diagnosed. washington journal is live at saturday, 7 a.m. eastern. .> next, kathleen sebelius then americans for tax reform hold their annual countdown to tax day news conference. then next week's congressional agenda. >> her department will meet in october first deadline for open enrollment in the healthcare law insurance exchanges. the on yelling marketplace is -- she testified on the president's budget request to the house ways and means committee. this is about two hours and 15 minutes.

>> good morning. the meeting will come to order. good morning, madame secretary. i want to thank you for appearing before us today. the ranking member and i have agreed that this morning to allowed the chair and making -- ranking member to give the opening statements this morning. then we will begin with questions where we left off yesterday. we had the secretary of the treasury here yesterday. we were not able to get through the entire panel, so i will now recognize subcomittee chairman brady for his opening statement. >> than you mr. chairman. thanks for joining us to discuss the president's 2014 budget. one of the top priorities for this committee is to act now, to

save medicare, so that every generation of seniors can count on it. so i welcome to inclusion of reforms to medicare, including paying local doctors fairly so they can continue to treat our seniors, and improvements to the current medicare structure. however, the president's budget falls far short of what is needed to save medicare. its trustees tell us this important program is going broke sooner rather than later. the white house and congress need to act together now. this year, to save medicare for the long-term. i challenge you to save medicare for its own sake. not conditioned upon tax increases from hard-working americans to has nothing to do with medicare. this committee will act at the direction of chairman camp. we will examine bipartisan solutions to save medicare. some supported by the president. i invite you to enjoy this

committee in working toward long-overdue actions that protect and improve medicare. both republicans and democrats connect three that americans the the -- both republicans and democrats can agree that americans need reform that lowers costs, improves health, and protects the vulnerable. many americans are concerned the affordable care act may not be able to deliver. they have real concerns about how the law will affect their personal healthcare. that the presiden't law will cause healthcare to go up. while the quality of care goes down. this white house repeatedly promised it would lower costs by thousands of dollars for individuals and families. that americans would not lose their health insurance that they have in life. yet, you've recently admitted at the mandates in the new law will make health care premiums more expensive. this week he warned that americans will lose the insurance they get at work. clearly, the law is not helping families or local businesses.

this budget does nothing to offer them relief. to add insult to injury, as our economy continues to struggle, and americans have given up looking for work, the healthcare laws resulting in fewer jobs and frozen wages. it is forcing local businesses to replace full-time jobs with part-time jobs. in one survey, over 70% of small businesses said that the president's health care law prevents them from hiring new workers. prevents them from hiring new workers. another study found it would put more than 3 million jobs at risk in the franchise industry alone. as one small business man stated, "i am convinced the primary reason we aren't seeing a robust economic recovery is the uncertainty and cost associated with this health care law." in a plant that toured in texas, the company owner told me that the extra healthcare costs is equal to opening two new plants, and adding 100 new workers.

our local businesses and their workers are worried. they are asking why are my health care premiums going up? why am i losing the healthcare i have? why does washington keep piling on red tape? these are serious questions i hope you can answer today, madam secretary. on top of the $2 billion already set to set up the bureaucracy for this new law, the president's budget seeks $1.5 billion more, including adding 1000 employees to ensure americans comply with the new taxes and mandates. what we really need are 1000 more doctors and nurses, not more irs agents. finally, will the white house be able to deliver on october 1? this it ministration seems in disarray -- three years after the law was passed, this administration seems in disarray. with just six months to go to

mud no one has any idea how many americans will be forced into the exchanges, how they were operate, what the concerns will look like, or of americans right information will be protected. many americans believe that so far this has been nothing short of an absolute nightmare. madam secretary, we are looking to you for honest and specific answers. our families and small businesses deserve to know. i now recognize ranking member levin for his opening statement. >> no. at this point, we're going to recognize the health subcommittee. >> thank you. welcome. i've enjoyed working with you during the president's first term. i am pleased that you decided to stay. others have left, and i am sure that there are things that might be attractive in leaving.

your willingness to stay and serve the people should be recognize. this is a daunting task that you face. implementing the affordable care act on top of managing medicare and medicaid will not be easy. enrolling millions of people by the end of the year is a herculean task, which is why the leadership he provided so critical. you are experienced, you know what is like on the other end, so it will be very important to have you at the top talking about what happens. the president's budget really is an effort in my view to reinvigorate a search for common ground, and the common good. unlike our colleagues on the other side, the president has been clear on his willingness to tackle the tough issues. unfortunately, it is not mean much when the house republican leadership refuses to engage in meaningful conversation about shared sacrifice or deficit reduction. you just heard that we are three years into this. what they did for the last three years was they would not negotiate, and in fact

republicans have been unrelenting in their zeal to get rid of the aca, even though it is the first series and successful attempt to ever curb healthcare cost. is projected to reduce the deficit, even with its benefits, by more than $1 trillion over the next two decades. despite 33 house votes to repeal, and the presidential election results, their efforts continue. we know they will not get rid of it. they know they will not get rid of it. john boehner even said the other day the it is the law of the land. they also know that there is one more -- they also know that there is more than one way to skin a cat. the best way to secure a government that will tax regulate them is to create government that can't do anything. starve the programs, and the people will fight for them. --starve the programs, and the people will not fight for them.

the sequester cut 8% of the program for cms, a direct hit to aca implementation efforts. it was obvious they didn't. -- it was obvious they did it. it is medicare as we know it for people kneeling -- nearing eligibility by turning it into a touching program. -- by turning it into a vouching program. ironically, the cbo says the voucher proposals would lead to higher national health care spending. we have dealt with access with the aca. we now have to deal with the cost. the is what is the implementation that we are going to be into presently breed their policy is not a clever one. it is not lead to better care. it is not ethically responsible. in contrast, our medicare reforms were based on reality, not rhetoric. through our efforts, the growth rates are historically low, and projected to remain so for the

perceivable -- foreseeable future. solvency was significantly extended. new payment and delivery system reforms, which will create a program that favors value over volume, and helps drive the right cost, the right care to the right patient at the right time. it has not been easy. that is why i am glad you are still here. no one is better suited to the job. you understand the importance him and the complication of state partnerships. we're asking for what you need. $1.5 billion to get insured -- uninsured americans healthcare, to establish sustainable spending, and tackle the number one cause of personal bankruptcy. that is a bargain at $1.5 billion. they are to be commended, because they have worked tirelessly to improve changes that overhaul nearly every medicare payment system. we are creating a new infrastructure on the promises

of aca, and they have done it on a shoestring. we know you don't have the resources you need. the job has been made harder by false and misleading attacks by opponents. enough is enough. it is time for your -- my republican colleagues to work with us in the ministration to ensure effective in limitation with the american people have demanded, a simpler, more fair health care system that is established by the affordable care act. they had four years of advertising against it, and they reelected the president overwhelmingly, because he put it in place. i hope that today's conversation is productive to start the eventuality and i look forward to the discussion. >> thank you. welcome to the ways and means committee. we have your written testimony. you're recognized for five minutes. >> thank you chairman camp and ranking member levin, subcommittee chairs.

thank you, ways and means committee for the opportunity to discuss the president's 2014 budget. i think this budget directly supports the overall goals of the president read by strengthening our economy and promoting middle-class job growth, it ensures of the american people will continue to benefit from the affordable care act. it provides much needed support for mental health services, and takes steps to address the tragedy of gun violence. we are proposing to strengthen education for our children during their critical early years, to ensure they can succeed in the 21st century economy. the budget secures america's place as the world leader in health innovation so the it remains a magnet for jobs in the future. it helps to reduce the deficit in a balanced, sustainable way. i look forward to answering your questions about the budget. first i want just to share a few

of the highlights. the affordable care act is already benefiting millions of americans. our budget makes sure that we will continue to implement the law. i supporting the creation of new health insurance marketplaces, it will ensure that starting next january, and americans in every state will be able to get quality health insurance that fits their budget. our budget also addresses another issue that has been on all of our minds recently. mental health services on and the epidemic of gun violence. we know that a vast majority of americans who struggle with mental illness are not violent. recent tragedies have reminded us of the staggering toll that untreated mental illness can take on our society. that is why we are proposing a new investment to help ensuring that students and young adults get the treatment they need, including training 5000 additional middle health professionals to join our behavioral health workforce.

our budget also supports the president's call to provide every child in america with access to high-quality early learning services. it proposes additional investments in new early head start partnerships. it provides additional support to raise the quality of programs, and provoke -- promote home-based programs for parents. these investments will create long-lasting positive outcomes for families. it will provide huge return on investment. next prepare the generation of americans to succeed in the 21st-century, our budget also makes sure that america remains a world leader in health innovation. the significant new investments this budget contains four nih reflect our commitment to furthering biomedical research that will help create new jobs and advance the cause of the cure is an medical science. the new investment in health it

will help us to continue the said -- they develop of electronic health systems that have huge potentials for improving care coronation and public health. for as our budget invests the future, it also helps to reduce the long-term deficit by making sure that programs like medicare are put on stable fiscal trajectory. medicare spending for beneficiary grew at an historically low rate of .4% in 2012. 4/10 of one percent in 2012. ink support to the successful in limitation of the affordable thatact saving provisions strengthen the program. the president's budget achieves even more savings. for example, it allows low income beneficiaries to get their prescription drugs at the lower medicare rates, resulting

-- without sacrificing their drug benefits. in total, the budget would build on the affordable care act cost- containment measures, generating an additional 370 $1 billion in medicare savings over the next decades. using the deficit, and putting medicare on sounder footing. our budget also reflects our commitment to aggressively reducing waste and fraud in alomar -- in all of our programs. an initiative that last year alone saved taxpayers nearly eight dollars for every dollar that was spent. we are investing in additional efforts to reduce proper matter care -- medicaid and chip payments. what all this adds that too is a budget that will equip hhs to northstar of a

thriving middle class. or promote job growth and keep our economy strong in the years to come home a well hoping to bring down the long-term deficit. i know many of you have questions, and i'm happy to take those not. thank you. >> thank you. mr. merchant is recognized for five minutes. >> thank you. welcome madam secretary. i'm concerned about the impact of the residence health care law on the small businesses in my district. therecently announced delay of the choice option for small businesses in the 33 federal exchanges. the small business majority, a growth -- a group that has been a witness before this committee, your decision a major letdown or small business owners and their employees. operational challenges have been cited as the reason for delaying the choice option. can you please detail exec lee what these operational

challenges were, and the specific problem at lead you to delay the program? yes, i would be glad to answer that. the shop exchange will be up and running in every state in the country in 2014. it is a small business exchange. of their20% more larger competitors for insurance. they will finally have competitive choices, transparency, and ability to leverage the buying power that the large competitors have. the shop exchange as written had two components, one was a choice or business owners, and that will be up and running. the second was an opportunity to offer those business owners been to give their employees a variety of choices of plans. feedback from both

insurance companies and from some business groups indicated that that would be a very hard second tier to get set up your one. what we have determined to do they the federal exchange, can have the full program up and running, because they are just doing one state, every small business owner will have a choice of plans. will have competition and will be automatically in a larger pool with rates that the small congressional budget office has estimated will be significantly lower than what they are able to pay right now. what will happen year to, -- -- thatmaking give the is the only portion is being delayed. >> what led to the decision to delay that rogen? >> it was feedback mostly from insurance companies and others that operationally to trying get

the aggregated premiums, all the choice plans available, up and running year one, was probably going to lead to some major glitches and we really took that advice seriously. all business owners will have an opportunity to have competition and a choice of plans in the small market. offer fromar two, then on the opportunity for their employees to choose among plans. wax due to the delay, do you believe small businesses may choose to completely drop their healthcare coverage for employees and not to pay the fine? >> i do not. what we know is that the employer will have a choice. the employee or why the competitive market for the first time ever. they'll be up and running in every state in the country. with law then says is that the employer, if he or she chooses him a could offer employees a choice of every plan in the

market. that is the phase that will not be in place in the federal market until year two. employer choice will still be bear -- be there. -- they will have negotiated rates. he live transparency. they will have competition, and be a part of a larger pool that they don't have. like steel and is a paid making the same decision - do you - >> no separate -- >> no sir. has hhs made any preparation for how to meet the added cost of providing care for the potential 10 or 12 million

people that might gain permanent residence status under any kind of the immigration bill? >> we do not do anything about what the congress may or may not do in the future. no sir. >> there's been no preparation whatsoever for that? >> we are working with the law as it is right now. believe me, we have our hands full trying to make sure that the law of the land is carried out. >> thank you. time has expired. >> madam secretary, thank you for being here. i want to second my colleagues comments on how pleased we are that you are where you are. it has been a pleasure to work with you through the rollout of this measure, and you and your team has been fantastic. it is going to require that you the restthat as we do

of the implementation. it is disheartening to me that so many people are working so hard to discredit the affordable care act, rather than to make sure that it works, and that our constituents and the american people have access to quality, affordable healthcare. that is another reason why your work is so important. to make sure b get over what i am sure will be a bump in the road woman look aback on this. thank you also for your provisions regarding mental health. as someone who has been working on a gun violence issue, the mental health issue is clearly an important one. i'm glad you brought it up. it is not enough just to say mental health is a problem, and use that as the fear to ignore the bigger problem. it is part of the issue that we have to deal with and funding

for the is certainly part of it. in theecific issue health care reform measure, you mention in your opening statement, that is the audits and abuseth the fraud working withalled the hospital started to figure this out. can you talk a little bit about that? i will leave it up to you. on it.back to me i'm hearing from hospitals, the small ones, where they are having some trouble going through all of the procedures associated with the rac. i reckon eyes we are saving medicare money doing it, i recognize we have to do it, i would just like to know how it , oneing done specifically

education and training portions. >> i think there are two facets of the fraud initiative. one is improper payments. as you know, many improper payments are not fraud. they are mistakes. our clerical errors and their miss coding. -- miscoding. we are adding up the technical support to try and make sure that the bills are submitted correctly, that we pay the proper amounts correctly, that have to tryback and and re-collect that money. the effort that i was commenting on that is really saving about eight cents on the dollar, i mean a dollars on the dollar, the efforts of the president has directed the

attorney general and i to partner on, and has resulted in an amazing collaboration with u.s. attorneys on the ground ,ith state attorneys general and members of the justice department, and really ramping up the prosecution of individuals who are bent on stealing healthcare dollars from consumers. we have had an unprecedented taken of not only operations, sting operations, but returns to the federal treasury in both medicare trust fund payments and medicaid payments to the state that is resulting in making sure that people understand that this is a bad way to still money from the government. a bad way to still medical services. we are holding up a mandatory request for new resources would be granted.

it is one of the single best , and we have three years of a very impressive track record to share. we would like to wreck -- ramp those efforts. >> would you get back to me on the education and training peace question mark >> i would be led to would you get back to me? >> i would be glad to. to get to the issue of the navigator program. you really spill in an area rules. -- you released preliminary rules. while hhs has not released the estimates on the total number of workers that we will be hiring, it has been reported that a california is requesting 21,000 of these navigators, the $5-cost taxpayers one point

billion in california alone. has any other state release stimates on -- >> there are two issues. the funding that was released by our department is aimed at these say -- the states where we will be operating a federal marketplace. that is not california. it is going to have a state- based marketing california. resources were pay for the california navigator program ray this is a effort to make sure that the uninsured americans, some of whom have never had insurance before, are aware of the law. and have some assistance and help along the way to understand the benefits and make some good choices for themselves and their families. we do not have a salary scale

set in the funding proposal greeted we're trying to make estimates of a range of scale that was recommended to us by community groups on the grounds, and others. that is not an hourly rate that is set. >> so you do not have an hourly rate at this point in time? >> we do not. we try to estimate and amount based on what we found community workers and community groups charging on the ground -- we will be looking at -- on the ground. have those states, that chosen to do their own exchanges, they will be paying for their own navigators. for those that you go in, that you will run as a federal program, you will pay for the navigators? >> yes. >> been appointed to the

assistance. they're going to get grants. >> the states that have >> the states that have chosen to run their state-based skanks have planning dollars available to them and operational dollars for year one until they are able to be fully up and running, where the fees for the insurance companies operating in their exchanges will take over operational costs. so they have planning dollars available within the affordable care act. this grant announcement is for the state that's have -- that we will be operating a federal marketplace. >> ok, so it's a very complex application from what i understand. it's about 15 pages long, run by three different agencies. is there a way to take some of the complexity out of the application -- >> we're talking about the navigator sflicks >> no, application for someone

to apply for the program itself, to get into the zhanchings. to -- >> get health insurance? >> that's right. >> first of all, we're working hard to i think make the application as user friendly as possible. and just to give a little perspective, because i have seen some reports about how daunting this will be, we looked around the country be the average health insurance application, if you would go get a paper file from california or nevada or georgia is in the 20-page range. a life insurance application is about 23 pages long right now in the market. we're trying to actually make this a much more user-friendly proposal. what we know is this will again on how complicated the family situation is. if someone is single looking for insurance and has relatively simple tax situation, we think

it could take 15 minutes online to go ahead and apply. if it's a complicated family situation with more information needed, it could take longer and require more information. there's a tension, congresswoman, between making sure we verify correctly the income levels and what is actually eligible. >> i see my red light. madam secretary, what i would like to also know that i will not have time to ask, but if you could send to my office in writing, i want to know what the educational qualifications will be for navigators. i also want to know why the brokers that are already educated in insurance are not going to be eligible to be a navigator. so if you could just respond back to my office for that, i would appreciate it. >> be happy to. >> thank you, mr. chairman. >> thank you, mr. chairman and madam secretary. welcome to congress. sometimes it must seem a little

surreal for you because you hear -- you hear tales of whoa and doom and gloom and all of the problems of the health care system, all of which were very much in evidence for ten years before we passed the affordable care act. and you have made clear in your many presentations about the changes that are already under way. the reforms are making a difference. costs are going down. it's not easy and it's been made harder because this congress chose instead of working with you to excel rate reform, chose to kill wind mills, attempting to repeal it and cutting away at the resources you need to do a difficult job well. i find no small amount of irony that a congress that could not summon the courage to close military bases, instituted independent commission to help them.

now, there are howls of outrage there could be an independent commission if f congress doesn't do its job dealing with health care reform costs in the future. but i have two questions that i would offer up for you. one deals with the notion of where we are in terms of actual health care savings. it's been documented by independent sources that health care reform will produce approximately a trillion dollars worth of net budget savings over the next 20 years. there's work under way. and i again deeply appreciate the flexibility and partnership of the department working with my state in oregon. accelerating those reforms and if successful, and it's tough but it looks like there's an opportunity, it would produce savings if they were taken on a national level that would

achieve over a trillion dollars in ten years. my first question would be you might comment on some of the reform opportunities that you see in oregon and elsewhere. my second question, and i don't think there will be time to get into it in the five minutes i have, and i would welcome a written response, deals with some of the areas that don't have to be partisan that we could move on quickly to accelerate reforms. i have suggested to my colleagues on the health sub commit write we can take, for example, a piece of legislation. i'm honored to co-sponsor with my friend that would have a secure i.d. for medicare recipients. might countdown on fraud and mistakes. i have bipartisan legislation that deals with end-of-life care. 90% of the american public actually support having some assistance helping them navigate those difficult challenges.

we have bipartisan legislation with dr. rowe, with mr. hanna, dr. mcdermott, that would give what 90% of the people want. it's supported by the hospital situation insurance companies, ellen goodman's conversation project that will be coming to washington, d.c. next year. i would like to know in writing if we can work with you and your department to try to make some progress helping americans be able to deal with the challenges they face at end of life and making sure they know their choices and that whatever those choices are they would be respected. i appreciate that in writing. maybe you can talk about health care reform in the remaining time. >> thank you, congressman. i think that while there is a lot of attention and focus on what's happening in the insurance market, which will a relatively limited

number of americans, what's going on in the delivery system that the authors of the affordable care act and those who supported the affordable care act wrote into the bill is to me the most exciting and has the biggest potential for long-term gain. and it really deals with delivery system reforms. that affects everyone. whether or not they have coverage now. whether or not they will be in the new market. whether or not they will have new choices for insurance. oregon is one of the country's leaders. no question about it. but we're also seeing a number of other states. we're working close with arkansas, with massachusetts, with others who are really rying to do a couple freight forward things, better patient care. better protocol when the patient hits the health care system. better public health so looking at prevention programs that actually lower costs. d care improvements that

improve the deficit and lower costs. what we are seeing is pretty dramatic improvements already. and there is real hope that those kinds of system changes not only ce long-material financial benefits but long-term health care benefits. america still spends almost twice as much as any developed country in the world. we have more uninsured then any developed country in the world and live sicker and die younger then moat competitives. that's not a great formula for a global competition. >> thank you. time has expired. mr. young is recognized for five minutes. >> madam secretary, thank you so much for being here today and thank you for your service. today you have assured this committee that the exchanges

will be up and running pursuant to the affordable care act on time and functional october 1 of this year. encouraging it here because it is in fact the law. i do know there's a lot of anxieties. with my constituents and other stakeholders about this matter. there's also some anxiety with the release of this budget. certainly anxiety i harbor about the cost of these exchanges and said implementation. the president's budget has h.h.s. spending $1.5 million on exchange grants in 2013. that's an increase the over $300 million compared to last year's estimates for fiscal year 2013. despite the fact most states have chosen not to create their own exchanges. the budget also anticipates an additional $2.1 billion spending exchange grants physical year 2014. through the original law, congress appropriated $1 billion

for implementation but you, madam secretary, were also given unlimited authority to fund state exchange grants through 2015. now, press reports say there's about $235 million left in the law's original implementation fund. can you confirm that number or tell us how much the department has spent on the exchanges so far, and from what other funding sources these expenses are being funded? >> well, sir, i think that if i heard correctly there were a lot of numbers in your question. you conveyed it fairly accurate picture. when this bill was passed in 2010, the congressional budget office estimate was a $10 billion administrative cost to full implementation of the law. and you are correct in the law itself there was $1 billion appropriated.

a tenth of what the nonpartisan c.b.o. recommended be the cost. i think we have done an extraordinary job, frankly, here in the 2013 allocating and using judiciously the $1 billion that we had. we do have about $230 million of those dollars left. we will use those and some additional resources in 2013 and we have asked for additionally $1.5 billion in 2014 and that's really to get the i.t. hub, the call center, the i.t. up and running and have -- >> i'm aware the significant logistical and information technology challenges of this, some would say that the design of the project may have been too ambitious but nonetheless, certainly sensitive to that and all of the good people who are working on such implementation. >> then i think the good news is

we're well under what the budget estimates were. >> but a billion dollars was originally that was authorized in the original law. >> that's correct. >> that congress provided. that's with -- it was said was required by this body when it passed the affordable care act. but we have a doubling of the projection for setting up the exchanges by congress and this is with half -- i want to emphasize, less then half the states participating. and so i guess, you know, i have a concern if more states did participate, that would cause the cost to explode even further. is that your estimation? >> no, sir. and in fact i think that characterization is a little bit misleading. states and t now 31 district of columbia running all up and coming

marketplaces. two-thirds are engaged. some are not running the entire program. running plan management part or consumer outreach or both and they're running the entire thing. in the remaining states, we will be setting up the entire exchange as a start. but we're actually in conversations with lots of states who said we would really once this gets up and running, taking over. >> finally, if we don't receive the additional funding requested, is this going to preclude the ability to launch the schanchingses on time and if not what is your contingency plans? presumably there is one. >> we are confident we will launch the exchanges. we will be open for open enrollment october 1. the hub is basically built and paid for and will be using the remaining resources that we

have. we are using every opportunity we have to look at my transfer authority within h.h.s. and dollars that we have. you're absolutely right. we have a law that is law of the land. the supreme court confirmed its constitutionality. there are millions of americans looking forward to the benefits and and we have requested additional resources to make sure we can reach out to folks who need it. >> my time has expired. >> thank you. madam secretary, thank you so much. we do appreciate your service and i think outside of the president and perhaps speaker boehner, you had the toughest job in washington the last four years. it may get a little tougher when we go into crucial phases of implementing the affordable care act. just today i think it's a little bit refreshing we have some colleagues on the other side that are concerned about h.h.s. moving too slowly in the implementation of the affordable

care act. i shire mr. marsh's concerns about the delay in the shop act, in particular small business owner and small group market. i want to ask you a question in regards to sustainability and cost containment we're starting to see with these reforms being implemented. i think it's a great story that really hasn't been told and the slaw starting to slow down the growth of health care costs. for instance, u.s. health care spending grew at 3.9% the last three years. this is the lowest growth rate in over 50 years. medicare per beneficiary spending rose by as you pointed out in your testimony .4% in 2012. medicaid beneficiaries spending actually dropped by 1.9% in 2012. one of the great untold stories that happened a little over a month ago, c.b.o.'s recalculation in the ten-year cost figures on both medicare and medicaid. and c.b.o. determined both medicare and medicaid will now spend $700 billion less over this next ten-year period then

previously estimated. medicare will save $382 billion reduction in spending. roughly 3.5% medicaid, $239 billion reduction and he question will be whether this is sustainable but there are also more instances of cost containment and cost recapture that you and your department have already gone after. nearly $15 billion in fraudulent medicare payments are being recaptured now because of the beefed-up authority and enforcement we give you under the affordable care act. hospital readmissions are down $75,000 and hospital base infection rate is fourth largest hospital expense so we're starting to move the dial in that area. the law already led to nearly $2.1 billion in savings for american consumers being overcharged and regates going out right now. and health care law provides $250 million in health insurance rate, review grants the states.

their using that oversight review of premium increases, which is having real impact. growth of private plan premiums is slowing. this hasn't been a story told that much. annual premiums for employer sponsored family health coverage is down by 4% in 2012. lowest rate except for one of the last 13 years. and so this is a real progress when it comes to cost containment, especially in budget deliberations where health care spending is the largest and fastest area of spending we have in the federal budget. we are seeing real progress right now. we have 250 new affordable care organizations with new model of delivery system and payment reform so it's quality not quantity-based payments anymore. and i also find it striking that the president's budget before us today actually finds more savings in medicare over next ten years then republican budget does. and that's because we understand the support we move forward on reform, we don't have luxury of waiting ten years before we start reforming the entire

health care system. we have to be doing that now and it has to be a comprehensive holistic approach. this is a tremendous success at least initially in the first three years of the passage of the affordable care act. i'm wondering in your opinion with the recalculation of cost reduction, is this sustainable with structural reforms happening or remanent of the great recession that we're coming out of? what are you seeing and what's your opinion? >> i think that you have enumerated what is a snapshot of what's going on, in spite of some reports to the contrary. there is a very, very positive story to tell on cost reductions. cost improvement, on carom provement and that is with additional benefits for medicare beneficiaries w. additional people insured, with additional coverage in the marketplace. so that is not sacrificing the beneficiaries to get those cost

savings as some would do in plans but it is really enhancing the benefits that people are receiving. i think we have a great opportunity with the kind of delivery system reforms again that you, mr. kind and colleagues made sure were part aft affordable care act from the outset. driving towards a valuable-based payment system, looking at strategies to make sure medical proceed col was appropriate and paying for that. reducing the kinds of costs that come with avoidable hospital readmissions that are built into the system and, frankly, having insurance coverage under a vast majority of uninsured americans will be another huge step forward. getting to care treatments at much less expensive point in time. making sure that people don't continue to access emergency room care at a more expensive, least effective point in time and really working on prevention

efforts around obesity and smoking, which are beginning to show, again, positive signs. and we have enormous potential to make sure cost containment strategies continue into the future and that health improves for americans at the same time. >> all right, thank you. mr. kelly's recognized. 1 >> thank you, mr. chairman. >> good morning. >> thank you for being here. good to see you. what are the questions i have back home, there's a company called healthsouth that does impatient care. when it comes to market baskets cut through impatient, rehabilitation facilities, is there any policy behind this or is this just a cut? the market basket, is that something a term you're familiar with? >> yes. >> i want saying it to be funny. there's so much here that we ssume everybody knows. but for people who build their

economic models based on future payments, it makes it difficult for people like healthsouth to develop any kind of business performance. what was the policy that drove that? >> congressman, i think there's an enormous amount of analysis of the health system that goes on with every market update and every market basket proposal. nd it really looks at cost outwires, looks at the way services are used, looks where we're seeing aggressive up-coding in some instances to try to recover where regions of the country that have tremendous differences without care variations. so i would say there's an ongoing, enormous analysis. john blum, who is sitting behind me, is the deputy in charge of medicare services and as you know with each market basket pdate, there's also a public

display and a lot of feedback. we're always trying to balance effective cost strategies with beneficiary needs. >> i think that's one of the things looking at the patient affordable care act. attention is the word great. the reality is staggering and uncertainty of it. it's the unknown part of it. budget keeps changing and costs keep changing and as wonderful as the product was supposed to be at the end, it's almost like if you don't know where you're going, any road will get you there. so we find we attack providers. i'm back home and i'm talking to bhome have independent hospitals, healthsouth what they're doing, when we continue to say the problem is that the providers are making too much money, we have to find a way to dial it back. they're making too much money. so i have to tell from you being private sector my whole life, i have never been in a situation where you just don't know what it's going to cost you going into the future. one of the things patient

protection affordable care act has done, don't think this is intentional, it has driven a wedge between employers and employees. owners of the business and associates. it's forcing people who had long-term relationships, baptisms and bar mitzvahs and weddings and funerals and portraying the owner of the business as someone who doesn't want to do something for his associates. a lot of my friends, bill patterson back in erie, for example, has a lot of employees. you what he has to do to meet this? he has to make them part-time employees. when i looked at a work week, i thought 40 hours was a work week. no, it's 30 and it may get down to 10 or 15, whatever we need to make numbers work. this is what bothers me and scares the live dagelights out of small business people because they don't know where they're going. and it's apparent to them the government also doesn't foe where they're going and cost keep escalating and escalating. other then washington, d.c., where all you have to do is pick

somebody up by the heels and smake money out of their pockets. for people who have to go to work every day for a plan to be frost profitable and cost is a huge factor in it because it drives either end price of the service or product, gosh, we've done this people tremendous in service. it's been a disservice all across the board. we're destroying the most important relationship we have. it's the trust factor between those that own the businesses and run businesses and those that work there. and when you destroy that, when you get into the really tough times, when you get into the hard pools you have to rely on each other to get through it, you better believe we're on the same side. i have to tell you, i understand the budget, i'm looking at the budget, all i know is you need our money to do it and we will take care of more people. the reality of it is, ma'am, how many pages of regulations do we have now? >> i can't tell you. >> i have something like 14,000 pages. bill 2,700 pages and still being

written today. so if i were to ask, where do you think this snends where does the merry go around stop? not all of the wonderful thing what's could happen into futechurt but reality of today for people who have to make a payroll, for people who have to keep their associates intact? they trained them, educated them, provided tools and stuff for them and now we're forcing them to separate that relationship that they had and making adversity. they're against each other. that's what i don't like about this. the idea is great. great a. affordable, accessible care for everybody. reality of it is, it's not affordable. it's never going to be affordable. >> time is expired. mr. pasqual is recognized. >> madam secretary, thank you for being here again today. many times you have been here

before. i had a question on the president's brain initiative -- zimes, i'm having -- >> i'm sorry. >> thank you. >> i had a question on the president's brain initiative, one of the investments that i think is particularly worthwhile. aco-chair of the traumatic brain injury task force, i'm well aware of the advances we made in research on the brain in recent years years. retty fantastic. some good game out of the two wars. when we facilitated the effort and excel rated the effort and got d.o.d. to understand what they're responsibilities were. took us a long time to do it but in a bipartisan way we accomplished that. now, according to the centers for disease control and prevention, each year an estimated 1.7 million people

sustain a traumatic brain injury in our country. unfortunately, t.b.i. is a contributing factor to a third of all injury-related deaths in the united states. 30 1/2% to be exact. beyond the numbers t.b.i. has become the signature wound of both iraq and afghanistan. 20% of the soldiers deployed are stimated to have experienced some sort of brain injury so it is clear it can impact anyone at any time. it's really flowed over into the research and developing into sports in our own country. male, female, all kinds of ports. we have seen in our lifetime, nfl finally owned up and doing a great job to reverse what's been a hoar risk situation among

their own players. this is $100 million commitment is not just coming from your department. but can you speak to the goals of the brain initiative for all of us? >> congressman, i think it's one of the exciting next horizons. dr. frances collins, who runs the national institutes of health sees this as the project that has a lot of parallels to the genome mapping project. we need to map the brain. because whether it's looking at alzheimer's disease or the kinds of brain injuries that you have identified that wounded warriors are suffering or concussion that's affect our kids, we don't know enough what is happening to people and how to deal with it. how to prevent, slowdown, rehabilitate, some of these injuries and traumas.

so there is a public/private partnership initiative announced which will include private foundations that are already working in the brain space in the department of defense who has a great deal of interest in this topic as you correctly outline the national institutes of health, where a number of institutes are already doing critical research but could accelerate that further. and really in a shared collaboration do the kinds of multiyear brain mapping, accelerated purest strategy that has been successful in a number of other areas. >> i have seen the help now as compared to the help five, six years ago to our service members and it was a catastrophe in the beginning. which now being saved obviously was not happening five, six years ago and this is

a tremendous effort which many departments involved. how do you think service members are going to be helped potentially in your mind? >> i had the opportunity in the not-too-distant pass to visit amazing research facility at walter reed, looking at a lot of these cutting-edge strategies in terms of rehabilitating the wounded warriors. and i think research going on there, trying to identify what exactly happen when's an i.e.d. blows up and what posttraumatic stress sin dome actually is causing to happen in the brain and how that can be dealt with the future ushes that has clear impact on hundreds of thousands of soldiers who are returning and trying to resume a normal life. the faster we can accelerate this -- we know how to treat their limb injuries.

we know what happens if they have to be stitched up. we don't know nearly enough to the t has happened brain and nerve system. and the faster we can get, the more help we can give. >> thank you. mr. griffin's recognized. >> thank you, mr. chairman. thank you, madam secretary for being here. , ppreciate your service appreciate you answering our questions today. i believe in health care reform. and i believe we need health care reform and what i am particularly concerned about is reform of medicare that my mother relies on. medicare, which is not in the committee jurisdiction. but i'm concerned about long-term permanent reforms. not tweaking at the edges. i believe we need to strengthen these reforms so they will be there for my generation.

i know they will be there for my mother but i am worried about my generation and the next generation. and i am particularly concerned about what we call in washington mandatory spending, squeezing out a lot of the investments we need to make in breast cancer research, n.i.t. research, lzheimer's, m.s., but a lot of people may not realize a lot of that is from the discretionary side and the more, longer we leave mandatory side without reform the more pressure it puts on those critical investments. that brings me to, you mentioned arkansas. i know there's a big debate going on with arkansas and you have been working with governor b.b. down there on medicate expansion or some alternative to

that. my view is we ought to have permanent lasting reforms all over the country. i like what was approved for rhode island in early '09. but i want to ask a few questions specifically about what's going on in arkansas. did you -- i have some of the correspondence with the governor. i know you met with the governor. have you met with any of the legislators in house or senate from arc snark >> i have not, sir. >> would you like to meet with any of them? would you be willing to meet with any of them? >> we really the way the medicaid program run, we negotiate with the state. >> have you seen the bill that is -- >> no, sir -- >> that is floating around? ok. if this bill and votes coming up soon, passes senate, it will come up in the house soon at least the appropriations for it.

the bill itself i think passed yesterday. if this passes have you decided whether to approve it? >> no, sir. >> i zsh has not approved -- >> i'm a former legislator, former governor. as you well know anticipating what any legislative body may do before he this do it probably not a very beneficial expenditure. >> i'm familiar with that. staff hasn't seen, bill's been published? >> i assume my staff is in close touch with the arkansas staff. again, we have not looked at the -- when the bill passes, be happy to take a look at it. >> got you. >> i am very concerned about how $630 for the estimated

billion that it will cost for med ok expansion. i believe we need to take care of the most vulnerable and i'm afraid we're setting up expectations and making promises that we are not going to be able to keep. i would continue to advocate. ly continue to advocate for long term, lasting, permanent reform of medicaid and i believe you would find a lot of people on this side of the aisle who are willing to work with you in fashioning reforms that will make our medicaid program stronger, same with medicare. extend the life of it and raised the quality of care for people. i thank you for being here today. >> thank you very much. mr. davis is recognized. >> thank you very much, mr. chairman, madam secretary.

let me thank you for appearing but more than that let me this you and your staff for the way in which you handled one of our most precious commodities and that is health care for the people of these united states. i think you have done and continued to do an outstanding job. i was pleased to note as you explained the options that exist for small businesses, something that people have been trying to deal with for many, many years without coming up with anything that was going to be beneficial or helpful. i was also pleased to note that e exchanges across the board seemed to be on target. that's they're moving right along, not withstanding all of the criticism, all of the efforts that they have been to discredit that approach and to

discredit them. two questions that come to mind. i'm pleased to note health education, health awareness, health promotion, the outlization of individuals to interact with the general public providing them with information, early screening and detection. generate ese things cost savings that are sometimes almost immeasurable. let me just ask you, how has the prevention, early detection screening, these aspects of the plan been working and how are people making use of them? >> congressman, one of the i think very important features in e affordable care act is a

direction to shift from acute care to preventive care and that's contained in all aspects of the bill. so insurance policies in the private market now have reduced the financial barrier for people to access preventive care. no co-pays, no coinsurance for mammograms and colon cancer screenings and vaccinations for kids, things that we know will keep people healthy in the long term or identify a problem early enough that it can be life-saving. medicare benefits now have more robust preventive care strategies, including yearly well necessary checkup and plan to sit down with a health care provider and make a strategy for the future something that we know is benefiting the 54 million seniors who participate in the medicare program. but there are also now community

strategies under way and efforts to really through our community health centers, through community health workers try to prevent hospital admissions by delivering care strategies at an earlierer point getting school-based health clinics into underserved areas so that children are their families have access to care providers. i think all of those strategies are really aimed at reducing the health burden that people feel and that's not just for those individuals. they are more productive workers if they can go to work every day. they are more productive parents if they don't suffer from an illness. they live longer lives. they're more productive in their community. so this has an economic benefit beyond just the individual family and individual patient. it has an economic benefit for communities and our country. >> let me ask you, how have young people, young adults been making use of the provision they

can stay on their parents' insurance policies until 26? >> we have been, last count i think there are about 7 million young adults who are now enrolled in their parents' plan and over 3 million of those young adults had no insurance at l before this provision came about. young adults in america were second largest category of uninsured americans. and for a number of them, that may have been risky strategy but it was ok. for others who were identified with a serious illness or in an accident or had a health situation, they're facing a lifetime of bankruptcy, they may bankrupt their families at the same time. so this provision that allowed across the country young americans to enroll in their parents' plan has been enormously successful.

>> thank you very much. i yield back. >> thank you very much. >> thank you, mr. chairman. and thank you, madam secretary for being here. thank you for your service. one of my colleagues was talking about small business. i was a small business own are for almost three decades before coming here just two years ago. i know the big of the problems with job and job creators are certainly predictability. i know health care rollout is causing uncertainty and unpredictability. but even in the business world when you have that, sometimes you have to redirect, you have to change and make certain decisions. i want to read to you an e-mail that i received. it's from a work ner my district. he writes upon returning to work, he was told that his hours were going to be reduced from a full-time 40-plus hour a week to 30 or less, which for him would result in approximately 25% decrease in income. the employer mandate penalty raises significantly cost of employing full-time workers,

especially low-skill workers because the penalty is higher proportion of their compensation then for higher skilled worker. would you at least acknowledge that the employer mandate will hurt low-income workers the most and what is the administration's plan to address the laws disproportionate impact on that vulnerable group? >> i would say, congressman, first of all what we know about the market that is -- falls under employer responsibility plan is about 94% of business owners who employ 60 full-time workers or more currently offer health insurance. 94%. if you get over 200 people, it's about 98% currently offer health insurance. we also know they pay significantly more for that policy that they are offering their workers then large competitors do. because they don't have any market leverage. they can't negotiate with a hospital. they can't negotiate with the

drug company to say, we will send you a thousand workers and you discount our hospital beds. so what we're looking at are capturing markets that exist but actually giving for the first time some choices they don't have. they will have competitive plans, transparent plans. they will he no what's happening going in. their workers will not be penalized for pre-existing health condition, which is a huge issue for small employer and they will be able to move forward. employer man this is date only falls on employees who have 50 or more full-time workers and as they say right now, 94% of them are in the market but they're in a market that isn't cost effective for them. >> but you have heard most companies are looking to keep their employment less then 50 employees? >> actually, i have not heard that. i heard a variety of strategies simpson speculation about what may or may not happen.

what we know happened in the one state where this was fully implemented with employer responsibility provision was massachusetts. and in massachusetts, while the predictions were business owners would not drop coverage, people would get out of the mark, just the opposite happened. they have more small business owners in the market today then when the law was first passed. they didn't cut hours or shift rates or drop employment. what i also know talking to business owners across the country is they lose good employees every day to large competitors based on benefits they can or cannot offer 0. this is a huge challenge for small business owners because they can't provide the coverage -- for the first time we will have virtual pools larger then they have negotiated powers, transparency and we think those market strategies will be enormously beneficial. >> i hope you're right. again, small business ownerer and somebody who has small

business friends, touched on colvet it's interesting. when i talked to small business owners back in my district, talking premiums up 52%, premiums up 35%. a lot of studies, oliver wyman's study said many over the age 50 see rates increase. aetna warns premiums would double in some marketplaces. that goes on and on. president's health care plan, at one point in time, was promise of $2500 reduction in family premiums. will that ever occur? do you see the president's promise of $2500 premium reduction for all american families occur? >> again, don't think it was the president's promise but the congressional budget office estimated people would see the cost decrease as we moved into fully ensured marketplace. i think congressman what we know is that the c.b.o. is a nonpartisan objective body. they're looking at strategies in the market. what you are referring to in

terms of current rate increases, first of all is not impacted by the full implementation of affordable care act because it's not in place yet. secondly is really a situation where there are costs going up and down but what we know is that they're rising at much lower rate right now then they did three years ago before this law was passed. insurance departments, many for the first time with aggressive rate review strategies in place. where they're looking at the place, rejecting double-digit increases and so-called 80/20 rule, never been in place before for insurance companies where they have to spend 8 cronets of every dollar on health benefits, not c.e.o. salaries, not marketing plans but health benefits. companies that didn't meet that threshold returned about $2 billion last year to customers. people all over this country got checks back from their insurance

companies. so there are some market strategies in place that are cost effective. >> i think i'm out of time. >> miss sanchez is recognized. >> thank you, mr. chairman and madam secretary. thank you very much for taking the time to appear before the committee today to discuss the administration's fiscal year 2014 budget. budgets simply put are reflection of priorities and our priorities should be very clear protecting seniors in their golden years, giving our children quality education so they can achieve dreams and properly funding health care to keep our families in good health. i was pleased to see that the president's budget does address many of those shared priorities. in particular i was happy to see the president's budget adds $1.5 billion in new funding toim pilot the federally facility tailted and state partnership exchanges that will help provide health care insurance for over 25 million people. the president's budget invests $1.4 billion in new head start

child partnerships, an issue so important for southern california. and it increases funding for the food and drug administration by $280 million to improve food and drug import safety. that it continues to invest in the national institutes of health and it increases funding for vital title ten family programs by $30 million over last year's request. all of those i think are important priorities that i think every american family can benefit from. as working mom i have a rticular soft spot the president's budget and availability and quality of childcare, i hear far too often from parents lack of affordable and quality childcare is the significant barrier to -- for them to work. what i want to really focus in

on is something that's been touched on by mr. kind and other others in passing. and that is the savings that the affordable care act produces. because something that i find somewhat paradoxical if you will is the republican budget that we saw included all of the a.c.a.'s medicare savings and taxes in that budget. so on the one hand i hear from my republican colleagues, they claim the a.c.a. destroyed medicare and levied heavy tax burden across health care. but on the other hand, they passed a republican budget that retained a.c.a. savings. madam secretary, i would be interested in hearing about some of the savings that the a.c.a. has produced and your comments on the paradox that on the one hand folks seem intent on repealing and on the other hand want to retain savings from the a.c.a. >> i think the president believes very strongly as we do in the department of health and human services that keeping our

commitment to the seniors of this country that was made in 1965 when my father officed in this building and sat on the energy and commerce committee and helped to right the medicare law and just turned 92 and he's pretty happy that he did -- >> hime sure -- i'm sure you are too. >> i am. on we are very concerned one hand medicare beneficiaries continue to receive that commitment and that promise. and that we find strategies that continue to look at deficit reduction. and long-term growth in the plan i think that's what is captured in the president's budget. a ways it was part of the affordable care act. $800 billion worth of savings and we are very much on track to fully implement that with additional benefits.

people said you can't do it. it can't be done. you can't deliver good care and cost cut costs. well, i think we're on our way and in year three of doing exactly that. we see that same strategy into the future where you can actually figure out care strategies that work to benefit a growing number of seniors. we have 11,000 people a day turning 65 in this country. each and every day. we have the largest number of medicare beneficiaries ever involved in the program and yet we're on historic low in spending. .4% in 2012. never been seen before and as congressman kind said, the c.b.o. reconfigured their projections into the future years. so i think the president's budget captures the negotiation that there are var very effective strategies that deliver appropriate care, make

sure that we take seniors' needs into account. we continue to update quality programs, at the same time constrain the costs into the future. >> all right, thank you. mr. ryan is recognized. thank you. >> i guess i should pick up where mrs. sanchez left off. the difference in our budget approaches were we make sure all of the medicare money stays in medicare. chief actuary of c.m.s. was here just a year ago saying you can't spend the same dollar twice. you can't on the one hand count savings from medicare to pay for obama care and count it as savings to medicare. he even went so far to put appendix in the report to that effect. the other point is in our budget we put a reserve fund, which is a budgetarry mechanism to address any inadequacies in the community that may arise if the case occurs where we feel like providers are restricting access to beneficiary because of these cuts.

so that's just to answer the difference with the paradox, so-called. i have three questions and i just -- you just released your budget this week, madam. good to see you, by the way, madam secretary. first on the means testing for part b and d, you have in your s-9 tables, you have $50 billion savings associated with that. before we had mute mew chullly agreed on policy $30 billion in savings, where is the delta. where do you make up the difference, $20 billion? >> the difference, congressman ryan, is that there are -- there is a new formula rather then having i think what we're in the past four different categories. it's now nine. the lower limits -- >> the top still 80 or going up to -- up to 90? >> the top is 96. 196. >> no, no. the percentage, the beneficiary

pays of the -- >> yes. it's still 90%. >> 90%. >> more categories -- >> still kicking 80,000 for individual and 100 -- >> i can -- >> 160 for -- >> i would love to get that you in writing just so i can make sure i don't -- >> i really want to know, so -- >> there are more categories and slightly different starting point and different ending point. >> different starting point on income or different starting point on thresholds? or percentage of the premiums that the person bears themselfs? >> the percentage of the premiums the person bears themselves. >> ok. >> yes. all right, $20 billion is a pretty big difference. >> i would be happy to get you all of the details. >> so your medicare advantage demonstration program, which i think scored $8.5 billion where you're offsetting 71% of the hit to the a.c.a. in 2013 and 32 and 16 if i recall, i don't see that here in the budget.

did you not put that in your budget? that's a pretty substantial change in mandatory spending, especially for a demonstration program. is that not in your budget? >> it's in the baseline, congressman. it's still going on. and i think the very good news is we're seeing beneficiaries choose higher quality programs and still very much on track to actually pay medicare advantage plans at the same rate fee-for-service plans will be paid on even faster pace, including the quality demonstration plan. so it's all working very well. >> you're sticking with the formula phasing it out in 2014? >> yes. >> ipad -- i'm sorry trying to watch time here, and i'm not going to ask you to pore through your budget here, but nft past you have not had attributed anything to ipab in your budget before because your threshold of growth rate, g.d.p. plus .5 was above what you estimated cross

growth to be but now you have savings starting in 2021, 2022, 2023, so that ipab is actually starting to score positive savings. how do i interpret that? does that mean you believe excess cost growth at the end of the budget window is starting to perforate, g.d.p. .5? or are there new proposals associated with ipab that accrue savings? >> congressman, there are not new he proposals that accrue the savings except this budget captures the president's belief, which is different then the affordable care act, which is ipab should kick in at g.d.p. plus .5 rather then g.d.p. plus 1. >> that was in your budget last year as well. >> i understand. this is really based on just the actuary's estimate on what will happen in outlying years and when right now as they look at the snapshot into the future, as you just heard the c.b.o. estimates have revised long-term

strategy. i think it can be revised again as we say on sustained cost reduction. but that's just reflection of when they feel that the trigger point might meet. >> that's the question, so the actuary is now saying ipab mandate, keep spending within g.d.p. .5, which last year's budget didn't happen in the first ten years because cost below that, medicare below that. so now that i saying it's triggered and it will occur in 2021? if you could just answer briefly. >> can i get back to you on that? >> yes. >> my understanding is -- >> huge but effects in the out ear. >> i thought the old projection was 19 that ipab would would trigger and it's now moved to 21. i need to check. that's certainly my understanding. >> thank you. miss swarts is recognized. -- miss schwartz is recognized. >> thank you. i'm pleased to have you and appreciate some of the good information that's been discussed this morning.

particularly in relationship through the unequivocal progress you made in the last three years in implementing affordable care act and continuing growth and cost in the private sector and public sefter in between medicare and medicaid. some really important work is going on in this country and i think we moved that dial forward. you have, administration has in really quite extraordinary ways. so it bodes well for the future as we stay on this course. there are a lot of challenges you face. i know in states like mine, where there are real issues where the federal government will have to step in, you're going to have to step in to assure pennsylvanians benefit from the increased opportunity to buy insurance. and i hope we can continue to build on some of the really important work we're doing in some ways on health care delivery system reform. so i wanted to ask you specifically about an issue, i know i have been pushing on pretty actively.

you won't be surprised i would raise this issue but it's one that had some bipartisan support, as you know, repeal of the sustained growth rate, finally making a decision legislatively. i know you need us to do that, which is to recognize that we're not going to implement sustainable growth rate. we should not. we're not going to cut physician reimbursement in this country by 10% or 20% or 30%, which is all possibility, and the budget that the president has proposed actually says that. we're going to repeal and replace it. and you added, which is very important to me, it's not just saying this failed. i wasn't here when when it happened but it failed and we're going to recognize that. it's really about moving forward in a way that does sort of universalize the -- what you have been talking about some this morning. we should be paying our health care providers differently, that would make sure that all providers in this under medicare meet quality standards that are accountable for that, that are

transparent that help them do that. we're doing that. but we improve the health status of our seniors in particular. think of it as a role for younger people as well but we actually pay them in a way that encourages that. encourages them to i've written legislation to do that. there's been a lot of interest the part of the health care subcommittee on ways and means to pass legislation that would allow you to do this so it wouldn't just be interesting demonstration projects in the states but exull -- actually changing the way we reimburse physicians in this country. i appreciate the language you put in and i would ask you how to speak to how to get there. i know mr. brady's been very

heap -- helpful on this but to just see if we could get this done this year, rather than saying we're not going to implement the sgr this year. d to rm not hold them back from embracing some of these new ways of delivering health care that meets the needs of seniors in this country. you want to help us out on that? your leadership could be very helpful. >> congresswoman, i know you've had a lot of interest in this for a long timend a -- and i appreciate your leadership in this area. congress i'm sure appreciates that the lingering incertainty of the s.g.r. cliff is probably the sickle biggest issue threatening the health care of our seniors. there is way too much time

spent every year with doctors coming to capitol hill trying to get a fix that then takes them down the road for the next 10 or 11 months and then they start all over again. so, starting, having a long-term strategy, we're eager to work on it. what we've proposed in our budget, and it assumes that the s.g.r. is fixed but we'd like to propose a couple of years of quo, if you will, done by congress a year at a time and then working carefully with this committee and others who have a great deal of interest in this and certainly the provider community on formulating a value-based pay ment system that would be our future look at how we pay medicare providers, very much recognizing that payments should be tied to outcomes. it should be died to care delivery, to protocol.

i think there are ways to do that. we're beginning to see medical home models and a variety of strategies. the other thing that's going to be in place which is a key part of this is the broad implementation of electronic health records by for the first time will actually capture and measure what is actually happening in the marketplace. so we would love to work with you on this. >> and this is really very b pitcher. partisan. >> it is. and we have released a memorandum and outline and phase one and phase two with our friends on the energy and commerce committee and are working as well on a bi partisan way on this issue the dr. price is recognized the >> thank you. we are talking about the budget here. your comments in opening remarks talked about this budget strengthening the economy, providing middle class job growth and a, quote,

thriving middle class, quote quote and i just thought i'd share are you -- with you a couple be examples from the real world. car dealer in my town, 168 employees. because of the a.c.a., because those a.c.a., 166 of employees will be moved from full time to part time, 28 hours a week. a fellow visited my office this week here in washington, has a number of burger king outletz. over 900 employees. moving all but five of them to part-time. because of the a.c.a. madame secretary, that's not going to lead to a thriving middle class. not going to lead to job creation. this bill is harmful to the economy, harmful to job creation, and as a physician, you and i have had conversations and i can tell you that i believe it is fundamentally harmful to the quality of care and access to

care that's provided by the doctors out there who are trying as hard as they can to take care of their patients. to that point, this budget has $374 billion in new reductions in medicare spending the $307 the on of that ourvetd provider high, the doctor payment. that's not a positive move. the guys and gals my age out there practiced in medicine are looking for the exit door. what's their strategy to be able to survive in spite of the the guys and gals my age out there practiced in medicine are looking for the exit door. what's their strategy to be able to survive in spite of the law being put in place? v.h.r. is a classic example. rural docs out there in small community trying to care for patients and this imposition by the federal government makes it such that they're going to have to close their doors because they can't put in place the requirements for the a.a. --

a.h.r.. there is a piece of legislation ms. black that would take care of that and i urge you to take a look at it. and the other is closing the ans i willary exception. as you know, often services provided in a physician's office are more efficient, more cost effective, have higher quality of care than in any her setting, yet this budget closes the in-office care option for radiation services, other services, something that medpac themselves said ought to be equalized so you don't incentivize one place or the other. is there any racingale for why the in-office ans -- ans i willary exception is being closed? maybe you can get back to me on

that. >> i just wanted to verify, doctor, what i thought was the case, and what we're looking atd it the utilizeation factor that often on the same day -- seeing an increase billing, but i would like to get back to you in writing with some of the rationale behind what you have just identified. >> please do. same-day utilizeation of services is oftentimes the most convenient for patients. >> that's true. >> it may not be for government but for patients. >> we're not trying to diminish the number of -- well, just trying to diminish the number of billings that 0 caur weigh patient is actually accessing a physician. >> heaven forbid that the patient should be cared for in the physician's office. i understand that. let me move to medicare part b. quality of care for cancer

patients in this country is being harmed bauds -- because of an -- a decrease in access to care because of a decrease in 35eu789 for cancer drugs in the office setting. your budget proposes a further cut in cancer drugs through medicare part b drug services. is there any rationale for that in >> actually i think, congressman, what you're rougher -- referring to is what happened with the second quester cuts -- a.s.p. -- your budget is 3%, a lower amount. >> but actually the cuts in the budget that we have put forward would not interest erfere with the administrative service of the cancer drugs. those are held harmless the we're taking an additional cut actually from the druggeds themselves. what we learned during the drug shortage is that it is not the pricing of the medicare pricing that's impacted the shortage at

all. what happened in the sequester with that blunt cut of 2% across the board is that the entire cut actually came out of the physician' side of that puzzle and it did not affect e cost of the drug, it affected the administration of the drug. that's why some of the cancer strds -- centers told us they were choosing not to admit medicare patients any longer. >> correct. and that's inkressed -- increased in this budget the thank you. >> mr. reed is recognized. >> thank you, madame secretary for being here today. i'd like to take some of my time to focus on a very -- me, issue to ne and that's the solvency of medicare itself. in particular the part a trust fund. you are a public trustee obviously for medicare, and the report in 2012 indicates that part a will be bankrupt in 2024. do you agree with that report? is that still when the trust

fund will go underwater? >> well, i think with this budget we've added four or five years again to the life of the trust fund. as you know, the a.c.a. i think added eight years to the life of the trust fund, so repealing the a.c.a. would actually accelerate that timetable significantly. >> with this budget under your opinion is that you move it five years. that essentially means who is -- >> four years. i'm sorry. yeah. >> four years. so that means everyone who is 51 years of age today and younger are being promised by the president's budget and your office that medicare part a will be bankrupt in is that correct? >> well, sir, as you know, first of all, it isn't bankrupt. it's that it would bring in less than is anticipated going out. we have two opportunities -- >> no, no, no. that didn't -- >> 25% short --

>> it brings in less. >> so we're using the same term, what would you describe it as? >> well, bankrupt to me means out of money. >> what term would you use? i've had this discussion with people on the other side of the aisle. they say bankrupt is not the right term. insolvent? underfunded? >> well, it's fund under -- underfunded i would say. i think we have great opportunities between now and then to change those projections dradge -- dramatically. >> between now and then. but as of today the best we can do -- >> the vote taken by the majority of this committee would move that insolvency date much closer to where we are right now. it would actually accelerate the date because eight years of the trust fund were added with the passage ever the affordable

care act 79 we would love to continue to work on strategies with this committee, keeping medicare benefits in place and making sure that we can accommodate them into the future. >> to the plan i'm hearing from the administration is we're going to take each year small steps to fix -- push it out two or three years and not fix the problem in perpetuity? see, i'm interested in solve, fixing the problem. want people to look at that 12 -- 2024 date and have people who are 50 saying it's underfunded? i'll use the term bankrupt, or underfunded. that's a real problem. i want top find out what the plan is and all i'm hearing is we're going to take it each year by year and move that

three or four years. what is the long-term flan >> we would love it work with congress on a long-term plan with the contingency that the long-term plan is not to destroy medicare as we know it. that's what's been put on the table, that in the future seniors would not count on a garn -- guaranteed set of benefits. they would have a voucher and negotiate with their care -- >> i'm familiar with how -- >> rm and beneficiaries -- >> i'm familiar how you categorize and classify the house republican budget and the proposals on that. but the bottom line is that the system is going bankrupt. it's underfunded and we need to solve it and all i hear from you today, is we can't change the program. medicare as we know it cannot be changed. >> in the last four years -- >> if you would wait for the question i have for you, madame secretary. do you think we can balance or

make medicare solvent in perpetuity by leaving the system in the exact same way that it is today? >> i don't think the president or our administration supports leaving the system exactly as it is. and i would suggest in the last four, years, sir, that with the legislation passed and with the budget that's before you, more significant changes are being put forward than have been put forward in decades. we would love it continue to work on how to preserve medicare well into the future, keeping the promises that we made in 1965. >> all right. thank you. thank you. >> now we'll go back to the beginning. i just want to know for the record that our budget does have a guaranteed benefit in it. last week wall street journal columnist peggy noonan dedicated her column to the

vixary leader who created modern singapore. n describing the book, her words, she said he is bullish about america's immediate prospect but concerned about the long-term prospect and greatly concerned about the prevailing culture. and to crote -- quote him, a major problem is the day to day violence that people are sosa -- exposed to on television. i'm concerned, madame secretary, what you think is the linkage in our culture between violence and our kids, and young adults, particularly troubled young adults. are you concerned about the pervasive violence in our culture and entertainment industry? >> well, mr. chairman, i am concerned certainly about the of violence ture

both throughout media, in the entertainment industry, movies, on tv, video games, but also on our street corners. the number of children who live in extraordinary violence day in and day out -- they don't have to turn on the tv. they have to walk outside. i think we have a culture of violence in this country that is alarming. it clearly has different impact on differ people, but there's no question that i think it does have at minimum a sensitization for a lot of developing minds about what the impact of violence is and certainly for someone who is disturbed, may have even a more frightening impact. >> does it concern you, then, that the federal government provides subsidies to some of these industries, often through the tax code? and should the federal government be in the business of subsidizing something such

as this that may contribute to the breakdown of mental health in this country or contribute to this culture that people find outside, as -- if you will, and the desensitization that occurs on the street as well as in the minds of those who are troubled? >> again, i think, mr. chairman, that's an appropriate conversation for those of you who are looking at the tax code to of violence have. are lots that there of influences throughout our culture that impact folks and what the appropriate balance is between industries that we want to encourage and censorship and what they do i think is always open for debate. but i do share your concern that there is a pervasive culture of violence both through the media and the answer -- entertainment industry, but also -- also i think, america is a violent country and that's acted out in

neighborhoods and on street corners on a regular basis and that has an impact on our health, on our mental health, our communities, on our kids. >> all right. thank you. mr. levin is recognized. >> mr. chairman, in a way i'm kind of glad you shifted the reid's from mr. approach to violence. i share your hope on that hand -- and hope the senate will act on gun violence in the next weeks and bring it up to the house and we can look at the tax code, too. i'm sorry that -- mr. reed is still here and i just want to say something if i might because i think we have a look, health care reform isn't going to be

repealed. everybody should accept that as a given. and for those who wanted it case has think the become more difficult because of the diminution in health care cost increases. they've been going down now for three years, madame secretary? >> yes, sir. >> and there's some evidence that in part it's because of health care reform. case has >> will the gentleman yield? >> let me just finish. >> ok. >> also there have been some clear benefits, and you mentioned, madame secretary, some of them. the millions of younger people now insured. as an example. who now ons of seniors are paying less for

prescription medicines. i think with that situation t's hard to -- for those who opposed health care reform to be sure what to do. nd i just urge that there be , to tance to overstating doom and gloom, and i think often to kind of scaring people. that's why i think the ecretary resisted your characterization of medicare going bankrupt. on this committee we have faced underfunding of medicare many, many times. you were in control for a number of years. perpetual asn't this

long-term resolution of the problem. but again, many times we've faced underfunding and sometimes as a result we have educed provider reem burstment -- reimbursement. what health care reform really does in good measure is to begin the path of changing from fee-for-service to a very different reimbursement system. some ile there is agreement across party lines on this, in terms of scare tactics sometimes they've described ipad -- ipab as a death panel when it's really not that at all. let me just quickly ask the

secretary, and then if there's time i'd be glad to yield. i think another kind of doom and gloom approach of those who never wanted the health care reform that's not going to be repealed is to talk about premium increases. so just address quickly, if you would, your feeling about what's going on. >> well, congressman, the insurance plans are in the process of beginning to submit preliminary estimates on rates in the new marketplaces. by e will be negotiated either the state-based markets or the federal market and by later this summer we will have clearer picture the again, what we know from the congressional budget office is that the estimate is that rates

will be significantly more competitive than people find them right now. there will be an elimination of a lot of the overhead and administrative costs. there will be competition as a market strategy. i've seen this as an insurance commissioner, it does work, that when plans have to compete de by side and it's very transparent, that in and of itself drives prices down. so we are anticipating having people, if you compare policies to policies, what they have now and what they're going to have, a very beneficial set of rates and benefits that people will have an opportunity to choose from. some of them for the first time ever in their lives because they've been priced out of the market. >> thank you, madame. i appreciate that. all time has expired. i appreciate mr. reed's concern about the need to save medicare. the clock is ticking. we need to act now, republicans and democrats. i don't see that as frightening. i see that as a genuine concern for a program that's in very

evere financial straits. to try to bury our heads in the sand is really the wrong thing for our seniors. i think the only scare we heard -- witness' es claim that the republicans want to end medicare as we know it in didn't that winned award for the national political untruth two years ago? maybe we'd be better off if we actually came to the table together and figured -- witness claim out how to save medicare rather than hrowing and to that point i'd be cautious claiming that the slower growth in health care costs from from obama care. independent experts don't say that's the case. in fact, 20 million people poin

cautious claiming that the slower growth in health care costs from from obama care. independent experts don't say that's the case. in fact, 20 million people can't find a job. many more have just given up looking for work the it's jimmy arter days for them. since the recession you are more likely to go look for food stamps to feed your kids than to find a job the it's clear that since the recession you are more if you can't find work and can't feed your kids, you're likely not going to the doctor. so i'd be cautious at a time en the stimulus claims why exagrated and the sequester, claims were exaggerated. out wh knows has been discredited? let's stick to the truth the this is the marketplace timeline for the exchanges. that's for the public as well as lawmakers to track how the exhays are on track. but as i look at it what i see is deadline after deadline missed. it says if the agency is in disarray trying to meet the october 1 deadline, the final

market rules and regulations was missed. the payment notice rule was missed. the business rules for information technology, that's two months delafmentde you recently announced a delay in the choice option for small businesses the. you've also delayed the basic health care plan for year five of it. and so these delays are having real impacts. real people are concerned about hese delays, and the failure by the agency to meet these deadlines raises real concerns. so my question is, do you have a plan b? do you have contingency if the exchanges are not ready, up and running with a fully physical -- fully informed public, by october 1? >> as i answered before, congressman, we will be open for open enrollment october 1 of 2013 and we will be enrolling americans across the country january 1, 2014.

>> so at this point you've had no discussions within the agency on contingency plans? >> well, we have lots of contingency plans -- >> for meeting the october 1? >> no. we are determined and on track o meet the october 1 deadlines. >> so you can assure this committee there will be no further deadlines missed, no further delays in the implementation of the exchanges? >> we are on track to meet the october 1 deadline. >> the question again, because i think we're all concerned, republicans or democrats, you can assure us there will be no -- >> congressman, i can only tell you what i am telling you. we are on track to meet october 1. i can't tell you what exactly will happen at every step along the way but i can tell you that is the determination. we are on track to meet it. we test it -- >> well, you're not on track to meet it. that was the question. ? pardon? >> you're not on track -- >> we are on track to meet the october 1 deadline. >> so again, there will be no

further deadlines missed? no further delays? >> i -- again, i don't know quite what that means. will a rule or reg be a week later than it might say on the paper? it could. we will be open for business october 1. >> so no delays. that's great news. no further deadlines policed. that's great news. we're still waiting at small businesses on the business information notice that's two months late. is that being delayed again this week? next week? are we seeing another ongoing delay there? >> i think, sir, that is not ours, it's the labor department's notice. but my understanding is it's imminent. that is not an h.h.s. rule that's coming out. >> ok. thank you very much, madame secretary. mr. rangel is recognized. >> thank you. thank you so much, and again thank you for your service.

i'm concerned about the american people that are now doubtful as to whether or not they would have health insurance and also the fact hat i don't know whether history will record such political opposition to any president with a national plan. all of my political life i had hoped and dreamed that we would have universal coverage, and now we have had -- it and for some reason it's become a political issue. 40 attempts, or 39 attempts have been made by the republican party just to repeal it. not to substitute it, not to improve it, but to repeal it. and of course they substitute that with just confusion that it's not going to work, it's going to fail, as though there were only democrats or potential democrats that were

going to be the beneficiary of the program. to have to find some way bring truth to the american people no matter what their political persuasion is and i hope that you can do this by elling me exactly how many americans would be affected since we've got to assume that e've the supreme court has sustained this and the first question is obama came here to say politically speaking, is there anything you can think of besides withdrawing the president, having to recall with the president, or another case in the supreme court. obamacare is here. you suggest that the best we can do is to improve it, if bedon't like it, instead of just

opposing your efforts. my question is how many americans are going to be affected anyway? those who have insurance are not going to be impacted, right? >> i would say in terms of the new marketplace, a fairly small number of americans will be impacted, about 41 million eligible folks who don't have insurance at all and another 14 or 15 who are in the small individual market. >> do you know the political persuasion of these 41 million people who have no insurance at all? >> do i know, no. democrats.ans or >> they are americans. >> right. what could the congress do to make certain we provide -- to help you provide universal

coverage at the least cost and the best quality? what would you expect this branch of government to help the executive branch to do this for all americans? >> i certainly think a huge step forward was the passage of a comprehensive health reform, which has been proposed by republican and democratic presidents for over 70 years. we finally have a framework to work on. you asked how many people were impacted and i gave you the answer for the marketplace, the new insurance fees. i think every american will be impacted and benefitted by the delivery system change, better care, better population health, more effective ways to deliver and making sure we no nger continue to be the --

spend the most with immediate occur quality. thanks to the innovation center, that could change the profile in make us more competitive a global society. >> since you're unable to give us assurances that these programs are going to be open on say that safe to you're assurances to say we are on track depends on some cooperation from the congress? is it possible that we can legislate something to avoid you following the guidelines that you have been planning? >> again, sir, i don't know how much more specific i can be. i think we're definitely on as to immplement the law

it is anticipated. >> that's the assumption you're going to have positive support from the united states congress to do this? >> it would be helpful. >> thank you. for the final question of the morning. >> welcome. it's great to have a buckeye ers here two michigan with the chairman. i would like to send you an article from last week or the week before to his point of a small business owner who has less than 50 employees that was planning to grow his business beyond 50 employees. he said in the article he's not doing that because of the affordable care act. it is a problem i've heard about employers and this

one was willing to say it to say it to a reporter and explain why. i'm not trying to be political about this. but mr. chairman just asked about the political persuasion of people without insurance today. i was on this committee when we passed this bill and i like you a lot. there's a lot of concern from everyday people out in my district regarding the implementation of this bill. the president over and over said, if you like what you have you can keep it. et me tell you a story from my district. from it is from a company that i ago, th a couple of weeks self-insured employer. the h.r. person was looking at this and trying to immplement this law with their employees.

they have a great plan. their employees love their plan. their employees think they can keep their plan. through their ability to look at this implementation, they found out that their plan with no added benefits will increase by 10% at least. the $60 fee that they are going to be paying alone will cost over $1 million with absolutely no, no change in their policy because they already participate in what is called the -- just so i'm clear on this, the plan that covers people with pre-existing conditions and in order to take care of their employees through the early retiree subsidy program. they don't get a penni from that. so they -- penny from that. they are trying to figure out

what to do next. what is clear is they are going to have to increase cost if they keep what they have to those employees. those employees don't know that yet. i'm not trying to be difficult here. i'm trying to explain the concern that members on our side of the aisle. i'm not going to defend the old system. they are super concerns about the new system. what may happen -- again i'm not trying to be difficult, they may choose to put all of their employees into the exchange. so their employees may not be able to keep what they like, which was a promise of this committee, when the majority was in the minority's hands. their employees don't know that yet. the satisfaction surveys that they have received from their employees from the plan they have are overwhelmlingly good. this is a company who have prided themselves on heche

coverage, deal wling obesity, dealing with cancer, dealing with pre-existing conditions. he choices from nonpolitical h.r. people there -- i could see it in their eyes how troubled they were with where they were going to have to go and asked me is there any sort of opportunity to change this for folks like us? i said i don't think so. you might want to contact mr. brown. he might have more luck doing it. i'm not trying to be politically. i think ultimately, these are my constituents and they are democrats, republicans, and independents, nonpoliticals. their health care is going to change, according to their experts, for the worse. i know your history and i know you care about this.

maybe you and your team can be more engaged with some of these employers who are very, very nervous about the future of the benefit they have provided. they were not ones we're trying to get at in terms of access to health care, if that makes any sense. >> it does. and trust me we are trying to be very engaged. i meet with employers in varies -- various parts of the country as i travel around. i think as we move into full implementation, i'm hopeful some of the projected fears will be relaxed a bit. it's very difficult until -- the case you're talking about, congressman, is a self-insured plan. so they are looking at some certainty in terms of what fees there may be in the market versus the penalty they would

pay if their employees are then tax eligibility and they can do some calculations. i'm hoping in the long run that compleers who have been in the market voluntarily because they find a benefit to their employees will move forward with that benefit. that's what we hear from folks and the people who are locked out of the market because they did not have any affordable options, they did not have an ability to provide those benefits will finally have some choices based on private plans in their states who have to compete for the first time with a new set of rules. but i will continue to do the outreach and we would love to have a chance to talk to some of these folks about what they are looking at. >> thank you very much. that concludes today's hearing. i want to thank you for your time this morning and your testimony. th that, this hearing is

adjourned. > thank you. [captioning performed by the national captioning institute] [captions copyright national cable satellite corp. 2013] >> next americans for tax reform holder countdown to tax day news conference. after that a look at the congressional agenda with eric cantor. then another chance to see health and human services leader testify on the president's 2014 udget request. on the next "washington journal" armstrong williams discusses the republican party to reach out to

minorties. after that, dr. quinn. e looks at attention deficit hyperactivity disorder known as adhd and why so many children are being diagnosed. "washington journal" is live on c-span at 7:00. >> i learned this week how humanizing politics is. it is about people who interact and we learn that we can do this. we're all cape ability of being leaders of our country and it is about working together and finding common ground. >> before this program, i was not that optimistic about the future. like jay said,all the media shows is the negative aspect about the future. i think this program made us all more optimistic about the future and more positive about where the country is going. >> we get the negative opinion

from all the news media but the fact of the matter is they are working together. the justices can go hunting together. >> i feel like president obama summed this up perfectly yesterday. he said our country has always been in turmoil throughout history but we as people found a way to get through it. and i'm not saying i'm not worrying about the future and we don't have problems we need to fix. ut i look around this room and i see minds who want to make a difference for the country, who want to do good. i'm sure there's plenty of people around our age that want to make a difference and want to do good. i believe we can solve the problems we face today. >> each year high school students from across the country meet in washington as part of the senate youth program. this year think met with all

three branches, including president obama. hear that insights from the week. that is sunday night at 8:00 on cr pan's "q&a." >> americans for tax reform grover norquist calls president reduce moneyegy to is bad way to raise money. he is joined by the house and means committee. this is just under an hour. >> thank you everyone for coming today. this is our annual americans tax reform tax day eve press conference. before turning it over to grover, i want to briefly go through the handouts that you have on your seats for our c-span audience eerns that might be watching this that are not live here today. you can find these handouts on our website.

we have a handout on 100 years on the income tax. this is the 100th anniversary of the income tax. we have a chart of what it looks like when it was started 100 years ago and what it looks like today. president obama released his budget this week. it is a $1 trillion net tax increase over the next 10 years. we broke out the worst tax increases in there. we have a break down of tax increase that are in this obama budget. we have the top five worst obamacare taxes that are coming online this year in 2013. people have not seen this in the tax filing so far, you will see it next spring. you will are already paying it whether you know it or not. we have the full list of all the obamacare tax increases, there are 20 new or higher tax increases in obamacare.

finally, we have a map of the who controls what, in terms of state legislatures and governors and all that. so unified republican control, unified democrat control or a split. with that, i will turn it over to grover norquist. you can find these handouts on our website. >> thank you, ryan. you can't change the world without handouts. i want to make sure everyone has that great information here in the room or online. this is the 100th tax day press conference. some of us weren't here at the first one, but in 1913 some idiot thought this would be a great idea. they went to a low of one up to seven. the lowest rate is 10%. to get into the 7% bracket when they first thought 7-this

income tax you had to make in today's dollars, $11 million puts you at 7%. be y for a lot less you can pay -- be rich and pay a lot less. today is the 100th anniversary and it is a particularly interesting press conference because we have the perfect wave of taxes. we have this year we start $1 trillion -- i'm sorry, i forget to put the t's in. we have $1 trillion to pay for the affordable care act that starts this decade. another $600 billion from the fiscal cliff. the democrats in the senate have a budget with $1.5 trillion increase in the next decade and president obama has one at $1 trillion. not only are we being hit over

the next 10 years starting now we're also threatened with new ones. we're going to hear from a number of congressional leaders in taking the lead in trying to stop these tax increases and begin the process of moving us back. we have now with us the house majority leader eric cantor. >> good morning. we are now three days officially before tax day in the united states. i think this brings us to the millions of kitchen tables around the country where families are sitting down finally, having to sign their returns. many have to write a check and having spent too much time in preparation and entirely too much money and resources being spent, i think brings home the point that yes, finally, now is a time for tax reform.

several members of the ways and means committee are here that believe strongly that we have an opportunity this year to reform the tax code, to make it simpler and fairer for our working families. as what was just said, we have this week also, the realization that the president has proposed his budget finally but yet, much has not changed. he continues to call for more tax burdens on those families sitting around those kitchen tables. we in the house, as republicans, disagree that we ought to take more out of the pockets and checking accounts of the people who earn the money. washington just imposed a steep tax hike on working families earlier this year. it is time for us now to do something for them, not just take their money and this is to reform the tax code. i commend the effort of americans for tax reform and

look forward to working towards that goal. thank you. >> many people around the country are trying to hurry to get their tax returns in by april 5. i would point out that the president ran over time -- legal time by two months to put his budget in, the democrats in the senate ran over four years in presenting their budget. so if you can't get to it by april 15 include it in there tell them you will get it in two months or four years from now and we'll call it even. if i can call congressman kevin brady from texas up to the podium. >> thank you very much. america's tax code is broken. now is the time to fix it. this tax code is unfair to families. it's riddled with loopholes, it complicated, enit is a drag on america's economy. so we're committed on the ways and means committee and the

house of republicans to fix the broken tax code this year. our challenge is to create a pro-grote tax code that jump-starts the economy and encourages families to work smarter and harder and gain from their hard work to release the power of our small businesses. and we can have the ability for america to finally compete in the global marketplace. fixing this tax code is about growth and opportunities. my challenge to the president is this, you say you want to close loopholes so you can spend more money. we say we should close loopholes so we can lore tax rates for families and businesses. so come to the table. we may disagree. come to the table now and stay with the table with us in the house until we can fix the broken tax code and let's commit to do it right now.

thank you. >> thank you. we had some breaking news last night and this morning. digital ask "the liberty" to talk about the i.r.s. and your e-mails as you pay your taxes over the next several days and send out e-mails. >> so i want to bring your attention to a disturbing revelation of the practices of the i.r.s. they are looking at your income but they might be reading your e-mail. the a.c.l.u. discovered that if you're a target of the i.r.s. investigation their policy is to check your e-mails without knowledge. the i.r.s. crames that agents do not need a warrant to read your text messages and e-mails eastern documents because they are stored with a third party

ervice provider. the electric privacy act of 1986, government officials need a subpoena to read e-mails that have been opened or more than 180 days old. the only e-mail i have under 180 days old is spam. that is a warrant requirement for your spam but not your personal e-mail that you stored for a couple of years. the time restraints are not the reason that the i.r.s. thinks it can read your e-mail. the aclu found that the i.r.s. believes that the fourth amendment does not apply to e-mail because internet users do not have a reasonable expectation of privacy in such communications. a letter to the

i.r.s. -- in their response they may have said they don't target people's e-mails or social network information but that doesn't mean they are not reading your e-mail. it does not solve the philosophical problem that the i.r.s. doesn't believe the americans do not have the fourth mendment right online. digital fourth coalition is a partnership with aclu, americas for tax reform and heritage action for america. we're fighting to get the fourth amendment rights recognized by all government ajepts. >> thank you. we're joined by the congressman from california with the ways and means committee. >> thank you, grover. thank you for continuing to fight this bat. today we're going to bring in $2.7 trillion, which is more money, more revenue that this

government has ever brought in, my guess it might be higher than that. that this is under the old tax scream. when you listen to all the government calculators, the c.b.o., they are all fine and good people. they are going to say their revenue will continue to grow. when we stand here a year from nowings, we're going the have less revenue. why? because a lot of people got worried about the tax system is going to look like and they paid a lot of taxes earlier. it does not matter at this point how much revenue we raise or how many taxes we raise, i don't think without economic growth we can ever get to the $3.5 trillion revenue to get this budget into balance. we should all be concerned about that as americans. as we look forward on tax reform, quore going to have to

have brord, comprehensive tax reform if we want to raise enough money to fully fund the government. that does not mean higher taxes. that is going to mean lower taxes. so, grover, thanks for all the great work you're doing. >> thank you. as we look at this i mention that income tax started as a tax only on the very rich and became a tax on almost every american. this is what politicians call trickle down taxation. they target 155 people then hit four million, perhaps threaten 30 million. they did the same thing with the funding of the spanish-american war. only the truly rich were then very soon, every american was paying for the tax long after the war ceased to continue. we now have a president that promised he would not tax anyone who earned less than $250,000

and that lasted 16 days into his first term when he raised taxes on people who smoke cigarettes. so his promise only to tax rich people lasted 16 days in the administration and now he's repeating that with another tax increase on lower income americans with another tax increase targeted at middle-income americans. congressman. by >> so if you're working on a production line in illinois, which i just visited earlier this week. you understand or you come to understand the impact on taxes, on your ability to improve in your marketplace, to improve the wages that you're gaining and improve opportunities all around you. it's been stated already today, we have one of the least competitive tax jurs dictions in the -- jurisdiction in the whole

world. by doing nothing over the past 30 years we've fallen behind. we need to look at the marketplace in the united states and avoid those jurisdictions that has failed. i come from a state that has failed. the state of illinois fell into the trap in a big fiscal drama of raising taxes and proposing that was going to be the remedy. here's what happened. the taxes went up, the underlining spending problems were not dealt with, now they than ier hand -- hirer average unemployment rate, unpaid bills after the new revenues came in, a credit rating that has been downgraded and on and on. that is in stark contrast to other states around illinois that has hat more thoughtful tax policies, a higher view of taxpayers and they are in a better fiscal situation.

we don't have to look at tax theory to find out what works, lower tax rates and a simpler x code is a remedy for prosperity. >> thank you. illinois, california, maryland, massachusetts, and new york are an example of whatnot to do. some states serve by examples, some states do the same. politicians can reform government or raise taxes in order to not reform government. a number of states, california, illinois, decided they would rather raise taxes than reform the state government. other states are deciding to reform government rather than raise taxes. we're joined by congressman brady, also with the ways and means committee. i'm sorry. he was so good i was