>> i thank the chairman and our witnesses for being here this morning. commend our chairman as this committee has conducted business over this past year for the bipartisan nature in which we have done things. this committee does not take on the same feeling. rather than a hearing but i ssure you there are no torquemundas on the other side. they are good people. it's unfortunate we couldn't be working on constructing the healthcare affordable act. without the healthcare affordable act, all of the provision that is you talked them?that people are enjoying,

they would not be available to the 3.1 billion people who receive benefits. 17.6% of children. 71 million in preventive care for the elderly would all be gone, correct? >> if it were to be repealed. >> what would insurance cost be without this act? what was the trend with respect to insurance cost? >> insurance cost were going up at a much higher rate before than they are now. >> that is, in fact, true. so now with the exchange coming on, the truth of the matter here is that what we have is not something that cms oversees like medicare. many on our side would have preferred a single payer system. what we have is different

systems but it's the seed of an idea that was put forward by the heritage foundation. an idea that was implemented by a republican governor in a democratic state. it was done very successfully because democrats and republicans worked together to put this through. now we have an opportunity to take the very best of public health, the very best of science technology and invasion and the very best of entrepreneurialism and drive them the most inefficient business in this country which is healthcare delivery. i repeat the most inefficient business. and so we have the tools and the techniques that the other side should be joining with us to use that, by the way, would drive down the national debt, would make healthcare more accessible, affordable and crete a new paradigm where

patient outcome and wellness is the goal, not so much the delivery in a hodgepodge manner. and it's because the private sector now is coordinating care under the affordable healthcare act that we see the tremendous opportunity for great gain. but instead here in congress we prs on playing taste great, less filling. yet the 40th time a bill is going to be repealed. instead of saying how can we work together, trying to play got you and what is going wrong until the agency. the american people are fed up with this. we're going to go through this sha raid one more time because it's a political point that has to be made. but what the american people want to see is affordable health care, the deficit paid off. we have the framework, the

context to do it. let's get it done. let's not go after these people who are trying as hard as they can to get an act in front of the american people to allow them to get the healthcare coverage they need. it's a good thing for the american people and we should ing on it together, not fighting. >> i yield back the balance of my time. >> thank you for being with us today. i'm concerned about the impact it's going to have on our hourly plofmentse there has been a discernable and dramatic shift from full time to part time work in recent months. schools, colleges and restaurants throughout my district in indiana have reported this to me. but this is not just anecdotele

evidence i have. you look at the trends from the labor department. roughly 100,000 fewer americans are working full time. e june jobs report indicates 32,000 -- there has been an increase by 320,000 people of americans who want to work full time but can only find part-time work. what is driving this trend? it is the affordable care act in large measure. you have employers that are chopping up their full-time positions into part-time positions so they can stay nder that 30-hour fresh hold to stay under the employer mandate. it is driving up cost on businesses estimating to our federal government of $106

billion. and there are a number of people living from paycheck to paycheck i talk to on a regular basis who are not just hurting but they are angry at those who put this law into place and those who are implementing it. and they want reforms. so i do come here in the spirit of partnership to identify those reforms. i note that president obama has already signed seven of the so-called partisan and meaningless bills which he on a regular basis despices in his speeches. he's responded to the employer community by delaying the employer mandate. i wish he would also extend mandate relief to rank and file americans and their families by also delaying the individual mandate. but i'm going to ask you a few

pointed questions here. do you think the administration could support as another possible measure repealing the definition of full time of 30 hours which it's never been popularly understood to be and restoring the traditional 40 hour definition as it applies to this act? >> i'll start by saying i'm not the right government official to answer that question. i would defer to treasury on those type of policy calls. >> that's not mine either i'm afraid. >> the tax code, of course, is your forat the so i'll ask you this. can you point to any places where full-time is defined as being 30 hours a week? >> i will look into that and get the answer for you. i don't know the answer. >> i believe i know the answer. i'm not the commissioner or the guy in charge but the answer is

no, it's never been defined at 30 hours and that's why the american people understand it to be something much higher than that. >> do you believe a one--year delay of the employer mandate as you consult with your bosses, do you believe that that is going to stop this trend of reducing the number of hours that our hourly employees are receiving from 39 hours down to 29 hours? >> i'm not sure. what we're hearing from employers is they wanted an opportunity for two things, to talk with the treasury department and i.r.s. about how these regulations are constructed and how the reporting provisions will exist. and they also wanted more time to develop and ramp up their technology and process solutions to meet the new requirement. now whether they then in turn that has other impacts on their business, i would imagine it would. i don't know what impacts it would have on their business.

but the direct request we had from them is to work with us on the requirements themselves and give them time to develop the systems needed to meet those requirements. >> we have another jobs report coming out on friday and others to follow. so we will see whether or not this one-year delay has any impact on the reduction of number of hours and thus wages of these workers who are on the margins of our economy. thank you and i yield back. >> thank you mr. chairman. i thank you for being here. it's been a long day so far. but help me out with my constituents. i represent a district where i was a businessman there for almost 28 years before coming here. you made a statement that i wrote down it said health insurance rates were going up at a much higher rate than they have since the affordable care act. but when i go back home and i

go back to those same businesses. and i remember when i operated health insurance cost were going up 7%, 8%. today 32, 63% is one of the percentages i got from the businesses i dealt with. you just said healthcare cost are going down but that is not what is happening in ohio which is expected premiums are expected to increase 88%. >> obviously i'm talking about averages across the country. i'm not talking about a specific business in ohio. >> i'm talking about a district in ohio. >> or a district in ohio. but one thing you can tell them that is real benefit to small businesses under the affordable care act once it is fully implemented in 2014, there are two things. traditionally businesses in high risk employment like construction workers, cost of

health insurance was extremely lie because the risk factor. can't do that anymore. for smaller plorse if you had one employee with high health cost you could be upgraded because of the condition of that one employee. can't do that anymore. there are benefits that will come into effect starting next year that will have a real significant impact on the cost of coverage for small business. >> you're saying hold on, it's coming even though they are experiencing all these high rates. >> not all the provisions have gone into effect but in 2014 these will. >> just so we know that's the comments you've been making in general costs are coming down. i'm afraid my district is not experiencing that. >> regarding the data, my constituents, my colleagues, i'm even somewhat concerned we're talking about sensitive taxpayer information being prepared for october 1, having

this already. you said you're going to have everything ready october 1, correct? >> with respect to the transition of tax data to the hub to the exchanges, yes. >> would you be willing to demo that before you implement it? >> i will have to consult with my staff to be sure something like that can be done but anything we can provide to give awe assurances about what we're doing, i'm committed to that. >> if it's ready to go october 1 -- you're saying it will be ready to go october 1? >> yes. and we will get you what you need to understand how the protess works and we'll work in terms of what the demo looks like but yes, i'm committed to do that. >> so sometime in september we can expect that? >> yes. i'll have my staff work with yours. >> can you tell me how much has been spent to date to implement this system?

>> i have statistics for the irus costs of the systems -- various costs of the systems. as an example in terms of the transactional portle and data passing to and from i.r.s. 3.1 million spent to date. i think it would be helpful for me to give you a detailed rackup by fiscal year and i can provide that information to you. >> i'd appreciate that. >> can you explain -- i know you've said a number of times the exchanges will be ready to go on october 1. what's the backup plan if they're not? do you have a backup plan? >> there is no if not. people will be able to go online and submit their data nd enroll in coverage.

we will be sure that the opportunity to get enrolled in coverage will be available. >> no backup plan? >> we have a lot of different procedures in place to make sure that is possible but there is no it's not going to work. it's going to work. >> you have said a number of times today too that you're verification 0% of income, 100%. i want to make sure when you say that -- and verification and i'm a c.p.a. and verify by looking that the document and that document. if you go to elk qui fax and they give you a number that's incorrect, are you going to call that verification? >> we're going to compare the information the applicant gives us and compare it and see if we

can verify that way. if we can't we'll get additional information from the applicant such as pay stubbs. > so a year from now you'll be able to testify you've verified 100%? >> your time has expired. >> i'm intrigued by the 88% premium increases because we're seeing states that are working to try and implement the legislation and doing so in thoughtful fashion are seing the opposite, reductions in new york, reductions in california. the state of washington -- mr. chairman i would like unanimous consent to enter into the record what is happening in or or in terms of -- oregon in terms of lower cost. people are actually not

comparing apples to apples. they are not comparing healthcare that no longer has preexisting conditions, no longer can cherry pick in terms of inadequate coverage that previously people had. and i find this unfortunate. but i find it entirely consistent with what has appened in this committee. when we had the prescription medicare drug program jammed through in the middle of the night after unprecedented arm twisting, some republicans claimed borderline bribery, leaving the machine open for two and a half three hours, whatever it was. and these were not our approaches and a program that wasn't paid for, unlike this, we could have sabotaged it.

we could have picked away at it. but to the best of my knowledge all of us rolled up our sleeves. that was the law. there was an opportunity to give benefit to people and we were moving to try and improve it. i heard some concern from my friend, mr. ryan, about what is going to happen with some of the people who may run for the penalty provisions. there may be -- i find that ironic because this committee majority actually took action to make the cliff worse, to mag any fy the effect of the clawback. to put more people at risk of having to pay back more money. there was one provision that would have eliminated it all together. of i find that emblem attic what is really sad that for the

first time we have a party committed to under mining a law, not fixing it, not refining it. not trying to clarify where the problems are and working together to solve it, but to throw sand in the gears. the i.r.s. is having furlough days for heaven's sakes. i don't know any business that lays off its accounts receivable, undercutting the information, having interm nibble hearings, dragging thoughtful men and women who would like to be out doing their job implementing the law on pointless exercises to repeal a law that is not going to be repealed and thus making it hard tore have a smooth implementation, harder to give people the information, harder to work out the glitches. nobody would have designed the

bill the way it is. it's a b-. but because of a complete collapse of the legislative process in the senate, we had to do it through reconciliation and ever since there has been this assault on its implementation. that is sad and unfortunate. it shortchanges men and women around the country who would like to take advantage of the provisions. and as i will illustrate from the information i'm submitting to the record from oregon there are some real advantages here. it's going to be fascinating watching in a year states that have rejected money for medicare, states that have rejected setting up their own exchanges and trying to work compared to states that is going to be a positive benefit. i hope this is the last time we see a concerted effort to sabotage a government program

and benefits for our citizens as opposed to refining, fixing, debating and moving forward. mr. chairman, i appreciate your having the hearing. i would appreciate if you could provide in writing the answer to mr. ryan where the hypothetical that he came up with the young woman would be eligible to apply if she's not a dependent. if they could be part of the record i would deeply appreciate it. >> without objection that will be allowed. and i do want to note to the gentleman this is the first oversight hearing on implementation of the healthcare law that the committee has had, first and only so far. with that we'll go to mr. griffin and then mr. shock. >> thank you for being here. i appreciate it. i take this hearing seriously and everybody up here

represents about 700,000 people. and the people i represent don't agree necessarily by the same margins with some of the other folk that is is it up here. i represent a district where people oppose in large part this law. and that's just a fact. so when i speak it's not tim griffin you giving you my opinion only, i'm speaking for americans who have grave concern. so this is important to have this discussion. ive heard today talk about passing bills that have zero chance of becoming law, don't want to improve the law. well, last time i checked, seven of those we've passed have become law. i'm holding the list right here. so if you doubt that we want to improve it as well as get rid of it, these are not inconsistent. you have a long-term goal and a short-term goal. we've passed numerous bills here that the president has

signed into law, at least seven. and the biggest change, the gutting at least for one year of the employer mandate. that's what my bill was introduced to do. the worst the white house could say about it was it was redundant. i wanted to comply with the law. i thought it better if congress spoke on that issue. so i take issue with the idea that somehow these bills can't become law. i think there are a lot of laws that people on both sides of the aisle oppose and they will work their time in congress to repeal them. this is one of them that i'm focused on. but i want to mention a number of things here. sometimes i feel like the discussion is not rooted in the reality that i hear. so i'm going to get away from my opinions, get away from the opinion writers and i just want

to read some of these headlines from news stories so that we can all agree that this is out there around the country. i think this is important so i'm just going to read some of these. the a.p., florida insurance officials say rates will rise under the a.c.a. georgia insurance rates spike under obama care. chattanooga business owner says obama care costing workers pay raises and benefits. consumers could see 25% premium increases under obama care. half of affordable care act call center jobs will be part time. obama care to impact franklin workers. white castle on obama care, we may only hire part-time workers. well point sees small employers

dropping health coverage. growing worries forces out of state markets. full-time versus part-time workers obama. obama forces work hour limits for students. obama care delays relief for family business. texas business owner facing a million dollars in obama care costs. and i have pages and pages and pages and i'll be reading these on the floor of the house tonight. but the point is these aren't manufactured concerns, these aren't opinions. these are real news articles. so in a serious way, i'm trying to convey that a lot of our objections and concern reflect the concerns of our constituents. i hear it every day. i got a text on the way -- i

was over doing a one minute and i got a text from a constituent who has my cell phone number, most do, telling me her objections to obama care and the affordable care act. so this is real and it's real for our constituents. and i just want to make sure that you hear that side of it. it's not all washington speak. we're communicating what our constituents are telling us and they are scared and they are concerned. thank y'all for coming up. appreciate your time. >> mr. shock. >> thank you mr. chairman. thank you gentleman for your patience and cooperation with our questions. let me start at the 30,000 foot level. your responsibility is to carry out and implement the affordable care act and obviously this is a law that was hotly debated, passed the senate and the house and signed into law by the president, is the law of the land, your responsibility as a federal employee is to carry out and

implement that law. the president has decided -- the administration i should say, the president volume liesed his decision to with hold a portion of that law, specifically the employer mandate. i'm just wondering from your perspective as that federal employee, did you seek any legal counsel or legal opinion on whether or not you could go ahead and not implement a portion of the law passed by congress and instead move forward on a dictate from the president inconsistent with u.s. law? >> i haven't but i would point out that portion of the law is not one of the one that is i am tasked with implementing. that portion of the law is the treasury department and i.r.s.', not mine. >> i wasn't in these meetings but there was a team of lawyers as i understand it who evaluated the legal issue surrounding this decision on the employer provisions. so i think there was

significant legal review of the issue. >> can you get to us the names specifically of who gave that legal opinion, whether it was treasury department attorneys or whether it was legal staff at the white house, who specifically weighed in on the legal interpretation to determine the executive branch could unilaterally make a decision of not up holding a u.s. law passed by congress and signed into law by the president? >> i would get you the answer to that. >> i think it's confusing to americans to watch us debate laws, watch them be enacted and see the president for maybe legitimate reasons say this isn't ready for implementation and rather than go back to congress and say we need y or z n to not do x, the executive branch says we're just not going to do it.

it undermines the credibility as we work on other challenges and issues facing our country whether it be immigration or the debt, that trust is so important between the executive and legislative branch, as well as with american people. >> you mentioned in your -- ents early yerl that earlier that in reference to the employees that wish to oment out of the exchanges that you thought it was appropriate that those employees be able to stay with their current policy because they are happy with their policy. i'm wondering whether or not given the fact there have been several thousand exemptions given out to different businesses and labor groups not to have to comply with the law, whether or not the treasury union employees would be able to apply for a similar exemption?

>> if i understand the issue correctly, the federal employees and i.r.s. employees would not need to do that. the statement was in response to a proposed piece of legislation that would have required federal employees to move into the exchange framework. and so they were saying we prefer not for that legislation not to pass because, again, we already have affordable healthcare coverage and are happy with our current program. there is no need for a waiver of the i.r.s. employees as far as i understand the law today. >> so how would they be exempted? >> the reality is you only go to the exchange -- it's an option. you have to have health insurance under the law. but as a federal employee you have health insurance so you're covered. you wouldn't go to the exchange unless you're unhappy. >> but the law requires them to go to the exchange. >> no, it does not.

>> why -- >> the proposed bill being introduced would have had the requirement in place. it would have basically taken away the normal federal employee health benefit plan and required them to move to a different health benefit plan through the exchanges. and they were saying i don't want that law to be passed -- >> they don't want what is happening to congress happen to them? [laughter]at's correct. wax that is correct. >> it sounds as though you have a plan to speed up income. i want to quickly throw out figures. 20,000nois they found .edicaid cases

13,000 of them should not have gone on to medicaid. people assessed, yes, i qualify. two thirds of them were thrown off. wehink that is a problem if were going to say yes now and verify later. yield act. >> time is expired. for want to thank you answering the questions put to you, and this hearing is adjourned.

[captions copyright national cable satellite corp. 2013] [captioning performed by national captioning institute] >> live coverage begins at 9 a.m. eastern on c-span 2. coming up shortly, more about the implementation of the health care law. we will hear from the medicaid administrator. the white house said it was disappointed in russia's decision to give asylum to edward snowden. we will also get reaction from john boehner. >> this weekend, live coverage of the national governors

association summer meeting in milwaukee wisconsin. this year they discuss infrastructure and the global economy. your questions for the head of pediatric neurosurgery at johns hopkins. then the assassination of martin luther king junior. forhe head of the center medicaid services was asked about provisions in the law that required workers to be provided health care coverage. the committee will come to order. the chair recognizes an opening statement.

as we prepare to return from our districts, there is one topic of conversation that will be sure to arise whether i am in williamson, montgomery, r henderson county, all areas familiar. i would say they are into camps. sure whatare quite obama -- who are not quite sure what obama care will mean to them and those who are opposed to what it will do. it is the uncertainty of the law that most concerns me, uncertainty about how much individual health insurance costs are going to go up, and certainty -- uncertainty about what new employers must take on as a result of the law and business uncertainty for the devices medical

companies. it appears you have a lot of work to be done by the end of the year, so much that secretary tightus acknowledged deadlines. i voted yes on the act to delay the individual mandate for one year, i mandate supported by just 12% of americans, despite being told over and over by the president that if you like what you have you can keep it and that health-care premiums would go down on average 25 hundred dollars. individuals are seeing the opposite. those int found for the individual market in tennessee, premium increases could be expected as well as smallses of 35% in a

group market. unfortunately, these increases should surprise no one. if something is taxed and there is 165 the lien dollars in taxes and fees and then loaded down which it iss, absolutely going to be more expensive. according to a recent gallup poll more than 40% of small- business owners of frozen hiring. employers surveyed say obama care would be good for their business as opposed to 48% that say it would be bad. i yield mye remaining time to the chairman

of the committee. >> for more than re-years we have heard mounting confusion over how the new health care law would impact families and job creators. we have heard of red tape that has threatened health-care coverage for millions. just 60 days left my constituents want answers. what will premiums look like for millions of americans? taxpayersill american pay? what will ensure they are protected? permanent transition to a part-time economy. the health care law has been a mess for job creators from top to bottom. hhs really ready? the recent decision to delay the

employer mandate makes us wonder if hhs is planning other delays or changes to the law as well. the decision raises questions about the ability to implement the law and the authority to rewrite it. public's anxiety is real, and it is escalating every day, especially as they are left behind to and/or rate shock while businesses are shielded from penalties. -- two indoor rate shock while businesses are shielded from penalties. the promises have become woefully short. this committee has conducted sinceg investigation january of 2011. have dozens of hearings to

ensure the american public has the information they need. it is time for the administration to keep its promises of transparency. i appreciate you being here today. our constituents are seeking real information. i yield back. >> i recognize mr. waxman for five minutes. >> i am pleased to welcome her to our hearing today. she comes before our committee with an impressive record of achievement, and she was recently confirmed by a huge bipartisan majority in the united states senate. we are delighted to have you here. four years ago this committee thevoting to report affordable care act. we were in markup for days and have heard testimony from dozens of witnesses. they describe a system with

grossy rising costs, inefficiencies, and painful inequalities. we heard how those most in need of coverage, people ill, injured, or born with pre- existing conditions were not able to purchase quality health insurance, so we passed the affordable care act to address these chronic problems in our health care system. we incorporated and individual responsibility requirement championed by such conservative groups as the heritage foundation and put in place in the state of massachusetts by governor romney, created a system built upon the private usedr insurance system and the same free-market model president bush created when he signed into law the medicare program.

we eliminated medicare waste, fraud, and abuse, and we made sure our legislation reduced the deficit. observeddable care act bipartisan support, yet we received united opposition from republicans who did not want to give president obama a victory, and since then the law has become the republicans great white whale. they will stop at nothing to kill it. i would like to share a memorandum released my staff staff this morning that provides more he tell on republican efforts to ensure health care reform is a failure. >> without objection, it will be submitted. >> it describes 10 ways republican leaders in congress and state houses have worked to sabotage the law. as this memorandum documents,

independent, nonpartisan are harsh in their depiction of what republicans are doing. usa today says republicans are using the most cynical tactics on inflicting human misery their constituents. writes that republicans are trying to knowingly damage america's healthcare system on the off chance the damage is severe enough to help accomplish a much larger policy goal. tomorrow the house will vote to 40thl the law for the time. many republicans are threatening to shut down the government. republicans in congress are intimidating groups working to

inform the public about the law. their indiscouraging situ is from and rolling. say -- from enrolling. some say they will not perform basic services to help citizens who live in their districts sign up for the benefits of affordable care act. describedscholar has these actions as sharply beneath any reasonable standards of a let did officials with the responsibility of governing -- of unelected officials with the responsibility of governing. he calls it contemptible. is theordable care act law of the land. because of it tens of millions of americans will soon be able to receive high-quality health

care coverage for the first time. others are working to make sure the law works. constituents will enjoy these benefits. i thank her and the department for their work, and i look forward to her testimony. >> the gentle man yield back. . welcome mr. pitts >> thank you for appearing before us today. four months various entertainment officials sibelius secretary have been telling congress implementation of the president health care law is in track -- is on track, it earlier this year we were informed the pre- existing conditions program had suspended enrollment and cut

payments to providers for existing patient. in april this year they ofounced full implementation shop exchanges, which were designed to offer small businesses multiple health insurance plan from which to choose. on july 22 a announced the employer mandate would be delayed for one year. just a few days later hhs announced it decided to theygard the requirement verify individual's income when applying. decision toecent implement what they want rather than what is required, what assurances do we have they will be ready to enroll in just 60 days?

verified such as someone is actually verified will not be too complex and simply ignored? my constituents want to know what to expect and what assurances only those eligible for subsidies will be receiving them. taxpayer dollars should be protected and not hastily spent on the law that may not be ready for prime time or on policies that do not require the utmost integrity. our constituents have concerns, and they need answers, and with the law get until started, i trust you to address those concerns. >> since the affordable care act was enacted in march of 2010, this committee has heard from numerous officials telling us all is well, but we know the

administration is promising one thing and delivering another. the class act had to be shut down because it was unsustainable. in april more than 1400 groups were given waivers for lost mandate. and lawyers had been complaining about how costs were increasing. every employee was given a waiver. the american people get no waiver. theyd in an announcement said they were going to scrap verification. wouldent promised rates go down, but millions of families are seeing the rate go up. when the administration announced it would delay the employer mandate not a single word was spoke. they blame us for

light of transparency. there is lack of trust is the bill was written behind closed doors. the senate bill was different than the one in committee. ,hey have ignored our concerns denied prices were going up, and the administration hired millions of people to help sell it. tens of thousands of employers and doctors and millions of americans who oppose or have great concerns about this bill cannot all be wrong. surprise the public does not trust the administration to properly implement this law. if you are not going to trust the american people and tell them the truth the american people are not going to trust us. thank you, dr. murphy. i live in a town of about 15,000 people just south of dallas. this was the headline july 17, 2000 our team. budget,e squeezing the

total cost to jump 50,000 monthly. city employees will see their health insurance rhenium cost more than double -- premium cost more than double in response to the affordable care act. it goes on to outline what those costs are. many cityays employees are going to opt out andhe city insurance plan take chances in the health up ande if that gets running. madam chairwoman, that says it better than any ring i could say. -- anything i could say. i will submit that. >> without objection, so ordered. the affordable care act is now the law of the land, and it is alreadying benefits to

millions omerica, but today we are standing before one of the most important moment, and that is implementation. we are just two months away from -- open and rollman enrollment. that is why i would urge my colleagues on both sides of the aisle to work on educating constituents on how to make this for individual families and businesses. i remember when we passed the bill and the democrats did not like it. could not like that they not negotiate prescription drug prices. instead we worked with our constituents and let them know how to enroll. why? because this would help our constituents, and now medicare has become very popular. i met a lady when i was in denver -- she is 58 years old and paying $600 a month because

a pre-existing condition. i told her as of october you will be able to enroll and possibly save a bundle of money. she had no idea this option even existed, and i think it is our job as elected representatives of our constituents to go out there and help people like this they can get the insurance they need and save money. an important step to doing this ando make sure we go home talk to our constituents about that. i am really looking forward to hearing what the administration is planning to do to make sure people know about this. earlier this month democratic staff released fact sheets about the affordable care act, and i would ask unanimous consent to put those fact sheets into the

record today. >> i would like to share some of the information from my district. already and my district the affordable care act is providing aid house and young adult with coverage from their parents plan. seniors have gotten drug discounts worth $9.3 million. almost 300,000 of my constituents now have health coversce that preventative service without co- pays. hundreds of thousands of my constituents of private insurance are saving money due to provisions that limit overhead cost, and when the law overly goes into affect, 100,000 of my constituents who do not have health insurance would be able to get that insurance without fear of higher rates because of a pre-existing condition. even if you disagree with the law, it is important you know

how benefits are already affecting our constituents. we have had many hearings on this law, many in our oversight investigation subcommittee, and one concern we have heard is that premiums will be too high. we are beginning to get answers. an analysis found in the state available, it is would cost on average 18% less than the rate predicted by the congressional budget office. on the small group market, the average premium small employers would pay is eight teen percent lower than the same cost after the affordable care act. in lands arethe lowest 18% less than the status quo.

it seems like every day we are getting more information about the new state where competition is causing insurers to lower their premium even more than expect did. -- than expected. the actual cost will be much lower once affordable care act tax credits go into affect. i know you have to be pleased with this, but your job is not done. do not think everything is going to go completely smoothly, but i want to hear what the administration is doing to deal with foreseeable problems and developing systems to deal with unexpected problems. i we all have legitimate questions. we are happy to have you here, and i look forward to hearing your answers. welcome ourike to witness.

she is currently the administrator for the center for medicare and medicaid services. the second ranking , overseeing operations. you are recognized for five minutes. thank the like to chair man. would check your microphone. let's pull it closer. >> how about that? you forlike to thank inviting me here today to update you on implementation of the affordable care act. i am pleased to say you are right. 60 days from now

americans will be able to enroll in affordable health care coverage, and that implementation is on track. this denver, --cated and complicated endeavor. my clinical profession keep in mind the reason we are here. deserve high quality system. my perspective comes from my days as a hospital ceo, where i not only managed, but where i had patience oversee me to tell me they did not have health insurance. families hard-working who could not afford health care bills.

i would sit down with each person, and we would work out a payment plan. i could not stand to see that family have to file medical bankruptcy. i would continue to help everyone who asked for my help, but the concern was those who did not know how to ask. finally i had the government's perspective. i am extremely fortunate to have a dedicated team who has experience and programs that cover millions of americans and also have experience in transformation including programs such as medicare advantage.

i consider partnerships as essential to my leadership role and have made it a point to partner with stakeholders. with hospitals, health insurers, providers, and consumers. limitation of the affordable care act depends on the hard work of thousands across the country, and we are all in this together to make it a success. i am energized to implement the affordable care act. i am thinking about the staff nurses who are able to focus on coordination and the ceos who will not have to put people on payment plans. instead they will have to get people on health insurance. i am thinking about those who will benefit from new tools from modernized systems.

we begin enrollment we are seeing changes in the delivery system. growth in national health expenditures over the last re-is lower than any time in the last 50. of beneficiaries are getting better care. for health insurance markets we are is hearing improvements from increased transparency. new competition and choices are pushing costs down. premiums, andnced i can go on and on. we are motivated and well prepared for the work ahead. we are motivated to refine our systems and get the word out.

we are proud to reach this challenge and help our fellow americans. i am focused on your questions. i hope we will engage in dialogue and that my answers can help you respond to your thank you. >> thank you. we appreciate that. we will begin our questions. i begin by yielding myself five minutes. i want to start by talking with you about fairness. coming into our meetings with papers on hand, and they can document the higher premium, the disruptions in their existing coverage, and show me where it is due to the affordable care act, or they are, and, while looking, many of them are reprieve fromme

the taxes, the penalties, and the increased costs, you and your employees are fully protected. to keep theible insurance coverage that you have, which, you have taxpayer dollars paying for that insurance. i want to ask you this. if you are able, are you willing to enroll yourself in an exchange plan, october 1? anif i were eligible for exchange plan, i would happy -- be happy to enroll in an exchange plan. >> should employees who are all responsible for implementing enrollw be required to in the same plan americans are being forced to enroll in in these exchanges? >> chairman, i would say if congress decides the employees should be enrolled in exchanges, the employees would support that. >> would you support a bill to that effect? you and all cms employees?

>> i would be happy to work with you on the development of a bill. we can discuss that. >> you think all government employees, whether they are at treasuries, ahs, labor, the white house, that they should be subject to the same lands? i remind you that if you look at the affordable care act, remember there are a large number of -- >> we remember well. >> that are not subject to the formal care act. >> that was not my question. would you support having all these government officials having to enroll in an exchange plan? everyone involved in implementing this? >> to the extent that, if you look at the exchanges, exchanges offer full coverage at reasonable prices. we are promoting competition. we are promoting transparency. >> we are in the dingell room so i will ask a dingell question, yes or no?

>> yes. >> thank you. cms has awarded at the fax, a contract to conduct a concentration of attentional applicants. what is the estimated percentage of potential applications where income data can be verified by echo fax, given the volume of data it currently controls? ,> there is a lot of confusion so i would like to spend a couple of moments talking about that from the standpoint of the federal exchange. if you look at what happened, when individual fills out an application and they record their income, there is a 100% check, irs. there is also 100% check against echo fax. if those two, obviously, were, match, the individual proceeds. if there is a discrepancy, we

begin an intervention, >> let me ask you this. otheru going to contractors who are there to assist in verification of potential enrollees? i am asking you this because the self attestation provisions are a tremendous concern to us, especially to me, and you are familiar to what happened there with self attestation. and government -- the governor's efforts to pull all these individuals off the program. you know. tell me how you are planning to handle that. .> we would do a 100% review >> immediately? >> immediately. individuals -- when i say immediately, it is a process where individuals bring in pay stubs and information so we work with -- within enrollment and eligibility. of all00% review means

of their self declarations, you will go back through every bit of that. fact that is correct. >> if not immediately, by when? >> what we have in regulation is if an individual attests to their income, we animal them -- and roll them for what they are eligible for. we have 90 days to reconcile that. >> you for see having all of this completed on each generally within 90 days and if someone is committing fraud, how quickly will you remove them? , asf someone is incorrect soon as we find out there is a problem, if they are not eligible for tax credits, they would be removed immediately. >> i yield five minutes to mr. westman. >> thank you. you were asked, is this fair that your employees are not going to go into the exchange.

most people who are working in this country will not go to the exchange because they have their insurance through their jobs. to they going to be required go into the exchange and drop the insurance they already have? >> apsley not. >> so, if employers officer insurance to their him please, that is not going to be affected. what we have tried to do is give accents -- access to health insurance for people who do not have coverage. isn't that right? is that what that exchange is all about? >> that is correct. >> it seems to me is our to hear arguments, well, you're going to go to these change. if you did not have insurance, you would be delighted to be able to go and buy health insurance. people lose their jobs, and we have seen a lot of people their jobs in the last couple of years, they usually lose their health insurance. there is a thing called cobra which allows them to pay a full

both the employer and employee side, to keep their insurance. they will not have to do that anymore. they will be able to go to the exchange and choose between different private insurance plans that will be affordable to them. >> that is correct. lex i find it amazing, this attack all the time by the republicans on the law. it will help so many tens of millions of people get insured. the insurance system of the country is not going to be transformed overnight. we're going to keep medicare for people on medicare. people have insurance with their employers and they will keep it. we hope small businesses will cover more of their employees. we are giving them tax breaks. small businesses, if they do not cover their him for leaves, they will go to the exchange. either their employees or the toloyers will be able to go

the exchange. when you have an exchange, you are pulling people together so they have the advantages of the big employers in getting better insurance at a lower cost. otherwise, with a small business or small group or individual, right now, if you are an individual, you have got no standing. the insurance companies do not want to insure you if you have a pre-existing condition. when you are in the pool with everybody else, they spread the cost. is that the philosophy? >> that is correct. that was the point i was trying to make with the congresswoman. if i could not get insurance today, i would be happy to have the exchange of available. these are good plans at good prices. >> we hear a lot about rate shock. people have been scared by republicans and right-wingers who want to scare people about the act itself and what it will mean to them, even chairwoman blackburn alertall the increase.

you hear about the predictions and major increases in costs, they are not correct, are they? >> what we have seen to -- seen today, and i mention in my opening statement, we are seeing a reduction. it is coming in around 18% below estimates. we are pleased. we are in the process of finishing up the federal exchange rates. july 31.until we will be looking at states on the federal exchange. for state-based exchanges, it has been good news and we are pleased. it speaks to what happens when you have competition and transparency in the marketplace, plus, the number of insurance laws we have been able to adjust in the last 3.5 years. >> that is interesting. are goingeit speaks to the coss

down because of transparency and competition. >> i do. >> i believe that, too. if you have got competition, you will look at the best product at the best price. when these companies are competing for my business, they will want to hold down their costs and the benefits will all be the same because the essential core benefits will be the same in every plan offered on the exchange. that iscorrect? >> correct. the things we have done have not only had a benefit on small businesses and individuals. when i talk with large employers, what we are seeing is they are reaping some of the rewards, as well. are goingage increases down because of transparency and competition. around 33%. we do not want any increase, but three percent a lot better trend than we were seeing in the past. >> most people do not have a choice of their health insurance. they are lucky if they get any health insurance at all. they have got to pay the price,

whatever it is. if they cannot afford it, they cannot get it in this country. is toms to me the attack keep things from being transparent and to prevent competition and help the consumers. that helps the insurance companies lot. thank you. >> thank you for your time. >> wow. ok. i was thinking i was later in the queue. i am ready to go. in my opening statement, i quoted from the news from july 23 that the city increased in their plans may provide to their .mployees was going up double a monthly cost was about 50,000 a month for the city. the deductible was going up. the deductible was tripled. the city saidwas its

largest increase on any budget item in the budget. what is your response? >> i would want to take a look at that article. i am happy to sit down with you. >> that is easy. we will make that happen. i listened with interest at ranking member waxman's questions. livingi are apparently in parallel universes. go to my town halls or i am out in my district, i do not have anybody coming to me saying for thenot wait affordable care act to be implemented and they are waiting when theyreat day can get all these benefits. i hear just the opposite. i hear small business and saying they will not be able to

the cityhe coverage employees in the town and i live in, they are complaining about how their premiums are going up and benefits are going down. we have you come and say, even though we are going to allow income variability -- verifiability based on self we are going to verify 100% of the self attestation spirit that does not make sense to me either. do you have data on 100% of the to verifyopulation income levels? i was told that was not available, which is why you were willoing to use it. >> i try to answer all of those questions. let me start with the income verification. there has been a lot of confusion.

a reminder that when an individual records their income, it is first checked with irs based on the 2012 tax return -- tax returns. if there is a match and they are eligible, there is no need. you are obviously telling the truth. but we are able to check it. there is a second check through equifax. it is only when those two do not match that you have to go further and ask individuals for pay stubs or other information. that is where i am saying we will do 100% proofing. a subset of the whole population. >> i hope you're right. >> i know i am right. >> i voted against it every time i could. i do hope, for the people's ,ake, if we will amend it you're right. >> to answer your question about businesses, just a reminder to individuals, if you are a small business, you are

exempt from the requirement. >> less than 50 employees or your average worker works less than four hours. >> us than 50 employees, you are exempt from having a requirement for coverage. we hope individuals will do that coverage. we want more people coverage -- covered. for large employers, here is what i am hearing. when i start talking to them about their average cost increases, you are seeing very low cost increases in terms of premiums. it does not mean some employers are not increasing their deductibles or co-pays, a business decision separate from the affordable care act. the last thing i tell you is if i ever leave, i have been in tech, florida, louisiana, georgia, virginia, i can go on theon, if i ever lead with affordable care act, individuals are often confused about what i am saying. if i lead with something like this, if you have had a pre-

existing condition and you cannot get insurance or it is $1500 a month and you cannot afford it, on january 1, that does not exist anymore and here is why. if your child is covered to age 26 and you are happy about it, and you do not understand why, here is why. >> that is the only group that does benefit our people who did not have and could not get coverage before it. that one percent of the population does benefit is -- if the coverage is available. >> it is more than one percent. >> the gentleman's time has expired. at this time, i recognize the gentleman from michigan, mr. dingell, for five minutes. >> i thank you for your courtesy. i thank you for holding this hearing. thank you, madam administrator, for being here today. we are 60 days away from the open enrollment.

october 1. we are at the cusp of implementing reforms and we will see it -- see to it that health care is a right and not a privilege. we are close to full implementation of the law. against those who want this legislation to fail. ,hat would be a dreadful shortsighted policy, which would hurt the country very badly. my question today, is for some of the benefits we have already seen from the affordable care act and what we may expect in the forthcoming months. please answer these questions yes or no. when the new health insurance marketplaces be up and running for open enrollment, as scheduled, 60 days from now? >> yes. >> i would like you to give us a brief monograph on how the different states will be doing,

because some will come in and some will not. if you could submit that to us for the record. just this month, the department of treasury asked that employer responsibility provisions were delayed for one year. the this decision impact implementation of the timetable for the remainder of aca, yes or no? >> no. >> would you you like to submit a brief paragraph explaining that issue, please. the next question, one claim i've heard recently is the employer delay will limit the ability of the government to verify the incomes of applicants for the purposes of determining the eligibility for subsidies. will the marketplaces have income verification measures in place during 2014? yes or no? >> yes. , madam administrator, you go

from between 1999 and 2012, the cost of coverage for an average .amily rose by 100 72% is that correct? >> yes. >> when the marketplaces are up and running, we hope consumers will have a greater choice among health plans than they currently have in the individual market. that a real expectation? >> yes. consumers across the country will reap the benefits of increased competition through lower rates. we have seen extraordinary results in california, oregon, washington, and vermont. most significantly, in new york, rates will go down by an average of six percent. administrator, do you believe increased competition amongst in anyes is

way responsible for the lower rates we are seeing in the states? you >> -- states? >> yes. in your testimony, you indicated americans had saved over $1 billion in health insurance premiums thanks to this provision. is that correct? >> yes. >> you discuss how the average premium increase for all rates what itwas 30% below was in 2010. is that correct? >> yes. you submit a brief comment on that answer? >> yes. the trend willve continue into the future? >> yes. >> could you give us a brief statement as to why that might be so? now that we are on the precipice

of understanding the law to the extent and the affordable care act is the law of the land, we should all except this fact and work together to ensure implementation goes as smoothly as possible rather than moving for the law to fail. i know that is what the american people want of us, i hope we will be doing so. i thank you for holding this hearing. i thank you for your presence. i yield back with 17 seconds remaining. >> the jumping yields back. five minutes. >> thank you. let me make a couple of comments. i would be much more willing to be lectured by norman if he ran for office and had been elected and had represented constituency, then just another d.c. pundit who can throw out accusations at whether or not we are doing our job. i just put that on the record.

for diana,thing is, who is a great friend of mine, i would take the question with your premise of how actively my friends on your side actively promoted medicare d. i know i did. if we could go back through the record, of the people who had town hall meetings, and actually tried to enroll people in medicare, i think we could get a better idea than just making the statement. i will say, because i have been struggling with that issue of how do i get involved in this role and working with my state and its exchange. the problem is, we have had so far and each briefing is different and we do not have the information yet and that is the state of illinois. be happy to sit down with you or anybody else on your side of the aisle and talk

to you about what i have in doing in my district. that.o not doubt i am just saying, making the were of how much you all out there pushing that, i am questioning it. >> i will tell you what i did about that. i am happy to. >> our folks in the mode -- in the media can do due diligence and decide whether or not they want to research that were not. i would question it. now, it is great to see you. she has been in my this trick before. great credibility. a lot of support on both sides of the aisle from the senate. thank you for being here. i know you have got a tough job. i want to refer to quick questions and one deals with the theimony on how you used state of new york and we talked about the premium issue. did you knew -- did new york require all to issue two other applicants, guaranteed issue? >> they did. >> did they not already

restrict rating? >> i believe that is correct. ,> part of the debate on this they are already high state insured, the fourth highest in the country. they are doing a lot of stuff this law is forcing them to do. you would expect their rates would not be as high. they are already doing somebody's new ads, versus a state like illinois. our issue is not the coverage. our concern is people who have insurance will lose insurance. that is our debate. people who have employer- sponsored health care will lose their healthcare and be forced into an exchange in which they will pay 30 or 40% more. i am not doing an anecdotal story. i read this on the floor of the house yesterday during a one minute speech. it is from a small businessman

from hamill, illinois, in my district, and he says last week, insurancesed by my agency of increasing my rates by more than 38%. one employeeease and advise all remaining employees their increase health insurance premiums will be passed on to them. i was probably able to pay 100% of the employees health care coverage, but after consecutive 20% increases in the last three years and the latest 40% increase, since bill business -- simple business logic says ipass this or simply go out of business. my employees will have less take-home pay under obamacare, and here is the question because does anyone in, congress realize under this ill, it is more logical for me to shut down my business and take subsidies on one of the exchanges than to remain open? do you all understand this is what small business is dealing

with? >> you know i have great respect for you and i enjoy being in your district. i would be happy to sit down with you and go through this one. would you call the mic? >> i'm sorry. i am saying i would be happy to sit down and work with the congressman in this issue. i am curious to see the process that went into that. if they have had years of 20% and 30% increases, this was prior to any influence. >> this one is 40%. that brokethe straw the camels back for this guy. >> right. this is the very issue we are trying to address. down and worksit with you. >> the debate really is we are afraid premiums go up and jobs get lost and more people go on to the exchange and cannot afford the exchange amount, which they had when they had

employer-sponsored healthcare. that is the difference in this debate. thank you. >> mr. rush for five minutes. >> i want to thank you, mr. chairman. i want to send a warm welcome to you for your appearance before an the committee today. forso want to thank you sending your staff to assist me and my staff to the affordable care act town hall meetings and other events in my district. my constituents were happy to have them, learned a lot from tom, and are looking forward having more interactions with your excellent staff. i want to ask you about the administration decision to inay the employer mandate generator 1, 2015.

is there a lot of rhetoric from aboutublican colleagues how this decision is going to derail implementation of the aca, or somehow, an indication that the law is unworkable? implementing quattro elements of the law, and these include health insurance marketplaces to make sure every american has access to quality, affordable coverage, even if they have a pre-existing condition. they stop insurance from spending 70 or 20% when we enroll these premiums on profits and make them spend more on actual health care.

then there are insurance market end of such as the lifetime in annual limits on coverage. the requirement that insurance preventive care -- all of these patients, not the insurance company in charge of basic healthcare decisions. what does the recent decision means for the elements of the law? the cms is charged with implementing. people do not receive health care coverage from their employers just year -- next year will be able to afford affordable high quality state orthrough the

federal marketplaces. i think that is correct. would you answer those questions? >> yes. delay of the employer mandate does not have any impact on cms's implementation. this is a reminder. the delay of the employer mandate was a decision to try to work with business. i heard this morning we need to work with is and help them. of larger also, 96% employers currently have coverage. an employer mandate was always a very small subset. the decision to delay for one year was to try to help, not increase, we regulatory employee -- employers on burdens, and it has no impact on intimidation. >> it is safe to say the employer mandate for a year is not more -- the core elements are going into effect as planned? >> yes there.

-- yes, sir. and illems to me wrong informed by my republican colleagues to try to use this relatively minor transitional relief to try to sow doubt and confusion about whether this law is going to infect. coldhearted,ooded, and callous. they should be ashamed of themselves. i yield back the balance of my time. >> the gentleman yields back. mrs. pitts for five minutes. >> thank you. on april 10. 2013, the office of management budget released its report for fiscal year 2014. in this report, it ought to be confirmed the cost-sharing issidy program in the aca

subject to sequester 27.2% 4duction and a reduction of billion dollars. has cms communicated to officials operating in exchange, both federal and state, how the sequester will be applied? >> we have not. we are still working. >> will the navigators and other assistance personnel be expected to properly explain to enrollees the cost-sharing levels under the sequester? >> that is under review. i would have to get back to you on that. >> does this mean applicants may not be aware of their financial liability when signing up for an exchange planned? >> once again, i will follow-up with you after i've had a discussion. given that the department has had significant time to prepare

for reductions in cost-sharing subsidies as part of the sequester, is this information available to the public? >> i will have to work with ownby and get back to you on that. >> can you commit to providing detailed -- detailed information regarding the implementation of the cost- sharing subsidy program? >> yes. i can commit to providing you information. it is our strong preference that the issue of seek >> ration go away entirely. >> will this implement -- information be available before open enrollment, which starts october 1, 2013? >> yes sir. ask the sameean to question again, but actually -- are you actually testifying in front of this committee that agencies will likely be given exchange subsidy applicants and complete information about their

financial liability, telling my constituents to talk to omb is really not an answer. .s i am not saying that i am saying i am will follow-up and get back to you with an answer. >> another question. has cms conducted live in testing involving all parties for implementation, including department of homeland security, the social security administration, the treasury department, opm, state medicaid agencies, state exchanges, and associated contractors? >> that is several questions. let me try to answer them one by one. we started testing in october of last year. october 2012. as we test, we move from basic to more complex scenarios. we will finish all testing by the end of august.

when you talk about systems, let me start with insurers. we have accepted their submissions for more than 120 issuers. testing enrollment those scenarios in july. they will be complete by the end of august. , payment testing occurs between september and december. payments do not go out until january. >> i only have so much time. -- have had one live tax test with all the agencies? >> yes. >> what vulnerabilities and challenges has such testing revealed? i am happy to give you a more detailed explanation from our i.t. folks. any phonetified abilities we corrected him. we are in good shape. >> ok. do the contractors, who hhs is paying to build these, have

certain milestones they need to meet? >> absolutely. >> can you tell us today every contractor has met these targets and is on time. >> yes. i can. >> will hhs provide audits or where it plans to show the committee where the contracts were? >> we will provide anything we can that is publicly available. i am happy to have people come sit down with you and walk you through our testing. >> have any contractors asked for delays for their contract deadlines? >> no. >> my time is expired. thank you. >> the gentleman yields back. five minutes. >> welcome. thank you for the work you are doing and what is truly historic. it is a heavy lift. it has many working parts.

hundreds of millions of people in our country. withnk the confidence which you have approached this, and the experience that you bring to it will only enhance the pulse check on the affordable care act. my colleague from illinois does notd that norman have any skin in this game because he is a scholar. and he is not selected. are nottituents elected, either. scholars are not elected. but they all count in our country. i think norman and tom are recognized as the two preeminent congressional scholars. neither republicans nor democrats do they claim.

i do not know how they are registered. what they write and how they think. i think we can all draw something from it, whether we agree or not. i did not think i would get to norm this morning. i cannot help but jump and say something about just because they are are not elected as -- elected, they do not count. something extraordinary is taking place, not only the implementation of the aca. but the counter push in the house of representatives where, for the 40th time, not fourth time, but 40th time, that the republicans are moving to repeal the law. i willt know, and maybe have to check with norm ornstein or the librarian of if they're asee ever been any such effort in the

history of our country where something has been taken up 40 times. thelieve my friends on other side of the aisle are on the wrong side of history. now, i think what we need to examine is what people are now ,egally entitled to, as a right not only having been passed into law, but confirmed by the united states supreme court. none of that seems to matter. they are0th time, going to move to repeal. i would like to examine this through the lens of constituents. and the right that they have and the rights that colleagues want to take away from them. these are very important things that my colleagues want to take away from them.

they want to take away closing the prescription drug donut hole created through the program they passed. away fromto take children the ability for them to stay on their parents insurance policy up to the age of 26. they want to take away from them what is now prohibited, and that is the lifetime limit caps on insurance policies. thatan anyone argue lifetime limit caps were terrific? take thatguing to away from your constituents. you want to take away preventive services from your constituents, like mammograms and colonoscopies. do you get those now? ,oesn't your wife, your spouse enjoy that now? why do you want to take that away from your constituents?

takeaway health care premiums truly spent on medical care, instead of advertising, and the right to plain language explanations of a plan benefit, and most of all, takeaway the freedom by decimating the whole issue of pre-existing condition. that is taking away a lot of people havemerican today. i think that is the lens in which to examine this. i would just like to ask you, madam administrator, very quickly, about the flexibility states have. there has been an awful lot cost a lot -- tossed around that states are going to hell, people are being forced. can you spend a moment to explain the flexibility states have that our states are being offered in this? >> yes.

, there are various types of programs. 17 state-basedve exchanges where they have tremendous sex ability. they are establishing their own programs following the law. , we have oversight. the second one, we have created various types of partnerships to work with states, such as in utah, where they wanted to be involved in shops. we have created other partnerships where states wanted to keep their review of health plans or they wanted to do consumer outreach. >> if you would submit for the record, we are a minute over and we are trying to keep it to five minutes as a courtesy to all members. thank you. at this time, i yield to mr. terry five minutes. >> thank you. . appreciate you being here

i will ask you questions about transparency and if information is being withheld from the committee regarding particularly data hubs. isi understand it, hhs contracted with a number of companies to help the old different parts known as the data hope. is that correct? >> it is actually single contract. >> it is single contract. healthcare group, their subsidiary qs as i, that is contractor? that is correct. >> last month, geo -- gao issued a report saying the exchanges are behind schedule. number of news articles in the last month have talked about the expected glitches in the fact that companies setting up these decisions is racing to get

it done in time. this committee has asked united with aare to provide us briefing on the status of the building of the data hub. they have refused and told us to talk to hhs. , as unders or you hhs, told united healthcare not to talk to us? >> i have not. . have not said that >> do you have any concerns about united healthcare/qs as i ?alking to our committee >> we have frequently -- >> yes or no. do you have a problem with united healthcare talking to this committee? >> i do not have a problem with that. we have done that in the past and brought contractors with us to talk to committee. >> ok. do you think it is a fair

conclusion that when somebody refuses to talk to you that they ?re hiding something >> i do not think that is a fair conclusion. >> you do not? >> you do not? you do nothing when someone refuses to talk to you there is a reason behind it. >> i think we can work this out. >> when united refuses to talk to us, they are not hiding anything. they are just being a good company? >> they are a good company to work with. >> ok. ? i will ask you than what they will not talk to us about. how much money has hhs paid united healthcare in qs as i today? the qs as i contract, we have spent about $400 million today on the building of the hub, if you would let me, i would get you specifics. is dynamic. i may have data that is a week or two old. is it on schedule?

>> yes. >> have they met each of their targets set for the work? >> that is something i am happy to review with you in detail. i do not want to speak to each and every target. >> you would have no problems with us talking -- united healthcare talking to us about that as well? >> i have no problem with that. we would with -- we have done that in the past. >> has united healthcare/qs si done test runs of the data? >> yes. >> have there been any glitches discovered? >> i would have to go to the specifics of that. >> that low point in doing a test. >> the testings things, we made modifications and the system is working. testedunited healthcare nntis with the relevant

agencies, such as social security administration? >> yes. >> have they tested the connections with homeland security? >> yes. i would be happy to give you a schedule of the testing. >> ok. same question with the internal revenue service. >> i am happy to get you a schedule with the testing of each of our federal partners. >> with state medicaid programs? >> yes. it is in progress. >> good. , are thereactors ?thers, will you tell us what fax answer close involvement is? >> equifax involvement is income verification, as i was discussing earlier. sohave a contract with them that when an individual completes an application and fills out their income, we check

that against the irs records, as well as? fax records to verify accuracy. >> thank you. >> the gentleman's time is expired. five minute. >> thank you. i want to add my thanks to you too for coming and testing today. are going hubs that to be managed by hhs, and that are going to provide access to information necessary to determine an individual's eligibility for certain benefits. the denver post, in part of what seems to be a national campaign on this issue, there was an op-ed that raised concerns about the privacy of data that is going to be provided to individuals who signed up for health insurance on the federal marketplaces. , after the recent leaks on the nsa, we are all concerned about privacy.

stated, in my opinion, a little hysterically, the federal data is a privacy disaster waiting to happen, drawing from databases of seven different u.s. agencies, including the department of justice and the irs. i hope you can help us address some of these concerns about data hubs. first, very briefly, what are these data hubs? >> there is a single data hub. situation.important it serves as a router. the hub does not store any information. it routes information. the second point is there is no health information stored or gathered. information is involved? >> what the data hub does, if you fill out an application, that automatically, pings social security.

so we verify what you are entering is a social security number, it matches you as an individual, and then it will also paying social security if you are eligible for other types of programs, which would make you ineligible for tax credits. .hen it will move it moved through each of the systems that make. homeland security. you are verifying that person is a legal citizen. you are verifying they are eligible for other programs, such as tri-care, and so you're making sure this individual is eligible for a tax credit. the routing information, no storage -- so once the information has been checked against all the sources you just talked about and confirmation has been forwarded back to the appropriate marketplace, what you are saying is the him -- the information is not stored? >> not stored in the hub. when the individual completes an

application, we do store that application in the marketplace, a separate peace. if you're making an appeal or whatever, you could go back to your record. we do not store health information. >> the information stored in the marketplace, who has access to that information? enrollment and eligibility workers, either through the theirexchange, they have own and enrollment eligibility workers, or we have a single contract, a circle contract. >> what will we do to make sure those workers do use the information inappropriately? >> there is a series. our security, the history of cms, we handle millions of records. we have very tight security control. the privacy act, we follow all the security requirements and agreements. >> let me ask you, could you

provide us with a short written answer of what the agency is doing to ensure consumers privacy? >> yes. it will be a lengthy answer. >> that is good in this situation. one last issue i want to talk you about. we keep hearing people talking about, again and again, how healthcare informal increase healthcare costs. i wonder if you could talk briefly to us about recent trends in medicare spending growth? >> we are very pleased with the recent trends in medicare spending growth. we have seen the lowest growth for three years in a row ever. in medicare spending. we are very pleased with that. we think it is a combination of things. there are payment reforms we have put in place. we are most excited about our delivery system reforms. excited about those because they are actually changing from paying two quantities to actually paying for outcomes. we are taking this delivery

system changes and we are spreading it across only medicare but medicaid and we are working closely with the private industry to make sure this is an effort. what we are trying to do is actually change the system so that we have coordinated care at lower costs and that we are actually focused on the high cost, which are complicated care, complex, long-term, chronic disease. it is a combination of things. >> thank you. the gentlelady yields back. dr. murphy, five minutes. >> thank you. i just want to make sure we are still working on this. your and the administration's intention to respect and adhere to the constitution's first amendment, freedom of religion and the implementation of the first law of this. >> yes. >> thank you. i want to ask you a simple and direct question. has this resulted in cutting

workers hours because of the mandate? >> no. >> ok. let me tell you a story here. a gentleman contact me all-time jobs, one with the transformer manufacturer and another with the restaurant area he has a health insurance plan with the transformer manufacturer. the restaurant says they have to cut his hours to part-time, otherwise, they would have to provide them with health insurance. he asked if there was a form to to improve his health insurance. we call the department of treasury asking their -- asking if there was anything they could do. said item we spoke to is an issue between the gentleman and the employer and there is no way for the federal government to prove the restaurant he has insurance with another employer. they have no solution. thehe answer administration given to people acceptable under those circumstances? they have no way of working on such things? >> i cannot speak the treasuries answer but i will tell you -- >> do you have any solution? >>

yes. i have met with small business, large business, we are not seeing folks changing their hours. we hear anecdotal stories as well. life must go back to the parallel universe situation. when we had, before my subcommittee, oversight and investigation on the eighth in your advisor for the partner treasury, is one of the issues of why we needed to delay the mandate is because there were a number of problems. when asked specifically if he was hearing from individuals. they do not have to area i asked what his interest was. i'm hearing from you. for people either. i think that is a problem. to can america's right to get you back. apparently, you are not in them and employers are cutting back hours and losing out to should --y just write to you? cutting back hours. hould they just write to you?

the fact that he -- >> the fact you are saying you're not hearing anyone losing ours is phenomenal. understand this is a law. we are trying to get transparency. when you and the administration hide things in a fourth of july law or in the middle of some other document, or one bill appears before us in committee and another one appears before us on the floor, and waivers are granted to people, there is something wrong. let me ask about this, too. some of the law's original employers, labor unions have you hadthis was -- have discussions with the unions about impact of healthcare with the coverage? >> yes. >> did you see the full paid -- full-page ad in washington post about the laborers international, the treasury employees, the united union

refers water provers and allied workers, saying it threatens to harm their members, that it takes money from the pockets of each laborer, it takes coverage away from employees -- have you seen is that -- this ad? >> i have not. >> it is in the paper and you might want to take a look at it. this is no small concern. you have notg heard from people. these folks represent thousands of workers were saying they are seeing real problems here. >> i said we have ongoing problems. >> this is 20 69 people. that is more than significant. you are saying you are not aaring from people with problem? >> for the third time, we have ongoing discussions with the labor unions. >> -- we have further concerns. >> are you hearing from them there are problems with people losing their jobs and cover? >> i have not heard that specifically. readuld you like to

today's paper? this is not the first time they printed this article from washington dc. universe.e parallel i understand this is the law. our concern is if you are all living in alice and wonderland, you cannot manage what you cannot measure. you cannot measure what you are not paying attention to. although there are people on the other side of the aisle saying we are not handling the right way, this is our obligation to make sure we are providing the kind of oversight to this. if you're not listening to to the american people and labor unions, some poor individual whose context work at the restaurant and say, i do not know to do, i have no answer for him. thank you. >> the gentleman yields back. >> thank you. welcome. we are so happy to have you here and glad you are on board. i just have a few questions here. opponents of reform have spent a lot of energy trying to scare

seniors into believing they were losing medicare benefits because of health reform. i would like to take this opportunity to correct this misinformation. true that no senior will see their guaranteed medicare benefits reduced, whether in private medicare advantage plan, or traditional medicare, where seniors have free choice because of the affordable care act? >> yes. >> with the improvements, benefits actually improved for all medicare beneficiaries? correct? >> correct. >> in your testimony, you stated almost -- over 6.6 million seniors have saved $7 billion on prescription drugs as a result? >> that is correct. >> 7 million medicare beneficiaries have taken advantage of at least one free preventive service thus far in

2013. greg? >> correct. >> thank you. i will make sure my constituents understand that. we all agree illuminating waste, fraud, and abuse in medicare and medicaid should be a top priority as we seek to reduce spending.

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[captions copyright national able satellite corp. 2013] [captioning performed by national captioning institute] it led to cooperation leading to the new start treaty. it provided other forms of cooperation that benefit the united states and the american people, and our national security. throughout the process of the evolution of our relations with russia over the past four and a half years, we have had conflicts with russia, we have had disagreements with russia. we have been extremely clear about those disagreements. most recently and seriously over syria. that has been the case and will be the case moving forward, but

we should not have engaged in ur efforts with the russians upon president obama's taking office, i would then say that the benefits that were a result of that engagement were not worth it and i don't think that's the case. >> what do you think the russians are up to? obviously, by granting mr. snowden temporary asylum, they must have known this was not going to go over well but they did it anyway. what do you think they are up to ? >> i'm not going to describe motives. i think the russian officials can speak for themselves. we are obviously very disappointed in this development. we have a broadband important relationship with russia that encompasses areas of cooperation and agreement as well as areas of disagreement and

conflict. we had long stated as had president putin that we did not want the issue of mr. snowden to become a problem in our bilateral relationship because of its breadth and importance. we will obviously assess this and be in confrontation with the russian government moving forward. >> you say mr. snowden is not a whistleblower, but given the fact the house last week had a vote on these programs that came very close to delivering a blow to these programs, there has been hearings going on this week. patrick leahy, chair of the judiciary committee, has questioned the utility of these programs and they're having lawmakers over at the white house today, some of whom have called into question some of these programs. didn't mr. snowden in some sense into the american people and people around the world a favor and disclosing these programs given the outrage expressed about them?

>> when you take an oath to protect the secrets of the united states, you are bound to protect them and there are consequences if you don't and here are procedures in place for whistleblowers that are available to those who would blow the whistle, if you will. the unauthorized leaking of classified information has and can do enormous damage turn national security interests those are just the facts. >> he never claim out -- if he did not come out and described them, we would never know. he would still be in the united tates. >> obviously, there has been a great deal revealed because of the release of unauthorized classified information but the fact of the matter is that these are programs that have been reviewed and overseen by congress and reports that ontain within them the

protections that are designed to chieve the balance that is necessary between our security and our privacy and the president has made clear that he wants that balance, supports that balance, believes the balance has been found, but also believes that there ought to be a debate about these issues, a discussion about these issues. e's engaged in that. he is meeting this afternoon, as i'm sure you know, with members of congress, both republican and democrat, both from the senate and the house on these issues at his invitation including members who have been very critical of the programs that we have been discussing under section 215 and

702. the fact is our intelligence services need to have tools available to them to help protect our national security interests, protect us from attack and i think most americans would agree with that. we also design our programs in a way and put in safeguards and layers of oversight to ensure that those programs do not abuse the privacy of american itizens. that is the balance the president was talking about. that is the balance that has been a focus of the implementation of these programs and there is an ongoing discussion about these programs under the administration through the odeon i -- odni releasing more information about them in the wake of the snowden lakes and i'm sure that process will ontinue. i don't think we can sensibly say the program is designed to

t >> the president believes these programs should have been kept a secret? >> you are conflating a bunch of things here. the re-authorization of the patriot act, fisa, these are known facts. congress has known about them. the public has known about them. there's no question there are details about programs that are now known because of these leaks. the president believes that it is inappropriate to leak highly sensitive classified information because it can, and has done harm to our national security interests and put people's lives in danger. >> can you explain to the american people, is this just a legal issue? they are upset because they did not follow extradition procedures?

the snowden still have in his possession things the united states government are concerned about the could be turned over to russian intelligence? >> it is certainly not just a legal matter. there is the nature of our relations with russia, the atter of the release in an unauthorized fashion of classified information and the possible release of more. et's be clear. mr. snowden, since he left the united states, he has been in possession of classified material in china, and in russia and simply, the possession of that kind of highly sensitive classified information outside

of security areas is both a huge risk and a violation. as we know, he has been in russia now for many weeks. i cannot get into further detail about what he possesses or what kind of disclosures there may be or have been, but there is huge risks associated with, as anyone who works in this building and handles classified information knows, removing that information from secure areas. you should not do it. you can't do it. it's wrong. >> am not minimizing the other issues, but is he still a danger? >> i refer you to the intelligence community for damage assessments in terms of damage that has occurred and could occur. i'm not the right person to respond in detail about hat.

>> they said he had not spoke to russian president vladimir putin. has he placed any call since then? >> i forget how long ago he spoke with president putin on this matter, but they discussed range of issues. >> can you express the president's personal disappointment about this turn of events? >> it is reflected in the words i just spoke. very disappointed, extremely disappointed on the decision to provide temporary asylum for mr. snowden. we have made clear both rightly and publicly that there was ample legal justification for his expulsion from russia and return to the united states. that's a discussion we have had with russia as well as other countries that might have been considering providing asylum to mr. snowden.

those views were, i think, clearly stated both publicly and privately so i don't think there was any confusion. >> has the russian government let the administration know ahead of time? >> no. >> senator mrk cain, in addition -- mccain, in addition to calling this a slap in the face said the administration not to look at a wide range of possible reactions among them, the expansion of nato to include georgia and more efforts to deal with incidents. are those things you would broadly acknowledge that could be part of the menu of options before the administration in reaction? >> we are still reaching out to russian government authorities and counterparts to get a formal confirmation of this information that has been publicly announced and to have discussions, further discussions, about the decision

and what has happened here and argue that mr. snowden should be expelled and returned to the united states. i don't want to speculate -- i won't speculate about consequences or next steps. even on the issue that darlene raised. you know i don't have anything to announce at this point. >> this weekend on c-span, live coverage of the governor's association summer meeting in milwaukee, wisconsin. this year they discuss national infrastructure and the global economy. sunday live at noon on c-span 2, book tv's in depth. your gers author and head of pediatric neurosurgery, ben carson. and then on c-span there, 196, from the assassinations of martin luther king jr. and robert kennedy. sunday at 1:00. >> now, we will get reaction from house speaker john boehner on the russian decision to grant

asylum former nsa contractor edward snowden. speaker john boehner also talked about the budget process in this 10 minute briefing. >> good morning, everyone. yesterday i met with the house chairman leading the investigation on benghazi. the chairman has been doing good work, much of it behind the scenes, but i stress once again that we need to get to the bottom of what happened that terrible night, why it happened, and how we can prevent similar tragedies in the future. e are also continuing to investigate the i.r.s. for its abuse of power. there is nothing phony about these scandals, mr.

president. not when four americans are dead, not when the agency when enforcing your health care law has been harassing because of their political beliefs. the american people deserve answers and we will continue to fight for the truth, no matter how badly the administration wants to sweep these issues under the carpet. also this week, we learned that our economy continues to muddle along at an unacceptable pace. this is yet another reminder that under president obama's leadership, our country has fallen into a new normal, slow growth, high unemployment, stagnant wages. it's bad enough that he continues to block the keystone pipeline, which his own administration says would mean tens of thousands of new jobs. this week, he actually much of -- mocked the project and the jobs that it would create. i don't know how he can look americans in the eye you are struggling and see that there is anything to joke about. president obama's economy is no laughing matter.

that's why house republicans continue to work on our plan for economic growth in real jobs in our country. looking forward, washington must confront some serious choices that we are going to deal with this fall. president obama and his party in the house and senate are in denial about washington's spending problem. they have not come to terms with the fact that we must deal with the spending problem, honestly and forthrightly, our kids and grandkids will face a much dimmer future. we won't have prosperity unless we address these massive deficits and debt that is hurting our economy and jeopardizing the american dream. our members are ready to solve this problem. we showed leadership. we have passed a balanced budget. does the president have the courage to stand up to his own party and work with us to truly

solve the problem? i hope o. >> speaking of the budget, yesterday there were problems with the fed bill and they said turning their back on the bending -- on the spending levels in the ryan budget. your response? >> we had some 50 amendments yet to consider on that bill and considering everything else we have going on this week, decided that dealing with finishing that bill in september was the right step at this moment, but i have full confidence that the votes would have been there to pass he bill. >> mr. speaker, there has been ome talk [indiscernible] -- we have heard some criticism about the i.r.s. specifically earlier. in ou elaborate on that

particular? and to those who are naysayers, what do you say to them? >> there is some evidence and it should be noted, as i recall, she used to work there. we clearly have some relationships with the people she worked with over there, but i think our committees are continuing to work to get to the bottom of this and i will let the facts speak for hemselves. >> john mccain and a few other senate republicans talked about a grand bargain. >> we welcome all the conversations we can have. we all know what the problem s. i'm well aware of what they are talking about and i have made clear that we have a spending problem. we have to deal with the spending problem that we have. indiscernible]

> mr. snowden's actions have hurt the ability of our country to protect our citizens and i would hope that president obama would engage president putin on this issue and resolve it in a way that is satisfactory to the american people. >> engage in what way? >> i will let him decide the best way to engage the president. >> he told committee members he wants to do a markup of the bill in late october. is that something that you would work and can you talk about how tax reform might fit into the ouse schedule this year? >> talking about appropriations generally given the progress in both chambers on these bills,

what is the likelihood of a continuing resolution? >> it's clear we won't have the appropriation bills finished by september 30. i believe a continuing resolution for some short time would probably be in the ation's interests, having said that, the idea of operating for an entire year under acr is not a good way to do business i have been working with chairman rogers to try to find a way to actually do all of these appropriations bills. i think it's important for congress to do its work. yes? >> the statement from chairman rogers yesterday, he seems pretty clear that this is a rejection of both the ryan budget levels -- >> i met with the chairman yesterday and his committee. the appropriators have a tough job over the last couple of

years. they've taken a lot of tough votes in their committee, so i understand the frustration that they are dealing with, but i just want to make clear that sequestration will remain in effect until the president agrees to cut reforms that will allow us to remove it. the president insisted on the sequester that none of us wanted to, none of us liked. smarter ways to cut spending. the house has moved twice over the last year and a half to replace the sequester and we saw no action in the united states enate. if they want the sequester to go, we are going to have to get serious about our long-term pending problem. >> the perception between the transportation bill yesterday, the failed farm bill vote and

that republican leadership has lost control of the floor for their conference and mr. hoyer just said that it is very divided -- >> i have made it very clear that i didn't believe every bill that came to the floor had to pass. i believe in allowing the house to work its will. that's the way that the founders intended for the house to work, more members participating in what is happening on the floor than what we've seen in a long time. i'm not the least bit concerned about what some might want to describe as a perception. [indiscernible] >> doesn't it make it more difficult to keep the government open? >> we will take it one step at a time and i'm sure the august

recess will have our members in a better mood when they come back. [laughter] david. >> will the crv part of obamacare? >> no decisions have been made on going forward with acr. >> what do you say to the appropriators? there's a real sense of frustration. what is your message to them? >> continue to work with us. they have a tough job and i certainly recognize the tough job that we, the conference, have given them and they have done very good work. it's august. the members have been at it for a while. we have 435 people trying to come to an grem. sometimes they get frustrated. they got frustrated yesterday.

>> the house has ample time to address certain issues that are outstanding. the democratic whip warned that they think it is a huge deal going into recess. what do you say to your critics that are not pleased with leaving for five weeks? > thank you all. > this weekend on c-span, live live o governor'smilwaukee, wisconsin. infrastruc a depth, on c-span 3

assassinations j and robert offensive >> membersnel ways and i.r.s. offi nd the h means co deadline" for the new healthcare order.on evince isshowing just o theao o committee,t thoctober questis whetr the services, cms, wou b noting numerous reasons for their concerns., e treasury

inspector general for tax administration stated testint te october 1 date and as a result delays and errors. right before the fourth of july holiday, anof a major provision of the law, the liefut doing nothing to aid hard-working americans. three days laterhealthnd human services announced they would rely on self verification when it meho gs subsidies. just this week, we learned that by delaying thmandate, and other $12 billion of be added to the deficit and it will increase ng b$3 billion in new exchange subsidies because the delay will result in fewer employers offering coverage. with these facts at hand, you will have to forgive me if i'm skeptical of the claims that everything is "on track." three years since it hasse and then just 60 days, they are due to be up and running.

we still do not have answers to many crucial questions and, worse yet, nor do the american people. how is the average hard-working taxpayers supposed to navigate this in just a few short months when they have provided no information as to what the real costs will be or what the insurance will look like. to quote one of my democratic colleagues, "when is the white house going to actually get up and go?" if concerns about of limitation were not enough, almost daily, we are reminded of the affected tapping on the economy. businesses are struggling to figure out how it will comply with the law and whether they will have to cut hours, wages, or jobs in order to come fly. -- comply. one small business owner testified before this committee that as a business owner, they what it meant on the fourth of uly. our job creators and their employees deserve better.

american people need questions answered. why are my premiums skyrocketing? how can i expand my business and hire new workers and give employees a raise when i am being hit by all of these new regulations and red tape. why am i losing the insurance i have and like? as if college students were not struggling enough with dim job prospects, this puts an even greater burden on the young. central michigan university in mount pleasant, michigan, said they will limit college student work hours to 25 hours a week. as one student said, students use that money to pay for financing school and it's going to become increasingly hard for them to pay for school when we can only work 25 hours. fear th i.r.s., we now know it's in no position to implement the 47 new powers and authorities given under the new healthcare law. it's likely they will be at even a greater risk of having their identity stolen or private taxpayer information leaked. even the treasury inspector general less than two weeks ago

stated the i.r.s. will struggle to complete all required testing. the inspector general is not confident about the i.r.s.'s ability to protect confidential taxpayer information or protect fraud. neither am i. this is becoming increasingly unfair, unworkable, untenable. with just three months left, patients, doctors, they will have more questions than answers. i look for to hearing an honest, straightforward assessment from our witnesses this morning. with that, yield to mr. levin for his opening statement. >> welcome to the two of you. e look forward to your testimony to dispel so much of what has been said today, the committee is holding a hearing entitled, "the status of the affordable care act implementation." under the pretense -- the pretense -- that house republicans are interested in implementation of the landmark law.

the truth is just the opposite. it is evidenced by what house republicans plan to do in just 24 hours. they're going to push a bill through the house entitled, keep the i.r.s. off your healthcare act. it would prohibit any funding for the i.r.s. to implement the affordable care act. i don't know how more negative or destructive you can be than that. house republicans have made it plain over the last three years that their sole interest -- their sole intert -- is to disrupt the law's implementation. tomorrow's vote will be their ast action, their last action, before adjourning for a five-week recess. fitting signoff for a

congress whose cingular obsession with the healthcare law repeal of her the last three years has come at the expense of so many other issues that are critically important to american families and the overall economy. by the time they leave here friday for summer recess, republicans will have voted no fewer than 40 times to repeal obamacare. the republican mission is clear. on't implement -- destroy. how else can republicans explain why they occupied so much time and wasted countless taxpayer dollars on 40 repeal votes that stand no chance of being enacted while refusing to go to conference to enact a budget into law? how else can they explain why they have leaned on outside organizations including the

national football league, to discourage them from educating americans about current law, health insurance opportunities and assistance that will be available through the marketplace. how else can they explain why they have worked so hard to discourage states from expanding their medicare programs? even when fully federally funded, which will prevent millions of the most vulnerable americans from gaining access to health care coverage. at every turn, republicans have chosen the path of disruption. it is so vividly on display this week as they have sought to deny the obama administration funding needed to implement. how can you say you're interested in implementation when you try to destroy the funding? if republicans were truly

interested in the affordable care act and implementation, they would inform their constituents that a simple three page application for single americans purchasing on the exchange and neither, and i emphasize this and i hope the witnesses will speak to this, and neither the i.r.s. nor the department of health and human services will have access to medical records or other personal history. instead, what do we see? scare tactics and other misguided efforts to convince constituents that to apply for healthcare coverage will be time-consuming and cumbersome. we've known for quite a while that the republicans have no interest in ensuring that americans understand what even speaker boehner himself has cknowledged.

and that is aca is the law of the land. their only interest is to misinform, misconstrue, and mislead the american public about aca. even conservative republican senator ted cruz chastise the republican effort in the house this week. he said, and i quote, "there are a lot of politicians in washington who love empty ymbolic votes. the house has voted 39, 40, 41 times? i can't keep track two repeal obamacare. those votes were by and large empty, symbolic votes that had zero chance of passing." the problem is, in a sense, they are not symbolic. they are part of a destructive mission. thanks to both of you for coming today and all of us look forward

to your testimony. we're sure that you will tell the facts and tell them emphatically. i also want to ask unanimous consent that the following article from the american enterprise institute be inserted in the record. >> without objection. thank you, mr. levin. it is my pleasure to welcome our two witnesses, both of whom bring a great deal of experience and hopefully a great deal of answers from the administration. first i would like to welcome gary cohen. the deputy administrator for insurance oversight from the center for medicaid and medicare services and secondly, the principal deputy commissioner and deputy commission for enforcement at the i.r.s. thank you both for being with us today. the committee has received each of your written statements and they will be made part of the formal record. you will each be recognized for five minutes for formal remarks and then we will go to questions from the committee. mr. cohen, you're recognized for five minutes.

>> good morning, chairman camp, representative levin, members of the committee. since the affordable care act became law, the cms has been hard at work implementing strong consumer protections to hold companies more accountable, give them more coverage options, and improve the value of that coverage. it is not just cms hard at work. thousands of people all across the country are hard at work to make sure that americans will receive the benefits of a transformed health insurance market. they are employees with health plans designing new products that provide greater runout value and they are the staff at state insurance departments reviewing those products to make sure that the rates charged are fair and reasonable. they are people and communities in every state all across the country who are preparing to help people enroll in coverage beginning in october. most americans receive insurance in connection with their jobs

and for those, particularly those who work for large employers, the system has worked well. for the 15% of americans who don't have coverage through their employer, medicare, medicaid, chip, the system is broken. before the affordable care act, many young people and those with low incomes could not afford insurance leaving millions without coverage. women could be charged 50% more than men. insurance was not affordable for many smaller employers because of the type of work that they do or because they have one worker with high medical costs. now americans are benefiting from some of the affordable care act insurance reforms. 3 million additional young adults under the age of 26 are covered under their parents plans. nearly 18 million children with pre-existing conditions now cannot be denied coverage. new scrutiny of rating freezes have saved americans an estimated $1 billion and in 2014, being a woman will no longer be a pre-existing condition. two months from today, the

marketplaces will provide a new way to shop for coverage for the uninsured, those with existing conditions, and individuals who buy at high costs. on october 1, american also begin shopping in the marketplaces and they will be able to fill out one application to purchase private insurance qualify for premium tax credits, and reduce coverage sharing. or obtain medicaid or chip coverage. many of the americans who will shop have never had health insurance, so the process of selecting, implying, and in rolling will be unfamiliar to them. to reach these populations, cms is providing outreach, education, enrollment assistance in a variety of ways. in june, we relaunched a new consumer focus health care.gov website and a call center to help americans prepare for open enrollment and ultimately to sign up for private health insurance. since then, thousands of consumers have contacted us via the live web chat or our toll- free number.

healthcare.gov already has had over one million visitors. consumers in the marketplaces will also be able to get in person help from navigators, in person the sisters, trusting the people connected to their community who can help them walk through the process of applying for coverage. they can also work with insurance agents and brokers as is true in the market today. to select a qualified health plan. these insurance plans in the marketplace will be affordable. we are already seeing evidence that the marketplaces are encouraging ininsurers, having them compete on price. for the facilitated marketplaces, cms has gotten qualified submissions for more than 120 issuers. in many, some are lower than expected, 18% less than cbo estimates. in some cases, they are lower than the current premiums they are paying today. some have released initial bids only to have them request to amend them to make them lower in order to be more competitive.

this is good news for consumers. many of whom will be able to afford health insurance for the first time and many will be eligible for help with premiums nd out-of-pocket costs through advancement tax credits and cost-sharing reductions. cms has already finished developing most of the services for open enrollment including a routing tool to help verify status information that consumers provide against existing data sources. the marketplace will be up and running on october 1 when millions more americans will have access to high-quality, more affordable health coverage. by making coverage more affordable, improving the value of insurance coverage, protecting consumers, we are paving the way for fairer, more transparent, more accessible health insurance marketplaces. thank you for the opportunity to discuss the important work to improve access to affordable healthcare coverage for all americans and and they look forward to your questions.

>> you're recognized now for five minutes. >> chairman camp, ranking member levin, thank you for the opportunity to appear before you today to discuss the work the i.r.s. has been doing to fulfill our responsibilities under the affordable care act. the i.r.s. is charged with implementing the tax related provisions of the aca. our most substantial effort in this regard involves the delivery of premium tax credits that will help millions of tax -- american families afford health insurance starting in 2014 when the new health insurance marketplace, affordable insurance exchanges, ill begin operating. the department of health and human services is the lead defining the structure and agency on operations of the marketplace. open enrollment for insurance purchases will start october 1, 2013, with coverage beginning as soon as january 1, 2014. when an individual seeks to purchase insurance and seek financial assistance, the

marketplace must determine what assistance, if any, the applicants may qualify for such as medicaid or the premium tax credit. to make that determination, the marketplace will request federal taxpayer data from us and we will provide from each applicant some limited tax data from the applicant's most recently filed federal income tax return. it is important to understand exactly how this information will be transferred from the i.r.s. to the marketplace. the aca designates hhs as a conduit for information being shared with the marketplace. the taxpayer data supplied by the i.r.s. will be transmitted over secure encrypted channels to the hhs federal data services hub which was developed to facilitate these data transfers. this data hub will not be storing taxpayer information but merely routing the information to authorized users. at no time is the tax data to be

displayed to anyone outside of the marketplace itself. the i.r.s. sls responsible for providing a computational service if the marketplace determines that the applicant is eligible for and interested in advanced payments of the premium tax credit which are sent to the individual's insurance company. without identifying the applicant, the marketplace will submit a few data elements including income, family size for the competition will services for the hhs data hub and receive back a single igure. that figure will represent the maximum tax credit resulting from the data input. nothing in this computational process identifies individuals or contains tax data. the focus for october 2013 is on preparing for the marketplace to begin operating, the i.r.s. has been preparing for the 2015 filing season. beginning with 2014 tax returns

filed, eligible individuals will be able to claim the credit on their returns and will be required to reconcile any advances already paid to their insurance company on their behalf. in regards to these taxpayers, the i.r.s. must balance the need to promptly process accurate returns with the need to identify and stop any erroneous claims for the credit. to facilitate this process, the marketplaces will be sending to the i.r.s. enrollment information for individuals purchasing coverage through those marketplaces. this transactional information will be transmitted over secure encrypted channels and will include the cost of coverage and information on any advanced payments of the premium tax credit made during the coverage year to the taxpayer's insurance company on their behalf while certain identifying information, name and social security number, required to support the processing of returns, no personal health information will ever be provided.

the i.r.s. will reconcile the information for the report on the tax return so that thei.r.s. can verify whether they receive the proper amount of credit, our food more, or must repay any excess advance payment. this information will help the i.r.s. speed up the processing of returns and the spot erroneous claims. e i.r.s. already routinely sees third-party information to verify the accuracy and we have a long-standing policy in place related to the safety and privacy of this information. we will use this experience to guide us in making sure that any aca related taxpayer information we receive is properly safeguarded. in addition to the data, tools, and system thei.r.s. uses to battle tax fraud, we have some particular tools for enforcing proper payments at the premium tax credit. as mentioned above, the marketplaces will be providing the i.r.s. with key 2014

transactional data prior to the beginning of the 2015 tax filing system. having this pre-positioned enrollment data will allow the i.r.s. to more effectively detect erroneous claims for the credit. chairman camp, ranking member levin, that concludes my statement. i would be happy to take your questions. >> thank you both very much. as you know, the committee has long been concerned about the integrity of the use of taxpayer dollars and the i.r.s.'s ability to control abuse of those dollars. in fact, one of the treasuries' inspectors general, and that is obviously the independent nonpartisan watchdog of the i.r.s. and the treasury. it has previously been reported that there are massive amounts of improper payments and those are payments under the i.r.s.'s authority. reports last year by the nonpartisan inspector general

estimated that the i.r.s. will issue over $21 billion in fraudulent claims and more recently, the inspector general general found that the i.r.s. allowed $46 million in fraudulent tax refunds to go to a single mailing address in georgia. this comes on the heels of a 010 inspector general report so this is not a new development, that reported the i.r.s. would issue $55 billion to $65 billion before it could enact efforts to stop this fraud and these are efforts i have raised with your predecessor for a number of years as well. obviously, these facts are very troubling. that same nonpartisan inspector general testified, and i quote, the i.r.s.' existing protection systems may not be capable of identifying aca health care refund, or fraud schemes prior to the issuance of the tax refunds.

end quote. obviously, this is unacceptable. i guess i would ask, how do you expect the american people to believe that their hard-earned tax dollars are going to be protected? what are you doing about these long-standing and ongoing problems? the potential in the future given the inspector general's testimony. >> thank you for the question and i have a few responses. we could have a separate discussion about fraud and improper payments and other parts of the code like the arned income tax credit, but let me spend some time on the affordable care act. here are some differences with the way the i.r.s. footprint eitc.from the there are two key things i want to share with you. first, when an individual comes in to get premium tax credit assistance, no funds are shared

directly with the taxpayer. the money goes to the insurance company. that individual never received the money. they are getting an economic benefit, access to insurance, less expensive premiums, but different from the eitc. >> but whether they qualify for the benefit is up to them because the hhs said they will self verify. they will say whether they qualify. correct? >> as i mentioned in my opening remarks, we provide hhs and then they provide the marketplace taxpayer information about the income level. the information will validate what the income may be in the based on the historical information of what the taxpayer data says now. >> i am correct on the self verify that taxpayers will determine whether they qualify? >> i will leave that question for mr. cohen. >> mr. cohen, am i correct on that? >> no.

we will verify every person who applies for subsidies through the marketplaces and we will do that through -- >> stop. hhs announced that there is going to be a self verification system. did they not make that announcement? >> we're going to be coming out with additional guidance today today, i think, or tomorrow. >> they did make that announcement. >> we said we were going to be doing a sampling and we are going to announce that we are sampling 100%. we are going to be requesting documentation. >> so there is new information? can you elaborate? >> i can. the way it is going to work is people say this is how much my income was or is going to be. what the person puts on the application is checked against the available data sources from i.r.s., social security, disability income income, equus fax, a well-known -- >> you will not have the current taxpayer information until after they file. >> they are looking at the prior ear tax returns.

if we cannot match, if there is no match, if we cannot verify, we will ask for further information and documentation such as pay stubs from every applicant. >> one other thing i want to add. in addition to the taxpayer themselves not receiving funds, just the economic benefit, because the money goes directly to the insurance company. >> they do get the subsidy. >> yes, but they never get cash in hand. they get cheaper -- >> in terms of the american taxpayer being protected from in -- improper or fraudulent subsidies, that is an outstanding issue whether the individual gets a cash payment or not, there is still -- >> if there is a mistake there, it is a loss to the treasury. >> which is the american people. >> absolutely. i agree. if i could make one more point. the i.r.s. will have a report

from the exchange and it will have detailed information to let us validate if this individual has a relationship with the exchange and we will know whether they have made the premium payments. we will have more information to reconcile that individual's tax return than we have in other cases, so there are some mitigating elements that will help us reduce the incidence of potential erroneous cases. >> will the i.r.s. enforce the mandate that businesses offer acceptable coverage next year? >> here's how that's going to work. i think you're referring to that we have, in future years, after the 2015 filing, we rely on an employer report and it will not be provided in this first year. >> but next year. >> we are looking at other alternative reports and information to help validate the employer offer and that is under development right now with the employer community, the business community in light of the fact

that the employer report is not going to occur until filing season 2016. e are working with them now to look at alternative ways to validate the offer of coverage. >> did i not read the blog post properly that the mandate was delayed? >> it is the transition release period. >> that means it's delayed for one year. >> yes. >> an employer report due in filing season 2015 one now be due in 2016 but that does not mean we are not going to continue to work with businesses to understand what types of offerings -- >> but next year the employer mandate will not be enforced. >> that is correct. >> i do believe the i.r.s. will enforce the individual mandate that average americans have acceptable coverage next that correct? in ple.

>> one of the comments from the inspector general for tax administration said that tax returns accurately showe a above all they are treated fairly. i guess my question for you is,s are off the hook while the average taxpayer is going to be required to buy federally acceptable coverage thh an individual mandate? ow fair is that? >> my . is to implement the law. i rely on the treasury department to make certain decisions of a policy nature. i think the decision here in the issue of and equity, it's a policy called the treasury department made. there is a balancing that goes on in making sure we are implementing the law as effectively as possible. the employers and the business community reached out, indicating a need for more time. it was a balancing decision made that we should provide them the time.

>> thank you. i appreciate your openness about what hhs may be doing. it shows how important this is as we're seeing a new development every day in this area. any concern that this is unnecessary, i think those concerns are waved away by her -- your comments, but let me just say, you have seen the filings for the plans being offered in the 34 federal exchanges, have you not? >> we have had submissions from issuers that will be offering. >> they come to you because that is your responsibility. >> they have come to my office. >> we obviously have not seen them. the american people have not seen them. my question to you is will the average family in northern michigan see a $2500 reduction in the premiums that hey pay?

>> we haven't released any data on the rates that have come into the marketplace. we are very careful at c.m.s. we only release that information once we have an grem. we don't want to affect the market. >> the president promised, will lower premiums, up to $2,500 per typical family per year, is that going to happen? we're a couple of months away from this being implemented. is the average family in mid and northern michigan going to see that kind of rate reduction? >> i think that the average family in northern michigan will have in a marketplace more options and for better coverage at an affordable price once the affordable care act is -- >> so they will see a $2,500 reduction? >> i can't say. we're not releasing any information.

you can see why citizens are concerned. we don't have any predictions or terms on where this is going to be. >> i think that predictions have proven not to be very useful. i think it would be more useful to look at the rates that states have actually released, which in the -- >> but given the numbers you have seen, have you seen on verage a $2,500 reduction? >> yes. >> for the average family, you have seen a $2,500 reduction? >> that's what the president promised. >> well, i'm not sure that's exactly what the president said. >> i'm quoting from him. are you suggesting i'm not quoting him accurately? >> i am not suggesting that. i am just not sure what the president said.

>> here we go. the president talked about up to -- as long as you raised michigan, let me tell you what is happening. 14 insurance carriers have submitted to be participants now in the marketplace in michigan. 14. when blue cross blue shield has had had 57% a dominant role in insurance industry in michigan. the that is a fact. and for republicans who say ey believe in competition, essentially that is what this marketplace is going to bring about for the citizens of michigan, including central ichigan. >> if 209 is passed tomorrow and becomes law, would the

i.r.s. be able to implement the affordable care act? >> if my understanding of the law, we would not because we would not have the facility to extend resources to join the implementation effort. >> it will not happen. let me ask each of you if i might, will your agency be ready to go on october 1? >> yes, we will. >> we are assuming that 209 does not pass. >> yes, we will. >> will consumers be able to begin enrolling in the exchange october 1? >> yes, they will. >> will that coverage start on january 1 of 2014? >> yes, it will.

>> mr.werfel, there have been a lot of scare tactics about taxpayer data. let me read to you from your testimony. is that your insurance? >> yes. there is a set of procedures that we have put in place to make sure that there is clarity on when and how the taxpayer information is transmitted. it is transmitted over encrypted channels. there is all types of safeguards and procedures that we put in place when we share taxpayer information outside the i.r.s., which happens now for programs like medicaid and other programs. we are using those same sets of preemings which arefective. they are not pacific northwest but have proven historically her purposes.e in go -- if either of

you could comment how this bill would affect millions of middle- class individuals and families who have been waiting for premium assistance when the market lace opens on october 1? like to answer that? >> thank you. i would say in two ways. i think one very important way is today for anyone who has an illness or has had an illness in the past it can be difficult or impossible to get health because youverage would be ineligible or much too expensive