On the Brink
Transcript of BioCentury This Week TV Episode 125
Rep. Jack Kingston (R-Ga.), Chairman, Committee on Appropriations' Subcommittee on Labor, Health and Human Services, Education and Related Agencies
Rep. Jim McDermott (D-Wash.), Ranking Member, Committee on Ways and Means' Subcommittee on Health
PRODUCTS, COMPANIES, INSTITUTIONS AND PEOPLE MENTIONED
Francis Collins, Director, National Institutes of Health (NIH), Bethesda, Md.
U.S. Congressional Budget Office (CBO), Washington, D.C.
U.S. Department of Health and Human Services (HHS), Washington, D.C.
U.S. Food and Drug Administration (FDA), Silver Spring, Md.
National Institute for Health and Clinical Excellence (NICE), London, U.K.
Ron Klein (D-Fla.), Former Member, U.S. House of Representatives
Rep. Rosa DeLauro (D-Conn.)
Rep. Sam Farr (D-Calif.)
William Frist (R-Tenn.), Former Member, U.S. Senate
Steve Usdin, Senior Editor
STEVE USDIN: Will science be sequestered? We hear from a top Republican who oversees the HHS budget and a key Democrat on the tax writing Ways and Means Committee. I'm Steve Usdin. Welcome to BioCentury This Week.
NARRATOR: Your trusted source for biotechnology information and analysis, BioCentury This Week.
STEVE USDIN: When President Obama delivers the State of the Union address this week, he'll be speaking to a polarized Congress that's stumbling from deadline to deadline. If Congress doesn't act by March 1, budget sequestration will slash funding for biomedical research and oversight of the nation's food and medical products. Today, we'll talk about sequestration with one of the most conservative Republicans in Congress and one of the most liberal Democrats.
Georgia Republican Jack Kingston chairs the House appropriations subcommittee that sets the budget for HHS, including NIH and the CDC. He is adamantly opposed to the Affordable Care Act. Washington State Democrat Jim McDermott has pushed for government-run health care while lambasting Republicans for opposing the Affordable Care Act.
We're on Capitol Hill with Representative Jack Kingston. Representative Kingston, thanks for taking the time to speak with me today.
JACK KINGSTON: Thank you.
STEVE USDIN: I want to start with sequestration. Is it going to happen?
JACK KINGSTON: I think that it is. If you talk to a number of people, it's the next big thing in Washington. It's March 1. After that, we actually have the continuing resolution that will be up for discussion, and then we have the budget, then we have the President's budget. But the sequestration is first in line. And I believe it is going to happen. We in the House have passed alternatives for it as early as last May 2012, and the Senate hasn't come up with any, so I think it's going to take place.
STEVE USDIN: So we've had the NIH director, Francis Collins, on this show. He said that sequestration would be a disaster for American science. Others have said that sequestration would have disastrous effects for FDA's ability to protect food and drugs, for the CDC, which is closer to your district. Do you think that they're all exaggerating?
JACK KINGSTON: I think that's the kind of thinking that got us in this mess to begin with. Right now, our national debt is 100% of the GDP, $16 trillion dollars. For every dollar we spend, $0.42 is borrowed. That's unconsciousable [sic]. We cannot pass that legacy down to our children.
So what we're looking at with sequestration would be approximately about a 5% cut to these agencies. So to say I've got to operate on 95% of what I did last year -- that's not disastrous. Now, if we were saying we're eliminating you, that's a different issue. But to say to the national agencies that 95% is what you're going to get, that is not disaster.
And I think unfortunately, that kind of hyperbole and rhetoric is not helpful. Where we need to come together and saying, look, there are some agencies that have overreached, that have erred and strayed from their original mission. We need to get them refocused, regroup. There's some people that are falling through the cracks. We need to make sure the safety nets are there for them. We do need to keep our cutting edge on science. There's no question about it. But going to 95% spending level from last year is not the end of the world.
STEVE USDIN: So do you think going forward that that's going to set a new baseline for where NIH is going to be, for example, for FDA is going to be? It's not just a one year blip. It's a cut, and it's going to keep on going for a decade.
JACK KINGSTON: Well, we do have to get our fiscal house in order, unless people think Greece is a good role model for us, and I don't think anybody does think that. The question I would say is you know, come to the table. In May, when we were offering an alternative to sequestration, our -- over the past couple of years, as we've offered budgets, which budget did you get behind? The one that further dug the deficit, or the one that addressed it?
And you know, the reality is you have got to address your deficit, regardless of what country, what city, or what state you are. You can't have the spending level that we have had. And so I don't know if it becomes a new baseline or not, but we could move in a direction like that.
STEVE USDIN: So as you mentioned, we've got a whole series of these kind of crises or cliffs coming up. The next one's going to be the possibility of a government shutdown. Then after that, there's the debt ceiling, there's budgets. Is each one of these going to be an opportunity, in your mind, to kind of ratchet up savings, ways to cut the budget some more?
JACK KINGSTON: Well, it would be very nice if this administration, which has averaged a deficit each year of $750 billion, if they would come to the table and say you know what, election's over. The president's got one term left. He's not going to run for office again. Let's use some of his goodwill to address some of these difficult financial issues.
And you know, certainly, both parties have a lot to blame in terms of how we got in this position. So both parties have to get us out of this position. And I'm certainly willing to work with the White House and the Democrats in the Senate to come up with alternatives to any of this.
STEVE USDIN: So one of the ways that you could -- You're going to have an opportunity, I guess, to try to work with the Democrats in the Senate is over a budget. There hasn't been an HHS budget passed in, what, four years or so? This year, theoretically, it's going -- Do you think it's going to happen. And if it is, how are you going to be able to reconcile the enormous differences between the positions that Republicans have and Democrats have on budget issues?
JACK KINGSTON: You know, I think in terms of our budget, which includes labor and education along with Health and Human Services, is the Democrats sort of have in mind $165 billion as discretionary level. Republicans think in terms of maybe $155 billion. So it's not that far.
STEVE USDIN: That's not a big difference, yeah.
JACK KINGSTON: But unfortunately, to many of the Republicans, that's too high. And I'm sure to many of the Democrats, that's too low. And so even though numerically you can get there, you still have to have the majority of votes in both houses. And all branches of the Congress have to sign off. And that's going to make it difficult.
STEVE USDIN: So you mentioned -- that's on the discretionary side. Then there's also a non-discretionary side. Another way to split things up is between discretionary and entitlement spending. Do you think that there's real prospects for entitlement reform involving health care spending?
I don't think there is. I think there's a lot of things you actually could talk about when it comes to Medicare. I think health savings accounts are very helpful, gives some motivation to the users to save a little bit of the money. I think end of life preparation, because so much of the Medicare dollars are actually spent in the last three months. And living wills could actually save us billions of dollars.
STEVE USDIN: Let's talk about that more right when we come back. We'll be back with Representative Jack Kingston in just a moment.
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STEVE USDIN: We're on Capitol Hill with Representative Jack Kingston. Rep. Kingston, I'm surprised that you mentioned end-of-life care. That was one of the most divisive issues, actually, in the debate over the Affordable Care Act. What's your idea there?
REP. JACK KINGSTON: Well, on living wills, I think it would be so important for people to know, well, what was their loved one's expectation? For example, my dad died when he was 90. Now, before he died he had congestive heart failure, so we did the responsible thing as a family. We sat down and did his living will. And the bottom line was he said, OK, if you keep me alive once I am dead, I'm going to come back and haunt you because I don't want to be on life support. And I think that families have to have that understanding between generations of what the expectation is because right now so much of the Medicare money is being spent to keep people alive who are not going to live.
STEVE USDIN: And is that something that government should play a role in, for example, in paying for physicians to have those conversations with people?
JACK KINGSTON: I think to urge people to have that discussion is the proper role of government when the government's paying 100% of the cost. I think that the living will itself needs to filled out between the generations without somebody from the government.
STEVE USDIN: So staying on health care, though switching gears to the Affordable Care Act, you spent an awful lot of time and energy trying to have the Affordable first, prevented from being passed and then, to have it repealed. Is that still your goal to try and get it repealed?
JACK KINGSTON: I would like to see it repealed. I think, if you look at it politically, it's going to be very hard to get it through the Senate, and certainly the president is not going to eliminate his signature--
STEVE USDIN: It's impossible.
JACK KINGSTON: --piece. Yes. So I think in terms of our committee and things that we can do, looking at things like IPAB, looking at the preventative medicine portion, looking at things like the Class Act, which we did just eliminate, we can make the Affordable Care a better product by nibbling around the edges, if you will.
STEVE USDIN: Well, let's take those things one at a time. IPAB, that's the Independent Payment Advisory Committee, or Board, that's supposed to recommend mandatory cuts in Medicare. The way that the CBO scores it, the IPAB wouldn't even make those kind of recommendations. It wouldn't come into effect for about 10 years. Why is it important to even bother with that now?
JACK KINGSTON: I think a lot of people are just very concerned that this unelected, nebulously defined, 15-person board can make rational decisions. And so I think that's the suspicion on them. In Great Britain they have a similar board called NICE, and they make health care decisions that people don't like all the time. So I think people are worried about going in that direction.
STEVE USDIN: And so do you think there's a real prospect of being able to repeal the IPAB?
JACK KINGSTON: In fact, I know that there is a bill that has been introduced to eliminate it. There's also been another bill introduced to eliminate Obamacare. Now, if those get passed on the House floor, it's going to send a very strong signal to our committee that we need to follow suit or at least do something about it.
STEVE USDIN: And what about some of the other unpopular aspects or aspects of the Affordable Care Act that are particularly problematic for Republicans? One of them, medical device tax, for example.
JACK KINGSTON: Well, and there's a piece of legislation free-standing. It is bipartisan, Ron Klein, being the leading Democrat on it, that eliminates the tax on medical devices. I think that's probably going to get out of the House this year, and so we'll see. I believe you will have a myriad of bills introduced that are authorized and tight bills that will not necessarily be passed, signed into law. But some of those amendments are going to live and survive on our bill when we bring it to the House floor.
STEVE USDIN: And so that's really just political statements because, as you say, when you send them over to the Senate they're not going to get passed, and they certainly wouldn't get signed by the president.
JACK KINGSTON: They're not, but if you think, OK, there are 15 of them. If five of them survive, and it is likely some will survive in some form, then that's going to be what we could expect. But that would be five more that would be eliminated that we would not have had, had we done nothing.
STEVE USDIN: And what do you think -- earlier you said about entitlement reform about changing Medicare -- you don't think there's any prospect for doing anything serious on Medicare this year?
JACK KINGSTON: I don't think so because it is such a scare tactic, politically, where any time you touch Medicare it's because you hate seniors. You're going to push them out on the street and take them out of the hospital. So we do not have the leadership at this point in our country to have an intelligent, a mature, discussion on Medicare or Social Security. It'd be really nice. It needs to start with the White House, and the White House could reach out to senior members of Congress in both parties and say, let's come together. Let's see what the possibilities are. But the president, in my opinion, is very long on rhetoric. He makes great speeches, and there's very little follow up.
STEVE USDIN: One of the things that you've mentioned, that I've heard you say before, is that you think that one of the problems, the reasons we're lurching from this crisis to crisis is a lack of communication between senior Republicans and the White House. Can you give an example of what you mean by that?
JACK KINGSTON: Well, yes. I think this is still a game that relationships count. And I know having worked with Rosa DeLauro, who's a Democrat on the committee, that we're divided philosophically, but we're very good friends personally. Sam Farr, the same thing. When he was a ranking member, I went into his district. You can build relationships and you can get some things done, but we don't see that out of the White House.
Several years ago, for example, I was playing on the flag football team. We have a little football team that plays for charity. We raise money, and the president one day invited all the Democrats to go play basketball with him. It was a fun thing to do. It doesn't matter if you're Democrat or Republican. Play basketball with the president, and you got a photo on the wall forever. But he didn't invite a single Republican, and he actually only did it once for them. You see, what a great bully pulpit.
Now, Clinton used to invite me to go see the turkey forgiven, which is a longstanding tradition. President Clinton would invite me and other Republicans over to eat in the house mess, or the White House mess, the dining hall. He worked it so that people got to know each other after hours and therefore, when you went toe-to-toe negotiating something very sticky, you had a relationship. And you didn't say, hey, you're wrong and you're an idiot. You said, you're wrong. I disagree, but let's figure this out. And I think that element is one of the great deficits of this president's style.
STEVE USDIN: What do you think, in a practical way, would be different if you had that give and take and you had those kinds of personal relationships? Are there things that would actually, substantially, be different?
JACK KINGSTON: I think there would be because right now it's not good enough to disagree with somebody. You have to call them a name, their wife a name and tell them their dog is ugly. And that's not progressive to anybody. It's not constructive. You really get people together and saying, I respect your position. I respect your right to be here and disagree with my position, but still there are some things we can, in this atmosphere, come together on. And I think it would make a huge difference.
STEVE USDIN: If you had to name one, two, three things that are the most important things that you think that the gap isn't that big, where the Democrats and the Republicans could come together, what do you think they are?
JACK KINGSTON: There's lots and lots of things. On food policy, making America competitive again, innovation, technology, certainly alternative energy, and there's things that we could do together. And you start with the small stuff, get the momentum going, and before you know it, you have Social Security reform. It might be down the road, but it's possible.
STEVE USDIN: Well, thank you Rep. Kingston. We'll be back in just a moment with Rep. Jim McDermott, the ranking Democrat on the Ways and Means Committee's Health Subcommittee.
NARRATOR: BioCentury This Week host Steve Usdin named 2012's Harvey W. Wiley lecturer by the FDA Alumni Association. He's the first journalist to receive the Wiley Award.
STEVE USDIN: Representative McDermott, thanks for taking the time to speak with me today. I wanted to start by asking you -- you're the chair of the Ways and Means Health subcommittee. What are you expecting or hoping to hear from President Obama in the State of the Union address about health issues?
JIM MCDERMOTT: Well, I'm the ranking member. I'm not the chair. If we were in the majority--
STEVE USDIN: You will be someday, maybe.
JIM MCDERMOTT: But I expect the president's going to talk about implementation of the major program that we put in two years ago, the Affordable Care Act. That is going to be the main, major focus, I think, of health care in this country over the next two years.
STEVE USDIN: So what does that mean from a legislative standpoint? What do you expect to happen on the Hill to either make the Affordable Care Act get implemented more smoothly or what are the things, the pitfalls, that you might try to avoid?
JIM MCDERMOTT: Well, one of the things I worry about is that we'll spend a lot of time with people trying to repeal it. Bill Frist and I had a conversation, and Bill Frist's attitude is if you don't like it, don't repeal it, fix it. And I think that as soon as the Republicans in the House decide they're not going to try and repeal, they're going to fix it, then we're going to have to deal with things like subsidies for employers, and subsidies for individuals, and how the exchanges are going to work. Many states have opted not to create their own exchange, so that means the federal government's going to have to come up with an exchange. And there's going to be a lot of fine tuning of the bill.
I talk about it like a house. We bought a house. Now we're talking about the countertops, and the colors of the wall, and the light fixtures, and the plumbing fixtures. That's really what we're doing, is fine tuning the house of health.
STEVE USDIN: And do you have confidence that starting in October, when the exchanges are supposed to start enrolling people, that things are going to be ready, and that in January, when it's supposed to start happening, people are supposed to start getting their health care through the exchanges, that that's all going to happen?
JIM MCDERMOTT: I've never seen the launch of any program that didn't have some problems at the beginning. You can look at industry or anywhere you were, you always have some problems. And I'm sure there will be some. But we're going to get it up and get it going. The American people are demanding it, and should not be denied it. And I think the Congress knows that, and will ultimately put something together.
STEVE USDIN: I want to take a step back. Some of the other issues, the big issues that you're going to be dealing with in this Congress -- first up is going to be sequestration. Do you think sequestration is going to happen?
JIM MCDERMOTT: Well, for a long time, I thought it would. It's such a imprecise way to deal with government. I didn't think it would happen. But I'm beginning to believe that the Tea Party people in the House are so enamored with their ideas, their ideology, that they are going to let it happen because they think it won't have any effect.
It's like hitting a nail with a sledgehammer. You don't know where the pieces are going to fly from this. And they're going to find out some rude things, because they will not be anticipating what sequestration will really mean.
STEVE USDIN: And do you think that then there may be some effort to mitigate it once it's gone into effect, or is it going to be we're just going to have to deal with it?
JIM MCDERMOTT: We'll be picking up pieces afterward. I mean, if we make cuts in, let's say, National Institutes of Health, and we don't put money out there for grants to be given to professors who have been doing research, we will stop the pipeline from being filled. And ultimately, we'll have to find some way -- you remember the crash course in this country around Sputnik. When we suddenly realized the Russians were way ahead of us, we had this huge investment. Well, we're going to have to do that at some point down the road, because we're not doing it now. We should be doing it on a regular basis.
STEVE USDIN: Quickly, also, you had some legislation that you've introduced, or that you're pushing, on primary care physicians.
JIM MCDERMOTT: Yeah. It's clear that if we're going to cover everybody in this country, we need more primary care physicians. I created a program called Our Docs, which is like the ROTC. We decide every year how many military officers we need. We give scholarships, we give a stipend, and then they give five years to the country as a payback for that. Same way with doctors. If we know how many doctors we're going to need, we ought to give that many scholarships and put them in the pipeline, and in four years, we'll have what we need. If we don't do that, we're going to have real problems in this country, because we've got too many specialists, and not enough people in primary care.
STEVE USDIN: Have you had any support from the administration, very quickly, or from Republicans on that idea?
JIM MCDERMOTT: I got lots of response from the medical community, the primary care docs and medical students and people like that. The administration, I think, they put some money into the National Health Service Corps, but not enough money. Those scholarships are all gone. We need a much larger effort in that regard.
STEVE USDIN: Well, thanks, Representative McDermott. We'll be right back, and when we do, we're going to talk about Medicare.
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STEVE USDIN: I'm in the Democratic Caucus offices with Representative Jim McDermott from Washington. Representative McDermott, there were a lot of things that were -- or at least some things that were in the fiscal cliff bill that surprised people after the fact. One of them was provisions that helped companies to develop or market oral drugs for diabetes. What did you think about that?
JIM MCDERMOTT: Well, I voted no on that bill, for precisely that reason. When you don't have a chance to read a bill and you know it's got so much money in it, there's going to be things in there that are going to surprise you. And I was not surprised that something like that happened.
I disagree with that particular thing. I think they shouldn't have done it. But there should've been a hearing. It should've been aired. It should've been transparent for the American people. It wasn't.
STEVE USDIN: And that seems to be part of this whole kind of roller coaster that we're on, where we lurch from one thing to another, from the debt ceiling to sequestration to a possible government shut-down to the debt ceiling again. Is there any way to get off that roller coaster?
JIM MCDERMOTT: I think so. It's returning to the regular order in Congress, that is you have ideas that become bills, that you have hearings. You talk about them.
You contemplate them. Then you have an amendment session. Then you bring them to the floor.
What's happening is things are being brought from the Speaker's office to the Rules Committee to the floor. And nobody's had a chance to see what's going on. As long as that's the way things operate, you're going to have this kind of thing that happened the other day on the third of January.
And it is a loss for the American people, because 400 members of Congress don't know what in the world they're doing out there, except their leader says vote yes. Well, that's not a way to run this country.
STEVE USDIN: So there's going to be some of those hearings and there's going to be some of that kind of debate coming up about Medicare.
JIM MCDERMOTT: Yes. I hope so.
STEVE USDIN: And the Republicans' ideas on Medicare, two of them that are near the top of their agenda, one is a premium support plan, shifting to that, and another is raising the eligibility age to 67. What do you think about either of those ideas?
JIM MCDERMOTT: Well, I think that you have to come back to the question of, what do you want Medicare to do? Do you want it to take care of the seniors' medical problems in this country or don't you? If all you're worried about is money, it's easy. Just don't see anybody on Medicare until they're 75.
Then you'd have 10 years of people would be on their own until they got to be 75. Raising the age limit is not going to solve it, because all it does is shift the cost onto the families. Young people are going to suddenly wind up taking care of their parents.
And I think that the premium support idea, again, it's the government saying, we're going to spend this much and no more. We don't care what it costs. We don't care.
We're just going to give you a check for $5,000. You go out and find your own insurance company. Now that's saying to senior citizens and their families, you're on your own.
STEVE USDIN: So you're opposed to that.
JIM MCDERMOTT: I don't like those solutions.
STEVE USDIN: Do you think that there is a need to reduce the cost of Medicare? And if so, how to do it?
JIM MCDERMOTT: Absolutely. Well, I think it means coming and looking at the system and finding the inefficiencies. We spend way more money than any other country in the world and we get less. Actually, our costs in Medicare per person are flat.
What is our problem is that we've got 80 million baby boomers. Starting in 2011, they're turning 65 and they're coming onto Medicare. And the problem is not that we're spending too much on them. It's just there are more of them. So we've got to figure out where the money is for more of them.
And I think we can find an awful lot of it by being more efficient in the system. We're paying now for volume. Do more, get more. It ought to be, doctor, give us quality. We'll give you more if you give us better quality.
STEVE USDIN: One of the other things as a physician, I'm sure you know about it, and on the Ways and Means Committee, is the so-called doc fix. There was an effort in 1997, Congress said, we're going to take care of this. We're just going to cut the amount that we pay to physicians. That didn't work out so well. Every year they'd have to figure out a way to not make that cut. Is there a way to get rid of that problem permanently, the doc fix problem?
JIM MCDERMOTT: Well, it was doomed from the start. Some of us voted against it because it was an across-the-board cut. It didn't look at any of the nuances of how you pay physicians or who should be paid what. And I think what we ought to do is scrap it and start over again with a system that pays for quality rather than quantity.
STEVE USDIN: Thanks very much Representative McDermott. Thanks to Jack Kingston. Thank you for watching. I'll see you next week.