and get him on the floor and to the job as soon as possible said johnny issacson who is the chair of the senate veteran after fairs committee. many urged president trump to retain former v.a. secretary bob mcdonald to continue his work on those issues. mr. shulkin is going to appear before the veterans after fairs committee live beginning at 2:30 eastern. and now, a hearing on the efficiency and the effectiveness of the medicaid act and concerns over waste, fraud and abuse of the state's management of federal funds.

good morning, everyone. welcome to the newly refurbished, excuse me, well, i want to call it the oversight investigation committee room which is sometimes used by energy and commerce, and what a but beautiful room. it is more conducive to the good hearing. this is the the first one of the 115th congress and welcome here, and welcome in the witnesses today. this is the -- and welcome back to my friend and colleague ranking member from colorado. this is our medicaid oversight committee on existing problems and ways to strengthen the program. we are convened to examine a critical component of the

affordable care act, medicaid and medicare expansion. it covers over 70 million americans and accounts for more than 15% of the health care spending in the united states. in 2015 alone, the federal taxpayers spent over $350 billion on medicaid and the costs continue to rise each year according to the congressional budget office, and the shares are expected to rise significantly in the coming the decade from $371 billion in 2016, and to $624 billion in 2026, ten years. at a time when the medicaid costs are skyrocketing, and asking the question, is medicaid serving ad quay will the most vulnerable populations? it was originally designed to be a safety net to provide care for the vulnerable populations -- children, women, and mn and women with disability, and for

many who have not received medicaid, people with d disabilities would have struggled. and so these restrictions surrounding medicaid do not allow the doctors and the nurses to have the flexibility to arrive at the best outcomes. many of them do not use the physician-focused alternative payment models to reduce costs. and many say that medicaid costs do not result in better outcomes. one cited study in oregon said that it improves self-reported health and mental health with no effect on mortality or physical health. similarly, the national bureau of economic statistics found that there is only 30 cents to 40 cents of each dollar that the federal government spends. and reports of nonpartisan watchdogs, two of which are here today show that the medicaid program is a target for waste, fraud and abuse. because of the size and the

scale of the program, the imp p improper payments and including payments for people not eligible for medicaid or services not provided are extremely high. the government accountability office i says that medicaid paid out over $17 billion in fiscal year in 2015 alone. to these reasons, it is dedicated as a high risk program by the jao in 24 years since 2003 and despite the longstanding problems in the medicaid program, the health care affordable act is to be expanded to a whole new population, and medicaid benefits have been opened up to adults for age 65 to make less than 33% of the poverty level. and since the enrollment began roughly 11 million americans have signed up under the new eligibility parameters which means that the majority of th r

obamacare. and the enrollee care has been far more expensive than the obama administration predicted. the average cost of the expansion of the enrollees was 50% higher. the average cost is $6,366 in fiscal year 2015 which is 49% higher than aca predicted the year higher. that means that not only are the expansion enrollees are, pensive to ensure, but the costs are unpredictable, and the higher rate, the tax payers are on the hook for the vast majority of the expenses associated with the new enrollees and the reports show that both states and federal government cannot effectively oversee the medical expansion and the gao found errors in determinations that could lead to the misspending of funds. and likewise, the inspector general found the troubling evident that they failed to implement the requirements of

the patient implementation of the affordable care act, and to improve integrity and root out waste, fraud and abuse. and while we acknowledge the deficiencies in how the program relates, it is the responsibility of the federal government the provide a safety net for the most vulnerable among us to make sure that the taxpayers' dollars are best serving the medicaid population. we want it to work. not to hinder the services. i want to bipartisan way support the strengths, and find the problems and find solutions. tomorrow, the health sub committee is going to find solutions to strengthen medicaid, but as we move forward, we have to make sure that we don't repeat some problems that exist in the program. as we will hear from the witnesses today, we have a lot of work to do and i would like to the thank the witnesses to appearing today, and look forward to the discussion, and turn to the ranking member for five minutes. >> thank you, mr. chairman, and it is good to be back for

another session of congress. we have two new members on our side of the aisle in the subcommittee this year, and i am happy pi to welcome them. dr. ruiz is an actual emergency room doctor who will be able to bring us so much great perspective on the hearing and other hearings and then scott pe peters who is not here at this moment, i'm pleased that he is here. he and i comprised 2/3 of the nyu law graduate delegation to congre congress. so i am here that we are loading up the committee with nyu law grads. so i think that i would be deceiving myself if i thought that today's hearing was intended actually strengthening the medicaid program, although i hope it is not so. i fear that this discussion about medicaid is intended to lay the groundwork for drastic

cuts to the program, and eventually to appeal the affordable care act historic medicaid expansion. i'd like the talk a few minutes about the importance of the program, and what medicaid expansion has accomplished for the american people. today, more than 70 million low income americans including senior, children, adults and people with disabilities have k access to quality health care thanks to medicaid. c contrary, frankly to, what my colleagues on the other side of the aisle believe, medicare delivers care efficiently and the costs are actually substantially lower than for private insurance and growing more slowly per beneficiary. numerous studies have shown that medicaid has helped to the make millions of americans healthier by improving the access to preventative and primary care, and to management and identity fi serious disease. so it saves lives.

research in the new england journal of medicine reported that previous expansions for low income adults in arizona, new york, and maine reduced deaths by 6.1%. the aca's historic medicaid expansion have let the states build on this record of success, and provide assurance to millions of americans who otherwise would not have had access to health care. and last year and we need to think about this, more than 12 million low income adults had health care coverage because of the medicaid expansion. this is astonishing and combined with other important provisions of the aca this has helped to drive the uninsured rate to the lowest level in the country's history, and it is important to know that it is not people who have shifted from private insurance to the medicaid expansion. this is people who had no insurance, and they were using the emergency rooms as their

primary care facilities. in colorado the rate of the uninsured was cut in half since the enactment of the aca and the expansion of medicaid. has actually resulted in tremendous savings for the states. hospitals nationwide have seen their uncompensated drop by $10.4 billion since the aca became law. their up compensated care claims fell by 30% since passage of the aca, this is real savings, also we know that medicaid is helping people get health care services. i had a session in denver last week about the aca, i had 200 show up at the listening session and most of the people who told

their heart rendering stories were employed but couldn't afford insurance, they had services for catastrophic accidents they had had and on and on. it got to the point where i literally had to take a packet of kleenex out of my purse and put it on the podium because everybody including my staff and myself were in tears listening to these stories. this is what the majority wants to take away and this is what we're talking about. we can all talk about eliminating fraud, waste and abuse in the program and we're all for that and would support that 100% but taking away vital health care for so many millions of americans is wrong and i yield back. >> we don't have anybody else on

our side of the aisle who wants to give a statement. perhaps mr. pallone do you want to be recognized for five minute s . >> thank you mr. chairman, it's great to be back in our room here today. it looks really nice. for seven years now congressional republicans have railed against the affordable care act with a steady drum beat of repeal and replace and sabotaged implementation of the law and leading the public with falsehoods of the mis failingfa the subcommittee should be known about the impact it would have on the americans and the system. but they highlight the laws of the medicaid expansion despite

it is made available and afr affordable for the first time nationwide. tomorrow is what is considered to be the first pieces of the g.o.p. replacement plan. it will not prevent them from losing their health care coverage -- successfully repeal the affordable care act. they are creating on certainty and instability in the individual market. this instaability the republican made chaos in the health care system has already gun and of course we're seeing the same thing with the president's immigration executive orders. i just hope that at some point our g.o.p. colleagues join us against what i consider reckless and rash actions and oppose

president trump's actions. c congressional republicans continue to ask the american people to trust them and they have a planned somehow everything will be okay and repeatedly assured the public they will not lose their insurance, but recently released audio at a closed door meeting from the republican retreat meeting last week confirms they simply have no plan, they admitted it could avis rarate f those covered under the medicare expansion. one warned and i quote we better be prepared we are willing to live with the market that this will reveal. the american plan -- republicans are so scared to own the chaos

they're causing that they're trying to pretend that the law is imploding on its own which could not be further from the truth. americans today have better health coverage thanks to the affordable care act. it has improved the quality and accessibility for millions of americans and my colleagues would be wise to consider the impact their actions would have for the current millions benefitting from the affordable care act. it would realize the affordable care act should not be repealed. i say this because i don't care about the ideology, the fact is real people are going to be harmed if the affordable care act is repealed. and hope at some point my republican colleagues will admit that and we can work together to improve the health care system. >> we move forward with our witnesses. i want to ask unanimous consent

that the opening statements be entered into the record and documents introduced into the record. first up we have miss carolyn yocum, at the u.s. government accountability office. and anne maxwell, inspections of department department of health and human services office of inspector general. and paul howard director of health policy at the manhattan institute as well as mr. josh arsham arshambo. timothy m. westmoreland professor on the georgetown university. thank you for coming, looking forward to hearing from you on this important issue. doing so has the practice of

taking testimony under oath. do any of you have objection to testify you should oath. see in objections. under the house rules committee and to be advised by counsel? do you prefer to be advised by counsel? >> i see no objection. swear you in. do you swear that the testimony you are about the o gio give is truth, the whole truth and nothing but the truth. all affirmed. section 1001 of the united states state code. -- is there some lights that will go on for them when they are -- we'll see. is there something in front of you, green means keep talking, yellow means you're time is

about up. >> chairman murphy, ranking, members and members of the subcommittee, it's a pleasure to be here today to discuss actions needed to prevent improper payments in medicaid. medicaid finances health care for a diverse population including children, adults people who are elderly or those with disabilities. also offers a set of acute and long term health care services. medicaid is one of the largest programs in the federal budget an one of the largest components of state budgets as well. in fiscal year 2016 medicaid covered about 70 million people and federal expenditures were projected to total about 363 billion. unfortunately over 10% of these over 36 billion are estimated to be improper, for services not covered by the program, were not

medically necessary or never provided. the program, size and diversity make it vulnerable to improper payments. it states our first line of defense against improper payments. they have responsibility for screening providers, detecting an recoverying overpayments and referring suspected cases of fraud and abuse. at the -- level they over see integrity efforts. in 2010 the affordable care act gave states an provider and integrity oversight tools and provided low income americans new options for obtaining health care coverage. through possible expansions of medicaid or through exchange a marketplace where individuals may compare and purchase health insurance. my statement today focuses on four key medicaid program integrity issues that we have

identified. steps cms has taken and the related challenge of the agencies and states continue to face. first, with regard to ensuring only eligible individuals are enrolled in medicate cms has taken a variety of steps to make the process more data driven yet gaps exist, including enrollment for those eligible as a result of the expansion. as one example, we found that federal and selected state based marketplace has approved federal health insurance coverage and subsidies for nine of 12 fictitious applications made during the 2016 special enrollment period. second efforts to improve oversight. cms provided states with methods of identifying improper payments made to providers and in active response to recommendations

requirements for states to audit managed care organizations an providing states with additional audit support, but further actions are need. in particular, in counter data which allows them to track those in managed care are not always timely or reliable. third cms has taken the steps of screening providers, there are new risk based initiatives for over seeing provider checks and these are important steps, but there are -- in place to share providers who are ineligible for coverage. lastly cms has implemented policies to prevent duplicate

coverage, since our report cms has started doing checks on duplicate coverage to at least two times a years, this could save federal and beneficiary dollars but cma needs to develop this broadly and make sure of the efficiency of these checks. in closing, it is important for healthcare of tens of americans it's long term sustainability is critical and requires effective federal and state oversight. thank you members of the members of the committee. this concludes my prepared statement. i would am prepared for questio. >> thank you for the opportunity to appear before you today to protect tax payers, and

patients. from medicare abuse. it can be very complex and on one instance we indicted 30 nursing homes that billed for services that patients didn't need. in another example reconvicted a doctor for writing fake prescriptions, expensive drugs then sold on the black market or billed to medicaid. this is exactly these types of schemes that highlight the need to protect medicaid against unscrupulous providers who steal at the expense of tax payers. i want to highlight what we can do to protect these schemes and other vulnerables. cms share responsibility for funding as well as protecting medicaid and we recommend they focus on three straight forward program integrity principals.

prevent, detect, and enforce. first and foremost, cms and states must prevent fraud, waste and abuse focussing on prevention is critical and common sense but medicaid programs sometimes fall sohort and end up chasing providers. state agencies should no who they're doing business with before they give them to green light to start billing. to help with that rerecommend states implement full background checks, and elect accurate data about providers in addition to spren preve prevent incorrectly paying

providers, we believe in updating their systems. the ability to detect fraud waste and abuse in a timely manner accurate data is an essential tool for doing this however as we have just heard, national medicaid data including data from managed health care companies has insufficiencies, it is to detect fraud, patient harm and even protect oversight but ineffective without accurate timely data, without the data states cannot see the whole picture. we found providers enrolled in one state medicaid program that had been terminated by another state but without shared data states had no way of knowing this and had to find out the hard way they had enrolled fraudulent and abusive providers. finally, it's imperative to take

swift and appropriate action to correct problems as well as to prevent future harm. federal and state enforcement efforts have very return on investment revealing annual -- and penalties on thousands of wrong doedoers ever year, inclu spending provider payments and terminating providers where appropriate. state units lackey authority. currently these units can investigate allegations of abuse that occur within institutions but if it took place in a home or different community setting they cannot. medicaid patients receiving services in their home should have as many protections as those in institutions. in closing, our work reveals a number of opportunities to

improve medicaid safeguards. in particular a heightened focus on the program integrity principals of prevention, detection and enforcement will help protect medicaid now and as it involves prioritizing medicare integrity are to ensure they are used as intended to provide services and long term nursing home care for those most in need. we appreciate the commitment and we have seen it strengthened in congress and we hope to be a catalyst toward work for a positive change. thank you. >> mr. howard you're recognized for five minutes. >> thank you mr. chairman, ranking members. medicaid is undoubtedly a vital component to have nation's safety net for low income and

vulnerable populations but an open-ended automatic matching formula has vast unintended face call consequences for the states and federal government often crowding out safety net services and supports that might have a bigger impact on the measured health of these populations and continued economic mobuilt. as you know medicaid is a hybrid program that pays 62% of its match. the lowest match is 50%. this encourages to drawdown numbers sometimes through a legally questionable funding designs that my colleagues have just mentioned. this busien teteen structure, ms it difficult to over see integrity, and encourages

wealthier states to drawdown on dollars. in a 2010 book, it was highlighted that the states spent 90% more than the lowest quinn tile of states. when it comes to fraud and abuse we see new york state which has historically spent much more of the other states it spent approximately 11% of total medicaid expenditures and spends 44% per enroll eenrollee, the s over paid by $15 billion simply because of payment structure that the state and federal government agreed to in 1990 that was never updated that moved the disabled out of the centers and into community supports. to the state's credit, there was

a redesign team that began to address the program first by conceding it offered beneficiaries for tax papayers, including kapg mo including capping most of the state spending, lowering it from 6.2% to 4% the state saved hundreds of millions dollars and shifted from institutional care to community care and begun to address some of the poor health that leaves these people disproporti disproportion natalnatalie in eemergenci emergency room. support of housing for the seriously mental ill or any other support or service that might have a bigger impact on

improving measured health outcomes, my colleague warren cast last year put out a study from 1975 to 2012 our spending had doubled but 90% of tincreas had gone to health care, either bier enrollment or per enrollen, we could save as much as $100 billion annually. in short, we have thickened one strand of our safety net for low income americans while neglecting others if a safety net feels threadbaren it is because we have encouraged states to over spend. what i'm not saying is that medicaid has no value. it shows it has extraordinary returns on child health and --

other studies continue to show that the social determinants of health have a much bigger impact on mortality, asthma and cancers like lung cancer, than spending money on health insurance per se. in conclusion, we should agree on bauder safety net goals that hold the states responsibility that are transparent between the state and federal government, refine them to ensure we're not a automatically funding for health care, and finally cms should continue to give more leeway in programming, designing and spending medicare health care, i believe these would support liberal ends and support the

115th congress. thank you very much. >> chairman, murphy, ranking member and members of the committee. i work for government accountability a think tank active in 37 states specializing in health and welfare reform, i would like to highlight how it has worsened for the needy and would like to start with a video. >> for nearly her entire life she's one of thousands of a waiting list that state leaders are looking for ways to trim. tonight, jason shares some ideas. >> a year ago schuyler overson was given a months to live, a life racked by a rare neurological condition. she requires 24 hour care.

>> i'm in bed right after her, people don't understand how much care they need but also don't understand how important it is. >> a medicaid waiver would pay for that over 4,000 arkansas families have one including the overman's are waiting for one and it's a long wait. >> she's still 670s so she's moved less than ten spots in nine years. >> that's a sad fact that at the rate it's going there are people that will die before they get to receive their services. >> sadly schuyler's story represents just one of nearly 600,000 individuals currently sitting on waiting lists for medicaid services individuals with developmental injuries, traumatic brain injuries, and

mental health disorders and less likely to receive care. it expand today a brand new population which consists largely of child, able bodied of working age and only dimmed hope for families like schuyler but the problems go much farther beyond situations like hers, the governor of arkansas has proposed nearly a billion dollars in cuts compared to traditional med ma-- medicaid needs. why is this happening around the country? it is awarded a higher match rate. this funding formula has per nicio pernicious return. it's the biggest line item also

growing faster than revenue. if you want to save one state dollar on state funds on average you need to cut 2 can dollars, the aged, the blind, pregnant and disabled women and children. but if they want to save $1, this year they need to cut $20. i know you all can guess who faces cuts first and it's heartbreaking. over enrollment under obamacare's expansion will cut into deeper cuts, it shows enrollment has been by over 110% on average more than double than estimates. california found themselves 222% over budget. ohio $4.7 billion or 87% over

budget. this means fewer resources for the truly needy, history could have warned us of this, arizona and main warned us before the aca and both had to take measures to reign in costs. arizona had to stop a number of organ transplants. created wait lists this happened even without the lopsided extra funds that enrolllee, concerns over eligibility issues, they have found deep systematic problems, first states need to be checking eligibility far more frequently. and data much more frequently. moving out of state, getting a raise or a death have gone unnoticed far too long and meanwhile states continue to cut

checks for managed care companies for states that no longer are needed. >> i recognize mr. westmoreland for five minutes. >> mr. murphy and members of the committee, thank you. i take a backseat to no one on the medicare program. people who care about them need to make sure federal funds are well used. they are however not new. military contractors cheated the union army during the civil war where money is being spent whether it be private, state or federal and no matter how good the cause there are bad argumenactors trying to steal it. billions of dollars are at stake as are the health and wl being of the most vulnerable people in

america. this is illustrated by the fact at the same time aca expanded coverage and integrity efforts but as important as combatting fraud and abuse as it is, policy merricks shou makers should keep it in perspective. first we should be careful about our terms, not all of what is labelled improper payments in the vernacular is fraud or even mistaken. most are appropriate but simply bad documented and may even be under payments. and the actual loss to the government is much smaller than it may appear the lig and ag have testimony to my site to this terminology, but as the prepared statements have outlined hhs has implemented

serious programs of integrity, some are long standing and some just underway, but there are efforts to make sure medicaid is spending money well and having an effect. but i am concern that policymakers often face fraud and abuse with the wrong targets. any dollars stolen or miss spent will reveal that the major w culprits are unscrupulous providers. doctors dentists and clinics that provide unnecessary services if they provide services at all. but all too frequently the political and legislative response is to institute cuts or restrictions on beneficiaries and the providers who actually care for them. there's simply nothing in revent reviews of program integrity that justify the policy proposals on the table an before this committee.

reduced capped federal funding does nothing to improve program integrity but it does put coverage at risk for low income americans abed shiftds t americans and shifts it to states and localities. for example, the medicaid expansion of the aca means that 11 million people have medicaid coverage who did not have it three years ago, the percentage of people without insurance in america is all time low 8.9%. the burden of uninsured is relatively lower rural hospitals are at risk of closing. people with serious mental

illnesses are 30% more likely to receive services in expanding states. and opioids -- often working for the first time. it has fundamentally prepared in a long standing statement. people always had to fit into a e category, but never made sense. women need health care before and after having babies, poor children need health insurance even after 19, poor people need insurance before they become disabled. poor older adults need care when they're 64 not 65. of the 32 states that have adopted the expansion, where it finally makes sense and be fair for vulnerable people. please do not turn back this

response. lincoln did not give up on the civil war because the government was sold bad mules. we do not stop buying drugs because drugmakers charge fraudulent prices, we get help people need. -- demand wholesale changes in medicate. there are real babies in that bath water. >> thank you. >> i recognize myself for five minutes of questioning. miss yocum. your october 2015 report found gaps to check for different eligibility groups, the newly eligibility expansion and previously eligible are appropriately matched with federal funds. in the federal exchange dates cms will not be able to assess the accuracy of eligibility

until 2018 does this create the situation for improper payments? >> it does create what is going with eligibility on whether process is being made. the decision to suspend the estimate of eligible was trying to give states to understand the new rules a tnd matching range that could be applied. but transparency of the process and how it is proceeding is it would not be a bad thing. it would be good to know what's going on. >> thank you. in states that determine eligibility. jao found eight of the nine states identified eligibility determination areas in improper payments, are those reflected in the eligibility error rate and does cms correct these and if

not why not. >> right now they are not reflected the estimates that cms puts out. instead there was a rate that was produced a couple years ago of 3.1% and applies to 2018. >> why 2018? >> i'm not sure. >> is that an accurate number that's being applied? >> it's a number that goes back to 2014. >> so just continuing that on. i've heard cms put a freeze on eligibility medicaid, what does this freeze mean and how will we measure eligibility and improper payments? >> it means we're relying on an error rate three or four years old an we don't know what's

going on right now with the eligibility payments. >> so we're going -- asking what the error rate and we say we don't know we're using a number from a few years ago? >> that's correct. >> and so if a parent ask a kid how did you do on your report card and they said i got all as, but just assuming i'm going to care this over year to year and i'm a valedictorian. >> they are working with a state by state basis. >> so if somebody makes a statement, everything is fine, we have inaccurate data, we want to fix this but we don't have accurate day toot know how big e

problem is? that that is correct. >> let's try and get an idea of the types of eligibility errors and how much they cost the federal government. do you have any examples of your work from improper eligibility and how that translates to improper spending? >> sure. and in my written testimony in 2012 they hired a third party vendor to track them. from the first year they found about 300,000 individuals eligible for medicaid and second near they found 400,000 ineligible for their program and it run it is gamut from individuals who passed away from the 1980s who were still on the program, to individuals who moved out of state, got a raise, didn't report the information. state of arkansas also did a review of their medicaid program an found things like 43,000

individuals who didn't live in the state who were remained on their medicaid program, 7,000 who had never lived in the state. >> are those people making medicaid claims do we know? >> in many cases this is why it's so important and as states move toward managed care environment it doesn't matter they continue to cut checks regardless whether they are showing up to the doctor or not. >> hundreds of thousands of people are in this category that they're still getting paid even though they're not alive in the state or getting care? >> correct. in some cases it's just waste. if somebody moves and is still medicaid eligible we want to make sure two states aren't paying two managed care company for their care, in other cases it's outright fraud. >> do you have a dollar number? >> it's hard to say, but we go through a number of state audits

that show eligibility is a huge issue when it comes to applications. >> thank you. >> mr. chairman. you talk about the complex investigations your agency is under taking into the medicaid fraud issues. these involve large numbers of personnel and also technical support, is that right? they're complex investigations, correct? >> absolutely. we partner with the state medicaid fraud units. >> do you know approximately how many people at your agency are involved in these investigation? >> in some respects we all are, we are lawyers, evaluators and all of us contribute to the fraud issues. >> are you familiar with the

statement that mr. trump gave -- no new positions may be creates except in limited circumstances. >> i am familiar with that. >> has your agency determined will that freeze the hiring at your agency? >>iven it's quite n >>iven -- given that it's new, we don't know. >> if you -- if the personnel at your agency was the hiring was frozen what will that do to your on going fraud investigations? >> we would need to double down and do as much as we could with the resources that we had. >> would it impact those investigations? >> absolutely, we need the personnel to analyze the data in order to fight fraud most effectively. >> thank you. i wanted to ask you a quick question mr.chambomb you

showed that heart rending tape of that young girl who was on a hold for the care and she was in arkansas is that correct. >> yes. >> and they decide how they're going to use the medicaid money that comes to their states isn't that correct? >> within limits. and the government sets the guidelines. >> but the governor of arkansas decide w decide where that money would be spent and decided not to put it in that program, is that right. >> the governor decided how to allocate that money yes or no? >> they have funds that come in and they can decide to invest on a wait list. >> and that's the governor that decide that. >> on a none expansion state. >> thank you very much, yes or no would have worked. >> i want to ask you mr. west

westmoreland a couple of questions, hospitals pay for patients that cannot pay their bills is that correct. >> yes. >> who pays for uncompensated care? >> the direct costs are usually born by state and municipal governments because they pay for public general hospitals. >> where do they get their money from. >> largely from tax payers. >> okay, i talked in my opening statement about how the aca medicaid expansion is driving uncompensated care costs lower, can you briefly explain why that's correct? >> yes. if a hospital is dealing with people who have no source of insurance it be and large can provide services and chase them down and people often times have no money or declare bankruptcy in the instance they are insured the hospital can turn to a third

party payer and they where no uncompensated care. >> okay, now some of the states that did not expand the medicaid component have not experienced a larger reduction of uncompensated care cost, is that correct? >> yes. >> why is that. >> those states are still deali dealing with the same number of people with low income, they have the medicaid program the expansion system largely paid for by the federal government. >> great. thank you. i yield back. >> and now recognize mr. barton for five minutes. >> thank you mr. chairman. i'm glad to be a part of the first oversight hearing. i'm glad we have some new blood on the subcommittee. we have a new doctor on the democratic side. we have dr. burgess on our side,

so when the blood letting begins we'll have two doctors that can take care of us. and keep us going. i wanted to focus the panel's attention on a few numbers first number is 20 trillion. second number is 325 million. our national debt is about $20 trillion give or take a trillion or two, we have 325 million americans in you divide it into 20 trillion you get act 66, $67,000 that every american owes of the national debt. it says there's 70 million american covered by medicaid b subtra subtract that from the 325, it

means that also the $66,000 times 70 million that the medicaid recipients owe, they can't pay it back, those are big numbers we are spending at the federal level about $350 billion a year and the states are adding another 150 billion so we're spending about 500 billion a year to provide health care for low income americans. that may or may not be sustainable but we know that we can't sustain adding half a trillion to a trillion dollars every year to the national debt. we all want to keep medicaid. but we want to improve it. and that's what this oversight subcommittee is looking at. how do we improve medicaid so that we get more bang for the

buck real health care to the people that need it and yet make it affordable so the taxpayers who are funding it can continue to fund it. mr. howard, you talked about in your opening statement a little bit about new york with 6% of the population getting 11% of the medicaid dollars. you want to explain to the s subcommittee why that is so or would you like me to explain it? >> thank you congressmen, because of ideology and a larger tax base, and inhibits to -- program efficiency, in a state like new york, say they want today design a more efficient care program that saved a million dollars because of the 50% match it would have to cut spending by $2 million.

so it tends to up bid but makes it very hard to turn it around and correct it and find more ways to deliver care an i think that's a challenge facing the nation not just for medicaid but medicare as well. in an environment where there's no incentive for providers to look outside the box in new ways to deliver care more cost effectively they simply don't pursue those areas i think some of the changes that governor cuomo instituted in new york, if it was a republican you would hear a howl. you do things that are very quote unquote progressive and i think the government should look at ways to give them more government incentives.

and efficient ways. >> do you think it would be better to try to harmonize it with low income populations across the nation? >> i think states would also really appreciate the opportunity to be able to spend medicaid dollars op non-health related supports that miegtd actually in terms of accessing transportation or other services that might make those populations in long term care i think they would be open for that. >> i'm going to have questions for the forward dealing with block granting programs back to the states, i do want to welcome mr. westmoreland back to the committee. nobody has admitted it but one point in time he was the brain trust on the minority side and helped mr. waxman create the affordable care act an we appreciate your expertise.

>> it's nice to be back in 21-23. >> thank you, mr. chairman. my questions are to mr. westmoreland. there was a claim raregarding o individual's experience in arkansas on the waiting list and i'm concerned that his testimony attributed a causal relationship between medicaid expansion and somehow the medicaid expansion exacerbates the weight list, i don't think it shows that it's true. i think the wait lists are a result of state decisions and cutting or capping or blocking medicaid will only make the situation worse and i would like to use anecdotes one year i went to a conference a couple years ago in houston with mr. green, i think mr. burgess was there too

and in between the health conference i went over to the texas children's hospital at the medical center. and you know, i talk today ted officials there, a beautiful a place with this beautiful lobby, but particularly mothers with their children were just literally camped out in the lobby of this place that looked like a hotel an i asked why are they all here and i was told they couldn't access the emergency room because there were so many people that they were literally waiting for hours to get care for their kids so this notion that the medicaid expansion is causing it i think is just the opposite i think it's the lack of medicaid expansion that's causing the problems in most situations. in any case, let me just ask you some questions mr. westmoreland can you provide background on the waivers, isn't it true to

have an hcbs waiting list is the state flex biibility that is th direct result of the amount of resources states make to provide hcbs? >> yes. there's no how much a state may turn to hcbs as posopposed to or limitations. >> if they create waiting lists once the slots are fill and cms allows them to increase or decrease the number of slots as they wish, isn't it true in the case of arkansas the federal government would be willing to pay 69% of the care and until january of this year the state was spending none of its own funds on the expanding population? >> i have to admit i don't know

the last part of your question, but other than that yes, it's entirely the decision of arkansas and the waiver. >> and isn't it true that the district of columbia have no waiting list at all and that the majority of those that have no waiting list have also expanded medicaid. >> i believe so, yes, sir. >> isn't it also true that the longest waiting list states are texas and florida which have not expanded medicaid i use my example at the texas children's hospital, these are the two states have that the longest waiting list. >> i know texas and florida have not expanded. i did not know they were the longest. i did know they have waiting list. >> my problem is i think there's no evidence that states are choosing to expand medicaid or keep their expansions at the expense of examining choices on both expansion and hcbs waivers

leads to a contrary conclusion, if anything all the expansion dollars only strengthen the revenue and improve the finances of providers by edusing uncompensated care as has been shown in multiple states around the nation. it just makes basic sense if states expand medicate they're getting more money to care for people it's only going to be natural they have more money to spend on people who are eligible so this notion that somehow by cutting the expansion or cutting medicat medicaid there's no way in the world that's going to help people seeking care, they're going to end up in an emergency room, they're not going to get preventive care, they're not going to see a doctor. none of it makes sense. >> if i may, i would like to

juxtapose your comment with that of chairman barton whom points out that possibly there will be proposals to block grant and cap the federal funding and i have to say if the congress adapts cap funding for medicaid we're going to see more not fewer waiting lists, less funding and the loss to entitlement of services is exactly what's underlined in the story in that video. and if it's limited it will only get worse, not better. >> thank you. >> now i recognize the new vice chairman of the subcommittee i griffith. >> you were saying that the states have to make choices with their limited resources anned that the federal government under the aca is going to lower its medicaid expansion money down to 90% as states find themselves with larger burdens

than anticipated they have to make decisions on where it's cut and we have created through the aca and i say loosely because i wasn't here when they vote ond that but the congress and the government and the states are rewarded for dealing with medicaid which deals with children and people who are in greater need and that because of that disincentive or incentive to spend it on the new folks the newly found under medicaid under the new categories, we create the situation where states are having to make a decision as to whether they quicken the shortage on the waivers get rid of the waivers as fast as they can or spend the money somewhere else was that my understanding? >> correct. there's both direct and indirect outcomes related to expansion and my point is we are not fulfilling the promises to the most vulnerable in our society

wait list or not. we are making promises to an able bodied population that does not qualify and states are being put in a situation where they're having to make very tough decisions in making cuts and reimbursement rates that directly impact those with disabilities, those in nursing homes, the access in qualities have surrounded nursing homes in decades will truly get worse for the needy. >> so what you're saying is we need to pay attention to that and have incentives to encourage people to take care of the truly needy and maybe the new group needs to reformulate is that what you're saying? >> absolutely, going forward we would strongly looking at freezing new enrollment in expansion states to address this

underlying focus of -- >> we have a real reason for that, and the reason i said get your money out was very instructivechamboarchambo. we have a situation even in traditional medicate we have rewarded states that play games virginia elected not to have a sick tax that's what it was called when there was a proposal a number of years ago, a couple decades ago to tax the bed os-tos of the sick and get matching money from the federal government would have given us those $2 for money we have collected from sick people but many have come one the skeechemes to get money can claiming their charging more but creating a sick tax scheme an overtime i'm not saying get rid of it immediately but

overtime get rid of it so everybody knows exactly what they're getting and not having to charge sick people for money to get the more money for medicaid? >> it has capped that states have been able to use but i think the last estimate was about $25 billion. they use it for intergovernmental transfers. >> there's some real ethical questions about that there. >> absolutely. >> because i want to move on to something else. you heard somebody else say that obamacare wasn't collapsing and that was some myth. 25% average increase, nearly a third county, have only insured taxes 1.47 million americans have been kicked off their health care. happened to me twice, after a

church group went out, i try to stay out of politics, a discussion broke out where i was not involved talking about what do we do as we go forward and one fellow said as a christian i don't mind paying more money but when my insurance have gone from $450 a month to much more and getting less coverage, that's a big problem. there was a discussion about spending money for the daughter with the flu several families have been ravaged by the flu, it was going to cost them $75 to get tamiflu. these are real life kpaexamples how obamacare is affecting real

people. i yield back. >> thank you mr. chairman, thank you goodness for medicaid in america. especially back home in 3.6 million floridians rely on medicaid for their health services, a lot of my neighbors in skilled nursing, alzheimer's patients, medicaid is the lifeline for these families. not to mention 50% of children in florida rely on medicaid, to go seat pediatrician, and get their checkups, along with the state children's health insurance program. and florida didn't expand medicaid, so that 3.6 million number are really -- neighbors in nursing home or community-based care or children or my neighbors with disabilities. and based upon what they tell me, medicaid is working for them, it works, medicaid

spending growth is lower than private health insurance, it is lower than medicare, that's because sometimes states try to get by on the cheap and paying providers, that's one place for reform that we could improve access if we would pay our providers a little bit more and do better there. medicaid is flexible. i watched in florida as they moved to a managed care system. i have questions about that. but that was a decision of the state, they had all that flexibility under medicaid. they also began a change towards more home and community-based services to help keep older folks out of skilled nursing, which can be very expensive. then, but we have to remain mindful about the fiscal cost, and fiscal responsibility. that's why in the affordable care act we passed a lot of new program integrity provisions to strengthen medicaid. the most important provisions involved a shift from the

traditional pay and chase mod toll preventive approach by keeping fraudulent suppliers out of the program before they can commit fraud. all participating providers and medicaid and chip programs must be screened upon enrollment and revalidated every five years. think about that as you move toward repeal of the affordable care act, why would we want to repeal these important program integrity provisions relating to medicaid? i don't think that's the path that we all want to go down. what this is, though, i think the real fear is that this whole terminology of block grants, per capita caps, is simply a stalking horse for less care for my neighbors back in florida and all americans, every alzheimer's patient, every child that needs to go see the pediatrician, i want folks to be aware what block grants and per capita caps means. because it sounds good. but what that means is

devastation and sabotage to the medicaid program. mr. westmoreland, describe the impact on the delivery of health care services to americans if this approach is taken, block grants and per capita caps. >> as i understand some of the proposals that are made the basic point is to limit federal participation in the state costs of running the medicaid program. as health care costs grow over time, the states will be left holding the bag for those increased state costs. for medicaid costs. and as changes occur, in the population, as the baby boomer demographic enters into the population, as more and more services are provided for people with disabilities, as prescription drugs costs go up, the increased cost over time will not be matched by the federal government. states will be left holding the bag. >> isn't it interesting that

some republican governors believe this approach will have disastrous consequences for their ability to care for their older neighbors and neighbors with disabilities and children, for example, govern, republican governor from massachusetts in a letter to congressman kevin mccarthy stated we're very concerned that a shift of block grants or per capita caps for medicaid would remove flexibility from states as they the result of reduced federal funding, states would most likely make decisions based mainly on fiscal reasons rather than the health care needs of vulnerable populations and stability of the insurance market. could you elaborate a little more what this would mean? you would have, in my state they may not raise taxes, that's the choice, though, isn't it? raise taxes to support -- >> if federal participation is limited in these fashions, it is the only way that would respond to mr. barton's concerns about deficit reduction, if federal

participation is limited in that fashion, then the states will have a choice either of reducing the number of people that they serve, cutting back on rationing the services to those people, or raising state and local taxes. >> mr. chairman, thank you. i'd like to ask unanimous consent to enter into the record if anyone is interested in learning more about medicaid march of dimes and a number of experts are having a lunch provided forum tomorrow or excuse me thursday, february 2nd, 12:30 to 1:30 here in rayburn in the sam johnson room, rayburn 2020, to learn why medicaid matters to kids and i encourage you all to attend. >> could you send a copy over to me. thank you. >> here it comes. >> i recognize dr. burgess for five minutes. >> thank you, mr. chairman. i want to thank our panelists for being here today, very interesting discussion, very timely discussion. miss yocom, let me ask you, chairman murphy was, i think, directing some of his questions

about improper eligibility to terminations and one of the things that has concerned me for some time is the issue of third party liability, medicaid patient who has actually other insurance but also has medicaid. and my understanding is what happens is sometimes it is hard to collect from the party of the first part, the commercial insurer, medicaid is more straightforward, so you end up in a situation where the person who should be responsible for the bill, the insurance company who has been -- who has been contracted to provide care for that patient, actually is let out of the -- let out of the equation, because it just becomes easier to chase the dollars in the medicaid system. is that a real phenomenon? >> it is. we did some work, i believe, in part for your office that took a look at third party liability on

some of the issues that the medicaid program encountered. some of it is about information systems, and just being aware of the coverage. but then even within that, it is about the interaction between the state medicaid programs and the insurance companies and being able to assert the fact they should be paid first. >> so to what extent are the states able to address the underpayments by commercial insurers, overpayments by medicaid? >> yeah, we did make some recommendations to cms to provide additional support and data on these issues. i would need to check to see whether or not they had been implemented and a little more about the specifics. >> i'm given to understand that this is not a trivial problem, there are significant number of dollars involved. is that correct? >> yes. yes. >> and i think it is safe to say

it does vary from state to state, some states do better than others. so you -- if i recall correctly, back in the mid-2000s, 2005, 2006, 2007, you created a list of states where the percentages of dollars left behind were attributed to each state. there were some significant differences. i think texas was middle of the pack. some other states did very poorly. is that -- do i recall that correctly? >> i believe that's right. and i think some of it is the more health plans involved, i think the harder it becomes. some of the states that had a smaller group of insurers to work with i think were able to establish better relationships. >> just gets to the point, that was a gao report of over ten years ago. is this problem fixable? is it worth fixing? >> i think there have been some fixes done. but i am not sure i remember

well enough to tell you much more than that right now. >> i would just let -- there is some very insightful legislation coming on this subject. and i hope people will join me on that. miss maxwell, let me ask you, just staying on the third party liability issue, you've discussed medicaid overpayments in regard to providers not reconciling credit balances with the states. is that correct? >> that's correct. >> so stand to reason since states are not active in tracking down certain party liability claims, they're aware of beneficiaries with overlapping coverage that might receive services that are unintentionally paid for, both by third parties and the state medicaid plan, is that a reasonable assumption? >> correct. >> is it possible for states to take advantage of in-house data like this to approach practices that might not have reconciled their credit balances? >> yeah, that's our recommendation focuses on the, the ability of states to identify those overpayments and

then recover them. we're looking at the report we looked at was $25 million in which credit balances were not reconciled. states had not been able to -- >> say that number again. >> 25 million. for i believe it was eight states, i believe. >> not an inconsequential number, it is a number worthy of our attention, even though we deal with big numbers up here, mr. barton talked about trillions of dollars -- bedazzled everybody with that. but even going -- even focusing on these amounts is important, is it not? >> absolutely. from the office of the general's perspective, every dollar counts, every dollar that is overpaid or goes to a fraudulent provider means there is a dollar less to provide services. >> i want to point out to ten days ago or so, day before inauguration, we had round tables with the governors up here both on the senate side and the house side and it was one of the most impactful days i have seen up here. there is so much energy and enthusiasm on the part of the

governors who want reforms in their system. they want this to be right. they want to deliver the care to their citizens. there is not unanimity of opinion when it is block grant or beneficiary allotment, a lot of discussion around the moving parts. i was very encouraged at the level of involvement of our governors in this issue. thank you, i'll yield back. >> thank you, i now recognize the gentleman from new york, mr. tonka. >> thank you, mr. chairman. welcome to our panelists. mr. archambault, i know that in your testimony you addressed the waiting list and the corresponding decline of services or inability of services. i know that our ranking representative pallone asked you a bit about this or the panel about it. and i just want to dig a little deeper into a claim that you did make where you insinuate that expanding medicaid will lead to the 600,000 individuals on medicaid waiting lists being less likely to receive services. first of all, can you explain

what you mean by medicaid waiting list? i assume you're referring to the waiting list that some states maintain to receive home and community-based waiver services. is that correct? >> correct. >> so i would ask, do you know which states has the longest waiting list for home and community-based services? >> it is usually related to population, you're going to have more people who are usually eligible for the program. but that's not -- there is not a straight correlation that way. >> well, my information tells me that texas is the list that has the longest waiting list. at 163,000 plus people in 2014. and do you know how texas' waiting list, of that 163,000 has been affected by the expansion of medicaid? >> the data usually is a year or two delayed, so it is hard to

draw direct correlation. i would just point out that if we want to make sure that we're fulfilling the promises to the most vulnerable, i think getting lost in this discussion is that medicaid is crowding out state spending of all kinds, whether it is education, whether it is public safety or infrastructure or the waiting list. i don't want us to -- >> i would suggest it depends what states are doing with their medicaid program. texas has not expanded its medicaid. so i -- that was the answer i would share with you. it is very interesting now that we look at some of the data, mr. archambault, do you know which state has the second longest waiting list for home and community-based services? >> again, it depends on the population. by category, and there is no correlation between expansion or not. the concern is even states that have expanded also have waiting lists. so for me, it is about priorities. and for state lawmakers, they're

being put in a very tough position where they're not able to help families like schuyler's and that's deeply concerning to me. >> well, florida is the second in that list of medicaid numbers, and they have not expanded with their medicaid issue. and, you know, i think we can sense a pattern here, so, you know, we need to cut to the chase, fully 61% of those individuals on waiting lists for home and community-based services live in the 19 states that have not expanded medicaid. my home state of new york, one of the most populous in the country, and one which has enthusiastically expanded medicaid maintains a waiting list of zero individuals for acbs waiver services and a track record that has begun to be very favorable about per capita costs for medicaid. it is difficult for me to see the real world correlation that is addressed in testimony like yours where expanding medicaid and waiting lists for home --

where there is a contrast or choice that has to be made between expanding medicaid or waiting lists that grow for home and community-based services. do you have any actual evidence at all that speaks to that expansion and any correlation with acbs? >> again, the point is that when you talk to governors and state policymakers, they are being put in a position where in arkansas they have been trying for years to address issues like families like schuyler -- now they're having to -- >> just yes or no. is there any correlation that you can cite, and i'll remind you, you're under oath, is there any correlation you can cite? >> what i will say is -- >> yes or no, sir? >> there is no correlation -- it is not a yes or no question. >> then -- >> there is no correlation on xan expansion or not --

>> what we're seeing from the witnesses today is a parade of alternative facts designed to obscure the simple truth. medicaid expansion is working. it has provided health insurance to over 12 million people, and my colleagues on the other side of the aisle are engaged in a cynical attempt, i believe, to pick good versus good in an attempt to gut this program and rip health care away from millions of americans. i find it unacceptable. i find it shameful. and i don't think we should sit quietly while people's right to health care is being threatened. with that, i just yield back the balance of my time. >> thank you. i now recognize miss brooks for five minutes. >> thank you, mr. chairman. i don't think that trying to explore waiting list questions and waiting list issues is an attempt to gut medicaid. in my view, it is an attempt to strengthen the services and the ability to provide people with developmental disabilities,

traumatic brain injuries, mental illnesses and ensure those people on the significant wait lists receive care. and i'd like to go back to you, mr. archambault, with respect to -- i do think it is more complex than a simple yes or no, is there a correlation, is there not a correlation. so could you please go into greater detail with respect to what your foundation, what you all have found, with respect to the waiting lists, with respect to the people who are on the waiting list, with respect to what the states want to do with the waiting list. going to let you use most of my time. >> sure, thank you, congresswoman. i would just say that to focus on a waiting list is a vacuum. some states have -- >> what do you mean -- >> some states have deliver care -- the phrase i'm sure you're all very familiar with, you've seen one state medicaid program, you've seen one. some states have decided to take their -- the people that would qualify for a waiting list and include it into an 1115 waiver

request and deliver services in a different way. my point is that the principles by which we have -- as a country, for our safety net, is that we make sure that a safety net program accomplishes a few things, one, is it targeted and tailored to the truly needy. are we living up to the promises we're making to these families and individuals before we make new promises? >> and is it fair to say those currently on waiting lists in the states are the truly needy? is there any dispute about that? >> i think there would not be. and i would be happy to explore it, but i'm not sure how intellectually disabilities or mental illness is ones we could be -- >> people who cannot take care of themselves, is that correct? >> in schuyler's example. >> people who are often not working, is that correct? people who truly are incapable of make -- of taking care of them physically or mentally themselves. >> correct, and this was the traditional medicaid population

preaca was the age, the disabled, pregnant children, and pregnant women and children, excuse me, that we were trying to fulfill that promise to. the aca changed that discussion. >> and how did the aca change that discussion? >> well, expanded to a population that is the vast majority 82% childless, able bodied adults. so, again, these are individuals that don't qualify for tannive, don't qualify for long-term food stamps, they have not traditionally been a population. and what is important for us to remember here is our goal is not to get people to stay on medicaid. we want to make sure they have better health outcomes and i think most of us would agree ideally it is if they're able to work, out in the workforce supporting themselves and on private insurance. that's ultimately, i think, where we want to be as a country and that's the discussion we need to be having. >> is it fair to say most of the people who are on the waiting list who are the developmentally disabled traumatic brain injured people and those with serious mental illness are always going

to be on medicaid? >> correct. >> it is a different type of population and what has been your discussion and findings with the governors with respect to how most of them would like to take care of this population, if there are -- if there are consensus among governors, what is the governors and the legislatu legislature's view with respect to this population. >> i think there is ongoing concern by governors they're not able to be able to support these. i will say there are exceptions to that rule. and if you look at the state of kansas, the state of maine, those governors have been able to buy down their wait lists. maine from 1700 individuals, down to 200 individuals. >> how did they do it? >> well, they got some budget sanity, they did not expand medicaid and so they have been able to focus on eligibility as we have talked about today, to make sure that their programs are true ly focused on those that are the most needy, the age, the blind, the disabled and made that a priority in their state and they have had success

in buying down their wait list. >> i think we need to continue to explore the states that have found ways to have little to no wait list. i certainly hope today our governor, governor hochom, it is an outstanding program, but i hope folks on both sides of the aisle, it is a way to save and to help those who truly need it. it can be replicated. i believe it is an incredible model that can work. unfortunately we still have a waiting list. in indiana. we don't want a waiting list, but i hope that with the new nominee to lead cms we can make all of medicaid a far stronger and better program with the controls in place as a former u.s. attorney i worked with the units, we need to do more to support them, we need to do more to support all the efforts to make sure our truly vulnerable are protected.

with that, i yield back. >> okay. recognize miss clark for five minutes. >> thank you, mr. chairman. and i thank our ranking member. before i get into my actual question, actually want to respond to mr. howard because as a proud new yorker, i must correct the impression left by your characterization of the empire state. are you aware that the new york state's medicaid redesign team has been a national leader in controlling costs and improving quality for medicare members? the empire center for public policy, described as a conservative think tank and government watchdog released an analysis in september of 2016 that new york medicaid spending, per recipient, dropped from $10,684 to $8,731 or 18% between

2010 and 2014. at nearly twice the national average. according to the independent new york state controllers office, the mrt restrained total medicaid spending growth to 1.7% annually during the period of fiscal year 2010 to 2013. this marks a significant reduction over the trend for the previous ten years of 5.3%. during the same three year period, medicaid reenrollment grew by more than half a million people. billions of dollars have been saved, and per recipient, spending has been slashed. and fiscal year 1415 alone, a total of $16.4 billion was saved, thanks to the mrt initiative. this track record of success led the controllers office to declare the mrt represents the most comprehensive restructuring of new york's medicaid system since the program began in 1966.

and we have no waiting list. i'd like to now turn to mr. westmoreland. in mr. archambault's written testimony, he cited numerous concerns about medicaid expansion. however, he ignores the fact that this program has also had a positive impact on the quality of life and health for millions of americans. he also ignores the fact that many of the positive impacts such as cost savings from preventative medical exams and early detection and treatment of disease will result in future cost savings to the states and the federal government. i am a strong supporter of medicaid expansion because i see the significant value of the program. i'm interested in improving the program and not destroying it. so mr. westmoreland, mr. archambault claims that the medicaid expansion funding threatens the viewly eventu ltr.

can you clarify why this is not the case? >> i begin with first challenging the discussion as i did in my testimony of who is truly vulnerable. i want to be clear that not all people with disabilities, cognitive, traumatic brain injury, any of those discussions ongoing, were traditionally eligible for medicaid. it was tied to a 75% poverty and receipt of ssi, and many people whom we would all consider to be disabled have never been eligible for the federal medicaid program until the enactment of the aca. so let's start with those people. secondly, i would point out that there have been significant studies, economic, and macro economic studies, some by business schools, some by economists, showing the states actually have significant budget savings and revenue gains by having the medicaid expansion in their state. so i think that it is clear that states benefit on financial basis, and that their citizens benefit on their financial basis

in the ways that i outlined in my testimony. >> mr. westmoreland, both mr. archambault and mr. howard claim that medicaid expansion poses an unsustainable burden on state budgets. can you clarify why this is not the case? why have most states that have expanded medicaid actually experienced net budgetary savings associate sd with the expansion. >> yes, let's start with the health care expenses that as we discussed earlier there are fewer uncompensated care costs within the state. in addition to that, there is an influx of federal funds and those federal funds have a reverberating multiplier effect in the state economy. finally, states are able to provide as you suggested preventive and early intervention services that might not have been available to uninsured adults before and actually lower the ongoing health care costs for those people. >> my understanding that numerous studies have disproven the myth that medicaid

expansion -- is that correct? >> yes, ma'am. >> i yield back the balance of my time, mr. chairman. >> thank you. now i recognize new member to our subcommittee, gentleman from michigan, and reverend, mr. tim walberg. welcome aboard to our committee. >> thank you, mr. chairman. mr. archambault, i appreciate the safety net illustration that we want to have safety nets. we don't want to have safety nets forever for people. i remember i never worked over a safety net, but i remember working at the u.s. steel south works and third helper going out and being responsible to swing a sledge and take the plug out of heat of molten steel. and had a fault protection strap on me. i appreciated that. but when the shift ended, i didn't want that strap, i wanted to move on. that's a laudable goal, we find ways to make sure that people who truly need that safety net

have it. we make sure that we don't waste it on others who don't. and encourage them to move on in a very positive way. i would like to ask you for further response from your testimony and also miss maxwell, i would like for you to comment after mr. archambault, your testimony references some of the waste and fraud issues that face our medicaid programs. individuals that have passed away, decades ago, individuals using high risk or stolen social security numbers and tens of thousands who had moved out of state yet remained on medicaid. what can we do to combat some of these problems more effectively. >> so there is a number of things that we would recommend and, thank you, mr. congressman, for the question. the first one is allow states to check eligibility more frequently. under the aca there was a change that states could only redetermine eligibility once a year. and unless they were given a reason to recheck eligibility.

we have found that states that are able behind the scenes to access data internally within state government but also through third party vendors, if they're able to run those on a quarterly or monthly basis, they're finding that these people -- individuals have life changes, just like all of us. and so whether they move or they die or whether they get a significant raise, we need to make sure that we find that sooner rather than later, otherwise we're wasting money and i believe that there is vice partisan agreement on that, we need to make sure. the other thing is we need to make sure that the federal databases which we haven't talked a lot about, the quality of the data in those is quite poor. if you talk to state leaders, they will complain constantly about how late the data is, out of date, and it is not flexible enough. so making sure that states are able to look for dual enrollment, for example, in the food stamp program is moving in this direction, we should be doing it for medicaid, just to make sure we're not wasting

money as a result of individuals moving across state lines. >> okay. thank you. miss maxwell, could you add to that? >> i would love to. i would echo what we just heard about the crucial need for better medicaid data. it hampers the ability to understand the program issues. but it is significantly deterred by us trying to find fraud, waste and abuse. in addition to that impact and protection, we also need to think about protecting the program from fraud happening in first place. in addition to the data, would encourage us to continue to work with states to improve enhanced provider screening, to make sure that providers that get in are the providers we want to get in and want to pay. >> okay. thank you. mr. archambault, an audit in arkansas revealed more than 43,000 individuals on medicaid who did not live in the state. with nearly 7,000 having no record of ever living there. more than 20,000 medicaid

enrollees were linked to high risk identities, including individuals using stolen identities, fake social security numbers, et cetera. something of interest to me, michigan, has recently identified more than 7,000 lottery winners, receiving some kind of public assistance. including individuals winning up to $4 million. those jackpots are something that encourage them not to be on medicaid assistance. mr. archambault, do these individuals get approved for and state enrolled in the medicaid program and is it the federal government or the states dropping the ball? >> well, congressman, maybe a little bit of both to answer that question. and i think what is really important here is that there are some policy changes that have happened. the affordable care act removed an asset test for the medicaid program by and large. there is some that it still

applies to. but as a result, these sorts of outlier cases admittedly but when an individual wins $4 million takes a lump sum payment, they may not qualify that month, but the very next month they would qualify for the program and can remain on. let alone we're not checking for 12 months in most cases, so we wouldn't know. so the point i'm making here is that we need to make sure that we have gaping holes that exist. we have data in many cases within a state government, we have data across state lines and the federal government needs to insent states to say, if you're doing this on a more regular basis and identifying fraud, you can take a little bit of that savings to pay for those efforts. this points to mr. howard's point that that is not the incentive inherent in the current financing structure we have set up. >> thank you. my time has expired. >> i recognize dr. deweese for five minutes.

>> thank you, mr. chairman. as many of you know, i grew up the senate farm workers in the medically underserved community of coachella. i've seen what it means when a community is medically underserved and they cannot access care. i can tell you this, if it was not for medicaid, the coachella valley and regions like mine across the country would not have access to health care that every one of us up on this dious and our families enjoy. if we repeal medicaid expansion, people will lose health care coverage. they will stop seeing their doctors because the costs will be too high and they will stop taking their life saving prescriptions because they're too expensive. in california alone, the nearly 3.5 million individuals who enrolled in medicaid under the aca expansion provision could lose their coverage. that's millions of families losing access to health care. and if we repeal medicaid expansion, uncompensated costs will increase, straining our nation's health care systems which will drive up costs for

everyone because you see, when people don't have health insurance, they don't stop getting sick and our emergency departments do not turn someone away because they don't have insurance. emergency physicians treat the patients, like they should. so the hospitals have to make up the costs and in 2014 alone, health systems in california saw a decrease by 45% in 2014. all hospitals in my district in particular has seen a drop in uninsured patients in the emergency department by half. so we need to expand medicare even more, make it more efficient, and more desirable for providers to see more medicaid insured patients. listen, fraud is bad. and political amplification of the problem to wrongfully justify cutting health insurance for sick patients is bad. so here's the possible common

ground, here is what i think we can both agree on. if we start with the premise that we want to cover more uninsured, economically struggling families like the middle class, and more vulnerable families, then we're on the same page. but if you start with the ideological goal to cut or end medica medicaid, you'll breed mistrust and millions of people will be harmed including the middle class. so the real question, and the real question, mr. howard, is are sick and injured people getting the care they need because anything short of this is negligence. so let's tackle fraud so that we can expand coverage to more struggling uninsured middle class families. the question i have, if you were to choose one thing that you can do to combat fraud, if there is one action that you can take that we can make the biggest difference in the system, what

would that be? >> i think it is around the providers. making sure that we have eligible providers who are in good standing, and that those who are not in good standing and should not be providing services aren't going across states to provide services. >> thank you, miss maxwell, the one thing, the one thing that will make the biggest difference. >> i would absolutely have to go back to the data. without that transparency, we can not see what is happening in the program and we have a lack of data across the nation, and also coming in from the managed care companies. >> mr. howard, the one thing you had one thing you can change, to make the biggest difference in fraud, what would it be? >> in fraud in particular, engaged data transparency as my colleague on the die ous was saying, it should be enclave to make benchmark provider performance and engagement. >> thank you. mr. westmoreland what does the evidence suggest about how medicaid expansion is making health care more affordable.

is there evidence that medicaid expansion is reducing patients need to forgo medical care due to costs? >> medicaid expansion is highly associated with the decline in personal bankruptcies, it is also associated with greater financial security for families who are newly eligible. >> so these are middle class families who are having some economic security because of the medicaid expansion. what is the body of evidence say about how medicaid expansion has affected patients access to primary care and preventative care? >> people in those beneficiaries who are newly ensured under the medicaid expansion have much higher rates of traditional sources of care, seeing primary care and using preventive health services. >> thank you very much. my closing statement is, you know, if this is leading to increase in expansion for economically struggling middle class families, then, you know, i'm in. but if the ultimate goal is to

create a facade and amplify a problem politically to then justify policies that will hurt the middle class and that would decrease health insurance, then i'm not in. so let's tackle fraud so we can expand more health coverage to middle class families. thank you. >> thank you. now we're recognizing another new member of our committee from, i think, ucla, former state assembly woman, state senator, mayor, congresswoman mimi walters of california. you're recognized for five minutes. >> thank you, mr. chairman. my questions will be directed to mr. archambault. first, the supporters argued that medicaid expansion would increase jobs. has this happened? >> there has been a number of studies where the consultant predictions -- have been very off, whether enrollment or jobs. and in particular iowa, tennessee, where there were predictions of gains in hospital jobs and health care jobs as it related to expansion and that's

the opposite is actually taken place there has been a loss in health care jobs. >> okay. and during the conception of the aca, supporters argued that medicaid expansion would stop hospital closures. has this been the case? >> so, certainly has not stopped hospital closures. in a number of states hospitals have still closed. and i think it is important to realize that the supporters claims it is a silver bullet to stop closures has not been true. so there is -- arizona, massachusetts, a number of these states where -- that have expanded in hospitals have still closed. >> okay, and finally, medicaid expansion was projected to lower emergency room use. however, you pointed out that the evidence suggests that emergency room use has increased after expansion. and that many emergency room visits by medicaid beneficiaries were deemed to be avoidable. can you explain what might have led to this outcome? >> sure. and my experience is not just

influenced by the aca. i live in massachusetts and worked on romney care and have studied romney care very closely. and one of the things that becomes apparent is both in the expansion population and the traditional medicaid population is folks are not getting coordinated care because they're showing up to the ers at a much higher rate than those that are privately ensured or insured. so as a result, these are the questions that we need to ask about, the effectiveness of the program, the quality of care that individuals are getting and there has been a number of surveys looking at how many of these visits are avoidable and unfortunately in massachusetts, those surveys found that 55% of medicaid visits to the er were unavoidable. >> okay. thank you. i believe my time has expired. >> mr. peters here? i recognize miss schakowsky for five minutes. >> thank you. thank you, mr. chairman.

the affordable care act has just been a blessing for so many people in our country. 12 million more americans have access to health care. mr. westmoreland, governors across the country submitted letters in response to representative mccarthy's request to describe the impact of the aca and the expansion of medicaid within their states. i'm assuming that you've seen some of these letters? >> yes, ma'am. >> okay. even some republican governors appear to have positive things to say about the expansion of medicaid in their state. for example, the letter from my home state of illinois, stated that our -- the governors say our medicaid population, quote, now stands at 3.2 million, almost one quarter of the state's population and went on to urge republican leaders in congress to, quote, carefully consider the ramifications of proposed changes, similarly

governor sandoval of nevada stated in his letter to mr. mccarthy that, quote, i chose to expand medicaid -- the medicaid program to require managed care from most enrollees and to implement a state-based health insurance exchange. these decisions made health kerouac cecar care accessible to many nevadaens who never had coverage options before. can you briefly touch upon how the residents of states that expanded medicaid under the aca have benefited, such as illinois and nevada? >> i'm sorry, i didn't understand the last part of the question. >> i cited illinois and nevada, but can you briefly touch on how the residents of states that did expand medicaid under the aca have benefitted? >> let's begin with 11 million people have medicaid coverage who didn't have it before. and many of those people are in serious need. i would point out and agree with

you that of the -- the governors who wrote to mr. mccarthy, none of them requested repeal. i believe. and past 16 of the states republican governors and ohio, mr. kasich, one of your former colleagues, i think was most passionate in describing not only how it has benefited the residents of ohio to have services, but that indeed he believed it was a moral duty to continue to cover these people under medicaid. >> thank you for that. and can you briefly touch on how -- let's see, i also wanted to mention there are other examples, states, as you said that have had positive outcomes for their residents, and beyond providing health care benefits to an additional 12 million people, how has medicaid expansion helped states manage their budgets? has it had a positive impact? >> as i suggested earlier, there have been business school

studies and economic studies suggesting that states who have expanded medicaid have had not only a net increase in federal funds coming into the state, but they also enjoyed some revenue increases because of the reverberating effects providing those funds in hospitals. i would also point out to you there is a long term study to be done of how productivity might be improved by people having health care services who previously were denied those services. >> thank you. some of the letters i was referring to seemed to raise concern by republican governors that changes to the medicaid program would produce destabilizing cost shifts to the states. for example, governor baker of massachusetts and his letter to mr. mccarthy said, quote, medicaid is a shared federal state partnership proposal that suggests that states may be provided with more flexibility and control must not result in

substantial and destabilizing cost shifts to states. so is there a value concern under the proposals you're seeing such as proposals to block grant medicaids, should states be concerned about major cost shifts? >> states should be very concerned. the first question is what level will the initial block grant and its formula be set at. the major question for states to focus on is how the evolution, the increase of funding over the -- in the future, will evolve as compared with the actual cost of providing health care services and the number of people who need them. as i suggested earlier, states will be left holding the bag for both medicare inflation and the number of people who have no health insurance. >> and what about for those receiving health care through aca's medicaid expansion are they at risk particularly if they block grant the medicaid program? >> first, i suggest that my colleagues on this panel would point out that those suggest

that those people should be the first to go off of the health care rolls and would return to traditional medicaid populations as they have existed over the last 20 or 30 years. i would suggest the people who are on medicaid expansion are the people most likely to be on the chopping block to begin with. but secondly, i would say that as every state, expansion or no expansion, experiences the growth in health care costs that is almost inevitable looking at cbo or any other projections, if the states are left holding the bag and they do not have a guarantee of federal funds, they're going to be cutting back on everyone. >> thank you, i yield back. >> thank you. another new member of our committee, mr. costello, of pennsylvania, appreciate you being here. you're recognized for five minutes. >> if i could ask a couple of questions on hhs oig. has the number of criminal investigators increased or decreased over the years? >> the number of criminal investigators specifically? >> yes. >> i think right now we're below

our ft ceiling. we're still trying to hire more. >> how many more do you think you need to hire? >> well, we're -- we would hire as many as you let us, but we -- we need dw-- we're at 1700 is where we're pegged for, the entire oig. >> true or false, for every $1 expended, $7.70 is returned to the health care fraud and abuse control program. >> that is true. >> is that a consistent return? >> as far as i know, been around 7 and same thing for the medicare fraud units, they have the similar ori. >> you've conducted a review of state medicaid agencies presented with allegations of provider fraud. did you find that state agencies properly suspended medicaid payments to those providers? >> they did not make full use of those tools. >> to say they did not suspend all -- >> they did not. though in a number of the cases where they did not suspend, they

cleared the provider of wrongdoing. >> very good. since your work on the issue of program integrity, since your work has found cms' oversight of states claiming of matching dollars is inadequate to safeguard federal dollars, what more could cms be doing to ensure the integrity of medicaid matching? >> there are a number of things along the program integrity principles that we believe cms could do in conjunction with the states give than cms and states share fiscal risk, we believe they should share accountability. so as i mentioned, prevention, helping states implement the enhanced provider screening, helping them drive down improper payment rates and then, of course, the data to be able to understand the program and to tech fraud and more importantly the data helps us hone in on fraud, waste and abuse and target our oversight so we can get this tricky balance right between trying to have really strong program integrity, but

also not put undue burden on providers. >> i'm going to shift this question to mr. archambault, but after he answers, anyone else feel free to respond including what you just mentioned about the issue of specifically enhanced data matching technology. it seems to me that if you have technology and you have data, when we're talking about the aca change which only requires states to perform one check per year, knowing that we have the data, knowing that we're pretty technologically advanced society, it would be, i think, a little bit easier to go about detecting ineligibility or fraud or anything of the sort to cut down on those who are ineligible from being accepted into the medicaid program. mr. archambault, i see in your written testimony in the first ten months of operation pennsylvania's award winning enterprise program integrity initiative identified more than 160,000 ineligible individuals

receiving benefits including individuals who were in prison. and even millionaire lottery winners resulting in nearly 300 million in taxpayer savings. what can we do in order to pivot to real time identification of something that doesn't seem quite right rather than just relying on that one moment in time annually to beef up program integrity here. >> so i think there is a number of things that the federal government can do to enable states to do this. the first one is if they're investing state dollars in some of the efforts, that if they're able to find cases that are eligible for them to keep a piece of that savings up front and more than they get to save now, given the funding formula that we have. the other one is let them check more frequently. and then the third one is to make sure that the actual data that the federal government is allowing access to is timely or

allows states to go somewhere else to get it from a private vendor if the federal government's data is not timely enough. >> yeah, i would agree that the coordination and sharing of data is critical between the federal and state gaovernments. when providers are enrolled, they're asked who the owners are. we know who we're doing business with. in one case, we found that the state medicaid agency thought there were 63 owners, medicare thought 14 owners and they told us it was 12. trying to coordinate the data to all the program know who we're doing business with, in addition, we recommend that the medicare data be improved, so that medicaid can share that and reduce the provider burden -- to enroll in different programs. >> that gets to the point about the duplicate eligibility issue, correct? >> yes, it does. while we are a technologically advanced society, the medicaid program truly is not.

states data systems are pretty antiquated and there is a lot of work to do to get good data systems that are more flexible, more agile. >> if i could, sir, i would also say that the recently published managed care organization rule provides for substantial improvement in data systems and i would ask this, and this committee actually accelerated the effective date of that with the 21st century cures act. i would ask you to keep the mco rule in mind as you move forward with the question of whether regulations will be withdrawn in the early part of this -- in the early part of this administration. i think it is valuable addition to try to be able to find -- i agree with all my colleagues, the data systems need to be improved and i think the mco rule does that. >> thank you for your comments. >> thank you. and now recognize another new member of our committee, the owner of carter pharmacy, a place we might see someone like elie walker and opie serving

drinks -- >> very much. >> small town medicare. good to have you on board. mr. carter. >> thank you, mr. chairman. thank you for being here. we appreciate your participation. i want to preface my questions by apologizing if i ask you something you weren't prepared for. and if you don't know the answer, if you'll simply tell me, you know, that you can get me the answer, that will be fine. miss maxwell, i understand looking at your bio last night you have some expertise on the 340 b program. >> i do. >> i don't want to get into that program, however i want to explain to you a situation that exists in my district. i have a hospital in my district that was participating and receiving monies from the 340 b program and because didn't meet the threshold, they -- they were put out of that program. they got back in it. as i understand there are two different levels that you can be at as a sole community provider, and also as a