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PPACA IMPLEMENTATION FAILURES: WHAT’S 

NEXT? 

HEARING 

BEFORE THE

SUBCOMMITTEE ON HEALTH 

OF THE

COMMITTEE ON ENERGY AND 

COMMERCE 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED THIRTEENTH CONGRESS 

FIRST SESSION 

DECEMBER 11, 2013 

Serial No. 113–108 

( 

Printed for the use of the Committee on Energy and Commerce 

energycommerce.house.gov 

COMMITTEE ON ENERGY AND COMMERCE 

FRED UPTON, Michigan 

Chairman 

RALPH M. HALL, Texas 

JOE BARTON, Texas 

Chairman Emeritus 

ED WHITFIELD, Kentucky 

JOHN SHIMKUS, Illinois 

JOSEPH R. PITTS, Pennsylvania 

GREG WALDEN, Oregon 

LEE TERRY, Nebraska 

MIKE ROGERS, Michigan 

TIM MURPHY, Pennsylvania 

MICHAEL C. BURGESS, Texas 

MARSHA BLACKBURN, Tennessee 

Vice Chairman 

PHIL GINGREY, Georgia 

STEVE SCALISE, Louisiana 

ROBERT E. LATTA, Ohio 

CATHY MCMORRIS RODGERS, Washington 

GREGG HARPER, Mississippi 

LEONARD LANCE, New Jersey 

BILL CASSIDY, Louisiana 

BRETT GUTHRIE, Kentucky 

PETE OLSON, Texas 

DAVID B. MCKINLEY, West Virginia 

CORY GARDNER, Colorado 

MIKE POMPEO, Kansas 

ADAM KINZINGER, Illinois 

H. MORGAN GRIFFITH, Virginia 

GUS M. BILIRAKIS, Florida 

BILL JOHNSON, Ohio 

BILLY LONG, Missouri 

RENEE L. ELLMERS, North Carolina 

HENRY A. WAXMAN, California 

Ranking Member 

JOHN D. DINGELL, Michigan 

FRANK PALLONE, JR., New Jersey 

BOBBY L. RUSH, Illinois 

ANNA G. ESHOO, California 

ELIOT L. ENGEL, New York 

GENE GREEN, Texas 

DIANA DEGETTE, Colorado 

LOIS CAPPS, California 

MICHAEL F. DOYLE, Pennsylvania 

JANICE D. SCHAKOWSKY, Illinois 

JIM MATHESON, Utah 

G.K. BUTTERFIELD, North Carolina 

JOHN BARROW, Georgia 

DORIS O. MATSUI, California 

DONNA M. CHRISTENSEN, Virgin Islands 

KATHY CASTOR, Florida 

JOHN P. SARBANES, Maryland 

JERRY MCNERNEY, California 

BRUCE L. BRALEY, Iowa 

PETER WELCH, Vermont 

BEN RAY LUJAN, New Mexico 

PAUL TONKO, New York 

JOHN A. YARMUTH, Kentucky 

SUBCOMMITTEE ON HEALTH

JOSEPH R. PITTS, Pennsylvania 

Chairman 

MICHAEL C. BURGESS, Texas 

Vice Chairman 

ED WHITFIELD, Kentucky 

JOHN SHIMKUS, Illinois 

MIKE ROGERS, Michigan 

TIM MURPHY, Pennsylvania 

MARSHA BLACKBURN, Tennessee 

PHIL GINGREY, Georgia 

CATHY MCMORRIS RODGERS, Washington 

LEONARD LANCE, New Jersey 

BILL CASSIDY, Louisiana 

BRETT GUTHRIE, Kentucky 

H. MORGAN GRIFFITH, Virginia 

GUS M. BILIRAKIS, Florida 

RENEE L. ELLMERS, North Carolina 

JOE BARTON, Texas 

FRED UPTON, Michigan (ex officio) 

FRANK PALLONE, JR., New Jersey 

Ranking Member 

JOHN D. DINGELL, Michigan 

ELIOT L. ENGEL, New York 

LOIS CAPPS, California 

JANICE D. SCHAKOWSKY, Illinois 

JIM MATHESON, Utah 

GENE GREEN, Texas 

G.K. BUTTERFIELD, North Carolina 

JOHN BARROW, Georgia 

DONNA M. CHRISTENSEN, Virgin Islands 

KATHY CASTOR, Florida 

JOHN P. SARBANES, Maryland 

HENRY A. WAXMAN, California (ex officio) 

(II) 

(III) 

C O N T E N T S 

Page 

Hon. Joseph R. Pitts, a Representative in Congress from the Commonwealth 

of Pennsylvania, opening statement ................................................................... 2 

Prepared statement .......................................................................................... 2 

Hon. Fred Upton, a Representative in Congress from the State of Michigan, 

opening statement ................................................................................................ 3 

Prepared statement .......................................................................................... 3 

Hon. Tim Murphy, a Representative in Congress from the Commonwealth 

of Pennsylvania, opening statement ................................................................... 3 

Hon. Frank Pallone, Jr., a Representative in Congress from the State of 

New Jersey, opening statement .......................................................................... 4 

Hon. Henry A. Waxman, a Representative in Congress from the State of 

California, opening statement ............................................................................. 7 

WITNESSES

Kathleen Sebelius, Secretary, Department of Health & Human Services .......... 8 

Prepared statement .......................................................................................... 11 

Answers to submitted questions ...................................................................... 67 

SUBMITTED MATERIAL

Letter of November 18, 2013, from Anthony Weil to Courier News, submitted 

by Mr. Pallone ...................................................................................................... 6 

Two redacted letters, submitted by Ms. Schakowsky ........................................... 40 

Letter of December 1, 2013, from Julie Welch to President Obama, submitted 

by Mr. Pitts ........................................................................................................... 60 

Letter of October 29, 2013, from Gary Lauer, Chairman and CEO, eHealth, 

to President Obama, submitted by Mr. Burgess ............................................... 65 

(1) 

PPACA IMPLEMENTATION FAILURES: WHAT’S 

NEXT? 

WEDNESDAY, DECEMBER 11, 2013 

HOUSE OF REPRESENTATIVES, 

SUBCOMMITTEE ON HEALTH, 

COMMITTEE ON ENERGY AND COMMERCE, 

Washington, DC. 

The subcommittee met, pursuant to call, at 10:00 a.m., in room 

2123, Rayburn House Office Building, Hon. Joseph R. Pitts (chairman of the subcommittee) presiding. 

Members present: Representatives Pitts, Burgess, Whitfield, 

Shimkus, Rogers, Murphy, Blackburn, Gingrey, Lance, Cassidy, 

Guthrie, Griffith, Bilirakis, Ellmers, Barton, Upton (ex officio), 

Pallone, Dingell, Engel, Schakowsky, Matheson, Green, Barrow, 

Castor, Sarbanes, and Waxman (ex officio). 

Also present: Representative DeGette. 

Staff present: Clay Alspach, Counsel, Health; Carl Anderson, 

Counsel, Oversight; Gary Andres, Staff Director; Ray Baum, Senior 

Policy Advisor/Director of Coalitions; Sean Bonyun, Communications Director; Matt Bravo, Professional Staff Member; Karen 

Christian, Chief Counsel, Oversight; Noelle Clemente, Press Secretary; Paul Edattel, Professional Staff Member, Health; Brad 

Grantz, Policy Coordinator, Oversight and Investigations; Sydne 

Harwick, Legislative Clerk; Brittany Havens, Legislative Clerk; 

Sean Hayes, Counsel, Oversight and Investigations; Robert Horne, 

Professional Staff Member, Health; Alexa Marrero, Deputy Staff 

Director; Katie Novaria, Legislative Clerk; Monica Popp, Professional Staff Member, Health; Chris Sarley, Policy Coordinator, Environment and the Economy; Heidi Stirrup, Policy Coordinator, 

Health; Tom Wilbur, Digital Media Advisor; Ziky Ababiya, Democratic Staff Assistant; Phil Barnett, Democratic Staff Director; 

Stacia Cardille, Democratic Deputy Chief Counsel; Brian Cohen, 

Democratic Staff Director, Oversight and Investigations, Senior 

Policy Advisor; Hannah Green, Democratic Staff Assistant; Elizabeth Letter, Democratic Assistant Press Secretary; Karen Nelson, 

Democratic Deputy Staff Director, Health; Stephen Salsbury, 

Democratic Special Assistant; and Matt Siegler, Democratic Counsel. 

Mr. PITTS. The subcommittee will come to order. 

The Chair will recognize himself for an opening statement. 

2 

OPENING STATEMENT OF HON. JOSEPH R. PITTS, A REPRESENTATIVE IN CONGRESS FROM THE COMMONWEALTH 

OF PENNSYLVANIA 

Throughout this year, various administration officials, including 

you, Madam Secretary, have sat in this room and repeatedly told 

the American people that implementation of the Affordable Care 

Act was on schedule. 

As we have seen from the disastrous rollout of HealthCare.gov 

and documents showing that the October 1 deadline could not be 

met, that was false. 

In fact, every major promise the administration made about the 

ACA, from being able to keep your health plan if you like it, to 

being able to keep your doctor if you want to, the very premise of 

health reform in the first place, that the Affordable Care Act would 

make health coverage more affordable, has proven to be wrong. 

My constituents have repeatedly expressed to me that they feel 

they were lied to by the administration about the real effects of 

this law. 

In addition, we are also learning that millions may be improperly 

enrolled in Medicaid as a result of the disastrous rollout—resulting 

in Washington, yet again squandering the hard-earned dollars sent 

to the Federal Government by our constituents. 

Words start to lose their meaning when they are delivered by individuals who have either misled this committee or were woefully 

ignorant of the disastrous consequences that have unfolded since 

enactment of the ACA. 

The last time you were here, Madam Secretary, you said ‘‘I know 

that it isn’t fair to ask the American people to take our word for 

it.’’ 

While millions of Americans are being harmed by this law, my 

constituents do not trust the administration when it comes to the 

Affordable Care Act, and it is they who are suffering because of 

these broken promises. 

[The prepared statement of Mr. Pitts follows:] 

PREPARED STATEMENT OF HON. JOSEPH R. PITTS

Throughout this year, various administration officials, including you, Secretary 

Sebelius, have sat in this room and repeatedly told the American people that implementation of the Affordable Care Act was on schedule. 

As we have seen from the disastrous rollout of healthcare.gov, and documents 

showing that the October 1 deadline could not be met, that was false. 

In fact, every major promise the administration made about the ACA—from being 

able to keep your health plan if you like it, to being able to keep your doctor if you 

want to, to the very premise of health reform in the first place, that the ACA would 

make health coverage more affordable—has proven to be wrong. 

My constituents have repeatedly expressed to me that they feel they were lied to 

by the administration about the real effects of this law. 

In addition, we are also learning that millions may be improperly enrolled in Medicaid as a result of the disastrous rollout—resulting in Washington yet again squandering the hard earned dollars sent to the Federal Government by our constituents. 

Words start to lose their meaning when they are delivered by individuals who 

have either misled this committee or were woefully ignorant of the disastrous consequences that have unfolded since enactment of the ACA. 

The last time you were here, Madam Secretary, you said, ‘‘I know that it isn’t fair 

to ask the American people to take our word for it.’’ 

My constituents do not trust the administration when it comes to the ACA, and 

it is they who are suffering because of these broken promises. 

3 

Mr. PITTS. And I will yield to the chairman of the full committee, 

Mr. Upton. 

OPENING STATEMENT OF HON. FRED UPTON, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF MICHIGAN 

Mr. UPTON. Thank you, Mr. Chairman. This committee has conducted extensive oversight of the President’s health care law. Many 

of the administration’s top health officials have testified over the 

last year, including the Secretary. They repeatedly looked us in the 

eye in the spring, summer, and fall, and assured us that in fact everything was on track. But our oversight has produced documents 

showing the frantic chaos of missed deadlines and delays behind 

the scenes. 

Sadly, it seems that the administration’s assurances about being 

ready to launch were just as empty as the President’s promises 

that this law would mean lower costs while allowing Americans to 

keep the coverage and doctors that they have and like. And millions of Americans are now enduring the harsh reality of canceled 

plans, the burden of finding a new doctor and the financial strain 

of higher premiums set to shock family budgets. 

Far too many Americans who are happy and satisfied with their 

health care coverage on January 1st of this year have had their 

worlds turned upside down as we approach January 1st of 2014. 

This is a matter of trust. It is time for the administration to be 

honest with folks like Mary Swanson in Kalamazoo, Michigan, my 

constituent, who, along with her husband, has lost a self-described 

excellent plan. No more false promises, no more political games, no 

more questionable testimony, it is time for transparency and the 

truth, and I yield the balance of my time to Dr. Murphy. 

[The prepared statement of Mr. Upton follows:] 

PREPARED STATEMENT OF HON. FRED UPTON

This committee has conducted extensive oversight of the president’s health care 

law. Many of the administration’s top health officials have testified over the last 

year, including the secretary. They repeatedly looked us in the eye—in the spring, 

summer, and fall—and assured us everything was ‘‘on track.’’ But our oversight has 

produced documents showing the frantic chaos of missed deadlines and delays behind the scenes. 

Sadly, it seems the administration’s assurances about being ready to launch were 

just as empty as the president’s promises that this law would mean lower costs 

while allowing Americans to keep the coverage and doctors they have and like. Millions of Americans are now enduring the harsh reality of canceled plans, the burden 

of finding a new doctor, and the financial strain of higher premiums set to shock 

family budgets. Far too many Americans who were happy and satisfied with their 

health coverage on January 1, 2013, have had their worlds turned upside down as 

we approach January 1, 2014. 

This is a matter of trust. It is time for the administration to be honest with folks 

like Mary Swanson in Kalamazoo, Michigan, who along with her husband has lost 

a self-described ‘‘excellent’’ plan. No more false promises. No more political games. 

No more questionable testimony. It is time for transparency and the truth. 

OPENING STATEMENT OF HON. TIM MUPRHY, A REPRESENTATIVE IN CONGRESS FROM THE COMMONWEALTH OF PENNSYLVANIA 

Mr. MURPHY. Thank you, Chairman Upton. And thank you for 

being here today, Secretary Sebelius. 

4 

As the chairman of the Subcommittee on Oversight and Investigations, I worked with my fellow members to conduct oversight 

of the President’s health care law. We have had several people before our committee who have talked about its implementation. 

Some of the concerns and questions you raised in the first part of 

this year, increased premiums, the burden of this law on small 

businesses, whether the implementation was on track and the costs 

have come to fruition. 

Documents uncovered by the O&I Subcommittee show that the 

administration knew months before the October 1 start-up of open 

enrollment about problems with the Federally facilitated marketplace. And yet every administration official came before us testified 

before the committee this year that implementation was on track. 

Now we are just 2 weeks away from the January 1 start of coverage, and what should the American public expect? Unfortunately, 

the record of transparency has not improved. The administration 

has continued its pattern of announcing delays to the law over the 

holiday weekend, most recently the 1-year delay of the online enrollment to the SHOP program. And it failed to acknowledge problems when the writing is on the wall. In the meantime, millions 

have received a pink slip from their insurance plan, and others are 

facing unaffordable care with new higher rates. 

Last month, a top CMS official told the committee that 30 to 40 

percent of the Web site was yet to be built. I hope you will be able 

to provide, get some answers for us today. I hope you also commit 

today to help speed up the response to the committee’s document 

request. Two boxes of documents in 2 months is not a good response. Thank you. 

Mr. PITTS. The Chair thanks the gentleman. The Chair now recognizes the ranking member of the subcommittee, Mr. Pallone, 5 

minutes. 

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

Mr. PALLONE. Thank you, Chairman Pitts. Let me just say that 

I’m sorry that you couldn’t find a way to accommodate members to 

attend the Nelson Mandela memorial and not miss today’s important hearing. Many of the Democrats are at that memorial service 

today, and I know that Mr. Waxman made a reasonable request 

that was denied, and I wish that it hadn’t been the case. But in 

any case, we are moving forward. I listened to what my Republican 

colleagues just said about the Affordable Care Act, and Madam 

Secretary, and I don’t know where the reality is on their part. 

Sometimes I think that they are living on Mars rather than Earth. 

I heard consequences, things like disastrous consequences, harm, 

suffering, harsh reality, world turned upside down. 

I mean, they should have been at my forum. I had a forum Monday night in Highland Park which is one of my towns, on the ACA, 

and I heard just the opposite. People were happy because they 

were able to enroll. Some were Medicaid recipients who weren’t eligible for Medicaid before. Many of them, you know, were remarking 

about, you know, the ability to get insurance for the first time. 

5 

So you know it just boggles my mind to hear these Republican 

comments about a world turned upside down when the reality is 

that the Affordable Care Act is working. People are getting insurance who didn’t have it, people are getting affordable insurance 

with good benefits. I mean, that is the reality that I hear when I 

am home, and I am not making it up. I mean, I will take any of 

them to my forum if they want to. 

Regardless, let me welcome you, Madam Secretary, for joining us 

again. I understand you have been in front of our committee more 

than any other and we are grateful for your service and your valuable time. I am eager to hear what I know is positive news about 

the enrollment of coverage under the ACA and the law’s implementation. Republicans seem to be saying things haven’t improved. 

They have improved a lot, and certainly the Web site has improved 

a lot. It is really unfortunate that the Republicans continue to focus 

their time and effort trying to obstruct and sabotage the ACA rather than working on a constructive way to make sure that as many 

Americans as possible are able to benefit from it. 

I am proud of this law. And I wanted to mention a story, one of 

my constituents from Piscataway, New Jersey, wrote a letter to the 

editor of a local newspaper describing his experience with health 

insurance pre and post implementation of the health exchange, and 

I ask that the letter be submitted for the record, Mr. Chairman. 

Mr. PITTS. Without objection, so ordered. 

[The information follows:] 

6 

7 

Mr. PALLONE. I won’t read it, but this gentleman found a plan 

on the exchange that cost less than the price of his previous plan. 

It has better coverage, better deductible, better out-of-pocket maximum, better copays, better prescription drugs. His experience 

demonstrates that this is a quality product that people want to 

sign up for. I will leave it at that because I am yielding now to Mr. 

Waxman. 

OPENING STATEMENT OF HON. HENRY A. WAXMAN, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF CALIFORNIA 

Mr. WAXMAN. Thank you very much for yielding to me. I want 

to echo your statement about the regrets that we have that the majority wouldn’t postpone this hearing so that all members could attend the memorial for Nelson Mandela. 

Obviously, more Democrats feel that the reason they wanted to 

be there was more important than to be here. They shouldn’t have 

had to make that choice. Madam Secretary, I want to welcome you 

back to our committee. 

HealthCare.gov is much improved since you last appeared before 

the committee. Millions more have applied for coverage and signed 

up. In fact, we just learned today that enrollment in November 

quadrupled over the October enrollment. 

All told, as of November 30, 365,000 people have enrolled in private coverage, 1.9 million were through the process just waiting to 

pick a plan, andenrollment has been speeding up each and every 

week. As a result, we are beginning to hear the stories of people 

finally getting the security and peace of mind that comes with 

quality health insurance. And some of these stories are very powerful. Barbara from my district recently found out that her policy was 

going to be canceled, and she had been rejected in the past for 

more affordable policies because of her back problem. In a new policy she obtained on the exchange, her deductibles were cut in half, 

she will save hundreds more on free preventive care, and her premiums will never shoot up if she has a serious health event. 

These success stories are happening in every State and district 

in the country, though you wouldn’t know it from the Republican 

members’ comments. Joanne from Florida had been uninsured and 

hadn’t seen a doctor in years. She has repeatedly tried to enroll 

without success, and then this week, she purchased a plan for only 

a few dollars a month. When that finely occurred, she burst into 

tears. Our exchange director in California has said that this is a 

common experience. 

I know this law is controversial, Mr. Chairman, that is because 

of hundreds of millions of dollars, opponents have spent trying to 

demonize the law. I think Republicans are afraid that this law is 

going to be popular when it is fully in effect. The public is tired 

of the partisanship from a divided Congress. Mr. Chairman, I want 

to make one request, and this will be the last statement I want to 

make now. I hope that the Secretary gets more respectful treatment from all the members than she received in the last hearing. 

At a minimum, she should be allowed to answer questions. The last 

time she was interrupted over and over again. 

8 

There are more Republicans here today than Democrats. We are 

all going to get our chance to ask questions, a lot of Democrats 

won’t because they chose to be at the memorial service, but whoever asks the question, the Secretary should be able to answer her 

questions and not be rudely interrupted and not have the cheap 

shots she had to endure the last time. 

Mr. PITTS. The Chair thanks the gentleman. The gentleman’s 

time is expired. 

Without objection, all members’ opening statements will be made 

a part of the record. 

On our panel today, we have the Honorable Kathleen Sebelius, 

the Secretary of the Department of Health & Human Services. 

Thank you again, Madam Secretary, for coming. I urge all members to use proper decorum and permit her to respond to the questions. But we only have so many minutes. I understand members 

will be trying to get as many questions in as they possibly can, and 

we will try to operate the gavel strictly and fairly. 

Madam Secretary, thank you for coming. You will have 5 minutes to summarize your testimony. Your written testimony will be 

placed in the record. At this time the Chair recognizes the Honorable Secretary Sebelius, 5 minutes. 

STATEMENT OF KATHLEEN SEBELIUS, SECRETARY, 

DEPARTMENT OF HEALTH & HUMAN SERVICES 

Ms. SEBELIUS. Well, thank you, Chairman Upton and Ranking 

Member Waxman, Mr. Pitts, Mr. Pallone, members of the committee, since I was last here on October 30th, our team has been 

working around the clock to improve HealthCare.gov. We committed to making the site work smoothly for the vast majority of 

users by the end of November, and after several hundred software 

fixes and hardware upgrades, we have achieved this first benchmark. 

While there is still more work to do, we have made great 

progress. HealthCare.gov is working faster, responding more quickly and we are able to handle larger volumes of concurrent users. 

Pages that once took 8 seconds to load are now responding in under 

a second. The site’s error rate which once topped 6 percent has 

been driven down to below 1 percent. The system has more redundancy and stability, and we can now handle 50,000 simultaneous 

users and more than 800,000 daily visitors. 

Now as more Americans give HealthCare.gov a second look, they 

are finding the experience is night and day compared to where we 

were back in October. And they are responding by shopping for 

plans and enrolling in greater numbers. As Mr. Waxman has said, 

more than four times as many enrolled in the Federal marketplace 

in November as enrolled in October. 

In the first 2 months, nearly 1.2 million Americans either selected a marketplace plan or received a Medicaid or CHIP eligibility determination with nearly 365,000 people selecting a plan 

and 803,000 receiving a determination. 

An additional 1.9 million people have made it through the application and determination, but have not yet selected a plan, and we 

expect that as more folks talk things over with their families and 

learn about their new options, more will enroll. To those who have 

9 

been frustrated with the experience so far, we are asking you to 

come back. 

It is now easier than ever to shop for plans and enroll on line, 

over the phone, on paper, in person or directly through an issuer 

or agent. More than 5 million Americans have dialed into our call 

center in the first 2 months, 450,000 have received assistance from 

more than 19,000 trained assisters. And in the first week of December alone, HealthCare.gov received nearly 5 million visits. 

Open enrollment for health insurance continues for 3–1/2 more 

months, so there is still time. To put this in perspective, most private insurance plans offer open enrollment for only a few weeks. 

Now we continue to be relentless in our efforts to improve 

HealthCare.gov, and we are committed to learning, adapting, improving and acting on the feedback we received from consumers 

and issuers alike. As I told this committee at the end of October, 

the initial launch of HealthCare.gov was flawed, frustrating and 

unacceptable. And I believe strongly in accountability and our obligations as public servants to be good stewards of taxpayer dollars. 

Now that the Web site is working more smoothly, I have determined it is the right time to begin a process of understanding the 

structural and managerial policies that led to the flawed launch so 

we can take action and avoid these problems in the future. 

Today I am announcing some initial steps I have taken. I have 

asked our inspector general, Dan Levinson, to investigate the development of HealthCare.gov including contractor acquisition, the 

overall management of the project and performance and payment 

of our contractors. I have asked CMS Administrator Marilyn 

Tavenner to create a new position of chief risk officer at the Centers for Medicare & Medicaid Services and to expedite the search 

and hiring. This will be a full-time employee charged with assessing risk management practices and developing strategies to minimize those risks. 

And let me be specific. I will instruct this officer to look at IT 

and contracting management practices starting with 

HealthCare.gov and the risk factors that impeded a successful 

launch. I will ask for an initial report in the first 60 days with recommendations on how we can mitigate risk as we move forward. 

And I have instructed CMS to update and expand their employee 

training, they will be required to adopt best practices for contractor 

and procurement management, rules and procedures, including internal communications and processes. These actions build on reforms we have already made which have led to significant improvements in the Web site. It includes the addition of Jeff Zients as the 

management expert and consultant to Administrator Tavenner and 

me, selecting QSSI as the systems integrator and changing the 

day-to-day CMS management of HealthCare.gov. 

Fixing a flawed Web site has proven challenging, but it is nothing compared to the challenges that American families face every 

day, particularly those families who don’t yet have health coverage, 

families who are one medical bill away from bankruptcy, one diagnosis away from not being able to afford their mortgage or their 

rent. And these efforts are about them. Before the Affordable Care 

Act, as many as 14,000 of our neighbors were losing their coverage 

10 

each and every day. The market operated inefficiently, we as a Nation paid more and got lower health results. 

Today, health care cost growth has been driven down to the lowest levels in 50 years, and millions of Americans are already benefiting from new rights and consumer protections. With the new 

marketplace, choice and competition among private market plans is 

now available to millions of Americans. But our work is not done 

until every eligible American has the opportunity to access affordable coverage. 

Thank you, Mr. Chairman. 

[The prepared statement of Ms. Sebelius follows:] 

11 

12 

13 

14 

15 

16 

17 

18 

Mr. PITTS. The Chair thanks the gentlelady. I will begin questioning and recognize myself 5 minutes for that purpose. 

Madam Secretary, based on current trends, it is likely that more 

individuals will have lost coverage on January 1st than will have 

gained it under the law. HHS released data this morning stating 

that approximately 364,000 Americans have selected a plan 

through a State or a Federal exchange. Is that correct? 

Ms. SEBELIUS. Yes, sir. 

Mr. PITTS. Of these 364,000 Americans, do you know how many 

of those individuals will actually have coverage in effect on January 1, 2014? 

Ms. SEBELIUS. Sir, once they pay their premium, they will have 

coverage in effect. 

Mr. PITTS. So you don’t know. These are the ones who have just 

selected plan but haven’t paid their first payment on the premium? 

Ms. SEBELIUS. Some may have paid, some may not. We are giving you the enrollment numbers. 

Mr. PITTS. Do you even—this is a critical statistic, it is clear 

HHS knows the number of Americans who essentially have put a 

plan in their shopping cart. Your testimony includes data on the 

number of users who can use HealthCare.gov simultaneously and 

the number of Web site hits. However, this most critical statistic, 

the number of Americans who will actually have coverage effective 

January 1, do you have an estimate? 

Ms. SEBELIUS. Sir, I think 365,000 through the end of November 

have enrolled in coverage, and we are dealing with the issuers to 

confirm their actual payment. 

Mr. PITTS. Would you define ‘‘enrollment’’? Define what you 

mean by ‘‘enrollment.’’ 

Ms. SEBELIUS. We are giving you the numbers of individuals who 

have chosen a plan. 

Mr. PITTS. But not actually paid their first premium—— 

Ms. SEBELIUS. That is correct. 

Mr. PITTS [continuing]. Or received a card? 

Ms. SEBELIUS. Through the end of November, yes. Payment isn’t 

due as you know, sir, until mid December in order to be fully covered. So we don’t have those numbers, and I think most Americans 

probably will not pay until their money is owed. 

Mr. PITTS. So you can’t guarantee the actual number of constituents who have coverage that they—— 

Ms. SEBELIUS. Not until they pay their premium. 

Mr. PITTS. In October, the AP reported that a September 5 memo 

sent to you listed monthly enrollment targets for the exchanges, 

and this memo indicates that your target enrollment number for 

the end of December is 3.3 million. Based on HHS’ release this 

morning, your Department is more than 3 million off their target 

number, isn’t that correct? 

Ms. SEBELIUS. Through the end of November, that is correct, sir. 

Mr. PITTS. Some news reports have indicated that as many as 5.6 

million individuals have had their policy canceled. Isn’t it the case 

that on January 1, more Americans will have their coverage canceled than will have enrolled in an exchange? 

Ms. SEBELIUS. Well, sir, I don’t know where the 5 million number 

comes from. I know people have been told that their health plan 

19 

doesn’t necessarily match the ACA compliant plans. They are not 

in a grandfathered plan, and a number of those individuals have 

already re-enlisted and enrolled in plans. So losing coverage and 

being notified that the plan that they had doesn’t exist anymore 

are two very different things. 

Mr. PITTS. Now much like the millions of cancelations in the individual market, the Affordable Care Act requires group coverage 

to also comply with HHS standards, and many of these plans could 

be canceled next year as well. 

Madam Secretary, the issue with the canceled plans and the 

President’s broken promise that if you like it you can keep it, this 

is because some of those individual plans did not comply with the 

health care law’s 2014 requirements, correct? 

Ms. SEBELIUS. That is true, sir, or they did not stay in a grandfathered plan. What the law said from the outset is if insurers left 

the plan in place that an individual had in March of 2010, and 

there are millions of Americans who are in those grandfathered 

plans, that the plan stayed in effect through the implementation of 

the Affordable Care Act. 

Mr. PITTS. Now, what about small group market plans used by 

small businesses and their employees. Don’t these have to comply 

with the ACA standards? 

Ms. SEBELIUS. In the same way. If the grandfathered plans 

stayed in effect, they could still be in effect. If not, the consumer 

protections that are available through the Affordable Care Act 

would come into play. 

Mr. PITTS. Could some small group plans be canceled because 

they do not comply with the ACA? 

Ms. SEBELIUS. Yes, sir. And, again, insurers cancel plans each 

and every year. They change plans, they change networks. That is 

part of the market strategy. 

Mr. PITTS. Madam Secretary, before passage of the health care 

law, President Obama routinely promised that the average family 

would save over $2,000 on their premiums. Would you agree today 

that this simply is not true, every family will see premium decreases? Some will see increases? Yes? 

Ms. SEBELIUS. Well, Mr. Pitts, I think that the President talked 

about health care costs going down for Americans. I think that we 

have adequately documented that health care costs, indeed, have 

gone down based on the trajectory that we would have seen, absent 

the Affordable Care Act, underlying health costs are rising at the 

lowest rate in 50 years, Medicare costs have risen at this lowest 

rate, Medicaid costs have actually come down per capita throughout the country, and private insurance rates are rising at the lowest level that they have in decades. So Americans are seeing a very 

different cost trajectory than they would have absent the passage 

of the Affordable Care Act. 

Mr. PITTS. My time is expired. Thank you, Madam Secretary, for 

your responses. The Chair now recognizes the ranking member Mr. 

Pallone 5 minutes for questioning. 

Mr. PALLONE. Thank you, Mr. Chairman, and again, Madam Secretary, I don’t want to keep beating a dead horse here but this 

whole idea that we hear from the Republicans that the world is 

turned upside down and this, ACA is a disaster is just the opposite. 

20 

As you point out, health care costs you know are going down, rates 

are rising at a less of a level. This whole idea of the President saying if you like it, you can keep it, I mean the President didn’t say 

that if you had a lousy health insurance policy that didn’t cover everything that he was to suggesting that insurance companies continue to sell it and therefore you buy it. I was at the Rules Committee the other day when the President issued his executive order, 

and I had one of my colleagues from Florida, one of my Republican 

colleagues, talk about how his constituents should be able, should 

have the freedom, she used the word ‘‘freedom,’’ to keep his or her 

health plan that cost $60 a month. And I asked, well, what is this 

health plan? It didn’t include hospitalization. I don’t think the 

President meant that you should have the freedom to keep a health 

insurance plan that didn’t include hospitalization, I mean, if you 

want it, his executive order says you can do it, but I think it is absurd to keep arguing over these lousy skeletal plans. 

In any case, the reality is that enrollment is accelerating, and I 

wanted to ask you about enrollment. The numbers released today 

are impressive, and I wanted to get some broader context from you 

on how enrollment is progressing. We always expected enrollment 

to be slow in the early months, and that is what happened in Massachusetts when they implemented the health care reform. In the 

first month, only .03 percent of people in Massachusetts who ultimately signed up actually enrolled. But the clear trend in the report released today in the reports from the States is that enrollment is surging. In November, there were four times more enrollments in private plans than in October, more than 1.2 million enrolled in private plans that were found eligible for Medicaid, and 

more than 1.9 million people were eligible for marketplace coverage, employees were enrolled as soon as they select the plan, 3.7 

million have applied for coverage. But the most important fact is 

the trend, the pace of enrollments at the end of the month was 

double the pace at the start of the month, and that trend appears 

to be continuing. 

Press reports have indicated that more people have signed up for 

private coverage through the Federal marketplace on November 

30th and December 1st than signed up for all of October. Another 

press report noted that more people selected a plan in the first 

week of December than selected one in the whole of November. 

These are exciting signs. So just given the technical issues we 

have had and the corresponding delays in much of the outreach 

campaigns, how would you measure the progress at this point in 

terms of enrollment? 

Ms. SEBELIUS. Well, Mr. Pallone, I don’t think there is any question that the flawed launch of the Web site put a damper on people’s enthusiasm about early sign-up. We had a lot of visitors early 

on who got very frustrated and have not reengaged. We have been 

inviting them back to use a newly improved site, and we are seeing 

some very, very positive trends in that direction. 

So I don’t want to minimize the dampening effect that the flawed 

technology has, not just on the Federal Web site, but I think on 

news reports also, I think dampened enthusiasm at the State level. 

It was hard for California, for instance, to ensure people that their 

21 

site was fine while there was a lot of news day in and day out 

about the flawed site. 

Having said that, we are seeing very, very positive trends. We 

are seeing a lot of people reengage. And it is about not only just 

the numbers of individuals, but at the end of the day, hopefully 

getting the right mix of individuals and we know that a lot of 

younger Americans are very tech savvy, want a fully functioning, 

easy-to-operate site and so getting HealthCare.gov up and running 

correctly also helps with some of these targeted numbers. 

Mr. PALLONE. I appreciate that. Let me just say, I only got 50 

seconds here, at my forum, as I said, which was very successful in 

Highland Park and people were happy with what we were doing 

the other night, they were particularly pleased that you had that 

option where you didn’t have to, you know, basically provide all 

your information, but could comparison shop without actually enrolling. I thought that was very good. 

And still do encourage people to use alternatives. I know you are 

right, a lot of people like to use the Web site. But I know there 

were a lot of people at my forum who were, you know, calling the 

800 number, going to community health centers, and also we had 

some insurance agents and brokers there, and I think that I notice 

that there is, I think we should encourage that as well as alternatives. 

Ms. SEBELIUS. We have been conducting some pilots with a large 

number of insureds in key States. I think they have gone extremely 

well. We are encouraging insurance companies to have their agents 

and brokers directly enroll, and I think that experience has been 

very productive and we are working closely with them on the kind 

of technology fixes that they would find most effective. 

Mr. PALLONE. Thank you. Thank you, Mr. Chairman. 

Mr. PITTS. Thank you, Madam Secretary. The Chair now recognizes the chairman of the full committee, Mr. Upton, 5 minutes for 

questioning. 

Mr. UPTON. Well, thank you, Mr. Chairman. So the goal was to 

enroll 7 million Americans by the end of March, 365,000 folks enrolled through the end of November, premiums are due beginning 

mid December. I wonder, Madam Secretary, if you could tell us 

after Christmas somewhere between Christmas and New Year’s as 

to how many people actually do pay the premium that is due, if you 

could share that number during the Christmas break with us. 

Would that be possible if you could get a number mid December? 

Ms. SEBELIUS. Chairman Upton, we—the deadline to enroll is the 

23rd, the deadline to pay is the end of the year, so we will not have 

a number until some time in early January. 

Mr. UPTON. So the first of the year? Can you let us know that 

first week as to how many people actually paid? 

Ms. SEBELIUS. I will let you know as soon as we have the numbers, sir. 

Mr. UPTON. You indicated to Mr. Pallone that, in fact, the launch 

was flawed. Knowing what you know today, do you wish, in fact, 

that you had delayed the launch beyond October 1st? 

Ms. SEBELIUS. Well, I certainly wish we could have saved millions of people a very frustrating experience and had a smoother 

technology launch. I acted on the best information that I had. And 

22 

going forward, I think that having an 8-week delay in a fully functioning site is enormously frustrating to millions of Americans and 

their families. 

Having said that, I think there are millions of people who are 

going to begin receiving health coverage that they never had January 1st and into the new year, and so on balance, I am not sure 

what the right answer is. The law’s benefits went into effect January 1st. People needed some time to sort out options. We clearly 

put a dent in that time, but there are going to be millions of Americans with new health coverage, and that will continue on into the 

new year. 

Mr. UPTON. So knowing what you know today, you would have 

started the launch October 1? 

Ms. SEBELIUS. I would have probably done a slower launch 

maybe with fewer people and done some additional beta testing, 

which is part of what has happened, frankly, in the early months 

of the launch to identify what problems we had. 

Mr. UPTON. So let me go a little deeper. So what grade, if you 

could give yourself, not you, but HHS, the grading of the launch 

from A to E or incomplete what would you give the—— 

Ms. SEBELIUS. Mr. Chairman, I have already said that I think 

the launch was flawed and failed and frustrating for millions of 

people. Unacceptable, we want to both figure out exactly the chain 

of events, what went wrong, which is why I have asked the Inspector General help do this investigation. We have made some 

changes. 

And what we are doing is moving forward. We want to make 

sure that the millions of people who are eager for affordable health 

coverage have that opportunity before March 31. 

Mr. UPTON. So you announced the IG investigation yesterday. Do 

you wish that you had started that maybe this summer asking 

some tough questions in terms of where things were knowing what 

you knew back then? 

Ms. SEBELIUS. I didn’t have cause to ask the IG to be involved 

last summer, no, sir. 

Mr. UPTON. The day after Thanksgiving, the administration announced that States would be permitted to use incomplete enrollment information to sign people up for Medicaid. Is it possible that 

by using incomplete enrollment information, States could be enrolling folks the most vulnerable, by the way, for Medicaid who are not 

actually eligible? 

Ms. SEBELIUS. Sir, we are working very closely with States 

around Medicaid eligibility, making determinations based on 

States’ specific laws which they have an opportunity to sign off on. 

So when someone presents at the Web site, and we review their eligibility criteria based on the law of Michigan, we determine preliminary eligibility and send that file to the State. 

At the same time the State is doing the same thing for people 

from Michigan who may come to the State Medicaid office thinking 

that they are Medicaid eligible and are determined to be marketplace eligible they are returning the files to us. 

Mr. UPTON. But the information is incomplete, is it not? 

Ms. SEBELIUS. Sir, I am not sure what you are referring to. We 

are gathering data and information and eligibility. And again, the 

23 

State makes the determination based on their State law and based 

on the information that we have selected. 

Mr. UPTON. So are income and residency requirements a part of 

that information that has to be verified? 

Ms. SEBELIUS. I am sorry incoming—— 

Mr. UPTON. Income and residency. 

Ms. SEBELIUS. Yes, sir. The State again makes the final Medicaid 

determination. We make the preliminary determination and send 

an individual to the State. If the State doesn’t confirm that they 

meet those requirements, they will not enroll the individual. We 

have now, as of last night, again, got the systems automated so 

these files will be sent automated, but we are also sending what 

we call flat paper files with full information to the States and 

working one at a time with States, particularly those States like 

Michigan which has expanded Medicaid for their population to 

make sure that the data is verified. By the State makes the final 

Medicaid determination, not the Federal Government. 

Mr. PITTS. Thank you, Madam Secretary. The Chair now recognizes the ranking member of the full committee, Mr. Waxman, 5 

minutes for questioning. 

Mr. WAXMAN. Thank you very much, Mr. Chairman. 

I know that there is a lot of politics around this issue. And I certainly understand that changing to a system that is more fair and 

stable for every American, not just a few, but every American, is 

not easy. But all of this is exacerbated by wild propagandists’ politicized statements that have been made. Even today, the chairman said more people will have lost their coverage than will get 

coverage. Well, that absolutely cannot be true. It is not true. The 

Congressional Budget Office, which is not Democratic or Republican, it is nonpartisan, they estimated that 7 million people will 

sign up for health insurance in the first year, and that 25 million 

people will be newly insured in 2016. That is really a major accomplishment. 

Now we hear Republicans saying more people are losing their 

policies. But who are those people? We hear estimates that 80 million people will lose their insurance. When you look at that statement, they are saying that people who have a change in their policy have lost it. For example, when they get free preventive services now covered, oh, that means they are losing the policy they 

had. Or if young adults can stay on that policy up to age 26, Republicans say see they are losing that policy. Well, that doesn’t 

make sense—unless you are trying to exaggerate numbers. 

There are some small businesses in this country who have offered their employees skimpy plans. And now they are being told 

they have got to have minimum standards in those plans, so they 

are complaining a lot because they are going to have to provide decent, quality, reliable insurance. And a lot of them are helping fuel 

this argument. 

So to say that 80 to 100 million people may lose their insurance 

is absolutely crazy. It is just not true. And it is especially galling 

to some of us when we hear Republicans so saddened by people losing their insurance when we recognize that they want a status quo 

which means repeal the Affordable Care Act where we had 50 million people uninsured. That didn’t bother them. 

24 

So I just think that we ought to put this in perspective, Madam 

Secretary. This is not about this law, and it is not sincerely concern 

for the uninsured. It is just a political, constant political attack. 

The Republicans did not want to work with the Democrats, they 

didn’t want to work with the President. If this bill has problems, 

let’s work together to fix them, not talk about how it is no good, 

it is all terrible. Because I am hearing from a lot of people. 

And I think the headline in The New York Times captured this. 

The article was titled, ‘‘Amid the Uproar Over Health Law, Voices 

of Quiet Optimism and Relief,’’ they are voices like Stephanie from 

Lansdowne, Pennsylvania, who had a frustrating experience trying 

to submit her application for the first 2 months, and then after visiting a navigator at the local library, she signed up for a policy that 

will cost $113 a month with no deductible. And what she said is, 

I am one of the people whose plans were canceled and signing up 

this time was just the easiest thing in the world. 

They are the voices of Ellen and Meredith from San Diego in 

2012 they lost their coverage because they no longer lived in the 

plan service area. When they applied for new coverage, Ellen was 

denied because of carpal tunnel system. Now they have a plan 

through the exchange of $142 a month instead of the $1,300 a 

month they were paying before. They have a higher deductible 

than their old plan, but lower co-pays. And here is what they described their feelings, we felt we didn’t have to panic or worry. If 

not for the Affordable Care Act, our ability to get insurance would 

be very limited if we could get it at all. 

Madam Secretary, you have traveled around the country talk to 

people about this law. Do you think most people look at this as a 

political issue? Or are they willing to put politics aside and look at 

the plans being offered and make the decisions of what is best for 

their family? 

Ms. SEBELIUS. Well, Mr. Waxman, what I find is a lot of people 

are eager for information. They are confused by what they read 

and hear. And frankly, the launch didn’t help that. But as people 

understand their options and choices, I find that there is enormous 

enthusiasm, often huge relief. A lot of individuals who received the 

notice of cancelation are unlocked from a policy choice that they did 

not feel was good for them or their families. They were kind of 

locked into a plan. And I talk to people every day who now have 

40 or 50 choices, a range of marketplace plans, the option to pick 

and choose. 

That isn’t to say that there aren’t some individuals who would 

have preferred to stay in their plans, which is why I think the 

President decided on the transition policy in the marketplace. But 

a lot of individuals—— 

Mr. WAXMAN. They didn’t know what they had offered to them 

on the exchange. 

Ms. SEBELIUS. Who received cancelation notices are thrilled with 

the choices that are now available to them. 

Mr. PITTS. Thank you, Madam Secretary. The Chair now recognizes the vice chair of the full committee, Mrs. Blackburn, for 5 

minutes for questions. 

Mrs. BLACKBURN. Thank you, Madam Secretary. 

25 

I want to talk to you about data security and privacy. First off, 

I know you have seen the USA Today story about people in California having their information released to insurance agents, and 

this all happened after they had gone to the exchange. 

We are hearing from other States that people are having that 

same experience with Federal exchanges. So have you talked with 

the California exchange about releasing that information, help 

them to realize this is inappropriate to release that information? 

Ms. SEBELIUS. Well, I don’t think there is any question that 

there is an issue about releasing anybody’s personal health information as was done in California. And there have been certainly 

conversations about that. As you know, we don’t run the California 

exchange. That is no excuse. Privacy and security are hugely important. 

Mrs. BLACKBURN. OK. How is the information being released? 

Who is releasing it? Who all has access to that? And when it is released, are people paying for that information? And who gets the 

proceeds from the sell if you are selling that information? 

Ms. SEBELIUS. I am not sure. Are you talking about the California specific incident. 

Mrs. BLACKBURN. I am talking about any of these exchanges 

where people are getting—— 

Ms. SEBELIUS. Well, to my knowledge, the California incident is 

an isolated case. We have no information—there is certainly no information about anybody at the Federal marketplace for the 36 

States release—— 

Mrs. BLACKBURN. I think we are all getting some questions—— 

Ms. SEBELIUS. Well, there is no information released, and actually, we don’t store personally identifiable information on the hub. 

Mrs. BLACKBURN. Will you help us look into this and get to the 

bottom of it? Because people are getting phone calls, and that 

means their information is being released. 

Now, if somebody is benefiting, and if that is being sold or if 

there is some kind of transaction on that, we need to know that, 

Madam Secretary. 

Let’s go on and talk about calls—— 

Ms. SEBELIUS. But I would suggest, Congresswoman, the fact 

that they are getting phone calls also maybe if they are customers 

of an insurance company who is contacting them because their policy may be up for renewal. Those calls are underway. 

Mrs. BLACKBURN. I don’t think that is quite the case. 

But let’s go on and talk about cost. $600 million is what we know 

has been spent on the site so far. I am referencing The Washington 

Post on that. How much money in total has been spent? We are 

still waiting for the answer to that question from you. We would 

like to know how much you have obligated since October 1 for the 

cleanup of this exchange? How much money do you anticipate obligating through March of 2014? And since you are going to have the 

IG do an investigation of the contracting, are you going to make 

these contractors pay this taxpayer money back? 

Ms. SEBELIUS. Congresswoman, to date, through the end of October, and I am giving you the cleanest audited numbers that we 

have, we have obligated $677 million for the total IT costs, and 

have outlaid 319 million of that 677. Some of that includes work 

26 

clearly in the month of October, we will give you regular updates 

as we have newly audited numbers. I have asked the IG to become 

involved because I think it is very appropriate to look at all aspects 

of not only the management practices, but the contractor expenditures, the specs in the contract, the payment issues—— 

Mrs. BLACKBURN. OK. 

Ms. SEBELIUS. And I will act based on his recommendation. 

Mrs. BLACKBURN. OK, so 677 million is what you have obligated 

through the end of October. 

Ms. SEBELIUS. That is correct. 

Mrs. BLACKBURN. Of this year? 

Ms. SEBELIUS. That is correct. 

Mrs. BLACKBURN. So would you give us the additional—— 

Ms. SEBELIUS. Through the end of October, yes, that is the obligated amount. We have spent 319 million of that 677 through the 

end of October. 

Mrs. BLACKBURN. We are going to continue to watch that cost 

number very closely. 

Delays. It seems like every holiday brings another delay. So what 

should we expect for Christmas and New Year? We have had a 

total of 13 administrative delays to major aspects of the law. And 

it seems like whether it is July 4th or any of the holidays, Thanksgiving, we get a delay. So what are we looking at for Christmas 

Eve and Christmas and New Year’s Eve and New Year’s Day? 

Ms. SEBELIUS. Well, Congresswoman, I would say that we have 

extended the deadline for enrollees from the middle of December 

until the 23rd recognizing that people need some extra time over 

the holidays—— 

Mrs. BLACKBURN. OK, into the future, what can we expect? 

Ms. SEBELIUS. To choose a plan. They don’t have to pay until the 

end of December in order to be fully enrolled, and we are working 

with insurers to make sure there is a smoother transition into the 

new year. 

Mrs. BLACKBURN. Yield back. 

Mr. PITTS. Thank you, Madam Secretary. I now yield to the ranking member emeritus, Mr. Dingell, 5 minutes for questions. 

Mr. DINGELL. Mr. Chairman, I thank you for your courtesy and 

for holding this important hearing. 

Madam Secretary, welcome, and thank you for being here. 

As we all know, the Secretary is the famous daughter of a former 

member of this committee, an outstanding member from Ohio. 

Madam Secretary, we continue to hear nothing but scare tactics 

from the other side of the aisle. Rather than encouraging people to 

sign up for health insurance, doubt is being created where none exists or should. I am first to admit that the implementation of the 

law has not gone as smoothly as I would have liked, but that is, 

in no small part, due to the intransigence of many of my colleagues 

who have deliberately thrown wrenches in the gears at every opportunity. 

Moreover, my constituents continue to tell me about the benefit 

ACA continues to bring them. And I would like to share a few letters I have received recently and I ask unanimous consent that 

they be put in the record. 

27 

One of my constituents wrote as follows, ‘‘I find it absurd, embarrassing and an enormous waste of time, money and human capital 

to see the taxes being used in Washington right now to defund the 

Affordable Care Act. As an individual who has a sibling with MS, 

a father with lung cancer and a sister with a high-risk pregnancy, 

I can say with absolute personal authority that the Affordable Care 

Act will help and is critical to the welfare of families like mine.’’ 

Another constituent wrote, ‘‘I am registered with HealthCare.gov 

so that I can study and compare premium prices and I am currently paying for my 60-plus employees in Ohio and Michigan. I am 

extremely pleased that even gold coverage plans are half of what 

we were paying now. There are 72 gold plans being offered. Now 

that is competition. So let’s stop playing politics, look past the spin 

and realize what tremendous good ACA has already accomplished 

for the American people, and what more it could do if we will get 

together to make it as successful as it could be.’’ 

Madam Secretary, I would like to begin by asking you some a 

few questions about fixes to the Web site. 

Madam Secretary, is it correct that the error rate on 

HealthCare.gov is under 1 percent, yes or no? 

Ms. SEBELIUS. Yes, sir. 

Mr. DINGELL. Madam Secretary, the capacity has increased to 

allow 50,000 concurrent users and more than 800,000 visitors 

daily, yes or no? 

Ms. SEBELIUS. Eight hundred thousand minimum a day could 

come on the site. 

Mr. DINGELL. Now, as the Web site has improved, we have also 

seen an increase in the number of enrollments through the Web 

site. Today we got more good news about enrollments. 

My question, is it correct that 258,000 people selected a plan 

through both Federal and State marketplaces in November bringing the overall enrollment number to 364,000? 

Ms. SEBELIUS. Yes, sir. 365,000. 

Mr. DINGELL. Well, Madam Secretary, over 1.5 million people 

have been eligible, have been determined eligible for Medicaid, yes 

or no? 

Ms. SEBELIUS. About 800,000 Medicaid eligibilities have been determined. 

Mr. DINGELL. Thank you, Madam Secretary. 

Are you confident that enrollment will continue to increase 

quickly in the coming weeks and months? Yes or no? 

Ms. SEBELIUS. We are seeing a very positive trend, about four 

times as many people enrolled in the Federal marketplace in November as opposed to October, and we are seeing an upward trend 

in December. Yes, sir. 

Mr. DINGELL. People like—Madam Secretary, people like my constituents I mentioned earlier are seeing reduced costs when purchasing insurance through the marketplace. 

Is it correct that a recent Rand report found that premium tax 

credits will reduce out-of-pocket costs for average marketplace participants by 35 percent, yes or no? 

Ms. SEBELIUS. Well, I think, sir, if people are eligible for subsidies, they will see a significant decrease over the comparable 

plan. 

28 

Mr. DINGELL. I am running out of time. So you have to give me 

yes or no. 

Did the CBO project that 8 in 10 Americans who obtain coverage 

through the marketplace will be eligible for assistance to make 

their coverage more affordable, yes or no? 

Ms. SEBELIUS. I think the preliminary estimates were that is 

what the uninsured population certainly look like, yes. 

Mr. DINGELL. So ACA also benefits people who don’t purchase 

their health insurance through the new marketplaces. 

Now, Madam Secretary, is it correct that thanks to ACA, 3.1 million young Americans, adults, have been able to stay on their parents’ plan, yes or no? 

Ms. SEBELIUS. Yes, sir. 

Mr. DINGELL. Now, Madam Secretary, 7.3 million seniors have 

saved over 8.9 billion on their prescription drug costs thanks to 

provisions in ACA that closed the Medicare part D donut hole and 

that that donut hole will be totally closed in the year 2020? 

Ms. SEBELIUS. Yes, sir. 

Mr. PITTS. The gentleman’s time has expired. 

Mr. DINGELL. You have been very courteous, and I thank you, 

Mr. Chairman. 

Mr. PITTS. The Chair thanks the gentleman. I now recognize the 

chair emeritus of the full committee, Mr. Barton, 5 minutes for 

questions. 

Mr. BARTON. Thank you, Mr. Chairman. Before I ask my questions, first of all, merry Christmas. And who was your father who 

served on the committee from Ohio? 

Ms. SEBELIUS. John Gilligan from Ohio. 

Mr. BARTON. John Gilligan. See, I wasn’t there then. 

Ms. SEBELIUS. But you may have served with my father-in-law, 

Keith Sebelius. So we had people on both sides. 

Mr. BARTON. Just on a personal issue. Let me get to the unfun 

part and go to the questions. 

Mr. Henry Chao of CMS, when he was here several weeks ago 

in response to a question of Congressman Gardner of Colorado 

made a statement that 40 percent of the computing system hadn’t 

even been built yet, that all of what he called the back end hadn’t 

been built, which I would assume would be the accounts payable 

and accounts receivable and income verification and things like 

that. 

Could you tell us what is being done to try to get that ready by 

January the 1st since almost half the system according, to Mr. 

Chao, hadn’t even been built yet? 

Ms. SEBELIUS. Congressman, I am not exactly sure what Mr. 

Chao was referring to, but I can certainly tell you where we are 

in the build. I think the emphasis was getting the consumer facing 

portion ready for October 1. As you know, that didn’t go so well. 

The financial management system which is getting the insurance 

companies, their money for accelerated tax credits and for cost 

sharing is due to go into effect in mid January. There are also some 

other pieces of the puzzle, not income verification. That is done as 

part of the application at the very front end in order to qualify 

someone. So that is all built in. 

29 

Mr. BARTON. Well, do you agree with Mr. Chao that a large part 

of this system hasn’t been put together yet? And if so, aren’t you 

concerned about that? 

Ms. SEBELIUS. Well, it is in the process currently of being put together. The income issues, again, I want to clarify for the committee that, because it has been a bit of a misunderstanding, accelerated tax credits and cost sharing don’t go to consumers, they go 

to companies. We are dealing with 2 to 300 companies. And it will, 

we have a system that we have announced working with companies 

where they will be paid in a timely fashion as this process is being 

built. 

Mr. BARTON. I don’t want to beat a dead horse. But we all agree 

that the Web site to try to enroll people has not worked very well, 

to be as polite as possible. Now that is the easy part. So now we 

are down to, in January, there are lots of people that think they 

are going to have insurance that don’t have it now. And the part 

of the system that when they go to the doctor or to the hospital 

and they give them their new insurance card that they check to see 

if they are covered and what the coverage is, that is not there. And 

there is no system there to pay people. There is no system there 

to determine whether this doctor or this hospital is eligible, and 

you still want to get this thing started on January the 1st? 

Ms. SEBELIUS. Congressman, I think it is not an accurate statement. We certainly have a plan, and we have vetted it and discussed it with insurers that they are very comfortable with to get 

them—— 

Mr. BARTON. They were also very comfortable that October 1st 

was going to work, and—— 

Ms. SEBELIUS. Sir, this is—people will be enrolled. That system 

is in place, that is what the application is about. 

Mr. BARTON. After this, we will have you back here in mid January or February talking about this problem. 

Ms. SEBELIUS. This is reimbursing insurance companies. At the 

end of the day, it has nothing to do with enrollment. And enrollment will—— 

Mr. BARTON. I am not saying it does have anything to do with 

enrollment. Let me go to my second—— 

Ms. SEBELIUS. When people go to the doctor and go to the hospital they will have a card. They will be—— 

Mr. BARTON. I have got a minute left. I have got one more question. I want to put the slide up that says on Section 1401. Under 

the law, Section 1401 says that if you go through a State exchange 

to get insurance under what we call Obamacare, that you are eligible for a subsidy. If you don’t go through that State exchange, you 

are not eligible for a subsidy. Now, IRS has ruled that we don’t 

have to obey the law. We are going to give the subsidies if we go 

through the State exchanges or not. What is HHS’s position on 

obeying the law, and doing what the law says, which would mean 

almost everybody who signs up for Obamacare is not eligible for a 

subsidy because they are not going through the State exchanges? 

Ms. SEBELIUS. Sir, we have deferred to our partners at the Justice Department, and at the Treasury for—— 

Mr. BARTON. Now, what is your position? What is the HHS’s position? 

30 

Ms. SEBELIUS. We have referred to our partners. This is in litigation, as you know, right now. 

Mr. BARTON. I am asking what your position is? You are not worried about obeying the law? 

Ms. SEBELIUS. We feel that the law covers both State and Federal exchanges. 

Mr. BARTON. That is not what it says. 

Ms. SEBELIUS. The recommendation of the Justice Department—— 

Mr. PITTS. The Chair thanks the gentleman. Thank you, Madam 

Secretary. I recognize the gentleman from Utah, Mr. Matheson, 5 

minutes for questions. 

Mr. MATHESON. Well, thank you, Mr. Chairman, and Madam 

Secretary, thanks for joining us today. 

You know, we have already had one hearing on the Web site before now. We are all aware of some of the challenges of the rollout. 

You know, when you come before a committee there is all kinds of 

things—other topics I would like to raise with you, issues about the 

health insurance tax, or difficulties some providers are having with 

meaningful use, Stage 2, but in the—I think this hearing is more 

about rollout of Web site itself, and so I will focus on that in my 

questions today. 

I think we all know that, and you have acknowledged the criticism of the Web site when it was coming out. Let me ask you a 

question. As we go forward, have you developed sort of a master 

list of the issues that still need to be resolved, or the issues you 

are trying to anticipate as we move forward from today? 

Ms. SEBELIUS. We are doing that on an updated basis, yes, sir, 

both on a policy side and on a technology, and user side. 

Mr. MATHESON. So that is not a static list. That is an evolving 

list. As time goes on you see other things? 

Ms. SEBELIUS. Yes, sir. 

Mr. MATHESON. OK, is it possible for that list to be shared with 

the committee or is that something that we could see on this committee, or—— 

Ms. SEBELIUS. As you say, it is not a static list. 

Mr. MATHESON. Right. 

Ms. SEBELIUS. It is a dynamic list, and it is basically anticipating 

what the next policy changes are, what happens. You know, we are 

happy to give the committee an outline, but I don’t think there is 

any great secret to it. 

Mr. MATHESON. OK. OK. You know, I wanted to talk about some 

of the issues that—addressed with the 834 form, or I know the 

error rate has been dropping and enrollment is increasing at the 

same time, so you kind of have these lines going in opposite directions, both favorable directions. But that being said, do you have 

a sense of how many enrollees may have 834 errors that need to 

be addressed? 

Ms. SEBELIUS. What I can tell you, Congressman, is we know in 

the early days, there were a serious number of error, and we are 

in the process of actually hand-matching individuals with insurance companies. They have added some important personnel to the 

tech team so that they are helping to identify where the bottleVerDate Mar 15 2010 09:21 Sep 30, 2014 Jkt 037690 PO 00000 Frm 00034 Fmt 6633 Sfmt 6633 F:\113-108 PPACA FAILURES OK TO PRINT\113-108 PPACA FAILURES PDF MADE WA
31 

necks were and fixes. We are seeing a vastly improved system, but 

we want to go back and make sure—— 

Mr. MATHESON. Right. 

Ms. SEBELIUS [continuing]. That everyone who thinks they are 

enrolled in the early days is actually matched with a company, and 

that the company folks are matched on our end, and that process 

is very much underway, and a lot of fixes have been—— 

Mr. MATHESON. Right. 

Ms. SEBELIUS [continuing]. Added in October or November for 

the 834s. 

Mr. MATHESON. And in terms of that declining error rate, how 

do you calculate that? Is that an average of all of the plans or is 

that a snapshot of the subset as you go forward? How do you go 

about figuring that out? 

Ms. SEBELIUS. Well, it isn’t really plans. It is looking at the site 

and determining the errors that occur along the way, so pages that 

came up, or people got locked out or dumped out, or wouldn’t accept an ID, and that has really been the roadmap to what really 

needed to be fixed and that has been a very dynamic process that 

is still underway. 

Mr. MATHESON. Right. And following up a little bit on what Mr. 

Barton was asking you about some of the issues more on the back 

end, you know, I guess CBO has predicted about 6 million individuals are potentially going to seek subsidies, and for folks, not everyone is going to start up January 1. I understand the open enrollment period goes beyond then. But as these first month’s premiums 

for the folks starting January 1 are coming up, is there—are we 

going to have this system in place, where these subsidies and these 

payments at the back? Is the back-end system going to be structured in a way where the subsidy payments are going to be able 

to be made for this first month of participation? 

Ms. SEBELIUS. Yes, sir. They will be made and they will be made 

in a timely fashion, and they are made in a way that the insurers 

have agreed that works for them. So as the full system is being 

automated, there is a step in the early months to make sure that 

the payment to insurers, again, an individual will be enrolled, 

qualified for a subsidy. The insurer will accept a premium. At that 

point, that individual is insured, and has full benefits. Starting in 

mid-January, the insurance companies then receive reimbursement 

for the tax credit and cost sharing, if it is eligible for individuals, 

so it is a two-step process. 

Mr. MATHESON. Right. 

Ms. SEBELIUS. One affects the individual. The second affects the 

companies, 2- to 300 companies total. We have a system that, 

again, has been signed off by them in terms of getting them paid 

in a timely fashion and we will absolutely do that. 

Mr. MATHESON. And the subsidies go directly to the insurance 

companies? 

Ms. SEBELIUS. Yes, sir, not to the individual. 

Mr. MATHESON. OK. And so when we hear about these problems 

about needing to build up the back end, you are saying that this 

particular component you have got—— 

Ms. SEBELIUS. Well, there is a manual workaround, I would say, 

for virtually everything that isn’t fully automated yet. It is in place. 

32 

It just will be manual until the automation is fully complete and 

we have tested it and made sure it works. But in the meantime, 

the payment system will absolutely go forward. 

Mr. MATHESON. OK. Thank you. I yield back, Mr. Chairman, 

thank you. 

Mr. PITTS. The Chair thanks the gentleman. I now recognize the 

vice chairman of the subcommittee, Dr. Burgess, 5 minutes for 

questions. 

Mr. BURGESS. Thank you, Mr. Chairman, and Secretary, welcome 

back to committee. I may not have an opportunity to go through 

all of the things on the list. We have submitted questions for the 

record in the past. We have not received answers to those. So let 

me, again, encourage you to respond to previous questions and to 

these question, because they are important and constituents are 

asking us, in fact, constituents on a telephone town hall earlier this 

week, single mother, earns just over the amount so good for her. 

She has got a good job; works for a small employer; lost their insurance in the small group market. 

Now she is being hit with a premium, an unsubsidized premium 

for which she is not eligible for a subsidy of $1,500 a month for her 

and her child. I mean, when you were working through the nuts 

and bolts of establishing this law, did that situation come to mind? 

Were you concerned at all about that individual? 

Ms. SEBELIUS. I am concerned about all individuals having affordable health coverage, yes, sir. 

Mr. BURGESS. Well, apparently she doesn’t have affordable 

health coverage. In her opinion, she lost her employer small group 

market coverage. 

Ms. SEBELIUS. The employer chose to drop the coverage then. 

Mr. BURGESS. Because of the expense involved with that. OK, 

you were here in April. I think it was April 18th. You had just received 2 weeks prior a Red Team discussion document from 

McKinsey Group. My information is that you were briefed on this 

report 2 weeks prior. That is what is listed on the final page of the 

report. Let me just play a little clip of our interaction from April. 

OK, that is going to take too long. Let me just tell you what we 

are dealing with. The study that the McKinsey Corp—Group put 

together dealt with the readiness of HealthCare.gov. I was asking 

you about the readiness, and you replied that we are moving 

ahead. We have a Federal hub on track and on time. Do you recall 

that exchange between the two of us? 

Ms. SEBELIUS. I am sure that exchange took place, sir. 

Mr. BURGESS. But here is the question. Two weeks before you 

were told by the McKinsey Corporation or the McKinsey Group, 

that number one, they weren’t allowed—they found extensive problems. They weren’t allowed to change the launch date. The thing 

had to launch at full volume, and that no one was in charge. The 

completed project was a moving target. So you were aware of all 

of that when you came and testified before the committee in April, 

were you not? 

Ms. SEBELIUS. Sir, I asked for the McKinsey Group to come in 

6 months ahead of launch date and give us an analysis of their best 

advice. I was briefed on it and we acted on their recommendations. 

33 

Mr. BURGESS. You were the one who commissioned the McKinsey 

Group report? 

Ms. SEBELIUS. Pardon me. 

Mr. BURGESS. You were the one who commissioned the McKinsey 

Group? 

Ms. SEBELIUS. We asked for them to come in, yes. 

Mr. BURGESS. You yourself? 

Ms. SEBELIUS. Yes, sir. 

Mr. BURGESS. Well, again, I just have to ask you, what did you 

do with that information because you weren’t being honest with us 

2 weeks later when we were talking about it in committee. 

Ms. SEBELIUS. Sir, I would disagree. We wanted the report 6 

months out to make sure that we had independent eyes and ears 

look at the readiness, look at the challenges, and we took their advice very seriously. I would tell you, sir, that their primary advice 

focused on the reliability of the hub. They thought that would be 

where the large number of problems occurred. We focused a lot of 

time and attention. We looked at—— 

Mr. BURGESS. And may I submit that they were actually accurate 

in that assignment. 

Ms. SEBELIUS. The hub has worked beautifully from start to finish. 

Mr. BURGESS. Look, you have testified this morning that there 

is—people cannot actually make their payment now when they go 

on HealthCare.gov. 

Ms. SEBELIUS. No, that is not accurate, sir. I said a lot of people 

haven’t yet made their payment. Their payment isn’t due. 

Mr. BURGESS. I was unable to make my payment on 

HealthCare.gov on the Federal exchange from the State of Texas, 

and I was told you can’t make that payment. I have not—— 

Ms. SEBELIUS. When you are an insurance company you don’t 

pay the Federal Government. We are the sign-up site and you 

make the payments directly to the insured. 

Mr. BURGESS. OK, December 23rd, you said if someone has 

worked through the process, they are going to be covered. But payment may not have been made, is that correct? 

Ms. SEBELIUS. What I said, sir, is that you have to be enrolled 

by the 23rd, and make a payment by the end of the year in order 

to be fully insured. And the insurance—— 

Mr. BURGESS. Who is going to guarantee that the doctor that 

sees that patient on January 4th is actually covered for that visit? 

Are you going to make—— 

Ms. SEBELIUS. Same as they do today. You are enrolling in a private insurance plan. You have to pay your premium in order to—— 

Mr. BURGESS. What if that patient doesn’t make the premium 

payment? You said they are covered December 23rd, but they never 

write the check. They never make the payment. 

Ms. SEBELIUS. Then they are not covered. 

Mr. BURGESS. But they think they are covered. 

Ms. SEBELIUS. They are not enrolled. And at every point along 

the way on the Web site, they are told they until they make the 

payment—— 

Mr. BURGESS. Well, are you going to make good for those doctors 

who see those patients the first couple weeks of January who then 

34 

have their cash flow interrupted? I will just tell you, for practicing, 

in a small practice, you get your cash flow interrupted for 2 or 3 

weeks, that is big trouble. 

Ms. SEBELIUS. Well, again, if an insurance company gives an enrollment to a customer, they will make good with the provider. We 

tell people over and over again, they are enrolled when they make 

a payment. We turn their name over to the insurance company. 

Mr. BURGESS. But you said earlier this morning—— 

Ms. SEBELIUS. And that insurance company deals with their new 

customer. 

Mr. BURGESS [continuing]. If they are enrolled by the 23rd, they 

are not going to be covered. 

Ms. SEBELIUS. Sir, not until they pay, and that is what every 

step along the way. 

Mr. BURGESS. Do you know how hard it is to actually make that 

payment, pull the billfold out and actually make the payment? 

Have you done that yourself? 

Ms. SEBELIUS. I have not. 

Mr. BURGESS. Well, I am going to tell you, it is almost impossible. I have never seen a business where you get to the point, the 

fundamental business transaction, you are going to make the payment, and you can’t do it. 

Mr. PITTS. The gentleman’s time is expired. Thank you, Madam 

Secretary. The Chair recognizes the gentleman from Georgia, Mr. 

Barrow, 5 minutes for questions. 

Mr. BARROW. Thank you, Mr. Chairman, and thank you, Madam 

Secretary, for being with us today. I am glad there has been some 

progress since the last time we met, but I am still concerned what 

is going to happen when the insurance that is mandated under 

that goes live at the first of the year. I voted against the health 

care bill, in large part, because I thought the whole thing was just 

unmanageably big to begin with, and I am worried that we have 

only seen the tip of the iceberg. I hope I am wrong about that. 

I want to ask you about other approaches toward the fundamental chore of trying to get folks enrolled in plans required under 

the Act. Are there other—are there other insurance plans out there 

that are Internet-based? Aren’t there other folks who are selling 

health insurance on Internet-based exchanges? 

Ms. SEBELIUS. I think some of the companies haveInternet sites, 

and I know that the Esurance, eHealth brokers have a variety of 

plans available. I can’t tell you how broad based that is, but I know 

a number of companies you can either sign up in person with an 

agent or broker, or sign up online. 

Mr. BARROW. To what extent were efforts made to reach out to 

such folks to try and learn from what they are doing, or to try and 

utilize the technology that they are already utilizing to sell health 

insurance on the Internet? 

Ms. SEBELIUS. Well, I think there was a lot of outreach, and a 

lot of conversation about what works and what doesn’t. I would 

suggest that this is a unique, integrated product because not only 

is an individual identified and verified, but can qualify then for a 

tax credit and cost-sharing based on his or her income, can be 

qualified for not only the Federal marketplace, but Medicaid CHIP 

services, and in the Federal Web site, each plan, each State offers 

35 

a different number of plans, each State has a different set of Medicaid rules, and each State has a different level of benefits. 

So it is basically an integrated system that tries to get you to the 

right place so you can make a choice. 

Mr. BARROW. Well, are private health insurance plans that are 

operating on their own Internet-based health exchanges, actually 

able to take advantage of the unique features of the law, the fact 

that you get subsidies if you are income eligible, the fact that there 

are specific packages that are required—— 

Ms. SEBELIUS. Not unless they verified that information through 

the hub. No one can have—— 

Mr. BARROW. Is that being done? Can it be—— 

Ms. SEBELIUS. Yes, sir. 

Mr. BARROW. It is being done? 

Ms. SEBELIUS. It is. 

Mr. BARROW. Through private insurance companies? 

Ms. SEBELIUS. Yes, sir. 

Mr. BARROW. Who? 

Ms. SEBELIUS. They don’t have direct access to the hub. They 

come into the hub through CMS—— 

Mr. BARROW. I understand that. I understand the aspects. 

Ms. SEBELIUS. Well, Blue Cross Blue Shield and Web plans are 

doing this direct enrollment all over the country now that the site 

is functioning. 

Mr. BARROW. Well, the reason I ask is, if there are other sites, 

other Internet-based exchanges already functioning, it seems to me 

that it would be a very helpful approach to have all hands on deck 

in trying to do that. 

Ms. SEBELIUS. Well, I am sorry. To clarify, they are. The eHealth 

insurance folks are now engaged and involved. The broker is involved in that. The companies are directly involved as well as individuals navigating on their own. 

Mr. BARROW. Are you telling us that folks who would otherwise 

be able to get health insurance through HealthCare.gov can get 

their insurance through a private Internet-based exchange such as 

eHealthinsurance.com? 

Ms. SEBELIUS. Well, it again, has to—if they are subsidy eligible, 

they need to touch the hub and get that verified so that that subsidy goes forward with—— 

Mr. BARROW. Who is the ‘‘they’’ that need to do that? The insurance companies you are dealing with or the customer? 

Ms. SEBELIUS. Well, sitting in the office with a broker; they can 

do it with the eHealth insurance folks; they can do it on their own; 

they can do it with a navigator. They can do it on the call center. 

So there are a whole variety of ways that individuals can do that. 

If they are not subsidy eligible, if they make more than $46,000 as 

an individual or about $92,000 as a family, they can just go directly 

enroll in a marketplace plan with their—— 

Mr. BARROW. I recognize that, but again, back to the point you 

began with, the role that HealthCare.gov is supposed to provide is 

to try and match folks up with the subsidies as well as the products that are out there and you are saying that can be done 

through private exchanges that exist right now. It doesn’t have to 

be done through HealthCare.gov. 

36 

Ms. SEBELIUS. Again, they—the subsidy eligibility which involves 

verification of income, verification of citizenship, verification that 

you are who you say you are—— 

Mr. BARROW. Right. 

Ms. SEBELIUS [continuing]. Has to touch HealthCare.gov. Other 

than that, the enrollment process can be done in any—— 

Mr. BARROW. That touching, that front door that is provided by 

a private Internet-based exchange communicates with folks in the 

back room at the government, on the government end, is that correct? 

Ms. SEBELIUS. Well, again, they do not have access to the Social 

Security database, to the IRS database, to the Homeland Security 

database, that is the piece that verifies the individual’s eligibility, 

and can move them forward, but that is being done now by agents 

and brokers, by the eHealth folk, by a variety of people along the 

way. 

Mr. BARROW. Thank you, Mr. Chairman. 

Mr. PITTS. The gentleman yields back his time. Thank you, 

Madam Secretary. The Chair now recognizes the gentleman from 

Kentucky, Mr. Whitfield, for 5 minutes for questions. I would like 

to ask the gentleman from Pennsylvania, Dr. Murphy, to take the 

chair. 

Mr. WHITFIELD. Well, thank you, Mr. Chairman, and Madam 

Secretary, thank you for being with us. Mr. Waxman admonished 

us to treat you with respect, and I think that certainly, we should 

do that, and we want to do that. But I will tell you, my very first 

concern is with the constituents that we represent. And some people have said that we are simply trying to put obstacles up for the 

successful implementation of this Act. And I can tell you for myself 

and many others, we are here because our constituents are genuinely concerned and upset about what is going on. And a lot of it 

begins with the way this bill was passed. 

When it came to the floor, the most comprehensive change for 

health care in America that has ever been undertaken, no one 

could offer one amendment to the bill. And I would—so there are 

very deep feelings about this still, and many health care experts 

today say that we are going quickly to a two-health care system. 

We are going to have one health care system for wealthy Americans, and then everyone else is going to be under the Affordable 

Care Act. 

And that is exactly what has happened in other countries that 

have gone down this path. Now, when this legislation passed, your 

office was given immense powers and decisionmaking authority, 

and we know that many regulations have been written. 

Could you tell me how many pages of regulations have been written to implement this Act? 

Ms. SEBELIUS. Sir, I can get you that number. I do not know. 

Mr. WHITFIELD. Do you have any idea? 

Ms. SEBELIUS. I don’t know how many pages. 

Mr. WHITFIELD. Do you have a range? 

Ms. SEBELIUS. I would like to get you accurate information. 

Mr. WHITFIELD. I mean, is it 100 pages, or—— 

Ms. SEBELIUS. Sir, I will get you information. 

Mr. WHITFIELD. So you don’t know. 

37 

Ms. SEBELIUS. I just told you, I don’t know. 

Mr. WHITFIELD. OK. Now, the President went all over the country talking about how this is going to save money, people are going 

to have lower premiums. And I can tell you, those of us on the Hill 

who have been going on the DC health exchange, have discovered 

that our premiums are certainly much higher than they were, and 

when we talked to our constituents going on the exchanges, we are 

discovering that the majority of them, their premiums are much 

higher. And my understanding, OMB has said that the subsidy will 

cost the taxpayers over $1 trillion. We have been told that—I am 

sorry? 

Ms. SCHAKOWSKY. Will save. 

Mr. WHITFIELD. Will save? Well, the subsidy will cost the taxpayers $1 trillion. Somebody has got to pay for it. And I would also 

like to ask you a question because of what is perceived as a real 

inequity in this system, how some people are being favored, other 

people are not being favored. 

When you go to the rotary club and speak, and people ask you, 

do you have to go on to the exchange? Does the President have to 

go into the exchange? Do the political appointees have to go onto 

the exchange? And you say no, does that—do you think that is fair 

that the rest of the American people have to go under this exchange, but you and the people in the President’s—in the executive 

branch of the government do not have to go on the exchange? 

Ms. SEBELIUS. Well, sir, I would tell you that the vast majority 

of Americans with insurance also will not be on the exchange; 177 

million people have—— 

Mr. WHITFIELD. But I am asking about you. 

Ms. SEBELIUS [continuing]. Employer-based coverage. It is, as I 

said to this committee, in October, illegal for me to go on to the 

exchange. I misspoke slightly because the reason it is illegal for 

me, which I knew, is I am an old lady. I am Medicare eligible. It 

is illegal for a company to sell me a policy because—— 

Mr. WHITFIELD. You don’t have to go under Medicare, though. 

Ms. SEBELIUS. I am not allowed to be sold a policy in the private 

market, if you are over 65, and I am. 

Mr. WHITFIELD. Thank you for your comments, but the bottom 

line is the executive branch of government does not have to go on 

the exchange. Everyone else does have to go on the exchange. 

Now, in addition to the $1 trillion that the taxpayer is going to 

pick up on the subsidy, they are going to pick up another $710 billion because the President agreed that the Federal Government 

would pay more of the State Medicaid cost. 

Ms. SEBELIUS. Sir, that is fully paid for in the health care law, 

and in fact, CBO has estimated that it reduces the deficit—— 

Mr. WHITFIELD. It is fully paid for by the taxpayer dollars, by 

general fund dollars. 

Ms. SEBELIUS. Unlike Medicare Part D this actually, this bill was 

paid for—— 

Mr. WHITFIELD. And then let me just tell you this. The President 

said that everyone’s premiums would be free. The President said 

that people would be able to keep their plan. The President said 

they would be able to keep their doctor. It is turning out that that 

38 

is simply not the case, and so there is a lot of frustration, and we 

are upset about it, and my time is expired. So thank you. 

Mr. MURPHY [presiding]. Thank you. The gentleman’s time is expired. Ms. Schakowsky, you are recognized next for 5 minutes. 

Ms. SCHAKOWSKY. Let me clarify some things using the Dingell 

yes-or-no strategy. Is it not true that the Congressional Budget Office said that 8 out of 10 Americans who will go to the marketplace, 

will qualify, should qualify for assistance? 

Ms. SEBELIUS. I think that is true. 

Ms. SCHAKOWSKY. And yes or no, is the Affordable Care Act paid 

for? I know you referred to that, but if you could explain that. 

Ms. SEBELIUS. It is paid for, and in fact, again, the Congressional 

Budget Office estimates that it will reduce the deficit in the first 

10 years by about $120 billion and then over the next 10 years, reduce it closer to $1 trillion. So defunding, or delaying, or repealing 

the Affordable Care Act actually adds to the deficit. 

Ms. SCHAKOWSKY. And isn’t it true that many of the people that 

have gotten these letters about the cancellations will be able to go 

to the marketplace and find something better, or at least as good? 

Ms. SEBELIUS. Well, again, in the individual insurance market, 

which is what we are talking about, the plans change on a very 

rapid basis, are constantly refreshed. So having a plan cease to 

exist is not a novel idea. There are a significant percentage of people who will be grandfathered in, have the same plan they had in 

March. They don’t change at all. 

For others, they will have choices, many of them that they never 

had before, both to get some assistance, financial assistance if they 

don’t have affordable coverage in their workplace, get some financial assistance paying for health coverage, but also be able to 

choose in a competitive marketplace and not be locked out because 

of a preexisting condition; not pay 50 percent more because they 

are a woman; not be worried about being dropped or kicked out if 

they get sick down the road. 

Ms. SCHAKOWSKY. You know, we have been going by anecdote, 

and so I wanted to just read you a letter that I got. I am going to 

contribute to the anecdote pile from Jeanine and Jeff. It says: 

‘‘Since so much of the Affordable Care Act debate has focussed on 

anecdotes instead of the many benefits, such as not denying coverage for preexisting conditions, and coverage for young adults 

under 26, we thought we would share with you our positive experience with the Web site. Like many American families, our young 

adult children asked for help reviewing the options and making the 

health insurance decisions while they were visiting us over 

Thanksgiving weekend. We went to HealthCare.gov and it worked. 

Not only did the Web site work, but it was easier to navigate and 

faster than the Web sites of the private-sector health insurance 

companies. The other good news is that our daughter, Erica, is 

pregnant with a baby due in March of 2014. Her current health insurance policy is expiring on December 31st, and were it not for the 

Affordable Care Act, it is unlikely that a woman who is 6 months 

pregnant would have been able to obtain health insurance at all. 

The ACA is helping her just when she needs it the most.’’ 

39 

I have two others that I would actually like to submit for the 

record, positive stories that I am getting. 

[The information follows:] 

40 

41 

42 

Ms. SCHAKOWSKY. We are getting more and more of those stories, 

and I just want to say to you, Madam Secretary, I am absolutely 

confident that the role that you played in bringing affordable 

health care to millions, tens of millions of Americans, will go down 

in history as one of the great achievements of our country throughout its entire history. And I just want to thank you for that. I understand and fully agree that the rollout was, you know, is unpleasant, and as horrible as it could have been, probably, but by 

the new year, and into the new year, we are going to find all of 

these stories. 

My understanding is that 39 million people went to the—either 

State or Federal Web sites during November. Is that true? 

Ms. SEBELIUS. I think that is accurate. We know we had, at least 

at the Federal Web site, 5 million visitors in the first 6 days of December. 

Ms. SCHAKOWSKY. And what do you think that indicates? 

Ms. SEBELIUS. Well, as we have seen all along there is tremendous interest. There is now a very updated and easy-to-use anonymous shopper that will give people information before they go on 

and enroll, and what we are seeing is people coming back several 

times. This is an important decision. It is important for them and 

their families. And visiting the site, they are eager for information, 

and they are desperate, many people, for affordable health coverage 

that they have never had before in their lives. 

Ms. SCHAKOWSKY. Thank you. I yield back. 

Mr. MURPHY. The gentlewoman’s time is expired. I now recognize 

the gentleman from Illinois, Mr. Shimkus, for 5 minutes. 

Mr. SHIMKUS. Thank you, Chairman. Thank you, Madam Secretary. I am going to try to be nice, and polite, and kind. And it 

is difficult because we are frustrated because we really want to get 

some of the truth out. Last Congress, you testified, and to me, and 

to this committee, that we actually, we double counted the $500 

billion; $500 billion was counted to preserve Medicare; $500 billion 

went to—was credited to pay for Obamacare. You admitted that. So 

you can’t tell us that this is paid for when we double counted $500 

billion. I just want to put that on the record. And as for the 

amounts of enrolled, in Illinois 1,300 have enrolled in a plan, 1,300. 

Twenty times more have enrolled in Medicaid. And this Medicaid 

explosion, either—that are enrolled fraudulently, or enrolled 

through woodworking, or enrolled through the new expansion are 

going to kill the States. 

Madam Secretary, when Amazon.com records a book sold, they 

record a book sold by based upon someone who has paid for it, not 

what is in their shopping cart, and not what is on their wish list. 

So our concern is this 364,000 number is fraudulent, because it is 

not those who have purchased plans yet. And so I would ask that 

when you return, that you give us actually who has purchased 

plans. Do you understand our frustration with that? 

Ms. SEBELIUS. Sir, as you well know, we did not take over the 

private insurance market. People will purchase plans. 

Mr. SHIMKUS. But you are telling us that those who—just shop 

are enrolled. 

Ms. SEBELIUS. I told you, sir, who is enrolled. 

43 

Mr. SHIMKUS. OK, that is why we are frustrated, because we just 

don’t get the truth out of you. 

Ms. SEBELIUS. This isn’t Medicare, and we don’t have to enroll 

in a government plan. 

Mr. SHIMKUS. Let me go to my next question. Let me go to the 

next question. I had my phone on, and when my phone rang, I left 

it on because I wanted to talk to a Democrat State Senator from 

my State of Illinois, who is on the insurance commission. And he 

said, and I quote, ‘‘Mandated preventive services are laid directly 

on premium prices.’’ Now, so it is—you cannot say, as you had numerous times, that these preventative care services are ‘‘free of 

charge,’’ can you? 

Ms. SEBELIUS. They are free to the consumer, yes, sir. 

Mr. SHIMKUS. There is no free lunch, Madam Secretary. If the 

premium is increased because of the mandated coverage based 

upon a State Senator from the State of Illinois, a Democrat, who 

is in oversight of the insurance of the State of Illinois, and he says, 

when you mandate coverage, it is rolled directly on premiums. As 

premiums increase, that is paying for these services. You cannot 

say that these are free of charge. 

Ms. SEBELIUS. Again, consumers will not have a copay or deductible. And I think that—— 

Mr. SHIMKUS. Will you admit they will have a higher premium? 

Ms. SEBELIUS. Sir, no, I do not. I think what a lot of actuaries—— 

Mr. SHIMKUS. OK, all right. 

Ms. SEBELIUS [continuing]. Will tell you is if you have preventive 

care, and prevent a more costly hospital stay, cancer episode, down 

the line, that actually lowers the premium. It doesn’t raise it. 

Mr. SHIMKUS. All right, I got it. We are just going to agree to 

disagree. It is like talking to the Republic of Korea or something. 

Last question. 

Ms. SCHAKOWSKY. Mr. Chairman, you have to let—— 

Mr. PALLONE. Mr. Chairman, you have to let—we said in the beginning—— 

Mr. SHIMKUS. I do not have to—— 

Mr. PALLONE. We said we were going to let the Secretary answer 

the question. 

Mr. SHIMKUS. The gentleman controls the time. If the Democrats 

want to yield some time—— 

Mr. PALLONE. I know, but you have to leave her the opportunity 

to answer the question. 

Mr. SHIMKUS. I do not have to allow her—— 

Mr. PALLONE. Yes, you do. We all agreed on that at the beginning. You have to allow the Secretary answer the question. 

Mr. MURPHY. The gentleman will suspend. The gentleman will 

suspend. Give the Secretary time to answer questions. 

Mr. SHIMKUS. Last question. Madam Secretary. Through the 

great work of Congressman Chris Smith, we know that of 112 

plans offered to congressional employees, and Members, only nine 

offer—nine policies exclude abortion coverage, and I have his flier 

that he handed out to us. 

Madam Secretary, you promised last time you were here, that 

you would provide me a National list of those who cover and those 

44 

who do not cover abortion and abortion services. We have yet to receive that list. Now, folks are shopping now, and I will tell you, 

when we went through this last time, we received a call from my 

office, from someone in the country, who was pro-abortion thanking 

me for that question, because they want to know. We need that 

list, Madam Secretary, and if they are shopping today, we need 

that list today. When will you provide that? 

Ms. SEBELIUS. Sir, every plan lists planned benefits and the one 

plan benefit that they must list by law is abortion services. So as 

a shopper goes on, I would highly recommend that they look in the 

plan benefit section. Check for the coverage they are interested in. 

Mr. SHIMKUS. OK, the last time I was here I held up numerous 

policies that were not explaining that. In essence, you promised to 

provide the list of those insurance plans. All we are asking is for 

you to keep your promise. 

Ms. SEBELIUS. It is the summary of benefits and plans. I guess 

we could go on—— 

Mr. SHIMKUS. Will you provide us a list? 

Ms. SEBELIUS. I will ask the—— 

Mr. SHIMKUS. You promised the last time. 

Ms. SEBELIUS. Sir, it is on the Web site. 

Mr. SHIMKUS. Will you promise—if it is on the Web site, can you 

provide it? 

Ms. SEBELIUS. It is available. 

VOICE. Regular order. 

Mr. MURPHY. Madam Secretary, were you going to answer the 

gentleman’s previous question? 

Ms. SEBELIUS. Pardon? 

Mr. MURPHY. Were you able to completely answer the question 

that the gentleman asked prior? 

Ms. SEBELIUS. I assume so. 

Mr. MURPHY. OK, thank you. Mr. Green of Texas is recognized 

for 5 minutes. 

Mr. GREEN. Thank you, Mr. Chairman. Madam Secretary, thank 

you for being here and taking time to testifying. First of all, let me 

give a little history lesson. And I know my colleagues are upset 

that this bill was passed at night, the Affordable Care Act in 2010. 

I was here in 2003, and the prescription drug plan did also not 

allow amendments on the floor of the House, and I remember walking out of the front of the Capitol and seeing the sun rise from the 

east that morning on a prescription drug plan. So we were there 

all night. So you can dislike the law, but you can’t say because it 

was passed at night or that there were no amendments on the 

floor, you did the same thing as the majority and that is not uncommon for comprehensive bills that we have on the floor. 

Mr. BURGESS. Will the gentleman yield? 

Mr. GREEN. No, I won’t yield. I only have 5 minutes. The other 

issue is, the reason that the administration is not covered on the 

exchanges, any employer, or employee who has employer-based insurance, doesn’t need to go to the exchanges. Now, Members of 

Congress are the exception of our own doing. It was part of the bill 

that came from the Senate. And believe me, I disagree with a lot 

of the things that the Senate put in that bill, and I know my rankVerDate Mar 15 2010 09:21 Sep 30, 2014 Jkt 037690 PO 00000 Frm 00048 Fmt 6602 Sfmt 6602 F:\113-108 PPACA FAILURES OK TO PRINT\113-108 PPACA FAILURES PDF MADE WA
45 

ing member and I both have some issues with the way the law is 

now and we would like to change it. 

But the House bill, we had hours and hours of amendments in 

this committee. I had 30 amendments on my own, and a number 

of them were bipartisan that were adopted by voice vote. So our 

committee had plenty of time to debate this bill. We did that to 

prescription drug plan, too, because I was here in 2003. We had a 

lot of committee amendments, but not out on the floor, and we 

didn’t have one on the floor either. But let me get to my questions. 

First of all, since the launch of the exchange on October 1st and 

problems with HealthCare.gov Web site are glaring and unacceptable, and I know you took responsibility for it along with the President. I am pleased that we have seen a great deal of progress made 

since then, and I hope that we continue to see success in the area, 

and that the Affordable Care Act can deliver on its promise to 

make coverage available and affordable to Americans who are 

stuck with unfair and unstable individual market health care, the 

insurance market. But that market is still available even though 

in a lot of cases that is why the Affordable Care Act was needed. 

It was broken. What fixes are still need to be made to make the 

experience of purchasing health care on HealthCare.gov easier for 

consumers? 

Is this an onward process that you are learning every day, I 

hope? Because in business, we learned every day that fix—serve 

our customers. 

Ms. SEBELIUS. We are definitely learning every day, Congressman, and I would say since I was here last, the greatly improved 

anonymous shopper feature is on. We just added today, the automated Medicaid transfers recognizing that some States are not able 

to accept them in an automated fashion, so we will do both. We 

have added Cuidado de Salud which is the Spanish version of the 

Web site experience that rolled out last week. 

We are in the process, as I said, of building the financial management, but each and every day we learn something from consumer experience. It is a process where each week we are adding 

fixes, identifying problems, and will continue to do that. This is a 

first-of-a-kind product, and we are going to continue to make the 

experience more smooth for consumers. 

Mr. GREEN. Well, and it is important for the Web site to work. 

Because in the middle of November we had an event in Houston 

where we had 800 people show up on a Saturday morning, and we 

used paper applications. That is my next question. The 400 or so 

people who filled out those paper applications in that 4 hours on 

a Saturday morning, how are they being dealt with through the exchanges? 

Ms. SEBELIUS. Well, sir, we have a number of people who used 

paper applications early on or PDF applications, and we are recontacting each and every one of those people, offering them either 

somebody to help them walk through the Web experience, or inviting them to do it themselves so that is very much underway on a 

casework basis. We want to make sure that anybody who filled out 

a paper app is actually welcomed in the system and gets through 

the process by the 23rd if they want coverage January 1st. 

46 

Mr. GREEN. Well, I think it is interesting though, because my colleagues objected to the marketplace. But you know, the marketplace was actually a compromise in the Senate. You know, the 

House bill that passed did not—we had an exchange, but it was 

separate because we also a public option on that exchange. So it 

is only market-based. And when I went on to buy our insurance, 

and I agree with my colleagues, my insurance has gone up. Like 

you, I am over 65. And you rate wife and I, we are going to pay 

higher premiums. We did have trouble even through the one for 

the Members of Congress. But most of the people in our country 

are not going to deal with the exchange because if their employer 

continues to provide their coverage, they don’t have to worry about 

this. And I can also say that I have had dozens and dozens of seniors because of all of the misinformation out there, who are confused, who have Medicare. And say, I am concerned about my 

Medicare. Well, Medicare has only been benefited by the Affordable 

Care Act. And again, thank you for your time. 

Mr. MURPHY. The gentleman’s time is expired. I now recognize 

myself for 5 minutes. First of all, Madam Secretary, thank you for 

being here, and I also want to thank you for getting the mental 

health parity regulations done. Those are very important and you 

put a lot of work into it. Thank you. And there is more work we 

all have to do on mental health issues, and I would welcome an opportunity to meet with a number of us to talk about some of the 

things we need to do to help mental health in America. And I appreciate your dedication to this. I also want to thank you for this 

analysis. It is helpful for us to really see some breakdowns of what 

is taking place with regard to the States and the marketplace. I 

want to ask some clarifying questions to see if you know or if you 

can find out on this. 

Of those who have signed up, you have a list of those who signed 

up for Medicaid and CHIP marketplace. Do we know how many 

were previously eligible for Medicaid? Not those that were added 

on who were previously eligible. Do we know that number? 

Ms. SEBELIUS. Sir, I don’t know those numbers and we are trying 

to get those numbers at the State level. Again, we know that a lot 

of people even in non-expansion States have come forward and now 

are presenting themselves as Medicaid eligible. But how—what is 

the old rules and what are the new rules, we are getting that number from the States. 

Mr. MURPHY. Will you be able to find out that amount? So we 

had the previous level and now it is up to 133 percent of income 

or whatever it is in various States. It would be nice to know how 

many were previously eligible and just never signed up. 

Ms. SEBELIUS. Right. 

Mr. MURPHY. And how many are newly eligible and signed up. 

Thank you, if you can get us that information. 

Ms. SEBELIUS. Yes. 

Mr. MURPHY. Also, in terms of the analysis of the data which is 

very important, of those who have—— 

Ms. SEBELIUS. Sir, and I am sorry, can I interrupt one second? 

Mr. MURPHY. Yes. 

47 

Ms. SEBELIUS. There is actually a third category. We know that 

there are people who are currently enrolled in Medicaid who are 

sort of reenrolling. 

Mr. MURPHY. Yes. Yes. 

Ms. SEBELIUS. So they are not new to either category, but they 

actually are renewing. 

Mr. MURPHY. Precisely, yes. We would like to know that. 

Ms. SEBELIUS. And they are part of that, to look at that threeway breakdown. 

Mr. MURPHY. The renews previously eligible but didn’t sign up 

and newly eligible. Thank you. 

Ms. SEBELIUS. Yes. 

Mr. MURPHY. Also, of those who have gone to the marketplace, 

the Federal and State marketplace but are not Medicaid, how 

many were previously uninsured but are now covered? Let me roll 

these out. How many were insured but had a plan canceled so they 

are covered? Do we have that kind of information? Is that things 

that we are able to get? 

Ms. SEBELIUS. We may be able to get some of that from the insurance companies. We would not collect that specific information, 

sir. 

Mr. MURPHY. And people are talking about whether or not the 

policy cost them less or more. Obviously, it is critically important 

to have the facts on this. Is there a way that your office, or is there 

anything built in where we can actually find out how many people 

are paying more, how many people are paying less? 

Ms. SEBELIUS. Again, we will rely on companies because we are 

talking about formerly insured to—— 

Mr. MURPHY. They may switch a plan. 

Ms. SEBELIUS. They may switch a plan. They may have paid 

something, but that is really going to be company data, not data 

that we would have. No one newly insured would have that comparison so it is—- 

Mr. MURPHY. We have heard different opinions and it would be 

great if we had facts on this so that would be helpful. And of the 

demographics, when I talked to some people who were insurance 

brokers or agents, they are describing that many of those who are 

signing up are people who may have had some health problems, 

have seen some high costs already, and they are going to the marketplace to find some of the cost. And there is also groups who may 

be healthy, and they are seeing some price changes there, too. Obviously, if the health care—if the Affordable Care Act was designed 

to help those sign up who are not able to afford health insurance 

before, or who are having difficulty because they had some illness, 

will we have breakdowns based upon those factors? 

Ms. SEBELIUS. Again, we will be able to tell you hopefully in the 

not too distant future, demographic breakdowns. Because we don’t 

collect personal health information from anyone because there is no 

longer a preexisting condition, nobody is medically underwritten 

anymore which everybody was in the individual market. We won’t 

be able to tell you who of the population is sick, or not sick. 

Mr. MURPHY. The next item is the question on the questionnaire, 

the Federal questionnaire which asks people if they have a condition of a disability or mental health problem, or emotional problem. 

48 

I guess we could look at that data if people would check that box 

it would tell us something. 

Ms. SEBELIUS. For Medicaid eligibility, sir, there is a, I think a 

question on pregnancy, and a question on disability. 

Mr. MURPHY. Yes, yes. 

Ms. SEBELIUS. And those are the only two questions because that 

may qualify someone of a different income category for Medicaid. 

So those are the only two, I think, health information that is collected, but we don’t have personal health information collected. 

Mr. MURPHY. OK, we will need to get those facts. You had mentioned you asked McKinsey about the readiness of the exchange for 

the October 1 launch. Did the White House encourage you to ask 

this, or was that a decision you made on your own? 

Ms. SEBELIUS. We made the decision going forward. 

Mr. MURPHY. And why was that? 

Ms. SEBELIUS. I think it is prudent to invite people who have not 

been directly involved with building a product to take a look at 

their—get their assessment on how things are going, what the 

problems are, and do it enough in advance that hopefully you can 

take their advice. 

Mr. MURPHY. I would love to know from you and follow up with 

you, what changed because of that report. Let me ask this: The 

President said that if people have suggestions to improve what is 

going on, he would like to know. I am wondering, you have been 

immersed in this for quite a while. Are there some recommendations you have for Congress of what we need to do to take care of 

some of the problems we are facing? 

Ms. SEBELIUS. Well, I certainly think that we will know a lot as 

we complete this first year of open enrollment. I would love the opportunity to come in and discuss those with this committee and 

others. We are—this is, as you know, the final phase of the 3.5- 

year implementation that has been underway, and I would say that 

we know a lot about young adults that we didn’t know then. We 

know a lot about some of the preventive care issues. As you say, 

mental health is going to be a part of this. So I think we will have 

a list to actually share with you, and we would love to work in a 

bipartisan fashion to actually fix the bill. 

There is no question that a brand-new bill, you know, will take 

some amendments and hopefully move forward, but I would welcome that opportunity. 

Mr. MURPHY. Thank you. My time is expired. I now recognize the 

gentlelady from Florida, Mrs. Castor for 5 minutes. 

Ms. CASTOR. Thank you, Mr. Chairman. And Secretary Sebelius, 

I am very pleased to see all of the progress that is being made with 

HealthCare.gov. Reports from consumers, and recent enrollment 

numbers suggest that individuals using the Web site to obtain 

quality affordable health insurance are having a much smoother 

and more successful experience. Thank goodness. 

Reading over the statistics from the new report, I was very surprised that the State of Florida is leading enrollment out of all of 

the States on the Federally-run exchanges because we have had so 

many political roadblocks. There has been so much misinformation. 

This is good news for Floridians and it makes me wonder what if 

the Web site had been working great right off the bat? These would 

49 

probably be doubled. So I know families and individuals have more 

time. We really want to push over the next few weeks, but you said 

they have 3.5 months? 

Ms. SEBELIUS. That is correct, Congresswoman, and as you know, 

because you have been a key part of this, I think the assistance of 

not only key Members of the congressional delegations throughout 

Florida, but mayors, civic leaders, health care providers, navigators, assisters are stepping up and really getting information to 

people who desperately need it. Florida has one of the highest 

numbers of uninsured Americans in the country, and clearly, people are eager for information and welcome the opportunity to make 

some choices for themselves and their families that they have 

never had before. 

Ms. CASTOR. In fact, I had one report yesterday that a local enrollment fair at a church, they signed up 50 individuals on Sunday. 

And then I have this email from the Tampa Family Health Centers, the two stories. Juana Rodriguez, a 63-year-old woman who 

has been without health insurance for 3 years stated: What a blessing to finally have insurance. She said this with a smile and replied how she was finally able to afford her medications for a preexisting condition. Her tax credit is $530, and she purchased insurance for just $35 a month. And then Robert Welch, a 29-year old 

single young man who had no insurance for the past few years. He 

works for a small business, and his employer was not able to afford 

private insurance. He was able to get a tax credit for $2,200. And 

his premium is $28. He was extremely pleased, and agreed to share 

his story, but he said he was too shy to speak in public. So Robert. 

We are sharing your story today, and I am grateful that now we 

can replicate his good-news story. But we have a long way to go. 

Now, on his small business question, it—we are all a little bit 

disappointed that the shop, the small business Web site is not 

going to be up and running as early as we would have liked, but 

does that affect the tax credits that are available for small business 

owners, those tax credits that encourage small businesses to provide health insurance, or to help make it more affordable for their 

employees? 

Ms. SEBELIUS. No, Congresswoman, it will not impact that. As 

you know, we had earlier suggested that at the Federal level, and 

this is different in some of the States, but at the Federal level, year 

one we would not be able to aggregate premiums and give employees of businesses under 50 a choice. That will happen in 2014. The 

tax credits are very much in place. We have, again, a process 

where we are working with agents and brokers which is a way that 

small business owners have gotten coverage traditionally. 

Ms. CASTOR. And their accountants, because some are not very 

sophisticated. There are three or four employees, especially in a 

tourism field State. You know, a lot of restaurant owners. 

Ms. SEBELIUS. But the tax credit this year will go to a 50 percent 

tax credit for eligible employers. It is a tax credit that did not exist 

before the Affordable Care Act. It has been at 35 percent. It rises 

to 50 percent, and we will absolutely be enrolling. We have thousands of applications for shops. We are working to get folks enrolled and shop is different than the individual market where business owners have a 12-month enrollment period because of the timVerDate Mar 15 2010 09:21 Sep 30, 2014 Jkt 037690 PO 00000 Frm 00053 Fmt 6602 Sfmt 6602 F:\113-108 PPACA FAILURES OK TO PRINT\113-108 PPACA FAILURES PDF MADE WA
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ing of plans, so shop owners, or small business owners will be able 

to enroll each and every month as their employee insurance comes 

up for renewal. 

Ms. CASTOR. OK, and then they file for the tax credit when they 

file for their—— 

Ms. SEBELIUS. That is correct. In 2015, they would be eligible for 

that. 

Ms. CASTOR. So planning now, if you are a small business owner 

looking into that, because I don’t think that many small businesses 

understand that a very robust tax credit that is growing from 35 

percent to 50 percent, might make a huge difference. 

Ms. SEBELIUS. And the Small Business Administration has been 

a terrific partner in that effort. They are using their channels to 

do a lot of outreach and education. 

Ms. CASTOR. Thank you very much. 

Mr. PITTS [presiding]. Thank you, Madam Secretary. 

The Chair now recognizes the gentleman from New Jersey, Mr. 

Lance, 5 minutes for questions. 

Mr. LANCE. Thank you very much, Mr. Chairman. Good morning 

to you, Madam Secretary. 

Ms. SEBELIUS. Good morning. 

Mr. LANCE. My questioning will be in two parts. First, regarding 

the rule of law, and second, regarding the Medicaid expansion. Regarding the rule of law, I will be going into an exchange, if that 

is how I read the statute, even though I didn’t vote for it, and hope 

that it is replaced, and those who work with me in our office will 

be going into the exchange. And I would urge other Members, for 

example, Senator Reid, that as I read the statute, that is the rule 

of law. 

In answer to Ranking Member Waxman, you indicated, and I 

certainly agree with this, that the President decided on the transition policy even though the statute, as I read it, has requirements 

that begin on January 1st, 2014. 

From your perspective, Madam Secretary, what is the statutory 

authority for the President to have announced the transition policy? 

Ms. SEBELIUS. Sir, I think the statutory authority is the enforcement discretion which is available under the law to us, and the 

President has asked us to use our enforcement discretion to not 

pursue penalties against insurers who would voluntarily decide to 

allow a transition of individuals in a market plan to continue in 

that market plan. This defers to State regulators. They get the first 

call because they regulate the marketplace, and then insurers, 

there is no mandate to insurers. It is voluntary, but it allows them 

to take up that option. 

Mr. LANCE. Thank you. So from your perspective, the ability of 

the President to do that is based upon enforcement discretion. I respectfully disagree with that. Thank you for answering the question. 

Number two, and Mr. Barton did raise this, as I read the statute, 

there are subsidies for State exchanges, but not subsidies for the 

Federal exchange, and I presume that that was placed into the 

statute to encourage States to have their own exchanges; a carrotand-stick approach. From your perspective, Madam Secretary, 

51 

what is the statutory authority for permitting subsidies for the 

Federal exchange? 

Ms. SEBELIUS. Again, sir, I am not a lawyer, and I would defer 

to the Department of Justice for the statutory authority. I think 

the framework is that I am mandated by statute to pay the subsidies, and that I think the interpretation is both by the OMB, 

which is sort of the appropriation leader on this, and the Department of Justice that the authority is consented to even though it 

is not explicitly spelled out. But again, I am not the lawyer. I 

would defer to them. 

Mr. LANCE. Thank you. Let me state, it is my legal position that 

the courts will rule against the administration in this regard, and 

obviously, this is now before the courts. In the 3.5 years since the 

ACA’s passage, has the President ever proposed a legislative 

change to any aspect of the law? 

Ms. SEBELIUS. Sir, I am trying to refresh my memory. I cannot 

answer that question, but I will—— 

Mr. LANCE. Certainly. 

Ms. SEBELIUS [continuing]. Come back with an answer. 

Mr. LANCE. It is my understanding that the President has never 

asked for any statutory change whatever, and he has made—— 

Ms. SEBELIUS. Well, I can tell you one that I do recall that I 

think has been in his proposals. We do have a provision involving 

State waivers of Medicaid expansion and then into the marketplace 

that is timed to start at 2017. He has suggested, and I think it is 

part of our budget proposal, that there actually—that date be accelerated so that States would have full authority. There are other 

provisions I think in our budget plan, not necessarily pieces of legislation, but coming through that way that we could get you enumerated. 

Mr. LANCE. Thank you. And then finally regarding the Medicaid 

matter, I have great concerns that many who have signed regarding Medicaid expansion were eligible before, and I know you are 

not able to provide those figures today, but I would like, at an opportunity that is convenient for you, Madam Secretary, to have 

those figures because it is my belief that quite a few are—were already Medicaid eligible, and are not based upon the new law. 

Mr. PITTS. The gentleman’s time is expired. The Chair now recognizes the gentleman from Maryland, Mr. Sarbanes, 5 minutes. 

Mr. SARBANES. Thank you, Mr. Chairman. I thank you Madam 

Secretary, for being here. You have been very stoic in the face of 

a lot of adversity over the last few weeks. You have accepted responsibility for which you, yourself, characterize as a failure in the 

launch of the Web site, but have obviously been aggressive in trying to improve the situation. The evidence that you presented today 

suggests that things are on the mend, and a lot more Americans 

are being able to access the government Web site which is the portal to affordable health care for them. 

I think if you step back, the bigger story here is just there were 

previously millions of Americans who were essentially trapped in 

a world where they could not access health care. There was literally no options available to them. If they had a preexisting condition, even the substandard plans that were offered in individual 

market often did not provide any option for them. 

52 

So they didn’t even have the opportunity to complain or face the 

challenges that now some of them are facing. But the fact that they 

are trying to access an option of affordable care, and yes, encountering some difficulties in having to push through those, et cetera, 

even that is progress, because before they didn’t even have that 

chance. But I think it is important for us to keep that in perspective, and that is why, I think you said earlier, I heard someone say 

that, or maybe it was Chairman Waxman, that one of the common 

emotional responses for people when they actually can enroll is 

they break down in tears, because of their years of pent-up frustration, and not being able to access affordable care. 

Ms. SEBELIUS. Well, Congressman, we know that again, in the 

individual market, which is the market that the new marketplaces 

are addressing, a large number—national studies show that it 

could be as many as 25 percent of people who tried to buy a plan 

were turned down totally. So no plan, at no price. 

Mr. SARBANES. OK, right. 

Ms. SEBELIUS. And then you have people who were individually 

medically underwritten, virtually everyone in the marketplace. And 

that is very beneficial if you are healthy and don’t have any likelihood of a preexisting condition, and typically, if you are male. It 

is not very beneficial if you are not. And if you get sick along the 

way, or if you are diagnosed, you could be, again, medically underwritten going forward to eliminate the condition that you need the 

care for. 

Mr. SARBANES. Right. 

Ms. SEBELIUS. So the choices were somewhat limited to a lot of 

people. 

Mr. SARBANES. The promise of this is to create a new normal for 

the American people where the option of getting health care is real, 

and that wasn’t the way it was before for tens of millions of Americans. 

Ms. SEBELIUS. Depending on where they worked. If you worked 

for a company, and the vast majority of large employers offered—— 

Mr. SARBANES. Then you had the access. 

Ms. SEBELIUS. And you weren’t medically underwritten and you 

weren’t penalized based on age, you were in as long as your employment. But if you worked for yourself, if you were an entrepreneur, if you were a service worker and didn’t have affordable 

coverage your options were greatly—— 

Mr. SARBANES. But even that system is going to be more rational 

going forward because as you eliminate discrimination based on 

preexisting conditions, you address the problems of portability that 

we saw before when somebody leaves one employer and goes to the 

next, those are all fixes that are going to improve the employerbased system as well. 

In terms of the challenges, obviously the launch of the Web site 

was much more difficult than was expected, but there were always 

going to be challenges. There are going to be new challenges, there 

are things, you know, you look around the corner, there are going 

to be difficulties and challenges associated with some of the payment issues that are going to happen down the line. These were 

always going to be there. There were always going to be difficulties. 

This is a major, major structural change to the health care system 

53 

which is going to improve it eventually, but we have to anticipate 

that there are going to be difficulties and we have got to soldier 

through those. That is the American ethic, right, is you take challenges and you overcome them. 

And then the last time comment I just wanted to make is I think 

one of the issues is that a lot of the people who are coming and 

finding new plans and maybe they have to pay a little bit more or 

maybe the deductible is higher in some instances, for example, but 

what they don’t compare it against is the exposure they had under 

the old plans that maybe they never had the occasion to experience 

and so that is the apples-to-apples comparison we have. 

Mr. PITTS. The gentleman’s time is expired. We have 15 minutes 

left. We have seven members still to ask questions. We will go to 

2 minutes per member. The Chair recognizes Dr. Cassidy from 

Louisiana for 2 minutes for questions. 

Mr. CASSIDY. Thank you Madam Secretary. In your answer to 

Mr. Shimkus, did you really mean to say that the Affordable Care 

Act has not resulted in increased premiums for the nonsubsidized? 

Ms. SEBELIUS. Sir, what I said is preventive care—— 

Mr. CASSIDY. No. No. Are premiums higher—— 

Ms. SEBELIUS [continuing]. Doesn’t add to the cost of premiums 

overall in terms of the long-term health care costs. That is what 

our description was. 

Mr. CASSIDY. So you are ascribing it to the preventive health 

care aspect. 

Ms. SEBELIUS. That is what he asked me, that is what I answered. 

Mr. CASSIDY. Now, Jonathan Gruber, one of the architects of this 

bill, has said that this bill is basically income redistribution. Now 

obviously though the taxes that are a trillion over 10 years but 

there is also the increased premiums people are paying for their 

policies if they are not subsidized. 

Do you have an estimate of how much increase, what is the 

amount of increased taxes people—excuse me, increased premiums 

people are paying to subsidize others on the exchange? 

Ms. SEBELIUS. No, sir, I don’t, and I think you can only talk 

about increased premiums, and I think Dr. Gruber would be one 

to suggest that if you compare like benefits to like benefits—— 

Mr. CASSIDY. Let me go on. Danny from Baton Rouge is losing 

his coverage. He says that this is my apocalypse now. The company 

I have, my family coverage went up 371 percent. Monthly premiums for a family of four from $245 a month to 913 with a $4,000 

deductible. Wow, I think Danny would like to choose his benefits 

as opposed to that. 

Many small businesses, according to your office, are going to lose 

their benefits; as many as 66 percent of employers, according to 

your analysis, will lose their grandfathered status. 

Do you think administration would support my employee Health 

Care Protection Act which would allow workers to keep their group 

health care plan they have now in 2014 and beyond? 

Ms. SEBELIUS. Sir, as you know, the snapshot is not our office estimating anything. It was a description of the turnover that existed 

prior to 2010 in the individual and small group market, those statistics that you cited. And I think in, again, the small group marVerDate Mar 15 2010 09:21 Sep 30, 2014 Jkt 037690 PO 00000 Frm 00057 Fmt 6602 Sfmt 6602 F:\113-108 PPACA FAILURES OK TO PRINT\113-108 PPACA FAILURES PDF MADE WA
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ket, there are lots of plans that are grandfathered, there are other 

plans that are offering transition in early renewals, and we are 

watching that every day. 

Mr. CASSIDY. Can I get an answer to my question? Will the administration approve the same law that is given for the individual 

that if a small business wishes to keep their policy, they would be 

allowed to do so? 

Ms. SEBELIUS. The President’s suggestion about a transitional 

policy applies to both the individual and the small group. 

Mr. CASSIDY. Beyond 2014? 

Mr. PITTS. The gentleman’s time is expired. 

The Chair recognizes Mr. Engel from New York 2 minutes for 

questions. 

Mr. ENGEL. Thank you, Mr. Chairman. I just want to say that 

New York is a good example of what is possible when the Federal 

Government has a willing and enthusiastic partner in ACA implementation. And we have set up our own exchange, we have hospitals participating in the various delivery system reform. Our 

Medicaid program is expanding. States that have fought to make 

the law work for their citizens like New York are finding success. 

Secretary Sebelius, I would like to know what your experience 

has been in States that have obstructed efforts, mainly Republican 

Governors, to implement the ACA compared to States that have 

adopted all of its measures? Are Americans experiencing an easier 

time obtaining affordable health care coverage in States that have 

their own exchange, and has the refusal of some States to expand 

Medicaid affected the rollout? 

Ms. SEBELIUS. Well, I think that, Congressman, what we are seeing every day is Governors actually considering the Medicaid expansion. Some, as you say, in New York, California, others adopted 

very early on. We were pleased yesterday that the Governor of 

Iowa indicated an interest in moving ahead on Medicaid expansion. 

That was not certain. The Governor of Pennsylvania recently also 

indicated his interest in doing the same. So we are working actively with States around the country. 

I think it is enormously difficult for consumers in States where 

there is no Medicaid expansion, they hear about the opportunity for 

affordable health coverage only to find out that they earn too less 

to qualify for a tax credit in the marketplace and really they have 

no viable option at all, and that I’m told by our navigators on the 

ground, our assisters, the people in community health centers is 

one of the worst conversations that they can have in this period. 

Mr. ENGEL. Well, we speak with the Governor of Kentucky the 

other day. And he explained to us Kentucky generally a Republican 

State, where it is working really, really well, where you have a 

Governor who is a partner who wants to see it work, it can work, 

and it should work. And I hope that more Governors would continue to do what is in the best interest of their constituents rather 

than playing political games. Thank you. 

Mr. PITTS. The Chair thanks the gentleman. I now recognize the 

gentleman from Kentucky, Mr. Guthrie. 

Mr. GUTHRIE. Thank you. You just mentioned Kentucky. Eighty 

percent of the people signing up on our exchanges are on Medicaid. 

And it has been a concern of mine, I was in State government beVerDate Mar 15 2010 09:21 Sep 30, 2014 Jkt 037690 PO 00000 Frm 00058 Fmt 6602 Sfmt 6602 F:\113-108 PPACA FAILURES OK TO PRINT\113-108 PPACA FAILURES PDF MADE WA
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fore. And Medicaid as a national program has 72 million people, 

and we are expecting an increase of 25 million over the next 10 

years. And I do believe Medicaid is important for low income children, disabled, seniors that it was designed for, but do you believe 

Medicaid should be a program of last resort or has it become just 

its own insurance program as it is now? 

Ms. SEBELIUS. Sir, first of all, I think the enrollment numbers 

are about 51 million, not 72. But also Medicaid has played I think 

a critical role for lower income Americans not only offering a wide 

range of health benefits but at a lower cost per capita than private 

insurance and that Medicare. 

Mr. GUTHRIE. I actually don’t want to be rude, but he has cut 

us down to a couple minutes so the question I want to get at 

though is your department has estimated that about 5 million 

Americans who have previously purchased insurance through their 

employer will move to Medicaid, and that is from the Office of 

OACT, the Office of Actuary, it is the number we got. And are you 

familiar with that, that we are looking at, over the next 4 years 

estimates of 5 million Americans who have employer-based insurance will move to Medicaid? 

Ms. SEBELIUS. I am not aware of that. The Office of Actuary really is an independent office, but I can check into that. 

Mr. GUTHRIE. It is a part of CMS. 

Ms. SEBELIUS. I’m not familiar with that specific number. 

Mr. GUTHRIE. That is just a concern because the estimate is it would be $20 billion in this group of people who previously purchased health insurance through their employer who will be moving into Medicaid because of the Affordable Care Act. 

The question that Chairman Upton had about income, there is 

a question with Chairman Upton about income verification and 

residency verification. I know that is up to the States to do, but the 

States who don’t expand Medicaid, the information right now, is it 

just trust the Federal Government’s numbers, right? Right now 

that is what they are being asked to do right now? 

Ms. SEBELIUS. Again, sir, we don’t enroll anyone in Medicaid. 

What we do is look at income eligibility, and based on the State 

law, send that individual’s name and the information that has been 

collected to the State. The State actually is the connection between 

the individual and Medicaid. Not the Federal Government. 

Mr. GUTHRIE. But because of timing by the January 1st, they are 

going to have to just accept it. 

Ms. SEBELIUS. Yes, and that is going on right now. The process. 

But we don’t enroll in Medicaid we just—— 

Mr. GUTHRIE. But they have to take your data. 

Mr. PITTS. The gentleman’s time has expired. Thank you, Madam 

Secretary. The Chair recognizes Mr. Griffith 2 minutes for questions. 

Mr. GRIFFITH. Thank you, Mr. Chairman. Secretary Sebelius let 

me just let you know that I agree with Representative Leonard 

Lance’s legal reasoning on the matters that he brought up earlier 

in his testimony. I do find it interesting that when we’re listening 

to my colleagues on the other side of the aisle when they talk about 

scare tactics, this is similar to what they said back in the summer 

and in September, when we were holding hearings because we 

56 

were hearing that the plan wouldn’t be ready on October 1, and so 

I am just concerned that we are going to have some of that same 

kind of thing now that we are being attacked for asking questions. 

We are just trying to get the information. And it is not that we are 

interested in scare tactics or witch hunts, it is a matter of we are 

trying to get to the bottom of a lot of these problems that we are 

concerned about out there. 

And obviously one of the tactics they said, well, this is all just 

political but you certainly have accepted responsibility and you 

don’t believe that we caused the problems with the Web site, therefore making the public distrust it, isn’t that correct? 

Ms. SEBELIUS. I do not believe you caused the problems with the 

Web site, sir. 

Mr. GRIFFITH. Thank you. Some of my colleagues implied maybe 

not that you, but somehow we are responsible for all of that distrust out there and I don’t think that is accurate. 

Also I don’t believe that the Federal Employee Health Benefit 

plan is a skimpy plan. Some of the folks said that the reason that 

costs were going up is that people had skimpy plans. Well, I was 

previously on the Federal Employee Health Benefit plan, and my 

family is facing 117 percent increase out of our pocket, that is out 

of our pocket increase, to go on to the exchange here in DC, and 

so you don’t think the plan you have is skimpy do you? 

Ms. SEBELIUS. No, sir, I don’t but as you know—— 

Mr. GRIFFITH. And you prefer to stay on that plan, don’t you? 

Ms. SEBELIUS. The new marketplace plan have some age rating 

that the Federal Employee Health Benefit program did not so you 

are going to see younger employees paying a lot less and older employees paying more. 

Mr. GRIFFITH. That is one of the reasons—I’m running out of 

time. Let me say this, too, in regard to Medicaid. One of the problems that you are having is you are sending people to the States 

based on income alone. And in Virginia, most States they have an 

asset amount. In Virginia, it is only $2,000. So they may have sufficient income to—they may not have enough income but they qualify for Medicaid under income, but they don’t qualify for Medicaid 

because they own a house. And I asked some experts on this previously and they said they have to choose whether they want their 

asset or whether they want the Medicaid. 

Ms. SEBELIUS. Again, the State law and the State Medicaid enrollment officials will make the determination of whether that individual will be enrolled. When they present at the marketplace, 

based on 133 percent or less and in Virginia right now it would be 

based on a lot less because Virginia has not raised their Medicaid 

eligibility. 

Mr. PITTS. Thank you, Madam Secretary. 

Ms. SEBELIUS. We would make a determination and refer that 

name, and they make that—— 

Mr. PITTS. The Chair recognizes the gentleman from Georgia, Dr. 

Gingrey, 2 minutes. 

Mr. GINGREY. Madam Secretary, I want to begin the question 

about the Medicaid program. My Governor, Nathan Deal of Georgia 

particularly wants an answer to this question and I am sure all the 

other 49 Governors would too. The American Affordable Care Act 

57 

force States, they force States to retain the eligibility requirements 

of Medicaid through the maintenance of effort provision going back 

to 2009. 

With the expiration of these provisions, States will finally have 

the flexibility to tailor their Medicaid program to best address the 

health care needs of their Medicaid populations. 

Now, this is the question. Will the Medicaid MOE, maintenance 

about to expire, for all States beginning on January 1, 2014? 

Ms. SEBELIUS. Yes, sir. 

Mr. GINGREY. Thank you. Madam Secretary, I want to ask you 

real quickly. In regard to eHealth plans, this company, Californiabased company, I think, 10 years old, we talked about it earlier in 

the discussion, I think they spent about $100 million developing 

their program allowing people to go onto their Web site and find 

plans, and yet we spent seven times that much reinventing the 

wheel. 

Can you tell me why we didn’t just use that technology or maybe 

some other Silicon Valley company to have a public-private partnership rather than starting over from scratch? And who made 

that decision? 

Ms. SEBELIUS. Well, sir, I would tell you that while there are 

some comparisons with the eHealth situation, there are a number 

of features very different in the Federal Web site that were required eHealth doesn’t determine citizenship eligibility, it doesn’t 

identify the Social Security number. It doesn’t—— 

Mr. GINGREY. But did you make that decision or was that made 

by someone else? 

Ms. SEBELIUS. What decision, sir? 

Mr. GINGREY. The decision to start over from scratch. 

Ms. SEBELIUS. Well, I don’t think they did start over from 

scratch. They actually, I think, along the way, adopted a number 

of the known technologies that were in place—— 

Mr. GINGREY. Let me ask you finally, I don’t want to run out of 

time, how many times did you actually visit with the President 

since 2009 or 2010 when you came on board? How many personal 

visits did you have with him at the White House regarding the Affordable Care Act? 

Ms. SEBELIUS. A lot. 

Mr. GINGREY. Can you verify that? 

Ms. SEBELIUS. Yes. 

Mr. PITTS. The gentleman’s time is expired. The Chair now recognizes the gentleman from Florida, Mr. Bilirakis, 2 minutes for 

questioning. 

Mr. BILIRAKIS. Thank you, Mr. Chairman, I appreciate it. Thanks 

for holding this hearing. 

Madam Secretary, in a proposed rule in November, CMS announced that they were considering increasing payments to insurance companies with sicker than average customers through the 

risk corridor program under section 1342 of the ACA. This program 

is supposed to be financed by insurance companies participating in 

the Exchange, but the proposal appears to put taxpayers on the 

hook. Specifically the rule states that, and I quote, ‘‘This proposed 

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ments that the Federal Government will make ,,, [and] reduce the 

amount of risk corridors receipts ...’’ 

Did you, Madam Secretary, estimate how much more money taxpayers would have to pay to insurance companies under this proposed rule? 

Ms. SEBELIUS. Sir, the risk corridor has always been a part of the 

Affordable Care Act and was anticipated for the first couple of 

years to be used for reinsurance and risk corridors for the new 

marketplaces. So we did put out a proposed rule. We talked about 

the fact that we would look carefully at what the enrollment is at 

the end of 2014 in order to determine going forward. 

Mr. BILIRAKIS. Madam Secretary, did you estimate how much 

money—— 

Ms. SEBELIUS. We won’t know anything about what that risk corridor looks like until we get more enrollment numbers. 

Mr. BILIRAKIS. OK. The rule says, and I quote, ‘‘We cannot estimate the magnitude of this impact on aggregate risk corridors payments and charges at this time.’’ I would like to get to the next 

question. 

Do you think it is responsible to put taxpayers on the hook for 

insurance companies’ losses in the Exchange? Do you think it is responsible to make these payments without even estimating the 

cost? 

Ms. SEBELIUS. Again, sir, it will be based on what the risk pool 

looks like. We always knew that in the first couple of years, the 

market would be attracting some customers and not attracting others and that there would be some risk in what we are hopeful for 

as the Affordable Care Act continues into maturity is that we have 

mature pools. We knew the first years would need this kind of risk 

adjustment. 

Mr. PITTS. The Chair thanks the gentlelady and now recognizes 

Mrs. Ellmers, 2 minutes for questions. 

Mrs. ELLMERS. Thank you Mr. Chairman. Thank you, Madam 

Secretary, for being with us. 

I have some specific questions to ask about some of the—essentially the promises that the President made to the American people 

as he was rolling out the idea of the Affordable Care Act. One of 

those promises being, if you like your doctor, you can keep your 

doctor, period. 

Can you commit to the American people today that this is true 

and that they will be able to keep their doctor? 

Ms. SEBELIUS. Congresswoman, I think that, as you well know, 

in the private market, networks change on a constant basis. The 

President is not overtaking the private health insurance market. 

There is—— 

Mrs. ELLMERS. You are absolutely right, but the promise that 

was made to the American people so that this piece of legislation, 

which is now law, was passed was that they would be able to keep 

their doctor, yes or no? 

Ms. SEBELIUS. Again, most consumers will have the opportunity 

to pick and choose a network that continues their doctor. There is 

nothing in the law that has their doctor lost to them. 

59 

Mrs. ELLMERS. There is nothing in the law. But there are networks that are now very narrowed as a result of the law, is that 

not true? 

Ms. SEBELIUS. Insurance companies make network decisions day 

in and day out. Any insurance company—— 

Mrs. ELLMERS. That is not the promise that the President made. 

Did the President not make that promise to the American people? 

Ms. SEBELIUS. This is the private insurance market that changes 

networks on basically a daily basis. 

Mrs. ELLMERS. Then why in the world, Madam Secretary, did the 

President make that promise to the American people? 

Ms. SEBELIUS. I think the President was trying to assure people 

that the law did not require them to lose their doctor. They have 

a network to choose from—— 

Mrs. ELLMERS. No, I don’t believe that he was reassuring the 

American people that they would not lose their doctor. I think he 

was reassuring the American people that if this law passed, that 

they would be able to keep their doctor. So therefore today you are 

basically saying no, that this is not the case. 

Ms. SEBELIUS. I am saying that there is, again, this is the private insurance market where insurance companies develop networks and change them on a regular basis—— 

Mrs. ELLMERS. And the American people would be able to keep 

their doctor if they pay more, according to Ezekiel Emanuel. 

Ms. SEBELIUS. They can choose a network where their doctor is 

available—— 

Mrs. ELLMERS. And pay more? 

Ms. SEBELIUS. They can choose a plan where their doctor is not 

available based on the kind of premium, the kind of deductible, the 

kind of situation they have. They have a choice. 

Mrs. ELLMERS. I see my time has expired so thank you, Madam 

Secretary. 

Mr. PITTS. The Chair thanks the gentlelady. 

That concludes our questioning at the present. Madam Secretary, 

we will have some follow-up questions we will send to you. We ask 

that you please respond promptly. 

We have a couple of unanimous consent requests. 

I would like unanimous consent to submit to the record a letter 

from Dr. Julie Welch, an emergency medicine physician and educator from Indianapolis. Without objection, so ordered. 

[The information follows:] 

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Mr. PITTS. Dr. Burgess. 

Mr. BURGESS. Thank you, Mr. Chairman. Dr. Gingrey referenced 

an offer from eHealth to the President to provide a platform for the 

market exchange, and I would like to submit his letter for the 

record, and I will make this part of a question for the record that 

I will do in follow up. 

Mr. PITTS. Without objection, so ordered. 

[The information follows:] 

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Mr. PITTS. Ranking member has a unanimous consent request. 

Mr. PALLONE. One is from my constituent in Piscataway, Anthony Wiehl, that I referenced. Another is the one that Ms. 

Schakowsky referenced. These are the different individuals impacted by the ACA. 

Mr. PITTS. Without objection. 

Mr. PALLONE. And then there is a third one from Ms. 

Schakowsky. 

Mr. PITTS. Without objection, so ordered. 

Thank you, Madam Secretary, for your patience for responding 

to all of our questions. I remind members they have 10 business 

days to submit questions for the record, and that means they 

should submit their questions by the close of business on Tuesday, 

December 31st. Another important hearing. Thank you, Madam 

Secretary, for your indulgence. Without objection, the subcommittee is adjourned. 

[Whereupon, at 12:19 p.m., the subcommittee was adjourned.] 

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