Were going to talk about medicare and medicaid funding with a couple of the key players and moderated by our own Health Editor rebecca adams. Joining her will be michael burgess. Also we have andrew slavitt. Thank you very much. Thank you. You have put together there were some questions about the implementation and i understand you were on the phone with mr. Slavitt quite a bit as was dr. Price. I just wanted note that you all have worked together in that way before. It was my job to provide context. Yes. Everyone is eager to see what happens with the health care law. Me too. Were here looking at the landscape and potentially anticipating a house floor vote next week. Do you think that is still on track to happen . I do. I get to do it all again in the rules committee next week. Anticipating that goes is this not working . Is this working . As i was waiting out 27 and a half market up in the energy and Commerce Committee last week, makes good television. Me being fortunate to be on the rules committee i get to do it all again next week. Thats assuming it comes out of budget committee. Well mark it up in the rules committee. I dont know if there will be changing or not. I do expect to see it on the floor shortly there after. Last night it was a web count and it was clear you dont have the votes to pass it through the house. How do you potentially, how might you attract conservative votes without risking losing more moderates . Theres a couple of moderates who expressed concern and said they cant vote for it . Thats why im not on the wic take. Its a difficult balance. Thats what makes the house of representatives so important in our constitutional government. We are the key that gets it through the door. You dont get to do anything else. I have been looking for this opportunity since then. Its not an opportunity that i want to see us walk away from. There are people on the left and people on the right. Its difficult to bring those sides together. Thats the job of leadership. Thats what they signed up to do. You can see it in our Committee Markup last week. There were people less comfortable with some of the ideas. I get that. At the end of the day i want a product we can all support. This is different from some other things. Reconciliation also played a part in the passage of the Affordable Care act but there were 60 Democratic Senators on Christmas Eve of 2009 who voted in favor of advancing the bill and cutting off debate and voting if favor of the bill on the senate floor and sending it over to the house. That 60 number was lost shortly thereafter and thats why the original projections was the Affordable Care act as passed through the senate could not pass in the house but eventually it did pass in the house. That brought us to where we are today. This time perhaps approaching it with a different approach, reconciliation was sort of the batting clean up on the Affordable Care act when it passed in 2010. Reconciliation rather than being the last act is first act because of the senate rules that things can pass with 51 senators on a budget reconciliation vote. We dont have 60 senators to work with on the republican side. I want to talk about the senate. Just thinking a bit more about the house. The republicans study yesterday printed out a little brochure of their demands. These are ideas. There are several things involving taxes and medicaid. How likely it those might be incorporated as we go forward, do you think . Those are ideas that are being discussed. The Vice President was there. He said he and the president welcomed ideas. I cast my vote in the full committee after 27 and a half markup. Thats the product i would like to see come to the rules committee. Thats product i would like to see come to the floor. It was a tough vote to take. I recognize that. Thats why i would like to see that be the product that we advance. Ultimately, i want to be successful. Am i willing to discuss other aspects, you bet. I welcome the fact that the president , Vice President are so interested in this. Its a refreshing change from a landscape that ive lived in for the last seven years. This is a good place to be. So, the conservatives came out of that meeting. You mentioned the Vice President and they came out of that meeting feeling as if the Vice President was telling them in a subtle way they would get some of these demands. They were optimistic that they would get them. Let me just clarify, youre opposed to any changes because you think it would make it difficult to get it through the house . It could. Ultimately i want success. That makes sense. Okay. I have a couple of questions. The Congressional Office came out with a couple of things on the bill. One of the things that was striking to me is from the political standpoint, many of the people who would be affected by higher premiums turned out to be trump voters. People who are older, who happen to live in high cost areas, particularly rural areas. Was that your intent when wri s writing the bill . As far as the Broad Perspective of the Congressional Office, the way things are scored in health care has been a concern of mine for some time. The fact that were constrained to a tenyear budget window so everything is always on cost, never on savings. Yes there was up front costs. The savings occur now these next ten years and the Congressional Budget Office does not have the flexibility to do that. I do note that the Congressional Budget Office is its least accurate when it tries to predict human behavior. They may do well with economic modelling and plugging numbers into formulas but going back to part d, remember they said it would be 100 participation and the score was dust and that turned out to not be accurate. On the Affordable Care act they said the number of sign ups would be much larger than what it ended up being. When it comes to predicting human behavior, again, i think people need to be cautious about overinterpreting those numbers from the Congressional Budget Office. I think mr. Slavitt wants to get in. Its an honor to be up here with chairman who is someone, we dont see eye to eye on everything. Hes got a passion for health care and a genuine interest and i think the same things that i do. I think let me address the Congressional Budget Office question for a second. I think its, my kids dont like when the teacher doesnt like their paper and give them a bad grade. Theyve got all kinds of reasons to question the grade. I think we got to keep in mind a couple of things about this. People want to go about the Congressional Budget Office and their work on the aca. What didnt they predict . They didnt predict a Supreme Court case that stopped cases from having to provide medicaid. They didnt predict that congress would defund the rate stabilitization by about 10 billion dollar which also reduced rates. They dont have a crystal ball for the future. Directionally, the policies and the bill reduce tax credits for people that are already having a difficult time affording insurance. It shouldnt be a surprise whether the number is exactly right or off by a third. Theres going to be people that will lose coverage in this bill. I think thats very hard to argue with, at least the way the bill comes out right now, from my perspective. One other question i had is as you think about the demographics of the people affected, they talk about how different people are affected. A 64yearold who is making 26,5 26,500 would see a big pre increase under the cdos projections. Whether they are exactly right or not, we can leave that up from debate. Going from a 1700 premium to 14,000 premium, was that would you have written the bill a little differently if you had known somebody making 26,500 would be facing those kinds of costs . Right. I was less involved in stuff that youre talking about because thats on the ways and means side. I would also say this because we mentioned the Vice President yesterday and the president yesterday in his remarks in tennessee. There is a willingness to talk up things in terms of helping people. Thats one of things the president has stressed throughout this entire argument. He doesnt want to help people. To the extent there can be improvements or modifications, not so much that they conform to an ideology but they help people. I think the president is likely to look favorably upon that. Sounds like the ideas that senator john thune is putting forward, some of the ideas that senators are kicking around trying to help working class people, sounds like that would dont forget that we do need to bear in mind when the Affordable Care act passed that was it, last word, cant do anything else. When this bill passes, it is the first step of a multistep process. Yes, indeed this is the key that gets us through the door so we can talk about other aspects of reforming the health care system. There will be administrative things that will happen, perhaps are happening this week. The administrative actions that can be taken by a secretary of health and Human Services who historically has been in the business of providing care and helping people, not denying care and pushing people away. Thats a positive. Then there are the other things that we will do through the regular order. The things that will require getting 8 or 9 Democratic Senators to vote in favor of them. There are other opportunities. This is not boom, this bill passes. Its the first step in a multistep process. I want to talk about administrative actions and ask a question of you about that. Just to follow up, one other thing that was in the cbo report that i found surprising is by 2026 they are predicting that seven Million People would lose their job related insurance, their insurance through their work. Again, is that something that you all had thought about when writing the bill . Again youre going back to ways and means land. I think there was recognition that as the tax credit begins more generous, perhaps this is an attractant for someone either providing employer based coverage or participating in employer based coverage, i guess to me the answer there is coverage is still coverage whether its employer based or purchased by the individual. I like the fact that we have a robust employer based coverage provided in this country. I can recall through my tenure people talking about year end and year out about how its eroding and going away. The blows it was dealt during the Affordable Care act and still be as robust, i think that speaks for the employers wanting to provide benefits for employers and i anticipate that would continue in the future. Thank you. On administrative actions which dr. Burgess brought up, mr. Slavitt, if you were still in charge, what would you be doing . Its clear this was a tough year for the marketplaces. Youll hear republicans say onethird of counties only have one insurer and the benchmark silver plan premiums were going up an average of 25 . There were some challenges you would have had to deal with. If youre still in your position as the head of medicare and medicaid in the marketplaces, what would you be considering . Sure. Here is my read. First of all, this is the private market solution. Markets arent perfect. They are irregularities and you have to figure out how to address them. My read on the last few years is the first few years coming out of gate were under priced. I think there were some adjustments. Hhs just released numbers yesterday. 85 of people saw no increase. In fact, it was average of 1 increase. I think a lot of the talk is over blown to the reality. In fact, there are states, maybe a dozen to 15 states in rural areas that have competition problems and for people who dont receive subsidies. Thats a problem. I dont think ever should suggest or has suggested that this law doesnt have challenges or if the next law passes it wont have challenges. You need a cooperative spirit to fix the things you begin. You can talk about why that is and we talked earlier about some of the things that led up to that including the defunding of some of the things in the original law intended to stabilize the law. The fact is where we are now today requires some surgical focus and solutions. What would i do administratively. I think first of all, very good news and the s p just came out with a report that says the rate increases were one time and people are beginning to move back into the market. I think thats very good news. Cbo a fiffirmed that. People filed their 2016 numbers which i look at very, very closely. I used to be in the business. I came into the private sector before it came into the government. First three reports out were very favorable. Blue cross this florida had a 75 mlr. Hcsc that lost the most money has an improvement. One of the ideas that i like is this funding pool for states because i think if states put in place targeted reinsurance pools or spent it in different ways as they saw fit to really bring the subsidy levels up to middle income levels, that would be the best surgical approach to the challenge. A moment of agreement and consensus because the Patient Safety and stabilization fund, used to be the Innovation Fund that at one time i championed at a 25 billion amount, in the bill it was passed through our committee was at 115 billion. Of all of the things that i look forward to what could be different, i spent the month of december talking to my counterparts in state government, state reps and state senators. The message i want to convey to them is i want to be for what youre for. I dont want to come down here and tell you what youve got. I want you to tell me what to fight for. We had the discussion about block grants but this concept of being able for the state being able to participate once again in what used to be called insurance pools or risk pools, restart of Health Affairs about a reinsurance plan and risk pool where individual Insurance Market was on the ropes because of really not even because of Affordable Care act but because of guaranteed decisions made back in the 90s. Using those premiums in a forward leaning way. They were able to take eight diagnostic categories out of the individual market, lower the cost for everyone else. Fund this through premiums and individual assessment on individual policies and lower the cost by 5,000 for younger individuals for premiums for the year. Older individuals by 7,000. I think thats the type of the solution i want my state to look at that. I dont see that as a bad thing. Youre exactly right. When it comes to Insurance Market rules, we can have a debate about the best approaches but i think there are surgical solutions. Its all math. Sgr that thats one of the most minor things. Its a 25 cut of Medicaid Program and a capping of that program forever and in return a significant tax cut for industries and well off individuals. Again, we can have different views about whether thats a good idea or bad idea. My main point is we never had that debate as a country. The most significant thing that happens in this bill and i can say this as someone who is very interested in Medicaid Program is thats a significant change to the way medicaid works. Its a significant change in the financial commitment of the federal government. I dont know that in the in all the time we spent talking about the repeal and replace, thats gotten enough air time. That is something that doctors and hospitals and governors are having a lot of concern about. In the senate does moderate the bill and strip back some of the medicaid provisions, could you get that type of bill through the house. I can deal with what i have to deal with right now which the bill we passed after 27 and a half hours. Thats the bill i would like to see us send over to the senate. What they do with it is up to the greatest deliberative body in the world. Well see what we can do with what they come up with. I do since he brought up the scope a little bit. One of the headlines from yesterday was that confidence in the economy is higher now than it has been since i first started in congress in 2003. There are a lot of things that can be done if you have an economy thats growing between 2 and 4 as opposed to 1 and 2 which is where its been for the last eight years. We got a 20 trillion dollar debt. Were coming up gents tagainst mother of all debt limit battles. If we tackle these problems in medicaid system and deal with them now, maybe we wont see them having to be dealt with budget cutting when the debt limit has to be extended when ever that happens. April, may, june, july but sometimes in the very near future. Thats not something you push off to the next ten years. Thats happening this year. All of these things that are occurring are occurring in, ill just tell you. I dont know that ive seen a time where there is so much activity on so many Different Levels in the United States congress. Obviously, we have this thats ahead of us now. Weve got to fund the last fiscal year because that continuing resolution is about to expire. We do have the aforementioned debt limit. Theres no shortage of big, tough, fiscal financial decisions. Its this year. The can thats been kicked down the road stops here. If health care is acromon acromonious, it seems like it would be able to deal with those. Youre right. I hear that talked about. In some ways i think its good to have the Health Care Debate separate and apart from Everything Else thats going to be happening. It will be so much competition for air time, for intellectual ba bandwidths. Its not bad that were getting this done early in this congress. Circling back to the administrative actions, what would you like to see dr. Price do . Hes already put forward a packet of smaller adjustments to stabilize the market. What other things dealing with, for example, essential Health Benefits might you be interested in. If you asked me this question last week, i would said what secretary price and now cms administrator did on monday in the letter they put out telling states we want you to look into the possibility of where the 1332 waiver can be helpful to you. Another place of agreement. Where my state has been focused on the 1115 waiver, but were passed that now. Let me just explain for anyone watching that these waivers, the 1332 allowed states to take a different approach to Health Reform if they can meet certain guidelines. The 1115 waiver is in the Social Security act. This flexibility that secretary price put forward is exactly what i would like to see. You normally dont use the words exciting and Health Policy together in a sentence. I know as a journalist this is something that would be familiar to you. One of the most exciting days in Health Policy is a day before inauguration day. A lot of governors were in town. There was a roundstable on the is that the finance committee that we were allowed to attend. Then we had a roundtable over in energy and commerce side. They are anxious. They are anxious to be able to do some of the things we have within talking about. Cms has an office in baltimore. Right. Every governor described going to this office in baltimore. They all talked about the same chair they had to sit in to have their waiver denied. They are anxious to not have to come to washington. Did texas have its waiver denied by me . Tennessee . Indiana . Name a republican state that had a waiver denied by me. The sentiment was significant around that table of the day. Well get back and talk about that. I think i want to be clear. Its important to me. The republican states, and i had a very good relationship. We granted a lot. We did as much flexibility and im sure chairman price, secretary price will do even more, but thats important point to me. Despite what sentiment may be out there. I dont want to out anyone sitting next to me in that meeting. Heres the deal. This question was asked by one of the governors. If there is a waiver thats approved for one state, why can it not become immediately lly applicable to other states. I agree with that. I think thats exactly the type of action that i want to see from the administrative side. Some of the states that are looking at that include oklahoma and kentucky. Kentucky is trying to put work requirements and other things in their program. Im sure that will probably be approved. Yes. Kentucky governor was there. That was certain one of the issues talked about on his behalf. The third that you have talked about, House Majority leader said there would be four bills on the house floor that would deal with the other basket of changes you want. They are dealing with things like Association Health plan and medical malpractice. Not huge bills. Medical liability reform. Words matter here. Okay. Are there other things that you would like to see as part of this third prong . Just in the Broad Perspective, when i think back to the 14, 15 years ive been the congress, ive seen three major pieces of Health Care Legislation come through. Medicare part d when i was a freshman. Those things that have buy in from both houses of congress and both sides of the political divide seem toll be more enduring. While people will argument that the vote was kept open too long on part d and it wasnt bipartisan. It was a bipartisan agreement between the then president of the United States and the then chairman of the Health Committee who agreed they wanted to get this done. When it was done, theres some tough days with implementation of part d. January 1st of 2006, i cant tell you number of pharmacists i talked to who said i want you to listen to the same music that im listening to at 1800medicare because ive been on hold for hours. Their concern is they were filling prescriptions for medicare patients. They werent sure they were, if they were filling those prescriptions that they would be reimbursed. They did take care of that in really pretty short order. Were familiar with problems with the Affordable Care act in the early days. Harder to get things done because no republican had voted for that. Why would i want to leave my fingerprints at the scene of the crime . I wasnt there when this was created. I got a lot of phone calls. Andy was good enough to take my phone calls. They worked on it. They worked on it hard. I credit to them for the amount of work that they put in to create the flexibility of the rule that came out in october. Im sure this has happened before. I just never seen it. When you told me you were going to leave the Comment Period open because there were good ideas continuing to come in. I thought that was a positive step. The demonstration there when things have investment from both houses of congress and both sides of the political divide. The American People actually benefit from that. These things that are going to come forward that leader mccarthy talked about last night are those kinds of things. You got to get eight or nine senators to vote for those. Those are regular order things that will have to come through regular order. I would argue that will be more enduring policy that comes out of third act of this three act play. One last question. Well have to wrap it up. Chip reauthorization has not gotten much attention. We have to do that by september 30th. What does your crystal ball tell you on that. Its not supposed. It was funded until september 30th. Something will have to happen. Obviously were going to get through this stuff first. We have user fee agreements that are the fda, user fee agreements that have to come through our subcommittee immediately there after and state Childrens Health insurance thats on the radar screen as we go forward this year. Theres no shortage of Big Health Care things that have to pass the committee. Thats absolutely true. Thank you so much for joining us. We really appreciate it. Im sure that other people may have a question or two as you walk out the door. Thank you very much for your help. [ applause ] texas representative joe barton discussed the future of the replacement bill. This is 45 minutes. Thanks very much. Our next