manpower, and are the british armed forces going to fundally have to grow? mine. what does that tell the united states as the united states looks to trade away manpower? >> well, in addition to that big, long, expensive list, a kit that's in our manifesto commitments, we've made commitments on manning as well, on the size of the army, on the full trained strength deployable part of our army. as i've said in my speech, this is a huge focus for the sdsr. the main challenges lie in this space. it's not just numbers. in a way, the numbers are not the problem. the navy, for example, is doing -- it's way ahead of its recruitment targets. use of reserve forces, that is now, after a shaky start, is

doing really well. the problem is around certain skill sets and trades we need. >> like marine engineers. >> absolutely. and those working in the nuclear field as well. and that's not just a defense problem.9wjé it's a national problem. so there's a cross-government approach to that to really encourage people to go into those trades, to incentivize them to spend some of their career in the armed forces. not necessarily all of it. with the new employment model, which is removing some of the reasons why people don't find service life attractive, we are also introducing more flexibility in someone's career pathway. so they don't necessarily have to be in the armed forces all the time. they can move in and out of the private sector.

so we're tackling this in a number of ways. but this is, you know, for me, this is one of the key tasks the secretary of state has given me and for each of those pinch points, we have a very clear plan, which is being addressed by more than just my department. >> do you -- what do you see, b) you know, there are those americans who look at the british system and actually have seen significantly greater flexibility perhaps than we've seen from our own system, especially in how you can employ manpower, which you do with direct commissions, for example, for very talented people you need to plug a hole in. what are some of the things you think the united states can benefit from as it drafts its forces of the future by looking at britain? and what are some of the elements that perhaps we're work and doing that you think could be important to sort of revamp your military manpower management model? >> well, i sat down yesterday with each of the services here, and actually, we're very, very close in terms of the ideas and

the initiatives that we are rolling out. the breaks on that for each of us are different. we are at the start of our parliamentary session.üfñ we have five years in order to, you know, run at this. and we want to make very quick progress. but it is really about -- i mean, just some of the common themes are retaining women in our armed forces and showing they can have fall career. allowing more flexible and part-time working. so it's not just reserves and regulars, but you have a part-time work force as well. and it's providing incentives and looking at someone's aspirations and their whole family. so one of the things we're particularly focused on is spousal employment.

doesn't matter how good the offer is to the serviceman or woman, if their other half can't get employment where they're going -- >> it's not the 1950s anymore. >> no, we have to move on. so there are some great common themes that i'm really keen we stay in regular touch, that we share information and ideas. there are tremendous opportunities that lie ahead if we get this right. >> you talked about expanding 7ñ opportunities for women. you are the first female armed forces minister. in the united states, some of these barriers are breaking down. you mentioned it in your speech. the first two female rangers have graduated in their class. the pipeline will remain open. the chief of naval operations as well as special warfare chiefs

said we're going through an objective process right now. we don't see any reason why women wouldn't be able to do s.e.a.l. training. what about in the u.k.? a lot of these fields -- your dad was a paratrooper. what is the game plan that you're bringing this to open some of these communities to women? >> well, there are very few roles that are actually closed off to women still. we have women submariners. we've made good progress in that respect in recent years. but we are looking, as you are, at infantry and armor. one of the things that we're particularly looking at, we have looked at can women make the grade, can women get through training, why we should be doing this. one of the issues that has come out of that initial research that we are now following up on is not just can women get into these trades. it's can a woman enjoy at least the average career in these particular areas without being broken. and we're doing research into that and looking what we would need to do in order for them to do that.

>> and to retain enough to be able to make command at some point, right. >> exactly. because otherwise it's not going to be an attractive career, i think, to the sorts of people that would wish to do this. i think there are great opportunities in that for the fellas as well as the women. we ask a huge amount from these people. they put themselves through the mill and sustain injuries. i think we can, both of us, the u.k. and u.s., can do a lot more in ensuring that people are -- they have better fitness advice, that we're trying to mitigate those injuries as much as possible. so i think a by-product of this whole process is that we will have better advice for people,

whether they're preparing to go and try and qualify for these trades or whether it's looking after them as they go through % it. i think we see great merits in opening up these trades to women, but whatever we do, it has to be evidence based. so we're going through that work at the moment. >> one last thing before i open it up to the public -- to the audience for questions. do you -- you mentioned, for example, that there's a debate in the united states about the gap between those who serve and don't, between the 1% and the 9g 99%, and that there is a civil military gap that's emerged. part of it, i think, especially for wounded veterans, for example, is an overwhelming i didn't have to go do this, they did. but this is also sort of a long-term challenge for care for

veterans. how do you put this in the broader context? the united kingdom, given its rich military heritage and the military being in many, many facets of life and permeating into it, you would think that bond would in some cases be stronger. but what are some of the fundamental things that have to happen to reduce that gap between those who serve and don't? percentage wise, it's almost identical for you as it is in the united states. how do you do this? is it more ways to serve to attract people? what are some of the things you think are the right model to solve that issue? >> well, i think, as i mentioned in my speech, the starting point is to really create that understanding about what -- in the very rapidly changing world we operate in, what are our armed forces there to do and to get communities to feel ownership of their armed forces.

there are a number of initiatives that we're doing to address that, but fundamentally, political leaders have to articulate what they're for, what we're doing. i think that as we leave afghanistan and as we change to less high-profile operations, hopefully with less casualties, that we need to keep the public focus on our armed forces and explain what they're doing. when we had the high rate of casualties that were coming back from afghanistan, there was a tremendous outpouring of support from the public, huge amounts of money donated to care for veterans and organizations like help for heroes. one of the concerns that certainly we had on the defense committee at the time was how sustainable were some of these things if -- when the spotlight is then off that activity. >> 10, 15 years from now. >> yeah, and what's the legacy of that.

so i think we did a good job of really addressing situations and when facilities were being built, really questioning what's the long-term plan for that to be sustained. so i think we were on to that very quickly. but the armed forces covenant, i think, is probably the most powerful vehicle that we have. it's very new. but it is having an effect. it is changing behavior. so i remember actually it was the first engagement i had. when i was starting to run for office, i went to see one of our veterans organizations. a continual theme from veterans was when they went to the local authority to ask for assistance with buying some new -- a new fridge or a cooker, that they were -- as soon as it was discovered they were a veteran, they were sent to the british legion. it's no longer acceptable for

local authorities to do that. if you have served, you cannot be disadvantaged in any way. so it's changing behavior in local authorities and institutions, in business, as k there's a few carrots in there as well. i think through that, and that's being developed and progressed and we're learning very much from what you're doing over here, i think we will create that link. we will create that narrative and develop it so it's about our armed forces today. i think just finally, there's some great initiatives from veterans themselves. there's a new initiative called i am a veteran, which is really dispelling some of the myths around our veteran community that they're all fragile or all suffering from mental illness or all on the streets homeless. there are clearly individuals

who have problems, and we need to be there to take care of that, but that's not representative of veterans. >> no more or less than the broader community at large. questions from the audience? when who continues to heal at an alarming pace. >> i'm a senior adviser here. also a former royal naval person. served in a sister ship to the one i'm told you're named for. minister, my question has to do with some of the betts on which your future defense is really based. obviously, you've got f-35 carrier replacement and trident replacement, but on the side of the army you have a big bet about the reserves, whether they can fill these holes. then you have two brilliantly innovative ideas. i wonder if you could comment about how the reserve is progressing and filling these holes and how you see the progress and what you hope to get out of first isr brigade and 77 brigade.

>> things are -- i mean, in comparison to the numbers we have fielded before in reserves, this is fairly conservative stuff. it's always the small things that mess things up. we had -- when we initially started to recruit and have the uplift into our forces, there were glitches. the admin didn't work, all of that. that's all been ironed out now. we are getting people, not just through the door, but through training quicker. and, you know, the navy are doing very well and ahead of the curve. the army clearly has much bigger challenges, but it is doing well, and it is ahead of its targets at the moment. but we need to constantly be, you know, looking at doing things differently, and we

are -- we've brought in some very innovative initiatives to speed the whole process up. so rather than someone having to apply for their board and then apply for their medical and this all take a long time, they just go away for the weekend or a week and they get all the admin done. just very simple things that smooth the path through. one of the experiences that i've had is that i've actually been through all of my officer training as a member of parliament. at the time when this uplift was happening. so i've actually been through and witnessed the change in the quality of what's being done. it is very dramatic. also, the cultural change that's happening. so i was on this second only court at dartmouth that was nñ fully integrated between regular

reserve and auxiliary as well. you get people transitioning between the three. so huge amount being done. i should say also by a small group of people who have worked extremely hard to get all that to happen. we are facing, you know, massive challenges in other areas of defense as well. and we are going to have to do more with what we've got. the reserves are absolutely fundamental and key to enabling that to happen. and that's not just, you know, a way of keeping the numbers up. it's also how each individual service is going to use them. and in terms of developing that as well -- as i mentioned

before, part-time working as well, i think that will help us dramatically fill some of these skills gaps. and i think it is a very exciting time to be going into those services right now. [ inaudible question ]. >> in terms of your concerns about -- >> whether that's going to be able to fulfill the task -- [ inaudible ]. >> in terms of use of reserves? >> no, no, no. [ inaudible ]. >> a great deal of my role is spent looking at grids with red blobs on them to say where our pinch points are. in fact, all of that management information wasn't there five years ago. so we know -- you know, i can tell you where headaches are not just today but actually years from now.

so we have challenges, but we know where the problems are and we have a strategy to address them. so i'm very confident about our ability to do these things. >> young lady right here. >> thank you. esther bremmer. george washington university and previously at the state department. i'd like to go back to the strategy and the thinking underpinning the current review and particularly ask you about one of the great principles obviously associated with the united kingdom and united states, freedom of navigation and freedom of the seas. we see a return to competition whether we're talking about the arctic or the south china sea. how are you thinking particularly about maintaining this principle and what it means for deployment and how will that underpin your approach to the review? thank you, madam minister. >> when i got into office, i had to -- i was wearing a purple dress, i think, when i addressed the m.o.d. for the first time, but it is no secret that this is a subject close to my heart as i'm an rnr officer. i think that one of the challenges that we have, i

think, not so much with those that are very close to the review, but with the wider stakeholders and in particular parliamentarians is to keep them focused on these more traditional bread-and-butter issues of defense. we are a maritime nation. if those pinch points are closed in a few days, we will be in 90% of everything that we -- you know, uses fuel, as goods, is brought to the u.k. by sea. so this is an absolute priority for us. part of this -- and to really strengthen the ability of the royal navy, which is absolutely fundamental, is not only that we, you know, have the right platforms and that they are --

it's not just numbers but the kind of technology that we're really investing in, which keeps us relevant to you, it is also that we have -- we're able to drive down the costs of producing those platforms. one of the key questions as we go into the sdsr is about that sovereign capability. we have announced our ship build strategy, for example, and we wanted to ensure we have realistic drum beats for our shipyards. i've spent a lot of my parliamentary career educating my colleagues about the mission of the navy and what we need to enable it to have the reach that we need. there has been a move towards much more closer working with other maritime organizations. it is a big sea, and we need,

you know, other eyes are on ensuring that it is policed and it is -- those trade routes are open. then we want to encourage that. i think we have seen a shift in where those concerns are. certainly for us in the last five years, there is less concern about piracy than there has been previously because of the strategies that we've been working on in certain parts of the world. but, you know, it is a challenge for our navy in terms of what it has to do with what it's got at the moment. the big step change for us is when our carriers are back in. they're going to be based in my constituency. the first ship will come in, in about a year's time. but that will be a massive boost. >> there's one follow-up i want to make on that.

you know, i'm a big fan of leanders. the surface force was large enough to have a global presence capability. instead, the u.k. has steadily traded away numbers to move to the highest end and now it looks like the frigate force could be as small as ten. i know that's under review, so i should look at your eyes for any signs. the lucky 13, which sir george is very happy about. then there's counting opvs against the numbers and things like that. at some point, is there a recognition that, a, you need a more sort of tiered force a little more like how the french have, which have open-ocean ships which are good for piracy but aren't at the highest end of capable, or simply have to

invest more as a maritime nation as opposed to shrinking sort of six large, you know, destroyers of the daring class and 13 of these ships and a couple opvs. right now you realize even with the type 23 force that are very capable and extremely high availability, those ships are running incessantly at this point. >> i think that there are clearly two schools of thought. do you try and go for reach and have more opvs, having more of a presence, or do you invest in what are probably the most expensive warships in the world. we have done the latter because the capability the type 46 will bring. these are the most sophisticated warships in the world. you can buy a frigate for half the price that our type 26s are going to cost us. but it is that capability that makes our navy great. and we have made a conscious decision to invest in that. where we can build more hulls and we can obviously man them, we do save. so actually in the last sdsr, we have managed since then to

squeeze three more warships out of the defense budget, so we're building three ocean patrol vessels, which again are more capable ships. they will replace some hulls eventually, but they are just more capable platforms. so for us, the capability is absolutely key. and it is -- if there is a choice, we will go for that. >> yes, ma'am? >> i'm the associate director of wiau in kiev, ukraine. thank you very much for being here today. you've spoke to the public

opinion in the u.k. regarding the military and its involvement around the world, particularly you cited afghanistan and iraq. here in the u.s., of course public opinion is we hear so much of the u.s. leading in efforts around the world. we know our u.k. is a strong partner. where could you particularly define the u.k. as leading with the u.s. partnering in efforts that the u.k. has either taken initiative for or has intent to take initiative for? thank you very much. >> well, i think -- i mean, we clearly have common objectives. i think you would be hard pushed to find something that we, you know -- we didn't both have a stake in or were increasing our activity in. i think one of the things that the u.k. has really pushed and led on, particularly under william hague's stewardship as foreign secretary, is on women,

peace, and security and on building capacity and providing training to other armed forces. we very much see that as a larger part of our future role. it links into other initiatives we've taken in government around obviously protecting defense spending, but we are also protecting actually in law spending on international development. because we see that as part of the curve that we need to make the world a safer place. we're doing a tremendous amount of activity in there. one of the areas that i am really keen on pushing is that

as we're going to do more training of forces around the world, we are tagging into that training around sexual violence and conflict and about women, peace, and security. so i think that's something that we should be very proud of. i think -- i don't know enough about what other nations are doing per se on that to grade us in comparison to that. i know the u.s. is doing a tremendous amount on that. but i think we are leading the charge on some things. one thing that is very important to us and we know is important to you as well is that we are able to act independently. our prime minister has, you know, he's stuck his neck out on a number of issues, libya being one of them, under the coalition government. we always want to be able to do that. but we are very pleased to work shoulder to shoulder with you on a whole raft of issues. >> yes? >> hi, i'm mckayla.

i'm here with boston university d.c. programs. i was wondering if you could talk a little bit about how we can learn from some of the mistakes we may have made in ike and afghanistan and how we can learn from those in our work to kind of help the local forces fight against isil. >> thank you. we have a generation of leaders in our armed forces who have an enormous amount of combat experience, and we would be really stupid if we didn't listen to them. i think that we have done that, whether it has been through formal inquiries -- i was involved in looking into what happened in afghanistan, particularly with our forces around 2006, and i think we have

a very good understanding of the things that went right and the things that didn't go quite so well. i think we are demonstrating that we have learned those lessons now in how we are approaching the situation with isil. we have to build capacity in local forces. we have to allow them to lead that fight. and i think we are demonstrating that. it is frustrating. it takes longer. but it is absolutely necessary. i think as well the -- i mean, sometimes there are criticisms of those local forces. i think they are doing a tremendous job. they're incredibly brave. their commanders really do have to lead from the front. as a consequence, they suffer more casualties to their military leadership. it is a tough fight, but we are

there doing what we need to do to enable them to win that. i had the great privilege of when i was visiting cyprus talking to some of our armed forces who are acting as trainers and mentors to these local forces. it is a great experience for our own people in being able to do that. and it will have a lasting effect. what we need to ensure is that as we're pushing isil back and as we defeat them, and we will defeat them, that there is not then a vacuum for something else to emerge. we have really got to deepen our understanding of the local situation, and we have got to do everything we can to support that wherever it is in the world a political settlement in these ungoverned spaces. i think we have learned the lessons, but we should always

keep them in mind. >> i'm working my way to the back.g2ay so if i could go here to this gentleman. >> hi. i run a small consulting firm, ts light, retired army special forces officer by trade. just sort of, if you could comment for me on the british special operations forces and sort of their capability with the declining personnel numbers from the bottom of the pyramid and also my second question would be when is selection taking women for sas? >> well, my line to take on special forces is that i don't comment on special forces. >> you mean they exist? what? what madness. >> i can confirm they exist. but i mean, i think that we do ask a lot of that capability. for us in the sdsr, it will be a huge focus in what we do. i am -- well, we'll have to wait and see. we'll be driven by the evidence

of our review. again, we're looking at infantry and armor. but who knows what the future will bring. i'm sorry i'm not able to give you any more detail on sf. but it certainly -- i think one of the major issues that we'll be looking at in the defense review. >> right there. >> yes, i'm russell king, retired federal employee. minister, i'm sure you know that in budapest, there's a problem with migrants at the train station. britain's been criticized for not taking enough of these migrants, but there are criminal smuggling rings that move migrants from one place to another. i know also from libya that i think the migrants from there came from subis a har ra africa and they went thousands of miles

across many borders through deserts. there are sophisticated smuggling rings. what is the military role? i know we're talking about human shielding. i know you don't want to kill innocent migrants, but what is the role of the military along the smuggling routes of illegal aliens? >> well, i think the first thing i need to say is about the role that the u.k. has played in trying to address the humanitarian crisis that has been caused by what's happening in syria and north africa. the u.k. has made huge contribution to humanitarian relief. i think we are the second largest contributor to that. the amount we have given as a government in aid relief to syria let alone what the british public themselves have paid i think is larger than russia's entire aid budget. it's a huge amount. and we have made a conscious decision to address the humanitarian crisis there, taking some people but those

people who are most vulnerable, who might have a disability or illness, taking them to the u.k. but the notion that if we just increase the number of people we're actually taking into the u.k., we're going to have an impact on these desperate situations is fantasy. we need to help enormous numbers of people and actually assisting countries like jordan, putting money in at the local level is the best way we can do that. as well as taking some -- those most vulnerable and those most at need. we have as well got to be mindful that we must try and remove every incentive to these smuggling gangs. we have been taking a real lead in combatting that criminal activity in the mediterranean,

and we have -- it is a huge challenge to europe. each country is governed by its own rules about what they can do and what action they can take, for example, to sink a vessel, for example. to have actually a concerted and joined up effort in terms of tackling those organized crime gangs and having a consistent strategy in doing that. we believe that we've got to shut down those incentives, and we also believe that actually some of those countries in north africa whose economy is doing well, that is the best place for people to be sent and to be looked after. but it is a very immediate challenge for europe as well as

the other sort of strategic issues we have to consider. an emerging, aggressive russia, for example. this is front and center, requiring action now. we are doing that. we have deployed naval assets. saving thousands and thousands of lives. so we are very much a player many that. but unless we really tackle the underlying problems as to why so many people are being displaced, which we are doing, making a huge contribution to those operations and tackling isil, and unless we really tackle the smuggling gangs, that's always been our line, we are not going to solve this. it's not just about taking refugees. >> i'm an active duty captain in

the u.s. army. perhaps fittingly i saw today that for the first time a brigadier general in our army was selected to be a deputy commander in the u.k., third division. what value do you see in a partnership like that, and do you think that will continue and work both ways? >> i think it will. i mean, the relationship our armed forces have, there is no comparison. our offices go on each other's courses. i've had the huge privilege in the short time i've been in office to just see how closely and particular in certain trades, in intelligence and cyber, how closely we work together. we're very used to this. i think we will continue to see

that greater integration. as i mentioned in my speech, that interoperability. and there is -- there's great aefection between our armed forces as well. people have worked with each other. they know each other. they trust each other. and that is why we need to continue to invest in our people as well as k.i.t. that's what makes the relationship so special. so i think we'll see more of that. >> just a quick relationship question. oh, did you have something? well, a quick relationship question. there have been some in the pentagon who have voiced some concern about the shrinkage of the u.k. armed forces. what -- you know, there were some people who were saying the special relationship is with france and that's changing because the french have become somewhat more active, which i know that irritated some people in london, but i don't think it was intended that way. how do you respond to that question and that challenge in the u.s. when there are some observers who have shared these

experiences over time, over decades in careers that have crossed paths but ultimately also tend to look and say, boy, you guys really are getting very small ultimately in some respects. that then also doesn't -- you know, there are british friends of mine in uniform who say our vision is bigger than we are, but if we don't keep that big vision and sense of ourselves, that's when we'll get in trouble. how do you address that? >> i would say a number of tough things. at a time when our government departments have been asked by our chancellor to find 40% cuts in their budgets, we have protected our defense budget. so it's not just the nato commitment. we're growing the defense budget year on year, real term increases. against a backdrop of pretty, you know, desperate situation and requiring our other government departments to do more heavy lifting.

so increasing the defense budget, i think, should sends a very clear signal to the u.s. from the u.k. that we are serious about this. i think as well, we need to have some discussions around how the u.s. can help itself by helping us. so i mentioned before in answer to this lady's question about our industrial base, we buy things from the u.s. we would love the u.s. to buy more things from us and to help us. reduce our own costs. things that we are genuinely innovative at and that would benefit and be better -- >> a better two-way street. >> exactly. so i think we have a good enough relationship to have those conversations and not fall out. but you know, i think we need some challenge there as well. and we are -- as i said, we invest, in particular k.i.t., that is relative to you.

our 45s make our navy relevant to the u.s. we could have lots of other platforms, but we have chosen to buy billion-pound warships because it makes us relevant to the u.s. >> with very impressive capabilities. yes, fran. >> fran burwell, the atlantic council. two questions. as you head into this review, what are the types of scenarios you're looking at? you've mentioned maritime. you have mentioned still wanting -- do you still see yourself as having a global role? it seems to me that many european countries, including the u.k., are confronted with so many regional emergencies. it's hard enough to respond to those. at the wales summit, we saw an increasing emphasis on almost a

return to defense of the east, and we're likely to see even more of that in the lead up to the warsaw summit, at least in what the host country is going to be asking for. how do you see -- what types of difference scenarios do you think that you will base -- have to base this review on or look at, reflect on, as you look at the review, and how global are they? then to return to the gentleman's question about women and the sas, you can't talk about that too specifically, but can you say whether the recent success of our women in getting through the training has changed or affected the debate at all in the u.k.? >> thank you. well, to the first point, there are several things i would say. first of all, as i said before, we are in the very early phases of our defense review, but our planning assumptions reflect the issues that you raise.

so it's about those local crises. it's about the contribution that defense makes to international humanitarian crisis and natural disasters, and it's about the u.k.'s own resilience. those things, although we've always done a lot of that kind of stuff, have not really been front and center in the defense planning assumptions in the last sdsr. so the assumptions we're working on now reflect reality. i think the challenges are not so much what are the scenarios that we are focused on or that we can speculate on, which regions of the world, the sorts of threats that we can see emerging. and can we predict what's going to happen. we know from our previous defense reviews that you can't

predict what's going to happen. that's for sure. i think the main challenge in the review going forward is trying to be prepared and enable the kind of capabilities for situations which we can't imagine. the direction that warfare is going in is changing. we are going to have to do -- develop capabilities that currently we don't have an idea about. so the obvious one is in cyber. we have to enable those working in that field to have the flexibility in how our budgets are planned to create and adapt capability to combat very fast-moving and changing threats. and that is one of the great strengths about our countries and how closely we work in those fields that we have people literally sat next to each other

working on those problems we. we don't have to have a summit every six months to look at that because actually that's too late. so that's a great strength that the relationship has, and that, i think, is the challenge in the kinds of scenarios we're going to have to be combatting in the near future. i think that to your second point, the short answer is yes, absolutely. the fact that two women have got through that course doesn't necessarily dramatically enrich the data that we have that's driving our research and strengthening our evidence base. what it does do, and i think this is really important, is that those women are role models, that women who might aspire to go into the service or who are in our services at the moment can really start to think

about what they want to do with their career. and think about what roles might be open to them. once certain fields are open to them, then they might raise their aspirations about the kind of career they aspire to, command roles, and all sorts of possibilities open up for them. so i think those things are important. it's absolutely right that we celebrate that and we acknowledge that. and one thing that i'm very keen that i lever for, for the u.k., is the very large number of women role models that the u.s. military has. it's great to see a female admiral in our main building because it really does help our own women raise their expectations and aspirations,

and as long as they carry on doing that, we will run to keep up. >> yes, ma'am, the lady there in the blue. >> thank you. sputnik international news. a question on russia. there was a think tank proposal released yesterday. british think tank suggesting that u.k. troops should be stationed in eastern europe and specifically in the baltic countries. i'd like to get your thoughts, what you think about that proposal and then also the british stance toward russia. >> well, this -- although this doesn't necessarily get the media attention that some of the other threats we are focused on

and considering in the defense review, counterterrorism being, i suppose, the most focused on, we are extremely focused on what russia is doing. there is a huge amount of concern about an increasingly aggressive russia and that she is changing her behavior. so i've heard it mentioned that people think we're perhaps less focused on that, than on some of the other issues, but i can assure you that's not the case. i'm not able to talk about those aspects of the defense review because we are not at that stage in the defense review. but we very much -- and we're demonstrating it in our actions. we'll honor all of our obligations in nato. we have been very clear on that.

>> yes, sir. right next to you. >> hi. i head up an energy research nonprofit called urban cruise ship. my question for you is where is the u.k. and the u.s. on cyber security, and where do we need to be? >> i think this is one of the most challenging areas that we face, in part because of the pace that things move at. and the challenges are considerable. i think we're in a very good place, and i think we are in a good place because we are absolutely integrated in what we're doing. we have some great people. as i said in a previous answer, we're working very closely. we have people, you know, literally their desks are next door to each other.

so what we need to do is enable those -- absolutely the right people to be able to have the flexibility in what they're doing to develop defensive or offensive cyber. that is one of the challenges to, you know, us as politicians, is to ensure that, you know, we're not wedded to old-fashioned planning cycles, that we can enable them to be as nimble as we need them to be. i think the other key issue that will help us is we've come sort of full circle is back to some of the reforms we're doing about what it is to have a career, whether it's in the armed forces or whether it's as a civilian that is supporting defense. we need to attract people that perhaps haven't traditionally thought this is a career for them. and there are some great

initiatives that we're doing and i know that you are doing as well that enable that to happen. but we have really good people. they're very focused on that. i have been very encouraged in the short time i've been in office about meeting that challenge. i think it is a top priority. certainly when i was on the defense committee, i think it was the only report we ever sent directly to the prime minister at the time. but this is -- there was huge emphasis on this. i'm very glad it's in my portfolio. >> any additional questions? yes? >> law 360. i was just wondering if you could talk going off of cyber security about not just within

the armed forces but also cross government and also cross sector steps that need to be taken to ensure national security. >> in the cyber issue. oh, god. how long have you got? >> we can stay all evening, actually. >> i mean, in cyber, defense play a part in that, but it is actually owned cross government by the cabinet office. and a huge amount of work is done by them in driving this agenda. it is -- i think that we have gone through a massive change over the last few years in how this is seen as a priority in other government departments. without sort of going into the nitty-gritty detail of the sorts of capabilities we're developing, i don't think there's much more i can say other than we need to ensure that the resources is put behind

this. and that we have the right people working and happy to work for their country. i think that there are all sorts of other aspects which are not on the public's radar about space weather and bizarre natural events which we need to be focused on in ensuring our resilience, but this is a top priority for us. and i can assure you that it's not just defense that are spending the time they need to on it. >> let me ask you kind of a -- sort of a broader question. you talked about sort of what the international community has

to do, for example with the migrant issue is tied to syria. that in extent is tied to what's happening with isis. on many of these things, it seems the international community doesn't necessarily -- as you said, it's going to take a long time to solve that. do we need -- and i know there are some people at the atlantic council who have been spending a lot of time thinking about that, whether it's fundamentally unstable so the stability isn't something we're actually seeking. do -- are we in an era where there are going to be these persistent, long-standing crises where there will be large displacements of people for example, a migrant crisis, and that's going to be the stage of place for an extended period of time. nobody really knows what to do about them aside from, you know, try to help the indigenous folks

try to help these battle. and the indigenous folks are not as motivated as we think they ought to be in engaging these problems. >> i would be more optimistic than that. while we are dealing with the fight against isil and these very immediate and high profile operations, we are also heading off trouble elsewhere, so you know, a large part of what we are doing is about training missions and it's about insuring that isil and other organizations don't get a foothold in other nations, and it's about not just what our military can do and it's about aid budget and enabling unsupporting fledgeling economies. once we are at the intervention stage in terms of our military, that is poor value for what money we've got. so as well as doing these things

and the uk, we are small compared to other nations but we are involved in a huge number of operations to do that. so that's the first thing. the second thing is, i think we are in this for the long haul. it's in our national interests to insure that we have peace in these parts of the world. just taking the middle east, one of the things that we have done in the, you know, the first few weeks of this government is produce our gulf strategy.

the first visit that i did, i don't know how many weeks into my role was to go to bahrain and open up our new mcc base there, and to progress us having a -- >> first time you are back east of the suez in a while? >> on a warship. but, you know, that is the direction of travel for us. we always have sort of joked about barring that we have been there for decades but on a kind of annual review, and now we're really putting down roots, and we're taking illustriouses out to the gate and we have a permanent base there and we are working hard even though it's difficult for ministers to get to travel to really build those relationships in that part of the world. this is a cross government effort, this huge focus and resolve, and i think that is the only way we are going to crack

that, and at the same time we can't take our eye off other parts of the world where other trouble might be brewing. >> speaking of trouble brewing, in the uk like many european nations, there's a challenge from homegrown terrorism and the number of people flowing from britain, and norway is challenged with it, and a whole bunch of countries where they would not have assumed, and on the domestic front, what are some of the things that the uk is doing in looking in addressing at this challenge because that is staggering, the numbers of self radicalized people becoming involved in this campaign, if you will. >> we are doing a tremendous amount. before i became a minister in defense i was in the department of local government and there

are huge programs and initiatives to really insure that this doesn't happen. i think -- there are many programs that run, but one of the things that i think that coming back to my speech that we can do is to really build the connection between certain communities that are vulnerable and have people in them that are vulnerable to radicalization, and their nations' armed forces. one question that has been posed to me is that why is it that someone from those communities will go and risk their life fighting for pakistan or another nation and feels the need to go and protect that nation, but not wish to do the same for the uk, and it is very clear to me that although i have recruitment targets for ethnic minority communities and before i chief

it and start achieving them, i have to build that connection between those communities and our armed forces, and our armed forces are there to protect them and serve them and they should feel ownership of them and that is my immediate priority. >> any other questions from the audience? we have two minutes. harlan? i was going to hit her with a marine engineering question. >> this is a larger one. as you know there's a huge controversy in this country in terms of opposition to the iranian nuclear agreement yet in britain, germany france, russia and china, and there seems to be solidarity that it's a good agreement. what do you know that we don't? >> i don't think there is much

that i can say that has not already been said on this issue. in both of our countries, you know, it's not a universally held view in the uk, and there are people who have concerns about it, or think that it's too high risk or that we don't have the right controls in place. fundamentally this is our best shot at what i hope is a shared objective and goal. we do have those mechanisms in place. it's not the case that after 15 years suddenly everything is a free for all. you know, the question that i think that i would always put to those that are skeptical about this is what is the alternative? i think this is our best chance, and that is that the view of the international community.

i have mentioned the work we are doing on the gulf strategy. we have done a huge amount of work, as well, to reassure and protect israel's interests, but this is going ahead, and i think even those who are not of that school of thought would recognize that this has a chance. >> thank you so much for joining us and spending so much time for us, and i think i speak for everybody here that you are welcome back anytime. >> thank you for having me. [ applause ] one of the first items of on the next washington journal, snoort ron johnson of

wisconsin, chairman of homeland security and government yapal affairs committee on the iran nuclear deal. a look at the iran nuclear deal with congressman davis price of north carolina. later, our spotlight on magazines features david harsani and the federalists on the debate over gay marriage and the rule of law. washington journal is live every morning at 7:00 a.m. eastern on c-span. >> he was a nazi. he was a concentration camp commendant and he was responsible for the murder of thousands of jews. >> this sunday night on q&a, jennifer teaga on her life altering discovery that her grandfather was aman kirk, also known as the butcher of plasau.

>> he was a tremendously cruel person. he was capable of -- he had two dogs. he trained them to tear humans apart. there was a pleasure that he felt when he killed people. this is something that is very, very difficult to grasp. >> sunday night at 8:00 eastern and pacific on c-span's q&a. medicare part d helps pay for senior prescription drugs. the house energy and commerce committee held a hearing on the program and the problem of drug abuse and fraudulent claims.

two health and human services officials testified at this two-hour hearing. good morning, i convene this hearing on the oversight and investigations. we are here today to discuss the ongoing problem with the entitlement programs waste, fraud and abuse. this time in the medicare part d program. the failures we will hear about today go far beyond loss of dollars and cents and they are helping to feed the prescription abuse crisis gripping the country. medicare part d is the fastest growing component of the medicare part d program providing 39 million beneficiaries with supplemental drug prescription coverage. given this rapid growth, medicare part d has been a prime target for fraud and abuse and in this past june the department of justice announced a nationwide takedown that led to charges of 243 individuals and $12 million in false billings. this joint law enforcement

effort that involved the department of justice and health and human services and the instructor general and the fbi should be commended, but more work needs ton done at the agency level to make sure fraud stirs are not able to take advantage of the program in the first place. the office of inspector general has been working diligently to reduce the waste and fraud. it will save taxpayers a tremendous amount of money and would insure that prescription drugs are being used as intended and not being over prescribed or diverted and cms has not implemented the recommendations, and the nine recommendations have highlighted recommendations, and in some instances up to five previous

reports that date back to december 2006, and these are common sense recommendations, for example, requiring plan sponsors to report all potential fraud abuse, and this recommendation was issued in five different oig reports. another important recommendation was to implement and reject prescriptions by providers excluded from the program. just six weeks ago one of today's witnesses testified before the sub committee and said holding our feet to the fire was appropriate and when asked about fraud occurring under that watch, that's what we are going to be doing today. cms's failure to implement the recommendations, in its data brief oig found a lot of questionable billing was tied to

commonly abused opioids. the oig abuse resulted in loss of lives last year. as we examine this, the total number of beneficiaries are receiving this. since 2006, medicare spending for opioids has been faster in spending than all the drugs. the oig outlined several common sense recommendations cms can implement and it's upon them to take action before the abuse reaches a level of a nation-wide takedown. the committee is concerned that when we see steps not taken and

tools not utilized. we are listening today to the ideas of our witnesses of how we can do this, so i thank our witnesses for joining us, and it's this sub committee's hope we will hear concrete plans from you on how we can go about accomplishing this task. we may need funds in other areas of care so we would like to hear when you make recommendations if there are things that save us money and we know we need, please tell us that as well. i now recognize the ranking member of colorado for five minutes.

>> thank you, mr. chairman. medicare part d represents the fastest growing component of the medical program overall. spending for part d drugs increased by 136% from $51.3 billion to 121 billion. in the last five years the oig reported a increase in complaints and cases involving the part d program. the office of management and budget declared part d a high error program with an estimated improper payment rate of 3.3%, or $1.9 billion. that could make up the difference with the 21st century cures and the money we had to take out. ps. as with all federal health care programs reducing improper payments and protecting taxpayer dollars must be a priority of the department and committee, but here is the part where i pile on to the chairman's statement, because it's not just

about federal taxpayer dollars and it's about all the other problems you have with medicare part d. as the chairman said we are in the midst of a prescription drug abuse crisis. in 2013 prescription drugs were involved in many deaths. over 2.1 million americans live with the prescription opioid addiction while 467,000 americans are addicted to heroin. these are devastating numbers. the chairman is right. the series of hearings that we have had this year have been one of the most eye-opening series

of hearings we had in the committee, illuminating this problem. part d is part of it, because drug diversion and over prescribing are serious challenges in the program. between 2006 and 2014, part d spending grew by 156%. additionally, generic vicodin was the number one prescribed drug in the part d program in 2013. the oig is going to testify that investigations into part d fraud, waste and abuse have uncovered not only financial harm to the program but also serious medical harm to individual patients from the inappropriate prescribing of opioids. in fact, last month the department announced the largest takedown in the history of the medicare fraud strike force resulted in charges against 243 individuals involving about $712

million in false billings. more than 44 of the defendants arrested were charged with fraud-related to part d. so i want to take a minute to recognize both the oig and cms for the excellent work in achieving this important outcome and sending a message to the perpetrators that those that steal from federal health care programs will pay a high price for their crimes. i look forward to hearing from our witness about the what the agency has done to strengthen program integrity in part d as it pertains to over prescribing, and i know the monitoring system resulted in a substantial reduction in overusers in part d, and this is a excellent step in the federal effort to address the prescription drug use epidemic.

there are additional opportunities to identify fraud, waste and abuse, as the oig describes, insuring the integrity of the part deprogram requires many things, and to the oversight role. however, cms does not require planned sponsors to report potential fraud and abuse. in 2012 only 35% of plans reported such data voluntarily and in the opinion of the oig the low level of fraud identified by some plan sponsors races questions about the sufficiency of their fraud and abuse detection programs. i know you will have more to tell us about this today, and i think it's important, mr. chairman, that we follow-up with the plan sponsors themselves to find out why they are not

reporting this information about the fraud detection system. it would have been helpful to have them here today but perhaps we could have another hearing and with that i yield back. thanks. >> the gentle lady yields back. and i will recognize ms. blackwell for five minutes. >> thank you, mr. chairman. i want to say thank you to our witnesses. it's not your first appearance and i am certain it's not going to be your last. we are so pleased to dig into this issue. the chairman spoke well to that. going back to what was being said, when you look at the opioids, you have got the abuse, the beneficiaries, common sense is going to tell you something is wrong with that. that's just common sense. and then last month we had 243 individuals charged with $712 million in false billings. these people were also charged with money laundering and aggravated identity theft and

what these crimes highlight and what this growth highlights is basically what is happening at cms, doctor, which is the pay and chase model. it is just not working. my office has just completed a study going back and looking at the inspector general reports and i want you to know hhs ranks as, i think it is, number 4 over the past ten years in collective abuse -- no, number 2, they are number 2 on the list, $10.3 billion wasted. oig has pinpointed this, and you have good suggestions, you have

got nine outstanding recommendations made for cms right now that you can do something about this and it has not been implemented. you are going to say we need more money. guess what? when you have a budget closing in on a trillion dollars and you have $10.3 billion worth of waste you have done nothing about, we need to come dock you that $10.3 billion. by the way, that's a four-year window. you don't deserve more money. you don't deserve it. because you are not taking good care of the taxpayer dollars that are coming your way. what we want is to make certain that people that need a program and deserve a program and are rightfully in a program are going to receive the benefits of that program, but waste, fraud and abuse is going to be targeted and rooted out and when you are given recommendations we expect those recommendations to see an action.

don't tell me you are over worked and don't tell me you don't have enough money, because when you have got a job to do you work until the job is done. and that is what we are wanting to see is that you are going to do your job. so my question to you today is going to be very pointed. you have been given recommendations and do you agree with the recommendations and what are you doing to enact those recommendations and what is your timeline for having them completed. those are the questions that i am going to have. mr. chairman, i will yield my time to whoever would like the balance of my time. >> anybody on this side that would like to speak on this? if not, the time is yielded back. i will recognize mr. palone for five minutes. >> the medicare part d program has been a great success for our nation's seniors and people with

disabilities and i am glad we are here to discuss ways to strengthen and improve it. americans often living on pix fixed incomes, now more than 40 million americans have access to the medications through the program. they are closing the gap in coverage with beneficial ease pay the full cost known as the doughnut hole. the aca gradually faces out the doughnut hole and kphraesz it completely by 2020 and since the law's enactment 9.4 seniors and disabilities saved over $15 billion on prescription drugs and an average of $1,500 per beneficiary. these are real dollars and real savings for phrpbz allowing them to live healthier lives and have the peace of mind they won't have to decide to put food on the table or life-saving medications. for example, under the authorities in the aca cms recently had a program that would insure part d drugs are only prescribed by individuals

qualified understate law and the under the requirements the program and implements the long-standing recommendation of the inspector general and it gives the authority to provoke the status under certain circumstances including if they determine the provider has a pattern of prescribing drugs that are abusive. and they want internal controls to prevent overuse drugs.

they make them more data driven and reus based and i look forward to hearing from the office of inspector general and cms about the important steps they have taken to improve the program in part d. i wanted to highlight the important bipartisan work of the committee. in 2014 the oig recommended that statutory authority to implement a pharmacy lock in program that

would allow part d to develop safe describing and dispensing programs for some substances, and the medicare prescription drug integrity act of 2013, i am gratified that part d partners now have the authority to have the lock-in programs. it improves patient safety while protecting beneficiary access. i look forward to hearing from the assistant inspector general maxwell about the recommendations and from the doctor regarding cms's ongoing efforts to strengthen part d. thank you, mr. chairman, for convening this hearing.

i was going to yield -- i don't know if anybody else wants the time. i guess not, so i will just yield back. thank you. >> thank you for yielding back. i might comment on the opening statements. i think this committee does this work when we're united and that's clear it is the case today. i also want to make sure i ask unanimous consent if any other members want to introduce an opening statement for the record they can do so and without objection those documents will be accepted. you are now aware the committee is holding an investigative hearing. while doing so has the practice of taking testimony under oath. do either of our witnesses today object to testifying under oath? both say no. do either of you want to be advised by counsel prior to your testimony today? both say no. in that case rise and i will swear you in. do you swear that the testimony you are about to give is the

truth, the whole truth and nothing but the truth? both witnesses said yes. you are under oath, and you may now give a five-minute summary of your written statement. >> chairman and members of the sub committee thank you for the invitation to improve the drug program known as medicare part d. our objective is to insure everybody receives the medication they need while preventing the drug abuse. we appreciate the subcommittee's continue focus and efforts to combat the overutilization of prescription drugs. we also thank the oig for its work to improve the part d program. the growth of prescription drug abuse touched providers and pharmacies and beneficiaries in the part d program. the statutory con trucked of

operating the part d program requires cms to work through hundreds of sponsors which presents challenges to the program. cms has taken concrete actions in recent years to strengthen the part d program and weaknesses identified. one of these changes is enhancing the culture to include a focus on program integrity, and instituting and implementing new authorities to insure only legitimate providers are prescribing medications. in particular, we focused on holding those accountable for prescribing consist unthe of goals and values of providing good care. cms announced plans to undertake a major program change which

will require prescribers of drugs to enroll in medicare and just as they would in parts a or b of the program. we have begun outreach efforts to enroll other prescribers by january of 2016. we will begin enforcement in 2016. during the enrollment process, prescribers will be subject to the same enrollments from the medicare program. this enrollment standard will address issues oig noted through

new point of sponsors. cms has authorities to remove prescribers. together we believe the new policies will prevent bad actors from taking advantage of the program and potentially harming beneficiaries. and we are using part d more effectively. they are enhancing the detection. there's a system and we share a list of the beneficiaries with planned sponsors which are expected to prevent continued over utilized. cms also developed high risk

pharmacy and scriber assessment that, based on the methodology that goes beyond simple analysis. we provide sponsors with this information so they can investigate and audit. our newly implemented system allows planned sponsors to report back actions they have taken to address issues posed by pharmacies and prescribers and we have taken steps to improve data sharing with colleagues and law enforcement. cms made nearly 2300 referrals to law enforcement. we are working closely with the oig to prevent bad actors to mismanage dollars. cms takes seriously the

recommendations of the oig. we continue to work with the oig, this committee and others as we strengthen medicare part d. i look forward to answering your questions. thank you. >> mrs. maxwell. >> good morning. i am pleased to join you today to discuss how we can protect medicare's prescription drug program from fraud and abuse. the oig made a strong commitment to help safeguard medicare part d. just last month other law enforcement personnel fanned out across the country to conduct the largest criminal health care fraud takedown ever, and a number of the arrests were for doctors and pharmacy owners

involved in the prescription fraud, and we found part d continues to be vulnerable to fraud. recently we identified 1400 pharmacies with questionable payments. in one example, 93% of its part d patients were prescribed opioids. it's tied to illegal drug trafficking which is why the oig is not stopping with the recent takedown. as our special agents investigated and built these cases analysts were already identifying new leads to help

us, cms, shut down and target this program. as important as our law enforcement efforts have been we cannot arrest our way out of this program. we have to strengthen our defenses. oig has several outstanding recommendations for fixing some of the systemic vulnerabilities to allow abuse to slip through undetected. there's a tool to provide oversight. this includes collecting the data necessary, and the hundreds of private companies that administer the program are effectively protecting the

program. these planned sponsors are part d's first line of defense. currently as we already heard, cms does not require these planned sponsors to report on the fraud and abuse that they identify. while planned sponsors may report this information voluntarily given the choice we found that less than half chose to report. information on identified fraud and abuse as well as how sponsors handled the cases would help cms. we recommend that cms sponsors look for a range of drugs prone for abuse. while opioid abuse is a concern, oig identified questionable patterns related to other drugs, and this includes noncontrolled substances which can be abused in combination with controlled substances. in addition to better leveraging data, planned sponsors should buttress plans. they need to implement stronger payment controls to stop paying for things they should not be paying for. or paying for illegal refills of controlled substances. second, another powerful preventive measure would be a

lock in program that would restrict them to a limited number of pharmacies and prescribers. finally, we recommend that cms improve processes to recover inappropriate part d payments. our ae sent law enforcement and data minding efforts show the current programs are not strong enough and they need to reinforce that first line of defense but they cannot be the only line of defense and ultimately it's cms responsible for insuring the integrity of part d. for our part we will continue to focus our full array on resources of protecting the program and we stand ready to work with you and cms and others to improve program integrity. at this time i am happy to answer any of your questions.

>> i will recognize myself for five minutes. we know prescription drugs and medications can heal and keep you out of hospitals, and does cms have any kind of report that really takes an accounting as the prices have gone up in medicare part d, have there been a decrease in hospitalizations or doctor visits? >> i am not aware of a report along those lines. i am not seeing it, so i am happy to take that question back. >> thank you, and i wish you would. ms. maxwell, you point out nine recommended implications. some of those go back to 2006. does cms agree with the recommendations by oig? >> i think we do agree and expressed that in writing, and these are all recommendations that we are working to make progress on.

i think it's fair to say that we need to continue to work on it and need to get to completion. these are often multifaceted recommendations that require multiple levels of implementation. >> i am trying to get commitments from you to get that done because it goes back to 2006. the oig recommended a exclude schedule two refills. so what action is cms taking to implement that recommendation? mrs. maxwell, can you answer that first. >> it's my understanding -- this is one of the recommendations in which cms did not concur, and this is one that they did not, and it's my understanding cms is concerned about the data available and the data does not make it obvious what is a partial and what is an illegal,

and they have actions to make it more clear in the data. our position is once the data is clear then you have the opportunity to put in an end to stop those refills. >> i think ms. maxwell characterized that correctly. the data is not completely accurate at this point. early refills -- partial refills for cares are totally legitimate and may be able to address pain and other issues they have. >> as part of that going after people who have made wrong claims and getting that money returned. on page 3 of your testimony you mention the budget proposes to provide the secretary with new authorities by providers who have been engaged in mis prescribing. do you have any estimate this will save money in terms of reducing fraud and abuse to implement those recommendations? >> yes, i think these kinds of

recommendations really go at the heart of preskrepbtion moving away from the pain and chase models others commented on. we did implement the ability to revoke prescribers. >> i hope that is something you can give us numbers on in terms of what you estimate that would be savings to medicare part d. that would be important to us. and this is on medicaid but it's important because a report just came out in march issued by the hh office of inspector general and found that 92% of medicaid enrolled children who are prescribed anti-psychotic medications lacked medically accepted -- it was a very disturbing and alarming report, and a 92% number of not medically indicated was alarming. would you make sure you get back to us on that? >> absolutely. >> oig recommended an edit to reject prescriptions written by

providers. what have they done to implement that recommendation? >> it's my understanding the sponsors are required to be monitoring excluded providers and making sure that the payments don't go to them and when we did look we did find cms

did accept records from the sponsors that included excluded providers, and we appreciate the steps that have been taken but there are needs for further steps and stronger controls be put in place. >> i am out of time. >> let me extend that previous line of questioning, which is we're talking about the oig report on medicare part d, integrity and the report notes, quote, cms relies on planned sponsors to be the first line of defense against fraud, waste and i pwaous in part d. can you comment on the role first line of defense against fraud, waste and abuse, and what do they use and what can be done?

>> i think the role of part d plan sponsors is extremely important since they are paying complaints directly. maybe i can address the prior part of that first. i think it's indefensible for a part d plan sponsor to pay for an excluded provider. we have xwlmt implemented edits wind those planned sponsors to indicate when they have done that. they can make the appropriate recoveries on their end. i think prescriber enrollment and the screening requirements i mentioned earlier will go a long way and will move the edits from after the record to the point of sale when we have all 400,000 prescribers enrolled in the program. their role is vital. they need to be on top of the data and we share a lot of data with them so they know who the outlined pharmacies and prescribers are, and they can utilized other programs including management.

>> let's talk about that data for a minute, because they are not required to report the data on potential fraud and abuse, and the percentage of sponsors that voluntarily report this declined over the last few years from 40% to 2010 to 35% in 2012. do you have any more recent data about the trends on this? >> i don't think we have more recent data that i can share today however there is an area we have been working on to make progress as well, and we give data to the planned sponsors on a quarterly basis, ask we implemented a system which

allows the data to be reported and then to be searchable and analyzable have been an important step moving us towards better reporting. >> what is your view on this, ms. maxwell? >> it's true, as i said in my oral, sponsors are the first line of defense. cms, as i said, is the second line of defense and if things do slip through the processes they have in place it's incumbent upon cms to have a second line of defense. >> and do you think cms is doing enough to encourage that? >> i think cms made significant strides in response to many recommendations and we outline the nine in our report that we believe are important to be included in their ongoing effort to improve integrity. >> what about the fraud detection in the programs themselves, are the planned sponsors doing enough? >> if we had more data about the fraud and abuse they are detecting as well as the data how they are responding we would be able to answer that question with more authority. we don't have the visibility we

think is necessary to hold them accountable. >> is that something, doctor, you think you could provide? >> we are getting some data from planned sponsors and in particular we are focussed on where we give them a clear lead such as an outlier prescriber or pharmacy, and what we have found is certain planned sponsors are good at following up so we have been able to see hundreds of pharmacies be excluded from networks because of the leads we give them, and we have compliance reviews to make sure there are robust operations. >> this is an area where it seems like there could be a lot of problems, and the oig has recommended making it mandatory that they report potential fraud and abuse. i am wondering, could you comment on that recommendation? >> absolutely. as you have pointed out, given the current affairs that is voluntary, we don't have full compliance, and we believe we

will not have full compliance unless it's mandated and without the comprehensive report of the data we cannot look at the entire program and see. >> doctor, what is your agency's response time-out? >> we concur with that, and the question is what kind of reporting is the most beneficial for other planned sponsors and the agency. implementing something like the plato system and getting leads is a step towards answering that question what kind of information return is useful to the agency and would be useful to other planned sponsors. as we get more information and get a better understanding of the utility, we will be able to require more planned sponsors. >> i am sure we have more

questions around that line, too. >> we recognize the gentle lady from tennessee. >> i will follow along with that, it's troublesome when we hear, and ms. maxwell of course you have done so much work on this, with the voluntary nature of the reporting and you have recommended they make it mandatory, and so doctor, what are you doing to beef up the compliance? you can say we have plato and this, but what are you doing to enforce this? how do the people that work at cms understand? this is imperative. you have to do this. how do you communicate that? >> i think we take all of the oig's recommendations as

important -- >> they are not contributions. let's not even start down that road. it's not a contribution. it is you are doing this wrong, you are wasting money and the fraud has been identified. let's say it like this. they have nine recommendations on the table. do you a degree with those recommendations, yes or no? >> i think we have indicated that we largely agree with those recommendations, yes. >> that's not the question that i asked. yes or no? >> i think ms. maxwell pointed out -- >> okay. the problem is, what are you doing, then, to take an action and what is your timeline? you seem to come here and punt, and we have another report that came out this morning, you are saying -- by the way, it's only two months late. you are two months late with your report. people in the private sector that deliver a report two months late generally are, you know,

they have other problems. okay, so let's look at this. you are saying that you have recovered $454 million and that your fraud prevention system is returning a 10 to 1 ratio on this investment. you are very proud of that, but you have a lot of other wastes that is out there, so i want to know from you specifically how are you enforcing the recommendations and what is your timeline for bringing your agency's work into compliance on a program that is really important to our nation's seniors, and that's not that difficult to question. getting the work done, that's a little harder for you. we want to know specifics on your enforcement and specifics on your timeline of meeting this. >> first congresswoman, let me

say on the fraud prevention report, those numbers have been certified by the oig itself and this report that we worked on in conjunction with them -- >> i am fully aware of that. >> it's a good development for the system. as to your questions about the various recommendations, i am happy to take that back and we can give you responses, what we have done to implement them. we have worked to make progress and implement various systems and changes towards finally completing that recommendation, but these recommendations do take time to implement. >> you said you had the authority to do that job. we know you have the money and the personnel. why does the job not get done? is it not a priority? >> this is an absolute priority. we have many staff focused every day on the integrity of the medicare program. >> do they understand they are expected to meet a timeline? do you have a timeline?

you still have not spoken to the timeline? >> it depends on which recommendation you are referencing. >> no, all of them. you can't pick and choose, and you have a list of recommendations and you have had waste, fraud and abuse identified and you know you have problems with the opioids, and you know that voluntary reporting gets you part of the way but doesn't get you all the way and this needs to be made mandatory. so as the leader, what are you doing to make certain that there is a set timeline? when is the timeline? is it the next report? is it the next hearing? is it the end of the year? >> let me give you an example. we have been specific when it comes to something like preskraoeber enrollment which will go towards resolving two of the recommendations oig put forward, around excluded providers or any other invalid prescribers. we stated, you know, we are working to get prescribers

enrolled so we don't have an interruption with the action. we will implement point of sale in june of 2016 which will take a significant step towards eliminating -- 6/ >> basically you are giving yourself a year to come into compliance with something that -- i yield back my time. >> you can let him answer. >> i think it highlights some of the technical challenges in getting the work done, so we have to be careful to enroll 400,000 prescribers so we do not interfere in legitimate access. we balance that against the need to do this quickly and

effectively to stem the weaknesses that oig correctly pointed out. yes, it takes time for prescribers to get up to speed on the requirements and get enrolled and takes time for part d sponsors to get the point of sale edits in place as well. >> thank you. >> i believe that both of our witnesses here today studied the growing phenomena deeply concerning and that's the over prescribing and over use of opioids in medicare part d. this is an issue we have worked on for many years in response to oig's earlier work on this topic. i introduced the prescription drug integrity act of 2013. since that time oig repeatedly, when warranted by questionable billing practice, this is

referred to as lock-in, and it has been successfully implemented in the state market. in the 21st century the house overwhelmingly passed on friday a provision that would allow medicare part d plan sponsors to use these type of drug management program. that provision is agreed to in the legislation and strikes the right balance between protecting beneficial choice and access while improving continuity of care by insuring the high-risk patients obtain and fulfill prescriptions from controlled substances only from certain providers. can you summarize oig's

recommendations to create the lock-in programs? >> absolutely. as our current data brief shows, the rate of increase of opioids within part d far out paced the drugs, and we also see as i mentioned the pharmacy fraud where we see pharmacies allowing for opioids to flow into the streets and be diverted. this poses not only a patient harm issue for the beneficiaries. there's a significant issue and we believe the lock-in would be a significant move forward to protect everybody. >> do you believe if the pharmacy-lock in prevention were put into law, it will help with the over prescribing in part d? >> i would certainly agree with

ms. maxwell we have seen beneficiaries that are at a safety risk from the opioid medications. i do believe that it would have impact as it has, you have already pointed out in the private sector as well as various medicaid programs. >> i want to switch to that report that ms. blackburn mentioned that the agency released this morning. the fps uses predictive and analytics to detect billing problems and provide the program and after three years of operations cms today reported the system identified or prevented $820 million in

inappropriate payments in the program's first three years. commend you on your work. in its third year how has the program changed and matured? what additional plans does the agency have to expand to additional fraud detection activities? >> thank you. what we have seen in the last three years in terms of evolution of the program is more sophisticated models being implemented that look at outlier behavior and the investigative input of law enforcement both

aig and doj based on prior patterns of fraud and abuse that they have noted. so that's one really big change on the technology side and just improving the modeling. the second is making sure that these leads are actually being followed and this is just a cultural change or a contractor accountability change to make sure these contractors took these leads seriously and they formed a substantive bork load and driving toward outcomes as quickly as possible. i think what we'll continue to do with this program is continue to leverage the technology to implement new approaches like edits so that claims can be stopped from being paid. before they're ever paid we've been doing that some of that already in the first three years and we're looking to expand that capability substantially going forward. i think also just the maturing of the modeling will facilitate this process. to your question of other data sources, we have started to fold in part d pde records and we'll be looking to do that more. in part c, we still have the challenge of getting accurate

encounter data from planned sponsors. so we're still working with the relevant parts to help improve that encounter data. >> thank you. thank you, mr. chairman. >> you now recognize mr. barton for five minutes. >> thank you, mr. chairman. the first thing we want to do is thank hhs and the inspector general for conducting the investigation and actually beginning to try to correct the problem and at least identifying some of the bad guys and that's a good start. my first question, i guess would be to doctor -- is it agrowald? is that correct? >> you nailed it. >> how about that? just a lucky guess. how in the world can somebody be on medicare part d if they're not enrolled in medicare. if i heard correctly, you say some people are getting the benefit, but not on the program. i don't get that. >> it's not on the beneficiary side of the equation.

it's the prescriber and the physician or advanced practice nurse who actually sends a prescription in and sends it to a patient and currently or prior to last year there was no specific enrollment requirement for the provider. there is now and going forward all prescribers will be subject to the same screening standards as in the rest of medicare. >> okay. but prior to this year, a provider could reject medicare patient, but prescribe medicare part d prescriptions? >> correct. it's been a huge program integrity focus to bring this up to the rest of the level -- to the level of the rest of the program. >> that's no longer a problem. that's one loophole that's been closed. >> we are in the process of closing it as we get through enrollment. we have to enroll 400,000 prescribers by january. >> okay, and if they have a doctor that's not in the program you just send a letter to the patients and that's not a valid prescriber, is that correct?

>> yeah. so the balance with beneficiary access to medications is important. what we have done is created essentially a transition period. so if a beneficiary takes a prescription to a pharmacy from a prescriber that's not enrolled they will get that information and they would get the medication so there is no interruption in their therapy and we would expect it to be enrolled and go to a different provider. >> okay. >> i'm going to switch to ms. maximum. one of the things that haven't been acted on and the program is beginning to act upon is this idea of mandatory reporting from the plans. i'm not a big fan of mandatory anything except people paying their taxes, i guess. that ought to be mandatory. why not got other way? why not create -- i heard that. voluntary compliance, but you go

to jail if you don't voluntary comply. >> a minor point. >> why not provide an incentive to the plan, but if you do and it is fraudulent and we recover some of the program funds we'll give you a percentage of moneys that have been fraudulently paid and then recovered. why not create an incentive program and that works for me, and i think most republicans would prefer it, and i may be wrong, but i would rather have an incentive to do it than a mandate that has to do it. >> the heart of the recommendation is to have the visibility to oversight and as

long as they have what the plan sponsors are doing to protect the program, that is ultimately what we're after. >> congressman gingrich when he was speaker requested that this committee put in a program where you could create a hotline that people could call into, and if it turned out that this wasn't just for medicare, this was before medicare part d,