<DOC> [109th Congress House Hearings] [From the U.S. Government Printing Office via GPO Access] [DOCID: f:26715.wais] HEALTHIER FEDS AND FAMILIES: INTRODUCING INFORMATION TECHNOLOGY INTO THE FEDERAL EMPLOYEES HEALTH BENEFITS PROGRAM ======================================================================= HEARING before the SUBCOMMITTEE ON THE FEDERAL WORKFORCE AND AGENCY ORGANIZATION of the COMMITTEE ON GOVERNMENT REFORM HOUSE OF REPRESENTATIVES ONE HUNDRED NINTH CONGRESS SECOND SESSION ON H.R. 4859 TO AMEND CHAPTER 89 OF TITLE 5, UNITED STATES CODE, TO PROVIDE FOR THE IMPLEMENTATION OF A SYSTEM OF ELECTRONIC HEALTH RECORDS UNDER THE FEDERAL EMPLOYEES HEALTH BENEFITS PROGRAM __________ MARCH 15, 2006 __________ Serial No. 109-130 __________ Printed for the use of the Committee on Government Reform Available via the World Wide Web: http://www.gpoaccess.gov/congress/ index.html http://www.house.gov/reform _____ U.S. GOVERNMENT PRINTING OFFICE WASHINGTON: 2006 26-715 PDF For Sale by the Superintendent of Documents, U.S. Government Printing Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800; (202) 512-1800 Fax: (202) 512-2250 Mail: Stop SSOP, Washington, DC 20402-0001 COMMITTEE ON GOVERNMENT REFORM TOM DAVIS, Virginia, Chairman CHRISTOPHER SHAYS, Connecticut HENRY A. WAXMAN, California DAN BURTON, Indiana TOM LANTOS, California ILEANA ROS-LEHTINEN, Florida MAJOR R. OWENS, New York JOHN M. McHUGH, New York EDOLPHUS TOWNS, New York JOHN L. MICA, Florida PAUL E. KANJORSKI, Pennsylvania GIL GUTKNECHT, Minnesota CAROLYN B. MALONEY, New York MARK E. SOUDER, Indiana ELIJAH E. CUMMINGS, Maryland STEVEN C. LaTOURETTE, Ohio DENNIS J. KUCINICH, Ohio TODD RUSSELL PLATTS, Pennsylvania DANNY K. DAVIS, Illinois CHRIS CANNON, Utah WM. LACY CLAY, Missouri JOHN J. DUNCAN, Jr., Tennessee DIANE E. WATSON, California CANDICE S. MILLER, Michigan STEPHEN F. LYNCH, Massachusetts MICHAEL R. TURNER, Ohio CHRIS VAN HOLLEN, Maryland DARRELL E. ISSA, California LINDA T. SANCHEZ, California JON C. PORTER, Nevada C.A. DUTCH RUPPERSBERGER, Maryland KENNY MARCHANT, Texas BRIAN HIGGINS, New York LYNN A. WESTMORELAND, Georgia ELEANOR HOLMES NORTON, District of PATRICK T. McHENRY, North Carolina Columbia CHARLES W. DENT, Pennsylvania ------ VIRGINIA FOXX, North Carolina BERNARD SANDERS, Vermont JEAN SCHMIDT, Ohio (Independent) ------ ------ David Marin, Staff Director Teresa Austin, Chief Clerk Phil Barnett, Minority Chief of Staff/Chief Counsel Subcommittee on the Federal Workforce and Agency Organization JON C. PORTER, Nevada, Chairman JOHN L. MICA, Florida DANNY K. DAVIS, Illinois TOM DAVIS, Virginia MAJOR R. OWENS, New York DARRELL E. ISSA, California ELEANOR HOLMES NORTON, District of KENNY MARCHANT, Texas Columbia PATRICK T. McHENRY, North Carolina ELIJAH E. CUMMINGS, Maryland JEAN SCHMIDT, Ohio CHRIS VAN HOLLEN, Maryland Ex Officio HENRY A. WAXMAN, California Ron Martinson, Staff Director Chad Bungard, Deputy Staff Director Chad Christofferson, Legislative Assistant Mark Stephenson, Minority Professional Staff Member C O N T E N T S ---------- Page Hearing held on March 15, 2006................................... 1 Text of H.R. 4859................................................ 10 Statement of: Gingrich, Hon. Newt, former Speaker of the House............. 26 Powner, David A., Director, Information Technology Management Issues, U.S. Government Accountability Office; Jane F. Barlow, M.D., MPH, MBA, IBM Well-Being Director, Global Well-Being Services and Health Benefits, the IBM Corp.; David St. Clair, founder and chief executive officer, MEDECISION, Inc.; Paul B. Handel, M.D., vice president and chief medical director, Blue CrossBlue Shield of Texas (a Division of Health Care Service Corp.); Jeannine M. Rivet, executive vice president, UnitedHealth Group; and Malik M. Hasan, M.D., chief executive officer, Healthview, retired chief executive officer, Health Net........................ 57 Barlow, Jane F., M.D..................................... 80 Handel, Paul B., M.D..................................... 114 Hasan, Malik M., M.D..................................... 132 Powner, David A.......................................... 57 Rivet, Jeannine M........................................ 119 St. Clair, David......................................... 93 Letters, statements, etc., submitted for the record by: Barlow, Jane F., M.D., MPH, MBA, IBM well-being director, Global Well-Being Services and Health Benefits, the IBM Corp., prepared statement of............................... 82 Clay, Hon. Wm. Lacy, a Representative in Congress from the State of Missouri, prepared statement of................... 154 Cummings, Hon. Elijah E., a Representative in Congress from the State of Maryland, prepared statement of............... 156 Ewen, Dr. Edward, Jr., prepared statement of................. 146 Gingrich, Hon. Newt, former Speaker of the House, prepared statement of............................................... 30 Handel, Paul B., M.D., vice president and chief medical director, Blue CrossBlue Shield of Texas (a Division of Health Care Service Corp.), prepared statement of.......... 116 Hasan, Malik M., M.D., chief executive officer, Healthview, retired chief executive officer, Health Net , prepared statement of............................................... 134 Porter, Hon. Jon C., a Representative in Congress from the State of Nevada, prepared statement of..................... 6 Powner, David A., Director, Information Technology Management Issues, U.S. Government Accountability Office, prepared statement of............................................... 60 Rivet, Jeannine M., executive vice president, UnitedHealth Group, prepared statement of............................... 122 St. Clair, David, founder and chief executive officer, MEDECISION, Inc., prepared statement of.................... 96 HEALTHIER FEDS AND FAMILIES: INTRODUCING INFORMATION TECHNOLOGY INTO THE FEDERAL EMPLOYEES HEALTH BENEFITS PROGRAM ---------- WEDNESDAY, MARCH 15, 2006 House of Representatives, Subcommittee on Federal Workforce and Agency Organization, Committee on Government Reform, Washington, DC. The subcommittee met, pursuant to notice, at 3:18 p.m., in room 2154, Rayburn House Office Building, Hon. Jon C. Porter (chairman of the subcommittee) presiding. Present: Representatives Porter, Norton, Cummings, Van Hollen, and Clay. Staff present: Ronald Martinson, staff director; Chad Bungard, deputy staff director/chief counsel; Chad Christofferson and Alex Cooper, legislative assistants; Patrick Jennings, OPM detailee/senior counsel; Mark Stephenson, Tania Shand, and Adam Bordes, minority professional staff members; and Teresa Coufal, minority assistant clerk. Mr. Porter. Good afternoon. I would like to bring the meeting to order, and I certainly appreciate all of you being here today. A quorum being present, the Subcommittee on the Federal Workforce and Agency Organization will come to order. This will be the first of two hearings that focus on a bill that I and Representative Lacy Clay from Missouri have introduced, namely, H.R. 4859, the Federal Family Health Information Technology Act. In the past decade, information technology has exploded onto the scene and revolutionized the way we do business in every industry. Companies from every sector of the marketplace have made huge investments in technology development and are reaping the benefits tenfold. For example, last month, General Motors announced that it would be awarding a $15 billion contract for information technology development. Analysts are saying that this is the single largest information technology contract ever awarded through a bidding process. If information technology is so pervasive in every industry from automotive to financial services, why has it seemingly bypassed one of the largest industries in the United States--health care? The answers to that question are many, but the good news is that the barriers blocking health information technology from growing are rapidly crumbling. People are working harder than ever to see that health information technology is not simply something that a few companies are using, but is a reality for all Americans. As health information technology systems are developed, I believe that not only will the quality of health care delivery improve dramatically, but so will the quality of health care overall. Some have estimated that over 90 percent of the activity spent on delivering health care depends on the exchange of information. Information flows constantly from patients to doctors to carriers to pharmacies and others, yet we are still using the processes of yesterday. With health information technology, we will not only decrease the amount of time it takes to exchange this information, but we will greatly increase the accuracy of the information that we exchange. One of the sad realities in the industry today is that medical errors are a major problem. The Institute of Medicine estimates that medical errors account for approximately 45,000 to 98,000 deaths each year in the United States and over 770,000 injuries due to adverse drug events, many of which could have been prevented through the use of information technology. If listed among deadly diseases, medical errors would be considered among the leading causes of death, even outpacing highway accidents, breast cancer, and AIDS. This is no slight to our medical professionals, who are the best in the world, but rather is an indictment of the antiquated technology they rely on. The use of technology will reduce medical errors by making health information more accessible to both patients and providers no matter where the patient is receiving the care. For example, the Boston Globe recently reported a senseless preventable death of a 79-year-old retired chemist who died after doctors at Massachusetts General Hospital treated him for a stroke when he really was having an insulin reaction. It is easy to see how an electronic medical record could have assisted the physicians in correctly diagnosing this patient. In a world where our cars, our pets, and our checking accounts have their own computerized record, it is time for every American to benefit from the same technology. Back home in Nevada, I spend a lot of time with foster kids. Unfortunately, health records for these children are scarce, which leads to needless multiple tetanus shots and other inoculations and multiple exams, and putting these children at risk for encountering a medical error because their prior medical histories are not always known. With the technological advances that we have made, this is unacceptable. And as you know, technology today is in dog years. For every 1 year, it is 7. Technology is changing rapidly, becoming more and more efficient and more and more accessible. As chairman of this subcommittee, I have been working closely with leaders from government and industry to develop legislation to bring health information technology to the health plans the Federal Government offers to its own employees. We have a wonderful opportunity to improve the quality and delivery of health care for the over 8 million participants in the Federal Employees Health Benefits Program and at the same time serve as a model to effect change elsewhere. Passing this up would be a huge mistake--a mistake we cannot afford since many lives would be unnecessarily placed at risk, especially since the solution is literally at our fingertips. The bill that I have introduced is based on very successful demonstration projects around the country, and we will hear from several individuals who were involved in those demonstrations this afternoon. The bill does recognize that there are three basic components of a complete electronic health record: No. 1, the carrier-based electronic health record; No. 2, the personal electronic health record; and, No. 3, the provider-based electronic health record. And recognizing this, the bill will establish a carrier-based electronic health record and personal electronic health record and provides incentives for creating a provider-based electronic health record. The first component of the bill will require all carriers participating in the Federal plan to create a carrier-based electronic health record for each of the participants. This piece of electronic health record will provide each participant and his or her providers with the information maintained by the member's carrier in a format useful for diagnosis and treatment. This claim-based component of the electronic health record can provide valuable information by leveraging the data, technology, and capabilities of health plans to improve health care decisions by patients and providers. This information is already there, and to ignore it would cause innocent people to unnecessarily suffer injury or death. Hurricanes Katrina and Rita serve as stark examples of the value of carrier-based electronic health records. When Hurricane Katrina hit, many medical records were destroyed or were not immediately available for patients, potentially putting some patients at great risk. Hoping to avoid the medical disasters associated with Hurricane Katrina, Blue CrossBlue Shield of Texas extracted data on its members who lived in the areas that were evacuated before Hurricane Rita hit. To help physicians care for Hurricane Rita evacuees, Blue Cross took its carrier based data for 830,000 members and converted it into an electronic health record available to any treating provider and did it in 4 days--830,000 members were converted into an electronic health record in 4 days. Those records contain historic and current data such as lab results, pharmacy information, and basic medical history. The second component of the bill requires a carrier to create a personal electronic health record at the request of an individual and would allow each individual to participate in his or her own health care by enabling the individual to input information into the electronic health record, such as personal health history, family health history, symptoms, over-the- counter medication, living will information, diet, exercise, or other relevant information and activities. As our guest today, Speaker Newt Gingrich, will mention, it will provide for ownership for health care, for individuals to have ownership over their own information and their health care. The third major component of the bill provides for a creative mechanism for individual providers to obtain funding for health information systems in their offices. Specifically, the funding would be available to providers to implement an interoperable electronic provider-based records system. The bill would establish a trust fund at the Office of Personnel Management that would accept private contributions. OPM will then issue grants from the fund to participating carriers to be distributed as performance incentives to their contracting health care providers to implement the provider-based electronic health records. Now, to tie all these components together, the bill will require that within 5 years of passage, each participant will have his or her own electronic health record contained on a portable digital medium. I would also like to quickly address three additional issues surrounding the bill. First is privacy. Privacy is always at the top of the list of concerns, and for the many groups that I met with, it was always the No. 1 issue that was brought forward, so rightfully so, it needs to be taken care of. There is nothing more personal and private than a person's medical information. Under my bill, we will ensure that participants' medical information is kept private and secure by requiring compliance with the Health Insurance Portability and Accounting Act. In addition, there are some great minds at the Department of Health and Human Services thinking long and hard about this important issue, particularly through the work of the Health Information Security and Privacy Collaboration. Second, I would also like to address interoperability. The administration has gathered the Nation's leading experts in this area to develop standards that everyone can work under. The bill that I will be introducing will follow the standards being developed by the Department of Health and Human Services. I am not interested in creating a system of electronic health records that will be obsolete or incompatible with other systems. Third, and finally, we must deal with the issue of cost. Under the bill, the Federal Employees Health Benefits Program rates should not increase and insurance carriers will not be burdened with paying the administrative costs to implement the requirements in the bill. The bill includes provisions to ensure that electronic health records are implemented over a number of years and that participating insurance carriers can tap into existing funds dedicated for administrative purposes being held by OPM during the implementation stages. Additionally, there are significant savings that can be seen with the implementation of health information technology in the Federal Employees Health Benefits Program. In my own State of Nevada, Health Plan of Nevada has done a tremendous job of implementing the HIT system. Their transition from paper records to electronic records has saved them nearly $1.7 million, resulting from a more than 50 percent reduction in medical records, staff, and paperwork, and certainly the errors. The think tank Rand Corp. estimated that, in addition to the saving of lives, the U.S. health care system could save as much as $162 billion annually with the widespread use of health care information technology. Making electronic health records available for patients is the SMART thing to do, and SMART serves as a perfect acronym to demonstrate the strengths of the health information system. ``S'' is very simple; it stands for Significantly reducing medical errors. ``M'' stands for Making prescription errors extinct. ``A'' represents the prevention of Adverse effects from conflicting course of treatment. And the ``R'' stands for Reducing redundancy of testing and paperwork. And ``T'' stands for recognizing that it is Time to improve the quality and the delivery of health care in the United States for every American citizen. The bottom line is simple: the technology is there to save lives and improve the quality of health care. It would be a colossal error to not take advantage of using technology to turn valuable claims data, for instance, into electronic health records. There are many, many successful HIT demonstration projects throughout the country that have shown us that this can be done. The Federal Employees Health Benefits Program cannot afford to wait any longer. I look forward to the discussions today from our experts and from all the witnesses. [The prepared statement of Hon. Jon C. Porter and the text of H.R. 4859 follows:] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] Mr. Porter. I would now like to recognize Eleanor Holmes Norton. Would you like to---- Ms. Norton. Thank you, Mr. Chairman. I am pleased to speak for this side. I want to thank you for this initiative. This is a very important initiative because you are getting into some of the really important issues if one is serious about this matter. I want to thank my good friend and former Speaker of the House, Newt Gingrich, and welcome him back and recall our fond days of working together. The former Speaker and I worked together closely on many projects affecting the District of Columbia and always on a win-win basis. We did not agree on many subjects, so we got together and figured out how to do it on a basis that we could agree. And in that spirit, I think we should approach this matter because, Mr. Chairman, if I may say so, the one thing I don't think we have to do is to convince people of the necessity of finally applying technology to the medical sector. Indeed, the medical sector is well nigh primitive as compared with virtually every other major sector in American life, and I really don't think it is because the various components of that sector are ignorant of the advantages of technology. As I say, one has to live in the technology age perhaps a few hours, only a few hours, considering how far we have come to understand what the advantages would be. And, therefore, as with any intriguing issue like this, the way to approach it is only, frankly, with respect to the hard questions. The easy ones are settled as far as I am concerned. It is not what to do. It is how to do it that has received so little, if you will forgive me, of the gray matter that it will take to finally bring the medical sector into the same part of the 21st century that the rest of America is in. And considering how much of our resources they eat up, we better figure out how to do that. I certainly believe it is quite appropriate, Mr. Chairman, that the Federal sector, even Federal employees, should always lead the way. We ought to be the best sector when it comes to health care. Would that we were, we ought to be the best sector when it comes to showing the private sector how to do it so we are all on the same page. I may have a little disagreement with some who speak first and foremost--as you do not, Mr. Chairman--about the importance of technology in the medical field as saving money. So I think we ought to put that aside. Sure, it will save money over years. But as with everything, we ought to say to everybody there are up-front costs of investment and you have to understand that if you want the advantages. And some of the advantages you cannot do without. We should not play that down, and those up-front costs cannot come from the cost of health care, which is already in such great ascendancy that nobody can find it. And if I may say so, Mr. Chairman, I think it has something to do with the reluctance of the medical sector to bite off this issue at all. So you have wisely tried to find a way to deal with that matter. It is not, frankly, costs and I would never try to sell it to the American people and certainly not to this Congress this way. Neither the American people nor the Congress of the United States believes in the notion that you invest and the more you invest and the more wisely you invest, you get a yield. We are a country that believes in instant yield. You invest a little and you get a whole lot out. So you invest a little in education and everybody comes out, you know, going to college and you are at the top of the list instead of at the bottom. Not in the private sector. We understand that you do not get a benefit for a long time. You do not look at how a company is doing by finding whether there is a profit yet, if it goes for years and years without a profit, you understand that. In selling this, we have to make clear people understand what they do get out of it, that they are going to have to invest, and that gradually this will pay off. What will pay off almost immediately, if we do it right, it seems to me, is the terrible price we pay in mistakes in the health care system in an utterly mobile country, in not even knowing or remembering who the health care providers were, what the medications were, forgetting perhaps or having no paper trail to vital information that affects your health, a world in which pharmaceuticals are able to do more and more for you, but you got to have a lot of information before they do what they are supposed to do. No question in my mind we got to do that. The more advanced medical science gets, the more we need medical technology to help us matriculate through all that is now available to us. This issue raises profound problems. The way in which you propose to fund this matter, Mr. Chairman, would probably raise some problems for lots of folks. The notion of the use of reserves in any way would have to be looked at very carefully. I take no opinion on it now, but I do note that even some of the private sector carriers have raised questions about that kind of use. Questions of liability go, of course, to privacy, but well beyond that, carriers themselves begin to raise the notion that even if you get the kind of security that most people do not trust, frankly, the technology system to give us, with firewalls and everything else you can talk about, whether or not they want to be responsible for having the medical records of everybody in there, you know, Members of Congress, people with security clearances, people whose identity is not supposed to be known at all--I mean, it is the hard questions that interest me, not whether or not, you know, my next-door neighbor and I can go in and I cannot get his and he cannot get mine. It is the hard questions. And it is some of the questions that technology has not even now begun to deal with in the ordinary course. I am the last one to say they cannot deal with it. This may be the way in which there is a real incentive to deal with these questions. But they have to be dealt with. I will not say anything about privacy except this one thing, Mr. Chairman. I think that the Federal work force is an appropriate guinea pig to experiment on--that is to say, if, in fact, you have willing guinea pigs. Now, if you are going to put people's medical records out there in the great cyberspace beyond, just let me say right here don't go to--as your counsel, as the one who went to law school---- Mr. Porter. Actually, you are my Congresswoman. Remember, I live in your district here part-time. [Laughter.] Ms. Norton. As your Congresswoman for the period during which you are in Washington, as your counsel, do not even consider everybody is in it and you have to opt out. You cannot start with even a small pool of people are in it unless you opt out--not when you are dealing with people's medical records, not when you are dealing with that one group of records that people most fear getting beyond whom they want to get--not when even if your doctor gets it and it is online or your doctor or the hospital that you move to, you don't now if it is the clerk there, if it is somebody else, other than the professional who gets it. You have to deal with the hard questions, I say. Let me leave you, Mr. Chairman, with this one phrase: ``Medicare prescription drug program.'' If you keep that in your head the whole time and all of the glitches that came from throwing all those people out--and, by the way, we told the poor people, you all are in so you do not even have to worry about it, until all over the country people said that we cannot find the names. If we are going to do this--and I would very much countenance our doing it--we should take a very small pool of the willing and test it. They will be all around us. There will be the computer nuts who want to be in this small group. There will be people who are intrigued and want their records in the same place. They may live in the same place. There are a whole bunch of them. We have 3 million folks who work for the Federal Government. It would be lovely if they could all be in the same kind of unit. And part of the art of this will be figuring out who should try it out, making sure that they are willing, and again, as your counsel, I say make sure they sign that they have been willing. And then let us go for it and see what we can find out, just as I expect to find out much from hearing from our witnesses today. Thank you again, Mr. Chairman. Mr. Porter. Thank you, Congresswoman. I appreciate your comments. Next I would like to introduce my cosponsor, Mr. Clay. Mr. Clay. Thank you. Thank you, Mr. Chairman, and especially for calling today's hearing on ways we can improve the use of information technology in our health care delivery system, and also thank you for inviting me to sit on the panel today on the Federal Workforce and Agency Organization Subcommittee. I appreciate that. I especially want to express my gratitude to you for our mutual efforts in developing health IT legislation that can benefit our public health infrastructure for generations to come. And as you mentioned earlier, the Rand Corp. recently estimated that the implementation of a nationwide health care information network that is utilized by 90 percent of providers will produce an annual savings of approximately $162 billion while reducing the number of adverse patient drug reactions in hospitals by more than 2 million per year. The only way to achieve these outcomes, however, is through the leadership of the Federal Government, and I am a proud cosponsor of Chairman Porter's Federal Family Health Information Technology Act of 2006. This bill utilizes the market power of the Federal Government by establishing a process for the development of electronic health records for all Federal employees by utilizing our Federal Employees Health Benefits Program for EHR purposes. We are creating a model for consumers, employers, and insurers to build comprehensive electronic health records for all individuals. In addition, I have recently introduced H.R. 4832, the Electronic Health Information Technology Act of 2006, along with Chairman Porter. H.R. 4832 seeks to accomplish two major goals: first, it will codify the office of Dr. Brailer and strengthen his role as the leading health information technology standard-setting authority in the Federal Government; and, second, the bill seeks to partner with the private sector through grants and a direct loan program that will provide key economic assistance for institutions seeking to expand their EHR capabilities. If we continue our pursuit of utilizing IT through the health care delivery system, we are sure to experience shorter hospital stays, improved management of chronic disease, and a reduction in the number of needless tests and examinations administered over time. The creation of such a network will prove far more efficient in both economic and human terms. This concludes my remarks, Mr. Chairman, and I ask that they be included in the record. Mr. Porter. Without objection. Mr. Clay. Thank you. Mr. Porter. We have some procedural matters, and I ask that we have unanimous consent that all Members have 5 legislative days to submit written statements and questions for the hearing record; that any answers to the written questions provided by the witnesses also be included in the record. Without objection, so ordered. I also ask unanimous consent that all exhibits, documents, and the materials referred to by Members and the witnesses may be included in the hearing record; that all Members be permitted to revise and extend their remarks. And without objection, it is so ordered. It is also the practice of this subcommittee to administer the oath to all witnesses, so if you would all please stand, I would like to administer the oath, and please raise your right hands. [Witnesses sworn.] Mr. Porter. Let the record reflect that the witnesses have answered in the affirmative. Please be seated. We are honored today to have a very special guest who is a leader in many areas of our country on many issues, but one in recent history, in combination with, I believe, Senator Clinton, he has become a champion on moving health information technology forward. Mr. Gingrich, Honorable Newt Gingrich, understands that health care is only as good as its weakest link, and a weak link is that of information flow and some of the current technology. I believe that Mr. Gingrich also understands that we have some of the best doctors and health care professionals in the world, but we need additional information technology available. So, Mr. Gingrich, we welcome you today and look forward to your comments, and you are now recognized for 5 minutes. STATEMENT OF HON. NEWT GINGRICH, FORMER SPEAKER OF THE HOUSE Mr. Gingrich. Well, thank you very much for inviting me to this very important hearing, and I am delighted to see a bipartisan effort such as this by Chairman Porter and by Congressman Clay, and it is something I very strongly support as a general direction. I am also delighted to be back with my good friend, Congresswoman Norton, who has done just a tremendous job representing the city, and under very difficult circumstances at times, and has been stunningly effective. I also want to note that you have a very, very good series of panels. Dr. Malik Hasan, who has been a pioneer for many years in this area and who at HealthTrio has developed a SNOMED-based language approach that is very sophisticated and the next generation, Dr. Jane Barlow of IBM, and others are all going to be, I think, very helpful to you. I do think bipartisan efforts in this area are useful. That is why Senator Clinton and I actually met launching a House bill. Congressman Tim Murphy and Congressman Patrick Kennedy introduced a bill in this general area, and we shocked everybody by showing up together to say we were for it. But I think this is an area where we can save lives and that is very important. I start with a very simple premise. Paper kills. Paper prescriptions increase medication error; 8,000 to 9,000 Americans a year die from medication error. Paper records in hospitals make it much harder to have accurate, quality systems; 44,000 to 98,000 Americans a year die from errors in hospitals. If we had a pandemic, whether it was the avian flu or an engineered biological attack, the losses because of the absence of personal electronic health records could be in the millions. I would also point out that personal health records are not a radical new idea. The Veterans Administration, an area where Government has truly pioneered, has been a leader and now has over 13 million electronic health records. PeaceHealth in Oregon, Washington, and Alaska has about 1,400,000 people with electronic health records. The Mayo Clinic in Jacksonville has been paper-free since 1996. Kaiser Permanente has about 13 million people with electronic health records. And TRICARE, the Defense Department health system, is beginning to roll out an electronic health record. So the capability is real. We at the Center for Health Transformation believe that the Federal Government can dramatically improve the health of all Federal workers with personal health records, and I agree with Congresswoman Norton's observation that it is better to get into this by volunteerism and incentives than it is to try to coerce everybody. But let me just point out that 93 percent of the country believes they should have the right to quality and cost information before making a health decision; 90 percent of the country believes you should mandate electronic prescribing in order to avoid medication error. There is a huge potential market that will sign up for this if given a chance, and it has an impact both in saving lives and in saving money. The Indiana Heart Hospital, for example, reported an 85- percent reduction in medication error by going to electronic records. PeaceHealth in a pilot project in Eugene, Oregon, using a GE Healthsystem model, indicated an 83-percent reduction in medication error, a 40-percent improvement in diabetes control, and a 100-percent improvement in LDL control for cholesterol. So these are important things. I would urge--and I believe your bill captures this-- individuals should own their own personal health record. This is about their life. Doctors can keep a copy for legal and administrative and medical reasons. Hospitals or labs can keep a copy. But the core universal document should belong to the individual, and current privacy laws protecting personal health information clearly apply to electronic data as well. Let me go a step further and say you should in passing recommend to your friends on the appropriate subcommittee that Medicaid needs to change its law so when people leave Medicaid, the information could actually be transferred to their job or business. It currently is not. It is technically blocked. And it strikes me as an anachronistic and actually a destructive provision. The individual's right to know, I would urge the committee to look at myfloridarx.com and floridacomparecare.gov. These are two Web sites developed by Governor Jeb Bush, and the Federal Employees Health Benefits Plan should offer exactly the same service nationally for all Federal employees. Myfloridarx.com, you can actually go online, put in your Zip code, the drug you want to purchase, and every drug store in your area shows up with its price. And it turns out in one neighborhood within 2 miles, there is a 100-percent difference to buy a particular drug. At one drug store it is $101. In another drug store, it was $203. And as you can imagine, people rapidly talk to each other when that price differential is that big, and so it is a big, powerful tool to give citizens the power to make choice to save their own money to lower costs. The floridacomparecare.gov actually lists number of procedures done by a hospital, quality of the outcome, and price, and is already having a substantial effect in informing Floridians. I would also suggest you look at the Humana and Blue CrossBlue Shield of Florida joint venture called Availity, where they are now going to connect at least a third of the State, and if they add Medicaid, over half of Florida will begin to have medication and other records online. I would also point out, as Congressman Clay noted, I think with legitimate pride, that in addition to the work you are doing, which is exactly right, there is effort underway with Congressman Clay's H.R. 4832, with the bill that Chairwoman Johnson and Chairman Deal introduced, H.R. 4157, with Congressman Gingrey's H.R. 4641 creating a tax deduction for doctors who want to buy equipment. I would strongly urge you to encourage your associates to reform Stark and anti-kickback law so that hospitals can provide electronic health records, because if you combine that with this bill, you won't have to have any kind of trust fund. The fact is if you modify Stark and anti-kickback rules, the hospitals of this country will save so much money by having electronic transfer of information rather than paper transfer that they will provide virtually every doctor in the country with an electronic health record capability at no cost. They are today blocked from that by an essentially obsolete law. Let me also suggest that we need an accurate scoring caucus. Fred Smith of FedEx was the first person who got me to think about this because he pointed out that he could never have invented FedEx with Congressional Budget Office scoring, because they cannot distinguish investment from cost and they do not understand market effects. You are about to see this with Medicare because the market effect of the new drug benefit is going to come at least 30 percent under the projection in cost because it turns out competition is driving down the cost, and we are actually driving down the cost of prescription drugs for America's senior citizens. Central Utah Multi-Specialty Clinic invested in electronic health records. They believe they will save $14 million over 5 years. I do not believe the Congressional Budget Office would score a penny. The Henry Ford Health System in Detroit has introduced electronic prescribing. They believe for a $1 million investment they saved $3.5 million the first year in the cost of drugs as doctors prescribe less expensive medication, and they believe they are saving 3 hours a week per nurse for not having to sit online talking to a pharmacist. I do not believe the Congressional Budget Office would score a penny. If we could take the $4.4 billion a year in waste that the New York Times estimates for New York State Medicaid alone, if you could take the fraud and waste out of the current system, and if you could take the inaccuracy and paper out of the current system, I think we could afford to cover with a very large tax credit every single citizen and have a 300-million payer system. I give you this as background because you cannot get there as long as the Congressional Budget Office has an obsolete, reactionary, bureaucratic model of scoring that denies the power of the market and denies factual evidence from the private sector. That is important for this project because one of the things I want to suggest to you is that you consider introducing as part of this--and I like your bill very, very much. But consider something we did to get hospital quality reporting. In the Medicare bill, we said hospitals that report quality will get 0.1 percent more from Medicare, and hospitals that fail to report quality will get 0.1 percent less. That happened to score out at zero under CBO rules. I would urge you to consider that by the 3rd year the Government will pay more if you have an electronic health record and less if you have a paper model. And the analogy I will give you is electronic ticketing. Electronic ticketing for airlines is not more expensive. It is cheaper. And it is so much cheaper that Continental Airlines 2 years ago announced that for 1 year they would give you a paper ticket but charge you $50 for the paper ticket, and at the end of 1 year they would never give you a paper ticket. You could print out your own at home, but they were simply never again going to deal with having to have paper. Now, this is the direction of the future. I very strongly support this bill, and I will close with this observation because I think this is a very intelligent bill moving in exactly the right direction. And I particularly like, Chairman Porter, your point that this would not--as I understand your interpretation, this would not have OPM creating an entire new pattern of standards but, rather, would have OPM looking to HHS to adopt and follow the leadership of Secretary Leavitt, who I think is doing an extraordinary job in this general area. The reason I really like your bill so much is that you are the first folks I have seen who are directly using the power of the Government as a purchaser--not as a regulator, not as a controller, but just simply saying, look, if you want to come and provide insurance for the largest single private purchasing of insurance in the world, which is the Federal Employees Health Benefits Plan, terrific; we just want you to migrate toward making sure that any Federal employee that wants it can have an electronic health record for themselves and their family. Using the Federal Government's purchasing power will change the health system faster than any possible regulatory regime, and I think this bill is a very, very important step in the right direction, and we would certainly do anything we could--I would personally--to try to be helpful in making sure that this bill gets a full hearing, and I would only hope it is signed into law this year. [The prepared statement of Hon. Newt Gingrich follows:] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] Mr. Porter. Thank you very much for your kind comments and certainly the insights. You know, a challenge is the provider side. I am old enough to remember my doctor that carried the little bag and actually made house calls. And the doctors of today are under a lot of pressure, a lot of challenges, from Federal regulations, you know, the file cabinet police that they are concerned that they are going to be put out of business, privacy, also medical liability. And I would like to ask you a question about the providers, but also add a comment to that. A companion to this bill I am going to be proposing is a medical liability insurance incentive for the providers that take part in using appropriate technology, that there be an incentive to reduce some of their costs. Because you know medical liability cost are literally putting health care professionals out of business. We have had signs in Nevada at OB/GYNs on their buildings that say ``For Rent'' because they are concerned about liability, the point being that we have had some improvements in Nevada as of late, but the medical liability is not in my jurisdiction, Mr. Speaker. Of course, it is a different committee. But my plan is to add that as another part of this to make sure that providers have another incentive, because it will save lives and reduce the cost of insurance. But to my question: Do you have any other thoughts on encouraging the doctors--and the doctors, bless them, are not necessarily always good business people, do not always get along with each other because they are very independent, and they are specialists. Do you have any additional ideas? Mr. Gingrich. Well, let me make three points about this. You have put your finger on a very key reason, and I think this is part of what Congresswoman Norton was saying when she was saying lots of people tell us where we need to go, but they don't necessarily tell us how to get there. And it is the how to get there sometimes that stops us, even when we are all in agreement. So I want to say three quick things. First of all, I want to go back to a line I started with. Paper kills. Any major purchaser who is allowing the system to continue to deal with the people that they care about with paper is risking the lives of those people. We know technically this is true, so I would start by saying any doctor or any hospital that is not migrating to health information technology is, in fact, saying that they are not seriously concerned about killing people. It is literally that direct. Second, the University of South Florida has a program they are developing that I would commend to you where, if you use the electronic health record, it includes an entire section on informed consent, and they designed this to meet your point, which is how do I get my doctors to think this is worth their while. And what they figured out was if they could design, working with both trial lawyers and defense attorneys, an ideal model of informed consent so that the doctor knew they had the minimum liability risk, the doctor would suddenly have a very direct interest in having that as part of their health record. And so I would strongly recommend the University of South Florida program as something you would want to look into. Third, you might have to add this on the floor because of committee jurisdiction again, but I just want to go back to what I said earlier both about Congressman Clay's bill, about the earlier work that was done by Congressman Murphy and Congressman Kennedy and by the very important bill introduced by Congresswoman Johnson and Congressman Deal, and that is, you should provide somewhere that providers, whether hospital or doctors, who are engaged in serving Federal employees ought to have Stark and anti-kickback waived for the purpose of allowing the hospitals to provide the electronic health records. This is an enormous savings for the system. It allows us to avoid the Federal Government getting in the middle of it, and our estimate is that you would have virtually 100 percent coverage of doctors. But if you added that provision in, I think you would find that most of the electronic health record problems would disappear within 2 or 3 years. Mr. Porter. Thank you. Congresswoman, questions? Ms. Norton. Thank you, Mr. Chairman, and thank you again, Mr. Speaker. I wanted to--I am reading your testimony. I wondered if we may be talking past each other. Maybe, because I haven't seen the wording of the bill, on page 16, the way the bill is worded, you indicate in your testimony on page 16 that--of course, the standards have to come from the industry. What in the hell do we know--excuse me. What in the world does OPM or anybody in Government know? You say, ``The data standards embedded into any personal health record through the FEHBP should be determined by health information technology experts, not health benefits experts.'' I have to assume that H.R. 4859, to which you refer, which gives responsibility on data standards for interoperability to OPM, simply means that the Government does not say that the private sector can do anything it wants to do without anybody on our side looking to see whether it basically conforms to status. You know, to use an analogy, the Government puts, you know, contracts out. One of the great--although this obviously is a huge contract, but I will give you what is more typical. It has a gazillion contracts out. Nobody monitors the contracts. And so, you know, you are on your own, contractors. Well, this, of course, is something very special, and somebody in Government--I am not sure who--would have to have some final say if FEHBP is involved over what those who have the expertise design as standards. So I wonder if this is even a matter of disagreement here, but the way in which you pose it in your testimony makes it look as though it may be. Mr. Gingrich. Well, let me say first of all, I may have not been clear, and I apologize to the gentlelady if I was not clear. I strongly believe that the Department of Health and Human Services, which is a Government agency, has a primary role in helping develop standards for interoperability in terms of health records nationwide. And Secretary Leavitt has organized an American Health Information Community, which has been meeting regularly, and I think Secretary Leavitt is moving in that direction. My only observation--I think it was conforming with what the chairman said in his opening remarks-- is I think OPM is better directed to follow the lead of HHS and allow HHS to be the primary standard setter for the whole country rather than to have a second electronic health record standard program being developed at OPM, which I think would be redundant and, frankly, not nearly technically as competent. But within that framework, you and I are on the same road. I am a Theodore Roosevelt Republican. Theodore Roosevelt decided, after reading Upton Sinclair's ``The Jungle,'' which has a scene in which a man falls in a vat and gets turned into sausage, which he supposed read shortly after breakfast, and he sent up the Food and Drug Act of 1903 as a consequence. I like the idea that any free market restaurant I go into anywhere in America has drinkable water. I like the Government guaranteeing that minimum. Now, they can compete on price and quality and food, but they have to get up to drinkable water before they get to play. They have to get up to edible food. So I agree with you. There are certain standards--and I mention in here, for example, I think the Government should make clear that electronic health records are ultimately the property of the patient. They are not the property of the insurance company. They are not the property of the doctor or the lab. They belong to the person about whom they are developed. It is a very important distinction from where we have been in the past. And so I agree, Congresswoman Norton, I think your point there is well taken. And my only observation was to not have redundancy between two Government agencies. Ms. Norton. We do not need to be regulators here. We need to just make sure the standards are what they say they are. On page 12 of your testimony, first of all, let me say I am pleased to see that you agree that the guinea pigs should all be willing. We are both enough of libertarians to understand that, that we do not want to get into new controversy when we are trying to get out of it with this--when we begin this. I would like your views, frankly, Mr. Speaker, on how this should be begun. I mean, I agree with you, here is a group of-- a rather closed group at that--people who use the same insurance companies and the rest. You know, it is a very large group, very varied group. They are a group of very high political and educational consciousness, and they all work for the Federal Government. If you wanted to begin with the Federal Government, have you given any thought to how you would approach the notion of getting employees of the Federal Government to be those who first cast out this notion with their own health care plans? Mr. Gingrich. Well, let me say first of all that I think if you look at what the Veterans Administration is experiencing, they will tell you that they are very, very excited and happy with the electronic system they have. They want to improve it and upgrade it, but they really do believe it has been a remarkable breakthrough, and it is a place where the Federal Government has been a real leader in creating the technology-- -- Ms. Norton. But those are the veterans, not the employees, I take it. Mr. Gingrich. Right. But I think everybody who works with it who is a Federal employee would tell you, they are for having that kind of record. They have seen the power of that kind of a record system. I think at TRICARE--and these are Federal employees--Defense Department employees are now going to have a, everyone eligible for TRICARE is going to end up with an electronic health record. That is happening. So in a sense, what you are doing is extending into the private sector and into the private market for the civilian Federal employees, something which is absolutely happening for the Defense Department, for those people who are eligible for TRICARE. Third---- Ms. Norton. But many of those are veterans and their families, right? Mr. Gingrich. That provides active duty military, reservists and retirees. Ms. Norton. They always can make you do what they want to do, but when you are dealing with a civilian work force where-- -- Mr. Gingrich. No. My only point is that these--again, I agree with your point. I would certainly be inclined at this stage to make it available, not make it mandatory. But I think because the Federal employee work force is actually a pretty smart work force, you are going to see an amazing number who say, ``Yes, I want that,'' particularly when they look at 83 percent reduction in medication error. I mean the Federal work force is not stupid. And they look at, OK, I can improve my chance of not getting the wrong medicine by 83 percent. I can improve my chance of managing my diabetes by 40 percent. I can improve my change of managing my cholesterol by 100 percent. I mean these are numbers from real studies in real medical facilities around the country. So I think you will see a very rapid migration in this direction. I would hope that looking at this hearing, and looking at conversations that I know that the Director of the Office of Health Information Technology at HHS, Dr. Brailer, has had with OPM, I would hope that when OPM issues their letter, I think April 15th or so, asking for next year's bids, that they will have provisions that are very parallel with this bill, that they will be following carefully the leadership of Chairman Porter and Congressman Clay in looking at how to make the--and I would certainly hope they will take your advice, Congresswoman, and do it in a positive way. My experience has been, when I talk to people in the consumer care area who are in the private sector, that somewhere between a third and 90 percent of the work force in blue collar factories choose electronic health records once they understand the option, and that it grows very rapidly as people talk to each other about why it is an advantage. Maybe I am too optimistic, but as you know, that has always been one of my weaknesses. But I am very happy to make it voluntarily initially, make it incentivized, encourage them to do it, and I think it will grow much faster than people expect. Ms. Norton. I couldn't agree with you more. I don't think you are being overly optimistic. I think you would have a confluence of the young people in the work force, and the older people in the Federal work force, for very different reasons, and if anything, you would have more people perhaps than any pilot of this kind could use. Finally, let me say that I very much agree with you that if we can find a way to deal in a bipartisan way, take the privacy matters, take the technology matters, and feel comfortable with them, that they--and Stark and anti-kickback laws removed or considerably reformed, would do exactly what you say they would do. From the point of view of the hospital, now having to communicate with physicians in ways that hark back to the early part of the 20th century, I do believe that the incentive for them would be greater than the incentive for us. So I thank you very much for all of the hard thinking you have done in this area. It is typical of you, Mr. Speaker. Mr. Porter. Mr. Clay. Mr. Clay. Thank you, Mr. Chairman. Let me echo too what my colleague has said. I appreciate Speaker Gingrich's efforts and leadership in a national health IT infrastructure, and helping to make that a reality. Let me ask you about the Federal Government. Since we administer the Medicare and Medicaid programs, what lessons can be learned by the entire health care industry in terms of improving the quality and efficiency of care provided to the general population? Are we becoming more effective in implementing programs that demonstrate positive results in both public and private health care settings? And you also mentioned to Delegate Norton that the VA has a model program as far as IT and electronic health records. Maybe you want to expound on that a little. Mr. Gingrich. That is a very good question. Let me say that probably the two largest pioneers at personal health records were the Veterans Administration and Kaiser Permanente. Both of them have very sophisticated systems. The VA system is now based on a relatively old software, and so is the Kaiser Permanent system, about a 15-year-old software. But there is no question that it has worked and that it has provided a dramatic improvement in quality of care. The biggest lesson I think you learn out of this is that when you can gather--two things happen--when you can gather data about individuals, you can provide them much better prevention, a much better chronic disease management, and they take better care of themselves because they know their status better, and the doctor can take care of them better. Second, when you gather enough data on a depersonalized level, you begin to see patterns. There is no accident that it was the electronic health record at Kaiser Permanente that first indicated Vioxx was a problem because they saw enough different records simultaneously electronically that their expert systems could say, wait a second, we have more people showing up with heart problems than should be. So you suddenly had them saying, wait a second, here is an early warning, that in a paper-based system might have taken 3 extra years. So it is the combination of more accurate information about you personally and a better ability to survey the whole system that really leads to these dramatic improvements. And I do think, as a conservative who is often very critical of Government, I do think you have to give the Veterans Administration a lot of credit for dramatic pioneering in an area that is very, very important. Mr. Clay. Are we in a position today to quickly detect and respond to major public health emergencies such as SARS and cases of bioterrorism, given the challenges that remain in health IT, and have the standards established through Dr. Brailer's office brought better response capabilities to those utilizing electronic health information systems and records? Mr. Gingrich. I am probably more adamant about this than almost anything we talk about, and I appreciate you asking the question. I believe, if you look at the disaster of Katrina, and the failure of the city of New Orleans and the failure of the State of Louisiana, and the failure of the U.S. Government, all three of which failed the people of that area--I say this as a graduate of Tulane and my younger daughter was born in New Orleans--I believe that there is no reason to believe that the Federal Government today, or the State and local governments today, are any better prepared for a major catastrophe of a biological nature, an avian flu pandemic or an engineered biological attack than they were prepared after Katrina. I think that people are kidding themselves. Every day that we don't have a 21st century virtual public health service that ties together 55,000 drug stores electronically, every veterinarian in the country, every dentist in the country, every nursing home in the country, every doctor, every hospital, and every retired doctor, nurse, pharmacist, veterinarian and dentist, because if you had a real crisis you would have to surge all of those assets in real time, and every day you failed people would die. Second, after you look at a 1,100,000 paper records--I spoke to the American College of Cardiology on Monday in Atlanta at their annual meeting. And they got a briefing about New Orleans. We lost 1,100,000 paper records in the Gulf Coast, 1,100,000. Now, somebody who is getting chemotherapy for their cancer suddenly had no records. And the fact that we are sitting here a half year later and do not have a Federal bill to create as a national security matter--remember, in 1955, President Eisenhower said we needed a National Defense Highway Act so we could build interstates so if we had a nuclear war people could evacuate the cities. It is a dual use system. Middle class people travel all over America. Trucks use it every day, but it was originally designed as a national defense matter. The fact that we do not have today a national defense health information infrastructure act, I think is an enormous mistake. And if we get unlucky, we will lose several million Americans for not having built the system. So I appreciate you asking me that question. Mr. Clay. Let me, just in closing, Mr. Chairman, out of curiosity, if we eliminate all of this paper, what kind of pushback do you think we will get from the paper mill industry and logging industry? [Laughter.] Mr. Gingrich. I have a number of friends in the paper industry, and I want to assure you that they are confident that the Government of the United States will find enough new ways to generate paper. [Laughter.] That none of them think they are going to become endangered by the elimination of medical records. But I appreciate your concern for them. Mr. Clay. Thank you, Mr. Speaker. Mr. Porter. Thank you. Mr. Cummings, do you have any comments or questions? Mr. Cummings. First of all, good afternoon, Mr. Speaker, good seeing you again. I was just listening to you talk about Katrina, and I thought about the will to do something like this, the will to do this. You talk about the highways. It sounds like this is a good start to do something that is very positive, but I think what happens--and maybe you can help me with this--is do you think the Congress does not have the will to do these make-sense kinds of things that--I mean when we look at Katrina and we see how bad off our emergency systems were and are, when we consider September 11th and I guess we all pretty much assumed that we were in a better position than we were on September 11th, and we really don't see much improvement since September 11th. And this is in no way knocking Republicans or Democrats. I am just throwing this out as a general concept. It just seems to me that we--somebody told me, I will never forget, when I first ran for office, he says--I was down like 15 or 20 points within 3 weeks of the election, and this guy told me, he said, ``Look, I'm not the campaign manager.'' He says, ``Most people know what to do to win, but they don't have the will to do it, and they don't do it.'' I think we know what we need to do, the things we need to do, but it just seems like there is so much going on that distract us--just like we were able to build a highway system, probably some folks said full sped ahead, and got it done. I am wondering, you know, how much faith do you have even if we put something like this on the books, that it would happen? Mr. Gingrich. Let me say first of all, I appreciate that question more than you can imagine. I think it is very thoughtful and I think it captures the great difficulty that I had the 20 years I was serving actively. I think every Government class in the country ought to read what you just said, because you just captured the dilemma of the American system. Let me break it into a couple parts. First of all, the Founding Fathers wanted to avoid dictatorship, and so they consciously designed a machine so inefficient that no dictator could force it to work. [Laughter.] They did such a brilliant job we can barely get it to work voluntarily, and they would look down and say, ``That is exactly right.'' This is part of--days when I am about to go crazy, I just laugh and remind myself, Washington and Franklin and Madison and all those guys are really happy because this is really hard. Second, we are at one of the great turning points in American history, and you nailed it just now. And I would immodestly suggest if you go to my personal Web site, Newt.org, there are two papers there. One is on 21st century entrepreneurial public management, and the other is on transforming the legislative branch. The point I make there is exactly your point at a core level. The system is broken. I describe it as that we have inherited this box, and this box is an 1880 male clerk sitting on a wooden stool with a quill pen and an open ink well. That is the Civil Service Act. It is 125- years-old. Modified by a 1935 New Deal bureaucracy, where you use a manual typewriter with carbon paper. I was telling the administration just last summer--because I developed this model originally looking at Iraq and the global war on terror, and I was going around before Katrina saying, ``We are going to have a catastrophe,'' because this box doesn't work. I would say to you, if you look at FEMA's total failure, you look at the current SBA problems, and you look at the Corps of Engineers, the fact that the Congress is not doing aggressive oversight--and let me say this as a Republican--I don't care if we have a Republican President, our Constitution is designed to have very aggressive oversight by the legislative branch because it is the only way the system works, just as, by the way, I think the President should occasionally veto things because it is the only way you retain balance. The system is designed for this conflict. But you all should be right now taking apart FEMA and rebuilding it. You should be taking apart the Small Business Administration and rebuilding it. You should be taking apart the Corps of Engineers and rebuilding it, because, I mean, how much more evidence do you need than the last 6 months? So I think you and I are close together. What I am intrigued with is these things take time. Remember, I cited the Eisenhower 1955 proposal for an interstate highway system. Eisenhower wrote a book called ``At Ease: Stories I Tell My Friends,'' and in one of the stories he had in that book, he said in 1919 he led the Army's first transcontinental truck expedition. And he remembers sitting on--actually in your State, Congressman Porter--he remembered sitting under the stars in Nevada, having crossed a stream, imagining to himself what it would be like to have highways that connected the whole country. 36 years later, as President, he proposed that system. These things sometimes take time. I am up here, cheerfully optimistic, because I think with your leadership we are going to get electronic health records for Federal employees, and that is going to be a major break in the system. And by the way, by the time you take care of the hospitals and doctors and take care of Federal employees, you just took care of 50 percent of the doctors and hospitals in the country, and from the standpoint that legitimately I would hope a number of you have for the disparities and outcomes, you get to an electronic health record--and we worked very closely with Morehouse Medical School and Dr. David Sacher, Dr. Elizabeth Ofili on this. We are going to dramatically reduce the disparities and outcomes if we have electronic health records. I mean these are a big breakthrough. So what you are doing may be a building block toward a dramatically bigger future, but that was a great question and a great observation, and you put your finger on a big deal. I will say one last thing. I had a great honor yesterday. The State of Florida, the House of Representatives down there-- they only have a 9-week session--they took an entire day off to have a workshop for all their members on transforming health in Florida, and it was very interesting how they did it. It was a very powerful moment of everybody stopping, you know, no packed fundraiser, no running off to constituents, no 205 other assignments. And we had a ton of members of the Florida Legislature deeply engaged in learning and talking and thinking. It was a very encouraging moment. Mr. Cummings. Thank you. Mr. Porter. Mr. Van Hollen. Mr. Van Hollen. Thank you, Mr. Chairman. First, let me thank you, Mr. Chairman, for introducing this piece of legislation because I do think it is a very important conversation to start. The conversation has begun, but this is an example of something we can maybe move forward on as an example from the Federal Government. As I told you yesterday, I think using the Federal program to begin to push others in the country in the right direction is a good idea, and, obviously, the details need to be worked out and there are a lot of important details to be worked out. Let me also thank you, Mr. Gingrich, for your many ideas you have had in the area of health care recently. I don't always agree with every one, but I have to tell you, the more ideas that are churning out there, the better off we will be as a Nation, because I think this is an area, as I know you have said, where we can have dramatic improvements going forward. I agree that Congress needs to be more aggressive in its oversight in a whole range of areas, and I think the question of competence is something that the American people are going to come to value even more highly than they already do, and as a Government, whether it is Republican or Democrat, we owe them a higher degree of competence than we have seen in many recent instances. Let me ask you, with respect to just some of the--and I don't know if you have had an opportunity to look at the details of the bill--but one of the issues is whether or not you are going to allow people to voluntarily opt into this system, or whether you are going to set it up so they are required to automatically be enrolled, and given the fact that the Federal Government is launching an experiment in this area, and the fact that a lot of people are concerned about the privacy implications of electronic records, do you have a view on that question? Mr. Gingrich. I was earlier associating myself with Congresswoman Norton's position because--and I say this at a practical level--if we try to impose, and we arouse all the privacy advocates and we arouse all of the Federal employee unions, that will slow this bill down so much, that if we can get it to be voluntary in Phase I, I think we will actually have more people signed up in the length of time it would take to fight the bill through if you have a lot of opposition. So I would rather make it a voluntary system. I did suggest the incentive of saying to the plans we would pay slightly more in the 3rd, 4th and 5th year if it is an electronic record and slightly less if it is a paper record, and that would incentivize the plans to encourage people to join. But I think you are going to get--if you look at e- ticketing nowadays at airports, you know, Americans aren't stupid. As Americans learn--and I said it earlier, examples of 83 and 85 percent reduction in medication error, that saves your life; 40 percent improvement in diabetes management, that saves your life; 100 percent improvement in cholesterol management. These are case studies in places that have used these records. Federal employees are smarter. They are a very smart group collectively, as you know, and I think they will talk to each other. Within 3 or 4 years it will be in the high 90's. And I think, frankly, if the last 3 percent would rather have paper and risk dying, that is their prerogative as a free people. Mr. Van Hollen. Thank you. I think you are right. I think the amount of resistance you are going to get is not worth the effort, and I think that people will see this as a good thing and voluntarily do it. We don't have a lot of time. What is going on--and I apologize, Mr. Chairman for being late. We had a briefing in the Judiciary Committee. But in the private sector, to what extent is there movement? How rapid is the movement in this area, and where do you predict that going, and how important do you think it is to move forward in this area in order to get the rest of the market to move? Mr. Gingrich. You are asking the right question. First of all, there is enormous movement in this area. There is a tremendous new program at the University of South Florida, which I was just getting briefed on yesterday in Tallahassee. There is a big project by Humana and Blue CrossBlue Shield of Florida called Availity, which will cover a third of the people of Florida, and if they had Medicaid will be over half the people of Florida. Kaiser Permanente has 13 million health records nationwide that are electronic. The Veterans Administration has about 13 million health records that are electronic. As you go around the country, Peace Health in Oregon, Washington State and Alaska, has about 1,400,000 health records that are electronic. So as you go around the country you just see the momentum beginning to build in that direction. One of the things I am passionate about is modifying Stark and anti-kickback so that hospitals can provide free health information technology equipment to doctors they are legally barred today from doing. They can't even provide it to each other. So, for example, the largest hospital in western Michigan would probably provide health information technology to all the small rural hospitals in the upper peninsula, but it is currently illegal under Stark and anti-kickback. Well, that is utterly irrational. The Federal Government, unfortunately, is not going to pay for it. As a national security matter I would have the Feds pay for it and get it done in 2 years. If they are not going to pay for it, the easiest source of sophisticated capital is the hospitals. They actually save enough money, if patients are transferring in electronically rather than in paper, they save a lot of money on unnecessary labs that don't need to be taken. So I would encourage you to look at that as a major component of this. Mr. Porter. Thank you very much. Mr. Speaker, we appreciate you being here. Once again, it was an honor to have you here. We look forward to working with you. Thank you. Mr. Gingrich. Thank you. Mr. Porter. In the element of time I am going to combine actually the second and third panel, so if both panels will come forward, please, we will have a chance to get the table set up. We will start with Mr. David Powner, who is Director of Information Technology Management Issues, Government Accountability Office. We will then have Dr. Jane Barlow, Well- being Director, Health Benefits Operations with IBM; then have Mr. David St. Clair, founder and CEO of MEDecision, Inc. Dr. Edward Ewen, Jr. was going to be with us, but had to take care of a patient. Dr. Paul Handel will be next, who is vice president and chief medical officer, Texas Division, HCSC; Jeannine Rivet, executive vice president of United Health Group and then Dr. Malik Hasan, who is CEO, Health View, retired CEO of Health Net. So we will start with Mr. Powner. STATEMENTS OF DAVID A. POWNER, DIRECTOR, INFORMATION TECHNOLOGY MANAGEMENT ISSUES, U.S. GOVERNMENT ACCOUNTABILITY OFFICE; JANE F. BARLOW, M.D., MPH, MBA, IBM WELL-BEING DIRECTOR, GLOBAL WELL-BEING SERVICES AND HEALTH BENEFITS, THE IBM CORP.; DAVID ST. CLAIR, FOUNDER AND CHIEF EXECUTIVE OFFICER, MEDECISION, INC.; PAUL B. HANDEL, M.D., VICE PRESIDENT AND CHIEF MEDICAL DIRECTOR, BLUE CROSS BLUE SHIELD OF TEXAS (A DIVISION OF HEALTH CARE SERVICE CORP.); JEANNINE M. RIVET, EXECUTIVE VICE PRESIDENT, UNITEDHEALTH GROUP; AND MALIK M. HASAN, M.D., CHIEF EXECUTIVE OFFICER, HEALTHVIEW, RETIRED CHIEF EXECUTIVE OFFICER, HEALTH NET STATEMENT OF DAVID A. POWNER Mr. Powner. Chairman Porter and members of the subcommittee, we appreciate the opportunity to testify on health care information technology. As we have highlighted in several recent reports completed for Chairman Davis of the full committee, significant opportunities exist to use technology to improve the delivery of care, reduce administrative costs, and to improve our Nation's ability to respond to public health emergencies. This afternoon I will briefly describe the importance of information technology to the health care industry, discuss key Federal leadership efforts to bolster the adoption of IT, and highlight key aspects of your proposed legislation, Mr. Chairman, that are critical to achieve the President's goal of a nationwide implementation of interoperable health care systems. Information technology can lead to many benefits in the health care industry that we have reported on over the past several years. For example, using bar code technologies and wireless scanners to verify the identities of patients and their correct medications can and has reduced medical errors. In addition, surveillance systems can facilitate the timely collection and analysis of disease-related information to better respond to public health emergencies. Its standards- driven electronic health records have the potential to provide complete and consistent medical information necessary for optimal care. Just last month, the Select Committee that investigated Hurricane Katrina concluded that the lack of electronic health records contributed to difficulties and delays in medical treatments to evacuees. Fortunately, several efforts led to the development of a Web-based portal to access prescription information for these evacuees. This highlights the importance of electronic records with even limited information, which was made possible when commercial pharmacies, health insurance programs and others made accessible key prescription data. Several major Federal health care programs, including Medicare, Medicaid and OPM's Federal Employees Health Benefits Program provide health care services to over 100 million Americans. Given the Federal Government's influence over this industry, Federal leadership can lead to significant change, including the adoption of IT. Given this, in April 2004, President Bush called for the widespread adoption of interoperable electronic health records within 10 years, and established the position of the National Coordinator for Health IT. Although the coordinator has issued a framework, established working groups of industry experts and awarded contracts to define a future direction, we have testified and recommended that the National Coordinator: one, establish detailed plans and milestones to carry out the President's call for interoperable health care records; two, complete detailed plans with private sector input for defining standards to enable interoperability of data and systems; and three, to fully leverage the Federal Government as a purchaser and provider of health care. Turning to your proposed legislation, Mr. Chairman, I would like to commend your action to leverage the Office of Personnel Management as one of the largest purchasers of electronic health benefits to advance the creation of electronic health records. The Federal Employees Health Benefits Program has over 8 million beneficiaries and advancing electronic health records to this critical mass would be significant. Your focus on electronic health records is critical since they are a central component of an integrated health information system. In addition, they have the potential to reduce duplicative tests and treatments, and could lead to reductions in medical errors. Another key aspect of your proposed legislation, Mr. Chairman, is its focus on adopting standards that are consistent with the National Coordinator's efforts. IT standards are critical to enable interoperability of data and systems, and it will be especially important if carrier-based records are to be interoperable with provider-based information. We remain concerned about the development of such standards and highlighted these concerns before Chairman Davis at a full committee hearing last fall. Although the identification of standards continues to be one of the major focus areas for the National Coordinator, to date, the standard-setting processes have resulted in conflicting and incomplete standards, and the consensus on the definition and use of standards remains a work in progress. Hopefully, the standard-setting initiatives will gain momentum in the near future so that provisions of your bill calling for these standards can be carried out. In summary, Mr. Chairman, efforts like your proposed legislation that provide tangible solutions to jump start adoption rates of electronic health records, and that leverage Federal programs and resources are critical to carrying out the President's goal. This concludes my statement. Thank you, Mr. Chairman, for your leadership in driving this much-needed technology. [The prepared statement of Mr. Powner follows:] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] Mr. Porter. Thank you very much. For those who are here for the first time at a congressional hearing, understand that Members will come and go for different committee hearings happening at the same time. We may even be called to vote on the floor here at some point. But know that your testimony is very valuable and is a part of the record being scrutinized by a lot of folks. So we appreciate you being here. The number of people here today is not a reflection of the importance of this issue. It is just the process with multiple committees happening at the same time. Dr. Barlow, welcome. STATEMENT OF JANE F. BARLOW, M.D. Dr. Barlow. My name is Jane Barlow. As well as being Director for IBM's Health Benefits Operations, I am responsible for the delivery of $1.7 billion in health care to over 500,000 IBM beneficiaries in the United States each year. I appreciate the opportunity to testify on behalf of IBM in support of this important legislation. IBM's strategy in health benefits is simple. We focus on health people for high performance. This strategy underscores investment in health to realize the productivity and innovative potential of our employees. The personal health record is critical to achieving this goal. In 2005, IBM announced that it would provide personal health records to its entire U.S. work force. To set up the records, employees enter information in a secure Web site. They input such things as medical conditions, family history, medications and allergies. Later this year, their personal health record will automatically import their medical and prescription drugs claims history. The ultimate goal is to enable all types of health information to flow into the record to form a comprehensive portable portrait that the patient can access when they desire and share with their provider when they choose. Since we rolled out personal health records late last year, over 45,000 IBM employees have signed up. It is important to note we are not creating new information. The carriers have always collected claims data. It is how they pay bills. But the personal health record will allow our employees to look at their comprehensive claims history, many for the first time. I believe electronic health records will drive two changes in health care. First, they will increasingly make health care organize around the patient; and second, electronic health records and their related systems will improve our employees' interaction with their doctor. Let me explain. The personal health record empowers consumers with the information they need to actively manage their health and health care. As a result of the personal health record, our employees are asking more questions about cost and quality. With this broader personal health history, they are able to have a collaborative relationship with their physician that extends beyond the day's illness to address the most important health needs for that individual. This informed relationship with their provider is critical to improving health care quality and reducing costs. With the aid of electronic health records and the tools to support them, providers will have all the information about a patient and can focus on the most important health issues for that patient across the continuum of care. Let me give you an example of feedback I received from a happy employee. This employee reported suffering depression for most of her adult life. As a result of participating in our disease management program, she was able for the first time, to work with a provider who had a comprehensive view of her medical history and other personal factors. They were able to identify a successful treatment plan for her, and she reported that this had totally changed her life, and for the first time in 18 years she felt fully alive and productive. My hope is that the personal health record will afford this opportunity for every patient. Provider adoption of personal health records is key. While the legislation establishes some incentives, reforms and reimbursement and additional sources of funding will have a dramatic impact on the adoption and value of the electronic health records created by the act. Finally, this bill will help lead the critical transition to digital health care by allowing the exchange of health information in standard electronic formats. IBM strongly supports the use of standards. We believe standards are critical and necessary to ensure providers and patients have the information they need. In summary, personal health records will drive a more innovative and efficient patient-centric system. Personal health records are the foundation of a standardized infrastructure for the electronic exchange of health care information, one that enhances the ability of providers to deliver high-quality care. Finally, improving the health and wellness of a work force, whether at IBM or across the Federal Government, is a strategic investment that can pay substantial dividends, promoting greater economic competitiveness and capacity to innovate. Thank you. [The prepared statement of Dr. Barlow follows:] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] Mr. Porter. Thank you, Dr. Barlow. Next we will have Mr. St. Clair, founder and CEO of MEDecisions. STATEMENT OF DAVID ST. CLAIR Mr. St. Clair. Good afternoon, Mr. Chairman. Thank you for inviting me to testify before this subcommittee today on what we consider to be a very important topic. As you said, I am David St. Clair, Founder and CEO of MEDecision. We are the recognized market leader in collaborative care management solutions for the health care industry. Our clinical systems are used nationwide to help coordinate care for about one in every six insured people in this country, including millions of Federal employees and their families. I am here today representing two other organizations as well. I am here on behalf of HIMSS, the largest trade association for health information technology, and I am here as the spokesman for the CollaboraCare Consortium, an alliance of 16 innovators in the emerging regional health information market. We believe that electronic health records will really improve the way health care is delivered in this country. Using technology to facilitate collaboration among health care stakeholders will result in the right information reaching the right people at the right time, which can improve lives, indeed, save lives, and make health care more affordable in the process. We need not wait until physicians and other providers fully embrace the use of electronic medical record systems in their practices. Sharing information that already exists within payer repositories, with individuals and their care team can improve health care outcomes. For these reasons, MEDecision, HIMSS and the CollaboraCare Consortium, enthusiastically endorse the Federal Family Health Information Technology Act of 2006. There are just a few points I would like to emphasize in my testimony today, and as you will hear, many of them really speak to the notion that of the things that are called for in the proposed legislation are already well under way in the private sector. My first point is, our success at creating and deploying carrier based health records, which we call the payer-based health record [PBHR], has already demonstrated the value of those records at the point of care. In his written testimony, Dr. Ed Ewen, a practicing physician with the Christiana Care Health System in Delaware, and their head of Clinical Informatics, underlines his belief that the information in the Blue Cross Blue Shield of Delaware PBHRs, being used in the Christiana Care Level 1 Trauma Center, has, one, improved the quality of care being delivered to patients in need. For instance, they found that the PBHR gave them substantially more--their quotes--medication information 48 percent of the time than they had through any other means. And two, that effort has decreased the cost of that higher quality care. The key to understanding the value of carrier-based health records is illustrated in the graph on my left. We have laid out the population. This data is from the 3.7 million health records we created last month for the Blue Cross Blue Shield of Illinois population. We have laid them out based on their relative burden of illness. As you can see on the left, the sickest 5 percent of the population, which represents, by the way, over 40 percent of the total health care spent for this population, have, on average, 11 different medical conditions, including three chronic care conditions, and those individuals have taken 13 different classes of medications and seen 9 different providers of care within the past year. This population, more than any other, is in need of assistance in bridging the information gaps or the information chasms evident in the medical community today. Just one of these patients generates raw claims data that fills 60 pages that I have in my hand here today. What we have as a technology challenge and clinical challenge is to reduce that to the four- page summary that we are using today in the State of Delaware, and soon in the State of Illinois. My second point, the technology we use have been creating valuable information from payer data for over 10 years. In 2001 we started using the PBHR to support case and disease managers as they worked with those individuals with the chronic diseases. For instance, Blue Cross Blue Shield of Massachusetts uses the payer based health record to drive their disease management programs both through telephone contact and tailored correspondence. Third, if you direct your attention to the second graphic here, our belief, since I started the company 18 years ago, is that we need to be able to share a composite view of a patient's history with all members of the care team, the patient themselves to help with their own decisionmaking, with the clinical staff who are actually treating the patient, and with the care managers, the case managers and disease managers who are helping coordinate their care. While there will still be decisions to make and perhaps disagreements, at least we are all starting with the same basic information. Fourth, last year, in anticipation of the destruction of Hurricane Katrina, we partnered with Blue Cross Blue Shield of Texas, and created 830,000 payer-based health records for the potential evacuees along the Texas Gulf Coast in 4 days. When Rita stormed ashore, Blue Cross Blue Shield of Texas was ready. This year we have created 3.7 million payer-based health records for the membership of Blue Cross Blue Shield of Illinois in 4 weeks. We will be extending that capability across the populations for Blue Cross Blue Shield of Texas, New Mexico and Oklahoma, all for their parent company, Health Care Services Corp. We and the physician executives of HCSC--and you will be hearing from Dr. Handel in a few minutes--will be working with the provider communities and consumer advocates to roll out secure access to these records by the members and by the physicians who treat them. Our success with the project in Delaware we replicated on a much broader scale with 10 million records available nationally. I want to point out that represents 3.3 percent of the U.S. population who will have electronic records available from one payer in 1 year. Finally, that brings me to the last point, access and cost. The PBHR, whether enhanced by PHR data or not, will improve the quality and safety of health care for virtually everyone who participates. We strictly adhere to HIPAA privacy and security regulations and allow individuals to opt out of the program if they have privacy concerns. In addition, we implement data filters that respect State law, prohibiting the sharing of certain classes of information. The key for adding a voluntary PHR--and we have five such partners in the CollaboraCare Consortium--is it will allow consumers who wish to share all their data, some of their data, or none of their data to control that process at a granular level. The technology and delivery infrastructure is very inexpensive when used across a broad population. Based on our experience in Delaware, we would project that the PBHR and PHR programs being called for in the legislation will cost well under $1 per member per month for that coverage, which represents a very small fraction of the monthly premium for those particular individuals. Thank you very much for the opportunity to testify before the subcommittee today. I am prepared to take any questions you may have. [The prepared statement of Mr. St. Clair follows:] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] Mr. Porter. Thank you very much. Next we have Dr. Paul Handel, who is the vice president and chief medical officer Texas Division, HCSC. Welcome. STATEMENT OF PAUL B. HANDEL, M.D. Dr. Handel. Chairman Porter, thank you very much for inviting Health Care Service Corp. to submit formal testimony on the electronic health record. I am Paul Handel. I am a doctor with approximately 40 years of clinical experience in caring for and caring about patients. At the present time I am vice president and chief medical officer, Blue CrossBlue Shield of Texas, a division of Health Care Service Corp. My testimony today will reflect the position of Health Care Service Corp. I am not representing the Blue Cross Blue Shield system in any fashion. HCSC is a non-investor owned company that operates through four divisions in Illinois, Texas, New Mexico and Oklahoma. We cover approximately 10 million lives, and we are now the fourth largest carrier in the country. We firmly believe that electronic health records can benefit health care in the United States by increasing the accessibility to quality care and making health care more affordable. The record, the electronic health record, as your own experience that you related about your mom, and David talked about a few moments ago, really looks toward our elderly population and the sickest part of our population, which consumes the vast majority of our health care resources. These people are invariably unable to give concise histories because of either age, underlying conditions or perhaps even their medications. They also have a team of physicians that are caring for them. They have multiple ancillary providers that are involved, and their histories become relatively unclear. Without a question, collating the data for these people will be instrumental in improving their health care. Additionally, the connectivity that we are envisioning here will facilitate the education and the provision of preventive services to all of our population, and, candidly, in the big picture, that will address what I think is a graver, much larger issue, and that is the spiraling increase in our health care costs. We have a large data base of electronic information. We realize the value this data has on the development of electronic health records, and for our own members in particular. We have already begun to focus on providing claim- based personal health records to our members because we believe it is an extremely effective way to positively impact their outcomes. I want to emphasize that we are just now beginning to learn what information is useful, and how do we educate consumers, physicians and other providers as to the value of the electronic health records. The flexibility to continue to innovate is absolutely imperative. We have heard a fair amount of discussion today from everyone concerning Katrina. I can tell you that in Texas, we lived through over 300,000 people coming to Texas as refugees without any health care information. Most of them could tell their doctors they were taking a blue pill, a yellow pill, they had received treatment for cancer, but they didn't know what drugs they were taking. It was a real debacle. As we prepared for Rita, we prepared within 4 days time, from a Thursday morning to Monday morning, patient clinical summaries on 830,000 patients across the Gulf Coast, and into western Louisiana. We partnered with the Texas Medical Association, and on Monday morning, 4 days after starting our efforts, we were able to put forth an 800 number by either e- mail or blast fax to over 40,000 Texas doctors, a contact point where they could get the patient clinical summaries if anybody had been displaced and showed up in their practices. Our success in creating the electronic plan-related health records for the hurricane victims really pushed us forward to roll out our records to all of our members in HCSC. We will start the program in Illinois with approximately 3.7 million members, and continue to roll that out through the remaining divisions over the course of the year. The core reason why we began to implement a health record like this for our members is that we will not consider saving money or reducing medical errors, but on a higher level, to ultimately improve the accessibility to quality and affordable health care for all, and parenthetically, in the process, we will probably save money and reduce medical errors. In conclusion, I would like to stress the importance of allowing health plans to continue to create innovative products with the flexibility to make changes that meet local customer needs and market demands. We agree with the need to utilize technology to establish uniform standards for health data, facilitating interoperability, efficiency of communication and safety. We believe that implementing a payer-based health record is the right thing to do. We will continue to pilot projects for developing various means of electronic transmission of plan-related health information in this way. We feel that other carriers will find the most successful features to create value and usage for the personal health records. Thank you very much. [The prepared statement of Dr. Handel follows:] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] Mr. Porter. Thank you very much, doctor. Next is Jeannine Rivet. I hope I pronounced your name right. Executive vice president, UnitedHealth Group. Welcome. STATEMENT OF JEANNINE M. RIVET Ms. Rivet. Good afternoon, Chairman Porter. I appreciate the opportunity to share with you our experiences in offering personal health records to the consumers that we serve. I am Jeannine Rivet, executive vice president of the UnitedHealth Group, a diversified health and well-being company, dedicated to helping people achieve improved health and well-being through all stages of their lives. UnitedHealth Group's family of businesses offers a broad spectrum of products and services to approximately 65 million individuals nationwide, everything from commercial health plans to Medicare offerings such as Part D drug plans, Medigap, Medicare Advantage Plans, Medicaid services, health analytics and informatics, and specialty solutions such as nurse triage services, centers of excellence, dental, vision plans and behavioral coverage. To our UnitedHealth business we also offer health benefits to Federal employees and annuitants under the Federal Employees Health Benefits program, 14 States and the District of Columbia with more than 322,000 members enrolled in our various plans. At UnitedHealth Group we have invested heavily in technology as part of our efforts to advance the quality of care provided to individuals and to improve the efficiency of our health care system. Our investment in technology allows us to provide our plan members with comprehensive information about the cost and effectiveness of different treatment options, as well as to help them find the highest quality providers. This type of information, we believe, is critical to improving outcomes and to enabling consumers to maximize the value they receive for their health care dollar, and to more easily manage their health care. One of the primary ways we provide this type of information to our members is through our consumer Web site, myuhc.com. Members can log onto UnitedHealth's Web site and find top- performing providers who meet objective quality and efficiency criteria, or find information on hospital quality for more than 150 procedures. They can order prescription refills and they can compare the cost of drug alternatives, and receive monthly statements providing explanation of benefits for all services. Last spring, we expanded our Web site capabilities by integrating a personal health record that gives consumers greater access to and control over their health care data so that they can make informed decisions. Through myuhc.com, which is a secure Web site that protects the privacy and security of members' data with user names and passwords, our members can use their personal health record to view their full history based on claims data, store information on their medical histories, as well as contacts with health care practitioners and upcoming appointments, receive condition specific alerts and appointment reminders, enter and track clinical data such as glucose levels and blood pressures, as well as their own information and lifestyle behaviors such as weight and sleep habits, and they can enter notes, reminders and personal observations. In addition, members have the option of giving their physicians and family members access to their personal health records including access to their personal health summary, which is a printable health summary, detailing the most recent conditions, medications, procedures and lab results, which is viewable online or through swipe card technology. Currently, about 4\1/2\ million consumers have access to a personal health record through our Web portal. We too have a Hurricane Katrina example regarding the impact and positive results from having a personal health record. Within the greater New Orleans area we were a critical resource to our members. They use their personal health records to reestablish health care records including medical, lab, pharmacy and immunization records with their physicians' offices since many of the physicians were dislocated, or their offices were flooded and the data was lost. As part of our effort to design a responsive personal health record, we conducted a number of in-depth telephone interviews and focus group sessions with consumers, physicians and employers. We gathered some very helpful information through these efforts. Some common themes were: accessibility, portability and convenience are key benefits of a personal health record. Primary concerns, not surprisingly and already noted, were Internet security, privacy and accuracy of data. And everyone felt that the personal health record would enable the patient-physician interactions. Consumers had a very positive response to the concept and were open to using personal health records. Physician awareness was mixed. Once the personal health record concept was explained, physicians responded favorably. However, noted concerns regarding the cost of the personal health record and the possibility that patients may be able to block out information from the health care provider. Their concerns over the cost of personal health records verified the need for incentives for adoptions such as the one, Chairman Porter, that your bill contains. Employers have limited awareness or experience with a personal health record. However, again, once explained they saw value, primarily for their employees, but less value for themselves as the employer. And all consistently recognized the need for further education on ease of use, benefits, security and confidentiality. Based on our experience and research, we continue to refine our direction, focusing on enhancing the consumer position relationship. Also we have identified a number of requirements for facilitating widespread adoption that you may wish to consider as you move forward with your efforts to expand use of personal health records in the FEHB program. Most important, a strong and consistent information and education campaign that clearly shows the value of using a personal health record, as Ms. Norton referenced earlier. Also a tailored consider experience, which is organizing data and features in a manner that makes it easy to navigate and access information of choice, with health information displayed and described in ways that are easy to understand. Secure and private infrastructures and processes are critical. Accurate and timely information will build trust and credibility. Flexibility is needed to address consumer needs, preferences and desires. Fully integrated records to create easy access for the individual. And we agree with you, Chairman Porter, interoperability with provider office technology is necessary. In closing, let me say that at UnitedHealth Group we are confident that the use of appropriately designed personal and electronic health records will make a significant difference in improving health outcomes for individuals, and will make it easier for them to manage their health care effectively. That is why we have invested considerable time and resources. Chairman Porter, we appreciate your leadership on this very important matter, and thank you for the opportunity to share our experiences with you today, and I would also be happy to answer any questions you may have for me. [The prepared statement of Ms. Rivet follows:] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] Mr. Porter. And we thank you for being here. We appreciate it. Next, Dr. Malik Hasan, CEO of HealthView, and retired CEO of HealthNet. Welcome. STATEMENT OF MALIK HASAN Dr. Hasan. Thank you, Mr. Chairman, and let me thank you on two counts: first, for allowing me to present my view; and, second, I am also your constituent and voted for you. [Laughter.] And it seems like I voted right. I am very happy with my vote. Mr. Porter. I may ask you to say that again someday, so don't forget that, OK? Thank you. Dr. Hasan. As you will notice from my bio, I have had a very diverse experience in the delivery of health care in the United States. I have firsthand observed the flow of information and the current limitations in physician offices-- because I used to run a physician office--hospitals, because I was involved in the operation of a hospital, also the free- standing facilities, and was the founder and operator of a major health plan. The experiences allowed me to observe the gaps in care. Such gaps result in poor coordination of care with the resultant poor and expensive care. Resources are very poorly utilized. The introduction of the electronic health record, as envisaged in this bill, will start bridging those gaps and commence the transformation of the health care delivery system which is sorely needed, because it is not just the Federal employees. Once the carrier starts a process for Federal employees, they will also extend it to their other employee groups and other members, thus starting a snowballing effect. The features of the electronic health record as described in this bill are essential to achieve the goals which are envisioned in this bill. The bill allows the creation of a longitudinal record, starting with the carrier's input and entries by the consumer and additional information imported from the provider's EMR, thus providing ultimately a very complete medical record which is important for the continuing care of the patient. This will also provide prompt and accurate access to a medical record in an electronic format to the patients and, more importantly, also the providers who are not familiar with the patients, with better understanding of the problems and their management. This electronic record provides a record which, as I mentioned above before, is going to be very important for the continuing care of the patient. In addition, the integration of the SNOMED--and this alphabet soup stands for Systematized Nomenclature for Medical--I am blocking on the full name. But it is in my written testimony--allows the information to be encoded as opposed to being just text. And it allows for its proper arrangement and organization within the record. It also enhances the privacy feature because the information is encoded. You can basically rifle-shoot which information should be available to whom as determined by the patient, rather than giving full access to the record. The encoding of data through SNOMED is described more fully in attachment two. It will take too much time for me to go over that here. It would in the future also allow outcome measurements leading to standards for evidence-based practice of medicine, population-based studies, profiling the providers, and making it much easier and cheaper to conduct drug trials. One of the problems with the drug trials is that the FDA considers that anytime they are going to approve something, it is going to be in the public domain and, so to speak, can be withdrawn, nobody is going to look at it. On an electronic record, you can survey, keep on the surveillance, and pull out the medicine as soon as some red flag arises. SNOMED also allows the patient to have full control over the records and fully protect the privacy. So far, any attempts at reforming health care have invariably centered around the reform of health care financing rather than addressing the root causes of poor and expensive care. This legislation is a joint step toward elimination of the barriers to the high-quality, cost-effective care. We are fortunate to have the finest physicians and hospitals, but this advantage is compromised because of a lack of electronic health record. The absence of an electronic health record creates an environment that prevents proper coordination of care, allows ignorant care, and even worse, inappropriate care, which is duplicative, wasteful, and allows serious errors. This legislation will go a long way in eliminating all those sins of commission and sins of omission. Thank you, Mr. Chairman, and I am prepared to answer any questions. [The prepared statement of Dr. Hasan follows:] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [The prepared statement of Dr. Ewen follows:] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] [GRAPHIC] [TIFF OMITTED] Mr. Porter. Actually, you are all going to be lucky because we are going to be called to vote here shortly, so there is not time for a whole lot of questions. But we are going to be giving you questions, if you could submit within 5 days some of the responses. I want to make a comment, and then I am going to ask a question. I met with a veteran the other day, and I know we have talked about the Veterans Administration here really at length today. He is probably in his mid to late seventies, and he actually was here with the Veterans of Foreign War, as they traditionally come this time of year to talk about veterans issues. And one of his colleagues was a doctor, and I just happened to mention this bill that we are talking about today. And the gentleman that I am referring to that was in his late seventies, he had a huge smile on his face. And he said, ``You know, I am now receiving care through the Veterans Administration,'' and he started bragging about the personal health record. He went on and on and on, on how he could communicate with his doctor, he could read it, he knew exactly--and as Speaker Gingrich said, he had ownership. It was a tremendous example of what I am hoping every American will be able to have to take advantage, hopefully with this bill's passage, moving it along much faster than originally envisioned. But having said that, I wanted to share that with all of you, that this is a real person, a real veteran with real health problems, that is just so excited to break down these barriers and have ownership of his own health care. But with the limited time, I would like to ask Mr. St. Clair a question. We talked about the system being voluntary or an opt-out. Would you comment, with your expertise in this area, on that particular portion for the participant, please? Mr. St. Clair. Certainly, Mr. Chairman. I was interested in Speaker Gingrich's remarks around the notion of voluntary participation in systems like this, particularly when he also mentioned the fact that disaster recovery, responding to crises, was a very important goal of his. Our view is that basic transport of clinical information that follows the HIPAA regulations is the most appropriate way to respond to the crisis in quality of care and patient safety and to crises of different sorts in this country. So we need to be able to mobilize data that exist within the walls of payers to benefit the patient through treatment in an opt-out environment, in our opinion. However, having said that, the use of personal health records is truly a voluntary act, and we believe that one of the real benefits of implementing both the payer-based health record and the personal health record systems at the same time, or essentially at the same time, is that the personal health record lets those early adopters who want to make sure that all of their information can be sent to their doctors in emergency rooms and others when they are seeking treatment control that process and put more information in and make corrections. But, on the other hand, it also allows those who really don't want it to happen to opt out very, very easily. We currently allow opt-out procedures for folks who are having their information processed in our systems and delivered on behalf of our customers, but we think that the trickle of records that would come in would prevent the vast majority of providers, physicians and others in this country, from ever changing their work flow to adapt to the presence of records. The fact that we can go into the State of Illinois with 3.7 million records really makes it so that the hospitals, the emergency rooms, the physicians there will automatically build into their work flow the notion that those records are available. If only 5 percent of that 3.7 million opt in and we are not allowed to distribute the rest, no hospital, no doctor will bother to do that, other than those on a very, very sort of early adopter phase. So we think it is really an issue of proving to the Nation that, in fact, this basic kind of information should be delivered unless people say they do not want it to be delivered. Mr. Porter. And this question is to whoever would like to respond. As I have been meeting with the different insurance companies and the providers that have instituted this new technology, and they all brag about the advantages, but to an organization, they have talked about the challenges of a cultural change within the business, not only for the doctors but also everyone up and down the food chain. My goal with the trust funds, or whether we can fix it through Judiciary and other means, is to also have some of these funds available to help in training and transition, because at Sierra Health Services of Nevada, Health Plan of Nevada, we spent a lot of time looking at their system. And I spoke of it earlier in my opening comments on how successful it has been. But they said one of their biggest challenges was the cultural change, and in my prior life, I did work for an insurance company, and we went through major technological changes--I date myself--in the 1980's and the 1990's and transitioning. I know that there was a challenge. But do you have any insights on this change of culture once the hardware and the software is in place on encouraging this change more rapidly? Dr. Hasan. Edison invented the electric bulb, which is a very obvious and a very easy thing to use. It took over 30 years to be integrated in the usual life and the work flows and work processes. The PC, we are seeing the benefit of the PC revolution, which started in late 1970's, early 1980's, now. So we will have to be patient and make it available, going back to the issue of whether it should be mandatory or whether it should be voluntary. For the carriers it should be, in my opinion, mandatory. For the membership, it would be--by nature of it, it would be voluntary, whether they use it or not, but it has a negotiating effect. Once people start using it, get the benefit, like you spoke to that person from the Veterans Administration, people have that experience, they go out, talk to their friends, speak to their acquaintances--that is how you will see the culture change. Culture is not going to change by mandate. Culture is not going to change by legislation. But what legislation can do is to make it available for the people to change their habits and their culture. Mr. Porter. Yes? Dr. Handel. I think Dr. Hasan is on target. The other thing we realize is if we can integrate what we are doing into the normal work flow of offices and hospitals, that is going to make a big difference also. If this is looked upon as yet another hurdle to overcome, another major problem, I think we will have resistance. But the experience that we have had in Delaware already, where the emergency room doctors initially did not want to use it, but now they understand how valuable it is, has created a whole new culture very rapidly. And I think our job as the industry, if you would, is to make this as easy and as integrated into the work flow as possible. Mr. Porter. Yes? Dr. Barlow. Chairman Porter, I would like to suggest that there are actually two cultural changes that need to take place here. One is the change to move from thinking about health care in a provider-centric model to one that is moving to thinking about health care in a patient-centric model. And what I mean by that is care today and the information that we have in order to deliver care centers around the provider and what they have and what they can effectively get from other individuals to be able to support that patient. Giving the patient more information to give their provider helps to change the provider's focus to a more patient-centric model, but we really need to get where we can totally organize data around that patient so that any provider, anyone who interacts with the system thinks about it in terms of the patient, not themselves and what they have. I think that is key. Mr. Porter. If I can interrupt, you know, in Las Vegas, we have 40 million visitors a year. Think about that. You know, the State is only 2.2 million people, but we have 40 million visitors. And as I have visited the hospitals and the emergency rooms and the trauma center and talked about health care delivery to our visitors, one of the major--the largest hospital in Las Vegas that is part of Humana, they said 8 or 9 percent of all their emergency room visits are by visitors from somewhere else, and how frustrating in trying to deliver health care when they cannot find out any information. They are not sure of the meds. Sometimes they cannot communicate. And I think you are absolutely right. It has to be driven from the patient, and that is an example where if you travel anywhere in the world, you should have access. I am going to conclude the meeting because we are going to vote here shortly, but I just want to leave you with one thought. I started the meeting today talking about a foster child. You know, these foster kids do not have the advantages of the latest technology, and they do not have the latest in health care in many respects and many times do not have a loving home to take care of other than a foster parent trying to be their parents. I firmly believe, as I said in my opening comments, that by working with a first-class system, which we have as Federal employees--we have the best in the world, and making it even better--we will truly help those least among us in this country. And in combination with the funds we passed in December, $150 million to help with Medicaid and health information technology to transition, I believe that not only do we have the best system today, we will have a far better system in the future. So thank you all very much for your testimony, and I look forward to working with you in the future. The meeting is adjourned. [Whereupon, at 5:19 p.m., the subcommittee was adjourned.] [The prepared statements of Hon. Wm. Lacy Clay and Hon. Elijah E. 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