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Congress Hearing on Obamacare; Interview with Frank Pallone and Cory Gardner

Aired October 29, 2013 - 10:30   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

REP. SANDER LEVIN, D-MI: And I might say if everybody would pitch in to make it work, the goals that have been set, would be more readily met.

That's what happened with the prescription drug program.

We all pitched in to make it work and it had major problems at the beginning and instead of standing in the way, we said, we didn't vote for it, let's make it work. And it begin to work.

If we all had the same spirit about ACA, it would be more than helpful. But then the chairman asked you about the -- the notices that are coming from the insurance companies. And I'd like to ask you about that.

The gentleman from Michigan who had an $800 Blue Cross plan, got this notice from Michigan Blue Cross. Went into the website with the help and navigators and ended up with a Blue Cross Silver HMO plan with tax credits, in that case, instead of $800 a month, it's $77 a month.

And let me refer you to the interview on "Meet the Press" with the Blue Cross Florida CEO, he was asked by David Gregory, in Florida the oldest and largest healthcare plan provider, Florida Blue Cross confirmed it is cutting 300,000 policies. And this is what the chairman of Blue Cross Florida of Florida. "We're not cutting people."

And I quote, "We're actually transitioning people. What we've been doing is informing folks that their plan doesn't meet the test of the essential health benefits, therefore they have a choice of many options that we make available through the exchange. And in fact, with subsidy, many people will be getting better plans at a lesser cost."

So this has become a matter of legitimate discussion and I think all of us would appreciate you addressing it.

MARLYN TAVENNER, ADMIN. CENTERS FOR MEDICARE AND MEDICAID SERVICES: Sir, again, going back to -- prior to the Affordable Care Act days, these individuals, in a small group, or individual market, had no protections. They had no guarantees of coverage, and they were still being charged somewhere between 20 percent or more premium increases year over year. So they could be kicked out at any time for pre-existing condition. Sometimes they thought they had coverage when they did not. And when they went in and had a cancer diagnosis or cardiac diagnosis, they found out maybe they had a $5,000 hospital limit, or they had certain disclaimers.

Then of course there was always, if you were diagnosed with asthma or high blood pressure or some other chronic disease, you might not be able to get coverage at all. So that's what's different, so that's the first part.

The second part is in 2010, we told issuers, to try to get some transition time, if they wanted to keep policies as they were currently defined, whether they were in a group market or an individual market, they could. And so some of them elected to do that.

Now some of them are moving to the new standards and the standards under the Affordable Care Act are pretty simple. You have to have the 80 percent MLR, so you can't be taking money more than the 20 percent to marketing, advertising profit.

You had to meet the 10 essential health benefits. You had to define co-pay deductible and diseases in clear and understandable terms, so people would know what they were buying. You had to have choices among plans.

And then there are folks in the individual market, who, when they go undecided, may qualify for tax credits. Some in some states may actually qualify for Medicaid expansion.

But this is not -- this problem existed long before the Affordable Care Act. Now folks are transitioning to the new standards of the Affordable Care Act which guarantee you can't be denied, you won't be kicked off of a policy because you developed a problem, you have -- may be eligible for tax credits, depending on your income.

So these are important protections that are now available through the Affordable Care Act. And I think that's important.

LEVIN: Thank you.

REP. DAVE CAMP, R-MI: All right.

Mr. Johnson is recognized.

REP. SAM JOHNSON, R-TX: Thank you Mr. Chairman.

Ms. Tavenner, thank you for being here.

You know, I've been hearing from folks back home, who, rightfully so, are very serious about their concerns and fears about their health care.

Stephen (ph) from Plano tried to purchase insurance through the exchange but ended up more confused and frustrated. Operators on the 1-800 line didn't have answers to his specific questions. They simply reiterated that anyone could sign up for the exchange, but he should wait until later that evening or the next day to apply since the systems were having technical difficulty.

Worst, a single father and police officer in Plano went to renew his 11-year old daughter -- daughter's plan, she has no medical problems, yet her premiums doubled. Doubled. Those are the real stories of fathers, mothers, sons and daughters who have to live with a law, that up to now, has completely failed them.

Ms. Tavenner, the administration delayed the employer mandate for one year. The treasury, witnessed before the committee, testified the reason the administration granted big business a one-year delay is, quote, "Employers and their representative have requested transition relief for 2014 because of concerns about the difficulty or cost of complying with the employer mandate."

Secretary Sebelius appeared before this committee and repeatedly said, "Obamacare was ready." It clearly wasn't.

Doesn't the failed launch indicate many individuals were going to have to at least have as much difficulty complying with the individual mandate as big business had with the employer mandate. Yet from the announcement last night, you've only given individuals a six-week delay.

CMS announced 700,000 people had submitted applications for exchange coverage, nationwide, but with all the challenges you have been facing, there some serious questions about what these applicants know.

CBS News reported, quote, "The shop and browse feature is not giving consumers the real picture. In some cases, people could end up paying a double what they see on the website."

So how many applicants applied based on the wrong premium information? Do you know?

TAVENNER: The completed applications were done -- the 700,000, these were individuals who completed applications and figured out if they were eligible for tax credit. I -- I do not know here CBS News is getting their information about erroneous tax credit, so I can't address that.

I will say that in the individual mandate issue, that folks can apply through March 31st. We have said publicly that we will have the website in good working order by the end of November. We have always predicted that folks will increase their interest in enrollment in December and probably again in March and so we believe that we are in good shape to handle that.

JOHNSON: Well, if you've identified the problem and are taking steps to identify who received faulty price information, apologize and provide the right information, are you doing that now?

TAVENNER: Yes, sir, if we've given people the wrong information, we will certainly correct it. But I'm not sure what CBS News is referring to.

JOHNSON: I'd like to bring to your attention a story which ran last week in Mother Jones, with the headline, quote, "How healthcare.gov could be hacked." Let me just quote from the article. "Security experts say the federal health insurance website is vulnerable to a common technique that hackers use to steal personal information."

As you may know, I'm chairman of Social Security Subcommittee, and one of my longest outstanding priorities has been to protect American Social Security numbers. So for the record, is Obamacare website 100 percent safe from hackers, who could steal Americans personal information, including their Social Security numbers, yes or no?

TAVENNER: We follow all the standards to protect information, including Social Security Numbers.

JOHNSON: Are you trying to say yes?

TAVENNER: Am I trying to say yes that we follow the standards to protect information? Yes, sir.

JOHNSON: You know, folks are confused and scared. They've heard horror stories that -- and are experiencing them, first hand, how can they trust the federal government to not only fix the website but, more importantly, give them the assurance that their personal information will be safe and their health care will be affordable, that if they wanna keep their current plan, they can do so.

The problems don't stop at the technical failures of a website. The real problem stems from the colossal failure to deliver what this law promised the American people.

Thank you, Mr. Chairman.

CAMP: All right. Thank you.

Mr. Rangel is recognized.

REP. CHARLES RANGEL, D-NY: Thank you so much, Mr. Chairman. And welcome to our distinguished Committee.

You may wonder why the administration appears to be under such severe attack by some members of this Committee, especially as it relates to our goal to provide health care for 30 million Americans that can't afford or don't have access to it. But it should give you some small comfort to know that historically the Republican Party always fought vigorously against these type of programs.

I don't think that one Republican voted for the Social Security Act, even though those old enough enjoy the benefits.

(UNKNOWN): That's not accurate.

(UNKNOWN): That's not accurate.

RANGEL: Well, we'll see. Maybe one or two, I don't know. (UNKNOWN): No.

RANGEL: But they opposed Medicare. I spoke with President Johnson and he shared with me at the ranch, the people that signed off on Medicare, and anyway, it's big government even if it saves lives. Who cares? You're against big government, so why should Obama be spared the attack because he wants Americans to be healthy and strong and productive?

We have to be consistent and you guys and ladies have been.

What I don't understand is that people aren't born as Republicans and Democrats, and there has to be somebody, regardless of party label, that has suffered the embarrassment and pain of being denied an insurance policy because they've been sick before.

The people who actually need healthcare the most are too high a risk for the insurance companies, and this body of Republicans and Democrats allowed things like this to happen.

When I was a kid, if my mother took three of us, three children, to see a doctor, and we weren't sick, they would think she's crazy. Because you couldn't afford a doctor. Now healthcare will provide you getting the type of treatment to avoid your being sick and having to lose your dignity in impersonal emergency rooms that provide the most expensive healthcare that we have.

But Republicans who have always been admired for being fiscal conservatives have certainly seen the price of health care, the lack of quality that we may have today, soar to become such a part of our national budget that, in my opinion, it's a threat to our national security.

Because as prone as some of you are to entering into conflict with other countries, you need healthy young people to fight these wars. And healthcare is important from birth throughout one's life.

So I don't know how you're going to explain when this program, which is destined to succeed, how politically you're going to explain your positions today.

And since your entire political program is locked into hatred for the president and this program, it seems to me that we have to find other ways for us to politically combat each other. Because I hate to see today that there's no Republican Party, and I have to rely just on my party for justice and fair play.

And so we have to come together some kind of way to see what's best for America.

Now you may not like this program, and it certainly has been disappointing as a start, but what I want to see more from this Committee is how can we improve and get quality health care for all Americans. This has to be a part of the goal that all of you have.

And you also have to recognize that when we're lucky enough to have public servants to work for the administration, whether they're Democrat or Republican, that they are servants the same way we are and they deserve some dignity as well.

And so, for America, I hope and have every reason to believe, like Social Security, like Medicare, that the goodness of the program will prevail. And if there's anything that we can do to help you, and there may be some Republicans that will join with me to make certain that we get rid of what is not working and make certain everyone has access to health care.

I wish I can see the politics involved in this, because I am a partisan. But a stronger America means a stronger party, and that's what we're all here for. And I just want to thank you for your dedication and for you to recognize that it's all political and we have to do our job and get on with it. Thank you for your service.

CAMP: Thank you.

Mr. Brady is recognized.

REP. KEVIN BRADY, R-TX: Just a quick fact-check on the blast from the past. Republicans did support Social Security and Medicare. And more recently, Republicans were the ones that reformed Medicare to add that important prescription drug benefit so we could have seniors lead healthier lives, stay out of hospitals, and enjoy their grandchildren more.

What's become abundantly clear, the flaw is not the website. The flaw is the law itself. This is what happens when you inject 159 new federal agencies, bureaucracies, and commissions between you and your health care.

And this was supposed to be the easy part. Just wait until you see the government making decisions about patient care, about reimbursements and treatments for -- that you receive from your local doctor and hospital.

Ms. Tavenner, I have a great deal of respect for you and I suspect many Republicans do. Yet the White House, Secretary Sebelius, you and your staff made repeated claims to the American public and to Congress that everything would be ready on time, everything was a go. None of that proved to be true.

Now we're told everything will be OK very soon. So why should the American people believe you now?

TAVENNER: Congressman Brady, I would go back to what has worked in the last three and a half years since the Affordable Care Act was implemented. We have been able to make a difference in the lives of coverage for young people. We've been able to...

BRADY: But specifically on the website in the exchanges. Why should the American people believe you now? You've had nearly four years to get it ready. Now you're saying in four weeks more, it'll be great. So what's different? Why should anyone believe these claims? TAVENNER: Because I think we've identified two major problems. One had to do with the initial volume. And despite our best volume projections, we underestimated the volume, the interest in the site. So that...

BRADY: Did (ph) you know that the volume isn't the same as the applicants in the enrollment? That you yourself visited the site. Clearly you weren't shopping for it. Others did as well. So to Chairman Camp's point, the number of applicants, the number of enrollees apparently still not known is pretty modest, wouldn't you agree?

TAVENNER: Well, but I would tell you that the number of visitors to the site and the number of people interested in completing applications was larger than even our initial projections. And we worked our projections off of the 7 million number that Chairman Camp mentioned. We also worked it off our history with Medicare Part D.

So we've added capacity to the system and we've improved system performance. So that's the first thing.

The second thing is we have found some, what I will call functional, or glitches, as we call them in the public term, in the actual application itself, which we're repairing. And that is the gradual improvements that you will see over the next four weeks. And that's why I'm confident about the end of November.

BRADY: Well, can I tell you, my constituents are frightened. Like millions of Americans, they are now being forced out of a healthcare plan that they like. The clock is ticking on a website that's broken. Their healthcare isn't a glitch. It's what they depend upon.

So, you know, you've been described as a quarterback of the Obamacare roll-out. I'm sure that's not the term you chose for yourself. But can you guarantee no American will experience a gap in their healthcare?

TAVENNER: So what I can guarantee is that we have a system that's working. We're going to improve the speed of that system.

BRADY: Excuse me.

TAVENNER: Yes?

BRADY: You're saying the system right now is working?

TAVENNER: I'm saying it's working. It's just not working at the speed that we want and at the success rate that we want. And those are the things we're working on.

We also have alternative methods for folks. They can use the call center. They can use paper applications. And then we have in- person assistance available in each state.

TAVENNER: So I can guarantee you that we can reach out to each individual and help them select a plan and enroll. So yes, sir. BRADY: But to my point, this is not supposed to be fixed until November 1st. People have just two weeks to apply, enroll, be confirmed. So what happens on January 1st when they have an illness, they need patient care, have not heard back from the government what do they do then?

TAVENNER: They actually have until March 31st to enroll.

BRADY: No -- but their plan has been canceled as millions of Americans have found out...

TAVENNER: You're talking about people who...

BRADY: So -- and again, I'm just trying to -- what my constituents want to know, what happens?

TAVENNER: The individuals who receive notices from their issuers is a different situation. They can certainly, obviously, sign up, transfer as we talked about earlier with Blue Cross of Florida or they can go on the exchange or call the call center....

BRADY: No, but my point is, it's been canceled. They don't have health care. They've tried to get on the website unsuccessfully. They don't know if they're enrolled. It's January 1st. They are facing a gap in coverage. What do you tell them?

TAVENNER: And I'm telling you, they can call the call center today and we will help them. They can go online and if they're not successful we can help them through the call center. We also have people in their individual markets that can help them in person. So there are more methods than just the website.

And I think that's important.

BRADY: I think what's become clear, as well is Obamacare is not ready. Question is, why don't we make it voluntary? Why don't we give Americans a choice so they are not forced into this health care that they don't want.

Yield back.

CAMP: Mr. McDermott is recognized.

REP. JIM MCDERMOTT, D-WA: Thank you, Mr. Chairman.

Mr. Rangel's asked me to correct something.

The vote coming out of this committee was on party line vote. There were no Republicans who voted for it when it left this committee.

(UNKNOWN): Will the gentleman yield?

(CROSSTALK)

MCDERMOTT: (OFF-MIKE) or there were 81 finally voted for it, mostly progressives, but there is none left in the Congress. (UNKNOWN): Yes, 84 percent of the Republicans voted for the Social Security Act 77 years ago. I'm glad we are debating current events here.

(LAUGHTER)

MCDERMOTT: Reclaiming my time, Mr. Chairman.

With the way my Republican colleagues have been fretting over the success of the Affordable Care Act exchanges, you'd never know they spent $24 billion shutting down the country to get rid of it. Suddenly they seem desperate to see a bill they didn't want actually work.

It's like the Annie Hall Joke: The exchanges are terrible and not enough people can enroll.

Now, this is one of the biggest reforms our country ever made, and we are only four weeks into Medicare -- or into it. Medicare wasn't built in a day. Part D didn't roll out with snags along the way. As others mentioned, many of the Republicans who are now calling for blood over this roll-out were begging for patience on Part D.

The kinks of that roll-out were easily brushed off by many GOP alarmists who sit on this dais. We waited six months to hold an oversight hearing on Part D. We are barely four weeks into this one and we're already declaring it dead.

It is premature death.

We would have loved to see this launch be seamless and smooth, but we can't get caught up in the glitches and technical difficulties and lose our perspective. Help lines are up and running. I want to put the first chart up, because I think you need to know that it's working in some states in this country.

We've had a health plan finder in the state of Washington --

(END LIVE FEED)

MARTIN SAVIDGE, CNN CORRESPONDENT: All right. We're going to cutaway for the time being now. You were just listening to Marilyn Tavenner's testimony to the House Ways and Means Committee on the Obamacare website fiasco. Let the grilling begin, I think is pretty much the headline there. This is going to be a very tough day for her.

And what it does is set the stage, of course, for her boss, Health and Human Services Secretary Kathleen Sebelius tomorrow because she is going to face a grilling of her own. And this is probably just the warm-up, as lawmakers on the House Energy and Commerce Committee take this up.

Republican Congressman Cory Gardner sits on the committee as does Democratic Congressman Frank Pallone of New Jersey. They both join us now from Capitol Hill.

Thank you both for being with us. Congressman Gardner, let me ask you this, what do you think of what you've heard so far?

REP. CORY GARDNER (R), COLO.: Well, I think it's clear from Director Tavenner's testimony that lack of transparency with this administration is a preexisting condition. The Obamacare roll-out has gone -- the Obamacare roll-out has moved into one big Obamacare cop- out as she can't answer basic questions about how many people are in and have received the insurance in the exchange.

She can't answer questions about young people joining, can't answer questions about if the target numbers are going to be hit by October 31st, how many people are in today. The lack of transparency is simply stunning.

POPPY HARLOW, CNNMONEY.COM CORRESPONDENT: And I want to get you, too, Representative Pallone of New Jersey. Thank you both also for waiting. I know we kept you waiting for a while and thank you for joining us together to talk about this.

What is your response? Because in that first long set of questioning from Chairman Camp, we heard him ask over and over for some specific numbers from her and her agency.

Can you tell us how many people have enrolled? Can you tell us how many are in which age group, how many are some of those critical younger enrollees?

And she said repeatedly, we will have those numbers in mid-November.

What's your reaction to that? Did you expect, did you want hard numbers so far?

REP. FRANK PALLONE (D), N.J.: No. I mean, look, the bottom line is that the enrollment period continues and more and more people are signing up either through the website or through other means. And the insurance doesn't go into effect until January 1st.

People can go, you know, to the 1-800 number. They can go to an insurance agent. They can, you know, there are various places like in my district on Friday we took people to the Food Bank where they can sign up.

So at this point, we're just trying to get as many people as possible to sign up. And they don't need the website in order to sign up. That's the point that I think she was trying to make. And the Republicans keep, you know -- I think the Republicans are trying to scare people. They give the impression that, you know, well, I don't know if you should use the website.

Well, if you don't want to use the website, try one of the other means. The issue now isn't how many people have signed up today. The issue is how many people will be signed up by January 1st.

And I think that we're making a real attempt now to fix the website. As of last week, I think three out of 10 people could enroll. Hopefully those numbers will increase. And by the end of November it should be 100 percent. But again, I don't know why there's all this emphasis on the website. You don't -- you can go through traditional means, insurance agents, 800 number.

(CROSSTALK)

SAVIDGE: Before we run out of time, I do want to ask you both, Congressman Gardner, you know, tomorrow, Kathleen Sebelius, let's talk about that.

What do you want to hear from her other than, maybe, I resign?

What is it you're expecting?

GARDNER: I would like to hear from her why the president's promise, "if you like your healthcare plan, you can keep it," simply isn't coming true for millions of Americans and why the president knew about it years ago. And yet still on his website said, if you like your health care plan, you can keep it.

I'm one of those Americans that got a cancellation letter because we have private insurance. We wanted to be in the same boat as all Coloradans. We have a private insurance policy in Colorado that as we said canceled. I got the same letter that millions of Americans are getting.

Yet, I would like to hear why this president told me I could keep my healthcare plan that I liked it, and yet it's being canceled. It's a disgrace what's --

(CROSSTALK)

PALLONE: It's not being canceled.

GARDNER: -- happening to millions of people around this country.

SAVIDGE: Congressman Pallone?

PALLONE: This is not true. Look, the fact of the matter --

GARDNER: I'll show you my letter.

PALLONE: -- if your insurance is being canceled, it's not being canceled because of the Affordable Care Act.

(CROSSTALK)

PALLONE: The insurance company is not telling the truth. I mean, they're using the Affordable Care Act --

GARDNER: (Inaudible) telling the truth.

PALLONE: Yes, of course. I mean, the bottom line is you may have your insurance, you can keep it. If your company is canceling your policy, it's not because of the Affordable Care Act. What the Affordable Care Act does is expands your options. So if you have insurance or you don't like your insurance, you can get a better policy at a more affordable price.

But I know it's true that companies and insurance companies are using it as an excuse. I mean, there's nothing we can do about that. They're going to say whatever they please. But it's simply not true.

GARDNER: But I have an individual insurance policy --

HARLOW: Let me jump in here, guys. There's actually a technicality, though, that our Joe Johns reported on earlier today about when you got your policy, did you have your policy before Obamacare was passed or did you get it since it was passed? That is something that is important there.

We have a minute and a half left in the show. We can't dig into all of that.

But I'm wondering, I mean, this a precursor to Kathleen Sebelius testifying on the Hill.

To you, Representative Pallone, what is your main question to her that you want an answer to?

PALLONE: Well, I think she's already answered the question about the website, which is that they have now working. And that by the end of November, everyone will be able to enroll.

I'm very concerned that this is just -- that this committee meeting, again, hearing, is just going to be another effort to sabotage the Affordable Care Act and not really get to the bottom of this glitch. She's already made it quite clear what they're doing to correct the glitch. So I don't even know why they're having the hearing.

But if they're going to have it, let's hope that they focus on ways, positive ways, to get rid of the glitch and have the website work again and how other people -- how people can sign up without using the website.

SAVIDGE: All right. We're going to interrupt both of you.

Gentlemen, thank you very much for staying. We really do appreciate, but Paul Ryan is speaking now. We want to go back to the hearing.