[House Hearing, 107 Congress]
[From the U.S. Government Publishing Office]
PRIORITIES OF THE U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES
REFLECTED IN THE FISCAL YEAR 2002 BUDGET
=======================================================================
HEARING
before the
SUBCOMMITTEE ON HEALTH
of the
COMMITTEE ON ENERGY AND COMMERCE
HOUSE OF REPRESENTATIVES
ONE HUNDRED SEVENTH CONGRESS
FIRST SESSION
__________
APRIL 26, 2001
__________
Serial No. 107-44
__________
Printed for the use of the Committee on Energy and Commerce
Available via the World Wide Web: http://www.access.gpo.gov/congress/
house
__________
U.S. GOVERNMENT PRINTING OFFICE
72-832 WASHINGTON : 2001
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------------------------------
COMMITTEE ON ENERGY AND COMMERCE
W.J. ``BILLY'' TAUZIN, Louisiana, Chairman
MICHAEL BILIRAKIS, Florida JOHN D. DINGELL, Michigan
JOE BARTON, Texas HENRY A. WAXMAN, California
FRED UPTON, Michigan EDWARD J. MARKEY, Massachusetts
CLIFF STEARNS, Florida RALPH M. HALL, Texas
PAUL E. GILLMOR, Ohio RICK BOUCHER, Virginia
JAMES C. GREENWOOD, Pennsylvania EDOLPHUS TOWNS, New York
CHRISTOPHER COX, California FRANK PALLONE, Jr., New Jersey
NATHAN DEAL, Georgia SHERROD BROWN, Ohio
STEVE LARGENT, Oklahoma BART GORDON, Tennessee
RICHARD BURR, North Carolina PETER DEUTSCH, Florida
ED WHITFIELD, Kentucky BOBBY L. RUSH, Illinois
GREG GANSKE, Iowa ANNA G. ESHOO, California
CHARLIE NORWOOD, Georgia BART STUPAK, Michigan
BARBARA CUBIN, Wyoming ELIOT L. ENGEL, New York
JOHN SHIMKUS, Illinois TOM SAWYER, Ohio
HEATHER WILSON, New Mexico ALBERT R. WYNN, Maryland
JOHN B. SHADEGG, Arizona GENE GREEN, Texas
CHARLES ``CHIP'' PICKERING, KAREN McCARTHY, Missouri
Mississippi TED STRICKLAND, Ohio
VITO FOSSELLA, New York DIANA DeGETTE, Colorado
ROY BLUNT, Missouri THOMAS M. BARRETT, Wisconsin
TOM DAVIS, Virginia BILL LUTHER, Minnesota
ED BRYANT, Tennessee LOIS CAPPS, California
ROBERT L. EHRLICH, Jr., Maryland MICHAEL F. DOYLE, Pennsylvania
STEVE BUYER, Indiana CHRISTOPHER JOHN, Louisiana
GEORGE RADANOVICH, California JANE HARMAN, California
CHARLES F. BASS, New Hampshire
JOSEPH R. PITTS, Pennsylvania
MARY BONO, California
GREG WALDEN, Oregon
LEE TERRY, Nebraska
David V. Marventano, Staff Director
James D. Barnette, General Counsel
Reid P.F. Stuntz, Minority Staff Director and Chief Counsel
______
Subcommittee on Health
MICHAEL BILIRAKIS, Florida, Chairman
JOE BARTON, Texas SHERROD BROWN, Ohio
FRED UPTON, Michigan HENRY A. WAXMAN, California
JAMES C. GREENWOOD, Pennsylvania TED STRICKLAND, Ohio
NATHAN DEAL, Georgia THOMAS M. BARRETT, Wisconsin
RICHARD BURR, North Carolina LOIS CAPPS, California
ED WHITFIELD, Kentucky RALPH M. HALL, Texas
GREG GANSKE, Iowa EDOLPHUS TOWNS, New York
CHARLIE NORWOOD, Georgia FRANK PALLONE, Jr., New Jersey
Vice Chairman PETER DEUTSCH, Florida
BARBARA CUBIN, Wyoming ANNA G. ESHOO, California
HEATHER WILSON, New Mexico BART STUPAK, Michigan
JOHN B. SHADEGG, Arizona ELIOT L. ENGEL, New York
CHARLES ``CHIP'' PICKERING, ALBERT R. WYNN, Maryland
Mississippi GENE GREEN, Texas
ED BRYANT, Tennessee JOHN D. DINGELL, Michigan,
ROBERT L. EHRLICH, Jr., Maryland (Ex Officio)
STEVE BUYER, Indiana
JOSEPH R. PITTS, Pennsylvania
W.J. ``BILLY'' TAUZIN, Louisiana
(Ex Officio)
(ii)
C O N T E N T S
__________
Page
Testimony of:
Thompson, Hon. Tommy G., Secretary, Department of Health and
Human Services............................................. 9
Material submitted for the record by:
Thompson, Hon. Tommy G., Secretary, Department of Health and
Human Services, responses for the record................... 68
(iii)
PRIORITIES OF THE U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES
REFLECTED IN THE FISCAL YEAR 2002 BUDGET
----------
THURSDAY, APRIL 26, 2001
House of Representatives,
Committee on Energy and Commerce,
Subcommittee on Health,
Washington, DC.
The subcommittee met, pursuant to notice, at 10 a.m., in
room 2322, Rayburn House Office Building, Hon. Michael
Bilirakis (chairman) presiding.
Members present: Representatives Bilirakis, Greenwood,
Burr, Whitfield, Ganske, Norwood, Shadegg, Bryant, Buyer,
Pitts, Brown, Waxman, Strickland, Barrett, Towns, Pallone,
Engel, Wynn, and Green.
Staff present: Marc Wheat, majority counsel; Kristi Gillis,
legislative clerk; John Ford, minority counsel; and Bridgett
Taylor, minority professional staff member.
Mr. Bilirakis. The hearing will come to order.
I am extremely pleased to welcome the Honorable Tommy
Thompson, Secretary of the U.S. Department of Health and Human
Services and, as we all know, the former Governor of Wisconsin
to testify before the subcommittee.
This, sir, is your first appearance before the Energy and
Commerce Committee as part of the new administration, and I
know all of us are delighted that you are able to take the time
out of your busy schedule to be here.
The purpose of today's hearing is to discuss the priorities
of the Department as they are reflected in the administration's
fiscal year 2002 budget request.
In addition, many members are interested in learning more
about a number of regulatory issues. To facilitate a dialog
with the Secretary, which Ranking Member Brown and I are both
anxious to do, I request unanimous consent that the opening
statements of all members, other than the chairman and ranking
member, be limited to 1 minute, with full statements submitted
for the record, of course.
The fiscal year 2002 budget delivers on President Bush's
vision for a responsible approach to improving the health and
well-being of all Americans. This budget includes $468.8
billion in total outlays, an 8.9 percent increase over fiscal
year 2001 spending. In particular, I am very pleased to see for
the first time in a long time an increase in the Health Care
Financing Administration's administrative budget.
The committee has communicated extensively with Secretary
Thompson about our Patients First project, which is intended to
help HCFA operate more efficiently and improve the quality of
care for parents; and I think we all agree that increased
administrative funding is a necessary step. We have all seen
that to be the case in our hearings, but it is only part of the
solution. I appreciate the Secretary's active input in our
Patients First initiative, and I know that we will benefit
greatly from his practical experience as a former Governor.
Finally, I would like to commend President Bush and
Secretary Thompson for recognizing Medicare reform and the
inclusion of a prescription drug benefit in the Medicare
program as a top priority. In addition to streamlining
burdensome and inflexible bureaucratic controls, we must act
now to protect and strengthen this vital program.
Mr. Secretary, the members of this committee and I look
forward to working closely with you and with President Bush to
enact broader reforms to preserve Medicare for the future while
improving the program by establishing a prescription drug
benefit.
I now yield to my good friend, Mr. Brown of Ohio.
Mr. Brown. Thank you, Mr. Chairman.
Welcome, Secretary Thompson. Your appointment to HHS was a
good one, and we are very glad that you are here with us and
look forward to working with you in the next few years.
You and I have spoken previously about a number of issues,
including the privacy rule and the importance of full funding
for Children's Hospital GME. Since that conversation, the
President has decided to move forward with the privacy rule and
the budget has been released with substantial but not full
funding for Children's Graduate Medical Education. These
outcomes are positive, even if we have some distance to go on
both issues.
The guidance that will be issued to clarify the privacy
rule is as important as the rule itself. I look forward to
working with you to make sure this guidance clears up any
confusion about the intent of the regulations, without
compromising the hard-fought protections established by the
rule.
Mr. Secretary, the Children's Hospital GME program should
be fully funded. We do not expect other teaching hospitals to
squeeze blood from a stone and self-fund graduate medical
education. We shouldn't expect children's hospitals, most of
which survive on far-from-generous Medicaid funding, to self-
finance the training of our pediatricians and pediatric
specialists.
Let me turn to Medicare. The President's budget diverts
$150 plus billion from the Medicare Trust Fund into
prescription drug assistance and Medicare reform. Prescription
drug assistance would take the form of block grants the States
do not want and stand-alone prescription drug plans the
insurance industry tells us they won't sell.
The Medicare reform proposal, although not specified in any
level of detail, appears to want to reform the program by
introducing more choice, also known as HMOs, into the program
while minimizing the role of traditional Medicare. The
President plans to deplete the Part A trust fund, even though
we know that the demands on that trust fund will increase at a
substantially greater rate than the fund itself, provide
nowhere near the funding necessary. Both parties agree to
establish meaningful prescription drug coverage for seniors,
and plans to overhaul traditional Medicare by making it one big
plus choice program, when our constituents tell us that it is
actually the plus choice part, not the traditional fee-for-
service part, that is not working.
I can see how the Medicare proposals accommodate the
President's tax cut and I can see how the Medicare proposals
benefit the insurance industry and the prescription drug
industry, but I can't for the life of me see how those
proposals protect Medicare, improve Medicare, or address a
single concern raised by beneficiaries and their families.
Again, these concerns overwhelmingly relate to the Medicare
managed care program, not to traditional Medicare, which is
working very well.
I want to switch gears for a moment and talk about HHS-
funded programs on food safety. Five thousand Americans die
each year from food-borne illnesses. Hundreds of thousands of
others are hospitalized. In addition to the well-known and
documented instances of food-borne illnesses, Americans need to
be concerned about antibiotic-resistant bacteria in food,
genetically modified organisms of unknown risk, and lethal
contaminants such as mad cow disease. Yet we inspect at our
borders only .7 of 1 percent of our food.
The modest increases in the President's budget barely skim
the surface of the problem, and even those dollars could easily
be diverted toward FDA's core drug approval activities. It has
unfortunately happened before. We need to do better with food
safety, with inspections. We can't do that, Mr. Secretary,
without your active participation and leadership; and we look
forward to that.
Thank you.
Mr. Bilirakis. I thank the gentleman. Now the Chair
recognizes the vice chairman of the subcommittee, Dr. Norwood.
Mr. Norwood. Thank you very much, Mr. Chairman.
Mr. Secretary, we welcome you today. I think I congratulate
you on your appointment. I believe that you perhaps have one of
the most difficult agencies out there to deal with, and I also
believe that you are the man for the job that can straighten it
out.
I am one of those people that happen to believe that the
President, the CEO of our country, is very correct in trying to
make certain that we limit the amount of increase in spending
every year; and I am one of those people who believes that,
even though many problems and many things need to be changed--
for example, in Medicare, in managed care, at HCFA, et cetera--
not always the solution is throwing dollars at it. Sometimes we
may just want to try to do things right and be a little more
efficient, and I believe that you are the man for that job.
I am pleased about your passions that you bring to
Washington and bring to HHS, for example, in your deep interest
in organ transplants and in other areas. That is the kind of
Secretary I would like for us to have, not someone who just
pushes numbers around but one that really believes in this
issue. So I very much look forward to working with you, and I
know we are going to do some great things in many areas, and I
thank you, sir.
I yield back.
Mr. Bilirakis. I thank the gentleman.
Mr. Pallone, for a brief opening statement.
Mr. Pallone. Thank you, Mr. Chairman, for holding this
hearing.
The President, Mr. Chairman, in my opinion should be
fighting for health priorities that protect Medicare, provide a
meaningful Medicare prescription drug benefit and ensure
funding for public health programs that provide care to those
who cannot afford it. After reviewing the HHS budget
priorities, it is clear to me that just the opposite will be
accomplished. That is, the budget will spend the Medicare
surplus on other priorities, the budget will fail to provide a
meaningful prescription drug benefit, and the budget will cut
important safety net programs and public health programs that
provide care to the underserved population.
It is particularly alarming that President Bush's tax cut
forces him to use the Medicare surplus to fund other spending
initiatives. The budget includes the Medicare surplus in an
$842 billion contingency fund that will be used for defense,
education, agriculture and debt reduction. It is estimated that
the contingency fund will be quickly depleted, therefore
leaving the Medicare trust fund surplus vulnerable to being
used for other priorities. From my understanding, even
Secretary Thompson agrees that the budget fails to protect the
Medicare trust fund.
The government is in a unique financial position to make
necessary changes to Medicare and to add necessary health
services to those who lack resources. This is not the time to
funnel Federal dollars that can be used for health priorities
to instead fund a tax cut plan that costs over $2 trillion
ultimately.
I want to thank you again, Mr. Chairman, for holding this
hearing; and I am interested in hearing from the Secretary on
the budget and look forward to opportunities to ask questions.
Mr. Bilirakis. I thank the gentleman.
The Chair now recognizes Dr. Ganske and would also report
that a vote is being expected in the next 3 or 4 minutes
downstairs on the telecom bill, so some of us will be getting
up and jumping down for that.
Mr. Ganske. Thank you, Mr. Chairman. I thought you were
saying a vote on the floor was going to occur and giving me a
hint to be brief. I will be brief.
Welcome, Mr. Secretary, a fellow Midwesterner, somebody who
has been intimately involved with Department of Health and
Human Services issues for a long, long time, very knowledgeable
on these issues and I think a great appointment by President
Bush for this slot. And thank you for your public service
throughout the years and particularly now in this difficult
job.
There are so many things to talk about. I don't know how
much time you will have with us today. We could talk about
implementation of patient rights as they relate to Medicare.
There are important public health issues like tobacco and the
role of the FDA, which you have spoken about to some extent.
Prescription drug benefit will, I am sure, come up. I would
like at some time to talk to you about how we can improve the
reimportation of prescription drugs which Congress worked on.
The big issue is the solvency of Medicare in the long term.
But as it relates to Medicare there is one issue that you, as a
former Midwestern Governor, and I, as a representative of Iowa,
think a lot about and that is that rural States have not
received a fair reimbursement proportion. Nationally, Iowa
ranks about 25th in terms of overhead expenses and yet we are
dead last, right at the bottom, 50th in terms of Medicare
reimbursement. That is not fair, and I think we need to do
something about it. I know that you have taken an interest in
that, and I look forward to your testimony.
Mr. Bilirakis. Mr. Towns, for an opening statement. We have
had unanimous consent to limit our opening statements to 1
minute. But obviously if we can stay as close to it as
possible, that would be appreciated.
Mr. Towns. Fifty-five seconds, Mr. Chairman.
Mr. Secretary, let me congratulate you again. I was pleased
to see in your testimony that you will attempt to streamline
antiquated systems at HCFA. I hope that under your watch you
will also reduce some of the burdensome and unnecessary
regulations from HCFA.
Let me briefly describe one such unnecessary regulation
that is affecting the seniors in my district.
On January 10, 2001, HCFA issued approval of the Home
Health Advance Beneficiary Notice and required all home health
agencies to give this form to all of their duly eligible
patients by March 1 of this year. This form is on the top of
multiple other written notices home health agencies are
required to provide to patients under their care.
While this form is an improvement over earlier versions, it
still does not allow HHA to inform duly eligible patients that,
if Medicare will not cover their services, Medicaid has covered
them in the past and is likely to continue to cover them in the
future. Instead, the form provides only three options, all of
them informing the patient that Medicare will either reduce,
limit, or deny coverage for the relevant home health service.
This frightens the patients and family members often to the
point where they will refuse the home health care they
desperately need in order to avoid getting stuck paying for a
bill that the home health agency knows is covered.
Mr. Secretary, if we can put a man or a woman on the moon,
surely this country can devise a home health care form which
will permit low-income seniors to receive the care they
desperately need. I urge you, Mr. Secretary, as part of the
planned HCFA reforms, to simply add a third option in this form
which will permit Medicaid to be properly billed for home
health service.
I look forward to working with you in the days and months
ahead. Thank you very much.
Mr. Norwood [presiding]. Ladies and gentlemen, the
committee chairman has asked that we hold to 1 minute in order
to give the Secretary as much time as possible; and though I am
uncomfortable interrupting you, I am going to at 1 minute. So
please limit your remarks to 1 minute.
Mr. Bryant.
Mr. Bryant. Thank you, Mr. Chairman.
I, too, want to add my welcome to you and tell you that I
am personally very pleased that you are in the position that
you are in. In the interest of saving time, I will adopt the
statements of my colleagues on this side of the aisle and would
yield back the balance of my time.
Mr. Norwood. Thank you, sir.
Now we will hear from Mr. Green.
Mr. Green. Thank you, Mr. Chairman. I know we are eager to
hear from Secretary Thompson, so I will keep my remarks short.
I have a much longer statement that I will submit for the
record.
Welcome, Mr. Secretary. Mr. Chairman, the services provided
by HHS have a direct benefit and touch the lives of more
Americans than any other agency. From the life-saving research
performed at the NIH to the vital assistance provided by the
LIHEAP program, this agency has vast and critical
responsibilities. It is essential that we provide HHS with the
resources it needs to perform those duties.
While the President has made investments in some programs
such as NIH and community health centers, he eliminates or cuts
or provides insufficient funds for others. I am especially
concerned about elimination of the Community Access Program,
cuts to the Pediatric Graduate Medical Education Program, and
also reductions in the CDC's Chronic Disease Program. These
programs are critical to our fight to provide health care to
the Nation's 43 million uninsured and our battles against
chronic disease and the training of pediatricians and pediatric
specialists. I look forward, Mr. Secretary, to hearing you
today and look forward to working with you and also to discuss
some of these particular programs that we have.
I yield back my time. How long was that, Mr. Chairman?
Mr. Norwood. One minute and 5 seconds.
Mr. Green. I thought I was going to do it in 59 seconds.
Mr. Norwood. You did pretty good.
Mr. Buyer for 1 minute.
Mr. Buyer. Mr. Secretary, I also welcome you here today and
let you know that I come from a rural district in Indiana, and
I want to make sure that the American rural areas, their
medical needs and health needs are also met so we will make
sure that we have equity in our systems. Out there in those
rural areas reimbursement for ambulance rates are very
important to make sure that we can get these patients to those
health centers.
The other thing I would just throw out on the table to you,
as you hear Mediscare, and that is what we have heard from some
statements here today, I would like to remind you that it was
back in 1995, when Republicans took control of Congress, in the
face of bankruptcy, we worked with President Clinton. We did
not get support from those who were the advocates of universal
health care or government controlled health care. But when we
moved forward to save Medicare from bankruptcy, that didn't
mean that we got it all right. So we have to be very attentive
in that process, and we want to work with you and especially on
the Medicare prescription drug program.
Mr. Norwood. Mr. Strickland, I know that 1 minute is not
enough, but you are recognized for 1 minute.
Mr. Strickland. Thank you, my friend.
Thank you, Mr. Secretary, for being here.
I note that the Community Access Program--which is a
program that helps rural areas in particular because it helps
community providers provide greater services for the
uninsured--has been eliminated to the tune of $125 million. The
Health Resources Service Administration facilities program
eliminated, some $251 million. The Bureau of Health Professions
has been cut by $213 million, and this program helps train
professionals to serve in medically underserved communities.
Rural health and telehealth cut by $58 million, and SAMSHA's
mental health programs cut by $16 million.
I just point these out because I am from an Appalachian
area, a very poor area, and I think these programs are very
vital to a region like mine and many others across the country.
So I am glad you are here today. I look forward to your
testimony, and I hope you can speak to some of these issues.
How did I do?
Mr. Norwood. You did absolutely great. You gave Mr. Waxman
an extra 10 seconds.
I now recognize the vice chairman of the full Commerce
Committee, Mr. Burr, for 49 seconds.
Mr. Burr. Thank you, Mr. Chairman.
Welcome, Mr. Secretary. There still are some people in this
Congress that believe that if you just pump more money at
something you get a different result. If we have learned
anything over the last 6 years, it is that there are many areas
of your responsibility that require structural and cultural
change, the type of change that can only happen with a
bipartisan effort of Congress with the commitment from HHS.
I want to commend you as you have begun to assemble a staff
to work under you. You not only have chosen capable but you
have chosen experienced individuals to head up many of the
issues that we are going to deal with between this committee
and your agency. I know today that we can reach solutions to
these problems if the commitment is as strong on our side as I
am sure it will be from you. I thank you once again.
Mr. Norwood. I thank the vice chairman for being exactly
perfect on time.
Mr. Waxman, I am delighted to give you 1 minute, sir.
Mr. Waxman. Thank you, Mr. Chairman.
Mr. Secretary, I welcome to you our committee. Your
Department has jurisdiction over health care for Americans,
whether it is Medicare or Medicaid, the CHIP program, and all
of the activities of the FDA and prevention programs and family
planning and on and on and on. Those are within the
jurisdiction of our committee, and we want to work with you in
these efforts. We want to be cooperative to assure your
Department has the resources it needs to do the job that people
are depending on you to do.
But, in that vein, I want us to not give away in tax cuts
for the wealthy the financial resources we must have to meet
the needs of those who depend on Medicare or Medicaid, or on
the Ryan White programs for persons with AIDS, or on training
funds for nurses and medical personnel; on a strong and
effective FDA, or on services for severely disabled children or
legal immigrant children, to name only a few. Because the fact
is when we endanger the surplus and take away available
resources with massive tax cuts, particularly for the wealthy
who do not need it, it is at the expense of those people who
depend on the programs in your Department; and they are the
ones who will suffer.
I look forward to your testimony today and working with you
in the future. Thank you.
Mr. Norwood. Now, we would like to recognize the
Pennsylvania delegation. First, Mr. Greenwood for 1 minute.
Mr. Greenwood. Thank you, Mr. Chairman.
Mr. Secretary, it was good to meet with you in my office
yesterday. I am very excited about your stewardship of the
Department. I think your notion of going from agency to agency,
actually running your office out of those agencies and running
those agencies yourself is spectacular.
In 1 minute, I could list a few of the things that I looked
forward to working with you on: Title 10, medical records,
privacy, HCFA reform, FDA reform, organ transplants, computer
security, clinical research, chimpanzee retirement, average
wholesale price of drugs, AIDS, NIH, and cloning and a few
other things. I look forward to your comments.
I yield back the balance of my time.
Mr. Norwood. Mr. Pitts of Pennsylvania, you are allowed 1
minute.
Mr. Pitts. Thank you, Mr. Chairman. I am pleased that you
are holding this important hearing today. And, Mr. Secretary,
thank you for taking time to be with us to discuss the budget
of one of the Nation's most important domestic spending
programs.
I look forward to working with you on a number of issues,
as we face even some issues of controversy as well as
importance. Some of these would include funding for community
health centers; the CDC practice of blind HIV testing;
abstinence funding; the abortion drug, RU 486, making sure that
it does not endanger the health of women; alternatives to
embryonic stem cell research; oversight of the Title 10 program
and others.
I look forward to hearing your testimony, and I thank you
for coming.
Mr. Norwood. I remind all of my colleagues that all of us
had a lot more that we would like to say than 1 minute and you
are more than welcome to submit for the record your written
testimony. But the purpose of this hearing is to hear from the
Secretary.
[Additional statement submitted for the record follows:]
Prepared Statement of Hon. Eliot L. Engel, a Representative in Congress
from the State of New York
Mr. Chairman, first let me say that I am pleased to be here today
and I welcome you Mr. Secretary and look forward to your testimony and
the opportunity to discuss some of the specific provisions of the
Department of Health and Human Services' (HHS) budget.
When the President proposed tax cuts totaling over $2 trillion I
was extremely concerned about what programs would be cut or eliminated
in order to pay for such a large proposal and how the cuts would affect
American families. It seems that for health care especially, the cuts
are deep and will have a terrible impact on our country's health care
safety net. The budget talks about replacing the State Children's
Health Insurance Program (S-CHIP) with private health insurance through
the use of tax credits. In addition, the Community Access Program is
eliminated, while Ryan White and Healthy Start funding levels are
frozen. Many of the cuts are in programs that assist families in New
York and across the country in obtaining basic health services and
should not suffer at the hand of a huge tax cut that for the most part
will go to a very few wealthy people at the top of the income ladder.
These are only a few examples of the types of programs that this
budget hits hard. Also, the President's effort to provide seniors with
a Medicare prescription drug benefit appears vastly inadequate. In
fact, the budget only sets aside $153 billion over ten years for a
prescription drug benefit and Medicare reform and siphons money out of
the Medicare Part A trust fund, thus bringing Medicare closer to
insolvency. Congress must act to provide a real benefit for seniors and
must pay for it with resources outside of Medicare to ensure the
solvency of the program.
Mr. Chairman, I hope that we can examine some of these provisions
and realize that we in Congress cannot go along with this budget. I
look forward to working with my colleagues to bring about substantial
changes so that we can continue the work we have done in Congress on
behalf of American families.
Mr. Norwood. With that, Secretary Thompson, you have the
floor.
STATEMENT OF HON. TOMMY G. THOMPSON, SECRETARY, DEPARTMENT OF
HEALTH AND HUMAN SERVICES
Mr. Thompson. Thank you very much, Acting Chairman Norwood.
It is a privilege for me to be in front of this wonderful
committee, and I want to thank Chairman Bilirakis for
scheduling it and also Congressman Brown and all the other
members.
Let me just start out by saying that, like all of you, I
believe very passionately in the Department of Health and Human
Services, our mission and what we can do together on a
bipartisan basis. I am looking forward for your advice and your
criticisms--constructive criticisms and your support to
accomplish the objectives set out by the mandates that you have
set in statute, and I am looking forward to working with you.
I am honored to appear before you today to discuss the
President's fiscal year 2002 budget for the Department of
Health and Human Services. Much has been written and said about
selective portions of our budget and some unfair and some
inaccurate charges have been leveled against it. That is why I
am very pleased today to have this opportunity to appear in
front of you to discuss our detailed budget proposal. I am very
confident that a review of the full details of our budget will
demonstrate that we are proposing a very balanced, responsible
approach to building a strong and healthy America.
The budget before you today keeps the promises that the
President of the United States has made and proposes new and
innovative solutions for meeting the challenges that face our
Nation. Our proposal begins the modernization and the
strengthening of Medicare. It expands access to health care,
reforms the way the Department operations are managed.
Mr. Chairman and members, the total HHS request for fiscal
year 2002 is $468 billion. The discretionary component totals
$55.5 billion, or a 5.1 percent increase.
I would like to begin today by talking about Medicare, the
cornerstone of our health care system. It provides coverage to
40 million Americans, and it is the largest health insurer in
the Nation. All of us, you on the committee and me at the
Department and all the other residents of America, are paying
our taxes into this system; and they are supporting it not only
for today's beneficiaries but in the full faith and expectation
that this program will be there when we need it and when our
children need it, delivering health care at a price that we all
can afford.
Costs for all of Medicare will quadruple, growing from 2.2
percent of the gross domestic product today to 8.5 percent. At
the same time, revenues only grow from 2.4 percent of GDP today
to 5.3 percent. That is a big gap.
What does that mean for America? Precisely why we must act
now to modernize, strengthen and protect this popular and vital
program and, yes, add a prescription drug benefit.
Modernizing Medicare is just one part of President Bush's
initiatives to strengthen the health care safety net for those
most in need, notably, the 43 million Americans who do not have
health insurance.
Among the President's top priorities is to increase funding
for community health centers, which provide high-quality,
community-based care to approximately 11 million patients, 4.4
million of whom are uninsured, through a network of more than
3,000 centers in rural and urban areas. The President has
proposed to expand and increase the number of health centers by
1,200 by 2006 and increase the number of patients being seen by
11 million to 20 million.
As a first installment of this multiyear initiative, we
propose to increase the funding for community health centers by
$124 million. We also will be looking at ways to reform the
National Health Service Corps so as to better target placement
of providers in areas that experience the greatest shortage of
health care professionals, a lot of those in rural areas.
We are also acting to address the nursing shortage in
America by increasing fundings for nursing professional
programs to $82 million for fiscal year 2002, which is a 7
percent increase.
And you cannot talk about health care in America without
talking about improving women's health. This administration
recognizes the vital role that women play in the health of
their families. Therefore, we are increasing funding for the
Office of Women's Health by $10 million to $27 million because
we recognize that healthy women mean healthy families.
This administration also is committed to giving States
greater flexibility in managing their health programs. Our
budget proposes to give States expanding authority to transfer
funds among public health grants, thereby enabling them to make
more efficient and inventive use of Federal resources and to
target and reallocate funds to public health priorities,
identified at the State and local levels.
To that end, we are investing in modernizing and increasing
the efficiency of the Health Care Financing Administration. I
know that this committee is keenly interested in HCFA, and many
of you recently visited and visited its office. I commend the
members of this committee for taking such a very active
interest, and I want to work with you to improve it.
I have also been up to visit HCFA, and I saw an agency
strapped with excess regulations and responsibilities without
actually receiving the resources necessary in order for it to
do its job effectively. It is clear that HCFA offices were
filled with hundreds of dedicated employees but also with
outdated computers and a bookkeeping system that is absolutely
arcane and demands that have spread the agency too thin for too
long. HCFA needs our help now so it will be able to help,
Congressman Towns, your people and other people across America.
To help HCFA begin to meet these challenges, the budget
proposed an increase of $192 million, or 9 percent, to be able
to manage HCFA in its programs and modernize so it can do the
job properly. We are going to dedicate $36 million to update
antiquated information technology systems; and we are working
to ensures HCFA is more responsive, efficient, pleasant, and
flexible in dealing with States and health care providers in
daily operations.
We are also going the Department a step further. Next week,
on Monday morning, I will be moving the Secretary's office from
the Humphrey Building to Baltimore to run HCFA for a week
personally to see how it truly operates, what it does well and
what can be done better. This firsthand experience undoubtedly
will help me learn how we can operate HCFA better so that it is
more responsive to your constituents that HCFA was set up to
serve.
I know some of you have experienced concerns in your
speeches this morning about various decisions in the
Department's budget: child care, AIDS, and providing care for
the uninsured. I am here today to assure you that these are top
priorities for this administration and for me and the total
Department of Health and Human Services.
I would also urge to you look at the budget as a whole and
not just individual lines and individual agencies. Look at
issues as a whole and you will see that we will have better
collaboration among agencies within the Department to make a
concerted effort on an array of issues that can better serve
all Americans.
President Bush recognizes the importance of investing in
our children, and the HHS budget reflects that commitment. The
budget includes increases for both existing programs as well as
new investments in a number of new programs designed to fulfill
President Bush's commitment to making sure that no child is
left behind. One of the most important things that we as a
government can do is to help working families, especially those
trying to move from dependency to the workforce, is to assist
them in obtaining child care. The President requested a total
of $2.2 billion for the child care and development block grant,
which is a discretionary pot, a 10 percent increase, and
coupled with an additional $150 million increase for the
mandatory portion of child care. We will be increasing spending
on child care, therefore, over last fiscal year by $350
million.
To further strengthen American families, President Bush has
proposed ambitious initiatives to promote stable families and
responsible fatherhood, paternity group homes, a compassionate
capital fund and a proposal to establish a center for faith-
based and community initiatives within the Department.
We also will be increasing funding for substance abuse
through SAMHSA by $100 million.
This administration also, ladies and gentlemen, remains
committed to fighting AIDS, both at home and, yes, abroad,
which is a serious problem. This budget includes $10.2 billion
for the HIV/AIDS program, a 7.2 percent increase for research,
treatment, and prevention. It also includes an additional 11
percent increase for international AIDS spending.
Along these same lines, the Department of Health and Human
Services is joining with the State Department to develop a task
force headed up by Colin Powell and myself at the request of
the President to provide real leadership in the fight against
HIV/AIDS, both domestically and internationally, and looking at
trying to come up with a total plan, especially in the
continent of Africa. The President, Secretary Powell, and I are
committed to fight this disease on all fronts.
A top priority for this administration, of course, is
ensuring that the National Institutes of Health continue to
have the resources necessary to help turn these promises into a
reality. The research that is conducted and supported by the
NIH is absolutely phenomenal, from most basic research in
biological systems to the effort to map the human genome,
offers the promise of breakthroughs in prevention and treating
diseases from cancer to Parkinson's to Alzheimer's.
The potential that lies in these projects is why President
Bush's plan to double the resources for the NIH by 2003 is so
vital. The $2.75 billion increase in this budget is the largest
1-year increase ever for NIH, and it will support 34,000
research grants, most of those in the States that you
represent. This happens to be the most in the agency's history.
The President has also included $208 million for asthma
research at NIH, a 12 percent increase, and $768 million for
diabetes research, a 11.3 percent increase. We are committed to
fighting two of our most prevalent and chronic conditions in
America.
Finally, Mr. Chairman, I would also like to commend you
personally for your work that is particularly close and near to
my heart, organ donation. Your Organ Donation Improvement Act
is a strong step in the right direction in helping America
increase the number of organs donated, and it will work hand in
hand with the five-point organ donation initiative that we
unveiled earlier this month at the Department of Health and
Human Services.
The President also has proposed a 33 percent increase for
organ transplantation programs at the Health Resources and
Service Administration; and we must continue to fight to try to
cut into the waiting list of 76,000 Americans who need an
organ, an increase of 300 each and every month. It is time that
it is brought to the forefront of our health care agenda, and I
look forward to working with each of you in the future.
Mr. Chairman, I have talked about a few of the dozens and
dozens of exciting initiatives in President Bush's budget for
the Department of Health and Human Services. A more detailed
list is included in the written testimony that I submitted
earlier. The common thread, however, that binds all of our
proposals together, and which binds together the bipartisanship
of this committee, is the desire to build a strong and a
healthy America and to improve the lives of all of our
citizens.
I am prepared to work with each of you to ensure that we
develop a budget for this Department that effectively serves
the national interests.
Now I would be happy to address any questions that you may
have.
[The prepared statement of Hon. Tommy G. Thompson follows:]
Prepared Statement of Hon. Tommy G. Thompson, Secretary, Department of
Health and Human Services
Good Morning, Chairman Bilirakis, Congressman Brown, and members of
the Subcommittee. I am honored to appear before you today to discuss
the President's FY 2002 budget for the Department of Health and Human
Services. I am confident that a review of our budget for these programs
will demonstrate that we are proposing a balanced, responsible approach
to building a strong and healthy America.
Part of this approach means we must no longer be content to do
things a certain way because ``that's how we've always done it''. It
means we must be willing to reform our business practices and seek
innovative ways to manage our programs. And, while we know that the
federal government has an important role to play, we must also
recognize that our State, local and tribal government partners,
community and faith-based organizations, the private sector and
academic institutions--all are indispensable sources of new and
creative approaches to solving public problems. The President and I
share this view, and I am proud to say it is manifested in the budget
he has put forward.
The President's budget proposes innovative solutions for meeting
the challenges that face the nation. Our proposal begins the
modernization of Medicare; expands access to health care; enhances the
groundbreaking research being sponsored by the National Institutes of
Health; protects public health; and, invests in infrastructure and
reforms the way the Department's operations are managed. The HHS budget
also reflects the President's commitment to a balanced fiscal framework
that puts discretionary spending on a more reasonable and sustainable
growth path; protects Social Security, Medicare, and other priority
programs; continues to pay down the national debt; and provides tax
relief for all Americans. Let me now highlight some priorities in the
HHS budget.
enhancing scientific and health care quality research
Advances in scientific knowledge have provided the foundation for
improvements in public health and have led to enhanced health and
quality of life for all Americans. Our FY 2002 budget enhances support
for scientific research as well as for research to improve the quality
of the Nation's health care system.
Biomedical Research Sponsored by the National Institutes of Health
The National Institutes of Health (NIH) is the largest and most
distinguished biomedical research organization in the world. The
research that is conducted and supported by the NIH, from the most
basic research on biological systems to the successful mapping of the
human genome, offers the promise of breakthroughs in preventing and
treating any number of diseases. A top priority for this Administration
is ensuring that the NIH continues to have the resources necessary to
help turn these promises into a reality.
This budget keeps the President's commitment to double NIH's FY
1998 funding level by FY 2003. For FY 2002, we are proposing an
increase of $2.75 billion, which will be the largest dollar increase
ever for NIH. This funding level will enable NIH to support over 34,000
research project grants, the highest level in the agency's history. NIH
will expand its focus on four research areas that show the greatest
potential for yielding new scientific breakthroughs: genetic medicine,
clinical research, interdisciplinary research, and health disparities.
With any large increase in resources, there also comes the
increased challenge of making sure that those resources are managed
properly. I take this responsibility very seriously, and NIH will work
to develop strategies to ensure that we are managing taxpayer dollars
in the most effective way in setting research priorities.
IMPROVING MEDICARE
Of all the issues confronting this Department, none has a more
direct effect on the well-being of our citizens than the quality of
health care. Our budget proposes to improve the health of the American
people by taking important steps to improve Medicare, including the
addition of a prescription drug benefit, and by directing funds to
various initiatives aimed at directing funds to initiatives aimed at
expanding access to health care.
Modernizing Medicare and Immediate Helping Hand
The Medicare program has been the center of our society's
commitment for ensuring that all of our seniors enjoy a healthy and
secure retirement. Honoring this commitment means making sure that the
program is financially prepared for new beneficiaries, and ensuring
that current beneficiaries have access to the highest quality care. One
clear example of our need to renew Medicare's promise is the lack of
adequate prescription drug coverage. When Medicare was created in 1965,
prescription drugs were not an integral part of health care as they are
today and coverage was not included as part of the Medicare benefit
package. But what was acceptable thirty-five years ago is simply
unacceptable today.
We have already waited too long to address this problem. The
President has put forward our Immediate Helping Hand proposal as an
interim measure to do so. Our proposal provides $46 billion over five
years to help States so that they can provide prescription drug
coverage to beneficiaries with limited incomes or high drug expenses;
and it will provide immediate coverage for up to 9.5 million
beneficiaries.
Almost half the states currently have prescription drug assistance
programs of some kind, and most of the other states are considering
such programs. With modifications, these programs would be eligible for
IHH grants. The IHH would be fully funded by the Federal government and
would provide States with the flexibility to choose how to establish
coverage or enhance existing plans. Individuals with incomes up to
$11,600 and married couples with incomes up to $15,700 who are not
eligible for Medicaid or a comprehensive private retiree benefit would
pay no premium and no more than a nominal charge for prescriptions.
Individuals with incomes up to $15,000 and married couples with incomes
up to $20,300 would receive subsidies for at least half the cost of the
premium for high-quality drug coverage. The IHH plan also includes a
catastrophic component that would cover any Medicare beneficiary with
very high out-of-pocket drug costs.
The President's Immediate Helping Hand proposal is a temporary plan
to help our Nation's seniors who are most in need of assistance with
their prescription drug costs. The benefit will sunset in December
2004, or as legislation to strengthen Medicare including a prescription
drug benefit is implemented. However, this plan is critical because it
provides assistance to millions of Americans immediately. The President
and I want to work closely with Congress in a bipartisan fashion to see
this happen.
We also believe, along with many Members of Congress who have
supported and continue to support bipartisan efforts to strengthen
Medicare, that we must take steps to improve Medicare as soon as
possible. Inadequate prescription drug coverage is only the most
obvious gap in Medicare benefits. Today, Medicare covers 55 percent of
the average senior's annual medical expenses, and the options available
to seniors to help them limit these expenditures are declining.
Moreover, the program faces a looming fiscal crisis. A full assessment
of the health of both the Part A and Part B Trust Funds reveals that
current spending exceeds the total of tax receipts and premiums
dedicated to Medicare and that this financing gap is expected to widen
dramatically. Even without a financing problem, Medicare modernization
would be necessary to ensure that beneficiaries continue to get high
quality health care. President Bush proposes to devote $156 billion
(including funding for Immediate Helping Hand) over the next ten years
to a set of improvements in Medicare that are urgently needed. These
Medicare modernizations should include taking steps to make better
coverage options available, to assure that all seniors have affordable
access to prescription drugs, to provide better coverage for high out
of pocket expenses, particularly low-income seniors, and to ensure that
Medicare has greater overall financial security.
INVESTING IN INFRASTRUCTURE AND REFORMING MANAGEMENT
For any organization to succeed, it must never stop asking how it
can do things better. I am committed to seeking new and innovative ways
to improve the management of HCFA and all our programs at HHS. But we
must also recognize that we do a disservice to all who rely on this
Department if we do not provide the resources necessary to effectively
administer our programs. In preparing our budget, we began the process
of evaluating the programs and business practices of this Department
and identifying the areas where we can do a better job of managing
taxpayer resources, as well as those areas where new investments are
required if we are to successfully administer our operations.
HCFA Management Reform
One of the most important management reforms we will pursue is the
improvement of the Health Care Financing Administration (HCFA). We have
all heard the complaints by patients, providers, and States about the
scope and complexity of the regulations and paperwork that govern the
Medicare, Medicaid, and State Children's Health Insurance programs.
And, in many cases, these complaints are valid.. But in its defense,
HCFA has been tasked with implementing several pieces of major
legislation and its responsibilities have grown more complex with each
new major health care law or budget reconciliation.
Concerns about HCFA's management capabilities have been raised in
several General Accounting Office reports, including the High Risk
Series: An Update (January 2001) and Financial Management: Billion in
Improper Payments Continue to Require Attention (October 2000). HCFA
management reform is an Administration priority. HCFA will undertake a
major effort to modernize and streamline its operations to effectively
manage current programs and implement new legislation. In particular,
HCFA's role in a modernized Medicare program needs to be carefully
considered. This may require substantial changes in HCFA's mission and
structure. My goal is to assure that HCFA's resources are focused as
effectively as possible on improving quality and limiting costs for
Medicare beneficiaries, limiting burdens for providers, and increasing
efficiency for taxpayers.
The budget proposes an increase of $109 million, or 5 percent, for
HCFA program management. Included in this budget is a $53 million,
increase of $36 million over this year, to support the development of
the HCFA Integrated General Ledger Accounting System (HIGLAS). HCFA
currently relies on several financial management systems to account for
the hundreds of billions of dollars spent on Medicare benefits, and
most contractors do not use double entry accounting methods or claims
processing systems with general ledger capabilities. This system
requires financial statements to be imputted manually, increasing the
risk of administrative and operational errors and misstatements. The
new system will provide a uniform Medicare accounting system that will
help HCFA detect and collect money owed to the Medicare Trust Funds,
retain a clean opinion on financial statements without more expensive,
alternative efforts, and comply with financial management statutory
requirements.
Contracting Reform
I am also committed to reforming HCFA's antiquated and inefficient
contracting system. We are considering a number of options in this area
including: allowing carriers who are not health insurance organizations
to become Medicare contractors; allowing the Secretary (as opposed to
the Part A provider) to contract for and assign fiscal intermediaries
to perform claims processing, claims payment, communications, audit
functions, renewing contracts, and transferring functions; and
replacing current special provisions for terminating contracts with
more standard terms and conditions embodied in the Federal Acquisition
Regulation (FAR). In addition, I am including in the budget $115
million in new proposed user fees for duplicate and paper claims
processing. We will work hard to enact these fees, which will help to
improve the efficiency and lower the cost of processing Medicare
claims.
Revitalizing Laboratories and Scientific Facilities
There are other investments that are just as important as HCFA
reforms. For example, it is critical that we invest in the
modernization of our laboratories and scientific facilities, for
obsolete facilities affect our scientific readiness and compromise our
ability to retain the top scientists. Our budget includes funds to
continue the revitalization of key facilities at the Centers for
Disease Control and Prevention and the National Institutes of Health.
We are requesting $150 million for buildings and facilities at the
Centers for Disease Control and Prevention, which will support
construction of a laboratory facility dedicated to handling the most
highly infectious pathogens, such as Ebola, and construction of an
Environmental Toxicology Lab. The budget also requests $307 million for
intramural buildings and facilities at the National Institutes of
Health to support projects such as the construction of the John Edward
Porter Neuroscience Research Center and a centralized, multi-level
animal facility.
Enhancing Coordination and Reducing Duplication of Operating Systems
The only way that this Department can effectively serve its many
clients is if we commit to making the necessary investments in our
management and infrastructure. One of the challenges in a large,
decentralized Department such as HHS is finding ways to bring together
diverse activities and to develop coordinated systems for managing our
programs. Our budget provides the resources necessary to begin the
process of streamlining our financial management and information
technology systems so that we can enhance coordination across the
Department and eliminate unnecessary and duplicate systems.
For financial management, we propose to invest $92.5 million, an
increase of $50 million over this year, to move toward a unified
financial accounting system, including funding for HCFA's accounting
system. The Office of Inspector General has cited problems with the
Department's current system structure, which involves five separate
accounting systems operated by multiple agencies. We plan to replace
these antiquated systems with unified financial management systems that
will increase standardization, reduce security risks, allow HHS to
produce timely and reliable financial information needed for management
decision-making, and provide accountability to our external customers.
In the information technology arena, we are proposing $30 million
for a new Information Technology Security and Innovation fund.
Currently, the Department's information technology systems are highly
decentralized, heterogeneous, and vulnerable to exploitation. Funds
would be used to implement an Enterprise Infrastructure Management
approach across the Department that would minimize our vulnerabilities
and maximize our cost savings and ability to share information. With
this approach, we will be able to reduce duplication of equipment and
services and be better able to secure our systems against viruses and
network intrusion.
As the largest grant-making agency in the Federal Government, this
Department will also continue to play a lead role in the government-
wide effort to streamline, simplify, and provide electronic options for
the grants management processes. As part of the Federal Grant
Streamlining Program, we will work with our colleagues across the
government to identify unnecessary redundancies and duplication in the
more than 600 Federal grant programs and to implement electronic
options for all grant recipients who would prefer to apply for,
receive, and close out their Federal grant electronically.
Redirecting Resources and Enhancing Flexibility
Being a wise steward of taxpayer resources means not only
recognizing where you need to invest but also where resources can be
redeployed to more effective uses. In preparing our budget, we
carefully reviewed each agency, identified areas where funding could be
redirected, and made targeted reductions in selected programs. The FY
2002 budget eliminates $475 million in earmarked projects and $155
million in funding for activities that were funded for the first time
in FY 2001. The one-time nature of most of these projects did not
necessitate their continuation in FY 2002 allowing the Department to
redirect the associated funding to higher priority investments
described in this testimony while moderating the overall growth of the
HHS budget. In addition, the budget shifts $597 million from programs
that are duplicative, or whose goals are better met through other
avenues, to higher priority activities. And, to assist in financing
other high priority activities, the budget expands the use of Public
Health Service Evaluation funds. These decisions helped to meet our
goal of moderating the large increases in discretionary spending that
have occurred over the last few years and putting the budget on a more
sustainable growth path for the future.
This Administration is also committed to giving States greater
flexibility to manage public health grant programs. Our budget proposes
to give States expanded authority to transfer funds among public health
grants, thereby enabling them to make more efficient and effective use
of Federal resources and to target and reallocate funds to public
health priorities identified at the State and local levels.
In addition to giving the States greater flexibility, I am seeking
to increase my transfer authority from one percent to six percent, and
to eliminate the restriction that the transfer may not increase an
appropriation by more than three percent, and to make it Department-
wide. I believe this transfer authority is a valuable tool for managing
the Department's resources and will allow me to respond to emergency
needs or unforeseen events that would otherwise adversely effect a
program or agency.
Continuously Evaluating and Improving Program Performance
The Government Performance and Results Act serves as an important
tool for making sure that this Department is not only doing the right
things but that we are doing them well. As in previous years, our
budget request is accompanied by the annual performance plans and
reports. The performance measures and targets in these reports touch
nearly every aspect of the Department's multi-faceted mission and
detail a number of notable achievements, including:
HCFA met its FY 2000 target of reducing the Medicare error
rate to 7 percent. Auditors estimated improper payments at
$11.9 billion, compared with $13.5 billion in FY 1999. The
error rate has fallen to roughly half of what its was in FY
1996, and HCFA is pursuing increasingly rigorous goals for FY
2001 and FY 2002.
CDC reported a reduction of perinatal Group B streptococcal
disease--the most common cause of severe infections in
newborns--by 70 percent from 1995 to 1999, exceeding the goal.
GPRA has been and will continue to be an important part of our
effort to improve the management and performance of our programs.
expanding access to quality health care
Expanding Community Health Centers
Our budget also proposes steps to strengthen the health care safety
net for those most in need. Community Health Centers provide high
quality, community based care to approximately 11 million patients, 4.4
million of whom are uninsured, through a network of over 3,000 centers
in rural and urban areas. The President has proposed to expand and
increase the number of health center sites by 1,200 by FY 2006, and to
double the number of individuals without alternative coverage who are
served by the centers. As a first installment of this multi-year
initiative, we propose to increase funding for Community Health Centers
by $124 million. We will also be looking at ways to reform the National
Health Service Corps so as to better target placement of providers in
areas experiencing the greatest shortages of health professionals.
The Administration believes we should increase our investment in
proven programs--like the Community Health Centers--and provide
communities with increased flexibility through the President's Healthy
Communities Innovation Fund, which allows communities to address health
care access challenges in innovative ways using existing resources.
Increasing Access to Drug Treatment
The problems caused by substance abuse affect not only the physical
and mental condition of the individual, but also the well-being of
society as a whole. Nationwide, approximately 2.9 million people with
serious substance abuse problems are not receiving the treatment they
desperately need. To help close this treatment gap, we propose to
increase funding for substance abuse treatment by $100 million. Of
these funds, $60 million will be used to increase the Substance Abuse
Block Grant, the primary vehicle for funding State substance abuse
efforts, and $40 million will go to increase the number of Targeted
Capacity Expansion grants, which seek to address the treatment gap by
supporting strategic and rapid responses to emerging areas of need,
including grants to organizations that provide residential treatment to
teenagers.
Organ Donation
Our budget supports an initiative very close to my heart.
Approximately 75,000 patients are awaiting organ transplants, far above
the number of available donors. In fact, organ transplants in 2000
totaled 22,827, an increase of 1,172 over the 21,655 transplants that
occurred in 1999. The number of living donors rose from 4,747 in 1999
to 5,532 in 2000, an increase of 16.5 percent, the largest one-year
jump ever recorded. While I am encouraged by the progress that has been
made in the last year, there is still a very long way to go. To tackle
this problem, I launched a new national initiative, on April 17th, to
encourage and enable Americans to ``Donate the Gift of Life''. I am
beginning a national ``Workplace Partnership for Life'', in which
employers, unions and other employee organizations can join in a
nationwide network to promote donation. I released a model organ and
tissue donor card, incorporating proven elements from today's donor
cards and have ordered an immediate review of the potential of organ
and tissue registries where donors' wishes could be recorded
electronically and made available to families and hospitals when
needed. I have also made a pledge to create a national medal to honor
the families of organ donors and will create a model curriculum on
donation for use in driver education courses, to be offered to states
and counties nationwide. And, let me tell you, this is just the
beginning. I intend to do everything I can to increase organ donation
throughout America and to create the most comprehensive effort ever in
our nation regarding donation and transplantation.
Patient Safety and Health Care Quality
The Agency for Healthcare Research and Quality (AHRQ) is the
Federal agency with primary responsibility for research on the Nation's
health care system and is HHS's lead agency for improving patient
safety and the quality of everyday health care. The FY 2002 budget
provides a total program level of $306 million for AHRQ, an increase of
$36 million or 13.5% over FY 2001.
AHRQ will devote a total of $53 million to identify ways to reduce
the incidence of medical errors. These funds will support activities to
research the causes of medical errors, develop and test new
technologies to reduce medical errors, test reporting strategies, and
improve training. Earlier this week, I announced the establishment of a
new Patient Safety Task Force within the department in which AHRQ will
collaborate with FDA, CDC, and HCFA to improve existing reporting
systems on patient safety. AHRQ will lead this effort to identify the
type of data health care providers, states and others need to improve
the safety of health care services.
Our request includes a $26 million increase for research on health
care quality and cost-effectiveness. Like you and many others, we are
reviewing the recent recommendations by the Institute of Medicine for
research to improve the quality of health care. Once that review is
complete, I expect that an appropriate portion of these resources will
be directed toward the recommendations that we conclude should be given
the highest priority. I also expect the findings of this an other
research on patient safety, which has emphasized the importance of
encouraging and rewarding the development of health care systems that
encourage safer and higher-quality care, to guide our efforts to
improve Medicare, Medicaid, and other government health programs.
PATIENT PRIVACY PROTECTIONS
Knowing of this Committee's concern for patient privacy
protections, I wanted to close by commenting on the recent decision two
weeks ago by President Bush to immediately put into effect strong
patient privacy protections. President Bush and I strongly believe that
we must protect both vital health care services and the right of every
American to have confidence that his or her personal medical records
will remain private. In response, we allowed the patient privacy rule
to take effect on April 14, 2001. As you know, under the HIPAA law,
affected parties have two years to comply with the new regulation,
until April 14, 2003. While I understand that some members of this
committee continue to have concerns and differing opinions as to the
best way to protect privacy, our citizens must not wait any longer for
protection of the most personal of all information--their health
records.
Over the past two months the Department of Health and Human
Services received and reviewed more than 11,000 written comments, with
24,000 signatures, on the health information privacy rule. In addition,
we met with a diverse group of lawmakers, interest groups and health
care leaders to listen to their concerns regarding this regulation.
We will consider concerns expressed by all commenters as we move to
develop guidelines to clarify certain points of confusion about the
rule, and will issue our first guidance for affected organizations next
month. Furthermore, we will work with consumer and industry groups to
develop additional guidance in the future. We are also considering
where modifications to the rule may be needed to ensure that quality of
care does not suffer inadvertently from these new rules.
The focus of our guidance and modifications will be to clarify that
doctors and other providers continue to have access to the medical
information they need to provide timely, high-quality care to their
patients. Patient care will not be unduly hampered by confusing
requirements surrounding consent forms. And, parents will have access
to information about the health and well-being of their children. We
will ensure that this patient privacy rule delivers strong and long
overdue protections for patient privacy while maintaining the high
quality of care we expect in this great nation.
WORKING TOGETHER TO BUILD A STRONG AND HEALTHY AMERICA
Mr. Chairman, I want to thank you for the opportunity to testify
before you today on the many different proposals that constitute the
Department of Health and Human Services budget for FY 2002. The common
thread that binds them all together is the desire to build a strong and
healthy America and to improve the lives of the American people. Our
proposals, from modernizing Medicare and expanding access to care to
enhancing scientific research are presented with these simple goals in
mind. I know we share these goals and I look forward to working with
you on these important issues. I would be happy to address any
questions you may have.
Mr. Bilirakis. Thank you very much, Mr. Secretary, and we,
too, are thrilled with the many somewhat innovative ideas that
your testimony speaks to. Over the years, certainly the last
few years, we have held a number of hearings on HCFA regarding
some of the problems there and the terrible image of the
organization. I am not saying it is all completely deserved,
but it is a terrible image that HCFA has had over the years.
In terms of testimony from HCFA personnel, I can't say that
there has ever been any emphasis on not enough dollars. It has
been members up here who basically made those points for the
most part, but not by HCFA.
And, in fact, I recall a particular hearing when one of the
HCFA personnel--I can't recall whether he was a witness or
whether he was just with a particular witness--came up to me
and said to me that they had requested over a period of time
additional dollars for HCFA, and OMB would shoot them down and,
therefore, for that reason, they weren't coming into those
requests.
I understand that your request for HCFA is $2.31 billion,
which is higher than any request in the last few years; and I
certainly commend you for that.
My question is--and certainly I won't say this is extra
money; it sounds like certainly it is very needed money, but it
is extra in the sense of that it hasn't been requested in prior
years. What would you intend to do with that money?
Mr. Thompson. Thank you so very much, Mr. Chairman. This is
a subject that it is very near and close to me, and I am
delighted to be able to answer that question to the best of my
ability.
HCFA is an agency that everybody loves to hate. I haven't
found anybody that really likes HCFA. Democrats, Independents,
Republicans, providers, people that write into my agency,
everybody hates HCFA. And I am no exception. As a Governor, I
was probably one of the biggest critics in America against
HCFA.
So I went out and talked to people at HCFA. I first got up
in front of several thousand of the employees, and I said, you
know, it is difficult to love something called a HCFA. You
know, I think the first thing we might want to do is just
change our name.
The second thing I said, what is the problem? I mean, why
are you having the problems out here? And I listened to a lot
of wonderful employees. My attitude about HCFA has changed
tremendously.
First off, Mr. Chairman and members, they have a computer
program. They have a billion transactions a year, and they have
a computer program that was installed in 1970. Do you know of
any law office, any medical office, any hospital, any clinic,
any insurance company, any business that still operates in
America with an insurance--with a computer system that was
installed in 1970? Granted, it has been updated, but it is
still is a 1970 chassis.
Then, I looked at it and they came to me and they--the IG
inspector said they had $11.8 billion in mistakes last year.
And I called in the people from HCFA and I said, how can we
have $11.8 billion in mistakes? And they said, Mr. Secretary, 5
years ago, it was $22 billion.
And I said, well, that may be true, but that is not good
enough. We are going to get rid of it. And I said, what is the
problem? He said, we have an antiquated bookkeeping system. And
I said, what do you mean? He said, we still have a single-entry
bookkeeping system which went out in 1911. They don't have a
double-entry bookkeeping system. I don't know of any business
in America that can run on a single-entry bookkeeping system.
The third thing is, when Medicare was adopted in 1965,
there was a compromise made, which there is in all legislation
usually, a big compromise in which the hospitals and the health
insurance industry at that time made a request, and Congress
adopted to get Medicare through, that the hospitals would be
able to designate or nominate the fiscal intermediaries to
operate the contracts. And so we cannot put an RFP out and find
the best person to be a fiscal intermediary. It has got to be
nominated by the hospital industry.
This is contentious, and I put it out there. It is
something this is going to have to be looked at.
The second thing is, it is on a cost-plus type of contract.
Now, how can you have efficiencies when you have a cost
contract? What is the reason? What is the motivation to saving
costs?
So the money that I am requesting is to modernize and to
change HCFA. I also asked the people at HCFA, you know, you
have been beaten down by so many people that you have an
attitude out here that you look for ways to say no. Why don't
we try and change our attitude and try to find a way to say yes
in the attitude of HCFA? And they said, you know, that is a
good idea. And that is what we are going to do.
These are the kinds of changes that I want to bring to
HCFA; but I need the dollars, and I want to tell you it was a
tough sell at OMB. And I fought very hard to get this in,
because if you want to change HCFA, we have to put the
resources in there to get the job done.
And I am asking for this committee's support, because this
committee is the one that is taking a real interest, Mr.
Chairman. I know my answer has gone too long, but you can tell
I am dedicated to changing it and I need your help to do it.
Mr. Bilirakis. I appreciate that answer, and we certainly
appreciate your persistence and perseverance with OMB, because
I guess they have been a fly in the ointment in that regard.
Very quickly, my time has expired. But the cost-plus nature
of those contracts that you mentioned, is that something that
HCFA can do----
Mr. Thompson. No.
Mr. Bilirakis. [continuing] on their own? It would take
legislation on our part?
Mr. Thompson. You have to change that, Mr. Chairman.
Mr. Bilirakis. That goes to many of the questions we have
asked over the years. Tell us how. What can we do legislatively
to help you do your job better? I don't recall that there has
ever been a request made to this committee over the years to
give them the kind of leeway to change that.
Mr. Thompson. It is in the law, but we have to change it,
so we can put it out. Times have changed since 1965, and also
it is--we should reduce the number of fiscal intermediaries.
You know, with the modern computer system, we can get by with
10, 15, but that is--I want to be up front with you, you are
going to have a lot of opposition to changing this from the
status quo.
And so I am telling you, it needs to be changed. I am
asking you to change it, but I also want to alert you--I am
very honest with you--it is going to be difficult, but it needs
to be changed.
Mr. Bilirakis. Who was going to oppose it?
Mr. Thompson. Everybody has got a contract, sir.
Mr. Bilirakis. Yes.
Mr. Thompson. Every hospital in America.
Mr. Bilirakis. Yes.
Mr. Brown.
Thank you very much, Mr. Secretary.
Mr. Thompson. And every Congressman and Senator has a
fiscal intermediary in their State.
Mr. Bilirakis. That is what I was getting at.
Mr. Brown. Thank you. And I appreciate your comments about
HCFA. I don't agree that HCFA is as universally unpopular as
some here say.
Mr. Thompson. Thank you.
Mr. Brown. I think it is certainly unpopular with this
subcommittee, and we spend much time in this subcommittee
criticizing HCFA and micromanaging HCFA, giving HCFA new
regulations and rules to carry out and starving it as an
agency.
Mr. Thompson. That is true.
Mr. Brown. So I think there is--there oftentimes needs to
be a mirror in front of us when we criticize HCFA. It is
certainly deserving, as all institutions are deserving of some
criticism.
I want to talk about prescription drugs, but not so much
the coverage that you suggested and the President suggested
with the $100 million. As you know, many of us in this
institution and both parties think that is not enough to do a
good prescription drug plan.
But let me talk more about the costs. Generic drug
application review times average about 18 months for generics.
In contrast, new drug applications' review times average about
12 months, and for those that are on the so-called ``fast
track,'' that is--apparently the average is 6 months.
Your budget provides no extra funds for generic drug
approvals, but all of us know that generics will save billions
of dollars. The faster generics are in the pipeline, in the
marketplace, the more money that--the billions of dollars that
consumers would save as a result.
Would you reconsider this matter in terms of your budget
and work with us, one, to provide more money for speeding
generic drug applications? And second, would you work with us,
overall, to speed the approval with additional money and in
other ways also?
Mr. Thompson. Congressman, let me just tell you, this is an
area that is a big concern of mine. And I want to work with
you. I don't know if it is just extra money that it needs. I
want to work with you to speed up the process and make it more
efficient and find ways that we can accelerate, when necessary,
when safety allows us to do it, and make sure that we don't go
too fast so that we in any way hamper the patient's safety.
I am not sure that I can say here that the only way that
you will support me or that I can support you is by increasing
the money. I don't know so. But the problem is, I have only
been at the Department for 75 days, and this was--the Food and
Drug Administration is an area that I have not been able to
devote as much attention to as yet, but it is something that is
a prime concern of mine. But I want to work with you in a
cooperative way.
Mr. Brown. We have determined in the subcommittee in the
past and in this Congress that more money did, in fact,
accelerate approval time, reduce approval time, through the
Prescription Drug User Fee Act, through PDUFA 1 and PDUFA 2l;
and that was the purpose for it, in part. There were other
reforms, but a big part of it was expending the money. And we
can certainly guarantee a patient's safety--if we can do a new
drug in 12 months, we can certainly--and a fast track in 6, we
certainly can approve the generic drug----
Mr. Thompson. I can't defend----
Mr. Brown. [continuing] and partly take money.
Mr. Thompson. There is an additional $37 million in this
fiscal year budget----
Mr. Brown. Okay.
Mr. Thompson. [continuing] a 5.6 percent increase.
Mr. Brown. Let me talk about cost containment and a
prescription drug benefit, whether it is the administration
plan or another plan.
Estimates for prescription drug spending continued to go up
at an alarming rate. CBO's new drug baseline this year
increased significantly since everyone--if someone introduces a
plan in 6 months, a year from now, it is clearly costing more.
Mr. Thompson. Sure.
Mr. Brown. Some have suggested that we rely on competition
from private plans through an HMO or through an insurance
mechanism. That was tried in Nevada, they didn't even have
anybody bid. Finally, when they bid, the cost was too high.
Pretty clearly, that hasn't worked.
There are several other ideas that have been suggested. I
would just like to ask you your opinion of them in terms of
prescription drug cost containment. One is using a pharmacy
benefit manager, which the private sector uses, which your
predecessor, Secretary Shalala, suggested in her plan last
year. That is estimated to save 10 or 15 percent. That is not a
huge savings, but that could be a start.
Second, would you support the approach of the Allen bill to
allow Medicare--as the Canadians do, for instance, to allow
Medicare to negotiate on behalf of the 39 million beneficiaries
to get lower prescription drug costs? Would you look at
something that I worked on legislatively that was suggested
most recently by Gail Wilensky, reducing the length of patents
so generics could get into the pipeline sooner, would pay a
significant royalty to the patent-holder, and be competition in
the marketplace.
Which of any of those would you support--PBMs, the Allen
proposal with the Medicare buying power, if you will?
Mr. Thompson. Congressman, I don't think any of those is
mutually exclusive. I think we should look at all of them. I
don't think there is anything that should not be under the
table when we look at drug costs and drug containment. I think
it only behooves as a department and Congress to try to find
ways to control pharmaceutical costs in America.
And I want to be--I am willing to work with you, but I
would like to point out that it is the President's position,
and my position very strongly, that in order for us to have
prescription drugs included in Medicare, we have to reform
Medicare.
I really strongly believe that we have the greatest
opportunity ever to reform Medicare and include prescription
drugs. But if we just do the prescription drugs, I don't know
if we will ever get around to reform and strengthen Medicare,
and I think that is just as vitally important as prescription
drugs are.
Mr. Brown. Will you suggest a mechanism for cost
containment to this Congress when you recommend--will you at
some point do that?
Mr. Thompson. I am in the process, Congressman, right now,
of working with the White House on Medicare and prescription
drugs, and absolutely it will be coming.
Mr. Brown. I hope it goes beyond using private plans, which
private insurance companies don't have because of adverse--
don't have any real incentive to write policies when they
cannot go beyond it.
Mr. Thompson. I can assure you, Congressman, that I am not
an individual that likes the status quo and what is on the
table. I like to look at all opportunities. And your options
are just three, but I am not limited to those three. There are
many others that I am looking at.
Mr. Brown. We can give you more also. Thank you, Mr.
Secretary.
Mr. Bilirakis. Dr. Norwood.
Mr. Norwood. Thank you, Mr. Chairman.
Mr. Secretary, it is fairly clear to me and I think most
members of the committee that we have a looming crisis in
Medicare. We just simply cannot ignore it, and the longer we
wait, the harder it is going to be to deal with it.
I agree with your remarks 100 percent that--I don't see how
we can logically produce a prescription drug plan without
looking at the big picture first or we are going to add to the
future problems of Medicare.
Mr. Thompson. Yes, sir, accelerate it.
Mr. Norwood. My question is timing. Do you expect--I know
you will work with Congress to enact Medicare reforms, but do
we expect that this year, or will it be next year or the next
year?
Mr. Thompson. I want it this year, Congressman. I am--I am
very much in favor--I am an activist. I don't like to wait, as
you probably have heard. I like to see a problem--I like to
come up with a common-sense solution and move forward on it.
Mr. Norwood. You may have heard, I don't like to wait
either, and I would like for you to do it this year.
Mr. Thompson. I figured I was talking to the choir when I
said that, Congressman.
Mr. Norwood. Should we--does it make sense, for example, to
not rush, though, to cure the problem in Medicare----
Mr. Thompson. True.
Mr. Norwood. [continuing] but in the interim do something
about prescription drugs? Helping Hands comes to mind,
something that immediately we can begin to help those people
who simply cannot afford any type of medication right now;
should we do that as an interim step to get to the final
product?
Mr. Thompson. If, in fact, we can't get the finished
product down, this other absolutely. And the President has put
out Helping Hand because he was not sure that we could reach a
bipartisan solution on Medicare reform with prescription drugs.
That is why he put out an additional $12 billion this year for
States to come up with their own individual program over the
course of the next 4 years, $12 billion each and every year.
So it is a wonderful fallback plan, and it is one which we
should take to the forefront, if in fact we had mired down in
not being able to solve the major problem, which is Medicare
reform, Congressman.
Mr. Norwood. We all have been rather caught off guard about
the 33 percent increase from CBO in the costs of drugs. I don't
think we should have been caught off guard, but perhaps we
have.
Do your budgeteers feel that we have allocated enough funds
to enact the reforms needed to change reform, strengthen
Medicare programs?
Mr. Thompson. We feel that it is necessary to take a look
at the overall reforms in Medicare and then cost it out. And at
this point in time, we are not--not at liberty or not able to
tell you if the $153 billion--we think $153 billion over 10
years can get the job done.
Just a lot of people out there, including CBO, that think
it will cost more. But they do not put into their mix any cost
savings in Medicare reform, and we would like to put the
Medicare reform out there with the prescription drug and then
have a cost analysis by CBO and other individuals, Mr.
Congressman.
Mr. Norwood. Well, I would like to go on record just
agreeing with that. I don't want to rush into the fix; I want
to do it right when we do it, because this is very major for my
grandchildren and yours.
Mr. Thompson. Absolutely.
Mr. Norwood. But in the interim, if you think just with
your brain, not necessarily with your heart, for us to be
preventive in the area of prescription drugs for those who can
afford half their prescription or none of their prescription,
probably there is a cost saver for the trust fund.
There are going to be--reap great benefits with being able
to take those medications rather than spend 2 weeks in the
hospital, because they didn't take those medications. So I am
just saying, I agree with you, and would encourage us perhaps
to think like that.
I am--very quickly, because my time is running out, I am
one of those people who loves to bash HCFA. And I don't do that
because I don't have anything else to do; I do that because
every time I go home, I get jumped on, big time, by a lot of
people who say their life is absolutely miserable dealing with
HCFA. Though, I agree with Mr. Brown wholeheartedly, it isn't
just HCFA; it is the Congress of the United States and some of
the mess we do, micromanaging that particular agency.
One of the things I need to hear is, there is some way
possible that we can do a better job from HCFA to the provider
physician at home in terms of the rules and regulations that
that physician has to live under. Now, some people say it is
130,000 pages of rules and regulations. Some people say it is
40,000--whatever, it is about 18 inches high. We need to be
able to do something to help our doctors have more time with
their patients and less time with government paperwork.
Any ideas?
Mr. Thompson. We have lots of ideas, but we haven't
implemented anything yet. But we are talking to the people at
HCFA. I had a meeting in my office at 7 o'clock on Monday
evening on some new HCFA rules. And I looked at them and I
said, I can't understand them. And, granted, I have only been
here for 75 days, but I looked at it as a country lawyer, and I
could not understand it, so I sent it back.
I am going to keep sending things back until they simplify
it so I can understand it. If I can understand it, I am
confident that a doctor can understand it.
Mr. Norwood. We have to simplify it, because it is so
unfair.
And, just quickly, the House has passed----
Mr. Bilirakis. We will have a second round if the members
prefer. I don't want to go too far afield here. Very quickly.
Mr. Norwood. I just want to mention the lockbox has been
passed by the House, so that we don't tap into the Medicare
Trust Fund which I am totally against, and the geriatric ward
over there takes a little longer. They will get to it
eventually, and perhaps we will make sure.
Mr. Thompson. I am not going to get into this fight,
Congressman.
Mr. Bilirakis. Mr. Pallone, you may inquire.
Mr. Pallone. Thank you, Mr. Chairman.
Mr. Secretary, I wanted to follow up on what Mr. Brown
mentioned with regard to generic drugs, because I really am an
advocate for promoting generics as a way of saving costs. I
know you sort of deemphasized the money factor, if you will.
But, you know, the fact of the matter is that there is a lot of
manipulation that goes on with the Waxman-Hatch Act that I
think contributes to the fact that there is so much delay with
getting approval for generic drugs.
You know, you have this filing of frivolous patents with
the FDA to trigger this mandatory 30-month hold on approving
generic applications. You have these patent extension bills,
you know, private bills, so to speak, that we hear about during
the dark of the night or when we are at the end of the session,
and you have also had the misuse of citizens' process.
These are a lot of, you know, procedural ways that are
used.
Mr. Thompson. Sure.
Mr. Pallone. And I just wondered if you would support some
kind of statutory mechanism to try to address some of these
manipulations and to try to bring the approval process more in
line with the amount of time it takes for the brand industry to
get approval.
Mr. Thompson. Congressman, I would like to have some time
to--I am not delaying the answer--your direct answer to your
question. I would just like to have some time to study FDA.
What I intend to do is, I intend to go to every one of the
operating divisions and spend a week, actually operating the
division and being there to find out exactly how things go.
I would like to be able to come back to you sometime later
on this summer and talk to you about it and about some of my
suggestions, how we can improve it.
Mr. Pallone. That is fine. I don't want to spend a lot of
time.
Mr. Thompson. I want to point out, we are putting a 5.6
percent increase into this area.
Mr. Pallone. I appreciate that. I don't want to delay it.
You know, I appreciate the fact that you will get back to us.
But I just want to point--I think there are a lot of things
that can be done other than the money as well. I agree with the
fact that the money is an important factor.
Mr. Thompson. The suggestions you have are probably very
good ones. I would like to be able to take those suggestions;
and I solicit and--I am the type of person who loves ideas. If
you have got ideas, I would like to take a look at them and
work on them and come back to each of you, Democrats and
Republicans alike, to see if we can come together, because my
feeling is, if we work together, we can come up with a better
product.
Mr. Pallone. All right. I appreciate that.
Let me ask you about the patient protection provisions that
we would like to see in the Medicaid program. You know that in
the last, you know, few days or the last couple months of the
Clinton administration, we put in place, or he put in place a
regulation that would allow the patient protection, something
like the Patients' Bill of Rights to be applied to Medicare--to
Medicaid, I should say. We already have it for Medicare.
I understand that the Bush administration has delayed that.
It was supposed to go into effect, I think, sometime earlier in
April. They have now delayed that and said they are not going
to make a final decision on whether to lift the hold on that
until sometime in June.
That concerns me, because I have to be honest with you and
say we had a hearing on HMO reform in the subcommittee a month
or so ago. At that time, I was very critical of the Bush
administration because I think during the campaign the
President suggested that he was going to address Patients' Bill
of Rights and would support something like the Texas law.
Yet, Mr. Ganske, Mr. Dingell, others have introduced on a
bipartisan basis a bill, a Patients' Bill of Rights bill that I
think is exactly like the Texas law, and so far all we have
seen from this administration is the delay in this regulation
with regard to Medicaid--the Medicaid program and criticism, if
you will, of the Ganske-Dingell bill saying that it is not, you
know, what we want.
I just don't see any effort really on the part of the
administration to address the issue of HMO reform. I think it
is something that was talked about in the campaign, but in
terms of the actions in the first 100 days, the only action is
to say we don't like Ganske's bill, and we don't--we are not
sure if we are going to put these regulations into effect.
Can you assure us that we will see these regulations go
into effect so that Medicaid has the same patient protections
as Medicare? What is going to be done? What is the
administration proposing on the Patients' Bill of Rights?
Mr. Thompson. Very valid question. As you know, all rules
and regulations were put on a 60-day hold. But you also know
that the privacy rule was published on time last--2 weeks ago
on Friday. It is a pretty strong indication that this President
is very--very definite on protecting patients' rights and is
very passionate about it, as you are, as members are, as I am.
In regards to the Medicaid one, we are looking at it and
reviewing it, and it will be--we will be making a final
decision in the course of the next several weeks. And I will
get back to you if I have any problems with it, but right now,
I haven't discovered any.
Mr. Pallone. You know, I have to say, Mr. Secretary, I
believe strongly if the President got up and said, I want to
meet on a bipartisan basis with the members who are playing a
key role on this, and I want to resolve this and have a
Patients'----
Mr. Thompson. Are you talking about the Patients' Bill of
Rights?
Mr. Pallone. I am talking in a larger sense. I want to have
this done by June 1, I have no doubt that it can be done. I
really don't think the differences are great--are that great,
and I don't see the President moving in that direction.
Mr. Thompson. I think the President is doing a very good
job in moving that direction. He set out his bill of
particulars, what he needs and what he would like to see in it.
We all know, you know, every member on this committee and every
person in the House and the Senate knows that there are really
two big issues, liability and scope. And we have to work on
those two, and we have to work on them on a bipartisan basis.
I am confident that we are going to have a Patients' Bill
of Rights sometime this summer, and we are going to be able to
resolve our differences on those two subject matters.
Mr. Pallone. I hope so. And I appreciate the fact that you
are willing at least to talk about the summer as a deadline,
because I am just afraid it is going to continue.
Mr. Thompson. That is my suggestion, but I am finding out
that I am no longer a Governor; I am a secretary, so. . .
Mr. Pallone. Thank you, Mr. Chairman.
Mr. Bilirakis. Thank you.
Dr. Ganske.
Mr. Ganske. Once again, Mr. Secretary, thank you for
coming. Mr. Secretary, since I came to Congress in 1995, when
the Republicans took the majority, we have been universally
opposed to user fees. President Clinton in his budgets
repeatedly, across various agencies, proposed user fees.
I can specifically remember a lot of Republican comments on
the floor of the House of Representatives and in the Senate
against user fees as being basically tax increases. In
addition, as I mentioned earlier, in my home State, we were
dead last in terms of provider reimbursement. My rural
hospitals are really hurting.
I am concerned about a user fee on submission of claims to
Medicare. I personally consider that to be a tax increase, and
I can tell you that my providers back in Iowa, considering
their low reimbursement, already believe that adds insult to
injury.
And so my question to you, Mr. Secretary, is, is this
administration proposing user fees on data transmission or
claim transmission to Medicare?
Mr. Thompson. First, let me tell you that it is not the
President. It is not this administration. It is Tommy Thompson
who is pushing this. So you have nobody to get mad at me except
me, Congressman, because I am the one who fought very hard to
get this in, and I will tell you why.
First off, I have the same problems, or did have the same
problems in Wisconsin as far as reimbursement. I didn't know
Iowa was dead last, I thought Wisconsin was dead last, so I
understand your concern. But I also understand full well that
HCFA needs a lot of assistance, and when 80 percent of our
claims are being sent in via the computer, it is much easier to
process. And if somebody else wants to send in paper, which
costs more to process, slows down the system, delays it so your
doctors and hospitals don't get reimbursed as quickly as they
would have if everything was on the computer system, I thought
it was only fair and equitable if a doctor and hospital want to
continue to use paper, they should pay an additional dollar for
it.
I would then take that money and use it to upgrade and
improve the computer system at HCFA. It was one way I found to
improve the resources necessary to make HCFA more responsive.
And so don't blame the President, don't blame OMB; blame me.
And tell your doctors and hospitals, when they complain to you,
to call me; and I will tell them they don't have do pay that
user fee, all they have to do is convert over to a computer
system like 80 percent of the other providers do in America.
It would speed up the process, and it would make it more
efficient, and you would learn to love a HCFA just a little bit
more, Congressman.
Mr. Ganske. Mr. Secretary, let me ask you to reconsider
your position on this----
Mr. Thompson. Okay.
Mr. Ganske. [continuing] and here's why. I think it is fine
to have electronic transmission, and the benefit, if it really
is there, is in the quicker return on your reimbursement.
Mr. Thompson. Right.
Mr. Ganske. Okay. So that is a carrot, but I don't think
that you should basically create a tax increase on those who,
for particular reasons, may be submitting paper.
I can give you a lot of reasons why those claims are
submitted on paper. From my own medical practice, for instance,
we submitted paper because we provided documentation on a large
number of procedures that HCFA was going to require paper
documentation anyway.
And so if we didn't do that in the first place, then we
were looking at a 2-, 3-, 4-, 6-month delay because we would
send in our electronic claim first, and then we would months
later get a request for paper. There are a large number of
procedures that particular providers need to do that HCFA
requires the paper documentation on.
We can't, for instance, submit the pathology report or the
operative report by electronic methods. Those are things we
receive via paper from the hospital.
I am totally in favor of providing the necessary funding
for HCFA to do its job. For years, I have been a supporter on
that, Mr. Secretary. But to leave the carrot for those who want
to submit by electronic, but don't provide a hammer for those
who, for various reasons, have to submit paper; there are a lot
of reasons.
And that gets me to the second thing about----
Mr. Bilirakis. Please do this very quickly, the time is up.
Mr. Ganske. For at least 10 years, 8 years, HCFA has
refused to give prior authorization for procedures, and they
basically, in my opinion, have tried to scare Medicare patients
from getting needed treatment.
For instance, perhaps a patient needs a procedure on their
eyelids because they can't see laterally when they drive, okay,
so today HCFA will say, well, maybe we will pay for it and
maybe we won't. And if we don't, then you, the Medicare
recipient, are responsible.
In the past, it used to be, you would send in your
documentation, visual fields, whatever, and you would ask for a
prior authorization from HCFA, and they would say yes or no.
Then at least the Medicare beneficiary knew where they were at.
I think the procedure that is currently followed by HCFA is
designed to scare Medicare recipients from getting needed
treatment. I would sincerely ask that you revise this policy so
that on particular types of procedures we can return to a prior
authorization method, so that you can put at ease the mind of
the Medicare recipient, knowing in advance whether in fact this
will be a covered service.
Mr. Bilirakis. The gentleman's time has expired. If you
have a very brief comment, Mr. Secretary, you will have the
opportunity obviously in writing to respond to a number of
questions.
Mr. Thompson. Thirty seconds?
Mr. Bilirakis. Thirty seconds.
Mr. Thompson. Thirty seconds.
Mr. Bilirakis. Without objection.
Mr. Thompson. I will consider it. But I would like you in
response to give me a list of all of those problem areas.
Let us change the rules. Let us make it easier. And I also
have the provision to waive any problems under the user fee. So
in your case, if there was a problem, we could waive it.
Mr. Bilirakis. Mr. Green to inquire.
Mr. Green. Thank you, Mr. Chairman.
And again, welcome, Mr. Secretary.
In my opening statement, I talked about a number of issues,
but first I would like to talk about the CAP program, Community
Access Program. In your testimony you emphasized the importance
of utilizing our State and local community partners, and I
agree we must improve funding for the Community Health Centers.
But I question the elimination of the CAP program.
The CAP has helped fill the gaps in our health care safety
net by improving infrastructure, communications among agencies,
particularly in our urban areas like Houston which I represent;
and with better information, the agencies can provide
preventive primary and even emergency clinical services in an
integrated and coordinated manner.
The funding under CAP has been used to support a variety of
projects, to improve access for all levels of care for the
uninsured, and each community designs a program that best
addresses the needs of the underinsured and uninsured and the
providers of our community.
Again, I understand the flexibility that the CAP program
gives districts like I have in Houston. In fact, the vice
president of Community Outreach at the University of Texas
Medical Branch, Ben Raimer, said in a letter to the President,
``the Community Access Program is one of the programs that
works at the community base level and one that I feel fits
nicely with the President's own personal philosophy regarding
local community.''
Mr. Chairman, I would like to submit that letter from Ben
Raimer for the record.
Mr. Bilirakis. Without objection.
Mr. Green. Mr. Secretary, can you address the
administration eliminating the Community Access Program?
Mr. Thompson. Absolutely, Congressman Green. Let me just
say that we looked at it. And I am not saying that the program
is not good, but we felt that we could use the money more
effectively by putting it into Community Health Centers, we
could serve a lot more people; and that was a decision.
And in your business and in my business, you know, we have
to balance it off. And the Community Access Program is a
relatively new program. It has been in existence 1 year. I know
Texas has benefited. I know that Louisiana has benefited.
We felt the Community Health Centers is much more dispersed
throughout America, and that we would be able to help a lot
more underserved and uninsured families by putting the money
there. And that was the reason for it. Not to say anything
against the CAP program; we just made the decision that
Community Health Centers was a better buy for the money that we
had, and we invested it there.
Mr. Green. And I guess if you have that, those limits, but
again you really need both, the Community Health Services, but
also the coordination of benefits. So we do get the most out of
our dollars.
Let me go on to the CDC. Our chronic diseases like
diabetes, heart disease, cancer and arthritis are leading
causes of death in America. In fact, they kill 7 out of 10
Americans. The costs of chronic diseases are staggering. More
than 70 percent of health care expenditures in the United
States are for chronic diseases, and by 2020, $1 trillion, or
80 percent of the health care expenditures, will be spent on
chronic diseases.
Now, we have learned that chronic disease prevention and
control programs save lives and money. For example, the
diabetes programs resulted in a significant decline in
complications of the disease in New York. When CDC funded a
comprehensive diabetes control program, the hospital rates
decreased 35 percent in 2 years; and lower extremity
amputations have gone down by about 39 percent.
Can you explain the rationale behind cutting $175 million
from the CDC's chronic disease program?
Mr. Thompson. Because we took the money and put it into
NIH. We put in $639 million, which is a huge increase, in
infectious diseases in NIH. We felt, Congressman Green, that we
could do a better job trying to find the research necessary for
chronic diseases and put the money there, so we put a huge
increase in NIH to do that.
So there is a reduction in CDC of some $100 million, but
there is an increase of $639 million for the same type of
programs, more for treatment, more for research in NIH. And the
reason--and the reason we did that, Congressman, is that we
have an epidemic problem coming in diabetes, and the two things
that will prevent diabetes--enhance diabetes is changing the
life-style and exercise. We feel that research--and how we
might be able to do that.
And I intend to try to make the Department a focal point
for preventive health in America. I am asking you for your
assistance in this, because if we don't, the epidemic of
diabetes is going to continue to grow and get worse in your
State and in all the States in America.
Mr. Green. Mr. Secretary, I agree, but the concern I have
is, we have--we want the research.
Thank you again for plussing up NIH. It is an effort in
Congress we have tried to do, but we have to go from research
to prevention.
The concern we have, we have to move that science from the
bench to the trench where we can actually see it happen.
Mr. Thompson. I understand.
Mr. Green. And that is what CDC does. So if you would look
at it and say, we want to plus up NIH--and believe me, I think
you have unanimous support on this subcommittee. But also we
need to see that research being placed out there, like CDC
does, like we see the success in New York. I would like to have
the same success in Houston and in every city in our country
with diabetes control.
So that is the concern we have. We need to plus up the
research, but also make sure that information gets out on the
street.
Mr. Thompson. Thank you.
Mr. Bilirakis. Mr. Bryant to inquire.
Mr. Bryant. Thank you, Mr. Chairman.
Mr. Secretary, I would like to talk about two subjects, and
at the conclusion, I invite your comments on both of those.
The first has to do with Community Health Centers. This is
a program, I think, that has proven very efficient and cost
effective. It is one that is important to my district, which is
both rural and urban.
But we are looking at reauthorizing the health centers
program this year, and I certainly want to strengthen that
program as much as possible in order to serve more of the
uninsured in the future.
I am pleased that the President's budget has placed these
health centers--has called for doubling the number of patients
that they serve over the next 5 years, and also his budget
calls for an additional $124 million increase for these health
centers.
And, again, I will ask you to comment about that and your
view of these health centers.
But the second point I would like to make has to do with
medical records, privacy regulation. And your testimony has
indicated that you still have problems with the regulation that
would have been fixed through guidelines and additional
modifications.
I want to ask you about some of those general problems or
changes that you would recommend, but before I do that, I would
like to mention two specific problems I see. And this first one
is, as a former lawyer, recovering lawyer, I might add----
Mr. Thompson. Me too.
Mr. Bryant. [continuing] I would say that the American
Psychiatric Association points out a very good point in a
letter to you where they talk about the ability of attorneys
involved in litigation to acquire medical records.
It generally has been done over the years where you have a
medical consent authorization from the litigant, the patient or
at least they know about it, but under this new regulation, the
lawyer can simply write a letter and make a statement that this
is needed in litigation, and he is involved in it.
It is a little more sophisticated then that, but yet, the
patient whose record we are talking about is kind of taken out
of that loop. And you generally rely, I guess, on the integrity
of the attorneys. And I have a concern with that.
Second, it has to do with, I guess, the administration also
seeking additional funding for research on health quality; and
included in the health quality is the issue of medical errors,
this minimum standard that we are talking about with records
being----
Mr. Thompson. Minimum necessary.
Mr. Bryant. Yes. And how, if we are concerned about health
care in general, that we are going to limit in effect the
ability of doctors to acquire the records they might need from
other sources. It just seems to me that sort of works in the
other way, and it might cause more medical errors if the doctor
has not enough in the records to look at.
Those two examples and anything else you might mention, as
well as just a comment maybe on the Community Health Centers
program, I would appreciate it.
Mr. Thompson. Well, thank you for raising both issues with
me, Congressman.
First off, on the Community Health Centers, I happen to be
a very strong advocate. We have--back when I was Governor, I
put a lot of money into the Community Health Centers myself
from the State, and I am delighted that the President has seen
fit to try and increase the number of Community Health Centers
in rural America, as well as urban areas to underserved people.
Approximately a third of those are completely uninsured
families.
We are going to hope to go from 3,200 by--increase it by
1,200 and increase the number of patients being seen from 11
million to 20 million, almost a 100 percent increase. And what
a laudable goal, and I compliment the President on doing that.
I think you know we can really do a great job in covering
and getting a lot of uninsured and underserved people in to get
good health care, and that is what we want. That is what we
want in our country and that is what you want in this
Department--in this committee. So I think it is it is the right
decision and the right investment of our dollars.
And in regard to privacy, it is a very complex rule. There
is no question about it. But the basic thing is that we want to
protect patients' rights, as you do and as does every member on
this committee, and we are going to do that.
There are certain things--I didn't know about the
psychiatric letter we received--I think, 12,000 letters; I
haven't read them all, I am up to 3,300--no, not really. But we
are looking at them and trying to comprehend and put in some
sort of usable form how we might be able to make some
meaningful changes, but not get at the basic premise of
protecting patients' rights, which every one of us is concerned
about, especially the President.
And in regards to the minimum necessary standard, that has
to have some clarification, because we want to make sure that
the patient that goes in to see his or her doctor is going to
be able to get the necessary reports and the necessary
collaboration between the doctors to be able to give that
patient the best treatment possible. There has to be some
guidance in regards to that, some guidance in the purchase of
drugs, which is another problem.
I agree with you that the patient needs to be involved in
any litigation and should have to sign some sort of consent
form before that information is made available. So we will be
looking at it. I did not know that problem existed, and I am
very appreciative that you brought it to my attention.
Mr. Bryant. Thank you.
Mr. Bilirakis. The gentleman's time has expired.
Mr. Strickland to inquire.
Mr. Strickland. Mr. Secretary, thank you for being here,
and let me say that on a personal level, your responses to us
today have encouraged me.
Mr. Thompson. Thank you.
Mr. Strickland. I have a young constituent in my district
in southern Ohio. She is 31 years of age. She has been
diagnosed with chronic leukemia. Her physician says she needs a
bone marrow transplant. She has a brother who is a perfect
match.
The insurance company is saying they will not pay for it,
that it is experimental. I have talked to her physician; he
says it is the standard of treatment. I have gone to the James
Cancer Center in Columbus, Ohio, and talked to transplant
specialists there myself about her condition. They say that the
standard of care is for her to receive this transplant, and
that her chance of living and being cured is very good, given
her brother's willingness to assist her.
We need a Patient's Bill of Rights. We need a strong one.
We need it quickly. I think it is a matter of life and death.
And I just encourage you, for the sake of this woman and many
others like her, this mother, 31-year-old mother of two
children, that this administration and this Congress needs to
take these matters seriously.
I have two questions for you.
Mr. Thompson. Could I comment on those----
Mr. Strickland. Absolutely.
Mr. Thompson. [continuing] on those two things,
Congressman?
First off, I would like to--if it is at all possible, for
you to have this patient give me the information.
Mr. Strickland. I would be most happy if you would receive
that.
Mr. Thompson. I would like to have some of our doctors at
the Cancer Institute take a look at it. We are doing some
wonderful things up there. And I would like to be able to help
you. So if you could give me that information as quickly as
possible, I would like to get some doctors from our place and
see if there is a way that we can solve this problem.
Mr. Strickland. Thank you, Mr. Secretary. I deeply
appreciate your response.
Mr. Thompson. I appreciate that.
Second, on the Patients' Bill of Rights, you have got to
realize that this President passed a very comprehensive
Patients' Bill of Rights in Texas. He is in favor of it. I
passed one in Wisconsin. I am in favor of it. We need
bipartisan support.
There are two issues, scope and liability. It doesn't seem
to me to be that difficult if we are really willing on a
bipartisan basis to make some compromises to get the job done.
I am looking for you. You know, it can't only be compromised
from my side; you have got to have some compromise from your
side. And if we work together--and I am not saying that you are
not willing to compromise. I am just saying this as a example.
Let us see if we can't compromise and get a plan that all
of us can be very happy with. I agree with you. We need a
Patients' Bill of Rights, and let us get it done. Let us
compromise and do the job right.
Mr. Strickland. Thank you, Mr. Secretary.
If I can give you one other example of a constituent, and I
applaud you for your concern about organ transplant----
Mr. Thompson. Thank you.
Mr. Strickland. [continuing] concerns.
A constituent came to me. She is 64 years of age, she is on
a waiting list to receive a lung. She is covered by her
husband's Teamsters insurance. If she receives that lung
transplant prior to her 65th birthday, which is November 24,
when she goes on Medicare at age 65, Medicare will not assist
her with paying for the antirejection medications.
If she does not receive that lung transplant until November
25 when she is 65, Medicare will not only pay for the
transplant, but provide for the antirejection medication, which
is incredibly expensive.
I know this is a can of worms. I know this is a terribly
expensive thing to bring to you, but it seems so unreasonable
that a birthdate would have that kind of impact on whether or
not this woman would receive the assistance she needs.
Mr. Thompson. It doesn't make sense.
Mr. Strickland. And if we could--if we could just talk
about that and----
Mr. Thompson. I would appreciate that.
Mr. Strickland. [continuing] and work on that, I deeply--I
would deeply appreciate it, sir.
Mr. Thompson. And maybe we can work on it in the context of
reforming Medicare and prescription drug provisions. And I
would like to do that, straightening these things out.
I am looking for ideas like this in order to improve the
system. So don't be bashful about sending me these problems. We
will see if we can help you out on all of them. I mean, that is
what we are there for, to serve you.
Mr. Strickland. Do I have a minute left, sir?
Mr. Thompson. Can I just tell you on organ transplant? We
have 76,000 Americans, including your constituent, waiting to
get an organ, and only 22,000 are going to be taken care of.
Can you understand the angst and the anxiety that a person
must have, waiting to see if they are going to beat the clock
and get an organ? We need to redouble our efforts. I would
appreciate, you know, your help in developing a Congressional
Medal in which we could bring in five families from every
Congressman's district to Washington, give them a Gift of Life
Medal and highlight the need for organ donors in America.
This is too much of a great country. We are too
compassionate people to allow this problem to continue, to
worsen each and every month.
Mr. Strickland. I look forward to working with you, sir.
Thank you so much.
Thank you, Mr. Chairman.
Mr. Bilirakis. And I am hoping for a second round, Ted. I
don't know if you know that.
Mr. Buyer.
Mr. Buyer. Thank you.
Mr. Secretary, earlier in the remarks, I brought up the
issue about quality access of health care in the rural areas,
and I want to associate myself with the question and your
answer with regard to Mr. Bryant on the Community Health
Centers.
Part of the problem of getting adequate health to
underserved areas is also a lack of health care providers, and
you mentioned your concern about nursing care. If 50 percent
are going to retire in the next 15 years, we are in deep
trouble, because we don't even have--even if you packed them
all into all of those universities out there, it is still not
going to be enough. So I want to compliment you in your
oversight and what you are doing.
I would like to ask this question: Don't you agree that we
should make sure that there are no barriers to faith-based
charities serving as Community Health Centers? And how will $3
million of HHS centers for faith-based and community
initiatives work with the Community Health Center program?
Then I have a second question for you, so hold that
thought.
Mr. Thompson. Okay.
Mr. Buyer. With regard to the Nursing Home Oversight
Improvement program--this will be my second question for you--
the President's budget recommends over $67 million for nursing
home oversight.
My concern is that there is an overregulation of that
nursing home operator having Federal regulators and State
regulators. What can we do to provide relief to the
overregulation with regard to these nursing home operators and
let us really go after the bad actors?
Those are my two questions.
Mr. Thompson. First off, let me tell you that the nursing
crisis is very severe, and I am so appreciative that you raised
that question. I am very appreciative of the fact that this
Congress is concerned about it.
At the present time, we have 90,000 shortages in RNs and
250,000 CNAs that are badly needed, especially in the nursing
home industry.
And going into your last question, first, if we don't solve
the CNA problem and the RN problems, we are going to have a
severe nursing home problem in America. And whether it would be
too much regulation or too little regulation, without nursing,
you are going to have a crisis; and so we have to address that.
In regards to regulation in the nursing home industry, I
think we have to spend more time going after the bad nursing
homes and putting more investigations, more--and more sporadic,
so they are not timed; and be able to try and improve and use
the best practices of the good nursing homes and inculcate
those kinds of best practices into the whole industry.
And so that is what I intend to do and attempt to do in the
nursing home regulations.
In regards to faith-based, it still is in the embryonic
stages. We are putting $3 million in the Department of Health
and Human Services to set up the office; then we are going to
be looking at all the programs and see where the faith-based
programs could be utilized to the best. We haven't really got a
plan as of yet, because it is just getting started.
We don't have the $3 million, as you know, but I would
appreciate once the plan is further along to come over to your
office and talk to you about it.
Mr. Buyer. Would you be open to the idea or the concept of
a--if you have a particular religious organization that is also
involved in providing a health service on a community health
basis that you would include those in a community health center
funding?
Mr. Thompson. That question has not been asked. I would
like to.
Mr. Buyer. I just invite you to be open to the idea as you
are developing--you said it is in an embryonic stage. Let us be
creative and open.
Mr. Thompson. We certainly are, and we certainly will look
at that.
Mr. Buyer. Very good.
I yield back my time.
Mr. Bilirakis. I thank the gentleman.
Mr. Waxman to inquire.
Mr. Waxman. Yes, thank you very much.
Mr. Secretary, I am delighted you are here and we have this
opportunity to exchange some views.
I wanted to talk to you about section 1115 waivers. That
section of the Social Securiry Act gives the Secretary broad
power for demonstration projects and to waive various parts of
the Federal law. It is often used in Medicaid and other areas.
It has the purpose of trying to encourage innovation and
experimentation.
Mr. Thompson. Right.
Mr. Waxman. On the other hand, we do have Federal
requirements that assure us that patients, beneficiaries, get
the services that they need. So it is a concern that we make
sure that we don't waive all the Federal laws and find that we
are not getting experimentation, but regression in the
requirements. The President's budget has suggested $27 billion
will be spent in Medicaid demonstration projects in fiscal year
2001.
Now, a number of us--Mr. Dingell, Mr. Brown and I--are
sending you a letter today to request that HHS work with us on
these waiver issues to provide us with quarterly updates on
section 1115 waivers, as well as basic information on existing
waivers and demonstrations, the criteria for waiver and
demonstration approval and the assurances that beneficiaries
are adequately protected under current and future programs.
I look forward to getting your response and working with
you in this regard. I think it is important for us to be in
communication with each other as you move forward on these
waivers. You have the authority to do it, but we ought to be
involved.
Mr. Thompson. Congressman, all you have to do is call me,
and I will be more than happy to discuss anything with you and
any other member of this committee concerning waivers or
anything like this.
I want to point out that 1115 waivers, we have only issued
one. There are only 20 in existence, and there are a couple of
those I got when I was Governor, and one set up the Batcher
care program, which is, I think, heralded by you and by other
members of the committee as one of the SCHIP programs in
America.
Mr. Waxman. I think the waivers can serve a very useful
purpose. What I would like to ask of you, not just to talk to
me personally, but if we could have a process to make the
information on approved and pending waivers available to the
public to get the terms and conditions and other information
posted on the HCFA Web site, just like all the 50 States'
Medicaid programs already put this information on their Web
sites.
Mr. Thompson. I would have to consider that.
Mr. Waxman. You don't have to give me an answer now, but we
are requesting it.
Mr. Thompson. Sure. I want to work with you.
You have got to realize, I believe in waivers. I come from
a State that was very innovative in coming up and being able to
develop programs. Most of the waivers, Congressman, have been
used to expand programs to give more service to underserved
people, to children and to minorities and those that need help.
I think that States have done an excellent job. We are not
going to waive things that are going to be deleterious to the
health care of America.
But I want to work with you, and I am willing to.
Mr. Waxman. I understand we may have differences, but I
understand that you have good intentions. But what I think we
need is transparency----
Mr. Thompson. Okay.
Mr. Waxman. [continuing] and cooperation and communication.
And I would----
Mr. Thompson. I am very cooperative.
Mr. Waxman. And I would encourage that we have that.
I understand also the Bush administration is planning on
revising the Department's policy on granting section 1115
waivers for demonstrations.
Previous administrations have articulated their policies in
the various Federal Register notices, Medicaid operation
manuals, review guides, approval letters and conditions of
approval. Can you tell us whether and how you are planning on
modifying the policies that have been in place during other
administrations and whether you will solicit our views on those
as well?
Mr. Thompson. I haven't made any major changes. I may
accelerate it considerably; I don't like to delay. I like to
examine waivers and make decisions one way or the other. I
think it helps the system if you say no, to allow Governors and
other individuals to know that it is not going to go. And if it
is suitable and it is budget-neutral and we are going to say
yes, why not get it out?
Mr. Waxman. None of that is inconsistent with what I am
suggesting.
Mr. Thompson. So that is my overall philosophy. But
changing--to having a writing and any other major change at
this point in time, I haven't--I haven't made any.
Mr. Waxman. I appreciate that.
Before my time is up, I do want to commend you on going
forward with the privacy rules. I thought that was a good step
and an important one, because the American people have been
waiting a long time for some privacy protections.
I also understand you have indicated you are going to make
some modifications of those rules. The rule is designed to
respect the approach that the States have taken, even though
they may vary from one State to another.
I particularly want to know whether you are going to change
the medical privacy rule to allow parents to access their
children's health records, even in States where the policies
are to allow a minor to obtain an abortion without parental
consent.
Mr. Thompson. Truthfully, Congressman, we haven't even----
Mr. Waxman. You are not there.
Mr. Thompson. We are not there. We are not there, and it
would be premature even to attempt to answer that, because we
haven't--we haven't even published a rule. Right now, we are
looking at the guidance, not the major changes that you are
talking about.
This would be a major change. And we haven't even got to
that.
We are looking at how we might be able to put out some
guidance to solve some of the problems that Congressman Bryant
was talking about, how to solve the problem about being able to
pick up your wife's prescription drugs if she is too sick to do
it and doesn't get a chance to sign a consent, guidance on
going to a doctor, having some lab work done, being able to
allow the doctor to talk to the lab technician and get the
analysis without having to have a written consent.
Those--those directional kind of things for guidance are
the things that we are working on. And the minor changes and
the major changes, we haven't gotten to yet, and you will
certainly know when I get there.
Mr. Waxman. Thank you very much.
Mr. Bilirakis. Mr. Burr to inquire.
Mr. Burr. We look forward, Mr. Secretary, to any input we
can offer you of our expertise and experience also, as you move
through changes in the privacy.
Mr. Thompson. Thank you.
Mr. Burr. I want to as well inquire----
Mr. Bilirakis. Those mikes don't appear to be picking up.
Mr. Burr. Mr. Chairman, I think this mike is broken, but I
will try and speak loudly. I also want to encourage you where
it is appropriate to bring transparency under the waiver
process to do it; and I am confident had that existed in the
last administration you would not have inherited so many
waivers that had not been acted on; and in a bipartisan way, we
spent much of the last 2 years trying to find out the status of
waivers.
I am glad that North Carolina received its waiver on SCHIP,
because I think our program was just a little bit better than
Wisconsin's.
Mr. Thompson. That is debatable, but I know also that I am
the witness, and I am your--I will be quiet.
Mr. Burr. Ours was good enough that we still have
individuals who should be on it.
Mr. Thompson. Right.
Mr. Burr. And the Federal estimates for North Carolina had
grossly underestimated the population. And I look forward to
working with you to figure out how we can cover those children.
Let me ask you on two different areas. In the memory of Dr.
Coburn, who is no longer with us, were he to have been here,
with your statement on HIV, he would have asked you this
question: Will HHS consider on domestic AIDS policy a mandatory
testing for pregnant women so that we can detect the
possibility of transmission of HIV prior to delivery because we
know that we have medicine that can lower the incidents of
transmission?
Mr. Thompson. Let me first talk to you about the waiver
situation in North Carolina. We have pushed very rapidly on
waivers as everybody knows, and we are getting the backlog done
very quickly. Most of the waivers that we have granted have
expanded services and programs to people that need them.
And I think most of them have been widely disseminated and
been favorably accepted by both political parties. We will
continue to do that.
In regards to AIDS, we have not developed that plan and it
is something that--all of the things that you have talked about
in regards to mandatory testing are things that will have to be
considered, but at this point in time have not been.
Mr. Burr. Great. As it relates to BIPA, it mandated that
GAO study HCFA's reimbursement methodology and make those
recommendations to ensure that the methodology reflects actual
physician costs.
Even though the study is supposed to be finished, I think
in July of this year, if the study calls for HCFA to make
changes, I doubt that those changes could be complete before
January 1, 2002; and that is the implementation date of the
reimbursement reductions.
Would you consider delaying those reductions from taking
place if, in fact, that report comes back----
Mr. Thompson. Yes.
Mr. Burr. [continuing] and suggests it is flawed?
Mr. Burr. I thank you very much for your answers. I yield
back the balance of my time.
Mr. Norwood [presiding]. Thank you, Mr. Burr.
Mr. Barrett, it is your turn.
Mr. Barrett. Mr. Secretary, it is nice to see you in
Washington.
Mr. Thompson. Congressman, how are you? It is good to see
you.
Mr. Barrett. It is a lot like Elroy, would you not say?
Mr. Thompson. Not quite. Elroy does not have a stop and go
light. Elroy, if you call someone and get a wrong number, you
can still talk for half an hour.
Mr. Barrett. That is right. On this committee last year we
have had some sharp debate over the issue of organs.
Mr. Thompson. Yes.
Mr. Barrett. My sense was always that we were talking about
a pie of one size and cutting up the pieces. And if there is
anything that I have been encouraged by--and there have been
many things that I have been encouraged by--but if there is
anything in particular that jumps out with me what you have
done since you had this position is your work on organ
donations.
Because I honestly feel that you are in a position to use
your bully pulpit to travel this country and talk about this.
And I want to encourage you to do that. Because the success we
had in Wisconsin that we are both familiar with, I think, can
be replicated.
Just if you could elaborate on what you are planning on
doing, because I think you can really do some good stuff there.
Mr. Thompson. Thank you so very much, Congressman. This is
really a passion for me, and I really applaud your support and
bipartisan support, Congressman Barrett and Congressman
Strickland. This is something we need to do in America. 76,000
people are waiting for an organ; 22,000 transplants last year.
It does not look like it is going to get any better. And
what we need to do is we need to highlight it; and I have
developed a partnership with employers, like the welfare-to-
work program, that was started a couple of years ago in which
we got employers to go out and agree to hire welfare mothers.
What we are trying to do now is to get employers and with
the labor unions to team up together and make this a cause for
the workplace, to talk to employees about the importance and
the need to the giving of organs.
I am very, very proud to announce that the big three,
Chrysler, General Motors and Ford, and UAW have written in to
their contracts that they are going to do this. That is a giant
step forward.
The second thing is we are putting out a national organ
card with two witnesses; and what we are encouraging people to
do, not only sign their organ card, talk it over with your
family. Because what we are finding is that 95 percent of the
people when they are there, they will say, yes, they will
support the husband or the wife's views. But when it gets to
the hospital, only 50 percent follow through.
The third thing, based upon a Wisconsin law, as you know,
we passed the Knockrinder bill in which Kelly Knockrinder was
16 and she was very much advanced for her young age. She got
killed in a very tragic incident. Her boyfriend was driving,
she got killed; but she gave all of her organs up to help three
families. Her family came and says we should do something in
her memory, and we wrote in the Knockrinder bill in which every
person before they reach 16 and gets a driver's license has to
have a 30 minutes' study and course done on organ donation.
If we could sort off encourage other States to do that, if
we can get a gift of life medal given out by this Congress, you
know, a Congressional Gift of Life Medal, like an Olympic medal
and have five families from every congressional district come
out here with a recipient and have a day of organ donors on the
National Capital, what a great way to highlight it. Those are
the things that we need to do.
Finally, I tell people--and I am speaking all over the
country, as you probably know--and I tell people, you know, if
your organs had a vote, do you think your organs--do you not
think your eyes would continue to vote to see the beauty of
this great land? Do you not think your heart would continue to
want to beat in somebody else's body? I know your kidney and
livers would love to continue to drink Wisconsin beer and eat
Wisconsin cheese. So I know that they would vote for that. And
that is what we have to do.
Mr. Barrett. I do not disagree with that.
Mr. Thompson. We have to get that story out. I thank you
for the question.
Mr. Barrett. I need your help on something else. Twice
today you mentioned that the Patients' Bill of Rights has two
legitimate issues, two real issues: scope and liability.
Mr. Thompson. Yes.
Mr. Barrett. My concern is that there is a third, what I
have often called bogeyman, issue out there, which is that we
are somehow trying to nail employers. And we need your
leadership on this issue, because I do not know anybody who is
pushing this legislation who wants employers to be held liable.
And, again, twice you identified what I have said when I
have businesspeople from Wisconsin come into my office. I say,
there are two legitimate issues here, the scope and the
liability. You have echoed that today.
So I think you could advance this debate much further if
you sent the word out to the business community we are not
talking about employer liability here.
Mr. Thompson. I am willing to do that.
Mr. Barrett. Good. The third, I was in Marshfield last week
at St. Joe's Hospital and they were talking about diabetes and
the concerns there.
Just briefly if you could talk about what you are planning
to do, because what you mentioned today about diabetes was
something that was mentioned in Marshfield last year.
Mr. Thompson. I went down to CDC, Congressman, and the
experts down there tell me that 75 to 80 percent of diabetes
can be controlled or eliminated by doing two things: eating
properly, life-style change and exercising.
Now, if we were able to motivate America about smoking,
what an impact we could have on the Medicare dollars, the
Medicaid dollars, and the health care dollars in America, if we
could somehow get the information out about life-style and
about exercise.
And I think this Department, the Department of Health and
all, should be leading the effort in that. We want to develop
programs and preventive health, especially in diabetes.
I am looking for ideas. I do not have any. And I am looking
for ideas from you, Congressman, to find ways in which we can
do that. I do not know if the 75 to 80 percent figure is
correct. But if it is only 50 percent, what a tremendous impact
we could have on the health care of America if we just did
that.
Mr. Barrett. Thank you.
Mr. Norwood. Thank you, Mr. Barrett.
Mr. Whitfield, I believe it is your turn.
Mr. Whitfield. Thank you very much. Mr. Secretary, welcome
to the committee. We are all delighted that you are in your new
position of responsibility.
Mr. Thompson. Thank you.
Mr. Whitfield. Last month, Rose Crum-Johnson, who is the
Region IV administrator for HCFA, was in my district and helped
us arrange a forum for health care providers to express their
frustrations with reimbursement issues; and we had over 120
providers there. There was about a 2- and a 3-hour--2- to 3-
hour question and answer series, which I think went very well.
I hope as you address these issues of reform internally
that you might at least consult with her, because she may have
received some insights from that forum that could be helpful.
She did a great job, and I must say very frankly that we
were not nearly as impressed with the contractor for that
region as we were the HCFA personnel that were there.
The second thing, we have heard a lot of discussions today
about Patients' Bill of Rights, and all of us obviously want a
Patients' Bill of Rights. I, for one, am pleased that the
administration is taking its time, particularly on the
liability issue, because anytime you talk about preemption of
ERISA, there is a problem with employer liability.
I know that--we know for a fact there is some
reentrenchment on health care benefits from employers, and the
last thing that we want to do is pass a bill that is going to
create more uninsureds. So I am delighted that the
administration is moving forward cautiously on Patients' Bill
of Rights.
Mr. Norwood. The time is up.
Mr. Whitfield. I want to talk to you about the issue of a
nursing shortage. There has been some legislation regarding
that and Lois Capps and others are involved in that. And I
think we would like to get our legislation over to you and let
you all look at it and see if you have any suggestions and see
if we can work together to try to move that legislation.
Mr. Thompson. I would like that very much, Congressman.
Mr. Whitfield. On the fourth issue, like everyone else, I
am very much interested in this Community Health Centers. It is
frustrating to see people who are just over the line, they are
not eligible for Medicaid, and they are paying taxes for
Medicare and Social Security and Medicaid for other people; but
they are not receiving any benefit.
And as we look for ways to address this uninsured pool--
obviously, Community Health Centers is one way to do it. Other
ways are health marks, tax deductions, tax credits for health
care premiums and so forth.
Do you all at HHS have any sort of task force that is
looking at ways that we can address this uninsured problem at
all at this time?
Mr. Thompson. We do not have a task force, but we certainly
are looking at it. We are looking at Community Health Centers
as you know. We are looking at the Presidential tax credit that
he wants. But we are always--we do not have to have a task
force to be looking at. We are looking at ways to improve it
and make more people eligible.
The working poor that you are concerned about is something
that, you know, I was very concerned about as a Governor; and I
always felt, you know, that people on the Medicaid end of the
spectrum were able to get very good medical care. People that
were middle income to wealthy were able to get good medical
care.
It was the poor working person that was just above the line
that worked very hard that could not afford health insurance;
and that is when we decided to work on Badger Care in
Wisconsin. And I am sorry the gentleman from North Carolina is
not here; I would like to tell him how much better tragic areas
than his program in North Carolina is but----
Mr. Whitfield. I will tell him.
Mr. Thompson. You tell him that I said that, but I waited
until he was out of the room. I want to be helpful, and this
Department wants to be helpful. We would like to be able to
reduce the number of uninsured and increase the number of
people that get health coverage.
Mr. Whitfield. But you see the Community Health Centers as
one of the primary ways to do that?
Mr. Thompson. I see it as an excellent way to do it.
Mr. Whitfield. And I am not sure on eligibility
requirements for Community Health Centers, but is there some
sort of sliding scale based on income to be eligible?
Mr. Thompson. There is. And usually in the Community Health
Centers that you fill out a form, and the ones that I am most
familiar with, you have to pay something. You have to pay
something toward it, but it is based upon your income. It is
affordable, but the concept has been that you should pay
something to go in there.
Mr. Whitfield. And the $124 million that you are
requesting----
Mr. Thompson. $124 million.
Mr. Whitfield. [continuing] how many centers do you
anticipate with that?
Mr. Thompson. We want to be able to increase the number of
centers by 1,200 over the next 5 years.
Mr. Whitfield. Okay.
Mr. Thompson. And this is the first installment, so it
would be about 300.
Mr. Whitfield. Mr. Chairman, thank you for giving me the
time.
Mr. Norwood. The last time, thank you Mr. Whitfield. Mr.
Wynn it is your turn.
Mr. Wynn. Thank you very much, Mr. Chairman; and welcome,
Mr. Secretary.
Mr. Thompson. Thank you, Congressman.
Mr. Wynn. One of the things I am very pleased about is that
you bring enthusiasm to the job, and I think that is the first
and the most important prerequisite.
Three issues. First, this is a picture of Melissa Forelich.
She is a poster child for the Red Cross. She is here with us
today with her mother. She is a victim of congenital heart
defect.
Also with us is the family of Samuel Ellison. His parents,
Marcus and Vongi Ellison, are here. My colleague, Ms. Morella,
and I are going to sponsor a bipartisan measure that would
propose a Medicaid waiver for families such as these so that
they would not have to be doomed to poverty as a result of
addressing their child's health care problems.
This waiver would kick in after all of their private
insurance has been exhausted. I wanted to somewhat vividly
illustrate this point, because I hope that you can consider
supporting this legislation. I think you are well aware of the
problem of congenital heart defects, such as there are multiple
operations over the child's life, even beyond the age of 18.
And under the current Medicaid laws, these parents, these
families would have to literally spend down to poverty and who
would otherwise be productive tax-paying citizens would
basically have their lives substantially destroyed.
I hope you will consider that and maybe even if you have a
moment to talk to the families who are here.
Mr. Thompson. I certainly would like to. And I am very
appreciative that they are here, and let us hope that we can
help them.
Mr. Wynn. Thank you, Mr. Secretary. Second is Head Start. I
noted that you say that you are going to be able to serve
915,000 young people in Head Start. With $125 million increase
out of a budget of $6.3 billion, that seems somewhat modest;
and I would like to know how many young people are eligible
beyond the 915,000, because I got the impression that there
were probably another 40 million who might be eligible who are
not served; and it would seem that we ought to be able to find
the money to serve them.
Third, I had an interesting conversation--first of all, let
me commend you in this context about your commitment about
preventive care. I had a conversation with some State
Department folks on the subject of Cuba, and they begrudgingly
admitted that Cuba had addressed the problem of preventive
health care. Obviously, it is a different system; but I feel
bad that our system has not been able to do as good a job as we
think we ought to do in that area.
My colleague, Mr. Whitfield, mentioned Community Health
Centers. It seems to me that is a move in the right direction.
I would like you to amplify on your thoughts on that with the
eye toward how can we do this in the most direct way so that
there is not a lot of insurance or tax papers and things like
that so that the people can go in, get preventive care, and we
can in turn get the savings of having them healthier.
If you could comment on those latter two issues, I would
appreciate it.
Mr. Thompson. Well, preventive health care is something
that, you know, we need to do in America. Our health system is
set up, Congressman, to wait till a person gets really sick,
then we pay lots of money to correct it.
Mr. Wynn. And ask them if he has any insurance.
Mr. Thompson. And ask them if he has any insurance. I
started a program back in Wisconsin and invested $150,000 a
year for the abatement of lead poisoning, and a community--
through a community health center. And then 5 years for an
investment of $750,000, we were able to reduce the lead
poisoning in that census track by 60 percent.
Now, what that means is that we have probably saved the
Medicare and Medicaid budgets thousands, possibly millions, of
dollars; but the more important thing is that we gave young
people, especially minorities in that census track, an
opportunity to lead, you know, successful lives instead of
having lead poisoning.
Diabetes, it is so important for us to get out information
on obesity, nutrition, and exercise in order to do that.
I am looking for ideas, because I want to try and focus
Congress and America on ways that we might be able to be a more
healthy society and be able to change the reimbursement systems
toward more prevention.
And I need your advice and ideas on how to do that, because
I am there, I know the problem; but I do not have the expertise
to bring all of the ideas together without some assistance from
Congress and so on. But I think we need to do that.
In regards to your waiver, if you are going to have to pass
legislation, we would be more than happy to look at it. Once
you get it drafted, send it over, we will make some contact--
some comments and look at it.
As far as community health, it is a wonderful way, you
know, to get minorities, underserved people in urban areas, as
well as in rural areas to get the necessary health care
coverage that they need.
This is probably the first avenue for health care for
millions of Americans; 11 million are being taken care of right
now. We would like to expand that up to 20 million. We would
like to expand the number of Community Health Centers by 1,200,
which is a laudable, but ambitious, goal. I am appreciative of
the fact that we are having bipartisan support for that.
Mr. Norwood. Thank you, Mr. Wynn. We will have a----
Mr. Wynn. My time has expired.
Mr. Norwood. Yes, it has. We will have a second round.
Mr. Norwood. Mr. Secretary----
Mr. Greenwood. Mr. Chairman.
Mr. Norwood. I'm sorry, Mr. Greenwood. I beg your pardon,
sir. You are absolutely recognized.
Mr. Greenwood. Thank you, Mr. Chairman. It is not your
fault; I was entertaining 50 ninth graders downstairs. I had to
leave. They had some tough questions; you think you got tough
questions.
Mr. Secretary, you and I spoke yesterday briefly in my
office about privacy issues. And as you understand the privacy
rule that I had some problems with in the last administration,
I have some problems with in this administration. We talked
about maybe working together to correct some of that.
I want to ask you two things, but they are very related;
and they have to do with privacy and computers.
The health entities that will have to comply with these
privacy regulations will have to redesign their computerized
health information systems in order to do that, and that is
going to be very expensive.
Mr. Thompson. Yes.
Mr. Greenwood. They also, pursuant to HIPAA, will have to
make similar changes to comply with the rule when it is
finalized on security and electronic signatures.
And one of the expressions that they have made is that the
problem that they have is they are going to have to go in and
justify to their boards of directors the expenditures for the
revamping of their computers to meet with the privacy--to meet
the privacy standards and then wait until the second set of
rules comes out on security and electronic signatures and maybe
have to go back and do it again, and that it would make a lot
of sense in terms of costs to synchronize those two actions to
be able to take care of them at the same time.
So part one of my question is, do you think we can figure
out a way to blend, merge those two calendars so that they have
to comply with both of those rules so they would know what the
new rule is in time to comply with both of them at the same
time?
Similarly, another privacy and computer issue goes to the
other direction, and that is----
Mr. Thompson. Congressman, could I just interrupt before
you ask me the second question. You know that the privacy
effective date is statutory. I have no way to extend it at all.
That is written into the law. You will have to----
Mr. Greenwood. I think what we will probably have to do is
to see what the fastest route you think is to the security and
electronic signature rulemaking and see whether you can do that
fast enough so that the two can be synchronized or whether we
need to make an adjustment in the privacy piece----
Mr. Thompson. All right.
Mr. Greenwood. [continuing] statutorily, if necessary, to
push that out a little bit further, so you can catch up with
the other piece. I look forward--you do not even need to go
into much more detail than that right now.
Mr. Thompson. Okay.
Mr. Greenwood. But I would like to work with you.
Mr. Thompson. I appreciate your comments on that and would
like to work together with you on that.
Mr. Greenwood. The second issue related to computers and
privacy, as I said, goes the other way, and that is, although
the information that your Department has is very personal in
nature----
Mr. Thompson. Right.
Mr. Greenwood. [continuing] particularly over at HCFA. We
have been holding hearings in my subcommittee in oversight
investigation into cybersecurity of the Federal Government. We
found some pretty alarming information out about how frequently
hackers are trying to get into your systems and all of the
Federal Government's systems and how frequently they succeed.
There was a recent Inspector General report that found
numerous general control weaknesses primarily at HCFA's
Medicare contractors. Such weaknesses do not effectively
prevent, one, unauthorized access to and disclosure of
sensitive information; two, malicious changes that could
interrupt data processing and destroy files; three, improper
Medicare payments; and, four, disruption of critical
operations. So there are vulnerabilities at HCFA that the IG
found there. We will be having a hearing soon to have some of
your folks come and talk about that.
Have you had a chance in 75 days to become aware of this
issue?
Mr. Thompson. Yes, I have.
Mr. Greenwood. And if so, what do you think you can do
about it?
Mr. Thompson. First, let me compliment you on holding the
hearings. I think it is absolutely vital that we get more
information out there about the security of our computer
systems and how we might be able to make them more secure.
We are asking, I believe, $30 million in our budget for
that particular issue, to correct that problem. And HCFA, of
course, is the big one because that is where the computers are
and that is where most of the information is. We are looking at
that. They have a task force working on how they can continue
to improve. And I think they are doing a fairly good job of it,
but we need the $30 million to submit it.
But in the meantime, we want to work with you and your
staff and your subcommittee on this; and I just would like to,
once again, say and reiterate that we are appreciative of the
fact that you are holding hearings on this thing, and let us
see if we cannot correct it. It is a problem.
Mr. Greenwood. I appreciate that. I have seen HCFA's
computers. They look pretty fancy; but I think they are pretty
old, as you mentioned.
Mr. Thompson. They are actually 31 years old, and it is
absolutely amazing to me that HCFA is still operating a
computer system.
Mr. Greenwood. I, for one, will be supportive of the
requests for the $30 million. Thank you.
Mr. Thompson. Thank you very much.
Mr. Norwood. Thank you, Mr. Greenwood.
Mr. Secretary, in your written statement you indicate that
there should be some changes in the medical privacy rules that
are put out, and I do not want to sit here you and ask you--I
do not think it is fair to ask you at this point what those
changes should be.
I want to encourage you to work with the health
subcommittee, because we are vitally interested in it.
Mr. Thompson. I know you are.
Mr. Norwood. I want to point out to you that when the
Government has rules or laws that they produce and it falls
down on the provider to choose between obeying that rule in law
versus good care for the patient, that is a very difficult
place to be.
And some of these rules interfere with good patient care;
and what we do is if we allow that to stay, of course, we turn
them into criminals, because they have chosen not to follow the
rule versus doing what is best for the patient. And I know you
will consider all of that, but we are all really interested.
I was not going to ask you any questions about patient
protections; but my good friend over here, Mr. Pallone,
stimulates me, usually; and, therefore, I need to just make a
point or two with you about that.
Mr. Thompson. Thank you.
Mr. Norwood. And I would like to defend the President. If I
were President, I would sign the Ganske-Dingell bill today.
Now, I say that saying I know that it is not perfect. I know
that if we got there over 6 years of difficult work--and I
think it may be the best we can do to achieve the goals of
protecting patients--but if I were the President and I had been
in town 100 days, I am not sure I would not want to sign it
without trying to make it more perfect.
I want you to know, and everybody in this audience, he is
doing that. To say that he is ignoring this subject is not
correct.
Mr. Thompson. He is doing that.
Mr. Norwood. I know for a fact that they are working very
hard on that; and our differences are very, very, very slight
at this point. There is no reason we cannot this summer, I
believe, get a patient protection bill out, maybe even spring.
But you pointed out that there is still two areas of
concern: one is scope, which means how many Americans are going
to be covered under this bill, and the other is liability.
I think those differences, though, are not that big. This
President is on record saying that he wants every American
covered. Now, that tends to take care of scope.
It comes down to how hard is it to get every American
covered, how difficult do you make it; but when you say that we
want every American covered, which he did say in his debates,
that means every American, including the teachers and the
firemen back home. So there is no reason we cannot come to an
agreement, I believe, on scope and at the same time try not to
run roughshod over the laws of this country that you so
delicately helped put together.
The other thing is about liability. This President is on
record saying that he believes any bill we produce should have
liability. The Congress is on record in the ranges of 98
percent saying we should have liability, whether they voted for
it through the Norwood-Dingell bill or whether they voted for
it through the Coburn bill or whether they voted for it on the
Senate side through the Nickles bill. Almost everybody in
Congress and this President says that we need to have some form
of liability.
Now, do you have any suggestions how we get over that
hurdle? Why is that--why does that still seem to be the
difficult problem as to the liability section in that we all
agree that there should be liability? Can you bring--help me.
How do we get around that problem, since we all agree anyway?
Mr. Thompson. I think it takes a lot more discussion. I
think it needs good people like you, Congressman Norwood, and
Congressman Ganske to sit down with people that are lobbying
this in the Senate side, and also people that are working on it
in the White House; and I want to be helpful as you do.
Mr. Norwood. I know you do. That is the reason I am asking
that question. I know the President wants us to get there
badly.
Mr. Thompson. And the President is, you know, has indicated
that he--the President really wants a Patients' Bill of Rights.
He wants one that works and so do you and so do I.
Mr. Norwood. I know.
Mr. Thompson. I think there are ways to do it. I think we
are just talking at each other and not--and not trying to sit
down and solve the problem. I think we need--we need a couple
of good afternoons in which we can lock the door and just roll
up our sleeves and just get it done.
Mr. Norwood. I have had that afternoon every week for the
last 8 weeks, and we still--we really are there. It is just
that one little arena, whether we go to Federal court or
whether we go to State court.
Mr. Thompson. Can I be helpful?
Mr. Norwood. Perhaps when we have our visit, we can talk
about that.
Mr. Thompson. Thank you.
Mr. Norwood. And I yield back my time and the chair.
Mr. Thompson. Thank you, Congressman Norwood.
Mr. Bilirakis. Mr. Brown to inquire.
Mr. Brown. Thank you, Mr. Chairman. I, again, apologize for
the rudeness of going downstairs and voting and leaving. I do
not like doing hearings this way, but--so that is the way that
happens sometimes.
You made a comment in the South Florida Business Journal
recommending a change in the entire culture of antibiotic use.
Thank you for that comment.
As you know, the Department of Health and Human Services
and the Centers for Disease Control and other agencies issued
an action plan--released an action plan to talk about
antibiotic resistance in four fronts: surveillance, prevention
and control, research and product development.
Will that serve as the blueprint for your administration's
attack on antibiotic resistance?
Mr. Thompson. I would say absolutely. I do not know why it
would not.
Mr. Brown. Okay. I think it would and I talked--Chairman
Bilirakis and I are working on some legislation to authorize
funds to implement it. And it is--I know there is a hundred
things to----
Mr. Thompson. If you could, Congressman, you know, bring us
in, and, you know, as you are developing this legislation, we
would love to work with you and see what we can do.
Mr. Brown. I very much appreciate that. Let me talk about--
the people were mentioning situations in their districts and
this is a larger problem than that; but it is very--it is
crucially important to a thousand families in the eastern end
of my district, near Warren, Ohio, where a steel plant closed.
They are not eligible for COBRA, because the plant declared
bankruptcy. They did not just close one plant; the whole
company declared bankruptcy. They have been told that they
need--they have been offered insurance, many of these families,
for about $1,200 a month. I mean, it is extraordinarily
expensive. That may be more expensive than some other places
and may not be in every case.
But the tax credit that the administration has proposed is
a $2,000 tax credit, but that is the bad news. The good news,
and Congressman Barrett told me about Badger Care, and I read
about Badger Care in other places. When you were Governor, you
used very efficiently and effectively public programs, Medicaid
chip, Badger Care, those kinds of things, that have a proven
track record of getting the job done.
The Senate--the Senate budget resolution included a
bipartisan amendment, Senators Wyden and Smith from Oregon
dedicating $28 billion to the constituency fund, not using tax
credits but using health coverage, health insurance coverage
expansion through program expenditures.
Is that not how we move toward universal coverage? I mean,
talk to us for a moment, if you would. With 40 million people
uninsured in this country, the number is surely going to get
larger as we see these layoffs. Will you support that Smith-
Wyden resolution? Will you come down on the side of using
public dollars in addition to tax credits where we really do
not have the insurance reform that allows tax credits to take
care of people when insurance is so much more expensive than
the tax credits we seem to offer?
Mr. Thompson. Congressman, I do not think you have to have
one over the other. I think, you know, if we are--if we really
want to address the uninsured issue, which I know you do and I
do, you have to look at a whole plethora of ways to do it.
Community Health Centers is the President's primary way of
doing it, along with tax credits; and even though you can make
the argument that $1,000 and $2,000 refundable tax credit is
not enough, the truth of the matter is, it does defray a
portion of the health insurance, if not all, part of it, which
is a good inducement for doing it.
We think--our analysis means that 6 million more Americans
will be covered by it. The third way, which we did in
Wisconsin, which was very effective, was expanding the SCHIP
program and developing a new program called Badger Care; and a
lot of people have indicated that that program is one of the
best programs for uninsured, the working poor, in America.
I cannot certainly--I certainly cannot sit here and say I
am not going to be supportive of that, because I am. But if you
are going to have an expanded SCHIP program and it is
expensive--and I do not know where that money is at this point
in time--but we are looking at waivers. We are looking at ways
to do that.
I would appreciate working with you on this along with
Chairman Bilirakis.
Mr. Brown. Okay, good. Thank you. The last--more a
statement than a question, I have been very pleased, as Mr.
Wynn said, your enthusiasm to do new things and try new things
and make things work in that Department.
Mr. Thompson. Thank you.
Mr. Brown. And I have been real pleased with a great
majority of your answers. One I wanted--I was a little confused
on the questions Gene Green asked about the Centers for Disease
Control. I just think that this country--a physician told me
the other day that we are about 5 percent of the world's
people.
We consume almost 50 percent of the world's health care
expenditures. We are pumping huge amounts of money into NIH,
which I believe, as I think Mr. Strickland said, everyone on
this committee agrees, what Mr. Green says, everybody on this
committee agrees that we should do that, but we are
shortchanging CDC.
And when you said that--when we are talking about diabetes
and obesity, research is great, and we support that; but to cut
the prevention and the CDC efforts on public health, I mean, we
put so much into high-tech medicine, which has worked to help
people live longer in this country. But the real advances for
life expectancy have come from public health, from everything
from buying antibiotics to preventive care, to a better
understanding of tobacco and alcohol and safe drinking water
and all of those things; and those are CDC kinds of things.
And I would hope that you would reconsider, and
understanding you put a lot of money into research, but please
also do something more with CDC so we can do better on the
prevention side.
Mr. Thompson. I happen to be a big fan of what is going on
in CDC. And I have been done there, and I do not know if you
have been done there or not. I am sure you have, Congressman.
It is a wonderful place, and they do great things.
Most of the reduction in CDC was out of the $125 million
for the youth awareness program, and that was Congressman
Porter's program that went in for more publicity of getting a
program out for healthy life styles for our young people, which
is laudable.
But we just felt as an administration that we got some
problems that we wanted to--we thought a better investment of
the dollars, the financial resources was in NIH for research.
You know, you can question that decision; but the decision
is based upon what we think is the best, getting the best bang
for our dollars instead of spending $125 million for publicity,
put the money into research.
We also increased the amount of money for chronic diseases,
I think, by almost 11 percent in research. That is a huge
increase. It is over a $600 million increase for that kind of
program. We are not saying that CDC was not doing a good job.
We just think it was a better investment.
Mr. Brown. I think--and this might sound a bit a more
partisan--but I think when we look at--those are great. I mean,
we all want you to do with NIH.
But when I came to this Congress, the NIH budget was $12 or
$13 billion. The CDC budget was, I do not know, 2.5, maybe. Now
the CDC is somewhat over 3 and NIH is up over 20, which is
great for NIH.
But we really do--we have this kind--we have an opportunity
in this country now with this surplus to do something better
with public health, and I wish we would have the same
commitment. We talked about doubling it. We all stayed with it,
doubling the NIH budget over 5 years.
I wished we would have a similar kind of commitment to do
something, something bold with CDC. And I would hope--you have
a reputation as a guy that really cares about public health in
Wisconsin. And I hope that you can--even though some people
that might be above you in this business--in our committee, I
guess, but a couple of people above you may not have the same
interests in public health as you do. But I would hope that you
would in these meetings speak out for what you really do care
about. Thank you.
Mr. Thompson. Thank you. As you probably know, I do.
Mr. Bilirakis. The Chair thanks the gentleman. And I think
to support your last statement that the previous administration
for chronic disease prevention health promotion requested $385
million last year, and under this budget, these programs would
receive 190 million more dollars over that request, which is an
increase of 49 percent.
So I think that is an indication that you do care about
chronic disease prevention and health----
Mr. Thompson. Thank you.
Mr. Bilirakis. [continuing] promotion program.
Mr. Secretary, I commend you, I thank you, whatever,
regarding Community Health Centers. Mr. Waxman knows--over the
years he so very ably chaired this committee--and I know how
strongly I feel about that particular subject. He is still
there. And I commend you for the additional dollars and the
emphasis on this.
Getting to the National Health Services Corp.'s
reauthorization, the way--the way NHSC works now--and I do not
think this has changed in the last couple of years--is a person
can get out and maybe get himself or herself based in one of
these underserved locations where they are direly needed, and
then pick up an offer from a large health care firm that offers
to buy out their contract. Apparently, they still can do that.
Frankly, I have problems with that, and I just wonder how
you might feel about that subject and how you might feel about
possibly our legislation preventing that from taking place. I
mean, these people have entered into a contract where the
taxpayer is taking care of the health care--I mean, their
medical education, and then they decide--because with or
without big dollars to be able to buy out of that contract. I
have problems with that. Any comments?
Mr. Thompson. Mr. Chairman, I have to confess I have not
looked at that issue. I have not looked at your legislation. I
guess I should have realized that problem was there, but I have
not really addressed it.
Mr. Bilirakis. I think it is a problem. I know that an
awful lot of areas lose an awful lot of needed people, as a
result of the big dollars coming in from some of these----
Mr. Thompson. I would like to take a look at your list and
work with you on it. And, you know, coming from a poverty area
myself in rural Wisconsin, you touched the right strings for
me; and we are an underserved area where I personally live, and
so we need to get as much--we need good health care there as
well as you do in your area.
Mr. Bilirakis. Yes. And we would all like to--Mr. Brown
emphasized the uninsured--we would all like to do something
about the more vulnerable members of our society in some way. A
few years ago, a group of us got together on a bipartisan
basis, and we thought we were doing that; but that legislation
did not get anywhere.
But until that happens, we need the Community Health
Centers desperately, and we still might continue to need them;
but we need them desperately. And we need, I think, the
National Health Service Corp. desperately.
Mr. Thompson. I applaud your passion for them. They do a
great job. I mean, $11 million--most of the Community Health
Centers is the first avenue for a lot of underserved people to
get medical care.
Mr. Bilirakis. Yes.
Mr. Thompson. And I applaud the President and this
committee for being so supportive of that.
Mr. Bilirakis. I will yield back the balance of my time and
recognize Mr. Pallone for a second round.
Mr. Pallone. Thank you, Mr. Chairman.
I wanted to ask you, Mr. Secretary, about the Indian Health
Service, which is a concern that I have. Myself and Mr. Miller
and Mr. Hayworth on a bipartisan basis, we are about in the
next few weeks to reintroduce the Indian Healthcare Improvement
Act, which seeks to reauthorize and improve upon the existing
Indian Health Service.
I just wanted you to be aware of the fact that we were
doing that.
There is a great deal of concern among tribes about
disparities, if you will, between health care provided to
American Indians to the rest of the population; and that is
basically what we are trying to address with this legislation.
When you talked about diabetes in particular, I was
thinking of American Indians, because it is unbelievable the
epidemic that we are witnessing now with diabetes. And,
although, you know, they are happy over the fact that there is,
I guess, $100 million that was appropriated or, you know,
budgeted, appropriated a couple of years ago with regard to
diabetes for American Indians, I noticed that the budget
actually just leveled funds for diabetes programs for American
Indians.
I would like to see more money go to it, particularly for
prevention. You mentioned prevention, and I am totally
convinced that that is the answer with regard to diabetes in
American Indians.
Mr. Thompson. So do I.
Mr. Pallone. We actually had a few forums on the Health
Care Improvement Act, and we went to some of the reservations,
and one of the ones that I visited was the Tohono reservation
in Arizona, which now the majority of the tribe members
actually have diabetes, adult onset of diabetes.
There are people there who--there is actually a program
there where they would like to use prevention, diet, in
particular, as a way to try to prevent that. So maybe I will do
a follow-up letter.
But I would like you, if possible, to see more money for
diabetes prevention with regard to tribes and also see if maybe
we can do some kind of pilot program looking at diet as a way
of trying to deal with the problem. And I was hoping maybe I--
we could have a meeting maybe with some of the Commerce members
and staff to talk about the Indian Health Service. I want to--
--
Mr. Thompson. I would like to do that.
Mr. Pallone. If I can get back to you about that, I would
appreciate it; and we would show you the bill.
Mr. Thompson. I would like to do that.
Mr. Pallone. In addition, at some point, I am hoping after
we introduce this that we can get this subcommittee to have a
hearing on it, and I will talk to my leadership about that here
in the future.
Mr. Thompson. No, if you want to get a group together and
talk about Indian health, I would like to.
Mr. Pallone. I appreciate that.
Mr. Thompson. I would appreciate getting a copy of your
legislation, and so I get a chance to review.
Mr. Pallone. We will send it to you. Thank you. I wanted to
follow up on what Mr. Brown and Mr. Waxman said, though, with
regard to the SCHIP program, because I know that you mentioned,
you know, the question of funding, in other words, you know,
how do we expand SCHIP unless we have significant more funding,
and that is a concern I have.
You talked about the waivers. As you know, New Jersey has
one of the these waivers also, and we have been now covering
adults as part of the SCHIP program as well. But I know from my
own State that there is a tremendous demand, and there would be
a need for a lot more money even in New Jersey to expand SCHIP
to cover family members as opposed to children.
What I do not want to see is that, you know, in expanding
it to cover adults, which I think is a good idea, that we cut
back or have waiting lines for children. I do not see a
significance amount of money--I do not know if there is any
increase, but certainly enough extra money in what the
President proposed to actually expand SCHIP in a major way.
You sort of suggested that, I think, that that is the case
in response to Mr. Brown's question. And I was just wondering
then why does the--you know, why does the administration not
simply support what Mr. Wyden and some of the other Senators
did when they voted for this larger sum of money to cover the
uninsured.
In other words, could that not be used, if the
administration was willing, to cover more uninsured to expand
the SCHIP program?
See, I guess my problem--I would like you to answer the
question; but my problem is, as much as I support Community
Health Centers, I still think it makes a lot more sense for us
to cover people who are uninsured, and I think that is a lot
more effective than it is to expand Community Health Services,
albeit I would like to do both. But I just do not see where the
money is going to come from, and I certainly do not want to see
any cutback in services for children.
Mr. Thompson. You have raised a lot of issues. Let me try
and tick off as many as I can. I do not think by expanding the
program to adults that you are going to reduce the number of
children that are going to be enrolled. I think just the
opposite happens.
I think the studies have shown that if a low-income family
is able to enroll as a family, you will have more children
enrolled with their parents than if you just have the children
enrolled.
Mr. Pallone. I agree with you. And my only concern is that
I am afraid that if there is too much expense, that some of the
States may end up cutting back on the kids. Because it is a
block grant, they are not told by you what to do. Right?
Mr. Thompson. Well, there is a prohibition from doing that
right now in the statutes. You have to get a waiver in order to
do that.
Mr. Pallone. No, but I am saying it is possible that some
States could, in expanding, cut back on the number of kids or--
--
Mr. Thompson. It is possible, but most States are looking
at ways to expand. I mean, most States are doing an excellent
job; and that is why the waiver program has been so effective.
In regards to costs, in regards to costs, Mr. Pallone, you
know, this President has treated us very equitably. My overall
budget for the Department of Health and Human Services is going
up by $436 billion to $470 billion, an 8.2 percent increase.
The discretionary funding is going up by 5.1 percent when the
overall budgets have been limited to 4 percent. So HHS has been
treated fairly.
Next year, I think you are going to see--if we can reform
Medicare this year, I think next year, hopefully, it is going
to be a reform of Medicaid, if we can get Medicare done this
year. And I think then the issue of expansion of SCHIP is a
program that we should look at very seriously. And that is what
I was referring to to Mr. Brown.
I said costs, but it really is one of delay, that we should
take a look at this in the context of Medicaid reform, which I
hope we can look at next year after we get Medicare done.
Mr. Bilirakis. The gentleman's time is expired.
Mr. Pallone. Thank you, Mr. Chairman.
Mr. Bilirakis. Dr. Ganske.
Mr. Ganske. Mr. Secretary, I think that Medicare reform is
important in that we need to help make the system function more
efficiently; but I have serious concerns about whether
realistically Medicare reform, is going to provide much in
savings.
And here is why: I think you would agree with me that while
there is some abuse in Medicare/Medicaid, it is small. It is
watched over by Governors.
We have had several congressional hearings. You are never
going to effect the type of savings from further clamping down
because you reach a certain level where the costs of the
oversight equalize the costs of the benefit from the oversight.
And I would say this, in looking at Medicare and Medicaid
recipients in Iowa, I am sure it is the same as in Wisconsin. I
just do not see very many people receiving unnecessary care,
unless you want to get into issues of euthanasia, end of life.
And I would certainly say--and I would be interested in your
opinion on this--I do not think Medicare providers and Medicaid
providers are overly compensated, do you?
Mr. Thompson. I really--you are asking me a question. I do
not think so. But I have no empirical data.
Mr. Ganske. Well----
Mr. Thompson. I would think that the Medicare and Medicaid
system is based upon reasonable reimbursements, and that is
what it was set up to do. I do not think anybody is getting
overly rich on this system.
I think some people, you know, may have used the system
unfairly or maybe even illegally have gotten more money than
they deserve; but the honest practitioner, like you and other
people in your capacity, no, I do not think so.
Mr. Ganske. So my point is this, if there are not very many
Medicare recipients getting unnecessary care and if the costs
of the care, by and large, are fair, then the only way you are
going to achieve significant savings is basically to tighten
rationing and decrease necessary care. That gets me to the
issue----
Mr. Thompson. I am not ready to buy that conclusion,
Congressman. I am willing to work with you on it. I am willing
to say that there are savings to be had within the system. We
have not really addressed those; you have not as a Congress,
and I do not think we have as an administration yet. And I
think we need to do that. I think we need to explore those
possibilities and see if there are some meaningful ways to save
costs without rationing services.
Mr. Ganske. If you accept the premise that people are
receiving necessary care and are not overreceiving care and
they are being paid at a reasonable level as the system is now,
then it gets me to the point I wanted to get to, and that is,
you are either looking at adding a benefit, like prescription
drug or addressing the inequity in the payment schedules that
we see for certain States like Iowa, Wisconsin, or you are
going to have to bring in some additional revenues. You cannot
rely on the trust fund.
Because if you rely on the trust fund, you are just going
to shorten the life of the trust fund. As I look at a
prescription drug benefit, just like any other benefit, there
has never been a benefit added to Medicare that has saved
money. But the prescription drug benefit could cost easily $300
billion or $400 billion over 10 years, if it is structured as
either the Democrats or the Republican bills were last year.
If we do not pass a comprehensive benefit and a Medicare
reform bill, then I would like you, Mr. Secretary, to look at a
bill that I have introduced which would basically provide help
for those in Medicare that are not in Medicaid, they are not
supported in Medicaid, but are truly needy, the Qualified
Medicare Beneficiaries and the Select Low-Income Medicare
Beneficiaries and allow them to utilize the State Medicaid drug
programs, but pay for it from the Federal side. So we are not
asking the Governors to come up with additional funds, but we
take advantage of the types of savings that Governors around
the country have utilized in terms of their own prescription
drug programs as they have related to Medicaid.
So we do not have to reinvent a wheel; it is there already.
It would be simple. It would allow people to utilize a program
that is already there. In fact, it might even help Governors in
terms of their negotiations with their various health plans.
And I think that this would be preferable to a so-called
Helping Hand program, because you have a State Medicaid program
set up in every State already. I just wondered if you had any
response to that.
Mr. Bilirakis. Very, very quick response, sir.
Mr. Thompson. I would love to look at it. I would like to
say that the President meeting Helping Hand is 100 percent
federally funded; and that is the one that, you know, that I am
most familiar with, but I would be more than happy to look at
your program; but I would hope you would look at the
President's program as well.
Mr. Bilirakis. The gentleman's time is expired.
Mr. Green to inquire.
Mr. Green. Mr. Chairman, I was under the impression that
Mr. Engel was in here first.
Mr. Bilirakis. We are in the second round now.
Mr. Green. Have you had your second round?
Mr. Bilirakis. If you are yielding to Mr. Engel, that is
fine.
Mr. Engel. I thank my colleague for yielding.
Mr. Secretary, I just want to reiterate some of the
comments made by my colleague, Mr. Ganske. When I go home to
New York, I hear my constituents talk about a prescription drug
benefit more than anything else.
Mr. Thompson. I am sure you do.
Mr. Engel. And I just, you know, want to--I know there are
many different ways of going about it, and I know that you said
that you want to do it as part of a reformation of the Medicare
program. But I just want to add my voice to those who are
saying that the $153 billion that the budget sets aside for
prescription drug program is woefully inadequate.
And I just hope that this thing is not relegated to a back
burner; that we really, really tackle it and tackle it soon.
There is a lot less talk about it, unfortunately, now than
there was last year; and I hope that does not mean that it is
being, you know, relegated to the back burner. The $153 billion
for prescription drug benefit was very disappointing to me when
I saw that in the President's budget, so I just want to
reiterate that.
Mr. Thompson. Congressman, I want to assure you that it is
not relegated. In fact, we are working very hard. But I want to
point out, as I did previously and before you were here,
Congressman, is that the President and my Department feel very
strongly that we just cannot do the prescription drug in
isolation.
We need to reform Medicare at the same time or else I do
not think we will ever have this great an opportunity again.
And if you just pass prescription drugs, I think maybe then the
$153 million will not suffice; but if we reform Medicare and
put some efficiencies in there, I think we can still get by. I
do not know if it is 153 million, the President says if it is
not. We will cost it out, and we will see what it is.
But right now, I just want to allay any fears you have that
we are not dedicated, because we really are. This is a cause
that this President wants to see solved.
Mr. Engel. I appreciate what you have said. I just get very
concerned that in some quarters the call for a reform of
Medicare because an excuse for an action on prescription drugs.
I know that is not your intent, and obviously you are going to
push ahead.
Mr. Thompson. That is not the President's intention.
Mr. Engel. I am happy to hear that, because that is a major
concern. I would like to mention something that is very
important to my State of New York. Last year, I worked with our
Governor, Governor Pataki, and the Clinton administration on a
compromise on the Medicaid upper-payment limit----
Mr. Thompson. Yes.
Mr. Engel. [continuing] to ensure that States like my
State, that are sending Federal Medicaid dollars on health care
programs for the poor, can continue to do so, while States not
using the funds for health care could not. The compromise
provided a phaseout so that these States would not see a
dramatic reduction in Medicaid payments that would severely
impact the ability to provide basic health care to the poor.
Now, the President's budget references changes to that
compromise, while at the same time, the House budget resolution
rejected this type of Medicaid cut.
I am obviously more comfortable with the House budget
resolution in this regard.
Mr. Thompson. I bet you are.
Mr. Engel. The projected savings in the budget from
altering the UPO rule is $606 million in fiscal year 2002 and
$17.4 billion over 10 years. Would the administration consider
the language in the House budget rule; and can you tell me if
not, where the President believes this savings would be
achieved, specifically, which States would lose their Medicaid
funding? It is really a matter of grave concern to us.
Mr. Thompson. I understand, because I worked on this
formerly as a Governor.
Mr. Engel. I know.
Mr. Thompson. But that was formerly. I am working on it now
as the Secretary, and I do not think you are going to see much
movement to the extend or expand the upper-payment limits from
this administration.
Mr. Engel. Well, I hope that we can try to make a case that
it is really important in these programs for the poor and it
is--the States that are really using the money for what it was
supposed to be utilized are not penalized as a result.
Mr. Thompson. I understand. As you know, there has been
some abuses.
Mr. Engel. And the abuses should be corrected.
Mr. Thompson. A lot of abuses. And even under the
compromise last year, some States are going to be phased out in
2 years; other States are going to be phased out over 8 years.
The President's or--our budget, the President, our budget
accelerates that to one.
Mr. Engel. I just want to ask you one other thing.
Mr. Bilirakis. Very, very quickly.
Mr. Engel. The Ryan White AIDS programs are frozen at $1.8
billion, you know, at a time when there are many different
therapies; and we found in New York City 3,000 people alone
increased in the enrollment in terms of those seeking
assistance from the AIDS drug assistance program.
It would seem to me that a freezing of the budget $1.8
billion is really unwarranted; and I am wondering if you could
look at that and, perhaps, consider increasing the assistance
for the Ryan White AIDS program.
Mr. Thompson. We have looked at it. And I want to tell you
that this is an issue that I am very interested in. Thirty-six
million people in this world have--are HIV infected or have
AIDS; 25.1 million are in Africa. Forty-three percent of the
new tuberculosis cases in the United States come as a result of
HIV infected people internationally, 43 percent in America.
This is a problem that is going to be coming to the United
States. We have a serious problem, not with the HIV but the
tuberculosis. We have a serious problem. This administration,
led by me in this regard, feels that the best hope is to come
up with a vaccine.
We are putting huge amounts of money into discovering a
vaccine to prevent the spread of HIV. And Ryan White, which is
a wonderful program, has had a 50--well, over 100 percent
increase in the last 5 years. We decided comparing to the
problem that is facing us internationally that we thought that
the money should be invested in finding the vaccine as soon as
possible and level-funding Ryan White.
That was a decision made by me and members of the
administration. We still think it is the right decision,
because there is a tremendous problem out there; and we are
going to try and solve it.
Mr. Bilirakis. The gentleman's time is long expired.
Mr. Pitts to inquire.
Mr. Pitts. Thank you, Mr. Chairman.
Mr. Secretary, the first question I have for you is one
that may take some time for you and your staff to research, so
I will just mention it now and ask you to get back to me later.
Is the Centers for Disease Control and Prevention currently
conducting or funding blind or unlinked HIV surveillance tests?
Many have argued that these tests are unethical because they do
not disclose positive test results to those who have been
diagnosed with HIV/AIDS, thereby denying live-saving treatment.
I would be interested to know your thoughts about these
studies and whether you would instruct the CDC to discontinue
further blind testing. You can respond later if you would like
to that.
But my second question, Mr. Secretary----
Mr. Thompson. Congressman----
Mr. Pitts. Go ahead.
Mr. Thompson. [continuing] I do not know anything about
that; that is the first time anybody has ever raised that. I
would like to----
Mr. Pitts. I will give you information.
Mr. Thompson. Give me information, and we will get an
answer back to you.
Mr. Pitts. Thank you, Mr. Secretary. My second question
relates to abstinence funding. In June 1999, then Governor
George W. Bush promised that if he became President he would
increase funding for abstinence-only education to equal the
Federal funding for safe sex programs.
The Bush Campaign conservatively estimated that to bring
abstinence funding to parity with safe sex programs, abstinence
would need to be funded at a minimum of $135 million from its
current funding of $80 million.
As you know, the final budget released last week does not
increase abstinence funding of this level of parity. In fact,
the official budget contains little or no increase in existing
law.
The question is do you intend to keep the President's
campaign promise to increase abstinence funding to the $135
million in fiscal year 2002?
Mr. Thompson. Congressman Pitts, absolutely the President
said that, and he stands behind it. We are going to fulfill it.
There has been a 10 percent increase in this budget going from
$82 million from $93 million in this budget for abstinence.
We know there is a disparity between abstinence and title
10; and we expect over the years, over the next 4 years, to
grow that to parity, not to take away one from the other, but
to grow so that they are both equal funding.
Mr. Pitts. Over a 4-year period, not in this budget?
Mr. Thompson. I do not think we can do it in this year's
budget.
Mr. Pitts. Okay. Mr. Secretary, do you have plans to make
sure----
Mr. Thompson. We went up 10 percent, I want to you know;
and I think that is a very sizable commitment by this
administration.
Mr. Pitts. All right. The next question is, do you have
plans to make sure that Federal funding is not going to
directly or indirectly fund abortion? And how do you plan to
increase oversight of programs like title 10 that have never
been studied for its effectiveness?
Mr. Thompson. Well, Congressman, we have rules in effect
and the law is very clear in this regard. The Henry Hyde
amendment is very forceful and straightforward, and we think we
are complying with it.
If you have--if you have instances where we are not, I
would appreciate hearing from you. We will then take a look at
it, but it is my understanding that we strictly enforced the
law. That is what people tell me.
Mr. Pitts. Okay. We will share information that we have for
you.
Mr. Thompson. Thank you.
Mr. Pitts. The last question, Mr. Secretary, is, as you are
aware, under the previous administration, the FDA approved the
abortion pill RU 486 and this drug protocol has been the
subject of significant controversy, since together they are
known to cause severe side effects, such as hemorrhaging for
women.
In fact, as reported in the L.A. Times, the second drug in
this two-drug protocol is manufactured in Chinese factories
that have been cited in the past for falsifying documents and
importing impure drugs into the United States. There are
actually 30 known cases of uterine rupture caused by RU 486.
Women in other countries where this drug is legal are
protected in significantly greater fashion than here in the
U.S., which should concern us. A recent survey of colleges and
universities determined that only one of over 30 schools
surveyed would offer this drug to their students since the
risks were too high for the schools. Many of them admitted that
they were unprepared to deal with the known side effects due to
the lack of necessary medical equipment at the campus health
facilities.
My question is, do you feel RU 486 requires any action at
this time by the FDA or HHS; and if so, has any money been
budgeted to review or study or monitor the severe side effects
caused by RU 486?
Mr. Thompson. There is no additional money budgeted for
review, other than to tell you that all drugs are reviewed for
safety. If there are questions of safety, we review them and
with all drugs approved by FDA, we will be monitoring RU 486
for safety and efficacy; and if there are problems that
develop, then a more intense review will take place.
But once a drug has been approved, the law does not provide
for the withdrawal of any drug, only based upon safety reasons.
And to this--to my knowledge, Congressman, there has not been
any empirical data submitted to show that there have been
safety violations of RU 486; but we will continue to monitor
that, as I am sure you want us to.
Mr. Pitts. Especially the imported drugs with the
documentation on impurities from China.
Mr. Bilirakis. The gentleman's time is expired.
Mr. Thompson. Thank you, Congressman. Thank you very much
for asking.
Mr. Bilirakis. Mr. Green to inquire.
Mr. Green. Thank you, Mr. Chairman. I will not talk all of
my time. Mr. Secretary, I appreciate your patience today; and
we do not always have a Secretary before us. In fact, serving
20 years in the legislature, I was trying to remember in Texas
if I ever had a Governor to question, so I appreciate your
patience today.
Mr. Thompson. So that is why you want to beat me up for so
bad?
Mr. Green. We are just inquiring; we are not beating
anybody up.
Mr. Thompson. You have been very good to me. I appreciate
it, thank you.
Mr. Green. I want to follow up from my other colleagues,
both Mr. Barrett and Mr. Brown, in the research and prevention
and that discussion. I understand the concern about putting the
dollars and the research; and if what we see happens with the
Senate, and the tax cut is scaled back, I would hope that you
would fight and advocate every way you could for whatever money
is available to be able to provide that funding for CDC and for
prevention.
I understand the limitations you had, but hopefully that if
there is some money there, you will be able to use it for that
prevention.
Mr. Thompson. Congressman Green, all I can tell you is if
you ask OMB, they said I have been very forceful.
Mr. Green. I understand. I will also follow up on my
colleague Mr. Engel and the concern about the prescription drug
benefit for our seniors. And if we continue to link it with the
need for Medicare overhaul--and I understand that the force is
for us to do--but everyday it seems like you could not hardly
leave the building in HHS without having a senior come up to
you and say we need it not only this year but we needed this
last year with the high cost of prescriptions for everyone, but
particularly for seniors who take more prescriptions than any
other age group and also have the least ability to work
overtime or something else to cover it.
So I would hope that the administration would reevaluate
saying maybe we need to do a prescription drug benefit without
necessarily having the Medicare overhaul. Because I would like
to look at both of them, too; but it just does not seem like
that is going to happen in Congress.
Mr. Thompson. Congressman Green, the President--that is why
the President submitted Helping Hand, because he did not know
if we were going to be able to get the reformation of Medicare
done with prescription drugs. So he put forth the Helping Hand
in case we cannot.
But I have to tell you, I do not see any move whatsoever in
this Congress. And I am not being political, I am not being
critical, I am just stating my assessment, that I do not see
any real effort to reform Medicare unless we do have
prescription drugs.
And I think we would be missing a golden opportunity about
reforming Medicare, because I think everybody recognizes that
Medicare needs some reform, and we can do that and have
prescription drugs. It is the catalyst to get the job done, and
that is why this administration feels so passionate about
having reformation at the same time with prescription drugs,
but also recognizing the need of seniors.
We have Helping Hand there in case we cannot get it done
immediately; we could pass Helping Hand and get some money to
the States so they can pass a prescription drug provision.
Mr. Green. And our committees have held hearings on Helping
Hand, and I have a very urban district and not a wealthy
population, and Helping Hand will not even provide the benefits
because, again, the State of Texas has no senior citizen
prescription drug program.
There is nothing even talked about in our legislature now,
so it would be years away before we get that. Our legislature
meets once every 2 years. And at the end of May, they are going
to be gone for 2 years. Our Governors also do not want to have
them in a special session.
Mr. Thompson. As a former Governor, I can understand that.
If I could have had the privilege of having my legislature come
over once a year, I would have felt very good about it.
Mr. Green. President Bush had them once every 2 years,
whether they needed them or not. Also I have a question I want
to submit to you concerning Medicaid regulations and
audiologists and the like.
Mr. Waxman asked if I would ask this question--or do you
want me to yield to you so you can do this--on lead poisoning.
I know that the advisory committee to end childhood lead
poisoning has for years asked that Medicaid be allowed to pay
for the lab tests on dust to find the lead poison in children's
homes.
We were told that you have the discretion to let Medicaid
do that, and will you look at that issue----
Mr. Thompson. I will.
Mr. Green. [continuing] on lead dust for children?
Mr. Thompson. I do not think Congressman Waxman was in here
when I said that I invested $150,000 a year to the Community
Health Program back in Wisconsin for 5 years, and we were able
to reduce the incidents of lead poisoning in that census track
by 60 percent, Congressman, by doing that.
It is a tremendous investment, and it is a great way to
hold down future medical costs of lead poisoning, especially
for minority children, which are usually the ones that get
affected.
Mr. Green. Thank you, Mr. Secretary. Thank you, Mr.
Chairman.
Mr. Bilirakis. I thank the gentleman. Mr. Greenwood to
inquire.
Mr. Greenwood. Thank you, Mr. Chairman. I have a question
for you, Mr. Secretary, about Medicare+Choice; but before I get
there, my colleague from Pennsylvania, Mr. Pitts, in his
questions to you was making a comparison between the funding in
your budget for abstinence-only education and the safe sex
campaign, and I quickly turned to the budget to see if I could
find the safe sex campaign and I am having trouble.
I found the family planning campaign, family planning
program which supports the network of 4,600 clinics nationwide
serving more than 4.5 million people. These clinics provide
access to such areas as reproductive health care, preventative
services counseling, routine gynecological care, hypertension
screening, screening and referrals for breast and cervical
cancer and substance abuse. Abstinence counseling and education
are an important part of the program. Service protocol for
adolescent clients, that is title 10.
You do not have a secret safe sex campaign funded in this
budget that I do not know about, do you, Mr. Secretary? You do
not have to answer that.
Mr. Thompson. I do not think so.
Mr. Greenwood. Medicare+Choice, Mr. Secretary, the crisis
with prescription drugs is real; and as everyone has said all
morning, we need to fix that. But there is an arguably equally
critical issue and that is the relative demise of
Medicare+Choice programs over the past several years. What used
to be a magnificent option for people to get their Medicare
through an HMO without having to pay the costs of MEDIGAP
insurance, getting a nice prescription drug benefit and other
goodies like glasses and hearing aids and so forth has been
underfunded. Part of that is the fault of the Congress, part of
that frankly was resistance from the previous administration
who hasn't been wild about Medicare+Choice.
The result of that is people who had prescription drug
benefits have lost them, people who have had access to managed
care have lost it, and people who had it at zero premium are
now paying a lot of money for it that they cannot afford. So we
really have to fix that.
In my area, it is compounded by the fact that the 1997
average area per capita costs of Medicare, the AACPCC, which
was designed to put more money where the costs are higher and
less money where the costs are lower, has really led to some
problems. One of them is that people from my district in Bucks
County go into Philadelphia for headaches; they go to
university hospitals and some of our other very fine teaching
institutions there.
And I am told by the insurance company that the cost of
their care gets attributed back in the 1997 calculation to
Philadelphia health care costs, not to the costs of--from the
assenting counties. So, therefore, the premiums HCFA was paying
to the insurance companies on behalf of my constituents is
considerably less than those in Philadelphia; and as a result
of that, my constituents are now paying about $60 a month more
for the same exact care that folks just across the border in
Philadelphia are paying.
We really need to fix that. I think it is a crisis that
needs to be fixed probably in the midst of, if not sooner than,
doing the whole Medicare reform and prescription drug issue.
Some of that is going to take--probably most of that is going
to take congressional action, but I would hope that as you
settle into this job you become very up to speed on the
existing crisis in Medicare+Choice and that we can work
together on that.
Mr. Thompson. It needs a lot of help and a lot of changes
and a lot of support. I think it has got a lot of good
possibilities and could have a bright future if we worked
together. And I cannot think of anything more I would rather do
than work on that subject. I got a couple others.
Mr. Greenwood. Something like 15 percent, I think it is, of
the Medicare recipients, including the disabled who have come
to rely on----
Mr. Thompson. You are right.
Mr. Greenwood. [continuing] managed care and come to rely
on the prescription drug benefit of managed care. I have
constituents who had a good--disabled constituents who had a
good prescription drug benefit up until January 1 of this year;
and when their prescription ran out, they lost any option they
had to get a prescription drug that they had been taking for
years.
I have one instance where a man who was 45 years old struck
by a car, a former computer programmer, is in such pain,
without his pain medication he becomes suicidal. That is, I
think, a poignant instance of the urgency of this issue.
Mr. Thompson. Thank you very much, Congressman. I want to
work with you on it. Please if you got ideas, send them to you.
As I once again reiterate to any members of the committee, if
you got ideas on how I can do my job better for you and how we
can improve the system, please let us know.
Mr. Bilirakis. The gentleman from Ohio, Mr. Strickland.
Mr. Strickland. Mr. Chairman, I do not want to give up my
opportunity to ask questions, but I would like to allow
Representative Waxman to go before me, if he may.
Mr. Bilirakis. I am amenable to it.
Mr. Waxman. I thank the chairman, and particularly Mr.
Strickland for letting me go ahead of him.
Mr. Secretary, I have to tell you, I think it is absurd
that we are going to freeze funding for the family planning
program which not only provides contraception, but reduces
infant mortality, maternal mortality, and low birth-weight
babies, in order to give more money for a chastity program on
abstinence, which I do not think anyone can argue is nearly as
important as the family planning program.
Second, I want to point out that to limit the amount of
money that goes into the Ryan White program, while you are
working on a vaccine, is to tell all of those people with HIV
infections that they may not be able to survive if we cannot
afford to buy the drugs for them.
We have not been able to limit the epidemic. I think the
problem we have is given the overall budget, you have indicated
you are going to increase the Community Health Centers, but you
are going to decrease the Community Access Program. We are
going to increase diabetes research, but then we are going to
take money away from the CDC.
We are going to give less for Ryan White and more for an
AIDS vaccine. So that seems to me moving the money around at a
time when the Congress and the President is saying let us give
billionaires more money by repealing the estate tax. And I just
point that out more rhetorically than anything else.
There are a couple of----
Mr. Thompson. May I respond, Congressman?
Mr. Waxman. Sure. But my problem is I only have 5 minutes.
Let me touch on a few other things, then you can respond to
everything.
Mr. Thompson. Okay. Thank you, Congressman.
Mr. Waxman. There are a couple of areas where I hope we can
be together. Congressman Diaz-Balart from Florida and I are the
lead sponsors of what is a bipartisan proposal to cover
immigrant children under Medicaid. It allows the States to
decide to cover those kids, rather than make them wait 5 years
and it eliminates other barriers that may even keep them
permanently from getting health care coverage.
The National Governors Association supports this change,
and I hope the administration will look at it favorably as
well.
The second area is this: there is a large bipartisan group
of members on this committee and the House and the Senate who
support the Family Opportunity Act to allow severely disabled
children to access Medicaid coverage. I hope you will look
favorably on that program, too.
And then I do want to comment on the fact that today it has
been very clear from your testimony that you are committed to
the promise of NIH research. In that regard, I want to note the
tremendous promise of stem cell research and hope that you will
keep that very much in mind as we look at that issue of
research.
And then my last comment is to just point out something
that Columnist Matt Miller recently wrote about when he talked
about coverage for all the people that are uninsured. There are
43 million uninsured in this country. There are 43 million
Americans today without health insurance, and President W. Bush
wants to help 6 million buy coverage.
But back in 1992, there were only 34 million uninsured, and
the first President Bush would have helped 30 million of them
get insurance. So what we have is President Bush, the son,
proposing to help so many fewer uninsured Americans than
President Bush, the father, did even though we are at a time
when there are more in need. I think that goes to the other
point that I was making.
We are spending the money, in effect, by giving tax breaks
to the people at the upper income; and those who have no health
insurance who have to rely on government assistance, programs
like the CHIP program or Medicaid, they cannot get that
coverage.
So with that, I just wanted to make those points to you;
and I hope we can work together on them, and certainly I want
to hear any response you have.
Mr. Thompson. Congressman, I want to work with you; I
really do. And there are philosophical differences. This
President, you know he won. He ran----
Mr. Waxman. And he got to be President. He did not win.
Mr. Thompson. He won. That is another philosophical
difference that you and I have. He won and he campaigned on a
tax cut. He campaigned on making equity between abstinence and
family planning. He campaigned----
Mr. Waxman. I did not hear that one, but all right.
Mr. Thompson. He campaigned on doubling the NIH budget.
This budget really is a reflection of what this President ran
on in the campaign. I have to give him a lot of credit for
carrying through on what he said he was going to do.
Now, our Department--and you are passionate, and I applaud
you for your positions on a lot of issues. You are passionate
about it; so am I. I am passionate in giving the best health
care for Americans from California through Wisconsin to Florida
and every State.
This budget has treated our Department very favorably. It
has gone up from $436 billion to $470 billion, an 8.3 percent
increase. That is a huge increase. Ryan White had an 81 percent
increase over 5 years, $811 million over Ryan White. It is a
good program.
I used it very effectively in Wisconsin, but we have an
international AIDS problem that needs attention. And in order
for us to do that, we thought, in order to really get some
direction, some way to really control HIV in the world and also
in America was to find the best way to come up with a cure or a
vaccine, not a cure, a vaccine, and I know you applaud that,
because you will be the first one there to help us support
that, but there are priorities.
And, you know, you do not like a tax cut. And as it is
obvious you do ot, I happen to think that we can have both. We
can do an excellent job of improving the health care and have a
tax cut that the President campaigned on. Besides that--forget
about the tax cut. In other areas, I want to work with you, I
want you to give me your best ideas, and I will come back with
our suggestions.
And if we can develop a bipartisan way to solve these
problems, I think not only will we be better off; but America
will be better off, and that is all I can offer you.
Mr. Waxman. Thank you for your answer.
Mr. Bilirakis. Mr. Strickland.
Mr. Strickland. Thank you. Mr. Secretary, I have sat here
and I watched you today and I thought of your experience not
being dissimilar to mine when I go to my district and I go to
the supermarket or I go somewhere shopping and people bring me
case work, and we have brought you a lot of casework today.
Mr. Thompson. You are right.
Mr. Strickland. You have spoken about being willing to
accept information about my constituents, and I have heard you
say to other members here you wanted to hear specifically about
their concerns.
Mr. Thompson. Yes.
Mr. Strickland. I appreciate that. As I said to you
earlier, I have been encouraged by what I have perceived to be
your attitude of genuine concern. I just wanted to say 2 or 3
things.
Many of us feel very strongly about research and
specifically about stem cell research and the great promise it
holds. I would just encourage to you do whatever you can within
the administration to make sure that legitimate scientific
life-affirming research is not interfered with because of
idealogical concerns.
Second, we have heard a lot of talk about the tax cut and
George W. Bush is our President, and we must embrace him as
such; but many of us also understand that over one half million
people voted for the other person in terms of a popular vote.
So we think that there is a necessity for us to compromise
on whatever agenda that is moved through this Congress, because
we do think that not every aspect that the President campaigned
on was, in fact, endorsed or embraced by the majority of the
American people.
I have just one final question--and you have been
incredibly patient, and I thank you for that--but in your
budget, you increase substance abuse treatment services funding
by $100 million, and I applaud you for that. However, your
budget decreases funding for mental health treatment services.
As you know, this program provides desperately needed
treatment services for mentally ill, around 13 percent of whom
are also substance abusers. Last year the Surgeon General's
report on mental health reported that less than \2/3\ of adults
with severe mental illness actually received treatment. Yet
this budget--the effect will be a decrease in monies received
by 33 of the States, including the State of Ohio.
Can you tell me if there are any circumstances under which
the administration would reconsider its proposal regarding
mental health treatment programs and, perhaps, support an
increase that would be at least commensurate with the increase
that you are making available for substance abuse treatment?
Mr. Thompson. First, let me thank you for your comments,
Congressman Strickland, and I do--you did offer me a lot of
cases, and I sort of thrive on that. I am a Governor. I like to
have problems; I like to solve them like you do.
Mr. Strickland. Can I say one word to you? I was
hypercritical of HCFA. I have been, people on this committee
know that, because I have been frustrated in the past that it
seemed impossible to get any action, and I wanted someone in a
position of authority to be able to make decisions. You appear
to be such a person, and that gives me some considerable hope.
Mr. Thompson. Thank you very much. I can do a much better
job if I can get some of my assistant Secretaries and Deputies
confirmed, and we are still running a Department with the few
young people I brought from Madison and Washington.
But be that as it may, mental health is a serious problem.
And I do not know where you are getting your figures, because
according to the figures I have here, we are going up by 100--
by $100 million and maybe there is some way that we can
reconfigure.
Mr. Strickland. A block grant program?
Mr. Thompson. I believe so. I believe we can reconfigure
the overall budget was $100 million, maybe we can reconfigure
some things to do things, because, you know, this is a budget
that I got--that was pretty much a budget put together before I
got there. And so I am willing to work with you on it. I do not
know the exact figure that you are looking at. I know your
staff is looking at it. I have to talk to my staffs.
Mr. Strickland. Yes. According to the information I have,
although there is a substance abuse increase, as I say, I
applaud you for, there is a significant decrease in the mental
health portion of that.
According to the allocation formula that I am familiar
with, some 33 States will actually receive a decrease in, and
Ohio will receive a significant decrease in, the funding for
that program.
Mr. Thompson. You are right with your figures. You are in
the mental health straight line, and we put $100 million in the
drugs for that. Maybe there is some way we can work together
during the budget negotiations to try and figure out how to do
it.
Mr. Strickland. If we could, here again I keep saying----
Mr. Thompson. I am not locked into these. If there is some
way that we can adjust the figures and make it more compatible
with what your constituents and what you want and what dictates
to with a bipartisan committee, I would be more than happy to.
Mr. Strickland. Thank you, Mr. Secretary, and thank you,
Mr. Chairman.
Mr. Bilirakis. I thank the gentleman.
Mr. Thompson. Nice meeting you.
Mr. Bilirakis. I had a request from Mr. Pallone to insert
these letters into the record, two letters to Mr. Thompson, one
dated April 6 of this year, and the other dated March 29 of
this year. And I ask unanimous consent they be made a part of
the record.
[The letters are retained in subcommittee files.]
This hearing is about to be adjourned. Mr. Secretary, there
always are questions that we submit to you, and I know that you
do not mind responding to those. I do not know how close we are
to reforming Medicare and our patients versus HCFA program; but
obviously, we want to work together; and I think that I can
speak for the entire committee how very impressed we are with
your concern, with your wanting to work with us; and we really
look forward to great things.
Is it true, you are camping at HCFA for a couple of weeks?
Mr. Thompson. One week.
Mr. Bilirakis. One week.
Mr. Thompson. I am going to set up Monday morning at HCFA
and run the----
Mr. Bilirakis. Good for you. That is just great. Well, that
being the case----
Mr. Thompson. Come and visit me, Congressman Strickland and
Congressman Bilirakis.
Mr. Bilirakis. There is so much of the cost-plus point that
you raised earlier regarding the contractors that we can help
you to do your job so much better. Please, do not hesitate to
submit to us or even wait until we request it, things that we
can do in order to help the Department function even more
efficiently. Thank you very much.
Mr. Thompson. Thank you. You are wonderful.
Mr. Bilirakis. Thank you, sir.
[Whereupon, at 1:20 p.m., the subcommittee was adjourned.]
[Additional material submitted for the record follows:]
Responses for the Record of Hon. Tommy G. Thompson, Secretary,
Department of Health and Human Services
Question 1. Your staff reported that the HCFA Program Management
request, $2.351 billion, is higher than any year requested by the
Clinton-Gore Administration. What do you intend to do with this extra
money? What is the state of the accounting and information systems at
HCFA?
Response: The request for the Centers for Medicare & Medicaid
Services (CMS's) Program Management funding, $2.35 billion represents a
4.9 percent increase over the FY 2001 appropriated level. This is
comparable to the President's Budget overall government-wide increase
of 4 percent.
Most of the proposed $109 million increase in CMS's Program
Management account is targeted for the Medicare contractors who process
almost 1 billion claims a year. Some of the increase will help CMS
improve its information technology infrastructure and some of it will
go to building a uniform accounting system at the Medicare contractors
and to replace the CMS administrative financial systems. The balance of
the budget increase is for implementing legislation and covering
payroll expenses.
Modernizing and stabilizing the Medicare claims processing systems
is one of our highest priorities for CMS. These systems are rooted in
the 1970's, when the claims being processed were a fraction of the
volume being processed today. They are based on outdated technology
that is expensive and difficult to maintain. Our ability to keep up
with the increasingly complex and rapid pace of change in our programs
depends on updating these payment systems and expanding their
capabilities.
Another priority is improving the financial management systems. CMS
spends hundreds of billions of dollars each year on Medicare benefits,
yet the Medicare contractors use ad hoc, piecemeal systems to account
for these funds. The General Accounting Office and the HHS Inspector
General have both expressed concerns about CMS's current financial
management system. It is simply inadequate for detecting and collecting
debt, for retaining a clean audit opinion, and for complying with
statutory requirements. For these reasons, the President's Budget
includes funding in FY 2002 to begin building a uniform accounting
system at the Medicare contractors and to replace CMS's administrative
financial systems. This is a multi-year commitment, but with billions
of trust fund dollars at stake, we believe it is worth the investment.
Question 2. On page 8 of your written testimony, you indicate that
you would like the Secretary of HHS (as opposed to the Part A provider)
to contract for and assign fiscal intermediaries to perform claim
processing. Do you anticipate that this will improve quality and lower
costs?
Response: Yes, I do believe it will improve quality and lower
costs. In order to manage an evolving Medicare operational and business
environment, and to bring more competition into its contracting fee-
for-service processes, I believe that CMS needs the authority to
contract for Medicare claims processing and payment functions through
full and open competition. Specifically, we need the ability to
contract with any entity qualified to perform specified Medicare claims
processing and payment functions. We submitted our legislative proposal
to reform the current contracting environment on June 28, 2001.
The major benefit of this proposal is that CMS would be able to
involve the broad expanse of capable business entities such as entities
with expertise in customer service, claims processing or education B in
meeting the needs of the evolving Medicare program, providers, and
beneficiaries.
In the new Medicare environment, there will need to be more
alignment between the marketplace, the government's requirements, and
available funding. CMS needs to increase its ability to leverage the
forces of competition and our proposal to move to performance-based
contracting should help ensure that contractors deliver effective
Medicare services on a best-value basis.
With regard to lowering costs, in the longer term, contracting
reform should save money. That is because the consolidation to fewer
contractors will reduce overhead and provide economies of scale. New
contracting methods will promote more efficient operations through
financial incentives for innovation and effectiveness.
CMS is engaged in a modeling effort to estimate cost and savings
over the first few years following contracting reform. We have
extensive experience with the cost of transitions; the more difficult
part of the equation is working with the factors and assumptions to
estimate the longer-term savings of consolidation and innovation. How
will you use the Government Performance and Results Act process to
generate information needed by your managers to reform and streamline
their programs? Will the need to accomplish higher goals with fewer
resources lead to more cooperation with private sector organizations?
In the short term, contracting reform may cause some increase in
the cost of program administration. As we transition from the current
environment to the post-contractor reform environment it will be
necessary to meet the costs of increased contractor transitions and
terminations. In addition, it may be necessary to provide incentives in
the first phases of the new environment that will not produce overall
administrative savings in the short term.
Question 3. How will you use the Government Performance and Results
Act (GPRA) process to generate information needed by your managers to
reform and streamline their programs? Will the need to accomplish
higher goals with fewer resources lead to more cooperation with private
sector organizations?
Response: CMS's performance goals represent its vast programs and
responsibilities. Performance planning under the Government Performance
and Results Act provides CMS the opportunity to learn from approaches
that work well and those that have been less successful as the Agency
strives for meaningful improvement.
Performance measurement results will provide a wealth of
information about the success of CMS's programs and activities to
inform all levels of management. It also will identify opportunities
for improvement and ways to better shape CMS's programs, policies, and
management choices for short and long-term goals. At CMS, Government
Performance and Results Act performance measures are included in annual
evaluations for SES-level managers, which underscores the importance of
performance measurement in CMS culture.
Our programs, as reflected in many of our Government Performance
and Results Act performance measures, entail partnerships with the
public and private sectors. Since many CMS responsibilities involve
external partnerships through the Medicare contractors, and many
States, etc., a major intended outcome of tracking performance is more
effective and efficient program management. We also know that working
in partnership leverages resources and increases coordination.
Question 4. At what time should Congress expect the nomination of
an FDA Commissioner?
Response: We are in the midst of the search and selection process.
We intend to make a selection as soon as possible.
Question 5. The President's budget calls for $40 million to be
spent on mandatory cost-of-living and pay-related increases for FDA
employees. Such pay increases were never proposed during the Clinton
Administration, so they were paid for by decreased funding elsewhere
within FDA. Why did the President feel it was important to include FDA
pay-related increases in his budget?
Response: You are correct that in some recent years, FDA has
reduced the amount of work it accomplished in some areas to fund pay
raises and other inflationary costs. The President's budget reflects
the importance of increasing, not decreasing, the front-line FDA staff
who work to ensure the safety of our foods and medical products. For
example, last year, FDA was able to meet only about half the statutory
requirements for inspecting drug and device facilities. The request for
$40 million for pay raises ensures that FDA can maintain inspection
rates and product approval time frames at the same time it expands
efforts in specific areas, such as mad cow disease, oversight of
imports, food safety, patient safety, and research subject protection.
Question 6. As Secretary of HHS. You are required to rule on the
safety and cost savings of reimporting prescription drugs. What are
your initial thoughts on that issue and when should Congress expect a
final decision?
Response: My decision on this matter was announced in a letter to
Senator Jeffords on July 9, 2001. After a careful review of the factors
that affect the safety of imported drugs and the expected savings, I
concluded that the determinations required under the law could not be
made and that I therefore could not implement the program. I do not
believe that we should sacrifice public safety for uncertain and
speculative cost savings.
Question 7. How will the $15 million funding increase for Mad Cow
Disease prevention proposed in the budget better enable FDA to ensure
the disease never makes its way into America?
Response: Bovine Spongiform Encephalopathy (BSE) belongs to a group
of progressive degenerative neurological diseases known as
Transmissible Spongiform Encephalopathies (TSE), which are always
fatal. To prevent the spread of BSE through certain animal feed
products, in August 1997, FDA published a regulation that prohibits the
use of most mammalian protein in the manufacture of animal feeds for
ruminants (Title 21, Code of Federal Regulations (CFR) Part 589). With
the strong support of renders, cattle owners feed manufacturers, and
feed lot owners, FDA launched a compliance and education program,
including a rigorous inspection program to implement the regulation.
In addition, in April 2001, FDA implemented its TSE Action Plan, a
comprehensive approach to addressing FDA's responsibility in this
important public health issue. This plan will protect the public health
by:
--strengthening our efforts to keep BSE out of the American cattle herd
and to keep it from amplifying in the herd were it ever to be
found in American cattle;
--strengthening our vigilance to keep potentially TSE-infected foods
and other FDA-regulated products from Americans; and
--enhancing the research needed to better understand TSEs and to
develop needed diagnostic tools, therapies, and preventive
measures for humans and animals.
The proposed FY 2002 budget, which includes an increase of $15.0
million for BSE activities, is a down payment on better enabling FDA to
help industry achieve compliance with the 1997 feed rule and will
assist in the implementation of the FDA TSE Action Plan.
The specific activities proposed for FY 2002 that would be
partially funded by this $15.0 million that implement the 1997 feed
rule and the TSE Action Plan are as follows:
Foods Program, $1.1 million:
1. expand work efforts to identify food and cosmetic products
containing brain, spinal cord, and other specific risk
materials (SRMs); the origin of the animal; and country of
origin;
2. research the risk factors and mechanism for chronic wasting disease
(CWD), a TSE that affects elk and deer in several western US
states; and
3. participate in international BSE meetings to help ensure safety of
the U.S. food supply by providing up-to-date information on
this emerging public health issue.
Biologics, $0.5 million:
4. help address the potential BSE threat to the safety of biological
products. Two biological product areas affected include the
safety of the blood supply and the safety of vaccines derived
from bovine-source material.
Animal Drugs and Feeds $13.1 million ($2.2 million Center, $10.9
million Field):
5. conduct targeted BSE inspections of all known renderers and licensed
and non-FDA licensed feed mills handling prohibited material,
such as meat and bone meal, on a yearly basis, and conduct
reinspections of those with compliance deficiencies, taking
appropriate enforcement actions for repeated or egregious
violations;
6. leverage with State agencies by funding approximately 4,000 contract
inspections of feed mills and renderers, and conduct
compliance, follow-up, and audit inspections to state contracts
7. review and evaluate field inspection data and take enforcement
action when necessary;
8. develop a domestic sampling plan, collecting and analyzing 600
domestic feed, and feed component samples for BSE related
contaminants. In addition, the Animal Drugs and Feeds Program
will increase the number of import samples by 600. This
sampling will help ensure that imported products are properly
declared on their import manifests;
9. provide intensive line entry and label review, when appropriate, of
an anticipated 175,000 import line entries for use in domestic
commerce for the Animal Drugs and Feeds Program by expanding
import staff by 17 FTE;
10. conduct additional training for Federal and State inspectors on the
BSE feed regulation, update them on the current European Union
situation, Animal and Plant Health Inspection Service (APHIS)
authority and approach, and what to look for and how and when
to sample;
11. modernize the existing information technology infrastructure to
facilitate electronic inspection reporting and information
collection and distribution; and
12. educate industry and the general public on BSE through public
meetings, publications, and FDA's website.
Other Activities, $0.3 million:
13. provide advice and counsel on legal matters, render opinions, and
support rulemaking proceedings, legislative matters, policy
deliberations, and domestic and international negotiations; and
14. provide litigation support for enforcement, defensive and third-
party matters.
Question 8. The President proposes to increase the FDA's budget by
nearly 10%, which is more than nearly every budget proposed by
President Clinton. Also, the 10% increase represents the second highest
discretionary increase within HHS, Why did you ensure that the FDA
would receive this amount of funding?
Response: The relative size of these increases reflects the
importance of a strong FDA. There are many public and statutory
expectations that FDA cannot meet now. FDA's responsibilities are
broad, and the FY 2002 Budget proposes resources to match. We need to
improve oversight over all imports; improve the use of medical products
to reduce adverse events; make sure food is safe and protect against
mad cow disease; and make sure human research subjects are not
endangered.
Question 9. The budget allocates $10 million to protect human
subjects in clinical trials. How will this impact the number of
clinical trial-associated inspections?
Response: FDA, whose product reviews depend on the validity of
clinical trial data, monitors the entire system of safeguards for all
clinical trial participants. Currently, the Agency conducts about 1,200
trial-associated inspections per year, with approximately 1,100
domestic and foreign. These inspections may involve extensive
interviews with sponsors, monitors, investigators, site staff, and IRB
administrators, and examination of their records, procedures, and
responsiveness to participants' concerns.
With the requested FY 2002 $10 million increase, the number of
annual inspections will increase by more than 20 percent with an
emphasis on high-risk trials, such as those enrolling vulnerable
populations such as the mentally impaired and children. The increase
will also enable FDA to review and provide an initial follow-up on
virtually all complaints concerning clinical trials within 30 days of
receipt.
FDA views the protection of human subjects in product studies as
highly important for both the health and safety of the study
participants and for the integrity of the drug development process.
Question 10. As you are aware, under the previous Administration
the FDA approved the abortion pill regimen, RU 486. Has there been any
decision to examine the FDA's approval process, and does the
Department's budget reflect this? Do you feel any money needs to be
used to explore the FDA's drug approval process?
Response: While RU 486 is a unique and controversial drug, there is
no evidence that the drug approval process was compromised in any way.
The same high standards of safety and efficacy were applied to RU 486
as with any other drug product. We see no evidence of problems with
FDA's drug approval process that merit investigation.
Question 11. Has any money been budgeted to educate ob/gyns and
other medical and health care professionals on the potential dangers
and risks of RU-486? Do you think the Department should spend time and
resources to educate doctors and clinics and abortion providers about
the very real dangers involved with RU 486?
Response: Although there is no specific money budgeted, in
approving mifepristone (RU-486), FDA did put in place a detailed risk
management plan to be carried out by the drug manufacturer to help
ensure that the drug would be used only by qualified physicians and
that there would be widely disseminated information explaining the
risks and benefits of the drug. An important component of this program
is the education of both physicians and patients about the safe and
effective use of this product. FDA determined that a Medication Guide,
written information for patients explaining important safety
information and instructions for use, was necessary for women to be
able to effectively and safely use mifepristone. The Medication Guide
is important for women to be fully informed about how mifepristone
works and about its risks, as well as the need for follow-up visits
with their health care provider. In addition, patients are asked to
sign an agreement that explains what mifepristone is used for and how
it is administered to patients. Also, the company agreed to provide
mifepristone only to physicians with particular qualifications who
signed agreements that they understood certain information about the
drug and that they would provide the Medication Guide to each patient.
The current patient and physician information is approved by FDA. These
materials, combined with the other components of the risk management
program, provide the appropriate information about the potential risks
and benefits of mifepristone. FDA currently maintains a web page on its
website that contains all of the mifepristone information. The address
is www.fda.gov/cder/drug/infopage/mifepristone.
Under the terms of the FDA approval, mifepristone is distributed as
follows:
MifeprexJ must be provided by or under the supervision of a
physician who meets the following qualifications:
--Ability to assess the duration of pregnancy accurately.
--Ability to diagnose ectopic pregnancies.
--Ability to provide surgical intervention in cases of incomplete
abortion or severe bleeding, or have made plans to provide such
care through other qualified physicians, and are able to assure
patient access to medical facilities equipped to provide blood
transfusions and resuscitation, if necessary.
--Has read and understood the prescribing information of MifeprexJ.
--Must provide each patient with a Medication Guide and must fully
explain the procedure to each patient, provide her with a copy
of the Medication Guide and Patient Agreement, give her an
opportunity to read and discuss both the Medication Guide and
the Patient Agreement, obtain her signature on the Patient
Agreement and must sign it as well.
--Must notify the sponsor or its designate in writing as discussed in
the Package Insert under the heading DOSAGE AND ADMINISTRATION
in the event of an ongoing pregnancy, which is not terminated
subsequent to the conclusion of the treatment procedure.
--Must report any hospitalization, transfusion or other serious events
to the sponsor or its designate.
--Must record the MifeprexJ package serial number in each patient's
record.
Question 12. Part of the problem of getting adequate health care in
undeserved areas is the lack of health care providers. Do you agree
that we should make sure that there are no barriers to faith-based
charities serving as Community Health Centers?
Response: We agree that faith-based charities should be considered
for funding as community health centers along with other public and
private nonprofit entities that meet the statutory requirements of
section 330 related to the provision of services, governance,
management and finance.
Question 13. How will the proposed $3 million HHS Center for Faith-
Based Community Initiatives work with the Community Health Center
program?
Response: The HHS Center for Faith-Based and Community Initiatives
will support the ongoing work of the Community Health Centers (CHC)
Program. The CHC Program is an example of how HHS already works with
faith-based organizations to improve access to quality care. The two
programs will work together to ensure that faith-based charities are
considered for funding as community health centers along with other
public and private nonprofit entities that meet the statutory
requirements of section 330 related to the provision of services,
governance, management and finance. Several faith-based organizations
currently receive CHC funding.
Question 14. This year one of the most critical public health
reauthorization before our Committee is the Community Health Centers
program. While there are some changes needed to strengthen the program,
we are interested in your views concerning desirable changes. Are there
other issues concerning the reauthorization of the health centers
program that you would like to share with the Committee?
Response: Reauthorization and expansion of the Community Health
Centers programs is a priority for the Administration. The President's
fiscal year 2002 budget requests an increase in funding of $124 million
for the health centers program. Our goal is support 1200 new or
expanded sites over five years and provide quality health care services
to an additional one million individuals in fiscal year 2002. The long-
term goal is the double of the number of people served by community
health centers. With these goals in mind, the Department will carefully
review any proposed changes to the program
Question 15. Last year, one of the top priorities of this Committee
in the Beneficiary Improvement and Protection Act was the establishment
of a new Medicaid prospective payment system for health centers. The
Committee established the PPS to stabilize the health center safety net
by making sure that state Medicaid programs pay their fair share for
the care of health center Medicaid patients. In doing so, the Committee
is ensuring that the Public Health Service grants we authorize for care
of the uninsured are utilized fully for that purpose and are not used
to subsidize Medicaid underpayments. Full implementation of the PPS is
critically important to this Committee. Can you please tell us what the
Department and HCFA are doing to implement the PPS and how states are
responding to the new system?
Response: To date, all fifty States and the District of Columbia
have submitted the required State Plan Amendments to implement the
changes in their payment rules for federally qualified health centers.
CMS has approved most of these State Plan Amendments and have been
working closely with the States whose amendments were not approvable,
as submitted, to get the amendments into approvable form.
This, however, is just the first step to full implementation.
States are reconciling cost reports and gathering other pertinent
payment data for fiscal years 1999 and 2000 in order to accurately the
calculate the baseline payment rate for the PPS system. While that
process is taking place, States are reimbursing centers/clinics based
on the payment methodology in place on December 31, 2000. Once the
baseline rate for the PPS system has been determined States will make
clinics whole for any shortfall between the interim payment rate and
the new PPS rate back to January 1, 2001.
Question 16. Another important public health program is the
National Health Service Corps. This program places health professionals
in undeserved locations across the country by offering to pay for a
portion of their medical education. The program works very closely with
the health centers program and others to provide care to the most
vulnerable in our country. The authorization for the NHSC expired last
year. In his budget submission, the President has stated that he thinks
the NHSC should be reformed to better target needy communities. What
specific ways do you think the NHSC should be reformed?
Response: We are examining the ratio of scholarships to loan
repayments awarded as well as other set asides to ensure maximum
flexibility to better meet community requests for NHSC providers. To
more accurately define shortage areas and target placements, the
Administration will seek to amend the shortage area definition to
reflect other non-physician providers practicing in communities. We are
also planning to enhance coordination with immigration programs such as
the J-1 visa program.
Question 17. In his budget, President Bush proposes to create a
$400 million ``Healthy Communities Innovation Fund'' will work? How
will it fit with other programs this Committee oversees?
Response: The President's fiscal year 2002 budget proposes $400
million annually for The Healthy Communities Innovation Fund for local
demonstration and pilot programs aimed at addressing local health
problems. Activities will target health risks, increasing access and
improving health care quality. The Healthy Communities Innovation Fund
will improve coordination and increase innovation among certain
activities of the Centers for Disease Control and Prevention (CDC), the
Health Resources and Services Administration (HRSA) and the Centers for
Medicare and Medicaid Services (CMS, formerly the Health Care Financing
Administration).
HRSA programs included in the Fund ($221 million in FY 2002) are:
Healthy Start, Maternal and Child Health National and Regional Special
Projects, Community Integrated Service Systems, and Community/Migrant
Health Centers-Integrated Service Delivery. CDC programs included in
the Fund ($183 million in FY 2002) are: Cardiovascular Disease
Prevention, Diabetes Prevention and Control, Comprehensive Cancer
Prevention and Control, Tobacco Use-Reduction State, Local and
Community Awards, and Racial and Ethnic Approaches to Community Health
(REACH). The CMS included is the Fund ($10 million in FY 2002) is the
Community Innovation Fund.
Question 18. Your written testimony on page 3 indicates that the
budget keeps the President's commitment to double NIH's FY 1998 funding
level by FY 2003, with a request of $2.75 billion, which will be the
largest dollar increase ever for NIH. How will NIH set priorities for
its research? Why are thee such a large research-dollar-per-mortality
disparity among diseases? Should we expect those ratios to be more
comparable with one another in the future?
Response: How will NIH set priorities for its research? NIH will
set the priorities for the budget increase according to long
established policies and practices used each year to allocate the
agencies budget. The allocation of NIH funds during a given year is the
culmination of a lengthy, comprehensive, and ongoing process. Many
factors are considered in the allocation of funds from the NIH budget
public health needs, a commitment to support work of the highest
scientific caliber, a responsibility to seize the scientific
opportunities that offer the best prospects for new knowledge and
better health, a need to maintain a diverse portfolio that supports
work in many scientific disciplines and on a wide range of diseases,
and an obligation to insure a strong scientific infrastructure, with a
high quality workforce and excellent research facilities. The
allocation of the NIH budget reflects the use of the best available
information and judgments regarding balancing the criteria for budget
decisions.
To evaluate these many criteria for making decisions, the NIH seeks
information and advice from many individuals and groups, including the
extramural scientific community, patient advocacy groups, Congress, and
the Administration. For example, each Institute and Center (IC)
convenes meetings of national advisory councils or boards, with members
from the public, medical, and scientific communities, to review a broad
range of IC policies, and many conferences and workshops are organized
each year to gather opinions on specific scientific, health, and
management issues. The IC's efforts to seek public input are augmented
by those carried out by the Director, NIH. The views of the scientific
community and the public are gathered through meetings of the Advisory
Committee to the Director (ACD), NIH, the NIH Council of Public
Representatives (COPR), and other meetings and workshops. In addition,
the NIH holds an annual Budget Retreat to help develop its priorities
for the President's budget. The meeting involved the NIH leadership
along with external advisors, from the ACD and from the COPR. Efforts
to encourage and coordinate public participation in NIH programs have
been undertaken through the public liaison offices that have been
established in the Office of the Director and in each IC.
To help in explaining the NIH process for setting priorities, NIH
prepared a brochure entitled, ``A Setting Research Priorities at the
National Institutes of Health.'' In addition, the FY 1998 DHHS
Appropriations Act required the Secretary to contract with the
Institute of Medicine (IOM) to conduct a comprehensive study of the
policies and processes used by the NIH to determine funding allocations
for biomedical research http://www.nih.gov/news/ResPriority/
priority.htm. The IOM Committee released its report, Scientific
Opportunities and Public Needs: Improving Priority Setting at the
National Institutes of Health on July 8, 1998. http://www.nap.edu/
books/030906130X/html/index.html The IOM report made several
recommendations to enhance the NIH priority setting process and it
endorsed the criteria used by the NIH to set priorities.
Why is there such a large research-dollar-per-mortality disparity
among diseases? First, I want to assure you that information on burden
of illness (BOI) is widely and routinely used to inform the NIH
priority setting process. I would like to make three points in response
to the implicit suggestion that funds should be allocated in proportion
to the number of persons who die from the disease. First, the number of
people who die from a disease is an incomplete and imperfect indicator
of public health need or burden associated with a specific disease or
condition. Second, coding or classifying research expenditures to a
particular disease or condition is an inexact art, which can only be
done approximately, at best. Third, the allocation of research
resources is influenced by scientific opportunities as well as public
health need.
It is arbitrary and misleading to select one measure, whether
deaths, the number of cases, or dollars spent on treatment, to rank
diseases in terms of burden. For example, funding according to the
number of individuals affected by each disease would emphasize common
diseases, but might have a limited effect on overall health and
survival. By that criteria, much research would be done on the common
cold and allergies, but little would be allocated to childhood cancers.
More inclusively, the burden of illness includes the degree to which a
disease cuts short a normal, productive, comfortable lifetime the years
lost to premature death; the pain, suffering, and reduced functioning
associated with a disease; and the number of people who have a
particular disease. The economic and social costs associated with a
disease are an important additional consideration, but only partially
reflect the personal costs of mortality and morbidity. The extent to
which the threat of a disease is expected to increase or spread over
time must also be included as an element of burden (e.g., increasing
threats may result from a recently detected infectious disease, a
manifestation of an environmental hazard, aging of the population,
e.g., Alzheimer's disease).
Unfortunately, there is no simple formula or index that summarizes
all the dimensions of burden into a single number. The simple counting
of deaths is clearly an incomplete proxy for burden. Without
consideration of age at death it fails to capture the potential life
years lost. It does not capture the economic and social costs
associated with morbidity and if fails to reflect trends in the
relative threat of disease over time.
Allocating burden to a specific disease is also difficult. Many
people suffer from more than one condition, which may or may not be
inter-related. One disease or condition such as diabetes or HIV may
lead to a complication or vulnerability to another condition. For
example, a person with diabetes who dies secondary to diabetic kidney
failure may appear as a death due to kidney failure without mention of
diabetes. Available statistics on disease-specific burden are based on
somewhat arbitrary decision rules and do not always recognize the
contribution to burden of comorbidities and underlying causes. The
allocation of burden may be further biased when certain conditions are
systematically misdiagnosed or are under reported because of social
stigma.
Similarly, assignment of research funding to a particular disease
category may be somewhat arbitrary. It is extremely difficult to assign
the large investments in basic research, research instruments and
equipment, and training investigators to any one disease. Also, from
long experience we know that research aimed at one target often hits
others as well. For example, cancer research, i.e., research on
retroviruses, laid an important foundation for relatively quick
progress in the development of drugs for the treatment of HIV/AIDS.
Finally, even if consistent and comprehensive estimates of the
relative burdens of specific diseases were available, decisions
regarding research priorities would also have to include the importance
of scientific opportunities. A recent research advance often creates
greater scientific opportunities for research and development in one
disease area than in others. Conversely, a lack of knowledge regarding
underlying pathophysiological processes can inhibit the development and
evaluation of diagnostic and therapeutic technologies for other
conditions, regardless of their social burden. Increased spending on a
disease is wasteful when there are neither promising pathways to follow
nor an adequate number of qualified investigators to fund.
Should we expect those ratios to be more comparable in the future?
Because trends in disease-specific burden and the distribution of
scientific opportunities do not change rapidly, it is not necessary or
desirable to radically readjust the allocation of program funding from
year to year. An across the board increase in funding for each program
is a reasonable starting point for allocating increases in annual
appropriations. The program funding increases are modified up or down
to adjust for any perceived changes in disease-specific burden or to
capitalize on newly generated scientific opportunities. But those year
to year changes will generally be slight.
It is important to recognize that much of the planning of NIH-
sponsored research is centered on broad scientific themes (such as
genome projects, development of instrumentation, training in clinical
research, or developments in basic science), without reference to the
many specific diseases that might be addressed through these efforts.
The success of individual applicants for NIH grants, the nature of
their interest, and the specific knowledge generated by the non-
disease-related projects, will gradually uncover new opportunities and
will influence subsequent disease-oriented planning and disease-
specific spending patterns.
The substantial base of research funds already committed to grant
recipients and the need to provide stable support for scientific work
restrict the degree to which funds can be directed. Scientific work is
not simply a commodity that can be purchased; the effective shifting of
priorities requires new ideas and new personnel as well as budgetary
realignments. To augment research on specific topics in a more
responsible fashion, it is necessary to show that under-explored
opportunities exist and that they can attract investigators either
newly trained scientists or scientists from other fields who will then
propose meritorious projects.
In conclusion, the number of deaths associated with a disease is an
imperfect guide to research resource allocation. It is not an adequate
standard by which to evaluate the allocation of NIH funding. The NIH is
responsible for conducting research on the broad array of health
problems affecting people in this country, but it cannot simply
allocate funds to research on one disease or another according to a set
formula.
Question 19. Many members of this Committee support an increase in
funding to NIH for cures to devastating diseases. However, the
Committee wants to ensure that these large increases will be
accompanied with appropriate oversight. What kind of oversight will HHS
put in place to monitor the NIH increases?
Response: The recent increases in the NIH budget have enabled us to
better capture scientific opportunities, translate research from bench
to bedside, complete the Human Genome Project in less time than
anticipated, and engender excitement about research among the young
investigators. NIH recognizes that in this optimal budget climate, it
is important to maintain the highest quality of science by upholding
the rigor of peer review. We continue to seek advice and input from the
Institutes and Centers (IC's) advisory councils on funding decisions,
priority setting and other portfolio management issues. We are keenly
aware that the increased budgets must be accompanied by enhanced
oversight to ensure proper stewardship of public funds. For example, in
the area of clinical trials, the NIH supports more than five thousand
clinical trials involving several million-research participants. With
the recent increases in the NIH budget, these numbers have gone up.
However, even with the increased number of clinical trials, we must
ensure that the overall system for protection of research subjects is
intact. Moreover, the NIH has recently taken steps to strengthen the
oversight of clinical trials. Since 1979, NIH has had a long-standing
policy of requiring data and safety monitoring for clinical trials.
Monitoring is commensurate with the level of risk, the size and
complexity of the trial. For most phase III trials, a data and safety
monitoring board is required.
New steps taken include:
--Beginning with the October 1, 2000 receipt date, applicants must
submit a monitoring plan for phase I or II trials. The plan is
subject to the review and approval of the funding Institute and
Center, and awards are contingent on their approval.
--Principal investigators must report certain types of FDA
communication to the NIH. These include warning notices and
letters, consent agreement and clinical hold letters.
Investigators must report to funding IC within 72 hours of
receipt. Failure to comply may result in corrective and/or
enforcement action.
--Required education on the protection of human subjects--Beginning Oct
1, 2000, the NIH requires investigators, i.e., key personnel,
who are responsible for the design or conduct of research
involving human subjects to be educated on the protection of
human subjects. To facilitate implementation, the NIH made
available a number of ready-to-use curricula, including two
online modules developed by the NIH. Investigators have some
flexibility to determine what is an appropriate level of
education. Documentation of education is required before funds
are awarded.
Question 20. The NIH is in the process of organizing the new
National Institute of Biomedical Imaging and Bioengineering (NIBIB).
The NIH reported in a 1998 letter to Chairman Bilirakis and in
testimony before this Subcommittee just last September, that it
invested $217 million in basic bioimaging research in FY 1997 and
indicated that spending in this field had increased since then. Earlier
this year, the NIH leadership directed each individual Institute to
identify existing grants in its portfolio that are primarily
fundamental imaging research for transfer to NIBIB. Despite the
previous NIH claims about the magnitude of its investment in basic
imaging, it looks like the amount of grants to be transferred will fall
short of the amount reported earlier.
Mr. Secretary, either the NIH exaggerated its investment in imaging
then or the NIH is now attempting to thwart the will of Congress in
creating the new Institute. In either case, it appears that NIBIB will
be severely underfunded. It also appears that the NIH is delaying
release of the amount to be transferred to NIBIB to ensure that the
Appropriations Committees will not have complete and accurate
information to consider in setting a funding level for NIBIB.
Mr. Secretary, can you look into this matter and report back to
this Subcommittee on the relationship between the previous NIH
testimony and the current process of identifying grants for transfer to
NIBIB?
Response: We are excited about the new opportunities that the new
National Institute of Biomedical Imaging and Bioengineering (NIBIB)
will create for support of fundamental research that applies principles
of engineering, mathematics, computer science and the physical sciences
to biological processes, disorders and diseases.
The President's budget request for NIBIB for Fiscal Year 2002 is
$40 million. These funds will be supplemented through a transfer of
appropriate grants to NIBIB from other NIH Institutes and Centers
(ICs). The transfer of grants to NIBIB is intended to strengthen and
complement, not subtract from or substitute for, research programs in
the other NIH ICs. NIBIB will support undifferentiated research not
related on a one-to-one basis to the mission of another IC and act as a
unique focal point for multidisciplinary research planning and
strategic development. The other NIH ICs will continue those studies
that are a natural fit within their current organizations--those
focused on specific diseases or conditions. The ICs and key
constituencies in the imaging and engineering communities have endorsed
this strategy for building the new Institute and continuing to support
these studies across NIH.
The process for identifying the appropriate grants for transfer is
underway. After we review the entire slate of grant transfer
candidates, NIH will submit the transfer information to the House and
Senate Appropriations Committees for final approval and incorporation
into the FY 2002 budget for NIBIB.
Question 21. Can we have your assurance that NIBIB will have the
resources necessary to fulfill its extremely broad and important
mission? This institute has the potential to produce dramatic
breakthroughs in the detection, diagnosis, and treatment of a wide
range of diseases, but that potential will not be realized if NIBIB is
starved.
Response: We believe that the Fiscal Year 2002 budget request of
$40 million, plus the appropriate grants transferred from the other
ICs, will establish an adequate base upon which to build future year
funding requests for the NIBIB and will permit careful stewardship and
oversight of research programs in the first year of this newest of the
NIH ICs. As rich opportunities emerge, we will adjust our future budget
requests accordingly
Question 22. In light of recent studies proclaiming the Connecticut
Baby AIDS law a success and the remarkable data from the New York Baby
AIDS law, will you direct the CDC to re-evaluate the agency's
opposition to routine diagnosis of women and newborns of HIV?
Response: CDC does not oppose the routine diagnosis of women and
newborns for HIV. Focusing testing on newborns, however, offers much
less chance of successful interventions to prevent perinatal HIV
transmission than do efforts to encourage pregnant women to seek
testing and providers to increase prenatal voluntary counseling and
testing and antiretroviral interventions during pregnancy. CDC
recommends that voluntary HIV testing should be a routine part of
prenatal care. Based on data from all States, including New York and
Connecticut, the U.S. Public Health Service Recommendations for HIV
Counseling and Voluntary Testing for Pregnant Women are being revised.
The revised guidelines should be published in late summer and will
strengthen the recommendations that all pregnant women be tested for
HIV, emphasize HIV testing as a routine part of prenatal care,
recommend that providers explore and address reasons for refusal of
testing, and place more emphasis on HIV testing and treatment at the
time of delivery for women who have not received prenatal testing and
chemoprophylaxis. The New York law's major effect appears to be
associated with increased efforts by providers to offer prenatal
voluntary counseling and testing. Increased prenatal voluntary
counseling and testing offers the best chance of maximally reducing the
risk of perinatal transmission because it increases the opportunity to
lower maternal viral load to nondetectable levels near delivery and
provide chemoprophylactic therapy to the baby during labor, delivery,
and afterwards. States other than New York have excellent prenatal
voluntary counseling and testing rates in the absence of mandatory HIV
testing in newborns. For example, data on HIV testing in 1998 indicated
that in Arkansas 85 percent of pregnant women were tested during
pregnancy or at delivery. In Colorado and Florida, these numbers were
79 percent and 84 percent, respectively.
Question 23. The Bush Administration and John Walters, the Director
of the White House Office of National Drug Control Policy, have set as
a priority stigmatizing drug abuse. Yet the CDC is claiming that the
stigma associated with drug abuse and other high-risk behaviors is, in
large part, responsible for HIV infection. Recently, the CDC held a
national teleconference to address how to remove such stigma. The CDC
admits no studies have been conducted to substantiate claims about a
link between HIV infection and stigma. What are your views on this
issue and do you think it is appropriate for the CDC to invest limited
resources in a campaign to remove the stigma associated with drug abuse
and other risk behaviors?
Response: Between 800,000 and 900,000 persons in the United States
are estimated to be living with HIV or AIDS. Many of these people face
stigma and active discrimination because of their health status or
related reasons. Stigma finds its roots in fear and misunderstanding
about how HIV is transmitted and in underlying attitudes about the
populations most heavily affected by this epidemic.
CDC and other organizations have found that HIV prevention efforts
are significantly hindered by biases and stereotypesBin fact, some
communities are reluctant to even discuss risk behavior and
transmission, resulting in community members not being able to receive
appropriate information and prevention services to prevent HIV
infection and transmission.
Focus on this area also was recommended by the Institute of
Medicine (IOM) in its September 2000 report No Time to Lose: Getting
More from HIV Prevention. In this document the IOM Committee described
stigmatization of persons with HIV as a pernicious barrier to
preventing new infections, and specifically said that it believes that
the protection of human rights, privacy, and equity continues to be a
significant concern, and that concurrent efforts at the federal, state,
and local level to remove or at least lessen the impact of stigma and
discrimination are necessary.
CDC's interest in this important prevention issue is not to support
illegal drug injection or specific sexual behaviors, but rather to
eliminate stigma and discrimination as a barrier to reducing new HIV
infections and accessing prevention services and care. As the nation's
prevention agency, CDC must recognize and address barriers to disease
prevention and health promotion in order to fulfill our mission of
protecting the public health.
In June 2000, CDC convened a group of experts from across the
country to discuss the role stigma plays as a barrier to HIV
prevention. Several action steps were recommended, and CDC has been
working to implement many of them. Although there are numerous articles
describing research related to stigma and health effects, one area of
concern was the lack of specific data regarding HIV-related stigma,
particularly population-based data on which to base decisions regarding
communications and programs. As a first step in acquiring such data,
CDC conducted a study that was reported in the December 2000 issue of
the Morbidity and Mortality Weekly Report, which found that of the
6,000 American adults surveyed, 1 in 5 believed that people who got
AIDS through sex or drugs got what they deserved. This research
indicates that addressing this important subject is critical to our
efforts to decrease the number of persons becoming infected and to
ensure that those infected receive appropriate care and prevention
services.
Question 24. The Centers for Disease Control and Prevention is the
lead agency in the federal government to help prevent disease. Yet many
CDC programs focus on methods to reduce the consequences of risky
behavioral practices instead of preventing those behaviors in the first
place. In fact, in respect to HIV/AIDS and sexually transmitted disease
prevention, the CDC actively promotes condoms as the best protection
for preventing infection. What should be the response of the CDC should
medical data reveal that condoms are far less efficacious than was
previously thought?
Response: When important new scientific information becomes
available, CDC updates its policies and recommendations to reflect this
new information. For example, the 1995 recommendations for HIV
counseling and voluntary testing of pregnant women are being revised to
reflect lessons learned since the first guidelines were published.
Question 25. What criteria does CDC use in selecting members of its
HPPC? Does the CDC consider the views of members as part of a selection
process for membership on an HPPC?
Response: CDC requests clarification from the committee as to what
the acronym ``HPPC'' represents.
Question 26. Last year, Congress specifically directed federal HIV/
AIDS; care programs to include HIV data funding formulas to ensure that
racial and demographic disparities noted by the General Accounting
Office are eliminated. The Committee is concerned that states with
unreliable HIV tracking systems using on code reporting will continue
to shortchange minority communities. Can you assure us that by allowing
states to experiment with coded surveillance systems--which even the
CDC has fund to be faulty--that data will be properly and fully
reported so that these disparities will indeed be eliminated?
Response: CDC has adopted minimum performance standards for HIV
reporting that all States must meet over time. These standards were
published in the recent Guidelines for National Human Immunodeficiency
Virus Case Surveillance, Including Monitoring for Human
Immunodeficiency Virus and Acquired Immunodeficiency Syndrome. The
performance standards include using methods that provide complete and
timely data, result in accurate case counts, and ensure that
demographic and risk information is complete. In addition, States must
collect the recommended standard data in a reliable and valid manner,
allow matching to other public health databases (e.g., death
registries) to benefit specific public health goals, and allow
identification and follow-up of certain individual cases, such as
perinatally exposed infants, to identify infection status. To date, of
those States that have implemented HIV reporting using non-name-based
methods, none has completed CDC evaluations addressing all performance
standards. However, Massachusetts and Washington have had time to
establish routine surveillance methods for collecting HIV data. An
evaluation of how well the code identifies one and only one person has
been completed for these states. Both report that the current system
meets this aspect of the recommended performance standards. Other
performance criteria have not yet been evaluated in these states. One
other State, which previously published an initial evaluation, is
currently conducting CDC-recommended modifications to their evaluation
methods. CDC will continue to work with States to complete these
evaluations, strengthen their systems, and promote comparability of
data throughout the United States.
CDC collaborates with all 50 States, the District of Columbia, US
dependencies and possessions, and independent nations in free
association with the US to report AIDS cases using a uniform case
definition and report form. Basic elements collected on all cases
include information about the AIDS diagnosis, demographic
characteristics, exposure and death information. As of January 1, 2000,
CDC and the Counsel of State and Territorial Epidemiologists expanded
the surveillance case definition to include the reporting of HIV
infection and recommended that all areas conduct HIV case surveillance
as an extension of current AIDS case surveillance activities. As of
April 2001, 33 states, the Virgin Islands, and Guam have implemented
HIV case surveillance using the same confidential system for namebased
case reporting for both HIV infection and AIDS; two additional states
conduct pediatric surveillance only using the same method. Seven states
are currently using a coded identifier rather than patient name to
report HIV cases and three states are using names to initiate HIV
reports which are later converted to codes after public health
followup. Published guidelines for HIV surveillance include recommended
best public health practices and minimum performance standards for
integrated surveillance systems. Surveillance programs are currently
conducting or planning evaluation studies to measure the accuracy,
quality and timeliness of their HIV/AIDS surveillance systems.
Additional funding and technical assistance for evaluations of
integrated HIV/AIDS surveillance using standardized CDC protocols will
be announced in the fall of 2001.
In regard to the CARE Act, its goals and objectives focus on the
extent to which programs serve lowincome, medically underserved
populations and remove barriers and enhance access to care for these
vulnerable populations. HRSA is in the process of establishing an
interagency agreement with CDC in order to jointly pursue a task order
with the Institute of Medicine (IOM). This work will help determine
whether the core integrated HIV/AIDS surveillance system provides
adequate data to allocate Ryan White funds at the State and local
levels; what data can be used to determine a communities severity of
need for the purposes of resource planning and allocation; and what
data on HIV primary care and support services can be used to measure
outcomes and quality of services in low income, under and uninsured
populations. Section 501 of the Ryan White CARE Act Amendments of 2000
requires that the IOM conduct this study.
Specifically related to the use of HIV data in federal funding
formulas, the IOM study shall determine:
1. Whether the surveillance system of each of the states regarding HIV
provides for the reporting of cases in a manner that is
sufficient to provide adequate and reliable information on the
number and demographic characteristics of cases, at the State
level and for specific geographic areas within the state.
2. Whether the case reports are sufficiently accurate for purposes of
formula grants under parts A and B of title XXVI of the PHSA.
If the study identifies inadequacies or unreliable information, the
IOM is to make recommendations for improvements in the core
surveillance system. Not later than July 1, 2004, The Secretary shall
take into consideration the findings of this study in rendering a
determination as to whether there is data on cases of HIV disease
suitable for such use in allocating funds.
Question 27. How will you ensure that recent changes to Ryan White
will only pay for ``support services that are health care related?''
What are your plans to evaluate grantees that expend resources on non-
health care related activities? How will programs be evaluated that
expend resources from any source that encourage or destigmatize risk
behaviors?
Response: The HRSA HIV/AIDS Bureau has through letters, program
guidance and technical assistance activities informed all of the CARE
Act Title I and II grantees and Planning Councils, about the new
amended CARE Act requirements regarding health related support
services. We will monitor grantee compliance through ongoing program
monitoring activities such as site visits, monthly monitoring calls,
and review of progress reports and expenditure data. Moreover, the HIV/
AIDS Bureau each year reviews the amount of funds allocated by Title I
and II grantees to several service areas. This activity has been under
way for some time so there is sufficient information to assess any
significant changes in the grantees funding of support services.
Where we find inconsistencies with this guidance and policies we
will allow grantees reasonable time to correct the inconsistency.
Failure to satisfactorily correct the inconsistency could result in the
imposition of grant restrictions.
Annual application guidance to grantees asks them to describe and
discuss the impact of non-CARE Act funding which assists in the
provision of HIV care and treatment services. We view this area as very
important because it demonstrates the grantees ability to successfully
coordinate CARE Act funds with other appropriate funding streams. CARE
Act funds are viewed as the A payer of last resort and therefore should
not be used to pay for services where it is expected that services be
covered under any other Federal or State program.
HRSA has recently completed a series of locally based evaluations
that look at the association of the provision of support services and
entry into and retention in HIV primary care. The results from these
targeted evaluations will soon be disseminated along with descriptions
of methodological approaches for such evaluations. HRSA is currently in
discussion regarding a proactive technical assistance approach that
supports local evaluations and provides useful methods for conducting
focused evaluations with limited resources.
Question 28. Last year, Congress passed and the President signed
legislation to address the prevention of Human Papillomavirus infection
(P.L. 106-554). What is the status of the enactment of this law?
Response: CDC has begun research efforts to help develop science-
based messages and educational materials regarding human papillomavirus
(HPV) prevention and consequences of infection. They will be based on
sentinel surveillance and epidemiological studies to better define
prevalence and progression of HPV and its health consequences;
formative research on HPV knowledge and attitudes about HPV healthcare
and sexual behaviors, as well as HPV informational needs; and a
healthcare provider survey of perceptions, healthcare practice,
barriers and facilitators to HPV risk assessment, diagnosis, treatment,
counseling and partner services.
CDC is working to ensure that any educational materials on STDs,
and HPV in particular, which are under development, are in compliance
with the requirements of P.L. 106-544. CDC's National Center for HIV,
STD, and TB Prevention has informed its HIV and STD grantees,
subgrantees, contractors, and a wide range of public health partners
about the requirements of P.L.106-554, especially these requirements
regarding educational materials. Organizational components of CDC
affected by the legislation have been similarly notified. In addition,
CDC has notified both the National Coalition of STD Directors and the
National Alliance of State and Territorial AIDS Directors who represent
state and local health department STD and HIV programs.
Question 29. The budget plan includes a request for $20 million for
the purposes of increasing organ donation. How will those resources be
used to increase donation among minorities who have very low donation
rates?
Response: A large portion of HRSA's donation funds supports a grant
program focused on model interventions to increase donation. Sixty-five
percent of the currently funded projects specifically target
minorities. HRSA will continue to emphasize the need for minority-
focused projects in at least the same proportion.
In addition, as the key HHS agency responsible for implementing
Secretary Thompson's new campaign to increase donation, HRSA is
currently developing an outreach strategy to involve minority
businesses and organizations. As part of this strategy, outreach
efforts have already begun with the NAACP and other minority
organizations.
In keeping with the Administration's interest in working with faith
communities, HRSA will work with the Congress of National Black
Churches (CNBC) to promote organ and tissue donation through CNBC's
membership of more than 65,000 churches and 20 million individuals.
HRSA will also implement a strategy to encourage donation through
community health centers, the clientele of which is approximately 43
percent minority.
HRSA plans to promote minority donation in various other ways.
Among these are exhibiting at minority meetings and conferences,
developing brochures and other education materials targeted
specifically to minorities, and promoting donation on the campuses of
Historically Black Colleges and Universities, Hispanic Serving
Institutions, and schools with high Asian populations.
Question 30. What is going to be HHS's approach to the organ
allocation regulation, which went into effect last year? As Governor,
you filed suit to enjoin the agency from enforcing the rule. What will
be the approach to revising or modifying the Clinton Administration's
rule?
Response: The suit to enjoin the agency from enforcing the rule has
been withdrawn. There are no plans to rescind or change the rule. The
Department is enforcing the rule and is working cooperatively with the
transplant community to implement the rule in a very fair and balanced
manner. There has been good progress toward fulfilling the requirements
of the rule. For example, the Organ Procurement and Transplantation
Network has proposed, and is testing the feasibility of a new liver
allocation policy that would greater emphasis on patients' illness
severity and less emphasis on waiting time as a basis for priority on
the waiting list.
Question 31. The HHS budget on page 5 requests $33 million for a
new program to support group homes for teenage mothers. How will the
Department ensure that women seeking counsel or treatment at Title X-
funded programs will receive information about this program? How will
the Infant Adoption Awareness Act be coordinated with the program
supporting homes for teenage mothers?
Response: The President's budget for FY 2002 requests $33 million
to fund Maternity Group Homes, community-based, adult supervised group
homes for young mothers and their children. These homes will provide
safe, stable, nurturing environments for mothers who cannot live safely
with their own families and will assist them to move forward with their
lives by helping them to complete their education, obtain job skills
and learn to be good parents. The budget also requests $10 million to
continue funding the Infant Adoption Awareness Act, first authorized
and funded by Congress in FY 2001. That program is intended to train
designated staff of eligible health centers (including Title X family
planning clinics) in providing accurate adoption information and
referral to pregnant women on an equal basis with all other courses of
action included in nondirective counseling to pregnant women
Because women facing unexpected pregnancies may be in need of a
multitude of services, the Department will also ensure that eligible
health centers are provided with information on the Maternity Group
Homes (providing funds are appropriated for that initiative) for their
clients who may be in need of that type of program. In addition,
subject to the availability of funds, the Department will ensure that
Maternity Group Home grantees receive information on adoption
information and referral for young women who might choose to place a
baby for adoption after entering a Maternity Group Home program.
Question 32. Could you please describe some of the ongoing
initiatives and activities at the Office of the Secretary's Office for
Human Research Protections?
Response: The recently created Office for Human Research
Protections (OHRP), together with other HHS agencies, launched a new
approach to the protection of human subjects in research, one based
upon the concept that the primary responsibility of everyone involved
in the human research process is to protect the rights, interests and
well-being of those individuals who voluntarily participate in research
activities. The new system will not to be simply an improvement of the
existing oversight and sanction approach, but a system focused on
prevention. The Department's reform plan specifically addresses the
five major recommendations of HHS' Office of Inspector General (OIG in
its 1998 Report.
Working with other federal agencies, OHRP has developed and
implemented a unified Federal registration system for all human
research review boards, regardless of the source of research funding.
This will provide an important database for improved communications
with IRBs and an important first step toward establishing greater
uniformity in the IRB process. In December 2000, OHRP implemented a
simplified assurance process. With the resources freed from the former,
overly complex assurance process, OHRP is implementing a new program
that emphasizes education and support as part of a broad quality
improvement effort that will be administered through a combination of
proactive site visits, video conferences, and directed self-
evaluations. The assessment tools and procedures are undergoing pilot
testing in voluntary cooperation with institutions across the country
in anticipation of formal implementation. When fully implemented, and
with sufficient resources, OHRP expects to conduct 60 quality
improvement evaluations every month, and will conduct quality
improvement evaluations at every major medical school in the United
States during the first year of the program.
For greater uniformity and public accountability in the review and
approval process, OHRP, through the Department, contracted last October
with the Institute of Medicine (IOM) of the National Academy of
Sciences to recommend uniform performance and resource-based standards
for private, voluntary accreditation of human research protection
programs. In April 2001, the IOM issued its report on accreditation of
human research protection programs, and pilot testing began in July
2001 in selected medical centers in the Department of Veterans Affairs
and other institutions, including NIH. Having completed the first phase
of its project, the IOM began work on a study of the evolving human
research system to determine the extent to which the issues and
concerns raised by the OIG, the General Accounting Office, the National
Bioethics Advisory Commission, and other national groups are being
addressed within the current program of reform. The IOM working group
has also been charged with developing objective measures for the
effectiveness of the system for protection of human subjects in
research.
OHRP, the FDA, the NIH, and other federal agencies have just
launched an effort to carefully examine the continuing review process
and to develop guidance for institutions and review boards regarding
appropriate mechanisms for ongoing monitoring of approved research,
particularly recognizing the need for more effective monitoring and
management of adverse events. Toward this end, the Department will seek
support for the development and implementation of an integrated
electronic information system and database to carry out this process.
In the past year, OHRP staff members have given over 50
presentations to institutions, IRBs, investigators, and professional
societies. In February, OHRP and the DHHS Office of Research Integrity
hosted the first Human Research Education Summit, attended by
representatives from both the academic and corporate sectors, as well
as representatives from almost every federal agency subscribing to the
Common Rule. This meeting was an initial step toward developing a
system of shared resources and best practices. A second summit is
scheduled for August 2001. OHRP has developed and implemented web-based
educational modules for institutional officials, IRB managers, and IRB
chairs to ensure that these individuals are fully cognizant of their
responsibilities under their assurances.
IRBs and institutions are trying to shoulder what seems to be an
ever-increasing burden of compliance activities. OHRP is convening the
SUEE Task Force (Simplicity, Uniformity, Efficiency and Effectiveness)
with the Human Subjects Research Subcommittee (HSRS) later this fall to
identify and recommend opportunities for reducing unproductive
administrative burdens. At the Executive Branch level, the HSRS,
chaired by the Director of OHRP, is working to integrate the activities
of federal offices, agencies and departments that share
responsibilities in this oversight process. Under its charter, the
working groups of HSRS have taken on issues such as conflicts of
interests in clinical research and appropriate application of the
federal policy for protection of human subjects in non-biomedical,
social and behavioral sciences research. The HSRS has become the
Acentral nervous system of the federal system for human research
oversight. Its role and its effectiveness continue to grow.
Following the very successful August 2000 HHS-sponsored conference
on financial conflict of interest and human subject protection, an HHS
working group developed and in January OHRP disseminated widely for
comment the A Draft Interim Guidance Financial Relationships in
Clinical Research: Issues for Institutions, Clinical Investigators, and
IRBs to Consider When Dealing With Issues of Financial Interests and
Human Subject Protection on the OHRP website and taking steps to expand
its scope to include all Common Rule agencies. Next steps include
reviewing the comments received from the public and NHRPAC, revising
the document, and then formally sharing the revised document with the
human subject protection community for additional suggestions. The
Department anticipates publication of new guidance this fall.
Last March, OHRP created a new component Office for International
Activities to lead and coordinate Departmental activities in the
international domain. OHRP is working with the World Medical
Association, the European Forum on Good Clinical Practice, the Council
of International Organizations of Medical Societies and other
international organizations to refine the interpretation and
application of the revised Declaration of Helsinki.
Question 33. When will the HHS review on the meaning of the Dickey
Amendment regarding human embryo experimentation be completed?
Response: The Dickey appropriations rider prohibits the use of
federal funds for ``research in which a human embryo or embryos are
destroyed, discarded, or knowingly subjected to risk of injury or death
greater than that allowed for research on fetuses in utero.'' The
Administration has determined that the research that the President has
agreed to fund (using existing stem cell lines where the life and death
decisions have already been made) does not violate the Dickey
amendment. No Federal funds will be used for the destruction of human
embryos or the derivation of stem cells, and no Federal funds will be
used for research on stem cell lines created from human embryos that
are alive as of this date. HHS will fund research and will conduct its
own research consistent with this determination.
Question 34. Because many faith-based organizations direct the
majority of their resources to services, they often have little
expertise to navigate the maze of federal grant programs that could
help them serve the sick and needy. What steps do you think need to be
made to educate and assist faith-based organizations so that they have
an equal opportunity to the assistance the federal government provides
non faith-based community organizations?
Response: In order to build the capacity and competency of
charitable faith-based organizations, this Administration proposes the
establishment of a Compassion Capital Fund and Best Practices Research
Initiative. Under this proposal, a national funding source would be
established to support charitable organizations in expanding or
emulating model social service agencies through public-private
partnerships. The organizations supported by this funding source would
work with community and faith-based organizations in:
--providing technical assistance to help small community and faith-
based charities increase their capacity to provide service
delivery, improve competence and expand program availability;
--operating a revolving loan fund to provide bridge loans which would
enable smaller groups to cope with the slow flow of
procurement; and
--providing grants for start up and operation to qualified charitable
organizations.
These capacity-building entities also would be responsible for
obtaining private matching funds to support their efforts, in addition
to their responsibilities in assisting community and faith-based
organizations. Further, we propose the establishment of a national
funding source to support and promote research on A best practice among
charitable organizations, called the Best Practices Research
Initiative. This new authority would be created specifically to
research and disseminate information on the effectiveness of service
programs for low-income individuals operated by charitable social
service organizations. Information regarding successful programs
identified through the Best Practices Research Initiation would be
disseminated among charitable organizations so that such models could
be duplicated and expanded.
The FY 2002 budget request for the Compassion Capital Fund is $67
million, and for the Best Practices Research Initiative, the budget
request is $22 million.
Question 35. Research has found that families that contain a mother
and a father provide significant health and behavioral benefits to
their children. What steps are you taking to make sure HHS programs
strengthen families, and support marriage and responsible fatherhood?
Response: We have funded eight-child support enforcement
responsible fatherhood demonstration projects that will help bolster
fathers' financial and emotional involvement with their children. Each
project is different, although they all provide a range of services to
aid in collecting child support, such as job training, access and
visitation, and social services.
We have provided over $1.5 million to the National Center for
Strategic Nonprofit Planning and Community Leadership (NPCL) to work
with grassroots fathers' organizations to help unemployed and
underemployed fathers become responsible parents. In addition, we have
approved ten State waivers supporting the Partners for Fragile
Families, a set of projects to test ways for child support enforcement
programs and community and faith-based organizations to work together
to improve the opportunities of young, unmarried fathers to support
their children both financially and emotionally. Further, Personal
Responsibility and Work Opportunity Reconciliation Act (PRWORA),
created a $10 million access and visitation program for States, serving
more than 22,000 individuals in 1997 and an estimated 50,000 in 1998.
Most recently, President Bush and I made a clear commitment to
promoting involved, committed and responsible fatherhood as a national
priority by emphasizing it the FY 2002 budget request. One of the many
goals of the Administration's FY 2002 proposal is to provide $64
million for the first year to support low-income families by helping
low-income non-custodial parents (mainly fathers) support their
children by paying child support and connecting or reconnecting with
their children.
Question 36. The budget request includes $10 million for the Infant
Adoption Awareness program, enacted as a part of the Children's Health
Act. How will HHS ensure that women seeking pregnancy options
counseling at federally funded centers receive information and referral
on adoption? Aren't they required to provide this information already?
Response In order to implement Title XII, Subtitle A, Infant
Adoption Awareness of the Children's Health Act, the Department will
enter into cooperative agreements for the purposes of developing and
implementing programs to train designated staff of eligible health
centers in providing accurate adoption information and referral to
pregnant women. Although some adoption counseling may already be
provided by federally funded health centers, studies show that adoption
is an infrequent outcome for women who go to title X clinics.
Implementation of this legislation will ensure that clear and accurate
information about adoption is presented, giving women choices and the
opportunity to make decisions based on clear and accurate information.
Question 37. How will the $89 million Compassion Capital Fund
works? How will effective charitable programs and social service
organizations be identified?
Response: The FY 2002 budget includes $89 million for a new
Compassion Capital Fund. The Fund will support several grants to
public/private partnerships to provide start-up capital and operating
funds to qualified charitable organizations that wish to expand or
emulate model social service programs.
The fund will also provide funds for research on best practices
among charitable organizations.
The HHS Center for Faith-Based and Community Initiatives and the
Administration for Children and Families (ACF) are working with the
White House Office of Faith-Based and Community Initiatives to develop
guidelines or recommendations for specific proposals from charitable
organizations.
Question 38. The Administration is requesting $90 million for the
Healthy Start program. Will the Bush Administration help seek funding
for initiatives recently authorized by this Committee within the
Healthy Start program, such as mobile health clinics and pre-natal
surgery?
Response: Health centers funded under section 330 of the Public
Health Service Act provide, either through the staff or through
contracts or cooperative arrangements, primary health services for all
residents of the area served by the center. The required primary health
services are defined at section 330(b) and include preventive health
services with voluntary family planning services specifically
identified. The HRSA's Bureau of Primary Health Care issued a policy
notice on August 17, 1998, entitled Health Center Program Expectations,
describing its expectations for all health center programs covered
under section 330. The program expectation related to Clinical Systems
and Procedures requires health centers to have written policies and
procedures that address a number of elements including the use of
clinical protocols. These clinical protocols should reflect the current
guidelines established by health agencies or professional
organizations. For example, the Guidelines for Women's Health Care
issued by the American College of Obstetricians and Gynecologists
indicates that, in the event of an unwanted pregnancy, the patient
should be counseled about her options, one of which is to continue the
pregnancy to term and offer the infant for legal adoption. Further, we
are confident that the Infant Adoption Awareness training to be offered
to health center staff will serve to enhance their knowledge about
providing adoption information. Monitoring of health centers' use of
appropriate clinical protocols is accomplished either through national
accreditation reviews or the Bureau's Primary Care Effectiveness
Reviews.
Question 39. How does the budget reduction for training health
providers effect pharmacist training?
Response: The training of allied health care professionals under
the Title VII Section 755 grant authority does not include the training
of pharmacists. Pharmacists are excluded by definition as an allied
health provider as are physicians, dentists and registered nurses. The
budget reduction would, therefore, have no effect on pharmacist
training. It would have a possible impact on the training of pharmacist
technicians since they are considered an allied health profession.
Question 40. Can we expect a specialty designation for
interventional pain physicians? If so, when?
Response: Recognized medical specialties in the United States meet
the requirements of, and are recognized by, the American Board of
Medical Specialties (http://www.abms.org), a private non-governmental
501(c)(3) organization. Additionally, there are special certifications
for subspecialties within some, but not all, ABMS member organizations.
A subspecialty pain certification is currently available through these
recognized specialties: anesthesia, psychiatry and neurology, and
physical medicine and rehabilitation.
All physicians should be familiar with basic pain management
techniques and many disciplines include it in certification
requirements and examinations. The discipline pf palliative care and
American Board of Hospice and Palliative Medicine (ABHPM) focuses on
pain management as well as management of other symptoms (such as
shortness of breath, fatigue, and nausea) which cause suffering in the
ill. The ABHPM has not been recognized by the ABMS and the desirability
of doing so is subject to considerable debate and discussion.
Question 41. Congress mandated HCFA to implement a national
Medicare ambulance fee structure by January 2000, and despite HCFA
having its negotiated rulemaking Committee's recommendations in hand
for over nine months, it has failed to release final regulations. And,
in keeping with reimbursement policies enjoyed by the other 48 states,
Congress also mandated that HCFA reimburse in-country ambulance mileage
for both North Carolina and Tennessee by July 1, 2001, which the agency
has also delayed. When will we see implementation of these two very
important congressional mandates?
Response: CMS published the proposed ambulance fee schedule on
September 12, 2000. Although the proposed rule was based on the
negotiated rulemaking committee's recommendations, over 340 comments
were received by the end of the comment period on November 13, 2000.
CMS is carefully reviewing and analyzing all of the comments as they
prepare the final rule. CMS shares your interest in implementing the
fee schedule and is working expeditiously to publish the final rule.
Section 423 of the Medicare, Medicaid, and SCHIP Benefits
Improvement and Protection Act, required CMS to structure the phase-in
of the ambulance fee schedule so that the Agency make payments for in-
county mileage in certain states (e.g., North Carolina and Tennessee)
for both the fee schedule portion of the payment, as well as the
portion of the payment that is calculated under the payment method in
place prior to the implementation of the fee schedule. This provision
will be implemented concurrently with the fee schedule.
Question 42. North Carolina runs one of the most successful SCHIP
programs in the United States. Unfortunately, last year the state was
forced to freeze enrollment at 69,000 because the number of children
wanting to enroll in Health Choice (100,000+) far exceeded the federal
government's estimated number of potential enrollees (71,000). North
Carolina simply did not have a large enough allocation from the federal
government because of the poor estimate. Are you interested in revising
future allocations using more accurate numbers?
Response: As you may know, in November 2000, North Carolina
submitted their 5th amendment to establish a freeze on new enrollments
in SCHIP. The amendment was approved in February 2001. At the time of
the freeze, however, North Carolina had budgeted only $61.3 million of
the $89.2 million in federal funds allotted to the state for FY 2000.
The SCHIP allocation formula was revised in the Balanced Budget
Refinement Act which made changes to the SCHIP allotment formula
stabilizing State allotments, imposing floors and ceilings on changes
from one year to the next, and using a blend of low-income children and
uninsured children starting in FY 2000. The Balanced Budget Refinement
Act also included $10 million for the Department of Commerce to
increase the sample size of the Current Population.
Survey to increase the reliability of the estimates of uninsured
children by age, income, and race on a State by State basis. These
changes, in combination with additional state funds, will enable North
Carolina to enroll eligible children now on a waiting list and use all
of their federal SHIP allotments.
Question 43. Last year, Congress passed and the President signed
into law the Pubic Health Threats and Emergencies Act. How does the
Department's FY'02 budget request reflect needed changes,
infrastructure improvements and the like as required by that
legislation?
Response: The Public Health Improvement Act authorizes HHS to
undertake a broad range of activities to ensure that the Nation's
health and medical systems are prepared in the event of bioterrorist
attack. The Department's FY 2002 budget includes $353 million, an
increase of $50 million (+17%) over FY 2001 and $93 million (+35%)
above FY 2000, for the Department's bioterrorism preparedness
activities authorized under the act. This includes:
Bioterrorism Core Activities: $322 million from funds solely
dedicated to HHS's Bioterrorism initiative, including
surveillance and medical response activities.
NEDSS: $27 million for the National Electronic Disease
Surveillance System (NEDSS) at CDC, which supports bioterrorism
detection and, communication in addition to surveillance for
naturally occuring infectious diseases.
Centers for Public Health Preparedness: $4 million provided to
CDC's partners at State public health departments and academic
institutions for demonstration projects designed to implement
new technologies and training for bioterrorism preparedness and
other public health emergencies.
The Act authorizes the Secretary of HHS, in coordination with the
Secretary of Defense to establish a joint interdepartmental working
group on preparedness and readiness for the medical and public health
effects of a bioterrorist attack on the civilian population. The
working group is tasked with the following responsibilities:
Coordinate research on likely bioterrorist pathogens including
development of detection equipment, and shared standards for
detection and protection (319F (a)(1)(2)(3)); Develop
priorities for future research related to bioterrorism
epidemiology, pathogenesis, and development of vaccines,
therapeutics and medical diagnostics (319F(f)(1)(2)(3)(4)):
$123 million, an increase of $21 million (+20%) over FY 2001
and +$28 million (+29%) over FY 2000 for NIH biomedical
research, CDC anthrax efficacy studies and development of the
rapid toxic screen and smallpox and anthrax vaccine research
and development.
Coordinate the development, maintenance and procedures for the
release of strategic reserves of pharmaceutical supplies needed
after a bioterrorist attack (319F(a)(4)): $53 million for the
maintenance and deployment planning of the National
Pharmaceutical Stockpile at CDC and the National Medical
Response Team medical caches supported by the HHS Office of
Emergency Preparedness (OEP).
Train health care and public health personnel to recognize
symptoms of bioterrorism, rapidly identify the pathogens, and
coordinate medical care (319F(c)(3)(A)(B)(C)): $64 million, an
increase of +$17 million (+34%) above FY 2001 and +$25 million
(+61%) above FY 2000 for CDC support of the Epidemic
Intelligence Service, State & local planning and
epidemiological capacity, and OEP's support of medical response
teams, Metropolitan Medical Response Systems and training of
medical and other personnel at Noble Training Center.
Coordinate rapid communication of data generated from a
bioterrorist attack between national, State and local agencies
and health care providers (319F(c)(3)(A)(B)(C)): $71 million,
an increase of +$9 million (+15%) over FY 2001 and +$21 million
(+43%) over FY 2000 for development of the Health Alert
Network, the National Electronic Disease Surveillance System
(NEDSS), and the Department's new Cyber-Security Initiative to
protect and improve HHS information systems needed for
bioterrorism preparedness and response.
Develop and implement education programs to instruct public
health and medical officials to recognize and treat victims of
bioterrorism, and laboratory personnel to identify potential
bioterrorist pathogens (319F(e)(1)(2)): $38 million, an
increase of +$4 million (+10%) over FY 2001 and +$18 million
(+86%) over FY 2000 for CDC's national planning for
preparedness and response, implementation of the Select Agent
rule and laboratory training and support.
Make grants for not more than three demonstration projects to
improve detection of pathogens and development of plans and
measures to respond to bioterrorism (319G(a)). Demonstration
Projects to Improve Detection and Planning: $3.5 million, an
increase of +$.5 million (+17%) over FY 2000 for Centers of
Public Health Preparedness communications and training related
to bioterrorism.
Question 44. What other steps does HHS intend to take to improve
our nation's public health infrastructure? How are those steps
reflected in the budget?
Response: The Fiscal Year 2002 Budget reflects a major change of
displaying CDC's public health infrastructure programs in a single
line, allowing for greater coordination and accountability in the areas
that constitute Public Health Improvement: strengthening public health
practice, awarding prevention grants to universities, eliminating
racial and ethnic health disparities, building the National Electronic
Disease Surveillance System, and building cross-cutting capacities and
expertise. Categorical programs such as antimicrobial resistance and
bioterrorism preparedness and response build upon these foundational
activities. Within this new line, an increase of $1 million is targeted
to begin implementation of the infrastructure portion of the Public
Health Threats and Emergencies Act. Activities planned for FY02 include
developing capacity performance standards for public health systems,
measuring gaps, and building standards-based capacity on the foundation
lay by the National Public Health Performance Standards Program. The
following activities are included in the FY2002 budget and illustrate
how HHS will work to improve the nation's public health infrastructure:
Provides technical assistance to 50 states to establish rapid
communications capacity, access to training via distance-
learning mechanisms, and Internet access for local public
health officials through the Health Alert Network;
Continues work with public health partners on the Global and
National Implementation Plan for Public Health Workforce
Development and, as part of this plan, the continuation of the
Centers for Public Health Preparedness based in schools of
public health;
Supports the Public Health Grand Rounds program, a combined
broadcast/Web-cast series of public health program and case
studies, with live satellite programs on such topics as
Disaster Management, Genetics, and Asthma;
Monitors and provides technical assistance for the 55
prevention grants to universities, with investigators at
schools of public health, state and local health departments,
and other academic- and practice-based organizations;
Provides states with the capacity to tailor prevention
programs to their health priority needs through the Preventive
Health and Health Services Block Grant. The strategy behind the
Block Grant is that it can be used to fund categorical services
that may otherwise go unfunded. It can also supplement priority
state programs funded through other means. States can use the
Block Grant to address urgent, rapidly developing health
hazards such as those that would occur during a bio-terrorism
event. Funds could also be used for preparedness activities.
For example, one state funded the development of a medical and
health preparedness emergency response system for eight
counties using monies obtained through the Block Grant.
A strong public health infrastructure is necessary if the US is to
mount a rapid, effective, response to a bioterrorism event. Building on
the activities targeted to improve public health infrastructure
overall, the FY02 Budget provides a total of $182 million for CDC's
bioterrorism preparedness activities. These funds will enable CDC to
continue to assist states, US territories, and major metropolitan areas
to develop and maintain core capacity for the primary components of a
bioterrorism preparedness and response effort. For example,
bioterrorism activities targeted for increased funds in the FY02 Budget
include the following:
Updating a national strategy for public health preparedness
for bioterrorism;
Increasing the detection and investigation capabilities for
infectious disease outbreaks and rapid collection, analysis and
dissemination of data;
Rapid laboratory diagnosis of biologic agents and
identification and management of chemical exposures; and
Maintaining the National Pharmaceutical Stockpile to assure
rapid availability of pharmaceuticals, supplies and medical
equipment in the event of an attack. The Stockpile includes 8 A
push packages containing antitoxins, therapeutic drugs,
antidotes, and other supplies ready for rapid deployment to the
site of a bioterrorism incident.
Antimicrobial resistance (AR) continues to be a worsening global
problem that affects virtually all of the pathogens previously
considered being readily treatable. Many important drug options for the
treatment of common infections are becoming increasingly limited and
expensive, and in some cases, nonexistent. In collaboration with
numerous federal partners, A Public Health Action Plan to Combat
Antimicrobial Resistance, released in January 2001, addresses this
growing problem. The Action Plan calls for (1) developing a coordinated
national AR surveillance plan for monitoring AR in microorganisms that
pose a threat to public health; (2) promoting the appropriate use of
antimicrobial drugs and preventing the transmission of infections
(whether drug-resistant or not); (3) increasing our understanding of
microbial physiology, ecology, genetics and mechanisms of resistance,
and translating research findings into clinically useful products, such
as novel antimicrobial therapeutics, diagnostic tests, vaccines and
other tools that prevent AR emergence and spread; and (4) developing or
evaluating new products to prevent, diagnose, and treat infections.
With sustained funding of $25 million, CDC will continue the following
activities:
Provide grants to academic research institutions for applied
research on antimicrobial resistance;
Provide support to state/local health departments and
healthcare systems for surveillance, prevention, and control of
antimicrobial resistance; and
Implement comprehensive community-based demonstration projects
on antimicrobial resistance prevention and control.
Question 45. Does the Department foresee any changes in the
operations of the Office of Emergency Preparedness? Is the $14 million
request sufficient for the office to provide medical and health-related
services under Emergency Support Function 8 of the Federal Response
Plan?
Response: The Department foresees some changes in OEP's activities.
We will be expanding the number of Metropolitan Medical Response
Systems (MMRS) beyond the original 120 envisioned in the Defense
Against Weapons of Mass Destruction Act of 1996. OEP will be working
with communities to link the local MMRS with rural areas as well as
state systems. In addition, OEP will be working with hospitals to
ensure that they are linked to MMRS activities and are prepared to
accept WMD victims. The $14 million request in the General Departmental
Management (GDM) is a part of the overall OEP budget request for FY
2002. While the budget request is divided between GDM and the Public
Health and Social Services Emergency Fund (Emergency Fund), the request
is not divided between ESF #8, WMD, or chemical, radiological or
biological terrorism. Rather, the request encompasses an all hazards
approach to disaster response. Similar to CDC's approach to building a
bioterrorism response on a sound public health infrastructure, OEP has
continued to build on a basic disaster preparedness and response for
mass casualties and impacts to the health and medical infrastructure.
The FY 2002 President's budget request for OEP (GDM and Emergency Fund)
is sufficient for current infrastructure activities, as well as for the
special WMD activities (MMRS, hospital development, Noble Training
Center, and NMRT equipment, team maintenance and training/exercises).
Provision of ESF #8 activities as part of the Federal Response Plan is
centered in the all hazards approach to the emergency preparedness
infrastructure.
Question 46. Can the Department describe its pharmaceutical
stockpile management agreement with the Department of Veterans Affairs?
Does HHS intend to continue using the VA to manage the medical response
teams' stockpiles on a daily basis?
Response: CDC has responsibility for managing all aspects of the
National Pharmaceutical Stockpile. CDC has a memorandum of agreement
with the DVA's National Acquisition Center which enables CDC to utilize
the multi-billion dollar purchasing power of the VA in procuring
pharmaceuticals, medical supplies and equipment for the National
Pharmaceutical Stockpile. However, CDC maintains full management
responsibility for all aspects of the stockpile, including that
purchased through the National Acquisition Center. Can the Department
describe its pharmaceutical stockpile management agreement with the
Department of Veterans Affairs? Does HHS intend to continue using the
VA to manage the medical response teams stockpiles on a daily basis?
OEP has an agreement with VA to provide daily management of OEP's
medical response team stockpiles. VA ensures that: the stockpiles are
stored in secured facilities, with appropriate temperature and other
controls; inventory records are maintained; the pharmaceuticals are
appropriately rotated as expiration dates approach; HHS/OEP intends to
continue to use the VA for this activity.
Question 47. Does HHS intend to expand the number of Disaster
Medical Assistance Teams (DMATs) or National Medical Response Teams
(NMTTs)?
Response: At this time, we do not have plans to increase the number
of NMRTs (which currently total four). However, we are trying to
increase the number of NMRT members in order to ensure that full team
complements can be deployed as required. HHS is always ready to
increase the number of DMATs, and we actively recruit team members as
well as new teams and their sponsors. In addition, OEP works to
increase the number of level-1 DMATs. These are teams that can field 35
medical professionals and support staff, can be ready to deploy to a
disaster area within hours, and can be self-sufficient in hazardous and
austere conditions for up to 72 hours. Currently, the National Disaster
Medical System has a total of 27 level-1 teams.
Question 48. Does the Department foresee the various bioterrorism
programs operated by the agency (Office of Emergency Preparedness, CDC,
etc) working together?
Question 49. Your written testimony on page 18 indicates that there
are still problems with the privacy regulation that will have to be
fixed through guidelines and additional modifications. What kinds of
changes do you believe are necessary?
Response: On July 6, 2001, the Department issued the first guidance
package on the Privacy Rule. The guidance provided is meant to
communicate as clearly as possible the privacy policies contained in
the Rule. Each section has a short summary of a particular standard in
the Privacy Rule, followed by ``Frequently Asked Questions'' about that
provision. Among the privacy provision addressed in the guidance
material are consent, minimum necessary, oral communications, business
associates, parents and minors, health-related communications and
marketing, research, and restrictions on government access to health
information. Additional guidance materials and other forms of technical
assistance will be provided by the Department to facilitate
implementation of and compliance with the Privacy Rule. In addition,
the guidance identified areas of the Privacy Rule where a modification
or change to the rule is necessary. For example, standards in the
Privacy Rule for which we will propose changes are:
Phoned-in Prescriptions--A change will permit pharmacists to
fill prescriptions phoned in by a patient's doctor before
obtaining the patient's written consent.
Referral Appointments--A change will permit direct treatment
providers receiving a first time patient referral to schedule
appointments, surgery, or other procedures before obtaining the
patient's signed consent.
Allowable Communications--A change will increase the
confidence of covered entities that they are free to engage in
whatever communications are required for quick, effective, high
quality health care, including routine oral communications with
family members, treatment discussions with staff involved in
coordination of patient care, and using patient names to locate
them in waiting areas.
Minimum Necessary Scope--A change will increase covered
entities' confidence that certain common practices, such as use
of sign-up sheets and X-ray lightboards, and maintenance of
patient medical charts at bedside, are not prohibited under the
rule.
We continue to review the input received during the recent public
comment period to determine what changes are appropriate to ensure that
the rule protects patient privacy as intended without harming
consumers' access to care or the quality of that care. Other changes to
the Privacy Rule may, therefore, be considered as appropriate. For
example, HHS may reevaluate the Privacy Rule to ensure that parents
have appropriate access to information about the health and well-being
of their children.
Question 50. How will the Department distinguish State laws that
are to be superceded and those, which are to remain, unimpaired?
Response: The statute provides specific criteria for which State
laws are exempt from preemption by the Privacy Rule. State laws that
meet the statutory criteria will remain unimpaired. In addition, the
Privacy Rule provides a definition of ``more stringent'' which should
aid in the identification of State laws which are exempt from
preemption.
Question 51. What are the staffing and budgetary requirements for
enforcement of this regulation by the Office of Civil Rights?
Response: In FY 2001, the Office for Civil Rights (``OCR'')
received $3.4 million for implementation and compliance activities
associated with the Privacy Rule. In FY 2002, OCR has requested $ 5
million, which will allow for staffing of 33 FTEs focused on education,
policy guidance and technical assistance activities. The resources
required for compliance monitoring and enforcement will be reflected in
OCR's FY 2003 budget request, since the rule will not be enforceable
until April 2003.
Question 52. What is the impact of the privacy rule for the
Medicare and Medicaid Programs and providers (such as Pharmacy Benefit
Managers) participating in the programs?
Response: [Referred to CMS for response]
Question 53. According to a letter dated March 12, 2001 from
American Psychiatric Association (``APA'') to you, Mr. Secretary,
``Patients will lose some existing privacy protectionY as a result of
the regulationY For example, currently when hospitals or doctors
receive a request for a medical record from an attorney for civil and
administrative purposes, they will generally not disclose medical
records information without notice to the patient and /or the patient's
consent. But the new regulation would allow providers to disclose
medical records information to attorneys who write a letter `certifying
that the Y information requested concerns a litigant to the proceeding
and that health condition of such litigant is at issue.' These
procedures provide no check on attorney's behavior in requesting
records of marginal relevance to a case or for the purpose of
embarrassing or intimidating opposing parties.'' Is this an area that
you believe will need to be changed?
Response: According to a letter dated March 12, 2001, from American
Psychiatric Association (``APA'') to you, Mr. Secretary, ``Patients
will lose some existing privacy protection . . . as a result of the
regulation. For example, currently when hospitals or doctors receive a
request for a medical record from an attorney for civil and
administrative purposes, they will generally not disclose medical
records information without notice to the patient and/or the patient's
consent. But the new regulation would allow providers to disclose
medical records information to attorneys who write a letter `certifying
that the information requested concerns a litigant to the proceeding
and that health condition of such litigant is at issue.' These
procedures provide no check on attorney's behavior in requesting
records of marginal relevance to a case or for the purpose of
embarrassing or intimidating opposing parties.'' Is this an area that
you believe will need to be changed?
First, the APA unfortunately quoted a condition on the permissible
disclosure of protected health information in a judicial or
administrative proceeding that was contained in the Notice of Proposed
Rulemaking issued in November, 1999. That provision was changed in the
final Privacy Rule, issued in December, 2000. The final Privacy Rule
permits the disclosure of protected health information in a judicial or
administrative proceeding if there is a court order for such
information or if there is otherwise adequate assurances provided that
the individual whose medical information is being sought has been
notified of the request in order to raise objections to the release of
the information or that the information will remain confidential
pursuant to a protective order.
Second, despite the change in the final Rule, some commenters
continue to favor a stricter policy of requiring a court order for the
release of any protected health information sought in a judicial or
administrative proceeding. The Privacy Rule in no way impedes a covered
entity from continuing a policy of releasing protected health
information to a court or administrative tribunal only pursuant to a
court order or the individual's consent. Given that the standard for
disclosures for judicial or administrative proceedings is permissive in
nature, and does not preclude practices that are more protective of
privacy at the discretion of the covered entity, the Department is not
contemplating any change to this standard at the present time.
Question 54. On page 17 of your written testimony, you state that
the Administration is seeking an additional $26 million for research on
health quality, and that a portion of those resources will be used to
implement the Institute of Medicine's recommendations to eliminate
medical errors. According to the 1999 Institute of Medicine report, To
Err Is Human: Building a Safer Health System, in hospitals alone,
almost 100,000 Americans die each year due to medical errors. If
nursing homes, ambulatory care centers, home health services, and
doctors' offices were included, estimates of the number of unnecessary
deaths would be much higher. As the IOM stated in its report, ``more
people die in a given year as a result of medical errors than from
motor vehicle accidents (43,458), breast cancer (42,297), or AIDS
(16,516).'' After months of investigation and research, the IOM
reported:
The decentralized and fragmented nature of the health care delivery
system (some would say ``nonsystem also contributes to unsafe
conditions for patients, and serves as an impediment to efforts to
improve safety. Even within hospitals and large medical groups, there
are rigidly-defined areas of specialization and influence. For example,
when patients see multiple providers in different settings, none of
whom have access to complete information, it is easier for something to
go wrongY(Institute of Medicine, To Err Is Human: Building a Safer
Health System, 2-3). If insufficient information leads to lower quality
patient care, don't you believe that the ``minimum necessary'' standard
needs to be rewritten so as to permit the development of common-sense
practices in the health care setting to reduce medical errors?
Response: The Agency for Healthcare Research and Quality (ARHQ) is
pursing a vigorous research program to identify and validate patient
safety practices that can reduce the risk of injury to patients. ARHQ
has just released a report that reviews the available scientific
evidence on patient safety practices and rated 73 practices that are
likely to improve patient safety and describes 11 for which there is
strong evidence of effectiveness. During this current fiscal year, AHRQ
plans to award over 60 research and demonstration patient safety
grants. As our knowledge grows regarding which patient safety practices
are scientifically demonstrated to be effective, the Department will
continuously assess the standards governing our health care service
delivery and payment programs to ensure that they facilitate, not
frustrate, the safety and quality of patient care.
Question 55. As you know, it was under tremendous pressure from
consumers, patient groups, and others that Congress passed FDAMA to
speed up the approval process for new drugs, biologics and devices.
This rule may in fact slow down that process, because although the rule
sets out explicit standards for collecting information for future
clinical trials, under the proposed rule it may be impossible or
illegal to get information from subjects of previous clinical trials.
How will you account for the best interests of patients and consumers
as you fashion guidance for this regulation?
Response: We do not anticipate that this rule will affect access to
information from prior clinical trials or affect in any way the
timeliness of drug approvals by the FDA.
Question 56. Under the regulation, all covered entities will have
to recontract with their business associates to require that the
associates comply with the entities' privacy policies. We hear from
hospitals and health plans that they may have upwards of 700 business
associates each, some of whom may also be covered entities. Even if
they started today, they would have to sign a new contract on nearly
every day in order to be in compliance in two years. Considering this
was an administrative simplification requirement to start with, how
does the Department plan to address this formidable paperwork
requirement in crafting guidance for the final rule?
Response: The claim of hundreds of business associates for a given
covered entity highlights the need for the business associate
standards. Without any standards, an individual's private medical
information could be handed over to vast numbers of commercial
enterprises, most of which would have little or no obligation to
protect the confidentiality of the information. The Privacy Rule does
not interfere with these necessary business relationships, but it does
require covered entities to obtain a written assurance from these
business associates that they will appropriately safeguard the
individual's protected health information. On July 6, 2001, the Office
for Civil Rights (OCR) issued the first in a series of ongoing guidance
and technical assistance materials to assist covered entities and
others in better understanding what the Privacy Rule does or does not
do. The business associate standards were one of the many topics
addressed by the guidance. In the July guidance materials, we responded
to three frequently asked questions concerning the limits of the
Secretary's authority under the HIPAA statute with respect to business
associates, the extent of their contractual obligations to the covered
entity, and whether covered entities are liable for the privacy
violations of their business associates.
Question 57. What if two covered entities are contracting with each
other and their privacy policies vary slightly: What if a hospital has
ten business associates who are covered entities with varying privacy
policies? Does the Department have any guidance on this situation?
Response: As we make clear in the July guidance, the Privacy Rule's
requirements are not A passed through to the business associate. There
is no requirement that the ten business associates of the hospital
follow the hospital's privacy practices. The business associate is
required to provide assurances that protected health information will
be appropriately safeguarded and used or disclosed to others only for
purposes that are necessary to carry out its business associate
functions. For example, if a hospital contracts out its billing
function, the business associate must safeguard the protected health
information received from the hospital and use or disclose that
information only for the billing services that it provides and other
activities needed to operate its business. A covered entity may be the
business associate of another covered entity, in which case, its own
privacy policies under the Rule would suffice as the appropriate
safeguards required by the business associate provisions. The Privacy
Rule does not required the covered entity that is acting as a business
associate to conform to B or even know the details of B the other
covered entities privacy policies.
Question 58. What is the Administration's timeline for putting the
Security and Electronic Signatures standard in place?
Question 59. We understand that a need to clarify the most basic
issue--the very definition of what is ``individually identifiable
health information,'' which is protected and governed by the rule, has
been brought to your staff. The claim has been made that HIPAA allows
states to regulate ``individually identifiable health information: in a
more stringent manner than the rule that has taken effect, but does not
allow States to change the definition of what the rule covers. Further,
If States can change what is and isn't governed by the rule the use of
de-identified health data will be at risk. Can you tell our Committee
if your staff has decided on the need to issue guidance or to make a
modification to the rule on the basic definition of what the rule
covers and what it does not?
Response: The preemption provisions of the statute, sections 1178
of the Social Security Act and 264(c)(2) of HIPAA, concern the issue of
conflict between provisions of State law and the federal rule that
imposes ``requirements, standards, or implementation specifications.''
In general, we do not think that the definition of ``individually
identifiable health information'' comes within this statutory
preemption framework. We also note that the term ``individually
identifiable health information'' is defined at section 1171(6) of the
Social Security Act. In light of these considerations, we do not see a
need to issue guidance or a modification of the rule concerning the
definition of ``individually identifiable health information.''
Question 60. In the past, Members of the Committee have raised
concerns about having a Federal floor instead of a Federal ceiling on
privacy laws. A claim has been made that HIPAA allows States to
regulate ``individually identifiable health information'' in a more
stringent manner than the rule, but dos not allow States to change the
definition of what the rule covers. Further, I've been told that if
States can change what is and isn't governed by the rule, the use of
de-identified health data will be at risk. Are you going to issue
guidance on what States can or cannot do to regulate `` individually
identifiable health information?''
Response: As noted above, the preemption provisions are statutory.
Therefore, the Department cannot address through guidance the
Committee's concerns about the federal privacy provisions operating as
a federal floor rather than a federal ceiling.
Question 61. Even before the April 14 effective date of the rule,
we had an illustration of what may happen when State privacy laws are
alleged to apply to the uses and disclosures of individually
identifiable health information. The dispute between Quintiles
Transnational and WebMD illustrates at least two of the problems likely
to result from State preemption of federal privacy standards: first,
that States may lack the expertise to address certain aspects of health
information privacy, such as trying to define statistical methods for
the de-identification of health information that ate ``more stringent''
than the federal standard and still allow the use of data for health
research and vital public health purposes; and, second, that such State
actions will be employed not to protect individual privacy but as part
of a contractual dispute between covered entities and their business
partners. Are you aware of the dispute between Quintiles Transnational
and WebMD regarding the creation and transmission of de-identified
health data, and a United States Federal District Court ruling that
addresses the potential impact of the U.S. Constitution's Commerce
Clause regarding any State's ability to interfere with commercial
transactions that occur in other states?
Response: We are aware of the dispute in Quintiles Transnational
Corp. v. WebMD Corp., Civ. No. 5:01-CV-180-BO(3), E.D.N.C. We note
that, in a ruling entered on March 21, 2001, the District Court granted
Quintiles Transnational's request for a preliminary injunction
requiring WebMD to continue to abide by the terms of the Data Rights
Agreement between the parties. The court held that the Dormant Commerce
Clause prevents the individual States from regulating the interstate
transmission of data, and that WebMD, therefore, erred in relying on
the privacy laws of some States to excuse its failure to perform its
obligation to transmit data to plaintiff under the Data Rights
Agreement.
Question 62. When can we expect to have all the regulations on
administrative simplification finalized--security, enforcement, and
national identifiers (provider, employer, and health plan)? In
addition, when can we expect the national identifiers to be available
for distribution?
Response: I have an ongoing, concentrated effort to implement the
Administrative Simplification section of the Health Insurance
Portability and Accountability Act of 1996. Of the nine rules that
comprise Administrative Simplification, five Notices of Proposed
Rulemaking have been issued. Two of these, the Privacy and Transaction
and Code Sets, have been issued in final, with corresponding compliance
dates. CMS hopes to have the final Security and Employer Identifier
rule published by this fall.
The Notices of Proposed Rulemaking have generated a large number of
comments by the covered entities, including 17,000 comments on the
Transaction and Code Sets, and in excess of 50,000 comments on the
Privacy Notice of Proposed Rulemaking. Significant progress has been
made on issuing notices of proposed rulemaking, categorizing,
reviewing, and responding to the comments received, and issuing final
rules. CMS is working as quickly as it can to complete work on the
remaining rules.
Regarding the regulation and implementation of provider and health
plan identifiers, the Department is reviewing how best to achieve this
goal, as well as evaluating the budget implications.
Question 63. The industry anticipates significant modifications to
the final rule on Electronic Transactions Standards as permitted under
HIPAA. Do these changes need to go through an NPRM and Final Rule
process? When do you think these changes will be in their final form?
Response: Yes, changes to the implementation guidelines recommended
by the Designated Standards Maintenance Organizations must go through
the Department's regulation process. The Department will be publishing
a notice of proposed rulemaking, proposing the Designated Standards
Maintenance Organizations' changes. Also, the specific proposed changes
will be available shortly from the American National Standards
Institute Accredited Standard Committee X12, Health Care Task Group--
the nationally recognized electronic data interchange standards
development organization for all forms of electronic commerce.
Question 64. What actions has the Department taken to educate
physicians, hospitals and other providers on these regulations?
Response: There are substantial, on-going efforts to inform and
educate all covered entities regarding the Administrative
Simplification regulations. These include:
Publication of all Notices of Proposed Rulemaking and Final
Rules in the Federal Register, including any technical
corrections
A comprehensive, up-to-date website with all information
relating to Administrative Simplification--available on the Web
at: http://aspe.hhs.gov/admnsimp
Active participation in meetings of standard setting
organizations such as the Workgroup on Electronic Data
Interchange, as well as congressionally mandated advisors such
as the National Committee on Vital and Health Statistics;
The issuance of Guidance Documents to help health care
providers and health plans come into compliance with the
regulations. The guidance is available on the Web at: http://
www.hhs.gov/ocr/hipaa.
CMS is reaching out to educate physicians and other providers in a
variety of ways. For Medicare, they are focusing on reaching providers,
both directly and through the Medicare contractors. They expect that
CMS Medicare contractors will be ready to begin testing HIPAA
transactions for claims and remittance information this Fall.
Disseminating articles through contractor bulletins and
websites. The first article went out last Fall, and dealt
primarily with transactions. CMS is planning additional
articles regarding privacy, the National Provider Identifier,
testing, security, and claims attachments.
Offering web-based training for providers, including an
overview of HIPAA. CMS also is developing self-assessment
guidance. A draft of the full course on self-assessment will be
completed in August, and the course should be available by the
end of 2001.
Offering several Web resources, a summary of which will be
published on the Medlearn page by the end of July. Pointers
will be provided to materials at Washington Publishing Company,
Workgroup on Electronic Data Interchange, and other websites.
Broadcasting information, via satellite, that is now available
from our web-based training and presentation materials. The
first broadcast is scheduled for later this year and should
reach several thousand providers at 600 satellite sites. We
will rebroadcast the information 3 or 4 more times.
Developing a HIPAA brochure to be distributed at provider
conferences.
My focus is on the State Medicaid programs and their critical intra
and inter-state trading partners, such as for Medicaid, the State
Departments of Human Services that provide health, screening,
diagnostic and nutritional services to low income children, mothers,
the elderly and disabled.
While I expect each State to conduct their own HIPAA outreach
efforts with physicians, hospitals, laboratories, pharmacies, nursing
homes, and beneficiaries, CMS's role is to support State efforts and be
a national resource on Medicaid HIPAA. To that end, CMS is working with
staff at all levels of State government, including Department heads,
Commissioners of human service agencies, State CIO's, legislative staff
and the Governor's offices, who can provide executive support and
resources to State HIPAA implementation efforts. CMS also has developed
and distributed a 10-page bi-monthly newsletter, HIPAA Plus, covering
news from national and regional sources. In April, CMS held the first
annual National Medicaid HIPAA conference. Over 500 people from all 50
States and Guam attended the 3-day conference. They plan to hold the
second annual conference in April 2002. In addition, CMS has developed
an interactive tool States can use to conduct a HIPAA ``gap analysis,''
called the Medicaid HIPAA Compliant Concept Model. This tool helps to
highlight areas where States need to take action to ensure compliance.
CMS has identified a representative in each State to assist with
implementation of the model, and will hold monthly conference calls
with States to share information. CMS will hold a working lunch at the
MMIS conference in New Hampshire to review the new Version 2 of the
model. The model is available on CD and on the web at Washington
Publishing Company. Also, two brochures on the Medicaid HIPAA Compliant
Concept Model have been distributed to the States, and a new brochure
is in development now. Ultimately, one brochure will include a detailed
view of HIPAA, a second will explain the Medicaid HIPAA Compliant
Concept Model, and a third will be tailored for audiences requiring
basic information on HIPAA.
In the Medicare+Choice area, CMS's focus is on the plans
themselves. CMS expects that they will conduct their own outreach to
their providers and trading partners. In addition, CMS is planning a
managed care HIPAA conference for September, at CMS headquarters in
Baltimore, and CMS is developing a HIPAA self-assessment tool
specifically for managed care plans.
Question 65. With the recent announcement that HHS would implement
the HIPAA as scheduled and as written, the President and HHS have taken
a bold step towards protecting an individual's medical information.
However, it is becoming increasing apparent that there are some flaws
with the regulations. As an example, the regulations do not acknowledge
that there are benefits to the public to know, through the press, about
some basic health information. For instance, as presently written, some
have argued that the public would not have been able to learn the
status of the students shot at Columbine High School, the misconduct of
health providers at a local hospital, or the medical condition of
people involved in widespread or highly dangerous epidemics or
diseases--unless, of course, each of the individuals consented to
having this information released. Does HHS plan to address the lack of
access to basic information that the public, including journalists, has
the right to know or should know?
Response: The Department is aware of the concern of journalists and
other members of the press that the Privacy Rule does not place the
public's right to know above the individual's right to decide whether
to disclose his or her private medical information. A proper weighing
of the public v. private benefits is made particularly difficult in
this case due to the widely disparate views on what is A newsworthy and
what is merely commercially profitable. The balance struck in the
Privacy Rule was that, provided the individual did not object, the
public B including the press B would have access to basic information
about an individual who has been admitted to a health care facility.
Basic information would include the person's name, location in the
facility and general condition. The only condition on access is that
the person making the inquiry knows the name of the individual whose
basic information is being sought. In addition, as the question
acknowledges, the individual can authorize the release of the
information. Finally, there is no problem with covered entities
releasing information that does not identify the individuals involved.
For example, a hospital could release numbers of persons admitted
following an accident and how many were in serious condition. We will
evaluate the comments made by journalists, as well as others, to
determine if these requirements unduly burden freedom of the press.
Question 66. It is alleged by some that the recently implemented
HIPAA regulations provide whistleblowers with no protection if they
choose to go ``outside the system.'' If for instance, a paramedic
becomes aware that the ambulance service he or she works for will not
service certain areas, that paramedic is prohibited from objecting to
that policy to anyone but an attorney, a health care agency, a public
health authority or a health care accreditation organization, and then,
only under certain limited conditions As has been often documented, the
working relationship between regulators and the regulated often results
in situations where few complaints are found meritorious and regulators
sometimes fail to perform their jobs. Does HHS plan to permit a
whistleblower to go outside the system without being subject to
criminal liability?
Response: The Privacy Rule provides when it would be permissible
for a whistleblower to use or disclose protected health information in
the course of exposing unlawful conduct, violations of professional or
clinical standards, or other conduct that may endanger others. In many
instances the complaint can be made without revealing the private
medical information of any individual. The example used in the question
demonstrates this. The Privacy Rule would not prevent a paramedic from
publicly objecting to ambulance service disparities, including
identifying areas of town which are underserved. It is not necessary to
disclose individually identifiable health information to raise such
objections.
Question 67. Given recent reports of increased drug prices, does
the Administration believe that $150 billion over 10 years is adequate
to provide a prescription drug benefit? How does the President purpose
implementing his state-run plan given the extensive opposition by the
states?
Response: The Administration is now proposing to spend $190 billion
over the eight year period [FY2004-2011] on the Medicare drug benefit.
We want to working closely with Congress in establishing the final
specifications and administrative details of this program.
Question 68. The NIH testified last September that it invested $217
million in basic bio-imaging research in FY 1997 and indicated that
spending in this field had increased since then. It is the Committee's
understanding, however, threat NIH plans to transfer a much smaller
amount of basic imaging and bioengineering grants to NIBIB. What is the
funding level, which NIH has dedicated to NIBIB? How does this relate
to the NIH resources dedicated to bio-imaging and bioengineering
research in the past?
Response: We are excited about the new opportunities that the new
National Institute of Biomedical Imaging and Bioengineering (NIBIB)
will create for support of fundamental research that applies principles
of engineering, mathematics, computer science and the physical sciences
to biological processes, disorders and diseases.
The President's budget request for NIBIB for Fiscal Year 2002 is
$40 million. These funds will be supplemented through a transfer of
appropriate grants to NIBIB from other NIH Institutes and Centers
(ICs). The process for identifying the appropriate grants for transfer
is underway. After we review the entire slate of grant transfer
candidates, NIH will submit the transfer information to the House and
Senate Appropriations Committees for final approval and incorporation
into the FY 2002 budget for NIBIB. We believe that this initial budget
will form an adequate base upon which to build future year funding
requests for the NIBIB and will permit careful stewardship and
oversight of research programs in the first year of this newest of the
NIH ICs. As rich opportunities emerge, we will adjust our future budget
requests accordingly Institutes. As rich opportunities emerge, we will
adjust our future budget requests accordingly. The transfer of grants
to NIBIB is intended to strengthen and complement, not subtract from or
substitute for, research programs in the other NIH ICs. NIBIB will
support undifferentiated research not related on a one-to-one basis to
the mission of another IC and act as a unique focal point for
multidisciplinary research planning and strategic development. The
other NIH ICs will continue those studies that are a natural fit within
their current organizations those focused on specific diseases or
conditions. The ICs and key constituencies in the imaging and
engineering communities have endorsed this strategy for building the
new Institute and continuing to support these studies across NIH.
Question 69. The President has stated publicly his opposition to
medical research on human embryonic stem cells. In fact, Mr. Secretary,
you recently canceled a meeting of the NIH Committee responsible for
reviewing applications from scientists seeking federal funds for this
type of research. Please provide for the Committee the findings upon
which President Bush has based his position that human embryonic stem
cell research should be limited. Please also include a detailed
description of the Bush Administration's position on stem cell/fetal
tissue research, including when it is or is not appropriate.
Response: The President is consulting with advisors and appropriate
agencies who have been formulating policy recommendations in this area
which is receiving close and careful attention.
Question 70. Can you assure us that Congress' intent to provide
adequate Medicaid payments to health centers will be protected by not
applying the Upper Payment Limit to Medicaid payments made to
individual Federally qualified health centers or, likewise, to all
health centers in a State?
Response: CMS has not previously had to examine the interplay
between its regulations on maximum payments to clinics and its payment
rules for Federally Qualified Health Centers. In order to respond to
your question, I have taken a look at the issue, but my answer here is
preliminary at best.
It appears that because Federally qualified health centers fall
into the clinic provider category, they are covered by the provisions
of the Upper Payment Limit regulatory changes implemented in March of
this year. However, since Federally Qualified Health Centers also have
specific payment rules that were based on reasonable costs and are now
governed by the new Prospective Payment System, I also believe that the
Upper Payment Limit provisions would not come into play. So even though
Federally Qualified Health Centers may be covered by the Upper Payment
Limit regulations, those regulations should not result in any adverse
impact on Federally Qualified Health Center payments.
Question 71. Some have expressed a concern that Congress is giving
NIH too much money without any guidance on where that money should be
spent. While we have teaching hospitals and researchers all around the
country that would benefit from extramural NIH grants, a significant
amount of the money is spent on campus at NIH, and it seems likely that
a large portion will be spent on bricks and mortar construction. Would
you support that use of research money?
Response: The NIH budget supports the individual research projects
conceived of and conducted by either government scientists working in
the NIH facilities or scientists working at universities or other
institutions across the country and around the world. NIH support of
these research projects includes, in whole or in part, the salaries of
scientists and technicians, and the cost of equipment, supplies and
procedures employed in the research. Biomedical research funding also
encompasses the costs associated with providing and maintaining the
physical infrastructure that is an essential component of the research
enterprise.
The Buildings & Facilities (B&F) appropriation supports the
essential physical infrastructure required to carry out the intramural
part of NIH's biomedical research mission. Rapid advances in the
understanding of basic biology and the complexity of human disease are
providing unique research opportunities for new treatments and cures.
As the approaches to basic and clinical research evolve, the demands
for, and on, research facilities change as well. Properly planned and
equipped, safe, and flexible research facilities are important
resources in the formula for achieving the next scientific advance or
biomedical breakthrough. These facilities underpin the pace at which
research can advance by accommodating new research tools and
instruments, providing infrastructure, such as information
technologies, and supporting animal models to investigate new
therapies.
More than 80% of the NIH budget goes to extramural programs, about
10% is for intramural research, and only about 1% is for the NIH
facilities infrastructure. The Congress reviews the programs in the NIH
B&F budget request as line items, and the amount appropriated is
balanced in terms of the intramural research needs and those of the
entire NIH supported research enterprise. The B&F budget is the product
of a deliberate, corporate, facilities planning process that addresses
the immediate and longer-range facility requirements to meet the
research needs of the entire agency. It strikes a balance among three
critical facility priorities: the creation of new facilities for new
and expanding scientific opportunities, the upgrading of existing
facilities to keep pace with the changing requirements of ongoing NIH
programs and the responsible stewardship of the entire NIH real estate
portfolio. The proposals for new construction, renovations and
maintenance are key elements to ensuring the vitality of the NIH
biomedical research enterprise.
Question 72. Regarding the cuts in rural health for telemedicine
and outreach programs. Why is the President proposing to cut one of the
most innovative and cost effective mechanisms that ensures access to
specialty services for rural patients? The health care community has
slowly been moving in the telemedicine direction for many years, slowly
due to the high cost of technology.
Response: The reductions in both the telemedicine and outreach
programs are not cuts. The reductions are due to the removal of earmark
funding from both authorities. The Outreach Line in FY 2001 had $19.5
million in congressionally earmarked projects. The base amount for the
program, the amount that was given out in competitive grants, was
$31.067 million. For FY 2002, the Administration is proposing flat
funding for this program with a total of $31.067 million.
Question 73. Regarding the cuts for health professions training
programs from $353 million in '01 to $140 million in '02, a cut of $213
million. This funding supports training for a number of health care
professionals including allied workers. We are facing a shortage of
health professionals in the health care community. How can the
President propose to help the uninsured through tax credits, thereby
increasing utilization of health care services and at the same time cut
programs that support training of health care professionals? Who is
going to take care of the newly insured individuals when they try to
access the health care system?
Response: The Department is very concerned with health
professionals workforce issues. HRSA's health professionals programs
have worked to expand the health professionals workforce as well has
recruit providers to underserved areas of the country. With regard to
physicians, there is no longer an overall shortage. Between 1970 and
1988, the supply of physicians grew 127% and current data indicate that
the physician to population ration remains steady. The Department is
working to address emerging shortages in the disciplines of nursing and
dentistry. The President's fiscal year 2002 budget requests an increase
of $5 million for Nursing Workforce Development and an increase of $1.4
million within the Public Health Workforce Development cluster for
dental public health programs. Additionally, Secretary Thompson is
using his transfer authority to increasing funding to HRSA's Nursing
Loan Repayment Program by $5 million this fiscal year. Finally, the
Department is considering management reforms to the National Health
Service Corps to improve the programs ability to recruit and retain
qualified primary care providers to underserved areas.
Question 74. I represent a rural state, Wyoming, so I am naturally
concerned about ensuring adequate health services in rural areas. How
does the President's budget specifically address the needs of rural
communities?
Response: The Administration continues to support rural health. For
FY 2002, the Administration proposes level funding for all of the key
rural health programs: Outreach, Telehealth, State Offices of Rural
Health, the Rural Hospital Flexibility Grant Program and the Rural
Health Research Center program. These programs help build rural health
infrastructure development through grant awards under the Outreach
Program and the Rural Hospital Flexibility Grant Program. The State
Offices of Rural Health Program provides matching grants to states to
maintain a rural focal point within each of the 50 states. In addition,
the Rural Health Research Center grant program provides grants to six
rural health research centers to conduct policy relevant and rural
specific health services research. The Administration also provides
level funding to the policy activities of the Federal Office of Rural
Health Policy to continue its work within the Department on behalf of
rural communities.
Question 75. The National Health Service Corps is a very beneficial
program in helping to recruit and retain health care providers in my
state. The President has expressed his support for this program, and
has provided an increase in funding for it in the budget. I also
understand that the President is calling for various reforms within the
program. Could you please explain what specific reforms the President
is proposing?
Response: We are examining the ratio of scholarships to loan
repayments awarded as well as other set-asides to ensure maximum
flexibility to better meet community requests for NHSC providers. To
more accurately define shortage areas and target placements better, the
Administration will seek to amend the shortage area definition to
reflect other non-physician providers practicing in communities. We are
also planning to enhance coordination with immigration programs such as
the J-1 visa program.
Question 76. The President's budget calls for reductions in funding
for Health Professions and the elimination of the Community Access
Program, both of which service rural areas. Can you please explain the
rationale behind this?
Response: The Bureau of Health Professions' program that primarily
supports rural areas is the Quentin N. Burdick Program for Rural
Interdisciplinary Training. While successful, this program supports
relatively small training efforts that have secured support from other
funding sources, including other Federal programs such as the
Administration on Children and Families and private foundations, such
as the Robert Wood Johnson Foundation. States participating in this
program have found it to be a significant healthcare workforce pipeline
for rural underserved areas. Since rural health workforce shortages are
evident in all 50 states, we believe that we must work to attract
health care students to the rural areas with rural clinical training
experiences that are supported by training programs like the Quentin N.
Burdick Program for Rural Interdisciplinary Training. To accomplish
this goal the Bureau of Health Professions promotes the inclusion of a
rural component in all of its grant programs.
Question 77. I have concerns about Medicare reimbursement rates as
they apply to rural vs. urban areas. There currently seems to be a
great deal of disparity, and it is having a negative impact on the
providers in my district.
Take for example the town of Jackson Hole, in my home state of
Wyoming. It is an affluent area with a cost-of-living comparable to the
New York area. Medicare's allowable charge for a routine EKG in WY is
about $25, in NY $59. A physician would be reimbursed $20 in WY for
that EKG whereas in NY reimbursement would be $47. I have trouble
understanding that disparity, especially when it is the very same test
being administered in both places. This is causing many providers in
rural areas to pull out of Medicare.
Knowing that Medicare reform is a priority for this Administration,
I would like to know if you see the Medicare reimbursement formula as
problematic? If yes, does the Administration plan to address this, and
how?
Response: I recognize rural providers frustration with this system,
and Congress, CMS, and I have worked to ensure all providers are paid
appropriately. Rural states have long argued that, due to the way the
wage index is calculated, payment amounts are weighted toward urban
areas. There is a strong argument to be made, and obviously this is a
difficult issue to address. I also share your concerns about providers
in rural areas pulling out of Medicare, and I want to work with you to
ensure that all Medicare beneficiaries have access to affordable,
quality health care, regardless of where they live.
As required by law, physician services paid under the physician fee
schedule are divided into three components: 1) physician work, 2)
practice expense (such as employee wages, rents, and medical equipment
and supplies), and 3) malpractice insurance. On average, physician work
represents 54.5 percent of the total relative value, practice expenses
represent 42.3 percent, and malpractice represents 3.2 percent.
Payments for a particular service vary among 89 geographic fee schedule
payment areas only to the extent that the resource cost of providing
such services varies. This variation is measured by geographic practice
cost indices which, by law, compares the local costs in each of the 89
areas to the national average for each of the three components.