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Congressional Testimony
February 29, 2000, Tuesday
SECTION: CAPITOL HILL HEARING TESTIMONY
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TESTIMONY February 29, 2000 DONNA SHALALA SECRETARY HEALTH AND HUMAN SERVICES
SENATE APPROPRIATIONS LABOR, HEALTH AND HUMAN SERVICES,
EDUCATION FY01 PRESIDENT S BUDGET
BODY:
Testimony
of The Honorable Donna Shalala U.S. Secretary of Health and Human Services
before the Subcommittee on Labor, Health and Human Services, Education and
Related Agencies Committee on Appropriations United States Senate February 29,
2000 Good morning, Chairman Specter, Senator Harkin, and members of the
Subcommittee. I am pleased to appear before you today to discuss the President's
FY 2001 budget for the Department of Health and Human Services. At the outset,
let me thank you again, Mr. Chairman, for your leadership on the prevention of
youth violence and substance abuse and on the treatment of mental health -
issues which I will discuss in detail later in my testimony. I am honored to be
here with Secretaries Herman and Riley to continue our dialogue and coordinated
efforts in these areas. A PROUD HISTORY... Mr. Chairman, before I discuss our
plans for confronting the challenges that lie ahead, I think it is important
first to take a look back at where we have been. Over the past seven years, we
have worked together to develop innovative solutions that have improved the
health and well being of all Americans. Let me note just a few of these
accomplishments: 1.Working together, we have expanded enrollment in Head Start
from approximately 714,000 children in 1993 to an estimated 950,000 in this
budget, while at the same time improving the quality of the program, thereby
providing a strong foundation for success for hundreds of thousands of
low-income children. 2. Two years ago, the President called for an increase of
almost 50 percent over five years in the NIH budget as part of his Research for
America Fund. Since that time the NIH budget has increased by over $4.2 billion
and, with the funding proposed by the President this year, we will be ahead of
schedule in reaching our goal. In addition, we have increased the number of
Research Project Grants funded by the National Institutes of Health by over 30
percent, from 23,952 in FY 1993 to 31,524 in this budget. This represents a
dramatic expansion of our scientific knowledge base that will pave the way for
biomedical advances in the years ahead. 3.We have nearly doubled the number of
people receiving access to comprehensive combination drug therapy under the
Ryan White Care Act AIDS Drug Assistance Program (ADAP), from
almost 49,000 in 1994 to approximately 75,000 with this budget. 4.We have
improved the health of our seniors by increasing the number of healthy meals
served to older Americans under the Administration on Aging's Nutrition programs
from 240 million in FY 1994 to 279 million in this budget year. 5.With the
enactment of the Health Insurance Portability and Accountability Act of 1996, we
have helped individuals keep their insurance when they change jobs, guaranteed
renewability of coverage, and helped ensure access to health insurance for small
business. 6.Together with the states, we have undertaken the largest health care
coverage initiative since Medicare, namely the State Children's Health Insurance
Program. In just the two years since its enactment, the number of children
enrolled in SCHIP -- now almost 2 million -- has doubled. In addition, the
number of states covering children up to 200 percent of poverty has increased by
more than sevenfold. 7.Last year, the President signed into law the bipartisan
Ticket to Work and Work Incentives Improvement Act that allows people with
disabilities to maintain their Medicare and Medicaid coverage when they go to
work. It also includes a new demonstration program that allows people with
disabilities who are still working and are not sufficiently disabled to qualify
for Medicaid to obtain coverage and reforms the training system for people with
disabilities. 8.We created the Vaccines for Children Program, to finance
immunizations for children without private health coverage. Childhood
immunization coverage rates in 1998 were the highest ever recorded. Ninety
percent of toddlers in 1996, 1997 and 1998 received the most critical doses of
each of the routinely recommended vaccines, surpassing the President's 1993
goal. We also have undertaken a number of new initiatives to target emerging
threats and address long-standing problems. We have launched new initiatives to
promote research on disease prevention and health care quality, to improve the
quality of nursing home care, to provide support for our nation's children's
hospitals, and to increase the number of children adopted from our child welfare
systems. To educate Medicare beneficiaries about their health care options, we
have implemented the largest peacetime outreach campaign ever undertaken by the
federal government. We have stepped up efforts to increase the availability of
substance abuse treatment, to eliminate racial and ethnic health disparities,
and to address the AIDS crisis in minority communities. And we have invested
significant resources to prepare the nation to respond to the medical and public
health consequences of chemical and bioterrorist attacks. We have launched new
initiatives to protect the rights of Americans in managed care and protect the
privacy of electronic medical records, and most recently, to improve patient
safety and reduce preventable medical errors in our health care systems. While
we should be proud of past accomplishments, we must continue to address ongoing
health and human services challenges. These include: expanding access to quality
health care and extending protections to the uninsured and at-risk; supporting
working families and bettering the lives of our nation's children; encouraging
greater scientific advancement; and creating a healthier America. Thanks to our
continuing economic prosperity, we have a great opportunity to meet these
challenges. In the last two years, we have recorded back-to-back surpluses for
the first time since the 1950's. The combination of a strong economy, fiscal
discipline, and unprecedented advances in our scientific knowledge give us the
opportunity to make the investments needed to build on all of our achievements
over the last seven years. Mr. Chairman, the total HHS budget request for FY
2001 is $421.4 billion (Outlays). The amount before this subcommittee totals
$267 billion (BA), of which $44.8 billion is discretionary. This discretionary
component represents an increase of $4.5 billion over last year. Let me now
highlight the main components of our FY 2001 budget request. EXPANDED HEALTH
CARE COVERAGE We live in an age of remarkable advances in the biomedical
sciences. Yet too many of our citizens are denied the benefits of these advances
because they lack access to quality, affordable health care. Throughout his
Administration, President Clinton has made expanding access to health care one
of his most important goals. Working with the Congress, we have had some notable
successes, including enactment of the State Children's Health Insurance Program,
which today covers nearly 2 million children; the Health Insurance Portability
and Accountability Act, which allows workers to keep health insurance coverage
when they change jobs and limits the ability of insurers to deny coverage based
on pre-existing conditions; and most recently, the Ticket to Work and Work
Incentives Improvement Act, which allows disabled Americans to return to work
without losing their Medicare and Medicaid coverage. But even with these
successes, approximately one-seventh of the population still lacks health
insurance. Our budget seeks to address these problems through a number of
initiatives designed not only to expand access to care but to improve the
quality of health care as well. Expanding Coverage under Medicaid and SCHIP The
State Children's Health Insurance Program (SCHIP), enacted in 1997, now provides
nearly two million low-income, uninsured children with access to health
insurance, preventive medicine, and immunizations. While the success of the
SCHIP program has greatly enhanced the health of these children, many of their
parents remain uninsured. And there still are many children who are eligible for
Medicaid and SCHIP who are not currently enrolled. With the country's resources
growing, the economy booming, and the SCHIP program showing great progress, it
makes sense to take advantage of this opportunity to implement new options for
low-income working families without health insurance. The President's budget
includes proposals to create a new "FamilyCare" program that expands coverage to
the parents of children eligible for Medicaid and SCHIP, increase outreach
efforts, and simplify the enrollment process. Under FamilyCare, parents would be
enrolled in the same programs as their children, and states would receive the
higher SCHIP matching payments for expanding coverage to parents. To ensure that
the original intent of the SCHIP program is met, states would be required to
expand eligibility for children up to 200 percent of poverty before accessing
funds to cover parents. As is the case with children, priority in enrollment
would be given to lower-income parents before covering higher-income parents.
If, after five years, some states have not expanded coverage of parents to at
least 100 percent of poverty, they would then be required to do so. By 2006, all
poor parents would be eligible for coverage just as their children are today. We
believe that enrolling parents in Medicaid or SCHIP will not only improve their
health, but will also make it easier for entire families to access insurance
through one source, thereby increasing the number of children participating in
the program. This FamilyCare initiative is a practical, targeted approach to
encouraging greater insurance coverage. Over eighty percent of parents of
uninsured children under 200 percent of poverty are themselves uninsured, while
nearly two-thirds of uninsured parents (6.5 million) have children eligible for
Medicaid or SCHIP. The budget proposes to extend and improve the transitional
Medicaid program, which provides important health insurance coverage for
families moving from welfare to work. Our proposals would use existing state
administrative and delivery systems and no new bureaucracies would be needed. In
addition to covering parents, states also will be given the option to extend
Medicaid coverage to young people ages 19 and 20. If they do, they will also
have the option to cover kids up to age 20 under SCHIP. To further increase
Medicaid and SCHIP enrollment, the President's budget supports new efforts to
simplify eligibility and aggressively expand efforts to enroll eligible children
identified through school lunch programs. To ensure that children are not
overlooked in States that have different rules and procedures for Medicaid and
SCHIP, we also propose to require that States conform certain eligibility rules
between Medicaid and SCHIP. Our budget also proposes $10 million in mandatory
funding for competitive grants to States that develop innovative plans for
outreach to the homeless and the coordination of services across the Medicaid,
SCHIP, TANF, Food Stamps, and Mental Health and Substance Abuse programs. If
they do, they also will have the option to cover kids up to age 20 under SCHIP.
Finally, our budget seeks to reverse some of the inequities that have resulted
from the 1996 welfare reform legislation by giving states the option to provide
Medicaid or SCHIP coverage to legal immigrant children and pregnant women. The
budget also proposes to restore SSI and Medicaid eligibility to legal immigrants
who entered the United States after the enactment of welfare reform, become
disabled and live in the U.S. for five years. Parents of legal immigrant
children would also be eligible for coverage under our FamilyCare proposal. In
addition, the budget seeks to restore Food Stamps eligibility to legal
immigrants who were in the country before the enactment of welfare reform and
either subsequently reach age 65 or have children who are eligible for Food
Stamps. In addition, the budget will take an important step to improve the
health of low-income Americans by ensuring that they have access to drugs that
help them quit smoking. The budget will ensure every state Medicaid program
covers both prescription and non-prescription smoking cessation drugs, removing
a special exclusion now in law, and requiring states to cover these drugs as
they cover all other FDA-approved drugs. Modernizing and Strengthening Medicare
For the last thirty-five years, Medicare has been the cornerstone of our efforts
to ensure that all seniors have access to the quality health care they need and
deserve. However, since its enactment in 1965, much in the health care system
has changed, not only the types of care provided and the setting in which these
services are performed, but also the makeup of the population that receives
Medicare. These changes have dramatically increased the financial strains on the
Medicare program, and current actuarial projections show that by approximately
2015, just as the large baby-boom generation is becoming eligible, Medicare may
be faced with insolvency. The Clinton-Gore Administration budget also dedicates
$432 billion over ten years to Medicare to extend the solvency of the Trust Fund
until at least 2025 and to create a voluntary, affordable prescription drug
benefit. It includes a new, multi- billion dollar reserve fund that can be used
to add protections against catastrophic drug costs to the President's proposed
drug benefit. This financing commitment is part of a comprehensive plant to
modernize and strengthen Medicare to ensure that it can continue to deliver high
quality, affordable care in the 21st Century. These steps include making the
program more competitive; introducing private sector purchasing and management
tools; and continuing our historic fight against fraud, waste, and abuse. Over
the last thirty-five years, the development of new prescription drugs to treat a
variety of conditions has helped Americans to live longer and higher quality
lives. The centerpiece of the President's plan to modernize Medicare is a
voluntary prescription drug benefit that would be affordable and accessible to
all beneficiaries. This benefit, which would rely on market competition to
obtain lower prices, would have no deductible, and would pay half of all costs
up to $2,000 in FY 2003, increasing to $5,000 by FY 2009. The plan would fully
pay for costs for beneficiaries with incomes below 135 percent of the poverty
level, and provide premium assistance for those with incomes between 135 and 150
percent of the poverty level, while providing financial incentives to employers
to continue offering prescription drug benefits to current retirees. The
President's budget also proposes much-needed incentives to increase the
utilization of preventive services by Medicare beneficiaries. Our plan would
eliminate existing coinsurance and deductibles for covered preventive benefits,
including colorectal and prostate cancer screenings, pelvic exams,
mammographies, bone mass measurement, and diabetes self-management. The
President also is planning to develop a three-year demonstration for smoking
cessation services. By lowering the cost and expanding the availability of these
services, we will not only save lives, but will minimize the need for more
extensive, and expensive, treatments in the future. While we work to strengthen
Medicare to better serve current beneficiaries, our budget also includes
proposals to expand access to Medicare to groups who face barriers to health
insurance coverage. These proposals will allow Americans ages 62 to 65 to buy
into Medicare by paying a premium, provide a similar buy-in option for displaced
workers ages 55 to 62 who have lost employer-provided health coverage, and
provide COBRA coverage to retirees between the ages of 55 and 65 whose companies
have reneged on their promise to provide health benefits. To make these buy-in
options more affordable, the budget includes a proposal for a tax credit,
available to displaced workers over age 55 as well as all eligible persons ages
62 to 64, that would be equal to 25 percent of the buy-in premiums. As important
as our efforts to modernize the Medicare benefit package are, Medicare
recipients will be able to realize the full benefits of these new services only
when we give equal attention to strengthening and modernizing the management of
our health programs. The President's budget continues efforts to improve the
Health Care Financing Administration's (HCFA) management, building on the
five-part reform plan advanced last year to increase flexibility while also
increasing accountability. Our budget also maintains our commitment to fighting
fraud and abuse, investing in a new Medicare contractor oversight initiative to
address a number of concerns outlined in OIG and GAO reports last year. This
initiative includes funding to improve evaluation of program operations,
establish financial management controls at each contractor, develop an
integrated general ledger accounting system that will ensure clean audit
opinions into the future, and monitor and oversee these changes at all
contractors. These actions will augment the successful efforts we have
undertaken in partnership with you, Mr. Chairman, and Senator Harkin to combat
fraud, waste, and abuse in the Medicare and Medicaid programs. As you know, the
Department of Justice recently announced that, in conjunction with HHS, it had
achieved a $486 million settlement with a national health provider that had been
defrauding the Medicare program. This action is in addition to results reported
in latest Health Care Fraud and Abuse Control account report that indicated that
$490 million had been collected as a result of successful prosecutions in 1999.
Of that amount, $369 million was returned to the Medicare trust funds. In
addition, the Medicare Integrity Program reported an increase of 25 percent in
total overpayments prevented and identified in the first six months of FY 1999
compared to the same period the year before. These successful efforts are why
the latest Medicare Trustees' Report included this Administration's fraud and
abuse efforts as a contributing factor in slowing the rate of growth of the
Medicare program. Increasing Access to Health Care for Uninsured Individuals
Those who lack health insurance often are forced to rely on emergency rooms or
ad-hoc networks of facilities and individual health professionals for whatever
care they are able to receive, or to forgo any health care at all. Last year,
the President's budget requested $25 million to launch a new initiative to help
community health clinics, public hospitals, academic health centers, and other
institutions serving the poor to create new systems of comprehensive and
coordinated care that uninsured workers and their families could depend on, and
Congress responded by fully funding this request. To continue this effort, this
year the President is proposing to increase funding for this initiative to $125
million. This increase will allow as many as 40 to 60 additional communities to
receive grants to improve the capacity of safety-net providers. The President's
budget also continues to provide strong support for the nation's Community
Health Centers, which provide care to nearly 10 million low- income and
uninsured individuals in rural and inner city areas. Our budget requests $1.1
billion to support Community Health Centers, an increase of $50 million over
last year. Long-Term Care With more Americans now living longer than ever
before, one of the most pressing demands we face is the increasing need for
long- term care services. Studies show that the great majority of individuals
who need long-term care prefer to remain in their own homes and communities
rather than receive care in institutional settings, but this places a heavy
burden on the family members and friends who must provide supports for them.
More than half of these caregivers are women, and one-third have full time jobs.
Our budget seeks to address the pressing need for new long-term care solutions
through a multi-faceted initiative designed to help both the millions of
Americans who require long-term care and those who care for them. Our budget
invests $125 million to support family caregiver activities in the
Administration on Aging (AoA). This initiative will provide States and local
communities with the flexibility to design and provide caregiver support
activities to approximately 250,000 families nationwide who are caring for
elderly relatives with chronic diseases and disabilities. Services provided will
include quality respite care, information about local services, counseling, and
training for complex care needs. The budget also proposes $140 million over five
years to expand access to home and community-based care services under Medicaid
through an option to equalize income eligibility standards for those who need
institutional care but choose to live in the community. This long-term care
initiative also includes a $3,000 tax credit to provide support for those with
long term care needs and those who care for a disabled or elderly relative; an
innovative housing initiative to integrate assisted living facilities and
Medicaid home and community based care settings; and a program to provide
Federal employees, annuitants and their families with the opportunity to
purchase private long-term care insurance at group rates. Nursing Home Quality
Initiative As we begin to develop a support system for those who choose to
receive long term-care in home and community-based settings, we must also
continue to ensure that nursing home residents are receiving the highest quality
care possible. The FY 2001 budget includes $71 million for continuing quality
monitoring activities in last year's budget to improve federal and state
oversight of nursing homes. Now in its third year, this initiative supports the
efforts of states to strengthen enforcement and oversight of nursing home
quality and to crack down on those who repeatedly violate program standards.
Expanding on activities already underway, funding will support increased surveys
of repeat offenders, improved training for surveyors, and enhanced legal
services including resolution of the backlog of appeals. RENEWED SUPPORT FOR
CHILDREN AND FAMILIES Mr. Chairman, these investments in health care access and
quality, in improving our public health system, and in broadening our scientific
knowledge, all are fundamental to making sure that the new century is a time of
good health and prosperity for all Americans. But just as we honor our
commitments in the health arena, we also keep our commitments to improving the
lives of the nation's children and families. The President's budget keeps our
promise to work toward an America where every child, and every family, has the
opportunity to succeed at work, at school, and at home. HHS YOUTH VIOLENCE
PREVENTION ACTIVITIES HHS is pursuing a range of activities to assist in the
prevention of youth violence, and we have requested $78 million for these
activities. The Safe Schools/Healthy Students Initiative is an unprecedented
collaborative effort involving this Department, along with the Departments of
Education and Justice. SAMHSA is our lead agency for this important effort.
Through this initiative, we are assisting 54 school districts in designing and
implementing comprehensive educational, mental health, social services, law
enforcement and juvenile justice services for youth. The increase in this
program provided by the Congress for FY 2000 will enable us to increase that
number to 70-75 Safe Schools/Healthy Students grants by the end of the fiscal
year. In addition to its support for this partnership, SAMHSA has developed a
comprehensive set of activities to provide direct grants for exemplary practices
as well as a variety of activities for developing innovative technology,
technical assistance, evaluation and social marketing in the youth violence
prevention arena. The Surgeon General is developing a Report on Youth Violence
that may be completed this year. Local communities, private organizations,
academia, other federal departments, state and local governments, and other
groups are providing information and assistance to ensure the report soundly
addresses the prevention of youth violence. In addition, CDC is engaged in a
variety of activities including research on school violence and suicide
prevention. For example, CDC will evaluate programs for high risk youth and
publish and disseminate The Best Practices to Prevent Violence by Children and
Adolescents: A Sourcebook based on the input of experts from across the nation.
CDC also will initiate National Centers of Excellence on Youth Violence and a
National Youth Violence Prevention Resource Center. The Administration for
Children and Families (ACF) is proposing to build on these efforts by focusing
on the mental health needs of runaway and homeless youth. NIH research has
demonstrated behavioral interventions in the home and classroom that address
violence in children with behavioral disorders and is developing and improving
programs aimed at prevention, early recognition, and intervention for youth
violence in various community settings. Finally, the President has convened a
White House Council on Youth Violence, which includes representatives from the
Departments of Treasury, Labor, Justice, and Education. The Council's duties
include developing a citizens' information hub; producing reports on youth
violence; expanding the Safe Schools/Healthy Student model of collaboration;
providing tools for parents to deal with the issue of youth violence;
coordinating the federal research agenda; and developing further policy
responses. Expanding Substance Abuse Activities Even with all our efforts over
the last few years to expand the availability of services to those addicted to
drugs and alcohol, there continues to be a significant gap between the need for
substance abuse treatment and the capacity available to provide treatment.
Estimates by the Office of National Drug Control Policy show that less than half
of the five million individuals who need substance abuse treatment actually
receive these services. To further close this gap, the President's budget
includes a total of $3.3 billion in HHS for substance abuse treatment and
prevention, including $2 billion to support SAMHSA's substance abuse prevention
and treatment activities. Included in this request is an additional $54 million
for Targeted Capacity Expansion grants to support rapid and strategic responses
to emerging areas of need. The request also includes an increase of $31 million
for the Substance Abuse Block Grant, which will provide funding through the
states for over 10,500 community-based treatment and prevention organizations.
In all, our budget request will enable more than 16,000 additional individuals
to access treatment services. Improving Mental Health Services The Surgeon
General's Report on Mental Health, released in December 1999, has focused new
attention on the plight of those who suffer from mental illness. While about one
in five Americans experiences a mental disorder in the course of a year, many of
them will not receive the treatment they need. To address this problem, the
President's budget proposes an increase of $100 million for mental health
services provided by the Substance Abuse and Mental Health Services
Administration (SAMHSA). This includes an increase of $60 million for the Mental
Health Block Grant, to support state efforts to create comprehensive, community
based systems of care for both adults and children. It also proposes to create a
new $30 million Targeted Capacity Expansion Grant program to support prevention
and early intervention services, as well as local service expansion. Improving
Access, Affordability, and Quality of Child Care For the millions of American
families in which parents must work to support their children, the availability
of child care is often the difference between self-sufficiency and dependency.
But even though funding for child care has doubled under the Clinton
Administration, recent studies showed that in FY 1998 only ten percent of the
children potentially eligible for federal child care subsidies received them. As
we have said before, no parent should be forced to choose between the job they
need and the child they love. We must take steps to close this gap and help all
parents find child care that is safe, reliable, and affordable. As we close this
gap, we also must continue to improve child care quality. Study after study has
shown that safe, quality child care is essential to the healthy development of
our children. But the lack of quality care has forced too many parents to place
their children in less than desirable settings, and even low quality care can
place a heavy financial burden on low-income families. The President's budget
builds on our ongoing efforts to remedy these deficiencies with a comprehensive
initiative designed to not only make child care more affordable but also to
improve the quality of care. Our FY 2001 budget requests an additional $817
million, for a total of $2 billion, for the discretionary Child Care and
Development Block Grant. This increase will provide child care subsidies to
almost 150,000 additional low-income children. Also included in the $2 billion
total is $223 million to improve the quality of care, of which $50 million is
for infant and toddler quality care efforts; $19 million is for school-aged care
and resource and referral activities; and $10 million is for ongoing research,
demonstration, and evaluation programs. Our budget also proposes an increase of
$3 billion in mandatory funding over five years, including $600 million in FY
2001, to establish an Early Learning Fund. This fund will provide money to
states to offer community level challenge grants for programs that improve
childhood development and school readiness and the quality and safety of care.
The President's Child Care Initiative also includes critical increases for
activities in the Departments of Treasury and Education. Enhancing Head Start
Since its enactment thirty-five years ago, the Head Start program has been one
of our greatest success stories, ensuring that millions of low-income children
start school ready to learn. In 1993, the Clinton Administration set the goal of
enrolling one million children in Head Start by FY 2002. The President's $6.3
billion request for FY 2001, an increase of $1 billion, will keep us on track to
realize this goal, increasing the number of children enrolled to nearly 950,000.
A portion of these funds will be reserved for grants to unserved and
under-served populations. Consistent with the focus of the 1998 reauthorization
of Head Start to improve the quality of services, $418 million of the proposed
increase will be targeted for reducing class size, improving facilities, staff
training, and school readiness; obtaining safer and better equipment; and
attracting and retaining top-quality staff. Finally, our Head Start budget
request includes $564 million for the Early Head Start program, which will
provide 54,000 infants and toddlers and their families with continuous and
comprehensive child development and family support services. Increasing Parental
Responsibility through Child Support Enforcement One of the key underpinnings of
this Administration's support for working families is the idea of encouraging
personal responsibility. Nowhere is this more evident than in our actions to
step up child support enforcement, which is a critical support for children and
families. Child support collections have almost doubled since 1992, reaching an
estimated level of $15.5 billion in FY 1999. Our package of child support
enforcement proposals is self-financing and it increases collections to families
by more than $1.8 billion over five years. These proposals build on our success
in the program through changes designed to give states new options to get more
money to families and to improve enforcement tools to increase collections.
These actions are part of a comprehensive Administration initiative to promote
and ensure that non-custodial parents who can afford to pay child support do so,
and helping low-income non-custodial parents go to work so that they can support
their children through "Fathers Work" grants in the Department of Labor's
budget. Under one proposal, we would match State efforts to allow families still
working their way off welfare to keep a portion of the child support they are
owed, increasing payments to these families by $388 million over five years. A
second proposal provides States with the option to simplify their rules for
distributing child support to ensure that families that have left welfare will
keep all the child support paid by the non-custodial parent, resulting in
increased payments to families of $815 million over five years. Both of these
proposals build on our Family First distribution policies. Our package also
includes proposals for better enforcement techniques and program improvements
that will save the Federal government nearly $600 million over five years while
increasing payments to families by over $650 million. Ensuring Continued
Educational Excellence in the Nation's Children's Hospitals As we move to
increase the number of children with health insurance, we also must continue our
efforts to ensure that all children receive the highest quality care. Expertly
trained pediatricians are a critical ingredient in providing high quality care
to children, and children's hospitals play an essential role in their education,
training over 25 percent of all pediatricians and the majority of pediatric
specialists. Last year, the President proposed a new $40 million program to
support the vital role children's hospitals play in training physicians. This
year, our budget proposes to double this amount, providing $80 million to raise
support for approximately 60 free-standing children's hospitals to a level more
consistent with other teaching hospitals. Advancing Innovative Treatments for
Asthma Approximately 5 million of our nation's children suffer with asthma, and
children from low-income families are disproportionately affected. What makes
this particularly disconcerting is that the number of children afflicted has
doubled over the past 15 years, with the sharpest increases in rates among
children under age 5. Asthma is a leading cause of school absenteeism, and
children who suffer from asthma are often forced to limit their activities. To
address this growing health problem, our budget proposes $100 million over two
years in demonstration grants to states to test innovative asthma disease
management techniques for children enrolled in Medicaid and SCHIP. Through
appropriate clinical disease management, these programs will attempt to reduce
asthma related incidents and keep children with asthma out of emergency rooms
and in school. Providing Heating and Cooling Assistance to Low-Income Families
The Nation has been severely affected by this winter's fuel oil and propane
price increases which, in some cases, have doubled since last year. On February
16, the President took steps to respond to critical needs by releasing all
remaining emergency Low Income Home Energy Assistance Program (LIHEAP) funds for
this year, bringing the total heating assistance funds released this winter to
$295 million. On February 25, the President submitted a supplemental request to
Congress for an additional $600 million in contingent emergency LIHEAP funding
to help as many people as possible meet the additional heating costs and to
establish an emergency reserve in the event of a severe summer heat wave. It is
essential that Congress act quickly on this request to help to relieve the
burden of rising fuel bills. To further address this problem, I have encouraged
States to take advantage of the flexibility of current law to reach families
with high energy needs, including the option of raising State LIHEAP income
eligibility limits. Federal law allows States to set income eligibility limits
at the greater of 150 percent of the poverty level or 60 percent of State median
income. I also have encouraged States to fully utilize their options under TANF
to ensure low income families with children receive the assistance they need.
GREATER SCIENTIFIC ADVANCEMENT As we enter the new millennium, we stand on the
cusp of an era of that promises unprecedented scientific advances. However,
these breakthroughs only will be realized if we continue to make the necessary
investments in biomedical research. Our budget continues along the path we set
several years ago by investing in basic biomedical research as well as in
research that will lead to improvements in the quality of care, thereby moving
important scientific discoveries from the laboratory into our hospitals and
clinics. Investing in Biomedical Research Biomedical research has been at the
center of the unprecedented gains we have made in improving the health and
quality of life for all Americans. Breakthroughs that did not seem possible only
a few years ago are now within our reach, but it will require a sustained
investment for these endeavors to bear fruit. The President's FY 2001 budget
includes almost $19 billion, an increase of $1 billion over last year's funding
level, for biomedical research at NIH. This increase will support research in
such areas as diabetes, brain disorder, cancer, disease prevention strategies,
and development of an AIDS vaccine, and eventually lead to a revolution in our
ability to detect, treat, and prevent disease. This request will enable NIH to
fund 31,524 research project grants, the highest total in history, and enhance
activities in critical areas such as research on racial and ethnic health
disparities, biomedical information and technology, clinical research, and
genomics. Using Science to Improve Quality of Care and Reduce Medical Errors As
we make new breakthroughs in biomedical research, we also must work to see that
these scientific advances result in better quality health care. Even with all
our scientific innovations, a recent study by the National Academy of Sciences'
Institute of Medicine estimated that as many as 98,000 Americans die each year
due to medical errors. The Quality Interagency Coordination Task Force, which
HHS leads, just released its report, Doing What Counts for Patient Safety:
Federal Actions to Reduce Medical Errors and Their Impact, which incorporates
and expands on the report of the Institute of Medicine (IoM). Our report also
builds on the extensive and thoughtful review of the medical errors issue that
has been undertaken by this subcommittee. Our budget dedicates $20 million in
the Agency for Healthcare Research and Quality (AHRQ) and $13 million in the
Food and Drug Administration (FDA) for new activities to address medical errors
and patient safety. In addition, HCFA will require that hospitals implement
medical error reduction and patient safety programs in order to meet Medicare's
conditions of participation. Overall, our budget invests $250 million in AHRQ to
support research activities that will improve quality of care, and produce
better health outcomes. These resources will be used to step up research efforts
on the uses and tools of health information technology; sponsor clinical
prevention research and research to enhance patient safety and reduce medical
errors; and expand research on issues of workers' health. These activities will
help us to learn how best to translate knowledge into daily practice and improve
health care for all Americans. Our budget also invests and additional $20
million to implement a new Health Informatics Initiative designed to improve
patient care and health outcomes through the efficient and effective use of data
and information. This request will fund a set of cross- cutting and
agency-specific investments in information systems and health data, thereby
enabling HHS to assume a greater national leadership role in the establishment
of health data standards while also strengthening the information base for
decision-making, improving the uniformity and ease of transmission of health
care data, and protecting the confidentiality of health information. In
addition, our budget includes $45 million to enhance the Food and Drug
Administration's post-market activities. This includes funds to expand their
adverse-event reporting system and to allow FDA to investigate, identify and
prosecute those selling prescription drugs over the Internet without proper
certification. Food Safety Initiative Enhancing our capabilities to conduct
surveillance also will help us in our ongoing fight against the threat of food
borne diseases. Estimates show that food-related hazards are responsible for as
many as 76 million illnesses, 325,000 hospitalizations, and 5,000 deaths each
year. To combat these outbreaks, the budget seeks a $10 million increase for
CDC's Food Safety Initiative programs. These funds will support enhanced public
education efforts and the continued expansion of the PulseNet network of health
labs. This award-winning network performs DNA "fingerprinting" of disease
causing bacteria, enabling public health agencies to identify and respond more
rapidly to disease outbreaks. In addition, the FDA is seeking an increase of $30
million for its Food Safety Initiative activities. These funds will be used to
increase inspections so that all high risk food establishments are covered,
expand the number of examinations of imported foods, increase laboratory
capacity, broaden efforts to work with states and the industry to make standards
more consistent, and in conjunction with the Department of Agriculture and the
states, begin to implement the Egg Safety Action Plan prepared by the
President's Council on Food Safety. CREATING A HEALTHIER AMERICA Expanding
access and improving the quality of health care are crucial steps toward
ensuring that all Americans live long, healthy lives. But new threats to public
health continue to emerge, and many long standing health problems still pose
considerable risks. From AIDS prevention and treatment to food safety and the
control of infectious disease, our FY 2001 budget continues our work to
vigorously safeguard the public health. HIV Prevention Initiative As a nation,
we have made substantial progress in our fight to prevent the spread of HIV and
AIDS. Thanks to the use of combination anti-retroviral therapy, the AIDS death
rates in the United States continue to decline. But in some parts of the world,
and in some communities in the United States, the virus continues to spread
rapidly. Domestically, the impact of HIV among certain segments of the
population, especially minority communities, continues to be severe. In 1997, 45
percent of those newly diagnosed with AIDS were African American and 20 percent
were Hispanic. Globally, the AIDS pandemic continues to be a major threat,
particularly in developing countries. In sub-Sahara Africa, for example, it is
estimated that four million people each year are newly infected with HIV.
Internationally, the President's budget includes an increase of $26 million for
the Centers for Disease Control and Prevention to continue the initiative
undertaken last year to prevent the spread of HIV in developing countries.
Domestically, our budget request supports our ongoing initiative to reduce the
spread of HIV and AIDS in minority communities. It provides an increase of $50
million (including $10 million in reallocated funding) for CDC's domestic
prevention programs to encourage individuals at risk to avoid behaviors that can
result in the transmission of the disease. These funds will be directed to
community based interventions designed to reduce the rates of HIV infections,
with special emphasis on vulnerable populations including racial and ethnic
minorities, women, injection drug users and their partners, and young gay men.
Internationally, the President's budget includes $61 million for Centers for
Disease Control and Prevention (CDC), an increase of $26 million, to continue
the initiative undertaken last year to prevent the spread of HIV in developing
nations. Ryan White Up to one-third of the 750,000 Americans living with HIV are
currently not in care. As we step up our efforts to prevent the spread of AIDS,
we must also continue to help those who already suffer from this deadly disease.
The President's budget keeps this commitment by providing $1.7 billion for the
Ryan White Program, an increase of $125 million. These additional funds will
provide primary medical care, pharmaceuticals critical to treatment, and other
critical support services for those living with HIV and AIDS. This includes an
increase of $26 million for the AIDS Drug Assistance Program (ADAP), which will
allow a total of approximately 75,000 individuals to receive comprehensive
combination drug therapy. Reducing Racial Health Disparities One of the
long-standing priorities of this administration has been making sure that all
people receive the highest quality health care, regardless of their race or
ethnicity. Unfortunately, members of minority groups, including American Indians
and Alaska Natives, continue to bear a disproportionate burden of the nation's
disease and illness. The President's budget continues the effort to eliminate
these health disparities. A targeted response to this problem is the request of
$35 million to expand CDC's program of demonstration projects in six identified
areas of health disparities: infant mortality, cancer, heart disease, diabetes,
HIV/AIDS, and immunizations. Funds will support the continuation of ongoing
projects and the development of projects in two new communities. The budget also
proposes increasing funding for the Office for Civil Rights by nine percent,
including new program resources to ensure that our racial health disparities
initiative has a strong civil rights nondiscrimination component. We also
request an increase of $230 million for the Indian Health Service, the largest
funding increase in two decades, to implement a multi-pronged effort to improve
the quality of care for Native Americans. Family Planning Support for family
planning services has been a key factor in preventing over one million
unintended pregnancies each year. Family Planning Clinics provide a range of
valuable services including sexually transmitted disease and cancer screening
and prevention; HIV prevention and education; and contraception services and
counseling. As part of our strategy to prevent teen pregnancies, these services
have also contributed to reducing the teen pregnancy rate to its lowest level on
record (since 1976). Our FY 2001 budget request continues our strong commitment
to family planning services, providing an increase of $35 million over FY 2000.
These funds will support grants to family planning clinics which will enable
approximately 5.75 million low-income clients to receive reproductive health
services and clinical care. Preventing Emerging Infectious Diseases Thanks to
the extraordinary advances in transportation and other technologies and the
expansion of international commerce, we truly live in a global community. While
these advances have resulted in numerous economic and cultural benefits, they
also have placed increasing strains on our public health system. Since 1970,
more than 35 new infectious diseases have been identified. More recently, we
have begun to see the emergence of drug- resistant bacteria and viruses, and the
spread of older diseases to areas where they were previously unseen, such as the
recent outbreak of West Nile encephalitis in the New York City area. To combat
these threats, our budget requests a total of $202 million to support infectious
disease prevention activities at the Centers for Disease Control and Prevention.
This includes an increase of $26 million to fight emerging infectious diseases,
of which $20 million would be used to support the development of a national
electronic disease surveillance system, which will enhance the ability of state
and local health offices to respond to multi-state outbreaks of diseases and to
share information, both among themselves and with CDC. Combating Bioterrorism
The recent arrests of suspected terrorists at the Canadian border has reminded
us all of the serious threat that terrorism poses to the peace and prosperity of
our nation. The threats posed by bioterrorism are particularly deadly because of
their communicability and their ability to remain undetected for long periods of
time. Continuing our efforts to prepare for and respond to the consequences of a
bioterrorist event, the Department's budget includes $265 million for activities
across agencies to mount a comprehensive public health effort to combat this
deadly threat. This strategy includes four major components. First, our budget
strengthens critical components of our public health infrastructure, including
our surveillance systems, epidemiological and laboratory capacity, and
communications technology. Second, it continues funds for the purchase of a
stockpile of the pharmaceuticals needed to treat the most likely biological
agents. Third, it provides funds for research, development, and regulatory
review of new vaccines and new diagnostic screens for chemical agents. Finally,
it would support the establishment of an additional 25 local area health care
response systems, bringing the total number around the country to 97. Investing
in HHS Laboratory and Health Infrastructure To successfully overcome the public
health challenges of the 21st century, we must invest now to modernize the
infrastructure that provides the foundation for our public health and biomedical
research systems. Many of the laboratories at CDC and FDA are overcrowded and
outdated, while at the National Institutes of Health (NIH) the fragmentation of
laboratory space delays the pace at which new discoveries are made. Our budget
requests substantial increases to solidify this foundation and construct
state-of-the-art facilities. For CDC, we are requesting a total of $127 million,
an increase of $70 million, for laboratory construction at three sites. First,
our budget includes $85 million in FY 2001 and additional funding in FY 2002 and
FY 2003 to construct a laboratory to handle the most highly infectious and
lethal pathogens studied at CDC, as well as housing important work on antibiotic
resistant diseases, AIDS, sexually transmitted diseases, and tuberculosis .
Second, we request $20 million to complete and equip the Edward R. Roybal
infectious disease laboratory. Third, we request $4 million to design a facility
to replace our antiquated environmental health laboratory. The remainder of the
request will be used for security improvements and maintenance of existing
facilities. For NIH, we are requesting $149 million for intramural buildings and
facilities. Intramural projects include $73 million over two years to construct
a new facility to house the new National Neuroscience Research Center, and $24
million to begin design and construction of a new centralized animal facility.
Our budget also includes $20 million for new lab construction at FDA, as well as
$65 million for health facilities construction in the Indian Health Service
(IHS). RIGOROUSLY EVALUATING PROGRAM PERFORMANCE Our budget request for FY 2001
presents the annual performance information required by the Government
Performance and Results Act (GPRA) of 1993. Notably, this includes the first
GPRA performance report of HHS and its components, which compares FY 1999
results to the goals in our FY 1999 performance plan. Although GPRA reporting
must mature before its full value will be realized, our performance report for
this year shows improvements for critical HHS initiatives of the past few years.
SAMHSA reports that retailers in more States have complied with rules
prohibiting tobacco sales to youth than we had projected in our 1999 performance
plan. HCFA achieved its 1999 goal for reductions in Medicare payment errors a
year early, and pursues increasingly rigorous goals in FY 2001 and FY 2002. ACF
and its program partners, including states, exceeded performance expectations
when they moved 1.3 million welfare recipients into new employment. Information
like this demonstrates that GPRA can be a valuable tool that will enhance our
efforts to improve programs that serve the American people. As our performance
measures continue to mature and performance trends emerge, the GPRA data will
serve as important program indicators to support the identification of
strategies and objectives to continuously improve programs across HHS. A ROAD
MAP TO A BETTER AMERICA Mr. Chairman, as I look back at the journey we have
taken, I feel tremendous pride in what we have been able to accomplish. While
there were occasional bumps in the road and we did not reach every destination
we set out for, we have made great advances in improving the nation's health and
well being. Today I have placed before you a road map for the destinations we
have charted - improving health care access, coverage, and quality; making
America a healthier and safer place; expanding our scientific knowledge, and
giving all our children and families the opportunity for success - and these are
destinations we all wish to reach. Thanks to the unprecedented economy, our
fiscal discipline, and a new age of scientific breakthroughs, the conditions
under which we set out on this road have never been more favorable. FISCAL
MANAGEMENT AT CDC Mr. Chairman, before concluding, I would like to speak about
the recent news stories regarding the management of hantavirus funding at CDC.
Dr. Koplan and I are deeply concerned about CDC's failure to report these
reallocations to the Congress in a timely fashion. I strongly believe that the
full accountability and integrity of our budgeting and reporting efforts are
central to our responsibilities, and I have zero tolerance for inaccurate
reporting or inaccurate statements. We have an obligation to expend our funds
consistent with congressional expectations and to report in an accurate and
timely fashion. In consultation with Dr. Koplan, I am taking what I consider to
be aggressive and unprecedented actions to rectify this problem and restore the
trust of this Congress. These actions, which will be coordinated by the
Department and CDC, include: 1.The Chief Financial Officer (CFO) of the
Department of Health and Human Services (HHS) will take such actions as
necessary to certify all financial obligations made by the National Center for
Infectious Diseases for the remainder of the fiscal year. 2.The Department's CFO
also will work with Dr. Koplan to ensure that all senior decision-makers in the
National Center for Infectious Diseases receive certified budget execution
training. 1.CDC is commissioning an external review of the agency's fiscal
management practices. The review is to be completed within six months. The
results of this analysis will be communicated to the Congress as soon as the
review is complete. 2.CDC program managers will conduct a top-to-bottom
examination of CDC's 133 programs and projects to make sure there are no other
areas of concern. During the 90 day period CDC managers will be able to fully
and openly identify any area for which there may be a discrepancy between actual
expenditures and the information provided to Congress. Dr. Koplan will share
these findings with the Congress. 3.CDC has commissioned Pricewaterhouse
Coopers, a firm of independent auditors, to thoroughly examine our hantavirus
expenditures. The results will be communicated to the Chairman immediately upon
completion. When this audit is complete, CDC will expand the effort to the
entire National Center for Infectious Diseases. In addition, Dr. Koplan has for
the past year put in place numerous corrective actions to respond to the
Inspector General's report on Chronic Fatigue Syndrome. He has implemented new
financial management systems; initiated improvements in the agency's budget
displays and in the allocation of centralized agency costs. Again, let me state
very clearly that neither any senior manager at HHS nor I have any tolerance for
inaccurate reporting and that we are all devoted to restoring the credibility
and integrity that is central to the important work done at CDC. Chairman
Specter, Senator Harkin, and members of the Subcommittee: I would like to thank
each of you for all of the hard work you have done to make everything we have
accomplished a reality, and I look forward to working with all of you to meet
the challenges before us in this budget. I would be happy to address any
questions you may have.
LOAD-DATE: March 29, 2000,
Wednesday