[House Hearing, 113 Congress]
[From the U.S. Government Publishing Office]
PPACA IMPLEMENTATION FAILURES: ANSWERS FROM HHS
=======================================================================
HEARING
BEFORE THE
COMMITTEE ON ENERGY AND COMMERCE
HOUSE OF REPRESENTATIVES
ONE HUNDRED THIRTEENTH CONGRESS
FIRST SESSION
__________
OCTOBER 30, 2013
__________
Serial No. 113-90
Printed for the use of the Committee on Energy and Commerce
energycommerce.house.gov
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COMMITTEE ON ENERGY AND COMMERCE
FRED UPTON, Michigan
Chairman
RALPH M. HALL, Texas HENRY A. WAXMAN, California
JOE BARTON, Texas Ranking Member
Chairman Emeritus JOHN D. DINGELL, Michigan
ED WHITFIELD, Kentucky Chairman Emeritus
JOHN SHIMKUS, Illinois FRANK PALLONE, Jr., New Jersey
JOSEPH R. PITTS, Pennsylvania BOBBY L. RUSH, Illinois
GREG WALDEN, Oregon ANNA G. ESHOO, California
LEE TERRY, Nebraska ELIOT L. ENGEL, New York
MIKE ROGERS, Michigan GENE GREEN, Texas
TIM MURPHY, Pennsylvania DIANA DeGETTE, Colorado
MICHAEL C. BURGESS, Texas LOIS CAPPS, California
MARSHA BLACKBURN, Tennessee MICHAEL F. DOYLE, Pennsylvania
Vice Chairman JANICE D. SCHAKOWSKY, Illinois
PHIL GINGREY, Georgia JIM MATHESON, Utah
STEVE SCALISE, Louisiana G.K. BUTTERFIELD, North Carolina
ROBERT E. LATTA, Ohio JOHN BARROW, Georgia
CATHY McMORRIS RODGERS, Washington DORIS O. MATSUI, California
GREGG HARPER, Mississippi DONNA M. CHRISTENSEN, Virgin
LEONARD LANCE, New Jersey Islands
BILL CASSIDY, Louisiana KATHY CASTOR, Florida
BRETT GUTHRIE, Kentucky JOHN P. SARBANES, Maryland
PETE OLSON, Texas JERRY McNERNEY, California
DAVID B. McKINLEY, West Virginia BRUCE L. BRALEY, Iowa
CORY GARDNER, Colorado PETER WELCH, Vermont
MIKE POMPEO, Kansas BEN RAY LUJAN, New Mexico
ADAM KINZINGER, Illinois PAUL TONKO, New York
H. MORGAN GRIFFITH, Virginia JOHN A. YARMUTH, Kentucky
GUS M. BILIRAKIS, Florida
BILL JOHNSON, Missouri
BILLY LONG, Missouri
RENEE L. ELLMERS, North Carolina
C O N T E N T S
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Page
Hon. Fred Upton, a Representative in Congress from the State of
Michigan, opening statement.................................... 2
Prepared statement........................................... 3
Hon. Michael C. Burgess, a Representative in Congress from the
State of Texas, prepared statement............................. 49
Hon. Marsha Blackburn, a Representative in Congress from the
State of Tennessee, prepared statement......................... 88
Hon. Greg Walden, a Representative in Congress from the State of
Oregon, prepared statement..................................... 88
Witnesses
Kathleen Sebelius, Secretary, U.S. Department of Health and Human
Services....................................................... 5
Prepared statement........................................... 8
Answers to submitted questions............................... 147
Submitted material
Report entitled, ``Exposing the Anti-Obamacare Sabotage
Campaign,'' dated September 2013, by the Center for American
Progress Action Fund, submitted by Mr. Pallone................. 90
Documents submitted by Mr. Lujan................................. 115
Document binder.................................................. 120
PPACA IMPLEMENTATION FAILURES: ANSWERS FROM HHS
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WEDNESDAY, OCTOBER 30, 2013
House of Representatives,
Committee on Energy and Commerce,
Washington, DC.
The committee met, pursuant to call, at 9:02 a.m., in room
2123, Rayburn House Office Building, Hon. Fred Upton (chairman
of the committee) presiding.
Present: Representatives Upton, Hall, Barton, Whitfield,
Shimkus, Pitts, Walden, Terry, Rogers, Murphy, Burgess,
Blackburn, Gingrey, Scalise, Latta, McMorris Rodgers, Harper,
Lance, Cassidy, Guthrie, Olson, McKinley, Gardner, Pompeo,
Kinzinger, Griffith, Bilirakis, Johnson, Long, Ellmers, Waxman,
Dingell, Pallone, Eshoo, Engel, Green, DeGette, Capps, Doyle,
Schakowsky, Matheson, Butterfield, Barrow, Matsui, Christensen,
Castor, Sarbanes, McNerney, Braley, Welch, Lujan, Tonko, and
Yarmuth.
Staff Present: Clay Alspach, Chief Counsel, Health; Carl
Anderson, Counsel, Oversight; Gary Andres, Staff Director; Ray
Baum, Senior Policy Advisor/Director of Coalitions; Mike
Bloomquist, General Counsel; Sean Bonyun, Communications
Director; Matt Bravo, Professional Staff Member; Megan Capiak,
Staff Assistant; Karen Christian, Chief Counsel, Oversight;
Noelle Clemente, Press Secretary; Paul Edattel, Professional
Staff Member, Health; Brad Grantz, Policy Coordinator, O&I;
Sydne Harwick, Legislative Clerk; Brittany Havens, Legislative
Clerk; Sean Hayes, Counsel, O&I; Kirby Howard, Legislative
Clerk; Alexa Marrero, Deputy Staff Director; Nick Magallanes,
Policy Coordinator, CMT; Carly McWilliams, Professional Staff
Member, Health; Brandon Mooney, Professional Staff Member; Gib
Mullan, Chief Counsel, CMT; Katie Novaria, Professional Staff
Member, Health; Monica Popp, Professional Staff Member, Health;
Andrew Powaleny, Deputy Press Secretary; Chris Sarley, Policy
Coordinator, Environment & Economy; Heidi Stirrup, Health
Policy Coordinator; John Stone, Counsel, Oversight; Tim Torres,
Deputy IT Director; Tom Wilbur, Digital Media Advisor; Jessica
Wilkerson, Staff Assistant; Ziky Ababiya, Minority Staff
Assistant; Phil Barnett, Minority Staff Director; Stacia
Cardille, Minority Deputy Chief Counsel; Brian Cohen, Minority
Staff Director, Oversight & Investigations/Senior Policy
Advisor; Hannah Green, Minority Staff Assistant; Elizabeth
Letter, Minority Assistant Press Secretary; Karen Lightfoot,
Minority Communications Director and Senior Policy Advisor;
Karen Nelson, Minority Deputy Committee Staff Director for
Health; Stephen Salsbury, Minority Special Assistant; Roger
Sherman, Minority Chief Counsel; and Matt Siegler, Minority
Counsel.
Mr. Upton. Good morning, everyone. Good morning.
Secretary Sebelius. Good morning.
OPENING STATEMENT OF HON. FRED UPTON, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF MICHIGAN
Mr. Upton. Energy and Commerce Committee welcomes the
President's point person on health care, Secretary Sebelius, as
part of our continuing oversight of the healthcare law, and we
look forward to a thoughtful conversation on a number of
issues, including transparency and fairness.
Over the months leading up to October 1 launch, the
Secretary and her colleagues at HHS repeatedly looked us in the
eye and testified that everything was on track, and despite the
numerous red flags and lack of testing, they assured us that
all systems were a go. But something happened along the way.
Either those officials did not know how bad the situation was,
or they did not disclose it. And sadly, here we are now 5 weeks
into enrollment, and the news seems to get worse by the day.
HealthCare.gov was down last night at 5 o'clock p.m. It was
also down on Monday, and it crashed last weekend. And even this
morning when we attempted to view the site before the hearing,
we were hit with an error message.
But this is more than just a Web site problem. That was
supposed to be the easy part, remember? Americans were assured
that their experience would be similar to other online
transactions, like purchasing a flight or ordering a pizza, and
that their sensitive personal information would always be
secure. But after more than 3 years to prepare, malfunctions
have become the norm, and the administration has pivoted from
saying they're on track to setting a new target date of
November 30th. And for those few Americans who have
successfully applied, will the Web site glitches become
provider glitches come January 1st?
Americans are scared and frustrated, and this situation
should rise above politics. Many folks at home watching us
today have spent hours or even days trying to sign up. They
continue to take time away from work or loved ones, but have
made little progress, and soon they may worry about being on
the wrong side of their government, facing potential penalties.
I recently spoke to a woman from Buchanan, Michigan, who
was excited to sign up, but has since become very disillusioned
after spending hours on the phone and Web site with little
success. There are also millions of Americans coast to coast
who no doubt believed that the President repeated promises that
if they liked their plan, that they would be able to keep it,
no matter what. They are now receiving termination notices, and
for those who lose their coverage, they like--they may be
losing their faith in their government.
Today's hearing is about fairness for the American people
who are losing their coverage or seeing their premiums
skyrocket as high as 400 percent. This hearing is also about
transparency. While the administration continues to boast the
number of Americans that have applied, they intentionally
withhold precise enrollment numbers. Why? These numbers are
critical to fully understand the status engaging the progress
of implementation.
Lead contractor CGI testified only last week that they had
the data, but needed the administration's permission to release
it. We asked the Secretary on October 8th for those figures,
but we still have not received a response. We hope to get one
today. The American people deserve answers as well as the peace
of mind that promises will be kept. The Secretary has an
opportunity today to embrace transparency and start restoring
the public's faith in the administration and the government.
[The prepared statement of Mr. Upton follows:]
Prepared statement of Hon. Fred Upton
The Energy and Commerce Committee welcomes the president's
point person on health care, Secretary Sebelius, as part of our
continuing oversight of the health care law. We look forward to
a thoughtful conversation on a number of issues including
transparency and fairness.
Over the months leading up to the October 1 launch, the
secretary and her colleagues at HHS repeatedly looked us in the
eye and testified that everything was on track. Despite the
numerous red flags and lack of testing, they assured us that
all systems were a go.
But something happened along the way--either those
officials did not know how bad the situation was, or they did
not disclose it. Sadly, here we are, now five weeks into
enrollment, and the news seems to get worse by the day.
Healthcare.gov was down last night at 5:00 p.m. It was also
down on Monday, and it crashed last weekend. And even this
morning when we attempted to view the site before this hearing,
we were hit with an error message.
But this is more than just a Web site problem--that was
supposed to be the easy part. Americans were assured their
experience would be similar to other online transactions like
purchasing a flight or ordering a pizza and that their
sensitive personal information would be kept secure. But after
more than three years to prepare, malfunctions have become the
norm and the administration has pivoted from saying they are
``on track'' to setting a new target date of November 30. And
for those few Americans who have successfully applied, will the
Web site glitches become provider glitches on January 1?
Americans are scared and frustrated, and this situation
should rise above politics. Many folks at home watching us
today have spent hours or even days trying to sign up. They
continue to take time away from work or loved ones but have
made little progress, and soon they may worry about being on
the wrong side of their government, facing potential penalties.
I recently spoke to a woman from Buchanan, Michigan, who was
excited to sign up, but has since become disillusioned after
spending hours on the phone and Web site with little success.
There are also millions of Americans coast to coast who no
doubt believed the president's repeated promise that if they
liked their plan, they'd be able to keep it ``no matter what.''
They are now receiving termination notices, and for those who
lose the coverage they like, they may also be losing faith in
their government.
Today's hearing is about fairness for the American people
who are losing their coverage or seeing their premiums
skyrocket as high as 400 percent. This hearing is also about
transparency. While the administration continues to boast the
number of Americans that have ``applied,'' they intentionally
withhold precise enrollment numbers. Why? These numbers are
critical to fully understanding the status and gauging progress
of implementation. Lead contractor CGI testified last week that
they had the data, but needed the administration's permission
to release it. We asked the Secretary on October 8 for those
figures, but still have not received a response. We hope to get
one today.
The American people deserve answers as well as the peace of
mind that promises will be kept. The secretary has an
opportunity today to embrace transparency and start restoring
the public's faith in the administration and government.
# # #
Mr. Upton. I yield to my colleague, the ranking member of
the committee, Mr. Waxman.
Mr. Waxman. Thank you, Mr. Chairman.
I am pleased Secretary Sebelius is here today. She's here
to discuss the Affordable Care Act. Just like with Medicare
Part D, the launch of the new Web site has not gone well, but
just like Medicare Part D, the early glitches in this rollout
will soon be forgotten.
A lot of the discussion today will focus on that Web site.
This is an important issue, and I want to learn what the
Secretary can tell us about the problems being experienced and
how they will be fixed.
But we should keep this issue in perspective. The
Affordable Care Act is working. It has been improving the
health security of millions of Americans for the past 3 years.
Because of the Affordable Care Act, more than 7 million people
on Medicare have saved more than $8 billion on their
prescription drugs. More than 100 million Americans have access
to free preventive coverage and no longer face lifetime limits
on their coverage. Over 10 million Americans have received
rebates from insurance companies. And, finally, this January,
the worst abuses of insurance industry will be halted. Never
again will a family be denied coverage because their child has
a chronic health condition. Never again will individuals see
their premiums shoot up because they got sick or faced an
unexpected medical expense. Never again will a woman have to
pay twice as much as a man for the same insurance.
That is why allowing insurers to continue offering
deficient plans next year is such a bad policy. The law says
that all plans except those that were grandfathered in 2010
must meet the new consumer protection standards. If we don't
enforce this policy, insurance companies can continue offering
flimsy coverage that disappears when people actually need it.
And no one should want that.
It is understandable that there will be a focus today on
what isn't working, but we must also remember what is working.
The health insurance plans that are being offered in the
exchanges are good plans; their premiums are much lower than
expected. Sixty percent of the uninsured individuals shopping
in the new marketplaces will be able to get coverage for less
than $100 per month. Half of the young adults will be able to
get coverage for less than $50 per month. And since Congress
adopted the Affordable Care Act, healthcare costs across the
whole economy have grown at their lowest level in decades.
The success of the Affordable Care Act is due to the
efforts of many people, but one individual more than any other
is responsible for all the good that has been accomplished, and
that is our witness today Secretary Sebelius.
So I would urge my colleagues to stop hyperventilating. The
problems with HealthCare.gov are unfortunate, and we should
investigate them, but they will be fixed, and then every
American will finally have access to affordable health
insurance.
Thank you, Mr. Chairman.
Mr. Upton. Thank you.
Before we swear in Secretary Sebelius, I want to clarify
Energy and Commerce Committee practice for the swearing in of
witnesses. The committee typically has two types of hearings,
oversight hearings and hearings that focus on legislation and
policy. Secretary Sebelius, for example, has testified
previously before our committee to discuss issues related to
the HHS budget or other policy matters. As is the case with all
policy witnesses, Secretary Sebelius was not required to take
the oath prior to testifying.
Today's hearing is different. It is an oversight hearing.
It is a long-standing committee practice to swear in all
witnesses at oversight hearings, whether they be private
citizens or Cabinet Secretaries.
Mr. Waxman. Mr. Chairman, I thank you for your comments,
and I just want to join you in simply explaining that swearing
in of a witness before an oversight committee hearing has
always been under oath. That is a standard procedure of this
committee when we're conducting an oversight hearing. So it may
seem strange to have the Secretary of Health and Human Services
have to be sworn in, but all witnesses in an oversight hearing
are sworn in, and that is our procedure.
Mr. Upton. Thank you.
So I would now like to introduce our witness for today's
hearing. The Honorable Kathleen Sebelius is the Secretary of
the Department of Health and Human Services. She was appointed
to this position in April of 2009, and was sworn in as the 21st
Secretary on April 28th, 2009.
So I will now swear you in, if you would rise.
As Ranking Waxman and I just discussed, the committee is
holding an investigative hearing, and, when doing so, have had
the practice of taking testimony under oath.
Do you have any objection to testifying under oath?
Secretary Sebelius. No, sir.
[Witness sworn.]
Mr. Upton. You are now under oath and subject to the
penalties set forth in Title 18, section 1001 of the U.S. Code.
You may now give a 5-minute summary of your written
statement. Welcome again, and thank you for being here.
TESTIMONY OF HON. KATHLEEN SEBELIUS, SECRETARY, U.S. DEPARTMENT
OF HEALTH AND HUMAN SERVICES
Secretary Sebelius. Well, thank you, Chairman Upton.
Mr. Upton. You got to use that mic. You don't know how many
people want to hear you this morning.
Secretary Sebelius. Thank you, Chairman Upton, Ranking
Member Waxman, members of the committee.
I left my position as Governor of Kansas 4 \1/2\ years ago
for the opportunity to continue work I've been doing for most
of my over 35 years of public service; to expand the
opportunities for all Americans regardless of geography, or
gender, or income to have affordable health coverage. During my
years as a State legislator, as an elected insurance
commissioner, as head of the National Association of Insurance
Commissioners, and as a two-term Governor, and now as HHS
Secretary, I have worked on that effort that I care deeply
about.
There are still millions of Americans who are uninsured as
well as underinsured, people who have some coverage at some
price for some illness, but have no real protection from
financial ruin and no real confidence they'll be able to take
care of themselves and their families if they have an accident
or an illness. And for them a new day has finally come.
In these early weeks access to HealthCare.gov has been a
miserably frustrating experience for way too many Americans,
including many who have waited years, in some cases their
entire lives, for the security of health insurance. I am as
frustrated and angry as anyone with the flawed launch of
HealthCare.gov, so let me say directly to these Americans, you
deserve better. I apologize. I'm accountable to you for fixing
these problems, and I'm committed to earning your confidence
back by fixing the site.
We're working day and night and will continue until it's
fixed. We've recently added new management talent, additional
technical expertise, and a new general contractor to identify,
prioritize, and manage fixes across the system in two broad
categories: performance, which deals with speed and
reliability; and function, which deals with bugs and problems
in the system.
Our extensive assessment has determined that HealthCare.gov
is fixable, and I want to just outline a couple of the
improvements we've made to date. We now have more users
successfully creating accounts. We can process up to 17,000
account registrations per hour, or nearly 5 per second. Instead
of some of the users seeing a blank screen at the end of the
application process, they can now see whether they're eligible
for financial assistance and make more informed decisions.
Because we've improved performance, customers can now shop for
plans quickly; filtering plans takes seconds, not minutes.
Users are getting fewer errors and timeout messages as they
move through the application process. And the system has been
strengthened with double the size of servers, software that's
better optimized, and a high-capacity physical database which
replaces a virtual system.
The chairman referred to outages this weekend and again
yesterday, and I would suggest to the committee that if you
read the statement of Verizon, who hosts the cloud service, it
is the Verizon server that failed, not HealthCare.gov, and it
affected not only HHS, but other customers.
We still have a lot of work to do. We have a plan in place
to address key outstanding issues. It includes fixing bugs in
software that prevented it from working the way it's supposed
to, and refreshing the user experience so folks can navigate
the site without encountering error messages, timeout, and slow
response times. And by the end of November, we're committed
that the vast majority of users will be able to review their
options, shop for plans, and enroll in coverage without the
problems way too many have been experiencing.
But consumers are using the site every day and continue to
do so, and problems are being solved, but we know that we don't
have a fully functioning system that consumers need and
deserve. We are still at the beginning of a 6-month open
enrollment which extends through the end of March, and there's
plenty of time to sign up. Just to put it in perspective, the
average open enrollment for an insurance plan is 2 to 4 weeks.
The new marketplace has a 26-week open enrollment, and those
who enroll by December 15th will be able to access their
benefits on day one.
Even with the unacceptable problems with HealthCare.gov,
which we are committed to fixing, the Affordable Care Act by
any fair measure is working for millions of Americans who are
benefiting from new health security, young adults, Americans
living with preexisting health conditions, seniors on Medicare.
The 85 percent of Americans who already have health coverage
are protected with new rights and benefits. The 15 percent of
our neighbors and friends who are uninsured have affordable new
options in a competitive market. And cost growth for health
care is lower than it's been in years.
Millions of Americans are clearly eager to learn about
their options and to finally achieve health security made
possible by the Affordable Care Act. My commitment is to
deliver on that promise.
Thank you, Mr. Chairman.
Mr. Upton. Well, thank you very much.
[The prepared statement of Secretary Sebelius follows:]
[GRAPHIC] [TIFF OMITTED]
Mr. Upton. I appreciate you being here this morning, and we
worked with our leadership to see that we don't have votes on
the House floor this morning so we won't be interrupted. I
appreciate your time for sure. And in an effort to allow every
Member to ask a question, we're going to be reducing the time
for questions to be just 4 minutes so that hopefully we can get
through all the Members that are here. And I'm going to be
pretty fast with the gavel, let me just say. So we've got
plenty of questions, so let's try and get through them.
You know, I think everyone in America remembers the
President's words: ``If you like your healthcare plan, you can
keep it. Period.'' Under the Affordable Care Act, insurance
policies that were in effect on March 23rd, 2010, when the law
was enacted, would be grandfathered. Then a few months later,
despite the President's word, you all at HHS helped promulgate
a new reg that in your own review showed that it effectively
could deny perhaps as many as more than 50 percent, maybe even
higher, of those holding individual policies, the right to
renew their own insurance plan.
And I would guess that there are a lot of us on this panel
today that are hearing from angry and confused constituents,
who are now being forced to go onto an inept Web site, whether
they like it or not, to shop for a new replacement policy.
They're finding premiums often more than 100 percent what they
were paying before, some even as high as 400 percent, as I've
heard from, and rising deductibles as well.
So when was the President specifically informed of the
regulation change? And, if so, was it pointed out that this
totally undermines his biggest selling point?
And I would note that on the screen in the statement that
he made more than 3 years after the regulation change was
promulgated, the President said again, ``So the first thing you
need to know is this: If you already have health care, you
don't have to do anything.''
So he's been on the same page from the very start, yet the
regulations changed months after the bill was enacted that are
now causing perhaps millions of Americans to be denied the
ability to renew their individual coverage.
Why was that change made, and did the President know it?
Secretary Sebelius. Well, Mr. Chairman, there was no
change. The regulation involving grandfathered plans, which
applied to both the employer market and the individual market,
indicated that if a plan was in effect in March of 2010 stayed
in effect without unduly burdening the consumer with reducing
benefits and adding on huge costs, that plan would stay in
effect and never have to comply with any of the regulations of
the Affordable Care Act. That's what the grandfather clause
said.
The individual market, which affects about 12 million
Americans, about 5 percent of the market, people move in and
out, they often have coverage for less than a year, a third of
them have coverage for about 6 months, and if a plan was in
place in March of 2010, and again did not impose additional
burdens on the consumer, they still have it. It's grandfathered
in.
Mr. Upton. But why not let the consumer decide whether they
want to renew it or not? Why were regulations promulgated in
the summer of 2010 that then undermined the ability for those
folks to re-sign up, which is one the reasons for the large
number of cancellation notices?
Secretary Sebelius. There were no regulation change. We
outlined the grandfather policy so people could keep their own
plan. We then began to implement the other features of the
Affordable Care Act. So if someone is buying a brand new policy
in the individual market today or last week, they will have
consumer protections for the first time. Many people in the
individual market are medically underwritten. That will be
illegal. Many women are charged 50 percent more than men. That
will be illegal. You cannot again eliminate someone because of
a preexisting health condition, you can't dump someone out or
lock someone out.
So those provisions--but if, again, a plan is in place and
was in place at the time that the President signed the bill,
and the consumer wants to keep the plan, those individuals are
grandfathered in, and that's happening across the country in
the individual market.
Mr. Upton. We're learning, in fact, that folks who did have
a plan who liked it, in fact, are being told that it's canceled
in the last--my time has expired. Let me yield to the ranking
member Mr. Waxman for 4 minutes.
Mr. Waxman. Thank you, Mr. Chairman.
I had to smile at your line of questioning because
everybody expected this hearing was about the Web site. That's
all we've been hearing about is the Web site.
But that's not the only complaint we've been hearing about
since the Affordable Care Act was adopted. We were told by our
Republican friends that millions of jobs would be lost, and, in
fact, there have been a gain of 7 million jobs. They said that
the costs for health care would skyrocket, and, in fact, the
opposite is true. They said there would be a massive shift to
part-time jobs, and the evidence doesn't support that. They
said tens of millions will lose their insurance, but, in fact,
everybody in this country is going to have access to health
insurance because they won't be discriminated against. They
said that it would explode the deficit, and yet all the
reputable organizations, like the Congressional Budget Office,
have told us that it's going to save us $100 billion over 10
years.
So we've had a litany of objections from the Republicans
about the Affordable Care Act, which has driven them to such a
frenzy, they even closed the government.
So now we have you before the committee. And you're being
asked--I suppose later you'll be asked about the Web site. But
let me pursue this question about individuals who have gotten
notices that they're going to have their individual insurance
policies canceled. They'll be able to get another plan, won't
they?
Secretary Sebelius. Actually, it's the law that they must
get another plan. Continuous coverage is part of the law.
Mr. Waxman. So----
Secretary Sebelius. And that wasn't the case in the past.
Mr. Waxman. So the Affordable Care Act, we're going to end
the worst abuses of insurance companies, we're going to create
consumer protections in the marketplace that they will be able
to buy a policy even if they've been sick in the past, that
women won't be charged more than men, that we're not going to
let insurance companies deny coverage because of preexisting
conditions, and we're not going to let them put these lifetime
caps. And there will be an essential benefit package, so you're
not just buying some things and not having other things
covered, you're going to have the minimum that everybody should
have: prescription drugs, mental health coverage, doctors and
hospitals.
Are these important consumer protections?
Secretary Sebelius. Well, I would say, Mr. Waxman, they're
very important. As a former insurance commissioner, I can tell
you that the individual market in Kansas and anywhere in the
country has never had consumer protections. People are on their
own. They could be locked out, priced out, dumped out, and that
happened each and every day. So this will finally provide the
kind of protections that we all enjoy in our healthcare plans.
As part of a group, as part of a plan that has prenegotiated
benefits, we enjoy that kind of health security. And
individuals buying insurance on their own, farm families,
entrepreneurs mom-and-pop shops, young adults have never had
that kind of health security.
Mr. Waxman. Well, now they're going to have this health
security. And most of the plans, as I understand it, that
they're no longer going to be able to keep don't meet all the
standards of the law.
Secretary Sebelius. Well, again, I think you may have heard
Pat Geraghty from Florida Blues, who was on some of the Sunday
shows, and he talks about the fact that the Florida plans want
to keep their customers. They have new plans to offer. They
feel that a lot of people, and these are Mr. Geraghty's words,
will have a much better plan at a similar or lower cost; 50
percent of these 11 to 12 million people qualify for a subsidy,
qualify for some financial help purchasing insurance for the
first time ever.
Mr. Waxman. The bottom line is that people with good
coverage, like Medicare, Medicaid, employer coverage, can keep
that. People with grandfathered plans in the individual market
will be able to keep it. But if insurance companies sold you a
new, modified health insurance policy after the date of the
enactment that does not meet the law's standards, then those
people will be able to go into the exchange and buy a real
solid health insurance plan that won't discriminate against
them or anybody else. I think that's a good result, I'm pleased
with it, and I think most people will be as well.
Mr. Upton. Gentleman's time has expired.
The chair would recognize the vice chair of the committee
Ms. Blackburn.
Mrs. Blackburn. Thank you, Mr. Chairman.
Madam Secretary, before, during, and after the law was
passed, the President kept saying, ``If you like your
healthcare plan, you can keep it.'' So is he keeping his
promise?
Secretary Sebelius. Yes, he is.
Mrs. Blackburn. OK. What do you say to the 300,000 people
in Florida you just mentioned or to the 28,000 in Tennessee
that cannot get health insurance, their plans are terminated?
Is he keeping his promise to them?
Secretary Sebelius. Well, first of all, Congresswoman, they
can get health insurance. They must be offered new plans, new
options, either inside the marketplace, or if they don't
qualify for a financial subsidy, they can shop in or out of the
marketplace.
Mrs. Blackburn. What do you say to----
Secretary Sebelius. They absolutely will have new coverage.
Mrs. Blackburn. What do you say to NBC News, who says
millions are going to lose their coverage?
Secretary Sebelius. In all deference to the press corps,
many of whom are here today, I think that it's important to be
accurate about what is going on, and I would defer again to the
president of the Blues plan. People will have ongoing coverage,
they will be offered new plans----
Mrs. Blackburn. Madam Secretary, let me tell you
something----
Secretary Sebelius [continuing]. In the market right now
will qualify----
Mrs. Blackburn. What do you say to Mark and Lucinda in my
district who had a plan, they liked it, it was affordable, but
it is being terminated, and now they do not have health
insurance?
Secretary Sebelius. Insurance companies cancel individual
policies year in and year out. They are a 1-year contract with
individuals. They are not lifetime plans. They are not an
employer plan. Your constituents will have lots have options in
the market.
Ms. Blackburn. It's what they wanted and I will remind you,
some people like to drive a Ford, not a Ferrari, and some
people like to drink out of a red Solo cup, not a crystal stem.
You're taking away their choice.
Let's put the screen shot up.
I want to go to the cost of the Web site and talk about the
Web site. This is what is happening right now with this Web
site. We've had somebody in the back trying to sign on. It is
down. It is not working.
Last week I asked for the cost from each of the contractors
that were with us last week. So can you give me a ballpark of
what you have spent on this Web site that does not work that
individuals cannot get to? What is your cost estimate?
Secretary Sebelius. So far, Congresswoman, we have spent
about $118 million on the Web site itself, and about $56
million has been expended on other IT to support the Web.
Ms. Blackburn. OK. Would you submit a detailed accounting
of exactly what has been spent? And when do you expect
constituents to stop getting these kind of error messages?
Secretary Sebelius. Again, I talked to the president of
Verizon over the weekend on two occasions. Verizon hosts the
cloud, which is not part of the Web site; it is a host for a
number of Web sites.
Mrs. Blackburn. Right.
Secretary Sebelius. The Verizon system was taken down
Saturday night into Sunday. It was down almost all day Sunday.
They had an additional problem that they notified us about
yesterday, and it continues on. So I'd be happy to talk to the
president of Verizon and get him to give you information about
the Web site.
Ms. Blackburn. Let me come back to that, because I want to
get to this issue of exactly who was in charge of this project,
because you're now blaming it on the contractors and saying
it's Verizon's fault.
So let me ask you this: Did you ever look at outsourcing
the role of the system integrator? And obviously you did not,
from the contractors that we had last week. You all--they had
several different people, whether it was you, or Gary Cohen, or
Michelle Snyder, or Henry Chao, that they thought were in
charge. So who is responsible for overseeing this project? Is
it you or your designee?
Secretary Sebelius. Let me be clear, I'm not pointing
fingers at Verizon, I'm trying to explain the way the site
operates. We own the sites. The site has had serious problems.
I know that----
Ms. Blackburn. Who is in charge, Madam Secretary?
Secretary Sebelius. The person now in charge as an
integrator is QSSI, one of our----
Ms. Blackburn. Who was in charge as it was being built----
Secretary Sebelius. The CMS team was in charge up until----
Ms. Blackburn. At that team, who is the individual----
Secretary Sebelius. Michelle Snyder is the----
Mrs. Blackburn. Michelle Snyder is the one responsible for
this debacle.
Secretary Sebelius. Well, excuse me, Congresswoman,
Michelle Snyder is not responsible for the debacle. Hold me
accountable for the debacle. I'm responsible.
Mrs. Blackburn. OK. Thank you. I yield back.
Mr. Upton. The chair recognizes Mr. Dingell from the great
State of Michigan.
Mr. Dingell. Thank you for your courtesy. I have a few
questions I'll be asking on behalf of the Congresswoman Shea-
Porter, but I'll do that by writing. I ask unanimous consent
that I be prepared to revise and extend my remarks.
Mr. Upton. Without objection.
Mr. Dingell. Mr. Chairman, I would like to begin by
thanking you, welcoming the Secretary to a room in which her
distinguished father, former Governor of Ohio, served for so
many years.
I begin my questions by quoting from an expert for whom I
have enormous respect. He said as follows: ``As I mentioned
earlier, the new benefits and its implementation are hardly
perfect. Rather than trying to secure and to scare and confuse
seniors, I would hope that we could work together as we go
through the implementation phase to find out what is wrong with
the program and if we can make some changes to fix it. Let us
do it, and let us do it in a bipartisan fashion. It is too big
a program and is too important to too many people to do that.
But having said that, it does appear that it is working. Let us
admit it, you know, and not keep beating a dead horse.'' My
beloved friend Mr. Barton, who I think gave us the beginning of
our efforts today.
Madam Secretary, I've seen reports of consumers receiving
plan cancellation notices from their insurance companies saying
that plans are no longer available. Does the ACA require
insurance companies to discontinue the plans that people had
when the law was passed, yes or no?
Secretary Sebelius. Not when the law was passed if the
plans have not changed. No, sir. That's the grandfather clause.
Mr. Dingell. Now, that's because the plans that existed
prior to the passage of the law are grandfathered in, as you
have said.
Secretary Sebelius. That's correct.
Mr. Dingell. So if an insurance company is no longer
offering a certain plan, that's because that insurance company
made a decision to change their policies, and that caused them
to take away the grandfathered status from the insurance
purchaser; is that right?
Secretary Sebelius. That is correct.
Mr. Dingell. Now, Madam Secretary, I want you to submit for
the record a statement of what it is we can do about insurance
companies that run around canceling the policies of their
people. And I don't have time to get the answer, but I want to
get a very clear statement from you as to what you can do so we
can take some skin off some folks that have it coming.
Secretary Sebelius. Again----
Mr. Dingell. Madam Secretary, it's my understanding that
these decisions of a business character are most common in the
individual insurance market, and that much turnover already
exists and existed prior to the enactment of the legislation.
Secretary Sebelius. That's correct.
Mr. Dingell. Is that correct?
Secretary Sebelius. Yes, sir.
Mr. Dingell. Is it correct that 35 to 67 percent of the
enrollees in the individual market leave their plan after 1
year for different reasons?
Secretary Sebelius. A third are in about less than 6 months
in the individual market, and over 50 percent are in for less
than a year, yes, sir.
Mr. Dingell. Now, in the cancellation letters which move
around from the insurance companies, some insurance companies
are suggesting an alternative plan at a higher price. Do they
have the right to do that?
Secretary Sebelius. Well, they have a right to do that,
sir, but consumers have a right to shop anywhere to compare
plans, and they have choices now that they've never had before
and some financial assistance coming their way for about 50
percent of those people.
Mr. Dingell. And they have no right to enforce that----
Secretary Sebelius. Oh, absolutely not.
Mr. Dingell [continuing]. Demand on the insurance----
Secretary Sebelius. No one is rolled over into a plan. And,
in fact, individuals for the first time ever will have the
ability to compare plans, to shop, and to make a choice inside
or outside the marketplace.
Mr. Dingell. Looks to me like the insurance companies are
trying to inflict on their customers the view that this is
their right, and that this is the only option available to
them; is that correct?
Secretary Sebelius. Well, I think that insurance companies
would like to keep their customers. Having said that, customers
for the first time have a lot of choices because they can't be
locked out of the----
Mr. Dingell. Companies have no right to enforce that view
on the customer.
Secretary Sebelius. There is no rule that says you have to
stay with your company or you have to be rolled over.
Mr. Dingell. And you don't have to believe them----
Mr. Upton. Gentleman's time has expired.
Mr. Dingell [continuing]. When they come forward and tell
you that you've got to buy a particular policy; is that right?
Secretary Sebelius. Absolutely.
Mr. Upton. Gentleman's time has expired.
The chair would recognize the gentlemen from Texas Mr.
Barton.
Mr. Barton. Thank you, Mr. Chairman. Before I ask my
questions, we have a former member of the committee on the
Democrat side from the great State of Kansas in the audience,
Mr. Slattery. And we're glad to have you.
And, Madam Secretary, we're glad to have you, too.
Secretary Sebelius. Thank you, sir.
Mr. Barton. There is a famous movie called The Wizard of
Oz, and in The Wizard of Oz, there was a great line. Dorothy,
at some point in the movie, turns to her little dog Toto and
says, ``Toto, we're not in Kansas anymore.'' Well, Madam
Secretary, while you're from Kansas, we're not in Kansas
anymore. Some might say that we are actually in The Wizard of
Oz land, given the parallel universes we appear to be
habitating. Mr. Waxman and most of those on the Democrat side
think things are great. You, apparently, although you did
apologize, and you have said it's a debacle, you also seem to
think that the Affordable Care Act is great. Well, myself and
others have a different view. Ultimately the American people
will decide.
Now, last week, when the contractors were here, I focused
my attention on the apparent lack of privacy in the Web site.
If we'll put up the first slide that I had last week, if we
can.
This is what's public, Madam Secretary, and it's basically
a disclaimer that says that any unauthorized attempt to upload
information or change information on the Web site is
prohibited. It really doesn't say anything about privacy. But
you do have to accept that in order to go forward with the
application.
The next slide shows what's not public. This is in the
source code. We tried to determine this morning if it was still
in the source code, but it's been pointed out the Web site is
down.
This is much more, what I would say, frightening to me. It
says you have no reasonable expectation of privacy regarding
any communication or data transiting or stored on the
information system. At any time and for any lawful government
purpose, the government may monitor, intercept, search and
seize any communication or data transiting or stored on the
information system. Any communication or data transiting or
stored on this information system may be disclosed or used for
any lawful government purpose.
Cheryl Campbell of CGI Federal said she was aware of it,
but said that it wasn't her responsibility to put that in the
source code. Were you aware of it, and was it your
responsibility to put this in the source code?
Secretary Sebelius. Mr. Barton, I did not put things in the
source code. I can tell you it's my understanding that that is
boilerplate language that should not have been in this
particular contract because there are the highest security
standards are in place, and people have every right to expect
privacy.
Mr. Barton. All right. Now, the last time we could check,
this was still there. You're given almost unlimited authority
under the Affordable Care Act to administer it. Will you commit
to the committee and to the American people that, one, you do
want to protect their privacy; and, two, you will take this
out, fix it, make sure that it doesn't have bearing on people
that try to apply through the Web site?
Secretary Sebelius. Yes, sir. And we have had those
discussions with CGI, and it is under way. I do absolutely
commit to protecting the privacy of the American public, and we
have asked them to remove that statement. It is there in error,
it needs to be taken down, and we should be held accountable
for protecting privacy.
Mr. Barton. Well, thank you, Madam Secretary. I sincerely
appreciate that, and I'm sure the American people do, too.
My last question, or it's really a comment. I've introduced
H.R. 3348, which says let's make this system voluntary for the
first year, since we're having so many problems, and let the
American people decide. What that means is if people choose not
to participate, they would not be charged the penalty for
nonparticipation.
Would you support such a reasonable approach to this while
we work out the problems in the system?
Secretary Sebelius. No, sir.
Mr. Barton. OK. Well, that's an honest answer.
Mr. Upton. Gentleman's time has expired.
Mr. Barton. Thank you, Madam Secretary.
Mr. Upton. Chair would recognize the gentleman from New
Jersey Mr. Pallone.
Mr. Pallone. Thank you, Mr. Chairman.
I know we're not in Kansas, but I do believe increasingly
we're in Oz because of what I see here. So this ``Wizard of
Oz'' comment by my colleague from Texas, I think, is
particularly apropos given what we hear on the other side of
the aisle.
I don't know how you keep your cool, Madam Secretary, you
know, with this continuous effort on the part of the GOP to
sabotage the ACA, to scare people, and bring up red herrings.
And I think that this privacy issue is another red herring, and
I'm going to ask you a question about that.
But before that I just wanted to say, this whole idea
that's being brought up today that somehow, you know, policies
are being canceled, and people don't have alternatives, it's
just another red herring. You know, what I think my colleagues
on the other side forget is that this is not socialized
medicine; this is, in fact, private insurance in a competitive
market. And if I'm an insurance company, and all of a sudden
everyone else is selling a better policy with better benefits
at a lower price, I can't continue to sell a lousy skeletal
policy that doesn't provide benefits and costs more because
I'll be out of the market.
And so that's what's happening here. Insurance companies
are canceling lousy policies with high prices because they
can't compete, and that's what's going to happen when you have
a private insurance market, which is what we have here. We
don't have a government-controlled system; we have private
markets. So I just wanted to make that point.
But I have to drill down on what Mr. Barton said here. You
know, before reform, the individual insurance market was
dysfunctional, premiums would shoot up if people got sick,
their coverage could be canceled if they had a preexisting
condition, and they did not have secure quality coverage. Now,
I've heard my Republican colleagues say that patient health
information will be at risk in this application process, and
this is flat out false. In fact, the ACA makes a giant leap
forward for protecting health information by taking it
completely out of the insurance application process, by banning
discrimination based on preexisting conditions.
Mr. Barton, again, is raising this red herring, just like
the cancellation of insurance, by talking about privacy. But,
Madam Secretary, prior to the ACA, when people applied for
insurance coverage, did insurers make them provide a long,
detailed, and basic medical history, but now, because the law
bans discrimination based on preexisting conditions,
individuals will not have to have provide this information in
their applications? So regardless of this clause, please
comment on the privacy issue and why it's irrelevant.
Secretary Sebelius. Well, Mr. Pallone, in the past any
individual American who was in an employer-based coverage, in
government coverage like the ones we enjoy, in Medicare, in
Medicaid, in the VA, a whole variety of plans, that's about 95
percent of insured Americans, had no medical underwriting, had
group protections, had consumer protections. The people who
were outside that consumer-protected space were individuals
buying they own coverage in an individual market. Medical
underwriting, demanding health records, and often going through
extensive doctor interviews and getting health records was a
standard for that market. Pricing could vary widely depending
on gender, depending on health condition. People could be
denied coverage, and were frequently.
That's the market that is currently being reformed with
consumer protections. If a person had a policy in place in
March of 2010, liked that policy, and the insurance company
made no changes to disadvantage the consumer, those policies
are in place, you keep your plan, you like it, and that goes
on.
For the people who, though, had a medically underwritten
policy, were paying more than their neighbor because they
happened to be female, could not get their health condition for
a fixed hip written into their insurance plan, they will have a
new day in a very competitive market. Twenty-five percent of
the insurers are brand new to the market, and they are offering
competitive plans.
Mr. Pallone. Mr. Chairman, could I just ask that this
document----
Mr. Upton. Sure. Put it in the record. Without objection.
Mr. Pallone. Thank you.
[The information appears at the conclusion of the hearing.]
Mr. Upton. The chair would recognize Mr. Hall.
Mr. Hall. Thank you, Mr. Chairman.
Madam Secretary, I think Congresswoman Blackburn asked you
about the Federal Government, how much they spent today, and
they are spending some money as we speak, aren't they? It's
down right now, isn't it? You projected ongoing problems.
Secretary Sebelius. I'm sorry, sir. I'm having a hard time
hearing. What was the----
Mr. Hall. She asked you how much it had spent today, and
I'm asking what you expect to pay in addition to that on
repairs that the Web site's going to require, and they're
requiring them as we speak here. So those are things you
projected, you knew they would happen, and they will happen.
But you surely looked ahead, and you have some estimate of what
is going to happen.
Secretary Sebelius. Yes, sir.
Mr. Hall. And going to cost.
Secretary Sebelius. For our two major contractors, who are
QSSI, a subsidiary of United, and for CGI, there are obligated
amounts. For CGI, who is in charge of the entire application,
there has been $197 million obligated, and that is to last
through March of 2014. And as I said before, about $104 million
has been expended in that obligated amount.
Mr. Hall. I'm going try to be here in 2014 to be sure that
your testimony is correct, OK?
I'm just joking with you.
Secretary Sebelius. OK.
Mr. Hall. Were you born in Kansas? Meade, Kansas?
Secretary Sebelius. I was not. I was born in Cincinnati,
Ohio. I married a Kansan and went to Kansas.
Mr. Hall. All right. I was in third grade there, and I
thought I saw you on a tricycle there one day.
Secretary Sebelius. Well, it was an illusion.
Mr. Hall. Let me ask you a question. Have you ever rejected
a financial bill from one of the contractors? Have you ever?
Secretary Sebelius. Have I ever----
Mr. Hall. Rejected a financial bill from one of them.
Secretary Sebelius. Sir, again, our----
Mr. Hall. Well, I guess you can say yes or no.
Secretary Sebelius. Our accounting office does a routine
audit and review of every bill that comes in before they do it.
I do not personally. I want to be very accurate about I don't
personally pay contracts, negotiate contracts. By law and by
precedent, that's really illegal for someone who isn't a
warranted contract officer to engage in the debate or
discussion around Federal contracts.
Mr. Hall. How much has the administration spent on the
exchanges in total; not just HealthCare.gov, but all of the
exchanges?
Secretary Sebelius. I'm sure----
Mr. Hall. How difficult is that figure to give me or if you
can't give----
Secretary Sebelius. I would like to get it to you in
writing very quickly.
Mr. Hall. Madam Secretary, I don't know how much time I've
got left, but I'd like to talk about a couple of businesses in
my district who are struggling with how to move forward. One is
a manufacturer, and one is in the pet boarding and training
business. One has 85 employees, and the other has 56. Here's
some quotes from some of their recent letters.
``The situation we're in is we would have to pay $170,000
in penalties under Obamacare. This is another example of the
government picking winners and losers. We are the losers.
There's no way I can be competitive if I have to raise my
prices to cover $170,000. Here are my options: Do not pay the
penalty, raise my prices, and go out of business, 85 people
lose their jobs; layoff 35 employees who don't have to pay the
penalty, and move more production to this country. Reduce 35
jobs.''
And here's a quote from the other: ``Since our high-labor,
low-margin business cannot afford to pay for insurance for our
employees, we're faced with either closing our business,
perhaps through bankruptcy, so there are heavy financial
obligations that would continue whether we operate or not; fire
enough employees to get under 50 employees limits and close
some of our business. Even if we close the location, we cannot
escape many expenses such as rental agreements.''
What am I supposed to tell these people?
Secretary Sebelius. Well, sir, I think that in the employer
market, about 95 percent of all American businesses are exempt
from any kind of requirement to cover employer-employee
insurance, and they are outside the law. They continue to be
outside the law. But they will have some new options for those
who want to cover their employees, and some new tax credit
possibilities.
For large employers, about 96 percent of them already cover
their employees. And, as you know, the penalty that your
constituents refer to is not a penalty that is imposed in 2014.
It is being discussed with businesses about what kind of
information is exchanged, and it will take place in 2015.
Mr. Hall. I thank the----
Mr. Upton. Gentleman's time has expired.
Mr. Hall. He's going to use the gavel on me if you don't
hush.
Mr. Upton. Gentleman's time has expired.
Mr. Hall. I yield back my time.
Mr. Upton. The chair would recognize the gentlelady from
California Ms. Eshoo.
Ms. Eshoo. Thank you, Mr. Chairman.
Welcome, Madam Secretary. You're a distinguished woman. You
have distinguished yourself and your State, the offices that
you've held, and now working for the American people, and I
salute you for it.
I want to really congratulate my Republican pals for being
absolutely 1,000 percent consistent. You love what's wrong with
the Web site, and you detest what's working in the Affordable
Care Act. And I think that that is on full display here.
But let's get back to the Web site, because that's what the
hearing is about. It's my understanding that November 31st is a
hard date for having everything up and running. Do you have--
now, HHS did testify in September that they were 100 percent
confident that the site would be launched and fully functional
on time on October 1st. That didn't work. Do you have full
confidence in this new hard date?
Secretary Sebelius. Congresswoman, I can tell you that the
assessment that we have made is that it will take until the end
of November for an optimally functioning Web site. I know that
the only way I can restore confidence that we get it right is
to get it right. So I--I have confidence, but I know that it
isn't fair to ask the American people to take our word for it.
I've got to fix this problem, and we are under way doing just
that.
Ms. Eshoo. But are you confident that--I think I said
November 31st, which is----
Secretary Sebelius. I thought it was a trick question.
Ms. Eshoo [continuing]. Does not exist. But November 30th.
You have confidence in November 30th?
Secretary Sebelius. I do.
Ms. Eshoo. Is there any penalty to QSSI or CGI for not
delivering on what they promised?
Secretary Sebelius. Well, I think the--as you can see, we
have a--obligated funds for a contract. We certainly have not
expended all these funds. And we expect not only the CMS team,
but our contractor partners to fulfill their obligations and--
--
Ms. Eshoo. But if they fail to fulfill their obligations--I
don't know what's in the contract--is there a penalty?
Secretary Sebelius. There isn't a built-in penalty, but I
can tell you that paying for work that isn't complete is not
something that we will do.
QSSI, as you know, has taken on a new role as integrator.
The hub that they built and have in operation is working
extremely well not only for the Federal exchanges, but all the
State-based markets are using the hub. And that's why we had
confidence in their ability to actually take this next role on
and coordinate the activities moving forward, which have to be
driven with a very clear set of outcomes, very accountable
timelines and deadlines, and they will be helping to manage
that process.
Ms. Eshoo. On the issue of security, there was a security
breach that arose recently, that I read about at any rate. And
what I think is very important here, because the issue of
privacy has been raised, and I think that that has been
answered, because, very importantly, there isn't any health
information in these systems, but there is financial
information.
So my question to you is has a security wall been built,
and are you confident that it is there, and that it will
actually secure the financial information that applicants have
to disclose?
Secretary Sebelius. Yes, ma'am. I would tell you that there
was not a breach. There was a blog by a sort of skilled hacker
that if a certain series of incidents occurred, you could
possibly get in and obtain somebody's personally identifiable--
--
Ms. Eshoo. But isn't that telling? Isn't that telling?
Secretary Sebelius. And we immediately corrected that
problem. So there wasn't--it was a theoretical problem that was
immediately fixed.
I would tell you we are storing the minimum amount of data
because we think that's very important. The hub is not a data
collector. It is actually using data centers at the IRS, at
Homeland Security, at Social Security to verify information,
but it stores none of that data. So we----
Ms. Eshoo. Thank you.
Secretary Sebelius. So we don't want to be----
Mr. Upton. The gentlelady's time has expired.
The chair recognizes Mr. Shimkus.
Mr. Shimkus. Thank you, Mr. Chairman.
Welcome, Madam Secretary.
Madam Secretary, before I start my questions, the
Washington Post gave the administration and the President,
yourself, four Pinocchios on this whole debate of if you like
the insurance you have, you can keep it. Would you recommend to
the president that he stop using that term? Wouldn't that be
helpful in this debate?
Secretary Sebelius. Well, sir, I think he used the term at
the time that the law was passed, and he continued to say----
Mr. Shimkus. And as of September 26th also, so----
Secretary Sebelius. That is why we wrote the grandfather--
--
Mr. Shimkus. So the answer is you don't buy--you don't
believe that The Washington Post, and therefore----
Secretary Sebelius. Well, I haven't read The Washington
Post.
Mr. Shimkus. Well, we'll hand this down to you----
Secretary Sebelius. Thank you.
Mr. Shimkus [continuing]. So you can see it. Have you ever
shopped, I know you have, but this is at a grocery store with a
coupon?
Secretary Sebelius. Yes.
Mr. Shimkus. Have you ever used a coupon?
Secretary Sebelius. Yes.
Mr. Shimkus. So the coupon gives you the terms and
conditions of when you go to the checkout to get whatever is
off the price of the goods. When you all added the ``See Plans
Now'' option, you, in essence, gave the searcher, in essence, a
coupon based upon what they're seeing there. The desire was,
let people know what the price is; however, as the news
reported, and I followed up in last week's hearing, was that if
you are under 50 years old, you get quoted the price of someone
who is 27. If you are older than 50, could be 64, you get
quoted a price of someone who is 50 years old. Isn't that
misleading?
Secretary Sebelius. Well, sir, the learn side of the Web
site, which has been up since actually late 20----
Mr. Shimkus. So that is truthful, then? If you quote a
price----
Secretary Sebelius. It is clearly a hypothetical situation
that allows people to----
Mr. Shimkus. OK. On the ``See Plans Now'' option, are you
saying this is a hypothetical? That is not what it says on the
site. It says this is the price when you put in your age. And
if your age is 49, it quotes you as if you are 27.
Secretary Sebelius. Sir, the only way someone can get an
accurate information about their price is to get their
individual----
Mr. Shimkus. Let me ask you another----
Secretary Sebelius [continuing]. Eligibility determined.
Mr. Shimkus. When did you decide to use this below 50 at 27
and above 50 at 50 years old? When did you make that decision?
Secretary Sebelius. That was decided by the team as we put
up----
Mr. Shimkus. By who? Who made the----
Secretary Sebelius. I will get you that information.
Mr. Shimkus. The problem with the whole debate is you all
won't tell us who made the decision.
Secretary Sebelius. I can tell you I did not design the
site.
Mr. Shimkus. So who?
Secretary Sebelius. I will get the----
Mr. Shimkus. Well, who made the decision on the 27-year-old
quote for someone who is 50?
Secretary Sebelius. I just said I will get you that
information, sir.
Mr. Shimkus. Thank you. Let me go to--because it is
misleading, and the White House insists it didn't mislead the
public, and of course, we find out that you did. Let me finish
on this debate. It is another transparency issue. If someone, a
constituent of mine or someone in this country, has strongly
held pro life views----
Voice. Oh, here we go.
Mr. Shimkus [continuing]. Can you commit to us to make sure
that the Federal exchanges that offer that is clearly
identified and so people can understand if they are going to
buy a policy that has abortion coverage or not? Because right
now, you cannot make that determination.
Secretary Sebelius. Sir, I--I don't know. I know exactly
the issue you're talking about. I will check and make sure----
Mr. Shimkus. Here's----
Secretary Sebelius [continuing]. That----
Mr. Shimkus. OK. Thank you.
Secretary Sebelius [continuing]. Is clearly identifiable.
Mr. Shimkus. Well, here's----
Secretary Sebelius. You're saying----
Mr. Shimkus. Here's our request. Can you provide for the
committee the list of insurers in the Federal exchange who do
not offer as part of their package abortion coverage?
Secretary Sebelius. I think we can do that, sir.
Mr. Shimkus. Well, you should be able to do it.
Secretary Sebelius. I----
Mr. Shimkus. So----
Secretary Sebelius. I just said----
Mr. Shimkus. No. You said if we can do it.
Secretary Sebelius. No. I think we can do that, is what I
said.
Mr. Shimkus. I think or I know we can do it?
Secretary Sebelius. Sir, I can't tell you what I don't know
firmly right now. I know that is the plan. I will get that
information to you. I----
Mr. Upton. Gentleman's time has expired.
The chair recognizes Mr. Engel from New York.
Mr. Engel. Well, thank you, Mr. Chairman.
Madam Secretary, I appreciate your coming today to answer
questions about the Affordable Healthcare Act.
You know, my Republican colleagues' actions here remind me
a story I read when I was a little boy, and that is the story
of Chicken Little, who ran around yelling, ``The sky is
falling. The sky is falling,'' but unlike Chicken Little, my
Republican colleagues are actually rooting for the sky to fall.
Republicans are holding this hearing today under the
auspices of an investigative hearing, as if they want to get to
the bottom of what went wrong with the Web site in order to
help fix it.
But I don't think, Madam Secretary, there's one person in
this room who is naive enough to actually think that the
Republicans want to see this law work. They voted over 40 times
to repeal the law. They shut down the government and threatened
to force a default in order to stop it. They're rooting for
failure.
Madam Secretary, can you tell us what would be the impact
on Americans' health insurance if Republicans had been
successful in their efforts to defund or repeal the Affordable
Care Act?
Secretary Sebelius. Well, I think that the estimates of the
Congressional Budget Office is that would have increased the
deficit by about $110 billion in the first decade and close to
a trillion dollars in the second decade. We know that we have
42 or 43 million Americans without health insurance at all,
some of them Medicaid eligible and some in the--over the
Medicaid eligibility. Thirty governors so far, Republicans and
Democrats, have declared their support for moving ahead with
Medicaid expansion, but absent that, the Affordable Care Act,
those folks would be without any kind of health security.
And in the private market, what we know is it takes a real
toll, but I'd say the biggest issue is not just the financial
toll, not the community toll, not the country toll, which is
significant. I have a good friend who runs the cancer center at
the University of Kansas. I was with him and cancer researchers
recently, and he said that if you get a cancer diagnosis, you
are 60 percent more likely to live 5 years and beyond if you
have insurance than if you don't. I think that's a pretty
powerful statement for why we need affordable healthcare for
all of our citizens.
Mr. Engel. Well, thank you. The Republicans have not been
able to defund or repeal it, but they have denied requested
funding. They've raised specious arguments about death panels
and socialized medicine. And they've worked to intimidate
groups that could help the implementation effort. There has
been the spreading of misinformation about the cost of
coverage, we hear some of that today, and to actively dissuade
the uninsured from seeking coverage.
So, Madam Secretary, how have these tactics impacted your
ability to implement the Affordable Care Act?
Secretary Sebelius. Well, I don't think there's any
question that a lot of people need a lot of information. I
think it's one of the reasons we had millions visit the site,
try to visit the site. It's why I am so frustrated and
disappointed that the site is not fully functional and why I'm
so committed to getting it functional, because clearly there is
a demand. We need to get information to people about the law.
This is the law. This is not any longer a debate. It was a law
passed by both Houses of Congress, signed by the President of
the United States, upheld by the Supreme Court. The president
was reelected. It is the law, and people have benefits and
rights under that law, and we've got to get that information so
they can make good choices for themselves and their families.
Mr. Engel. Well, thank you. It is the law, and frankly, I
find it disconcerting that my Republican colleagues have done
nothing but root for this law to fail for the last 3 and a half
years, and now there's a big show here of being upset at
problems with the Web site, of keeping people from signing up
for coverage fast enough.
So I would just say to my colleagues on the other side of
the aisle, you're really on the wrong side of history here. The
Web site will be fixed and millions of Americans will be able
to get quality affordable health insurance coverage through the
Affordable Care Act.
And, again, I thank you for being here today, Madam.
Mr. Upton. Mr. Pitts, chairman of the Health Committee.
Mr. Pitts. Thank you, Mr. Chairman. Welcome, Madam
Secretary.
Secretary Sebelius. Mr. Pitts.
Mr. Pitts. Have you personally tried to register or enroll
on the Web site?
Secretary Sebelius. Sir, I created an early lite account so
I would see the prompts that were coming to people who were
interested. I did work my way to the application feature fairly
early on, but frankly, I have affordable healthcare, so I
didn't try the eligibility.
Mr. Pitts. No. I just wondered if you'd been through the
process that millions of Americans are having to go through.
Madam Secretary, the initial Web site crashes appear to be
largely a result of the decision to prevent browsing of the
plans. CGI Federal testified at our hearing last week that they
had designed the Web site to allow users to browse and compare
plans before having to create an account. Ms. Campbell told us
that 2 weeks prior to the October 1st launch, they were told to
turn off the browsing feature. Were you aware in September that
this decision was made?
Secretary Sebelius. Sir, I wasn't aware of that particular
decision. That was made by the CMS team. I was aware that we
were paring back some features to not put additional risk on
the Web site. It seems----
Mr. Pitts. And who made that decision?
Secretary Sebelius [continuing]. Ironic at this point.
Mr. Pitts. Who made that decision?
Secretary Sebelius. Administrator Tavenner made that
decision.
Mr. Pitts. And do you know why that was made?
Secretary Sebelius. Yes, sir. Because we were anxious to
get the Web site up and running and functional, which we
clearly have failed to do to date, although I would suggest the
Web site has never crashed. It is functional but at a very slow
speed and very low reliability and has continued to function.
Having said that, they pared down some of the features,
feeling that it would be better to load them in later. One was
the shop-and-browse feature, another was the Spanish version of
the Web site, and the Medicaid transfers. All three of those
issues----
Mr. Pitts. All right.
Secretary Sebelius [continuing]. Were pared down in
September----
Mr. Pitts. Thank you.
Secretary Sebelius [continuing]. To not load the system.
Mr. Pitts. Thank you.
Last week, CGI Federal and QSSI testified that CMS was
responsible for end-to-end testing and that they believed that
months of testing would have been preferable to 2 weeks. Do you
believe that 2 weeks was enough time to complete testing of the
entire system?
Secretary Sebelius. Clearly not.
Mr. Pitts. And when were you made aware of the result of
the test, including the one where the system collapsed with
only a few hundred users?
Secretary Sebelius. Sir, leading up to the October 1st
date, we had regular meetings with not only a team at CMS but
administrators involved. I was made aware that we were testing,
and as we found problems, we were fixing those problems. And I
think there is a CGI report at mid-August identifying some
problems. And between August and October, that became the punch
list for CGI to fix those problems. That's why you test.
Mr. Pitts. Now, in the Washington Post, on October 21st,
there was an article that said about a month before the
exchange opened, a testing group of 10 insurers urged agency
officials not to launch the site, because it was riddled with
problems. Were you aware in September that insurers recommended
a delay in the launch of the exchange?
Secretary Sebelius. I was not aware that they recommended
delay. I know everyone was concerned that there were risks and
there were likely to be problems with a brand new integrated
insurance system. I don't think anyone ever estimated the
degree to which we've had problems in the system, and certainly
the contracting partners did not.
Mr. Pitts. And did HHS respond to the insurers'
recommendation to delay the launch?
Secretary Sebelius. Sir, I wasn't in the meeting. I don't
know what occurred in the meeting----
Mr. Pitts. Can you find out----
Secretary Sebelius [continuing]. And I don't know who they
talked to.
Mr. Pitts [continuing]. And answer that question for us?
Secretary Sebelius. Sure. I will get back to you.
Mr. Pitts. Thank you.
Thank you, Mr. Chairman.
Mr. Upton. Mr. Green.
Mr. Green. Thank you, Mr. Chairman.
Madam Secretary, thank you for taking time to be here
today. I represent parts of eastern north Houston, Harris
County, and our district has one of the highest uninsured rates
in the country. Even worse, we have one of the highest rates of
people who have jobs but don't receive their insurance through
their employer. It's for this reason that I believe Houston
would be a good place for you to come and spread the word about
the tremendous benefits of the Affordable Care Act, however, we
learned your offices--you're unable to attend because of
scheduling conflicts. And hopefully we can have an agreement
that sometime in the future you will come to the fourth largest
city that probably has the highest number of uninsured in a
metropolitan area. And, of course, we're in the State of the
Texas, that has the highest uninsured in the country.
It's important to me and our constituents to get it right,
and that's why I share your and the President's disappointment
the Web site is not working as planned. November 30th is not
soon enough. Many of my constituents have been waiting for
years to be able to purchase health insurance, and we owe it to
them to get the marketplaces up and running. The contractors
have not served our country well and should fix it or not be
paid.
Now we're hearing about the cancellation letters being sent
by insurance companies to their customers notifying them that
their plans are no longer offered.
Are these Americans losing their healthcare coverage
because of the Affordable Care Act, or is it because these
plans were changed after the enactment of the act?
Secretary Sebelius. I would say it's the latter, sir. If a
plan was in place since the enactment of the act, no one would
have received a cancellation letter.
Mr. Green. So if somebody in America had an insurance plan
before the act and the President was correct, if you like what
you have, you could keep it.
Secretary Sebelius. Yes, sir.
Mr. Green. The plans were changed, and so now they have to
comply with the new law.
Secretary Sebelius. They could either choose to be
grandfathered and keep the same plan, which meant the same
benefits. And actually the regulation allows insurance
companies to charge medical inflation, plus the trend line, so
they didn't have to charge the same price; they could increase
it. They could increase copays, they could increase
coinsurance. What they couldn't do is cancel benefits that the
policyholder relied on, they couldn't disadvantage the
policyholder. But if that plan is in effect, absolutely, it is
still in effect.
Mr. Green. OK. But some of these millions of letters we're
hearing about are probably because their plans changed after--
--
Secretary Sebelius. Well, absolutely. And, again, in the
individual market, plans change every year.
Mr. Green. Yes.
Secretary Sebelius. Insurers design new products.
Mr. Green. Even in the small business market, that happens.
These plans are not allowed now because they're completely
inadequate; they don't offer the minimum essential benefits. Is
that correct.
Secretary Sebelius. That is correct.
Mr. Green. OK. And having been a State legislator, and I
know as Governor of Kansas, I assume every State has some type
of minimum mandated benefits that they have for their health
insurance plans.
Secretary Sebelius. They do, but it applies, again, sir, in
the past usually to the group markets, where 90 percent of
covered Americans get their policies. This market has always
been the Wild West.
Mr. Green. OK.
Secretary Sebelius. They didn't have protections.
Mr. Green. The Americans who received those letters from
their companies about cancellations, they're eligible to
purchase plans on the exchange?
Secretary Sebelius. Or out of the exchange. Individuals who
aren't interested in some kind of financial help can go outside
the exchange, inside the exchange. Their insurer can offer them
plans. They have choices they've never had before.
Mr. Green. And because of the benefits of the Affordable
Care Act, 80 percent of their premium dollar will come back to
them.
Secretary Sebelius. That's correct.
Mr. Green. OK.
Secretary Sebelius. That's correct.
Mr. Green. And that's not true. And I know it's not true in
Texas, but I don't know any States that have that 80 percent
requirement.
Secretary Sebelius. Well, no State had it, I would suggest,
in that kind of broad base prior to the Affordable Care Act. So
it's an 80/20----
Mr. Green. Let me give you an example of one of the plans I
found out during case work a few years ago. A large company
provided $25,000 maximum benefit for their employees in the
year. Most of employees didn't know about it, and--until this
one constituent found out that she had cancer, and the bill
ended up being $300,000. And so that's some of those plans that
are not being allowed to be sold now. Is that correct?
Secretary Sebelius. Well, not only would the plan have a
limit on out-of-pocket cost per year, it will have a limit on a
lifetime out-of-pocket cost, and it will take away the notion
that you would run out of your coverage in the middle of a
treatment, which a lot of plans do.
Mr. Green. I know I'm out of time, but it's like buying a
car. It may look good, but if it doesn't have a motor, it's no
good to have that car. So that's why the Affordable Care Act
has----
Secretary Sebelius. You save a lot of gas, but it doesn't
get you anywhere.
Mr. Upton. The gentleman's time has expired.
The gentleman from Oregon, Mr. Walden.
Mr. Walden. Thank you very much, Mr. Chairman.
Governor, Secretary, we're delighted to have you before the
committee. You and I both know how important this issue is to
all Americans that we get it right. So I hope you can
appreciate we're trying to understand what we missed along the
way, and one of the things that bothered me was the letter that
was sent from your agency to the GAO back in June 6th. And I'll
read in part, it said, ``We're in the final stages of
finalizing and testing the IT infrastructure that will support
the application enrollment process. HHS is extremely confident
that, on October 1, the marketplace will open on schedule and
millions of Americans will have access to affordable, quality
health insurance.''
I'm just an average guy from a small town in Oregon. When I
read that, it tells me you believed everything was good to go,
the testing was in place and we should have full confidence
everything would work. Correct?
Secretary Sebelius. That's the letter I signed, yes, sir.
Mr. Walden. Yes. Actually----
Secretary Sebelius. Or whoever.
Mr. Walden [continuing]. It was signed by your assistant.
Secretary Sebelius. Yes.
Mr. Walden. But----
Secretary Sebelius. Yes.
Mr. Walden [continuing]. The same point. And so I went into
this believing in your response, your agency's response to GAO
that things were ready to go, we should have full confidence,
because when somebody uses the word ``extremely confident,'' it
tells me you're extremely confident.
Second piece. Then when we had the testimony from the
witnesses last week, I asked them about the end-to-end testing
and what the industry standard would be, and they said it
really should have been months, especially for a project of
this magnitude, and yet we heard it was only 2 weeks. Now, in
August, GCI told CMS in their report----
Secretary Sebelius. CGI.
Mr. Walden. I'm sorry. CGI. Thank you. On August 9th, that
there was not enough time in the schedule to conduct adequate
performance testing. Did that make its way all the way to you,
and do you think there was adequate time?
Secretary Sebelius. Sir, clearly, as I've said before, we
did not adequately do end-to-end testing. The products were not
locked and loaded into the system until the third week in
September. Each of the component parts----
Mr. Walden. Right. They----
Secretary Sebelius [continuing]. Was tested----
Mr. Walden. They told us that.
Secretary Sebelius [continuing]. Validated, independently
validated----
Mr. Walden. And so all of those----
Secretary Sebelius [continuing]. But end-to-end----
Mr. Walden. I'm sorry. All those worked, though, right?
They told us last week that their individual modules were
tested and met specification. Do you concur with that analysis,
based on what you know?
Secretary Sebelius. I do concur with the testing that was
done, yes.
Mr. Walden. OK. So it really was the end-to-end, which is
why some of us thought we should delay until it could be done
right, to avoid this very collapse that now is upon us. And I
realize not everybody agreed to that.
The second piece here gets back to the Washington Post,
which I realize you haven't had, and I understand, a chance to
read this morning, but the four Pinocchios about the President
repeatedly saying if you have a plan, you will keep a plan. We
all heard that to mean, I've got a plan with a company, I'll
continue to have it even if they make minor changes, when in
fact your own rules as written said, no, that really isn't
what's going to happen. If minor changes are made, that means
the plan changed; that means you don't get it.
Secretary Sebelius. Well, sir, that isn't true. The rules
did not say what you just suggested. And I think the estimate
given that there would be turnover in the market was really an
outside projection. It wasn't our rules. It was a snapshot of
what happens in the market, that plans change so----
Mr. Walden. Sure.
Secretary Sebelius [continuing]. Dramatically----
Mr. Walden. Every year.
Secretary Sebelius [continuing]. Over time, that the
estimate was they wouldn't be--not because of our rules, but
because of insurance companies' business decisions----
Mr. Walden. Well, but you set up----
Secretary Sebelius [continuing]. Marketing plans.
Mr. Walden [continuing]. What those market rules looked
like they have to comply with, correct?
Secretary Sebelius. Only if they chose not to grandfather
the policy. That's the----
Mr. Walden. But that meant they couldn't make any changes.
Secretary Sebelius. Any grandfathered polices stayed in
place still would be in place----
Mr. Walden. Right. But not if they made----
Secretary Sebelius. None of these rules apply.
Mr. Walden. But if they made any change----
Secretary Sebelius. No. They could make changes in pricing.
They could make changes in benefits. They couldn't dramatically
disadvantage the consumer, but they could have trend lines.
They--they had a wide corridor to make sure that the--a similar
plan--so if a consumer liked the plan, the plan, if it stayed
in place----
Mr. Walden. So here's what--the practical implication, I've
got letters from constituents all over my district who have
gotten letters from their insurers who say because of
Obamacare, they're no longer going to be in the individual
market, or at least with that plan in the individual market.
And the result is this person from Cove, Oregon, said, I was
paying $600 a month for a $3,000 deductible. Now it costs me
$800 a month for a $5,000 deductible. I've got others here I'll
put in the record. A woman whose job, she had 40 hours, now
down to 29, neither has health insurance nor enough income to
live on her own because of the way this law is getting
implemented.
I realize my time's expired.
Mr. Upton. The gentlelady from Colorado, Ms. DeGette.
Ms. DeGette. Thank you very much, Mr. Chairman.
And thank you, Secretary, for being with us today.
I want to follow up on a couple of those questions that Mr.
Walden was asking you about CGI. As you know, Chairman Issa
last night released this document, a monthly project status
report from CGI last night. It looks to me it's sort of a
technical document that has a punch list of outstanding open
issues, and some of them do highlight items that upon first
read seem to be alarming. For example, one of the entries that,
due to the compressed schedule, there's not enough time built
in to allow for adequate performance testing. And this
certainly in retrospect sounds bad, but the day of the document
that Chairman Issa released is September 6th. And then, on
September 10th, 4 days later, CGI came in to this committee and
testified under oath, quote, ``CGI Federal is confident it will
deliver the functionality that CMS has directed.'' And we're--
we're trying to figure out, or at least I'm trying to figure
out how CGI is now coming in and saying, you know, we warned
everybody that this wasn't going to be ready, when they came in
and directly told me that they would be ready to launch on
October 1st.
So it kind of raises the question how these statements can
be reconciled. One explanation is that CGI was lying to this
committee. I think that's unlikely. Another is that CGI thought
that the items flagged in the report were like a punch list
that could be addressed.
So here's my question to you, Madam Secretary. Was CGI
telling your department the same thing that they told the
committee on September 10th, that the company was confident
that its programs would be ready?
Secretary Sebelius. Congresswoman, all of the contractors
testified here in September and again, I think, last week
before this committee, and the testimony was fairly similar,
that they were ready to go in September. They were asked in--
last week if they had suggested that we should delay the launch
date. Each of them said no. I think the chairman asked those
questions.
Ms. DeGette. So they never asked you to delay the launch
date?
Secretary Sebelius. They did not. And, frankly, I think it
is not valuable at this point----
Ms. DeGette. Right.
Secretary Sebelius [continuing]. To do a lot of pointing
blame, fixing the blame. What I want to do is fix the problem.
Ms. DeGette. And so do I.
Secretary Sebelius. I think we need the whole team to move
ahead----
Ms. DeGette. But----
Secretary Sebelius [continuing]. And we will report back
regularly.
Ms. DeGette. Right. But we're relying on these
contractors----
Secretary Sebelius. I understand.
Ms. DeGette [continuing]. To fix this. And so that goes to
my last question, which is, Mr. Zients has now come in, and he
says the site is going to be functional for the vast majority
of users by the end of November. Is that right?
Secretary Sebelius. That's correct.
Ms. DeGette. And given what CGI told us, and the other
vendors, do you believe that that is correct? Do you believe it
will be pretty much ready to go by the end of November?
Secretary Sebelius. I do. And I think that we are making
improvements each and every day. It is easier to use now than
it was 2 weeks ago. It is way from where we need it to be----
Ms. DeGette. So it's not like it's all going to be fine by
the end of November. It's beginning to improve already. Is that
your testimony?
Secretary Sebelius. It is a continuous process, as Web
sites are. Patches are made, fixes are made on an ongoing
basis.
Ms. DeGette. Thank you.
Secretary Sebelius. And as we find issues, like
Congresswoman Eshoo talked about, we are fixing them in real-
time.
Ms. DeGette. And you're going to guarantee, yes or no, that
people will have privacy when they go on this site?
Secretary Sebelius. Absolutely.
Ms. DeGette. Now, I just want to say one last thing. I was
on the Washington Journal program where callers call in this
morning, and I had a man, Max, call in, and he said he got one
of those letters from the insurance companies that his
insurance was cancelled, so what he did is he went onto the Web
site and he--under the Federal exchange, and he found a better
plan, and now he's going to sign up. So I would hope that
that's what everybody would be able to do.
And I thank you, Mr. Chairman.
Mr. Upton. Mr. Terry.
Mr. Terry. Thank you, Mr. Chairman.
And I'm pleased to hear that the Web site will be fully
operational by the end of November. And would you be able to--
would you come back to our committee so we could see if that's
actually accomplished and how it was accomplished?
Secretary Sebelius. I will make every effort to do that.
Mr. Terry. OK. You were Governor and State insurance
commissioner in Kansas. And I reached out to our State
insurance commissioner and Governor and found out that they
have absolutely no data about Nebraskans who have either tried
to enroll or enroll. As you know, Nebraska is one of the States
that opted not to do their own exchange and rely on the Federal
exchange. So it's interesting to me that neither our insurance
commissioner nor the Governor's office had any data about
Nebraskans and enrolling in these plans.
I also asked our insurance commissioner if they knew who
the navigators were and whether they had to apply to be
certified or licensed, in essence like an insurance agent would
be. And they told me they have no clue who's been authorized by
HHS to be a navigator and work with people in Nebraska. So this
is concerning to me, so I'm going to ask you a few questions
along this line.
First of all, do you have data on how many people in
general in the United States have tried to enroll in a plan
through this Web site?
Secretary Sebelius. No, sir. We do not have any reliable
data around enrollment, which is why we haven't given it to
date.
Mr. Terry. All right. Or have any data on how many people
have tried to enroll but, because of the problems, have not
been able to accomplish that?
Secretary Sebelius. No, sir. I can tell you I met with
insurers last week, and one of the priority fixes is the so-
called 834s, the document that----
Mr. Terry. OK.
Secretary Sebelius [continuing]. Sends an individual's
name----
Mr. Terry. The----
Secretary Sebelius [continuing]. To a company and verifies
it.
Mr. Terry. But----
Secretary Sebelius. That is one of the systems that is not
working.
Mr. Terry. I appreciate that. And the contractors I asked
specifically about the information of how many people have
tried to enroll and enroll, and they say that they do have
those numbers, but can't tell us that because of a contract
with HHS saying that they--they're gagged on that information.
Secretary Sebelius. I would suggest----
Mr. Terry. So could I----
Secretary Sebelius [continuing]. That the numbers are not
reliable according to the----
Mr. Terry. Well, I tell you what----
Secretary Sebelius [continuing]. Insurance agents and
according to us.
Mr. Terry. What my question is going to be, though, will
you, on the record right now, authorize them to give us those
numbers and let us determine whether those are reliable?
Secretary Sebelius. No, sir. I want to give you----
Mr. Terry. All right.
Secretary Sebelius [continuing]. Reliable, confirmed data
from every State and from the Federal marketplace. We have said
that we will do that on a monthly basis by the middle----
Mr. Terry. So----
Secretary Sebelius [continuing]. Of the month. You will
have that data, but I don't want to turn over anything that is
not confirmed and reliable, and that's what we'll do.
Mr. Terry. Well, but that data out there exists, and----
Secretary Sebelius. Sir, I would----
Mr. Terry [continuing]. You will not let us have it now.
Secretary Sebelius. I would tell you right now it is not
reliable data. According to the insurance companies who are
eager----
Mr. Terry. Well, the----
Secretary Sebelius [continuing]. To have customers, they
are not getting reliable data all the way through the system.
Mr. Terry [continuing]. Number of people----
Secretary Sebelius. It's one of the real problems that we
have.
Mr. Terry [continuing]. That have clicked on and tried to
get it or enrolled, I'm not asking about what they enrolled in
or whether they came in and said they were 65 and were quoted
something that they were 27 years old. That should be a pretty
reliable number just----
Secretary Sebelius. The system----
Mr. Terry [continuing]. On the surface, so would you----
Secretary Sebelius [continuing]. Isn't functioning, so we
are not getting that reliable data. Insurers----
Mr. Terry. All right.
Secretary Sebelius [continuing]. Who I met with said that
that is the case. We know that there's 700,000 applications
that have been----
Mr. Terry. The reliability of that data certainly flies in
the face of the testimony from the contractors.
All right. I yield back.
Mr. Upton. Ms. Capps.
Mrs. Capps. Thank you, Mr. Chairman. Thank you, Secretary
Sebelius, for your presence here today and your testimony.
While I, too, am frustrated with the flawed rollout of
HealthCare.gov, I do appreciate your longstanding commitment to
improving the health care options for all Americans and in
fixing this Web site quickly.
I think it's important to note that in my home State of
California and other States as well, the new exchange
marketplace, we call it Covered California, is working. And
rates, constituents are finding that rates are as much as 29
percent less than those that they found on the marketplace last
year. I'm thankful my constituents now have this option.
And as I look around to implementation nationwide, it seems
clear to me that political decisions in individual States have
really made the difference for consumers. The governors and
legislators, State legislators that embraced this law are
delivering for their communities, but those elected who are
trying to ignore the opportunities presented and continue to
throw up roadblocks both here in Congress and in State
legislators should not now seem surprised that there are
significant bumps along the way.
This seems to me to be completely disingenuous. Having
embraced the law since open enrollment began October 1st,
Californians have started nearly 180,000 applications, with
more beginning every day.
I know my time is limited, but I want to have a second to
mention a conversation I had just last night with a telephone
town hall to my district on the central coast of California.
One of the first callers I heard from was a mother from Santa
Barbara, her name's Meryl, and she wanted to tell me the story
of her son. Her son is 28 years old and he had been paying $425
a month for his insurance before the Affordable Care Act. She
was happy to report that he has already applied through Covered
California and has found a policy that works better for him and
has all the essential health benefits covered, which his former
policy did not, and now will only cost him $109 a month. This
is significant savings for Meryl's son, and this is a story
that's being repeated at least in California often.
So there are millions of residents in many States who have
now set up their own Web sites and marketplaces. In those
States, tens of thousands of people are now as we speak signing
up for coverage, and this is demonstrating that the Affordable
Care Act is working.
In New York and Washington, over 30,000 people have
enrolled; in Oregon, over 50,000 people have been enrolled;
Kentucky, 31,000 people have been enrolled. We could go on and
on. The success of the State exchanges, which is where this is
meant to be implemented, shows how badly this law is wanted and
needed, how much it will be of help to so many people who want
quality, affordable health care.
So my three quick questions to you are this, Madam Speaker:
What is your assessment of how this first month has gone in the
States that are running their own marketplaces, which this
Congress intended that the Affordable Care Act work?
Secretary Sebelius. Well, everything we hear from the
State-based markets is that they are doing well. They have not
submitted data yet. We, again, are working with them around a
monthly schedule so that they will confirm Medicaid data and
enrollment data, and we'll see the real numbers at the end of
the month and make sure that the--they're available to the
public, but everything we hear is that they see the same
demand, they are eager to enroll folks, and that that is going
smoothly.
Mrs. Capps. And what do you think this success shows about
the demand and the interest for affordable health insurance on
the part of constituents?
Secretary Sebelius. Well, I don't think there's any
question that in spite of a series of roadblocks and blockades
and a lot of misinformation driven by about a $400 million
marketing campaign last year, Americans are eager to see what
their benefits may be under the law, what their opportunities
are, how to get health security for themselves and their
families. And we want to make sure that they see those
benefits. The Web site is one of the ways to do that. The call
center, on-the-ground enrollment, personal outreach are a
variety of ways.
And I would tell your colleague, Mr. Congressman, I'd be
happy to get you the list of the Nebraska folks who are on the
ground. It's available easily. It's public record. So I'd be
happy to send it to you so you can share it with your insurance
commissioner and governor.
Mr. Terry. Thank you.
Mr. Upton. The gentlelady's time is expired. The gentleman
from the great State of Michigan, Mr. Rogers.
Mr. Rogers. Thank you. I thank you, Madam Secretary, for
being here. A short time, I'll get through some questions here
if I can.
Is it your testimony that every night to try to increase
the functionality of the system, you're hot swapping codes? So
my understanding is that between 2 and 4, write new code, put
it into the system. Yes or no?
Secretary Sebelius. Clearly I am not hot swapping code.
There is a----
Mr. Rogers. No, no.
Secretary Sebelius [continuing]. Technical team that
periodically----
Mr. Rogers. You're in charge of the operation that hot
swaps code on functionality. You're trying to improve the
functionality. Yes?
Secretary Sebelius. Yes.
Mr. Rogers. So that happens every night. Yes?
Secretary Sebelius. No. I don't think it does happen every
night. It happens periodically during the hours of 1:00 and
5:00, but it is not a nightly feature.
Mr. Rogers. Great. Has each piece of that code that's been
introduced into the system been security tested?
Secretary Sebelius. That's my understanding, yes, sir. And
the----
Mr. Rogers. Each----
Secretary Sebelius [continuing]. Testing----
Mr. Rogers. Each piece of that code has been tested. Yes or
no?
Secretary Sebelius. I could not--I don't know----
Mr. Rogers. OK. That's a----
Secretary Sebelius [continuing]. But I can tell you that
security----
Mr. Rogers. That's a much safer answer, trust me.
Secretary Sebelius [continuing]. Is an ongoing operation,
that as code is loaded, you need to retest over and over and
over again. So whether it's pre-tested, I can't tell you.
Mr. Rogers. All right.
Secretary Sebelius. I know----
Mr. Rogers. You need to pre-test the code.
Secretary Sebelius [continuing]. It is simultaneous----
Mr. Rogers. Has any end-to-end security tests been
conducted since HealthCare.gov went live on October 1st, yes or
no?
Secretary Sebelius. My understanding is there is continuous
testing as the temporary authority to operate calls for.
Mr. Rogers. Yes or no, has an end-to-end security test been
conducted since HealthCare.gov went live, yes or no?
Secretary Sebelius. I will find out exactly what testing
they're doing. I know they're doing simultaneous testing as new
code is loaded.
Mr. Rogers. Are there any end-to-end security tests run
after every new piece of code is put in--I'm not talking about
testing the code now. I'm talking about an end-to-end security
test----
Secretary Sebelius. I can tell you how----
Mr. Rogers [continuing]. That covers across the boundaries.
Secretary Sebelius [continuing]. Frequently it's done----
Mr. Rogers. Well, I can tell----
Secretary Sebelius [continuing]. But I will get you that
information from my techs.
Mr. Rogers. I can tell you they're not, and I'd be
interested to hear why not.
If you'd go to Tab 2 quickly in your book, I'm going to
read three things----
Secretary Sebelius. I'm sorry. What book, sir?
Mr. Rogers. You have to tab there that if you go toTab 2,
right there--well, while you're looking, I'll read. It's dated
September 27th and it is to Marilyn Tavenner. Let me just read
a couple of pieces here. There are inherent security risks with
not having all code tested in a single environment. Finally,
the system requires rapid development and release of hot fixes
and patches, so it is not always available or stable during the
duration of the testing.
Secondly, the security contractor has not been able to test
all of the security controls in one complete version of the
system.
And if you look in the first part, which is most troubling
of all, it says, due to system readiness issues, the security
control assessment was only partly completed. This constitutes
a risk that must be accepted before the marketplace day one
operations.
And so let me tell you what you did. You allowed the system
to go forward with no encryption on backup systems. They had no
encryption on certain boundary crossings. You accepted a risk
on behalf of every user of this computer that put their
personal financial information at risk because you did not even
have the most basic end-to-end tests on security of this
system.
Amazon would never do this, ProFlowers would never do this,
Kayak would never do this. This is completely an unacceptable
level of security. And here's the scary part: We found out
after the contractors last week that an end-to-end test hadn't
been conducted on security, not functionality, because if it's
not functioning, it's not secure. You are ongoing hot patches
without end-to-end tests. The private contractors told us it
would take a very thorough 2 months just for an integrated end-
to-end security test that I'll tell you has not happened today.
Why? Because you're constantly adding new code every night to
protect the functionality of the system. You have exposed
millions of Americans because you all, according to your memo,
believed it was an acceptable risk. Don't you think you had the
obligation to tell the American people that we're going to put
you in the system, but beware, your information is likely to be
vulnerable? Would you commit today, Secretary, to shut down the
system and give an end-to-end security test so that these
Americans----
Secretary Sebelius. No, sir.
Mr. Rogers [continuing]. Could have their information?
Secretary Sebelius. If you read the memo----
Mr. Rogers. Oh, I have read it.
Secretary Sebelius [continuing]. It goes on to say that
weekly testing of our Brda devices, including interface
testing, daily, weekly scans are going on. This is a temporary
authority----
Mr. Rogers. Candidly, that's not what the memo says----
Secretary Sebelius [continuing]. A temporary----
Mr. Rogers [continuing]. Number one----
Secretary Sebelius. It does.
Mr. Rogers [continuing]. And number two, the contractors
will tell you this is----
Mr. Waxman. Mr. Chairman, a point of order.
Mr. Upton. The gentleman----
Mr. Waxman. I think the witness ought to be allowed to
answer what was a speech by the colleague, because he's raised
a lot of issues.
Mr. Upton. If the gentlelady will answer, we'll move----
Mr. Rogers. You mean there's----
Mr. Upton [continuing]. We'll move----
Mr. Rogers [continuing]. Giving speeches here today? That's
shocking.
Mr. Upton. Does the Secretary wish to respond briefly?
Secretary Sebelius. Sir, I would just say this document is
a document signed by Administrator Tavenner which discusses
mitigation strategies for security that are ongoing and
upgraded, and an authorization to operate on a permanent basis
will not be signed until these mitigation strategies are
satisfied. It is underway right now, but daily and weekly
monitoring and testing is underway.
Mr. Rogers. Mr. Chairman, there are people using this
system today, and she's just admitted again the system isn't
secure nor has it been----
Secretary Sebelius. I did not say that, sir.
Mr. Waxman. Mr. Chairman, she didn't admit that. You said
it, but she didn't say it.
Mr. Upton. Gentleman's time is expired, Mr. Doyle.
Mr. Doyle. Thank you, Mr. Chairman. Madam Secretary,
welcome. Those of us who fought for this law, who voted for
this law have a vested interest in its success, and the
concerns that you hear expressed on this side of the panel are
real, because we want to see Americans get health care. I think
it's somewhat disingenuous for my colleagues on the other side
of the podium here to have this faux anger and this faux
concern over a bill that they absolutely want to fail and have
rooted for its failure and have voted over 40-some times to
repeal this bill, never putting an alternative plan on the
floor for the American people, but just to simply say they want
to make sure this plan doesn't succeed.
And I think their real fear is that the plan will succeed
and the American people will learn of the real benefits of this
plan, not the propaganda campaign that's gone on by the
Republicans for the last 3 years.
Madam Secretary, I think one of the keys to the success of
this plan is that we get young people to enroll in this plan,
and I have some questions about some enrollment concerns. Now,
I understand that you've said approximately 700,000 people have
applied for coverage via the HealthCare.gov and the State
exchanges. Is that----
Secretary Sebelius. They've completed an application.
Mr. Doyle. Right. Which is different from enrollment.
Secretary Sebelius. That's correct.
Mr. Doyle. So my question is, are you expecting--I know you
don't have exact numbers yet, but are you expecting a large
number or a small number of enrollments during the first month?
What are your thoughts on that?
Secretary Sebelius. Well, our projections prior to launch
were always that there would be a very small number at the
beginning. We watched the Massachusetts trend, which started
slowly and built. I think there's no question that given our
flawed launch of HealthCare.gov, it will be a very small
number.
Mr. Doyle. Yes. I mean, in the Massachusetts plan, I think
the first month, it was 123 people signed up, less than 1
percent of the overall first year enrollment in that first
month. And we saw the same kind of numbers in Medicare Part D
the first month of open enrollment back in 2006.
Madam Secretary, young Americans are the most likely age
group to be uninsured, and a lot of us are concerned that
because of the problems that we've been having with the Web
site, that a lot of these young folks may not come back on. You
know, they have very short attention spans. I've got four kids
that all work on the Internet, and if they can't get something
in 5 minutes, they're on to something else.
What do we do and what plans are in place by your
department to encourage young people to go back and revisit
that site and to make sure that we're getting young people
looking at that site and accessing it?
Secretary Sebelius. Well, step number one is fix the site,
because we don't want people to be invited back and then have a
bad experience a second time around. I think that's absolutely
right. The site is particularly important to tech savvy younger
generation folks, who we need to enroll. I think that we have--
so fixing the site is step one, and step number two is getting
information to folks that the law even exists. A lot of young
people haven't followed this dialogue for the last 3-\1/2\
years or been paying attention----
Mr. Doyle. Yes. I think we need a real----
Secretary Sebelius [continuing]. And think they don't need
health insurance.
Mr. Doyle [continuing]. A real marketing campaign and we
need to really reach out to----
Secretary Sebelius. Yes.
Mr. Doyle [continuing]. Young people----
Secretary Sebelius. We intend to do that.
Mr. Doyle [continuing]. Especially at the end of November,
when you say this site is going to be working a lot better, to
make sure they're checking that site out.
Secretary Sebelius. You bet.
Mr. Doyle. One of my four kids is self-employed. He's 33
years old. He's paying about $140 a month right now for a Blue
Cross plan. He's eligible for a subsidy. We browsed that site.
He's going to be able to get coverage for about half of what
he's paying right now. And that's good news for us, because I
think my wife is paying his premiums, so I think we're going to
save the money.
Secretary Sebelius. Well, I would----
Mr. Doyle. But I think it's important--we had to prod him
to go on that site and enroll. And I think for a lot of young
people, they're not going to do it unless it's easy, so it's
important we get that fixed. Thank you.
Secretary Sebelius. I agree.
Mr. Upton. Dr. Murphy, chairman of the Oversight
Subcommittee.
Mr. Murphy. Thank you, Madam Secretary, and welcome. You
had mentioned that the people who did technology on the Web
site made a number of mistakes. You mentioned Verizon. When we
had them before our committee last week, they said it wasn't
their fault, they were told, but then HHS, there were some
problems there.
Secretary Sebelius. Sir, Verizon wasn't involved in the Web
site.
Mr. Murphy. I----
Secretary Sebelius. Verizon hosts the cloud.
Mr. Murphy. Right. With the data.
Secretary Sebelius. I just need to clear that up.
Mr. Murphy. I understand that.
Secretary Sebelius. They were--not the Web site.
Mr. Murphy. But they had a role, CGI had a role, over
companies, et cetera. I'm just curious in this process, what
decisions did you make that affected this, for better or worse,
in terms of the data, the ease or problems with the moment and
being able to track how many people are actually enrolled?
Secretary Sebelius. My decisions, specifically to design
the Web site, I was not involved. I am prohibited to choose
contractors. We go by the----
Mr. Murphy. OK.
Secretary Sebelius [continuing]. Federal procurement, and I
got regular reports on exactly what was done and how it was----
Mr. Murphy. What about the part with regard to getting data
in terms of how many are people even enrolled or trying to
enroll? Did you have any decisions in that process?
Secretary Sebelius. Again, the application process at this
point does not work end-to-end very well----
Mr. Murphy. Right. I understand it doesn't work. That's
obvious.
Secretary Sebelius [continuing]. And we do not have
reliable data about the end----
Mr. Murphy. I'm just trying to find out if you had asked
them to say, look, I'm in charge of this. I'm going to want a
regular report. How many people have tried to enroll, how many
people have enrolled. Have you--did you ask that question in
the plan?
Secretary Sebelius. We have prioritized for our contractors
that specific fix. And believe me, the insurance companies are
eager for us to get reliable data to make sure----
Mr. Murphy. I'm just trying to----
Secretary Sebelius [continuing]. That their data matches
ours, and that is not there yet.
Mr. Murphy. I appreciate that. I'm just trying to find out
if you've told them that was part of the plan and what they're
doing.
Real quick. We're hearing from thousands of people who have
had their policies cancelled. In fact, I heard from one insurer
in Pittsburgh that just cancelled 30,000 individual policies.
Now, they said they expect 50,000 to 30,000 to enroll in the
exchange plans. Just so you know, to date so far the number of
people who have signed up for their plan is 10, 10.
Now, I'm concerned a lot of these individuals and their
families aren't going to be make it by January 1, so I'm
wondering, do you know how many families will not have been
able to keep their insurance by January 1? Do you have any
matrix that can help you understand what that number's going to
be?
Secretary Sebelius. Sir, by law that has been in place for
a while at the State level, insurance companies must give their
customers a 90-day notice about a policy change----
Mr. Murphy. Right.
Secretary Sebelius [continuing]. Or a plan cancellation, 90
days.
Mr. Murphy. I'm just wondering if you have a mechanism
whereby you will know. Is something built into the system
whereby you be----
Secretary Sebelius. Will I know if your constituent signed
up for an individual plan? No.
Mr. Murphy. People across America. And do we know how many
policies will be cancelled or be enrolled? I mean, is it 1,000?
10,000? 1 million? 5 million? Do we know?
Secretary Sebelius. We know that in the individual market,
a number of the plans being sold are not grandfathered and are
not currently meeting the law. Those notices have gone out. We
know that there are about 12 million people in the individual
market. A number of them have grandfathered plans, a number of
them have plans which meet the essential health benefits. So I
can try to get those numbers.
Mr. Murphy. Well, let me put a face on that. A person named
Paul wrote to me and says, I'm supposedly one of the families
that this act was supposed to help, but it's in fact hurting
more, would make it harder for my family to live. We will have
less money for food and other essential items. I have a wife
and four children to take care of. Another person wrote, I had
a 2013 plan, which if you include the premiums and out-of-
pocket, total liability was $5,300. For 2014, the same program
liability is $9,000. Single mom writes, I want to convey I'm
one of the millions of people who's having their health
insurance cancelled because it does not meet the standards of
Obamacare. I liked my insurance. I especially liked the price,
and now I'm being forced to sign up for something that will be
way more expensive. As a single mom who is self-employed, I'm
worried about how I'm going to pay my bills.
I hope you have a mechanism to track who these people are,
that she's not eligible for other subsidies, but the costs are
really going to be driving her down.
Secretary Sebelius. Well, sir, again, I would suggest that
there is no requirement that any of those consumers sign up for
a plan suggested by their company at a higher price. They have
now options----
Mr. Murphy. But if a plan changes----
Secretary Sebelius [continuing]. Without health
underwriting, without pre-existing conditions, with some
guarantees around how much out-of-pocket costs that----
Mr. Murphy. She's searching around, and she can't find a
plan she can afford.
Secretary Sebelius [continuing]. They never had before.
Mr. Murphy. She can't find a plan she can afford.
Mr. Upton. The gentleman's time is expired. The gentleman
from North Carolina, Mr. Butterfield.
Mr. Butterfield. Mr. Chairman, before my time begins, I
have a parliamentary inquiry.
Mr. Upton. Yes. Go ahead.
Mr. Butterfield. Mr. Chairman, I'm always sensitive to
committee decorum, and before I do it this morning, I want to
ask unanimous consent that I be allowed to display the
Democratic Twitter handle.
Mr. Upton. Go right ahead.
Mr. Butterfield. Hearing no objection. Thank you.
Secretary Sebelius, thank you so very much for coming
today. I would like to ask you about the document that my
Republican colleagues have just released. This document is an
authority to operate memorandum, to operate the federally-
facilitated marketplace for 6 months and implement a security
mitigation plan. This document, as I understand it, describes
security testing for HealthCare.gov. It says that security
testing of the marketplace was ongoing since its inception and
into September of this year. In fact, it says that, quote,
throughout the three rounds of security control assessment
testing, all of the security controls have been tested on
different versions of the system.
That's good news, but the bad news is that it goes on to
say that because of system readiness, a complete security
assessment of all the security controls in one complete version
of the system were not tested.
This document indicates that CMS postponed a final security
assessment screening, but in its place, CMS did put in place a
number of mitigation measures, and it concluded that these
measures would mitigate any security risk.
Question: Are you familiar with this document?
Secretary Sebelius. Yes, sir.
Mr. Butterfield. Is it correct that this document
recommends implementing a dedicated security team to monitor,
track, and ensure the mitigation plan activities are completed?
Secretary Sebelius. Yes, it does.
Mr. Butterfield. Now, is it correct that this document
recommends monitoring and performing weekly testing on all
border devices, including Internet-facing Web servers?
Secretary Sebelius. More than recommended. It's underway.
Mr. Butterfield. Is it correct that this document
recommends conducting daily and weekly scans?
Secretary Sebelius. Yes, sir.
Mr. Butterfield. Does this document recommend conducting a
full SCA test on the marketplace in a stable environment?
Secretary Sebelius. Yes, sir.
Mr. Butterfield. Is it correct that this document
recommends migrating the marketplace to CMS's virtual data
center environment in the first quarter of next year?
Secretary Sebelius. Yes, it does.
Mr. Butterfield. My understanding is that an independent
security expert, the MITRE Corporation, is performing security
testing on the code that powers the Web site on an ongoing
basis. Is that correct?
Secretary Sebelius. That is correct. And MITRE did an
assessment of the system, gave us a preliminary report. They
are in the process of posting their final report. That did not
raise flags about going ahead, and the mitigation strategy was
put in place to make sure that we had a temporary authority to
operate in place while the mitigation was going on, and then a
permanent authority to operate will be signed.
Mr. Butterfield. Finally, do you have confidence in these
and other measures you are taking to protect the security of
Americans' personal information?
Secretary Sebelius. I do, sir.
Mr. Butterfield. Thank you. This is the third time you said
it during the hearing, and we believe you. Thank you.
What you're telling us is that these remedial actions and
the ongoing security testing from MITRE are protecting the
security of the Web site. That's a message that is important
for the public to hear. My Republican colleagues do not want
this Web site to work. I am convinced of that. They want to
block the ACA at all costs and even shut down the government to
stop the law.
For the last 4 years, they have taken every glitch, every
simple glitch and hiccup in the law and tried to exaggerate its
significance, and that's happening today and it's so
disappointing.
Thank you, Mr. Chairman. I yield back.
Mr. Upton. Dr. Burgess.
Mr. Burgess. Mr. Chairman, I wonder if I might make a
unanimous consent request also.
Mr. Upton. Yes. Go ahead.
Mr. Burgess. I would like to request unanimous consent that
my opening statement, which we were not allowed to give could
be made part of the record for this hearing.
Mr. Upton. No. Without objection.
Mr. Burgess. And further, I do have a number of questions.
Many have come from constituents. I'd also like to be able to
submit those as questions for the record.
Mr. Upton. Without objection.
[The prepared statement of Mr. Burgess follows:]
Prepared statement of Hon. Michael C. Burgess
The Affordable Care Act is quickly becoming the poster
child for the failure of big government. It's a stunning train
wreck that is coming down the tracks toward us.
Since the law was passed in 2010 this Committee has
repeatedly questioned the officials from the Department of
Health and Human Services (HHS), the Center for Medicare and
Medicaid Services (CMS), the Treasury Department, and the White
House. I was told, time and time again, by all of these
officials that the ACA would ``definitely'' be ready to go live
on October 1, 2013.
On February 16, 2011, the former director of the Center for
Consumer Information and Insurance Oversight (CCIIO), Mr. Steve
Larsen, assured me everything would work on Day 1:
Mr. (Burgess.) You are betting on all this stuff working.
Mr. (Larsen.) I think we are going to flip the switch and
the lights are going to go on.
On April 18, 2013, Kathleen Sebelius, Secretary of Health
and Human Services, sat before the Energy and Commerce
Committee and told me:
Dr. (Burgess.) They are to go live online on October 1st.
And I guess the question on everyone's mind this morning is,
will you be ready?
Secretary (Sebelius.) Yes, sir, and the exchanges----
Dr. (Burgess.) I will take that as a yes.
Secretary (Sebelius.) Open enrollment will start October
1st. The exchanges will be up and running on January 1st.
Dr. (Burgess.) Are you talking about work around plans?
Secretary (Sebelius.) No, we are not. We are moving ahead.
We have the federal hub on track and on time. We are moving
ahead with the marketplaces that we will be individually
responsible for and we're working very closely with our state
partners on their plans and their time table for the state
based marketplaces.
Dr. (Burgess.) So the federal hub will be
available?Secretary (Sebelius) Yes.
The following week, on April 24, 2013, Gary Cohen, the
current director of CCIIO, testified before theEnergy and
Commerce Committee:
Dr. (Burgess.) The Secretary was here last week and I asked
her about contingency plans and she said there are no
contingency plans. Everything will be ready. So which is it?
Everything will be ready or you are planning for contingencies?
Mr. (Cohen.) Everything will be ready but we are also
planning for anything that, when we go into operation, if the
situations come up that we need to address, we will be ready to
address those situations and make sure that the experience for
American consumers is as seamless and as good as it can be.
On August 1, 2013, Marilyn Tavenner, the current CMS
Administrator, testified before the Energy and Commerce
Committee:
Dr. (Burgess) When can Texans expect to go online and be
able to get information about how expensive coverage will be in
the exchange?
(Ms. Tavenner.) So the information about what is available
in the exchange will be available to them October 1.
And just a little over one month ago, on September 19,
2013, days before the Exchanges were scheduled to go live, Gary
Cohen, CCIIO Director, testified before the Energy and Commerce
Committee again:
Dr. (Burgess) Will the enrollment process be ready October
1 of this year?
Mr. (Cohen.) Consumers will be able to go online, they will
be able to get a determination of what tax subsidies they are
eligible for, they will be able to look at the plans that are
available where they live, they will be able to see the premium
net of subsidy that they would have to pay, and they will be
able to choose a plan and get enrolled in coverage beginning
October 1.
Yet, here we are, 30 days after October 1 and the American
people are still waiting to see a fullyfunctional law. The
failures of the healthcare.gov Web site are just the beginning
of the dysfunction that is to come as the implementation of
President's signature law moves forward into 2014. After
spending hundreds of millions of dollars the American people
deserve some concrete answers and not empty political
posturing.
In addition to the hearings this Committee held to question
Administration officials, I had private meetings with Jay
Angoff, former CCIIO director and later senior adviser to
Sebelius; Nancy Deparle, former Director of WH Office of Health
Reform; Henry Chao, Deputy Chief Information Officer; and Steve
Larsen, former CCIIO director. It seems I was having the
meetings the Secretary was supposed to be having.
Despite the array of public and private meetings with
officials from the range of agencies involved in implementing
the President's health care law, I still do not have the
answers to questions about the law's basic functionality. At
this point, I'm not even sure who is in charge of this program
because no one knows what is going on. Unless someone is
willing to admit that there are problems, how can we ever hope
to fix it?
# # #
Mr. Burgess. And ask the Secretary for her attention to
those so we could get answers, because they, after all, are
important questions. OK. Thank you, Mr. Chairman.
It just came to my attention that on CNN's Web site, that
the site was hacked just last week. And I will be happy to make
this available to you. I don't think the----
Secretary Sebelius. The CNN Web site?
Mr. Burgess. CNN ran a story that the HealthCare.gov Web
site was hacked last week. And, again, I will get this to you,
and would appreciate your response to that.
Mr. Terry had asked a question about he wanted to get the
information about the number of people who had signed up. You
said you wouldn't provide that, because it wasn't accurate.
Would you provide us with the number of people who have been
able to enroll on the telephone? The President gave an 800
number during his speech. Could we get a number of people who
have enrolled on the telephone?
Secretary Sebelius. No, sir. We do not have reliable
enrollment data. We will have that to you by the middle of
November, as we committed to. We are collecting State data, we
are collecting telephone data, we are collecting paper data, we
are collecting Web site data. We want it to be reliable----
Mr. Burgess. OK.
Secretary Sebelius [continuing]. And accountable, and
that's what we will have.
Mr. Burgess. Reclaiming my time. The telephone data doesn't
seem that it would be that difficult to compile since the
number is likely quite low. Now----
Secretary Sebelius. The telephone goes through the system,
sir.
Dr. Burgess [continuing]. You have, or the President
designated a, I call him a glitch czar, Jeffery Zients. And
you're familiar it was his appointment to oversee----
Secretary Sebelius. I asked him to serve in this capacity,
yes, sir.
Mr. Burgess. Many of us on the Subcommittee of Oversight
Investigations in Energy and Commerce were not as comforted as
you by that selection, because if you will recall, Mr. Zients'
history with this subcommittee it not great. He was involved
with Solyndra. We asked him to come and talk to us about
Solyndra in 2011. He refused, requiring a subpoena to be issued
by this subcommittee.
Will you commit to making Mr. Zients available to our
subcommittee for our questions?
Secretary Sebelius. Congressman, you are welcome to ask Mr.
Zients to come before the committee. He is volunteering his
services to us for a period of time. He has been appointed by
the president to start in January as the head of the National
Economic Council. He was the deputy director at OMB for
management and performance. I am thrilled that he is willing to
take on this assignment and help us drive the management, but--
--
Mr. Burgess. Again, his appearance here will be important.
Now, a lot of people are asking if the President's words
leading up to this law, if they matter. And the statement in
The Washington Post today edited the President's statement to
say, if you like your health care plan, you will be able to
keep your health care plan if we deem it adequate. That seems
like a more operational statement, and especially if you go
back just a few years into the Federal Register, and I'm
quoting here from the Federal Register from July 23rd of 2010,
just a few months after the law was signed, the interim rule
for dealing with the grandfathering written into the Federal
record, because newly-purchased individual policies are not
grandfathered, the Department expects that a large population
of individual policies will not be grandfathered, covering up
to and perhaps exceeding 10 million people.
I hope the President was apprised of that before he made
these statements, because clearly his statement wasn't
operational.
Secretary Sebelius. Again, that's an insurance company
choice. And that was a snapshot----
Mr. Burgess. But----
Secretary Sebelius [continuing]. Of what the market looks
like.
Dr. Burgess [continuing]. Your----
Secretary Sebelius. The President made it clear, and our
policy was to put----
Mr. Burgess. In----
Secretary Sebelius [continuing]. A grandfather clause in
both employer-based coverage and in----
Mr. Burgess. Right. But in the----
Secretary Sebelius [continuing]. Individual coverage.
Mr. Burgess. [continuing]. Federal Register, those were the
comments that were recorded. Now, I do have to----
Secretary Sebelius. No. This isn't a government takeover of
anything. These are private insurance plans----
Mr. Burgess. I do have to ask you this.
Secretary Sebelius [continuing]. Making private decisions.
Mr. Burgess. I do have to ask you this: You serve at the
pleasure of the President, we're all aware of that, but we have
had many of your employees here in front of this committee, and
you do have to ask yourself, are they just being purposely
misleading, or are they really not that smart? So I'm going to
ask you this morning, for the sake of the future of health care
in this country, will you please ask for the resignation of
Gary Cohen, because he's repeatedly come to this committee and
misled us?
Secretary Sebelius. I will not, sir.
Mr. Upton. The gentleman's time has expired.
Mr. Waxman. Mr. Chairman, a point of personal privilege. I
just think the record ought to be clear about Jeffrey Zients.
He was invited with less than a week's notice to come before
this committee. He couldn't make it that day. He asked for some
other day. He went to OMB and had nothing to do with the
Solyndra contract, and he did come before us and talk about it,
but his sole role was to represent OMB. And I don't think he
ought to have any--there ought to be any disparagement of
Jeffrey Zients. He's a very well-regarded public servant.
Mr. Upton. The gentleman's statement will stand. Ms.
Matsui.
Ms. Matsui. Thank you, Mr. Chairman. Welcome, Madam
Secretary. Now, we all agree the Web site problems must be
resolved, as this country invented and developed the Internet
and the concept of the Web sites, so there are high
expectations. The fact that the hired private contractors could
not build a ready Web site in nearly 3 years is inexcusable,
and after its fix, I hope the administration will hold those at
fault accountable, but we can't lose sight of the big picture
that when this is all said and done, every American will have
affordable quality health insurance and health care. This is
the goal, I believe, of all Democrats and Republicans.
The ACA's working in California, and it's working in my
district in Sacramento, and I just want to tell you about a
letter I got from a constituent:
``Dear Congresswoman Matsui, as a self-employed contract
employee, I've had individually purchased health insurance for
11 years now, insurance that has gone up every year, sometimes
more than once; insurance that wouldn't let me add my daughter
when my ex-husband stopped his insurance policy that covered
them both; insurance that I have underused for fear they would
drop me; insurance that has just dropped me anyway because they
decided they will no longer offer individual plans. This could
have happened to me at any time. I'm so grateful the Affordable
Care Act provisions make it possible to get health insurance
beginning in January for me and my daughter.
``As all this is happening, I have finished graduate school
and started my own business. Slowly but surely, things are
happening, and I expect to be hiring my first employees in the
next 6 months. The provisions of the ACA are helping me in
this, too. I can clearly see what it would cost me to provide
health benefits for my future employees, understand these costs
and build my business plan accordingly.'' And that is just one
of the letters I received.
Now, I've also heard from my colleagues on the other side
of the aisle complain again and again about how health care
reform is increasing health care costs, but the empirical
evidence shows something quite different. The recent trends in
Medicare spending growth are really quite remarkable. Medicare
spending growth is at historically low levels, growing by less
than one half of 1 percent in fiscal year 2012, following slow
growth in 2010 and 2011. The same is true on the private side
of health care. Personal consumption expenditures on health
care, everything from health insurance, to drugs, to hospital
care rose by just over 1 percent in the past year. This is the
slowest increase in nearly 50 years.
Madam Secretary, what does this data tell us about what has
happened to health care costs since the ACA became law?
Secretary Sebelius. Well, Congresswoman, you're absolutely
right. In the last 3-\1/2\ years since the President signed the
Affordable Care Act, we have seen a great slowdown in the
extraordinary cost increases year in and year out for health
care, in the Medicare plan, in the Medicaid plan, in private
insurance, and in underlying healthcare costs, which affect
every American. Some of that is to do with some of the features
that are currently in place around different care delivery and
different payment systems that we are helping to drive, given
the tools that we have, with the Affordable Care Act: more
quality outcomes, trying to prevent hospital readmissions,
looking at hospital-acquired infections, medical homes that
prevent people in the first place or help them stay healthy in
their own homes and in their own places.
Ms. Matsui. So it's true that the private insurance costs
are growing at the slowest rate in decades also; is that true?
Secretary Sebelius. That is true.
Ms. Matsui. Am I also correct that ACA premiums are coming
in even lower than predicted by experts like the CBO?
Secretary Sebelius. Well, they're on average about 16
percent lower than was estimated that those premiums would be.
And that's the premium, not accounting for the number of
uninsured or underinsured Americans who will then qualify for
financial help. Since they don't have employer coverage, they
get some help from the taxpayers paying for that coverage.
Ms. Matsui. Thank you, Madam Secretary.
Mr. Upton. Dr. Gingrey.
Mr. Gingrey. Thank you, Mr. Chairman.
Madam Secretary, when you spoke at the Democratic National
Convention in Charlotte last September, one of the first
statements you made about the Affordable Care Act was, quote,
``But for us Democrats, Obamacare is a badge of honor, because
no matter who you are, what stage of life you're in, this law
is a good thing. First, if you already have insurance you like,
you can keep it.'' And I end the quote.
I'd call this a red hearing that misled voters, intentional
or not. Now, perhaps had you known that millions would lose
their coverage, families would face financial disaster, as one
constituent recently told me, or that the exchange rollout
would be plagued by a multitude--multiple delays we've seen,
you would not consider it such a badge of honor.
The fact is your words and those of the President as he
campaigned last year that ``if you already have insurance you
like, you can keep it'' seems to be directly refuted by the
millions of cancellation notices already sent to Americans just
in the past few weeks. Whether your statement was inaccurate,
or, as Mr. Hoyer said yesterday, not precise enough, it does
strike me that millions of individuals who, by listening to
speeches like yours, voted believing one thing now find
themselves without coverage and are now scrambling to find
coverage in a marketplace that offers more expensive plans with
fewer options.
In response to my constituents' calls for help, I created a
portal on my Web site--no patches or fixes needed--that allows
those who have experienced problems to reach out and tell me
about their personal experiences. In just the last few days, my
office has received dozens of complaints regarding increases in
their monthly premiums. I received one such notice from a
mother in her early fifties, who just received a notice that
not only will her insurance premium double, but she will also
have to switch insurers to keep her doctors due to the effect
of the Affordable Care Act.
Can you imagine receiving notices like this? I can tell you
that just in my district, the 11th of Georgia, many more are
experiencing this situation. Madam Secretary, this is akin to
telling seniors that in a few weeks their Medicare coverage
will be dropped, or their premiums would double. Now, I know
that neither you nor the administration would ever advocate for
such a policy, yet here you are subjecting those currently in
the individual market to such government intervention. And I
would hope that you would agree with me in recognizing that
these increases are a heavy hardship on my constituents, on all
of our constituents, Republicans or Democrats.
Now I'll get to my questions. You know the healthcare law
included a hardship exemption from the individual mandate, yet
the administration has failed to finalize the application form
for the hardship exemption 3-\1/2\ years after we passed this
law. As of today can an individual apply for a hardship
exemption from the individual mandate on HealthCare.gov, yes or
no?
Secretary Sebelius. I don't know----
Mr. Gingrey. I do. It's no.
On October 15, Politico reported that if the online system
for getting into Obamacare coverage is rickety, the system for
getting out of the mandate doesn't even exist yet. HHS says it
will take another month at least for the administration to
finalize the forms for the hardship exemption from the
individual mandate.
Why has it taken 3-\1/2\ years to finalize a simple
application form for an exemption from the individual mandate?
Secretary Sebelius. Well, sir, as you know, the individual
mandate is not in place until next year. We have made it very
clear that if somebody is Medicaid eligible in a State that
doesn't choose to expand Medicaid, they will be exempted from--
--
Mr. Gingrey. My last question. An estimated 16 million
people in the individual market have or will receive
cancellation notices stating their health insurance coverage
does not meet minimum coverage requirements of the Affordable
Care Act. The bill specifically grants you, Madam Secretary,
the power to determine the criteria for a hardship exemption.
Will you provide all of these individuals a hardship exemption
since the Affordable Care Act has taken away their plan? Will
you do that?
Secretary Sebelius. No, sir. And I think those numbers are
far from accurate. Ninety-five percent of Americans who have
health insurance will be in a continuous plan, Medicare,
Medicaid, employer-based, VA, 95 percent. Five percent, who are
in the individual market, a portion of those 5 percent, a
portion of them, about 12 million people, a fraction of those
12 million, will have a plan that doesn't meet the criteria and
has not been grandfathered in. They are indeed receiving
notices. Many of those individuals, half of them, will be
eligible for financial help getting a new plan, and they have
many more choices in the marketplace. So we will not have a
blanket exemption for them.
Mr. Gingrey. Sounds like a hardship to me, Madam Secretary.
Mr. Upton. Gentleman's time has expired.
Mrs. Christensen.
Mrs. Christensen. Thank you, Mr. Chairman.
And thank you, Madam Secretary, for being here. And thank
you for all that you and your staff at HHS has done in
implementing the Affordable Care Act to ensure that it would
provide the many benefits that children, to women, to Medicare
beneficiaries, and to ensure security to those who already have
insurance as well as lower costs.
Of course, the biggest complaint has been about the
application and the enrollment Web site, but we have heard over
and over from you that those are being addressed. But you would
recall, and I know my colleagues would recall, that Congressman
Rush and I have always been concerned about those who do not
have Internet access, those who are uncomfortable using the
Internet and would not use it. So I just wanted to just remind
everyone that there are other avenues for enrolling, either by
telephone or by paper, either alone or with the help of a
certified, you know, application assistant.
But my question goes to one of the rumors that's been
circulating. There are many rumors about how the Affordable
Care Act has affected part-time workers. And some of my
colleagues on the other side claim that the companies are
moving workers to part-time jobs because of the healthcare
reform law, and that low-wage workers are being detrimentally
affected. And I understand why these claims are being made, as
just another part of the ongoing effort to undermine the law.
Would you take a few minutes to just set the record straight on
the ``part-time'' issue?
Secretary Sebelius. Certainly. Ninety-five percent of
businesses in this country are small businesses, under 50 full-
time employees, and there is no responsibility that any of
those employers have to provide health coverage for their
employees. On the other hand, there are now tax credits
available for some of the smaller employers who want to offer
coverage to actually come into the marketplace.
For the other businesses, the businesses hiring 50 or more,
there is a standard that says an employee is considered full
time if he or she works 30 hours a week, and that really came
from a market snapshot with help from the Small Business
Administration of where employee benefits were in the private
market based on hours of work, what was a part-time or a full-
time employee.
What we know about the economic data is the high point of
part-time workers was in 2008 and 2009, at the height of the
last recession. It has been decreasing each and every year.
There is no data to support the fact that there is an uptick
based on the impending Affordable Care Act. I am sure that
there may be some individual employers making some business
decisions about how many workers they want full time and how
many part time, but I can tell you there is no economic data or
employment data that supports the notion that this is an effect
of the law.
Mrs. Christensen. So, in fact, it's my understanding that
part-time workers are at the lowest percentage of workers in
many, many years right now. And----
Secretary Sebelius. Well, and for the first time, as you
know, Congresswoman, part-time workers will have options for
affordable health coverage. They've never had that before.
They've never had options in the marketplace. They've never had
some help purchasing coverage for themselves and their
families. Their full-time colleagues have, but they have not.
So they will have options.
Mrs. Christensen. And just to be clear, I had another
really long question, but the last part of it, it would be fair
to say that at every point along the way, you expected this Web
site to work based on everything that you had been told by the
contractors up until that point.
Secretary Sebelius. Well, I expected it to work, and I
desperately want to get it working.
Mrs. Christensen. More than anyone else, I am sure.
Secretary Sebelius. I can't tell you how frustrated I am,
and we are committed to fixing it. And the only thing that I
think builds back the confidence of the public is fixing it.
Mrs. Christensen. Thank you, Mr. Chairman.
Mr. Upton. Gentlelady's time has expired.
Mr. Scalise.
Mr. Scalise. Thank you, Mr. Chairman, for holding the
hearing.
And thank you, Secretary Sebelius, for being with us.
Last week when the contractors that built the system were
here, I had asked them all under oath if they had actually
delivered the system they were contracted to build, and all
four of them answered ``yes.'' So I want to ask you, did the
contractors deliver the system that you contracted them to
build?
Secretary Sebelius. I don't think I can accurately answer
that question. What we know is we have a system that doesn't
function properly.
Mr. Scalise. We definitely know that.
Secretary Sebelius. As we fix things, we will know more
about what is broken along the way, and I'll be able to----
Mr. Scalise. So would someone in your office--somebody in
your office oversaw this implementation and received the
product.
Secretary Sebelius. That's true.
Mr. Scalise. And they either said, this is the product we
contracted and paid hundreds of millions of dollars to build,
or it wasn't. Does somebody in your office have the ability
to----
Secretary Sebelius. Well, I think that we can say that the
products tested, individually verified, individually function--
--
Mr. Scalise. But clearly it was an integrated system.
Secretary Sebelius. They don't work well together. And----
Mr. Scalise. Well, but I used to write programs for a
living. I developed software products for a living. If you're
developing an integrated system, it's irrelevant if one
isolated component works by itself, but when you plug it in
together it doesn't work, that's a system that doesn't work.
One of the questions I had and others had, somebody in your
agency made a decision weeks, literally weeks, before the
deployment to change the system instead of going from a browser
ability where somebody, just like on Kayak or just like on
Amazon.com, could go shop for products, look at prices before
they purchased, which is how consumers are used to doing this.
You all made the decision to change it around and gather all
their information first before you could let them see prices.
Was that you who made that decision?
Secretary Sebelius. No, sir.
Mr. Scalise. Was that Ms. Tavenner?
Secretary Sebelius. It was Ms. Tavenner and a team who
looked at not imposing additional risks on the system.
Mr. Scalise. Did that team make the decision because they
knew once people actually saw the prices--and we're getting
reports from all of our constituents of dramatically higher
prices than what they were expecting. Did you make the decision
because you knew that when they saw the prices, they might not
want to buy the products, so you wanted to gather their
information first?
Secretary Sebelius. Sir, first, I did not make the
decision. I was informed about the decision. We did it in----
Mr. Scalise. Did you agree with the decision?
Secretary Sebelius [continuing]. September rolling off a
number of features. And clearly they can see the products.
Note, there is no requirement to buy anything.
Mr. Scalise. Look, I spent over 2 hours trying to get into
the system. I never once got to a point where I could see a
price. I did get kicked out many times and got some of those
blanks screens other people got.
I do want to share some stories with you from some of my
constituents, because we started a page on our Facebook and on
Twitter. We are collecting what's called Share with Scalise.
People are sending us stories. And we're getting lots of
stories from my constituents. I want to read you a few of them.
Randall from Mandeville said, ``My healthcare premium went
up 30 percent. That's over $350 a month increase.''
We had Michelle from Slidell: ``Our insurance premiums are
going up $400 a month, and our deductible has increased.''
And then you've for the Sean from Covington, who said, ``My
current plan through United Healthcare is no longer being
offered in 2014 due to Obamacare. In fact, I received a letter
stating that the new healthcare law was indeed the reason for
the removal of my current healthcare plan.''
Madam Secretary, what would you tell Sean, who liked his
plan and now has lost it? And he was promised by you and the
President he'd be able to keep that plan. What would you tell
Sean now that he's lost his plan?
Secretary Sebelius. I would tell Sean to shop in the
marketplace and out of the marketplace, and he will find----
Mr. Scalise. Do you really think that's an acceptable
answer----
Secretary Sebelius [continuing]. And he will find
competitive prices.
Mr. Scalise [continuing]. To Sean?
Secretary Sebelius. Again, if United chose not to keep
Sean's plan in effect for Sean----
Mr. Scalise. Because of the law.
Secretary Sebelius. Sir, the law said if you keep Sean's
plan in place, if he liked his plan, if you only----
Mr. Scalise. Sean likes his plan----
Secretary Sebelius [continuing]. Applied trendlines to
Sean, then the plan is still there.
Mr. Scalise. You and I may disagree over who you work for.
I work for Sean. You work for Sean, Madam Secretary. Sean lost
his plan that he liked. And there are thousands and millions of
Seans throughout this country that lost the plan they like
because some bureaucrat in Washington said, we think your
plan's not good enough; even though you like it, even though
you were promised you could keep it, you're now not able to
keep that plan. I think you deserve to give Sean a better
answer than you just have to go shop for something else even
though you lost your plan.
Mr. Upton. Gentleman's time has expired.
Mr. Scalise. I yield back the balance of my time.
Mr. Upton. Gentleman's time has expired.
Mr. McNerney.
Mr. McNerney. Thank you, Mr. Chairman.
Thank you, Madam Secretary, for coming today.
I'm going to follow up on Mr. Doyle's line of questioning.
One concern I have with the fallout from the Web site is that
many users who tried to sign up and were discouraged because of
the problems will now be too discouraged to come back once the
site is fixed. So what do you plan to do to get those folks to
come back?
Secretary Sebelius. Well, sir, we intend to invite them
back formally, by email, by message, but we don't want to do
that until we're confident that they will have a different
experience. So fixing the site is step one, and then inviting
people back to the site to make it clear that when our
timetable is fulfilled, they have 4 months to shop for
affordable health coverage on a fully functioning site.
We know we're going to have to spend special time and
attention on young and healthy Americans, who don't start out
thinking they need health insurance, aren't aware of the law,
certainly don't want to use a failed or flawed site. So we're
going to have to spend some particular attention on them.
Mr. McNerney. Thank you.
Have the software specifications for the Web site and its
related software elements, including the test specifications--
has that changed since the initial rollout?
Secretary Sebelius. I know that there certainly are some
changes, because--since October 1st? I'm sorry.
Mr. McNerney. Yes. Since the rollout, the specifications.
Secretary Sebelius. The specifications haven't changed. We
are certainly fixing--as I say, speed and reliance is one of
the issues we're taking a look at. That's the performance side.
But there also are some functionality sides that things do not
work as they can, including the enrollment passed on to
insurers. So we are fixing functionality. And I don't think
that's a change in the specs; I think it is actually making the
system work the way it should.
Mr. McNerney. Well, are you--or is the Department doing
prioritization on the problems?
Secretary Sebelius. Yes.
Mr. McNerney. Could you describe that a little bit?
Secretary Sebelius. Yes. As of last week, when Jeff Zients
joined us for the short-term project, we asked him to lead a
sort of management team. We have pulled in all of our
contractors as well as additional talent that they may have
available. We have talked to tech folks in and out of the
private sector and insurance, some of their tech experts, to
get all eyes and ears; made a full assessment; developed a plan
for fixes along the way; have a punch list for going after
those fixes; and we are doing a daily tech briefing and blog to
tell people what we have found, what we have fixed, what is
coming next, what the functionality is. And we intend to do
that until it's fully functional.
Mr. McNerney. Thank you, Madam Secretary.
Looking past the initial problems with the ACA rollout, do
you think that the Affordable Care Act will be successful in
bending the healthcare cost curve and reducing the fraction of
our national economy that goes for health care?
Secretary Sebelius. Well, I think that we have already had
some success. I think the goal is to continue to achieve that.
A fully insured population arguably with preventive care, with
an opportunity to see a primary care doctor and not go through
the emergency room will in and of itself reduce costs. Having
people identified earlier who may have serious problems in
managing those problems will reduce health costs. But I think
the delivery system also needs some considerable help in paying
for not number of procedures, number of tests, number of
prescriptions, but paying for health outcomes.
Mr. McNerney. Thank you, Mr. Chairman.
Mr. Upton. Mr. Latta.
Mr. Latta. Well, thank you very much, Mr. Chairman.
And, Madam Secretary, thank you so much for being with us
today. Appreciate your testimony so far today.
What I'd like to do is I'll get these to you because
there's so many we've received. These are questions that we've
received from our constituents back home specifically about
what's going on with the Web site and for them. And so what
I'll do, I'd like to get those to you. But there's a lot of
questions here, and a lot of thought's gone into a lot of these
questions.
But if I could start with last week's testimony when four
of the contractors were here. And in one of the questions that
I had posed to Ms. Campbell from CGI, in her testimony she had
stated that they delivered the Medicare.gov and also the
FederalReporting.gov. And I had asked at that time were those
sites more or less complicated than the site we're talking
about here today. And she said, of course, the site today was
more complicated. And in the questioning and from her
testimony--and we've been hearing about this end-to-end testing
that wasn't happening, that we had individuals out there saying
that about 2 weeks had been done. But I'd asked her about was
there a sufficient enough time when they did Medicare.gov. And
the response that she gave me back was on Medicare.gov, which
was a less complicated site, and she stated that ``we had
sufficient time to test the system before it went live.'' And I
asked her in a follow-up then, ``What was that sufficient
time?'' And she said, ``We had a number of months before the
system went live at that time.''
And I just want to make sure, because, again, sometimes
things don't get reported accurately, but--in the U.S. News
there was a report on October the 18th of this year, and
there's some questions going back and forth. I just want to
make sure that you were quoted properly. Said, ``'After 2 weeks
of review,' the HHS Secretary concluded, 'we didn't have enough
testing specifically for high volumes for a very complicated
project. The online insurance marketplace needed 5 years of
construction a year of testing,' she said. 'We had 2 years and
almost no testing.''' Is that correct?
Secretary Sebelius. I don't know the quote. I never
suggested that we needed 5 years.
Mr. Latta. OK. That's just----
Secretary Sebelius. I don't know what that's from or what
that----
Mr. Latta. That's one of the things we're going to check.
Secretary Sebelius. We clearly did not ever have 5 years.
The law was signed in March of 2010.
Mr. Latta. OK. And then last week when you were down in
Texas, you were being asked by a reporter about the system and
the launch. And one of the parts of the question was that at
what point did you realize the system wasn't going to be
working the way that you envisioned before the launch, and why
didn't we stop it before the launch? And, again, this is what
was reported: ``We knew that if we had another 6 months, we'd
probably test further, but I don't think anyone fully realized
both the volume caused such problems, but volume's also exposed
some of the problems we had.''
Now, going back, though, to Ms. Campbell's statement that
they tested more extensively on a system that was not as
complicated, but HHS, CMS decided to go forward with only a
very short period of testing. Do you think that was acceptable?
Secretary Sebelius. Well, clearly, looking back, it would
have been ideal to do it differently. We had a product that,
frankly, people have been waiting decades to have access to
affordable health care. Medicare existed well before the Web
site. Medicare is a program that started 50 years ago. The Web
site was an additional feature for consumer ease and comfort.
And so they were not launching Medicare, they were not
delivering health benefits to seniors, they were putting
together an additional way to enroll in Medicare.
I would suggest, sir, that we had deadlines in the law,
that people had benefits starting January 1st. We wanted an
extensive open enrollment period so that a lot of people who
were not familiar with insurance, didn't know how to choose a
doctor or choose a plan, had never been in this marketplace, or
people who needed to understand fully what the law offered had
ample time to do that.
So the date that I was, again, required to select for open
enrollment, that's, again, part of the statute, how long would
open enrollment be. We picked that date. All the contractors
that began early in this process in the fall of 2010, when we
issued--I'm sorry, 2011, when we issued the initial contracts
to CGI and QSSI, knew the October 1st date. That was not
changed. It wasn't added to.
As we got closer to the system, one of the reasons, again,
that we pared down what needed to launch on October 1st was an
attempt to minimize the risks to the system to get people to
their ability to see clearly what they were entitled to, what
the plans were, and, if they chose to, to enroll. Clearly the
testing should have been longer, should have been more
sufficient.
Mr. Upton. Gentleman's time has expired.
Mr. Braley.
Mr. Braley. Thank you, Mr. Chairman.
Madam Secretary, people who are watching this hearing might
be under the assumption that there's some kind of political
debate going on over the Affordable Care Act. I think people in
Iowa don't care anything about who's winning the political
debate. They want these problems fixed, and they want them
fixed now. And I think that's the responsibility of everyone in
this room to make sure that that happens.
I tried to go into the marketplace on October 7, and I
encountered problems immediately dealing with the security code
questions which required you to select dates. One of them was
type a significant date in your life. Today is my birthday, so
I put that in. I tried three different ways of entering that
data and got a message each time: ``Important, this is not a
valid answer.'' Same thing for the third date entry. And a lot
of times when you're registering online for anything, and you
have to put a date in, there will be a little prompt there that
tells you what the format is you're required to enter.
Do you know, have we solved this problem in the security
code area?
Secretary Sebelius. Yes, sir. One of the initial issues was
just getting people into the site. And the ID proofing, which
is a two-step process, one is that you give some preliminary
information and you set up a password, but the second, to
ensure that your personal data can't be hacked, can't be
interfered with, is the second step where some personalized
questions, which only can be verified by you, are indeed part
of that.
Again, that was an initial hold-up in the system. We
focused a lot of attention on that in the first several days.
It was fixed, only to then discover that there were system
problems throughout the application. And that piece has been
fixed, but I would suggest it also was a function of trying to
make sure we had the highest security standards, that we were
not cavalier about someone's personal information being able to
be addressed and attached. And it was a functionality that
didn't perform properly, but does now.
Mr. Braley. One of the things that keeps coming up in this
hearing, because you are from Kansas, is references to The
Wizard of Oz. And people went to see the wizard because of the
wonderful things that he did. And the Affordable Care Act is
doing a lot of great things in Iowa. The Des Moines Register
wrote that ``Iowans buying health insurance on the government's
new online marketplace will face some of the lowest premiums in
the country. It's increasing competition in our State. Iowa
consumers are able to choose from 40 health plans in the
marketplace.''
You've mentioned the growth of healthcare spending is at
the slowest rate in 50 years. Fifty thousand Iowa seniors have
received prescription drug rebates. Bans on preexisting
conditions are allowing people to get coverage and switch
carriers. And now insurance premium increases are subject to
review and can be rejected by the people reviewing those plans.
But all of these good things don't mean anything unless we
solve these problems. And what I need to know is how confident
are you that the problems will be fixed by December 1st?
Secretary Sebelius. Well, again, Congressman, I have
committed to that date because that is the assessment of both
inside and outside experts have analyzed, and I think they
kicked all the tires and looked at all the system. I know that
there's no confidence in that date until we deliver on the
date. I am well aware of that, and that's on me.
Mr. Braley. Since Americans were supposed to have 6 months
to sign up, would you support ensuring they still have 6 months
by extending the open enrollment period for 2 more months?
Secretary Sebelius. At this point, Congressman, they will
have a--fully 4 months of fully functional all ways to sign up.
And again, there are alternate ways and the Web site right now
that people are getting through.
The open enrollment period is extraordinarily long. It's
about six times as long as a typical generous open enrollment
period. And it's important for the insurance partners to know
who is in their pool so, again, they can stay in the market
next year and know who they are insuring. So we think that the
timetable will allow people 4 months' time to fully use the Web
site. They can use it right now, they can use the call center,
they can go to navigators, they can enroll.
Mr. Upton. Gentleman's time has expired.
Mr. Harper.
Mr. Harper. Thank you, Mr. Chairman.
Thank you, Madam Secretary, for being here today. I'm sure
there are other things you'd rather be doing, but we welcome
the opportunity to have this conversation.
I'm going to ask the clerk to bring you a document for you
to look at so I can ask you a couple of questions.
If you can go to page 8 on that, I have highlighted an item
there. But this is a copy of a CGI slideshow from October 11
discussing technical issues that must be addressed within the
Web site. And on page 8 of what I've handed you, CGI
recommended that CGI and CMS have a review board to agree on
which issues can technically be solved and which should
politically be solved. Was such a review board convened?
Secretary Sebelius. Sir, I cannot tell you. I've never seen
this document, and I'm not aware of this recommendation.
Mr. Harper. But CGI is responsible for the Web site,
correct? Or for the operation?
Secretary Sebelius. CGI is responsible for the application.
Mr. Harper. For the application of this.
Secretary Sebelius. Yes.
Mr. Harper. Does it surprise you that in a slideshow that
they gave in October 11th, they acknowledge political reasons
for----
Secretary Sebelius. Sir, again, I've never seen this
document. I have no idea what that means. Did you ask CGI when
they came last week?
Mr. Harper. Can you find out for us if such a review board
was done and if any decisions were made on political reasons or
any other reasons and find that out for us?
Secretary Sebelius. Sir, I--that question needs to go to
CGI, but I can ask them to report to you.
Mr. Harper. If you will do that.
Secretary Sebelius. This is their document, if I
understand. This is not our document.
Mr. Harper. Would you turn to page 9 of that document,
please? And it states ``Challenges'' on page 9 in this
presentation by CGI. And it says, under ``Challenges,''
``Unable to determine at this time whether low enrollment
counts are attributable to system issues or due to users
choosing not to select or enroll in a plan.''
So those are two completely different issues, obviously. If
it is a system issue, that's something you have confidence at
some point will be resolved, correct?
Secretary Sebelius. Yes, sir.
Mr. Harper. And if it's a user selection issue, that's an
entirely different story; is it not?
Secretary Sebelius. Yes, sir.
Mr. Harper. OK. Now, when you used the phrase earlier about
a punch list, that's like having somebody move into a house.
Someone's buying a new house, and they go through, and they've
been told this house is going to be ready for you to move in on
October 1st. They load up the van, they come in. And they get
in, and it's not finished. Part of the plumbing's not right,
the wiring's wrong, and they go in.
This creates the situation where, health care shouldn't be
a zero-sum game. I mean, we want to be fair to everyone. We
want to help people who are vulnerable, but at the same time we
shouldn't have to hurt folks. We've got people in my district,
in my State, who are getting notices of cancellation. They are
being told of higher premiums that they're having. And these
are great concerns that we have. And how do we work through
that?
And I want to say I appreciate you accepting responsibility
for these initial rollout failures that we've had, but who is
ultimately responsible? It is the President, correct?
Secretary Sebelius. For the Web site? I would say that we
are.
Mr. Harper. I would say that the President is ultimately
responsible for the rollout, ultimately.
Secretary Sebelius. No, sir. No, sir. We are responsible
for the rollout.
Mr. Harper. But who do you answer to?
Secretary Sebelius. I answer to the President.
Mr. Harper. So is the President not ultimately responsible,
like a company CEO would be?
Secretary Sebelius. Sir, he's the President of the United
States. I have given him regular reports. And I am responsible
for the implementation of the Affordable Care Act. That's what
he asked me to do, and that's what I'll continue to do.
Mr. Harper. So you're saying that the President is not
responsible for HHS?
Secretary Sebelius. Sir, I didn't say that.
Mr. Harper. OK. So the President ultimately is responsible.
While I think it's great you're a team player and you're taking
responsibility, it is the President's ultimate responsibility,
correct?
Secretary Sebelius. You clearly--whatever. Yes. He is the
President. He is responsible for government programs.
Mr. Harper. My time is expired.
Mr. Upton. Gentleman's time has expired.
Mr. Lujan.
Mr. Lujan. Mr. Chairman, thank you very much. Before I
begin, I'd like to ask unanimous consent to submit into the
record some articles from New Mexico publications, the
Albuquerque Journal, and Albuquerque Business Journal, the
first entitled ``Small Business Owner: Health Exchange Will
Save Me $1,000 a Month.''
Mr. Upton. Without objection.
[The information appears at the conclusion of the hearing.]
Mr. Lujan. Thank you, Mr. Speaker. And I see my time did
begin there, so I'll try to get through this, Mr. Chairman.
Madam Secretary, I was intrigued by a line of questioning
by Congressman Green, asking questions about the individual
marketplace. How volatile was the individual marketplace before
the Affordable Care Act became law?
Secretary Sebelius. I would say it wasn't a marketplace at
all. It was unprotected, unregulated, and people were really on
their own.
Mr. Lujan. Madam Secretary, the Kaiser Family Foundation
reports that over 50 percent of individuals that have coverage
in the individual market churn out of coverage every year. They
either lose coverage, they are priced out or drop it. Is that
consistent with what you're aware of?
Secretary Sebelius. That's an accurate snapshot. About a
third of the people are in for about 6 months, and over half
are in for a year or less.
Mr. Lujan. So individuals that were in the individual
marketplace before the passage of the Affordable Care Act did
not have the same protections as those that were in group
coverage.
Secretary Sebelius. That's true.
Mr. Lujan. And would those individuals in the individual
marketplace sometimes have higher copays?
Secretary Sebelius. Higher copays, unlimited out-of-pocket
costs for often coverage that was medically underwritten or
excluded whatever medical condition they had in the first
place.
Mr. Lujan. So these were typically 1-year contracts. If
they use the plan because they got sick or in a car accident or
a victim of domestic violence, sometimes they'd be thrown off
their plans, or their rates would go up.
Secretary Sebelius. Yes.
Mr. Lujan. I think that's important to note, Madam
Secretary.
And I'm intrigued as well that my understanding is last
month HHS conducted an analysis that found that nearly 6 out of
10 uninsured Americans getting coverage through the marketplace
will pay less than $100 per month; is that correct?
Secretary Sebelius. They will have a plan available for
less than $100 if that's their choice, yes.
Mr. Lujan. And that number would be even higher, would be
better, if more States chose the option of using Federal funds
to expand Medicaid to cover their low-income population?
Secretary Sebelius. Oh, very definitely. That's just a
marketplace snapshot. Those are people who will be in the
marketplace.
Mr. Lujan. Madam Secretary, I don't think that I've heard
anyone from the other side of the aisle today, my Republican
colleagues, ask you how can Congress work with you and support
you in fixing this Web site and fixing this problem. I hope
that we all agree we want this Web site fixed. I would yield to
anyone that would disagree.
Seeing no one accepting that, I'm glad to hear that we
agree with this.
Now, Madam Secretary, what can Congress do to work with you
to fix this Web site?
Secretary Sebelius. Well, I'm not sure that there is hands-
on work that you can do, maybe we have some technical
expertise, but I would say getting accurate information to
constituents is helpful; letting people know that they can
check out the facts and the law; that they may be entitled to
some financial support; that cancellation of policies means
that the policy that they had may not exist, but they have a
lot of choices of new policies and a law that now says they
must be insured in a new policy, that they don't have to be
insured by their company at a higher price.
Mr. Lujan. I appreciate that, Madam Secretary.
Going back to the individual marketplace, Madam Secretary,
did this Congress in previous years before the Affordable Care
Act make it illegal for health insurance companies to raise
rates on someone after they submitted a claim for going to the
hospital or becoming sick or getting rid of preexisting
conditions?
Secretary Sebelius. No, sir.
Mr. Lujan. Madam Secretary, one last note here. It seems
that we've received some horrible news here that there are bad
actors already taking place of fraudulent Web sites that
imitate the healthcare exchange or misleading seniors into
disclosing their personal information. I've signed onto a
letter to you led by my colleague, Representative Raul Ruiz out
of California, to request that you prioritize fraud-prevention
efforts. What's the administration done to prevent these
fraudulent acts and protect personal information?
Secretary Sebelius. I can tell you, Congressman, that the
President felt very strongly that that needed to be part of our
outreach effort, which is why the Attorney General and I
convened representatives of State attorneys general, insurance
commissioners, the U.S. attorneys, and the Justice Department
and the Federal Trade Commission, which has jurisdiction, to
make sure that we first got out ahead of some of this
developing consumer outreach.
No one should ever give personal health information,
because personal health information is not needed for these
policies any longer. That's a red flag. We want to make sure
that people turn over potential fraudulent acts. We have put
training in place for navigators. We have our law enforcement
doing----
Mr. Upton. Gentleman's time has expired.
I would just note that, with the indulgence of the
Secretary, we're hoping that we can have all Members ask some
questions, but we also know that with 4 minutes, we're going to
have a little trouble. So I'm going to ask unanimous consent
that we try limit our questions and answers to no more than 2
minutes. And I've talked to Mr. Waxman. Is that OK? Because
otherwise there will be a lot of folks who will not be able to
ask a question at all.
Secretary Sebelius. Mr. Chairman, I would commit to if the
questions get submitted, we would be happy to provide timely
answers also to make sure----
Mr. Upton. Can I do that? So with that, we'll try 2
minutes.
Mr. Lance.
Mr. Lance. I guess I won the lottery on the 2 minutes.
Madam Secretary.
Mr. Upton. Time has expired.
Mr. Lance. Twenty seconds, Mr. Chairman.
On the Web site, Madam Secretary, the contractors testified
last week that they needed more than 2 weeks for end-to-end
testing. Why, in your opinion, was there not more than 2 weeks?
Secretary Sebelius. Again, we had products--the insurance
policies themselves by companies were loaded into the system.
So wecould test up until then, but it wasn't until September,
mid-September, that that was done. And, again, the contractors
said, we would have loved more testing time, but we think we're
ready to go ahead.
Mr. Lance. I believe that will ultimately be a dispute
between CMS and HHS and the contractors. And if there's
anything we can do regarding that, because obviously that
didn't work. And I had thought, given this signature issue with
the President, that the Web site would be ready.
Number two, in my judgment, the President's statements were
overstatements. The four Pinocchios is an indication of that.
There's a report in the New Jersey newspapers this morning that
800,000 people in New Jersey who purchased their policies in
individual or small-employer markets will be affected by this.
Mr. Walden in a previous question mentioned the fact that
in an individual market you would be able to keep your policy
grandfathered. Yet regulations issued by HHS say that
grandfathered status would not be continued for so much as a $5
change in a copay. Is that accurate, and do you believe that
that is a significant change?
Secretary Sebelius. Sir, we gave, I think, in the
grandfather regulations a guide for how pricing could change,
medical inflation, and I think it was in most cases a plus 15
percent. There were some individual consumer outfacing issues
that were more rigid than that. But I would say that in terms
of having companies being able to collect a profit margin, that
was certainly built into the grandfather status.
Mr. Lance. I think that's too little a change,
respectfully.
Mr. Upton. Gentleman's time has expired.
Mr. Tonko.
Mr. Tonko. Thank you, Mr. Chair.
And welcome, Honorable Secretary. Thank you for fielding
our questions and for responding when you were extended the
courtesy to offer a response.
As a strong supporter of the Affordable Care Act, I'm
frustrated, and I think it's fair to say that the American
people are frustrated as well. And I heard you here many times
this morning say you're frustrated.
I think by and large people want this law to work. When I
talk to folks back home in the capital region of New York that
I represent, even people who opposed the law initially aren't
rooting for the failure of the Affordable Care Act. Instead,
they want Congress to come together to fix these problems so
that we can move on to real issues that matter, like creating
jobs and growing the economy.
My home State of New York, which also experienced Web site
problems at the outset, has now completed enrollment
determinations on over 150,000 New Yorkers, with more than
31,000 having already signed up for quality, low-cost health
insurance. Given that many States have had success in
overcoming these initial Web site issues, has HHS looked at
what these State Web sites are doing as it searches for
solutions to the fix HealthCare.gov?
Secretary Sebelius. Absolutely. And we shared a lot of the
information going in. I think that the hub feature that we have
in our Web site that all States are using, including the State
of New York, is fully functional, and that's good news for New
York and California and others who are running their own State
Web sites. But we are learning from them, we've shared
information with them, and we are eager for all the help and
assistance moving forward.
Mr. Tonko. Thank you.
Similarly, many States made the illogical choice of
rejecting Medicaid expansion contained in the ACA that would
help some of their poorest citizens get access to the
healthcare situation. This is despite the fact that Medicaid
expansion is almost entirely financed by Federal dollars.
Can you comment broadly on HHS' plan in the future to
encourage more States to run their own marketplaces and expand
Medicaid so that the law can function as designed?
Secretary Sebelius. Well, absolutely. Most recently, last
week, the State of Ohio did move into the Medicaid market. And
we now have 30 Governors. I think 27 States have fully
completed the process. Another three are in the process,
Republicans and Democrats, some of whom sued us about the
constitutionality of the act, who are now deciding that for the
citizens of their State, they want to be part of the expanded
Medicaid. And we will continue to have those conversations.
It's not just about the marketplace, it's also about Medicaid.
Mr. Tonko. Thank you very much.
Mr. Upton. Gentleman's time has expired.
Dr. Cassidy.
Mr. Cassidy. You said that an individual policy is only
cancelled if it changes significantly. But, to be clear, after
May 2010, if coinsurance went up by any amount, even by a
dollar, according to your regulations, that would not qualify
as a grandfathered clause. Just to have that out there for the
record. I gather even by a dollar.
That said, I get a letter from someone in my district,
Adrian. She says that, oh, she lost her coverage. She lost her
coverage because spousal coverage is gone. She's gone on the
exchange, she doesn't qualify for a subsidy, but that her
premium and out-of-pocket costs, under any plan, is $10,000 a
year. She feels--she writes this--she feels betrayed by her
government. Now, she has to sit there asking herself, is this
fair? If you were she, do you think that this would be fair?
Secretary Sebelius. Dr. Cassidy, I want to start by the
amount that you gave is not accurate. I was told it's $5, not a
dollar.
Mr. Cassidy. That's for the copay, not for the coinsurance.
For the coinsurance, it's any amount. But I have limited time.
Do you think that if you were she, if you were Adrian, do
you think this is fair? Loses her spousal coverage, now it's
10K, no subsidies?
Secretary Sebelius. Sir, I don't have any idea what she's
looking at. I can tell you that, again, based on what we've
seen in the market, what we've seen in the plans, people will
be getting full insurance for the first time at competitive
prices.
Mr. Cassidy. Well, again, this is what she reports. Do you
think it's fair--if what she reports is true, do you think it's
fair?
Secretary Sebelius. I can't answer fair or not fair. I
don't know what she was paying or what she was paying before--
--
Mr. Cassidy. That's OK. Let's move on.
Secretary Sebelius. Did she have full insurance?
Mr. Cassidy. Richard writes that his daughter received a
note that his premium's going up because she's being lumped
with older, costlier patients. Now, it's possible that the only
people that sign up will be those who are more costly. Does HHS
have plans on what to do if only those who are more costly sign
up and premiums rise for everybody?
Secretary Sebelius. I think, sir, that's what we're trying
to do to make sure that----
Mr. Cassidy. But if only the costly----
Secretary Sebelius [continuing]. With the individual
mandate----
Mr. Cassidy [continuing]. Sign up, do you have plans?
Secretary Sebelius. That's the importance of the individual
mandate that you've just outlined. Getting rid of preexisting
conditions, making sure that people who come in----
Mr. Cassidy. But if only the most costly sign up, do you
have backup plans?
Secretary Sebelius. We will encourage others to sign up.
It's why there's a penalty in place and why----
Mr. Cassidy. Is this to assume that there are no backup
plans? I don't mean to be rude, but----
Mr. Upton. Gentleman's time has expired.
Mr. Yarmuth.
Mr. Yarmuth. Thank you, Mr. Chairman.
Madam Secretary, nice to see you.
I come to this hearing with a little bit different
perspective. Kentucky is doing a great job with our exchange.
As of this morning, we have 350,000 people that have explored
the Web site, 59,000 started applications, 31,000 are now fully
enrolled in new coverage, and 5,000 just in the last week. And
I think, very importantly, more than 400 businesses have begun
applying for their employees as well. So the idea that somehow
this is going to be bad for businesses is not borne out in
Kentucky.
Would it be safe to say that if 36 States had done what
Kentucky and New York and California have done instead of 14,
that the rollout would have been much smoother, and the Web
site would have been much easier to construct?
Secretary Sebelius. I don't think there's any question that
the--you know, in January of 2013, we knew how many States were
not running their own Web site. In, I think, mid-February we
learned about partnerships. So it was not until that point that
we learned that 36 States would actually be coming through the
Web site.
Having said that, we should have anticipated, we should
have planned better, we should have tested better. I don't
think that's any excuse. But we clearly are a running very
different vehicle for enrollment than we thought we were going
to run in March of 2010.
Mr. Yarmuth. On the subject of cancellation of policies,
isn't it true that, first of all, the Federal Government can't
require insurance companies to sell insurance?
Secretary Sebelius. That they can't?
Mr. Yarmuth. Federal Government can't require insurance
companies to sell insurance?
Secretary Sebelius. Yes, that's true. Yes, sir.
Mr. Yarmuth. And, in fact, insurance companies all over the
country are making very difficult decisions now about where
they want to participate and where they don't. And in some
markets they are actually trying to get out of the market,
canceling people, because they want to play in other markets
and so forth. They are all making those decisions now.
Secretary Sebelius. Well, and we know we have more
insurers, 25 percent more insurers, in the individual market
than we did prior to the law being passed.
Mr. Yarmuth. So there are a lot of dynamics going on here
that are not necessarily an indication that the President
misled anybody. There are business decisions being made all
over now.
Secretary Sebelius. Well, in cancellation of policies,
again, the 1-year contract notice is a routine in the
individual market. It has been in place for years. And for a
lot of people, they are policies now; they are being canceled
because they are being notified you can no longer being
medically underwritten. We can't charge you more because you're
a woman. We won't ever have the kind of limitation on what your
policy can pay out or charge you exorbitant out-of-pocket
rates. Those policies will cease to be offered in the
marketplace.
Mr. Upton. Gentleman's time has expired.
Mr. Guthrie.
Mr. Guthrie. Thank you, Madam Secretary, for being here.
And last week Mr. Lau from Serco was here. I know the
President's talked about the alternatives to the Web site is
phone calling or using paper, paper application. And what he
said, and I think you've said it with the phone, they take the
paper applications, but they enter them into the same Web
portal. So I know you get around the issue of getting on and
getting logged off, but also--but there are still issues with
data within the Web portal. As you said, you can't even get
reliable data who's even signed up.
So he also said because of the surge in paper applications,
it's, like, 6 to 8 weeks to process. So if November 30th is
when this will be ready that they can use--and even if you do
it now, 8 weeks, you're getting close to January 1st--if
somebody does lose their insurance, so they're signing up for
this, and they get to January 1st, even though you have a March
31st open enrollment, what happens to these? Is there a
contingency plan for these people to continue their insurance?
Secretary Sebelius. Sir, I think that we have improvements
every day on the speed of the site. Serco was giving you early
snapshots of difficulty of accessing the site. I think that's
greatly improved----
Mr. Guthrie. Well, they said just processing the paper,
actually. OK.
Secretary Sebelius. I understand. But it is the site for--
they put the application into the site and get a determination.
That's part of what the process is.
So the site is part of the portal all the way through. This
is an integrated insurance vehicle, and so that will improve.
And we--again, with 4 months of continuous service, which is
far longer than most people had, some of these cancellation
numbers--Mr. Geraghty again pointed this out from Florida Blue
Cross, but it's true of everyone else--these are not January
1st numbers, they are year-long numbers. So over the course of
2014, when an individual's policy is due to expire, that
individual----
Mr. Guthrie. But somebody's could expire January 1st and
not be able to get coverage if the Web site--and the vendors
said they needed months to test, they would have liked to have
months and months to test. That's what they said. So if we are
going to get November--even if it works November 30th----
Secretary Sebelius. I would say we're testing as we go.
This is beta testing going out right now. That's why we're
fixing and how we can identify things. People are getting
through every day. And we now know a lot more----
Mr. Guthrie. I know I'm out of--but the paper process, if
it does take even 4 weeks, and it's November 30th, and people's
cancel on January 1st, you--there needs to be a contingency for
that person.
Secretary Sebelius. Well, again, typical insurance is 2 to
4 weeks of sign-up. They will have 2 full months of sign-up.
Mr. Upton. Gentleman's time has expired.
Ms. Schakowsky.
Ms. Schakowsky. Thank you, Madam Secretary, for bringing to
millions of Americans access to affordable, comprehensive
healthcare coverage that's going to be there when they need it.
I want to thank you especially as a woman. Women can no
longer--being a woman can no longer considered being a
preexisting condition. Women can no longer be charged more than
a man for the same coverage. Women have access to comprehensive
benefits like prescription drugs, and free preventive
screenings, and free contraceptive coverage, and maternity
care, which is often left out of coverage. And the days of
complicated pregnancy, or diabetes, or domestic violence being
a preexisting condition, those days are over.
You know, I want to say to my colleagues, after a 3-1/2-
year campaign to repeal, to discredit, to even shut down the
government over Obamacare, I want to say, get over it. We all
agree that there are problems, but these are problems that I
see being fixed.
And so I want to ask one--oh, and I want to say that what
we did under Medicare Part D can be an example of how we can
work together. And, in fact, Chairman Upton and I both sent a
letter asking for more money for community-based groups to help
implement the program and make it work. We can work together.
So if you could just briefly say how are the navigators;
how important are they in making this system work for the
American people?
Secretary Sebelius. Well, what we know, Congresswoman, is
that a lot of people are not Web savvy and are not frustrated
by the Web site, because they don't have a computer, they don't
want to use a computer, they don't trust a computer. They need
a live human being to ask questions, get questions answered,
talk about the plan, talk about insurance. So the navigators
play a hugely important role.
We have about 2,500 trained navigators on the ground right
now. We have thousands more community assisters who are trained
and ready to go. About 45,000 agents and brokers have gone
through specific Affordable Care Act training. But those
individuals working with their clients, customers, and, in the
case of navigators and community assisters, just the public at
large, they are not paid by a company, they are not collecting
a fee, they just want to help people get coverage, they are
hugely important.
Ms. Schakowsky. Thank you.
Mr. Upton. Gentlelady's time has expired.
Mr. Olson.
Mr. Olson. I thank the chair.
And welcome, Madam Secretary.
Secretary Sebelius. Thank you.
Mr. Olson. I'd like to open with a quote from an American
icon. I'll hold up a poster. It says, ``If a user is having a
problem, it's our problem.'' I'm glad to hear that you embrace
this philosophy during your testimony, ma'am.
Obamacare was signed into law 1,256 days ago, and since
then there's been user problem after user problem after user
problem.
Regarding HealthCare.gov, your Deputy Administrator for
Consumer Information, Gary Cohen, testified 1 month ago, right
where you're sitting, that--and this is a quote--``CMS has
worked hard to test the infrastructure that will allow
Americans to enroll in coverage confidently, simply, and
securely,'' end quote. Yet according to Forbes and the Wall
Street Journal, you told them that you needed 5 years of
construction and 1 year of testing. The program has crashed and
burned at least three times, and the user is still having
problems. It's been down the whole time you've been testifying.
The system is down at this moment.
My question, ma'am, is very simple: When did you know these
changes were going down? A month? A day? A quarter? And did you
tell the President what you knew?
Secretary Sebelius. Sir, I was informed that we were ready
to launch on October 1st. The contractors who we had as our
private partners told us and told this committee that they had
never suggested a delay, and that is accurate. Our CMS team
felt we were ready to go.
I told the President that we were ready to go. Clearly I
was wrong. We were wrong. I--we knew that in any big, new,
complicated system, there would be problems. No one ever
imagined the volume of issues and problems that we've had, and
we must fix it.
Mr. Olson. Yes, ma'am.
Credible journalists said you know you needed 6 years to
get the program up and running.
Secretary Sebelius. Sir, that quote has been repeated. I
can guarantee you I would have never stated that, because the
law was passed in March of 2010. I chose the open enrollment
date. I don't know where that quote comes from, but that is not
from me.
Mr. Upton. Gentleman's time has expired.
Mr. Barrow.
Mr. Barrow. Thank you, Mr. Chairman.
And thanks for attending today, Madam Secretary. I suspect
that deep down most people on this committee support the
concept of reforming insurance markets so that more people have
access to better insurance coverage. We have disagreements
about the means used to get at those ends, which is ultimately
why I voted against the Affordable Care Act.
But it seems that every day we're hearing of something new
going wrong. I'm concerned that these short-term enrollment
problems could become long-term insurance market problems. My
constituents are already losing confidence in the Federal
Government's ability to pull this thing off, and I think the
only way to begin to restore their trust is to delay the
individual mandate penalties until we're sure this system is
going to work. It's not fair to penalize consumers when their
noncompliance is not their fault.
We also need to take the time make sure additional fits and
starts won't cause larger problems. Right now I'm less
concerned about who's to blame, more concerned about what went
wrong and how to fix it and how we're going to ensure it
doesn't happen again.
Nearly all of our constituents want and need health
insurance. It would be a huge mistake if we were so blinded by
our love or our hatred for Obamacare that we miss opportunities
to address its flaws.
Now to the subject of technical problems becoming market
problems. Can problems of folks getting into the system
snowball into risk pool problems where those who choose not to
enroll can actually affect the cost of those who do choose to
enroll?
Secretary Sebelius. Certainly. A risk pool needs a balanced
market, so you need people who are older and sicker to be
balanced with people who are younger and healthier. That's how
a pool works.
Mr. Barrow. At what point are we going to see a problem
having the risk pool if the tech problems cause--affecting the
folks who are entering? What are we going to look for? What are
we going to use to decide something needs to be done?
Secretary Sebelius. Well, again, sir, we will be monitoring
during the 6 months of open enrollment, as will our insurance
partners, who is coming into the pool. That's why we want to
give this committee and others reliable, informed data about
not only who it is, but what the demographics are and where
they live. That's part of our target.
Mr. Barrow. If things aren't better by the end of this next
month, at what point are we going to start thinking about
further delays and imposing penalties?
Secretary Sebelius. Well, again, I think that having a
defined open enrollment period is one of the ways that you then
make an assessment if you have a pool that works or not. You
cannot have an unlimited open enrollment period with any
insurance company, because that really doesn't work.
Mr. Barrow. Thank you.
Mr. Upton. Mr. McKinley.
Mr. McKinley. Thank you, Mr. Chairman.
Last week the CGI representative Campbell said she had met
her contract obligations and met the specifications. And she
said the only problem she had was with pace, but the pace
wasn't part of the specification. We asked her what you would--
you would testify to. Did--she said you would testify that she
did complete her contract in accordance with the
specifications. Would you?
Secretary Sebelius. Sir, I don't think until the product is
working the way it's designed to work that anybody has finished
their job. And that's really my interest.
Mr. McKinley. Thank you. I'm sorry, with time, they've
shortened our time.
So if she hasn't met their specifications, but yet we're
still using her, so is the American taxpayer still paying the
money to fix the problems that her company didn't do in the
first place?
Secretary Sebelius. None of our contractors have been paid
the amount of their----
Mr. McKinley. Will she be paid for this work into the
future as we go to correct this problem?
Secretary Sebelius. We will make that determination as the
work goes forward. I would tell you, sir, that as we learn what
needs to be fixed, how long it takes, we'll know more about
whether they delivered.
Mr. McKinley. I'm very sorry, but the time frame has been
cut down.
Who owns the software now? Now that this has been developed
with taxpayer money to develop the software to do this----
Secretary Sebelius. It is owned by the Centers for Medicaid
& Medicare Services.
Mr. McKinley. So it's all owned by us. OK.
Will they be able to use it by a license for other clients?
Secretary Sebelius. Not to my knowledge. I think it is
specifically designed for the marketplace with these products
in mind.
Mr. McKinley. Thank you.
Then last question to trying to work----
Secretary Sebelius. And the clients are the American
public.
Mr. McKinley [continuing]. Under IV&V, and she testified
that she thought that was something we should have done. Under
HHS, you recommend or the HHS recommends that for software
development, that they should have an independent verification
and validation program, but it wasn't used in this case. Can
you share with us in the--the time that's gone why we didn't
use IV&V on something that's----
Secretary Sebelius. Again, I don't think that's accurate,
sir. At every point along the way, there is independent
testing. There is----
Mr. McKinley. Independent.
Secretary Sebelius. Yes.
Mr. McKinley. You recommend independent----
Secretary Sebelius. An outside----
Mr. McKinley [continuing]. Verification and validation. Not
someone within your staff.
Secretary Sebelius. Pardon me? There is a level of company
self-attested testing, there is a level of CMS testing and then
there is an independent test on each piece of the contracting;
an independent, not CMS.
Mr. McKinley. You've acknowledged it wasn't done
independently, and that's the----
Mr. Upton. The gentlemen's time----
Mr. McKinley. It needs to be done independently. People
that do not have a----
Mr. Upton [continuing]. Has expired.
Secretary Sebelius. No.
Mr. McKinley [continuing]. A dog in the fight.
Secretary Sebelius. It isn't CMS. I will get you the
information. There are three levels of testing. One of them is
independent for every piece of this contracting, yes.
Mr. Upton. Mrs. Castor.
Ms. Castor. Good morning. When open enrollment began a few
weeks ago, the people back home in Florida who are helping
their neighbors sort through the new options for coverage, the
navigators, were taken aback by how grateful people are to have
a new pathway to the doctor's office and the care they need,
affordable options. They're no longer being discriminated
against because they had cancer and diabetes or asthma, and
they are very grateful. They said to me directly it's like they
found water in the desert.
Right now they are--surprisingly, they said it's taking
time, because people want to sort through all of these options
before they finally sign up at the end of the 26-week
enrollment period.
So we must fix the marketplace, we must, to meet their
expectations. And we have very high expectations for you and
for the administration.
But I think it's important to point out the Affordable Care
Act is more than just a Web site. Despite all the obstruction
by Republicans in my home State of Florida, nationally, even
going so far as to shut down the government, millions of
Americans are already benefiting, and they are benefits that
are not tied to HealthCare.gov.
So, Madam Secretary, let's clarify what's working, despite
HealthCare.gov. Is it correct to say that many of the
improvements that the ACA makes to employer coverage and to
Medicare, where the vast majority of Americans who receive
their coverage, are not dependent on HealthCare.gov?
Secretary Sebelius. That's correct.
Ms. Castor. And so the delays and problems with
HealthCare.gov do not affect the millions of individuals,
thanks to the ACA, who no longer have to worry about lifetime
monetary caps on their coverage that previously sent them to
bankruptcy?
Secretary Sebelius. That's absolutely true. And I think the
quote that the President was quoted recently saying if you have
health care, you can--you don't have to sign up for the new
marketplace was referring to that large portion, the 95 percent
of insured Americans whose plans are solid, stay in place and
move forward.
Ms. Castor. And I understand the frustration with the Web
site. What I don't understand is why people are not similarly
outraged by the lack of Medicaid coverage in many of our
States. Do you find that hypocritical?
Secretary Sebelius. Well, I think it's very troubling that
millions of low-income working Americans will still have no
affordable option if States don't take advantage of the
expansion program, leaving States bearing the cost of
uncompensated care, families bearing the costs of parents who
can't take care of their kids, workers not able to go to work,
and people still accessing care through emergency room doors,
the most expensive, least effective kind of care they could
get.
Mr. Upton. The gentlelady's time has expired. Mr. Gardner.
Mr. Gardner. Thank you, Mr. Chairman. And thank you,
Secretary Sebelius, for being here.
Here's my letter. This is the letter that my family got
canceling our insurance. We chose to have our own private
policy back in Colorado so we could be in the same boat as
every one of my constituents, and yet my insurance policy has
been canceled. The White House Web site says, if you like your
health plan you have, you can keep it. Did I hear it wrong?
Secretary Sebelius. Again, sir, I don't know how long
you've had your policy or what policy----
Mr. Gardner. Why aren't you losing your insurance?
Secretary Sebelius. Pardon me?
Mr. Gardner. Why aren't you losing your health insurance?
Secretary Sebelius. Because I'm part of the Federal
Employee Health Benefits plan.
Mr. Gardner. Where aren't you in the exchange? You're in
charge of this law, correct? Why aren't you in the exchange?
Secretary Sebelius. Because I'm part of the Federal
Employee Health Benefits plan.
Mr. Gardner. Why aren't you in the exchange? Why won't you
go into the exchange? You're a part of this law. You're
literally in charge of this law. Should you be any different
than all of the other Americans out there who are losing their
health insurance today?
Secretary Sebelius. I'm part of the 95 percent with
affordable available health coverage, as are----
Mr. Gardner. You're part of a plan that----
Secretary Sebelius [continuing]. Most of your colleagues in
this room.
Mr. Gardner [continuing]. Most Americans don't have
available to them. Why will you not agree to go into the
exchange?
Secretary Sebelius. I am not eligible for the exchange.
Mr. Gardner. I went into the exchange.
Secretary Sebelius. Because I have coverage in----
Mr. Gardner. You can decide----
Secretary Sebelius [continuing]. The employee side.
Mr. Gardner [continuing]. To drop the coverage of your
employer. You have the choice to decide not to choose----
Secretary Sebelius. Well, I--that is not true, sir.
Mr. Gardner. I chose not to go into the congressional----
Secretary Sebelius. Members of Congress are now part of the
exchange thanks to an amendment----
Mr. Gardner. Before----
Secretary Sebelius [continuing]. That was added by
Congress, but I am not eligible----
Mr. Gardner. Madam Secretary, with all due respect----
Secretary Sebelius. If I have affordable coverage in my
workplace, I am not eligible to go into the marketplace.
Mr. Gardner. With all due respect, Madam, I would----
Secretary Sebelius. That's part of the law.
Mr. Gardner [continuing]. Madam Secretary, I would
encourage you to be just like the American people and enter the
exchange----
Secretary Sebelius. I----
Mr. Gardner [continuing]. And agree to find a way to do
that, Madam Chair.
Secretary Sebelius. It's illegal.
Mr. Gardner. Madam Secretary. And I would like to show you
an advertisement that's going on in Colorado right now. This is
an advertisement that a board member of the Colorado exchange
has put forward. Do you agree with this kind of advertising
for----
Secretary Sebelius. I----
Mr. Gardner [continuing]. Obamacare?
Secretary Sebelius. I can't see it. And, again, it's----
Mr. Gardner. It's a college student doing a keg stand.
Secretary Sebelius. If the Colorado exchange did that, they
are----
Mr. Gardner. Do you approve of this kind of advertising?
Secretary Sebelius [continuing]. A State-based marketplace.
Mr. Gardner. Do you approve of this kind of advertising?
Secretary Sebelius. I don't see it. I don't know what it
is, and I did not approve it. This is a State-based
marketplace.
Mr. Gardner. That's a pretty big font, that's a pretty big
picture of a keg----
Secretary Sebelius. I----
Mr. Gardner [continuing]. And you can't see it?
Secretary Sebelius. Sir, do I approve of it.
Mr. Gardner. You----
Secretary Sebelius. I've never seen it.
Mr. Gardner. You have the ability to opt out, by the way,
as a Federal employee. You could take the insurance. So I
just----
Secretary Sebelius. If I have----
Mr. Gardner. I would encourage you to make that decision.
Secretary Sebelius [continuing]. Available employer-based
coverage, I am----
Mr. Gardner. I would also like to submit a----
Secretary Sebelius [continuing]. Ineligible for----
Mr. Gardner [continuing]. Waiver from my district from
Obamacare, and hope that you will consider waiving Obamacare
for the Fourth Congressional District.
Mr. Upton. Gentleman's time has expired.
Mr. Waxman. Does your policy cover--never mind.
Mr. Upton. Mr. Matheson.
Mr. Matheson. Well, thank you, Mr. Chairman. And, Madam
Secretary, thanks for your time. I just want to ask, on the
issue of the fixes to HealthCare.gov, we've had a lot of
conversation about that today, and we've talked about
confidence levels for being ready by a certain time, but I
think one question that a lot of us have is can you define what
the magnitude of the problem is? Is there a scale or a metric
by which we can understand how bad this is today and how we're
going to get to where we go to have it fixed?
Secretary Sebelius. Well, again, sir, I've been informed
that the problems are in--and the reports I've seen are really
in two areas. They are in the performance area, which is speed
and reliability. It's too slow, it doesn't have reliable
transfers. And in functionality. There are parts of the system
that just don't make accurate transfers. So we have done an
extensive assessment. They are prioritized, as I indicated
earlier. One of the priorities is the enrollment features which
pass individual information to the companies where they want to
enroll. That is not reliable at this point. The companies are
not getting accurate data. So it's an example of the kind of
thing we know we need to fix.
Mr. Matheson. And is there a way to have you set up your
metrics to figure out if we're making progress in terms of if
you're fixing those issues with speed and performance and
functionality?
Secretary Sebelius. Again, with a team and Jeff Zients at
the head of it reporting to Marilyn, there are definitely a
comprehensive set of issues going forward that will be measured
and accelerated.
Mr. Matheson. Do you have target dates along the way if you
want to meet the November 30th time to assume it's functional
at what you want, do you have target or metrics along the way
to make sure you're on that path?
Secretary Sebelius. My understanding is yes, there are sort
of groups of targets, that fixes, as you know, can be loaded
together.
Mr. Matheson. Right.
Secretary Sebelius. It isn't one at a time, so they don't
take days, but they're trying to determine with a specific
path, it's one of the charges that QSSI has really looking at
the umbrella of what needs to be fixed, prioritizing them,
figuring out what destabilizes if something else is fixed, how
they can be grouped together, and that report will be in later
next week.
Mr. Matheson. OK.
Mr. Upton. The gentleman's time has expired. Mr. Pompeo.
Mr. Pompeo. Great. Thank you. Thank you for coming,
Secretary Sebelius. It won't surprise you that I would like to
talk about Kansas a little bit today. Much like with some of my
colleagues that made references to the ``Wizard of Oz,'' I
don't think anybody not from Kansas should be able to do Oz
allegories, but my story, the way I think about it is those
folks worked awful hard to go down that yellow brick road, and
at the end of the day when they got there and pulled back the
curtain, they found out there was nothing that they didn't
already have. And as we pull back the curtain on the Affordable
Care Act, I think people are finding that it's not exactly what
they are going to have worked so hard to find their way to as
well.
I want to talk about two stories. There's this commitment
that said if you like your plan, you can keep it. I have a
letter I'll submit for the record from Mr. Brito in Kansas. You
might know him. I saw him the other night in Benton. He got the
following letter from Blue Cross Blue Shield that says, because
your current plan does not offer the benefits standards
specified, you will be discontinued on December 31st. And it
says, good news. And then there's a group of folks, Pizza Hut,
you know the company from Kansas, franchisees, founded there.
Secretary Sebelius. Yes, I do.
Mr. Pompeo. Lots of those folks have now taken employees,
families who were working there, and they've gone from having
full-time jobs to part-time jobs, so they aren't able to keep
the health care plan that they had either and the one that they
wanted.
Why were the plans these folks had good enough when you
were the insurance commissioner in Kansas and when you were
Kansas's governor, but those plans today aren't good enough for
those hardworking Kansas families?
Secretary Sebelius. Sir, I would tell you in the roles I
had the honor of serving of in Kansas, I worked every day to
try and eliminate some of the discriminatory features of the
insurance industry that finally, with the Affordable Care Act,
are gone. My successor and elected insurance Republican
commissioner, Sandy Praeger and I worked on a whole series of
plans to expand coverage. So I did----
Mr. Pompeo. But----
Secretary Sebelius [continuing]. Work on these issues. We
were not able to necessarily----
Mr. Pompeo. So you thought these----
Secretary Sebelius [continuing]. Get them passed.
Mr. Pompeo. To use your words, you said these were, I think
you said, lousy plans, and Ms. Tavenner said, not true
insurance. You think that the plans that were offered when you
were insurance commissioner weren't true insurance?
Secretary Sebelius. In the individual market, the insurance
commissioner in Kansas and virtually every place in the
country----
Mr. Pompeo. So if the----
Secretary Sebelius [continuing]. Does not have regulatory
authority over the plans----
Mr. Pompeo. Let me ask the questions.
Secretary Sebelius [continuing]. And a lot of them are not
insurance.
Mr. Pompeo. Were they true insurance plans when you were
insurance commissioner?
Secretary Sebelius. A lot of them were not true insurance
plans, no.
Mr. Pompeo. Thank you. I yield back.
Mr. Upton. Gentleman from Vermont, Mr. Welch.
Mr. Welch. Thank you. I'm going to try to just summarize
correctly what I've been hearing. Number one, the Web site must
be fixed, you've been very forthright, and you're going to fix
it.
Number two, I'm hearing a tone change. We've had a real
battle about health care. We had a battle in this Congress. It
was passed. The President signed it. The Supreme Court affirmed
it. A really brutal battle. There was an election where the
American people affirmed it. And then the last gasp effort was
the shutdown and the threat of debt default. But what I'm
hearing today is that there are problems and people want to fix
them, because all of us represent people who are going to win
or lose depending upon how effectively this is rolled out.
Third, there's some significant question about existing
insurance policies, what the President said and so on, but
let's acknowledge something. A lot of insurance companies were
ripping off innocent American people by promising them
insurance until they got sick, and then it got canceled because
they ``had a pre-existing condition that wasn't, `disclosed.'''
That's got to end. The challenge for us going forward is to
make health care affordable.
So, Madam Secretary, my question is, is there any
indication that there's been a slowing of premium increases as
a result of the Affordable Care Act, because unless we can keep
those premium increases down, they can't rise faster than the
rate of inflation, wages and profits, all of us are going to
lose.
Secretary Sebelius. Well, I would say the trends in the
private market over the last 3 \1/2\ years are that cost
increases have slowed down, are rising at a lower rate than the
decades before. And, in fact, in this individual market, the
old individual market, the typical increase was 16 percent year
in and year out, rate increase, and often that came with
additional medical underwriting. So it gives you a sense of how
the costs were.
We know that Medicare costs are down. We know that Medicaid
costs actually had a decrease per capita last year, not an
increase per capita, and underlying health care costs are down.
These rates in the new marketplace, have come in about 16
percent lower on average than was projected; not by us, but by
the Congressional Budget Office. And we know that in many of
these markets, they're much more competitive. I believe in
market competitiveness. That actually drives down rates. The
States where the most companies are participating have the
lowest rates. And new companies have come in significantly
below the old monopoly companies that often dominated this
individual marketplace. So we're on a pathway. Are we there?
No. But you're absolutely right: affordable coverage at the end
of the day for everybody is the goal.
Mr. Welch. OK. I yield back. Thank you, Madam Secretary.
Mr. Upton. Madam Secretary, I'm trying to make sure that
you're out of here by 12:30 before we start the second round of
questions.
Mr. Kinzinger.
Secretary Sebelius. That was a joke, right.
Mr. McKinley. I see sheer panic.
Madam Secretary, thank you for being here. You stated
earlier to Mr. Harper that you give the President regular
updates on the marketplace. The President stated that he knew
nothing about the status and functionality of the marketplace.
How often and what were the subjects of those updates?
Secretary Sebelius. Well, I think there were a series of
regular meetings with the President, with some of our Federal
partners, with offices of the White House, from the OMB to
others on a monthly basis giving reports on policy and where we
were going. None of those, I would say, involved detailed
operational discussions. That wasn't the level. It was, are we
coming together? Do we have companies? Do we have plans?
Mr. McKinley. Sure. And I understand that. I mean,
obviously when it comes to the President of the United States,
certain level of details, you have to see it kind of a 10-,
20,000-foot overview, but in terms of the actual functionality,
whether it's the Web site or the marketplace, he was
legitimately caught off guard on October----
Secretary Sebelius. Well, I assured him that we were ready
to go. Everyone knew with a big plan that there were likely to
be some problems. No one----
Mr. Kinzinger. OK.
Secretary Sebelius [continuing]. Anticipated this level of
problems.
Mr. Kinzinger. And just a second, a quick question. Where
is HHS getting the money to pay for these fixes? Is it coming
from other HHS accounts? Have you used your transfer authority
to move money from non-ACA programs to pay for the cost of
implementing the President's health care program, and if so,
from which programs have you drawn money to help with the fix
that's not ACA-related?
Secretary Sebelius. Well, as you know, Congressman, it's
been 2 years since we've had a budget at HHS and we also have
not had--at the President's requested implementation budget
authorized by the Congress, each of those years we have used
not only resources internally, but I do have legal transfer
authority that I've used and a non-recurring expense fund. We
will get you all the details of that.
Mr. Kinzinger. Great. Thank you.
Secretary Sebelius. We've been reporting that to Congress
regularly.
Mr. Kinzinger. So the answer is yes, though, there is some
non-ACA money being transferred and used for the implementation
of ACA?
Secretary Sebelius. There is money that is specifically
designed for either outreach and education, so the health
centers have hired education outreach people as part of their
outreach for health personnel. I would say it's definitely a
related cause to get expanded health care.
Mr. Kinzinger. Thank you. Thank you, Mr. Chairman.
Mr. Upton. Mr. Sarbanes.
Mr. Sarbanes. Thank you, Mr. Chairman. Thank you, Madam
Secretary, for being here. My understanding is that a lot of
the companies, insurers that have been offering plans in the
individual market, the ones who are sending out these notices
are actually repositioning themselves in the health insurance
exchange to offer alternative plans. Is that correct?
Secretary Sebelius. Yes.
Mr. Sarbanes. And in addition to those insurers who've been
in the individual market, you now have a lot of other companies
and insurers providing plans in the health insurance market?
Secretary Sebelius. That is true.
Mr. Sarbanes. So the way I look at this is, I went to buy
Orioles tickets a while back when the season was still
underway, and I was standing in line and I got up to the ticket
window, and they closed the window, but I didn't have to go
home, because they opened another window a few feet away.
So essentially what's happening is people are coming up on
the renewal period, they're getting up to the window of the
individual market, they're being told, well, that window's
closed, but if you go right down the line here, there's another
window that's open. And, by the way, when you get there, you
will get better coverage potentially at reduced premiums, and
if you go down to window three, there's some subsidies that may
also be available to you.
So this notion that people are being turned away from an
affordable product that provides good, quality care is
preposterous. In fact, they're being steered to a place where
they can get good quality coverage, in many instances much
better than the coverage that they had before, at an affordable
rate that is supported by the subsidies that can be available
to many, many people.
This is what's so promising about the Affordable Care Act,
and so I think it's important for people to understand that
that window is not being shut, they're just being steered
someplace else where they can get a good opportunity.
Secretary Sebelius. And I think the first option for those
companies is to say we'd like to keep you here and here are the
plans we're offering, but to be fair, customers will now have
an opportunity to look across a landscape, which they couldn't
before, they will have entry into those other windows, which
many of them didn't have before with a pre-existing condition,
and as you say, about 50 percent of this market will have
financial help in purchasing health insurance, which none of
them had before.
Mr. Upton. Gentleman's time has expired. Mr. Griffith.
Mr. Griffith. Thank you, Mr. Chairman.
Earlier in your testimony here today, you said a couple
times the plans we enjoy, but then as you noticed with Mr.
Gardner's eloquent testimony, that we're not going to be in the
same plan that you're in after January 1. I was one of those
who thought it was a good idea as a part of a proposal that was
floating around the halls here in Congress that the President
and the cabinet secretaries ought to also be in the marketplace
and not have a special Federal plan that you will have after
January 1, but that we will not.
The President, while that was being discussed, issued a
veto threat. Did you discuss the veto threat with the President
before he made it and have you discussed it with him since
then? Yes or no on the first.
Secretary Sebelius. No.
Mr. Griffith. No. And then I would have to ask you relating
back to the contractors involved in this, CGI told us that the
Spanish Web site was ready to go, that they thought everything
was ready just as they did with the regular site, and obviously
that didn't prove out, but that they were told not to implement
it; likewise, the shop and browse section was ready to go. Do
you think that they were misleading this committee when they
made those comments?
Secretary Sebelius. I think what they believed is that that
product, independent of the entire operational site, was ready
and tested. What--a determination was made. I was involved with
the Spanish Web site----
Mr. Griffith. Let me----
Secretary Sebelius [continuing]. And the Medicaid transfers
to say let's minimize the risk for the whole site, let's load--
--
Mr. Griffith. But let----
Secretary Sebelius [continuing]. These later.
Mr. Griffith. But that raises the next question now,
because one of the other contractors, QSSI, I believe it was,
indicated to us that part of the problem was was that once you
took away the ability to browse, everybody had to go through
the business of setting up an account, and you stopped one of
the browse--or CMS stopped one of the browsing options as well,
and that that actually contributed to the logjam and
contributed to the problems. So is he correct on that, that not
allowing people just to look without having to sign up,
wouldn't that have made it easier for the American people?
Secretary Sebelius. In hindsight, I think that probably
would have been advantageous. I can tell you that the reason
the decision was made going forward was to minimize risk. That
didn't work so well, but adding additional features that didn't
involve people actually wanting to get to what they would
independently pay and what they would qualify for and what the
plans were seemed to be things that could be added down the
road. It was wrong.
Mr. Upton. Gentleman's time has expired. Mr. Bilirakis.
Mr. Bilirakis. Thank you Mr. Chairman. I appreciate it very
much. Thank you, Madam Secretary, for testifying today.
Madam Secretary, over the weekend, The New York Times wrote
the following: ``Project managers at the Department of Health
and Human Services assured the White House that any remaining
problems could be worked out once the Web site went live, but
other senior department officials predicted serious trouble and
advised delaying the rollout.''
Can you confirm if this is true? Did any senior department
officials predict serious problems, and did any senior
department officials advise delaying the rollout of the
exchanges or parts of the exchanges on October 1st? Can you----
Secretary Sebelius. I can tell you that no senior official
reporting to me ever advised me that we should delay. You heard
from the contractors on the 24th that none of them advised a
delay. We have testing that did not advise a delay. So, not to
my knowledge.
Mr. Bilirakis. Did they indicate to you that there were
serious problems?
Secretary Sebelius. They indicated to me that we would
always have risks, because this system is brand-new and no one
has operated a system like this before to any degree. So we
always knew that there would be the possibility that some
things would go wrong. No one indicated that this could
possibly go this wrong.
Mr. Bilirakis. Can you name some of these officials that
gave you that advice that there were serious problems?
Secretary Sebelius. Again, we had a series of meetings with
teams from CMS. I was always advised that there is always a
risk with a new product and a new site, but never suggested
that we delay the launch of October 1st, nor did our
contracting partners ever suggest that to us.
Mr. Bilirakis. Thank you. Thank you, Madam Secretary.
Thank you, Mr. Chairman. Appreciate it. I yield back.
Mr. Upton. Mr. Johnson.
Mr. Johnson. Madam Secretary, thank you for being here with
us today. CMS was the integrator of the Web site prior to and
leading up to the 1 October----
Secretary Sebelius. That's correct.
Mr. Johnson [continuing]. Rollout, correct? You've
testified that you've now hired an outside company to serve as
the integrator. Who is that?
Secretary Sebelius. One of our contractors is taking on an
additional----
Mr. Johnson. Who is that?
Secretary Sebelius. QSSI----
Mr. Johnson. QSSI.
Secretary Sebelius [continuing]. Who built the hub.
Mr. Johnson. OK.
Secretary Sebelius. Yes, sir.
Mr. Johnson. This is the same company that told our
committee last week that they were not only the developer of
the hub and the pipeline, but also an independent tester of
system?
Secretary Sebelius. Yes.
Mr. Johnson. You've acknowledged in your testimony today
that inadequate testing played a significant role in this
failed launch, so aren't you concerned that QSSI has lost its
ability to be an objective independent arbitrator in addressing
the problems that plague the system now, because they're part
of the tester, part of the developer, part of the problem?
Secretary Sebelius. No, I haven't lost my confidence in
them. I think the testing that they did is validating the
pieces of the equipment. What we've said since the launch is
that we did not do adequate end-to-end testing.
Mr. Johnson. OK.
Secretary Sebelius. That was not the QSSI responsibility.
Mr. Johnson. All right. And in this new role as integrator,
are you going to be paying QSSI more than they were to be paid
under their original contract? I would expect with this
expanded role, they're going to get paid more. Right?
Secretary Sebelius. That discussion is underway in terms of
what the role will entail, what the outlines are, yes, sir.
Mr. Johnson. OK. Well, hardworking American taxpayers have
already paid for this implementation once. Do you think it's
fair to ask taxpayers to pay more so that QSSI can now attempt
to do something that Administrator Tavenner and her CMS team
were unable to do right the first time?
Secretary Sebelius. Well, sir, I think the American
taxpayers expect us to get the site up and running. As I told
you earlier----
Mr. Johnson. Well, I'm certain that they did. They expected
it the first time.
Secretary Sebelius. I understand. And so did I. We have not
expended the funds that have been encumbered for the contracts.
Mr. Johnson. You know, we----
Secretary Sebelius. We have not----
Mr. Johnson. Madam----
Secretary Sebelius. And we will monitor every dime we spend
from here on in and re-audit things that are going forward.
Mr. Johnson. Well, with that, Mr. Chairman, I yield back.
Mr. Upton. Gentleman yields back. Mr. Long.
Mr. Long. Thank you, Mr. Chairman. And thank you,
Secretary, for being here today and giving your testimony.
Earlier today you said that, I'm responsible for the
implementation of the Affordable Care Act. I've heard you
referred to, and maybe yourself, as the point person for the
rollout, the architect of implementing the Affordable Care Act.
So you are kind of the President's point person, are you not,
for this rollout?
Secretary Sebelius. Yes, sir.
Mr. Long. Earlier you were asked--and there's a lot of
things striking about the rollout of this and about the
Affordable Care Act altogether, but the thing that's most
striking to me is that when we have the point person for the
rollout here and you're not going into the exchange--now, I've
heard you say that--and you've got some advice from the folks
behind you, but I'm asking you today, can you tell the American
public, if your advisors behind you that if they happen to have
given you some wrong information, if it is possible for you to
go into the exchange like all these millions of Americans that
are going to go into the exchanges, will you commit to forego
your government insurance plan that you're on now and join us
in the pool?
Come on in. The water's fine. All the Congressmen, all of
our staff have to go into the exchanges. We have to go into the
D.C. exchanges. And I will say that I tried to get on the Web
site, I was successful during the hearing earlier, and I got to
the D.C. exchange, which is where I have to buy from. I got
part way through, and then when it got to the point to enter my
Social Security number, I could not bring myself to do that
from what I've heard from people like John McAfee and folks
about the security.
Will you tell--if your advisors are wrong and it is
possible for you, I'm not saying it is, but if it is, if it's
possible for you to forego your government program you have
now, will you tell the American public that, yes, I will go
into the exchanges next year like everyone else?
Secretary Sebelius. Sir, the way the law is written----
Mr. Long. It's a yes or no.
Secretary Sebelius. We have----
Mr. Long. Let's say that you're wrong on that. Yes or no?
If you're wrong----
Secretary Sebelius. I don't want to give----
Mr. Long [continuing]. Will you, yes or no?
Secretary Sebelius [continuing]. Misinformation to the
American public----
Mr. Long. You what?
Secretary Sebelius [continuing]. I don't want to give
misinformation.
Mr. Long. I want you to go home and research it----
Secretary Sebelius. If you have affordable----
Mr. Long. If----
Secretary Sebelius [continuing]. Coverage----
Mr. Long. If you're wrong----
Secretary Sebelius. If you have affordable coverage----
Mr. Long [continuing]. Will you go into the exchanges?
Secretary Sebelius. If I'm wrong----
Mr. Long. If you can, will you? That's a yes or no. If you
can, will you, ma'am?
Secretary Sebelius. I will take a look at it. I don't have
any idea----
Mr. Long. That's not an answer. That's not a yes or no.
Mr. Upton. Gentleman's time has expired.
Mr. Long. You're the architect of the whole program, and
you won't go into it with the rest of the American public.
Secretary Sebelius. I did not say that, sir. I think it's
illegal for me to----
Mr. Long. If it's not illegal. If it's legal, will you go
in?
Secretary Sebelius. If I have affordable coverage----
Mr. Long. Come in. The water's fine.
Mr. Upton. The gentleman's time has expired.
Mr. Waxman. I have a unanimous consent request. I'd like
to--Madam Secretary, I'd like you to answer for the record, if
you are able to do what the gentleman just suggested or follow
the recommendation of Cory Gardner, our colleague from
Colorado, and went in to buy an individual policy, would you be
able to find one that would protect you from cheap shots, or do
you think that it has to be mandated for coverage? I'll leave
the record open for your response.
Mr. Upton. We'll wait for that response to come back.
Secretary Sebelius. I'd gladly join the exchange if I
didn't have affordable coverage in my workplace. I would gladly
join it. And the D.C. market is an independent State-based
market, even though D.C. is not a State. We do not run the D.C.
market in the Federal marketplace.
Mr. Upton. The gentlelady from North Carolina, Ms.
Ellimers.
Mrs. Ellmers. Thank you, Mr. Chairman, and I have a couple
of questions. Thank you for being with us today, Madam
Secretary. I'd like to go to the issue that has been raised by
my colleagues on the left here about accurate information.
Number one, I've heard the issue of Medicare Part D brought up
many, many times. Although my colleagues all voted no against
it initially, now they're extolling the virtues of Medicare
Part D. Is Medicare Part D a mandate or is it voluntary?
Secretary Sebelius. It is voluntary.
Mrs. Ellmers. It is a voluntary program.
Secretary Sebelius. Yes.
Mrs. Ellmers. That's the first accurate piece of accurate
information I would like to get.
You know, we're actually forcing millions of Americans to
go to find a health care premium in some way, whether it's to
go to the exchange or whether they are to be insured. Many of
my constituents are reaching out to me, those with individual
policies, and they are saying to me that my rates are going up
400 percent, my rates are going up 127 percent. These are my
constituents. Now, we're talking about open enrollment, but
it's forcing the issue, is it not? That if an American does not
have health care coverage, they are essentially breaking the
law. Is that not correct?
Secretary Sebelius. If someone can afford coverage and has
that option and chooses not to buy coverage, they will pay a
fee on their----
Mrs. Ellmers. And that----
Secretary Sebelius [continuing]. Liability in their----
Mrs. Ellmers. And it is a law, so therefore they are
breaking the law.
Secretary Sebelius [continuing]. Next year's tax.
Mrs. Ellmers. OK. You also brought up the issue when you
were in Kansas, that you fought against discriminatory issues.
Now, as far as essential health benefits, correct me if I'm
wrong, do men not have to buy maternity coverage?
Secretary Sebelius. Policies will cover maternity coverage
for the young and healthy.
Mrs. Ellmers. Including men?
Secretary Sebelius. Under 30 years old will have so a
choice also of a catastrophic plan which has no maternity
coverage.
Mrs. Ellmers. The catastrophic, but men are required to
purchase maternity.
Secretary Sebelius. Well, an insurance policy has a series
of benefits whether you use them or not, and one of the
benefits will be----
Mrs. Ellmers. And that is why----
Secretary Sebelius [continuing]. Coverage for mental health
coverage----
Mrs. Ellmers [continuing]. The health care premiums are
increasing----
Secretary Sebelius [continuing]. Violence----
Mrs. Ellmers [continuing]. As high, because we are forcing
them to buy things that they will never need.
Thank you, Mr. Chairman.
Secretary Sebelius. The individual policies cover families.
Men often do need maternity coverage for their spouses and for
their families, yes.
Mrs. Ellmers. Single male age 32 does not need maternity
coverage. To the best----
Secretary Sebelius. He may not need----
Mrs. Ellmers [continuing]. Of your knowledge, has a man
ever delivered a baby?
Mr. Upton. Gentlelady's time----
Secretary Sebelius. I don't think so.
Mr. Upton [continuing]. Has expired. The gentlelady, Ms.
Cathy McMorris Rodgers.
Mrs. McMorris Rodgers. Thank you, Mr. Chairman. And Madam
Secretary, although we were told repeatedly that if you liked
your health insurance plan, you'd be able to keep it, we're now
being told by the government that they have determined many
existing plans to be lousy, subpar.
In reality, this law is becoming quickly less about helping
Americans purchase affordable coverage and more about
compelling millions of Americans into a struggling Medicaid
program. In my home State of Washington, 90 percent of
enrollees will be in Medicaid; 16,000 of them coming into a
program that they were already eligible for; Colorado, 89
percent; Kentucky, two-thirds; Maryland, 97 percent. And these
are States that are already struggling with their budgets,
wondering how they're going to cover Medicaid, which is, as we
all know, for the most vulnerable population.
So isn't it true that in States like Washington, they're
going to have new, unexpected costs associated with a dramatic
influx into Medicaid?
Secretary Sebelius. Well, Congresswoman, the Medicaid
expansion provision of the Affordable Care Act is----
Mrs. McMorris Rodgers. Are States going to face new costs--
--
Secretary Sebelius. The Federal Government pays 100 percent
of the costs of newly insured for the first 3 years and
gradually reduces----
Mrs. McMorris Rodgers. These are existing----
Secretary Sebelius [continuing]. That cost to 90 percent.
Mrs. McMorris Rodgers. These were people that were already
eligible.
Secretary Sebelius. Well, existing people were----
Mrs. McMorris Rodgers. And we know that two out of three
doctors don't accept new Medicaid patients, we know that
current provider rates are going to drop at the end of 2014. So
isn't it true that existing Medicaid enrollees are going to
further compete for scarce resources in these States?
Secretary Sebelius. If the citizens of Washington who are
signing up were eligible for Medicaid, they certainly will be
entitled to enroll in Medicaid now. The newly insured will be--
--
Mrs. McMorris Rodgers. I'm concerned----
Secretary Sebelius [continuing]. Fully paid for. The
doctors have additional fees.
Mrs. McMorris Rodgers [continuing]. That the most
vulnerable in this country are going to lack access to the care
that they they're going to receive. And I know time is short,
Madam----
Secretary Sebelius. Well, I think that's absolutely true.
And in States that are choosing not to expand Medicaid, it's
particularly dire.
Mrs. McMorris Rodgers. It's----
Secretary Sebelius. So I would love to work with you on
that----
Mrs. McMorris Rodgers. It's existing Medicaid.
Secretary Sebelius [continuing]. Expansion.
Mrs. McMorris Rodgers. And finally, I just wanted to inform
the Secretary, you told us several hours ago when the hearing
started that the Web site was down. If you look at the screen,
several hours later, HealthCare.gov is still down. You promised
this system would be ready on October 1st. You're clearly
wrong.
So before I leave you today, I would just impress upon you,
this is more than a broken Web site. This is a broken law.
Millions of Americans are getting notices their plans are being
canceled. I yield back my time.
Mr. Upton. Gentle----
Mr. Waxman. Meh, meh, meh.
Mr. Upton. Gentlelady's time has expired.
I would do a couple things here. First I'm going to ask
unanimous consent that the written opening statements for any
member on the committee be introduced into the record. And
without objection, the documents will be there. I also would
ask unanimous consent to put the document binder and other
documents presented to the Secretary during questioning into
the record without objection. So ordered.
[The information appears at the conclusion of the hearing.]
Mr. Upton. Let me just say in conclusion, we do look
forward to having you back in December to get an update on
where we are, and we'll work with your schedule to find a right
time and date early that week. I want you to know, we're going
to want real numbers. You will have them by then, is that
right, in terms of the signup? You'll have them in the next
couple of weeks, so----
Secretary Sebelius. That's correct. We'll have them by mid
November.
Mr. Upton. We look forward to getting those done. We
appreciate, we really do appreciate your time this morning to
take questions. And I apologize to all the members who we had
to shorten the time, but those things happen when we have this
much interest. We look forward to continuing to get an update
and look for your continued work.
Mr. Waxman. Mr. Chairman, and----
Mr. Upton. Yes.
Mr. Waxman [continuing]. From our side of the aisle, we
want to work with you. And I would hope on the other side of
the aisle, they would take that same approach. Let's do
something constructive, not just negative attacks against a
bill that I think is going to be a Godsend for millions of
Americans. Thank you for being here.
Secretary Sebelius. Thank you.
Mr. Upton. Thank you. The hearing is adjourned.
[Whereupon, at 12:40 p.m., the committee was adjourned.]
[Material submitted for inclusion in the record follows:]
Prepared statement of Hon. Marsha Blackburn
For four years, the president told Americans that if they
like the health insurance plan they have, they can keep it. The
facts today show this is not the case. Everyday, my office gets
letters from constituents letting us know they have been thrown
off their current plan. Adding insult to injury, the Web site
to buy one of the presidents plans doesn't even work. For those
that are able to get through, many are finding their premiums
going up, not down. The botched rollout of this law simply
confirms everyone's worst fears about government run health
care. If they government can't figure out how to run a Web
site, how will they be able to figure out how to take care of
us. Today we continue our investigation into these issues of
behalf of all Americans whose lives are affected by this law.
# # #
----------
Prepared statement of Hon. Greg Walden
Thank you, Mr. Chairman and Ranking Member, for holding
this very important hearing. The fact is that the rollout of
healthcare.gov has been a failure at every turn. The federal
exchange still isn't working for millions of Americans who
visit the Web site trying to enroll. In my home state of
Oregon, our state run exchange, Cover Oregon, still hasn't even
gone online. A month after they were supposed to be up and
running, they have yet to sell even one single private
insurance policy through the exchange Web site.
But what's most troubling is that Obamacare isn't just a
Web site. In fact, the Web site is supposed to be the easy
part. And now, we're seeing more and more cracks in the
foundation. This administration promised, in unequivocal terms
that, ``If you like your doctor, you will be able to keep your
doctor, period. If you like your health care plan, you'll be
able to keep your health care plan, period. No one will take it
away, no matter what.''
Despite White House rhetoric, millions of Americans are
receiving cancellation notices in the mail. In Oregon alone,
150,000 people are losing their insurance plans. Health
insurance they liked and that their President promised they
could keep. I've heard from dozens of people living in Oregon's
Second Congressional District who are now struggling to make
ends meet because their premiums are doubling, their
deductibles are going up, and they're getting worse coverage
for it. It's just another broken promise from the
administration.
And the problems don't end there. What's next? What new
hurdle is about to be thrown in the way of the American people?
For one, the Affordable Care Act required the Centers for
Medicare and Medicaid Services (CMS) to rebase home health
payments. The stated goal was to align payment with costs. The
law gave CMS the authority to rebase the payments by as much as
3.5 percent per year from 2014 through 2017. Rather than
implement these cuts gradually seeing the effect as they go--or
on a year by year basis, CMS regulations recommend payments be
rebased by the full 3.5 percent every year for all four years.
Taken as a whole, these cuts result in a 14 percent cut to
Medicare home health payments.
These policies might seem like something done in a vacuum
to bureaucrats in D.C. But they have significant and lasting
effects for people living in the real world. My home District
is 70,000 square miles. We stretch across a distance roughly as
far as Cincinnati to Baltimore. We're mountainous, we're rural,
and some counties are without a physician, let alone a
hospital. For the Oregonians I represent, access to home health
providers is crucial.
My family and I have seen first-hand the powerful impact
that compassionate and highly skilled home health nurses
provide. We've used it with our own loved ones and know how
meaningful it is to be able to recover at home, in familiar
surroundings, with your family by your side. It would be
devastating for the people in Oregon's Second District--and
throughout rural America if these services were no longer
available to them.
Unfortunately, the Affordable Care Act could limit access
to home health. CMS's cuts to home health would result in
negative Medicare margins for home health care providers in
nearly every single state. Oregon's margins would fall to
negative 26.5 percent.
I was one of 142 members of the House who sent a letter to
Administrator Tavenner expressing our concerns about this very
issue back in September. To date, we haven't heard back. But
this issue is not one that is going to go away. As we move from
one crisis point with the flawed implementation of the
government takeover of health care to the next, this issue
will, inevitably, come to the forefront. Too many of our
nation's seniors and rural residents depend on the
availability, reliability, and affordability of home health
care services.
Thank you again Mr. Chairman and Ranking Member. I look
forward to hearing what the administration plans to do to
protect Americans from a fatally flawed law that reduces access
to health care, increases costs, cuts Medicare, and puts a
barrier of government red tape between patients and their
doctors.
----------
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