>> that highly inaccurate and it's highly i think a little bit dismissive of our current immigration system. are usually with the h-1b process at all? right now if i came to the united states legally, not coming illegally, i came here legally as an h-1b you worker,

someone who works as a guest worker in the high-tech industry or requires a college degree and i had children in the united states, they would become citizens but i would not be, necessarily, i'm have a right to become a citizen of the united states. i could apply for citizenship but there's nothing that technically says i have to become a citizen. there's millions who come to the united states who have children and they still have to leave, even though they came here legally. are you aware that? >> i did not know that. >> so it wouldn't be treating your family any different than we treat the millions and millions of people who come legally to the united states and they don't have a right to stay in the united states. now, i want to find a way to make, to help the 11 million. i don't have a problem with that. but to come here to congress and say that we're putting her parents in the back of us when

we're treated -- we would treat them the same we would treat anybody else who came here legally who doesn't have a right to citizenship. i think you need to rethink your rhetoric because there's people that are here legally that don't become citizens of the united states, and their children and have the same values, the same belief, the same everything that you have that the law does not allow them to become citizens. yet they can actually stay in as guest workers in many, many industries. i want to find a solution for this problem. i want us to treat everybody fairly. so like i said in my opening statement, the most important things for me is the rule of law. making sure that we prevent having this problem again 10 years from now, 20 years from now. because, frankly, that's not fair to either one of you come if we continue to have these problems for the next little while then it will be another ms. rivera, another ms. velazquez coming to congress

and telling us about the compelling story about the families and how their families now need to have a new legal status. so i want to help you. i want to help your family, the most important want to make sure we fix the problem that we have to we don't have to have this conversation again. thank you very much for being here today. >> the chair when i recognize the gentleman from texas, ms. jackson lee. >> let me thank the chairman, and i join with the idea that whenever we make steps towards improving lives and we are really doing the right thing. because that is the challenge and the charge we been given in this congress, to come help and fix america's problems. i want to acknowledge my appreciation for all of the witnesses, but if you want to thank in particular ms. velazquez and ms. rivera,

because along with your knowledge that our personal stories that are being told. and ms. rivera, i can't thank you enough for discussing something so personal. and i think if we can all appreciate each of the humanity, that what we'r we are talking at is not the nuts and bolts of moving checkers on a checkerboard or chests on a chessboard. we're really talking about human lives. and i believe that we have held human lives in the balance too long. this has been going on too long. the key to this is not presupposing or predicting bill -- hill, disaster and devastation, but to look at this as a marker in terms of

attempting to frame doctor duke the release this i'm so that we don't have the idea of someone being able to say this will happen again. i am, dr. duke, i want to pose this question to you. we thank you for representing the southern baptist this morning. evangelicals who have made a commitment and have embraced i guess people from different faith and they believe it's time to move really on the human aspect. as you listen to ms. rivera, ms. velazquez, you know there's a comprehencomprehen sive pathway to citizenship. there is a crack in the armor when you suggest that you will take the children. i know that some years back ranking member and myself worked on in various worries and then together the idea what kind of facilities children are in the

young people are in under the age majority. previously in detention sent it wasn't a pretty scene. it wasn't a pretty scene we had to separate families. so the human question rose, the idea of human trafficking which are now the church has worked on is disastrously. i come from a city that has an enormous problem of trafficking. it's houston. so my question to you is, do you see the value in taking a comprehensive approach and regularizing family members, agricultural workers, tech workers, other skilled workers that really reins in what i think our friends have been speaking of through the searing? >> thank you for the question, congressman jackson lee. yes, we believe we do need to address the entire 11 million or

so undocumented immigrants here that family unification is an important aspect of immigration reform. the question for us with this particular question on these particular children to us is a little different than their parents simply because the children didn't break any laws. and so i just don't see how you can address the parents who did break laws of that particular group differently than you would address all the other parents of children who broke the law. that needs to be addressed in a bigger package of bills that we believe that you're working on and that we are hopeful you will continue to work on. and that this particular aspect of it, just these children become one part of the entire package that does ultimately assure us the status family units speak so you can support comprehenisve immigration reform? >> yes. we support a full immigration

reform. >> let me get these questions out before my time, ms. rivera, ms. velazquez. and talking both about the pain from separation of parents or the pain that young people have? why don't we start with you, ms. rivera. the pain that you are experiencing even though you're over 21? of not having your mother here. i assumed she is in colombia? >> yes, ma'am. >> the pain of not having a mother here in the united states. >> it's very difficult. it's the little things, birthdays, celebrations, graduations, weddings. also the things that, you know, become harder and harder. it's having to see my sister, who is unable to visit her, suffer. and to see that the only way she can interact with my mom is through a computer camera. so it's incredibly difficult.

as i said in my testimony, it effected me while i was in school. i had to reach out to my college of liberal arts, my counselors, and let them know what was going on because i could not concentrate. i was a college undergrad student trying to understand immigration law, which is just about impossible, filing paperwork. so it's very difficult. >> ms. velazquez? >> i can only imagine what it would be. not having my parents with me. my younger brothers, yeah, it would be devastating. and the pain in the community existed with several families in the state of arkansas that are now battling that. i can only imagine what parents would you like to leave their five u.s. children and having to go back to places they haven't been to in a long time. we also have another case in fort smith whether hernandez family has to do assist in children.

one is three years old commander parents are in a detention cell waiting to be deported. and i can see, i can see the pain in her eyes, that she has whenever she talks to me about her dad and how much she misses him and playing with them. so just the thought of not being there, and even at my age, not being there with him is terrifying to me. >> thank you, ms. velazquez. >> let me thank the chairman very much. unyielding packages and congresses duty is to fix these kinds of problems, even if they are pretty tough. i think and i yield back. >> the chair would now recognize the lady from california for unanimous consent, then the gentleman from nevada who has waited patiently. >> i would ask unanimous consent we make a part of the record statements from the congressional specific island american progress, the first focus campaign for children. the american civil liberties union, the national immigrant justice center, the asian american justice, the

anti-defamation league, national education association, ywca and the church world service as those of the statements on citizenship from the evangelical immigration table, and a poll from last week from the gallup organization on immigration as seen by americans. >> without objection. the gentleman from nevada. >> thank you, mr. chairman. i want to associate myself with the remarks of my colleagues from texas although i wish tranelevetraneleve n were still here. i wanted to talk to him on the record about teaching people to drive. we will skip that part. during the course of this hearing we heard things about i don't want my children -- parents left behind so this doesn't happen again. the package, comprehensive, all over this town to find comprehensive. everybody has gone straight on what the problem is now and

rightfully so. but we don't have that luxury of just concentrating on that. your circumstances have been well represented. and i tell you what, quite frankly i personally believe the hardest thing for anybody to do is go back to the people that they represent to say we did nothing. does anybody on the panel think that what's going on now is okay and nothing, status quo is okay? record should reflect nobody answered in the affirmative, correct? okay. so now let me ask you this. i want to ask you to branch out the on your personal circumstances, want your parents together, all that other stuff which is understandable of human nature, what was, and i'll start with you, ms. velazquez, do you have any knowledge of what the thought process was when your mom, if i recall correctly, i miss part of the, said you know what, i'm going there and i'm staying and i'm taking my two year old, the age doesn't really

matter. and i'm asking the question in the context of, because one of the toughest things to justify is okay, in 86 they do with it. here we are in 2013, we're going to deal with it. hopefully, we should. but now that some of the indications, now 10 years down the road, 15 years down the road. how do you make sure that nobody comes here 15 or 20 years from now it has to sit where you are and tell the stories about that, what is the peace. with all due respect, the border -- there's a gulf and the two coasts and there's nothing up there north of met -- montana called candida. what is your thought, how do you make sure this doesn't happen again? once we deal with this group, any suggestions? >> well, i think that's your responsibility, congressman. i think you all hold the answer to what we're going -- >> and i appreciate that but which, to i want a copper hit a thing, you can't say but i've got nothing to give you on the other part. here's what want you to do for

me. i mean you can but then you risk whatever we come up with. i think it would scare the heck out of you. ms. rivera? >> thank you, congressman. to answer the first part of that question, you know, columbia in the '80s and early 90s is a very scary place to be. you know, my parents did what i think any parent would do. what i know what i would give my children, they tried to give us, yeah, every opportunity and they wanted to get us out of there because it was just so dangerous. so to now address the second part of your question, it's very difficult to say, you know, how you fix this problem. but, you know, i know that you guys are incredibly talent and they know that you may think that is a copout, but i really think that, you know, sitting

and talking this out you can figure it out. >> thank you for acknowledging that and the fact of the folks on the south side of the building should have a shot at that, as will the folks on the north side of the building. ms. mchugh, any thoughts? what have other countries than? what do you do so you just don't keep turning the wheel and having new groups that are disenfranchised because our current system isn't working? >> i'm not involved in a lot of these different areas of work in my organization but you may be aware that we -- analysis of both interior and border enforcement systems. we have done comparative work looking at how other countries are handling these issues. also, we've done a great deal of analysis of -- >> really, i've got a yellow light. briefly can you summer? >> i know there are no easy answers. >> thank you. and in --

>> a great question. there'll probably always be some people here illegally. we're not going to ever get 100% security at that point. but certainly the workplace is a large draw, and if you can put in some kind of e-verify for most employment circumstances, that certainly will deal with a lot of it. we need a better way to track visas as well so folks are not overseeing their visas. to me, it's offensive that folks who gave the word that they would under a certain amount of time have chosen to back out on the word and overstayed their visas. to me that the concern as well, so you should address that as well. and then, of course, border security would help as well. >> thank you, mr. chairman. >> thank the gentleman from nevada. the chair will not recognize himself for five minutes of questioning. dr. duke, i never even thought about taking new testament but several of my colleagues have made reference to the bible and i'm almost positive a couple

named joseph and mary immigrated according to one of the gospels egypt when herod was looking for their son. it gets into the gospel of matthew. i want to ask you this. because this is what kind of vexes me from a family standpoint but i want you to imagine, i never understood why god preferred esau over jacob. and i never really understood why they killed the fatted calf or the prodigal son went the other son had done it exactly right. exactly what you're supposed to do. he didn't go and squandered his fortune. he did what his father asked him to do. so imagine a couple in colombia with a daughter every bit as bright and engaging and beautiful as ms. rivera. and they did it the way we asked them to do it. what are the equities of jumping anyone ahead of them and lie?

>> congressman, thanks for the question. it is a tough question. answer questions about except that understand those particular situations in the bible are still being debated and will be until the lord returns, i'm sure. so you're not alone in trying to sort through some of those things. i think that the reality is, we have a situation that nobody wants, it's a real situation that we're dealing with and we have 11 people here. we cannot continue to allow them to live in the circumstances they're living in. it's not right for them. it's not in our countries best interest so we need to address that if we're going to secure the borders, if we're going to trap 11 million people here, you better forget way to stop us from simply consign them to lives of poverty are bare subsistence, and their children and their children and their children after them. so it's a more practical question i think at that point, what you do with folks who are in line trying to get here when you already have 11 million

here. you could see aubrey have 11 million your you have to address and those other folks now at least there met making a living wherever they are. at least they have some degree of support wherever they are rather than us trying to drive these other folks out of here. so we have to address this situation. we can't simply ignore it and asked as though it doesn't exist. when we do talk about getting on path to a legal status, from the legal status or so and for citizenship, they should get behind the line. they should get into the line for everybody who already has their paperwork in. whenever their paperwork goes into should go in and be active after all of these other folks who have already applied in the process. so some folks will be a long time in the process unless you want to speed up how quickly we can process people for citizenship. >> ms. velazquez, i think all of the witnesses have made reference to 11 million. i hear it everywhere i go. it's a fix homogeneous group.

we know it's not. he made reference several times to the 11 million. would you agree with me that those members of the 11 million who can't pass a background check shouldn't be on a path to anything other than deportation? >> maybe the people that don't pass a background check but if you believe that there should be a pathway for the majority of -- >> well now, that's very different from what you said earlier and that's kind of my point. my point is, all 11 million can't pass any background check. all 11 million of any category of people from preachers to member of congress can't pass a background check. so why persist with the talking point of 11 million when we know that's disingenuous? all 11 million don't want to be citizens. all 11 million can't pass a background check. and even if you can see that then we get to the details about the background check is going to look like. for instance, if your city where

mr. amodei a city, if you have a conviction for domestic violence, should you be on a path to citizenship or a path to deportation? >> well, i can only argue or my sake and my parents sent -- >> no, no, no. no, no, no. with all due respect to advocate on behalf of 11 million aspiring americans. you are not a difficult fact that it. ms. rivera is not a difficult fact pattern. so the talking point of 11 million aspiring americans, i'm not interested in the. i'm down in the details of what does a background check look like. do you think a conviction for domestic violence should disqualify someone from the only path to citizenship or status? >> i think i'm going back again to that's up to you all to decide, and -- >> welcome if it's up to us then why do i constantly hear 11 million? if it's one monolithic homogeneous group? why? why not just say what you said? >> their --

>> which is there are subgroups which want different levels of scrutiny. for instance, children were brought here with no criminal intent, that warrants one level of scrutiny. the parents who brought them here who can fashion criminal intent warrants another level of scrutiny. those who have missed the new conviction that one level of scrutiny. those of multiple misdemeanor convictions have a gentle level of scrutiny. those who have felony convictions have a different level of scrutiny. why is that not the more honest response than to talk about 11 million aspiring american? >> honestly i'm in no position to tell you deserves a wide. and i don't know what you do, how would you decide that 1% that the other doesn't speak well, it's not hard for me. i spent 16 years prosecuting people for domestic violence. that's a disqualify her to me, even the most states consider it a misdemeanor. so with all due respect, the devil is in the details are the bright line, people don't have

any trouble with it. the devil is in the details. i'm out of time. i'll just say this, i'll have -- all four of you were very good persuasive witnesses but even if i don't agree, necessarily come with everything that's said. i think you're here in good faith. you contributed to the debate. when i see quotes like i did today from someone named dan pfeiffer, who apparently works for the present. i think it's the same and five at the said once a law is irrelevant. and he tweeted out today that our plan is to allow some kids to stay but deport your parents. he summarize this entire debate with that tweet. so i want to compliment you, and thank you, for not being a demagogue, ma self-serving political hack. who can't even be elected to an advisory committee, much less congress, which is what mr. pfeiffer is. i want to thank you for not

being that an understanding these are complex issues where reasonable minds can perhaps differ. and with that, on behalf of all of us, i think you for contributing to this issue. does the regular wish to say something and conclusion to? >> now. i would just say that i do think once again the witnesses for the testimony, and i think that it has advanced the cause of justice forward. and you're right, these are complicated questions. but i think you're also right, they are not so public it that we can't figure them out there and so i would just like to pledge once again my interest in working with the chairman to reform the laws. they are ms from top to bottom, and hopefully we can fix them from top to bottom and i yield back. spent i think the gentlelady.

>> mr. chairman? >> yes? >> we appreciate it. to know whether there will be a series of hearings where we now move to full committee? or what do we, can we perceive to be the next step? >> i appreciate the question and i can't think of anyone less qualified than the lowest member on the republican side and turned it. but i'm happy to check with chairman goodlatte and get you an answer. >> thank you, mr. chairman. i yield back spent with your indulgence of like to come down there and thank you in person. with that, we are adjourned. [inaudible conversations] today, political host a discussion on how states will have about health insurance exchanges.

representative michael burgess, former kansas governor mark parkinson from a former administrator of the centers for medicaid and medicare services, mark mcclellan, will be among the panelists. cli starting at 8:10 a.m. eastern here on c-span2. >> the senate homeland security committee will hold a confirmation hearing today. see the hearing live starting at 11 a.m. eastern on c-span3. >> they would come up as close as they could and then go into an assault which meant that they would -- they would come charging in at our first lines, and doesn't matter how many casualties they took. those who went down were

followed by a new wave. many in the new wave had the weapons. they just picked up those who had -- and they kept, i force the numbers, trying to push us out of our positions. they say it was one hell of a fight. >> this weekend on american history tv on c-span3, commemorating the 60th anniversary of the korean war armistice starting saturday morning at eight eastern with one veteran's eyewitness account. followed live at 10 as president obama and defense secretary chuck hagel h2b out the korean war memorial to americans who served. american history tv every weekend on c-span3. >> house insurance committee chairman mike rogers warns that cyber espionage is the biggest national security threat america isn't quite ready to handle.

his comments came during an event at the international institute for strategic studies. this is the 45 minutes. >> introducing congressman mike rogers. i'm steven simon from the executor after of iiss as the u.s. welcome to the iiss as u.s. can you hear me now? deafening. i'm executive director at iiss as u.s. i'm introducing understand mike r executive director at iiss as u.s. i'm introducing understand mike rogers, and with a great deal of pleasure. congress and rogers was elected to congress in 2000 that he came to congress from an unusual background. defense and law enforcement but he was an army officer and the fbi special agent before coming to the u.s. congress. he now has a very important and pivotal role in the house as chairman of the intelligence community. house intelligence committee.

intelligence community as you all probably know does the authorizing for intelligence activities and functions and oversight capacity, as well in this respect, congress and rogers has done quite well shepherding three bills to completion of those four. and all the while developing a reputation for bipartisanship, which and washed and nowadays is quite a rare and special thing. congressman rogers has no grasp the nettle of the cybersecurity issue, which has loomed very large of light. and it's an issue with which the institute itself, i i ss is closely associated. so with that i would like to bring congressman rogers to the podium. he will speak for essentially, as long as he wishes to speak and then we will follow up with q&a and wrap up in an hour.

congressman. >> thank you very much. well, good morning. thanks. i ran a little behind. someone i barely hacked into my gps. come on, lighten up, people. i do appreciate the opportunity or director, thank you so much for having me here. what i think is probably the biggest national security issue that america is not quite ready to handle. and that is cybersecurity, cyberattacks, cyber espionage. as chairman of the intelligence community, there's a lot that keeps us all up at night. my theory is by the time i'm done this morning, if you can't sleep tonight, then we are even. that's good thing. one of the things look around the world of the troubles in trying to do with now, certainly in unstable egypt and certainly uncertainty there, syria, there is no good option in syria anymore. we're just playing for our best worst option in the syrian circumstance.

the russians have played a more aggressive role internationally. they have dropped in the water some very sophisticated nuclear submarines. we haven't seen that since the 1990s. they are aggressively playing in the world, and sometimes to what we think is good policy in places like syria and others, when it comes to their blocking the united nations and other places around the world, iran. so you look at what the chinese are who are aggressively pursuing, have been increasing their defense spending, 13% per year since 1989. by the way, when people make the comparison about our military versus any other military in the world, our two biggest expenses are personnel and health care in the united states defense department. and other countries, china included, doesn't have that burden. so when they say 13% per year increase, that means they are buying new technology, getting

leaner and more sophisticated in their military operations. they have aggressively talked about not having the u.s. navy and the south china sea, which we have been there for 238 years, roughly. mainly because 40% of the world's trade goes through the south china sea. so we've got a whole world that we look at everyday, al qaeda, certainly al qaeda in the arabian peninsula, all things that we worry about. loose nukes. we've spent a lot of time trying to figure out that counter proliferation issue in our committee, and then that one thing that we have, we all understand those issues. they are well seated in history, and things that maybe the locations have been changed. the problems have changed, but now on the front is cybersecurity but it's something that is really unknown in the annals of what we would understand as our normal national saturday framework,

structure and conversation. we're going to have to change that. we are trying to change that. there's been some pickups in a changing that particular dialogue. so you think about where we are. you have the hacktivists now who people of political motivation who are hacking into sites, bringing sites down trying to make their voices heard. through i argued illegal acts on the internet. you have individual criminal law costs are trying to get in and steal anything they can that is not nailed down and used to their advantage. your id, your social spitting on your birthday, credit card number if they can get it, steal what they can, move onto the next victim. organized crime on the internet, which is a growing threat. as a matter fact that credit card in your wallet will get hit, the country itself will get hit about 300,000 times a day for people trying to get in, mainly from eastern bloc organized criminals, to try to get in and steal a block of

numbers in a bigger way in order to steal both personal information as well as your credit card information, and turned it into a criminal profit. we have the next level up, certainly one where talked about frequently, chinese primarily, economic espionage, where a nationstate has geared its military and intelligence services toward this single focus stealing intellectual property, taking it back, repurpose and that intellectual property and competing illegal against both u.s., european, asian companies, of which they sell that property. huge problem. keith alexander, the director of the nsa, has called the probably the largest transfer of wealth illegally in the world history. many believe it's pushing $2 trillion in value of lost and

stolen intellectual property. so these are the blueprints of companies. they can win. they spend as much time as they need to spend. they will have his long process of threats. they will lay there as long as they need to define specific pieces of intellectual property to steal and bring back again for repurpose them. what we're finding is, i talk about the chinese, other nations do. nobody comes close to the level in comparison as the chinese when it comes to theft of intellectual property. they have certain sectors of the economy of which they will identify and then pass on to their units who are designed specifically to steal that particular intellectual property so when you get up in the morning if you're the i.t. security guide for filling the by, could be a manufacturing sector peace, they could be a pharmaceutical or biological peace, it could be a military peace of hardware. it could be on a trade deal. you get that list of companies and sectors that you're supposed to target until you are

successful in penetrating. if you're the i.t. security guy, that is an ominous list to be on if you can imagine. the weight of that has got to be overwhelming. that you as an individual, small or medium or large business, is responsible for defeating a nationstate in its economic espionage act every day. that's why we are losing this fight. not because we don't have great i.t. guys, but i will guarantee if a nationstate dedicates its intellectual capital and resources to getting into your network, eventually they're going to get into your network. but that's the problem we are facing what it comes to can him of espionage. me give you one of the bad piece, and it is on this. we have seen this especially in china where some of these very enterprising young cyber hackers who are designed and trained and employed by the chinese government, either the military or civilian intelligence services, to steal intellectual property, they're very good.

they spend eight, nine, 10 hours a day doing the work for the chinese government and then they realized this recovery that is on that list but your way down the list of why not pick up the phone, call the company and say, i'm free nights and weekends for a little cash, i'll be happy to spend my time trying to get in and get that intellectual property. so imagine this, we understand our problems that, let's say it's 10 people and half of those people have decided they will do this on the nights and weekends. they have just increased their ability for cyber economic damage to the united states, our european allies, asian allies as well by 50% overnight. this is a huge problem. and the reason they think they can go there is because there has been no consequences. and i mean no consequences to their economic espionage. it has been a free reign and a free run. you think about that china needs to grow at six, seven and 8% a

year just to sustain their economic social programming. they're not doing it by innovation. they are doing it by theft. we are the victims of that. we will be lucky to grow at two, 2.5% this year just to meet their numbers, 7%. they are not innovating at 7%. again, you can do the math and understand where those jobs, where the economy, where the prosperity is coming from. places like the united states, and other innovative economies around the world. very, very dangerous stuff. so, then you look at the last level that concerns us all. this is the stuff i talked about in the beginning. many called it the digital pearl harbor or other things to try to think get people to understand the gravity of what lays in wait for us, and that is military style or terrorist style cyberattacks. for the sole purpose of creating chaos, causing damage, punishing their enemy.

when you look at where we are today, the reason this one is so concerned is because so many nationstates are not gaining in capability that we just hadn't anticipated in the past, or seen in the past, and the rapid increase in the capability is concerned. some we think is coming on their own. some because they're getting the tutelage and comfort of others come and maybe even other nationstates were giving them the capability. so we know military style plan is alive and well and will be with us as long as with computers in our lives. that day has come and gone. there is no turning back to the russians we so use it in estonia when mr. putin was apparently upset that they took down a statue of a soviet soldier from the square. remember this? in about 2007. and it was a devastating and just about ruinous cyberattack. it was a form of political punishment to the small country of estonia. i'm a, it serious, serious

consequences. we saw the russians using it began in a military style planning when they invaded another country. imagine that cyberattack is the new battlefield before the airplanes dropping bombs and artillery shells landing before you sent in your troops and your tanks. now before any of that happens you're going to see a very aggressive cyberattack to be as disruptive and cause as much chaos as you possibly can to imagine in a small town people coming and trying to get gas, can't do it. pumps won't work. grocery stores, all their cooling units go on electric grid is off-line. you can't get cash from your bank, your financial institutions are shut down. you can imagine what chaos that causes in a very short order. and it is troubling indeed. and as i said, that's with us for ever more. it was an interesting public report offered by kevin handy

and who talked about much of which we knew in a classified setting for quite some time. they were able to identify a particular unit that had both intellectual property designs and goes up -- but also going after things like our electric grid to find that long persistent threat and go with it get into that system. not because i don't think the chinese are going to turn off our electric grid, but they were just getting ready in case they ever needed it. in case they ever need the opportunity to shut off our electric grid. which sounds a bit orwellian, but again a life and will. so if you know the russians have that capability, certainly the chinese have the capability. and it was troublesome to us that they have been so persistent about trying to find places to lay malicious source code into our electric grid so if they ever needed it, they could shut it off. dangerous in and of itself.

so this last piece, which is concerning, where you saw north korea go across the border, attack both some businesses and a financial institution. and they had more success than we anticipated that they would have, so that concerns. how do they get the capability where they got it? it wasn't up to the same standards as we might see in other nationstates, china, russia, others, but of a significant which means they are rapidly increasing their ability to conduct mischief around the world using cyberattacks. why is that a problem? not necessarily a rational actor in a national economic stage as we have seen. so they are pursuing a nuclear weapons program with vigor, and now they are pursuing a cyber warfare capability that's concerning. and we watch them use it in a way that's very concerning to the south korean neighbor. lastly iran. we have seen some very, very devastating efforts on behalf of iran. one of the things that caught us

off guard on their sheer capability for destructive attack, something called saudi aramco. you know the saudis and the iranians have been at each other for some time. they have some strong differences. they attacked saudi aramco men because it was the largest clean house weekend to oil payments and other things. so imagine leaving on a friday, coming back to your office and 30,000 machines, computers, are not just off. they are broken. you're not going to turn them on. you are not getting data off of them. they are paperweights on your desk. there were able to get in and something called the filesystem an absolute damage the system so your computer would no longer initiate. it's worthless. and not likely to cover the data, be pretty difficult to do on your best day.

most likely you're never going to get any of that data off of that particular computer. huge, huge problem. they also destroy data and then they manipulated data. so in other words, instead of me owing you $100 in my records, it's the other way around. and i don't know how you go back and try to find one that. if you imagine you're engaged in international commerce and all your lectures, ledger sheets which is hard for me to say definitely, were turned around in this particular case. very very, very devastating. so here's what's worrisome about that. we know that the iranians have been aggressively pursuing from we call them probing actions on u.s. financial institutions. the sheer number of these cases targeting u.s. institutions in the united states was traveling a month ago. it's more than troubling today. it has gone unabated.

what we found was that it is not their best work but we know that they have the capability that has not been used yet in these particular type of attacks. these were a sophisticated denial of service attacks. so they're trying to shut down the banks ability to process transaction. they had some limited success in this, at least the first go around. enough that it concerned our financial institutions. and by the way, they're probably the best at protecting themselves from these kinds of things because they had been engaged in trying to stop theft, well, since dillinger decided he wanted to rob banks. and then into the digital age people tr trying to get in, remember the old scheme to round off the 000 and put it in an account? boy, whoever thought we would long for those kinds of days in bank theft in the united states. then what they did is they were

able to shut down certain banks, one particular financial institution told us that just the loss of transaction time and the mitigation try to keep up with what their attack was caused one particular thing over $100 million. one financial institution, one attack. not their best work. that ought to make everybody sit up a little straighter, at least not enough what i don't sleep at night. as the chairman of the intelligence community. we have certain financial institutions that clear transactions on a daily basis of $8 trillion globally. imagine if somebody is successful at causing that some problems, as we move forward. it would be devastating. and here's the thing why we have to get this right, and i'll take, i want to take questions can have a dialogue. if people move -- lose faith in the internet, just won six of our economy today in the united states, one-sixth to think about

how much he do from shopping to banking to communication today on the internet. it will only get more engaged in your life, not less, most likely. but what if we lose faith in the internet as a commercial tool? one-sixth of our economy. won sixth of the innovation that is happening in our economy happens through the internet. and internet-based applications. if america says we are done, we don't trust it, we're going to stop online banking, stop online shopping, i'm not putting my credit card on there. we've got huge problems. huge problems. and it only takes one. if they are successful at one major financial institution, i'll tell you, these folks are swimming. they are keeping their heads above water but that water is rapidly rising. and here's the thing. this is the common myth that the government protects these networks because if you read in the newspaper, the nsa is listening to everything you do,

avenue to talk to you in the fourth or in the back. i see in those enough, very disturbing. kidding of course but the problem with that is the u.s. federal government doesn't have any way to monitor the tax that are hitting the private sector portion of the networks. just don't see that the only way the nsa, acey ducey overseas first. you don't catch all of those all the time. and so if we don't get our act together here and create some way to share malicious source code and real-time to stop this, eventually we're going to be on losing end of this equation. and we can only see so often we are most innovative and everyone else that we can keep innovating our way past the folks were innovating against us, places like iran or north korea, nonrational actors, or we can do something that would allow the federal government to share some very sensitive malicious source code with the private sector so they can protect their own

networks. not that the nsa would be monitoring those networks. that they would share a malicious source code attack of the federal government would not see normally so that we can react in both protect our government networks and then maybe helpful in finding out what the origin of that particular attack was. this is a serious eye problem as i've ever seen but, unfortunately, the most recent event have clouded our ability to get our arms around what's happening to us. and how we actually move forward to defend ourselves and protect i argue are the last place on earth we will have a free and open and energized internet. if we don't do this the right way, shame on us. the next generation of american father very different different attitude toward the internet and we will look at it as that one open window in a very dangerous neighborhood. that is no place to be. as we move forward. so with that again we can talk about anything that you would like, and we'll open it up to any questions that you might

have. >> please tell us who you are when you ask a question. >> [inaudible] >> i am from the embassy in a stone of. [laughter] might want to tell your story and thank you for being vocal about cybersecurity and keeping this topic on the table. at cybersecurity, there is a clear need -- [inaudible] what are your views how this can be a most efficient way? and at the same time, there has been a bit of -- [inaudible] with the private sector here in the states. do you have any ideas how to include also -- [inaudible].

government-to-government or more wider international operation, cooperation globally? >> well, just kind of finished recently a series of meetings with our international partners in the eu parliament, trying to find a way with the disclosures of the snowden incident it raised concerns and fears hit by the way, most of which were based on inaccurate information. of the biggest part of that was first of all we need to get the facts on the table so we're making decisions based on what the facts are. not what we think is happening. that was really important. so what we have decided to do, matter of fact we're going to have a small delegation from year ago with the eu. we're starting with the eu because we think that makes the most sense but it's the second most integrated internet commercial zone, if you will, in the world. we thought that would be the

next logical and appropriate place. and that concerns about how we partner. we want to make sure we get all that work out. the government can't do this on their own. the united states doesn't have the kill switch on the in the. i argue we should not have a kill switch like china, like russia, like iran, like north korea. and so we have to partner. the solution isn't a government solution. it's really a partnership, sharing and other things. and we need to do that here first. we are to come and at the same time have the dialogue with first our european friends and then try to bring as many of the g20 nations, knowing that some of our biggest cyber adversaries live in the g20 nations. we have to start building it out. my argument has been, we are in a cyberwar today. most americans don't know what. they go about their lives happily.

that's a good thing. other and the fact that we are in a cyberwar today. your nation felt i think it first bigger and harder than any other nation. you have made history and it's not the history you want to make. but we are in that fight right now every day, and we haven't protected ourselves yet. so as we go with this dialogue with our european allies, and i met with the chairman of the justice committed does all the data privacy, where we're trying to work through some things. and then we push it out to the private sector across the eu. it's hard to have that dialogue if we can't have a sharing arrangement even with our own private sector folks here. this is a private sector generated economy here when it comes to the internet. so are networks are privately sector runs, protect and driven and argue that's the right way to do it. that means let's have a uniquely american approach to this that

protects privacy, protect civil liberties and still protect our intellectual property. and our national security as well. so we will do that through the europeans and then spread out to the g20. that's kind of our plan as we go out. for any other report here, you should grab the estonians. they are ahead of the curve when it comes to cyber protection, mainly because they have lived through such a tough time on their own. your ambassador is fantastic, and she should get anywhere she can because when she shows up, she wins converts. she is really good. [inaudible] >> yes. yes, sir. >> my name is mike. i'm a native of michigan so it's great to see you so interested in the subject. there was a dhs report became a a couple days ago and was quoted in "the wall street journal," talking about how the sequester might affect some of the cyber

projects that are ongoing, especially conferences and other critical network infrastructure that activities. so how is the sequester going to affect cyber, in your mind? and what we do to make sure that it is not affecting major come into, our activities in a major way? >> two things. eight, the way sequester works is just a terrible way to run and who is heavily weighted in nashville this. i think that was a mistake but at the end of the day when you're really talking about 2 cents on every dollar spent federally, that's what the sequester amounts to, 2 cents on the dollar. how many people think we can't find 2 cents in the federal government that probably shouldn't be spent? i argue we absolutely can. by the way they did it is a push most of the funny, as i said, into line items in defense which i think it' is again a mistake t i'll tell you why, so we have

the most, there are different lines, and one of the ways we conduct oversight, a very sensitive program is that that money is not isolated in authorization for intelligence funding than it is even in defense. so when you take 17% which is some of these line items get hit 17%, not to send, but 17 cents on the dollar, that's a huge difference. i got crunched down. so i will give you one great example. one particular place we have a line item for helicopter fuel. you take 70% of our ability in this one particular line item for helicopter fuel, guess what? some helicopters are not flying. that's a huge problem. that's not a good way to manage a. in that regard it has been harmful. on the side of things, i've been trying to protect those budgets for the last couple of years. we have grown our investment in cyber, mainly because we know what's coming and we know what threats, the threat matrix was

bad five years ago. it's worse today and it's going to be really bad in and of the five years. so we've tried to protect a. i think we'll be okay. they may miss a conference or two but the effort on cyber i think will be, continue to be robust because we've made sure we protected and ou our budgets knowing that' that sequester was likely to happen in the next year. all the way in the back. >> [inaudible] about 18 years ago there was a report for cyber terrorism and cyber warfare. [inaudible]. that was 18 years ago. [inaudible] the chinese in the next decade about 10 years ago. so why have we waited this long?

>> well, we waited this long to the public dialogue, which was unfortunate. there were things that were happening over the last decade or so, but i will say something. i got on the intelligence community as a member in 2004, had my first cyber briefing. and at that time it was, attitude was, well, we will show you what a threat matrix looks like. we will go to that in some depth. this is a problem but it's a problem with india with. oops. what happened was i think, i don't know if it was complacency or just lack of interest but at that time we were at it again. there was nobody even close. that quickly turned. that first, by the end of the first five years of me being on the committee, that threat had flipped 180° to come a, we are losing this fight. we went from i think we've got is handled, to all my god, we're losing this fight in a big way.

that i think are a lot of people offguard, and again we were technically at that time i do believe that we were well ahead of our adversaries. that's no longer true. then the dialogue of how we get public support, none of this works if we can't get public support. i think we've seen that with the recent leak stories coming out. if the public doesn't understand and buy into what we're trying to accomplish year, it won't work. that's just not who we are. so tried out the public dialogue, was it three years ago we had, my counterpart and i, ma we decided together, we going to go out and we're probably going to talk about the world's greatest threat when it came to cyber espionage and intellectual property theft, china. we were the highest government officials at the time to actually announced to the world it was china.

and we couldn't find businesses are willing to go in front of the committee and say they have been hacked, even if they knew it was by china. because of the fear of repercussions, the fear of trade issues, all of the think you can imagine. and it was very difficult even three years ago to get people to understand and talk about the cyber problem. this is a relatively recent phenomenon that you can even get someone to come out and give a speech on cyber. this is not a sexist stuff that we deal with in the intelligence community. it's awful important him and i think that's what happened. so we are a little behind the curve and the fact that we are ahead, fell asleep, got surpassed and now we're trying to catch up. we select to bring to public in. the public generally, i think, just because again they don't have access to the information, is really unaware of the sheer volume and threat that faces us every single day from our governments to our businesses your job by cyber espionage and

cyber hacking or so just a matter now of trying to change the dialogue. .. >> from corporations in america sitting on the sidelines than we do today. and it kept witting to get -- waiting to get back in the market. that's why all the corporate balance sheets have been fantastic. they're not hiring at the same rates, if at all, and they were waiting to try to figure out what did this new series of regulatory actions both in health care and finance mean to

their bottom lines. and so they held and reserved cash. so that had nothing to do with cyber effort, but i will tell you, you can be sitting pretty well today, but if my innovation, my research and development for that product tomorrow that sets me apart, if the next generation of ipad or that next new, cool techno gadget is stolen, that's hard to measure in real terms. it's very hard to measure in real terms. but let me try to do it. many have made the public comparison about the f-35 fighter, it's our newest, latest, greatest fighter, to give how you an example. in the middle of that whole thing, expenses jumped pretty dramatically, right? and then you saw pictures in china of something, that's funny, looked exactly like our f-35 fighter. how'd they do that? don't think it was coincidence. and that cost jump, right? this was a big fight in congress

about this thing is well over cost. maybe you can draw a parallel. someone might want to draw the parallel publicly that maybe if we had lost by cyber theft all of our stealth technology on that aircraft, it was no longer a stealth aircraft, and maybe we had to redesign it at a significant cost to american taxpayers to keep, say, a fighter like the f-35 stealthy and the most premier aircraft in the world. to me, you know, some would draw that public parallel. i certainly might not do that, but some might draw that parallel, and that's a real cost in real dollars. and then you start going down these companies that actually lost their whole company, a company which was supposed to be an e-certificate, right? so when that shows up at your computer and says this is mike rogers they certify, yes, that's mike rogers. here's a company within just a very short time span went from

this growing, new e-commerce kind of a company, was actually by a iranians got into that company, they did something called a hand in the middle. i won't -- a man in the middle and hijacked those certificates. now, at that time the iranians but using it for political persecution back in iran. they wanted to know who certain people were talking to, so they hijacked the company's ability on these certificates to say who it was, and it was really the iranians listening in to your conversation, reading your e-mails. that company was gone in about nine months. so hoors this growing company -- here's this growing company, boom, gone. how many jobs lost? hard to measure. what would the value of that company be today? hard to measure. that's gone. i always get the name wrong. it's american superconductor. i got the thumbs up. they decided to do a joint venture in china. they had a technology that would, allows for the patented

technology that allows for the con version of solar and wind and getting it into the grid, basically n a nutshell. if their ec nears -- engineers heard me, they'd be all over me. in a nutshell. they do all the right thing, they're going to do a joint venture with the chinese government. they about, i forget what it is,less than a year the chinese basically steal every bit of their intellectual property, cancel their contracts, threw them out of the country. that company went from there are 1.6-$1.8 billion in american value to about $170 million, and the only reason it was worth that and the ceo is open about this, is was he had some -- because he had some defense contracts parceled off, today weren't able to get at them. all of the value, all of the employees gone. he said i probably won't be here

the this a couple years. guess what the largest company now is in china that does that? the company of which they stole 100% of that intellectual property. now, these are future companies. these are companies we say, hey, this is the innovation economy. this is where we're going. gone. that's why i think we need to be so tough on this. those big corporations, they've not cash on the sidelines, and their balance sheets are going to look good for i don't know how many quarters, right? hopefully, they decide to put that cash back in the economy, but i understand how they got there, irrespective of what this intellectual property theft is about. yes, ma'am, and then -- >> hi. wendy coleman from the national war college. in your speech you mentioned that china is committing intellectual property theft because there are no

consequences, so could you outline what some of those potential consequences could be? >> you bet. great question. and, again, talk is cheap, right? so anytime we just have a discussion with the chinese government, they deny it, they say we're doing it. so, obviously, we're going to have to change that paradigm if we're going to get somewhere. so there are several thing that i think we can do. one is on any bilateral discussion with china, it has to be, number one, number two and number three on the list. it's that serious, in my mind. we shouldn't get to any other discussions before we get some answers on their efforts on cyber espionage. and by the way, the united states government does not use its military and be intelligence services or any other part of our u.s. government to steal intellectual property to bring it back to give to an american company. it does not happen and certainly will not happen. that is not who we are, that is not what it does, our intelligence services do. not going to happen. so some notion when they get out there and say, oh, the u.s. does

it. no, they do not do it, telling you right now. so that's why we join with other nation-states who don't steal intellectual property to give it back to their private industry to compete in the world market. so the bilateral piece has to be really important. secondly, and we did a bipartisan bill, introduction recently that says, all right, let's start going after the individuals. let's make this really uncomfortable for individuals who are sitting at those machines stealing intellectual property. we're going to make sure they can't get visas to the united states, that they're put on lists that would not allow them to travel to the united states, that we could start looking at financial issues that we could make sure that their finances don't travel and transactions clear through the united states. i think the next level down from that and once we do this public shaming, if you will, of these individuals and take real concrete actions, i mean, one of the things that has -- these folks have to understand there's a consequence for stealing inte

be lek chul property. the next step, i think, talk about looking at and we didn't get there in our bill, the next step would be looking at cowntsz vailing duties for products we now that have benefited from cyber espionage and repurposed trying to get back into the united states. we would have a countervailing duty regime that would headache that nearly impossible for them to compete against u.s. companies here in the united states. if we can do that first piece on visas and other things, the bilateral piece, i think we could have a real impact on this. and, again, we can talk about it all day long, the chinese can do it, after the mandian report i think they were down maybe four days. before that whole organizations back at work. why? huge benefit, no consequences. >> we've got time for one more question. >> be oh, sorry about that. yes, sir.

>> thank you -- [inaudible] federation of american scientists. just let me know -- [inaudible] efforts don't go unnoticed. my question goes to the nature of warfare today. we seem to be understanding -- [inaudible] but an economic sanction and course of action. do you see iran responding in kind if our economy is based on a trust factor, do you see iran as the pressure builds from our economic sanctions going all out on the cyber response? >> well, i think what, i think they're making a conscious decision that they feel empowered now that they have this capability -- and i'm not saying anything, although i would argue that, you know, some of the signatures certainly look, have a hint of miss coviolate in them welcome -- i think that they make the

calculation that this is a legitimate response to sanctions, right in and so that's why they're targeting our financial institutions according to public reports. i argue they've probably made this conscious decision, hey, we've had this wildly successful event which was wildly successful by any cyber attack planning, and they've decided, all right, the pressure's on which is why i think it makes them such an irrational actor on this stuff. our capability is getting better. we're going to do these probing attacks in retaliation for an aggressive sanctions regime. now, you know, obviously none of this has slowed them down in their pursuit of nuclear weapons. we're going to have to have an honest conversation with ourselves in this country if what are the consequences of allowing a country that is already aggressive in cyber warfare and terrorism against u.s. targets, that is already responsible be for at least i

think dod predicts or estimates about 600 u.s. soldiers dead in iraq and afghanistan because of iranian complicity. this is the nation that tried to kill the saudi ambassadorred in washington, d.c -- ambassador in washington, d.c., right? and so far they've suffered the same kind of problem, very little consequence. and we're going to have to have an honest discussion. i know we have it frequently down in our spaces about what happens next when you have a nation that is so brazen. imagine that nation now gets the umbrella of a nuclear weapon. we should ask ourselves some hard questions about what that means. now, they're aggressive now, can you imagine that umbrella of a nuclear exchange option which many believe that would mean that they could unleash their conventional and unconventional forces in a way they haven't even done yet today in a way that would be devastating and disruptive. and be when you talk to our arab

league partners on these issues, they are more aggressive about stopping iran getting a nuclear p weapon, clearly, than we are. and i think even the rest of the world is. this is a very large, very looming problem that we're going to have to get our hands around very soon. they've done nothing through negotiation but buy themselves time and, clearly in that time they've moved the ball down the field and, obviously, these really gripping sanctions haven't deterred them. think about north korea. great example. we nearly starved a nation to death through sanctions -- i argue they starved themselves to death -- and they pursued a nuclear weapons program because they believed the benefits outweighed the benefits of a starving nation. that's a hard equation to break, but we'd better figure out a way to do it. thanks for having me. [applause] >> and live now to a panel

discussion on the progress of -- [inaudible] in implementing the health care law with congressman pike l burgess and former medicare and medicaid administrative mac mcclelland. this is just getting started. >> there's a mic going, okay. thank you for coming to us. we're live streaming as well. it's a timely moment, we're going to talk about state enrollment and some of the aspects of the aca happening on the ground. that helps. and i'd like to thank cvs caremark, the pro health care breakfast briefings, and here to say a few words is the executive vice president and chief health care strategy and marketing officer. >> thank you. hi, jo ann. no, i'm good, thanks. [inaudible conversations] we're really thrilled to be sponsoring this event and to have such an esteemed group of participants on the panel.

the affordable care act has been described as one of the most complex implementations in the history of the u.s. health care system. and i think that that's in ways why october 1st is starting to feel like tomorrow to so many of us in this room. i recently heard someone say that this program is somewhat like building a bridge from two different sides and hoping that it meets in the meddle. middle. and i think that's really an excellent description, but i think one of the things that this bridge building has done is really brought a lot of people together from the government sector, nonprofits and corporations to try to figure out how to make it work. so one of the best ways for us at cvs caremark to make that connection is fill the knowledge gap that exists, we released research that shows that 36% of people who are likely to enroll

in the health care exchanges need more health and information as they think about all of this. even more striking about half of those people who are, in fact, eligible for subsidies don't know that they're eligible for subsidies. we also found that overall awareness is up at 74%. in other words, more people know at least that this is coming, and they're prepared to do something. at cvs caremash, we serve over five million people every day, and we feel very strongly that our 25,000 pharmacists and 2500 nurse practitioners can play an important role in the helping consumers navigate all the this complexity. so what we'll be doing over the next several months is working hard to create a national information outreach program which are include events and displays in your stores to help can customers enroll in these new plans. 68% of the people that we surveyed actually just expect pharmacies to be able to provide

them with exchange-related information. i'm sure system of our panelists would agree the aca implementation is going to be complicated, but we certainly believe that with great experts like we have today, they will help us figure out how to really build this bridge and make the program work for all the americans that we can serve. so without further ado, i'll pass it back to jo ann. thanks very much. [applause] >> thank you so much for the or partnership we've had with you and for making these events possible. and you can tweet your questions, the hash tag today is hash j prohcvb, and i will be tracking twitter from the questions from the the tablet, although you all know i'm not so good at that. [laughter] i got it right last time. without further delay, i'd like

to welcome our panelists. we've got representative michael burgess who's vice chairman of the subcommittee on health. good morning. >> good morning. >> ann got yea, senior program director for the national academy for state health policy, mark mcclelland, marian finish. [inaudible] the director of public reform programs, and former governor mark parkinson of kansas who is now the president and ceo of cal. good morning, thank you for joining us. we're going to have a panel discussion s and we will be taking questions from the audience and twitter. okay? let's get started. when we sat the panel, we wanted to get experts who had a national overview and some who had state-specific knowledge. some of what's happening on the ground this themes of the mechanics in terms of what's

going well. and also it has become a red hot political issue. it was never not a political issue, but i think it's really sort of risen back to some of the intensity that we saw before. so i wanted to get from the three of you, first of all, from the states, one question is a little bit about we all know here what the rhetoric's like and what the arguments are like in washington. how intense is it, have you seen the same spike in intensity back home? i think it's probably sort of an easy question for you from texas, but let's start. >> short answer to your question is, yes. i want to give people a moment to check their programs when you introduced me as a republican from texas, there was a, wait, i thought this was a health care briefing. >> you're also a physician and member of the house doctors' caucus. [laughter] >> who canceled on you at the last minute and you got this guy? [laughter] but i also wonder why i've been inviting to these things because

i've been absolutely wrong about everything i've told you so far. i told you no bill would come to the house floor, through the senate, that the president will sign, supreme court will take care of it, big election, that'll take care of it. wrong on all accounts. >> one of our editors was just as wrong. >> but i think as i watch both up here and back home, to tell you the truth, back home you're not seeing a lot of activity because texas has said we're not doing the exchange. and, of course, medicaid expansion is not something that the governor has said we're going to do. so even though the state legislature is in special session right now, they're working on other things be and not this. from the washington perspective and be where a lot of the focus has been since the first of the year is can this thing actually get up and running? and while the witnesses who come in from thing says -- agencies will tell you oaf and over again we will be ready, everything's on schedule, then you kind of

look around, and things are falling off as you go down the road in sort of this little trail of debris that's left behind the affordable care about as it bumps and bounces down the road. obviously, the july 2nd revelations that we're going to delay the employer mandate for a year was pretty startling, but it was very startling in the context that just a few weeks before gary cohen had been to our subcommittee and i said can you do this, are you going to have to narrow the scope, absolutely not, we'll be ready 100%. and then a few short weeks later, we're faced with these headlines. one of the most troubling things to me is the concept that since we're not collecting the data from the employers any longer, we're just going to tell, we're going to trust people to tell us the truth. you know, sure, what could go wrong with that? but it is of concern to me. and i hope at some point later this summer we'll do a hearing on the subsidy and subsidy recapture because i don't i donw that people are actually aware

of the fact that january 1 of 2014, yes, there'll be a subsidy available to them. they're just going to be asked how much money did you earn this year. it'd be difficult to know how much i'm going to earn in a year ahead because there are a lot of unknowns. at the end of the year, there will be subsidy recapture. it will be paid primarily through the insurance company, but the individual will be responsible for any recapture then that happens. so there's the still a lot of anxiety out there, a lot of question marks about october 1st. can this thing actually work as advertised? stay tuned. >> let's go to california. is there a trail of debris on the ground in california? >> no, i wouldn't say that, you know? i'm from the left coast maybe in two ways. california has really embraced the affordable care act and has moved quickly to implement be many of its aspects. we have established a state-based exchange, we've given strong governance and and a lot of leeway to influence the

market. and we have recently embraced the medicaid expansion that is available under the affordable care act. so many important milestones have been hit. the political environment is not to particularly divisive in part, of course, because we have a democrat-controlled legislature as well as a democratic governor. but again, i think the stay tuned comment is not out of place in california either. the it's a very complicated with many, many moving parts. a lot will play out in the coming months in terms of how it's implemented in california. >> and, governor parkinson, you succeeded governor sebelius and now you have a very conservative governor, brownback, you've had an insurance commissioner who's wanted to go ahead with the aca implementation and a governor who doesn't want to go near it, and the governor prevailed.

i know you're living here in washington now, but you keep track what's the intensity there? >> well, the politics in kansas is incredibly interested. i lived there for 55 years, and i still don't understand it. thomas frank famously wrote saw years ago what's the matter with kansas and opined that it had transformed itself into a permanent conservative state. he was quickly disproved when kathleen sebelius was elected governor and served for six years, then i finished off the last two years of her term. and now it looks like the thesis was correct because with me leaving, governor brownback was elected who is extremely conservative. the legislature has become extremely conservative and yet there are still elements of moderate politics within the state. so we've had this very interesting dynamic for the last couple of years where the republican governor very strongly against the medicaid expansion and the aca in general, and a republican insurance commissioner in sandy prager who's a moderate

republican who actually supported the legislation, wanted very badly for an exchange to be set up and implemented. and when you pit a governor against an insurance commissioner, guess what? the governor usually wins. and that's what has happened in kansas. but it's been very interesting to watch. >> mark, i'll start with mark, you lived through, survived, choose your own verb, the implementation of mma which was hard and complicated and had bumps. it was not technically as complicated, nor was it politically as devisive. there were some democrats who voted for it, and even those democrats who fought about it in washington, they went home and weren't quite as emphatic in terms of enrollment and getting the low income pop belation in. we're two months out now. how, i mean, in this spectrum of it'll be bumpy, but it'll work too, it's all going to fall apart, do you you know, what's - what do you worry about when you're alone?

[laughter] >> well -- >> share it. >> hard to sleep at night when you're not actually on the front lines implementing the law. so i guess i would say it's going to be somewhere between those two extremes, but that's still a pretty wide margin, and i think it's going to vary from state to state based on some states like california that have done a lot to implement their exchanges, have a lot of outreach and education activities already ongoing versus some of the states with the federal fallback implementeddation that are not expanding medicaid, that have not had as much. the public there has just not had as much exposure to the law. and i think two things that are worth mentioning, similarities and differences between medicare part d implementation. one is to make a distinction between the philosophical and political differences about where our country's health care system should head and what that means broadly for the be mix. and -- for the public. that's an issue where we do have

very different views in congress and throughout the condition. and that's going to continue. want to distinguish that from what the program that's in law actually means as it's being implemented and what i think the public really hasn't focused on yet understandably because they don't have to make any decisions yet is what does this mean for me. and i think there will be some questions. i think republicans, democrats will get these questions in their office locally, they'll refer people to the resources that were available. one big difference in what we did was we did a whole round of outreach and education infrastructure building way before this point in implementation. so that was like a good year out meeting with a range of local groups many of which supported and opposed the medicare modernization act, made it not a philosophical issue, but a practical issue. we want to make sure when people come to you with questions or when you are talking about this law, you know where to go to get

answers for them, and we worked with them to come up with those kinds of tools. a little different approach here, more campaign style, but i think that's one important difference. the other important difference is that medicare modernization act implementation really lasted one season from the fall of 2005 through early 2006. seven million medicare dual-eligible been fisheries, medicare, medicaid switched over coverage on one day. that contributed a lot to the start-up bumps issues that we had, but we worked through them in a month or two, and the vast majority of medicare beneficiaries made a decision, enrolled in coverage by the time the first be open enrollment period ended. that is not likely to the happen in this case. by the administration's, really everybody's projections there are a lot of people who are going to remain uninsured both by their own choice and because they may not have options available because there's not a medicaid expansion at least yet in their state. and so this is going to be a

several year implementation process with more opportunities for debating whether this is the right way to go and probably some more needs for modifications to the program along the way. >> and a similar assessment. you're working with many, many -- i mean, probably all of the states or many of the states. you've talked in the past, i haven't seen you for a while, but i know you've talked in the past about the difference between what the politicians are saying and what's actually happening on the ground. has that gap widened this the states that are quite resistant, or it may vary. there are states that are doing federal exchanges that are still working on planned certification, they're not technically partnership, but there's de facto partnership. so what do you say when you land -- see when you land somewhere or on the phone with someone as opposed to what we're hearing at that big building over there? >> let sphe start with the old adage which is if you've seen one state, you've seen one state. there's a lot of variation.

but that having been said, i think i can talk about groups of states in groupings. there are the states that have embraced reform, the state-based exchanges, and they are working hard, and they are going to be ready for opening in october. the directors, and we work closely with them at gnash by. i spent a day recently with five of the ceos of the exchanges. these are people who are not in it for a job. they are mission-driven, and their mission critical is to get the doors open, if you will. but it is not going the 2.0 version that you're going to see over time as improvements are made. it's going to be offering options for coverage for the folks that are eligible with a lot of creativity in terms of the outreach and in terms of the way that they're connecting with the consumers. then you have the states that

are the partnership states or that have defaulted to the federal government, and even there while you don't have a lot of activity necessarily at the political level, you've got state employees who again are civil servants and have a job to do. so let me take insurance commissioners in all of the states. their job is to protect the consumers in their states and be no make sure that the coverage that they have is quality coverage and that there are no ill-toward things that are going on. and they take that job very seriously in all of the states. some of them have taken a step further, so for example, they understand that there are going to be questions when the federally-facilitated exchange opens, and they're prepared to answer those questions and field them. some of them are even looking even in the astronaut of kansas to -- even in the state of kansas to what they could

possibly do to make it easier for consumers to understand their choices in kansas. the medicaid departments, almost all of them whether they are expanding or not have put in new eligibility systems in order to make it smoother for implementation, and they too are looking for a better customer experience. so at the implementation stage, and remember this is the law of the land, they're working hard to implement it. >> before i get a little more state specific because i want to go back and ask mark a question as someone who you were fda, you worked in the bush administration, you're an economist, you're a physician be, you're an administrator, you're an academic, you're all these thicks. when you watch but you're not in administration -- in this administration, but when you watch sort of like i've been through this, what headaches you like say don't do that, you know? what would you, you know, i don't know how much advice you

give them or how much you talk to them. what to you say, oh, no, no, no, not that again. >> well, yeah, i don't have that reaction during the evening news that off -- >> because you don't watch it. [laughter] >> i think -- >> metaphorically, right? >> metaphorically. i think there are three times coming up when i might have some of that reaction. one is in september and really to some extent already when you see the results of the policy decisions that have been made. and that's what plans are available. you know, what coverage are people going to get, how much is it going to cost, how good does that look? and i think that is also going to vary across states with states that had a lot of insurance regulation or are already doing community rating, maybe having less adjustments, states that were way out in front on this like some of the state exchanges may be having a more comprehensive set of plans. but we'll see when the federal fallback plans are released in september. i would point out, though, that in contrast to part d there are

a number of people who already have individual or small group insurance coverage and are not or noting under all the rules -- are not operating under all the rules of the federal fallback exchanges or the rest of the law now who probably are going to face some changes, some of which will be significant premium increases. so that'll be something to watch in september. next thing will be how well the systems work, and we'll see the version 1.0 of that on october 1st. states have all made a lot of investments in upgrading their medicaid i.t. systems, they've gotten a lot of funding for that, and the administration seems to be trying very hard to put all the, at least many of the pipes together, the ones -- they've deferred some, but as dr. burgess already mentioned, putting the pipes together. there's a big difference between how information technology works in theory and how real world, messy, incomplete or other side incompatible data that hasn't

haven't really had to flow together and morph together work in practice. and there are going to be a lot of issues around that. so we'll see how big those are in october, and then there's education and outreach. i think there are a lot of questions about how well people are going to do in the terms of finding out about this and especially for younger, healthier people how they're going to make decisions. so those are the kinds of things i certainly have some opinions on, but those are the kinds of things i'd be watching to make sure i've got metrics i can closely follow. i talked about having a war room in the administration. that war room functions best when they've got timely, up-to-date, strategic, actionable information. and that's what i'd be focusing on right now. do i really have the intel on the ground the know how big some of these problems whether it's policy or systems or education outreach, how big are these proms, and -- problems, and am i in a position to quickly respond when they do arise? >> okay. let's go to october 1st. everybody in this room understands that this is a process. even when it was less politically heated, it was

designed as a process. nobody expected to have 0 million people -- 30 million people sign up on day one. there's going to be a snapshot quality to it on october 1st, and there's going to be again in the first week of january when, you know, do you have your insurance card, can you get care. now, it may not be -- it may dribble out a little more because not everybody will be getting care the first day whereas more, i'm guessing, more seniors did need prescriptions in the first few weeks or tried to get something --? if you've got a serious, chronic disease and you miss your medication that day -- >> right. there's a smaller subset of people who are going to go on the day of new year's day. governor perry has said he's doing no outreach, you're not doing medicaid, he is sort of symbolic of the resistance, opposition, choose your word. what happens in texas on day one, on october 1st? do people sign up? to people just say this is the worst thing i've ever heard of,

or do they say, what, i've never heard of -- what do they say in texas? >> you do get a lot of that reaction. just to pick up on mark's point that he made earlier, medicare part d was much more pragmatic and focused on let's get the pills to the people on january 1st. this is much more political. i mean, i don't know anyone in rural america, you hear about them, you read about them, obviously, their focus is going to be on a number. thai already released -- they've already released the number, it's seven million people. about a third of that have to be in the young invincible category in order for the economics of this thing to work. so i would imagine that they are focused very much on getting to that seven million number as quickly as they can. i'm not here to advise it in rural america, but if, okay, it's no one's going to mislead about their particular situation. i've got a large state with a large number of uninsured that's not doing medicaid expansion, i'd make sure they all have

income levels that qualify for a subsidy. now, it'll all have to be sorted out at the end of the year, so i think there's going to be some difficulties there, but if at the same time the only metric is the number and right now that seems to be the case, there is, i would expect a lot of activity in a state like mine -- not seeing it right now, it may be happening under the radar, the advantage is not only do we get someone signed up for insurance, we get paid on a per-head assignment and, oh, yeah, we also get them on our voter rolls so that at some point in the future this may be useful information to us. so a lot of things happening at once will, but you don't see a lot of it happening on the, you know, just not reading the articles in the paper, you're not seeing people talk about it on the evening news, the local radio stations. they're talking about the nsa and the irs and all the other thicks -- >> politics at the moment. so are you basically saying, are

you seeing, is there evidence that they are just looking for poorer people and saying forget about your income, and we'll worry about it next year? >> i'm not seeing that, but i would wonder if that wouldn't evolve naturally as a business model simply because, okay, we've identified what success is. secretary sebelius has said it's seven million people, and you need to get there pretty quickly in order to say, look, this thing is working just as we planned. you know, the old sutton's law thing, rob banks because that's where the money is. >> california. october 1. you have it very differently, you're doing much more outreach. i don't know if that gives you navigative programs already up, you're doing messaging, it's a totally different political environment, yet you also have hard-to-reach populations, non-english speaking. you've got plenty of young invincibles, so the obstacles

are similar in a different political complex. what happens when it starts in october? >> it's hard to say until october. in fact, california is investing or will be investing a huge amount in outreach and enrollment. although the full campaign has not launched yet. so there are very big investments that are going to be made by cover california, california's state-based exchange, to do outreach for targeting, generally speaking, the population that's expected to be subsidy eligible. there is also going to be a very large campaign funded by another statewide health care foundation from california endowment targeting primarily people who are already or anticipated to be medical-eligible, being california's medicaid program. those definitely need to be well targeted and focused. there's going to be a huge outpouring of money. the question will be how effective is it at targeting people who are eligible and then

how receptive are people to the messages that are presented to them, you know? it's hard to say yet, but certainly a great deal of thought and energy is being put into these very questions of targeting to ethnic populations, dispersing gee graphicically and targeting where the highest pockets of uninsured are. partnering and giving assistance, for example, through, for example, state university systems that have sort of natural affinities to younger people and people with families. so a lot of thought is going into this. the proof will really be when people receive that message, what do they do? are they activated? do they go to coffer california or to another source to learn more? or -- and when they get there, do they find an attractive set of options at prices that are ato ford bl and with conditions that are understandable? and i think that's a huge question about how people really navigate that and how they engage with that in their choices. >> to the the the extent that

you see what's going on in kansas october 1. i know that you're here -- >> sure. let me say i realize the metric is can we add seven million folks that aren't insured right now. i really think, though, that the future and the success of the aca will be dependent on metrics that impact folks that already have coverage. and so the thing that i look at the most is the cost issue and the access issue. proponents have said that we can do this major expansion, and you won't lose your coverage, you won't lose your choices, and your costs will be roughly the same and maybe might even decline. folks that have argued against it have said, hey, you're not going to have your choices, and your coverage is going to go up dramatically. if, in fact, costs go up dramatically for people who currently have coverage, i think the political dynamics are such that it will be very difficult for the law to remain the law in the long term. on the other hand, if and the proponents are correct ask people can still go to the same

doctor they've always gone to, i don't think it matters how long it takes to enroll the new people. it will happen eventually. if the law is in place long enough, eventually, the medicaid expansions will continue to occur, eventually folks will get enrolled, and people aren't going to say, oh, we need to get rid of it because we only signed up two million instead of seven million. order, if costs go way up -- on the other hand, if costs go way up, they're not going to care -- >> can i add on to mark's point real quick. so seven million previously uninsured people, that's a significant impact. it's by no means all of them. another important number that the administration's talked about is that the vast majority of americans who have coverage through a larger employer, who have medicaid already or have medicare already, the president likes to say you're not affected by this at all. but just to get back to mark's number, seven million may seem like a lot, but if you look at people who have individual coverage now plus people who

have coverage through small businesses now, it's a much larger number than seven million, and those individuals and small businesses are going to be significantly affected by the law. the chises they have now -- choices they have now are going to be replaced by the choices in the individual and small business with exchanges, and i think that is an important point to watch. >> when you hear seven million, i might get five different answers, is that seven million who are currently uninsured, or is that seven million who have some -- who include -- is that seven million who go into exchanges who might be in the individual market now? >> i don't think that number's been broadly defined. rather, it was a broad definition. we expect to have seven million people sign up. but mark, the governor's point is exactly correct. when we're having this discussion, 11, 12, 13 months from now, the unintended consequences, the impact on price which occur september, october of 2012 just before an election time, that does have the potential for a significant political drag.

>> '14, not '123. >> i'm sorry. i'm still focused on 2012. i can't get over it. [laughter] 2014. and the, you know, people come see me off line all the time who work in the insurance industry, and they talk about the same things that mark just mentioned, that, you know, the cost to the individual who has something now, their choice and their price point may be significantly different a year from now. >> and you've been trying to say something. >> i'd like to take us back to the focus on october 1st and january 1st and the number of seven million. because i think that that is, while the news may want to pick it up, i think the messaging, it's important for leaders to message that that is not the critical date. look back to october 1st is when things open, and it is likely that the numbers will not be met right away. look back at when the chip

program went into effect in 1997, and it took significantly longer for enrollment to happen than originally planned. that said, i think that's almost more analogous than medicare part d because it was folks who didn't have insurance as opposed to the medicare population that was in. although i'm not saying we can't learn a lot from the medicare implementation. we certainly can. but in the intervening years, there has been ab awful lot -- an awful lot learned about how best to reach the kinds of people they're trying to reach. we've had a social media revolution. we have had a lot of research in the haas couple of years that -- had a lot of research that states have done to understand how to reach the target population, and i'm kind of excited about what bringing some of those techniques to the outreach enrollment may have. but i want to emphasize that the state leaders that we talk with

on a regular basis you said that this is not a -- understand that this is not a sprint even though it really feels like one right now. >> feels like a multiyear sprint. >> exhausting. but it's really a marathon. and it is the longer term improvement of the health care system getting more people quality coverage and more affordable coverage that is the promise on the up side of these reforms. >> is -- when you look at the the states, and this is for mark and ann, and i think somewhat nationally, too, so chime in -- you always knew that the states were going to be different, you always knew this was not designed to be totally identical even before the medicaid element. states were going to have a certain number of choices and decisions about how to shape their exchanges, who governs it, standards for letting plans end, you know, whether it would be a little more utah, a little more

massachusetts. you never thought all 50 states would look the same. the gap is much, much broader not just in terms of the medicaid, but, you know, in countless ways that we can't list here. how, how uneven do you think the results are going to be? i mean, six months, a year from now how different is it going to look? >> so i think that there is unlikely in this vast country to be one mod to el that works -- one model that works perfectly, and there could be multiple ways that an exchange is governed, ways that it reaches its consumers, ways that it actually goes in version 2.0 and helps to -- similar states are looking ahead to really impact the quality and the delivery system with choices they make in the exchange. i think there could be positive or negative outcomes for patients with different models.

and what's important is that we length the lessons of what's working and doesn't work and spread them quickly so that those who come behind can adopt some of those practices. >> i also wanted to ask, want to come back to the enrollment exchanges. i also wanted to give governor par parkinson just a couple of minutes because the fighting and the money is focused on enrollment and coverage. but there's the other 900 pages of the law depending on which edition you're looking at, the size of the print, does it affect how care is delivered? he is working with chronically ill and disabled and elderly. and just talk about, you know, briefly and we're going to come back to the exchanges, but i want imto talk a little bit about that negativing elected, you know, that overlooked part of it. a few things that are interesting that either wouldn't happen without the health law or wouldn't be as advanced, and then we'll fight more about it. >> i think that's a great

question. i think it's also a very underdiscussed topic as it relates to the aca. we tend to think of the aca as just an expansion issue, but when i talk to my old boss about it, secretary sebelius, others at hhs, they will argue vehemently, no, this is also getting at cost and quality issues as well. and be so, you know, i'm very fortunate to have the position now where i run a trade association for nursing homes and assisted living facilities. the holy grail of payment for providers has been what can we do to reduce costs and at the same time keep quality the same or hopefully improve it. and there are some parts of the aca that get to that. there are dual demonstration projects across the country are now spreading where we're trying to take care of folks that are eligible for both medicare and medicaid at the same time and figure out if by coordinating that benefit we can reduce costs and keep quality at the same level. accountable care organizations are popping up around the country to try to coordinate benefits and, again, hopefully keep costs the same or lower

while at the same time increasing quality. a lot of these things are happening, aren't being discussed nearly as much as the expansion topic. but in the long run are kind of, you know, may have a very large impact in moving along that whole movement of higher quality or lower cost. >> is there one specific ram in one specific state that you just get really excite about? >> well, i tend to get more worried than excited. [laughter] so we have these dual demonstration projects that have combined the medicare and medicaid benefit in a very big way in california. that will roll out next spring. we have the accountable care organizations that pull postacute providers together with hospital to try to coordinate that postacute care, and it's both a threat and an opportunity. if we can figure out how to do this right, it can be a terrific thing for providers and for beneficiaries. but we could also make some major mistakes and have some very poor results.

so we're actually more focused on that part of the aca than we are on the expax. expax -- expansion. >> and is the medicaid expansion or lack thereof going to create sort of more unevenness in this world? >> not really. it doesn't affect long-term care providers as much as it would for hospitals or for doctors or most other providers. so in our niche, no. but in the broader spectrum, absolutely. you talk to a hospital exec in a state that's not doing the medicaid expansion, they'll have a very different outlook than a state where they are doing it. >> okay. we do have a twitter question, and i will remind people it is probe hcbb, and the question is someone mentioned the campaign-style education, and the question is how has it helped and, i think for you, you might want to say how has it hurt? california first. how has this concept of a campaign played out? >> well, i think, actually, that was ann's comment and, again

can, the campaign in california has not been fully launched. i will say it is extremely important to watch how it works. i think there will be huge lessons learned. but to give people a sense of scope, the california exchange is going to invest about $100 million in a public affairs campaign over the next couple of years. and it will, you know, doubtless informs huge amounts in trying to target and focus that, but that is a huge amount of money even in a state the size of california. so, you know, again, the targeting, the outreach to populations that aren't well informed and aren't searching will be huge. will it work, you know, we will see when people, when it's really on the ground and in place. >> campaign as public education, there's also campaign as a political con no connotation, and i think that's part of what this question is getting at. in rural america there's people

closely associated with the white house, it is unlike mma, it is still very duh visive -- divisive, and you don't have people at home actoffly, you don't have in -- in 2005 there were some democrats who really didn't like it or wanted to change it. i don't think they hated it as much as we're in the stage now. but awant to modify it -- i want to modify it, we all heard it every day, but they would go home and have more of a proactive outreach. i don't know of my republican that's going to -- there may be some that i'm not aware of -- i'm not aware of any republican who's proactively -- the difference between taking a question and saying, here, i'm going to help you sign up. i don't know of any. >> could i address that? >> yes. >> there would be no mechanism by which you would know how to do that, because the information coming out of the administration has been so sparse be and, obviously, i don't attend the

democratic caucuses, but i rather expect that's something they talk about as well. they just had a big con fab this week about, hey, this thing will actually be your friend down the road. but there is very little information that's coming out of the administration, and that is actually in context with the way this whole thing has happened. there weren't governors down at the white house when this thing was crafted. there were other special interests, but the governors whom you're going to depend on for this thing to work, they were kind of cut out of the program. where was the governor of indiana, mitch daniels, who had delivered care in his healthy indiana for his state employees and cut costs by 11% over two years? seems like they would have chained him to the table until he spilled the beans on how he did that. it was with a health care deductible savings model, even if it wasn't their own money in the first place. so, you know, there were a lot of opportunities that were missed.

then again, it's not my position to advise the administration. i'm sure they wouldn't take it anyway. but those opportunities are continuing to be missed. >> yeah, just a couple points about campaign. and california's a good example of doing a large-scale public outreach campaign, i think 100 million, and that's just a fraction -- >> that's the public affairs by -- [inaudible conversations] >> broad-based education and outreach efforts. there is a different strategy here that's much more modern campaign-style microtargetting that is not what happened for pote technological and i think other reasons in 2005, 2006 with medicare. i don't think we could have done it. the social media, internet technologies didn't exist then. i would say, by the way, that that's a two-edged sword. it is a way of reaching people faster, but there is a lot of information that the administration, others can control that will also spread rapidly as the outreach and other activities occur, you know, if any enrollment problems

arise. >> right. if you were relying on twitter as your educational source for enrollment, you would have a lot, 140-character issues. >> yeah. and i guess the second thing is to dr. burgess' point as well, our outreach and information infrastructure was head by a mixture of people -- led by a mixture of people, some who supported the law, some who didn't, and it was focused up a year before on information that's reliable so people can make an informed choice. we asked them what is it you think your seniors, people you care about, your moms, your family members, what did they really want to know, and it focused on that. it was not a campaign strategy style of identifying, okay, who is likely to benefit or at least potentially be a target for this program and how can we microtarget them. there's a next step to this. this is not the same thing as just, you know, getting somebody out to vote. it's one thing to get them to

engage and look at the information, it's a second thing to help them make an informed, honest, fact-based decision about what does this really mean for me, and is it a good idea for me to sign up. and that's not a typical campaign decision. it's a thoughtful decision. this is going to be much more challenging than just, you know, deciding what to buy on amazon or which hotel to book. this is more like deciding on a mortgage for your house. something that's got big financial consequences and depends on your current circumstances. that's not a campaign strategy focus be, that's an education, personalized information tool focus that needs to accompany finish. >> and that is happening in the states that are imelementing their own state-based exchanges and in the partnership states that are doing the consumer assistance. and at the federal level that are developing the web site and the consumer assistance for the federally-facilitated marketplace. so there is, while there is

campaign-style trying to reach folks going on, i don't think in my experience with the people i'm talking to in the states, there's nobody that thinks that's enough without having this other really important education that needs to happen. and it's not easy to figure out how to tell people to understand their choices. everyone in this room and out there knows that explaining information is a lot -- insurance is a lot different than explaining the newest features of the latest smartphones. but there's a lot of work going into making that simple, and none of us here knows whether that's going to work well. >> do we have audience questions? i'm not sure who has the mic. if someone has a question, signal, and we'll get you a mic. >> coupled with all of this are the funding battles that are going to go on. >> we've got one over here. please introduce yourself and make it a question. >> my name's kevin, and i'm

asking about the taft-hartley self-insured plans. will they have to become real insurance with the raising of the lifetime limit, the lifetime cap? thanks. >> who wants to take -- >> i didn't fully understand. >> i didn't want either. >> for union taft-hartley plans. they do under the law need to comply with all the requirements that insurance plans have to comply with, so -- >> annual caps and lifetime caps is what you're asking about? lifetime and annual, the answer is, yes, they have to comply. >> whensome. >> starting 2014 there have been a number of questions from a unions about that -- from the unions about that, about whether taft-hartley plans can qualify for subsidies like individual or exchange plans can. i think the answer to that is no, but this'll be one of the many areas where there'll continue to be questions raised. the current law and current administration policy is, i believe, yes, they have to fully comply. >> other questions?

no one else in the room? twitter? i'm -- the only one i have is the challenges of the aca, and i think that's probably what we've been talking about for the be entire be time. how, i guess i have a selfish question this terms of august. how hot is it going to get? i should tell you i'm so well organized and prepared that i sent my husband out to buy the school supplies yesterday. [laughter] i'll go get the right ones next week. [laughter] >> seriously, shakes your confidence. ..