PRESIDENT'S FISCAL YEAR 2007 BUDGET FOR THE U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES WEDNESDAY, FEBRUARY 8, 2006 U.S. HOUSE OF REPRESENTATIVES, The Committee met, pursuant to notice, at 10:12 a.m., in room 1100, Longworth House Office Building, Hon. Bill Thomas (Chairman of the Committee), presiding. [The advisory and revised advisory announcing the hearing follow:] (1) ADVISORY FROM THE COMMITTEE ON WAYS AND MEANS FOR IMMEDIATE RELEASE February 01, 2006 CONTACT: (202) 225–1721 Thomas Announces Hearing on President's Fiscal Year 2007 Budget for the U.S. Department of Health and Human Services Congressman Bill Thomas (R-CA), Chairman of the Committee on Ways and Means, today announced that the Committee will hold a hearing on the President's Fiscal Year 2007 Budget for the U.S. Department of Health and Human Services. The hearing will take place on Wednesday, February 8, 2006, in the main Committee hearing room, 1100 Longworth House Office Building, beginning at 10:30 a.m. In view of the limited time available to hear witnesses, oral testimony at this hearing will be from the Honorable Michael Leavitt, Secretary, U.S. Department of Health and Human Services. However, any individual or organization not scheduled for an oral appearance may submit a written statement for consideration by the Committee and for inclusion in the printed record of the hearing. BACKGROUND: On January 31, 2006, President George W. Bush discussed several legislative initiatives when he delivered his State of the Union Address. The President will provide further details on these proposals on February 6, 2006, in his fiscal year 2007 budget, as submitted to the Congress. The budget for the U.S. Department of Health and Human Services includes important benefits and services such as those provided under Medicare, welfare (Temporary Assistance for Needy Families), child care, child protection, child support and other social services programs. In announcing the hearing, Chairman Thomas stated, "The President outlined several health and social service initiatives in his State of the Union Address that are under the jurisdiction of the Committee on Ways and Means. I look forward to hearing more about these proposals from Secretary Leavitt.” FOCUS OF THE HEARING: The focus of the hearing is to review the President's Fiscal Year 2007 Budget proposal for the U.S. Department of Health and Human Services. DETAILS FOR SUBMISSION OF WRITTEN COMMENTS: Se Please Note: Any person(s) and/or organization(s) wishing to submit for the hearing record must follow the appropriate link on the hearing page of the Committee website and complete the informational forms. From the Committee homepage, http://waysandmeans.house.gov, select "109th Congress" from the menu entitled, "Hearing Archives" (http://waysandmeans.house.gov/Hearings.asp?congress=17). lect the hearing for which you would like to submit, and click on the link entitled, "Click here to provide a submission for the record." Once you have followed the online instructions, completing all informational forms and clicking "submit" on the final page, an email will be sent to the address which you supply confirming your interest in providing a submission for the record. You MUST REPLY to the email and ATTACH your submission as a Word or WordPerfect document, in compliance with the formatting requirements listed below, by close of business Wednesday, February 22, 2006. Finally, please note that due to the change in House mail policy, the U.S. Capitol Police will refuse sealed-package deliveries to all House Office Buildings. For questions, or if you encounter technical problems, please call (202) 225-1721. FORMATTING REQUIREMENTS: The Committee relies on electronic submissions for printing the official hearing record. As always, submissions will be included in the record according to the discretion of the Committee. The Committee will not alter the content of your submission, but we reserve the right to format it according to our guidelines. Any submission provided to the Committee by a witness, any supplementary materials submitted for the printed record, and any written comments in response to a request for written comments must conform to the guidelines listed below. Any submission or supplementary item not in compliance with these guidelines will not be printed, but will be maintained in the Committee files for review and use by the Committee. 1. All submissions and supplementary materials must be provided in Word or WordPerfect format and MUST NOT exceed a total of 10 pages, including attachments. Witnesses and submitters are advised that the Committee relies on electronic submissions for printing the official hearing record. 2. Copies of whole documents submitted as exhibit material will not be accepted for printing. Instead, exhibit material should be referenced and quoted or paraphrased. All exhibit material not meeting these specifications will be maintained in the Committee files for review and use by the Committee. 3. All submissions must include a list of all clients, persons, and/or organizations on whose behalf the witness appears. A supplemental sheet must accompany each submission listing the name, company, address, telephone and fax numbers of each witness. Note: All Committee advisories and news releases are available on the World Wide Web at http://waysandmeans.house.gov. The Committee seeks to make its facilities accessible to persons with disabilities. If you are in need of special accommodations, please call 202-225-1721 or 202–226– 3411 TTD/TTY in advance of the event (four business days notice is requested). Questions with regard to special accommodation needs in general (including availability of Committee materials in alternative formats) may be directed to the Committee as noted above. *** CHANGE IN TIME * * ADVISORY FROM THE COMMITTEE ON WAYS AND MEANS FOR IMMEDIATE RELEASE February 06, 2006 No. FC-18 Revised CONTACT: (202) 225-1721 Change in Time for Hearing on President's Fiscal Year 2007 Budget for the U.S. Department of Health and Human Services Congressman Bill Thomas (R-CA), Chairman of the Committee on Ways and Means, today announced that the Committee hearing on the President's Fiscal Year 2007 Budget for the U.S. Department of Health and Human Services, previously scheduled for 10:30 a.m. on Wednesday, February 8, 2006, in the main Committee hearing room, 1100 Longworth House Office Building, will now be held at 10:00 a.m. All other details for the hearing remain the same. (See Full Committee Advisory No. FC-18, dated February 1, 2006). Chairman THOMAS. At the outset, the Chair wants to indicate to Members that there is a minor bit of a static problem in the Committee room, and the Chair would suggest that as Members sit at their seats, they might want to touch the metal knobs on their drawers prior to touching the microphones, because there is a chance that the microphones might short out. I will tell the gentleman from California, you can touch your mic any time you want. [Laughter.] Chairman THOMAS. This is the new and exciting technological age. Good morning. This was scheduled to be the second of a series of hearings on the President's budget. We were scheduled yesterday to hear from Secretary of the Treasury, Secretary Snow. Pretty obviously, the funeral of Coretta Scott King, quite rightly, took precedent over that. We believe the Secretary will be available to us on the February the 15th, and so we are in the process of rescheduling that particular hearing. This then would have been the second in a series of hearings, but is therefore the first, on the President's 2007 budget proposal, and the Committee welcomes the still relatively new Secretary of the U.S. Department of Health and Human Services (HHS), the Honorable Michael Leavitt. Thank you and we look forward to your testimony. In the world of health care, the Centers for Medicare and Medicaid Services (CMS) announced significant news last week. Due to strong and competitive forces, the average premiums paid by Medicare beneficiaries for the new prescription drug benefit are down 30 percent. They are estimated to be reduced from $37 a month to $25. This comes on top of the news that 21 million Medicare beneficiaries are now receiving their prescription drugs through Medi care. The Chair believes that by most reasonable standards, implementation of this program has been successful. The Chair would refer to a quote. This one actually refers to hospitals. "Hospital spokesmen say the reimbursement formula does not give them enough return, and that the future growth, and in some cases even survival of their institutions may be jeopardized." This comes from a New York Times article dated 1967. I think you will find, if you go back and look at the press articles in 1966 and 1967, focusing on the start-up of Medicare itself, there were always some difficulties in getting major programs under way, and the Medicare Modernization Act (P.L. 108-173), which included the new drug program, of course, is the largest expansion of the Medicare Program since its inception. So, we look forward to hearing from you, Mr. Secretary, about the progress in rolling out this program. The President's budget includes a number of proposals to help reduce the growth in Medicare. These proposals support our commitment to ensure that providers are paid accurately to secure the best deal for taxpayers and seniors. I am pleased that the Administration relied heavily on the recommendations offered by the Medicare Payment Advisory Commission (MedPAC). The Chair is also concerned about the accuracy of the current hospital diagnosis-related group (DRG) payment system. Last year, HHS acted on MedPAC's recommendations to base payments on the health of the patient, but only for some cardiac conditions in which there was an argument that doctors were performing procedures based upon the payment structure, rather than in the best judgment of a medical decision for the patient. As a result, the overall payment system has now been made more accurate in the area of decisions on heart operations, but remains highly inaccurate in other areas. I strongly encourage you, Mr. Secretary, to build on the progress made last year, and continue to apply a more sophisticated payment adjustment structure where appropriate, so that payments can reflect the acuity and severity of the decision made in the patient's health. We are going to look at a number of cost-saving provisions. There is going to be a lot of discussion. I do want to indicate that later today the President is expected to sign the Deficit Reduction Act (DRA) (P.L. 109-171). It reauthorizes the Nation's welfare programs, makes a number of provisions to help more low-income parents work and support the families. I assume there will be some questions directed to you, Mr. Secretary, on that program as well. I am very interested in hearing from you, but prior to that, I would recognize the gentleman from New York for any remarks he may wish to make. Mr. RANGEL. Thank you. I welcome the Secretary and his father here, and want his father to know that all remarks made at you are not personal, and that certainly we think you are a very courageous man to assume this great responsibility for your country. Most of our questions on this side will be to verify whether or not your office and this Administration truly believe that the government is incompetent in providing social services to American citizens, and whether they believe that the private sector, with its competition, can do a better job. More specifically, we would like to know, where is Social Security? Is it different from the last proposal? Are the private accounts still on the table? Is it going to cost a trillion dollars or more? We would like to know more about that as we move forward with this year's work. Health Savings Accounts (HSAs), is this another example where we want to get rid of entitlements, get rid of Medicare, and allow individuals to be more in charge of making the decisions and bolstering up the private sector to assume the responsibility that Medicare has. We want to know whether this philosophy has folded over into the way we have provided funds for the private sector and prescription drugs, and whether or not you think that the HSAs would have any better way of distributing health care as we found the pharmaceuticals and the Health Management Organizations (HMOs) in dealing with prescription drugs. We want to know why you are cutting money out of the budget for the block grants in social services, which once again, as the cuts that we have on the floor, will be hitting those families that have the aged, the disabled, the children, and how do you think that is going to help us? I hope that in your opening remarks that you could let us know philosophically where the Administration is going because people are suffering, and if we are going to depend on the private sector, |