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[Senate Hearing 113-834]
[From the U.S. Government Publishing Office]

                                                        S. Hrg. 113-834

  NOMINATION OF THE SECRETARY OF HEALTH AND HUMAN SERVICES-DESIGNATE, 
                         SYLVIA MATHEWS BURWELL

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

                                HEARING

                                 OF THE

                    COMMITTEE ON HEALTH, EDUCATION,
                          LABOR, AND PENSIONS

                          UNITED STATES SENATE

                    ONE HUNDRED THIRTEENTH CONGRESS

                             SECOND SESSION

                                   ON

 NOMINATION OF SYLVIA MATHEWS BURWELL AS SECRETARY OF HEALTH AND HUMAN 
                           SERVICES-DESIGNATE

                               __________

                              MAY 8, 2014

                               __________

 Printed for the use of the Committee on Health, Education, Labor, and 
                                Pensions

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          COMMITTEE ON HEALTH, EDUCATION, LABOR, AND PENSIONS

                       TOM HARKIN, Iowa, Chairman

BARBARA A. MIKULSKI, Maryland        LAMAR ALEXANDER, Tennessee
PATTY MURRAY, Washington             MICHAEL B. ENZI, Wyoming
BERNARD SANDERS (I), Vermont         RICHARD BURR, North Carolina
ROBERT P. CASEY, JR., Pennsylvania   JOHNNY ISAKSON, Georgia
KAY R. HAGAN, North Carolina         RAND PAUL, Kentucky
AL FRANKEN, Minnesota                ORRIN G. HATCH, Utah
MICHAEL F. BENNET, Colorado          PAT ROBERTS, Kansas
SHELDON WHITEHOUSE, Rhode Island     LISA MURKOWSKI, Alaska
TAMMY BALDWIN, Wisconsin             MARK KIRK, Illinois
CHRISTOPHER S. MURPHY, Connecticut   TIM SCOTT, South Carolina   
ELIZABETH WARREN, Massachusetts        

                      Derek Miller, Staff Director
        Lauren McFerran, Deputy Staff Director and Chief Counsel
               David P. Cleary, Republican Staff Director

                                  (ii)

  

                            C O N T E N T S

                               __________

                               STATEMENTS

                         THURSDAY, MAY 8, 2014

                                                                   Page

                           Committee Members

Harkin, Hon. Tom, Chairman, Committee on Health, Education, 
  Labor, and Pensions, opening statement.........................     1
Alexander, Hon. Lamar, a U.S. Senator from the State of 
  Tennessee, opening statement...................................     3
Warren, Hon. Elizabeth, a U.S. Senator from the State of 
  Massachusetts..................................................    14
Isakson, Hon. Johnny, a U.S. Senator from the State of Georgia...    16
Mikulski, Hon. Barbara A., a U.S. Senator from the State of 
  Maryland.......................................................    18
Roberts, Hon. Pat, a U.S. Senator from the State of Kansas.......    19
Bennet, Hon. Michael F., a U.S. Senator from the State of 
  Colorado.......................................................    21
Enzi, Hon. Michael B., a U.S. Senator from the State of Wyoming..    23
Murphy, Hon. Christopher, a U.S. Senator from the State of 
  Connecticut....................................................    25
Murkowski, Hon. Lisa, a U.S. Senator from the State of Alaska....    27
Baldwin, Hon. Tammy, a U.S. Senator from the State of Wisconsin..    28
Burr, Hon. Richard, a U.S. Senator from the State of North 
  Carolina.......................................................    30
Casey, Hon. Robert P., Jr., a U.S. Senator from the State of 
  Pennsylvania...................................................    32
Hagan, Hon. Kay R., a U.S. Senator from the State of North 
  Carolina.......................................................    33
Whitehouse, Hon. Sheldon, a U.S. Senator from the State of Rhode 
  Island.........................................................    36
Murray, Hon. Patty, a U.S. Senator from the State of Washington..    38
    Prepared statement...........................................    39
Sanders, Hon. Bernard, a U.S. Senator from the State of Vermont..    41
Scott, Hon. Tim, a U.S. Senator from the State of South Carolina.    43

                             Guest Senators

McCain, Hon. John, a U.S. Senator from the State of Arizona......     5
Manchin, Hon. Joe, III, a U.S. Senator from the State of West 
  Virginia.......................................................     6

                                Witness

Burwell, Sylvia Mathews, A.B., B.A., Director, Office of 
  Management and Budget (OMB), Secretary of Health and Services-
  Designate, Washington, DC......................................     8
    Prepared statement...........................................     9

                                 (iii)

                                 
                          ADDITIONAL MATERIAL

Statements, articles, publications, letters, etc.:
    Mary Kay Henry, Service Employees International Union (SEIU), 
      president..................................................    47
    America's Health Insurance Plans (AHIP)......................    47
    American Public Health Association (APHA)....................    48
    Nursing Organizations........................................    48
    GAO Recorded Data on Premiums in Alaska in 2013 (compared to 
      2014)......................................................    50

Response by Sylvia Mathews Burwell to questions of:
    Senator Casey................................................    51
    Senator Hagan................................................    52
    Senator Franken..............................................    52
    Senator Warren...............................................    56
    Senator Baldwin..............................................    58
    Senator Bennet...............................................    59
    Senator Murphy...............................................    60
    Senator Alexander............................................    61
    Senator Enzi.................................................    84
    Senator Isakson..............................................    86
    Senator Kirk.................................................    95
    Senator Murkowski............................................    97
    Senator Burr.................................................    98
    Senator Hatch................................................   101
 
                     NOMINATION OF THE SECRETARY OF
                  HEALTH AND HUMAN SERVICES-DESIGNATE,
                         SYLVIA MATHEWS BURWELL

                              ----------                              

                         THURSDAY, MAY 8, 2014

                                       U.S. Senate,
       Committee on Health, Education, Labor, and Pensions,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 9:33 a.m. in room 
SD-106, Dirksen Senate Office Building, Hon. Tom Harkin, 
chairman of the committee, presiding.
    Present: Senators Harkin, Alexander, Mikulski, Murray, 
Sanders, Casey, Hagan, Bennet, Whitehouse, Baldwin, Murphy, 
Warren, Enzi, Burr, Isakson, Roberts, Murkowski, and Scott.
    Also present: Senators McCain and Manchin.

                  Opening Statement of Senator Harkin

    The Chairman. The committee on Health, Education, Labor, 
and Pensions will please come to order.
    We have convened this hearing to consider the nomination of 
Sylvia Mathews Burwell to be the next Secretary of the 
Department of Health and Human Services. Ms. Burwell, we thank 
you for joining us today, and for your prior services, and for 
being willing to take on this enormous responsibility.
    Ms. Burwell is currently serving as Director of the Office 
of Management and Budget, a position to which she was confirmed 
by a vote of 96-0 in April 2013. Ms. Burwell has proven herself 
as an effective and dynamic manager, with experience and skill 
in leading a wide range of organizations.
    Recently, I had a very productive meeting with Ms. Burwell, 
and concluded that she is an impressive nominee, and is 
eminently qualified to serve as the next Secretary of Health 
and Human Services.
    The United States faces serious public health challenges, 
many of which require urgent answers. Very often, the entire 
world looks to HHS for leadership. Just last Friday, the 
country confronted the first-ever incident of MERS, the Middle 
East Respiratory Syndrome, within our borders. HHS responded 
quickly to educate the public, investigate the situation, and 
develop a path forward; basically through the Center for 
Disease Control and Prevention. I might just add 
parenthetically, the CDC, the gold standard for public health 
in the world, I was just reminded the other day that China has 
named its public health system China CDC.
    We will count on our next Secretary for exactly that kind 
of informed, decisive action in the face of future challenges 
and crises, and to provide a steady hand overseeing an 
incredible range of activities across the Department.
    For example, she will be responsible for research efforts 
at the National Institutes of Health, among other agencies. 
This federally sponsored research has made the United States 
the world leader in biomedical innovation, and has resulted in 
countless discoveries and breakthroughs, from the extraordinary 
application of genomics, to cutting-edge pharmaceuticals, to an 
unprecedented understanding of the human brain.
    Ms. Burwell also will be in charge of another long-time 
priority, at least of mine, and that is disease prevention. She 
will lead our Nation's efforts to transform our healthcare 
system from a ``sick care system'' into one that focuses on 
wellness and prevention, and not just at the doctor's office 
but in our schools, our workplaces, and our communities.
    Ms. Burwell will oversee the Food and Drug Administration, 
a critically important agency that protects and promotes public 
health by keeping our Nation's food and medical product supply 
safe, among other things. In fact, FDA now oversees items 
accounting for 25 cents of every dollar spent by Americans.
    The Department also ensures that we can meet the healthcare 
needs of our most vulnerable citizens through programs like 
community health centers, Ryan White HIV programs, and the Head 
Start program.
    The Secretary is also charged with oversight of programs 
that support millions of Americans with disabilities. Medicaid 
makes it possible for many with chronic disabilities to remain 
in their homes, or to go to work or school, to be active 
members of society. In tandem, the Administration for Community 
Living implements policies that help people with disabilities 
to stay in their homes, to stay in their neighborhoods and 
places of work, with the result that people with disabilities 
in America are healthier, happier, and have a better quality of 
life.
    And of course Ms. Burwell will have the critical role of 
overseeing implementation of the Affordable Care Act. We can be 
proud that, thanks to the Affordable Care Act, we have seen 4.8 
million new Medicaid enrollees, more than 8 million more 
Americans have signed up for health insurance in the 
marketplaces. But there is more work to be done to continue 
successfully implementing the law and reforming our healthcare 
system; as I said, to move from a sick care system to a true 
healthcare system.
    The list goes on and on, but I think I have made my point 
that, as Secretary, Ms. Burwell will shoulder incredibly 
important responsibilities that matter deeply to the health and 
the wellness of the American people. And I believe this has an 
impact on our present and future economic strength as a Nation.
    We look forward to hearing from Ms. Burwell today about her 
vision and priorities for the Department of Health and Human 
Services. We welcome this opportunity to question her about 
many of the issues that this committee will continue to oversee 
going forward.
    I also wanted to mention that Senator Franken, a member of 
this committee, very much wanted to be here, but is attending 
the funeral of former Congressman Jim Oberstar today.
    And with that, I will ask our Ranking Member, Senator 
Alexander, for his opening statement.

                 Opening Statement of Senator Alexander

    Senator Alexander. Thanks, Mr. Chairman.
    Ms. Burwell, welcome. Glad to have you here. Since I will 
have the opportunity to ask questions later, let me use my 5 
minutes to tell you a story.
    When I was a boy, my grandfather was a railroad engineer in 
Newton, KS. He drove big, steam locomotives, switch engines. He 
would drive an engine onto the roundtable that was headed to 
Santa Fe and turn it, and head it in the direction it ought to 
be going. He would head it to Denver or he would head it to 
Houston.
    That is what Republicans would like to do with our 
healthcare system. We would like to turn it and head it in the 
right direction. We want to repair the damage that Obamacare 
has done and prevent future damage as responsibly and rapidly 
as we can. We would like to move in a different direction, to 
put in place proposals that would increase freedom, increase 
choices, and lower costs. We trust Americans to make these 
decisions ourselves. We believe that is the American way.
    Four years ago, Congress and the President made, what we 
believe, is an historic mistake. They passed a 2,700-page bill. 
We said,

          ``We do not believe in that, trying to rewrite the 
        whole healthcare system. Let us go step by step, in a 
        different direction; more freedom, more choices, lower 
        costs.''

    Let me take you back, for a moment, to the Healthcare 
Summit at the Blair House 4 years ago; 3 dozen Members of 
Congress, 6 hours with the President there, all of it on 
national TV. I was asked to speak first for the Republicans. I 
said what was wrong with the President's plan. I, and others, 
said it would increase healthcare costs, and it has.
    ``USA Today'' reported that healthcare spending the first 
quarter of the year, rose at the fastest pace in nearly 35 
years. ``The Hill'' paper reported that insurance executives 
say premiums and new exchanges will double or triple in the 
country next year even with subsidies. Many Americans are 
finding that the co-payments and the out-of-pocket expenses are 
so high, they cannot afford insurance.
    We said people would lose their choice of doctors; and many 
have. We said Obamacare would cancel policies; and it has. At 
least 2.6 million Americans have had their individual plans 
outlawed by Obamacare and millions more of Americans who get 
their care through small businesses will find the same thing 
happening to them.
    We said it would lose jobs, it would cause jobs to be lost; 
it has. The President of Costa Rica is hosting job fairs 
welcoming medical device companies that have been driven out of 
the United States by the onerous 2.3 percent tax on revenues.
    We said Medicare beneficiaries would be hurt; they have. 
The average cut per Medicare Advantage recipient will be $317 
between this year and next.
    We said the only bipartisan thing about the bill will be 
its opposition; Gallup says that level today is 54 percent. I 
said that every Senator who voted for it ought to be sentenced 
to go home and serve as Governor, and try to implement it, and 
there are 16 Governors today who will not implement the 
Medicaid expansion because they worry about costs.
    But the most important thing we said was what we would do 
if we could. We said, ``Let us go step by step in a different 
direction.'' Our democratic friends said, ``That is not a plan. 
That is not comprehensive.'' We said,

          ``You are right. Washington is not wise enough to 
        make these decisions to rewrite 20 percent of the 
        economy. If you are waiting for Senator McConnell to 
        wheel in a wheelbarrow with a 2,700-page bill, you are 
        going to be waiting until the moon is blue.''

    And at the Summit, we outlined our steps.
    For example, we said, ``If you like your plan, you can keep 
it,'' as the President did, and we suggested removing some 
mandates to make that possible. We said,

          ``If you find a policy in another State that fits 
        your budget and your healthcare needs, you can buy it. 
        If you are a small employer, you can combine your 
        purchasing power with other small employers to offer 
        employees lower-cost insurance.''

    We would allow any American to buy a major policy to avoid 
a medical catastrophe, and then have an expanded health savings 
account to complement that. If you are an employer, we would 
make it easier for you to give your employees rewards for 
leading a healthy lifestyle.
    Ms. Burwell, you have a reputation for competence, and I 
would respectfully suggest you are going to need it, because if 
you are confirmed, you, by yourself, supervise the spending of 
nearly $1 trillion a year, which is as much as the entire 
Congress of 535 men and women appropriate every year.
    We hope, on this side of the aisle in the next congress, we 
have a Republican majority in the Senate, and we will be able 
to do, for our healthcare delivery system, what my grandfather 
used to do in Newton, KS for those trains that were heading 
west. We would like to head them in a different direction.
    As I said, Republicans would like to repair the damage that 
Obamacare has done. We would like to prevent future damage, as 
responsibly and rapidly as we can. We want to move in a 
different direction to put in place proposals that provide more 
freedom, more choices, and lower costs.
    We trust Americans to make those decisions for ourselves. 
We believe that is the American way. Since Obama will still be 
in office for the next 2 years, if you are confirmed, we will 
need your help to do that.
    Thank you.
    The Chairman. Thank you very much, Senator Alexander.
    Before I introduce Ms. Burwell, we will call upon two 
distinguished Senators who are here in order, of course, of 
seniority.
    I would first recognize our friend and our colleague, 
Senator McCain.
    Senator McCain, welcome.

                      Statement of Senator McCain

    Senator McCain. Thank you very much, Senator Harkin, and I 
hope that Senator Manchin appreciates that more than he does 
today. I thank you, Mr. Chairman, for allowing me to be here.
    Many of us in this room, as Senator Alexander just pointed 
out, disagree about the merits of Obamacare, and what the path 
forward should be to reform our healthcare system. I, along 
with others, fought for 25 days on the floor of the Senate 
against Obamacare or the Affordable Care Act. The First 
Amendment was one that I raised to stop the nearly $500 billion 
in cuts in Medicare that was in the bill, and I continue to 
believe that the Affordable Care Act should be replaced and 
modified.
    But not withstanding that disagreement, I am pleased to 
introduce Sylvia Burwell, who has been nominated, obviously, as 
Secretary of the Department of Health and Human Services. Her 
previous experience as Deputy Director of the Office of 
Management and Budget during the Clinton administration, as 
well as her work with the Bill and Melinda Gates Foundation, 
the Walmart Foundation, her current work as Director of OMB, 
and I have no one who does not have but the highest praise for 
her work as Director of OMB, make her well-qualified to be 
Secretary of HHS.
    I would like to add that I visited, Mr. Chairman, 
Bentonville, AR while Secretary Burwell was there. I was 
briefed by her. I would recommend to every one of my colleagues 
a trip to Bentonville, AR to see an incredible American success 
story from one store in a small town to the world's largest 
retailer. Ms. Burwell was part of that team that maintains the 
predominance of Walmart as the No. 1 retailer in the world 
today. To say I was impressed would be an understatement.
    Last year, Sylvia's stewardship of the Walmart Foundation--
which made in 1 year, last year, $1.3 billion in charitable 
donations--she was the steward of that and won nothing but the 
highest praise for her activities in that capacity.
    And regardless of my objections to the Affordable Care Act, 
the Department of Health and Human Services needs competent 
leadership in the position of Secretary. I believe Ms. Burwell 
has the qualifications to run HHS, and have assured that she 
will work with Members of Congress, as she has as Director of 
OMB, and be more responsive to its members than her 
predecessor.
    When Sylvia was nominated to be Director of the OMB, I said 
that position of Director of OMB is perhaps the toughest job in 
Washington. The position for which she is currently nominated 
is, perhaps, the most thankless. That is why I advised her 
against taking the leadership position at HHS. After all, who 
would recommend their friend take over as Captain of the 
Titanic after it hit the iceberg? Obviously, she ignored my 
advice and accepted the nomination anyway, continuing her 
pattern of public service.
    And you know the scope of her responsibilities are far in 
excess just of HHS: Medicare and Medicaid services, the Food 
and Drug Administration, Indian Health Service, the National 
Institutes of Health, among several other divisions add up to a 
trillion-dollar budget with 80,000 employees. She will have her 
work cut out for her.
    I recommend strongly, Ms. Burwell, and hope the committee 
will endorse her nomination.
    I thank you, Mr. Chairman.
    The Chairman. Thank you very much, Senator McCain for being 
here. And I know you have a busy schedule. If you need to 
leave, please feel free to, but thank you. Thanks for being 
here. Appreciate it very much, Senator McCain.
    And now, we will turn to Senator Manchin, who probably has 
some good words to say about a person from Hinton, WVA.
    Senator Manchin, welcome.

                      Statement of Senator Manchin

    Senator Manchin. Thank you, Mr. Chairman, and thank you, 
Senator Alexander, and all of our colleagues here.
    Let me just say that I, first of all, Senator Rockefeller 
wanted to be here and he was unable this morning, and I am just 
so thankful and honored to be able to sit here in his behalf, 
and on my own behalf, and for all of the people in West 
Virginia that are so proud.
    I want to put a little bit of a personal touch because 
Sylvia comes from where most of us come from. When you talked 
about the railroad, Senator Alexander, she comes from a 
railroad town, so she knows about turning that engine. She 
knows about basically that roundhouse. That is where she comes 
from. And this is a lady that has done it, she knows how to do 
it, and she has watched it.
    We are all a product of our environment, every one of us, 
and you really flow back to where we came from, how we were 
raised, the families we were raised with, the communities that 
nurtured us. Hinton, WVA is a special little place. It is in 
Summers County. It is the most beautiful place. It is right 
along the New River. The big Bluestone Dam is right there in 
her backyard, and people fish, and they actually enjoy the 
recreation and all that.
    Sylvia's father, Dr. William Mathews, is a town 
optometrist, well respected. He is a first generation Greek 
immigrant, came with the hardworking ethics that we come from 
and people wanting the American dream, and her grandparents 
were seeking that.
    Her mother, the Hon. Cleo Mathews, is a very dear friend of 
mine. When I say ``the honorable,'' and I mean that in every 
sense of the word, she was the mayor of Hinton; tough. Senator 
Mikulski, you and Cleo would get along absolutely to a tee. 
When I was Governor, I never had anyone--I enjoyed those 
conversations, the phone calls from her mother, letting me know 
what I was doing wrong and how I could fix the State, and I 
took most of those to heart. Her mother was a math teacher, a 
most respected math teacher. So everything you see in this 
young lady is because of her environment, it is how she was 
raised.
    She is grounded. Still calls every week back to her 
friends, two of her closest friends she grew up with from first 
grade on and stays in touch. She is a Rhodes Scholar. I do not 
think any of us would question her ability and also her 
performance as a public servant. Just think what she could do 
in the private sector if basically fortunes were her driving 
goal where she could be today. It has never been that. I think 
that every time we have had a chance, we have overwhelmingly 
nominated her, unanimous the last time in one of the toughest 
positions.
    We are not here, and I am not here, to change anyone's mind 
on what they believe about the Affordable Healthcare Act or 
Obamacare, as you will. That is not what we are here to do. We 
are here to get the most responsible, the most talented person 
that can lead us. And Senator, I think you said it well, we can 
get that train moving in the right direction who can sit down 
and listen to each one of us. We all have concerns. We all want 
to see it better. We want our fellow Americans to have good, 
quality healthcare and access to it. We want to make sure that 
it is workable and we can, and it is affordable, and we do not 
have a person that understands numbers better than Sylvia, a 
person that has more experience than Sylvia and more compassion 
for America than Sylvia because she has proven it. And what she 
has given up in the form of just monetary means, what seems to 
be driving everybody today to give back to public service, 
which was instilled in us.
    I am honored to be here. I am sorry that Senator 
Rockefeller couldn't be here, and I know he is too, but on 
behalf of every West Virginian, let me tell you, we are proud, 
we are proud, and she has served her country admirably, and 
made all of us proud, and made very American proud. I think she 
will do the same.
    So as you consider whether you like the healthcare and do 
not like the healthcare, I would hope that your vote would be 
based on who do you think is the most competent person that 
could take us through the most troubling, difficult, 
challenging times to make sure that we can deliver the services 
that Americans depend from all of us.
    With that, I am honored to be here with her. She is a dear 
friend. Her mother is watching right now. And I hope I said all 
the right words, and I hope, Dr. Mathews, you are as proud as I 
am. Thank you. I recommend her wholeheartedly.
    The Chairman. I gather that. Senator Manchin, thank you 
very much for that strong endorsement, for being here. I know 
you also have a busy schedule, and you are certainly excused if 
you so desire. Thank you, Senator Manchin.
    A lot has been said about your past, but I think it bears 
repeating for the record. Sylvia Mathews Burwell, presently 
Director of the Office of Management and Budget, confirmed by 
the Senate on April 24, 2013 unanimously.
    Ms. Burwell previously served as president of the Walmart 
Foundation. Before that, she was president of the Global 
Development Program of the Bill and Melinda Gates Foundation, 
where she worked for 10 years. She was also first Chief 
Operating Officer of that Foundation.
    During the Clinton administration, she served as Deputy 
Director of OMB, Deputy Chief of Staff to the President, Chief 
of Staff to the Secretary of the Treasury, and Staff Director 
of the National Economic Council.
    Before her Federal Government service, she worked for 
McKinsey & Company. Ms. Burwell served on the board of the 
Council on Foreign Relations and MetLife. She received her A.B. 
from Harvard University, a B.A. from Oxford University where 
she was a Rhodes Scholar. And has been said many times, hails 
from Hinton, WVA.
    Ms. Burwell, welcome. Thank you for your long career of 
public service. And your statement will be made a part of the 
record in its entirety.
    The floor is yours, and I know you have some family and 
friends here, and if you would like to introduce them, we would 
be more than receptive to recognize your family and your guests 
who are here.

  STATEMENT OF SYLVIA MATHEWS BURWELL, A.B., B.A., DIRECTOR, 
OFFICE OF MANAGEMENT AND BUDGET (OMB), SECRETARY OF HEALTH AND 
            HUMAN SERVICES-DESIGNATE, WASHINGTON, DC

    Ms. Burwell. Chairman Harkin, Ranking Member Alexander, and 
members of the committee.
    Thank you for inviting me here today. I am honored that 
President Obama has nominated me for Secretary of Health and 
Human Services, and it is a privilege to be considered by this 
committee.
    With me today is my sister, my brother-in-law, and two 
friends, as well as my husband Stephen.
    I want to thank Senator McCain and Senator Manchin for 
their kind worlds, and I am honored to be introduced by such 
extraordinary public servants.
    I am especially grateful for my husband Stephen and our 
children for their tremendous support. And while my parents 
cannot be with us here today, I also want to recognize them for 
instilling within me the enduring value of public service.
    As a second generation Greek immigrant, I was raised to be 
thankful for the tremendous opportunities that this great 
Nation provides, and to appreciate the responsibilities that 
come with them.
    Throughout my childhood in Hinton, WVA, my father, an 
optometrist and small businessman, and my mother, a teacher, 
set a great example for me and my sister through their 
engagement in service through our community and our church. It 
is that example that is an important part of why I sit here 
today.
    Whether in the public or private sector, working across a 
wide range of issues, I focus my work on three things: building 
strong relationships, building strong teams, and delivering 
results. In my role as OMB Director, I have worked closely with 
members of this committee and others to support efforts to 
return the budget process to regular order, and to drive toward 
progress on the issues we all care deeply about.
    If confirmed, I look forward to working alongside the 
remarkable men and women of the Department of Health and Human 
Services to build on their work to ensure children, families, 
and seniors have the building blocks of healthy and productive 
lives.
    These issues are fundamental to all of us, whether it is 
the chronic condition of a child we love, or the safety of the 
food we eat every day. So I respect and appreciate the 
importance of the challenges before us.
    As we meet here today, scientists and researchers at the 
NIH are working to find cures for some of the world's most 
serious diseases, and experts at the Centers for Disease 
Control and Prevention are working to prevent them from 
spreading. The Food and Drug Administration is protecting the 
food we eat and the medications our doctors prescribe for us.
    Our parents and our grandparents rely on the Centers for 
Medicaid and Medicare services, and millions of our children 
benefit from Head Start. Thanks to the Administration for 
Community Living, millions of Americans are living with dignity 
in their own communities.
    The Department's work to ensure accessible, affordable, 
quality healthcare through the implementation of the Affordable 
Care Act is making a difference in the lives of our families 
and our communities while strengthening the economy. Together, 
all of this work forms the foundation of a stronger middle 
class, a more prosperous economy, and healthier communities.
    Mr. Chairman, and members of the committee, thank you, 
again, for the invitation to speak today, and also thank you, 
because I have valued the conversations that I have had over 
the course of the past several weeks. I am hopeful that we will 
have the opportunity to continue to work together closely in 
the months ahead to deliver impact for the American people.
    And with that, I would be pleased to answer your questions.
    [The prepared statement of Ms. Burwell follows:]

        Prepared Statement of Sylvia Mathews Burwell, A.B., B.A.

    Chairman Harkin, Ranking Member Alexander, members of the 
committee, thank you for inviting me to discuss my nomination to be the 
Secretary of Health and Human Services. I am honored that President 
Obama has nominated me for this position, and it is a privilege to be 
considered by this committee.
    I want to thank the members of this committee and your staff for 
taking the time to meet with me over the course of the last few weeks 
and for continuing to share your views. If confirmed, I look forward to 
working together closely on our shared priorities for the Department of 
Health and Human Services.
    I am especially grateful for my husband and children for their 
tremendous support, especially as I seek to take on this new role. 
While my parents could not be here with us today, I also want to 
recognize them for instilling within me the enduring value of public 
service.
    As a second-generation Greek immigrant, I was raised to be thankful 
for the gifts that this great nation gave to me and to my parents 
before me. Throughout my childhood in Hinton, WVA, my father, an 
optometrist and small business owner, and my mother, a teacher, were 
both engaged in service through our community and church.
    And so, with this core commitment to service and passion for 
impact, I am humbled and excited by this next challenge. If confirmed, 
I look forward to working alongside the remarkable men and women of the 
Department to continue to ensure that children, families, and seniors 
have the building blocks of healthy and productive lives.
    These issues are fundamental to all of us--whether it is the 
chronic condition of a child we love, the safety of the food we eat 
every day, or improving quality, lowering cost and expanding access in 
our healthcare system--so I respect and appreciate the importance of 
the challenges before us. I am committed to an open dialog on 
priorities for the Department and our shared goal of delivering impact 
for the American people.
                          commitment to impact
    As the Director of the Office of Management and Budget, and 
throughout my career in both the public and private sectors, I have had 
the opportunity to lead large and complex organizations and work across 
a range of issues. In each of my roles, I have focused on building 
strong teams, forging relationships, and delivering results. As chief 
operating officer and later president for Global Development at the 
Gates Foundation, I had the opportunity to work on some of the world's 
most pressing challenges, from agricultural productivity to healthcare 
in the developing world. As president of the WalMart Foundation, I led 
our efforts to fight hunger in America, leveraging Walmart's presence 
in local communities to reach millions of people across the country to 
best maximize our impact. And as a member of the board at a university 
hospital and Fortune 50 insurance company, I gained firsthand 
experience into healthcare delivery and insurance markets--and how both 
can work better for businesses and families.
    In my role as OMB Director, I have worked closely with members of 
this committee and others--both Democrats and Republicans--to support 
efforts to return to a more orderly budget and appropriations process. 
The enactment of the Bipartisan Budget Act of 2013 and the Consolidated 
Appropriations Act of 2014 represented important steps toward replacing 
damaging sequestration cuts with sensible long-term reforms and 
investing in key areas of innovation, education, and infrastructure to 
help grow our economy, create jobs, and strengthen the middle class. 
Throughout my tenure, I have made responsiveness to and engagement with 
Congress a priority--working with members on both sides of the aisle to 
drive toward progress on the issues we all care deeply about.
        the work of the department of health and human services
    The Department of Health and Human Services touches Americans at 
every age, from every background, in every part of our country. As we 
meet here today, scientists and researchers at the National Institutes 
of Health are working to find cures for some of our world's most 
serious diseases--and experts at the Centers for Disease Control and 
Prevention are working to prevent them from spreading. The Food & Drug 
Administration is protecting the safety of the food we eat and the 
medications our doctors prescribe us. The Agency for Healthcare 
Research and Quality is researching ways to improve the care we receive 
and identify causes of racial and ethnic disparities in health so we 
can work to eliminate them. These talented men and women are not only 
among the best in their fields, they are among the best in the world.
    Our parents and grandparents rely on the Centers for Medicare & 
Medicaid Services, and millions of our children benefit from Head Start 
and the work of the Administration for Children & Families. Meanwhile, 
millions of Americans are living with dignity in their own communities, 
thanks to the Administration for Community Living.
    Throughout our country, one in five adults experiences mental 
illness. Our neighbors are supported by the behavioral health and 
substance use services provided by the Substance Abuse and Mental 
Health Services Administration. And the largest expansion of behavioral 
health coverage in a generation is finally delivering on parity between 
mental and physical health coverage.
    Tens of millions of people living in underserved communities--from 
rural America to Indian Country to America's inner cities--are 
accessing quality care, regardless of their ability to pay, thanks to 
the Heath Resources & Services Administration and the Indian Health 
Services.
    The Department's work to ensure accessible, affordable, quality 
healthcare through the implementation of the Affordable Care Act (ACA) 
is making a positive difference in the lives of our families and our 
communities, while strengthening the economy. Because of the law, 
millions of Americans now have new benefits, new protections, and new 
health coverage. The Congressional Budget Office recently affirmed that 
the ACA is working to lower healthcare cost growth, make individual 
market premiums affordable, increase coverage, and reduce the Federal 
deficit.
    Together, all this work forms the foundation of a stronger middle 
class, a more prosperous economy, and healthier communities.
                               conclusion
    If confirmed, I will work to continue to build on this progress. 
Understanding the complexity and significance of the challenges that 
lie ahead, I will approach my work at the Department with three guiding 
tenets--driving solutions for the issues we all care deeply about; 
building teams with the talent and focus we need to implement against 
our objectives; and strengthening relationships to make progress on the 
wide variety of issues at the Department that transcend parties, and 
will ultimately transcend our generation.
    Mr. Chairman and members of the committee, thank you again for the 
invitation to speak with you today. I have valued the conversations we 
have had to date, and I am hopeful that we will have the opportunity to 
continue to work together closely to engage on some of the most 
pressing issues this Nation faces today and to best support the health 
and wellness of the American people.
    With that, I would be pleased to answer your questions.

    The Chairman. Thank you very much, Ms. Burwell.
    We will start rounds now of 5 minute questions.
    Ms. Burwell, as I mentioned in my opening statement, I have 
long been focused on the critical importance of transforming 
what I have often called our sick care system into a healthcare 
system, one that does not just focus on repairing the damage, 
but prevents it in the first place, keeping people healthy.
    That is why I was proud to author the prevention title of 
the Affordable Care Act. Along with Senator Mikulski, we worked 
very closely on that together, the Prevention and Public Health 
Fund, a dedicated funding stream designed to promote prevention 
and make communities across America healthier. Investments from 
the Fund have supported a range of prevention initiatives, 
supporting critical obesity prevention programs, the incredibly 
successful Tips from a Former Smoker campaign, and many, many 
more. Of course, we know that these investments not only 
improve and save lives, they are also good for the Nation's 
fiscal health.
    Ms. Burwell, will you ensure that community-based 
prevention efforts are in the forefront of our Nation's health 
agenda, maximizing the impact of critical investments from the 
Prevention and Public Health Fund, and the health of the 
American people?
    Ms. Burwell. Senator, first, thank you for your leadership 
in this space, in the prevention space. In my current role, I 
have an opportunity to work with you on these issues as well.
    And the issue of prevention, I think, is an incredibly 
important one as we think about our overall healthcare system. 
And it is something that, I think, in the past has not received 
as much emphasis, and it is something that is both important to 
contributing to better health, but also better costs within the 
system.
    If I am confirmed, it is something that I think is very 
important. I think we want to work in the Federal system to 
promote prevention, and I think we also want to build on some 
of the efforts that are currently occurring in the private 
sector where companies are doing this type of work to, and they 
are measuring those results. I think there are things that we 
can use there that will help increase what we are doing in the 
public sector as well.
    The Chairman. Thank you.
    I appreciate your commitment to that and understanding that 
prevention is not just in the doctor's office. It is in 
schools. It is in communities. It is in workplaces. It is in 
every aspect of our life that we have to address that. And as 
the Secretary, you have the ability to reach in all those 
areas.
    Second, and sort of in keeping with that theme of 
prevention, last week, former FDA Commissioner Jane Henney, 
wrote an Op Ed highlighting the urgent need for action on the 
part of, ``The Government and the food industry to address the 
amount of salt in our food supply.'' Dr. Henney noted that it 
has been 44 years since the White House Conference on Food, 
Nutrition, and Health-issued recommendations highlighting the 
role of sodium in the development of hypertension, and it has 
been 4 years since the Institute of Medicine released its 
report recommending that the FDA use its regulatory authority 
to require industry to lower the sodium content in our Nation's 
food supply over time. And yet, despite the fact that upwards 
of 100,000 lives could be saved annually if sodium levels in 
packaged and restaurant foods were cut in half, inaction 
continues.
    In the same article, Dr. Henney points to your nomination 
as an opportunity to, ``Reset on this critical public health 
issue,'' and I certainly hope she is right.
    Given the extraordinary public health potential, how will 
you work and will you commit to work to turn the tide on this 
issue of sodium reduction?
    Ms. Burwell. Senator, the issue of sodium reduction and the 
broader issues of things that we consume and how that affects 
our health, when we think about those issues, and if I am 
confirmed, I think there are two things in thinking about them 
as a priority.
    The first is making sure that people have the right 
information. Having been a part of a very large grocer in my 
last role, that is something that when one works on nutrition 
issues and healthy eating, which was something during my time 
at Walmart, the ``great for you'' label was introduced and is 
on products that tell people. And so, one is about the 
information; people knowing what works and does not work in an 
easy way.
    When you are in the grocery store where people are buying 
and purchasing, the average time is very limited. People are 
working. They are going home. They are on their way home and 
doing it. So providing the right information is one thing, and 
I think it is an important part, and then providing access and 
tools because for some people, the issue of healthy food, it is 
an issue of access.
    In thinking about those issues, I think it is an important 
priority, the issue of sodium. If confirmed, I want to 
understand more deeply what has been going on and what has not 
been going on. But those are two broad principles, as you think 
about this broader issue of what we eat and what we consume, 
that are things that guide the way I think about that.
    The Chairman. I appreciate that. Information is important, 
but it is also important for the FDA to issue regulations, as 
they have in the past on food, and the contents of food, and 
trans fat, and everything else. But we have not yet done 
anything really on sodium.
    And so, I hope that through your agency and the Food and 
Drug Administration, that it will take a look at that too.
    Ms. Burwell. Thank you.
    The Chairman. Thank you.
    Senator Alexander.
    Senator Alexander. Thank you, Mr. Chairman.
    Ms. Burwell, in my remarks, I talked about some proposals 
that Republicans have to move our healthcare delivery system in 
a different direction, one that more emphasizes choice, 
freedom, and hopefully, lower costs for Americans as they buy 
health insurance plans. Let us talk about a few examples.
    For example, Obamacare outlawed about 5 million individual 
healthcare plans. The Administration reacted by saying, ``If 
you like your plan, you can keep it for a year,'' giving States 
that option. Then, I believe they said, ``Now for 2 more 
years,'' and that has cut about in half the number of people 
who had their plans outlawed.
    Would you be willing to extend that option further to give 
States a chance to allow people to keep the plans that they 
had?
    Ms. Burwell. Senator, when I think about the implementation 
of the Affordable Care Act, there are three fundamental anchors 
that I think about.
    One is the issue of accessibility, the other is the issue 
of affordability, and the final is----
    Senator Alexander. Ms. Burwell, I only have 5 minutes, and 
so, what about an answer to the question?
    Would you extend the 3 years that you now allow States to 
have to help people keep the plans that they want to keep?
    Ms. Burwell. Why I was mentioning the three goals is 
because I think any actions that are taken, one should do in 
the context of implementing against those core goals.
    Right now, the changes that have been put in place are 
changes that are part of a transition period as people are 
transitioning to a point where we can implement a system, and 
as the system where pre-existing conditions are covered, where 
women and gender issues cannot be discriminated against----
    Senator Alexander. Is that a no or a yes, or are you just 
not prepared to say at this point?
    Ms. Burwell. Senator, at this point, I think we want to see 
what is happening with regard to the issues of implementation.
    Senator Alexander. Let us take another example, buying 
across State lines.
    There is a young woman from Tennessee named Emily who came 
to see me. She had a plan that cost her $53 a month that 
Tennessee had created. It was outlawed by Obamacare. She went 
on the exchange and even with a subsidy, she is now paying 
$450. It has limited benefits, but it fits her healthcare needs 
and it fits her budget.
    If Kentucky had such a plan, even though she lived in 
Tennessee, why not give her the choice of buying that Kentucky 
plan? Would you favor that?
    Ms. Burwell. Senator, if I am confirmed, that is something 
I want to look into and understand.
    When one looks into that question, I think what you have to 
consider, can the markets work in each of the States. And so, 
when you go across States, can you still keep a system up and 
working and care being provided?
    Senator Alexander. I was thinking more about more choices 
for Emily so she could buy a plan that costs $50 or $60 or $70 
a month instead of $400 a month.
    Or here is another idea, former Secretary Shultz has 
suggested that Obamacare allows, I believe, Americans under 30 
to buy what we call a major medical plan to avoid the financial 
catastrophes. You can sleep at night knowing you will not go 
bankrupt if you have a major problem.
    Why not let any American buy a major medical plan against 
the financial catastrophe and combine that with expanded health 
savings accounts? That would give every American more choices 
and more opportunity to buy plans that fit their budget and fit 
their healthcare needs.
    Ms. Burwell. I think the issue of quality healthcare plans 
is an important part of the Affordable Care Act. That there are 
certain things that should be part of basic health and that is 
part of creating a system that will work.
    And one of the things that I think is a challenge is making 
sure that all the pieces fit together so you do, do the things 
that, in your opening comments, you talked about with regard to 
both cost and access.
    Senator Alexander. But one of the major reasons Emily is 
paying so much more for her policy is because Washington is 
deciding for her what she can afford and what she needs, and 
what I would like to do is give her more choices.
    What about, I am a former Governor, what about giving 
States more flexibility with Medicaid? When I was Governor, it 
was 8 percent of the State budget; today it is 30 and 15 
Governors will not even expand Medicaid.
    Why not trust States to give individuals more choices like 
the Cover Tenn plan that Emily had, the lady? Why not expand 
that flexibility as a way of giving more choices and lowering 
costs?
    Ms. Burwell. When the question of how one works with 
States, and if I were confirmed, the issue of how CMS does work 
with States, there have been a number of examples where 
flexibility has been granted, whether that is Arkansas or other 
examples.
    I think flexibility is important. I think principles are 
important. And where you meet in that space of having enough 
standardization that meets the principles, but flexibility to 
meet the varying needs of States is something that I think is 
important in how I would think about that.
    Senator Alexander. In my last 5 seconds, this comment.
    We had a conversation last week about getting answers from 
your Department to reasonable questions about the 
implementation of the Affordable Care Act. I mean, if it is 
good for McDonald's to advertise how many hamburgers it sells, 
I would think it would be good for the Department to advertise 
who is buying the premiums, whether they had insurance, and we 
certainly need to know that ourselves in the Congress.
    So I would simply ask you to focus on answering the 
questions that Members of Congress ask you as we go forward.
    Thank you, Mr. Chairman.
    The Chairman. Thank you, Senator Alexander.
    I have in order, then it would be Senator Warren, Senator 
Isakson, Senator Mikulski, Senator Roberts, Senator Bennet, 
Senator Enzi, then Senators Murphy, Baldwin, Casey, and 
Sanders.
    I will recognize Senator Warren.

                      Statement of Senator Warren

    Senator Warren. Thank you Chairman Harkin, and thank you, 
Ms. Burwell, for being here today.
    Ms. Burwell, there seems to be broad bipartisan agreement 
that we need to reduce Federal healthcare spending. And 
Republicans argue that to accomplish this, we need entitlement 
reform. But they should not forget that we passed major 
entitlement reform just 4 years ago as part of the Affordable 
Care Act and that it is already working to reduce Medicare 
spending. So I just had a couple of numbers to look at.
    In 2009, before Obamacare, the Medicare trust fund was 
projected to go bankrupt in 2017. Today, the Medicare trust 
fund is solvent at least until 2026. Moreover, every 
Congressional Budget Office estimate of Medicare spending since 
the ACA was passed has continued to show bigger savings--that 
is bigger, not smaller--savings than the report before.
    In fact last month, the CBO projected that Medicare 
spending for 2014 to 2020 will be $500 billion less than they 
originally projected after the bill was passed. And to put that 
in perspective, that is a cut in Federal spending which is 6 
times bigger than all of last year's idiotic sequester cuts, 
which slashed vital funds to basic scientific research, to Head 
Start, to Meals on Wheels, and the Republicans want to repeal 
it.
    So, Ms. Burwell, my question is we know that reductions in 
Medicare costs are the result of many different factors, but as 
an expert in Federal budgeting, do you think it is fair to say 
that an important factor in the efficiencies created by the 
Affordable Care Act has resulted in these reductions in costs 
in Medicare?
    Ms. Burwell. Yes, I do.
    I think specifically when one looks at the CBO numbers, 
what one sees for the period of 2014 to 2020--which is the 
period since the Affordable Care Act was passed, because that 
was the window that CBO has scored--healthcare costs for the 
Federal Government have decreased by $900 billion over that 
period, and I think that is an important contribution to the 
issue of--hopefully those are changes that do two things: 
reduce cost and maintain quality, and hopefully in some cases, 
even improve quality.
    So the implementation already of the changes of the 
Affordable Care Act are reducing the deficit and providing 
great savings.
    The only thing I would also add is the current budget 
proposal that is before the Congress right now from the 
President, the actuaries say that that proposal will extend the 
life of the trust an additional 5 years. There are choices and 
changes that would be a part that have been proposed by the 
Administration, but that builds on a number that you already 
articulated: the 2017 to 2026.
    Senator Warren. Thank you. I think that is really 
important.
    Actually, I wanted to ask you another question about 
building on the successes of the Affordable Care Act, and that 
is that the ACA established the Center for Medicare and 
Medicaid Innovation to test new payment and delivery models 
that encourage coordinated care, such as bundled payments.
    BayState Health in western Massachusetts is part of a 
bundled payment demonstration project, and their private 
healthcare system has successfully used this model for years. 
By bundling payments for hip and knee replacement, for example, 
BayState Health reduced the cost of treatment by over $2,000 
per patient while also reducing hospital re-admissions and 
complications. It is not an isolated case. CBO projects that 
applying bundled payment models like Baystate's nationally 
could save Medicare about $46.6 billion over the next 7 years.
    The Affordable Care Act gave the Secretary of HHS the 
authority to expand successful demonstrations to a wider range 
of healthcare providers so that we can cut costs without 
compromising care or improve care at the same cost.
    And I just want to ask about your strategic plan for using 
your statutory authority to expand these efforts where the data 
demonstrates that we can get better outcomes and lower costs.
    Ms. Burwell. With regard to my philosophy, and I think it 
is important to have things be data-based, having had the 
opportunity to do grant making in my other roles where one sees 
and creates models.
    What I think you want to do is to find the models there. I 
think conditions with regard to which are the most successful 
and then which are the most likely to scale, because that is 
what we need across the Nation, and you have to consider both 
questions when considering what you would scale. Because what 
you want to do is get the largest impact you can. That impact 
is a combination of both what the measures are of success, but 
it is also your ability to make it go broadly across the 
Nation, and that is how I think about that.
    Senator Warren. Thank you. The Affordable Care Act gave us 
tools to help reduce the cost of healthcare and improve 
outcomes, and I am glad to hear that you plan to use them.
    Thank you, Mr. Chairman.
    The Chairman. Thank you, Senator.
    Senator Isakson.

                      Statement of Senator Isakson

    Senator Isakson. Ms. Burwell, good morning.
    Ms. Burwell. Good morning.
    Senator Isakson. As you know from our conversations the 
last couple of days, there is no challenge that I have before 
me as U.S. Senator more important, including your confirmation, 
than getting the Savannah Harbor Expansion Project done in my 
State.
    Senator Chambliss and I have worked for 16 years, along 
with various members of the House from Georgia, to go through 
all the steps at NOAA, EPA, OMB, Corps of Engineers, Fish and 
Wildlife, to get every approval we could get, including getting 
the Vice President to join us on the docks in Savannah and make 
his famous quote that we were going to get it done come hell or 
high water.
    I am not one that kills the messenger, but on a Sunday 
night right before the budget came out, you delivered the news 
to Senator Chambliss and I that we were not going to be able to 
move forward based on a plan that we had thought, through 
conversations with others, not with you, that we had included 
the right language in the Omnibus Appropriation bill to move 
the Savannah Harbor Expansion program forward, and at the last 
minute, we got the bad news that was not going to be the case.
    In the last 2 days, you and I have had discussions about 
how important this is to my State and to my country because the 
Port of Savannah is not a parochial, Georgia issue. It is an 
issue for the entire trade of the United States of America and 
the economy of the United States of America. It is a net 
positive export Port. It has met every requirement needed 
whatsoever, and I do not want you leaving OMB until I know that 
we are going to be able to move forward with the Savannah 
Harbor Project, and I would like for you to respond to that 
question.
    Ms. Burwell. Senator, with regard to where we are in terms 
of legislation, and currently as we have discussed, I think 
that, first of all, the Port is an important effort. It is an 
effort that I agree with you is not just about Georgia, it is 
about economic issues and growth for the Nation and core 
infrastructure.
    It is something that, I think, we think is a very important 
project, and the President and Vice President have spoken to 
that issue and want to make sure that we move forward as 
quickly as possible with moving forward on the Port. Optimistic 
that the WRDA bill will pass, that that is something that will 
happen and be a part of, and that we can move forward with that 
Project as quickly as possible. And as I have said, we look 
forward to working with you to make sure once that happens, 
that we can move this Project forward because we agree, it is a 
good and strong Project.
    At the same time, my role and responsibility as the 
Director of the Office of Management and Budget, which is why 
the WRDA issue is there, has to do with protecting the FSK. I 
think many people on this committee know the Army Corps has a 
backlog of $60 billion, and we need the reauthorization, and 
what we need is for the Congress to speak. And when the 
Congress has spoken, and we are looking forward to that on this 
Project that, we believe, is an important one, we look forward 
to moving forward.
    Senator Isakson. In a letter sent to you by myself, Senator 
Chambliss, and every member of the Georgia delegation about 
questioning how the Project got stopped all of a sudden, and I 
want to quote your answer,

          ``Particularly during fiscally challenging times, it 
        is essential that we do not create special exceptions 
        that could undermine well-established controls of 
        responsible allocation of taxpayer resources.''

    What exception were you referring to in terms of the Port 
of Savannah?
    Ms. Burwell. With regard to the question of the exception, 
it would be waiving the 902. There is a rule that was put in 
place that said if an Army Corps project exceeds costs by 20 
percent, the Congress needs to speak again. And that was a 
matter that the Congress put in, that is a rule that is about 
making sure that we have fiscal responsibility with the Army 
Corps.
    This is a terrific project and a great project with a very 
high return on investment.
    Senator Isakson. As you know----
    Ms. Burwell. There are many more other Army Corps projects, 
I am afraid, that do not meet that test. And so, having the 
Congress be partners with us in doing fiscal control is 
something that is important.
    Senator Isakson. As you know, we think we are within 2 
weeks of WRDA passing. The 902 provision is in WRDA.
    What special exception would lie in our way to go forward 
if the 902 passes in WRDA? Is there any impediment that you 
see?
    Ms. Burwell. Senator, I look forward to continuing that 
conversation and I think there are ways that this project can 
go forward.
    Senator Isakson. I look forward to those meetings prior to 
the confirmation so we can do everything we can to solidify 
that.
    Thank you.
    The Chairman. Thank you, Senator.
    Senator Mikulski.

                     Statement of Senator Mikulski

    Senator Mikulski. Thank you, Mr. Chairman.
    Ms. Burwell, welcome to this confirmation hearing. Your 
focus is on you being Secretary of HHS. We welcome your husband 
and your friends, and I am sure you would want your mother and 
father here with you. They worked so hard for you to get the 
education that you have that helps bring you here today.
    Ms. Burwell, I know you personally and I admire you 
professionally. I knew of you when you worked during the 
Clinton administration and these Foundations, the two major 
Foundations you worked for, and then got to know you during the 
year at OMB as we went through a very tumultuous time. You were 
new at OMB and I was new as the chair of the Appropriations 
Committee.
    I must say, I really admired, one, your integrity in 
working with me. You were a straight shooter, and what you said 
you meant, and what you said, you did.
    We also appreciated your responsiveness; both Senator 
Shelby and I that, when we asked questions, we got answers. We 
did not always like the answers, but we got the answers.
    And third, we liked the fact that you were competent and 
that you also had the ear of the President of the United 
States, so again, when we needed those answers. So we know 
that.
    But let me tell you where I am as the Senator from 
Maryland. We need a CEO, and Secretary Sebelius has done a 
great job during a very difficult transition time at HHS. What 
we see in Maryland is some of your greatest Federal assets at 
HHS are in my State from CMS that does Medicare and Medicaid, 
the National Institutes of Health, FDA, HRSA.
    I also have some of the highest rates of Nobel Prize 
winners and some of the highest rates of poverty, whether they 
are in Baltimore City or mountain counties adjacent to West 
Virginia.
    I need a chief executive officer. We need someone who will 
bring executive skills to this job. Eighty-thousand people work 
for HHS. You have the largest budget, other than Defense, the 
largest domestic budget.
    We see three issues: money, management, and morale. Money, 
that is our job and sometimes we do it well, sometimes we do 
not. But we need someone in management who can tackle these 
tough problems, whether cleaning up the techno boondoggle of 
the HealthCare.gov to also going across the silos of agencies. 
And then we have a morale problem because of the way that my 
Federal employees have been battered by the budget, and the 
uncertainty of funding, and the trivializing of them and their 
work, you and I know that we have a morale problem, whether it 
is in FDA or NIH. And people are working elsewhere rather than 
bringing their great ability.
    So my question to you looking at your background, 
particularly in the area of the Foundation work with both Gates 
and Walmart, could you tell me the executive ability and 
experience that you think you bring to this job that can help 
put arms around this huge bureaucracy, often siloed, often 
fragmented, and at the same time help work with Congress on 
more certain funding that enables these agencies to do their 
mission?
    Ms. Burwell. First, I think I will speak to how I think 
about management and leadership.
    And first, I believe in any organization, you need to start 
with setting goals, defining roles, and responsibilities. And a 
part of that is an analytical process that includes both 
listening, as well as analytics and data. That is the first 
step.
    Another step is building strong teams and empowering them, 
and giving them the tools to succeed, and that is the second 
part.
    The third part, I believe, is a part of thinking through 
when you need to drive with analytics and when you need to 
understand that there is emotion. Because in leading large 
organizations, there is sometimes how people perceive and it is 
whether it is in an organization or an issue, the perception is 
their reality. And so analytics, you need to understand if 
people believe that, how do you drive for change.
    With regard to my own personal experience, I have had the 
chance to work at the Gates Foundation where I worked across a 
number of issues from doing innovative funding to vaccine to 
actually delivery of healthcare in the developing world, which 
is a challenging place to do that kind of delivery. To work on 
issues of actually, as the COO, employer-based healthcare, I 
know what it is like when you have changes in your employee 
base and what that does to what you pay.
    At the Walmart Foundation--I was able to work at that time 
with the world's largest grocer and retailer--in terms of both, 
it is an institution that provides healthcare for its 
employees, but the work we did was in the space of hunger.
    Those are some of the examples. I am watching the time, 
though.
    Senator Mikulski. I appreciate that, and my time is up.
    I just know that many people will focus on healthcare, and 
I certainly, it is my passion, but the human service part of 
your portfolio is absolutely crucial.
    And today is not the day, but we really need to work 
together on this issue of the unaccompanied children coming 
across our border, so that they have a home and that they have 
a way to get to a home, and we have a way to get to the funding 
that ensures that.
    Ms. Burwell. Senator, I look forward to working with you on 
that very important issue for those children.
    Senator Mikulski. Thank you.
    The Chairman. Thank you, Senator Mikulski.
    Senator Roberts.

                      Statement of Senator Roberts

    Senator Roberts. Thank you, Mr. Chairman.
    Ms. Burwell, thank you for coming.
    Last August, Senate Majority Leader Harry Reid was asked 
whether his goal was to move the Affordable Healthcare Act to a 
single payer system. His answer was, ``Yes, yes, absolutely 
yes.'' Similar statements were made by former Speaker Nancy 
Pelosi, your predecessor, and the President of the United 
States.
    Do you agree with that statement, there is a difference 
between administrating the law and pushing an agenda? Is it 
your endgame to see the Affordable Healthcare Act expanded 
beyond the exchanges to a single payer system?
    Ms. Burwell. Senator, if I am confirmed, I will implement 
the law. And the law is a system that is a market-based system, 
and that is what the exchanges are up and running, and putting 
people in systems that are private insurance systems.
    I look forward to, if confirmed, making that system work as 
efficiently and effectively as possible, both in terms of cost 
and access.
    Senator Roberts. I appreciate that.
    One of my biggest concerns with the Affordable Healthcare 
Act is the Independent Payment Advisory Board, IPAB. It was 
created by the law. The Board is supposed to be made up of 15 
unelected advisors who will decide which treatments of the 
Medicare coverage should be reformed; I would say terminated. 
They have no accountability and their decisions are practically 
impossible to overturn.
    Now, despite having yet to appoint any IPAB members, the 
President's budget this year proposed to expand IPAB's role. 
Considering the law requires that IPAB produce reports in 2014, 
do you know when the President will make his appointments to 
this unelected Board? And in the absence of a Board, the HHS 
Secretary, namely you, will have the authority to act as an 
IPAB Board of one. If confirmed, will you activate the Medicare 
reform or again, what I would call rationing, using your 
authority under IPAB?
    Ms. Burwell. Senator, first, I think it is important with 
regard to IPAB that one of the most important parts of the 
provision there is that beneficiaries cannot be impacted. Any 
changes would not be toward beneficiaries.
    The other thing I would say about IPAB is I actually am 
hopeful, and if confirmed and even in my job at OMB, that IPAB 
never needs to be used. It can only be triggered and in the 
current window that we are looking at, and in the window, if 
confirmed, that I would serve, it is our estimate that actually 
it would never be activated.
    What I think is important and at the root of this is an 
issue that, I think, both sides think are important, and that 
is controlling healthcare costs for the Federal Government. It 
is about our fiscal issues for the future, and what I am 
hopeful that we can do is make sure that IPAB never gets 
triggered because we put in place the mechanisms to do that 
control. Right now, it is.
    Senator Roberts. OK. That is what I hope, too, and I 
appreciate that. But I am not quite as optimistic as you are, 
but we can go over that at a later time.
    According to the Galen Institute, Obamacare has been 
delayed at least 35 times, 22 of those times were done 
unilaterally by the Administration. Since being the Director of 
OMB, you have approved 15 of these 22 delays, this includes the 
second delay of the employer mandate.
    My question is about fairness and I get that from 
individual Kansans. The Administration gave business an extra 
year, and in many cases 2 extra years, to comply with the 
employer mandate. Do you think it is fair to give businesses 
delay but not individual Americans? And, what further changes, 
if any, to existing law and regulations, do you anticipate 
having to make before December 31st of this year?
    Ms. Burwell. Senator, I think the changes that you are 
referring to are a number of different things that have been 
taken by different Departments, Treasury or HHS, in a number of 
the examples that I think you are referring to.
    With regard to what is happening as this process goes 
forward, when the Administration has predicted, what we are 
trying to do is common sense implementation within the law; 
that is the objective and what is worked on.
    With regard to the specific issue you raised, which is the 
issue of the employer mandate and that specific question, as we 
think through transitioning, one of the things that we have 
tried to do is listen and hear. And one of the things that the 
private sector has said is it was difficult to get the 
reporting to the right place where it could then be applied and 
done. The changes that were made were to try and do that 
transition.
    With regard to individuals, there are a number of other 
things that are happening to help with those transitions, and 
whether that is the hardship issues or other issues. And so, 
this is about transition to a change system.
    Senator Roberts. I would like to see those transitions come 
back to the Congress so we would at least have some 
consequential involvement.
    I am out of my allotted time, Mr. Chairman, but I will be 
submitting some further questions in writing that I hope you 
will respond to in a time manner, particularly with regard to 
abortion coverage, transparency for insurance plans offered in 
the Federal exchanges.
    Again, thank you for coming.
    Ms. Burwell. Thank you.
    The Chairman. And thank you, Senator Roberts.
    This would be Senator Bennet.

                      Statement of Senator Bennet

    Senator Bennet. Thank you, Mr. Chairman.
    It is nice to see Ms. Burwell. Thanks for being here today. 
Like others here, I am very happy that you have got the 
experience that you do at OMB, and I wanted to ask you a couple 
of questions sort of along those lines.
    When I, a number of years ago, first became superintendent 
of the Denver public schools, I carried the budget of the 
school district around with me for 6 weeks unable to understand 
it. I had worked with budgets before, in the private and public 
sector. This is impenetrable. And finally, 6 weeks in, I 
realized that I was not reading a budget in the sense you or I 
would understand it as a management tool. It was an accounting 
tool. It was a tool to demonstrate compliance with the State 
regulator and with the Federal regulator. It was not about 
driving outcomes for kids, which is what we were supposed to be 
doing.
    My sense, having been here is that we face very much the 
same thing when it comes to healthcare. The morass of 
regulations and the reimbursement policies from CMS, the 
uncertainty that is caused by the fighting up here over budgets 
that leave people with insecurity about what the future is 
going to look like, I think, creates an environment where 
people are less capable of getting into a pattern of continuous 
improvement. I mean, people that are out there actually 
delivering services to people rather than just yelling at each 
other in Washington, DC. And they are wary about this, and I 
think they feel, they remind me of my teachers, my principals 
in the district who felt the same way.
    I wonder if you could tell us a little bit about your 
theory of the case for attacking that management side of the 
work that you now will have to do at HHS and CMS, and how your 
work at OMB is going to inform that.
    One last point. In this existential debate that we are 
having here about the role of the Federal Government, and the 
Founding Fathers, and all of that, I think what we have lost is 
what the American people really would like, which is, an 
efficient and effective Federal Government.
    Ms. Burwell. Right.
    Senator Bennet. And an efficient and effective partner to 
State and local governments, and to others; so anyway, just a 
perspective. I will yield you the rest of my time.
    Ms. Burwell. I will speak to that in the context of the 
``M'' part of the OMB in terms of the role that I have been in, 
in the past year.
    With regard to the issues of management, when you look at 
our budget, you will see that we articulate what is a second 
term management agenda, the four elements of that agenda are 
efficiency, making sure we use the taxpayer dollars the best, 
and just last week, there was an announcement. We have four 
departments that will be doing shared services, which is a 
private sector way to get to some of that efficiency.
    Effectiveness, which gets to your point about customer 
service; when we say ``effectiveness,'' it is about serving the 
customer. The customer for the Federal Government, there are a 
number of customers: individuals, States and local Governments, 
and the private sector at times when they interact with people 
like the FDA. How do we make sure we are doing that?
    The third area is how do we use the management of the 
Federal Government to support economic job creation? And on May 
9th, it will be the first anniversary of the use of open data, 
and putting that data out there to create economic development.
    The last is people, and having had a chance to work on all 
of those issues and then working with the departments to have 
their goals connect to their money. To your point about is it a 
document that is about checking boxes, or is it a document that 
reflects how we spend dollars to deliver impact?
    So those are the ways that my current experience has 
allowed me to work.
    Senator Bennet. And on that last point, I am not sure how 
you want to approach it, but one thought is that without people 
that are dedicated every day to coming in and thinking about, 
``How do we get rid of the box checking and replace it with 
stuff that really matters?'' In your tenure, you are not going 
to be able to get it done, so I hope you will do that.
    I also wanted to mention, Senator Burr here, I think he is 
now gone, but he and I have had some really good luck with 
something called Breakthrough Therapies at the FDA. You and I 
talked about it the other day. I just would like the 
opportunity to be able to work with you to see where we could 
expand the sort of notional sense of that which was where 
possible and where feasible we should be accelerating approval 
so that the United States holds onto its leadership in 
bioscience at a time when there are plenty of other countries 
in the world that would like to out-compete us.
    Ms. Burwell. Welcome that opportunity and one of the things 
when I think you can have innovations of things that work like 
that, you look at those innovations and then think about how do 
those apply more broadly to the broader portfolio. The 
breakthroughs are special cases, but I am sure there are things 
we can learn that apply to the broader portfolio.
    Senator Bennet. And things that can inform the broader 
culture of the agency as well.
    Ms. Burwell. Yes.
    Senator Bennet. Thank you, Mr. Chairman.
    The Chairman. Thank you, Senator Bennet.
    Senator Enzi.

                       Statement of Senator Enzi

    Senator Enzi. Thank you, Mr. Chairman.
    And thank you to Ms. Burwell for meeting with me yesterday. 
I always enjoy the visits with you. I have a few questions. I 
think I mentioned this topic yesterday.
    During your tenure at OMB, we saw a massive failure of a 
Web site, which was HealthCare.gov and that is a Web site the 
Administration had 3 years and $600 billion to build. I know 
from personal experience, first users could not logon, then we 
could not see plans available, and then we got kicked off, and 
then usernames were not recognized. And from folks I have 
talked to, even users who made it through the end of the 
process often did not get confirmation they had enrolled in a 
plan as Obamacare mandates. As Director of OMB, you were 
responsible for the oversight of Agency Performance and 
Information Technology.
    What role did you play in the development, testing, and 
approval of the Web site?
    Ms. Burwell. Senator, first, I think it is important to 
recognize what the President, and the Secretary, and the 
Administration have said, which was the rollout was 
unacceptable.
    With regard to the role that OMB plays, the direct 
implementation on a day-to-day basis of IT projects is done on 
a department by department basis. OMB has a process that is 
called TechStat, which is what happens when we have cases, 
HealthCare.gov being an extreme one, of an approach that we 
take to get in and quickly try and correct the situation by 
applying high quality resources, and a surge of resources to 
the problem, which is what was done.
    In addition at OMB as part of followup and part of the 
``M'' role that I play, we spent time examining very 
specifically what we think are areas of improvement in IT 
procurement and delivery. And I would be happy, I do not want 
to use all of our time, but be happy to articulate what those 
are.
    Senator Enzi. OK. Well, continuing on this anyway.
    The Administration contends that many of the highly visible 
problems with the Web site have been fixed, but I do not think 
the work has been completed on the less visible backbend 
information which, of course, all of us would like to have and 
that is necessary for the programs.
    I think there have been some warnings from CMS that failure 
to get this fixed by March would mean that, ``The entire 
healthcare reform program would be jeopardized.''
    Is that the reason for justifying the need to award the no-
bid contract to Accenture? And why have the problems not been 
fixed?
    Ms. Burwell. Senator, if I am confirmed, the issues of 
information technology, especially around HealthCare.gov, would 
be a top priority for me.
    With regard to the issuance of contracts, that is something 
that a department specifically does, and OMB does not play a 
role in. I am not able to speak to the specifics of 
contracting. If confirmed, though, this is something that, of 
course, would be a top priority to make sure that the system, 
both the specifics that you are talking about and the backbend 
that you are referring to, are something that I pay attention 
to.
    Senator Enzi. OK. I will have some followup questions on 
that later, then, when you are in that position, I guess.
    In February, ``The New York Times'' reported that 1 in 5 
people who complied with the individual mandate did not pay 
their premiums in January. At that time, the CMS spokesman said 
the Administration could not say how many people had paid their 
premiums.
    On April 30, the House Energy and Commerce Committee 
reported that only 67 percent of the enrollees had paid their 
first premium by April 15. When the Administration disputes 
this figure, while it disputes it, you have not released your 
own official numbers yet, I do not think.
    When will the Government determine who has paid the 
premiums, and therefore is actually covered as required by the 
individual mandate?
    Ms. Burwell. Senator, I probably should start with my 
philosophy about data and information, and it has two 
fundamental parts to it: transparency and accuracy. That is how 
I think about it and speed, with Congress.
    At my time at OMB, the regulatory agenda, which is 
sometimes a controversial document, is something that I have 
worked hard to get up in the spring and fall on time, and will 
be again this year.
    With regard to the specifics of the data that HHS has at 
this time; that is not something in my current role that I 
know. I know that there were hearings yesterday that spoke to 
this matter, where the insurance companies articulated a range, 
because they are the people providing the information.
    And so, if I am confirmed, that is something that I will 
want to understand on what pace that happens.
    Senator Enzi. But you have not released official numbers 
yet.
    Ms. Burwell. No, sir. The Administration has not because I 
do not think that the insurance companies have given final 
numbers.
    Senator Enzi. OK. The insurance companies. I will have some 
followup questions on that in writing.
    Thank you, Mr. Chairman.
    The Chairman. Thank you, Senator Enzi.
    Senator Murphy.

                      Statement of Senator Murphy

    Senator Murphy. Thank you very much, Mr. Chairman.
    There was a really remarkable hearing in the House on this 
subject yesterday in which House Republicans called insurers to 
testify, in part, as to what they believed to be incredibly low 
rates of premium payment. And the headline from ``The New York 
Times'' this morning is, ``Called by Republicans, Health 
Insurers Deliver Unexpected Testimony.'' And that testimony 
was, in part, that WellPoint suggests that 90 percent of their 
customers have paid premiums. Aetna suggests that the numbers 
are in the low- to mid-80 percent range. They also, according 
to this article, declined to endorse Republican predictions of 
a sharp increase in insurance premiums next year.
    This comes on the heels of a Health Affairs report that 
suggests that though there certainly have been cancels of 
policies since the law was passed, it is not really out of step 
with the rate of cancellations that happened before the law was 
implemented.
    A new Gallup survey shows an absolutely astounding drop in 
the number of people who are uninsured. A 25 percent drop, 
according to Gallup, over the course of the third quarter into 
the second quarter of this year.
    I say all this because I think this increasing avalanche of 
good news and positive data about the implementation of the 
Affordable Care Act is going to ultimately lead to a much 
broader public acceptance and support for the law. And yet, we 
still have sort of ``A Tale of Two Countries.''
    We have States like Connecticut that have worked hard to 
implement the law. We have doubled our initial expectations in 
terms of the number of people we thought would enroll. Then you 
have States that are, at best, not implementing the law and, in 
some cases, trying to undermine the law.
    I guess my question is, how do you attack this issue of 
States that are not doing the things that, for instance, 
Connecticut and California are doing? And maybe respond in part 
to some things you said, referring to a question by Senator 
Alexander, what are the ways in which we can work in a flexible 
manner with these States as they maybe wake up to the reality 
of how well the implementation is going after the initial 
botched rollout?
    What are the ways in which we can work with some of those 
States that have not done things like Connecticut to try to 
make this work in all 50 States rather than just in the handful 
that have set up their own exchanges?
    Ms. Burwell. I think there are two things, and it does come 
back to the point about flexibility being one of the points. 
And I think what is important is to send a signal that folks 
are willing to have the conversations.
    As I said, it is important if there are fundamental 
principles to articulate those in terms of the change you are 
trying to get, but be willing to have the conversations and 
hear the ideas. I think that is what happened in the Arkansas 
case, and if I am confirmed, that is something that I would 
hope we, as a Department, can continue to do.
    With regard to the other thing, that is about the 
relationship to get that to happen. I think the other thing 
with regard to how other States will come is I think that as 
people see what happens in the form of implementation--and 
while I understand the point that Senator Alexander made about 
costs in Medicaid, which is an important one--I think what 
people are also going to see are the changes in terms of health 
benefits in the States that have implemented, both from a 
health perspective, and I actually think we are going to start 
seeing some of the cost benefits in terms of reduction of 
indigent care. Many of us are from rural places and you know 
the pressure that that puts on small, rural institutions and 
hospitals.
    I think both the results, as well as the willingness for 
conversation, are the two ways that one can make progress on 
that front.
    Senator Murphy. Let me ask you a big question about 
delivery system reform that maybe you can give a short answer 
to, which is, I think you will hear a lot from us on our hope 
that you are able to speed up the pace of delivery system 
reform changes at HHS. But one of the tensions is between the 
necessity to build bigger systems that can really track 
outcomes and coordinate care, and the desire to make sure that 
we have a competitive marketplace. Connecticut is a State, for 
instance, that may, 10 years from now, only have two healthcare 
systems.
    How do you balance, ultimately, this need to build good, 
integrated systems of coordinated care, which may require more 
doctors working for hospitals, for instance, while making sure 
that we do not unintentionally set up monopolies in certain 
areas of the country where you may have one big health system 
that is unavoidable from the perspective of an insurer that is 
trying to build a robust network? I am a believer in big, 
coordinated systems of care, but I think that is a lingering 
concern that exists as you build out a new system.
    Ms. Burwell. One of the things in terms of philosophy about 
that is I think that you appropriately said is the issue of 
balance. And thinking about, what are the elements that need 
coordination in terms of is it information sharing? What is it 
that creates that level of coordination, at the same time 
promoting competition? And things like the co-ops and other 
things.
    How do you get to, what is the key element that is causing 
the delivery system efficiency? Is it the fact that it is a 
single provider or is it the fact that it is an approach, a 
standardized approach to information?
    One of the ways you work to get that balance right is by 
trying to understand, as clearly as possible, what is driving 
the change you are getting, both in terms of quality and price.
    Senator Murphy. Thank you.
    Thank you, Mr. Chairman.
    The Chairman. Thank you, Senator Murphy.
    Senator Murkowski.

                     Statement of Senator Murkowski

    Senator Murkowski. Thank you, Mr. Chairman.
    Ms. Burwell, welcome to the committee.
    As I was walking over here, I encountered a number of 
individuals that are here on the Hill today for ALS Advocacy 
Day, a cause that you and I both share and are committed to, 
and assuming that you are confirmed to this position, look 
forward to working with you aggressively to make a difference 
in this horrible disease.
    We had an opportunity to visit last week, and I appreciate 
the time that you gave me, but in the visit, I explained to you 
the situation in Alaska where we are a very high-cost State. 
Our insurance costs are equally high, second highest in the 
Nation. Our demographics, our geography, just causes us to be a 
little bit different.
    You mentioned the need for flexibility within rural areas. 
There is nothing more rural than an Alaskan. We are so 
challenged with this.
    I shared with you that we have over 139,000 uninsured 
individuals. Less than 10 percent of those individuals have 
enrolled in healthcare plans. And in looking at the numbers 
behind it, it really comes down, again, to the cost. The ACA 
has more than doubled premiums in the State. I shared with you 
that a 19-year-old Alaskan could pay $911 back in 2013 for one 
of the low-cost Premera plans, but if they buy the most 
comparable plan now for that same product, the plan is more 
than double the cost at over $2,300. And then I walked through 
the statistics with 64-year-olds.
    Mr. Chairman, I am going to be submitting, for the record, 
a document that my staff has put together with Premera Blue 
Cross that shows the GAO recorded data on premiums in Alaska in 
2013 as compared to where we are now. Just so, again, there can 
be a better understanding as to what we are facing here.
    We have not worked to reduce the cost of healthcare, which 
we must do and I appreciate what Senator Murphy has said about 
delivery reform. But in the meantime, the financial burden to 
our families is such that they are looking at this and saying, 
``I am better off just paying the fines that will come with 
it.'' So I am asking you to take a look specifically at what we 
are facing in Alaska.
    I also want to bring up with you a conversation that I had 
with firefighters from my State from different parts of the 
State--up in the Matanuska-Susitna Borough, talked to 
firefighters up there, up in Fairbanks, down in the 
southeastern part of the State--and concerns about application 
of the ACA within the emergency services sector; a concern 
about employer mandate, a concern about the 30-hour workweek.
    What I heard from the Mayor in Mat-Su was that they have 
moved their emergency personnel to a 29.9 hour per week cap for 
nonfull-time employees. Many of the stations are reducing the 
hours beyond the required 29.9 to 24 hours per week to include 
personnel who work both as EMT's and as firefighters.
    This is an issue for us where our growth in these areas is 
growing. We rely on our emergency services folks because they 
cover enormous areas. What we are seeing is a real chilling 
effect here on employment, particularly as it applies to our 
first responders.
    I guess I would ask more of a question in the vein that, do 
you agree we have a problem with this? There are a few 
Senators, I am joined with Senators Collins and Donnelly, to 
help address this.
    Do you see an opportunity for us to address this definition 
of 30-hour workweek and the implications that it is having, not 
only on EMS, but other areas of the economy?
    Ms. Burwell. Senator, I would like to learn more about the 
specific example that you have articulated.
    Senator Murkowski. I am happy to provide that, yes.
    Ms. Burwell. And the issue of broadly, all in terms of the 
job creation that has occurred since the Affordable Care Act, 
9.1 million private sector jobs.
    The San Francisco Fed just released a report that said that 
the part-time issues are consistent with a recovery. Having 
said that, we would like to learn more about the specific issue 
you have raised.
    With regard to the specific legislation that changes the 
numbers, one of the things--there are a couple of concerns when 
CBO scored that legislation in terms of cost, but also that 1 
million people in that setting would also lose their employer-
based care.
    And so, would want to understand the specifics of the 
situation that you are talking about, as well as coming to 
understand this better, the piece of legislation.
    Senator Murkowski. I am happy to provide that to you as 
well as the other information. I will also be submitting for 
the record, Mr. Chairman, a couple of different questions. One 
on Head Start, but also one that is very timely and in the news 
right now, and that is the issue of the FDA proposed rules on 
e-cigarettes.
    I have a real concern here that we are setting forward a 
proposed rule that does not look to the flavoring that is going 
into these e-cigarettes, the impact on our children, some of 
the studies that we have seen. So I would like your views and 
your perspectives on that as well.
    [The information referred to may be found in additional 
material.]
    Senator Murkowski. Thank you, Mr. Chairman.
    The Chairman. Thank you very much, Senator Murkowski, 
especially on the e-cigarette issue. Any way that I can be 
helpful or supportive, let me know. You are right on-target on 
that one. Thank you.
    Senator Baldwin.

                      Statement of Senator Baldwin

    Senator Baldwin. Thank you, Mr. Chairman.
    Thank you, Ms. Burwell, for your time here today and 
talking about your vision for the Department.
    I appreciate the opportunity we have had to speak in 
advance of this hearing and wanted to talk about a couple of 
different topics.
    The healthcare system has been plagued forever with a lack 
of transparency, yet gathering data, disseminating and sharing 
data is incredibly key to helping physicians understand where 
they lie with regard to other physicians' practices. Data also 
helps us understand how hospitals go about pricing things, what 
their costs are, which in turn helps patients make wise 
decisions about choosing providers, particularly if they need 
an operation or a specific treatment.
    This is an issue where we have seen some variation from 
State to State. I am proud to tell you that in the State of 
Wisconsin, I think we have been a real leader with an 
organization called the Wisconsin Health Information 
Organization. It intends to be an all-payers claim data base 
that does some further analysis and disseminates the 
information to increase transparency, help improve quality, and 
help rein-in costs. Yet, we have had some frustrations with 
regard to access to Medicare claims data.
    I have worked with a number of my colleagues on a 
bipartisan piece of legislation called The Quality Data, 
Quality Healthcare Act which would fix this by expanding what 
is known as the Qualified Entity Program to allow entities to 
analyze and redistribute Medicare data to those who can best 
use it for quality improvement and cost reduction purposes. And 
I was really pleased to see that the President's budget 
supported many of the reforms that are contained within that 
bill.
    I wonder if you can speak directly to the issue of 
expanding the current Qualified Entity Program, and its 
potential to improve quality, and to rein in costs. Can you 
also talk more expansively about the role you would play in 
increasing transparency across our healthcare system?
    Ms. Burwell. With regard to the specifics of the expansion 
of the program, I would look forward, if confirmed, to working 
on that issue specifically as you mentioned. In the budget, 
there are some parts of doing that.
    The broader issue of the transparency is something that we 
talked about in a number of forms in terms of data and 
information, and also specifically for how it helps with the 
delivery system issues. And so, I think getting the 
information, as I said, that may be a link that is as important 
as the issue that we were discussing about how you balance 
single entities that start developing in terms of the dominance 
in a market.
    I think information in markets is an important thing. And 
so, the better we can get it and the more we can get it to both 
the individuals, as well as the providers. As you mentioned in 
the beginning of your comments, it is actually about the 
doctors also as well seeing the information.
    So with regard to how I think about the issues, I believe 
this is an important part of both quality and cost, and it is 
both important for individuals, as well as insurers, as well as 
doctors. And the more we can have, and the information that was 
provided recently, I think, was important information that was 
recently put out by HHS.
    I think it is also important as we think through this 
information, to make sure that it has context when we put out 
the information, making sure that individuals and others can 
use it in a way that it is given the appropriate context. 
Because the data without that can sometimes be something that 
does not provide the insights that one would hope it would.
    Senator Baldwin. Thank you.
    I am short on time. I am going to place another question 
before you. We may have to have you answer in writing, but I 
wanted to get to something very Wisconsin-specific regarding 
Affordable Care Act implementation.
    We had the good news last year that nearly 140,000 
Wisconsinites had signed up through the marketplace. It was 
60,000 beyond the target that was set prior to the enrollment 
period. And this was despite fierce ideological attacks against 
the Affordable Care Act, both in Washington and in our State 
government.
    But unfortunately, across America and in my home State of 
Wisconsin, some Governors have not taken full advantage of the 
opportunity to expand coverage, specifically Medicaid coverage. 
Governor Walker is among those Governors, and he failed to 
seize that opportunity, and the consequences in my State are 
fairly severe. 77,000 Wisconsinites are losing their Medicaid--
or what we call BadgerCare--coverage because of that decision.
    Other States are working with the Federal Government, Iowa 
and Arkansas in particular, to find new, innovative ways to 
expand coverage to these very vulnerable populations.
    So, I want to know if, and you can followup now or 
afterwards, what options will be available to Wisconsin that 
are not currently being pursued? Will the Department continue 
to help make sure that these 77,000 people who are losing their 
BadgerCare are successfully enrolled in the marketplace? And 
certainly, will the State of Wisconsin have an opportunity to 
reconsider their decision, at this point, not to expand 
Medicaid?
    Ms. Burwell. Senator, if I am confirmed, I would want to 
work with CMS on those specific issues, the flexibility to help 
those 77,000.
    The Chairman. Thank you very much, Senator Baldwin.
    Senator Burr.

                       Statement of Senator Burr

    Senator Burr. Thank you, Mr. Chairman.
    Director Burwell, welcome and thank you for the opportunity 
to meet with you, I think, last week and to share some thoughts 
and to hear yours. Let me ask you a couple of questions in 
specific areas.
    Do you consider medical and public health preparedness and 
response programs to be a matter of national security? And if 
you are confirmed, how will you ensure that these programs be 
prioritized, fulfill their mission, and that the Pandemic and 
All-Hazards Preparedness Act be fully implemented?
    Ms. Burwell. Senator, I do consider it a matter of national 
security, and my old role at Gates have been exposed--as you 
and I had the opportunity to discuss--to a number of these 
issues. And thank you for your leadership in this space, 
because I think it is very important.
    I am excited that there was a reauthorization that occurred 
and that the Congress spoke to these matters. And now, would 
want to work to implement what was reauthorized in 2013, if I 
am confirmed, on these issues. I think they are very important 
in terms of how we think about what are the tools we have, and 
then how we get access to those tools when we need them.
    I think you have spent a lot of time, as our conversation 
reflected, thinking about the best ways to make sure that we, 
(A), have what we need if something bad does happen; and then, 
(B), how you effectively and efficiently, in the most cost-
effective way, scale up in a quick timeframe to do that. And 
that is something that, for me, I would look forward to if 
confirmed working on.
    Senator Burr. Thank you for that.
    What opportunities do you see to improve regulatory 
certainty and predictability across the Department, 
particularly at the FDA?
    Ms. Burwell. I think with regard to the issue of 
regulation, more broadly, just in terms of my philosophy and 
experience and time at OMB, since the year that I have been at 
OMB, we have reduced the regulatory backlog by almost 75 
percent, and have moved to a more timely approach to our 
regulatory agendas in terms of what I have done and how I think 
about those issues.
    With regard to the FDA and thinking about these issues, I 
think one of the things, as an institution, I would want to go 
and spend time and in conversations like ours, learn what 
people believe are the critical path issues to a more effective 
system that produces both quality and speed, and protects 
health of the American people, but also supports our economy, 
because it is an important part of economic growth.
    Senator Burr. Thank you for that.
    As Senator Mikulski mentioned earlier, Murkowski mentioned 
earlier, we have a lot of patients with ALS here today. We do 
not yet know what causes it, which makes it----
    Senator Mikulski. And Senator Mikulski.
    Senator Burr. And Mikulski as well--to unlock the key to a 
cure, you first have to figure out what the cause is.
    I go through this thought process of what if we got to that 
point and then all of a sudden, the therapy, the 
countermeasures of a cure breaks down at the FDA? So I 
appreciate your willingness to dig-in to it because I think 
that certainty drives capital investment in the space and helps 
these patients.
    Will you give your personal commitment to me that if 
confirmed, CDC and ATSDR will execute the planned cancer 
incidence study on the Camp Lejeune population without delay?
    Ms. Burwell. First, I just want to thank the Senators that 
have mentioned the ALS issue because even mentioning it in a 
hearing, I think, is an important part of the progress on the 
issue.
    With regard to that specific issue, my understanding is 
that that work is going forward in terms of the cancer study. 
And if I am confirmed, that is something that I would want to 
work to make sure we do in the most expedited fashion.
    Senator Burr. Thank you very much for that.
    Mr. Chairman, on a personal note, I know that the committee 
will not vote on Director Burwell's nomination, but we will in 
the finance committee.
    And I would like to take this opportunity to tell my 
colleagues, I support her nomination. I will vote for her in 
the finance committee and it is for one, primary reason. It is 
because she does not come with a single experience that would 
make her a good Secretary. She comes with a portfolio of 
experience that would make her a tremendous asset at addressing 
some of the challenges that that agency specifically and 
uniquely has. And I look forward to her confirmation being 
quick and our ability to then work together to be every bit as 
quick.
    I thank the chair.
    Ms. Burwell. Thank you, Senator.
    The Chairman. Thank you very much, Senator Burr.
    Senator Casey.

                       Statement of Senator Casey

    Senator Casey. Director Burwell, thanks very much for your 
appearance here today, your testimony, as well as your 
commitment to do the job that I think you will do at HHS. But I 
guess in a larger sense, we thank you for your substantial and 
enduring commitment to public service over a number of years 
now, and in all of the positions that you have had.
    I wanted to raise, in the limited time that we have, at 
least two major questions with regard to children. It is my 
opinion that our country still lacks a real strategy for 
children. We have made some progress, substantial progress on 
children's health insurance; I will talk about that in a 
moment. Still, we have made no substantial national commitment 
to early learning, not to the extent that I hope we would. The 
protection of children could use an awful lot of work, as well 
as strategies to make sure that children can have enough to eat 
and get nutritious food.
    On those four indicators, I think we are lacking, although, 
some are further down the road than others. But I still think 
we lack a basic strategy for our children, just like we have a 
strategy for national defense or other major priorities.
    I wanted to start with the Children's Health Insurance 
Program, a substantial bipartisan achievement over the last 
generation. As you know from your work during the Clinton 
administration, that was a bipartisan effort here. One of the 
models, not the only model, but one of the biggest and most 
successful early models before the Clinton administration 
enacted was in Pennsylvania, my home State. And because of 
models like that, we now can say that some 8 million children 
are covered, but more need to be covered, and there are 
efforts, as you know, to do that. These are not exact, but 
around 200,000 children in Pennsylvania are covered by the 
Children's Health Insurance Program.
    Having said all that, the bad news is that the funding will 
expire for CHIP at the end of September, No. 1. And No. 2, 
there have been efforts made, and I have to say some of this 
has been in both parties, to intentionally or unintentionally 
undermine CHIP over the last couple of years. We are going to 
fight really hard to make sure that we preserve it and we fund 
it at all costs.
    I wanted to ask you about the impact on children's health 
if we failed to extend the funding for the Children's Health 
Insurance Program, and what you would do to make sure that that 
does not happen.
    Ms. Burwell. Senator, as you reflected, this is a program 
that I had the chance to work on, and be a part of the initial 
passage during the Clinton years, and something that we thought 
was very important. And what is great is to come back and see 
the progress that you just articulated in terms of those 8 
million children.
    This is a program that is delivering. It is a program that 
is successful. And in the Administration, whether in my OMB 
role or if confirmed in the HHS role, I would look forward to 
working with the Congress to make sure that we continue what is 
a successful program that is delivering for children in an 
important way.
    Senator Casey. I appreciate that because it is a major 
priority of mine, but I think it is shared by a lot of people 
across the country.
    Second, and you and I, when we had a chance to discuss your 
nomination, talked about CHGME, the acronym for the Children's 
Hospitals Graduate Medical Education program; another area 
where there is substantial bipartisan support. Senator Isakson 
and I worked with a number of members of the committee, 
Chairman Harkin most prominently, to ensure that this program 
was reauthorized. In a remarkably bipartisan effort, it has now 
been reauthorized for 5 years. We actually have a copy of the 
bill signed into law. That does not happen too often around 
here. That is the good news.
    The bad news is, I think there are still some folks in the 
Administration that have a different view about how to move 
forward with it. Maybe some would agree with the 
reauthorization of it, but I would even question that.
    Presently, I am most concerned about the funding of this 
program, which is the one program--and a tremendously 
successful program--that trains medical students specifically 
in children's hospitals. Without this program, we would be in 
big trouble.
    I ask you that as you contemplate other strategies on this 
and other ways to fund it that you consult closely with me and 
with others on the committee as we move forward. I just ask for 
your commitment on that.
    Ms. Burwell. Senator, I would welcome that opportunity.
    Senator Casey. Thanks very much.
    The Chairman. Thank you, Senator Casey.
    Senator Hagan.

                       Statement of Senator Hagan

    Senator Hagan. Thank you, Mr. Chairman.
    And once again, Director Burwell, thank you for being here 
today. Thank you for your service in the other administrations, 
as well as OMB, and we look forward to working with you as the 
Secretary of HHS.
    I wanted to ask about Medicaid expansion. Last year in 
North Carolina, our State legislature and Governor decided 
against expanding the State's Medicaid program. And as a 
result, about 500,000 people who would have qualified for 
coverage through Medicaid are now not able to do so.
    These are some of the most vulnerable citizens in our 
society who will continue to seek care in emergency rooms, and 
then will leave chronic conditions unmanaged, which we know is 
detrimental not only to their health, but certainly to the 
economy too. And it leads to higher costs for the patients, it 
drives up costs for hospitals, and it drives up costs for the 
insured who still will pay higher prices to cover their care.
    Director Burwell, can you compare the experience of States 
that have expanded their Medicaid programs to those who have 
not, commenting specifically on the health of newly eligible 
enrollees and whether there are any increased costs to States 
or health providers like hospitals?
    Ms. Burwell. Senator, I think what we are going to do is we 
will continue to see data and information as the law is 
implemented.
    But I think in States like my own State of West Virginia, 
we have already seen a decrease in the number of uninsured. And 
is starting to happen, both in terms, and--I think it will be 
two things over time. It is both that increased quality of care 
for people, which translates to their individual lives, but it 
also translates to the economy in terms of what people are able 
to do with their productivity. Over time, we will see that.
    I think we are also seeing over time, we will see the costs 
issues in terms of indigent care pressure that is being put 
across States when they have people who are coming with 
insurance. And so, I think we are going to see more and more of 
that data over time.
    But I think right now in a number of States, we already see 
the number of uninsured dropping.
    Senator Hagan. What happens if an adult, let us say a 35-
year-old woman from one of the major cities in my State, 
without children, and this individual falls under the Federal 
poverty line of about $11,000 a year. This individual has heard 
about the marketplace. She goes to the library, talks to 
navigators, asks to sign up. This person has done the right 
thing. She sought out coverage to protect her against high 
medical bills, help her get health insurance.
    But what options will that woman have if a State like mine 
does not expand Medicaid?
    Ms. Burwell. It will depend in terms of her level. I think 
you described a level that I would want to get the details in 
each place and each State. It depends on her level of income 
and whether or not she would be eligible for formal subsidies.
    Senator Hagan. This woman would not.
    Ms. Burwell. If not, she will receive----
    Senator Hagan. She falls under that gap.
    Ms. Burwell. She will receive a hardship if she applies for 
and receives a hardship exemption. The hardship exemptions are 
about affordability, and in this case, I think the specifics--I 
would want to check the details of what you described.
    But that is an issue of affordability because in a State 
where Medicaid had expanded, she would have that opportunity.
    Senator Hagan. So in a State that expanded it, she would 
have had access where in the 24 States that have not expanded 
it, there are these huge numbers of people. In my State, 
500,000 that are still without coverage, there is nowhere for 
them to turn because they certainly cannot fund a normal 
insurance policy----
    Ms. Burwell. Right.
    Senator Hagan. On $11,000 a year.
    Ms. Burwell. And with regard to what the Federal Government 
policy is trying to do is to make sure that they have a 
hardship exemption. That is the part. It does not address the 
fundamental issue that you are talking about, which is: Do they 
have healthcare coverage?
    Senator Hagan. Right.
    Just to be sure, if a State expanded its Medicaid program 
last year, what would the cost to a State be for covering that 
newly eligible population? What would the State have to pay in 
2014?
    Ms. Burwell. Senator, I think that on a State-by-State 
basis, those are numbers that I would want to look into and get 
back to you on.
    With regard to the question of coverage, in terms of the 
State paying because the Federal Government--I am sorry. I did 
not understand the question. That would be zero. The State does 
not pay.
    Senator Hagan. So for 3 years, the State pays zero.
    Ms. Burwell. The Federal Government will pay for those 
years.
    Senator Hagan. Thank you.
    Now, I want to ask a question on the HealthCare.gov on the 
rollout. You know when it failed to launch, I led a group of 15 
Senators, calling on the Inspector General and GAO to conduct 
an independent investigation into the causes of the technical 
design and the implementation failures. And I was really 
pleased when the IG of the GAO agreed to conduct these 
investigations. I look forward to the reports when they come 
out later this summer or the fall.
    When you are confirmed, what lessons will you take from 
last year's site failure as you administer the next open 
enrollment period? And how can you improve the management of 
the HealthCare.gov?
    Ms. Burwell. With regard to the lessons from what happened 
in HealthCare.gov, a couple of things that, even in my role at 
OMB that we have examined and looked at. There are a number of 
things in thinking about IT procurement as well as delivery.
    One is you do not connect the business owner and the IT. 
That connection generally does not occur. It is a problem I 
have experienced in the private sector. People say to the IT 
team, ``Here. Fix it,'' versus an integrated approach of the 
business owner and the IT implementer working together.
    The second thing that I think is a problem--and the 
problems I am articulating are ones that we need to think about 
as the Federal Government and hold specifically in 
HealthCare.gov--generally in procurement, we have traditionally 
done a waterfall approach, a building approach. When one is 
doing information technology, a more iterative approach where 
one tests in small pieces and moves and learns, is a better 
approach to doing procurement, not set up to do that in terms 
of how we set standards and do expectations.
    The third thing that is an important part of IT procurement 
and delivery is ownership and accountability in terms of a 
single individual being the person that does that integrating 
of the individual on the IT side and the business side.
    Those are all three things that even right now at GSA, 3 
weeks ago, implemented some of the things that we think will 
improve ability of providers to get access and work in that 
way.
    Senator Hagan. Thank you.
    Thank you, Mr. Chairman.
    The Chairman. Thank you, Senator Hagan.
    Senator Whitehouse.

                    Statement of Senator Whitehouse

    Senator Whitehouse. Thank you, Chairman.
    Welcome, Ms. Burwell.
    In your summary of your very impressive career, you 
describe yourself as,

          ``Having had the opportunity to lead large and 
        complex organizations and work across a range of 
        issues. In each of my roles, I focused on building 
        strong teams, forging relationships, and delivering 
        results.''

    Has it been your experience in delivering those results 
that having solid, clear performance metrics is an advantage?
    Ms. Burwell. It is an advantage to know where you are 
headed.
    Senator Whitehouse. That is part of the accountability that 
you just described to Senator Hagan. Correct?
    Ms. Burwell. Yes. Knowing where you are headed and how you 
are going to measure whether you get there or not is an 
important part.
    Senator Whitehouse. So under the Affordable Care Act, I 
think we have made pretty significant progress on cleaning up 
some of the mess in the insurance market. Abuses like people 
being chucked off their policies or denied coverage because of 
a preexisting condition. That has been good.
    The access issue, I think, has been moved in a very, very 
good direction with 8 million people signed up.
    That leaves a third very, very big issue which is the cost 
of the system. A very well-regarded report came out recently 
that predicted that,

          ``Spending on healthcare, which already consumes 
        nearly 18 percent of the Nation's Gross Domestic 
        Product, will continue to grow 1.2 percentage points 
        faster than the economy over the next 20 years.''

    And a Brookings expert, rather punchily said this,

          ``If we cannot get healthcare spending under control, 
        there is no hope for the Federal budget. The main hope, 
        if we do not get health spending under control, is 
        global warming gets us all first before healthcare 
        spending gets us all.''

    So we can work on climate change separately, but there is a 
win-win opportunity to address the cost of healthcare by 
improving the quality of care. It has been identified by the 
President's Council of Economic Advisers. It has been 
identified by the Institute of Medicine. It has been identified 
by an array of private think tanks. And we proceed in that 
area, I believe, without adequate performance metrics.
    I would like to ask you your commitment, if you are 
confirmed, once you are confirmed, to work with me and work 
with a considerable number of other Senators who share this 
concern, to set some definable metrics for our progress at 
lowering the cost of healthcare by improving the quality and 
delivery of healthcare.
    Would you be willing to do that?
    Ms. Burwell. Senator, if I am confirmed, I look forward to 
working with you and a number of your other colleagues, 
actually, on both sides who have brought up this issue. And so, 
I would look forward to working with you on it.
    Senator Whitehouse. To actually get it done.
    Ms. Burwell. Senator, what I think the core objective is, 
is actually to improve the way we deliver healthcare to improve 
both quality, maintain and improve quality, and reduce cost, 
and that is what the objective would be.
    Senator Whitehouse. Do you agree that clear performance 
metrics would advance that objective?
    Ms. Burwell. I agree that metrics are an important part of 
that. I think one of the things that one wants to do is 
understand: what are the right metrics?
    In my experience in terms of when you are trying to scale 
and do change, you need to think about: what is the metric that 
you need to measure against?
    Senator Whitehouse. Exactly.
    Ms. Burwell. And so, determining that you can do that, is 
the other thing that I think is important. One, is it 
measurable? Is it the right measure? And then, can you scale 
against what you are trying to do? Those are the types of 
questions that I have historically considered when I think 
about the issue of metrics.
    Senator Whitehouse. Good. I look forward to working with 
you on these metrics.
    I think, just to give you a preview of coming attractions, 
I think there should be a cost savings metric, an actual dollar 
and a date that can be attributed to this process. And I think 
it might be helpful in getting to that goal and in articulating 
it for regular consumers that are to have a suite of 
subordinate metrics like, ``We are going to knockdown hospital-
wide infections by 80 percent by this date.'' ``We are going to 
have this many doctors moved off of fee-for-service and onto 
more outcome-based payment systems by this date.''
    And I think we can successfully build a good suite of 
performance metrics that will advance this, and I appreciate 
the attention of the committee to this. It has been something 
we have looked at repeatedly. It has been something I see 
Chairman Murray from the Budget Committee--we are looking at it 
very closely from a Budget Committee perspective.
    I concur with Mr. Gale, the senior fellow at the Brookings 
Institution, ``If we cannot get healthcare spending under 
control, there is no hope for the Federal budget.'' And there 
is a good way to get it under control without having to resort 
to just hacking away at fees, and eligibility, and what people 
are entitled to under their policy with the coverage.
    Thank you.
    The Chairman. I just have to add parenthetically, 75 
percent of all spending under Medicare is for chronic diseases, 
most of which are preventable. Do you want some measurable 
data? Look at that.
    And now, our own budget person, Senator Murray.

                      Statement of Senator Murray

    Senator Murray. Thank you, Mr. Chairman.
    I just have to say at the outset that I am really pleased 
that the President chose such a qualified, competent, and 
experienced nominee. Someone, obviously, I know very well.
    I have had the opportunity now to work very closely with 
Director Burwell for many years during her time as part of 
President Clinton's economic and budget team. Her distinguished 
service at the Gates Foundation, and her current position now, 
of course, as Director of the Office of Management and Budget. 
This is a very impressive record and I really applaud you. You 
have excelled at every step.
    Back in the Clinton administration, Mr. Chairman, she 
played a central role in crafting policies that helped lead to 
a very broad-based economic growth and budget surplus that we 
all remember by the end of the 1990s.
    In her Foundation work, she took on an entirely different 
challenge and managed a very successful organization with a 
global reach. And for the past year, as we all know, Director 
Burwell worked very successfully with us here in Congress to 
bring much needed bipartisanship back to the budget process. 
And at the same time, she was overseeing some critical programs 
from Medicare to the Affordable Care Act from a budget 
perspective.
    I really believe she has the necessary qualifications, and 
I am delighted to have just a few minutes here. I do not want 
to take much time, but I did want to say, take this opportunity 
and give us the chance to hear from you how your professional 
experience has really prepared you to meet the challenge of 
managing a very large agency with a lot of different, critical 
functions.
    Ms. Burwell. I think that my time at a number of different 
agencies that I have been in have really helped with a couple 
of things.
    One is that clarity of focus on impact, and I think that 
comes back to the conversation that we were just having with 
Senator Whitehouse, and how one needs to get in quickly, and 
make sure that you define very clearly what your goals are, and 
then build the institution, build the teams, empower those 
teams. And part of that empowering of those teams is making 
sure that they know what their roles are and what their 
responsibilities and accountabilities are.
    The other thing that I think is a particularly important 
part that I have learned in working in the foundations space 
and all the jobs that I had, when I think about the problem-
solving, you think about, what is the problem you are working 
on? What is the solution space is another circle. And then the 
third circle is--for whatever entity that you are, whether it 
is at Walmart, or at the Bill and Melinda Gates Foundation, or 
in the Federal Government--what is your institution best at? So 
you are applying the skills and what your part of the 
organization, the piece that you are working on or where you 
are best at.
    I have had the chance to work in a lot of private-public 
partnerships, both inside and outside the Government, and seen 
a number of different things. But I think, really, framing core 
roles, setting out, building good teams, and then empowering 
them to do the work are the most important things I have 
learned.
    Senator Murray. I am looking forward to seeing you do that 
at this agency.
    I did want to also mention that I am a very strong champion 
for early childhood education. There are several, key early 
learning programs, Head Start and the Child Care and 
Development Block Grant that will be within your purview at HHS 
if you are confirmed.
    I wanted to ask you how you are going to continue your 
agency's work to expand and strengthen those key Federal 
investments?
    Ms. Burwell. I think those are very important investments, 
as Senator Casey talked about, the issues of children. And I 
think that we have a start and the process that started with 
Murray-Ryan that led to Rogers-Mikulski, and that process has 
produced some of the funding that, I think, can jump start.
    We have proposals in the budget right now that are 
important parts of continuing on that, that try and build on 
existing distribution mechanisms, so you are not creating new 
systems. They build through Head Start and use other things, 
but make sure that the programs that are in place have quality 
measures.
    I am hopeful that we can work with--if I am confirmed, 
either in my OMB slot or at HHS--can work with the Congress on 
moving those issues of early childhood education forward. As 
you know, because I have a 6\1/2\-year-old and a 4\1/2\-year-
old, these are issues that I actually----
    Senator Murray. You live it.
    Ms. Burwell. I live it. I live it every day and I live that 
my children are so advantaged in everything they get. And how 
can we make that a reality for all of the children in this 
country so they have the tools to succeed?
    Senator Murray. All right. My time is out. We have a vote 
coming.
    But I wanted to mention that it was reported that the 
uninsured level is at its lowest point since January 2008 when 
Gallup first started tracking that. And is in States like my 
home State of Washington, that you know so well, where we built 
our own exchange and expanded Medicaid. The rate of uninsured 
is decreasing even faster where we have enrolled nearly 1 
million people for coverage.
    I am delighted by that and I hope that you use my State and 
your State how to really help replicate some of those good 
experiences across the country. And I look forward to working 
with you.
    [The prepared statement of Senator Murray follows.]

                  Prepared Statement of Senator Murray

    I'm pleased to support the President's nominee to lead the 
Department of Health and Human Services, Sylvia Mathews 
Burwell. The President has chosen a highly qualified, 
competent, and experienced public servant--and one that I know 
very well. I worked closely with Director Burwell for many 
years, during her time as part of President Clinton's economic 
and budget team, her distinguished service at the Gates 
Foundation, and her current position as director of the Office 
of Management and Budget. It's an impressive record, and she 
has excelled at every step.
    In the Clinton administration, she played a central role in 
crafting policies that led to broad-based economic growth and a 
budget surplus by the end of the 1990s. She served as Deputy 
Director of OMB, Deputy Chief of Staff to the President, and 
Chief of Staff to the Secretary of the Treasury--all positions 
with significant responsibility that required strong leadership 
and management skills.
    The Clinton administration's pro-growth, pro-middle-class 
economic policies were largely responsible for the economic 
expansion that helped so many families; businesses saw that 
Congress and the Administration were tackling budget challenges 
in a serious way, and investment and hiring rose as a result. 
Director Burwell was a primary architect of those successful 
policies.
    In her foundation work, she took on an entirely different 
challenge and managed successful nonprofit organizations with a 
global reach. At both the WalMart and Gates Foundations, she 
combined compassionate, mission-driven leadership with 
management expertise. As President of the Gates Foundation's 
Global Development Program and its Chief Operating Officer, she 
carefully conserved the foundation's resources while boldly 
expanding its global work. And most recently, as President of 
the WalMart Foundation, she focused on issues critical to our 
communities like hunger and women's economic empowerment, 
further demonstrating her commitment to service and leadership 
abilities.
    Over the past year, Director Burwell has worked as a 
partner with Congress to bring much-needed bipartisanship back 
to the budget process, while also overseeing the implementation 
of critical programs--from Medicare to the Affordable Care Act. 
She's had to make tough calls, work long hours, and manage a 
large staff--all experiences that will serve her well in 
managing such a large agency with so many critical functions.
    Her leadership skills and experience will help her continue 
the successful implementation of the Affordable Care Act. The 
uninsured rate is already at the lowest rate in years, and 
continues to drop. Over eight million Americans are signed up 
for comprehensive, affordable coverage, and millions more 
continue to sign up for Medicaid. Already, four new companies 
want to join the competition and sell health plans on our 
Exchange, Washington Healthplanfinder, which is good for the 
market and Washingtonians. More than 3.1 million young 
Americans are getting covered under their parents' plan, and 
7.9 million seniors have saved $9.9 billion on prescription 
drugs through Medicare--an average savings of $1,265 per 
person. With innovative States like my home State of Washington 
taking the lead, the law continues to be successfully 
implemented every day, and Americans are realizing tangible 
benefits.
    Director Burwell also knows the Department's important role 
in executing policies that will contain the rate of Medicare 
cost growth to ensure access to care for future generations. 
Successful implementation of payment and delivery system 
reforms that incentivize quality and efficiency over volume is 
crucial to improving and sustaining Medicare. Under Director 
Burwell's leadership, I am confident that the Department will 
continue to serve as a catalyst for advancements in patient 
care on the ground.
    As the work to improve quality of care continues, we must 
also continue to invest in innovation through biomedical and 
behavioral research. In Washington State, life sciences R&D is 
supported significantly by the National Institutes of Health 
(NIH)--Washington researchers have made progress in health and 
medical sciences and contributed to innovation across the 
globe. Just this week, economic findings were released on the 
Women's Health Initiative estrogen plus progestin trial, housed 
at the Fred Hutchinson Cancer Research Center in Seattle, 
indicated that changes in practice stemming from the trial 
provided a net economic return of over $37 billion, providing 
nearly a $140 return on every dollar invested. The trial also 
showed a decrease in breast cancer and fewer cardiovascular 
events for women, showing both the economic power of innovation 
investments, and the resulting improved health outcomes. 
Director Burwell's experiences at both the Gates and Walmart 
foundations make her well-equipped to lead the Department's 
efforts to further this work across the country.
    Director Burwell is just what the Department needs: a 
strong leader and manager. At her confirmation hearing last 
year for her current position, I said that she has the 
experience, integrity, and expertise necessary to succeed--I 
still believe that.

    Ms. Burwell. Thank you, Senator.
    The Chairman. Thank you, Senator Murray.
    Senator Sanders.

                      Statement of Senator Sanders

    Senator Sanders. Thank you very much, Mr. Chairman.
    And welcome, Ms. Burwell.
    Unlike Senator Roberts, I believe in a Medicare for all, 
single payer system. I think there is something wrong when, in 
our great country, we are the only Nation in the industrialized 
world that does not guarantee healthcare to all of its people. 
And yet, we end up spending far more than most other countries, 
without particularly good healthcare outcomes.
    In that regard, in the ACA legislation, I put language in--
supported strongly by Senator Harkin--that would give 
flexibility to States to move in different directions, 
including a single payer option. And, as you know, the State of 
Vermont intends to do that.
    Right now, we cannot do that until 2017. We have applied 
for a waiver. The President supports that waiver. Will you help 
the State of Vermont work with HHS to make sure that we can 
facilitate that process and give Vermont the opportunity to 
lead the Nation in that direction?
    Ms. Burwell. Senator, if I am confirmed, I look forward to 
working on that issue with you and the State.
    Senator Sanders. OK.
    There is another issue that is dear to my heart, and I know 
to Senator Harkin's heart. We have worked together on it, and 
to many people, and that is the crisis in primary healthcare 
and the need to go forward with community health centers.
    One of the reasons that I voted for the Affordable Care Act 
is that the majority leader, Senator Harkin, and I, and others 
worked very, very hard to substantially expand community health 
centers. In fact, in the last 4 or 5 years, I think we have 
added about 4 million more people access to primary care 
services through community health centers. In my State, about 
one-quarter of the people will get their primary healthcare 
through community health centers.
    We are in a difficult problem right now because we are 
facing a cliff in funding. As you know, as a result of the ACA 
funding, we were able to expand the number of community health 
centers. If that cliff goes into effect, it will be an absolute 
disaster. You and I have chatted about this on a number of 
occasions. You, working with the President, have provided a 
strong budget for community health centers and for the National 
Health Service Corps.
    Will you fight to make sure that we continue to strongly 
fund community health centers throughout America?
    Ms. Burwell. Senator, as you and I have had the opportunity 
to discuss, being from a rural place in the United States, I 
actually understand the role of community health centers in 
communities like the one I grew up in. And so, this is 
something that I believe is an important part of our system.
    I believe it is an important part in terms of prevention, a 
topic we have talked about, in terms of treatment as well. And 
I believe it actually is an important part of an efficient and 
effective healthcare in terms of cost.
    Senator Sanders. And that investment saves money. But here 
is my question, and stay with me, we are looking to support 
community health centers well into the future, and in fairness, 
the President and you have helped make his budget strong.
    But will you help us fight to make sure that we continue to 
have that funding and not go over that cliff, which would be a 
disaster for community health centers all over this country? Do 
I have your support on that?
    Ms. Burwell. Senator, you do. The budget that we put 
together is the first step in that process to do that.
    Senator Sanders. OK.
    In a related issue, we are not going to have strong 
community health centers or strong primary care in this country 
unless we have the physicians, and the nurses, and the other 
staff that we need.
    To my mind, also in the ACA and working with Senator Harkin 
and others, we tripled funding for the National Health Service 
Corps. And people said, ``Well, that is a whole lot of money.'' 
Well, you know what? It is still not enough because I think as 
you understand--and correct me if I am wrong--we face a crisis 
in terms of the number of physicians and other healthcare 
providers that we have getting out to underserved areas in 
America.
    Will you work with some of us--with myself, Senator Harkin 
and others--to make sure that we adequately fund the National 
Health Service Corps to do loan repayment or scholarships for 
health professional students who want to practice in 
underserved areas?
    Ms. Burwell. The issue of primary care in underserved areas 
is one that, throughout the budget, you see support for. And 
whether that it is in the issue that you just raised in terms 
of the National Health Corps, it is also in how we think about 
not just physicians, but there are also provisions that are 
about nurses and other people that are part of the primary care 
system.
    Senator Sanders. That is exactly correct.
    Ms. Burwell. I think that is another important piece that 
we need to work on.
    Senator Sanders. Thank you and I agree with you. What I 
also worry about is the expiration of a very important program 
called the Teaching Health Center Graduate Medical Education 
program. That is a program which allows doctors and dentists to 
get their residency training in community health centers, et 
cetera.
    Are you familiar with that program?
    Ms. Burwell. The Graduate Medical Education program, yes.
    Senator Sanders. Yes. OK. It may expire. Will you work with 
me to see that it does not expire?
    Ms. Burwell. I want to make sure that the Graduate Medical 
Education program, there are a number of provisions that are 
attempting to improve and make sure that they focus on what you 
just articulated, primary care and where there are shortages in 
specialties.
    That is something that is a part of the budget and a series 
of bringing pieces together that include how we think about the 
National Health Service Corps as well.
    And so, yes, that is something that is part of the budget 
process I have worked on, and would look forward to working, if 
confirmed, in a new role.
    Senator Sanders. Thank you very much.
    The Chairman. Thank you very much, Senator Sanders.
    Senator Scott, have you voted already?
    Senator Scott. Yes, sir.
    The Chairman. Did you vote on the floor?
    Senator Scott. Yes, sir.
    The Chairman. We are down to about, well, maybe 3 or 4 
minutes left now, but I will recognize you, but we are close to 
being out. We have four or five votes, right?
    Senator Scott. Yes, sir.
    The Chairman. Senator Scott, go ahead, but we are going to 
have to be very short.

                       Statement of Senator Scott

    Senator Scott. Sir, I will not take more than 5 minutes, I 
promise. The Senate time allows for 15 or 10 minutes to vote, 
but it also takes about 30 minutes to count 15 minutes in 
Washington. It is part of that fuzzy math that happens all the 
time here in Washington, which really is one of the questions I 
will be asking you about, Director Burwell.
    One of the questions will be the fuzzy math that seems to 
be a part of Obamacare. The other one will be about the 
promises made, promises not kept. And finally, whether you will 
be the Ambassador of Obamacare or whether you will be the 
Secretary of Health and Human Services.
    I will say that I enjoyed our meeting together and 
certainly you come before us with a great reputation. I voted 
for you for OMB. My good friends, men like Trey Gowdy, have 
great respect for your intellect and your integrity. And so, I 
will take that into serious consideration.
    My questions will focus specifically on Obamacare and the 
dismal rollout that we have seen, and the challenges that I 
have with the numbers. And hopefully, you will be able to bring 
some clarity and answer just a couple of questions as we rush 
to make sure that we make the last vote here.
    The numbers, fuzzy Washington math, the $1.4 trillion price 
tag between now and 2015-24. The fact that after spending 
nearly $1.5 trillion, we will still have 31 million Americans 
uninsured by 2024. The fact that the ACA has siphoned about 
$716 billion from Medicare, and somehow that is supposed to 
improve the outcome of our seniors.
    Perhaps one of the more frustrating numbers that I have 
seen in Obamacare's number is 8 million people have signed up 
for Obamacare. One of my questions will be at the end, how, 
pray tell, do we account for 8 million people signing up for a 
program, but they do not pay their premium, yet we count that 
number as a part of a true number that reflects the number of 
Americans that are actually eligible for health insurance if 
they do not pay their premium.
    It seems to me that the number 8 million people signed up 
for Obamacare, when you multiply that by the 80 percent who 
have actually paid, it brings that number down significantly.
    And then when you drill into the numbers of those folks who 
have signed up for Obamacare and recognize that about 28 
percent of those folks who have actually paid their premium 
represent those under the age of 35. And that brings into 
question the whole notion of the actuarially sound premise that 
we need about 2.8 million young folks buying into a program 
that they will, hopefully, not have to use in order to avoid 
adverse risk selection.
    Having spent a couple of years in the insurance industry 
myself, I find that those who sign up but do not pay premiums 
do not have coverage. That does not seem to be taken into 
consideration as we talk about the success of Obamacare. I 
would love to hear your perspective on that.
    As I think about that, I will simply ask the first 
question, if confirmed as our Health and Human Services 
Secretary, will you be willing to be clear and honest with the 
American people, the Congress, and this committee about the 
implementation of Obamacare regardless of what the 
Administration's policy is?
    You mentioned during our time that you have a lot of 
experience served on MetLife Board and others. It would be 
helpful for the American people to have a clear picture of what 
is, in fact, happening with Obamacare since we now are 
relegated to getting our accurate information from ``The New 
York Times'' and the ``Washington Post,'' and not from HHS.
    Ms. Burwell. Senator, you have my commitment that if I am 
confirmed, the two pieces of principles that will guide me with 
regard to information are transparency and accuracy.
    Those are the two things, and I will work to do that in due 
course in terms of speed as well.
    Senator Scott. Thank you, ma'am.
    On the issue of promises made, promises not kept, I think 
about the fact that many Americans were promised this notion 
that if you like your insurance, you can keep it; that promise 
has been broken. If you like your doctor, you can keep your 
doctor; that promise has been broken. If you are looking for 
affordable healthcare, the ACA is the way to go; that promise 
seems to be challenged when you think of the actual cost and 
the price of health insurance. The cost being higher 
deductibles, higher out-of-pocket expenses, a more limited 
number of doctors to choose from, and fewer hospitals in the 
system, and even fewer specialists.
    So the actual cost of healthcare, I think, we will see it 
rise as we see the price tag is not affordable to more than 50 
percent of the folks who are eligible for Obamacare not signing 
up simply because they say they cannot afford it.
    Then having a functioning Web site, well, we know how that 
has worked out. The most challenging part that I see from a 
backdoor perspective on the Web site is that the insurers 
themselves are complaining that the backdoor operations are 
simply not set up yet.
    So while we celebrate the success of the healthcare 
exchange and the HealthCare.gov, obviously, if you cannot get 
the inner workings pinned down on the backend, it is really 
hard to pay claims and do those things that are necessary for 
the insurers.
    I would ask you simply as Secretary of HHS, will you, in 
fact, be the Health and Human Services Secretary for the 
American people or will you be, as your predecessor has been, 
the Ambassador of Obamacare?
    Ms. Burwell. Senator, in my current role at OMB, and if I 
am confirmed in this other role, it is my objective, and as I 
have talked about in my opening statement, I am here to serve 
the American people.
    I am part of the President's administration. I am honored 
to be appointed; first and foremost, I serve the American 
people. I believe the President and his policies are aligned 
with that and will work. But I am here to serve the American 
people.
    Senator Scott. Thank you.
    The Chairman. Thank you, Senator Scott.
    I would just say, that I must say, that it is my opinion, 
based upon the years of work with Kathleen Sebelius, Secretary 
Sebelius, that she performed her job admirably, and that she 
was a responsible and attentive Secretary of Health and Human 
Services, and carried out the law as we wrote it.
    I have two; I have a statement of support from Mary Kay 
Henry, president of the Service Employees International Union. 
And I also have a letter from the American Public Health 
Association, Georges C. Benjamin, executive director, I would 
like to include in the record.
    [The information referred to may be found in additional 
material.]
    I request that the record be kept open for 10 days for 
Senators' statements, and that the record stay open until close 
of business on Monday, for questions for the record.
    Ms. Burwell, again, thank you very much for your 
outstanding public service through all of your adult life. I 
thank you for your willingness to take on this very important 
task. We look forward to your very speedy vote and approval, 
and look forward to working with you as the new Secretary of 
Health and Human Services.
    Ms. Burwell. Mr. Chairman, thank you.
    The Chairman. Thank you.
    [Additional material follows.]

                          ADDITIONAL MATERIAL

                    Statement and Letters of Support

                      [www.seiu.org, May 6, 2014]

SEIU President: OMB Director Sylvia Burwell Uniquely Qualified For This 
                   Pivotal Moment In U.S. Healthcare

                  Contact: Diane Minor (202) 431-1445

           congress should not ``sully'' burwell's nomination
    Washington, DC--Mary Kay Henry, president of the Service Employees 
International Union, offered this statement about Thursday's hearing on 
Office of Management and Budget Director (OMB) Sylvia Mathews Burwell's 
nomination to serve as the next secretary of Health and Human Services 
(HHS), which will be the subject of a hearing by the Senate Health, 
Education, Labor, and Pensions Committee (HELP):

          ``With her many years of work on both domestic and global 
        healthcare priorities, OMB Director Burwell is uniquely 
        qualified to be a champion for the central role that quality, 
        affordable healthcare plays in the everyday lives and 
        aspirations of working people.
          ``The role of health secretary is a crucial one at this 
        pivotal moment of transition--in terms of the Affordable Care 
        Act and especially its Medicaid coverage that far too many 
        States are still denying their citizens. We urge Congress not 
        to sully Burwell's nomination with political attacks that could 
        hurt real people if they succeed in the long run.
          ``Millions of hard-working Americans will benefit from 
        Burwell's leadership and extensive management experience when 
        she becomes director of HHS, the Federal agency most involved 
        with our Nation's vital health services, the Affordable Care 
        Act, Medicaid and Medicare.
          ``We support Sylvia Mathews Burwell as the next leader of HHS 
        and look forward to partnering with her in delivering on the 
        promise that the healthcare law holds for all Americans, and 
        especially for people who are uninsured or who have pre-
        existing conditions.''

    The Service Employees International Union (SEIU) unites 2.1 million 
diverse members in the United States, Canada and Puerto Rico. SEIU 
members working in the healthcare industry, public sector and in 
property services believe in the power of joining together on the job 
to win higher wages, benefits and create better communities, while 
fighting for a more just society and an economy that works for all of 
us, not just corporations and the wealthy.
                                 ______
                                 
           America's Health Insurance Plans (AHIP),
                                      Washington, DC 20004,
                                                       May 7, 2014.
Hon. Tom Harkin, Chairman,
Senate Committee on Health, Education, Labor, and Pensions,
428 Dirksen Building,
Washington, DC 20510.

Hon. Lamar Alexander, Ranking Member,
Senate Committee on Health, Education, Labor, and Pensions,
835 Hart Building,
Washington, DC 20510.

    Dear Chairman Harkin and Ranking Member Alexander: On behalf of 
America's Health Insurance Plans (AHIP), I am writing to express our 
support for the nomination of Sylvia Mathews Burwell to serve as 
Secretary of Health and Human Services (HHS).
    As we move forward with implementation of the Affordable Care Act, 
Ms. Burwell's distinguished leadership and her notable experience in 
both the private and public sectors make her uniquely qualified to lead 
HHS during this critical time. She has a strong track record as a 
thoughtful and effective manager who can work with leaders across the 
political aisle. As health plans prepare for open enrollment for 2015, 
we look forward to working with her on quality, safety, and 
affordability issues.
    Thank you for considering our support for the Burwell nomination.
            Sincerely,
                                             Karen Ignagni,
                                                 President and CEO.
                                 ______
                                 
         American Public Health Association (APHA),
                                  Washington, DC 2001-3710,
                                                       May 7, 2014.
Hon. Tom Harkin, Chairman,
U.S. Senate Committee on Health, Education, Labor, & Pensions,
Washington, DC 20510.

Hon. Lamar Alexander, Ranking Member,
U.S. Senate Committee on Health, Education, Labor, & Pensions,
Washington, DC 20510.

Hon. Ron Wyden, Chairman,
U.S. Senate Committee on Finance,
Washington, DC 20510.

Hon. Orrin G. Hatch, Ranking Member,
U.S. Senate Committee on Finance,
Washington, DC 20510.

    Dear Chairmen Harkin and Wyden and Ranking Members Alexander and 
Hatch: On behalf of the American Public Health Association, a diverse 
community of public health professionals who champion the health of all 
people and communities, I write to urge the swift confirmation of 
Sylvia Mathews Burwell as the Secretary of the U.S. Department of 
Health and Human Services. Ms. Burwell has vast experience in both 
government and the private sector, making her a unique and highly 
qualified candidate for this important position.
    As Secretary, Ms. Burwell would oversee a vast network of critical 
public health and health care agencies and programs. These agencies 
play a vital role in protecting and improving the health and safety of 
the American public.
    Ms. Burwell has a strong history of proven leadership, most 
recently in her role as the director of the Office of Management and 
Budget, as well as through her tenure as the chief financial officer at 
the Gates Foundation and her other previous government and private 
sector service. We believe her experience and qualifications will allow 
her to successfully lead the department and ensure HHS and its agencies 
work to reduce the toll of chronic and infectious disease, strengthen 
our public health system and workforce and expand access to quality and 
affordable health care.
    We strongly endorse Ms. Burwell's nomination and urge the Senate 
Health, Education, Labor, and Pensions Committee and the Senate Finance 
Committee to swiftly approve her nomination.
            Sincerely,
                                 Georges C. Benjamin, M.D.,
                                                Executive Director.
                                 ______
                                 
   Nursing Organizations Urge Confirmation of Sylvia Mathews Burwell 
                            as HHS Secretary
    To Whom It May Concern: On behalf of the 32 undersigned national 
nursing organizations representing nursing education, practice, and 
research, we support President Obama's nomination of White House Office 
of Management and Budget (OMB) Director Sylvia Mathews Burwell for 
Secretary of the Department of Health and Human Services (HHS), and 
urge the Senate's confirmation of Ms. Burwell for this position. If you 
have any questions, please do not hesitate to contact me.
            Sincerely,
                               Suzanne Miyamoto, Ph.D., RN,
                  Director of Government Affairs and Health Policy,
                       American Association of Colleges of Nursing.

    Academy of Medical-Surgical Nurses; American Academy of Ambulatory 
Care Nursing; American Academy of Nursing; American Assembly for Men in 
Nursing; American Association of Colleges of Nursing; American 
Association of Nurse Anesthetists; American Association of Nurse 
Assessment Coordination; American Association of Nurse Practitioners; 
American Association of Critical-Care Nurses; American College of 
Nurse-Midwives; American Nephrology Nurses' Association; American 
Nurses Association; American Organization of Nurse Executives; American 
Pediatric Surgical Nurses Association; American Society for Pain 
Management Nursing; Association of Nurses in AIDS Care; Association of 
periOperative Registered Nurses; Association of Women's Health, 
Obstetric and Neonatal Nurses; Developmental Disabilities Nurses 
Association; Gerontological Advanced Practice Nurses Association; 
Infusion Nurses Society; International Society of Psychiatric Nursing; 
National American Arab Nurses Association; National Association of 
Clinical Nurse Specialists; National Association of Hispanic Nurses; 
National Association of School Nurses; National Nursing Centers 
Consortium; National Organization for Associate Degree Nursing; Nurses 
Organization of Veterans Affairs; Oncology Nursing Society; Society of 
Urologic Nurses and Associates; and Wound, Ostomy and Continence Nurses 
Society.

                                                     GAO Recorded Data on Premiums in Alaska in 2013
                                                                   (compared to 2014)
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                     GAO 2013 rates                      2013 Premera rates                2014 Premera exchange rates
                                           -------------------------------------------------------------------------------------------------------------
               Consumer Type                 GAO 2013   GAO 2013   GAO 2013
                                             Minimum     Medium    Maximum     Access   Safeguard     Peak       Peak      Bronze     Silver   Gold plus
                                             premium    premium    premium      plan      5,000      $2,500     $1,000      plus       plus
--------------------------------------------------------------------------------------------------------------------------------------------------------
Single male, nonsmoker, age 64
    Premium amount ($)....................      5,062      8,667     19,908      6,300      7,392     14,868     19,908     10,872     13,284     14,580
  Annual deductible ($)...................      5,000      5,000      1,000     10,000      5,000      2,500      1,000      5,500      2,000      1,000
  OOP max ($).............................      5,000      7,000      4,000                                                  6,350      6,350      4,500
  Coinsurance (%).........................          0         20         20                                                     20         20         20
Single male, smoker, age 64
    Premium amount ($)....................      5,822      9,967     22,908      7,548      8,484     17,100     22,908     11,664     14,292     15,696
  Annual deductible ($)...................      5,000      5,000      1,000     10,000      5,000      2,500      1,000      5,500      2,000      1,000
  OOP max ($).............................      5,000      7,000      4,000                                                  6,350      6,350      4,500
  Coinsurance (%).........................          0         20         20                                                     20         20         20
Single female, nonsmoker, age 64
    Premium amount ($)....................      4,849      8,312     17,640      5,796      6,552     13,176     17,640     10,872     13,284     14,580
  Annual deductible ($)...................      5,000      5,000      1,000     10,000      5,000      2,500      1,000      5,500      2,000      1,000
  OOP max ($).............................      5,000      7,000      4,000                                                  6,350      6,350      4,500
  Coinsurance (%).........................          0         20         20                                                     20         20         20
Single female, smoker, age 64
    Premium amount ($)....................      5,576      9,559     20,328      6,684      7,548     15,180     20,328     11,664     14,292     15,696
  Annual deductible ($)...................      5,000      5,000      1,000     10,000      5,000      2,500      1,000      5,500      2,000      1,000
  OOP max ($).............................      5,000      7,000      4,000                                                  6,350      6,350      4,500
  Coinsurance (%).........................          0         20         20                                                     20         20         20
Male/FM Smoker/NS, age 19
    Premium amount ($)....................        911      1,635      4,128      1,296      1,512      3,060      4,128      2,304      2,808      3,084
  Annual deductible ($)...................      5,000      1,500      1,000     10,000      5,000      2,500      1,000      5,500      2,000      1,000
  OOP max ($).............................      5,000      5,150      4,000                                                  6,350      6,350      4,500
  Coinsurance (%).........................          0         20         20                                                     20         20         20
--------------------------------------------------------------------------------------------------------------------------------------------------------

  Response by Sylvia Mathews Burwell to Questions of Senators Casey, 
   Hagan, Franken, Warren, Baldwin, Bennet, Murphy, Alexander, Enzi, 
               Isakson, Kirk, Murkowski, Burr, and Hatch
                             senator casey

Administration on Aging

    Question 1. Pennsylvania is home to two million adults over the age 
of 65, many of whom are supported by local programs. These programs, 
such as congregate and home delivered meals, health promotion and 
disease prevention activities, and various supportive services, receive 
Federal funding from the Administration on Aging to assist a large 
number of older adults who are not quite poor enough to be Medicaid 
eligible.
    With the number of older adults expected to double by 2050, we are 
at a critical point in addressing the needs of America's older 
population. As Secretary, what steps will you take to ensure that the 
needs of our vulnerable older adults are met in a manner that 
recognizes the strengths of the local aging network while also 
maximizing efficiencies at the Federal level?
    Answer 1. If confirmed, I will continue to strengthen the robust 
collaboration with the National Aging Services Network--State and area 
agencies on aging, local service providers and the hundreds of 
thousands of volunteers--who dedicate their time and resources each day 
to assist older Americans live healthy and independent lives with 
dignity under the Older Americans Act. This Act and its network has 
provided 50 years of successful service as a complement to Medicare and 
Medicaid as a home and community-based person-centered program that 
lends a hand to the those most in need and provides information and 
services to those who seek assistance in the community. Given the 
demographic shift noted in your question, the importance of these 
partnerships and of strong coordination across a range of HHS agencies 
will be a priority.

BPCIA Implementation

    Question 2. In the 4 years since the Biologic Price Competition and 
Innovation Act (BPCIA) was enacted, FDA has held only two public 
meetings and issued only three draft guidance documents on substantive 
BPCIA topics. I am concerned about the apparent lack of transparency 
about the agency's plans for implementation and how it intends to 
resolve key outstanding issues. Would you provide a brief outline of 
the FDA's plans for implementation of BPCIA?
    Answer 2. I take the issue of transparency very seriously and, if 
confirmed, would work to ensure ongoing access to information about 
FDA's approach to the Biologic Price Competition and Innovation Act 
(BPCIA) and other programs. While I have not been engaged on this issue 
in my role as OMB Director, my understanding from HHS is that to date, 
FDA has held two public hearings and issued four draft guidances on 
implementation of the BPCIA. The November 2010 public hearing provided 
a forum for interested stakeholders to provide input regarding the 
agency's implementation of the BPCI Act. FDA held a second public 
hearing in May 2012 to receive input on these guidances and in 
obtaining public input regarding the Agency's priorities for 
development of future policies regarding biosimilars. FDA will take 
into consideration all received comments as we move forward in 
finalizing the four draft guidance documents and developing future 
policies regarding biosimilar products and interchangeable products.
    In the Center for Drug Evaluation and Research (CDER) and CDER's 
Guidance Agenda for 2014, FDA listed a number of draft guidances 
related to biosimilars that are under development. The public will be 
provided with an opportunity to comment on these new guidances. HHS 
continues to actively engage with prospective biosimilar sponsors, 
including holding development-phase meetings and providing written 
advice on ongoing development programs for proposed biosimilar 
products. FDA has seen a high level of interest in the biosimilars 
program and it is an area of focus for the agency.

Project BioShield Funding

    Question 3. Last year, this committee reauthorized the Pandemic and 
All-Hazards Preparedness Act (PAHPRA), including the Project BioShield 
Special Reserve Fund (SRF) at $2.8 billion over 5 years. The 
availability of dedicated Special Reserve Fund (SRF) procurement 
funding over the last 10 years has allowed the U.S. government to 
attract the pharmaceutical and biotechnology companies that are now 
delivering essential medical countermeasures to our national stockpile. 
I am concerned that the President's fiscal year 2015 budget proposes 
less than one-fifth of the $2.8 billion, 5-year authorization.
    Do you believe that the $415 million proposed in the fiscal year 
2015 budget is sufficient to ensure that the SRF is able to remain on 
track with its procurement goals over the remainder of the 
authorization? What was the rationale for proposing this amount of 
funding for fiscal year 2015?
    Answer 3. The tight discretionary budget caps currently in place 
require tough choices and close examination of the appropriate funding 
levels for key priorities such as biodefense. The Administration is 
committed to providing the funds needed in the second phase of Project 
BioShield to develop and procure an additional 12 medical 
countermeasures (MCM) on top of the 12 MCMs procured since 2004. The 
fiscal year 2015 request, like last year's request, is tailored to 
reflect the MCMs that are mature enough for HHS/Assistant Secretary for 
Preparedness and Response/Biomedical Advanced Research and Development 
Authority to procure under Project BioShield in 2015 on the way toward 
meeting the 5-year goal.
    Critical to the continued success of Project BioShield is sustained 
funding for BARDA Advanced Research and Development (ARD). The fiscal 
year 2015 request of $415 million will allow BARDA to maintain the 
robust portfolio of candidate MCMs and allow for new starts if current 
programs are down-selected due to the sponsors' inability to show 
safety or efficacy.

    Question 4. As you know, Congress directed the Centers for Medicare 
and Medicaid Services to address improper payments under Medicare 
through the use of recovery auditors. The current contracts are set to 
expire on June 1, and new contracts have not yet been awarded.
    When does CMS expect to award the new contracts?
    Answer 4. As OMB Director, I have not been involved in this or any 
other procurement process at HHS. However, I have been told by HHS 
staff that CMS is currently in the procurement process for the next 
round of Recovery Audit Program contracts and plans to award these 
contracts this year.
                             senator hagan
    Question. Director Burwell, I understand that the FDA has proposed 
a rule that would eliminate the use of paper package inserts for 
prescription drugs and require the exclusive use of electronic labels 
instead. The rule has been under review by the Office of Information 
and Regulatory Affairs (OIRA) since August of last year. I commend OMB 
for giving this issue the due diligence it deserves. This labeling 
includes all of the important information that healthcare professionals 
and patients need to safely take their prescription drugs.
    Last July, GAO released a report finding that there was ``no 
consensus among stakeholders on the advantages and disadvantages of 
eliminating paper labeling.'' The disadvantages GAO noted include: (1) 
adversely impacting public health by limiting the availability of drug 
labeling for some providers, and (2) a lack of reliable, unbiased 
sources of information to support an electronic label.
    Do you agree that this important information should be available at 
all times?
    Do you agree that there is a risk that such information may not be 
available to all users electronically in technology-limited situations 
such as in rural areas or following a natural disaster?
    Answer. As you note in your question, this proposed rule is 
currently under OMB review under Executive Order 12866. It is OMB's 
longstanding policy not to comment on rules under review. That said, we 
would welcome you or your staff to come in and share your views on the 
rulemaking with us, and updated information on the status of any review 
can be monitored at: www.reginfo.gov. As a general matter, I think it 
is very important that the benefits of rules justify their costs, and 
that public input plays an important role in that determination.
                            senator franken
    Question 1. In your written testimony, you refer to the work of the 
experts at the National Institutes of Health (NIH) and the Centers for 
Disease Control and Prevention (CDC) to find cures for the most serious 
diseases and to prevent them from spreading. One important example of 
this work is the National Diabetes Prevention Program (NDPP). This 
lifestyle intervention program for those with a high risk of developing 
type 2 diabetes began as a successful NIH clinical trial, and was pilot 
tested by the CDC in St. Paul, MN and Indianapolis, IN. Based on this 
successful research, I developed legislation with Senator Lugar from 
Indiana to establish a grant program at the CDC to help community-based 
organizations offer this evidence-based program across the country. Our 
legislation, the Diabetes Prevention Act, passed as part of the 
Affordable Care Act and has received $10 million in appropriations 
every year since then.
    This program can and should be further expanded. While private 
insurers including UnitedHealthcare are beginning to cover this program 
for their beneficiaries, the Medicare program does not provide the 
program for pre-diabetic seniors. I heard from the CEO that 
UnitedHealthcare saves $4 for every dollar it spends on this program. 
That's because the Diabetes Prevention Program keeps beneficiaries 
healthy and prevents them from needing expensive treatments. This is 
exactly the kind of cost-effective preventive health care we want all 
insurers to cover--including Medicare. I introduced legislation, the 
Medicare Diabetes Prevention Act, along with Senators Susan Collins and 
Jay Rockefeller, to do just that. If passed, the Medicare Diabetes 
Prevention Act would provide the NDPP as a covered benefit to 
clinically eligible Medicare beneficiaries.
    Providing the NDPP through Medicare would help seniors stay healthy 
while making the Medicare program more efficient and saving taxpayers 
money. If you are confirmed as HHS Secretary, what specific steps will 
you take to give seniors access to the National Diabetes Program?
    Answer 1. Diabetes is a serious chronic illness that has and will 
continue to be a priority for HHS. My understanding is that HHS is 
working to address diabetes and other chronic conditions in a number of 
ways, including through Medicare's annual wellness visit, which 
provides beneficiaries with personalized prevention plan services at no 
cost. Such visits are crucial to the early detection and successful 
management of chronic conditions like diabetes.
    Through the Health Care Innovation Awards, the Center for Medicare 
and Medicaid Innovation is already testing on a large scale an 
intervention for diabetes prevention approaches in pre-diabetic 
Medicare beneficiaries. The goal is to prevent the progression of pre-
diabetes to diabetes, which will improve health and decrease costs 
associated with complications of diabetes. If the project is successful 
at reducing Medicare expenditures while enhancing or maintaining 
quality, it could help inform future Medicare payment policy.

    Question 2. Under current law, the Secretary of HHS is prohibited 
from negotiating drug prices with pharmaceutical manufacturers on 
behalf of seniors in Medicare. This prohibition wastes billions of 
taxpayer dollars every year and raises prescription drug costs for 
seniors for the sole purpose of increasing profits for drug companies. 
I have legislation, the Prescription Drug and Health Improvement Act, 
to remove this ban and allow the Secretary of HHS to negotiate directly 
with drug companies to get the best price on prescription drugs for 
seniors. This is a commonsense way to reduce spending in Medicare and 
improve access to treatments for seniors.
    While I understand that the Obama administration does not have an 
official position on my legislation, the administration has strongly 
supported other measures to increase efficiency for the Medicare 
program and reduce costs for seniors. For example, a provision in the 
Affordable Care Act to close the so-called ``donut hole'' or coverage 
gap in the Medicare Part D program has saved seniors billions of 
dollars on their prescription drugs, and has been touted as a 
significant success.
    How does reducing drug costs for seniors and improving the 
efficiency of the Medicare program help Medicare beneficiaries and 
American taxpayers?
    If the Secretary were permitted to negotiate drug prices with 
pharmaceutical companies, how do you think this would benefit seniors 
in the Medicare program?
    Answer 2. Lower drug prices can help save money for both Medicare 
beneficiaries and taxpayers, which is why the Administration has 
supported initiatives to this end. The Affordable Care Act took a 
number of steps to lower drug prices. It strengthened the Medicaid 
rebate and 340B programs. Additionally, beneficiaries in the Medicare 
Part D coverage gap currently receive a 50 percent discount from 
pharmaceutical manufacturers on their brand drugs. The Affordable Care 
Act closes this gap by 2020 through a combination of manufacturer 
discounts and Federal subsidies. The President's fiscal year 2015 
Budget proposes to increase manufacturer discounts to 75 percent 
beginning in plan year 2016, effectively closing the coverage gap for 
brand drugs in 2016. The phase-out for generic drugs would continue 
through 2020. This proposal would reduce prescription drug costs for 
beneficiaries and save $7.9 billion over 10 years.
    To help improve the efficiency of the Medicare prescription drug 
benefits, the President's fiscal year 2015 Budget contains proposals to 
reduce costs on prescription drugs for both the Medicare program and 
beneficiaries, by aligning Medicare drug payment policies with Medicaid 
policies for low-income beneficiaries and accelerating manufacturer 
drug discounts to more rapidly close the Part D coverage gap.
    Currently, drug manufacturers are required to pay specified rebates 
for drugs dispensed to Medicaid beneficiaries. In contrast, Medicare 
Part D plan sponsors negotiate with manufacturers to obtain plan-
specific rebates at unspecified levels. Analysis has found substantial 
differences in rebate amounts and prices paid for brand name drugs 
under the two programs, with Medicare receiving significantly lower 
rebates and paying higher prices than Medicaid. Prior to the 
establishment of Medicare Part D, manufacturers paid Medicaid rebates 
for drugs provided to the dual eligible population. The President's 
fiscal year 2015 Budget proposes to align these policies to allow 
Medicare to benefit from the same rebates that Medicaid receives for 
brand name and generic drugs provided to beneficiaries who receive the 
Part D Low-Income Subsidy, beginning in 2016. The proposal would 
require manufacturers to pay the difference between rebate levels they 
already provide Part D plans and the Medicaid rebate levels. 
Manufacturers would also be required to provide an additional rebate 
for brand name and generic drugs whose prices grow faster than 
inflation. This proposal would save $117.3 billion for the Part D 
program over 10 years.

    Question 3a. As you noted in your testimony, the rollout of 
healthcare.gov was unacceptable. There was a real failure in leadership 
around the launch of the Web site and a lack of accountability for it.
    What do you think are the most important lessons learned from this 
rollout, and how do they affect your views about how information 
technology projects are managed and developed within the Federal 
Government and, specifically, the Department of Health and Human 
Services?
    Answer 3a. The Administration has been clear that the rollout of 
HealthCare.gov was unacceptable. There are several important lessons 
learned from this experience that can be used, where appropriate, to 
improve Information Technology (IT) development and procurement in the 
Department and across the Federal Government. Ownership and 
accountability are critically important in the IT procurement and 
delivery process; it is important to have a single entity serve as an 
integrator for both the business and IT sides of a project--ensuring 
that the business owner and IT developer are connected throughout the 
process. Finally, the Federal Government may need to adopt more 
iterative approaches to procurement, like IT itself, that would allow 
projects to be tested and developed in stages. If confirmed, I would 
work to translate these lessons into better outcomes and impact at HHS.

    Question 3b. What are you doing to support State-based 
marketplaces, including Minnesota's marketplace, MNsure, that have 
faced technical challenges when interacting with the federally 
facilitated marketplace?
    Answer 3b. I understand that CMS has given States flexibility in 
setting up their Marketplaces and is working closely with them. CMS 
communicates frequently with State-based Marketplaces and is providing 
both oversight as well as technical assistance. I will ensure that this 
proactive approach is continued if I am confirmed.

    Question 4. One of my top priorities as a Senator has been to 
expand access to mental health care for everyone who needs it, 
particularly children. I hold Paul Wellstone's seat in the Senate, and 
among my first actions as a Senator was to urge the Obama 
administration to fully implement the Paul Wellstone and Pete Domenici 
Mental Health Parity and Addiction Equity Act of 2008. Finally, in the 
fall of last year, 5 years after the bill was passed, the 
Administration released final rules to implement the law. However, 
those rules do not apply to Medicaid-managed care or alternative 
benefit plans, or to plans under the State Children's Health Insurance 
(CHIP) program. Instead, the rules indicate that HHS will provide 
further guidance to States on how to apply parity to these important 
plans. To date, HHS has not yet released any further guidance.
    If you are confirmed as Secretary of HHS, will you commit to 
issuing this guidance, which will clarify the application of the final 
rules to Medicaid and CHIP plans, before the end of this year?
    Answer 4. Mental Health Parity is a priority for the 
Administration. However, I have not been engaged in the specific issue 
that you raise in my capacity as OMB Director and look forward to 
learning more if confirmed. My understanding from HHS is that in 
January 2013, the Centers for Medicare & Medicaid Services (CMS) issued 
a State Health Official (SHO) letter to provide guidance to States 
regarding the application of the Paul Wellstone and Pete Domenici 
Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA) in 
Medicaid and to expand upon the guidance for CHIP. In this guidance, 
CMS detailed that all Medicaid Alternative Benefit Plans (ABPs) 
(including benchmark equivalent and Secretary--approved benchmark 
plans) are required to meet the provisions within MHPAEA, regardless of 
whether services are delivered in managed care or non-managed care 
arrangements. If confirmed, I will ensure that CMS continues to 
consider additional regulatory changes that may be necessary to 
properly implement MHPAEA.
    Additional guidance regarding MHPAEA's application to Medicaid is a 
priority and if confirmed, I will ensure that CMS assists States in 
implementing these requirements.

    Question 5. My home State of Minnesota provides among the best 
health care in the country. The Agency for Healthcare Research and 
Quality within HHS rated Minnesota as having the highest quality health 
care in the Nation, and the nonpartisan Commonwealth Fund found that 
Minnesota's health systems have the best performance in the country.
    Unfortunately, because of the way that providers are reimbursed 
through Medicare, Minnesota's providers and health systems are 
penalized rather than rewarded for our high-quality, low-cost health 
care.
    If confirmed, what specific steps would you take to reward 
providers and health systems for providing high-value care?
    Answer 5. The Affordable Care Act includes tools to improve the 
quality of health care that can also lower costs for taxpayers and 
patients. This means avoiding costly mistakes and re-admissions, 
keeping patients healthy, rewarding quality instead of quantity, and 
building on the health information technology infrastructure that 
enables new payment and delivery models to work efficiently and 
effectively. These reforms and investments will build a health care 
system that will ensure quality care for generations to come.
    Accountable Care Organizations (ACOs) are an example of an 
initiative showing signs of success in delivering high value care. On 
January 30, 2014 CMS released the interim financial results for the 
Medicare Shared Savings Program ACOs, which showed that in their first 
12 months, nearly half (54 out of 114) of the ACOs that started program 
operations in 2012 already had lower expenditures than projected. An 
independent preliminary evaluation of the Pioneer ACO Model--the ACO 
model designed for more experienced organizations prepared to take on 
greater financial risk--shows that of the 23 Pioneer ACOs, nine had 
significantly lower spending growth relative to Medicare fee for 
service. These findings demonstrate that ACOs of various sizes and 
structures across the country are working to better coordinate care 
while reducing expenditure growth.
    Through the Hospital Value-Based Purchasing Program, CMS is 
changing the way it pays hospitals, rewarding hospitals for the quality 
of care they provide to Medicare patients, not just the quantity of 
procedures they perform. Hospitals are rewarded based on how closely 
they follow best clinical practices, how well they enhance patients' 
experiences of care, and on the outcomes they achieve. When hospitals 
follow proven best practices, patients receive higher quality care and 
see better outcomes.
    These are just a few examples of the initiatives underway. If 
confirmed, I look forward to overseeing continued efforts at CMS to 
actively transform Medicare from a passive payer of services into an 
active purchaser of high-quality, affordable care that enhances the 
value of services that Medicare beneficiaries receive.

    Question 6. This past week, the Department of Health and Human 
Services reported that the number of adverse events, including 
medication errors, fell by 9 percent between 2010 and 2012, and the 30-
day hospital re-admissions among Medicare Fee-for-Service patients fell 
8 percent. Over the past few years, Minnesota has seen even more 
dramatic declines in the number of medication errors resulting from the 
implementation of innovative reforms, including programs that require 
pharmacists to reconcile medications upon hospital discharge. For 
example, Hennepin County Medical Center implemented a program through 
its electronic health record system to assign pharmacists to review 
medication orders at the time of discharge. As a result of this 
program, the medication error rate plummeted nearly to zero and the 30-
day re-admission rate was reduced by half.
    This program has proven successful in Minnesota and similar efforts 
are showing results nationwide. These innovative delivery system 
reforms improve care for patients, save money, and most importantly, 
save lives. That's why I wrote a comment requesting that electronic 
health records certification criteria for Stage 3 Meaningful Use enable 
the collection of data to support this intervention that can save 
lives.
    If confirmed as Secretary, how will you use your authority to push 
forward sensible delivery system reforms and what goals will you focus 
on in pursuing that reform?
    Answer 6. To address the rising costs of health care, we must 
improve the way that health care is delivered, including the 
coordination and safety of care. The Affordable Care Act includes tools 
to improve the quality of health care that can also lower costs for 
taxpayers and patients. The Center for Medicare and Medicaid Innovation 
(Innovation Center), created by the Affordable Care Act, is an 
important part of these efforts.
    This month, HHS released preliminary data that shows an overall 9 
percent decrease in hospital-acquired conditions nationally during 2011 
and 2012. National reductions in adverse drug events, falls, 
infections, and other forms of hospital-induced harm are estimated to 
have prevented nearly 15,000 deaths in hospitals, avoided 560,000 
patient injuries, and avoided approximately $4 billion in health 
spending over the same period. These improvements reflect policies and 
an unprecedented public-private collaboration made possible by the 
Affordable Care Act. The data demonstrates that hospitals and providers 
across the country are achieving reductions in hospital-induced harm 
experienced by patients. These major strides in patient safety are a 
result of strong, diverse public-private partnerships and active 
engagement by patients and families.
    HHS is working collaboratively--along with health care providers 
and other private sector stakeholders--to identify and scale best 
practices and solutions to reducing hospital-acquired conditions and 
re-admissions. If confirmed, I looked forward to continuing to work 
with the committee to achieve these important goals.
                             senator warren
    Questions 1a and 1b. Last year, the FDA released the unique device 
identifier (UDI) final rule last year. UDIs are essential to 
transforming our understanding of the safety and effectiveness of 
medical devices. The FDA has stated in the past that in order to 
achieve the benefits of the UDI system, the UDI information must be 
captured in electronic health information. As you know, FDA does not 
have jurisdiction over health IT, electronic medical records 
incentives, or medical claims data.
    a. How do you plan to coordinate the FDA, Centers for Medicare and 
Medicaid Services, the Office of the National Health Coordinator for 
Health Information Technology, and the medical device industry to 
facilitate the integration collection of UDIs into electronic health 
information?
    b. What steps should each of these agencies take in order to 
achieve the maximum benefits of this system as soon as possible?
    Answers 1a and 1b. In my capacity as OMB Director, I have not been 
engaged in the specific issue that you raise and look forward to 
learning more if confirmed. I understand from HHS that the FDA and the 
Office of the National Coordinator for Health IT (ONC) work closely on 
the shared goal of incorporating Unique Device Identification (UDI) 
into electronic health record technology. FDA's Center for Device and 
Radiological Health (CDRH) has collaborated with the ONC policy staff 
toward the development of a UDI requirement in ONC's Notice of Proposed 
Rulemaking (NPRM) for Electronic Health Records (EHR) Certification 
Criteria.
    Recording the UDI is also part of the recommendations issued by the 
Health IT Policy Committee to the ONC and CMS related to meaningful 
use. ONC and CMS work closely to ensure alignment of the EHR 
certification criteria with meaningful use. These efforts represent the 
first steps toward enabling EHR technology to facilitate the widespread 
capture and use of UDI data to prevent device-related medical errors, 
improve the ability of hospitals and clinicians to respond to device 
recalls, and achieve other important patient safety and public health 
benefits consistent with the fundamental aims of FDA's National Medical 
Device Post-market Surveillance Plan.

    Question 1c. Do you intend to facilitate collaboration between the 
FDA, CMS, and other payers to incorporate medical device information 
into the Sentinel Initiative--if not, why not, and if so, what steps 
will you take?
    Answer 1c. In my capacity as OMB Director, I have not been engaged 
in the specific issue that you raise and look forward to learning more 
if confirmed. I understand from HHS that the current Sentinel 
Initiative data model focuses on querying privacy-protected 
administrative and claims data complemented, in part, by information in 
EHRs (such as lab results) and maintained by partner organizations. 
Unfortunately, most records accessible to the Sentinel Initiative lack 
manufacturer or brand-specific device identifiers and, therefore, 
cannot currently be leveraged to perform meaningful medical device 
post-market surveillance. However, as UDIs are implemented and adopted 
throughout the health care system, current efforts can be expanded to 
include this essential information for the purpose of medical device 
post-market surveillance.
    Incorporating UDIs into claims will be a multi-year effort that 
will require ongoing engagement with stakeholders. Over the past 2 
years, FDA has collaborated with the Brookings Institution (Engelberg 
Center for Health Care Reform) to create a ``roadmap'' for 
incorporation of UDIs into electronic health information. Input was 
garnered through a series of workgroup sessions with relevant 
stakeholders, most importantly CMS and other payer organizations.
    The Sentinel Initiative will ultimately benefit from these efforts 
by incorporating UDIs into its claims data sources.

    Question 2a. Currently, men who have sex with men (MSM) are 
deferred for life from donating blood. Current blood screening 
technology can detect HIV, meaning that our current policy turns away 
healthy, willing donors. A change in the current policy is supported by 
the 2010, the Advisory Committee on Blood Safety and Availability 
(ACBSA), the American Medical Association, the American Red Cross, and 
AABB (formerly the American Association of Blood Banks). In addition, 
other countries have reversed their lifetime bans. Further, the 
existing lifetime ban continues to perpetuate inaccurate stereotypes 
against gay and bisexual men.
    HHS has already initiated several studies to assess the risks of a 
policy change and will all be complete this year. Last year, I led a 
letter to Secretary Sebelius with Senators Baldwin and Enzi, 
Representatives Quigley and Lee, and 81 other members of the House and 
Senate asking for an update on the research studies and how HHS is 
using data collected in other counties that already changed their 
lifetime deferral policies for MSM.
    Will you commit to making a policy change to a risk-based deferral 
for MSM this year?
    Answer 2a. In my capacity as OMB Director, I have not been engaged 
in the specific issue that you raise and look forward to learning more 
if confirmed. I understand from HHS that in June 2010, the HHS Advisory 
Committee on Blood Safety and Availability (ACBSA) heard presentations 
of available scientific data regarding the current policy of deferring 
men who have had sex with other men (MSM), even once since 1977, from 
blood donation. The ACBSA recommended to the HHS Secretary that, while 
suboptimal, the policy should be retained pending the completion of 
targeted research studies that might support a safe alternative policy. 
Additionally, in September 2013, HHS Secretary Sebelius informed 
Members of Congress that, ``Absent any unexpected delays in the 
completion or analyses of the studies, HHS anticipates finishing 
deliberations on a policy recommendation by late 2014.''
    It appears that the ongoing studies remain on track and HHS reports 
being on track to complete deliberations on a policy recommendation by 
late 2014. I look forward to following up on this issue if confirmed.

    Question 2b. In December 2013, the HHS Advisory Committee on Blood 
and Tissue Safety and Availability recommended that before any change 
to the current lifetime ban on blood donation from men who have sex 
with men (MSM), a U.S. Donor Transfusion--Transmissible Infection 
Monitoring System must be established. Secretary Sebelius has not 
accepted or rejected that recommendation. The CDC estimates 16,500 new 
cases of Hepatitis C, 18,800 new cases of Hepatitis B, 2,700 new cases 
of Hepatitis A, and over 20,000 new cases of HIV not in MSM, emerged in 
2011. People at high risk for these diseases are removed from the donor 
pool by risk-based screening. According to the Red Cross, current blood 
screening techniques are not effective at detecting a newly infected 
individual with Hepatitis C for 1 week, a newly infected individual 
with Hepatitis A or B for 3 to 4 weeks, or a newly infected individual 
with HIV for 7-10 days. The agency has not found either these infection 
rates, or periods that screening is not effective at detecting the 
viruses, to be reasons to implement a screening system.
    Given the above data, why has the committee not recommended a U.S. 
Donor Transfusion--Transmissible Infection Monitoring System in the 
past to address Hepatitis A, B, and C donations?
    Answer 2b. The United States blood supply is among the world's 
safest due to multiple, overlapping safeguards against Transfusion 
Transmitted Infections (TTI). As correctly noted above, blood screening 
tests are limited by their inability to detect recent infections during 
a window period of viral replication. The donor screening questionnaire 
that is administered to all potential donors is used to help compensate 
for such limitations of the HIV, Hepatitis B, and Hepatitis C tests 
during the window period, and there is evidence that this questionnaire 
is responsible for a portion of the risk reduction achieved. Testing 
for Hepatitis A is not required, because transfusion transmission of 
this virus is extremely rare.
    In my capacity as OMB Director, I have not been engaged in the 
specific issue that you raise and look forward to learning more if 
confirmed. I understand from HHS that, in response to Question b, the 
need for a blood safety surveillance system to assess the risk of 
transfusion-transmitted diseases has been addressed intermittently in 
the past through government-funded and private-sector studies.
    In terms of implementation of such studies, I understand from HHS 
that the National Heart, Lung, and Blood Institute (NHLBI) funded 
studies of marker rates and risk factors in donors at various times 
between 1980 to the 1990s, then again in 2011-12. Annual surveys for 
HIV in blood donors were carried out by CDC in 1988-98. Similar studies 
were carried out by the Red Cross in 2010 and 2012.

    Question 2c. Given the faster turnaround time associated with the 
HIV test compared with the tests for Hepatitis A and B, why isn't risk-
based screening for HIV infections in MSM a sufficient replacement for 
the lifetime ban on MSM donation, even without a monitoring system in 
place?
    Answer 2c. In response to Question 2c, I understand from HHS that 
the risk of infection from transfusion depends on two factors: the time 
after infection during which there can be a false negative donor 
screening test (i.e., length of the ``window period'' when tests are 
negative in the face of infection) and the frequency of recent 
infections in donors (``incidence'' of infections.) It is correct that 
the window period for failed detection of HIV using current test 
technology is very brief (average of 9-10 days). However, the incidence 
of HIV among MSM is higher than in the non-MSM population and a 
significant proportion of MSM are unaware of their risk.
    If an individual, unaware of his risk, presents to donate during 
the window period, there is a chance for disease transmission. There is 
also evidence from look-back investigation of donated units that are 
found to be HIV positive that self-reporting of MSM behavior is not 
always accurate. Therefore, testing and donor screening questionnaires 
both contribute to blood safety.

    Questions 2d-g. If a you were to accept the Advisory Committee's 
recommendation regarding the establishment of the Infection Monitoring 
System--although a change in the discriminatory MSM policy that is 
already supported by science should happen this year and not be linked 
to an additional policy change that is not tied to the group in 
question--I have specific questions about how this system would be 
implemented.
    d. Which of the involved agencies (FDA, CDC, NIH) would be 
ultimately responsible for the implementation and maintenance of such a 
system?
    e. What would be the timeline for implementation and cost 
associated with such a system?
    f. How would this system be paid for?
    g. Do you believe that HHS has the authority to implement this 
monitoring system without congressional direction?
    Answer 2d-g. In my capacity as OMB Director, I have not been 
engaged in the specific issue that you raise and look forward to 
learning more if confirmed. HHS reports ongoing engagement of the PHS 
Agencies (NIH, FDA, and CDC) to consider a donor infectious disease 
surveillance system as recommended by the ACBTSA. As those 
considerations advance, HHS can address specific questions about 
possible implementation.
                            senator baldwin
    Question 1. The President's Budget proposes a new 5-year 
collaborative Medicaid demonstration to encourage States to provide 
evidence-based psychosocial interventions to children and youth in the 
foster care system to reduce the over-prescription of psychotropic 
medications and to improve health outcomes. My bipartisan Quality 
Foster Care Services Act (S. 1992) would improve access to the high-
quality, evidence-based intervention therapeutic foster care (TFC) for 
children with special behavioral health needs and/or medical 
disabilities. My bill would improve access to these services by 
providing for a standard Medicaid definition for TFC. TFC works to keep 
particularly vulnerable youth out of costly and often ineffective 
institutional care. In addition, it provides needed clinical therapy 
options to youth in lieu of overmedication.
    I am encouraged by the Department's existing efforts through CMS, 
SAMHSA, and ACF to evaluate TFC and I look forward to the report on 
these findings. As Secretary, how would you continue the critical work 
to improve access to TFC and other evidence-based interventions for 
vulnerable youth? And how would you collaborate with State partners to 
clarify the availability of Medicaid financing for TFC for children 
with serious mental and emotional disorders?
    Answer 1. I share your commitment to ensuring that children in 
foster care who have special needs receive appropriate care. In 
particular, I share your goal of reducing over-medication of children 
covered by Medicaid. To that end, the fiscal year 2015 President's 
Budget includes a $750 million, 5-year CMS and ACF collaborative 
demonstration project to encourage States to implement evidence-based 
psychosocial interventions targeting children in the foster care system 
as an alternative to the current over-prescription of psychotropic 
medications in this population. This transformational approach will 
include the development and scaling up of screening, assessment, and 
evidence-based treatment of trauma and mental health disorders among 
children in foster care in order to reduce the inappropriate reliance 
on psychotropic medications. We have been focusing on several evidence-
based practices that according to ACF, CMS, and SAMHSA are effective 
regardless of whether a child is living in a foster care family or in a 
therapeutic foster care family. HHS will continue to examine models of 
therapeutic foster care as well, and are interested in the evidence 
base regarding the impact various models have on effective treatment 
for children.

    Question 2. HIV/AIDS remains a public health crisis in our country. 
Every year, more than 50,000 Americans become infected with HIV, and 
there are almost 5,000 Wisconsinites currently living with the disease. 
The Affordable Care Act (ACA) makes significant advances in access to 
quality, affordable health coverage for Americans with HIV/AIDS. In 
addition, the Ryan White HIV/AIDS Program, which acts as a payer of 
last resort, provides medications, medical care, and coverage 
completion services to approximately 554,000 low-income, uninsured, and 
underinsured individuals living with HIV/AIDS.
    Will you commit to continued support of all parts of the Ryan White 
Program through adequate funding, and ensure these critical services 
are adequately coordinated with the coverage gained under the 
Affordable Care Act?
    Answer 2. The Administration strongly supports the Ryan White HIV/
AIDS Program (RWHAP). Studies have shown that the successful treatment 
of individuals living with HIV can reduce the risk of transmission by 
over 90 percent. As such, efforts by the RWHAP providers to help 
individuals living with HIV adhere to treatment and remain in care--
through the delivery of health care services, the purchase of insurance 
coverage and prescription medication, as well as the provision of case 
management services--are critical to controlling the epidemic and 
achieving what all of us want, an AIDS-free generation. It also has 
helped create a public health approach to treatment by supporting 
systems of care that engage diverse populations in their community.
    While the Affordable Care Act has enabled many RWHAP clients to 
enroll in Medicaid coverage or receive tax credits to help with the 
purchase of health insurance coverage through the new Marketplace, 
funding for the RWHAP will continue to be necessary in order to improve 
outcomes for people living with HIV, decrease HIV/AIDS morbidity and 
mortality rates and reduce disease transmission. If I am confirmed, HHS 
will continue to focus on meeting the goals of the National HIV/AIDS 
Strategy:

     Reducing the number of people with HIV;
     Increasing access to care and health outcomes for people 
with HIV; and
     Reducing HIV-related health disparities.

    Question 3. How do you plan to ensure that barriers to care and 
treatment are fully addressed for individuals living with chronic or 
life threatening conditions, such as HIV, as you move forward with ACA 
implementation? As part of these efforts, how would you address other 
deadly infections that disproportionately affect people living with HIV 
such as Viral Hepatitis?
    Answer 3. The Administration has demonstrated a commitment to 
removing barriers to care and treatment for individuals living with 
chronic or life threatening conditions, such as HIV, throughout the 
implementation of the Affordable Care Act. For example, just recently, 
the Administration issued a regulation requiring Marketplace plans to 
accept the Ryan White HIV/AIDS Program payments for health insurance 
coverage for people living with HIV. HHS will continue to provide 
extensive technical assistance to Ryan White HIV/AIDS Program (RWHAP) 
grantees to maximize enrollment of people living with HIV into new 
available health insurance coverage and I look forward to advancing 
this work if I am confirmed.
                             senator bennet
    Question. The HELP Committee has a long history of working in a 
bipartisan manner to pass numerous pieces of health care legislation 
into law. One of the committee's strongest areas for bipartisan work is 
in the FDA space. We have done a lot of work with the FDA, our Colorado 
bioscience community, and patients, around reforming the laws to ensure 
patients have faster access to higher quality drugs and devices.
    This bipartisan work with Senators Hatch and Burr on Breakthrough 
Therapies will speed truly innovative and lifesaving drugs to market. 
We could potentially improve the law's implementation by helping CMS 
understand that the FDA's work is not just in Breakthrough Therapies, 
but in many areas across the review process, including devices and 
biologics.
    Would you be willing to work with us to improve the collaboration 
across CMS and FDA, in order to reduce obstacles to delivering these 
lifesaving products to patients in a timely manner?
    Answer. Thank you for your leadership on the breakthrough therapies 
provision in the Food and Drug Administration Safety and Innovation Act 
(FDASIA). If confirmed, I look forward to supporting the Department's 
work with the committee on patient access and ensuring collaboration 
across HHS on these issues.
                             senator murphy
    An essential component of our plans to vaccinate the public in the 
event of a pandemic event is the availability of the needles and 
syringes that are required to inject these critical drugs. In numerous 
legislative vehicles, Congress has directed BARDA to prioritize 
ensuring that a sufficient supply of drug delivery devices are 
available to prepare for a public health emergency. However, I am 
concerned that we have not taken the necessary steps to secure the drug 
delivery devices that are required to ensure that we are appropriately 
prepared.
    Questions 1a-c. Can you provide details on the actions that the 
Department is taking to secure drug delivery devices, including 
projected timelines, for the following scenarios:

    a. To distribute the vaccine that is currently in the Strategic 
National Stockpile and available for delivery today.
    Answer a. My understanding from HHS is that the CDC maintains 
vaccines for anthrax and smallpox at various Strategic National 
Stockpile (SNS) locations. In addition to these specific 
countermeasures, the CDC stockpiles ancillary supplies to support the 
administration of vaccines and other products. The Stockpile stores 28 
million syringes that may be used to administer other vaccines, 
including pandemic influenza vaccines. The CDC/SNS does not procure or 
stockpile seasonal or pandemic influenza vaccine. These items are 
procured by BARDA. An annual review of the SNS inventory is performed 
and reported to Congress. The CDC/SNS plans and has carriers on 
contract to distribute these products in the event of a public health 
emergency.

    b. To distribute the vaccine that BARDA is expecting to procure.
    Answer b. I understand that the HHS pandemic influenza response 
plan designates CDC as the organization responsible for vaccine 
distribution during an influenza pandemic, such as the 2009 H1N1 
pandemic. Likewise, BARDA can make use of existing contracts with 
influenza vaccine manufacturers and ancillary supplies to purchase 
these products for delivery to the CDC's distribution. CDC will then 
instruct their distribution hubs to deliver these products to the 
designated sites.

    c. To distribute the vaccine required in the event of a public 
health emergency.
    Answer c. It is my understanding from HHS that depending on the 
type of public health emergency, the CDC/SNS will distribute medical 
countermeasures including available vaccines and ancillary supplies 
from its stockpile hubs to the designated sites.
    If the event is pandemic influenza, I understand that the HHS 
designates CDC as the organization responsible for vaccine 
distribution. Likewise, BARDA can make use of existing contracts with 
influenza vaccine manufacturers and ancillary supplies to purchase 
these products for delivery to the CDC's distribution. CDC will then 
instruct their distribution hubs to deliver these products to the 
designated sites. The CDC/SNS has operational plans to distribute the 
vaccines for anthrax and smallpox and select ancillary supplies to 
State and local partners in the event of a public health emergency. For 
pandemic influenza, vaccines are distributed by CDC/NCIRD/ISD. Vaccines 
for pandemic influenza, once developed and procured by BARDA, are 
distributed by CDC/NCIRD/ISD.

    Question 1d. How many drug delivery devices has BARDA secured to 
address each of these scenarios? And could you please distinguish 
between contracts that have been awarded and contracts that have been, 
in fact, funded, specifying by how much relative to the awarded amount?
    Answer 1d. I am aware that the Strategic National Stockpile (SNS) 
program at CDC maintains stockpiles of vaccine against certain threats, 
as well as ancillary supplies to support administration of these 
products. In addition to ancillary supplies procured for specific 
vaccines, CDC/SNS also maintains ancillary supplies that could be 
distributed during a public health emergency (e.g., flu vaccines). The 
annual review of the CDC/SNS inventory that is performed and submitted 
to Congress addresses these needs using available annual funding to the 
CDC.
    In the case of a pandemic, HHS pandemic influenza response plans 
designate CDC as the responsible organization for distribution of 
vaccines, as was done during the H1N1 2009 pandemic. During an 
influenza pandemic, I understand that BARDA would utilize its existing 
contracts with multiple manufacturers of influenza vaccines and 
ancillary to purchase these products for delivery to the CDC's 
distribution hubs. CDC, based on ordering from States and territories, 
would instruct the distribution hubs to deliver these products to the 
designated sites.

    Question 2. Director Burwell, current Federal regulations define 
whether a health plan provides ``essential health benefits'' (EHB). Do 
you believe that the U.S. Department of Health and Human Services 
should consider whether plans that require cancer patients to pay far 
greater out-of-pocket costs for oral anti-cancer medication simply on 
the basis of the type of delivery mechanism used provide EHB? Can you 
commit to working with me and others on the committee and other 
stakeholders on potential legislative and regulatory solutions to this 
urgent issue?
    Answer 2. In my role as OMB Director, I was not engaged on this 
topic. That said, I understand from HHS that regulations implementing 
the Affordable Care Act provide detail on how health insurance plans in 
the individual and small group markets must provide the Essential 
Health Benefits (EHB). These regulations include cost-sharing 
protections that limit the amount of out-of pocket expenses consumers 
and their families can be subject to, as well and anti-discrimination 
provisions that ensure that qualified health plans (QHPs) do not employ 
benefit designs that discriminate against individuals with significant 
health needs. If confirmed, I would be happy to look into your 
concerns.
                           senator alexander

Memberships and Positions Held Outside U.S. Government

    Question 1. On March 26, 2013, you submitted answers to the U.S. 
Senate Committee on Homeland Security and Governmental Affairs' Common 
Questions for Executive Nominees. Under memberships you listed yourself 
as a member of the Wasatch Group. Please explain the nature of this 
organization and your role therewith.
    Answer 1. The Wasatch Group is an organization comprised of leaders 
from a variety of industries interested in working on youth issues. As 
a member, I attend the Group's annual gatherings in Wasatch, UT.

    Question 2. In your April 2014 Executive Branch Personnel Public 
Financial Disclosure Report you list your participation in the Advisory 
Group for The Nike Foundation from March 2005 to April 2013. Please 
explain the full nature of your work for The Nike Foundation.
    Answer 2. As a Member of the Nike Foundation Advisory Group, I 
provided advice to the CEO of the Nike Foundation on general issues of 
international development. The Nike Foundation is governed by a 
separate board of directors of which I was not a part.

    Question 3. Please explain the full nature of your work as a 
director on the board of directors of MetLife.
    Answer 3. The Board of Directors is responsible for managing the 
property, affairs and business of the Corporation. As a Director of the 
Corporation, and in accordance with the corporation's By-Laws, I also 
served on board committees, such as the Audit Committee and Governance 
and Corporate Responsibility Committee.

    Question 4. Please describe your work on ``healthcare in the 
developing world'' at the Gates Foundation that is referenced in your 
written testimony.
    Answer 4. At the Gates Foundation, I worked on a range of issues in 
the health care space, from helping to create an office in India and 
supporting their work on HIV/AIDS, to working on creating a special 
purpose vehicle to increase private sector investments in vaccines for 
the developing world.

MetLife, Inc.

    Question 1. On February 28, 2013, the U.S. District Court for the 
southern district of New York ruled that two of six claims related to 
allegations of an omission of material fact or untrue statement of 
material fact in an SEC filing could move forward against MetLife, 
Inc., MetLife executives, and 11 of 12 directors from the MetLife board 
of directors. You were one of the directors named as a defendant. 
Please explain your involvement in the defense of this ongoing 
litigation.
    Answer 1. I am not directly involved in the defense of this 
litigation. It is being handled by MetLife and attorneys retained by 
MetLife.

    Question 2. When you appoint an agent for purposes of receiving 
service of process, and that agent receives notice of legal action 
taken against you, under the law you have received notice of the 
litigation. According to the court record in City of Westland Police 
and Fire Retirement System v. Metlife, Inc., et al., an attorney at 
Debevoise & Plimpton, LLP was designated as the attorney to receive 
service of process on your behalf, and a waiver of service was returned 
executed on May 5, 2012. On February 28, 2013, a U.S. District Court 
ruled that two claims in the suit could move forward against you and 
the other director defendants. However, your March 2013 Budget 
Committee and Homeland Security and Government Affairs Committee 
applications for your nomination as OMB Director did not disclose that 
you were a named party in this lawsuit, but stated in generic terms 
that you might be a defendant in litigation brought against MetLife. 
Why did you not disclose this specific, ongoing litigation to the U.S. 
Senate?
    Answer 2. Like most corporations, MetLife is a defendant in a 
number of litigation matters and Board Members are sometimes named as 
defendants in those matters, as is the case in City of Westland Police 
and Fire Retirement System v. MetLife. Accordingly, in my response to 
the March 2013 questionnaires, I acknowledged the possibility that I 
might have been named in such matters. At that time, I did not recall 
any specific matters pertaining to my role as a MetLife Board Member in 
which I was a named defendant.

    Question 3. On February 26, 2013, you, along with your then-fellow 
MetLife Board Members, submitted an annual report to the SEC. In this 
report, the Board and MetLife executive officers stated the Patient 
Protection and Affordable Care Act (PPACA) and The Health Care and 
Education Reconciliation Act of 2010,

        ``may lead to fundamental changes in the way that employers, 
        including us, provide health care benefits, other benefits, and 
        other forms of compensation to their employees and former 
        employees.''

    MetLife also highlighted that both laws imposed particular 
requirements on the company as a provider of non-medical health 
insurance benefits and thus,

        ``could adversely affect our ability to offer certain [types] 
        of these products in the same manner as we do today. They could 
        also result in increased or unpredictable costs to provide 
        certain products, and could harm our competitive position [if 
        either laws have] a disparate impact on our products compared 
        to products offered by our competitors.''

    Last, the report stated the following:

          ``In addition, we employ a substantial number of employees, 
        including sales agents, in the United States to whom we offer 
        employment-related benefits. We also currently provide benefits 
        to certain [] retirees. These benefits are provided under 
        complex plans that are subject to a variety of regulatory 
        requirements. Either [law] could adversely affect our ability 
        to attract, retain and motivate our associates. They could also 
        result in increased or unpredictable costs to provide employee 
        benefits, and could harm our competitive position if we are 
        subject to fees, penalties, tax provisions or other limitations 
        in the [laws] and our competitors are not.''

    Question 4. Did PPACA and/or any other related regulations and/or 
regulatory actions lead to fundamental changes in the way MetLife 
provided health care benefits, other benefits, and/or other forms of 
compensation to its employees and/or former employees? If yes, how? Did 
PPACA and/or any other related regulations and/or regulatory actions 
adversely affect MetLife's ability to offer health care benefits, other 
benefits, and/or other forms of compensation to its employees and 
former employees? If yes, how?
    Answer 4. The Annual Report contains forward-looking statements 
involving a number of risks and uncertainties affected by factors 
ranging from legislation to disruption in capital and credit markets. I 
resigned from the Board in April 2013 and do not have specific 
knowledge of the impact that subsequent factors, including the 
implementation of legislation or regulatory actions, may have on 
MetLife's business operations.

    Question 5. Did PPACA and/or any other related regulations and/or 
regulatory actions adversely affect MetLife's ability to offer non-
medical health insurance benefits? If yes, how? Did PPACA and/or any 
other related regulations and/or regulatory actions result in increased 
and/or unpredictable costs for MetLife to provide certain products and/
or harm MetLife's competitive position because PPACA and/or any other 
related regulations and/or regulatory actions had a disparate impact on 
MetLife's products compared to products offered by its competitors? If 
yes, how?
    Answer 5. The Annual Report contains forward-looking statements 
involving a number of risks and uncertainties affected by factors 
ranging from legislation to disruption in capital and credit markets. I 
resigned from the Board in April 2013 and do not have specific 
knowledge of the impact that subsequent factors, including the 
implementation of legislation or regulatory actions, may have on 
MetLife's business operations.

    Question 6. Did PPACA and/or any other related regulations and/or 
regulatory actions adversely affect MetLife's ability to attract, 
retain and/or motivate its associates? If yes, how? Did the PPACA and/
or any other related regulations and/or regulatory actions result in 
increased and/or unpredictable costs for MetLife to provide employee 
benefits? If yes, how? Did the PPACA and/or any other related 
regulations and/or regulatory actions harm MetLife's competitive 
position because MetLife was subject to fees, penalties, tax provisions 
and/or other limitations and its competitors were not?
    Answer 6. The Annual Report contains forward-looking statements 
involving a number of risks and uncertainties affected by factors 
ranging from legislation to disruption in capital and credit markets. I 
resigned from the Board in April 2013 and do not have specific 
knowledge of the impact that subsequent factors, including the 
implementation of legislation or regulatory actions, may have on 
MetLife's business operations.

Priorities as U.S. Department of Health and Human Services (HHS) 
                    Secretary

    Question 1. Health care costs and the cost of insurance continue to 
rise. What would you do as Secretary to address the key health cost 
drivers?
    Answer 1. We need to move from a health care system that rewards 
quantity of care provided to quality of care provided. There are 
several key areas I hope to focus on in this space: (1) implementing 
delivery system reforms that build on the Center for Medicare and 
Medicaid Innovation's work to transform payment models to encourage 
better collaboration, efficiency, and improved outcomes; (2) carefully 
implementing cost-savings measures in the Affordable Care Act and 
advocating for savings proposals in the President's budget; and (3) 
ensuring that we continue to focus on fighting fraud and abuse. I 
believe that it is also important to engage with the private sector so 
that all payers are aligned in this process.

    Question 2. On what specific policies will you work with Congress 
and the States to reduce the burdens of the new health care law that 
add to the cost of health insurance?
    Answer 2. The new health care law provides grants to States to 
enhance their rate review processes. With this funding, States can 
review proposed premium increases to ensure that they are justified, 
and depending on State authorities, can potentially modify or deny 
premium increases that are not justified. Thus far, this program has 
led to a significant decrease in the number of requested premium 
increases that are above 10 percent, saving Americans $1 billion in 
premiums since 2011. In addition, the premium stabilizations programs 
from the Affordable Care Act--risk adjustment, reinsurance, and risk 
corridors--will continue to help stabilize the insurance markets and 
keep quality coverage affordable.

    Question 3. With many recent resignations, there are very few 
individuals in leadership roles with experience in private insurance 
left at HHS, the Centers for Medicare and Medicaid Services (CMS), or 
the Center for Consumer Information and Insurance Oversight (CCIIO). 
How would you plan to address this lack of expertise at HHS?
    Answer 3. Throughout the course of my career, including in several 
large and complex organizations, I have dedicated significant time and 
energy to recruiting and developing the best talent. You have to have 
the best people--and a range of experiences and viewpoints--around the 
table to solve the types of big challenges confronting OMB and HHS on a 
daily basis. I have worked to assemble a quality team at OMB and in all 
of my prior roles in the public and private sector. And, if confirmed, 
I will be committed to retaining and attracting the quality talent that 
the Department needs to deliver results for the American people.

    Question 4. According to the Galen Institute, the administration 
has executed at least 22 extra-legal ``fixes'' to PPACA, many of them 
after open enrollment began on October 1, 2013. What will you do as HHS 
Secretary to provide more stability to the public and private health 
insurance market so that last-minute, extra-legal changes are not 
necessary? What changes to existing law and regulation do you 
anticipate having to make before December 31, 2014?
    Answer 4. If confirmed, I will work with Congress, policy experts, 
and stakeholder groups to help facilitate stability in the health 
insurance market. I am committed to ensuring as smooth a transition as 
possible for consumers and issuers, and will want to listen to 
participants across the health care system as implementation of the law 
continues.

Priorities as Office of Management and Budget (OMB) Director

    Question 1. President Obama delivered his fiscal 2015 budget 1 
month after its statutory deadline. How did this process, which you 
oversaw as OMB director, fall so far behind schedule? Please explain 
how you interpret a statutory deadline as having this level of 
flexibility. Do you believe that statutory requirements like this 
should routinely be ignored by the executive branch? Why or why not?
    Answer 1. I take statutory deadlines extremely seriously and work 
very hard to meet them. Where possible, the President's Budget should 
incorporate final current year appropriations levels to provide 
Congress with an up-to-date fiscal picture. In this case, Congress did 
not file the near-final appropriations bills for fiscal year 2014 until 
January 13, 105 days after the start of the fiscal year. Given the 
delay in enactment of final fiscal year 2014 appropriations, the 
Administration worked to release the President's Budget as soon as 
possible after the fiscal year 2014 appropriations levels became known.

    Question 2. As OMB Director you oversaw the Office of Information 
and Regulatory Affairs, which reviews the Regulatory Impact Analyses 
(RIAs) executive branch agencies produce when they issue major new 
regulations. Research from the Mercatus Center at George Mason 
University finds that RIAs produced by HHS are often seriously 
incomplete and less thorough than those produced by other executive 
branch agencies. The analyses accompanying the early regulations 
implementing PPACA were especially incomplete. What will you do as HHS 
secretary to ensure that Regulatory Impact Analyses provide thorough, 
evidence-based assessments of the factors Executive Order 12866 says 
they should assess, and that this analysis will be performed before HHS 
makes major regulatory decisions that the analysis is supposed to 
inform?
    Answer 2. I believe that thorough and robust regulatory impact 
analyses are very important. In general, it is important that the 
benefits of rules justify their costs and that rules accomplish their 
goals in the least burdensome way possible. It is also important that 
agencies use the most up-to-date economic information and the best 
available techniques for determining the estimated costs and benefits 
of a rule. Regulations should be tailored in such a way so as to impose 
the least burden on society while still accomplishing their goals.
    OMB provides general guidance to agencies on how best to evaluate 
and present the economic impacts and benefits of rules. These factors 
and OMB guidance to agencies are set out in more detail in Executive 
Orders 12866 and 13563, and OMB Circular A-4, which is a guidance 
document to all agencies on how to conduct regulatory analysis. If 
confirmed, I would work to ensure that the analyses produced by HHS are 
consistent with these Executive orders and the Circular.

Health Insurance Exchange

    Question 1. Will you commit to being more transparent about 
enrollment in the new health insurance exchanges by providing weekly 
updates to Congress and the American people? How many people have paid 
their first month's premium? How many people have paid their second and 
third month's premium? How many people were previously uninsured? How 
much money, and on behalf of how many people, has the Administration 
paid to each insurance carrier in cost-sharing and premium assistance 
subsidies? How many additional people enrolled in Medicaid, broken down 
by poverty level? How many new Medicaid enrollees were previously 
eligible?
    Answer 1. If confirmed, I will continue the Department's 
longstanding focus on transparency and accuracy. When CMS has accurate 
and reliable data regarding premium payments, I will see that this 
information is made available. I have included information below that 
is publicly available.

Premium Payment

    Some issuers have made public statements indicating that 80 percent 
to 90 percent of the people who have selected a Marketplace plan have 
made premium payments. Issuers have the flexibility to determine when 
premium payments are due.

Prior Coverage Status

    In addition to the more than 8 million people who have selected 
plans through the Marketplace during the initial open enrollment 
period, CBO recently estimated that an additional 5 million people have 
purchased coverage outside of the Marketplace in Affordable Care Act-
compliant plans. Moreover, recent national surveys indicate that the 
number of Americans with health insurance coverage is growing, and the 
number of 18- to 64-year-olds who are uninsured is declining. For 
example, Gallup has found a 5 percentage point decrease in the 
uninsured rate for adults (18 and over) from the third quarter of 2014 
to April 2014 (18 percent versus 15 percent, respectively. Similarly, 
the Urban Institute estimates a 2.7 percentage point decrease in the 
uninsured rate for adults (18 to 64) from October 1, 2013 to March 31, 
2014 (corresponding to a 5.4 million decline in the number of uninsured 
adults). Meanwhile, the RAND Corporation estimates a 4.7 percentage 
point decrease in the uninsured rate (corresponding to a net decrease 
of 9.3 million uninsured adults, ages 18 to 64) from the last week of 
September 2013 through March 2014.

Premium and Cost-sharing Support

    More than 8 out of 10 (85 percent) of the people who selected a 
Marketplace plan through the SBMs and FFM during the 2014 open 
enrollment period are eligible to receive Federal financial assistance 
in paying their premiums.

Medicaid and CHIP Enrollment

    Compared to enrollment before the Marketplace opened last October, 
4.8 million additional Americans are enrolled in Medicaid and CHIP 
through the end of March. A detailed report on State agencies' 
eligibility determination activities and State data on total enrollment 
in Medicaid and CHIP programs is available on the CMS Web site.

    Question 2. The American people deserve to know the truth about 
their rising healthcare costs, and you promised in your confirmation 
hearing before the U.S. Senate HELP Committee that transparency would 
be a guiding principle in your work as Secretary. President Obama's 
administration has moved the start of the open enrollment season back 
to after this year's mid-term elections, meaning that voters will not 
know the full price of health insurance facing them next year when they 
head to the polls. Will you commit to fulfilling your promise of 
transparency and returning the open enrollment season to its original 
start date?
    Answer 2. I understand that this past March the Department shifted 
open enrollment for the 2015 plan year by approximately 1 month to give 
consumers more time to learn about plans and select a plan and health 
insurance companies additional time to collect additional rating 
experience. If confirmed, I look forward to working with you to address 
your concerns.

    Question 3. The ongoing problems with healthcare.gov require 
issuers to manually correct errors in many enrollment records they 
receive. These problems mean that for many consumers the exchange has 
``bad data'' about them. What steps are being taken to correct this in 
preparation for the upcoming re-enrollment period in November? When 
will the full enrollment data reconciliation functionality be 
developed, tested and implemented? What is the specific timeline to fix 
these problems with the Web site and put these systems in place? How 
will you use your background as a manager of large, complex 
organizations to ensure the Web site gets fixed?
    Answer 3. It is my understanding that the Department has made 
specific fixes to correct information provided to insurers that allow 
applications to be processed and consumers to complete their payments. 
CMS has prioritized correctly transmitting consumer information to 
issuers. My understanding is that additional upgrades have been 
installed, focusing on direct enrollment and improving the consumer 
experience.
    By the end of the first open enrollment period, HealthCare.gov was 
working well and helped millions of consumers sign up for quality, 
affordable health coverage. As HHS enters the next phase of this work, 
the technology team remains vigilant in continuing to make improvements 
that will enhance the consumer experience.
    If I am confirmed, I will focus quickly on understanding what the 
team sees as the core remaining challenges and opportunities in this 
space and working with them to ensure that we continue to build on the 
progress to date to strengthen all aspects of the system.

    Question 4. The interim enrollment maintenance approach used by the 
exchange for special enrollment periods is error prone and has 
negatively impacted consumers because it is using cancellation and 
enrollment transactions in place of true maintenance transactions. When 
will the maintenance functionality to process ``life events'' be 
developed, tested and implemented?
    Answer 4. It is my understanding that after Open Enrollment, 
consumers may enroll in private coverage through the Marketplace if 
they have certain life events and other circumstances as provided in 45 
CFR Sec. 155.420. Examples of such events and circumstances include a 
permanent move, loss of minimum essential coverage, certain changes in 
income, and changes in family size (for example, if you marry, divorce, 
or have a baby). Consumers are required to attest to their change in 
circumstance. In anticipation for a surge of user activity in March 
2014, CMS enhanced Healthcare.gov at the end of February 2014 to 
include the ability for consumers to report relevant life events that 
could impact their eligibility and coverage.

    Question 5. Currently, issuers are following an interim payment 
process by which they are reporting on a monthly basis to CMS what 
subsidy payments should be made to them. When will these payments to 
issuers be reconciled and when will CMS, using their records, develop, 
test and implement the formal payment process using transactions that 
are compliant with industry standards?
    Answer 5. It is my understanding that CMS continues to make 
improvements to the functionality of HealthCare.gov for the 2015 open 
enrollment period, including improvements to the financial management 
processes, and has put in place an interim process to calculate and 
make payments to issuers on time. This process includes regular data 
validation with issuers. This interim process does not impact 
consumers' access to advance payment of premium tax credits or cost-
sharing reductions.

    Question 6. The current essential health benefits benchmark, as 
well as many exchange rules, only apply to 2014 and 2015. Both States 
and insurance carriers need to know as soon as possible if changes are 
likely for 2016. Do you believe these rules need to be changed for 2016 
and beyond? What assurances can you give that States and carriers will 
be involved and notified in a timely manner?
    Answer 6. On January 1, 2014, millions of Americans gained access 
to critical consumer protections in a reformed health insurance market, 
including for the first time, a set of essential health benefits that 
individual and small group market plans must provide. In my role as OMB 
Director, I was not engaged on this topic. That said I understand that 
HHS has had close working relationships with States and the issuer 
community over the past several years. If confirmed, I assure you that 
I will continue to engage States, issuers and all stakeholders to 
ensure that future policy is developed with their input. Getting input 
to ensure that we continue to improve implementation is something I 
think is important.

    Question 7. At least five State-based exchanges, including Oregon, 
Massachusetts, Nevada, Maryland, and Hawaii accepted tens of millions 
of Federal taxpayer dollars but struggled to enroll people into their 
plans. What would you do to recoup the money wasted and ensure that 
future exchange establishment dollars are better spent?
    Answer 7. I believe that we need to determine what went wrong and 
why (and in States where things are going right understand that too). 
In those States where the Federal Government and the taxpayer has had 
funds misused, I believe that we need to use the full extent of the law 
to get those funds back for the taxpayer. Finally, we need to make sure 
that we try to ensure that all those who need access to quality, 
affordable health care receive that access.

    Question 8. Will you attempt to recover any payments to contractors 
who may have acted negligently in building healthcare.gov and its 
related operations or may not have met contract standard of care terms? 
If no, why not?
    Answer 8. If confirmed, I look forward to learning more about this 
important issue and take the action necessary. It is my understanding 
that CMS continues to monitor and manage all of its contracts in 
accordance with the requirements of the Federal Acquisition Regulation. 
If confirmed, I will work with CMS to determine appropriate next steps 
for any contractors who may have acted negligently within the confines 
of Federal acquisition regulations.

    Question 9. The President's 2015 budget indicated that the risk 
corridor program will be budget neutral. Please clarify whether this 
program will be budget neutral every year (versus neutral over a 3-year 
time period) and detail the safeguards in place to protect taxpayers 
from bailing out insurance companies if their losses exceed money 
available for reimbursement in the risk corridor program? In addition, 
where is HHS's statutory authority to reduce the risk corridor program 
payments to insurers on a pro-rated basis?
    Answer 9. The temporary risk corridor provision in the Affordable 
Care Act is an important safety valve for consumers and insurers as 
millions of Americans transition to a new coverage in a brand new 
Marketplace. For consumers, the program will play an important role in 
mitigating premium increases in the early years as issuers gain more 
experience in setting their rates for this new program. Current budget 
projections, including those by the Congressional Budget Office, 
reflect money collected from the risk corridor program will be 
sufficient for payments, allowing the program to be administered in a 
budget neutral manner during the 3-years for which it is authorized. In 
the unlikely event of a shortfall for the 2015 program year, HHS 
recognizes that the Affordable Care Act requires the Secretary to make 
full payments to issuers. In that event, HHS will use other sources of 
funding for the risk corridors payments, subject to the availability of 
appropriations.

    Question 10. A recent report by McKinsey and Co. found that 74 
percent of those selecting a new 2014 plan were previously insured. In 
another McKinsey and Co. survey, only 83 percent of enrollees had paid 
their first month's premiums, bringing the effectuated enrollment rate 
for previous uninsured to 22 percent of this year's enrollees. What 
were the metrics for success for covering the uninsured, and do these 
figures meet that goal? If yes, how?
    Answer 10. The Congressional Budget Office projected that 6 million 
people would obtain health insurance through the Marketplaces, and 
sign-ups indicate that we have surpassed that figure. There are a 
number of different surveys that indicate that the number of Americans 
with health insurance coverage is growing, and the number of 18- to 64-
year-olds who are uninsured is declining. Survey experts agree that 
data collection around prior insurance status leads to widely varying 
estimates depending on how the question is asked, and is prone to 
misinterpretation, so it must be used cautiously.

    Question 11. At your confirmation hearing, you discussed the 
importance of metrics in establishing good health policy. An important 
metric for ascertaining the impact of the health reform law is an 
official count of the number of uninsured who have gained coverage 
under the law. What has HHS done and what will it do in the future to 
measure this number in a manner consistent with how these numbers were 
measured when the law was passed?
    Answer 11. If confirmed, I will be sure that the Department 
continues to work with experts in the field and various survey 
instruments both within HHS and elsewhere to assess the number of 
uninsured and make those findings public.

    Question 12. A statement by CMS Administrator Marilyn Tavenner 
posted on the HHS Web site reads, ``It is important to understand that 
the Hub is not a data base; it does not retain or store information.'' 
However, Government Accountability Office (GAO) Report 13-601 says,

          ``According to CMS, the agency is required to establish Data 
        Use Agreements only with OPM and the Peace Corps because these 
        two entities provide batch files of data for processing data 
        hub queries, which CMS stores in the data hub environment.''

    Please elaborate on what the Office of Personnel Management (OPM) 
and Peace Corps data is stored on the Data Hub, and on whether any 
other data is stored on the Hub.
    Answer 12. It is my understanding that CMS has designed the Hub as 
a routing tool that helps Marketplaces provide accurate and timely 
eligibility determinations. The Hub verifies data against information 
contained in already existing, secure and trusted Federal, State, and 
contractor data bases. I understand from HHS that CMS has security and 
privacy agreements with all entities connecting to the Hub. The Hub is 
not a database; it does not retain or store information. The FFM and 
State-based Marketplace eligibility, redetermination, and appeals 
systems do store certain eligibility and enrollment records in order to 
fulfill specific functions, including helping a consumer with an 
application or eligibility problem. The FFM also stores the OPM and 
Peace Corps files needed to verify eligibility based on whether the 
individual has existing minimum essential coverage through these 
entities.
    The privacy and security of consumer data is a top priority for HHS 
and CMS, and it will remain a top priority for me if confirmed. I 
understand that the Hub and its associated systems have been built with 
state-of-the art business processes based on Federal and industry 
standards. CMS has developed an extremely strong enterprise information 
security program to protect consumer information in a secure and 
efficient manner during open enrollment and beyond. I recognize that 
this is an area that will require ongoing vigilance, focus, and 
iterative improvement.

    Questions 13a-h. In a February 5, 2014, letter to CMS Administrator 
Marilyn Tavenner, I asked the following questions:

    a. Which division within CMS is responsible for managing exchange-
related appeals and which divisions had the ultimate responsibility for 
overseeing the development and operational functionality of the 
exchange appeals process?
    b. How many healthcare.gov appeals has CMS addressed and resolved 
to date?
    c. What is the schedule for resolving the current backlog of 
appeals?
    d. How long does CMS anticipate it will take to resolve the average 
appeal and how is CMS communicating to appellees about the length of 
time for resolution of their appeals?
    e. What is the timeline for building the infrastructure necessary 
to route appeals to the proper channels so that CMS officials can 
address their needs and resolve them expeditiously?
    f. When will consumers be able to file appeals by phone or 
electronically?
    g. What is CMS' rationale for not including the appeals 
infrastructure in the initial phase of the Federal exchange 
functionality?
    h. Why was a contingency plan for handling appeals not developed 
sooner given the lack of infrastructure to handle appeals that was 
present from the launch of the exchanges onward?
    Answers 13a-h. My understanding is that consumers applying for 
health coverage in the Marketplace receive an eligibility determination 
that informs them whether or not they are qualified to purchase 
coverage through the Marketplace or receive financial assistance. 
Consumers who disagree with the determination may request an appeal.
    I further understand that CMS first attempts to resolve the appeal 
directly with the consumer through informal resolution, which involves 
contacting the consumer as expeditiously as possible to work through 
the consumer's concerns. This approach has worked particularly well for 
consumers who filed appeals early in the open enrollment period, before 
system errors were corrected. Many of these consumers have since been 
able to successfully enroll in a qualified health plan and have 
withdrawn their appeals. I also understand that CMS prioritizes 
medically urgent appeals, and as a result, is working to resolve those 
appeals as quickly as possible. CMS is now holding hearings for those 
cases that are not otherwise resolved through an informal process.

Premiums, Co-Pays and Deductibles

    Question 1. President Obama promised that premiums would decrease 
for American families by an average of $2,500 per year. The opposite 
has come true, which outgoing Secretary Sebelius acknowledged when she 
said that ``the increases are far less significant than what they were 
prior to the Affordable Care Act.'' How much has the average premium 
increased in the individual market?
    Answer 1. Before the Affordable Care Act, consumers in the 
individual market frequently saw double digit rate increases for their 
health insurance. The Affordable Care Act is contributing to a slowdown 
in health care spending growth. The Marketplace is encouraging plans to 
compete for consumers, resulting in affordable rates. Average actual 
Marketplace premiums for 2014 were lower than those implied by initial 
Congressional Budget Office (CBO) projections. Additionally, CBO 
revised its projections for future premiums on April 14, 2014 and found 
that the Affordable Care Act's coverage expansion will cost $104 
billion less over the next 10 years than it originally estimated, 
citing lower than expected premiums as a ``crucial factor'' in the new 
estimate.
    It is also important to remember advance premium tax credits will 
lower the actual cost of health insurance premiums for many consumers 
purchasing coverage through the Marketplace. More than 8 out of 10 (85 
percent) of the people who selected a Marketplace plan through the SBMs 
and FFM during the 2014 open enrollment period are eligible to receive 
Federal financial assistance in paying their premiums.
    The Affordable Care Act also contains many tools to keep large 
premium increases in check. For example, the Affordable Care Act 
requires insurance companies to justify rate increase of more than 10 
percent, shedding light on arbitrary or unnecessary costs and 
protecting consumers from unfair rate hikes. The rate review program 
works in conjunction with the 80/20 rule or Medical Loss Ratio rule, 
which requires insurance companies to spend at least 80 percent (85 
percent in the large group market) of premiums on health care, and no 
more than 20 percent (15 percent in the large group market) on 
administrative costs such as executive salaries, marketing, and 
profits.

    Question 2. It is important for individuals and families choosing 
insurance plans on healthcare.gov to understand their total financial 
obligation, including premiums, subsidies, deductibles, co-payments and 
co-insurance. What would you do to better educate consumers and help 
them understand the total cost of products they are buying through the 
Federal marketplace? What changes would you make to healthcare.gov?
    Answer 2. I believe it is critical that consumers have a clear 
understanding of the insurance plans from which they are able to 
choose, including their financial obligations under those plans, such 
as premiums, subsidies, deductibles, co-payments and co-insurance, as 
well as the quality of the plans. If confirmed, I would work to ensure 
that consumers can easily understand and compare the benefits and costs 
presented by each plan. Continuing to refine the consumer shopping 
experience on HealthCare.gov is a top priority for CMS, and will be a 
top priority for me if I am confirmed as Secretary.

    Question 3. In comparing silver-level plans in the exchange to a 
typical employer-sponsored health plan, many individuals are finding 
more of their prescription drugs in higher cost-sharing tiers and fewer 
in-network doctors and hospitals. What steps, if any, would you take to 
ensure that consumers who are buying coverage through the exchanges 
have accurate, easily accessible information about which drugs are 
covered, which doctors are covered, and how much they cost?
    Answer 3. I am committed to ensuring that HealthCare.gov provides 
the key information consumers need to make an informed selection from 
among the plans available to them. The Affordable Care Act requires 
that each plan in the Marketplace include a summary of benefits and 
coverage and a link to the plan brochure, where consumers can learn 
more about which services are covered. If confirmed, I look forward to 
working with you to find ways to expand consumer access to information 
in an affordable manner.

    Question 4. PPACA creates a 90-day grace period for individuals 
with subsidized coverage to pay their premiums before they are fully 
removed from their insurance. Patients are considered covered for this 
entire 90-day period, but insurers are only required to pay claims 
incurred in the first 30 days. That leaves a 60-day gap in which people 
are accessing health care services and incurring costs for which they 
may have no intention to pay. Who will pay the providers for the 
treatments that patients receive during this 60-day period?
    Answer 4. I understand that the Affordable Care Act provides 
individuals receiving a tax credit a 3-month grace period to pay any 
unpaid premiums. This only applies to individuals who have already paid 
their first month's premium in full. The rules governing the grace 
period require plans to notify providers of the possibility for denied 
claims when an enrollee is in the second and third months of the grace 
period. If confirmed, I look forward to working with plans and 
providers to make sure the grace period is implemented in a way to 
reduce adverse effects to plans, providers, and consumers.

    Question 5. What has been the total cost of creating healthcare.gov 
to date? What has been the total cost of ``fixing'' healthcare.gov? 
Please include a detailed accounting of all costs associated with this 
Web site, including (but not limited to) salaries and expenditures, 
contractor costs, and training.
    Answer 5. It is my understanding that as of February 28, 2014, CMS 
has obligated a total of approximately $834 million on Marketplace-
related IT contracts and interagency agreements. These expenditures 
include the Web site and the systems that support enrollment through 
the Marketplace, such as the data services hub as well as other 
supporting IT infrastructure, including cloud computing, to support 
Marketplace IT development.

    Question 6. What financial outlays are expected for fixing the 
backbend of healthcare.gov? Please include a detailed estimate of 
future costs for fixing and maintaining the Web site, including (but 
not limited to) salaries and expenditures, contractor costs, and 
training.
    Answer 6. The President's Budget reflects a need for approximately 
$200 million for all Marketplace-related IT in fiscal year 2015, some 
of which is funded through user fees. Much of this amount reflects 
ongoing operational and maintenance costs of HealthCare.gov, as well as 
continued development.

    Question 7. With the number of PPACA delays and exemptions 
approaching 40, there is a great deal of confusion as to what parts of 
the law are being enforced and which parts will be delayed 
indefinitely. Going forward, how will you approach enforcement of other 
unpopular provisions of the law that are necessary to holding down 
costs?
    Answer 7. I am committed to working with the President, Congress, 
States, and other Federal agencies to continue the implementation of 
the Affordable Care Act in a common sense manner that is consistent 
with the law. If confirmed, I look forward to working with this 
committee to help ensure that health care cost continue their downward 
trend toward affordability.
    Before the Affordable Care Act, consumers in the individual market 
frequently saw double digit rate increases for their health insurance. 
The Affordable Care Act is contributing to a slowdown in health care 
spending growth. The Marketplace is encouraging plans to compete for 
consumers, resulting in affordable rates. Average actual Marketplace 
premiums for 2014 were lower than those implied by initial 
Congressional Budget Office (CBO) projections. Additionally, CBO 
revised its projections for future premiums on April 14, 2014 and found 
that the Affordable Care Act's coverage expansion will cost $104 
billion less over the next 10 years than it originally estimated, 
citing lower than expected premiums as a ``crucial factor'' in the new 
estimate.
    It is also important to remember advance premium tax credits will 
lower the actual cost of health insurance premiums for many consumers 
purchasing coverage through the Marketplace. More than 8 out of 10 (85 
percent) of the people who selected a Marketplace plan through the SBMs 
and FFM during the 2014 open enrollment period are eligible to receive 
Federal financial assistance in paying their premiums.
    The Affordable Care Act also contains many tools to keep large 
premium increases in check. For example, the Affordable Care Act 
requires insurance companies to justify rate increases of more than 10 
percent, shedding light on arbitrary or unnecessary costs and 
protecting consumers from unfair rate hikes. The rate review program 
works in conjunction with the 80/20 rule or Medical Loss Ratio rule, 
which requires insurance companies to spend at least 80 percent (85 
percent in the large group market) of premiums on health care, and no 
more than 20 percent (15 percent in the large group market) on 
administrative costs such as executive salaries, marketing, and 
profits.

    Question 8. Americans between the ages of 18 and 34 are typically 
the healthiest individuals in the population and therefore cost 
insurance companies the least. Yet under PPACA young men and women are 
seeing their insurance premiums double and even triple. This, in 
combination with the new guaranteed issue rules, has created a 
situation in which for many young people remaining uninsured is less 
risky and more financially reasonable than ever before. This is 
evidenced by the enrollment numbers showing young people are enrolling 
at lower than expected rates. What actions should we expect to see from 
you that would address the economic disincentives for young people to 
purchase health insurance under PPACA, and instead create an 
environment where young people are being incentivized to obtain health 
insurance?
    Answer 8. First, the provision that allows young people to stay on 
their parents' plans until they are 26 gives young Americans more 
flexibility early in their careers.
    Additionally, consistent with expectations, through the end of 2014 
open enrollment, the proportion of young adults (ages 18 to 34) who 
have selected a Marketplace plan through the SBMs and FFMs has remained 
strong. We expect that the robust sign-up numbers we are observing in 
the Marketplace's first year--8 million at the close of 2014 open 
enrollment--will encourage insurers to compete on price for consumers 
during next year's open enrollment period. In addition, provisions of 
the Affordable Care Act including, rate review and the medical loss 
ratio rule, will help protect consumers against unfair rate hikes.

SHOP Exchange

    Question 1. Last year, CMS determined that eligible small business 
employees would not be able to select from any health plan on the SHOP 
exchange, but would only be able to enroll in a single health plan of 
the employer's choosing. Then, in November, CMS announced that small 
employers who applied for coverage through the Federal SHOP had to 
start over and apply for coverage directly through participating health 
plans. This was very disruptive to small employers. What steps are 
being taken to ensure that HHS can implement what it had originally 
planned for 2014 that will allow employees to choose from among 
multiple health plans?
    Answer 1. It is my understanding that HHS is continuing to work 
toward implementing employee choice in all SHOPs, because in the long 
run employee choice will bring significant benefits to small business 
owners and their employees. As noted in the March 2014 proposed rule, 
Exchange and Insurance Market Standards for 2015 and Beyond, however, 
some issuers and State insurance commissioners have expressed concern 
that employee choice might significantly disrupt some small group 
markets, and might therefore have a negative effect on the ability of 
small business owners to access coverage. To address these concerns and 
smooth the transition, HHS has proposed, based on the recommendation of 
a State regulatory agency, to not implement employee choice in 2015 if 
doing so is not in the best interest of consumers. I understand that 
HHS issued a propose rule on this topic, and will issue a final rule in 
the near future.

    Question 2. Are CMS, its vendors, and business partners working 
under a coordinated Federal timeline for SHOP Exchange implementation? 
If so, what are the deadlines and key milestones in the timeline? 
Please supply that timeline to the committee.
    Answer 2. In my role as OMB Director, I was not engaged in specific 
deadlines and key milestones on SHOP. It is my understanding, however, 
that CMS continues to work with stakeholders on SHOP. The federally 
facilitated SHOP is open to otherwise eligible employers with 50 or 
fewer full-time-equivalent employees (FTEs) and enrollment is open 
year-round. If confirmed, I will commit to working as expeditiously as 
possible on this important issue.

Employer Issues

    Question 1. The Congressional Budget Office projected in February 
of this year that there would be a decline in the number of full-time-
equivalent workers of ``about 2.5 million in 2024, compared with what 
would have occurred in the absence of the ACA.'' However, Secretary 
Sebelius has denied that PPACA would have any such impact, saying, 
``There is absolutely no evidence--and every economist will tell you 
this--that there is any job loss related to the Affordable Care Act.'' 
Do you agree with Secretary Sebelius, or do you accept the CBO's 
findings that the ACA will result in a decrease in the number of full-
time workers in this country?
    Answer 1. Prior to the Affordable Care Act, many people could not 
leave their jobs because they relied on their jobs for health 
insurance. This ``job lock'' created significant strain both 
economically and personally. Over the longer run, the Affordable Care 
Act will give people more choices and, by providing people with a new 
source of coverage through the Marketplaces, people are now able to 
make employment decisions based on what works best for them, be it 
retiring early, working part-time, or changing to a different job that 
may not offer health benefits. These are active decisions on the part 
of empowered Americans.

    Question 2. After the administration made two major delays to the 
employer mandate, former White House Press Secretary Robert Gibbs said 
that he does not believe the employer mandate will ever go into effect. 
Will the employer mandate go into effect? Will any more delays or 
changes to the employer mandate be made by the administration?
    Answer 2. For businesses with more than 100 employees, the employer 
mandate is scheduled to go into effect in January 2015. As you know, 
employer responsibility provisions are under the purview of the 
Department of Treasury, so I would respectfully refer you to the 
Department of Treasury for additional information regarding this 
question.

    Question 3. Employers have clearly been responding to the 
incentives created by the ACA's definition of ``full-time employment'' 
as 30 or more hours per week. Many employers are cutting hours or 
reducing the size of their workforce to avoid the employer mandate. 
Excepting the multitude of delays of the mandate, how should the 
negative effects of the ACA on the American workforce be addressed? If 
it became apparent that employers continued to be unwilling or unable 
to adhere to the mandate in December 2014, should we expect more 
delays?
    Answer 3. By providing quality, accessible health care coverage 
through the Health Insurance Marketplaces, the Affordable Care Act 
creates additional job mobility, puts small businesses on a level 
playing field with large businesses in the labor market, and enables 
people to make employment decisions that better suit their needs.
    As CBO Director Doug Elmendorf testified, the Affordable Care Act 
``spurs employment and would reduce unemployment over the next few 
years.'' Additionally, CBO estimates indicate that the Affordable Care 
Act will reduce the deficit by about $100 billion over the budget 
window--a benefit for our Nation's fiscal health.

Medicaid

    Question 1. In January, Kaiser Health News reported that problems 
with healthcare.gov were preventing the applications of almost 150,000 
low-income individuals from being transferred to the States for 
Medicaid and Children's Health Insurance Program enrollment. In 
response to this growing problem, Secretary Sebelius said during an 
April 10th Senate Finance Committee hearing that CMS may cut States' 
Federal matching rate for Medicaid funds as an incentive for States to 
clear their transferred application backlogs.
    Are States responsible for the delay in processing applications 
from healthcare.gov?
    Answer 1. It is my understanding from HHS that CMS has been working 
collaboratively with the States in order to achieve a seamless 
eligibility system that provides consumers with a ``no wrong door'' 
approach to accessing affordable health coverage. CMS continues to work 
with these States to achieve this technical capability.

    Question 2. How would cutting State funding that is available for 
processing Medicaid applications improve the process?
    Answer 2. One of the important impacts of the Affordable Care Act 
is a seamless eligibility system that allows consumers to access the 
offer of affordable health coverage through State Medicaid agencies or 
through the Federally Facilitated Marketplace (FFM). CMS has worked in 
partnership with States to achieve improvements to State eligibility 
systems so that seamless access to enrollment can be achieved. If 
confirmed, I look forward to working with you and with States to ensure 
consumers continue to have access to Medicaid.

    Question 3. Are applicants who have been deemed eligible for 
Medicaid on healthcare.gov being counted as Medicaid enrollees by HHS? 
If yes, how many?
    Answer 3. My understanding is that in the regular public reports on 
the Health Insurance Marketplaces, individuals determined or assessed 
as eligible for Medicaid or the Children's Health Insurance Program 
(CHIP) are not included in the FFM enrollment counts. Those 
determinations and assessments are listed elsewhere on the reports.

    Question 4. What is done to inform these individuals on the status 
of their applications?
    Answer 4. It is my understanding from HHS that when an individual 
has applied at the Federally Facilitated Marketplace (FFM) and has been 
determined or assessed as eligible for Medicaid or CHIP, the individual 
receives a notice informing them of that decision and that their 
account is being transferred to the Medicaid agency for enrollment. In 
some cases the individual is contacted directly and encouraged to apply 
directly with the State Medicaid agency.

Medicare

    Question 1. PPACA cut funding for the popular Medicare Advantage 
(MA) program. To date, PPACA has reduced benefits for seniors enrolled 
in MA by roughly $1,500 per beneficiary on average, and used the 
savings to fund new subsidies through the health care exchanges. 
However, only about 20 percent of the ACA mandated cuts to MA have been 
implemented so far. Would you support efforts to repeal these damaging 
cuts, which disproportionately impact low-income seniors who often 
cannot afford a Medigap plan? Or, do you believe it is appropriate to 
cut benefits to seniors to fund a new entitlement program?
    Answer 1. I expect Medicare Advantage (MA) will continue its strong 
performance into the future. With enrollment at an all-time high and 
costs remaining stable, concerns that recent changes to the MA program 
would result in lower enrollment and higher costs have not come to 
fruition. Nationwide, over 15 million Medicare beneficiaries are now 
enrolled in an MA plan. This is a 30 percent increase in enrollment 
since 2010, and enrollment is projected to continue increasing. Plan 
participation continues to be robust with 99.1 percent of beneficiaries 
having access to an MA plan in their area. Since passage of the 
Affordable Care Act, average MA premiums are down by 9.8 percent. 
Robust access, growing enrollment, slow-growing premiums, and stable 
plan choices are all indications that the MA program can be expected to 
remain strong in the coming years. If confirmed, I will ensure that the 
Department continues to closely monitor the program to make sure it 
continues to provide access to Medicare benefits.

    Question 2. The Medicare Part D program is a resounding success, 
coming in more than 40 percent under budget with a customer 
satisfaction rating in the middle 90s. In March, CMS rescinded the ill-
advised proposed Part D rule that garnered bipartisan, bicameral 
opposition because of the drastic effect it would have on seniors. As 
HHS Secretary, would you commit to not implementing any of these 
controversial provisions pertaining to Medicare Part D as included in 
CMS' January 10th proposed rule?
    Answer 2. I understand that the proposed rule included many 
important provisions related to the Medicare Part C and D prescription 
drug program. During the rule's comment period, CMS received numerous 
concerns about some elements of the proposal from Members of Congress 
and stakeholders. In particular, there were concerns raised about the 
proposals to lift the protected class definition on three drug classes, 
to set standards on Medicare Part D plans' requirements to participate 
in preferred pharmacy networks, to reduce the number of Part D plans a 
sponsor may offer, and clarifications to the non-interference 
provisions. Given the complexities of these issues and stakeholder 
input, I understand CMS has previously indicated that the final rule 
will not finalize these proposals.

    Question 3. As HHS Secretary, would you commit to inviting a 
diverse group--including providers, beneficiary/patient advocacy 
groups, payer/plan sponsor groups and other related stakeholders in the 
Part D program--to advise and consult CMS on developing any future 
changes to the program so as to ensure greater transparency and 
collaboration in the rulemaking process?
    Answer 3. If confirmed, I am committed to continuing to work with 
Congress and external stakeholders to ensure that the Part D program 
works best for Medicare beneficiaries while remaining affordable.

    Question 4. I was particularly concerned by CMS' re-interpretation 
of the ``non-interference'' clause in the January proposed Part D rule. 
Has the agency had the opportunity to review this re-interpretation in 
light of the agency's previous 9 years' experience, statements and 
rulemaking--as well as the HHS' OIG interpretation--of ``non-
interference''? Upon completing your review of all these materials, 
would you share your views of CMS' interpretation of the ``non-
interference rule'' as put forward in the January Part D proposed rule?
    Answer 4. It is my understanding that, due to feedback on the 
proposal and the need for more time to consider the policy, CMS does 
not plan to finalize this proposal at this time.

    Question 5. My understanding is that several of the policy changes 
put forth in the proposed Part D rule were based upon incomplete and 
inconclusive data analyses (specifically on networks and mail order/
retail pharmacy costs). None of these studies were reviewed outside of 
CMS. CMS did not release the underlying data behind these studies and 
has not done so to this day. Many commenters (including MedPAC and 
several actuarial firms) have questioned CMS' methodologies behind 
these studies. Would you commit to requiring that CMS either submit 
future internal analyses/studies based on its data to peer-review, open 
public comment, the Office of the Actuary, and/or the Assistant 
Secretary for Policy and Evaluation before permitting their use as a 
basis for future policy changes to the Part D program?
    Answer 5. It is my understanding that data analyses that were used 
as the basis for proposed regulations in the Notice of Proposed 
Rulemaking (NPRM) entitled ``Contract Year 2015 Policy and Technical 
Changes to the Medicare Advantage and the Medicare Prescription Drug 
Benefit Programs'' were cited in the NPRM and made available for public 
comment. This is consistent with longstanding CMS practice in 
rulemaking.
    The CMS Office of the Actuary also prepares independent analysis in 
support of the Regulatory Impact Analysis for proposed and final rules. 
External engagement and input is obtained through the notice and 
comment rulemaking process as well as through the frequent engagement 
between CMS staff and external stakeholders and experts, including 
MedPAC. If confirmed, I look forward to working to ensure that this 
practice is continued and to address any additional concerns you have 
regarding this process.

    Question 6. Under the Sustainable Growth Rate (SGR) rules, the 
Medicare physician fee schedule should see a 20.1 percent cut in 2014. 
What has become known as the ``Doc Fix'' has continuously delayed 
implementing these cuts. If Congress fails to find a solution to the 
rapidly rising cost of Medicare by 2015, PPACA gives members of the 
Independent Payment Advisory Board--or if the board is not yet 
confirmed, the Secretary of HHS--the power to force Medicare cuts that 
would place an increased burden on Medicare Advantage and Medicare Part 
D plans in the first 5 years. How would you, if given the power, 
attempt to find the savings required by PPACA and PAYGO, without 
sacrificing Medicare access and quality?
    Answer 6. The Independent Payment Advisory Board (IPAB) serves as a 
backstop to protect against excessive cost growth in the Medicare 
program. IPAB may not propose increases in cost-sharing or beneficiary 
premiums, restrictions on benefits, rationing of health care, or 
changes in eligibility. According to analysis conducted by the 
independent CMS Actuary for the President's fiscal year 2015 Budget, 
projected that per capita Medicare spending growth will not exceed the 
statutory-based target specified for IPAB until 2019, meaning that 
recommendations would not need to be submitted for congressional 
consideration until at least 2018. The President's fiscal year 2015 
Budget, includes a package of legislative proposals that will save over 
$400 billion over 10 years by more closely aligning payments with costs 
of care, strengthening provider payment incentives to promote high-
quality efficient care and creating incentives for beneficiaries to 
seek high-value services. Enactment of these proposals would delay the 
date of IPAB required recommendations for years beyond 2018.

Employer Wellness Plans

    Question 1. During congressional consideration of the health care 
law, an amendment was adopted related to wellness incentives for 
employees. Wellness plans permit employers to offer incentives to 
employees who participate and achieve improved health outcomes through 
programs targeted at a few conditions that can be managed or improved 
to reduce long-term health effects. These programs help individuals 
lose weight, reduce high blood pressure, manage diabetes and quit 
smoking, for example. Unfortunately, the final rules hamper wellness 
efforts that incentivize employees to achieve a goal. Those employees 
who can't achieve a goal because of an underlying medical condition 
should certainly be exempt or given another alternative. But the final 
rules say that an employee, without a medical reason, must be given 
another option at any time during the plan year. At a time when the 
Administration is working to encourage all Americans, including 
employers, to design and participate in innovative approaches to 
achieving improved health outcomes, would you commit to urging the 
appropriate Federal officials to give employers the regulatory 
flexibility they need, and currently do not have, to innovate and 
motivate employees to work to improve their own health and prevent 
diseases?
    Answer 1. Appropriately designed wellness programs have the 
potential to contribute importantly to promoting health and preventing 
disease. Figuring how to balance the laudable goals of wellness 
programs while ensuring that an employee does not face discrimination 
in eligibility, benefits or premiums based on a health factor, as 
required by the law, is key. I look forward to working with you on 
these issues if confirmed.

Health Insurance Tax

    Question 1. The health insurance tax is levied on all insurers, 
including many Federal programs, Medicare Advantage plans, and Medicaid 
managed care organizations. By taxing these programs, the Federal 
Government has in fact taxed itself (through its subsidization of 
Medicare and--in part--Medicaid) and State governments (through 
Medicaid). How much of the health insurance tax will be borne by the 
Federal and State governments?
    Answer 1. It is my understanding that the annual fee assessed on 
health insurance providers under section 9010 of the Affordable Care 
Act is administered by the Department of Treasury and Internal Revenue 
Service. I therefore respectively refer you to those agencies for 
further information regarding this issue.

Expatriate Health Plans

    Question 1. When PPACA became law, it included dozens of new 
regulations on health insurers, but it did not distinguish between 
health insurance sold to consumers in the United States and expatriate 
health insurance sold to employees and families outside of the United 
States. The House recently passed legislation with bipartisan support 
that would exempt expatriate plans from PPACA given the unique 
challenges of offering this coverage. HHS has already made several 
exemptions for expatriate plans through regulation. Would you support a 
permanent fix in legislation?
    Answer 1. The Administration remains willing to work with the 
Congress to address the special circumstances of expatriate plans and 
to maintain basic consumer protections for all workers. If confirmed, I 
look forward to working with you on this issue.

Regulatory Changes to PPACA

    Question. Please cite the legal authority for each of the following 
delays, waivers, or changes to the statutory requirements in PPACA:

     Medicare Advantage patch: The administration ordered an 
advance draw on funds from a Medicare bonus program in order to provide 
extra payments to Medicare Advantage plans, in an effort to temporarily 
forestall cuts in benefits and therefore delay an early exodus of MA 
plans from the program. (April 19, 2011)
    Answer. The Administration has focused on implementing the 
Affordable Care Act in a common sense manner consistent with the law. 
Ultimately, final actions on implementation efforts rest with the 
relevant agencies. For the issue identified above, the final decision 
was made by HHS. The legal basis for such decisions may be described in 
rulemaking, guidance, or other relevant documents. Should you determine 
those materials do not contain the information you seek, if confirmed, 
I look forward to working with HHS counsel to address your remaining 
concerns.

     Employee reporting: The administration instituted a 1-year 
delay of the requirement that employers must report to their employees 
on their W-2 forms the full cost of their employer-provided health 
insurance. (January 1, 2012)
    Answer. The Administration has focused on implementing the 
Affordable Care Act in a common sense manner consistent with the law. 
Ultimately, final actions on implementation efforts rest with the 
relevant agencies. For the issue identified above, the final decision 
was made by the Department of Treasury. The legal basis for such 
decisions may be described in rulemaking, guidance, or other relevant 
documents. I would respectfully refer you to the Department of Treasury 
for any information about the relevant legal determination not 
contained in those documents.

     Subsidies may flow through Federal exchanges: The IRS 
issued a rule that allows premium assistance tax credits to be 
available in Federal exchanges although the law only specified that 
they would be available ``through an Exchange established by the State 
under section 1311.'' (May 23, 2012)
    Answer. The Administration has focused on implementing the 
Affordable Care Act in a common sense manner consistent with the law. 
Ultimately, final actions on implementation efforts rest with the 
relevant agencies. For the issue identified above, the final decision 
was made by the Department of Treasury. The legal basis for such 
decisions may be described in rulemaking, guidance, or other relevant 
documents. I would respectfully refer you to the Department of Treasury 
for any information about the relevant legal determination not 
contained in those documents.

     Delaying a low-income plan: The administration delayed 
implementation of the Basic Health Program until 2015. This program 
would have provided more-affordable health coverage for certain low-
income individuals who were ineligible for Medicaid. (February 7, 2013)
    Answer. The Administration has focused on implementing the 
Affordable Care Act in a common sense manner consistent with the law. 
Ultimately, final actions on implementation efforts rest with the 
relevant agencies. For the issue identified above, the final decision 
was made by HHS. The legal basis for such decisions may be described in 
rulemaking, guidance, or other relevant documents. Should you determine 
those materials do not contain the information you seek, if confirmed, 
I look forward to working with HHS counsel to address your remaining 
concerns.

     Closing the high-risk pool: The administration decided to 
halt enrollment in transitional Federal high-risk pools created by the 
law, blocking coverage for an estimated 40,000 new applicants, citing a 
lack of funds. The administration had money from a fund under Secretary 
Sebelius's control to extend the pools, but instead used the money to 
pay for advertising for Obamacare enrollment and other purposes. 
(February 15, 2013)
    Answer. The Administration has focused on implementing the 
Affordable Care Act in a common sense manner consistent with the law. 
Ultimately, final actions on implementation efforts rest with the 
relevant agencies. For the issue identified above, the final decision 
was made by HHS. The legal basis for such decisions may be described in 
rulemaking, guidance, or other relevant documents. Should you determine 
those materials do not contain the information you seek, if confirmed, 
I look forward to working with HHS counsel to address your remaining 
concerns.

     Doubling allowed deductibles: Because some group health 
plans use more than one benefits administrator, plans are allowed to 
apply separate patient cost-sharing limits for 1 year to different 
services, such as doctor/hospital and prescription drugs, allowing 
maximum out-of-pocket costs to be twice as high as the law intended. 
(February 20, 2013)
    Answer. The Administration has focused on implementing the 
Affordable Care Act in a common sense manner consistent with the law. 
Ultimately, final actions on implementation efforts rest with the 
relevant agencies. For the issue identified above, the final decision 
was made by HHS along with other agencies. The legal basis for such 
decisions may be described in rulemaking, guidance, or other relevant 
documents. Should you determine those materials do not contain the 
information you seek, if confirmed, I look forward to working with HHS 
counsel to address your remaining concerns.

     Small businesses on hold: The administration has said that 
the Federal exchanges for small businesses will not be ready by the 
2014 statutory deadline, and instead delayed until 2015 the provision 
of SHOP (Small-Employer Health Option Program) that requires the 
exchanges to offer a choice of qualified health plans. (March 11, 2013)
    Answer. The Administration has focused on implementing the 
Affordable Care Act in a common sense manner consistent with the law. 
Ultimately, final actions on implementation efforts rest with the 
relevant agencies. For the issue identified above, the final decision 
was made by HHS. The legal basis for such decisions may be described in 
rulemaking, guidance, or other relevant documents. Should you determine 
those materials do not contain the information you seek, if confirmed, 
I look forward to working with HHS counsel to address your remaining 
concerns.

     Employer-mandate delay: By an administrative action that's 
contrary to statutory language in the ACA, the reporting requirements 
for employers were delayed by 1 year. (July 2, 2013)
    Answer. The Administration has focused on implementing the 
Affordable Care Act in a common sense manner consistent with the law. 
Ultimately, final actions on implementation efforts rest with the 
relevant agencies. For the issue identified above, the final decision 
was made by the Department of Treasury. The legal basis for such 
decisions may be described in rulemaking, guidance, or other relevant 
documents. I would respectfully refer you to the Department of Treasury 
for any information about the relevant legal determination not 
contained in those documents.

     Self-attestation: Because of the difficulty of verifying 
income after the employer-reporting requirement was delayed, the 
administration decided it would allow ``self-attestation'' of income by 
applicants for health insurance in the exchanges. This was later 
partially retracted after congressional and public outcry over the 
likelihood of fraud. (July 15, 2013)
    Answer. The Administration has focused on implementing the 
Affordable Care Act in a common sense manner consistent with the law. 
Ultimately, final actions on implementation efforts rest with the 
relevant agencies. For the issue identified above, the final decision 
was made by HHS. The legal basis for such decisions may be described in 
rulemaking, guidance, or other relevant documents. Should you determine 
those materials do not contain the information you seek, if confirmed, 
I look forward to working with HHS counsel to address your remaining 
concerns.

     Delaying the online SHOP exchange: The administration 
first delayed for a month and later for a year until November 2014 the 
launch of the online insurance marketplace for small businesses. The 
exchange was originally scheduled to launch on October 1, 2013. 
(September 26, 2013) (November 27, 2013)
    Answer. The Administration has focused on implementing the 
Affordable Care Act in a common sense manner consistent with the law. 
Ultimately, final actions on implementation efforts rest with the 
relevant agencies. For the issue identified above, the final decision 
was made by HHS. The legal basis for such decisions may be described in 
rulemaking, guidance, or other relevant documents. Should you determine 
those materials do not contain the information you seek, if confirmed, 
I look forward to working with HHS counsel to address your remaining 
concerns.

     Congressional opt-out: The administration decided to offer 
employer contributions to Members of Congress and their staffs when 
they purchase insurance on the exchanges created by the ACA, a subsidy 
for which the law does not provide. (September 30, 2013)
    Answer. The Administration has focused on implementing the 
Affordable Care Act in a common sense manner consistent with the law. 
Ultimately, final actions on implementation efforts rest with the 
relevant agencies. For the issue identified above, the final decision 
was made by the Office of Personnel Management. The legal basis for 
such decisions may be described in rulemaking, guidance, or other 
relevant documents. I would respectfully refer you to the Office of 
Personnel Management for any information about the relevant legal 
determination not contained in those documents.

     Delaying the individual mandate: The administration 
changed the deadline for the individual mandate, by declaring that 
customers who have purchased insurance by March 31, 2014 will avoid the 
tax penalty. Previously, they would have had to purchase a plan by mid-
February. (October 23, 2013)
    Answer. The Administration has focused on implementing the 
Affordable Care Act in a common sense manner consistent with the law. 
Ultimately, final actions on implementation efforts rest with the 
relevant agencies. For the issue identified above, the final decision 
was made by HHS. The legal basis for such decisions may be described in 
rulemaking, guidance, or other relevant documents. Should you determine 
those materials do not contain the information you seek, if confirmed, 
I look forward to working with HHS counsel to address your remaining 
concerns.

     Insurance companies may offer canceled plans: The 
administration announced that insurance companies may re-offer plans 
that previous regulations forced them to cancel. (November 14, 2013)
    Answer. The Administration has focused on implementing the 
Affordable Care Act in a common sense manner consistent with the law. 
Ultimately, final actions on implementation efforts rest with the 
relevant agencies. For the issue identified above, the final decision 
was made by HHS. The legal basis for such decisions may be described in 
rulemaking, guidance, or other relevant documents. Should you determine 
those materials do not contain the information you seek, if confirmed, 
I look forward to working with HHS counsel to address your remaining 
concerns.

     Exempting unions from reinsurance fee: The administration 
gave unions an exemption from the reinsurance fee (one of PPACA's many 
new taxes). To make up for this exemption, non-exempt plans will have 
to pay a higher fee, which will likely be passed onto consumers in the 
form of higher premiums and deductibles. (December 2, 2013)
    Answer. The Administration has focused on implementing the 
Affordable Care Act in a common sense manner consistent with the law. 
Ultimately, final actions on implementation efforts rest with the 
relevant agencies. For the issue identified above, the final decision 
was made by HHS. The legal basis for such decisions may be described in 
rulemaking, guidance, or other relevant documents. Should you determine 
those materials do not contain the information you seek, if confirmed, 
I look forward to working with HHS counsel to address your remaining 
concerns.

     Extending Preexisting Condition Insurance Plan: The 
administration extended the Federal high risk pool until January 31, 
2014 and again until March 15, 2014, and again until April 30, 2014 to 
prevent a coverage gap for the most vulnerable. The plans were 
scheduled to expire on December 31, but were extended because it has 
been impossible for some to sign up for new coverage on healthcare.gov. 
(December 12, 2013) (January 14, 2014) (March 14, 2014)
    Answer. The Administration has focused on implementing the 
Affordable Care Act in a common sense manner consistent with the law. 
Ultimately, final actions on implementation efforts rest with the 
relevant agencies. For the issue identified above, the final decision 
was made by HHS. The legal basis for such decisions may be described in 
rulemaking, guidance, or other relevant documents. Should you determine 
those materials do not contain the information you seek, if confirmed, 
I look forward to working with HHS counsel to address your remaining 
concerns.

     Expanding hardship waiver to those with canceled plans: 
The administration expanded the hardship waiver, which excludes people 
from the individual mandate and allows some to purchase catastrophic 
health insurance, to people who have had their plans canceled because 
of PPACA regulations. The administration later extended this waiver 
until October 1, 2016. (December 19, 2013) (March 5, 2014)
    Answer. The Administration has focused on implementing the 
Affordable Care Act in a common sense manner consistent with the law. 
Ultimately, final actions on implementation efforts rest with the 
relevant agencies. For the issue identified above, the final decision 
was made by HHS. The legal basis for such decisions may be described in 
rulemaking, guidance, or other relevant documents. Should you determine 
those materials do not contain the information you seek, if confirmed, 
I look forward to working with HHS counsel to address your remaining 
concerns.

     Equal employer coverage delayed: Tax officials will not be 
enforcing in 2014 the mandate requiring employers to offer equal 
coverage to all their employees. This provision of the law was supposed 
to go into effect in 2010, but IRS officials have ``yet to issue 
regulations for employers to follow.'' (January 18, 2014)
    Answer. The Administration has focused on implementing the 
Affordable Care Act in a common sense manner consistent with the law. 
Ultimately, final actions on implementation efforts rest with the 
relevant agencies. For the issue identified above, the final decision 
was made by the Department of Treasury. The legal basis for such 
decisions may be described in rulemaking, guidance, or other relevant 
documents. I would respectfully refer you to the Department of Treasury 
for any information about the relevant legal determination not 
contained in those documents.

     Employer-mandate delayed again: The administration delayed 
for an additional year provisions of the employer mandate, postponing 
enforcement of the requirement for medium-size employers until 2016 and 
relaxing some requirements for larger employers. Businesses with 100 or 
more employees must offer coverage to 70 percent of their full-time 
employees in 2015 and 95 percent in 2016 and beyond. (February 10, 
2014)
    Answer. The Administration has focused on implementing the 
Affordable Care Act in a common sense manner consistent with the law. 
Ultimately, final actions on implementation efforts rest with the 
relevant agencies. For the issue identified above, the final decision 
was made by the Department of Treasury. The legal basis for such 
decisions may be described in rulemaking, guidance, or other relevant 
documents. I would respectfully refer you to the Department of Treasury 
for any information about the relevant legal determination not 
contained in those documents.

     Extending subsidies to non-exchange plans: The 
administration released a bulletin through CMS extending subsidies to 
individuals who purchased health insurance plans outside of the Federal 
or State exchanges. The bulletin also requires retroactive coverage and 
subsidies for individuals from the date they applied on the marketplace 
rather than the date they actually enrolled in a plan. CRS issued a 
memo discussing the legality of these subsidies. (February 27, 2014)
    Answer. The Administration has focused on implementing the 
Affordable Care Act in a common sense manner consistent with the law. 
Ultimately, final actions on implementation efforts rest with the 
relevant agencies. For the issue identified above, the final decision 
was made by HHS. The legal basis for such decisions may be described in 
rulemaking, guidance, or other relevant documents. Should you determine 
those materials do not contain the information you seek, if confirmed, 
I look forward to working with HHS counsel to address your remaining 
concerns.

     Non-compliant health plans get 2 year extension: The 
administration pushed back the deadline by 2 years that requires health 
insurers to cancel plans that are not compliant with PPACA's mandates. 
These ``illegal'' plans may now be offered until 2017. This extension 
will prevent a wave of cancellation notices from going out before the 
2014 mid-term elections. (March 5, 2014)
    Answer. The Administration has focused on implementing the 
Affordable Care Act in a common sense manner consistent with the law. 
Ultimately, final actions on implementation efforts rest with the 
relevant agencies. For the issue identified above, the final decision 
was made by HHS. The legal basis for such decisions may be described in 
rulemaking, guidance, or other relevant documents. Should you determine 
those materials do not contain the information you seek, if confirmed, 
I look forward to working with HHS counsel to address your remaining 
concerns.

     Delaying the sign-up deadline: The administration delayed 
until mid-April the March 31 deadline to sign up for insurance. 
Applicants simply need to check a box on their application to qualify 
for this extended sign-up period. (March 26, 2014)
    Answer. The Administration has focused on implementing the 
Affordable Care Act in a common sense manner consistent with the law. 
Ultimately, final actions on implementation efforts rest with the 
relevant agencies. For the issue identified above, the final decision 
was made by HHS. The legal basis for such decisions may be described in 
rulemaking, guidance, or other relevant documents. Should you determine 
those materials do not contain the information you seek, if confirmed, 
I look forward to working with HHS counsel to address your remaining 
concerns.

     Canceling Medicare Advantage cuts: The administration 
canceled scheduled cuts to Medicare Advantage. The ACA calls for $200 
billion in cuts to Medicare Advantage over 10 years. (April 7, 2014)
    Answer. The Administration has focused on implementing the 
Affordable Care Act in a common sense manner consistent with the law. 
Ultimately, final actions on implementation efforts rest with the 
relevant agencies. For the issue identified above, the final decision 
was made by HHS. The legal basis for such decisions may be described in 
rulemaking, guidance, or other relevant documents. Should you determine 
those materials do not contain the information you seek, if confirmed, 
I look forward to working with HHS counsel to address your remaining 
concerns.

Rights of Conscience

    Question 1. The HHS regulation that all organizations which provide 
health insurance to their employees must provide the full range of 
contraceptive services, with only a few exceptions, flies in the face 
of religious liberty in this country. Is it your intention to maintain 
this requirement even against organizations that claim such a 
requirement violates their deeply held religious beliefs?
    Answer 1. I believe that religious freedom and women's preventative 
health are both important. The Department outlined a clear path forward 
to address religious liberty concerns while ensuring that women have 
access to key preventive services, including contraception. The final 
rule includes an accommodation for non-profit religious organizations, 
such as non-profit religious hospitals and universities that object to 
contraceptive coverage. Non-profit religious organizations are not 
required to provide, fund, administer, or contract or refer for 
contraceptive coverage, but their employees will be automatically 
provided separate contraceptive coverage without cost-sharing. There is 
also an exemption for houses of worship. Houses of worship are not 
required to provide, fund, administer, or contract or refer for 
contraceptive coverage.

    Question 2. President Obama has said he supports current Federal 
laws on protection of conscience rights, such as the Weldon amendment 
and the Church amendment. Do you support these protections? Do you 
intend to give them maximum effect in the way you administer programs 
at HHS?
    Answer 2. I support the protection of conscience rights, and if 
confirmed, I would ensure that HHS programs are administered consistent 
with all Federal laws protecting conscience rights, including the 
Weldon and Church amendments.

    Question 3. Secretary Sebelius has publicly committed to providing 
a list of exchange plans that do not provide abortion coverage, so that 
people can purchase insurance coverage that does not violate their 
conscience. I am unaware of that list having been made public. Please 
provide the list of plans in the State and Federal exchanges that do 
not provide abortion coverage.
    Answer 3. As OMB Director, I was not directly engaged on this 
topic. I understand that CMS is committed to ensuring that 
HealthCare.gov provides the key information consumers need to make an 
informed selection from among the QHPs available to them. Additionally, 
each plan in the Marketplace must include a Summary of Benefits and 
Coverage and a link to the plan brochure, where consumers can learn 
more about which services are covered. If confirmed, I will continue 
the work of the CMS to assure that consumers have access to information 
regarding the coverage they are purchasing in the Marketplaces.

Health IT

    Question 1. As the Meaningful Use Electronic Health Record 
Incentive program winds down in the next few years, do you plan to 
scale back the Office of National Coordinator's (ONC) role and allow 
market forces, patients, and providers, to determine the technologies, 
systems and practices best suited to increase efficiency and the 
quality of care in our health system? How will you ensure that the 
agency stays focused on its convening and coordination role and does 
not stray into over-regulating in ways that stifle Health IT 
innovation?
    Answer 1. ONC was first established in 2004 by Executive order 
during the Bush administration and was established by legislation in 
2009, with the enactment of the HITECH Act, part of the Recovery Act. 
HITECH provided broad, permanent authorities for ONC to promote the 
widespread adoption of standardized and certified health information 
technology, facilitate the secure use and exchange of interoperable 
health information, and promote the delivery of safe, high-quality, 
best-practice care.
    As the Federal entity charged with achieving this vision, ONC 
focuses on high-level coordination across the Administration and with 
the private sector. The agency will continue to serve as convener on 
health IT advancement and innovation in the Nation with the aim of 
enabling and informing health delivery and payment reform and improving 
the public's health. If confirmed, I will work to ensure that ONC 
continues to meet its goals and objectives.

    Question 2. Congress intended the Medicare and Medicaid electronic 
health record (EHR) incentive programs to support widespread adoption 
of interoperable technology to improve health care. A recent report 
from GAO (GAO-14-207) indicates that the first stage of the program has 
led to increased adoption, but noted that program changes make future 
participation difficult to estimate. Indeed, health care providers have 
expressed significant concerns about the readiness of EHR vendors to 
support the mandatory transition to the 2014 Edition Certified EHR in a 
safe and orderly fashion. They also have concerns about the overly 
complex, rigid requirements of the meaningful use program. Why hasn't 
the Administration taken steps to address provider concerns about the 
challenges adopting the 2014 Edition EHRs certified through the HHS 
program? If confirmed, what specific steps will you take between now 
and the end of the fiscal year 2015 to ensure that any provider making 
a good faith effort can meet the requirements?
    Answer 2. I am aware that HHS has been listening to providers, 
health care associations, EHR vendors, and its partners in the health 
care industry. In December 2013, HHS announced that it would engage in 
rulemaking to extend Stage 2 of meaningful use for 1 year and allow 
Stage 3 to begin in 2017. In addition, ONC issued a 2015 Edition EHR 
Certification Criteria Proposed Rule as part of its new regulatory 
approach to provide more frequent updates to the certification 
criteria. This approach is designed to provide more time for public 
input on policy proposals, enable the certification processes to more 
quickly adapt to include newer industry standards that can lead to 
greater interoperability, and add more predictability for EHR 
technology developers.
    By extending Stage 2 until 2017, HHS would have an additional year 
of Stage 2 implementation data to help inform any program changes. An 
extension also allows CMS and ONC to better align quality performance 
measures across Federal programs and to consider effective Stage 3 
approaches to advance interoperability and clinical decision support 
capabilities that will help drive improved health outcomes.
    In response to stakeholder concerns that providers were having 
difficulties meeting the requirements of Stage 2, CMS and ONC announced 
in February 2013 that additional flexibility would be provided that 
would allow eligible professionals and hospitals to request a hardship 
exception because they are unable to control the availability of 
Certified EHR Technology (CEHRT) at a practice location or a 
combination of practice locations.
    If confirmed, I look forward to working with CMS and ONC on these 
ongoing efforts.

Patient Privacy

    Question 1. Since the passage of the Patient Safety and Quality 
Improvement Act of 2005, CMS has engaged in a practice of encouraging 
State Survey Agencies to believe that they are entitled to receive and 
make public patient safety work product (confidential information). In 
spite of the fact that dissemination of this protected information is a 
criminal offense, many hospital executives must make a difficult choice 
between complying with the survey agencies' request and facing other 
survey sanctions. Efforts to get CMS and the Agency for Healthcare 
Research and Quality (AHRQ) to clarify this issue and to avoid 
continued violations of the Patient Safety and Quality Act have failed. 
Will you commit to working with this committee to continue to protect 
patient safety work product and to ensure that CMS and AHRQ do not 
issue policies or guidance or otherwise engage in practices that 
violate this fundamental protection?
    Answer 1. Yes, if confirmed I believe that patient safety should be 
one of the highest priorities and will be happy to review this issue 
with the Department and work with Congress to eliminate the risk of 
future violations.

Food and Drug Administration

    Question 1. I have heard a lot lately about the cost and complexity 
of FDA regulations, and there seems to be a pattern that regulations 
from FDA officials have a well-intentioned goal, but do not provide 
evidence showing how the regulation will achieve the stated goal. As 
one example, the Animal Feed regulation claims reduced risk to humans 
and animals as a benefit, but has no empirical evidence that 
contamination would be less likely if the proposed rule is implemented. 
Would you ensure that cost and complexity of FDA regulations are 
justified to protect the public health, and include evidence to justify 
that conclusion?
    Answer 1. In its rulemaking activities, FDA has complied with the 
numerous Federal requirements to analyze the regulatory impact of each 
proposed rule and to conduct cost/benefit analyses. FDA's goal in 
implementing the FDA Food Safety Modernization Act (FSMA) has been to 
improve public health protections while minimizing undue burdens on the 
affected industry. FSMA provides an opportunity to significantly 
strengthen our food safety system by focusing more on preventing food 
safety problems rather than reacting to problems after they occur. The 
benefits of this shift to a focus on prevention are significant.
    The proposed rule entitled, ``Current Good Manufacturing Practice 
(CGMP) and Hazard Analysis and Risk-Based Preventive Controls for Food 
for Animals'' (preventive controls for animal food proposed rule) would 
require facilities that produce animal food to identify the hazards 
associated with the product and control these hazards. The reduction in 
contaminated food would reduce the risk of illness or injury to 
animals, to humans handling animal food, and to humans consuming food 
products of animal origin, which in turn would generate social benefits 
in the form of potential improvements in public health.
    FDA solicited comment on the Preliminary Regulatory Impact Analysis 
(PRIA) report that accompanied the proposed rule and will carefully 
consider the comments before finalizing the rule.

    Question 2. The FDA recently proposed a ``tentative determination'' 
to ban certain fats, a regulation which has reportedly driven some 
restaurants and food manufacturers to return to using regular liquid 
saturated fats with the same long standing oxidation problems (which 
were determined to lead to cirrhosis of the liver and early death). In 
addition to the increased health concerns with such a ban, this 
``determination'' was issued by FDA without any OMB review even though 
the cost estimate is in the tens of billions of dollars. How did such a 
significant rule escape OMB review? Will you review this policy and 
proposal with an eye toward a true cost-benefit analysis?
    Answer 2. FDA has established procedures under 21 CFR 170.38(b)(1) 
for issuing notices in the Federal Register when proposing to determine 
that a substance is not ``Generally Recognized as Safe'' (GRAS) and is, 
therefore, a food additive subject to section 409 of the Act. In short, 
the procedures include a requirement that FDA place all of the data and 
information it used to make this determination in the public docket, 
and publish a Federal Register notice with the name of the substance, 
its known uses, and a summary of the basis for the determination, for 
public notice and comment. Finally, the procedures require an 
additional Federal Register notice of the final determination, whether 
or not the substance is ultimately found to be GRAS.
    FDA followed these procedures when announcing its tentative 
determination that partially hydrogenated oils are no longer ``GRAS.'' 
In addition, FDA shared a draft of this action with OMB, and we 
reviewed it including evidence of its costs and benefits. The comment 
period for this action closed on January 7, 2014. FDA is in the process 
of considering public comments and determining appropriate next steps.

    Question 3. There was considerable interest in many of the 
decisions made by OMB related to implementation of the Sequester. One 
issue in particular that caused considerable consternation and required 
Congress to intervene was OMB's decision to sequester FDA user fees. 
Were you personally involved in OMB's decisions about how to implement 
the Sequester? Did you have a role in the decision to sequester FDA 
user fees? Do you believe that sequestration was the appropriate course 
of action for private industry-funded fees? Can you provide the 
specific statutory reference that mandates that privately paid user 
fees be sequestered by the government? What criteria did OMB use to 
deem a user feed ``voluntary'' versus ``involuntary''? Would you commit 
to maintain the use of FDA user fees only for their intended and 
authorized purpose, and not for redirection to deficit reduction or 
other activities?
    Answer 3. Determinations regarding the application of sequestration 
to specific accounts are made by OMB's Office of General Counsel, in 
consultation with the relevant agency general counsel. The vast 
majority of such determinations were made before I became Director, 
including the determination regarding FDA user fees, and thus I was not 
personally involved in those determinations.
    That said, the Balanced Budget and Emergency Deficit Control Act of 
1985 (BBEDCA), as amended, provides the Administration with little 
flexibility with respect to the application of sequestration. As set 
forth in BBEDCA, sequestration reduces budgetary resources in all 
budget accounts, unless expressly exempted by the law.
    Consistent with what OMB has stated in response to previous 
inquiries on this topic, the determination that FDA user fees are 
subject to sequestration is consistent with long-standing, 
governmentwide application of the relevant provisions. Both BBEDCA and 
the Congressional Budget and Impoundment Control Act of 1974 provide 
that the authority to spend offsetting collections, such as FDA user 
fees, constitutes budgetary resources. As mentioned above, 
sequestration reduces budgetary resources in all budget accounts, 
unless expressly exempted by the law. No such exemption from 
sequestration applies to FDA's authority to spend offsetting 
collections.
    Pursuant to BBEDCA, sequestered FDA user fees remain as an 
unavailable balance in FDA's Salaries and Expenses account and may not 
be used for other purposes. Congress can appropriate that funding in 
subsequent years, as it did in fiscal year 2014.

Early Childhood Development

    Question 1. In 2012, the Government Accountability Office cited 
over 45 programs that may provide services for early childhood 
development, 12 of which have an explicit program purpose of providing 
early learning or child care services. If confirmed as Secretary, how 
will you work to allow States to implement GAO's recommendation to 
improve coordination among these programs in order to reduce program 
fragmentation and streamline the numerous early childhood programs the 
Federal Government funds, including those housed at the Department of 
Health and Human Services?
    Answer 1. Over the past several years, the Administration has been 
aggressively addressing alignment of early childhood programs by 
working toward aligning standards, streamlining monitoring, and 
coordinating technical assistance and professional development efforts, 
among other activities.
    The Early Head Start-Child Care Partnerships (EHS-CCP) are an 
example of our strong commitment to alignment across programs. These 
grants are breaking down the barriers between two programs and in doing 
so enhancing their quality and reach. EHS-CCP grants align the Early 
Head Start and child care programs and provide more of our Nation's 
children and families with high quality early learning experiences that 
will set them up for success in school and beyond.
    The Administration plans to continue building on alignment efforts 
to develop and strengthen a seamless, high quality continuum of early 
education for children and families birth to school entry. It's 
important to keep in mind however, that the most significant problem we 
face is access to high quality early education. Even Early Head Start, 
the largest Federal early childhood program for infants and toddlers, 
only serves about 4 percent of all eligible children. We are not even 
close to filling the need, although the $500 million Congress provided 
in the Omnibus is welcomed and will expand access to high-quality care 
for infants and toddlers through partnerships and Early Head Start 
expansion.
    If confirmed, I will continue to work with States and our partners 
across the Federal Government to assure strong alignment, with the goal 
of giving every child the early experiences that set them up to achieve 
their full potential, which directly affects our country's competitive 
edge in a global economy.

    Question 2. If confirmed as Secretary, how will you create an 
environment to free up States to overcome the fragmentation that exists 
among early childhood programs so that they can serve a greater number 
of families while minimizing unwarranted overlap and reducing 
conflicting and inappropriate Federal mandates on what States do with 
limited Federal funds?
    Answer 2. If confirmed, I will build on the work that has begun at 
the Department to reduce any potential overlap and fragmentation in 
these important programs. For example, the EHS-CCPs demonstrate the 
Administration's strong commitment to eliminating fragmentation and 
aligning programs at the Federal level, while also expanding the reach 
and enhancing the quality of early education for children across the 
country. States and local communities across the country, as well as 
non-profit and for-profit agencies, are eligible to apply for these 
grants, creating an important opportunity for Federal-State and within-
State policy alignment across child care, Head Start, and other early 
learning programs.
    HHS is working toward ensuring statewide coordination and 
collaboration among the wide range of early childhood programs and 
services in the State through State advisory councils. If confirmed, I 
will continue the work that has begun at the Department on this effort.

    Question 3. How can the Department of Health and Human Services 
help States have more control over Federal early childhood development 
programs so that States can determine the best methods of mixed 
delivery models that includes services provided by private providers, 
including child care centers that work for their populations?
    Answer 3. States across the country are taking the lead in 
expanding early education programs around the country. States like West 
Virginia, Georgia, and Oklahoma are doing incredible work using mixed 
delivery models that work for their children and families.
    If confirmed, I look forward to working with States to make 
existing programs work better for them and for the young children and 
families that are depending on us to level the playing field, and give 
them a real shot at success by identifying best practices in States and 
supporting the sharing of information.

Head Start Program

    Question 1. The implementation of the process required under the 
Head Start Act of 2007 under which underperforming Head Start grantees 
must re-compete in order to continue operating those centers was a 
dramatic improvement in the management of the Head Start program; now, 
Head Start grantees are more accountable for performance and 
maintaining the standards of the program. Will you commit to continuing 
this competitive process to re-designate Head Start grantees with 
questionable performance, and how might this process inform the way the 
Department of Health and Human Services manages other Federal programs 
and grants serving children?
    Answer 1. If confirmed, I commit to continuing the Designation 
Renewal System (DRS) under which underperforming grantees must compete 
for funding. Additionally, I am committed to ensuring that the system 
promotes high quality services for children and families and continuous 
improvement for grantees. I will look at the results of the DRS 
evaluation once it is completed to assess its successes and challenges 
and to determine if it is applicable to other programs within the 
Department.

    Question 2. The Head Start Act of 2007 authorized the designation 
of some 200 Centers of Excellence as a means to support best practices 
in early childhood programs as well as improve the dissemination of 
those practices to other Head Start centers and service providers. In 
2009, HHS designated 10 Head Start Centers of Excellence and provided 
funding to support such activities through 2014. If confirmed as 
Secretary, will you commit to support effective implementation of the 
Centers of Excellence concept as a means to develop and disseminate 
best practices in order to improve the outcomes for Head Start 
participants?
    Answer 2. Yes, I commit to continuing to learn from the Centers of 
Excellence specifically and from local innovation generally. It is 
essential that local programs inform our understanding of best 
practices. The Centers of Excellence designation and funding has 
allowed programs to sustain best practices and disseminate information 
to other Head Start programs. Funding was previously provided to 
support one cohort of Centers of Excellence grants, and their period of 
performance ends in 2014. However, during the next year I understand 
that HHS will review the effort to see what it can learn from the 
program and how that information can be used going forward.

Child Abuse Prevention and Treatment

    Question 1. A 2014 report by the Government Accountability Office 
found that Federal agencies have provided limited support in the form 
of training, guidance and resources, Federal funding, and data 
collection related to child sexual abuse. Furthermore, these efforts 
are not well coordinated or disseminated. Most States and local 
officials are not aware of the Federal resources that are currently 
available and have been left to address sexual abuse and misconduct 
with minimal Federal guidance.

    As the principal Federal agency that provides oversight, training, 
and education to States and local officials on implementation of 
Federal child abuse and welfare requirements, how do you plan to 
strengthen the child abuse, neglect prevention, and treatment programs 
to raise awareness and reduce the incidents of child abuse and neglect 
nationwide?
    Answer 1. This is an important issue and a priority in terms of 
protecting some of our Nation's most vulnerable children. The 2014 GAO 
report referenced, Child Welfare: Federal Agencies Can Better Support 
State Efforts to Prevent and Respond to Sexual Abuse by School 
Personnel, is specific to sexual assault by school personnel. It 
provides a review and assessment of efforts to address child sexual 
abuse by school personnel. As such, GAO's recommendations focus 
primarily on how the Department of Education should take action to 
prevent and respond to child sexual abuse by school personnel in 
collaboration with the Secretary of HHS and the Attorney General to 
leverage resources, expertise and capacities departments.
    The purview of HHS through the Children's Bureau is the oversight 
of child welfare services, including the prevention of abuse and 
neglect of children by parents and caregivers as defined by State 
statute. In this capacity, efforts are underway to raise awareness and 
prevent the sexual abuse of children. Work includes the Children's 
Justice Act (CJA), the Community-Based Child Abuse Prevention Program 
(CBCAP), the Child Welfare Information Gateway and the annual 
Prevention Resource Guide.
    If confirmed, I will continue to advance the current programmatic 
and awareness initiatives and partner with the Department of Education 
to assist with further efforts to address child abuse through 
leveraging resources, expertise and capacities across departments.

    Question 2. What steps will you take to work with the U.S. 
Departments of Education, Justice, and other Federal agencies to 
strengthen the coordination of the child abuse and neglect programs to 
ensure greater efficiency and focus for direct services?
    Answer 2. If confirmed, I look forward to working with the 
Departments of Education, Justice, and other Federal agencies to 
strengthen the coordination of child abuse and neglect programs. The 
Department has managed efforts to broadly share and disseminate 
information, promote awareness, and create, foster and implement 
opportunities for collaborative efforts to address child abuse and 
neglect, including through the Federal Interagency Workgroup on Child 
Abuse and Neglect (FEDIAWG), which provides a forum for staff from 
Federal agencies to share and disseminate information, promote 
awareness, and create, foster and implement opportunities for 
collaborative efforts to address child abuse and neglect.

Child Care and Development Block Grant

    Question 1. The U.S. Senate recently passed the Child Care and 
Development Block Grant of 2014. If this reauthorization proposal 
becomes law, would the regulations proposed by the Department of Health 
and Human Services (45 CFR part 98) be withdrawn and new regulations 
proposed that fit within the framework authorized by Congress?
    Answer 1. Should Congress pass and the President sign legislation 
to reauthorize the Child Care and Development Block Grant program, the 
Administration would revisit the rule as part of its work to implement 
the new statute.

    Question 2. How will the Department of Health and Human Services 
work to support services like those under the Child Care and 
Development Block Grant that provide States with flexibility to 
implement programs in a manner that meets the need of the State and 
encourages parental choice in order to meet the individual needs of 
residents?
    Answer 2. I understand that the Child Care and Development Block 
Grant provides State, territory, and tribal grantees with flexibility 
to meet the needs of low-income families and children within their 
jurisdiction, and I look forward to working with you to ensure that the 
program best meets the needs of those it serves. I understand that HHS 
has established national centers to provide technical assistance on 
topics such as child care quality improvement and subsidy innovation 
and accountability, as well as worked collaboratively with States, 
territories, and tribes through onsite visits and regional meetings. As 
implemented, the CCDF program ensures parental choice to a wide variety 
of child care providers--with over 460,000 providers participating 
across a range of settings, including centers and family child care 
homes.
                              senator enzi
    Questions 1a-e. The enrollment period for 2015 health plans was 
originally scheduled to run from October 15 to December 7, but the 
Administration has pushed the opening date back passed the mid-term 
elections so that the enrollment period will run from November 15 
through January 15. Secretary Sebelius told me last month that this 
change was done in collaboration with insurers looking at their 
calendar. Which insurers did HHS collaborate with to make this change?
    a. Which insurers supported the move?
    b. Which insurers opposed the move?
    c. What costs will taxpayers incur because of this move?
    d. What costs will insurers incur because of this move?
    e. If this is not information available to you yet, and if you are 
confirmed, will you commit to providing full and complete answers to 
each of the above questions within 1 month of your confirmation.
    Answer 1a-e. As OMB Director, I was not directly engaged on this 
topic. However, I understand that this past March, the Department 
shifted open enrollment for the 2015 plan year by approximately 1 month 
because the unique, initial open enrollment period lasted through 
March. Open enrollment will now begin on November 15, 2014 and will end 
on February 15, 2015. This shift is beneficial for both consumers and 
insurers. It gives consumers more time to learn about plans and select 
a plan and it also gives insurers the benefit of more time to monitor 
2014 enrollments, prior to submitting their 2015 rates. If confirmed, I 
want to work with you to ensure that we continue the opportunity for 
the public to give input and comment on regulations to ensure continued 
access to quality, affordable health care coverage.

    Questions 2a-d. As Director of OMB, you are responsible for 
coordinating and reviewing all significant Federal regulations. Between 
the day you were confirmed as OMB Director and this week, there were 30 
Affordable Care Act final or interim rules released, including the 
employer mandate delay. What legal analysis did you use to approve that 
rule since the Affordable Care Act expressly states the mandate should 
take effect in 2014?
    a. What economic analysis did you use to justify this delay but not 
a delay of the individual mandate or the other burdensome provisions of 
this law?
    b. As OMB director, did you require an analysis on the impact of 
this change on the taxpayer?
    c. If not, why not?
    d. Were you surprised when CBO subsequently found that it would 
cost the taxpayers $12 billion?
    Answer 2a-d. OMB reviews regulations to determine whether, among 
other things, the benefits of rules justify their costs; the rules are 
consistent with, and non-duplicative of the regulations and activities 
of other Federal agencies; the rules explore reasonable alternatives 
and examine flexibility for small businesses; the agency is using the 
most up-to-date scientific, technical, and other information; and the 
rule accomplishes its goals in the least burdensome way possible. These 
and other principles are spelled out in more detail in Executive Orders 
12866 and 13563. OMB also runs an interagency review process on rules 
it reviews so that other relevant agencies in the Federal Government 
can provide their views.
    In general, the Administration's approach to regulation is to 
maintain a common-sense balance between our obligation to protect the 
health and safety of Americans and our commitment to promoting economic 
growth, job creation, and innovation. The regulations that OMB reviewed 
over the Administration's first 5 years are expected to have an overall 
value to society worth about $200 billion annually when implemented, 
even after considering potential costs. The Affordable Care Act and the 
rules that implement it have significant economic benefits. For 
example, in its most recent baseline estimate, CBO reaffirmed that the 
Affordable Care Act as a whole will decrease both short-term and 
longer-term Federal deficits.
    With respect to the IRS employer mandate rule, that rule was not 
reviewed by OMB. Because of a longstanding agreement between Treasury 
and OMB, dating back to the Reagan administration, OMB does not 
typically review IRS rules and has not reviewed any IRS rules related 
to the Affordable Care Act while I have been Director.

    Question 3a. During your tenure at OMB, we saw a massive failure of 
Healthcare.gov--a Web site the Administration had 3 years and $600 
billion to build. As Director of OMB, you are responsible for oversight 
of agency performance and information technology. While you said HHS 
and your CIO oversaw the role out, as the head of OMB, what oversight 
role did you play in approval of the Web site?
    Answer 3a. As Director of OMB, I had no involvement in the 
technical development, operation, or approval of the Web site. OMB's 
oversight responsibilities were in two main areas: (1) facilitating 
interagency technical coordination through OMB's Office of E-Government 
& Information Technology; and (2) regular Affordable Care Act budget 
and policy work through OMB's Health Resource Management Office (RMO). 
As Director of OMB, I was responsible for overseeing the efforts of 
these two offices.

    Question 3b. What is being done to protect taxpayers from making 
erroneous payments?
    Answer 3b. OMB is working closely with the Departments of Treasury 
and Health and Human Services to ensure oversight and prudent use of 
Federal funds in the programs established under the Affordable Care 
Act. As with other programs, agencies must follow a number of statutory 
requirements including risk assessments and, when applicable, reporting 
an improper payment rate and implementing corrective actions. In 
addition, agencies are responsible for establishing internal controls 
to provide assurance for effective program operations, reliable 
financial reporting, and compliance with laws and regulations.
    In service of this effort, I would encourage Congress to provide 
sufficient funding for key operational activities--and in particular, 
program integrity efforts--at both HHS and the IRS. These efforts will 
help ensure accurate and timely payments, and remediate erroneous 
payments should they occur.

    Questions 4a-c. In February the New York Times reported that one in 
five people who complied with the individual mandate didn't pay their 
premiums in January. At that time a CMS spokesman said the 
Administration couldn't say how many people had paid their premiums. On 
April 30, the House Energy and Commerce Committee reported that only 67 
percent of enrollees had paid their first premium by April 15.
    a. While the Administration disputes this figure, you've yet to 
release your own official numbers. If confirmed, will you commit to 
determining who has paid their premiums and is actually ``covered'' as 
required by the individual mandate and providing that information to 
Congress within 60 days of your confirmation?
    b. If confirmed, how will you measure success of Obamacare--based 
on folks who sign-up for coverage or based on folks who pay their 
premiums and are actually covered?
    c. If confirmed, what will you do about people who thought they 
were covered, sought healthcare, and now have medical bills but no 
insurance?
    Answer 4a-c. It is my understanding from HHS that a group of 
insurers recently testified before the House Energy & Commerce 
Committee, and stated that 80 to 90 percent of enrollees have paid 
their premium.\1\ If confirmed, I will continue the Department's 
longstanding practice of focusing on providing reliable, complete and 
accurate information. When HHS has accurate and reliable data regarding 
premium payments, I will ensure that it is made available to the 
public.
---------------------------------------------------------------------------
    \1\ http://www.bloomberg.com/news/2014-05-06/insurers-say-most-
obamacare-customers-paid-first-premiums.html.
---------------------------------------------------------------------------
    From my perspective, the success of the Affordable Care Act is 
about access, affordability and quality. If I am confirmed, I will work 
to make sure that individuals have the best clarity possible on their 
coverage status.

    Question 5. In March I asked you how the Administration would 
ensure that the Preschool for All initiative is not duplicative of Head 
Start, the Child Care Development Block Grant, or other programs 
authorized through No Child Left Behind, the Individuals with 
Disabilities Education Act, and numerous other laws. You acknowledged 
the need for such an effort and suggested some general tools the 
Administration could use to align the programs, but if confirmed, you 
would be specifically charged with coordinating these programs and 
eliminating duplication.
    One way you could do that is by undertaking a review of the 
duplication and overlap in early childhood education programs and 
submitting a plan to Congress on ways to consolidate and streamline the 
various programs. In fact, the Senate adopted my amendment to the CCDBG 
reauthorization bill in March to do just that. The vote on my amendment 
was 98-0, so I think it's a common sense approach. And I don't think 
you have to wait for that language to be signed into law to start the 
review.
    If confirmed, would you commit to conducting that review and 
submitting a plan to Congress on ways to reduce duplication and overlap 
of early childhood programs within 1 year?
    Answer 5. Yes, if confirmed I am committed to improving 
coordination and reducing duplication. I will continue the efforts the 
Department has already started to better coordinate early childhood 
programs including aligning technical assistance, standards, monitoring 
and professional development to use of Federal resources to provide 
services to more children and families in an efficient and effective 
manner.
    With respect to the GAO report, it is my understanding HHS is 
working with the Department of Education to align programs and ensure 
that they are working well for States, communities and children. One 
challenge is access to high quality early education. Even Early Head 
Start, the largest Federal early childhood program for infants and 
toddlers, only serves about 4 percent of all eligible children. As HHS 
continues working with our Partners across the government to assure 
strong alignment, we must keep in mind that we are far from reaching 
our goal of giving every child the early experiences that set them up 
to achieve their full potential, which directly affects our country's 
competitive edge in a global economy.
                            senator isakson
    Question 1. For many residents of rural areas, the ``Affordable 
Care Act'' is proving to be anything but affordable. For example, in 
southwest Georgia, the cheapest ``bronze'' plan has a premium of over 
$12,000 per year--and that's for a plan with a $12,600 deductible. A 
March 19 article in The Hill, titled ``O-Care premiums to skyrocket,'' 
quoted insurance officials stating that rates are likely to double or 
even triple in some parts of the country. According to the article, 
``areas of the country with older, sicker, or smaller populations are 
likely to be hit hardest.'' Do you believe the rates facing southwest 
Georgians constitute ``affordable care''? If confirmed, would you work 
with Congress to find ways to allow our constituents to have access to 
lower rates, such as by rolling back excessive regulations that drive 
up the cost of coverage?
    Answer 1. If confirmed, I am committed to working with Congress to 
help all Americans access affordable health care. The Administration 
has promoted greater competition of insurance companies in rural 
American through the Multi-State Plan and CO-OP Programs. One out of 
every four issuers in the Marketplace in 2014 newly offered such 
coverage. The Affordable Care Act also offers all consumers, including 
those in rural Georgia, tools to make insurance more affordable--
insurance affordability programs, including premium tax credits and 
cost-sharing reductions, will help many eligible individuals and 
families, significantly reducing the monthly premiums and cost-sharing 
paid by consumers. Premium tax credits may be paid in advance and 
applied to the purchase of a QHP through the Marketplace, enabling 
consumers to reduce the up front cost of purchasing insurance. In 
addition, cost-sharing reductions will lower out-of-pocket payments for 
deductibles, coinsurance, and copayments for eligible individuals and 
families.

    Question 2. It has been widely reported that under prior 
leadership, the Office of Management and Budget (OMB) directed agencies 
to postpone the publication of economically significant regulations, 
including a number of regulations implementing the Patient Protection 
and Affordable Care Act (PPACA), until after the November 2012 
presidential election. Additionally, the Department of Health and Human 
Services has postponed the start of 2015 open enrollment from October 1 
to November 15, 2014--a change that you approved in your capacity as 
OMB director. Do you believe that the date of Federal elections is ever 
an appropriate factor to consider when HHS sets timelines for 
implementing PPACA and other legislation enacted by Congress?
    Answer 2. As we implement laws, I think it is important we do so in 
a way that protects the health, welfare, and safety of Americans while 
promoting economic growth, job creation, competitiveness, and 
innovation. With regard to rulemakings in particular, I believe it is 
important that, among other things, the benefits of rules justify their 
costs and that regulations are tailored in such a way so as to impose 
the least burden on society while still accomplishing their goals. 
These factors and others are set out in more detail in Executive Orders 
12866 and 13563, and OMB Circular A-4, which is a guidance document to 
all agencies on how to conduct regulatory analysis.
    The goals of the Affordable Care Act are to give millions of 
middle-class Americans health care security, slow the growth of health 
care costs, and bring transparency and competition to the Health 
Insurance Marketplace. In implementing this law or any others, I think 
it is important to focus on accomplishing the mandates and goals of the 
law in the most effective, efficient and common sense way possible.

    Question 3. In 2011, Georgia enacted legislation at the State level 
permitting insurers to offer policies that have been licensed in other 
States. Section 1333 of PPACA directs the Secretary of HHS, in 
consultation with the National Association of Insurance Commissioners 
(NAIC), to issue regulations no later than July 1, 2013, providing for 
the establishment of ``health care choice compacts'' under which States 
could enter into reciprocal arrangements for the sale of health 
insurance across State lines. However, over 10 months later, no 
proposed regulations on this topic have been published in the Federal 
Register. What is the status of implementing section 1333, and has HHS 
initiated consultations with NAIC on developing proposed regulations?
    Answer 3. As OMB Director, I have not been directly engaged on this 
topic. That said, I understand that HHS continues to work in close 
partnership with the NAIC on many components of Affordable Care Act 
implementation, and I look forward to building on that work if 
confirmed.

    Question 4. PPACA's medical loss ratio (MLR) rule requires 
insurance companies to spend at least 80 percent of premiums (85 
percent for insurers in the large-group market) on paying medical 
claims. HHS has interpreted this rule to include commissions paid to 
independent insurance agents and brokers in the denominator of medical 
loss ratio, even though this compensation is not actual revenue to the 
insurer. As a result, commissions have been cut significantly reducing 
consumers' access to independent agents and brokers. In November 2011, 
the National Association of Insurance Commissioners adopted a 
resolution urging that, ``Congress should expeditiously consider 
legislation amending the MLR provisions of PPACA in order to preserve 
consumer access to agents and brokers.''
    Do you agree that commissions to independent agents and brokers 
should not be included in the MLR calculation? If confirmed, would you 
work with Congress to enact legislation that excludes agent and broker 
commissions from the MLR?
    Answer 4. As OMB Director, I have not been directly engaged on this 
topic. I understand that agents and brokers act as trusted counselors, 
providing service at the time of plan selection and enrollment and 
customer service throughout the year and if confirmed, I am happy to 
continue to work with Congress to help agents and brokers continue to 
play this important role. I understand from HHS that the MLR regulation 
adopted the recommendations of the National Association of Insurance 
Commissioners (NAIC), including the NAIC recommendations on the 
treatment of agent and broker fees and commissions. Data collected by 
the NAIC Health Care Reform Actuarial Working Group in 2011 showed that 
prior to the Affordable Care Act, agent and broker commissions were 
first rising at the same rate as health care premiums, and then began 
to decline steadily. This data suggests that commissions began to 
decline prior to the passage of the Act and that issuers may have had 
business considerations that influenced their decision to reduce 
commission rates other than the MLR requirements.

    Question 5. In implementing the health insurance exchanges, the 
Administration has prioritized navigators and other ``assisters'' over 
State-licensed insurance agents and brokers. I have heard from agents 
and brokers who have expressed strong frustration with the lack of 
tools available to them to assist consumers in exploring coverage 
options through the healthcare.gov Web site. What role do you envision 
for licensed agents and brokers in future exchange enrollment periods?
    Answer 5. My understanding is that agents and brokers will continue 
to play a vital role in enrolling individuals and businesses in 
coverage, as they do today. Agents and brokers act as trusted 
counselors, providing service at the time of plan selection and 
enrollment and customer service throughout the year.

    Question 6. In February, National Review reported that the Illinois 
Department of Insurance revoked the certification of a PPACA navigator 
after being informed by the U.S. Attorney for the Eastern District of 
Michigan that she had been convicted in 1969 for participating in a 
series of terrorist attacks in Israel, including one bombing that 
killed two people. Georgia, along with several other States, has 
enacted legislation requiring navigators to undergo criminal background 
checks. Do you believe the Federal Government should require background 
checks for all navigators who receive taxpayer funding and have access 
to consumers' personal information?
    Answer 6. It is my understanding that HHS is working to provide 
consumer assistance that balances the provision of high-quality 
consumer information with consumer protections. In addition to the 
rules set forth in the law, funding announcement, and regulations 
related to Navigators, recipients of Navigator grants in the FFMs, like 
other entities and individuals seeking to conduct business with the 
Federal Government, were subjected to a robust screening process before 
the grants were awarded.\1\ Awardees must also meet any licensing, 
certification, or other standards prescribed by the State or 
Marketplace, if applicable, so long as these State Navigator standards 
do not prevent the application of the provisions of Title I of the 
Affordable Care Act. As of April 2014, 18 States with FFMs have set 
additional requirements for Navigators. If confirmed, I will continue 
to ensure that consumers are protected and the standards of these 
programs are adhered to.
---------------------------------------------------------------------------
    \1\ Entities and individuals are not eligible for a Federal grant, 
including a Navigator grant in an FFM, if they are on the General 
Services Administration's web-based System for Award Management 
containing the names of entities or individuals who have been suspended 
or debarred by any Federal agency. Screening applicants using this 
system will help to ensure that individuals or organizations that pose 
a risk to the Federal Government are not awarded Federal Navigator 
grants.

    Question 7. Insurance agents and brokers are generally required to 
purchase professional liability insurance. Given the risk of identity 
theft or data breaches whenever personally identifiable information is 
shared, do you believe entities that receive taxpayer funds to conduct 
navigator or other consumer outreach activities should be required to 
carry liability insurance?
    Answer 7. While I have not been directly engaged on this issue as 
OMB Director, I understand from HHS that all Navigator grant awardees 
must meet any licensing, certification, or other applicable standards 
prescribed by the State or Marketplace so long as these State Navigator 
standards do not prevent the application of the provisions of Title I 
of the Affordable Care Act. If confirmed, I look forward to learning 
more regarding this issue and understanding any concerns you have 
regarding the insurance needs of these entities.

    Question 8. Section 1342 of PPACA provides for the establishment of 
a temporary risk corridor program for health insurance companies in the 
individual and small group markets. The law specifies that the program 
is to operate for calendar years 2014, 2015 and 2016. In February, the 
Washington Examiner reported that the Administration is considering a 
plan to extend the risk corridor program beyond 2016. In your view, 
does the Secretary of HHS have statutory authority to implement an 
extension of the risk corridor program?
    Answer 8. The temporary risk corridor provision in the Affordable 
Care Act is an important safety valve for consumers and insurers as 
millions of Americans transition to a new coverage in a brand new 
Marketplace. For consumers, the program will play an important role in 
mitigating premium increases in the early years as issuers gain more 
experience in setting their rates for this new program. To my 
knowledge, the Department has no plans to administratively extend the 
temporary risk corridors program beyond 2016.

    Question 9. Please describe your perspective on the role of the 
Centers for Disease Control (CDC) in monitoring, investigating, and 
responding to serious public health threats. If confirmed as Secretary, 
how would you ensure that the work of CDC and other public health 
initiatives is appropriately prioritized within a Department that has 
recently been more focused on administering health coverage programs?
    Answer 9. I believe CDC has an important role in monitoring, 
investigating, and responding to serious public health threats. Just 
this past week, CDC announced that the first two cases of Middle East 
Respiratory Syndrome (MERS) have arrived in the United States. These 
cases are a reminder of the centrality of CDC to protecting the health 
of Americans, and are also a reflection of how our capabilities to 
detect and respond to such threats have improved since H1N1. The 
President's fiscal year 2015 budget includes new resources for CDC to 
address priority threats, and I am committed to working with Congress 
to ensure that critical CDC capabilities are supported.

    Question 10. It is imperative for CDC to have the resources 
necessary to carry out its core mission of protecting Americans from 
public health threats. In recent years, a significant portion of the 
CDC's budget has been backfilled from the Prevention and Public Health 
Fund created in PPACA. As a result, the amount of discretionary funding 
for CDC in the President's fiscal year 2015 budget request is nearly 10 
percent less than the agency received in fiscal year 2010. How will you 
work to ensure that CDC continues to receive adequate resources once 
the Prevention and Public Health Fund has been exhausted?
    Answer 10. I agree that CDC needs to have the resources needed to 
carry out its core mission. The recent U.S. cases of Middle East 
Respiratory Syndrome (MERS) remind us that new threats continually 
emerge to challenge our capabilities. The President's fiscal year 2015 
Budget includes new investments in Advanced Molecular Detection that 
were made through the fiscal year 2014 appropriations process, along 
with the President's fiscal year 2015 request for new investments in 
protecting against antimicrobial resistance are examples of how we can 
ensure such progress.
    The Prevention and Public Health Fund (PPHF) together with annual 
appropriations have supported a broad range of CDC initiatives. Under 
provisions of the Affordable Care Act, the PPHF is newly appropriated 
and allocated each fiscal year, meaning it is renewed and expended 
annually; it is not a time-limited funding stream and will continue 
each year unless changed by law.
    If confirmed, I will continue to work with the Administration and 
Congress to ensure that critical CDC capabilities are supported and 
that appropriate and sustainable funding sources are used to achieve 
this goal.

    Question 11. One of the Surgeon General's statutory roles is to 
oversee the U.S. Public Health Service Commissioned Corps, which 
provides medical response for national and local emergencies including 
natural disasters and terrorist attacks as well as carrying out a 
variety of other public health missions. Some have criticized the 
President's current nominee to this position for lacking substantial 
on-the-ground public health experience. In your view, how do the 
Surgeon General's office and the Commissioned Corps fit into the 
overall mission of the Department of Health and Human Services?
    Answer 11. The Department is the principal Federal agency for 
protecting the health of all Americans and providing essential human 
services, especially for those who are least able to help themselves. 
As one of the seven uniformed services of the United States, the 
Commissioned Corps includes 6,800 officers stationed around the world 
furthering the HHS mission, with a particular focus on furthering the 
Department's strategic initiatives including: eliminating health 
disparities through delivering health services to underserved and 
vulnerable populations; protecting American's health and safety during 
emergencies and fostering resilience in response to emergencies; and a 
variety of other functions related to promoting the health of the 
Nation.
    The Corps' role in emergency and crisis response is unique in 
providing not only medical resources, but the broadest spectrum of 
public health resources. I am aware that within the past 2 years, its 
officers and multi-disciplinary response teams were deployed to 
Hurricane Sandy (14 response teams and over 500 officers), the Sandy 
Hook shootings, the Boston Marathon bombings, Saipan, the Crow Nation, 
and in support of numerous National Special Security Events.
    In addition to overseeing the U.S. Public Health Service, the 
Surgeon General provides Americans with the best scientific information 
available on how to improve their health and reduce the risk of illness 
and injury through Surgeon General's Reports and Publications. If 
confirmed, I look forward to working with this office to ensure that it 
continues to achieve its mission.

    Question 12. The Food and Drug Administration (FDA) has a difficult 
balance to strike between protecting consumers from unsafe or 
ineffective medical treatments and ensuring that they have access to 
innovative products that prevent disease or extend life. Recently, 
there have been many cases where Americans are unable to obtain 
products years after they have been approved in other countries. For 
example, despite rapidly growing rates of melanoma with nearly 10,000 
deaths in 2013, the FDA has not approved any new sunscreen ingredients 
since the 1990s, with eight pending applications awaiting approval 
since 2002. Many of these sunscreen ingredients are widely available in 
Europe and other countries. While I am encouraged that the FDA has 
committed to work with Congress to find a solution to the sunscreen 
issue, I am concerned that this is just one example of a broader 
problem of inertia at the agency. Do you believe the FDA is currently 
striking the right balance between safety and innovation?
    Answer 12. I agree that FDA has an important role in both ensuring 
safety and effectiveness and in supporting innovation. The agency is 
committed to finding ways to ensure that safe and effective products 
can get to the people who need them as swiftly as possible.
    I understand that FDA's accelerated approval pathway has helped 
bring innovative drugs to market for patients suffering from serious or 
life-threatening illness, who have limited or no treatment options, as 
soon as it can be concluded that the therapies' benefits justify their 
risks.
    If confirmed, I look forward to working with you in ensuring the 
integrity of a review process that promotes effectiveness and safety 
while also encouraging innovation.

    Question 13. Development of new drugs and medical devices is a 
high-risk, high-cost endeavor for many reasons, not least of which is 
the lengthy FDA approval process. For businesses and entrepreneurs 
investing in research and development, it is important for the FDA's 
regulatory approach to have predictability and certainty. One tool for 
improving regulatory certainty is the Special Protocol Assessment 
process, under which the FDA and an applicant enter into an agreement 
on the design of a clinical trial and what results will need to be 
demonstrated for a drug or biologic to be approved. The FDA recently 
revoked a Special Protocol Assessment days before the deadline for the 
agency to make a final decision on approval of a product. In response 
to concerns expressed by several members of this committee, the FDA 
stated that such a revocation is appropriate whenever there is a 
``paradigm shift'' in how the agency thinks about a scientific 
question. Unfortunately, this is just one example of an agency culture 
that often seems ignorant of how its decisionmaking can affect the 
willingness of the private sector to make the investments necessary to 
bring innovative products to market. If confirmed as Secretary, what 
steps would you take to ensure that the FDA develops a predictable 
regulatory culture that is conducive to maintaining America's global 
leadership in medical innovation?
    Answer 13. Having spent time in the private sector, I appreciate 
the importance of as much predictability as possible. I also appreciate 
the importance of safety and effectiveness. I understand that FDA is 
also developing performance metrics that align with program 
requirements to help drive outcomes. If confirmed I look forward to 
working with you and with FDA to understand how we can better maximize 
innovation, effectiveness, and safety.

    Question 14. As scientists gain a greater understanding of the 
human genome, we are moving into an era of ``personalized'' or 
``precision'' medicine in which it is increasingly possible to predict 
which treatments will be effective for individual patients. In the 
past, a clinical trial in which only 5 percent of patients demonstrated 
improvement might have been labeled a failure, but that is not the case 
if researchers can determine what genetic factors can be used to 
identify that 5 percent. What kinds of changes need to occur in Federal 
regulatory and reimbursement policies to ensure that patients can 
receive the benefits of precision medicine?
    Answer 14. Over the past few years, a number of products that 
signal a new era of medical product development have entered the market 
or come on the horizon. In just the last 2 years, for example, I 
understand that FDA approved new cancer drugs for use in patients whose 
tumors have specific genetic characteristics identified by a companion 
diagnostic test. FDA also approved a new therapy for use in certain 
cystic fibrosis patients with a specific genetic mutation. Each of 
these examples demonstrates the promise of ``personalized medicine,'' 
which tailors medical treatment to the individual characteristics, 
needs, and preferences of each patient. If confirmed, I look forward to 
working with Congress on how these new tools can best be deployed to 
efficiently and effectively serve patients.

    Question 15. Regenerative medicine therapies aim to augment, 
repair, replace or regenerate cells, tissues or organs in order to 
restore or establish function. Research on regenerative medicine, 
including ethical stem cell research that does not involve the 
destruction of a living embryo, holds great promise to develop cures 
for a broad range of debilitating diseases. A 2006 HHS report 
recommended a coordinated Federal approach to supporting regenerative 
medicine, warning that U.S. leadership in this area is ``in danger of 
being eclipsed'' by foreign governments' initiatives. What actions 
would you take as Secretary to improve coordination of HHS activities 
affecting regenerative medicine research and development?
    Answer 15. If confirmed, I would continue to work to bolster the 
many activities underway at HHS in this area and encourage the 
continued coordination of regenerative medicine research across the 
Federal Government. Within HHS, NIH and the FDA have key roles in 
supporting the development of regenerative medicine and facilitating a 
coordinated Federal approach.
    NIH-funded research is exploring potential clinical applications in 
regenerative medicine, as well as studying the molecular pathways in 
biological development and human disease. In fiscal year 2013, NIH 
awarded $831 million for regenerative medicine research. I understand 
from HHS that formal coordination in regenerative medicine research 
occurs in part through the Multi-Agency Tissue Engineering Science 
(MATES) Interagency Working Group, which is currently chaired by the 
FDA. MATES aims to maximize the benefits to society of the Federal 
investment in tissue science and engineering.
    Through cross-agency research and coordination activities, HHS 
plays a central role in supporting regenerative medicine research, and, 
if confirmed, I would seek to foster and strengthen those activities.

    Question 16. The National Cancer Institute at the National 
Institutes of Health (NIH) provides cancer-center support grants to 
research institutions that have received a cancer-center designation. 
The allocation of these grants appears to be based primarily on grant 
amounts from prior years, and I have also heard concerns that political 
factors have played a role in setting grant levels. Georgia currently 
has among the lowest per-capita funding levels of any State with an 
NCI-designated cancer center. If confirmed, would you commit to working 
to ensure that this and other funding streams at NIH are allocated in a 
merit-based manner?
    Answer 16. It is my understanding from HHS that at the request of 
the NCI Director, the National Cancer Advisory Board (NCAB), the NCI's 
external advisory group, recently reviewed the NCI's policies for 
allocation of funds to NCI-designated Cancer Centers to determine 
whether historical funding patterns unduly influenced current Cancer 
Center Support Grant (CCSG or P30) awards and, if so, consider whether 
or not alternative approaches should be explored. The NCAB working 
group, which represented a diverse subset of NCI-designated cancer 
centers, concluded that significant disparities exist in the sizes of 
CCSG awards due to factors other than current merit, including 
longevity, size of the NCI budget in the application year, and 
historical performance. Further, these disparities have been 
perpetuated due to outdated cancer center grant funding policies. The 
working group offered recommendations designed to resolve these 
disparities by changing the way grant funding is calculated. The NCI is 
now working closely with the NCAB to refine the recommendations, and 
design an appropriate implementation strategy.
    If confirmed, I would work with the NCI to ensure that the changes 
made in these policies are successfully executed.

    Question 17. According to a recent report by the University of 
California (Davis) Comprehensive Cancer Center, racial and ethnic 
minorities make up less than 5 percent of participants in NIH-funded 
cancer clinical trials. The lack of diverse participation in clinical 
trials is particularly troubling as medical research increasingly 
focuses on genetic biomarkers, and the reasons for this disparity are 
still poorly understood. If confirmed, will you make it a priority to 
support research aimed at increasing minority participation in 
federally funded clinical trials?
    Answer 17. Inclusion by sex/gender, race, and ethnicity is 
important in clinical research. For example, the National Cancer 
Institute (NCI) is currently implementing the NCI Community Oncology 
Research Program (NCORP), which supports cancer research in the 
community setting, with access to larger and more diverse patient 
populations. If confirmed, I will continue to work to reduce 
disparities and improve outcomes for underserved populations.

    Question 18. Earlier this year, President Obama signed into law a 
bipartisan reauthorization of the Children's Hospital Graduate Medical 
Education (CHGME) program. The purpose of this program, which has 
consistently received overwhelming bipartisan support in Congress, is 
to ensure that children's hospitals receive the same support that other 
teaching hospitals receive through Medicare GME payments. In fact, the 
CHGME program supports training for half of our Nation's pediatric 
workforce.
    Although the CHGME program pays significantly less per resident 
than Medicare, the President's fiscal year 2015 budget proposal calls 
for eliminating CHGME and directing most of its funding into a new pool 
of money for which residency programs that already receive Medicare GME 
payments would be eligible. If confirmed, will you work with Congress 
to support and strengthen the CHGME program?
    Answer 18. Ensuring all individuals, including children, have 
access to health care is a priority for this Administration. As such, 
the President's Budget for fiscal year 2015 includes a new workforce 
proposal, the Targeted Support for Graduate Medical Education program, 
which will train 13,000 new providers over the next 10 years--
responding directly to the documented need for primary care providers, 
as well as other subspecialties experiencing an inadequate supply. It 
also aims to redesign residency training to produce the next generation 
of providers with skills aligned to provide care based on new models of 
health care delivery.
    This proposal sets aside $100 million a year set for the first 2 
years for CHGME. In addition to this $100 million set aside, pediatric 
hospitals and providers would have an opportunity to compete in the 
broader pool for additional resources. The Administration is deeply 
committed to strengthening the health workforce and prioritizes the 
importance of making investments in the pediatric workforce as a 
component of that effort. While we outlined a high-level approach to 
making investments in GME in our budget, we are very open to working 
with Congress to make adjustments to this proposal in ways that are 
informed by the full range of considerations raised by stakeholders and 
members. If confirmed, I look forward to working with you and other 
Members of Congress to ensure that the goals of this program are 
realized.

    Question 19. The 340B drug discount program administered by the 
Health Resources and Services Administration (HRSA) is a vitally 
important program that enables safety-net hospitals and clinics to 
purchase outpatient prescription drugs at discounts comparable to what 
the government receives through Medicaid. Because the criteria for 
determining a hospital's 340B eligibility are largely based on how many 
Medicaid patients the hospital treats, participation in the program has 
grown substantially over time and is poised to expand even further in 
States that have chosen to implement PPACA's Medicaid expansion. If 
confirmed, would you be willing to engage in a dialog about how to 
better identify the true safety-net providers who bear most of the 
burden of indigent care and who should be the primary focus of programs 
such as 340B?
    Answer 19. HHS recently submitted a rule on the 340B program for 
OMB review. It is OMB's longstanding policy not to comment on rules 
under review. That said, we would welcome you or your staff to come in 
and share your views on the rulemaking with us, and updated information 
on the status of any review can be monitored at: www.reginfo.gov.

    Question 20. Ensuring access to life-saving trauma care has long 
been one of my top health care priorities. Trauma is the leading cause 
of death for Americans under age 45. Although getting seriously injured 
patients to Level 1 trauma centers can reduce the chance of death by up 
to 25 percent, 45 million Americans currently lack timely access to 
high-level trauma care. Partly due to financial pressure, nearly one-
third of trauma centers have closed since 1990. Congress has authorized 
funding through the Public Health Service Act to support trauma centers 
and improve trauma systems and access. However, the Administration has 
not requested funding for any of these programs. Hospitals often report 
that they have to use various Medicare payment streams to cross-
subsidize their trauma care, meaning that the burden of financing 
trauma access is falling on taxpayers even in the absence of direct 
Federal support. If confirmed, how will you seek to prioritize ensuring 
access to high-quality trauma care?
    Answer 20. Health care coalitions (HCCs), supported through the 
ASPR Hospital Preparedness Program, help ensure the provision of 
medical care when certain emergencies exceed the limits of a 
community's medical capabilities. HCCs are collaborative networks that 
include local and State trauma centers, in addition to hospitals, 
health care organizations, emergency medical services, long-term care 
facilities, dialysis centers, behavioral health, public health 
departments, emergency management, law enforcement, and other public 
and private sector health care partners within defined regions. These 
networks help mitigate the overwhelming demands of causalities and 
other traumatic incidents by enhancing the movement of information, 
resources, and patients across a community during both routine and 
disaster responses. HCCs aim to develop a support system that is 
gradually less dependent of Federal resources and provides increased 
opportunities for community-based response to emergencies. If 
confirmed, I will work with the ASPR to help ensure HCCs continue to 
address trauma care needs.

    Question 21. HRSA's Organ Procurement and Transplantation Network 
is in the process of considering possible revisions to regional organ 
allocation boundaries with the goal of reducing wait times. Although 
the principles developed by OPTN's liver committee call for maintaining 
geographically contiguous regions, hospitals in Georgia have expressed 
alarm that two proposed options reportedly under consideration by the 
committee would place Georgia in a region with Pennsylvania, New York, 
West Virginia, and western Ohio, potentially disadvantaging Georgia 
transplant patients. Will you commit to ensuring that any new map is 
developed in an open and transparent manner with full opportunity for 
public input?
    Answer 21. In my capacity as OMB Director, I have not been engaged 
in the specific issue that you raise and look forward to learning more 
if confirmed. Reducing geographic disparity in liver allocation is 
critical to ensuring patient access to necessary transplantation. If 
confirmed, I will ensure than any discussions on liver allocation 
polices are governed by clear regulatory requirements, including a 
strong emphasis on transparency and opportunity for public comment.

    Question 22. Obesity is a serious public health problem in our 
country. I believe there are basically two approaches we can take to 
confronting this challenge. One is to educate and empower people to 
make healthier diet and exercise choices for themselves and their 
families, which I believe is the better and more effective approach. 
The other alternative is to tax and regulate and try to use the power 
of the government to stop people from making choices that are viewed as 
unhealthy. What do you believe is an appropriate role for HHS in 
combating obesity?
    Answer 22. I agree that we need to do a better job of educating and 
empowering people to make better choices regarding nutrition and 
physical activity. I also believe that everyone has a role to play in 
improving nutrition and physical activity choices and weight outcomes, 
including: individuals, families, caregivers, schools, local community 
leaders, businesses, the media, and all levels of government.
    HHS plays a vital role in tracking trends in obesity by demographic 
group, conducting research to understand the causes of obesity, as well 
as developing and testing interventions at the individual and community 
level (including partnering with State and local jurisdictions and 
other organizations) to develop approaches to facilitating 
environmental changes so that the easy choice is the healthy choice.
    The Department is starting to see some early indications that 
individual and environmental changes are having an impact. In some age 
groups and in some cities and States, rates of childhood obesity are 
declining. If confirmed, I look forward to continuing the work of the 
Department on this critically important issue.

    Question 23. Some proponents of ``behavioral economics'' suggest 
that government should adopt policies that attempt to ``nudge'' people 
in the direction of making choices that government officials view as 
better or healthier, without outright regulation or prohibition of 
alternatives. Do you believe this is an appropriate role for the 
Federal Government?
    Answer 23. Many parts of the U.S. tax structure are set up to 
incentivize activity that will be of benefit to individuals and society 
as a whole, from mortgage interest deductions, to deductions for 
contributions to charitable organizations, to a number of provisions 
designed to encourage individuals to save for retirement. Policymakers 
have the option of considering a range of tools in developing and 
implementing policy. If confirmed, I would welcome understanding any 
specific ideas that you have in this area.

    Question 24. The last few years have seen a notable increase in 
consolidation among health care providers, particularly with respect to 
hospitals buying physician practices. Proponents of consolidation argue 
that it will allow for better integration and coordination of care, 
while skeptics have expressed concern that it will increase the market 
power of large health care systems, enabling them to charge higher 
prices. Which of these perspectives do you find more persuasive?
    Answer 24. I am aware that hospital acquisitions of other health 
care entities, such as physician practices, by hospitals have been 
commonplace in the last few years. It is my understanding that one of 
the ways CMS is encouraging competition is through the operation of the 
Medicare accountable care organizations (ACOs). I believe that 
competition among ACOs will foster improvements in quality, innovation, 
and choice for Medicare beneficiaries. The antitrust agencies 
(Department of Justice and Federal Trade Commission) are monitoring the 
competitive effects of ACOs. These agencies issued guidance for 
providers seeking to become ACOs and established a voluntary expedited 
review process to give feedback to providers on potential anti-
competitive activities.
    In addition, the testing of the Advance Payment ACO model has led 
to increased participation by smaller organizations in the Medicare 
Shared Savings Program, thus increasing competition.

    Question 25. As regulatory and reimbursement systems become more 
complex, they can create an advantage for large companies or 
organizations that have the resources to navigate bureaucratic hurdles. 
This is of particular concern as the Federal Government's influence 
over health care continues to expand. How will you ensure that HHS 
regulatory and reimbursement decisions do not become a tool for 
established players in the health care market to freeze out competition 
and block innovative new ideas?
    Answer 25. It is my understanding that the Department shares your 
concerns and is working to ensure that providers are able to care for 
their patients without excessively burdensome and unnecessary 
regulations. CMS recently announced a rule that included reforms to 
Medicare regulations identified as unnecessary, obsolete, or 
excessively burdensome on hospitals and other health care providers 
will save nearly $660 million annually, and $3.2 billion over 5 years. 
By eliminating stumbling blocks and red tape we can assure that the 
health care that reaches patients is more timely, that it's the right 
treatment for the right patient, and greater efficiency improves 
patient care across the board. If confirmed, I will continue to support 
the important work of CMS in this area.

    Question 26. Health-related activities carried out by different 
agencies, both within and outside HHS, create the potential for 
wasteful duplication of effort. For example, a recent GAO report found 
substantial duplication among autism research initiatives sponsored by 
seven different HHS agencies, as well as the Department of Defense, the 
Department of Education, and the National Science Foundation. What 
actions can the HHS Secretary take to improve coordination among 
different agencies working on similar projects?
    Answer 26. Based on my understanding, NIH funded the majority of 
federally funded autism-related research from fiscal years 2008 through 
2012. Therefore, coordination among the NIH Institutes and Centers 
(ICs) that fund autism research represents a large component of HHS' 
ongoing efforts to avoid unnecessary duplication in research. To 
achieve this coordination, NIH has an internal Autism Coordinating 
Committee (ACC), which include staff from the National Institute of 
Mental Health (NIMH), the Eunice Kennedy Shriver National Institute of 
Child Health and Human Development (NICHD), the National Institute of 
Neurological Disorders and Stroke (NINDS), the National Institute on 
Deafness and Other Communication Disorders (NIDCD), and the National 
Institute of Environmental Health Sciences (NIEHS). ACC members 
collaboratively plan and co-fund major autism-related research 
initiatives and scientific workshops. Moreover, they share information 
related to autism research activities at their respective Institutes, 
including information about activities in which the NIH ICs participate 
or coordinate with other Federal agencies. They also share information 
they learn about nongovernment-funded autism research through 
participation in scientific meetings and other activities sponsored by 
non-government organizations. Therefore, collaborations and information 
exchanges through the NIH ACC provide important opportunities for 
averting unnecessary duplication before it happens, both within and 
beyond the NIH.

    Question 27. According to the most recent projections by the 
Congressional Budget Office, mandatory spending on HHS programs--
including Medicare, Medicaid, CHIP, health insurance subsidies, and 
family support and foster care--is projected to total over $1.05 
trillion in fiscal year 2015, while the total amount of all 
discretionary spending controlled by Congress will be $1.11 trillion. 
The growing share of Federal spending that is effectively on 
``autopilot'' makes it increasingly difficult for Congress to produce a 
fiscally responsible balanced budget. However, the President's fiscal 
year 2015 budget for HHS proposes to shift a number of programs that 
have historically been funded through the discretionary budget to 
mandatory spending. Under what circumstances do you believe it is 
appropriate to take programs out of the normal budget and 
appropriations process and move them to mandatory status? If Congress 
were to adopt a 2-year budget cycle, along the lines of bipartisan 
legislation I have proposed with Sen. Jeanne Shaheen, would it become 
feasible to shift more programs out of mandatory funding and back into 
the regular budget and appropriations process?
    Answer 27. The President's Budget renews our commitment to critical 
health care and workforce services now, before these essential programs 
expire, to continue the momentum built in the last 5 years. As we look 
to full implementation of the Affordable Care Act this year and beyond, 
there is still work to be done to ensure that essential health 
services, like primary care and mental health care, reach all 
Americans. These investments, which aim to improve access to health 
care and our health workforce, are challenging and take several years 
to realize results. It is important that we make a commitment to our 
communities, universities, and training partners that go beyond 1 year, 
and it is not uncommon to request mandatory funding for such 
investments.
    One area where we have requested additional mandatory funding is 
for the Health Centers Program. The President's Budget plans for a 
surge in newly insured patients in fiscal year 2015 through fiscal year 
2018. Those who are now eligible for insurance through the Marketplaces 
or Medicaid expansion are historically low-income Americans who have 
relied on health centers for discounted care. These patients are likely 
to continue seeking care at health centers because of the high patient 
satisfaction rate, availability of comprehensive services, and 
established relationships with doctors and staff. Further, health 
centers will continue to serve patients who are medically underserved, 
as well as provide services that are not typically covered by 
insurance.
    In another case, the Administration has requested $319 million in 
discretionary funding for the Health Care Fraud and Abuse Control 
Program (HCFAC) and $378 million in proposed new mandatory funding for 
HCFAC. Starting in fiscal year 2015 the Administration is requesting 
that all additional HCFAC funds be mandatory, instead of through the 
discretionary cap adjustment included in the Budget Control Act. This 
would provide a dedicated, dependable source of additional resources to 
perform program integrity activities, which often require a multi-year 
commitment, primarily in the Medicare and Medicaid programs.
    The Administration has not taken a position on moving to a biennial 
budget cycle nor on the specific legislation you mention, but is always 
open to working with Congress on new ways to advance the goal of 
greater certainty in the budget process. With respect to biennial 
budgeting, this approach has both advantages and disadvantages. On one 
hand, in theory it could help facilitate greater budgetary certainty, 
better agency planning, and more time to focus on execution and 
effectiveness. On the other hand, there are good reasons to believe 
that biennial budgeting may not advance the goal of a regular budget 
process that functions smoothly and provides certainty, and could 
potentially lead to unintended consequences such as increased reliance 
on supplementals or a further drawn-out budget process that would not 
achieve the goals. If confirmed, I look forward to working with the 
Congress on HHS' fiscal year 2015 Budget request.
                              senator kirk
    Question 1. CMS recently instituted a policy change for certain 
products used to treat rheumatoid arthritis (RA) to ensure patients who 
cannot self-administer have access to the physician administered form 
of the product. Don't you believe that CMS should apply this policy 
change consistently to all products within the class, including Humira, 
to ensure patients have equal access to all products as needed?
    Answer 1. I understand from HHS that CMS did not institute a policy 
change for drugs to treat rheumatoid arthritis (RA). Under the Social 
Security Act, drugs that are not usually self-administered are payable 
under Medicare Part B. CMS has defined ``not usually self-
administered'' to be not administered by the patient 50 percent or more 
of the time. The decision about whether a drug is ``not usually self-
administered'' is generally left to the Medicare Administrative 
Contractors. In the case of one RA drug, CMS made a decision last Fall 
that the drug meets the criteria to be paid under Medicare Part B 
because the data demonstrated that it is not usually self-administered. 
In the case of Humira, both Medicare's contractors and CMS reviewed the 
data and found that the drug is usually self-administered by the 
patient.

    Question 2. Ms. Burwell, HHS recently renewed an Action Plan for 
the Prevention, Care and Treatment of Viral Hepatitis which seeks to 
increase the number of individuals diagnosed and reduce transmission of 
these diseases. If confirmed, will you continue to focus, cross agency, 
attention on addressing the viral hepatitis epidemic and implementing 
the Action Plan? Hepatitis C could be eliminated in our lifetime if 
appropriate attention is paid to addressing this public health need. As 
you consider key issues to focus on as Secretary will you include viral 
hepatitis on that list?
    Answer 2. Yes, if confirmed I will focus on this issue and continue 
the CDC's critical work in this area. CDC estimates that between 3.5 
and 5.3 million Americans are living with chronic viral hepatitis due 
to hepatitis B and/or hepatitis C, and don't know it. This places these 
Americans at risk for severe, even fatal complications from these 
infections and increases the likelihood that they might unknowingly 
transmit the infection to others. If confirmed, I will ensure that HHS 
continues to support the implementation of a national, coordinated 
strategy to prevent viral hepatitis and to improve health outcomes for 
those who are already infected.

    Question 3. A number of the most innovative and effective anti-
cancer drugs that have been--and are--under development are oral drugs. 
In many cases, oral chemotherapy is the only treatment available. 
Unfortunately, while intravenous treatments are covered under a health 
plan's medical benefit, requiring only a small co-pay, oral 
chemotherapy drugs are often covered under the health plan's 
prescription benefit which results in patients being responsible for up 
to thousands of dollars in out-of-pocket costs per treatment cycle. 
Senator Franken and I introduced S. 1879 to remedy this issue. Can you 
describe for this committee your views on this important problem and 
commit to working with me and others on the committee and other 
stakeholders on potential legislative and regulatory solutions to this 
urgent issue?
    Answer 3. As OMB Director, I was not directly engaged on this 
topic. I understand that regulations implementing the Affordable Care 
Act provide detail on how health insurance plans in the individual and 
small group markets must provide the Essential Health Benefits (EHB). 
These regulations include cost-sharing protections that limit the 
amount of out-of-pocket expenses consumers and their families can be 
subject to, as well as anti-discrimination provisions that ensure that 
qualified health plans (QHPs) do not employ benefit designs that 
discriminate against individuals with significant health needs.
    Additionally, I understand that in March 2014, the Centers for 
Medicare & Medicaid Services (CMS) issued the 2015 Letter to Issuers in 
the Federally Facilitated Marketplace, to provide guidance for issuers 
on how CMS would review plans submitted for the 2015 plan year to 
ensure non-discrimination in QHP recent guidance from benefit design. 
Specifically, CMS will perform an outlier analysis on QHP cost-sharing 
as part of the QHP certification application process. QHPs identified 
as outliers may be given the opportunity to modify cost-sharing for 
certain benefits if CMS determines that the cost-sharing structure of 
the plan submitted for certification could have the effect of 
discouraging the enrollment of individuals with significant health 
needs. CMS's outlier analysis will compare benefit packages with 
comparable cost-sharing structures to identify cost-sharing outliers 
with respect to specific benefits, including but not limited to 
prescription drugs.
    I have not yet reviewed S. 1879, but am told that the provisions in 
the current regulations and guidance provide strong consumer 
protections. However, if confirmed, I look forward to working with you 
on any additional concerns you may have.

    Question 4. FDA has indicated that they would like to regulate in 
the area of advanced diagnostic lab tests. Accordingly, they have 
developed a draft guidance which I understand has been pending review 
at OMB for over 2 years. In a November 2013 commentary in the New 
England Journal of Medicine, FDA Commissioner Peggy Hamburg and NIH 
Director Francis Collins stated that ``putting in place an appropriate 
risk-based regulatory framework is now critical to ensure the 
validation and quality of LDTs.''
    When do you expect the draft guidance to be cleared by OMB and 
issued by FDA?
    Answer 4. We are currently working with FDA on its draft guidance 
on laboratory developed tests (LDTs), and I cannot comment on the 
timing of when it will be issued. That said, we would welcome you or 
your staff to come in and share your views about the draft guidance.

    Question 5. NIH and NCI provide all kinds of grants to researchers 
to provide support for investigator-initiated projects. These grants 
are integral to researcher's ability to pursue academic careers. I have 
heard from several constituents that many young, promising MD/PhD 
investigators are leaving their training programs to go into private 
practice--abandoning their scientific scholarship because there isn't 
funding to support their labs. This is a general problem, but I'm 
particularly concerned about the field of radiation oncology. I 
understand that when the NCI did a review of its grants, it determined 
that about 5 percent of NCI's budget was going to fund radiation 
oncology grants/projects. I'm not sure what the right number would be, 
but 5 percent seems awful small given that radiation oncologists treat 
roughly two-thirds of all cancer patients. Does 5 percent seem small to 
you? And are you willing to review your internal processes to make sure 
that there aren't any problems in the way radiation oncology proposals 
are reviewed that is leading to such a low funding rate?
    Answer 5. The NCI's primary goals are to support and conduct a 
broad spectrum of cancer research. The research NCI oversees uses a 
wide variety of approaches and funding mechanisms, with several goals: 
improving our understanding of the causes and biological mechanisms of 
a large variety of cancers; preventing cancers; detecting and 
diagnosing all types of cancers; and treating cancers, as well as the 
symptoms and sequellae of cancers, more effectively. NCI's research 
projects and programs include studies of the basic aspects of cancer 
biology at the molecular and cellular levels: investigations of how 
cancer cells and processes affect and are affected by the cellular 
environment in which they exist, and applications of these discoveries 
toward successful detection, diagnosis, treatment, prevention, and 
control of cancers of all types.
    In my role as OMB Director, I have not been personally involved in 
account level funding allocation decisions within individual NIH 
Institutes.
    I understand that all research efforts supported by the NCI are 
subjected to rigorous review for quality and purpose by expert peer 
reviewers, program staff, and advisory groups.
    Radiation therapy plays a critical role in NCI's portfolio of 
cancer clinical trials. It is incorporated as a standard part of the 
treatment plans for many cancer patients. Investigational questions 
related to new radiation therapy techniques as well as how to best 
combine radiation therapy with systemic therapies and surgery comprise 
a major part of the portfolio of studies carried out by the NCI's 
National Clinical Trials Network (NCTN). The NCI currently supports 50 
national trials that incorporate radiation therapy as a component of 
the investigational program under examination. In addition to the 
substantive resources provided for radiation therapy-related clinical 
trials, NCI supports basic research into radiation therapy and 
radiobiology. If I am confirmed, I look forward to learning more about 
the concerns raised in your question.

    Question 6. As you know, Section 1341 of the Patient Protection and 
Affordable Care Act establishes a transitional reinsurance program 
intended to stabilize premiums for coverage in the individual market 
from 2014 to 2016. The Act requires $20 billion to be collected from 
health insurance issuers and group health plans, including self-insured 
employers, over the 3-year period. HHS has proposed a national per 
capita fee in 2014 of $63 per covered life, including employees, 
dependents, early retirees, and COBRA eligible individuals. An 
additional $5 billion will be collected by the U.S. Department of 
Treasury.
    I am concerned about impact of this program on employer-sponsored 
coverage, particularly given the recent regulations that would carve 
out some self-administered, self-insured entities. I recently 
introduced a bill to address this problem and it is widely supported by 
the business community as well as by labor. The bill would delay the 
collection of the fee for 3 years, keeping the program itself intact. 
Would you consider an administrative delay of the fee collection?
    Answer 6. The reinsurance program is a critical premium 
stabilization program during the implementation of the new consumer 
protections and market reforms in 2014. If confirmed, I look forward to 
working with Congress on ideas to strengthen and efficiently implement 
this and other important Affordable Care Act programs.
                           senator murkowski

Head Start

    The following questions were suggested by Mark Lackey, president of 
the Alaska Head Start Directors Association. If you are confirmed:

    Question 1. What would your priorities be for the reauthorization 
of the Head Start Act?
    Answer 1. If confirmed, I will review all the changes made in the 
Head Start program since the last reauthorization in 2007. We will 
continue to learn from these experiences. I know that the Department is 
continuing to evaluate the Designation Renewal System (DRS) and its 
effects on quality in particular. If confirmed, I will study all of 
these efforts, including the DRS evaluation, and determine priorities 
for moving forward.

    Question 2. How do you plan to deal with Head Start grantees' 
anxiety and uncertainty surrounding recompetition of Head Start grants, 
which is resulting in high turnover among Head Start directors?
    Answer 2. I understand that adoption of the DRS was a major policy 
shift and that competition has created anxiety for some grantees. 
However, DRS is an opportunity to improve program quality. The overall 
staff turnover rate for Head Start remains significantly lower than the 
national average for the early childhood field more broadly. If 
confirmed, I intend to continue the work of the Department on this 
issue.

    Question 3. What actions would you take to address the fact that 
the professional development requirements for Head Start employees make 
them eligible for higher paying school districts jobs--salaries that 
Head Start grantees cannot match?
    Answer 3. The Department is committed to attracting, training and 
retaining highly qualified staff in order to improve program quality. 
Local grantees set personnel policies such as salaries and make 
decisions to help retain qualified staff. The Head Start Program 
Information Report (PIR) collects data on teacher turnover and reasons 
that teachers report leaving their jobs. According to the latest PIR 
data, in 2013 the turnover rate for Head Start pre-school teaching 
staff was 15 percent and only 24 percent of those teachers (4 percent 
of all teachers) reported leaving for compensation reasons. Most 
teachers report leaving their Head Start positions for ``other 
reasons'' which include retirement, termination, personal/family 
reasons or health issues. If confirmed, I intend to continue the work 
of the Department on this issue and look forward to working with 
external stakeholders to devise effective recruitment and retention 
strategies.

    Question 4. Do you intend to make any changes to the current CLASS 
system of performance standard measurement?
    Answer 4. The Department is undertaking an evaluation of the DRS, 
which includes CLASS. If I am confirmed, I will work with the Assistant 
Secretary of the Administration for Children and Families to examine 
the results of the DRS evaluation and determine any actions going 
forward.

Community Pharmacies

    Question 1. I have heard multiple concerns from Medicare patients 
and local pharmacies about the problems and confusion associated with 
Medicare Part D Preferred Pharmacy Networks. CMS proposed to alleviate 
these problems and confusion in a recent proposed rule, however on 
March 10th CMS released a statement that they would not move forward at 
this time with a solution. What will you do to ensure that patients 
don't have to travel large distances or are forced to use mail order to 
access special savings in Medicare and to ensure that patients can 
continue using the pharmacy of their choice?
    Answer 1. It is my understanding that although CMS has announced 
that it does not plan to finalize certain proposals related to 
preferred cost sharing included in our proposed rule published in the 
Federal Register on January 10, 2014, it continues to focus on 
beneficiary access to and understanding of preferred cost sharing 
arrangements. In order to further analyze this issue, I understand that 
CMS has awarded a contract to study beneficiary access to preferred 
cost sharing. This study will analyze beneficiaries' geographic access 
(i.e., time and distance) to pharmacies offering preferred cost sharing 
in plans' networks. Based on the results of this study and comments 
received on the proposed rule, CMS will evaluate whether and how to set 
standards for network adequacy for pharmacies offering preferred cost 
sharing, similar to current standards for retail network adequacy.
                              senator burr
    Question 1a. The Agency for Toxic Substances and Disease Registry 
(ATSDR), within the Centers for Disease Control and Prevention (CDC), 
in its ongoing statutory role investigating and conducting studies for 
a Public Health Assessment (PHA) of the water contamination that 
occurred at Marine Corps Base Camp Lejeune, NC from 1953-87, has had in 
its possession since March 2013 several thousand documents that relate 
to vapor intrusion in buildings on Camp Lejeune that were located above 
the largest underground contamination plumes in the groundwater. It is 
clear from the dates on some of these documents that the ambient air 
quality in these buildings posed a potential health hazard to the 
occupants of certain buildings and that harmful human exposures may 
have occurred in those buildings for more than a decade and a half 
after the last of the contaminated water wells were shut down in 1985.
    Since ATSDR received these thousands of documents in 2013 from the 
Department of Navy (DoN), what specific actions did the agency take in 
2013 and to date in 2014 to conduct a Vapor Intrusion/Inhalation 
Exposure Pathway (VI/IEP) analysis to further inform ATSDR in its 
ongoing effort to revise and reissue the retracted 1997 PHA for Camp 
Lejeune?
    Answer 1a. I have not been directly engaged on this issue as OMB 
Director. However, I understand from HHS that ATSDR's work to date on 
soil vapor intrusion (SVI) at Camp Lejeune has involved identifying 
voluminous documents that contain information potentially relevant to 
determining whether vapors seeped from the shallow aquifer into 
buildings at Camp Lejeune, potentially exposing those in the buildings 
to dangerous chemicals and posing health risks. Information and data on 
a broad range of topics are potentially relevant to soil vapor 
analysis, including environmental, industrial hygiene, base safety, 
public works, GIS, and health. I further understand that ATSDR staff 
have met with base leadership at Camp Lejeune to identify relevant 
data, and is identifying relevant data sources from ATSDR's Camp 
Lejeune Data Mining Work Group effort. If confirmed, I will work with 
you to appropriately address and respond to the issues confronting Camp 
Lejeune.

    Question 1b. Why did ATSDR delay informing Congress and the Camp 
Lejeune Community Assistance Panel (CAP) of the existence of these 
documents until April 4, 2014?
    Answer 1b. As OMB Director, I have not been made aware of any delay 
in the provision of information regarding this issue. However, I 
understand from HHS that there was some discussion of the documents 
during two Community Assistance Panel (CAP) meetings in 2013--on May 3 
and September 6. ATSDR has since provided an index of the document 
titles of interest identified to date to the CAP has provided a 
briefing to both the CAP and interested congressional staff on ATSDR's 
process for reviewing and identifying documents of interest. If 
confirmed, I will look into this issue and work to keep congressional 
staff and the CAP informed as the process moves forward.

    Question 1c. Has ATSDR cross referenced all the documents it 
obtained from the DoN in 2011 as a result of the ATSDR-DoN Data Mining 
Technical Working Group to determine which of the documents it received 
from DoN in 2013 on Soil Vapor Intrusion and thereafter are not part of 
that ATSDR's Data Mining Technical Working Group's past efforts and is 
ATSDR employing its resident subject matter experts who supported the 
Data Mining Technical Working Group in this effort on Soil Vapor 
Intrusion? If not, please explain why.
    Answer 1c. I was not aware of the specifics of this issue as OMB 
Director, but understand from HHS that ATSDR's review to identify 
documents that are potentially relevant to soil vapor intrusion 
includes the 2011 Camp Lejeune Drinking Water Data Mining Technical 
Work Group as a data source.
    ATSDR's Soil Vapor Intrusion Project Team has worked closely with, 
and benefited significantly from, the subject matter experts from the 
Data Mining Technical Work Group, and the soil vapor team is employing 
the same technologies and procedures developed by the Work Group to 
identify information that is relevant to the current analysis. If 
confirmed, I will look into this issue.

    Question 1d. Are the ATSDR personnel who were members of the Data 
Mining Technical Working Group and who have the subject matter 
expertise and familiarity with the Camp Lejeune document data bases 
been formed into a group at ATSDR to examine these more recent 
documents from the DoN? If not, please explain why.
    Answer 1d. I was not involved in the work associated with these 
data base as OMB Director but if confirmed, I look forward to working 
with you on the next steps on this issue. I understand that ATSDR's 
Soil Vapor Intrusion Project Team has worked closely with, and 
benefited significantly from, the subject matter experts from the Data 
Mining Technical Work Group.

    Question 2. If confirmed, please outline the specific steps you 
will take to improve regulatory transparency, certainty, and 
predictability at the FDA. Please outline in detail the metrics you 
believe would best measure the impact of these steps.
    Answer 2. I understand that FDA's performance goals under all of 
its user fee agreements provide a set of metrics for assessing the 
transparency, certainty, and predictability of its regulatory programs. 
These goals are developed through negotiations between and among the 
Agency, industry, and Congress. FDA realized higher performance levels 
and met more procedural goals than ever before in fiscal year 2012, and 
it continues to strengthen efforts to improve performance in these 
areas while maintaining a focus on ensuring that safe, effective, and 
high-quality new drugs, biologics, generic drugs, medical devices, and 
other product areas under FDA regulatory review are reviewed in an 
efficient and predictable timeframe. I understand that FDA is 
developing performance metrics that align with program requirements to 
help drive outcomes. There is always room to improve. If I am 
confirmed, I will want to better understand these metrics are driving 
performance, and how we can build on that progress.

    Question 3. The policies at the Department of Health and Human 
Services, particularly those at the FDA and CMS, can have a significant 
impact on patients' ability to access innovation. Do you believe that 
the potential impact on innovation should be taken into consideration 
in the Department's policymaking process, including through the 
regulations issued by the Department? If so, how will you ensure that 
the Department enacts policies that advance patients' access to 
innovation?
    Answer 3. I do believe that innovation is a consideration and it is 
something that impacts both quality and cost. During my time at OMB, 
rulemaking review has included economic growth consideration as well as 
health, safety and environmental consideration. If confirmed, I will 
want to work to consider key health impacts and innovation.

    Question 4. Will HHS hold off finalizing the Child Care Development 
Block Grant (CCDBG) regulations until Congress has the opportunity to 
act on the bipartisan legislation I authored with Senator Mikulski to 
reauthorize this program?
    Answer 4. In the event Congress passes and the President signs 
legislation to reauthorize the Child Care and Development Block Grant 
program, the Administration would revisit the rule as part of its work 
to implement the new statute.

    Question 5. Please outline the specific opportunities you see to 
improve program clarity and integrity for HRSA's 340B program. If 
confirmed, how would you seek to work with patient groups, 
pharmaceutical manufacturers, and 340B covered entities with respect to 
these opportunities as well as concerns that may arise in the future?
    Answer 5. HHS recently submitted a rule on the 340B program for OMB 
review. It is OMB's longstanding policy not to comment on rules under 
review. That said, we would welcome you or your staff to come in and 
share your views on the rulemaking with us, and updated information on 
the status of any review can be monitored at: www.reginfo.gov.

    Question 6a. The management of the Strategic National Stockpile 
(SNS) directly impacts our Nation's medical and public health 
preparedness and response capabilities.
    Please explain how HHS identifies the full range of products and 
medical assets necessary to stockpile in the SNS and executes contracts 
and awards to ensure that these needs are met under the full range of 
scenarios, including for products procured by BARDA and CDC.
    Answer 6a. It is my understanding that HHS determines essential 
medical countermeasures (MCM) for chemical, biological, radiological, 
and nuclear (CBRN) threats while considering public health scenarios 
delineated in the Project BioShield Act (2004) and based on Terrorist 
Risk Assessments (TRA) and Material Threat Assessments (MTA) determined 
by the Department of Homeland Security (DHS). As directed by the Public 
Health Emergency Medical Countermeasure Enterprise (PHEMCE), the 
principles, goals, and priorities for the development and acquisition 
of MCMs are defined in the PHEMCE Strategic and Implementation Plan 
(2012). Under Project BioShield, managed by the Biomedical Advanced 
Research and Development Authority (BARDA), MCMs may be developed and 
purchased using the Special Reserve Fund (SRF). This includes MCMs for 
CBRN threats that are not licensed or approved by the FDA, yet have 
sufficient data to warrant utilization under the FDA's Emergency Use 
Authorization (EUA). The results of Project BioShield are provided in 
annual congressional reports (2005-13).
    I further understand that upon licensure or approval of these MCMs, 
the responsibility of stockpiling transitions to the Centers for 
Disease Control and Prevention (CDC)/Strategic National Stockpile 
(SNS). The CDC's SNS inventory assessments are also available to 
Congress in annual reports (2007-13). MCM development and acquisition 
by ASPR/BARDA and CDC/SNS are in full alignment with the PHEMCE SIP 
(2012) and MCM requirements. If confirmed, I look forward to 
understanding how these steps translate to potential action.

    Question 6b. How do these align with the full range of projected 
needs, including those that might not be explicitly identified through 
the 5-year budget plan, such as drug delivery devices that would be 
necessary as part of vaccine administration during a public health 
emergency?
    Answer 6b. My understanding from HHS is that the Strategic National 
Stockpile (SNS) program at CDC maintains stockpiles of vaccine against 
certain threats, as well as ancillary supplies to support 
administration of these products. In addition to ancillary supplies 
procured for specific vaccines, CDC/SNS also maintains ancillary 
supplies (28-million unit requirement and inventory on hand) that could 
be distributed during a public health emergency (e.g., flu vaccines). 
The annual review of the CDC/SNS inventory that is conducted by the 
Public Health Emergency Medical Countermeasures Enterprise and 
submitted to Congress addresses these needs using available annual 
funding to the CDC.
    In the case of a pandemic, HHS pandemic influenza response plans 
designate CDC as the responsible organization for distribution of 
vaccines, as was done during the H1N1 2009 pandemic. During an 
influenza pandemic, BARDA would utilize its existing contracts with 
multiple manufacturers of influenza vaccines and ancillary to purchase 
these products for delivery to the CDC's distribution hubs. CDC, based 
on ordering from States and territories, will instruct the distribution 
hubs to deliver these products to the designated sites.

    Question 6c. For those products that are part of a ``one 
portfolio'' approach that seeks to address both U.S. military and 
civilian medical countermeasure needs, such as treatment for acute 
radiation syndrome in the event of a nuclear incident, how does HHS 
adjust its SNS procurement to ensure that both the military and 
civilian need requirements are accounted for and there will be enough 
product procured to protect both populations?
    Answer 6c. It is my understanding that together, HHS and the 
Department of Defense (DoD) plan and implement programs to develop and 
acquire MCMs that address common threats. Moreover, some shared MCM 
development projects such as Acute Radiation Syndrome therapeutic for 
gastrointestinal injury, have transitioned from the DoD to BARDA for 
advanced development with regard to FDA approval or licensure. As MCMs 
mature toward acceptability by FDA or availability under an Emergency 
Use Authorization, BARDA will purchase these MCMs using the Project 
BioShield Special Reserve Fund to address MCM requirements for the 
civilian population, including special needs populations (e.g., 
children). If the MCM is licensed, then CDC/SNS procures the product. 
If DoD has a requirement to purchase the MCM to address their 
requirements, then DoD and HHS (BARDA or CDC/SNS) enter into an 
agreement to use DoD funds and HHS contracts to acquire the products 
and store the product at the CDC/SNS or forward deploy to the DoD, as 
needed. Conversely, DoD has contracts that HHS utilizes under the 
Economy Act to purchase some FDA approved or licensed products (e.g., 
influenza antiviral drugs) that are stored at the CDC/SNS.
    However, not all DoD MCM requirements are the same as HHS' civilian 
population requirements. In this situation, I understand that HHS and 
DoD pursue development and acquisition together for the therapeutics. 
NIH may support early development of the DoD product, but BARDA does 
not pursue advanced development and acquisition of MCMs that are not 
required for the civilian population.

    Question 6d. For the products under development as part of the 
``one portfolio'' coordinated approach, does HHS consider a requirement 
to be addressed when the SNS has procured enough product for just the 
civilian population need requirement, or both the military and civilian 
population need requirements?
    Answer 6d. Please refer to the previous response.
                             senator hatch

Liver Allocation

    Question 1a. In June 2013, the United Network for Organ Sharing 
(UNOS), which serves as the Nation's Organ Procurement and 
Transplantation Network (OPTN) through a contract with the Department 
of Health and Human Services, implemented a new policy for liver 
allocation. I am concerned that this new policy, ``Share 35,'' may be 
worsening the liver allocation process in the United States. Indeed, in 
my home State of Utah, the new policy is worsening outcomes following 
liver transplantation, causing a higher post-transplant mortality. This 
is in part due to longer times outside the body for donated livers 
because a much higher proportion of donor organs from the local region 
in which they were donated are being moved to transplant centers a 
State or several States away. Often, these out-of-State patients have 
no more medical urgency than do the local patients. I am particularly 
concerned about the impact of the Share 35 policy on liver donation 
rates, including the historically high rates in my home State of Utah. 
Given that a 1 percent increase in donation rates equates to 60 donor 
livers, even small improvements in the rate of organ donation can have 
a large impact on transplant and waitlist mortality rates. Conversely, 
even a 1 percent decline in donation rates would negate any national 
decline in waitlist mortality attributable to Share 35. It seems to me 
that time would be well spent on working to increase the number of 
organ donors in our country. The State-by-State variation is dramatic, 
with a low of less than 5 percent and a high of more than 90 percent.
    Has OPTN conducted an analysis to determine the impact of the new 
policy on liver donation rates in those areas with historically high 
donation rates and historically low donation rates? If not, I urge that 
the Department direct OPTN to conduct such an analysis.
    Answer 1a. There are currently more individuals in need of a 
transplant than for which a donor organ is available. While I have not 
been directly engaged in these issues as OMB Director, my understanding 
from HHS is that in order to continue to raise awareness about the 
importance of registering to be an organ donor, the Department has 
engaged in comprehensive educational campaigns about the importance of 
organ donation, as well as partnered with others in the private sector 
to raise awareness about how to sign up to become an organ donor.
    I understand from HHS that the Organ Procurement and 
Transplantation Network, which is tasked with developing organ 
allocation policies, is currently discussing liver allocation policies 
with experts in the field, transplant recipients, candidates, donor 
family members and living donors. These discussions will continue to be 
governed by clear regulatory requirements, including a strong emphasis 
on transparency and opportunity for public comment. If confirmed, I 
look forward to understanding more about the work and outreach OPTN is 
doing in the liver space.

    Question 1b. Has the Department done any work with its sister 
agencies to ensure steps are taken to increase organ donation rates 
through, for example, requiring that all those who receive a driver's 
license are educated about organ donation and asked whether or not they 
would like to be an organ donor?
    Answer 1b. While I have not been directly engaged in these issues 
as OMB Director, my understanding from HHS is that the Department 
supports a national initiative to increase enrollment in State donor 
registries through public service announcements, social media 
campaigns, and targeted outreach to specific populations. In addition, 
the Department works with States to improve donor registration and 
direct outreach activities occur at local motor vehicles offices. If 
confirmed, I will work to increase organ donation rates.

    Question 1c. Can you please tell me if Share 35 policy was tested 
in a regional demonstration prior to implementation, as required by the 
2010 HHS funding bill? If not, please explain how the new policy was 
evaluated and how any such evaluation provided data equivalent to what 
could have been obtained through a regional demonstration? Please 
provide copies of all evaluation (and other) reports associated with 
the testing of the Share 35 policy (including the exemption for 
patients with liver cancer).
    Answer 1c. While I have not been directly engaged in this issue as 
OMB Director, my understanding from HHS is that the policy was tested 
through the implementation of a ``variance'' policy (``Share 29'') in 
Region 8 through 2011. While the policy variance demonstrated some 
decrease in risk-adjusted waiting list mortality, the results were not 
statistically significant due to the small number of patients included 
in the analysis. However, the OPTN liver committee determined that a 
change targeting a smaller subset of very sick patients with similar 
waiting list mortality would lead to an increase in access to livers 
for patients with the most medical urgency and a decrease in geographic 
disparity for such patients. A report on the potential impact of the 
Share 35 changes to broaden the geographic allocation of livers, 
required by the 2010 Appropriations Conference Report, was submitted to 
the House and Senate Appropriations Committees in November 2011.
    If confirmed, I look forward to learning more about these issues 
and sharing additional information about the Share 35 policy.

    Question 1d. UNOS had made clear that data on this new Share 35 
policy would be reviewed after 6 months of implementation. The 6-month 
deadline passed on January 16, 2014 and I have yet to learn the status 
of this essential post-implementation data review. If this post-
implementation review has not been initiated or has not yet been 
completed, please provide a status report, including a timeline, and an 
in-person briefing by OPTN with HRSA in attendance.
    Answer 1d. I understand that changes to the liver allocation policy 
were implemented beginning in June 2013. A 6-month post-implementation 
analysis indicates that, overall, the goals of this liver allocation 
policy change are being met, and implementation is proceeding as 
expected. For instance, since implementation of the new policy the 
number and percentage of livers shared regionally increased and death 
rates for adult candidates on the liver waiting list have been reduced.
    On March 31, HHS/HRSA staff briefed Senate Appropriations staff on 
these results. If confirmed, I would be pleased to ensure further 
briefings occur as needed.

    Question 1e. I would also like to better understand HRSA's 
oversight of liver allocation. Does the Department have to approve of 
or in any way review a new national liver organ allocation policy?
    Answer 1e. If confirmed, I look forward to learning more about 
HRSA's oversight of liver allocation policies. My understanding from 
HHS is that HRSA contracts with the United Network for Organ Sharing 
(UNOS) for the operation of the National Organ Procurement and 
Transplantation Network. HRSA is responsible for overseeing the 
operation of the OPTN to ensure equitable allocation of donor organs 
for transplantation, including the equitable allocation of livers. OPTN 
organ allocation policies are developed through a deliberative process 
with input from a wide range of stakeholders and must be consistent 
with the principles established in the National Organ Transplant Act of 
1984, as amended, and the regulations governing the operation of the 
OPTN.
    If confirmed, I look forward to further understanding your concerns 
and sharing additional information about national liver organ 
allocation policy.

    Question 1f. Does the Department have the authority to address the 
ongoing and widely recognized problem of ``over-prioritization'' of 
liver cancer patients for liver transplant? Liver cancer patients are 
automatically assigned a high score, which increases automatically 
(equating to a higher place on the transplant list) simply because they 
have liver cancer, even though they have no higher potential benefit 
from transplant than do patients with the same MELD score calculated 
based on lab values. A substantial and growing portion of livers that 
are transplanted under Share 35 are given to patients with these 
``exception'' scores. I urge that the Department take action to address 
this inequity, and that the Department insist that UNOS review their 
exception process and ensure that waitlist positions are based on 
objective lab scores, and that liver cancer or other types of patients 
are not ``over prioritized'' in contraindication of science.
    Answer 1f. As OMB Director, I have not been involved in the current 
determination. My understanding from HHS is that candidates with a 
MELD/PELD score exception for hepatocellular carcinoma receive high 
priority on the liver wait list. As with all allocation policies, HRSA 
and the OPTN analyze and monitor any emerging issues and there is 
currently a policy proposal in public comment that would restrict 
automatic extensions for patients with HCC exceptions. If confirmed, I 
look forward to working with you and OPTN on this important issue.

Meaningful Use Electronic Health Record Incentive Program

    Question 1. Although very few providers have achieved Meaningful 
Use Stage 2, CMS and the Office of the National Coordinator for Health 
Information Technology (ONC) are already engaged in preliminary steps 
toward Stage 3 rulemaking. Frankly, it is difficult for me to 
understand how Stage 3 decisionmaking can be underway when there has 
seemingly been absolutely no opportunity to learn from the experience 
of Stage 2. Can you please share the evidence base about Stage 2 that 
the Department is using to inform Stage 3 rulemaking?
    Answer 1. It is my understanding that HHS is drawing on a range of 
quantitative and qualitative data to inform Stage 3 rulemaking. As has 
been the case in 2011, 2012, and 2013, it is expected that most 
providers who attest in 2014 will Attestation data from providers who 
attest to Stage 2 will be used as it is available to inform Stage 3 
rulemaking. In addition to administrative data from the Medicare and 
Medicaid EHR Incentive Programs, HHS is using data from national 
surveys of physicians and hospitals on the rate of adoption of specific 
health IT functionalities and the impacts of EHR use on health care 
outcomes. HHS is also taking into account qualitative data gathered 
from key stakeholders including information from hearings and listening 
sessions held by the Health IT Policy Committee on provider and vendor 
experience preparing for and meeting Stage 2.
    An overview of the data being used to inform Stage 3 rulemaking can 
be found in presentations to the Health IT Policy Committee, including:

     http://www.healthit.gov/facas/sites/faca/files/
HITPC_Data--Analytics_Up-
date_2014-04-08.pdf.
     http://www.healthit.gov/facas/sites/faca/files/
HITPC_DataAnalyticsUpdate
_2014-05-06.pdf.
     http://www.healthit.gov/facas/sites/faca/files/
HITPC_ListeningSessionsUp-
date_2014-04-08.pdf.

    Question 2. Interoperability of Electronic Health Records (EHRs) 
and the care coordination enabled by the successful use of Health 
Information Technology (HIT) are critical to the Nation's ability to 
move to an efficient, high-value health system. The Medicare and 
Medicaid Electronic Health Record incentive program, known as the 
``Meaningful Use'' program, seeks to facilitate the widespread 
utilization of EHRs by hospitals and physicians. This program is meant 
to eliminate--not perpetuate--the digital divide.
    Over the next 5 months (May through September), more than 5,000 
hospitals and 550,000 physicians and other eligible professionals must 
adopt the 2014 Edition of Certified EHR Technology (CEHRT) and meet a 
higher threshold of Meaningful Use criteria. Failure to do so will not 
only result in a loss of incentive payments, but also the imposition of 
significant penalties. I understand from providers that the 2014 
Certification and Stage 2 Meaningful Use requirements (which include 
both an upgrade to the 2014 Edition Certified EHR and an increase in 
the performance requirements) are simply too much change all at once.
    The American Hospital Association (AHA) recently determined that if 
current timelines remain, approximately 40 percent of hospitals are at 
risk of failing to meet Meaningful Use in fiscal year 2014. Only a 
fraction of the technology used to achieve Meaningful Use has been 
certified as required for 2014. The AHA and the American Medical 
Association joined with more than 40 national hospital and physician 
groups in a February 21, 2014 joint letter to you, Secretary Sebelius, 
urging that additional time and flexibility be afforded to providers 
with respect to Stage 2 Meaningful Use requirements and 2014 
Certification requirements. Similar recommendations were made to your 
predecessor beginning last summer by the College of Healthcare 
Information Management Executives (CHIME), the Healthcare Information 
and Management Systems Society (HIMSS), the National Rural Health 
Association (NRHA), the American College of Physicians (ACP), the 
Medical Group Management Association (MGMA) and the American Academy of 
Family Physicians (AAFP). It is abundantly clear that there is 
significant and widespread continuing concern about the timing of 
Meaningful Use Stage 2.
    CMS responded to these concerns with broadened hardship exceptions 
from the program's penalties on March 10, which potentially excuse 
providers from penalties due to difficulties with their vended HIT 
product. This action did nothing to provide additional time so that 
providers could reach Stage 2 safely and effectively and still earn 
incentive dollars. I believe that additional time and flexibility for 
those who need it to safely attest to Stage 2 of Meaningful Use is 
needed.
    Can you please provide specific reasons along with the evidence 
base that resulted in your rejection of the views of these stakeholders 
and the quantifiable information they shared with the Department? I 
would particularly be interested in seeing the data on which you based 
your decision, including information about the dates on which 2014 
Edition CEHRT arrived at hospitals and eligible professionals, whether 
the certified components worked as intended, what percentage of the 
CEHRT needed upgrades or other fixes, how many modules were missing 
from delivered product as well as your sense of how long a safe 
implementation of CEHRT should take.
    Should this data support the provision of additional time and 
flexibility for providers to reach Stage 2, I urge that you provide it. 
Indeed, additional time for Meaningful Use Stage 2 would not only be 
positively received but it would also allow the Meaningful Use program 
to succeed and would demonstrate the Administration's willingness to 
listen to the market and understand the importance and time intensity 
of testing software, addressing inadequacies, adjusting workflows, and 
training clinicians.
    Answer 2. HHS believes it has made an effort to listen to 
providers, health care associations, EHR vendors, and its partners in 
the health care industry. In December 2013, HHS announced that it would 
engage in rulemaking to extend Stage 2 of meaningful use for 1 year and 
allows Stage 3 to begin in 2017. In addition, ONC issued a 2015 Edition 
EHR Certification Criteria Proposed Rule as part of its new regulatory 
approach to provide more frequent updates to the certification 
criteria.
    By extending Stage 2 until 2017, CMS and HHS would have an 
additional year of Stage 2 implementation data to help inform any 
program changes. An extension also allows CMS and ONC to better align 
quality performance measures and to implement a Stage 3 that through 
interoperability and clinical decision support capabilities would help 
lead to improved health outcomes.
    CMS and ONC announced in February 2013 that additional flexibility 
would be provided for payment adjustments and hardship exceptions so 
that providers can avoid penalties for reasons beyond their control. 
For example, eligible professionals and hospitals may request a 
hardship exception because they are unable to control the availability 
of Certified EHR Technology (CEHRT) at a practice location or a 
combination of practice locations.

340(B) Program

    Question 1. In her testimony before the Finance Committee, 
Secretary Sebelius stated that the 340B program had ``expanded beyond 
its bounds.'' In its upcoming mega-rule, will HRSA be offering further 
guidance on the eligibility criteria that hospitals must meet--
including, guidance on what it means to be ``formally delegated 
governmental powers by a unit of State or local government'' as well as 
guidance on what constitutes an ``under contract with a State or local 
government to provide health care services to low-income individuals 
who are not eligible for Medicaid or Medicare''?
    Answer 1. HHS recently submitted a rule on the 340B program for OMB 
review. It is OMB's longstanding policy not to comment on rules under 
review. That said, we would welcome you or your staff to come in and 
share your views on the rulemaking with us, and updated information on 
the status of any review can be monitored at: www.reginfo.gov.

    Question 2. Another area of growth in the 340B program appears to 
be the number of ``child sites'' that are eligible for the program as a 
result of being listed on a hospital's Medicare cost report. Over the 
past decade or more, there has been considerable consolidation in the 
health care market. As a result, many hospitals have acquired clinics 
that had previously been community-based clinics, such as community 
oncology centers. With those acquisitions, hospitals eligible for the 
340B program have been able to access 340B discounts for those acquired 
child sites. Other than being required to be listed on a hospital's 
Medicare cost report, are ``child sites'' required to provide a certain 
level of care to low-income vulnerable patient populations? In other 
words, is the expectation that if a hospital lists a child site, such 
as oncology clinic, on its cost report, that the site is expected to 
provide treatment to uninsured or low-income patients the same way that 
the hospital is required to treat an uninsured patient that walks into 
its outpatient facility of the 340B hospital?
    Answer 2. HHS recently submitted a rule on the 340B program for OMB 
review. It is OMB's longstanding policy not to comment on rules under 
review. That said, we would welcome you or your staff to come in and 
share your views on the rulemaking with us, and updated information on 
the status of any review can be monitored at: www.reginfo.gov.

    Question 3. Another driver of growth in the 340B program is the 
contract pharmacy program that has seen significant growth over the 
past 3\1/2\ years. In 2010, HRSA fundamentally changed the 340B program 
through guidance that allowed 340B covered entities to contract with an 
unlimited number of contract pharmacies. Since that time, there has 
been over 750 percent growth in the number of contract pharmacies. As 
of November 2013, covered entities collectively maintained over 30,000 
pharmacy arrangements. While HRSA has recently stated that the vast 
majority of 340B covered entities do not utilize contract pharmacies, 
it is clear that the growth that has occurred far exceeds the estimates 
HRSA previously had with regards to the number of contract pharmacy 
arrangements that they predicted would develop.
    While the original goal HRSA articulated in its 2010 guidance 
permitting such an expansion was laudable, it is unclear whether the 
current policy is helping vulnerable patients access discounted 
medicines. The unstated premise of the 2010 policy was that contract 
pharmacies would pass through 340B prices to covered entity patients. 
However, a recent report by the U.S. Department of Health and Human 
Services Office of Inspector General found that with regards to the DSH 
hospitals it interviewed, only \1/3\ of those hospitals provided the 
discount to uninsured patients in at least one of their contract 
pharmacy arrangements. If discounts are not passed onto needy patients 
through contract pharmacy arrangements, what is the direct patient 
benefit of permitting unlimited contract pharmacies?
    Answer 3. HHS recently submitted a rule on the 340B program for OMB 
review. It is OMB's longstanding policy not to comment on rules under 
review. That said, we would welcome you or your staff to come in and 
share your views on the rulemaking with us, and updated information on 
the status of any review can be monitored at: www.reginfo.gov.

    [Whereupon, at 11:37 a.m., the hearing was adjourned.]

                                   [all]
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