s is out there with our soldiers and their families. there's no doubt in my mind we have to increase that throughout the force, throughout the total army and undeed throughout the entire military. there's things like what to look for, signs, indicators and warnings of reconnaissance and surveillance by enemy and the terrorist on a particular compound or particular person. unfortunately though a lot of these types of attacks are very ambiguous. this one in chattanooga may or may not have had indicators ahead of time. may or may not have been a lone wolf. we don't know yet. so both access and passive information with all of our families and soldiers, airmen and marines. >> i appreciate your insight on that. i next wanted to follow up on some questions that senator wicker asked and some comments

that we made. among the most contentious issues over the past two years involved the army's restructuring initiative. i understand the army has been put in a difficult position by budget reductions and over the past several years has been exploring a number of option to maximize come pat power while at the same time trying to combat costs. congress has similarly been taking a hard look at this which is why the commission of the structure of the army was established in the ndaa. if confirmed will you comment to thoroughly reviewing the army's aviation restructuring initiative and working closely with congress once the commission report is delivered next year to help us figure out the best path forward on army structure issues? >> absolutely will and i look forward to reviewing the commission report.

>> and what do you think are the biggest threats that should you be confirmed you'll have to prepare the army to address in the coming decade? >> i think the army's fundamental mission of engaging in ground combat, winning in ground combat, i think that mission remains sound and i anticipate that mission will remain so in the future. the three key tasks in the national security documents that are out there is to assure allies, detur opponents and if necessary night and win on the ground. all of those are challenges in the years ahead as we go forward. >> thank you very much. i see my time expired. thank you, mr. chairman. >> thank you, mr. chairman. general, i wanted to talk -- you talked about budget constraints

and looking at ways to reduce those. one that you didn't mention is making sure there's no overlap in terms of core competencies and missions. i assume you think of a core competency the air task force, ability to deploy at any moment. >> they are a core competency of the united states army, that's correct. >> one of the things i have been concerned about, when you look at the army pacific pathways mission, my office has been asking the army for weeks now on what the costs of that are. we haven't been able to get any answers on that. but to me you see that value in terms of our nation's defense bct with regard to the army or putting soldiers on navy ships and doing maneuvers out in the pacific. what's a higher value for the army? >> i they're both a value to the army. and i do think that army forces on shipping and moving them

around the pacific has been done really for over a century. that's how the army moves, by air and by ship. so -- >> you don't see that as redundant to the marine corps mission in the asia pacific? >> no, not at all. the reason i say that is they compliment each other. but the marine corps competency is amphibious assault. what we're really talking about is strategic movement of army forces over the ocean. we're not using any gray hulls to do that anyway, we're using black and green to do that. >> so if you had to choose in our budget times, would the army want to focus on airborne core competencies or a mission that in some people's view looks somewhat redundant do another's services. >> frankly, senator, the army has to do both. >> i'm asking if you had to choose in this kind of austere budget, you have to choose. >> we have to be able to do both. we have to. we don't have a choice. we have to maintain both capabilities. forced entry from airborne

assault and move forces from both air and sea to reinforce a variety of contingencies. >> so we'd appreciate some numbers on the pacific pathways in terms of costs. >> sure absolutely. >> i want to turn to another issue, kind of a merging threat issue. you and many others who have testified have talked about russia as a principle threat, and certainly that's the case in ukraine. i want to emphasize and talk a little more about the arctic. you've probably seen in the last few weeks there's been articles, got this in the airport today, russia has made military buildup in the arctic a strategic priority. there's article after article about the russians moving huge force posture, huge force structure, four new bcts, big operations that nobody is even aware of that are taking us by surprise all through the arctic.

you've probably seen this map that has new airfields, 11 new airfields, 40 arctic icebreakers, some nuclear powered. the u.s. has these forces here. that's it. this recent decision we're going to remove a key capability of these. and we have this as our strategy. this was the 2013 dod arctic strategy, mentions climate change five times and in a footnote mentions russia. this is a joke of a strategy. and i think during our deliberations for the ndaa the congress recognized that this was a serious issue, a serious new threat environment. so we had and amendment that came through the ndaa that focused on our interest in the arctic, the need for a much broader assessment for a much more serious look in terms of old plans, in terms of an military strategy. and that passed unanimously. but what i was wondering, when you look at -- so the secretary of defense has to put forward this strategy within the next year. and yet our most capable arctic forces before we do the

analysis, before we do the planning, before we do the old plan, we're going to remove the most capable, indeed the most lethal arctic warriors that we have. and as you know, general, it takes a long time to become proficient in the arctic. i'm wondering what your thought is on that and if confirmed, i think it makes sense to do the analysis first, the do the old plan first, to do the strategy first before we move any force structures. would you commit to work with this committee to hold off on moving arctic forces, particularly given the dramatic threat increase, until after the secretary of defense and others

have put together an arctic strategy as defense guidance from this committee and this congress? do you think that that's the most lodge a call way to do the planning? >> i appreciate that, senator. and i agree with you. i think having an old plan force and figuring out our task organization second is the right sequence and i think that is in fact what's about to happen. i think as you already mentioned, the arctic old plan, the arctic strategy is going to get reviewed by the osd. the general mentioned that the other day. >> there is no o plan there is no strategy unless you want to call this a strategy. so there's a lot of work that needs to be done. >> there's a lot of work that needs to be done and it's under review as i understand it. and i think you asked general dunford to produce a plan and he

committed to do it and i look forward to participating in that and we'll work with that over the next year. the forces in alaska don't get reduced, according to the decision i think i heard, don't get reduced until the end of '16 and '17. so the o plan first, reduction of forces second if still required and i'll work with you on that. >> good. because to me, again, i think it makes strategic sense, put together the plan, see what the commanders need in terms of troops, see what the new threat level is and then make the plan on troop levels once you're informed by a real strategy. not a 13-page documents. thank you. >> general, i would just like to say that senator sullivan raises this whole issue of the arctic and the recent russian moves in that region. we need to pay a lot more attention to it.

we see our friends in norway in particular, but also sweden, finland, those nations there that are experiencing things like russian overflights and russian submarine activities and other -- i believe that the russians have, what is it, senator sullivan, 50-some icebreakers? >> close to 40. >> i think we have one. is that correct?? >> yes, sir. >> so we've got a very full agenda. but the arctic i think is another area that we have to be concerned, particularly given russian behavior. even sweden, which is traditionally as we know a very neutral nation has become extremely concerned about russian activity in their territorial water. and as we see climate change -- as we see areas of the arctic opening up to being oceans,

areas of navigation, this is an area that i hope we'll spend some time on. and i thank senator sullivan for his attention and involvement in what is, i view, a looming situation with russia. i thank you, general. va officials warn this week

we have live coverage coming up for the health care market. a panel will look at what coverage plans are available in what markets and what the different costs are, and it's hosted by the alliance for health reform. we will give you an update on the horizons to pluto. we are told there will be new images to see and that will be live at 2:00 eastern and we will have it here on c-span 3. today live coverage from the national governor's association. and you can watch all that live today on our companion network, c-span. the house is not in session

today but the senate is and lawmakers earlier voted to move forward with debate on a six-year highway funding bill. a couple key things came out of the session early, and we learned mitch mcconnell is mounting another attack on the affordable care act and he will produce an amendment to the highway amendment that could repeal the health care law. there was also drama as texas senator and 2016 ted cruz came to the floor and accused mcconnell of lying for included an amendment for authorizing something that the leader said he would not do. mitch mcconnell's action also keep texas senator cruz from offering an amendment on the iran nuclear agreement. you can see the senate live on our companion network c-span2.

guests include, the chairman of the board of the pittsburgh pirates and the cia of the rocky mountain elk association, and that's saturday on c-span starting at 9:45. >> the governor addresses the opioid crisis. later, the governors will discuss how to stimulate their state's economy and its impact on the employment rate with thomas perez. sunday evening at 6:35 eastern an interview with a former

governor of rhode island. that's on c-span 2 on book tv. and then letters sent to the presidents about domestic and foreign policies. also, this weekend saturday night at 7:15, lawrence kaplan on the history of computers

hackers and the government's response to computer abuses. get our complete schedule at cspan.org. freedom breeds inequality. say it a third time. >> twice is enough. >> always to the right and almost always in the wrong. >> filmmakers robert gordon and morgan neville talk about their movie "best of enemies" between the conservatives and liberals over wars, politics god and sex. >> there is not somebody in their ear, very unlike today. and today somebody is saying the numbers are dwindling and talk about, you know, hot topic -- hot topic number two, you know,

whereas then -- i don't think that was the norm in tv at the time, and i don't think these guys would need it and they didn't need it. >> and the moderator was a distinguished news man who i think was embarrassed by this. he was moderating but he disappears for sometimes five or more minutes at a time. today you would not have a moderator not jumping in every 30 seconds. i think, really, everybody at abc just stood back and let the fire burn. >> sunday night at 8:00 eastern and pacific on c-span's "q & a." and tuesday the american enterprise institute had a forum, and speaking at the forum the speakerevent was held to implement

the anniversary of the law. it's about 40 minutes. thank you for your very kind words. i am told c-span is filming live, and if so my wife and children are watching back in dallas and they believed even fewer of them, but nonetheless, thank you for the very kind words. we know those on the left have been known to occasionally travel into fact-free zones and for them occasionally story telling has replaced truth telling, but not with my dear friend, peter wallaceson. his work on the true causes of the financial meltdown is a pair

dime of scholarship, and if you have not read his work "hidden in plain sight," and we need more of the solid research done. i am assumed this was designed to be intentionally ironic, since we know conventional wisdom is liberals have no heart and liberals have no brains. there may be little arthur can do to help those on the other side of the political spectrum, but there is much that he has done to change the misperception

of conservatives or create or restore a conservative language that speaks to the heart and not just the head. as we all know, the founders were deeply conservative and yet they spoke a powerful language of personal worth and happiness and that sparked a revolution of equal rights and liberty that is still transforming the world today because it's the conservative movement that lays down the foundations for meaningful work and family and community and faith. the institutions that make it possible for every human being to pursue their god-given right to happiness. i am told this is his 11th book, and he is writing them faster than i can read them, but nonetheless there is the august district work period coming which is when i catch up on my reading and i look forward to

catching up on his latest work at that time. thank you for inviting me to aei. i have been long an admirer of the work that has been done here, and i already thanked peter, but other scholars who are here, freak contributors to the efforts of the majority in the house financial services committee. their works are very very admired. although wearing a different brand, mr. claiborne, welcome to you as well. ladies and gentlemen regretbly something is changing in america and not changing for the good. the animal spirits of free enterprise and entrepreneurial risk taking are being taeupld. this corresponds not only to the economic changing times we see

but to the loss of freedom in america today. my remarks are focused today on the unhappy results of the dodd-frank act the so-called wall street reform and consumer protection act which was signed into law five years ago today. no need to be the first one in your neighborhood to throw a celebration. weighing in at over 2300 pages with new addministrative rules, it's a re-write of the laws since the new deal. at this time the proponents including the president said it would promote financial stability. yet five years later, the evidence continues to mount that our society is now less stable less prosperous and less free. the financial panic of 2008 clearly caused much anger against financial firms and the bailouts, courtesy of the taxpayer that they received.

the liberal story has been that an al kau me of wall street greed out sized washington deregulation almost blew up the planet. this necessitated enormous taxes payer bailouts. although faults the narrative has permeated the bali politic. and churchill's remark was history will be kind to me for i intend to right it. we have allowed the left to write the first history of the 2008 financial panic, and thankfully peter has written the definitive history of the 2008 panic, and other scholars at aei and other conservatives have followed as well. it's clear now the financial crisis did not result from

deregulation but from dumb regulation. total regulatory restrictions on the financial services grew every year in the decade leading up to the financial crisis including such landmark laws that were aimed at stopping abuses, but washington not only failed to prevent the financial crisis, in many ways it led us into it. it encourages bad loans supported by fannie mae and freddie mac. more than 70% of the sub prime mortgages that led to the crisis were backed by fannie freddie and other programs. liberals asked fannie and freddie, let's roll the dice a little more and the taxpayer and

we all lost. if you have to point at a root cause of the financial crisis this was it. government housing policies. additionally the federal reserve did its part by maintaining a highly accommodative monetary policy that dramatically lowered interest rates and kept them low for a very long time and inflated a housing bubble. sound familiar to anybody? let's examine another part of the left's narrative of the financial crisis and the claim regarding, quote unquote, out sized risks being taken by financial institutions. the willingness to bear risks was one of the central ideas upon society rests, and risk is an element for praus spare tea as well. to take away risk from the system is to take away opportunity and innovation for

the common man to succeed. ladies and gentlemen, if we ever lose our ability to fail in america we will one day soon lose our ability to succeed. for those who want washington to be the final aurb tur, they should decide if washington is competent to manage risks. the national flood insurance program is $24 billion underwater, and yes, the pun is intended. the pension benefit guarantee corporation is running a total asset deficit of approximately $62 billion and fairly recently the housing administration received their first taxpayer bailout courtesy of the obama administration. let's turn to greed, and there's an article from the left that

said it was wall street greed that caused the crisis. my question is when hasn't there been greed on wall street? how could that not bebe the factor. ladies and gentlemen dodd-frank is the epitome of washington greed. it has made us less financially stable in many ways. since the passage of dodd frank the big banks are bigger and the small banks are fewer, and because washington can control a handful of firms much easier than many small zealous competitors this is likely an intended and not unintended consequence of the act.

it codifies into law, too big to fail and taxpayer funded bailouts. the nonpartisan congressional budget office estimates it will cost taxpayers over $20 billion. dodd frank may not prove such a bad deal after all, it can shape regulations guaranteeing the taxpayer bailouts for themselves. it erodes market discipline and risks further bailouts to be paid mostly by lower and middle income taxpayer families. it becomes a self fulfilling

prophecy helping to make firms bigger and riskier than they otherwise would be. let's look at two other prime examples of dodd-frank risks. first, the derivatives market. they were perceived to be at the heart of the crisis. they would mandate certain derivatives to be clear through centralized clearing houses. it then designated these clearing houses as a whole new class of institutions it calls fmu's, since washington excels at acronyms. guess what the fmu's receive? immediate access to the fed's discount window. you might expect these private firms to resist this type of socialization, the former fdic chair said some of the clearing houses were, quote, drooling at

the prospect of having access to loans from the fed when title 8 was being crafted. dodd-frank did not lesson risk but just centralized it and placed it on the taxpayer balance sheet. next is the dodd-frank horror known as the rule the convoluted regulation that hits main street businesses in the heart. it's a paradigm for a solution in search of a problem. it severely limits financials in taougs for proprietary trading. of the institutions that failed during the 2008 financial crisis, not one was due to proprietary trading, not one. in fact, financial institutions that vary the revenue streams were able to keep lending and support job growth in our economy. while volcker still searches for

a problem that does not exist it's creating a new problem that didn't exist before, and is that dramatically reduced liquidity in our corporate bond markets. many economists believe the next financial crisis could very well result from the ill ae quill tea and volatility in the bond markets. recently some of you may have been an opinion pieced by blackstone who wrote locked up markets will force banks to hoard liquidity, to satisfy regulatory tests. with individuals suffering losses and companies not able to raise capital the economy will contract with layoffs and lower tax incomes and paying for lower middle income americans. i agree. in addition to making our economy in many ways less stable dodd frank has also made us less prosperous, and that's what i will discuss next.

it has created 12.1 fewer jobs than the average recovery in the post world war ii era. small business startups are at their lowest level in a generation as well. had this recovery merely been as strong as the average recovery in the postwar era, middle income american families would have $12,000 more in income and 1.6 million more americans would have escaped the trap of poverty. but more than the numbers, my constituent constituent's angst says this,

my son is a disabled veteran who lost hope of a decent full-time job. another wrote quote our small business recently laid off 25% of its workers and the remaining of us took a 15% pay cut and that's probably not going to be enough without more layoffs for tenured people. ladies and gentlemen, every member of the congress is still receiving letters just like these. the painful truth is dodd-frank and the hyperregulated obama economy are failing low and moderate income americans who simply want their fair shot at economic opportunity and financial security. dodd-frank killed off a financial benefit many took for granted, free checking. 75% of banks used to offer free banking but just two years into the dodd-frank regime only 39% did so a trend that many

attribute to the price controls in the durbin amendment. this is brought up in committee just last week and the democrats at my committee sneered at this but for low and struggling middle americans it's no laughing matter. a recent report states one-third of all blacks and hispanic borrowers may find themselves disqualified for obtaining a home specifically because of the qualified mortgage rule based solely on its ridgid debt to income requirements. one-size fits all. for the more, according to the fdic more than nine million households don't have a savings or checking account because fees

are too high or unpredictable and another consequence of dodd-frank. there was consequences that crippled growth that was supposedly aimed at wall street but has hit main street. community banks and credit unions supply the bulk of small business and the combined weight of dodd frank's 400 new regulations dragging them down. in fact we are losing one community financial institution a day in america. one texas community banker wrote me, my may major risk is not credit risk. my number oneris sbg federal regulatory risks. the corporate governance prau

provisions 9 hit every store. they must comply with regulations that functionally impose wage control, and private compensation disclosures, all that were written for wall street investment firms. every dollar that a main street business has to invest in lawyers and accountants to explain this gibberish is taking out of worker's wages in capital investment. is it anyone dur that our economy is limping along 40% below its historic normal. no wonder phrpbz lose sleep at night, worrying about their stagnant wages and their children's future. third and perhaps most ominously, dodd-frank has made us less free.

we are losing not only our economic freedom but our political freedom as well. today americans are less and less governed by the rule of law and more and more governed by the discretion of regulators. it's osha now, not congress that governs over workplace safety, and it's the epa and not congress that governs over the environment, and now it's the bureaucratics that are over the financials. dodd-fran sbg not directed at people, and it's an outline directed at bureaucrats and ininstructs them to create more bureaucracies. and the aforementioned cfp and the financial stability

oversight council. both operate largely out of public view and both are subject to virtually no checks and balances. in both, alarmingly have been granted sweeping unilateral powers to control a use swath of the u.s. economy. and the single most powerful and least accountable federal agency in our entire nation's history. the cfpb or the one director has almost absolute discretionary power to find any consumer product, quote unfair or abusive and thus outlaw it. when it comes to credit cards or auto loans and mortgages of hard-working taxpayers, they not only have unbridled power to make them more expensive, but it has the power to take them away. and then there's a regulator

that helped to cause the financial crisis or were largely negligent in preventing it in the first place not withstanding they had the regulatory authority to do so. dodd-frank rewards their failures by granting them the most sweeping powers over the capital markets since the new deal. it allows federal regulators to unilaterally define financial stress and financial stability. by defining these terms it can dictate capital standards product mix and lending activities of any major financial firm within our economy. should firms not bow down to fsocs will, it's empowered to break them up.

in relating to senate security, it may very well be the nation's least transparent federal agency. better markets advocates for more regulation of the financial system says the proceedings make it look open by comparison. it was the risk of the shadow bank bg system and yet a far greater danger instead was imposed by the shadow regulatory system that operates beyond checks and balances of the three branches of government inshrined in the constitution. when the founders set up a system of governance they set up for a national economy under the rule of law, and they wanted a society of entrepreneurship, and they dismantled high barriers to

these. they wanted all citizens including those in the old world that were at the bottom of the ladder, the needy and poor to arise in the new land of promise. it was not arrogance that made america the new land of promise for they knew there was a contradiction between the land of promise and the millions in bondage, here whose human worth and natural rights were denied. the founding generation could not find a way to free them at the start, but they did at least boldly proclaim that all human beings are entitled to their god-given rights. they had the foresight to build a economy, and when the liberation came the opportunity to rise would be theirs as well. for generations afterward there was enough opportunity for the poor and the oppressed of many lands to realize their dreams in our land of promise, inspired by the founders' conservative

vision of freedom opportunity, accomplishment and happiness. never, never in the history of an economic system under the rule of law have so many been so successful and prosperous for so long. in america we understood we didn't need free markets to create private riches or government, because material positions could never substitute for meaning and purpose in one's life but economic freedom means more than wealth, it means achievement, and it means productive work and it means savings and imagination and enterprise all of these are entitled to their just reward. when government taxes smothers your imagination with a thick web of rules, they have not just taken your wealth but robbed you of your purpose and stolen your right to pursue your dream. even worse although the progressive version of

government by the rule of regulators claims to cut the rich down to size, and it's the poor those who are struggling at the bottom to better their lives who are pulled down by such uncompassionate policies. the american idea, the unique idea unites the goal of happiness that must not be severed. america is unique. so ladies and gentlemen, tomorrow is another day. as i look to tomorrow, i see an america with the most competitive, innovative and transparent and competitive financial markets the world has ever known. tomorrow i see an america with economic hreublibertyies of every american truly respected. a surging economy for anybody

willing to work hard and dream big dreams. to reach that tomorrow today we must commit ourselves to nothing less than replacing dodd-frank. with this first step together we can win back america's promise. thank you very much. he has kindly agreed to take a few questions. he has to leave at 3:10, so that's when we will adjourn. in the meantime if i can remind you again, if you have a question, tell us your name first, your affiliation and then ask your question and we will keep going until 3:10. yes, sir wait for the microphone, please.

right here. sorry. right in front. there we go. thank you. >> i should have kept my hand up. in terms of legislative -- >> give us your name. >> my name is rob treubnely and with bloomberg. what is the legislative way forward for you if there is that much opposition from the other side? is there -- are there bipartisan talks going on or are we at a complete partisan impasse? >> well, i hope not. particularly when it comes to regulatory relief for community financial institutions, we have attempted to work with democrats. in fact i am proud our committee put forth already

phaud rust regulatory relief provisions provisions. untpoer untpoer i do not believe barney frank to be among somewhere he would amend his own law. there's little i agree with elizabeth warren on, but she believes it has not solved too big to fail. democrats are going to decide that dodd-frank is a brand to be protected or a legacy to be secured? i don't even think we have quite have had two-thirds of the rules finalized as of yet and i am thoroughly convinced the left was working on obamacare before obama was even born so this may

be a long labor and i am a patient man and even by washington standards, relatively young. >> i think there was -- did we have another question? here? no? okay, right over here, please. >> you mentioned that by being declared significantly important financial institution, you're basically codifying too big to fail, and if this is true then why is our -- is metlife suing its designation as too big to fail? >> well you have to ask metlife. i suppose it's an insurance company and they don't want to have a bank -- a bank capital standard imposed upon them. it's a completely different business model. the fed has no experience in

applying capital standards to an insurance company. so again you would have to speak to them. listen it's a mixed bag to have the federal bailout behind you, but i suspect they don't want those capital standards imposed upon their business. i am quite certain asset managers don't either. again, these are not banks. these are completely different types of financial institutions, and maybe they know what i said in my speech the federal government doesn't have a particular good track record in managing risks in the first place. >> this lady in the yellow there, thank you. >> elin middleman, attorney. i am from indiana, and my family had interest in a small bank in

indiana for many years. what can the local bankers do if dodd-fran sbg not repealed to fix the problems you described they are facing? >> i am a legislature and not a banger. er banker. the good news is i feel confident there is going to be an election next november and i believe that now we have five years of data and five years of an incredible strong evidence that dodd-frank is making us less free and prosperous and stable. the data is undeniable. we are losing the relationship banking model in america today. they are losing their competitive advantage. so when you say, what is it they can do? well, they can have their voice heard and the right to petition

your government and i would continue to have them appeal to some of the more reasonable democratic minds in this city, and believe it or not i do not i do not consider that to be an oxymoron. i'm afraid too many of them are intimidated by the voices. it's a struggle between the left and far left and sometimes the left hand doesn't know what the far left hand is doing and the far left hand is choking off any reasonable debate about the fate of our institutions be they bank or credit union. how they adjust their business model under this regime i'm not sure i'm qualified to say. but house republicans are doing everything we can to get help there as soon as possible. and any time democrats ss are willing to work with us there's an open door to work with them to try to save these banks and

credit unions. >> we'll call on mark and then we'll get to you. can we get a microphone up here? >> before you ask the question, remember, i did say nice things about you. >> absolutely this is going to be helpful. first, i want to address the question about why metlife may be too big to fail and remind us the advantage of being too big to fail is you got to borrow at a lower rate. jpmorgan where about 40% of their balance sheet is long-term debit versus pltmetlife. as are institutions like pnc. there's really not a too big to fail advantage and we run the risk we're encouraging metlife to become more leveraged. my question for you is other than repealing title 2 what would you do to end "too big to fail"? >> you can make a case after '08

that capital and liquidity standards were insufficient. i don't think you can make a case they were insufficiently complex. so i think the key, mark, is to focus on what are those appropriate levels. but as you well know, it's the classic goldilocks tradeoff. if you get the porridge too cold you have perhaps 2% economic growth when history tells us we've averaged 3.5%. with the right public policy we could be doing 4 1/2 to 5. if you get it too hot, then all of a sudden, maybe you are looking at more cascading failures. right now the danger is we are allowing credit to be politically allocated in america by federal regulators who are the ones who brought us to the precipice of the crisis in the first place that deciding

prudent underwriting standards in real estate should be thrown on the ash heap and we can live in this bold new world that anybody can own a home. i want everybody to have the opportunity to own a home but federal policy and policy regulators did nobody any good by putting people in homes they couldn't afford. i don't know if i can get rid of title one or title two but i'd hope there would be some common ground on trying to work for more simplified capital and leverage ratios based upon historic norms that on the one hand can't be gained by the participants and does not empower federal bureaukrats to be central planners. >> you've been waiting here and then we'll get to you.

if you'll wait for the microphone, please. >> yes -- >> remind us your name and affiliation. >> -- i just wonder if congressmen can really do something about our system. our system when you say conservatives -- i wonder if you can really fix the system. misinterpretation of the free economy, free enterprise it just means free for those who can run other people's resources, including public individuals or family businesses so there's no way to have a good economic development of growth.

so unless -- >> i think we're going to stop there. chairman, the question is how do we fix the system? >> how many hours do you have? >> well, we have six minutes. >> i don't have a short pithy answer. if there's fools in office it is fools that put them there. my experience is that politics is not so much governed by numbers but governed by intensity. what it will take is people becoming more aware more politically active in the system, and part of that is the work of aei to empower people with knowledge and facts and arguments, but it's -- i understand that the congressional approval rating stands somewhere between has lice and bubonic plague. i get that.

and so people are concerned about the system as they well should be. but america is polarized at the moment. i think the polling data bears that out. there shouldn't be a surprise congress is pole arized as well. i had very strong thoughts on what's right and wrong. you never let principles interfere with trying to compromise policies. again, jefferson said the ground of liberty is to be gained in inches. they'll ask myself to question at the end of this process this piece of legislation taking me in a direction i want to go or don't want to go is more good or more bad? so i think it is important. how do we improve the system? the american people have to hold their elected members accountable. they have to educate themselves about the process and decide ultimately what values do they believe in. i still believe the american people believe in the core

values of economic liberty. well, of liberty, period. it was economic liberty, religious liberty, political liberty that brought people to our shores in the first place and are bringing them to our shores. i believe in american exceptionalism. people have to take enough time to understand the policies, hold their members of congress accountable. and they can start by talking to democrats about the plight of community banks. >> we'll have a question here, and this is going to be our last question of the day. >> unless it's difficult, then we'll make time for two. >> thank you for that wonderful speech. i was on senator dodd's staff during the drafting process. i didn't understand it then and i'm more puzzled now. >> more importantly, did he understand it? >> why couldn't the bill be a compromise bill? why couldn't it have -- sarbanes

oxley was bipartisan. why didn't dodd or frank attract enough thoughtful leaders like you to make it a different product? >> well, you would have to talk to them. i cannot climb inside their inner most thoughts. the democrat party was enjoying a rare super majority status. in the house, in the senate at the time. and because of that they did not need a single republican vote to pass their agenda, and they were not interested in doing something that the whole of the american people might be able to embrace. they had a super majority that a party might enjoy once or twice in a century. i recall the words of now chicago mayor rahm emanuel. never let a serious crise gisis go to waste. it allows you to do things you

otherwise wouldn't have been able to do. a lot of dodd/frank was a grab bag wish list that had nothing to do with the causes of the financial crisis. and let us remember, peter is well aware of this. the commission report that reported on what the root cause of the financial crisis were came out after dodd/frank was already passed. so it's kind of like playing basketball and the other team hasn't shown up and you dribble and dunk and they decide to dribble and dunk and unfortunately, the american people, i think, have again suffered less freedom less prosperity and less stability because of it. and my hope still is in divided government there will be at least enough democrats to say, maybe there are ways we can at least clarify dodd/frank. maybe there are ways to improve dodd/frank. i'm not going to give up my quest for replacing it but i can walk and chew gum at the

same time. i can work with democrats and find common ground and try to keep a few more community financial institutions alive and try to improve our gdp. that's a better question for them, and haven't seen either of them in a while. anyway, thank you very much for this rare privilege to speak before you. >> thank you very much. >> thank you very much. when congress is in session c-span c-span3 brings you more of the best access to congress with live coverage of hearings, news conferences, and key public affairs events. and every weekend it's "american history tv." traveling to historic sites discussions with arthuthors and historians and eyewitness accounts of events that span the nation. coverage of congress and american history tv.

live now to capitol hill for a discussion on the various health insurance plans available to consumers amid changes to the health care law. participants will talk about how prices and premiums have changed since the implementation of the affordable care act. it's hosted by ed howard of the alliance now making some introductions. live coverage on c-span3. >> -- and evaluating their care options. well, today we're going to look at how well consumers are prepared to make those decisions. how literate are they for example, when it comes to things like deductible ss and co-pays. what information do they have available and how hard is it to get that information. and can these empowered consumers, if we can empower them, drive the system toward

lower costs and higher quality. those are the other two of the triple aim. now we're pleased to have two partners in today's program. anthem which operates blue cross plans providing coverage to more than 38 million americans and the national consumers league, america's oldest consumer organization. their mission is to protect and promote social and economic justice for consumers and workers. i should mention that with these same partners, anthem and the league we'll be exploring in september a related topic that is the kinds of tools available to us when we become actual consumers of care, otherwise known as patients and we think it will be a valuable book end to the kind of discussion we hope to have today.

a couple of logistical check-offs before we get going with the substance. you'll see that the wifi credentials are on the screen. they are on the table in front of you in case you want to get on to the internet. and one of the things you might do if you need that is to tweet comments and questions about the conversation. the hashtag #consumerhealth is the key to doing that. now in your packets you'll find a lot of information, including speaker biographies, more extensive than i'm going to have time to give our folks. there's a one page materials list that you'll find useful, i believe, along with the power point presentations that the speakers are going to use. you can find all of that also at

our website allhealth.org. there's going to be a video recording of this briefing available as early as monday followed by a transcript a couple of days later. also on allhealth.org. at the appropriate time i have two colors for you to remember. green question cards where you can use your pencil or pen to put a question on them and have them brought forward, and we'll try to get to as many of them as we can. and the blue evaluation form, which we hope you will take the time to fill out before you leave because we want to get your feedback particularly those of you on congressional staffs because we want to be responsive to the kinds of information, the kinds of speakers and topics that you think are important in trying to get through your job.

let's get to our job which is to present you with this program. we have a terrific lineup of panelists today. and we're going to go through those presentations and then open it up for questions, both among the panelists and from the moderator and you will have a chance to ask your questions as well. i'm going to start with rebecca berkholder, the vice president for health policy at the national consumers league. rebecca we've asked to give us a sense of some of the challenges posed for consumers today in selecting a health plan in other aspects of the engagement process and what consumers think is important in making those health care decisions. rebecca, thanks for being with us and trying to put this program together. >> thanks ed for that

introduction. the national consumers league is really pleased to be here today and working in partnership with anthem and the alliance as we bring you this series of briefings focused on the consumer. we are going to be talking about empowering and engaging the consumer especially as they make choices about their health care coverage. the health care system today can often seem overwhelming and confusing for consumers. and when it comes to selecting coverage, as this slide shows consumers need to be doing a lot. they need to make sense of drug formularies, sort through co-pays and calculate out-of-pocket costs, summary of benefits and ensure they have the convenience of their providers being in network. this isn't even get to deciding on their treatments in care. we'll be talking about these issues today, as well as in the next briefing in this series in september which will focus more

on tools for consumers as they choose their health care treatments. first let's look at the context in which consumers are making these choices. where are consumers getting their coverage in today's health insurance market? as you can see in this chart in 2014, over half received insurance from their employer. 19% from medicaid. 4% individual or off the marketplace. 3% medicare. 2% military. 2% from the marketplace or exchanges. in 2014, 12% uninsured. so what are the choices that's consumers have in the health insurance marketplace under the affordable care act? you can see from these slides the number of issuers or those companies or entities providing insurance has grown. there are 25% more issuerers participating in 2015 compared

to 2015. and in 2015, consumers can choose from an average of over 40 health plans up from 30 in 2014. this really offers new opportunities for consumers to comparison shop and select the plan that best meets their needs. i want to talk about the environment for decision making in health care for consumers. in recent years there's been some trends that have really impacted this environment for consumers. so first, this huge growth in use and availability of health care information. much of this is by the internet. so our access to 24-hour a day constantly evolving information and misinformation about our health kaur options is overwhelming and can sometimes be -- both present toonts to improve our health care but can also be hazardous as well. according to a recent pew survey, 35% of u.s. adults say they have used the internet to try to figure out what medical

condition they or another person may have. what we call online diagnosis. two, there's a desire by consumers to be more in control of their health care. pasht patient engagement has been termed the new blockbuster drug of the century. patients engaged in their health care have better health outcomes and lower costs as well. this consumer involvement in more active health care decision making goes to the case of how important it is to make sure they have the tools and information they need. third, a shift of costs to consumers, to individuals in their health care costs. and, therefore, more consumer responsibility for informed choice. regarding their health benefits. this is certainly true for high deductible plans or consumer driven health plans that allow consumers to design their own benefits more. really being careful about how they spend those health care

dollars. fourth this increase in advertising noise. the average consumer in the united states is exposed to thousands of ads each day. ads about over the counter drugs, prescription medications and consequence of too much advertising is really this clutter, and it becomes harder to tract consumer attention, to hold their attention, and consumers also put up defense mechanisms in that we justice tune people out. tune information out. and fifth, another trend is this declining level of trust in institutions. including insurance companies and health care organizations which explains the skepticism consumers have when they get messages or information from certain entityies. it emphasizes them portent of developing reliable and unbiased sources of information.

we know from studies that faced with too many choices people tend to set their expectations really high and put a lot of responsibility on themselves to make sure they are making the right choice. generally, what are consumers seeking when choosing a health plan? first of all, value. they want the most coverage for premium they can afford. they want to make sure the plan covers the care their family needs, including their medications, talking into consideration their financial circumstances. they want quality information. they want information on the health plan and consumer enrollee satisfaction, including what consumers report about experiences with the doctors and health care providers in the network and customer service. consumers are also interested in quality information. specifically reporting that the specific physician level. someone with diabetes, did the doctor perform proper screening. consumers want to know what

their own out-of-pocket expenses will actually be. consumers want cost estimates for a complete surgical procedure and don't want to be surprised for added on costs later for an anesthesiologist. let's take a look at the challenges consumers face when picking health coverage, especially literacy and transparency. this slide has information from the 2006 study. engaging patients in their own health care and health care decision really relies on health literacy. that's patients ability to obtain, process and communicate basic health information and services. so only 12%, about 1 out of 10 u.s. adults have proficient health literacy according to this survey. they are able to use a table

that would calculate their cost for insurance during a calendar year. over one hf-third of u.s. adults are in the below basic or basic group and would have trouble figuring out some common health care tasks such as prescription drug label or immunization schedule. also adults over 65 had health literacy. it affects adults of all racial and ethnic groups. compaurd to privately insured, both publicly and uninsured adults had lower health literacy skills and adults living below the poverty line had poor health literacy. it can be more problematic for those entering the insurance market for the first time or have not had insurance for a while. that's the case for many enrolling in the affordable care act. 37% of enrollees did not know the amount of their deductible.

and their deductible will be really important to their budget. in some cases more important than the premium they'll pay. if people don't understand their deductible and pick a plan based on the premium they'll be in for a surprise when they start getting health care services and their deductible hits. many enrollees don't grasp some basic health insurance terms. many 60%, were not confident in some of the basic terms listed on the slide. this lack of confidence can have an impact if people don't understand what it means to pick a provider out of network. they can face some higher out-of-pocket fees. and people with lower incomes were less likely to understand key elements of insurance. people who need coverage the most may understand it the least. and then secondly, another challenge is health care transparency which joel will be talking about more too.

we want to make sure consumers have information up front about the health plans they choose. when i pick a major house appliance like a dishwasher, i can access ratings. let's make sure consumers have that for health care coverage as well. we know consumers have the ability to browse anonymously on the marketplace plans. drug formularies. we want to mack sure there's clear information on what drugs are covered, especially those wths chronic conditions. we also want to make sure consumers have reliable information on the providers in their health plans and that there's a direct link to that directory and that directory is up to date. and lastly consumers need access to prices on common medical procedures as well. what does it come don to for consumers? we can boil it don to three questions. what does the plan cover?

is the plan going to meet my health needs and the health needs of my family? how much does it cost? need to consider the monthly premium and out-of-pocket costs. is my doctor in my plan? is the hospital down the street in my plan? consumers want that for convenience. i'm going to turn it over to my other panelists. hopefully i've set the context for some of these issues consumers are facing. thank you. >> terrific. thanks rebecca. if you are watching on c-span for those of you in the room, they are not watching live on c-span but it will be on the broadcast schedule later, and on the website. if you are watching on c-span, you can find all of these slide presentations, all of the background materials on the alliance website at allhealth.org. trying to make use of that if you would like to. now we're going to turn to natalie schneider, the vice

president for consumer experience at anthem. and we've asked her to describe ways anthem and other insurance companies are trying to respond to the consumer needs rebecca was trying to sketch for us. natalie, thanks so much for coming. >> thanks. as rebecca alluded to consumers are moving pretty swiftly into the health care ecosystem. and they are the ones driving the changes we're seeing today,ed in h andtoday, ed in and it's not an incremental change. this san industry-defining pivot that's taking place. it's quite frankly causing them to issue this collective omg because rumor has it health insurance has not been particularly user friendly in the past. but there is a sense -- certainly across the sector that things are different. that we're doing business differently. and we're not taking the position that we're large enough

to sway the market. we are really, really listening and paying attention to what our consumers want. and in order to understand sort of what's driving this level of urgency and determination that i would say is rather unprecedented, we need to take a look at sort of the narrative and how that is unfolding across the health ecosystem. and the first thing is increasingly, more consumers are picking and comparing plans that didn't exist before to the tune much 87 million customers by 2018. that will be the size of the retail market. that's the lion's share of growth. secondly, we're moving more towards narrow networks and high deductible health plans which means in the past where the phonebook was really the provider network, now you are actively needing to engage if your doctor is in network and

actively compare prices. and thirdly, affordability continues to remain a persistent challenge. $22,000 for the average family of four. that's the price of in-state college tuition or a new vehicle. so they've got more skin in the game. and then we're seeing this tsunami of health care ino evacuations s -- innovations. it is empourg the consumer to take more control of their health by provideing better insights into their own path pathologist pathologist spath pathology pathology. and when we engage with uber, amazon, all these companies with 24-7 service, through channel of your source, and really great personalizeation personalization. all of this is occurring. also know that insurance

companies today sort of don't meet a lot of these expectations. if you look at our starting point for those of you that are optimists, unfortunately not third best in terms of scores, third above cable companies. we know what our strong point is. this is unsustainable in a consumer choice market. as i mentioned before, we're really beginning to make changes. if you think about how health plans are responding and how they've dealt with this problem historically. it's been this find and fix approach. we've come upon this inflection point where we need to go faster and farther and break away from this traditional mode of doing business. the way in which you create distinct distinctive, seamless consumer experiences, the type you see in hospitality or retail is through the application of hundreds of decisions carefully orchestrated

through the application of sort of the six displunans, cost strategy consumer sdundesign measurement, culture. we went out and listened to consumers and we really, really listened to 10,000 americans through focus groups and interviews to try to find out what makes them smile. what really ticks them off when it comes to health insurance. and that allowed us to coalesce around, what are the things that matter the most? and we're measuring this through customer satisfaction and through member effort. we're holding ourselves and our executives accountable. and we also discovered that what consumers want the most, and you'll see some symmetry in the remarks between rebecca and i is confidence clarity and ease. they want confidence that they'll be covered when

something bad happens. they want clarity in that they need to know what they bought and what it will cost them. and today, quite frankly, that is not the case. they want ease. and by ease they mean minimal interaction with their health plan. in fact, they don't want a relationship with the health plan that works somewhat like a utility. it should work seamlessly in the background without much mind share or sort of administrative overhead. except when an issue arises. and then they need high levels of engagement, high levels of personalization and competent responses. and why these can't be reduced to broad generalizations the interesting thing is they are more similar across statements, across medicare, medicaid group and individual than there are different. this is a very satisfying

answer. you are solving for the same things. when we interrogated the data not everything matters. in fact, you get to diminishing returns pretty quickly. there were seven critical moments that mattered the most to our customers. when you're selecting a plan by and large consumers want the decision about a health plan to be over and done with. equivalent to filing your taxes, getting a middle seat on the airplane getting a tooth extraction. they want to be separated from the gravity and responsibility of making a choice. today there are complex variables. it takes too long. it's really frustrating and it's a high anxiety event. making plan selection highly intuitive and easy is one of our plans in the next few years. once they've selected a plan they want to feel value, feel secure and they want to know

what they bought. today it's frustrating. you sort of are inundated with all this paperwork that's really complex, really frustrating. and, let's be honest, how many of us have opened up a letter from our health plan and responded, wow that was incredibly helpful and very very easy. i'm glad i read that. for the most part it's really, really complex. as rebecca said even the terminology that's being used. we're taking as an example the 40 most confusing terms. and we are recoding our digital and print efforts just to make it simple for people to understand. they don't know what a provider is, by the way. so they're streamlining the process. in terms of what's it going to cost me costs are oftenunpre unpredictable and unmanageable.

the most frustrating part is dealing with cost. 70% of them are demanding hospital prices to be posted online. so as it should be transparency cost and quality which joe will expand on, is going to become one of the most critical consumer capabilities to empower them as we move to the narrow networks and high deductible health plans. when they are faced with a medical decision they've got a chronic condition and need help staying well. they want to deal with someone that has empathy, but the nuance is they don't want a health plan to intersect that relationship with their provider. this is an area we're treading carefully. how do we diminish the hassle factor for providers and consumers in a way that we're not trying to own that relationship but trying to facilitate. and when they need urgent care

or unplanned needs. it always happened at 3:00 in the morning. this is that moment when anxiety skyrockets because they aren't using their typical pcp, and we're using our innovation lab in atlanta. this is an area a lot of people are focused on. how do we help them quickly understand what's covered and what's not? what is the most appropriate side of care that can't always default to e.r. and they need help navigating to a specific side of care. we're also working on -- to make sure a provider directory is correct so we're not having instances of people going to providers that are out of network. when you pick up your prescription, this isn't necessarily high executive, but when you think of medicare, we're trying to figure ot something that happens so frequently, how do we streamline

it and make it less hassle. and for any of you in the room that have experienced claim denial highly abrasive event. we're trying to figure out what interactions can we have with the consumer to prevent that from happening or if it does need to occur, how can we be as empathetic as possible. so we believe as health plans become more systematic and professional about the approach, they'll be able to break away from this competitive convergence that exists today and anthem in particular we think the only way, given the complexities of modern health care to treat 37 million medicare and medicaid individual and group customers is to deliver exceptionally well in an anticipatory manner with elegance. >> thanks, natalie. let me grab the clicker here.

if i can, let me just take you back to the five reasons slide, if you would. there's six. and there's -- five. the very first one the 87 million people you described as being likely to be in consumer choice segments. is that basically high deductible plans and consumer directed plans that constitute that population? >> that is primarily made up of private/public exchanges but also medicaid. what we're talking about here is in the past is employers really made those decisions on behalf of a lot of consumers. it's all instances in which the consumers are actively reviewing and selecting their plan

choices. and you think about how the membership calculus chaungenges in that situation. when 60% of the employees are satisfied, 100% will renew because the employee is making the decision. in the case of the retail market, if two-thirds are satisfied, two-thirds will renew and the rest will buy from somebody else, which is why this has got the attention of health plans. >> thank you for the clarification. next we're going to turn to joanne volt a senior research fellow for health insurance reforms. we've asked joanne to relate some of the policy issues raised by the challenges that natalie and rebecca have been talking about that face consumers as they choose a health insurance plan. nice to have you back. >> good to be here. i'm going to talk about those policy options that come out of the affordable care act.

first a tool available to everyone with private insurance and secondly some tools that are available in the marketplace for plans chosen from that. i'm going to start with a quiz thoe. by show of hands how many have seen a form like this? that's encouraging. this is the federal employee health benefit plan summary of benefits and coverage for one of the options for federal employees. i'm going to be talking a bit about this form. this is the first page of an eight-page standard form. the summary of benefits and coverage which i'll call sbc, applies to all private insurance plans. so whether you are buying as an individual in the marketplace or on your own or through your employer, you will have a

summary of benefits and coverage available to you. the goal of creating this under the affordable care act was so consumers could make apples to apples comparisons of health care options when shopping. certainly, we have a history of health plans providing summaries of their benefits, and some were quite good but they varied depending on the carrier and what they chose to cover and how they conveyed it. if you wanted to do an apples to apples comparison you would have to decipher a number of different forms until the sbc came along. you can look across the plans and see your deductible and maximum out of pocket and other things that are important to you. it must be provided upon application of coverage once you enroll. when the benefits or cost change enough that it would prompt a change in the content of the sbc

and upon request. one shortcoming of this is that third one when the benefits change enough to change the content of the sbc. there are a lot of ways your plans may change over the course of the year when you're locked in that wouldn't necessarily change the content of the sbc and you wouldn't necessarily get a heads-up that something's changed. the first page as you might have remembered seeing that's example is top line information that's probably most useful when choosing a plan, what the deductible is, what the maximum out of pocket limit is. whether you need a referral to see a specialist which may be important to know they can get to their dermatologist or podiatrist without having to make a stop at their primary care doc. on page two are common medical events. that will tell you what your cost sharing will be for various things you might pursue.

a hospitalization, doc visit, lab tests. it will tell you about your provider network, what's your costs will be depending on the tier and cost for drugs depending on the formulary tier. also coverage examples at the back which there are two now. one is for having a baby and the other is for a person with diabetes. these are only incontinued to be illustrate illustrative. it's supposed to be a high level way to compare plans and say if you are a person with diabetes to know what your cost may be under one plan versus another. it must also include a statement on minimum value and minimal essential coverage. thesere two important aca created terms. minimum value is the minimum value all plans have to meet and we'll tell you whether your employer plan meets it.

the other is minimal essential coverage which is the term applied to coverage you must have to meet the individual mandate. and finally, i wanted to share there are changes ss currently being discussed for the template that would take effect in 2017. the feds viewed a proposed change to the template and the national association of insurance commissioners is debating what some of those changes may be. and i'll talk more about some of the changes they are considering there. i will say for example, we've learned in some of our technical assistance work with navigators in some states, helping consumers enroll that the deductible was a really tough idea to get their arms around. what services they might get prior to the deductible, how the deductible was applied. has anyone ever heard of an aggregate versus non-aggregate

deductible? you have? okay. so it matters. it tells you how you pool your expenses toward your deductible if you are in a family or individual policy. that may be important if you have one high cost individual. they are also looking at changes to better defined preventive services. this is one area -- this is a hugely popular benefit. this is the idea for recommended preventive services you should be able to get them free of charge. we learned in our discussions, i'm a consumer rep there and have been participating in the discussions. helping consumers know what services they may get cost free is nearly impossible. whether or not you got charged

an office visit co-pay in con conjnks with that preventive service. whether your plan has to cover that. we found it was very difficult. this highlights some of the difficulties trying to capture accurate and complete information. i'm going to move to the marketplace and some of the tools available there. first, consumer assistance. every exchange must operate a navigator system. in state-based market places or federal partnership market places, there were additional resources to provide additional consumer assistance in in-person assisters. so we saw more consumer assistanceassist assistance funding in non-ffm states. and they outspent the ffms.

some consumers will not bible to get there on their own. we did a report providing technical assistance. for the families that qualify for financial help they can be complex lives and they're trying to fit within complex rules about availability of other coverage, whether it's medicaid or employer coverage. they may have shared households with a grandchild living in the house, fluctuating wages because thaw have three jobs that pay hourly wages and they cut back their hours during certain times of the year. some need this in-person assistance to understand what they are eligible for. certainly the literacy challenges came up from the exchange shoppers. but so the navigators had to work with that. also post-enrollment questions. they'd come back and say now how

do i use these benefits? there are funding constraints. a little more money for the ffms but they're going to try to leverage other resources including brokers and online tools to help more consumers get there without the in-person assistance. >> ffm -- >> sorry. >> it applies to? >> the federally facilitated market places. >> as opposed to -- >> state-based and the shared, the partnership states run some of the functions themselves. quickly on some of the policy tools available in the marketplace, a number of things coming online that will make it easier for consumers. a new rule all thois sbcs that get cost-sharing reductions must reflect what their cost sharing will be. if you are in a marketplace plan and have income under 250% of poverty you'd qualify for an enhanced plan that fills in some of your cost sharing.

better than plat enemy for some. almost plat enemyinum for others and better than silver for some. it's not a requirement your sbc had to show you what that cost would be which made it complicated. they are going to roll out for this next open enrollment an out-of-pocket cost calculator for consumers. similar if you look at the materials about the discussion of the fehbp tools and help you estimate your cost going forward. not just the premium but deductible and what it might look like with your office visits as well. there are going to be improvements to the provider directory and formulary. we saw experiences where consumers saw if their provider of choice was covered by a plan online to find out the directory was out of date or inaccurate. also include information imp portent for consume irs like

whether the doctor is taking new patients, their medical group they muteight be part of as well as contact information. the drug formulary must also be easily accessible from the website. be updated with each change. if there's a change in the formulary that one drug is no longer covered and shouldn't take effect until consumers can see it in the updated formulary online. it must be valuable in machine readable format to help outside vendors form it into other tools to help search for a particular provider, for example. i want to touch on one function of the marketplaces. for carriers to participate in the market place there's one function, the certification includes the exchange act in the

constran of consumers. georgetown did a report. it looked at some of the tools that state-based -- requirements placed on plans to further standardize benefits. you could look at a set of plans and know they met certain rules for cost sharing. you heard about that from the california exchange. it's this notion of a consumer might know they get three doctor visits before meeting the deductible and further refining the plans so it's easier to compare. and that's it. >> okay. thanks very much joanne. by the way we heard a lot about literacy and the challenges to it. i want to call your attention to one of the pieces in your materials. it's department of labor produced glossary which is about as simply put and clearly

written as anything i've seen on this. >> that's a companion piece to summary of benefits and coverage required to be made available. within the sbc a bunch of terms underlined or bold which means you can find it in the glossary to know what they mean. >> terrific thank you. finally we're going to hear from joe white who is the president of the council for affordable health coverage and its clear choices campaign. some of you remember joel i'm sure, from his two decades of service on the health including six years on the staff of the house ways and means committee. joel today is going to talk about cost and quality transparency including ways to help consumers and employers make more informed health care choices. thanks for joining us. >> thanks, ed. thanks for making me feel a little old today.

didn't think it had been that long. but thank you to the alliance for putting on this briefing. it's critical at this point in health care that we have this dialogue around health care transparency and the information presented to consumers as they make choices about their health plans and providers and prescription drugs. so i'm going to talk about what's going on in the marketplace right now and get into a few policy options to talk about presenting that better information. so just real quick clear choices is a multistackholder advocacy and that's why i'm talking about some of the policy options. these are some of our members. but why do we need transparency and better information in health care right now? i think unless you've been living rnd a rock health care costs are increasing. sorry for the news flash. we're estimated to spend $40 trillion over the next decade

alone. and the total cost a family is spending is increasing and at an alarming rate, we think. 18% of total family income was spent on health care in 2002. today that's about 35%. by 2030 it's going to be 60% of the typical family's income. what we're seeing on the ground right now in terms of the marketplaces is next year we're looking at an average premium across 45 states of about 12%. that's on top of a 5.4% increase in 2015. so the costs are starting to stack on the premium side. why is that important? we know that people in 2014 and 2015 made a lot of plan choice decisions based on the price. the price was the premium. they weren't generally looking at the cost sharing. the important thing that we're

seeing on the affordable care act exchanges is the cost sharing is much more than we see in the employer market. what we're seeing is higher plan cost sharing deductibles. this year the typical silver plan, which is where most consumers are signing up for an individual deductible of about 2900 bucks for a family about 5800 bucks. that compares to about $1400 on a typical employer plan. there is significant variation in both cost and quality of coverage for providers that are included on those plans. and so the confusion that a lot of consumers make is as they shop for a lower priced plan they aren't necessarily looking at, is in provider included in the directory. is the network a high quality, high value network. and the other mistake we see in the research is they equate more

expensive coverage with higher quality on the provider side. so absent good quality information on providers, people can be choosing higher cost, lower quality providers. and because this -- these costs are increasingly being shifted on to consumers, they are running this risk of choosing this lower value health coverage. so just very quickly, some of the things we're seeing in the marketplace, consumers have more information on televisions than they do on their doctors. if you have ever been to a retail setting where you are looking at the price of the tv and whipped edped ot your smartphone and gone on to amazon to compare the price. that's a real experience with televisions. next time you're in your doctor's office ask him for his

e-mail. you're more likely to get information on your television than you are to get your doctor's e-mail is the point. prices within local markets vary significantly. we see this from new york all the way to san diego and sacramento to washington d.c. it is about a 700% difference in some local markets. what we see on the health care.gov website is that a lot of times the consumer experience is that it's not user friendly. it's very difficult to compare and select a health plan off healthcare.gov. as was mentioned there are some basic rudimentary tools available on the state-becaused ed based exchanges and federal exchanges based on whether a particular drug is on a formulary, at one tier and even to compare the common name versus the scientific name.

finally, i think what we see in the marketplace is a lot of the data just isn't available to people. this is leading to a lack of tools increasing health care costs. donald burrwick has said this increases costs between $84 billion to $174 billion every year. and while $90 billion is a pretty big range, that's still a lot of money even here in washington, d.c. so in terms of the goals, what we have been able to divide through our stakeholder groups is there are three core issues that i think we need to satisfy to make an effective system for consumer choices. the first is we need better data. basically, to measure the right things, and we need to understand what consumers value in order to empower them in making choices. they can only make choices through better tools.

so these are improved health plan websites and improved out-of-pocket cost calculators. better tools lead to better data and better tools lead to better markets. if we see a better operating markets, we think people will have additional choices that will help address some of the cost issues we're seeing. so if i can drill down into some of those issues there, the first on the better and more data is that what we're seeing through hhs is really a lot of data dumping. it's being dumped out there without a lot of context. and so people get confused just by the data cms is releasing. for example earlier this year was a release of physician claims data. the thought being i would get online and search my provider and see how many claims he was responsible for, the cost of that provider. the media picked up on this and a lot of it was gotcha

journalism. my provider is the most costly because they prescribe the most costly drugs, for example. that's not necessarily helpful to a say, my provider does the most hip replacements and, therefore s an expert at doing hip replacements. so, we need to put this data into context, which means that hhs really needs a strategic framework for the information that it's releasing. the second thing that we know consumers really value is this cost quality equation. in other words, the value equation. right now we don't have very good measures of quality. so, the information that could be presented on some of these help plan comparison websites just simply isn't available. we're measuring the wrong things and things consumers don't necessarily find helpful. for example, most of the measures used in federal programs right now are measures of underuse. did i perform the mammography on the preventive screen? did i do some other preventive

measures? it doesn't measure overuse or misuse. did i prescribe an antibiotic, for example, for a viral infection? some of those types of quality measures are absolutely critical to consumers to -- because they get at the core competency of the provider. then finally we know big data is kind of a catchism but the more data that we have in the system, the better, more granular insights we can make. right now congress passed an sgr law earlier this year, but right now we know hhs is going to find it very difficult to double the amount of claims data in the system because medicaid and c.h.i.p. data is not standardized at the state level. we need to standardize that data and put it to use at the federal level so that consumers can use that information to make better choices. switching over to better tools, one of the thimpkngs that we think is absolutely critical, and we took a look across the cms plan

comparison websites and we also looked at healthcare.gov and we looked at a number of the state-based exchanges and we're going to be released a paper on best practices for plan comparisons this fall, which will include a number of consumer focus groups and what consumers actually value in making plan selections. and i think what we found was a little disturbing. a lot of the websites don't present accurate information and they don't present it in plain english. it's very hard to select a plan on a website where you're trying to make an honest comparison. if there are loaded terms, jargon-based terms that are being used you know, we've heard today some people don't even understand a deductible. we've got to get better at presenting this information in plain english. from our perspective, the initial research we've done, there are three primary things i

think consumers value. the first is the searchable integrated provider directory and formulary, as has been discussed by all of our panelists here. it's absolutely critical to know whether or not your provider's in network or not in network. it's absolutely critical to know if your drug is covered by the form formulary, on what tier and to know that information based on its plain english name not its scientific name. if your provider is not in the plan sxru to go out of network that adds to your cost sharing. not only that, it doesn't count against your annual limit. so, it has a negative financial impact on the consumer. the second thing is there has to be a smart comparative display. i need to be able to match up my anthem plan with my etnaaetna plan to make an apples to apples

across cost sharing, premiums and covered benefits as well as the providers and the formularies. what we're not seeing on some of the exchange websites certainly, and on healthcare.gov is those good, smart comparative tools that empower of the consumers. and then finally, something that came under a lot of criticism but that consumers really value and makes a heck of a lot of sense is we need to allow people to window shop. we need to allow them to compare those plans before they have to actually log in, get a user name or sign up for a plan and commit money financially. doing those three things, we think, would vastly improve the consumer experience in the marketplace. would also vastly improve and continue to bring down the number of uninsured. it's a better match for plans, better match for consumers that we think ultimately will lower health care costs. thank you, ed, for having me. >> great. thanks very much, joel.

we'll now get a chance to get into an interchange. we have microphones that you can use to go to and ask questions in your very own voice or you can pull out that green can card, write something on it and hold it up and somebody will bring it forward. and i want to get us started here actually, with what joel was talking about. in the way the steps that could be taken if the regulators and the people who run the marketplaces were to be able to do them or were required to do them. i wonder if the private sector is doing in its segment where it is controlling, whether it's -- in dealing with imprrz or private exchanges are they moving in this direction any

faster than the government seems to be doing? joel? >> the simple answer is yes. what we're seeing is a lot of innovation at the plan level. what we saw in '14 and '15 was a lot of competition, like i said, on the price. i think a lot of the plans, natalie could probably speak to this better than i could, a lot of what they're seeing is they need to have the customer service component where they're attracting people and saying, we got to get a better fit here. it's not just the consumer who's harmed -- not harmed but it's not just the consumer who if they sign up for the wrong plan, their provider is not in the network or their drug's not on the formulary, that doesn't just impact the consumer, it affects the plan. the plan has to deal with an exceptions process appeals process and not having a good fit for that individual. so having this information, i think, better matches up consumers to the right plan. what we're seeing is some acceleration around innovation

around plan tools in the marketplace but not yet on the exchanges. >> rebecca, you want to comment on that? or natalie or both. >> no i would agree. it's to everyone's benefit that the consumer is able to pick the plan that best fits their need. i think the challenge, and natalie you can talk about this some more, is how do you do that. so that all consumers can really have that information and match it up accordingly. without really being able to predict the future too. we've been talking here about how consumers choose their health coverage but we always need to remember that's one small step in their health care coverage. they want to pick their insurance and be done with it, but how can we make that experience the most productive it can be. >> we found by and large, consumers have absolutely no

idea what they've purchased. and we have verbatims from the focus groups and interviews that in some instances people are using eeni-meeny-miny-mo. we know affordable is still king. a lot of people are buying on price but without fully comprehending what the implications are with respect to co-pays, deductibles and all those types of things, so that remains the most significant challenge to overcome. >> one of the things -- your question about whether -- what employers might have been doing. i know one of your members is pacific business group on health, they've had a tool for a while that allows consumers to estimate their out-of-pocket costs. we use it at georgetown. it, like the one for the federal employees and like the one being contemplated by the feds, still requires consumers to sort of place themselves as low, medium or high health care utilizer.

it's a very rough estimate and it's difficult to again predict the future. even if you have a planned event, like you know you want to get pregnant later in the year, if it turns out to be a complicate the pregnancy, that will cost you more than you anticipated. even if you're a person with a chronic condition like diabetes and you generally know how many doc visits you're going to need or what drugs you'll take on a regular basis, you don't know what else is coming down the pike. so, i don't want to oversell these tools. i mean they're useful as a way to sort of ballpark things and help consumers shop and compare, but it's still a very rough estimate because health care by its nature is sort of an unknown in the year ahead. >> for those planned events, and joel spoke about this, just the huge variation in price with no discernible difference in quality. we know, for example, that nic mris will raise from $2,000 to a tenth that amount. while there's predictability in the cost, there are instances where we can really come very

far along in terms of helping people estimate costs and sort of partake in the economics of smart decision-making. >> i just have one more thing. that's just about this whole issue when we talk about consumers of choice architecture design. it's really how we present this information to consumers. there's been some studies consumers will go with the default, so we really have to see how we're presenting the cost information. so, careful thought needs to be put into that. >> very good. thank you. >> we have a lot of folks lined up. we would ask you to be as brief as you can in stating your question. and before that, state your name and affiliation, if you have one. >> hi. my name is steve spitz. i have two related questions on costs. one, i had an experience in a hospital where they said i needed certain