of all of the mature and agencies across the country to a state of repair. when it comes to state of repair new jersey transit is a success story. from its investment -- from its in segment -- from its inception, we have focused on restoring the equipment and facilities to a state of good repair. it has taken three decades to bring new jersey transit to a state of good repair and we will need to continue to concentrate efforts in this regard to maintain infrastructure and equipment. in fiscal year 09 alone, we spent two-thirds on repairing capital maintenance.

during the '90s, we expensive and -- significant resources on the connectivity of the system, including midtown direct service to montclair and the construction of the frank lautenberg stations to secaucus. new jersey transit expanded the light rail systems in the 1990's. the hudson bird and light rail lines. had this -- as is public -- as those projects were completed, we emphasize the word in a set of good repair. that effort has reduced -- has produced tangible results. new jersey transit is in the middle of the largest rolling stock upgrade, providing the relocation of 41 pieces of equipment. we invested over $100 million in four critical mobile bridges, replaced by ducks, replaced wooden ties with concrete ties, and completed a automated upgrade. we declared in may of this year,

the new jersey capital transit programs have forced the state of good repair to the system. continuing this success will require renewed enhancement of federal funding and adequate funding for reaching a been to prevent premature degradation of equipment and infrastructure. how did we get here? it started with the bipartisan support 30 years ago and was recently, our focus on the state of the repair was reinvigorated by the governor, directing the authorization of the state transit trust fund and a jersey transit produced an annual investment in the state legislature. that strategy promotes a set of good repair as a top party followed by core capacity improvements and expansion of the reach of our system. new jersey has consistently provided funding for the trust fund, the new jersey transit capital expenditures. the governor has allocated more than 40% of new jersey's

transportation capital funds to new jersey transit. these funds are matched 141 by [unintelligible] from the federal government. -- these funds are funds1 for 1 federal funds. what to do to maintain good repair? i urge this committee and kong -- and congress to increase funding for public transportation through the rail modernization formula and the urbanization formula. as aging systems expand to meet demand, i would caution there are things congress should carefully consider. any kind program that distributes money in a way disproportionately decreasing funding to transit agencies in states of the repairs is problematic. i would suggest and the -- [unintelligible] another situation congress is considering is anything that

proscribes which projects advance ahead of others. it would not be prudent to determine which bridge should be fixed first. those decisions should be made by this closest to the infrastructure and equipment. we have made significant dance -- significant advances by making our top party and pushing decisions on how to spend good repair money down to engineers and eight nuns staff to evaluate and the structure and equipment. i have concerns related to proposals that suggest information about if the structure conditions should be collected on a federal level, put into a database where an algorithm would produce its list of what should be fixed. i want to reiterate that a state of good repair has been our top priority from its inception and i appreciate this committee allocating valuable time and resources to consider time and resources to repair the nation's transit agencies. >> thank you. dr. scott. >> thank you for the opportunity to present testimony regarding the state of good repair and

rail transit modernization needs. as we begin, i would like to also thank you for your extra night leadership on the issue which continues to haunt a number of transit systems like my own. just a few facts and perspectives about our transit rail modernization needs. candidly, the big ugly and the room, the state of good repair. we're the ninth largest in the united states and one of the future one transit stations designated by the degree of common security. we were created in the 1970's and funded locally by 1% sales tax. today, that sales tax generates over $300 million, down significantly over the last 18 months. annually, we invest over 50% of that local sales tax generated in the capital. every day, we carry more than half a million passengers.

we carry more people in our region on monday then reside in this it -- on one day than reside in the city of atlanta. we have had much welcome federal participation. this year, we celebrate 30 years of transit rail service in the atlanta region. our rail system includes 48 miles of double track, 38 stations, 330 real cars, 104 miles of mainline track, three railyards, 20 miles of yard track, 109 elevators, thousands of cameras, call boxes, vital really switches, and just to give you a sense of the magnitude of the operation trade the best but admittedly incomplete information protect at -- projects instead of good repair requirement of about $5.2 billion over the next 20 years to preserve the existing system. today, the share of real modernization is on annual basis at of about $37 million.

in a nutshell, we are representative of an important and growing slice of transit systems in the country. all, like us, or modern -- were modern, but are aging and just beginning second generation plants to the system. in a matter of speaking, we are the baby boomers of the transit industry. 20-35 years old, no more than new kid on the block, but just all too often, it seems like we looked up one day and suddenly we were middle-aged. largely operating in high-growth areas of the country like the atlanta region with continuing demand for rapid service expansion while we don't expect the same explosive growth we experienced in the '80s and '90s, another 3 million people are projected to come into the atlantic region by 2015. you find staggering concentrations of physical infrastructure rehabilitation

and replacement needs coupled with a devastating turnover of experienced personnel at all levels resulting from retirements that are understandably very -- but understandably clustered. finally, not a fully appreciate organizational steps -- organizational shift from being a building organization to operating organization. having been in the industry for 30 years, this requires a very different skill set, competency, and organizational focus. in closing, i would like to stress the point that the challenges confronting us in addressing the issue of state of good or fair are industry-wide. virtually every community and transit operating is -- operator is [unintelligible] i applaud the serious focus in this area and strongly support the expansion of the april 2009 state of good repair report to conduct an industry assessment of state of good repair beyond

the seven largest systems included in this report. it is my belief that investment coupled with real programmatic restraint, a level playing field, outcomes based, meaningful reforms metrics, strong federal oversight, in- depth technical assistance and serious incentive for local investment are key elements to the prescription needed to help us move forward. i believe that ultimately there must be consequences for those systems and communities that are not truly [unintelligible] of the federal investment. our industry is so behind in the state of good repair and class asset management and large measure, that's attributed to under investment. many transit system managers really don't know what they don't know, or more importantly, should know about the state of the repair in their system. while it is not right, human nature being what it is, all too

often they melees sets and overtime and when you continuously defer projects and don't have the funding 80 two -- funding needed to replace in the structure. before you know, it becomes ok to be ok. then after another seven, 10, 20 years, it becomes ok to simply get out the door without an obvious safety defect problem. for an industry clearly depending on big things that move, moving safely and efficiently with precision, is a glide path to mediocrity when our core servicing system expectation and standards [unintelligible] this is the real challenge that faces our industry and communities we serve in our nation. if we continue to neglect the real and systemic issue of state of good repair. at the end of the day, what is the overall transit vision and expectation?

and national transit system of first choice or one of last resort? thank you for the opportunity to share my thoughts. >> thank you very much for these very honest reflections. we will start a round of questioning with the distinguished ranking member of the full committee, senator shelby. we appreciate and being with us. i appreciate mr. catoe and dr. scott, you're mentioning our testimony about the legislation -- i know how important that is. i hope our colleagues from virginia, maryland, and georgia would join us in the process of cosponsoring legislation that would help us move along. i do know how consequential it will be if we don't get some relief therefore transit agencies across the country. mr. catoe, i know the

investigation is still going on and i don't expect you to comment about what the results will be. we will wait for results, but have you as an agency from that experience learned anything in the context of what we're talking about here that is of value to the committee and would be of value to other agencies? >> let me tell you some of the steps we have put into place. the mattress system, as i mentioned, is over 35 years old. prior to the accident, we were running various tests on our system once a month. since the accident, we run test twice a day and based on the recommendations from the national transportation safety board, we are in the process of developing a real-time detection system. that will take time to develop,

but it is under way. the other aspect of looking at the system and what we have learned, something we knew and had planned for, the need to replace cars once they exceeded certain life expectancy. the issue the ntsb discussed with us which did not cause the accident, but has an impact on the amount of impact it can be done as the crash were thinness for vehicles -- crash worthiness for vehicles -- we have talked about that today. in addition to those actions from the investigation, it is to look at the sibling systems and computer backup for that. to make sure the systems you are using are up-to-date and you are using the best possible technology. that requires an enormous amount of investment and capital dollars.

>> let me ask you -- your testimony highlights that even a successful agency, without adequately funding -- without adequate funding, performance can suffer. i think the chicago transit authority has effectively used some of the recovery act funding to deal with some of those challenges if i'm not mistaken. but if you don't get a significant increase in rail modernization in the next six years, what is the system look like? >> we have a $6.8 billion need. if we do not get a significant investment, because must always be safe and make sure the writers are safe, we would need a smaller system. as prior ship increases, that would not be the case. so we would not operate our system, whether bus or rail, our

system is smaller and does not carry the number of writers it does today. -- number of riders it does today. >> so you have to reduce services? >> we would reduce services and take buses off the street. we are heavy rail and bus and the investment we need in the rail modernization, we need to put save us a quick and on the street to reduce the number of routes -- that would reduce the number of routes we serve and would reduce either the frequency or had way of the trains as they continue to age and we can replace them, we would have to increase the headways on the rail system because we would have to operate your trains. >> mr. sarles, in much of your testimony, you have a caveat and i would like to dwell on that caveat. you allude to the fact you are worried about too much federal oversight of how agencies keep themselves in a state of good repair.

my question to you is do you oppose any requirement to report the state of repair information? where are the bounds? i know you all want money from the federal government, appropriately so. but it seems to me we have responsibilities for safety, so what is the right balance? >> we're happy to provide all the information we have on the condition of our system. what concerns me is when i hear discussions of decision of rhythms which means that you take the informations and -- decision algorithms, which means you take the decision and animation and spits out the most important priorities. that type of decision making needs to be made by the transit authority, in our case at least, by the engineers and maintenance and operating people know the system best and can decide where we go first in terms of spending

money and providing an formation, where -- in terms of providing information, we're happy to provide it. >> i am not a bigot algorithm guy. we depend on them to hope for -- i am not a big algorithm died. my personal view is there is a need for the fta to have a sense of what a state of good repair is and what the inflation is to make informed policy decisions and allocations as well. to some extent we can get together and work with the added a trader -- work with the administrator, is very important. >> and we will work with them. >> senator shelby. >> i was not here when the administrator was here, but i have a number of questions i would like to submit for the record.

to all the panelists -- have we added to the overall problem by allowing systems to continue to expand and grow without regard to their ability to maintain what they have? i know is a mixed bag, but if you don't grow, he can finish the system. i know that. but at the same time, maintenance and safety is so important, is it not? >> i would like to note that even the aging systems continue to grow because of demand for ridership. the more people we can move to public transportation, the better. i think growth is good and we need continued investment in the system as well. there is not a public transportation system in the world that is not subsidized by

the government. i think the investment needs to be increased so we can encourage people out of their cars for a cleaner, safer environment and on to public transportation. this is to be for all systems that are middle-aged. we are senior citizens, on our last breath, we need health -- need help. but for middle-age systems, it's important as well. >> but whatever systems we operate, they have to be operated safely. they're moving people with as much speed as we can put together. >> if i could respond a little bit to the question. in my testimony, i talked about the balance. sometimes it is not as pretty to come to a repair of a rail line, but it is absolutely critical.

there needs to be a balance of a state of good repair and maintenance of an existing system but, as we observe from the country, specifically here in washington dc, our system assumed it would carry 300,000- 400,000 people. it now carries in excess of 800,000 people. in the case of the inauguration, 1.5 million people. there has to be a balance of safety and the state of good repair and the money, when necessary, to expand capacity. that is what i support as part of the position this group is taking in its testimony. all that relates to safety. the state of repair means that you have a safe system. >> i would echo those comments. it is an issue of balance. balance and additional funding.

we have another 150 million people that will be added to the system in the next 40 years, so we have to do expansion. at the same time, we cannot let that go at the risk of not running safe systems. the challenge that faces us is that we have to significantly increase the funding on both ends of the spectrum for a set of good repair as well as expansion. alternately, i would call a more with a velvet hand, we have gotten ourselves into this quagmire and we have to have an immediate infusion that is focused on the issue of state of the repair. i understand we got what we got and then ultimately, federal funding decisions in terms of expansion to the least being able to show a modicum in terms of which got in terms of satisfactory use of that investment. i would be supportive of that.

but we are in the mess we are now, candidly, putting a hammer down and saying there will not be any growth until we wind up taking place of that would be shortsighted on all our parts. >> i just want to go back to a little bit of what i said earlier. our first priority has been a state of good repair. we took a system that was totally disinvestment in part of the last century and created one that is in a state of good repair. we always look to spend money first on a state of the repair. but when we look at capacity expansion, one that we are required to do is demonstrate to the fta that not only could we take care of the capacity expansion, but that we have the money to maintain a state of the repair for the existing system. >> is the primary problem lack of funds? the lack of planning? all that?

>> thank you. the first thing is a lack of sufficient funds. there is funding, but the needs are grading -- the needs are greater than the amount of funding. if you look at the historical perspective and we talk about balance, we could probably look back and say maybe we did not have the proper balance of expansion and maintenance of the system. overtime, the amount of dollars for maintenance crew at a higher rate than -- grew at a higher rate than what had been allocated under the federal program. from planning perspective, that needs to be part of the knicks going forward whenever there is appropriations for a new start that we need to build in the formula, what it cost to maintain the system over the next decade or century. >> i would just add that in the

case of cpa, our funding problems are also operational. as we try to straddle the operational funding shortfall, we tend to use capital dollars for preventative meighen's which exacerbates our capital needs. -- preventative measures which exacerbates our capital needs. >> your ridership is 800,000? >> it averages slightly under 769,000. we have had the 25 highest -- >> how much money does that bring in per year? >> roughly about four hundred billion dollars. we recover about 80% of the operating costs.

>> so you recover 80% through the cash flow. >> through the fares. operating costs, not capital costs. >> is that basically what the others do more or less? >> i think it is the second- highest in the country. >> i am at a 20% recovery and with rail, about 35%. >> new jersey, overall we are between 45% and 50%. buses are a little bit lower. >> we are roughly 50% this year. [unintelligible] >> is my understanding federal transit administration does not currently defined state of the repair. do you believe there should be a uniform definition for a state of good repair and should be specific measures and

requirements tied to such a definition? is that right? the state of good repair is not defined? >> i don't mind responding. i think there are various definitions in the industry for state of good repair. what we need to do, working with the federal transit administration, is to ensure we have the same definition and the same measurements in place to ensure the systems are there. the answer to your question is i support a common definition and common standard of measurement throughout the industry to determine status of the repair. >> part of the problem has

definitely been under investment. the other issue is that we are all over the map in terms of structure on state of the repair. what that means, having the appropriate for nation and tools, there is rigor required in that area. i join with my colleague, i don't want to wind up seeing something that becomes a cookie cutter that spits out numbers and all the sudden -- but some discipline is required. >> thank you. thank you for holding the hearings. >> i want to follow up with a couple of last questions before we start this series of votes. we have been fortunate that we got all this testimony before the votes start. senator shelby raises a good question. correct me if i'm wrong, but should not be considering one we are extending service as opposed to capacity to maintain in good

condition the existing service we have? that is a challenge to agencies. if there is a demand for greater service and you not meet the demand, there is the flip side of a consequence to that. obviously, ridership goes somewhere else and the farebox goes down. that has a consequential effect. is that a fair assessment? >> if you don't provide it quality service and enhance capacity, the writer should will drop. -- v. ridership will drop. as i commented, i support the concept of if you are going to build a system you have planned for the made into the system, [unintelligible]

there are provisions set aside to do that. that's one of the issues from the process of looking at the reauthorization of the authorization bill. how is an expert? >> if you get 80% back of your operating costs in your case, which means used to live a 20% shortfall, what you get on your capital costs? >> from the fare box recovery standpoint, there is a zero on capital. that's local level as the federal government. >> the bottom line is that even one of the most highly efficient operations -- operating systems as a 20% shortfall in its operating budget. it's that thing in terms of its ridership as relates to capital needs. this is a fundamental reality of mass-transit system. our colleagues in congress have to understand that, as one of

the fundamental issues in whether or not you want and effective mass transit system. my other point is that, in my view, as someone who previously, before coming to the senate, represented a congressional district that was right across from midtown manhattan. on that fateful day, september 11, came to a very hard way of understanding that in a post- september 11 world, having multiple modes of transportation is critical for national security. on that particular day, when the train stopped, when the bridges were closed, when the tunnel for closed, having another form of transportation, in that case was faeries, bringing people out of

downtown manhattan to get treatment in new jersey. while that is different than the type of transit we're talking about now, it highlighted the importance of a post-september 11 world where multiple modes of transportation, in addition to getting to a place for job and economic opportunity, in addition to improving the quality of life we have as far as sitting in traffic less time and having more quality time with families. in addition to prove -- in addition to improving the air we breathe where respiratory ailments are still too high in this country, in addition to environmental issues, and the addition to planning it in a way you can create bases around transportation systems through transit villages, there is a security component to this. when something happens, god forbid, and i hope it never happens again, that is why we

work every day to make sure that, but if it were to happen, we need multiple modes of transportation to get people out of the area of incidents into a place of safety. that's another component we lose sight of along the way. with that, thank you to all of you for your testimony. the record is going to remain open for one week to allow senators the chance to ask follow-up questions in writing. for those of you who received questions, we ask you to respond to them as promptly as possible. thank you for the dissipating and helping the committee prepare for the upcoming reauthorization legislation. with that, the hearing is adjourned.

a bill that gave the food and drug administration long overdue authority to regulate medical devices. in support of that bill, senator kennedy said at the time i quote, today, the medical device industry plays a prominent role at the very heart of american medicine. many devices today are actually used to sustain life. we will grow more and more dependent upon medical devices in the future. we stand to benefit a great deal from them but we must be sure that they are safe and effective in order to avoid needless injury and death. end quote. today, this committee will hear testimony on precisely the issue that senator kennedy sought to address, the need to ensure that the medical devices that patients rely on to stay healthy and in many cases, alive, are safe and effective. we are here because last year in

a supreme court case regal versus medtronic, inc. the court held the medical device, whose express purpose was to provide for the safety and effectiveness of medical devices, end quote, the court said that this law preempts state tort claims when a medical device causes harm. this means complete immunity from lawsuits for corporations that endanger consumers with unsafe devices. the upshot is that a negligent corporation cannot be held accountable and victims could not receive fair compensation and thus, consumers are at risk. unfortunately, this had catastrophic consequences for ordinary americans. take the example of avery de growe of mchenry, illinois. she was born with a hereditary heart defect that put her at risk. when she was only 2 years old, her doctor recommended she have a defibrillator implanted in her chest. at age 3, she was playing in her

basement when the defibrillator shocked her nine times. when her mother picked her up she felt electric shocks through her daughter's body. avery's parents had the faulty defibrillator replaced but medtronic told them the company would not cover the cost. avery's parents are still struggling to pay off the medical bills. i am told avery is here in the audience today. is avery here today? hi, avery. good to see you. i like the daisy you have in your hair, by the way. consider judd orcott of oregon, during his national guard service, he was -- sustained a spinal cord injury. in an effort to reduce pain, he had his herniated disc replaced with an artificial disc manufactured by dupuis spine. instead of experiencing relief from the artificial disc, judd experienced extreme pain and bouts of paralysis. however, because of the court's ruling in regal, judd has no

recourse to seek remedies for his injuries. today, we'll hear from an iowan who received 22 electric shocks within a span of 53 minutes from a faulty medtronic defibrillator. because of the faulty device, he suffered enormous pain, was forced into early retirement and is unable to perform basic functions such as even driving on the interstate. we'll be hearing him testify here today. as a senior member of this committee i have worked hard along with others here, senator hatch and others, to ensure that the fda performs its job well. while the fda approval of medical devices is important, it cannot be the sole protection for consumers. i say that because fda approval is simply inadequate to replace the long-standing safety incentives and consumer protections provided by long-standing state tort law. no matter how diligently and effectively the fda does its job, it simply cannot guarantee that no defective, dangerous and deadly medical device will reach

consumers. as the former director of the fda center for devices and radiological health frankly acknowledged, he said quote, the fda's system of approval devices isn't perfect and unexpected problems do arise. last year, 15 devices were recalled due to defects. in 2009, there have already been ten. the fact is the fda conducts the approval process with minimal resources, and simply does not have adequate funds to generally assure that devices are safe or to properly and effectively re-evaluate approvals as new information becomes available. moreover, the fda relies on manufacturers to provide information about their products. once on the market, the fda relies on manufacturers to track devices and monitor for problems. however, without the threat of any liability, there is little incentive for manufacturers to report problems to the fda or to the public. this puts thousands of consumers at risk of harm.

indeed, thousands have already been harmed in instances where manufacturers knew of problems with the device, but withheld that information from the patients. in our system of justice, access to the court system is critical to exposing dangers and bringing about remedies. through discovery, litigation can help uncover previously unavailable information on adverse effects of products that might not have been caught during the regulatory process. litigants can demand documents and information on product risks that might not have been shared with the fda. in this way, the public as a whole is alerted to dangers in these medical products. finally, preserving people's ability to sue when injured provides a very powerful incentive to manufacturers to use the utmost care. in short, the threat of liability is the safety net that helps repair problems when the fda or manufacturers fail to warn consumers properly.

as the supreme court noted in another case concerning drug companies, the wyeth versus levine case, state tort suits uncover unknown drug hazards and provide incentives for drug manufacturers to disclose safety risks promptly. i ask, why would we not hold device manufacturers to that same standard as we hold drug companies? i think sadly, the supreme court fundamentally misread congress' intent in passing the medical device amendments in 1976. the court's ruling however is not the final say on this matter and to quote chief justice roberts, in every area involving an interpretation of a statute, the final say is not with the supreme court. the final say is with congress. and if they don't like the supreme court's interpretation of it, they can change it. end quote. i might just at parenthetically aaside, we found that with the

americans with disabilities act. when the supreme court in three cases narrowed the scope of the americans with disabilities act. in clear contradiction of what we put in our report language. when we pass a bill, we don't put in every little single thing. we add report language to try to give guidance as to what congress' intent is. well, the supreme court just threw that overboard. they didn't pay attention to it and so we had to offer the americans with disabilities act amendments two years ago, it took us about a year to get them through and the order got through last year and president bush signed them into law. which we then overturned the supreme court's decisions to fully enlighten them as to what congress really wanted to do. so this is something that is not unheard of. senator kennedy as he did 30 years ago, is fighting to ensure that consumers are safe. he has introduced a medical device safety act, s.r. 512, which would reverse the regal decision.

this bill is really about real people who have been led -- let down sometimes catastrophically. they have no way to hold those who harm them accountable. i would yield to our ranking member, senator hatch. >> thank you, senator harkin. we appreciate the leadership you provide and miss our friend, senator kennedy. we welcome all of you witnesses here today. this is a very important hearing and this is a very important subject or should i say, set of subjects. mr. chairman, i want to start off by discussing the context in which we are holding today's hearing. as everyone in this room knows, congress is in the middle of debating and drafting legislation aimed at overhauling our nation's health care delivery system. obviously, we are somewhat divided over what is the best approach in this effort but i think we all want to see something done to reduce the health care costs in this country. as we all know, the medical device amendments of 1976, the mda we call it, established

rigorous system of federal oversight of medical devices. under this system, devices carrying the greatest health risks are subject to premarket approval by the fda. during this process, fda officials spend a tremendous amount of labor intensive time and hours reviewing a single device, consulting outside experts and analyzing the safety and effectiveness profile associated with the use of the device. i'm sure our panel will discuss this process in more detail so i'll just say that the fda's premarket approval process for medical devices is extremely rigorous and very costly to the manufacturers, and really, to those who hope for the benefits that can come from these medical devices, and as history has shown, the fda is exceptionally efficient. in addition to requiring premarket approval, the mda also requires those who manufacture and market the applicable devices to report to the fda on the implementation and use of all approved devices.

these reports include any new and relevant clinical ká in addition to these rigorous approval and oversight requirements, the mda included an explicit preemption provision prohibiting states from establishing or continuing quote, any requirement, unquote, which quote, is different from or in addition to, unquote, any federal requirement applicable to the device or which quote, relates to the safety or effectiveness of the device, unquote. this provision was common sense, given the rigorous and costly

nature of the fda approval process, it was in the best interests of all shareholders, excuse me, stake holders, including patients and consumers, that the states be prevented from supplanting this system with their own regimes. as we're all aware in last year's regal versus medtronic decision that my distinguished friend has mentioned, the supreme court held that this explicit preemption provision also applied to tort claims filed pursuant to state common law. this is not a surprise move by the court. it was an 8-1 decision that affirmed the position taken by the overwhelming majority of the circuit courts. yet i have to say the personal injury lawyers and their allies in congress have painted this decision as an unexpected change in the law in order to advance their pre-existing agenda to weaken federal preemption. the result of this effort is the medical device safety act. the legislation we're discussing today would alter the mda's preemption provision to state

that it does not apply to actions for liability under state law. now, my opposition to this approach stems from many factors. first, i do not believe that randomly selected jurors have the necessary scientific and clinical knowledge to perform the same level analysis -- and analysis as the review -- as the analysis and review by the experts at the fda. yet in essence, this legislation would supplant the findings of the fda with those of juries in state courts. this is not only bad policy from the perspective of device safety, it will also likely have a number of unintended consequences. once again, under the current system, device manufacturers go to considerable expense to obtain premarket approval, in part because they know that the financial risks of litigation are greatly reduced once the process is completed. however, if this legislation is enacted and manufacturers are

required to ensure that they have approval of the fda as well as that of any 12 random people in any one of the states, the risks of marketing a device will greatly increase, and the cost of these devices will go even higher. as a result, innovation will be stifled and fewer and fewer devices will be brought to the marketplace. additionally, we will inevitably see a rise in the overall cost for devices as a means to offset the cost to more frivolous lawsuits. as someone who tried these suits in the past, in my early legal career, or service, i have to say a high percentage of the lawsuits were brought to get defense costs. they were frivolous suits. they have been running up the cost of health care in our society beyond belief, and frankly, when there are legitimate lawsuits, there ought to be ways of being able to arrive at just compensation for those who have been injured.

but most often or not, and since the costs of defense, i generally think of them as between $50,000 and $200,000, you know, it's many times in the interest of the people to just pay the cost of defense rather than to defend the cases and take a chance with a runaway jury. now, this is not only a detriment to health care reform but not only will this adversely affect an industry that employs millions of people during a time of economic crisis, it would also harm patients as they will not benefit from the ingenuity and continuing advancement in technology we currently are benefiting from, the vast majority. that in my opinion will be the most devastating effect of this legislation. indeed, we have one of the most if not the most innovative and

vibrant medical device industries in the world that provides life-saving solutions to millions of americans ask people all around the world every year. at a time when our unemployment is rapidly headed towards double digits, it would be a mistake for us to take some of the steps that are currently being discussed which include, on top of this legislation, taking billions out of the productive sector that employs thousands of americans to produce life-saving treatments to pay for an ill-advised massive government expansion and control of our health care system. making this proposition even worse is the fact that it's unnecessary. we all want to ensure that those who have been truly victimized by the negligence of another party are able to receive adequate compensation for their injuries. however, the current system, including the statutory preemption, does not prevent plaintiffs who have legitimate claims from being compensated. under the mda device manufacturers can only benefit from the protections of preemption if they followed the

system to the letter. if they withhold or falsify information in their disclosures to the fda they will be charged with defrauding the federal government. similarly if a single device is not built exactly to approved specifications or doesn't include fda-approved labels the manufacturer will be liable for damages. in addition, if a device is improperly planted or used the mda will not protect a doctor from being sued for malpractice. when a manufacturer is legitimately at fault, they will be liable under current law. when they are not at fault the mda provides a narrowly crafted safe haven from costly litigation. as stated this exceptionally narrow exemption has great benefits. the mda has allowed unparalleled advancement in medical device technology. due in no small part to the fact that the rules for safety and liability can't be rewritten in 50 different separate jurisdictions.

if an acted the legislation we're discussing today would remove this protection and as a result, i believe it is the patients who are going to suffer. i look forward to hearing the testimony from our panel today and i hope that during this discussion, we can get to the bottom of some of these issues. in particular, i'd like to hear some explanation as to why we should empower laymen on state juries to overrule the studies, analysis, and findings of our fda experts. in addition, i hope we can debate these issues looking toward the future and the effects this legislation will have on the advancement of medical technology. the increased costs to our already out of control health care spending and the lives of those who were benefit from such technology. let me just say that we're happy to have all of you here today. each of you has important testimony to give to us. we're grateful you take time to be here. i particularly want to mention mr. hunt, who is in my opinion the dean of all fda lawyers, who really understands this business as well if not better than anybody in america today.

peter, we're very happy to have you here and we appreciate you taking time for what we know is a busy schedule to come and help us work through there and understand this better. but i've known you for all of my 33 years in the united states senate. you're totally honest, a decent man. you also have written textbooks and have been literally the dean for all of us in trying to understand all the intricacies of the fda. particularly appreciate my friend up here, senator harkin. he and i have worked very closely together, not only on medical devices, i've worked very closely with the chairman, senator kennedy. we worked on all kinds of other things, including the americans with disabilities act. we managed that bill on the floor, the two of us, and i remember when we walked out and saw all those folks who were just praying that we'd get that bill through, we both broke down in tears as did all of them. so i want to thank senator

harkin for chairing this hearing in the absence of our esteemed chairman of the committee. i again want to thank all of our witnesses for appearing and being with us today. thanks, mr. chairman. >> thank you very much, senator hatch. and we'll now go to -- i'm told we've got a couple of votes coming up here very soon. what we'll try to do is go down the panel, and if you'd just take maybe five minutes to summarize, then when we break to go vote, we'll come back for questions and finishing up the panel. i just don't know exactly how soon those votes are going to be called -- maybe right now. i want to note for the record we have a new member of our committee with us today. their the first hearing of our distinguished senator from the state of minnesota. we welcome you to the committee. >> thank you. >> i want to say i started and that seat right down there, i remember back in the last century. >> the way he used to beat me up on television, i'm happy to see him way over there.

>> it's great to serve with both of you. we welcome you, mr. change. you too, mr. first, start from my left, go to the right, over this way. first we'll start with dr. myzell, founder and director of the medical device safety institute at beth israel deaconist medical center. assistant professor of medicine at harvard medical center. he has an active cardiology practice and directs the pacemaker and defibrillator service at beth israel deaconist medical center. received his md from cornell university, his mph from harvard school of public health, completed internal medicine in cardiovascular training at brigham hospital. and is the former chairman of the fda's circulatory system medical device advisory panel. dr. myzell, welcome. as for you and all witnesses your statements will be made

part of the record in their entirety. if you could sum it up in five to seven minutes, i'd be most appreciative. >> thank you, mr. chairman, committee members. good afternoon. thank you very much for the opportunity today to speak about the importance of the medical device safety act of 2009. i am a practicing cardiologist at beth israel deaconess medical center. i direct the medical device safety institute, an independent industry independent ant, nonprofit organization dedicated to improving the safety of medical devices. i served as consultant to fda center for devices in radiologic health since 2003 and previously chaired the fda's poe-market and heart device advisory panels. i hope that you will appreciate that fda marketing clearance or approval of a medical device does not guarantee its safety. in particular, manufacturers' responsibilities for product safety extend well beyond

initial fda approval. the u.s. supreme court's regal decision eliminates an important consumer safeguard, the threat of manufacturer liability, and will lead to less safe medical devices and an increased number of patient injuries. we are very fortunate to have the preeminent regulatory system in the world. the u.s. food and drug administration regulates more than 100,000 different medical devices manufactured by more than 15,000 companies. they receive several thousand new and supplemental device applications annually, and they are mandated by congress to complete their premarket evaluations in a timely fashion. thankfully, there are many superb fda engineers, physicians, scientists and public servants who work tirelessly to try to ensure that only safe and effective medical devices reach the american public. unfortunately, it is not uncommon for unanswered questions regarding device safety and effectiveness to remain at the time of fda approval. this creates the potential for a large number of patients to be

rapidly exposed to a newly approved product in the absence of long-term follow-up data. for example, close to 268,000 patients had been immigranted with the medtronics defibrillator before it was recalled in october 2007. we'll hear more on that later. it was then determine the wire was prone to fracture and a fracture of the lead which connects the implantable defibrillator to the heart may result in serious health consequences, including painful electric shocks or death. the medtronic lead was approved on the basis of no human clinical data. although medtronic began receiving reports within months of release, they did not recall the lead until more than three years later. an fda inspection report issued after the recall cited medtronic for "objectionable conditions" noticing they failed to implement appropriate corrective and preventive action procedures related to the company's investigation of the product

anomalies. in addition, when the fda inspection team requested certain documents according to the fda inspection report, medtronic would not let the fda team view them. the delay in issuing a product recall, the fda citation, and failure to provide fda with requested documents did nothing to eliminate medtronic's protection under the preemption doctrine. medtronic claimed immunity citing the supreme court regal decision and the u.s. district court agreed. the fda annually receives reports of more than 200,000 device-related injuries and malfunctions and more than 2,000 device-relate the deaths. it's challenging for the agency to identify patterns of device malfunction among the deluge of reports. the vast majority of recalls are initiated by the manufacturer but manufacturers have an inherent financial conflict of interest often measured in billions of dollars. in numerous cases manufacturers have knowingly sold potentially

defective devices without public disclosure. during fiscal year 2006 alone, 651 recall actions were initiated involving 1,550 products reminding us fda product approval does not ensure device reliability or performance. it is clear that medical device manufacturers have responsibilities that extend far beyond fda approval and that comes have failed to meet their obligations. yet the u.s. supreme court ruled in their regal decision that manufacturers could not be sued under state law by patients harmed by product defects from fda-approved medical devices. as a result, consumers are unable to seek compensation from manufacturers for their injuries, lost wages or health expenses. more importantly, a vital consumer safeguard, the threat of manufacturer liability, has been eliminated. implanted medical devices have enriched and extended the lives of countless people but device malfunctions have become modern diseases that will continue to occur. manufacturers have important responsibilities for product

safety that extend well beyond fda approval. the idea that manufacture liability for a medical device should end at fda approval is a dangerous policy. additional consumer protections is offered by the medical guys safety act of 2009 are essential to minimize adverse health consequences and to improve the safety of medical devices for the millions of patients who enjoy their benefits. thank you. >> thank you very much, dr. maisel. now we'll turn to professor thomas mcgarity who holds the long-endowed chair in administrative law at university of texas school of law. he has taught administrative law, environmental law and torts at texas law school since 1980. professor mcgarity received his ba in 1971 from rice university, his jd in 1974 from university of texas. after a clerkship with the honorable william e doyle of the tenth circuit court of appeals, he served as attorney vizner the office of general counsel of the

epa. professor mcgarity has written extensively about administrative law and published "the preemption war: when federal bureaucracies trump local juries." professor mcgarity, welcome. >> thank you very much, chairman and members of the committee. i'm happy to be here. i am very pleased to be here and to share my thoughts on this very important bill with you. i am, of course, expressing my own views on this matter, not those of the university of texas. the supreme court has frequently invoked what it calls the presumption against preemption in areas that are subject to traditional state regulation. and this reflects our federalist system where we have a federal government but we also have 50 state governments. medical devices were not regulated at the federal level

at all until 1976, when the shield tragedy motivated congress to enact the mda of '76. the purpose of the statute was to protect the users of devices to ensure they did not enter the market in the first place. the medical device amendments did have and do have a preemption clause in them. it does use the magic word "requirement" as the supreme court held in the regal opinion. that was no doubt added to the statute because several states were enacting their own regulatory regimes in the absence of a federal regime to fill the void. it is -- the statute lacked a savings clause for common law claims, no doubt because in 1976, it never occurred to

anyone that the word "requirement" would include state common law, but supreme court in 1992 held that it did for purposes of that statute. and we've seen in the regal case that it now has interpreted the preemption clause in the mda to mean the same thing. now, while the courts' reasoning is open to criticism, the point that you made earlier is that congress is in the position to fix this. congress is in the position -- is the ultimate decisionmaker when it comes to preemption. and i think, therefore, that taking up s-540 is a good idea for the reason that it preserves corrective justice for those who have been wronged. corrective justice is a bedrock principle of civil society that goes back at least as far as aristotle. the compensation of the common law provides corrective justice

by requiring manufacturers of definitely designed or manufactured products to compensate innocent victims. now, tort law also provides an important back stop to the regulatory system by sending a message to potential defendants to collect the data necessary to evaluate their products and to take action to prevent future harm. device manufacturers that conduct the clinical trials that are continually receiving the reports and to collect data from all sources are in a much better position than the doctors out in the field, than the patients certainly, or even the fda, to evaluate the safety of their devices. they're also in a far better position to do something about it once problems do arise. the manufacturers' incentive to comply with the common law duty reinforces, therefore, the protective function of the medical device amendments.

now, what are the consequences of preemption? well, on very rare occasions congress has, in fact, explicitly preempted common law claims. every time it's done that that i'm aware of, it has provided either a federal cause of action or some compensation regime to provide that important compensation function. when a court interprets the word "requirement" to preempt state common law claims, there's a void left. there is no corrective justice. it also robs the common law of its back stop role to back up the federal system, the regulatory system. now, there are other policy considerations as well. institutional confidence. yes, fda has expertise but it is also subject to capture. and fda approval is still relevant and often determinative. i would say most often determinative in common law litigation.

fda has traditionally lacked resources. it can be manipulated by companies who defraud the agency. it is not the case that a party who has alleged that he's been damaged because a company's defrauded the agency is entitled to compensation for that. indeed, the supreme court in the buckman case held that that claim is preempted. by federal law. so whereas the federal government may pursue the frauds, or fraudulent practices, it is not something that a defendant -- a plaintiff who has been harmed can seek compensation for. we have other functions. federalism, as already mentioned, an important consideration in our government. and the argument that somehow allowing compensation will overdeter companies just isn't

supported by hard, empirical data. i looked in -- i can't find good, strong studies saying that, well, yes, we have fewer devices out there, fewer drugs for that matter, because people are able to claim compensation when they are damaged. the decision to preempt common law is uniquely within the power of congress. i commend the committee for taking up that question. thank you. >> thank you, professor mcgarity. now we'll turn to michael m the lahill, graduate of iowa state university, the foremost university in the entire universe. after graduation worked as a golf course superintendent for 13 years. for the next 28 years worked for a turf equipment distributor designing and selling golf course irrigation systems. mr. mulvehill is the victim of a

faulty medical device and will speak to that experience. thank you for being here. >> i had a medtronics fib regulator implanted in march 2006. arrythmia was my problem. june 30th, 2007, i had a very painful, life-changing episode. my wife and i were driving to see our son, daughter-in-law and grandchildren in haddenfield, new jersey. on that saturday morning i was driving east of springfield, ohio, on i-70, in a construction zone, when the device went off. first thought we hit road debris but could not understand what the blue flash was that i'd seen. i tried to navigate the car toward the shoulder of the road. the device shocked me again and

again. mary, my wife, was calling 911. i don't remember how many times that device went off. all i recall is the excruciating pain and the fear i was feeling. responders showed up and took me to a small hospital in london, ohio. they rolled me in on a gurney. the device went off again. i'd moved my head. it lifted me up off that gurney and dropped me right back down on it. i remember looking at what i was assuming a very experienced nurse. her eyes were really, really wide open with concern. and my wife, because i was screaming so bad, she had to go outside, she told me later. i talked to ross hart institute at ohio state, put a big magnet on me, transported me into columbus to that hospital. checked in at the ross heart institute. i was exhausted. very scared. and i hurt. medtronics rep came into the

room and read the device. told us it shocked me 22 times in 53 minutes. he added that it was an electrical problem, electrical wire lead problem. not the device. # we had several doctors come in later that day and came into the room. one of them told my wife and i how lucky we were that i had not wrecked the car, because i had been driving. the lead replacement surgery for scheduled for monday, july 2nd, early afternoon. i was admitted for three days from saturday to tuesday, and i was discharged around noon on july the 3rd. mary drove us on to our son's house and the entire way back to our house in bettendorf. after this episode i found driving on freeways, highways, interstates, made me very anxious, made me very tense and fearful of the device going off. i was afraid i might wreck some

other car, hit somebody, kill myself, et cetera. this anxiety had a huge impact on me and my job. i'd been a golf irrigation specialist for the distributor that covered 77 counties in iowa, 17 in illinois, three in wisconsin. that's a lot of driving. i was no longer able to properly do my job due to anxiety, fear that i suffered any time i drove any distances on highways. it also affected my personal life, this inability to drive. i had annual fishing trips planned for the fall of 2007. they were both impacted. the first trip was to deer river, minnesota. one of my fishing buddies drove the whole way up there and back, about 1,200 miles round trip. while in deer river, i experienced some chest pains, i thought. i went to an emergency room.

the doctor concluded i was likely suffering from ulcers. on returning home, my doctor located the ulcers and placed me on antacid medication, et cetera. about a month after that, october '07, was the next fishing trip. again, one of the fellows on the trip was kind enough to do all the driving. i was able to stay up there a day and a half out of the nine-day trip. the anxiety, nerves, whatever you want to call it, fear got to me. the same fellow drove me home 380 miles from here. then went back up to finish his vacation. it's affected our personal life too. mary and i can't take those trips to see the family and friends. it limited mary's travels. since i worry her more, she's not there to calm me down. after all this worry, deposition, anxiety i was feeling i decided i needed professional help and i began seeing a psychologist who taught me relaxation techniques. they seemed to help calm me

down. i also at that time decided the travels and pressures of my sales job were too much to handle so i moved my retirement up to january 3rd of 2008. about a year and a half sooner than i'd planned. i had several device checks in '08, three trips to the e.r. within six months of the lead replacement. majority of these visits were from me feeling that something was not right. one of my biggest questions at this time is, what effect the numerous shocks from the medtronic device had had on my heart. any unexpected twinge or unusual feeling in the chest area makes me tense, and i begin to wonder if the device is working properly or whether i need to go to the hospital. it's not a fun way to live. my hope is that no one else ever has to go through the pain and agony that i experienced with the fractured lead and that medtronic is held responsible for the injuries it has caused other patients like me.

thank you. >> thank you very much for a very profound statement, mr. @@ mr. hutt, welcome to the committee. please proceed. >> thank you, mr. chairman. i appear before you today at the invitation of the committee to present my own personal views on section 521 of the federal food, drug and cosmetic act which provides for national uniformity in the regulation of medical

devices. section 521 was enacted, of course, as part of the medical device amendment of 1976. as i relayed in think prepared statement, the medical device amendments of 1976 and specifically section 721 were enacted or developed during my tenure as chief counsel for fda, and i was deeply involved in their development. the medical device bills that were forwarded to congress by president nixon in 1971 and 1973 contained no provision that related to the effect of the law or proposed law on state law. in august 1973, however, representative paul g. rogers, democratic member of congress

from florida, who was chair of the house subcommittee on public health and environment, introduced medical device legislation that for the first time included a national uniformity provision. on behalf of fda i strongly supported national uniformity in the requirements for medical device regulation, because it would strengthen the integrity, the credibility, and the primary jurisdiction of the agency. from then on, all medical device legislation considered in both the house and the senate included some form of national uniformity requirement. the final version was enacted as section 521, and it is that provision that would be amended by the legislation you are considering today that would permit product liability decisions by judges and juries that are inconsistent with fda

decisions. mr. chairman, because of the time constraint, i will summarize my testimony with seven brief points. first, s-540 applies only to devices that are determined by fda to be safe and effective under the rigorous premarket approval system. we call these premarket approval or pma devices. s-540 does not apply to devices that go through the simplified section 510-k procedures. second, pma devices are the life-saving and life-sustaining devices that represent the cutting edge of modern science. they are, for example, stents to keep arteries open. they are artificial hearts to keep people alive while they can get a real heart. they are the innovative new

technology that should be encouraged, not hindered or discouraged. third, these pma devices represent only a small fraction of all medical devices. since 1976, only about .05% of all medical devices have gone through the rigorous pma devices. the supreme court determined that the other 99.5% that go through the simplified 510-k process are not entitled to national uniformity. and thus, this legislation does not affect those. fourth, the pma devices uniquely require highly sophisticated judgment on safety and effectiveness, as senator hatch has pointed out. the mds and ph.d.s that fda spend more than 1,000 hours,

over more than a year, to review each one of these devices. no one can possibly argue that lay judges and juries can do a better job. fifth, allowing judges and juries to second-guess fda divisions on pma devices strikes at the very heart of the pma system. if judges and juries can ignore fda, why can't doctors, hospitals, and patients? and even companies ignore fda? s-540 fosters distrust and disrespect for fda decisions and undermines the public health protection that the pma system is intended to provide. sixth, product liability awards punish companies. there's no question about that. but they do not in any way contribute to safer or more

effective pma devices. it is the inevitable adverse events that we know will always occur with a device that lead fda and companies to correct deficiencies and improve the device. but by the time a lawsuit is brought and completed, the problem has been corrected and the safety issue has been resolved to the extent that it can be. if it's not inherent in the device. finally, i fully support compensation of people injured by pma devices. there's no question about that. but the solution is not to farm out fda decisions to juries throughout the country. the answer is not to replace national uniformity with national inconsistency and regulatory chaos. the jury system is nothing short of a lottery.

some plaintiffs win big, others come away with nothing. it is an inherently unfair system. the goal of providing compensation can most fairly and comprehensively be addressed by a statutory procedure like the national childhood vaccine injury act of 1986. under that system, unlike the product liability system, all patients injured by a pma device would be fairly compensated. and not just those who are fortunate to find a persuasive trial attorney and a sympathetic judge and jury. thank you, sir. >> thank you very much, mr. hutt. and now we go to michael roman. michael roman is from kirkwood,

missouri. that's not too far from iowa. >> no, sir. >> he's a formula one racer. he's here to discuss his experience with a medical device that's enabled him to continue racing. welcome. >> thank you, mr. chairman. as well as members of the committee. my wife susie and i come here today with a simple story to share with the committee. a story of help, hope and heroes. in 1994 while working in a hospital in st. louis, missouri, i had a knee arthro copy done to repair a torn meniscus and developed a staph infection. my nightmare began that day as well as any family's. i've endured 28 weeks of iv antibiotics are 33 surgeries, three progressive amputations to try to save the leg, and the leg is now gone completely at the hip. i immediately began to experience phantom limb pain. they were so severe i could only make it through the day with really increasingly large doses of medications.

medications like vicadin, oxycontin, morphine. medicines that left me with only a hazy recollection of the last decade of my life. it was during that time that i sought out any and all treatment options to control my pain. these included a radiation, injections, implantable drug pumps. in 2000 we even tried a spinal cord stimulater. it's a device that electrically stimulates the spinal cord to disrupt those pain signals as they travel to the brain. the spinal cord stimulater we tried was based off of old pacemaker technology. and honestly, it was worse than the problem it was designed to treat. it replaced one type of pain with a new one that was far worse for me and my family. so back on the meds we went. finally, in 2005, i tried a new type of spinal cord stimulater. this one did manage to provide me with some relief. and hope for recovery.

the precision plus spinal cord stimulater. this is designed off of technology that is from the cochlear implant, designed to help people hear again. this system allows me to manage my pain no matter what my activity level is. if i'm watching tv or relaxing, or on the salt flats in beautiful utah trying to set a new record. once i got the device, the first thing we as a family did was, i need to get off the pain medicines. that's what we slowly started to do. i slowly started to get my life back. because i got it back, my wife susie is with me today. you know, in addition to our racing we travel all over the country and speak to pain patients and doctors about the treatment options that are out there. and it was as a result of these experiences is what allowed us to accept your invitation to be here today to talk about this. i think it's a very important issue. and during these, we've talked to many of our veterans coming

back from conflicts in iraq and afghanistan. i do know how hard it is to seek out treatments and how scary it can be. and the technology i had implanted in 2005 was absolutely cutting-edge technology. was it risky? it was. did i understand that the technology may not work? i absolutely did. did my doctor sit down and express to me not only all the risks of a normal operation but the risk of this product? we positively did. you know, part of our call to action was, what if congress had enacted this medical device safety act back in 2000? for me and my family, it would have been game over. it really does scare us to think where we would be as a family today if some researcher in 2002 decided the status quo was good enough. that the $60 million in investment made in developing,

testing, and marketing the device and putting the cutting-edge fda product on the market, only to have that product's value systematically reduced by lawsuits, just weren't worth it. you see, there's millions of people out there. some of them of your family members who one day might benefit from breakthroughs in therapy still in development. we need to think about these people and these families. parents, husbands, brothers. when we think about the consequences of this bill. do i want safe products? absolutely. for me, the question is a very simple one, senator. who decides? is it the fda experts or juries made up of people just like me, no particular expertise. and i think the hardest part is that juries see only that injured person. they don't see the thousands and thousands of patients that have been benefited from a technology. to me, the choice is clear. we need safe products. we need innovation. and i think the best way to do that is not through litigation,

but through a well-funded, strong fda. thank you. >> thank you very much, for a very profound statement and about your experiences. now, i don't know when we're going to start votes. but we'll start a round of just five-minute questions so we can try to get everybody in. whoever's running the clock, start me at five. there you go, thank you. thank you all very much for being here today. this is obviously a grave and extremely important issue and one that we are going to address hopefully soon. i wanted to start with mr. -- professor mcgarity. opponents claim that this law by reexposing the medical device manufacturers to liability would lead to a loss of innovation in the medical devices market. the kind of innovation mr. roman was talking about. is there any evidence at all to suggest this might be the case? >> i have not seen evidence to

that effect at all. i think that a company will be looking forward to the market and lots of decisions -- lots of considerations will affect that determination. but the likelihood that they will be sued if they do a bad job i don't think is one of the major considerations that play out there. and certainly, just looking at the objective evidence of it, i don't see evidence of that, no, sir. >> i want to try to understand something. mr. hutt, maybe i can get somebody else involved in this too. i want to try to understand the difference between drug regulation, fda drug regulation, and medical devices. wyatt versus levine, the court held the pharmaceutical industry doesn't preempt state court liability. the court held the fda has long

maintained state law offers an additional and important layer of consumer protection that complements fda regulation. so, why are medical devices different than drugs? >> well, let me try to explain that in several different layers. first of all, we're talking here about a statutory scheme that could be applied but hasn't been applied to drugs. so, on a pure legislative basis, they've been handled differently by congress at different times. that's just setting on the statutory basis. with regard to the difference between them, there's a huge difference between medical devices and drugs. for example, the standards for safety and effectiveness #o)@@@" you can change medical devices.

you can't change a molecular entity that is called a drug. so for a wide variety of public policy reasons, congress has seen fit to do things differently for these two types of very, very different products. >> so it's just that congress made that decision? >> yes, congress did. >> okay, so then obviously we can make a different decision. >> yes, there's no question. i don't disagree, this is not a constitutional issue. this is a statutory issue. >> all right. okay. so, really, the difference between drugs and devices is simply a difference that we have

stated legislatively. >> well, there's an inherent difference in them also. >> right. . >> as i said, you can't change a drug. you can change a device. >> why can't you change a drug? they can change the kelche chem >> then it becomes a different drug and it may lose completely the effectiveness. >> can you change a medical device without going through a premarket approval? >> no, my point is that device technology -- and this is a very interesting way that it's developed -- device technology is very well recognized, is an ierative process. we've had a description of how it developed over time. you can't change a drug over time. it is what it is. >> professor mcgarity. >> if i may, there's certainly

differences between drugs and devices. the issue in wyatt versus levine had to do with the warning. the warning is much more like a device in the sense that it's an iterative process. that you can change the warning if the prior warning isn't working or if something else has come up that needs to be changed on the warning. it is the very same iterative process. i would suggest the difference is not that great at all. >> i was reminded by my staff we change drugs all the time for kids. change them all the time for dosages and recommended treatments and things for drugs. >> that's changing the labeling. it's not changing the molecular entity which is the drug. you can change the device by adding something to it, by -- i always say by putting bells and whistles on it. you can't do that once you have a molecular entity, which is a drug. that drug is fixed. for all time.

>> just seems to me they're changing drugs all the time but i have to think about that a second. i'm over my time. senator hatch. >> thank you. one thing that i think needs to be made clear is everybody here wants to see people who are injured be fairly compensated when they suffer injuries resulting from another person's negligence. indeed, i don't think any of us want to prevent people who have been truly wronged from receiving fair compensation. and you've expressed yourself that way as well. >> yes, sir. >> seems to me though the mda as verified by the regal decision provides device manufacturers some level of protection from litigation, many avenues still remain open. >> that is correct. >> under current law, a patient can still sue a manufacturer if the device fails. >> it is a very complex issue, senator hatch, as to exactly

where product liability would be cut off and would not. if the manufacturer follows the requirements of fda laid down in the pma approval, which is -- are very specific. they set exactly how the device will be made and how it will be labeled. if those are followed, then there could be no liability. but if they fail to follow them, then you're correct, there could be. >> okay. if there's a manufacturing defect, what about that? >> if that -- that would mean if you're saying if there is failure to follow the fda requirement -- >> right. >> that kind of a defect, yes. >> okay. >> but please, there's one thing that we have to all understand. devices like drugs often inherently have, you know, problems. have -- they don't act perfectly in everyone.

and as a result, a drug or device that might save my life could hurt someone else. even though it's a perfectly good device or drug. so, the fact that it hurts someone doesn't mean there's a defect. it may be working the best it can. it may save 999 lives and fail to save the 1000th life. that doesn't mean it's defective. >> if the device is labeled in a manner that's inconsistent with the fda's requirements, you can sue there? >> yes. >> okay. now, a device manufacturer may also be liable if they mislead the fda during the premarket approval process? >> not only would they be liable, they'd be criminally liab liable. it's a criminal violation of the act to in any way withhold information from fda or to submit false information. >> a patient can also be -- can also sue for position errors

associated with an fda-approved device, right? >> yes. >> seems to me that instancis where a device manufacturer can truly be proved negligent or otherwise at fault for statutory preemption in the mda has little or no effect. >> yes. >> okay. america leads the world? the development of innovative and life-sustaining medical devices. the entrepreneurial environment, which is very unique to this industry, is the backbone of what sets medical innovation apart from other countries throughout the world, around the world. in fact, the medical technology industry is one of the few that has actually continued to create economic opportunities for thousands of american families, despite the challenging economic environment. now, the decision to develop a medical device is highly risk-dependent. for many, it begins with an entrepreneur or start-up company competing to attract venture

capital and other investments, to bring their product to the next stage. now, venture capitalists are risk-focused. when deciding to invest in a promising medical technology, venture capitalists take many matters into consideration. such as patient benefit, intellectual property protection, and risk of liability. and any uncertainty in any of those elements can be a significant deterrent to investing in any kind of promising technology. now, i'm concerned that without the preemption and the uncertainty of the risk of liability, medical device development and innovation could be stifled. and you've indicated that you feel that way as well. >> senator hatch, i have personal experience with that. i sit on the boards of directors of ten small biotechnology companies, some of which are engaged in the development of

medical devices. and the decision made by venture capitalists based upon such issues as potential liability directly affect every one of those companies. >> okay. well, my time's up. >> thank you, mr. chairman. and i'll be brief. i might not take five minutes because i'm not going to ask a question. i want to thank all of our witnesses. we've got assembled quite an expertise of experience and knowledge and personal stories. you know, several months ago we were in this room, and i have deep respect for senator harkin. debating tobacco. and at that point, the fda was the only agency in the world

that could regulate tobacco. they're only ones that had the expertise. cdc wasn't good enough. there was no other agency. the fda was the only gold standard. they had the only brain trust of employees that could wade through a complicated process. and a month ago we were in this room debating health care reform. in that health care reform debate, we talked about the need for more drugs, more biologics, more innovations. we needed better outcomes. we needed more investment to make sure the outcomes of the american people were, in fact, better. now we're here because of the results of an 8-1 supreme court interpretation of a law that was put in place in 1976 that all of a sudden, 33 i believe years later, this is the single-most

important thing we've got on our plate right now. what's changed? well, i trust my colleagues that our goal is to only get safe products to market. now, mr. hutt, you and i have been at fda, you twice as long as i have. we both know that's an impossible statement. >> yes, sir. >> and let me just read from your testimony, if i can. and i don't think you did it in your shortened testimony. and i quote you. those devices that are targeted in s-540, the proposed legislation would allow judges and juries throughout the country not only to impose requirements that are inconsistent with fda determinations, but to differ from one court to another. the result would be regulatory chaos. if anybody questioned why mr. roman is here, then that's the answer. if you have regulatory chaos, you have no investment, now have

no innovation, you have no venture capital that's at the table trying to drive the next device. you therefore have no innovation. you decrease the outcome of health incidents in the country. n now, the "new england journal of medicine" stated recently that 54 cents of every dollar paid to an injured patient is diverted to administrative costs. the majority of the administrative cost is the legal fee. it's becoming clear as to why we're here. it's because the supreme court has tightened where you can go to court and, more important ly affected their pocketbooks. now, mr. mulvihill?

listen, i want to make sure anybody injured in this country is taken care of. and i don't question your injuries one bit. if there was a defective lead. i think mr. hutt covered that when a manufacturer is negligent on something, if a manufacturer does not follow that prescribed by fda, if a manufacture r -- fa requirements are fairly clear. they're black and they're white. there is no gray area, i've found, in whether it's drugs, devices, or biologics. it is pretty specific on marketing, on labeling, on everything. company goes outside of that, they're basically open game. mr. chairman, i'm going to conclude -- i've got 40 seconds left -- i want to ask unanimous consent to enter it into the record, from the blind veterans

association, a letter. i'll just quote one line. we therefore strongly urge ow you to oppose the medical device safety act of 2009. also, the american military society. deciding which new medical devices are safe enough to be sold in this country is the job for doctors and scientists at the fda, not juries. the u.s. veterans hospice committee. our opposition to this legislation is driven by our strong belief in the need for greater access by these veterans to many medical devices used in the end of life hospice care setting. and lastly but not least, a letter signed by a number of companies. i'll just highlight a few. the american health care association, american insurers association, american tort reform association, the business round table, 3m, national association of manufacturers. u.s. chamber of commerce. their last line. for these reasons and others that are detailed in the attached letter from march, we strongly urge you to oppose this

legislation. i would ask unanimous consent they be included in the record. once again, i thank our witnesses for being here. >> without objection, thank you very much, senator. senator hagan. >> thank you, vr chairman. i just want to thank all the witnesses for being here today and especially the two men, the patients, thank you so much for your testimony. i just have one question, wanting to ask -- i'm not sure exactly who this isdb#2$

now, dr. maisel, do you believe themeisel, do you believe the fda approval process is so good that manufacturers of these devices should receive immunity when they are faulty or cause injuries? you've been there. tell us about that. >> i think the fda does an exceptional job of evaluating medical devices and they are extremely thorough. i think the biggest issue i have is this concept that manufacturer liability stops at device approval. i try to outline in my testimony all the responsibilities of a manufacture

manufacturer after the fda approves the device. they're still manufacturing the product. there are many compliance guidelines they need to follow for manufacturing. and it's simply impossible for the fda to monitor individual companies when there are 15,000 manufacturers and 100,000 devices being produced. so the idea that only those companies that get caught by the fda are the ones that are going to be held liable, i think is bad policy. it's also interesting to note that a u.s. house committee report in june 2006 noted the decline in enforcement reports and enforcement activity of the fda and the number of warning letters issued by the fda declined 50% between 2000 and 2005. every single office that the fda had to decline with the device center having the largest decline in the number of enforcement letters issued. so the concept we're going to

rely on the fda catching manufacturers doing something wrong in order to support consumer liability is just a bad policy. >> but once you make a device -- well, let's see. i guess you can change the device. you can change them and stuff. if they make a change on a device, does it have to go all the way back to the beginning again and go through the premarket approval? >> manufacturers can make modifications, and they need to let the fda know about that and submit supplements to their pma application. >> so it doesn't go right back and go through the whole process again. >> that's an excellent point because the medtronnic defibrillator in question that we're talking about was fully a supplement application. it was not an original pma and that supplement application had no human clinical data. so they made a modification to their lead. it was never implanted in a human before approved by the fda. no human data was submitted to the fda to support its approval.

the device is approved on the basis of bench testing in animal data, and then it goes into close to 300,000 patients. the question isn't why are we here. it's obvious why we're here. it was inevitable that something like this would happen. >> okay. now you just told me something i did not know. you are saying that a device manufacturer like this medtronnic defibrillator. when it went through the whole premarket approval and everything. it was approved. later on, they made a change to it, but it didn't have to go back and be approved and they did no human trials? >> it did need to be approved. the original pma was submitted around 1992. the supplement that approved the fidelis lead in question was approximately supplement 25 or 30, somewhere in that range. and each of those supplements goes back to the fda for consideration. but supplements often do not require human clinical testing. and so you're now looking at a

lead 15 years removed from the original pma and there's not a lot of clinical data submitted to support its approval. >> the idea that lead is going to function perfectly well and the manufacturer will never be liable for it seems an interesting policy. >> thank you. i'm a minute over. >> thank you, mr. chairman. you have any comment about anything that's been said so far? >> a supplemental pma, which is required for any change of any kind is required to be approved by fda using the same standards of safety and effectiveness as the original pma, senator harkin. i don't want there to be any confusion about that. fda looks at the entire pma when the supplement is submitted and either approves the device as changed, as safe and effective,

or not. so there is no distinction between the original and the supplemental pma. the fda in this instance, perhaps incorrectly, i do not know the facts, but what they did was they looked at all the data on safety and effectiveness in humans. they concluded that the new lead did not require additional human data. now i am not a scientist, and i cannot say they were right or they were wrong. dr. maisal is more qualified than i to make that judgment, but i don't want there to be any confusion about what the process was. >> okay. mr. mulvihill, did you sue because of the difficulties you went through or -- >> when this first happened, i did not intend to sue. i liked my doctors in davenport,

iowa. i didn't know there had been a problem with the leads. i wasn't told that. in october of the year that i had my problem, four months, five months later, whatever it was, a friend called me and said did you see the paper about medtronnics, fractured leads. i said, no, i hadn't. i was thinking about it. i looked at it. my wife and i discussed it. i didn't do anything for a good, long time. it was the end of january, first part of february before i contacted a firm and they agreed to take a lawsuit. >> i see. okay. now mr. roman, i understand you'll be going right from this hearing out to the bonneville plant in my home state of utah for the bonneville speedweek to try to set your fifth land speed record. >> yes, sir. >> i don't want to call you nuts, but we're very proud of that. >> thank you very much.

and i think one of the things we're most proud sufficient the second opportunity the family has been given. one of the things we've tried to do is incorporate the military warrior. marines are first. i get a lot of grief for this, by rule is first in, first to win. i'm not up for argument. we'll take the u.s. military with us and go set some records. >> i want to wish you the best of luck in your endeavor. you stated that the first final stimulator did not work for you and the technology from the second implanted stimulator pushed the envelope and was risky. after considering all those factors, can you tell us what made you still decide to get the second device and have you had any regrets since you got the second device? >> plain and simple, sir. family. i wanted my family back. i wanted a chance at a normal life, and, you know, the original trial didn't go well

with the first stimulator. it was like being electricuted. i felt from my rectum to the top of my head, it felt just pounding and, for me, it didn't work. go out five years later, the morphine levels are now up to 300 milligrams of morphine a day. i'm hallucinating. suicidal thoughts are pretty constant, and, for me it was desperation. >> a matter of quality of life. >> i just didn't know where else to turn. the remarkable part is during that time how technology had changed. and it was like night and day when they turned this system on because it was based on the cochlear implant technology. it was very smooth and i could steer it and control it a lot more than the pounding electrocution i felt. >> i'm really glad you did what you did and i'm glad you have that response. mr. gmcgarity, i have a lot of respect for you.

as you can see, you and mr. -- differ quite a bit. i'm as concerned about these issues as you are. on the other hand, i am concerned about having the best medical devices we can find. and i do know -- i do know there's a balance here that has to occur. i don't think any of us want somebody to be hurt by medical device. it's truly the thought of the company or anybody else for that matter. it's a tough area. these are tough, tough decisions. but my time is up. i was going to ask you a whale of a question, but -- no, that's fine. i just wanted to mention that i have high respect for you. >> why thank you. >> well, i have one other thing i'd like to pursue and i'm just

thinking about this. i am informed -- the fda does not have subpoena power, does it? >> no. >> no, it does not. >> so let's say -- let's just think this through a second. if a device manufacturer knows now under riegel that they are not subject to tort lawsuits, therefore, they're not subject to discovery that would go on in a lawsuit, and if fda doesn't have subpoena power, and let's say that, you know, yeah, i was thinking about this because there's a case here. warner-lambert kent, which you probably know about. manufacturers who commit fraud on the fda are not immune from lawsuits. well, okay. let's say that a device manufacturer doesn't submit all the information to the fda. the fda does not have subpoena power. therefore, they approve it.

it goes on the market. people are injured. there's a recall. but because they cannot sue, you cannot get discovery to find out whether or not they ever even committed fraud on the fda. so i hope i made myself clear. if a device manufacturer commits fraud on the fda, puts the device out there but@@@@@ @ @ @

and regarded by fda as the most serious violation if a company that fails to submit all the relevant safety and effectiveness information as part of their pma. and i can assure you when i was chief counsel, the one area that i always considered criminal sanctions was the failure of a company to report things they were required to report, either with the original application or after a drug or device was marketed when there are also reporting requirements. fda's criminal authority is the strongest criminal authority under any federal statute.

it does not require knowledge or intent by the company or the individual. it is what we call strict criminal lib ibl and fda does employ that whenever there is proof that someone violated those principles of reporting. >> mr. maisel, could you address yourself to this? >> sure. i will read a quote from the fda inspection report, page 13 of a 25-page report. this is the fda. when we ask to see some in-process field product inspection reports, we were told they were not able to let us view them. that's the fda on the medtronic issue. >> how can -- >> i'm getting two different things coming to me, and i can't handle this. >> the company may have said that they didn't want to give it to fda. but if they didn't give it to

it, that's a violation of law, period. full stop. >> i think the point or the -- >> so my question -- if they wouldn't give them the information, why didn't the fda demand it or what could they have done? >> fda could demand it, and if the company refused, fda could bring a lawsuit. >> a lawsuit. >> yes. they could penalize the company. they could seize the offending illegal products. they could enjoin the company against future violations. they could bring a criminal prosecution. >> on this case, it's the fda's fault they didn't get this? >> yes, that is true. now dr. maisel made a point earlier that he and i are in complete agreement with. fda needs complete appropriation. the statistics, for example --

>> they're not going to give them that. >> the statistics he quoted were from a few years ago of the downturn in fda inspections and other forms of enforcement action. but in the last two years, fda appropriations have increased by $900 million from $1.4 million to $2.3 million, and it was precisely because the fda science board report of late 2007 said that the agency was being starved to death. now they've got the funds. >> i deal with fda a lot on another hat i wear, agriculture. they don't have the resources to monitor all the things we asked them to monitor. >> not everything, i agree. >> that's for another discussion. do you have any other -- >> on this issue. see, my point was whether or not

you could ever get to the bottom of whether or not a company gave all the information to the fda in the first place or not. and if you don't have a lawsuit -- you understand what my question was? >> i do, and i think you've well summarized the issue. the fda does not possess the authority to, quote, demand documents other than to ask for them. but if they don't, then mr. hunt says they should sue them. that's as i understand. >> that's back to the future. that's where we were before the medical device amendments back in the 1950s and 1960 when the fda regulated devices by trying to take them to court one at a time and spent a lot of money and it was very inefficient. >> so you're saying it would be -- it almost -- i wouldn't say next to impossible but since you have 15,000 manufacturers out there, is that what you -- >> correct. >> that would be hard for them to -- if they demanded, let's say, 50 of them or 100 of them,

would they have the personnel then to go and lawsuit every single one of them at fda? >> i think you know the answer to your question. >> yeah. >> i don't know where they get the money to hire these high priced lawyers and these big law firms. i'm just kidding. >> senator in my experience, it's a rare event when a company declines to obey the law and provide the documents that fda is entitled to. >> i would agree with that right now, but under riegel, if they can say, my gosh, we'll never have to give those documents up, it would be a rare instance for fda to ever take us to court to sue, and mr. mulvihill can't sue us now and his lawyers can't get discovery to get those documents. hey, you know? >> senator, their lawyers are going to tell them if we don't produce these documents, we can go to jail. the ceo can go to jail. that's who fda brings criminal

prosecution against, not some low-level people. there were two supreme court decisions. one in 1944. one in 1975. upholding fda authority to bring criminal prosecution against the highest corporate officials because they are ultimately responsible for the actions of the company. >> mr. mcgarity, i went over my time. >> just a couple of points. one is, yes, that might happen, but it doesn't. you don't see that many criminal prosecutions. hopefully it's because it doesn't happen that often, but the fact of the matter is the underlying fact of the matter is that when we get this information about what was going on in the drug company files, in the device manufacturer's files, it's not because fda inspectors got it. it's because a plaintiff is sued and we've had discovery. we've had depositions taken. we've had sometimes a

whistleblower within the company come forward with that information. but it's not because fda turned it up. >> let me just say this. we've had extensive experience with the fda, and they don't miss much. and the constant complaint is they are over regulatory, if anything. now i don't know the instance with -- i've heard that same point that you've made, dr. maisel, about medtronics. but if fda wanted those materials, they would have gotten them. i don't know what the reason was behind it. maybe they did in the end. i don't know. but one concern that i and others have with this legislation deals with the mission of the fda with regard to medical devices. under the current regulatory system, the device manufacturers have to go through an extensive review process and analysis from top experts of the fda and elsewhere. they have to strictly adhere to the fda's labeling and marketing

requirements and even after the device is on the market, they have to report back to the fda on the implementation and use of the device, including any adverse events. so what we're dealing with is a bar that is already set exceptionally high. this legislation, it appears, would allow panels of randomly selected jurors with no expertise at all in the field or any aspect of it to overrule this entire process and create whole new standards of suitability and market readiness for medical devices. now does this legislation not suggest -- let me ask you this, mr. hutt. does this legislation not suggest that a jury of 12 layman is better able to determine the future use and availability of these highly effective devices?

and if so, what could be the justification for that? >> that is precisely my concern, senator hatch. fda is not perfect, but certainly a jury is going to be less perfect in determining what is a safe and effective medical device. >> the ultimate goal is to get the very best devices we can to really help people, like mr. mullvihill, like mr. roman, in ways they've got to be helped. and we've kind of split the baby here. is that a fair appraisal? >> i agree with you. one of the best parts of the medical device amendments of 1976 was an innovative provision under which advisory committees would be convened for every pma device to make certain that outside independent experts agreed with fda that the device is safe and effective.

and doctor maisel, who has chaired one of those committees and has obviously spent a lot of personal time for which i think all of us should thank him. it's that kind of work that makes the system work. that's the way that fda confirms whether a device is safe and effective and has sufficient data to go on the market. >> okay. mr. mcgarity. you argued the common law serves an important deterrence function and to some extent, i suppose i agree with that. specifically you stated to the extent the compensatory and punitive damage awards imposed are greater than the cost of avoiding the harm, a rational company will take protective action to prevent causing damage in the future. now i see some problems with the application of this reasoning to highly regulated areas like

medical devices. fda regulations make unilateral changes in labeling, design or manufacturing processes virtually impossible. so while it's a convenient -- it's a convenience to argue that a device manufacturer would simply and quickly update their product whenever they hear about a possible risk, the current system does not allow for this and for good reason because the initial process is so intensive, and sometimes intrusive, it only makes sense that any subsequent changes to a device receive similar scrutiny. even if the law allowed for changes to be made so easily, how could a manufacturer ever be confident the action they took would be sufficient to avoid a plaintiff suit? one thing we can learn about the trial bar is there is no shortage of legal theories on which to file a lawsuit. in your view is there no benefit to offering limited protection

for manufacturers of such highly regulated products to ensure the advancement and availability of these life-saving products. >> i think that's a very good question, senator hatch. and the answer, i think, goes to the nature of the common law. you alluded to it on several occasions this afternoon. the negligence standard is fairly uniform across the country. the standard of defective product. there are some minor variations in the state, but it's a standard of care that we ask a drug or device manufacturer to come up to. when the manufacturer anticipates that they might be held to violate that standard of care in the future, one hopes that that affects their decision. particularly once the device is

out there on the market. the fact is true they have to go back to fda for approval if they want to change their device. it is also the case, particularly when it comes to the label or the warning on the device, that when you go back and say i discovered a problem with this device, it's not as safe as it needs to be as i've discovered from reports or whatever that have come in to me. and i want to fix that and make it safer. fda doesn't get in their way. fda doesn't say, oh, well, we wouldn't want you to make it safer. if that's going to take too much time or too much effort. they tend to not get in the way of safety enhancing approvals. but you're right. they do have to go back to fda at some point to get that

approval before it actually changes things. when a jury holds a defendant liable, they are not issuing an injunction saying that you must do things differently. they are simply holding the defendant liable in that particular case and the defendant then takes that message and does with it as the defendant thinks proper or appropriate. >> well, in most instances, product liability lawsuits are resolved in the courts long after the safety issue is over. because what happens is through various mechanisms, first doctors report problems with medical devices. they report it directly to fda. second, some doctors or patients report it directly to the company. as soon as those reports come in, any intelligent company starts to say, what do we need to do?

is this inherent in the product, like mr. roman was talking about with his first generation product that it's just the way it is. science and technology can't improve it any better. but if there is a way of resolving it, that's done immediately. and fda and the industry will cooperate. i agree with tom on that. but the point is that all that occurs before any product liability lawsuit arises. the product liability lawsuit punishes the company. it doesn't increase the safety or effectiveness of a single device. >> one last thing. there are a lot of small companies that come up with some very, very creative products. what effect would it have on that process? that's what i'm concerned about. there are huge big companies that might be able to withstand some of this. but the innovation and

entrepreneurial makeup of our country, it's generally the smaller companies that come up with these devices. and i don't want that stallified. >> yes, sir, i agree. >> mr. chairman, this has been a very interesting hearing. and i want to compliment each one of you as witnesses. each one of you has contributed a great deal to us. i wish i had really totally definitive answers to solve the problem of the three witnesses on our left and yet still be able to have the devices for people like you, mr. roman, who, really, had a miserable life until you were able to get that device and get it to work. >> second chances come in all shapes. >> well, i would just say when the top -- what did i say? i had that figure.

when the top 25 medical device companies had a net profit of $173 billion before the recall decision, i don't think innovation was stivled at all that at time. >> for the small companies, that's for sure. >> they made a lot of money, orrin. >> yeah, the 25 companies. there are thousands and thousands of companies. many of them are very small. that's where a lot of the innovative ideas come from. they'd be stifled if we went to -- >> then i'll say this for the record. i don't care how small they are. i don't care how small they are. they better meet the most stringent standards of safety and efficacy. i don't care whether it's a drug or a device. >> i agree with that. >> and if they don't adhere to that, and if it injures a person out there, now, again, it has this whole idea of preemption. and as a lawyer, i've looked at

this a lot in the past. it just seems to me that there was always, i thought, a presumption against preemption in the law. presumption against preemption. quite frankly, it's my reading of a little bit of the history of this is that the fda's position, until the early 2000s was basical lie's presumption against preemption. but that all kind of changed. and i think it's up for us as the legislative body to decide. >> to borrow your words if they don't adhere to that, they may have some liability under current law. >> under criminal law. >> both. bo both. >> if they're preempted, how are you going to get into court? >> if they don't abide by the rules the fda sets up, they may have some real difficulties. >> you are right. >> i know i'm right. >> but the problem is without discovery and stuff you won't be able to get that information, and that is -- >> they'd be able to have that

stuff. >> that's the conundrum we have here with this issue. and you say, well, the fda can go after him criminally and perhaps get that. but you just can't do that on every one. and the risks, you know, companies take risks. investors make risks. well, the odds are maybe 10,000 to 1 that you'll never have to do this. >> well, that's pretty good odds. i'll make a lot of money off that. >> we thank you all coming. >> well, just a minute. i haven't adjourned this hearing yet. and i do have the gavel. >> i was just trying to leave and in a gracious way. >> i just want to ask for the record. i have two things to put in the record. one is an editorial from the "new england journal of medicine." new england journal of medicine. when did this article appear?

march 2009, "new england journal of medicine." in which they said that -- i won't read the whole thing. as the law now stands, failure to warn and design defect lawsuits are preempted for medical devices but not for drugs. this perplexing state of affairs defies all logic. to address the inconsistency and to improve the safety of medical prtd products, they went on to talk about the bill. patients and physicians deserve to be fully informed about the benefits and risks of medical devices and the company is making the devices should be held accountable if they failed to achieve this standard. we urge congress to swiftly pass this legislation. that's new england journal of medicine. i had another article. by margaret jean porter, chief counsel. well, she was chief counsel.

former chief counsel of the food and drug administration. and i just have one quote from that. although the agency, meaning the fda, had not formally expressed its position on the issue of preemption, it's clear from the views it expressed in many other contexts that it did not believe that state court claims were preempted under the medical devices act, mda. indeed, this is the prevailing view and n the legal community until the early 1990s. no arguments were put forward that there should be preefltion of these claims. so i just ask consent that those two articles appear in the record. oh, i'm sorry. i'd like to also submit eight letters from victims of faulty medical devices also encouraging us to pass the medical device safety act. now i would just say, if i

thought for any amount of time that this would really stifle innovation, i happen to be for innovation. i happen to be for new devices. i happen to think these are good things. but i also believe in holding people accountable to the strictest standards of safety and manufacture. and i'm concerned. i'm just concerned about the fda. i've been concerned about the fda for a long time. i have a love/hate relationship with the fda. i can tell you that. sometimes they do good things. other times they don't do what they should be doing. more often than not, it's because we have not given them the resources with which to do it. and i kind of interjected, even when mr. hutt was speaking. i don't mean we don't want to give them. we should give them the resources. we've asked them to do a myriad of things. and yet we don't give them the

resources to carry it out. so count me as one that also believes we ought to do more in terms of giving the fda those resources. i just think under the present budget resources and stuff like that, it's probably not going to happen. >> did anyone have any final comment? i think we're now starting to vote. i have to go vote. you'll set a new land speed record? >> yes, sir. friday and saturday. >> so you'll break the sound barrier? >> not the sound barrier. in our class, about 170 miles an hour. >> i don't know what class this is. >> different cars run at different records. our class record is about 170 we're shooting. . >> i thought somebody broke the sound barrier on -- >> somebody did break the sound barrier. 746 miles an hour is the new record. everyone has to have goals, senators. you started out as a councilman, you moved up and everything. >> well, good luck to you. >> thank you all very much.

the record will be kept open for ten

good morning. i would like to call the hearing to order this morning of the subcommittee on disaster recovery, which i'm proud and happy to chair. i thank the staff for helping prepare the meeting this morning. today's hearing is entitled focusing on children in disasters. the committee's objective today is to evaluate the very special needs of children during the preparedness response and recovery phases of disaster, and the extent to which our current planning and programs either meets or fails to meet these special needs. we're focusing on children and their needs for several reasons. first, children in most families are the focal point and parents who cannot find an available school or day care center or access health care for their

children may be forced to relocate after a disaster or worse, in some ways, be forced to stay out of the work force when they're actually badly needed to help rebuild their communities starting with their own homes, churches and places of worship. according to the bureau of labor statistics, about half the nation's families include children and 90% of those families include a parent that is a member of the work force. so getting your work force back to work after a disaster is one of our primary goals. it seems to me to be very difficult if we're not doing our best to provide them help and support with proper placement during those daylight hours for their children, either in schools or day care, and provide the mental health counseling that children need and families need to sustain themselves. so we must be mindful of the fact that people cannot return to work or begin rebuilding

until they locate a safe and productive environment. these parents, i may remind everyone, are the nurses, the doctors, the first responders, the police officers, the grocery store owners, the gas station operators, the electric line repairmen or other citizens who play an important role in the communities' return. that means the provision of child care and reopening of schools must be a top priority. i would like to show a chart of the number of day care centers that were operating and ben, why don't you stand up there and show this chart. you all have it in your documents. but in august of '05, the purple line shows how many day care centers were open and of course, you can see the dramatic fall-off over time. the second reason we're focusing on children here today is that children are a vulnerable population with unique needs that require special planning to

address, but in my view, they have not received the same level of attention that some other populations, whether it be the adult homeless or the disabled or the elderly generally. a broader goal of this hearing is to encourage the nation to consider the mental wellbeing of a community as a key indicator of recovery, every bit as important as the restoration of infrastructure, housing and the return of the economic tax base. i would like to take a moment to commend the "washington times" for their particularly insightful articles, actually the last couple of days. it was a coincidence that they were running these in line with our hearing. and wanted just to quote from one of the articles that was august 3rd. says almost four years after the massive hurricanes inundated much of new orleans that killed about 1800 people, millions of words have been written about the devastating physical damage to the city, and hundreds of

millions of dollars have been spent on fitful efforts at reconstruction, but almost nothing is said and relatively little has been spent on the more silent wreckage, health of new orleans residents who were pushed over the edge by terror and turmoil of the storm and have been unable to recover emotionally or mentally. when i say new orleans, i mean the greater new orleans area and in large measure, you could almost substitute the gulf coast for new orleans. local response plans must be provided for evacuation, sheltering and continued care of children from facilities where they are likely to be clustered at the time of the disaster, or called for evacuation either at day care centers, schools, hospitals, including the neonatal wards and maternity wards. katrina showed us the impact of failing to include nursing home sector in our evacuation plans and we must ensure in the future

that facilities which house other vulnerable members of our society are included fully in these planning processes. save the children issued a report last month called the disaster decade, indicating shockingly that only seven states currently require schools and day care centers to develop a comprehensive evacuation and reunification plan. those states are alabama, arkansas, hawaii, new hampshire, maryland, massachusetts and vermont. the other states have virtually no plans. local emergency managers and facility owners can do more to expand planning efforts, states with planning gaps may consider requiring these facilities to develop plans as some states have already done and obviously, the federal government has a role to play. another concern raised by the report is the fact that child care is not eligible for funding under the stafford act as an essential service. i would like to ask and plan to

ask our fema director, craig fugate, who's here, to address this in his testimony and i understand that he will. in addition to schools and day care centers, we will also consider newborn infants and mothers who may be in hospital wards when disasters strike. according to hhs, an average of 36 babies are born each day in new york city and in los angeles, the daily average is 416. if an evacuation was called in any of those cities, you can understand the difficulties of moving that kind of population, if necessary. the senate version of homeland security bill for fiscal year 2010 includes an amendment i offered encouraging dhs to conduct massive evacuation planning with states and local governments and nonprofits, including monitoring, tracking and continued care for neonatal and obstetric patients.

women's hospital will be testifying in the second panel. they excluded -- executed this function for the state during the response to hurricanes katrina, rita and gustav and have a great deal to share. my statement is much longer. i will summarize the rest of it for the record because i'm anxious to get on to the panel. but let me just say a few more things. after the hurricanes, a demand for mental health services spiked due to an increased trauma, depression and substance abuse. that was combined with the loss of in-patient beds and work force capability which created a severe gap and strained medical workers and facilities, host communities and first responders. it's startling to know that the lsu department of psychiatry screened 12,000 children and schools in louisiana during the 2005-06 year. 18% of them had a family member who was killed in a hurricane. 49% of them have met the threshold for mental health referral. one year later, the rate was

lower but it was still 30%. 28% of displaced children in louisiana are still suffering from depression or anxiety. the suicide and attempted suicide rates for adults are startling. i'm going to include those in the record but some are reporting that the suicide rates are three times higher than the national average but what struck me was not just the high -- height of the suicide rates, but the number of people who had attempted suicide but failed was startling. it was something like, if i remember, 116 people had committed suicide in one year but 750 had attempted suicide. the crisis counseling assistance and training program is jointly administered by fema and samsa. it is intended to counsel survivors, to teach them coping skills. we obviously need to do a great deal more. there's a chart that shows, if you will put up the confusing

overlap of the number of federal programs that are available but they are very stovepiped there's the other one. the number of programs that are available, this graph shows it a little bit better. the number of programs that are stovepiped. some have eligibility requirements and some don't. i know this print is small but basically it's a list of all the different programs offered through federal government grant programs, et cetera. but there is no sort of comprehensive community delivery system in my view in place right now to cover the extraordinary needs after a catastrophic disaster that affects a community the way it did to the greater new orleans area and in large swaths of the gulf coast. so in conclusion of this

statement, i would just like to -- i'm sorry, there are 21 different federal programs, as i indicated, and three of the 22 medicaid, schip and head start, have income eligibility requirements that limit their ability to provide services in a seamless way after a disaster. the consolidated appropriations act of 2008 established the national commission on children and disasters to conduct a comprehensive study and examine children's needs. mr. shriver and dr. redlener are members of the commission and we are pleased to have them with us to talk about their recommendations in their testimony later. finally, i would like to conclude with a quote from chris rose, who is a columnist in the "times picayune" that probably wrote more extensively on a daily basis about this than any person in the country. he gave the commencement address to my alma mater high school that's been in new orleans for

275 years. he spoke the year of the storm and he said there was a hurricane, he said his daughter wrote, he's saying my durt was asked to write about her experiences over the past year when she came back to new orleans. this is what she wrote. there was a hurricane. some people died. some of them were kids. my daughter, he says, was 6 when she wrote that. it just doesn't strike me as what you would wish for your child to write in her first grade journal. but there it is. you, all of us are marked for life for what's. like it or not, this storm and its circumstances have marked you. this was part of chris rose's comments to the graduating class, we call them the katrina class that graduated because it will be four years this august, that graduated in may. these were the freshmen in high school and freshmen in college when the storm hit and the kids that were in kindergarten are in

now fourth grade, so they know themselves as the katrina class. and i think this is a good place to start this hearing because these are real results from a terrible catastrophe that happened. we're still struggling with how to respond better, how to plan, how to recover, how to respond, and the needs of children are of primary interest to me and particularly the mental and emotional needs of the community at large as we seek to build a better and stronger community. so with that, let me submit the rest of my statement to the record and i would like to introduce the first panel. we have craig fugate, administrator of fema, who has been on the job now for about two months. two months. and is already making some very positive changes. we have rear admiral nicole

lurie from the assistant secretary for preparedness, u.s. public health, department of health and human services. we're happy to have you, admiral. and cynthia bascetta, director of u.s. government accountability office. they have issued a recent report and we are interested in hearing about that report relative to the subject. i will then introduce the second panel at the appointed time but mr. fugate, let's begin with you. thank you for being here this morning. >> well, good morning, chairwoman landrieu. i have submitted my written testimony. i would ask that be entered in the record as i have some opening remarks, if that's okay with you. >> that's fine. thank you. >> as a paramedic, one of the things i was taught early on in dealing with medical emergencies was that children are not small adults. that may seem like duh, but it points out that not only are the

pharmacological needs of children different, it goes to the whole aspect an adult, you don't just size down to a child and get the same outcome. you really have to focus on children, their brain development, their mental capabilities and their physiology are vastly different from adults so your treatment approach has to be geared towards a child, not merely taking what you would normally do for an adult and make it smaller. i think that's one of the challenges we have when we look at planning. historically, when we look at communities and we write planning documents, my observation, i've been doing this for awhile, is we tend to write plans for us, adults, the people that have high school education, they speak english or have more education, they have a car, they drive, they have resources and they can pretty well take care of much of their needs, so we tend to write a plan for that population. then we'll go back and go well, now we got this other group, they have different challenges, we need to write a plan for those, we'll come up with a second plan and third plan and fourth plan. that's been our approach.

we're going to try something different and based upon the concerns that have been raised by the commission on children and disasters and the gao reports and the issues you've raised, we've decided to take a different approach in fema and instead of writing our plan for the adults and then try to figure out how we deal with everything else, let's write plans that actually reflect the communities we live in. they have children. there is people with disabilities. there is frail elderly. but let's quit putting all these populations in a special box that we'll get to after we get the plan written and let's do this from the beginning. so we're going to start with children. as you point out, there are cross-cutting issues not only when we talk about disasters but just in the daily delivery of service programs that oftentimes we do not take advantage of when disaster strikes. there are many things that i think if we looked at children up front at the beginning, across all the areas, and we're starting internally with fema but we also want to look at and work with our partners because again, as we continue this

journey as i completed my second month and looking forward to completing my third, i hope, is fema's not the team. fema is part of a team. i think we have to do a better partnership with our federal partners where they have the expertise in how these programs need to be delivered, the needs that we're going to face, particularly when talking about this hearing, children, both from their physical needs as well as dealing with emotional and mental support so that we reduce that trauma. we know that historically in disasters, that in high stress and the events that children face, the quicker we are able to get to a sense of providing routine, to intervene early, the better the long term outcome is for those children. well, that means you cannot just look at what fema may be able to bring, but look at how do we take existing programs that are already every day in the community and leverage that and particularly when we look to our federal partners, their expertise, in helping us design programs that achieve a change in outcome. not just merely look at an

administration of a grant program and hope we get where we need to go but really get our partners to drive that process of how we need to structure and put together these programs so we effect real change. so we have put together and have worked with secretary napolitano to form within fema a working group whose sole focus is to make sure that throughout fema, we are addressing children issues from preparedness grants, training, exercising, all the way through our response recovery activities. and again, we continue to work on these issues everything from some of the issues we ran into, unaccompanied children, working with the center for missing and exploited children, to establish a child locator center. working with some of our programs like citizen corps, where we have the community emergency response team that now has programs designed for teenagers to become involved in that. also working in looking at how we incorporate this across with our state and local partners.

the day care centers, particularly are a challenge because in a hurricane, these are going to be part of the overall, they're closed down as children are reunited with their parents before evacuation orders are issued, but an earthquake would happen during those time b and reflect on it, it's been a really good time for us again to reflect on both the strengths

and the gaps that remain in our national emergency preparedness response and recovery efforts. we all know that throughout this, you have played it out and mr. fugate has, that children and their families are often the most impacted and bear the most long-lasting scars of this. let me say first, having spent now a lot of time in new orleans, my heart goes out to all of those who continue to suffer throughout this. what i want to do is talk to you today briefly about hhs' efforts in the last four years to address particularly the needs of children, with the focus as you requested on evacuation, particularly of neonates and obstetrical patients and mental health. we all know preparedness is a critical part of what we do. we are completely in sync with mr. fugate about the need to plan for the entire community and a community as it is, and communities are different. we need to plan to their needs. for that reason now, my office

has now more than 30 regional emergency coordinators who are actually on the ground in communities, sort of the eyes and ears to really know how to plan exactly for those needs. we know that in the long run, this preparedness and planning promotes resilience and enables communities to cope with the emergencies that come upon them so building community resilience is a really important part of what we do. by way of example, one of the important programs that we've gotten under way over the last couple years are partnerships to really look across the population spectrum as we just heard about, and to integrate really at the front end all of the groups that might be considered in the vulnerable category because when you add them all up, there's an awful lot of the population that's vulnerable but kids and pediatric populations often very much rise to the top of the list. other kinds of programs that we have developed in response to this include training curriculum for school crisis teams,

disaster communication messaging and a lot of work to develop programs in emotional first aid to early on, address those emotional and mental health needs of children. it's important as we just heard to do that at a developmentally appropriate level and that means across the whole age range of kids as well as adults. the national child traumatic stress network has been really instrumental in this regard and launched the psychological first aid field operations guide immediately after the hurricane. we're really proud of the fact that those materials have now been picked up and adapted throughout the country. on the response side per se, obviously during an emergency, it's critical to support the state efforts to provide quick and competent assistance to everybody, children being no exception. the national disaster medical system, otherwise i think as you know, ndms, is the primary federal program that supports

patient care and transfer during this evacuation of patients. it has both pediatric and obstetric capacity and i think since the storm has really worked very hard to upgrade its training, its material and its transportation capacity in this regard. so this ranges from specialized equipment to transport teams who are really specially trained and capable and to be sure that all of our teams now have those special capabilities involved in them. in addition, as i think you know, the pediatric disaster coalition was formed by advocates and planning region six which includes new orleans and the gulf coast and its goals have also been focused on not only getting people out but identifying the appropriate receiving facilities for these children and their families and anyone else and being sure that everybody knows about them and that that planning is integrated into community operations plans

at every level. mental health needs can't be separated from the rest of other children's response needs, and how we respond early on is going to really impact the mental health of children and their families going forward. the crisis counseling assistance program as you know is an example of collaboration between hhs and fema, as this is administered by the substance abuse and mental health administration, and has crisis counselors routinely working at all of the places where children congregate. as a complement, the national child traumatic stress network also has a cadre of rapid response teams that can be mobilized after a presidential directive. recovery is really complex and i think as we all appreciate, it's been really sort of underattended to until this storm. for this reason, we are very excited about the new directions that fema is taking and are

looking forward to working on the children's discovery efforts that have just been described. hhs also started its own recovery coordination effort and now has recovery coordinators identified in each district and a concept of operations that integrate many of these stovepipe programs, particularly within the hhs family, and we're continuing to work on building that out. i think that we've made a great deal of progress in addressing the needs of children in disasters in the last four years. we also have a long way to go. and i think we would be the first to tell you that. as we look forward to the future, we have a lot of planning and preparedness efforts under way. there's terrific research that's gotten started over the last four years. the challenge now is to take what we learn from that research and translate it into practice and best practices that are going to help communities all

over the country, and on the ground. we are committed to the highest level of planning response and assistance to recovery for children in emergency events. we are most appreciative of the important work that the national committee on children and disasters has done to highlight these important efforts. i also want to call out the work of the national biodefense science board, which had a work group focused very specifically and make recommendations for us on the important needs and mental health needs of children and their families going forward, and we are now moving forward to integrate a number of those efforts and i think during the q & a, we will probably have an opportunity -- >> if you could wrap up. >> -- to tell you more about those things. so thank you very much. >> thank you. miss bascetta? >> madam chairwoman, thank you for inviting me to testify about our recent report on barriers to

mental health services for children in greater new orleans and to update you on our recommendations to fema in its efforts to support states faced with the mental health consequences of catastrophic disasters. my remarks will be a reminder of why fema's commitment to children is so very important. as you know, the psychological trauma experienced by so many children in the aftermath of hurricane katrina increased the incidence of depression, ptsd, risk taking behavior and other potentially long-lasting behavioral and emotional effects. it is well known that children who grow up in poverty may be at even greater risk of developing mental health disorders and in new orleans, the slow pace of recovery and the recurring threat of hurricanes may further exacerbate their trauma. against this backdrop, we found persistent barriers to providing and obtaining mental health services, although federal grants are helping to address

them. lack of mental health providers was identified as the number one barrier to providing services. the designation of the parrishes in the greater new orleans area as mental health professional shortage areas underscored this barrier and state data showed a large decrease in the number of psychiatrists and clinical social workers who received medicaid and c.h.i.p. reimbursement. to help address this shortage, funding from hersa and cmf provided incentives to almost 90 mental health professionals who either relocated to or decided to stay in new orleans. the second most frequently identified barrier was sustainability of funding. we found that although most of the federal grants we identified existed before katrina, the hurricane related programs has been a key source of support for mental health services for children. much of this funding is temporary and it is too early to

know whether sustainability can be achieved by these programs. we also reported on barriers to obtaining services for children and the top three were a lack of transportation, competing family priorities and concern about stigma. officials told us that funding from several programs had been used to provide children with transportation to mental health services, although none of the programs were designed solely for that purpose. examples include medicaid, the community mental health services block grant and the social services block grant, as well as samsa funding. similarly, block grants and disaster housing assistance program funds were used to help families struggling with housing, unemployment and other expenses. there was also federal support for case management and referral services designed to help families locate and obtain mental health services for their children, although we found a lack of continuous and reliable funding for case management.

stigma as well as transportation and competing family priorities was addressed by the use of federal funds to support services delivered in schools. during the 2007-2008 school year, nine school-based health centers were operating and at least four more were in the planning stages. the advantages of the school settings are that first, it's not obvious that students are receiving mental health services. second, the transportation problem is solved. and third, the financial burden on the family is reduced because parents don't have to take time off from work and the services are offered at low or no cost. stigma can also be reduced by media campaigns, including the one run by fema and samsus crisis counseling program. we made recommendations to fema in february 2008 to improve this program by revising its reimbursement policy to pay for indirect costs as it does for other post-disaster response

grant programs, and by determining what types of expanded crisis counseling services should be incorporated into ccp. expanded services would provide more intensive services, especially in the aftermath of a disaster when provider availability can be limited. and fema and samsa have allowed the states to develop pilot programs along these lines. the department concurred with our recommendations but has not yet implemented them. fema also recently concurred with additional recommendations we made to expedite and improve the effectiveness of its case management services. taking these actions expeditiously before the next disaster would improve services for children and their families as well as for all adults. that concludes my remarks. >> thank you very much. i would like to call attention before i get into the questions to two charts that i think are very telling. first is to my left, your right,

and you'll see the green lines or bars are mental health resources in new orleans in august of 2005. so starting from the left, emergency rooms in new orleans, nine, psychiatric beds in new orleans, 350, psychiatric beds in greater new orleans, 668, and then physicians in new orleans, 617, psychiatrists in new orleans is the next bar, 196, and number of doctors, new orleans doctors participating in medicaid, 400. now, when you go to the orange, which is two years after the storm, two years, you would think you would be sort of well on your way to recovery, two years after the storm. we are going into the fourth year but in two years, in 2007,

instead of having 350 psychiatric beds, we had 77. instead of 617 physicians in new orleans, we had 140. instead of 196 psychiatrists, we had 22. and instead of 400 doctors participating in medicaid, we had 100. now, just this one chart shows that there's something terribly wrong with the system of support at either the state, the state and the federal level for shoring up the core of mental health stability in a community. it's one thing to talk about you don't have access to mental health because of lack of funding. if you don't have the professionals to deliver the services, you could just start

with this chart and work backwards from there. you don't have &@ @ arrg this is the child care center situation as of august 2007. and there are a couple of pretty startling graphs here. again, this is two years after the storm. now, this is two years. people have hundreds of thousands of people have fled to houston, atlanta, they're trying to get back.

the year has passed, their neighborhood has finally been cleared of environmental concerns, they're coming back to try to build their life and this is what they find two years after the storm. the blue graph is the number of child care centers in the greater new orleans area that were open before katrina, 275. the green is the marker of august '07, is 100. in jefferson parrish that wasn't as affected, it was 197 and then it was i think down to 170. but this is interesting, very interesting to me, in st. bernard, which is the small little bars on the side. st. bernard was the parrish of 67,000 people that was virtually completely destroyed, only five homes survived in the whole entire parrish. before the storm, there were 26 day care centers in st. bernard

parrish, very tight-knit middle class, working class community. in two years later, after all of our combined efforts, which obviously weren't enough, they only had two day care centers open. two. in a parrish that was completely destroyed. now, my question would be if we're asking parents to return and rebuild their communities, how is it possible for parents to do that if they only have two day care centers in the whole parrish? what do they do? do they strap their children on their backs and gut their homes with their infants on their backs, or do they bring their children in and let them sit in the gutted home while the parents gut their homes and they can play in the dirt and the nails? i don't -- i'm not understanding how we think that the system that we have is appropriate. in any way, shape or form. so i could show you the

statistics four years out from a storm but this really grabbed me when i saw that after two years of all of our efforts, there were two day care centers open in st. bernard parrish. so my first question is to you, mr. fugate. what is fema focused on about providing safe places for children, whether it's schools or day care opportunities, while parents are struggling to rebuild their communities after a catastrophic disaster, and what would some of your comments be about what you've heard this morning? >> madam chairwoman, mark shriver, who currently chairs the commission on children and disasters, i think he was probably one of my first meetings after i was sworn in, and laid out the concerns and issues, many of which you have laid out, and asked the same question, what's fema going to do about it. the easy answer would have been is to put another box in there

and say we'll write a plan for children and that will satisfy everybody's concerns. however, i didn't think that was going to be real change. so as we talked with mark and we talked with members of the commission and we had an opportunity to go to one of the commission meetings, i kept asking, you know, we have historically looked at special populations as an afterthought. i said let's try something different. why don't we write plans for the community and quit writing plans for just one part of the community, the people that can pretty well take care of themselves and really look at what the needs of the community. as you point out, my experiences with the hurricanes, one of the first things we really pushed hard to do was to get things like the pre-k and schools open, and there were several reasons for that. one is we recognized distressed children were going and that we did not have the resiliency in the mental health community because they were impacted like the rest of the facilities.

all three hospitals in charlotte county were shut down. we knew if we could get schools open, we could bring counselors to the schools and start working with children. it wasn't that we wanted schools back to normal. we just wanted to get them open to get children back into an environment that would get them into a routine that would both get them a chance to start dealing with this but also give their parents a chance to deal with what had happened, with their children somewhere safe. the challenge has always been when you get to day care that it depends upon states and localities but that can be a quasi state function, local function or private investor owned and the stafford act again historically has been looking at what government's responsibilities have been when you look at reimbursement programs. so we're working with the commission and their report, we're seeing we don't have time for the report. as soon as you guys have identified this, how do we go back in fema and look at stafford act, look at grants, look at program guidance, look at training, to start encouraging and recognizing that children from in the home as we

look at, again, you cannot just do one for all children. you have to really look at them developmentally from infants up through a certain age and different grades, how do we change what we've been doing so that if disaster strikes in the future, we're addressing these issues. >> i appreciate that comprehensive look and i think it's important, but issues, it brings me to your other point when you said fema is a partner in this effort. yes, i do believe that fema is a partner but i would say that fema is the leader. fema should be the experts on disaster, with your federal -- other federal partners. fema should be the driver. fema should be the motivator, the communicator. i look at fema and homeland security as not being the only entity that responds after a disaster but being the lead entity that helps to coordinate and manage your other federal partners, gives guidance to your state and local partners,

provides technical assistance and support to the private sector, but i wouldn't just say that fema is just any old partner. fema is the lead. number two, when we talk about day care centers, part of this is you're right, some of them are nonprofit, some of them are government operated and run, some of them are nonprofit, and some of them are for-profit but a good plan that would make sure that head start teachers and early childhood education teachers and counselors are part of that first responder team coming back for rebuilding, loans from the small business administration to make sure that these day care centers can get the loans they need, and think about how difficult it is for a for-profit day care center operator under our current laws

and current requirements to get a $200,000 loan to reopen a day care center. any bank or even under any regular system would look at her and say why are you opening a day care center, there are no children in your parrish. she says well, we will never have children in my parrish unless i open and provide a space for them. but she's not or he's not, whoever's running the center, not deemed credit-worthy or their business plan is quote, not viable. well, that is true on its face but that is where the federal government has to step up and say under normal circumstances, you wouldn't lend this person $200,000 to open a day care center where there are no children, but under this plan, under a disaster response plan, we are going to require you basically to lend the money at a lower interest rate and extend out the repayment, or if you don't get a day care center back in this parrish, you're not going to have a parrish back

because there has to be safe places for children in order for parents to return. i will submit another thing that's all interconnected. i think, mr. fugate, you hit the nail on the head, but when we're trying to encourage doctors to come back, we have lost many doctors. we think of them as doctors. we don't think of them as parents. most of them are probably parents with children. they can't come back if there's not a day care center or school for their children. so all of our efforts to rebuild our community are really spinning our wheels if that plan as you said, mr. fugate, doesn't have at its essence rebuilding safe places for children, which represent not only a special population but a central population to the families that we need to rebuild. i guess is my point. and i just think that has really been overlooked. i've got, they said there's been a vote that's called and unfortunately, because i'm here, by myself, i'm going to need to

probably call a two-minute recess and come back. but if the committee will stand just at recess for two minutes, i'm going to go vote, we'll come back. i have a few more questions for the final panelist a hearing now on children and disasters after a senate floor votes. live coverage on c-span 3. >> you heard the gao recommendation recommendations for fema to modify program rules to allow

reimbursement of costs when it comes to mental health counseling. how did you receive this recommendation? how do you plan to implement it? if not what dlou as an alternative? >> senator we received them favorably this is part of my rival. we have been working with hhs to go through the um mrementtation. we are getting to the point of finalizing those and sending those back out for final comment so we can go forward. we did receive these recommendations favorably. we are working to achieve that. and those are things that are still in process. but i think it goes back to earlier when i said we are part of the team. on behalf of the secretary and president, my job is to coordinate all the federal family when a governor request and receives disaster assistance, part of that is recognizing that subject matter expertise has to be a part of that response. that's what i was referring to.

i don't think fema has done a good job of understanding and working with partner agencies to leverage all their programs and we defaulted often times to the stafford act, which may be appropriate in some cases but does not build upon the existing expertise and programs already in the community. that's why we will use this children's working group to step back from our traditional fema-centric approach and look at all the fall family has and do a better john of leveraging those resources as a team so we know where the expertise is. where core competencies exist and with the program swres dealing with mental health issues, how we leverage the stafford act, so we are not having the locals and have go through and filling out who has got what but present a program that focuses on outcomes, particularly on the outcomes from children as the federal

family working under that authority that the president has invested in fema to support a governor in those jurisdictions. >> i agree with that. i think your analysis that it's ban fema-centric approach and has to change to fema leading the team, coordinating, being the link, and designing the programs not necessarily assuming responsibility to deliver them all, but to have them delivered through partnerships. one more question, then i have a few others. in november of 2005 i led the effort along with senator kennedy and senator enzi, and without the support of these two senators, i have to say publicly it never would have happened. but senator kennedy and senator enzi led a one-time unprecedented effort to establish a base -- basically a plan for the 300,000 children that had been displaced from the storm in the week of august 29th

which is approaching soon to try to find them a school somewhere in america where they could start school on a monday, the following monday because children that are out of school for two, three weeks sometimes have to skip a whole year. and under their extraordinary leadership this plan was implemented and basically provided vouchers for up to 300,000 children to attend school for that year. as a result, the katrina class graduated, many of them. this was one time, though. my question, mr. fugate, are you going to recommend a continuation of this plan? if so, how? if not, what plan is going to be put in place the next time a catastrophic disaster happens? >> again, that's some of the issues we want to raise with the children's working group. in florida, our experience was, we ended up with about 25,000

families that had come to florida. they weren't part of@@@@@@@@ rrr that's one thing we want to come back and go what is the mes mechanism, so if a state has children coming into their state or a jurisdiction has children coming in, how do we provide that assistance without -- >> i would suggest, respectfully suggest that you look at this program that seemed to work

amazingly well. again it was a very simple voucher program, up to $7,500, as i recall, where the cost of a catholic school tuition, whether children left a private school to go to public or public school to private or catholic because you have to have a program that snaps into place within the first week of the disaster, if it's a catastrophic disaster. it's obvious after a few days of analysis that there are no schools to come back to. you've got to have a button you press and this program operates. right now, as i understand it, though senator kennedy and senator enzi put this in place for katrina and rita, it was one time. and it's not in place today. so if another catastrophic disaster happens this summer in either texas, mississippi, alabama is hit and hundreds of thousands of children are

displaced, we have to start all over again and get an active congress to give people confidence that there is a back-up plan in the event that their school is destroyed. so i only raise this to say, in what while we have done a lot of talk and had some actions, there's so many other steps that need to be taken. one more question to goa, let me see here. the goa recently released another report, as you mentioned, on disaster case management programs. case managers are meant to help clients find job training, permanent housing, relief supplies, access to critical services, particularly after a disaster. case managers can be extremely helpful in trying to make sense of things, trying to identify the programs that are still operating and out there and making them real for clients. what, in your study, could you

share with us about the need for case managers? did we have enough on the ground? how did the case management program work generally? i think you testified to this. could you elaborate just a moment? >> yes, i can. overall, because of the chart that you showed here with the mu multip multiplycity of funding to figure out how families can put together the package of services that they need to stabilize and to, you know, regain their self-sufficiency. we had two major fundings, one was as we found in the mental health area, there was a significant lack of case management providers. and also limited referral services. this links back to the fact that if there are not enough providers in the area, there's nobody to refer people to. the other major concern was

sustainability of funding and breaks in funding. there was one situation in which a federal program was about to make a handoff to the state. the state program wasn't up and running yet so there's about a two-month gap in case management services when families were unable to access anything at all. >> whatsoever. >> that's correct. >> i also understand that catholic charities stepped forward which is a reputable and capable non-profit and provided case management but under the current law they were not allowed to recoup indirect costs. so as a result they were basically losing money as a non-profit trying to deliver services for the federal and state government. is that your understanding? >> i'm not sure i have the details of the situation you're describing. i do know that catholic charities had dropped out as a provider for crisis counseling services because they were not

able to recoup indirect costs. this was part of the basis for our regulation to expedite that reimbursement under fema's rules. >> okay. thank you all very much. i'm going to ask the second panel to come forward. i really appreciate your participation this morning and look forward to continuing to work with you. as the second panel comes forward to save time, let me begin to introduce them. our first witness will be mr. mark shriver who served as the first chair on the national commission of children and dasters das disasters in 2008. the commission is asked to examine childrens needs as they relate to all hazards and evaluate existing laws, regulations, policies and programs relevant to the needs of children during and after a

disaster. he's also vice president and managing director for u.s. programs save the children. he served as a member of the maryland house of delegates and is not new to this subject or to his leadership. we're pleased and honored to have mr. shriver with us today. dr. redlinger is a president and co-founder of the children's health fund, which works to educate the general public about the needs and barriers to health care. i want to say on a personal note he really stepped up after katrina and rita working through senator clinton's office at the time to give support and encouragement to us along the gulf coast. we're grateful, doctor for your help and support. finally, ms. terry fontenot of women's hospital in baton rouge. she assumed the position in 1996 after serving as health care finance operations executive in

louisiana and florida. she chairs the louisiana hospital association professional and general liability trust and is leading one of the finest hops in my view in louisiana that serves as a expertise in birthing and maternity for 8,500 children every year and is the designated hospital in louisiana to be the leader in disaster preparedness and response for this neonate group which is a very special group of infants that we need to keep our attention to during a disaster. let's start, mr. shriver with you. thank you very much. >> thank you very much, madam chair, for hosting this hearing and for your interest in this issue. i submitted a longer report, frankly you said most of the things i was interested in saying and points to try to get across. just for the record, i'm mark

shriv shriver, vice president and managing director for save the children. i want to summarize and say a couple quick facts. the bottom line is children are 25% of the population. yet this federal government and state governments and really all across the board we have spent more time and energy and money focusing on the needs of pets in disaster planning, response than we have on kids. 25% of the population received less time and focus and resources than pets. i think that for this country n this situation, that's absolutely outrageous. kids, as we all know and as you have eloquently said are lumped under at risk and special needs populations. as mr. fugate just said what he is proposing to do at fema through the efforts over there

are an exciting first step in the right direction to address children's needs in a comprehensive and effective manner rather than just creating window dressing, as he already said. a little background on the commission. we had our first meeting last year, our interim report is due in october of this year. final report is due to the congress and president in 2010. we had a field hearing in baton rouge where dr. redlinger joined me down there. we engaged a large community of entities to gather information, try to assess whether there are gaps in services, and those folks are not just federal government or state and local government but non-profits as well. i do want to comment again, what administrator fugate started at fema is very excited. i want to say a couple quick words on child care. you have already had the save the children report up. there but the issues critically

important not just from a kid's perspective, which, obviously, i think is paramount but the fact is that following a disaster, if you don't have child care facilities you have a loss of economic opportunity as you eloquently stated it. save the children's disaster decade report which is up there, shows only 7 states meet the basic requirements for licensed child care providers to have basic written emergency plans in place addressing evacuation and accommodating children with special needs. seven states in this country have the basic minimums in place. that, too, i think is absolutely outrageous and should be addressed and can be addressed through federal legislation. some steps we are proposing are in my written statement,ed in dam chair. i will just highlight a couple of them. mr. fugate talked about the stafford act and saying child care can be deemed an essential service. we are supportive of this concept. we think that funding is

necessary for the establishment of temporary emergency child care and recovery of child care infrastructure. the child care development books are being authorized. we propose during that reauthorization that state child care plans have guidelines for state operating child care after a disaster, and that states also are required to have child care providers with comprehensive all-hazard plans that incorporate shelter in place, evacuation relocation, family reunification, staff training, continuity of services and accommodation of children with special needs. the federal government has the responsibility to put these into place and we encourage to you look into that. i know time is of the essence, so i will just wrap up by saying that a lot of the ideas that you and your staff have been working on and mentioned today are

critically important. i would only encourage you as the chair of this commission and as a member of the non-profit community to follow up, follow up, and follow up again. you don't hold everyone's feet to the fire. kids because they don't vote and particularly poor kids are not actively engaged in the political process. you are their voice. if you do not stand up and your staff doesn't follow up diligently with all levels of the government they l unfortunately, suffer from benign negligent, which david paulson has told me is the modus operandi in the past. and i don't think that's the way this country should be reacting to poor children across the country. >> thank you, appreciate it i want to note for the record that commissioner fugate, administrator fugate has stayed for the second panel. i would like that to be noted. it's important to me that he didn't testify and leave but is testifying to stay and hear

these comments. doctor? >> thanks, madam chair. i want to echo our great appreciation for you holding these hearings and learning more about this terribly difficult problem we're facing. i'm a pediatrician. president of the children's health fund but also director of the national center for disaster preparedness at columbia university and have the honor of serving on the national commission, chair there the subcommittee on human services recovery. by way of background, shortly after hurricane katrina and working with local officials, we dispatched seven mobile pediatric clinics and teams to the gulf to provide acute medical and mental health care for those people and those are still there, affiliated with tulane and other institutions. to date, we have seen over 60,000 health and mental health encounters in children. in addition to that, the

national center, my center has conducted long-term periodic interviews with a cohort of 1,000 families. i want to summarize a couple key points out of many, many that i think are germane to discussions today. this comes from our clinical information and studies. more than 3 in 5 parents have feld over time that their general situation currently is either uncertain or significantly worse than it was before katrina. secondly, approximately one-third of this displaced children are at least one year older than appropriate for their grade level in school. third, according to interviewed parents, more than two-thirds of children displaced by the hurricanes are experiencing emotional or behavioral problems as we speak. in a study last fall of our program in baton rouge, 41% of children were found to have iron deaf fish shentcy ameanya, and 55% reported to have behavior or learning difficulties.

as far as the overall learning situation for children, the number of die)m)%&aá@ @ @ @ @ å rescue has been more mishandled than the initial response to the disaster. the persistence of trauma and profound disruption to children have been far more insidious and invisible. the failures of recovery have lost the attention of the media,

for the most part the public and i'm sorry to say perhaps many in government as well. the basic concept of long-term recovery is fraught with confusion and lack of leadership on every level. there's a lack of clarity by what we mean by the term recovery. ma that is are we talking about rebuilding physical environment other working to help families reestablish conditions of normal life? though a national disaster recovery strategy was mandated under the post-katrina emergency management reform act of 2006 that strategy has yet to appear that said i believe that under new and highly motivated and capability leadership at dhs, fema and hhs, we are hopeful we may soon see the emergence of this critical road map. there's been no apparent recognition that the needs of children must be understood and absorbed in this response planning, mitigation and recovery. we think this is changing as mark was pointing out. perhaps most egregious of all,

there's a growing sense, and i consider it a monumental misunderstanding, that recovery from large-scale disasters is a local problem to be solved and managed by states and local jurisdictions. but the destruction we saw in the gulf and the flooding of new orleans was and remains a national problem. the well-being of the effected states is highly material to the well-being, economy and security of the united states. so i want to conclude with a few general recommendations, then a couple of points to emphasize what mark was saying about children. in general, i have dozens of these, let me hit three. >> take another minute or two. appreciate it. >> the national disaster recovery strategy must be completed as rapidly as possible and preferably, were i you, i would ask for this by the end of this calendar year. there's no reason that needs to be delayed any more than that. if we don't have that we'll

still be flailing around trying to understand who is doing what for whom. secondly, i would strongly recommend a high level directorate reporting to the president that needs to be established to oversee and coordinate all relevantal from assets and age swiss respect to long-term recovery. revitalizing and sustaining and protecting the needs of children and families during this difficult transition. thirdly, recovery must be seen as responding at every level to these human services needs during the recovery transition and we'd like to see how this national recovery strategy actually addresses that. and then some of the other issues around children, which are -- which represent, to me, the most dangerous problem that we're facing now, because, as i said before, the problems will not be sometimes at all reversible. children lose a year or two at school cannot be recaptured in

terms of their economic success. emotional problems rooted in four years of trauma -- we think it will take another two years to get everybody housed if we have housing available, those children we ignore at their peril and our peril. so i have been thrilled to be on the national commission with mark. and here's a couple things i would point out. the national recovery strategy, when it develops should have an emphases on safe guarding the health, mental health and academic success of displaced children this addresses the point is, you raised before. it cannot be ad hoc it has to be part of our basic understanding about how we deal with recovery. for this disaster and anything else that happens in the future. maybe a storm in the gulf it could be terrorism in new york. it could be an earthquake in san francisco. we don't want to be redoing this. we need that road map. secondly, the federal government must ensure -- assure a robust uniform and accountable case management program for every child displaced by a major

disaster. i don't have time to go into it, but i had to medicate myself just to absorb the complexity and dysfunctionality of what our country called the case management in the aftermath of this disaster. it's shameful. thirdly i would say the health, dental and mental health service force every displaced child should be assured under a medical home comprehensive care model this is because somebody has to take responsibility for not permitting children to fall through the cracks. they can't afford the delays and interrep shuns in their safety net. i think i'll leave it at that and respond to any questions. burr our profound gratitude to you, senator, for taking and keeping the leadership on this vital issue. >> thank you, dr. ms. fontenot? >> it's a privilege toe come before you today to describe our hospital's response to the evacuation of critically ill patients in the aftermath of

katrina, our preparations for reit tax gustav and ike, the important lessons learned and our recommendations. women's hospital is 70 miles northwest of new orleans and a two-hour drive from the gulf coast. hospitals are usually a place of refuge rather than a complex evacuation site, so the need to evacuate one or a whole city had not been considered. but in katrina, women's hospital did just that. working with our colleagues in new orleans under unfathomable conditions, not one transferred baby or mother died. unquestionably this remarkable achievement was the result of dedication and hard work by thousands of people, not because of carefully crafted and effective planning. blackhawk helicopters brought men, women and children day and night to our hospital. we received, stabilized and transferred many patients to other facilities. the most critically ill infants

and women remained. for a month after katrina we cared for twice the number of critically ill infants and delivered 150 babies. for several day there's were 125 infants in our 82 bassinet and neonatal care unit. we provided care for over 1,100 patients and provided shelters for 110 newly delivered mothers and families because they were rejected at government-run and red cross shelters. what began as a rescue became a response to their overwhelming needs beyond medical care. this feat was successful because of our incredibly dedicated staff, an expansion to our neonatal care unit completed just weeks before katrina, and a drill held in 2005 that yielded valuable information. the rescue was adequate, the coordinated planning by all agencies involved could have vastly improved their response. hurricane rita came three weeks after katrina. for rita and each storm since

that time, flee neonates and high-risk women were evacuated before the storm. a plan was produced for emergency management of neonates. we contacted neighboring states to discuss evacuation, especially if baton rouge became a disaster site since no other hospital in our state has the capacity to take a large number of patients. we took part in research with tulane university to study the effects of the storms, and we are the officially designated provider for louisiana medical institution evacuation plan. we are committed to anything and everything that will prevent the chaos of katrina. hospitals in louisiana strengthened their infrastructure and plan to shelter and place with the notable exception of especially fragile patients, those hospitals depend on us to transport and care for patients. women's hospital performance

after katrina demonstrate an expert organization with adequate capacity is critical for the emergency management of certain populations of fragile patients. the expert hospital is the coordinator of care and has capacity to care for displaced infants. named operation smart move it's an initiative to ensure infants and mothers have a safe place as well as network of care and services. a remarkable opportunity exists to further implement these concepts as we build a replacement hospital. search capability was included but was removed due to the high interest rates on tax-exempt debt and deep medicaid cuts to hospitals. search capacity is now unaffordable for us and most hospitals even though the hospitals in louisiana counted on us three times in four years to fulfill this need. the cost for hospitals to be ready at all times is critical. the relocation of our hospital to a new campus will provide a

unique learning opportunity. representatives from hospitals like women's from across the nation will participate in a real time evacuation drill as our nic unit is moved from one campus to the other. private organizations will qualify for associated costs of that evacuation. your concern about the impact of disasters on children is appropriate and important. on behalf of the staff of women's hospital we are excited to share our experience and knowledge in response to the care of our most vulnerable citizens. thachg you for your ongoing support and the opportunity to speak today. i look forward to answering any questions. thank you. >> thank you very much. terry, we appreciate your leadership. you continue to make this senator very proud of the work that you're doing.

we'll only have one question for each of you because of our time limitations. let me, ms. fontenot start with you. if you could restate two points for the record. one, despite the fact that your hospital did such extraordinary work in the storm, could you say again for the record what the current law allows you to get in terms of reimbursement? i understand you're a private facility so therefore basically out of -- while the government depended on to you help in so many ways, through not in line for any reimbursement for. you could explain that. >> my understanding is because we are not a governmental agency, that we are not able to receive funds directly from fema, that we have to have a contract with the state for any type of service that we provide and it goes through state as fiscal intermediary. >> okay. could you say -- talk a minute about the surge ka passcy issue?

as we debate the health care bill and how we may reshape the health care delivery system for the country, i think this would be important. so, again, if you could comment about the lack of surge capacity. >> thank you. most hospitals are faced with cuts because of inadequate reimbursement, particularly medicaid, that is the primary payer for children, particularly infants. 60% of the babies in our nicu are covered by medicaid, two-thirds of the deliveries in our state are covered by medicaid. whenever there are medicaid cuts as there have been just announced this week in louisiana, hospitals are not able to provide the financial support for additional bedses to be on stand by or equipment or supplies or planning or any of those things. any reimburse. they receive has to go directly for the core medical services, that's taking care of those babies that are in the hospital that day without being able to

have anything on the side so that we acan -- it's very expensive to have the planning and drills and that sort of thing. >> thank you very much. mr. shriver, let me ask you, if you could sum up, besides your excellent recommendation that a strategy be enacted by the end of the year and a requirement put down to receive that strategy, and that the child block grants not be reinstated without the requirement that states step up to at least have evacuation reunification, special needs and written procedure force disaster planning, are there one or two other specific suggestions that you would like to mention that you think from your study and review should be really at the top of our list to address in the next few weeks and months? >> i think, as dr. redrener mentioned, coming up with a

national framework for recovery is important. i think, honestly, senator, if you look at the child care development block grant and can put those requirements in there you come up with a recovery framework within the next five and a half months, and you have all child care facilities in this country looking at the issue of reunification, evacuation plan, making sure the children with special needs, their needs are incorporated into their planning, that that is tied in with the local emergency management community, i would consider that a hugely successful 5 1/2 ponts. i think that would be fantastic. i think the issue of -- that administrator fugate talked about, regarding the stafford act and having those child care facilities be reimbursed, i knows there some int tra kacys involved in that, if you can address that issue and come up with recommendations and funding for that, i think that would be hugely successful.

i think frankly if you@@@@@@girr the next 5 1/2 to 6 months highly successful as well. >> thank you very much. we will do so. doctor, you said that the case management was -- i think you would say, i'm putting these words in your mouth, you would hardly call it case management. it was not really managing much of anything.

so fragmented, unable to deliver in a timely, appropriate way. when we think about creating a new kind of system, i've read in some of your testimony and other recommendations that part of the delivery system might be done through the schools as they start up in terms of school-based counseling services. do you want to comment about the preference for that? or should there be opportunities community-wide? what is it about school-based counseling that you think is particularly desirable? >> well, first of all, we have to have a system that makes sure every child who is school-aged is in school and kids in pre-school age are in appropriate day care facilities. so the school can be -- and the related institutions could become the basis of stability for lots of families, especially lots of children. from that point of view, if we could have services emulating out of that model, so every child is in school, every child

has a family and that it's possible to think about a system that would mandate not only the kids being in school but that appropriate safety net programs and assistance for the families be generated by that relationship as well. i would say -- want to say one other word about the case management issues. there were lots of good people doing case management in the gulf and still are catholic charities, the other organizations that are down there that are governmental and nongovernmental. the problem is that it's so fragmented and disorganized and competing case management programs that many, many families are just slipping through the cracks. so i just want to clarify that lots of good work was done, just far too many -- getting the numbers that i cited, 17,000 to 30,000 was one of the most difficult challenges i've had in research in 20 years because there is not a single agency that feels itself is responsible

for tracking these families who have been displaced. if you start with that, you have an inability to even figure out how many or where they are. we beg them this is fema, and the state, to make sure that no families were discharged from those horrendous trailer parks before we knew where they -- who they were and where they were going so we could provide services to them. but all sorts of bureaucratic snafus between the federal government, state government and then the private agencies delivering services yielded, a, one of the largest case management systems never got implemented. not one dime out of the original 33 million was spent until recently. secondly, we couldn't track families. we had no idea where they are i don't know where all those kids are that you cited that were part of the evacuees. i would challenge the federal government to try to figure out where are they? how many are in houston mobile, alabama, so forth? how many are still struggling in

limbo in displacement conditions that are really, really hurting these children and their opportunity for success. >> thank you so much. i would like to close with a couple of comments. one, the louisiana family corporation, recovery corporation, i understand delivered some very good work. >> they did. >> unfortunately their contract was not able to be renewed, and i hope that they can be called in for comments as we try to come up with a better system. my final comment is my own personal experience, not only in my own family experience recovering from the disaster as you all know i'm one of nine siblings, and four of my brothers and sisters lost their homes, their children were displaced. watching it up close and personal within my own family, and then expanding that out to our own neighborhood, broadmor, which was destroyed, out to the

community. i have concluded one thing that i know without reading one report -- that schools became the center of life when those neighborhoods were struggling to come back. whether it was st. dominic's or holy cross or wilson public school that is getting ready to open or lusher that opened, it became the only stable place, building, in a anybodihood completely destroyed. the government at its own peril fails to recognize the importance of these schools. it brought stability to the life of parents that otherwise had no stability. they needed to turn from just schools to community centers that provide counseling, medical support, particularly when your hospitals are closed, getting your schools open, getting children back in touch with their teachers, which is a familiar face at that moment is very significant to children

that have had such trauma. i can't overestimate and overstate how important this is. and the federal government that doesn't recognize the importance of schools, be they public, private, catholic or independent, and the ability of schools to be sort of step in the gap until the rest of the community comes back, i think is kind of the model that i see. and the celebration of joy that when a school would open in a neighborhood, what it meant to that community cannot be overestimated. so i'd like to end with that. we have a great of deal before us. this record will stay open for 15 days. please, anyone can submit to the