the governor has so chosen not to do it for two legislative sessions. we have tried to show them that there is a local tax base that is time for a lot of things for low income people already. now, what the legislation's position has been, they want you to expand the medicaid waiver so that they can continue offering medicaid through an hmo, but they don't want under the aca to expand that medicaid population up to 138% of poverty. so, we have shown them in an ingenious way that you can utilize, if the state doesn't want to pay their 10% in the

fourth year and the future years, they can actually utilize what is already being used in a local property tax or sales tax for these low income people. .. for these low income people. so, what i would ask, if the state chooses not to expand , what wouldto 138% you think the department would plan to handle be state's rick state's request to continue with business as usual? >> senator, with regards to the specifics of the discussions thaten hhs and the state, is something in my current role i am not familiar with. what i can talk about is the

philosophy of how to think about these issues in terms of medicaid and medicaid waivers. there are a couple principles. i think it is important starting the conversation to be clear about what the fundamental core principles that are essential to implementing our, whether that is the affordable care act or state waivers other states may be applying for. i think the second thing that is an important principle is flexibility. differentates have situations and we need to consider that. bringing both of those things together something we need to do at the beginning of the conversation as one works through how to get to a potential yes. >> ground zero for medicare .raud is south florida just yesterday, there was another bust. law enforcement took down 50 more people. the problem is, in the past, when you take them down, they

have already fleeced the system. you got any thoughts? >> a couple things. i think we need to work to a system that is not pay and chase, but it in front of the system, where the dollars go out. that is where we need to have a system. there are a number of tools we need to use. we need to use tools that we use in the private sector in terms of predictive capabilities, in terms of using technology. i think the department that did do the work you are referring to yesterday was an across the nation strikeforce with the justice department. that is important for doing that. in my current role as omb director, the issue of improper payments is one that has been focused on across the entire government. as we know, the numbers are very large and medicare. it is a place where we need to focus deeply. i would hope to bring some of the focus we have done on broad and proper payments across the federal government to the issues that are specific and medicare

and medicaid as well. -- senatorgordon gordon -- cornyn. >> thank you for meeting with me and my staff and my office and talking about getting away from pay and chase. there is not enough resources in the federal government or in the federal claims act or otherwise to go after all the fraudsters. the only way to get ahead of them is to screen who gets paid on the front end and there are a lot of very powerful and loud people who will complain to high heaven if you do that. but i appreciate your commitment and chase,h pay because it just doesn't work and it will work. so, mckenzie, who you once worked for in addition to other aspects of your distinguished career, has come out with a testament that about 22% of the 8 million people the

administration was celebrating and rolling in the exchanges, people whore previously did not have insurance coverage. which meant that only about one out of five people were newly added to the insurance rolls, who previously didn't have coverage. the president said when he sold the idea of the affordable care act, if you like what you have, you can keep it. down $2500ms will go as a family of four. and by the way, if you like your doctor, you can keep your doctor. hasoo many instances, that proven not to be true. which is been very damaging, not only to the president's credibility, but the credibility of anybody who is saying the affordable care act will work as advertised. -- to my knowledge

there have been no official figures released by the federal government or by the administration. are you aware whether there are any figures available which withadicts or disagrees what the mckinsey study estimates that only one in five of the 8 million people did not have insurance? >> senator, in my current -- senator, in my current role, i do not know. we have seen the mckinsey numbers. the question is, some people may have switched for quality reasons. i'm not sure if they divide out. the other thing we have seen, we the numberallup and of other organizations show the percentage drop of the number of uninsured in the nation and those provide different numbers. with regard to the specifics of the government, in my current role, i do not have access or no.

the insurers are where that information will be provided. >> the distinguished senator from west virginia who earlier, whou talked for 20 or 30 years -- i do not know if he was suggesting it would be 20 or 30 years before we got health care right or not. maybe we will have that conversation later. there are a lot of people who feel enormously discouraged. you in the short time i have remaining, my notes indicate that health and human services employees -- employees soughly 78,000 people -- employ roughly 78,000 people. there's another government organization in the news these days, the veterans administration, that has 278,000 employees. if the reports are to believed

-- to be believed, they are having enormous problems delivering care to veterans who have earned that right. could you tell me how you would deal with an organization that has these sorts of problems that are being reported in the va today? i realize that is much bigger than what you are getting ready to take on at hhs. i am not asking how to fix the how yourticular. but would approach an organization that size without many problems? >> first, i think you need to get into what is causing the problems in the magnitude of the problems. you quickly have to establish is the problem coming from? is it systemic? is it cultural? is it a targeted problem? once you understand what kind of problem you're dealing with, you

have different types of solutions. if it is a cultural issue, you have to do change management. that takes energy, effort, leadership, by ian -- buy-in. if it is a target of space, that is a different problem. is the problem, theagnitude of it, and other thing is sending culture, sending signals and important parts of doing this. >> do you think >> with regard i think there is role that congress and executive branch play together. there is important oversight role that the congress plays and i think that is about a back and forth in a conversation and i think it is one of the places working together is the way to get the greatest impact because i think coming up with the solutions i i think listening ad

understanding that there are ideas that come from experience that's on the ground, i think one of the most important things in my visits that hear is you represent what happens in your states. what i hear when i ask you for, when i have a conversation and ask you about priorities, it is a means by which one hears from the american people as directly as you can. so i think there is an important role in how one goes about that doing these solutions and working with congress to do it. >> thank you. >> thank you, senator cornyn. senator menendez. >> thank you, mr. chairman. congratulations on your nomination. >> thank you, senator. >> yesterday "the star-ledger," major newspaper in my state of new jersey, reported that while 140,000 people were successfully enrolled in medicaid at least another 25,000 still have their application waiting to clear the backlog and another 7,000 are waiting for their medicaid cards. now i realize this is problem solution lies

predominantly at the statear level, but, i also know cms has a vital role making sure states bet all applications processed in a timely manner. if confirmed will you commit to prioritizing this issue so families in new jersey and across the country can rest assured that their medicaid enrollment has been processed and they're able to receive the care they need and have cms wori to educate individuals andd providers about theirth presumptive eligibility rights so they are able to receive and provide health care waiting for formal enrollment? >> senator, if i am confirmed i would look forward to work bug and cms on that issue. >> because the promise of the act, if at the end of the day you do everything right and register and can't apply and. you're not just processed at the end of the day is really unfortunate. as you may know from our conversation new jersey has the highest rate of autism citizens in the nation, with one in every

48 children diagnosed by the age of eight. why one of my top health care priorities is insuring that individual with autism have the therapies and services they need to fulfill their god-given potential. now one of the steps i took to try to achieve this goal was insuring autism services were required under the essential health benefits package for plans sold on the health insurance marketplace. despite this requirement, however, i'm worried that plans are not living up to the standards that i envisioned when i wrote this provision into the law, especially in states without existing state coverage requirements.e specifically, i'm concerned that plans are taking advantage of the regulation that allows them to use nondollar caps on benefits since they no longer allowed to impose dollar limits. so this is clearly in violation of the intent of the provision as i authored it and as part of the law, has the potential to

denyal access to care to familis across the country. cans assure me under your leadership hhs will conduct the necessary oversight of planned benefit structures to make sure they'rel providing all of the required benefits. >> senator, thank you and appreciate your leadership in the space and our conversation about o this in issue and if i m confirmed i want to work to figure out how we can make sure those children and adults arepa receiving benefits and health care that they need. >> okay. two last questions. one of the final issues, one of the issues i've been involved with over the last year is responding to what cms so-called to midnight rule which is designed to create an unambiguous policy that beneficiary i spending more than two days in hospital is designated as in patient however the rule fails to acknowledge an instance where where a beneficiary needs a high level of in patient care for shorter amount of time even if the physician determines it is medically necessary or

appropriate. now i'm pleased to see that cms took the initiative ander soliciting comments on this issueti as part of fy 2015 paymt in patient rule but i'm afraid a year might not be enough time and once current delay is over and thet we'll still be in a situation where the rule is unworkable and unenforceable. will you provide that cms will have policies in place will assure rule viability once the statutory enforcement delay expires next year? >> senator, if i am confirmed this is issue i heard about from aab number of your colleagues in all of my visits so this is one where i think we need to continue getting best ideas people have for implementation and that is something i hope, if i'm confirm can work with cms and others to get that input. >> okay. thanke you. finally, delivery system reform and quality improvement. you know, when those of us who supported the affordable care act we saw it not only about

having more health care familieslity for across the country who didn't care, about controlling costs but also about changing the nature of our, from a disease-based to a preventative-based and changing nature how we paid and how we dealt with health care from alternative payment and delivery models, bundled payments, patient-centered medical homes and performance and outcome. i suggested multidosing when appropriate to reduce prescription drug costs. so are you open to these types of initiatives as a primary effort to try to change the nature of how we pursue both our ott comes and how we pay for them? >> senator, i think that the delivery system reform issues are very important priority that we need to focus on and i believe the way we are going to focus on, them by taking exampls and models we start to see and

figuring out which of those provide the best quality and the best cost and then, which of those we can scale quickly. i think it is important to get things in place, start to get traction on changing the system to one that moves towards what you described as quickly as possible. >> thank you.s >> thank you, senator menendez. >> thank you, mr. chairman. miss burwell congratulations on your nomination and taking time to meet with me. we have of course serious disagreements about the substance of obamacare. as i conveyed to you in our meeting i'm more concerned at moment, well, i'm very concerned about the substance but since we can't change that, but i'm very concerned about what is going on with regard to the enforcement oft obamacare and the selective enforcement of obamacare with regard to certain groups. we've seen exemptions, delays, parts of the law ignored as they pertain to certain favored would appear political groups.

one of those is the self-insurance tax which was imposed on self-insured, self-administered plans to help pay for covering people with preexisting conditions and under yourmp direction, at o-mb there was a rule issued that carve as lot of plans out from that tax and i guess my question has to do with, you know whether or not that is appropriate and whether or not that is fair? i want to read for awe quote that came out shortly after the rule was issue. asked for clarification how the change would affect other plans rates and fees for 2015 and 2016, health and human services officials said, it is true that the fee will be higher for plans that do not have to pay the fee in 2015 because some plans are except. so, in your view, is that an accurate statement, that others are going to have to pay a higher tax, the self-insurance, reinsurance tax i should say that is paid by self-insured,

self-administered plans because groups like unions got carved out? >> senator, with regard to the specific provision that you're referring to i think this does fall into trying to improve and find better ways to implement the law. the specifics, while some unions are, this does apply to some, many unions it doesn't apply to, and it applies to other groups. it has to do with the definition as well of self-administered versus third party administered in terms of what the a law was trying do, the question of there are places they're not synonymous l terms, the reason they're not because what we found moving forward there are actual plans self-administered not using third party administered. creating a distinction was a way to provide better clarity. that was intended in terms of what was being done.y >> my understanding it doest affectdi 25% of union plans. it is something that i believeed that they requested and so, but the question is really very simple one.

doesn't require a lot of subjectivity. simply a function of map. if there are groups exempted from the reinsurance tax, does that mean those subject to the tax will have to pay higherec taxes? think the question is what was higher and what was lower is the question of one is implementing what yourim startig point is. yes a smaller group but what was the actual starting point in terms of what is higher? >> we know what the tax is supposed to raise. it was a finite amount. itur was very clear. if you raise certain amount of revenue and paid by a certain number of peel. if the pool shrinks people left in the pool will pay more that a is simple math. ipe think the answer is yes andi would like to hear you say yes. >> senator, i think with regard to what was intended was to implement the law in a better way, that was common sense, that was responding to a situation that was not just unions but whatever the size of the pool is to get the numbers.wa >> is again mathematics. are people going to pay more? the anticipates is yes. and that's what i'm saying when

it comes to this issue of selective enforcement. i don't think that is fair. i mean you've had, you've had exemptions now twice for small businesses under the employer exemption. you've had, i think 20 some exemptions or delays or otherr that have beenw sort of waived unilaterally but this particular provision is really problematic for the people who still have to pay the reinsuranceav tax. and all i'm simply saying is, as a matter of fairness and way that this is implemented, carving out favored groups shouldn't be, you know, the modus operandi. we ought to be going about this in a way thatou treats everybody fairly under the law and i don't think you can argue based on number of exemptions, number of carveouts and number of delays issued already that iser the cae and this particular one was a rule issued by omb under your direction. >> senator, with regard to the implementation i think what one

seeks to do, when one find places where you implement better in the law you seek to do that. with regard to the question of employ irresponsibility, what we heard is that the private secton was havingg difficulties in ters of doing the reporting requirements that they would need to do to do this accurately. and with regard to other complex pieces of legislation, one of which, part-d and others, we haven't had anything as large as complex as this in a while butco we have had examples. as one movesgi to implement youo listen and try to implement in a better fashion in terms of trying to hear, listen and make the transition one that is workable. on individual side, what one sees is an opportunity for individuals to apply for hardship exemptions in terms of trying to make that transition be a place that works. >> mr. chairman, if i could, in interest of transparency thougho some ofrt these things, these f waivers and delays, would you agree, to submit, when you get them from the insurance company, the new filing rates that they file for next year? because, you know, the enrollment date has been delayed

now until later this year. the date at which plans get proved has been delayed until the day before the election which is very convenient. we know they're going to be filing rates. we know there will be real world impact on these things. in interest of transparency you talked a lot about would you submit those rates when you get them from insurers? >> issue of premiums and rates i think we all are very interested and want to see directional same way of with regard to specifics whatnk hhs receives an what and how, something in my current role i'm not familiar with and want to get to the department.he what i will say, senator, is if i am confirmed that is something i want to understand and work with you on. >> thankt you, mr. chairman (123)450-6789 thank you, senator thune. just very briefly, miss burwell i very much appreciate your reference to part-d. i was one who voted for part-d. george bush's major initiative. we worked in bipartisan way.nc i hopee we work in the bipartin

day in the days on reference. d. senator cardin? chair burwell. thank you to you and your family. act sets uple care the right structure for quality health care for all americans. there are many divisions of the law i would like to see strengthened and improved and i would hope we could work together to do that. in the few minutes i have, i would like to go over a couple positions we have not had a chance to talk about. i want to get on the record -- establishes all of the to aagencies, elevated nih national institute. there are reasons for that. i gave you the example of

baltimore, a study funded by the institute, where depending on where you live, it could be a difference of 30 years of life expectancy. you know the statistics on individual diseases and differences among different ethnic communities. intended that the focus on minority health and health disparity would be a priority within our health care to deal withg previous failures we have had in trying to do with this. i was disturbed when i looked at the president's budget. there were a few of the , that were nih frozen, it did not get any increases. the institute for minority health was one of those that was frozen. could you share with us your commitment to implement the intent of congress to put a

priority and spotlight on advancements to deal with minority health and health disparities? >> yes, senator. thank you for your leadership in this space. the issue of minority health is important and one that is being partly addressed by the affordable care act and the president's budget. doctors looks at the being trained, the numbers is proportionally represent minorities. and think that is important are, getting providers to the communities where talking about. there is a program to actually promote researchers, minority researchers in the work that nih does. the whole across realm, there are other parts and provisions, whether that is preventative care or community health centers, thinking about how those entities and parts of implementation in care can help minority communities.

important thats you put together a coordinated so we have the confidence that we have made this the high priority it deserves. one area related to that would be the qualified health centers. one of the great stories of the affordable care act is the significant resources made available to qualified health centers. i have visited most of our centers in maryland. they have a hand in prenatal health care. low birth weight babies are down. infant survival is up. we have dental services in the community that were not available. mental-health expansion. all of that as a result of the affordable care act. women need your support to continue that priority. it is not just third-party coverage. it is access to care. i want to ask you one more question dealing with dental care, which is another problem

with minority health and health disparities. maryland, we have the tragedy of the monte driver, who died, 12-year-old not being able to careccess to oral health in 2007. pediatricded for dental. however you can have three stand-alone plans. we have got to make that as seamless as possible. that is, it is an essential benefit. families need to have access to pediatric dental without separate deductibles and limits. will you look into how we can benefit, asseamless congress intended, under the affordable care act? pediatric dental? >> senator, i know this is an issue that you have taken leadership on and senator

rockefeller brought it up in his comments as well. having had an opportunity to work on pediatric dental in my foundation work, that is something i would like to look at, how to get the services delivered to people in ways that they can access it and use it in ways that prevent the kind of problems you described with the 12-year-old that actually extend through adulthood for many. >> absolutely. i look forward to working with you. thank you. >> thank you. senator isakson is next. congratulations on your nomination. congratulations to your family or condolences to your family one way or another. hearing before the health committee, i brought up an issue i already discussed with the chairman. in that meeting i told you i had no more responsibility as a member of the united states your -- noluding

more pressing responsibility as a member of the united states senate, including your the harborthan project. i wanted to bring clarity before you were gone from omb to make sure we had a road forward to make that reality. to confirm what dr. coburn said about responsiveness, without -- in an hour that hearing, your arranged a meeting with your chief legal counsel, your deputy director, and your chief liaison and the under secretary the army corps of engineers where we reached a way forward, which i just want to memorialize with this hearing today. we need to pass the authorization, which is in the final conference agreement. i've seen that. second, the court has to initiate and begin a public

ownership -- partnership agreement and the state needs to agree to forward fund initial construction moneys, for which it will receive credit. do i have a correct representation of the steps forward and collect -- and pleading this -- completing this project question mark >> senator , you have. i hope that the word will pass quickly and we can move forward with this important project. >> thank you on behalf of the people of georgia. and really the united states of america. thank you very much for your responsiveness on that. i was a real estate guy, but i had a little insurance agency in my company. group healthsmall policies, for which independent agents received commission. when the affordable care act passed, it put the medical loss ratio for small determined that the commissions were a part of the

administrative cost of the plan which meant you would have to pay the commission and administer the program out of the 15% which is basically put all the independent agents selling health insurance out ofl business and was a reason why wm had to hire o navigators to help people find their way through the exchanges. i would like when you become head of the department i would like to look at that decision and revisit in terms of the efficiency for t the plan to alw small group salespeople and large group salespeople to get back in the business of selling insurance. it will save costs on government in terms not having to have as many navigators and put people back in business i think unintentionally put out of business by the affordable care act. >> senator, if i'm confirmed i look forward toe looking into d understanding that, thinking about it both from perspective insurers having had the opportunity to have been on a board of a insurance company, i understand the independent agent issue andrs as well as the issue of how we think about premium issues which are some of the issues that a number of people brought up today and how those

two things interact. i lookag forward if i'm confirmd learning more how to think about that issue. >> i appreciate that. on the sgr which was brought up by the chairman and some of the other members the question of our need to finally fix it we have window of opening i had occasion to watch you in action for eight successive weeks at thean white house when our group of eight had dinner with the president and denis mcdonough trying to find a way forward on deficit and debt reduction to talk to reduce obligations over time. i don't want to get into a long question but i would like you to consider leaving all options on the table in terms of fixing the sgr in terms of where we find the money to do so. as you remember in our discussion some structural reforms of medicare in the out years can bring about tremendous savings without hurting beneficiaries. talked about those in those meetings. that could be part of the equation that helps a find a way to pay for the sgr and permanently fix ithu and never e stuck in one year renewals over and over again. i appreciate your leaving all

opportunities on table, not committing yourself to every open student but leaving them all on the table for discussion. >> senator, i welcome the idea of leaving all opportunities on the table and i think as we reflect in our budget we have ar wide, range of opportunities tht range from the type you're talking about to revenue as well. so all on the table. >> thank you very much. thank you, mr. chairman. >> thank you, senator isakson. senator roberts. >> thank you, mr. chairman. miss burwell, when we spoke during your hearing before the senate health committee i asked you questions about the independent payment of advisory board, i be a, that is theym acronym foren it -- ipab. what would have happen to medication rationing if they came to being. you were hopeful, quote, ipab never has to be used and by your time as hhs secretary would never get triggered, with the

outstanding comments about your ability and leadership by senator rockefeller and senator coburn as a follow-up, since you don't believe ipab will have to be activated as with your leadership would you simply support its repeal? >> senator, with regard to ipab, i think it is important to reflect ipab as currently written would not affect beneficiaries. that is very important part of the law with regard to if it is implemented. with regard to the repeal andec that question, i think senator, one of the things that is hopefully a helpful thing is having belts and suspenders in place to help us all get to the place we need to with regard to reducings health care costs. >> i don't know about a belt and suspender. maybe barbed-wire would be a better way to put it. i would echo my colleagues regarding your responsiveness around willingness to work with this committee and all members of i congress. i also like to add relative medicareto stakeholders to that list.s. i just this past week i had the

kansas hospital association at my office sharing their frustrations about the lack of responsiveness from hhs. here is a copy. thats is not their letter, these scratchings are mine but this is the same letter they sent your predecessor in january. haveen yet to receive a response regarding the medicare recovery audit contractors.th we lovingly call in rural america as theed rac. they don't like to be put on the rac the office of medicare hearings and appeals two year moratorium assigning new cases to administrative law judges. still awaitingo a response. i know the racs returned savings to the medicare trust funds. vital that local hospitals medicare providers have timely appeals of these audits. we're talking about 65 administrative law judges and now, 357,000 claims for medicare services which i understand is the reason for the delay, or suspension. it is rather incredible. we have bonn from pending

appeals in just two years of 92,000 claims to 460,000 claims. and thenon the, number of weekly receipts in the central operations division from about 1250 to 15,000 per week. reason is is obvious. and that is the hospitals win 70% of the time. which means these independent contractors comeek into a hospil many times, they have never seen them before. they're being fined for regs they don't know anything about and then, if you're in a small hospital you really have a problem trying to figure out whether you're going to appeal or not.d and nowfo we find that the appes are suspended. so d i would add to my list what can be done to better balance the need to recover a proper payments. we're all for that, while not imposing undue administrative burdens on-- providers, particularly those in our ruralo areas. >> senator, with regard to this issue of the racs as well aspa

balancing of havingrt hospitalsr able toea process things quickl, at the same time, we're trying to prevent abuse of medicare, those are the principles we need tos balance. if is am confirmed this is an issue i think is going to require a quick lack, a fresh look, and think about how we get the balance and what processes can be used to balance the two interests because i think you're appropriately reflecting ino terps ofth speed and processing . i think you are appropriately reflecting -- in terms of the speed and the processing, it is not where we want to be in terms of the system. perspectiveyear's rule, asystems role -- rule that you signed off on at omb, hhs payment clarification requires submitting a patient into a critical access hospital and certified that the patient

must be discharged or transferred within 96 hours. this payment clarification, which is not in line with the critical access hospitals condition for participation with medicare, in my view. and in their view, is crippling the ability of many of these communities to provide rural -- toommunities communities. one doctor said i usually met 12 minutes and now it is three minutes because of the 96 hour role. besthen they decide on the course of action for their care. it is another example, in my opinion, of having to tell cms that if it is not broken, there's no need to fix it. if confirmed, will you do all you can to see if we can reverse this payment issue, so that rural seniors can continue to receive care at their local community academics the issue of critical access hospitals and care in rural communities -- at local communities? >> the issue of crigler access hospitals and care in rural communities is something that we

need to get the right intent on. in terms of how to get to the place where the original objectives of the rules and be achieved in the way that they do not have the unintended consequences that you are articulating. >> thank you. my time has expired. >> senator warner. >> let me thank you again for your service. looks like you're coming around the bend and close to being done. i have a number of things i want to get on the record. first, i want to add my voice to the comments made by senator isaacson and senator roberts. i think the displacement of agents and brokers with a challenge and a mistake and i hope you will review that process. let me also add my voice to what senator roberts said. i hear repeatedly from rural rac audits.bout the e we do need to make sure that we get rid of waste and fraud, but we want to look at that. moving on, one, the treasury

department recently finalized the employer rules dealing with individual mandate. there's a lot of complexity about these rules and some of these complex -- complexities were highlighted by the american bar association. this is not just a treasury-ir wretcs issue. are implementles it, -- i have raised this with you before. i introduced legislation with eight cosponsors that is endorsed by a number of employee and employer groups, which would basically allow employers to respectively rather than have a one-month -- once per month reporting. upfront require an collaboration between hhs and

treasury that might remove one of the administered to burdens that we here in enormous amounts about around aca. my hope is if you are approved, and i hope you will be, that you will help work with us on it of this legislation or other ways we can improve this reporting requirement, and again, with this perspective action rather than just doing it retroactively. >> if i am confirmed, the it ministration and the president has said that we welcome the opportunity to think about things he can do legislatively and otherwise to improve it. >> i will take that as a yes. it is my understanding that there were agreements with the number of web-based entities to allow private exchanges to enroll tax subsidy individuals pursuant to regulations issued by hhs in march, 2012. again, something we talked about. this effort was stymied due to in -- insufficient technology integrations. i understand there have been some small steps taken by hhs,

but not a lot has taken place. to my mind, this should be a no-brainer. if we can get some of the sites, perhaps more user-friendly as an additive to help that, i hope you will work with me and these web-based entities to make sure that there is better technology integration this area. >> i welcome the opportunity to think about the best way to do distribution. and harkening back to senator isaacson's russian and your comment, the dissolution mechanism in terms of how people can easily access and receive health care. >> and clearly, there may have been sites that were private sector sites that had a better reputation than the federal exchange. if we can find ways to utilize that and integrate that technology, to me, it seems like we want to expand that. i hope we can work together on this. again, an issue that i raise you, au -- raised with

little more, kitty, about cms changes recently in the hospice benefit. i think as this is being rolled out, it is confusing and lacing a lot of unnecessary burdens on hospitals, patients, and families and providers. hospice should not reject can shown unless it why should be covered by the part d plan. if it is related to the terminal illness, and her stand. but if you have glaucoma and a terminal illness, glaucoma is not related and the hospital provider should be reimbursed for that. my hope would be that we can dig down to earth relators of difficulty with this issue and that you will work with me --

dig down two or three players of difficulty with this issue and that you will work with me and others on this. >> i look forward to working on that issue, in terms of how we can figure out how to pay for the right things and do things that are implement. >> with four seconds left, as a former governor, to me just say that -- let me just say that one of the things we often try to do as state is to look at innovative programs, to try to get a waiter, whether it is medicaid or chip. but a lot of these programs never move from innovative test models to actually becoming permanent parts of a state program. this, to me, is an area ripe for administrative review. at some point, you have either proving your case and should be accepted as part of the state program, or rejected. again, i hope you will work with me on this. >> i will, senator. >> thank you. chairman, andmr.

this burwell, thank you for your willingness to step forward for what will be a very challenging tax -- task. you will be among folks who have had the worst job in washington. i congratulate you on seeking a promotion. [laughter] but i do think you come at it, therefore with a different perspective than other hhs secretaries have had in modern times, which is that of a budget cutter and someone who has had the possibility for oversight and trying to find efficiencies. i think that is really important right now. i hope you will continue to have that attitude at hhs. , will focus on medicare because i think you would agree with me that when you look at not just the health care issues, but also the fiscal issues, if we don't figure out a way to reform this incredibly important, but unsustainable program, we will have a difficult time today our fiscal

house in order. and as you found out when you were at omb, this is not an easy task. there is obviously a lot of difficulty in touching any aspect of medicare. but the reality is, the trust fund, which is the trust fund covering hospital care and skilled nursing and so on, is expected to be insolvent by 2026, according to the most recent trustees report. even if that were not true, we know that medicare as a program currently offers three dollars in benefits for every one dollar in taxes that a retiree contributes. that is your typical family in cincinnati or in washington, d.c. program already that is heavily subsidized by general revenues. and heading toward this , even with the general revenue contributions. .y question to you is this in this confluence of omb and

hhs that may well come together here with your confirmation, what are your thoughts about it? and let me ask you a very specific one that i think you should be able to answer in the affirmative. in the president's budget in the past couple of years, he has inluded a change in the way which the recipients of part b and part d benefits pay their premiums. he said there ought to be additional premiums for folks -- whoe around $170,000 make a certain amount per month. in retirement. in the president's budget, it was $56 million over a 10 year budget. -- $56 billion over a 10 year budget. that it willicated be over $400 billion in the next 10 years. budget.fast-growing it is what we ought to be

focusing on here in congress and with the administration. my question is, one, i assume you support the president budget proposal. but, two, would you be willing to support it as far as means testing under medicare to be able to deal with -- we talked about sgr. my question is really about deficit reduction to come together to deal with a problem that has been difficult politically for us to handle in the past two years in congress. would you support a proposal as a stand-alone measure? >> senator, i agree with you. i think one of the real benefits of the premium income testing -- income testing for premiums has to do with the fact that it is a structural change and you get those benefits in the out years that are important to the members and the deficit space also when i think about the omb,its and the my role at i think it is important to understand that the driver is the issue of health care costs the medicare system.

but it is also our demographics. and because of that, the magnitude of the problem when one gets to the specifics of what you're going to do to resolve that issue, i think it actually takes a combination of things to do that. i think it takes things as you are discussing, that are on the beneficiary side. it takes things that are on the provider side. it takes things like revenue. >> but as you know, we have already done a lot on the provider side already. my question for you is, in the president's budget, i assume you support the policy. would you be able to support a policy initiative, whether in the context of sgr, deficit reduction, or tax extenders, or whatever it is? do you support the proposal? >> i support the proposal in the context that the president's budget presented it. and as i said before, all things are on the table. >> why does revenue have to be part of the conversation with regards to means testing? >> with regard to means testing, it is strictly via 2 -- the issue of deficit reduction in

the long term. thingse looks at overall, you get to this is specifics. you get to a premium perspective, beneficiary perspective, the perspective of providers. that is where you get to with integration as well. >> a few moments left. you were saying that with regard to means testing on premiums that there have to be tax increases. let me ask you this. when someone pays you a higher premium, aren't they paying the government more? is and that a taxpayer over a certain income paying for a benefit that they would otherwise not have to pay? >> these do affect high income, but what is important is when one is looking are talking about a package, i think it is important to see what it -- what is in the package. what is it you are paying for and what are the offsets that you use. but mr. chairman, please indulge me. you are saying that you insist on raising taxes on wealthier individuals, in order that wealthier and visuals could pay

more to the government. and by the way, the congressional budget office says it is also revenue, which is premium being paid to the government. is that the logic? >> in the president's budget as presented, there are a number of different elements that do everything from corporate tax reform to other things. that is why i actually think it is important to look at a package in its entirety and to understand those ramifications for it, whether it is high-income people or other beneficiaries. >> time is expiring here. let me make the obvious point that it will be very difficult to make the babysit -- baby steps on deficit reduction when people cannot agree about paying more to the government, that it is something that can be done outside of them having to pay more to the government. the logic does not seem to fit for me. i'm hopeful that we can make progress on this issue. i'm hopeful that despite what you said here today, given your background at omb, and that you would be willing to work with us on the steps. >> thank you, senator portman.

senator schumer. >> thank you, director burwell. i'm delighted you are here. were just a fabulous omb director lew and i think you'll make a great secretary. i'm enthusiastically in support and i think you will be passed by a large majority. the only superlatives that i my gooden concede -- friend senator coburn in praising you on this issue. i have two issues of concern. the first is about something called powdered alcohol. recently in april, the treasury department's trade and tax approvedb -- ttb, powdered alcohol. it is not in stores yet. it is just as it sounds. it can be mixed with liquid or

even started. once the amount of powder in each package is resolved, alcohol makers -- powdered alcohol makers indicated they will seek labels for their product to be approved. it is on track to be on shelves in the fall. it is troubling to me. obviously, you can drink a lot more alcohol in powdered form than in liquid form, just because of the volume. you can put it on food. kids can sneak it into dances, concerts, sporting events, in their pockets, in their shoes. is really troubling. the only hope we have of stopping alcohol from getting on the shelves -- and mothers against drunk driving is very concerned with this -- is the fda. and you will oversee the fda. i believe that the fda should get involved. it is our premier consumer agency. and i hope they can investigate

this new substance just as they ,id with four logo -- loco which was alcohol and caffeine makes, and they banned it. that was proven unsafe and i believe this will. all i'm asking is whether you will commit to having the fda look into this new how call product -- alcohol product for health and safety reasons. >> this is a new issue. it is one i would want to understand better and i would want to know which jurisdiction and exactly why. as far as it being a tax issue, understand that, but why it has not been previously looked at by fta. >> they haven't looked at it, and i urge you to do them -- to do so. >> i will look at it further if i'm am confirmed. >> thank you. the other issue of concern is a hydra, where the fda has been worse. we have opioid abuse all over the country in urban and

suburban and rural areas. powerful version of hydrocodone was approved for the market without the same temper tamperproof preventions in place for things like vicodin and oxycontin. the fda approved it even with opposition from many centers. and lawddiction experts enforcement around the country alarmed. there are ways to make it tamperproof and ways to make it you cannot turn it into a powder and stored it or inject it. you know the problems we face in every part of the country with prescription drugs. would you review this decision by the fda when you are in office? >> the issue of ,rescription drug abuse is one being from a world community in southern west virginia, where i have seen his issues firsthand

in terms of how damaging they are to both the health and the economy. an issue i take very seriously. one of the things i want to do when i am confirmed is that i work with the da on science-based decisions. if i am confirmed, this is something i would want to understand how the decision was made. >> thank you. again, i hope you will be actively involved. i understand the necessary caution when sitting at the table. but i know who you are and i think you will get involved. medicare advantage. senator crepeau talked about this. i don't want to get into details. i only have 27 seconds left. there are some measure against rips that are abusive and off the federal government. are on medicare advantage. most of them are very happy. you don't have, i just would urge you to separate the wheat from the chaff. some people on my side of the aisle say the minute they hear medicare advantage they say this is terrible.

it is just not true. not in my experience, in myeo state. they'repl o all across the boar. i just hope that when you look at h medicare advantage you will give it a careful look and not take one broad brush and say programs are all bad because they're not. >> thank you, senator. >> thank you. >> thank you, senator schummer. let's see. next is senator carper and then senatorou toomey. >> thank you, mr. chairman. miss burwell, nice to see you. m congratulations on your nomination. >> thank you. >> one of these deals where i have mixed emotions. chair of the committee has very close relationship with omb, if you're confirmed for this position means we lose you at omb. i was kidding with some much my colleagues. you know, if sylvia is confirmed for secretary of hhs the president will nominateos tom coburn head ofe omb. two of my colleagues said we can't vote to confirm here. i make it clear. that is the not plan. that is not the plan.

the, we love working with you at omb. love working with the team you have put together. one of the things we focused on as you know, how do we get better results for less money. one things being successful in government, academia, business, whatever might be key is leadership, leadership and if one of the reasons why the department of homeland security, which for years was kind of a laughing took when it came to being manager of finances actually last year, wonder of wonders, they actually were auditable, they got a clean audit. after 20 some years, the department of defense still hasn't done that. hhs has done that. in terms of leadership, the key is leadership. reducing improper payments what were they last year, $50 billion in medicare and probably 20 in medicaid. the key is leadership. talk to us about leadership. talk to us about leadership. what you learned. what you brought with you to omb. what you learned there how we

can make further progress at department of homeland security, department of health and human services. i live in homeland security world with coburn. what did you learn in your current job that will enable us to get better results for less money in some of these very expensive programs? we need to save money. >> i think one of the things i've learnedcu is being very specific about what you're trying to achieve in the space, in terms of, very quickly, are the mosts importantbe levers. i think in our conversation today, there have been a number of things where actually there are conflicting interests and i think what's important is as a leader to be able to quickly get to the problem solving in terms of articulating what are those conflicting interests and how do you weigh how you go forward in terms of it won't be imperfect. there will be things in order to make progress we need on medicare fraud, it comes back to issue we were discussing with regard to races and what tools are we using. there will be places where they are not and continuously

thinking where will you focus, what is the core objective and how will you continuously improve. those are the some elements making difference in improper payments which have gone down from 5.3 are to 3.5 for entire federal government which this medicare and medicaid issues large portion. . .this medicare and medicaid ie will be a large portion of that. left acoburn and i secure briefing from the secretary of homeland security. talk about border security. we talked about all the folks going up across the border not --m mexico, but hundreds, honduras, el salvador, guatemala also the reason why as they are bad lives and they will do almost anything to get appear. i said commits not enough for us walls.d stronger

we have to look at the underlying causes, the compelling reasons that make people want to risk life and limb to get appear for a better life. i want to talk about underlying causes with respect to obesity. underlying causes with respect to medication adherence. we know that >> diabetics, all the money that we spend on that sort of thing. and if you look at the medication, if folks are able to afford medicine, comply with medication and how much money we could save. talk to me in terms of helping to get better results for less money with respect to those kinds of things. the pace program where we treat our dual eligibles, folks who are medicare and medicaid eligible. little more expensive at first but save money in the long run. talk about programs like the pace program actually are going to be helpful, can be helpful. >> i think comes down to the fact that prevention is such an

important part of reducing costs. if we can get in front of these things it's actually a similar concept of what we're talking about earlier with regard to instead of m pay and chase, you get in front. things are generally cheaper, better and easier if you get in front of them. some of the things we need to do, we need help make sure where the analytics that show what works in terms of whether it's a obesity and diabetes prevention. i think there are models we need to make sure those analytics are rigorous. the second thing is make sure we're educating and communicating. whether that's in the space of prevention or in space of making sure people understand the rules of the road with regard to medicare. the question of educating and making sure people have the right information. the last thing is about tools. in working on some of these issues with the wal-mart foundation, with regard to how people use healthy eating, you can provide the food so the company on the countryside, reduce costs of fruits and vegetables. the goal was taking those costs out.

even with the communities and populations it actually took educational programs to teach people. when you're shopping and you're a mother or father in the grocery store for a very short period of time need to get home, fix that neil. in terms of serving and using things you've never used before there's an educational component and/or you can use the tools. share our strength is an organization that did it. working to all the elements of the proof, education and the tools are all three elements i think are necessary to make the progress we need. >> thanks for your service so far. good luck. godspeed. >> senator toomey. >> thank you, mr. chairman. director burrell, thank you for being here and a very open and cooperative discussions that we've had leading up to the. i had a couple of questions for you. first is about also mistook we talked about it all of it in my office.

it's estimated over 5 million americans have been diagnosed with alzheimer's. mindset is 11% of all americans over the age of 65, something like one-third, 33% of all americans over the age of 85 have alzheimer's. it seems if you live long enough chances are very, very high you're going to get alzheimer's. it's 100% fail. we have no cure. we have no meaningful treatment really even. and yet in fiscal year 2013 only 1.7% of the nih budget went to alzheimer's research. does that strike you as proportionate to the challenges that alzheimer's presents a? >> with regard to the budget and alzheimer's, our overall plan, there were increases but i think you know on the discretionary side for anything to get increases in the current budget and fiber was a very difficult things it is a talking with any allegation that goes to nih, the $30 billion of that they did,

they then control was that goes. that doesn't get appropriated by congress specifically. does 1.7% sound about right. >> the question of what is the right percentage is something if i am confirmed i would want to spend time with francis collins on how they think about distribution but it's one of the issues you and i discussed and they did follow up to try to find out exactly how it is done but a lot of it is done based on history. when one does something based on history and there's changes, one may need to re-examine. >> i hope you will revisit that because history has changed, alzheimer's has become ever more serious and grave a threat. i want to follow up a briefing on senator portman's discussion because i have to say i do find it troubling at least what i understood you to be saying, which the idea seems to be, republicans and the president's budget have both, broadly, felt

it's appropriate to ask very wealthy americans to pay more for the medicare benefits that get. it's disconcerting to you that the price for getting an agreement to ask wealthy americans to pay more for the medicare is to raise taxes on wealthy americans. it's going to be hard to reach agreement if something as common sense is asking wealthy americans to pay more for the medicare has to come at the price of in addition raising taxes. >> i think when one thinks about it and what i talked about an entire package is some of the revenue raisers and things in the president's budget are not likely. there are elements on the revenue side that are actually in the camp plan. in terms of what has been proposed on the health side would've been proposed by republicans. there is overlap. that's why i think what is important in most all of the issues we're talking about today was on health care side or the deficit side is to look at the specifics, to actually put together pieces and plants.

when we all try to take a piece out that becomes difficult and if we can look at it in its entirety i think we can make progress. >> i'm in favor of a broad, comprehensive reform but if that remains elusive as it has been, a simple idea of asking the wealthiest americans to pay more for the benefit they get strikes me as a very reasonable thing in and of itself and i would hope we don't have to raise taxes on people to get there. i want to follow up on a separate issue which we discussed. that is the budget to reclassification of the risk card or payment. my understanding is that the payments that will go to insurers or come from insurers now that the federal government is in partnership financially with the health insurance, that has gone from what would've been its own account to a see a message on program management account. my interest is just to ensure that we will have transparency in the account. and i'm hoping you can commit

for whatever reason that was done at least on an annual basis we will be able to know how much money came from insurers or goes to insurers through this account, what the source was, whether it's a surplus or whether it is an expense. >> senator, as you and i had a chance to discuss because this is under come part of a larger will making at omb, part of 12866 which as i can discuss specifics. in general terms what i would like to say is senator, this is an want to work with you on with regard to the question of transparency. i hear what it is about which is on the numbers of what comes in and what goes out. i think that's a fundamental question you're asking and one i would look forward to working with you on having been at omb and worked on budgets and accounts i think that's something i would like to work. >> is there a rule that -- forbid you from making commitment to having transparency in this account? >> with regard to the commitment to transparency that's something i think we talked about

throughout this hearing, which is transparency and accuracy are the two things i wanted in a timely fashion. this committee has my commitment on that. >> thank you, mr. chairman. >> staying in the state of pennsylvania, senator casey. >> thanks very much. director, i know we're getting to the end, so rounding whatever the baseball analogy is for getting close to home plate. we are grateful for your patience, grateful for your testimony, the willingness to serve again. and very difficult public service, so we are grateful for the. i know it chance to discuss some children's health insurance issues in health, education, labor and pensions committee. i was noting, we don't have a lot of time for questions beyond me be the two that i have, but just some of the numbers in pennsylvania, enrollment have been significant. i know we've all heard the national numbers, 8 million

enrolled, almost 5 million in the medicated children's health insurance area. i know that senator rockefeller has done so much work on both programs for so many years. in pennsylvania, the numbers, the marketplace plan selection of little more than 318,000, medicaid chip enrollment almost 41,000, little shy of that. almost 360,000 people. some numbers. i'll move from aca to at least two children's issues. one is titled 40, waivers, regarding child welfare. we have in our state as many states to do counties taking advantage of that waiver. where they are working to make sure they're trying to invest in evidence-based programs and incentives to reduce the launch of what might be called group homes in pennsylvania and try to

get them into better settings. but also to make sure that as we do that we are using the evidence-based strategies. we've got five counties in our state, five out of 67 that have used that waiver. two big ones, allegheny and philadelphia among the five. but i would ask you to work with us on i guess two aspects are working for comprehensive reform of child welfare, number one. and also as we do that to help all children in that system. and secondly, to promote as this again better outcomes and evidence-based practices. just ask for your commitment to work with us on that and anything you would like to say about it. >> i would like to work with you on that, i and these issues are issues that i think of her important. even in my current role at omb in terms of this evidence-based

and these issues one of the things that i was are interested in an highly supportive of was the psychotropic drug provision that is part of the president's budget. and analytically based when the using the numbers the administration has which are 17% of all children in the system are on psychotropic drugs up to 34% in terms of some of the other studies using data to understand what things are going right or things can be improved so i would look for to working with you across the range of issues for children. >> i appreciate that. secondly, and finally, one of the areas of policy which public doesn't get a lot of national attention but issuing some promise isn't the so-called ccm i -- is the so-called see cmi, i know a lot of the innovation is focused on medicare and a properly so. what i hope to is that through both medicaid and chip come

through both of those programs and within the rubric of ccmi that we can have enough testing of new models so that we can get some of the benefits of that innovation for children in addition to what the results for medicare, and ask for your help on that. >> yes. i think we do want to get the benefits for both systems, both systems are important and we have examples in our own budget, the president's budget where we are taking things that are working in medicaid and trying to have those shift to medicare in terms of things that are working, in terms of effective health care in terms of cost effective. >> i know i'm out of time but i wanted to just make one final point. we know that anyone who has anything to do with child advocacy over many years would tell us that children are not small adults so many specialist

strategies and approaches for kids that may be different than how we treat or cure for adults, but we are grateful for your commitment. >> thank you. my six and a half and four and a half year old prove that everyday. >> thank you. >> very good. senator cantwell. >> thank you, mr. chairman. director burwell, thank you very much for your willingness to serve and thank you for your time in the pacific northwest. 10 years at the head of the bill and melinda gates foundation for global development and then on the board of the university of washington medical center. i'm sure that i'm on the board will come in very helpful in this post. i wanted to ask you about two things as relates to the affordable care act and priorities and see how you plan to manage them. one, section 3007, i don't expect you to know that section but knowing sylvia burwell, she might know that section. but we are talking about the payment formula by adding

quality cost ratio that will reward providers for low-cost quality and penalize providers that don't. and essentially move the nation out of our current model to an outcome based model. we have some discussion -- this is part of the application i think the secretary was required to start a process of this year or the beginning of the formulation of the regulation this year and probably had to be published next year. then the sgr bill that we were recently looking at having provision that reforms that. what steps of do you plan to take on implementing that valued based payment system? are you for was in the sgr bill or are you planning on just proceed with the rule? do you think that's a better process? tell me your philosophy on the implementation of this provision. >> with regard to the specifics of implementation that are truly at hhs, that's something if confirmed i want to look at.

with regard to philosophy, the question of how we're going to be able to articulate quality and connect payment to quality will be a very important part of transitioning the entire system. that's transitioning the system in terms of government and how we pay but also the private sector. i think what we will have to do is work from the perspective of the government side. it is a complex thing in terms of future hip surgery the quality of your hip surgery because the surgeon did the front surgery versus the back of? is at the anesthesiologist? how do we determine those things? we need to work to get measures in place and start making progress. i think we can turn to the private sector because in some cases -- >> that's my point. specific -- pacific northwest has shown great results. now the debate in washington seems to be can we overturn the affordable care act or ignore this, or let's put a provision in. let's put a provision in the gets the rest of the country start doing this but in a very

slow, incremental way. or do we go with the results that we know all across the country that are working and get implement it and push people to implement it in a more rapid fashion given what we're looking at from a population bubble and retirement and everything else. we need to make these reforms. i hope you understand, you are going to hear a lot from me and from people from the pacific northwest. we don't want to go slow. we want to go faster. we don't want to see proposals that some of my colleagues are proposing a social security or medicare to privatize them instead of doing these important outcome based better performance reforms. and i will note even in the affordable care act there were a lot of states that took us up on rebalancing from nursing home care to community-based care, saving lots of money. these are states and governors is that they didn't like the act and other implementing one of the biggest cost savings there are. i hope we will run faster on

the. the second issue is on the implementation of the basic health plan which was an option in the legislation to afford those people who earn too much because, to qualify for medicaid coverage but the private coverage struggled to make marketplace premiums and this is something that we gave states an option on so i want to know what you will do -- the department was late in getting those rules developed. they finally came out in september. they were supposed to be done previously somewhat to know what you will do to make sure that states could choose that will be fully operational by january 1, 2015. >> senator, if i'm confirmed one of the things i wanted it is quickly find out in terms of the sequencing of all the things that need to get done and information that states need to have, as well as the technology we need to get in place to make sure that the next years run smoother to do something as soon as if i am confirmed that would

be one of the first things to do is understand who needs which information wind and how we're going -- >> do you have, if you don't know enough about right now you don't need to discuss it that i didn't answer from you whether you support the basic health plan as an option for states as written in the statute. the agency has ignored a long time that program. finally, got it together, and yet it's put states giunta want to get a firm answer for me so you can do that for the record or -- >> be happy to. >> just the last thing, i guess i'm 16 seconds over, but maybe i could have all that extra time. >> you can't. >> i don't know, mr. chairman, if anyone brought up graduate medical education and paying for graduate medical education so i don't know what, where you -- what role you think the agency's going to play in helping identify the need for filling

that gap of primary care physicians that we need to obviously we are not going to get there if we don't have a graduate medical education expansion. so i think the president's current proposal in the budget does some of that expansion. in terms of making sure that we do two things, that we increase our providers that we target that helped to primary care and worry of shortages in specialties, that those two places. in addition expanding the national health service corps is another means by which we hope to improve and push out getting more providers out in a few. the other thing is some of the proposals in the budget also expand what certain government programs can benefit in terms of not just the physicians themselves but also other, physician assistants and nurses in terms of the primary care needs we need. it's a place where think we have to focus and use all the tools but the other thing we have to do is make sure the money is going against what one is trying to do when one is doing gme. and focus it on the kinds of

issues which is why the proposal is focused man on primary care in terms of the new gme. >> we think it's a good start but hopefully we'll have a discussion about how big the need is as it relates implementing a medical home for people and why we need to focus on moving forward on graduate medical education, but thank you and thank you for your willingness to serve. >> thank you. just a couple of additional matters and we're going to liberate you, director burwell. this is her second nomination hearing in less than a week and we appreciate your answers today. we have focused for the most part on the agency's very extensive health care proposal and that's why i got it was very good that senator casey began to touch on the human services aspect of the agency's work, and particularly programs like foster care, temporary assistance for needy families. you all have a very extensive workload there.

can you give us some sense of which are priorities would be on the human services side of your budget? >> scented to come with regard to setting priorities in those areas one of the things in a number of my conversations with the members of this committee and the health committee, they have articulated some of those priorities. i would want to as we discuss also hear from the stakeholders and from the department themselves before setting exactly what those priorities are. they are broad and they are numerous and include everything from an issue that's in the news today which biosecurity in terms of the murders issue -- mers issue. the administration for community living i think touches on some of the issues that we talked about today with regard to the hospice and how we think about care for people and communities, how often the key people there. is about cost effective and better in terms of quality? i think the range of those issues is something i want to hear about and quickly set

priorities. >> by way of wrapping up just a couple of comments. first on the medicare advantage issue, i think you know that the pacific northwest has some of the highest rates of utilization of medicare advantage, good medicare advantage, has been at it for decades in my hometown and senator cantwell's hometown, and, obviously, we heard senators on both sides of the aisle touch on it. i just want to walk through what i heard. i thought it was very constructive. you made the point that the premiums are down, the coverage is up, and a number of the questionable operators have been squeezed out. i think that is very good because i remember some of the tremendous abuses we saw in the early days of medicare advantage. we had oversight hearings on it in this committee. it was just really gross, some of those practices, and that's been really driven out of the field. in response to the center's questions, crapo, others, you

essentially said anything this is where the senators were going, that we ought to proceed carefully. and to get the latest data and work through these various issues to essentially continue on track. that's what i heard the senators say and i think that's a you addressed it and i think that's very welcomed and very constructive. the last point i want to mention is reflection on the last two and half hours and watching you also in the other committee that held a hearing on your confirmation. we've been at it for something like two and a half hours, or thereabouts, and from the beginning where you had this extraordinary bipartisan sendoff from dr. coburn and chairman rockefeller, who i would note has not budged for the last two and half hours. you are an ultimate loyalist i think would be fair to say. what you have done is, in my

view, tried to respond to important questions, landmark law and big health care challenges come in the way that out to bring people together. that's why i reference the point with respect to part d, because a lot of the stories in the early days about the aca resembled the early stories about part d. and part d we now know has come in at 30% plus in terms of cost reduction beyond what cbo projected and the satisfaction among seniors has been enormous. senators, no matter how they voted on part d, came together and said we're going to try to make this work. were going to try to do that on this committee, and i think you can be a very powerful agent, once you are confirmed, we'll do everything we can to make that possible quickly. you can be a very powerful agent in terms of trying to bring people together, and to get us to that point that you touched

on post the enactment of part d of trying to bring people together regardless of how they voted. so that's my take away from the last two and a half hours, that you can be that kind of member of the cabinet to will help us cut through some of the polarization we've seen over the past few months, and they think that would be an extraordinary service to the country. senator rockefeller, is to anything you would like to add? >> only that in a senate is so full of toxicity and partisanship, i think if it was to have ours, it was two and half hours, i think you are sort of attitude, you're listening, your energy, your knowledge, your ability to defer things

which you haven't yet done because you're still into another job, but you were anxious to get at those problems is what innocents with the chairman is saying, and that is how do you begin to take down the walls on a subject so enormously important as the doing of health care, such an enormous piece of legislation, such a vast implications for the country. and i think it's very interesting just in your performance this afternoon thatt also obviously interposition that i'm sure you're going to have, -- in your position -- did you going to fit comfortably. >> thank you, senator. thank you. >> transport let me close by thanking my colleagues on the other side of the aisle led by senator hatch. they have been very helpful in terms of allowing us to move forward. they have indicated that members could have until 6 p.m. on

thursday to submit questions for the record. so clearly we're moving ahead, and it's my intent to work very closely with senator hatch and all committee members to report your nomination probably after the answers to the questions i received. we thank you for your patience, and with that the finance committee is adjourned. [inaudible conversations] [inaudible conversations]

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[inaudible conversations] >> several members of congress acting in good faith have put forward plans that address our long term funding issue and we applaud them for their efforts and i know there will be more discussion in town this week on those attempts. others are suggesting the political reality is we will have to settle for an infusion

of cash into the highway trust fund as a stopgap measure. where are you going to get the cash? used to be there were ways to do it. i think it is a little tighter now than it was. it may be true so we can get an infusion but it is hardly the long-term solution that we need if we want to maintain a world-class infrastructure system. this is like the movie, groundhog day. every few years we wake up and have the same conversation about funding the same fights over the gas tax and the same scramble for money. the only problem in recent years, we haven't been doing very well. you do know, round number is 20 years since we increased the gas tax. don't get me wrong, money is important, you can't make it if you don't have the cash, but don't for a minute think that is all we have to do to get the

infrastructure issues working if you look everything being discussed in recent days and weeks around the environmental issues, many of those are somewhat in conflict not because they are wrong but what we're trying to do, where we are trying to spend our money. what everybody would agree to is we need a comprehensive forward-looking program that meets the needs of the competitive 21st century that embraces innovative approaches and turns the support of the jaded citizenry. >> this weekend on c-span a look at america's aging infrastructure and possible effect on the economy saturday morning at 10:00 eastern and on booktv at the gaithersburg book festival with live coverage throughout the day starting saturday morning at 10:30 and at 10:00 p.m. former justice john paul stevens on suggestions to improve the constitution on c-span2.

american history tv "national review" editor richard lowry on the fourteenth president's work ethic and political ambition in lincoln announced sunday night at 8:00 on c-span3. >> c-span's newest book sundays at 8:00, collection of interviews with the nation's best storytellers including david mccullough. >> we're sitting here in this city designed by frenchman. the french engineer and architect. the great symbolic sculpture, the gateway to the country in new york, statue of liberty, a gift from france, french sculptor bartholdi, countless rivers and towns and universities all over the country with french names. we don't pronoun's it away they do but the influence of france

in this country is greater than most americans appreciate. >> read the interview with david mccullough and other noted storyteller's with 25 years of the book notes and q&a sessions published by public affairs books and now available at your favorite book seller. >> live this morning at the brookings institution in washington looking at ways to modernize the nation's aging infrastructure including freight movement and drinking and waste-water treatment, economic development and transportation officials from salt lake city along with congressman john delaney with the joint economic committee. the brookings institution is the host of this event running a little behind, it was supposed to start at 9:30, 8 gets under way live on c-span2 in ten minutes or so.

[inaudible conversations] >> a quick reminder of others live coverage on the c-span networks, later today at 12:3 the congressional internet, this advisory committee will meet to discuss the fcc and the internet, yesterday the fcc voted in favor of a proposal allowing internet service providers to charge websites for faster video streaming. we have that live again starting at 12:30 eastern. the secretary of state hillary clinton is said to speak at 11:30 at the new america foundation conference. c-span will have that live at 11:30 eastern.

[inaudible conversations] [inaudible conversations] [inaudible conversations] >> waiting for the start of this brookings institution hosted discussion and the nation's infrastructure should started moment. yesterday veterans affairs secretary erich sinn secchi appeared before the senate affairs committee testified

about ongoing challenges facing military veterans and this in light of recent investigation that included 40 people may have died as a result of substandard care at hospitals. bernie sanders chairs the committee. we will hear remarks from him first followed by kansas city jim moran. >> very serious allegations have been made about the a personnel in phoenix and other locations. i take these allegations seriously as i know every member of this committee does, which is why i have supported an independent investigation by the v.a. inspector general. as we speak right now the inspector general's office is in phoenix doing a sold examination of the allegations and my hope is their report to us will be done as soon as possible and what i have stated and repeat

right now is as soon as that report is done, this committee will hold hearings to see what we learn from that report and how we go forward as soon as we can after the investigation is completed. i think there is a member of this committee disagrees, no member of the united states, that this country has a moral obligation to provide the best quality care possible to those who put their lives on the line to defend this nation. i believe every member of this committee will do everything we can to get to the truth of these allegations. if we are going to do our jobs in a proper and responsible way we need to get the facts and not rush to judgment. one of my concerns is there has

been a rush to judgment. what happened in phoenix? the truth is we don't know. we are going to find out. >> thank you for conducting this hearing. >> i arrive the few minutes late because i returned from world war ii memorial, had conversations with campus veterans, a moving experience each and every time to have the opportunity to visit with world war ii veterans and again the conversation was the va is failing them, please make certain that doesn't continue. thousands of veterans across the country but hundred in kansas visit with me on an ongoing basis and tell me they're struggling and suffering stories because of circumstances they find at the department of veterans affairs. they would tell me that the sacrifices they encounter if they were willing to sell less

and humble service why can't we have the service we earn and deserve. and the department of veterans affairs is not providing those where the veteran's what orthy committed to do. they lost hope and don't believe things will get better. your announcement of a face-to-face review. >> we will go back live to brookings institution for discussion on the nation's infrastructure. >> thank you to the foundations and corporations that really made our work possible. ford foundation, aig, ge, rbc and all the members of our metropolitan leadership council, they made our research possible. the timing of this we could not be better and i know congressman

john delaney is going to talk about this. there are clearly short-term federal actions involving the gas tax and highway trust fund that are critical and a new way of national government in gauging but there are other issues that are informing this week. does the united states have what it takes to build and retrofitted new generation of infrastructure for today's disruptive challenges? this is a pivotal decade because of super sized economic social environmental challenges but we need more jobs. we still need 7.1 jobs to make up the jobs we lost during the downturn, labor, dynamics and population growth. we need better jobs because we run from 81 million people living in poverty and near poverty in this country to 27 million. and we need to build communities

that are resilient and sustainable in the face of economic restructuring and environmental challenges. so infrastructure can play an enormous role in addressing these challenges with a national scale and the city and metropolitan scale which drive most of the economy if we think differently and in of a continuously. what we tried to do at brookings and this is a setup for this forum and congressman john delaney, we try to do four things, we try to redefine infrastructure for a new era. we defined its essentials as 7 sectors of infrastructures that really have all their own methods how we design them, finance them, delivers them and govern them from roads and transit can logistics' to energy and water, modern sophisticated economy, infrastructure means a variety of things, and we need

to understand that, basically not just come up with ideas but actually execute them. and redefine the impact of infrastructure. this is 14.2 million jobs in this country, 11% of our jobs, the incredible thing about the infrastructure supersector is these are good jobs. there are many wagers in their other sectors of the economy so you when you invest in infrastructure the platform for broader growth, the dog in the supersector, and redefine what we mean, innovation and infrastructure, you cannot build 20th century infrastructure 421st century economy. and potential for technology, deploy it in ways for better results and finally this will

get congressman john delaney's thoughts we are trying to redesign how we invest in infrastructure. we need to invest for the future and frankly the entire system is a public/private exercise in the united states and did is federalists in design and execution. we are not a country like many of our competitors that have a central government that basically has a national plan and does the bulk of the investment. we are a federal republic and we are public/private enterprise. as we go forward today we have some excellent innovators from around the country. and hard work of putting forward a vision for how infrastructure looks like. we've really need to think differently about this. and a line to how we operate as

a nation. i would like to introduce the most innovative members of congress, john delaney, congressman from maryland igad district, home town, washington d.c.. someone who comes into the national government from the private sector, from a company listed on the stock exchange. and ideas that can be deployed for again of very different kind of moment where the national government needs to be. all platform for foundation in the time of the infrastructure moving forward. so on the critical committees that deal with what we are going to talk about today, thank you for coming here, looking forward

to your remarks. [applause] >> thank you for the nice introduction and all the work you do. i want to thank everyone for being here and your significant station in infrastructure week. it is the topic near and dear to my heart and i want to thank brookings for hosting this and for all your contributions to this topic and contributions to public policy which in many ways is singular. it is great to be here and be part of the brookings event. in my judgment increasing infrastructure investment in the united states should be our first domestic priority by any measure and i say this for three reasons. the first reason is things that bruce touched on which is it is an incredibly important jobs program to some extent and in

particular focuses on middle skilled jobs which is exactly what this country needs. if you look at the data around job creation in this country we are doing a good job creating high skilled jobs and doing very good job creating low-skilled jobs. high skilled jobs create low-skilled jobs. what we are lacking in middle skilled jobs, the kind of jobs where people can have one job and a decent dinner to living and raise their family, that is where the shortage is, that is the part of the market that has been hollowed out by macro trends of globalization and technology infrastructure is a perfect way, investing in infrastructure is a perfect way to create those jobs because it creates them directly through the people who build the infrastructure and in directly around all the manufacturing those with infrastructure because our ability to compete in manufacturing, the kind of things you manufacture for infrastructure to simplify it i

began heavy in the united states has a competitive advantage building big and heavy things so will be stimulated to manufacturers sold for the first reason to invest in infrastructure is it creates jobs and i think the point really needs to be emphasized because i come from the financial-services industry and people often ask me what do i think the chances are of a non-financial crisis in the near term? i think the chances of another financial crisis in the midterm are almost zero but when people ask about another jobs crisis, the effect of globalization and technology continue to accelerate and hollow out the middle class of this country at a rapid rate, much more rapid rate than we anticipate, i put the chances pretty high so to think that we don't need a potentially big problem is very shortsighted. the second thing is it makes it

competitive. and in the world we are living in, and having world-class infrastructure was critically important as you know it creates jobs, makes us more competitive in the long term and also pencils out, and we get almost $2 of economic return, $1.92 to be precise. it is rare from the domestic public policy perspective that you can do things and do all three of those things create jobs in the short-term, make more competitive in the long term and pencil out which is why this should be the top priority and everyone knows about the challenges we face in infrastructure but also a huge opportunity. the numbers are very significant, 3 trillion, 4 trillion and some even say $5 trillion of investment we need in this country to bring our infrastructure to a world-class level. to handle investment of that size we need to at some extent deconstructs how we create

infrastructure in this country and make sure we have good public policy initiatives around all of them. the way we create infrastructure in this country falls into one of four categories. the way we create infrastructure is by having the government grant money to do it. the federal money, provide grants, a variety of grants, most of that infrastructure is related to the common good. that is the first way we build infrastructure. the second way is by charging user fees. a whole variety of projects as we all know. end user fees and area to pay for the infrastructure. the third way is the private sector does it through good public/private partnerships where the private sector is building infrastructure, operating infrastructure and it is being used by the public. the fourth way we create infrastructure is finance it.

someone borrows money, particularly the government pays it back long-term. three $45 trillion debt and the infrastructure investment, we need to be doing things in all four buckets. some people say that is a good idea but doesn't do this. that is the wrong answer. we need natural tools in the tool kit. if we want to have a meaningful improvement in the infrastructure in this country and make a significant investment we have to do it in a lot of ways because it is a complicated and sophisticated landscape. that is the other thing i tell people, have an open mind, all the schools -- all the tools are virtuous because we have such a big need. the main piece of legislation i have been working on in the last year around this challenge is the financing category. we grant money, charge user fees, public/partnerships and

finance it. what we create for lack of a better term is the category killer and financing. the big 800 pound gorilla that will take care of the financing needs the country has in the long term and that is what we created with a partnership to build america act which was a bill i introduced in the house of representatives a year ago. i had a companion bill introduced in the senate a few months ago. right now of this bill is the most significant piece of bipartisan legislation in the whole of the congress. we have 31 house republicans on the bill and 31 house democrats and half a dozen senate republicans and half a dozen senate democrats so it is completely bipartisan and in a meaningful way we are deeply penetrating the congress and adding members every week. what the bill does is complicated the way it lays out, we launch a large-scale infrastructure financing entity

called the american infrastructure fund, which is designed to be a large scale bank bond guarantor to reach state and local governments around the country to finance any infrastructure. and the food groups of infrastructure, this entity allows state and local governments to use this money for transportation, water, energy, communications, education, to think in the world we are going to live in in the next 20 or 30 years we don't think of education facilities as core infrastructure to competitive united states is crazy so all of those categories are eligible for financing. the american infrastructure fund is capitalized with $50 billion that goes in day one and creates the capital bed with this financing entity, and stays in there for 15 years. we believe the american infrastructure fund can leverage

itself 10-15 to one in the private markets. it takes $50 billion of capital and leverageds up to $750 billion and will exist behind the years and will evolve for 50 years potentially financing $2 trillion of infrastructure over 50 years and if you do the math that will create 3 million jobs in this country which is more jobs that exist in my home state of maryland. that is what the american infrastructure fund does. the way it was capitalized was unique. the government does not put $50 billion into the entity. was put in by private companies to buy bonds. very cheap, not government guaranteed, long-term bonds. they would never make this investment in a normal free-market system to create an incentive for them to do this, we say for every dollar a u.s.

corporation invests in the infrastructure fund, they get their right to repatriate a certain amount of overseas earnings to the united states tax free. it has come to sharp focus that we have an international tax law problem and it is causing almost half of u.s. cash to fit over cease, it is growing at a faster rate so pretty soon u.s. companies want more cash overseas, and not bringing it back because we have a system that is unique that would require companies to take tax locally, and they bring it back to the united states they have to pay u.s. taxes effectively a double tax scheme that we have. no other country has this. other countries you pay your tax locally and when you bring your money back to the homeland, you don't have to pay any tax. caches accumulating overseas which is why pfizer is doing

these tax inversions. the real driver of this tax in version is $50 billion of cash overseas. if they bring it back to the united states they pay $20 billion in federal taxes so they might as well use it to overpay for a company that allows them to read the silo overseas. we are creating a path for some of the money to come back to the united states tax free but it is not a free lunch. they have to put some money in this american infrastructure fund. you want to bring it tax free and that are only worth $0.20 on the dollar. they get to bring back money, the effective tax rate is 10% to 12%. the good news is without a penny of government spending, a massive infrastructure financing vehicle that will be around for 50 years and will make a material difference against this challenge and opportunity we have around infrastructure and the reason this bill is so bipartisan is it brings together two public policies that each

party has been sought on right about. we democrats, i am a democrat, we have been advocating increased investment in infrastructure in this country for a long time for all the reasons we talked about. we have been right about that. my republican colleagues have been pointing out for some time so we need to fix this international tax system. that it is a problem, making us not competitive, reducing investment in the united states among our largest companies and they have been right about that and so this bill fuses together those two pieces of public policy and as our result has gone with such significant bipartisan support. the most significant piece of bipartisan legislation and it is a big idea, an innovative idea and is being done in a completely bipartisan way. we won't even at members that keep that bipartisan down the field.

we have a hundred members on each side of the aisle with this bill and recently in light of the highway trust fund situation, how the momentum on the bill might be used to potentially do something even bigger. we thought about how to take this groundswell of support and introduce it into discussions of the highway trust fund because as most of you know we in congress need forcing functions to do things and the highway trust fund which is obviously a disaster in the making, pending insolvency if you will could also be a huge opportunity if position right. and bipartisan support on increasing investment infrastructure, and fixing international tax system and not only departed to build america act but let's do something bigger and deal with the highway trust fund.

what we proposed with our bill, we are raising $50 billion capital from corporations and allowing them to bring back $200 billion from overseas because the ratio is 4 i can 1 for every dollar of bonds they buy any american infrastructure fund they did bring back $4 from overseas so we'll bring back $200 billion from overseas. there's a lot more money over there. let's bring back all of that money, put in place a mechanism for more of that money to come back and take additional revenue that can be generated off of that and use it to capitalize or refund the highway trust fund for several years to get insolvency off the table which will give us time to figure out how to fix it in the long term because in truth the highway trust fund should be funded with a those source of funds using kind of capital, putting it in and funding it is optimal but in

crisis mode, we all know long-term fixes at the highway trust fund are public. how do we deal with gas tax and vehicle miles and the country is becoming increasingly urbanized and a lot of urban dwellers don't drive but they use the roads for goods and services. how do we deal with that? it is complicated. last night i lay out in the washington post and idea that has got a lot of momentum ever since we started talking about it. ..