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95–578 PDF 2015

REVIEWING THE POLICIES AND 

PRIORITIES OF THE U.S. 

DEPARTMENT OF HEALTH AND 

HUMAN SERVICES 

HEARING 

BEFORE THE

COMMITTEE ON EDUCATION 

AND THE WORKFORCE 

U.S. HOUSE OF REPRESENTATIVES 

ONE HUNDRED FOURTEENTH CONGRESS 

FIRST SESSION 

HEARING HELD IN WASHINGTON, DC, JULY 28, 2015 

Serial No. 114–24 

Printed for the use of the Committee on Education and the Workforce 

( 

Available via the World Wide Web: www.gpo.gov/fdsys/browse/ 

committee.action?chamber=house&committee=education 

or 

Committee address: http://edworkforce.house.gov 

CEWDOCROOM with DISTILLER

(II) 

COMMITTEE ON EDUCATION AND THE WORKFORCE 

JOHN KLINE, Minnesota, Chairman 

Joe Wilson, South Carolina 

Virginia Foxx, North Carolina 

Duncan Hunter, California 

David P. Roe, Tennessee 

Glenn Thompson, Pennsylvania 

Tim Walberg, Michigan 

Matt Salmon, Arizona 

Brett Guthrie, Kentucky 

Todd Rokita, Indiana 

Lou Barletta, Pennsylvania 

Joseph J. Heck, Nevada 

Luke Messer, Indiana 

Bradley Byrne, Alabama 

David Brat, Virginia 

Buddy Carter, Georgia 

Michael D. Bishop, Michigan 

Glenn Grothman, Wisconsin 

Steve Russell, Oklahoma 

Carlos Curbelo, Florida 

Elise Stefanik, New York 

Rick Allen, Georgia 

Robert C. ‘‘Bobby’’ Scott, Virginia 

Ranking Member 

Rube ́n Hinojosa, Texas 

Susan A. Davis, California 

Rau ́l M. Grijalva, Arizona 

Joe Courtney, Connecticut 

Marcia L. Fudge, Ohio 

Jared Polis, Colorado 

Gregorio Kilili Camacho Sablan, 

Northern Mariana Islands 

Frederica S. Wilson, Florida 

Suzanne Bonamici, Oregon 

Mark Pocan, Wisconsin 

Mark Takano, California 

Hakeem S. Jeffries, New York 

Katherine M. Clark, Massachusetts 

Alma S. Adams, North Carolina 

Mark DeSaulnier, California 

Juliane Sullivan, Staff Director 

Denise Forte, Minority Staff Director 

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(III) 

C O N T E N T S 

Page 

Hearing held on July 28, 2015 ............................................................................... 1 

Statement of Members: 

Kline, Hon. John, Chairman, Committee on Education and the Workforce 1 

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

Scott, Hon. Robert C., Ranking Member, Committee on Education and 

the Workforce ................................................................................................ 4 

Prepared statement of ............................................................................... 6 

Statement of Witnesses: 

Burwell, Hon. Sylvia Matthews, Secretary, U.S. Department of Health 

and Human Services, Washington, DC ....................................................... 8 

Prepared statement of ............................................................................... 10 

Additional Submissions: 

Davis, Hon. Susan A., a Representative in Congress from the State of 

California: 

CBO Budgetary and Economic Effects of Repealing the Affordable 

Care Act .................................................................................................. 55 

Guthrie, Hon. Brett, a Representative in Congress from the State of 

Kentucky: 

Letter dated April 3, 2015 ........................................................................ 88 

Chairman Kline: 

Letter dated June 16, 2015 from Annette Guarisco Fildes, President 

and CEO, The ERISA Industry Committee ......................................... 32 

Letter dated June 22, 2015 from The National Coalition on Benefits .. 44 

Letter dated June 17, 2015 from Kathryn Wilber, American Benefits 

Council .................................................................................................... 39 

Letter dated June 18, 2015 from Annette Guarisco Fildes, President 

and CEO, The ERISA Industry Committee ......................................... 30 

Wilson, Hon. Frederica S., a Representative in Congress from the State 

of Florida: 

ASPE Issue Brief dated July 16, 2015 .................................................... 102 

Questions submitted for the record by: 

Allen, Hon. Rick, a Representative in Congress from the State of 

Georgia ................................................................................................... 124 

Barletta, Hon. Lou, a Representative in Congress from the State 

of Pennsylvania ...................................................................................... 124 

Foxx, Hon. Virginia, a Representative in Congress from the State 

of North Carolina ................................................................................... 123 

Fudge, Hon. Marcia L., a Representative in Congress from the State 

of Ohio .................................................................................................... 126 

Mr. Kline .................................................................................................... 122 

Polis, Hon. Jared, a Representative in Congress from the State of 

Colorado .................................................................................................. 127 

Roe, Hon. David P., a Representative in Congress from the State 

of Tennessee ........................................................................................... 123 

Mr. Scott .................................................................................................... 125 

Secretary Burwell’s response to questions submitted for the record 129 

CEWDOCROOM with DISTILLER

CEWDOCROOM with DISTILLER

(1) 

REVIEWING THE POLICIES AND PRIORITIES 

OF THE U.S. DEPARTMENT OF HEALTH 

AND HUMAN SERVICES 

Tuesday, July 28, 2015 

House of Representatives, 

Committee on Education and the Workforce, 

Washington, D.C. 

The committee met, pursuant to call, at 10:02 a.m., in Room 

2175, Rayburn House Office Building, Hon. John Kline [chairman 

of the committee] presiding. 

Present: Representatives Kline, Foxx, Roe, Thompson, Walberg, 

Salmon, Guthrie, Barletta, Messer, Brat, Carter, Bishop, 

Grothman, Russell, Curbelo, Stefanik, Allen, Scott, Hinojosa, 

Davis, Grijalva, Courtney, Polis, Wilson of Florida, Bonamici, 

Pocan, Takano, Jeffries, Clark, Adams, and DeSaulnier. 

Staff Present: Lauren Aronson, Press Secretary; Andrew 

Banducci, Professional Staff Member; Janelle Belland, Coalitions 

and Members Services Coordinator; Kathlyn Ehl, Professional Staff 

Member; James Forester, Professional Staff Member; Ed Gilroy, 

Director of Workforce Policy; Callie Harman, Staff Assistant; Christine Herman, Professional Staff Member; Tyler Hernandez, Press 

Secretary; Nancy Locke, Chief Clerk; Zachary McHenry, Legislative 

Assistant; Michelle Neblett, Professional Staff Member; Brian Newell, Communications Director; Krisann Pearce, General Counsel; 

Jenny Prescott, Professional Staff Member; Lauren Reddington, 

Deputy Press Secretary; Alissa Strawcutter, Deputy Clerk; Juliane 

Sullivan, Staff Director; Alexa Turner, Legislative Assistant; Joseph Wheeler, Professional Staff Member; Tylease Alli, Minority 

Clerk/Intern and Fellow Coordinator; Austin Barbera, Minority 

Staff Assistant; Jacque Chevalier, Minority Senior Education Policy 

Advisor; Denise Forte, Minority Staff Director; Christine Godinez, 

Minority Staff Assistant; Ashlyn Holeyfield, Minority Education 

Policy Fellow; Carolyn Hughes, Minority Senior Labor Policy Advisor; Brian Kennedy, Minority General Counsel; Veronique Pluviose, 

Minority Civil Rights Counsel; Dillon Taylor, Minority Labor Policy 

Fellow; and Arika Trim, Minority Press Secretary. 

Chairman KLINE. A quorum being present, the Committee on 

Education and the Workforce will come to order. 

Good morning, Secretary Burwell. 

Secretary BURWELL. Good morning. 

CEWDOCROOM with DISTILLER

2 

Chairman KLINE. Thank you for joining us to review the policies 

and priorities of the Department of Health and Human Services. 

As is often the case when a Cabinet Secretary appears before the 

committee, we have a lot of ground to cover in a short period of 

time. That is especially true for a Department as big, powerful, and 

costly as the Department of Health and Human Services. 

Now, the end of the current fiscal year, HHS is expected to spend approximately $1 trillion administering numerous programs affecting millions of Americans including child care, welfare, healthcare, 

and early childhood development. At a time when families are 

being squeezed by a weak economy and record debt, we have an urgent responsibility to make sure the Federal Government is operating efficiently and effectively. It is a responsibility we take seriously, which is why this hearing is important, and why we intend 

to raise a number of key issues. 

For example, we are interested to learn about the Department’s 

progress implementing recent changes to the Child Care and Development Block Grant Program. Last year, the committee helped 

champion bipartisan reform of the program to strengthen health 

and safety protections, empower parents, and improve the quality 

of care. This vital program has helped countless moms and dads 

provide for their families, and we hope the Department is on track 

to implement these changes quickly and in line with congressional 

intent. 

Another vital program for many low-income families is Head 

Start. Earlier this year, the committee outlined a number of key 

principles for strengthening the program such as reducing regulatory burdens as well as encouraging local innovation and better 

engagement with parents. The committee then solicited the public 

feedback that would help turn these principles into a legislative 

proposal. 

It was in the midst of this effort to reform the law that the Department decided to launch a regulatory restructuring of the program. Some of the Department’s proposed changes will help improve the program. However, the sheer scope and cost of the rulemaking raises concerns and has led to some uncertainty among 

providers who serve these vulnerable children. Strengthening the 

law is a better approach than transforming a program through regulatory fiat, and we urge the administration to join us in that effort. 

These two areas alone could fill up most of our time this morning, and I haven’t even mentioned services provided under the 1996 

Welfare Reform Law and the Older Americans Act. Of course, as 

you might expect, Secretary Burwell, on the minds of most members are the challenges the country continues to face because of the 

President’s healthcare law. Families, workers, employers are learning more and more about the harmful consequences of this flawed 

law. 

For example, patients have access to fewer doctors, to control 

costs. It is estimated that insurance plans on the health exchanges 

have 34 percent fewer providers than non-exchange plans, including 32 percent fewer primary care doctors and 42 percent fewer 

oncologists and cardiologists. The law is plagued by waste and 

abuse. 

CEWDOCROOM with DISTILLER

3 

In 2014, investigators with the nonpartisan Government Accountability Office used fake identities to enroll 12 individuals into 

subsidized coverage on a healthcare exchange. Just this month, 

GAO announced 11 of the 12 fake individuals are still enrolled and 

receiving taxpayer subsidies. More than 7 million individuals paid 

a penalty for failing to purchase government approved health insurance, roughly 25 percent more than the administration expected 

in the worst-case scenario. According to the Associated Press, at 

least 4.7 million individuals were notified that their insurance 

plans were canceled because they did not abide by the rigid mandates established under the healthcare law. 

The nonpartisan Congressional Budget Office estimates the law 

will result in 2.5 million fewer full-time jobs. This reflects what 

we’ve heard over and over again from employers who have no 

choice but to cut hours or delay hiring because of the law’s burdensome mandates. Healthcare costs continue to skyrocket. According 

to the New York Times, health insurance companies are seeking 

rate increases of ‘‘20 percent to 40 percent or more,’’ suggesting 

markets are still adjusting to the, ‘‘shock waves set out by the Affordable Care Act.’’ 

Finally, after all the mandates, fraud, loss of coverage, fewer 

jobs, higher costs, and nearly $2 trillion in new government spending, it is estimated more than 25 million individuals will still lack 

basic healthcare coverage. 

And yet, just last month, President Obama said the law ‘‘worked 

out better than some of us anticipated.’’ Of course, for those who 

oppose this government takeover of healthcare, this is precisely 

what we anticipated and is precisely why the American people deserve a better approach. 

In closing, Madam Secretary, I want to thank you again for joining us this morning. It is our responsibility to hold you and the administration accountable when we believe the country is moving in 

the wrong direction. However, there are areas where I believe we 

can find common ground and advance positive solutions on behalf 

of the American people. Today’s hearing is an important part of 

those efforts, and I look forward to our discussion. 

With that, I will now yield to Ranking Member Bobby Scott for 

his opening remarks. 

[The statement of Chairman Kline follows:] 

Prepared Statement of Hon. John Kline, Chairman, Committee on 

Education and the Workforce 

Good morning, Secretary Burwell. Thank you for joining us to review the policies 

and priorities of the Department of Health and Human Services. As is often the case 

when an agency secretary appears before the committee, we have a lot of ground 

to cover in a short period of time. That is especially true for an agency as big, powerful, and costly as the Department of Health and Human Services. 

By the end of the current fiscal year, HHS is expected to spend approximately 

$1 trillion administering numerous programs affecting millions of Americans, including child care, welfare, healthcare, and early childhood development. At a time 

when families are being squeezed by a weak economy and record debt, we have an 

urgent responsibility to make sure the federal government is operating efficiently 

and effectively. It is a responsibility we take seriously, which is why this hearing 

is important and why we intend to raise a number of key issues. 

For example, we are interested to learn about the department’s progress implementing recent changes to the Child Care and Development Block Grant program. 

Last year, the committee helped champion bipartisan reforms of the program to 

CEWDOCROOM with DISTILLER

4 

strengthen health and safety protections, empower parents, and improve the quality 

of care. This vital program has helped countless moms and dads provide for their 

families, and we hope the department is on track to implement these changes quickly and in line with congressional intent. 

Another vital program for many low-income families is Head Start. Earlier this 

year, the committee outlined a number of key principles for strengthening the program, such as reducing regulatory burdens, as well as encouraging local innovation 

and better engagement with parents. The committee then solicited public feedback 

that would help turn these principles into a legislative proposal. 

It was in the midst of this effort to reform the law that the department decided 

to launch a regulatory restructuring of the program. Some of the department’s proposed changes will help improve the program; however, the sheer scope and cost of 

the rulemaking raises concerns and has led to some uncertainty among providers 

who serve these vulnerable children. Strengthening the law is a better approach 

than transforming a program through regulatory fiat, and we urge the administration to join us in that effort. 

These two areas alone could fill up most of our time this morning, and I haven’t 

even mentioned services provided under the 1996 welfare reform law and the Older 

Americans Act. Of course, as you might expect, Secretary Burwell, on the minds of 

most members are the challenges the country continues to face because of the president’s healthcare law. Families, workers, and employers are learning more and 

more about the harmful consequences of this flawed law. For example: 

* Patients have access to fewer doctors. To control costs, it is estimated that insurance plans on the healthcare exchanges have 34 percent fewer providers than 

non-exchange plans, including 32 percent fewer primary care doctors and 42 percent 

fewer oncologists and cardiologists. 

* The law is plagued by waste and abuse. In 2014, investigators with the nonpartisan Government Accountability Office used fake identities to enroll 12 individuals into subsidized coverage on a healthcare exchange. Just this month, GAO announced 11 of the 12 fake individuals are still enrolled and receiving taxpayer subsidies. 

* More than seven million individuals paid a penalty for failing to purchase government-approved health insurance, roughly 25 percent more than the administration expected under the worst case scenario. 

* According to the Associated Press, at least 4.7 million individuals were notified 

that their insurance plans were cancelled because they did not abide by the rigid 

mandates established under the healthcare law. 

* The nonpartisan Congressional Budget Office estimates the law will result in 

2.5 million fewer full-time jobs. This reflects what we’ve heard over and over again 

from employers who have no choice but to cut hours or delay hiring because of the 

law’s burdensome mandates. 

* Healthcare costs continue to skyrocket. According to the New York Times, 

health insurance companies are seeking rate increases of ‘‘20 percent to 40 percent 

or more,’’ suggesting markets are still adjusting to the ‘‘shock waves set off by the 

Affordable Care Act.’’ 

Finally, after all the mandates, fraud, loss of coverage, fewer jobs, higher costs, 

and nearly $2 trillion in new government spending, it’s estimated more than 25 million individuals will still lack basic healthcare coverage. And yet, just last month, 

President Obama said the law ‘‘worked out better than some of us anticipated.’’ Of 

course, for those who opposed this government takeover of healthcare, this is precisely what we anticipated and it is precisely why the American people deserve a 

better approach. 

In closing, Secretary Burwell, I want to thank you again for joining us this morning. It is our responsibility to hold you and the administration accountable when 

we believe the country is moving in the wrong direction. However, there are areas 

where I believe we can find common ground and advance positive solutions on behalf of the American people. Today’s hearing is an important part of those efforts, 

and I look forward to our discussion. 

With that, I will now yield to Ranking Member Bobby Scott for his opening remarks. 

Mr. SCOTT. Thank you, Chairman Kline. 

And welcome, Secretary Burwell, and thank you for being with 

us today. I look forward to your testimony. 

CEWDOCROOM with DISTILLER

5 

Today we’ll hear about the President’s Fiscal Year 2016 Health 

and Human Services budget proposals and the Department’s budget priorities. While the budget was released months ago, I’m 

pleased to see that the word ‘‘priority’’ is included in the title of today’s hearing. Budgeting requires making tough choices, and a 

budget is in fact a reflection of priorities. As legislators, we decide 

what our priorities are and how best to invest in our country. 

I was pleased that the President’s budget request was reflective 

of many important priorities such as protecting access to 

healthcare insurance for all Americans, giving all children a chance 

to succeed, and reducing inequality around the country. 

In many areas, I believe that we’ve made great progress on these 

priorities. For example, the passage of the Affordable Care Act has 

given millions of Americans access to health coverage, some for the 

first time in their lives. The ACA has also helped slow the growth 

in healthcare costs, closed the doughnut holes for seniors, and encouraged and improved access to mental health services and preventive care. 

Just weeks ago the Supreme Court decided in another case pertaining to the Affordable Care Act, in King v. Burwell. The legality 

of subsidies for those obtaining health insurance through the Federal marketplace instead of a Statewide marketplace was upheld. 

The Affordable Care Act was structured and designed to improve 

healthcare insurance coverage and access across the entire country, 

and it has, and now those living in Virginia have enjoyed access 

to insurance subsidies just like someone in Minnesota, and because 

of the outcome of the case, they will continue to do so. 

I want to thank Secretary Burwell for her efforts and her Department’s hard work in implementing the ACA. I recognize the 

challenge that your agency faces in implementing the law with limited resources and unlimited attacks, but despite these challenges, 

the ACA is working. 

I was also pleased to see that the President’s budget request 

placed priority on giving all children a chance to succeed by ensuring robust funding to increase both access to and quality of early 

learning and childcare programs. 

The Republican budget adopted by the House earlier this year is 

not reflective of these shared national priorities, despite research 

showing for every dollar spent on early education, there is a return 

of $7 in reduced costs in other parts of the budget. We must invest 

in quality early learning programs because all children deserve 

being in kindergarten with the building blocks to success. 

Now, decades of research has shown that properly nurturing children in the first five years of life is instrumental in supporting enhanced brain development, cognitive functioning, and emotional 

and physical health. But all too often low-income working families 

lack access to high-quality affordable child care and early childhood 

education, and these children tend to fall far behind. In addition 

to this achievement gap, children who don’t participate in highquality early learning programs are more likely to have weaker 

educational outcomes, lower earnings, increased involvement in the 

criminal justice system, and increased teen pregnancy. 

Affordable high-quality child care is not just critical for children, 

it is also critical for working parents, because child care is a twoCEWDOCROOM with DISTILLER

6 

generational program. Parents of young children need child care to 

go to work or go to school. And a lack of stable child care is associated with job interruptions and job loss for working parents. 

Child care ought to be a national priority for America’s children 

and to help grow our economy. Just two programs throughout the 

bulk of the Federal role in early education, the Head Start program 

and the Child Care Development Block Grant. Unfortunately, because of limited funding, too few children have access. This unmet 

need continues to grow. Only four out of 10 eligible children have 

access to Head Start and only one out of six federally eligible families receive child care subsidies. We have decades of evidence that 

investing in programs like Head Start and the Child Care Development Block Grant work, and the time is to invest in these programs and ensure that we’re giving all children the chance to succeed. 

Lastly, it’s past time for Congress to raise the sequester-level discretionary spending caps that are stunting the progress that we 

can make as a Nation in important areas like health and education. These caps threaten nearly every program under the jurisdiction of this committee from low income home energy assistance 

program to the Older Americans Act and others. The sequester has 

led to woefully inadequate investment in critical National needs 

and puts us on a path to another government shutdown. 

In coming back to the idea of priorities, investing in our Nation’s 

future should be Congress’ number one priority, not corporate tax 

breaks or lowering the estate tax. Our focus should remain on restoring investments that strengthen our Nation’s middle class and 

help hard working American families get ahead. 

So thank you, Mr. Chairman, and thank you Secretary Burwell 

for being here today. 

Chairman KLINE. I thank the gentleman. 

[The statement of Mr. Scott follows:] 

Prepared Statement of Hon. Robert C. ‘‘Bobby’’ Scott, Ranking Member, 

Committee on Education and the Workforce 

Thank you Chairman Kline, and welcome Secretary Burwell. Thank you, Secretary, for being with us and I look forward to your testimony. 

Today we will hear about the President’s Fiscal Year 2016 Health and Human 

Services Budget proposal and the Department’s policy priorities. While the budget 

was released months ago, I was pleased to see the word ‘‘priority’’ included in the 

title of today’s hearing. Budgeting requires making tough choices, and a budget is 

in fact a reflection of priorities. As legislators, we decide what our priorities are and 

how to best invest in our country. I was pleased that the President’s budget request 

was reflective of the priorities that are important to the success of families and communities across the country – protecting access to health insurance for all Americans, giving all children a chance to succeed, and reducing inequality in this country. 

In many areas, I believe we have made great progress in these priorities. For example, the passage of the Affordable Care Act has given millions of Americans access to health coverage, some for the first time in their lives. The ACA has helped 

to slow the growth in healthcare costs, closed the donut hole for seniors, and has 

encouraged and improved access to mental health services and preventive care. 

Just a few weeks ago, the Supreme Court decided another case pertaining to the 

Affordable Care Act. In King v. Burwell, the legality of subsidies for those obtaining 

insurance through a federal Marketplace instead of a state-run Marketplace was 

upheld. The Affordable Care Act was structured and designed to improve health insurance coverage and access across the entire country. And it has. Those living in 

Virginia have enjoyed access to insurance subsidies, just like someone in Minnesota, 

and will continue to do so. 

CEWDOCROOM with DISTILLER

7 

I want to thank Secretary Burwell for her efforts and her Department’s hard work 

implementing the ACA. I recognize the challenge your agency faces in implementing 

this law with limited resources and unlimited attacks. Despite these challenges, the 

ACA is working. 

I was also pleased that the President’s budget request placed priority on giving 

ALL children a chance to succeed by ensuring robust funding to increase both access 

to and the quality of early learning and childcare programs. The Republican budget 

adopted in the House earlier this year is not reflective of these shared, national priorities despite research showing a return of over $7 for every $1 spent on early education. We must invest in quality early learning programs because all children deserve to enter kindergarten with the building blocks to success. 

Decades of research has shown that properly nurturing children in the first five 

years of life is instrumental to supporting enhanced brain development, cognitive 

functioning, and emotional and physical health. But all too often, low-income working families lack access to high-quality, affordable child care and early childhood 

education, and these children tend to fall behind. Beyond the 

achievement gap, children who don’t participate in high-quality early education 

programs are more likely to have weaker educational outcomes, lower earnings, and 

increased involvement in the criminal justice system. Affordable high-quality child 

care is not just critical for children, it is also critical for working parents. Child care 

is a two-generation program. Parents of young children need child care to work or 

go to school. And a lack of stable child care is associated with job interruptions and 

job loss for working parents. Child care ought to be a national priority for America’s 

children and to help grow our economy. 

Just two programs provide for the bulk of the federal role in early education: the 

Head Start Program and the Child Care and Development Block Grant. Unfortunately, because of limited federal funding, too few young children have access. This 

unmet need continues to grow – only 4 out of 10 eligible children have access to 

Head Start and only 1 out of 6 federally-eligible families receive child care subsides. 

We have decades of evidence that investing in programs like Head Start and the 

Child Care and Development Block Grant works. It is time to invest in these programs and ensure that we are giving ALL children the chance to succeed. 

Lastly, it is past time for Congress to raise the sequester-level discretionary 

spending caps that are stunting the progress we can make as a nation in important 

areas, like health and education. These caps threaten nearly every program under 

the jurisdiction of this Committee, from the Low Income Home Energy Assistance 

Program to the Older Americans Act supportive programs. The sequester has led to 

woefully inadequate investment in critical national needs and put us on a path to 

another government shutdown. And coming back to the idea of priorities, investing 

in our country’s future should be Congress’ number one priority – not corporate tax 

breaks, or lowering the estate tax. Our focus should remain on restoring investments that strengthen our nation’s middle class and help hardworking families get 

ahead. 

Thank you and Secretary Burwell, I look forward to hearing from you today. 

Chairman KLINE. Pursuant to Committee Rule 7(c), all members 

will be permitted to submit written statements to be included in 

the permanent hearing record. Without objection, the hearing 

record will remain open for 14 days to allow such statements and 

other extraneous material referenced during the hearing to be submitted for the official hearing record. 

It is now my pleasure to introduce our distinguished witness. 

The Honorable Sylvia Matthews Burwell is the Secretary of Health 

and Human Services. Prior to joining HHS in June of 2014, Secretary Burwell served as a director of the Office of Management 

and Budget, where she oversaw the development of President 

Obama’s second term management agenda. During the Clinton administration, Secretary Burwell served as deputy director of OMB, 

deputy chief of staff to the President, chief of staff to the Secretary 

of the Treasury, and staff director of the National Economic Council. 

Welcome, Madam Secretary. I will now ask the Secretary to 

stand and raise your right hand. 

CEWDOCROOM with DISTILLER

8 

Thank you. 

[Witness sworn.] 

Chairman KLINE. Let the record reflect the witness answered in 

the affirmative. 

Now, before I recognize you to provide your testimony, let me 

briefly remind you or, more importantly, my colleagues of our lighting system. We typically allow five minutes for each witness to 

present, although I will be flexible on this timeline, given you are 

our only witness and you are a Cabinet Secretary. I would ask you, 

though, to try to limit your remarks, because we have a lot of members who want to get to questions, and I will be strictly enforcing 

the five-minute rule and perhaps the four-minute rule. The Secretary has a hard stop time at 12:00. We will honor that, and I 

would ask my colleagues to be patient. 

Again, on the lights, when you start, and we’ll put the timer on, 

but you can effectively ignore it if you’d like, it will be green and 

then turn yellow when you have a minute to go and then red when 

the five-minute mark is over. And that applies only to the Secretary. To my colleagues, when five minutes is up, five minutes is 

up. 

Now, you are recognized, Madam Secretary. 

TESTIMONY OF THE HONORABLE SYLVIA MATTHEWS 

BURWELL, SECRETARY, U.S. DEPARTMENT OF HEALTH AND 

HUMAN SERVICES, WASHINGTON D.C. 

Secretary BURWELL. Thank you, Mr. Chairman and Ranking 

Member Scott, as well as members of the Committee. Thank you 

for this opportunity to discuss the President’s budget for the Department of Health and Human Services. 

I believe firmly that we all share common interests and, therefore, we have a number of opportunities to find common ground. 

We saw the power of common ground in the reauthorization of the 

Child Care and Development Block Grant Program that happened 

last fall, as well as the bipartisan SGR repeal earlier this year. And 

I appreciate all of your all’s work to get that passed. 

The President’s budget proposes to end sequestration fully, reversing it through domestic priorities in 2016, matched by equal 

dollar increases for the Department of Defense. Without further 

congressional action, sequestration will return in full in 2016, 

bringing discretionary funding to its lowest level in a decade adjusted for inflation. We need a whole of government solution, and 

I hope that both parties can work together to achieve a balanced 

and commonsense approach. 

The budget before you makes critical investments in healthcare, 

science, innovation, public health, and human services. It maintains our responsible stewardship of the taxpayers’ dollar; it 

strengthens our work together with Congress to prepare our Nation 

for key challenges at home as well as abroad. For HHS, the budget 

proposes $83.8 billion in discretionary budget authority. This 4.8 

billion increase will allow our Department to deliver impact today 

and lay a stronger foundation for the Nation for tomorrow. 

It is a fiscally responsible budget, which in tandem with accompanying legislative proposals, could save taxpayers a net estimated 

$250 billion. The budget is projected to continue slowing the 

CEWDOCROOM with DISTILLER

9 

growth in Medicare by securing $423 billion in savings as we build 

a better, smarter, healthier delivery system. 

In terms of providing all Americans with access to affordable 

quality healthcare, the budget builds on our historic progress in reducing the number of uninsured and improving coverage for families, who already have insurance. The budget supports our efforts 

to move towards a health delivery system that delivers better care, 

spends dollars in a smarter way, and puts the patient at the center 

of the care to keep them healthy. 

The budget also improves access for Native Americans. To support communities throughout the country, the budget makes critical investments in health centers and our Nation’s healthcare 

workforce, particularly in rural and other high-need areas. To advance our shared vision for leading the world in science and innovation, the budget increases NIH funding by $1 billion to advance 

biomedical and behavioral research, among other priorities. 

It also invests in precision medicine, a new cross department effort focused on development treatments, diagnostics, and prevention strategies tailored to the individual genetic characteristics of 

a patient. To further our common interests in providing Americans 

with the building blocks of healthy and productive lives, this budget outlines an ambitious plan to make affordable quality child care 

available to working and middle-class families. 

Specifically, the budget builds on important legislation passed by 

this Congress last fall to create a continuum of early learning opportunities from birth through age five. This change would provide 

high-quality preschool for every child, guaranteed quality child care 

for working families, grow the supply of early learning opportunities for young children, and expand investments in voluntary evidence-based home visiting programs. 

To keep Americans safe and healthy, the budget strengthens 

health and public infrastructure with $975 million for domestic and 

international preparedness. It also invests in behavioral health 

services including more than $99 million in new funding to combat 

prescription opioid and heroin abuse. 

Finally, as we look to leave the Department stronger, the budget 

invests in our shared priorities of addressing waste, fraud, and 

abuse—initiatives that are projected to yield $22 billion in gross 

savings. 

The budget addresses the Department’s Medicare appeals backlog with a coordinated approach. The budget also makes a significant investment in the security of the Department’s information 

technology and cybersecurity. 

I want to conclude by taking a moment to say how proud I am 

of the HHS team and the employees that work on Ebola, their 

work every day and their commitment every day. I want to assure 

you I am personally committed to a responsive and open dialogue 

with members of this committee as well as with your colleagues. 

I look forward to working closely with you, and I welcome your 

questions. Thank you. 

Chairman KLINE. Thank you, Madam Secretary. The light didn’t 

even turn red. I’m unprepared now. I’m at a loss. 

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Chairman KLINE. Seriously, I want to thank you, Madam Secretary, for your ongoing efforts to keep us informed about the Department’s progress in implementing the Child Care and Development Block Grant Act of 2014, as well as the opportunity for committee staff to communicate directly with your staff. 

Can you update us, briefly, on the timeline for the release of 

guidance in the proposed rules in accordance with the Act? 

Secretary BURWELL. I think, our staff has had an opportunity to 

go back and forth, and I think that’s helpful as we’re producing the 

guidelines. And I’m hopeful—I’m not sure which particular piece 

you’re referring to, and so I want to make sure, and we can follow 

up on that. But overall, we are making progress and hope to get 

them out. 

One piece that I would like to recognize with regard to the implementation of the authorities that you all gave us, there’s an important piece of the budget that is related to the implementation, and 

one of the things that we were told with regard to the authorities, 

improve the quality, improve the safety, and also, improve our ability to serve communities that sometimes aren’t being served, such 

as parents that work in different hours. 

And so there’s funding in the budget that we are talking about 

today on the discretionary side that I think it is important to do 

that, and I do want to raise that as a part of this conversation. 

That as part of doing the implementation, there is some funding 

to do that. 

Chairman KLINE. Okay. I’m not sure that’s exactly what I was 

getting at, but that’s good. Thank you very much. 

Secretary BURWELL. And I will get back on the specifics of the 

timing of the guidelines. 

Chairman KLINE. Just trying to get a better feel for the timeline. 

Secretary BURWELL. I’m happy to get back on exactly the timetable. 

Chairman KLINE. And again, I very much appreciate the exchange between staffs, very, very helpful. 

I want to take the remainder of my time, no doubt, and I’ll try 

to be brief, but there is an issue having to do with the Patient Protection and Affordable Care Act that’s just sitting out there that 

really, really needs to be addressed, and that’s the maximum 

amount of out-of-pocket limits for cost sharing that I’m sure that 

you’ve heard about. I’ve heard from several employers recently 

about this unilateral change the Department made to cost sharing, 

maximum out-of-pocket limits under PPACA. 

We can’t seem to determine where this is coming from. The statute is pretty clear. There are two separate and distinct types of 

coverage, self-only and other than self-only coverage, each with respective out-of-pocket limits. Before this new rule, any combination 

of family member’s out-of-pocket costs has counted towards the 

maximum of these out-of-pocket family coverage limits. Now, the 

Department has declared that starting in 2016, the individual outof-pocket limit applies first before the family limit applies. That 

means the cost of the employer coverage will increase because insurance will pay 100 percent of the out-of-pocket costs sooner. 

I understand that you’re aware; I have been led to believe that 

you’re aware of these concerns. I’m sure that employers have raised 

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this issue directly with you and your staff probably many times. 

They certainly have with us. 

We’d like to understand under what statutory authority you did 

that? And then I’d like to enter into the record letters from the 

ERISA Industry Committee, the American Benefits Council, and 

the National Coalition on Benefits, conveying their grave concerns 

to the Department’s new embedded maximum out-of-pocket limit 

rule. 

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Chairman KLINE. The letters also convey that compliance will 

not be possible by 2016 given that employers’ plans are already set 

for next year. It wasn’t until May, when additional guidance was 

issued, that most large employers knew this change applied to 

them. So there’s real confusion out there, Madam Secretary. And, 

again, I’m fairly confident that you are hearing some of this directly, but I want to make sure you heard from me. 

Can you commit to at least delay the impact of this, really, significant rule change for at least a year, and if not, why not? 

Secretary BURWELL. So with regard to the issue of the question 

of delay, we are now hearing and receiving feedback. We want to 

take and incorporate that and determine what we should do to 

move forward. I think it’s important to note why the change was 

put in place. And the change was actually put in place about the 

consumer and the fact that when one consumer in a family hits 

that individual limit and the question of should they hit that family limit and whether you should aggregate or the individual. Because, I think actually when consumers purchase and how the consumer thinks about this issue, I hear and understand, and we are 

hearing from the companies in terms of how they think about the 

question of the maximum out-of-pocket limit. 

But if you are an individual in a family, do you think that limit 

is your individual limit, and then there’s a broader family limit for 

all. And so once you’ve hit your individual limit, what would happen is you would keep going. And so you would not have those 

things paid for, and you signed up in a place where you thought 

your individual limit was your individual limit and your family 

limit was for all members of the family. And so that’s how the consumer has tended to think about it and at least what we’ve heard 

from the consumer side of it. 

And so that is why we have gone forward. We are hearing comments and want to incorporate those comments and understand if 

it is implementable. 

Chairman KLINE. Well, I understand the point of view of the consumer here, and I’m not making light of that. But the statute we 

think is pretty clear. And because there is so much confusion out 

there, and there is the uncertainty and arguably the inability to 

comply, we are hopeful that you will commit sooner rather than 

later to a delay of this rule change. 

And I’m going to try to—it’s already too late. The light has 

turned red for me. 

But, Mr. Scott, you’re recognized. 

Mr. SCOTT. Thank you, Mr. Chairman. 

Thank you, Secretary Burwell, for being with us today. I wanted 

to ask you a few questions about the Affordable Care Act, but, first, 

I want to thank you for your Department’s outreach efforts, particularly Joanne Grossi, who is the regional director in my area has 

just been outstanding in outreach into the community, making sure 

that people know about it, and during the signup period was all 

over my district. So I’m sure she was all over the region. 

Can you say a word about what the Affordable Care Act does for 

people with insurance in terms of preexisting conditions and job 

lock? 

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Secretary BURWELL. So two different things that I think it does. 

With regard to preexisting conditions, it creates a situation where 

anyone with a preexisting condition is able to get insurance. And 

so whether it’s the people that I’ve met as I traveled across the 

country that are concerned for their children as their children get 

older, if it’s child that has asthma or other conditions or someone 

who has actually gotten cancer and is now well and their ability 

to know that they won’t be locked out. So preexisting conditions are 

something that are no longer something that creates both health 

and financial worry for people in the system. 

And with regard to the question of lock out and job lock, there 

are many people who wouldn’t make changes because of their fear 

of losing coverage. And that is a part of the numbers that the 

chairman stated in terms of the changes that occur. Because with 

regard to the employer-based market, we have not, in the two 

years that the Affordable Care Act has been up, seen that shift 

from employer-based coverage in terms of the reduction and percentage of employees that are in employer-based coverage. We 

haven’t seen that shift. 

And some of the estimates are about people, though, who will 

choose to make a decision to go do something entrepreneurial if 

they want to start a business or make other changes in their lives. 

And so the lock that was created because they were fearful of losing coverage doesn’t exist because they have an option, and that 

option is through the marketplace. 

Mr. SCOTT. And what has happened to the growth in healthcare 

costs since the passage of ACA? 

Secretary BURWELL. With regard to the growth of healthcare 

costs, thinking about it in terms of we’ve had some of the lowest 

price growth per capita that we have seen in 50 years in terms of 

slowing of that growth. I think when discussing the question of 

growth and cost growth, while it’s a hard thing to do and recognize, 

one needs to look at historical growth and then what growth is. 

And so if we look at what was released recently in the Medicare 

trustee’s report, which is let’s reflect on the public sector costs of 

this growth, what we saw is growth of 1.2 percent over the period 

of the last four years. What we saw in that period before then was 

3.6 percent growth. And so what we’ve seen is a slowing in a lot 

of different places, both the public and the private, of that growth. 

Mr. SCOTT. And the programs under your jurisdiction, can you 

say a word about the effect of the sequestration if we don’t do 

something about the sequestration? 

Secretary BURWELL. So as we look at this issue of being funded 

at the lowest level in a decade when one accounts for inflation, it 

is across the entire Department, and whether that’s an issue of 

Head Start or child care that we’ll focus on in this committee, it 

also is in places like the NIH and our research or the CDC, who 

has been so active this year in so many ways, whether that’s Ebola 

or measles, and also in places like the FDA, who are doing things 

like making sure our food is safe and that we are watching and 

taking care and that our drugs and diagnostics are safe. 

So it’s across the entire Department. Another place that this particular committee is interested in, I know, is the older Americans 

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and the programs that we have there to support those older Americans around food and transportation as well as elder justice. 

Mr. SCOTT. Thank you. Head Start is not in the Department of 

Education. It’s in the Department of Health and Human Services. 

Can you explain why it’s important—what the services to low-income children get remaining in Health and Human Services that 

it would not be available in just an educational program and why 

Head Start is so important? 

Secretary BURWELL. So I think that the program of Head Start, 

we have it as part of our continuum at HHS that starts with home 

visiting. And thank you to all of you all who supported the sustainable growth rate bill that had the extension of the home visiting 

an evidence -based program that starts with that care in the home, 

visiting the home, and helping start children on the right track. 

And we believe that continuum as well as the changes in the authorizations in Head Start that you all have done to push to improve quality that is all part of a continuum, and the continuum 

is related to the issues that we work on broadly at HHS. 

And whether that’s starting the mother on the right trajectory 

with regard to her maternal health so the child is born in a certain 

environment that has been taken care for 9 months and then continuing that early care, starting that learning early and that brain 

development. The science that we know, and having a 5 and 7- 

year-old, of how quickly that neurodevelopment is occurring and 

how fast they are learning, sometimes it surprises me. 

But it is what we believe is a continuum of both health and the 

building block of healthy productive lives that we use at HHS. 

Mr. SCOTT. Thank you, Mr. Chairman. 

Chairman KLINE. I thank the gentleman. 

Dr. Foxx. 

Ms. FOXX. Thank you, Mr. Chairman. 

And Madam Secretary, welcome to our hearing. Madam Secretary, I appreciate you bringing up the Older Americans Act. 

We’re looking at—the Committee is looking at ways to promote 

best practices to combat elder abuse. And I wonder if you could 

talk a little bit about how the Department is working with other 

agencies to protect vulnerable elders? 

Secretary BURWELL. So working across the Department and obviously, the Department of Justice is a partner with some of the 

work we do. But most recently, whether it’s with our Departments 

and States, as well as other stakeholders. 

The White House Conference on Aging, we took an approach this 

year, where we actually went out to communities across the country, and this was one of the pillars and issues that we focused on 

and used that as an opportunity to bring in the engagement and 

involvement of both ideas as well as how we can implement better 

as a Department in terms of the issue of elder abuse. So we’re 

seeking that input to improve what we are doing both within the 

U.S. Government, but also with a number of the players that implement and those are stakeholders on the ground and States. Because many of the programs are actually delivered and implemented at that level. 

Ms. FOXX. And would you discuss a little bit those delivery models of the Older Americans Act and what makes them work well? 

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Working with other agencies, I’m sure, is the right thing to be 

doing, but are there ways to implement these similar delivery models across other programs across the country, and how is the Department providing leadership to do that? 

Secretary BURWELL. So I think two—there are many things, but 

I’ll just focus in a short time on two things that I think are important in this space. 

One is actually the awareness of the issue. Elder abuse is something that is not an issue that many focus on and whether these 

providers and the organizations in the community are a part of recognizing the issue. It is a little like the issue with victims in trafficking, creating a greater awareness of it is an important thing to 

do. 

I think the other thing that we think is important to do, is that 

when these acts occur that justice is served, so people know that 

when they are taking advantage of the elderly, and that’s a place 

where we need to continue to work with State and local officials on 

that as well as Federal. 

And I think one very specific example of that is the recent takedown that was done on Medicare. You all probably know that our 

most recent takedown, which was a joint effort with us, DOJ, the 

FBI, HHS, OIG, and CMS. It was over $700 million in false billing. 

And many of those examples were around elder justice issues 

where patients were being told they were being treated for dementia and were simply being moved from one location to another 

being charged for that and Medicare was therefore charged. So I 

think it is the combination of those kinds of things that we trying 

to bring together. 

Ms. FOXX. Thank you very much for that. 

Congressman Scott brought up Head Start performance standards. We know that Head Start is the largest program we have 

working with young children. But we’re concerned about the impact 

of the new regulations that you’re putting out there. 

Our reauthorization in 2007 required you to have regulatory revisions not result in the elimination of or reduction in quality and 

scope of services, but you are talking about a reduction of 126,000 

children’s slots, elimination of 10,000 teachers’ jobs. How can you 

ensure that the revisions that you are proposing are in compliance 

with the 2007 law? 

Secretary BURWELL. We have done three issuances of regulations 

with regard to implement the law, and this is the third of those. 

One of the things we did was make sure they are serving low-income communities, the other was making sure that there were reviews and people had to reapply for the money, the grantees. And 

so we set standards there, this is the third part. And in this part, 

we are using evidence-based studies to improve the quality and 

safety, which we believe that the authorization is what it told us 

to do. 

One of the things that the Chairman mentioned, that I think is 

important to mention, is we got rid of one-third of the guidelines 

in terms of simplifying and making it easier. With regard to some 

of the things that you are referring to, I think you are referring to 

the extension of the day and the year. And the evidence that we 

have seen, all the scientific evidence shows, that moving from three 

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51 

and a half hours to six hours is an important effort to provide the 

quality that we need to provide and the summers, having two children right now going through their summer, what they lose if they 

do not have that kind of continued education. 

We propose the amount of money that it would take in our budget. We’re hopeful that we can move forward on that. And the other 

thing is if grantees can’t meet that and have reason not to, there 

is waiver ability. 

Ms. FOXX. Thank you. 

Chairman KLINE. The gentlelady’s time has expired. 

Mr. Hinojosa. 

Mr. HINOJOSA. Thank you, Chairman Kline and Ranking Member Scott. I strongly support the Health and Human Services budget request and ask that we work together to forge a consensus on 

how to ensure that our families continue to have access to quality 

healthcare coverage and adequate funding for Head Start. 

We can invest in our preschool programs today or in juvenile detention tomorrow. We have heard Pope Francis deliver a very 

strong message all over the world urging leaders like us. The Pope 

says, we must make the right amount of investments to address 

poverty found in older senior persons and children in low-income 

families. 

Madam Secretary, thank you for your testimony on the Department’s enormous progress we have made since the enactment of 

ACA. It’s a pleasure to have you testify before this committee. 

Today, in my congressional district, because of the Affordable 

Care Act there are over 100,000 individuals who now have health 

insurance and 88,000 seniors who are now eligible for Medicare 

preventive services without paying any copays, co-insurance, or deductible. We know that another program, Head Start, is a crucial 

developmental program in my congressional district known as the 

lower Rio Grande Valley. This program serves between 15,000 to 

20,000 children and families. Head Start has made a significant 

impact on improving the opportunities for eligible children, especially our Nation’s Latino and African American youth. Thank you 

for your strong budget support for this program. 

My first question, what is at stake for our Nation if we ignore 

the ever-growing body of research, and we fail to sufficiently invest 

in quality early learning for our Nation’s minority children? 

Secretary BURWELL. So I think this is why this area in our budget, and we discussed the Head Start portion of it, but there’s also 

the child care proposal. And part of the child care proposal on the 

discretionary side comes to part of the chairman’s question in 

terms of implementing the authorization. That’s on the discretionary side. The broader proposal that we have, which is a larger 

mandatory proposal, is about making sure that there’s access on 

this continuum. 

And so what we do is we take care of that child from the moment 

of that home visiting and the pregnancy through those early years 

of education, and that we do that both for those at the lowest level 

of income, and Head Start is focused on that. But child care, and 

that’s a part of what we’re proposing is child care for working families, that there is supplement so that they can afford that, up 

through that school age. And so what we are trying to do is create 

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a continuum, which we think was a part of the authorization and 

some of the concepts of the authorization. 

This budget funds it fully. We think it’s one of the most important priorities. And as we reviewed the budget and put it together, 

it is a place where we made choices that we would prioritize and 

put a lot of our dollars because we think it is so important to the 

long-term health of those children and the well-being of our society. 

Mr. HINOJOSA. I agree with you, and I recommend that you consider adding more emphasis on early reading and writing for children from cradle through the fourth year so that they can love 

books and improve their vocabulary and be able to stay at grade 

level and do well. 

In my district, the majority of the uninsured population falls 

under the Medicare—excuse me, falls under the Medicaid coverage 

gap and does not qualify for assistance in healthcare marketplace. 

According to the Kaiser Family Foundation, up to 950,000 uninsured people would gain healthcare coverage if the State of Texas 

decided to expand Medicaid. What justifications, if any, have you 

heard or received, and how has HHS responded to discussions that 

you’ve had with the governors like Abbott in Texas? 

Secretary BURWELL. So with regard to the conversations with 

governors, I spent the weekend at the National Governors Association, and the year before that I did as well. In terms of any concerns that governors have, what I want them to know is we want 

to expand the program, we want to expand the program in a way 

that implements the statute, which is about expanding access and 

doing it for low income populations so it’s affordable. But we want 

to do that in ways that works for States. 

And so I think in terms of answering concerns and questions, 

whether it’s the negotiations that we did with Governor Pence, and 

I personally participated in a number of other governors so that we 

can make sure that we do this in a way that serves the citizens, 

the States, that may have different needs. And so that’s, in terms 

of one of the issues that comes up. I want to clearly articulate – 

I want to work with governors and their states. 

Mr. HINOJOSA. Thank you. I yield back. 

Chairman KLINE. The gentleman yields back. 

I’m going to yield to Dr. Roe, but I want to give members a 

heads-up here. We’re looking at a clock and time. I’ll be recognizing 

Dr. Roe for five minutes and probably Ms. Davis, maybe Mr. 

Walberg and Mr. Grijalva. After that we are going to have to start 

dropping down. So just start tailoring your questions we are going 

to go to four minutes and see if that will make it. I am trying not 

to go to three or two, but I want to give everybody a chance to be 

involved in this conversation. 

Dr. Roe. 

Mr. ROE. Thank you, Mr. Chairman. 

Thank you, Madam Secretary, for being here. Just some QFRs, 

some questions I want to bring up to begin with and then we’ll get 

to the questions. These are things I want your shop to answer. 

One is the Medicare wage index or area wage indexes. If you look 

at those around the country, it was never intended to be like that. 

The 20 of the highest are in California and Massachusetts, and 14 

of the lowest are in Alabama and Tennessee. For instance, what 

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you get paid in Santa Cruz, California, is 1.7 with the Medicare 

area wage index and it is 0.73 where I live. It’s putting us out of 

business. And that needs to desperately be looked at. 

The second thing I want to bring up, and I want to know what 

your solution for that is, the second thing I want to know are the 

RAC audits. The RAC audits, certainly, we are all against fraud 

and abuse. But in my State, the Medicare comes in, does these audits, withholds the payments, and we win 72 percent of them. And 

now, the backlog is so long, you can’t get in front of anybody to get 

your money back that you’ve earned, and that’s unfair. And I think 

you absolutely need to redo the RAC audits. 

And thirdly, this is a much deeper one, and it may take some 

time, but Medicare is on an unsustainable course, as you well 

know. Last year, in 2014, Medicare spent $613 billion, and we took 

in $304 billion in premiums. That’s unsustainable. And since its inception, $3.6 trillion, negative, of premiums over what we spent on 

the program. I’d like to know what your recommendations are to 

put this on a more sustainable course. Yes, through our reform we 

did save $2.9 trillion over the budget window. That’s a start. But 

I would like to know what those other issues are. 

And regrettably, I’ve got to ask some questions now that I don’t 

like asking, but I think are extremely important to ask. And also 

one last thing, question was for the QFR on IPAB. Do you think 

one person, that would be you now currently, sitting in that seat, 

should have the power to determine how Medicare dollars are 

spent if it goes over this formula? I’d like to know that, because 

there’s nobody on that 15-panel board right now. 

Recently, we’ve seen two videos that showed Planned Parenthood 

physicians basically having wine and eating a salad bargaining 

over the harvesting and sale of dismembered baby parts. I found 

this incredibly offensive to me as a physician and as an obstetrician. Have you seen those videos? 

Secretary BURWELL. I have not seen the videos. I’ve read the articles about them. 

Mr. ROE. Well, last week in the Wall Street Journal, it reported 

that you couldn’t comment because you haven’t seen it, but you 

need to see those, Secretary Burwell, as quickly as you can. And 

it’s only eight or ten minutes, but you need to look at those videos 

to see what the rest of us have looked at. 

And given Planned Parenthood’s, which I think is horrific conduct, Americans may be troubled to realize that Planned Parenthood gets over $500 million a year, much of it through your shop, 

through Medicaid and Title X funding. Having said that with a significant financial relationship, could you tell us what you’ve done 

to investigate these activities? 

Secretary BURWELL. So, first, because it’s so related to the budget issues we’re discussing today, the RAC issues and the backlogs, 

we have put together a strategy that includes, it is just because it 

is such an important issue and appeal, so I just want to make sure 

there is a budget issue in terms of extending the number of people 

that we can have to review the appeals because there are legal 

judges that we have to bring in. 

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istrative actions, including settlement. So, I just want to raise that 

because it is important. 

I want to go on to the broader issue that you’ve raised. With regard to the issue, I want to start by saying this is an important 

issue that people have passion deeply on both sides of the issue 

and whether that’s the issues of research that are important for 

eyes, degenerative diseases, Down’s syndrome, Autism, or the issue 

of belief. And I want to start there. With regard to the question 

of— 

Mr. ROE. Let me stop you, because my time is about up. Have 

you had any contact with Planned Parenthood yet? On this issue. 

Secretary BURWELL. I’m sorry? 

Mr. ROE. With regard to this issue, this sale of the . . . 

Secretary BURWELL. No. Planned Parenthood’s funding, the $500 

million, I think you mention I think is a number that is a State 

number. And with regard to Medicaid and States those are issues 

where— 

Mr. ROE. 41 percent of their funding comes through the Federal 

taxpayers. And let me just say before my time runs out, because 

we are limited in time. I found it absolutely amazing that Planned 

Parenthood could complain about a woman having an ultrasound 

before she terminates her pregnancy, and then uses an ultrasound 

so they can harvest body parts to be sold for fetal tissue. I found 

that absolutely astonishing. 

Mr. Chairman, I yield back. 

Chairman KLINE. The gentleman yields back. 

Ms. Davis, you are recognized. 

Mrs. DAVIS. Thank you, Mr. Chairman. And I’m sure there will 

be plenty of investigations on that by my colleagues. 

But I wanted to go on and just ask Mr. Chairman for unanimous 

consent that the CBO’s score showing that a repeal of the Affordable Care Act, which would add $137 billion to the deficit in the 

next decade, that this report be entered into the record. 

Chairman KLINE. Without objection. 

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Mrs. DAVIS. Thank you, Mr. Chairman. 

Thank you very much, Madam Secretary, for being here, for your 

service, and for joining us today. 

You mentioned NIH earlier. I know that you care deeply that we 

continue to fund this at higher rates. We absolutely cannot fall behind the global community in how we address science and innovation. And so I think that’s very, very important. And I’m pleased 

that the President has increased that funding. 

But I also wanted to talk about not just the innovation piece of 

it, but really the access piece and affordability, and particularly 

focus on the changes that you have recommended in reforming 

Medicare Part D. 

And specifically in ways that you call for in the budget request 

in terms of reducing Medicare costs both for the government and 

the consumer and looking at the question of giving authority to you 

and to the Department to negotiate drug prices in Medicare Part 

D. So can you talk a little bit about that and why that is part of 

the budget and why you think that this is so important? 

Secretary BURWELL. I think that we believe that the ability, as 

we look and address the issue, one of the issues that was brought 

up—the question of the long-term health of Medicare and how we 

work on that, is that we look at some of the issues that will be 

driving costs in the out year. We believe that drug costs are a part 

of that, and we see that happening. We see that both in terms of 

the numbers we see now, but in the out-year projections we also 

hear it from the private sector. 

So the belief is, and, you know, having come from the private 

sector and actually having come from a company that is known for 

its negotiating on price, Wal-Mart, the idea that we use market 

mechanisms to try and put downward pressure on price is something that we think is important. And so that’s why we’ve asked 

for those authorities so that we can try and work with the pharmaceuticals and negotiate to keep downward pressure on that price. 

That’s what we hope we can do, and we see it as part of the overall 

issues that we’re being asked about, how we transform the system 

for the long term. We believe there are things that we need to do 

and pressure we need to put. 

Mrs. DAVIS. What do you see as some of the key problems that 

you’re going to be having as you try to move forward with this? 

Secretary BURWELL. So I think with regard to this particular 

issue, it’s not one, you know, it is a legislative and a statutory 

issue. And so it will take a statutory change to grant the authorities to be able to negotiate. That’s not something that administratively we can do. So it is something where the action will sit with 

the Congress. 

Mrs. DAVIS. Uh-huh, yeah. Well, thank you for working on that. 

I know it’s not a simple way of moving forward, but it does seem 

to make a difference. And there have been so many stories lately 

about how the high costs have, really, not just bankrupted families, 

but made it very difficult for people to access important lifesaving 

drugs. 

I wanted to just for a moment also talk about the increasing access for folks here at home. And we know that the ACA really has 

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sured. I actually have a constituent in my district who was going 

regularly down to Tijuana to get the medications that she needs, 

and this now means, as a result of her being insured, that she 

doesn’t have to do that any longer, and it has been a big difference 

in her life. 

So I wondered if you could just talk a little bit about how dramatic the increase in the uninsured population has been since the 

implementation of the ACA and what this additional coverage has 

meant in terms of increasing patient outcomes. 

Secretary BURWELL. So with regard to that, I will try and be 

brief, and just in terms of numerically the number I think you 

know is over 16 million is the number of reduction in the insured. 

With regard, I think what tells the story better are the individuals, 

and whether that’s Anne Ha, a woman who was 26, uninsured, her 

mother told her to sign up; she needed insurance, she didn’t, but 

in the end she listened to her mom. A month later she discovered 

she has stomach cancer and had the coverage that she needed. And 

that coverage both helped her for her health and actually, recently 

married, and in addition to that, though, the financial security in 

terms of her business and her availability to continue on in that 

way as well. 

So I think it’s the individual stories combined with the numbers 

in terms of what we’re seeing of what the extended coverage 

means. 

Mrs. DAVIS. Right, yeah. I particularly have heard about that 

when it comes to type 2 diabetes and the prevention that’s made 

a real difference for those folks. So thank you very much for your 

service. 

Thank you, Mr. Chairman. 

Chairman KLINE. The gentlelady’s time has expired. 

Mr. Walberg, you are recognized for five minutes. 

Mr. WALBERG. Thank you, Mr. Chairman. 

And thank you, Madam Secretary, for being here. Thank you for 

reaching out to us before this as well. 

I want to ask you the first question, how many fictitious claims 

have been paid since enactment of ObamaCare, and how much has 

been lost due to this fraud? But to just bring it into context here, 

earlier this month, GAO released a report that investigated 

Healthcare.gov through various undercover tests performed 

throughout the 2014 coverage year. The report revealed some stunning things, that the marketplace approved subsidized coverage for 

11 out of 12 fictitious applicants created by GAO resulting in a 

payment, they state, of about $30,000 to insurers on behalf of these 

fake enrollees. 

For seven of the 11 successful fictitious applicants, GAO intentionally did not submit all the required verification documents to 

the marketplace, and the marketplace even then did not cancel 

subsidized coverage for these applicants despite the inconsistent 

and incomplete information. 

And so subsequent to that, how many fictitious claims have been 

paid since the enactment of ObamaCare, and how much has been 

lost due to the fraud? 

Secretary BURWELL. So with regard to the example, we take very 

seriously the issue of program integrity and want to continue to 

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improve it. We look forward to the GAO’s recommendations out of 

that study. We haven’t seen those yet. We look forward to understanding what they are, because we welcome the opportunity. 

With regard to the question of answering the number, because 

GAO didn’t find actually that there were fictitious claims, they did, 

when they had individuals who came through the system—first, 

they came to Healthcare.gov, the marketplace in terms of electronically, couldn’t get through. Then they actually came through, 

through the phones, and that’s where they got through. At that 

point, because they are GAO, they were able to do things that for 

everyone else would be perjury; that would have up to a $250,000 

fine affiliated with it. 

Mr. WALBERG. And they were successful? 

Secretary BURWELL. And were successful in breaking the law in 

terms of what they were doing to go through. 

With regard to the next step, and there are a number of gates. 

There’s the gate at Healthcare.gov, in terms of that was where it 

was caught. Got through at the point, you know the question of 

confirmation of information. Then because they did not file taxes, 

what will happen to these individuals is in this year, as per statute, they will no longer be able to get subsidies in the next year, 

because at that point the IRS will let us know that they have not 

filed taxes. 

Mr. WALBERG. So, we don’t know how many fictitious complaints 

may have been filed already other than GAO? 

Secretary BURWELL. No, we don’t. We know of the 11 examples 

of GAO— 

Mr. WALBERG. We know that. 

Secretary BURWELL.—with regard to those that have committed— 

Mr. WALBERG. Twelve examples, 11 got through. 

Secretary BURWELL. With regard to those are the only examples 

we know of because as GAO said in the report, they didn’t know 

of other examples other than those that they had created. 

Mr. WALBERG. They don’t, yes. But you don’t know either? 

Secretary BURWELL. So, with regard to the things we have in 

place, what we do know is we have a number of steps in place. And 

within 90 to 95 days, we go through data matching. And this year 

already, 117,000 people who have not—we don’t know that they are 

fictitious, we know that they have not provided the right documentation—and the first quarter of this year, 117,000 people came 

off. 

Several other hundred thousand people, over close to 200,000 

people, received information saying we did not have enough justification for their income and, therefore, their APTC, their tax 

credit, would be adjusted downward. 

Mr. WALBERG. What— 

Secretary BURWELL. So we are on a constant path of making sure 

we have the information that aligns with what we have been told, 

and if not, we are taking action. 

Mr. WALBERG. Without getting into specifics of these cases that 

were successful, again, which shows that there should be concern, 

can you explain to the committee what process has likely failed to 

allow these fictitious applicants to gain subsidies? 

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Secretary BURWELL. So, there are a series of processes that 

occur. And in terms of the gates, when people have lied about their 

information – it’s something that can happen in the system. It can 

happen in all of our systems. The way we catch that is in the data 

matching and information. So it depends on whether they’ve lied 

about which part and that could have to do with— 

Mr. WALBERG. But which ones failed? 

Secretary BURWELL. Pardon me? 

Mr. WALBERG. Do we know which ones failed that allowed. 

Secretary BURWELL. No, because we have not seen the GAO examples. One of the things that would be very helpful to us is to 

actually see the example. Because all we know is what you’ve said. 

And if we have the information, then we can find where the system 

may not be working. Right now in terms of the system, as the examples I gave you— 

Mr. WALBERG. What’s keeping you from getting the examples, 

then, if that’s the case? This came out earlier in July. 

Secretary BURWELL. At this point, the GAO has neither given us 

recommendations or— 

Mr. WALBERG. Have you asked for it? 

Secretary BURWELL. We have asked the GAO in terms of can we 

understand how you did this. They believe they are protecting their 

sources and methods. 

Chairman KLINE. The gentleman’s time has expired. 

Mr. Grijalva, you are recognized for five minutes. 

Mr. GRIJALVA. Thank you. 

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

With regard to the GAO question you just received, the gaming of 

the system and the process, is this such a rampant phenomenon 

that it is undercutting the very pinning’s of the Affordable Care Act 

or are we dealing with an issue in which as you get more information, you deal with it? 

Secretary BURWELL. At this point, there are a number of gates 

and efforts on program integrity in place, and that’s the initial information gathering, which we check at the hub at that point, 

when that goes through, we also—when we don’t have data matching, as I said, within 90 to 95 days, we review those cases, we take 

action. 

At the point of the filing of taxes and in the examples that we 

are given, folks didn’t file their taxes, that is the next place where 

that would occur, and the next gate will occur in terms of that people choose not to file their taxes for some reason, that is the point 

at which subsidies will go away. 

We have a number of gates in place. We are implementing those. 

If we can understand places where people think those aren’t working, we do want to understand that so that we can work to improve. We have improved the timetable. 

Mr. GRIJALVA. But GAO shares the methodology with you and 

those examples. We are waiting—you are waiting for that, correct? 

Secretary BURWELL. We are looking forward to GAO coming out 

with recommendations, which is the part that has not yet occurred. 

Mr. GRIJALVA. Thank you. The President’s commitment to early childhood education, it is reflected in the budget proposal, $1.5 billion extra for early head start and for head start itself. Briefly, if 

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you could tell us, you know, the budget levels of spending caps established by the majority, what is that going to do to the fact that 

you are trying to build capacity, you are trying to stress quality 

and accountability for providers for these children, and what does 

that do to capacity? 

Secretary BURWELL. So with regard to the levels, I think that if 

you are going to meet those levels and you want to fully fund head 

start, what it will mean are dramatic cuts to things like NIH or 

CDC in terms of other places. I think we believe we put together 

a budget that is a budget that as I mention, you know, there is savings in terms of deficit reduction that comes from the HHS budget 

as a whole, that we put together a plan and an approach that affords us the opportunity to fund all of those things. 

But at the current cap levels, you would not be able to do that, 

and so you would not be able to implement the changes in head 

start or you would have to make dramatic choices in other places. 

One of the largest budget areas for HHS is NIH. 

Mr. GRIJALVA. Yeah. And I think the last point, community 

health centers, that was mentioned briefly in your testimony. At 

least in my community, it is an essential network for health delivery, an essential part of the Affordable Care Act delivery system. 

If you could talk to the committee as to that role and how the 

budget that you are talking about is reflecting an—continuing that 

commitment that the President made to the health centers at the 

inception of the Affordable Care Act discussion? 

Secretary BURWELL. And we appreciate the work that was done 

also in the sustainable growth rate bill in terms of these issues. 

The community health centers serve approximately one in 15 

Americans actually are served by community health centers. We 

think they are an integral part of care. They are an integral part 

of primary care, a very important part of making sure as we expand access that we have an ability to serve. 

That is a part of why they were extended as part of the original 

Affordable Care Act and are extended now, as we have seen in the 

number of uninsured drops so that there are places for people to 

go as part of that. We believe they are a successful part of coverage, especially in communities that don’t always have as much, 

and whether that is rural, minority, or other communities, that 

these are an important part of that. 

They are also an important part of integrating behavioral health 

and primary health together so that we can get to the place where 

that type of coverage is one. 

Mr. GRIJALVA. Thank you. I yield back, Mr. Chairman. 

Chairman KLINE. The gentleman yields back. 

We are going to move members to four minutes because we are 

watching the clock. I can’t seem to get it to slow down, so Mr. 

Guthrie, you are recognized for four minutes. 

Mr. GUTHRIE. Thank you. 

Thank you, Madam Secretary. Thank you for being here again, 

and I appreciate it. I want to talk about the employers’ sponsored 

health insurance, the small market group definition. The Affordable Care Act in Section 1304 expands the small market group definition to 100 employees, so of particular concern are employers 

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from 51 to 100, because if you are below 50, you are not mandated 

to provide. 

Once you are, maybe 100, 102, I don’t know what the number is, 

but once you start growing, then you are able to self-insure when 

you get a bigger pool because a lot of bigger businesses aren’t having the same issues. 

So the trap seems to be, and I have heard from a lot of employers’ insurers and actually, a lot of colleagues on both sides of the 

aisle have been working to try to fix this problem. And I have seen 

estimates of a 30 percent increase from different studies. But the 

issue is, you know, employers from 51 to 100, if they go into this 

small market group definition, will have expensive mandated benefits, and there is a big concern, as I said. It is bipartisan over here 

in the Capitol, and so I just wondered if you have looked at this 

issue and what actions are you looking at taking? 

Secretary BURWELL. So looking at the issue right now, one of the 

things I would ask, if we could follow up with you and your staff 

to make sure that we are getting the comments that you are hearing directly from either employers or other groups. It would be very 

helpful. There is, you know, another side in terms of expanding the 

other market that people argue, but we would love to hear directly 

if you have those comments— 

Mr. GUTHRIE. Absolutely. 

Secretary BURWELL.—as we are reviewing that. It would very 

helpful to hear the specifics of why people assume it will work the 

way that you described it working. There are others that argue the 

other side of this issue, so it would be helpful if you could follow 

up on that evidence. 

And so, I want to understand in terms of a policy perspective and 

then the question is would we have authorities, and so those are 

the two questions we are examining right now. It is a timely conversation, so if I could ask that we follow up with your team or you 

directly to— 

Mr. GUTHRIE. Absolutely. 

Secretary BURWELL.—make sure we have those comments. I 

would appreciate having the facts from the field to inform our conversation. 

Mr. GUTHRIE. Okay. We will make sure that happens. There is 

a bill, it is H.R. 1624, and it has 158 cosponsors and is bipartisan. 

It is not just—I mean, it is a very bipartisan, look at what is going 

on, and having said that, Mr. Chairman, I have a letter actually— 

and I do have a letter, we will share it with you, from 19 employer 

groups regarding this, and I would like to enter into the record, 

unanimous consent to enter into the record. 

Chairman KLINE. Without objection. 

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Mr. GUTHRIE. Thank you, Madam Secretary, and I yield back. 

Chairman KLINE. The gentleman yields back. 

Mr. Courtney, you recognized for four minutes. 

Mr. COURTNEY. Thank you, Mr. Chairman, and thank you, 

Madam Secretary, again for your accessibility since taking over, 

and it’s much appreciated. For the record, I just want to note we 

had a great conversation to talk about the observation coding issue, 

which still is a very, I think, widespread problem out there for 

folks who are discharging from hospital, and unbeknownst to them, 

find themselves in this sort of coverage gap for Medicare to cover 

medically prescribed services. 

Since we spoke about the two-day midnight rule, I have already 

got a sheath of input from folks who, again, I will share with you 

about why that by itself is just not a solution to this problem. So 

but we will move on. 

The chairman mentioned earlier about the insurance rate increases that were reported a while ago in the press. I would just 

point out, coming from Connecticut, a State which embraced this 

law, is now in year three of its exchange. 

Just a couple of days ago, some of the insurers who participate 

in the exchange revised downward their initial rate request, so for 

example, Anthem came in at 6.7. They revised downward to 4.7. 

This is prior to insurance department rate review. The Co-op, 

which last year cut its rates by 8 percent, came in with a 13 percent rate increase. They revised downward to 3.4 percent. And the 

largest insurer on the exchange, ConnectiCare, which is a private 

health insurance company, they came in with a whopping two percent increase earlier. They have now revised downward to .7 percent. 

And I point this out because this is a cohort that actually has 

claims experience under its belt now, so that the fear amongst the 

actuaries, that the walking wounded, in the exchanges were going 

to spike up, you know, in the initial years. I mean, we are actually 

seeing incredible stability in terms of the rates. 

We also are seeing new insurers come into the marketplace. Harvard Pilgrim is now knocking on the door and is coming in to sell 

their product in Connecticut. So again, your Department has been 

boosting the insurance department rate review piece of this, and I 

am just wondering, you know, if you could share, you know, from 

a global standpoint, you know, whether or not some of these fears 

are really overstated? 

Secretary BURWELL. So with regard to the rate issue, it is—I 

think what you were pointing to is one of the things about the Act 

that is important is about adding transparency and the light of day 

to things in the marketplace to make a market work so that individuals have information and that there is pressure in the market 

to make it work, and that was one of the ideas. 

And so when people saw the rates, the rates that were reported 

are only the rates really, in most States, that are above 10 percent 

because that is required. If a company is going to raise the rates 

above 10 percent, part of the law is they have to—it has to be posted. We have to report it while the State insurance commissioners 

review it. That is the other part of this, is that it needs to be reviewed. It doesn’t just happen that they propose it. 

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If they are going to propose above 10 percent, they need to justify 

it, and so that is a part of the process at work. And what you see 

in terms of Connecticut and what just happened is, that creates 

downward pressure, both in terms of the public pressure and the 

requirement that you have to justify any rate increases. 

And so we think, overall, what we have seen last year is that the 

rates come in here and then that there is downward pressure. We 

also see in States like Connecticut and actually California just 

came through yesterday, and their rates were at 4 percent, which 

is lower than their increase of last year. 

And so that is what we will continue to watch and monitor. The 

reason we recently had a conversation with the State insurers to 

make sure they know and are using that tool of rate review, to put 

that downward pressure, which we believe is an important thing 

to do, making the market work. 

Mr. COURTNEY. I mean, as a former small employer who double 

digit requests were—you know, or increases were just a matter of 

course, I mean, to see a 2 percent or .7 percent, or—really that is 

eye popping in terms of— 

Secretary BURWELL. The difference. 

Mr. COURTNEY.—the stability. 

I yield back, Mr. Chairman. 

Chairman KLINE. The gentleman yields back. 

Mr. Barletta, you are recognized for four minutes. 

Mr. BARLETTA. Thank you, Mr. Chairman. 

Secretary Burwell, my district is home to a number of small family run businesses that sell premium cigars to adult consumers. 

These job creators have expressed to me concerns about the impact 

of an expansion of FDA’s regulatory authority under the Tobacco 

Control Act on their businesses. 

Their shops serve a distinctly adult clientele, and I do not believe 

this category was the intent of Congress in 2009 when the law was 

passed. Can you tell the committee what steps you are taking to 

ensure that such businesses, which are a staple of Main Street 

America, are not regulated out of existence? 

Secretary BURWELL. With regard to right now, as we are in the 

middle of a rulemaking process, I think you probably know that we 

actually proposed two different alternatives as part of the rule. To 

gather the evidence and information with regard to the question of 

premium cigars and how they are or are not sold to children, you 

know, that was a part of what we are trying to do, and we are reviewing that and we are in the middle of that process now. 

Having said that, as we are in that process, a part of your question was the recognition of small employers, and that is something 

that will be taken into consideration, no matter where the rule 

ends. It is something, I think, is very important that we do as we 

think about implementation, and so wherever the rulemaking 

comes out, as we are in the process, but I do want to recognize the 

point that you have made, which is making implementation for 

small employers and small institutions possible, whatever it is. 

It is something we consider a real priority and something we believe, no matter where you are we can work on as part of implementation. 

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Mr. BARLETTA. The proposed deeming rule has been under consideration for more than a year. Regulatory uncertainty is exceptionally challenging for small businesses, who are trying to plan for 

the future, as you know, open new stores, hire more workers, and 

serve their customers. When do you anticipate this rulemaking to 

be finalized? 

Secretary BURWELL. I am hopeful that we will do it as quickly 

as possible. I think the issue you have raised is one of many complex issues that we received, I think you know, a number of comments on. We are trying to work through how we get to a balanced 

answer is what we are doing and trying to do that as quickly as 

possible. We appreciate the point that you made about uncertainty, 

again, in terms of recognition of what this means for the business 

community, especially small players. 

Mr. BARLETTA. Okay. Thank you. I yield back, Mr. Chairman. 

Chairman KLINE. The gentleman yields back. 

Ms. Bonamici, you are recognized for four minutes. 

Ms. BONAMICI. Thank you, Mr. Chairman, and thank you, Secretary Burwell, for your testimony, and thanks to you and the Department for all your work on so many issues, healthcare, precision 

medicine, I am interested in that, mental health services, thank 

you for your work on early childhood education, community and 

family support programs. 

I want to spend my short time talking about the Older Americans Act, which recently celebrated its 50th anniversary, and I 

want to thank Chairman Kline and Ranking Member Scott, I know 

they are committed to working together with my colleagues and me 

to successfully reauthorize the OAA. Thank you to Dr. Foxx for 

calling out the issue of elder abuse, and I want to emphasize that 

elder abuse includes both physical abuse, but also financial abuse. 

So I have three questions, and I think what I will do is tell you 

what the three are to save time. First, as we know, the population 

of older Americans is changing rapidly, so can you talk about what 

steps you are taking to modernize the administration for community living programs, as our older population is becoming increasingly diverse. 

Secondly, when I talk to people about the Older Americans Act, 

they know about the nutrition programs, especially programs like 

Meals on Wheels. We know that the population of seniors is expected to double by about 2050, so we all support investments that 

will yield greater efficiency. So can you talk about how the Department is promoting evidence-based practices among nutrition providers and how you plan to spur innovation in those essential nutrition services? We know that oftentimes that is the only social 

contact seniors have as well is with that meal. 

And then my third question has to do with the family caregiving. 

Seventy-seven percent of caregivers say that family caregiver support services make it possible for them to continue to care for their 

loved ones, it keeps seniors at home, but of course, it is hard work, 

and training in respite care services for caregivers are very important. Many of these caregivers are in the sandwich generation 

where they are taking care of parents and children at the same 

time. So what is the Department doing to prepare and support a 

large diverse community of caregivers? 

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Secretary BURWELL. So we will quickly try and work through 

each of these. In terms of the modernization, a part of the modernization, as I discussed, how we actually went about doing the 

White House conference on aging. 

Ms. BONAMICI. Right, right. 

Secretary BURWELL. And getting that input because it was a very 

different approach in terms of being out in the community, using 

technology, including the fact that the White House Conference on 

Aging, actually people could participate through technological approaches, and so changing the way we think about our work in 

terms of technology and the fundamental idea of people’s engagement in our programs and their feedback, being more customer 

friendly and doing it in ways that use technology are two things 

in terms of the modernization. 

In terms of the evidence-based practices around nutrition and 

meals, and I think that is part of a broader category of what I 

would consider prevention and preventative care and making sure 

that we are doing that correctly. And that, I think, is actually centered a little less than ACL and a little more with CMS, and it is 

also a part of the Affordable Care Act in terms of people knowing 

that they can do preventative and wellness visits without copays. 

Those numbers are increasing. We need to increase them more, 

so the people accessing those services are not at the level—they are 

improving, but it is a place where we need to send more time. Nutrition and wellness comes into that as well in terms of how it fits 

into this broader thing that I think changes that but changes a 

larger piece. 

The last piece is the family caregiving and encouraging that staying in community at home. And you probably have seen our most 

recent rulemaking at CMS, which is an important part of reforming the overall system of delivery of our healthcare and paying in 

ways that encourage that kind of care at home. And so the rulemaking and the demonstration we are doing there are probably our 

most effective tools because those are the ones that scale broadly 

and because payment is an important part of how people are making these decisions about staying in a community versus making a 

change. 

Ms. BONAMICI. Thank you so much. I see my time has expired. 

Thank you, Mr. Chairman. 

Chairman KLINE. Thank the gentlelady. 

Mr. Carter, you are recognized for three minutes. 

Mr. CARTER. Thank you, Mr. Chairman. 

Ms. Burwell, earlier this year you received a letter, along with 

Secretary Lew, from a group of employers with workforces who 

have variable hours, and it was specifically to address the employer 

notice and appeals process, because it is very important for employers to get notification about employees who have received subsidies; otherwise, those employees are going to be facing tax penalties if they declined a more affordable employer plan and accepted the subsidies, so this is very important. 

It is my understanding that, as of yet, none of those employers 

have received anything from HHS. Can you give me an idea, just 

a date of when you expect to give notification to employers? 

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Secretary BURWELL. Mr. Carter, this issue is one I am not specifically familiar with, but my understanding of what you are talking about is it is a Treasury issue because what you are talking 

about is tax information on the individuals in terms of they received an APTC, and that is a matter of— 

Mr. CARTER. Okay. Can you just get back with me and let me 

know a date when we can expect for that to be resolved and start— 

Secretary BURWELL. I am happy to raise with Secretary Lew the 

question that you have raised. 

Mr. CARTER. Fair enough. Fair enough. Okay. Notification to the 

employers. You would agree that those employers who have 

multistate locations, it would be better if they got one notification 

as opposed from every State? That is also something I am very concerned about, and I hope you look into at that as well. 

You do agree, obviously, that it is a burden on these employees 

when they have a tax penalty at the end because they didn’t accept 

the employer’s more affordable plan. So that is what we are trying 

to get at now, right? 

Secretary BURWELL. What we want to do is make sure that 

where employers should cover, as appropriately, that they are providing coverage, and if the employee makes a choice to not accept 

the coverage by an employer, that they don’t receive subsidies they 

shouldn’t in terms of— 

Mr. CARTER. Right, right, but it would have helped if the employers had gotten notification, so that is what we are trying to achieve 

here. 

Also, right now you are using a paper system. Do you have any 

idea when you will be going to a computer system? 

Secretary BURWELL. A paper system, I am not sure with regard 

to what you are referring to. I am sorry. 

Mr. CARTER. Okay. Well, I will get clarification on that and send 

you a letter later. 

Secretary BURWELL. Okay. Okay. 

Mr. CARTER. In your opening statement, you said that over $100 

million would be given to states and used for prescription drug 

abuse. 

Secretary Burwell, I am a pharmacist, the only pharmacist currently serving in Congress. I have witnessed firsthand people’s careers, people’s lives, people’s families being ruined, and people actually losing their life as a result of prescription drug abuse. And 

one of the limitations on that for pharmacists is that Medicare limits pharmacists as to what they can do with this in the way of compensation. 

There is a bill, H.R. 592. I hope that you will look at that closely. 

This is something that needs to be addressed. This is an epidemic. 

This is one of the biggest drug problems that we have in this country, prescription drug abuse, one that has really gotten out of control. As a member of the State Senate in Georgia, I sponsored the 

prescription drug monitoring program that is now law. This is 

something that we really need to work on, and we can help you in 

our profession, and we want to help you, but please look at that 

bill, H.R. 592. 

And Mr. Chairman, I yield back. 

Chairman KLINE. The gentleman yields back. 

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Mr. Pocan, you are recognized for three minutes. 

Mr. POCAN. Three minutes. Thank you, Mr. Chairman. I will go 

really quick. Thank you for being here, Secretary Burwell. 

First, I am glad to see that NIH increase in the budget. The 

funding, as you know, with the sequester, it has been especially 

hard. I have the University of Wisconsin in my district, which has 

a lot of research going on. One of the things that we have noticed 

because of this cutback of funding is that now the age of the average first time grant recipient is 42, and it used to be 36 in 1980. 

A lot of young researchers are looking at a lot of other areas to go 

into, and we want to keep the talent there. 

Senator Baldwin and myself and others have introduced a bill 

called the Next Generation Research Act trying to address some of 

those concerns. I am just wondering if you could very briefly just 

address how we can try to help those younger researchers as we 

move forward in NIH funding. 

Secretary BURWELL. I think it is about creating a certainty in 

terms of the years that we have been through recently with regard 

to everything from sequester to shutdown, the ability to create the 

certainty. It is just like the certainty we need to create for those 

small businesses that were referred to. 

People having certainty in knowing how things are going to run 

in regular order and assurance of the funding is how people are 

going to make their decisions. If you are making a decision to get 

a Ph.D. in a particular area, that is a long period of time you are 

making a financial commitment, and you want to know there is 

certainty at the other end. 

So I think the thing that we can do is create certainty around 

funding streams, that the funding for this type of research, basic 

research and other research that NIH does, is going to be there, 

and so that is one of the things we want to work to do, which is 

why we have in this budget a billion dollar increase. 

Mr. POCAN. If you could take a look at that Next Generation Research Act, too, working with a lot of those younger scientists, we 

have had some ideas, too, we would like to propose, at least while 

the sequester is still out there. 

Secondly, and I am going to piggyback a little bit on Representative Hinojosa’s question around the States that haven’t done the 

Medicaid expansion. Unfortunately, States like my State, Wisconsin, where Governor Walker is, you know, in the increasingly 

smaller number of States that hasn’t done this, we would save 

about $400 million over the next two years in our State. Almost 

85,000 people would have additional healthcare. 

You know, as you look in—and I am glad you just met with governors about this, but you know, as a Member of Congress, this is 

very frustrating. I actually do everything I can to get resources 

back to my State, and then I see something like this. You know, 

what can we do for the States like Wisconsin that are just really 

caught in this bad spot because we have governors that refuse to 

expand this? 

Secretary BURWELL. So with regard to, you know, that is where 

the decision, as know, sits with the governors and State legislatures, not all States. Some States, it is just the governor, and so 

continuing to work. But I think one of the most important things 

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is articulation of the benefit, both the economic, job creation, and 

what it means in terms of State budgets as well as the individual. 

Obviously, that is the place where we focus our most attention. 

Mr. POCAN. I am just going to wrap this thing. If you also need 

names of people who have told us they benefitted from the Affordable Care Act, you know, I go into little towns in my district, 

Spring Green in rural Wisconsin, small business, you know, they 

come and they grab their husband from upstairs, the wife had to 

tell me this is the first time they have had healthcare. I have had 

caregivers stop me in the grocery store crying because it is the first 

time in her adult life she has been able to have healthcare. If you 

also want those kind of things, we are more than glad to share 

those through our office. 

Secretary BURWELL. Thank you. 

Chairman KLINE. The gentleman’s time has expired. 

Mr. Russell, you are recognized. 

Mr. RUSSELL. Thank you, Mr. Chairman. 

I would like to thank you, Madam Secretary, for your distinguished service both to the Nation and also, to your charitable 

work. 

As a small business owner that has a small workforce well under 

the 50 threshold, I have seen a 68 percent increase in health insurance that I provide my employees over a two-year period. Do you 

believe increasing the cost of insurance will encourage or discourage small businesses providing insurance? 

Secretary BURWELL. With regard to the 68 percent increase, is it 

people taking it up, or is it the cost itself? 

Mr. RUSSELL. It is the cost itself. We are part of a pool, being 

a light manufacturer, and so, you know, we can’t do the groups on 

our own, but we can pool with others. And we have seen a 68 percent increase in two years. 

Secretary BURWELL. Is it particularly incident-driven, having, 

you know, worked as a small employer at one point in time, when 

we would have, you know, we had a couple of very large cancer 

cases or we had a number of pregnancies at one time, was it those 

kinds of things? Because what we want to do is get to the issue. 

What you are describing is a case that is not the experience that 

we have seen for most, and what I want to do is understand it. 

Mr. RUSSELL. Sure. 

Secretary BURWELL. So we can understand why— 

Mr. RUSSELL. We have not even filed claims. We have been in 

business for five years. 

And my second question is, in the HHS’ 2011 report entitled 

‘‘Drug Abuse Warning Network,’’ it cited that 455,000 emergency 

room visits were directly associated with marijuana use. Further, 

supporting documentation shows multiple adverse health effects. 

Do you believe the President’s policies in not enforcing Federal 

law on illegal marijuana States that violate the law promote or prohibit HHS’ goals on emergency care reduction and drug abuse prevention? 

Secretary BURWELL. So, with regard to the HHS role in this 

space of marijuana, we are the research, the regulator, the educator, and the treatment. And with regard to the issue that you have 

raised in terms of the question of the health impacts of this, it is 

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something that we are spending time on. You may know we recently actually changed a rule that will lead to increased research 

that we hope will afford us the opportunity to do more and better 

education in the space of the damage. 

Mr. RUSSELL. And then my final question and you certainly don’t 

have to comment on the ongoing investigations that will be necessary and that sort of thing, but given that HHS provides significant Title X funding to Planned Parenthood, do you believe personally that the harvesting of infant body parts to be moral? 

Secretary BURWELL. So as I said, this is an issue, an important 

issue, that has strong passion and strong beliefs about the importance of the research and other beliefs, and what I think is important is that our HHS funding is focused on the issues of preventative care for women, things like mammograms and cancer prevention screenings with regard to our relationship there. 

With regard to the other issues, the attorney general, I think, 

has right now, is under review to make determinations on what is 

the appropriate next step. 

Mr. RUSSELL. I yield back my time. Thank you, Mr. Chairman. 

Chairman KLINE. The gentleman yields back. 

Ms. Adams, you are recognized. 

Ms. ADAMS. Thank you, Mr. Chairman. Thank you, Ranking 

Member Scott. Madam Secretary, thank you for being here, and 

some of my questions have already been answered. 

But let me first of all say that I have, over the years, appreciated 

Planned Parenthood’s good work in promoting healthcare for men 

and for women, and I am a little bit disheartened by all the attacks 

to undermine the good work that they do. But having said that, let 

me move on to Affordable Care. 

My State of North Carolina is one of those 24 that did not expand Medicaid. We are looking specifically at—with all of the great 

benefits, I am still perplexed why our governor and our legislature 

decided not to do that, 317,000 more North Carolinians would have 

had it. I know you met with the governors. 

My question is when we look at North Carolina having one of the 

highest rates of uninsured adults in the country, standing at 24 

percent, it is critical that we take a serious look. And what are the 

options? Are there options for folk in my State and other States 

that have not expanded Medicaid that—who may want to consider 

it in the future, are there options that they have? 

Secretary BURWELL. So with regard to the options for the individuals, I think, you know, that is why community health centers are 

going to continue to be extremely important in terms of ensuring 

that people who don’t have coverage have care. They are an important part of that. 

With regard to the options in terms of States making those decisions to do that expansion, we want to work with States, we want 

to provide them with different options and opportunities. That is 

what the 1115 waivers are about. We have done that. We have 

done that with Governor Pence in Indiana, and that program is up 

and fully running. There are other governors that we’re having 

those conversations with, and we look forward to the opportunity 

to understand what are the core considerations of the State in 

terms of moving to reduce that coverage gap that you describe in 

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North Carolina, which is one of the largest states in the Nation 

now. 

Ms. ADAMS. Thank you very much. For somebody in my position, 

I did serve in the legislature for 20 years. I am still at odds with 

the governor and the State legislature about it, so can you give me 

any suggestions about how to kind of push them along and to get 

closer to ensuring the low income people in North Carolina who it 

will— 

Secretary BURWELL. I would certainly defer to you on how to 

work with your own State governor and legislature. 

The only thing I will say is when you look at Kentucky and the 

analysis that’s been done, in the State of Kentucky—and this is by, 

you know, an accounting firm in the University of Louisville, 

40,000 more jobs and 30 billion flowing into the State by 2021, and 

so that, from an economic perspective, just seems to be an anchor 

of a place to talk about. 

Ms. ADAMS. Yes, ma’am. That makes great economic sense for us 

to do it. I’ll certainly continue to push those folk in North Carolina. 

Thank you, Madam Chair—Mr. Chair. I yield back. 

Chairman KLINE. I thank the gentlelady. 

Mr. Allen. 

Mr. ALLEN. Yes, thank you. 

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

You’ve got a tough job. It’s hard to deal with some of the issues 

that are coming out of this process, but I can tell you in Georgia, 

ObamaCare is not real popular. We are having major problems 

down there. 

In fact, most physicians I meet with say that nothing’s changed. 

Emergency rooms: people show up still without health insurance. 

They see very few patients. You might check with some of the hospitals. You know, their elective surgeries are off something like 80 

percent because of the high deductibles, so just, you know, one 

problem after the other. But what I want to zero in on is this 

Planned Parenthood thing. 

And I would like some commitment from you here today on when 

your Department will conduct an investigation on this very, very 

serious matter. Not only is it unconscionable, but they are breaking 

the law, and it’s a big issue with the people of this country. I mean, 

it’s what I hear about every day, what are we going to do about 

this? Can you tell me when we going to do something about that? 

Secretary BURWELL. I do want to—just one moment on your Affordable Care Act— 

Mr. ALLEN. Yeah. 

Secretary BURWELL.—and that issue. And the question of expansion in a State like yours, and what we see in Arkansas is we’ve 

seen as a percentage drop the number of uninsured that are coming in emergency rooms, we’ve seen actually a dramatic drop, and 

so, as a part of the issue there and how we think about rural hospitals, which I know are an important issue in your State as they 

are in my home State. 

With regard to the Planned Parenthood issue, as I’ve said, this 

is an important issue and one that there is passion and emotion 

and belief on many sides of the issue, and I want to respect that. 

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With regard to our funding, I think you know we do not fund 

abortions as the Federal Government except for the Hyde exceptions, which have been in place for many years. Our funding for 

Planned Parenthood is in another issue space. With regard to the 

issue you raised, which is a question of whether it’s a legal issue, 

and there are laws and there are statutes that guide the use of 

fetal tissue that are in place and should be enforced. 

With regard to investigating or looking into those issues, as I 

said, because it is a statutory legal issue, the Department of Justice and the attorney general has said she has taken those issues 

under review and will determine what the appropriate next step is. 

Mr. ALLEN. And that would include your investigation? I mean, 

it should be like all hands on deck on this thing. 

Secretary BURWELL. With regard to the question of a legal matter, and you know, I defer to our colleagues at the Justice Department, we will support them in anything they need or want from us, 

and we always do that, but with regard to making those decisions 

of the question of an investigation of a legal matter— 

Mr. ALLEN. So you don’t have personnel that can look into this? 

Secretary BURWELL. With regard to what we do we have at the 

Department of HHS is, this is not an issue in terms of us funding 

this specific issue. When we do have issue— 

Mr. ALLEN. You deal with Medicare fraud. 

Chairman KLINE. The gentleman’s time has expired. 

Mr. DeSaulnier. 

Mr. DESAULNIER. Thank you, Mr. Chairman. Thank you, Madam 

Secretary. Briefly, on the issue of Planned Parenthood, as I understand it, there are multiple investigations in California. The State 

attorney general is investigating the issues, including if the people 

who actually took the film violated the law. 

But I have two areas for questions for you. One is your work on 

prescription drug abuse. As my colleague from Georgia mentioned, 

it’s a very large issue, 45 Americans die a day, according to the 

Center for Disease Control. The U.S. has less than 5 percent of the 

world’s population, but we consume over 80 percent of the opioids 

in the world. It’s a huge cost issue both financially and from the 

human side. 

So in California, we are switching to an electronic monitoring 

system. It’s been getting up, and even people who question it are 

starting to support it. So my question is, what are things that you 

might think—and I’ll ask both questions and let you go, given the 

time constraints, that we might be able to do on a Federal level to 

help States like California, New York, and Georgia. 

And then secondarily, coming from a high cost State where we’re 

very proud of the ACA in California, sort of the opposite side of 

what one of my colleagues brought up being from the Bay area, 

provider rates and attracting primary care physicians, so if you 

could address those two things quickly, I would appreciate it. 

Secretary BURWELL. I’m sorry, the second issue? 

Mr. DESAULNIER. The second question was the opposite side of 

high cost States and reimbursements rates, and then because of 

that, we’re having a difficult time attracting primary care physicians in California, particularly young people to go into that field. 

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Secretary BURWELL. On the primary care, let’s just start there, 

in terms of how we are structuring our graduate medical education 

proposal in this budget, it is actually to focus funding for GME on 

places like primary care and rural districts where we have shortages and other specialties. So what we’re trying to do is use our 

tools at hand to encourage people to go into those specialties and 

create more of a pipeline to go to places. 

With regard to the issue of prescription drug abuse, 250 million 

prescriptions in one year in the United States. That is enough for 

every adult in the country. This is an acute problem. One, prescribing it. I think that number itself tells you something about we 

got to go after prescribing. The congressman’s comments about 

PDMPs, prescription drug monitoring program, essential, get those 

up, get those working in the States. 

That’s a lot of what I’m spending my time in conversations with 

governors, whether Governor Baker in Massachusetts or 

Hickenlooper, in Colorado, been to visit both. 

Second is access to Naloxone. Naloxone is the drug that when 

someone is in overdose, actually saves their life, and so the question of how that’s accessed is a very important thing in creating in 

a State-by-State basis. 

The third is medicated assisted treatment, and for all those who 

are addicted, trying to get that transition. I met a woman in Colorado who has been clean four years, and her journey there from 

having her wisdom teeth taken out, becoming addicted and going 

to heroin is a journey we don’t want people to travel, and so getting 

that medicated assisted treatment and those other things in place 

are three specific evidence-based approaches. 

Mr. DESAULNIER. Thank you, Madam Secretary. Thank you, Mr. 

Chairman. 

Chairman KLINE. I thank the gentleman. 

Mr. Bishop, you’re recognized. 

Mr. BISHOP. Thank you, Mr. Chairman. 

Thank you, Madam Secretary, for being here today. I appreciate 

your testimony and the discussion. I know there are a dozen windows that are opened up right now, but I’d like to talk to you specifically about the exchange enrollment issues that I’m seeing in 

my office. 

It’s an ongoing concern I’m hearing from constituents, and I want 

to make sure while I have your attention, that I address the concern. 

The Government Accountability Office recently put out an alarming report highlighting various shortcomings of Healthcare.gov, 

which resulted in numerous fictitious enrollees gaining access to 

coverage and subsidies paid by the American taxpayers. In the 

meantime, as I said, I’ve heard from any of the number of my constituents, one anecdote after the next, very frustrated with regard 

to how this is working, purchased or tried to purchase on the Web 

site insurance, only to have their coverage canceled because of a 

minor mistake they made on their application. 

And by the time they get to me, they are furious, and I can’t say 

that I blame them. As a parent, who has a family and is expected 

to provide for my family, my heart goes out to them, but it becomes 

me being the reason why. 

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They also have problems getting the issue corrected and lackluster communication with the Department, how we can correct the 

issue, long wait times, there is just so many issues with regard to 

this. And GAO’s information suggests that significant fraud is 

being—is being rewarded, while at the same time some of these 

minor mistakes are being punished. I’m wondering what we can do 

to address that if you’ve had this same communication from other 

members, if we’re addressing them, and if you could just quickly 

comment on that. 

Secretary BURWELL. So first of all, with regard to the communication coming into your office, please reach out, reach out to me 

directly, let’s work on those individuals and work through those individual issues, so please make sure, just reach out to us, our office, we will work on those. 

Mr. BISHOP. Okay. 

Secretary BURWELL. With regard to, though, actually it’s both 

sides of the coin because the GAO, we don’t actually know. We 

don’t know when they falsified, whether they falsified a Social Security or what, the small issues. What we’re trying to do is program integrity, and that’s what your folks are getting caught in because they have done that, and we’re doing it in a strict way. 

That’s what people are feeling is because we are trying, if you do 

not provide the data that’s required to say your income is X or to 

say that you are of a certain status, that you know, that’s what’s 

happening to the examples. 

And so actually, we don’t exactly know because the GAO hasn’t 

told us what those examples are. Those are actually two very related things in terms of us doing the program integrity that we’re 

being asked for. We don’t know that the examples of the GAO are 

more than the examples that you’re talking about. 

When we get to recommendations, we may know that, but at this 

point, we don’t, and so right now, what we’re doing is trying to do 

program integrity, but we want to make sure that if there are individuals—because many of the people are like you said, we don’t 

have the right information but they still may be eligible, so please 

let us know about those examples. 

Mr. BISHOP. Thank you, Madam Secretary. I yield back. 

Chairman KLINE. Thank you. The gentlewoman, Ms. Wilson. 

Ms. WILSON of Florida. Thank you, Mr. Chair. I ask unanimous 

consent that the Office of the Assistant Secretary for Planning and 

Evaluations’ research brief showing that increases in cost sharing 

can discourage low income individuals from accessing necessary 

medical care which can have negative health consequences be entered into the record. 

Chairman KLINE. Without objection. 

[The information follows:] 

[Additional Submissions by Ms. Wilson follow:] 

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Ms. WILSON of Florida. Secretary Burwell, thank you so much for 

being here today and for working with Florida, especially, and our 

head start and elder care and all of the other things that you do. 

I appreciate your testimony on how ObamaCare is working for the 

American people, and I call it ObamaCares, because I believe that 

Obama cares about the people of this Nation, and that’s why we 

have this healthcare law. 

It’s here to stay. It’s the law of the land. The people of Florida 

are much better off because of this. We have led the Nation in new 

enrollments through the Federal exchange. My district Florida—in 

my District 24 has the third highest number of people in the Nation who benefit from subsidies. Unfortunately, we have not expanded Medicaid, but I thank you for your commitment to working 

with the Florida legislature and the governor to expand Medicaid, 

and consider me as a partner in this pursuit and hopefully for a 

better outcome in the future. I also want to thank you for helping 

securing low income pool funding for Florida. That was very special 

to us. 

I want to thank you for your testimony on the importance of investment in high quality early learning, so I commend you and the 

President for your commitment to expanding and investing in early 

education. I have several questions. I want to try to combine them 

in one. 

The President’s budget includes an additional $1.5 billion to improve quality head start. Why is this crucial? What is head start 

doing to ensure that all head start children and early childcare are 

eligible, have access to high quality early learning? What is at 

stake if our Nation ignores the ever growing body of research? And 

can you describe how the revised program performance standards 

will help, and can you please speak to the negative impact of 

spending caps? 

Secretary BURWELL. So I will try and get through as many of 

those as I can with our time. One is with regard to the changes, 

there are a number of changes that are part of the proposal, and 

they are about using the evidence with regard to extending the day 

and the question of extending the year, but there are other important changes in terms of what curriculum should be used in terms 

of the teachers and those participating. 

There are also a number or safety issues, making sure that the 

grantees and others that are doing the services do it in a safe way. 

We also try to reduce the bureaucracy to make it easier for people 

to come in and apply and be a part of that system. So we put the 

money in the budget to match the changes that we have proposed 

as we go forward. 

With regard to the ramifications— 

Chairman KLINE. I’m sorry; the gentlelady’s time has expired. 

Mr. Messer. 

Mr. MESSER. Thank you, Mr. Chairman. Thank you, Secretary 

Burwell, for being here. I’d like to talk a little bit about the 49’er 

phenomena under the Affordable Care Act, the idea that the Affordable Care Act only applies to businesses of 50 or larger, and so 

there’s has been questions about some businesses staying at that 

49 threshold, not being willing to hire that 50th person because 

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they would make themselves subject to all the mandates and requirements of the President’s healthcare law. 

The administration has helped ease that burden somewhat by 

delaying that 50 figure by making it up to 100 so that businesses 

that were 100 and less wouldn’t be forced to —wouldn’t be required 

to comply with the law. 

Could you talk a little bit about the rationale of lifting that to 

100? Why was it businesses 100 and less that the administration 

said wouldn’t be subject to the law up until 2016? 

Secretary BURWELL. So I think there are also two different issues 

in terms of application proportions of the law. 

Mr. MESSER. Yeah. 

Secretary BURWELL. And some of those have to do with what 

benefits but also what category, and so I’m not sure if you’re— 

Mr. MESSER. Like the employer mandate example. You’re not— 

Secretary BURWELL. If it’s a question of the category in terms 

of— 

Mr. MESSER. You’re not subject to the employer mandate under 

your delay until—for businesses of 100 or less until 2016. I’m just 

trying to get at what was it that made you decide to lift it to 100 

from the 50. 

Secretary BURWELL. So with regard to that issue, it is that, you 

know, 96—you know, as we look at the number of employers, and 

even when we go to those higher levels, I think we believe that employers at that level should be providing that type of care and can 

do that, and we can do that in a way that you can do it if there 

are pooled markets in affordable ways, and that’s what we believe 

that can be done because we want to make sure that small businesses that have this— 

Mr. MESSER. But to the precise question of why you lifted it from 

50 to 100, why was it that you guys said businesses 100 and less 

could be delayed until 2016? Because the law says 50 and less. 

Secretary BURWELL. So, just want to make sure you’re referring 

to which piece, because we’ve already had a conversation earlier, 

I think you heard about a particular question of the provision, of 

whether or not 50 to 100 applies to whether those small businesses, which market they will be, and those are two different 

things. 

Mr. MESSER. Again, I’m reclaiming my time because I only have 

so much time. I think it’s clear that you guys have acknowledged 

that businesses of 100 and less are small businesses that make it 

difficult to comply with all the elements of this law. I’ve actually 

introduced legislation, H.R. 2881, the Small Business Job Protection Act of 2015 that would make that level of 100—businesses of 

100 employees and less—the permanent standard under the law, 

just essentially continuing the delay that you guys moved in to 

2016. 

It’s not really a trick question. I think that the reality is, is that 

there are a lot of very small businesses of that 50 or less employees, and the mandates and requirement of this law are difficult to 

comply with. I think businesses of 100 and less—while I’d like to 

see the mandate go away entirely—they’re at least a different kind 

of business than a business of 50 and less. Appreciate your testimony. 

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Secretary BURWELL. Thank you. 

Chairman KLINE. The gentleman’s time is expired. 

Mr. Polis. 

Mr. POLIS. Thank you, Madam Secretary. Back in April I had the 

opportunity to visit the head start program at the Wilderness Early 

Learning Center in Boulder, and I’ve seen firsthand the benefits 

head start can provide for kids and communities. 

As you know, head start’s grants are given to nonprofits, community centers, and often traditional public schools, but to my knowledge, no charter schools have ever received head start grants and 

very few have applied. Can you talk about what your agency is 

doing to clarify guidance so that charter schools, which are public 

schools that have the autonomy to offer unique curriculum for students, know that they’re eligible to apply for head start grants and 

understand how to meet head start requirements? 

Secretary BURWELL. This is an issue I’m not familiar with in 

terms of charters and application for head start, so one we’ll have 

to get back to you. 

Mr. POLIS. Great. We’d be happy to hear from you about a specific plan to make sure that charter schools are aware of the opportunity to apply and what they need to do. 

Earlier this year, as you know, the FDA published revised recommendations pertaining to blood donations by gay men. The policy change eliminated the lifetime ban and replaced it with a one 

year deferral policy, which on the margins can save a few more 

lives. 

While it’s a positive step forward, I’m hoping you can speak 

about your opinion of whether the new policy truly reflects the 

most up-to-date science on the issue. As you know, the large majority of gay men don’t engage in risky behavior and are not at higher 

risk of contracting HIV than the general population. In fact, the 

FDA’s own blood drive survey found that the prevalence of HIV in 

gay male blood donors, was just .25 percent, actually lower than 

the overall prevalence of HIV in the total U.S. population, which 

is .38 percent. 

Would the FDA consider a policy that screens for specific risky 

behavior rather than grouping all gay men into one black blanket 

high risk category? 

Secretary BURWELL. With regard to the policy that we have announced, we’ve tried to move the policy forward based on the scientific evidence that we have in front of us, both with regard to 

issues of self-reported monogamy as well as the penetration of HIV 

in particular populations. We always welcome the additional— 

Mr. POLIS. I believe it’s self-reported abstinence, not self-reported 

monogamy; is that correct? 

Secretary BURWELL. I will have to check exactly what is the selfreported—my indication. 

Mr. POLIS. I think if we could move for it, would you be supportive of moving to self-supported monogamy? 

Secretary BURWELL. What we are always open to is reviewing 

evidence in terms of the decisions that we’re making in this space. 

We believe that the decisions that we’ve made at this point are evidence based. If there’s additional evidence that we should know 

about, we always welcome it. 

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Mr. POLIS. Well, I’m looking forward to your implementation of 

the self-reported monogamy recommendation, which I am certainly 

in strong support of, as an indication of risky behavior, certainly 

in those who are in monogamous or married relationships would be 

at much lower risk than those who are not, and I yield back. 

Chairman KLINE. The gentleman yields back. 

Ms. Stefanik. 

Ms. STEFANIK. Thank you, Mr. Chairman, and thank you, 

Madam Secretary, for your testimony today. 

The President’s healthcare law mandates certain employers provide healthcare coverage to their employees and will soon tax employers if that coverage is too generous. And Section 1511 of the 

healthcare law requires employers to automatically enroll new employees and continue enrolling current employees into their 

healthcare coverage, giving employees only a very small window to 

choose to opt out. 

This mandate takes away the ability for employees to choose coverage that best meets their needs, and it could result in a loss of 

take-home pay to cover possibly more expensive health insurance 

than they otherwise would not have chosen. 

I’ve introduced H.R. 3112, the BE OPEN Act to eliminate this 

harmful and unnecessary provision. But could you specifically discuss whether mandatory auto-enrollment can trigger individual 

mandate penalties for employees receiving subsidized exchange 

coverage? 

Secretary BURWELL. With regard to the specific of that implementation issue, that is an issue that I would defer to my colleagues at Treasury. The implementation of the tax portion that I 

think is within the context of what you’re referring to is a Treasury 

issue. I think, as you probably know, we have guidance out for 

comment right now, and so with regard to the specifics of that, 

that’s a place where I would defer to my colleagues with Treasury, 

and we can take that question and give it to them. 

Ms. STEFANIK. Let me ask this question a different way. What 

about those employees who become enrolled in double coverage because of this mandate and they miss the 90-day window in which 

to opt out? Should those employees, in your opinion, be penalized 

by paying multiple premiums because of a requirement imposed on 

by employers in the ACA? 

Secretary BURWELL. With regard to the specifics of this question 

in terms of the detail of how it would be implemented, I would 

want to know and understand what the implementation is that the 

Treasury is thinking with regard to this issue, so I’d want to coordinate with my colleagues at Treasury. 

Ms. STEFANIK. Sure. I look forward to getting a response from 

the Department of Treasury, but I also believe that this is duplicative and it’s an unnecessary mandate requiring employers to automatically enroll employees into health plans where they have little 

choice and sometimes they don’t have knowledge of that. 

So I understand you want to defer to the Department of Treasury, but I think it’s an important broken aspect of the ACA where 

I’d like HHS’ feedback on. I yield back. 

Chairman KLINE. The gentlelady yields back. 

Mr. Jeffries. 

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Mr. JEFFRIES. I thank you, Mr. Chair, and thank you, Madam 

Secretary, for your testimony here today as well as for your tremendous leadership. 

I want to begin by asking a question about sort of providing care 

to some of the most disenfranchised, economically isolated individuals, in this particular case, many of the constituents that I represent. Over the last several years, we’ve had a crisis throughout 

Brooklyn with the closure of several safety-net hospitals, and in 

other instances, significant financial distress that many of these 

safety-net hospitals have experienced, largely as a result of perhaps 

the overutilization of certain aspects of the hospital, the emergency 

room for issues that can be taken care of in a primary care context. 

And for instance, the fact that, traditionally, in many 

socioeconomically disadvantaged communities, you’ve got a mix of 

individuals who are either on Medicaid or totally indigent and uninsured, the access to private insurance traditionally has not been 

a healthy mix, and it’s created a situation where many of these 

safety-net hospitals are under severe financial distress. 

That’s beginning to change given the onset of the Affordable Care 

Act, which is tremendous, but there’s still, I think, is an effort to 

begin to direct individuals more into the primary care context and 

away from the overutilization of these safety-net hospitals. Could 

you speak more about that, what the administration is doing and 

where you think we need to go? 

Secretary BURWELL. So one of the things that the administration 

is doing is part of the overall effort. There are many new people 

who are newly insured, and the actual employee-insured based population has many new—access to many new services in terms of 

prevention. 

And so at CMS, one of the things we are working on is something called, ‘‘Coverage to Care,’’ and it’s both for those that are 

newly insured, but it’s also for those that are in the insurer base 

market to help people understand how to use that coverage to access a primary care physician, to get a health home so that we can 

start to solve some of these issues and to do things as simple as 

some people, and even in the employer-based market, understanding your bill. Those kinds of things are often complicated and 

difficult to do. 

So at CMS, we are having a program. We are working on it. We 

want to use the resources that are part of the teams that have 

helped get people insured to make sure we’re moving that information. It comes back also to that Medicare point I raised earlier that 

many people in Medicare don’t know that they can get access to 

these services without copays. So we want to focus on greater education to get people into those primary care settings. 

Mr. JEFFRIES. And is enhanced Medicaid reimbursement for primary care services also a part of what can be helpful moving forward? 

Secretary BURWELL. It is. And as you know, we’ve proposed to 

extend that. 

Mr. JEFFRIES. Thank you. I yield back. 

Chairman KLINE. The gentleman yields back. 

Mr. Brat. 

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Mr. BRAT. Thank you, Mr. Chairman. Thank you for being with 

us today. I have two quick questions. I guess I just got dinged from 

five minutes down to three, so I’ll make it real quick. 

On ObamaCare overall: productivity, claims that it’s good for the 

economy. The basics in 2014, CBO reported they expect 

ObamaCare will result in a 2.5 million person job reduction and 

full-time equivalent employment by 2024. And so if you do the 

math on that, 2.5 million people times 40 hours a week is 100 million hours, and then you do that for the year, and you get 100 million times 50 weeks in a year, and you are at five billion hours in 

labor productivity gone due to this single program, and that’s the 

response I get when you walk door-to-door, small business to small 

business, from people on the street is like we can’t hire anybody, 

this is devastating us, and so I’ll ask for your remarks on that. 

The economy is already struggling to keep up with a kind of a 

2 percent rate, if that, and so the claim that the program is good 

for the economy, I struggle with. And then secondly, I’ll just ask 

you a quick one and ask for your response. At the micro-level, I 

have constituents who have approached me with concerns about 

FDA’s proposed rules to regulate premium cigars. 

Premium cigars don’t have youth access issues, sold in adult establishments. The specific goal of the Tobacco Control Act were to 

limit youth access and prevent negative health effects from habitually used products, neither of which apply to premium cigars. 

So, shouldn’t the FDA leave this category out of regulations? By 

the FDA’s own estimation again, over half of premium cigar stores 

and manufacturers will be shut down if FDA chooses option one in 

the proposed regulation. And so on this level, too, how do you justify the regulation when it’s eliminating so many jobs and will have 

such a great impact on my constituents? 

Secretary BURWELL. With regard to the premium cigar issue, I 

think one of the things we asked for was the evidence, the evidence 

with regard to child use, and so, that’s why we put out two different proposals. As we review that, it is about the evidence we receive with regard to the question of premium cigars and child use, 

getting to the core part of the statute that you articulated, and 

we’ll continue to work on that. 

With regard to the broader economic issues, I think in that same 

CBO report, what we do know is the reflection of what happens in 

the out years with the Affordable Care Act in terms of why there’s 

long-term deficit reduction and it’s also both about productivity as 

well as cost, and we see large numbers in terms of those out years, 

and so as that works through the system. 

I think the other thing is we think about these issues of jobs and 

job creation. We know that we have had the longest stretch of job 

creation as a Nation in terms of constant stretch of job creation. 

And the other thing that we see in that is we have not seen any 

rise in the number of people who are looking for, you know, at that 

40-hour level. 

Mr. BRAT. Let me ask you on that. The generic phrase, ‘‘we have 

seen an increase in jobs,’’ isn’t consistent with the clear evidence 

that the workforce participation rate is at its lowest in history, so 

yes, I mean, we’re gaining jobs, the population is bigger, but the 

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labor force participation rate is at it’s all time low, can those be 

squared? 

Chairman KLINE. I’m sorry; the gentleman’s time has expired. 

We’re jamming up against the clock here. 

Mr. BRAT. Thank you. 

Chairman KLINE. Mr. Takano. 

Mr. TAKANO. Thank you, Mr. Chairman. 

Madam Secretary, I understand that my colleague from California, Mr. DeSaulnier asked you about graduate medical school 

education. I just want to associate myself with those remarks. In 

Riverside County, which I represent, there are about only 34 primary care physicians for every 100,000 people, half the number of 

doctors needed to provided adequate access to care. And I understand that the GME levels have been frozen under the Medicare 

and Medicaid budgets since around 1996, so I associate myself with 

the exchange. 

I hear from many of my colleagues about rising healthcare costs, 

and Mr. Courtney of Connecticut commented on the slow rates of 

growth there. In that case, it’s a good thing. The Affordable Care 

Act is bending the cost curve. Last year, healthcare spending grew 

at the slowest rate on record since 1960, and healthcare price inflation is at its lowest rate in 50 years. 

Just this week, as you mention in your testimony, California released its premiums for the 2016 planned year. Statewide, the average increase in premiums is just 4 percent. It’s even lower than 

last year and a far cry from the years of double-digit premium 

growth we had before the ACA. Covered California also announced 

that if consumers shop around, they can reduce their premium by 

an average of 4.5 percent. That’s incredible. 

Madam Secretary, can you share more about how the ACA is 

containing healthcare costs? 

Secretary BURWELL. I think you’ve outlined a number of the 

places that it is in terms of that downward pressure on premiums 

and also what happens in competition, your point that people can 

go on the marketplace and shop in the individual market. 

We have also seen some of that downward pressure in overall 

price. It’s also in the employer-based market. And the only other 

piece that I would mention is I think it’s important to reflect that 

we’ve had a reduction of $317 billion in the projected Medicare 

spending from the period of the passage. 

Mr. TAKANO. Real quick, before my time is up, how many years 

has the solvency of the Medicare trust fund been extended thanks 

to the ACA? 

Secretary BURWELL. It is I want to say 17. It’s at 2030, and when 

we came in, it was in the 2017, 2019 range. 

Mr. TAKANO. So it’s increased—with increased— 

Secretary BURWELL. Thirteen to 17 years. 

Mr. TAKANO. By 17 years. 

Secretary BURWELL. Thirteen to 17. I want to go back and check 

exactly. It is 2030, and I think that previous number—I just don’t 

know what the previous historical number was. 

Mr. TAKANO. So the cost containment seems to be working, and 

I congratulate, you know, all of us for standing by the law. And I 

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know there’s much more that we need to do to fix it. And I’m going 

to run out of time, I’m pretty sure, so Mr. Chairman, I yield back. 

Chairman KLINE. The gentleman yields back. 

Ms. Clark. 

Ms. CLARK. Thank you, Mr. Chairman, and thank you, Madam 

Secretary, for being here today. I appreciate your leadership in so 

many areas, especially early childhood education and access to affordable high quality healthcare for all Americans. 

Today I want to focus in my brief time on a topic that has come 

up with my colleagues from Georgia and California around the 

opioid crisis, and I commend you for your recent announcement 

and hope that Congress will support the 100 million that you want 

to invest in this crisis. 

As you know, it doesn’t matter when it comes to opioid abuse, 

whether you are rich or poor, your level of education attainment, 

but an area where we are seeing growth is in women using heroin, 

which has more than doubled in the last decade. 

I introduced legislation called, Protecting Our Infants Act, which 

focuses on care for babies that are being born dependent to opiates, 

but it also looks at the effectiveness of programs specifically aimed 

at women and helping with substance abuse disorders. 

Can you discuss any efforts that you have made to evaluate and 

respond to the circumstances of unique populations, including 

young women and others, in addressing this crisis? 

Secretary BURWELL. With regard to, I think that it is especially 

important for young women, especially pregnant young women, to 

get into medicated assisted treatment quickly. And, actually, just 

a week ago, I was in Colorado visiting a clinic that did this work. 

And they do it, obviously, they do medicated assisted treatment, 

but they are an integrated facility so that a woman can come work 

on these issues at the same time she gets her prenatal care in a 

facility that is all in one place. 

And so the emphasis and importance on medicated assisted 

treatment is something that we believe is a key part with this type 

of population, especially the pregnant women, so that we’re protecting that newborn. 

Ms. CLARK. Another area, shifting gears, but still talking about 

pregnant women and new moms, is the issue of postpartum depression. 

Secretary BURWELL. Yes. 

Ms. CLARK. I just dropped a bill today looking at this, hoping to 

expand grants to States. one in seven new moms are going to experience this depression. Can you talk about your efforts in this area, 

and what you think we can do to improve screening and access to 

treatment? 

Secretary BURWELL. We believe that this is an essential part of 

prenatal and maternal care. As part of the prenatal care, making 

sure people know and understand this issue. We believe it’s part 

of the full integration of behavioral health, and that’s something 

that was done through the Affordable Care Act; it’s something that 

was done in terms of the Mental Health Clarity Act, and making 

sure that we bring the—so it’s all about maternal care. It’s not 

about one or the other. This is an element of maternal care. 

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And so making sure that we have the right wellness visits and 

the right questions being asked as part of those wellness visits, and 

that is the integrated care that we believe is part of delivery system reform across the board. 

Ms. CLARK. Thank you. 

I yield back. 

Chairman KLINE. I thank the gentlelady. 

Mr. Curbelo, you are wrapping up here. You are recognized for 

three minutes. 

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

And thank you, Madam Secretary, for your time and for your testimony here today. 

The rising costs of healthcare coverage remains a major issue for 

people in my community. I’m talking employers and employees. 

And one issue that’s starting to come onto people’s radars is the 

Cadillac tax, the 40 percent tax on so-called high-cost plans has resulted in many employers already making changes to their plans 

to avoid hitting the tax in 2018 because, at the same time, they 

also have to offer minimum value coverage to avoid an employer 

penalty. So, it’s a careful balancing act that a lot of employers are 

trying to make. 

According to Towers Watson, 84 percent of large businesses surveyed expect to make changes to their full-time employee health 

benefits over the next three years. We hear stories now of how employers are making plan design changes such as increasing cost 

sharing and narrowing provider networks. 

Miami-Dade County Public Schools, the second largest employer 

in the State of Florida, reported to me that they could see devastating effects as a result of this tax from an estimated $500,000 

impact in 2018 up to a $10 million impact in later years. 

Madam Secretary, if we are concerned about the costs of coverage, wouldn’t it make sense to get rid of this excise tax because 

it’s forcing the costs of coverage to go up for employees? Shouldn’t 

the answer be to get rid of it and allow employers to offer the 

health benefits their employees are requesting and willing to pay 

for? 

I really see this as one of those examples where the government 

actually ends up hurting the people who most need the help. When 

you’re talking Miami-Dade County Public Schools, it’s a lot of 

teachers; it’s a lot of low-income earners, and now they face losing 

their health insurance or seeing fewer healthcare benefits as a result of this tax. Could you share some of your views on this issue? 

Secretary BURWELL. Yes. One of the things is that for those populations and for those communities, the types of increases that we 

were seeing in terms of the percentage increase in premiums already existed. Some of the shifts that you’re talking about in terms 

of how companies are doing cost sharing and their networks and 

deductibles, those things were occurring already. 

By having the downward pressure of the excise tax in terms of 

the question of people’s interests and companies and other employers’ interests in trying to control their healthcare cost, we believe 

it’s something that actually does put downward pressure on overall 

costs. I think the other issue at hand that we all have to consider 

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with regard to this excise tax is the Federal deficit and the question of any changes and how it interrelates with the Federal deficit. 

So, those are the two issues that I think come to the floor. The 

question of whether or not overall it has downward pressure on 

prices and then the second is the fiscal responsibility. 

Mr. CURBELO. But do you have any concern for those low-income 

earners who don’t make a lot of money but at least for many years 

and I can speak as a former board member of Miami-Dade County 

schools, they knew that they had a good healthcare plan that they 

and their family members could rely on. They may lose those plans. 

Is that a concern for you? 

Chairman KLINE. I’m sorry. The gentleman’s time has expired. 

We are exceeding the hard stop time. 

I’d like to recognize Mr. Scott for any closing remarks that he 

has. 

Mr. SCOTT. Thank you, Mr. Chairman. 

Could I ask one question— 

Chairman KLINE. Please. 

Mr. SCOTT. Just a brief question. My distinguished colleague 

from Virginia asked about people who might lose their job because 

of the Affordable Care Act. Could you make a quick comment about 

the effect of job lock and how that creates the situation you referred to? 

Secretary BURWELL. Just that the question of job lock and those 

numbers have to do with many people are going to make a choice 

to start their own business. 

I think the other thing in terms of job creation as I said with the 

Medicaid numbers, what we see is increased jobs because of some 

of the changes. 

Mr. SCOTT. And so when you talk about people leaving the job, 

that’s because they were only working on the job because they had 

a preexisting condition and wouldn’t have insurance before, and 

they count that as a bad thing that they have another choice to 

leave their job I think is not looking at the positive effect that the 

Affordable Care Act has. 

And so I want to thank you for talking about the President’s priorities, especially healthcare, early childhood education, the effect 

of sequester on all of your programs, and I look forward to working 

with you as we go forward with the budget. 

Secretary BURWELL. Thank you. 

Chairman KLINE. I thank the gentleman. 

Madam Secretary, I just have a quick follow-up to clarify an earlier question you were asked about Planned Parenthood. I know 

that came up a couple of times as you pointed out an issue that 

there’s a lot of passion. I just want to be clear, is it your testimony 

that the Department of Health and Human Services has no intention of looking into this matter? 

Secretary BURWELL. What the Department of Health and Human 

Services will do, and we didn’t discuss it today, is with regard to 

the issue of our grantees and the Department of NIH, part of HHS 

that does our research, there’s funding with regard to grantees, 

and some of those grants actually use fetal tissue. With regard to 

that, what we are doing is making sure that what we do have in 

place, which is clarity around the issue of the fact that for any of 

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those grantees that are going to do that research, that as they 

come through the process and before we do the grant making, there 

are terms and conditions that clearly list what the law is with regard to fetal tissue. They need to assert and certify that they understand the laws and that they will abide by that. 

And then on an annual basis, with regard to when they re-up the 

grants, we ask them to certify, again, that they will obey the laws 

and the terms and conditions of which this is a specific place. 

So, with regard to the piece that interacts with the Department, 

these are steps that we are taking to make sure that we have appropriate procedures in place to make sure that people know the 

law and certify that they are abiding by it. 

Chairman KLINE. And so, the activities which have been so important to so many of us that have been revealed in these videos 

that are the actions of Planned Parenthood, you believe that is 

solely a matter for the Department of Justice; is that correct? 

Secretary BURWELL. With regard to the determination of if the 

law has been broken, that is the Department of Justice. If there 

are any concerns at all with our grantees, we would want to refer 

that to our IG and/or the Department of Justice, depending on 

those circumstances. 

Chairman KLINE. Okay. Thank you. 

I really want to thank you. You were very indulgent here. We 

have gone over by eight minutes. I appreciate your patience. We 

very much appreciate your coming today. And there being no further business, we’re adjourned. 

Secretary BURWELL. Thank you, Mr. Chairman. 

[Questions submitted for the record and their responses follow:] 

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[Secretary Burwell’s response to questions submitted for the 

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[Whereupon, at 12:08 p.m., the committee was adjourned.] 

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