c-span c-span.org and of course on c-span radio. >> spoke recently at georgetown university for system wide quality improvements in health care, .. conway spoke about an hour. ♪ [inaudible conversations] >> hello, everyone. oh, my god, that worked so well. it never really works that well in the classes i have found. i have the pleasure to serve as interim dean and i wanted to thank everybody for your

participation today. we have a wonderful group from georgetown university medical center, medstar, as well as from the university at large. so we are really delighted to have the opportunity to welcome each and every one of you and particularly pleased to welcome dr. patrick conway. i thought before professor introducing dr. conway i wanted to publicly thank the generosity of the mcculley family who has underwritten the schools to offer this kind of extraordinary gift of leaders and health care to address your university and school's community. some of our past lectures mike from human services, academy dr. diana mason, american

college of healthcare executives and now dr. patrick conway is added to the list. so we are really just delighted to have you with us. those of us who are involved in prepareing health professionals to the future, health leaders are particularly interested in your topic around health system transformation and medstar as well are equally interested in perspective on these issues. before i turn the podium over to professor to introduce dr. conway, i want to do a special enormous thank you to our wonderful program coordinator rebecca warren who we all work, who has done a magnificent job in setting all of this up -- [applause]

>> thank you. senior director of communications and strategic initiatives and finally, of course, professor who is the interim chair. thank you all, it's a pleasure to see you here. [applause] >> hi, good afternoon, as professor cloone mentioned, i am the interim chair of the department of health systems administration. one second. i lost my notes. okay, so we are very pleased to have you join us today for the mcauley lecture. the department of health system's administration officers undergraduate program and healthcare management policy as well as residential and executive online masters program

in health administration. community of health systems leaders that. >> students are exposed to throughout the yearings of their study. dr. conway is a shining example of the kind of national health system's leader that many have opportunity to be exposed to and to work with. he is the centers for medicaid services administrator, he leads for medicare and medicaid innovation until very recently led the center for clinical standards and quality. ccsq was responsible for all quality measures for cms for value-base purchasing programs and quality improving program in all 50 states, was also responsible for healthcare provider certifications across

the nation and for all medicare coverage decisions for treatments and services. the cms innovation center test new payment and service delivery models, accountable care, bundle payments, medical homes, and much, much more. dr. conway has served as the chief medical officer for the department of health and human services, i believe he's the longest -- longest-serving chief medical officer and coordinating council on comparative effectiveness research. white house fellow and a management consultant for mckenzie and company. medical training at the baylor college of medicine. clearly the lecture today is greatest of accomplishments. [laughter] >> but before we begin, i did want to share a really quick

personal memory. when i arrived here as a medical students some 25 years ago, i had the opportunity to attend a lecture very much like this that was given by gentleman john isenburg. dr. isenberg was the chair of the department of internal medicine, georgetown's chief physician. he was also on the national stage as chair of the physician payment review commission which later merged to become medpack, which was renamed to hrq. and he too spoke very specifically about health system transformation and innovation. and he spoke about the clinton health reform efforts which were ongoing at the time about ideas about medicare payment reforms and a variety of such topics. now, as a young medical student i had come to georgetown to

train as a physician and i was struck about how dr. isenberg spoke about grand missions and big ideas and issues that were affecting the entire healthcare delivery system and communities throughout our country. and these ideas were really new and foreign to me at the time. i had just come off of my very first tour, initial tour in the army and healthcare reform, healthcare systems transformation were not the topics of discussion in ranger school, airborne school or out in field exercises, but at that moment in time when dr. isenberg spoke about the big-grand ideas, it was a moment when i was permy move -- personally moved. perhaps it's a mission that applies to all universities, but it includes the missions of formation, scholarship and the

public common good. my exposure to dr. isenburg's ideas played a part in my formation process. it transformed me personally, expanded my, you know, horizons of significance that helped change my professional path, it helped me to have -- discover my own genuine self-and to borrow words, help engage in the ungovernable play of inquiring mind. and that inspirational moment, my hope is that dr. conway's discussion has impact on you, specially some of the young students and young health systems leader and today's lecture helps to spur not only system transformation but participation a professional transformation as well. please join me in welcoming dr.

dr. conway. [applause] >> thanks for that kind introduction. it really means a lot. i will move around a little bit. that's the nervous energy in me. i will say being -- being in the say paragraph as john isenburg is humbling. i will warn you in advance, there are probably too many words and you don't need to memorize all the details on them. a couple of context points, one, very early on i had been at cms five years and counting now, you know, my assistant asked me, why do you go to these meetings at academic centers and the story about john is even more telling is, you know, from my own career mentorship and teaching in academic centers have played a

huge role and i wouldn't be here today if it wasn't for some of those mentors and so i don't know that i'll have the same effect as john isenberg, but hopefully i will say something today that will make you think about the career path and health system. i know we have people from faculty to staff, et cetera,ly try to hit on things from all levels. i will try not to use acronyms, a couple of other context points. i had been at cms as mentioned five years, i am the longest serving chief medical officer in cms's history. i was in our retreat, senate directors and myself and andy and i remember five years ago we had the retreat and i looked around the room and i said, none of you remember that, none of you were here. so a significant amount of

turnover at cms. cms is an entity, largest insurer on the world. 140 million americans right now. we have 6,000 federal employees and have about 120,000 contractors. so the original construct when they past medicare now 50 years ago medicare and medicaid was to have a small federal footprint, lots of contractors, very different than social security. we spend approximately $200 billion a day. of course n the lecture of $100 million. what i tell our staff all of the time is, you know, singular focus is how do we spend those dollars as wisely as possible, how do we try to create the biggest positive impact on people on the beneficiaries we serve and their health outcomes. today i'm going to talk about innovation and delivery system reform but i will briefly -- and i ask this person, i won't share

names because i can share names the abstract, i still work clinically at children's national center. sorry, it's not georgetown, i'm happy to do weekends here. you can work there, you just can't get paid. and so i called up -- i called up the division which i knew well. you can't pay me and he was like terrific. you are my highest employee ever. and another example of our system not working well, family, four other kids at home, by the way, no one had asked the question, when i told the team they were like no way, really. i didn't have medicaid people struggled with how to get them medicaid even though there's

fast-tracked process, stayed in the hospital, nobody -- everybody said, well the case manager is working on it to figure out there and children's national. it's a wonderful hospital. a health system in children. you know t social construct and i will come back to this a few times, their family and situation hasn't been fully taken in to the clinical care environment. we were able to intervene on a weekend to get them set up with the appropriate resources so they could go home, and you know, the -- having four children myself i think we often minimize those social constructs. so i can't tell you the number of families when you start talking to them that i've taken care of that have a child with multiple chronic conditions, you know, have lost their job because of the inability for our system to support them for the care of that child. when i tell that story because i try to orient us back to the

impact on real people and the health system w. that i will dive in. even though i'm from a small town of texas,i talk fast so i will prewarn you. what's our evolving state, we are evolved to outcomes oriented, and innovation and how we get there. we are trying to have a number of system and policy levers, everything from accountable care organizations to value-base purchasing, transparency on quality and costs, medical homes, et cetera, to get there. when we talk about delivery system reform, we talk about better care, smarter spending, help your people. short aside it used to be better care, lower costs, healthier people. we actually consumer tested

this. this may not surprise. lower costs, no one likes. sounds bad. smarter spending, everybody likes smarter spending. better care, smarter spender and healthier people. then we talk about how we pay providers and how you get incentives right and care delivery well, behavioral care. you do not need to memorize details of it. now it's actually been taken up across payers as well. it's a payment framework, so category one is fee for service, no linked to quality or cost. category two is fee for service payments with a link to quality or cost, payments like hospital

purchasing or adjusting payments to hospitals up or down to do order of $2 billion a year based on quality and cost performance. category three is alternative payment models, so the provider accountable for quality and total cost to care for a patient, population, so could be an accountable organization with where it's a population over a year, for example, or a bundled payment where it might be a person who needs a hip and knee replacement over in 90-day episode, so we are fee for service claims and often shared savings and some incentive. i will talk about this. you could also call it partial capitation or capitation payments but paying in a population-base way. in early 2015 the president and the secretary announced goals, for those of you who work in government, it's not that common that you set incredibly specific timeline goals that you could be

set accountable for. a lot of work to this preannouncement. we want to move 30% of payments, category three and four from last slide. by the end of 2016, 50% we want to have 85% in value-base purchasing payments. that's category two through four from the last side. and also said we want to work with the public and private sector to get there. i do like stories because they sort of bring it home. one of the stories i told internally to get us to announce the goal was i have a very good friend, hospitals, academic center ceo, known him for a long time. several years ago had lunch with him, this was before goal was announced, said, you know, patrick love what you're doing, great work, really changing the health system. you have to be honest, we will never be in any of the models.

i have been a ceo for 19 years, we charge whatever price we want and we are academic center x and i said, thank you, i appreciate you being very honest with me. i will see you next year. you know, we announced the goal and a lot of other things happened, had lunch with him, actually more than a year later and he said a few things that were telling, number 1, i know where you guys are going, like you very clearly said it. number 2, and this gets to the healthcare payment action that we will talk about, my payers will are going in the same direction. they said, no, we are going to negotiate aco contract, it's going to look like medicare's, you know, and that's the contract we are willing to give you. and then 3, and i think this is telling, he said the physicians and the clinicians and the leaders in my academic centers started coming to me and said, what is wrong with us, why

aren't we in these models, why aren't we changing. talk about the head of orthopedics. why aren't we investing in primary care? i think a telling story here on the cultural change to credit now in multiple models. the reality is the original decisions were not irrational, he was in a system with a board that was happy with financial performance and now as the system shifts, i think a credit to him and the physician and clinician and financial leadership of the institution, they're shifting their paradigm. how do we create that shift and how do we accelerate that shift? this show it is payment model. main point in this slide in 2011 we had 0% of payments. 2012, 20%. i think we are on track to reach

the 30% goal, that's the dark blue. the light blue is base payment. we are little less than 70% in 2011, on track to reach the 85%. you have a very small amount of payments left in traditional fee for service. so the majority of our businesses now through various health plans such as medicare advantage and medicaid manage care and through alternative payment models and value-base payment to providers. so there's a very small true fee for service left. this slide you do not need to memorize the details. the main point is increased percentages even if you stay in service whether you're a hospital or physician, clinician, if you look at the 2015 performance period, you've got 8 or 9% tied to various quality and cost metrics. a lot of work to do. we announced yesterday. so a lot of work to do to get the right measures, et cetera, but increasingly paying for value. and the main point of this

slide, we launched healthcare payment, we have some fundamental principles cmc and related is public and private-sector engagement. if we move together with private sector, much more likely to be successful. this is a network we launched to. first on line definition, we aligned on categories some sub categories with essentially the same four i showed you before. align on some payment models across payers, provider groups, et cetera, this group has eight of the ten largest private payers. over 25 states representing over 67% of the u.s. population, large employers engaged, consumer groups. it's challenging to manage that amount of energy, by the way, that's a story for another lecture. but i think shows our commitment to do this in a

public-private-sector-engagement mechanism. if you go back to 2010 and you look at cost projections and now you fast-forward for today, i could show you similar data. over $200 billion in savings, our own are appropriately conservative are now saying in annual report that some of this in the early years was the economy but we are also seeing fundamental shifts in the delivery system. we could debate for the next hour how much is which factor but we are seeing some fundamental shifts in the delivery system as well. one of those is accountable care organizations. you know, this is a program that's over time and essentially physician groups or hospital groups or other physicians and hospitals working together saying we want to manage a population of patients. the map, i apologize, may be hard to read. they are spread across the country. we still have a little bit less

density in rural areas than i would like. we recently made a big investment in what's called advanced payment to get practices into the model by essentially prepaying what will be their shared savings because they need the capital to get in at times. almost 9 million beneficiaries. many beneficiaries like my own mother who got a letter in the mail that said she was in an aco. what is this thing? chief medical officer of cms, i'm not supposed to answer the question but at your son i don't think you need to opt out. i started getting calls about medicines, her specialists and primary care doctor were talking with each other, and so a lot of this happens -- much of it

should and should happen engaging with the patient, there's coordination activity that happens in the background, if you will, so increasing numbers in the programs, the program, one of the first programs, leading-edge organizations taking on population-based risks, the main point of the slide, first model, innovation center which i lead the point is models and improved quality and lowered cost, you can expand them into the program without going to congress for new statute or new law. so the program was the first model to meet certification criteria because it improveed quality, six out of seven improved and hundreds of millions of dollars of cost savings. this was, you know, including some pretty low-cost organizations that published their results in the new england journal. so really positive results from pioneer program. monarch include the diversity --

i had been using data care who are also great examples. by the way temporary housing. this is a good story to tell. so one you go there amazing, been doing this a long time, in fairness. but just unbelievable culture of improvement. thousand-person care coordination system in a provider. mental health professionals, pharmacists, et cetera, they actually got so advanced they identified their homeless population was causing them significant healthcare costs, couldn't figure out how to solve for it and invested in temporary housing where they took people off the street, put them in temporary housing, figured out how to get them in their feet holistically in their life and could show a return on investment in this model because we are paying them differently. it starts to flip how you think about healthcare organizations traditionally do. monarch healthcare to give you,

monarch is in orange county private physicians, you a mix, it's a group of docs in california, afters very successful. so, you know, we've got small physician groups, relatively small physician groups, those that have the culture, leadership to get there for being successful, you know, is the model i want to call on primary care. fundamentally we believe that primary care is an important foundation for delivery system reform. this model, a couple of components i'd call out. one is multipayer. the majority of the payers and all the states and region came to the table. commercial, medicare, medicaid. all the exact same quality measures, if you meet certain quality targets, we want you to lower hospitalizations visits,

total cost to care, you can see the results up there. significant reduction and hospitalizations er visits and total cost of care, and so trending trending in the right direction, this wasn't hasn't been certified yet but positive results thus far. i think i have a story. i love this practice. so rural arkansas, you know, they did electronic care management. they have patients that come from very long distances, monitoring of congestive heart failure at home, home visits with their very frail elderly, effective palatable care at the end of life, deploying sort of the whole realm of clinical intervention. the doc said i am finally practicing family practice. i wanted to do this for a long

time. number 2, all payers put about a million dollars. we are all putting per member. all payers put about a million dollars. first year result greater than 3 to 1. he said, you know, i never could have done -- a million dollars, i would have mortgaged my house five times over because i'm a small business. you know, the third thing he said, i have to tell you, i don't tell the patients that it's obamacare but they love it. he was like -- [laughter] >> they love and there's two lessons in that message. he was like, you know, they love it. they get calls at home, they went to the nursing home and somebody sees him t pharmacists, we have a pharmacists that's part time on staff, a social worker, they love it. and so, you know, this is -- we have to work on the next generation of primary care models right now but really is where we wanting to in primary

care. has a long history of waiver that i won't go into details of unless you want me to but came -- secretary health and hospitals and josh former secretary, i have known him for quite a while, came in and said, we want to shift maryland to population-base payment models. these are over the course of five years they were supposed to have 80% of the payments to hospital, population based meaning every claim would get paid 20 cents or less on the dollar and the rest of the revenue would come from a complex formula that get population that we put in basically monthly payments into the hospital or quarterly year. different arrangements they choose. main point is it aligns them -- the way is you keep people healthy and out of the hospital.

.. we realize we could try to be a fee for service hospital was a population-based hospital. then we realized that was incredibly challenging and might not be able to do it. so we moved. they didn't all move the same exact direction but all moved, the majority population out of

the gate. i used to manage clinical transform make and health systems. of you're trying to manage your m.r. i. on one side of your books is a revenue generator and on the other side, a cost loser, that's hard to do clinically, but you tell a clinical team, best care for patients efficient results, evidence-based, easier to manage with one set. so i think a lesson there from maryland as well. consumer results. hospitals working on decreasing patient harm. 2010-102014, seven% of reduction harm, 87,000 lives saved. 2.1 million adverse effects avoided and $20 billion in cost savings. elective surgery which had been going up for years, major risk factor for preterm birth, 70%

reduction. central line infection over the are this period, 12%. go back further it's of 60% reduction. i remember the thinking being these things weren't preventible but they are and we preventing them at national scale. so re-admission, socioeconomic adjustment issues -- readmissions nonly going down as well. once again, supporting better care improvement, medicare advantage, star rating, just shows four or five star plans are higher rated. if you go back to 2012, you had 29% of planned that are four or five star. we now have a 55% beneficiaries and four or five-star plans for her to researchers in the room we dade randomized trial which showed results that wouldn't surprise you that is about to be published. we just sent some people a

letter that said you're in a three-star plan. here are their four or five star plans in your area and what they could cost, and the control group didn't get the letter. the group that got the letter switched at much higher rates. so like testing behavioral economics within cms and how they can drive change. on the innovation center i won't tell you about the models because we would not finnish time for q & a but i will tell you bat few others. on the innovation center, an interesting -- i'd managed in cms and what is historic cms for a long time, where my average group director had been in federal government for 28 years. the innovation center, we hire -- we certainly have people have been in government a long time. we're also hiring unbelievable amounts of new mbas, ph.d sad, former consultants, et cetera so interesting amalgam of people. up to 350 now. their whole point is -- i do the state of the theme in my talk

every year. we're small band of people trying to be like this amazing catalyst to help our health system achieve so whenever i recruit -- i'm recite something of you now -- we can't pay you more than the other people but you'll change healthcare in america, and then i'm also i say there will be another life for you down the road. a great opportunity to drive positive change. next iteration, -- basically i told you about pie anymore. this is the nexten -- we tell organizations here's your cost target, the quality measures, go forthand innovate. you immediate the quality targets, you will essentially share in all the savings. almost like a health plan that is a provider without the enrollment function. we even let in this model people, by-riz, say this is my a poe, my apo is georgetown and then they're in the population. so it's not exactly like -- a

lot of similarities and also things like waivers for telehealth, nursing homes, engagement by-riz, rebates to beneficiaries to stay within networks. a really interesting model. bundle payments, just briefly. increasingly paying for bundles of care. so classic example is a hip and knee replacement. we say we want to pay for a 90-day episode. we want better quality, lower cost for the episode. we have over 1200 hospitals, physician groups all over the country that are taking on two-sided risks to say we can do this better. we can work from hospital to post cute care with physicians and communities and get better results and decrease costs and they're willing to put their own finances on the line. these are all in two-sided risks. so that's how confident they are that they'll improve. we took that with hip and knee replacement we actually -- this is starting april 1st. we basically had good results that showed you can improve

quality and lower costs. other private pairs starting to go in this direction as well in 67 markets this is how we pay for the hip and knee replacement. a 90-day bundle and we want hospital and physician groups to work together. i think this could end up being as tran formative as things were -- transformative as things were many years ago. so really stretches our thinking about care delivery. we did get some pushback on this. not as much as you might think because people realize it's possible. at the end of the day this helps patients think about care, and one thing where we were getting pushback, we had a very nice grandmother who said i had hip in knee replacement. i didn't care about when you gave the antibiotics. i cared about that i got out of the hospital without an infection and complication, i was able to garden and play with my grandkids. that is what want you to measure and think about. so it really starts to push news a different direction.

oncology care moodle. a bundled payment for oncology care, episode-based payment for cancer care. somebody in at the front row likes it. i'm not sure why. you love cancer care, okay. we had oncologist coming to us, top of providers applied to this. they said we think we can do better. right now there's incentive to give high are priced drugs whether or not they're better for the parent, and we think if you let us deliver evidence-based care to patients, we do that in an episode-based bundle and we can improve quality and lower costs. so, that's our oncology mottle. we're also also putting in population based payments and help with care management and other aspects. medicare advantage, we have other models. this is just one to call out. value-based insurance design. a good example, we're learning from the private market. they had a lot of work in value based insurance.

you provide innocenttives to consumers beneficiaries to use high value services and not use low value services. so financial incentives. thinks like no copays for preventive services or low copays for very effective medicine, et cetera. so we're now -- that is occurring in at the profit market, results that look like they're very positive and we're testing it now in medicare advantage and hopeful it will have sill similar results. a good example of a health plan and consumer oriented model. accountability health communities, talked about this earlier. the real point of this model is we know that social determinants of health have emergency impacts on healthcare costs and in our state innovation model we saw states investing in communities to link public health and social services with clinical care delivery systems. so we just now -- this model is open right now. over $150 million investment. we'll try to invest in approximately 44 communities, three different tracks based on the level of intensity of investment and what they do in

the community, but really this ills another catalytic investment. the hypothesis here if we put forward this investment you'veing see communities come together, public health services, social services, and clinical care delivery systems and pairs and others, to drive change in a community. i knew we were on to somebody -- actually, the ceo of caesar's is like i got to tell you. if you launch this in atlantic city, i'll invest it in in it. i have 50,000 employees and i'm paying a lot of money, and i'm not sure what i'm getting for that money. and so i think this is a model that you can see private investment along with both foundational investment and private investment, like employers, along with federal investment. million hearts, it's another prevex orient blood we're directly paying practices for improving at a population level cardiovascular risks, focusing on prevention.

first-time medicare has ever done that. had a direct payment, directly into physician practices for population level prevention. healthcare choices issue want to spend a tiny built of time on. this actually originally -- i experienced this as a physician multiple times. this model is around medicare by law, you are either in hospice or getting curative care services. so the reality of the way most people transition in life is not that black and white. so as a physician and christian new york i dealt with it. we starting -- a little before this -- i dealt with my own father where it was a false choice. so this model actually allows palliative and hospice care services to be delivered the same time as curative care services, and there's actually evidence from the private market, good new england journal

study that people had much better quality, much better patient experience actually did save money, actually extended life, from the private market, the intervention with concurrent hospice and palliative care, even had a longer life span in addition to all the other positive benefits. so we're hopeful that will be true in medicare as well. if it is, like nye model, if the evaluation proves the results it could be expanded. so really thinking about hospice and pal -- palliative care and a transition that is patient centered and driven by the patient and family. state innovation models. we know health care changes at a state level so we have 38 states and territories we're putting in dollars, either testing or designing intervention at the state level to get better care, smarter spend, healthier people, just to call out a couple, arkansas, doing primary care medical homework, has all the pairs at the table, amazing bundle that i love. women on medicaid, they do a

bundle for pregnancy, all the way through one year postnatal. because the argument, which is evidence to support, is if you invest in prenatal and perinate cal you'll decrease complications and neilow natal infant morbidity and mortality and quality and cost improvement. interesting bundle. vermont is work only all pair aco, orb has coordinated care organization. a real mix at the state level. healthcare innovation, i won't spend much time on. we said we have all the great ideas in the world. we funds hundreds of innovation awards across the u.s. one exam, diabetes prevention program, liver by ymca, early results showing similar actually the roger trial results from nih and others -- losing weight, improved health outcomes,

decreasing rates of diabetes, innovative community based delivery model. transforming clinical practice. talked a lot about payment incentives and models. transforming clinical practices basically said -- this is not just this model but one example -- we know we have to invest in the support for people to succeed. so just getting -- if i just get the incentive rights and we don't instant vest in the support structure and -- it decreases their chance of succeeding. so this is over $650 million investment. we're partnering with organizations, regional organizations, to help physician and clinician practices, especially smaller and rural practices, to measure quality to improve quality, to measure costs and think about costs of a population to do true population health management to use they're

data to improve. really builds on -- we had hospital safety work which i showed you the results, collaborative learning model. this is now testing, can you have similar results in the outpatient setting you have a national learning network that then these practices can enter into our various alternative payment modeled and be much more successful than they would have before because we have given them the tools to succeed. i will say most -- much of my family is in small private practices around the u.s., so believe me, i've heard a lot about how my solo practitioner sister isn't sure how to participate in the new world. not sure if this will solve it for her but a step in the right direction in terms of support for physician clinicians. i know there are some physicianed in audience. macro, the replacement for the old sgr fix. i think lays out for'ses a pathway that is much more rome. there's one pathway with the

merit-based incentive system, paying for quality and value, and there's an alternative payment model that gaves five percent bonus became for physicians and clinicians in alternative pavement models. so direct insenttive for physicians and clinicians to move into a number of those models. we named earlier. we are very focused on implementing the models, rapid cycle evaluation, cms historically -- we had dem knows that man for many years and had a report that came out several years later. these models now, we're analyzing data, typically quart her, sometimes even more frequently, and we make judgments the models. so the bundle model, we have made adjustments along the way, including adjustments identified by participants as this is a problem you need to make this. so much more of a real learning system, continuous health care learning system, and we are trying to monitor and optimize

results. the portfolio analysis i will tell the one story i told earlier. the first job was at mckenzie consulting. i thought it's a little like venture capital and i had a bunch of people with me so i called a number of them but one guys, the funniest one was, i was basically calling him and he said, i'm on my yacht. can you hear me? i'm like, yeah, can hear you i'm on my backyard, looking at my neighbor's dog. thank you for pointing that out. and we went -- excuse me -- many others, went through a process of data analysis, think the portfolio as a whole, the long-term and short-term investments, whats working well and, what needs to be modified, model that need to be stopped because they don't seem to be working well. gaps that led to a number of thing is mexed earlier so we developed oncology, health plan innovation, next generation aco, advance care models. what are the gaps in portfolio.

trying have that learning rapid cycle improvement. we're actually implementing lean across the cms. someone wants to ask me, you can. i learned in the health system and now applying within cms, working maybe better in cms than the health systems which is interesting. and then this last slide. what can we do together. focus on eliminating patient harm, engaging in accountable care, so the story i told about the ceo is played out across boardrooms and small practices across america, so this transition can be tough but how do you make that transition to really focusing on better care, smarter spending and healthier people for the population you serve? i do think we have to invest in the quality of infrastructure necessary to improve. dat and performance transparency is critical so to drive improvement, which l it's national, regional, equipment your open health system or community, transparency on quality and costs, this issue of scaling success. we now are at a place, we have

seen more positives, delivery system electrons formation in the last three to five years than he with ever seen now. the challenge is, how do you scale that and how do you do it reliably, which is a serious collective national challenge. and so i don't think any of us know all the right answers there but i think how do you continually try to solve that challenge, and then lastly, relentlessly improve -- but sure and improve health outcomes. i want to end where i started. thanks for having me today. really appreciate it. it's a pleasure to be here and i look forward to the questions and a little bit of discussion. thanks a lot. [applause]

>> i'm an adjunct in the -- here at georgetown, and i'm real jim pressed with what you're doing itch have big question and i could stay here all afterasking questions. you made a passing reference in arkansas about the fact they don't call it obamacare, and one of the things that strikes me is that if -- you are not in the healthcare system, you think that obamacare is all about expanding coverage, and i've talked to journalists who are amatessed at the idea that there's something other than expansion. so that's the first question. that's the big one. the smaller one is, you're juggling an awful lot of things here and there are two parts. one is a lot of acos have gone bankrupt. how does that get resolved? and how do you juggle the different kinds of innovations and how they're integrated or not? because i think you're doing

phenomenal work. i work internationally and i keep talking to the world about what the u.s. is doing. we have a bad reputation and i don't think it's warranted anymore. so thank you very much. >> thank you for your comments and your question. i'll try to be brief with the answer just to make sure. the first one i think is one of the critical challenges we haven't solved for well yet, so there's -- you said this and there's been studies on this. the expansion of insurance coverage was one part of the affordable care act, but has been the part most visible and realized by the american public. i agree that there were huge parts around delivery system reform, innovation, et cetera, that we have not done as well as we could have talking about publicly, and i think really matter. like, having engaged population at the sort of american public level, plus engaged patients, really matters. so i don't -- i won't pretend to

know the answer how we solve for that but it's a discussion i have internally quite a bit and we're trying to trend in the right direction. it's truly bipartisan, by the way, sure be. yes? [inaudible question] >> longer answer. i've been in government twice. i'm with you. we'll work on it together. the international -- i keep getting asked to talk internationally but i try not travel too much but it's a sign that people are watching. on the aco point, it has been a mix. you have some successful, some not. the brief -- i mentioned this in a small group earlier -- the brief thing we're learning it's not physician or hospital or urban or rural. it's around culture, leadership, true population management techniques so i think there's questions around how do you make that more the norm and do people improve over time? does that answer all your questions? i feel like i missed one.

>> you did a great job. give someone else a chance. >> all right. >> so much of the chronic illness we're dealing with these days really to manage them you need behavioral health care, and so i'd like to know how much behavioral health care you're seeing put into these organizations that are successful, and to what degree can we attribute savings to the fact we're bringing in behavioral health care into the medical settings? >> a great question. so, first if agree that behavioral health and mental health is a huge component of both the quality and cost challenges in the u.s. and one we haven't solved for as well as we could or should. our acos for many of the successful one it's been large come come opinion components of their

investment. our primary care models seeing increasing mental and behavioral health investment. we even proposed last year -- so buried -- based on innovation and nih studies on the collaborative care model, telephonic, we proposed to pay for that in the fee for service environment and wire alonging at getting input. so that doesn't awful all the issues and at the state level, actually, we can't mandate what states do but state innovation models there's a huge work stream on mental and behavioral health, especially at the state level, as you know, they may have even different funding streams. they can -- we have a huge substance use did order work in our medicaid.

>> i'm going to try to point way up and way down. you'll get your steps. >> thank you very much. i'm from d.c. and we're just -- just started our health home on the series mental illness model and working on a second halve home and there's interest on the aco -- have you found that any particular model fits better for any particular specific illness? do you know like on health homes, yay, for mental illness, and the specific -- not the drg but a advancement for heart disease. do you have that kind of data? >> you know, to some -- this isn't going to be as direct answer as you want. traditionally we're seeing it a little less like condition by condition. this works for this condition and not for that especially with patients often have multiple connick conditions. i'd -- chronic conditions. it's more theisms management,

the population health management and how you manage people outside of the office visit, the data stream and how you sort of think about your data and using it to drive improvements. the leadership in culture -- people say how do you recreate that but it's true. we're seeing and it we have both -- qualitative and quantitative ways to measure it. and then i do think this linking to the social and community -- which i don't think not all acos are doing well yet to be frank, nor are all primary care practices, which is part of the reason we have accountable investment. how do you get the social determinants to health and that truck woven intimately and working well with what i'll call the traditional clinical care delivery system. those are a few things. it's not a "do this model" but the con desk and problems you're -- context and problems you're trying to solve models which one makes sense. >> other questions?

>> since i teach here, i usually don't need -- my question has to do with technology and how you keep track of the up to dated-ness of your information. specifically there is a decision from 2006 denying benefits for infrared therapy and generally biophotonnics. i've changed and there's been no update of this information of the decision in spite of the fact that the evidence-based science has totally changed since that date. >> one question to make sure i -- this is a coverage decision, either national or local coverage decision, i assume? yes. that was -- [inaudible] -- happy to look into it in more detail after. and the original center i ran i had like four or five jobs at one point so i gave unone.

just like academics. they they paid me no more for my four or five jobs. the coverage -- there's two ways we update them. one is we can self-identify something needs to be updated. used to be rarely did that. increasingly since i have been running ccsq we that could more often. if oonly open the things that industry bring to us we may not be opening most important thing. so i don't know this one so i'm happy to look entitle. we wrote criteria on when we should self-open coverage decision. we have an interesting coverage paradigm that is very different than europe. we have 30 people that run all of medicare coverage and the rhys all local contractors decisions. so my first question, which you can tell me later, the national decision in which case it's us, or local? if it's local we can write a national decision. the vast majority of coverage decisions are made by local

coverage because people in georgia know what people from georgia should get and it's a statute that never changed. and then we also get coverage decisions and actually any member of the public -- just so you know -- can ask for a national coverage system and if they submit a complete, with the rationale, reason, why you want to us open it, we're required by law to open it. we then have a cue of when we open it, but we are required by lawyer to do -- by law to do it. so fyi. last questions or should we wrap? >> probably wrap up. >> all right. >> one last. >> last question and i'll be short. >> i teach in the medical school and we have the problem of the attracting more students into primary care. do you think this is going to decrease the gap between specialty and primary care salaries or attract more -- a better lifestyle for primary

care physicians? >> i do. let me explain why. that was super short. i'll give you a little more answer. for the students in the audience. i've had multiple times where i made decision that mentors often told me not to do. i was choosing between pediatric specialty and my own mother, who i love, and all my mentors knoll do the surgical subspecialty, are you kidding in and i did pediatrics. so i think we're shifting the dynamic. so i look at a couple factors. one in our fee schedule, which there's a table which you would never want to read but i read every year. over time our primary care numbers have generally been going up in terms of fee for service payment. so i think the bigger change is these alternative payment models. that practice with the order of a million dollars, that's a four physician, four practitioner practice. that gives you the level of dollars going into that practice. that's a totally different

paradigm. granted they have to citied and do well to get the dollars, et cetera, but i think it creates a different financial environment for primary care. i think acos as well increasingly are -- they cannot possibly -- it is incredibly hard to be successful. i won't say impossible -- incredibly hard without a really effective primary care work force. i say primary care work force and i mean that, meaning physicians, nurse practitioners, physician assistants, and everybody else who supports them. so the whole team. thanks a lot for your time and questions. [applause] >> just in closing, thank you very much, pat, for sharing updates about the great progress you're making at cms. it's a very encouraging message to see the progress we are making toward these aspirational goals at tran forming our healthcare system and see the innovation in our country. there's us a obviously great deal of interest. i think counting our virtual

participants and online, this is the largest lecture audience we have had in recent history so that's very encouraging as well. [applause] >> and given the great progress that you're making we would loaf to have you back, perhaps next year, to tell us about the additional progress that we have made. so, thank you once again for all of the participants. there is a reception right outside the odder toum and we welcome you to come join that. thank you. [inaudible conversations] >> tonight on the communicators, gordon smith, president and re-ceo of the national association of broadcasters successes his terms if fcc chair tom wheeler's -- opening the set

box -- >> respect the fact the chairman is looking at something. chairman wheeler, if nothing else, he is to his great credit fostering competition. and he is looking at one of the real cost centers in the paid television industry. so i understand why he is doing that. i suppose that as a consumer myself, taking on my broadcaster hat, i'm saying who i ills the newgate keeper, amazon, goingle? i don't know. if it's one 0 of those rick right now we have to negotiation with directv or satellite or dish or comcast and cable, time warner you name it. those retransmission consent negotiations are happening all the time, and 99.9% of them end without any difficulty at all. but they're paying for the content. so if it goes to a new settop box with a different gatekeeper,

my question, putting my broadcast hat back on, is, how about my copyrighted materials. irthey've going sell aileds on that? if so do they have no responsibility for what they then well take from broadcasters for nothing? >> watch by the community indicators "tonight at 8:00 eastern on c-span2. >> an interview with the top democrat on the house ways and means commit year, congressman sander levin of michigan. discussing his concerns boat transpa serving partnership agreement, raging from worker rights. it's about one hour. >> our guest is representative sander levin. his last visit was in may 2015 square glad he came bat. he is a detroit native and earn his bachelor's degree at the university of chicago, a masters in international relations from

columbia, at and a law degree from hard varmint elected to the michigan state senate in 1964 and served as the senate minority lead leader from 69 to 70. dirk the carter administration he was assistant administer glory the agency for international development. he was elected to the u.s. house in 1982, four years after his brother, carl, was elected to the senate in march of 2010, representative levin won the gavel as the chairman of the ways and means committee served until the republicans took back the house majority. thus ended the biographical portion of the program. now on to the ever so exciting recitation of ground rules. as always we're on the record here. please no live blogging or tweeting. in short, no filing of any kind while the breakfast is underway, to give us time to actually listen to what our guest says. there's no embargo when the session ends. to curb your selfier urge, we'll

e-mail pictures as soon as the breakfast ends. as regular attendees know if you would like to s a question, please send me a subtle nonthreatening signal and i'll happily call on one and all. we'll start off by offering our guest the opportunity to make opening comments and then move to questions from around the table. thank you for thing do is. the floor is yours. >> well, thank you, and thank you for all you joining us today. 'm beating the traffic. some of us have talked before about trade issues. the battle over trade intensified the years i have been here. i was thinking become to the uruguay round where we brought up the results, and there war some controversy but not a great deal, and we put it together

fairly easily. but since then the battle, also i said, has intensified, and in some respects, you can draw the lines this way, between those who felt essentially that the old model worked, that comparative advantage still ruled the day, and that country traded, each country would come out best and there really wouldn't be any losers. others of us thought that the old model did not work well as conditions had changed and that you essentially needed to shape trade policy. so, what happened today, going back some years, in 2007 i led

the effort with the democratic majority in the house to essentially draw a new course for trade policy. we -- for the first time, put into trade policy international standards in terms of environment and worker rights. we addressed for the first time what became controversial, the isds issue in terms of dispute settlement, and also we put into may 10th provisions on medicines. well, as tpp unfolded, clearly an important agreement, an agreement that involves 40% of

the gdp of the world, i laid out a year ago, as some of you know, what i felt were important guidelines for the transpacific partnership. so i've worked hard, worked with others, listened to others, we held the forums, as you know, and i've now concluded that the tpp as negotiated is short of an acceptable outcome, and i do not support it. there are four key issues and i want to go over those with you today there are others, medicines, the environment, state-owned enterprises you may want to talk about, but i want to focus in today on four areas

which i think fall short of an acceptable outcome and why i cannot support it. worker rights, rules of origin, currency manipulation, and investment. let me start with worker rights. i'll start with malaysia and vietnam. they have deplorable human rights conditions and conditions relating to worker rights. i focus in on worker rights because essentially what we have been trying to do is to -- is international trade agreements unfold, to raise standards instead of other race to the

bottom. in vietnam today there is a consistency agreement that the usgr has worked out, and there are some important provisions in it. however, if your look at conditions today, the main consistency is to vietnam inconsistency as to worker rights. when i was there about a year ago as part of the delegation, led by nancy pelosi, i met a woman who had been in prison for four years and four months for trying to organize workers into independent unions. recently as she was trying again, she had been released from jail. she was beaten and beaten

terribly, simply for trying to exercise the right of workers to organize. in malaysia, the situation remains deplorable. and i think there's deep concern with this present leadership in malaysia that what is in the consistency plan will become a reality. let me gist say a word about what we did with may 10th. when we negotiated peru, we insisted that the changes be made in terms of worker rights, be implemented before we voted on it, and that was done. right now, with vietnam and malaysia, the implementation doesn't have to -- doesn't occur

until the agreement becomes effective. so, by that time, congress no longer has a say. we're out of the picture. and so i find that very unsatisfactory. let me just say a word about mexico. i was there rather recently. what is happening in mexico is more and more of the automotive structure in this country is moving to mexico. in the last four years or so, there has been an investment by automakers, both the big three and the other automakers, $25 billion in mexico. it is now becoming 2009 largest auto producers in the world.

and the vast majority of the trucks trucks and car that are built in mexico come to the united states. what is happening now in terms of the movement of the auto industry to mexico is being duplicated, as you perhaps read in other industries, carrier now is closing planters in indiana and moving them to mexico. one of the reasons for this movement to mexico -- it isn't the only one -- is the huge gap in wages and benefits between the workers in mexico and the workers in the united states. the average, as of a couple years ago the average wage in the auto industry in mexico was $8, and for some working in the

auto parts industry, it was $40 a week. one of the reasons for this gap is the absolute inability of workers in most of mexico to be able to form a union and to bargain collectively. they have a system in mexico called so-called protection agreements, that often are signed before there are any workers, and in any case, the workers have no say in what are the terms of the agreement. there is no consistency plan at all for mexico as there is for vietnam and malaysia. the discussions have been between the two governments outside of tpp, and at this point, we have no idea as to

what will come of them. so, essentially in the auto industry and manufacturingplx# say a word and then i want to try to do it briefly so we have plenty of time for back and forth. >> good, you're reading my mind. >> it says 9:15. the rules of origin essentially say what the content must be in order for the trade preferences

to apply. and the problem is that from what we can determine, the rules of origin in tpp are weaker than they were in nafta. so, essentially you have this possibility, when you have a rule of origin that looks like it's considerably below 50%. the opportunity for automakers in mexico to meet the requirements for the tariff prefer reps and have more and more -- preference and have more and more parts come from places outside of mexico, like china and vietnam. so, when workers in this country are deeply disturbed about the unlevel playing field, you can understand the reaction to a situation where more and more

manufacturing in this country is moving out, and under conditions into mexico where workers are receiving maybe a fifth or a sixth of the wage as true in the united states, and there is no plan in place to change that. so, let me just go on and say a word about currency manipulation. as i look about, i think you guys have heard me talk about currency manipulation. it seems like forever, but we lost between 2 million and 5 million jobs in this country because of japan's currency manipulation and then china's. two to five million jobs. we have insisted that there be a change and a meaningful change in what exists today that has

been negotiated with the finance ministers is simply unsatisfactory. i just want to give you one example of the impact. i was going last night over the korea free trade agreement. i participated in the -- it was called re-negotiation because koreans didn't like that term -- in the re-doing of the korean free trade agreement. we did that when we took over. i kind of stuck my neck out. i said, let's try to make an agreement with korea work. the huge deficit is primarily in automotive and let's try to find a way to break through the korean barriers to our manufacturing products. so, we re-structured it. it was controversial.

most of the benefit, if not all of the benefit, was wiped away by korea's currency manipulation. and so, today korea's automotive market remains almost as closed as it was when we negotiated the agreement. let me just say word about investment, isds. i said in this letter of a year ago to ustr that there had to be substantial changes. you know what is involved. whether an investor, instead of going through the legal system, can essentially go through arbitration. and as of some years ago, that wasn't happening very much in the united states. we said, though, that there's increasing use by investors

going outside of structures that are well in place like the united states or australia or canada. we needed to put changes in place to make sure there wasn't an abuse. the decisions continued to come out indicating it was a problem. there was some progress made by ustr, but in my judgment, not enough, and the recent filing in the pipeline case i think shows the dangers to environmental and health provisions in the united states because essentially what the pipeline company is doing is filing a $15 billion suit and not going through the legal system of the united states but going through arbitration. so, let me close by talking about the international trade

commission report. i forgot this. there was no itc report on nafta. itc is supposed to look at all of the economic aspects of a trade agreement and figure out how they'll come out in terms of working families in the united states. they're now undertaking this, and i put together testimony and i sense that all you -- indicating why they needed to do something differently than has been true of models that have been used. a recent model came out of the peterson institute sponsored it, and essentially what it said was, using the old model in terms of growth of gdp for the united states it would be

four/tenth's of one percent in 15 years, or over 15 years. that's all. much more for vietnam and for malaysia. but even that four/tenths of one percent over 15 years i think is very much in question because that model assumes that there will be full employment, which hasn't occurred. that model assumes that wages will keep up with productivity. that isn't true, hasn't been true. that model doesn't look at issues like income inequality, a major issue today. and that model also doesn't look at specific sectors. so, i urge the itc to use a very

different model to look at these issues, and they're going to have a report by the middle of may. i hope that will spark intensive discussion about the essence of tpp, and whether it really will benefit the working families of the united states. so, let me just close. i want to read just the last paragraph, if i might. all of you have a copy. some will say the tpp is an improvement over the status quo. you'll hear that a lot. others would say that we should not -- that the perfect be the enemy of the good. by the way you probably heard people say that hundreds of times. regardless of whether those often rhetorical measuring

sticks were relevant in the past in trade agreements simply equal trade reductions, they vitally missed the mark today. trade touches all aspects of our lives, and we are setting, through tpp, an economic framework for generations. we cannot afford to lock in weak standards, uncompetitive practices, and a system that does not spread the benefits of trade, spread the benefits of trade that has been the hallmark of what i've been fighting for instead of the old model of comparative advantage. affecting the paycheck of american families. to not get it right is to get it wrong, and this tpp, as negotiated, is not right for

america. and that essentially sums up why i cannot support tpp as negotiated because it falls short of acceptable outcomes. >> let me do just a quick overarch question and then we'll go to doug -- >> i'll take my hot tea that is now very cold. >> sorry about that. brian, kelsy, and paul. so, a major player in trade comes out against tpp. is it your view tpp is dead certainly at least for this year and continuing into 2017? or what do you see happening next as a result of your rejection? >> let me just get some paper here so i can take notes. >> no fair you taking notes. only us. >> you can pull out a decent piece of paper.

>> i'll put out a piece of paper for you. >> look, let me say two things. some of us know long enough dish don't like to focus on timetables. i think the focus should be on the substance of this vital trade agreement. and that is basically why i'm speaking out today. next week there are going to be more and more people coming to washington, urging support. many of. the will be in the agriculture sector, and i acknowledge the gains in agriculture, but let me just say a word about it, because those are exports. and there's been a failure -- that was shown in the report of the council of economic

advisers -- to look at the impact of imports as well as the advantages from exports. so, i think next week there's going to be an intensified effort to convince people and that's why, after looking at all of this, having the forms i helped put together, i'm speaking out today. i'm not sure what the course is going to be between now and the end of the year. paul ryan has indicated his concern, and let me just say, in several indications i don't share them at all. tobacco was one of the pluses negotiated in tpp as part of the isds, the investor state dispute section. maybe it shouldn't have been in but it's there.

that should stick. the tobacco issue essentially says a country for reasons of health should be able to do anything they want to protect the health of their citizens. and i think it should stay as it is. medicines. paul ryan has also indicated unhappiness about that. when we put together may 10, we spent a lot of time -- this was in 2007 -- on the medicines issue, a lot of time. it was very controversial, and what we did was to strike a balance between protection of intellectual property and the access to medicines and came out with a five-year provision.

a lot of the pharmaceutical industry wants essentially a 12-year provision in terms of data exclusivity. i won't go into the exact meaning of that. i think they're wrong. what was done in tpp at the last minute -- and i was at every one of the meetings -- was to reach a compromise that is a little hard to understand. it talks about five years, which is what is in may 10th, but it could go under some circumstances to eight, and the pharmaceutical industry wants 12. i income the may 10th 10th provision that we worked so hard on is the correct to biologics. as we intended.

so, in answer to the question, i'm not sure of the timetable. i think within our rank there is a lot of opposition to it for the reasons that i've outlined today. we'll see. i don't know. ...

>> it has been a controversial my position has never been no tp p. my position is you have to address these major issues that i outlined a year ago. i think fit those objectives have to be met. hillary clinton has expressed her serious concerns about tpp. i went back and looked at her

comments when she voted against cafta it years ago and she outlined the issues that related to that that are very much alive today. i think if she were elected president i would have confidence in how she would address trade issues, but it is hard to predict what is going to happen in the election. >> do you see danger to the economy with the u.s. being seen as anti trade. did you see risks? >> i am not anti trade. i don't think most democrats are anti trade. just look at my career. >> been mean to insult you.

>> we put together the authors -- charlie and i wrote it. it was accepted by the administration. we put may 10th into peru. a majority as i remember of democrats voted for peru which incorporated the may 10th provisions were rights in madisons, change their laws before we voted and charlie rangel and i went down to peru to be essentially mark the success of the free-trade agreement. let me just say there have been serious problems in the implementation which does lead to more and rest within the ranks of those who favor trade that has to be done in the right

way. we put into drew the most innovative environmental provisions in a trade agreement. because the amazon affects climate, i know republicans don't believe this but because of climate change but the problem is for those important provisions on deforestation it has not been effectively implemented. in terms of anti trade, you need to look at the record myself as we tried to shape trade agreement is, for most republicans is more trade the better, regardless of its content basically but for us it has been the need to have a trade policy and shaped its

terms. and and essentially raising the standards upon which trade agreements were negotiated. >> going forward do you see the role you are going to play to maintain, similar to what many republicans said they don't support the deal being they are going to try to convince the administration to address their concerns or conversely would be joining forces democratic advocates to the deal. to attract public opposition to the deal regardless of what comes up for a vote or not. >> i am opposed to tpp as

negotiated. with this sparks the speed of the administration to move ahead for example on currency, to move ahead with mexico. right now there is no plan whatsoever. workers continue to be suppressed. whether it will change the dynamic today in vietnam. i can't vote for tpp when the person i met who was been jailed for four years trust organized in vietnam and they send pictures of her having been beaten for doing what in the consistency agreement vietnam

says can happen. >> kelsey snow from the washington post. >> two part question. i want to talk about the politics of having one president negotiated a trade deal and have it be completed under another president, i wonder why you think that has become practice and what it says about the way people are thinking about trade and spiegel little bit more about your concerns about how this would impact, you mentioned the difference between tpp and naf nafta, whether this corrects the problems democrats have long had with this stuff. >> we made progress when there was a change from bush to

president obama. under president bush we did put together the may 10th agreement. it wasn't exactly an agreement. it was put together by house democrats and it was accepted by the bush administration assuming that that might lead to acceptance of panama, colombia, korea. that did happen. i sat down and began to renegotiate at the panamanian embassy taken may 10th and the panamanian parliament speaker became someone who had killed a

marine. so there was progress when we changed from clinton/bush to president obama in terms of renegotiating those agreements. sometimes it works for the better if a republican became president, i think much of what we have done they would try to wash away. that our efforts and new trade policy they would try to reverse. so we will see. in terms of rules of origin, i had recent discussions with u r ustr. our staff has been trying to find out from the administration what they think is the meaning of the rules of war.

i just want to make this real. essentially they decide how much content has to come from where. they are very technical but they really matter. what happened was nafta had the 62-1/2% rule of origin for the three countries. the rules of origin in tpp have lower figures. i don't understand why that was the result and there may be a claim that it will work out for the best, but we have been

totally unable to contain from ustr any collaboration as to why this change will not lead to what i said because when i was in mexico, parts companies gave me a chart that if the rules of origin were changed from 60 to 40, half of the parts companies in mexico would disappear are. the lot of those parts companies came from the u.s. to mexico as automotive production shifted from the u.s. to mexico. we are talking about $23 billion of investment in mexican plans in the last few years by producers in the united states. so there is a real danger, i think come as i said here and i

said so rather colorfully to try to make this thing really work. and i will quote myself. >> a safe thing to do. >> it isn't always safe. and it says in other words, u.s. consumers find themselves deriving tpp cars. that means product from the three countries or trucks with half of their parts by value made in china or elsewhere and the vehicle itself assembled in mexico, this model comes with job loss as standard equipment. >> we had 18 minutes left. we go to eric watson, ben hancock. >> i will try to be -- i won't

quote myself. >> michigan -- they go together really well. what if tpp does go through, what will happen to u.s. auto partsmakers and do you find it ironic that the president to ease essentially saved the auto industry could be killing it? >> he saved the auto industry. the problem i have with tpp as negotiated is to mexico, there is no plan. as long as workers make one 516 or less there is a strong inclination to move production

to the lower cost. i am not saying it is the only factor. labor costs are less proportionately -- if a major plant moved from michigan, the savings could approximate $300 million. so our government needs to face up to the fact that mexico is essentially suppressing its workers and as i said, in the last years, productivity went up, wages in mexico went down, we need to eat effectively address that equation. and this tp p.s. negotiated

fails to do that. >> what is the end line and packed on auto and auto parts? >> labor costs be issue must be addressed and addressed effectively. so far it hasn't. >> eric watson from bloomberg. quick question on tax policy. next week there will be a hearing on international tax reform. understand you are working on an earnings bill. talking little bit about that measure and when you plan to introduce a new scheme happy on inversion and international tax reform. >> i am introducing it next week, any stripping, the republicans fail to move on a version and as long as they fail there will be more in versions like the ones announced a week or two go. so i think we will have the

hearing, we need action. >> we are going to go to bloomberg. >> characterize what you think happened with the automotive rule of origin and negotiation and identify countries that are winners and losers in this. >> i was there at these meetings and i don't know why the rule of origin can down the way it did. my understanding is in the end it was in negotiation between four countries. canada, mexico, u.s. and japan. as i understand it, japan was strongly opposed to the kind of rule that was in nafta.

the matter of origin is a concern in canada. i don't want to speak for the canadian government. but the canadian government is reviewing tpp. and one of the issues is the rule of origin. >> good to see you. many of us have seen you. many of the tpp negotiating sessions. and you have dived into the substance of the agreement to come to your final verdict on the transpacific partnership, and negotiate it. however, there is a backdrop in washington where many many people are opposing a presidential candidate from donald trump and ted cruz to bernie sanders and clinton and

also have leading republicans who supported fast-track trade promotion authority, not in raising the deal. you have been in washington while. would it be political suicide for someone to support the agreement now in the mainstream district and if so, a disagreement scarred by inability to please vote both sides of the aisle. >> some people were in patient. and democrats and the country where we had differences of

opinion forward. i base my decision on what i have been working on all this time. this issue as people come here to washington to lobby. as this picks up, and i wanted to stage a conclusion as to where i am after all of this work. i have heard candidates, i have heard donald trump talk about mexico and china and let me just say i don't give any credibility to anything donald trump says. >> is it salvageable? realistically, you caution you don't support the deal as negotiated. do you support in the near-term political environment in the

next 12 months or 18 months a way to salvage the trans-pacific partnership? >> what is going to happen now is the debate will intensify. points of you like mine need to be heard. we are going to have the itc report. my hope is it will dig into these issues that i have mentioned. i very much reject the model that was used for the report that came through peterson. i said a model that assumes full implement isn't a model that will come up with answers. what will this mean in the lives of american families, that is

the basic test. debate will ensue and on constructive lines donald trump pushes the but not, he says mexico and china, if you pushed him as to why i think he would have trouble spelling out the problems like i have spelled out. >> a list of demands, they are diametrically opposed, and the administration has pretty much tried to accommodate the gop. to do anything to move in your direction. you mentioned mexico a lot.

you don't support this as a negotiated. somehow going beyond what the next administration said it will do, one way to improve tpp to get your support. >> let me be quick about this. and mexico had a system for 70 years. and gives the back of the hand to work right. we now have a system of so-called protection agreements that harken back to the united states before the national labor

relations act. it used to be called yellow dog contracts. sometimes they are made before there is a single employer/employee. nobody knows what is in them. among the employers, employees. and you have -- you have the board that is rigged against employees. it is a tripartite board, the employer, the government, the employee, employees are represented by unions that are part of the government. i know that the government has said it would do certain things but they haven't done things and will there be a basic change before we vote?

so that workers in mexico really have the ability to be represented in the work place? you can't expect workers in the united states as mexico competes more and more to say okay, when essentially mexico gains advantage economically by suppressing the rights of their workers and having more and more plants move to mexico. and so far those plants involved certain products but if there is not a major change, this movement of production from the united states to mexico could only accelerate and involved many more products. i've been to emphasize it is not only automotive, the carrier

announcement indicates what the problem is. they are moving down to mexico because they have suppliers there and because the costs are less is one of the reasons. that equation has to change. >> follow up on that. >> two more to squeeze in. >> how do you make that mark when you already have nafta? how does that make things worse with mexico? rules of origin allow it to work? what is the change in mexico? >> right now if there isn't a very basic change, it locks in the status quo. in terms of rule of origin it could make it worse. >> from cq. >> answer it this question.

in the abstract, if you take donald trump's positions as arctic and the or spelled out on trade, what daylight is there between his professed stance on trade and yours? >> what do you mean? if you take trump's positions on trade, what they light is there between you and him? >> there is complete they might, there is no reality. he never says what do you do? he just pushes a button, to make

trade works you have to be in the trenches and you have to do things and can't just -- look. i have been opposed to pushing buttons on trade for 30 years. you don't -- you don't make trade benefit the working families in the economic sector of the united states simply by codeword. i have no confidence whatsoever -- i think for it from it is rhetoric and what we need which trade is a reality. >> last question from the new york times. >> given your opposition to global trends that as others eluded to these things are happening that are bad for american workers in many cases, but there are things in tpp as

you point out that are holding malaysia, vietnam, to standards that don't currently exist, to make changes they would not otherwise have to meet. how is the one you mentioned to was in prison for four years and four months better off without tpp than she would be with the changes tpp would force? >> because if the changes are going to be real, they can't be contradicted by conduct right now. you can't say the document is going to be worthwhile if the practice today is in total contradiction. i think it makes it -- it

undermines the credibility. let's remember we are talking about changes that would occur, the agreements, consistency agreements come into effect when the documents and into force after we would vote and whatever is to occur, when the agreements entered into force. the main issue in vietnam is whether they can exist in vietnam organizations that workers can organize not only at a particular place but can evolve a structure where there is true labor movement independent of the communist party. right now there is one union

that is part of the government. if you believe those changes i going to be real, they should occur in meaningful ways before we vote and most importantly if there's any credibility the vietnamese government has to stop beating up people who are trying to form an independent union. >> want to thank you for doing this, appreciate you coming back. >> i appreciate, you work by the clock unlike congress. so i appreciate the chance, keep in touch because there will be more and more activity here next week as various groups

issue to put it mildly.