aarp's president. on behalf of aarp is more than 37 million members can we thank you for holding this hearing on the medicare part d prescription drug program. as we approach the 10th anniversary of medicaid modernization act, part d is helping millions of medicare beneficiaries afford the prescription drugs they need. ..

>> last year's seal it knowledge taking medications help prevent hospital emissions and reduces the use of other medical services. this shows the importance of part d to control spending and critically offers a path to controlling costs throughout the entire health care system. among those important -- to pour in productions of part d is the low-income subsidy for those who are least able to afford their drugs. amid the successes of part d we see opportunities to improve the program. our beneficiaries still tell us they continued to struggle to afford prescriptions.

to be eligible for the low-income subsidy in 2013, beneficiaries cannot have $1 more than $13,300 in savings. this is hardly enough to get to the years of retirement this is why we have consistently opposed it. also recent modifications to of co-payments may be premature instead we recommend for the research and to understand what is driving utilization to ensure that any changes would not interfere to access the necessary drugs. also part d and wrote long dash enrollees have drug sharing as the plants get more complex for preferred and on preferred brand name drugs. further, aarp does not support making enrollees pay higher premiums based on

income. seniors have already paid into the system through payroll taxes in those with higher incomes already paid more over their lifetime. in many cases they are still working and continue to pay medicare taxes often because they do not have the savings they need to retire. aarp is concerned those will not participate in part d changing the nature and quality of the program. we do recognize we must take steps rather than requiring them to pay more. that is why we support the act that provides rebates for low-income beneficiaries and dual eligible for medicare/medicaid in this would restore the savings they had prior to the

enactment of them and say this would be estimated to save one of the $41 billion over the next and here's. record to working with all members to enact fiscal stability and stabilization while protecting beneficiaries. we also consistently supported legislation to enable the secretary of hhs to use the bargaining power of medicare 49 million beneficiaries to negotiate lower drug prices. further reason for reducing market exclusivity from 12 to seven years of this could save billions for beneficiaries and the medicare program for employers. in conclusion we should focus on efforts to hold down costs cannot shift cost in the form of higher premiums or co-payments. we'll afford to working with members of congress double sides of the aisle to

improve part d to find ways to keep drug coverage affordable. thank you very much. >> sage que to all of you. we will get into questions and it will help to flash saugh one negative out since we did not make the opening statement setting the table for the discussion to do. i will defer all questions and tell our colleagues have asked there's senator colin spending keogh. let me begin by commending you for holding this series of hearings as lee approached the tenth anniversary of medicare modernization act of 2003 i was proud to vote for that legislation and i will go on a limb and say it is the

only intact and a program in history where the actual experience has produced much lower cost for the government and the beneficiaries and was initially estimated. usually it goes the other way when we created to benefit. so that is good news indeed as is the high satisfaction rate. nevertheless, there are some important issues we need to explore as we approach the tenth year of this program. ms. woerner i was interested to hear your experience in counseling beneficiaries. many part d plans now use medication utilization management tools, such as prior authorization, and medication substitution, '04

quantity limits that restrict the beneficiaries to act as to prescription drugs. i heard concerns from my constituents that some drug plans have a policy where a beneficiary may be prescribed a more expensive medication by first pass to use a lower cost drug or a plan preferred medication and actually the failure of that medication before they are allowed to use the medication doctor wanted to prescribe in the first place. i know of an elderly woman who had the experience of having side effects from a drug that was the lower cost

drug and had that terrible cough and for one month and when she was able to switch to the drug that her doctor originally prescribed she was fine. is this common in your experience and do you have any suggestions? i will ask all of you how to strike the right balance to make sure that plans to have the ability to legitimately control costs and yet not put our seniors tour a situation where they have to experience the failure of a drug before they can get the drug their doctor knew was the preferred medication in the first place. >> you have it exactly right. we get many, many calls from

people who have gone through that process. the doctor has prescribed a drug and the plan says before we will cover that drug, you must try to or three other drugs. very often the caller will tell me i have tried those drugs and i had a terrible rash when i got back zero or terrible intestinal problem or they have already been through those. but in order to convince the planned, they need to get documentation from the doctors who prescribe those earlier medications and it is not always possible or easy to do. i would say that is a very

common problem among the callers that we get. i am not sure i have the ability to answer the question of how to improve the lot of these people that really need the drug that the doctor has prescribed and still have cost containment issues. >> let me ask the rest of the panel, it is very good to have you verify you get those kinds of calls that my office gets and we have got in and even when the physician has written a letter saying the person needs this particular drug. why don't die quickly go down the panel. >> yes, there are some

potential things you could do in one is to understand how often it happens. we know depending on the drug's the limits apply to but we don't know how many people run into these issues in a simple way or in a way that is more complicated that takes more steps to resolve. somewhere information is better. plans could be forced to target the measures better. some cases it is appropriate for safety issues and in other situations the measures are appropriate but if plans targeted with a more select set of drugs that would help. also clear and simple that what people go through this to appeal this but when you hear the same thing from doctors the paperwork involved to request authorization or exception or document the therapy is a

burden on doctors. my last comment goes to the point* you have already tried that drug before and a better message do track this than one specific area is a person moves from plan eight to plan b. the information that they have tried should be carried over. if somebody is new to the program then it you have to involve the doctor but a better way to carry the history for word with the electronic tools we have the ability to do that that we did not in the past but there are not easy or simple solution. >> i think there is a real opportunity to improve the situation by bringing along information as individuals and that is something we supported it also has an

opportunity to look get utilization to see if there other issues and that is a step forward for the beneficiaries. i will also note cms has looked at some plans and it indicated that there are instances they are overdoing it and we don't want to see that there is plenty of leeway without overdoing its. and it may be we should be looking more to identify their plans federal liars or that we see a particular plan of problems and finally and quite honestly i am thinking out loud maybe we should say in some instances may be the presumption should be in favor of the beneficiary so they don't have to fail first but then on wind later on. >> my time has expired but i

will ask for the record if you will provide me with aarp, thank you. mr. romasco. >> we hear here is transparency, affordability and the primacy of the relationship between the doctor and patient. my personal experience the doctor knows what i need but i have done before, the only thing i would add as they make good judgments based on the total cost and impact. they make a good judgment what is best medical a combined with the cost side think those in combination what my fellow panelists would do would improve this is to ration. >> thank you. >> senator boren. >> senator we appreciate you for having this hearing it for you to be here.

with cms 90% of traditional medicare spending goes to care and beneficiaries as multiple or chronic conditions. prescription drugs are clearly of vital part of their care to manage successfully chronic diseases thanks in part to the a private investment and innovation of the pharmaceutical and biotechnology industry. but unfortunately just because a drug is prescribed doesn't mean it is actually taken according to the terms of the prescription. of this matters when we try to get better out comes out lower cost across the health care system. you alluded to the steady mr. smith, patients with high risk of cardiovascular disease that it's a cholesterol lowering drug had about 35% fewer hospitalizations compared

with those who do that that is a remarkable difference. and the new cbo study shows the increased prescription drug use actually reduces the cost of other health care services. so one important way to improve drug use is suze therapy management program that you spoke about. medicare part d plans require these programs for seniors in those with multiple chronic conditions to help with the medication regiment hopefully increasing the parents to for those that are taken and effectively but how can we improve medication therapy management programs and if there are other evidence based strategies that we might employ a for them to take prescription medications?

i will start with you on that mr. smith. >> this is an area that has tremendous potential. one area of health care where you can say we can get the cost savings we won with better outcomes for the beneficiary and you cannot argue with that. in terms of medication therapy programs but to publish the first study about the experience and found with part d ceo pd and congestive heart failure that medication therapy programs help to lower hospital cost with better quality care. the better results. >> let me interrupt it is a lower-cost because those are the two studies that they

felt that there were not lower costs. >> yes. i believe that is right. so a couple of points i will leave time for my colleagues but the thing queeney the lot more research to know more about what is going on with up medication program and what strategies work well and so there could be brodeur learning to take advantage of this opportunity. one thing that may re-read the on negative related wis synchronization. if they take 35 different and medications they have to go to the pharmacy to apply different times and if you get software to put it together they only have to go once then you see all of the together there is any

issues are contra indications you could take care of it so looking in strategies like that how it is working and behalf how it is important and also cms those who were contacted for management not taking a vantage of the opportunity offered. >> just a couple of thoughts i think everything mr. smith said it is worthy of that but the first barrier is to make sure you can afford the drug in the first place. and potentially to lower the cost. but do basically spread the lipper to or over 60 days unfortunately is too common.

basically if you take medication in the sixties under the health care plan the kid to it more likely when you retire because if you look that compliance issue how it encourages compliance so those two issues to make sure the cost is low enough that you could understand why they skip that when they know what is good for them. >> wooded the albright if i ask dr. hoadley quickly? >> with the comments i heard of affordability and we need to know more about what the plans are doing and we're starting to put that record together also cms includes with the star ratings systems it could be a tool with the ability to do this

also the consumer could say it has a better track record and i think there are some solutions that could play a role and the synchronization that was talked about but also to take the medication so if you are a person with those multiple chronic conditions with four or five steps to take and business on an empty stomach but to help that patients may be the role the pharmacist for the nurses could play as a team to help the person figure out what is the right way to have the medications throughout the day. running into more disability program it is intimidating did i already take that? how can we provide more tools to help people to get them lined up and then to

build some assistance. >> very thoughtful and i amount of time but anything you'd like to add. >> we do not talk about being in such programs it that a note that means. >> that is a good point*. we have some great ideas so we could get better outcomes out lower-cost. thank you. >> want to underscore what mr. romasco said that cost is still a major barrier. it is not unusual in florida a senior fortunately, it doesn't happen very often but a senior is making a choice between their medicine and food and fat should not be in america in the year 2013.

senator? >> no one to think the chairman and ranking member to have this but i wanted to ask mr. smith and anyone on the panel the affordable care act with the advisory board it was unique in the structure to overturn it's not how we just pass recommendation but that a majority of the people making the decisions would impact payments providers and also impact were recipients would receive common those individuals can be involved to treat patients to provide health care services to

beneficiaries. but those who make the decisions for what we are covered by have heard from many physicians and provider groups that they are concerned how it would impact the senior care and over this past month 500 organizations including several from new hampshire represent a diverse sector of the health care industry, small and large urging us to eliminate i pass. also from as i understand it i want to ask you why that is with ipab and what impact could ipab have on medicare part d and certainly i would open it to the other panelists to comment. >> i would start the you are correct we have expressed

serious concerns about ipab and many others across the health care system and i would say that starts that ipab without the usual balances from congress and i think that raises a lot of reasons for concern. i know the arguments or through the sorts of things that we were talking about. it is not because ipab is made up of shortsighted people but the reality is estimated spending target in the one-year time frame and quality improvement takes longer to have these types of savings than the cbo itself pointed out expect ipab to put out the maquettes and it will put

out and they are called out to be targeted. manipulating payment amounts in this fashion can of course, have significant effects on beneficiaries access to care. because we have a market-based system and part d mentioned affordability 84 percent of all prescriptions last year were dispensed with a co-pay of $10 or less and we have the market based system that has driven these kinds of results but i don't thank you will get that type of results from what has been created it will go the traditional way to significantly restrict access. >> by with just note that for the moment the low spending growth trend are

the triggers that are built into would make the deliberations necessary so maybe the observation it to make is if we maintain a track record to do things we have been talking about then that will help make the deliberations and necessary. >> so we wouldn't need ipab. >> but i want to make sure that one of the concerns is a super majority that is required. dr. woerner? thank-you mr. romasco? >> the real issue is the health care costs overall. we cannot get them to grow with the economic rate that is the problem so that is a

fail-safe mechanism and "this is it" is there in case and that it is worthy of consideration we need a mechanism that continues to focus on the 2.$7 trillion we're spending and if there grows too fast and effective >> i appreciate that but if it is there and you are concerned rightly so in terms of what is the care that people receive them want to make sure that fail-safe has accountabilities of decisions are made congress can correct them with their normal course. i am a supporter of ending its but i do appreciate all of you coming here today and thank you for the work you're doing with medicare part d. bless you. >> mr. chairman thank you for timely leadership this is an important time to look

back and it is so great to have that dr. woerner i remember when we had archer on speed dial for all she did for the seniors. recalling just for a minute the ferocious debate that took place when this legislation was first considered but i think you have to start with the proposition that at that time the level of desperation among seniors for some measure of assistance was just extraordinary. at the time, it really felt this debate had gone on for eons and i remember back in the days we were talking about this very issue. and i came to the conclusion

we were at a fork in the road and that if we didn't take the opportunity to at least get started, it would be eons more before we got the effort under way i remember talking with senator kennedy who worked for this for years so i voted for the legislation. and the welts on my back and took a couple of years to heal but the reality is at least we got it started and we have been able to help a lot of people. and dr. woerner your points are spot on and i just want to ask a couple of questions. . .

>> so we are holding on the cost of the specialty drugs for seniors. >> there is a particular problem with specialty drugs for people who are of the lower income.

what happens is that for other medications, if the doctor prescribes a particular medication that is in a higher tier, not specialty care, the client can appeal to lower this price of the tier. if there is not other drugs that can be replacing it. specialty drugs do not have that. we have many who have needed specialty drugs for conditions like multiple sclerosis. they can't appeal to the company

because they are low income. one woman i recall was living on about $1700 of social security income. she was above the level for the extra help of low income subsidies. that is not a lot of income. we have food and everything else. the first thing would be to allow a process of the same kind of appeal that you have. >> that sounds too logical for washington. let us work with all of you. i want to i can get one other

response. in regards to disease and medicine, i would like to get one other common in. >> in regards to moving forward? >> yes. wes picking up where i left off right now you have to have all these expenditures. and in practice come you have to be taking a lot of different medicines. there are people who are nonadherent, they are not taking their medicine, they have the level of drug expenditures that triggers this.

rather than zeroing in the way we did some i think we have a lot of opportunity to make progress by going these routes. >> my time has expired and i hope that all of you are advocates. i hope that we start to factor in that these drugs affect people differently. for years and years, this is important in the area of chronic disease were senator warren has made an important focus point. in relation to patient management and individuals. to do that right, we are going to need to know more about the differential treatment of medicines for different people. what is really sort of be done with personalized medicine where there is going to have to be a lot more work. senator, thank you for all the leadership. >> thank you, senator.

thank you for bringing it up, the appeals process. thank you for doctor warner's excellent response. to give you an example, the lady in florida -- when her drug for a brain tumor and she had no appeal process, it went from $30 a month to $650 per month. obviously there is a need if any of the remaining three of you to a comment on this process. >> senator, i fully agree with the points made on this. i am in support of treating the specialty tier as the way that the other tiers are treated for this purpose. >> okay, let's move onto another subject.

mr. smith. you heard the gentleman say that the very same drugs that medicare used to pay for, when the prescription drugs and legislation was passed in 2003, because those people that had been receiving their drugs under medicare are over age 65, they get their drugs for medicare. now, the price of that the u.s. government is paying is not the same. it is not the same to the degree of the statement that cost the u.s. taxpayer over 10 years and additional $147 billion.

i appreciate the opportunity to respond as well. we advocated aggressively for moving a few audibles of medicaid and medicare. i think that we also have something in comparison there

are actuaries -- the cms actuary estimated at just over six years ago, not the usual what we are used to, it comes at a cost to the industry of about $30 billion. so over 10 years, it is going to be the or 60 billion. 30 billion going into the medicare trust fund that is paid by the industry. so i think that taking medicaid over here and taking over only part of medicare and looking at the totality of medicare, it does create an apples and oranges effect. i will finally add that we have had strong and powerful purchasers to drive savings. we do drive savings. the part d medicare costs for 2012 or 54% lower than was projected in 2004 after the program passed. medicare as a whole has

increased. so medicare deserves fair prices, good prices, savings. that is why the cbo has not $100 billion off the price. this is when you talk about in regards to the innovative capacity. >> i want to say that i gave you an a for your response. if i were in your shoes, i would have like to have you respond as you do.

it doesn't cut it. it doesn't cut it when the u.s. government is, in fact, a big purchaser, what you talked about. >> in a competitive marketplace. the u.s. government also get that discounted veterans administration. the u.s. government also keeps that through the department of defense. so when we talk about the competitive marketplace we are

trying to get the biggest bang for the taxpayers buck. up until they get 64 years of age and in 364 days, but on the 365th day. they suddenly are eligible for the same drugs here the weight you can recognize this is the government will pick up more and more of the cost of doughnut hole has shrunk.

what you are industry is doing is absolutely fantastic area. in no way do we want to lessen the research and development. however, we are coming down to a basic question of dollars and cents. i, of course, took this on with the health care bill. and i have been beat in the senate finance committee. but this issue is not going to go away. you should face that. that is especially so over the course of the next seven years as the u.s. government picking up more and more.

sir, you aren't ready to say something, and then i'm going to turn to my colleague here. >> i could not support the concept more fully. the u.s. government is a huge purpose. much greater better than any of the individual insurance companies. it continues to baffle me. it is like telling wal-mart that they can't negotiate with doctor and gamble over the cost of tide. it just doesn't make sense. the other example, and i think that mr. smith alluded to it. it's an important issue about research and development. it's a similar argument to pave the way for generic drugs. oftentimes the industry made the argument that this will stifle research and development. yet, through their ingenious market forces we now have a generic drug and everyone is prosperous, the industry has grown, and they have continued to be successful and profitable.

so i think that the concept is a critical idea and i think that lengthening and shortening the horizon from 12 to seven years is another possibility and accounts in the act of the legislation support -- it's another way of keeping our eye on the ball. not only with medicare, in the entire health care system. >> before i turn to the senator, senator collins, i wish the senator wyden were here. because going back on the history of all of this -- i mean, it is true that the prescription drug and if it's were first authorized and set up in 2003 in the prescription drug bill. there was another thing that was said about that time and it became very costly for the government. it was setting up a new delivery

of medicare to an insurance company. it was called medicare advantage. it was delivered through an hmo, which is in is an insurance company. what happened was there was a 14% bump per senior citizen in the fishery of medicare. that became so expensive that when the health care reform bill came along, we had to save medicare. because it was going bankrupt and one of the major reasons was the federal government was paying out too much to the insurance company. and that was over time through the health care bill. so in the history of this whole continuum here, we have seen one

overstepping. that is now being corrected. and there is such a significant increase to the taxpayer. including the drugs that are delivered through partly medicare. >> thank you, mr. chairman. i am going to follow up on this very interesting question and this is an issue i can see both sides. on the one hand, you look at the va system or government has you have been asked to negotiate prices and we have done it in the medicaid program. it wasn't as president obama, but the simpson-bowles

commission also had a recommendation, which gives it some credibility in my eyes. the other hand, you can certainly look at the marketplace and say that we have a thousand plans, there is lots of competition, and we have sophisticated insurers who are doing that kind of negotiation with very good results for the consumers since the prices are so much less her premiums spent than had been projected for government. i am truly of two minds about this. and also about which way is the better way to go. mr. smith, from your perspective, since you can legitimately point to a successful program that has

driven down prices with successful, sophisticated negotiators with these plans, why do we have it in medicaid and the d.a. program? >> thank you for that question, senator. the first point i would make we have statutory provisions we have set prices in those programs over the years we

expect that we will have the same effect if we extend that to medicare. extending these rules were smaller and programs that have exceptional circumstances, it would send a very negative single. it is easily affordable. i think that when i look at what mckinsey says about pharmaceuticals, in recent years we haven't been earning a return on investments. it echoes what mckinsey has to

say and i think that it is clear that we are at a point where this kind of policy would force choices. it is the industry as an economic driver. there is a broad-based effort by the community i think that we have heard today that there is a broad endorsement of how the

program is working for the seniors. second, i would note that many of those programs are very restrictive. they offer a broader range of medicine than the va. in fact, many veterans are also enrolled in medicare part be. they are getting think that they are not getting in the va. we have a range of issues. it hasn't been around hospitals, discussed around doctors, it has only been discussed around medicine.

isn't the american consumer really subsidizing this for the rest of the world? most countries do have control on medication. in a way, it is the american consumer that is paying for that. are we not? >> i think that the american consumer -- i actually think american consumers into paying for the costs as well. with significant restrictions or access to medicines. the global center of the

research sector, the through the 1980s and so forth, it was in europe. today, the u.s. greatly outweighs europe, and i think that we have government pricing controls that is a significant part of the case. i will note, finally that our market based system creates and they suppressed research and development and their use. at the same time, they pay about twice as much for generics. so instead of rewarding innovation, they actually suppress innovation and generics

are about 3% of our medicine spending in the united states. pushing down on green medicines is included as well. >> thank you. sir, just one final question. the reasons that the studies have shown that this is part d beneficiaries that don't choose the cheapest plan. especially to meet their needs. and one study found that on average, we spend $360 more each year.

why do you think is the president of aarp, what he think that is? we alluded to it earlier this evening. it gave us a complexity that is overwhelming. the human reaction is to avoid and stick to what you owe. >> with the survey shows is that 40% of the beneficiaries think that there are too many choices and it is confusing. the other 40% by cavanaugh's choices. >> i think the issue is, do we have the tools in place to help people make those choices? some of the suggestions that were made -- as i recall, you and the senator have often raised studies. >> to figure out if these tools are working. i think that is another aspect of helping people make these

choices. the transparency is one thing. if it is too confusing to people, it is hard for them to make the right choices. given the right tools when they engage. so we happily endorse this to get to the bottom of this. >> thank you. thank you mr. chairman. >> senator warren? >> thank you, mr. chairman. you were talking about the cost of the government. i want to talk about out-of-pocket cost to the individual consumer. back on this question about eating people to take their prescriptions, if they don't have their prescriptions filled in a timely manner. i understand that there is a study out now that shows for

every 10-dollar increase in the co-pay on a prescription, that the compliance rates on taking the medications dropped by about 5%. of course, in my view this is one of the best parts of the affordable care act. it has more people owning their prescriptions. his is going to increase to our compliance, people taking prescriptions by about 5% and that is what it is about $35 billion. these are very important about how we lower-cost, someone to go back to the question about how we lower out-of-pocket costs for consumers. how people can get those costs down. so sir, go back and what should

we be doing? >> we will have a significant impact. we were closing that passivity on generics for biological reasons. he is looking at team approaches. the coordination of care it is

not just about what government spends. it is to the extent that it causes people not to have their prescriptions filled. ..

make the copay is not medicines are about 10% of medicare spending. brand medicine, if you look at all federal medicare and medicaid spending. brand med sidz are about 8 percent of all of that spending. i don't think that it's the kinds of proposals that have

been suggested are what is really going on to help improve adherence. i think it's some creativity. looking how we time medication therapy management to utilization, looking for opportunities to take advantage of the cost savings that medicines can bring. surely you're not pushing back on the point. they rein creased in -- . >> no. >> i want to make sure you're not saying nap. >> right. i may have misunderstand. >> so long as we are clear on that. >> did you want to add anything on that? >>. >> yeah. i think you raise an important point. we have done our own research project and published a project on questioner generic copay how it can increase utilization and some of the flexibility that has been tried and private plans with value--based insurance the

problem with doing that in medicare is twofold. one is the basic design of part d includes arch cost sharing. they want to lower the copay they have to do it as an enhanced plan with higher premium. or there's got to be some change in the legislation in term of the overall average cost sharing program and bringing it down lower than 25%. there are implications for doing that. even within that perhaps some greater flexibility that to look at in term of letting plans experiment with lower copay or certain classes of drugs that are much more important clinically is something to think about. but also certainly trying to push plans and encourage plans, to look at lower copay for questioner generic. more bang for the buck. one of the things that complicates the story if the part d. program is that in the world of stand alone drug plans

if we increase adherence. we're increasing the amount of spend that the plans are on the hook for. so we built in kind of a perverse incent toif say they're going to do better when less spending occurs on the drugs. where as we may want more spending on drugs to get the payoff in part a. and b. and figuring out a way to change and rethink about how we build the stand alone drug plans to get away from the perverse incentive is worth something trying to think about. >> it's a good point. >> did you want to add anything to this? >> i'm over time. i'll ask you to be -- [inaudible] >> i believe that by simplifying a process of choosing a plan it would help individuals find plans in which their costs would be lower and that's a minor

thing, but it's something that could be done. >> i don't see it as minor. >> i it to be a good point. i understand if we're trying to reduce costs overall, copay costs for the individual must come down. and we're caught in the wrong cycle right now with high copay. and we've got change that. if we're going have better outcome and lower costs. good. thank you all. thank you, mr. chairman. thank you very much for doing this. >> going to the broader issue from drug plans to to the medicare advantage plans there's a star rating system. the idea is that you let the competitive market forces work. they see that the insurance medicare plan is rated higher on quality than they would vote

with the feet. and they would got higher rated one. now it's just been inexistence for just beginning. you all have any comment on star right system. >> the star rating system has been around, i mean, the new and financial incentive attached to it are the newest part of that. we had star ratings since the beginning of part d. what we don't understand very well is the degree to which consumers are using those ratings to make choices of drug plans. the information is throughout. it's on the website. it's essential. we think we have cone it in a comprehensive way. we haven't seen at love research to know how much people are using that. when we look at the aggravate how many people are in plans with different kinds of star ratings. we don't see a particularly higher enrollment in the five

star or four-star rated plan over the three-star rated plans. i think more transparency and publicity to the ratings and more research what is it that people take in to account and is simp flying the program. people aren't shopping. they're not shopping based on stars. if they say it's too complicated. i'm going to stick with the plan i'm in even though it has a two and a half star rating and gotten more expensive. that's where the problem lies. and so finding ways to encourage people make it easy to shop and take in to account some of the ratings as well as the direct cost factor is something we need to do better at. >> senator tbb, if i might. one of the important aspect of the star ratings system is in fact adherence to medicine. it gets a pretty good waiting in the star system. i think that's important. it's a good incentive. and let me just add to the

comments. i think we have to recognize some is going to be a work in progress. and there was discussion about the important of beneficiary shopping among plans. i think that's absolutely right. beneficiaryies when they switch plans save money on the out of pocket cost. one of the things that med pack found that in the early years of the program we only had about 6% of beneficiaries who are switching plan of open enrollment. it was 13% and among some of the youngers coming in to the program it's higher. it's about 16%. so i think there is opportunities. we want to encourage people to shop. we want to give them the tools. that can help. he can help on the out of pocket plus side. they are saving money.

>> how much in your opinion is the lowered cost that we're seeing -- due to the utilization of generic? >> a very large factor in what is driven in the study i did publish last year and really look at the gear in rick use as being one of the very important factors the lower cost. we had such a swing in a period of time since 2006 when the first enrollment in part d. occurred to more gear in rick use. i think the number between 2006 and 2010 were something like sixty some percent gear in rick use up to 80% gear in rick use. it's higher since 2010 which are the most outrecent data i've seen. it's a big part of the story. it can be even more. >> if i might. i'm going agree that use of gear

in rick is a sizable part of the savings. but two points about that i touched on in my testimony, one is the gear in rick originated with -- they wouldn't have been there if were innovator medicines to copy if it was developed. and the second is it's our marketplace that drives a very high use of gear in rick and maximize the savings out of them. mark when was cms administrator in the early days of the program emphasized that part d. in the competitive forces is actually driving up gear in rick use. >> you're happy with the health care bill that gave twelve years exclusivity for the by logic. >> you know, we fully agree with the determination made in congress. absolutely. you brought out here in the hearing that the low-income subsidize assistance is not being utilized like it should. what can we do?

i think it's a hard thing to address. i think some is the, again, complexity. so there's an asset test attached to the low-income subsidize eligible unless people come in through the medicaid program in some states. and so there is some thought that the fact that you have to not only meet an income task. you also have got attest to the assets, something that some people don't want to go through. they don't want to do that additional paperwork. it makes the forms longer and more complicated. and so we don't understand this question very well. and this is one of the dilemma. i think it's probably one of the sources. the fact you have to go through an application process. you have to submit an application either to the state medicaid agency or the social security administration, you know, fill out an application. wait and get it approved. it's certainly a factor.

then i think some is knowledge. i think the doctor talked about people who weren't aware there were these subsidizes available. and we need to do a better job of building awareness about the existence of the subsidies so people know they have options available. >> i'll wrap up, if it's okay with you all. you mentioned, senator warren, the burdensome cost to seniors, and i had mentioned the excess cost to the u.s. government in trying to afford the prescription drug benefit. the inspector general has come out with a study that says that medicaid as compared to medicare

with regard to drugs that medicaid collected two-thirds as much in rebates as medicare part d. despite having only one quarter of the expenditures that medicare has in their drugs, and the most shocking part about this finding is that the ig did this study with data before the accountable chair organization -- act mandated the medicaid rebate percentage increase taking effect. so this is before occurred. it's a huge disparity. it's a disparity, for example, we'll have copy of the chart if you need it that shows on heart

e burn and acid reflux medicaid paid 65% less than what medicare paid. with to scare lowering cholesterol. that medicaid paid 42% less than medicare. that's in an ig study done back then. so i'm going to call for the ig to have another study to get the latest information on these numbers. then we can discuss that in a future hearing. any further comments? >> okay. thank you all. you have been an excellent panel. the meeting is adjourned. [inaudible conversations]

[inaudible conversations] [inaudible conversations] tomorrow on "washington journal," cindy with the american real petroleum institute talk about the keystone x l pipeline. they look at the proposed shield law for protecting journalists when they refuse to name considerable sources. later a discussion on the impact of budget cuts on america's national parks with emily. washington journal live 7 a.m. eastern on c-span. this memorial day weekend our guest on news makers is senate veterans affair committee

bernie sanders. the 90,000 claim bag log at the veteran's affairs administration. news maker on sunday here on c-span. two candidates have been disqualified ahead of next month's presidential elections in iran. former state department official john and a former tehran-based "new york times" reporter talk about development in the country. he was among the captive in the iranian hostage crisis. this is an hour. >> i'm going give a -- by necessity. but the first premise i have in this town it may be hard to accept, i mean, with our obsession with iran. you can go, thank you for coming

out on a friday before a long weekend. but i have often noted you can spend your life in this town going to iran events here at brookings and aei and at the wilson center. it's not about us. if we attempt to make it about us, once again, as we did in the '80s, we're going mislead ourselves. and tire ourselves in to knots of bad assumptions and misguided decisions. what would be my advice to my good friends and colleagues in the government about the election.

first don't let the islammic republic make the election about us. it isn't about us. second, shut up about it. don't say anything. if you must say something, say as little as possible. now i don't have to say the obvious, but i will. and that is that the election has one major beneficial effect for in this town. for the u.s. government. and that is simply that he will no longer be president of iran. and as long as he was, i don't say it's not a personal -- this is not a personal attack or insult, but the reality was, and

i saw it from my inside and my brief and somewhat unsuccessful tenure in the department of state dealing with iranian affairs as long as he was his statements on the haul cost, -- holocaust, the statement about homosexual and other mare matters made him toxic and too toxic for any american official to deal with. his love of the outrageous and the devicive made him a liability, i mean, even for his countrymen who attacked him. who attacked him. whatever came from him, and or anyone connected to him this this town was highly suspicious and dangerous. and was just considered unacceptable by nature.

so what, if anything should we do? well, first of all, if the iranian election is good enough -- and what do i mean by good enough? by criteria should be about -- if it's about as good as the 2000 american presidential election, that would be about my standard of acceptability. if it's about -- if it's good enough, then our president should send a note of congratulation to the winner. and, of course, in that note he has to choose his platitude carefully. he should avoid, for example, phrases like odious regime. or change your behavior. or we look forward to your ending support for terrorism. probably not helpful.

platitudes are definitely the order of the day here. now i've always been optimistic that the united states and iran will someday break its ease changement. estrangement that ghost gone on for 3 years about hasn't done anyone any good, in my view. but this break is unlikely to happen as the result of this for any other iranian presidential election. there was no break even after the surprising and overwhelming victory in 1997. even though the two sides did start to change the way they spoken to each other and began to talk about dialogue and began to talk about road maps and these kinds of things. but in the end, then the

estrangement really unique in our diplomatic history continued. so what would break in this? what would make a difference? i would say it will come with the weakening or maybe disappearance of the senior clerical elite that held monopoly power in iran since 1979. a group of originally about 25 senior clericals. now, age has taken -- time has taken a toll on the group. my good friend who was here at carnegie says that this group's arch age now is deceased. [laughter] but some are still here. and still important. many have departed, but and one

has taken on the unlikely role of outsider. but the few that remain. and the names are familiar and the famous -- [inaudible] they continue to wield considerable power and so far have shown very little inclination to change either the foreign or domestic policy that have kept them in their palaces for 34 years. real change and change that matters to us will come not when one figure head replaces another

figure head. it will come when the old men's club that has dominated power -- offer -- officers for 4 years finally loses its grip and allows a creative dynamic, well-educate population finally to express itself. thank you. thank you to all of you. before i open up the floor to questions from the audience. i would like to follow up a couple of questions myself. to begin with, there was a couple mentions of the outgoing president ahmadinejad. and i would be interested in hearing thoughts, you know, there have been a lot of, you know, ambassador, you just mentioned you thought you have seen done inside iran. there's been a lot of discussion sort of riffs between the

supreme leader and the clearic. i just in hearing any thoughts on whether he's likely to try to play any role in the next three weeks. if he's likely to make public statements that may influence the course of the election as it's coming. i would also be interested in hearing thoughts on the impact of developments elsewhere in the region primarily in the arab world on what is happening now in iran. you know, since iran's last presidential election in 2009, as i mentioned outset we have seen the uprisings that had, you know, intense consequences as cross the arab world. i would be interested in hearing thoughts on the impact of the change in the arab world, on both the perception of the iranian people of their own government regime and at the

time of the election as well as kind of the government regime's thinks about the election. so i -- maybe can we start with you, ambassador. and hear thoughts from the three of you on those points? >> i would be very brief. i will will be interested in hearing from our colleague -- from my colleagues. but in the case of president ahmadinejad -- it's hard see what he can do because his favored -- his favored candidate isn't running so far. he backs in. and a lot of his appeal was based on some personal items that effect him. i mean, his flamboyant. his pop populism.

his incorrectble which is a big issue in iranian politics. it has been for a very long time. and the fact he's not a clearic. ic he pretty effectively tapped in to the anticlerical strain. anticlerical strain in the iran yab political culture. very effectively. if you have seen most of the candidates coming out are not close. i think he's the only one. on the impact of developments elsewhere, obviously they do, and everyone knows it and attempts to pretended otherwise our seen through immediately. very transparent. i would -- in interest of brevity i would cite only a logan which i'm told was very permanent in tehran after the

failure of the green movement uprisings in 2009, and the success of the arab spring particularly tunisia, i believe the slogan, if i'm right is -- [inaudible] it means tunisia could, iran could not. and the lessons that, you know, the lessons are there. whatever the outcome the quality of the outcome and the arab spring. the fact of the matter is that some at least some of the arab countries have done -- have overthrown entrench unelected, corporate systems that the iranians have so far not been able to do. >> all right. >> it's true. it's true. that the iranian people particularly in 2009 who are

unsuccessful in ousting their oppressor and transitioning to democracy. it's also true that there were four million people on the street of tehran and no other arab city even came close to that including cairo. the different political systems, the iranian regime is far more sophisticated and -- government in the middle east. and the fact that these other regimes in the arab world, egypt, tunisia, particularly egypt and tunisia were aligned with the united states certainly helped very much in term of the people power ability to rise up against them. they were just far weaker regime. as far as people -- very close it iranian civil society, you know, mubarak reaction to what was happening on the streets,

like, you know, compared to what they managed to do. the repression is far more sophisticated in that he watched what they did. ..

>> just because someone wears the same shirt everyday doesn't mean he is incorruptible. we have the people time and time again that look like they are at the down-to-earth, salt of the earth people. but during this time, the primary constituency has accumulated enormous wealth one dynamic to keep in mind that might be a proper democratic change is the price was $15 a gallon for oil. keeping people from this to be set-aside home.

we probably can't afford to do that anymore. but also it helps a lot that the price of oil is much higher. and the corruption has exceeded anybody's expectations, primarily because of this. >> i'm going to start with this factor. he has said that he is not going to give up. he has less than that. he has access to a lot of state files. i highly doubt that he can do much.

and whenever he wants to get rid of them, he can easily get rid of them. this includes guards who have benefited from the decisions and he has empowered them, practically. but if he decides to mobilize behind street, i highly think that he can have like 7000 people who would demonstrate in his favor. this includes government figures and these people have moved up this situation has improved mostly because of the oil market.

going back to the question and the revolutions in egypt and tunisia, i was very surprised that immediately after that, the iranians started comparing the revolution in egypt with the 1970s revolution. at first i thought they were being jealous and envious. after all, the iranians can do, what they can do after six months, and the number of iranians tools that will work with this. but the vast discourse continues.

the situation is so different. it should speak to a zone in iraq. and in regards to hosni mubarak, there are many major differences. iran has the oil money, the islamic republic is not alone with this in the united states. this is benefiting us. they don't have to see any change. they will go out of their way

and in addition to that, there are no benefits to the islamic republic. we remember what happened in 1917. they remember the war and it is not that they like this, but they are very much afraid of any institutional breakdown. especially if they don't see another alternative. and they are happy to see some change. rather than a big institutional change, probably instability or violence and then going to what they did 35 years ago. >> i thank you very much. i would like to open up the questions from the audience. we have a microphone that will come around and if you could please briefly say your name

before the question. we will start right here in the front. >> okay. my question is what is the significance of the election and the negotiations. particularly into non-a lot. especially in regards to what you suggested that i show a round of hands, so i will take a few questions and then we will take questions as well. >> thank you so much for having such a political system. in regards to the rejection by the vatican will, you are reading this and the group's power. one reading would be that they were so frightened by his group, and they are weaker, and they

have the other reading with the supreme leader and revolution guards that feel so strongly. that they just don't really care anymore about legitimacy for keeping others within the fold. thank you. >> i would like to ask what you think the iranian government's perception is. we will take more questions. and i would like to start off with an adjustment.

>> i think the leader has learned his lesson he allowed the elections to let it go he was definitely going to be in control and pose a serious threat. he would've challenged at. and when you think about it, they do not fit for any popular elections in the past 35 years

area the council that is rejecting the candidates is appointed by him and none of them have any elections. and that has stood for several elections and he has been elected as president. and he was the top go-getter for the council of experts including he is not going to compromise. he's not in a position to start compromising with the iran thoughts.

including the leader who brought the country that includes everything about him. this includes things that started a few months ago. they have to be offered a good proposal. so that they would be able to come out. to see that okay, we have lost. we had things to offer an society says, this is what we have, this is how much uranium we have. so we have this much stockpile.

now we have defeated the enemy. we have other hard-liners that do not have any islamic republic pressure. that is where the american international community has more pressure and the way the eu have this election come in the way that is coming out. it is very alarming this

includes our foreign media speakers. this has been one of the dignitaries from 1997. i'm sorry, in 1999 they didn't mention it that way, but now he's coming down 1999, 2003, and he gave the order to open fire on demonstrators you know, it was very clear that these intended audiences are related to voters.

it includes those that you're going to be there for and he said that i'm going to stand up for your rules. >> madam, if you can continue with your comments on the question in the perception of the united states and the impact of this on the human rights commission. >> i could not agree more with you about how it is highly effective and important morally and strategically for the united states to put the pressure on the iranian regime as far as human rights bill. it has always been effective. the regime has always backed down on political prisoners or freedoms once they see the outside pressure. the idea that there is a bogeyman, and american bogeyman behind aspirations for democracy is actually something that the regime has used time and again against the people. whether or not there is any

american backing for the aspirations of the american people for democracy, the iranian regime has constantly accuse human rights activists and defenders and journalists and intellectuals and artists and musicians, ordinary people of being american spies. you are gone if you do, darned if you don't, so you better do it. you better do it. do the right thing, see say the right thing, be strategic about your comments. in talking about the white house, talking about the state department and rights, they talk about the bush administration how people are working right now in state department and they're talking about it is the white house was making those statements. including how the individual was released due to the pressure. now we have this backing off if

we stay silent. if we stay silent, somehow things will be going the right way. time and again we have seen this with the other countries. the same thing. dictators don't like them when they are called upon what they are doing. what is more, the people from inside are saying it. their primary slogan was you are either with them or with us. we have it on our website. about how we are saying the same thing, calling on leaders from the free world to express their solidarity with the human rights defenders and the activists. with the artists and musicians. it is not like there is one or two people in prison. if you are a filmmaker coming out of prison. if you are an artist, you go to

prison, if you are a university professor, go to prison. these people are going to prison. if the united states doesn't speak out for them, where are we going to speak out and how we display our values? >> if you could begin with the question on the impact on the outcome here -- okay. first of all, i was noticing how one thing here, it says in the handouts that 7456 lawyers -- iranian lawyers sent a letter calling for disqualification of the president. anyone who is opposed by that many lawyers cannot be all bad, i suppose. okay. the nuclear issue. i have a somewhat different position. i certainly agree that this election is not going to change

the position. nor will it create an opening. my own view, which was not widely accepted within the administration, when i was there, this particular issue for all kinds of reasons, but it has become for both sides to ladin, perhaps too laden with testosterone. both sides have a painted themselves with concessions that we want the iranians and the iranians, with what they want, we cannot give. maybe it is time to perhaps put the issue aside and not to forget about it.

not that it's important, but look for other areas where the sides can discover that it is possible to say yes and the sky will not fall. and then if we can find other areas such as afghanistan, and narcotics and the persian gulf and whatever else it is, then perhaps you can come back to the innovations. if we don't see this election during that time, on the human rights issue, i couldn't agree more that you don't have silence that is not the way to go. like everything else, you are smart about what you say. you have to be careful about what you say. you can feed the propaganda machine which says that the

human rights campaign is nothing more than what they call a soft overthrow campaign and i would point as an example to the outrageous incident around town, most of you are familiar with it of this. and how these very strange organizations have drawn support from including former american officials who have addressed the madam president and these people so that they were some kind of democratic group. i think most people in this room know who they are. if you like jonestown, they just -- it is just your cup of tea.

people who think that they are supporting human rights and think that they are reporting a besieged intelligence, it is urgent to statements do not help. and supporting a group like that, frankly, it is not helpful. >> it seems like the propaganda mission does not need any seating. whatever the united states government does, they're going to continue with their propaganda machine.

it is not as though staying silent will help them to not have trials that are shams or not rape people in prison or let women dress the way they want and not the entire leadership or executing homosexuals. really it is the entire iranian nation. you can't even call of issue-based. the united states by not speaking out, we are taking specific things, it scares the administration from doing the right thing. because of these kinds of arguments that the obama administration has stayed away from doing the right thing. i just want to say again, more to say before, the people are calling for this.

anyone i can think of who whose prominent and willing to be decorators, it is calling upon us to say that it is us that should matter. and you have abandoned us. >> we are in violent agreement over this. [laughter] >> we are. coming back to the audience here in the back. >> okay thank you all very much for your presentations and viewpoints. john kerry said this morning that the guardian council has stepped in the way of the path of democracy and iran. this includes the human rights defenders and activists. they're the ones that actually

want the international community to do more in the u.s. to do more. the problem is that they are not into this issue power or in a position of power. anyone who could play that role, they are not falling into this to do anything. so i'm wondering whether the reform is an establishment. if they would be more willing to speak to the national communities. those who say that the u.s. should be doing more. >> i know that we have touched upon us briefly. outside of the dynamic, this very department, the fact that, i think perhaps supreme leader

is to hold onto them and their power. it is a completely different image and i just want to hear your thoughts about the impact that we should have on this election and how the candidates are trying to appeal to this i thank you. >> hello, i am part of the search for common ground. you mentioned that this will be very good news. and i was wondering what your thoughts are [inaudible] i know that he has not generally been a great negotiator with the

u.s. >> one more question from the front. >> thank you. i teach at the university. coming back to the question that has been raised, anything should be viewed in this way. my parents they don't do anything like 1953. because government empowers people. it is the result of 1953. and the cia coup in iran. it is an intrinsic view, many famous american authors that track the iranians progress.

madam, according to your statement, but you are talking to the leader of the free world, having genuine democracy in iran, looking at the middle east, who are those friends? these are the friends and leaders of the free world by supporting and continuing to support this movement. i question is what genuine opposition should be dependent with the united states the money from the cia. you know, real organizations and things like that. or should it be on our own feet?

you had mentioned twice in her speech about the democratic election in iran. in the first scenario, if someone comes and says, okay, we are okay with it, this has become a democratic election board the election was a democratic election, because they said that first of all, the candidates first of all should be men. right? at least 50% of the people are women and they don't have rights because of this. secondly, it should be shia law. fourth, it should be our sharia. fourth, it should be supported by the guardian and the democratic movement that you're calling in this election, it is completely shams. >> thank you. we will take brief responses

from the panelists. >> i would like to begin with that answer. >> a couple of things. i have not seen this as of yet. >> i have not seen it yet. and i am going to do -- i didn't write it. i plead not guilty of that. but i am going to do the cop out and say that i cannot comment on something that i didn't need. the kind of temptation to sort of get into the details of other countries electoral processes is one that i think we should resist. we turned a turn to general principles, which is supporting democracy, supporting the right of iranians, like everyone else to be treated differently by their government.

and recently a senior government official referred to this regime as odious. whatever we think, you know, maybe she is speaking for what many of us think. we need to choose our words carefully. the difference is would he be any different with negotiations and would they be better and i'm not talking issues of substance. is that people could not

consider anything coming from him personally or any part, anyone or others connected with him. he was considered too toxic and difficult and no political could deal with this since 2009 and the meeting that he had with then undersecretary bill burns in geneva, he had recently refused to meet one-on-one with the delegation. my view is that that is a mistake. it is shortsighted on their

part. at the last i heard was the islamic republic was not seeking my advice. especially on a particular question. >> and suggest that question resolution for you? >> yes. when we stay on principle. it is time to talk when the country has an election. you can't say this is the democracy that we can talk about free and fair elections. how else are we going to talk about democracy? least when they are having elections, when you talk about how absolutely corrupt they are. to news ago we were in tonto for a conference that was put together for the monk school of the university of toronto. the canadian defense gave

rousing speeches to a group of iranian dissidents. the entire time, all i can take was that this was absolutely wonderful. this is so incredibly powerful and useful and effective. primarily the united states, if only they could join, it would make all the difference. >> the canadian government should not be the head of the united states government on these matters. the french government should not be ahead of us on what to do about what to do regarding libya. this is the united states of america and we are supposed to we the world when it comes to freedom and democracy. >> i would like to ask last question. about everything. our terms are relative. i think that democratic elections in 1997, at least people's votes were counted. after that come the votes -- the

ballots were different. again, regarding intervention, before this coming election, including democratic elections and how they were had. i want to go back to the question about the revolutionary guard and i think that that is where i disagree with the ambassador. i think the revolutionary guard has taken place of the founding fathers of the revolution. he was a midranking junior cleric and he was reluctant to work as a senior cleric who started vanishing and sidelining them. and that is when he got rid of the judiciary and brought in the midranking cleric. since then, we have seen that we have gradually pushed the cleric

aside. we have more and more revolutionary guards, such as those who are becoming a more powerful people. and i think that that is how he is calculating and he can easily remove them without being challenged by a big support group. >> thank you. there a few more questions we can answer in front here. >> collin winston. my question is for the woman in the front. you have talked about human rights in iran. is there anything the u.s. can do other than talk. is there anything we can actually do as a legislative agenda beyond just condemning the problems?

>> taking another question or two, right behind you there, please. >> i have another comment. >> your comments, please. >> this asset has to do with the revolutionary guard. including all of this that is managed. [inaudible] including part of this and he won't someone who is part of the community and part of this situation in america.

meaning that it is the kind of thing that we need to operate. the only person who talked about this is the relation between israel and and islam. it is disconcerting. and i think it is not just that the u.s. does something to iran. it is getting from this regime and the future interests. we have this that is managed and this is established middleground. it is the ability to put our

power together that is organized and international based on sanctions and put iranian government to be extremely pressured and not be silent. and this includes specific candidates. you know, we do not want to talk about the election. if you do not want to put the footprint on these issues, if you want to kill people, it's like, that's fine. there are those that are part of the regime in europe. same regime and same idea.

republicans saying that we need to moderate this. and we do not know what is going to happen. >> thank you. one last question here. >> hello, i am part of the international program. you think that you would provide direct support and provide the restriction and we have about 2400 people with that. there a lot of restrictions and added pressure. my second question is don't you think that the direct support is part of these nuclear negotiations and it's interesting that there could be an opportunity to talk about this.

>> any final comments that you have these questions are related in that the first question here within the united states government is more specifically beyond talk. the flipside of it is that it's better not to do much that is exactly the line of thought regime wants people to think then you will not get anything on the nuclear front is a cat and mouse game. they have not completed on anything.

if you push on human rights, you come you are not going to get to the security issues or whatever trade. i think while he was in prison, and essay was written by him about our biggest strategic enemies, intellectually, are the people who live in the west and try to convince their government time and again somehow

magically, they believe that if they don't put government pressure on things, things will improve. what can the united states do more specifically in terms of legislation? individuals that we know are responsible for torture and assassination holding people responsible who are filtering the internet. those that are in charge of the prisons. get down to the prison level. get down to the interrogator level. names and names as much as possible. there is only three years left. but congress can, with parliaments of other free

countries, we can convene assemblies of free nations. parliament of free nations support a democratic iran. the canadians, canadian parliament, the canadian prime minister is ready and willing to do such a thing. we need an assembly of free nations to support a free iran. i could say more, but includes a wonderful saying. saying there's no color beyond black. the color for same.

the human rights issue as one that we all are obliged to. i don't have a good answer. i would do it in a smart way. we do it in a careful way. >> i just want to agree about the situation. i am half canadian. i have been having such an example of that. we have issues and there are a

lot of lawyers that have said that there are not that many judges and the iranian tradition who are willing to hand on jail times or even harsh sentences for activists. there are only five or six of them who are in my situation of handing down those kinds of sentences this would be the perfect one, not. >> thank you very much. we would like to continue the discussion please join me in thanking our panelists. >> thank you. [applause] [applause] [inaudible conversations] >> mount "washington journal",

the american petroleum institute talks about the keystone xl pipeline. and the council for the newspaper association of america looks at a proposed law for protecting journalists when they refuse to name confidential sources. then a discussion on the impact of budget cuts on america's national parks. "washington journal" is live at 7:00 a.m. eastern on c-span2. >> the white house has announced that president obama will be in oklahoma on sunday. to look at the damage in oklahoma in the city of moore. and the memory morrill of the seven children who were killed in moore on monday.

[inaudible conversations] [inaudible conversations] [inaudible conversations]

[inaudible conversations] [inaudible conversations] >> saturday on c-span, commencem members of congress and we will start with al franken at the university of minnesota. then ted cruz at the university of michigan and south carolina congressman gibbs eight commencement speech at the university of georgia. wrapping up wet the wisconsin senator tammy baldwin at beloit

college. messman addresses glendinning at 11:45 a.m. eastern on c-span2. >> the state of the air force is discussed along with automatic spending cuts. the strike fighter program and operations to meet the asia pacific region needs. this briefing is one hour. >> good morning. [inaudible conversations] >> good morning, everyone. we have the air force chief of staff here. we would like to update you on the state of the air force. i would be remiss if i didn't

mention the preparations we are preparing for january 21. this includes the secretary remarking on how it is a difficult time and he has worked tirelessly to make sure that we address the challenges. he has been at the home leading the world's greatest air force in countless military operations. we are delighted to be a part of the nuclear pentagon and he has established a strike team without assistance. he has been a champion and we are proud of him for engaging in these support groups. he's eddie and public humble servant. he is strong and ready and capable wherever and whenever. we would like to publicly thank you for your service. folks, i would like to let you know really quickly that you

should identify your name and affiliation before you ask a question. we would appreciate you to hold your applause to the end. >> good morning, thank you for being here. first, i would like to say a few words about the situation just to convey that our thoughts and prayers are with the people of more oklahoma and that is quite near the air force base. as we cope with the aftermath of monday's devastating tornado. in the wake of this tragedy, we are also very proud of those who have come to the aid of their neighbors. members of the oklahoma army and

many others. we thank them for their selfless service and continuing service in this time of need. including in that community. the general and i have testified before congress on the air force budget proposal is certainly a dynamic environment. it includes the modernization of our air force. this includes the effect of sequestration. and i hope that you understand that important training has been canceled. the impact we have been

consuming this for several years and we will continue to focus our resources that we do have available to meet combatant commander ironman. with a steep antley budget reduction that is brought on by sequestration. we have been trying to dig out of this, and it is a whole that we are trying to dig deeper. we have a recovery time. the challenge facing the air force is pervasive. if unaddressed, it will seriously undermine our ability to accomplish what we need to undertake. lester we had the first $487 billion million dollars in the budget control act. it became elation or delay of modernization programs accounted for 65% of total air force reduction. this year, each program was reduced by more than 30% in the

recent sequestration. looking ahead, there continues to be resistant to full structure changes, closures, including compensation and given our current focus on improving readiness, it is likely that the reductions in the control act will wire further disproportionate cuts or modification program. with advanced technologies that proliferate this risk, it puts at risk the air force capabilities in the decades ahead. despite our near term, we are working to ensure the most significant air force priorities remain on track. including the fifth-generation of strike fighters and tankers in the long-range strike. particularly highlighting an

important aspect of the program. on wednesday we announced the alternatives for the summer training unit this includes are three good candidates and as weapons we have made for initial basis. they are the living engines of the air force.

this includes our nation asking even more. the draconian budget choices face extraordinary challenges with our decisions. especially as we remain the world's best air force with whatever resources are provided. >> thank you. thank you for being here today.

two of our members were lost and there are no words that can raise suffering for the loss. we are very sorry for their loss. as usual, people have come together and shown a commitment to serve their fellow people. this includes providing recovery efforts.

we just want to get to the bottom line. we want to get to the new topline. the budget and the willingness to prepare this in the air force. this has been aided steady decline. we hope to put the spectrum training on the back burner. the budget control act explains the management risk that we have been expecting to deal with. and that sequestration has driven us over. that is when we understand it

today. it's always a bad idea to control this and we have entered into a time where we must recover. this includes the bomber squad and we already have aircraft and engine and we have deferred over 50 facilities across 24 states in three different countries. sadly, we have reached a critical part of our air force family who have to take a 24% pay cut. the readiness continues even while calls were no flight zones in response to syrian violence continue. we are still the best air force in the world. who are the great airman has dedication that is unmatched.

that is what we are hoping for. while we do all we can to minimize the timeline, we understand that we have to be a viable air force in the future. we have to figure out how to make that happen while maintaining an air force that is ready along the way. that makes it an initiative all the more important to us. this is something that air force desperately needs. ..

>> current a 22 f-35 are flying with the backbone of the tranthree and have flown over 1200 so far and also delivered to another air force base to begin operations testing. we're excited this program is on the road to success and your great for our international partners remain as committed as we are. the future of the united states of america is the aerospace and cyberspace

future. that is my opinion and will be the most contested and congested and defended with a military that is also with the united states air force does our job. secretary -- secretary donley is to make sure that with the security objective is met in real work hard to ensure whatever resources their force receives will be used responsibility -- responsibility for modernization and readiness carnation demands precise delivery with the roles greatest air power. thankfully we are blessed with 690,000 men and women who will provide just that. they amazes' every day and it is an honor to stand beside them. on their behalf behalf, mr. secretary as you into your final month i'd like to publicly say thank-you to you for your steadfast guidance for five years, rock-solid leadership

and your patience and personal mentor should i have learned more than i can begin to express over the last five months also like to thank you for bringing your wonderful wife gail as she has been a joy to work with and has been taking care of the family she rocks and we will miss her to do. you're a great darman. ladies and gentlemen, can we answer any questions? >> my question is first of all, with india and the u.s. with the air force is concerned any comments on the recent chinese missile

is most of the country's it depends of u.s. airpower. what do you think of the future? >> i will start with the chinese military with air and space developments very carefully as well as other activities we discussed in the cyber arena. no specific comments that we do trackless on a regular basis. maybe ask the chief to talks about the relationship with india which is very important to. >> it is the focal point* for the pacific airforce commander of that he and members in brown has become very close the attached and i hope to meet the indian air chief as he travels to the states and i think that

meeting has been arranged. recent navy had to lew can silva red flag exercise in the year very sorry we did have the resources. we will try to get india back as soon as we can because it will be viable much just them but for us. >> there was a deal between u.s. and india with the f-35. is that still on or what is the future of the modernization of the forces? also the list to buy. >> i believe india has made different choices but i will see if we can get you an answer for the record. >> has interests with the

f-35? select i will give you an answer for the record. >> general welsh you say sequestration has given the force over the cliff is it your understanding the members of congress understand the gravity of that because so far there hasn't been much of a reaction to the standing dan of the 17 squadrons. >> i think they're star people and it -- where people in understand the complex it is a difficult problem and everybody is looking for a solution amir doing the best we can with the resource reese have been given to members of congress are looking for a solution and they will come up with something. >> using the air force cannot execute all the missions the nation expects of its right now? >> no what we're focusing on are the missions that we

know about and are committed to and we have exceeded all of those. my concern is the unknown. because we are funding the unknown and taking a risk with the unknown. contingencies are a problem the longer this goes and the less training our people would have that we would normally require. >> congress doesn't seem to be in a hurry and sequestration continues with the knicks steps for structure reductions? >> i'm sure the secretary has a comment that we look at every modernization program whether a new buyer or degrade to the old system to determine which ones can

we continue what are the first to go up? we are looking at the reality of next year's expectations most of the major concern. >> the department is involved in strategic traces of the instrument review to set the potential impact of budget reductions at various levels including sequestration which would include sequestration 13 in

admiral papp. that is the ongoing discussion not just 14 but over the 13 through 23 period and i will offer the impacts are significant and negative with every aspect of the military capability. modernization, readiness and across the military including the united states so we are working through what that was looks thorough bond negative like and specifically the deputy secretary has us focused on what we call the financial plans, the ex-con -- execution plans at levels below the president's budget to reflect the sequestration

continuing from 13 into 14. >> to give us some idea what the danger is, what do you think would be most at risk? the modernization program that you could shield those so far or another situation perce? >> i think if it persists and we have to figure out some way for word to either start digging out for improvement or perhaps not at the beginning of 13 or 14 but the negative situation will continue. no question. we know that already but if that could be extended we

would like to figure out ways to mitigate that. also we would like to be making strategic decisions that informs how we approach resource planning over the next decade. except for the situation of the budget control act, we don't have the topline to work against. moving horse -- month to month and quarter to quarter is not the way we would like to operate. we need a sound topline.

>> of mr. secretary are the f-22 deployed to curry is still there or have they return to japan? if they are how long will they remain there? >> we will have to double check that. i believe they are back in japan. >> with everything on the table with the review the nuclear forces have been protected this fiscal year but by going forward do you have a plan be that you can dust off the shelves what

the icbm likes of the triad see you don't have to limit those or do modernization and? >> the short answer is the department in the nation's way for reduce depended on national level decisions that the president plans as diana stand to make, next year. we have conveyed the nuclear force issues will not be sorted through in terms of how to implement a new start agreement until probably somewhere in 14 i think was the guidance. i will check that day for you. but with respect to how its affects air force planning is a little more effect on the icbm side of the structure because of the bombers side we already know

we will hit with the long-range strike ballmer that we focus on conventional capabilities but also nuclear capable so we have a way for verge on the bomber side but it is independent in some respect from the nuclear decisions that are still pending. >> if asked to have ways in the budget program to do more cheaply? >> yes. there are ways to address different aspects ptah of the nuclear enterprise and we have lots of options and there are many programs but to offer the broader context , what the folks are focused on the size of the nuclear enterprise between

the sea bass and land-based forces call for they said of the triad need modernization of some fashion some there is the overhanging requirement to upgrade and modernize its command-and-control that goes with it. >> are either of you at the point* where you are growing concerned that a competitor may misjudge our ability to respond should we need to because of sequestration kets? >> a rougher it is very important as a challenging the fiscal issue concerning the nation and our military

that we continue to do is engage with allies and partners the rest of the world to collaborate on international security of various regions to continue to answer of effective partnerships with potential conflicts to get ahead of international security and to do that in a team based coalition approach. each of the military and political partners is in a different place with respect to the military to offer different capabilities, real estate, in a different place for modernization but we work with independent partner of a regional context to address the issues and i think we share a common goal to get ahead

of comedy tiering conflict and addressing the terrorist organization as the president outlined yesterday it is very important to us. >> would hope before somebody made that calculation they would think carefully of the risk associated with it. clearly the longer we go through this situation the greater the opportunity for someone to make that decision. >> with south korea it is to look to acquire the next generation of fighters and there is competition and with the f-15, and f-35 in europe.

but those of the next generation with the allied operations? >> user national decisions and we continue to support ourselves carry and allies in the election process providing the data they need to make their decisions and as you mentioned they have competing aircraft in the american platform and our job is to provide the information that they need to make their decisions. their strong partners and allies and i think would remain so in any situation going forward. >> of would like to get some more discussion we have to

start out now and have been told now for couple of years that this was something the department needed to get its arms around and they have looked at how they can contribute but it does not reflect that. it is the same cost of her flying hour with the normalization of the f-16. how do we take that? does the firm and have its hands around the problem? what is the of fixed and the cost of the ellen s. cost and also what about whether or not you will take the three software? >> just to start off i am sure the chief will have comments as well. on the last question we will

make the ioc notification to congress as well it has been coordinated between the air force and navy and marine corps so we work through that and the report will go to congress next week on time. the first question? it continues to be an issue in the department you see the numbers that came out but i will offer there is no final answer as we continue to work on the deficiencies in the program to discuss ways to share costs and mitigate cost to make smart choices between how we structure contracts and logistic support with the contractor support so there are lots of issues and opportunities to continue to

work the cost. it is an issue we look bad and it will look at to drive the costs down. >> the disconnect is we continue to be told this, not just the media international partners but the official documentation does not reflect any of that. what about this discussion? how is it not just rhetoric? >> the ongoing discussion inside the department and if we have better data it will be reflected going forward. is a matter of continuing discussion we always try to drive down the cost where we can and the result is questions internally how we do logistic support and the operation's cost so there is

no single member that locks in for the lifetime of the 30 year program so the numbers will suffice to adjust. >> general welsh can i get your input and your assessment of the f-16 cost over the 35? >> i think what has been going on for the last year is trying to come to any payment of the comparison of the two numbers. from lockheed martin program office and people involved in this suspicion i think we have normalized to a couple of members now about $25,000 per flying hour and 32 roughly for the f-35 that number may continue to adjust itself as we decide what factors are in or out

the pact gives us an idea. that number is a good thing. where also getting more practical data based and overtime that gives us a view of the long-term cost. we're not flying fully operational melodia but that data has to richard just like every program with the projected cost we don't really know until we support and sustain its. some of those still developed and once we get more fidelity we will have a much better feel for the cost. >> to deliver a report to congress to say what it is about the might understanding $287 million

but there was a deal offered for one-tenth of the cost is that something you are considering? >> we have seen it. i don't recall is what i was describing as a complete estimate and there were operational implications from their proposal of using sensors to bring down of those to put on the operational implications. i will offer this continues to get close attention and issue on the hill and they recognize that and continues to be debated within the department and be continue to try to get the best fidelity and understanding

of the comparisons. >> even before the current sequestration problems with the budget many people think of the study of the pit to asia this rhetoric without reality. given those pressures how will that affect your plans to rebalancing and within that with the area of denial across the nation of the persian gulf with the capabilities what is your assessment of the entire raid -- radiation missiles do need those technologies are tactics? >> with those tactical capabilities at this theater

level at the air force we are sustaining them for structured presence across asia pacific we have had for decades now. we will get the numbers to clarify but i will try to remember some of the top of my head for the pacific airforce between 43 or 46,000 and we will get you the numbers. but we continue to remain engaged in the asia-pacific region. if you look at the high value assets where it is deployed, a time in the theater is 60 percent of that capability in and around the pacific theater pohai.

we have done routine theater packages up and down the pacific to control the bombers out without region on a regular basis and this continues looking for the department has announced the first location overseas for the f-35 will be in an area of different responsibilities and we are focused on the potential challenges in a number of theaters and the capabilities we are developing for more contested environment around the world of the middle east and the gulf and in asia and other areas as well. we are developing a more effective capability that will also be used in the asia-pacific. >> all it means really is a

threat sensor's get longer ranges and we have to worry about that but this isn't the pacific only problem but what it does do is makes us look at it with range had to extend the range of sensors of weapon systems? had to become more interconnected to plug into a network or a system that is already in place and that is what the capabilities mean to us as the airforce. we also need to look at a speed and stealth and how they affect killed change to disrupt the pending there's or hours it makes it harder to execute. they are good things and it does not stand alone but we have to continue to look at

what they can do for us in the future as we modernize the big question is what will the stealth mean in 2014 had we have the capabilities of that regard? with their rebalance it points toward developing capabilities and operate in that environment and in the pacific to develop to stringing existing partnerships because there are new and emerging partners available and the capability is developing will help them develop or learn said training from the much broader contested environment can something we have to do to get back to full spectrum. >> with the afghanistan airforce, what kind of

presence of a planning to have? . .