d ranking member stabenow for inviting me here today. as i was introduced i'm sandra hassink and i'm president of the american academy of pediatrics a nonprofit professional organization of pediatricians and pediatric medical subspecialist whose mission it is to obtain the optimal physical social health and well-being for infants childrens, adolescents and young adults. it's an honor speaking about my life's work -- hield hood obesity and the connection between nutrition and health. the foundations of child health are built upon ensuring the three basic needs of every child -- sound and appropriate nutrition, stable responsive and nurturing relationships, and safe and healthy environments and communities. meeting these needs for each child is fundamental to achieving and sustaining optimal health and well-being into adulthood for every child.

early investments in child health and nutrition are crucial. the time period from pregnancy through early childhood is one of rapid physical, cognitive emotional and social development and because of this this time period in a child's life can set the stage for a lifetime of good health and success in learning and relationships or it can be a time of toxic stress when physical, mental, and social health and learning are compromised. micronutrients such as iron and folate have demonstrated effects on brain development but are commonly deficient in pregnant women and young children in the united states. these deficiency cans lead to delays in attention motor development, poor short-term memory and lower i.q. scores. one of the most effective investments congress can make during the prenatal to school age period is to support the special supplemental nutrition program for women, infants and children, or wic and i thank the committee for its strong bipartisan support for wic over the past four decades.

wic helps give children a healthy start at life by providing nutritious foods, nutrition education and breast-feeding support. children who receive wic have improved birth outcomes, increased rates of immunization, better access to health care through a medical home, and participation may help reduce childhood obesity. wic has also played an important role in promoting breast-feeding and improving breast-feeding initiation. we recommend that the committee seek to find ways to promote breast-feeding initiation and continuation even further in the wic program including by an increase in the authorization for the breast-feeding peer counseling program for $180 million. wic is a targeted intervention for mothers and young children with impacts that can be long-term in nature, including improved health outcome, educational prospects and the prosperity of our communities. as a pediatrician i've seen firsthand the importance of nutrition in child health.

when i started my practice in childhood weight management 27 years ago, i was seeing adolescents. when i retired last october i had a special clinic for children under five with obesity and we were seeing infants. these children were already showing the effects of their increased body mass index on blood pressure and measures of blood sugar control. we saw obesity-related liver disease in four-year-olds and in children with pre-diabetes at age six. today our children are experiencing an unprecedented nutritional crisis resulting in the double burden of food insecurity and obesity. the connecting factor for both is poverty. the highest rates of obesity are found in people with the lowest incomes and increasingly the picture of food insecurity in children is that of a child with overweight or obesity consume ago poor quality diet. good nutrition is not only an essential component of chronic disease prevention and treatment, it also helps treat the effects of chronic hunger.

wic is just one intervention to address the double burden. families or school, child care, communities and certainly pediatricians play an important role in shaping healthy habits. when you're in the middle of an epidemic, you cannot keep doing what you've always been doing. as pediatrician, parents community leaders and policymakers, we have an obligation to ensure the food we provide our children is healthy and nutritious and that we model healthy eating as adults. good nutrition in childhood sets the stage for life long health and just like we vaccinate to protect against illness, we can also vaccinate against chronic disease by providing pregnant women and children with nutritional assistance and breast-feeding support. and as we celebrate our mothers this weekend i urge the committee to put mothers and children's nutritional needs first. our children's health simply cannot wait. thank you. i'll be happy to take any questions. >> thank you very much.

we will proceed with questions. i know the chairman will be returning in just a moment so thank you to each of you for your comments. we very much appreciate. dr. hassink thank you very much for reminding us all what this is really about in terms of children and the health and the stake we have in children being healthy and having a chance to succeed. mr. goff i wanted to start with you because when i think of west virginia, you have all kinds of school, you have rural, you have urban, and yet your state is 100% compliant with the new meal standards, including smart snacks. looks like you were ahead of the game anticipating things. i want to congratulate you and the state for that. and i'm wondering how you were able to get -- to help your schools in this state to be able to achieve the goals and then secondly when many schools rely on the a la carte sales to

supplement their budgets, and we understand tight budgets for schools, but the change to healthier items doesn't seem to have impacted your schools. so how did you help schools be able to achieve and how is it you were able to do that including a la carte sales in a way that didn't hurt your schools? >> thank you for the kind comments. when we adopted the standards in 2008 right after they were released and we put together a very comprehensive implementation plan. as far as bringing the schools on board, you know, we went through the black eyes like everyone else is going through with the healthy hunger free kids act but we used quarterly workshops. we created a list serve where we could communicate with each food service director through the internet with the push of the "send" button. we issued guidance memos. we met with principals groups,

we met with superintendent groups, we did presentations before boards to get the word out and let them know just why the standards were changing and why we were doing what we were doing and the science behind it. we created a web site called smart foods for parents to educate parents of all the changes. so we've had a very comprehensive implementation plan and we staffed at the state agency level in preparation for all the changes as well as far as grant writers and registered dietitians and things of that nature. and our automated system where we have an electronic technology system point-of-sale system that's integrated throughout the entire state, they just need to know one system. our reviewers go into the schools, they just have to monitor one system. many of the concerns that mr. lord spoke of we don't

experience in west virginia. because the direct eligibility determination is done at the state agency level. and we notify the schools of that information. our free and reduced application is online. so we've had a lot of the problems with -- that we experienced with the paper application which is basically become obsolete in west virginia. as far as allah la carte children in the cafeterias gets a meal pattern that's fully reimbursed whether it's free reduced price or paid. we just felt that that's in the child's best interest. we also worked to have salad bars put in place. now, with -- by not offering an la carte sales that makes the point of sale activity. that lends itself to increased accountability as far as logging and claiming the meals.

the -- we have never had an issue with -- as far as the revenue goes on an la carte sales. you get the full price of the paid meal and then you get the full federal reimbursement so you get both revenue streams in west virginia. a la carte. that was never an issue for us. >> well, it's very impressive what you have done and when you look at the automated point of sale and the statewide eligibility so that the schools don't have to be focused on that and it moves with the child. i just think that's really something that we need to look at and how we can save the costs and the paper work for schools and families and still achieve things so congratulations. mr. riendeau, we have had a lot of bipartisan support over the years for our summer meals programs and we want to continue that. we know we need to strengthen

both the con frequent gait and noncongregate models. i'm concerned we create more exflblt in michigan. we have sup o submitted a request for the requirements and in fact, unfortunately, it was denied because of the current restrictions when a waiver can be issued so i wonder if you might speak a little bit more about the need for flexibility in terms of the summer and what's happening in terms of communities, whether it's -- where children meet or what's been called grab and go or other kinds of models. why this is important. >> sure. and -- sure. thank you for that question. in our case, dare to care, we serve urban and rural counties and i think that's where the difference between the two models is most stark. the vast majority of the meals that we serve through sfsp are in jefferson county. it's a place where kids there are plenty of sites for kids to

gather in the summer sites with programming and activities that the kids want to be a part of, the kids are there. and it's easy for us to get those meals to those kids, have the kids consume them on site and allow us to you know, comply with the requirement of that program. in fact, we have our model is based on a 6,000 square foot kitchen we invested in to build two years ago that provides over 1,000 hot meals a day now and takes the meals to the sites and the program works very well there. where the need for flexibility comes in is is in our rural counties. 11 are rural some are very rural. frankly, they just don't have the community centers, the facilities for kids to gather. even if they did have those there's a transportation issue. these kids are spread out. many of them are living in hollows and small communities. they're dispersed across those communities. in the summer they don't congregate and so what we'd like

to see is the ability to work on the ground in those communities with government and business leaders in those communities to come up with unique partnerships and innovative programs that are tailored to meet the specific needs of those individual counties and i think you know, if we could have the flexibility that we're talking about here, i'm very confident that we could reach many, many more of the kids in need. as i mentioned in my testimony you know, 90% of the kids in the state of kentucky who are eligible for sfsp don't get it because there's either no site for them to go or they can't get there. >> thank you very much. thanks. >> ms. jones, cindy, thank you for your help in our traversing kansas and enjoying school breakfast and school lunches.

if you are provided with some that word again flexibility what changes would you make? >> i would allow us to go back to the 50% whole grains so we're able to add some of those items back that the kids enjoy. such as whole grain biscuits do not have much flavor. i don't know if any of you have tried them. crackers. they taste like sawdust. just some of those simple items, just like our children they love chicken null gets. all kids love chicken null gets. now with the coating on the chicken nuggets they no longer like the flavor. simple little things we could do with that. i would go back to encouraging kids to take fruits and vegetables. we keep hearing about, you know it is just a half a cup. but we have 29000 students in our district. that's a lot of half a cups.

and if two thirds of those kids eat the fruits and vegetables that's still 10,000 half a cups that we throw over and over a year that's one 1.7 million half a cups. in our district we want the kids to eat their froouts and vegetables. we have unlimited fruits and vegetables. we go into those schools all the time encouraging them, giving the stickers because we want them to try their fruits and vegetables but because of the tight budgets we are having right now, this may be something we have to do away with and i would hate for those students that want to eat the fruits and vegetables to lose that opportunity because other students are forced to take them and just throw them in the trash. also, i would like to be able to make the decision whether to raise the prices for our meals. i think a lot of our students are leaving the program because they can no longer afford to pay

the meals price. i was visiting with a little girl the other day and she said that her mother now makes her choose two days a week to eat with us. because they can no longer afford to pay those costs. so i would like to be able to do that too. >> we have just been joined by the whole grains champion of the senate who has a bill to exempt that standard. and i will give every opportunity to discuss that john but at any ratde, let me ask you, throughout my travels throughout kansas there were some schools doing well implementing the standards and they seem to be the schools obviously, with a lot of resources. and your testimony you mentioned that some high, free and reduced price districts in kansas have also overcome challenges.

is there a way to characterize the district that is are having a hard time or does it vary based on the individual community? the reason i'm bringing this up is that i think the distinguished senator from michigan and i tend to -- you put it to rural and small towns schools. smaller schools. >> right. >> and goodness knows they have problems with a lot of things. but i'm not sure i'm getting this exactly right. is there a way to characterize the district that is are having a hard time or does it vary based on the individual community and what they're doing, how they accept the program, et cetera, et cetera? i know there's been a lot of talk about training. i'm trying to get at something here. i don't call it the attitude of the community or the attitude of the district or whatever. not much choice in this regard. but help me out here. >> well, what i'm seeing

districts like my own, we have a lower amount of free and reduced. so a lot of those kids are making that choice to bring their own lunch. where if you're at a district that they have a high free and reduce, those kids pretty much still will eat what we -- what they are being served. i was actually speaking to a director from a larger district and he said that because of the revenue that he's losing with his students he will end up in the red for the first time and this was around his tenth year of being there. so i think that is a lot of the problem is those schools that do not have the high free and reduce, we don't have the ability to get a lot of grant that is are available to those high amount of free and reduce schools. in my district we have a centralized building. we have two registered dieticians on staff. we have to pay for all of our

costs, benefits. we even pay indirect costs to our districts to help pay for the utilities and the custodial staff at the schools. little school districts usually have someone within that school so they don't have all of the extra costs that large districts have, plus many of them have high free and reduced so they not only do not have the expense that we have they are able to bring in more revenue. >> well, you have given me the exact reverse of what perhaps some of us may have as a bias. and i truly appreciate that. that's exactly what i was asking about. i have so many different questions here. i would say to my colleagues. but i do want to get to senator don nelly who i think is next and then we have senator hoeven. >> thank you mr. chairman. i want to thank all of you for

being here. mr. riendeau, i know you're based in louisville but i want to let everybody know that you also dare to care, serves washington, crawford harrison, floyd and clark counties in my home state of indiana. we are grateful to you for that. and i wanted to talk to you for a second about something that i know you have heard about, as well. and that is, the area you serve just outside of it is scott county which is just to the north of where you serve and we have had a devastating hiv outbreak there and drug epidemic there. and the county also has one of the highest food insecurity rates for children in our state. and i was wondering in your mind what is the best way to reach those kids? to make sure they have had enough to eat to make sure they stay in school and hopefully stay away from drugs, as well. >> thank you, senator. and, yes, i live just down the road from scott county an i want

you to know personally i share your pain with what's happening there. it's horrific. you know i guess i think in my mind what's happening there sort of points to the larger issue that's before the committee with this whole reauthorization. that is, you know investing in our kids today can prevent so many issues down the road. we heard that you know kids who grow up in a food insecure environment are going to have all kinds of issues and as they age out, they find themselves with less options for becoming productive self sufficient members of our community. i'm certainly not an expert of drug addiction or hiv but i would have to guess that there is a very close correlation between the levels of food insecurity that you see in that county and some of the problems that folks are facing with no alternatives to turn to. and, you know, think the best way that one of the great ways that we could better serve

counties like scott would be going back to the ranking member's question about flexibility. giving us the ability to tailor programs to be able to provide summer food to kids in those rural counties where the current model and the current regulations may not fit so well. >> which ties in a little bit to my next question which is in that some of our rural areas you serve and the rest of the state and in the country there are pack a backpack program for kids on the weekend and such. and i know you help to work with that also. do you think that as you look at that we'd be able to reach more food insecure children if those meals in that program were eligible, free reimbursement as i know the funds come from private sector for that. >> absolutely. that program is -- in our case with dare to care and serving the rural counties that is one of the programs we do use to

reach kids in the rural councilties because when kids are at schools, we can get food to them to take home for the weekends. currently, we fund that program entirely with private donations so it's an entirely privately funded program. but in my mind, it's a great public/private partnership because we're leveraging those private dollars to help address an issue that we currently can't address with federal dollars. and so the answer is yes. i think if we could find a way to vfl -- find a new revenue source that would allow us to provide more backpacks that would certainly have a positive impact on our ability to reach those kids. >> thank you. dr. hassink, one of the areas of concern for me with food insecurity is also the general obesity that has occurred in children and the increase in diabetes type ii. and as you look at that, and as

we look at that going forward what more can be done to teach about healthy eating lifestyles and how to prevent things like diabetes type ii because they can be so debilitating. >> thank you. and certainly we as pediatricians are seeing the rise of type 2 diabetes in children. i think starting very early with early healthy infant nutrition and transition to solid foods and good feeding practices, healthy habits for families at home, to start out right is essential. many of the children who have severe problems in adolescence with their health have already by age 5 been -- have had obesity. so early intervention, that means a family education. stronger links with the health care system and food and

providing information about food programs. providing education. understanding what's available for those families in the community. i think would help get them off to a good start. in 2007 when we wrote the expert guidelines for obesity, we considered all children at risk for obesity in this country and we've trained physicians to do preventive counseling for everyone because of this problem. >> thank you very much. to the panel thank you for all of your work to try to help our children and our families. thank you, mr. chairman. >> thank you senator donlly. senator hoen? >> thank you mr. chairman. thanks to all of the witnesses. ms. jones, you mentioned in your testimony some of the difficulties of complying with the sodium standards and the whole grains requirement. what can we do to help in that regard? what do you think the solution is? >> sorry.

we just want to make sure that we don't go forward with target 2 for the sodium because right now we are -- we are able to get by. we're struggling but we're able to meet those requirements. but if we go on to target 2, that would mean we are serving therapeutic sodium level. there will be no flavor to the kids' food. i just received an e-mail from my director letting me know that the students surveys are back from parents and many of them say that their children are no longer eating with us because there's no taste to their food. that's a big concern and if we continue on i think that will be even a larger concern. >> so last year ien colluded a provision that actually kept the whole grains at 50% rather than having 100% of the whole grain or the grain products having to be whole grain enriched and now i've introduced legislation with

senator king, this was bipartisan legislation senator king from maine, that would both keep us at the lower sodium level but not go to the next target level and would continue the provision that 50% of the grain products have to be whole grain enriched. is that something that you think's workable and that your state would find workable and you feel other states would find workable? >> absolutely. >> okay. and then touch on for just a minute issues as far as the competitive requirements for the a la carte menu. we want to make sure that the school lunches are healthy and the kids are eating them. >> right. >> and then we also want, you know, you to be able to continue with the a la carte and i understand there's some issues in terms of what you can provide a la carte. >> right. right now we would like to be able to serve items on a la carte also on the reimbursable

meal because you have to look at each a la carte item. if it's on a meal you can compare it throughout the week and it's much more difficult to be able to get an item to serve on a la carte. so we would like to be able to do that. if we can serve it on a reimbursable meal, it should be healthy enough to serve a la carte. >> again. just some flexibility? >> flexibility absolutely. >> thank you. mr. goff you know i'm glad to hear of your successes in terms of implementing the program in west virginia. and certainly flexibility does not mean a role back of good nutrition standards. but it again, making sure that we have healthy meals and meals that kids will eat and that our schools are able to make their budgets. could you tell me how many of your schools have applied for an exemption from the 100% whole grain requirement? >> well, we did 100%, the whole grain rich requirement back in

2008. the only thing that's affected our schools and that was implemented across the board in all schools and schools aren't having a problem with it. the only thing that's really touched in west virginia is the -- as it relates to pasta and that's only because we have some schools that are having trouble getting the product. >> right. and that's the point. some cases whether it's speet or tortillas or pasta, i mean, when we talk about whole grain enriched, it is not just the food and so forth but all the other products hence some flexibility is helpful and that's why you know i've advanced the 50% whole grain enriched. you've had a number -- i have a number but you have quite a few schools that have applied for exemptions. wouldn't some flexibility be helpful to them here? >> well i can't speak for the schools. i think that when you're looking at granting waivers, my fear of

that would be that it would give industry a pause to come on board and make the products more available at a sooner time. we had lots of waiver requests when we were implementing some of our standards as it relates to professional standards or even competitive sales. and i think if you have a good standard that's in the child's best interest then you hold that standard. i certainly can't speak for a state like kentucky. but our participation in west virginia and our school meals is the highest it's ever been. our breakfast participation is starting to exceed that of lunch so i think in west virginia and we have cooperative purchasing groups that pool their efforts to get the product, i think we're on the right track there. >> but you -- so you don't feel there needs to be any tlexability, even though you have schools that have applied for exceptions?

>> i don't know the numbers of those schools. >> 22. >> 22 schools out of -- we have about 700. so certainly that's cause for a waiver until the product can become available but it's my understanding it was more related to pasta. >> i understand in some case it relates to pasta or tortillas or some of these other products. and i that makes sense if they're healthy and the kids will eat them. i'll wrap up here mr. chairman. but the current dietary requirements allow for some refined grains, as well. if we allow it in the guidelines for all americans why wouldn't some flexibility in that regard make sense for school kids, too? >> i understand. >> okay. thank you. thank you, mr. chairman. >> senator stabenow you had additional question? >> i do. thank you. i do. thank you again to all of you.

i guess i'm trying to put in perspective, you know, i realize we are making changes in the last five years and behavior's always hard to change, serving a process of moving in the direction of all of us of wanting to be more focused on health and wellness and we all know the benefits of that and we know change sometimes is hard and i have to say i have seen -- visited a lot of school districts, some very creative where you take the vegetable and you put green peppers and onion in the tacos and the kids don't know they're getting it and someone else says the government says you have to eat broccoli and a very different reaction depending on how things are, you know, are presented and we want to be in the creative process of that where we're sneaking it in and kids don't even know beans are a vegetable, right? but mr. goff i wanted to ask you about specifically the

exemptions for whole grains and my dear friend and i really mean that from north dakota has been very passionate about this but yet out of thousands of schools across the country we have had only 350 requests for waivers on whole grains and to put that in perspective, 350 requests across the country, there are 900 school districts in michigan alone. one request in north dakota. four requests in kansas. and so i'm wondering have you received very many requests at this point and, again, why would you believe your schools wouldn't be asking for the flexibility of the waiver that we put in place at this point? >> well i couldn't give you the number. we have received some requests. but it's my understanding in talking with the cooperative purchasing group that is comprise our state that the requests is for pastas. and it's because the product's not readily available for them

to purchase and it has something to do with that that particular product has trouble maintaining its consistency. so until more of that type product hits the markets, some of our schools were struggling with it. but as far as the whole grain rich requirement we have had that in place since 2008. students are very accepting now of what they call the brown bread. so i think it's a good standard. and i think we just need to wait for industry to come up to speed. >> i'm wondering also, there are differences between larger and smaller districts and some that have the community eligibility and as ms. jones was saying just larger districts where there are smaller number of student that is are qualified for free and reduced lunches and so on. again, in west virginia, how have you handled that with a larger district where there's a smaller number of children sort of the economics of that for

schools because i'm sure that is different. so have you -- how have you handled that in terms of districts where virtually all of the children are qualifying for free and reduced lunch versus a district where maybe less than 50%? >> as far as -- >> as far as the sort of the economics of the -- of funding and so on because that seems to be the -- one of the concerns is that -- >> community eligibility? >> large districts are losing money because there are fewer children being reimbursed on free and reduced lunch and other children aren't buying lunch. >> that's a great question and we anticipated those type of things before we implemented community eligibility. like i said the first year that they piloted that we weren't selected so we did our inversion called west virginia universal free meals and we knew that if

we just -- if we just selected nine districts or however many we did select and said like, said that you now can have breakfast and lunch at no charge. if we didn't change something, it was going to create a problem with their budgets so we worked in conjunction with our state legislature and we passed senate bill 663 called the west virginia feed to achieve act and what that did one of the provisions of that act, is it realigned breakfast with the instructional day. we were offering breakfast at the worst possible time as most schools do at the start-up of school when the bells arriving, the buses arriving late kids want to talk to their kids. we have a state law that it could not compete with the start-up of school. breakfast in the classroom, breakfast at first period or breakfast after the bell or some combination of that. and every school at every grade level and what it's done, that in conjunction with community

eligibility, our breakfast participation is starting to exceed that of lunch. financially speaking that's very good for the programs because the margin of profit if you look at the federal reimbursement versus the cost to produce a breakfast, the margin of profit on breakfast is higher than that on a lunch and it's the most important meal of the day and now we have the naysayers in the beginning that for example, the teachers that didn't want the food in the classrooms, will now go to bat for the program and are actually promoting the program because they can see such a huge difference in test scores, student attentiveness, reduced tardies, fewer trips to the school nurse. fewer behavioral problems. it's really changed the way our -- we're educating kids in west virginia. we have one school district that district wide mason county, their breakfast participation last year averaged

almost 90%. 90% of the children in that school ate had a breakfast on a daily basis and that's how we have tunnel it through the economies of scale the cost to produce one more breakfast or one additional breakfast is the cost is not that significant but the federal revenue coming in on that one more breakfast is substantial. >> thank you very much. i know my time is up mr. chairman, so thank you. >> excuse me. senator boozman. >> thank you, mr. chairman. i apologize for running back and forth today. there's -- this is such an important hearing and such an important topic for arkansas and the rest of the country. i'm on another subcommittee though, that also is very important and has to do with violent crime. gangs and things like that which, again, all of these things go together. and so like i say, i apologize for running back and forth. mr. riendeau again, i know that these things have been discussed already and things but it's such

an important thing for our arkansas. our summer meal participation increased in recent years and is very, very important. however, we struggle to reach children in rural areas. can you talk a little bit about the challenge that you have experienced with the meals program and then also based on your experience can you give us some concrete recommendations as to what we can do to overcome some of those challenges? >> sure. you know, as i said before we have dare to care serves both urban and rural counties and probably much like your rural counties, particularly in indiana, you know, the distance between the communities is so great and the communities are so small that it's just very, very difficult to find locations where kids can go and congregate. unlike our urban counties there

aren't robust boys & girls ss clubs and the challenge is how do we find a way to get these kids access to summer food based on the realities of the county in which they live? and, you know, so we have looked at several different options. one of the thoughts we have is we've looked at -- we actually have a bus. we have a school bus now and we're actually looking at the possibility of prepareing meals in our community kitchen, loading those in and putting them on the bus and taking them out to the rural counties and driving to the hollows where you will have a community of 20 families and dropping the meals off. and letting the kids consume them as the bus goes away and goes to the next community. the challenge with that model under the current rules is unless the kids -- unless we stop and the kids eat the meal on the bus an we count the

number of children we can't be reimbursed so the sustainability of that model is doubtful and that's kind of the challenge that we're facing which is why, you know, one of the things we'd like the committee to consider is allowing us to look at more flexible models in those counties like i'm sure in arkansas would probably benefit deeply from that. let us look at those and make those eligible for reimbursement, as well. >> mr. goff you mentioned that you'd started your program in 2009. and i think that's right. okay? and i think that you know, our states need the flexibility to do as they feel like is best. can you tell us, you know, based on 2009 to now what are your obesity levels or have they gone down or flattened out or continued to go up? do you have any challenge about that? >> in west virginia? >> yes, sir. >> we adopted those standards in 2008 and our --

>> what's happened as a result? >> i think our obesity rate has leveled off. i don't have the data. but i do know that our school environments are healthier. in west virginia, hunger and obesity live side by side. in trying to put the finger on the culprit we have done everything in our power to provide safe and healthy learning environments for our kids. >> i agree with that totally. the only reason i mention is that this does go together with a whole host of other things and we need to address this, you know and like i say i don't disagree you all are doing a great job in the sense of doing what you feel like is best for your kids. but it is -- i think one of the probables we run into is that, you know we feel like if we do this or that in this particular area we'll solve our problem and the reality is it -- with p.e. and you know, lots of other things after school

activities, all of that goes together and if we don't do it all then we're going to be in trouble. ms. jones, you mentioned in your testimony the importance of flexibility. can you talk to us a little bit about specifically the kind of flexibility that you'd like or maybe in some areas or two? >> sure. just like when we talk about our a la carte the fact that we had to take a healthy choice off like a sub sandwich with turkey and cheese. that doesn't make sense to me. that is a healthy item. we would like to have that flexibility to put those items back on the a la carte items. having the decision to be able to raise the price of a meal or not, i mean that should be determined by each district, by what they feel their enrollment would be able to pay for. we want to be able to keep those

kids into those cafeterias because we can't serve them nutritious meals if we don't have them eating with us. so those are the type of things we're wanting to look at. like i say with the fruit and vegetable, we really want to encourage our kids. that's something that we've always thought is important but we do not want to lose our unlimited froouts and vegetables because we can't afford to do that anymore. >> good. thank you. thank you, mr. chairman. >> dr. hassink i apologize that we have not paid more attention to you. especially with all of the work that you -- >> i would have if i had more time. >> thank you. >> but you made as a typical situation where a chairman of committee is answering the question that i would have asked you. you made some excellent points

with regards to a lack of specific nutrients at a specific time. and the detrimental affect that that's had on attention and development. short term memory. iq scores. everything that everybody strives for. but if they miss the boat, they miss the boat. i'm not asking you to expound upon that research. i think it is self evident but i want to let you know how much we appreciate your coming and your statement. i am now moving to the conclusion of our hearing this afternoon. yes, it is this afternoon. thank you to each of our witnesses and to the first panel, as well. for taking your time, your very valuable time to share your views that are related to the child nutrition programs. these testimonies that have been provided today are very valuable for the committee to hear firsthand and to keep on record.

your thoughts and insights will be especially helpful as we undergo the reauthorization process and to my fellow members i would ask that any additional questions that they may have for the record be submitted to the committee cleric five business dales from today or may 13th. the committee now stands adjourned. here's a look at some of our featured programs for this week.

saturday morning beginning at 10:00 eastern on c-span, live from greenville, south carolina for the gop freedom summit. speakers include scott walker ted cruz ben carson and florida senator marco rubio. sunday starting at noon eastern members of first families remember first ladies. featuring the daughters of jackie kennedy, lady bird johnson, betty ford and laura bush. on c-span2, saturday night at 10:00 eastern, on book tv's after words, jon krakauer on sexual assaults and sunday evening at 10:00 ann dunwoody. and on american history tv on c-span3, saturday afternoon at 4:45 eastern, an oral history remembering the liberation of nazi concentration camps with an

interview of kurt klein, lost his parents in auschwitz and as an interrogator for the u.s. army questioned hitler's personal driver and the end of world war ii in europe with commemorcommemoration of the event at the memorial in washington, d.c. get our complete schedule at c-span.org. at a senate hearing on rural health care, officials from the centers for medicare and medicaid services and local health providers discussed the challenges of rural hospitals. this senate appropriations subcommittee hearing is just under two hours. >> so the appropriations cub committee on labor, health and human services education related agencies will come to order. glad to have all of you this

morning. i want to thank the witnesses for appearing before the subcommittee today to discuss the unique health care needs that face rural communities. we have two panels this morning. members should know i expect to call up the second panel around 11:00 a.m. so we have adequate time to hear from both. and of course if for some reason we get done with this panel earlier than that, we'll go to the second panel quicker but no later than 11:00. we're glad that everybody has come today to help us talk about this issue. certainly one of the priorities of the commit tee and one of my priorities in congress has been to ensure that all americans have access to quality and affordable health care in their local communities regardless of where they live. the obstacles faced by rural health care patients and providers in rural communities are unique and often significantly different from those in urban areas.

albeit truman medical center in kansas city tomorrow and they have a different set of problems but they have some unique problems, too. and both our inner city hospitals and our rural hospitals have challenge that is are unique to them. in rural health care the issues can range from a lack of access to simple primary care physicians to difficulty finding specialists. as a result, many patients have to drive long distances to receive care or simply may not seek care until it's too late. this creates unnecessary disparities in health care not found in other can parts of the country and ultimately cost taxpayers more than if we had provided access in a better way. i think it's critically important that washington recognize that health care access is essential to the survival and success of rural countries across the country. i'm concerned some of the

proposals within the department's budget and recent regulations that have been issued that would affect rural health care and jeopardize health care access and in fact when you do that you really threaten the survival of small towns. the medicare payment system often fails to recognize the unique circumstances of rural or small hospitals and this administration has appeared in my view to target rural hospitals in particular. for example, the department once again has proposed to decrease the reimbursement rate for critical access hospitals and eliminate critical access hospitals within ten miles of any other hospital. the department has proposed that change for years. yet, just recently, been able to provide details to the congress about which hospitals would be eliminated if we look at that new mileage standard. the department has continuously issued regulations that would affect small and rural hospitals

more than their larger urban counter parts. cms is abrupt enforcement of the 96-hour condition of payment for critical access hospitals and the direct physician supervision rules and recovery audit contractor audits not only hinder the care of patients but medical staff time enresources to comply with those rules. finally, given the fact that the department requested $4.1 billion increase for the coming fiscal year it's even more surprising or maybe not so surprising that the office of rural health received a $20 million cut in the proposal that the administration issues the administration, in fact, has never once asked for an increase in rural health programs. more than 46 million americans live in rural areas and rely on rural hospitals and other providers as their lifeline to

care. they face ongoing challenges in assessing proper medical treatment while rural health care providers are overwhelmed with federal rules. certainly senator murray and i both have an interest in this. i look forward to working with her and the rest of the committee to ensure that all americans regardless of where they live have access to affordable health care. and senator murray. >> well thank you mr. chairman, for calling this hearing on such an important topic and i am very pleased to welcome all of our witnesses who are here today but i'm particularly excited to welcome julie peterson. hi. julie is the chief executive officer of pmh medical center in washington and through her work at pmh and the leadership and helping make sure that rural communities get the health care they need. so thank you for coming all the way out here testifying today. over the last few years we have taken historic steps forward when it comes to making our

health care system work better for our families but i believe strongly there is much more we can do to continue to improve affordability, access and quality and to keep building a hel care system that works for women, families and seniors and puts their needs first. in my home state of washington where about 1 out of every 5 residents lives in a rural area, a critical part of this work is making sure that families can find the doctors they need right in their own communities regardless of whether they prif in prasser of seattle and this is true in many other parts of the country, as well. this is a serious challenge. i've been focused on for a long time an i'm proud that washington state is doing so much to tackle it head on. washington state recently received a federal grant to explore the role of community paramedics in providing home follow-up care. this approach could reduce emergency visits and help patients avoid the inconvenience of leaving home to get care.

i also hear repeatedly of number of new patients getting coverage through the affordable care act across my state. for example, a network of four rural health clinics reported a 43% increase in patients last year. that's great news but it also means we need to think carefully about how to make sure there are enough doctors and other health care providers to treat all of the patients. so i'm glad to have the opportunity today to talk about the investments we need to make if we need to -- so we can build on that progress. the agreement the president recently signed into law to fix the broken sgr system took important steps to access to rural areas. including funding for health centers and each of which play a critical role of expanding access to primary care for struggling families, especially in our rural areas. sgr legislation also extended funding for teaching health center residencies. my home state of washington was a leader in sething up these training programs and now

primary care providers are being trained in communities with a shortage of health care providers from spokane to yak ma. we know that training in rural areas is critical to keeping providers with an interest in rural practice in our high need communities. i'm pleased we're able to agree to sustain those investments and hope we'll be able to be able to do more moving forward and pleased that the president's budget maintains investments in other key programs that do support rural health. the 3040-b drug program is drugs to providers at lower costs. 26 out of my state's 39 critical access hospitals which provide crucial support to to rural communities participate in that program. similarly, the budget continues to support enhanced payment for rural health clinics and community health centers. in my home state and many others, these facilities help

make sure that when, for example, a parent needs to take a sick child to the doctor or a senior needs follow-up care it's easier to get the treatment they need in their own community so we need to make sure they have the resources that they need. i do also want to express concern that the budget proposes to cut the rural hospital flexibility program. that program's helped sustain and improve hospitals in the most difficult to reach communities including ten hospitals in my home state. i believe we absolutely need to see continued strong support for this investment in the health and safety of families in rural communities. finally i know rural health access is a priority. all of us here care about so i want to note that the president's sbugt able to sustain those investments along with supporting other key priorities from education to infrastructure to defense because it responsibly replaces the harmful cuts of sequestration that are now set to kick back in.

i'm proud last congress republicans and democrats were able to come together to reach agreement that rolled back sequestration for fiscals years 2014 and '15. with the deal set to expire, i hope we can build on that foundation and prevent these harmful cuts to investments in families and jobs in our economy including critical support for our rural health care. i look forward to working with all of our colleagues on this in the coming weeks and months and again i want to thank all of our witnesses for being here. mr. chairman, again thank you for holding this really important hearing. that is topic that means a lot to the people in my state. >> thank you, senator murray. we have two witnesses on the first panel. shawn cavanaugh, centers for medicare and medicaid services and tom morris, associate administrator for the federal office of rural health policy health resources and services administration. we're pleased you're both here and we'll listen to your opening statements.

>> okay. mr. chairman members of the committee, i want to thank you for the opportunity to testify today on behalf of the health resources and federal office of topic of rural health. i'm pleased to discuss not only the challenges you have already outlined but the accomplishments of our programs. across the department of health and human vftss very a range of programs and resources that support rural communities. in 2014 this included $11 billion in grant funding to rural communities. my office is the focal point with a continual focus on improving access to care. today there are nearly 15 million people living in rural areas, that's about 15% of the population. spread across 80% of the land mass in the united states. individuals in rural communities, often have to travel further for their care, and this can have an impact on their outcomes. new research shows that over the past 20 years life expectancy in rural areas is lower than urban and that gap is widening.

hersa improves access through a variety of initiatives includes supporting rural health centers building a strong health care work force and expanding the use of tele health. the office has several niche tifrs to focus on capacity building. we fund the state offices and that ensures there's a focal point for rural health within each of the 50 states. the flexibility grant program and the small hospital improvement grant program work with small rural hospitals on quality improvement and stabilizing finances. her hersa supports start-up funding for rural communities. community health centers are a component of the delivery system with affordable and efficient care in underserved communities. hersa has nearly 1,300 health centers supported national with 90,000 service sides and about

50% of the service sites serve rural communities. hersa announced 164 new access point grants for new community health centers. totallying $45 million in investments to go to improve access to care. hersa held training programs and worked to increase health care access by ensuring providers. the national service corps supports loan repayment and scholarships for primary care providers with almost half of those providers we support located in rural communities. and in an fy-2014 students supported by hersa went to 11,000 training sites and invest in training and work with 34 rural training tracks around the country. t ele health is an important role of enhancing the work force and expanding the reach. hersa is funding projects in 230 rural and underserved communities and 48 different

clinical areas and mental health. we have seen them pilot new initiatives. we also have 14 resource centers around the country that provide free technical assistance to communities to get started in tele health or advance what they're doing. rural communities benefited from the white house rural council. the council's focused on getting federal agencies and departments to work together to coordinate and serve rural communities better. i know in our case this has will led to ongoing partnerships of my office the u.s. department of agriculture and the department of veteran affairs on a number of health projects and we have expanded the national service corps to critical access hospitals. i want to thank you for the opportunity to be here and thank you for your support of hearsesa programs and i look forward to answering any questions you might have. >> chairman blunt ranking member murray and members of the subcommittee, thank you for the invitation to discuss the center

for medicare and medicaid efforts to preserve access to quality health care in rural areas. providing high quality care presents unique challenges. rural areas often have fewer hospitals and physicians and beneficiaryies reside a significant distance from the nearest provider. beneficiaryies represent a higher percentage making the organizations particularly sensitive to changes in medicare payment policy. at cms we have taken steps to improve service. we have numerous opportunities for stakeholders to engage to make sure we understand their concerns and challenges. cms has rural health coordinators who meet monthly with central office staff and representatives from the hersa office of rural health policy to discuss emerging issues and regular rural health open door forums for programs and learn

about issues. we're also trying to remove regulatory barriers for rural health providers. last year cms reformed regulations we identified as unnecessary, obsolete or excessively burdensome. which will save providers nearly 3.2 billion over 5 years. this rule included specific provisions to reduce burdens. for example, a key provision reduces the burden on critical access hospitals, rural health clinics and fqhcs. this provision recognizes improves for lower cost maintaining high quality care. we're also expanding access to rural care through technologies. medicare's benefit allow services normally requiring a patient and practitioner in the same location delivered by interactive system.

a variety of practitioners are authorized. the statute requires that medicare pay for professional consultations, office visits and psychiatristsighpsychiatry services. cms solicits public comments on additional services that should be billable under the tele health benefit. for 2015 we have added the annual wellness visit, family psychotherapy and prolonged e and m services. we're also exploring how to improve the current benefit. the centers for medicaid and medicare innovation is testing pilot services to communities. for example, the health care innovation awards initiative awarded a grant to health link now and pairing aspects of medicine with navigators and specialists to serve patients with chronical conditions in frontier communities in wyoming,

montana and washington state. also, this year we announced the next generation model that will be -- is currently accepting applications to begin next year and that model will be testing expanded use of t ele health services, as well. critical access hospitals are small facilities that serve communities that might otherwise lack care. medicare reimburses cause at 101% of the reasonable cost. there are currently more than 1,300 in the united states. here i would pause and just thank congress also for expanding the medicare dependent hospital legislation. the rural health clinic program helps us expand serving medicare patients in rural areas, approximately 4,000 rhcs nationwide with access to primary care services in rural areas. and finally, the innovation center is uniquely positioned to test and evaluate new models for

quality care for rural communities. for example, testing two models designed to support acos in rural areas. the advance payment model is meant to help entities such as smaller practices and providers with less access to capital and help them get into the medicare shared program and the aco investment mod sell a new model of prepaid shared service to advance payment model to encourage them to form in rural and underserved areas. cms recognizes the challenges faced by providers in rural areas. i look forward to continuing to work with hersa and the congress on further improvements for quality care regardless of their location. thank you again and i'm happy to answer your questions. >> thank you both. let me ask you a couple of questions and then we'll do five-minute rounds here. on, mr. morris, the department, the budget, the administration submitted would have cut your

budget by $20 million. did you ask for that cut? >> mr. chairman, we support the president's budget and the request that came forward. we think it supports the key programs for our office. it includes flexibility programming, for our policy and research activities. and we think that those are the programs that can be most effective in meeting the needs. >> so where are you going to spend $20 million less than you are spending this year? >> the president's budget does have -- there is that decrease, yes, sir. >> what programs are you going to decrease? >> there's no question for the funding of the small hospital improvement program and there's no request for the funding of the rural access to emergency devices program. in the case of these programs and the administration's request, these are challenging budget times. and they require some tough choices sometimes so i think the

president's budget reflects a request that for the programs that we think are think are really effective in meeting the need. in the case of the small hospital improvement program, we have the rural hospital flexibility program and there is a $25 million request for that program. that program focuses on what we see is the most vulnerable of the rural hospitals sector, which are the critical access hospitals. so there will be $25 million requested to support quality improvement and partnering with the states and those states. in the case of the rural access to emergency devices program this is a program that places automatic external defibrillators in rural communities. we think that the need has largely been met in that program. not only through federal funding, but also through state and private sector funding. but we do allow people to come in through our outreach funding to get at that same issue. so an applicant could come in for outreach fund organize network funding under the program that is requested in the budget and do the same thing as

the aad program and since that they could develop a program that seeks to purchase those defibrillators and put them in rural communities. so for the remaining need that is out there we feel it can be met through outreach program. >> and the hospital improvement program that you would continue is a $25 million program? >> yes, sir the flex -- >> in the current year you're spending 25 and proposing to spend another 25 next year? >> correct. >> and then the 20 that you would have this year for similar purposes would go away in the president's budget? >> yes, sir. the ship program, small hospital improvement program, there is no request for that. it had been funded historically at $15 million. and the other 5 million is from the access to rural emergencies devices program. >> what obstacles do you see in telehealth? we have people telling us that there is still issues that they're trying to work through with your department on telehealth. what would you say would be the

top obstacles to move forward and telehealth? >> well, one of the issues we're trying to get at for telehealth is the whole issue of cross-state licensure. providing services in another state. so the congress has provided funding through our telehealth programs for the licensure and teleportability program. we with the state and provincial psychology boards. we're trying to work with licensing boards so that say a psychologist was practicing in missouri but was providing services in another state, rather than having to complete two completely different licensure applications, they could adopt a common licensure. so it makes it easier for somebody to practice across those state lines but it still protects patient safety this terms of the licensing and credentialing for that provider. that's one way we're trying to get at it. we've been investing in telehealth for a number of years. i think we now have improved access to care. i think one of the challenges is

finding out which applications have the best clinical outcomes. so the evidence base for telehealth could be expanded. so one of the things we did this past year is put money into a teleemergency evidence-based program. and what we're trying to understand is how does the outcomes from using teleemergency care compare to when you got those services face-to-face. i think that's a question any insurer would want to know about. and i think the more we can learn about the evidence base and what works best in telehealth i think can then help us target investments moving forward. >> we may move forward with that a little bit even in our telehealth panel there. senator murray? >> i'm a strong supporter of hirsh's workforce training programs. in particular the national health service core provides critical support to physicians and other providers that agree to work in our rural and underserved areas. and i also just want to recognize your agency's important role in documenting workforce shortages through the

national center for health workforce analysis. and i wanted to ask you what are the current projections -- what do the current projections say about our national health care workforce shortage? >> sure. demand is expected to increase for primary care services through 2020. and that is due to the fact that the population is aging, and the population is growing. and then there are also impacts that you referenced earlier in terms of more folks having coverage may result so the national center has done some projection work. and what they're projecting is there will be a shortage. this is mitigated by if we were able to take advantage of the supply of nurse practitioners in and pas and use them to the full extent of their training. if that really happened and the mp training and deployment and same thing for physician assistants, if that happen, i think the shortage drops down to about 6,000. >> so what are kind of health

care providers are most needed in our rural communities? >> i think the full spectrum of providers, primary care. we see shortages in mental health and that's for everything from licensed clinical social workers to psychologists. psychiatry is not a service you often find in rural communities. but even some rural communities even have challenges in terms of the allied health workforce and regular nursing. so those are all challenges i think that rural communities face. >> talk to me about how the additional resources that you requested for the national health service core and the budget help address shortages like we have in rural washington. >> well, the administration's request would dramatically increase the funding for the national service core. and the advantage of that is right now we fund national service core loner payment scholarship down to the level of funding that is available based

on -- how how underserved they are. basically what their score is in the health professional shortage. so the more funding that is available and the funding that is in the president's budget would allow us to fund more clinicians to be supported in those communities. and that would mean a lower hip is a score which means more rural communities would have access to it. it's been a lifeline for rural communities. as i noted before 50% of the placements, just under 50% of the placements for the national service core go to rural communities, even while rural only represents about 17% of the population. >> okay. how can we continue to leverage the teaching health centers program to make sure that residents say in rural areas? is there anything we can learn from this program to attract other specialists? talk to me about that. >> well i think one of the big lessons from the teaching health center program is that you can do residency training in a community-based setting. so much of our residency training takes place in large academic health centers.

>> yes. >> and if we can get more folks exposed to community-based training, the hope is that they'll be interested in that community-based training. so we'll see them working in our rural health clinics and our community health centers and our small hospitals. i think the teaching health center shows the path forward. and i think that informed the president's request around really reshaping how we train physicians and creating a new grant program to do community-based training. and that would include rural communities. we know also from some of the work we do with the rural training tracks, which started in your stale in colville, washington, this is a unique model where they do one year in an academic health center and two years in a rural setting. 70% of the graduates end up practicing in rural communities. i think the evidence is strong that if we do more community-based training, we'll meet the needs better. the teaching health centers are a first step towards it and i think the president's request is another step toward that. >> yeah, i completely agree. i've seen this working in my state. where you practice and do your residency really makes a difference on where you stay.

and when we have such a need in our rural community, having those residents in those rural communities, doing their residency, it works really well. so i hope we can continue to build on that. and i thank you. >> senator cochran? >> mr. chairman thank you for convening this hearing on the challenges that we're facing in our rural communities throughout america in making available health care services, some of which are partially paid for by federal government agencies. and we hope to learn from this hearing ways to provide the needed resources up to the point where we are authorized to do so. it's been brought to my attention that the health resources and services administration has released a grant notice regarding the intent to provide funding for a telehealth focused research center cooperative agreement.

could you tell us more what that is and what are you looking for in an applicant and what are the goals that would be funded by this cooperative agreement? >> yeah, i think this builds on the comment i made earlier that again, i think we know telehealth improves access. and i think the real challenge is finding out what the impact of that increased access is. what we're hoping to do with this research center is to help build the evidence base for finding out which applications work best and deliver the best outcomes. and so what we're looking for are experienced researchers who can do comparative outcome research. so we can look at you provide a telehealth service and here is the outcome. how does that compare to whether you had it face-to-face. i think that will really inform the evidence base. >> are you encouraged by the results of your applications and those who are petitioning the government to choose them? >> we've gotten a lot of calls on this funding opportunity, just in the week it's been out there.

>> mr. cavanaugh, i understand the centers for medicaid and medicare services restrict reimbursement for telehealth based on geographic locations. how do you administer that? how do you choose which urban areas, for example, are more eligible than others for telehealth reimbursement? >> thank you for the question senator. in this statute, it gives us instruction to allow telehealth to be provided in certain geographic areas. pleased that with help from our colleagues at the office of rural health policy a few years ago, we changed our regs to expand the definition of rural areas that qualify. but the geographic restrictions really originate in the statute. the good news is through the innovation center which congress created we're able to move beyond those barriers and test new models of telehealth without regard to the geographic barriers and some of the other

statutory restrictions. we have a number of very interesting telehealth models that are being tested currently including the health link model i mentioned in my testimony. >> thank you very much. >> senator moran? >> mr. chairman, thank you very much. thank you for you and senator murray having this hearing. a very important one certainly from a senator from kansas. but really for the country. let me start with mr. morris. tell me what statistics are there that demonstrate over a period of time how many rural hospitals are closing or being -- in addition to that are threatened to close. i've seen an ap story just in the last few days indicating that 50 rural hospitals have closed that expectations for more -- a total of 50 hospitals in the rural u.s. have closed

since 2010 according to the ap. and the pace has been accelerating with more closures in the past two years than the past ten. this is according to the national rural health association. i've also seen the study from the north carolina research agency, organization indicating 47 i think is the number of hospitals that have closed. my question is do you consider those numbers accurate? and what kind of study analysis do you have about cause? what are the -- what can we pinpoint the cause for those closures? and what is your expectation for that trend in the future? >> yeah, mr. moran, thank you for that question. this is an issue we've been tracking, and those numbers align with what we've found in our and we're working with the university of north carolina. they're one of our rural health research centers. and their work is very solid. you know i think that we're trying to get a better handle on

what is driving the closures. i don't think that there is one single factor behind it. i think what is it's very community specific sort of issue. in some cases, it may be that the community has lost population and may not have the volume to support a full service hospital. but there are also a variety of other market pressures that may be having an impact on it. it's certainly something that we're going to continue to study further, and the university of north carolina center will probably lead those efforts. we'll be happy to share with you all those findings. they are looking at a study that we hope to have out next year that looks at what happens in a community after a hospital lowses. just doing some informal calling around to get a handle on this. in some communities the hospitals close and we see a situation where another provider can step in and still provide a broad range of ancillary was services. maybe they have expanded their telehealth. maybe they expanded the clinic

hours so they're not just open 9:00 to 5:00. and the community seems okay. in other cases there is a definite gap when a hospital closes, specifically around emergency services. but with the 34 hospitals that have closed since 2013, that is an uptick from the previous two years. what is interesting is the same number of hospitals have closed in urban areas, but i think as you know, when a hospital closes in a rural area it's a little different than when it closes in an urban area. so this is going to be a real priority for us from a research perspective over the next couple years. and we'll certainly work with our colleagues at cns and across the department to better understand and see what other resources can be brought to bear. >> mr. morris i'd be interested in knowing the research outcome of what happens to a community following a hospital closure, but i also would encourage for that research or -- for research to be conducted that would indicate what steps could we have taken to have prevented the closure in the first place. i'm pretty certain in most

instances the research will demonstrate significant consequences, often pretty dire to a community and to patients. i think that we ought to be more prospective is how do we avoid this? what are the precipitating causes. i agree with you it's not one thing. population and demographics is something maybe we can't control here. but certainly the regulatory environment, the cost structure is important to those hospitals. physician and other health care provider recruitment retention. and then the reimbursement rate. and on that topic, i wanted to ask you about the idea of cost-based reimbursement. what is the evidence that when we say we're reimbursing costs at 101% of costs that that has any real meaning in the real world? i mean, isn't the reality that when we say we are reimbursing more than costs, we only reimburse -- not all costs are reimburstable.

we create this impression that a hospital is getting more than what it costs them to operate. is there analysis? can you quantify really what is going on in a hospital when we tell them or when we tell the public that your hospital is getting 101% of costs when it's really reimbursable costs? >> yeah, that is a -- as you know, that's a very complicated question. you know it goes back to the historical costs of the hospital and if they converted to critical access, what those historical costs feed into, what they would be paid under the ch reimbursement status. so it does vary from state to state. but i would be happy to get back with you and also with your staff. we can connect you with some of the folks at the university of north carolina as well some of our experts to better understand it. >> in today's setting -- i would welcome that. in today's setting, can you confirm for the record that when we talk about reimbursing a hospital, their costs that they are receiving something significantly less than actual cost of operating the hospital? >> i think in some cases that may be true. it's hard to say that

nationally, because it's different depending on the historical cost structure to the hospital. you know it might be different for kansas than it is for alabama and, you know as you know hospital structures are cost it's a science on to itself. so i'm happy to get back to you on more of that. i would also just to respond to your earlier question, we are trying to do what we can to avoid closures. and i think we've done with the investments in the flex program, we're really focusing on making sure that hospitals -- ch is not required to report that quality data to medicare but we encourage them to do. so we've seen a significant increases in the numbers of chs reporting their quality. if they can do and they can benchmark their quality, they can demonstrate more value back to their community. we also led a contract last year to work with rural hospitals that are struggling in high poverty counties. so we have an example in tallahassee, mississippi. mr. cochran's state, where we're able to send consultants in there to help them turn around their finances and improve their

financial bottom line. so within the resources we have in there we're keenly aware of the precarious nature of some rural hospitals and whether it's our flex program or that contract, or even our outreach and network fund we can begin to get at it. we're doing all we can to help stabilize folks so we're not in a closure situation. >> i can tell you that very few hospitals in kansas who receive quote, cost-based reimbursement are able to survive in the absence of a tax levee to support the hospital. >> yes, sir. >> thank you, mr. chairman. >> thank you, senator moran. senator capito? >> thank you, mr. chairman. and i want to thank the panel. and i'm from the state of west virginia. so i'd like to ask a question to mr. cavanaugh on -- in your testimony, you talked about the new initiative health link now which is pairing telemedicine and telepsychiatry. this program is currently being tried in three states.

i was wondering what measurable data the pilot program is showing you, and what are the prospects of expanding this to other rural communities? as we know, there is a shortage of mental health professionals everywhere, and rural america is probably exponentially so. >> you're correct senator. before i was at the center for medicare, i was at the center for medicare and medicaid innovation. when we did the innovation awards, there were quite a few telehealth and telemedicine proposals. and i was surprised at the number that had a link to behavioral health and psychiatry, just as you mentioned. we have some early evaluations of those but they're very qualitative, meaning in case studies of how they have fared in standing up the program. we hope in the next year to have some quantitative data. i'll remind the committee, the statute set up the innovation center and said these models can be tested and they can be expanded if they meet certain cost savings and/or quality improvement standards. so we intensively evaluate all these models. so we hope in the next year to

have some more quantitative results. one of the things i would say is many of the innovation center models are being tested at very large scale. some of them are being tested at smaller scale. and this would be one that is at smaller scale. even the we get very promising data, i don't think the next step would be to go to national with it. it would be to incrementally move to more communities. we're hope to feel have data soon. we have made all our valuations public and we will certainly share wit this committee as soon as we have news. >> well, thank you. i think one of the obstacles that all of us who live in rural states that are combatting every day is the lack of high speed rural broad band access. and certainly that's got to be impacting telehealth into the rural health initiatives. are you running into this in some of your telemedicine initiatives? is this a problem that you've identified as well, or you have anything on that? >> again certainly anecdotally as we talk to some of our wardees.

what communities they think they can test these models in and which communities they wish they could test these models in. we don't feel we at medicare have the tools to help with that but we do recognize it as a barrier. and it's important, because i do think whether it's telehealth or other technology i think telemedicine technologies, i do think broad band is going to be essential to that. >> and it's a challenge. it's a challenge. you know anecdotally recently, mr. morris, in talk with our hospitals and emergency room physicians, we're talking with the anesthesiologist the other day, one of the things that is cropping up now is that lack of total number of residencies so that there are several hundreds. i've heard 500, and then maybe into a thousand graduates of medical schools who don't match and they don't get a residency. and that obviously stalls out their professional career. they've got student loans. and all sorts of other issues. are you looking at -- i mean i think we should be looking at rural health as a way to expand

the availability of ready sis to fill this gap. do you have any -- i know you talked a little bit about residencies in your opening statement. >> yeah. wet are -- we do recognize the challenge you have just laid out. and one of the things we initiated about five years ago was to put a grant together with the national rural health association to expand these rural training tracts. there were about 23 of these across the country. and that number had been fairly static over the years. and now they're about 34. so we have increased the number of rural training tracks. what is unique about the rural training tracts. although is a total cap on the number of residencies that can be supported, there is flexibility under the cap for new rural training tracks there is an opportunity to create rural residencies and to work with our partners at cms through that flexibility under the residency cap. and again, we know this is an evidence-based model that works. and we've seen some real successes from it. >> i certainly would be very

supportive of any kind of way to meet -- to solve. this could help solve more than just one problem here if we were able to expand that and use it wisely. and i'll just make a comment at the end. those of us who live in rural america are always frustrated that it's assumed by the more urban areas that it's cheaper to deliver medical services in a rural area because typically, wages are maybe a little bit lower. but you have workforce shortages. you have travel times. you have all kinds of other issues that it's frustrating for us i think to make the case. i mean, we're always having to make the case, as you know. you're in this too. and so i applaud your efforts in helping us deliver the message to all of the health care dollars need to be allocated -- it's not as easy in rural america as some in the urban areas might think it is. thank you. >> dr. cassidy? >> hey, gentlemen.

i was looking down but listening. so one of you pointed out the cause for closure is multifactoral. i accept that. i'm curious. it seems like the only business model that is actually going to work in a rural setting is is volume. you don't have the critical mass of patients partly because so many are uninsured and partly because your pay makes medicaid so poor. i say this because we just passed an sgr bill which promoted alternative payment models, the organization all rely on value purchases with the implication that volume decreases. so is one of the factors in this multifactorial problem that the business model can only survive with big volumes and the push is away from volume and more towards quality? have you run molds on this? i'm wondering if there is any hope for these hospitals out besides an outright subsidy, be it through a tax base or be it through some federal legislation.

>> i think, senator, you're putting your finger on a very important challenge that we all face as we move forward, which is, as you say, how do rural health providers not just survive but thrive into the new setup of the sgr reform bill. i think there is multiple ways this can happen. one is -- >> but let me ask before you go forward, because i have a specific question. >> sure. >> do you have studies showing the effect of say an accountable coorganization which needs a critical mass of people with a very good pair mex on a capitated basis receiving their preponderance of care at this institution? is there such a study looking as to whether or not this model will work for rural hospitals? >> so i'm not aware of any studies. we are pleased to say, though, there has been a lot of skepticism whether acos could work in rural areas. in the shared savings program, which i'm responsible for we do

have 15 -- so we have about 7.3 medicare fee for service medical beneficiaries aligned with acos. about 15% are living in rural america. >> let me ask, though. you can live in rural america but still get your health care at guysinger. so it wouldn't be that you had a local hospital. it would be that you're linked with a urban hospital or semi urban. you know, something such as that. so are these in the rural hospitals, what is the health of the rural hospitals and those settings in which you just described? those acos you just described. >> so you make a good point. i would remind you though, the beneficiaries are aligned through their use of primary care, not necessarily where they get their primary care. >> preponderance of primary care. you can live in a rural area and be in an aco that has a significant urban presence because there are acos that span both times of communities. and there are those that are strictly in rural areas there is

one called a national rural aco which is combining rural acos across the country. i think it's early for us to know what the relative success of rural versus urban acos. >> i'm sorry. and i have limited time. so i'm trying to focus. what is the health of the rural hospitals in those areas in which there is an aco which governs, which has responsibility, if you will, for the rural patient? because i'm really -- this is about hospitals. so the we have an aco which kind of aggregates the care into an urban hospital setting that would actually be starving the rural hospital. >> i don't have the data that you're requesting. we can certainly go back and see if it's something we can compile for you. >> okay. okay. continue, then. because that was kind of the point you. had another point. i'm sorry i interrupted. so continue. >> i just want to make the broader point, senator, that we have heard from a lot of rural providers that they are excited

about the prospects of getting into new payment models because they do find fee for service payments frustrating. they think they're efficient providers in many cases, probably are. we do have one large initiative out of the innovation center called transforming clinical practice. and this is where we're going to help small practices. not the hospitals necessarily, but small physician practices. give them technical assistance so they can develop the infrastructure and the knowledge to -- >> in that, i'll just go back to this. because it's -- the hub is what matters here. if the hub is a rural hospital and that could potentially help, although under value-based purchasing, you're still going to be emphasising keeping people out of the hospital. and i don't see -- you tell me. is there a business model that works for a small rural hospital that is not volume-based? i can see it working for the primary care providers. but i don't see one working for a rural hospital. >> if you're looking for that our best hope is probably the

accountable care organization with the aco being a primary player in that. and as i mentioned in my testimony, we've got two different programs to help rural hospitals. we provide them seed capital to help them form an aco and get into the shared savings program. it's very early both in the aco program and in these models that we're running. >> i'm sorry. so in that model what is the -- i'm sorry. i'm going a little bit long. can i have it? what is the minimum number of patients you would need in order for that rural aco to work? >> so the aco -- it doesn't change the minimum number in the basic program, which is 5,000 alined medicare patients. >> now that would be for primary care provider. but 5,000 patients would not support a rural hospital with a ct scan and o.r., et cetera. the minimum number required to maintain a certain x number of hospital beds? >> i'm sorry. i should have been clear. 5,000 is the minimum to get into the aco program, the shared savings program. you're asking from an actuarial

standpoint do we have some sense of what aligned lives would be needed. i don't know the answer. >> i tell you, we cannot make wise decisions regarding public policy unless you have those numbers. because ultimately, they got to make money. and unless you can give us some data that this there is a business model that works on an alternative payment model, we're wasting our time. and i say that not to scold. i'm swaying have to make decision. we would ask y'all to come back with that, if i can ask the indulgence of my chair and ranking member. i yield back. thank you. >> thank you senator. anybody have a follow-up question? we maybe have time for one or two other questions if anybody has one. mr. morris in response to senator moran's question you believe there are states that reimburse the total cost of a critical access hospital's operation? >> no, sir. what i was saying is that because -- and sean can correct me if i get any of this wrong. you know when you set the cost

based reimbursement rate, it's based on historical costs. and we just see some fluctuations from state to state in what that initial base is. but it's more complicated than that. and i can get back to you with more information on it. >> i think we expect you to get back to us on that. >> okay. >> but i think the point is well made that these rural hospitals are not in the profit-making business even if they get 100% -- 101% of the allowable reimbursement. but there are states that have a formula that allows that we'll be anxious to see which states are doing that and how they figured out how to calculate everything that is spent by the hospital to operate into their cost basis. >> and to respond to mr. cassidy's question too, i would say that we do have examples of hospitals even with low volumes that have been able to make it work. i think it really is situationally dependent. there is a base level of volume you need. i agree with that.

but we've got some success stories out there where folks have been able to bring primary care and align the physicians and the hospitals in a way figure out what lines of service they can get into that makes sense for that community, arrange relationships with upstream providers that make it work. so what we would like to do is use our funding to sort of be the connecting of the dots between that identify those models, and maybe replicate them in other communities. >> all right. mr. cavanaugh? yes, go ahead. >> thank you, mr. chairman, and thank you for helping me ask my question, and i appreciate the answer. this is a home health care question. some of our hospitals more -- fewer than used to provide home health care services because they can't afford to. but the affordable care act includes a provision that requires medicare beneficiaries to have a face-to-face encounter with a physician who certifies the need for that home health care services. the implementation of this face-to-face requirement raises lots of concerns with home health care provider, hospital-based or otherwise.

and the documentation that is necessary, it sure seems to the providers as unclear. and the backlog of audits is increasing. there is a real uncertainty as to what the cms standard is for providing satisfactory face-to-face encounter. most of the appeals have been overturned in favor of the home health care provider. but my question is do you see this as a problem? does cms have a plan to respond to clear up the confusion provide certainty and reduce the backlog? >> yes, senator. i think you have put your finger on a challenge that we've been taking on head-on. the first thing is in rule making last year, we simplified -- you're correct that the affordable care act created the face-to-face standard. our initial rule making in addition required a narrative from the physician, a narrative writing, which providers found ambiguous. so we withdrew that requirement. so we still have the

face-to-face requirement, but not the requirement for a narrative description of the need. we continue to have dialogue with the home health industry to make sure they understand what we're looking for. we are exploring afters -- personally, i'm very interested in finding a way to facilitate people making the documentation. as you say, there are a lot of auditor reviews to these. some get overturned, but many are upheld. even when they're upheld it's often about the documentation and not about whether the service was needed, whether it was provided. i mean, granted there is fraud. but i'm not talking about that. i'm talking about a lot of services that were truly needed truly provided but poorly documented. and i'm trying to find fought there is anything the agency, any role we can play to facilitate that without facilitating bad behavior by a subset of the industry. >> thank you for that answer. i appreciate your attitude and approach toward attempting to solve this. and it is finding that place in which you don't punish those who are doing the right thing. and you do punish or prevent those who do bad things. mr. chairman, thank you.

>> thank you and thank you to the panel. i'm sure we'll have some questions submitted in writing as well. i appreciate your time today. and now we'll move to the second panel. and as the second panel is coming up, that panel includes tim walters the director of reimbursement at citizens memorial hospital in bolivar, missouri. and he is also a reimbursement specialist at the lake regional health system at osage beach, missouri. dr. christy henderson, chief telehealth and innovation officer at university of mississippi medical center in jackson, mississippi. ms. julie peterson the cmo of pmh medical center in prosser washington. and mr. george stover the ceo of rice county hospital district in lyon, kansas.

>> so thank you all for being here. mr. walters, if you want to start with your testimony, we'll go right down the line, then. >> thank you, chairman blanche, member murray first the chance to discuss current challenges. again, i'm tim walters. i oversee government reimbursement programs in bolivar, missouri and osage beach missouri. 50 rural hospitals have closed since january 2010. rural hospital closure means more than just the loss of access to health care for a community. as a rural hospital is frequently the largest employer in town, its closure represents an economic blow as well. my written testimony provides several examples of what is working in rural hospitals, including quality health care at a reasonable price to the medicare program and programs like the medical home program which improves the health in our communities. i want to focus my oral comments though, on four specific challenges rural hospitals face. first, patient volumes are lower

at rural hospitals and also flauk wait significantly on a day-to-day basis making it difficult to manage staffing levels. my written testimony has a graph on page three that shows the daily census at lake regional for the month of january showing significant daily fluctuations including a high census of 103 patients on january 15th and a low of 66 patients on january 25th. a significant fluctuation. second, medicalization is significantly higher at rural hospitals than urban hospitals. page 4 shows urban hospitals average only 30% utilization compared to 42.5% at rural hospitals. the challenge of such high medicalization is medicare cuts represent a higher% of our budget. and we have less commercial and managed care volume to subsidize the medicare losses. the third challenge is the cumulative impact of medicare cuts. the graph on page 5 compares estimates using cms data of hospital costs versus payments

from 2011 through 2023. the pop-top line represents the costs and bottom line payments factoring in productivity and fixed cuts under the affordable care act and the sequestration cut under the budget control act. the difference between the lines represents medicare's lost repeat burmts and it grows annually exceeding 17% by 2023. the cumulative impact of these cuts over this time period from my two hospitals is estimated to be about $120 million. beyond all of the cuts we've been facing, recovery of a contractor or rac program is draining our resources. lake regional currently has over 500 medicare claims worth about $3.5 million in medicare reimbursement. the final challenge we face is the increasingly complex regulatory environment in which we operate.

page 7 shows six different medicare perspective payment systems and six different medicare fee schedules we must manage with each of these systems changing on a regular basis, including changes to the midnight rule that ms implemented in 2013. also, we understand the reason for the change to icd-10 this fall, and we've been training extensively for the conversion. but this is one more significant change in our operations that we must implement with scarce funds available. both my hospitals were early adopters of electronic health records and have achieved stage 2 status. however, meaningful use funding nearing an end and the requirements continuing to increase this is also become an administrative burden for us to keep up with the changes that cms implements. in conclusion with 50 rural hospitals closing since january 2010 congress must act to prevent further erosion of health care in rural communities. we appreciate congressional action to protect the funding we receive. for example hr-2 eliminates the annual threat of a significant

reduction in the medicare fee schedule. it also provides a 30-month extension in the medicare low volume and medicare-dent programs and extends the home health care add-ones. for rural pps hospitals to survive, congress must continue to support these programs, in fact making them permanent. likewise rural hospitals should be exempted from a sequestration and future medicare cuts. we also need continuous support for programs like the 340-b drug discount program a lifeline for cms, which also saves money for the state and the federal government. finally, grant fund shotgun be made available for rural hospitals to assist with the transition to icd-10 and the larger conversion to future care delivery in future models. thank you for the opportunity to present this testimony today, and i look forward to answering questions you may have. >> thank you mr. wolters. dr. anderson? >> chairman cochran, chairman blunt, ranking member murray and distinguished members of the subcommittee, it's my pleasure to join you today to discuss how telehealth is improving health care in rural communities.

my name is christy henderson and i'm a nurse practitioner and serve at the university of mississippi medical center in jackson. mississippi ranks at the bottom for overall health obesity, heart disease, diabetes, and preventible hospitalizations. more than half of mississippi's three million citizens live in a rural community, and almost a quarter live at or below the federal poverty level. two-thirds of mississippi's hospitals are located in rural areas and lack sufficient resources in specialty care. but despite these facts, telehealth in our state is increasing access to health care and improving outcomes and lowering costs. the ummc center for telehealth began in 2003 with the teleemergency program connecting critical access emergency to departments to physicians at our trauma center. 12 years later telehealth allow us to provide over 35 medical specialties to 166 sites around the state, including community hospitals and clinics, mental

health facilities, schools and colleges corporations, prisons and even in the patients' homes. we connect sites in 52 of the state's 82 counties and serve an average of 8,000 patients a month. since 2003 we have been awarded over $9.7 million in federal grants to purchase devices, conduct workforce training and enable the technology that we use to serve patients daily. this early funding allowed us to test delivery systems, areas of practice, and service locations in order to craft an effective and impactful model worth replicating. without early critical support from usda, hrsa, fdc and others our network would have been very slow to deploy, taking the longest to reach those with the most need. today our system is completely self-sustaining. a critical factor to our continued sustainability is the reimbursement parity available in mississippi.

prior to 2013, insurance companies in mississippi did not reimburse for telehealth services. we argued that mississippi would ultimately save money if they did, and undertook a series of pilot projects to prove it. we were successful. in 2013 and 2014, governor bryant signed legislation mandating that health insurance companies reimburse for telehealth services at the same rate as in-person services. these policies changes were the catalyst for the rapid growth of our system. while increased reimbursement may cost more in the short-term, years of data from our state and numerous others prove that the cost savings achieved through better chronic disease management, fewer er visits, and aggressive preventative care far outweigh the expenditures. given the success we have seen in mississippi, i can only imagine the exponential impact of offering similar federal parity for mental health. i commend cms for opening new code secs for reimbursement and

hope the committee will encourage them to expand coverage for more services in more communities, be they rural or urban. without reliable connectivity we cannot serve rural patients. thanks to support from universal service funds and our telecom partners we are able to bring much needed health care to rural mississippi. it is this connectivity enabling remote patient monitoring in the home that is changing lives in ruralville, mississippi. last fall we launched a research pilot aimed at managing 200 uncontrolled diabetics through aggressive in-home monitoring and intervention. once enrolled patients are sent home with an electronic tablet that monitors glucose readings daily, provides educational information, and transmits health data to specialists monitoring them hundreds of miles away. for the first time these patients have access to a medical team dedicated to their care ophthalmologist, endocrinologists pharmacists,

nutritionist and nurses. preliminary results show that the majority of patients have already met or exceeded the goals that were set for the end of the study. with one exception none of our patients have gone to the er or been admitted to the hospital for their diabetes. the results are improved care at a reduced cost. so we look forward to working with the committee and would like you to consider these few points. the need to test reimbursement parity at the federal level, particularly for remote patient applications. the only way for us to know if the success of pilots like ours can be replicated at the federal level is to test it. now is the time for cms to pilot new reimbursement parity models for telehealth especially were in-home monitoring impact is the greatest. the continuing need for support for telehealth. while our network has become self-sustaining, it will not be complete until we reach every mississippian. the need for federal funding remains, and efforts to coordinate opportunities across the agencies should be encouraged.

the need to remove geographic barriers for reimbursement. rural or urban, telehealth is a powerful tool in improving access to care and should be inventivized. we recommend that geographic restrictions for cms reimbursement be removed. and then lastly, the need for continued support for universal service funds. a reduction in any of the usf fund willing not only impact current operations, but will significantly hinder our efforts to offer remote patient monitoring in rural communities. fund shotgun be protected. our mission is to increase access to health care and improve outcomes and reduce costs. telehealth allows that to happen. i thank the subcommittee or to the opportunity to testify today and look forward the answering your questions. thank you. >> thank you, dr. henderson. ms. peterson? >> chairman blunt ranking member murray and members of the subcommittee, thank you for the invitation to testify today. my name is julie peterson, and i'm the administrator of pmh medical center, a critical

access hospital located in prosser, washington, a community of about 6,000 people. pmh is organize nieszed as a public hospital district, and we serve about 68,000 rural residents in two counties and five small towns. the mission of rural health care providers like pmh is to ensure access to high quality, affordable care for populations that are challenged disproportionately by distance, poverty, age chronic conditions, and cultural barriers. many of our patients do not have reliable transportation, paid sick leave, and the other resources that allow them to travel to receive care outside of their communities. in short rural communities are older, sicker, have poor health status, and face significant economic challenges. it's never been easy to provide access to high quality care in these communities, and it's more difficult today than ever before. as is the case with most rural

communities and hospitals, pmh is more than just a hospital. we are the backbone of the community health system. what you may think of as traditional hospital activity makes up just slightly more than a quarter of our business today. in my written testimony i included an extensive list of the nonhospital services that we provide. everything from primary care to our 911 ems service. we are a fully integrated delivery system dedicated to meeting the health needs of our community in a coordinated way. but the current reimbursement system does not recognize that reality. reimbursement is siloed, and there are as many ways as we get paid as there are services we provide. this makes sustaining a coordinated health system for our community very difficult. for example, i need to be moving forward to create medical homes for my residents. i need to be integrating

behavioral health and medical health in my rural health clinics. but there are so many reimbursement variables that i cannot assure my board that we can sustain these programs. the current fragmented financial system destabilizes rural health. another challenge we face is that many people in our area remain uninsured. that's despite the fact that our state had a very successful medicaid expansion program. we provide coverage to 535,000 additional washingtonians through expanded medicaid and the health insurance exchange enrolled another 170,000 washingtonians. these efforts need to continue. rural communities also face greater shortages of health care professionals than their urban counterparts. as the ceo, physician recruitment is a constant activity for me. i have an aging workforce and our doctors are still required

in many cases to participate in call, which is not the case in urban areas. so they work very, very long hours, and they see far more complex cases in the clinic setting. programs like the national health service core and the nurse training initiatives enable many communities like mine to attract the providers that they need. these challenges our unique population, the fragmented population and work financial shortages make it very difficult for rural health care facilities to survive. we need flexibility. in washington, as senator murray pointed out, we've identified about ten very small critical access hospitals that might be facing eminent closure. that awareness has led the association, the department of health, the state office of rural health and others to begin seeking new delivery system models. our goal in washington is to develop and test one of these new models within the next 12 to

18 months that is a very ambitious timeline but it is justified in view of the plight of some of these smallest facilities. one invaluable tool in this effort is the cmmi grant that provides $65 million to the state for the healthier washington initiative. we also have two rural hospital collaboratives that are funded in part through hrsa grants that are working with critical access hospitals and rural clinics to pioneer rural network development and outreach. the federal office of rural health policy and the washington office of rural health have been generous partners in these efforts. we will need continued help from these officers and from cms if we are to succeed. finally, i'd like to take a moment to brag a little bit about the leadership shown by all of our washington hospitals in advancing quality of care and patient safety. the centerpiece of this effort

was an $18 million grant that funded our hospital association's participation in the hospital engagement network. this quality and safety improvement work, this $18 million grant, has generated $235 million in health care savings through a reduced readmissions, fewer hospital acquired conditions, and healthier babies. that's just one example of how our rural hospitals are preparing for a future where measuring quality, efficiency, and service will be essential. we are ready to demonstrate our value to partner hospitals, health plans, and to our patients. rural providers are dedicated to ensuring that the people who live in rural communities have access to the highest quality of affordable medical care. i'm optimistic that we can achieve this goal. the programs that we're discussing at this hearing today are valuable tools on that journey. thank you. >>