with 
a few examples of the stories I have been told over the last 
year.
    My constituent Julie, from Mercer Island, is a four time 
cancer survivor. She has said she would not be able to afford 
her medical expenses, or even stay alive, without Affordable 
Care Act protection.
    Kim from Ellensburg shared her story about her addiction to 
opioids and her ability to overcome it with the right 
comprehensive treatment.
    Kristina from Marysville said that before going to Planned 
Parenthood, she struggled to get birth control regularly given 
her unpredictable schedule in the fast food industry.
    Those are just a couple of examples. There are many others 
and so many pressing health problems this Administration could 
be solving. But it appears that instead of solving problems, 
the Department of Health and Human Services under President 
Trump so far has been determined to create problems.
    The Department has not attempted to help people get high 
quality, affordable coverage. They made it harder by stopping 
payments for out of pocket cost reductions, by letting insurers 
cover fewer benefits, by cutting this year's Open Enrollment 
period, and slashing funding for consumer outreach, and a lot 
more.
    Rather than allowing women to make their own healthcare 
choices, the Department has tried at every turn to impose right 
wing ideology on women and even prevent them from getting care 
from a provider that they trust.
    President Trump went to states like New Hampshire and Ohio 
and said he would confront the opioid epidemic head on and 
called it a tremendous problem. People believed that he would 
make sure hard hit communities get the resources that they 
need.
    But this Administration, and its health department, did the 
opposite. It proposed gutting Medicaid, which offers critical 
wraparound services and substance use disorder treatment, to 
people who otherwise could not afford it. Experts say that 
would cripple response efforts.
    All it took was a meeting with a few pharmaceutical 
executives for President Trump to ``go dark'' on the 
skyrocketing costs of prescription drugs, despite the 
President's promises about bringing prices down.
    In fact, it is hard to find a healthcare problem the 
leadership at HHS has not only failed to address so far, but 
actively made worse.
    The Department has proposed using public health funds to 
close near term budget gaps rather than to prevent costly 
illness and disease down the road. It utterly failed to see the 
urgency of the public health crisis that is still unfolding 
today in Puerto Rico and the U.S. Virgin Islands in the wake of 
Hurricane Maria.
    The Administration is even rolling back protections that 
prevent discrimination against people who have historically 
been denied equal access to healthcare. It should not have to 
be said, but the absolute last thing our Nation's health 
department should be spending time on is encouraging more 
discrimination in our healthcare system. That is wrong.
    Now, Mr. Azar, you and I do have some stark disagreements, 
but your nomination, still, could be an opportunity for HHS to 
reset, to put aside the extreme politics that are actively 
endangering people nationwide, and start focusing on the 
Department's mission instead of President Trump's ideological 
agenda.
    People across the country would be far better off if you 
took this opportunity. But, Mr. Azar, I have to say with 
concern that my review of your record leaves me with serious 
doubts that you will.
    You know as a pharmaceutical executive you raised drug 
prices year after year. Eli Lilly, as we know, is currently 
under investigation for working--under your tenure--with other 
drug companies to needlessly raise the price of insulin. You 
have said many times you oppose Government efforts to lower 
drug prices.
    You have also made it clear on questions of women's health. 
You said with ideology over science and right wing politicians 
over women.
    Although conservative experts, and Governors, and even some 
Members of Congress have rejected President Trump's attempts to 
sabotage the healthcare system and jam Trumpcare through, you 
said this legislation would have spiked premiums, undermined 
protections for people with preexisting conditions, gutted 
Medicaid, cost tens of millions of people their healthcare, 
defunded Planned Parenthood, and more. You said it did not go 
far enough.
    Mr. Azar, this leaves me very concerned about whether you 
would faithfully implement the bipartisan agreement--that 
Chairman Alexander just talked about with us--that we reached 
earlier this year should it become law.
    Finally, in light of President Trump's profoundly under 
whelming follow through on his campaign promises about tackling 
the opioid epidemic, it is deeply disappointing that yet 
another nominee for the role of Secretary of Health has not 
supported committing the new resources we need for this effort.
    Mr. Azar, I worry about your professional history and 
statements that point to a continuation of some of the 
extremely damaging and politically driven approaches we have 
seen so far from this Administration.
    Let me just return briefly to the stories I mentioned at 
the beginning of my remarks to make my final point.
    Right now, Julie is traveling around the country raising 
awareness about Open Enrollment to help more people sign up and 
get access.
    Kim is now pursuing a Master's in social work, and helping 
people in central Washington to get the necessary treatment and 
services so they can overcome their addiction.
    Kristina has become a vocal advocate for helping women in 
Washington and, actually, nationwide to get care that works for 
their needs.
    Julie, and Kim, and Kristina are doing more than their part 
to keep our communities health and well.
    My question is why is our Nation's health department not 
doing the same?
    People should have a Secretary of Health who will work for, 
and with, patients and families, not against them and who is 
committed to making policy based on science, not ideology.
    Mr. Azar, I am looking forward to your thoughts on the many 
serious concerns that I have raised and how you would be an 
appropriate choice for this position.
    I am concerned that President Trump has yet sent us an 
extreme ideological driven nominee to pick up where Secretary 
Price has left off and that women, and children, and seniors, 
and families deserve a lot better.
    I am interested in your responses today. I hope I am 
pleasantly surprised.
    I do want to say, if you are confirmed, I want to make it 
very clear I have not, and will not, let this Administration's 
approach so far lower my expectations for any of the Department 
this Committee oversees. I will continue doing everything I can 
to hold HHS to the highest possible standards of ethics and 
service for people in my state and across the country.
    With that, thank you very much for being here and I will 
turn it back over.
    The Chairman. Thank you, Senator Murray.
    We will now welcome the nominee, Mr. Alex Azar and we also 
welcome your family, and friends, and attendants. We thank them 
all for being here. There is a pretty good group of them and 
you may want to introduce them when you begin.
    Mr. Azar will first be introduced by Governor Mike Leavitt. 
Governor Leavitt served as President George W. Bush's Secretary 
of the Department of Health and Human Services from 2005 to 
2009. He worked closely with Mr. Azar then while Mr. Azar 
served as his Deputy Secretary.
    Then the nominee will be introduced by his home state 
Senator, and a Member of this Committee, Senator Todd Young.
    Governor Leavitt, please introduce Mr. Azar, and welcome.

                  STATEMENT OF MICHAEL LEAVITT

    Mr. Leavitt. Thank you, Chairman Alexander, and Senator 
Murray, and Members of the Committee.
    Senator Alexander and Senator Murray have very ably 
described the complexity and the importance of this role. 
Therefore, it is my privilege to introduce, and to 
unequivocally recommend, Alex Azar. He is up to the task. He is 
supremely well qualified to carry out this important work.
    As mentioned, during my service as Secretary of HHS, Mr. 
Azar was Deputy Secretary. In essence, he was the Chief 
Operating Officer of this very large and complex department.
    Prior to his service, he served as the General Counsel 
under Secretary Thompson who, I believe, later will also 
introduce, and robustly recommend him, to the Finance Committee 
as they consider his nomination.
    That, plus his experience in the private sector that has 
been mentioned, leads me to conclude that there may not have 
been a nominee to this office of Secretary better prepared to 
hit the ground running than Alex Azar.
    It was mentioned that HHS is a large and complex place. 
While Deputy Secretary, Alex Azar was essentially the manager 
of the day to day operations of 90,000 employees and a $1.1 
trillion budget. Just a brief example that, I think, would 
illustrate his capability.
    President Bush had a management agenda that laid out 
criteria of several dozen different objectives, and then had a 
dashboard of green, yellow, red. Alex set an objective to have 
every criterion green, and he was the first Deputy Secretary in 
the entire Federal Government to achieve that.
    He was also delegated oversight of much of the regulatory 
process. In a very skillful and lawyerly like way, he managed 
to carefully and equitably adjudicate the administrative rules 
process, which is robust at HHS.
    He is a world class policy thinker. He is a good 
communicator. You will see that today. I can assure you that if 
he is confirmed as Secretary, you can expect good communication 
on both sides of the aisle. He is an experienced diplomat.
    Experienced, I think, is a word that will be underscored 
here. I have seen him under fire; 9/11, he was part of the 
response.
    There was a point in time when [Hurricane] Katrina, 
pandemic influenza, and the rollout of Medicare Part D were 
happening at the same time. This is a person with great 
experience in a complex Department.
    Most important, can I just say, he is an extraordinarily 
good human being. He has got the kind of compassionate heart 
that, I believe, it requires to serve, to lead the mission of 
this important Department, and I commend him to you, and urge 
the Senate's confirmation of him as the Secretary of Health and 
Human Services.
    The Chairman. Thank you, Governor Leavitt, and thank you 
for joining us again as you have before to help this Committee.
    Senator Young.
    Senator Young. Well, thank you, Chairman Alexander, and 
Ranking Member Murray, and fellow Members of this Committee.
    I am grateful for this opportunity to introduce a fellow 
Hoosier, Alex Azar, to be Secretary of the U.S. Department of 
Health and Human Services.
    President Trump made an outstanding choice in selecting 
Alex to lead this critical agency, which happens to be the 
largest civilian cabinet agency in the entire U.S. Government.
    Alex is, as has been said now by a couple of individuals, 
an extremely qualified nominee. He is a well known expert in 
the healthcare industry.
    His previous leadership experience, both as General Counsel 
and Deputy Secretary of HHS, and as President of Indiana-based 
Lilly Incorporated, Lilly USA--which is the largest affiliate 
of one of the largest healthcare companies in the world--will 
collectively be an effective combination as we work to solve 
our Nation's most significant healthcare challenges.
    Former HHS Secretary, Tommy Thompson, said that, ``Azar is 
one of the most competent people I know, an experienced leader 
with deep substantive healthcare knowledge.''
    I agree.
    In addition to his impressive academic record, which 
includes degrees from Dartmouth and Yale, Alex also clerked for 
the late U.S. Supreme Court Justice Antonin Scalia.
    He first began his service at HHS in 2001 when the United 
States Senate confirmed him to serve as the Department's 
General Counsel. Since then, Alex has been a leading voice in 
healthcare reform and healthcare innovation with a reputation 
as an effective leader.
    He has been particularly outspoken on the need to lower the 
price of prescription drugs saying patients are paying too 
much. If anyone could help solve this problem, it is Alex Azar. 
He is the right person to help reform our broken healthcare 
system and to ensure the Department succeeds in its mission to 
enhance and protect the well-being of the American people.
    Alex was confirmed to both of his previous positions at HHS 
with unanimous, bipartisan support. I will say that again.
    Confirmed twice by the United State Senate for positions at 
HHS with unanimous, bipartisan support and I am hopeful this 
time will be no different.
    I know Alex is a good man with a heart for service. I have 
gotten to know him personally over the years. I look forward to 
supporting his nomination and working together to ensure all 
Americans have access to high quality and affordable care.
    Thank you, Mr. Chairman.
    The Chairman. Thank you, Senator Young.
    Mr. Azar, we now invite you to give your opening remarks. 
Your full statement will be incorporated into the record.
    Welcome.

                     STATEMENT OF ALEX AZAR

    Mr. Azar. Well, thank you very much.
    If I could take just a second to introduce my family that I 
have here today, Mr. Chairman, at your invitation.
    I am pleased to be joined today by my wife Jennifer, my 
daughter Claire, my son Alex, and my father, Dr. Alex Azar, as 
well as my sister Stacy and her family.
    Unfortunately, my mother Lynda could not be here today and 
most tragically, my stepmother, Wilma, died of cancer just in 
July, and I am very sad she could not be here for this moment.
    Having an opportunity such as this does not happen without 
the support of family and their guidance.
    Thank you, Mr. Chairman. Thank you, Ranking Member Murray, 
and Members of the Committee for the opportunity to appear 
before you today as the President's nominee to be the Secretary 
of Health and Human Services.
    Senator Young and Governor Leavitt, thank you so much for 
those extremely kind words, for your friendship, and your 
mentoring over the years.
    I also thank President Trump for the confidence that he has 
bestowed on me in nominating me for this position.
    Ninety-seven years ago, my grandfather, an impoverished 
teenager who spoke no English, stepped out of steerage on the 
S.S. Argentina, completing his long journey from Amioun, 
Lebanon to America.
    As he entered the receiving hall at Ellis Island, he met an 
individual in a military uniform. That person possessed the 
power to admit him or to send him back to poverty and 
uncertainty. That person was a Member of the United States 
Public Health Service.
    It is a testament to all that I love about this country 
that just 97 years after my grandfather went through his 6 
second physical on Ellis Island--with no discernable prospects 
other than the political, economic, and religious freedom that 
America offers--his grandson might be in charge of that very 
Public Health Service, as well as all of the other world-
renowned components of the Department of Health and Human 
Services.
    The mission of HHS is to enhance and protect the health and 
well-being of all Americans through programs that touch every 
single American in some way, every single day. We are at an 
historic time in terms of delivering on that mission through 
innovation. Through its outstanding leaders and career staff, 
HHS is primed to meet that challenge.
    This task is humbling. Marshalling and leading the 
incredible resources of the Department require innovating, 
never being satisfied with the status quo, and anticipating and 
preparing for the future.
    I think I gained these skills in the dark days after 9/11, 
as we faced the health and human consequences of those attacks; 
through the subsequent anthrax attacks and preparedness for 
potential future and further biological, chemical, 
radiological, or nuclear attacks; in the implementation of our 
completely novel Part D prescription drug benefit for seniors; 
by helping to build global, national, state, and local pandemic 
flu preparedness programs; and our response to threats such as 
SARS and monkey pox; in our efforts to continue to reform 
welfare programs to make them as modern, responsive, and as 
empowering as possible for the individuals and families that we 
serve; through innovation in the private sector to bring life-
improving therapies to our people and the people of the world; 
and in harnessing the power of big data and predictive 
analytics to make us more efficient and more capable of serving 
our fellow Americans.
    With a Department the size of HHS, it is often difficult to 
prioritize. Nonetheless, should I be confirmed, I do envision 
focusing my personal efforts in four critical areas.
    First, drug prices are too high. The President has made 
this clear. So have I, through my experience helping to 
implement Part D and with my extensive knowledge of how 
insurance, manufacturers, pharmacy, and Government programs 
work together, I believe I can bring skills and experiences to 
the table that can help us address these issues, while still 
encouraging discovery so Americans have access to high quality 
care.
    Second, we must make healthcare more affordable, more 
available, and more tailored to what individuals want and need 
in their care. Under the status quo, premiums have been 
skyrocketing year after year, and choices have been dwindling. 
We must address these challenges for those who have insurance 
coverage and for those who have been pushed out or left out of 
the insurance market by the Affordable Care Act.
    Third, we must harness the power of Medicare to shift the 
focus in our healthcare system from paying for procedures and 
sickness to paying for health and outcomes. We can better 
channel the power of health information technology, and 
leverage what is best in our programs and in the private, 
competitive marketplace to ensure the individual patient is the 
center of decision making, and his or her needs are being met 
with greater transparency and accountability.
    Finally, we must heed President Trump's call-to-action and 
tackle the scourge of the opioid epidemic that is destroying so 
many individuals, families, and communities. We need aggressive 
prevention, education, regulatory, and enforcement efforts to 
stop over-prescribing and overuse of these legal and illegal 
drugs. We need compassionate treatment for those suffering from 
dependence and addiction.
    These are serious challenges that require a serious-minded 
sense of purpose and, if confirmed, I will work with the superb 
team at HHS to deliver results.
    I thank President Trump for this important opportunity to 
serve the American people, and I thank you for your 
consideration of my nomination.
    [The prepared statement of Mr. Azar follows:]
                                 ______
                                 
                Prepared Statement for Alex Michael Azar
    I'm pleased to be joined today by my wife, Jennifer, my daughter, 
Claire, my son, Alex, and my father, Dr. Alex Azar, and my sister Stacy 
and her family. Unfortunately my mother, Lynda, could not be here 
today, and most tragically my step-mother Wilma passed away just this 
July from cancer. Thank you all. Having an opportunity such as this 
does not happen without family support and guidance.
    Thank you Mr. Chairman, Ranking Member Murray, and Members of the 
Committee for the opportunity to appear before you as the President's 
nominee to be the Secretary of Health and Human Services.
    Senator Young and Secretary Leavitt, thank you so much for those 
kind words and for your friendship and mentorship over the years.
    I thank President Trump for the confidence he has bestowed on me.
    Ninety-seven years ago, my grandfather-an impoverished teenager who 
spoke no English-stepped out of steerage on the S.S. Argentina, 
completing his long journey from Amioun, Lebanon, to America. As he 
entered the receiving hall at Ellis Island, he met an individual in a 
military uniform. That person possessed the power to admit him or to 
send him back to poverty and uncertainty. That person was a Member of 
the United States Public Health Service. It is a testament to all that 
I love about this country that just 97 years after my grandfather went 
through his 6-second physical on Ellis Island with no discernable 
prospects other than the political, economic, and religious freedom 
America offers, his grandson might be in charge of that very Public 
Health Service, as well as all of the other world-renowned components 
of the Department of Health and Human Services.
    The mission of HHS is to enhance and protect the health and the 
well-being of all Americans, through programs that touch every single 
American in some way, every single day. We are at an historic time in 
terms of delivering on that mission through innovation. Through its 
outstanding leaders and career staff, HHS is primed to meet that 
challenge. The task is humbling. Marshalling and leading the incredible 
resources of the Department require innovating, never being satisfied 
with the status quo, and anticipating and preparing for the future. I 
gained these skills in the dark days after 9/11, as we faced the health 
and human consequences of those attacks, through the subsequent anthrax 
attacks and preparedness for potential further biological, chemical, 
radiological, or nuclear attacks, in the implementation of our 
completely novel Part D prescription drug benefit for seniors, by 
helping to build global, national, state, and local pandemic flu 
preparedness, in our response to threats such as SARS and monkey pox, 
in our efforts to continue to reform welfare programs to make them as 
modern, responsive, and empowering as possible for the individuals and 
families we serve, through innovation in the private sector to bring 
life-improving therapies to our people and the people of the world, and 
in harnessing the power of big data and predictive analytics to make us 
more efficient and more capable of serving our fellow Americans.
    With a department the size and scope of HHS, it can be difficult to 
prioritize. Nonetheless, should I be confirmed, I do envision focusing 
my personal efforts in four critical areas. First, drug prices are too 
high. The President has made this clear. So have I, through my 
experience helping to implement Part D and with my extensive knowledge 
of how insurance, manufacturers, pharmacy, and government programs work 
together, I believe I bring skills and experiences to the table that 
can help us address these issues, while still encouraging discovery so 
Americans have access to high quality care.
    Second, we must make healthcare more affordable, more available, 
and more tailored to what individuals want and need in their care. 
Under the status quo, premiums have been skyrocketing year after year, 
and choices have been dwindling. We must address these challenges for 
those who have insurance coverage and for those who have been pushed 
out or left out of the insurance market by the Affordable Care Act.
    Third, we must harness the power of Medicare to shift the focus in 
our healthcare system from paying for procedures and sickness to paying 
for health and outcomes. We can better channel the power of health 
information technology, and leverage what is best in our programs and 
in the private, competitive marketplace to ensure the individual 
patient is at the center of decision making and his or her needs are 
being met with greater transparency and accountability.
    Finally, we must heed President Trump's call-to-action and tackle 
the scourge of the opioid epidemic that is destroying so many 
individuals, families, and communities. We need aggressive prevention, 
education, regulatory, and enforcement efforts to stop over-prescribing 
and overuse of these legal and illegal drugs. We need compassionate 
treatment for those suffering from dependence and addiction.
    These are serious challenges that require a serious-minded sense of 
purpose, and, if confirmed, I will work with the superb team at HHS to 
deliver serious results.
    I thank President Trump for this important opportunity to serve the 
American people, and I thank you for your consideration of my 
nomination.
                                 ______
                                 
    The Chairman. Thank you, Mr. Azar.
    We will now begin a round of 5 minute questions, and I will 
begin.
    I am just going to ask one question and I would like to 
reserve 2 minutes at the end, at least, so I can ask questions 
later.
    During the nomination process for the Secretary of 
Agriculture, Secretary Purdue, there were concerns about his 
close ties to the agriculture industry. He had been a farmer.
    During Dr. Gottlieb's confirmation to be Commissioner of 
the Food and Drug Administration, where he would approve moving 
treatments and cures through that agency, there was concern 
because he had worked with pharmaceutical companies.
    Now, you have worked with a major pharmaceutical company in 
a major position for 10 years. My own view is that is a big 
help because having some familiarity with drug pricing is such 
a Byzantine situation that someone who did not know anything 
about that or much about it, by the time they came in, they 
would be gone before they even figured out 5 percent of how we 
might lower drug prices. I think it is a plus.
    But what do you say to the skeptics who criticize you for 
that, especially for those who question the increase in insulin 
prices while you were part, while you were a leader at Eli 
Lilly over that 10 year period?
    Mr. Azar. Mr. Chairman, thank you for that question.
    As you and others have mentioned, I had the honor of 
serving as General Counsel and then Deputy Secretary of HHS for 
almost 6 years in the senior leadership there. For me, if I 
were confirmed, this is returning home. This is my place that I 
want to be.
    After HHS, I did spend 10 years at Eli Lilly where I was a 
senior leader, eventually the President of the U.S. affiliate 
directly leading the sales and marketing of all non-diabetes, 
non-oncology drugs in the United States. As the geographic 
leader, I also supported operations for those other business 
units.
    I do believe, as the Chairman mentioned, that these public 
and private sector experiences do prepare me very well for the 
role of Secretary. I think this is especially true in the case 
of drug prices.
    The price of many drugs has risen substantially; in 
particular, the product that, Mr. Chairman, you mentioned, 
insulin.
    The current system of pricing insulin, and other medicines, 
may meet the needs of many stakeholders, but that system is not 
working for the patients who have to pay out of pocket, and we 
have to recognize that impact.
    That is why the President, so many Members of this 
Committee on a bipartisan basis, and I have talked about the 
need to fix this system.
    I do think through my experience in the public sector with 
Part D; through my experiences at Lilly in the private sector; 
understanding how the channel works, how the channel sees these 
issues; how manufacturers, payers, Pharmacy Benefit Managers, 
pharmacies, distributors, all work together; how the money 
flows in that. I believe I can hit the ground running to work 
with you, and others, to identify solutions here.
    The Chairman. Thank you, Mr. Azar.
    I will reserve the balance of my time.
    Senator Murray.
    Senator Murray. Thank you very much.
    Let me just follow-up. I think the cost of drugs, the high 
cost, is something I hear about more than anything else. It 
affects so many people in a negative way. I am assuming that 
you agree with the overwhelming majority of Americans that 
drugs costs are too high.
    Do you agree that Congress and administrative actions are 
needed?
    Mr. Azar. I absolutely do, Senator Murray. Thank you.
    Senator Murray. Okay. As we know, you were President of a 
major pharmaceutical company when it got worse, as someone 
mentioned. Tell us how you would approach this as Secretary.
    Mr. Azar. Thank you, Senator Murray, and also thank you. I 
appreciate the chance we had to sit down together and I really 
enjoyed that discussion.
    Also, just in terms of your opening, I hope, if I am 
confirmed, I do hope I can earn your trust and will show you 
that this is the job of a lifetime for me.
    I would approach this not for any industry, not for any 
past affiliation, but to serve all Americans, to improve their 
health and well-being.
    Senator Murray. I appreciate that.
    Mr. Azar. I think there are constructive things that we can 
do, and I would love to just keep----
    But I would also like to hear ideas from the Committee, 
from people at HHS, elsewhere. But let me throw a couple of 
things out that, I think, are worth focusing on.
    We need to increase generic and branded competition. The 
more drugs we get into the market, as Dr. Gottlieb is working 
on, the more competition we will have. That actually can help 
bring down cost to the system.
    We have to fight gaming in the system of patents and 
exclusivity by drug companies. I have always been an opponent 
of abuse and gaming of the patent systems by drug companies.
    When I was General Counsel of HHS, I actually led an effort 
to get rid of filing multiple patents to delay, delay, delay 
the exclusivity.
    Senator Murray. Correct.
    Mr. Azar. It saved $34 billion for consumers over 10 years 
for the efforts that we pushed by reinterpreting.
    I think we need to look at why Americans are paying more 
than those in Europe and Japan. Is that fair that we are 
bearing the cost of other industrialized Nations?
    Senator Murray. I am running out of time and I have other 
questions.
    Mr. Azar. Sorry.
    Senator Murray. But I would just say the skepticism comes 
from that you were in the world of pharmaceuticals and prices 
did not drop. How are you going to do that as Secretary?
    We can talk about it later because I have other questions.
    The fox guarding the henhouse is what I hear. There is a 
lot of skepticism that you will do it from within the agency 
when you stated before that you do not believe that Government 
should be part of the problem, although you just said something 
different.
    I know others will ask about that. I wanted to particularly 
ask a question about women's health because so far, under 
President Trump's leadership and former Secretary Price, a 
number of detrimental steps were taken that undermine women's 
healthcare, including appointing multiple extreme anti-choice 
ideologues; undermining Title X teen prevention programs; and 
critically rolling back preventions for women to have full 
coverage for birth control from their insurance plans.
    I wanted to ask you. If confirmed, will you commit to 
putting science and access to healthcare first rather than 
ideology and extremism?
    Mr. Azar. Senator Murray, as we discussed in your office, 
if I am Secretary, I am the Secretary for all Americans. I am 
there to enhance and protect the health and well-being of all 
Americans, men and women.
    We have programs that this Congress has created and that 
HHS is there to implement. I would faithfully implement those 
programs.
    We may differ in different elements of how those get 
implemented, but I firmly believe in following evidence and 
science where it will take us----
    Senator Murray. Okay.
    Mr. Azar----in running these programs.
    Senator Murray. Let me ask it this way.
    Mr. Azar. Yes.
    Senator Murray. Do you believe that all women should have 
access to the healthcare their doctor recommends for them? Yes 
or no.
    Mr. Azar. If the issue is, for instance, the conscience 
exception that HHS has come out with. I do believe we have to 
balance, of course, a woman's choice of insurance that she 
would want with the conscience of employers and others. That is 
a balance. That is sort of an American value, trying to balance 
those, and it is a very small group, I think, that would be----
    Senator Murray. The woman's doctor recommends it, but you 
believe the employer has the precedence over that.
    Mr. Azar. Just in terms of, not in terms of access, but in 
terms of insurance. To force those very few, I believe it is 
less than 200 have come forward. Very few employers that would 
be impacted by the conscience exception to respect, frankly, 
their rights as well as respecting women's access through the 
insurance.
    Senator Murray. Well, I disagree. I think women's access to 
healthcare their doctor requires for them should take 
precedence, but we disagree on that.
    Let me go to a critical question that Senator Alexander and 
I both raised. You know about the legislation we have put 
forward.
    If confirmed, will you commit to implementing it as 
intended and working with us to improve further accessible 
coverage for patients?
    Mr. Azar. Absolutely.
    Senator Murray. Okay. I know that some people today are 
claiming that the bill that we designed will fix other problems 
that are being proposed.
    Do you think the cost sharing reduction payments will be 
sufficient to make up for the chaos if other tax cut proposals 
are passed?
    Mr. Azar. I think the work of this Committee on a 
bipartisan basis, frankly, it is a wonderful model for 
addressing it. It recognizes there are problems with the 
Affordable Care Act. There are problems with its 
implementation.
    There are going to be some new authorities in the package 
that you are talking about. Those will be useful, but I do want 
to caution. I do not believe it is a long term solution to 
problems that are just inherent in the Affordable Care Act 
because I think we still need to work to address in terms of 
getting to affordable insurance for people, choice of 
insurance, that insurance delivering real access to healthcare 
for people.
    Not just a card, but actual access to physicians and then 
the insurance that lets the people get the insurance that they 
want, not what we are telling them from the center.
    I do think it is an important stopgap to help along that 
way.
    Senator Murray. Well, I have a lot more questions on that, 
but I am way over time, so I will let other Members ask at this 
point.
    The Chairman. Thank you, Senator Murray.
    Senator Paul.
    Senator Paul. I think most Americans do not disparage or 
dislike people who accumulate wealth. We are fine if people 
honestly accumulate wealth.
    If you ask Americans, Sam Walton, developed this great 
store, and sold inexpensive things, and became very wealthy, 
most Americans do not think that he is a terrible person or he 
somehow abused the system.
    I do not think Americans have the same big, warm, fuzzy 
feeling for Big Pharma. I think many of us perceive that they 
use their economic might to manipulate the system to maximize 
profits. It is not like they are selling a cheaper product to 
more people. They are using Government to maximize their 
profits.
    Do you acknowledge that the current system, under the 
current system, Big Pharma uses her economic clout to 
manipulate the patent system to increase drug prices?
    Mr. Azar. There are clearly abuses, Senator, in the system 
and that is why one of the steps that I mentioned to Senator 
Murray that I believe we have to go after is the gaming of 
that. I have always believed----
    We have the Hatch-Waxman regime. It gives innovators a time 
period to sell the product, but then there should be a moment 
certain when, ``Katie, bar the door!'' There should be full 
generic competition, and that is a gift to this country, to the 
system, and to patients when they walk in the pharmacy.
    Senator Paul. But I will say this is a huge problem that 
has been going on for decades. We have had insulin since the 
1920's. It has been 50, 60 years or more with the production of 
insulin by pharmaceutical companies, and we have no generics.
    Everybody says they are going to fix it and they are 
nonspecific, but I tend to be a doubter because these problems 
go on, and on, and on.
    When you look at the drug problem, one of the things that 
people proposed is to allow us to buy drugs from Europe, allow 
us to buy drugs from Canada, allow us to buy drugs from Mexico 
or Australia.
    In fact, this was the President's position when he said, 
``Allowing consumers access to imported safe and dependable 
drugs over overseas will bring more options to consumers.''
    We have had legislation on this. We have passed it several 
times and yet, it never happens. You have taken a position 
against re-importation.
    How does that jive with the President's position?
    Mr. Azar. I have before publicly stated a position against 
unsafe importation of drugs into the United States and the 
President has said the same, reliable and safe. That is the 
first thing we have to do.
    Senator Paul. Do you think the drugs in Europe are unsafe? 
The drugs that they use in the European Union are unsafe?
    Mr. Azar. We have had a succession of Democratic and 
Republican FDA Commissioners who have been unable to certify 
under the law that importation would be safe.
    Senator Paul. They have been wrong and beholden to the drug 
companies, frankly.
    You would have to sit there and say that the European Union 
has unsafe drugs. It would be unsafe for Americans to buy drugs 
from the European Union, or from Canada, or Australia.
    It is just frankly not true. It is a canard and it has been 
going on year, after year, after year.
    We have this enormous problem and people say, ``We are 
going to fix the drug problem,'' and it never happens.
    But what I think is important for America to know: this is 
not capitalism. Wal-Mart is capitalism. Bill Gates was 
capitalism.
    Big Pharma, it is not really Big Pharma's fault even. They 
are just trying to maximize their profit by using Government, 
but we are letting them do it. We have this terrible system.
    You get an Epipen. You have it for 20 years. You manipulate 
one little thing in the spring and all of a sudden, they get 
another 5 years, and then another 5 years.
    One of the things we could do that would dramatically 
change this is if you have a patent on the Epipen for 20 years, 
you get it. If you change it and make it better, you get a 
patent on the new Epipen, but guess what? We can have generics 
on the old. Currently, you cannot have that and we have all 
these impediments.
    Why do we not have generic insulin?
    But it is going to take someone who really believes it, and 
I told you in my office, you have some convincing to make me 
believe that you are going to represent the American people and 
not Big Pharma.
    I know that is insulting, and I do not mean it to be 
because I am sure you are an honest and upright person, but we 
all have our doubts because Big Pharma manipulates the system 
to keep prices high.
    It is not capitalism and it is Big Government, and we have 
to fix it, and we cannot tepidly go at it. We have to really 
fix it and you need to convince those of us who are skeptical 
that you will be part of fixing it, and will not be beholden to 
Big Pharma.
    Mr. Azar. Well, Senator, as I said in the office with you 
yesterday, that issue of the multiple filing of patents to 
evergreen a product with a modification, say, on manufacturing 
process or delivery device, I completely agree with you.
    I think that is one of the important avenues that we ought 
to be pursuing because, again, there should be a time certain 
when competition begins with generics, and you should not be 
able to simply make a change there and evergreen your patent. I 
fought against that in the Bush administration.
    Senator Paul. I appreciate that and one thing in my last 
few seconds. On the drug re-importation, we are going to give 
you a question that you can think about and write.
    Everybody says it is not safe. What I want you to tell me 
is why the drugs are not safe in the European Union and how you 
would make it safe.
    If there is a restriction that says, ``Oh, we have to go 
through one Committee,'' I am fine with that. Vote on a 
Committee for the European drugs as they come through. It needs 
to be expedited. It needs to be happening.
    Everybody just says, ``It is not safe,'' and so we never do 
it. That is ``BS,'' and the American people think it is ``BS'' 
that you cannot buy drugs from Europe, or from Canada, or 
Mexico, or other places.
    Could we have some rules? Yes. But we just keep, we always 
just say, ``It is unsafe.''
    You are going to have to convince me that you are, at 
least, open to the idea. The President is. That was his 
position in the campaign. If you are open to it and not just 
say, ``It is unsafe.'' We will say, ``This is how I would do it 
and this is how I would reimport drugs, and make it safe.'' 
That is an honest reform. If you cannot do that, I cannot 
support you.
    I hope you will come back with an answer that says, ``This 
is how I would make re-importation safe.''
    Senator Paul. Thank you.
    The Chairman. Thank you, Senator Paul.
    Senator Bennet.
    Senator Bennet. Thank you, Mr. Chairman.
    Just following on my colleague's comments, another option 
here would be to figure out how to make our prices the same as 
the prices in these other places. People in America did not 
have to go through the ridiculous contortion of having to 
import drugs from overseas, but could just afford drugs here.
    I want to congratulate you, Mr. Azar, in your appointment 
and your willingness to serve during these difficult times.
    When President Clinton left the White House, he left behind 
a projected $5.6 trillion surplus and that is what he gave to 
President Bush.
    Then we fought two wars, and we did not pay for those wars. 
We enacted Medicare Part D, which you have mentioned a couple 
of times in your testimony, which was not paid for. Then we had 
the worst recession since the Great Depression.
    When President Obama became President, we had a $1.5 
trillion deficit when he came to office.
    President Trump ran for office, and this is the one thing I 
would say he was consistent on in his primary, and the 
Republican Party nominated him, and the American people elected 
him. His promises were these.
    He would eliminate our debt, quote, ``Over a period of 8 
years.''
    He would deliver, quote, ``Giant, beautiful, massive tax 
cuts.''
    He would pass, quote, ``One of the largest increases in 
national defense spending in American history.'' While also 
saying, quote, ``I am not going to touch Social Security and I 
am not going to touch Medicare and Medicaid.''
    Those are the President's solemn promises to the United 
States.
    In the 9-years that I have been here, this Congress has 
disgraced itself year after year by not being able to pass a 
budget, by having 30 continuing resolutions, by not being able 
to establish a set of priorities to the American people. We sit 
here today collecting 18 percent of our GDP in revenue and 
spending 21 percent of our GDP in expenditures.
    On the floor this week, disgracefully, is a tax bill that 
would reduce that 18 percent to an even lower number, below at 
least the $1.5 trillion additional deficit in our balance 
sheet, and as much as $2.5 trillion.
    The concern that a lot of people have in my state is that 
after this incredibly unpopular tax cut is jammed through with 
no hearing, that the Administration is then going to break the 
President's promise to not touch Medicare and Medicaid. 
Instead, exploit the deficits that the Republican Majority has 
created in the time that George Bush was President, and now in 
the time that Donald Trump is President, to go after Medicare 
and Medicaid.
    I wonder if you could assure this Committee that the 
President, through you as the head of HHS, will honor the 
promises that he made on the campaign trail to make sure that 
he is not going to cut Medicare and Medicaid, which is what he 
said.
    I apologize for the long windup, but the history has been 
forgotten by my colleagues and I think it is important.
    Mr. Azar. Okay. Thank you, Senator, and it is a pleasure to 
see you.
    Senator Bennet. A great pleasure.
    Mr. Azar. To meet with you yesterday.
    Senator Bennet. Thank you.
    Mr. Azar. I do hope we will have the chance to work 
together.
    As I mentioned in my opening remarks, the third of those 
four areas I really want to focus on is about strengthening our 
Medicare program because there is so much mistake, fraud, 
waste, abuse in the program, inefficiency in how we pay for 
healthcare procedures and sickness.
    If we can tackle that, and if we can move to a more value-
driven system of healthcare, we will do two things that are 
really important.
    One of them is we will actually stretch out the resources 
in the Medicare program to keep its solvency longer and allow 
it to serve its beneficiaries, especially as we face the Baby 
Boom generation.
    It will also serve as a catalyst for change throughout the 
entire healthcare system because so much of the healthcare 
system just really free rides off of whatever Medicare is doing 
on payment, et cetera. I think it is a really unique 
opportunity.
    I think the President is fully committed around this, both 
the strengthening, making Medicare and Medicaid as effective, 
as efficient as possible for the people that we serve.
    Senator Bennet. I hope we can do that in a way that is not 
infected by the idiotic politics around healthcare that we have 
had over the last 10 years in this place.
    I completely agree that incentives and disincentives in the 
program are misaligned, and we need to align them.
    On the other hand, it is also true that the reason why we 
are paying $1 in for every $3 we are consuming in Medicare is 
largely because of Medicare Part D, which was not paid for when 
it was enacted by this Congress and under President Bush, and 
because of the drug prices, which is a double whammy that has 
caused us to blow this hole.
    My concern, I have a fiscal concern, obviously, which I do 
not think is, for some reason, shared today by my colleagues on 
the other side of the aisle. But I also have a concern that 
beneficiaries in my state are going to pay a price for the 
fecklessness of Washington, DC, and I do not think that is 
fair.
    I hope we will be able to proceed on a shared understanding 
of the facts and work together to accomplish that.
    Mr. Chairman, thank you.
    The Chairman. Thank you, Senator Bennet.
    Senator Collins.
    Senator Collins. Thank you, Mr. Chairman.
    Mr. Azar, I very much enjoyed our discussion in my office 
on drug pricing, an issue that is very important to all of us, 
as you can see.
    I want to follow up on a couple of issues.
    There was a recent NBC investigation that found that a wide 
variety of prescription drugs on certain insurance plans were 
actually less expensive when the consumer paid out of pocket 
than if the consumer used his or her insurance plan.
    An example of that was a customer who had a co-pay of $43 
for a common cholesterol drug where, if she had not used her 
insurance, she would have paid less than half of that; $19.
    I then met with a group of pharmacists in the state of 
Maine, and I was outraged to learn that they are under gag 
orders that prohibit them from informing their customers that 
there is a differential in price, and that they would be better 
off not using their insurance and paying out of pocket.
    Do you support prohibiting those kinds of agreements that 
prevent a pharmacist from giving true transparency on the drug 
pricing to their customers?
    Mr. Azar. Senator, first, again, thank you for the meeting. 
I really enjoyed our discussion.
    How can you not hear about that and have your jaw drop? 
Honestly, how can you not just find that just frightening that 
could go on?
    Yes, I think that those are the types of issues across the 
entire channel in drug distribution and payment that I want to 
bring the expertise I have to the table to work with you, and 
others, and HHS, to try to resolve because that should not be 
happening. There are many other things that should not be 
happening in the channel in how that system works.
    I think we can work together to come up with solutions here 
that are going to help patients when they walk in that pharmacy 
pay as little as possible.
    Senator Collins. That absolutely should be our goal, and I 
cannot tell you how frustrated these pharmacists were that they 
were unable to give that information to their customers, who 
they knew were struggling to pay, and had high co-pay.
    A second issue that I want to explore with you today has to 
do with the investigation that the Senate Aging Committee 
undertook into sudden price spikes in off-patent drugs.
    We found that the Risk Evaluation and Mitigation 
Strategies, or the REMS system, which were intended to manage 
drugs with increased risk factors were, instead, being abused 
by certain drug companies to block potential competitors from 
accessing a sufficient amount of the drug once the patent had 
expired to do the bio-equivalency exams that the FDA requires.
    I have had extensive discussions with FDA officials about 
this. Dr. Janet Woodcock testified that the FDA has referred 
150 cases of potential anti-competitive behavior to the FTC. 
The FTC claims it does not really have enough authority.
    The new FDA Commissioner has suggested that there could be 
opportunities where the FDA could partner strategically with 
Medicare to prevent the deliberate blocking of generic 
competitors.
    From your perspective, how can we address this issue?
    Mr. Azar. Senator, I am aware of that issue also as one of 
the abuses that occur out there to prevent generic, full 
generic competition in the market.
    I would look forward to working with you and Dr. Gottlieb 
to get to real solutions there, just how REMS programs could be 
abused to block entry.
    Once we get to the end of life, we should even be looking 
at: do the REMS programs even continue to make sense? Are they 
legacies? Are they still required for safety once we achieve 
the potential for generic status?
    There may be statutory changes needed. I do not know, but I 
think we need to solve that. That is one of the changes, one of 
the things that has to be solved.
    Senator Collins. Thank you very much.
    You referred to ``the end of life,'' you meant the end of 
the----
    Mr. Azar. The end of patent life.
    Senator Collins. The patent.
    Mr. Azar. I am sorry. Yes, exactly. The end of patent life.
    Senator Collins. There is no confusion.
    Mr. Azar. No, I want to be very clear.
    Senator Collins. Yes.
    Mr. Azar. The end of patent life, sorry.
    Senator Collins. Thank you.
    Mr. Azar. Thank you for clarifying that for me.
    The Chairman. Thank you, Senator Collins.
    Senator Warren.
    Senator Warren. Thank you, Mr. Chairman.
    Mr. Azar, I will get right to the point. Your resume reads 
like a how-to manual for profiting from Government service.
    About a decade ago, you worked in Government helping 
regulate the Nation's most profitable drug companies. When you 
left, you went straight through the revolving door and became 
an executive at Eli Lilly Company. Last year, they paid you 
about $3.5 million for doing that. Not bad.
    You want to go back through the revolving door and once 
again regulate the same drug companies. At least do it until 
you decide to go through the revolving door again.
    Now, I do not think private sector experience should 
disqualify anyone from serving, but I think the American people 
have a right to know that the person running HHS is looking out 
for them, and not for their own bank account or for the 
profitability of their former, and maybe, future employers.
    I have some questions along that line.
    The first is, do you agree that when a drug company lies 
about its products, or defrauds taxpayers, it should be held 
accountable by the Federal Government?
    Mr. Azar. Of course.
    Senator Warren. Good.
    Because right before you went to work for Eli Lilly, you 
worked at HHS while they helped the Justice Department with an 
investigation of Eli Lilly's drug Zyprexa. Now, Zyprexa was 
approved by the FDA to treat schizophrenia and bipolar 
disorder.
    But Eli Lilly decided to boost its profits by pushing the 
drug on nursing homes for uses like dementia and Alzheimer's 
with no proof that it would work. The word for that is fraud 
and it cost the Government and taxpayers billions of dollars.
    Eli Lilly was still under investigation when you left 
Government service and went straight to work for Eli Lilly. 
Then as the company's top spokesman, you helped manage the 
fallout in 2009 when the company was forced to pay the largest 
criminal fine ever imposed in a prosecution like this, more 
than half a billion dollars.
    At that time, Eli Lilly's CEO said, quote, ``Doing the 
right thing is nonnegotiable at Eli Lilly.''
    Do you think that settlement represented adequate 
accountability for Eli Lilly's criminal behavior?
    Mr. Azar. Senator, I want to be really clear. The conduct 
in that case occurred and ended long before I ever even left 
the Government or thought about going to Lilly.
    I was not involved in that case when I was in the 
Government. I think I actually learned about even the 
investigation for the first time--although I think it had been 
in the media, I had not seen that--I think I learned about it, 
actually, when I was interviewing, and I learned about it, and 
I wanted to do my own inquiring because----
    Senator Warren. Right. Then you became the spokesman for 
Lilly.
    Mr. Azar. Well, I became the Global Head of Corporate 
Affairs.
    Senator Warren. Right.
    Mr. Azar. I will tell you, the conduct that occurred there 
was unacceptable and there is not a leader at Lilly that would 
say differently. It was a massive learning and transformational 
experience for the company.
    Senator Warren. Was the settlement adequate accountability 
for Eli Lilly's unacceptable behavior?
    Mr. Azar. It was the largest, you said it was the largest 
at the time.
    Senator Warren. Yes, it was.
    Mr. Azar. I think for about a week----
    Senator Warren. It was the largest of about half a billion 
dollars.
    Mr. Azar. Then there was another, and then another company 
had one.
    Senator Warren. That is right.
    But do you think it was adequate? That is my question.
    Mr. Azar. It was certainly the largest ever and what I will 
tell you the most----
    Senator Warren. Do you think it was adequate?
    Mr. Azar. I----
    Senator Warren. All right.
    Mr. Azar. Senator, what was important about that was that 
it changed behaviors.
    Senator Warren. No, I am sorry. What is important, the 
question I am asking, and that is whether or not there was 
adequate accountability.
    Mr. Azar. I do believe so. I do not have any reason to 
believe not.
    Senator Warren. I do not think there was adequate 
accountability.
    Eli Lilly made billions of dollars off this scheme and they 
paid a half a billion dollar fine. They said, ``That is a huge 
fine.'' The truth is, it is a huge fine, but they made far more 
money than they actually paid out. For me, that is just not 
adequate accountability.
    Your CEO, John Lechleiter, got to keep sleeping in his own 
bed at night, and at the end of that year, he was paid $1.5 
million for his troubles, and another $3.6 billion in so-called 
performance bonuses.
    I think the message was clear to other drug companies. 
Within 8 months, Pfizer was caught doing the same kind of 
marketing and slapped with a criminal fine for more than a 
billion dollars. Since then, there have been four more drug 
company settlements in excess of a billion dollars. These 
settlements have become a ``cost of doing business'' for the 
drug companies.
    As we speak, Eli Lilly is the subject of multiple lawsuits 
and investigations accusing the company of conspiring to 
illegally raise its prices of its insulin products.
    But we are supposed to believe that this time around, you 
are going to be willing to hold them accountable in a way that 
is going to make a difference. Let me ask you.
    Do you think that CEO's, like John Lechleiter, should be 
held personally accountable when drug companies like Eli Lilly 
break the law?
    Mr. Azar. Senator, there was a period of time where across 
the pharmaceutical industry there were various practices that 
then got resolved through litigation. What I am actually quite 
proud of is the fact that I was not there as General Counsel. I 
was not a general counsel. I did not negotiate the settlement 
of that case.
    But the attitude that I saw top to bottom globally at the 
company around that was one of, ``How do we make sure this does 
not happen again?'' How do we ensure that this, that our, that 
the processes, the culture----
    Senator Warren. Mr. Azar.
    Mr. Azar----the ethics, the oversight----
    Senator Warren. Let me interrupt because I am out of time. 
I understand that I am out of time.
    I just want to make it clear for the record. I asked the 
question about whether or not you think CEO's ought to be held 
accountable when the companies they are running break the law.
    I am just trying to get a little accountability answer. If 
you have a yes or no answer, I will take it.
    Mr. Azar. I am satisfied with our discussion. Thank you.
    Senator Warren. Okay. I will take that as a no.
    The Chairman. Thank you.
    Senator Warren. You would not hold them accountable.
    Thank you, Mr. Chairman.
    The Chairman. Thank you, Senator Warren.
    Senator Cassidy, just stepped out.
    Senator Young.
    Senator Young. Thank you, Chairman.
    Mr. Azar, you have been caricatured by some as a predatory, 
avaricious, Big Pharma executive. In response to that, I would 
like to give you an opportunity to actually say a few words 
here, as opposed to my giving an extended speech.
    Can you talk about what you did in your previous tenure at 
the agency around the drug pricing issues?
    Mr. Azar. Well, Senator, thank you for asking about that.
    Back in the Bush administration, when I was General 
Counsel, there was a very clear abuse that was occurring where 
pharmaceutical companies were taking advantage of a loophole in 
the drug laws to allow them to have longer, longer, longer 
patent periods.
    What they would do is they would get to the end. They would 
file a new patent and then get another extension. What I said 
to our legal team was, ``This is unacceptable. Nobody has ever 
thought of a way to deal with this without legislation. Let us 
see. Can we interpret the statute in a way that prevents 
that?'' Drove that, drove that, drove that.
    We actually got to the point where we put out a rule that 
allowed only a single, what is called a 30-month stay in 
litigation. You basically got one shot at the apple instead of 
these multiple four or five things that could cause a drug to 
last for years and years longer.
    When we put that rulemaking out, the economic impact of 
that rule was estimated to save consumers $34 billion over 10 
years. That rule was later enshrined through the leadership of 
Senator McCain into statute in the Medicare Modernization Act.
    Senator Young. I would just like you to repeat that for a 
second for those who may not be paying attention and who may 
want to fuel a false narrative that you are not sensitive to 
drug pricing.
    You catalyzed a process by recognizing an anomaly in the 
law that led to a regulatory change that saved how many 
billions for consumers in prescription drug prices?
    Mr. Azar. Thirty-four billion dollars over 10 years.
    Senator Young. Okay. My constituents will be happy to know 
that. Thank you.
    Mr. Azar, you participated last year in a symposium at the 
Manhattan Institute.
    Do you recall that?
    Mr. Azar. I do. Yes.
    Senator Young. Okay. At that symposium, you stated that, 
``We are on the cusp of a Golden Age of pharmaceutical 
breakthroughs, but the problem is our outdated system for 
paying for prescription drugs is threatening to squelch patient 
access to this recent and revolutionary burst of innovation by 
shifting a crushing burden directly onto individuals.''
    A lot of Hoosiers, a lot of Americans pay for their drugs 
through Health Savings Accounts.
    Is there something we could do with HSA's, or other 
vehicles, to help with drug costs?
    Mr. Azar. I do think there is, actually.
    One of the things, when you have a high deductible plan, 
and that is one, say, you have two, three, four, five, $6,000 
dollars that you have to pay out of pocket before the insurance 
starts paying.
    The law says that you cannot use, that the plan cannot 
cover during that period of that deductible unless if something 
is a preventive service.
    But the Government has not put out really good guidelines 
about what can be covered as preventive services so that 
patients could have first dollar coverage in that deductible 
period. That their Health Savings Account could cover those 
preventive services and also changes that would allow more 
money to be put away into Health Savings Accounts, more 
flexibility for use.
    Anything that lets the patient have access to more money, 
or lower co-pays when they walk into the pharmacy, I think, has 
to be part of what we drive toward.
    Senator Young. I have asked you two questions, one about 
your past professional history with respect to drug costs. You 
were able to cite an example where you actually catalyzed a 
process to lower drug costs.
    I asked you about any ideas you might have revolving around 
a narrow issue of Health Savings Accounts. You have put forward 
an idea that could help reduce the cost burden on consumers.
    I am encouraged by that. I hope others are as well.
    I have roughly 40 seconds left. I will note that President 
Trump has indicated Welfare reform will be a major priority for 
his moving forward. It is a priority of mine. Much of the 
policies that fall under the category of Welfare reform are 
under the jurisdiction of HHS.
    I will look forward. I will submit a question for the 
record to you.
    Senator Young. But I want to see what sort of changes you 
anticipate HHS making through executive order as the 
administration is pursuing in other areas to improve our 
Welfare system and serve the least among us in a more effective 
way.
    With that, thank you, Mr. Chairman.
    Mr. Azar. Thank you, Senator.
    The Chairman. Thank you, Senator Young.
    Senator Hassan.
    Senator Hassan. Thank you very much, Mr. Chairman, and 
Ranking Member Murray.
    Good morning, Mr. Azar. Congratulations on your nomination 
and congratulations to your family too. This is a family affair 
and we are very grateful for their willingness to support you 
in this work.
    As you know, New Hampshire has been ravaged by the 
fentanyl, heroin, and opioid crisis, and we are in need of real 
resources to help those on the front lines combat it.
    HHS used a flawed funding formula to allocate resources 
from the 21st Century Cures Act. The hardest hit states, like 
New Hampshire, did not get adequate resources. Now, even though 
we have asked them to change the formula, HHS has declined to 
do that to update the formula for the second year of funding.
    But another big problem is that the Trump administration 
has refused to request additional funding to fight the crisis, 
which has prompted many to question whether the President is 
truly serious about addressing it.
    We need this administration to send a supplemental funding 
request to Congress for additional resources to combat the 
opioid addiction epidemic.
    Mr. Azar, yes or no, if you are confirmed, will you commit 
to me today that you will encourage the Trump administration to 
ask Congress for at least $45 billion in new supplemental 
funding to fight this crisis, a number that has had bipartisan 
support?
    Mr. Azar. Senator, again, thank you, and I am really glad 
we were able to have the discussion about this terrible opioid 
crisis, and the impact in New Hampshire.
    I do not know the number, but what I will commit to you is 
if I am confirmed, I am going to work across the Government to 
assess, ``Do we have the resources we need?''
    If I do not believe we have the resources we need to 
address the problem, work with the President and the Congress 
to do that.
    Senator Hassan. I will tell you that I do not know a 
Governor of either political party who believes we have the 
resources we need. I do not know anybody on the front lines of 
this crisis who thinks we have the resources we need.
    Will you also commit to examining all substance misuse 
funding sources and formulas, and directing, wherever possible 
under you authority, more funds for the states hardest hit by 
the crisis?
    Mr. Azar. I do not know the precise issues around that 
formula, how much is in statute and how much of it is 
discretionary, but absolutely.
    I know your concern about the money going to New Hampshire. 
I certainly, if I am confirmed, will work with you to look at 
that, and see what flexibilities there are, and do we think it 
is the right approach.
    Senator Hassan. The issue here is that the money has been 
formulated, been distributed, basically, on population as 
opposed to the overdose death rate per capita, in particular 
states.
    Let us move on to another issue.
    The drug company Allergan has recently engaged in 
unacceptable behavior to shield the patents of its dry eye drug 
Restasis from review in order to prevent generic products from 
entering the market, and denying consumers more affordable 
alternatives.
    In September, Allergan announced it had paid a Native 
American tribe to take ownership of the patents. Then Allergan 
licensed the patents back from the tribe continuing to sell the 
drug as usual, exploiting the doctrine of tribal sovereign 
immunity to protect its profits.
    Allergan is renting the tribe's tribal sovereign immunity 
in order to protect its profits. The move ultimately is meant 
to stop generic versions of Restasis from coming to the market, 
which would be cheaper for patients.
    This outrageous, first of its kind deal was called a ploy, 
recently by a Federal district court judge. I would like to 
know what you think about this deal.
    Yes or no, should drug companies like Allergan be allowed 
to rent out tribal sovereign immunity in order to shield their 
patents from review?
    Mr. Azar. I do not know, as Secretary, if I would have any 
actual enforcement issue, so I do want to be careful----
    Senator Hassan. Yes, I understand that.
    Mr. Azar----about any particular situation.
    Senator Hassan. Right.
    Mr. Azar. But I would say I would share your concern about 
any type of abuse around extensions of patent or protecting 
from whatever legitimate processes there are for evaluating 
validity of patents.
    Senator Hassan. Well, I appreciate that. If you are 
confirmed, I hope you will work with me, and others, on this 
issue understanding that there are multiple agencies that have 
some jurisdiction here.
    I wanted to touch on another issue. As the country recently 
learned of the case of Jane Doe, a 17-year-old young woman, who 
was forced to continue her pregnancy against her will for over 
a month while in the custody of a shelter that contracts with 
HHS overseeing unaccompanied minors.
    Jane Doe was eventually able to receive the abortion that 
she decided was necessary for her and that a court confirmed 
was necessary for her. But because of this case, it has come to 
light that the director of the HHS office, Scott Lloyd, used 
very disturbing tactics to block abortion access for the young 
women in these shelters.
    He prevented minors seeking abortion care from meeting with 
attorneys. He suggested placing pregnant minors with sponsors 
who would override the minor's choice about her pregnancy 
rather than placing her with family members. He personally 
visited pregnant minors to pressure them to continue their 
pregnancies.
    Political appointees in Washington, DC at HHS should not be 
imposing their own ideology on these young women, nor should 
they be coercing them or shaming them for their choices.
    If confirmed as Secretary, do you agree that you have an 
obligation to follow the Constitution and all the laws of the 
United States, even those you may not personally agree with?
    Mr. Azar. I am lawyer and I take the obligation to follow 
the laws and the Constitution, as interpreted by the courts, as 
a solemn obligation. Absolutely.
    Senator Hassan. Well, I am glad to hear that.
    The Chairman. Thank you.
    Senator Hassan. I know I am running over, and I will 
follow-up on the discussion with you.
    Thank you.
    Mr. Azar. Thank you, Senator.
    The Chairman. Thank you, Senator Hassan.
    Senator Cassidy.
    Senator Cassidy. Mr. Azar, nice to see you. Enjoyed our 
conversation yesterday. Thank you.
    I am a physician. I worked in the public hospital system of 
Louisiana taking care of the uninsured and the poorly insured, 
which is to say, Medicaid patients.
    Now, there is a lot of data out there that patients covered 
through Medicaid oftentimes have worse outcomes than those who 
are covered through other forms of insurance, even when 
correcting for disease burden and socioeconomic factors.
    Clearly, we should have a bipartisan interest in having 
outcomes data that shows who is doing a good job and who is 
not. If someone is doing a good job, reward it; and if they are 
not, figure out why, and try to improve it.
    Fair statement?
    Mr. Azar. I could not agree more.
    Senator Cassidy. Any thoughts about the datasets that are 
currently available?
    I am told that for Medicaid and CHIP, right now, there is, 
in theory, a structure for this outcomes data to be accumulated 
and compared, but in practice, it is not.
    Thoughts on that?
    Mr. Azar. I do not know the dataset, Senator, but if 
confirmed, I will gladly look into that because I do agree.
    We ought to always be evaluating our programs to see what 
works, what does not work. Are there certain programs that work 
better than others? Because our goal is that people have 
affordable care. They have access to care and if one approach 
is better than the other in delivering quality for that, we 
ought to be using any data we have to find that.
    Senator Cassidy. Now yesterday, you were open and meeting 
informally with Senators from both sides to go over certain 
issues.
    I would just ask, at some point, because our Ranking Member 
and Chair have been very good about convening that, what can we 
do as a Federal Government to have better datasets so that 
patient outcomes can be monitored? Because it is an old maxim 
of healthcare, if you do not measure it, it does not improve.
    Mr. Azar. Yes.
    Senator Cassidy. I think we need to measure that.
    Mr. Azar. Yes. Senator, I appreciate your invitation, in 
the event that I am confirmed, to any kind of convened, 
bipartisan process to work through these difficult issues.
    If I am confirmed, I hope what you will find is that my 
style is one where I do not believe I have the answer to every 
problem. These are complex and vexing issues, and I want to 
have an open dialog, back and forth.
    I am a problem solver. My brand is that if there is a 
program that is not working, if it can be made better, I want 
to work on solving that problem. I want to get the best input 
and the best ideas from the directors, everyone here.
    Senator Cassidy. Well, from our perspective, if there is 
something you can do administratively, we do not have to mess 
with it. But if there is something that you need legislatively, 
then we should devote our attention and that would be the 
purpose of this.
    Mr. Azar. But I would also appreciate the ideas. If there 
are ideas about what can be done administratively, I want 
those. I would want those ideas also, if confirmed.
    Senator Cassidy. Then let me have some ideas from you right 
now.
    Public health, there has been a problem. I was working with 
Senator Schatz and some others as regards how to have a public 
health fund so if we get another Zika, it does not take special 
appropriation, just to give you my thoughts on that.
    I compare it to under Katrina, Congress had to come in and 
appropriate money for FEMA to go and respond to Katrina. Now, 
we have figured out no, or before I came in, they figured out, 
``No. Let us just put the money up front so that it can get 
immediately drawn down.''
    From my perspective, we should be doing that for public 
health as well.
    But what thoughts do you have as regards how we can help 
you better respond to public health emergencies?
    Mr. Azar. Well, I was actually, back in the Bush 
administration, one of the architects around Project Bioshield.
    I really see, in preparing for public health emergency and 
response, the benefit of having predictable funding and the 
ability for the Government to be a reliable partner in that 
development process.
    I would be very happy to work with you. Obviously, I cannot 
speak for the administration, but I personally.
    Senator Cassidy. How do you safeguard from the money being 
frittered away on things which are not public health 
emergencies or being used as a slush fund to cover shortages 
elsewhere?
    Mr. Azar. One would have to draw the lines very clear.
    I would share that concern. You would need to make sure it 
is really built-in to a development or response program for 
public health. Public health emergencies like a Zika, like an 
Ebola, or frankly as we have with the countermeasures 
development programs.
    Senator Cassidy. Now, let me also say, and this may just be 
something that I encourage that you monitor.
    Sheldon Whitehouse and I always have to say ``Sheldon.'' If 
I say ``Whitehouse,'' they think 1300 Pennsylvania Avenue--so 
Sheldon Whitehouse and I in the 21st Century Cures Bill put 
forward something for Health IT.
    My physician colleagues just are retiring at age 55 because 
they are just sick of electronic medical records and the 
dampening that has been upon their ability to interact, as well 
as their productivity.
    In the 21st Century Cures, the Health IT act was included 
that gave some directives. Supposedly, it is progressing well. 
But nonetheless trust, but verify.
    Any thoughts about that and how we can ensure that Health 
IT actually becomes an enabler of patient-physician 
relationships, as opposed to an impediment?
    Mr. Azar. I need to be careful here because my father, Dr. 
Alex Azar, may jump to the table here and start telling you 
about all the problems, exactly the problems you are talking 
about.
    Senator Cassidy. I am with you, brother.
    Mr. Azar. I think that when Secretary Leavitt was Secretary 
and we went down. He started the journey on health IT. He was 
adamant. Electrification of health records without 
interoperability is not useful. That is just moving files to a 
different place.
    I am afraid we have done a bit of that where we have 
electrified our record systems, but we have not gotten 
interoperability. We have made it too complex at the point of 
entry with the doctor.
    I would love to work with this Committee and I certainly, 
if I am confirmed, will work within HHS to drive toward 
interoperability in reducing physician burden because it should 
be an enabler, not something that detracts. The doctor's eyes 
should be on the patient, not on the computer screen.
    Senator Cassidy. Fantastic. Amen, brother.
    I yield back.
    The Chairman. During our 21st Century Cures, we veered off 
to the side and held six hearings on Electronic Medical 
Records. All of us are interested in it. We made some progress 
with the last Administration.
    We might set up, I will talk to Senator Murray about a 
roundtable, a less formal way that is bipartisan to try to 
continue that focus over the next couple of years.
    Senator Baldwin.
    Senator Baldwin. Thank you.
    Thank you, Mr. Azar. There has been a lot of discussion 
about experience, insights, as well as potential for conflicts 
already in this hearing today.
    Obviously, experience and insights can be extraordinarily 
helpful, but we have heard from the President that he wanted to 
drain the swamp. We have heard phrases like ``foxes guarding 
the henhouse,'' and the ``revolving door.''
    Noting that, the perspective that you would bring, having 
served in a large pharmaceutical corporation in a leadership 
post, brings a very specific perspective, especially as we 
tackle one of the critical problems of our day, the high cost 
of prescription drugs, oftentimes lifesaving and life extending 
medicines for our constituents.
    We had a hearing recently in this Committee on drug prices, 
and I felt that there was a lot of finger pointing from the 
folks who were at it, talking about whether they were from the 
perspective of Big Pharma, or Pharmaceutical Benefit Managers, 
or all of the other players in this system and citing 
complexities. Citing, ``It is their fault, not ours.''
    But because of your background in the pharmaceutical 
industry, I would like to not hear finger pointing, but what 
can be done.
    I have many constituents who share their very personal 
stories about their challenges with the increasing and 
skyrocketing costs of, again, lifesaving or life extending 
medications.
    Greg from Stoddard, Wisconsin has two adult sons, both with 
Type 1 diabetes, and they are now expending over $1,000 a month 
just to maintain insulin and test strips.
    When you were President of Eli Lilly, you were there during 
a time that there were really radical increases in insulin 
prices. It increased more than 1,000 percent since 1996 and 
over 200 percent during your tenure.
    Can you tell us--and more specifically Greg and his two 
sons with Type 1 diabetes--why Eli Lilly and other companies 
are systematically increasing the list prices of drugs that are 
already on the market?
    Mr. Azar. Senator Baldwin, thank you for that question and 
also thank you. I really enjoyed our discussion the other day 
on this and other issues.
    First on the finger pointing, I have actually been really 
clear even when I was at Lilly on this issue of drug pricing. 
Finger pointing is not a constructive enterprise.
    Everybody owns a piece of this. Everybody in the system 
owns a piece of this, and I think the Government owns a piece 
of this. That is why I want to serve because I think that the 
skill, the experience that I bring can help me with the 
Government on drug changes. One company cannot actually 
necessarily impact.
    Senator Baldwin. Right. I appreciate that.
    Mr. Azar. Yes.
    Senator Baldwin. But my question specifically is what would 
you tell Greg and other constituents about Eli Lilly's role?
    Mr. Azar. Yes. The insulin prices have been significant, as 
increases have been significant for all drug prices pretty 
much. The problem is that system. This system makes it so that 
Greg and his kids----
    Senator Baldwin. The system. I should just tell them it is 
the system?
    Mr. Azar. The system has to get fixed. That is the problem. 
That is the problem.
    Senator Baldwin. What about the drug manufacturers----
    Mr. Azar. Yes.
    Senator Baldwin----are the starting point.
    Mr. Azar. The prices.
    Senator Baldwin. They set the list price.
    Mr. Azar. Yes.
    Senator Baldwin. What should I tell Greg about the 200 
percent increase during the time you were there in the price of 
insulin?
    Mr. Azar. Is that what we need to do is work to fix. That 
Greg and his kids have insurance that covers that insulin. They 
have low out of pockets. So that the drug companies----
    So that we have got to get the list prices down also. We 
need to come up with, they have gone up.
    Senator Baldwin. That starts with the drug manufacturers.
    Mr. Azar. It does. You are correct.
    Senator Baldwin. This feels reminiscent of the hearing we 
just had. It is a complicated system and it is this and that.
    It starts with the manufacturers setting the list price.
    Now, we talked, and I see I am already hitting my time, and 
I had lots of questions. Maybe we will have a second round.
    But you have talked about generic and branded competition. 
You have talked about citing the gaming of the patent system 
and exclusivity. There was a bit of Q and A about re-
importation.
    The two things I wanted to talk about, should we get a 
second round--or I may submit written questions--is the role of 
transparency and getting the pharmaceutical companies to 
justify their increases in price. I have a bill, along with 
Senator McCain, to require that for companies planning on 
increasing their prices.
    Second, the role of negotiation, somebody in your role, 
directly with the pharmaceutical manufacturers.
    The Chairman. Thank you, Senator Baldwin.
    Senator Isakson.
    Senator Isakson. Thank you, Chairman Alexander.
    Welcome. Glad to have you. I look forward to our meeting 
tomorrow. I am glad we did not have our meeting before this and 
ask you questions. I might have been talked out of asking you 
had you met with me before.
    But having listened to your testimony, having heard Ms. 
Warren over the years, having been part of the re-importation 
debate over the years, being a Senator and advised a lot of 
pharmaceuticals myself, the cost of pharmaceuticals, the 
pricing of pharmaceuticals, the gaming of the system, as you 
referred to it in your remarks, is a huge issue.
    I would like to give you, at the risk of being 
presumptuous, give you a homework assignment that I hope 
Chairman Alexander and Senator Murray will back me up on.
    Will you come back to us in 6 months with your 
recommendations on what you are going to do to help end the 
gaming of the system in terms of pharmaceuticals?
    Mr. Azar. Absolutely.
    Senator Isakson. I think you are uniquely qualified having 
been a CEO of a major pharmaceutical company, knowing what you 
know, and taking on the responsibility you are about to take 
on, to forthrightly come to us and say, ``These are the things 
that are being abused,'' by either the pharmaceutical 
companies, or manufacturers, or physicians, or whoever it is. I 
am not interested in blame.
    Mr. Azar. Yes.
    Senator Isakson. I am interested in solutions.
    Let us try and end the gaming of the system because 
oftentimes these debates and responses to the questions we ask 
end up obfuscating solutions that otherwise might be talked up 
because we do not do that. I would appreciate it.
    Would you be willing to do that?
    Mr. Azar. I would look forward to the opportunity.
    Senator Isakson. Second, to return the favor. I live in 
Atlanta, Georgia. I represent the State of Georgia in the U.S. 
Senate and I have been a representative for 20 years in the 
Congress of the United States.
    It is the home of CDC, which is the world's health center, 
which got very little notoriety but, in fact, solved the Ebola 
problem when it contained an outbreak and ended its spread; the 
same thing with Zika. They did it in partnership with four 
institutions around the country that had built isolation 
chambers; Emory University in Atlanta being one of them.
    We were able to get the people under care, isolate them, 
treat them. They, by the way, all four of them went to Emory, 
survived an Ebola infection.
    That type of partnership is what we are going to have to do 
for the avian flu at some time in the future and many other 
things.
    I want your commitment that you will continue to advocate 
for CDC, and its funding, and its ability to meet the 
challenges of the 21st century that we do not yet know what 
they are. But we know the solution will lie in our ability to 
be prepared when they come.
    Mr. Azar. Senator, the CDC, and its leadership, and its 
career staff are the envy of the world, and I share that view.
    Senator Isakson. They have saved a lot of lives.
    Mr. Azar. Amen.
    Senator Isakson. Prevented so many tragedies from happening 
that it is just unbelievable----
    Mr. Azar. They have indeed.
    Senator Isakson----what they have done.
    Last, this may seem to be a silly question. I was a 
salesman all my life. I was on commission income all my life.
    The Medical Loss Ratio in the Affordable Care Act includes 
the cost of a sales commission as a part of the Medical Loss 
Ratio formula. Which, in effect, put most people who sold 
health insurance to individuals who bought in the spot market 
out of business because the commission they would be paid, 
although very modest, would throw it over the 85 percent cost 
ratio. Therefore, they did not do it.
    Most Americans today, who would buy in the spot market or 
go look to try and find a way to get insurance, there is no 
financial insurance for anybody and no financial security for 
anybody to offer it to them because they are priced out because 
of the Medical Loss Ratios, the formula.
    Senator Coons from Delaware, a Democrat and I, have 
introduced legislation 3 years in a row to end that by taking 
it out of the calculation for Medical Loss Ratio which, I 
think, will expand the access and exposure to citizens who need 
healthcare can get it.
    Would you help us with that to see if we can get that 
through?
    Mr. Azar. Senator, I would be very happy to work with you 
in looking at that.
    It is an issue I had not really focused on so I am glad you 
have educated me today on that. I had not known of that concern 
before.
    Senator Isakson. We will use some of our time tomorrow to 
do that.
    Mr. Azar. Thank you.
    Senator Isakson. Thank you very much.
    Thank you, Mr. Chairman.
    The Chairman. Thank you, Senator Isakson.
    Senator Franken.
    Senator Franken. Thank you, Mr. Chairman.
    Congratulations on your nomination, Mr. Azar.
    I would like to ask you a few short yes or no questions, if 
that is Okay.
    Mr. Azar, are you aware that the ACA required health plans 
to cover evidence-based preventive health services free of 
charge? Right?
    Mr. Azar. Yes, there is a provision in there that requires. 
I think HRSA determines preventive services and then those are 
part of the Essential Health Benefits in the ACA, if I 
understand the framework correctly.
    Senator Franken. Are you aware that HHS commissioned the 
Institute of Medicine--an independent, nonpartisan organization 
of highly respected experts on health and medicine--to review 
what preventative services are necessary for women's health and 
well-being? Then on that basis, the Institute of Medicine 
recommended coverage for all FDA approved birth control methods 
free of charge?
    Mr. Azar. I believe that is the case. Yes.
    Senator Franken. Do you agree with the Institute of 
Medicine's conclusion that access to free birth control is 
vital to women's health and well-being?
    Mr. Azar. Senator, separate from the issue of any birth 
control, or which ones should be covered, one of the principles 
that we have around thinking about the access to insurance is 
that all of the insurance that the individual wants to acquire 
and the level of coverage that they want.
    If I have concerns, my concerns are actually at a much more 
precedent level. Not about this coverage for this drug, that 
product, this one or the other, but rather should there be 
flexibility for the individual to choose the type of insurance 
package they want.
    No animus toward any particular type of preventative 
service. It is more that there ought to be, our system ought to 
enable flexibility in there that does not exist with the 
current framework.
    Senator Franken. But you agree the Institute of Medicine's 
conclusion to that free birth control is vital to women's 
health and well-being.
    Mr. Azar. I could not speak. I have not studied the IOM 
report. Obviously, we at HHS have very important programs 
through Title X and otherwise to provide family planning 
assistance and services.
    Senator Franken. But do you agree with the Institute of 
Medicine's conclusion that access to contraception free of 
charge reduces unintended pregnancy, which in turn reduces 
frequency of abortions?
    Mr. Azar. I have not studied it. It seems to make some 
sense as you state it.
    Senator Franken. Okay. Do you agree with the Institute of 
Medicine's conclusion, and this is their conclusion, that 
reducing unintended pregnancy also reduces the health risks 
associated with such pregnancies? That contraception helps 
women to increase the length of time between births, which 
reduces maternal mortality and pregnancy related complications?
    Mr. Azar. I think we all share the goal that unintended 
pregnancies, especially by teens, is something we want to work 
to prevent, and we want to work to educate, and we want to use 
our programs to support that.
    Senator Franken. In light of this, do you agree with the 
Trump administration's actions to undermine the access to birth 
control?
    Mr. Azar. On that issue, that is a balance between the 
Essential Health Benefit and the conscience of the 
organizations involved.
    As I mentioned earlier, I think it was close to only 200 
organizations. Whereas the actual Obamacare, the Affordable 
Care Act implementation there around the contraception mandate 
actually even excluded tens of millions of people who were in 
grandfathered plans. This conscience exception has a much 
smaller impact, I believe.
    Senator Franken. I just want to focus here on the science. 
The law requires the preventive services be evidence-based and 
this is evidence-based.
    Will you take steps as HHS Secretary to make sure that 
women have free access to contraception?
    Mr. Azar. I will follow the law there, if the law requires 
the coverage, and if the evidence, and the science, and the 
facts support that.
    Senator Franken. You will?
    Mr. Azar. Then we will follow the law there. But I also 
will, as the President has done, and try to balance the 
conscience objections of organizations and individuals there.
    Senator Franken. A number of my colleagues have expressed 
concerns regarding your track record and Eli Lilly's track 
record on drug pricing. I just want to tell you, I share their 
concerns especially in regard to Eli Lilly's actions to spike 
insulin prices.
    But I wanted to move. I am running out of time, so I am not 
going to be able to, but I wanted to get into Medicare drug 
price negotiation. The President has said he is for Medicare 
being able to negotiate in Part D with the pharmaceutical 
companies on the price of drugs.
    Do you agree with the President that Medicare should 
negotiate to lower drug prices?
    Mr. Azar. The President has generally spoken about the 
desire to ensure that Medicare is negotiating and getting the 
best deal possible for drugs.
    Part D actually has negotiations through the three or four 
biggest Pharmacy Benefit Managers that negotiate and actually 
secures the best net pricing of any players in the commercial 
system. I sat on the other side of that. I can assure you of 
this.
    What I would like to do is think about, how can we take the 
learnings from Part D, maybe into Part B? Part B does not have 
negotiation. Part B is the program where when a physician 
administers a drug, like an oncolytic, an M.S. drug, some of 
them are quite expensive. The Government simply pays the sales 
price plus 6 percent.
    How could we think about ways to take the learnings from 
Part D and actually bring lower cost to the system, but also 
lower cost to the patient because they pay a share of whatever 
Medicare reimburses in Part B. That is a double win. It could 
lower for the system and lower for the patient on their out of 
pocket.
    That is the kind of thing I would have energy to see where 
we could actually really save money and improve things for our 
patients.
    Senator Franken. I am out of time, but I would just note 
that the V.A. is able to negotiate for prices for their drugs 
and I think that in Medicare Part D, we should be able to do 
the same thing they do in the V.A.
    The Chairman. Thank you, Senator Franken.
    Senator Roberts.
    Senator Roberts. Thank you, Mr. Chairman.
    Mr. Azar, Alex, thank you for coming. Congratulations on 
your nomination, and thank you for being here today. It has 
already been stressed by Governor Leavitt and my colleague and 
fellow Marine, Captain Young, Senator Young, about your prior 
work at the Department of Health and Human Services, as well as 
the confidence in you shown by the Senate.
    [Cell phone.]
    Senator Roberts. Sometimes we have to multitask here. I 
apologize for that.
    But at any rate, the confidence in you shown by the Senate 
to unanimously confirm you to positions at the agency twice 
already and highlight the strength of your qualifications.
    I appreciate the chance we had to chat. I think it was 
Monday on some particular areas of interest for me, improving 
our rural healthcare delivery system, as well as continuing to 
ensure a safe food supply, and basing nutrition policy on sound 
science.
    You are a Hoosier, but you did find a Kansas girl to marry. 
As the folks in Overland Park, Kansas know, there is nothing 
greater than a Shawnee Mission South Raider. I wanted to make 
sure that you understood that. Thank you for bringing your 
family.
    As both a Member of the HELP Committee and Chairman of the 
Agriculture Committee, I am also a Member on the Finance 
Committee, so we will get another opportunity to talk, I am 
particularly interested in HHS, and more importantly, the FDA's 
work on food and nutrition policy. We talked about that. A 
common message I hear is the need for regulatory certainty.
    Just a moment. I beg your pardon. Will you turn that off? 
Thank you.
    [Laughter.]
    Senator Roberts. More importantly, FDA's work on food and 
nutrition policy. A common message I hear is the need for 
regulatory certainty in particular on the biotech front, which 
is a critical tool for agriculture today.
    Back in January, both FDA and the USDA proposed rules and 
guidance on biotechnology. Recently, at a recent stakeholder 
comments, the USDA's Animal, Plant and Health Inspections 
Service, that is APHIS, has decided to withdraw the proposed 
rule, reengage stakeholders, and solicit comments to create a 
new rule.
    If confirmed, what steps would you take to engage and 
coordinate with other agencies involved with the regulatory 
review of biotech products to harmonize future rulemaking 
efforts?
    Mr. Azar. Senator, I am not familiar on that particular 
rulemaking with the pullback from APHIS, but I can assure you 
that I would share both goals that, I think, you have 
articulated.
    The first is, it is the job of the Government when 
regulating to give clarity. So many enterprises, they want to 
comply. They want to know the rules of the road. Can we give 
clarity?
    The second is, especially in the area of food safety, the 
level of coordination between HHS and the Agriculture 
Department is absolutely essential. It has to be a great 
partnership. They have to work together in this space because 
of the shared jurisdictions there.
    I would commit to you to be an excellent partner along 
with, I am sure, Dr. Gottlieb in working with that.
    Senator Roberts. I appreciate that very much. I would just 
want to make, I want to make one other observation, Mr. 
Chairman.
    I have been watching your children, and I have been 
watching these youngsters over here, and I have been watching 
your dad. Your dad is very proud of you and your wife is, 
obviously, very proud of you.
    I want to tell you young folks, welcome to ``Poli Sci 
101.'' It is a little tough. Politics is not beanbags. We are 
not playing politics here. We are asking questions that many 
members here have on their minds and they are very important 
questions.
    I want you to be proud of your dad. He has done a good job 
in the past. He will do a good job in the future. He will be 
confirmed, in my view, and not only by this Committee, and not 
only by the Finance Committee, but also on the floor of the 
U.S. Senate, and then also by the President.
    That is a long process and sometimes it gets a little 
tough. We ought to be handing out selective earmuffs for young 
people. They could put on earmuffs if it gets a little tough 
for you and then take them off.
    Be proud of your father. He is a good man.
    Thank you, Mr. Chairman.
    The Chairman. Thank you, Senator Roberts.
    Senator Whitehouse.
    Senator Whitehouse. Thank you, Chairman.
    Welcome, Mr. Azar.
    I do not think there is much that you and I are going to 
accomplish today on the question of drug pricing.
    But I hope, very much, that in office you will take the 
side of the American people and not just the pharmaceutical 
industry. Or worse yet, the investors who have raided the 
pharmaceutical industry, with no pharmaceutical background, 
with the sole mission to jack up prices on necessary 
pharmaceuticals, and extract money with monopoly authority. We 
know how to deal with that ordinarily and I hope you will help 
us deal with that.
    I want to talk about a different situation which, I think, 
is an opportunity for considerable bipartisan progress, and I 
want to start with two Rhode Island stories.
    You know what a Medicare ACO is, I assume.
    Mr. Azar. I do.
    Senator Whitehouse. We have two Medicare ACO's in Rhode 
Island.
    One is a very early one, Coastal Medical, which over 4 
years has saved Medicare $28 million relative to its benchmark, 
while maintaining a 99 percent quality score. That makes it one 
of the very best in the country. Its average per member per 
year expenditure is going down, while the satisfaction and 
health of its members are going up.
    Similarly, Integra Community Care Network, it has been in 
less long, but over 2 years Integra has saved Medicare $12 
million relative to its benchmark while achieving a 95 percent 
quality score.
    I say this, not just to brag on Rhode Island providers, but 
because I think it is the answer to a much larger question that 
we face, which is.
    [Charts are shown.]
    Senator Whitehouse. Here is the graph of health 
expenditures, more or less, in my lifetime for the country; $27 
billion to $3.2 trillion. It is a curve that is breaking the 
bank. We have got to figure out how to fix it.
    One of the ways that we can look at fixing it is to look at 
this OECD
    [Organization for Economic Cooperation] chart that I use 
all the time, which shows a lot of our competitor nations right 
here, and there is the U.S.A. It is a big outlier.
    This maps life expectancy and this maps cost per capita. 
That puts us at the highest cost per capita for health 
insurance, for healthcare in the world, and gives us life 
expectancy comparable to the Czech Republic and Chile, well 
below other developed nations that compete with us.
    We are actually beginning to see a little bit of--going to 
my third and final graph--we are actually beginning to see a 
little progress here. Let me explain what this is.
    This top line, the red line, is what the CBO predicted for 
Federal healthcare expenditures back here when it made the 
prediction in 2010. Then events move forward, post-Affordable 
Care Act, and we got here. Sure enough, we were coming below.
    Here in 2017, the baseline was rewritten by the CBO, re-
predicted and the difference in this 10 year budget period, 
between what CBO predicted in 2010 and what it predicted in 
2017 amounts to $3.3 trillion in savings.
    The case that I would make to you is that if we want to 
take on the healthcare cost problem, we have to take it on 
through entities like these ACO's because there is a sweet spot 
where we can bring that cost back from our outlier position in 
the United States, while improving the quality of care. I have 
seen it happen in Rhode Island.
    The reason that the cost is going down for Coastal Medical 
patients is because they get home visits when they are sick.
    Because there is telemedicine that gets their testing 
results in.
    Because a nurse will call them, when they do not hear from 
them.
    Because somebody does a house check to make sure that there 
are not slippery rugs in the hallways that might cause a fall.
    Over and over again, it is better, humane engagement that 
reaches the patient where they are, that has this wonderful 
twin benefit of improving health and the patient experience, 
while also bringing costs down.
    We are not seeing less increase in the cost curve from 
Integra and from Coastal Medical. We are seeing cost per member 
going down.
    Promise me that you will work with us on that. Promise me 
that you will not get ideological when it comes to solving this 
problem and that you will work to solve it in a sensible, 
bipartisan, thoughtful way.
    Mr. Azar. Senator, I would just say amen. Just hearing 
those stories is exciting to me.
    It is, I think, one of the great legacies of Secretary 
Burwell's tenure was launching off so many of the alternative 
payment models that we have out there, and I would like to keep 
driving that forward. That was that third leg of my priorities, 
if I am confirmed as Secretary.
    I think for those of us who care so deeply about improving 
quality, reducing costs in our healthcare system, improving 
integration, coordination. Just thinking about ways we can 
deliver better for our patients and our beneficiaries. There is 
just so much opportunity for bipartisanship here because we 
share so much of the same goals on this. Medicare plays such a 
role.
    It is the only payer that sits there with enough 
concentration of lives to change the system.
    Senator Whitehouse. Correct.
    Mr. Azar. I think United Healthcare, as big as it is, I do 
not think there is a market, maybe, that has more than a couple 
of percent of patients and has to follow what Medicare does.
    I would be so excited to work with you.
    Senator Whitehouse. Well, I am going to invite you to come 
to Rhode Island and see these.
    Mr. Azar. I would love to.
    Senator Whitehouse. They are really doing great.
    Mr. Azar. I would love to do so.
    Senator Whitehouse. I look forward to that visit.
    Mr. Azar. Thank you.
    Senator Whitehouse. Thank you, Chairman.
    The Chairman. Thank you, Senator Whitehouse.
    Senator Casey.
    Senator Casey. Mr. Chairman, thank you very much.
    The Chairman. Excuse me, I made a mistake.
    Senator Murkowski is here and I failed to go to that side. 
If you will excuse me.
    Senator Murkowski.
    Senator Murkowski. Thank you, Mr. Chairman.
    The Chairman. Thank you. I apologize.
    Senator Murkowski. I know I am at the end of the dais and 
came in later, but there is added benefit to being one of the 
later ones and having the full opportunity to, not only hear 
most of your opening comments, sir, but to hear the questions, 
and the inquiries, and your responses back.
    Again, congratulations on your nomination.
    I will also be curious to hear your response to Senator 
Paul's inquiry regarding importation of drugs. I think, 
certainly for those of us in Alaska, where our neighboring 
country, our neighboring state, if you will, is Canada. Many in 
my state wonder why we are not able to do more when it comes to 
safely importing.
    I, too, am curious to know what you might propose in that 
area.
    Senator Baldwin mentioned the hearing that we had some 
weeks ago about drug pricing and, I think, a general level of 
just confusion and bemusement that many of us had. Those who 
were here to provide testimony were engaged in a fair amount of 
finger pointing.
    When you try to drill down to how we can do more when it 
comes from a transparency perspective, I think this is 
something that we all recognize that we can do a better job 
with. Again, I look forward to a more detailed response from 
you.
    We are going to have an opportunity to meet tomorrow. I 
will probably hold more of my Alaska-specific questions for 
that time.
    But one of the other discussions that we have had in this 
Committee recently, as we have been discussing the ACA and some 
of the requirements within it, we had recommendations from some 
who have suggested that the Navigator Program that is currently 
in place, no longer needs to be funded. The President really 
axed it not too many months ago.
    It was pointed out that not all parts of America are 
equally situated. We do not have a drugstore on every corner in 
Alaska. In most of my communities, we do not have a drugstore. 
The role that the Navigators have played in helping to walk 
many Alaskans through the intricacies of insurance, and what is 
available, has been important to us.
    Nobody has really asked that question here today, so I 
would ask for your views, your plans.
    What do you see the role of Navigators moving forward? How 
can you provide assurances that, again, in areas where we 
simply do not have the professionals that could assist 
individuals, that they know what their options are?
    Mr. Azar. Senator, thank you.
    It is good to see you again. I think the last time was in 
Anchorage that I got to see you when I was serving as Deputy 
Secretary, and I look forward to discussing Alaska issues with 
you when we meet. I doubt there will be a secretarial nominee 
who has spent as much time in Alaska as I have.
    Senator Murkowski. Which we look forward to that because, I 
think, you recognize that there are some unique aspects.
    Mr. Azar. There is, indeed.
    Senator Murkowski. Your focus on behavioral health with 
Native peoples----
    Mr. Azar. Yes.
    Senator Murkowski----is something that I am interested in 
exploring some more.
    Mr. Azar. Absolutely.
    In terms of the Navigator Program and just outreach, my 
views, as it is with so much of programs, is what works, do 
what works. I am not at the Department, so I do not have the 
data. I have not seen everything.
    My understanding about the changes in the Navigator Program 
were focused on Navigator Program elements that were not 
working in renewing and funding Navigators that were able to 
demonstrate results in doing the work. I do not know the 
specifics about the Alaska situation.
    I can only tell you that I do genuinely ``get it'' in the 
sense of understanding the uniqueness of the very frontier 
nature of so much of Alaska, and would be very happy to work 
with you on that, if I am confirmed, to see what are the ways 
that we deal with it.
    But for me, it is really just what works. What is 
effective? What works? What delivers for the program?
    Senator Murkowski. I think I said pharmacies, and it is not 
only pharmacies.
    Mr. Azar. Yes.
    Senator Murkowski. But it also those who help us navigate 
through the insurance side.
    Mr. Azar. Right.
    Senator Murkowski. We do not have insurance companies on 
every corner as well. I will look forward to discussion on 
that.
    Very quickly, there has been a lot of focus also on women's 
healthcare, preventive care, eliminating the risk of unwanted 
pregnancies. I happen to believe that the more we can make 
contraception available and affordable to women, the better off 
we are.
    I have long wondered why we are still these many, many, 
many decades after prescription birth control was made readily 
available, why we have been so reluctant to move to over the 
counter products for birth control. It not only makes the 
product more expensive as we continue to see. It is just kind 
of a flat amount out there, but you also have the requirement 
for a medical appointment in order to get that prescription.
    Do you see a way or an opportunity for us to reduce the 
barriers for more affordable birth control pills, 
contraception, and in a way that can really help women in 
gaining greater access to contraception?
    Mr. Azar. The over the counter regulatory regime, as you 
know, is this OTC monograph procedure that Commissioner 
Gottlieb, I am very glad, has said was probably out of date in 
the 1970's and needs updating, needs a lot of work. whether 
legislatively, or at FDA, to really speed the approval of 
products for over the counter for the reasons you said in terms 
of cost, available, cost to the system, et cetera.
    Of course, there are standards. There are scientific and 
legal standards that have to be met by the sponsors of a 
product in terms of the ability, if I remember correctly, 
usually the ability to self-diagnose, self-treat. There are 
user studies that basically need to be conducted. It would be 
driven by that, would be my view on any product that the FDA 
would have to decide on.
    But I think the regulatory system really needs a close look 
at and I would be delighted to work with Commissioner Gottlieb 
on how we just generally think about over the counter and 
improving availability of OTC products for people.
    The Chairman. Thank you.
    Senator Murkowski. Well, I would encourage you and we will 
have an opportunity to continue our conversation.
    Mr. Azar. Yes.
    Senator Murkowski. Thank you, Mr. Chairman.
    The Chairman. Thank you, Senator Murkowski.
    Now, Senator Casey.
    Senator Casey. Thank you, Mr. Chairman.
    Mr. Azar, good to be with you. We had some opportunity to 
talk in my office yesterday. I am grateful for that. Grateful 
for your willingness to put yourself forward again for this 
work that is difficult.
    I want to especially thank your family and your extended 
family for their commitment. Often as much as public officials 
work hard, their families often sacrifice more. I appreciate 
that commitment your family has made.
    You and I have a home state in common in terms of where we 
were born, not where we were raised, but I know you are a 
Johnstown native. I am a Scranton native and still live there, 
but we have a lot of disagreements on public policy issues, 
especially around healthcare, and I will get to those.
    But I want to start with something fundamental and I wish 
we did not have to start here. But because of the interaction 
between Dr. Price, Secretary Price and this Committee, I have 
to ask this question.
    When Dr. Price came before this Committee prior to his 
confirmation, Members of this Committee submitted a number of 
questions to him to answer on the record in writing and he did 
not provide a lot of responses. I am going to be very precise 
in this question.
    Do you commit to provide answers to all--operative word 
``all''--all the questions you receive following appearances 
before this Committee?
    Mr. Azar. I will certainly be happy to comply with the 
Senate's nomination procedures in the nomination setting and 
then, of course, in ongoing appearances before the Committee 
with the protocols and procedures of the Committees in the 
Senate.
    Senator Casey. But do you agree that answering questions 
for the record posed by Committee Members during the nomination 
process is part of that compliance?
    Mr. Azar. Senator, what I do not know is just what the 
protocols are between the HELP Committee and the Finance 
Committee there in terms of questions for the record. I just 
apologize. I am just not familiar with the customs.
    When I was, as General Counsel and as a Deputy Secretary 
nominee, the hearing before the HELP Committee did not occur 
there. I am just not knowledgeable.
    I would be happy to get back to you on that question. I do 
not know the protocols. I am sorry.
    Senator Casey. Well, I will take that as a tentative yes 
for now, but I hope you would familiarize yourself with those 
rules and then respond accordingly.
    We should not have to engage in a back and forth on basic 
questions for the record.
    I wanted to ask you about, in light of the debate on 
healthcare, the substantial debate that has been undertaken 
over the last number of months on the Affordable Care Act, and 
especially Medicaid, at least from my point of view, especially 
Medicaid. In addition to that debate, some of the statements 
you have made. I will not catalog the statements you have made 
that have been critical in one way or the other of the 
Affordable Care Act and commenting on the process.
    Now, you are seeking appointment, a confirmation vote on 
HHS Secretary and that, of course, would confer on you 
responsibilities you do not currently have.
    In light of that, and in light of the debate, and just to 
be very clear, I want to be very precise in asking this.
    Do you commit to faithfully implementing the Affordable 
Care Act?
    Mr. Azar. If I am confirmed as Secretary, my job is to 
faithfully implement the programs as passed by Congress, 
whatever they are. That would include, if the Affordable Care 
Act is the law of the land and remains such, to implement it as 
faithfully as possible in ways, and my hope would be to 
implement it in ways, if it remains.
    I obviously believe, the Administration believes that 
statutory changes would be good and appropriate to replace that 
system.
    But if it remains the law, my goal is to implement in a way 
that leads to affordable insurance, leads to choice of 
insurance, insurance that leads to real access not a 
meaningless insurance card, and insurance that has the benefits 
that people want, not what we say in D.C. for them.
    Senator Casey. Let me ask you as well about an issue that, 
frankly, does not get enough attention. It is the efforts that 
have been made by the Administration to undermine the 
Affordable Care Act. That is my view of it. I use the word 
``sabotage,'' and I think that is an appropriate description.
    Let me define more specifically what I mean. When I say 
``sabotage'' of the Affordable Care Act, I mean the following.
    No. 1, drastically cutting funding for advertising and 
outreach activities.
    No. 2, terminating cost sharing reduction payments.
    No. 3, spending funds meant to promote enrollment on a P.R. 
campaign to, instead, undermine the law and support repeal of 
the ACA. Dollars should not be spent for that.
    No. 4, spreading falsehoods and misinformation about the 
health of the marketplaces. It is one thing to be critical and 
concerned about it, it is another thing to spread falsehoods.
    No. 5, working to rollback health insurance protections and 
undermine coverage.
    That is the predicate for the question. Would you oppose 
those efforts knowing that you have a responsibility to 
faithfully implement the law? Would you oppose those efforts 
that I described broadly as sabotage? Yes or no.
    Mr. Azar. Well, I would disagree that there is any effort 
to sabotage the program. People want to make the program work.
    The CSR's was a legal decision that Congress had not 
appropriated the money. Other elements, I can speak for myself 
about how I would approach.
    Senator Casey. How about cutting funding on advertising and 
outreach activities? Is that appropriate or inappropriate?
    Mr. Azar. The advertising cuts, actually, put the 
advertising for this program, now many years into it, at the 
level of Medicare Part D and Medicare Advantage.
    At some point, these insurance companies have to do their 
own doggone job to fund their own advertising.
    Senator Casey. But are you asserting that the advertising 
dollars were not cut?
    Mr. Azar. No, they are cut. They were cut to the level now 
that, I believe, is comparable to Medicare Part D and Medicare 
Advantage annual advertising funding.
    The Chairman. We are running out of time.
    Mr. Azar. I think these insurance companies should stand 
there on their own two feet.
    Senator Casey. We will have more time to engage in this.
    Mr. Azar. Okay.
    Senator Casey. Thank you very much.
    The Chairman. Thank you, Senator Casey.
    Senator Kaine.
    Senator Kaine. Thank you.
    Mr. Azar, good visiting with you yesterday. I have one 
question about each of your four goals, but before I do, I will 
tell you what I said to you yesterday.
    What I am looking for from you is a commitment to the 
healthcare safety net broadly defined. I voted against your 
predecessor because he had commented negatively about Planned 
Parenthood, CHIP, Medicaid, Medicare, and the Affordable Care 
Act.
    His brief tenure at the HHS proved that he was not kidding 
and I do not think we can have an HHS Secretary who does not 
support the healthcare safety net. That is what I am looking 
for from you.
    Your first goal in your written testimony, you say drug 
prices are too high. As a Member of the Aging Committee, I kind 
of became convinced, Senator Collins was our leader, that there 
is a new model out there that is ``patients as hostages''. 
Patients who need drugs--who cannot afford to go without them, 
without risk to their life or health--are treated as hostages 
by pharmaceutical companies in some circumstances.
    There was a story in the ``Washington Post,'' ``Why 
treating diabetes keeps getting more expensive,'' in October 
2016, and this is a quote.
    ``According to the Washington Post's analysis of Truven 
Health Analytics's data, over the past two decades Eli Lilly 
and Novo Nordisk raised prices on their human insulin 450 
percent above inflation, closely in sync.''
    Convince me that Eli Lilly's pricing activity on insulin 
was not part of this ``patients as hostages'' business model.
    Mr. Azar. Senator, as I said in my remarks in response to 
Chairman Alexander earlier today, insulin prices are high and 
they are too high. This system that we have got, it may fit for 
the stakeholders behind the scenes, but for the patient that 
you are talking about, we have to recognize it is not working.
    Senator Kaine. Do individual actors in the system have no 
culpability? Do the drug companies themselves have no 
culpability for this?
    Mr. Azar. They are making the decisions. The choices are 
happening. I think everybody, everyone shares blame here. 
Everyone shares blame here throughout and we need, what we have 
got to do is I want to be a productive engine, if I can be 
Secretary, to work with you on solutions to fix that for the 
patient.
    Senator Kaine. Let me ask you about your second goal.
    ``Second, we must make healthcare more affordable, more 
available, and more tailored to what individuals want and need 
in their care.'' Amen, amen.
    Then you have a sentence that is interesting. ``We must 
address these challenges,'' you cite challenges, ``For those 
who have insurance coverage, and for those who have been pushed 
out, or left out, of the insurance market by the Affordable 
Care Act.''
    That is your only reference to the ACA in your testimony, 
and I think it was interesting that you talk about people who 
have been pushed out or left out of the market by the ACA. Of 
course you know that the uninsurance rate has dramatically 
reduced in the country following the passage of the Affordable 
Care Act.
    I am not arguing that it is perfect, but if you just read 
your statement, it suggests that there are fewer people insured 
because of the ACA.
    We had the Surgeon General, Dr. Adams, in here recently 
from Indiana, a Hoosier just like you. He said the uninsured 
rate in Indiana has gone dramatically down because of the 
Affordable Care Act because of the combination of Medicaid 
expansion and the availability of premiums to help folks 
afford.
    In looking at this question, are you going to execute and 
be part of the wrecking crew? I do not think that is really an 
accurate or a really very fair statement.
    Mr. Azar. Well, I am happy to explain. I believe we can do 
better.
    Senator Kaine. I do too.
    Mr. Azar. I believe both for the folks that are in the 
individual markets right now that too many of them are paying 
too much for insurance. Too many of them have insurance that is 
not really useful.
    Senator Kaine. But was that your opinion before the 
Affordable Care Act passed?
    Mr. Azar. I thought that would happen. I thought that would 
happen given how it was structured in statute, unfortunately.
    Senator Kaine. Yes, but the numbers of people uninsured in 
this country were dramatically higher than they are now when 
you were at HHS in your first term.
    Mr. Azar. I have always been, and I would want to work with 
you, our goals are the same in the sense that we want to 
improve access to affordable insurance. The President wants 
this. I want this. I think we may only differ about tactics and 
approaches.
    Senator Kaine. Let me.
    Mr. Azar. My point was the forgotten man and woman who is 
not in that individual market because the insurance was not 
affordable for them.
    Senator Kaine. Let me ask you.
    Mr. Azar. I want solutions for them.
    Senator Kaine. ``Third, we must harness the power of 
Medicare to shift the focus on our healthcare system from 
paying for procedures and sickness to paying for health and 
outcomes.'' Amen.
    Why did you not mention Medicaid? I mean, Medicaid is a 
very important part of your portfolio, and I found it 
interesting, in reading that sentence, that you did not say a 
word about Medicaid, nor do you mention Medicaid at all in your 
entire testimony.
    Mr. Azar. The only reason I do not mention Medicaid in that 
context, Senator, is not a lack of any kind of commitment to 
Medicaid. It is really that Medicaid does not have the same 
kind of payment rules that Medicare has at the national level. 
That was my focus. It is not a lack of commitment.
    Senator Kaine. Can I say this? I was a Governor, and I ran 
a Medicaid program, and am an ex-Governor.
    Mr. Azar. Yes.
    Senator Kaine. But it is interesting, why would you not----
    Would you not also agree that we can focus the paying for 
procedures and sickness, shift that focus to paying for health 
and outcomes? The Medicaid program can be part of that as well.
    Correct?
    Mr. Azar. It certainly could. To Governors, if Governors 
are willing partners to try and drive that, absolutely. 
Medicare, as the Secretary, has more levers in his or her 
control to do that.
    Senator Kaine. Would you try to do the same thing in 
Medicaid?
    Mr. Azar. Absolutely. Of course.
    Senator Kaine. Okay.
    Mr. Azar. If we can make Medicaid better, it will let us 
serve more people.
    Senator Kaine. Thank you.
    The Chairman. Thank you, Senator Kaine.
    Senator Murphy.
    Senator Murphy. Thank you, Mr. Chairman.
    Congratulations on your nomination, Mr. Azar. I enjoyed our 
conversation, and I was very open to your nomination.
    I am very, very concerned about your answer to Senator 
Casey's series of questions, and so, I just want to state it to 
you one more time and give you a second chance here.
    This Administration has shortened the open enrollment 
period by half. It has cut outreach funding by 90 percent. It 
has cut funding for Navigators by 40 percent. It has pulled out 
of state enrollment partnerships.
    Is your testimony here today that this is all in service of 
an effort to make the ACA better? Do you really believe that 
the goal of this Administration is to help people sign up for 
the Affordable Care Act?
    Mr. Azar. Obviously, I am not in the Government. I do not 
have access to all of the data.
    My understanding is, and I cannot validate this from the 
outside, was that the choices made were about what is working 
and what is not working, and there is no sense funding any 
aspects of the program that are not working well. Also a policy 
decision around advertising that it is time for that to be 
regularized in its amount of funding around advertising.
    Senator Murphy. You think President Trump is taking these 
actions in the goal of making the Affordable Care Act work 
better?
    Mr. Azar. I do not know that President Trump was involved 
in those decisions. Those are probably decisions made at the 
HHS level or made as a matter of budgeting.
    But I think the goal is with the program you have got, do 
as best you can. This one has a lot of problems in it. If the 
Alexander-Murray bipartisan package here helps, it is a good 
stopgap.
    Senator Murphy. But what has cutting the open enrollment 
period in half to do help?
    Mr. Azar. I do not know. I was not, again, involved nor did 
I study the comments on the enrollment period change.
    But the enrollment period, my understanding, went from 90 
days to 45 days which, I do not know about the Senate, but most 
of us have 45 day open enrollment periods for shorter, more 
efficient programs to allow for certainty of beneficiaries, and 
let the plans then know who is in their plan so they can plan 
predictably for the following year.
    If you run right up to the end of the year there, it is 
harder for the plans to set their actuarial basis for the open 
enrollment period and the pricing. Then if you run that open 
enrollment period right up to the end there, I know this from 
when we launched Part D and Medicare Advantage that first year, 
the closer you run up to January 1 on that one, it is very hard 
to implement effectively and efficiently in the coming year.
    Senator Murphy. Yes, my understanding is that this is not 
the insurers begging for the open enrollment period to be cut 
in half.
    Mr. Azar. I do not know.
    Senator Murphy. Put that next to an evisceration of all of 
the programs that would help people understand the fact that 
the open enrollment period has been cut in half. Listen, I just 
think it is strange.
    Mr. Azar. I was not involved in that.
    Senator Murphy. Okay. You said that there are things that 
the HHS Secretary could be doing to make the open enrollment 
period work better.
    What do you think that you could do in the face of these 
changes to make open enrollment work better, to make sure that 
people have the ability to choose wisely within the exchange? 
If you say that these are changes that are made in the service 
of making the open enrollment period better. What else are you 
thinking can be done?
    Mr. Azar. Just to clarify. I do not believe I said that 
these were changes to make it better, but rather to eliminate 
what, I think----
    Again, I am on the outside. I am not sitting there at HHS 
looking at data, running the program. I do not know the status 
of thinking on each individual element there. My point is if 
something is not working, why are we funding it?
    If the view was that the Navigator program, if certain of 
those vendors are not delivering, delivering one beneficiary 
enrolled and receiving a lot of money, say, why keep funding 
that? That would be my perspective in looking at it. Then using 
your resources to put it on whatever the most effective 
outreach and enrollment programs happen to be. That would be 
the approach I would follow.
    I do not know. I am not there. I have not been involved. I 
have not been at HHS for the Affordable Care Act initiation or 
implementation. I just have not studied each of the individual 
programs there.
    Senator Murphy. Let me follow-up on some questions that 
Senator Warren was asking.
    I agree with her. Experience in the private sector should 
not be disqualifying. What we want to make sure is that you are 
not simply bringing your advocacy on behalf of the industry you 
used to work for into Government.
    Pharma has a number of major legislative priorities, faster 
FDA approval processes, continued prohibition of Medicare 
negotiating directly with drug companies, continued 
legalization of direct to consumer advertising.
    I know you have been critical of specific practices of 
individual drug companies.
    Is there any major issue on Pharma's legislative advocacy 
list that you disagree with?
    Mr. Azar. Well, Senator, if I get this job, my job is to 
enhance and protect the health and well-being of all Americans. 
It is not to----
    Senator Murphy. I get it.
    Mr. Azar----implement pharma's agenda.
    Senator Murphy. Just to give us an example of where you 
will oppose?
    Mr. Azar. I do not have pharma's policy agenda.
    Senator Murphy. But you worked?
    Mr. Azar. That is how little focus. I have been gone for a 
year. I do not know what their list of agenda items is, 
Senator.
    Senator Murphy. Okay.
    Mr. Azar. That is not my area of focus.
    My area of focus is the President's agenda, and how I can 
work with this Congress to try to make the programs of HHS 
better in the interest of all Americans, and not the interest 
of any trade group. Not the interest of any company.
    This is the most important job I will ever have in my 
lifetime and my commitment is to the American people, not to 
anywhere that I have worked in the past or any industry I have 
been connected to in the past.
    Senator Murphy. I thank you for that answer.
    Thank you.
    The Chairman. Thanks, Senator Murphy.
    I think we have some Senators who want to ask additional 
questions, so we will have a second round.
    Mr. Azar, let me begin.
    Senator Cassidy asked, Senator Whitehouse would have, and 
others of us would too about Electronic Healthcare Records.
    We can do some things about that in the Congress, but I 
think most of what needs to be done, you will have to do 
because it is a matter of administration. I had urged the 
previous Administration to delay Meaningful Use Stage 3 because 
it was implementing it at a time when it was also changing the 
way doctors and providers are paid.
    I thought it would be wise to slow that down and get it 
right, and build confidence among the physicians and other 
providers about what we were trying to do. I said that based 
upon visits with hospitals like Vanderbilt University where 
they said Meaningful Use 1 was helpful, No. 2 was Okay, and No. 
3 was terrifying.
    We ended up with six different hearings and a lot of 
bipartisan interest in this.
    One thing that seemed to me to make some difference would 
be pretty simple. There was an AMA study that showed that 
doctors believe they are spending 50 or 60 percent of their 
time on documentation.
    It seemed to me that a good thing, a good approach for this 
would be--if that is true or not, at least that is the 
perception--might be for the Secretary to work with the doctors 
in Medicare. There are a half a million of them to say, ``Okay. 
If you think you are spending that much time on documentation, 
either you are not doing your job right or we are not doing our 
job right. Why do we not work together and set a goal to bring 
that from 50 or 60 percent,'' whichever it is, ``Down to some 
other goal in the next three or 4 years,'' and change the 
reality and the perception over time.
    It would seem to me that some managerial technique like 
that is essential because the inoperability is one problem, 
excessive documentation is another. It is a big mess still.
    I mean, if you are even at a sophisticated hospital, and 
you want to take your own medical records to some other place, 
the best thing you can do is Xerox them yourself, put them in 
your briefcase, carry them over, and hand them to the next 
doctor. Even in a sophisticated place, after we have spent $30 
or $35 billion.
    Can you make it a priority, and can you use some of this 
skillful managerial and executive experience background you had 
to help us improve, (A) interoperability, and (B) reduce 
excessive physician documentation both in reality and in 
perception?
    What are your thoughts on that?
    Mr. Azar. I think in both of those areas that is a very 
sensible approach, Mr. Chairman.
    Interoperability, again, it is ridiculous if we have a 
system now where you have to collect your paper records to go 
to a different facility. That is a betrayal of the vision 
Secretary Leavitt laid out originally when we started down that 
journey and we were working toward.
    He would talk about the railway system and if you do not 
get a single gauge, it does not work and how in Australia, they 
never decided on a gauge. You have three different railway 
gauges to get around Australia now. My brother-in-law can tell 
you about that. That is where he is from.
    We need to work on that and get that fixed.
    On the regulatory burden, or just the burden on Electronic 
Health Records with physicians, that would be my style of how 
to work is to the affected individuals. They know what is 
wrong. They know what is happening. Get the input from them to 
see if there are appropriate changes that can be made.
    The Chairman. You might get your father to help you with 
that.
    Mr. Azar. He probably has some ideas.
    The Chairman. Secretary Burwell actually changed something 
in her administration where she believed the reality was 
different than the perception.
    It was the patient satisfaction survey that many of us were 
convinced was causing doctors and hospitals to prescribe more 
opioids in order to get a higher score on patient satisfaction. 
She was convinced that was not true, but it was true that 
people believed that. She persuaded President Obama to change 
the policy.
    I do not know exactly the amount of time that physicians 
are spending on documentation, but they are really fed up with 
it. That, for a whole variety of reasons, which you understand 
well, we need to change that.
    I would think some simple initiative working with 
physicians especially and hospitals to say, if it is 60 
percent, and the perception is 60 percent, let us agree on a 
goal. Let us take it a step at a time. Let us take it to 50 
percent. Or if it is 50, let us take it to 40. Or if it is 40, 
let us take it to 30 and let us all see what is being done 
about that.
    We cannot do that well here. We can monitor it. We can 
encourage you. We can make some changes in the law, but 
basically it is an administrative challenge. It is one I hope 
you will take up, and then we will let the Senators here who 
are interested in that work with you in a way that would 
encourage that.
    Senator Murray, do you have additional questions?
    Senator Murray. I do.
    Thank you, again. I am very concerned about some of the 
responses, particularly to Senator Casey and Senator Murphy, 
who talked to you about what many perceive as this President 
directly, and his direction to the administration of HHS, has 
been to make sure that ACA does not work.
    The reason that we very adamantly support that is because 
many people are now getting access to care through insurance 
that did not get it before. Those are the harder to reach 
people, lower income, tougher populations. They end up, we all 
pay for them at the end of the day if they are not covered by 
insurance.
    The goal is to have as many people as possible insured, 
have access, get their preventive care, and do not show up in 
emergency rooms costing everybody else, taxpayers and other 
folks, who own insurance.
    Part of making sure, a critical part of making sure that 
they get access is through the outreach and through the longer 
enrollment.
    Now, you answered a question about the open enrollment to 
make it in half had to do with the actuarials. The exact 
opposite is true. Insurance companies put their prices out. 
They have already figured that out. The open enrollment does 
not change their prices or their actuarial costs.
    What it does is make sure that we have time for those 
harder to reach people to get enrolled and that they know what 
they are doing. They often have not bought insurance before or 
have different kinds of access problems. It takes time to reach 
them and to make sure they understand what they are buying.
    That is the intent of the longer enrollment, which this 
Administration has cut in half and made it more difficult.
    The second thing is the outreach and I was surprised to 
hear you answer Senator Casey by saying that insurance 
companies should pay for that outreach.
    They have a very different goal here. They are not looking 
for the tougher, sicker, harder to reach, more rural folks to 
sign up. They have a very different goal. As a country, as 
other people who pay for insurance see our premiums go up, we 
have that goal and that is why it is so imperative.
    In fact, in the Murray-Alexander Bill, which you have been 
asked about, we reinstate that outreach money for that exact 
purpose.
    You will be HHS Secretary if you are confirmed. You will be 
responsible for making sure that outreach money is used, used 
effectively, and the enrollment period works so that we reach 
that.
    Do I hear you that is not what you are going to do?
    Mr. Azar. Senator, I share your commitment. Any program HHS 
has, I want it to run as efficiently and effectively as 
possible and serve the beneficiaries of the program. That is my 
style. That is my commitment to you and how I would work.
    Any particulars here. I am not there. I have not studied 
the particulars of why changes were made around the enrollment 
period. I simply offered an hypothesis around what might have 
been a reason around the cutting in half of that to the 45 days 
to a more normal enrollment period. Pricing before, and then 
implementation afterwards.
    I did see that with Part D that when you bump up against 
January 1 just the insurance companies have to time getting 
people, the churn at the end of the year, getting them cards, 
getting them up and running.
    Senator Murray. I have not seen that problem at all.
    Mr. Azar. Again, I do not know. Just Senator, I do want to 
be really clear. My style. I want the programs to work for 
people and I want to work with you if there are ideas to make 
them work, the programs to work. I want to make that happen.
    Senator Murray. Do you share the goal of making sure as 
many people as possible, who may be sicker, who may be harder 
to reach, more rural, or communities that have not been reached 
before should be part of what we are working on?
    Mr. Azar. Of course, I do. I want to make sure that as many 
people have affordable insurance as possible. Absolutely.
    Senator Murray. Who do you think is best equipped to do 
that, to reach them?
    Mr. Azar. Oh, so if the question that you would ask there 
around advertising. Advertising budgets, that money, my 
understanding is at the level of Part D and Medicare Advantage. 
That is my understanding. It is television. I do not think that 
is your rural outreach or your hard to reach.
    That was just your television is my understanding on it, 
but I may be wrong. That was my understanding there. Not about 
trying to reach potential beneficiaries, get people enrolled 
into the program. That and it may just be talking past each 
other on that issue or my misunderstanding the nature of that 
part of the program.
    Senator Murray. Okay. Well, I am confused by your answer, I 
will just say that.
    I want to ask one more quick question. I know my colleagues 
do as well and that is, will you advocate for women to be able 
to make their own healthcare decisions by supporting a broad 
safety net and ensuring all women are able to see a willing, 
able, and qualified provider of their choice?
    Mr. Azar. Senator, the Administration has, I believe, you 
are asking a question about a particular provider that would be 
at issue. The Administration has a perspective about whether 
that should be funded or not. That is a legislative choice.
    If I am Secretary, I will implement what Congress has 
passed, and whatever Congress has passed and the laws that we 
have there faithfully.
    Senator Murray. I am out of time, but that does concern me 
and I will turn it over to my colleagues.
    The Chairman. Thank you, Senator Murray.
    Senator Franken.
    Senator Franken. Thank you.
    Mr. Azar, on Monday, the ``L.A. Times'' published an 
analysis of the Senate Republican Tax Plan, which repeals the 
individual mandate, or the Federal requirement that Americans 
have health insurance coverage.
    The analysis shows that repealing this provision, quote, 
``Threatens to derail insurance markets in conservative, rural 
slots of the country and could lead consumers in these regions, 
including most or all of Alaska, Iowa, Missouri, Nebraska, 
Nevada, and Wyoming, as well as parts of many other states with 
either no options for coverage or health plans that are 
prohibitively expensive.''
    Mr. Azar, in your opening statement, you said that you want 
to make healthcare more affordable and available to 
individuals.
    Given this new data, do you support repealing the 
individual mandate as part of the Republican Tax Plan knowing 
that it puts rural Americans' coverage in jeopardy?
    Mr. Azar. Senator Franken, what I do not support is forcing 
6.7 million Americans to pay $3 billion of penalties to not buy 
something they do not want to buy through a mandate upon them 
and 90 percent of whom make $75,000 a year or less. That I do 
not support.
    Senator Franken. Well, I think you understand the structure 
of the ACA, which is that you guarantee that you are not 
discriminated against for having preexisting conditions.
    Mr. Azar. Yes.
    Senator Franken. Then if you are not discriminated against, 
because you have preexisting conditions, then the motive for 
someone to get care, to get insurance, buy insurance, we have 
to mandate it. This is my understanding of the logic behind 
this.
    To mandate it, you have people do not wait until they get 
sick to get insurance, and that is just the way. Then you give 
subsidies to people who do not have the means to buy it. That 
is sort of the three-legged stool of this.
    If the individual mandate is repealed, the Congressional 
Budget Office estimates that 13 million more people will be 
uninsured and that premiums will go up by 10 percent.
    The Alexander-Murray deal--which I worked on those 
negotiations, and thank the Chairman and the Ranking Member for 
that--it is helpful, but it is a temporary measure that cannot 
offset these estimated price increases or coverage losses.
    Given this and given that people living in rural areas tend 
to be older and have greater healthcare needs then average 
populations, what specifically will you do to make sure that 
people living in rural areas are not hurt by all these current 
efforts by the Trump administration to undermine the Affordable 
Care Act?
    Mr. Azar. As you articulate it, I think you articulate it 
well. The theory of the mandate was a mechanism to pool 
insurance risk to create an insurable risk pool for the 
insurance companies to be able to do their actuarial business. 
That was the theory.
    The challenge was human behavior decided otherwise. Twenty-
eight million people are not in that pool and it eroded the 
risk pool there.
    What I would love to work with you and Congress on is 
coming up with systems that create effective risk pools so that 
we can insure them. That your rural citizens can actually have 
affordable care that gives them access, gives them choice, real 
choice. Half of our counties have one plan available to them.
    Senator Franken. Right.
    Mr. Azar. I worry about that.
    Senator Franken. The fact of the matter is that under the 
ACA, over 20 million people who were not insured have 
insurance. It feels to me that everything that this 
Administration has been doing is basically aimed at undermining 
the markets, and undermining the ACA, and undermining it so 
that we can throw away these gains.
    But everything that is getting rid of the individual 
mandate, putting out plans, temporary plans, short term plans 
that will not cover that basic, the ten basic health 
guarantees. It just seems that this is a conscious effort to 
undermine the health of Americans.
    I think that as we go forward, we have to find ways to make 
sure that people are not discriminated against because they 
have preexisting conditions, and that we have the largest pools 
possible, and we spread the risk, and we make sure that people 
have, as many people have healthcare. If you repeal this, 13 
million more people will be uninsured and premiums will rise.
    Mr. Azar. Senator, I think we share so many of the same 
goals, and just disagree about the approaches and tactics to 
get there. But my heart and my goals share so much of what you 
are talking about in terms of affordable care for people.
    The Chairman. Thank you.
    Senator Franken. Thank you.
    The Chairman. Thank you, Senator Franken.
    We will continue with our second round of questions. We 
will conclude the hearing after the second round. I think there 
may be at least one other Senator who wants to come back.
    We will go next to Senator Warren.
    Senator Warren. Thank you, Mr. Chairman.
    I share the concerns that have been raised by a number of 
colleagues, that this Administration has spent the first 11 
months of this year trying every trick in the book to destroy 
the health insurance system in this country.
    Mr. Azar, you are being considered now for the top job to 
oversee key parts of the Affordable Care Act and Medicaid. I 
want to start by asking about a basic principle.
    Mr. Azar, would you agree that it is important that we have 
a system that allows for every single American to have access 
to the kind of coverage they need?
    Mr. Azar. I think we all share the goal that we want all 
Americans to have access to affordable insurance that they 
desire.
    Senator Warren. So is that a yes?
    Mr. Azar. As I framed it, yes.
    Senator Warren. Okay, good. Here is the problem. Those are 
the exact words that Dr. Price used during his confirmation 
hearing before this Committee. He sat exactly where you are 
sitting right now and said exactly that.
    He pretended that he cared about people being able to get 
their healthcare coverage, and then he got confirmed, and spent 
8 months doing everything he could to take away people's 
healthcare coverage, and crash the healthcare system.
    I think that is the reason we are trying to be very 
specific about what it is you will and will not do.
    I want to follow-up on Senator Murphy and Senator Murray's 
question. They asked about shortening the time period for the 
enrollment and you said you wanted to be very data-driven about 
that, and you thought maybe there was a data reason for doing 
that. That is, that it was ineffective and that somehow that 
had not worked.
    Let me ask the question this way.
    Mr. Azar, if you are confirmed as HHS Secretary and there 
are no data showing that cutting the enrollment period improves 
enrollment, will you commit to going back to a 3-month long 
period for health insurance enrollment?
    Mr. Azar. My view would be that if the enrollment period 
does not make sense and work for the efficacy of the program, 
for the insurers that have to work in it, and for the 
beneficiaries, I would certainly be open to changing that back, 
if confirmed as Secretary.
    I cannot commit. I am not in the Government. I cannot 
commit to Government action not having seen everything there.
    Senator Warren. But that is the question I am asking. You 
have used data as an excuse. You said, ``I care about the 
facts. I want to be data-driven.'' You had a good exchange with 
Senator Alexander about the importance of data. I agree with 
that.
    I am just asking. If there is no data to support your 
hypothesis that cutting the time period somehow might improve 
enrollments, will you commit to going back to the 3-month 
enrollment period?
    Mr. Azar. I would need to look at the data and if the data 
drives in that direction, then I am going to push to ensure 
that the program is effective, and if a long period is needed 
and effective. I do not know what counterbalancing factors 
there might be. I am not on the inside.
    Senator Warren. It is not all about data for you, then.
    Mr. Azar. There is data, but I do not know what the other 
elements, I have not seen the decision.
    Senator Warren. I will take that as a no.
    Mr. Azar. Okay.
    Senator Warren. Let me ask another question. When Secretary 
Price was in office, he supported Republican bills to repeal 
major portions of the Affordable Care Act.
    If confirmed as Secretary, will you oppose such bills?
    Mr. Azar. Senator, I and this Administration support 
legislation that, various forms of legislation, that would have 
a system that leads to more affordable insurance, more choice, 
and more access. There has not been any support----
    Senator Warren. I asked a very----
    Mr. Azar----of getting rid of; it is a repeal and replace.
    Senator Warren. I asked a very specific question----
    Mr. Azar. Yes.
    Senator Warren----because I am trying to get this. This is 
what Price said when he was in here, so I am trying to get a 
very specific question.
    Would you publicly oppose Republican bills to repeal the 
ACA like the ones we have seen so far this year? Are you saying 
we should just wait and see what you will do?
    Mr. Azar. I would work with this Congress and within the 
Administration to build a system that helps people get 
affordable insurance.
    You and I will differ fundamentally, Senator, I guarantee 
you, on what the contours of a system----
    Senator Warren. You will not make a----
    Mr. Azar----that do that will lead to.
    Senator Warren----commitment to oppose those bills that we 
have heard so far? All right. Let me ask another one.
    What about turning Medicaid into a block grant? Secretary 
Price pushed that idea while he was in office.
    Would you do the same?
    Mr. Azar. I have actually said before that I think looking 
at block granting and empowering states to be fiscal stewards 
there can be an effective approach; the contours of that, the 
amount of funding, the size, what the baseline is.
    Senator Warren. Do you support block granting?
    Mr. Azar. I support it as a concept to look at. One needs 
to look at block granting as an abstract. The question is 
instead, what is the precise program? But the notion of a state 
being empowered to run a program and having all of the 
incentives to run an efficient program----
    Senator Warren. Mr. Azar, you could own up to the fact that 
you want to cut Medicaid and gut the Affordable Care Act like 
every other Member of the Trump administration, but you want to 
smile and pretend otherwise until you get the job.
    Yet, you say exactly the same things that would let you 
pick up right where Tom Price left off in trying to gut the 
Affordable Care Act.
    Tom Price lied through his confirmation hearing, and now 
you come in here, and say the same things he said.
    No one should be fooled.
    The Chairman. Thank you, Senator Warren.
    Senator Hassan.
    Senator Hassan. Thank you, Mr. Chair.
    I wanted to pick up where we left off on the question about 
the case of Jane Doe, the young woman I asked you about. At the 
end of that question, you said that, yes, you agreed that you 
have an obligation to follow the Constitution and all of the 
laws of the United States, even if you do not personally agree 
with it.
    Is that correct?
    Mr. Azar. That is correct. Yes.
    Senator Hassan. I am glad to hear that.
    As you know, under the Supreme Court decisions in ``Roe v. 
Wade,'' women have a constitutional right to make their own 
reproductive healthcare decisions.
    Yes or no, will you commit to upholding those 
constitutional rights as well?
    Mr. Azar. I would always work to ensure implementation of 
the Constitution and laws as currently interpreted by the 
courts. Yes.
    Senator Hassan. Okay. Thank you. I am glad to hear that.
    Now, I want to return to the issue of essential benefits 
for a second. You have said that you would make the opioid 
addiction crisis a priority if you are confirmed, and I 
appreciate that, but we need a lot more than lip service to 
make a dent in this epidemic.
    One of the key tools to combat this crisis is the set of 
Ten Essential Health Benefits under the ACA requiring that 
insurance cover substance use disorders.
    In October, CMS proposed their 2019 Notice of Benefit and 
Payment parameters which, if finalized, could let states 
seriously erode the Essential Health Benefits, including the 
substance use disorder services benefit.
    If states develop their own benchmark, the rule would set a 
ceiling on the generosity of benefits that states can include 
in their plans. Before the ACA was passed, more than one-third 
of plans on the individual market did not provide coverage for 
substance use disorder services.
    I am very concerned that under the rule that has been 
proposed now, states would decide to limit this critically 
important benefit.
    Given your stated commitment to addressing the opioid 
epidemic, yes or no, will you commit to rejecting the harmful 
changes to the Essential Health Benefits in the proposed rule?
    Mr. Azar. I believe that states are most effective in 
determining. They are most effective in determining the benefit 
packages for their citizens and the circumstances you described 
earlier. Even with New Hampshire, the unique circumstances of 
each state.
    Senator Hassan. But the problem, of course then, is when 
they do that, the insurance companies come in and charge much 
more for that benefit, and that is one of the advantages of the 
Essential Health Benefits.
    I will tell you, nobody in my state plans to get an illness 
that their insurance does not cover. Nobody plans to become 
addicted to prescription drugs after surgery, let us say, and 
then says, ``Oh, too bad. I did not buy insurance coverage for 
that treatment.''
    The advantage of the Essential Health Benefits is that 
millions and millions of people, not only got coverage through 
the ACA, but they got coverage that actually addressed their 
needs.
    As Governor, and before when I was in the State Senate, it 
was often the case that insurance companies kept dropping 
coverage for things they could not make money on and eventually 
the public picks up that cost.
    I would ask you to look at that issue very, very closely 
because the Essential Health Benefits under the ACA has been 
critical to fighting the epidemic in our state.
    Last topic I wanted to touch on with you, and you have 
heard a lot about it. It is about drug pricing and some of it 
is about your past employment as President of the U.S. part of 
Eli Lilly.
    I want to read a quote of yours from the ``The New York 
Times'' article because there is a reason that people are 
skeptical about your commitment to lowering drug prices. This 
is what you are quoted as saying in ``The New York Times.''
    ``All players, wholesalers like McKesson and Cardinal, 
pharmacies like CVS and Walgreens, Pharmacy Benefits Managers 
like Express Scripts, and CVS, Caremark, and drug companies 
make more money when list prices increase. The unfortunate 
victims of these trends are patients.''
    Basically in that quote, you are admitting that high list 
prices are hurting consumers and creating profits for drug 
companies. But yet, you continue and you did this just last 
spring to push the blame. Here you have said it is everybody. 
Everybody has got a part to play.
    But last May at a conference, you pushed the blame on 
everyone but pharmaceutical companies for high list prices 
saying even though setting list prices is something that 
manufacturers directly control.
    You have also blamed insurance plan designs for high drug 
prices, but it is really the list price set by manufacturers 
that is driving the increases in what consumers are paying 
because requiring lower cost sharing for drugs will just lead 
to increased premiums; again, all at the expense of consumers.
    I want to ask now that you will be taking off your 
pharmaceutical company hat and will be responsible for 
advocating for consumers, do you think it is time that the 
Federal Government take action to limit the profit drug 
companies can make off of setting high list prices, much the 
way we limit insurers right now with loss ratio?
    Mr. Azar. In my earlier remarks, I certainly did not mean 
to be suggesting that list price was irrelevant or that pharma 
does not have a piece of this also.
    The challenge is, as we think about the burden on the 
patient when they walk into that pharmacy, if the list price is 
$500 and they have to bear that $500, or if the list price is 
$250 and they have to bear that $250 under a high deductible 
plan, both of those can be unaffordable for that patient.
    My point is, and where I want to work is, so I think both 
can be helpful.
    Senator Hassan. I am way over.
    The Chairman. We are running out of time.
    Senator Hassan. My point is without some action by us, it 
will just be passed on and the insurance premium will also 
become unaffordable. Thank you.
    Thank you, Mr. Chair.
    The Chairman. Thank you, Senator Hassan.
    Senator Baldwin.
    Senator Baldwin. Thank you.
    I, too, want to continue along the same lines that Senator 
Hassan was asking you about, and also what we were talking 
about in round one of questioning.
    You mentioned your example at $500 a month. I told you a 
story earlier about Greg from Stoddard, Wisconsin, but did not 
mention Diane, who lives in western Wisconsin, and has M.S., 
has taken a medication for over 23 years to slow the 
progression of her M.S. She became Medicare eligible, and 
therefore the way in which the family was insured and paying 
for medication.
    She and her husband had a heartbreaking discussion at the 
beginning of this year whereby she and he decided that she 
would stop taking the medication. It had reached $90,000 a 
year.
    No change as far as I know in the ingredients, the 
manufacturing process, or anything else. It just had crept up, 
crept up, crept up over all of that time.
    I want to return to this issue of transparency. We talked a 
little bit about this when we met yesterday.
    I have offered, along with my colleague Senator John 
McCain, the Fair Drug Pricing Act which would require basic 
transparency from drug corporations. Again, understanding that 
it is a complex system, but that the list price setting starts 
with the drug corporation.
    It would require disclosure to the Department of HHS on 
elements like executive pay, investment in research and 
development, investment in marketing, stock buybacks, et cetera 
as a way to inform policymakers so that we can take better and 
stronger approaches to this crisis in many respects.
    What are your views on requiring drug companies to make 
basic information public when they are intending to increase 
the list price of existing drugs?
    Mr. Azar. Even as I referred to in my opening remarks, I 
generally am in favor of increased transparency within our 
healthcare system. I think it generally is a good thing.
    We always need to look to see if there might be any 
counterproductive aspects to transparency as you and I 
discussed in your office. I think we always have to be careful 
there.
    But as a general matter, I think transparency can be good 
and useful, and I would be very happy to study that more and 
work with you as part of all the options that need to be on the 
table to think about this. To see does it help with reducing 
what a patient pays out of pocket? Does it help with reducing 
list prices? Does it help with reducing what the system ends up 
paying?
    I am very open to looking at all of these kinds of options 
with you.
    Senator Baldwin. One note that I want to make.
    Often times, the difference between pharmaceutical product 
prices in the U.S. and overseas has pointed back to the 
investment in research and development. But in recent years, 
the investment--if you can call it that in stock buybacks and 
dividend payouts--has surpassed that of R and D.
    Is that a troubling trend in your opinion?
    Mr. Azar. I do not know. I do not study the financials of 
the companies on buybacks, for instance. But I certainly 
believe that one of the bedrocks of the R and D based 
pharmaceutical industry is that kind of heavy investment.
    I think where I was employed, it was upwards of 20 to 25 
percent of revenue was invested in R and D, a large percent of 
that here in the United States.
    As we talked a bit earlier at the hearing in reference to 
some of those entities that simply buy a product and increase 
the price, I am very supportive of that type of intensive R and 
D work. Obviously, if I am in this role, I will have NIH, which 
plays such a key role in the basic foundational science there 
and is a partner in all of that work.
    I do not know the particulars of that issue. I have not 
connected those two things, but I am very supportive of an R 
and D based industry.
    Senator Baldwin. It is quite striking. In an academic 
report, I think earlier this year, in aggregate, I think over 
half a trillion dollars invested in stock buybacks and less 
than that now in R and D. It is certainly not specific to the 
pharmaceutical industry, but very pronounced in the 
pharmaceutical industry.
    The last point I would make is just to note for the record 
that I actually agree with President Trump regarding his 
emphasis on authorizing the Secretary of HHS to negotiate 
directly with pharmaceutical companies for lower drug prices in 
Medicare. Hope that is something that you will embrace, if 
confirmed.
    Mr. Azar. Thank you.
    The Chairman. Thank you, Senator Baldwin.
    Senator Whitehouse.
    Senator Whitehouse. Thank you, Chairman.
    Mr. Azar, we talked in our last conversation about 
Accountable Care Organizations and the ways that we can deliver 
better care at less expense.
    There is another, much more particular area where, I think, 
there is another bipartisan opportunity to improve care. In 
this case, it probably would lower expense, but that would not 
be the point, and that area is end of life care, advanced care.
    There is a very good group that you may be familiar with 
called the Coalition to Transform Advanced Care that has very, 
very broad corporate institution support that is focusing in 
these areas.
    Rhode Island has been very active in this space. We have 
enormous support from--we are the most Catholic state in the 
country--the Catholic diocese has been very helpful. The State 
Council of Churches has been helpful. Our major hospital groups 
and our medical society have all been extremely helpful.
    What we see is that from time to time, we bump up against 
problems within the Medicare and Medicaid billing systems 
which, in a general arbitrary world, might make some sense.
    But once a state or a community has decided that it is 
going to undertake a path to deal more humanely with people 
near the end of their lives, suddenly those prescriptions 
become obstacles. I think, do more harm than good to the 
patient, and probably to the public fisc as well.
    Here are some examples that we are trying fix.
    Medicare and Medicaid patients are not supposed to receive 
both hospice care and curative care at the same time. If you 
are seriously focusing on the care of an end of life patient, 
that is a completely stupid distinction to force into that 
situation.
    Nurse practitioners have way too small a role and their 
role could be increased.
    The whole two night-three day in-patient stay rule before 
somebody can be moved into a nursing home is nonsensical in the 
context of somebody who is operating under a good end of life 
care base or hospice plan.
    Home health services ought to be provided without having to 
meet the full regulatory definition of being homebound. Very 
often a dying patient can still move around for a while and is 
not fully homebound. But it would be cheaper for the system, 
better for the family, easier for the loved ones who are 
providing care to get home health services. That rule, again, 
backfires.
    Finally, caregivers often need respite and respite care is 
a very valuable thing because without that, you wear out the 
caregiver and now the system has to come in at a vast expense 
and pick up with potentially an in-patient treatment.
    Home-based respite care where you do not have to put your 
family member into an in-patient place, while you get your 
couple of days of respite, would seem to make a ton of sense.
    None of those things are being done and the result is that 
this very precious time of life toward the end, states want to 
make it better. They want to make sure that the wishes of the 
patient are honored and that it is clear around the family what 
those wishes are, so there are not horrible fights at the end 
of life.
    All of those things can be made so much better. Here is the 
Government with all of these rules that may make sense, again, 
in isolation. But once you start to deal with end of life care 
in any kind of a comprehensive and humane fashion, they begin 
backfiring in your face.
    Will you work with us, particularly with Rhode Island, to 
try to support models?
    We do not need to get rid of them entirely, but what we 
really want to do is to support waivers so that when a state or 
a community steps forward with a really good, humane----
    I am saying this sitting next to Senator Baldwin, whose 
state is legendary for end of life care planning, by the way. I 
should give Wisconsin some props here as well.
    Would you help us with that?
    Mr. Azar. Senator, I just want to thank you for those very 
thoughtful comments and reflections.
    As I mentioned in my opening remarks, my stepmother Wilma 
died just in July and it was a blessing that she was able to be 
in her house, in her bed for the whole time.
    Senator Whitehouse. Yes.
    Mr. Azar. I want to make sure people have that chance and 
so, happy to work with you.
    Senator Whitehouse. I think what we will find is that it 
actually helps the public fisc as well.
    But to be perfectly blunt, I do not actually care if we 
have to spend a little bit more money so that people at the 
very tender time of their life, and the family who are 
surrounding them at that very tender and important time of 
life, are not treated disrespectfully and are not pushed to 
make dumb decisions based on bureaucratic rules that simply do 
not make sense at that time.
    God bless you and thank you.
    The Chairman. Thank you, Senator Whitehouse.
    Senator Murray, do you have any closing remarks or 
questions?
    Senator Murray. Again, Mr. Azar, I thank you so much for 
you and your family patiently sitting through this.
    I do have some additional questions.
    Senator Murray. I would just ask that we do get timely and 
sufficient answers to our questions. We have had that problem 
before under Secretary Price, and both before confirmation, and 
then after your confirmation just really respectfully ask that 
we get timely answers so that we can do our job as well.
    I did want to put one issue on the table that we did not 
have time to address and that is HHS's plans for implementing 
the Preschool Development Grants Program.
    We authorized that in our Every Student Succeeds Act. It is 
something I am very concerned about and I am going to be 
watching very closely to make sure that really vital program is 
implemented the way that Congress intended, so that it helps us 
expand access to high quality, early learning and care for our 
most vulnerable children.
    I will follow-up with you, but know that I will be 
following that very closely.
    Again, thank you for being here. I know you have another 
hearing to go through, numerous questions. We will be looking 
at all of those.
    But if you are confirmed, I want to know that we will talk 
to you, work with you, and hope that you will be as responsive 
as we need you to be.
    The Chairman. Thank you, Senator Murray.
    Mr. Azar, thank you for being here, for your willingness to 
serve, for answering the questions. I do hope you will respond 
to the Senators' questions. We do not have any limit on the 
number of those questions, but I hope there will be a 
reasonable number of questions.
    About one-third of the Members of this Committee are also a 
Member of the Finance Committee, which is the Committee that 
will vote on your confirmation and report it to the floor of 
the Senate.
    I think you have seen today the diverse points of view on 
this Committee and some people wonder how we could ever get 
anything done. But the fact of the matter is we get quite a bit 
done.
    A couple of years ago, we fixed No Child Left Behind in a 
way that President Obama called, ``A Christmas miracle.''
    Last year was the 21st Century Cures legislation that the 
Majority Leader said, ``Was the most important legislation of 
the year.'' You will have a chance to implement that 
legislation, as well as the Mental Health Reorganization that 
was a part of it.
    This year we worked, Senator Murray and I, worked to try 
and see if we could find some area of agreement, even though it 
is for a short term, on the Affordable Care Act which we were 
able to do. It is not law yet, but we were at least able to 
take a step.
    There are a number of areas and you have heard many of them 
today. Senator Whitehouse suggested two major areas of 
bipartisan cooperation.
    We have talked about electronic healthcare records. There 
is a lot here that we can do working with you and I think you 
will find that most of us would like to create an environment 
in which you are able to succeed. We will not be shy about 
giving you our points of view as you are able to tell today.
    My hope also is that we can talk about more and work with 
you on more than the individual insurance issue. For the last, 
it seems like forever, we have focused on health insurance and 
only 6 percent of the Americans who buy health insurance on the 
individual market, every single one important. But year after 
year, we give ourselves----
    It is like going to college, and taking only one course, 
and earning a ``C,'' or a ``D,'' or an ``F'' on it every 
semester. We do not seem to be making very much progress and 
the important thing about it is there is so much other 
important things that we should be working on when we talk 
about health, and healthcare, and the agencies that you work 
on.
    Drug pricing is one this Committee has a great interest in. 
I, for one, am excited about the fact that you know something 
about this. Health insurance is complex. I think drug pricing 
is Byzantine. I think if we had a Secretary who was new to the 
subject, that he or she would leave after two, or four, or 8 
years without having accomplished much of anything because it 
would take that long to understand what is going on.
    You arrive knowing the subject and helping us answer the 
questions, where does the money go? Do we really need rebates? 
Can there be more negotiations on drug pricing? Should we 
really think seriously about finding a way to let Americans buy 
drugs in the United States that are not approved by the Food 
and Drug Administration? We have not ever done that before, and 
several Senators think we should, and we will need to talk 
about that.
    We should be talking about wellness. We have had two or 
three hearings on that. That offers great promise for reducing 
healthcare costs. Electronic healthcare records, we have talked 
about.
    Biomedical research, we hear a lot about the President's 
budget proposals. We hear less about the fact that Senator 
Murray and Senator Blunt for 2 years, hopefully for three, have 
increased funding for the National Institutes of Health, $2 
billion a year, and we added another $4.8 [billion] in the 21st 
Century Cures.
    We are putting big, new dollars into the National 
Institutes of Health, as well as big, new authority into NIH 
and the FDA, all of which you will have a chance to take 
advantage of and to make something of.
    I think it is a very exciting time for someone with your 
experience, and background, and energy to come to this 
position. I think you could help families all over America and 
I hope, if you are confirmed, which I am confident you will be, 
that you will look to this Committee, both the Democrats as 
well as the Republicans, as a resource to create an opportunity 
in which you can succeed.
    I ask consent to introduce four letters of support for Alex 
Azar into the record, which it will be done.
    The Chairman. If Senators wish to ask additional questions 
of our nominee, questions for the record are due by 5 p.m., 
this Friday, December 1.
    For all other matters, the hearing record will remain open 
for 10 days. Members may submit additional information for the 
record within that time.
    The Chairman. The next meeting of the HELP Committee will 
be a hearing tomorrow, November 30, at 10 a.m. We will hear 
from experts on the opioid crisis.
    Thank you for being here.
    The Committee will stand adjourned.

    [Whereupon, at 12:34 p.m., the hearing was adjourned]

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