the next we'll goo to next issing the abuse and fraud areas. there are about 20 amendments, i believe, minority staff will correct me if i'm wrong. i think there's a number like that on the abuse and fraud section. and a lot of -- the medicaid/medicare area. which of course we don't touch ourselves. nonetheless i understand the importance of that issue. i might add senator casey, if he wanted to -- while we're weighing for senator colburn to show up -- >> mr. chairman, before you go to that, since these are the last few amendments that we have on our title and we really do have to finish it so we can move everybody on to the next process, is senator colburn's staff ready to tell us which amendments that we are so we can limit ourselves to that, know what we're debating here? that would be very helpful for when he's going to show. >> i asked him that, if he'll amend the question; he wasn't quite sure. there are a number of coburn amendments. there are four he wanted us to offer # i'm not sure which four. >> do we know what time the

senator will be here, especially since i've defending this title, what time i need to be here for? >> he'll be here in a minute. i just thought it might be another filler. as soon as he shows up we'll stop. in order to use is time here in a fashion. we'll ask senator casey to give us opening thoughts on the abuse and fraud section. so we'll complete that part of the process. once we complete the four amendments on workforce we can move directly to the amendments on use and fraud. >> i'm honored to have a chance to review this section. i want to commend the staff. they've done, as they do on every section, great work. i was -- as a state official, both the auditor general and the treasurer. auditor general for eight years. state treasurer for two. in that decade, had the

opportunity to be involved in a lot of audits and investigations and reviews some of them involving these issues of waste, fraud and abuse. the way i look at this i think is the way we all look at it. waste and fraud and abuse is not just a bad thing for our system, for our health care system, it's a lot more serious than that. i believe that every instance of waste, fraud and abuse, no matter what it is, no matter what the dollar amount, represents a taking, almost like a thief in the night, taking resources from individual people that might impact their coverage or the quality of their coverage or the system itself to the point where you're denying people the kind of health care they deserve because you're taking by way of waste or fraud away from that. so this is critically serious business. this section is rather limited. so i think we can get through it

pretty expeditiously. there are nine provisions in the title. and i have to say, they come -- the result of these -- the results in this section comes from months of extensive interaction with groups directly engaged in the private sector. private sector efforts to combat waste and fraud. just a quick review of the groups that the staff and the economies consulted with. national association of insurance commissioners. national health care anti-fraud association. the national insurance crime bureau. blue cross and blue shield association. and the american health insurance plans. the health committee engaged in in a -- engaged the staff in a bipartisan way. not only in this committee but the staff at finance and aging and judiciary to get input and participate in these discussions and drafting. just by way of a quick update, this is the latest that i have. we have a total of 21

amendments, 19 of those being republican amendments. we have acceptance on two, to my knowledge. nz-103, nz-104. we're working on possible agreement on three senator burr amendments 1, 2, 7. we have a whole series of coburn and gregg agreements we don't have agreement on right now. also one by senator hatch. the total democratic amendments of course are two or three. i think there's a discrepancy in the number here. but two or three. senator sanders has i guess three. if i get that right. 6, 7, 8. he'll be offering -- he will not be offering for a vote but will talk about them. we're making a little progress on amendments. just a word about jurisdiction. the senate finance committee has jurisdiction over waste and fraud -- i should say fraud and

abuse efforts in public programs such as medicare and medicaid. and they are including strong provisions in their bill, the finance bill, on this. the health education labor pensions committee has jurisdiction over private, private health insurance anti-fraud activities. because of our jurisdiction over the health insurance portability and accountability account and arissa, as we know, the employee retirement income and security act. basically we do two things. one, provide new tools to the department of labor and state insurance officials to combat fraud and abuse in private insurance coverage. we also create opportunities for public and private sectors to come together and work together to increase effectiveness of anti-fraud and abuse activities. now, how much fraud is out there? no one knows exactly how much fraud and abuse is out there,

except every knowledgeable source agrees it's a lot and it's both public and private. the fbi estimated in the 1990s that 10%, 10% of all health spending was lost due to fraud and abuse. the national health care anti-fraud association estimates that 3% of all health care spending is lost due to fraud and abuse. i don't really care whether it's 10% or 3%. we know there's plenty of it. whatever the number is. we've got to make every effort to find it, to root it out, and to keep it from providing good health care for the american people. some suggest fraud and abuse is only a problem with the public sector programs. we hear that sometimes in discussions here in washington. the reality is otherwise. we believe that fraud and abuse is a major problem in the private market as well. the national association of insurance commissioners -- this isn't just one party or one point of view.

all of the insurance commissioners in the country have said this. their group has said this, i should say. "the number and scope of fraudulent and abusive health care plans has spiked as health insurance premiums continue to rise at double digit pace. they have a destructive ripple effect impacting every aspect of the health care system, consumers, employers, providers, licensed health plans and states. we all know that the department of labor plays a major role here. the dol's employee benefits security administration is a key enforcement agent. as of may of this year they initiated some 768 civil and 207 criminal investigations obtaining monetary penalties over $200 million. they currently have 73 civil and 60 criminal investigations open. criminal activities are often organized crime prices, result in employers and individuals losing millions of dollars a

year and going without health insurance. one final point if we have time, i'll go through some of the provisions quickly. the question of erisa and are we eroding protections and provisions in erisa. some have express ted concerns about that and are worried about eroding the essential structure of erisa. nothing, if you review this carefully, nothing could be further from the truth. these provisions in no way undermine the functions of erisa and self-insured employers and in no way allow states to undermine erisa preemption. what we do is give the department of labor and state insurance commissioners badly needed authority to stop criminal enterprises. let me just go through a couple of quick -- just a quick summary of the provisions. first of all, we have two new -- create two new positions. one in hss, department in department of justice. senior adviser, senior counsel.

they will provise oversight and coordination for health care fraud wind the federal government. second, the second section, b, even though we do have in place already a health care, fraud and abuse control program known as hcfac, we retain obviously that structure but we add to that what's known as the program integrity coordinating council. now, all that does is add to the responsibility of the program, meaning more coordination or responsibility for coordination as well as strategic planning, and also there's a provision that requires that this council provide or promulgate guidelines for federal agencies. section c is about false statements. we tighten that up because right now, the prohibition against false statements is rather narrow. if you have a false statement

that's in erisa documents, that can be prosecuted. we broaden that beyond just the fraudulent statements within the documents of erisa. the next section broadens the number of federal health care offenses in the multi-employer welfare association, so-called mewas. we add three crimes there. we also have language that will allow the proceeds of these specific crimes to now be subject to forfeiture. and the crimes also included in -- what will also be now included in specified lawful activity for money laundering offenses. what this does is allow, by designating that under the law -- i know this gets pretty technic technical, that's why we have good staff help here. by making that designation, it

allows us to use administrative subpoenas. so it gives more strength to help this era of health care offenses. and also broadens the areas that are subject to forfeiture. there's a section on the uniformity. we have a section that has the secretary of hhs requesting that the insurance commissioners develop recommendations for uniform reporting and referrals. so we have a specific manner in which referrals are made of suspected fraud. the next section is about applicability of state law. this is where you get into the erisa concerns. fraudulent insurance plans often allege state courts don't have jurisdiction pursuant to erisa or the liability risk reduction act. here's what they claim. they get sued in state court.

i'm talking about insurance plans that have committed acts of fraud. they get sued. and they say, no, no. state law doesn't cover this because we're not "in the business of insurance." what we do here, and therefore if you could show under state law that they were in the business of insurance, erisa would not allow. and you'd be able to bring a state action. what we do in the law, or in this subtitle i should say, is authorize the department of labor to adopt specific regulations establishing, and also issuing orders, as to when an entity is engaged in the business of insurance. so it clarifies that and allows state prosecutions to take place that may be prevented because of this lack of clarity as it relates to erisa. and finally, just two more

sections that i know senator coburn's here, we can move to the next agenda item. section g enables the department of labor to issue administrative summary cease and desist orders and seizure orders. the department of labor can issue these orders if it appears to the secretary one of three things. that the plan, the insurance plan, is alleged -- the conduct has been fraudulent. two, if the secretary believes there has been created an immediate danger to public safety or welfare. or three, if the conduct is causing significant imminent and irreparable public injury. finally the last section i'll summarize. there's more but i'll stop here. the multi employer welfare seeings requiring those plans to file a registration form with the department of labor prior to enrolling anyone. sometimes what happens is because they have a whole year

to file they start enrolling people, they go a whole year, they don't file this go@mi?ú?' @ n@ coburn. thank you for coming in -- >> i apologize. >> i know how busy everyone is. we've asked an awful lot of you over the last two weeks. everybody. i can't begin to tell you how grateful i am to our colleagues for how diligent they are to participate in this, knowing the demands on members. i'm grateful we've had as full a participation as we've had. >> i've got amendment 110.

coburn amendment 110. >> we'll get to it you. >> is this filed previously? or this is brand new? >> has this been a previously filed one? >> yeah, it's filed. it's got a number. >> i've not ever doubted that. >> can i ask a question -- >> chairman, we don't have it a as -- >> we'll get around to you. it's getting around to you. >> i think it applies to this title. actually, it will apply to any title -- >> it's not to this title. >> it's not? >> no. that's the problem. >> well, do you want me to withhold isn't it. >> why don't we withhold that and let's stick with this title if we can. we'll take a look at this anyway to see if there's some way we can reach an agreement on it. >> actually, when we filed this, it's insert where appropriate.

it applies to any title of the bill. >> it's not attached to this title, mr. chairman. i don't know how you want to handle it. >> well, look. i'll leave it up to you how we're going to proceed. >> well, senator coburn i understand had four amendments remaining on our title. are there other amendments? >> well, when this amendment was filed, it was filed as where appropriate. if you check with the parliamentarian, any title in which we add employees or new programs makes this jermaine.

>> mr. chairman. i'm sitting here. i'll go ahead if the senator wants to talk about his amendment. >> go ahead. let's do it. >> let's get it out -- we're going to get it out of the way before we finish. >> my time or yours, go for it. >> i had one question for the senator from washington. in the increase in the workforce bill, i think we go from 1.35 to 4.6. no, 5.6 billion. can you explain to me where we got that amount of increased money? in other words, how did we logically come to the conclusion that we need another $4.5 billion there? >> i'm sorry, could you repeat the question? >> the programs have been ramped up from i think $1.25 billion to $5.6 billion. is that not correct?

>> this title is not authorization andappropriations so i can't answer your question, sir. >> this authorization level and this legislation is a -- the authorization numbers are $5.4 billion, compared to $1.3 billion. what i'm asking is, what's the rationale for the $4.1 billion annual increase in authorized expenditures? >> well, i'm not sure exactly what the senator is asking. let me go back to what this title is about, which is to increase the workforce in order to make sure that we have access for health care. we are in the process of making sure that all americans have access to affordable, quality health care. one of the reasons we don't today is because we do not have enough health care workers to be

able to provide that coverage, and because we don't have enough health care workers it increases the cost for everyone. because to many communities there isn't access to doctors or whatever the challenge is. the point of this title is to increase the access ability of the workforce. >> and i presume what you talked about here is part of this title has had to do with issues involving the cost of additional education and so forth. those matters that contribute to whether or not we're actually going to be able to increase the number of people who will be delivering -- >> correct. >> -- the health care services from the providers generally but the increase in nurse practitioners, technicians and the like that would increase. that's what i'm presuming. that's where the increase, that 4.1 -- >> my question isn't about what it's for. i understand what it's for.

my question is how do we get the $4.1 billion increase, in other words, how did we come up with the $4.1 billion is too little, too much, or just right? >> well, mr. chairman, it's a ra tore ka questi rhetorical question. i know where the senator's coming from and looking at his amendment, which we're debating and i haven't heard his rationale for that yet. clearly in the programs we are outlining in this title, the goal is to increase the workforce. and there's authorization increases in some of these titles. but i don't know where the senator has gotten his numbers. >> tom, ready for your amendment? this is the amendment number 110. >> if i might just add my little two cents in on this, you guys always spend more than we got -- >> as you know -- >> a nickel. >> they got authorizations.

but then there's appropriations. so you can authorize anything you want but it has to come through appropriations. >> and be voted on. >> authorizations tend to be in general. they are not specific. they tend to look at what's needed out there, and authorization -- we never appropriate authorization levels. i wouldn't say never, but hardly ever. >> i'll get you the list of the ones you do. but you also appropriate things that are not authorized as well. to the tune of about $280 billion a year. >> well, there's a lot of things that are not reauthorized. usually there's an initial authorization but they've not been reauthorized very true. >> let's go to amendment 110. >> 110. we've got revenue progra47 new this bill. 20 in this title. which is going to require a significant increase in the federal workforce. this is just simple and said, if

we're going to ask american people to be a whole lot more efficient, to pay down our debt, to pay for this, that we ought to at least add some efficiency in washington. the purpose for this amendment is for every new employee that is forced to be hired under the authorization and appropriated money ultimately that will come, that the secretary has to have pay go. for every one you add, take one away somewhere else. if health care's our priority today, if that's what we think we ought to be fixing, we ought to see about lowering the priority of something else rather than just increasing the size of the federal workforce. the people who work over there do a great job. but what we ought to be is about putting priorities where we put our labor. and so this is straightforward. since we've added 67,000 new employees since january of this year to the federal government,

net, and the average total cost for an employee of the federal government counting fringe benefits is $135,000 a year, doesn't take long to multiply 67,000 times $135,000 to see the tremendous increase in cost of federal employees. wouldn't it be wise to make the agencies prioritize the use of their labor? so this amendment's straightforward. it says for every one you'll increase, you'll drop one somewhere else. or move someone rather than have a new hire. certainly not everything hhs does is as important as what we're doing in this bill. and the things that are less important right now for our country ought to have less labor put to it and more labor put to it in what we're passing. rather than say, whatever it takes we're going to just grow the size of the government. so that's in essence the purpose of the amendment. and if we get rid of it, i won't offer it again on any other

title, you have my word. >> mr. chairman, i guess we move to a vote, then. >> well, let me just say, i mean, this is -- at a certain level i suppose this amendment can be appealing. the idea of an exchange one for one. and this bill that we're dealing with health care, i think all of us recognize that our goal over the coming ten years and beyond that is to stabilize and reduce the overall cost of health care in the country. and we've all agreed, i think, even without having to sit down and work it out in the principles we're trying to achieve here. that is to achieve accessible, affordable, quality health care for all americans. we also i think all recognize as well that there will be investments that we should make in order to achieve those goals. information technology. getting more health care providers in the field. getting more nurse practitioners and others who will help us deliver the system.

putting in place ideas that will allow us for people to exercise the individual responsibility to change behaviors that will reduce some of the chronic illnesses that senator coburn has addressed. and various places there will be, i presume, either in time -- we certainly hope -- decreases in the number of people, a as we reduce the number of problems that exist, that cause people to end up in doctors' offices and hospitals. in others i presume there will be some increase in order to achieve the job. whether it's in information technology or increasing the number of people who will help us buy the number of health care practitioners we need or people who will help us reduce the dependency. i fear in a proposal that demands sort of a strait jacket approach or one for one obligation here, that we lose the ability for the flexibility that will be required in various places to achieve these results. and so we all ought to be trying -- i know it's the previous administration that held itself out as a

conservative fiscal administration, there was a significant increase. i was unaware of the particular numbers, the number of people employed at the federal level. obviously we need to do everything we can to restrain growth and to be responsible in that endeavor. i would feel irresponsible in this bill if we were to adopt an amendment that would demand an accounting without understanding where it's occurring, its overall effect, and how we're underhighing the purpose of what we're going to achieve to make investments to bring down cost. so i again respectfully, because i'm deeply appreciative of tom coburn's involvement, the knowledge he brings to all of this, i would say to this amendment, to my friend from oklahoma, this amendment i think is approaching this issue more with sort of a broad ax than the scalpel that my friend from oklahoma normally utilizes in his legislative approaches. for that reason would urge the defeat of the amendment. >> well, my chairman makes a wonderful debate. the problem is, we don't ask anybody else -- everybody else

in the country's doing this. every business is doing it. every home's doing it. and what the american people would like to see is us doing it. to make priorities. and i understand your lack of enthusiasm for this amendment. but it makes the point. we're going to spend money to save money. and we can spend less and save more. if, in fact, we do what we're requiring of everybody else in the country to do today. is to do more with less. and we haven't ever goinged out, under republican control or democrat control, how to do that. and it has to start somewhere. and this is a great place to start. the fact is, we're not highly efficient. in what we do. and a lot of the lack of efficiency we have, we don't know about because we don't do the oversight hearings to find out. i can relate some 70 that i've been involved in.

but the point is, what would the american people expect of us? we're going to -- we have 47 totally new programs in this bill so far. before we look -- and that's one-sixth of the total bill. with significant costs. and we're going to say, bureaucracy, do what you've got to do in terms of employees to do this. rather than say, bureaucracy, how about living within a realm. >> i can think of the analogy, a few years ago the congress over the objections of some decided community policing was a valuable program. the issue was reducing crime in our streets. and it was significant. and so we as a congress made a decision to invest, i think it was 100,000 police officers across america. and it was an increase in the number of people that were being hired in order to make our streets safer. the conclusion was we