then you will come north the purpose of today's hearing is to receive before the full committee testimony from the distinguished secretary of health and human services regarding the president's fiscal year two thousand and eight budget request and the secretary we welcome you on occasions when i hear of his conduct is the full committee level the chair after consultation with my dear friend mr barton will be following somewhat different procedures with regard to opening statements and questions consistent with the rules and past practices of the committee the chairman of the ranking member of the full committee then will be recognized for five minutes opening statement the chairman and the ranking member of the roads and subcommittees will be recognized for a three minute opening statements all other members will be recognized for a one minute opening statement but they may waive their statements for additional one minute of questioning during the first round sure wishes that we could do this a little differently but the situation is that we have a very large committee and do business and chokers you know all this is probably the best solution we used during the past congress where mr barton and i work it out and it was generally satisfactory to the members now i will recognize members who are here when i call this meeting by order of the seniority on the full committee once all these members have had not been to deliver away the statement i will recognize all members of the committee in order that they arrive at the hearing sharon davis the chief clerk of the committee will keep a careful accounting of attendance for purposes of assuring that this is true in really carried out the chair will recognize members for the purposes of questioning secretary leavitt under the same procedures that i've outlined before we proceed with the hearing the testimony of the secretary of the energy regarding the president's fiscal year two thousand and eight budget request and members and their staff are invited to a briefing by the interbrand intergovernmental panel on climate change regarding its recently announced fourth assessment report on february ninth at ten am sure suggests very strongly that my colleagues should be their share now recognizes and self for the purposes of an opening statement the president's fiscal year budget from the secretary of health and human services of our friend secretary leavitt forty six million americans today lack health insurance this problem warrants immediate attention the administrat however continues to shred the health safety insurance net first the president has missed and regrettably and i historic opportunity to reduce the number of uninsured children seven out of ten uninsured children qualif medicaid or the state children's health insurance program but are not yet enrolled the president however makes cuts in the program ensuring that we will not reach those children and that more children their parents will become uninsured second rather than working with the states to bolster health care coverage ministration cuts key benefits fifty billion dollars in overall cuts to medicaid coming on top of last year's twenty eight billion in cuts it also induces a stage to provide bare bones packages and high deductible plans that make little sense for the working poor third the president proposes billions in tax breaks to encourage people to move from employed sponsored coverage into high deductible or bare bones health plans in the unregulated insurance market studies have documented that this will cause employers to drop insurance coverage that sacred vied their workers day fourth the president directly  the institutions that serve the uninsured and the uninsured and the under insured cutting upward of fifty point four billion from hospitals public providers and medical education and medicare the budget is noteworthy for what is absent is what is included the budget fails to address the documented problems in part d drug benefit order include one dime to address spending that a care physician payment cuts a very serious problem according to the american medical association pose any of the med pac recommended cuts to h m o and private health plan payments which alone would save tens of billions of dollars over that time instead it proposes two hundred fifty two billion dollars over the next ten years in cuts to medicare fee for service the program that arose vast majority of our seniors today in the public health service budget there are several other proposals causing concern instead of assisting programs being invested in that would affect children's health and and adolescent health the president's budget creates a new adolescence health promotion initiative with a budget of seventeen million for a country of three hundred million people the public health safety net takes another beating in this budget programs for training health professionals substance abuse prevention and chronic diseases are but a few examples the budget for national institutes of health those not keep up for inflation much less provided providing for needed increases where they could be spent for the public good i've alarms the budget does not provide adequate resources for public health threats viral terrorism the trust for americans health says that reduction in the bioterrorism and public health preparedness programs is particularly troubling we are cutting corps boots on the ground support for emerg disaster response leaving the country at unnecessary levels of risk while this budget provides increases for food and drug administration i remain concerned that these increases will not be adequate to allow food and drugs to properly ensure the safety of drugs foods cosmetics and medical devices this is a disturbing message that we find in the president's budget from the chair notes and i've completed my statement with thirty two seconds remaining and i recognize my dear friend mr barton thank you mr chairman and if you still a little rusty i can just to show you what a good fellow i am i'll be happy to take over at any time you know until you feel secretary a governor levitt here we welcome you sir this committee has a proud history of legislating and doing oversight in health care in the last congress we reauthorized for the first time in a generation f things that actually became wall and that originate in this committee in the last congress one hundred tenth congress we have a new chairman who's going to do an outstanding job i'm sure and i'm sure that he wants to be active on health  care i do i will not be surprised if the emphasis changes we've already seen a lot of the presidential want to be candidates on the democratic side talking about health care and if they follow through we're going to see lots of proposals that would require tax increases government mandates and many many more government bureaucrats involved in health care for the average american the average american family and i personally think we ought to have more choices in health care and i think those choices are to be based on market forces and openness and transparency as opposed to mandates and  we will have some spirited hearings and some spiritual debates about that in this committee mr dingell has told me that he plans to reauthorize the the state children's health insurance program which we commonly call a program that program expires issue here it's on the jurisdiction of this committee and we certainly want to be involved in that the new congressional majority has already passed a piece of dingell taught me when i was a junior member of this committee in the minority that you held hearings and you held markups and you actually had a regular order process to do major things like that we've not done that so far some some on the majority decided to legislate before they knew what they were talking about that maybe we're coming back to the old way of doing things this is the start of today's hearing i certainly i certainly hope so i do think that we need to look at the medicare program and we need to look at the medicare part d prescription drug benefit program the numbers that i've been given show that premiums are forty two percent lower than expected to cost a thirty percent lower than anticipated and that the seniors that have chosen to participate in the program have somewhere between a seventy and eighty percent satisfaction so that seems to me that it's a program that's working cost are coming down  options are going up and people are satisfied we also need to look at the larger medicare program we need some long term reforms in medicare and i'm sure this committee is going to look at that  we have a funding problem in medicare over time programs going bankrupt and i'm hopeful that chairman dingell will take a systematic view that the overall program the president his state of the union address thence to new and innovative solutions for affordable health insurance i'm sure that sector is going to talk about that in his statement we do have millions of uninsured americans we do need to find a way to fund health care and health insurance for those americans who don't have it today the president announced two programs to do that he has a tax deduction for basic insurance called the president's affordable choices initiatives this would provide states with incentives to make basic affordable private health insurance available to their citizens as the secretary of h h s would be able to redirect federal payments away from institutions to individuals and eligible states and i think this is an idea that makes some mr chairman what a difference two weeks makes at the white house yesterday president bush sent his budget proposal to congress that completely contradicts statements he made on health care two weeks ago during the state of the union address he specifically stated then that when it comes to health care government has an obligation to care for the elderly the disabled and poor children yesterday the president proposed a budget that includes serious cuts to the very programs that serve these vulnerable populations that is medicare medicaid and the state children's health insurance program s chip so once again it appears as though the president's previous statements are nothing but empty rhetoric and i'm most alarmed about the president's proposal to reauthorize the s chip program under the president's plan the federal government would reduce payments to states who cover children above two hundred percent of the federal poverty line this would mean a drastic reduction in aid from my home state of new jersey which covers kids up to three hundred fifty percent of the federal poverty line if in fact that i have no doubt that would spell disaster for low income children in new jersey and across the country as congress works to reauthorize s chip i urge the president to scrap his plan and work with democrats to put forward a realistic proposal that maintains current eligibility standards and improves outreach and in roman efforts i also have serious concerns about the mix of medicare and medicaid proposals included in the president's budget once again the president has put medicare and medicaid on the chopping block instead of trimming the fat currently going to managed care companies the president would slash reimbursements to providers and burden beneficiaries with higher premiums noticeably absent from the president's budget once again is any mention of the physician payment fix apparently ensuring physicians receive adequate payment is not a priority for this administration and finally mr chairman let me reiterate reiterate my firm opposition to the president's new health insurance tax proposal and i stress tax proposal because that's what it is this will be disastrous for consumers because it forces them into the unstable and uncertain individual insurance market as with health savings accounts and associated health plans the president's new proposal could potentially increase the number of americans without insurance especially among our most vulnerable citizens who need it most and i'm also firmly opposed to his plan to divert dish payments away from our safety net hospitals i wholeheartedly agree with the president that we need to do more to reduce the ranks of the uninsured however i disagree with the means he is proposing to get us there as congress considers possible solutions to this growing problem we should be guided by the principle of first do no harm unfortunately the president's latest budget proposal fails to meet this basic test and i have a lot of concerns in addition to the president's budget proposal too many to mention now but i look forward to asking the secretary some questions later today and thank him for being with us thank you mr chairman joe thanks ge sure recognizes next truth of how sizable bureaucracy has been functioning the subcommittee will not be requesting documents or interviews that we don't need but we will expect your cooperation ensuring that the committee has the information necessary to fulfill our constitutional responsibility to see that the law is sufficient in his view and ministered properly we have particular concerns about the compromises to both food and drug safety at f d a we're concerned about the department's ability to protect this country from bioterrorism and natural threats such as pan we intend to examine issues of ethics and conflicts of interest that seem to plague your agencies we want to work with you to examine problems and to call attention to your successes on a personal note a good start would be if you could answer the questions i put your predecessor back in july of two thousand and four regarding the one eight hundred adverse side effect numbers for prescription drugs it's been almost five years and nothing's been done also by february fifteenth two thousand and six questions to you concerning accutane specifically with over three hundred  suicides reported by accutane users what is the f d a doing to protect users other than posting warnings on the f d a website thank you for coming and i look forward to asking a few more specific questions later  wald for one minute thing mr chairman mr secretary welcome we're delighted to have you day here to day i realize the budget of any size for a family or for a family of three hundred million you have to make some tough choices and i want to commend the president for the additional two  hundred twenty four million for community health centers i think this is something that i hope congress will certainly act i've seen firsthand the importance of these community health centers across my district i'm also pleased to the present recommended a modest increase in funding for state offices rural health ours in oregon does a fantastic job i'm disappointed however the president recommended eliminating funding for other rural health programs such as rural hospital flexibility grants which fund quality improvement efforts at critical access hospitals and small rural hospitals represent a district that's more than seventy thousand square miles in size with many many very small isolated rural communities this programs essential for them also with the rest of my comments for the record and i'll look forward to hearing your comments priorities it's been said that our budget is a statement of the nation's priorities and i from one are disappointed that it continues to be a bigger priority for our president to cut taxes for those who have money and to cut aid for those who have little this president's iraq policy cost us over one hundred billion dollars a year and the burden for paying for that is placed squarely on the backs of seniors children in the working poor and not those who have plenty to give medicare cuts medicaid cuts hardly enough funding for s chip to cover the children already in the program today at a time when the president is pushing to take people from uninsured to under insured he proposes cutting support funds for the hospitals that service the last refuge for those folks and as a public health the safety net and finally while the president claims his budget is fiscally responsible it will hamstring our economy over the long run adding another three trillion to the national debt over the next five years alone mr secretary i look forward mr secretary for being here but i'm pleased that there is a number of things that continue to be funded in the president's budget i'd like to ask that part of the thing that make come out maybe not necessarily this hearing in the future too is we look at some examples of where we can be saving money and not just looking at the way that congress is you deal with in the room because these include such things as saving fifty billion dollars and ninety thousand lives whether providing incentive payments or working with hostels to reduce infections to expand the number of volunteer doctors or community health centers and making sure that every family has a neighborhood doctor to limber nate higher discriminately co payments under medicare for nation's seniors seeking mental health services and also work to establish regional collaborate and so work on health information technology all these issues that i know are near and dear to you and  president and i look forward to hearing your comments saying working together with you to make sure bring health care into the twenty first century and also to make sure we really work to reduce health care costs and not just deal with the cost of health insurance thank everyone's mind and that is pandemic flu preparedness this budget includes another one point two billion on top of the six point one billion that we've already appropriated but just in recent weeks we have seen a mutated avian flu virus kill two people in egypt and the scary part was that this virus was resistant to tamiflu which at the moment is our primary post facto countermeasure this is a dynamic evolving threat we need a dynamic evolving response i don't think anyone on this committee and i'm sure secretary leavitt is encouraged by how we responded to katrina and this is katrina times one hundred so i would urge you mr secretary to make clear and in this testimony and in your future statements how your department will be ready how your strategy will guarantee that this enormous potential threat will be handled i think it's up there mr chairman among employees of the budget makes continued commitment to expanding health centers fully funding this initiative represents just one side of the coin however there are many entities are willing and able to establish a community health clinic in many more areas of the country none more so than mock the portion of north texas that i represent however many archaic program rules hinder the development of a medical home for millions of more medical americans i believe that while additional funding is essential the committee must turn a critical eye toward the rules that govern the community health feels that that is of in issue that requires a legislative fix and not a federal agency fix another issue i would like to discuss is the state of the health care system in and around new orleans having visited that area several times after hurricane katrina and discussing the situation on the ground with health professionals i have grave concerns that the money appropriated for rebuilding and relief in that area could be used in a more efficient manner i'm also concerned the federal agencies that could assist hospitals and other health care providers are actually more of a hindrance than a help but for coming here as you know health care access is one of our big priorities here in the congress forty six million americans are uninsured and that includes one in three residents in my district who don't have a form of coverage and fourteen million latinos nationally who don't have any health care coverage eighty three percent of the uninsured as you know are working families and yet the proposed budget appears to leave our seniors and children with fewer choices and higher costs nine million children including one in five latino children are uninsured and yet the president wants to reduce s chip eligibility for many of our children our safety net providers and hospitals are also struggling and they make that very well known to us when we go home to our districts communities of color bear the impact of the lack of health care struggling disproportionately from chronic diseases such as diabetes and obesity and yet the budget fails to place a priority on culturally and linguistically competent care we must do better for all americans and i urge you to ministration and secretary leavitt to work with us in place a priority on ensuring access to quality affordable culturally and linguistically competent care in all of our communities and i thank you mr secretary look forward to working with the secretary being here i praise any implementation and oversight of medicare part d in my congressional district i've heard nothing but overwhelmingly good news and i had the villages which is the largest adult community in the nation and i've heard nothing but positive news in fact recently and again till sun they printed a letter by one of my constituents and this is very now james she and her husband are both in their seventies they've been married for almost sixty years and they wrote quote medicare part d it has been a great experience for our family we save nearly two hundred and fifty dollars a month because of medicare part d on our medications and we're look forward to continuing this savings next year this benefit has given them coverage and it appears from their letter piece of mind which is most important and also rationing i think all of us all the washington post editorial that appeared on november second two thousand six talking about this prescription drug how it's working and we don't need to change it and so mr chairman i'm just very pleased that the secretary is here and i want to comment compliment him and his staff for what a great job they're doing with budget as a dead on arrival document that gets everyone in a tizzy so perhaps we should keep that in mind but i think this budget is important to discuss even though it will not pass in illustrating how a priority is helping in this prior to his asian is hurting americans health when americans go to get health care and it's not there if this were budget to pass because of the cuts to the disproportionate share program for hospitals that help serve  forty seven million americans who do not have insurance and they wonder where their health car care when it went into the sands of iraq in this policy document this budget makes very clear that the president has made a priority on the escalation  taxpayer dollars into the sands of iraq rather than to our nation's uninsured and our seniors both of whom will have reduced access to health care and the principal message i would take from this budget is we'd rather escalate in iraq than escalate our efforts to provide health care in america and we'll be talking about that this afternoon thank you the gentleman cherokee guys is now our good friend from michigan  wright from one gentleman who's way sure then will recognize our friend and colleague mr hill for one minute mr secretary thank you for appearing before us today i first want to say that i'm happy to see that the president has made health care an issue has become a priority for him i believe it's very important to ensure access to affordable health care for all of our citizens and ailing workforce is terrible not only because people are suffering but the car that cost the government millions of dollars for illnesses that could have been prevented however i don't believe that penalize in those who already have employer sponsored health insurance by raising their taxes is the way to do so that aside it seems that the president and some of my colleagues on the hill are attempting to develop some system of universal health care while some may see ensuring affordable health care for all citizens as the government's responsibility others made us as a responsibility of the private sector or individuals i believe that these individuals have essentially skipped over one of the most important debates that congress should have is affordable health care a right or a privilege if congress decides that a portable health care should be a constitutional right it made include all relevant players insurance companies pharmaceutical companies hospitals doctors etc in devising a program mr secretary i look forward to your testimony today and specifically to nearly forty seven million americans are uninsured and an additional sixteen million either are under insured so in aggregate sixty three million americans either have no health insurance or only sporadic coverage or have insurance coverage leads leaves them exposed to high health care costs and we all know this is unacceptable but what's even more unacceptable is that the president's budget proposes harsh cut to both medicare and medicaid programs that actually do provide affordable comprehensive health care and it offers a reform proposal that i fear will make many americans worse off in addition this budget includes substantial cuts to health care providers those who are actually providing the needed care to the forty seven million uninsured americans lastly this budget proposes to fund the state child health insurance program at a level which we all know will fall far short of the amount needed to continue to provide health care to the children currently covered this at a time when we ought to broaden s chip to cover all uninsured children in america i'll defer the gentleman has deferred share recognize is not a distinguished gentleman from north carolina mr butterfield thank you very much mr chairman the secretary let me join my colleagues and thank you very much for your testimony today and your willingness to come down and engage in this process the reason i'm sitting on the third tier is because i'm one of the newer members of this committee in fact this is my very first hearing so thank you very much for being a part of it i represent the fifteenth poorest district in the nation eastern north carolina and we have a health care crisis in my congressional district and i know you're sensitive to that but i want you to encourage your department and the administration to to become more attuned to rule health thank you mr chairman and welcome mr secretary i appreciate your presence here today i want to reiterate a point that was made by several of my colleagues and that is my concern about the cuts to medicaid and medicare this will affect in maryland my state six hundred twenty seven thousand medicare patients and four hundred eighty five thousand medicaid patients in the way we are affecting them is that we are reducing reimbursements to physicians and that is something that this congress all a few months ago said heard about from many of my colleagues so i think this is a very unwise policy and then to increase premiums on this population of patients and customers i think is equally unwise because we are in the health care crisis as has been mentioned i share the concern of my colleagues regarding s chip s chip program we have one hundred thirty seven thousand uninsured youth in my state alone many people now in fact there's a broad consensus that what we ought to do is start by universally covering our young people those under eighteen this policy moves in opposite direction third i want to mention law it's ironic on one of the coldest days this region has experienced we're looking at a budget that under funds the law program for low income home energy assistance by three point three billion dollars we are at the rise five billion dollars for lockheed and this administration comes in woefully short of that and the problem becomes when we have programs from places like venezuela who try to help people say oh that's awful we should not accept assistance but we in this country do not provide the necessary systems for the poor when they confront these drastic weather conditions so perhaps we could do better we would not have to i'm concerned that much of what you ministration proposes is an escalating war on our public health system that supposedly duction may virtually eliminate the health safety net for millions of our poorest citizens and that is wrong these book poses will shift the weight of paying for that camera on to already overburdened city county and state did oppose cuts to medicare and medicaid for chronic disease programs the lack of physician payment reform and the administration's inability to adequately fund help information technology is hurting this nation's ability to provide effective quality care and to reduce health disparities among communities of color i'm deeply concerned that this is ministration is going in the wrong needs of children seniors hospitals and communities are sacrificed for the administration's other priorities of the proposals within the budget strike at the foundation of patient care and salting to from every possible angle the children's health insurance program will see its funding cut from last year and worse the amount allowed i would cater for its reauthorization is less than half the amount acquired to maintain coverage for current beneficiaries with well this al one will undoubtedly compound the number of uninsured the hospitals and all the safety net providers have their funding slashed as well and the f y o eight budget calls for billions of dollars in your county in medicare and medicaid cuts including two point seven billion for new york hospitals and health centers just two weeks after c m s issued a regulation that limits states ability to join down needed medicaid dollars from lawful intergovernmental transfers and one of the most ill thought out proposals the president called for diverting up to thirty billion dollars in essential payments to safety net hospitals the states to promote private health insurance like my state of new york regardless of the scope of coverage we can increase coverage effectively old movie groundhog day living so the same budget over and over again once again the president has placed a higher priority and more tax cuts and misguided war in iraq than on meeting the nation's healthcare needs despite a record number of uninsured and medical bankruptcies his budget either cuts critical health care initiatives or fails to provide adequate resources to meet the challenge before us that many of the same concerns today that i did last year propose cuts in medicare medicaid nurse and health professions training the national cancer institute preventive and mental health and provider payments that will jeopardize access to quality and timely care so disappointing to low funding levels for s chip this year like last year i believe the president's diagnosis of the problem is the of the actual problem there and are not paying too little for health care are getting too much they're paying too much and getting too little shifting more costs onto the already overburdened backs of medicare and medicaid that this year it is the wrong answer so too was the proposal have u s taxpayer subsidized highly inefficient individual health policies and set of more cost effective public however the movie groundhog day ends happily when bill murray comes to his senses changing his behavior and moves forward although the president's budget proposal so no sign of changing i'm confident under your leadership mr chairman the congresswoman a different direction to meet our health care priorities and i'd just like to add my to support what dr burgess said about katrina victims we need to do more  to focus on that some point today that's su su and su i got a state that's got the fifth highest number of folks and rolled in that very successful very effective program as a result of that were most adversely affected by a funding formula that reform it so we don't have this shortfall on your bases thank you would be put towards those that had responded on september eleventh and stood on that pile digging for their friends and loved ones and are now dying i can't find it in me to say thanks though twenty five million dollars is a fraction of the one billion dollars or so that is probably going to be necessary twenty five million dollars should not cleanse the federal government of its responsibility when it was the federal government that said it was safe for these men and women to be there with a paper mask over their face and twenty five million dollars is really not a great gift when the rest of the budget cuts new york two point seven billion dollars so i think it's it's commendable but it's to some degree your administration has said it's the responsibility of the federal government for these folks that are dying little by little day by day but i also think that it's shameful to do the victory lap about the twenty five million and then hide from the two point six billion dollar responsibility well today you're not going to be able to do that but i w joe thanks gentlemen chair noach i think we've heard from all the members who desired to make an opening statement or any member who deserves to be heard at this time for opening statement very well then mr secretary of we express to you our section and our welcome if you'd like to have somebody at the witness table there with you it would be perfectly proper  your would so you may do so or even encourage you if you so desire thank you mr chairman may i express what a privilege it is to appear before you in this committee on your first committee hearing i will accept your invitation of appropriate times if there are those who can give better answers than i'm equipped to i'd like to be able to provide the best information we have available this is a complex large budget it required hundreds of people the better part of a year to develop there were tens of thousands of individual decisions rather than attempt today to select individual items  opening remarks i do think it would be most helpful if i could just provide some context and move rapidly as possible to the individual topics that the various members have indicated most of you are aware of how this budget is arrived that the president does in conjunction with the office of management and budget lay out a context and doesn't fact provide instructions and themes and priorities it is then sent to the various cabinet members who have the responsibility then to provide instructions to those who lead the department i think it would be important for me to establish that context it's very clear to me and i hope to you in the american people that the president shares the view that every american ought to have access to an affordable basic insurance policy he shares the view that our homeland should be safe he shares the view that we should do all we can to provide assistance to those who are in obligations that we keep our economy strong it's important to him that we keep our taxes affordable that we spend taxpayer money wisely now having those priorities given to me as a cabinet secretary i called together my colleagues and gave them a set of guidelines and i'd like to review those with you if i could because i think it will give you a context to understand the nature of these decisions  i first of all indicated to them that there were there would obviously be a need to alter the go i'd path of the budget if we were going to be balanced by two thousand and twelve and that that would of course require choosing between programs all of  ahead it's clear to me and i'm sure to all of you if we are to balance a budget by two thousand and twelve it does require the selection of priorities between noble projects and i don't have any question about the fact that there will be differences of view between members and between the congress and the administration on what those priorities should be my purpose today isn't to reconcile all those disagreements but simply to make certain you understand as best i can the judgments that were made recognizing that the hard choices would need be made we also recognize that would be new programs new initiatives things that were important to us respond to and i i gave my colleagues essentially four principles to follow in selecting all just let me numerate them the first was if there are high demand highly effective programs that are serving people well we do need to make certain that they are made a priority i'll give you some examples of head start we protected head start in this process i'd also recognize the indian health service the issue that's been raised many times on s chip we believe s chip as a priority needs to be reauthorized and they're anxious to have a discussion on the basis on which that should be done and there were a number of presidential initiatives that the president wanted to assure were met and my job is to make certain that they are i'll give you an example of a community health centers the president made a commitment when he became press event to have twelve hundred new ones and in addition to that to seek out the counties that have the highest need and make them a priority this budget will address that the third principle was  if there are pressing new problems that we need to address then we need to find room in this budget to do so many of you have mentioned the f d a and the need for greater focus on drug safety you'll see in this budget a response to that because we see that as a high new priority the fourth was to continue to seek funds and to advocate for funds in some areas that we've advocated in the past that i have not been funded to the degree we believe they should be i'll give you examples health information technology very important centerpiece on how we can make health care work better fraud and abuse i've been secretary now for two years it's become evident to me that we need to do more in that area and this budget requests response and that from the congress the commission corps corps rather part of our united states public health service many many  you talk about katrina that that's a priority those are the four principles that i asked my colleagues to look for in terms of adding new but new items to the budget now with respect to the more difficult task of where we would how we would balance out the glide pattern so that we could land a balanced budget by two thousand and twelve i provided them with six principles and if you don't mind i'll just enumerate them because i think it'll give us  f the basis of some conversation you'll see some places in this budget where one time funds were not repeated many of you will be advocates as i am for the centers for disease control for example  you'll note that there are some one time funds that we did not repeat in this budget because this construction was done the second we chose to favor programs where there was a  direct providing of a service as opposed to the bolstering of infrastructure again i would like to be able to bolster infrastructure and provide basic services but when we're trying to make these judgments i offered the guidance to my department that i'd like to see them emphasize the actual providing the services i'll give you a very good example of this you'll see places here where in advanced nursing for example we did not increase the funding and sat in fact have reduced funding in a couple of places but we have increased basic nursing by the use of that loan forgiveness and so forth and we've also funded community health centers there's an example of where i said if i can't do both i'd rather provide services than infrastructure so again i recognize that those are both noble purposes but so you'll understand why that happened when they made the decision based on that guidance the third principle was to look for places where grants i had been concluded or were activities that are actually been concluded a good example of this is in the national cancer institute you'll see a minor reduction  the overall budget of the national cancer institute but i would like to point out that there would be an increase in the number of new competitive grants that are provided why because continuation of as ship as a priority and we see it being about fifteen point four billion dollars in the future and we would new money mr kerry we would add five billion dollars of new money plus the four point four billion that  as we review the budget and we consult with the actuaries at c m s is fiscal year two thousand and eight four point seven million fiscal year two thousand and nine four point seven million the school year  thousand and ten four point four million two thousand and eleven four point four million two thousand and twelve four point three million are those numbers correct mr chairman our purpose i'm not able to follow the individual puella me give you the principle on which we would like to operate of you a secretary i'd love to get that but i got i got to get down to numbers because we're talking about them and i don't mean any disrespect but if you want to read off again and i'll ask my able to count and some behind three to four times a four point eight billion in the president's budget to keep the children from losing coverage is that true we believe that the budget we provide provided or that we proposed is adequate for us to continue as chip we do believe that as chip in the future ought not to be covering more adults than it currently covers and we believe that it should be focused on children who are in the most need and we look  point eight billion in the president's budget to keep children from losing coverage is that correct or not that would not be consistent with the beliefs of the administration well i'm going to ask you to document that  numbers that we have gotten everywhere tell us that that is the case now mr secretary your budget provides no new body to help states with the cost of covering children in fact it does just the opposite it  cuts other domestic programs by one hundred seventeen billion over five years as compared to current spending level and it cuts medicaid by close to fifty billion dollars over ten years is that statement correct the budget is as you point out i would like to make clear that we believe the budget does make responsible changes in the growth rate of medicaid and i will add medicare that we can provide the underlying health care that's required for the groups that those programs were intended to serve with the budget that we've put forward now mr secretary here let's stick a family of three whose income is not more than thirty six thousand dollars and we reduced the funding to the states to take them off the chip program is that is that a first statement that you package would remove families of three which have income of not more than thirty six thousand dollars and reduced payments to the states so that they would be removed from the s chip program that would be dependent upon the state and it would be dependent on the rules adopted by the state then in the one nine hundred seconds i have remaining with you and you are sure me that that will not happen i can assure you that it is dependent completely on the state partially responsible in the city is for children what's what's your definition of a child well that the definition obviously is established by the states themselves and the states have the ability to define what they will my definition of a child would be a youngster a toddler somebody living at home with a legal guardian or his or her parents somebody normally under the age of eighteen but there are some states that that's not a child in that correct i'll accept your definition and we have now i think in the vocabulary an interesting term adult children do you think the original s chip program was established to cover adult children no mr barton it was not i was governor at the time and serving as part of the governor's association team that dealt with congress and i'm quite familiar with the historical background on this ship was intended to serve children and has done a very good job at that and we believe that it should be reauthorized and we should be focusing on providing health coverage so those states that choose under the law it's legal to cover adult children maybe we should ask those states pay for the cost of that coverage with that  unreasonable request of the states we believe that those adults who are covered we do not propose to remove them but we do not propose to allow additional adults to be covered and think we should focus shi on children on children and again your definition in my definition and probably one hundred percent of the diocese here on both sides a child is somebody under age living with a guardian or at home sometimes in a institutional setting that definitely somebody who's not yet ready to go out in a world and take care of themselves in most cases when agreement what should we do about those what information what is the minimum requirement in the law to be covered under the s chip program is it one hundred percent of pod federal poverty limit hundred fifty percent two hundred percent what's kind of the minimal what the states were first of all toward those the in the lowest income would be covered under medicaid children who had greater income than medica but under a limit the stablished by the states were permitted to be covered by s chip the state was then provided substantial flexibility and the means by which they would be covered but what's worse kind of the basic bar  level averages two hundred s so certain states approach to the federal government receive waivers to in my home state of texas what is it two hundred percent i think it's one hundred eighty in texas hundred eighty in texas  new jersey's taxpayers they choose to cover it three hundred fifty percent maybe they should pay that difference we do believe that it's reasonable to have state differences in the states but we also believe the states have an obligation to meet their share of it and that there needs to be some equity in the way i mean that's one reason that mr paul own state is going to spend its money in the first two months of this year and the state of t allotments and many states most states chose to manage those allotments to where if they were getting to the point of their budget running out they slowed in all months other states did not and those who did not tend to be on time just expired authority to negotiate medicare prescription part d drug prices for all the senior citizens of america adding feel about that i don't believe that any one person is as as an efficient market the efficient market that's been created is working in a way that has driven prices down and kept customers happy and we think the system is working well thank you mr chairman thanks  from new jersey just flown for five minutes thank you mr chairman you know i'm not going to get into this state by state saying because i think it's relevant to the fact of the matter is we know and the president says when he's you know of good conscience that he cares about covering kids and the uninsured and whether there's some you know woman who'd whose kid is you know on the street and can't get you know health care in texas versus new jersey it doesn't make any difference to me i think they should all be covered and if you listen to the president's rhetoric he suggests that they should be the problem is that even though mr secretary you're saying that s chip is a priority and works the reality is that what you're proposing or what the president's proposing is going to cut down on the number of kids that have health insurance and i think that's a national disgrace and it goes against the rhetoric that the president is using in his state of the union address and when he's out on the road if he wants to cover more kids he's going to have to put more money up front for the s chip program and effectively he's not a number of children's health experts estimate that it would cost approximately twelve to fourteen billion dollars over five years to keep up with medical inflation to prevent currently enrolled children from losing their coverage so if you're giving five million additional dollars billion that means less kids are going to be insured and more kids are not going to have health insurance whether they're in texas or they're in new jersey or wherever they happen to be and at least another thirty five to forty five billion over five years is needed to reach eligible but uninsured children and what you're effectively doing here is cutting back on the eligibility you know down to two hundred percent but we're not even covering the kids that are currently enroll with the amount of money that the that the president's proposing and in his budget i just have trouble understanding how the president's proposal to reauthorize s chip will improve coverage for children because common sense tells me that when you're under funded program and limit eligibility a number of children are going to end up losing coverage and i just have a couple questions do you have a sense of how many uninsured children currently eligible i say currently eligible for s chip will be enrolled because of the president's proposal to we have any numbers in that regard congressman can i just respond generally and then to your specific it is the belief of the president and my own belief as well that every person in america needs to have access to an affordable basic policy there are two divergent views that are presented on how we should arrive at that point one view is that the federal government essentially should insure or provide coverage to everyone the other view is that there is a basic federal responsibility to care for those who are the most needy and then that we have through our state government's responsibility to assure that there is a market where people can buy a basic fordable policy this week i met with the governor of course line from the state of new jersey who shares that aspiration and there's ayers to see every person have an affordable basic plan recognizing that there may be a difference on which children should be covered by s chip we have agreement on the fact that as chip is an important component part and that if you are a if you are poor or elderly or disabled or or if you are a pregnant mother in a low income situation or if you are a child they need protection you'll get coverage as chip is a very important part of it mr secretary i just don't want my whole time to run out the problem is this is a budget hearing and we're talking about dollars and i have no reason to believe if you have some reason to believe otherwise tell me have no reason to believe that the level of funding that's being proposed by the administration is enough to even pay for the kids that are enrolled now let alone expand it in most states are  kids eligible and not unrolled in the s chip program than there are actually enrolled so if you can't even keep up with your budget numbers with those who are currently enrolled because inflation we're never going to get to the kids that are eligible even under your two hundred percent and our children not adults we're never going to get to them and the president goes out and suggesting he wants to do something about it for him to say well ok that's up to the states is not solving the problem because we know that a lot of the states don't have the money congressman let me make clear that we view the proposal we have made as being adequate to cover those children who are currently covered under s chip and to cover the program that's currently constituted let me as you know not view that as chip is the vehicle to cover all children ok but let me just say that it is currently have fifteen minutes left at the same time or you have significant cuts in the medicaid program now and it's just the simply supplemental to medicaid and doesn't cover as many people as medicaid if you cut medicaid how are you going to make up for the lost of the uninsured there we are not proposing cuts in medicaid we are proposing savers to reduce the growth rate and at some point as we go through if you'd like to go through individually i'd be very pleased to reconcile the reasoning that we use in how we made those decisions the management of a program as big as medicaid demands that you continue to look for ways deal for eight minutes thank you mr chairman i'm a secretary thank you for being here and recognizing the difficulty of anyone trying to explain budgets as large as the one that you preside over but i thank you for being here and willing to entertain our question and i for one welcome the suggested changes that you are proposing to the s chip program and let me tell you why first of all it is a block grant program as you indicated and if my figures are correct the current poverty level in this country is twenty thousand six hundred fifty dollars if i take that and compare it with the two hundred percent of poverty that you're talking about proposing for  one thousand three hundred dollars for a family of four and speaking of a family of four now if you go from that level to what we find in some states at three hundred fifty percent of poverty for a family of four it takes it up to seventy two thousand two hundred seventy five dollars which is the current eligibility level that some states have for their s chip program not quite frankly in poor states like the state of georgia and many other states that are considered poor if we were to extend  eligibility for us chip and extend it to the family itself which is being done in some states at the level of seventy two thousand two hundred seventy five dollars my state would being great shape but the reality is that's not practical and i think what is happening with the s chip program an idea that certainly was welcomed at the time it has gotten out of hand the waivers that have been granted for expansion of the program are at a level that we just can't simply  it and i welcome the changes that you suggest would you give us a brief overview of why you're suggesting the changes to the s chip program i'd like to put that the congressman in the context of our vision that every ought to have an affordable basic plan we think that s chip is an important component of how we insure specific populations but if we use as chip as essentially the engine to pull us toward a point where everyone is covered by the federal government we don't see that is in the interest look at medicaid and the reforms that are proposed there as i understand the proposal the f map formula for all states would be at fifty percent is that correct we proposed on administrative expenses only that it would be at fifty percent we see a continuation of f map as it currently is with respect to reimbursement of health care costs i say so it's not that fifty percent across the board ok well obviously that would cause some concern for the poorest states who are at or higher if matlab for reimbursement for services i appreciate the clarification on that let me also compliment you for the proposals that you've put in place with regard to building on the reforms that we worked hard to put in place in medicaid reform during the last congress and i know this committee heard from the national governors association who were basically leading the charge for reforming medicaid because every state was facing crises with the funding their own portion of the medicaid formula  briefly highlight some of the proposals that you are making for further amplification medicaid reforms yes thank you congressman for example we believe medicaid to be used for the purpose of paying for health care for those who are less fortunate we don't believe that it ought to be the means by which we finance schools there are there is a proposal for us to eliminate payment for some administrative functions that schools are billing us for we want to pay for services not for medicaid for a for administration another example is that we believe that we need to have graduate medical education in our state we think medicaid isn't the way to do that we think there ought to be a more rational way of apportioning the burden of medical education we also believe that we are overpaying for pharmacy medicaid is by far the highest priced pharmacy reimbursement not just in the federal system but in the in the private system as well and therefore we propose various savers all of these are savers none of these are cuts in medicaid all of this goes toward reducing the pressure so that we can make this a sustainable program well obviously one of the largest components of the medicaid program is long term care and last time we tried to make significant changes and i think we did move in the right direction for the reforms that this passed congress adopted one of those was the how much of an asset can you have in your home and still be eligible for the taxpayer to pay for your nursing home expenses and we had to because of compromises that were put in place we originally were to half a million dollars and we allowed under the change up to seven hundred fifty thousand if the state elected to go and you're recommending that that seven hundred fifty thousand be removed and that it be a cap and a half a million dollars we believe that a person being able to protect a half a million dollar home is is adequate in some cases that's even higher than under the bankruptcy statute leads obviously to a situation where a person has an incentive to acquire a larger home in order to preserve assets a person with a three quarter quarter of a million dollar equity in their home probably doesn't need to have public assistance through medicaid well i commend you for that position it was one that we tried to advocate we didn't quite succeed in keeping it at that level but i commend you for recommending it again with two with regard to medicare part d are you generally pleased with the enrollments that have occurred and the projected cost of participating in medicare part d and could you give us some updated information as to where that stands and it continues to be very good news we added over a million people during the recent reenroll meant we went through the you know with very few of the problems that occurred during the initial implementation during the first three weeks we now have well over thirty eight million people ninety percent of those who are eligible of those that have enrolled somewhere between seventy and eighty percent depending on the survey that you look at people are happy with this and they're saving money about twelve hundred dollars a year on average the average will estimate was thirty seven dollars a month this year the and the average will be twenty two dollars why it's because of competition that's don't take my word for it that's what the actuaries tell us and they tell us that when people are given an opportunity to have good information about cost and quality they instructing you could negotiate the drug prices i think one of the assumptions was that if you had the ability to negotiate on behalf of all medicare beneficiaries you would be the largest negotiating block in the entire health care industry my understanding is that there are some private insurance comp winnie's who because they ensure people beyond the medicare population actually have a larger block of population on his behalf they negotiate prices a mockery you are correct that negotiation or rigorous negotiation takes place now and that's part of the competition that we have seen plants very clearly have to perform at with the highest highest quality at the lowest cost in hack for five minutes i thank the chair and the secretary in two thousand to successfully include language in the best pharmaceuticals for children act now to ensure consumers know that they have the right to report to the f d a side effects they are experiencing with a drug this provision was intended to empower consumers and give the f d a more information to help identify adverse events and take the necessary action took the f d a more than two years to  proposal the spite language in the law that required a final rule within one year of an accident i sent comments in to support a proposal over two years ago yet no action has been taken by the f d a to finalize rule mr secretary take action to issue this rule within the next few months mr stupak i'm not able to give you a response now i'll give you one directly following our hearing by letter i would like to tell you that i share the concern that you have on drug safety and that ultimately the best way for us to begin to gather information on the adverse effect of drugs we'll be having an effective system of electronic medical records where we'll see those kinds of of those kinds of reports on an ongoing and regular basis what with all due respect mr secretary we don't need electronic medical records all this is a label on your prescription bottles saying if you have an adverse effect of this drug ask you this one short of poland drug off the market the f d a has no real in for some authority when it comes to post market regulation according to a recent institute of medicine report on the future of drug safety  enforcement options after a drug has been approved generally lie at the ends of the spectrum of regulatory actions either do nothing or participate or precipitate the voluntary withdrawal of prescription drugs doing nothing implies not taking action a potential health threat to the public and precipitating withdraw implies caving in to the drug companies financial interests therefore the institute of medicine recommends that in congress  ensure that the f d a has the ability to require postmarking assessments such as label boxes box warnings in fulfillment of post market study commitments by pharmaceutical companies again something we put in the best pharmaceutical act for children these conditions may be imposed before both and after approval of a new drug new indication or new dosage as well as after identification of new patterns of adverse events but again we don't know about adverse important roadmap to improvement and there is a general belief and i hold this belief that we can improve in the survey and we look forward to working with you and other members of congress to implement the prompt in the appropriate way the i o m recommendation what we have to do for coming reed why i'm asking about drug safety because that's a concern of ours it's been five years since we did the last one none of this is been implemented we're not allow legislation to go through saying you have to do things within a year it's five years while you may agree with the recommendations please tell us if you think there's other things f d a should be doing and hopefully we have some reassurance the f d a will actually do it let me ask you one more that we don't all and i why still have a minute left in the summer of two thousand and six dr trey sutherland chief of the geriatric psych you have tree branch at the end i h o i'm sorry national institute of mental health pled guilty to conflict of interest charges brought by the u s attorney's office these charges are based on investigative work perform any reason why two of the agency that you oversee have yet to this point mr sutherland congressman i'm not familiar with that specific case i'd be pleased to find out about it and give you a response in wri michigan for six minutes thank you madam chair and i appreciate your willingness to come up again it is a daunting task i wanted to follow up on mr burton is question on the s chip just for a moment i know that michigan is one of those states that doesn't package beneficiaries that are over eighteen participate i'm just curious to know how many other states are in that same category and is there a ceiling or a cap terms of the age of eligible folks that are able to benefit from s chip i don't know the number of states but i've learned a good number there i know there are three states who have more adults than they do children really so over over eighteen that's r last year under under chairman burton and it was with great bipartisan support that it was promoted and passed and i was part of the team that speaker gingrich actually put together back in the mid to late ninety's along with mr barton and mr mccain and others in the senate bipartisan group to double the level of funding for the n h s and it's my understanding that the c r that we passed this last week was carefully negotiated with not only the administration but on both sides of the hill and the funny level for the united in the c r that was passed in the house and is now pending in the senate included twenty eight point nine billion dollars for the and i for fiscal year zero seven i think that's the right number my question is in the president's budget we received yesterday the over eight budget but much of this is a function of timing as you know it's rather complicated what you're comparing to because of the introduction of the continuing resolution and i think the important thing is we want to support and i a budget that was you're seeing was prepared would have been prepared in advance of that agreement but you could accept a larger increase in the n h budget knowing that it would otherwise be a reduction from what we passed last seen substantial new investment there over the course of years we're focused now on making certain that the research we do continues to focus on new investigators and continues to operate in a way that we're getting new grants just thirty seconds we do support funding and i get the authorised levels we had one over on this entire committee on the reauthorization bill we had two on the floor and we had none in the senate and we did commit on a bipartisan basis that if we could get that reauthorization through we would support significant funding increases for and so we are going to continue to press for that i'm pleased to hear that there's been in this regard is that we have a number of hospitals i know i'm in my district that have done a very good job with the health team with a whole number of different efficiencies that they've proposed and my question is aren't you aren't we  point penalizing these hospitals that if they have improved their efficiency said to such a green that when we just take a slice an across the board cut that we're actually penalizing these hospitals in contrast of those that haven't undertak the same type of efficiencies is there not a better way to do this in years past even prior to this administration there have been a number of occasions where they have not funded the entire market basket  rule not the exception the rationale we used in developing our proposal which is point six five the market basket minus point six five is that we just took half the productivity increase that that med pac suggested that they would see which is one point three percent we figured let's have tax payers benefit half and hospitals can receive half of them that we concluded to fund the market basket for most hospitals your michigan last week in all met was to my state legislators in the budget that was set up yesterday the preventive health and health services block ran was proposed to be eliminated and one of the provisions that one of my state senators tom george had proposed was a greater emphasis on smoking cessation programs diet a whole number of different things it would seem like this would be a natural way where we could save money and i'm not quite sure how that fits with the elimination of this  program that was actually a continuation from last year it was a pill because it was oppose it last year you did it again if you're actually right you can all right my time is expired thank you gentleman from year and the principal reason that i was opposed is that in the last congress once again there was not an increase in the on age budget that would cover inflation and  as everyone in this room knows that over the last four years there has been actually a twelve percent cut in the and i budget and if you factor in inflation and the consequence for research is dramatic and we know that the president continues to adhere to the position that his tax cuts are sacrosanct but we realize that a price has to be paid in my opinion this is the area that pays the single greatest price because research is medicines field of dreams from which we harvest the findings that give hope to the tens of millions of families that are afraid that that disease which is already affected someone else in know that your hand in these numbers by president bush i just think president bush makes a terrible mistake when he's told that he has to make a choice between his tax cuts and research for all diseases in america i just think he makes the wrong decision and and while it is true that the republicans did vote for an increase in authorization well and i h that was before they voted against an increase in appropriations and the reality is that at twenty eight point nine billion dollars for fiscal year zero seven heading into fiscal year zero eight where there isn't going to be an increase there are tough choices have to be made in terms of who's going to get funded for the research which is going to hopefully solve find the clues at least that can lead to the solving of these incredible diseases which affect american families you know that you're put in an impossible situation here but i will say this that it is a moral choice which president bush is making it's the wrong choice fog greater than any threat from any terrorists to the average american is the threat to a disease which they already know exists and their family is going to afflict another person in their family that's the greatest threat to every family in our country and if there's an arsenal that could be used in order to give protection to a family that is age budget and i've done my you know from my perspective there is no more important issue that we're going to work on in this congress it will be to rectify this disaster area which president bush the white house o m b have created and i know it and i know that and i know that h h s you would welcome the money and you would use it well but i would again and i appreciate how you're going to try to spread it around in ways that might be more effective but it's much less money so i give you the secretary chance in the found the president's tax policies and and the consequences that it has for the and i each budget congressman i support the president's budget i recognize there's a difference in how you might have selected those priorities an area where i believe there would be agreement would be how we are choosing to use the number we have and i would like to articulate that to you because i think that would i think you'd be hard invite it know what i'm going to sing is what i like you to justify is president bush's budget makes health cuts health research cuts in order to protect tax cuts and that i would like you to defend the circuitry the president obviously feels it's important for us to have a strong economy and he views the tax cuts as integral to keeping a strong economy he believes the twenty eight point nine billion dollars that the american people invest in research every year is a function of a strong robust economy and that if we want to see the kind of research investments that we all aspire to have that it is critical to invest in the strength of the economy well again i respectfully mr secretary i disagree with president bush i think it's a misallocation of resources resources only thing and i each can fully fund the cutting edge research that the private sector won't invest in and i just hope that he really examines his decision on this issue otherwise he's going to leave a legacy in the most important research area in comments here i want to raise again some questions and see if these are things you continue to support these are issues of how we can save money again so much of the discussion here and on the hill is about the cost of health insurance and i know you are an advocate of working on the cost of health care through such issues as transparency and quality improvements that are a couple of issues i'd like to find out specifically from you is one that i raised earlier and it has to do with such things as the health care associated infection rates while we are all concerned about any illnesses or problems that occur or tragedies that occur in natural disasters cetera in our nation it still is amazing to me perhaps appalling is the word that the center for disease control reports  that now i'm submitting legislation to work on disclosure of that because pennsylvania is the only state that requires disclosure and makes it public i believe about six states make it a requirement but it's not out there i'm just  wondering what's some of your thoughts are and then work with this congress or this committee on trying to directly address the massive expenses go to such things that there are so preventable so many hospitals have been able to bring these numbers down to near zero but as a nation we continue to pay the bills that are not working this but there's plenty of evidence that it can be done i just wondered what your thoughts are on the how we can work to drive those costs down i believe pennsylvania is to be congratulated for their efforts to not only collect but to report information on hospital infections it is unnecessary and it is preventable and we need to move aggressively to make the information available and to reduce the infections the best thing we can do is to have electronic health information systems that will gather this information not only for the purpose of reporting but also to be able to compare actual performance to standards that have been established by the industry themselves i prefer to look for to work on that there's a second issue that you know i've spoken about the past well the president continues to maintain his emphasis on working with community health centers again i hope we can work on dealing with the issue that even we don't even have enough physicians and nurses to staff the current  i hope we can continue to work on that through such things as allowing them to be covered under the federal tort claims act it still is a deeply concerning to me and i hope we continue to work on that and finally i wonder if you can  some update on the transparency issues i know that the president sent an executive order last summer on this again so much of the time we're discussing the budget we talk about the spending and i think coupled with that should be how did ministrations working towards reform and savings can you give us some information how that is working what kind of savings you see coming out of that congressman and we often refer to the health care system there are likely is not i think a system that you can say is he is no economic system we have a large robust rapidly growing sector but there is no system there's nothing that connects them together we view the future to be a system of competition based on value and to get to that system we have to have four things the first is electronic medical records the second would be standards of quality that can be independently assessed and compared the third would be cost assessments that people can compare and the last would be incentives the president created an executive order putting the purchasing power of the federal government to implement those four cornerstones in federal purchasing we are now approaching the private sector and other large payers we now have ten of the largest fifteen payers in the country who are committed that we have fifty one of the largest two hundred we believe that by april we have a nearly sixty percent of the entire health care marketplace beginning to work toward those four cornerstones we believe within two years we will begin to see health care based on value in limited areas on limited procedures within five years we will see the word value or that combination of cost and quality as being a regular part of the medical lexicon in ten years it will be ubiquitous we are clearly moving on a pathway that will lead us to a transparent system of health care costs will be reduced because people will begin to pursue high quality and low cost and we know that when consumers have that information they make those choices medical records i know you're making progress on this i would like to see us move farther and congress move faster on some of these things were standards but please continue to push us as part of the budget it is too often ignored of how we can really drive costs down and not just find news ways of paying for it so i think the sector for come here and look for to continue to work with you thank you chair now recognizes herself for sixty minutes welcome mr secretary here mr secretary i assume continue we believe that we should focus our efforts on children that is to say those either eighteen now now all of those adult children who are covered right now are covered under way first that this administration has given to the states correct that is correct or a previous administration we would choose not to continue that practice ok so right now so so according to c m s we have six hundred sixty seven thousand adults currently covered under the  out of seven point three million people who are covered in s chip do those numbers sound right to you know is in the ballpark yes ok so my question to you is if you eliminate those adults and by the way those aren't just childless adults who are in extreme poverty eligibility to two hundred percent of poverty is that your position you'll now be able to cover all of the two million roughly kids who are eligible but unenrolled in s chip at this time let me be clear that we do not intend on and roll adults who are currently on the program we do intend we would pursue a policy that would discontinue the enrollment ok but to answer my question then if you didn't enroll any more adults then is it your view that you'd be able to under this budget to enroll all the rest of the kids who are eligible but on enroll it would be our position that as chip continue to operate as it does with state allotments in the state ok but but if you it's your goal to have all these kids enrolled in health and do you think this budget will be able to achieve that by reducing the eligibility to two hundred percent of poverty and not enrolling any more adults it's a simple question well and it goes to the heart of the administration's policy here the administration's policy is that every american should have access to an affordable basic plan and that as chip is an important tool in being able to provide a portion of those that access that it's important that we work with governors like yours to develop plans similar to the ones that he has proposed where we're able to assure that there is some kind of access available to every and do you believe no we believe that the budget is sufficient ok now for a family of four two hundred percent of poverty is equal to forty one thousand three hundred dollars under this budget a family of four making forty four thousand dollars would become in eligible for s chip coverage so if this family doesn't have access to employer based health insurance they're going to have to get coverage in the individual insurance market how are they going to be able to find affordable insurance for their kids the individual market does not perform in the way we aspire for it to and therefore the president has made two very important proposals one is to work with states like the state of california in developing proposals   there's an affordable basic plan where the federal government is prepared to help of those who can't afford it like the one that you spoke of but there's one problem that no state can solve and that is the inequity that comes when a person who is a teacher's aide or a construction worker or a student and doesn't have access to employers based insurance it's the inability for them to buy that month that after tax dollars and therefore the president has proposed to level the playing field there is no defensible reason that we provide a tax deduction to one employer to one employee who it's their insurance through an employer and not another so those are two important reforms that we believe will strengthen the individual market now well family had to buy a family of two hundred fifty percent eligibility so still not a very high income family eligible for s chip right now if they had to buy a private insurance policy and  texas one of the policy speech c d s that cost sixty one point four percent of their income one would cost twenty three point nine percent and one would cost twenty four point three percent of their income it's hard for for any of us on this side at least to see how is your policies this costly even with the president's tax proposal would would would would be able to afford those policies even with the tax relief your time is up man i've actually actually here set the clock wrong i have another minute this is that this is the beauty of interacting with the chair i like this let's assume that that couple that you've spoken of in and is texas let's say one is a teacher's aide in the husband works construction and they are sixty thousand dollars a year between them and that's about what two hundred seventy five percent i'm guessing out of the poverty level currently they would be hard pressed to have insurance for the reasons that you've spoken of but under the two proposals that i've mentioned first of all there would be an affordable basic plan available to them but we're hoping the states develop those they don't have that now correct many states do texas as a matter of it does but let's just let's just say for that for the purpose of this discussion that that the president's those were enacted in the way that it would be that couple would receive a four thousand five hundred dollars tax benefit and  therefore if the policy that they purchased would be four thousand five hundred dollars a year cheaper now let's assume that it wasn't enough and that the state of texas decided that they wanted to subsidize the purchase of that insurance policy we propose that the states would receive from the federal government assistance in being able to make certain that not only was a basic policy available but that a basic policy would be a affordable now it's possible that they would be people in texas who do not qualify for s chip that would be helped in this way we aspire for every american to have access to an affordable basic policy that s chip should not be the vehicle by which we insure every adult in every child in america there are different ways and i don't think anybody thinks that thank you mr secretary in my time has really expired now i'd now like to recognize the gentleman from texas mr burgess for five minutes is a complex yes formula very few people understand it i i personally believe there's got to be a better way i do as well and that's why i wanted to bring it up because we talk about the market basket for merely asking our formula is a finite fixed amount of dollars and we slice the pie everything or if there are more people who make demands on that pie are submitted invoices the volume and intensity increases on the call and the reimbursement rates go down but hospitals companies h m o's medicare advantage plans all enjoyed market basket updates which the administration has now said perhaps we should look at those market basket updates as a place to arrive at some saving so does the administration have a roadmap by which we may get to a more equitable system of provider funding whether it be a hospital and doctor or an h m o or or a drug manufacturer does the administration have a roadmap as to how we get there we believe that at least some portion of physician reimbursement ought to be based on the quality of the services that they render and the outcomes that they produce we're not at the point at this moment that we can base large percentages of it but some portion should the roadmap includes electronic medical records which allows the information to be gathered on both quality and on performance it involves having quality measures that can be independently assessed when the process of working with the medicals community so you want to have so if we do all of those things medicare which is an integrated program perhaps then the funding silos would not be quite so rigid between the parts a b c and b that would be our aspiration let me ask a question on a completely different front hurricane katrina been down to the fact our committee our when i committee had a hearing a little over a year ago down in louisiana charity hospital for the first quarter of fiscal year zero six received as i understand it or was due to receive about two hundred fifty million dollars in just proportionate share funds so called dish funds is that is that a correct assumption and just over a billion dollars a year where as the dish money that was earmarked for charity hospital where is that gone well let me  reconcile this louisiana receives just under a billion dollars a year in disproportionate share hospital money under the deficit reduction act another two hundred two billion dollars was allocated for recovery of the gulf region  we have allocated that money to the various states who were impacted to reimburse including texas to reimburse them for claims that they paid that were not otherwise compensated by medicaid we have we have allocated most of that money allocated or paid actually paid paid but throughout the health care infrastructure in new orleans as i understand i mean down there for several months but the health care infrastructure still is it took just literally hanging on by its fingernails and other moneys were made available through other means in dealing with with medical infrastructure and that's an ongoing discussion really easy and that properly wrestles right now with what they want the future of their health care system to be  do they continue to use their charity system where they have two tiers one for those who are insured and and floyd and one for those who are not and it's a very important decision and they have an opportunity to upgrade on a perpetual basis their health care system choose that perhaps that's a great idea for them but that should not be giving them more encouragement to move ahead move forward with this since there's a large component of federal dollars that are involved and just like my discussions with health care with doctors on the ground is that they are rapidly leaving the areas they're having to spend their own savings to keep their clinics open to see patients that cannot reimbursement reimburse them because they have no health care coverage wouldn't we be better served by keeping those people on the ground and functioning working in the gulf coast area rather than allowing them to disperse throughout the country and then trying to rebuild it whenever it's take it around to it two weeks ago i sent seventy one million dollars to the hospitals and fifteen million dollars to the doctors and clinics for the purpose of whatever their need was but most of them will be spending on wage upgrades did that have to go through a state agency for those hospitals and clinics to receive those dollars it did but the grant was made in a way that sure that those dollars are received by the hospitals what makes me look forward to following up with that let me just ask you a broad question my time is about up president bush and i actually disagree on the family question question of how to deal with immigration reform in this country and my side lost last november so i've got to assume the president is likely to get his wish in the coming months in all of the budget that we're assessing today is or is are how does the administration propose that we deal with the health care needs of ten to twenty million people who may be of this country illegally as as as they then get in line for citizenship of the larger question you ask is how do we pursue uncompensated care and in my judgment  here today i still am having a lot of trouble understanding how the priorities were determined in this h h s budget especially after seeing the devastating cuts you've referred to already it's from one hundred fifty million to one hundred five point three million imposed on diverse workforce development this includes elimination of programs to strengthen advanced practice nursing and it comes after three years of flat funding keep in mind that back in one hundred seventy four congress appropriated the equivalent of over six hundred million in today's dollars for nurse education programs i'm sure you're aware the projections are that by two thousand and twenty our nation will see a twenty nine percent shortage of nurses her say itself reported in april two thousand and six that nursing schools would need to a drastic increase the number of graduates by ninety percent in order to address the overall shortage of nurses you referenced this in your opening remarks about training new nurses but i would really rejoin that you can't train new nurses without nurse faculty and these are the people who need these advanced degrees and loan forgiveness for nursing students doesn't help if there's nobody to teach them and so i want to get on record very basic question to you do believe don't you that nurses are essential part of our ability to deliver quality health care i do and i'm sure you also agree with the seth months by h h s agencies that our nursing shortage is going to continue to grow if current trends continue and if we continue to use current practices in the way we train them ok there are many ways i believe we could expand that with with right and you just said that's a subject for another discussion you probably know that involvement in nursing schools growth only five percent from two thousand and five to two thousand and six but that over thirty two thousand qualified applicants were denied admission because of the nursing faculty shortage and a lack of clinical placement so it's pretty clear that decreasing funding for nurse education programs by forty four million dollars is only going to harm our efforts to build a properly staffed work for nurse workforce and i'm also considering the emphasis our president places on bioterrorism in the flu preparedness i believe it's blatantly counterproductive to die from the front line of public health workers who could respond in the face of a national health emergency preparedness efforts are incomplete in absence of a properly staffed public health workforce and i do want to ask a follow up question i do have half my time left and this is a big topic but i'd like to know what the rationale is for these cuts in this budget just to highlight let me indicat as i did before that we were following for example the g a o assessment which indicated they believe they were underperforming programs we also believe that they were i'm sorry they were underperforming programs th current nursing schools roads and the grants that were being offered that we're proposing to be reduced in g a o believe and we believe we're the best way to expand those dollars i do believe that we do that investing in the development of basic nurses infrastructure is in the yes the current you understand that we do have to have some kind of faculty prepared what we obviously do but i'm not certain personally as you say this is probably a conversation for a different day but i'm not sure that we ought to be dependent completely on  the large medical nursing school math that we've got to find ways that will produce money that could well be but well going to have to have some kind of faculty some kind of specialized personnel to impart the body of nursing knowledge to the second to the incoming population let me go on because maybe we'll get maybe we can come back and visit that topic i am to understand also i believe in this budget that nurse nursing education funding needs to be cut by one third from last year yet there is enough money to increase unproven abstinence only education which the g a o itself concluded uses federal funds for an unproven scientifically inaccurate program that lacked oversight now i want to underscore this page this budget in actual dollars has two hundred million and more in funding for abstinence only education but one hundred and fifty five dollars for nursing education i'm going to go out and talk about one other topic and come back to that if you want i just want to make sure that i get another very big concern of mine out on the table and that is these budget cuts in funding for the national cancer institute that's been brought up before two thousand and four cancer deaths drop for the second consecutive year it is likely no small coincidence that the declining rate of cancer deaths coincided with an increase in funding for many years and that tells you something about the way that death the way that is required for many years but this year n c i funding is being cut even now the national cancer institute can only approve funding for eleven to twelve percent of applications compared to twenty five to thirty percent in past years i don't think it was ever high enough how can you justify impeding progress when this country is so committed to the twenty fifteen goal of eliminating deaths from cancer you were recently quoted in a national journal article saying that we all want to invest more but it's a function of capacity and i refer back to my earlier question about the decision to fund unproven risky programs over a life saving proven research i wan ask you what is the justification for cutting cancer research i know from personal experience as many of us do that it's not intel stage three you talk about new cancer research but it's not intel stage three trial that these this research comes to bear the kind of fruit that will actually and literally has saved thousands of lives cutting cancer research funding i believe will directly impede our ability to reach the goal that so poignantly  to end deaths from cancer by twenty fifteen and i'd like to have you now respond and that the time that i have for how this is going to happen congresswoman let me reiterate the fact that i'm with any one of us have not been touched in some way by cancer and none of us who don't want to see it and celebrate our progress i will point out we're not eliminating cancer funding  it's still the largest what cation of funding to and i age in excess of four and a half billion dollars a year what we have chosen to do this year however is to begin to award more competitive grants that we believe put i thank the chair welcome back secretary leavitt sure this is one of the most fun parts of your job but we very much appreciate you joining us again at the committee and we are certainly very fortunate to have somebody of your caliber and your integrity serving in this very very difficult capacity we thank you for your service sir to say i want to talk a little bit about pandemic flu you and i have discussed this on a number of occasions before  we've discussed preparedness we continue to see reports in asia and africa particularly in egypt and nigeria and now we're even seeing reports in europe about the sport of about the spread of avian fl u the last stories i've seen point to sixty three deaths from bird flu in indonesia and very alarmingly eleven deaths in egypt for the record since it's been some time since we have had a chance to discuss that i'm sure you would continue to agree that it remains just a matter of time before this or some other pandemic strain mutates and is spread from person to person if if you disagree with that please feel free to to say so but i i continue to be very very alarmed by that to date my understanding is that you've requested in the congress has appropriated about six point one billion for the implementation of the seven point one billion  national strategy on pandemic flu i understand you've also are requesting eight hundred seventy five million nearly the final billion that would complete two or  fully funded the national strategy can you very briefly and generally talk for a second about the what has been set aside for both antivirals and vaccines and and what has been spent of what has been set aside for antivirals and vaccines our pandemic plan can well be divided into five parts the first would be the development of vaccines much of our  seven point one billion is in volved in development of new research as well as acquiring stockpiles we make continue to make heartening progress we have released contracts and now both on anti  vaccines but also new anti virals we've also made progress in the area of agilent technologies i can tell you that by that that we're making progress toward our eighty one million courses of tamiflu for example we have zero eight we will complete the twenty million course and a viral stockpile purchase to maintain the function of our health care system and to provide anti virals for our first responders and t stockpile an additional twenty four million treatment courses for the treatment of n of influenza we currently have we're working with the states to complete that all the states are taking advantage almost all of them there are four who the budget request is for this year is for eight hundred seventy five million again we don't know when budgets are finished around here we certainly don't know when they're appropriated i would ask you to consider that if if the administration is going to be submitting  a supplemental this year any kind of an emergency supplemental others for the war or anything else that that the administration would consider including the final billion dollars that would fund this the national strategy on pandemic flu that that might be included as as has been looked at and on in the past i see this is a very urgent matter i think it's a ticking time bomb as it's waiting to explode and i just think the sooner the better that we that we fully fund and finalize the strategy i think it will certainly be in the interests of the health care of our nation in the minute a half i have left i just want to turn to one other topic the budget that we're talking about today embraces the goal of personalized medicine instead of this one size fits all approach i think that's something all of us would support particularly with new technologies that we have today and in diagnostics and in other areas as a secretary i just wanted to call to your attention legislation that i've supported in the past and will continue to support which would allow this tremendous gift of molecular diagnostics to help identify the types of treatments that are appropriate for each different individual it is certainly the way of the future it is it's a better way to treat diseases it's a more humane way it's a more cost effective way of  treating diseases for example there's a test which we did which would indicate if someone would respond in a particularly positive way to a breakthrough breast cancer drug for instance as you know this can make a tremendous difference in finding the most effective and efficient way to treat a deadly diseases and i would ask if you might be willing to work with us to move that type of legislation forward during this congress review th of great promise also say one of the things that the congress to do that with accelerating would be passing a genetic discrimination protection there is great worry that as we gather the information that's necessary to do the research and organize it in a way that will help us make the breakthroughs here that people will be discriminated against and we need to give them the comfort of knowing that they cannot be and that bill i think will probably approach the house of representatives very instructive i know secretary i believe i was scheduled until twelve thirty may i ask madam chairwoman if we don't have the opportunity to ask questions that the that we submit them directly to the welcome in our dealings in the past when you were d p a i had the pleasure of working with you on some issues and i want to know why i think you've done a good job there and i think you're a good person and i also think you have an impossible task trying to defend this budget given the constraints put upon you by the president i want to talk a little bit about the affordable choices and suggested that maybe i need to think about going back to the drawing board on this one i've been in the insurance business since one thousand nine hundred seventy five i'm licensed in alliance of insurance i used to sell a lot of health insurance policies seems to me that that the end result of the program president's proposal of affordable choices is to put  many more americans into the individual insurance market the most costly of the markets group insurance obviously being less expensive than individual insurance the problem that i find with most working poor that don't have insurance isn't that they can't get insurance they can afford insurance when you look at the president's proposal and he cites that a couple making sixty thousand dollars a year with say forty five hundred dollars in taxes now that's assuming they're self employed and are paying the fifteen point three percent and social security medicare tax but if you have someone that's working poor working for someone else their actual savings is more like thirty four hundred dollars this is a couple making sixty thousand i don't know about the rest of the country but in pittsburgh pennsylvania the people that i represent most of the working poor in my congressional district aren't making sixty thousand dollars they're making between twenty and thirty thousand dollars and their employers aren't offering them insurance and the deduction that the president proposes would put far less dollars back in their pockets than the thirty four hundred dollars cited by a couple making sixty thousand i don't believe a couple making sixty thousand could find individual insurance for three hundred dollars a month and i certainly know a couple making twenty to thirty thousand what would they be placed on the market the second point i want to make though and get your response to is the impact this has on those same families this is like a double whammy what we're basically asking the working poor in this country to do is to trade reduced retirement benefits in the future for some assistance in trying to buy health care today and the reason i say this is is that the formula that th determines what you get in social security payments is based on how much you pay into the system and how much your employer pays into the system and for those people that are making one hundred thousand dollars a year that the people that are you know at the max and above  under this formula they get about a fifteen percent reduction in their benefits social security but when you apply the same formula to the working poor people making between twenty and thirty thousand dollars a year and they're not paying any of you know they're getting this fifteen thousand dollar exemption to social security their benefits i saw a study that was done by i'll i'll give the name of the organization the tax policy center in washington estimated that their benefits could be cut up the third up to fifty percent so it's sort of a double whammy on the on the front end we're not giving the working poor enough dollars to go out and purchase insurance in the private market in the individual market and on the back end we're cutting their social security benefits because of this of this fifteen thousand dollar exemption that they've taken advantage of so my question is how does the administration proposed to make up this huge loss of retirement income in this plan for the very people who rely on their social security payments the most i mean i don't believe the administration has something against working poor but it just seems to me that they get it on both ends of this deal they don't get enough money to buy insurance in the private market and they get their social security benefits reduced on the back and i think that's a terrible dilemma to quarter our people and i just wonder how the administration proposes to make up for the loss of the retirement income congressman there are two parts of the proposal that the president has put forward the first is that every state should have an affordable basic insurance plan that's accessible to every citizen that means they first of all need to make certain that it's available for sale and then second of all they need to make certain it's affordable that's an important distinction because the tax benefit has not been intended to be the sole means by which a person who could not afford health insurance how does it's done mr secretary how do you how do you force or compel states to offer this this affordable insurance since we're you know we're a free market people here and we're not going to walk to the insurance industry and you know be heavy handed with them and tell him they have to cut their premiums and lose money i mean how does that happen well the president has asked that i meet with all of the governors and over the next hundred days i'll see almost all of them pennsylvania is currently if you're governor is working on such a plan governor of california governor of texas governor of washington governor of wisconsin governor of michigan governor of i can go all the way across here and i am currently receiving proposals from your governors to do exactly what i have suggested and that's creating an affordable basic plan but they're going to need help in two ways to make their plans work they can't solve the problem of the discrimination that they receive on taxes and there's no way to justify that we have to fix that one way or the other and the second thing they need help is they need they could use some federal money to help subsidize those who can't even afford a basic plan and that's all we're proposing we're going to do for the senior of the working poor back to normal primary retired and i think that's a that's a big concern to secretary i'd like to take this moment to to ask you we really do appreciate you being here with us this morning and a lot of good questions some post sides of the aisle i count seven members here who has not had time to question and i'm just wondering i know you're you have scheduled to be here tough thirty is there any way you could extend that tell one o'clock so that we could give the members who are remaining the ability to ask their questions signed a law establishing a national prescription drug monitoring program secretary thompson former secretary thompson supported the legislation  legislation and last year we worked out and the legislation house that program at h h s and we pass that legislation because prior to that without authorization from anyone some members of the appropriations committee i stablish in the earmark that provided funding at the department of justice and they it was a mechanism that really didn't provide justice would receive five million dollars until we could get them meshed together at h h s and in this budget that you just submitted there's no money requested for the nascar program and i would e it's a program we support it's a program we would gladly administer however it is a decision that was made at o m b to view it more as a law enforcement program we were  i say that not as a matter of complaint other than just explanation that we're in a place where we don't control that decision and i'm happy to sponsor more conversation between you and those who do well thank you mr secretary madam chairman i might say that i think it would be appropriate for our committee to get a letter over dell and be on this issue and also to work with the appropriators to see to it that the authorized program at h h s where it should be  myself and that in a number of us on this committee work very hard to get the naspers program authorized and we do think it's very important and i don't hear you saying you disagree so i think that you know we should initiate that letter i'd be glad to co sponsor it with my colleague from kentucky and try to get some of this funding in during the appropriations process and i appreciate your bringing it forward because i do think it's crucial to out with is that december fifteenth two thousand and six the congressional hispanic caucus task force on health sensual letter and we have yet to get a response back and it's regarding your interpretation of the documentations that are now going to be required for newborns and i wanted to ask you if we could get a response or if we can expect one and how soon and also if you could please explain how that policy is somehow going to help us achieve a lemonade in health care disparities with respect to under represented communities congresswoman i'll confess to you we work awfully hard so that i wouldn't have to answer the question why haven't you answered my letter do most of our letters our current and follow up to find out why yours isn't and i'd like to submit the record that we sent for the record if i can request unanimous consent of the chair and when was the slip it was a december fifteenth well it may be that so we still count that as a current letter we're working on and ok so that when can i expect a response soon soon ok can you explain to me a little bit about that regulation and how you see that fostering identifying these under represented groups you know i think i would then you get a better response in the letter because i'm not certain i'm in a position to enlighten you very much on it ok one of the questions i had it and you didn't go from your text that you submitted but i want to ask you about your adolescent health promotion initiative seventeen million dollars does that include extending the ads abstinence programs only that's a separate proposition it's a separate problem and one of the concerns i have and something that the hispanic community in the caucus is very concerned about is the increase the actually the upsurge or up upping of teenage pregnancies a month amongst the latino population it's well above i would say in some cases twenty percent in fast in fact the statistics prove that fifty one percent of latino teens get pregnant at least once before the age of twenty and for african american it's fifty seven percent become pregnant at the age of twenty so obviously the abstinence program is not working well and one of the concerns we have is that information be provide it in a culturally competent linguistically competent manner and i've yet to see any evidence that that's happening in all the years of funding for these programs can you respond to that we provide information to people in lots of different ways and the abstinence program is one of those that we pursue and there are those who believe that it ought to represent and i'm among them at least part of what we teach and part of the way we teach and it's a it's it's part of the ideology of the administration and you can expect it will continue to offer those proposals ideologies and i guess one of the words that would concern me there because in many instances it's hard to reach these these youngsters as it is and having nontraditional modes of outreach would be very i think very important and a much improved effort to to get to these youngsters but also  employing some new methodology maybe looking at what works for us in our communities along the area of not i want to say social work but people who are out there promoting health care prevention and you probably are well aware of these california other parts of the country actually in some of the counties and local municipalities and even taking it upon themselves to create these programs to extend campaigns of information to the local immigrant community not just like the you know but other hard pressed groups so i would hope that that might be something that we could discuss with you about in extending services by way of outreach campaigns to these at risk communities i think you'd find that many of those campaigns have at least some federal money same charge of the other programs that you advocate them if that's if the fact that we continue to see an increase is a function of the fact that the programs aren't working and then you have to make the same indictment of both i mean we're all working at this we all want to see those rates come down there are there are some good signs that that they begin to but we believe that it's important to have abstinence as part of what's taught one of the other concerns i have with respect to the ability to train future physicians not only in the nursing area but in the medical field and as you know hispanic serving institutions don't receive this much monetary support in terms of adequately outreach and in recruiting to the latino community to prepare for that potential growth and service it's it's going to be needed in coming decades and i would hope that you would reconsider your formula for funding to help promote for more recruitment especially given the fact that in states like california where you have a number of medical institutions we're not seen that kind of support coming through the federal government guys briefly comment ye actually we believe as you have suggested that our funding ought to be oriented toward areas and specific communities of need and not allocating money on a general basis and many of the programs you see reduced in the area of nursing and other professional development you'll see were reduced because they did it in a uniform across the board we are the target are money into areas where there's specific needs chair now recognizes reaches throughout our society so i appreciate and appreciate you staying past twelve thirty because i get deadliest visit with you for a few minutes i'm going to have three primary  areas one is kind of a macro issue and then i'll go down to a few specifics the first one is just on the overall debate on medicaid funding one of my frustrations is i think we talked about this before is f map finding the differential between states you know that as your former position and then the games that those of us who are of not at the high levels of aftermath ratios the things we have to do to try to make up for what we feel is a loss and that duty at the hospital susman in two years left in this administration i would really ask that we we try to make a bold move it would be tough for members across the country to defend inequities in a federal system and there will be some states who to rectify the differences would have to make some tougher choices and i understand that but i just i just feel that until if we keep doing this gamesmanship and find these other ways it just distorts the system and makes it very difficult for people understand and then we develop new programs to compensate for the loss of revenue and if you could respond just briefly i'll go on to the other two  congressman that's essentially our view we would like to see us have a straight up formula where people put up real dollars and the games that are played that have historically distort the cyst and but you could help lead with that but the budget debate on the ratios that the there's no question that funding formulas are tough and they're the toughest debates in congress and that's where they start and that's where they get set we administer them as best we can but  highlighting i would be receptive to that the president's health centers expansion initiative has successfully increased the total number of health centers to over thirty eight hundred when i first became a member of congress now my district this change a little bit i had i do not have a single community health center now in my enlarged district of parts of thirty counties and i don't know i i have thirteen and it's been very very successful program the president's high poverty counties initiative has been outlined as the next step can you explain that a little bit more fully for me the president made clear he'd like to have twelve hundred new during the period of his service we're going to achieve that congress being willing he also then later said and i want one hundred eighty of those to be targeted at the highest need areas that is to say the areas with the highest levels of poverty and so some portion of the allocation each year is given priority for those counties and the great thing about community health centers is that they do bring in the community involved and there's a partnership and again it's been very helpful and passed try to get a handle on this process this recent g a o report and to the great excitement of some of our constituents and the local pharmacist and those people the g a o report makes a promise that that the answer as stated would be less than the cost of the retail pharmacy for the purchase of the drug obviously that wasn't our intent we want to get it to where it's competitive where we can control costs but we don't the local pharmacist play a critical role in the health delivery process and if they're not going to be compensated for just a break even then they're not going to they're not going to provide that service so can you address that and what steps you might be doing to relook at the amp and and how we can get to some accommodation congressman i spent a lot of time behind pharmacy counters in the last year talk me to talking to armistice and it's become clear to me that most of them could run for mayor in their town and when they're very popular people because they meet needs and they they obviously need to be support i just need to tell you we fundamentally disagree with the conclusions of the g a o report on this we just disagree with their conclusions and we'll offer more information about that later we know that they need to be supported we just can't we just can't come to the same conclusion they did and i've got twenty seconds left and i the other issue that we debated before was a dispensing nature of a dispensing fee where your thoughts on that that remains a state option my time's expired thank you madam chairman gentleman from mr secretary i'm i'm pleased to tell you that by working collectively in a bipartisan manner all of the other members have agreed to limit their time who are here so we hope you can for all of these  heard in the state of the union address as the president was discussing health care matters a brief reference to state innovations and that's going to be the subject of my second question to sort of find out some more particulars surrounding that proposal but i want to start with a different state innovation and that is in wisconsin it's very successful prescription drug program called senior care senior care in wisconsin provides affordable drug coverage to over one hundred thousand wisconsin residents at prices that are significantly below the party prices and i think i believe it's a shining example of what every government program should be senior care it's easy for seniors to enroll and it involves a one page form that they have to fill out it's cost effective and studies in our state have shown that for every dollar spent on senior care  leverage is an additional four four dollars and thirty five cents from other nonfederal sources it is comprehensive because it has no donut hole like part d and for all of those reasons and others it's an extremely popular program i'm a big fan of the program and i receive an unbelievable amount of feedback from constituents praising the program but also begging me to do everything within my power to make sure that that program is allowed to continue as you may recall senior care operates under a pharmacy plus waiver that waiver is set to expire in june of this year and wisconsin has submitted its waiver renewal application in june of last year the entire wisconsin delegation republican and democrat alike have sent you a letter supporting this application and yet we have not yet received a response  allowed to continue ms baldwin thank you for your effective and cheerful advocacy i'm quite of where senior care not spent a fair amount of time with governor doyle reviewing the waiver as you fully conscious senior care came about before part d was on the scene and it now does provide hundreds of thousands of wisconsin residents the best part  be we continue to analyze the waiver request i think it i've been quite clear with the governor however that the federal government is relying on part b for most of what we're providing the seniors and while we haven't act might expect i might add that waiver senior care could certainly continue the issue is whether or not the federal government contributes money in wisconsin and not in other states for that purpose and so it's a that that becomes the issue of course of crucial innovation in his state of the union address and i think that we can all agree that the proposals that we're seeing in states like massachusetts california maine and my home state of wisconsin represent real progress in the debate about how we best expand access to health care that said and i've authored bipartisan legislation to promote such things however i noted the president's proposal involving state initiatives is limited to initiatives that use the private sector to expand coverage and i don't think we should limit the states in that way we should really encourage thinking outside of the box innovations beyond that narrow ray that the president may be talking about and i'm wondering if the administration is opening to allowing states to test other initiatives as well we're interested in two things one affordable basic plans let me just restate that basic plans and to making them new jersey i've been in that i mean virtually i can see every state but most states right now are very focused on this but there are two problems they cannot solve on their own least one of them and i've mentioned it a couple of times today they can't resolve this discrimination that occurs between people who buy it in the employer market and those who don't have that opportunity and we have to solve that problem if we're going to see the kind of innovation that you and i both aspire to the second part of this dilemma is that once you have a basic health plan there are still going to be people who can't afford it and that's the point at which we need to step up and be able to help people who can't even afford the basic health plan that we're looking we're looking for opportunities to do that that gentleman from mississippi mr pickering is recognized for four minutes thank you madam term chairman thank mr secretary for your leadership and thank you for all the help you've given to my home state of mississippi as we recover from katrina how let me quickly go through some questions first as you know we passed a combat ing autism act in the last days  congress which increases the authorized funding to around one hundred sixty eight million dollars and that includes funding for us secretary to lead education early intervention and detection c d c has significant funding and then  is a coordinating agency my question is do you support fully funding those authorized levels or what is the current plans in the president's budget and as the secretary for finding those  initiatives we will in fact use whatever the congress appropriates in the most efficient way we possibly can we recognize that the discussion of how much of the authorization we funded will be part of what is resolved and hopefully in this congress so you support whatever congress appropriate this is your answer i think you i think you know that i support whatever the president proposes yes you know what the president proposed i'm on autism funding is you know if he proposed anything in that funding or in his budget where that is relevant is that the c r is not specific and doesn't give you i don't believe in any direction said one hundred twenty three million as it relates to autism if you could please let me know how you break that down between your and look forward to working with you on these very critical issues as you know one in one hundred sixty six of america's children is now diagnosed with autism alleges spectrum disorder which is more than to the actual cancer diabetes as we go forward on aeneas your budget reflects the emphasis on using health information technology to create efficiencies in transformation of our health care delivery system and on this there's one component that i'd like to ask and this is as it relates to remote monitoring of patients for this diabetes are those who suffered from congestive heart failure do you support in setting remote monitoring mine monitoring through the physician fee schedules i support first of all developing standards that will allow us to assure that remote monitoring is compatible with other parts of the electronic medical record  second to the degree that we're able to identify clear financial benefits from it then it's something very clearly we ought to consider look forward to working with you on on both of those efforts on the standards and on whether remote monitoring candy used in the well just in closing and this is not a question but just and encouragement that i hope that you go back and look at the  thank you for your service and your patience whether it's policy or physics but i like to think in terms that for every action there is always opposed an equal reaction so as to be the reaction to the consequences of what the president is proposing you seem to proper that it's all it's going to be a good reaction but there are those that would disagree with you and the administration so what i always do is i just go back home and ask the people in the health care field what are their greatest fears regarding the pres two thousand and four we're talking about new patients being accepted by positions in the state of texas under medicaid it used to be forty five percent only forty five percent in two thousand and four in two thousand and six it's a declined to thirty eight percent  doctors accepting new medicare patients in two thousand and four sixty eight percent today or last year that is in the year in the survey it's sixty two percent in two thousand and two those medicare patients new ones were being accepted at about seventy five by seventy five percent of the physicians in taxes so one of the possible reactions is we're going to have fewer doctors tending to the patients under both medicare and medicaid and i just want your opinion when i when i finish with the other two examples the next concerns expressed by method hospital out of san antonio what health care providers in today's were all must deal with costs associated with emergency preparedness bad debt the uninsured and expansion of services  facilities to better serve their communities how can the end result of these cuts not trigger an increase in health care costs to the private sector which would correspondent we increase the cost of health care insurance for everyone so again this to be the reaction is not a positive one it drives the cost of health care insurance up lasley christa santa rosa children's hospital the president's budget aims to do redirect medicaid d s h funding from supporting institutions to private health insurance some hospitals serving high proportions of the indigent patients we go i have been late on medicaid vs age the president's budget has a double hit toward hospitals and that there are also cuts proposed on the medicare side as we talk about the need for hospitals to improve quality and incorporate health information technology are you concerned that this budget will make those things even more difficult quick response with respect to reimbursement rates as you're probably aware reimbursement rates for medicaid are set by the state and if they are beginning to see slippage in their patient acceptance the state something the state very clearly ought to deal with with respect to medicare we monitor those very carefully and it sounds to me as though they are relatively stable in texas though it's something we are concerned about on a continual basis bad that we think that bad debt is built into the rates that the hospital charges us and we think it's unreasonable for us to be paying both reimbursements for their bad that and paying right the bills that in as an expense as you pointed out they build it into the expensive bad that goes up then what the bad that reimbursement amounts to is essentially a foundation support for their overhead with respect to health care indigent care there are three areas that i'm concerned about and we have to be very careful one is there will be spite the efforts that have every person have affordable basic insurance are going to people who don't have it and hospitals need a way to get paid for that care that's a given the second is there are some public hospitals that very clearly need to have some support to keep their doors open we need to provide that but if we're successful as we aspire to be in getting high numbers of people who are currently having their medical bills perpetually paid by the federal government we can get them insured then there's no reason that we would need to pay the same amount of money that we're currently paying to the hospitals some of that money ought to be used to help people get insurance and so we're just looking for where that balance is we want to work with congress to say where is the balance we want to work with states to make certain that we're not well thank you for very overoptimistic look out look on the president's policy sure now recognizes her matheson from utah for four minutes thank you chairwoman and it's in my first hearing it's great to have my governor and friend secretary leavitt here before us being on the front row you get a chance to ask questions after everybody else has and they've raised a number of issues that are very important to all of us s chip  as g r even you mention the graduate medical education in an effort to try to have something different to talk about for the last question and i feel like we're all talking about these issues that are all of great importance somewhere ignoring kind of a broader issue at the macro level and that is i feel like our health care system in this country is on a path that's not sustainable the fact the matter is this country spends more by far than any other country in the world on health care for capita and by various measures our outcomes are not as good as a lot of other countries and if we're ever going to get around this effort of trying to find ways to make sure children access to health care or make sure we're training good doctors for all these other issues seems to me we also need to address the issue we have a system that seems to be going out of path where costs are growing above inflation every year and you've got to wonder how long that's going to last in the ridiculously limited amount of time we've got to talk about this i just like with highlights three items to see what your thoughts are  we often hear that lifestyle choices in this country are affecting and driving a lot of health care issues if we can get people stop smoking to eat well exercise we'd have a more healthy population i certainly don't support any government mandates on that activity i'm sure you don't either but other efforts we can do to try to address that dynamic to create a more healthy population secondly we're just i just heard this weekend at a retreat we were attending that in our health care system the united states administrative costs represent thirty four percent of all the money spent on health care and the next highest country in the world according to the presenter was candidate where it's eighteen percent of administrative costs this is private and public not just government and and that differential from thirty four down eighteen is hundreds of billions of dollars are the thoughts about how we can look at our health care system the way to get more dollars going it actually providing services to patients and less in the administrative component what we're doing and finally the notion proffered by a lot of people is that if we can actually achieve some form of universal access it actually represents a cost saving star country and i just want to throw those three items out use more transformational thinking about what can we do to get a handle on this cost situation we haven't from a public arena how should we be looking at this i could not agree more with my friend from utah on virtually every point you raised we are surrounded by economic systems i have a credit card i got from a bank you have a different bank but they still use the same system to optimize the value we get i have a cell phone you have a cell phone we buy from different vendors but they work together it's an economic system i fly on airlines it's a different airline than you do but they use the same system there is a system an economic system in all of those sectors of our economy there is no system of health care in the united states what we have is a sector that is without that there's a form of a system that connects it has to be electronically connected have to be quality standards that can measure it we've got to figure out what the cost is so people can know it and compare it and then we can begin to deploy incentives when we do people will begin to drive value up by having better better control of costs i could not agree more and i would look forward to working with you and other members of this committee to drive that home life that i think we need to get away from a lot of the parson rhetoric that dominates this issue because i think there's some practical ideas out there that we can work on and i look forward to doing that with you thanks so much thank you so much last but mr green from texas for four minutes thank you madam chairman and again welcome niamh the last one because i just came in this morning from houston who's we did a pay for college workshop last night we've done for a number of years in our district and it really works i have two quick questions one the that the president proposes savers i mean if you're running any program you would expect that the secretary and i would periodically say it just doesn't make any sense that we pay that way or that we do it this way we're proposing a group of actions that we think are just good management decisions ok my concern is that texas is one of the states that we utilize you know government transfers for our safety net and i've gotten letters over the last few years saying that what texas says is compared to other states there's no problem with using this for the safety net to utilize it without knowing effects of regulations on the states are you prepared to offer states in your share in such a critical medical services relied on by medicaid and uninsured patients will continue  if we're using the you know again i g t that there have been okayed in the past there's nothing inherently wrong about an intergovernmental transfer unless it's taking federal money relating it and using it as the match for federal money that doesn't work for us nor should it for any taxpayer what we want is a program based on a partnership with the state where both partners are putting up real money  ok again i think we get to try to deal with that through our committee process before next question as you know the president shared many of the members committee commitment expanded the reach of our community health centers and i'm glad mr schippers brought it up and i work closely with our if you a and my own area and see firsthand the quality they have i noticed the president's budget has a two hundred twenty four million increase now the c r that the house passed last week was a two hundred six million now is it the intent to have two twenty four on top of that two hundred six for the current year so every two twenty four for the next year mr green i'm going to confess to you that all of these different things we're trying to compare to just confused but i will tell you that we do intend to meet the president's objective of having twelve hundred and the actual number we're going to have to reconcile with somebody who's got all four of those budgets in front of them ok i mean obviously i'd be happy about that if we could get the two zero six through the senate and they get to twenty four and the follow up on that on the problem on the program of the high poverty counties initiative i represent harris county in houston texas and you were there during katrina and you saw that our infrastructure is not what it is in other states and you're been areas my concern about going to only certain counties we have so programs how would be that in counties that are under served very urban counties like houston here is county texas that will be able to to deal with again we have eight hundred thousand uninsured americans living in our county today and these these are really the only method we have to bring those folks in i have been aware of the increase in community health centers in your area actually i was there for