Opening Statement of the Hon. Nancy L. Johnson, 
a Representative in Congress from the State of Connecticut,
and Chairman, Subcommittee on Health 

Hearing on H.R. 2768, the "Medicare Regulatory and Contracting Reform Act of 2001"

September 25, 2001

Before we start today, it seems important to me to acknowledge that today's hearing on regulatory relief actually was supposed to have taken place two weeks ago today. As we all know, history intervened, in the form of unspeakable tragedy, disrupting not only our hearing but, so much more importantly, the lives of so many American heroes . While we continue to mourn, and to grieve, and to respond to the evils of terrorism, it is a sign of the strength of this great nation of ours that we can also move forward with the business of governing. I want to thank our witnesses for coming back today to give us the benefit of their expertise.

Over the past several months, members of this Subcommittee have been working together closely to better understand the challenges facing providers who serve Medicare beneficiaries. On March 15, we held a hearing on the need to extend relief from burdensome regulations to Medicare's providers.

At that hearing, we heard from doctors and hospitals, from home health agencies and nursing homes. Although examples differed, the basic message from each group was the same. Providers are overwhelmed. Instead of caring for patients, health care providers are spending too much time filling out forms. These are good people. And yet they are inundated by paperwork, second-guessing, and heavy handed oversight. If we do not act, we risk losing the providers we need to ensure that seniors have access to high quality care.

After that hearing, we got to work. In May, Pete Stark and I wrote Secretary Thompson making a number of suggestions regarding regulatory improvements the Department could make using existing administrative authority. Many of those changes have already been accepted.

At the same time, we began developing a legislative package to address problems that could not be corrected administratively. We examined the proposals set forth by Representatives Toomey and Berkley in their bill, HR 868. They make important suggestions - many of which we adopted. But we also were sensitive to objections raised by the Office of Inspector General to provisions in HR 868 that put program integrity at risk. We tried to assemble a bill that extends relief to providers but protects taxpayers from waste, fraud, and abuse.

On August 2, Pete Stark and I introduced our bill, the Medicare Regulatory and Contracting Reform Act of 2001. I am extremely pleased that every member of the Health Subcommittee has joined us in cosponsoring HR 2768, along with many of our colleagues from the full committee.

The basic goal of HR 2768 is to create a more collaborative, less confrontational relationship between providers and the Centers for Medicare and Medicaid Services. Our bill will diminish the paperwork load required to meet complex and technical regulatory requirements and immediately free up for patient care time that providers now spend completing and filing federal forms. HR 2768 streamlines the regulatory process, enhances education and technical assistance for doctors and other health care providers, and protects the rights of providers in the audit and recovery process to ensure that the repayment process is fair and open.

In addition, the Secretary is given the tools to manage Medicare program operations efficiently. For the first time, the Centers for Medicare and Medicaid Services will be able to competitively contract with the best entities available to process claims, make payments and answer questions. The Secretary will be free to promote quality through incentives for the Medicare Administrative Contractors to provide outstanding service to seniors and health care providers. Contractor reform initiatives will eliminate artificial distinctions between Medicare's Part A and Part B with regard to contracting practices.

Since introducing HR 2768, we have received useful input and technical suggestions from a range of interested groups, and we will be carefully evaluating those suggestions to see what good ideas we can incorporate into our bill as we move to markup. In particular, I continue to be interested in finding ways to allow providers to challenge audit findings and the validity of probe samples before they have to formally pursue an appeal.

Today, we will hear from Tom Scully, Administrator of CMS. Mr. Scully will set forth the Administration's views on HR 2768 and talk to us about the Department's efforts to extend regulatory relief to providers. This will be Mr. Scully's first appearance before our subcommittee in his capacity as Administrator. Tom, we look forward to working with you at CMS.

On our second panel, providers will comment on the bill, and we will hear from the General Accounting Office about its recent work on physician documentation requirements. Again, I thank you all for being here today.