particularly when it comes to health care. in his latet role, he's worked diligently to ensure massachusetts maintains its status as a state with one of the lowest uninsured rates in the country. as the rate continues to fall nearing single digits thanks to the affordable care act, i'm looking forward to hearing more about your efforts to make our system more efficient and effective as well as any best practices that you've encountered that could be applied across this country. thanks so much for being here. yield back. >> remaining time to ms. capps. >> thank you. to the ranking member tor yielding and letting me, also, letting me waive onto this sub committee for what i know to be a very important discussion. i wanted to come and personally welcome mr. lee, the executive

director of covered california which is my state's health insurance marketplace which has helped connect so many of my constituents with health insurance. you know, california made a conscious decision to be an active player with the affordable care act imminimum meantation. there have been efforts to make california a leader. we have cut our state's uninsurance rate by 28%. pretty remarkable in my opinion. california shows that when a state is invested and buys into the stakes of the affordable care act, prices can be held under control, quality plans can be made available for purchasers. i look forward to hearing how covered california could serve as a role model for states looking to get the best value for their residents while promoting high-quality care. and i'll yield back to the ranking member. >> thank you, gentle lady.

i know we asked for u nnanimous be entered into the record. the committee is holding an investigative hearing and has a practice of taking testimony under oath. do any of you have any objections to testifying under oath? and all the witnesses say no. the chair advises you that under the rules of house and committee, you have the right to be advised by counsel. do you have a desire to be represent by counsel? and all decline. do you swear the testimony you are about to give is the truth, the whole truth and nothing but the truth? >> yes. >> thank you. all the witnesses have answered in the affirmative. you are now under oath and set

fort in forth under the united states code. >> we'll begin with mr. allen. make sure your microphone is on and pull it very close to you. >> make sure the microphone's on. is the light on? pull it real close. >> thank you, chairman murphy, ranking member degette. my name is patrick allen and i'm the director of the oregon department of consumer services. we're the state's consumer protection agency. while supporting a positive business climate in the state. my agency's responsible for regulating banks, credit unions, mortgage lenders and other nonano non-depository programs.

and oregon osha as well as statewide construction standards. as of 90 days ago. after a brief transitional period, the department assumed responsibility for oregon's state-based health care marketplace. i appreciate the opportunity to be here today and to talk about the health care services in oregon and my agency's plans going forward. you have my written statement, so i will briefly summarize with three points. first, oregon's marketplace is successful. nearly 70,000 oregonians enrolled in coverage during open enrollment for 2014, despite needing to navigate a hybrid paper and automated system. using healthcare.gov that number rose. the rate in uninsured in oregon declined from 14% to under 9%. oregon's health insurance

marketplace is healthy, competitive and sustainable. for 2016, 11 companies will offer oregonens 120 various plans at various coverage levels. we're in the process of rebalancing the market to ensure its long-term sustainability. and while the percentage increase has been significant. the result tants rates are very comparable to those available in neighboring markets of california and washington and remain very affordable. third, the marketplace as run by the state of oregon is efficient. we as a state agency are able to operate the market lace with about 60% fewer staff than the previous organization. we're completely financed by an assessment on participating insurancers with no state funding or taxpayer funding

involved. we have adequate financial capacity to pay a reasonable technology cost to the federal government or a private membership should that be necessary. >> this is allison o'toole from minnesota. you're recognized for five minutes. you now the drill with the microphone. >> good morning chairman murphy, ranking member degette. my name is allison o'teal and the interim droechlt of minnesota's online health insurance marketplace. thank you for inviting me today. i am honored to share with you the success we've seen in minnesota. let me begin with an update on

how min sure has benefitted us. for the purposes of background, i want to provide the committee with a full picture of where we are today. since october 1, 2013, more than 500,000 minnesotans have use the min sure to shop and procure affordable insurance. minnesota has the lowest rate of uninsured in state history. in our first year, the uninsured rate dropped by a whopping 40%. and now nearly 90% of minnesotaens are covered. and i'm pleased to report that min sure is financially sustainable. we have a balanced, conservative, sustainable budget that's based on real numbers and

real experience. and we've come a long way since our launch two years ago. the last 18 months have brought measurable progress, along with a dope commitment to transparency and accountability. and most importantly, we're making a difference in the lives apartment health of minnesotaens. minnesotans like richard dean, a cattle farmer who with his newly-purchased coverage went to the doctor for the first time in year, discovered he had cancer and was able to successfully treat it. today richard's cancer free. and like jake sanders. he and hess wife have three small children. one who's had a pre-existing condition since birth. min sure allowed jake to find a lower cost policy for his family, and today he knows his son will be covered. covering more minnesotans has always been our foundational goal since day one.

and min sure's technology performance has improved dramatically since then. after lots of hard work, there is a night and day difference between the first and second enrollment periods. call wait times fell and our dedication to improving min sure continues today this is important to us, because we think no one should struggle to find a health insurance plan that fits their needs. it's also important in making sure minnesotans can live their lives and folk on the important things like going to work, taking care of their families and starting a business, instead of worrying about how they're going to pay for big medical bills. as we approach min sure's third open enrollment period, there's plenty of work ahead. our i.t. firms are hard at work improving website performance and ensuring a positive consumer experience. there's also a strong focus on

improving mirn sure's functionality. one final point that sets us apart. in minnesota, our state recently created a 29% bipartisan health care task force of health care and community leaders who will help address questions like access to care and financing. minnesota's taking oversight and accountability seriously, and i'm thankful to these people for their thoughtful approach to addressing many tough questions that remain for our health care programs. thank you again for inviting me here today. as min sure's interim ceo, my eyes are squarely focussed on preparing for the current enrollment period, improving the experience for minnesotans and making sure that as many people as possible take advantage of the products mirn sure has to offer. we want to see people like richard and jake and their

families get the care they need and deserve. i look forward to your questions and thank you again for having me. >> thank you, ms. o'toole. now we recognize louis gutierrez. >> chairman murphy, ranking member degette, good morning. thank you for the opportunity to testify regarding the massachusetts health connector authority, our state-based marketplace. my name is louis gutierrez and i have served since february of this year following the election of massachusetts governor charlie baker. as the new state administration took office, massachusetts was through a second attempt to implement health insurance enrollment system. while proficient eligibility was completed, a range of back

office enrollment functions remained under development. much of this year has been devoted to stabilizing operations and completing the systems foundations to complete massachusetts's state-based market please. upon taking office, the baker administration moved into effect several changes to the connector authority. first, it altered the structure, placing the health and human services as chair. the secretary of health and human services also oversees the state's medicare. and it helps with the successful coordination between the exchange and the state medicaid agency. second, it replaced management, hiring for experience and large-scale system implementations, along with a new chief operating officer, a woman distinguished in massachusetts payer operations. third, it appointed an

outstanding program management lead to lead the combined health insurance exchange, medicaid intergreated eligibility systems and implementation effort. fourth, because the exchange and eligibility initiative is shared between the health connector and the state's medicare organization, it reestablished a formal governance structure led by the state medicaid agency, the health connector and the state's central technology division. fifth, it undertook a six-week operational processes. and to lay a path for resolving existing problems. and finally, it completed the process for transferring individuals from temporary coverage where they had been placed in 2014 to appropriate placement in either qualified health plans or medicaid. the health kerkt is now better

situated to service the need the of residents of massachusetts. for 2016, we have 11 issuers presenting 83 qualified health plans on the connector, and 25 plans across issuers of qualified dental plans. we have 40,000 qualified dental plan enrollees. massachusetts is one of five states with less than 5% uninsured. we have significantly expanded customer service components for this fall's open enrollment period with 200 additional customer service hours, including evenings and weekends so that users may update their applications and not need to call the call center.

massachusetts believe that states need flexibility to continue to innovate health care. we could not provide to the low income populations without the flexibility of the marketplace. for example, our program which had subsidies for those earning less than 3% of the poverty level. we recognize the definition of small business size. going forward, there are potentially more seamless ways to integrate a medicare and subsidies. it is important that states be offered the chance to make this haw work better for everyone. massachusetts remains committed to make sure that those who need insurance can obtain it both now and in the future with the state-based market mace as one component of that strategy. thank you.

thank you, mr. gutierrez. now we turn to mr. jeff kissle. >> thank you. honorable members of the oversight and investigation sub committee. it's a pleasure to come before you to report on the activities of the exchange, but before doing so, i'd like to explain the health care environment in hawaii to help you understand the context of my remarks. yes, hawaii has among the lowest insurance rates in the nation. this is, however, because of the passage of the hawaii pre-paid health care act of 1974. at that point, the state undertook as a matter of policy the responsibility for providing access to health care and wellness resources for virtually every employed resident of our state. over the past half century, both democratic and republican administrations in hawaii have not only supported the provisions of the act, they've developed substantial resources and focussed on leading the

insurance and health care industry to actually delivering these services to an ever increasing percentage of our population. the evidence of our success is clear. hawaii is not ranked among the states with the lowest rates of diabetes, yoe weisity, infant mortality and other critical public health care metrics. our population, however, enjoys a longer life-span and by any measure, healthier outcomes faced by a diverse and cultural mix. i believe this is a result of our ability to develop excellent health care access and secure its viability through the pre-paid health care act with its employer mandate to provide insurance. in this context, the pass average the affordable care act was widely viewed as an opportunity to extend access to health care and wellness resources to even more of hawaii's population. for the most part, that effort's been successful, taken together,

the expanded medicare program and the affordable care act have reduced hawaii's uninsured rate, already low, by more than half. unfortunately, a lavg planning, unclear business process design and utterly inadequate program management at technology systems were implemented resulted in excessive spending and delays in delivering the important services to the people who most needed it in our state. since i became executive director of our team at the hawaii kerkt we've come a long way of achieving the forward-thinking health care act with the provisions of the affordable care act. our business processes now utilize technology to support a well-trained outreach team of workers as they assist our customers with the enrollment process. this change in approach converted our computer systems to a resource rather than a barrier to entry. in december 2014, we produced a

comprehensi comprehensive, ten-year strategic business plan, a copy of which is attached to this testimony. it detailed a report on our condition, the activities, sustainability required by both the affordable care act and state enabling legislation. it also presented both the advantages and the challenges as the exchange commenced its second full year of operations. in that plan, we explained to cms and our state administration how we would meet sustainability and other important requirements of the affordable care act. we recommended a financial approach that relied on debt financing and generating enrollment, revenue from about 70,000 enrollees at the rate of $12 million a year. i'm pleased to say that our enrollment in 2014 and 2015 increased by more than 400%. it is nearly now 40,000. moreover, the hawaii health care kenter was able to add thousands

of individuals to the expanded medicaid program further reducing the costs of our community. even though we were able to overcome first year technology challenges, it became clear to all of us that the cost of maintaining, upgrading and ultimately replacing the technology had the potential to exceed its initial cost. while the federal government funded the initial cost, the people of hawaii are responsible for the op going costs. after consulting with cms, our state administration elected to migrate to healthcare.gov as a supported, state-based exchange to ensure continued access to qualified health plans for our residents. i fully understand the basis for that decision as the risks of operating independently are greatly mitigated by the assistance of health care dofr technology and support from cms. we're continuing to work to harmonize the affordable care act with hawaii's frame work to provide outstanding health care

to virtually every resident and when necessary, any of the millions of visitors we welcome to our state each year. we thank you for your time, your interest in improving the quality of life in our country by addressing this important issue before the people of the united states. i look forward to any questions you have. >> thank you. and now recognize mr. peter lee, the executive director of covered california from the state of california. >> good morning chairman murphy, ranking member degette and des tinge wished members of the committee and the members from california, matsui and capps who were able to join you, but it's a hop or to be here in front of you before the sub committee to speak we've had in california implementing the affordable care act. this landmark legislation has dramatically changed health care in california and in the nation by putting in place new protections that benefit all americans. i'm pleased to address how covered california is working.

what we consider to be the keys to our success and how we are actively working to improve what we are doing in california. first, let me note that california's a state that embraced the affordable care act from day gun. we were the first to establish a state-based exchange. that legislation was passed with a republican governor and democratic legislature. since then, some of the tools we've put in place to build on are being an active purchaser. covered california chooses which plans to participate. we negotiate with them to make sure the rates, their quality, their networks provide the best value to consumers. second, we provide standard benefit designs. covered california sets the benefits so they benefit consumers. in california in the individual market, you will not see consumers surprised by not getting access to care because they didn't pay a deductible first. that's a standard that we have placed that primary care access

is not -- the health care is competing on apples to apples bases. third, california has expanded its medicaid program. under governor jerry brown and our legislature deciding to expand medicaid has meant that millions of californians have had the benefit of coverage they would not otherwise have had. so in california the affordable occasion a care act is working. 65% of voters say that and say they have seen the affordable care act working in our state, first and foremost because of strong enrollment. there's an additional 500,000 that have had coverage in the last year and a half that aren't covered today. that's not because they're uninsured. they're now with employer-based coverage or medicaid or medicare coverage. but exchanges across the nation are providing a safety net and a weigh station of individuals moving into the employer-based coverage with other options they

did not have before. this is part of why all of us will have about a one third of our population turn over every year. we are now the glue holding together the employer-based system in public programs. in california, insurance rates are under control. for 2016, the average rate increase in california will be 4%. in 2015, the average rate increase was 4.2%. two years in a row we've proven the nay sayers wrong. this comes on the heels of years of double denl iterate increases in the individual market. and let me make clear that in california the ben fisheries of those low rates are not just those in covered california, but the entire individual market. we have 1 million individuals that buy insurance not through covered california. they benefit from our negotiating on behalf of consumers. how did we get there? we have a good risk mix. we have a judge myoung mix, a d

mix that reflects the population of california and we take that to the tune of $300 million of premium savings by showing the plans, the data that there's a good risk mix. they've demonstrated that in the rates they've put before californians. coming forward in 2016, there's going to be more plan choices. we'll be expanding from the 10 plans to 12. we are adding oscar. the vast majority will have four, five, six plans to choose. but we don't think more is always better. we pick plans. we make sure that they're delivering value and they're building on the platform that congresswoman matsui noted of making sure that tweer' changing the delivery system and lowering costs for everybody over the long term. that's the future that we need to be looking for, building a delivery system that puts patients first, makes sure care is delivered when they need it.

we still have work to do, and i look forward to taking your questions as we talk about our path forward in the future. thank you very much. >> thank you in lee. and now finally, we turn to mr. jim wadleigh of access health connecticut. you're recognized for five minutes. >> good morning chairman murphy, and members of the sub committee. thank you for this opportunity to offer testimony as you examine the condition of several state-based health insurance marketplaces. my name's jim wadleigh, one of the nation's best in healthiest state marketplace. access health connecticut was established in 2012 by governor malloy, lieutenant governor weman. interest le their leadership has been critical to our success. so, too, has the commitment of the access health connecticut

team. sense we launched our state-based marketplace two years ago we've worked together to meet the unique needs of our citizens. today, i'm pleased to report that 760,000 state residents and small business owners have used the exchange to enroll in qualified health plans and medicaid. we've exceeded federal enrollment goals by more than 200%. we've cut connecticut's uninsured rate in half from 8% to less than 4%. that's 128,000 people who are now more likely to go to a doctor. we've worked with connecticut's insurance commissioner to keep costs down. rates for our most affordable plans have remained flat for the last two years. we no longer use state or federal funding for operating coarse. how d -- costs? >> how did we achieve this?

a pound of prevention is worth a pound of cure. we kept things simple and stayed true to our mission. our exchange is considered a national model because of its straight-forward design and ease of use. over 96% of access health connecticut customers say they are satisfied. the development of the stable, user-friendly website was overseen by an executive leadership team with a passion for health care and decades of experience in the industry. we set priorities, established clear business requirements and tightly managed scope of this project. to reduce the number of uninsured residents we conducted extensive research and partnered with numerous state and community-based organizations. this helped us better understand and reach those individuals and family most in need. we used creative, award-winning tactics while sticking to a simple enrollment message. in addition to putting feet on the street, we opened store on

main street. taking a page from apple's customer service playbook, we provide fry, professional guidance in a personal touch to help consumers navigate the complexity of health insurance. the success of these stores has exceeded expectations. not even the blizzard of 2015 which dumped two and a half feet across the state could keep people away. our year-over-year foot traffic in january more than doubled. access health connecticut is the first state exchange to intergreat closely with our back end systems. this nationally recognized award-winning apps allows customers to look at accounts, purchase plans all from the palm of their hands. our ability to collaborate across boundaries for heal insurance -- we were honored tor creating a multi-channel, no

wrong door experience for consumers. solid technology and a commitment to exceptional consumer service has made us a model for other states. connecticut isn't just ahead of every other state, it's in its own league entirely. we will continue to collaborate with other state-based exchanges as we did with maryland to share our expertise, business practices and technology. we will continue to innovate and develop new strategies that expand access to health care, promote health and wellness and eliminate health disparities. we will continue to explore new opportunities to reduce costs. safeguard our long-term financial stability and keep premiums affordable to all consumers. and we will never lose sight of why we do this. it's for hard-working people like walter who operates a dry-cleaning shop in connecticut. once he hit 50 and developed a chronic health issue, his

insurance company began raising his rates. through access health connecticut, walter found a cheaper plan that allows him to keep his own doctors and afford prescriptions. he's living the american dream and has the peace of meepd knowing that he can't be drop because of age or pre-existing condition. thank you for the privilege of appearing before the sub committee. i welcome the opportunity to answer any questions you may have. >> thank you, mr. wadleigh. i recognize myself for five minutes. i'm going to ask a number of questions, so please answer them quickly, if you could. first i want to ask each of you if your state has spent any federal establishment dollars for your state exchange. >> allen? >> i do not believe so. >> ms. o'toole? >> no. >> mr. gutierrez? microphone please. >> we have not spent outside any written authority from cms. >> mr. kissle?

>> we have one item that we are trying to reconcile with our auditors before spending it. it's in a segregated account. >> mr. lee? >> we are spending establishment funds to continue the final establishment of our exchange, federal dollars, but no operational funds. >> mr. wadleigh? >> no. >> can i ask each of you what your operational costs are this year for the exchange, mr. allen? >> for the current state fiscal year which began july 1st, our operational costs are about $12 million. >> ms. o'toole? >> thank you, mr. chair, sorry, i'm having trouble with the microphone. we are about the same, and i'm happy to provide the committee with a full balance sheet of our budget. >> thank you. mr. gutierrez? >> we are still in a very much a build year. our operation and billed expenses within the kerkt are on the order of about $65 million.

>> mr. kiss el? >> a little over $8.5 million. >> our total budget is about $330 million. i don't have it off the top of my head >> and mr. wadleigh, would you know? >> our total budget for the year is $28 million. and roughly $18 million of that is dedicated to operational costs. >> so, with all that, and i would appreciate, this committee would appreciate if we got more detailed odditied information as to what your costs are. i'm curious, have any of your states worked out what it's costed per enrollee? mr. allen? >> yes, our exchange is funned entirely through an assessment on -- >> no i mean in terms of how many enrollees does your state have? >> right now we have 107,000. >> and how much have you spent so far for operational and establishment expenses, state

and federal money? >> are you referring to since the beginning of the program? >> yeah. >> i believe that's on the record of $305 million. in federal grants, and there's a bit more now. >> if you added state to that as well. >> i would have to add state as well. >> you can get that information for us? >> ms. o'toole? >> you have to keep your microphone on. >> i'm very sorry. mr. chairman, i'm happy to provide you a balance sheet. we can e-mail -- send that to the committee right away. >> mr. gutierrez, do you know what you've spent for established and operational costs per enrollee? >> not offhand. we'd be happy to provide that. >> mr. kissle, do you know? >> i do. it's a very large number. over $50,000. but i want to point out with respect, chairman murphy, it's like saying that the first year's use of a freeway is only for the people, the cost of the entire freeway is only for the people who use it for the first year. >> i got that, mr. lee?

>> we have no the done a per enrollee cost, but i note that we've managed over $10 billion of premiums in the first year and a half, and we anticipate over $7 billion in premiums next year. and the $1 billion from the federal government have established -- >> i need to know in terms of your establishment operational costs per enrollee, do you now that number off hand? >> no i do not. >> mr. wadleigh? >> no, i do not. >> i know different costs up front. but of your states, who's keeping and who's turning it over to the federal? who's maintaining your state exchange? oregon you're getting rid of yours, right? >> queewe're using the federal. >> ms. o'toole? >> keeping minnesota. >> retaining massachusetts. >> moving to healthcare.gov. >> california's managing our system. >> connecticut is keeping our system. >> you're getting less and less

federal subsidy, right? so that will mean more and more to the states. so that's going it continue on. mr. kissle, in your testimony you were critical of project hawaii. >> when i joined in october 2014, i examined the project which had had a miserable track record, and i admit that. and i looked at the project management tracking tools, and they were virtually nonexistent. the project was not tracked. it really defined what the end game and goals were. and i was very disappointed, because i came out of the infrastructure business. and i worked for companies that built projects. we built roads, bridges, bases and bombs for the departments of transportation and the department of defense. and these departments had extensive resources for tracking, monitoring and

verifying project progress. >> from some of the testimony it sound thes like it's all re rainbows and unicorns. it's not rainbows and unicorns. it was a mess. there was some mess ups here. some big ones that cost taxpayers billions of dollars, and we'd much rather hear from people who say yeah, let me tell you the problems and how we addressed it. >> thank you, mr. chairman. mr. allen, yes or no, are you denying that your exchange had problems? >> no. >> ms. o'toole? >> no, i'm not. >> mr. gutierrez? >> no, i'm not. >> certainly not you, mr. kissle. mr. lee, did your exchange have problems? >> absolutely not. ours had some problems on the way. >> mr. wadleigh, i don't now, it

may rainbows and unicorns for you. did you have problem withes? >> yes, we did. >> what we're talking about here is how do we recognize those problems and move forward to focus it. i start with you, since you're our model student, mr. wadleigh. if you want to talk very briefly about what problems you saw and what you've done to move through those, i think that would be very instructive for us. >> thank you for the question. so i think, as we've looked at the challenges from the onset of this very large project, which really, it was. we saw some of the challenges being time wise. we saw some of the challenges being management of scope. could we deliver everything that we needed to deliver for me in a

ten-month period? no, the answer was we couldn't. so we went back to the drawing board a number of times to review everything that we needed to implement for the october 1st, 2013 time frame and deferred functionality out to later months for us that we knew that would not impact our customers. and ultimately that came back around as some of our key decisions that we made, unbeknownst to us, that's really -- >> and are you continuing to try to refine and improve the efficiencies in your system? >> every day. we -- >> thank you. mr. lee, i only have 2:57, so could you answer the same question? >> yeah. very briefly. very tight timelines for a big i.t. build. >> timelines were a big issue. >> absolutely. >> were they a big issue for everybody else? yes. >> yes. >> mr. allen? mr. gutierrez? >> i was not there, but it's my

understanding yes. >> the other big problem that i know we all had to address was consumer misinformation and disinformation, the afact of the availability of affordable exchan exchanges. this is a huge challenge. we're working with literally 12,000 insurance agents, faith-based groups, but that outreach challenge is something we've addressed but continues to be a challenge. >> that's true in my state of colorado by the way. mr. kissle, you've been there about a year now? >> yes. >> what did you do before that? >> i was in the infrastructure business, most recently, i ran the gas utility in hawaii. >> so have you of seen a utility or system like this that didn't have issues that continually had to be addressed and updated? >> absolutely not. and the way you do it is take the connecticut model and perhaps the california model, and you roll it out gradually. you increase functionality.

when we first started to make airline reservations we couldn't get a seat assignment online. now you can get umbrellas in our drinks. >> it costs extra for those umbrellas. mr. gutierrez, your state had a lot of issues, what are you doing to remedy those issues. >> i have a belief that large i.t. projects really need strong governance, and we tried to address governance. >> ms. o'toole? >> thank you. some of the same things that you've heard already. we in minnesota early on took on two self-evaluations of ourself to make sure we identified problems and could focus resources where they needed to be. and we have made tremendous progress in two years, and hundreds of thousands of minnesotans have enrolled with relative ease now. we also put in much stronger governance process and procedure in place.

>> mr. allen? >> thank you,. 's mention as i mentioned, i've had control for 90 days. >> so you've focof fixed the wh. >> yeah. to put this on a different path, we're now laser focussed on delivering marketplace services in an efficient and furngsal way and moving forward that way. >> thank you. thank you very much mr. chairman. i yield back. >> mr. griffith? >> i know we're talking about state exchanges today, about this time two years ago we were arguing whether the federal system was ready to be unrolled with its plan, and so forth. and i noted with some interest, mr. kissle in your written testimony, i quote, i'm pleased to say that as of june 2015,

according to turning point, our independent validation contractor, we were the only state-based exchange to have succ93ully passed a testing scenario providing third-party validation that we have a working i.t. system. mr. chairman might want to get the federal folks in here and see if they can pass that same kind of test. and i think it's interesting that hawaii is the one that has passed it. not withstanding that success, not withstanding a ten-year plan to get the finances in order in june, the governor decided to shut down hawaii health connector and also not withstanding, i should note, $205 million in federal establishment grant dollars. now for folks back home, that's the money to get started on the program, isn't that correct? the state health exchange? >> that is correct. now we've committed or spent

only $140 million of that and don't have plans to spend the entire $205 million. >> you're not going to spend the rest of it on establishment. where does the money go? come back to the federal government? >> some of it we don't plan to spend. about $5 million to $7 million will be spent on decommissioning and shutting down the system. then additional money on new enrollments for policy year 2016. >> for enrollment. >> the outreach for establishment to greater increase the enrollment. >> how much do you anticipate that la will be? >> it's about $7 million. >> so you're going to have tens of millions left over. what happens to that money? does that come back to the federal government or to the state of ooiz. >> it remains unspent. it's not drawn from the federal government. >> thank you very much.

is hawaii undergoing a rate increase for health insurance plans? >> yes, they are. the two main providers, the blue cross blue shield provider has announced a rate increase for qualified health plans of about 46%. >> wow. >> and keiser has announced an 8% increase. >> so one's got a 40% and one's got an 8%. which one's dominant in the market? >> blue cross, blue shield has about an 85% market share. >> do they cover the entire state? >> yes. >> does keiser cover the entire state? >> virtually the entire state. some of the rural areas they don't. >> we've heard testimony that except for rural areas, and i guess hawaii would be a rural area for most of it, there aren't that many players. >> that's correct. the average working person, it's those two players. >> do you know of any states who

have higher than a 46% increase? >> i do not, but the reason for this is we, we have a really well-balanced insurance community and it's been 50 years in the making. and when the affordable care act policies were introduced, the insurance companies experienced a lot of negative selection. the sickest people enrolled first. we're a tiny little state with a very fragile economy. many of our businesses, and we don't have national players in hawaii, need that, need that extra protection to provide the safety net that we have against sars outbreaks and other, you know, the swine flu and other kinds of things that are devastating to a small economy like ours. >> appreciate that. i noticed in the testimony, i believe, mr. wadleigh, that you had indicated that the rates for our most affordable plans have remained flat. and that raises, in my mind, as a former practicing attorney, if

your most affordable plans have remained flat, you don't tell me about the others, does that mean everybody else is getting a big increase? >> so all of our plans, both on and off the exchange are, have to have the same rates, so the benefit, the state-based marketplace has created has allowed, forced the off-exchange plans to fall in line and have to be more competitive as well. >> so, your affordable plans have remained flat, but you have some other plans that have not remained flat? is that what i'm reading? that's the way i read that. >> sure, sure. so there are always going to be plans, when you get into the platinum group that are much richer. >> and i apologize, because i see that my time is up, but i will note that you are not claiming that the plans went down $2500 from what people were paying before. i yield back. >> gentleman yields back,

recognize mr. yarmuth. >> thank you, mr. chairman, and i think all the witnesses for their testimony. i'm not going to talk about rainbows and unicorns. in kentucky we prefer to talk about thoroughbreds. kentucky has had one of the truly successful and mostly problem-free experiences with the affordable care act in our exchange called connect. and our govern and his team deserve an awful lot of credit. we had a glitch the first morning of the operation of the exchange for about two hours, and access was limited. beyond that, we've been pretty much problem free. and our experience is that we have insured now more than 500,000 people under the affordable care act through our exchange and expansion of medicaid. in the two years of operation. and that's in a state of 4.4 million.

we've reduced the uninsured rate by 50% statewide. in my district, we've reduced the uninsured rate by 81%. there are only slightly less than 20,000 uninsured citizens in my community of 750,000, which is a little less than 3% uninsured rate. so how's that happened? it's because of the outreach that we all talked about. connect had people in every county fair and every neighborhood social meeting at the community health centers, you name it, where people gathered, they were there explaining and helping people enroll. so i'm very proud of that. as a matter of fact, it's been so successful in kentucky that one republican state senator has suggested that we try to expand the exchange to other states. so we may be coming after your business pretty soon. additionally, just since i get to act like a witness here and talk about our experience, we do have this year three new insurance companies coming into the exchange, which is positive

now. our consumers will have, i think, either six or seven choices of providers, there are three new insurance companies in the private marketplace. so the market is actually expanding in a lot of ways, and i think most importantly, earlier this year our governor commissioned the deloitte firm to do an assessment of what the economic impact of the affordable care act would be over the next five years. and die loit came back and said that over the next five years the affordable care act would create 40,000 new jobs in condition k kentucky, would create additional economic activity of $32 billion. and an impact over the state of $800 million. i think in virtually every sense of the word, the connect operation and our experience in conditi kentucky has been very positive. we've had screenings for breast cancer increase by 111%.

cervical cancer by 80%. and physical exams are up 187%. but all of this is really not as important as the human impact, and, as ms. o'toole mentioned, a couple of her clients, like to read a letter from one of my constituents, a woman named kim adkins. and she wrote, my dau ter sarah adkins is one of the young adults on our insurance policy until she is 26 years old. he is still unemployed and looking for employment. on january 9, 2011, that bill, the aca, saved her life. one of her kidneys shut down and almost went septic. if she wasn't on our insurance, she would have waited or not gone to the hospital at all. the doctor told her if she would have waited an hour later, she would have lost a kidney or died. that's what this is all about. this is providing quality,

affordable care to our citizen, and i think, very proud, once again, of kentucky and the experience we've had there, the progress we've made, and i thank you for the work that you all are doing in your respebtive states as well, because this is one of our, i think, can be one of the true success stories of congress and the federal government, that we have created this new way to insure americans, thank you for your work and your testimony and i yield back. >> first of all, i'd like to thank all of you for doing what you can on behalf of the citizens of the state that you represent. all of us want access to quality affordable care. that's not in question. and i also agree the states should have more flexibility. indiana used healthy indiana plan as a way to cover our low-income medicaid patients and using a combination of federal funds as well as state funds from hospitals across the state that agreed to kick in so we

could expand coverage in a state-based program that's actually hsa based that is working. mr. allen, state of oregon was awarded $305 million in federal tax dollars, correct? >> yes. >> did they spend all the money? >> a little less than the full amount, but there was some unused grant funding at the end of oregon's term. >> and all of that went for cover oregon? >> all of the money was used to establish the health insurance exchange in oregon which was actually the grants were partially to cover oregon, partially to the oregon health authority. >> so none of the money was spent on anything else other than attempting to establish cover oregon. >> correct. >> so could you provide us with an itemized accounting of all the expenditures of $305 million that was spent? is that possible? >> i can. >> so let it be noted he has agreed to provide the committee with an itemization of

expenditures, and from past history frequently we get one page from people with four things on there. we'd like to have a really in detail itemization of where the money went, that'd be great. also, there are a lot of good things happening out there. and a lot of things that need to be changed. mr. lee, what percentage of your people are on silver plans or above, approximately? >> about 75%. >> okay. so 75% of the people then have no deductible for primary care and 25% still have -- >> but even at the bronze plan in california, everyone in bronze, which is the 60% value have three visits to primary care not subject to deductible in addition to the preventive care. >> thank you for that testimony. because in your testimony you said silver and above. i would like to point out. i understand that the private sector plans are, you know, are

still there. but, you know, federal sub dags of health care plans competing with the private sector makes it pretty hard to compete for the private sector in may a hike was approved to help fund its operations, is that correc operation is, sthaeshs? >> yes, it is. >> mr. gutierrez. at some point massachusetts had to put 300,000 people in the medicaid program, and are all those people still there? when you were working to establish the exchange? that there was a, the template, your website had issues, and i'm assuming all that's been resolved and the people who went into medicaid temporarily are all out of that. >> all of those temporary medicaid members have been redetermined into either

qualified health plans or medicaid. >> great. and ms. o'toole, do you still have a backlog of about 180,000 public insurance renewals in the system? >> thank you for the question congressman. we do not. it has been resolved. >> you do continue to struggle some, obviously. again, i applaud all of you for what you're doing. the goal of our committee is to find out where we need to make improvements. minnesota announced they're going to revert to the old system for medicare because of mirn sure's problems? >> that is true just for a short period of time. and that is we have prioritized that functionality for the very beginning of 2016. >> okay. great. and why, i guess. you've totally turned yours over to the federal exchange now. because the information i have, you've extended it to october 2016. originally health connector was

shut down for insufficient funds. >> the outreach will extend through open enrollment. and then the corporate affairs of our independent non-profit will wrap up. and it will take till october to do the accounting and the like. >> okay. great. mr. chairman, i yield back. thank you. >> mr. tonko, you're recognized four five minutes. >> let me thank all of our witnesses for joining us today and presenting good information. i know that some state-based marketplaces have faced challenges in building and managing their i.t. platforms. these challenges are well publicized. what is less well-known, perhaps, is the efforts that state-based marketplaces have in implementing and tailoring the aca to their own citizens. so i'd like to ask our witnesses, so what is your state-based marketplace doing to ensure that consumers in your

state are receiving culturally and ling westically appropriate outreach as well as health care? mr. allen? we might start with you and go across the table. >> thank you for the question, congressman. that's, in taking over responsibility for the marketplace, that was the exactly the number one question that landed, landed with us was given the success we've had in oregon in driving down the rate of uninsured, the remaining possiblelation is relatively small but relatively harder to reach. and so we have made the decision to move from a wide media broadcast advertising approach to something that's much more tailored that works through community partners, organizations that work in communities of color and other areas, much more targeted kinds of technology, outreach to try to work hard to get to those geographic and demographic

populations that are amongst the hardest to get insured. >> thank you, ms. o'toole? >> thank you, congressman. happy to answer that. what we've learned in minnesota is with the remaining uninsured, like mr. allen said, they are harder to reach. we have 26 statewide grantees who work in every community around minnesota to help reach out to these populations and enroll them. we're really proud of that. and i, we pair them, also, with enrollment centers around the state that are sponsored by brokers. so we're trying to come at it from all angles. and we've learned this is not an easy desis for people. so they need help and they need resources there. >> three principle items. we're focussed on ethnic might yeah, dealing with the hispanic, portuguese and asian communities in pockets throughout the state

that are underinsured. second, our selection of navigators and walk-in centers for this fall is specifically targeted towards underinsured communities. because commute hasmassachusett mandated insurance mandate, they would not share with us. they are able on our behalf to notify uninsured residents of their opportunity to become insured through the state-based marketplace.