>> the president's nominee for the next administrator for centers for medicare and medicaid services said all options should be considered to improve program quality and financial stability. seema verma testified in a three our confirmation hearing yesterday. [inaudible conversations] the committee will come order. i would like to welcome everyone to this morning's hearing. today we consider the nomination of seema verma to service administrator of the centers for medicaid, medicare and medicaid services. we are so happy to have you here and your family too. appreciate your willingness to meet at the agency on this article time. i see your family has joined you today to lend support so i extend a warm welcome to all of you and them as well. cms is the world's largest health insurer covering over one third of the us population through medicare and medicaid alone. it has a budget of over $1 trillion and processes over 1.2 billion a year for services provided to some of our nation's most vulnerable citizens. seema verma having dealt with cms extensively as a consultant to numerous state and medicaid programs, you know well the challenges, agency deals on a daily basis. i suspect you also -- it is a thankless one. fraught with numerous challenges. there are opportunities in those challenges and i believe they are the right person for the job with most of those opportunities to improve our health care system. the failings of obamacare are urgent and must be addressed in short order. for the past six years we have watched as the system created under obamacare increased costs, higher taxes, fewer choices, reduced competition and put more strain on the economy. health insurance premiums are up by 25% this year alone. under obamacare, billions of middle-class americans have been hit by new taxes. under obamacare major insurers are no longer offering coverage in exchanges, and another major carrier will exit the market in 2018. as congress works to change course with regard to our ailing healthcare system cms will play a major role in determining our success was i applaud the step the agency took under the leadership of secretary price with the poseable with its proposed to stabilize the individual insurance markets but there is more work to be done and i'm confident if you are confirmed and i expect you to be you will be a valuable voice in driving change. i would like to talk about medicaid for a moment. the medicaid program was destined to be a safety net for the most vulnerable americans. as such i understand the moral and social responsibilities the federal government has in ensuring health care coverage for our most needy citizens. i'm committed to working with state and other stakeholders as i think everyone on this committee is and the american public to ensure the longevity of the medicaid program. we must also acknowledge the medicaid program is three times larger in terms of enrollment and expenditures than it was 20 years ago. additionally the medicaid expansion exacerbated pressures on the program at a time many states were facing difficult choices about which benefits and populations to serve. as a result we have a responsibility to consider alternative funding arrangements that could help to preserve this important program. we also need to consider various reform proposals that improve the man that is the way medicaid operates. we need your assistance in both of these efforts and your experience in this area should serve you well. on the subject of the experience for the committee, she has been credited as a creative force behind the healthy indiana plan, the state's medicaid alternative. this provides access and quality healthcare to its enrollees while ensuring they are engaged in their care decisions. it evolves while hitting key metrics overall. with their experience as i understand it. major criticisms from the other side of the dais, we should note hhs and cms leaders under the obama administration repeatedly approved the waiver necessary to make this program a reality. seema verma has assisted a number of other medicaid programs as well. her efforts all have the same focus, getting needed high-quality healthcare to engage patients in a fiscally responsible way. this is exactly the mindset you need in a cms administrator. seema verma, challenges associated with medicaid are not enough to keep you busy. as cms administrator, you will also be tasked with helping to ensure the longevity and solvency of the medicare trust fund which is projected to go bankrupt in 2028, already down 2032. all told, between now and 2030, 76 million baby boomers will be eligible for medicare. even factoring in deaths over that time the program will grow from 47 million beneficiaries today to 80 million in 2030. maintaining solvency of the medicaid program to provide character and beneficiary base requires creative solutions. it will not be easy, we cannot put it forever. and they will speak more generally along recent events. as we dealt with president trump's nominations. in the details of the past -- i will say recent developments do not become the new normal for our committee. as i said before i will do all i can to ensure and maintain customers of this committee which is already operated with assumptions of bipartisanship and good things with regard to considering nominations, that means a robust and fair vetting process. a rigorous discussion among committee members in an executive session. on that note maybe the treatment of nominees has started to fall today. at least i hoped tradition that has been absent before the session has been the introduction on many occasions of nominees by senators, from the nominees home state especially in cases where the nominee and home state senator having a relationship, i am pleased to say the senior senator from indiana in that condition by appearing here today and so is our other senator. i think the senators for taking time to appear today and introduce their constituent. i will give them a chance to do so in a you minutes. with that i look forward to sharing her vision and views here today and look forward to what i hope will be a full and fair committee process that allows us to process this nomination and report it to the full senate in short order. i will at this time recognize my cochair on this committee for his opening statement. >> thank you, mister chairman and welcome to you, seema verma, i thought it was worth noting the hoosier basketball tradition looks like you have brought close to two slides of basketball players and we welcome you and your family today. it is obvious the healthcare posts we are going to discuss today are not exactly dinnertable conversation in much of america but the fact is it is one of the most consequential positions in government, agencies responsible for the health care of 100 million americans who count on medicare and medicaid plays a key role in implementing the affordable care act. that is why cms needs experience to qualify people for the job who know the ins and outs of the whole system, medicare, medicaid and insurance. the agency needs a strong and experienced authority and this is particularly true now when it does appear some of my colleagues on capitol hill and in the administration are looking to make radical changes in american health care. in my view many of these proposals will take the country back to the days when healthcare was mostly for the healthy and the wealthy. we are going to start with the promise of medicare which has always been a promise of guaranteed benefits. that makes up more than half the agency spending, about $2 billion a day, more seniors entering the program each year, an awful lot to protect and in my view, update the medicare guarantee, that means addressing high cost of prescription drugs and making the program work better for chronic illnesses, the majority of medicare spending. takes bipartisan support. it is the wrong direction to privatize medicare in my view. it is important to hear today, from policymaker's for advocating those approaches to be interested in turning the program into a voucher. additionally if confirmed, they will play a key role implementing the payment reforms, essential that they be implemented by the -- move healthcare paying for volume. and the private insurance market and many of those amounts to bedrock values. it means not discriminating against those with preexisting condition. it means setting the bar for the medicare insurance companies. and letting young people stay on their parents policy until 26. unfortunately just yesterday the agency, a proposed will. and from where i sit the message from yesterday's rule, insurance companies are back in charge and patients take a best -- backseat. the open enrollment period was cut in half, and somebody dropped coverage during the year, insurance companies collect that premium before an individual for health insurance again and insurance companies, free reign to offer less generous coverage, the same or higher cost. it is going back to yesteryear when the health care system did work for the healthy and wealthy. the administration saying the best is yet to come. evidence suggests otherwise. they have taken steps to create more stability on a bipartisan basis. and obviously creating market uncertainty and anxiety looking farther than humana's decision. and how you are going to implement the program that millions of americans count on. and it goes beyond disrupting the individual market. and this is an area where you have extensive experience was i want to discuss the trade-offs associated with those efforts and particularly concerned about the possibility somebody making barely $12,000 a year from health coverage for no less than six month due to an upcoming rent check. there is an independent evaluation indicating people bumped from coverage, and the same report that 20,000 persons and comprehensive medicaid problem to navigate the system you all put in place. i want to wrap up two last points. with respect to taking these ideas on a nationwide tour, i am not there yet. i say that respect only, here is the point with respect to states, we touched on it in the office was we authored section 1332 of the affordable care act saying states can do better, states have an idea, better coverage, lower cost, we are for it. for the states to do worse. one last issue that i want to touch on deals with seema verma's work. you have consulting firms that were awarded, contract directly by the state to advise the state and that was by managing programs. at the same time as has been told to me you contracted with five other companies providing hundreds of millions of dollars of services and products to these programs, hp enterprises, health management associates, rose diagnostics and these firms determine the state contract appear to have had in effect overseen work that is performed. george w. bush had an ethics lawyer named richard paynter. and he said yesterday this arrangement clearly should not happen since it is definitely improper. he said you were on both sides of the deal managing by vendors to the same programs. he said that was a conflict of interest. i want to hear you respond to his assertion. we know more about your work for companies and business with the state and one of the questions will be if you are the cms administrator would you recuse yourself from decisions that affect the company or her clients. i look forward to your testimony with the two indiana senators, very proud, thank you, mister chairman. >> pleased to hand over my normal witness introduction duties today to a pair of distinguished colleagues that no senators from the hoosier state -- a statement and testament to her work to her as a person. i asked the senior senator from indiana, mister donnelly, start the introduction to senator young. go ahead and proceed. >> ranking member wyden, chairman hatch, members of the committee, thank you for inviting me here today. it is a pleasure to be here with my friend and colleague, senator todd young to recognize this important accomplishment of a fellow hoosier. anytime the president nominates an individual for leadership position in our government it is an honor of the trust and respect he has for that person. for this reason i am pleased to be here today, for the nomination for the next administrator for the centers for medicare and medicaid services and introduce her to this committee for consideration. and we accomplish more when we work together. in working collaboratively to help hoosiers get access to quality healthcare is something seema verma and i have done together. he has played a central role in crafting medicaid policy including our own. and in federal partners to take advantage of opportunities by the affordable care act to expand medicaid to the healthy indiana plan also known as tip. and the uninsured rate, improve healthcare outcomes and played a critical role in combating the opioid abuse and heroine epidemics. hundreds of thousands of hoosiers have health insurance through hip 2.0, the program is an example of what is possible when we work together. as i shared with seema verma and i will share with you i'm concerned about the future of healthcare in our country as well as the rhetoric surrounding the current debate. and medicaid and other care, building upon the progress of the aca, is fundamental to the financial well-being of thousands of americans across the country. it is my fear hope this administration working with this committee and others will approach medicare and medicaid with a thoughtful and pragmatic consideration these critical programs deserve. i watched seema verma take this common sense hoosier approach and hope there's an opportunity to share her vision how she can work together with all members of this committee and congress as a whole to expand access to quality healthcare and protect and build on the progress we have made over the last several years. with that, ranking member wyden, members of the committee, thank you for allowing me to introduce seema verma. to seema verma and her family congratulations on this tremendous honor. .. this arguably the most important office within the hhs. an office that covers the health care needs of over 100 million americans . the budget of almost $1 trillion. you heard that 20 year career as an innovator in healthcare sector, she's worked extensively with a variety of stakeholders , both sides of the aisle to deliver better access to healthcare. the president, ceo and founder of sdc she helped several states redesign their archaic medicaid system. including in my home state of indiana. fema revolutionized the medicaid program as our healthy indiana plan which we know as it. the nation's first consumer driven directed medicaid program. she transformed a complex medicaid system into one where hoosiers are back in control of their healthcare needs. since 2007, hipp has achieved impressive results. seniors are more likely to seek preventative care, keep their prescriptive medication and seek primary care services as their physician's office, not the emergency room. fema's innovative ideas work is now in a group of concepts that medicare can be more efficient than a one-size-fits-all approach. she accomplished this with the support and buy-in from people again on both sides of the aisle and at all levels of the process. by putting the mission above politics, she demonstrated a willingness to work with anyone . anyone who was willing to do the same. she worked with democrats in the indiana state house, she worked with the obama administration to find common ground on how to best provide quality health care for hundreds of thousands of low income hoosiers. and it worked. as cms administrator, fema will have the ability to do extensive experience to help other states achieve what we have in indiana. better health outcomes for our most vulnerable. i look forward to working with her. and thank you sir.>> welcome to both of you center, such a real honor. i wrote this down but i know i remember, we know you are busy so we will let you go. mister furman, we're now going to turn to you for your feelings on this nomination and then we will turn to questions. >> good morning chairman hatch, ranking member wyden. i appreciate and then grateful for your consideration of the nomination president trump to be the administrator for the centers for medicare and medicaid services and i thank you for the time that many of you have spent with me in advance of the hearing and i appreciate hearing about your priorities. before i begin my statement i would like to take a moment to introduce my family. me or my parents, mister and mrs. brenda and my husband and my two kids my and sean. and the rest of my family and friends that are here with me, i appreciate it. thank you. i've often been asked by my family and friends as well as many members of this committee why i would be interested in this job. i was honored and humbled and accepted president trump's call to service because i understand what is at stake. i have never sat on the sidelines of our nation's health care debate, merely pointing out what is wrong with our healthcare system. more than 20 years ago when i graduated from college, i started my career working on national policy on behalf of people with hiv and aids as well as for low income others to improve outcomes. i thought the coverage, greater healthcare actors access and improving quality of care and a continue to fight for these issues for the past 20 years.but i am deeply concerned about the state of our healthcare system and there's frustration all around. many americans are not getting the care that they need and we have a long way to go in improving the health of americans. doctors are increasingly frustrated by the number of costly and time-consuming burdens. healthcare continues to grow more and more expensive and the american people are tired of partisan politics. they just want their healthcare system to be fixed. and i know this not simply because i've worked in healthcare but because of how intimately it has affected my own personal life. my mother is a breast cancer survivor due to early diagnosis and treatment. and a few years back, my neighbor aiden was diagnosed with a stage iv neuroblastoma. she was only four years old. a large tumor has been growing for some time, maybe since he was born and it was all around his kidney. aiden went through excruciating chemotherapy, radiation, stem cell treatment and surgery, all experimental. this may, aiden will celebrate his 12th birthday. with both my mom and aiden are testament to the grace of god and the ingenuity of the american healthcare system. this is why people travel from all across the world to get care in the united states. i want to be part of the solution, making sure that the healthcare system works for all americans. so that families like my own and aiden's have the care that they need. i want to be able to look my children in the eye and tell them that i did my part to serve my country and to have a voice for people that don't often have one. this is a formidable challenge. i am no stranger to achieving success under difficult circumstances. my father left left his entire family to immigrate to the united states in the 1960s and pursued four degrees while working. to earn money. >> my mother's side, my grandmother married at the age of 17 with no more than a great education. but my mother went on to be the first woman in her family to finish a masters degree. my parents made a lot of sacrifices along the way to provide me with the opportunities that they didn't have and it taught me the value of hard work and determination. >> i'm extremely humbled as a first-generation american to be sitting before this committee after being nominated by the president of the united states. it is a testament to the fact that the american dream is very much alive for those willing to work for it. and it is my dream and my passion to work on the front lines of healthcare to improve our system. >> throughout my career, i have brought people together from all sides of the political spectrum to forge solutions that work for everyone. one of my proudest moments in my career was watching the indiana legislature passed a healthy indiana plan which is a program uninsured with a bipartisan vote. cms is a $1 trillion agency that covers over 100 million people. many of whom are amongst our nations most vulnerable citizens. providing high quality, accessible health care for these americans is it just a luxury, it's a necessity and often a matter of life and death. should i be concerned? i will work with cms teams to ensure that the programs are focused on achieving positive health outcomes and improve the health of the people that we serve. to achieve this goal, i will work toward policies that foster patient centered approaches that increase competition , quality and access while driving down costs. patient centered doctors should be making decisions about their healthcare, not the federal government. we must find creative ways to empower people to take ownership for their health. we should support doctors in providing high quality care to their patients and ensuring cms rules and regulations don't drive doctors and providers from serving our beneficiaries. if confirmed, i will work towards modernizing cms programs to address the changing needs of the people they serve, leveraging innovation and technology to drive better care. i will ensure that efforts around preventing fraud and abuse our priority because we can't afford to wait a single taxpayer dollars. i will work towards ushering in a new era of state flexibility and leadership to drive better outcomes. if i have the honor of being confirmed, i will carry this decision along with my strong belief in open communication, collaboration and bipartisanship. i will work with you, and be responsive to your inquiries, concerns and value your counsel. i thank you for the consideration of my nomination. >> as you so much, we appreciate your willingness to serve. >> and i look forward to getting used to this process. let me just answer some obligatory questions to give you, first is there anything you are aware of in your background that's been a conflict of interest with the duties in the office to which you have been nominated? >> that would be consulted with the office of ethics and have indicated any areas i thought would be an issue and i will be recusing myself of any matters that would present a potential conflict. >> you. you know of any person or any reason personal or otherwise that would in any way prevent you from honorably discharging the responsibilities of the office to which you have been nominated. >> i do not. >> you agree with out reservation to respond to any reasonable inquiry, pc area if i'm getting these pages apart. >> any reasonable summons to appear and testify before any duly constituted committee of the congress, if you are confirmed? are you willing to do that? >> i'm willing to do that. finally, you commit to provide prompt response in writing any questions visited to you by any center on this committee? >> i do. >> do. just some questions, i know you are aware of the historic bipartisan health care access and hit reauthorization act. i had a lot to do with 2015 or was called macro. among other things, the law got rid of the sdr formula neighbors improvements how medicare pays physicians. i'm pleased that our work on implementation continues to be bipartisan. both in how republicans and democrats in the congress have worked together and how congress can work with the obama administration. in fact, the obama administration did great things to engage physicians and other stakeholders through the initial implementation phase. it strikes me this process of consultation early and often could be the rule and not the exception. what is your view on how to engage stakeholders to approve and to arrive at the best policy decisions with medicare and other cms programs? >> thank you senator and i applaud congress efforts to pass, i think it's an important step forward not only to providing more stability providers but also moving us towards better outcomes. in terms of stakeholders, i think that the most important thing we can do is engage with stakeholders as quickly as possible on the front end and all the way through the process, understanding stakeholder perspective and what folks are going through on the front end, what their challenges are. as we are developing policies and programs to have that open communication, i think it's helpful towards any successful implementation. it's not a one time thing, not just on the front end, it's all the way through the process and even through the programs established, it's important to have a dialogue with stakeholders that they can tell you what's working and what's not working and when you think of new ideas and implementing them, they can help you figure out whether it's going to work or not. i know i had that experience in my career and i found very helpful and an integral integral part of success. >> as the baby boomer generation ages, and other persons age 65 and older in the united states with respect to dramatically increase, only an increase in the demand for long-term services and support, notably the primary payer of these services, what changes if any should be made to meet the expected increase in demand while ensuring the fiscal sustainability of the medicaid program? >> i think medicaid is a very important program. it's been a safety net for so many vulnerable citizens. when i think medicaid programs, i think of some of the individuals that i've met, one person in particular i think about is a quadriplegic . he's on a breathing machine and he requires 24 hour care. think about the mother of a disabled child and this is the face of the medicaid program. we think about medicaid program and where we are today, i think that we can do better. we have the challenge of making sure that we are providing better care for these individuals. but the program isn't working as well as it can. it's a very intractable program, it's inflexible. it's in a situation where they are having to go back and forth filling out reams of paperwork trying to get approvals from the federal government at the end of the day, are we achieving the outcomes we want to achieve? as i think about the medicaid program, i think there's an opportunity to make that program work better so we are focusing on improving outcomes for the individuals served by the program. >> in 2014 i worked closely with senator dryden and leaders through the house ways and means committee to enact a bipartisan law called approving medicare, let me see here. >> improving medicare post care transformation or impact. the impact act serves as a critical building block to achieve future medicare quality measurements and attain reform, specifically the fact that requires the collection of standardized data to help medicare not only compare quality across the different settings but also improve hospital and post discharge planning. our goal was to produce data-driven evidence that congress could use to debate the best ways to align medicare with payments. and improve patient outcomes and save taxpayer dollars. our moment is to ensure that we are able to do this by this type of thing. i want to ensure that beneficiaries are receiving the highest quality care services in the right setting at the right time. now, will you commit to working with me and members of congress and this committee and the provider community on the implementation of the effect? >> it would be my pleasure to work with the committee, stakeholders and anyone else interested to make that program a success. >> thank you, let's go to senator wyden. >> thank you for your testimony. i want to start with a comment you made that you are committed to cover which of course is what this is all about. unfortunately, what i've seen since the beginning of the year is basically been about rolling back coverage and in fact, congressman price back in your seat a couple weeks ago refused to commit to making sure that no one would be worse off in terms of coverage. now, the president said in his campaign and i'll quote, were going to have insurance for everybody. the american people are going to have rate healthcare, much less expensive and much better. >> that's what the president said. yesterday, cms did the exact opposite. the first rule to come out of the agency, the agency that you would like to head after secretary price was confirmed meant less coverage, higher premiums and more out-of-pocket cost for working families. how would you square what president trump said in his campaign with what cms did yesterday? >> in terms of the role that you speak of, i had not been involved in the development of that role out of respect for the committee and for the nomination process. i've not been involved in that, i've not been cms, i haven't been involved in that and can't that but what i can tell you is i am committed to coverage, i've been fighting on this issue for 20 years and i will continue to do that if i'm confirmed. >> i just read you quote, it's not like atomic secrets or classified materials. what the president said is very different than what cms did yesterday and you read the newspapers, you are an informed person. you talk about cutting the enrollment period, i'm looking at the headline. but the enrollment c-span in half. which really is going to limit our ability to get great people we need most, the younger healthcare people. >> one more time, how would you square what the president said with what happened yesterday. >> i think the president and i are both committed. i cannot the rule, i have not had an opportunity to review that. but again, i think the president and i both agree that we need to fight for coverage and make sure that all americans have access to affordable, high-quality health care. >> but what troubles me about yesterday, once again, insurance companies are coming first. patients come later. tell me one thing you would change to put patients first. >> something i would do is i think it's very important is that patients being charged on their healthcare, that patients drive the decisions about their healthcare, that they get to make the choices about what kind of healthcare plan works well for them. i think it's important that our patients have access to quality coverage, to the doctors, to their choice of doctors and their choice of plans. >> can you get us specifics on that because that's an admirable philosophy. i still don't know, yesterday was good for insurance companies.but it was bad for patients.i'd like to have the specific example and we will keep the record open of something you would do to put patients first. and i respect the fact that you've articulated a philosophy. i really want to know what's specific about what you would do to put patients first. let's move on with respect to another area of responsibility you will have and that's prescription drugs and medicare . we all know that these prescription costs are just clobbering families. the federal government has spent a whole variety of stakeholders that they referred to as the administrator of the agency, you will have an opportunity to address this problem. again, give me a specific change to medicare part d that you would suggest to bring us down. >> i think the issue of drug pricing is something that all americans are concerned about and the president is concerned about that as well. people want to make sure that when they need the drugs, when they are going through an illness, i think about my neighbor aiden and we may need the drugs that they need and want to know that they have access to it and that's affordable. i think we are all concerned about that specific issue. part d i think has been a good program. it has expanded access to medication for people that didn't have it before. and i think the structure of the program in terms of how to put senior citizens in charge of their healthcare , they can go on plan fighter, go online. >> my time is up, i voted for party. , i've got the wealth to show for it. i asked you for specific change going forward. that you would do to help seniors and others hold down their costs. did you know there's discussion of making changes so that medicare can bargain, is there one specific you can give me and the reason the medicare question is so important is not only does this affect other people so dramatically but your experience is on the medicaid side, and i respect that. people have their experiences. so i very much would like to hear a specific on this key medicare issue that you would actually before. >> i would be for policy that continued to put senior citizens in charge of their healthcare. that puts them in the driver's seat of making the decisions that work best for them so that they can figure out what plan covers the medications that they need. what plan is affordable for them and allows them to make decisions about their health care and gives them access to the medications they need, that doesn't limit that in any way and that is affordable to them. >> my time is expired.i still didn't get the specific example. i have to be for a host of things in transparency, on negotiation. on trying to make sure that we squeeze more cost savings out of the middlemen.and that holds the record open but i ask you for specifics into areas, putting patients first and how you would hold down the cost and respectfully, i didn't get the specific hold the record open for it. i think grassley, are you going to call out names on your side were ... >> that didn't take much time. >> when i'm going to talk to you about is things that happened in cms in the past. and hopefully, the incoming administration that wants to drain the swamp, i think i would expect changes to be made under your leadership and this agency. and i would suggest that you probably can't do anything about the suggestion i'm going to give you to respond to the last question of my colleagues but if you would push doing away with pay for delay programs, between dogs and generics, that would go a long way to helping get cheaper. cms has told me that it does not have much authority to do anything about some frauds committed against this program. even if those actions are in cms own words, a clear violation of the law.and common sense tells me that it was a clear violation of the law, cms can do something about it and if that's their attitude, i would ask you to see whether the past interpretation is right by checking that interpretation. but in the january 28 letter to me of the medicare drug rebate program, cms said it could tell, could manufacture when this drug is misclassified and then on quote, attempt to reach an agreement. in other words, after the monies been stolen on the taxpayers, take some trouble to get back if you can reach an agreement. but there are a lot of tools that the government has to fight fraud. and the most effective one we have is the false claims act. since 1987 when i got that law in place, with the department of justice is used false claims act to recover more than 33 9/10 billion dollars , just lost from just a healthcare fraud globally. the cooperation between the department of justice and healthcare program administrators is very important in these cases. it seems like cms could at least have picked up the phone and given the department of justice a heads up when these manufacturers refused to cooperate and properly classify their drugs so it's a pretty simple question and it might even be called a softball question but it's pretty important to me, would you commit to proactively cooperating with the department of justice in fraud cases and to fully supporting the use of the false claims act to combat fraud on government healthcare programs. >> absolutely i will do that and i applaud your efforts and i think it's been an integral component of preventing fraud and recovery dollars when the restaurant so i thank you for your service and your work on that. >> next question. in the fall of 2016, and in january 2017, i said several oversight letters to cms regarding the steps that took the hold mile and accountable for misclassified the epipen as a generic under the medicaid drug rebate program. cms has publicly stated that quote, expressly advised my land that their classification has been for purposes of the medicaid drug rehab program was incorrect. however, cms has failed to fully respond to my oversight request and refuses to provide records of communication with my land. cms is also not entirely clear as to what the authority has to do with, to correct drug misclassification. because of epipen's misclassification, governments and states are owed hundreds of millions of dollars from mylan and the american people are road answers so if confirmed, would you commit fully responding to my oversight request and providing the request of communication beyond mylan and cms, i hope that's a short ask. >> that's a short yes. >> in light of epipen's misclassification and potentially other drugs that have been misclassified under medicaid, what steps would you take to ensure that drugs are properly classified under medicaid? >> i think what happened with the mylan and the epipen issue is very disturbing. the idea that perhaps medicaid programs, which are struggling to pay for those programs, that they could have potentially receive rebates is disturbing to me. so if i'm confirmed i would like to review the process in place there in terms of the classification. in terms of brand and generics to ensure that type of thing doesn't happen again. >> what you just said you want to do, i want to do and that's why i want this communication from cms, i hope you can get them. >> i'll be happy to work with you on that. >> center 70. >> that you very much and welcome to you and your family. the first thing, many many questions i have but first regarding medicare, you believe that medicare programs should negotiate the best price for seniors on medicare? >> i think that we need to do everything we can do to make drugs more affordable for seniors. and i'm thankful that we have the pbn's and part d programs that are performing that negotiation on behalf of seniors. >> you believe we could get a better price, negotiating as the va does, as other private entities do to get the best price for seniors? >> i think competition is the key to getting good prices. >> is that yes, sir no on negotiation? >> i don't think that's a simple yes, sir no answer because there are many ways to achieve that goal and the goal is to make sure we are getting affordable prices for seniors and if we look at the party program and the way the pbn has negotiated this, we know that there is a lot of competition, the price goes down so i think we have to figure out ways to work with you on about how we can increase our competitiveness and support the party program but what i like about the party program is that years in charge of making the decisions about the drugs they need. using the plan finder tool to go in there, they can put the medications they need. >> i'm going to stop because i don't have a lot of time. under the repeal of the affordable care act, actually seniors would begin to pay more because of the gap in coverage for those who can't using medicine. that would appear again so we've closed that gap for seniors and that would reopen. do you support that? as part of the repeal? >> as i said before, it's important to help seniors get the most affordable drug prices. >> that's returning to a gap in coverage, seniors under medicare part d? >> i support seniors having access to affordable medications and medication that they need that they choose. >> let me ask now about a little bit more on yesterday's decision regarding cns. one of the things that they decided to do yesterday was to cut in half the open enrollment period for people to be able to get insurance from three months to six weeks. you support that? >> i haven't had a chance to review that rule, i was not involved in the developmentof that . >> you think it's a good idea? does it seem like a good idea from your standpoint? >> i want to review the implications of that. it was not as i said before with respect to this process, i have not been to hhs. i've not been involved in the development of that rule. so i would look forward to reviewing that and would be happy to report back to you after i've had a chance to review that. >> when we look at another really important set of provisions in the affordable care act, it's something i called patient protections where everybody has insurance, no matter who it is have more ability right now to get the care they are paying for for their insurance, it's notjust the decision of the insurance company . and so there are a number of different things that folks can now count on and one is having an essential set of basic healthcare services that are defined. so insurance companies are getting this, everybody knows the basic services that the woman will get miniature maternity care, mental health will be covered the same as sickle help or substance abuse services and so on so there's a basicset of services . you support having that as a basic set of essential services in our healthcare system? >> i support americans staying in charge of their healthcare. i support americans being able to decide what benefit package works best for them. i think it's hard to know what works for one person might not work for another person. and i think it's important that people be able to make the decisions that work best for them and their families. as a mother of two children, in a family i know what we are looking for but what i'm looking for might not work better for another family so i support americans being in control of their healthcare and making the decisions that work best for them and their family. >> you believe women should have to pay more to get prenatal care and basic maternity care? in coverage as a provider for coverage? >> i a woman so i certainly support womenhaving access to the care they need. i have two children of my own and i appreciate . >> should women be paying more for healthcare because we are women? >> i think women should be able to make the decisions that work best for them. >> but if the decision is made by the insurance company as to what to charge, how do we make decision. prior to the affordable care act, i said many times about 70 percent of the insurance companies in the private marketplace didn't cover basic maternity care and basically looked at women as being pre-existing conditions, being a woman, different kinds of healthcare services we need were provided, were essential services and that's changed now where women have what, basic services for us are scarred as basic services where we don't have to pay extra as wider in order to get basic care and so i'm asking do you think that makes sense? >> obviously i don't want to see women being discriminated against. i'm a woman and i appreciate that but i also think women have to make the decisions that work best for them and their families. women might want maternity coverage and some women might not want it, might not feel like they need that. >> i think it's up to women make the decision that works best for them and their families. >> thank you. thanks mister chairman. >> as you can imagine, you're not having to vote. so there's nobody here to the question so i think what i'll do is reset here in 15 minutes , sorry to interrupt like this but that's the life of a us senator. >> i sure appreciate you and appreciate your patience and appreciate, i appreciate the way you are answering these questions straight up. and your expertise really comes through. so with that, i'll recess for about 15 minutes and hopefully i can get a second vote right there. >>. >>. [laughter] [inaudible conversation] let's return to senator laufer. >>. >> thank you mister chairman. congratulations on your nomination. thank you for paying a courtesy call to my office. we have a great discussion, you have an impressive record with regards to medicaid. basically pushing for later innovation and flexibility in the program. >> i must say your opening statement was not only relevant, on point, but it inspiring as well. thank you. >> i think i can speak for all members of the committee. we need to make a popular statement availablemister chairman, to virtually every member . and take them on it. >> i agree with that. >> and bring things back together. >> as cochair of the senate, with healthcare costs causing concern about relations coming out of your agency will work or not work, with smaller growth providers. and i'm also interested in how we harness their innovations to develop delivery models that are better tailored to the communities. and their needs given their low volume for patients at high number of medicare and medicaid patients. we are working in indiana. how do we work to include our small and rural providers in programs without disadvantaging them due to the unique populations they serve, secondly, would rural route quality majors for different data thresholds be more appropriate to encouraging participation in certain value-based purchasing and or pay performance programs? >> thank you for your question senator. rural health providers are very unique and special challenges, often they are the only providers in their community that are providing services and so when people come to them, they're dealing with a variety of different health positions, not just primary care and preventative care. specialty care and they don't always have access to those services. even attracting a workforce and finding providers to come out to those regions is a challenge and it's difficult and because they have those multiple challenges, it's difficult for them when there are lots of rules and regulations and down from the federal government. as a small business owner, working with small physician offices, you sort of understand that it's difficult sometimes when they are on the frontlines and they're trying to manage such complex situations, to also deal with rules and regulations that are difficult. that being said, we want to ensure all americans have access to high-quality health care but we have to be very careful with our providers to make sure we are not putting additional burdens on them that could actually impact accessibility to care and quality care. i think when it comes to rural providers, we need to send them through the process. we need to make sure they have the appropriate technical assistance to get where they need to be an understanding that the demands they have on their time can impact their ability to implement those regulations. >> i appreciate that. i think we have 83, probably more today. critical access and i know you have the same situation in indiana. thank you for your statement. as a member of both the health and finance committees and as many of my colleagues are, we often see adisconnect between new and exciting therapies approved by the fda and reimbursement policies from cns. take for example last year only one , one file similar was approved by the fda and guidance documents were still outstanding. cms proposed and finalized the containment policy that could stifle innovation in this area. how do you anticipate working with the fda to ensure cms is developing the policies for providers and taxpayers? >> i think collaboration and coordination is critical within hhs. i can appreciate secretary price and his leadership there. careful coordination and collaboration between similar agencies or sister agencies is important area and i think on the front end and discussing with them, understanding what their intentions are, what's coming down the pipeline and making sure cms is prepared to coordinate it with any efforts that the fda has. >> i must tell you that the healthcare delivery system, i'm talking to many of my hospital administrators and the rural providers in charge of cms. the term we use a lot in the past has been symmetric, i know you're going to fix that. but there is a cms center for consumer information and insurance oversight. that's the new acronym. i was not aware of that, but i knew most of them. it has responsibility for developing and is molesting policies and rules governing administrative healthcare ax marketplace, what role do you see playing under your leadership? >> is unconfirmed as administrator, my job is to implement law. besides playing a role with the current law, i worked to congress and efforts around addressing the affordable care. in my assessment of the role will depend on how congress decides what to do with the affordable care. so i make that decision based on the ultimate outcome of congress decisions around the affordable care act. >> i must say mister chairman that i'm impressed with your statement and i know that we have several years to talk about the unraveling of obamacare. and the entire insurance company leading the market, we have another one describing it as a death . i think we need to the rescue team to make sure that is still there but build new bridges. and i think that would be my take on that. thank you so much for your testimony and thank you for the leadership and i know you're going to bring to cms. >> thank you center. well, we're waiting for other questioners, let me ask a question, one of the issues this committee has focused on over the past three years is a large backlog of medicare appeals resulting the cms contractors. at the same time, in proper containment is the real threat to the financial well-being of the medicare program. >> what are your views on how to balance a robust program and also claims accuracy with the need to ensure timely payment to providers without causing too much undue burden? >> i think that's a very important question. proper fraud and abuse, if unconfirmed will be a top priority. that's what i call, should be low hanging fruit, if you look at the medicare program and ensuring its sustainability over the long term and given the medicare trustees report, about the future of medicare and running out of money at some point, we can't afford to waste a single taxpayer dollars. so if i think about fraud and abuse, and especially with fraud prevention and looking tohave efforts really be on the front end , not waiting to do pay and then chase but really on the front end, addressing fraud so as we are developing programs to make sure that we are putting those procedures and policies in place, that we can identify fraud and abuse on the front end. i think the issue that you raise in terms of backlog and the burden that what's on providers is something that concerns me. we want to make sure with cms for policy that we are preventing providers from participating in the program and being active in it. and that the backlog and things like that have really made it difficult for providers where they're having to, they're not getting paid issues so i think it's a balance that we have to strike with being aggressive on fraud and abuse but not penalizing and focusing our penalty efforts on the bad players without penalizing providers that are trying to do the right thing. >> the stakes are increasingly moving their medicaid programs into a managed care delivery system. with managed care on our representing, almost 40 percent federal medicaid spending. now, in the last year the cms released an updated regulatory framework in this case of managed care. what if any changes do you believe are important for federal state oversight of medicaid. and it's managed care. >> i think managed-care has been an important opportunity for states, it gives them the opportunity to set a capitation rate with providers and hold the managed-care company accountable for meeting the financial demand and it's also an opportunity to set i'd identify goals and outcomes and hold these companies accountable for the care and the outcomes that they serve.and that they provide. in terms of the regulatory framework and the managed-care role, i think that we probably need to move to an era where we are holding states accountable for outcomes. having states having to go through pages and pages of regulations, my question would be for that regulation is what does it do to improving health outcomes for the individual? i'm all about wanting to make sure that we are being appropriate with our health care dollars and managing resources effectively , but when we look at regulation, is that regulation hoping states improve health outcomes? states will spend millions of dollars implementing that particular regulation and i think we have to ask ourselves, what will we achieve? there are important developments within the managed-care regulation but if i'm confirmed i want to take a look at that to make sure we are not burdening the states with additional regulations. >> okay, let me ask you this. your written statement was providers struggling to deal with participative burdens. while we need providers to be accountable, for the care they provide and the associated government spending, it is crucial to minimize the regulatory requirements and take time away from treating patients. we've heard concerns regarding the very specific requirements that are a part of medicare and medicaid electronic health records, the medicare and medicaid electronic health records incentive programs. we also hear that many other requirements are needed or outdated. how do you think about the important test of reducing unnecessary regulations? >> i think one of the places to start is by talking to doctors and having open medication in collaboration with physicians. if i'm confirmed that would be a priority for me, to touch base with our providers and understand the issues that are getting in the way of them being able to provide high quality care for the patients they serve. i would want to identify speculations and provisions that are asking providers perhaps to consider maybe not participating in the program so i think starting with that open communication and dialogue and working with them to understand what their concerns are. >> thank you, i think i'll turn to senator wyden for a question. >> thank you very much. and again, miss for her i'm trying to get a sense of how you would approach some of these things. that's why i asked apropos of what cms did. just one example, specific example about putting patients responsible with respect to medicare part d, this committee as the chairman touched on, the collie touched on, members feel very strongly about rural practices and rural patients and we feel very strongly about making sure that we get the macro right. and what i'm home and work on, i get asked about two key parts of the new payment system a lot. i get asked about virtual groups and the definition of more than nominal risk. people say hey, what's this going to be for the small and rural practice. now, obviously this is not dinnertable conversation. but for the doctors in rural oregon, small practices. they say this is really going to tell us whether we are going to get to succeed in this brave new world of payment system. >> so tell me a little bit about how you as administrator would look at something like this and it senator for example has also been concerned about the virtues. >> how would you go about structuring and implementing virtual groups? >> i think that small providers, rural providers in terms of background i think it's going to be a challenge for them. i think it's a worthy goal but were going to have to be supportive of them to the process of implementing it. in terms of providers taking risks and especially smaller providers, that's a larger mountain to climb. they're going to be reluctant to take risks. when they are starting out, many small providers or rural providers now have large financial reserves that health insurance is half and in terms of putting them on the hook, a lot of them when we think about outcomes and health outcomes and holding providers accountable for outcomes, a lot of that also depends on patients and i think thinking about strategies about how we can engage patients to be a part of that equation , so that they have the same investment, they have some investment to work with providers towards achieving outcomes. but in terms of smaller providers, rural providers taking on risk, that's going to be a medical challenge. let's on virtual groups, what is your take on, let's say the most important work. >> i think we have to continue to work with them to understand what their specific concerns are and try to address it but i think at the end of the day, those are going to be challenges we are going to have to work with. what i found is listening to, understanding what their concerns are and trying to say to the best of our ability if we can address those concerns. >> and what about the question of nominal risk and again, i want to keep this open ended enough so that this is not, i want to hear about paragraph three, line 2. i want to get a general sense of how you'd approach it because this is what rural positions and patients are going to be about. i'm going to be a town hall meeting in a couple days. i'm talking about nominal risk. >> i think this is the challenge. i don't know that rural providers are small providers want to take risk at all. and i think that when we are designing these programs, we have to keep in mind that their specific needs. taking on risk is something that insurance companies have done, some of the larger healthcare systems have done. if we look at some of the acl models that providers, even large healthcare systems are uncomfortable taking on risk so this is going to be a considerable challenge for smaller providers and some of them may not want to do that. >> so does that mean, when i listen to that, it sounds to me a little bit like mister verma wants to keep key fee for service. >> i think c4 service, there are definitely concerned with fee for service that are rewarding volume over quality. >> and so i'm not suggesting that that works better. i think there is something to be said and i support efforts to increase ordination of care and to hold providers accountable for outcomes. i think that in terms of, there's also holding providers accountable for outcomes and it's another thing altogether to have them take risk. >> so let's do this like we did the other two questions. i would like in writing because this is so important. for rural practices and rural providers. i would like just in one specific that you would pursue to try to address these issues. the reason i'm asking is because it is a big link. >> there's nothing about that, there is no question that trying to keep rural practice open is a big risk. >> but these are the questions that providers are going to ask when they see me and say ron, you are on this committee, do with these issues, how is the government going to go about doing it? i'll have one additional question. >> mister chairman, let us add that to the matter of the specific, both with respect to putting patients first, to putting insurance companies first, yesterday and the pharmaceutical, the question where i would like a written answer and i think given the fact that these matters are moving on a fast track, we are going to need to have your answers presently. in the next three days or so. >> okay. i will have one additional question. >> i think we only have a couple more minutes. >>. >> we both have to go don't we. >> if you are willing, we could do the vote, i have one additional question, and i assume you will want to make a closing statement at the end and i would like to have the senators coming back, i think. >> okay. >> we will come back. >> let me use a little bit of this 10 minutes for another question. >> there's great provider interest in participating in various medicare products and changing the way payments are made to incentivize riders. to change the way that they deliver care. many of these alternative payment arrangements are being run through the center provider care and medicaid innovation center. but others are being conducted in the tentative, this is a good portion of the accountable care organization program. >> all these programs involve some type of student, formal evaluation, there is understandably great interest in knowing what works and what does not. so i'm assuming it's possible, but what is your view to testing different medicare payment approaches , and try to assess the results. >> i think a couple things, one first of all i would say that i support efforts around innovation, it's important that we are always trying to climb the highest mountain and that we are never satisfied with where we are, we're trying to figure out how to do better, how to get better quality care, or health outcomes and improve the delivery of services so innovation is important. but as we are looking at testing new ideas i think process have to make sure a couple things, we need to make sure we are not forcing, not mandating individuals to participate in an experiment or some type of a trial that there's not consistency around. that's important. i would say first off, in terms of evaluation, evaluation have to be as important component, that's why we're doing it, to understand whether that can be transferred or used for a larger population worker policy of a program. so valuation is a critical component of that. that needs to be set up on the front-end. it needs to be before the evaluation goes full-scale, it should be done on a population a small frame first before us expanded. evaluation needs to be done on the front-end through the process and i think as is expanded or before us expanded, those results should be shared with stakeholders and i hope as members of congress there should be discussion about that before that becomes formal policy. >> thank you, let me ask one more question.and we're waiting for some of the things to come back on going to have to vote again. seniors have a choice whether to enroll in the traditional government run medicare service program and that's not quite alternative, private production called medicare advantage. >> according to cms, approximately 18.5 billion people, roughly 30 percent of all medicare beneficiaries are estimated to have signed up for medicare advantage plans this year. generally, medicare advantage plans offer extra benefits such as dental, vision, hearing and wellness or required smaller copayments or deductibles in addition to medicare. sometimes seniors pay a higher monthly premium to get these extra benefits. but also, their financial plan savings. additional medicare does not limit asian studies were part a and part b services. i think some seniors can buy supplemental medicare coverage called medigap. >> people who do not have retiree coverage or who cannot afford medigap find medicare advantage plans, offer the benefits of traditional medicare does not cover and protect them from higher-than-expected outcomes. i had a lot to do with medicare advantage, i'll say that in advance. mister, can you commit to working with this committee to preserve and strengthen the successful medicare advantage program? >> i can and it would be my pleasure to work with you on that. i think medicare part two or medicare advantage has been a great program for seniors and what i like about it is it's offering choice for seniors. they have the ability to figure out again, just like in part d, what plan works best for them and the fact that it provides them the opportunity to have additional benefits, vision and dental services i think is very important and the fact that it provides more choices for seniors is an important component of the program so i'd be happy to work with you on that. >> thank you and i notice thatsenator drago is going to pass and doctor cassidy is here so i'm going to call on him . next and then, i'll have to have staff, staff work on this. thank you for being here. i don't think i'm going to be back but we will just continue on. >> senator? [inaudible] >> we are both familiar with the data from national security research that showed the expansion in some states of medicaid expansion, not necessarily the expansion but medicaid expansion didn't do much for outcomes. the healthy indiana plan seems to have had an effect on outcomes. and can you just comment, the nature of the structure of getting folks help payment and requiring on their part, what that did for expense as well as for outcomes? >> thank you for your question, it's always a pleasure to talk about the healthy indiana plan. the healthy indiana plan is about empowering individuals to take ownership for their health. we believe in the potential of every individual to make decisions about their health care. >> i might interrupt you occasionally. there's some that say that health savings accounts even defunded are not appropriate to those who are lower income and adjust the sophistication with which they handle that. but you're suggesting that that was what, 100, 138 percent. >> the healthy indiana plan or to the very lowest level, at the poverty level that people don't have income. >> they were enrolled in your plan as well. >> they were enrolled in our plan. what we find is just as individuals are poor doesn't mean they are not capable of making decisions. it doesn't mean they don't want to be able to have choices and that they shouldn't have those choices. they're very capable of making decisions about their health care and just because somebody is poor doesn't mean they shouldn't have choices and they are not capable of making decisions that work best for them and their family. >>. >> in other states where there was an expansion that popped up here, class that section went down but i think you have data outcomes improved? unlike the national bureau of economic results that shows outcomes did not improve. >> the healthy indiana plan, what we seem is that the individuals that were actively engaged, making contributions to their health savings accounts had better outcomes. and more primary care, more preventative care.lower er use, they were more satisfied with their care and we also show they had better adherence to the drugs that their doctors prescribed so across-the-board, >> my putting us between those who make contributions of bills and those that did not you ended up with two different populations , that the bill contributed with respect to number one. similar to the regression analysis, you find that to be the case? >> what we found is the individuals that were making contributions toward their care works for individual so they had more complex illnesses. and yet when they were making contributions toward their care, they had better health outcomes than individuals that were healthier to start with. >> so the full were sicker,. we less disposable income, became sick as much nonetheless valued healthcare more. >> will to take ownership for their health. just because they don't have income doesn't mean they don't want to have choices. we believe in the dignity for people to make choices. >> i think the key factor, they talk about the activated patient and you're using the term in powered. that is in the critical factor. to what degree is the patient engaged as a partner in their health. to what degree does she participate, they're both related to each other, but that ends up as a positive outcome, lowered cost. >> that's exactly what we've seen. even with the healthy indiana plan compared to other plans, we've actually been able to do it to cost less and reduce the number of uninsured at our state at higher levels than other states that have run more traditional programs. we've done it at a lower cost with better outcomes and reduce the number of uninsured. >> inevitably, there is a federal role in this. so, is it possible you could reduce the federal role 20 in a plant such as your still be viable with high poverty rate. >> in indiana, negotiating the healthy indiana plan and the waivers, this was something that governor daniels actually asked the federal government, can we use the healthy indiana plan for the medicaid expansion, and he asked this before the supreme court decision which made it optional, and it took us, he wrote that first letter in 2010 and it took the federal government almost five years to make a decision about whether this program could work. i think that is something we need to look at where i would hope congress would want to work on because that type of back-and-forth. >> could the process be made more efficient but there's federal dollars we've seen as well. >> thank you, i yield back. >> thank you. senator nelson. >> the morning. i enjoyed talking to you on the telephone. do you support turning the medicare program into a voucher system? >> i support the medicaid, the medicare program being there for seniors. people are making talk contributions into that program. >> with that include the voucher system? >> i don't support that, i think what i do support is getting choices to seniors and making sure that that program is in place. what we have seen his efforts, i think i think there's a lot of concern about the future. >> excuse me for interrupting. i didn't understand. the fella who is now the sec. of hhs had taken a position as congressman supporting the voucher system. , turning medicare into a voucher system. do you support that? >> so, let me back up with my answer and try to explain this a little bit more. i think, what i've seen in terms of different types of options that are being discussed around medicare, those are borne out of individuals that want to make sure that program is around part i want to make sure the program is around for my kids and so, what we know from the reports. >> so to make sure it would be around you are saying you would consider alternatives? >> i think, i'm not supportive of that, i think we, i think it's important that we look for ways of making sure that the program is sustainable for the future. >> let me give you one of the alternatives. one of the alternatives is to increase the age from 65 - 67. do support that? >> i think ultimately, which direction we go into is up to congress. as the administrator, my job would be to carry out whatever congress decides is the best course of action for the medicare program, and i would hope we would work toward making the program more sustainable so that it does exist for future generations and that it's a program that provides high-quality care, accessible care. >> so you don't think it. >> you don't think you should be involved in policy and you said leave it up to congress. >> i think it's the role of the administrator to carry out the laws that are created by congress. >> all right, let me ask you, there's another availability that seniors enjoy which is the doughnut hole was closed which means that seniors in florida spend about a thousand dollars less out of their pockets by drugs being reimbursed through medicare so, in the medicare prescription drug program, now i know you just had a question close to this, but what i need to know is, do you support the provisions in the aca that close the coverage to make prescription drugs more affordable, or closing the doughnut hole, yes or no. >> i support efforts to make the availability of medications affordable and accessible for seniors. i want to make sure they have choices about the medications they need and that coverage is affordable to them. i support efforts. in terms. >> i'm running out of time. i'm just trying to get clear your thinking on this. so, if the senior, since you support making drugs affordable to seniors, but if the senior had to pay a thousand more dollars out of their pocket. year for their drugs, is is that something you would support. >> ultimately, what happens with the doughnut hole is really up to congress and how we move forward on this. as the role of the administrator, my job would be to implement the policy or the legislation that is developed by congress. >> so back to the policy by congress. >> here's one you may be able to answer. how about, as you know on dual eligible, the federal government gets a discount from the drug companies for the dual eligible that are eligible as medicaid until they get to 65. then they get their drugs from medicare, but then there is no discount. would you support requiring drug manufacturers to play drug rebates to medicare for the dual eligibility. >> as i said before, i support efforts to make drugs more affordable to seniors, and i think this is an issue that we are all concerned about. the president is concerned as well that we need to make it more affordable. i would look forward to working with congress on strategies that can help you be more affordable while maintaining a sensibility and ensuring that our seniors have access to the drugs that they need. >> i am sorry that you have the constraints put on you so that you can't answer these questions forthrightly. those are the questions that i can tell you senior citizens are begging to hear the answers because, if you had approached this as candidate trump had, saying he was going to protect medicare and social security and not have any cuts, your answers would be different and they would be clear, but, you have chosen to go the route that you have and i'm sorry that you have those kind of constraints. thank you mr. chairman. >> thank you senator nelson. for the benefit of the members of the committee, the order order remaining of those who have and asked questions is isakson, brown, eller and scott and that's the order we will go in and let someone chimes in that wasn't on the list. >> first of all, i will just make a statement, you don't have to really, unless you want too. words are strange things sometime. they can be used depending on what you want the ultimate goal to be. in the veterans administration and i'm chairman of the veteran affairs committee, three years ago republicans in democrats came together to develop the choice program to expedite veterans getting services and to maximize the use of the va and the private sector. there were 2 million more appointments filled to va than had been in the previous year and all those gave access to the private sector gave veterans better access. the veterans have the choice to use the private sector. i think that's a good example of where choice made a difference. it made a sensibility and made the program work better. choice is not a bad word. choice can be a very good word in the congress did that three years ago in august and it's been a good program that has worked ever since. are you familiar with that program? >> i am not familiar with that program. i agree with you choice is critical went. when there's choices and competition and we've got folks that are trying to attract our beneficiaries to the system, choice and competition are very important to driving better quality and outcomes and lower cost. >> in georgia we have 1.9 million georgians on medicaid. 1.3 million of those are children. half of the children born in my state are born with medicaid benefits. are you committed as we go through the reforms and enhancements to make sure we keep children foremost in this for. [inaudible] >> i certainly understand the importance of health care for children. one of the things i'm reminded of in my work with medicaid program, i remember hearing a story about a woman, and it was after the program had been passed that she talked about how she had a child, and infant one or two years old and she had gone to the doctor and her child had an ear infection and the doctor gave her a prescription a simple antibiotic to treat the infection and she went home that night and she had a choice to make as she filled a prescription. she wouldn't have enough money to pay for meals for the whole family so she made the painful decision of not filling the prescription and feeding her family for the whole week. what happened to that child is that because of this untreated ear infection, he ended ended up losing his hearing and going deaf. i'm always reminded of that story and that child now needs lots of different services to help him through and that is something that could've been prevented. it's very important that children have access to high-quality services. that is really important so we don't have situations like that. >> thank you with your answer. are you familiar with the bill that was passed. >> senator warren and i had a provision in that bill that's very important to us on home healthcare. it provided for reimbursement under part b on home healthcare and home infusion through medicare. it's something we want to make sure, under the aca home healthcare was in was totally removed. i know home healthcare is the best environment and the least cost to the government. i hope you will look closely at the provisions we put into it to make sure they get implemented. >> i will be happy to work with you on that. i agree, i applaud congress for coming together on a bipartisan basis to pass that law and i think it will have a tremendous impact on the health care of americans, and i appreciate your efforts on that. we'll be happy to work with you. >> lastly, when i was in the state legislature years ago, the biggest thing we fought was fraud in medicare and that still is a problem today. i am very familiar with the business that i was in, eligibility is important to make sure you have minimal fraud and minimal ways. are you committed to using the commercial resources available in the private sector to verify eligibility where that important? >> i am absolutely committed to that. >> thank you very much. >> senator brown, i'm sorry senator mendez slipped in. >> thank you, mr. chairman. congratulations on your nominations. one of the successes of the affordable care act was the establishment of the nationwide benefit standard called the benefits package. one of my amendments to the law which was adopted was to ensure coverage for behavioral health services like therapies for children with autism are available in every plan purchased through the marketplace. that's to ensure that a child in georgia or indiana or new jersey has equal coverage and equal access to the care they need. i have heard from countless families about the anxiety they have over losing access to critical autism services through a change in the essential health benefits that allows insurance companies to deny coverage which is especially acute in states that lack a state base requirement. do you agree that a child access that covers a condition like autism should not be based on what state they live in? >> i appreciate your question. my husband is a child psychiatrist so he deals with those issues on a day and day out basis so i certainly understand the concern. i have been advised by the office of government ethics not to participate on issues regarding mental health services because my husband is a psychiatrist and it could impact his practice. >> with all due respect, autism autism is not a mental health issue. autism is an illness that we are still trying to develop the essence of its cause, but at the end of the day, i use it by way of example. are you suggesting that you cannot tell the committee a simple answer to the question that it shouldn't matter where you live in the nation that in fact you should have access to the same coverage as any other child. >> i think all americans should have access to the healthcare services they need. however, the issue that you are asking me to comment, i have been advised by the office of government affect not to participate on matters that because of my relationship, my husband's practice,. >> did they define to you the list of things that fall under this category. >> he does treat children with autism so they have asked me not to engage on matters that involve his practice. >> pretty amazing to me. let me ask you this. as you know, congress had to act with a package of medicare extenders. which of those policies do you consider to be your top priority? >> i have not reviewed that particular regulation, but i would be happy to review that. if i am confirmed i will work with you on that. >> let me just say, medicare is a big part of what cms deals with. i would have thought that in preparation for this hearing you would have a sense of these are extenders that are almost, on on an annual basis or by annual basis, but it is the heart of giving us a sense of what you as the potential administrator would be advocating as it relates to medicare. your role as a cms administrator is more than just executing simply the laws of the country which, certainly you word, would, but it is also a policy development heavy position that the president and the sec. of health and human services and the congress relies on when drafting laws that ultimately would have impact in your parameter. you have no idea as to which when you consider the most significant. >> at this point, i would want to review that before i gave you my opinion on that particular area. >> let me ask you this. during your meeting in my office you referred to so-called able-bodied beneficiaries as we were thinking about medicaid. do you believe low income and working-class individuals, who gained access to medicaid, thanks to thanks to the affordable care act expansion should be eligible for medicaid? >> i think that is a simple yes or no. my time is limited. you believe they should have access to medicaid eligibility? >> i think all americans should have access to high-quality health care services. >> that's not an answer. >> i'm asking about medicaid specific. >> when i think about the medicaid program, i think of it almost in two parts. there's the part of the medicaid program that serves the the aged and the blind and the disabled. that is a different population than some of the able-bodied individuals. at the end of the day, all americans should have access to high-quality affordable healthcare coverage. >> well, i will just simply say, unresponsive to my question, i can't vote for someone to be the administrator of one of the most significant agencies that affect the healthcare of people in the country if i cannot gleam from you, in an open hearing under oath what your answers are to these questions but i have no answers. so, it's very difficult. i have not been against the president's nominee. i voted for several of them but you have to give me more than not. i hope your responses to written questions will be more enlightening. >> thank you. congratulations on your nomination. we had a great discussion about innovation and the pacific northwest but i wanted to follow up on that. to my colleagues point, there has been a lot of discussion about medicaid. are you in favor of that? >> i think the medicaid program as a status quo, is not acceptable. i think we can do better for many people who depend on this program. we're talking about quadriplegics, people who are developmentally disabled. we can do a better job than what we have today. we know we are not delivering great outcomes. even people who don't have medicaid have better outcomes. >> you think there is a problem with block granting. >> i think we need a look at how we can make this problem program work better. the status quo is not acceptable. this is the united states of america. we can do better for vulnerable populations. we can hold state accountable for producing better outcomes. >> are you endorsing that. >> i am endorsing the program being changed to make it work better for the citizens that rely on it. >> so you are not endorsing it. >> i'm just trying to understand because this is the debate as far as i'm concerned, and i know several of our colleagues, probably those in the house are very adamant about this. i'm just trying to understand where you are on that question, whether you are either for it or against it or have concerns about it or endorse it. >> i'm giving you a little more room than my collie gave you. >> i appreciate that. thank you. what i support is the program working better and whether that's a block grant or something else, there are many ways we can get there. at the end of the day, the program isn't program is working as it should. when you have one state spending $4000, you're another state spending $15,000 for the same population, can we show the outcomes are better? can we show that individual had access to high-quality care? what we know is going on on the state level is that in terms of assess ability, one third aren't taking medicaid patients and that means for disabled person, when they are sick and some of the doctors won't take them and some the doctors that are taking them, they have to wait for a long. of time to get care, i think we can do better for these people and i support efforts to get us there. >> i would say this. this whole notion of block granting, we know what the results of those have been. we have numbers that have resulted in a 37% cut. if you just extrapolated that out, unless you assume you have the states that would step up, my colleague was talking earlier about the increase in population the increase in population is what is driving the costs. coming up with a better strategy for that, like rebalancing like i had a chance to talk too about is way more cost-effective. we save $2.5 billion by taking dollars by taking people out of nursing home care and putting them in community-based care. trying to say we are going to block it ends up, if you just said, and the state and come up with any more funds, if if you apply that same 37%, you would be cutting 43000 people off or 10000 people in this area. that other block granting program have received over the past 15 years, it would be like cutting a million people in ohio off to medicaid unless the state come up with more money. my point about this is, i hope you will be much more of an advocate for the innovation so instead of trying to nickel and dime for people on a copayment, come up with a strategy like rebalancing that gives people real opportunities to deal with the population, save cost and key people in a better situation. that is why i have grave concerns about this notion of block granting medicaid or decapitation, as you mentioned. >> this is what it should previously be about. what's going on as we have a very inflexible system. states are trying to do creative things and rebalance incentives and giving medicaid beneficiaries the option of being served in the community. that is something we should do. the way the system is set up, states have to go to the federal government for any routine changes anytime they want to do something innovative and creative, it can take years to get a waiver done. we need to create medicaid program that allows them to be innovative so that they can focus on producing better outcomes. i do not want to see anyone not get health services. we are talking about the most disabled and vulnerable people in our population. we can do better. we can deliver better outcomes for these individuals. we need to hold them accountable this isn't about kicking people off the program, it should be about improving outcomes. >> my time has expired but i want you to remember innovate, don't cap take. >> i will follow up on her points because i think the essence of her comments are absolutely accurate. first of all, welcome. you are a product of my state of maryland and we are very proud of your accomplishments. it's nice to have your family here. i want to talk about health disparities in this country. part of the affordable care act was to put a focus on that. there's good reason. historically they have been discriminated against in our healthcare system. we have been making progress on the problem. that's what i want to refer to senator campbell's point about resources. resources are important. i wish every policy decision we make in this decision and committee was driven by what is the right policy results. far too often it's driven. [inaudible] the point is, if you you move to a block grant medicaid program. who is vulnerable? the most vulnerable people in our society. in maryland, almost 70% of the medicaid population are from communities of color that's in my state of maryland. 70%. when we expanded the opportunity for medicaid under the affordable care act, it made a big difference. you may be familiar with the health center in prince george county. i've been visiting that center for many years. they are now able to provide mental health services and giving access to care because of the expansion of medicaid. if we were to go to a program that is innovated but doesn't have the resources to implement, vulnerable people people are going to get hurt. i just want to get your understanding as to the understanding of the importance of resources. we are not going to improve our health care system by telling people they can't spend money on healthcare. they can get the healthcare they need. it's the vulnerable population that will be challenged. as tough as budgets are here, budgets in kannapolis and other states around the nation are even tougher. medicaid is such a large part of the state budget that when you have to invest to innovate, they don't have the money to invest. tell me how you are going to advocate for the poor, how are you going to advocate those who are challenged in our system. i don't know all the answers but i applaud you for looking for innovation in your state, but i know some interpret it to mean that copayment for some have to pay, they don't have the resources and if they don't pay their put in a system where the denied certain benefits that they desperately need. i'm interested as to how you see this system being fair for those who are vulnerable. >> first of all, i would say, say, i have fought for coverage for better outcomes, for vulnerable populations my entire career starting with individuals with hiv and aids, working with low income mothers. the issues that you raised are near and dear to my house. i am a minority and i understand things are different. we have different cultural norms the impact how care is delivered and the type of advice that is given to minorities. i certainly understand that. you talk about the healthy indiana plan of making sure people have resources for their healthcare. we looked at the healthy indiana plan and it was all about choices. we believe in the individual dignity. what we have found is when we gay people those choices, they make make good choices and they had better health outcomes. we saw emergency usage go down. we saw individuals having more primary care. >> of course that is what we are seeing under the expansion of medicaid. many more people are insured. we are seeing much greater, much less use of emergency room care because we have more people in the medicaid system. the expansion of third-party coverage. if you don't have preventive care or pediatric dental, we know what happened. i appreciate that we are looking for innovation, but if we don't have the basic coverage, if you don't have the ability to provide the asic services, it's the people were going to suffer. >> i don't want to see the vulnerable sufferer. i've done this on the local level, i've done that on the state level and if confirmed i will continue that. >> is nice to see you again. thanks for coming to my office. i was a little disturbed with the medicare age. they were not willing to tell the committee had changed his mind or was opposed to it and privatizing medicare. i would hope you would look at the platform to tell your boss, but i would hope you would use that as a platform to stand up against those things because they are devastating to working-class americans. couple questions. first question is simple, they recently named a new director for the department of medicaid. governor kasich extended medicaid in ohio. 700,000 plus people now have medicaid coverage. my question is, this is easy, i would like to ensure there's a positive working relationship and i would like you to commit to sitting down with the director and perhaps a group of medicaid administrators can discuss my state and their state priorities and concerns when it comes to the medicaid program. i would like to ask you to do that on the first few months of the job. >> i would be my pleasure to do that. i feel strongly with working with states in an open relationship and partnership. >> during our meeting you spoke about chip and what it's done. in 2010 they streamlined enrollment processes and we now have 95% of children, what's not to love about that. secretary price mentioned in this hearing that he would support an eight year extension of the current ship program. it is important that when we upgraded chip in 2010 and streamlined it so it is a clean law and easily understood. do you agree with secretary price that congress should act quickly to pass an eight year extension, and you agree that should be an eight year extension of the current? please give me a yes or no. >> i support the reauthorization of the chip program and agree with congressman that we need to do this to the fullest extent possible. >> to agree to eight years that he suggested? >> i support the reauthorization as long as possible. >> eight years or more. >> what you don't acknowledge or don't understand is your recommendation, you keep saying it's up to congress, but your recommendation, if you and sec. price would say we want eight years extension and you would say one a kleenex extension, not a a rollback of what we had in 2010, it would really, really matter. i think you get every democrat and most republicans and that would take that off the table, take that uncertainty out of all these programs that we just limp along, extending it a year year or two or three or five at a time. i ask you again, we you recommend eight years and will you recommend a clean chip extension. >> i will recommend and support the reauthorization of the children's health insurance program as long as possible. i think children need to have access to high-quality services. you and i talked about this. i support children having access >> i appreciate the answer. beginning march 8, let me ask you about another issue. hospitals hospitals will be required to give notice is to applicable beneficiaries under the act which i'm sure congress, as you are aware passed last year. we you commit to aggressively enforcing the notice requirement for hospitals? yes or no. >> if i'm confirmed as a cms administrator, it is my job to follow the law and to implement it as designed by congress. >> the moon notice is an important first step toward giving beneficiaries additional information, but it doesn't fix the issue of the underlying three day stay requirement. hospitals are increasingly caring for medical beneficiaries as outpatients under observation status as opposed to admitting them as inpatient. inpatient patients, while the classification of hospital stay doesn't affect the level of care that a beneficiary receives, it has significant repercussions for the three-day requirement and for medicare coverage. do you support the changes to the three-day stay requirement? >> that is something i would want to review and will look forward to working with you on that. >> to have opinions of the three-day stay requirement. >> i would want to review that in more detail and. >> you know what it is? >> i do know what it is, but i would like to review that and at this point, i would be happy to work with you on that. >> ticket price who apparently knows more about the issue raised during the confirmation hearing, he specifically mentioned he would like to work on improving this role. i assume you would work with him on that. can you give me any thoughts on what you would do to improve the three-day requirement? >> i think we need to work with providers on this. there has been some issues in terms of skilled nursing facility and the impact of the rule on the patient's ability to get in with that so i would want to review that more carefully and be happy to give you my comment. >> that is less than satisfactory but i appreciate the effort. it is a huge, it's a huge concern for beneficiaries across the state. we get calls, as i'm sure in indiana some of your counterparts doing medicare that calls, but i know senator cardin and others have been working on this issue for years and i hope we can work on it. thank you. thank you, mr. chairman. >> i apologize that he slipped under the transit. i have to go to him next. >> thank you, mr. chairman. i hate it when that happens. my apologies. thank you for being here and thank you for your willingness to serve. i know this has been touched on already, but i wanted to follow up because when the macro final rule was released last november, i was concerned about the decision to delay implication for virtual groups. cms was soliciting feedback and said it would not come until 2018i am continually concerned with how we roll this out. we make it a priority of yours to ensure that virtual groups are timely and effectively in implement it? >> i would be to work with you on this issue. >> how do you plan on engaging for the rule. >> i think the frontier providers are in a difficult situation paid we need to engage with them on the front-end. we need to make sure we understand the impact on them i think living in d.c. we don't always have the understanding. anytime we have a policy, we need to work with providers on the front-end to make sure we know what their concerns are and what the potential impact could be. once something is out there, we need to make sure we have that continued collaboration and medication so there are problems and issues that we can address in a timely way so we are not impacting patient care and we have a commitment to providing high quality care and access. >> i'm glad you say that. additionally the gao had recently released a report that lists the hurdles of small and rural practices in participating in the new payment models. as cms moves away from fee-for-service and toward quality, i would like to ensure that they can participate. aside from the previously mentioned virtual groups, how do you go about ensuring that they have access to the program. >> i think it's critical to make sure in rule areas and frontier communities that we have the high-quality healthcare. again it goes back to collaboratively collaborating with them. these programs, they have enormous promise to move us in the right direction. we need to work with them on the front-end to make sure they can handle the new regulations and rules. i find in the rule communities, they are stressed in providing care. they have a lot of enormous burdens. we need to be supporting them throughout the implementation. i think electronic health reference has enormous promise. i think it's helpful for physicians in terms of doing data, but it has been a rocky start. i've seen signs in the waiting room that say we are going to be delayed or it's going to take a while. we are still getting used to electronic health records. i've been in the room for my doctor where they're staying staring at the computer instead of looking at me. we need to make sure that it's working and working for providers and patients. if we are going to have electronic health records we should make sure that it fulfills its promise so if someone goes to the emergency room, even if they were in a different hospital or different provider system that the doctors can pull up the information and that they have that tools about how and what medications the person is on. we need to make sure it's fulfilling its promise and not becoming more burdensome. we need to make sure, i think there's a lot of potential there i know physicians like the ability to be able to say what form pharmacy would you like and immediately send that script. there's a lot of value there but we need to make sure it's also fulfilling its promise and giving us the things that supposed to do so when you show up you have all that information i know sometimes we've come short on some of those things. that's something i think we need continued efforts around that. >> my final point, i look forward to working with you. we need better coordination i hope we can make a lot of headway there. >> thank you. >> your time has arrived. >> terrific. >> congratulations to you and your whole family that is there behind you. your kids are very patient. i'm glad your and glad the families here also. 20% of the population in nevada is on medicaid. another 15% of the population is on medicare. we discussed in my office how important it was for you to strengthen and protect these programs and how quickly that was for the state of nevada. i just want you to know i appreciate the conversation that we had in my office. like everybody else i will not support legislation that weakens medicare. i would like to submit for the record a letter that i received from the speaker of the house and the majority leader. i asked sec. price -- >> without objection it will be made part of the record. >> thank you. let's go to a couple questions. i will maintain the conversation we been having on medicaid. nevada is one of 32 states that chose to expand eligibility for medicare program. numbers and see expansion the enrollment increased 350,000 to over 600,000 enrollment in nevada is over 200,000 than what was projected before the expansion. i've had numerous conversations with the governor. i've had conversations with state employees. our state legislature, our hospitals are all seriously concerned about moving this concern to a block grant. they are concerned that they will not have the appropriate funding to cover all 600,000. they are concerned they do not have the staff to implement such changes. they're also concerned with the part-time legislature, the state will not have time needed to establish medicaid problems. i guess my question is to you whether or not you are sympathetic, these expanded states like nevada and do you understand those concerns. >> i absolutely understand those concerns. i've worked with states. i understand the budgets and the states that have expanded. for me the opportunity is improving the health outcomes. we are talking about a vulnerable population. these are individuals where it's a safety net. studies have showed the outcomes aren't great. we know they're spending a lot of money. do we know we are getting better outcomes? the conversations that we are having should all be around improving health outcomes and doing a better job. i don't want to be about hurting states. that's where i come from and i understand, i worked with a lot of different governors and where they are in state budgets but i think this is about giving states and putting states in a leadership role. they have a better understanding of what can work in their state. we've heard about some rule areas. they have special challenges there. some of the things coming down from washington in terms of a one-size-fits-all approach doesn't always work. any state should have that flexibility to design a program that works better for the people that they are serving, and they are better positioned to make those decisions in d.c. i think this is an opportunity to create flexibility so they are not having to go to the federal government every time they want to make a simple and routine change. what we've seen in the medicaid program is because it's so inflexible, there's not a whole lot that you can do in designing your program, and so what states do often when times are tough is they cut provider rates. in 2012 we had over 44 states either freeze or cut provider rates and that has an impact on access to care. they are doing that, not because, not because they don't care about the people that they serve but because the program is so inflexible. i think an opportunity to give states more flexibly is an opportunity to improve outcomes for individuals. i don't think the status quo is acceptable. i think we can do better for disabled people and people who are vulnerable and dependent on this program. we can do better improving outcomes. >> my time is up. our block grants on the table or off the table. >> i think anything should be on the table that can improve health outcomes from this vulnerable population. >> it's my understanding that block grants are on the table. >> i think block grants. capita caps, anything we can do to improve outcomes and create a level of accountability for states, i think we should explore all of those options. >> every valentine's day i go the hospital and hang out with some of the kids who have been hospitalized several times a year for cancer or chronic condition that resurfaces. she has been in and out of the hospital as a youngster, 15 years old, and having an opportunity to see the challenges of so many families, and the necessity of their primary provider what were your thoughts about innovative things that can be done to reduce readmission and cost for providers and payer and improve care for those with sickle-cell and similar chronic conditions? >> i think one of the things we can do, anybody on the medical medicare program, there in a vulnerable situation. whether they have a disease specific condition, they are completely dependent on this program. as i said in my opening statement, sometimes this is a matter of life and death. they have they have no place to turn. we need to assure that we have the best possible program, better quality outcomes and i think those decisions and the ability to do that should come at the state level. the state has a better understanding of the delivery system and the citizens they serve. they are in a better position to make those decisions so in terms of readmission and really focusing on outcomes, i think on the federal level it's important to establish what are the expectations of the program and what are we going to hold states accountable for. it could should be quality and assess ability. >> have you found working with the state of indiana there were a couple of things you thought worked really well on the state level that you would like to see on the national level? >> first, i would say every state is different. >> i know. >> as i worked with states, i might be known for the healthy indiana plan and people say to that plan nationally. every state has a different opinion. i have never actually have a state that wanted the healthy indiana plan in its entirety. they looked at it and took think they liked about it and applied it in the designer programs. i think that's why we need to have a program that is flexible and allow states to do what works best for them. >> >> i think that's the concept surrounding that program is critical instead of micromanaging i think in we need to say definitively here are the outcomes we are driving toward back right now we hear doing is managing the process not holding states accountable. in terms of south carolina innovatively the application of the nurse family partnership for low income families or first-time mothers with that home visiting program is the eight excellent idea. but again with that program had a lot of thought into it many months to have been approved through cms how was state has an idea how it is proven in other communities and to do that on nub basis without combing through that process of approval is the importance to have state flexibility. >> mr. chairman first of all, with thank-you for the opportunity i had to meet with you i want to ask unanimous consent to be put in the record we have an outstanding nominee before us. she does not need to be subject to personal attacks and she is outside of washington. i get distressed the way these hearings go where we try to push for things in actual legislation that ought to be reviewed and reminding she gets to make good suggestions. we pass the final was. -- lots per you haven't just eddied medicare or medicaid or other situations, you have been hands-on and have done things. to make the process work better. you have a track record. it is very impressive. i think around here that make shoe over qualified unfortunately. [laughter] you have been cut people off of medicaid or medicare you have experienced working at the state level talking about frontier and whirl of the size to hear again as states are represented wilding has the lowest population in the nation also devastating economic hardship because the last administration did not like energy. so our state has to make tough decisions. one year-ago the legislature had to cut 8% because of the governor had to cut now they're into the second year where they came back the revenues are down they had to cut another 8% and that represents a lot of problems not just in the health care area but across the board and to be devastated by that. but they are working for that and will get that. we also talked about the competitive bidding program in this unique challenges would you be willing to have a dialogue of the bidding process that people get what they think they're getting and what we think we are buying. is that important for cms to put in place the one size fits all program quick. >> that is absolutely critical working for states when they see they're all different the delivery systems, at patient population, federal one-size-fits-all approach does not always work. what you bring up with competitive bidding is an excellent example where we have some providers paid at a rate that is more appropriate for the urban area understanding how that will impact that front provider so don't have those issues later down the line to be reached - - be sure we're not impacting beneficiary access to be sure they always have high-quality care. we don't want to see our policies and programs are preventing with providers. we very careful with policies sabir not pushing providers out of the system. when we attract providers we give medicaid beneficiaries more choices in and have choices that will drive quality and lower cost. >> but you demonstrate. not just something you wrote a paper on. you were working with individuals with an expiration -- expensive patient population a committed to working at the federal and state level to address those mounting financial concerns of tool eligible population? >> we must address that issue with the aging baby boomer population. we will have closer collaboration with the incentives in place to manage that program while to be insured we are providing comprehensive coordinated quality care. it is difficult and confusing we to make sure it works well for those beneficiaries. >> thank you for your outstanding presentation in your family has to be impressed as semi with capability to the answer and your vast knowledge. >> thank you senator. >> the ranking member would like to ask question then we will wrap it up. >> i will say i pretty much appreciate how this hearing has been handled by you prepare you made it clear that senators asked the question that is important. i have to questions for you. one stems from the horrible tragedy that you describe for the family was forced to choose between food or pay for prescription to treat the child infection. so they chose food and the child lost hearing permanently. what i have been told about the health the indiana plan that you designed, if you have an individual barely making $12,000 with the same kind of choice and chose not to pay their premium, they would be cut off with of coverage for six months so they would not get treatment for your infection or other conditions. is that correct? this is what i have been told of a book like you to tell me if that is correct. >> help the indiana plant is empowered individuals to take ownership. >> with all due respect is that correct? we looked at the figures with respect to poverty and the site understood it at $12,000 they would be cut off. >> the way it works if they are above 100 percent of the poverty level make contributions in to their health savings account with monthly statements to see how the money is being spent part of a complete their preventative health care services than they can roll over that amount to offset their contributions. if they did not complete preventive services they can still roll over because that contribution is there's and they owned that. what you indicated somebody does not make a contribution or chooses not to, just like with the affordable care act and in the exchange's, for the same population, they have 30 days if they don't they are terminated and cannot re-enter until the open enrollment period so that is the exact same coverage and policy so we give them 60 days. >> there is a three month grace period with the hca. >> there is at 38 period would they continue health coverage but after that they suspend payment to the individual does not have payment for their health care services and they cannot re-enter the program until special enrollment. with help the indiana they have 60 degrees period before they are terminated. >> alaska this in writing that we reviewed this at $12,000 they are terminated. now to the ethics question that is reported in the paper in your state that said while you run the medicaid program you had a consulting firm paid millions of dollars that did business with the stay like to the packard and health management associates that provided management services . let question became with the indiana athletics' regulation conflict of interest does not apply because you are a contractor and not a state employee. but basic ethics principles because it is hard to see how basically orchestrate the health programs then get paid by the contractors the state pays to eukaryote those programs process side of the lot and i understand those rules to not technically apply to you because you are a contractor. but how is this not a conflict because you set rumbles sides of the negotiating table? >> i hold honesty and integrity and adherence to a high ethical standard with my personal philosophy. of me and my amply and by on children and. in terms of the issues that you raise, we sought the ethics opinion and sought counsel to make sure there are no issues. practically day to day we were not negotiating for h-p but help them develop communication materials when they put out system changes so people lenders stood what they were through communication. it was around policy to develop programs. there was not overlap. was there was potential of programs we would recuse ourselves. we were never in a position to negotiate on behalf of h. puerto rico any of the contractor for the state we had a relationship with. and the state knew about our relationship they issued a statement indicating a response to the indianapolis star article they were aware of the relationship we disclose that and done a practical day to day level we did not engage in anything to put this in a situation bieber supervising their work or negotiate a contract and made that very transparent on the front end of paris ever in issue talking about contractors are implementing a program and it came to a vendor with a relationship by would recuse myself and get up and leave the meeting said there was never an issue. the state has spoken on this in the work we have done but vendors has extended over three separate governors and six secretaries of health. >> recently head of the state agency administering the contract told the paper you want to attempted to negotiate with state officials on behalf of hewlett-packard while paid by the state. let's do this because there are differences of opinion. it wasn't just hewlett-packard but a wide array of companies and a wide righty and services. that indiana ethics rules to not apply to you as you were a contractor. no dispute. but it looks like you were on both sides of the table as a lot of money was being decided. that is my last point today, ms. verma berger you have been asked a lot of questions. i have listened carefully. they were not gotcha questions. they were appropriate given the fact you will head an agency that is involved with $1 trillion of spending and health care over 100 million people. these questions gave a sense of how you would approach them. i enjoyed our conversation. i decided i will give you as much real-estate as they could. that is why asked the question about pharmaceutical prices which is huge and so on portend. i will have her give me one example just one example of what she would do if confirmed in this position. and we did not get that so i will get that for the record but i would get those very carefully because when i am troubled for a the questions that are appropriate for a job like this and the public needs answers and i look for it to talking with you further. >> there is an important part of of process and not surprisingly you have handled yourself very well. bombs and did this expeditiously from the cms administrator. and that administrator that is not confirmed but has all kinds of conflicts. it to be a tremendous leader and the rest of the state. all i can say is you will be a strong and skilled leader as the cns administrator so to collect the challenges, a senator portman has questions? i did not know you came in. i was ready to wrap up. >> i have been here twice listening and i have separate hearings going on at the exact same time i would like to ask some questions. >> go-ahead. >> i apologize thanks for your patience and also to ms. verma who have been very patient provide have been watching them. my kids never could have done that. i heard the back-and-forth i like what you say of patients taking responsibility for their own health talk about innovation earlier that has to do with that and part of that it is leveraging technology and die like as many in the states doing things that our innovative the state of ohio had as innovative health care director you have worked with before and that is a great opportunity in need of more innovation. and also to all states accountable so so to look at the l. plate and the of quality you also made the comment that it could take years to get a waiver option sometimes you can't because we were unable to get one and a more holistic care but to have the better howell health outcome with a primary care but it takes 50 less time to go through the process for did to reject the ohio application you were involved to implement that so if you could talk briefly about what is the best part of the healthy indiana plan? then it went to talk about medicaid expansion specifically. >> it gives dignity to individuals and empowers them to recognize their potential. we don't assume they don't want choices and to we will create a situation and that leads to better outcomes more primary-care. higher satisfaction and better drugs inherent. >> that is what i want to hear because that is what we should all hope for because they take more responsibility for their own health. including access to primary care. we have to the did thousand people -- 200,000 people but over 700,000 in medicaid expansion. doc about the mandates of small businesses and the cost to provide health care 82% for small businesses but there is a lot of focus on the exchanges were frankly in ohio what is important for us as those 700,000 that is and medicaid expansion proposal that is my question for you i am concerned fredonia move forward to quickly to leave those people behind them also very supportive of the state flexibility what governor erisa wanted with his waiver so help me to understand particularly in my state with prescription drug or heroin issued is huge in the treatment provided that is through medicaid expansion how can we be sure to get as successful planned for. >> first of all vice support coverage they support people having coverage with with substance abuse or open new edition but if we look at the affordable care act coverage does not necessarily translate to access of care asking about the uber key driver he said it cannot do anything about it because $6,000 i cannot get to the doctor still cannot afford it. said that is a great story that coverage does not necessarily translate into access to remove to a different system keep that in mind we may need to pry high-quality care to provide accessible care what. >> but this is of at key issue for us. >> you have been very patient the committee has received several letters with that asked be added to record without objection ask any with in questions are submitted by 5:00 p.m. tomorrow for every 17 and with that the key for answers and your patience. we are adjourned. [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] president trump traveled to unveil the tree minor aircraft that boeing. after words he spoke to reporters

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