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95–372 2016

EXAMINING THE FISCAL YEAR 2016 HHS BUDGET 

HEARING 

BEFORE THE

SUBCOMMITTEE ON HEALTH 

OF THE

COMMITTEE ON ENERGY AND 

COMMERCE 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED FOURTEENTH CONGRESS 

FIRST SESSION 

FEBRUARY 26, 2015 

Serial No. 114–13 

( 

Printed for the use of the Committee on Energy and Commerce 

energycommerce.house.gov 

(II) 

COMMITTEE ON ENERGY AND COMMERCE 

FRED UPTON, Michigan 

Chairman 

JOE BARTON, Texas 

Chairman Emeritus 

ED WHITFIELD, Kentucky 

JOHN SHIMKUS, Illinois 

JOSEPH R. PITTS, Pennsylvania 

GREG WALDEN, Oregon 

TIM MURPHY, Pennsylvania 

MICHAEL C. BURGESS, Texas 

MARSHA BLACKBURN, Tennessee 

Vice Chairman 

STEVE SCALISE, Louisiana 

ROBERT E. LATTA, Ohio 

CATHY MCMORRIS RODGERS, Washington 

GREGG HARPER, Mississippi 

LEONARD LANCE, New Jersey 

BRETT GUTHRIE, Kentucky 

PETE OLSON, Texas 

DAVID B. MCKINLEY, West Virginia 

MIKE POMPEO, Kansas 

ADAM KINZINGER, Illinois 

H. MORGAN GRIFFITH, Virginia 

GUS M. BILIRAKIS, Florida 

BILL JOHNSON, Ohio 

BILLY LONG, Missouri 

RENEE L. ELLMERS, North Carolina 

LARRY BUCSHON, Indiana 

BILL FLORES, Texas 

SUSAN W. BROOKS, Indiana 

MARKWAYNE MULLIN, Oklahoma 

RICHARD HUDSON, North Carolina 

CHRIS COLLINS, New York 

KEVIN CRAMER, North Dakota 

FRANK PALLONE, JR., New Jersey 

Ranking Member 

BOBBY L. RUSH, Illinois 

ANNA G. ESHOO, California 

ELIOT L. ENGEL, New York 

GENE GREEN, Texas 

DIANA DEGETTE, Colorado 

LOIS CAPPS, California 

MICHAEL F. DOYLE, Pennsylvania 

JANICE D. SCHAKOWSKY, Illinois 

G.K. BUTTERFIELD, North Carolina 

DORIS O. MATSUI, California 

KATHY CASTOR, Florida 

JOHN P. SARBANES, Maryland 

JERRY MCNERNEY, California 

PETER WELCH, Vermont 

BEN RAY LUJA ́ N, New Mexico 

PAUL TONKO, New York 

JOHN A. YARMUTH, Kentucky 

YVETTE D. CLARKE, New York 

DAVID LOEBSACK, Iowa 

KURT SCHRADER, Oregon 

JOSEPH P. KENNEDY, III, Massachusetts 

TONY CA ́ RDENAS, California 

(III) 

SUBCOMMITTEE ON HEALTH

JOSEPH R. PITTS, Pennsylvania 

Chairman 

BRETT GUTHRIE, Kentucky 

Vice Chairman 

ED WHITFIELD, Kentucky 

JOHN SHIMKUS, Illinois 

TIM MURPHY, Pennsylvania 

MICHAEL C. BURGESS, Texas 

MARSHA BLACKBURN, Tennessee 

CATHY MCMORRIS RODGERS, Washington 

LEONARD LANCE, New Jersey 

H. MORGAN GRIFFITH, Virginia 

GUS M. BILIRAKIS, Florida 

BILLY LONG, Missouri 

RENEE L. ELLMERS, North Carolina 

LARRY BUCSHON, Indiana 

SUSAN W. BROOKS, Indiana 

CHRIS COLLINS, New York 

JOE BARTON, Texas 

FRED UPTON, Michigan (ex officio) 

GENE GREEN, Texas 

Ranking Member 

ELIOT L. ENGEL, New York 

LOIS CAPPS, California 

JANICE D. SCHAKOWSKY, Illinois 

G.K. BUTTERFIELD, North Carolina 

KATHY CASTOR, Florida 

JOHN P. SARBANES, Maryland 

DORIS O. MATSUI, California 

BEN RAY LUJA ́ N, New Mexico 

KURT SCHRADER, Oregon 

JOSEPH P. KENNEDY, III, Massachusetts 

TONY CA ́ RDENAS, California 

FRANK PALLONE, JR., New Jersey (ex 

officio) 

(V) 

C O N T E N T S 

Page 

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

of Pennsylvania, opening statement ................................................................... 1 

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

Hon. Gene Green, a Representative in Congress from the State of Texas, 

opening statement ................................................................................................ 4 

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

opening statement ................................................................................................ 6 

Prepared statement .......................................................................................... 7 

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

New Jersey, opening statement .......................................................................... 8 

WITNESSES

Sylvia Mathews Burwell, Secretary, Department of Health and Human Services ......................................................................................................................... 10 

Prepared statement .......................................................................................... 12 

Answers to submitted questions 1

SUBMITTED MATERIAL

Congressional Research Service memorandum, submitted by Mr. Griffith ........ 81 

Congressional Research Service report, 2 submitted by Mr. Griffith .................. 62 

Statement of the American Academy of Actuaries, submitted by Mr. Burgess . 91 

Statement of nearly 60 patient groups .................................................................. 94 

Article entitled, ‘‘How Medicaid for Children Partly Pays for Itself,’’ The 

New York Times, January 12, 2015, submitted by Mr. Pallone ...................... 97 

Article entitled, ‘‘Save the Children’s Insurance: Hillary Clinton and Bill 

Frist on Health Care for America’s Kids,’’ The New York Times, February 

12, 2015, submitted by Mr. Pallone .................................................................... 101 

1 Secretary Burwell did not respond to submitted questions by the time 

of printing. 2 Available at: http://docs.house.gov/meetings/if/if14/20150226/103028/ 

hmtg-114-if14-20150226-sd008.pdf 

(1) 

EXAMINING THE FISCAL YEAR 2016 HHS 

BUDGET 

THURSDAY, FEBRUARY 26, 2015 

HOUSE OF REPRESENTATIVES, SUBCOMMITTEE ON HEALTH, COMMITTEE ON ENERGY AND COMMERCE, Washington, DC. 

The subcommittee met, pursuant to call, at 10:03 a.m., in room 

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

Members present: Representatives Pitts, Guthrie, Barton, 

Whitfield, Shimkus, Murphy, Burgess, Lance, Griffith, Bilirakis, 

Ellmers, Bucshon, Collins, Upton (ex officio), Green, Engel, Capps, 

Schakowsky, Butterfield, Castor, Sarbanes, Matsui, Lujan, 

Schrader, Kennedy, Cardenas, and Pallone (ex officio). 

Staff present: Clay Alspach, Chief Counsel, Health; Gary Andres, 

Staff Director; Sean Bonyun, Communications Director; Leighton 

Brown, Press Assistant; Noelle Clemente, Press Secretary; Andy 

Duberstein, Deputy Press Secretary; Paul Edattel, Professional 

Staff Member, Health; Robert Horne, Professional Staff Member, 

Health; Charles Ingebretson, Chief Counsel, Oversight and Investigations; Peter Kielty, Deputy General Counsel; Carly McWilliams, 

Professional Staff Member, Health; Emily Newman, Counsel, Oversight; Katie Novaria, Professional Staff Member, Health; Tim 

Pataki, Professional Staff Member; Michelle Rosenberg, GAO 

Detailee, Health; Krista Rosenthall, Counsel to Chairman Emeritus; Adrianna Simonelli, Legislative Clerk; Alan Slobodin, Deputy 

Chief Counsel, Oversight; Heidi Stirrup, Health Policy Coordinator; 

Josh Trent, Professional Staff Member, Health; Traci Vitek, 

Detailee, HHS; Ziky Ababiya, Democratic Policy Analyst; Jeff Carroll, Democratic Staff Director; Eric Flamm, Democratic FDA 

Detailee; Hannah Green, Democratic Public Health Analyst; Tiffany Guarascio, Democratic Deputy Staff Director and Chief Health 

Advisor; Rachel Pryor, Democratic Health Policy Advisor; Tim Robinson, Democratic Chief Counsel; and Arielle Woronoff, Democratic 

Health Counsel. 

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

OF PENNSYLVANIA 

Mr. PITTS. The subcommittee will come to order. Chair will recognize himself for an opening statement. 

I would like to thank Secretary Burwell for appearing before the 

subcommittee to discuss the Administration’s fiscal year 2016 

2 

budget request for the Department of Health and Human Services. 

Earlier this year, Madam Secretary, you stated that, ‘‘The hallmark of effective leadership is instilling a culture of transparency, 

ownership, and accountability.’’ These are all laudable goals, and I 

appreciate your verbal commitment to these principles, however, 

your department’s actions have failed to adhere to the same standard. For example, we have only heard silence from the White 

House on how the Administration is preparing for an adverse ruling in King v. Burwell. We did receive a reply from you, and I 

thank you for that courtesy. 

But your letter contained no substantive answers to our questions. During your testimony to the Senate Finance Committee you 

were again asked about the Administration’s plans, and again you 

repeatedly declined to provide a direct answer. And this is not the 

transparency that we had hoped for. Understandably, we were very 

frustrated with the Administration witnesses artfully dodging the 

questions that we ask here. So I am asking you today, please let 

your guard down a little, and give us direct and complete answers 

to our questions. 

In 2009 the President correctly said, ‘‘The real problem with our 

long term deficit actually has to do with our entitlement obligations.’’ Since then we have had the Simpson-Bowles Commission, a 

super-committee, sequestration, and a government shutdown, and 

never once in all this time did the Administration propose a plan 

to get the Nation’s fiscal house in order by recommending reforms 

to entitlements. The 2014 Medicare Trustees’ Report, which you 

signed, tells us that Medicare will be bankrupt very soon. We recently had Senator Joe Lieberman and former OMB Director Alice 

Rivlin here, and they told us much the same. And we stand ready 

to do the hard work of saving and strengthening Medicare, but we 

need a willing partner. 

Once again, the President’s budget fails to propose serious entitlement reform. The proposals in the budget related to Medicaid 

amount to saving just 15 days’ worth of program spending over the 

next 10 years. The plan, apparently, is to let Medicare expenditures continue to grow without any of the structural reforms needed to strengthen and save this critical program, and this is not taking ownership. If we are going to save and strengthen our safety 

net programs for the most vulnerable, we have to do better than 

the President’s budget. Both parties have to work together. You, 

we, the President need to work together to save our entitlement 

programs, make them sustainable, so we ask that you please work 

with us. 

On another subject, you may also remember that in early November of last year we spoke on the phone about why HHS has so 

far failed to hold California accountable under Federal law. As you 

know, on August 22, 2014 the California Department of Managed 

Health care, DMHC, issued a directive mandating that all plans 

under DMHC authority immediately include coverage for all legal 

abortions. This is in direct violation of the Weldon Amendment, a 

civil rights statute that prohibits Federal taxpayer funding for Federal agencies and state or local governments that discriminate because a health care entity does not pay for or provide coverage of, 

or refer for abortions. 

3 

What California is doing is clearly illegal. It is also morally 

wrong, and violates the fundamental principles of freedom and conscience that our democracy is founded on, and it is your job to stop 

them, and so for that hasn’t happened. So I will have more to say 

about this when we get to the questions. 

In the meantime, Madam Secretary, we look forward to your testimony. We hope that you will stay to answer all of our questions. 

And, with only 5 minutes of questions per member, we respectfully 

ask that you keep your answers concise and to the point. 

[The prepared statement of Mr. Pitts follows:] 

PREPARED STATEMENT OF HON. JOSEPH R. PITTS

The Subcommittee will come to order. 

The Chair will recognize himself for an opening statement. 

I would like to thank Secretary Burwell for appearing before the Subcommittee 

to discuss the Administration’s FY2016 budget request for the Department of 

Health and Human Services. 

Earlier this year, Madam Secretary, you stated that ‘‘the hallmark of effective 

leadership is instilling a culture of transparency, ownership, and accountability.’’ 

These are all laudable goals and I appreciate your verbal commitment to these 

principles. However, your Department’s actions have failed to adhere to the same 

standard. 

For example, we have only heard silence from the White House on how the Administration is preparing for an adverse ruling in King v. Burwell. 

We did receive a reply from you, and I thank you for that courtesy. But your letter contained no substantive answers to our questions. 

During your testimony to the Senate Finance Committee, you were again asked 

about the Administration’s plans. Again, you repeatedly declined to provide a direct 

answer. 

This is not the transparency you promised. Understandably, we are very frustrated with Administration witnesses artfully dodging the questions we ask here. So 

I’m asking you: please let your guard down a little today, and give us direct and 

complete answers to our questions. 

In 2009, the President correctly said, ‘‘The real problem with our long-term deficit 

actually has to do with our entitlements obligations.’’ 

Since then we have had the Simpson-Bowles Commission, a Supercommittee, Sequestration, and a government shut down. Never once in all this time did the Administration propose a plan to get the nation’s fiscal house in order by recommending reforms to entitlements. 

The 2014 Medicare Trustees Report, which you signed, tells us that Medicare will 

be bankrupt very soon. We recently had Senator Joe Lieberman and former OMB 

Director Alice Rivlin here. They told us much the same. We stand ready to do the 

hard work of saving Medicare, but we need a willing partner. 

Once again, the President’s budget fails to propose serious entitlement reform. 

The proposals in the budget related to Medicaid amount to saving just 15 days’ 

worth of program spending over the next ten years. 

The plan, apparently, is to let Medicare expenditures continue to grow without 

any of the structural reforms needed to strengthen and save this critical program. 

This is not taking ownership. 

If we are going to save and strengthen our safety net programs for the most vulnerable, we have to do better than the President’s budget. Both parties have to work 

together. You, we, and the President need to work together to save our entitlement 

programs and make them sustainable. Please work with us. 

On another subject, you may also remember that, in early November of last year, 

we spoke on the phone about why HHS has so far failed to hold California accountable under federal law. 

As you know, on August 22, 2014, the California Department for Managed Health 

Care (DMHC) issued a directive mandating that all plans under DMHC authority 

immediately include coverage for all legal abortions. 

This is in direct violation of the Weldon Amendment, a civil rights statute that 

prohibits federal taxpayer funding for Federal agencies and state or local governments that discriminate because a health care entity does not provide, pay for, provide coverage of, or refer for abortions. 

4 

What California is doing is clearly illegal. It is also morally wrong, and violates 

the fundamental principles of freedom and conscience that our democracy is founded 

on. It is your job to stop them, and so far that hasn’t happened. I’ll have more to 

say about this when we get to questions. 

In the meantime, Madam Secretary, we look forward to your testimony. We hope 

that you will stay to answer all of our questions, and, with only five minutes of 

questions per Member, we respectfully ask that you keep your answers concise and 

to the point. 

Thank you, and I yield the remainder of my time to Rep. 

—————————————————. 

Mr. PITTS. And, Dr. Burgess, do you want the remaining time? 

Mr. BURGESS. Thank you, Mr. Chairman, that is very kind of 

you. And, Secretary, thank you for coming to our humble little subcommittee. I am frustrated over the Administration’s lack of transparency, and the ability for Congress to get information that, realistically, we have been asking for for the last 4 or 5 years, but specifically around ACA created entities, the Center for Medicare and 

Medicaid Innovation, the Prevention and Public Health Fund, the 

Consumer—the Office of Consumer Information and Insurance 

Oversight, and the Patient Center for Outcomes and Research Initiative. Year after year they have failed to achieve their mission of 

reducing health care costs and improving quality. We can’t hold 

them accountable if we don’t know how you are spending the dollars. So you and I have talked about this, and I do look forward 

to your responses and being able to finally get that information regarding those agencies under your—— 

Mr. PITTS. Chair thanks the gentleman. Now recognize the Ranking Member, Mr. Green, 5 minutes for opening statement. 

OPENING STATEMENT OF HON. GENE GREEN, A 

REPRESENTATIVE IN CONGRESS FROM THE STATE OF TEXAS 

Mr. GREEN. Good morning, and thank you, Secretary Burwell, for 

being here today to discuss the President’s FY ’16 budget proposal 

for the Department of Health and Human Services. A budget is 

more than a line of items on a page. It is a reflection of the priorities of our country. Our commitment must be to protect the 

progress that we made, and to make strategic investments so that 

progress will continue in the future. 

This year marks the 50th anniversary of the creation of Medicare 

and Medicaid. Since the Children’s Health Insurance Program was 

created to ensure America’s children have insurance, most recently 

Congress passed the Affordable Care Act, dramatically expanding 

access to health coverage and high quality care. The Affordable 

Care Act took historic—steps toward laying the foundation for a 

better and more efficient health care system, and expanding access 

to cover for millions of Americans for whom it was previously out 

of reach. It also took important steps to restore the fiscal solvency 

of our health care system. According to the most recent estimates 

by the Congressional Budget Office, the Affordable Care Act will 

reduce the deficit by more than $100 billion for the first decade, 

and by more than a trillion in the second decade. 

As we have seen through the second enrollment period, the Affordable Care Act has already succeeded in ensuring every American can have access to high quality affordable coverage. Thanks to 

the ACA, nearly 30 million Americans got covered. These are peoVerDate Nov 24 2008 12:31 Jul 13, 2016 Jkt 037690 PO 00000 Frm 00010 Fmt 6633 Sfmt 6633 F:\MY DOCS\HEARINGS 114\114-13 CHRIS
5 

ple who would otherwise be uninsured. We have made great 

progress, but the work is not done. I thank the agency for implementing the landmark health reform law, and continuing to work 

with us so that we can build on these successes. 

In addition to prioritizing essential services and programs, I was 

pleased to see that the budget makes strategic investments to improve our health care system, and clear the way for the progress 

into the future. This includes funding to support training of the 

next generation of health care providers, national preparedness 

against threats to public health, biomedical research, drug safety, 

and mental health services. The budget invests in community 

health centers to support the care they provide for 22 million patients. In their role of providing an accessible, reliable source of 

primary care in underserved communities, health centers will continue to be a critical element of our health system. 

The President’s proposal takes a critical important step by including four years of funding for the Children’s Health care Insurance Program. Currently more than 10 million children get health 

insurance through CHIP. Additional funding for CHIP must be authorized so that there is no disruption in coverage, and the states 

are able to continue operating their programs. The budget proposes 

an increase in NIH funding. Since its creation, NIH has fostered 

remarkable advancements in human health, but for the past decade NIH has suffered inadequate funding. Without significant 

funding increases, the U.S. will lose its status as a global leader 

in science and innovation. Additional resources will help defeat our 

Nation’s most harmful diseases, and ensure that the United States 

continues to lead biomedical research and scientific breakthroughs. 

The budget proposal strengthens national preparedness for 

threats to public health, including naturally occurring threats, and 

deliberate attacks. It also includes funding to reinforce our Nation’s 

ability to move quickly to detect infectious disease outbreaks 

through new advanced molecular detection initiative, maintaining 

strong expertise at the Centers of Disease Control and Prevention. 

These are just a few highlights of what is included in the proposed 

HHS budget. I look forward to hearing more about the Administration’s proposal during today’s hearing. 

Thank you, Madam Secretary, for joining the committee to discuss the HHS budget. And if someone would like about a minute 

and 20 seconds? My colleague from California, Ms. Matsui. 

Ms. MATSUI. Thank you very much for yielding the time, and 

welcome, Secretary Burwell. I appreciate the goals the President 

and you have laid forth in the fiscal budget 2016 Department of 

HHS Services Budget. Building on the improvements made by the 

Affordable Care Act, we are seeking to move our Nation’s health 

system by rewarding volume, and forgetting about the waste business. So—do this is working to achieve the triple aim in health 

care, better care, better outcomes, and reduced costs. We do this by 

making health insurance more affordable, by emphasizing prevention and public health, by encouraging scientific and clinical research, by taking advantage of the benefits of technology, and 

building up our Nation’s mental health system. 

Many of the proposals in the budget find savings in the Medicare 

and Medicaid programs by streamlining processes and realigning 

6 

systems to ensure that patients get the right service at the right 

time. The budget would make the SGR fix permanent, which we 

need to do to provide stability for doctors, and for seniors, and people with disabilities in the Medicare program. The budget would 

also extend the Children’s Health Insurance Program, or CHIP, 

that provides much needed pediatric coverage to our Nation’s children. 

To conclude, I want to emphasize the Affordable Care Act is 

working. Over 11 million Americans signed up this year, including 

500,000 in California alone. The Administration just announced 

that since the law was enacted in 2010, 9.4 million people with 

Medicare have saved over $15 billion in prescription drugs. This is 

what we set out to do, and I appreciate working with you as we 

move forward. Thank you. Yield back. 

Mr. PITTS. Gentlelady yields back. Chair now recognizes Chairman of the full Committee, Mr. Upton, for 5 minutes for an opening statement. 

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

Mr. UPTON. Well, thank you, Mr. Chairman. Secretary Burwell, 

welcome. Today marks your first official appearance before the 

Health Subcommittee, but I know that this is not your first time 

in this room, as you participated in one of our 21st Century Cures 

roundtables last year, and we very much appreciate that participation. 

Your testimony does come at a very pivotal point in health policy, from our exciting cures effort, to next week’s Supreme Court 

oral arguments. We look forward to hearing the Administration’s 

perspective on the many important issues facing the American people. You have said during your tenure at HHS that transparency, 

ownership, and accountability are important values for the Department of demonstrate, which we certainly welcome. 

In that spirit, we look forward to gaining straightforward answers here today about implementation of the President’s health 

care law. There have been quite a few red flags raised in recent 

weeks on the continued struggles to implement key pieces of that 

health law. Just in the last week, 800,000 households learned that 

key tax forms sent out by the Administration contained major errors. Those Americans were asked to delay tax filing, therefore also 

delaying their refunds. A recent analysis from H&R Block estimates that the majority of Obamacare customers are being forced 

to pay back some of those subsidies. Millions of Americans are also 

learning about the law’s IRS fines for failing to comply with the individual mandate. 

The backlash has been so intense that the Administration has resorted to yet another special enrollment period to quell some of the 

anger of those who are just coming to learn about the individual 

mandate penalty. In this last week, the healthcare.gov CEO, Kevin 

Counihan, suggested that the backend functions of the exchange 

would undergo a 2-year development plan. That means that this 

key part of the law will not be fully complete until President 

Obama leaves the White House. 

7 

Collectively, these revelations suggest that the health care law is 

still not working. Our constituents deserve better, we know that. 

That is why I have worked on introducing the Patient Care Act, a 

health care reform blueprint, with my colleagues in the Senate, 

Chairman Hatch and Mr. Burr. I look forward to working with my 

colleagues about these ideas to improve health care in America by 

empowering states and families, not Washington. 

Yes, we have concerns with the President’s signature law, but 

there are other important health care areas that we believe are fertile for collaboration. For the past year, almost year and a half, this 

committee has undertaken the bipartisan 21st Century Cures Initiative to accelerate the pace of the discovery, development, and delivery of new treatments and cures for American patients. 

I would like to thank you for your personal engagement on the 

21st Century Cures Initiative. As you know, this is a top priority 

for our committee this year. Patients and families in my district in 

Michigan, as well as across the country are looking for hope, and 

that is what we seek to instill. And this effort is also important to 

many job creators, whether it be Stryker, Perrigo, or Pfizer in 

southwest Michigan. I also want to thank the staff throughout the 

administration, particularly at the FDA and the NIH for their 

work, their time, and effort to help us improve the ideas released 

by our committee at the end of last month. We have established a 

very good foundation, I think, for bipartisan success. And I will 

yield to other Republican members on this side. Seeing none—— 

Mr. PITTS. Anyone seeking time? 

Mr. UPTON [continuing]. Yield back. 

[The prepared statement of Mr. Upton follows:] 

PREPARED STATEMENT OF HON. FRED UPTON

Secretary Burwell, welcome. Today marks your first official appearance before the 

Health Subcommittee—but I know it isn’t your first time this room as you participated in one of our 21st Century Cures roundtables last year. Your testimony today 

comes at a pivotal point in health policy, from our exciting cures effort to next 

week’s Supreme Court oral arguments. We look forward to hearing the administration’s perspective on the many important issues facing the American people. You 

have said that during your tenure at HHS, transparency, ownership, and accountability are important values for the department to demonstrate, which we welcome. 

In that spirit, we look forward to gaining straightforward answers here today 

about implementation of the president’s health care law. There have been quite a 

few red flags raised in recent weeks on the continued struggles to implement key 

pieces of the health law. 

Just in the past week, 800,000 households learned that key tax forms sent out 

by the administration contained major errors. Those Americans were asked to delay 

tax filing, therefore also delaying refunds. A recent analysis from H&R Block estimates that the majority of Obamacare customers are being forced to pay back some 

of their subsidies. 

Millions of Americans are also now learning about the law’s IRS fines for failing 

to comply with the individual mandate. The backlash has been so intense that the 

administration has resorted to yet another ‘‘special enrollment period’’ to quell some 

of the anger of those who are just coming to learn about the individual mandate 

penalty. 

And this week, the HealthCare,gov CEO Kevin Counihan suggested that the backend functions of the exchanges would undergo a two-year development plan. That 

means this key part of the law will not be fully complete until President Obama 

leaves the White House. 

Collectively, these revelations suggest that the health care law is still not working. Our constituents deserve better. That is why I have worked on introducing the 

Patient CARE Act, a health care reform blueprint with my colleagues in the Senate, 

8 

Chairman Hatch, and Mr. Burr. I look forward to working with my colleagues about 

these ideas to improve health care in America by empowering states and families, 

not Washington. 

Yes we have concerns with the president’s signature law. But there are other important health areas that we believe are fertile for collaboration. For the past year, 

this committee has undertaken the bipartisan 21st Century Cures initiative to accelerate the pace of the discovery, development, and delivery of new treatments and 

cures for American patients. 

I would like to thank you for your personal engagement on the 21st Century 

Cures initiative. As you know, this is a top priority for our committee this year. Patients and families in my district in Michigan and across the country are looking 

for hope, and that’s what we seek to instill. And this effort is also important to 

many job creators as well, firms like Stryker, Perrigo, and Pfizer in southwest 

Michigan. I would also like to thank the staff throughout the administration, particularly at the FDA and NIH, their time, work, and effort to help us improve the 

ideas released by our committee at the end of January. We have established a great 

foundation for bipartisan success. 

Mr. PITTS. The Chair thanks the gentleman, and now recognizes 

the Ranking Member of the full Committee, Mr. Pallone, 5 minutes 

for an opening statement. 

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

Mr. PALLONE. Thank you, Chairman Pitts, and welcome, Secretary Burwell. Thank you for being with us today. Today we are 

going to hear about the President’s fiscal year 2016 Health and 

Human Services budget proposal, and there are many important 

provisions in the President’s budget that we in Congress must work 

to support. I was pleased to see that the budget proposed a funding 

increase of $1 billion for the NIH, investing in early stage basic research, is one of the most promising ways that we can accelerate 

the discovery of new treatments and cures. And support for NIH 

is critical to building our economy as well. Every dollar of NIH 

funding generates over $2 in local economic growth, yet we have 

let NIH purchasing power decline by over 20 percent since 2003, 

and that is why finding a way to significantly increase funding for 

NIH will be my top priority, as the 21st Century Cures Initiative 

continues. 

I was also pleased to see that the budget fully funds a 4-year extension of the Children Health Insurance Program, or CHIP. We 

must act on this proposal immediately. With more than 4⁄5 of state 

legislatures adjourning the by the end of June, lack of action and 

clarify from Congress will make budgeting and planning virtually 

impossible. By every measure, CHIP has become enormously successful, and always has had strong bipartisan support, so extending 

CHIP funding should be the top priority of this committee to ensure consistent coverage for the millions of children who depend on 

this program. And I think we can all agree that no child should be 

left worse off because of the actions, or lack thereof, of Congress. 

The budget also adopts the framework of the bipartisan, bicameral SGR repeal and replace legislation that Congress agreed 

to last year. I believe that because the Sustainable Growth Rate is 

the result of a budget gimmick, and we already spent $169 billion 

paying to fix the problem, that offsets, especially those within our 

health programs, are not necessary. And if we must include offsets, 

the war savings, which are known as the Overseas Contingency 

9 

Operation Funds, could be used. I know some on the other side of 

the aisle don’t share this view. What I do hope is that we can agree 

that, first, SGR should not be paid off of the backs of the beneficiaries. Beneficiaries will already pay for their share of the cost 

of SGR repeal through higher premiums, and half of all beneficiaries live on less than $23,500. 

And that is why some of the proposals in the President’s budget 

concern me. The President’s budget proposes to further increase 

Part B and Part D premiums, increase the Part B deductible for 

new enrollees, and impose a new surcharge on the Part B premium 

for beneficiaries with certain Medigap policies, and also institutes 

a $100 copayment per home health episode. And this increases out 

of pocket costs on beneficiaries, and I think that we have seen 

enough of that. Beneficiaries may forego necessary services, and, in 

result, use more high cost acute care services, and such policies 

will disproportionately affect lower and middle income beneficiaries 

who are not poor enough for Medicaid, nor have access to employer 

sponsored retiree health care. So I urge the President and my colleagues to be extremely cautious when proposing cuts to Medicare, 

and consider impacts on our seniors. 

The last thing I wanted to mention is—well, first to commend 

you, Secretary, for your agency’s hard work implementing the Affordable Care Act. Because of your efforts, 19 million uninsured 

Americans will be covered in this year, 2015. And I recognize the 

challenge your agency faces in implementing this law with limited 

resources, however, despite what I call Republican obstructionism, 

the Affordable Care Act is working. 

In sum, I think this is a sound budget, and I look forward to 

hearing from you today. And I would yield the remainder of my 

time to the gentlewoman from Florida, Ms. Castor. 

Ms. CASTOR. Well, I thank the Ranking Member for yielding 

time, and I welcome Secretary Burwell. We are very excited to hear 

about the budget, the investments in medical research and Children’s Health Insurance, improvements in Medicare, and the Centers for Disease Control. But I couldn’t help but ask Mr. Pallone 

for a minute to highlight the Florida enrollment numbers under 

the ACA. It is remarkable. And I know you have seen them, and 

we have talked about it. As of February 15, over 1.6 million Floridians have signed up for health insurance in the federally facilitated 

marketplace. We are surprised. This exceeded all of our expectations, to beat California and Texas, especially in a state that had 

many fits and starts over whether to assist our neighbors in signing up. 

But I wanted to highlight a couple of stories. A 27-year-old third 

year law student at the University of South Florida got assistance 

from a navigator. His income is about $16,000 a year in scholarships. He was able to find insurance for approximately $10 per 

month, zero deductible. It is his second year enrolling in the marketplace. He is very happy with his coverage. There are stories like 

that again, and again, and again, so I look forward to talking about 

it. Thank you. 

Mr. PITTS. Gentlelady yields back. That concludes the oral opening statements. As usual, all the written opening statements of the 

members will be made a part of the record. And so we will go now 

10 

to Secretary Burwell. First of all, thank you for appearing before 

us today, Madam Secretary. Your written testimony will be made 

a part of the record. You will be given 5 minutes to summarize 

your testimony, and we certainly appreciate you being here this 

morning. And you are recognized for 5 minutes for your summary. 

STATEMENT OF THE HONORABLE SYLVIA MATHEWS 

BURWELL, SECRETARY, DEPARTMENT OF HEALTH AND 

HUMAN SERVICES 

Secretary BURWELL. Thank you Chairman Pitts, Chairman 

Upton, Ranking Member Pallone, and Ranking Member Green, and 

members of the committee. I appreciate the invitation to be here 

today. I want to thank you for the 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 for common ground, from 

preventing and treating substance abuse, to advancing the promise 

of precision medicine, to building an innovation economy, and 

strengthening the American middle class. The budget before you 

makes critical investments in health care, science, innovation, and 

human services. It maintains our responsible stewardship of the 

taxpayers’ dollars. It strengthens our work together with the Congress to prepare our Nation for key challenges, both at home and 

abroad. 

For HHS, it proposes $83.8 billion in discretionary budget au- thority, and this is a $4.8 billion increase, which will allow our department to deliver impact today, and lay a strong foundation for 

tomorrow. It is a fiscally responsible budget, which, in tandem with 

accompanying legislative proposals, would save taxpayers a net estimated $250 billion over the next decade. In addition, it is projected to continue slowing the growth of Medicare. It could secure 

423 billion in savings as we build a smarter, healthier, better system. 

In terms of providing all Americans with access to quality, affordable health care, it builds upon our historic progress in reducing the number of uninsured, and improving coverage for families 

who already have insurance. We saw a recent example of this 

progress with the about 11.4 million Americans who either signed 

up or re-enrolled in this past open enrollment. It extends CHIP for 

4 years, it covers newly eligible adults in the 28 states, plus D.C., 

which have expanded Medicaid, and it improves access to health 

for Native Americans. To support communities throughout the 

country, including underserved communities, it invests $4.2 billion 

in health centers, and $14.12 billion to bolster our Nation’s health 

workforce. It is more than 50,000 National Health Service Corps 

clinicians, serving nearly 16 million patients in high need areas 

across the country. With health center mandatory funding ending 

in 2016, we estimate that more than seven million Americans may 

lose access to essential cost-effective primary care, and this could 

approximately result in 40,000 jobs lost. 

To advance our common interests in building a better, smarter, 

healthier delivery system, the budget supports improvements to 

the way care is delivered, providers are paid, and information is 

distributed. On an issue for which there is bipartisan agreement, 

11 

it replaces Medicare’s flawed sustainable growth rate formula, and 

supports a long term policy solution to fix the SGR. The Administration supports the type of bipartisan, bicameral efforts that the 

Congress took last year. 

To advance our shared vision for leading the world in science and 

innovation, it increases funding for the NIH by a billion dollars to 

advance biomedical and behavioral research. In addition, it invests 

250 million for the Precision Medicine Initiative, an effort to focus 

on developing treatments, diagnostics, and prevention strategies 

tailored to individual genetic characteristics. To further our common interests in providing Americans with the building blocks for 

success at every stage of life, this budget outlines an ambitious 

plan to make affordable quality child care available to every working class—middle class family. 

To keep Americans health, the budget strengthens our public 

health infrastructure, with $975 million for domestic and international preparedness, including critical funds to the Global Health 

Security Agenda. The budget will support CDC’s critical infrastructure and cost-cutting research to facilitate rapid response to public 

health emergencies, and other public health threats, like the recent 

measles outbreak. It also invests in behavioral health sciences, and 

substance use prevention. Finally, as we look to leave our department stronger, the budget invests in our shared priorities of cracking down on waste, fraud, and abuse initiatives, and are projected 

to yield $22 billion in gross savings for Medicare. We are also addressing our Medicare appeals backlog with a variety of approaches, and we are investing in cybersecurity. 

As a close, I want to make one final point, and that is I am personally committed to responding quickly and thoughtfully to the 

concerns of Congress and members. Since I was confirmed, I have 

made it the top priority of our department to respond promptly and 

thoroughly, and work with you as we can. I also just want to take 

one moment to thank the HHS employees for all their work on 

Ebola, unaccompanied children, and all the other issues. With that, 

I look forward to your questions. Thank you. 

[The prepared statement of Secretary Burwell follows:] 

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Mr. PITTS. Thank you, Madam Secretary. I will begin the questioning, and recognize myself for 5 minutes for that purpose. 

Let me start with King v. Burwell. In a few short days, the Supreme Court will be hearing oral arguments in the King v. Burwell 

case that could have a major impact on Obamacare. In January we 

sent you a letter, asking for any actions, analysis, and/or contingency plans that HHS has undertaken to prepare if the IRS rule 

is overturned. And while we received a letter from you earlier this 

week, your response failed to actually answer our question. The letter simply stated that you believed no administrative action by 

HHS could reverse the effects of a decision in favor of the Plaintiffs. 

Madam Secretary, your statement of opinion in the letter does 

not answer a simple question, so let me ask you the question this 

way. Have you or senior Department officials instructed counselors 

within HHS to prepare any potential actions or approaches if the 

Supreme Court rules against the IRS? 

Secretary BURWELL. Mr. Chairman, with regard to what is in the 

letter, one of the things that I think is important to reflect that is 

in the letter is the analysis of what would happen. That is a part 

of the letter. And in terms of what would happen—and I first 

should state that we believe that the Court will decide in favor of 

the position we hold, which is we believe that this law says that— 

people have traveled across the country—people in Texas should 

have the same subsidies as people in New York. It is an important 

starting point. 

But with regard to what would happen, because I think that is 

an important part of answering the question, first, what would 

happen is, when those subsidies go away, 11.4 million people, that 

was the number I gave you—as of January 30, when we did our 

most recent analysis, 87 percent of the individuals in the marketplace are eligible for subsidies. Those subsidies are, on average, estimated to be $268 per individual, per month. Those subsidies, 

number one, would go away. 

Mr. PITTS. Yes. 

Secretary BURWELL. That would lead to a number—— 

Mr. PITTS. Madam Secretary, I understand that. I am asking if 

you know of any plan to respond to approaches if the Supreme 

Court rules against the IRS? Has the White House, has OMB, or 

other Administration officials directed or asked you about any approaches in response to King v. Burwell, or to work with the Treasury Department on potential responses? That is my question. 

Secretary BURWELL. So, in order to respond to the question, Mr. 

Chairman, in order to think about the question of a plan, one needs 

to, I think, analyze the problem, which is what I was articulating, 

in terms of the three major things that would occur if the Court 

decides with the Plaintiffs. 

Mr. PITTS. Let me ask it a different way. I would like to provide 

you some more information as to why we expect an answer from 

you today. The Committee received recently specific information 

from a source within your department about the existence of an approximately 100-page document related to potential actions HHS 

may take if the Supreme Court rules against the Administration in 

32 

King v. Burwell. Are you, or senior staff at HHS, aware of this document? 

Secretary BURWELL. Mr. Chairman, this is a document I am not 

aware of. 

Mr. PITTS. OK. 

Secretary BURWELL. With regard to the question that you have 

asked, as I said in the letter, we believe—and I think it is very important to understand the damage, because it is related to the answer. The damage comes in the number of uninsured that would 

occur. Number two, it occurs in what happens in the individual 

marketplace, where a group of less health individuals come in, and 

that drives premiums up in that marketplace. And, number three, 

the indigent care that occurs from the uninsured, and what that 

means in both those states, in terms of their economies, as well as 

what it means for employer base. Those are the ramifications. With 

regard to those things, which we believe are the damage, as I state 

in the letter, we believe we do not have any administrative actions, 

and, therefore, there is not—— 

Mr. PITTS. All right, let me go on to another issue. I, as you 

know, as we discussed over the phone, am deeply concerned about 

the lack of HHS action regarding California, and the DMHC authority to immediately include coverage for abortion. And this mandate, California mandate is a clear violation of the Weldon Amendment, which provides civil rights protections, and prohibits funding 

to government entities discriminating against health care entities 

for following their conscience. Do you agree that the Weldon 

Amendment prohibits funding for states that mandate abortion 

coverage in insurance plans? 

Secretary BURWELL. We take the Weldon Amendment very seriously. And since you spoke with me, Mr. Chairman, and we received those letters, we have opened an investigation in the Office 

of Civil Rights at HHS to investigate the concerns that you and 

others have articulated. We take this seriously, and are trying to 

move through that investigation as expeditiously as possible. 

Mr. PITTS. So since it is clear that California is in violation of 

Federal law, can you project a date by which you expect the violation to be stopped? 

Secretary BURWELL. With regard to the issue of the investigation, Mr. Chairman, that is not something—I need to let the investigation go, and I have asked the team to make sure they do it as 

expeditiously as possible, but in order—that I stay away from the 

investigation, in terms of my interference in any way. I want to let 

them go forward, but I have asked for due speed. 

Mr. PITTS. OK. We will follow up. Thank you. Chair recognizes 

the Ranking Member Green, 5 minutes for questions. 

Mr. GREEN. Thank you, Mr. Chairman. 

Madam Secretary, it has been almost 5 years since the Affordable Care Act was passed, and have yet to see any legislation introduced by my Republican colleagues to replace the Affordable Care 

Act, even though we have had at least 56 votes on the House floor 

to repeal it. Given all this talk of repealing the Affordable Care 

Act, are you aware of any request for technical assistance from Republicans on legislation that would replace the Affordable Care Act 

33 

with a credible proposal to provide comprehensive health coverage 

to millions of Americans? 

Secretary BURWELL. I am not aware of those requests. 

Mr. GREEN. Madam Secretary, over the last couple days we have 

heard a lot about contingency plans. If the millions of Americans 

who received financial help through the Affordable Care Act would 

lose them, are you aware of any Republican legislative proposals 

that would provide millions of Americans with the financial assistance to help them with affordable health care coverage? 

Secretary BURWELL. I am not aware. 

Mr. GREEN. Secretary, I want to get your input on an issue that 

I know you are concerned—I appreciate you addressing it in your 

opening remarks, that myself, and a lot of members of our committee—there is a funding cliff that is facing our community health 

centers. Health centers serve nearly 22 million patients, and are 

projected to serve 28.6 million patients in over 9,000 locations 

across the country in the fiscal year of 2016. Because of the current 

patient demographics and statutory mandate to locate in underserved areas, or to serve underserved populations, health centers 

are well positioned to provide health care service to millions of 

newly insured Americans. They are particularly important in our 

district, which is a federally designated underserved community in 

Houston, Texas. 

Secretary Burwell, I was pleased to see the President’s budget included a multi-year extension of mandatory funding for health centers. As you know, the health centers patients face a major loss of 

access in a few months if we don’t act to prevent the funding cliff 

caused by the expiration of the mandatory funding at the end of 

the fiscal year. Can you speak about the importance of community 

health centers within our health system as we look at the issues 

of access, quality, and cost? 

Secretary BURWELL. We believe that they are a fundamental underpinning, and not just in terms of health care in communities, 

but they are also an important part of the economics of communities, when you think about the fact that we could lose up to 

40,000 estimated jobs in terms of who we don’t extend. But as you 

think about the numbers, thinking that 1 in 15 Americans actually 

are served by these health centers, how integral they are to providing primary care throughout the country. 

And so we think it is extremely important to continue that so 

that we can—as we have reduced the number of uninsured, we also 

want to make sure that those people are having care, and those 

that had care before still have access to that care, especially in our 

underserved communities across the country, not all, but many of 

which are very rural. 

Mr. GREEN. Can you comment on the impact that the funding 

cuts would have on patients’ access to care? Can you estimate how 

many fewer people would be able to receive services at our local 

health centers? 

Secretary BURWELL. Our estimates are that if we aren’t able to 

extend, that it could be up to seven million patients who would no 

longer be able to have access to that care. We estimate that perhaps over 2,000 of the centers would shut down without that, and 

that—then there are the patients who would not be served because 

34 

people would have to scale back in a number of the centers with 

reduced funding. 

Mr. GREEN. In those 2,000 centers, do you know how many jobs 

we lost? 

Secretary BURWELL. Approximately—the estimates are up to 

40,000. 

Mr. GREEN. OK. Thank you. The health centers are a crucial part 

of our Nation’s primary care infrastructure for 50 years, and have 

long had truly bipartisan support. In the last year, along with my 

colleagues on both sides, including Representative Lance, support— 

reiterating our support for health centers, and calling for a bipartisan solution, we had 250 co-signers, including 31 members of our 

committee. A similar letter in the Senate gathered 60—gained 66 

votes, and more than 100 national organizations have called for a 

fix. Consensus is something must be done, and we have to act as 

soon as possible. 

This issue is a top priority of mine, and I know a lot of other 

members, literally, Republican and Democrat across the country, 

who look forward to working with you and our colleagues on the 

committee on a bipartisan basis to find a solution to avert that 

funding cliff. 

Mr. Chairman, I have 43 seconds left, and I would like to yield 

for somebody for that 43 seconds on our side. Anybody want about 

30 seconds now? OK. Well, Mr. Chairman, I yield back. 

Mr. PITTS. Thank you. Chair now recognizes the Chairman of the 

full Committee, Mr. Upton, 5 minutes for questions. 

Mr. UPTON. Thank you again, Mr. Chairman. Secretary Burwell, 

there are a number of health care law implementation issues that 

continue to trouble us. In the interest of time, I would ask that you 

submit answers to the following questions in writing within 2 

weeks. 

The CEO of healthcare.gov recently stated that there is a 2 year 

development plan for the backend of the healthcare.gov. If you 

could provide us an estimate of when the backend will finally be 

fully automated, would be great. Second one is HHS recently announced that 800,000 Americans enrolled in coverage through 

healthcare.gov received inaccurate tax forms under the ACA. We 

would like a detailed assessment on when the Department expects 

these taxpayers will have accurate information in hand so that 

they can file their taxes. And third, many Americans were automatically re-enrolled in exchange plans, raising concerns that individuals and families may be getting unexpected premium bills, or 

inaccurate exchange subsidies in 2015. We would ask that you submit specific data on the number of Americans who have been automatically re-enrolled in those exchange plans. So that would be 

helpful. 

Now I will return to 21st Century Cures, and again, appreciate 

your personal assistance with this. And I, for the record, want to 

certainly thank Dr. Collins, Commissioner Hamburg, Dr. 

Woodcock, and Dr. Shuren, countless others at your department for 

the help on 21st Century Cures. Because of that participation, and 

participation of folks from across the country, we have been able 

to learn more about the status of innovation in this country, and 

35 

we hear about ways to accelerate the discovery, development, delivery of cures and treatments for patients. 

As we heard at our first roundtable, there are over 10,000 diseases, and we have only cures and treatments for about 500, so we 

have a great deal of work ahead to do. We released a discussion 

document last month, and have been working with Congresswoman 

DeGette, Ranking Member Pallone, Mr. Green, other members of 

our Committee, and on both sides of the aisle to improve that document. One area that includes a placeholder is precision medicine, 

something the President talked about in the State of the Union Address, and subsequently a White House event a couple weeks ago. 

We did put that placeholder into the draft, and we look forward to 

continuing to work with you, and the White House, the Administration, on that important issue. Could you give us a background on 

the Administration’s precision medicine policy, and what we should 

look forward to? 

Secretary BURWELL. Thank you, and thank you for the partnership, as we work through these issues together, and it is exciting 

to have the energy around these issues, including the precision 

medicine, which is, I think, a subset of the broader issues you are 

looking at. Our precision medicine initiative is $215 million, with 

regard to—as we think about it from a budget perspective. 

But I think thinking about it from the pieces and what it is 

doing, one part of the initiative is creating a very large database 

of a million people through NIH, but we will access that through 

other channels, so that we are drawing from existing databases to 

get the information we need, because, as we are talking about what 

this is, precision medicine, or personalized medicine, is getting the 

information so that we can do treatments that are to the individual. 

I was at NIH recently, had the opportunity to both see the tumors and meet the cancer patient of a kidney cancer patient, where 

he had a group of tumors removed. They came back, but then, 

using precision medicine, which meant looking specifically at the 

genetic makeup of his tumors—be treated in a different way. I met 

him. That happened months ago, and now he—the patient was 

there, discussing it with me, and is a very different place. So, one, 

that large database. Two, specifically focusing in the area of cancer, 

because we already are seeing some progress there, and we believe 

that place is right for it. 

The other thing we need to do is FDA. Make sure that, as we 

think about precision medicine, we regulate, and think about how 

to improve these things in ways of a different type of medicine. 

And then finally, we need the health records, the Office of National 

Coordinator for Health—Electronic Health Records to be a part of 

making sure this will do with payments, and how clinicians will 

use. Those are the elements. 

Mr. UPTON. Well, I just want to say, that is very helpful, and we 

are excited as well. And though I have been out to the NIH a number of times in the past number of years, I want to remind members here that we have got a committee trip—I have invited, I 

think, all the members on this subcommittee to go out to the NIH 

next Monday morning. Dr. Collins has been very interested in having us out to kick the tires, like you saw yourself. 

36 

And I know that, because we have votes tomorrow, Friday, and 

again on Monday, and perhaps over the weekend, there may be 

more of us here over the weekend than originally thought. So I 

want to remind members that they are invited to join with us and 

not miss votes come Monday on a trip there, and I yield back. 

Thank you very much. 

Mr. PITTS. Chair thanks the gentlemen. Now recognize the Ranking Member of the full Committee, Mr. Pallone, 5 minutes for questions. 

Mr. PALLONE. Hello, Secretary Burwell. I am sure you can sense 

that I am very proud of the Affordable Care Act, and concerned 

about Republican efforts to repeal it, or now take it to court, in the 

case of King vs. Burwell. 

Are you aware of any Republican bill that would reduce the number of uninsured in this country by 11 million people—I said 11, 

it is actually 19 million people, the way that the Affordable Care 

Act does? I mean, obviously I am saying this because I don’t see 

them coming up with any alternative. 

Secretary BURWELL. You know, we haven’t, and I think it is important to reflect, historically, when one looks at the history, and 

actually I have gone back to Teddy Roosevelt, and the quotations 

from Teddy Roosevelt forward, through both Republican and Democratic administrations, we see—whether it was President Bush, 

President Nixon, President—Republican and Democrat, President 

Clinton, the conversation about how we make this next step forward, with regard to reducing uninsured, is something that we 

struggled with as a Nation. 

And this is the first time, and someone reflected on the anniversary of Medicare, and that 50 year anniversary, this is the first 

time that we have seen that. And so the plan that we have in 

place, the implementation of the Affordable Care Act, has done 

that. But we have not seen any alternatives. 

Mr. PALLONE. All right. Let me ask you about CHIP. All the 

Democrats on the Committee recently introduced a bill to extend 

the CHIP program, and I want to emphasize again that we have 

to act on this legislation immediately, when we consider SGR, 

which expires at the end of March. While funding may not expire 

until the end of September for CHIP, in fact, 20 states will finish 

their legislative sessions by the end of April, and more than half 

by June 1, so it is clear that Congress needs to act swiftly to ensure 

states can budget appropriately for CHIP, and avoid any disruption 

in children’s coverage. So, given the bipartisan history of this program, I see no reason why Congress can’t act very soon. 

Can you comment on the impact on states if the CHIP funding 

isn’t extended soon? 

Secretary BURWELL. I would comment on that from two different 

perspectives, one as former director of OMB, and the issues of predictability of funding, and the issues of management, and ability to 

manage. And so, for the states to be able to do that, this is something that is important. When we have had predictability in our 

own budget system, we have seen the benefits of that economically 

throughout the past years—2 years. 

And the other thing I would say is, having just spent a lot of 

time with the governors this weekend when they were in town, this 

37 

is a very important issue to them. We have seen that letter that 

40 governors have signed with regard to knowing that they have 

that predictability of a program that is providing great benefits to 

the children in their states. 

Mr. PALLONE. Now, the Senate and House Republicans have released a CHIP proposal this week, however, this proposal would institute a 12-month waiting period, needlessly forces low income 

children off of Medicaid and onto CHIP, and reduces or completely 

discontinues coverage for children above 250 percent of the Federal 

poverty level, despite the choice of 28 states around our Nation to 

cover those kids. Can you discuss the impact of policies like this 

on some of our most vulnerable children? 

Secretary BURWELL. So we think that the CHIP program is a 

program—bipartisan program, and a program that is working a delivering results, in terms of that quality health care for those children, and has worked. We believe, that is in our budget, a 4-year 

extension of the program, is a very important thing, and that we 

need to do that in a timely fashion to both make sure those children are covered, and receive the care that they need, but also, in 

addition, to have that predictability for states, especially those 

states that are in their legislative process right now. 

Mr. PALLONE. And I know you mentioned the 4-year extension. 

The budget includes a 4-year extension of the CHIP program. Can 

you talk about why that full extension of 4 years is so critical for 

the kids that depend on this health coverage? And maybe also mention, as part of the extension, the budget includes a permanent extension of express lane eligibility. If you would talk about the success of express lane eligibility as an option for states? 

Secretary BURWELL. So the express lane eligibility, and those 

issues, we—folks ask us to try and figure out ways to simplify, to 

make things easier, and that is making things easier in two ways. 

When we hear from folks, it is about both the customer, in terms 

of when they came in, as well as the states. And we believe this 

is a program that has been successful in getting to that simplicity, 

and the simplicity often can work to create either A, better quality, 

or B, lower costs, and so we think that is important—4 years, we 

believe that is a good amount of time, and the right amount of time 

for us to do this extension. There will be interaction with the Affordable Care Act, we know that, and we believe that the 4-year 

period is the right period for us to understand and look at that. 

Mr. PALLONE. Thank you. Mr. Chairman, I would like to submit 

for the record two CHIP articles. The first is an op-ed published in 

the New York Times this month by former Secretary Hilary Clinton, and former Senator Bill Frist, discussing the long term bipartisan history of the program, and the importance of a 4-year extension. And the second article was published in the New York Times 

last month, shows how health coverage for children pays for itself, 

and all the research showing that when children have health coverage, future earnings are boosted. If I could—— 

Mr. PITTS. Without objection—— 

Mr. PALLONE. Thank you, Mr.—— 

Mr. PITTS [continuing]. Ordered. 

Mr. PALLONE [continuing]. Chairman. 

38 

Mr. PITTS. The gentleman yields back. Chair now recognizes the 

Chair Emeritus of the full Committee, Mr. Barton, 5 minutes for 

questions. 

Mr. BARTON. Thank you, Mr. Chairman. Thank you, Secretary, 

for being here. As I have talked to you before, there are lots of 

problems that we have to deal with, you in your position, and the 

Committee in our position. But there are some opportunities for bipartisanship, and one of them is a piece of legislation that we call 

the Ace Kids Act. The original co-sponsors are Ms. Castor of Florida, I think Ms. Eshoo of California, Mr. Green of Texas, myself, 

on the Republican side, along with several other members of this 

committee on the majority side. 

You said in your opening statement that Medicaid is going to be about $345 billion this year, an increase, I believe, of over 16 billion. Well, there is one piece of legislation we could pass on a bipartisan basis that would actually save money in Medicaid, and that 

is the Ace Kids Act. It creates a home for families that have medically complex children, based on an anchor hospital concept with 

the major children’s hospitals in America. I think there are about 

60 of them. So if a parent has a child that is medically complex, 

and qualifies for the program, that child gets access to the network 

on kind of a one stop shop. All the specialties, all the various procedures are provided, and Medicaid is billed on time. We think there 

are about 12 million children that would qualify for the program, 

and we believe that it will save billions of dollars over a 10 year 

period. 

It has been introduced in the Senate, the identical bill, with 

three Republican co-sponsors, three Democrat co-sponsors. So here 

is a rare piece of legislation that both sides of the aisle support. 

The Republican leadership supports it. Chairman Upton supports 

it. Chairman Pitts supports it. Does your department have a position on the bill, and if so, could you explain to the Committee what 

that position is? 

Secretary BURWELL. So with regard to the specific legislation, I 

don’t think we, as an administration, have issued—but what I 

would say is all of the concepts, we agree, and we welcome the opportunity. The idea that we can improve both quality and cost for 

these children, who are very complex, and who are moving state to 

state, and the current system doesn’t afford us the opportunity, 

both with regard to making sure we don’t have duplicative payments, we obviously do not want that, fiscal responsibility, and we 

want that ease that the parent can have the child at the right 

place with the right care, even if it is across state lines. 

So I would just say we look forward to working with you, welcome the opportunity, if there are questions and ways that we can 

provide technical assistance and other things as part of this, we 

welcome that opportunity, because we agree with the fundamental 

of what we are trying to do here, and believe this is something that 

could improve both cost and quality. 

Mr. BARTON. Well, I would encourage you and your department 

to take a look at the bill. It is not illegal or immoral for the Administration to issue a letter of support, and this is one that I think, 

with Chairman Upton and Chairman Pitts, and the Ranking Member in the full Committee and Subcommittee, and leadership on 

39 

both sides of the aisle of the House said this bill could go. It could 

be a part of Chairman Upton’s 21st Century effort, or it could be 

a stand-alone bill. 

I also, in the brief time I have, want to concur with what Ranking Member Green said about community health centers. I hope we 

can work together in a bipartisan fashion to find an answer to keep 

those funded. I know there is a funding issue this year that we 

need to address, and reauthorize the program. I have a number of 

those health centers in my Congressional district, and they are 

very helpful, providing indigent care. 

And, finally, I wasn’t going to ask this question, but I am a little 

bit puzzled. When Chairman Pitts asked you the question about 

this report that deals with planning in case—— 

Secretary BURWELL. Yes. 

Mr. BARTON [continuing]. The health exchanges at the state level 

under the Affordable Care Act are found to not be legal the way 

they are currently funded, if there was a plan, and if you had seen 

the plan, I take you at your word that you haven’t seen the plan, 

but don’t you think it is prudent that there should be a plan? I 

hope I don’t have a primary opponent, I hope I don’t have a general 

election opponent, but I have a plan in case I do. I know you hope 

that the Court upholds your position, but shouldn’t the Administration and your agency have a plan in case it fails? 

Secretary BURWELL. Congressman, what we state in the letter, 

and what we believe is, if the Court decides, which we don’t believe 

they will, but if the Court decides on behalf of the Plaintiffs, if the 

Supreme Court of the United States says that the subsidies are not 

available to the people of Texas, we don’t have an administrative 

action that we could take. So the question of having a plan, we 

don’t have an administrative action that we believe can undo the 

damage. 

And that is why, when I was answering the Chairman, I think 

it is important to understand what the damage is, because then it 

comes to the question of—we don’t believe we have any administrative—— 

Mr. BARTON. So, my time has expired, but if the Court strikes 

it down, the Administration is just going to hold up your hands and 

say, we surrender? 

Secretary BURWELL. We believe the law as it stands is how it 

should be implemented. 

Mr. BARTON. I understand. 

Secretary BURWELL. And with regard to—when the Supreme 

Court speaks, if the Supreme Court speaks to this issue, we do not 

believe that there is an administrative authority that we have in 

our—— 

Mr. BARTON. All right. 

Secretary BURWELL [continuing]. To undo it. And so that is—— 

Mr. BARTON. That is—— 

Secretary BURWELL [continuing]. Something we don’t believe we 

have and—— 

Mr. BARTON. That is puzzling but I accept that. Thank you, Mr. 

Chairman, for your courtesy, and the minority, for letting me have 

extra time. 

40 

Mr. PITTS. Chair thanks the gentleman, and now recognize the 

gentleman from New York, Mr. Engel, 5 minutes for questions. 

Mr. ENGEL. Thank you very much, Mr. Chairman, and welcome, 

Secretary Burwell. Let me piggyback on a backup plan. I was part 

of this committee. I participated in months and months of deliberations for the Affordable Health care Act. We had weeks of markups, 

this committee did, and not once was there mention of subsidies 

not being available to individuals in states that did not set up their 

own exchanges. I have heard a lot of complaints on the other side 

of the aisle about the law, but never was this issue discussed until 

they lost at the Supreme Court in 2012. 

Some of my friends signed on to amicus briefs, and wasting credible time forcing votes on the full repeal of the law, yet they are 

upset that the Administration doesn’t have a backup plan, should 

the Supreme Court ruling threaten the availability of subsidies for 

8.6 million Americans. And I think it is somewhat ironic that my 

Republican friends are demanding that this Administration fix 

problems that they themselves created, and have shown zero interest in fixing. Should Republicans get what they want, and the Supreme Court rules in favor of King, I would urge my colleagues, if 

that should happen, to pass legislation to ensure that Americans 

have continued access to affordable coverage through the Federally 

facilitated exchange, just as Democrats intended. 

Next month the Affordable Care Act will have been the law of 

the land for 5 years. It is not a perfect law, and there are issues 

that need to be changed with it, but I would like to see those issues 

addressed. And let us both of us, in a bipartisan way, turn our 

focus on improving the law, and enabling more quality coverage options for our constituents, instead of trying to kill it, repeal it, take 

it to court, and things like that. So I just wanted to say that I am 

sure that you agree with what I just said. 

Secretary BURWELL. Yes. We look forward to moving forward, 

and we do want to make improvements as we can. 

Mr. ENGEL. Thank you. And I want to use my home State of New 

York as a great example of what is possible when the Federal Government has a willing and enthusiastic partner in the Affordable 

Health care implementation. As a result of our successful exchange 

and Medicaid expansion, more than 2.1 million New Yorkers have 

quality health care coverage. Our state’s uninsured rate has 

dropped to only 10 percent. And there is clear evidence we are 

reaching the right people too, since 88 percent of people who obtained coverage through the exchange reported being uninsured at 

the time they enrolled, so it is really working in New York. And 

the health insurance options available through New York State of 

Health are on average 50 percent cheaper than the comparable coverage available before the exchange was established. 

So I want you to know, I am sure you know it, that the ACA is 

working, and working well in New York, and that is why I really 

think it is terrible that I have been forced to take more than 50 

votes to repeal some or all of this law. We should fix what is wrong. 

But in my state, it has really been a tremendous success. 

Secretary BURWELL. And, fortunately, I have had the opportunity 

to travel the country and see the individuals, those are the numbers, and the individuals, and whether it is Laura in Florida, 26 

41 

years old, married to someone who is a truck driver, who does not 

have coverage. She is training to be an X-ray tech, they have two 

children. They did not have insurance. She now has insurance with 

a premium of $41 a month. Or a woman who had MS in the State 

of Texas, and for 17 years she had not had health insurance. And 

so how people go about—she treated her MS through the emergency room, and she has four children, and she works. And so, 

when it would get bad enough, that is what she would do. And so 

the stories of what it means to people, in terms of their financial 

and health security, I think are—the numbers are important, but 

it is those stories which really make this real. 

Mr. ENGEL. And Secretary Burwell, I understand that we have 

seen robust exchange enrollment nationwide, even in states where 

Republican governors refuse to set up a state exchange, or expand 

their Medicaid programs. Isn’t this true? 

Secretary BURWELL. So the numbers—and I spoke to this yesterday, when we would been able to look at the numbers, 53 percent 

of the enrollees in the marketplace this year, in the Federal marketplace, are new enrollments. And so I think that is indicating 

that—the demand for the product, and the need for the product. 

Mr. ENGEL. Thank you. I want to second Mr. Pallone’s positive 

discussions about CHIP. I have always been a strong supporter, 

and, as of July 2014, an estimated 476,000 children were enrolled 

in this affordable coverage option for their care in New York, and 

so I think that that is really, really important. I was pleased, 

therefore, to see with the budget proposal for fiscal year 2016 included funding for CHIP for the next 4 years, through fiscal year 

2019. So can you elaborate on why you believe increasing tobacco 

taxes is a viable means for funding this program while we sort out 

the transition issues associated with the Affordable Care Act? 

Secretary BURWELL. We believe one of the things of trying to be 

fiscally responsible, and indicating how we are paying for things, 

we believe that this is a legitimate way to pay for things, especially 

in the context of we are providing health care, and something that 

will hopefully create a deterrent, and help health care, in terms of 

the issue of a tobacco tax. As one analyzes across the Department, 

and whether it is at CMS or CDC, the impact that tobacco has on 

health in our Nation, and the cost of health care in our Nation, is 

one that we think is a fair place to go to pay for this care for the 

children. 

Mr. ENGEL. I agree with you. And, finally, I want to talk about 

graduate medical education, because I was concerned that the Administration’s proposal to cut enduring GME funding—one in six 

physicians in America obtains training in my home State of New 

York, and we have some of the finest academic medical centers in 

the country. So you require significant funding and time to develop 

the infrastructure and expertise necessary to ensure quality care is 

available. So how do we ensure stability for these academic medical 

centers, and the patients they serve, if we put GME funding at 

risk? 

Secretary BURWELL. We believe and hope that our proposal does 

not do that, and meets the objectives of making sure we are training appropriate positions for both primary care and specialties, 

where we don’t have as many as we should, at the same time, makVerDate Nov 24 2008 12:31 Jul 13, 2016 Jkt 037690 PO 00000 Frm 00047 Fmt 6633 Sfmt 6633 F:\MY DOCS\HEARINGS 114\114-13 CHRIS
42 

ing sure we target it. There is $100 million for pediatric, and then 

a wider pool for competition. It is an issue that we want to meet 

the same objectives at the same time we do it in a fiscally responsible way. 

Mr. ENGEL. Thank you. Thank you, Mr. Chairman. 

Mr. PITTS. Chair thanks the gentleman. Now recognize the Vice 

Chairman of the Subcommittee, Mr. Guthrie, 5 minutes for questions. 

Mr. GUTHRIE. Thank you, Madam Secretary for coming, and I 

really look forward to working on 21st Century Cures, and all the 

things that we could work on over the next years as Vice Chair. 

But first I would like to direct your attention to the cost share 

reduction program contained in the ACA, specifically Sections 1402 

and 1412. Does any part of this budget request, or does any part 

of this budget that we are talking about today request any new authority, including any transfer authority to pay insurers under the 

cost share reduction program? 

Secretary BURWELL. With regard to the program, which, as a 

program, as you know, is about making sure that the costs of 

health care to this individuals that are coming into the marketplace is something that they afford, that is what it is about, and 

we believe that we do have the authorities to do the cost sharing. 

Mr. GUTHRIE. Is there any new authority requested in this budget? 

Secretary BURWELL. No new language. 

Mr. GUTHRIE. There is no new language? And so we do know it is up and running. I think we spent $3 billion already on the cost 

share reduction program, that are then paid to insurers with taxpayer funds. The budget that is being submitted estimates 11.2 billion over 2015–2016, and CBO says 175 billion over the next 10 

years is what they have estimated. And could you cite where the 

appropriations authority is? You said you do believe you have the— 

can you cite where that is? 

Secretary BURWELL. We do believe we do, and I am sure you 

know that right now this is an issue that is under litigation, and 

a court case that has been brought. And so, with regard to that, 

that is an issue that I will let our colleagues at the Justice Department speak to, because of the place it is in litigation. 

Mr. GUTHRIE. I understand that, but we are doing oversight 

here. I am not an attorney, so—when you were at OMB in 2014, 

there actually was a request in the 2014 budget for direct appropriation, and that didn’t happen, for whatever reason, but we are 

spending money. So whether we spend a penny or 100—this is 

$175 billion over 10 year program. We feel like we—this is an oversight hearing, and so we feel like it is our responsibility to make 

sure to our taxpayers that we have good answers on where this is 

coming from. So we are just asking for where the appropriation 

comes from authority. 

Secretary BURWELL. I understand and I appreciate the question, 

and I am sorry that it is in litigation. I wish we weren’t in a place 

where we are in litigation, but once something has entered into 

that place, it does create a difficult circumstance. I respect the 

issue of oversight, but because the litigation has been brought by 

the House—— 

43 

Mr. GUTHRIE. Yes. 

Secretary BURWELL [continuing]. On this issue, we are in a place 

where I think that is the appropriate place for this conversation. 

Mr. GUTHRIE. We are really—I am just not aware of any pending 

litigation exception at oversight hearing questions, and—is there, 

like, a legal case, or authority, or did the Justice Department say 

you don’t have to—— 

Secretary BURWELL. With regard to issues that are being litigated, generally those are matters that we refer, and let the Justice Department continue on. 

Mr. GUTHRIE. And—that we have never been able to get an answer from the Administration for where the language—nobody has 

even been able to point to us where that appropriation language 

comes from. And it was—and you previously had requested appropriation. 

Let me ask you another question. You had recently said—you received—I think 18 employer groups sent you a letter, urging that 

small groups be maintained at 50 employees. And they were citing 

an actuarial analysis that showed when they go to 50—to 51, actuarial analysis said that it would—estimated that 2⁄3 of the members—so they would receive an increase, and—of 18 percent. And 

I just don’t believe that these small employers, 50 to 100 employees, can accept an 18 percent increase in their premiums. Also, the 

promise that if you like the plan, you can keep it, because if the 

50 to 100 have to go into the new plan, they will have to meet the 

requirements of the health care law that—essential benefits, and 

the other things that have caused other people to lose the plans 

that they liked, that they could keep. 

And due to this impact, would you support allowing states to 

keep their market at 50 or below, not go to the 51 to 100? 

Secretary BURWELL. This is an issue that we are looking at and 

examining because we have a number of comments on it. And what 

I would say is I would welcome the opportunity to see the piece of 

work that you are talking about and referring to so that we can 

see and understand that. I think what we want to do is understand 

the facts around this type of thing, so I would welcome the opportunity to see the study and piece of work that you are articulating. 

Mr. GUTHRIE. OK. My understanding, it has been submitted, a 

letter from these 18 employers, but we will make sure that that 

is—— 

Secretary BURWELL. OK. 

Mr. GUTHRIE. Well, thank you, Mr. Chairman. I yield back. 

Mr. PITTS. Chair thanks the gentleman. Now recognize the 

gentlelady from Illinois, Ms. Schakowsky, 5 minutes for questions. 

Ms. SCHAKOWSKY. Thank you, Mr. Chairman, and thank you, 

Madam Secretary, for being here today. I wanted to ask you if you 

are aware of any Republican legislative proposal that would keep 

insurance companies from denying coverage from people with preexisting conditions, like cancer, or dropping someone from coverage 

because they got in an accident, or got sick? 

Secretary BURWELL. I am not aware of a piece—— 

Ms. SCHAKOWSKY. That is right. 

Secretary BURWELL [continuing]. Of legislation that would take 

care of that issue. 

44 

Ms. SCHAKOWSKY. And are you aware of any Republican legislative proposal that would provide access to preventive services, like 

cancer screenings, yearly wellness exams, and do that at no additional out of pocket cost to consumers? 

Secretary BURWELL. I am not aware of a piece of legislation that 

would do that in the way that the ACA does. 

Ms. SCHAKOWSKY. Thank you. I wanted to talk a little bit about 

something that is a growing concern, and that is Alzheimer’s disease, and the cost that it is in personal lives, and also in funding. 

So scores of public agencies, including many HHS agencies, as well 

as numerous private and non-profit organizations, are trying to address this challenge of preventing Alzheimer’s, serving those who 

have dementia today, finding a cure. Shouldn’t the Federal Government be coordinating a plan on Alzheimer’s? 

Secretary BURWELL. In terms of the issue of coordination, there 

is a body, an advisory group, that includes both people from the 

Federal Government, as well as external folks, to be a part of putting together our thoughts and strategies, and it has informed the 

way that we are doing investments. There are members of the Federal Government across the government, as well as external bodies 

that are a part of that. 

With regard to the work at the Department, the work cuts across 

a number of different areas. NIH and research is generally what 

comes to mind for most people, but where the biggest dollars are 

spent is actually in CMS, and making sure that we are thinking 

through the issues in that space, because that is where the dollars—the other thing is the Administration for Community Living 

is where we work on and think about things like those that are 

caregivers, and those that are going through that process of dementia, and how they deal with it. So at the Department we work 

through all of those. There is this overall advisory group that we 

have externally, and includes internal members. 

Ms. SCHAKOWSKY. So the population is aging rapidly, obviously, 

and Alzheimer’s is taking a much bigger toll than ever on families, 

on health care systems, on people who have the disease, and the 

number of people living with dementia will continue to grow as 

baby boomers age. So you had mentioned the research that is going 

on, so what is HHS, NIH doing to find a cure? 

Secretary BURWELL. So in this budget you see a 24 percent increase to funding for Alzheimer’s, which is much greater than the 

percentage increase even within the other NIH, so focusing deeply 

on doing that. It is also part of the BRAIN Initiative, as we think 

through their specific issues. But we are also making progress on 

something called TAL, which is a protein that is indicative of Alzheimer’s. That is one of the pieces of research that is going on, and 

if we can make progress there—the other piece of research is seeing if there are ways that we can slow the progression by understanding how the neural channels move, and what is happening in 

the disease. Those are pieces of research that we are starting, we 

believe that, with the funding we are asking for, that we can move 

that research—we can broaden it, and we can make it faster. 

Ms. SCHAKOWSKY. So dementia is a major focus of work in the 

United Kingdom and other developed countries. Are we keeping up 

with the rest of the world in research activities and investments? 

45 

Secretary BURWELL. You know, we believe that we are, with regard to that, and I have been in touch with my colleagues and the 

secretary—or the minister in the U.K., and continue to have those 

conversations. So we make sure that we are leaning, and staying 

connected to our colleagues, especially that particular example, 

where I have been in touch with Mr. Hunt, and will continue to 

do that so that we make sure that we are learning everything we 

can from our colleagues. And in places where we can work together, see if we can leverage the efforts that are going on in each 

of our countries. And that is both across the research, the regulation, as well as the more social issues. 

Ms. SCHAKOWSKY. And who is on the Alzheimer’s Advisory Committee? I am asking that because shouldn’t there be a person with 

Alzheimer’s as part of the group? 

Secretary BURWELL. I want to get back to you directly, but it is 

my understanding that there is a person, that there is a slot, and 

that either there is or will be a person that does have that is part 

of the committee. I will want to get back to you on that, though, 

specifically. 

Ms. SCHAKOWSKY. Well, I want to thank you for the focus, and, 

as the coach here of the Seniors Task Force of the Democratic Caucus, I really want to work with you on that, because this is a problem affecting so many families and individuals. I appreciate it, and 

yield back. 

Secretary BURWELL. Thank you. 

Mr. PITTS. Chair thanks the gentlelady. Now recognize the gentleman from Kentucky, Mr. Whitfield, 5 minutes for questions. 

Mr. WHITFIELD. Thank you. Well, Secretary Burwell, I also want 

to thank you for being with us today, and I want to just follow up 

on my colleague Brett Guthrie’s question. We are concerned about 

this cost sharing program because it is $170-some billion dollars 

over a number of years, and we understand that that is one of the 

issues involved in the lawsuit. But all we are asking you is, since 

you all are dispersing the money, what is your opinion as to where 

the appropriation is designated that you are working from? 

Secretary BURWELL. This is an issue—as I said, I understand the 

question. We believe we have the authorities. With regard to the 

specifics of that, because we are in litigation—— 

Mr. WHITFIELD. But you can’t tell us where the money is coming 

from? 

Secretary BURWELL. With regard to having that conversation, 

that is what the—— 

Mr. WHITFIELD. Were you instructed by DOJ not to answer that 

question? 

Secretary BURWELL. With regard to that specific issue, that is at 

the root of the litigation. 

Mr. WHITFIELD. Were you instructed by DOJ not to answer the 

question? 

Secretary BURWELL. With regard to—when there are issues of 

litigation like this, our standard—— 

Mr. WHITFIELD. Well, yesterday we had Gina McCarthy here, 

and we were talking about 111(d), which is before the Supreme 

Court right now, and she gave us her theory of why she thought 

she was right. We are not saying that we are right or you are right, 

46 

we are simply asking what is your theory? Where does the money 

come from, in your view? 

Secretary BURWELL. That is something, as I said—why don’t I 

work to get back to you on where we feel comfortable—— 

Mr. WHITFIELD. OK. 

Secretary BURWELL [continuing]. With regard to where the litigation is, and I would like to come back on that. 

Mr. WHITFIELD. Well, I must say, I have been impressed with 

your facility to use numbers. You are really tuned into the budget, 

responding to Mr. Pitts, responding to Mr. Green about the community health centers. I was at a Rotary Club meeting recently—— 

Secretary BURWELL. Yes. 

Mr. WHITFIELD [continuing]. And I was asked the question—they 

said, Congressman, can you tell us what dollar amount has been 

incurred by the Federal Government as a result of state expansion 

of Medicaid programs pursuant to the Affordable Care Act? Because we picked up a larger percentage of the normal cost. 

Secretary BURWELL. Yes. 

Mr. WHITFIELD. And I would ask you that question. I didn’t know 

the answer, but could you tell me what is the total dollar amount 

incurred by the Federal Government by the expansion of the state 

Medicaid programs as a result of the Affordable Care Act? 

Secretary BURWELL. In terms of the Federal dollars versus the 

state dollars? 

Mr. WHITFIELD. Yes, just the additional dollar—— 

Secretary BURWELL. Yes, I—— 

Mr. WHITFIELD [continuing]. Amount incurred by us. 

Secretary BURWELL. Let me go back and look, because the question of being able to disaggregate whether a person came in because of expansion, or were under the old rules, I think—I would 

want to make sure that we could—— 

Mr. WHITFIELD. But you don’t have a dollar amount for that? 

Secretary BURWELL. I don’t know. I will check with the Department if we do. The one thing that I think we—— 

Mr. WHITFIELD. You would think that you all would definitely 

know that—we can all talk about the advantages and disadvantages of this program, but there is a big additional cost to the Federal Government, and I am asking what is that total dollar amount 

incurred? 

Secretary BURWELL. I think the question that I am not sure is 

how one breaks out the actual number from expansion. Because 

when people come through—— 

Mr. WHITFIELD. Well, let me ask you this question—— 

Secretary BURWELL [continuing]. That is where—— 

Mr. WHITFIELD [continuing]. At what year does—the states were 

encouraged to expand Medicaid, which is fine, because the Federal 

Government is picking up more of that dollar amount. 

Secretary BURWELL. Yes. 

Mr. WHITFIELD. But at some point in the future the Federal Government is not going to be picking up those additional costs. What 

year is that? 

Secretary BURWELL. What year that is is—the Federal Government never goes below a 90 percent of the payment of the additional, and that is—— 

47 

Mr. WHITFIELD. Until when? 

Secretary BURWELL [continuing]. 2020 is—— 

Mr. WHITFIELD. 2020? 

Secretary BURWELL. And so 2016 is the year through which there 

is 100 percent. 

Mr. WHITFIELD. OK. 

Secretary BURWELL. And in your own state—— 

Mr. WHITFIELD. Well, do you have any projected cost over that 

period of time for the Federal—— 

Secretary BURWELL. We do have those incorporated in our budget. But one of the things, in terms of these cost issues, that I think 

are important in the State of Kentucky—— 

Mr. WHITFIELD. OK. Well, that is OK. Listen, you can’t answer 

the question, but I appreciate it anyway. Let me ask you this. I noticed that you all made $2.5 billion in loans in the co-ops, and Kentucky has a good co-op program as well. We sent a letter last year, 

and we were concerned about the solvency of some of these co-ops. 

And the Federal Government, as I said, has loaned $2.5 billion. We 

now see that in Iowa and Nebraska, those co-ops are in bankruptcy. Have you all done any analysis to project—are there other 

states that there is a chance that these co-ops will go into bankruptcy? Are you looking at that? 

Secretary BURWELL. We are looking at the co-ops. The one thing 

I think is very important to note is the cuts, the deep cuts in the 

funding for co-ops. When the program was originally designed, and 

the passage of the Affordable Care Act occurred, the amount of 

money for the co-ops to do the loans, and the loans that states like 

Iowa felt would have made a difference, at the end, because those 

monies were cut, they were cut as part of sequestration. They were 

cut in ’12, they were cut in ’11, they were cut in ’13. 

Mr. WHITFIELD. So are you saying the bankruptcy occurred because of sequestration? 

Secretary BURWELL. What I am saying is that, had we had more 

funding in order to provide the additional loans to the co-ops, it 

could have made a difference. With regard to the fundamental of 

your question, which was are we looking at the co-ops? And there 

are two things that we want to do, understand whether they are 

stable, and then the second is where we can provide technical assistance. 

Mr. WHITFIELD. Well, those questions that you couldn’t answer, 

or were not familiar with, I do hope that you will get back with 

us with those answers soon. 

Secretary BURWELL. Be happy—— 

Mr. WHITFIELD. Within 7 days, if possible. Thank you. 

Secretary BURWELL. I will—— 

Mr. WHITFIELD. Thank you. 

Secretary BURWELL [continuing]. Want to make sure that—we 

will get back as quickly as—— 

Mr. WHITFIELD. Because I have got to be back at that Rotary 

Club next week. 

Secretary BURWELL. As a neighboring state, I appreciate that. 

Mr. PITTS. Gentleman yields back. Chair recognizes gentlelady 

from Florida, Ms. Castor, 5 minutes. 

48 

Ms. CASTOR. Thank you, Mr. Chairman. Madam Secretary, thank 

you again on behalf of the 1.6 million Floridians that were able to 

buy affordable health insurance in our exchange. I will give you 

due credit, and everyone at HHS, but I think the real credit goes 

to our terrific navigators that were on the ground, hospitals across 

the State of Florida, community health centers, and family members that probably put in a good word for their sons and daughters, 

or aunts and uncles, to sign up. You probably want to give them 

a pat on the back yourself this morning. I encourage you to do that. 

Secretary BURWELL. I do. I want to express appreciation. I have 

seen the local stakeholders, and met with them across this country, 

and it was the communities coming together, it was individuals, it 

was people in the community health centers, as was mentioned, it 

was the businesspeople, it was everyone. When I would visit, the 

hospitals would be there, everyone would be around the table working on this issue together, and it was that kind of work—and then 

the individuals that I visited—— 

Ms. CASTOR. OK. 

Secretary BURWELL [continuing]. On Second Sunday in Texas— 

actually was given the opportunity to speak at one of the churches. 

And it was all of that coming together to give this information to 

people so that they could make choices, and have that financial and 

health security. 

Ms. CASTOR. So, in Florida, we have a very competitive marketplace as well. Consumers could choose from 14 different issuers in 

the marketplace this year. That was up from last year, where we 

had 11. And Florida consumers could choose from an average of 42 

health plans in their county for 2015 coverage. 

So with 1.6 million now enrolled, it really demonstrates the high 

stakes involved with the Supreme Court case that the Court will 

hear next week. I cannot imagine that the Court would rule to take 

that away from over a million and a half Floridians, and then millions more all across the country. And just like Representative 

Engel said, I was here during the hearings in advance of the Affordable Care Act, the adoption, during the markup, during the 

amendment process, during negotiations with the United States 

Senate. Never in those discussions was there any dichotomy between a state exchange, and a Federal exchange, and the availability of tax credits. Have you seen any evidence to the contrary, 

in your review of the record, and the case that is before the Supreme Court? 

Secretary BURWELL. With regard—I would let the Justice Department, who has reviewed everything—but the thing that I agree 

with is we we just don’t believe that that is what the law says, or 

what was intended by the law either. 

Ms. CASTOR. Yes, and I can say straightforwardly, as a member 

of this committee, what the legislative intent was, and it was for 

those tax credits to be available to every American, no matter if 

they are in the state marketplace or a Federal marketplace. But I 

would say if the Court rules otherwise, they are going to create 

chaos, and they are going to strike right at the heart of the economic security of so many of my neighbors in Florida, and many 

Americans. So I know that they will study the legislative intent, 

49 

and I hope they rule the right way, and we don’t have the address 

that chaotic situation. 

But I think, with the Affordable Care Act, the real untold story 

is what has happened to people who have insurance, because I can 

cheer on the million and a half Floridians that now have it, but 

most of my neighbors already had insurance, private insurance or 

Medicare, and I noticed some more good news that was announced 

this week for my neighbors that rely on Medicare. Just in Florida 

alone, Floridians have saved almost a billion dollars since 2010 because of the ACA’s donut hole discount. Almost 350,000 beneficiaries saw savings in 2014, to the tune of about $300 million last 

year. The average discount per beneficiary was $884. 

Then, for private insurance—how come we haven’t been able to 

get the word out on how much better an insurance policy is that 

a consumer can’t be kicked off if they get sick? In Florida alone, 

over 200,000 young adults can stay on their parents’ plan. Floridians have received millions of dollars in rebates because the law 

says, you have new rights and protections, and insurance companies cannot spend that money on profits. It has to go to—it can’t 

spend the profits on salaries and excessive profits. It has to go to 

health care. What else can the administration do to tell this good 

news story? 

Secretary BURWELL. I think we can do a better job of making 

sure people do know. And another area is the issue of preventative 

care, and the importance of the fact that your childhood visits and 

those things are no longer—require co-pays or cost sharing, in 

terms of when you go in for that, or measles, an important thing, 

I think, right now, and a timely thing. And so I think we need to 

do a better job of making sure people know about those improvements to quality. 

Ms. CASTOR. Thank you. I yield back. 

Mr. PITTS. Chair thanks the gentlelady. Now recognize the gentleman from Illinois, Mr. Shimkus, 5 minutes for questions. 

Mr. SHIMKUS. Thank you. Secretary Burwell, thank you. I talked 

to your staff prior. I appreciate your outreach, trying to call. It was 

a crazy day, and I talked to them before you—— 

Secretary BURWELL. Thank you. 

Mr. SHIMKUS [continuing]. Came to the table. And I do have 

great respect for that. But I also want to make sure that, you 

know, this happy clap talk about how great health care is, and the 

Affordable Care Act, is moderated by real concerns out there. 

Remember, the bill that passed, signed into law, we had nothing 

to do with on the House side. It was a Senate health bill that came 

over to us that we passed, all right? So that is the health care law 

that we have today, and the language of the law is pretty clear, 

and I am concerned also that the Supreme Court will rule that the 

Federal exchanges and states are not authorized to receive subsidies, and we need to be prepared for that here, and I would hope 

the Administration would be too. 

I promised two ladies from my Congressional district that I 

would mention their names. Angie Esker from Teutopolis, who is 

pro-life, a strong family, and she cannot buy a policy that does not 

have abortion coverage. And for millions of Americans, this is a 

50 

really important issue, and she—this is an emotional—just like on 

the other side, you know how this debate is. 

Secretary BURWELL. Yes. 

Mr. SHIMKUS. And I think part of the agreement from some of 

my pro-life Democrats was to ensure that that option would be 

available—— 

Secretary BURWELL. Yes. 

Mr. SHIMKUS [continuing]. And it is just not for her. The other 

one is Debbie McKinney-Huff from a town called Highland. She is 

a Democrat. Her premiums went up astronomically last year. This 

year they have gone up another $2,000, with a $10,000 deductible, 

and she can’t afford it. So for all the happy dances, there are challenges out there that—we don’t do our constituents service if we 

don’t understand that there are problems that have to be resolved. 

There are some budget requests that I want to talk about, so I am 

going to move forward, but I just put that in the record. 

I am a big supporter of Medicare Advantage. I was here when 

we passed it. Seniors didn’t have any prescription drug coverage. 

It has been very successful, it is very popular. The budget request 

makes a reduction again in that, where the enrollment is going up, 

favorable are high, and 670,000 people weren’t able to access Medicaid Advantage. And if you are from rural parts of this country, 

that option is very limited, or it doesn’t exist. So I would ask that 

we look at that, so that seniors who want to have this option can 

choose that. And our concern is your budget hurts the ability for 

that to happen. 

Secretary BURWELL. So with regard to the first issue, in terms 

of your two constituents, want to make sure we understand that. 

On the issue of the question of abortion, and that—— 

Mr. SHIMKUS. Well, let us just answer this question, because I 

have got to keep more on budget—— 

Secretary BURWELL [continuing]. Medicare Advantage issue. 

Mr. SHIMKUS. Thank you. 

Secretary BURWELL. With regard to that, we want to make 

sure—the program during the period of changes that we have had, 

we have seen a large increase in the number of people in Medicare 

Advantage plans. I want to understand your 670, because 99 percent of beneficiaries have access to MA plans, and there may be 

something, and so I would like to understand that 670 better. 

The third thing is that we know that those number of plans quality that have gone from four stars to the higher ratings, we have 

offered 67 percent in the two highest rating categories, 17 percent 

to 67 percent, so we are improving quality. More people are coming 

in the system, and there is premium control, so I want to understand the 670. We want to make sure, and are listening. We alter 

our plans as we hear concerns. That is why I want to understand 

that 670, because we believe that we can continue making these 

changes. It comes back to some of the points the Chairman raised 

with regard to deficits, and making sure that—— 

Mr. SHIMKUS. OK. 

Secretary BURWELL [continuing]. We are being responsible. 

MedPAC and the GAO have recommended that there is upcoding, 

and we need to work on it. 

51 

Mr. SHIMKUS. OK. Thank you. Are you aware of any efforts by 

FDA to accelerate the next round of user fee negotiations? And our 

concern is, if they are, and they are not doing due diligence about 

the fees and the return on investment, we would hope that they 

would not accelerate it until due diligence is done. 

And the last thing I wanted to address was the Biologics Price 

Competition and Innovation Act. Stakeholders have to be involved 

in that. That is really part of the 21st Century Cures debate, not 

just having bureaucrats or panels, but bringing patients, bringing 

physicians, bringing in alike—and our concern is that is not happening on this—on the Biologics Price Competition and Innovation 

Act, and those concerns. 

So if you would take that for suggestions, and if you want to 

come back and follow up on a lot of these issues, we would be 

happy to talk with you again. I do appreciate you reaching out personally, and I look forward to working with you. 

Secretary BURWELL. I do appreciate this issue of stakeholder 

input. We think it is important to making sure we get this right. 

Mr. SHIMKUS. Thank you very much. 

Mr. PITTS. Chair thanks the gentleman. Chair now recognizes 

gentlelady from California, Ms. Matsui, for 5 minutes for questions. 

Ms. MATSUI. Thank you, Mr. Chairman. Secretary Burwell, 

thank you for being here. I want to talk about mental health. 

When we think about health, we need to consider the whole person. 

Mental health has historically taken a back seat to physical health, 

but the head is connected to the body, and one affects the other. 

I have been working for years with my colleagues on both sides 

of the aisle, and both sides of the Capitol, to make changes to fix 

our broken mental health system. And as you know, a demonstration project based on the Excellence in Mental Health Act, that I 

co-authored with my colleague here, Congressman Lance, into law 

last year, and I look forward to working with you and the Administrator to make sure this is implemented properly, and in a way 

that states can demonstrate success. 

I also look forward to working with you to make further changes 

and improve our mental health system. I was pleased to see that 

the budget will eliminate Medicare’s 190 day mental health services more in line—and keep that more in line with physical, for 

which no limit exists. Can you briefly talk about that policy, and 

how it would benefit seniors and people with disabilities who need 

psychiatric services? 

Secretary BURWELL. Our overall approach in the mental health 

space, and it is one that we consider a priority, is to try and get, 

in terms of both care and payment, to parity with how we think 

about other health issues. And there are steps that we are taking 

throughout the budget, and whether it is the implementation of the 

piece of legislation that you referred to, and the issue that your colleague just raised about stakeholder engagement, and making sure 

we are getting that input as we implement. So we are implementing, and thinking about the policies to promote behavioral and 

mental health through our payment system, and making sure that 

there is parity. That seems to be something that is been important. 

We are trying to focus on access, because many people—the question of access to the right types of providers, in terms of behavioral 

52 

health, that is something you see in some of our now is the time 

budgeting work, in terms of making sure that SAMSA and others 

are ensuring that we have providers. And then there is access, and 

that is an issue for all people of all ages, but especially young people getting the access that they need. 

So as we think about all the pieces working together, about the 

funding, about the access, and then that there are providers that 

can provide. 

Ms. MATSUI. I appreciate that, and as we move forward, there is 

a continuum of mental health issues that we need to address. And 

it is a complicated issue, and we would certainly like to work with 

you as we move forward on that. 

And now I would also like to talk about seniors, because that is 

a special interest area of mine too. And, as we consider changes to 

the Medicare program, our first priority should always be seniors, 

especially knowing that seniors spend about 14 percent of their 

household income on health care costs, compared to five percent— 

households who do not have a Medicare beneficiary. And we need 

to find ways to save money in the Medicare program, and we have 

been, but not by cutting benefits, but by re-aligning incentives to 

improve outcomes in patient care. If a senior gets the right care at 

the right time, it is not only better for the senior, but also saves 

the system a lot of money. 

Now, I appreciate some of the provisions in the budget, and I 

would like to discuss these further with you. The budget seeks to 

save money by restoring drug rebates for the dual-eligible population on Medicare. Secretary Burwell, can you please elaborate on 

that? 

Secretary BURWELL. In terms of the dual-eligible—— 

Ms. MATSUI. Yes, right. The drug rebates for dual-eligible population. 

Secretary BURWELL. One of the things that—the dual-eligible 

population has two elements to it. Is both a very complicated population—— 

Ms. MATSUI. Yes. 

Secretary BURWELL [continuing]. Because they are people who 

have a number of different conditions that are being treated in different ways. It is also a very expensive population. And as we work 

to improve both the quality and affordability of the care, that is 

what we are trying to do, as we look at these proposals. And it is 

all a part of the broader issue of delivery system reform, which you 

touched on a little bit, and we have set out clear goals. 

For the first time ever we have said that in the area of Medicare, 

that by 2016 we have set a goal that 30 percent of all payments 

will be in different payment systems, where we are not paying for 

volume, but paying for value. And as a part of—we move forward 

to this change system, we want to do that. That is about price, but 

it is also about quality, and this is a proposal that we are trying 

to move forward on both. 

Ms. MATSUI. And I know that this is going to be difficult because 

there are areas where you have to look at the budget, but as we 

look at this, we have to also look at the seniors. And that is really 

why, when we look at this—I know you seek to increase the skin 

in the game for Medicare beneficiaries, however, I would argue 

53 

that seniors already have a lot skin in the game, and Medicare, 

and the additional cost sharing, will not bring down costs in the 

program. 

And as you know, as they have increased costs, you look at— 

most of them are supported by Social Security, and then that— 

what they do is shift over the costs to pay for their health care 

from Social Security. So I think it is something we really have to 

look at more holistically. So thank you very much for everything 

that you are doing. 

Secretary BURWELL. Thank you. 

Ms. MATSUI. Yield back. 

Mr. PITTS. Chair thanks the gentlelady, now recognizes the gentleman from Pennsylvania, Dr. Murphy, 5 minutes for questions. 

Mr. MURPHY. Welcome here, Madam Secretary. We appreciate 

you being here. I also want to associate myself with the comments 

of my friend, Ms. Matsui of California, about mental health, and 

look forward to working with you on those things. 

In a related area, we have had a number of hearings here regarding mental health, and among them has been the Substance 

Abuse and Mental Health Service Administration. We have asked 

them repeatedly for information over almost a year for getting 

some records. Chairman Upton and I have asked for these things. 

We have not gotten those documents, and we are concerned about 

their delays. I wonder if you could help us get some assurance that 

we will get those documents from SAMSA? 

Secretary BURWELL. As you and I had the opportunity to discuss, 

this is something that we are working on, and I am hopeful that 

very soon you will have some of those documents, and we will continue to work with you on it. 

Mr. MURPHY. Thank you. I appreciate your teamwork on this. On 

another question, when we passed the SGR patch, I think it was 

last year, there was also a demo project, which is what Ms. Matsui 

was also referring to, for certified community behavioral health 

clinics to improve access. 

Secretary BURWELL. Yes. 

Mr. MURPHY. Now, as part of this, we also attached something 

for AOT, assisted outpatient treatment, for counties and communities to also have access to some grants to facilitate that, as long 

as they also were—so those community behavioral health clinics 

would get those—to also help for those who are cycling through 

with histories of violence, prison, homelessness, et cetera. That 

small one percent of one percent that are persistent chronically 

mentally ill going through the system. 

One of the things I want to make sure and find out from you is— 

the way this was designed is to make sure that only those counties 

who really have AOT would be eligible for those grant programs, 

if they are going to attach those to those community health centers. 

Is that something you are aware of, and can you work with us to 

make sure that those grant programs are available in that sense? 

Secretary BURWELL. We do want to work with you on that, and 

yes, we are working on that, and would like to work with you to 

make sure that we do have those standards in—— 

54 

Mr. MURPHY. Thank you. Another one has to do with a program 

that was discussed by SAMSA which is called iCare, which is to 

help with those going into emergency rooms—— 

Secretary BURWELL. Yes. 

Mr. MURPHY [continuing]. To deal with those in crisis. One of the 

concerns I have, and certainly we have seen headlines, some tragic, 

sad cases, such as that with the Virginia Senator, Creigh Deeds, 

his son Gus. The problem is that there are thousands this occurs 

in this country every year, where there just simply aren’t enough 

psychiatric hospital beds, and so people languish in emergency 

rooms, often in a five point tie-down, and given chemical sedatives 

until a room opens up. It could be hours, or days, or weeks, in some 

cases. We wouldn’t have this problem if we had more psych beds. 

And so I am hoping that, since the demand for psychiatric beds 

exceeds the current supply of inpatient psychiatric beds, that is 

something else you can work with us in legislation to say, we ought 

to have a place for those in crisis to get stabilized, not go to jail, 

not sit in a jail cell and languish there, or sit in an emergency 

room, but work with us on that. Would you be willing to work with 

us on that too? 

Secretary BURWELL. Yes, looking—— 

Mr. MURPHY. Thank you. 

Secretary BURWELL [continuing]. Forward to that. 

Mr. MURPHY. And another issue, then, related to the assisted 

outpatient treatment grant program as a stand-alone thing, I want 

to show you—I think I have a poster here of—I just want to show 

you some of the outcome measures. This comes out of a Duke University study. 

Secretary BURWELL. Yes. 

Mr. MURPHY. And when you have assisted outpatient treatment, 

so working with someone from the court, or judge, working with a 

person, saying, you need to stay in treatment for a number of 

months, outpatient treatment, not inpatient, take your medication, 

see this person to report back, like with the mental health court 

or something, they saw an 87 percent reduction in incarcerations, 

an 83 percent reduction in arrests, 77 percent reduction in psychiatric inpatient hospitalizations, and a 33 percent reduction in 

ER hospitalizations. So I just want to show you that too. And, by 

the way, the costs are cut in half for these folks too. 

But there is one that—in working with the issues of CBO scoring, et cetera, we are really going to have to, I think, team up together on this, and say there ought to be some options for people 

to be in outpatient care. And this is psychiatry, psychology, peer 

support, social workers, people helping with job training, housing, 

all those things together, but there has to be this coordination of 

programs. You will work with us on this too? 

Secretary BURWELL. Well—and I think it is part of the broader 

issue of delivery system reform, and how we deliver quality. You 

are focused in a very important area, in mental health. When we 

look at diabetes, in the clinics that I have visited across the country, when we get these adherence numbers up, and people participating, and that usually has to do with coordinated care, and the 

type of interaction and communication you are talking about, we 

get adherence, we get less of the disease or problem, and we get 

55 

lower costs because the things that happen when we have the bad 

things that go wrong when people aren’t adhering. 

Mr. MURPHY. Yes, it is going to require that different view of 

some things. And I think you may be familiar with the hearing we 

had in the Oversight Committee 2 weeks ago, where a GAO report 

identified—I was amazed by this—112 Federal agencies and programs, scattered across eight departments, that deal with mental 

illness. They said the interagency coordination program supporting 

individuals with serious mental illness is lacking. It was, to me, a 

really dizzying and sad description of the process here. I hope you 

will also work with us as we work to coordinate those programs. 

And can I have that assurance from you as well? 

Secretary BURWELL. We will, and we do coordinate. We coordinate them across the overarching issue, and then within their 

areas, like veterans’ homelessness, and the issues that relate. And 

so I want to have the conversation about how we think about 

where we can strengthen those things. 

Mr. MURPHY. Thank you. Let us continue work with that. Thank 

you, Mr. Chairman. I yield back. 

Mr. PITTS. Chair thanks the gentleman. Now recognize the gentleman from Oregon, Mr. Schrader, 5 minutes for questions. 

Mr. SCHRADER. Thank you, Mr. Chairman. Thank you for being 

here, Madam Secretary. 

Secretary BURWELL. Thank you. 

Mr. SCHRADER. Last year health care spending grew at the slowest rate on record since 1960. Health care price inflation is at its 

lowest rate in 50 years, and the ACA’s gotten a lot of attribution 

by CBO for making a big difference in that result. Have you seen 

Republican legislative language that would give us that same result? 

Secretary BURWELL. We haven’t seen a proposal that would continue us on our path with regard to some of the changes we have 

put in place. 

Mr. SCHRADER. Seniors have also benefitted dramatically from 

the ACA. Prescription drug costs are a big issue for them. 

Secretary BURWELL. Yes. 

Mr. SCHRADER. Over eight million seniors have actually bene- fitted from, and saved, over $11 billion, as I understand it, on prescription drugs since the enactment of the ACA. Is there a Republican proposal out there that does a similar thing? 

Secretary BURWELL. We haven’t seen a proposal that would take 

care of this issue, the donut hole. And, actually, on Tuesday we actually were able to update our numbers in that space, and it is now 

$15 billion in terms of the savings. And on average in the country, 

that is about $1,600 per—— 

Mr. SCHRADER. I find that ironic, that my colleagues on the other 

side of the aisle keep asking for a contingency plan from the Administration on this bogus lawsuit, and yet, as a firm believer in 

Article I, legislative supremacy, with all due respect, Madam Secretary, I think it is our responsibility, and the majority party controls both chambers, where the heck is their contingency plan? 

That is a rhetorical question, Madam Secretary. 

One of the things that has been really good, I think, in my state 

is the expansion of the Affordable Care Act into the Medicaid popuVerDate Nov 24 2008 12:31 Jul 13, 2016 Jkt 037690 PO 00000 Frm 00061 Fmt 6633 Sfmt 6633 F:\MY DOCS\HEARINGS 114\114-13 CHRIS
56 

lation and into the private sector. We have had some unqualified 

success. Emergency room visits are down, like, 21 percent. We have 

actually gotten hospital admissions, complications from diabetes 

alone down nine percent, not to mention other diseases. COPD, 

Chronic Obstructive Pulmonary Disease, hospital stays down almost 50 percent. Are you getting any of the same—those same type 

of results from other states? What—could you—— 

Secretary BURWELL. So we are, and recently, actually, in the last 

2 weeks, out of the State of Kentucky, we have seen a piece of 

analysis done by the University of Louisville in Deloitte, and that 

piece of analysis showed they did it at the beginning of the expansion, and then they did the analysis now. And what the analysis 

showed is that the expansion will contribute to 40,000 jobs in the 

State of Kentucky, and will contribute to their GDP by $30 billion. 

And that is the period to 2021, so that is over a period of time. But 

we are starting to see both the economic and job impacts, as well 

as some of the health impacts that you were describing. 

Mr. SCHRADER. Well, contrary to popular demagoguery on rightwing radio and TV, this is a marketplace system we set up. Federal 

Government is the facilitator in that. The state—some of the state 

exchanges are a facilitator. Like everyone, I think, here, we all believe in the power of marketplace competition. My own state, for 

instance, over the last year, instead of seeing the double digit increases in insurance premiums on average, ours actually stayed 

level, or decreased slightly. 

That, to me, is a key indicator for the working or non-working 

of the Affordable Care Act. Our uninsured rate in Oregon went 

down 63 percent. I have had testimonials from hospitals and doctors about how people actually have health care access at this point 

in time. Could you talk about what you see nationally in increased 

competition—— 

Secretary BURWELL. So with regard to the issue of increased 

competition, we saw 25 percent more issuers come into the marketplace this year, and so more issuers means more plans and competition. 

Mr. SCHRADER. They wouldn’t be doing this if they weren’t making some money at this, and the program wasn’t working, Madam 

Secretary. 

Secretary BURWELL. And so—and also, with regard to the issue 

of competition, what we know is, in many plans that are employerbased plans, people do not come in and shop. They just automatically re-enroll. And, as you know, we had that as part of the marketplace this year. But we know that, actually, the majority of people came in and shopped. And that, I think, is related to the competition, and it is related to a consumer who wants to make the 

best choice. And that choice, sometimes based on benefit, that 

choice sometimes based on cost, and cost has a number of different 

elements, whether that is premium or deductible. 

Mr. SCHRADER. Correct. 

Secretary BURWELL. So we are seeing more players come in, and 

we are also seeing the consumer behave in a way that is indicative 

that they want that competition and shopping. 

Mr. SCHRADER. I would like to call out some kudos on the GME 

increase in the budget, the money you put in for Medicare appeals. 

57 

Back home we do a lot of work, of course, with people that are having trouble navigating the system big time, and the investment in 

primary care docs. I think that is important. 

Quick little comment, the only thing I am a little concerned 

about is if we are going for bundled payments and increased competition, why we are hammering on the Medicare Advantage plans 

a little bit? 

Secretary BURWELL. As I mentioned to your colleague, I think 

what we are trying to do is balance, making sure that those plans 

are good and strong, and we have seen that over the period of the 

changes we have done. We try and do the changes in a measured 

way that gets to things that actually have to do with what we believe is strong representation of the taxpayer, in terms of places 

where we believe there are issues, like up-coding, that is occurring, 

and that MedPAC has articulated those, and others. We always 

want to listen and hear, and we want to watch carefully if we are 

seeing problems that occur with the changes, and to date, we 

haven’t. 

Mr. SCHRADER. Thank you, and I yield back. 

Mr. PITTS. Chair thanks the gentleman. Now recognize the gentleman from New Jersey, Mr. Lance, 5 minutes for questions. 

Mr. LANCE. Thank you, Mr. Chairman. Madam Secretary, regarding King vs. Burwell, I understand what you have said, that 

there can be no administrative action should the Plaintiff win the 

case. You have stated that explicitly, and repeatedly, and that this 

not my question. My question relates back to the Chairman, who 

said in his opening line of questioning, that we have a specific 

source within your department that there is a document related to 

what HHS might do, should the Supreme Court rule against the 

Administration. I understand that your point of view is that there 

can be no administrative action. You have stated that explicitly. 

Are you aware of any such document? And I am not asking you 

about your position on administrative action. I am asking about a 

document in this regard. 

Secretary BURWELL. Congressman, if there is this document, and 

you know of it, I would certainly like to know of the document, because I don’t have knowledge of a 100 page—— 

Mr. LANCE. I didn’t say 100 page, now did I? 

Secretary BURWELL. Sorry. 

Mr. LANCE. I just said a document. 

Secretary BURWELL [continuing]. Chairman—— 

Mr. LANCE. I don’t know how many pages it is. You are not 

aware of any document? 

Secretary BURWELL. As I have said, there isn’t administrative action—— 

Mr. LANCE. Yes, I have made that clear that I understand your 

point of view on that. Is there a document as to a reaction from 

HHS should the case be won by the Plaintiff in the Supreme 

Court? 

Secretary BURWELL. With regard to a reaction, as I said—because I have articulated that—I want to be careful, because I have 

articulated—— 

Mr. LANCE. As I have tried to be careful. 

58 

Secretary BURWELL [continuing]. The problems with regard to 

the question of what will happen, we know how many people are 

in the marketplace, how many—— 

Mr. LANCE. Yes. That is filibustering. I understand that. I am 

asking whether there is any document, we have a source indicating 

there is a document, as to what might be the response from HHS? 

Secretary BURWELL. I am not familiar with the document you are 

referring to. 

Mr. LANCE. And let me say that a former CMS administrator, 

Tom Scully of, I believe, the Bush Administration has said, of 

course they have a document. He said, of course they have one, I 

think he referred to a document, they should all resign if they 

don’t. I would hope that your department, Madam Secretary, would 

have some sort of contingency plan should the Court rule for Plaintiff. Do you believe that the suit is bogus? 

Secretary BURWELL. With regard to the lawsuit, as I said, what 

I believe is that the law is clear—— 

Mr. LANCE. Yes, I understand that. Do you believe the suit is 

bogus? 

Secretary BURWELL. That is a characterization. I—my point 

about the suit is—what I believe is that we hold the right position, 

and that our position—— 

Mr. LANCE. Yes, I understand that, and it will be argued next 

week, and a decision will be made by the end of June. Formerly, 

when I asked questions about this, not from you, but regarding 

prior officials, there was the impression that it was a frivolous suit. 

Do you believe the suit is frivolous or bogus? 

Secretary BURWELL. What I believe is that we should continue 

making progress for the American people on three things that the 

Affordable Care Act—— 

Mr. LANCE. Yes, I am aware of that. Do you believe the suit 

is—— 

Secretary BURWELL [continuing]. Access—— 

Mr. LANCE [continuing]. Frivolous or bogus? 

Secretary BURWELL. May I finish, Congressman? I believe that 

we, as the Executive Branch and the Legislative Branch, should be 

working together on three things we agree with. That is affordability, access, and quality. 

Mr. LANCE. I agree with all—— 

Secretary BURWELL. And what I would hope that we can do is 

build on the progress that we have seen. And that progress is that 

11.4 million people—— 

Mr. LANCE. Reclaiming my time, do you believe that the Supreme Court is likely rule unanimously on this decision? 

Secretary BURWELL. As I have indicated, we believe that the 

Court will rule in our favor. 

Mr. LANCE. Yes. Do you believe the suit is bogus or frivolous? 

Secretary BURWELL. With regard to characterization, what I 

think is valuable is that we believe that our position is the position 

that will stand, and that we believe we are right. The people in the 

State of New Jersey should not have their subsidies taken away because they do or don’t have a marketplace, when people right 

across the border in New York will get those—— 

59 

Mr. LANCE. I believe, Madam Secretary, in equal justice under 

law, as is inscribed across the street on the Supreme Court building. I believe this is a very serious case. I think it is closely contested. Under no circumstances do I believe that Plaintiff will win 

nine to nothing. I think there are good arguments on both sides. 

I have read the briefs, all of the briefs. I have read the Solicitor 

General’s brief. I have read the brief of the Plaintiff. I think it is 

a very serious case, and you and I may disagree on the case. I respect that, and I understand that. 

It is frustrating to me that, here in Washington, there cannot be 

an intellectual argument as to pros and cons, and I certainly would 

encourage the Administration to have a contingency plan, and to 

work with us in Congress, including the Republican majority in 

both the House and the Senate, should the Court rule for Plaintiff. 

Thank you, Mr. Chairman. 

Secretary BURWELL. Congressman, with regard to the question of 

our authorities, what you just ended with was the issue of the legislation, and I want to make sure that I touch on that. As we have 

said all along, we are willing, and look forward to working with the 

Congress on any legislation that would work on those three things 

we talked about, affordability, access, and quality, and preserves 

the economy, and supports working middle class. That is how we 

will look at legislation. We want to do that now, and we want to 

do that in any—— 

Mr. LANCE. And I was part of a group that had an alternative 

piece of legislation that didn’t see the light of day put forth by the 

Tuesday lunch group, of whom I am a member of that group. It 

was different from the Affordable Care Act, but it was an alternative piece of legislation. Of course, it didn’t see the light of day 

in any way, shape, or form in 2009 and 2010. Thank you, Mr.—— 

Mr. PITTS. Chair thanks the gentleman. Now recognize the gentleman from Massachusetts, Mr. Kennedy, 5 minutes for questions. 

Mr. KENNEDY. Thank you very much, Mr. Chairman. Madam 

Secretary, thank you very much for being here. You touched on, a 

moment ago, about legislation that you said you were eager to 

work with Democrats and Republicans on. Have you seen any such 

legislation? 

Secretary BURWELL. With regard to legislation that would promote and move forward on those three things, making sure we are 

expanding that insured population, have not seen things that 

would work toward that. 

Mr. KENNEDY. Madam Secretary, are you aware of how many 

bills were passed and signed—or bills were passed by the 115th 

Congress? 

Secretary BURWELL. I don’t know the exact number. 

Mr. KENNEDY. Give or take a few, 931, ballpark, sound about 

right? Any idea on how many of those bills were signed into law? 

296 sound about right? Any idea how many times in my first term 

in Congress we repealed all or part of the Affordable Care Act? 55 

sound about right? Any idea how many times those were signed 

into law? None. 

Secretary BURWELL. None. 

Mr. KENNEDY. Are you aware of how many times we voted on 

some sort of replacement bill to the Affordable Care Act, that we 

60 

voted to repeal 55 times, to provide Americans with quality affordable access and financial assistance to access to health care that 

they deserve? None. 

Secretary BURWELL. I think the number is none. 

Mr. KENNEDY. OK. I would agree with you. So I think, given all 

of the discussion we have had over the course of the past several 

hours about contingencies, about other options, in the time that I 

have been in Congress, over 55 times in my first term, including 

another time in my second term, to repeal all or part of the Affordable Care Act, and under the time that I have been here under Republican leadership, to not have a single bill that has seen the 

House floor to vote on an alternative to provide quality, affordable, 

accessible health care to millions of Americans, I would respectfully 

ask, as my colleagues have, for the Administration to work with 

Democrats and Republicans to work on any such legislation, should 

they decide to bring that to the light of day. 

Secretary BURWELL. And in our budget, I would just like to mention we actually do have a proposal to improve the small business 

provisions of the Affordable Care Act, to try and both simplify and 

make the tax credits better for small businesses. That is feedback 

we have received about that, and that is something that is included 

in our budget. 

Mr. KENNEDY. Now, turning to a couple—well, hopefully more 

substantive questions that I can get to with you, Madam Secretary, 

I was pleased to see that the Democratic CHIP reauthorization bill, 

that the was included in the President’s budget extended the Medicaid primary care payment increase. The rate of increase that was 

initially included in the ACA has been absolutely critical, and for 

the last 2 years, it has boosted payments to doctors who treat the 

most vulnerable populations, making access an attainable goal, not 

just an aspirational target. 

According to a recent report from the Urban Institute, however, 

the expiration of that payment bump at the end of last year will 

result in Medicaid provider payments that are going to be cut on 

average of 43 percent, and over 50 percent in some states. The impact on wait times could be drastic and immediate. I was hoping, 

Madam Secretary, you might be able to comment on the importance of parity between Medicare and Medicaid payment to our primary care providers, and when they have to choose between seeing 

some of most vulnerable populations like seniors, pregnant women, 

and children, why would there possibly be a reimbursement discrepancy? 

Secretary BURWELL. So, I think, as you are indicating, why we 

have proposed the continuation of these payments is because we 

believe it is making a difference, and it is making a difference to 

the access and coverage that people are getting in the system. And 

so we have proposed it as a continuation, and we hope that that 

is something that the Congress will consider and support. 

Mr. KENNEDY. Thank you. The second topic that I want to touch 

on today, actually, my colleague, Mr. Murphy, touched on it quite 

extensively in his comments, but it is about substance abuse and 

mental health. Back in Massachusetts, Madam Secretary, I see 

communities on the front lines of a growing and extraordinarily 

devastating opiate abuse crisis, and we are looking to the Federal 

61 

Government for some support as prescription drug abuse, and a 

number of heroin overdoses, continue to mount. 

Madam Secretary, I was a prosecutor before I ran for office. I 

saw the impacts of this on a daily basis, not just in terms of addiction and people needing treatment, but in terms of property crimes, 

personal crimes for folks that are looking to try to find a way to 

get help, but the treatment options just aren’t there. There are not 

enough doctors. There are not enough beds, as Mr. Murphy indicated. There are not enough wrap-around services. There are not 

enough care. And I was hoping that you might be able to touch on 

the importance of actually creating these incentives through Medicaid largely, which is our largest mental health provider, to actually make sure that—not just another grant program, but to make 

sure the incentives are in place to allow that marketplace to provide that care? 

Secretary BURWELL. So the bad news is, as you indicate, there 

were 259 million prescriptions for painkillers, opioids, during 2012. 

That is more than one per adult in the Nation. That is the bad 

news. The good news is that I believe that there is bipartisan support for us to do something, and I believe that that is both in the 

Executive and Legislative Branch here in Washington, D.C., as 

well as with the governors, who I met with over the weekend on 

this issue. 

I think with regard to payment, it is an important place, but 

there are three fundamental things that we believe we need to 

work with the Congress and work with the governors to do. One 

is, in terms of the prescribing, that is at the root of much of the 

problem. We have seen progress in states like Florida, where they 

are watching the prescribing. The plans that states can put in 

place to oversee that is an important part, but we have a part two. 

Second is the issue of things like—and access to those, which I 

think gets to some of the payment issues. And the third is making 

sure there is medical treatment, and I think that was the third 

part of what you were mentioning. Those three elements, I think, 

is—that is a basic agreed upon. 

And whether it is Senator Portman and Senator Widen, or Mr. 

Rogers, or—it is across the board. There is bipartisan support because states from Massachusetts to Kentucky, and West Virginia, 

my own home state, are suffering in devastating ways. And the one 

piece you didn’t mention, which is the economic impact. And, having come from a large employer like Walmart, what it means in 

terms of having an employee base that can pass a drug test. 

Mr. KENNEDY. Thank you, Madam Secretary. 

Secretary BURWELL. Thank you. 

Mr. PITTS. Chair thanks the gentleman. Chair will note that we 

have just been joined by a group of students from the Houston 

area. The Ranking Member has informed me—you want to say 

anything, Gene? 

Mr. GREEN. Mr. Chairman, I would just like to recognize a number of our chiropractic students from the Houston area, and Dr. 

Mossad, who actually retired as the president of our chiropractic 

college in Pasadena, Texas. And I invited them last night because 

I wanted to show how the health care policy is made in the health 

care subcommittee. Thank you, Mr. Chair. 

62 

1The report has been retained in committee files and is also available at http:// 

docs.house.gov/meetings/if/if14/20150226/103028/hmtg-114-if14-20150226-sd008.pdf. 

Mr. PITTS. Thank you. You are certainly welcome to be here. And 

the Chair now recognize the gentleman from Virginia, Mr. Griffith, 

5 minutes for questions. 

Mr. GRIFFITH. Thank you, Mr. Chairman, I appreciate that. Appreciate the students being here. We may have some disagreements 

today, but I will tell you that the Ranking Member, Mr. Green, and 

I worked very hard on a health care bill that was signed into law 

last year, so no matter what you may see today, we do get along 

more often than the press lets you know. All right. 

That being said, Madam Secretary, in response to a previous 

question, you indicated you weren’t aware of any of the laws being 

signed in. I am sitting here with a CRS report, Congressional Research Service, indicating that there are 12 bills that repealed 

parts of Obamacare that were, in fact, signed into law. You are not 

aware of that, is that correct, in relationship to your previous answer? 

Secretary BURWELL. With regard to the specifics of the answer, 

those were repeal questions, I thought. 

Mr. GRIFFITH. Yes, and this was part—— 

Secretary BURWELL. Full repeal. 

Mr. GRIFFITH. He said—— 

Secretary BURWELL. Full repeal was—— 

Mr. GRIFFITH. He said full or a part. So you were mistaken, and 

weren’t aware of these 12 that were partially repeals? 

Secretary BURWELL. I was referring to the issue of full repeal. 

Mr. GRIFFITH. But you are aware of these? 

Secretary BURWELL. I would have to look and see—— 

Mr. GRIFFITH. OK. And if I could just have this entered into the 

record, I would appreciate—— 

Mr. PITTS. Without objection, so ordered. 1

Mr. GRIFFITH. Thank you, Mr. Chair. Also, are you familiar with 

my H.R. 130? 

Secretary BURWELL. Apologize, don’t know what that bill is. 

Maybe if it is described I might—— 

Mr. GRIFFITH. And are you—it is a bill that deals with the black 

lung provisions of Obamacare. 

Secretary BURWELL. I am not familiar with that—— 

Mr. GRIFFITH. I appreciate that. Are you—— 

Secretary BURWELL [continuing]. Legislation. 

Mr. GRIFFITH [continuing]. Familiar with my H.R. 790, which is 

the Compassionate Freedom of Choice Act? 

Secretary BURWELL. Not familiar with the specific names of the 

legislation—— 

Mr. GRIFFITH. And I appreciate that. And are you familiar with 

H.R. 793, which deals with preferred pharmacy networks and Part 

D? 

Secretary BURWELL. Depending on a—— 

Mr. GRIFFITH. Another one of mine. 

Secretary BURWELL [continuing]. Description, that may—— 

Mr. GRIFFITH. And so the reason I ask those questions is—been 

very well orchestrated today, from a political standpoint. The other 

63 

side of the aisle has asked you repeatedly are you aware of Republican legislation that deals with the issues that we are dealing with 

related to Obamacare? I would submit to you that, in some way or 

another, the three points that you pointed out, each one of those 

bills did. You are not intimately familiar with them, and I understand that, and I am not blaming you, because you have been put 

into that unenviable position that sometimes happens, where there 

is a difference between negative evidence, and a lack of evidence. 

And what you presented today is a lack of evidence, and I appreciate that. 

That doesn’t mean that these bills don’t exist, just as I gave you 

the numbers on those three. It doesn’t mean that there aren’t other 

bills that other members have that are out there that are Republican proposals to take care of the American citizen while we are 

in the process of repealing Obamacare. And so you are just submitting that you are not aware of it, but there are, in fact, bills out 

there that may be doing that, and also further discussions behind 

the scenes that may be doing that that you are unaware of. Isn’t 

that correct? 

Secretary BURWELL. Would welcome—there was a veterans’ bill 

that we all agreed on. The firefighters, I haven’t—— 

Mr. GRIFFITH. I am just saying, though, that—— 

Secretary BURWELL [continuing]. Legislation—— 

Mr. GRIFFITH [continuing]. When you say, though, in the answer 

to any number of members on the other side of the aisle that you 

aren’t aware, that doesn’t mean they don’t exist, it just means you 

are not aware, am I correct? Yes? All right, we will move on. 

The President’s fiscal year 2016 budget calls for 92 million for 

the Office of National Coordinator, ONC, for purposes including the 

transition to a governance approach for health information exchange. In 2012, an HHS request for information noted that Congressional authorities granted to the ONC in the 2009 High Tech 

Act would support this governance mechanism. Madam Secretary, 

I hold in my hand a copy of a Congressional Research Report dated 

January 7, 2015 that suggests ONC does not have the authority to 

support the ONC governance structure outlined in the President’s 

budget. Don’t you agree that when agencies take action they should 

be supported by congressional authorization? 

Secretary BURWELL. Not familiar with the report, would welcome 

seeing it. With regard to the Office of the National Coordinator, I 

think you know we just came out with the plan to continue moving 

us towards electronic medical records. We back that up with specific things. We continue to work on something that cuts across 

many of the issues, and whether it is—— 

Mr. GRIFFITH. But you would agree with the principle, that there 

ought to be congressional authority for an agency to take action, 

would you not? Yes or no? 

Secretary BURWELL. I would agree that we—— 

Mr. GRIFFITH. Yes, ma’am. 

Secretary BURWELL [continuing]. Need—— 

Mr. GRIFFITH. And, Mr. Chairman, if I could also have that Congressional Research Service report placed into the record, I 

would—— 

Mr. PITTS. Without objection, so ordered. 

64 

Mr. GRIFFITH. As a part of its governance push, ONC awarded 

a contract to RTI to develop its Health IT Safety Center. RTI said 

at the time of the award that it would define the focus, functions, 

governance, and value of the national health IT safety content. I 

am just concerned, as I pointed out a minute ago, that when you 

have these comments being made—now, we haven’t seen it yet, and 

the report that I just had entered into the record shows we haven’t 

seen the final analysis of what they are going to do, but when you 

have comments that they are planning to work on governance, and 

they don’t have that authority, I am concerned, when the experts 

are telling me, both legal and otherwise, that this agency is going 

beyond its scope of authority, that this is a problem in this Administration, and that we should be careful that we have any agency 

moving forward without congressional authority. 

I am going to ask you to work with me as we move forward on 

this. I am going to follow up with some questions and some other 

things, and ask that you work with me to make sure that the ONC 

does not overstep its authority granted to it in legislation by this 

Congress. 

Secretary BURWELL. I would like to work with you to understand, 

and understand what these concerns on governance are. This is 

new to me, and so I would like to—— 

Mr. KENNEDY. Yes, ma’am. 

Secretary BURWELL [continuing]. Understand further what the 

concern is. 

Mr. GRIFFITH. And I appreciate that, and I yield back. Thank 

you, Mr. Chairman. 

Secretary BURWELL. Yes. 

Mr. PITTS. Chair thanks the gentleman. Now recognize the 

gentlelady from California, Ms. Capps, 5 minutes for questions. 

Mrs. CAPPS. I thank my Chair—colleague for yielding me time, 

and I do have a different topic to discuss with you, Secretary 

Burwell, but my colleague from Texas has asked for 10 seconds. 

Mr. GREEN. I will do my 10 seconds. I want to thank the Congressman from Virginia, but I think the clarification is that up 

until Congressman Kennedy, all our statements were repeal the Affordable Care Act without an alternative. Now, there were bills 

that were passed, and none of us—up until—— 

Secretary BURWELL. That is right. 

Mr. GREEN [continuing]. Congressman Kennedy, but there is no 

repeal and replace. There is only repeal for 56 times. And thank 

you for—— 

Secretary BURWELL. And that is why I responded to full repeal. 

It was—— 

Mrs. CAPPS. I want—thank you. You know, I want to go back to 

the President’s budget this year, which I think, on the whole, 

strikes an important balance between controlling spending and promoting public health. These public health topics are what I want 

to bring to your attention. 

I was pleased to see that there was continued support for nursing workforce development. I believe, and I know you did too, a 

strong nursing workforce improves the health of our communities, 

as well as the quality of the health care system. And we now have 

the significant challenge in our Nation of caring for a growing paVerDate Nov 24 2008 12:31 Jul 13, 2016 Jkt 037690 PO 00000 Frm 00070 Fmt 6633 Sfmt 6633 F:\MY DOCS\HEARINGS 114\114-13 CHRIS
65 

tient population with limited resources. And I am a nurse, so I 

know that we can’t reach our health care goals without a strong 

health care workforce made up of a range of health care professionals. And these are the development programs, such as Title 8, 

that are proven to be a solution that can help address this challenge. 

And so would you please discuss briefly, because I have two more 

topics, what this budget request does to make sure that we have 

a diverse health care workforce, well equipped, and large enough 

to meet our needs? 

Secretary BURWELL. I will just be very brief—— 

Mrs. CAPPS. Sure. 

Secretary BURWELL [continuing]. Which is, I think one of the core 

and anchor places that we do that is making sure that we are funding our National Health Service Corps. And the increases that we 

have asked for are a very important part of that across, and it is 

especially important because we serve that group of people—30 

percent are diverse in that—— 

Mrs. CAPPS. Yes. 

Secretary BURWELL [continuing]. Group. And in the Nation as a 

whole, the number is 10 percent, so we are over-indexing for that, 

and we think that is a very important place. 

Mrs. CAPPS. Right. 

Secretary BURWELL. I will stop. There are other things, but I 

want to—— 

Mrs. CAPPS. Right, because this one that I am going to mention 

is near and dear to my heart, and that is the maternal, infant, and 

early childhood home visiting programs. Such bang for the buck 

that you get with this. If you have ever seen it as I have, been part 

of one, it is such a proactive and preventive service. And there is 

an increase in commitment in this home visiting program in the 

budget for 2016. These are evidence-based, as you know, bipartisan 

programs, helping to ensure that all children across the board get 

an opportunity to be healthy and successful. And they are so critical to improving health outcomes for both women and children and 

families. 

So my question is how increased funding for these programs is 

going to address disparities and improve the health? How can we 

make it better? 

Secretary BURWELL. So with regard to this issue, because I am 

a mother of a 5- and a 7-year-old, I have—— 

Mrs. CAPPS. There you go. 

Secretary BURWELL [continuing]. Learned the importance of that 

information very recently, in terms of being able to give your children what they need. And so the program that you are describing, 

and why we think it is important to continue on the pace, it is an 

evidence-based program. We have seen—— 

Mrs. CAPPS. Yes. 

Secretary BURWELL [continuing]. The results in terms of reading, 

and other analytical skills, up to 12 years old, in terms of the benefits. That is as far as it has been tested. And we see that has happened. When we give mothers and parents that opportunity to get 

the information they need in home—— 

Mrs. CAPPS. Yes. 

66 

Secretary BURWELL [continuing]. When you go to them, it is 

making the difference. And so we believe this is a very important 

part, and part of a continuum that you see in the budget. That 

home visiting, next comes to that early child care, and making sure 

that we fund child care so working Americans can be a part of that. 

And then the issues of Head Start, and improving Head Start, both 

in terms of the length of day, the time of year, and the quality that 

we require. So it is a continuum in terms—— 

Mrs. CAPPS. Yes. 

Secretary BURWELL [continuing]. Of making sure we are taking 

care of those children along the way for working families, and 

pressing ourselves to improve quality. 

Mrs. CAPPS. Right. And, to build on that, and the focus on children and family, this question was asked about graduate medical 

education, but I want to focus on children’s hospital GME, because 

children’s hospitals programs are so critical for training pediatricians, pediatric specialists, and pediatric researchers. It is less than 

one percent of hospitals. They train 51 percent of all pediatric specialists, and the children’s hospital graduate medical education programs currently receive much less funding than other, you know, 

children don’t lobby. We have to do this on their behalf. And would 

you explain the proposed changes to funding for children’s hospital 

graduate medical education programs, and what steps are being 

taken to ensure that we are meeting the demand for pediatric care? 

Secretary BURWELL. We want to meet that demand, and we want 

to meet that demand for both primary care, and the specialties 

where we don’t necessarily have the number of practicing physicians that we need. And so the proposal that we have tries to respond to the criticisms that we received last year with our proposal, and that there is $100 million that is dedicated firmly to the 

children’s programs. In addition to that, they are able to compete. 

Right now what we do is we cover the direct costs, but we don’t 

continue to cover the indirect cost. 

Mrs. CAPPS. Thank you very much. 

Mr. PITTS. Chair thanks the gentlelady. Now recognize the gentleman from Texas, Dr. Burgess, 5 minutes for questions. 

Mr. BURGESS. Thank you, Mr. Chairman. Again, Madam Secretary, my apologies for being out of the hearing, at another hearing. And I also apologize for not having the President’s budget here 

with me this morning. But the President did outline a number of 

savings in the Medicare space in the Presidential budget, is that 

correct? Do I understand—— 

Secretary BURWELL. Yes. 

Mr. BURGESS [continuing]. That correctly? 

Secretary BURWELL. That is correct. 

Mr. BURGESS. And in general, as the head of HHS, are you supportive of those proposals in the President’s budget? 

Secretary BURWELL. Yes. 

Mr. BURGESS. Let me ask you a question, then. You know that 

one of the things—I mean, I have just been pounding my head 

against the wall for 12 years on the sustainable growth rate formula. We were very close last year. We almost cracked the nut, but 

we didn’t quite get there. But I thought we had a good proposal, 

and we are very close to introducing the same policy language 

67 

again in this Congress. Offsets have been difficult, as everyone 

would expect. 

So let me just ask you, those savings that the President identified, those Medicare savings that the President identified in the 

Presidential budget, do you think it would be a good idea to apply 

those savings toward the permanent repeal of the sustainable 

growth rate formula? 

Secretary BURWELL. With regard to how we pay for it in the 

President’s budget, it is within the baseline, and we include it that 

way. With regard to the specific question of just using our approach 

to the Medicare, those savings are part of a broader context. It is 

a budget, and we put the budget together in its entirety. We view 

that those savings need to be paired with other elements of the 

budget. 

Mr. BURGESS. But to the extent that those savers are identified, 

and those offsets are identified in the budget, it seems to me that 

would perhaps be a reasonable place to begin the discussion of 

what are the offsets that are used to put in place for the permanent, universal, complete, forever repeal of the sustainable growth 

rate formula. 

Secretary BURWELL. First, I want to agree with the concept that 

we are talking about. In my opening remarks, I specifically said 

that we support the bipartisan, bicameral concepts that were put 

forward, and so on that we agree. With regard to the question of 

offsets, why I started with how we do it, which is building it into 

the baseline, is because that is the way we believe it should be 

done, and that uses the balance of things that we use to pay for 

things in our entire budget. 

So, in terms of where we start, and what we believe, we believe 

that it needs to be a range of things, and not simply focused on 

those. 

Mr. BURGESS. Yes, but at the same time, as you know, the difficulty with the sustainable growth rate formula is the budget 

baseline, and the fact that it was built in years ago, and it accumulates over time. It is never corrected, even though a number of 

patches have been passed by Congress. We basically paid for this 

damn thing at least 1.4 times—— 

Secretary BURWELL. I am—— 

Mr. BURGESS [continuing]. Over the past 12 years. Again—— 

Secretary BURWELL. Yes. 

Mr. BURGESS [continuing]. I just want you to know that. I like 

the fact that the President put forward cost savers in his budget. 

Fair warning to you that these are where I am going to go. The 

lack of participation and people who are willing to come forward 

and talk seriously about offsets leads me to go the President’s 

budget as the only place I can go for Democratic ideas for an offset. 

And that is the critical missing piece in getting this SGR settled. 

Secretary BURWELL. I think your colleague, Mr. Pallone, actually 

mentioned his specific idea for this when he spoke to this issue. 

And you may disagree with that, but that was in terms of contributing to the debate. 

Mr. BURGESS. And my door is always open to Mr. Pallone, and 

I await his invitation, and I will be glad to come to his office. 

68 

Let me ask you a question. I know you probably are tired of 

hearing about King vs. Burwell, but I will bring it up yet one more 

time, since I haven’t been here, it is not exhausting to me yet. On 

the whole concept around contingency plans, the American Academy of Actuaries, is concerned because insurance companies are 

supposed to disclose the data upon which they are basing their 

rates in May, but there could be something that changes the equation in June. So, to the extent that the insurance companies are 

having to deal with an unsettled future, I mean, they are going to 

have to deal with contingency plans, are they not? Why should the 

Department not have a contingency plan, as recommended by the 

American Academy of Actuaries? 

Secretary BURWELL. So, with regard to things that I have authority to plan for, I will plan for. In the current budget that you see 

in front of you, the unaccompanied children issue, one that I know 

is a difficult issue, and that there is controversy around, we have 

put in monies to plan up to 60, have asked for a contingency fund 

in case. We don’t believe it will, but in case the numbers—where 

there are places that I can plan, we will. 

With regard to this issue, while the letter was simple, it actually 

gets to the core and the fundamental. We do not believe we have 

administrative authorities—if the Court makes a decision, and as 

I want to always repeat, we don’t believe the Court will decide this 

way, but if the Court makes a decision and rules for Plaintiff, and 

says that those subsidies are not available, we don’t believe we 

have an authority to undo the damage that would then occur, 

which is subsidies go away, individuals can no longer pay. They go 

off of their insurance, they become uninsured, it drives premiums 

up in that marketplace. They become uninsured, there is indigent 

care, it goes up. 

We don’t believe that we have an authority. It is the Court, 

makes that decision at that level, that we have an authority to do 

it, and therefore that is why you are not hearing a plan. It is because we don’t have an authority. 

Mr. BURGESS. Well, I think you have to agree it will change the 

structure of the risk pools for the insurance companies. And, Mr. 

Chair, for that reason, I would like to submit the letter from the 

American Academy of Actuaries for the record. And I will yield 

back. 

Mr. PITTS. Without objection—— 

Secretary BURWELL. I do think, though—— 

Mr. PITTS [continuing]. So ordered. 

Secretary BURWELL [continuing]. That is why one does see those 

companies filing their briefs that they had filed in the case, that 

articulate the point you are making. 

[The information appears at the conclusion of the hearing.] 

Mr. PITTS. Gentleman yields back. Chair recognizes the Maryland, Mr. Sarbanes, 5 minutes for questions. 

Mr. SARBANES. Thank you, Mr. Chairman. Thank you, Madam 

Secretary. First, thank you for stepping into public service as you 

have done. Your tenure at OMB, and now at HHS, is, I think, a 

real service to the country. 

I wanted to talk about this concept of full repeal, which has been 

a drumbeat for years, it seems, now from the other side of the 

69 

aisle, to understand the implications of a full repeal. And so I 

wanted to go through some of the things that were part of the 

ACA, and ask you—and it may not be that every one of them is 

jeopardized by a full repeal, but I think certainly some of them are, 

the ACA included a measure that would allow young people to stay 

on their parents’ health care up to age 26, and I think upwards of 

three million younger adults have benefitted from that. If there 

was a full repeal of the ACA, would that benefit and provision be 

in jeopardy, do you know? 

Secretary BURWELL. It was part of the original Act, so yes. 

Mr. SARBANES. Then there was an effort to begin closing the 

donut hole on prescription drugs under the Part D program, which 

has bedeviled many of our seniors, who kind of fall into that doughnut hole, often at a critical stage, in terms of needing to access prescription drugs. And the ACA reform included an effort that is 

begin, it is underway, to close that doughnut hole. Would that be 

in jeopardy if there was a full repeal? 

Secretary BURWELL. It would, and the $15 billion in savings that 

those seniors have received to date would stop. 

Mr. SARBANES. Right. Then there was terrific provisions, in 

terms of benefits and reimbursement. So, on the benefits side, for 

Medicare beneficiaries, you had more preventive care being covered 

fully, eliminating co-payments for certain kinds of preventive care, 

screening for annual wellness visits, et cetera. That was part of the 

ACA. A full repeal, I imagine, would jeopardize that reform as 

well? 

Secretary BURWELL. Yes, and we actually just were able to have 

the numbers, and we have seen an increase in the number of seniors that are using that preventative are. And the percentage of 

seniors that are using at least one preventative service continues 

to go up. 

Mr. SARBANES. Excellent. We put in some enhanced payment and 

reimbursement for primary care physicians, recognizing that we 

need to make sure we are incentivizing that part of the profession, 

in terms of getting into the pipeline, and also having the opportunity to spend more time with their patients, and have there be 

some economic rewards for that, which the patients themselves 

also want. I presume that that would be a peril with a full repeal 

as well? 

Secretary BURWELL. A full repeal would imperil. 

Mr. SARBANES. What about the provisions that have eliminated 

discrimination based on pre-existing conditions? Of course, we have 

started right out of the gate eliminating that discrimination in the 

case of children, now that is been expanded more broadly. But I 

imagine that also would be undermined by a full—— 

Secretary BURWELL. It—— 

Mr. SARBANES [continuing]. Repeal? 

Secretary BURWELL. It would, and, having had the chance to 

meet a young woman who had cancer when she was 7—when she 

was 12 years old she first had colon cancer, and then had thyroid 

cancer later, and now is in her 20s, and was engaged, but not continuing her graduate education or getting married because her 

focus was paying for her health care. And now the opportunity to 

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viously, is now allowing her to go on with her life. The issues of 

health security are very important, but for many individuals, the 

financial security is as well. 

Mr. SARBANES. Thank you for those comments. The medical loss 

ratio requirement that now requires insurance plans to direct more 

of the insurance premium dollar to care, as opposed to overhead 

costs and so forth, that was part of the ACA, adhering to a particular standard. That would be eliminated, I would expect, in a 

full repeal? 

Secretary BURWELL. In full repeal. 

Mr. SARBANES. Subsidies and tax credits for small businesses 

who want to do the right thing and provide health care coverage 

for their employees was part of the ACA, so small businesses would 

be impacted by a full repeal, in terms of their ability to offer that 

kind of benefit to their workers, isn’t that correct? 

Secretary BURWELL. It would take away the tax credit if it were 

a full repeal. 

Mr. SARBANES. So even before we get to a discussion of the pros 

and cons of the health exchanges, which have now offered up coverage to millions of Americans, there are so many other reasons, 

in addition to that, that we wouldn’t want to repeal the Affordable 

Care Act. Thank you very much for being here. I appreciate your 

testimony. 

Secretary BURWELL. Thank you. 

Mr. PITTS. The Chair thanks the gentlemen. Now recognize the 

gentleman from Florida, Mr. Bilirakis, for questions. 

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

you, Madam Secretary for your testimony. Thanks for your appearance, welcome. I want to talk about Medicare Advantage. According 

to 2012 data, there were about 145,000 seniors in my district. 

About 40 percent of them are on Medicare Advantage, a little higher than the national average. They love their plans, and they want 

to keep their plans. They love their benefits, and their choices. Unfortunately, this Administration may not love Medicare Advantage 

as much as my seniors. 

The actuarial firm of Oliver Wyman did an analysis of the proposed 2016 Medicare Advantage rate notice. Reading the report, I 

am troubled to learn that it estimates that the combined impact of 

cuts from 2014 to 2016 will cost seniors on an average of $60 to 

$160 a month, or as much as $1,920 a year. Many of the seniors 

in my district live on a modest income—fixed income. Why is the 

Administration forcing many seniors to pay more than $100 a 

month to keep the plan they like? 

Secretary BURWELL. So, with regard to the issue of Medicare Advantage, first I want to say we think the program is a good program. During the period when changes have been enacted, we have 

seen the program expand by, I think, well over 40 percent. We 

have seen a number of Medicare Advantage plans that have the top 

two ratings go from 17 percent to 67 percent. And we have seen 

that premiums have not been increasing, in terms of the changes 

that we have done to date. 

Why we are proposing these changes is they have been recommended by MedPAC and others with regard to over-coding that 

is occurring, and as part of our efforts to make sure we are using 

71 

the taxpayer dollar wisely. We want to promote the program, we 

want to keep the program healthy, but we also believe that there 

are opportunities for those who may be not using the system as 

well as they might. And that is what our changes are about, and 

that is what we are trying to do, preserve and build the system, 

but make sure we do it in the fiscally responsible way. 

Mr. BILIRAKIS. Thank you, Madam Secretary. Many seniors who 

like the Medicare Advantage program they have are going to lose 

it in the following years. In fact, a recent—Milliman report details 

a nearly four-fold increase in the number of U.S. counties that no 

longer have Medicare Advantage as an option, growing from 55 

counties in 2012 to 211 counties in 2015. Isn’t it concerning to you 

that seniors are losing the ability to choose a Medicare plan that 

provides high quality and coordinated care? This is a very successful program, and, again, this is extremely important to my constituents. 

Secretary BURWELL. Agreed that it is a very important program, 

and we want to make sure that it continues, want to see the studies and the underpinning of that. The most recent numbers that I 

have seen are that 99 percent of beneficiaries have access, and so 

those numbers may not align with that most recent study, and I 

want to understand what the difference in that is. 

Mr. BILIRAKIS. Thank you, Madam Secretary. One more question. 

The impact of seniors to Medicare Advantage, according to Oliver 

Wyman, could result in seniors losing access to their current coverage, or facing higher premiums, reduced benefits, and changes to 

their network as a result of the proposed cuts. When I talked with 

seniors in my district about Medicare Advantage, again, they believe the Medicare Advantage model offers high quality coordinated 

care. Yet further cuts will disrupt the benefits upon which millions 

of seniors rely. 

Your agency likes to tout the so-called affordable premiums and 

better consumer choices under the Affordable Care Act, but when 

it comes to Medicare Advantage, why is the Administration pursuing policies that would increase premiums and reduce choices for 

seniors? And, again, this is very concerning. 

Secretary BURWELL. I think the responses with regard to the 

issue that we have seen, with the changes we have done to date, 

have not had the premium pressure that is described. We want to 

continue to watch and monitor. And also that we have seen more 

people enter in, and the quality improved. And so that is what we 

have seen to date. We want to continue to work and monitor. We 

want the program to succeed. We want to support it, and we want 

to try and do it in the way that is the most fiscally responsible. 

Mr. BILIRAKIS. Well, thank you, Madam Secretary. I appreciate 

it. I yield back, Mr. Chairman. 

Mr. PITTS. Chair thanks the gentleman. Now recognize the gentleman from California, Mr. Cardenas, 5 minutes for questions. 

Mr. CARDENAS. Thank you very much, Mr. Chairman. Appreciate 

the opportunity to have this public dialogue for the benefit not only 

of the members, but for the public as well. 

Preserving access to prescription drugs that work for every senior is important, I think, to everybody on this dais, and I think 

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ably makes everybody. So my question has to do with what proposals in the President’s budget would increase access for seniors? 

Secretary BURWELL. With regard to the specific access for seniors, across the board on prescription drugs, I think, in terms of the 

programs, whether that is the way we use some of the programs 

we have just been discussing, but I also think one of the most important things that has happened is that seniors have access to 

preventative services that they historically may not have. And just 

announced on Tuesday that what we are seeing is, because the seniors have that access to those preventative services, they are increasing the use of that. 

I think throughout our budget one the things we are attempting 

to do is work very hard to do a delivery system reform, which 

means getting better quality at a better price for the Nation. And 

I recently announced, about 3 weeks ago, that in the Medicare 

space, we are going to try and move to 30 percent of all Medicare 

payments will be in new payment models, payment models that are 

about improving that quality and reducing that cost. And so those 

are some of the areas that I think the budget focuses on this. 

Mr. CARDENAS. Now, that effort, is it likely to create an environment, individual by individual, that is likely to increase their quality of extended life versus—because when we are talking about access to preventative care, that means that if you catch something 

in its early stages—we all know what today’s modern medicine, 

and opportunities—you can actually thwart it, or actually overcome 

it, versus finding something late in stages, it might even take your 

life, correct? 

Secretary BURWELL. And across the department there are a number of investments that get to that, and whether that is the NIH 

investments in research, or in the Center for Innovation in Medicare and Medicaid, one of the things where we have out—a proposal that we are getting response to has to do with hospice and 

curative care, and how to combine those two in a way that will 

maximize for the quality of the patient. And so it is throughout the 

budget these issues of cost and quality are things that we focus on. 

Mr. CARDENAS. Thank you. On that note, I would also like to add 

for the record, if you would allow me unanimous consent, Mr. 

Chairman, to submit a letter for the record from my office that lays 

out the issues that we are discussing at the moment. 

Mr. PITTS. Without objection, so ordered. 

[The information appears at the conclusion of the hearing.] 

Secretary BURWELL. Thank you. 

Mr. CARDENAS. I keep hearing a lot from some of my colleagues 

about their constituents losing choices. But, then again, one of the 

things that—it is my understanding, please clarify, that when people are talking about losing choices, they may be describing policies 

that were, in fact more expensive on the front, and perhaps didn’t 

have minimum benefits standards to the person paying. Is that, in 

many cases, what people are describing when people are losing 

choices? 

Secretary BURWELL. It can be. I would want to understand the 

specific—— 

Mr. CARDENAS. And that is why I say the word maybe—— 

Secretary BURWELL [continuing]. In the marketplace. 

73 

Mr. CARDENAS. Maybe, yes. 

Secretary BURWELL. Within the marketplace, there are 25 percent more issuers, which means more choice. The essential health 

benefits do important things, I think, as you are reflecting, and 

they get to some of the issues that Mr. Murphy and Ms. Matsui— 

on mental health. And having those benefits be clear and incorporated is extremely important. So, without understand the specific 

case, I think it is a little hard to know. 

Mr. CARDENAS. But there are, in fact, in some areas where certain kinds of policies are not allowed, but that was—that is based 

on a new minimum standard, correct? 

Secretary BURWELL. That is correct. 

Mr. CARDENAS. And one of the things that I have discussed with 

some of my constituents, and my staff, and some of the providers, 

and experts that we pulled together, we registered at least over 

1,000 families. And I personally tried to speak to as many of those 

individuals as possible. And what was sad is many of them were 

even scared to be there. They were thinking about this big 

Obamacare dragon that was going to obliterate either their finances or their health care. 

But what—almost to a person, every person that got up from— 

once they sat down and figured out what was available to them, 

or what have you, had a big smile on their face, and they were very 

pleased, and very relieved, and glad they came. And in one instance I was talking to a gentleman who was paying $60 a month. 

He was making $9 an hour, single income family. He had a wife 

and a daughter, and I met all three of them. And when he was 

done, he had a big smile on his face. He almost got up and left 

when he met me. But when he was done, he actually realized that 

he now was able to provide for his family without having to spend 

$60 a month, and now his entire family has coverage. So I think 

that is a perfect example of what this is—what is good in the Affordable Care Act. 

Thank you, Mr. Chairman. I yield back my time. 

Mr. PITTS. Chair thanks the gentleman. Now recognize the gentleman from Indiana, Dr. Buschon, 5 minutes for questions. 

Mr. BUSCHON. Thank you, Secretary Burwell, and thanks for 

coming. And, first of all, I want to thank you for working with Governor Mike Pence of Indiana on Health Indiana Plan 2.0, which 

will help to cover 350,000 low income Hoosiers in a state-based program that, I think, has been shown historically to not only save 

money, but is very popular with the enrollees, so thank you very 

much for that work. 

Before I came to Congress, I was a cardiothoracic surgeon, and 

I treated most of my patients for many weeks after their surgery. 

And, as you probably know, that falls under a global payment, a 

90-day global surgical payment by CMS. Now CMS wants to repeal 

that rule, and eliminate global payments for surgical services. 

Why? 

Secretary BURWELL. With regard to our understanding of how 

the global payments are used, the reason that we want to do this 

is to make sure that, while we are promoting quality care, that we 

do it in a way that is most cost-effective for the taxpayer. Most of 

74 

the changes that we do in the Medicare space are focused on those 

two things, and trying to balance those two. 

Mr. BUSCHON. OK. And has HHS or CMS looked into the administrative costs the new systems will have on doctors and CMS? The 

reason I ask is, in my practice—I will give you some examples of 

how this actually will work—— 

Secretary BURWELL. Yes. 

Mr. BUSCHON [continuing]. Or won’t work if you do it. We would 

bill a global payment, for everything, including follow-up visits. 

Secretary BURWELL. Yes. 

Mr. BUSCHON. And now doctors will be billing for the surgery, 

every hospital round that they make, every follow-up appointment, 

all separately, let me finish. And not only would the medical practice have to pay employees to submit what I consider excessive 

claims, but then CMS will have to process each claim. And how can 

that not cost CMS more money, not less? That is my first question. 

Secretary BURWELL. With regard to the global payment issue, 

and one of the things—Dr. Patrick Conway—we try and have physicians who are practicing at the table as we have these conversations. Want to understand the point that you are making and how 

we believe—I want to look into this one, in terms of a specific answer to your—— 

Mr. BUSCHON. It will be a dramatic increase. Let me tell you 

why. If I did an open heart surgery on a patient, I would see them 

in the ICU anywhere from 3 to 5 days every day, and then probably two to three follow-up appointments. That is all under a global. 

Secretary BURWELL. Yes. 

Mr. BUSCHON. And so now that—those numbers will be submitted as individual bills. From a surgeon’s perspective, I see this 

as—and I think seniors should be paying attention to these comments. This is going to be a dramatic pay cut for surgeons across 

this country, and that is—in my view, that is where any potential 

savings will be coming from. So as you look at this, you should 

really—I would encourage you to pay attention to that, because 

what will happen is there is going to have to be re-evaluation of 

every code, re-evaluation of every follow-up appointment. You are 

going to have to discern whether there is duplicate billing. For example, if I see a patient post-op in the ICU, and a critical care physician is also seeing my patient that day, who gets paid, who 

doesn’t get paid? There will be increased denials. My point is this. 

Global payments were put in place to save money—— 

Secretary BURWELL. Yes. 

Mr. BUSCHON [continuing]. Administratively, and also simplify, 

and I think improve, quality of health care. And I think going backwards away from that is regressing backwards. Yes, it will save 

money. This will save money by dramatically cutting provider reimbursement. And if that is the intent, that is unfortunate, because 

what will also result is access issues for seniors for health care 

services, and, I would argue, less quality health care. 

And so, most of these bundles are re-examined every few years 

by—and so the argument that overbilling is occurring, if that were 

to be true, then these bundles are looked at every couple years and 

re-evaluated, so, on that subject, I would encourage you to take a 

75 

really hard look at global payments. They save money, and they 

don’t cost money. The savings will be on the backs of seniors’ access to health care, and quality, in my opinion. 

The other thing is the President’s budget would seek to save 20.9 

billion in savings over the next 10 years by strengthening the IPAD 

Board, a board of unelected members selected by the President to 

cut—in my view, to cut Medicare payments to providers. I understand the President has not yet nominated anyone to sit on the 

IPAD Board, so it could not recommend Medicare cuts this year. 

So in what year under the President’s budget will IPAD begin to 

make recommendations on Medicare costs? 

Secretary BURWELL. In the current President’s budget, IPAD 

would not kick in until 2019. 

Mr. BUSCHON. 2019? 

Secretary BURWELL. That is right. 

Mr. BUSCHON. OK. Thank you. Thank you, Mr. Chairman. I yield 

back. 

Mr. PITTS. Chair thanks the gentleman. Now recognize the gentleman from New York, Mr. Collins, 5 minutes for questions. 

Mr. COLLINS. Thank you, Mr. Chairman, and thank you, Secretary, for being here today. I am from Western New York, which 

is a very rural community. We have one of the highest enrollments 

for Medicare Advantage. I know prior to the Affordable Care Act 

I would say that without a doubt one of the bright spots in the delivery of health care in the United States was Medicare Advantage. 

Dealt with the donut hole. It was a lot of comfort for the seniors 

to be able to go in, much like we do with HMOs—a great program. 

And yet, as was brought out earlier, and I want to get into this, 

it seems as though the President, and the Administration, and 

HHS views Medicare Advantage with some level of disdain, in that 

it is the piece that keeps getting cut. 

And as I look through some of the data, and I am kind of a datadriven guy, the interesting thing I found about Medicare Advantage, there are over seven million enrollees, represents almost 30 

percent of the Medicare population, which would indicate it works. 

Number two, when you look at who uses it, lower income beneficiaries have a higher enrollment in Medicare Advantage than do 

wealthier individuals, which means it is serving best some of the 

lower income populations. We have also seen that, when I look at 

the rural plans, again, in rural America, which I represent, a higher percentage of folks from rural America are using it. 

So I am just asking the question, as—and the interesting thing 

too, the—that information we got today was from AHIP. They said 

the current 0.9 percent, the 0.9 percent cut that is coming now in 

the subsidy to insurance companies for Medicare Advantage, is 

going to add another $20 a month to beneficiaries, either in higher 

premiums, or reduced benefits. So could you speak to just the opinion of older Americans on Medicare, that they are being used as 

the funding source for the expansion in Medicaid, and all of those 

increased costs on the back of our seniors, who have depended on 

this great program for all these years? A frustration level exists 

within that population. 

Secretary BURWELL. Appreciate that, and as I responded to your 

colleague with regard to the issues of Medicare Advantage, I would 

76 

say we support the program, believe the program is a good program, but also believe that our responsibility, where we think there 

are things that are happening, whether that is up-coding or other 

things, that we try and take care of that. 

The changes that we have done, we have tried to transition those 

changes. We have tried to do those changes slowly so that we 

watch and monitor. We have seen an increase in the number of 

people in Medicare Advantage. We have seen premiums hold 

steady. We have seen an increase in quality. So the negative impacts that were articulated at the beginning of those proposals, we 

have not seen. We want to continue to monitor and make sure that 

we don’t see some of the negative impacts that you were talking 

about. We value the program. We think the changes—they have 

been recommended by MedPAC and others. 

We understand the concerns, but trying to operate in a world— 

and with regard to the other issue that you mentioned, I would just 

say across the board—and whether it is the issue that your colleague just mentioned, with regard to—or the $780 million we do 

in discretionary cuts, we try to spread these things across the entire parts of our budget. 

Mr. COLLINS. But are you aware that there now over 200 counties in the United States that don’t have a Medicare Advantage 

plan at all to offer their seniors as a direct result of the cuts you 

have made? So when you say it hasn’t had this impact, there are 

seniors in over 200 counties in the United States that can’t even 

buy the coverage. 

Secretary BURWELL. So 99 percent of the Nation has coverage, in 

terms of the beneficiaries’ accessibility. 

Mr. COLLINS. But yet the number who don’t has increased, from 

55 counties before the ACA to over 200 today. So there is a direct 

impact. I mean, the data is the data. You can’t make it go away. 

Secretary BURWELL. With regard to those numbers, as I said, I 

have the number of the current coverage, and would want to understand the change over the—— 

Mr. COLLINS. Yes. What I am trying to point out is it has had— 

the reason you are looking for this funding is to pay for the expansion of Medicaid. I mean, whether it is the health insurance tax, 

or the individual mandate, or whatever, the big cost driver has 

been this huge expansion in Medicaid, would be my observation. 

Secretary BURWELL. What I would observe is some of the comments that have been stated about the question of overall entitlements and the growth, we have a bulge of population. We have a 

large group of people who are elderly in Medicare. The Medicare 

costs, even though we have controlled per capita costs for Medicare 

over the period of what we are seeing, because more people from 

the baby boom are retiring and older, that is an issue that we, as 

a Nation, are going to have to look at and deal with. Medicare costs 

are going to continue to increase because of volume, even if we can 

control per capita cost. 

And so with regard to the questions of what will be costing the 

Nation money over periods of time, the issue of Medicare is one on 

a—because we are going to have the baby boom, and the echo come 

through, we are going to continue to have to make good on the 

77 

commitments we have made. And that will cost us, because even 

if you control it per capita, volume is greater. 

Mr. COLLINS. Well, thank you for the answer. My time has expired. Yield back. 

Mr. PITTS. Chair recognize the gentleman from New Mexico, Mr. 

Lujan, 5 minutes for questions. 

Mr. LUJAN. Thank you very much, Mr. Chairman, and I would 

yield to our Ranking Member, Mr. Green, for a quick response as 

well. 

Mr. GREEN. Thank you, Mr. Chairman. I want to respond to my 

colleague from New York. I have not had any of my seniors question the expansion of Medicaid, based on what is happening with 

Medicare. The Affordable Care Act was totally paid for, and, in 

fact, Medicare was improved under the Affordable Care Act. And, 

Madam Secretary, this is the first I have heard that seniors are 

complaining that the Medicaid expansion is being paid out of Medicare. That is just not, in fact, that I hear about. Did you have any 

information on that? 

Secretary BURWELL. That is the first that I have heard that anyone felt that that was an issue, with regard to the Federal budget, 

because I assume that is what they are referring to. 

Mr. COLLINS. If the gentleman would yield one minute—— 

Mr. LUJAN. Thank you. Reclaiming my time, thank you, Madam 

Secretary, for your testimony today. I want to reiterate what many 

of my colleagues have said, that we must repeal the SGR, but not 

on the backs of seniors, and that a strong CHIP extension must be 

included with the SGR in March as well. Also that the Affordable 

Care Act is working, despite an attempt of over 50 Republican repeal attempts. The ACA has had a positive impact on New Mexico, 

in my home state. In my home district, 25,000 people now have 

quality, affordable health coverage because of the Affordable Care 

Act that didn’t before, and overall the numbers of uninsured has 

declined by 17 percent. 

With the law now full in effect, Americans can never be discriminated against because of pre-existing conditions. Women can never 

be charged more for coverage because of their gender, and Americans will never be sold health insurance policies that disappear 

when they need coverage most, when they hit those lifetime caps, 

and suddenly coverage goes away. I think that it is time that we 

come together and work to strengthen the law, and stop playing political games that will strip millions of Americans of the health coverage they depend on. As my father would say, enough is enough. 

Madam Secretary, in your opinion, has the Affordable Care Act 

had a positive impact on places around the country, including my 

home state of New Mexico? 

Secretary BURWELL. Yes, and I think it has in three areas, affordability, access, and quality. With regard to the issues of quality, 

you touched upon a number of the areas where I believe there is 

been an improvement in quality, and those are the fact that people 

can have their children covered up to 26, the quality that you 

don’t—if you have a pre-existing condition, you can’t be kept out, 

or thrown off of your health care. If you take your child in for their 

wellness visit, there isn’t co-insurance. You don’t have to pay, in 

terms of that preventative care. So increases in quality. We have 

78 

also seen increases in quality through partnerships we are doing 

with physicians, and we have seen a 17 percent reduction in 

harms. Those are things like infections and falls in hospitals. That 

is also about saving lives, but it is also about money. 

With regard to the issue of affordability, and the progress that 

we have made on affordability, while we can all still continue to 

make more, we have in that space, and what we have seen is that, 

in the years 2011, ’12, and ’13, we have seen a record in terms of 

per capita health care cost growth. It is one of the lowest that we 

have seen on record, and we have seen that. That is in the broader 

marketplace. 

With regard to the individual market, what we have seen is that 

people—the vast majority, over 8 in 10 folks in the marketplace 

can find coverage using a subsidy that is $100 or less in a month. 

That is affordability in that marketplace. With regard to affordability and the taxpayer, CBO estimates pre the Affordable Care 

Act would have estimated that spending in Medicare would have 

been $116 billion greater. Affordability for the taxpayer. 

Lastly, access. The question of access, and the fact that 11.4 million people have come through the marketplace this time, but let 

us even use last year’s number, where we saw a 10 million person 

drop in the number of uninsured. So, against the three fundamental measures, that is how I would think about it. 

Mr. LUJAN. I appreciate that, Madam Secretary. Thank you for 

your response there, and I do want to raise an issue that has great 

concern to my constituents and to myself back in New Mexico. It 

has now been over 18 months since the State of New Mexico 

claimed credible allegations of fraud, or their allegations of fraud, 

against 15 behavioral health providers, resulting in the eventual 

closure or replacement by five Arizona behavioral health providers. 

This transition and turmoil has raised significant concerns across 

access to care, especially in light of recent reports that the new providers are financially unstable. In fact, one provider is already pulling out of New Mexico. 

The recently elected New Mexico Attorney General has also released the audit that led to the suspension, and it shows a lack of 

underlying basis for many of the allegations of fraud. My staff has 

had several meetings with CMS, and I am very concerned that we 

are not making progress. When payment suspensions are put into 

place, what CMS do to ensure states are acting in good faith, and 

what is CMS doing to stop the reoccurrence of this happening, both 

in New Mexico and other states, and can I have your commitment 

that we can work together on this particular issue and met with 

the delegation? 

Secretary BURWELL. Do want to work with you on this issue. 

Know it is one of concern, in terms of making sure that people have 

access to those benefits. 

Mr. LUJAN. I appreciate that. Thank you very much. I yield back 

the balance of my time. 

Mr. PITTS. Thank the gentleman. Now recognize the gentlelady 

from North Carolina, Ms. Ellmers, 5 minutes for—— 

Mrs. ELLMERS. Thank you. And thank you, Madam Secretary, for 

being with us today. I do have three different questions to ask you 

about, but I do want to address the issue of Medicare, and our senVerDate Nov 24 2008 12:31 Jul 13, 2016 Jkt 037690 PO 00000 Frm 00084 Fmt 6633 Sfmt 6633 F:\MY DOCS\HEARINGS 114\114-13 CHRIS
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iors who are concerned. It is my recollection, and I am just going 

back to history, that over $700 billion was taken out of Medicare 

in order to pay for Obamacare. About 300 billion of that was Medicare Advantage. So to the question of whether or not our seniors 

are concerned about that, I say yes, they are concerned about that, 

and they want to make sure that they will be able to continue to 

get the care they deserve. 

I want to start off by talking about Medicare reimbursement in 

relation to the two percent sequester cuts that were put in place 

a number of years ago, which dramatically affected our chemotherapy drugs and Part B drugs. As you know, this has affected 

our industry. Back on January 14 of 2013, Office of Management 

and Budget put out a letter asking Federal agencies to, ‘‘use any 

available flexibility to reduce operational risks, and minimize impacts of the agency’s core mission in service of the American people.’’ 

Some adverse things happened as a result. of the two percent cut 

over 16 months, after CMS started applying the two percent cut, 

We basically ended up with 25 community oncology clinics closing, 

one of which was a very large clinic in my own district. Seventy 

five others merged with hospitals. CMS’s own numbers show that 

it costs $6,500 more per year per patient on oncology services if 

they are part of the hospital system, versus the clinic setting, or 

outpatient setting, which is about $650 more out of pocket. 

Why hasn’t CMS taken the recommendation of OMB and addressed that situation? 

Secretary BURWELL. Congresswomen, we agree with you about 

sequester, and in this budget, we fully get rid of sequester, both on 

the mandatory side, and on the discretionary side. We believe there 

are other choices that are better choices, and so agree with you, 

this is not an approach—when you use an approach like this—— 

Mrs. ELLMERS. Yes. 

Secretary BURWELL [continuing]. You end up doing things like 

the types of things you are talking about. And so what we want 

to do is fully replace it, and that is what our budget does. We are 

willing to make other choices, in terms of how we get those savings. 

Mrs. ELLMERS. Thank you. And I will go on to a very important 

question, having to do, essentially, with our tobacco products. My 

question for you is, do you agree with Mitch Zeller, Director of FDA 

Center for Tobacco Products, that if the smokers, and I am quoting 

him, ‘‘who are otherwise unable or unwilling to quit were to completely switch to smokeless tobacco products, it would be good for 

the public health.’’ Do you agree with this statement? 

Secretary BURWELL. I would have to understand the context in 

which he made that statement. With regard to the question, I 

think, you know, we want to promote the public health. We want 

to—— 

Mrs. ELLMERS. Yes. 

Secretary BURWELL [continuing]. Make sure we are doing the 

right research to understand that, and put in place the right guidelines and regulations to do it. 

Mrs. ELLMERS. Well, thank you. I do want to add that there are 

no government Web sites that help promote or address this issue, 

80 

including CDC, FDA, NIH. It would be helpful for the public to understand that there are the non-tobacco products available, and 

this is an approach we need to make. I would welcome the ability 

to continue to work with you, and your office, on any way that we 

can better help to get the information out, and address the needs 

from a scientific basis, using the scientific research that is out 

there. 

I do want to switch gears to our vaccines and to BARDA. Right 

now BARDA maintains a stockpile of roughly $1.7 billion worth of 

pandemic influenza vaccine. This year’s budget, I believe, is about 

$20 million in order to take care of that stockpile and maintain it. 

Does the 2016 budget increase that amount, and how does BARDA 

plan on dealing with those issues, especially when our situation is 

very timely? 

Secretary BURWELL. Across the board our budget has worked to 

do a couple of things with regard to the preparedness, making sure 

that that vaccine stockpile, and that the issues that BARDA handles—— 

Mrs. ELLMERS. Yes. 

Secretary BURWELL [continuing]. Which are making sure that 

what we have on hand in stockpile, and that we have the ability 

to work with manufacturers to bring new products online, where 

that is appropriate—— 

Mrs. ELLMERS. Yes. 

Secretary BURWELL [continuing]. For different types of issues 

that we as a Nation may face, either man-made or otherwise. But 

we also have paired that with things in our budget which are about 

the preparedness in our communities—— 

Mrs. ELLMERS. Yes. 

Secretary BURWELL [continuing]. And we have seen that front 

and center, certainly, in our time period. We are implementing the 

dollars we appreciate from Congress as part of that, in terms of 

Ebola, but also broader preparedness—— 

Mrs. ELLMERS. Yes. 

Secretary BURWELL [continuing]. Where we have been given that 

authority by the Congress. 

Mrs. ELLMERS. Thank you, Secretary Burwell, for being here 

today. I truly appreciate your input. Thank you. 

Secretary BURWELL. Thank you. 

Mr. PITTS. Chair thanks the gentlelady. That concludes the questions of the members who are present. I am sure we will have lots 

of follow up and written questions from some of the members, so 

we will get those to you promptly. We ask that you please respond 

to the questions promptly. I remind members that they have 10 

business days to submit questions for the record, and that means 

they should submit their questions by the close of business on 

Thursday, March the 12th. 

Thank you very much, Madam Secretary, for your attendance 

today and your answers. Without objection, subcommittee is adjourned. 

[Whereupon, at 12:55 p.m., the subcommittee was adjourned.] 

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[Secretary Burwell did not respond to submitted questions by the 

time of printing.] 

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