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HEALTHIER FEDS AND FAMILIES: INTRODUCING

INFORMATION TECHNOLOGY INTO THE FEDERAL EMPLOYEES HEALTH BENEFITS PROGRAM

HEARING

BEFORE THE

SUBCOMMITTEE ON THE FEDERAL WORKFORCE

AND AGENCY ORGANIZATION

OF THE

COMMITTEE ON

GOVERNMENT REFORM

HOUSE OF REPRESENTATIVES

ONE HUNDRED NINTH CONGRESS

SECOND SESSION

ON

H.R. 4859

TO AMEND CHAPTER 89 OF TITLE 5, UNITED STATES CODE, TO PROVIDE FOR THE IMPLEMENTATION OF A SYSTEM OF ELECTRONIC

HEALTH RECORDS UNDER THE FEDERAL EMPLOYEES HEALTH BENEFITS PROGRAM

MARCH 15, 2006

Serial No. 109–130

Printed for the use of the Committee on Government Reform

(

Available via the World Wide Web: http://www.gpoaccess.gov/congress/index.html

http://www.house.gov/reform

(II)

COMMITTEE ON GOVERNMENT REFORM

TOM DAVIS, Virginia, Chairman

CHRISTOPHER SHAYS, Connecticut

DAN BURTON, Indiana

ILEANA ROS-LEHTINEN, Florida

JOHN M. MCHUGH, New York

JOHN L. MICA, Florida

GIL GUTKNECHT, Minnesota

MARK E. SOUDER, Indiana

STEVEN C. LATOURETTE, Ohio

TODD RUSSELL PLATTS, Pennsylvania

CHRIS CANNON, Utah

JOHN J. DUNCAN, JR., Tennessee

CANDICE S. MILLER, Michigan

MICHAEL R. TURNER, Ohio

DARRELL E. ISSA, California

JON C. PORTER, Nevada

KENNY MARCHANT, Texas

LYNN A. WESTMORELAND, Georgia

PATRICK T. MCHENRY, North Carolina

CHARLES W. DENT, Pennsylvania

VIRGINIA FOXX, North Carolina

JEAN SCHMIDT, Ohio

——— ———

HENRY A. WAXMAN, California

TOM LANTOS, California

MAJOR R. OWENS, New York

EDOLPHUS TOWNS, New York

PAUL E. KANJORSKI, Pennsylvania

CAROLYN B. MALONEY, New York

ELIJAH E. CUMMINGS, Maryland

DENNIS J. KUCINICH, Ohio

DANNY K. DAVIS, Illinois

WM. LACY CLAY, Missouri

DIANE E. WATSON, California

STEPHEN F. LYNCH, Massachusetts

CHRIS VAN HOLLEN, Maryland

LINDA T. SANCHEZ, California

C.A. DUTCH RUPPERSBERGER, Maryland

BRIAN HIGGINS, New York

ELEANOR HOLMES NORTON, District of

Columbia

———

BERNARD SANDERS, Vermont

(Independent)

DAVID MARIN, Staff Director

TERESA AUSTIN, Chief Clerk

PHIL BARNETT, Minority Chief of Staff/Chief Counsel

SUBCOMMITTEE ON THE FEDERAL WORKFORCE AND AGENCY ORGANIZATION

JON C. PORTER, Nevada, Chairman

JOHN L. MICA, Florida

TOM DAVIS, Virginia

DARRELL E. ISSA, California

KENNY MARCHANT, Texas

PATRICK T. MCHENRY, North Carolina

JEAN SCHMIDT, Ohio

DANNY K. DAVIS, Illinois

MAJOR R. OWENS, New York

ELEANOR HOLMES NORTON, District of

Columbia

ELIJAH E. CUMMINGS, Maryland

CHRIS VAN HOLLEN, Maryland

EX OFFICIO

HENRY A. WAXMAN, CALIFORNIA

RON MARTINSON, Staff Director

CHAD BUNGARD, Deputy Staff Director

CHAD CHRISTOFFERSON, Legislative Assistant

MARK STEPHENSON, Minority Professional Staff Member

(III)

C O N T E N T S

Page

Hearing held on March 15, 2006 ............................................................................ 1

Text of H.R. 4859 ..................................................................................................... 10

Statement of:

Gingrich, Hon. Newt, former Speaker of the House ...................................... 26

Powner, David A., Director, Information Technology Management Issues,

U.S. Government Accountability Office; Jane F. Barlow, M.D., MPH,

MBA, IBM Well-Being Director, Global Well-Being Services and Health

Benefits, the IBM Corp.; David St. Clair, founder and chief executive

officer, MEDECISION, Inc.; Paul B. Handel, M.D., vice president and

chief medical director, Blue CrossBlue Shield of Texas (a Division of

Health Care Service Corp.); Jeannine M. Rivet, executive vice president, UnitedHealth Group; and Malik M. Hasan, M.D., chief executive

officer, Healthview, retired chief executive officer, Health Net ................ 57

Barlow, Jane F., M.D. ............................................................................... 80

Handel, Paul B., M.D. ............................................................................... 114

Hasan, Malik M., M.D. ............................................................................. 132

Powner, David A. ....................................................................................... 57

Rivet, Jeannine M. .................................................................................... 119

St. Clair, David .......................................................................................... 93

Letters, statements, etc., submitted for the record by:

Barlow, Jane F., M.D., MPH, MBA, IBM well-being director, Global WellBeing Services and Health Benefits, the IBM Corp., prepared statement of ........................................................................................................... 82

Clay, Hon. Wm. Lacy, a Representative in Congress from the State of

Missouri, prepared statement of .................................................................. 154

Cummings, Hon. Elijah E., a Representative in Congress from the State

of Maryland, prepared statement of ............................................................ 156

Ewen, Dr. Edward, Jr., prepared statement of .............................................. 146

Gingrich, Hon. Newt, former Speaker of the House, prepared statement

of ..................................................................................................................... 30

Handel, Paul B., M.D., vice president and chief medical director, Blue

CrossBlue Shield of Texas (a Division of Health Care Service Corp.),

prepared statement of ................................................................................... 116

Hasan, Malik M., M.D., chief executive officer, Healthview, retired chief

executive officer, Health Net , prepared statement of ............................... 134

Porter, Hon. Jon C., a Representative in Congress from the State of

Nevada, prepared statement of .................................................................... 6

Powner, David A., Director, Information Technology Management Issues,

U.S. Government Accountability Office, prepared statement of ............... 60

Rivet, Jeannine M., executive vice president, UnitedHealth Group, prepared statement of ........................................................................................ 122

St. Clair, David, founder and chief executive officer, MEDECISION, Inc.,

prepared statement of ................................................................................... 96

(1)

HEALTHIER FEDS AND FAMILIES: INTRODUCING INFORMATION TECHNOLOGY INTO THE

FEDERAL EMPLOYEES HEALTH BENEFITS

PROGRAM

WEDNESDAY, MARCH 15, 2006

HOUSE OF REPRESENTATIVES,

SUBCOMMITTEE ON FEDERAL WORKFORCE AND AGENCY

ORGANIZATION,

COMMITTEE ON GOVERNMENT REFORM,

Washington, DC.

The subcommittee met, pursuant to notice, at 3:18 p.m., in room

2154, Rayburn House Office Building, Hon. Jon C. Porter (chairman of the subcommittee) presiding.

Present: Representatives Porter, Norton, Cummings, Van Hollen,

and Clay.

Staff present: Ronald Martinson, staff director; Chad Bungard,

deputy staff director/chief counsel; Chad Christofferson and Alex

Cooper, legislative assistants; Patrick Jennings, OPM detailee/senior counsel; Mark Stephenson, Tania Shand, and Adam Bordes, minority professional staff members; and Teresa Coufal, minority assistant clerk.

Mr. PORTER. Good afternoon. I would like to bring the meeting

to order, and I certainly appreciate all of you being here today. A

quorum being present, the Subcommittee on the Federal Workforce

and Agency Organization will come to order.

This will be the first of two hearings that focus on a bill that I

and Representative Lacy Clay from Missouri have introduced,

namely, H.R. 4859, the Federal Family Health Information Technology Act. In the past decade, information technology has exploded onto the scene and revolutionized the way we do business

in every industry. Companies from every sector of the marketplace

have made huge investments in technology development and are

reaping the benefits tenfold.

For example, last month, General Motors announced that it would be awarding a $15 billion contract for information technology

development. Analysts are saying that this is the single largest information technology contract ever awarded through a bidding

process. If information technology is so pervasive in every industry

from automotive to financial services, why has it seemingly bypassed one of the largest industries in the United States—health

care? The answers to that question are many, but the good news

is that the barriers blocking health information technology from

growing are rapidly crumbling. People are working harder than

2

ever to see that health information technology is not simply something that a few companies are using, but is a reality for all Americans.

As health information technology systems are developed, I believe that not only will the quality of health care delivery improve

dramatically, but so will the quality of health care overall. Some

have estimated that over 90 percent of the activity spent on delivering health care depends on the exchange of information. Information flows constantly from patients to doctors to carriers to pharmacies and others, yet we are still using the processes of yesterday.

With health information technology, we will not only decrease the

amount of time it takes to exchange this information, but we will

greatly increase the accuracy of the information that we exchange.

One of the sad realities in the industry today is that medical errors are a major problem. The Institute of Medicine estimates that

medical errors account for approximately 45,000 to 98,000 deaths

each year in the United States and over 770,000 injuries due to adverse drug events, many of which could have been prevented

through the use of information technology. If listed among deadly

diseases, medical errors would be considered among the leading

causes of death, even outpacing highway accidents, breast cancer,

and AIDS. This is no slight to our medical professionals, who are

the best in the world, but rather is an indictment of the antiquated

technology they rely on.

The use of technology will reduce medical errors by making

health information more accessible to both patients and providers

no matter where the patient is receiving the care. For example, the

Boston Globe recently reported a senseless preventable death of a

79-year-old retired chemist who died after doctors at Massachusetts

General Hospital treated him for a stroke when he really was having an insulin reaction. It is easy to see how an electronic medical

record could have assisted the physicians in correctly diagnosing

this patient. In a world where our cars, our pets, and our checking

accounts have their own computerized record, it is time for every

American to benefit from the same technology.

Back home in Nevada, I spend a lot of time with foster kids. Unfortunately, health records for these children are scarce, which

leads to needless multiple tetanus shots and other inoculations and

multiple exams, and putting these children at risk for encountering

a medical error because their prior medical histories are not always

known. With the technological advances that we have made, this

is unacceptable. And as you know, technology today is in dog years.

For every 1 year, it is 7. Technology is changing rapidly, becoming

more and more efficient and more and more accessible.

As chairman of this subcommittee, I have been working closely

with leaders from government and industry to develop legislation

to bring health information technology to the health plans the Federal Government offers to its own employees. We have a wonderful

opportunity to improve the quality and delivery of health care for

the over 8 million participants in the Federal Employees Health

Benefits Program and at the same time serve as a model to effect

change elsewhere. Passing this up would be a huge mistake—a

mistake we cannot afford since many lives would be unnecessarily

3

placed at risk, especially since the solution is literally at our fingertips.

The bill that I have introduced is based on very successful demonstration projects around the country, and we will hear from several individuals who were involved in those demonstrations this

afternoon. The bill does recognize that there are three basic components of a complete electronic health record: No. 1, the carrierbased electronic health record; No. 2, the personal electronic health

record; and, No. 3, the provider-based electronic health record. And

recognizing this, the bill will establish a carrier-based electronic

health record and personal electronic health record and provides

incentives for creating a provider-based electronic health record.

The first component of the bill will require all carriers participating in the Federal plan to create a carrier-based electronic health

record for each of the participants. This piece of electronic health

record will provide each participant and his or her providers with

the information maintained by the member’s carrier in a format

useful for diagnosis and treatment. This claim-based component of

the electronic health record can provide valuable information by

leveraging the data, technology, and capabilities of health plans to

improve health care decisions by patients and providers. This information is already there, and to ignore it would cause innocent people to unnecessarily suffer injury or death.

Hurricanes Katrina and Rita serve as stark examples of the

value of carrier-based electronic health records. When Hurricane

Katrina hit, many medical records were destroyed or were not immediately available for patients, potentially putting some patients

at great risk. Hoping to avoid the medical disasters associated with

Hurricane Katrina, Blue CrossBlue Shield of Texas extracted data

on its members who lived in the areas that were evacuated before

Hurricane Rita hit. To help physicians care for Hurricane Rita

evacuees, Blue Cross took its carrier based data for 830,000 members and converted it into an electronic health record available to

any treating provider and did it in 4 days—830,000 members were

converted into an electronic health record in 4 days. Those records

contain historic and current data such as lab results, pharmacy information, and basic medical history.

The second component of the bill requires a carrier to create a

personal electronic health record at the request of an individual

and would allow each individual to participate in his or her own

health care by enabling the individual to input information into the

electronic health record, such as personal health history, family

health history, symptoms, over-the-counter medication, living will

information, diet, exercise, or other relevant information and activities. As our guest today, Speaker Newt Gingrich, will mention, it

will provide for ownership for health care, for individuals to have

ownership over their own information and their health care.

The third major component of the bill provides for a creative

mechanism for individual providers to obtain funding for health information systems in their offices. Specifically, the funding would

be available to providers to implement an interoperable electronic

provider-based records system. The bill would establish a trust

fund at the Office of Personnel Management that would accept private contributions. OPM will then issue grants from the fund to

4

participating carriers to be distributed as performance incentives to

their contracting health care providers to implement the providerbased electronic health records. Now, to tie all these components

together, the bill will require that within 5 years of passage, each

participant will have his or her own electronic health record contained on a portable digital medium.

I would also like to quickly address three additional issues surrounding the bill. First is privacy. Privacy is always at the top of

the list of concerns, and for the many groups that I met with, it

was always the No. 1 issue that was brought forward, so rightfully

so, it needs to be taken care of. There is nothing more personal and

private than a person’s medical information. Under my bill, we will

ensure that participants’ medical information is kept private and

secure by requiring compliance with the Health Insurance Portability and Accounting Act. In addition, there are some great minds

at the Department of Health and Human Services thinking long

and hard about this important issue, particularly through the work

of the Health Information Security and Privacy Collaboration.

Second, I would also like to address interoperability. The administration has gathered the Nation’s leading experts in this area to

develop standards that everyone can work under. The bill that I

will be introducing will follow the standards being developed by the

Department of Health and Human Services. I am not interested in

creating a system of electronic health records that will be obsolete

or incompatible with other systems.

Third, and finally, we must deal with the issue of cost. Under the

bill, the Federal Employees Health Benefits Program rates should

not increase and insurance carriers will not be burdened with paying the administrative costs to implement the requirements in the

bill. The bill includes provisions to ensure that electronic health

records are implemented over a number of years and that participating insurance carriers can tap into existing funds dedicated for

administrative purposes being held by OPM during the implementation stages.

Additionally, there are significant savings that can be seen with

the implementation of health information technology in the Federal

Employees Health Benefits Program. In my own State of Nevada,

Health Plan of Nevada has done a tremendous job of implementing

the HIT system. Their transition from paper records to electronic

records has saved them nearly $1.7 million, resulting from a more

than 50 percent reduction in medical records, staff, and paperwork,

and certainly the errors. The think tank Rand Corp. estimated

that, in addition to the saving of lives, the U.S. health care system

could save as much as $162 billion annually with the widespread

use of health care information technology.

Making electronic health records available for patients is the

SMART thing to do, and SMART serves as a perfect acronym to

demonstrate the strengths of the health information system. ‘‘S’’ is

very simple; it stands for Significantly reducing medical errors. ‘‘M’’

stands for Making prescription errors extinct. ‘‘A’’ represents the

prevention of Adverse effects from conflicting course of treatment.

And the ‘‘R’’ stands for Reducing redundancy of testing and paperwork. And ‘‘T’’ stands for recognizing that it is Time to improve the

5

quality and the delivery of health care in the United States for

every American citizen.

The bottom line is simple: the technology is there to save lives

and improve the quality of health care. It would be a colossal error

to not take advantage of using technology to turn valuable claims

data, for instance, into electronic health records. There are many,

many successful HIT demonstration projects throughout the country that have shown us that this can be done. The Federal Employees Health Benefits Program cannot afford to wait any longer.

I look forward to the discussions today from our experts and from

all the witnesses.

[The prepared statement of Hon. Jon C. Porter and the text of

H.R. 4859 follows:]

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Mr. PORTER. I would now like to recognize Eleanor Holmes Norton. Would you like to——

Ms. NORTON. Thank you, Mr. Chairman. I am pleased to speak

for this side.

I want to thank you for this initiative. This is a very important

initiative because you are getting into some of the really important

issues if one is serious about this matter. I want to thank my good

friend and former Speaker of the House, Newt Gingrich, and welcome him back and recall our fond days of working together. The

former Speaker and I worked together closely on many projects affecting the District of Columbia and always on a win-win basis. We

did not agree on many subjects, so we got together and figured out

how to do it on a basis that we could agree. And in that spirit, I

think we should approach this matter because, Mr. Chairman, if I

may say so, the one thing I don’t think we have to do is to convince

people of the necessity of finally applying technology to the medical

sector. Indeed, the medical sector is well nigh primitive as compared with virtually every other major sector in American life, and

I really don’t think it is because the various components of that

sector are ignorant of the advantages of technology.

As I say, one has to live in the technology age perhaps a few

hours, only a few hours, considering how far we have come to understand what the advantages would be. And, therefore, as with

any intriguing issue like this, the way to approach it is only, frankly, with respect to the hard questions. The easy ones are settled as

far as I am concerned.

It is not what to do. It is how to do it that has received so little,

if you will forgive me, of the gray matter that it will take to finally

bring the medical sector into the same part of the 21st century that

the rest of America is in. And considering how much of our resources they eat up, we better figure out how to do that.

I certainly believe it is quite appropriate, Mr. Chairman, that the

Federal sector, even Federal employees, should always lead the

way. We ought to be the best sector when it comes to health care.

Would that we were, we ought to be the best sector when it comes

to showing the private sector how to do it so we are all on the same

page.

I may have a little disagreement with some who speak first and

foremost—as you do not, Mr. Chairman—about the importance of

technology in the medical field as saving money. So I think we

ought to put that aside. Sure, it will save money over years. But

as with everything, we ought to say to everybody there are up-front

costs of investment and you have to understand that if you want

the advantages. And some of the advantages you cannot do without. We should not play that down, and those up-front costs cannot

come from the cost of health care, which is already in such great

ascendancy that nobody can find it. And if I may say so, Mr. Chairman, I think it has something to do with the reluctance of the medical sector to bite off this issue at all. So you have wisely tried to

find a way to deal with that matter.

It is not, frankly, costs and I would never try to sell it to the

American people and certainly not to this Congress this way. Neither the American people nor the Congress of the United States believes in the notion that you invest and the more you invest and

23

the more wisely you invest, you get a yield. We are a country that

believes in instant yield. You invest a little and you get a whole

lot out. So you invest a little in education and everybody comes out,

you know, going to college and you are at the top of the list instead

of at the bottom. Not in the private sector. We understand that you

do not get a benefit for a long time. You do not look at how a company is doing by finding whether there is a profit yet, if it goes for

years and years without a profit, you understand that.

In selling this, we have to make clear people understand what

they do get out of it, that they are going to have to invest, and that

gradually this will pay off. What will pay off almost immediately,

if we do it right, it seems to me, is the terrible price we pay in mistakes in the health care system in an utterly mobile country, in not

even knowing or remembering who the health care providers were,

what the medications were, forgetting perhaps or having no paper

trail to vital information that affects your health, a world in which

pharmaceuticals are able to do more and more for you, but you got

to have a lot of information before they do what they are supposed

to do. No question in my mind we got to do that. The more advanced medical science gets, the more we need medical technology

to help us matriculate through all that is now available to us.

This issue raises profound problems. The way in which you propose to fund this matter, Mr. Chairman, would probably raise some

problems for lots of folks. The notion of the use of reserves in any

way would have to be looked at very carefully. I take no opinion

on it now, but I do note that even some of the private sector carriers have raised questions about that kind of use.

Questions of liability go, of course, to privacy, but well beyond

that, carriers themselves begin to raise the notion that even if you

get the kind of security that most people do not trust, frankly, the

technology system to give us, with firewalls and everything else

you can talk about, whether or not they want to be responsible for

having the medical records of everybody in there, you know, Members of Congress, people with security clearances, people whose

identity is not supposed to be known at all—I mean, it is the hard

questions that interest me, not whether or not, you know, my nextdoor neighbor and I can go in and I cannot get his and he cannot

get mine. It is the hard questions. And it is some of the questions

that technology has not even now begun to deal with in the ordinary course.

I am the last one to say they cannot deal with it. This may be

the way in which there is a real incentive to deal with these questions. But they have to be dealt with.

I will not say anything about privacy except this one thing, Mr.

Chairman. I think that the Federal work force is an appropriate

guinea pig to experiment on—that is to say, if, in fact, you have

willing guinea pigs. Now, if you are going to put people’s medical

records out there in the great cyberspace beyond, just let me say

right here don’t go to—as your counsel, as the one who went to law

school——

Mr. PORTER. Actually, you are my Congresswoman. Remember,

I live in your district here part-time. [Laughter.]

Ms. NORTON. As your Congresswoman for the period during

which you are in Washington, as your counsel, do not even consider

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everybody is in it and you have to opt out. You cannot start with

even a small pool of people are in it unless you opt out—not when

you are dealing with people’s medical records, not when you are

dealing with that one group of records that people most fear getting beyond whom they want to get—not when even if your doctor

gets it and it is online or your doctor or the hospital that you move

to, you don’t now if it is the clerk there, if it is somebody else, other

than the professional who gets it. You have to deal with the hard

questions, I say.

Let me leave you, Mr. Chairman, with this one phrase: ‘‘Medicare prescription drug program.’’ If you keep that in your head the

whole time and all of the glitches that came from throwing all

those people out—and, by the way, we told the poor people, you all

are in so you do not even have to worry about it, until all over the

country people said that we cannot find the names.

If we are going to do this—and I would very much countenance

our doing it—we should take a very small pool of the willing and

test it. They will be all around us. There will be the computer nuts

who want to be in this small group. There will be people who are

intrigued and want their records in the same place. They may live

in the same place. There are a whole bunch of them. We have 3

million folks who work for the Federal Government. It would be

lovely if they could all be in the same kind of unit. And part of the

art of this will be figuring out who should try it out, making sure

that they are willing, and again, as your counsel, I say make sure

they sign that they have been willing. And then let us go for it and

see what we can find out, just as I expect to find out much from

hearing from our witnesses today.

Thank you again, Mr. Chairman.

Mr. PORTER. Thank you, Congresswoman. I appreciate your comments.

Next I would like to introduce my cosponsor, Mr. Clay.

Mr. CLAY. Thank you. Thank you, Mr. Chairman, and especially

for calling today’s hearing on ways we can improve the use of information technology in our health care delivery system, and also

thank you for inviting me to sit on the panel today on the Federal

Workforce and Agency Organization Subcommittee. I appreciate

that.

I especially want to express my gratitude to you for our mutual

efforts in developing health IT legislation that can benefit our public health infrastructure for generations to come. And as you mentioned earlier, the Rand Corp. recently estimated that the implementation of a nationwide health care information network that is

utilized by 90 percent of providers will produce an annual savings

of approximately $162 billion while reducing the number of adverse

patient drug reactions in hospitals by more than 2 million per year.

The only way to achieve these outcomes, however, is through the

leadership of the Federal Government, and I am a proud cosponsor

of Chairman Porter’s Federal Family Health Information Technology Act of 2006. This bill utilizes the market power of the Federal Government by establishing a process for the development of

electronic health records for all Federal employees by utilizing our

Federal Employees Health Benefits Program for EHR purposes. We

25

are creating a model for consumers, employers, and insurers to

build comprehensive electronic health records for all individuals.

In addition, I have recently introduced H.R. 4832, the Electronic

Health Information Technology Act of 2006, along with Chairman

Porter. H.R. 4832 seeks to accomplish two major goals: first, it will

codify the office of Dr. Brailer and strengthen his role as the leading health information technology standard-setting authority in the

Federal Government; and, second, the bill seeks to partner with the

private sector through grants and a direct loan program that will

provide key economic assistance for institutions seeking to expand

their EHR capabilities.

If we continue our pursuit of utilizing IT through the health care

delivery system, we are sure to experience shorter hospital stays,

improved management of chronic disease, and a reduction in the

number of needless tests and examinations administered over time.

The creation of such a network will prove far more efficient in both

economic and human terms.

This concludes my remarks, Mr. Chairman, and I ask that they

be included in the record.

Mr. PORTER. Without objection.

Mr. CLAY. Thank you.

Mr. PORTER. We have some procedural matters, and I ask that

we have unanimous consent that all Members have 5 legislative

days to submit written statements and questions for the hearing

record; that any answers to the written questions provided by the

witnesses also be included in the record. Without objection, so ordered.

I also ask unanimous consent that all exhibits, documents, and

the materials referred to by Members and the witnesses may be included in the hearing record; that all Members be permitted to revise and extend their remarks. And without objection, it is so ordered.

It is also the practice of this subcommittee to administer the oath

to all witnesses, so if you would all please stand, I would like to

administer the oath, and please raise your right hands.

[Witnesses sworn.]

Mr. PORTER. Let the record reflect that the witnesses have answered in the affirmative. Please be seated.

We are honored today to have a very special guest who is a leader in many areas of our country on many issues, but one in recent

history, in combination with, I believe, Senator Clinton, he has become a champion on moving health information technology forward.

Mr. Gingrich, Honorable Newt Gingrich, understands that health

care is only as good as its weakest link, and a weak link is that

of information flow and some of the current technology. I believe

that Mr. Gingrich also understands that we have some of the best

doctors and health care professionals in the world, but we need additional information technology available.

So, Mr. Gingrich, we welcome you today and look forward to your

comments, and you are now recognized for 5 minutes.

26

STATEMENT OF HON. NEWT GINGRICH, FORMER SPEAKER OF

THE HOUSE

Mr. GINGRICH. Well, thank you very much for inviting me to this

very important hearing, and I am delighted to see a bipartisan effort such as this by Chairman Porter and by Congressman Clay,

and it is something I very strongly support as a general direction.

I am also delighted to be back with my good friend, Congresswoman Norton, who has done just a tremendous job representing

the city, and under very difficult circumstances at times, and has

been stunningly effective.

I also want to note that you have a very, very good series of panels. Dr. Malik Hasan, who has been a pioneer for many years in

this area and who at HealthTrio has developed a SNOMED-based

language approach that is very sophisticated and the next generation, Dr. Jane Barlow of IBM, and others are all going to be, I

think, very helpful to you.

I do think bipartisan efforts in this area are useful. That is why

Senator Clinton and I actually met launching a House bill. Congressman Tim Murphy and Congressman Patrick Kennedy introduced a bill in this general area, and we shocked everybody by

showing up together to say we were for it. But I think this is an

area where we can save lives and that is very important.

I start with a very simple premise. Paper kills. Paper prescriptions increase medication error; 8,000 to 9,000 Americans a year

die from medication error. Paper records in hospitals make it much

harder to have accurate, quality systems; 44,000 to 98,000 Americans a year die from errors in hospitals. If we had a pandemic,

whether it was the avian flu or an engineered biological attack, the

losses because of the absence of personal electronic health records

could be in the millions.

I would also point out that personal health records are not a radical new idea. The Veterans Administration, an area where Government has truly pioneered, has been a leader and now has over 13

million electronic health records. PeaceHealth in Oregon, Washington, and Alaska has about 1,400,000 people with electronic health

records. The Mayo Clinic in Jacksonville has been paper-free since

1996. Kaiser Permanente has about 13 million people with electronic health records. And TRICARE, the Defense Department

health system, is beginning to roll out an electronic health record.

So the capability is real.

We at the Center for Health Transformation believe that the

Federal Government can dramatically improve the health of all

Federal workers with personal health records, and I agree with

Congresswoman Norton’s observation that it is better to get into

this by volunteerism and incentives than it is to try to coerce everybody. But let me just point out that 93 percent of the country

believes they should have the right to quality and cost information

before making a health decision; 90 percent of the country believes

you should mandate electronic prescribing in order to avoid medication error. There is a huge potential market that will sign up for

this if given a chance, and it has an impact both in saving lives

and in saving money.

The Indiana Heart Hospital, for example, reported an 85-percent

reduction in medication error by going to electronic records.

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PeaceHealth in a pilot project in Eugene, Oregon, using a GE

Healthsystem model, indicated an 83-percent reduction in medication error, a 40-percent improvement in diabetes control, and a

100-percent improvement in LDL control for cholesterol. So these

are important things.

I would urge—and I believe your bill captures this—individuals

should own their own personal health record. This is about their

life. Doctors can keep a copy for legal and administrative and medical reasons. Hospitals or labs can keep a copy. But the core universal document should belong to the individual, and current privacy

laws protecting personal health information clearly apply to electronic data as well.

Let me go a step further and say you should in passing recommend to your friends on the appropriate subcommittee that

Medicaid needs to change its law so when people leave Medicaid,

the information could actually be transferred to their job or business. It currently is not. It is technically blocked. And it strikes me

as an anachronistic and actually a destructive provision.

The individual’s right to know, I would urge the committee to

look at myfloridarx.com and floridacomparecare.gov. These are two

Web sites developed by Governor Jeb Bush, and the Federal Employees Health Benefits Plan should offer exactly the same service

nationally for all Federal employees. Myfloridarx.com, you can actually go online, put in your Zip code, the drug you want to purchase, and every drug store in your area shows up with its price.

And it turns out in one neighborhood within 2 miles, there is a

100-percent difference to buy a particular drug. At one drug store

it is $101. In another drug store, it was $203. And as you can imagine, people rapidly talk to each other when that price differential

is that big, and so it is a big, powerful tool to give citizens the

power to make choice to save their own money to lower costs.

The floridacomparecare.gov actually lists number of procedures

done by a hospital, quality of the outcome, and price, and is already having a substantial effect in informing Floridians.

I would also suggest you look at the Humana and Blue

CrossBlue Shield of Florida joint venture called Availity, where

they are now going to connect at least a third of the State, and if

they add Medicaid, over half of Florida will begin to have medication and other records online.

I would also point out, as Congressman Clay noted, I think with

legitimate pride, that in addition to the work you are doing, which

is exactly right, there is effort underway with Congressman Clay’s

H.R. 4832, with the bill that Chairwoman Johnson and Chairman

Deal introduced, H.R. 4157, with Congressman Gingrey’s H.R. 4641

creating a tax deduction for doctors who want to buy equipment.

I would strongly urge you to encourage your associates to reform

Stark and anti-kickback law so that hospitals can provide electronic health records, because if you combine that with this bill,

you won’t have to have any kind of trust fund. The fact is if you

modify Stark and anti-kickback rules, the hospitals of this country

will save so much money by having electronic transfer of information rather than paper transfer that they will provide virtually

every doctor in the country with an electronic health record capaVerDate 11-MAY-2000 10:48 May 07, 2006 Jkt 000000 PO 00000 Frm 00031 Fmt 6633 Sfmt 6633 D:\DOCS\26715.TXT HGOVREF1 PsN: HGOVREF1
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bility at no cost. They are today blocked from that by an essentially

obsolete law.

Let me also suggest that we need an accurate scoring caucus.

Fred Smith of FedEx was the first person who got me to think

about this because he pointed out that he could never have invented FedEx with Congressional Budget Office scoring, because

they cannot distinguish investment from cost and they do not understand market effects. You are about to see this with Medicare

because the market effect of the new drug benefit is going to come

at least 30 percent under the projection in cost because it turns out

competition is driving down the cost, and we are actually driving

down the cost of prescription drugs for America’s senior citizens.

Central Utah Multi-Specialty Clinic invested in electronic health records. They believe they will save $14 million over 5 years. I do

not believe the Congressional Budget Office would score a penny.

The Henry Ford Health System in Detroit has introduced elec- tronic prescribing. They believe for a $1 million investment they

saved $3.5 million the first year in the cost of drugs as doctors prescribe less expensive medication, and they believe they are saving

3 hours a week per nurse for not having to sit online talking to a

pharmacist. I do not believe the Congressional Budget Office would

score a penny. If we could take the $4.4 billion a year in waste that the New

York Times estimates for New York State Medicaid alone, if you

could take the fraud and waste out of the current system, and if

you could take the inaccuracy and paper out of the current system,

I think we could afford to cover with a very large tax credit every

single citizen and have a 300-million payer system.

I give you this as background because you cannot get there as

long as the Congressional Budget Office has an obsolete, reactionary, bureaucratic model of scoring that denies the power of the

market and denies factual evidence from the private sector. That

is important for this project because one of the things I want to

suggest to you is that you consider introducing as part of this—and

I like your bill very, very much. But consider something we did to

get hospital quality reporting. In the Medicare bill, we said hospitals that report quality will get 0.1 percent more from Medicare,

and hospitals that fail to report quality will get 0.1 percent less.

That happened to score out at zero under CBO rules.

I would urge you to consider that by the 3rd year the Government will pay more if you have an electronic health record and less

if you have a paper model. And the analogy I will give you is electronic ticketing. Electronic ticketing for airlines is not more expensive. It is cheaper. And it is so much cheaper that Continental Airlines 2 years ago announced that for 1 year they would give you

a paper ticket but charge you $50 for the paper ticket, and at the

end of 1 year they would never give you a paper ticket. You could

print out your own at home, but they were simply never again

going to deal with having to have paper.

Now, this is the direction of the future. I very strongly support

this bill, and I will close with this observation because I think this

is a very intelligent bill moving in exactly the right direction. And

I particularly like, Chairman Porter, your point that this would

not—as I understand your interpretation, this would not have OPM

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creating an entire new pattern of standards but, rather, would

have OPM looking to HHS to adopt and follow the leadership of

Secretary Leavitt, who I think is doing an extraordinary job in this

general area.

The reason I really like your bill so much is that you are the first

folks I have seen who are directly using the power of the Government as a purchaser—not as a regulator, not as a controller, but

just simply saying, look, if you want to come and provide insurance

for the largest single private purchasing of insurance in the world,

which is the Federal Employees Health Benefits Plan, terrific; we

just want you to migrate toward making sure that any Federal employee that wants it can have an electronic health record for themselves and their family.

Using the Federal Government’s purchasing power will change

the health system faster than any possible regulatory regime, and

I think this bill is a very, very important step in the right direction, and we would certainly do anything we could—I would personally—to try to be helpful in making sure that this bill gets a full

hearing, and I would only hope it is signed into law this year.

[The prepared statement of Hon. Newt Gingrich follows:]

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Mr. PORTER. Thank you very much for your kind comments and

certainly the insights.

You know, a challenge is the provider side. I am old enough to

remember my doctor that carried the little bag and actually made

house calls. And the doctors of today are under a lot of pressure,

a lot of challenges, from Federal regulations, you know, the file

cabinet police that they are concerned that they are going to be put

out of business, privacy, also medical liability. And I would like to

ask you a question about the providers, but also add a comment

to that.

A companion to this bill I am going to be proposing is a medical

liability insurance incentive for the providers that take part in

using appropriate technology, that there be an incentive to reduce

some of their costs. Because you know medical liability cost are literally putting health care professionals out of business. We have

had signs in Nevada at OB/GYNs on their buildings that say ‘‘For

Rent’’ because they are concerned about liability, the point being

that we have had some improvements in Nevada as of late, but the

medical liability is not in my jurisdiction, Mr. Speaker. Of course,

it is a different committee. But my plan is to add that as another

part of this to make sure that providers have another incentive, because it will save lives and reduce the cost of insurance.

But to my question: Do you have any other thoughts on encouraging the doctors—and the doctors, bless them, are not necessarily

always good business people, do not always get along with each

other because they are very independent, and they are specialists.

Do you have any additional ideas?

Mr. GINGRICH. Well, let me make three points about this. You

have put your finger on a very key reason, and I think this is part

of what Congresswoman Norton was saying when she was saying

lots of people tell us where we need to go, but they don’t necessarily tell us how to get there. And it is the how to get there

sometimes that stops us, even when we are all in agreement. So

I want to say three quick things.

First of all, I want to go back to a line I started with. Paper kills.

Any major purchaser who is allowing the system to continue to

deal with the people that they care about with paper is risking the

lives of those people. We know technically this is true, so I would

start by saying any doctor or any hospital that is not migrating to

health information technology is, in fact, saying that they are not

seriously concerned about killing people. It is literally that direct.

Second, the University of South Florida has a program they are

developing that I would commend to you where, if you use the electronic health record, it includes an entire section on informed consent, and they designed this to meet your point, which is how do

I get my doctors to think this is worth their while. And what they

figured out was if they could design, working with both trial lawyers and defense attorneys, an ideal model of informed consent so

that the doctor knew they had the minimum liability risk, the doctor would suddenly have a very direct interest in having that as

part of their health record. And so I would strongly recommend the

University of South Florida program as something you would want

to look into.

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Third, you might have to add this on the floor because of committee jurisdiction again, but I just want to go back to what I said earlier both about Congressman Clay’s bill, about the earlier work

that was done by Congressman Murphy and Congressman Kennedy and by the very important bill introduced by Congresswoman

Johnson and Congressman Deal, and that is, you should provide

somewhere that providers, whether hospital or doctors, who are engaged in serving Federal employees ought to have Stark and antikickback waived for the purpose of allowing the hospitals to provide the electronic health records. This is an enormous savings for

the system. It allows us to avoid the Federal Government getting

in the middle of it, and our estimate is that you would have virtually 100 percent coverage of doctors. But if you added that provision in, I think you would find that most of the electronic health

record problems would disappear within 2 or 3 years.

Mr. PORTER. Thank you.

Congresswoman, questions?

Ms. NORTON. Thank you, Mr. Chairman, and thank you again,

Mr. Speaker.

I wanted to—I am reading your testimony. I wondered if we may

be talking past each other. Maybe, because I haven’t seen the

wording of the bill, on page 16, the way the bill is worded, you indicate in your testimony on page 16 that—of course, the standards

have to come from the industry. What in the hell do we know—excuse me. What in the world does OPM or anybody in Government

know? You say, ‘‘The data standards embedded into any personal

health record through the FEHBP should be determined by health

information technology experts, not health benefits experts.’’

I have to assume that H.R. 4859, to which you refer, which gives

responsibility on data standards for interoperability to OPM, simply means that the Government does not say that the private sector can do anything it wants to do without anybody on our side

looking to see whether it basically conforms to status. You know,

to use an analogy, the Government puts, you know, contracts out.

One of the great—although this obviously is a huge contract, but

I will give you what is more typical. It has a gazillion contracts out.

Nobody monitors the contracts. And so, you know, you are on your

own, contractors.

Well, this, of course, is something very special, and somebody in

Government—I am not sure who—would have to have some final

say if FEHBP is involved over what those who have the expertise

design as standards.

So I wonder if this is even a matter of disagreement here, but

the way in which you pose it in your testimony makes it look as

though it may be.

Mr. GINGRICH. Well, let me say first of all, I may have not been

clear, and I apologize to the gentlelady if I was not clear. I strongly

believe that the Department of Health and Human Services, which

is a Government agency, has a primary role in helping develop

standards for interoperability in terms of health records nationwide. And Secretary Leavitt has organized an American Health Information Community, which has been meeting regularly, and I

think Secretary Leavitt is moving in that direction. My only observation—I think it was conforming with what the chairman said in

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his opening remarks—is I think OPM is better directed to follow

the lead of HHS and allow HHS to be the primary standard setter

for the whole country rather than to have a second electronic

health record standard program being developed at OPM, which I

think would be redundant and, frankly, not nearly technically as

competent.

But within that framework, you and I are on the same road. I

am a Theodore Roosevelt Republican. Theodore Roosevelt decided,

after reading Upton Sinclair’s ‘‘The Jungle,’’ which has a scene in

which a man falls in a vat and gets turned into sausage, which he

supposed read shortly after breakfast, and he sent up the Food and

Drug Act of 1903 as a consequence. I like the idea that any free

market restaurant I go into anywhere in America has drinkable

water. I like the Government guaranteeing that minimum. Now,

they can compete on price and quality and food, but they have to

get up to drinkable water before they get to play. They have to get

up to edible food.

So I agree with you. There are certain standards—and I mention

in here, for example, I think the Government should make clear

that electronic health records are ultimately the property of the patient. They are not the property of the insurance company. They

are not the property of the doctor or the lab. They belong to the

person about whom they are developed. It is a very important distinction from where we have been in the past. And so I agree, Congresswoman Norton, I think your point there is well taken. And my

only observation was to not have redundancy between two Government agencies.

Ms. NORTON. We do not need to be regulators here. We need to

just make sure the standards are what they say they are.

On page 12 of your testimony, first of all, let me say I am pleased

to see that you agree that the guinea pigs should all be willing. We

are both enough of libertarians to understand that, that we do not

want to get into new controversy when we are trying to get out of

it with this—when we begin this.

I would like your views, frankly, Mr. Speaker, on how this should

be begun. I mean, I agree with you, here is a group of—a rather

closed group at that—people who use the same insurance companies and the rest. You know, it is a very large group, very varied

group. They are a group of very high political and educational consciousness, and they all work for the Federal Government.

If you wanted to begin with the Federal Government, have you

given any thought to how you would approach the notion of getting

employees of the Federal Government to be those who first cast out

this notion with their own health care plans?

Mr. GINGRICH. Well, let me say first of all that I think if you look

at what the Veterans Administration is experiencing, they will tell

you that they are very, very excited and happy with the electronic

system they have. They want to improve it and upgrade it, but

they really do believe it has been a remarkable breakthrough, and

it is a place where the Federal Government has been a real leader

in creating the technology——

Ms. NORTON. But those are the veterans, not the employees, I

take it.

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Mr. GINGRICH. Right. But I think everybody who works with it

who is a Federal employee would tell you, they are for having that

kind of record. They have seen the power of that kind of a record

system. I think at TRICARE—and these are Federal employees—

Defense Department employees are now going to have a, everyone

eligible for TRICARE is going to end up with an electronic health

record. That is happening.

So in a sense, what you are doing is extending into the private

sector and into the private market for the civilian Federal employees, something which is absolutely happening for the Defense Department, for those people who are eligible for TRICARE.

Third——

Ms. NORTON. But many of those are veterans and their families,

right?

Mr. GINGRICH. That provides active duty military, reservists and

retirees.

Ms. NORTON. They always can make you do what they want to

do, but when you are dealing with a civilian work force where——

Mr. GINGRICH. No. My only point is that these—again, I agree

with your point. I would certainly be inclined at this stage to make

it available, not make it mandatory. But I think because the Federal employee work force is actually a pretty smart work force, you

are going to see an amazing number who say, ‘‘Yes, I want that,’’

particularly when they look at 83 percent reduction in medication

error. I mean the Federal work force is not stupid. And they look

at, OK, I can improve my chance of not getting the wrong medicine

by 83 percent. I can improve my chance of managing my diabetes

by 40 percent. I can improve my change of managing my cholesterol by 100 percent. I mean these are numbers from real studies

in real medical facilities around the country. So I think you will see

a very rapid migration in this direction.

I would hope that looking at this hearing, and looking at conversations that I know that the Director of the Office of Health Information Technology at HHS, Dr. Brailer, has had with OPM, I

would hope that when OPM issues their letter, I think April 15th

or so, asking for next year’s bids, that they will have provisions

that are very parallel with this bill, that they will be following

carefully the leadership of Chairman Porter and Congressman Clay

in looking at how to make the—and I would certainly hope they

will take your advice, Congresswoman, and do it in a positive way.

My experience has been, when I talk to people in the consumer

care area who are in the private sector, that somewhere between

a third and 90 percent of the work force in blue collar factories

choose electronic health records once they understand the option,

and that it grows very rapidly as people talk to each other about

why it is an advantage.

Maybe I am too optimistic, but as you know, that has always

been one of my weaknesses. But I am very happy to make it voluntarily initially, make it incentivized, encourage them to do it, and

I think it will grow much faster than people expect.

Ms. NORTON. I couldn’t agree with you more. I don’t think you

are being overly optimistic. I think you would have a confluence of

the young people in the work force, and the older people in the

Federal work force, for very different reasons, and if anything, you

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would have more people perhaps than any pilot of this kind could

use.

Finally, let me say that I very much agree with you that if we

can find a way to deal in a bipartisan way, take the privacy matters, take the technology matters, and feel comfortable with them,

that they—and Stark and anti-kickback laws removed or considerably reformed, would do exactly what you say they would do. From

the point of view of the hospital, now having to communicate with

physicians in ways that hark back to the early part of the 20th century, I do believe that the incentive for them would be greater than

the incentive for us.

So I thank you very much for all of the hard thinking you have

done in this area. It is typical of you, Mr. Speaker.

Mr. PORTER. Mr. Clay.

Mr. CLAY. Thank you, Mr. Chairman.

Let me echo too what my colleague has said. I appreciate Speaker Gingrich’s efforts and leadership in a national health IT infrastructure, and helping to make that a reality.

Let me ask you about the Federal Government. Since we administer the Medicare and Medicaid programs, what lessons can be

learned by the entire health care industry in terms of improving

the quality and efficiency of care provided to the general population? Are we becoming more effective in implementing programs

that demonstrate positive results in both public and private health

care settings? And you also mentioned to Delegate Norton that the

VA has a model program as far as IT and electronic health records.

Maybe you want to expound on that a little.

Mr. GINGRICH. That is a very good question. Let me say that

probably the two largest pioneers at personal health records were

the Veterans Administration and Kaiser Permanente. Both of them

have very sophisticated systems. The VA system is now based on

a relatively old software, and so is the Kaiser Permanent system,

about a 15-year-old software. But there is no question that it has

worked and that it has provided a dramatic improvement in quality

of care.

The biggest lesson I think you learn out of this is that when you

can gather—two things happen—when you can gather data about

individuals, you can provide them much better prevention, a much

better chronic disease management, and they take better care of

themselves because they know their status better, and the doctor

can take care of them better.

Second, when you gather enough data on a depersonalized level,

you begin to see patterns. There is no accident that it was the electronic health record at Kaiser Permanente that first indicated

Vioxx was a problem because they saw enough different records simultaneously electronically that their expert systems could say,

wait a second, we have more people showing up with heart problems than should be. So you suddenly had them saying, wait a second, here is an early warning, that in a paper-based system might

have taken 3 extra years.

So it is the combination of more accurate information about you

personally and a better ability to survey the whole system that

really leads to these dramatic improvements. And I do think, as a

conservative who is often very critical of Government, I do think

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you have to give the Veterans Administration a lot of credit for

dramatic pioneering in an area that is very, very important.

Mr. CLAY. Are we in a position today to quickly detect and respond to major public health emergencies such as SARS and cases

of bioterrorism, given the challenges that remain in health IT, and

have the standards established through Dr. Brailer’s office brought

better response capabilities to those utilizing electronic health information systems and records?

Mr. GINGRICH. I am probably more adamant about this than almost anything we talk about, and I appreciate you asking the question. I believe, if you look at the disaster of Katrina, and the failure

of the city of New Orleans and the failure of the State of Louisiana,

and the failure of the U.S. Government, all three of which failed

the people of that area—I say this as a graduate of Tulane and my

younger daughter was born in New Orleans—I believe that there

is no reason to believe that the Federal Government today, or the

State and local governments today, are any better prepared for a

major catastrophe of a biological nature, an avian flu pandemic or

an engineered biological attack than they were prepared after

Katrina.

I think that people are kidding themselves. Every day that we

don’t have a 21st century virtual public health service that ties together 55,000 drug stores electronically, every veterinarian in the

country, every dentist in the country, every nursing home in the

country, every doctor, every hospital, and every retired doctor,

nurse, pharmacist, veterinarian and dentist, because if you had a

real crisis you would have to surge all of those assets in real time,

and every day you failed people would die.

Second, after you look at a 1,100,000 paper records—I spoke to

the American College of Cardiology on Monday in Atlanta at their

annual meeting. And they got a briefing about New Orleans. We

lost 1,100,000 paper records in the Gulf Coast, 1,100,000. Now,

somebody who is getting chemotherapy for their cancer suddenly

had no records. And the fact that we are sitting here a half year

later and do not have a Federal bill to create as a national security

matter—remember, in 1955, President Eisenhower said we needed

a National Defense Highway Act so we could build interstates so

if we had a nuclear war people could evacuate the cities. It is a

dual use system. Middle class people travel all over America.

Trucks use it every day, but it was originally designed as a national defense matter.

The fact that we do not have today a national defense health information infrastructure act, I think is an enormous mistake. And

if we get unlucky, we will lose several million Americans for not

having built the system. So I appreciate you asking me that question.

Mr. CLAY. Let me, just in closing, Mr. Chairman, out of curiosity,

if we eliminate all of this paper, what kind of pushback do you

think we will get from the paper mill industry and logging industry? [Laughter.]

Mr. GINGRICH. I have a number of friends in the paper industry,

and I want to assure you that they are confident that the Government of the United States will find enough new ways to generate

paper. [Laughter.]

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That none of them think they are going to become endangered

by the elimination of medical records. But I appreciate your concern for them.

Mr. CLAY. Thank you, Mr. Speaker.

Mr. PORTER. Thank you.

Mr. Cummings, do you have any comments or questions?

Mr. CUMMINGS. First of all, good afternoon, Mr. Speaker, good

seeing you again. I was just listening to you talk about Katrina,

and I thought about the will to do something like this, the will to

do this. You talk about the highways. It sounds like this is a good

start to do something that is very positive, but I think what happens—and maybe you can help me with this—is do you think the

Congress does not have the will to do these make-sense kinds of

things that—I mean when we look at Katrina and we see how bad

off our emergency systems were and are, when we consider September 11th and I guess we all pretty much assumed that we were

in a better position than we were on September 11th, and we really

don’t see much improvement since September 11th. And this is in

no way knocking Republicans or Democrats. I am just throwing

this out as a general concept. It just seems to me that we—somebody told me, I will never forget, when I first ran for office, he

says—I was down like 15 or 20 points within 3 weeks of the election, and this guy told me, he said, ‘‘Look, I’m not the campaign

manager.’’ He says, ‘‘Most people know what to do to win, but they

don’t have the will to do it, and they don’t do it.’’

I think we know what we need to do, the things we need to do,

but it just seems like there is so much going on that distract us—

just like we were able to build a highway system, probably some

folks said full sped ahead, and got it done. I am wondering, you

know, how much faith do you have even if we put something like

this on the books, that it would happen?

Mr. GINGRICH. Let me say first of all, I appreciate that question

more than you can imagine. I think it is very thoughtful and I

think it captures the great difficulty that I had the 20 years I was

serving actively. I think every Government class in the country

ought to read what you just said, because you just captured the dilemma of the American system. Let me break it into a couple parts.

First of all, the Founding Fathers wanted to avoid dictatorship,

and so they consciously designed a machine so inefficient that no

dictator could force it to work. [Laughter.]

They did such a brilliant job we can barely get it to work voluntarily, and they would look down and say, ‘‘That is exactly right.’’

This is part of—days when I am about to go crazy, I just laugh and

remind myself, Washington and Franklin and Madison and all

those guys are really happy because this is really hard.

Second, we are at one of the great turning points in American

history, and you nailed it just now. And I would immodestly suggest if you go to my personal Web site, Newt.org, there are two papers there. One is on 21st century entrepreneurial public management, and the other is on transforming the legislative branch. The

point I make there is exactly your point at a core level. The system

is broken. I describe it as that we have inherited this box, and this

box is an 1880 male clerk sitting on a wooden stool with a quill

pen and an open ink well. That is the Civil Service Act. It is 125-

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years-old. Modified by a 1935 New Deal bureaucracy, where you

use a manual typewriter with carbon paper.

I was telling the administration just last summer—because I developed this model originally looking at Iraq and the global war on

terror, and I was going around before Katrina saying, ‘‘We are

going to have a catastrophe,’’ because this box doesn’t work.

I would say to you, if you look at FEMA’s total failure, you look

at the current SBA problems, and you look at the Corps of Engineers, the fact that the Congress is not doing aggressive oversight—and let me say this as a Republican—I don’t care if we have

a Republican President, our Constitution is designed to have very

aggressive oversight by the legislative branch because it is the only

way the system works, just as, by the way, I think the President

should occasionally veto things because it is the only way you retain balance. The system is designed for this conflict. But you all

should be right now taking apart FEMA and rebuilding it. You

should be taking apart the Small Business Administration and rebuilding it. You should be taking apart the Corps of Engineers and

rebuilding it, because, I mean, how much more evidence do you

need than the last 6 months? So I think you and I are close together.

What I am intrigued with is these things take time. Remember,

I cited the Eisenhower 1955 proposal for an interstate highway system. Eisenhower wrote a book called ‘‘At Ease: Stories I Tell My

Friends,’’ and in one of the stories he had in that book, he said in

1919 he led the Army’s first transcontinental truck expedition. And

he remembers sitting on—actually in your State, Congressman Porter—he remembered sitting under the stars in Nevada, having

crossed a stream, imagining to himself what it would be like to

have highways that connected the whole country. 36 years later, as

President, he proposed that system.

These things sometimes take time. I am up here, cheerfully optimistic, because I think with your leadership we are going to get

electronic health records for Federal employees, and that is going

to be a major break in the system. And by the way, by the time

you take care of the hospitals and doctors and take care of Federal

employees, you just took care of 50 percent of the doctors and hospitals in the country, and from the standpoint that legitimately I

would hope a number of you have for the disparities and outcomes,

you get to an electronic health record—and we worked very closely

with Morehouse Medical School and Dr. David Sacher, Dr. Elizabeth Ofili on this. We are going to dramatically reduce the disparities and outcomes if we have electronic health records. I mean

these are a big breakthrough.

So what you are doing may be a building block toward a dramatically bigger future, but that was a great question and a great observation, and you put your finger on a big deal.

I will say one last thing. I had a great honor yesterday. The

State of Florida, the House of Representatives down there—they

only have a 9-week session—they took an entire day off to have a

workshop for all their members on transforming health in Florida,

and it was very interesting how they did it. It was a very powerful

moment of everybody stopping, you know, no packed fundraiser, no

running off to constituents, no 205 other assignments. And we had

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a ton of members of the Florida Legislature deeply engaged in

learning and talking and thinking. It was a very encouraging moment.

Mr. CUMMINGS. Thank you.

Mr. PORTER. Mr. Van Hollen.

Mr. VAN HOLLEN. Thank you, Mr. Chairman. First, let me thank

you, Mr. Chairman, for introducing this piece of legislation because

I do think it is a very important conversation to start. The conversation has begun, but this is an example of something we can

maybe move forward on as an example from the Federal Government. As I told you yesterday, I think using the Federal program

to begin to push others in the country in the right direction is a

good idea, and, obviously, the details need to be worked out and

there are a lot of important details to be worked out.

Let me also thank you, Mr. Gingrich, for your many ideas you

have had in the area of health care recently. I don’t always agree

with every one, but I have to tell you, the more ideas that are

churning out there, the better off we will be as a Nation, because

I think this is an area, as I know you have said, where we can have

dramatic improvements going forward. I agree that Congress needs

to be more aggressive in its oversight in a whole range of areas,

and I think the question of competence is something that the

American people are going to come to value even more highly than

they already do, and as a Government, whether it is Republican or

Democrat, we owe them a higher degree of competence than we

have seen in many recent instances.

Let me ask you, with respect to just some of the—and I don’t

know if you have had an opportunity to look at the details of the

bill—but one of the issues is whether or not you are going to allow

people to voluntarily opt into this system, or whether you are going

to set it up so they are required to automatically be enrolled, and

given the fact that the Federal Government is launching an experiment in this area, and the fact that a lot of people are concerned

about the privacy implications of electronic records, do you have a

view on that question?

Mr. GINGRICH. I was earlier associating myself with Congresswoman Norton’s position because—and I say this at a practical

level—if we try to impose, and we arouse all the privacy advocates

and we arouse all of the Federal employee unions, that will slow

this bill down so much, that if we can get it to be voluntary in

Phase I, I think we will actually have more people signed up in the

length of time it would take to fight the bill through if you have

a lot of opposition. So I would rather make it a voluntary system.

I did suggest the incentive of saying to the plans we would pay

slightly more in the 3rd, 4th and 5th year if it is an electronic

record and slightly less if it is a paper record, and that would

incentivize the plans to encourage people to join.

But I think you are going to get—if you look at e-ticketing nowadays at airports, you know, Americans aren’t stupid. As Americans learn—and I said it earlier, examples of 83 and 85 percent reduction in medication error, that saves your life; 40 percent improvement in diabetes management, that saves your life; 100 percent improvement in cholesterol management. These are case studies in places that have used these records. Federal employees are

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smarter. They are a very smart group collectively, as you know,

and I think they will talk to each other. Within 3 or 4 years it will

be in the high 90’s. And I think, frankly, if the last 3 percent would

rather have paper and risk dying, that is their prerogative as a free

people.

Mr. VAN HOLLEN. Thank you. I think you are right. I think the

amount of resistance you are going to get is not worth the effort,

and I think that people will see this as a good thing and voluntarily do it.

We don’t have a lot of time. What is going on—and I apologize,

Mr. Chairman for being late. We had a briefing in the Judiciary

Committee.

But in the private sector, to what extent is there movement?

How rapid is the movement in this area, and where do you predict

that going, and how important do you think it is to move forward

in this area in order to get the rest of the market to move?

Mr. GINGRICH. You are asking the right question. First of all,

there is enormous movement in this area. There is a tremendous

new program at the University of South Florida, which I was just

getting briefed on yesterday in Tallahassee. There is a big project

by Humana and Blue CrossBlue Shield of Florida called Availity,

which will cover a third of the people of Florida, and if they had

Medicaid will be over half the people of Florida. Kaiser Permanente

has 13 million health records nationwide that are electronic. The

Veterans Administration has about 13 million health records that

are electronic. As you go around the country, Peace Health in Oregon, Washington State and Alaska, has about 1,400,000 health

records that are electronic. So as you go around the country you

just see the momentum beginning to build in that direction.

One of the things I am passionate about is modifying Stark and

anti-kickback so that hospitals can provide free health information

technology equipment to doctors they are legally barred today from

doing. They can’t even provide it to each other. So, for example, the

largest hospital in western Michigan would probably provide health

information technology to all the small rural hospitals in the upper

peninsula, but it is currently illegal under Stark and anti-kickback.

Well, that is utterly irrational.

The Federal Government, unfortunately, is not going to pay for

it. As a national security matter I would have the Feds pay for it

and get it done in 2 years. If they are not going to pay for it, the

easiest source of sophisticated capital is the hospitals. They actually save enough money, if patients are transferring in electronically rather than in paper, they save a lot of money on unnecessary

labs that don’t need to be taken. So I would encourage you to look

at that as a major component of this.

Mr. PORTER. Thank you very much. Mr. Speaker, we appreciate

you being here. Once again, it was an honor to have you here. We

look forward to working with you. Thank you.

Mr. GINGRICH. Thank you.

Mr. PORTER. In the element of time I am going to combine actually the second and third panel, so if both panels will come forward, please, we will have a chance to get the table set up.

We will start with Mr. David Powner, who is Director of Information Technology Management Issues, Government Accountability

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Office. We will then have Dr. Jane Barlow, Well-being Director,

Health Benefits Operations with IBM; then have Mr. David St.

Clair, founder and CEO of MEDecision, Inc. Dr. Edward Ewen, Jr.

was going to be with us, but had to take care of a patient. Dr. Paul

Handel will be next, who is vice president and chief medical officer,

Texas Division, HCSC; Jeannine Rivet, executive vice president of

United Health Group and then Dr. Malik Hasan, who is CEO,

Health View, retired CEO of Health Net. So we will start with Mr.

Powner.

STATEMENTS OF DAVID A. POWNER, DIRECTOR, INFORMATION TECHNOLOGY MANAGEMENT ISSUES, U.S. GOVERNMENT ACCOUNTABILITY OFFICE; JANE F. BARLOW, M.D.,

MPH, MBA, IBM WELL-BEING DIRECTOR, GLOBAL WELLBEING SERVICES AND HEALTH BENEFITS, THE IBM CORP.;

DAVID ST. CLAIR, FOUNDER AND CHIEF EXECUTIVE OFFICER, MEDECISION, INC.; PAUL B. HANDEL, M.D., VICE PRESIDENT AND CHIEF MEDICAL DIRECTOR, BLUE CROSS BLUE

SHIELD OF TEXAS (A DIVISION OF HEALTH CARE SERVICE

CORP.); JEANNINE M. RIVET, EXECUTIVE VICE PRESIDENT,

UNITEDHEALTH GROUP; AND MALIK M. HASAN, M.D., CHIEF

EXECUTIVE OFFICER, HEALTHVIEW, RETIRED CHIEF EXECUTIVE OFFICER, HEALTH NET

STATEMENT OF DAVID A. POWNER

Mr. POWNER. Chairman Porter and members of the subcommittee, we appreciate the opportunity to testify on health care information technology. As we have highlighted in several recent reports completed for Chairman Davis of the full committee, significant opportunities exist to use technology to improve the delivery

of care, reduce administrative costs, and to improve our Nation’s

ability to respond to public health emergencies. This afternoon I

will briefly describe the importance of information technology to

the health care industry, discuss key Federal leadership efforts to

bolster the adoption of IT, and highlight key aspects of your proposed legislation, Mr. Chairman, that are critical to achieve the

President’s goal of a nationwide implementation of interoperable

health care systems.

Information technology can lead to many benefits in the health

care industry that we have reported on over the past several years.

For example, using bar code technologies and wireless scanners to

verify the identities of patients and their correct medications can

and has reduced medical errors. In addition, surveillance systems

can facilitate the timely collection and analysis of disease-related

information to better respond to public health emergencies. Its

standards-driven electronic health records have the potential to

provide complete and consistent medical information necessary for

optimal care.

Just last month, the Select Committee that investigated Hurricane Katrina concluded that the lack of electronic health records

contributed to difficulties and delays in medical treatments to evacuees. Fortunately, several efforts led to the development of a Webbased portal to access prescription information for these evacuees.

This highlights the importance of electronic records with even limVerDate 11-MAY-2000 10:48 May 07, 2006 Jkt 000000 PO 00000 Frm 00061 Fmt 6633 Sfmt 6633 D:\DOCS\26715.TXT HGOVREF1 PsN: HGOVREF1
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ited information, which was made possible when commercial pharmacies, health insurance programs and others made accessible key

prescription data.

Several major Federal health care programs, including Medicare,

Medicaid and OPM’s Federal Employees Health Benefits Program

provide health care services to over 100 million Americans. Given

the Federal Government’s influence over this industry, Federal

leadership can lead to significant change, including the adoption of

IT. Given this, in April 2004, President Bush called for the widespread adoption of interoperable electronic health records within 10

years, and established the position of the National Coordinator for

Health IT.

Although the coordinator has issued a framework, established

working groups of industry experts and awarded contracts to define

a future direction, we have testified and recommended that the National Coordinator: one, establish detailed plans and milestones to

carry out the President’s call for interoperable health care records;

two, complete detailed plans with private sector input for defining

standards to enable interoperability of data and systems; and

three, to fully leverage the Federal Government as a purchaser and

provider of health care.

Turning to your proposed legislation, Mr. Chairman, I would like

to commend your action to leverage the Office of Personnel Management as one of the largest purchasers of electronic health benefits to advance the creation of electronic health records. The Federal Employees Health Benefits Program has over 8 million beneficiaries and advancing electronic health records to this critical

mass would be significant. Your focus on electronic health records

is critical since they are a central component of an integrated

health information system. In addition, they have the potential to

reduce duplicative tests and treatments, and could lead to reductions in medical errors.

Another key aspect of your proposed legislation, Mr. Chairman,

is its focus on adopting standards that are consistent with the National Coordinator’s efforts. IT standards are critical to enable

interoperability of data and systems, and it will be especially important if carrier-based records are to be interoperable with provider-based information.

We remain concerned about the development of such standards

and highlighted these concerns before Chairman Davis at a full

committee hearing last fall. Although the identification of standards continues to be one of the major focus areas for the National

Coordinator, to date, the standard-setting processes have resulted

in conflicting and incomplete standards, and the consensus on the

definition and use of standards remains a work in progress.

Hopefully, the standard-setting initiatives will gain momentum

in the near future so that provisions of your bill calling for these

standards can be carried out.

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In summary, Mr. Chairman, efforts like your proposed legislation

that provide tangible solutions to jump start adoption rates of electronic health records, and that leverage Federal programs and resources are critical to carrying out the President’s goal.

This concludes my statement. Thank you, Mr. Chairman, for

your leadership in driving this much-needed technology.

[The prepared statement of Mr. Powner follows:]

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Mr. PORTER. Thank you very much.

For those who are here for the first time at a congressional hearing, understand that Members will come and go for different committee hearings happening at the same time. We may even be

called to vote on the floor here at some point. But know that your

testimony is very valuable and is a part of the record being scrutinized by a lot of folks. So we appreciate you being here. The number of people here today is not a reflection of the importance of this

issue. It is just the process with multiple committees happening at

the same time.

Dr. Barlow, welcome.

STATEMENT OF JANE F. BARLOW, M.D.

Dr. BARLOW. My name is Jane Barlow. As well as being Director

for IBM’s Health Benefits Operations, I am responsible for the delivery of $1.7 billion in health care to over 500,000 IBM beneficiaries in the United States each year. I appreciate the opportunity to testify on behalf of IBM in support of this important legislation.

IBM’s strategy in health benefits is simple. We focus on health

people for high performance. This strategy underscores investment

in health to realize the productivity and innovative potential of our

employees. The personal health record is critical to achieving this

goal.

In 2005, IBM announced that it would provide personal health

records to its entire U.S. work force. To set up the records, employees enter information in a secure Web site. They input such things

as medical conditions, family history, medications and allergies.

Later this year, their personal health record will automatically import their medical and prescription drugs claims history. The ultimate goal is to enable all types of health information to flow into

the record to form a comprehensive portable portrait that the patient can access when they desire and share with their provider

when they choose.

Since we rolled out personal health records late last year, over

45,000 IBM employees have signed up. It is important to note we

are not creating new information. The carriers have always collected claims data. It is how they pay bills. But the personal health

record will allow our employees to look at their comprehensive

claims history, many for the first time. I believe electronic health

records will drive two changes in health care. First, they will increasingly make health care organize around the patient; and second, electronic health records and their related systems will improve our employees’ interaction with their doctor.

Let me explain. The personal health record empowers consumers

with the information they need to actively manage their health and

health care. As a result of the personal health record, our employees are asking more questions about cost and quality. With this

broader personal health history, they are able to have a collaborative relationship with their physician that extends beyond the

day’s illness to address the most important health needs for that

individual. This informed relationship with their provider is critical

to improving health care quality and reducing costs.

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With the aid of electronic health records and the tools to support

them, providers will have all the information about a patient and

can focus on the most important health issues for that patient

across the continuum of care.

Let me give you an example of feedback I received from a happy

employee. This employee reported suffering depression for most of

her adult life. As a result of participating in our disease management program, she was able for the first time, to work with a provider who had a comprehensive view of her medical history and

other personal factors. They were able to identify a successful

treatment plan for her, and she reported that this had totally

changed her life, and for the first time in 18 years she felt fully

alive and productive.

My hope is that the personal health record will afford this opportunity for every patient.

Provider adoption of personal health records is key. While the

legislation establishes some incentives, reforms and reimbursement

and additional sources of funding will have a dramatic impact on

the adoption and value of the electronic health records created by

the act. Finally, this bill will help lead the critical transition to digital health care by allowing the exchange of health information in

standard electronic formats.

IBM strongly supports the use of standards. We believe standards are critical and necessary to ensure providers and patients

have the information they need.

In summary, personal health records will drive a more innovative and efficient patient-centric system. Personal health records

are the foundation of a standardized infrastructure for the electronic exchange of health care information, one that enhances the

ability of providers to deliver high-quality care.

Finally, improving the health and wellness of a work force,

whether at IBM or across the Federal Government, is a strategic

investment that can pay substantial dividends, promoting greater

economic competitiveness and capacity to innovate.

Thank you.

[The prepared statement of Dr. Barlow follows:]

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Mr. PORTER. Thank you, Dr. Barlow.

Next we will have Mr. St. Clair, founder and CEO of

MEDecisions.

STATEMENT OF DAVID ST. CLAIR

Mr. ST. CLAIR. Good afternoon, Mr. Chairman. Thank you for inviting me to testify before this subcommittee today on what we consider to be a very important topic.

As you said, I am David St. Clair, Founder and CEO of

MEDecision. We are the recognized market leader in collaborative

care management solutions for the health care industry. Our clinical systems are used nationwide to help coordinate care for about

one in every six insured people in this country, including millions

of Federal employees and their families.

I am here today representing two other organizations as well. I

am here on behalf of HIMSS, the largest trade association for

health information technology, and I am here as the spokesman for

the CollaboraCare Consortium, an alliance of 16 innovators in the

emerging regional health information market.

We believe that electronic health records will really improve the

way health care is delivered in this country. Using technology to

facilitate collaboration among health care stakeholders will result

in the right information reaching the right people at the right time,

which can improve lives, indeed, save lives, and make health care

more affordable in the process.

We need not wait until physicians and other providers fully embrace the use of electronic medical record systems in their practices. Sharing information that already exists within payer repositories, with individuals and their care team can improve health

care outcomes.

For these reasons, MEDecision, HIMSS and the CollaboraCare

Consortium, enthusiastically endorse the Federal Family Health

Information Technology Act of 2006.

There are just a few points I would like to emphasize in my testimony today, and as you will hear, many of them really speak to

the notion that of the things that are called for in the proposed legislation are already well under way in the private sector.

My first point is, our success at creating and deploying carrier

based health records, which we call the payer-based health record

[PBHR], has already demonstrated the value of those records at

the point of care. In his written testimony, Dr. Ed Ewen, a practicing physician with the Christiana Care Health System in Delaware, and their head of Clinical Informatics, underlines his belief

that the information in the Blue Cross Blue Shield of Delaware

PBHRs, being used in the Christiana Care Level 1 Trauma Center,

has, one, improved the quality of care being delivered to patients

in need. For instance, they found that the PBHR gave them substantially more—their quotes—medication information 48 percent

of the time than they had through any other means. And two, that

effort has decreased the cost of that higher quality care.

The key to understanding the value of carrier-based health

records is illustrated in the graph on my left. We have laid out the

population. This data is from the 3.7 million health records we created last month for the Blue Cross Blue Shield of Illinois popuVerDate 11-MAY-2000 10:48 May 07, 2006 Jkt 000000 PO 00000 Frm 00097 Fmt 6633 Sfmt 6633 D:\DOCS\26715.TXT HGOVREF1 PsN: HGOVREF1
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lation. We have laid them out based on their relative burden of illness. As you can see on the left, the sickest 5 percent of the population, which represents, by the way, over 40 percent of the total

health care spent for this population, have, on average, 11 different

medical conditions, including three chronic care conditions, and

those individuals have taken 13 different classes of medications

and seen 9 different providers of care within the past year.

This population, more than any other, is in need of assistance in

bridging the information gaps or the information chasms evident in

the medical community today. Just one of these patients generates

raw claims data that fills 60 pages that I have in my hand here

today. What we have as a technology challenge and clinical challenge is to reduce that to the four-page summary that we are using

today in the State of Delaware, and soon in the State of Illinois.

My second point, the technology we use have been creating valuable information from payer data for over 10 years. In 2001 we

started using the PBHR to support case and disease managers as

they worked with those individuals with the chronic diseases. For

instance, Blue Cross Blue Shield of Massachusetts uses the payer

based health record to drive their disease management programs

both through telephone contact and tailored correspondence.

Third, if you direct your attention to the second graphic here, our

belief, since I started the company 18 years ago, is that we need

to be able to share a composite view of a patient’s history with all

members of the care team, the patient themselves to help with

their own decisionmaking, with the clinical staff who are actually

treating the patient, and with the care managers, the case managers and disease managers who are helping coordinate their care.

While there will still be decisions to make and perhaps disagreements, at least we are all starting with the same basic information.

Fourth, last year, in anticipation of the destruction of Hurricane

Katrina, we partnered with Blue Cross Blue Shield of Texas, and

created 830,000 payer-based health records for the potential evacuees along the Texas Gulf Coast in 4 days. When Rita stormed

ashore, Blue Cross Blue Shield of Texas was ready.

This year we have created 3.7 million payer-based health records

for the membership of Blue Cross Blue Shield of Illinois in 4

weeks. We will be extending that capability across the populations

for Blue Cross Blue Shield of Texas, New Mexico and Oklahoma,

all for their parent company, Health Care Services Corp.

We and the physician executives of HCSC—and you will be hearing from Dr. Handel in a few minutes—will be working with the

provider communities and consumer advocates to roll out secure access to these records by the members and by the physicians who

treat them. Our success with the project in Delaware we replicated

on a much broader scale with 10 million records available nationally. I want to point out that represents 3.3 percent of the U.S.

population who will have electronic records available from one

payer in 1 year.

Finally, that brings me to the last point, access and cost. The

PBHR, whether enhanced by PHR data or not, will improve the

quality and safety of health care for virtually everyone who participates. We strictly adhere to HIPAA privacy and security regulations and allow individuals to opt out of the program if they have

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privacy concerns. In addition, we implement data filters that respect State law, prohibiting the sharing of certain classes of information. The key for adding a voluntary PHR—and we have five

such partners in the CollaboraCare Consortium—is it will allow

consumers who wish to share all their data, some of their data, or

none of their data to control that process at a granular level.

The technology and delivery infrastructure is very inexpensive

when used across a broad population. Based on our experience in

Delaware, we would project that the PBHR and PHR programs

being called for in the legislation will cost well under $1 per member per month for that coverage, which represents a very small

fraction of the monthly premium for those particular individuals.

Thank you very much for the opportunity to testify before the

subcommittee today. I am prepared to take any questions you may

have.

[The prepared statement of Mr. St. Clair follows:]

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Mr. PORTER. Thank you very much.

Next we have Dr. Paul Handel, who is the vice president and

chief medical officer Texas Division, HCSC. Welcome.

STATEMENT OF PAUL B. HANDEL, M.D.

Dr. HANDEL. Chairman Porter, thank you very much for inviting

Health Care Service Corp. to submit formal testimony on the electronic health record.

I am Paul Handel. I am a doctor with approximately 40 years of

clinical experience in caring for and caring about patients. At the

present time I am vice president and chief medical officer, Blue

CrossBlue Shield of Texas, a division of Health Care Service Corp.

My testimony today will reflect the position of Health Care Service

Corp. I am not representing the Blue Cross Blue Shield system in

any fashion.

HCSC is a non-investor owned company that operates through

four divisions in Illinois, Texas, New Mexico and Oklahoma. We

cover approximately 10 million lives, and we are now the fourth

largest carrier in the country. We firmly believe that electronic

health records can benefit health care in the United States by increasing the accessibility to quality care and making health care

more affordable.

The record, the electronic health record, as your own experience

that you related about your mom, and David talked about a few

moments ago, really looks toward our elderly population and the

sickest part of our population, which consumes the vast majority of

our health care resources. These people are invariably unable to

give concise histories because of either age, underlying conditions

or perhaps even their medications. They also have a team of physicians that are caring for them. They have multiple ancillary providers that are involved, and their histories become relatively unclear.

Without a question, collating the data for these people will be instrumental in improving their health care.

Additionally, the connectivity that we are envisioning here will

facilitate the education and the provision of preventive services to

all of our population, and, candidly, in the big picture, that will address what I think is a graver, much larger issue, and that is the

spiraling increase in our health care costs.

We have a large data base of electronic information. We realize

the value this data has on the development of electronic health

records, and for our own members in particular. We have already

begun to focus on providing claim-based personal health records to

our members because we believe it is an extremely effective way

to positively impact their outcomes.

I want to emphasize that we are just now beginning to learn

what information is useful, and how do we educate consumers, physicians and other providers as to the value of the electronic health

records. The flexibility to continue to innovate is absolutely imperative.

We have heard a fair amount of discussion today from everyone

concerning Katrina. I can tell you that in Texas, we lived through

over 300,000 people coming to Texas as refugees without any

health care information. Most of them could tell their doctors they

were taking a blue pill, a yellow pill, they had received treatment

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for cancer, but they didn’t know what drugs they were taking. It

was a real debacle.

As we prepared for Rita, we prepared within 4 days time, from

a Thursday morning to Monday morning, patient clinical summaries on 830,000 patients across the Gulf Coast, and into western

Louisiana. We partnered with the Texas Medical Association, and

on Monday morning, 4 days after starting our efforts, we were able

to put forth an 800 number by either e-mail or blast fax to over

40,000 Texas doctors, a contact point where they could get the patient clinical summaries if anybody had been displaced and showed

up in their practices.

Our success in creating the electronic plan-related health records

for the hurricane victims really pushed us forward to roll out our

records to all of our members in HCSC. We will start the program

in Illinois with approximately 3.7 million members, and continue to

roll that out through the remaining divisions over the course of the

year.

The core reason why we began to implement a health record like

this for our members is that we will not consider saving money or

reducing medical errors, but on a higher level, to ultimately improve the accessibility to quality and affordable health care for all,

and parenthetically, in the process, we will probably save money

and reduce medical errors.

In conclusion, I would like to stress the importance of allowing

health plans to continue to create innovative products with the

flexibility to make changes that meet local customer needs and

market demands. We agree with the need to utilize technology to

establish uniform standards for health data, facilitating interoperability, efficiency of communication and safety. We believe that implementing a payer-based health record is the right thing to do. We

will continue to pilot projects for developing various means of electronic transmission of plan-related health information in this way.

We feel that other carriers will find the most successful features

to create value and usage for the personal health records.

Thank you very much.

[The prepared statement of Dr. Handel follows:]

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Mr. PORTER. Thank you very much, doctor.

Next is Jeannine Rivet. I hope I pronounced your name right.

Executive vice president, UnitedHealth Group. Welcome.

STATEMENT OF JEANNINE M. RIVET

Ms. RIVET. Good afternoon, Chairman Porter. I appreciate the

opportunity to share with you our experiences in offering personal

health records to the consumers that we serve. I am Jeannine

Rivet, executive vice president of the UnitedHealth Group, a diversified health and well-being company, dedicated to helping people

achieve improved health and well-being through all stages of their

lives.

UnitedHealth Group’s family of businesses offers a broad spectrum of products and services to approximately 65 million individuals nationwide, everything from commercial health plans to Medicare offerings such as Part D drug plans, Medigap, Medicare Advantage Plans, Medicaid services, health analytics and informatics,

and specialty solutions such as nurse triage services, centers of excellence, dental, vision plans and behavioral coverage.

To our UnitedHealth business we also offer health benefits to

Federal employees and annuitants under the Federal Employees

Health Benefits program, 14 States and the District of Columbia

with more than 322,000 members enrolled in our various plans. At

UnitedHealth Group we have invested heavily in technology as

part of our efforts to advance the quality of care provided to individuals and to improve the efficiency of our health care system.

Our investment in technology allows us to provide our plan members with comprehensive information about the cost and effectiveness of different treatment options, as well as to help them find the

highest quality providers. This type of information, we believe, is

critical to improving outcomes and to enabling consumers to maximize the value they receive for their health care dollar, and to

more easily manage their health care.

One of the primary ways we provide this type of information to

our members is through our consumer Web site, myuhc.com. Members can log onto UnitedHealth’s Web site and find top-performing

providers who meet objective quality and efficiency criteria, or find

information on hospital quality for more than 150 procedures. They

can order prescription refills and they can compare the cost of drug

alternatives, and receive monthly statements providing explanation

of benefits for all services.

Last spring, we expanded our Web site capabilities by integrating a personal health record that gives consumers greater access to

and control over their health care data so that they can make informed decisions. Through myuhc.com, which is a secure Web site

that protects the privacy and security of members’ data with user

names and passwords, our members can use their personal health

record to view their full history based on claims data, store information on their medical histories, as well as contacts with health

care practitioners and upcoming appointments, receive condition

specific alerts and appointment reminders, enter and track clinical

data such as glucose levels and blood pressures, as well as their

own information and lifestyle behaviors such as weight and sleep

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habits, and they can enter notes, reminders and personal observations.

In addition, members have the option of giving their physicians

and family members access to their personal health records including access to their personal health summary, which is a printable

health summary, detailing the most recent conditions, medications,

procedures and lab results, which is viewable online or through

swipe card technology.

Currently, about 41⁄2 million consumers have access to a personal

health record through our Web portal. We too have a Hurricane

Katrina example regarding the impact and positive results from

having a personal health record. Within the greater New Orleans

area we were a critical resource to our members. They use their

personal health records to reestablish health care records including

medical, lab, pharmacy and immunization records with their physicians’ offices since many of the physicians were dislocated, or their

offices were flooded and the data was lost.

As part of our effort to design a responsive personal health

record, we conducted a number of in-depth telephone interviews

and focus group sessions with consumers, physicians and employers. We gathered some very helpful information through these efforts. Some common themes were: accessibility, portability and convenience are key benefits of a personal health record. Primary concerns, not surprisingly and already noted, were Internet security,

privacy and accuracy of data. And everyone felt that the personal

health record would enable the patient-physician interactions. Consumers had a very positive response to the concept and were open

to using personal health records. Physician awareness was mixed.

Once the personal health record concept was explained, physicians

responded favorably. However, noted concerns regarding the cost of

the personal health record and the possibility that patients may be

able to block out information from the health care provider.

Their concerns over the cost of personal health records verified

the need for incentives for adoptions such as the one, Chairman

Porter, that your bill contains. Employers have limited awareness

or experience with a personal health record. However, again, once

explained they saw value, primarily for their employees, but less

value for themselves as the employer. And all consistently recognized the need for further education on ease of use, benefits, security and confidentiality.

Based on our experience and research, we continue to refine our

direction, focusing on enhancing the consumer position relationship. Also we have identified a number of requirements for facilitating widespread adoption that you may wish to consider as you

move forward with your efforts to expand use of personal health

records in the FEHB program. Most important, a strong and consistent information and education campaign that clearly shows the

value of using a personal health record, as Ms. Norton referenced

earlier. Also a tailored consider experience, which is organizing

data and features in a manner that makes it easy to navigate and

access information of choice, with health information displayed and

described in ways that are easy to understand.

Secure and private infrastructures and processes are critical. Accurate and timely information will build trust and credibility.

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Flexibility is needed to address consumer needs, preferences and

desires. Fully integrated records to create easy access for the individual. And we agree with you, Chairman Porter, interoperability

with provider office technology is necessary.

In closing, let me say that at UnitedHealth Group we are confident that the use of appropriately designed personal and electronic health records will make a significant difference in improving health outcomes for individuals, and will make it easier for

them to manage their health care effectively. That is why we have

invested considerable time and resources.

Chairman Porter, we appreciate your leadership on this very important matter, and thank you for the opportunity to share our experiences with you today, and I would also be happy to answer any

questions you may have for me.

[The prepared statement of Ms. Rivet follows:]

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Mr. PORTER. And we thank you for being here. We appreciate it.

Next, Dr. Malik Hasan, CEO of HealthView, and retired CEO of

HealthNet. Welcome.

STATEMENT OF MALIK HASAN

Dr. HASAN. Thank you, Mr. Chairman, and let me thank you on

two counts: first, for allowing me to present my view; and, second,

I am also your constituent and voted for you. [Laughter.]

And it seems like I voted right. I am very happy with my vote.

Mr. PORTER. I may ask you to say that again someday, so don’t

forget that, OK? Thank you.

Dr. HASAN. As you will notice from my bio, I have had a very

diverse experience in the delivery of health care in the United

States. I have firsthand observed the flow of information and the

current limitations in physician offices—because I used to run a

physician office—hospitals, because I was involved in the operation

of a hospital, also the free-standing facilities, and was the founder

and operator of a major health plan. The experiences allowed me

to observe the gaps in care. Such gaps result in poor coordination

of care with the resultant poor and expensive care. Resources are

very poorly utilized.

The introduction of the electronic health record, as envisaged in

this bill, will start bridging those gaps and commence the transformation of the health care delivery system which is sorely needed, because it is not just the Federal employees. Once the carrier

starts a process for Federal employees, they will also extend it to

their other employee groups and other members, thus starting a

snowballing effect.

The features of the electronic health record as described in this

bill are essential to achieve the goals which are envisioned in this

bill. The bill allows the creation of a longitudinal record, starting

with the carrier’s input and entries by the consumer and additional

information imported from the provider’s EMR, thus providing ultimately a very complete medical record which is important for the

continuing care of the patient. This will also provide prompt and

accurate access to a medical record in an electronic format to the

patients and, more importantly, also the providers who are not familiar with the patients, with better understanding of the problems

and their management. This electronic record provides a record

which, as I mentioned above before, is going to be very important

for the continuing care of the patient.

In addition, the integration of the SNOMED—and this alphabet

soup stands for Systematized Nomenclature for Medical—I am

blocking on the full name. But it is in my written testimony—allows the information to be encoded as opposed to being just text.

And it allows for its proper arrangement and organization within

the record. It also enhances the privacy feature because the information is encoded. You can basically rifle-shoot which information

should be available to whom as determined by the patient, rather

than giving full access to the record.

The encoding of data through SNOMED is described more fully

in attachment two. It will take too much time for me to go over

that here. It would in the future also allow outcome measurements

leading to standards for evidence-based practice of medicine, popuVerDate 11-MAY-2000 10:48 May 07, 2006 Jkt 000000 PO 00000 Frm 00136 Fmt 6633 Sfmt 6633 D:\DOCS\26715.TXT HGOVREF1 PsN: HGOVREF1
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lation-based studies, profiling the providers, and making it much

easier and cheaper to conduct drug trials.

One of the problems with the drug trials is that the FDA considers that anytime they are going to approve something, it is going

to be in the public domain and, so to speak, can be withdrawn, nobody is going to look at it. On an electronic record, you can survey,

keep on the surveillance, and pull out the medicine as soon as some

red flag arises.

SNOMED also allows the patient to have full control over the

records and fully protect the privacy. So far, any attempts at reforming health care have invariably centered around the reform of

health care financing rather than addressing the root causes of

poor and expensive care. This legislation is a joint step toward

elimination of the barriers to the high-quality, cost-effective care.

We are fortunate to have the finest physicians and hospitals, but

this advantage is compromised because of a lack of electronic

health record. The absence of an electronic health record creates an

environment that prevents proper coordination of care, allows ignorant care, and even worse, inappropriate care, which is duplicative,

wasteful, and allows serious errors. This legislation will go a long

way in eliminating all those sins of commission and sins of omission.

Thank you, Mr. Chairman, and I am prepared to answer any

questions.

[The prepared statement of Dr. Hasan follows:]

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[The prepared statement of Dr. Ewen follows:]

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Mr. PORTER. Actually, you are all going to be lucky because we

are going to be called to vote here shortly, so there is not time for

a whole lot of questions. But we are going to be giving you questions, if you could submit within 5 days some of the responses.

I want to make a comment, and then I am going to ask a question. I met with a veteran the other day, and I know we have

talked about the Veterans Administration here really at length

today. He is probably in his mid to late seventies, and he actually

was here with the Veterans of Foreign War, as they traditionally

come this time of year to talk about veterans issues. And one of his

colleagues was a doctor, and I just happened to mention this bill

that we are talking about today. And the gentleman that I am referring to that was in his late seventies, he had a huge smile on

his face. And he said, ‘‘You know, I am now receiving care through

the Veterans Administration,’’ and he started bragging about the

personal health record. He went on and on and on, on how he could

communicate with his doctor, he could read it, he knew exactly—

and as Speaker Gingrich said, he had ownership. It was a tremendous example of what I am hoping every American will be able to

have to take advantage, hopefully with this bill’s passage, moving

it along much faster than originally envisioned.

But having said that, I wanted to share that with all of you, that

this is a real person, a real veteran with real health problems, that

is just so excited to break down these barriers and have ownership

of his own health care. But with the limited time, I would like to

ask Mr. St. Clair a question. We talked about the system being voluntary or an opt-out. Would you comment, with your expertise in

this area, on that particular portion for the participant, please?

Mr. ST. CLAIR. Certainly, Mr. Chairman. I was interested in

Speaker Gingrich’s remarks around the notion of voluntary participation in systems like this, particularly when he also mentioned

the fact that disaster recovery, responding to crises, was a very important goal of his.

Our view is that basic transport of clinical information that follows the HIPAA regulations is the most appropriate way to respond to the crisis in quality of care and patient safety and to crises of different sorts in this country. So we need to be able to mobilize data that exist within the walls of payers to benefit the patient

through treatment in an opt-out environment, in our opinion.

However, having said that, the use of personal health records is

truly a voluntary act, and we believe that one of the real benefits

of implementing both the payer-based health record and the personal health record systems at the same time, or essentially at the

same time, is that the personal health record lets those early

adopters who want to make sure that all of their information can

be sent to their doctors in emergency rooms and others when they

are seeking treatment control that process and put more information in and make corrections. But, on the other hand, it also allows

those who really don’t want it to happen to opt out very, very easily. We currently allow opt-out procedures for folks who are having

their information processed in our systems and delivered on behalf

of our customers, but we think that the trickle of records that

would come in would prevent the vast majority of providers, physiVerDate 11-MAY-2000 10:48 May 07, 2006 Jkt 000000 PO 00000 Frm 00154 Fmt 6633 Sfmt 6633 D:\DOCS\26715.TXT HGOVREF1 PsN: HGOVREF1
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cians and others in this country, from ever changing their work

flow to adapt to the presence of records.

The fact that we can go into the State of Illinois with 3.7 million

records really makes it so that the hospitals, the emergency rooms,

the physicians there will automatically build into their work flow

the notion that those records are available. If only 5 percent of that

3.7 million opt in and we are not allowed to distribute the rest, no

hospital, no doctor will bother to do that, other than those on a

very, very sort of early adopter phase. So we think it is really an

issue of proving to the Nation that, in fact, this basic kind of information should be delivered unless people say they do not want it

to be delivered.

Mr. PORTER. And this question is to whoever would like to respond. As I have been meeting with the different insurance companies and the providers that have instituted this new technology,

and they all brag about the advantages, but to an organization,

they have talked about the challenges of a cultural change within

the business, not only for the doctors but also everyone up and

down the food chain.

My goal with the trust funds, or whether we can fix it through

Judiciary and other means, is to also have some of these funds

available to help in training and transition, because at Sierra

Health Services of Nevada, Health Plan of Nevada, we spent a lot

of time looking at their system. And I spoke of it earlier in my

opening comments on how successful it has been.

But they said one of their biggest challenges was the cultural

change, and in my prior life, I did work for an insurance company,

and we went through major technological changes—I date myself—

in the 1980’s and the 1990’s and transitioning. I know that there

was a challenge. But do you have any insights on this change of

culture once the hardware and the software is in place on encouraging this change more rapidly?

Dr. HASAN. Edison invented the electric bulb, which is a very obvious and a very easy thing to use. It took over 30 years to be integrated in the usual life and the work flows and work processes.

The PC, we are seeing the benefit of the PC revolution, which

started in late 1970’s, early 1980’s, now. So we will have to be patient and make it available, going back to the issue of whether it

should be mandatory or whether it should be voluntary. For the

carriers it should be, in my opinion, mandatory. For the membership, it would be—by nature of it, it would be voluntary, whether

they use it or not, but it has a negotiating effect. Once people start

using it, get the benefit, like you spoke to that person from the Veterans Administration, people have that experience, they go out,

talk to their friends, speak to their acquaintances—that is how you

will see the culture change. Culture is not going to change by mandate. Culture is not going to change by legislation. But what legislation can do is to make it available for the people to change their

habits and their culture.

Mr. PORTER. Yes?

Dr. HANDEL. I think Dr. Hasan is on target. The other thing we

realize is if we can integrate what we are doing into the normal

work flow of offices and hospitals, that is going to make a big difference also. If this is looked upon as yet another hurdle to overVerDate 11-MAY-2000 10:48 May 07, 2006 Jkt 000000 PO 00000 Frm 00155 Fmt 6633 Sfmt 6633 D:\DOCS\26715.TXT HGOVREF1 PsN: HGOVREF1
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come, another major problem, I think we will have resistance. But

the experience that we have had in Delaware already, where the

emergency room doctors initially did not want to use it, but now

they understand how valuable it is, has created a whole new culture very rapidly. And I think our job as the industry, if you would,

is to make this as easy and as integrated into the work flow as possible.

Mr. PORTER. Yes?

Dr. BARLOW. Chairman Porter, I would like to suggest that there

are actually two cultural changes that need to take place here. One

is the change to move from thinking about health care in a provider-centric model to one that is moving to thinking about health

care in a patient-centric model. And what I mean by that is care

today and the information that we have in order to deliver care

centers around the provider and what they have and what they can

effectively get from other individuals to be able to support that patient.

Giving the patient more information to give their provider helps

to change the provider’s focus to a more patient-centric model, but

we really need to get where we can totally organize data around

that patient so that any provider, anyone who interacts with the

system thinks about it in terms of the patient, not themselves and

what they have. I think that is key.

Mr. PORTER. If I can interrupt, you know, in Las Vegas, we have

40 million visitors a year. Think about that. You know, the State

is only 2.2 million people, but we have 40 million visitors. And as

I have visited the hospitals and the emergency rooms and the trauma center and talked about health care delivery to our visitors, one

of the major—the largest hospital in Las Vegas that is part of

Humana, they said 8 or 9 percent of all their emergency room visits are by visitors from somewhere else, and how frustrating in trying to deliver health care when they cannot find out any information. They are not sure of the meds. Sometimes they cannot communicate. And I think you are absolutely right. It has to be driven

from the patient, and that is an example where if you travel anywhere in the world, you should have access.

I am going to conclude the meeting because we are going to vote

here shortly, but I just want to leave you with one thought. I started the meeting today talking about a foster child. You know, these

foster kids do not have the advantages of the latest technology, and

they do not have the latest in health care in many respects and

many times do not have a loving home to take care of other than

a foster parent trying to be their parents.

I firmly believe, as I said in my opening comments, that by working with a first-class system, which we have as Federal employees—we have the best in the world, and making it even better—

we will truly help those least among us in this country. And in

combination with the funds we passed in December, $150 million

to help with Medicaid and health information technology to transition, I believe that not only do we have the best system today, we

will have a far better system in the future.

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So thank you all very much for your testimony, and I look forward to working with you in the future. The meeting is adjourned.

[Whereupon, at 5:19 p.m., the subcommittee was adjourned.]

[The prepared statements of Hon. Wm. Lacy Clay and Hon. Elijah E. Cummings follow:]

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