Right Now

December 2014

It’s Christmas time for special interests in Washington and Congress is playing Santa.  The tax extenders package the Senate will pass this week is a congressional Christmas tree full of goodies for everyone from Wall Street to Sunset Boulevard. Tuna companies, race horse owners, luxury hotel developers, and Hollywood movie makers are just a few of the groups on Congress’ nice list this year.

This week the Senate will extend more than 50 special tax expenditures that expired at the end of 2013, adding more than $41 billion to the debt over the next ten years. H.R. 5771, Tax Increase Prevention Act of 2014, is another reminder that Congress continues to fail in its promise to overhaul the tax code, which is full of handout for the well-off and well connected. 

“This bill represents the worst habits in Washington. Politicians in a lame duck, end-of-the-year session, passing out goodies to well-connected industries instead of lowering tax rates for all Americans.” said Senator Coburn. “For each of these that benefit only one company or industry, other taxpayers must pay more. It’s unfair system that benefits only a few at the expense of everyone else.”

“Congress must stop the perpetual temporary extensions of wasteful tax breaks, and make the tax code flatter and fairer for all taxpayers.” 

Last week, Dr. Coburn released a 320-page expose, Tax Decoder, which decodes the tax code. The report describes more than 165 tax expenditures worth over $900 billion this year and more than $5 trillion over the next five years. Many of the extenders in the package today are detailed in the report. See the attached spreadsheet for more details on each provision.

Dr. Coburn filed 12 amendments to the extenders legislation, including amendments to strike the extension of the New Markets Tax Credit, which gives Wall Street banks nearly $1 billion annually in tax credits. Other amendments would strike a special tax credit for railroad track maintenance, eliminate the NASCAR tax break for owners of motorsport race tracks, and eliminate tuna tax break, among others. 

Dr. Coburn's amendments to tax extenders are here

(WASHINGTON, D.C.) – The disability trust fund will be completely exhausted in less than two years, according to the Social Security Board of Trustees. When this happens, the more than 11 million Americans receiving disability benefits will face immediate cuts of nearly 20 percent, unless Congress acts soon.

Today, U.S. Senator Tom Coburn, M.D. (R-OK) announced the introduction of S. 3003,the Protecting Social Security Disability Act, a bill to improve the integrity of the disability insurance program, support working Americans with disabilities, and protect benefits for current and future generations.

“In addressing this looming crisis, we cannot afford to kick the can down the road by taking money from retirees and ignoring the program’s real problems,” Dr. Coburn said. 

“Despite skyrocketing expenditures, we have failed to provide disabled Americans with the resources they need and want so they can work to the best of their abilities. We have failed to reform program rules that are too often abused and gamed. And we have failed to reverse the growing treatment of the program as an early retirement and unemployment system. We can do better.”

“I hope this bill will begin a serious conversation about how best to address the fundamental challenges faced by the disability program. Ignoring these problems does nothing but threaten the benefits upon which millions of disabled Americans depend.”

The Protecting Social Security Disability Act strengthens the program to preserve it for current and future generations, strengthens and improves the application process to ensure benefits are adequate and quickly available for only those who need them, and provides resources and incentives to disabled Americans who want to work and have the ability to do so. It does this by, among other things:

  • Updating the program’s disability classifications to ensure those with temporary disabilities are admitted to the program on a temporary basis;
  • Mandating the use of medical continuing disability reviews (CDRs) for those admitted on a permanent basis but whose improvement is possible;
  • Reforming the disability hearing process to require the submission of all relevant evidence on a timely basis and implementing additional procedural rules that will make hearings more fair, consistent, and efficient;
  • Eliminating the 'substantial gainful activity' earnings limit for beneficiaries and providing incentives to maximize their earnings;
  • Exploring innovative ways to direct resources toward high-risk individuals to help them stay in their jobs, such as identifying disability applicants not yet in the program and provide them with training, benefits or stipends.

A statement for the record accompanying the bill can be found here.

A section-by-section summary can be found here

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Washington, D.C. – U.S. Senators Tammy Baldwin (D-WI) and Tom Coburn (R-OK) sent a letter applauding AbbVie Inc.’s recent agreement with the Medicines Patent Pool (MPP) to enhance affordable access to HIV treatments for children in developing countries. The Senators expressed support for negotiations earlier this year and are now commending the licensing agreement for two World Health Organization-recommended medicines for children that will allow the drugs to be made at a lower cost for pediatric HIV patients in the developing world.

“I am extremely encouraged by this commitment to help provide affordable and essential HIV treatments to children in developing countries,” said Senator Baldwin. “Combatting HIV/AIDS requires collaboration from everyone, and AbbVie’s partnership with the Medicine’s Patent Pool marks another important step in our country’s fight to help the most vulnerable and to achieve an AIDS-free generation.”

“I applaud AbbVie for working to extend the reach of its lifesaving drugs to children in need around the world,” Dr. Coburn said. “Its decision brings us one step closer to achieving an AIDS-free generation.”

The Medicines Patent Pool is a United Nations-backed organization founded in 2010 by UNITAID to increase access to HIV treatment and spur innovation worldwide by negotiating patent licenses for the production of low-cost versions of new and existing medicines. The AbbVie-MPP collaboration, which marks the first time AbbVie has granted a license for generic production of its HIV drugs, extends MPP’s portfolio to eleven antiretrovirals and for one medicine for an HIV opportunistic infection. Ten generic manufacturers have now licensed from the organization.

An online version of the letter can be found here.

An online version of this release can be found here.

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Senator Tom Coburn today objected to passage of a bill supporters claim would help prevent veterans’ suicides but would actually do little to actually fix the broken VA health system that is failing to adequately care for veterans.

“Instead of holding VA bureaucrats accountable to ensure existing efforts are meeting the mental health needs of veterans, this bill would duplicate programs the VA which the agency has already failed to manage,” Coburn said.

“All Americans-- veterans and taxpayers alike-- should be outraged at this tragic situation.  Those calling my office in support of this bill should instead be calling the VA demanding the agency and their own member of Congress demanding that they keep the promise to care for veterans.”

While well-intentioned, H.R. 5059 would do little to change or improve the deplorable situation at the VA, which is providing substandard medical care for the country’s military heroes.  The bill creates several new programs at the VA and authorizes $22 million in new federal spending.  In almost every case, however, the VA already has the tools and authorities it needs to address these serious problems.  Further concerns with the legislation can be viewed here.  

“Congress should hold VA bureaucrats accountable for their failing programs and substandard medical care instead of passing legislation that will do little to solve the tragic challenge of veteran suicides.” said Senator Coburn.  “Our military heroes deserve more than false promises. It is dishonest for Congress to pretend that passing yet another bill will finally solve the challenges plaguing the VA.”

“The VA has proven that questions need to be asked before it is entrusted with the lives of veterans or the money of taxpayers. The only way Congress can help the VA solve this problem is through rigorous oversight, to ensure the promises we’ve already made are being carried out. New programs and new funding is not the answer, but give false hope to those already suffering.”

More than 1,000 veterans have died a result of poor medical care and waiting lines at the VA, found Friendly Fire: Death, Delay, and Dismay at the VA, a report on mismanagement at the VA released by Dr. Coburn earlier this year.  Among its findings, the report exposed the failure of the VA in addressing the mental health needs of our servicemen and women.  The VA failed to meet its 14-day goal in 34 percent of new mental health appointments in the areas of psychiatry, psychology, post-traumatic stress disorder, and substance abuse in 2013.

“This is a serious issue and needs a serious response.  Only in Washington would someone think the answer is to give more money and responsibility to an agency that has made headlines all year for providing substandard care, long delays for veterans to see a health care provider, and mismanagement,” said Coburn.  “Instead of pretending this bill will somehow fix the problem—which the President just signed a $10 billion bill in August to address—is typical Washington.”

As a physician, Dr. Coburn believes veterans should have access to the best medical are and any doctor they choose, not locked inside this broken system that clearly does not have the necessary mix of providers needed to care for vets in a timely manner.  The legislation he introduced with Senators McCain and Burr, the Veteran’s Choice Act, was the basis for giving veterans more choice and accessibility to medical providers and non-VA hospitals in veteran’s hometowns.

“How many bills need to be passed before Congress realizes the VA is unaccountable and takes real actions to ensure the fulfillment of the promises made to our veterans?” 

A video of the speech is here

Senator Coburn will offer a motion today in an attempt to undo a precedent set in 2011 that took away the right—provided by Senate rules—for senators to suspend the rules post-cloture to offer an amendment.  This right allowed the minority or individual senators to circumvent parliamentary obstacles, namely filling the tree, to receive votes.

The question essentially will be do you want to keep the Reid Motion to Suspend precedent prohibiting Motions to Suspend the Rules post-cloture by sustaining the precedent.

Voting Yes keeps the Reid precedent

Voting No reverses the Reid precedent

If the precedent is overturned by a majority of senators voting against the ruling of the chair, the rights of senators—as written in senate rules to suspend the rules post-cloture —would be returned.

If Dr. Coburn is successful overturning the Reid precedent, he is NOT planning to follow up with another motion to allow the offering an amendment. This will be a purely procedural vote seeking to restore a right written in Senate Rules.

This document provides an overview of the history leading up to this precedent and outlines the motion Senator Coburn will offer to attempt to reverse it and restore the right provided by Senate rules.

Majority Leader Blocking Amendments by “Filling the Tree”

  • The distinguishing characteristics of the Senate are the right to offer amendments, and the right to debate. 
  • Throughout his tenure, Senate Majority Leader Harry Reid has aggressively deployed a tactic to block other senators from offering amendments to legislation.  This tactic, known as “filling the tree,” fills all available slots for amendments with shell legislation, preventing all other senators from offering amendments. 
  • Senator Reid has deployed the “filling the tree” maneuver over 90 times during his tenure as Majority Leader.  To put this number in perspective, Senator Reid has filled the amendment tree more than all the other Majority Leaders combined between 1985 and 2006 (40 times).
  • This tactic effectively shuts out every individual member of the Senate from offering input on legislation.

Senators Resort to Motions to Suspend the Rules Offer Amendments

  • Starting in 2010, as Senator Reid continued to use the “filling the tree” maneuver, senators in both parties resorted to other procedural options to assert their rights as senators.
  • Under Rule V of the Standing Rules of the Senate, the other rules may be suspended, including blocking amendments by “filling the tree.”
  • From 2010 until October 6, 2011, senators filed more than 30 notices and the Senate held more than 15 votes to suspend the rules to allow amendments to be offered during post-cloture debate.

Reid Precedent Breaks the Rules to Eliminate Senators’ Right to Suspend the Rules   

  • On October 6, 2011, the Senate Majority Leader changed Senate rules with a simple majority rather than the required two-thirds vote, ending the right of senators to suspend the rules post-cloture.
  • Senator Reid called up a motion to suspend the rules that had been filed the previous day by Senator Coburn.  Senator Reid made a point of order that this single motion to suspend was dilatory under Rule XXII.
  • The presiding officer correctly ruled the post-cloture amendment was not dilatory under Rule XXII.  A single motion to suspend the rules cannot be considered a delaying tactic.  Senator Reid’s point of order was not sustained.
  • Senator Reid than appealed the ruling of the chair, and held a vote to overturn it.  By a simple majority vote (51 to 48), the chair’s decision was overturned.  Every Republican and one Democrat voted against this appeal, instead voting to uphold the presiding officer’s decision which reflected the written rules of the Senate.
  • This vote established a new precedent making it out of order to offer post-cloture motions to suspend the rules despite such right being explicitly provided under Senate rules.
  • Two years later on November 21, 2013, the majority further weakened the Senate when 52 Democrat senators voted to override Senate rules that require the president’s nominees to be approved by three-fifths of the Senate before confirmation, reinforcing the dangerous trend started in 2011.  The vote to nullify the 2011 decision will not reverse this precedent.

Reversing the October 6, 2011 Reid Precedent

  • In order to overturn this precedent, a senator must offer another post-cloture motion to suspend the rules for the purpose of considering an amendment.
  • The presiding officer will likely rule that the motion is not in order based on the 2011 precedent.
  • At that point, the senator offering the motion will appeal the ruling of the chair, on the basis that a single motion to suspend the rules post-cloture is not dilatory.  The senator would then ask for the yeas and nays.
  • If a simple majority of senators vote to overturn the decision of the chair, the precedent will be reversed, restoring the right explicitly provided in the rules that allows senators to offer motions to suspend the rules post-cloture as before.

 The roll call and Congressional Record from October 6, 2011 is here.

Prevention of veteran suicides should be among the foremost of VA’s goals, and Congress should be performing aggressive oversight to ensure existing programs and authorities are striving to this end.

H.R. 5059 creates a number of new programs at the VA and $22 million in new federal spending.  In almost every case, VA already has the tools and authorities it needs to address these problems.  The department needs leadership, not another piece of ineffective legislation. Congress should be holding the VA accountable rather than adding to its list of poorly managed programs.  The VA has proven that questions need to be asked before it is entrusted with the lives of veterans or the money of taxpayers.

Rajiv Jain, the Veterans Health Administration's assistant deputy undersecretary for health for patient care services, told members of the House Veterans' Affairs Committee last month that while the department supported the goals of the bill, the legislation overlaps with existing programs. 

Further concerns with the legislation can be viewed here.

“To know how to reach a destination, you must first know where you are. Without oversight -- effective, vigorous oversight -- you'll never solve anything. You cannot write a bill to fix an agency unless you have an understanding of the problem. And you can only know this by conducting oversight, asking the tough questions, holding the bureaucrats accountable, find out what works and what doesn't and know what has already been done. Effective oversight is an effective tool to expose government overreach and wasteful spending, but it also markedly exposes where we lose our liberty and our essential freedoms. True debates about national priorities would come about if we did effective oversight. It is the senate, once hailed as the world's greatest deliberative body, where these differences should be argued. Our differences should be resolved through civil discourse so they're not settled in the street. Just as the constitution provides for majority rule in our democracy while protecting the rights of the individual, the senate must return to the principles to gain the trust of the electorate. And it can.” – Dr. Coburn

Watch his full speech here.

Read the transcript here.

As Washington politicians rush to pass another end of the year bill extending billions of dollars in tax breaks for special interests, a new report highlights over $900 billion of giveaways throughout the tax code.

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More than 165 tax expenditures worth over $900 billion this year and more than $5 trillion over the next five years are revealed in Tax Decoder, a new report decoding the tax code.

Gamblers who lose at the casino or horse track can still win on their tax return by writing off gambling losses. Hollywood movie makers aren’t just collecting at the box office, they are also downloading tax subsidies from the IRS. There is no shortage of tax subsidies for the rich and famous, such as credits to renovate vacation homes and purchase luxury cars and deductions for yachts. 

Ideally, Congress would throw out the entire tax code and start over, but at the very least the code should be made simpler, fairer and flatter. This report provides a list of options for Congress to streamline and simplify the tax code to achieve that goal. While many of the tax breaks identified throughout this report should be phased out or eliminated, others could also be reformed to better achieve their intended purpose.

Read the full report here.

Read the introduction here.

Read the highlights here

The Tax Decoder highlights reel features Lady Gaga, Starbucks, IHOP and other tax subsidies for the rich and famous. Watch it here

Examples of just a few of the tax preferences highlighted in Tax Decoder include:

  • Billions of dollars in tax breaks go to wealthy pro sports team owners, who can count the roster of players as a depreciable asset.
  • The Tuna Tax Break provides nearly $10 million to certain domestic corporations operating in American Samoa.
  • Tax credits for historic and nonhistoric structures result in lost revenue of $1 billion annually, subsidize beach front resorts, Major League Baseball stadiums, and luxury hotels.
  • Ani DiFranco, a Grammy award winning artist, took advantage of $1.5 million in historic preservation tax credits and $3.7 million in New Market Tax Credits to build her Righteous Babe record label headquarters.
  • Many charities give little to their cause, despite paying no taxes. For example, Lady Gaga’s 501(c)(3), the Born This Way Foundation, raised $2.6 million in 2012, but only gave away $5,000 for “grants to organizations or individuals.”
  • For FY 2014, the tax gap will likely be about $500 billion.  If this amount were fully paid, virtually the entire deficit currently projected for FY 2014, $483 billion, could be eliminated.  

Dr. Coburn sent a letter opposing the inclusion of a public lands package in the unrelated National Defense Authorization Act. This would be the largest park expansion in a single measure by Congress since 1978, despite an unsustainable $12 billion deferred maintenance backlog in our existing National Park System. Read the letter here.

Dr. Coburn released a report documenting how Congress has used the National Park Service to advance parochial interests while failing to keep our existing commitments to America’s national treasures. Read the full report here.

November 2014

(WASHINGTON, D.C.) –Due to a lack of transparency, some health providers may be charging double, triple, or more what another provider down the road charges for the same procedure—resulting in higher out of pocket costs for patients— according to a new report by the Government Accountability Office (GAO) requested by Sens. Coburn, Klobuchar, Shaheen, and Toomey.  The GAO also found significant weaknesses in the Centers for Medicare and Medicaid Services (CMS)’ price and quality transparency tools for consumers.  As a result, it can be nearly impossible for patients to obtain information on the cost and quality of health care prior to a procedure, causing some patients to spend more on health care without receiving better care.

U.S. Senator Tom Coburn, M.D. (R-Okla.) released the following statement:

“Transparency in the cost and quality of health care is crucial in creating a competitive market to improve health outcomes while driving down costs for patients. The innovative Surgery Center of Oklahoma, for example, posts the prices of procedures on their website so that consumers can make informed decisions on their health care. Patients come to the surgery center from all over the country and Canada because of the high quality care they provide at a lower cost. Unfortunately, the GAO report reveals that CMS is failing to provide similar transparency on the cost and quality of health care. Congress should call on CMS to improve their transparency tools, allowing consumers to compare providers based on out-of-pocket costs, patient-reported outcomes, and the combination of cost and quality information.”    

You can read the entire report here.

 

WASHINGTON – House Oversight and Government Reform Committee Chairman Darrell Issa (R-CA), Sen. Tom Coburn (R-OK), and Rep. Phil Gingrey (R-GA) today released a report they requested from the U.S. Government Accountability Office (GAO) examining the use of “official time” for union business at government agencies. Official time is when a federal worker stops performing the job for which they were hired and instead engages in union activity, at taxpayer expense. The report, titled, “Labor Relations Activities: Actions Needed to Improve Tracking and Reporting of the Use and Cost of Official Time,” includes The Office of Personnel Management’s (OPM) admission that official time reporting is not a priority, raises questions about OPM’s methodology for collecting data on official time, and shows the amount of official time could be as much as $5 million higher for the agencies studied. While OPM estimated that the federal government spent more than $156 million during fiscal year 2012 on official time, GAO estimated the cost of official time to be 15 percent higher than OPM estimates at 4 agencies.

“This study shows that the federal government is falling short in keeping track of so-called ‘official time’ and must make changes to prevent underreporting,” said Chairman Issa. “Taxpayers have the right to know the true cost of the union activity they are funding.”

Sen. Coburn said, “With veterans literally dying waiting to see a doctor, VA staff should be focused on fulfilling the promises made to America’s heroes rather than on performing union duties to secure greater benefits for themselves.”

“GAO’s report confirms that more work needs to be done to ensure transparency and accountability when reporting official time,” said Rep. Gingrey. “As long as taxpayers are forced to subsidize union activity, they should—at the minimum—have access to reliable data that shows where their hard-earned money is being spent. It is past time for the federal government to make American families—not Big Labor—its priority.”  

You can read the entire report here. 

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October 2014

(WASHINGTON, D.C.) – U.S. Senator Tom Coburn, M.D. (R-Okla.), Ranking Member of the Homeland Security and Government Affairs Committee, released the following statement regarding the White House cyber intrusions reported Tuesday:

“I’m deeply concerned about the reported attacks on White House networks.

“We’ve worked very closely with the administration to improve our nation’s cybersecurity. This year, Chairman Tom Carper and I came together to craft legislation, the Federal Information Security Modernization Act (S. 2521) to help secure federal networks from these sorts of attacks. We included the White House in our negotiations, to make sure we got it right.

“So I’m disappointed that the White House decided not to notify Congress of the breach, even as its officials debated with my staff the need for agencies to tell Congress when they’ve been hacked.

“I have pressed the administration to share details about what has happened and how the attack succeeded. I have yet to receive satisfactory answers. Let us seize this opportunity to work together to protect against this very serious threat to our national security and economy.”

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Voodoo Dolls, Gambling Monkeys, Zombies in Love and Paid Vacations for Misbehaving Bureaucrats Top List of the Most Outlandish Government Spending in Wastebook 2014

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Gambling monkeys, dancing zombies and mountain lions on treadmills are just a few projects exposed in Wastebook 2014 – highlighting $25 billion in Washington’s worst spending of the year.

Wastebook 2014 — the report Washington doesn’t want you to read —reveals the 100 most outlandish government expenditures this year, costing taxpayers billions of dollars.

“With no one watching over the vast bureaucracy, the problem is not just what Washington isn’t doing, but what it is doing.” Dr. Coburn said. “Only someone with too much of someone else’s money and not enough accountability for how it was being spent could come up some of these projects.”

“I have learned from these experiences that Washington will never change itself. But even if the politicians won’t stop stupid spending, taxpayers always have the last word.”

Congress actually forced federal agencies to waste billions of dollars for purely parochial, political purposes.

For example, lawmakers attached a rider to a larger bill requiring NASA to build a $350 million launch pad tower, which was mothballed as soon as it was completed because the rockets it was designed to test were scrapped years ago. Similarly, when USDA attempted to close an unneeded sheep research station costing nearly $2 million every year to operate, politicians in the region stepped in to keep it open.

Examples of wasteful spending highlighted in “Wastebook 2014” include:

  • Coast guard party patrols – $100,000
  • Watching grass grow – $10,000
  • State department tweets @ terrorists – $3 million
  • Swedish massages for rabbits – $387,000
  • Paid vacations for bureaucrats gone wild – $20 million
  • Mountain lions on a treadmill – $856,000
  • Synchronized swimming for sea monkeys – $50,000
  • Pentagon to destroy $16 billion in unused ammunition -- $1 billion
  • Scientists hope monkey gambling unlocks secrets of free will –$171,000
  • Rich and famous rent out their luxury pads tax free – $10 million
  • Studying “hangry” spouses stabbing voodoo dolls – $331,000
  • Promoting U.S. culture around the globe with nose flutists – $90 million

Read the full report here.

Watch the Wastebook 2014 videos here and here and here

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WASHINGTON –According to a recent report by the Government Accountability Office (GAO), the Department of Defense (DOD) spent tens of millions of dollars in unnecessary returns of surplus vehicles from Afghanistan to the United States during a one year period. Today, a bipartisan group of Senators on the Committee on Homeland Security and Governmental Affairs highlighted the report findings.

The report, Afghanistan Equipment Drawdown: Progress Made, but Improved Controls in Decision Making Could Reduce Risk of Unnecessary Expenditures (GAO-14-768), found that during a one-year period, the United States Army and Marine Corps returned more than 1,000 military surplus vehicles from Afghanistan to the United States, even though the vehicles were not determined to be needed and therefore should not have been returned. The cost of returning a vehicle to the U.S. is upwards of $100,000 per vehicle - for a total cost as high as $100 million in unnecessary shipments during the period of time examined by GAO. The vehicles in question were no longer needed by the military. The report found that if the Army and Marine Corp had followed Department of Defense proper rules and procedures, the services would have either transferred the surplus vehicles to appropriate overseas allies or scrapped the vehicles in Afghanistan, saving a significant amount of money in logistical and shipping costs.

Senator Carper, Chairman of the Committee on Homeland Security and Governmental Affairs:“This report is a troubling reminder that the Department of Defense has more work do in managing taxpayer dollars. The Government Accountability Office underscores that the DOD can and should do a much better job in preventing unnecessary costs by taking some common sense steps in managing its surplus military vehicles. We simply cannot afford this type of waste and ineffectiveness. Given the tremendous fiscal challenges our government faces, we have an obligation to look in every nook and cranny of our budgets for savings. I believe this is an area where simple yet effective improvements can be made to achieve better results for less money.”

Dr. Coburn, Ranking Member of the Committee on Homeland Security and Governmental Affairs:“Until DOD leadership gets serious about financial management and fundamentally changes the way the Department manages its business and holds itself accountable, Americans will continue to see DOD waste scarce taxpayer dollars. Despite the Department’s assurances that it is making progress and working hard to be better stewards of taxpayer dollars, we see examples like this time and again. Especially in this budgetary environment, actions matter more than empty promises.”

Senator McCaskill, Chairman of the Subcommittee on Financial and Contracting Oversight: “At a time when we’re turning over every rock to find savings for taxpayers—and while we’re engaged in a national conversation about the use of military equipment at home—this kind of waste is unacceptable. I expect military leaders to take these findings seriously and do better.”

Senator Tester, Chairman of the Subcommittee on Efficiency and Effectiveness of Federal Programs and the Federal Workforce: “This issue deserves the highest level of attention and oversight,” Tester said. “While I understand the Defense Department is operating under intense time and budget pressures, we must use common-sense when it comes to spending taxpayer dollars – especially when Americans have already paid a steep price for this conflict.”

September 2014

(WASHINGTON, D.C.) – The federal government underreports cost savings from federal data center consolidation by billions of dollars, according to a new report by the Governmental Accountability Office (GAO).

The Federal Data Center Consolidation Initiative (FDCCI) is a government-wide effort to reduce the number of redundant data centers, which have grown from several hundred in the late 1990s to nearly 10,000 today.

According to the GAO report, agencies have struggled to accurately calculate the amount of savings they have and will achieve through data center consolidation. Further, GAO found that agencies are underreporting their FDCCI savings to the Office of Management and Budget (OMB), forcing OMB to underreport the total savings to Congress. 

The report found that consolidation would lead to savings of $3.1 billion through next year. However, the amount agencies have reported to OMB for the same time period is $876 million, meaning total savings have been underreported to OMB by approximately $2.2 billion. The Department of Defense (DOD) has also significantly scaled back its earlier planned savings estimates, from $4.7 billion through FY 2017 to $2.6 billion.

GAO estimates that consolidating federal data centers could save over $5 billion through Fiscal Year (FY) 2017 and over $10 billion in later years. However, until agencies improve their reporting practices and OMB assists agencies in calculating savings, agencies will continue to have difficulty measuring progress toward cost-savings goals, the report found.

“Vast amounts of taxpayer savings can be achieved by consolidating the thousands of redundant data centers operated by the federal government. While progress has been made, this report makes clear that more can be done to achieve significant savings,” Dr. Coburn said. “It is also important to get the numbers right. Improving transparency will better allow agencies to gauge their progress and help Congress hold them accountable. I am pleased the Senate recently passed the Federal Data Center Consolidation Act to address GAO’s recommendations.”

“The Administration’s Federal Data Center Consolidation Initiative is an ambitious challenge that is worth meeting – and today’s report from the Government Accountability Office underscores its potential,” said Senator Carper, Chairman on the Senate Committee on Homeland Security and Governmental Affairs. “This report shows that agencies are achieving significant cost savings and taking innovative steps to trim the federal government’s massive information technology portfolio – saving billions of taxpayer dollars in the process. That being said, the report also underscores the critical need for agencies to improve reporting. As the saying goes, you can’t manage what you can’t measure. Without accurate tracking and reporting of performance measures, we run the risk of not achieving the full potential savings. This means it is critical that the Office of Management and Budget and agencies continue to improve their process for reporting, tracking and measuring progress on this initiative. Along with this, I will continue to work closely with my colleagues in the Senate and House on bipartisan legislation that will address the necessary updates and upgrades to the federal government’s information technology management.”

GAO recommends that OMB assist agencies in reporting their cost savings. In addition, GAO recommended that OMB improve its standardized metrics so that agencies can better measure their progress. Last week a bipartisan bill passed the Senate that would address many of the issues GAO has raised in its series of reports, including requirements for improved reporting practices and standardized cost-savings metrics.

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(WASHINGTON, D.C.) – A recent Washington Post article identified employee turnover and poor morale as challenges at the Department of Homeland Security that will prevent DHS from achieving its mission of securing the nation. Senator Tom Coburn (R-OK) reiterated his confidence in Homeland Security Secretary Jeh Johnson and urged patience in allowing the Secretary time to change the culture within the Department. 

“Few members of Congress have raised more questions about the Department and its programs than I have,” commented Dr. Coburn, ranking member of the Senate Homeland Security and Governmental Affairs Committee. “But I have the utmost confidence in Secretary Jeh Johnson’s ability to lead and reform the Department. You cannot fix problems that have developed over many years overnight, and the Secretary deserves our patience as he works to change the culture at DHS.”

“Over the past year, we have seen positive steps at DHS, including efforts to strengthen management and coordination among the Department’s many components and offices. We have also seen Sec. Jeh Johnson take decisive actions to fix problems and curb waste within DHS, such as abusive overtime practices. Some of those decisions may be unpopular but they are the right thing to do,” Dr. Coburn continued. 

One of the challenges identified in the Washington Post report was vacancies in key leadership positions within DHS. Led by the Senate Homeland Security and Governmental Affairs Committee, the Senate has confirmed 9 key DHS nominations since Sec. Johnson’s confirmation. “With very few exceptions, our committee has supported the President’s nominations for DHS with broad, bipartisan support. We are working hard to give Secretary Johnson the senior leadership team he needs. Changing the culture within a bureaucracy is always a challenge and to do it successfully requires real and committed leadership which I believe Jeh Johnson is providing. Congress needs to play its part through oversight to assist the Secretary to identify areas that need improvements and pass bills to give him the authority to make the necessary changes, such as reducing unnecessary duplication or adding measurable outcomes and performance goals.”

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(WASHINGTON, D.C.) – The Department of Homeland Security (DHS) and the General Services Administration (GSA) have not updated or revised a plan to ensure that the $4.7 billion DHS consolidation project at St. Elizabeths makes operational and fiscal sense, a new report from the Government Accountability Office (GAO) concludes. The St. Elizabeths campus is the location in Southeastern DC where DHS has planned to construct a consolidated headquarters.  It currently houses the U.S. Coast Guard.

Identifying the challenge of funding realities and changing workplace standards, the GAO report raises questions about the long-term viability of the project. Pending the development of reliable cost and schedule estimates, the project risks further potential cost overruns, missed deadlines, and performance shortfalls.

“Taxpayers have invested more than $1.5 billion in the DHS headquarters consolidation project at St. Elizabeths. It is disappointing that we don’t yet have a detailed and viable plan for the consolidation. DHS needs to present us with a realistic plan for consolidating its operations while also saving tax dollars by closing some of its leased facilities across the region,” said Dr. Tom Coburn, ranking member of the Senate Homeland Security and Governmental Affairs Committee.

The report raises questions about the long-term viability of the project, and GAO recommends that Congress consider making future funding for the project contingent upon DHS and GSA developing a clear plan and schedule for its completion. 

“I strongly support GAO’s recommendations,” commented Dr. Coburn. “Any new funding for the headquarters consolidation should be halted until DHS develops a revised plan for the further development and occupation of the campus. 

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Washington, DC – The U.S. Senate last week passed a bipartisan bill to expedite the consolidation of federal data centers that could save up to $3 billion in taxpayer dollars. The bill sets hard deadlines and requires federal agencies that have yet to act on consolidation initiatives to conduct inventories and implement consolidation strategies. In addition, the law would require the Government Accountability Office (GAO) to verify agency data center inventories, and would direct the Office of Management and Budget (OMB) to routinely report to Congress on cost savings realized to date.

The Federal Data Center Consolidation Act was introduced by U.S. Senators Michael Bennet (D-CO), Tom Coburn (R-OK), and Kelly Ayotte (R-NH) in October 2013. Senate Homeland Security and Government Affairs Chairman Tom Carper (D-DE) joined the effort and helped usher the bill through the committee last November.

“This bill represents a smarter, more efficient way to operate government and save taxpayer dollars. It will also reduce the federal government’s energy consumption across the country,” Bennet said. “OMB set ambitious but achievable goals that federal agencies are not on track to meet. We’re proposing to hold them accountable in these efforts.”

“The Federal Data Center Consolidation Act builds upon OMB’s efforts to reduce duplication in federal data centers. GAO has described this legislation as ‘essential’ to ensuring agencies make adequate progress in consolidating their data center inventories and saving taxpayers money,” Dr. Coburn said. “The bill is a crucial component in our efforts to reform the way the federal government acquires and manages IT.”

“The Administration’s Federal Data Center Consolidation Initiative is an ambitious challenge that is worth meeting. While evidence shows a major shift in the way the federal government thinks about and pursues IT management in its operations, it’s clear that some agencies have more work to do,” Chairman Carper said. “We need to salute the success stories and push those agencies that have fallen short to work harder. This measure is part of a larger effort to improve our federal government’s IT management and will help agencies focus their efforts on consolidation, better manage their inventories, and ensure that the Administration’s Consolidation Initiative is seen through to its conclusion. I want to thank Senators Coburn, Bennet, and Ayotte for their work on this important issue.”

“With over $17 trillion in debt, there’s no excuse to continue to spend millions on wasteful and unnecessary federal data centers – some of which are utilizing only a fraction of their capacity,” said Ayotte. “I’m pleased that the Senate passed our bipartisan bill, which will save taxpayer dollars by speeding up consolidation and increasing the efficiency of data centers across government.”

A number of studies have shown a relatively low utilization rate of the current IT infrastructure, resulting in an enormous amount of wasted space and energy – and unnecessary costs. In 2010, the Office of Management and Budget (OMB) instructed federal agencies to develop consolidation plans under the administration’s Federal Data Center Consolidation Initiative (FDCCI), which could save up to $3 billion by 2015, according to the GAO, with additional savings beyond that date. However, the GAO also found that a number of agencies have been slow to implement these plans – or, in some cases, to even inventory the total number of data centers they currently manage.

The GAO has publicly endorsed the legislation, saying it is vital to ensure that agencies close down unnecessary data centers by the target deadline. The senators have worked closely with OMB and GAO to ensure that this bill will help strengthen the initiative and achieve meaningful savings.

The bill is also supported by the Professional Services Council and the Information Technology Industry Council.

The lawmakers previously filed the bill as an amendment to the Energy Savings and Industrial Competitiveness Act of 2013 and to the FY 2014 National Defense Authorization Act.

###

 

Last night, the Senate approved legislation to curb millions of dollars in improper payments to deceased individuals. The Improper Payments Agency Cooperation Enhancements Act (IPACE), introduced by Homeland Security and Governmental Affairs Committee Chairman Tom Carper (D-Del.) and Ranking Member Tom Coburn (R-Okla.) is bipartisan legislation that builds upon Chairman Carper’s existing improper payment laws, enacted in 2010 and 2012.

“All too often, we hear stories of criminals taking advantage of  basic errors in the way our government maintains and shares death records,” said Chairman Carper. “Not only do these types of errors waste millions of taxpayer dollars annually, but they also undermine confidence in our government. That’s frankly unacceptable. This bill fixes this problem by implementing some basic reforms. It ensures that federal agencies keep track of people who have died, shares that information, and ultimately prevents payments to people who are obviously no longer eligible for federal benefits and payments. By taking some long overdue and common sense steps like providing federal agencies with access to the most complete and accurate list of people who have died, we can put an end to this unacceptable practice once and for all. I thank my Senate colleagues for supporting this legislation and urge my House colleagues to support its passage.”

“It is inexcusable that in the 21st century, one federal agency doles out money to individuals that another federal agency knows to be deceased,” said Dr. Coburn. “Errors like this cost taxpayers millions of dollars and this bill will bring much needed transparency to ensure that deceased individuals are no longer receiving federal benefits.”

This legislation comes after a Homeland Security and Governmental Affairs Committee in May 2013 that examined initiatives by the Executive Branch to reduce the improper payments made by federal agencies. The hearing examined improper payments to deceased individuals, often due to inadequate sharing among federal agencies of basic death data maintained by the Social Security Administration (SSA). Most federal agencies rely on a slimmed down, incomplete, and less timely version of the death data that is also available to some private sector and public entities. IPACE will correct these problems by making the following changes:

  • Allow Federal Agencies Access to the Complete Death Database.  Under current law, only some agencies may have access to the complete death data.  IPACE allows all appropriate federal agencies to have access to the complete death data for program integrity purposes, as well as other needs such as public safety and health.  The substitute includes a “sunset” of this provision after five years.
  • Require Use of Death Data to Curb Improper Payments.  IPACE would require that federal agencies make appropriate use of the death data in order to curb improper payments.
  • Improve the Death Data.  The legislation establishes procedures to better facilitate the sharing of death data among federal agencies, such as death information from the Department of Defense, which records some deaths overseas.

###

(WASHINGTON, D.C.) – Today, U.S. Senators Tom Coburn (R-OK) and Mazie Hirono (D-HI) introduced S.2852, the State Regulatory Representation Clarification Act of 2014 which would clarify Congressional intent that the Board of the Federal Deposit Insurance Corporation (FDIC) should include at least one individual who has worked as a state bank regulator.

“Washington does not always know best, and it is important that Congress reaffirms and clarifies its intent that the FDIC will benefit from the view of those with firsthand experience regulating the banking industry at the state level,” Dr. Coburn said. “Our financial regulatory framework needs multiple perspectives, and the state bank regulatory perspective is a critical ingredient in that mix.”

“Hawaii families and businesses face unique circumstances and rely on local banks and credit unions that understand those circumstances to help them buy new homes or get a loan to start a new business,” said Hirono. "In fact, seven of the twelve banks in Hawaii are state chartered, accounting for 84 percent of the small business loans made in the state. It is important that people who understand the  perspective of community banks and how they serve different communities are represented on the FDIC board.”

We know the consequences of an assumption that all good ideas come from Washington. State banking regulators bring an essential point of view to local credit markets and the role of banks in communities throughout the country.

###

Enumerated Powers:

As a family physician, Dr. Coburn understands the importance of quality child care and early education, and the need to ensure that children are cared for in a secure environment where they can grow and learn. However, it is not the proper role of the federal government to oversee child care or education. The U.S. Constitution does not give the federal government any authority or role in these matters.

Increased Funding:

The new mandates in this bill would cost an additional $1.2 billion in order to continue serving the same number of families.  The added expense to taxpayers is not offset through reductions in spending elsewhere.

Duplication:

In a February 2012 report, the Government Accountability Office (GAO) found the federal government is currently administering 45 programs to provide or support child care and related services to children from birth through age five, as well as several tax credits to subsidize private expenditures for early learning and child care. The programs operate under numerous departments including the Departments of Agriculture, Interior, Justice, Labor, Housing and Urban Development, the General Services Administration, and the Appalachian Regional Commission. The Temporary Assistance for Needy Families (TANF) block grants given to states also provide funding for child care programs.

Misguided Mandates:

The bill restricts a state’s frequency of income checks to once every year rather than every six months.  States should not be restricted from trying to keep their programs restricted to those truly in need by performing income checks more than once a year.  States have created solutions to ensure families are not adversely affected by these checks (such as sudden drop-offs from the program), and they can remain accountable for the success of their programs.

The bill places new requirements on states for their health, safety, and fire inspections of all child-care providers before licensing and annually thereafter.  Most states already conduct these inspections.  This provision will require an additional $35 million per year to implement, according to the Congressional Budget Office.

(WASHINGTON, D.C.) – Reducing Crop Insurance subsidies for America’s wealthy farmers could save hundreds of millions annually for taxpayers, according to a new report from the Government Accountability Office (GAO). GAO’s report examined the effects of reducing the federal subsidy for crop insurance revenue policies, and found possible savings of nearly $2 billion per year with little effect on farmers’ total production cost per acre.

“This report provides us a blueprint on how to save hundreds of millions of dollars with little impact on our farm industry.” Dr. Coburn said. “The Federal Government needs to get out of the business of subsidizing the wealthiest farmers.”

GAO’s report notes that the cost to the federal government of the crop insurance program increased from an average of $3.4 billion per year from 2003 through 2007 to an average of $8.4 billion per year from 2008 through 2012, peaking at $14.1 billion in 2012, a new record. During this time period, the rate of premium subsidies provided by the federal government increased from 37 percent to 63 percent and the amount of acreage covered by the program increased dramatically, all while the farm industry was bringing in record profits.

The GAO report also found median farm household income was significantly higher than median income for all U.S. households in 2012. While the median income for all U.S. households was $51,017, households associated with farms specializing in cash grains such as corn or soybeans had a median household income of about $82,300 and farms specializing in a few choice crops (rice, tobacco, cotton, and peanuts) netted a median income of $101,400. Success does not need a government subsidy.

###

Prompted by the surprisingly militarized police response to protests and civil unrest in Ferguson, Missouri, last month, the Senate Homeland Security Committee is holding a hearing to examine the federal programs which have helped state and local law enforcement equip themselves with paramilitary weaponry, equipment and vehicles. Additional information is here.

August 2014

WASHINGTON, D.C. — Today the Oklahoma delegation criticized the Obama Administration for failing to approve a one-year extension of Oklahoma’s Elementary and Secondary Education (ESEA) Flexibility:

"The Obama Administration doesn't like when Oklahomans buck big government regulations, and today the Administration responded by penalizing our children with failing to grant the one-year extension of the ESEA flexibility," said Sen. Jim Inhofe."Oklahomans want education reform that sets standards created and certified by Oklahoma's institutions, community leaders, and parents. Instead of supporting these values, the Obama Administration has chosen to make it more expensive and difficult to achieve the state's education goals that, once met, will exceed the requirements set by the U.S. Department of Education. As seen with ObamaCare taxes or the Endangered Species Act rulings, today's decision continues the trend of this Administration punishing Oklahoma for making decisions that represent the goals and interests of its constituents." 

“Greater state and local control over education funding is vital to the success of Oklahoma's students,” said Sen. Tom Coburn. “The experiment in federal micro-management of our nation's schools has proven to be a failure. This is what makes the Secretary's decision to revoke Oklahoma's ESEA flexibility so disappointing. As Oklahoma takes concrete steps to ensure our students are prepared for their future careers, the Department should give our schools the flexibility they need to succeed.”

“The revocation of Oklahoma’s NCLB waiver—just as students begin a new school year—demonstrates this Administration’s unwillingness to allow states the time to establish state-specific, high academic standards,” said Rep. James Lankford. “The Administration granted an education funding waiver if Oklahoma would accept Common Core or if our state would establish college-ready standards. In May, our state chose to reject the Common Core standards and began writing our own. Because of that decision, the Administration has chosen to revoke what little flexibility and clarity Oklahoma educators were allowed by the federal government to help our students and teachers succeed amid a one-size-fits-all federal approach to education policy. The actions of the Administration today increase bureaucracy and decrease time to focus on academic standards.  

“This is a glaring example of why the federal government should not dictate local education policy. In July of last year, the U.S. House passed an Elementary and Secondary Education Act (ESEA) reauthorization to protect local schools from new federal red tape and to provide school districts the flexibility to identify, recruit and retain the best teachers possible. Centralized, federally mandated curricula, inside-the-Beltway education funding priorities and impossible federal standards are not the answers to improve education in our nation.”

“Our state stood firm against further federal intrusion into the education of our children by rejecting the Common Core curriculum and determining that local educational leaders could best develop the appropriate curriculum for Oklahoma students,” said Rep. Jim Bridenstine. “Instead of applauding this constitutional decision and leadership, the Obama Administration decided today to reject the requested one year extension of flexibility previously granted to Oklahoma under ESEA. This politically motivated decision is the perfect example of how the unconstitutional federalization of education has effectively taken away the power reserved for the states and the people by our founders. It's time to abolish the federal Department of Education and return power to the states consistent with the 10th Amendment.”

“I'm very frustrated by this decision not just as an Oklahoma Representative but also as a parent with children in public school,” said Rep. Markwayne Mullin. “Like many Oklahoma families, my family depends on public education, and this irresponsible action promises to weaken our state's ability to provide our youth with the education they need to be successful.” 

"Oklahoma's educators deserve maximum flexibility in order to provide our students with the tools to succeed,” said Rep. Frank Lucas. “Today's decision reflects just how out of touch the Obama Administration is when it comes to the needs of Oklahoma's students, and I urge the President to reconsider extending this critical education measure."

"Although the waiver was not granted, I hope that the Department of Education works with the state to ensure a smooth transition,” said Rep. Tom Cole. “Changing the standards for a school year that has already begun is untenable and will not only be rushed but will likely be difficult to implement. I am disappointed that the Administration would cause such an unfair strain on the system in Oklahoma."

On Aug. 25, the Oklahoma Delegation sent a letter to the Secretary of the U.S. Department of Education Arne Duncan requesting the agency to consider a one-year extension of Oklahoma’s Elementary and Secondary Education Act (ESEA) Flexibility. The extension would allow for Oklahoma to continue developing elementary and secondary education standards in conjunction with institutions of higher education in order to meet and exceed the U.S. Department of Education’s requirements. 

The Delegation wrote, “On behalf of the State, we request that Oklahoma be afforded this one-year extension of the ESEA Flexibility in order to allow state leaders and educators the opportunity to focus on the development and implementation of Oklahoma college- and career- ready standards, as well as other State education reforms necessary to continue supporting the Principles of ESEA Flexibility.”

You can read the full text of the letter by clicking here

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(WASHINGTON, D.C.) – A new federal regulation would allow temporary federal employees to qualify for health coverage more quickly, but may violate current law which excludes temporary employees from receiving health benefits before one year of current continuous employment. U.S. Senator Tom Coburn, M.D. (R-OK) sent a letter to Director Archuleta, head of the Office of Personnel Management (OPM), expressing his concerns and raising questions of the legality with the proposed rule. The text of the letter is below:

August 28, 2014

Katherine Archuleta

Director

Office of Personnel Management

1900 E Street, N.W.

Washington, DC 20415-1000 

Docket No.: 2014-17806 

Dear Director Archuleta: 

I am concerned about the July 29, 2014, proposed rule providing for health benefits for some temporary federal employees.  

This rule would allow certain types of temporary, seasonal, and intermittent federal employees to qualify for health coverage under the Federal Employees Health Benefits Program (FEHBP).  Eligible workers would also receive a full government contribution towards their premiums.  Avoidance of the penalty under the employer mandate of the Patient Protection and Affordable Care Act appears to be a key reason the Office of Personnel Management (OPM) is moving forward with the proposal.  The proposed rule discusses at length how the federal government will be subject to the mandate’s penalty if any full-time worker receives a subsidy for health insurance through an exchange.  

I am concerned the proposed rule may be inconsistent with current federal law, which appears to prohibit eligibility of temporary employees for both the FEHBP and full government contribution under the conditions you established.  

First, the proposed rule would allow temporary employees to qualify for the FEHBP after a 90-day waiting period, even though federal law only provides for eligibility after “1 year of current continuous employment, excluding any break in service of 5 days or less.”[1]  Only under these conditions can OPM “prescribe regulations to provide for offering health benefits plans to temporary employees.”[2]  

Second, the proposed rule would allow the government to make a full contribution to the premiums for such FEHBP coverage, even though federal law states, “[T]he employing agency of any such temporary employee shall not pay the Government contribution under the provisions of section 8906.”[3]

Ironically, OPM reaffirms these policies in the background of the proposal: “Currently, most employees on temporary appointments become eligible for FEHBP coverage after completing one year of current continuous employment and, once eligible for coverage, do not receive an employer contribution to premium” (page 43969). 

Your department has previously acknowledged legal limitations of extending coverage under the FEHBP.  Before a congressional hearing in 2010, Angela Bailey (now OPM’s Chief Operating Officer) said, “[OPM] took a very good, close look at both our regulations and the law.  And the way the law is currently written, it is written in such a way that it excludes temporary employees from receiving health benefits...After 1 year, even temporary employees are eligible to apply for health benefits as long as they pay the 100 percent contribution of that” (emphasis added).[4]  From my understanding, OPM has held this view for decades.[5]

I respectfully request you submit answers to the following questions about OPM’s decision to move forward with a policy that may contradict federal law:

  1. Does OPM agree current federal law prohibits temporary employees from qualifying for health benefits coverage before one year of continuous service?  Please provide a copy of OPM’s legal analysis used to conclude this element of the proposed rule is consistent with current law.
  2. Does OPM agree current federal law prohibits temporary employees from receiving a government contribution toward the premiums for any such coverage?  Please provide a copy of OPM’s legal analysis used to conclude this element of the proposed rule is consistent with current law.
  3. Has OPM’s understanding of federal law changed since it took a “very good, close look at both [OPM] regulations and the law” [6] and concluded it had no authority to expand existing health benefits available to temporary employees?  If so, please describe which laws if any enacted since 2010 have given OPM authority to expand availability of such benefits.
  4. Please provide copies of all analyses, memoranda, and emails discussing the legality of this proposed rule. 
  5. The proposed rule states, “Once an employee is enrolled under paragraph (j) of this section, eligibility will not be revoked, regardless of his or her actual work schedule or employer expectations in subsequent years.”  Under this practice, temporary, intermittent, and seasonal employees may work significantly less than full-time and still receive coverage under the FEHBP.  Please describe how OPM expects an agency to withhold an employee’s health insurance contribution if he or she did not receive a wage sufficient to cover the employee contribution in a given pay period.
  6. Has OPM requested any legislative changes related to health benefits coverage of temporary employees in any of the last five budget requests or through other means?

I appreciate your diligence in further evaluating the legality of the proposed rule and ask you respond to this inquiry by September 30, 2014. 

Sincerely,

Tom A. Coburn, M.D.

Ranking Member

###


[1] 5 U.S.C. 8906a(a)(2)

[2] 5 U.S.C. 8906a(a)(1)

[3] 5 U.S.C. 8906a(b)(2)

[4] “Temporary Employee Practices: How Long Does Temporary Last?” Hearing before the Subcommittee on Federal Workforce, Postal Service, and the District of Columbia of the Committee on Oversight and Government Reform, House of Representatives, 111th Congress, June 30, 2010, page 34.

[5] For example, see Statement of Honorable James B. King, Director, Office of Personnel Management before the Committee on Governmental Affairs, United States Senate, on Health Care Reform and the Federal Employees Health Benefits Program, May 10, 1994. 

[6] “Temporary Employee Practices: How Long Does Temporary Last?” Hearing before the Subcommittee on Federal Workforce, Postal Service, and the District of Columbia of the Committee on Oversight and Government Reform, House of Representatives, 111th Congress, June 30, 2010, page 34.

WASHINGTON – Today, a bipartisan group of 12 lawmakers from the U.S. Senate and U.S. House of Representatives highlighted a new Government Accountability Office (GAO) report entitled, “Medicare Program Integrity: Increased Oversight and Guidance Could Improve Effectiveness and Efficiency of Postpayment Claims Reviews.”  The report, which was undertaken following a bipartisan and bicameral request to GAO, found that the Centers for Medicare & Medicaid Services (CMS) should take additional steps to improve sufficient oversight and guidance to ensure contractor compliance with CMS regulations and to prevent claim review duplication during the auditing of Medicare providers and suppliers.

CMS utilizes four types of contractors (Medicare administrative contractors, error rate contractors, recovery auditors and anti-fraud contractors) to conduct postpayment reviews of Medicare claims in an effort to control and reduce improper payments.  Each contractor has a unique role in combating improper payments. However, the lack of CMS guidance and clear requirements has resulted in duplicative work by various contractors and a lack of consistency in the communications between the contractors conducting audits and the providers/suppliers being audited. 

The provider community has raised numerous concerns about the consistency and accuracy of the audit process over the past few years and this report is the first effort to determine what steps could be taken to improve the process.  The information in this report can now be used by Congress and CMS to help make improvements and ensure more consistent oversight of both the contractors and audit process.

Key findings from the GAO report follow and a full copy of the report can be found HERE:

  • CMS’s Current Duplication Reduction Efforts are Insufficient: CMS established the Recovery Audit Data Warehouse to track recovery audit activities thereby preventing duplication of reviews.  However, the database was not designed to provide information on all possible duplication, and its data are not reliable because other postpayment contractors did not consistently enter information about their reviews. CMS has not provided sufficient oversight of these data or issued complete guidance to contractors on avoiding duplicative claims reviews.
  • Communication Between Recovery Auditors and Providers is Flawed:CMS requires auditors to include certain content in correspondence with providers, but requirements are not always clear and vary across contractor types.  Contractors vary in their compliance with their requirements. CMS’s oversight of correspondence varies across contractors, which decreases assurance that contractors consistently comply with requirements. In the correspondence reviewed, GAO found high compliance rates for some requirements, but low compliance rates for requirements about communicating providers’ rights, which could affect providers’ ability to exercise their rights. 
  • Current CMS Coordination Strategies Should be Improved: CMS has strategies to coordinate contractors’ activities; however, these strategies have not led to consistent requirements across contractor types or full coordination between contractors.

CMS concurred with the findings of the report and plans to improve CMS oversight and guidance as a result.

The report was requested by Sen. Ron Wyden (D-Oregon), Finance Committee Chairman; Sen. Orrin Hatch (R-Utah), Finance Committee Ranking Member; Sen. Tom Carper (D-Delaware), Homeland Security and Governmental Affairs Committee  (HSGAC) Chairman;  Sen. Tom Coburn (R-Oklahoma), HSGAC Ranking Member; Sen. Chuck Grassley (R-Iowa), Judiciary Committee Ranking Member; Sen. Claire McCaskill (D-Missouri), HSGAC Subcommittee on Contracting Oversight Chairwoman; Sen. Bob Corker (R-Tennessee); Rep. Fred Upton (R-Michigan), Energy and Commerce Committee Chairman; Rep. Henry A. Waxman (D- California), Energy and Commerce Committee Ranking Member; Rep. Charles Boustany, M.D. (R-Louisiana), Ways and Means Subcommittee on Oversight Chairman; Rep. John Lewis (D-Georgia), Ways and Means Subcommittee on Oversight Ranking Member; and Rep. Dianna DeGette (D-Colorado), Energy and Commerce Subcommittee on Oversight and Investigations Ranking Member.

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(WASHINGTON, D.C.) – More than 600 illegal immigrant detainees released by the Immigration and Customs Enforcement(ICE) in February 2013 have previous criminal convictions, according to a new report from the Department of Homeland Security (DHS) Inspector General. ICE released over 2,000 illegal immigrant detainees in February 2013. The report containing the findings of the investigation, conducted at the request of Senators Tom Coburn (R-OK) and John McCain (R-AZ), was released today.

“It is baffling how an agency charged with homeland security and immigration enforcement would knowingly release hundreds of illegals with criminal histories. In this single action, ICE undermined its own credibility, the rule of law, and the safety of Americans and local law enforcement,” Dr. Coburn stated. “This report provides more evidence that our nation’s immigration laws are being flagrantly disregarded. Americans need to be assured the problems within ICE that led to the dangerous release of illegal aliens will be fixed and DHS and ICE will never again violate the law by releasing known criminals into our streets.”

“This report confirms the Obama administration’s lack of coherent leadership on immigration policy,” Senator McCain said. “The safety of our border communities shouldn’t be put at risk because ICE officials decide to release detainees—many with criminal records—in order to solve their budget problems without waiting to see if they could obtain more funding.”

The Inspector General cited a number of problems at ICE that led to the detainee release, including ICE’s executive leadership’s failure to effectively communicate with the DHS Secretary and the White House about its fiscal challenges or plan to release the detainees. ICE did not notify the DHS Secretary about plans to release or prepare for the potential consequences of releasing 1,450 detainees over one weekend. The DHS Inspector General’s report warns ICE still has not developed a strategy to effectively manage its detention program.  

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A billionaire’s fantasy island, Emmy award winning producers, Goldman Sachs, Broadway music from Hollywood, Starbucks, and even dolphins benefited from a tax credit intended to help struggling communities and lower income Americans seeking new opportunities. 

“Banking on the Poor,” a new report released today by Senator Tom Coburn (R-OK) reveals the federal New Markets Tax Credit program is benefitting big banks and private investors that are claiming more than $1 billion of the credit annually. 

The program was created to spur new markets, but is instead subsidizing the same old companies and corporations in little need of taxpayer assistance, like Wall Street banks and fast-food chains and luxury hotels.  It is also providing financing for unnecessary and silly projects such as a sculpture in the desert, a vintage car museum, and doggie days cares. In at least one case, a project supported with a New Markets Tax Credit is threatening to bankrupt an entire town and eliminate jobs, including the entire police department.

“The New Market Tax Credit is a reverse Robin Hood scheme paid for with the taxes collected from working Americans to provide pay outs to big banks and corporations in the hope that those it took the money from might benefit,” stated Senator Coburn.  “When government picks winners and losers, the losers usually end up being taxpayers.  Washington should reduce federal taxes on working Americans and all business owners who create jobs by eliminating tax earmarks, loopholes, and giveaways like the New Markets Tax Credit.” 

The New Markets Tax Credit program was expected to steer private financing into low-income communities to help create jobs.  Yet, virtually every neighborhood, from Beverly Hills to the Hamptons, could qualify for the program. “As a result of the definition of qualified low-income communities, virtually all of the country’s census tracts [neighborhoods and communities] are potentially eligible for the NMTC,” according to the nonpartisan Congressional Research Service.[i]

While some of the projects are well intended, like health clinics, it is still difficult to measure if these tax expenditures are truly helping those seeking a hand up or simply subsidizing banks, corporations, and others companies that are already succeeding. 

The program duplicates over 100 other federal economic development efforts. There are at least 23 community development tax expenditures costing taxpayers over $10 billion annually and 80 overlapping discretionary programs costing $6.5 billion annually, 28 of which are specifically designed to spur growth in new markets.  Because of this redundancy, many projects and corporations are double dipping on taxpayers—receiving multiple federal subsidies through other grant programs and tax giveaways.  Furthermore, it is unclear which of these best meets the overlapping goals, or if any of them spur more economic growth than policies encouraging private investments that do not spend taxpayer money.

A separate Government Accountability Office report issued today, also critical of the New Markets Tax Credit program, revealing:

  • The fees charged by the CDEs reduced the amount of assistance provided to low-income community projects by $619 million (7.1 percent) from 2011 to 2012;
  • A majority of NMTC-financed projects utilize more than one source of public funding, despite the purpose of the tax credit being to leverage private investment;
  • Nearly two-thirds (62 percent) of New Markets projects received other public funding from 2010 to 2012; and
  • New Markets investors are able to claim the tax credit on the equity provided by the other public sources.
A summary of the GAO report is here.
###

WASHINGTON – Today, the Chairmen and Ranking Members of the Senate and House committees on government oversight sent a letter to Office of Management and Budget Director Shaun Donovan in light of serious concerns that certain Offices of Inspectors General are experiencing problems obtaining documents from their respective agencies. Senate Homeland Security and Governmental Affairs Committee Chairman Tom Carper (D-Del.) and Ranking Member Tom Coburn (R-Okla.) together with House Oversight and Government Reform Committee Chairman Darrell Issa (R-Calif.) and Ranking Member Elijah Cummings (D-Md.) requested that Director Donovan take “affirmative steps to ensure that all agencies and their staffs are properly informed and trained on the requirements of the Inspectors General Act so that IGs receive the information they need to do their jobs.”

“We write to express our grave concern about difficulties that certain Inspectors General have encountered in trying to obtain documents from their respective agencies,” the Members wrote to Director Donovan. “Timely and complete access to information is essential if Inspectors General are to perform their missions, and their rights to information are clearly provided for in the Inspector General Act of 1978. We call on you to underscore this important fact and enlist your office to help ensure that agencies comply.”

The text of the letter is below:

August 8, 2014

 

Shaun L. Donovan

Director

Office of Management and Budget

301 G Street, S.W.

Washington, D.C. 20024

 

Dear Director Donovan:

We write to express our grave concern about difficulties that certain Inspectors General (IG) have encountered in trying to obtain documents from their respective agencies. Timely and complete access to information is essential if Inspectors General are to perform their missions, and their rights to information are clearly provided for in the Inspector General Act of 1978. We call on you to underscore this important fact and enlist your office to help ensure that agencies comply.

Earlier this week, we received a letter signed by 47 of the federal IGs raising serious concerns about difficulties some have faced receiving documents needed for their work. In particular, the letter (attached) details problems encountered by the respective Inspectors General for the Environmental Protection Agency, the Justice Department and the Peace Corps. This is not the first we have heard of these problems. Our offices have already spent time working with the affected IGs in an effort to try and help them gain the needed information. Indeed, Chairman Issa and Ranking Member Cummings examined some of these concerns during hearings before the House Committee on Oversight and Government Reform this year.

As the letter reflects, the affected IGs have gained access to some of the disputed material. Yet this progress occurred only after significant time and effort by numerous parties.

Under the Inspector General Act, IGs are broadly empowered to undertake whatever investigations or reports they consider “necessary or desirable.”[1] In support of this function, Section 6(a)(1) of the Act clearly states that IGs shall “have access to all records, reports, audits, reviews, documents, papers, recommendations, or other material available to the applicable establishment which relate to programs and operations with respect to which that Inspector General has responsibilities under this Act.”

We are pleased to note that in the majority of cases, IGs do receive requested information without undue argument or delay. But these recent conflicts raise concerns about agencies’ interpretations of the Inspector General Act with respect to access. In most cases, IG access to requested materials should be beyond question. When conflict arises between an agency and an Inspector General, agencies should engage quickly and proactively with the affected Inspector General to try to resolve any possible conflicts in a manner that allows the Inspector General to do his or her work.

We trust that you share our commitment to the mission and effectiveness of the Inspectors General, and ask that you take affirmative steps to ensure that all agencies and their staffs are properly informed and trained on the requirements of the Inspectors General Act so that IGs receive the information they need to do their jobs.

With best personal regards, we are

Sincerely yours,

Thomas R. Carper                                                      

Chairman

Committee on Homeland Security

and Governmental Affairs

 

Tom Coburn, M.D.

Ranking Member

Committee on Homeland Security

and Governmental Affairs

 

Darrell Issa                                                                 

Chairman

Committee on Oversight                                              

and Government Reform       

 

Elijah Cummings        

Ranking Member

Committee on Oversight

and Government Reform

 

###

(WASHINGTON, D.C.) – Less than seven percent of the spending information reported to USASpending.gov is accurate. More than $600 billion in spending is completely missing, according to a new report by the Government Accountability Office.

In 2006, Dr. Coburn, along with then-Senator Barack Obama, introduced the Federal Funding Accountability and Transparency Act (FFATA), which was signed into law by President Bush.  The law required the creation of a single website to track all federal spending. In order to address the inconsistency of the information on USAspending.gov, Senators Coburn, Portman, Warner, and Carper passed the DATA Act, a bill originally introduced by Congressman Issa that improves the reporting required under FFATA and requires the posting of even more granular information. 

“The administration set a goal of 100% accuracy by the end of 2011,” Dr. Coburn said, “Three years later the federal government cannot even break a 10% accuracy rate. This complete failure in spending transparency hurts our ability to assess the pros and cons of how Washington spends tax dollars. It is disappointing that the federal bureaucracy is so vast and unaccountable that the Administration cannot enact the president’s signature accomplishment as a senator requiring the government to disclose how and where it spends money. Without transparency there can be no accountability,”

“We live in a world in which information drives decisions and, given the budget constraints that our government faces, we need reliable information on how and where our money is being spent. By increasing the availability, accuracy, and usefulness of federal spending information, we enhance government transparency, improve accountability, and reduce wasteful government spending,” Chairman Carper said. “This latest GAO report underscores the federal government’s ongoing challenges when it comes to showing the American people how their tax dollars are being used, at what cost, and with what result. That’s why efforts like the DATA Act are so important. The bipartisan DATA Act takes an important first step towards the establishment of government-wide financial data standards, which will significantly improve the ability of policy makers and the public to analyze how federal tax dollars are being spent. But as with any legislation, Congress’ job does not end when the President signs the bill. Fortunately, this report will help guide us in our efforts as we work with the Administration to ensure that the DATA Act is properly implemented. I urge the Administration to follow through with GAO’s recommendations and I will continue to collaborate with my colleagues in Congress as we work toward a more transparent and responsive government.” 

"At a time when the government is running trillion-dollar deficits on top of a record $16 trillion debt, Washington should be doing all it can to track how taxpayer dollars are spent,” Portman stated. “This report is more evidence that we need the transparency and visibility that comes with the DATA Act now more than ever so we can identify and eliminate wasteful spending.”

“It is completely unacceptable that the federal government continues to struggle to report even the most basic information on how taxpayer resources are spent. Congress cannot conduct effective oversight if spending information is unreliable, and taxpayers are rightly frustrated when information isn’t accurate or easily accessible,” Warner said. “This is exactly why I authored and Congress enacted the Digital Accountability and Transparency Act earlier this year, which will modernize the way federal financial data is collected and reported.”

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July 2014

WASHINGTON- The Senate Committee on Homeland Security and Governmental Affairs Committee approved legislation Wednesday that would take a number of steps to improve the Department of Homeland Security’s chemical security program. The substitute amendment introduced by Committee Chairman Tom Carper (D-Del.) and Ranking Member Tom Coburn (R-Okla.), The Protecting and Securing American Chemical Facilities from Terrorist Attacks Act of 2014, would reauthorize the Chemical Facility Anti-Terrorism Standards Program (CFATS) until 2018, strengthen management practices and whistleblower protections, simplify reporting and information sharing practices, and provide programmatic stability for the next four years. In May, the Committee held a hearing to examine the current state of the CFATS program and the need to reauthorize it. 

“Chemicals – including dangerous ones - play an important role in our economy and our daily lives. That’s why it is crucial that the federal government and industry work together to ensure chemicals are being produced, handled and stored in a manner that is both safe and secure,” Chairman Carper said. “While the Administration has made significant improvements to the Chemical Facility Anti-Terrorism Standards program over the past year, it is clear that the current program is in need of reform.  Dr. Coburn and I have worked closely with the Administration and stakeholders to examine the effectiveness of existing chemical security regulations and identify whether additional steps should be taken to address concerns that have been raised over the years by the chemical industry and better protect the public from those who might use dangerous substances to do us harm. This compromise builds on the strong bipartisan work done by our colleagues in the House, and gives the Department of Homeland Security the tools it needs to continue making the kind of robust improvements we’ve seen over the past year. Most importantly, it provides a longer term authorization, creating more predictability and certainty for the Department and industry alike. I look forward to working with my colleagues to advance this bill in the full Senate.”

“Since its creation, the CFATS program has been beset by chronic mismanagement, missed goals, backlogs, and regulatory excess. This program exists to increase our nation’s security against attacks on chemical facilities, but it hasn’t adequately met that goal. Combined with the current leadership at CFATS, I am confident this bill will provide the necessary fixes to put the program on track to reducing our nation’s vulnerability to chemical terrorism,” Dr. Coburn said.

###

Jul 30 2014

Coburn-Warren Truth in Settlements Act Passes Homeland Security & Governmental Affairs Committee, Heads to Full Senate

Bipartisan Legislation Would Require Greater Federal Agency Settlement Transparency

(WASHINGTON, D.C.) – Bipartisan legislation that would increase public transparency around financial settlements reached by federal enforcement agencies, The Truth in Settlements Act, is one step closer to become a reality. Originally introduced by U.S. Senators Tom Coburn, M.D. (R-OK) and Elizabeth Warren (D-MA), the bill passed the Senate Homeland Security & Governmental Affairs Committee today.

"Taxpayers deserve to know the settlement details corporations arrange with the government, and the best place for Congress to start is with policies that enhance transparency," Dr. Coburn said. "Since agencies are not currently required to disclose the financial structure of government settlements, too often the true value of those settlements is not known because often companies are allowed to deduct part of the payment. Our bill gives taxpayers the transparency tools they need to access real information and numbers regarding enforcement settlements." 

“When government agencies reach settlements with companies that break the law, they should disclose the key terms of those deals to the public," said Senator Warren. "Today’s vote moves us one step closer to increased transparency and stronger accountability around government settlements. This bill will help shut down backroom deal-making and ensure that Congress, citizens and watchdog groups can hold regulatory agencies accountable for stronger and more effective enforcement to the law." 

When federal agencies settle cases, they often tout the dollar amount obtained from the offender, but in many cases that amount is misleading because of tax deductions and other "credits" built into the settlement that reduce the settlement's true value. Worse, sometimes agreements are deemed confidential, with key details or even the fact of a settlement hidden from the public. The Truth in Settlements Act will require more accessible and detailed disclosures about these agreements to allow the public to hold regulators accountable for the true value of these deals.

Under the Truth in Settlements Act, any agency that issues a written public statement that references the amount to be paid under a settlement will be required to include explanations of how those payments are categorized for tax purposes and whether those payments may be offset by "credits" for particular conduct. Companies that settle with enforcement agencies will be required to disclose in their Securities and Exchange Commission (SEC) filings whether they have deducted any or all of the dollar amounts of their settlements from their taxes; and federal agencies will be required to post basic information about settlements and provide copies of those agreements on their websites.

###

(WASHINGTON, D.C.) – A multi-million dollar effort by the Department of Homeland Security (DHS) to secure dangerous chemical facilities from terrorists is a near-total failure, according to a new Congressional report, Chemical Insecurity.”

Since 2006, Congress has poured nearly $600 million into the Chemical Facility Anti-Terrorism Standards (CFATS) program, and outfitted DHS with hefty authorities to require tough new security standards for chemical manufacturing plants, storage tanks and other facilities. But the country is little safer, concludes the report from U.S. Senator Tom Coburn, M.D. (R-OK).

“Today – eight years later – there is little, if any, evidence to show that the more than half a billion dollars DHS has spent created an effective chemical security regulatory program or measurably reduced the risk of an attack on our chemical industrial infrastructure,” according to Dr. Coburn.

What happened?

The report, drawing from documents obtained from DHS, interviews, as well as audits and reviews by the Government Accountability Office (GAO) and the DHS Inspector General, points to a laundry list of errors and bad decisions, many of which the Department has worked to keep from the public. For instance:

  • DHS officials discovered in 2010 they had erroneously included 100 sites that should never have been part of the program, due to a “computational error.”
  • In another risk-calculation flub, DHS officials in 2012 realized they forgot to factor in the risk to populations who lived near chemical facilities that weren’t in the continental United States, such as plants in Alaska and Hawaii.
  • An internal DHS review last year found “fundamental problems, errors, inconsistencies, and unsupported assumptions in the methodology underlying the whole CFATS program.”

Based on these errors – along with other problems previously reported, including CFATS officials’ purchase of rappelling gear, HAZMAT suits and other equipment for which they had no need.

Sen. Coburn concludes:

  • DHS’ CFATS program is not reducing our nation’s risk of a terrorist attack on chemical facilities.
  • DHS does not know whether some dangerous chemical facilities even exist.
  • CFATS regulates the wrong facilities.
  • DHS is not transparent about how the CFATS program works and creates an adversarial relationship with the companies it regulates.

“Without major changes in the program, the CFATS program will never work as intended,” said Sen. Coburn.

As Ranking Member of the Senate Homeland Security and Government Affairs Committee, Tom Coburn alongside the Chairman Tom Carper are expected to release reform legislation for the program at a committee business meeting on Wednesday. 

Additional information here.

###

(WASHINGTON, D.C.) – “Wealthy farmers are harvesting subsidies from sixty similar, overlapping and duplicative federal programs,” U.S. Senator Tom Coburn, M.D. (R-OK) said in response to a newly released report from the Government Accountability Office (GAO) entitled, “Farmers Have Been Eligible for Multiple Programs and Further Efforts Could Help Prevent Duplicative Payments,” which reveals that many of the largest and wealthiest farms in America benefit from multiple, overlapping farm program payments.  

GAO’s report notes that national net farm income increased from $83.7 billion in 2008 to $113.8 billion in 2012, and is forecast to have reached a record of $130.5 billion in 2013. During the 2008-2012 time period, seven USDA agencies obligated $173 billion in farm payments through sixty programs. The report further highlights the sprawling bureaucracy across farm support programs and identifies several areas where duplicative payments are occurring or at risk of occurring in the future. Finally, GAO stated “Larger farms or farms producing cash grains such as corn were more likely to receive payments from multiple programs than small farms or farms producing other crops. Larger farms also received more crop insurance premium subsidies than other farms.”

“I am disappointed that Congress recently missed a historic opportunity with the Farm Bill to ensure a robust and efficient farm safety net. Instead, it made only cosmetic changes to the extensive system. With a national debt that now threatens the future well-being of all Americans, Congress has a responsibility to address GAO’s findings and ensure the safety net for our nation’s farmers is functioning as efficiently and effectively as possible, not merely providing benefit to those who need the least assistance.” Dr. Coburn said.

GAO concluded there was sufficient evidence of overlap between the sixty USDA programs available to farmers, and recommended controls be put in place to avoid duplicative payments in the future.

###

(WASHINGTON, D.C.) – A new Government Accountability Office (GAO) investigation, “Security Clearances: Tax Debts Owed by DOD Employees and Contractors,” has discovered that 83,000 DOD employees and contractors eligible for a security clearance owed $730 million in unpaid federal taxes. 

“It is vital that the Administration and Congress work diligently to eliminate potential threats that compromise the integrity of the federal workforce and the privileged information they safeguard,” Dr. Coburn said. “Giving security clearances to individuals who fail to follow the law is unwise and risky. Federal tax cheats with security clearances jeopardize both our national and economic security, and could unnecessarily put our nation’s classified information at risk. We must take prudent precautions not only to enhance our security, but also to encourage federal employees to pay their share of taxes and live by the same rules that so many hard working Americans do.”

According to the report, approximately 5.1 million employees and contractors have a security clearance. GAO conducted its analysis between January 2006 and December 31, 2011. During that time, GAO found that approximately 83,000 Department of Defense military and civilians employees and contractors that held or were approved for security clearances, owed $730 million in unpaid federal taxes. According to the IRS, the tax debt of individuals and businesses owed to the U.S. government was about $374 billion as of September 30, 2013.

Key findings include:

  • Of the 83,000 individuals found to owe backed taxes, 40% (34,000) had a repayment plan with the IRS to pay back their debt.  These individuals with repayment plans owed approximately $262 million (meaning that 60% did not have a repayment plan owed $468 million).
  • Of the 83,000 individuals, 44,500 were federal employees and owed $363 million.
  • Of the 83,000 individuals, 20,400 were given a top-secret clearance owed $249 million.
  • Approximately 76 percent (63,000 individuals) accrued tax debts onlyafter the issuance of the security clearance.
  • Of the 83,000 individuals, 26,000 (31%) with unpaid federal tax debts were granted access to secret, top secret, or SCI information and owed $229 million.

Because OPM’s systems do not maintain information on the denial of security clearances on the basis of an individual’s nonpayment of federal taxes, it is unknown how many individuals were denied a clearance for having unpaid federal taxes.

(WASHINGTON, D.C.) – Today, U.S. Senators Tom Coburn, M.D. (R-OK) and Tom Carper (D-DE) introduced S. 2651, the Department of Homeland Security Office of Inspector General Mandates Revision Act of 2014, which would eliminate excessive, unread and outdated reports mandated by federal law.  

“Congress mandates hundreds of reports that often waste valuable time and resources on unnecessary and outdated products that no one reads.   S. 2651 attempts to relieve this burden for the Department of Homeland Security’s Office of Inspector General.  This legislation will provide flexibility for the office to perform more important audits vital to its oversight function and mission of preventing waste, fraud, and abuse,” Dr. Coburn said.  “These outdated reports are largely busy work that does not result in any real changes.  This bill eliminates these wasteful reporting requirements that cost taxpayers a total of $7.8 million last year, and do little to help the Department of Homeland Security better protect our nation.  Instead of mandating reports, Congress should mandate results and conduct real oversight to make sure agencies are operating efficiently.”   

“In an agency as large and important as the Department of Homeland Security, the Office of the Inspector General is a critical ally,” said Chairman Carper. “It is our duty in Congress to conduct fruitful oversight and ensure that the role and functionality of the Inspector General is fully supported. This measure is an important step that will eliminate certain wasteful reports that often restate information already provided by federal agencies, as well as enhance the Inspector General’s ability to deter waste, fraud and abuse within the Department. It will also enable the Department’s Inspector General and Congress to spend more time working together to recommend ways for the Department to carry out its critical responsibilities in the most effective and efficient ways possible.”

See a summary of the legislation here.

###

(WASHINGTON, D.C.) – U.S. Senator Tom Coburn, M.D. (R-OK) announced today he will hold a final series of town hall meetings in the state before resigning from the U.S. Senate at the end of the current Congress.

“One of the highlights of serving as a U.S. Senator for Oklahoma is the ability to travel the state to talk to fellow Oklahomans and hear what they think about the issues we face as a nation,” Coburn said.  “It is always encouraging and inspiring to me to talk with friends and neighbors across the state.  Our people make this such a special place to live.  So many good ideas and initiatives that my office has worked on over the years have resulted from conversations at these town hall meetings.”

The town hall meetings will take place the first two full weeks in August.

Coburn concluded, “As I prepare to hold my final series of town hall meetings, I am reminded how grateful I am to the people of Oklahoma who entrusted me to serve them in Washington.  I am proud and honored to be from Oklahoma, and my hope is this series of meetings will be an opportunity to reflect on what we have accomplished together over the last decade and a chance look to the future to continue working to make sure America remains the greatest nation in the world.” 

Monday, August 4, 2014

Oklahoma City Town Hall Meeting

Monday, August 4, 2014

6:00 p.m.

Oklahoma City Community College

Visual and Performing Arts Center Theater

7777 S. May Avenue

Oklahoma City, OK  73159

Tuesday, August 5, 2014

Altus Town Hall Meeting

Tuesday, August 5, 2014

10:00 a.m.

Western Oklahoma State College
Herschal H. Crow Fine Arts Auditorium

2801 N. Main Street
Altus, OK  73521

Lawton Town Hall Meeting

Tuesday, August 5, 2014

1:00 p.m.

Cameron University

CETES Conference Center, Building 20

2800 W. Gore Blvd.

Lawton, OK  73505

Monday, August 11, 2014

Enid Town Hall Meeting

Monday, August 11, 2014

3:00 p.m.

Enid Convention Hall

301 S. Independence

Enid, OK  73701

Wednesday, August 13, 2014

Tulsa Town Hall Meeting

Wednesday, August 13, 2014

6:00 p.m.

Tulsa Community College - Southeast Campus

VanTrease PACE

10300 E. 81st Street

Tulsa, OK  74133 

###

(WASHINGTON, D.C.) – Today, Homeland Security & Government Affairs Committee Ranking Member Tom Coburn (R-OK), Finance Committee Ranking Member Orrin Hatch (R-UT), Ways and Means Committee Chairman Dave Camp (R-MI), and Oversight Subcommittee Chairman Charles Boustany Jr., M.D. (R-LA) released the preliminary results of a Government Accountability Office (GAO) undercover examination of enrollment controls in the ObamaCare health care exchanges. 
 
As part of a “secret shopper” investigation, GAO created 18 fictitious identities to apply for premium subsidies through the federal Exchange by telephone, online and in-person.  With only one exception, GAO was able to get premium tax credits and health insurance with fake information through telephone and online applications.  The results of their investigation are as follows:
 
11 out of 12 Fake Applications Approved: Out of 12 applications with fake information for the Federal exchanges, 11 were approved.  The total amount of these credits was $2,500 per month or $30,000 per year and is currently being paid out for insurance policies for these fictitious individuals.
 
Applications with Fake Documents of Citizenship and Income Approved: Investigators provided fake documents, such as Social Security Numbers and proof of income and citizenship, which proved to be no barrier to getting taxpayer-funded credits.  Additionally, investigators found that federal contractors made no effort to authenticate documents applicants provided.
 
In-Person Assisters Nowhere to be Found: GAO made six in-person attempts to sign up for federal subsidies.  GAO was unable to obtain assistance in five of those attempts for a range of reasons including one navigator stating assistance was not available because HealthCare.gov was down and another declining to provide assistance.  These assisters have received tens of millions of dollars in federal grants to provide services to applicants.

Ranking Member Tom Coburn: “GAO’s early results of its audit ofHealthcare.gov are astounding.  Fictitious people have used fictitious documents to gain tens of thousands of dollars in real subsidies.  Yet, before subsidies were paid in January, the former secretary ‘certified’ the proper controls were in place to prevent these kinds of improper payments.  Given GAO’s evidence and the OIG’s findings earlier this month, we have seen consistent problems in how HHS has implemented Healthcare.gov.  Far from fictitious, this kind of incompetence and gross mismanagement is unacceptable and deeply troubling.  At a time when we’re facing a $17 trillion debt, it is imperative that HHS take the necessary steps to address the problems identified in GAO’s report.”

Finance Committee Ranking Member Orrin Hatch: “Ironically, the GAO has found Obamacare is working really well – for those who don’t exist.  When the Administration deemed the conversation about Obamacare over after reaching enrollment targets, they were dead wrong.  These appalling findings not only question the validity of their numbers but show this poorly drafted law’s massive vulnerabilities to rampant waste and fraud.  From the outset, I have raised the alarm on the enormous fraud and abuse implications of this ill-conceived law.  Now the question is: Will this Administration finally own up to the taxpayer funded sinkhole this law has turned into and protect American families and taxpayers moving forward?”
 
House Ways and Means Committee Chairman Camp: “We are seeing a trend with ObamaCare information systems: under every rock, there is incompetence, waste, and the potential for fraud. Last month, we found that the Administration was unable to verify income or eligibility for insurance subsidies.  Now, we learn that in many cases, the Exchange is unable to screen out fake identities or documents.  This law is already hitting Americans where it hurts the most – their pocketbooks.  Now, this Administration is forcing the American taxpayer to foot the bill for ObamaCare’s waste and fraud.”
 
House Oversight Subcommittee Chairman Boustany: “ObamaCare is a mess.  Its broken structure invites waste, fraud, and abuse that will cost the American taxpayer millions in subsidies to individuals whose eligibility the Administration won’t bother to verify.  No wonder hard-working Americans are fed up with a government that spends too much on broken programs that aren’t doing the job they’re intended to.  We can and must do better.”
  
Background: According to GAO, nationally over 2.6 million application inconsistencies have been found for people who have selected health plans in the Exchange.

###

In a letter to Acting Inspector General Griffin of the U.S. Department of Veterans Affairs (VA), Dr. Coburn requested an investigation into specific areas at OKC VAMC to ensure veterans are receiving the care and management they deserve. 

Specifically, Dr. Coburn has requested the VA OIG conduct a thorough investigation into all surgery clinics, podiatry, primary care, scheduling, customer service, GI clinic, internal medicine, pharmacy, hospital administration, and facility security of the OKC VAMC. 

WASHINGTON - Today, Homeland Security and Governmental Affairs Committee Chairman Tom Carper (D-Del.) lauded the Senate confirmation of Shaun Donovan as the Director of the Office of Management and Budget (OMB). The Senate confirmed Secretary Donovan by a vote of 75 to 22.

Chairman Carper released the following statement after Secretary Donovan’s confirmation:

“The Director of the Office of Management and Budget (OMB) is a critical position in putting our nation on a responsible, sustainable fiscal path,” said Chairman Carper. “Shaun Donovan has proven himself to be a leader who will be a strong voice for fiscal responsibility and for effective government management. As Secretary of the Department of Housing and Urban Development over the past five years, Secretary Donovan has a maintained a proven track record of cutting through red tape and finding ways for agencies to work more effectively together. As Director of OMB, I know he will continue to foster interagency coordination and be a leader of integrity and intelligence as he spearheads the agency’s critical mission. While his predecessor Sylvia Mathews Burwell left big shoes to fill, I believe he is up to the task. I appreciate Secretary Donovan’s willingness to serve the people of this country in this critical capacity and I look forward to working with him in his new role.”

Chairman Carper spoke on the Senate floor in support of Secretary Donovan’s nomination earlier today. To read a copy of his remarks, as prepared for delivery, click here.

In June, the Senate Homeland Security and Governmental Affairs Committee held the nomination hearing on Secretary Donovan’s nomination.

###

(WASHINGTON, D.C.) – U.S. Senator Tom Coburn, M.D. (R-OK) released the following statement today regarding the U.S. Citizenship and Immigration Services’ (USCIS) decision to hire a firm accused of fraud.

“The U.S. Citizenship and Immigration Services’ (USCIS) decision to spend $190 million to hire the same firm that vetted and cleared NSA leaker Edward Snowden is troubling.  In addition to clearing Snowden, the award recipient – the U.S. Investigations Services (USIS) LLC – is currently under federal investigation for improperly reviewing background checks in an effort to increase its revenue.  Government claims that USIS is a ‘low’ risk and has ‘outstanding’ management are ludicrous.  Just a month ago, the Office of Personnel and Management’s (OPM) Inspector General found that a USIS reviewer completed 15,152 background investigations reviews during a one month timeframe with most occurring within minutes of each other.  The IG also found that 24 percent of the reviewers audited did not have documented proof they met the required training under their contract,” Dr. Coburn said.

When questioned by the Wall Street Journal on the decision, USCIS said that they had to award the contract to the lowest bidder.  Yet, in March, the Court of Federal Claims indicated in a ruling on a protest by one of the losing bidders that USCIS’ bid was higher than at least two of the losing bidders.  The opinion also notes that the contract was awarded to the bidder providing the overall “best value” to the government, and that price was actually the least important factor for deciding who won.

“The fact that a company can commit so many mistakes – including ones that jeopardize our national security – and be rewarded for their incompetence at a high price tells us yet again that our contracting system is broken,” Dr. Coburn continued.  “I look forward to conducting further oversight into this important issue.”

###

Amendment # 3459 - to exclude National Park System land from the payments in lieu of taxes program. Additional information here.

Amendment # 3460 - to change the price of the senior lifetime interagency parks pass from $10 to $80. Additional information here.

Amendment # 3461 - to provide that amounts in the Federal Land Disposal Account shall be used for Federal budget deficit reduction and to address the maintenance backlog on Federal land. Additional information here.

Amendment # 3462 - to provide proper due process for veterans to prevent them from being unfairly deprived of their Second Amendment Rights. Additional information here.

Amendment # 3466 - to authorize funds from the Land and Water Conservation Fund to be used to address deferred maintenance backlog issues on Federal lands. Additional information here.

Today, Dr. Coburn received a response from the HHS Office of Inspector General to an oversight request he submitted with Sen. Burr and Chairman Darrell Issa and Rep. Gowdy in December 2011. They asked the OIG to review whether states were adequately implemented several statutory requirements concerning asset transfers and estate recovery in Medicaid, provisions intended to limit Medicaid eligibility for upper-income individuals.  

The full letter is here

(WASHINGTON, D.C.) – U.S. Senator Tom Coburn, M.D. (R-OK) commented today on the reports released by the Department of Health and Human Services (HHS) Inspector General (IG) regarding the lack of safeguards to prevent improper subsidies under Obamacare.

“The reports released today highlight that the federal government lacks necessary safeguards to prevent taxpayers from providing improper subsidies to illegal immigrants, individuals who are incarcerated, or individuals whose income is too high to qualify for a subsidy,” Dr. Coburn said.  “The Obama Administration has failed to keep its promise that effective controls were in place to prevent waste and fraud in Obamacare payments.  These reports show a trend of broken promises in Obamacare’s botched implementation.”  

HHS IG reports summary:

HHS IG released two reports today on inconsistencies within applications for health insurance on a state or federal exchange.  An inconsistency occurs when the information reported by an applicant cannot be verified, and can result in ineligible individuals (such as illegal immigrants, individuals who are incarcerated, or individuals whose income too high to receive Obamacare subsidies) receiving taxpayer subsidies under Obamacare.  The most common inconsistencies reported from the Federal and State marketplaces were inconsistencies related to income and citizenship.

These reports, mandated by the Consolidated Appropriations Act, 2014, are the first two in a series of reports the IG plans to conduct on HHS’ activities to verify the eligibility of health care applications within federal and state exchanges.

IG Findings:

“The Federal marketplace was generally incapable of resolving most inconsistencies. Without the ability to resolve inconsistencies in an applicant’s eligibility data, the marketplace cannot ensure that an applicant meets each of the eligibility requirements for enrollment in a QHP [qualified health plan] and when applicable, eligibility for insurance affordability programs.”

Federal Marketplace:

  • 89 percent of inconsistencies were unresolved (2.6 million out of 2.9 million inconsistencies) because the system was not fully operational
  • Most of these inconsistencies related to citizenship, national status, lawful presence, income, and employer-sponsored minimum essential coverage
  • The Federal marketplace was capable of resolving inconsistencies with Social Security numbers, non-employer minimum essential coverage, incarceration status, and whether the applicant is an Indian. However, even though CMS’ system to process these types of inconsistencies was operational, it only resolved less than 1 percent of these inconsistencies.

State Marketplaces:

Out of the 15 states that did not use the Federal marketplace:

  • Massachusetts, Nevada, Oregon, and Vermont reported they were unable to resolve inconsistencies
  • California reported it resolved some inconsistencies but lacked the resources to resolve all of them
  • Hawaii, Minnesota, and Colorado relied on their state Medicaid offices to resolve inconsistencies (Hawaii and Minnesota reported that all applicants apply for Medicaid before applying for a QHP)
  • The seven remaining state marketplaces (Connecticut, D.C., Kentucky, Maryland, New York, Rhode Island, and Washington) reported they resolved the inconsistencies. However, the IG’s second report which included a review of Connecticut’s exchange found, despite reporting it resolved inconsistencies, “The Connecticut marketplace determined applicants to be eligible for insurance affordability programs when they were not eligible.”

Dr. Coburn’s Previous Work on this Issue:

Senators Hatch, McConnell and Coburn sent a letter urging HHS IG to carefully examine reports that the government may be paying incorrect Obamacare subsidies. Find more information here: http://www.coburn.senate.gov/public/index.cfm/pressreleases?ContentRecord_id=02255264-0ece-44d2-b187-502a71c7b3e2 

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June 2014

(WASHINGTON, D.C.) – U.S. Senator Tom Coburn, M.D. (R-OK) released the following statement today regarding the Supreme Court’s ruling on the Hobby Lobby case:

The Supreme Court’s decision today is a victory for all Americans.  The Court wisely affirmed that it is wrong for the government to violate the freedom of conscience and religious liberties of American citizens.  Religious freedom is the foundation of all of our rights and that foundation was strengthened by today’s ruling.

Hobby Lobby’s success has always been based on its owners' – the Green family’s – work ethic and character, which are informed by their religious beliefs.  Hobby Lobby is closed on Sunday, they pay their employees a livable wage, they provide health insurance for their employees, and they support numerous charities across the nation.  I am pleased the Supreme Court sent a message to other business owners and entrepreneurs across America that they don’t have to surrender their Constitutional rights when opening a business.

Finally, this case was not about access to birth control, but government coercion.  Hobby Lobby, which employs thousands of Americans across the country, provides its employees with quality health care insurance, including coverage for nearly all FDA approved contraceptives.  This case was about the federal government forcing Hobby Lobby’s owners to choose between paying for life-ending drugs and devices and violating their beliefs, or crippling their business.  I’m pleased the Court ruled in favor of freedom.

###

 

(WASHINGTON, D.C.) – U.S. Senator and doctor Tom Coburn, M.D. (R-OK), today released his new oversight report “Friendly Fire: Death, Delay, and Dismay at the VA.”  The report is based on a year-long investigation of VA hospitals around the nation that chronicled the inappropriate conduct and incompetence within the VA that led to well-documented deaths and delays.  The report also exposes the inept congressional and agency oversight that allowed rampant misconduct to grow unchecked.

“This report shows the problems at the VA are worse than anyone imagined.  The scope of the VA’s incompetence – and Congress’ indifferent oversight – is breathtaking and disturbing.  This investigation found the problems at the VA are far deeper than just scheduling.  Over the past decade, more than 1,000 veterans may have died as a result of the VA’s misconduct and the VA has paid out nearly $1 billion to veterans and their families for its medical malpractice.  As is typical with any bureaucracy, the excuse for not being able to meet goals is a lack of resources.  But this is not the case at the VA where spending has increased rapidly in recent years,” Dr. Coburn said.

“The Administration and Congress have failed to ensure our nation is living up to the promises we have made to our veterans,” Dr. Coburn added.  “As a physician who has personally cared for hundreds of Oklahoma veterans, this is intolerable.  As a senator, I’m determined to address the structural challenges of the Department of Veterans Affairs so we can end this national disgrace and improve quality and access to health care for our veterans.  But make no mistake.  Whatever bill Congress passes cannot ignore the findings of this report.  While it is good that Congress feels a sense of urgency we are at this point because Congress has ignored or glossed over too many similar warnings in the past.  Our sense of urgency should come from the scope of the problem, not our proximity to an election.”

Key findings in the report include:

A CULTURE OF MANIPULATION PERMEATES THE DEPARTMENT.

  • The cover up of waiting lists for doctor’s appointments at the VA is just the tip of the iceberg, reflecting a perverse culture within the department where veterans are not always the priority and data and employees are manipulated to maintain an appearance that all is well.
  • Bad employees are rewarded with bonuses and paid leave while whistleblowers, health care providers, and even veterans and their families are subjected to bullying, sexual harassment, abuse, and neglect.  For example, female patients received unnecessary pelvic and breast exams from a sex offender, a noose was left on the desk of a minority employee by a co-worker, and a nurse who murdered a veteran harassed the family of the deceased to get them to admit guilt for the death.
  • The care at more centers is getting worse and some VA health care providers have lost their medical licenses, and the VA is hiding this information from patients. 
  • Delays exist for more than just doctors’ appointments—disability claims, construction, urgent care, and registries are also slow or behind schedule.
  • Despite a nursing shortage, many VA nurses spend their days conducting union activities to advocate for better conditions for themselves rather than veterans.

VA MADE WAITING LISTS WORSE.

  • As waiting lines were growing, the VA expanded eligibility in 2009 to those who already had insurance without any service related injuries, making the delays longer.
  • Despite having the authority to do so, the VA was reluctant to let vets off the waiting lists by freeing them go to doctors outside of its system while sitting on hundreds of millions of dollars intended for health care that went unspent year to year.
  • VA doctors are seeing far fewer patients than private doctors and some even leave work early.

VA EMPLOYEES BEHAVE AS IF THEY ARE ABOVE THE LAW.

  • Criminal activity at the department is pervasive, including drug dealing, theft, and even murder.  A VA police chief even conspired to kidnap, rape and murder women and children.
  • Many VA doctors and staff are overpaid and underworked, some are paid not to work and more and more employees are not even showing up for work.

THE VA WASTES AND MISMANAGES BILLIONS OF DOLLARS.

  • The report identifies $20 billion in waste and mismanagement that could have been better spent providing health care to veterans.
  • The federal government has paid out $845 million for VA medical malpractice since 2001.
  • Most VA construction projects are over budget and behind schedule, inflating costs by billions of dollars.

THE SENATE VETERANS AFFAIRS COMMITTEE HAS BEEN AWOL WHEN IT COMES TO KEEPING PROMISES MADE TO VETERANS.

  • The Senate Veterans Affairs Committee largely ignored the warnings about delays and dysfunction at the VA for decades, abdicating its oversight responsibilities and choosing to make new promises to veterans rather than making sure those promises already made were being kept.
  • This report details how Congress was repeatedly alerted and warned of the problems plaguing the VA over decades.
  • The Senate Veterans Affairs Committee has only held two oversight hearings the last four years, and was even profiled in Wastebook 2012 for being among the committees in Congress holding the fewest number of hearings.

Click here to read the entire report or here for a summary.  

The top 10 most outrageous VA behaviors are here.

The top 10 VA boondoggles are here

###

Dr. Coburn released the letter on his hold regarding S. 398, the Commission to Study the Potential Creation of a National Women's History Museum Act of 2013.

Dr. Coburn asked CRS to look into funding gimmicks used to hide federal spending increases in the appropriations bill.  The full report can be found here.

Additional information can be found here and here

(WASHINGTON, D.C.) – U.S. Senators Tom Coburn, M.D. (R-OK), Richard Burr (R-NC), and Lamar Alexander (R-TN) sent a letter to FDA Commissioner Hamburg asking for comprehensive data on the risks and benefits associated with the Expanded Access, or “compassionate use”, program.  Expanded Access allows patients to access non-FDA approved therapies which are outside of clinical trials to treat serious or immediately life threatening conditions. 

The full text of the letter is below:

June 16, 2014

Margaret A. Hamburg, MD

Commissioner

U.S. Food and Drug Administration

10903 New Hampshire Avenue

Silver Spring, MD 20993

Dear Commissioner Hamburg:

We are interested in understanding how the Expanded Access, or “compassionate use,” program at the U.S. Food and Drug Administration (FDA) is serving patients who seek access to new, unapproved therapies outside of clinical trials to treat serious or life threatening conditions.  The work of our nation’s biomedical research infrastructure and potential for medical innovation on behalf of patients is astounding.  Yet, each day patients nationwide are burdened by diseases and conditions that no FDA-approved products can cure or treat.  Those patients are understandably desperate for any treatment that might improve their ailments, quality of life, or survival.  For some, there is hope in drugs or devices that have not yet completed the FDA review and approval process, but their hopes are often frustrated since clinical trials alone often take years to complete under current design requirements. 

As we perform oversight of the compassionate use program, we respectfully ask you to provide the following information with respect to investigational new drugs (INDs), specifically:

1. The number of requests for expanded access INDs and protocols that FDA has received each year since 2009, including whether such requests were for an individual patient IND, an individual patient protocol, an emergency IND, an emergency protocol, an intermediate-size IND, an intermediate-size protocol, a broader treatment IND, or a broader treatment protocol.

2. The number of approvals for expanded access INDs and protocols each year since 2009, by category of access as listed in question 1.  

3. The average time in calendar days it took to approve or deny such requests each year since 2009, by category of access as listed in question 1.

4. Please list the conditions for which FDA has approved expanded access INDs and protocols each year since 2009, by category of access as listed in question 1.  Please also list the conditions by which expanded access INDs and protocols were rejected, if applicable, each year since 2009, by category of access as listed in question 1.

5. Does FDA collect data about the clinical trial phase of the investigational new drug at the time it is approved for expanded access?  If so, please provide the number of expanded access approvals by clinical trial stage since 2009.

6. How does FDA use data on safety and outcomes from expanded access uses in regulatory decisions regarding the safety and efficacy of investigational new drugs, including when such drugs have been submitted for review and approval by the agency?

7. In May 2013, FDA released draft guidance that said, “FDA is currently considering whether other options might better facilitate individual patient expanded access while providing appropriate ethical oversight.”  What options in addition to the full Institutional Review Board process has FDA considered to better facilitate expanded access for individual patients?  What is FDA’s timeline for further consideration and/or implementation of such options?

8. How have you worked with patients and healthcare providers to help them understand the compassionate use options and application processes?  Do you plan to finalize the May 2013 draft guidance, and if so when?  What feedback have you received on the educational expanded access training webinar?

9. How does FDA interact with drug manufacturers in considering and implementing expanded access INDs and protocols?  Please outline any applicable steps FDA could take to minimize the risks and burdens for drug manufacturers when they supply product as part of expanded access INDs and protocols.

10. We look forward to working with you on this issue to ensure the FDA’s compassionate use program is operating well for patients, providers, and the agency.  We respectfully ask that you would provide a written response within 30 days of the date of this letter. 

Sincerely,

###

Jun 14 2014

Senators Press Defense Department to End “Plugging” Numbers

false numbers mask accounting and control deficiencies

WASHINGTON – Several senators are pressing Defense Department leaders to end the practice known as “plugging.”  “Plugging” is the use of false numbers in financial ledgers that forces balances and effectively masks accounting errors and control deficiencies.

Senators Chuck Grassley, Tom Coburn, Tom Carper and Ron Johnson wrote Defense Department Comptroller Robert Hale and Inspector General Jon Rymer urging the Defense officials to take “strong corrective action to end the long-standing, wide-spread use of ‘plug’ figures, which continue to reflect a major shortcoming in DoD financial management.”

“Of great concern to us is the fact that the use of ‘plugs’ appears to be growing. For example, the fiscal year 2008 value of DoD ‘plugs’ used in the fund balance with Treasury was $5.3 billion, but in the short space of five years, it rose to $9.6 billion in 2013. That is an increase of $4.3 billion or 80%.  However, these are just net ‘plug’ figures used to balance the statements and may be just the tip of the iceberg.  When gross amounts – positive and negative ‘plugs’ -- are tallied up, it is estimated that the dollar value of all DoD “plugs” would be much higher,” the senators wrote.

The members concluded, “The DoD ‘plugging’ problem is long-standing and deep-seated in the Defense Department’s accounting culture. Such dependence on ‘plugging’ is indicative of a dysfunctional finance and accounting system. It is symptomatic of the root causes that leave the Department’s accounting books in an un-auditable condition and lead to well-deserved criticism that the Department is not a good steward of the taxpayers’ money. ‘Plugging’ should never be granted a safe haven in the DoD OIG’s own financial statements.”

Here is the text of the letter.  A signed copy of the letter can be seen by clicking here.

June 12, 2014

Transmitted Electronically

The Honorable Robert F. Hale
Under Secretary (Comptroller) and Chief Financial Officer
Office of the Under Secretary of Defense (Comptroller)
United States Department of Defense
1100 Defense Pentagon
Washington, DC 20301-1100

Mr. Jon T. Rymer
Inspector General
Department of Defense
4800 Mark Center Drive
Alexandria, VA 22350-1500

Dear Comptroller Hale and Inspector General Rymer:

The Department of Defense (DoD) has taken encouraging steps to strengthen financial management.  Department-wide improvements will allow more timely, reliable, accurate, and useful information for operational and financial decision making. However, as we surely all agree, we must all work together in order to overcome continuing and pervasive financial management problems that affect the Department’s ability to control costs, anticipate future expenditures, measure performance,  prevent and detect fraud, waste, and abuse, and above all, to provide an accurate and complete accounting of how the money is spent. 

We are writing to you today to urge you to take strong corrective action to end the long-standing, wide-spread use of “plug” figures, which continue to reflect a major shortcoming in DoD financial management.

“Plugs,” also known as reconciling amounts, are unsupported adjustments to an accounting record or general ledger. They are false numbers used to force balances and have the effect of masking accounting and control deficiencies. While not strictly prohibited by law, their use is considered unacceptable and improper by regulation and accepted accounting practices and audit standards.[1]

The use of “plug” figures throughout the Department  recently received in-depth exposure in the second part of a three-part series of articles by Scot J. Paltrow of the Reuters News Service entitled “Unaccountable: The High Cost of the Pentagon’s Bad Bookkeeping.”[2]

Of great concern to us is the fact that the use of “plugs” appears to be growing. For example, the fiscal year 2008 value of DoD “plugs” used in the fund balance with Treasury was $5.3 billion, but in the short space of five years, it rose to $9.6 billion in 2013. That is an increase of $4.3 billion or 80%.[3]However, these are just net “plug” figures used to balance the statements and may be just the tip of the iceberg. When gross amounts – positive and negative “plugs” -- are tallied up, it is estimated that the dollar value of all DoD “plugs” would be much higher.[4] A recent DoD Office of the Inspector General report on the Army and other related reports indicate that DoD plugs could easily run into hundreds of billions of dollars.[5]

Surprisingly, even the DoD Office of the Inspector General’s (OIG) own financial statement for FY 2012, which failed to earn a clean opinion, contained “unsupported adjustments” of more than $200 million, according to the independent auditor. These “plugged” entries were similarly used to “force” the general ledger into agreement with the budget execution and cash management reports to the Treasury Department. [6] We believe the OIG should be setting an example of excellence in accounting for the entire department to follow by producing credible and reliable financial statements, which would not include the use of “plugs.”

After the last Paltrow article in Reuters was published, Senator Grassley asked the DoD OIG what it had done or was planning to do to root out, expose, and address “plugging” abuses. The OIG replied by stating: “We have been reporting about the problem of unreliable data, unsupported journal vouchers and plugging for many years.” [7]To back-up this assertion, a list of 35 OIG audit reports going back to March 1994 was provided.  While these 35 reports identified plugging issues, the remedies proposed by the OIG were, for the most part, not fully implemented. The audit reports essentially told the military services and agencies involved to create new policies and procedures to do what they are already supposed to be doing. [8]  Despite all these reports, the problem of plugging within the Department is still wide-spread. The Department still needs to fix the problem. The DOD responses do not provide a high-level of confidence that the gravity of this problem is truly understood and accepted and that a solution will come any time soon.

The DoD “plugging” problem is long-standing and deep-seated in the Defense Department’s accounting culture. Such dependence on “plugging” is indicative of a dysfunctional finance and accounting system. It is symptomatic of the root causes that leave the Department’s accounting books in an un-auditable condition and lead to well-deserved criticism that the Department is not a good steward of the taxpayers’ money. “Plugging” should never be granted a safe haven in the DoD OIG’s own financial statements.

We believe that the DoD OIG must play a constructive role in helping the Department to fix its broken accounting system and to meet mandated audit readiness deadlines.

In order to play a leadership role in financial management reform, the DoD OIG should start by ending the use of plugging in its own financial statements.

We also urge the DOD Comptroller and IG to end the wide-spread use of plugging throughout the Department.  We request that you provide our offices with a plan that includes a specific timetable to accomplish this important goal. Your careful consideration of this proposal would be appreciated.

Sincerely,

Charles E. Grassley                                                     
Ranking Member                                                         
Committee on the Judiciary                                

Tom Coburn, M.D.                                                     
Ranking Member                                                         
Committee on Homeland Security and Governmental Affairs  

Thomas R. Carper                                                       
Chairman                                                                     
Committee on Homeland Security and Governmental Affairs

Ron Johnson
Ranking Member
Subcommittee on Financial and Contracting Oversight
Committee on Homeland Security and Governmental Affairs

[1]DoD Financial Management Regulation 7000.14R, Volume 4, Chapter 2, Accounting for Cash and Fund Balances with Treasury, Section 020102.B1 (Dec. 2009) as cited in CRS American Law Division Memo to Senator Grassley, 2/12/14; ``Federal Financial Management Improvement Act of 1996,''  (section 803.a.); OMB Circular A-136 Revised, “Financial Reporting Requirements,” (October 21, 2013, pages 31-33); Statement of Federal Financial Accounting Concept 5, ( pgs. 1-2): and DoD FMR, volume 6A, chapter 2, prescribes JV-related supporting documentation and approval requirements implementing Federal law and OMB requirements;
[2] How the Pentagon’s Payroll Quagmire Traps America’s Soldiers, 7/2/13, Reuters.com;  Behind the Pentagon’s Doctored Ledgers, A Running Tally of Epic Waste, 11/18/13, Reuters.com; and Why the Pentagon’s Many Campaigns to Clean Up Its Accounts Are Failing, 12/23/13, Reuters.com
[3] GAO email, 11/14/13; and DoD Agency Financial Report for FY 2013, p.82;
[4] GAO email to Senator Grassley’s office, 4/4/14;
[5] DoD OIG Report No. 2012-096, 5/31/12; Oversight Review of Audit Reporting by the DoD OIG, prepared by the Staff of Senator Chuck Grassley, 9/7/10, p. 25;
[6] DoD OIG, Financial Statement Audit, FY 2012, Independent Auditor’s Report, pp. 32-34 and 72;
[7] Emails from office of Senator Chuck Grassley to DoD OIG, 11/21/13 and 12/18/13, and DoD OIG email response, 12/17/13;
[8] Reports 98-192, 8/25/98 and  2001-177, 8/31/2001;

Jun 14 2014

U.S. Senator Tom Coburn Delivers Weekly Republican Address

‘Next week, I will be releasing an oversight report that exposes a culture within the VA where vets are not always a priority and in which administrators manipulate both data and employees to give an appearance that all is well.’

(WASHINGTON, D.C.) – In the wake of the VA scandal, Sen. Tom Coburn of Oklahoma calls on President Obama to nominate a new VA Secretary who has the management skills, leadership ability and determination to correct the myriad failings at the agency. In the Weekly Republican Address, Coburn also says the President needs to use the tools he already has to clean up his administration’s systemic failure of management at the Department of Veterans Affairs. “Veterans who have survived war should no longer have to do battle with bureaucracy to access the best possible care,” Coburn says. “It’s time to give our combat-impacted veterans the very best care that they have earned and deserve.” The Weekly Republican Address is available in both audio and video format and is embargoed until 6:00 a.m. ET, Saturday, June 14, 2014. The address is available here and a full transcript of the address follows:

“Hello. My name is Tom Coburn.

“As a physician and three-time cancer survivor, I know firsthand how frustrating the wait to see a doctor can be.

“The Department of Veterans Affairs admitted this week that veterans must wait up to three months to get a doctor’s appointment. These delays have been linked to unnecessary deaths and complications.

“This is unacceptable. It screams of government incompetency.

“But the problems at the VA are far deeper than scheduling. Getting to see a doctor, after all, does not guarantee quality care.

“Just like the VA is cooking the books to make wait times appear shorter, the department is also glossing over the growing number of hospitals with poor medical outcomes.  

“In some locations, like Boston and Pittsburgh, VA care is top notch. At others, such as at Phoenix, it is very subpar. 

“High death rates and complication rates are occurring at more and more VA centers. And this information is not being shared with our veterans.

“I never served in the military, but like all Americans, I have the wonderful benefit of living in a great country because of those who put on our uniform.

“It is unacceptable that the men and women who bravely fought for our freedom are losing their lives, not at the hands of terrorists or enemy combatants, but from neglect by the very government agency established to take care of them.

“Ironically, the vets who fought for freedom are given the least amount of freedom over their own health care decisions. Too many veterans who rely upon the VA are stuck in a bureaucratic maze that limits their choice and does not provide the quality care that they deserve.

“If you are an injured combat veteran, you should be the first in line, not the last, and your access should be guaranteed to be the best possible care. 

“There’s a simple cure to achieve these goals: Make every hospital a VA hospital.

“VA hospitals serve an important and unique role but veterans should be allowed to choose where, when and from whom they receive treatment.

“If a VA center is inconveniently located, veterans should be free to choose another doctor. 

“This week the Senate approved a bipartisan bill to empower veterans with the freedom they deserve. 

“Under this plan, veterans living over 40 miles away from VA clinic would be able to receive their care somewhere closer if they so choose to do so. Those who cannot receive a timely VA appointment would automatically have the option to see another doctor outside of the VA. 

“Bureaucrats would no longer override veterans’ choices. 

“The bill also holds VA accountable by making it easier to fire anyone who falsifies or manipulates data and makes it much more transparent by requiring disclosure of medical outcomes. 

“Passage of this bill and new leadership at the VA are just the first steps. 

“Congress cannot just hope the problems will now go away.

“The reason veterans’ care has suffered for so long is that Congress has failed to hold the VA accountable. 

“In the last four years, the Senate Veterans Affairs Committee has held just a handful of hearings touching on veterans’ health. This committee’s only responsibility is to ensure veterans are being taken care of and it has failed to do its job. 

“The problems at the VA have long been documented by government investigators who have warned of false wait times and poor management for years. But some in Congress have been far more preoccupied with making new promises rather than fulfilling the promises already made.

“Next week, I will be releasing an oversight report that exposes a culture within the VA where vets are not always a priority and in which administrators manipulate both data and employees to give the appearance that all is well.

“Employees who do the wrong thing are rewarded with bonuses and upstanding employees are often bullied and face retaliation.

“Construction costs of medical centers run over budget and the facilities have fallen behind schedule and still lack sufficient medical personnel to provide appropriate care.

“VA employees sometimes disappear from work for weeks at a time while veterans cannot get their phone calls answered or returned.

“Doctors who stop taking patients just after lunch so they can leave work.

“And billions of dollars that could be better spent on health care are mismanaged and wasted.

“Now that the Senate has passed legislation to give veterans more health care freedom, Congress must continue to do the work to improve the quality of the VA and make it a more responsive, and accountable and efficient organization.

“And the President must nominate as Secretary a capable, experienced leader who possesses the management skills, leadership ability and determination to correct the failings of the VA, support the thousands of great VA workers who are committed to serving our veterans and ensure timely quality care to all of those who have served bravely. 

“The President also needs to use the tools he already has to clean up the systemic failures of management in his Administration.

“Veterans who have survived war should no longer have to do battle with bureaucracy to access the best possible care. 

“It’s time to give our combat-impacted veterans the very best care that they have earned and deserve.

“The foundation of having other people serve depends on how well we take care of those that have.”

“May God bless you.”

###

Dr. Coburn released the following letter on his hold of the nominations of Richard Engler and Manuel Ehrlich to be members of the U.S. Chemical Safety and Hazard Investigation Board, because of the Board’s refusal to cooperate with an investigation by its inspector general.

Jun 03 2014

Senators Coburn, Burr, McCain, and Flake introduce the Veterans Choice Act

The Veterans Choice Act is supported by American Legion, AMVETS, Concerned Veterans for America, and Iraq and Afghanistan Veterans of America.

(WASHINGTON, D.C.) – U.S. Senators Tom Coburn, M.D. (R-OK), Richard Burr (R-NC),  John McCain (R-AZ), and Jeff Flake (R-AZ) today introduced S. 2424, the Veterans Choice Acta bill to increase veterans choice and accessibility when selecting their medical providers by offering veterans access to non-VA hospitals and supplementing VA care with providers in veteran’s hometowns. 

“It is wrong to ask our soldiers to fight for freedom abroad only to deny it to them here at home,” said Dr. Coburn.  “We should allow veterans to go to the doctor, and health care facility, of their choice rather than allowing politicians and bureaucrats to decide where they can receive health care. In America, every hospital should be a veterans' hospital. Our bill makes that possible."

“As I’ve long argued, we must provide for veterans without timely access to VA facilities the option of using high-quality health care providers near their homes, rather than rely on a system which is too often riddled with dysfunction,” said Senator John McCain. “This legislation increases veterans’ flexibility to get the care they’ve earned, while bringing much-needed accountability and transparency to create a VA worthy of the heroes it serves.”

“It’s clear with the evidence we now have that veterans had a lack of access to needed care, even in the past few years when VA carried over money,” said Senator Richard Burr.  “This is a cultural problem with deep roots in VA, and money will not solve cultural problems.  In fact, it could prove to only reinforce that culture.  The legislation we are introducing today will address these problems head on by getting veterans the appointments they need from the doctor of their choice, providing the transparency needed to do an apples-to-apples comparison with non-VA hospitals, and start reforming the system and changing the culture to ensure no veteran ever again dies while waiting for the care they need.”

“While the national scandal involving scheduling irregularities in VA facilities around the country deserves swift attention, and those responsible need to be held accountable, we cannot take our focus off the fact that there are still veterans awaiting care,” said Senator Jeff Flake. “Instead of lengthy wait times or secret lists, this legislation provides much-needed flexibility for veterans to get the care they need in a timely fashion.”

The Veterans Choice Act will provide immediate relief to veterans by affording them the ability to seek care nearer to their homes—and with providers they trust.  The bill provides veterans with more choice and flexibility, while bringing much-needed accountability and transparency to VA operations.

###

Additional information can be found here and here

A letter of support from IAVA here and an opposition letter from VFW here

Jun 02 2014

**MEDIA ADVISORY**

SENATORS MCCAIN, COBURN, BURR AND FLAKE TO HOLD PRESS CONFERENCE INTRODUCING THE VETERANS CHOICE ACT

Washington, D.C. ­– U.S. Senators John McCain (R-AZ), Tom Coburn (R-OK), Richard Burr (R-NC), and Jeff Flake (R-AZ) will hold a press conference to introduce the Veterans Choice Act TOMORROW, June 3, 2014 at 1:45 p.m. ET. The Veterans Choice Act addresses the most pressing issues raised by the scandal at the U.S. Department of Veterans Affairs by providing veterans with greater flexibility and choice in health care providers and increasing accountability and transparency at the VA.

TUESDAY, JUNE 2, 2014

WHO:    

U.S. Senator John McCain (R-AZ)

U.S. Senator Tom Coburn (R-OK)

U.S. Senator Richard Burr (R-NC)

U.S. Senator Jeff Flake (R-AZ)

WHAT: Press Conference introducing the Veterans Choice Act

WHEN: Tuesday, June 3rd – 1:45 p.m. ET

WHERE: Senate Radio/Television Gallery

S-325 – U.S. Capitol Building

###

 

May 2014

May 30 2014

Dr. Coburn’s Statement on Resignation of Sec. Shinseki

Says VA needs reform, not more funding

(WASHINGTON, D.C.) – U.S. Senator Tom Coburn, M.D. (R-OK) released the following statement regarding the resignation of Secretary of Veterans Affairs Eric Shinseki:

“The American people and our nation’s veterans need reform at the VA, not just resignations.  Further, more money is not the answer.  Funding for the VA has grown at more than three times the rate of inflation since 2009.  My office has also learned that at the end of Fiscal Year 2013, the VA held nearly $35 billion in unspent funds, which is more than the entire annual budget of the National Institutes of Health.  It’s long past time we gave our veterans the freedom they fought for.  I look forward to introducing legislation with Senators McCain and Burr that will accomplish that goal in the coming days,” Dr. Coburn said.

At the conclusion of Fiscal Year 2013, the VA held nearly $35 billion in unspent funds.  To give this amount some perspective, the entire annual budget of the National Institutes of Health (NIH) is $30.1 billion[1] -- billions of dollars less than the excess amount the VA leaves unspent at the end of every year.  The department is projected to end 2014 with another larger sum of unspent money, including nearly $5.9 billion in unobligated funds.[2] 

The VA “expects to carry over $450 million in medical-care funding from fiscal year 2014 to fiscal year 2015.”[3]  This is the fifth year in a row the VA has carried over funding for medical care.[4]  VA carried over $1.449 billion in medical-care funding from fiscal year 2010 to 2011, $1.163 billion from fiscal year 2011 to fiscal year 2012, $637 million from fiscal year 2012 to 2013, and $543 million from fiscal year 2013 to 2014.

###



[1] “NIH Budget: Research for the People,” National Institutes of Health website, accessed May 15, 2014; http://www.nih.gov/about/budget.htm .

[2] “Fiscal Year 2015 Balances of Budget Authority, Budget of the U.S. Government,” Executive Office of the President Office of Management and Budget, 2014;http://www.whitehouse.gov/sites/default/files/omb/budget/fy2015/assets/balances.pdf.

[3] Patrick Howley, “VA Expects To Have More Medical-Care Funding Than It Can Spend For The Fifth Year In A Row,” The Daily Caller, May 27, 2014;http://dailycaller.com/2014/05/27/va-expects-to-have-more-medical-care-funding-than-it-can-spend-for-the-fifth-year-in-a-row/ .

[4] Patrick Howley, “VA Expects To Have More Medical-Care Funding Than It Can Spend For The Fifth Year In A Row,” The Daily Caller, May 27, 2014;http://dailycaller.com/2014/05/27/va-expects-to-have-more-medical-care-funding-than-it-can-spend-for-the-fifth-year-in-a-row/ .

Dr. Coburn, along with 34 other Members of Congress, today sent a letter to the Congressional Leaders asking them to pledge their support for the continued ban on earmarks. The 2011 decision to end earmarks ensured that legislative priorities were focused on making decisions based on what is best for the nation as a whole, instead of on the individual needs of lobbyists and politicians.

The full text of the letter is below:

More than three years ago, members of Congress in both chambers from both parties stood together to impose a moratorium on the practice of congressional earmarking.

The American people celebrated this bipartisan leadership.  But, recently, we have noted that members on both sides of the aisle are calling for a return to earmarking.  We believe this would be unwise and would further damage Congress’ reputation and ability to tackle the nation’s challenges.

We recognize there are a wide range of views on this subject in our caucuses but we believe it is important to reaffirm our support for this policy.  Congress has ample flexibility to exercise its power of the purse and represent the interests of our constituents without using earmarks.  For instance, the appropriations process under regular order and our oversight authority gives members ample opportunity to set priorities and vet decisions with their elected peers.

We therefore urge you to pledge your continued support for the earmark moratorium and do everything in your power to work together to address the nation’s highest priorities without the unhelpful distraction of earmarks.

WASHINGTON, D.C. – Senate Republican Leader Mitch McConnell, joined by Sens. Orrin Hatch (R-UT) and Tom Coburn (R-OK), today urged the Department of Health and Human Services (HHS) Inspector General (IG) to carefully examine recent reports that the government may be paying incorrect Obamacare subsidies as the IG prepares to submit a mandated report to Congress by July 1.

In a letter to HHS IG Daniel R. Levinson, the lawmakers wrote that outgoing HHS Secretary Kathleen Sebelius may have incorrectly certified that the Obamacare exchanges verify that individuals receiving tax credits and cost-sharing assistance are actually eligible to accept those taxpayer-provided subsidies.

Sebelius certified to Congress in January that the exchanges could confirm that subsidy applicants are eligible to receive the benefits, and she detailed a number of measures that were supposed to be in place to protect the taxpayer. Congress passed a law that requires the HHS IG to issue a report by July 1 of this year evaluating the effectiveness of safeguards to prevent improper payments.

But a number of reports, including a recent story in The Washington Post and testimony from the Treasury Department’s IG for Tax Administration, indicate that many of the systems needed to ensure verification have yet to be built or used.  The Washington Post reported earlier this month that the government may be paying incorrect Obamacare subsidies to more than 1 million Americans for their health plans because the computer system capability that would match proof with the application hasn’t yet been built. The Treasury IG testified last month that some of the systems needed to prevent improper or fraudulent payments had not been completed, tested or deployed.

“These reports call into serious question the veracity of the Secretary’s certification that Exchanges will accurately verify an applicant’s eligibility for subsidies before they were issued,” wrote McConnell and Hatch, who is the ranking Republican on the Senate Finance Committee, and Coburn, the ranking member of the Senate Homeland Security & Governmental Affairs Committee. “It seems highly unlikely that the Secretary could accurately certify that systems were in place to verify the accuracy of applicant information, when in fact these systems had not been fully developed, tested, and deployed.” 

The lawmakers said they would “strongly encourage” the IG as he prepares his July 1 report, to carefully examine the media reports and Treasury IG testimony when evaluating the effectiveness of the procedures and safeguards the Secretary certified.

“Whatever one’s opinion of Obamacare, the American public deserves to know that their tax dollars are allocated appropriately and that public officials take their responsibility to accurately and faithfully apply the laws enacted by Congress seriously,” the lawmakers wrote.

Read the letter here.

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Senators Coburn, Enzi and Burr today sent letters to the Departments of Labor, Education, Veterans Affairs, and Defense asking for comprehensive data on the metrics and strategies used to oversee and guide and the agencies’ health care workforce training programs.  In April 2014, the senators also sent a letter to HHS asking for similar information.   

A 2013 GAO report found the federal government administers 91 different health care workforce programs, with total obligations of $14.2 billion in FY2012.

(WASHINGTON, D.C.) – Senators Tom Coburn (R-OK) and Claire McCaskill (D-MO) today introduced S. 2370, the Orphan Earmarks Act, to eliminate unused earmarks within the Department of Transportation (DOT). The bill would void earmarks of funds provided by DOT that have 90 percent or more remaining after 10 fiscal years as well as require DOT to submit an annual report on each project that uses earmarked funds and which funds remain available at the end of each fiscal year. 

The Congressional Research Service (CRS) found that continuing to fund unused earmarks results in an enormous amount of wasteful and unnecessary spending. “Even if Congress did not intend the grantees to have decades to decide whether to implement the projects, there is no budgetary mechanism to call attention to projects that are extremely delayed or to reallocate funding from inactive projects.  As a result, some amount of budgetary authority that states could otherwise use to address current transportation needs is not available for that purpose.”

“I have made it a top priority since joining the Senate to safeguard taxpayer dollars and put an end to the wasteful practice of earmarking,” McCaskill said. “Our country is facing an infrastructure crisis, and this bill could help chip away at that crisis by redirecting these orphaned funds, allowing us to invest in our roads and bridges, grow our economy, and create jobs throughout the country.” 

Eliminating waste within federal agencies should be a top priority for Congress as it looks for commonsense and bipartisan ways to reduce federal spending, increase government efficiency, and eliminate unnecessary duplication. 

Read the CRS report here.

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Fannie Mae and Freddie Mac’s recent weak profit reports coinciding with ominous stress tests are a stark reminder that the American taxpayers continue to be exposed to billions of dollars in risk from the government-backed duopoly.  I supported S. 1217 passage out of the Banking Committee today as an important first step to move the risk of our nation’s housing market off the backs of the taxpayers and onto a firm bedrock of a private capital driven, competitive, and diverse housing finance system.

I would be the first to support a proposal that completely removes the government from the housing market, but those desires must be matched with an honest declaration that such a reform will end the 30 year fixed rate mortgage.  In a body that cannot get rid of tax breaks for race horses, predicating housing finance reform on the abolition of the cornerstone of the U.S. housing market does nothing but keep the taxpayers on the hook for $5 trillion worth of Fannie Mae and Freddie Mac securities and guarantees – an ironic exercise of self-defeat.

Further, S. 1217 does not create a government guarantee on mortgage backed securities.  That guarantee has always existed since Fannie Mae was spun out of the federal government as a budget gimmick in 1968.  Rather, S. 1217 turns the previous implicit government guarantee into an explicit one and outlines that it can only be triggered after a massive amount of private capital losses that would provide more than enough protection to withstand another 2008-type crisis. 

While this bill still needs improvements prior to becoming law, especially reigning in the authority provided to the executive branch under unusual and exigent circumstances, it is past time that Congress stop making excuses and move forward with this long overdue reform.

Amendment #3066 - To strike the extension of the 7-year recovery period for motorsports entertainment complexes.

Amendment #3067 - To strike the extension of the special expensing rules for certain film and television productions and the special expensing rule for live theatrical productions.

Amendment # 3068 - To strike the extension of the classification of certain race horses as 3-year property. 

Amendment #3142 - To strike the extension and modification of the new market tax credit.

Amendment #3152 – To require transparency in the tax Code by requiring federally funded corporate tax benefits to be disclosed in the USASpending.gov website.

Amendment #3153 – To strike the extension and modification of the new markets tax credit.

Amendment #3160 – To require transparency in the tax Code by requiring federally funded corporate tax benefits to be disclosed in the USASpending.gov website.

May 07 2014

Dr. Coburn Launches Probe of Sequestration’s Impact

GAO discovers sequestration resulted in only one layoff

(WASHINGTON, D.C.) – U.S. Senator Tom Coburn, M.D. (R-OK) released the following statement today following revelations that sequestration resulted in only one layoff, according to the Government Accountability Office (GAO).  As GAO writes on page 51 of this report, “DOJ officials reported that one DOJ component—the U.S. Parole Commission—implemented a reduction in force of one employee to achieve partial savings required by sequestration in fiscal year 2013.”

“Despite relentless warnings about the dire consequences of sequestration’s budget cuts, it appears sequestration resulted in only one layoff.  While that’s good news for federal employees and other workers, it is devastating to the credibility of Washington politicians and administration officials who spent months – and millions of dollars – engaging in a coordinated multi-agency cabinet-level public relations campaign to scare the American people.  Taxpayers expect us to root our predictions in fact, not ideology and spin.  The facts seem to say the experts underestimated sequestration’s impact by between 99,999 and 1,599,999 jobs, according to two frequently-cited estimates by Goldman Sachs and the Congressional Budget Office,” Dr. Coburn said.

“Today, I’m sending a letter to the Office of Management and Budget with the hope of soliciting a fact-based explanation for the American people.  The American people deserve to know the truth, especially if it suggests politicians’ favorite programs can endure far more in budget cuts than sequestration imposed,” Dr. Coburn added.

The full text of the letter is below:

Dear Director Burwell,

I appreciate your leadership as the director of the Office of Management and Budget (OMB).  Your office has an important role in protecting and stewarding taxpayers’ resources.  Over the last three years, one of OMB’s most important responsibilities has been the implementation of sequestration, as mandated by the Budget Control Act of 2011.  Not only did OMB issue guidance on how departments should plan for the budgetary reductions, OMB also had some discretion in identifying which programs were subject to sequestration reductions.

The Budget Control Act is the law of the land until FY 2021, so it is essential to have a complete understanding of how agencies manage their workforces and operations in this constrained fiscal environment. 

Under OMB’s guidance, federal departments and agencies responded to sequestration in a variety of ways, as noted in a recent report by the Government Accountability Office (GAO).   Nearly every agency studied by GAO limited employee training and travel.  Most agencies used leftover funds from previous fiscal years to offset some of the mandated reductions.  NASA slowed down development of the program that will allow the U.S. to stop relying on Russia for trips to the International Space Station.  At the same time, NASA--like most agencies--did not furlough any employees.  Similarly, the National Science Foundation reduced the number of new research awards, but did not furlough any employees.  Almost no agencies directly reduced the number of staff.  Only one agency--the U.S. Parole Commission--implemented a reduction in force of one employee “to achieve partial savings,” according to GAO.  

To aid the understanding of the impact of sequestration on the federal workforce, please provide the following information by June 6, 2014:

1.         Broken out by fiscal year, please provide the number of permanent, federal civilian employees for the last five years?  Please include a breakdown by agency, position title, and pay scale. 

2.         Please provide a list of all departments or agencies that have implemented a reduction in force due to sequestration.  Please list any impacted positions, by fiscal year, position title and pay scale.

3.         Please provide electronic copies of any memoranda, guidance, or other documentation circulated by OMB advising federal agencies how to manage their federal workforces in response to sequestration. 

4.         What are the legal obstacles, if any, that hinder the executive agencies from making further reductions in workforce levels as they work to increase efficiency?

5.         What is OMB’s timeline for implementing GAO’s recommendation that OMB publish the criteria used to determine the exemption status of program, projects, and activities?

I know we share the goal of ensuring federal resources are used as effectively as possible, and I look forward to working with your office to address these questions. 

Sincerely,

Tom A. Coburn 

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Amendment #3003 - To encourage Federal employees to help reduce energy use and costs by turning the lights off at the end of the day. Additional information here.

Amendment #3004 - To require the Secretary of Defense to establish a searchable database on installation renewable energy projects. Additional information here.

Amendment #3005 - To require the Secretary of Energy to certify that Federal energy efficiency projects are cost efficient. Additional information here.

Amendment #3006 - To require the evaluation and consolidation of duplicative green building programs. Additional information here.

Amendment #3007 - To repeal the advanced technology vehicles manufacturing incentive program. Additional information here.

Amendment #3014 - To eliminate the corn ethanol mandate for renewable fuel. Additional information here

Amendment #3022 - To require certain agencies to conduct assessments of data centers and develop data center consolidation and optimization plans. Additional information here.

(WASHINGTON, D.C.) –  U.S. Senators and doctors Tom Coburn, M.D. (R-OK), John Barrasso, M.D. (R-WY), John Boozman, O.D. (R-AR), and Rand Paul, M.D. (R-KY) today introduced S. 2278, the Safeguarding Care of Patients Everywhere Act, to eliminate a provision from the Patient Protection and Affordable Care Act that allows the Secretary of HHS to prohibit health insurers from working with medical providers who don’t meet Secretary-established criteria for quality. A House version of the bill, authored by Representative Gingrey (R-GA), was introduced last year.

“A political appointee now has full discretion to determine what constitutes as ‘quality’ care, despite what is actually best for an individual patient,” said Dr. Coburn. “Allowing an unelected bureaucrat to have unilateral power to interfere with the physician-patient relationship is unprecedented.”

“This section of Obamacare highlights the law’s disregard for the sanctity of the doctor-patient relationship,” said Gingrey. “It is critical that Congress act to stop President Obama’s “one-size-fits-all” health policies that put HHS bureaucrats – unbound by the Hippocratic Oath – in charge of patient diagnoses and treatment procedures.”

Currently, the Secretary could decide to make certain policies part of a one-size-fits-all quality evaluation and these decisions may not be subject to review by state insurance commissioners, medical licensing boards, or professional societies. These decisions could essentially force providers out of practice, exacerbating the huge physician shortage our nation is already facing, and the harm will fall on the very patients the provision intended to help. This could result in patients losing their doctors and freedom to choose the treatments they need. The SCOPE Act amends this provision so that the Secretary of HHS does not have the ability to prohibit medical providers from conducting lawful business.

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Today, Senators Coburn, Enzi, Burr, and Ayotte sent a letter to the FDA, asking the agency about its plans for publication of draft guidance regarding generic abuse-deterrent formulations of opioids. 

It is essential to provide both innovator and generic manufacturers a clear understanding of what standards will be applied to their products as they go through the review process.   Not only has the agency not released any guidance regarding generic products, the agency has yet to finalize its January 2013 draft guidance regarding the approval and labeling of abuse-deterrent opioid drug formulations. Unclear or ineffective communication and guidance would undermine innovative efforts to combat our nation’s opioid abuse epidemic.

(WASHINGTON, D.C.) – U.S. Senators Tom Coburn, M.D. (R-OK) and Mark Udall (D-CO) today began circulating a bipartisan letter in support of the moratorium on congressional earmarking. The senators are urging members in the House and Senate to sign. The text of the letter is below:

More than three years ago, members of Congress in both chambers from both parties stood together to impose a moratorium on the practice of congressional earmarking.

The American people celebrated this bipartisan leadership.  But, recently, we have noted that members on both sides of the aisle are calling for a return to earmarking.  We believe this would be unwise and would further damage Congress’ reputation and ability to tackle the nation’s challenges.

We recognize there are a wide range of views on this subject in our caucuses but we believe it is important to reaffirm our support for this policy.  Congress has ample flexibility to exercise its power of the purse and represent the interests of our constituents without using earmarks.  For instance, the appropriations process under regular order and our oversight authority gives members ample opportunity to set priorities and vet decisions with their elected peers.

We therefore urge you to pledge your continued support for the earmark moratorium and do everything in your power to work together to address the nation’s highest priorities without the unhelpful distraction of earmarks.

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The vast majority of Americans do not want earmarks and Members of Congress need to take this threat seriously. The number of signatures this letter has represents how seriously Members are taking the threat. Here is a list of the Members who have signed on:

Senators McCain, Enzi, Coats, Flake, Toomey, Johanns, Grassley, Graham, Thune, Sessions, Ron Johnson, Ayotte, Paul, Burr, Cornyn, Cruz, Fischer, Vitter, McCaskill, Scott, Rubio, Corker, Barrasso, Risch, and Lee

Representatives Lankford (OK-05), Hensarling (TX-05), Duncan (SC-03), Pompeo (KS-04), DesJarlais (TN-04), Gosar (AZ-04), Ron DeSantis (FL-06) and Cooper (TN-05)

The Council for Citizens Against Government Waste supports our letter and have sent a letter urging Members of Congress to sign on. See the article here.

Taxpayers for Common Sense sent this letter urging Senators to support the earmark moratorium. 

April 2014

(WASHINGTON, D.C.) – U.S. Senator Tom Coburn, M.D. (R-OK) today hailed House passage the Digital Accountability and Transparency Act, a bill to increase the availability, accuracy, and usefulness on on-line information regarding Federal spending.  That bill will require each government program to disclose agency expenditures which enables taxpayers and policy makers to track Federal spending more efficiently.  The Senate passed the DATA Act earlier this month.  The bill will now go to the president for his signature. 

“The passage of this bill is important precisely because the bureaucrats in Washington don’t want it and have fought it every step of the way.  In many cases, the federal government doesn’t even know what they’re doing with their resources and now they will have to know in order to comply with this law.  I hope President Obama will sign this bill into law as soon as possible and force the federal government to provide a full and transparent accounting of their use of taxpayer funds,” Dr. Coburn said.

This bill will establish Government-wide data standards for financial data and provide consistent, reliable, and searchable spending data that is displayed accurately for taxpayers and policy makers on USASpending.gov.  By making government spending information easily accessible, this legislation will increase oversight to detect and prevent waste, fraud, and abuse while enabling individuals to more easily access and understand how Federal tax dollars are being spent.

The Senate bill was cosponsored by Sens. Kelly Ayotte (R-NH), Tom Carper (D-DE), Chris Coons (D-DE), Mike Enzi (R-WY), Ron Johnson (R-WI), John McCain (R-AZ), Patty Murray (D-WA), Rob Portman (R-OH), Mark Warner (D-VA), and Sheldon Whitehouse (D-RI).

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(WASHINGTON, D.C.) – Senators Tom Coburn (R-OK) and Chris Coons (D-DE) today introduced S. 2240, the Medicare Choices Empowerment and Protection Act, a bill to encourage Medicare beneficiaries to create advance directives. This will allow individuals to provide clear guidance to their medical providers and family members about their health care decisions should they become incapable of speaking for themselves.

“Advance directives are a valuable, voluntary tool that offers patients the ability to protect patients’ future health care preferences or to specify someone to act on their behalf. This bill would encourage their adoption by Medicare beneficiaries and is intended to start a discussion about how best to move this policy forward. We welcome constructive comments from stakeholders to improve this plan and to better encourage the voluntary adoption of advance directives by Medicare beneficiaries that can be accessible in real-time by their physicians and hospitals.”

"Every American deserves the opportunity to live his or her final days with dignity," Senator Coons said. "Too many Americans leave their end-of-life care to chance or to the preferences of distraught family members. This bill will help more Americans ensure they are the ones making the choices about their end-of-life care, reducing confusion and empowering more Americans to spend their final days and hours on their own terms. I am proud to work with Dr. Coburn on this bipartisan legislation and intend to work with all of my colleagues to see it become law."

Under the Medicare Choices Empowerment and Protection Act, Medicare beneficiaries would be able to voluntarily create and register an advance directive with CMS at any time.  Advance directives would be created through and maintained by outside organizations certified by CMS, and could be terminated at any time by the beneficiary. An advance directive would include any written statement that outlines the kind of treatment and care a beneficiary wants or does not want under certain conditions, and can include identification of a health care proxy.

To address concerns about confidentiality, the Medicare Choices Empowerment and Protection Act requires both CMS and outside groups maintaining advance directives to hold the highest standards for privacy and security protection as well as system functionality. CMS would only keep track of the certified organization through which a beneficiary has created an advance directive and would not keep a database of these documents. Beneficiaries would also receive a small, one-time incentive for registering an advance directive.

Additional information here.

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Senators Coburn, Enzi and Burr today sent a letter to HHS asking for comprehensive data on the metrics and strategy used to oversee and guide the agency’s 69 medical workforce programs, which together had obligations of $11.7 billion in fiscal year 2012.  They also asked about the department’s strategy for consolidating and streamlining these programs to make them more effective.

(WASHINGTON, D.C.) – U.S. Senator Tom Coburn, M.D. (R-OK) released the following statement today regarding the Government Accountability Office’s (GAO) fourth annual report detailing unnecessary duplication in the federal government.  This year’s report identified 26 areas of duplication that could save taxpayers $45 billion over five years.  See summary and report card for more information.

“Over the past four years, GAO’s duplication reports have identified a mother lode of potential savings – at least $200 billion annually.  Sadly, Congress has done very little digging.  We’ve achieved a small fraction of the savings GAO has revealed,” Dr. Coburn said.

“Turning this ready-made list of cuts into savings is one of the best ways Congress can regain the trust and confidence of the American people.  No American – regardless of party or ideology – wants to see their tax dollars fund unnecessary duplication and bloat, particularly when real incomes have flat-lined and our economy is being dragged down by a $17 trillion debt.

“A handful of members have taken up this cause including Representatives Paul Ryan, Jim Bridenstine, James Lankford, Virginia Foxx and Senator Tim Scott, but they need more support.  Congress could also pass two bipartisan bills based on GAO’s recommendations.  The Taxpayers Right to Know Act would require federal agencies to provide taxpayers with an annual report card for each of its programs and disclose overlap and performance measures.  The Let Me Google That For You Act would eliminate the National Technical Information Service (NTIS) that sells free government reports that are available online to other federal agencies and the public at a loss.

“At the end of the day, there are no short-cuts around the hard work of oversight and identifying and eliminating waste.  Congress, particularly the appropriations committees, has no excuse to not achieve these savings when GAO has already done much of Congress’ work for it,” Dr. Coburn said.

GAO began issuing these reports after Dr. Coburn attached an amendment to the debt limit increase in 2010.  The amendment was approved by a vote of 94 to 0. 

GAO’s previous three reports identified 162 areas of government duplication and cost savings.  To address these areas of concern, GAO recommended 380 specific actions to be taken by Congress and the administration to help reduce duplication, fragmentation, and overlap.  For additional background on GAO’s previous reports click here.

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(WASHINGTON, D.C.) – U.S. Senator Tom Coburn, M.D. (R-OK) released the following statement today regarding the Senate Select Committee on Intelligence’s vote to declassify Findings, Conclusions and Executive Summary of its study on the Central Intelligence Agency’s (CIA) Detention and Interrogation Program:

“I agree that some of the more extreme Enhanced Interrogation Techniques (EITs) could be considered torture, and that in the future this country should not rely on such techniques.  Yet, at the time, they had legal sanction.  Readers of the report will make their own judgments about how they were implemented.  I believe that the CIA acted imperfectly, but in good faith and under great urgency to prevent an attack from a little understood enemy that had brought devastation to our shores.

“The Committee report and its supporters judge a period in history.  However, I believe the Committee failed in its mission to understand, analyze and provide recommendations on the essential role of detention and interrogation intelligence in addressing ongoing threats.  Many modern and western nations have learned that detainee intelligence – both its collection and resulting analysis – is critical and primary in addressing threats from organized armed groups.  Had this report provided insights, guidance or recommendations on how to effectively conduct coercive but lawful interrogations against terrorist threats, it would have provided guideposts to the future, rather than just critiques of the past.  Successful intelligence, after all, is about mitigating future threats.”

“I voted present because the Chairman decided to limit the vote to the question of declassifying a report the Committee approved when I was not a Member of the Committee – it was a report I was never able to approve or disapprove – but I chose not to vote against declassification.  Regardless, I acknowledge that this report – and its dissenting Minority views, as well as the CIA’s response – will now become part of the public debate about a program that was terminated in the previous decade.  As the report, the dissenting views, and the CIA’s response will show, this report does not settle many issues, and the debates, both about history and the future, will continue.”

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(WASHINGTON, D.C.) – U.S. Senators Tom Coburn (R-OK) and Claire McCaskill (D-MO) and U.S. Representatives Jim Bridenstine (R-OK) and Henry Cuellar (D-TX) today introduced the Let Me Google That For You Act, a bill to eliminate an outdated agency that has lost more than $1 million trying to sell government reports that are available for free online. With a money-losing profit model only the government could design, the National Technical Information Service (NTIS) sells free government reports to other federal agencies and the public – at a loss.

“This is the ‘let me google that for you’ office of the federal government,” said Dr. Coburn.  “Nearly all of the reports being sold are already available for free on other government websites, including my own.  NTIS is selling at least six of the oversight reports issued by my office, such as the annual Wastebook which details outrageous Washington spending and mismanagement.  Ironically, the latest edition of Wastebook—which lists NTIS as one of the most wasteful government offices—is not available for sale yet by NTIS.  I have sent a letter to the Department of Commerce today requesting the office stop charging for the reports that I issue to taxpayers at no cost that highlight government waste, like the NTIS.”

“This agency has clearly outlived its usefulness,” said McCaskill, Chairman of the Senate Subcommittee on Financial & Contracting Oversight. “I find it staggering that the agency is selling government reports both to the public and to other federal agencies that are widely available for free and easy to find with a simple Google search—and the agency is still losing money. I think Americans would gain a little more confidence that their tax dollars are being spent wisely if we ended this display of waste and inefficiency. This is a government office performing a function that the advent of the Internet has made outdated, and it’s past time we eliminate it.”

“Only the Federal Government would attempt to sell what you can get for free, make no money, then subsidize the failure,” said Congressman Bridenstine. “I am proud to stand with Dr. Coburn in eliminating this office.”

“Voters send us to Washington to write effective legislation and make sure the federal government is operating in a responsible manner,” said Congressman Cuellar. “That a government agency is selling free reports to another part of the government and the general public is a prime example of federal overreach and inefficiency.  The Let Me Google That For You Act is an excellent step towards streamlining the way the government works and keeping Washington accountable.”

Last year, the Government Accountability Office highlighted NTIS’ operations, in its annual duplication report, finding, “Of the reports added to NTIS’s repository during fiscal years 1990 through 2011 … approximately 74 percent were readily available from other public sources.” Meanwhile, from 1995 to 2000, the office sold only 8 percent of the 2.5 million reports in its repertoire.  NTIS has lost on average at least $1.3 million over the last 11 year, running a deficit on its document production for nearly a decade.

Eliminating the office should be a top priority for Congress as it looks for commonsense and bipartisan ways to reduce federal spending, increase government efficiency, and act upon one of the GAO’s recommendations to eliminate unnecessary duplication. 

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The National Technical Information Service (NTIS) is the federal let me google that for you office, that is selling publically available reports, charging taxpayers and other agencies for access to these free reports. In fact, they are asking for up to $48 for several of Dr. Coburn’s own reports, including Wastebook, which is available for free on our website here.

Click here for the letter sent on April 2nd to NTIS asking them to stop charging for his reports.

Click here for the response from NTIS sent on April 10th.

Click here for Dr. Coburn's letter sent on April 23rd responding to NTIS requesting updated information regarding the agency, their contractors and the reports. 

Click here for additional information about NTIS. 

Apr 01 2014

Drs. Coburn & Barrasso Release New Report on Obamacare

Report also reviews the accuracy of their past diagnosis of the law

(WASHINGTON, D.C.) – U.S. Senators and doctors Tom Coburn, M.D. (R-OK) and John Barrasso, M.D. (R-WY) today released a new report entitled, “Prognosis: Outlook Not So Good” chronicling the scope of Obamacare’s failures and challenges.  The report also details what the senators and doctors got right and wrong about predictions they made in three previous oversight reports.  

“For millions of Americans, Obamacare itself has become a pre-existing condition that has limited their access to quality, affordable health care.  As we warned in our previous reports, Obamacare is fundamentally flawed.  The law strengthens the hand of government and weakens the hand of doctors and patients.  Obamacare is cutting choices, not costs, and costs will likely continue to rise,” Dr. Coburn said.

“As doctors, we know that Americans should be in charge of their own healthcare decisions - not Washington.  Over the past four years, we’ve highlighted the negative side effects of the healthcare law for patients, providers and taxpayers,” said Barrasso.  “Our new report confirms again exactly how Americans across the country are losing their insurance plan, watching their costs increase, and paying higher taxes.  It’s time to repeal this law and replace it with step by step reform that focuses on care instead of coverage.”

The report shows Coburn and Barrasso correctly predicted, among other things, that:

  • millions of Americans would lose their health insurance plans
  • the “employer mandate” would lower incomes and result in hundreds of thousands of jobs being lost
  • the law’s new mandates would increase health costs for individuals and families

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Amendment #2908 - To ensure that individuals do not simultaneously receive uneployment compensation and disability insurance benefits. Additional information here

Amendment #2909 - To prohibit Federal payments to States for unemployment compensation administration with respect to costs for office furnishings and murals, portraits, and other artwork. 

(WASHINGTON, D.C.) – U.S. Senators and doctors Tom Coburn, M.D. (R-OK) and John Barrasso, M.D. (R-WY) today released a new report entitled, “Prognosis: Outlook Not So Good” chronicling the scope of Obamacare’s failures and challenges.  The report also details what the senators and doctors got right and wrong about predictions they made in three previous oversight reports.  

“For millions of Americans, Obamacare itself has become a pre-existing condition that has limited their access to quality, affordable health care.  As we warned in our previous reports, Obamacare is fundamentally flawed.  The law strengthens the hand of government and weakens the hand of doctors and patients.  Obamacare is cutting choices, not costs, and costs will likely continue to rise,” Dr. Coburn said.

“As doctors, we know that Americans should be in charge of their own healthcare decisions - not Washington.  Over the past four years, we’ve highlighted the negative side effects of the healthcare law for patients, providers and taxpayers,” said Barrasso.  “Our new report confirms again exactly how Americans across the country are losing their insurance plan, watching their costs increase, and paying higher taxes.  It’s time to repeal this law and replace it with step by step reform that focuses on care instead of coverage.”

The report shows Coburn and Barrasso correctly predicted, among other things, that:

  • millions of Americans would lose their health insurance plans
  • the “employer mandate” would lower incomes and result in hundreds of thousands of jobs being lost
  • the law’s new mandates would increase health costs for individuals and families

 

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March 2014
Amendment #2867 - to eliminate a program that subsidizes the operation of the Russian Federation's weapons institutes. Additional information here.

Dr. Coburn and Senator Burr sent a letter to Minister Ambrose asking Health Canada to stop the production of an addictive non-abuse deterrent opioid that is banned in the U.S. Due to the proximity of our nations drugs can easily cross the border, legally and illegally.  By coordinating our regulatory approaches to this prescription medication the public health in both nations can improve while ensuring patients have access to the medicines they need. 

Mar 14 2014

Udall, Coburn Welcome Support for Proposal to End Unemployment Benefits for Millionaires as Part of Extension of Long-Term Jobless Benefits

Legislation Incorporates Bipartisan Duo's Common-Sense Idea to End Payments to Top Earners Who Need It Least

U.S. Senators Mark Udall (D-Colo.) and Tom Coburn (R-Okla.) applauded the long-overdue vote this week to end unemployment payments to millionaires. The extension of unemployment benefits that the U.S. Senate passed includedUdall and Coburn's bipartisan proposal to end wasteful unemployment payments to millionaires who need it least.

According to the Internal Revenue Service, millionaires claimed $90.6 million in unemployment benefits between 2009 and 2011.

"As Colorado and our nation recover from the recent recession, we need to have a serious discussion about reducing the federal budget deficit. Ending wasteful and unnecessary subsidies for the wealthiest among us is a bipartisan idea I have been proud to champion," Udall said. "I am glad my colleagues supported this common-sense and cost-cutting reform."

"The senate took two important steps this week to end welfare for well off: passing an amendment to prohibit childcare handouts for millionaires and putting forth a bipartisan proposal to stop paying unemployment benefits to millionaires," Coburn said. "Eliminating subsidies of the rich and famous in these and other programs is just one of the commonsense approaches Congress should be making to return commonsense to Washington's out of control budget that continues to spend money we do not have on things we do not need."

Under Udall and Coburn's proposal, individuals who made $1 million or more in adjusted gross income would be unable to claim unemployment benefits. This provision would go into effect immediately when the president signs it into law.

Udall and Coburn have been vocal advocates for fiscal responsibility and reducing the federal budget deficit. The bipartisan duo recently introduced a plan to end duplicative and wasteful federal programs. Udall and Coburn also have worked to pass a line-item veto authority to reduce wasteful spending andto end wasteful subsidies and earmarks.

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Washington—Senators Dianne Feinstein (D-Calif.), Tom Coburn (R-Okla.), Amy Klobuchar (D-Minn.) and Jeff Flake (R-Ariz.) today introduced the Patent Fee Integrity Act, a bill to protect and secure patent user fees paid by U.S. inventors and businesses and stabilize funding for the Patent and Trademark Office. 

            The bill protects the current user-fee system by placing those fees in a separate fund to prevent them from being raided for other purposes. Text of the legislation is available here

            The bill also includes provisions to ensure accountability for the PTO, requiring annual operations and spending plans be sent to Congress, as well as an annual independent financial audit. 

            “In 1990, Congress made the PTO a self-funded agency, but those funds are frequently plundered for other uses,” said Senator Feinstein. “Since then, more than $1.1 billion in user fees have been diverted. When fees paid by inventors are used for general purposes, they amount to a tax on innovation. Today’s bill prevents that from happening. If we fail to support the PTO and reduce delays in the patent process, we are contributing to a decline in American ingenuity, and that is something we should all work hard to avoid.” 

            “Keeping the funds at the Patent and Trademark Office is one the best ways Congress can take action on a jobs program,” said Dr. Coburn. “Instead of letting politicians in Congress raid PTO’s funds to pay for parochial pet projects, lawmakers should ensure that funds raised by patent fees stay at the PTO. Doing so will help shore up the PTO’s finances and alleviate the backlog of hundreds of thousands of potentially job-creating patent applications that are due a review.” 

            “Businesses deserve to know that the fees they pay will be used as intended and help improve the patent process—not diverted for unrelated purposes,” said Senator Klobuchar. “This bipartisan bill will help ensure the Patent and Trademark Office has the resources it needs to continue supporting innovative companies that are fueling growth and job creation in our economy.” 

            “I have long tried to ensure the Patent and Trademark Office is able to keep the fees it collects from U.S. inventors and businesses,” said Senator Flake. “The PTO needs these fees to ensure the timely and thorough review of patent applications. Delays in patent approvals stifles innovation and growth of businesses, and so Congress ought to do everything it can to ensure the PTO has adequate resources.” 

Background 

            For much of its history, funding for the Patent and Trademark Office was supported by taxpayer dollars. Then, in 1990, Congress established a 69 percent user fee “surcharge” to eliminate taxpayer funding.

            However, those funds are often used for other purposes. In 1992, $8.1 million in user fees were diverted. The amount diverted to non-patent issues increased steadily, rising to a high of $209 million in 2011. Since 1990, more than $1.1 billion in patent user fees have been diverted. 

            During those years, the length of time to secure a patent rose, from 18 months in 1991 to 35 months in 2010.

            The bill has wide support from the patent user community and has been endorsed by numerous large and small corporations and patent organizations.

                                                              

(WASHINGTON, D.C.) – U.S. Senator Tom Coburn, M.D. (R-OK) released the following statement on the Senate’s unanimous 100-0 vote to approve his amendment to the Child Care and Development Block Grant Act, S. 1086, that ends childcare subsidies for individuals whose assets exceed $1,000,000.

“The American people are compassionate.  But they expect their tax dollars to help those who need help rather than those who don’t.  This vote is an important victory for common sense and fairness.  The unanimous support this amendment received signaled the Senate’s support of income-testing as a way to save our safety net for poor families.  I trust my colleagues will apply the same logic to that difficult task ahead.”   

###

Amendment #2828 - To authorize to be appropriated to carry out the Child Care and Development Block Grant Act of 1990, $14,400,000,000 for the period consisting of fiscal years 2015 through 2020. Additional information here

Amendment #2829 - To require the evaluation and consolidation of duplicative early learning and child care programs, as identified by the 2012 Government Accountability Office report entitled “Opportunities to Reduce Duplication, Overlap and Fragmentation, Achieve Savings, and Enhance Revenue.” Additional information here

Amendment #2830 - To eliminate child care subsidies for millionaires. Additional information here

Amendment #2831 – To eliminate provisions for a toll-free Web site and hotline. Additional information here

Amendment #2832 – To eliminate child care subsidies for high-income individuals. Additional information here.

(WASHINGTON, D.C.) – U.S. Senator Tom Coburn, M.D. (R-OK) today introduced S.2113, the “Taxpayers Right to Know Act,” a bill that would require every federal agency to produce an annual report card for each of its programs.  The bill requires each government program to be identified and described, including the total administrative costs of the program, expenditures for services, number of beneficiaries who receive assistance from the program, and an estimate of the number of staff who administers the program; including contractor staff. The bill is backed by a majority of members on the Senate Homeland Security and Governmental Affairs Committee.  A House version of the bill, authored by Representative James Lankford (R-OK), passed late last month.

“Good-government bills like this are precisely what the American people want to see from Congress,” Dr. Coburn said.  “With at least $200 billion wasted on duplication across the government every year, Congress needs to demand accountability and transparency from the federal bureaucracy.  Sadly, most agencies don’t even know how many programs they administer. This bill will change that by requiring agencies to document their programs and activities.  I am pleased the House has already passed this commonsense measure and am hopeful Senate Majority Leader Reid does not block consideration of this bipartisan Senate bill.”   

In a hearing on government management held today in the Homeland Security and Governmental Affairs Committee, GAO head Gene Dodaro called for a comprehensive inventory of federal programs in order to enhance management practices and reduce fragmentation, overlap and duplication.

The bill is cosponsored by Sens. Kelly Ayotte, (R-NH), Mark Begich (D-AK), Richard Burr (R-NC), Saxby Chambliss (R-GA), Susan Collins (R-ME), Ted Cruz (R-TX), Mike Enzi (R-WY), Jeff Flake (R-AZ), Orrin Hatch (R-UT), Jim Inhofe (R-OK), Ron Johnson (R-WI), John McCain (R-AZ), Claire McCaskill (D-MO), Rand Paul (R-KY), Rob Portman (R-OH), Tim Scott (R-SC), Jim Risch (R-ID), David Vitter (R-LA), and Mark Warner (D-VA).

This bill would address this overlap and unnecessary duplication by also requiring the following: a listing of other programs within the federal government with duplicative or overlapping missions and services; the latest performance reviews for the program, including the metrics used to review the program; the latest improper payment rate for the program, including fraudulent payments; and the total amount of unspent and unobligated program funds held by the agency and grant recipients. This information would be updated annually and posted on-line, along with recommendations from the agency to consolidate duplicative and overlapping programs, eliminate waste and inefficiency, and terminate lower priority, outdated and unnecessary programs.

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(WASHINGTON, D.C.) – U.S. Senators Tom Coburn, M.D. (R-OK) and Mark Udall (D-CO) today applauded the Senate’s unanimous passage of H.R. 2019, a bill that eliminates taxpayer financed political party conventions.  The bill redirects the savings to provide for a 10-year pediatric research program to be administered by the National Institutes of Health.

 “The party is over for Washington politicians,” Dr. Coburn said.  “Hardworking taxpayers will no longer have to fund summertime party junkets for the political class.  I want to thank Leaders Reid and McConnell for their support of this measure and for agreeing to pay for new spending for pediatric medical research by eliminating spending for political conventions.  Reid’s decision, in particular, sets an important precedent – and reverses past resistance – by paying for new spending by reducing spending elsewhere.  Historically, Washington has considered that principle to be unusual.  But in the real world it’s called common sense and living within your means.  We need more of that in Washington. I look forward to the President quickly signing this bill into law so this egregious practice can end once and for all.” 

“I have long fought to end public subsidies for national political party conventions, which have become nothing more than elaborate parties. I am proud Congress finally heeded my call and passed this bipartisan proposal,” Udall said. “This common-sense idea will  help save millions of dollars — and the president should sign it into law without delay.”

Coburn and Udall have worked together to prohibit the use of Presidential Election Campaign Funds (PECF) for political party nominating conventions, including introducing legislation last year and in the previous session of Congress.

Dr. Coburn previously listed taxpayer-funded conventions as the number one most wasteful item in his 2011 Wastebook.

In June of 2012, Dr. Coburn’s amendment to S. 3240, the Agriculture Reform, Food, and Jobs Act of 2012, passed the Senate 95-4.  However, the measure was never signed into law. 

In early 2013, Dr. Coburn introduced a bill to eliminate the use of public funds for political party conventions, cosponsored by Sen. Udall.

###

WASHINGTON – Today, Senate Homeland Security and Governmental Affairs Committee Chairman Tom Carper (D-Del.) and Ranking Member Tom Coburn (R-Okla.) released a statement following the confirmations of Suzanne E. Spaulding to be Under Secretary, Department of Homeland Security and John Roth to be Inspector General, Department of Homeland Security. The Senate confirmed both nominees by voice vote:

Chairman Carper: “I’d like to thank my colleagues for filling these positions, which have responsibilities critical to the Department of Homeland Security’s mission. I would also like to thank these nominees for their willingness to serve our nation. I believe they represent the types of qualities we want to see in our government leaders.”

Dr. Coburn: “I am pleased the Senate has filled these two important vacancies at DHS.  Both are instrumental to facilitating vigorous oversight of the agency.”

Suzanne E. Spaulding, Under Secretary, Department of Homeland Security

Chairman Carper: “The National Protection and Programs Directorate is the component charged with the responsibility of securing our nation’s critical infrastructure from physical and cyber attacks. Leading a sector with such a vital mission is no easy task. That’s why I am pleased that my colleagues have confirmed a strong leader in Suzanne Spaulding. Ms. Spaulding has a rich background in both government service and the private sector.  As the Acting Under Secretary for the National Protection and Programs Directorate, she has brought a direct and engaged management approach to some of the Department’s most important missions and she is well-prepared to fill the role permanently. Her distinguished career, intellect, and professionalism will serve her well in this next step, and I look forward to working with her on efforts to enhance our nation’s defenses on our cyber and other critical systems.”

Dr. Coburn: “I look forward to working with Under Secretary Suzanne Spaulding on increasing transparency at DHS and establishing targeted, risked-based security mechanisms that allocate resources where they are most needed.  Her previous experience at the department also makes her an asset in improving cybersecurity for the federal government’s own critical IT systems - something that is long overdue.”

John Roth, Inspector General, Department of Homeland Security

Chairman Carper: “In an agency as large and important as the Department of Homeland Security, the Office of the Inspector General is a critical ally in the fight to ensure that taxpayer funds are protected and to deter or punish possible impropriety.   It is vital to have a permanent, Senate confirmed leader in this office to ensure that it has the authority and legitimacy needed to conduct comprehensive investigations. Fortunately, today, the Senate confirmed John Roth as Inspector General – a position that’s been without Senate confirmed leadership for three years. The role of Inspector General a demanding and important job but I believe Mr. Roth is well qualified for the challenges before him. His impressive career and commitment to public service, as well as his intellect, work ethic and integrity, are badly needed in a role that can be difficult and pose unique challenges. I look forward to working with him as he works to strengthen the Office of Inspector General and, with it, the Department of Homeland Security.”

Dr. Coburn:  “DHS needs a strong IG to conduct investigations and shed light on its many programs.  As DHS IG, John Roth will be a valuable asset for whistleblowers, the Committee, and Congress alike in uncovering waste, fraud, and abuse within the department. I look forward to building off his findings with legislation that fixes the problems at DHS.”

###

February 2014

Amendment #2758:   Requires the VA to publish information on the provision of health care, including delays in care and outcomes of medical services. Additional information here.

Amendment #2759: To strike section 301, relating to the expansion of eligibility for VA coverage to those currently not eligible. Additional information here.

Amendment #2760: To allow veterans to go to the health care provider of their choice. Additional information here.

Amendment #2761: To require the VA to carry out a pilot program to provide health care and services to individuals through non-VA entities to ensure more timely care with better outcomes for veterans currently experiencing excessive delays in accessing care. Additional information here.

Amendment  #2762: To limit the implementation of new programs and expansion of existing programs until the VA meets certain metrics, including reduced wait times and increased quality of medical care for our national heroes. Additional information here.

Additional Information on the bill and the VA:

Additional information on the Veterans Omnibus here.

Congressional micro-mismanagement harming veterans here

Veterans suffering at VA facilities here.

VA mismanagement and waste here.

Waiting times and delays for veterans care here.

Feb 26 2014

Coburn Releases New Health are Cost Report

Report Finds Exponential Growth from Initial Cost and Enrollment Figures

(WASHINGTON, D.C.) – U.S. Senator Tom Coburn, M.D. (R-OK) today released a new report entitled, “The History of Federal Health Care Spending,” which outlines a comparison of original and current federal health care program outlays.  The report looks at Medicaid, Medicare, defense health programs, veterans’ medical care, and other health programs like Indian Health Service and State Children’s Health Insurance Program (CHIP).  The report’s findings show federal spending on health care programs usually outpaces economic growth – often exponentially. 

“This report card shows the growth of federal health spending in program after program is exponential and unsustainable,” Dr. Coburn said.  “Yet, instead of dealing with the core drivers of our debt, Washington continues to create new health care programs and expand existing ones.  Congress needs to focus on keeping – and paying for – the promises we have already made instead of making new promises we can’t afford.” 

The report uses Office of Management and Budget (OMB) data and the President’s FY 2014 Budget to compare initial program outlays to outlays in 2012.   These figures are adjusted for inflation. 

For example, OMB has said that Medicaid cost $800 million in 1966 and covered 4 million enrollees.  In 2012, according to OMB, Medicaid cost $250 billion and had more than 55 million enrollees – a cost increase of $249.7 billion or 31,213%. 

The report acknowledges increased costs and enrollment is attributable to a combination of general population increases, as well as legislative and regulatory expansions, and other demographic and economic factors.  

The report also separately notes estimates, appropriations, and outlays – varying in their quality and specificity – for initial program spending as obtained by the Congressional Research Service (CRS).  These figures are not adjusted for inflation. 

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Dr. Coburn released the following letter on his hold regarding S. 653, the Near East and South Central Asia Religious Freedom Act of 2013. 

February 25, 2014

 

The Honorable Mitch McConnell

Senate Minority Leader

United States Senate

Washington, D.C.

Dear Senator McConnell:

I am requesting I be consulted before the Senate enters into any unanimous consent agreements or time limitations regarding S. 657, the Foreign Prison Conditions Improvement Act of 2013.

While I support the intent of this legislation, I believe if Congress decides to spend American taxpayer dollars on prisons, those taxpayer dollars should be spent on improving our own correctional facilities.  Furthermore, there does not appear to by any Constitutional role for Congress to spend American taxpayer dollars on improving conditions at foreign prisons, nor would this proposed expenditure enhance our own national security, or assist foreign nations in enhancing their own law enforcement capabilities. 

Also, the Congressional Budget Office (CBO) estimates that enacting this bill will increase discretionary spending by $695 million over five years, and I want to ensure there is a clear offset for this additional cost.  I remained concerned that we continue to fund new programs, particularly foreign aid programs, without prioritizing our spending.  We could easily find $695 million in current spending on low-priority or under-performing initiatives to offset this cost. 

The U.S. national debt is $17 trillion, and despite pledges to control spending, Washington instead adds billions to the national debt every day.  Congress must start making tough choices and stop jeopardizing the future standard of living of our children by borrowing from future generations.                                                                              

Sincerely,                               

Tom A. Coburn, M.D.

United States Senator

(WASHINGTON, D.C.) – U.S. Senators Tom Coburn, M.D. (R-OK), John Barrasso, M.D. (R-WY), John Boozman, O.D. (R-AR), Rand Paul, M.D. (R-KY) today sent Centers for Medicare & Medicaid Services (CMS)  Administrator Marilyn Tavenner a letter questioning CMS’ plan to perform front-end testing of the ICD-10 billing code system during the week of March 3, 2014.

“Given the size and scope of the potential transition to ICD-10, the brevity and limited scope of this test is worrisome.  This change will impact millions of physicians and patients, and hundreds of billions of dollars in payments that flow through Medicare and Medicaid.  Other major federal IT projects--such as the implementation of Healthcare.gov--have demonstrated the importance of thorough pre-testing every aspect of new systems, both the front-end and back-end components.  System-wide errors and delay could adversely impact both patients’ own pocketbooks and provider cash flows,” the Senate doctors wrote.

The Senate doctors previously introduced the Cutting Costly Codes Act, S. 972, which would prohibit HHS from moving forward with the ICD-10 transition.

The full letter is below:

 

  February 18, 2014

    

Marilyn Tavenner, Administrator

Centers for Medicare & Medicaid Services

200 Independence Avenue, S.W.

Washington, D.C. 20201

 

Dear Administrator Tavenner:

 

We write with concern about the Centers for Medicare & Medicaid Services’ (CMS) plan to perform front-end testing of the ICD-10 billing code system during the week of March 3, 2014.  Given the size and scope of the potential transition to ICD-10, the brevity and limited scope of this test is worrisome.  This change will impact millions of physicians and patients, and hundreds of billions of dollars in payments that flow through Medicare and Medicaid.  Other major federal IT projects--such as the implementation of Healthcare.gov--have demonstrated the importance of thorough pre-testing every aspect of new systems, both the front-end and back-end components.  System-wide errors and delay could adversely impact both patients’ own pocketbooks and provider cash flows.  In fact, CMS’ own documentation warns providers to “[e]stablish an emergency fund to cover unexpected costs and possible reimbursement delays.”

 

The significance of this transition can hardly be overstated.  The economic impact of the ICD-10 transition on insurers and medical providers will be billions of dollars.  The Association of Health Insurance Plans has estimated the total cost just for health insurance companies could be as high as $3 billion.  A recent report to the American Medical Association found the impact of the transition to be $83,290 for a small practice and $2.7 million for a large one.  Before either Medicare or Medicaid could conceivably transition to any new diagnostic coding method, CMS must establish clear metrics and perform system-wide tests to certify its readiness. 

 

We ask you would assist our oversight of CMS’ planned transition to the ICD-10 coding system by answering the following questions:

 

1.         What metrics will CMS use to evaluate the success of the ICD-10 testing period in March?  What are the targets CMS has set for each of these metrics to determine whether the testing period was successful?

 

2.         Will the testing period allow Medicare providers to test accurate and prompt claim adjudication?  If not, does CMS plan on executing more testing periods before full implementation (currently scheduled for October 1, 2014) to ensure claims can be accurately submitted and paid under ICD-10?

 

3.         Before full implementation, does CMS plan to test the appeal process for claims submitted due to incorrect ICD-10 codes as providers and staff transition to the new system?

 

4.         When does CMS plan to release results from the testing period to the public, so that providers and other entities may make necessary changes to their systems? 

 

5.         How will CMS measure the ICD-10 readiness of Medicare Administrative Contractors (MAC) and state Medicaid agencies before full implementation?  Will CMS require MACs and Medicaid to demonstrate successful end-to-end testing before all providers have to switch to ICD-10?  What is the current ICD-10 readiness of these entities?

 

6.         Provide a list of any internal or third-party testing CMS has scheduled before full implementation of the ICD-10 coding system.

 

7.         Will CMS perform full testing of Recovery Audit Contractors (RAC), the Fraud Prevention System (FPS), and other anti-fraud efforts to ensure full capability to perform anti-fraud investigations?  If so, what metrics and targets will CMS use to ensure ICD-10 readiness of RACs and the FPS?

 

8.         When will CMS release a crosswalk of Local Coverage Determinations and all other Medicare claim transaction edits associated with ICD-10 codes?

 

9.         How often has CMS studied the ICD-10 readiness of the providers and other third parties?  What industry analyses or surveys is CMS relying on for information on the ICD-10 readiness of providers and other third parties?

 

10.       Has studied CMS the impact the ICD-10 transition may have on upcoding?  Describe the results of any findings.

 

Thank you for your cooperation in our review.  Given the imminence of the testing period, we respectfully request you would submit answers no later than February 26, 2014.

Sincerely,

Tom A. Coburn, M.D.                                                            Rand Paul, M.D. U.S. Senator                                                                             U.S. Senator

John Barrasso, M.D.                                                       John Boozman, O.D. U.S. Senator                                                                             U.S. Senator                                                                                                                

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Dr. Coburn sent a letter to Inspector General Scott Dahl of the U.S. Department of Labor expressing his concerns regarding the wasteful spending practices within the Department.  

(WASHINGTON, D.C.) – U.S. Senator Tom Coburn, M.D. (R-OK), ranking member of the Homeland Security and Governmental Affairs Committee, today highlighted a new report from the Government Accountability Office (GAO) that examines ammunition procurement practices at the Department of Homeland Security.  The report found that since 2009, ammunition purchases at the department have declined.  DHS currently has more than 70,000 firearm-carrying personnel.

“Today’s GAO report provides much-needed oversight into DHS’s ammunition procurement practices,” Dr. Coburn said. “Specifically, the GAO looked at DHS’s history of ammunition purchases and found that purchases have declined considerably since 2009.  The GAO also highlighted a number of positive safeguards DHS uses in its procurement practices such as strategic sourcing in order to secure the lowest prices for ammo. I am pleased DHS has worked in good faith, and in a transparent manner, with both myself and the GAO.  I will continue to conduct rigorous oversight of DHS programs and will specifically work with Congress and the GAO to examine how duplicative federal police forces cause excess and waste across the federal government.”

Dr. Coburn’s previous oversight work on DHS ammunition purchases can be found here.

House Homeland Security Committee Chairman Michael McCaul and House Subcommittee on Oversight and Management Efficiency Chairman Jeff Duncan were lead requestors on the report.

Findings include:

  • Overall, the GAO found that DHS ammunition purchases have declined since 2009 as the chart illustrates below:  

Year

Number of rounds (in millions)

DHS total cost (in millions)

FY 2008

125.8

$27.4

FY 2009

132.9

$33.8

FY 2010

117

$31.6

FY 2011

100.3

$30.2

FY 2012

96

$30.3

FY 2013

84.4

$19.2

FY 2014 (planned)

75.1

$22.7

 

  • From fiscal years 2008 through 2013, DHS purchased an average of 109 million rounds of ammunition for training, qualification, and operational needs.  This 6 year period equates to an average of 1,200 rounds of ammunition purchased per firearm-carrying officer per year. 
  • According to DHS contract data, as of October 2013, 29 ammunition contracts existed which have a remaining balance of around 704 million rounds.  These contracts have a contract dollar ceiling of around $285 million. 
  • In August 2012, DHS required components to use strategic sourcing contract vehicles for procurements, which include ammunition.  DHS officials believe that the strategic sourcing process for ammunition has saved an estimated $2 million since 2008. 

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Dr. Coburn, along with Senators McConnell and Alexander, today sent a letter to the FDA asking them to respond to questions regarding safeguards accompanied with the production of a powerful hydrocodone product. A response from the FDA can be found here

 

(WASHINGTON, D.C.) – U.S. Senator Tom Coburn, M.D. (R-OK) today sent a letter to IRS Commissioner John Koskinen asking the agency to clarify how it will enforce the Patient Protection and Affordable Care Act’s individual mandate tax.  Sens. Lamar Alexander (R-TN), John Barrasso (R-WY), John Cornyn (R-TX), Jerry Moran (R-KS) and Jeff Sessions (R-AL) cosigned the letter. 

The full text of the letter is below:

 February 10, 2014

 

John Koskinen

Commissioner

Internal Revenue Service

1111 Constitution Avenue, NW

Washington, D.C. 20230

 

Dear Commissioner Koskinen: 

At the turn of the year, we crossed a new threshold in federal policy. The Patient Protection and Affordable Care (ACA, also known as “Obamacare”) now mandates individuals who choose not to purchase health insurance be subject to taxation by the Internal Revenue Service (IRS).[1] 

Never before – since the founding of our Republic – has Congress adopted and the courts upheld a law which effectively forces Americans to buy a product they may not want and subjects them to a tax if they choose not to do so.  Given the unprecedented nature of this new era, we write with several questions regarding the Internal Revenue Service’s efforts to enforce section 5000A of the Internal Revenue Code, or the “individual mandate.”  

We note the Inspector General for Tax Administration (TIGTA) report released on November 8, 2013, which identifies the implementation of ACA’s tax law changes as the second highest management and performance challenge for the Agency.[2]  Certainly, administering the 21 new taxes in the law – which are estimated to raise more than $1 trillion in revenue over the coming decade – will be a challenge.  However, the individual mandate is more than just another tax included in the law to pay for expensive health insurance coverage.  According to many supporters of the ACA, the individual mandate tax is an essential component for the health care law to work. 

Yet the individual mandate tax is one of the most unpopular provisions in the federal health law.  Millions of Americans deeply resent how the ACA raises the cost of their health care coverage, reduces their coverage options, and effectively dictates the type of coverage they must buy – and taxes them if they do not buy it.  Certainly, in the coming months many Americans will also have strong feelings about how the IRS enforces the individual mandate tax. 

Given a number of last-minute administrative “adjustments” made by the Administration, there is some understandable confusion and concern about the enforcement of the individual mandate tax. With the Administration’s decision to waive, delay, or unilaterally alter some provisions of the law—including the employer mandate tax on businesses—taxpayers deserve clarification on how the agency intends to enforce the individual mandate tax. 

In order to clarify the IRS’s enforcement of the individual mandate tax, as well as any outstanding issues that need to be addressed by Congress and the IRS, please respond to the following questions: 

  1. Under the law, the IRS does not have the authority to file a notice of federal tax lien or bring forth criminal prosecutions in order to enforce the tax payment.
  2. Please describe the methods the IRS intends to use to enforce payment of the tax.
  3. The Congressional Research Service (CRS) states “it is possible that the IRS could present its claim when property is being sold and collect both the original penalty amount along with accrued interest and applicable penalties.”[3]  Does the IRS plan to do this?
  4. CRS also notes “it is unlikely that the IRS will assess the penalty on a return before routine processing of the return is completed.  Accordingly, the taxpayer may have received in full the refund anticipated and reported on the return for which the penalty should have been calculated but was not.”  In light of CRS’ statement, does the IRS anticipate taking the tax from a person’s refund would be an effective method for ensuring compliance with the individual mandate tax?
  5. The ACA authorizes the Secretary of Health and Human Services (HHS) to exempt an individual from the individual mandate tax if he or she has “suffered a hardship with respect to the capability to obtain coverage under a qualified health plan.”[4]  The Administration subsequently announced late in 2013 that individuals whose insurance policy had been canceled would be eligible for a hardship exemption in 2014.  Does the IRS intend to enforce the tax on individuals who have been unable to access the HealthCare.gov or state exchange websites? Will individuals who completed all the steps to purchase health insurance, but were not enrolled due to a website error be required to pay the tax?
  6. The Administration has already announced several exemptions to the individual mandate.  In fact, according to HealthCare.gov, there are eight separate exemptions, along with an additional thirteen circumstances that could qualify a person for a hardship exemption. Assuming the taxpayer can identify the correct exemption, they must either claim the exemption on their tax return or complete one of eight separate forms provided by the government.  To make matters more confusing, those who are not required to file a tax return do not even need to apply for an exemption.  If the taxpayer meets one or more of these exemptions, but unknowingly pays the tax, will the IRS refund the payment?[5] 
  7. How will the IRS verify the information provided regarding a person’s enrollment in a qualified health plan is accurate?  In addition, if a person has a gap in coverage that is less than three months, they are not required to comply with the individual mandate.  How does the IRS intend to verify the coverage gap did not exceed the three-month threshold?
  8. According to CRS, the IRS often conducts “correspondence audits in which the taxpayer is asked to provide additional information to support the information on the tax return.”[6]  Does the IRS plan to ask any, or all, taxpayers for supporting documentation to verify the taxpayer has health insurance meeting the minimum essential coverage requirement?
  9. In light of TIGTA’s November 13, 2013, memorandum, does the IRS currently have the personnel and infrastructure in place to equitably enforce the individual mandate in 2014?  What steps does the IRS still need to complete to be able to enforce the tax, and when will these steps be completed?

 

Given the importance of ensuring that the law is enforced in a transparent and accountable manner, please respond to our letter within 15 days of receipt.  Meanwhile, do not hesitate to contact our staff regarding any questions you may have.  We look forward to your response to these important questions.    

Sincerely,

 

   

 

  

Tom A. Coburn, M.D.                                                           Lamar Alexander

U.S Senator                                                                              U.S Senator

 

Jeff Sessions                                                                            John Cornyn

U.S Senator                                                                               U.S Senator

 

John Barrasso, M.D.                                                                    Jerry Moran

U.S Senator                                                                               U.S Senator

                    

###

 

 



[1] We recognize the law and its accompanying regulation outline certain individuals (and their dependents) who may be exempt from the penalty. For example, individuals whose household income is less than the filing threshold for federal income taxes for the applicable tax year (filing threshold exemption), as well as those whose required contribution for self-only coverage for a calendar year exceeds 8% of household income (affordability exemption), will be exempt. Additionally, certain categories of individuals will be exempt from the individual mandate, including those with qualifying religious exemptions, those in a health care sharing ministry, individuals not lawfully present in the United States, and incarcerated individuals (except those pending the disposition of charges). Moreover, no penalty will be imposed on those without coverage for less than three months or members of Indian tribes.

[2] “Management and Performance Challenges Facing the Internal Revenue Service for Fiscal Year 2014,” Department of the Treasury: Inspector General for Tax Administration, November 8, 2013, http://www.treasury.gov/tigta/management/management_fy2014.pdf.

[3] “The PPACA Penalty Provision and the internal Revenue Service,” Congressional Research Service, April 30, 2010, http://www.coburn.senate.gov/public/index.cfm?a=Files.Serve&File_id=2ec1e180-afbf-4a48-ba12-8dea812ac30a.

[4] P.L. 111-148, § 1411(b)(5).

[5] “Questions and Answers on the Individual Shared Responsibility Provision,” Internal Revenue Service, http://www.irs.gov/uac/Questions-and-Answers-on-the-Individual-Shared-Responsibility-Provision.

[6] “The PPACA Penalty Provision and the internal Revenue Service,” Congressional Research Service, April 30, 2010, http://www.coburn.senate.gov/public/index.cfm?a=Files.Serve&File_id=2ec1e180-afbf-4a48-ba12-8dea812ac30a.

Additional information on the Veterans Omnibus here.

Congressional micro-mismanagement harming veterans here

Veterans suffering at VA facilities here.

VA mismanagement and waste here.

Waiting times and delays for veterans care here.

Dr. Coburn sent a letter to Vice President Biden regarding the duplication within the federal job training programs.  In the letter, Dr. Coburn commends the President for seeking to consolidate duplication and encourage him to work with Congress to achieve these goals. 

In 2011, Dr. Coburn released the report “Help Wanted” that highlights examples of waste, fraud and mismanagement in federal job training programs.

In 2012, Dr. Coburn released an oversight report on job training programs in Oklahoma entitled, “What Works (and What Doesn’t): The Good, Bad and Ugly of Federal Job Training in Oklahoma.” This report follows a groundbreaking study from the Government Accountability Office that found taxpayers are spending $18 billion on 47 duplicative job training programs across 9 federal agencies. GAO could not find evidence that any of the job training programs were working.

(WASHINGTON, D.C.) – U.S. Senator Tom Coburn, M.D. (R-OK), ranking member of the Homeland Security and Governmental Affairs Committee, today released a new report: “The Federal Government’s Track Record on Cybersecurity and Critical Infrastructure.”  The report details serious vulnerabilities in the government’s efforts to protect its own civilian computers and networks, and the critical, sensitive information they contain.  The report notes that “Since 2006, the federal government has spent at least $65 billion on securing its computers and networks, according to an estimate by the Congressional Research Service.”

 “Weaknesses in the federal government’s own cybersecurity have put at risk the electrical grid, our financial markets, our emergency response systems and our citizens’ personal information,” Dr. Coburn said.  “While politicians like to propose complex new regulations, massive new programs, and billions in new spending to improve cybersecurity, there are very basic – and critically important – precautions that could protect our infrastructure and our citizens’ private information that we simply aren’t doing.” 

The report compiles problems identified in over 40 audits, investigations and reviews by agency Inspectors General, the Government Accountability Office and others.  In many cases, simple fixes like using stronger passwords, and applying patches and updates in a timely manner, would fix critical vulnerabilities.

“More than a decade ago, Congress passed a law making the White House responsible for securing agency systems.  It’s still not happening,” Dr. Coburn added. “They need to step up to the job, and Congress needs to hold the White House and its agencies accountable.” 

The report highlights numerous government cyber failures, including: 

-          Last February, hackers broke into the U.S. Emergency Alert System and broadcast warnings of zombie attacks to several U.S. cities.

-          Internal Revenue Service computers were been found to have literally thousands of serious vulnerabilities because critical software patches have not been installed.

-          In 2012, the Securities and Exchange Commission mishandled and potentially exposed critically sensitive information, including diagrams of how to hack into trading exchanges. 

To read the full report, click here.

CRS Memo on FISMA spending here

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January 2014

Jan 30 2014

BURR, COBURN, HATCH: ANALYSIS SHOWS THERE IS A BETTER WAY THAN OBAMACARE

Analysis by The Center for Health Economy Finds Senators’ Patient CARE Act Will Lower Costs, Provide More Coverage, Improve Health Care System, Reduce Debt

WASHINGTON – Today, The Center for Health Economy released an economic analysis that found that the Patient Choice, Affordability, Responsibility, and Empowerment (CARE) Act - a legislative plan put forward this week by Senators Richard Burr (R-N.C.), Tom Coburn, M.D. (Okla.), and Orrin Hatch (R-Utah) – reduces health care costs, lowers premiums, provides more Americans with health care coverage than Obamacare. The analysis found the proposal also increases health care productivity and reduces the nation’s debt.

“In his State of the Union speech the President spoke about his signature domestic achievement, Obamacare.  He said if anyone has a health care plan out there that cuts costs, covers more people and increases choices, to show him the numbers to see if they add up.  Mr. President, we have a plan that will add up to lower costs, more choices and cover Americans with pre-existing conditions,” Burr, Coburn and Hatch said today.  “Today’s analysis shows there is a better way than Obamacare.  Our plan gives individual Americans greater control over their own health care and asks government bureaucrats to leave the exam room.  Using smart insurance market reforms, putting small businesses more on par with Fortune 500 companies, and giving individuals – not government – more tools to make the best decisions for themselves is a prescription for success.“

The analysis by The Center for Health Economy specifically found that the Patient CARE Act:

  • Cuts Costs:  The Patient CARE Act, compared to current law, will save almost $1.5 trillion over 10 years.
  • Lowers Premiums:  The Patient CARE Act will reduce premiums across the board for Americans compared to current law, with the individual insurance market seeing the biggest reductions of up to 11 percent for single policies.
  • Expands Coverage:  The Patient CARE Act would cover almost the same amount of Americans as Obamacare. 
  • Improves Medical Care Productivity:  The Patient CARE Act will increase medical productivity by 2 to 3 percent compared to ObamaCare. In other words, it will reduce overall costs, while improving quality.
  • Reduces the National Debt:  The Patient CARE Act will reduce the national debt by decreasing federal spending by almost $1.5 trillion.  

Lastly, the Senators stressed that they look forward to receiving input from their colleagues and outside experts to further strengthen and improve their proposal.  “Moving forward, we look forward to working with our colleagues and all interested parties to further build upon this proposal as we seek to replace Obamacare with a patient-centered, market-driven system that is affordable, sustainable, and fair,” the Senators concluded.

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Dr. Coburn sent a letter to Steven Bunnell, general counsel for Department of Homeland Security, asking for the agency to provide unredacted versions of previously requested documents. 

Amendment #2692 – To shorten the timeframe from the affordability framework and rate adjustment delays.  Additional information here.

Amendment #2693 - To target pre-disaster mitigation funds for communities with large premium spikes.  Additional information here.

Amendment #2694 - To prohibit the 4-year rate adjustment delay to business properties and vacation homes.  Additional information here.

Amendment #2695 - To remove all remaining explicit subsidies following affordability framework.  Additional information here.

Amendment #2696 - To eliminate yacht subsidies.  Additional information here.

Amendment #2697 – To allow states to opt-out of participation of NARAB.  Additional information here.

Jan 27 2014

BURR, COBURN, HATCH UNVEIL OBAMACARE REPLACEMENT PLAN

Senate Republican Proposal Lowers Health Care Costs, Increases Access to Affordable, Quality Care Without Government-Centered Regulations, Mandates

WASHINGTON – Today, U.S. Senators Richard Burr (R-N.C.), Tom Coburn, M.D. (R-Okla.), and Orrin Hatch (R-Utah) unveiled the Patient Choice, Affordability, Responsibility, and Empowerment (CARE) Act - a legislative plan that repeals Obamacare and then replaces it with common-sense, patient-centered reforms that reduce health care costs and increase access to affordable, high-quality care.  In contrast with Obamacare and its government centered mandates and regulations, the Senators’ proposal empowers the American people to make the best health care choices for themselves and their families.

Following today’s release of the plan, the three Senators will work with their Senate colleagues and experts across the health care community to further refine and improve upon the proposal, with the goal of building consensus and introducing legislation.

 “The American people have found out what is in Obamacare— broken promises in the form of increased health care costs, costly mandates, and government bureaucracy.  They don’t like it and don’t want to keep it,” said Burr.  “Our nation’s health care system was unsustainable before Obamacare, and the President’s health care plan made things worse.  That’s why the Patient CARE proposal repeals Obamacare and focuses on targeted reforms that will lower costs and expand access to quality care. We can lower costs and expand access to quality coverage and care by empowering individuals and their families to make their own health care decisions, rather than empowering the government to make those decisions for them.”

“For millions of Americans, Obamacare itself has become a preexisting condition that has caused them to lose their insurance, their doctors and their choices. Congress has a responsibility to not only repeal this misguided law but replace it with a plan that will provide better care at a lower cost, and will help preserve programs like Medicaid instead of driving them closer to bankruptcy,” said Dr. Coburn. “It is unfortunate the Senate Majority Leader blocked a vote on an alternative in 2009.  But it’s critical we chart another path forward.  Our health care system wasn’t working well before Obamacare and it is worse after Obamacare.  Americans deserve a real alternative, and a way out.   I’m pleased to take this important step with my colleagues.”   

“Forcing too many Americans out of the insurance they have, away from the doctor they trust and, for some, out of the job they need, Obamacare is a disaster.  With our plan, we’ve shown once again that by empowering Americans – not Washington – with the right tools and information, they will make the best informed health care decisions for themselves,” said Hatch. “After first repealing the President’s health law, we take aim at the chief concerns of the American people - greater economic security by driving down costs and expanding access to high-quality care through increased insurance market competition and reforms.  What we’ve put forward is sustainable and achievable – and without the tax hikes, mandates, and budget-busting spending that have made Obamacare so unpopular with the American people.” 

The Patient CARE Act provides a legislative roadmap to fully repeal the President’s health care law, known as Obamacare, and replace the law with common-sense measures that would:

  • Establish sustainable, patient-centered reforms:
    • Adopt common-sense consumer protections;
    • Create a new protection to help Americans with pre-existing conditions;
    • Empower small business and individuals with purchasing power;
    • Empower states with more tools to help provide coverage while reducing costs; and
    • Expand and strengthen consumer directed health care.
  • Modernize Medicaid to provide better coverage and care to patients:
    • Transition to capped allotment to provide states with predictable funding and flexibility; and
    • Reauthorize Health Opportunity Accounts to empower Medicaid patients.
  • Reduce unnecessary defensive medicine practices and rein in frivolous lawsuits.
    • Medical Malpractice reforms.
  • Increase health care price transparency to empower consumers and patients.
    • Requiring basic health care transparency to inform and empower patients.
  • Reduce distortions in the tax code that drive up health care costs:
    • Capping the exclusion of an employee’s employer-provided health coverage.

A detailed summary of the proposal can be found here

A side-by-side comparison to Obamacare can be found here.

Frequently asked questions on the proposal can be found here.

Illustrative examples of how patients –who are harmed by Obamacare— are helped under the proposal can be found here.

 

###

Dr. Coburn sent a letter to Acting Commissioner Winkowski regarding Mexican military personnel crossing over the International Border into Sasabe, Arizona. In the letter, Dr. Coburn expressed his concerns regarding the incident and requested a response to better understand the nature and frequency of these types of events.  

The incident report can be found here.

Dr. Coburn and five other Senators wrote a letter to HHS Secretary Kathleen Sebelius. The letter, dated Tuesday, Jan. 21, 2014, follows-up prior correspondence the Senators had with the Secretary on the same issue: the Department’s ongoing and misleading suggestion that certain Medicare benefits are “free” due to Obamacare.  

(WASHINGTON, D.C.) – U.S. Senator Tom Coburn (R-OK) released the following statement announcing his decision to give up his Senate seat at the end of this Congress:  

“Serving as Oklahoma’s senator has been, and continues to be, one of the great privileges and blessings of my life.  But, after much prayer and consideration, I have decided that I will leave my Senate seat at the end of this Congress.  

“Carolyn and I have been touched by the encouragement we’ve received from people across the state regarding my latest battle against cancer.  But this decision isn’t about my health, my prognosis or even my hopes and desires.  My commitment to the people of Oklahoma has always been that I would serve no more than two terms.  Our founders saw public service and politics as a calling rather than a career.  That’s how I saw it when I first ran for office in 1994, and that’s how I still see it today.  I believe it’s important to live under the laws I helped write, and even those I fought hard to block.  

“As a citizen legislator, I am first and foremost a citizen who cares deeply about the kind of country we leave our children and grandchildren.  As I have traveled across Oklahoma and our nation these past nine years, I have yet to meet a parent or grandparent who wouldn’t do anything within their power to secure the future for the next generation.  That’s why I initially ran for office in 1994 and re-entered politics in 2004.  I’m encouraged there are thousands of Americans with real-world experience and good judgment who feel just like I do.  As dysfunctional as Washington is these days, change is still possible when ‘We the People’ get engaged, run for office themselves or make their voices heard.  After all, how else could a country doctor from Muskogee with no political experience make it to Washington?

“As a citizen, I am now convinced that I can best serve my own children and grandchildren by shifting my focus elsewhere.  In the meantime, I look forward to finishing this year strong.  I intend to continue our fight for Oklahoma, and will do everything in my power to force the Senate to re-embrace its heritage of debate, deliberation and consensus as we face our many challenges ahead.  

“May God bless you, our state and our country.”

 

###

 

Dr. Coburn highlights expenditures in the Omnibus Appropriations bill.  Additional information can be found here

The Congressional Research Service (CRS) issued a report regarding changes in mandatory programs (CHIMPs) in annual appropriations acts. The memo analyzes the use of CHIMPs involving the U.S. Department of Justice’s Crime Victims Fund (CVF).  The memo also presents summary data on the use of CHIMPs since 2003.

Read the full report here.

(WASHINGTON, D.C.) – Today, Senate Homeland Security and Governmental Affairs Committee Chairman Tom Carper, (D-Del), Ranking Member Tom Coburn, M.D. (R-OK), and House Chairman of the Committee on Energy and Commerce Fred Upton (R-Mich) highlighted a new Government Accountability Office (GAO) report entitled, “IT Dashboard: Agencies Are Managing Investment Risk, but Related Ratings Need to Be More Accurate and Available,” which found that while agencies have made progress at addressing problems with “high risk” IT investments,  reporting guidance discrepancies and lack of timely updates remain problems for the Office of Management and Budget (OMB), which manages the Dashboard.  The report also found that agency risk ratings are not always consistent with their supporting data.  For fiscal year 2014, 27 federal agencies have submitted plans to spend about $82 billion on IT investments.  Of that, $38.7 billion will be spent on “major” IT investments, $37.6 billion on “non-major” IT investments, and $5.5 billion on classified DOD IT investments.

 "When it comes to analyzing the billions of taxpayer dollars the federal government is spending on information technology, the 'IT Dashboard' is a window where there once was a wall," said Chairman Carper. "This tool holds great potential and can help both Congress and the public better understand how scarce taxpayer dollars are spent on information technology projects. However, in order to realize its full potential, agencies must continue to take steps to improve their own organization of IT investments and how they report those investments to the Dashboard. As this report shows, agencies’ efforts are getting better, but are still not perfect. That's why I urge the Administration and agencies’ Chief Information Officers to quickly make good on their promise to improve the 'IT Dashboard' and implement the recommendations suggested by the Government Accountability Office in their report.”

 “The federal government spends billions of taxpayer funds on IT projects every year, and taxpayers have a right to know how effectively those dollars are spent,” Ranking Member Coburn said. “The IT Dashboard is an important tool that enhances transparency on IT projects, and GAO has outlined a number of steps OMB should immediately take to improve the Dashboard.  Notably, GAO pointed out that vague language in OMB’s reporting guidance allows agencies to reclassify IT investments as non-IT investments. As a result, for example, the Department of Energy decided, and OMB agreed, that supercomputers no longer count as IT projects, and has removed them from reporting on the IT Dashboard. This, combined with GAO’s findings that OMB failed to update the public Dashboard for 15 of the past 24 months, means taxpayers are left in the dark on the progress of multimillion dollar projects.  GAO also found that less than half of the IT investments ratings they reviewed were fully consistent with investment risk.  These findings illustrate how OMB is risking accurate transparency with their current IT Dashboard practices, and I will continue to work with OMB and the Committee on enhancing real transparency that gives taxpayers the tools they need to hold the government accountable.” 

"Constant scrutiny of federal spending is critical to reducing taxpayer waste. GAO has helpfully showed the value of the IT Dashboard and identified improvements in its series of reviews of this important tool,” Chairman Upton said.  “Unfortunately, this report shows that past advice has not been heeded, and has identified 'a troubling trend toward decreased transparency and accountability.' This report should be a wake-up call to OMB to make every effort to reverse this trend. Our oversight will continue as we monitor the operations of the agencies we oversee, such as the Department of Energy, whose questionable activity related to the Dashboard is highlighted in this report."

The IT Dashboard is a public website launched by OMB in June 2009 to improve transparency and oversight of “major” federal IT investments.  The Dashboard “displays federal agencies’ cost, schedule, and performance data for over 700 major IT investments at 27 federal agencies, accounting for $38.7 billion of those agencies’ planned $82 billion budget for fiscal year 2014.”

 The Dashboard uses a color-coded rating system to display agencies’ performance for three OMB-defined criteria: cost, schedule, and CIO evaluation.  Cost and schedule ratings are based on a mostly objective reading of data agencies submit to OMB.  For instance, a project that is 30 percent over budget or 30 percent past schedule is automatically rated “red” (high or moderately high risk).  

###

On January 9, 2014, Dr. Coburn joined 15 other Senators in sending a bipartisan letter to the Federation of State Medical Boards (FSMB) supporting FSMB’s efforts to advance multistate practice through more efficient sharing of medical licensure information.  Streamlining the licensing process would allow qualified health care providers to utilize telehealth technology and practice in multiple states. A voluntary licensure compact by FSMB would expand access to high quality care, while preserving the states’ primacy in regulating health providers and protecting patients.  The full letter can be found here.

WASHINGTON, D.C.—U.S. Senators John Thune (R-S.D.), Lamar Alexander (R-Tenn.), Richard Burr (R-N.C.), Tom Coburn (R-Okla.), Mike Enzi (R-Wyo.) and Pat Roberts (R-Kan.) today expressed concern over a Department of Health and Human Services (HHS) Inspector General (IG) report finding insufficient oversight by the Centers for Medicare & Medicaid Services (CMS) of the $32.7 billion electronic health record (EHR) meaningful use incentive program. The IG found that few, if any, protections have been put in place at CMS or with government contractors to detect or prevent fraud from occurring in the EHR program, and suggested that CMS is still using the outdated practices that were used to review and audit paper health records.

“Today’s HHS Inspector General’s report confirms the concerns we expressed last spring about the need for adequate oversight of the electronic health record program to prevent waste and fraud,” said Thune, Chairman of the Senate Republican Conference. “I support the use of electronic health record systems as a way to improve health care, but CMS must ensure that the system is not manipulated in a way that allows for overbilling. As the administration continues to implement the next stages of the meaningful use program, CMS must do more to ensure that the technology it approves better protects taxpayer dollars.”

“Encouraging the use of electronic health care records by doctors, hospitals and other health care providers is about improving care for patients,” said Alexander, the senior Republican on the Senate Health Committee. “The Centers for Medicare and Medicaid Services should be doing everything it can to prevent and stop the fraud and abuse that undermine this crucial innovation in the health care industry and put Medicare at risk of overpaying for care.”

“Today’s HHS IG’s report highlighting insufficient practices to protect electronic health records is deeply concerning,” said Burr, the senior Republican on the Senate Veterans’ Affairs Committee. “It is particularly troubling that the issues raised today are not new, but echo those highlighted by my colleagues and I last year. Today’s report is another example of the Administration falling short when it comes to implementation of IT initiatives and only increases my concerns regarding the security of consumer’s information under the Affordable Care Act. When it comes to protecting patient’s information, the Administration’s actions continue to speak louder than their promises. Billions of taxpayer dollars are being spent to advance health information technology under the HITECH Act and the Administration should ensure that the American people’s investment is sound and their information secure.”

“The Inspector General's office has offered an important warning that CMS is failing to adequately oversee the program integrity of its electronic health records program,” said Dr. Coburn, the senior Republican on the Senate Homeland Security and Governmental Affairs Committee. “Taxpayers fund the federal incentive payments that help to drive providers' adoption of EHRs, which contain sensitive personal information. CMS has a fundamental responsibility to do a better job of policing and enforcing basic security requirements. I look forward to working with my colleagues who penned the REBOOT report in continuing oversight as needed to ensure CMS takes the necessary precautions to protect taxpayers and patients.”

“Reducing the opportunities for fraud and removing the incentives for overbilling are vital to improving confidence in electronic health record programs,” said Enzi, a senior member of the Senate Health Committee. “The serious issues identified by the Inspector General need to be addressed to protect patient information, improve data security, and reduce waste. I join my colleagues in calling for changes to this program that will put privacy and safety of one's personal information first.”

“It’s unfortunate that another report is being released citing pitfalls in the implementation of electronic health records,” said Roberts, the senior Republican on the Senate Rules Committee. “Even more unfortunate is the fact that my colleagues and I have been pointing out these problematic concerns to the Administration for over a year and as this report details little to no response has occurred. Electronic health records are important for the future of our health system, however their implementation must be done in a thorough and conscientious way that ensures all providers are included and leads to the reduction of waste or fraud and not its increase. I will continue to push for an interoperable health IT system but it must protect patient privacy and it must include safeguards against waste, fraud, and abuse.”

In April of 2013, the group of Republican senators released a white paper, “REBOOT: Re-examining the Strategies Needed to Successfully Adopt Health IT,” outlining concerns with current federal health information technology policy, including increased health care costs, lack of momentum toward interoperability, potential waste and abuse, patient privacy, and long-term sustainability. 

###

(WASHINGTON, D.C.) – Today, United States Senators Tom Coburn, M.D. (R-OK) and Elizabeth Warren (D-MA) introduced bipartisan legislation to increase transparency around settlements reached by federal enforcement agencies. When federal agencies close investigations and settle cases, they often tout the dollar amount obtained from the offender, but in some cases that amount could be misleading because of tax deductions and other "credits" built into the settlement that reduce the settlement's true value. In some cases these settlements are unnecessarily deemed confidential and remain undisclosed to taxpayers. The Truth in Settlements Act will require more accessible and detailed disclosures about these agreements to allow the public to hold regulators accountable for the true value of these agreements.

"Taxpayers deserve to know the settlement details corporations arrange with the government, and the best place for Congress to start is with policies that enhance transparency," Dr. Coburn said. "Since agencies are not currently required to disclose the financial structure of government settlements, too often the true value of those settlements is not known because often companies are allowed to deduct part of the payment. Our bill gives taxpayers the transparency tools they need to access real information and numbers regarding enforcement settlements."

"When government agencies reach settlements with companies that break the law, they should disclose the terms of those deals to the public," said Senator Warren. "Anytime an agency decides that an enforcement action is needed, but it is not willing to go to court, that agency should be willing to disclose the key terms and conditions of the agreement. Increased transparency will shut down backroom deal-making and ensure that Congress, citizens and watchdog groups can hold regulatory agencies accountable for strong and effective enforcement that benefits the public interest."

Under the Truth in Settlements Act, all written public statements that reference the dollar amounts of settlements over one million dollars will be required to include explanations of how those settlements are categorized for tax purposes and whether payments may be offset by "credits" for particular conduct. Companies that settle with enforcement agencies will be required to disclose in their Securities and Exchange Commission (SEC) filings whether they have deducted any or all of the dollar amounts of their settlements from their taxes; and federal agencies will be required to post basic information about settlements and provide copies of those agreements on their websites.

To address concerns about confidentiality, the Truth in Settlements Act also requires agencies to explain publicly why confidentiality is justified in any particular instance. The Act also directs agencies to disclose basic information about the number of settlements they deem confidential each year and directs the Government Accountability Office (GAO) to conduct a study of confidentiality procedures and to provide additional recommendations for increasing transparency. These and other provisions of the Truth in Settlements Act will increase the transparency of government settlements and permit greater public scrutiny.

Additional information available here.

###

WASHINGTON- Today, Senate Homeland Security and Governmental Affairs Committee Chairman Tom Carper (D-Del.) and Ranking Member Tom Coburn (R-Okla.) commended the Centers for Medicare and Medicaid Services (CMS) for moving forward on key proposals to curb the fraudulent diversion of prescription drugs from the Medicare program. The announcement follows a hearing the Committee held in June that highlighted the need for stronger oversight of the Medicare prescription drugs program.  

“I welcome the steps that the Centers for Medicare and Medicaid Services (CMS) is taking to curb the fraudulent diversion of drugs from Medicare,” said Chairman Carper. “For years, Medicare has lost millions of dollars due to fraudulent prescriptions for painkillers and other drugs. This fraudulent activity is not only a financial drain on a vital federal program, but it is also harmful to those struggling with prescription drug abuse. These commonsense reforms will help provide CMS with the tools and authority needed to actively combat this type of waste and fraud while protecting Medicare beneficiaries and strengthening the Medicare program.”

“I applaud Medicare officials for adopting policies that will enable program integrity experts to review and act on abusive and harmful prescribing of powerful drugs and controlled substances,” said Dr. Coburn. “The vast majority of physicians are professionals who want to help patients. Yet, where there is proof of abuse or fraud, CMS should take necessary actions to protect patients and taxpayers. Moving forward, it will be important for Medicare officials to implement this policy in a manner that is data-driven, thoughtful, and helps educate the provider community.”

The new proposal allows CMS to more quickly identify suspect Medicare prescriptions and actively prevent providers from charging the Medicare program for unnecessary medications. For example, CMS will be able to remove providers whose licenses to prescribe prescription painkillers or other controlled substance have been revoked by state regulators.  In addition to providing enhanced enforcement capabilities, these reforms will fix a loophole in the Medicare Part D program that allows providers to prescribe medications, even if they are not approved Medicare providers.

During the June 2013 hearing, testimony by CMS, the Health and Human Services Office of Inspector General and others showed that CMS’s oversight of the Part D program lacked effective controls to prevent waste and fraud. Witnesses testified that CMS should use its existing authority to enhance its oversight procedures to protect the Medicare Prescription Drug Program and save taxpayer dollars, and work with Congress on other steps that may require new legislative authority. Many of the reforms suggested by the witnesses are reflected in CMS’s new proposal.

The proposal by CMS is open for comments, and is scheduled for final adoption in January of 2015.

###

Jan 07 2014

Federal Agencies Continue Improper Payments to Deceased People

GAO Report Calls for Increased Attention to the Death Master File

WASHINGTON – Today, Senate Homeland Security and Governmental Affairs Committee Chairman Tom Carper (D-Del.), Ranking Member Tom Coburn (R-Okla.), Senate Financial and Contracting Oversight Subcommittee Chairman Claire McCaskill (D-Mo.), Ranking Member Ron Johnson (R-Wis.) and Senate Special Committee on Aging Ranking Member Susan Collins (R-Maine) highlighted a recent report from the Government Accountability Office (GAO) that outlines troublesome yet preventable errors in the Social Security Administration’s (SSA) database of deceased individuals, known as the Death Master File (DMF). House Ways and Means Committee Chairman Sam Johnson (R-Texas) was also a co-requestor on the report.

The GAO report, titled Social Security Death Data: Additional Action Needed to Address Data Errors and Federal Agency Access, found that federal agencies are at significant risk of making improper payments because they do not have adequate access to the complete DMF. Additionally, the report found that the DMF is at times inaccurate due to inadequate verification by the Social Security Administration.   For example, the GAO easily found instances where people’s deaths were recorded as before their births.

“This Government Accountability Office report highlights a fundamental set of problems with how government agencies keep track of deceased individuals,”said Chairman Carper. “The type of errors identified in the report cost taxpayers millions of dollars in improper payments each year.  The good news is that these problems easily can be fixed. Legislation Dr. Coburn and I introduced earlier this year with a bipartisan group of senators would help preventing payments made in error to deceased individuals.  I hope the Social Security Administration will take the findings in this report to heart and work to prevent improper payments to dead people in the future.”

“This GAO report outlines what the SSA and Congress already know: there are a number of in-house actions SSA can take to improve the Death Master File and curb wrongful payments,” said Ranking Member Coburn. “For example, in May of 2013, the SSA Office of Inspector General pointed out that over 180,000 deceased persons had not been listed in the Death Master File, even though those same persons had already been reported as deceased to the SAA Supplemental Security Records. This GAO report builds on the work by the SSA OIG and our committee, and further identifies weaknesses including the failure by SAA to independently verify death records, as well as issues with intra-agency access.  Both SSA and Congress have an obligation to safeguard American taxpayer funds since every misspent dollar is a dollar that doesn’t reach those truly in need.  Congress and the SSA can no longer remain ignorant to the fact that the Death Master File has significant problems that must be mended.  Absent competent leadership at SAA, Congressional action is needed, which is why Chairman Carper and I introduced bipartisan legislation this past summer that would address many of the problems identified by this GAO report and other past reports on the file.  It is my hope SAA and Congress institute these necessary reforms to ensure the integrity of the Death Master File.”

“We should be falling all over ourselves to make sure this list is accurate and complete and that the entire federal government has access to it,” said Senator McCaskill. “If these separate agencies were part of the same private business, there’s simply no way things would function like this. This is about the bottom line for taxpayers.”

“The Government Accountability Office has identified problems with how the Social Security Administration complies and distributes data on deceased individuals,” said Senator Ron Johnson. “It is clear that without access to complete and accurate data, federal agencies are at a risk of making millions of dollars in improper payments. I hope that the Social Security Administration will evaluate and implement the recommendations in this report and strengthen its efforts to prevent the abuse of taxpayer dollars.”

“I am deeply troubled by the discrepancies that GAO found in the Social Security Administration’s death records,” said Senator Collins.  “Unfortunately, these inaccuracies can result in the waste of taxpayer dollars through improper payments to people who are no longer alive.  I urge the Social Security Administration to take the steps recommended by the GAO to help ensure the accuracy of its records."

In July, Chairman Carper and Ranking Member Coburn introduced the Improper Payments Agency Cooperation Enhancements Act (IPACE or S. 1360), bipartisan legislation the builds upon improper payment laws enacted in2010 and 2012, that were championed by Chairman Carper. The legislation would curb improper payments by: Allowing federal agencies access to the complete DMF databases, not just the partial list currently available to most agencies; requiring that federal agencies make appropriate use of the DMF to regularly review beneficiary and other lists to identify dead individuals; establishing procedures to better facilitate the sharing of data about instances of death among federal agencies, including with SSA; and ensuring that federal agencies that manage retirement programs share best practices to ensure that payments to dead retirees are ended.

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Amendment #2606 - To end unemployment payments to jobless millionaires and billionaires. Additional information here

Amendment #2607 - To ensure that individuals do not simultaneously receive unemployment compensation and disability insurance benefits.  Additional information here

 

 

(WASHINGTON, D.C.) – Today, Homeland Security and Governmental Affairs Committee Ranking Member Tom Coburn, M.D. (R-OK) highlighted a new report from the Governmental Accountability Office (GAO) entitled, Border Security: DHS’s Efforts to Modernize Key Enforcement Systems Could be Strengthened”, that found significant problems with the management of upgrades to TECS, a key border enforcement information technology system used by the Department of Homeland Security’s (DHS) Customs and Border Protection (CBP) and Immigration and Customs Enforcement (ICE), as well as other federal, state, and local agencies.  According to GAO, “After spending millions of dollars and over four years on TECS modernization, it is unclear when it will be delivered and at what cost.” DHS’s failure to manage this program has led to millions of dollars in wasted taxpayer funds, and leaves the department at risk for having to pay increasing costs of up to $40-$60 million per year to maintain the existing system if the modernization effort isn’t completed on time, while those on the front lines continue to lack much-needed improvements to better defend and secure our borders.  

“Today’s GAO report provides another illustration of how DHS spends more taxpayer dollars and gets less for the American people,” Dr. Coburn said.  “The failure of DHS to effectively manage modernization of the TECS system in a timely and fiscally responsible manner calls into question the Department’s ability to deliver needed capabilities to the front lines on time and on budget.  The Department’s decision to pursue two separate programs to upgrade components of the same IT system has led to unneeded duplication and overhead costs and uneven performance. While CBP has succeeded in deploying some new functionality, the GAO report details how, after spending $19 million on its separate program, ICE now plans to scrap its effort and start over.  GAO found evidence that DHS, as well as both CBP and ICE have begun to implement important best practices to oversee major programs. While I commend DHS for those actions, this report shows that the Department has significant work to do in order to translate them into results.  Because both programs face cost, schedule and performance risks, it is imperative that DHS take necessary steps to define key requirements, identify and manage risks, and ensure that program data are accurate to reduce delays and manage costs.  I will continue to work with DHS and the committee on conducting oversight of the TECS program to ensure it is managed properly so that taxpayer dollars are spent wisely to enhance border security.” 

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WASHINGTON - Today, Senate Homeland Security and Governmental Affairs Committee Chairman Tom Carper (D-Del.), Ranking Member Tom Coburn (R-Okla.), Senate Financial and Contracting Oversight Subcommittee Chairman Claire McCaskill (D-Mo.) and Senator Susan Collins (R-Maine) highlighted a new Government Accountability Office (GAO) report that details some of the problems and lessons learned from the General Service Administration’s transition process for Networx telecommunications contracts for over 150 agencies from the legacy FTS2001 contracts. 

“The rocky transition to the Networx contracts was, unfortunately, a lesson in lost opportunities,” said Chairman Carper. “As this report shows, dozens of agencies missed out on hundreds of millions of dollars in savings under the new contracts, and instead accrued tens of millions in increased costs in contract management. Given that we are trying to do more with fewer resources in every part of the government, it is essential that programs like Networx reach their full potential and garner all possible savings. One of my core values is if it isn’t perfect, make it better, and I believe that the General Services Administration must look at these lessons learned and perfect its process so the transition to the next suite of telecommunications contracts does not veer off -course as the Networx transition did.”

“GSA’s failure to successfully transition its telecommunications services to Networx is the latest in a long line of contracting problems.  Too often we’ve seen poor planning, unnecessary duplication, and inadequate management at GSA,” Dr. Coburn said.  “Even worse, as the report shows, it cost taxpayers $329 million more than if GSA had adequately transitioned to Networx on schedule.  Such mismanagement and waste is simply unacceptable, especially at a time of increasing debts and limited resources.  GAO has made a number of recommendations to GSA, including that GSA establish better transition plans with detailed time frames to get this program back on track. GSA should implement these recommendations and take immediate steps to prevent future delays and wasteful and unnecessary spending. I look forward to working with the committee to conduct oversight of this, and other efforts by GSA to improve efficiency, and save taxpayer dollars.”

The transition from FTS2001 to Networx took almost three years longer than planned, and GSA estimates that the delay increased the transition cost by over $66 million.   Further, GAO estimates that if the transition had occurred on time agencies could have saved over $328.7 million by moving to lower-cost services on the Networx contracts.  GAO found that the delays by agencies in transitioning to Networx were attributable to a number of factors, including weak project planning and a complex acquisition process characterized by duplicative contracts and a large number of service options.  Additionally, GSA reported that these issues were compounded by a decline in contracting and technical expertise in the agencies.

The General Services Administration (GSA) negotiated the Networx contracts in 2007 to provide a range of telecommunications services to federal agencies, including internet and wireless services.  These contracts will expire in 2017 and GSA is in the planning stage for the next generation of contracts to replace Networx, which will be known as NS2020.  However, GAO reports that there is a high risk that GSA will not meet its goal of awarding the next set of contracts in 2017, and that GSA expects to extend the Networx contracts for at least three years. 

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December 2013

Dr. Coburn released the following letter on his hold regarding  S. 944, the Veterans Health and Benefits Improvement Act of 2013.

December 20, 2012

The Honorable Mitch McConnell

Senate Minority Leader

United States Senate

Washington, DC  20510

 

Dear Senator McConnell,

I am requesting to be consulted before the Senate enters into any unanimous consent agreements or time limitations regarding S. 944, the Veterans Health and Benefits Improvement Act of 2013.

This legislation promises to expand many veterans’ health care and education services and benefits that are supposed to be provided by the VA.   I believe our veterans deserve the finest health care and educational support a grateful national has to offer.  However, S. 944 falls far short of this worthy goal. 

Before we promise new benefits, we need to make sure the promises we made are being kept—especially as over 392,000 veterans are stuck in the VA’s disability claims backlog,[1] and as a result are suffering delays in receiving treatment.  We are unable to fulfill our current promises to the brave men and women who fought for the freedoms each of us have today.  It is shameful for Congress to claim credit for providing new benefits while old promises are forgotten and as a result literally resulting in the deaths of our heroes. 

S. 944 is an overreach of federal power, would add millions of dollars to the deficit, and fails to address the real problems facing the Department of Veterans Affairs or the veterans they serve.  As evidenced by just a few examples, the state of the care for veterans in this country is not optimal and even endangering their lives. 

Just a few weeks ago, the VA hospital in Augusta, Georgia, apologized for the death of three veterans at their facility, which occurred because of delays in medical care.  CNN explained their “investigation revealed that military veterans are dying needlessly because of long waits and delayed care at U.S. veterans hospitals.”[2]  CNN’s work also found that “numerous VA hospitals actively engage in cover-ups of their extensive patient wait times, including the falsifying of records. Additionally, the administrators of these hospitals are regularly rewarded with bonuses, rather than facing consequences for patient neglect.”[3]  Congress has known for over two years of the chronic delays in veteran’s health care service, and even appropriated funds to address it.  Yet, CNN found only one third of the $1 million appropriated to address the issue were actually used for this purpose.  And now, this bill would add even more responsibilities to the VA facilities, which are already facing delays and failing to provide acceptable medical care.  In other VA health related delays, the Department faces ongoing delays in processing disability claims from veterans in need of assistance.[4]   Simultaneously, the VA postponed the purchase of more than $765 million in medical equipment, which according to a Bloomberg FOIA request of VA documents, affected the care of veterans at various facilities.[5] 

            These tragic examples may sound fabricated, but are not. They are real examples of how the lives and well-being of thousands of veterans currently suffering. Not at the hands of a military enemy, but because of the incompetence of their own government, which is unable to meet their needs and in some cases, causing harm and even death.   This bill will only compound the problem, while promising services and care we are unable provide.

The bill also reaches far beyond the appropriate scope of the federal government. Specifically, S. 944 would allow VA funding for the Montgomery GI Bill and Post-9/11 GI Bill program to be directed only to any institution of higher education that charges in-state tuition to veteran who enroll within three years of separation from service on active duty, regardless of their home state of residence.  According to the Congressional Budget Office (CBO), “Institutions that choose not to comply with those conditions would no longer be approved to participate in Montgomery GI Bill or Post-9/11 Bill programs.” 

            While admirable for individual states to consider providing in-state tuition for student veterans, it is inappropriate for the federal government to require educational institutions to do so by threatening to withhold funds.  Further, there is little need for federal action, as the states are ahead of the federal government in providing this benefit to many of our veterans.  Determining criteria for in-state eligibility and tuition for student veterans is already being considered by the states.  In fact, many states have enacted or are currently considering legislation to provide veterans with in-state tuition waivers in support of furthering veterans’ education.  According to Student Veterans of America, 20 states have laws affording veterans the ability to obtain an in-state residency waiver, while 10 states have legislation pending regarding in-state residency waivers for veteran students.  Additionally, eight states which have certain schools or particular school systems which afford veterans in-state residency waivers.  States have taken up this issue without the federal government, as veterans across the country continue to advocate at the state level their desire for this benefit.

I believe decisions regarding education policy and funding, should be controlled by the state and local governments which have the closest contact with students—rather than bureaucrats and politicians in Washington.  I will continue to ensure our nation maintains the promises we have made to our veterans, but I will not support violations of states rights, which are clearly outlined in the very Constitution our veterans fought to protect.

There are a number of budgetary concerns with S. 944.  The Congressional Budget Office (CBO) estimates the mandatory spending provisions in the legislation will result in net deficit reduction of $94 million over ten years.  However, the bill also increases discretionary spending by $171 million over five years, but CBO does not provide a ten year estimate.  At best, the legislation adds at least $77 million to the deficit, however it is likely much more.  Further, the assumed mandatory deficit reduction relies heavily on a provision that will not bring in additional revenue until 2018.  Yet, the significant spending increases in the bill take effect immediately. It is an affront to taxpayers to pretend to offset the cost of a bill with a promise of future revenue to pay for current spending that will be set on autopilot. Furthermore, considering the VA has received approximately a 58% increase[6] in budget since Fiscal Year 2009, our country cannot afford to continue to spend taxpayer dollars at VA without real assurances to veterans that additional funding will improve already failing VA services.

At a time of runaway deficits and a crippling national debt, it is inappropriate to add even one dime to our national debt, and this legislation should be fully offset with tangible and real spending reductions and reforms.  No corner of the federal budget is exempt from budgetary scrutiny or immune to waste, duplication, and mismanagement, and the Department of Veterans Affairs is no exception.  There are numerous areas for savings within the VA budget.  For example, the President’s FY 2014 budget proposes several VA changes, including eliminating a duplicative Veterans Workforce Investment Program at the Department of Labor, which would save $15 million in one year and adjusting TRICARE Fees to better reflect costs.

Former Joint Chiefs Chairmen Admiral Mike Mullen has declared several times, “the single biggest threat to our national security” is the national debt.   We must honor the sacrifice of the millions of military veterans by keeping our promise to reduce the national debt in hopes of a more secure and safe future.  By refusing to pay for this bill, the Senate is undermining our military, our country, and our future.  Even more, by ignoring the outrageous delays in medical care and the tragic deaths of veterans at the hands of these VA facilities, this to both veterans and taxpayers, both who deserve far better from their government.  We must first address the real needs of veterans and ensure they receive the benefits we have already been promised, and we should do so by being good stewards of taxpayer dollars.

Thank you for protecting my rights on this legislation.

                                                            Sincerely,

 

Tom A. Coburn

United States Senator

Yesterday the Office of Inspector General (OIG) at the U.S. Department of Health and Human Services (OIG) said that overseeing health insurance exchanges under the Patient Protection and Affordable Care Act (“Obamacare”) is the biggest challenge that HHS faces in 2014.  The OIG made the announcement in their updated annual report of the ten “top management & performance challenges” the Department faces in the year ahead. 

Each year the OIG outlines the key “continuing vulnerabilities” HHS faces in efforts to reduce waste, fraud, and abuse and ensure program integrity. The OIG said that overseeing health exchanges under Obamacare was the top performance challenge because the creation of the exchanges added “a substantial new dimension to the Department's program landscape.”  Exchanges must meet  a “complex set of program requirements” which have to be successfully implemented for the first time in federal policy—regardless of whether or not the exchange is federally-facilitated or state-run.

The report amplified HHS Secretary Kathleen Sebelius’s recent focus on the contractors who are implementing the health care law. The Secretary made news recently when she announced she asked the OIG to examine the role of contractors in the failed October launch of the health website.

Contractors have played, and will continue to play, a “vital role in building, maintaining, and fixing the systems” that underpin the health care exchanges, the OIG report explained. But the report suggested that it is ultimately the Department—not contractors alone—which is responsible, since contractors are performing tasks prescribed by the Administration.  “The Department must ensure, to the greatest extent possible, that the Government obtains specified products and services from its various contractors on time and within budget” the report said pointedly.

Many observers, including Jeff Zients, who was brought in to assist with coordinating the rollout of the health law, have suggested that one factor in the creation of the website problems was the fact that no single individual was totally in charge of all the individual pieces of a complex implementation.  The OIG report lent credence to this conclusion, saying the management headache was increased by “the large number of contracts and the need to coordinate work across multiple contractors.”  The report listed challenges associated with successful contract administration elsewhere it its top ten list.

While the functionality of the health website has notably improved compared to the initially rocky rollout of HealthCare.gov—a rollout that damaged voters’ perception of the President’s credibility and trustworthiness on his signature domestic initiative—the OIG report provided little solace for federal health officials who think the worst may be over.  The OIG said HHS still faces “significant, well-publicized challenges in ensuring that healthcare.gov operates successfully” for consumers. As weeks of media coverage has highlighted, the problems run deep. As the report explains, the challenges  include “both the front-facing consumer functions, as well as the back-end administrative and financial management functions.”

Congressional critics find the report confirms their warnings of further “glitches” with the health law’s rollout.  Republicans have been critical of the Administration’s waffling on how they would verify individual consumers’ eligibility or of HHS’s efforts to share massive amounts of data with other federal agencies—two areas the report stressed the need for continued careful oversight. 

But even supporters of the health law are likely to worry about additional challenges, as the tasks outlined for the Department are rather daunting. On top of making the website work, OIG offered a laundry list of items Secretary Sebelius and her leadership must focus on in weeks and months ahead.  The OIG said HHS must keep its eye on overseeing “eligibility systems, payment accuracy, contractor oversight, and data security and consumer protection.” 

If those tasks were not intimidating enough, the report also warned federal officials who likely already behind schedule that coordination between federal and state programs, private health plans, and an array of federal contractors is “necessary to achieve program objectives and poses an additional challenge.” The Department must still work to “ensure that healthcare.gov verifies consumers' personal information; accurately determines eligibility for Marketplace insurance, tax credits, and cost-sharing subsidies; operates effectively and easily for consumers; and transmits complete, accurate, and timely information to insurers regarding enrollees,” the report said. 

Fixing the data sharing may be a tall order, since even very recently there have been problems with the website successfully transmitting 834 forms to insurers and Medicaid enrollment data to states.  This is why “vigilant monitoring and testing of the Marketplaces and rapid mitigation of identified vulnerabilities are essential” to preventing further problems, the report explained.

Some early reports of consumer enrollment suggest that fewer young consumers may have enrolled in plans compared to prior projections, though HHS has yet to release any detailed data. Echoing a worry of many health policy experts outside the Administration, the report underscored younger, healthy Americans have to enroll in Obamacare for the policy experiment to succeed.  “Sufficient enrollment, deemed as including enrollment of relatively healthy individuals, is essential for producing a stable and effective insurance market,” the report noted.

One issue the report focused on has received less media attention to date, but will be increasingly important in the weeks ahead: payment accuracy. A dizzying array of new and complex federal payments—advance premium tax credits, cost-sharing subsidies, and premium stabilization payments—must be made to a range of entities. These payments involve “complex calculations and offsets, adjustments, and reconciliations, which pose challenges for making accurate payments,” the report cautioned. The OIG said it was imperative HHS “work closely with insurers to ensure that information is timely, complete, and accurate” and also “develop error rates to measure the integrity of program payments.”

Surprisingly, the report cautioned that HHS still has to complete the “development and implementation of financial management and payment systems and ensure that payments to insurers, which are scheduled to begin in January 2014, are accurate.” If systems are incomplete at this point and are in fact still being “developed” within a few weeks of going live, bumps and errors may be inevitable.  So the OIG report stresses that federal officials will need to be proactive and nimble to react in such an environment in which “the Department will face continuing challenges as the program evolves over time.”

A number of consumers and privacy groups have worried if fraudsters and crooks can scam the new system, since the OIG is on the record as saying the new program is a ripe target for fraud. “As with other new programs,” the report counseled “the Department must monitor for known fraud, waste, and abuse risks and detect emerging new risks” and “respond quickly and effectively.” Because these exchange’s data systems handle consumers' sensitive personal information, “security of data and systems is paramount” the OIG stressed.

To maximize security, consumers also need to be educated about potential fraud schemes, the report suggested. Scams include a range of gimmicks, the OIG outlined, including “identity thieves posing as legitimate assisters offering to help individuals purchase insurance in exchange for money or personal identifying information; imposters misleading Medicare beneficiaries into falsely believing they need to purchase new insurance; and sham websites that appear to be legitimate.”

Moving forward, the report said the OIG will monitor the implementation and functioning of the exchanges and focus oversight on key risk areas, such as eligibility systems, payment accuracy, information technology security, and contracting. The OIG also announced it will audit program safeguards to prevent the submission of fraudulent or inaccurate information.

# # #

Inspector General: Running Obamacare’s Exchanges Is  The “Top Management Challenge” for HHS In 2014 

(WASHINGTON, D.C.) – U.S. Senator Tom Coburn, M.D. (R-OK), ranking member of the Homeland Security and Governmental Affairs Committee, today released his annual oversight report “Wastebook 2013” highlighting 100 examples of wasteful and low-priority spending totaling nearly $30 billion.  

“While politicians in Washington spent much of 2013 complaining about sequestration’s impact on domestic programs and our national defense, we still managed to provide benefits to the Fort Hood shooter, study romance novels, help the State Department buy Facebook fans and even help NASA study Congress,” said Dr. Coburn.

“Had Congress, in particular, been focused on doing its job of setting priorities and cutting the kind of wasteful spending outlined in this report, we could have avoided both a government shutdown and a flawed budget deal that was designed to avert a shutdown.  The nearly $30 billion in questionable and lower-priority spending in Wastebook 2013 is a small fraction of the more than $200 billion we throw away every year through fraud, waste, duplication and mismanagement.   There is more than enough stupidity and incompetence in government to allow us to live well below the budget caps.  What’s lacking is the common sense and courage in Washington to make those choices – and passage of fiscally-responsible spending bills – possible,” said Dr. Coburn.

“This report speaks volumes about why confidence in government is at an all-time low.  The hard truth is we’d much rather borrow than cut.  The American people are right to expect more,” said Dr. Coburn.

Examples of wasteful spending highlighted in “Wastebook 2013” include:

  • Uncle Sam Looking for Romance on the Web – (NEH) $914,000

The Popular Romance Project has received nearly $1 million from the National Endowment of the Humanities (NEH) since 2010 to “explore the fascinating, often contradictory origins and influences of popular romance as told in novels, films, comics, advice books, songs, and internet fan fiction, taking a global perspective—while looking back across time as far as the ancient Greeks.”

  • Mass Destruction of Weapons – (Department of Defense) $7 billion

As the U.S. war effort in the Middle East winds to a close, the military has destroyed more than 170 million pounds worth of useable vehicles and other military equipment. The military has decided that it will simply destroy more than $7 billion worth of equipment rather than sell it or ship it back home.

  • Millions Spent Building, Promoting an Insurance Plan Few Want and a Website that Doesn’t Work – (Department of Health and Human Services) At least $379 million

With nearly half-a-billion dollars in government funding put behind promoting a product that relatively few people seem interested in purchasing off a website that doesn’t work, Obamacare is perhaps the biggest marketing flop since Coca-Cola introduced the world to “New Coke” in 1985.

  • Government Study Finds Out Wives Should Calm Down (NIH) $325,525

If your wife is angry at you and you don’t want her to stay that way, you might avoid passing along the findings of this government study. Wives would find marriage more satisfying if they could calm down faster during arguments with their husbands, according to government-funded research.

  • Fort Hood Shooter Continued to Collect Government Paycheck (Army) ($52,952 in 2013)

While the families of the survivors and victims were fighting to receive military benefits, the Fort Hood shooter Major Nadal Hasan was cashing his paycheck. Since the shooting, Hasan has received over $278,000 in military benefits because the Military Code of Justice doesn’t allow a soldier to be suspended until they are found guilty.

  • NASA Searches for Signs of Intelligent Life … in Congress – (NASA) $3 million

One of NASA’s next research missions won’t be exploring an alien planet or distant galaxy. Instead, the space agency is spending $3 million to go to Washington, D.C. and study one of the greatest mysteries in the universe—how Congress works.

  • Hurricane Sandy “Emergency” Funds Spent on TV Ads ($65 million)

In January 2013, Congress passed a bill to provide $60.4 billion for the areas devastated by Hurricane Sandy.  However, instead of rushing aid to the people who need it most, state-level officials in New York and New Jersey spent the money on tourism-related TV advertisements.

  • Federally Funded Solar Panels Covered at Manchester-Boston Airport Because the Glare Blinds Pilots and Controllers (FAA) - $3.5 million

When officials at the Manchester-Boston Regional Airport in New Hampshire installed new solar panels, they did not anticipate one quarter of them would not be used 18 months later. In Spring 2012, the panels were placed on top of the airport’s parking garage, and 25 percent have remained there, covered with a tarp, rendering them useless. Problems with the new panels were noticed almost immediately by air traffic controllers who claimed that for 45 minutes each day, glare made it difficult to oversee the airport’s runways.

  • Need Brains!  Fighting Zombies with Pluses and Minuses -- (NC) $150,000

A grant from NSF went to a company in North Carolina to develop a math learning game based on the zombie apocalypse.

  • NASA’s Little Green Man (NASA) -- $390,000

Since NASA is no longer conducting space flights, they have plenty of time and money to fund a YouTube TV show and cartoon series called “Green Ninja” in which a man dressed in a Green Ninja costume teaches children about global warming.

Defense-related waste here.

Tax-related waste here

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Dec 16 2013

Donnelly, Coburn Introduce Bill to Preserve Access to Manufactured Housing

Pushes for mortgage rules to protect affordable homeownership

Washington, D.C. — Today, Senators Joe Donnelly (D-IN) and Tom Coburn (R-OK) introduced the Preserving Access to Manufactured Housing Act, legislation that would maintain important consumer protections while also protecting the ability of manufactured home customers to buy, sell, and refinance homes.

Donnelly said, “For many Hoosier families, the decision to purchase a home is one of the most significant investments they will make. We should be doing all we can to preserve access to affordable housing, especially when it comes to manufactured housing, which can be the best option for many families. I thank Senator Coburn for joining me in this effort.”

Dr. Coburn said, “This bill will ease onerous federal regulations for consumers and retailers which slow economic growth in the industry.”

Earlier this year, the Consumer Financial Protection Bureau (CFPB) issued guidelines, as required under the Dodd-Frank Wall Street Reform and Consumer Protection Act, to expand the range of loan products that can be considered high-cost mortgages under the Home Ownership and Equity Protection Act (HOEPA). Unfortunately, the CFPB failed to recognize the uniqueness of manufactured home loans compared to the rest of the housing industry.  Set to go into effect in January 2014, these guidelines will likely classify a large percentage of small-balance loans used for the purchase of affordable manufactured housing as high-cost loans.  As a result, there would be increased lender liabilities associated with making and obtaining a HOEPA high-cost mortgage, which could lead to a loss of credit available to those seeking to purchase manufactured housing.  

The primary purpose of the Preserving Access to Manufactured Housing Act is to adjust new HOEPA thresholds so fewer manufactured home loans are classified as high-cost.  Under the new guidelines, if a transaction is for less than $50,000 and the home is considered personal property, then the interest rate on a mortgage cannot exceed Average Prime Offer Rate (APOR) by more than 8.5% or else it is considered ‘high-cost’ and subject to added liability and disclosure.  The bill would change that threshold to APOR + 10% for transactions under $75,000.

Earlier this year, Senator Donnelly discussed this issue with CFPB Director Richard Cordray and recently joined other Senators in sending a letter to Director Cordray requesting a delay of the new rules for manufactured housing until CFPB has had a chance to fully study the issue.

Read the full legislation here.

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(WASHINGTON, D.C.) – U.S. Senator Tom Coburn, M.D. (R-OK) will unveil Wastebook 2013, his annual report on egregious federal spending, at a press conference on Tuesday, December 17, at 10 a.m. EST in Room S-325 of the Capitol.

WHAT:  Press conference to unveil “Wastebook 2013”

WHEN: Tuesday, December 17, 2013, at 10 a.m. EST                 

WHERE: Room S-325 of the Capitol

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On November 29, 2013, Mary Wakefield, the director of the Health Resources and Services Administration at HHS replied to the letter Dr. Coburn (along with Sen. Burr and Enzi) sent her on November 1, 2013. Their original letter followed up on the findings of GAO’s report (GAO-13-806), which the Senators said showed HRSA had failed to provide Congress and the public with timely and meaningful analysis regarding health care provider shortages across our country. As the Senators noted in their letter, they were “gravely troubled by the findings” of the report, and therefore requested a series of documents from HRSA on the matter.  

HRSA Director Wakefield’s letter included responses (see here and here) to a number of specific items the Senators had requested, as well as references to a new HRSA study issued as a result of the Senators’ oversight work. The new study, “Projecting the Supply and Demand for Primary Care Practitioners Through 2020,” was issued by HRSA’s Bureau of Health Professions National Center for Health Workforce Analysis. 

The new study found that the country will be about 20,400 primary carephysicians short by 2020. HRSA’s study cites “aging and population growth” as accounting for 80 percent of the change in demand, but they also say 20 percent of the demand is due to the Patient Protection and Affordable Care Act/Obamacare. So, while Obamacare is not the sole cause of the coming primary care physician shortage, the provisions of the law will exacerbate the shortage.

A methodological limitation of the study noted by some is that “the model assumes continuation of key trends in service utilization, practitioner practice patterns, and practitioner production.” In other words, the study is a straight line projection of current supply and demand for physicians, and does not assume any changes in delivery system innovation, payment, or utilization. This is a notable limitation, since changes in physician practice patterns, payments, and utilizations continue to evolve each year.  Certainly, there will be changes to a number of dynamics impacting physician utilization between now and 2020.

However, while the methodological approach is a limitation of the study’s findings, it is a relatively small limitation and should not be read to negate the study’s findings.  In fact, many observers have argued that this straight line projection of current supply and demand is actually the best way to project physician shortages for 2020, since that date is in the relative near term, just about six years away.  (This approach contrasts with other workforce shortage projection which forecast supply and demand over a longer time horizon and therefore increase the uncertainty of those projections).

Finally, as the study notes, the primary care physician shortages could be worse in some places across the country. “The national averages reported here mask substantial distributional disparities across the United States,” the report warns. Additionally, some underserved localities could see a greater need for various specialties as well.

WASHINGTON- Today, Senate Homeland Security and Governmental Affairs Committee Chairman Tom Carper (D-Del.) and Ranking Member Tom Coburn (R-Okla.) and Representatives Peter Roskam (R-Ill.) and John Carney (D-Del.) commended the Senate Finance Committee for including an amendment to the SGR Repeal and Medicare Beneficiary Access Improvement Act of 2013. The amendment, titled “Preventing and Reducing Improper Medicare and Medicaid Expenditures,” is based on the bill, “Preventing and Reducing Improper Medicare and Medicaid Expenditures Act of 2013” (PRIME Act), which was originally introduced as a bill by Senators Carper and Coburn and Representatives Roskam and Carney in June 2013. Senators Bill Nelson (D- FL), Michael Bennet (D-CO), Mike Enzi (R- WY), John Thune (R- SD), Richard Burr (R-NC) and Johnny Isakson (R- GA) joined as cosponsors of the Finance Committee Amendment.

Among its provisions, the amendment would: curb improper or mistaken payments made by Medicare and Medicaid; establish stronger fraud and waste prevention strategies within Medicare and Medicaid to help phase out the practice of "pay and chase”; take steps to help states identify and prevent Medicaid overpayments; and improve the sharing of fraud data across state and federal agencies and programs.

“I want to thank my colleagues on the Finance Committee for including key provisions of the PRIME Act as an amendment to the bill we considered today,” said Senator Carper, a member of the Senate Finance Committee. “I have been working with my House and Senate colleagues on this legislation for years. I believe this measure will make some commonsense reforms to Medicare and Medicaid that will, ultimately, save taxpayers a lot of money. By cracking down on vulnerabilities that put tax dollars at risk of waste, fraud and abuse, we can ensure that these programs remain sustainable for years to come and continue to provide quality care and services to our nation’s poor, disabled, and elderly.”

“I am pleased the Finance Committee included provisions of the PRIME Act as an amendment to the Medicare physician legislation the Committee considered today,” Dr. Coburn said.  “The PRIME Act represents a positive step forward to reducing waste and fraud in Medicare and Medicaid payments, meaning scarce resources will be better preserved for those that need them most.”

“Medicare waste, fraud, and abuse is a serious problem that takes billions of dollars each year away from providing needed health services to our nation’s seniors. Our common-sense PRIME Act uses the kind of protections against fraud and abuse that for years the private sector has used to great effect,” said Congressman Roskam, a member of the House Ways and Means Committee. “By replacing the antiquated system of pay-and-chase, we can strengthen Medicare for current seniors and future generations. I am pleased that this effort continues to gain steam both in the House and Senate, and will continue our work to push PRIME across the finish line to save seniors and taxpayers billions.”

“The provisions in the PRIME Act will strengthen Medicare and Medicaid while protecting our nation’s seniors from becoming victims of fraud,” said Congressman Carney. “It’s not easy to find something that Democrats and Republicans can agree on, but combating waste, fraud and abuse while saving billions of taxpayer dollars is a no-brainer. I’m pleased to partner with Senator Carper on this bipartisan proposal and encouraged that the Senate Finance Committee recognized the importance of taking these steps. I’m hopeful the House will do the same.”

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Dec 12 2013

SHAHEEN, COBURN INTRODUCE BIPARTISAN BILL TO LIMIT SPENDING ON OFFICIAL PORTRAITS

Legislation would protect taxpayers from excessive spending on oil paintings of government officials

(Washington, DC) – U.S. Senators Jeanne Shaheen (D-NH) and Tom Coburn (R-OK) introduced bipartisan legislation today to rein in excessive spending on oil paintings of government officials. The bipartisan bill would put a cap on the amount of taxpayer support for the portraits and limit the practice to those officials in the line of succession for the presidency.

“At a time when vital services and programs are facing cuts, we need to be looking at every way we can stop excessive spending practices in Washington,” Shaheen said. “Official portraits should be done in a way that protects taxpayers, as we do in New Hampshire.”

“Hardworking taxpayers shouldn’t foot the bill for lavish official portraits, especially when government officials spend more on paintings of themselves than some Americans make in a year,” Dr. Coburn said. “This bill reins in excessive spending on such portraits and protects taxpayers from funding waste.”

ABC News and The Washington Times have reported that the Obama Administration has spent nearly $400,000 on commissioned portraits of agency directors and Cabinet secretaries over the last two years. According to a 2008 Washington Post study of these contracts, these portraits can cost upwards of $50,000. 

The bipartisan Responsible Use of Taxpayer Dollars for Portraits Act would limit taxpayer support for portraits to $20,000. The bill clarifies that for portraits that cost more than $20,000, other funds may be used. In addition, the legislation would only allow federal funds to be provided for portraits of officials in line for the presidency. 

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(WASHINGTON, D.C.) – Today, U.S. Senators Tom Coburn, M.D. (R-OK) and Dianne Feinstein (D-CA) introduced with eight cosponsors The Corn Ethanol Mandate Elimination Act of 2013.  The bill, cosponsored by Sens. Richard Burr (R-NC), Susan Collins (R-ME), Bob Corker, (R-TN), Kay Hagan (D-NC), Jeff Flake (R-AZ), Joe Manchin (D-WV), Jim Risch (R-ID), and Patrick Toomey (R-PA), eliminates the corn ethanol mandate within the Renewable Fuel Standard (RFS) which requires a yearly increase in the amount of renewable fuel that must be blended into the total volume of gasoline refined and consumed in the United States.  The RFS, which was first enacted in 2005 and then expanded in 2007, requires refiners and blenders to use 16.55 billion gallons of renewable fuel in 2013. 

“The time to end the corn ethanol mandate has arrived,” Dr. Coburn said. “This misguided policy has cost taxpayers billions of dollars, increased fuel prices and made our food more expensive.  Eliminating this mandate will let market forces, rather than political and parochial forces, determine how to diversify fuel supplies in an ever-changing marketplace.  I’m grateful my colleagues on both sides of aisle are prepared to take this long-overdue step to protect consumers and taxpayers from artificially high fuel and food prices.” 

“I am pleased to join Senator Coburn and others on a bill to eliminate the federal corn ethanol mandate from the Renewable Fuel Standard, while maintaining provisions designed to grow the low-carbon biofuel industry,” Senator Feinstein said.  Under the corn ethanol mandate in the RFS, roughly 44 percent of U.S. corn is diverted from food to fuel, pushing up the cost of food and animal feed and damaging the environment. Oil companies are also unable to blend more corn ethanol into gasoline without causing problems for automobiles, boats and other vehicles. I strongly support requiring a shift to low-carbon advanced biofuel, including biodiesel, cellulosic ethanol and other revolutionary fuels. But a corn ethanol mandate is simply bad policy.”

 “I have long opposed efforts to increase the use of corn ethanol as a fuel additive and am pleased to support this bipartisan legislation,” Senator Collins said.  “Corn ethanol blended gasoline poses economic and safety risks by damaging or destroying engines of older cars, boats, and snowmobiles, has caused food and feed prices to rise, and presents significant environmental concerns.   Expanding alternative, domestic fuel sources remains critically important for energy independence, however, and I continue to support the development of promising advanced biofuels to meet our energy and environmental challenges.” 

 “It’s become obvious that the Renewable Fuel Standard is having some unintended consequences, like higher food prices and fuel market disruptions that could raise gas prices,” Senator Corker said.  “This bill is a common-sense step to mitigate those consequences and move our energy policy in a direction that better reflects the realities of our domestic fuel demand and production.”

“Diverting corn to produce ethanol hurts hardworking families by raising the cost of food,” Senator Manchin said. “While I believe that we need to develop alternative energy sources as part of a domestic, all-of-the-above energy approach, we must be smart about where we make our investments. It is long past time to eliminate these harmful corn ethanol requirements that do little to make us energy independent, while raising the cost of food in these already tough economic times.”

 “Since 2005, fuel suppliers like those in Trainer and Philadelphia have been forced to blend millions of gallons of biofuels - notably corn ethanol - into the nation's gasoline supplies,” Sen. Toomey said.  “This flawed central planning harms the viability of good paying jobs, drives up gas prices, increases food costs, and harms the environment. This is the government using corporate welfare to shower money on a favored industry and send the bill to the general public. Labor leaders, business, and environmental groups have pushed back against this harmful regulatory regime.  It’s time to repeal the requirement that directs more corn in our gas tank at the expense of the hardworking men and women of Pennsylvania.”

 Additional background information here.     

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Dr. Coburn provided the following opening statement before the U.S. Senate Homeland Security and Governmental Affairs Committee hearing on the nomination of Alejandro Mayorkas for the position of Deputy Secretary of the Department of Homeland Security.    

(WASHINGTON, D.C.) – Senate Homeland Security and Governmental Affairs Committee Tom Carper (D-Del.) and Ranking Member Tom Coburn, M.D. (R-OK), today highlighted a new report from the Government Accountability Office (GAO) entitled, “Reverse Auctions: Guidance Is Needed to Maximize Competition and Achieve Cost Savings.”  In the report, GAO found that agencies can save money by better utilizing reverse auction services, a tool that, when used properly, can increase competition and drive down prices. While GAO found that 65% of the auctions conducted by the Army, Department of Homeland Security, the Department of the Interior, and Department of Veterans Affairs involved some level of interactive bidding where multiple vendors submitted multiple bids, GAO also found one third of the reverse auctions did not have fully interactive bidding, meaning that the potential benefits of competition weren’t fully realized. For example, the report also shows agencies conducted 3,617 auctions costing $1.7 million in service fees where only one vendor participated and submitted only one bid.

“Reverse auctions are a promising, innovative way for agencies to save taxpayer dollars. As with any tool, though, there is a right way and a wrong way to use it,” said Chairman Carper. “Today’s Government Accountability Office (GAO) report makes it clear that agencies need better, government-wide guidance to eliminate confusion on when reverse auctions should be used and to ensure that reverse auctions are used properly to maximize competition and savings.  I look forward to working with the Office of Management and Budget to see that it implements GAO’s recommendations and issues guidance in a thorough and timely manner.”

“Today’s report shows that while reverse auctions are one of the many valuable tools available to assistant agencies in saving taxpayers millions of dollars when awarding contracts, much more work is needed to ensure this tool is used the right way,” Dr. Coburn said.  “Agencies should always weigh the potential savings benefits against the cost of tools like reverse auctions to determine how to get the best deal for the taxpayer. I hope that the Office of Management and Budget (OMB) implements GAO’s recommendations to help federal agencies make better use of this innovative approach to saving money.”

Additional highlights of the GAO report include:

  • GAO calculated savings from reverse auctions in 2012, defined as the difference between the target price set by the agency at the beginning of the auction and the final award price of the contract, of $98 million.
  • GAO also noted that, in some cases, agencies are actually paying two fees to use reverse auctions. When agencies buy goods and services under the GSA Schedules contracts, for example, they pay a 0.75% fee that is built into the pricing. If they use a reverse auction to buy off the Schedules, they may also pay an additional fee to the reverse auction vendor. For example, agencies paid a total of $1.3 million to GSA and VA in fees to use their contracts, and an additional $2.8 million in reverse auction fees.
  • GAO found that agencies are also not analyzing the full costs and benefits of reverse auctions effectively and identified a lack of guidance on how to use this tool effectively. As a result, GAO recommended that OMB update federal acquisition regulations and issue guidance to federal agencies to improve their use of reverse auctions.

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In an updated report, the Congressional Research Service (CRS) provided an examination of the identified legislative and other actions taken to repeal, defund, and delay the new health care law Patient’s Choice and Affordable Care Act since the law’s enactment.  The report shows that since the new health care law passed in 2010, Congress has passed 15 bills to repeal or rescind funding for portions of the law, and President Obama’s administration has delayed implementation of 6 provisions of the law, including the small business exchange (SHOP) and the employer mandate.

Read the full report here.

Dec 03 2013

Dr. Coburn Calls for Preservation of In-Office Ancillary Services Exemption in SGR Reform

Pens Letter with Doctor Senators Barrasso, Paul, Boozman

In a letter to the Senate's Majority and Minority Leaders, the Senators express their strong support for preserving the “in-office ancillary services exception” (IOASE) to federal physician self-referral regulations (the “Stark” law). This provision permits physician practices to provide critical services –including radiation therapy, diagnostic imaging, pathology, and physical therapy –in an integrated and coordinated fashion within their respective practices. 

The Senators wrote that they were "concerned that limiting the in-office ancillary services exemption would introduce additional cost and time barriers to patients receiving medically-appropriate screenings and treatments."

"As medical practitioners with decades of combined experience in treating patients," they wrote, " we believe [the Administration's] changes [to the in-office ancillary services exemption] would effectively force more patients to receive these services in hospital settings, thereby increasing costs to patients in private and public programs."  

Moreover, the Senators noted that, "given the number of individuals enrolled in Medicare, Medicaid, and other federal health care programs, a significant portion of these increased costs will also burden taxpayers whose tax dollars fund these public programs." Another serious concern they identified with changes to the IOASE would be that "reducing the use of these services in the outpatient setting could not only drive the services to a higher cost inpatient setting, but could accelerate current trends in provider consolidation and further increase system costs over the long term." 

They also noted the unfair advantage changes would give some provider types. "We believe as an issue of basic fairness, the federal government should not disproportionately favor one care setting over another, especially when such a change will increase costs to taxpayer-backed federal health programs," they wrote. "Repeal of the IOASE would literally make it illegal for physician practices to integrate these ancillary services that would be legally integrated in an inpatient setting."

(WASHINGTON, D.C.) – U.S. Senator Tom Coburn, M.D. (R-OK), ranking member of the Senate Homeland Security and Governmental Affairs Committee, released the following statement regarding a new Inspector General report revealing serious gaps in DHS’s own cybersecurity: 

“This report shows major gaps in DHS’s own cybersecurity, including some of the most basic protections that would be obvious to any 13-year-old with a laptop.  DHS doesn’t use strong authentication.  It relies on antiquated software that’s full of holes.  Its components don’t report security incidents when they should.  They don’t keep track of weaknesses when they’re found, and they don’t fix them in time to make a difference.  

“President Obama has called on the private sector to improve its cybersecurity practices to ensure that our nation’s critical infrastructure is not vulnerable to an attack.   DHS and other agencies must be held to at least the same standard.  

“The fact is the federal government’s classified and unclassified networks are dangerously insecure, putting at risk not only U.S. national security, but the nation’s critical infrastructure and vast amounts of our citizens’ personally identifiable information. 

“We spend billions of taxpayer dollars on federal information technology every year.  It is inexcusable to put the safety and security of our nation and its citizens at risk in this manner.” 

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November 2013

Over the past year, labor unions have been seeking exemptions from aspects of the Patient Protection and Affordable Care Act (often called “Obamacare”).  In recent months, unions have asked President Obama’s administration and Democrat leaders in Congress to provide union-employees, who have employer-provided health insurance plans, the same Obamacare Exchange subsidies given to Americans who do not have employer-provided insurance. 

Unions have also asked to be exempted from the reinsurance fees that were created by Obamacare.  The reinsurance starts in 2014 and requires all self-insured companies to pay a tax for each person covered under their health care plan. For 2014, the reinsurance fee set by the government is $63 per person. The tax was designed to help insurance companies operating in the Obamacare Exchanges to cover unexpected costs.  

Nonpartisan analysis shows that the law is encouraging employers to reduce workers’ hours, cut jobs, and shift the increased costs of health insurance to workers.  While Dr. Coburn shares the concerns that Obamacare is reducing workers’ hours and increasing the cost of health insurance, these burdens are being felt by tens of millions of American—union workers and non-union workers alike. Dr. Coburn does not believe unions – who supported Obamacare’s passage – should be given special exemptions from Obamacare while other Americans are forced to comply with all aspects of this unworkable, unaffordable, and unfair law.

On September 18, 2013, Dr. Coburn, along with other senators, warned President Obama’s director for the Office of Management and Budget that the Administration should not unlawfully allow taxpayer-funded Obamacare subsidies to be given to workers in union-sponsored health insurance plans.  As the letter explained, under the law, these subsidies are only allowed to be provided to consumers who purchase health coverage through the Exchanges and who do not have employer-provided coverage.  Individuals with employer-provided insurance are ineligible for these subsidies, and an exception should not be provided for individuals with multiemployer (union) plans.  

The Administration responded to Dr. Coburn’s letter to say that they do not intend to provide these Exchange subsidies through the authority of the Internal Revenue Service. However, they have not yet clarified whether or not an exception may be given through the authorities of the U.S. Department of Labor. 

On November 14, 2013, Dr. Coburn joined other Senators in sending a letter to the Director of the Office of Management and Budget regarding our opposition to a proposed rule to provide unions an exemption from the reinsurance fee.   While this fee is costly for the 26 million Americans with health benefits through unions, this tax also burdens nearly 170 million Americans with employer-sponsored health insurance.  Dr. Coburn believes this tax on health insurance should be removed, but does not believe anyone should receive special treatment. All Americans should receive the same consideration from President Obama’s Administration. 

On November 19, 2013, Dr. Coburn joined 10 other Senators in introducing the Union Tax Fairness Act (S. 1724). This bill would prevent union health care plans, known as Taft-Hartley plans, from being exempted from the ObamaCare reinsurance tax. 

Dr. Coburn will continue his efforts to delay, dismantle, and disarm Obamacare’s negative impact on Americans’ health care.  However, in the process, all Americans must be treated equally under the law and as a matter of fairness, unions should not receive special exemptions that do not apply to all Americans. 

Supplementary Materials:

  • 1/30/2013— Read the Wall Street Journal article highlighting union efforts to secure exemptions from the ACA here: http://on.wsj.com/15SoeSQ.
  • 2/7/2013—Senators write to President Obama opposing unlawful expansion of subsidies to union health insurance plans. Read the letter here: http://1.usa.gov/12z7X1U.
  • 9/13/2013—President Obama’s Administration responds that premium subsidies will not be given to union members for employer-sponsored health insurance through IRS, but leaves door open for exemption through the Department of Labor (DOL). Read the letter here: http://wapo.st/1gc0qIU.
  • 9/18/2013—21 Senators wrote to oppose any regulation providing unions a special exemption through the DOL. Read the letter here: http://1.usa.gov/1fufmo1.
  • 10/30/2013—Read the proposed rule issued by the Centers for Medicare and Medicaid Services (CMS) to exempt unions from reinsurance fee here: http://1.usa.gov/1fPVXxg.
  • 11/13/2013—Senators write to oppose CMS proposed rule. Read the letter here: http://1.usa.gov/1as2wE3

Nov 21 2013

COBURN, BOXER PRAISE PRESIDENT OBAMA FOR SIGNING BIPARTISAN HOPE ACT

Boxer-Coburn Legislation Could Save Lives and Reduce Delays in Receiving Organ Transplants by Ending Outdated Ban on Research into Organ Donations Between HIV-Positive Patients

Washington, D.C. – U.S. Senators Barbara Boxer (D-CA) and Tom Coburn (R-OK) praised President Obama for signing their bipartisan legislation, the HOPE Act (HIV Organ Policy Equity Act), which ends the federal ban on research into organ donations from HIV-positive donors to HIV-positive recipients. The bipartisan measure would open a pathway to the eventual transplantation of these organs and could provide life-saving assistance to HIV-positive patients who are at risk of liver and kidney failure. 

The Boxer-Coburn bill passed the Senate in June, and the House version, introduced by Representatives Lois Capps (D-CA) and Andy Harris (R-MD), was passed earlier this month by a voice vote.

“I am proud that President Obama signed our bipartisan legislation into law today,” Senator Boxer said. “Ending this outdated research ban will save lives and give hope to thousands of patients and their families.”

Senator Coburn said, “I applaud the President for signing this important piece of bipartisan legislation into law and am hopeful it produces encouraging results for HIV-positive individuals.”

“After years of work on crafting this legislation, building bipartisan, bicameral consensus, and collaborating with advocates in the HIV and medical communities, I am thrilled to see the President sign the HOPE Act into law today,” Representative Capps said. “This proves that even in a divided Congress, we can come together to pass common sense bills with bipartisan efforts that will help save lives, improve health outcomes, and save taxpayer dollars.”

Representative Harris said, “This legislation gives new hope to all of those waiting for organ transplants. As a physician who has performed anesthesia during organ transplants, I have seen firsthand the life-saving joy that receiving an organ can bring to patients and their families.  I appreciate the bipartisan support this common sense change to an outdated law has received.”

The ban on the donation of organs from HIV-positive donors and related research was enacted as part of the Organ Transplant Amendments Act of 1988, but is now medically outdated. With the advances in antiretroviral therapy, many HIV-positive patients are living longer lives. These patients are now more likely to face chronic conditions such as liver and kidney failure, for which organ transplants are the standard form of care.

There are currently more than 100,000 patients on the active waiting list for organ transplants in the United States and about 50,000 people are added to the list each year – but fewer than 30,000 transplants are performed annually. Tragically, many patients die while waiting for a transplant.

According to a study published in the American Journal of Transplantation, allowing organ transplants from HIV-positive donors to HIV-positive recipients could increase the organ donation pool by 500-600 donors a year and save hundreds of lives. 

The bipartisan Senate bill was co-sponsored by Senators Tammy Baldwin (D-WI), Rand Paul (R-KY), Richard Burr (R-NC), Michael Enzi (R-WY), Elizabeth Warren (D-MA), Mark Kirk (R-IL), Dianne Feinstein (D-CA), Mary Landrieu (D-LA), Brian Schatz (D-HI), Richard Blumenthal (D-CT), Roy Blunt (R-MO), Mark Pryor (D-AR) and Carl Levin (D-MI). 

This legislation also has broad support from the medical community and advocacy groups, including the American Medical Association, American Society of Nephrology, American Society of Transplant Surgeons, American Society of Transplantation, Association of Organ Procurement Organizations, American Academy of HIV Medicine, American Society for the Study of Liver Disease, the Human Rights Campaign, National Minority AIDS Council, HIV Medicine Association, National Coalition for LGBT Health, Infectious Diseases Society of America, Gay and Lesbian Medical Association, United Network for Organ Sharing, The AIDS Institute, amfAR (American Foundation for AIDS Research), Lambda Legal, the Treatment Access Group (TAG), and AIDS United. 

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(WASHINGTON, D.C.) – Today, U.S. Senator Tom Coburn, M.D. (R-OK) Ranking Member of the Homeland Security and Governmental Affairs Committee and member of the Banking, Housing and Urban Affairs Committee released the following statement on Janet Yellen’s nomination to serve as chair of the Federal Reserve: 

“I am supporting Janet Yellen’s nomination because she is unquestionably qualified to serve as the next chair of the Federal Reserve.   My support of her, however, is in no way an endorsement of the Federal Reserve’s risky quantitative easing policy.  Unfortunately, the Federal Reserve has attempted to fill a leadership and policy vacuum that has been created by an administration and Congress that has refused to address our economic challenges and implement pro-growth economic policies.  Yet, I’m concerned quantitative easing will only create new asset bubbles and will serve as a bailout for politicians who don’t want to make hard choices. 

In the future, the Federal Reserve’s decisions will be dictated by pragmatism rather than ideology for the simple reason that we can’t operate indefinitely on borrowed or printed money.   Yellen will be well-suited to navigate the treacherous waters ahead.”  

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In Letter to Health & Human Services Secretary Kathleen Sebelius, Lawmakers Write, “Recent events, including the rollout of the health care marketplace exchanges on October 1, have deepened our concerns about the success of CO-OPs and the probability of taxpayers being repaid for the $2 billion that was loaned to these plans.”

WASHINGTON – Today, five Republican lawmakers wrote to Health and Human Services Secretary Kathleen Sebelius and questioned the success of the Consumer Operated and Oriented Plans (CO-OP) loan program – a new ObamaCare program that has issued nearly $2 billion in loans to non-profit health insurance issuers – and whether taxpayer dollars would be repaid on time.  In the letter, spearheaded by Finance Committee Ranking Member Orrin Hatch (R-Utah), the lawmakers cited two Health and Human Services Inspector General (HHS-IG) reports that identified a number of risks within the CO-OP program and requested a status update of the challenges being faced.

“Recent events, including the rollout of the health care marketplace exchanges on October 1, have deepened our concerns about the success of CO-OPs and the probability of taxpayers being repaid for the $2 billion that was loaned to these plans,” wrote the lawmakers.

In addition to Hatch, the letter was signed by Senator Lamar Alexander (R-Tenn.), Ranking Member of the Senate Health, Education, Labor and Pensions (HELP) Committee, Senator Mike Enzi (R-Wyo.), Ranking Member of the HELP Subcommittee on Children and Families, Senator Tom Coburn (R-Okla.), Ranking Member of the Senate Homeland Security and Government Affairs Committee, and Rep. Charles Boustany (R-La.), Chairman of the House Ways and Means Subcommittee on Oversight.

Earlier this year, a number of Republican Senators asked the Government Accountability Office to conduct an independent audit examining the effectiveness of CO-OPs. The members also requested GAO evaluate CO-OPs’ efforts related to covering the uninsured, providing lower-cost plans, and repaying loans from the U.S. Department of Health and Human Services. 

Last year a similar group of Republican Senators and Representatives wrote to Secretary Sebelius regarding the funding and structure of the CO-OP program, however the Administration’s response, received nine months later, lacked details. Since CO-OPs became operational on October 1st, reports have indicated serious problems with the program. HHS, for example, has already terminated the loan to the Vermont CO-OP. It remains unclear as to whether the group will be able to repay the loan. The lawmakers asked Secretary Sebelius to respond to them by December 6.

Also last year, in an oversight report on ObamaCare, two Republican Senators penned a data-driven critique of the CO-OP program. Examining HHS’s own projections that they expect a third of all health insurance cooperatives to fail to repay their taxpayer-backed loans, the Senators warned the CO-OP program could be another Solyndra, citing the failed energy company that collapsed and failed to repay millions in taxpayer dollars.

The text of the letter to Secretary Sebelius is below and a signed copy can be found HERE:

The Honorable Kathleen Sebelius

Secretary of Health and Human Services

U.S. Department of Health and Human Services

200 Independence Avenue, SW

Washington, DC 20201 

Dear Secretary Sebelius: 

Last year, we wrote to you regarding the Department of Health and Human Services’ (HHS) implementation of the Consumer Operated and Oriented Plans (CO-OP) loan program, which gives loans to help create non-profit health insurance issuers.  Recent events, including the rollout of the health care marketplace exchanges on October 1, have deepened our concerns about the success of CO-OPs and the probability of taxpayers being repaid for the $2 billion that was loaned to these plans. 

The Patient Protection and Affordable Care Act (PPACA) created the CO-OP loan program, which offers funding to non-profit health insurance issuers that offer qualified health plans in the individual and small group markets.[1]  As of January 2, 2013, the Centers for Medicare & Medicaid Services (CMS) had awarded loans totaling $1.98 billion in funding to 24 CO-OPs operating in 24 states.[2]  The loans come in two forms:(1) startup loans, which assist with costs of establishing CO-OPs; and (2) solvency loans, which help CO-OPs meet state insurance solvency and reserve requirements.[3]

When we wrote to you in May 2012, we noted that there was little evidence that the CO-OP program would promote greater competition and lower costs in most state insurance markets, and we questioned whether HHS had significantly underestimated the financial risk that these entities pose to the Federal Treasury.  The responses to our letter from CMS Administrator Marilyn Tavenner—which were delivered on your behalf more than 9 months after we sent our letter—did little to assure us that HHS or CMS was prepared to address these issues. 

Indeed, a recent HHS Inspector General report identified many of the same issues that we discussed in our previous letter, including several immediate challenges: the “tight” 18-24 month window that CO-OPs had from receiving financing to being ready enroll consumers; market uncertainty; and the difficulty of quickly identifying and contracting with the right health care providers and vendors for key services.[4]  Additionally, as of June 2013 – just four months before the October 1 exchange rollout – five of the CO-OPs had not yet been issued insurance licenses by their states.[5] 

The HHS Inspector General issued a second report in July 2013 that raised even greater concerns about the viability of the CO-OP program.[6]  The Inspector General found “little evidence of private monetary support in any of the 16 applications” that the Inspector General reviewed – applications which were all approved for funding.[7]  Perhaps more troubling, the Inspector General found that “11 of 16 CO-OPs reported estimated startup expenditures in their applications that exceeded the total startup funding ultimately provided by CMS.”[8]  The Inspector General concluded that “there is a risk that CO-OPs could exhaust all startup loan funding before they are fully operational or before they earn sufficient operating income to be self-supporting” based on “unforeseen risks (such as limited enrollment) or barriers (such as uncertainty about operations of the State-based or federally facilitated marketplaces or a State’s denial of insurance licensure)”.[9] 

Although it has only been a few weeks since the health care exchange marketplace was launched, some of these fears have already been realized.  In fact, The Washington Post reported that “the [exchange] problems, in particular the malfunctioning federal Web site, are hitting the co-ops hard because they depend on the exchanges for business.”[10]  The Post cited an internal review by Deloitte that uncovered financial problems in the Maryland, New York, and New Jersey CO-OPs.  Moreover, the Post reported that after being denied a license by the state, the Vermont CO-OP had its loan terminated by HHS, and the CO-OP “said it will be unable to repay $4.5 million that had been spent.”[11]  Similarly, the Ohio CO-OP also missed the deadline for getting licensed and its CEO was uncertain about whether the CO-OP would be able to continue to operate.[12] 

These recent reports have further underscored our valid concerns about the nature of the CO-OP program and have illustrated the need for effective management by HHS and CMS, as well as consistent Congressional oversight.  Therefore, in the interest of taxpayers and individuals enrolled in these plans, please provide our offices with the following information: 

  1. What steps did HHS take to actively monitor the status of CO-OP awardees’ license applications? 
  2. Have all 24 CO-OPs received state insurance licenses?  For any CO-OPs that have not yet been licensed by states in which they operate, when do you expect that they will receive a license?
  3. Why did the Ohio CO-OP miss the deadline to receive its state insurance license?
  4. When do you anticipate that the CO-OPs will become fully operational?  What is HHS doing to ensure that CO-OP startup funds are not exhausted before they become fully operational? 
  5. What has HHS done in response to the Inspector General’s finding that “11 of 16 CO-OPs reported estimated startup expenditures in their applications that exceeded the total startup funding ultimately provided by CMS”?  Specifically, has HHS required these 11 CO-OPs to make any adjustments to their budgets and/or operation plans?
  6. For the 11 CO-OPs identified in the previous question, please explain why CMS elected to fund these entities at a lower level than the estimated startup expenditures.
  7. Following the problematic launch of the HealthCare.gov website, what steps has HHS taken to ensure that CO-OPs are able to signup new customers using alternative means?
  8. Have CO-OPs submitted all required quarterly and semiannual reports and quarterly disbursement requests?  If not, what steps has HHS taken?
  9. Under the terms of the CO-OP program, a CO-OP is required to inform CMS one month in advance if it believes that it will be unable to reach any of its milestones.  Identify each CO-OP that has made this notification to CMS.  In each instance, provide the CO-OP’s explanation about why it made the notification and what steps, if any, CMS took in response to the notification.
  10. Has HHS delayed or discontinued funding to any co-op as the result of the CO-OP’s failure to meet the operating requirements.
  11. The Inspector General’s first July 2013 report indicates that CMS delayed portions of startup loans to five co-ops because they failed to reach milestones on time.  What is the operating status of each of these CO-OPs?
  12. What has HHS done to address the financial problems in the Maryland, New York, and New Jersey CO-OPs?  Has HHS made any modifications to the loan terms of these CO-OPs?
  13. Please provide all documents related to (1) the Vermont CO-OP’s failure to obtain an insurance license and (2) HHS’s decision to terminate the Vermont CO-OP’s loan.
  14. What steps has HHS taken to recover funds from the Vermont CO-OP
  15. Out of the $1.98 billion awarded to CO-OPs, what amount does HHS expect to be repaid?  What is the period of time by which HHS expects these funds to be repaid?

We appreciate your assistance in helping us better understand the current state of the CO-OP program.  Due to the urgency of the reported problems associated with the CO-OPs, we ask that you respond to this letter in a more timely fashion than to our previous letter and provide responses no later than December 6, 2013.

 

Sincerely,

 

 

###


[1] PPACA, § 1332(a)(2).  45 C.F.R. § 156.515(c)(1).

[2] HHS Office of the Inspector General, “The Centers for Medicare & Medicaid Services Awarded Consumer Operated and Oriented Plan Program Loans in Accordance with Federal Requirements, and Continued Oversight is Needed,” A-05-12-00043 (July 2013) at 2.

[3] 45 C.F.R. § 156.505.

[4] HHS Office of Inspector General, “Early Implementation of the Consumer Operated and Oriented Plan Loan Program,” OEI-01-12-00290 (July 2013) at 10.

[5] Id. At 9.

[6] HHS Office of the Inspector General, “The Centers for Medicare & Medicaid Services Awarded Consumer Operated and Oriented Plan Program Loans in Accordance with Federal Requirements, and Continued Oversight is Needed,” A-05-12-00043 (July 2013) .

[7] Id. at ii.

[8] Id.

[9] Id. at 6.

[10] Health CO-OPs, Created to Foster Competition and Lower Insurance Costs, Are in Danger, October 22, 2013, available at http://www.washingtonpost.com/politics/health-co-ops-created-to-foster-competition-and-lower-insurance-costs-are-facing-danger/2013/10/22/e1c961fe-3809-11e3-ae46-e4248e75c8ea_story.html.

[11] Id.

[12] Id.

WASHINGTON— Today, the Senate Homeland Security and Governmental Affairs Committee held a business meeting to consider Jeh C. Johnson’s nomination to be Secretary of the Department of Homeland Security (DHS). Committee Chairman Tom Carper (D-Del.) and Ranking Member Tom Coburn (R-Okla.) highlighted the Committee’s decision to favorably report out this important nomination by voice vote. The nomination now goes to the full Senate for consideration. 

“Jeh Johnson’s nomination comes at a critical time for the Department of Homeland Security and for our nation and I thank my colleagues on the Homeland Security and Governmental Affairs Committee for approving his nomination,” said Chairman Carper. “If confirmed by the full Senate, Mr. Johnson will be met with the dual challenge of combating threats to our nation while also working to further strengthen management at the Department and encourage more cohesion among the Department’s components. This is no easy task, but I am confident that we have a nominee who is up to the challenge. I know this because Mr. Johnson has already served our nation with distinction in difficult jobs -- once as the Air Force’s top lawyer and once as the top lawyer for the entire Department of Defense.  He now brings the skills and experiences that helped him excel in those roles to the top post at the Department of Homeland Security, where I am certain that he will be a strong and effective leader. I now urge my colleagues in the full Senate to swiftly take up, and approve his nomination so Mr. Johnson can get to work.”

“Mr. Johnson is well-equipped to face the enormous task of DHS Secretary,” Dr. Coburn said.  “With so much at stake and with limited financial resources, DHS must work with Congress to ensure that spending on counterterrorism and intelligence programs makes us safer.  The DHS Secretary is integral to this process and is tasked with balancing freedom, privacy and civil liberties with security.  Mr. Johnson demonstrates the qualifications necessary to work side by side with Congress toward these goals, and I am hopeful the Senate will confirm him as soon as possible.”   

###

Coburn offered the following amendments to S. 1197,  the National Defense Authorization Act of 2014.  Conservative estimates conclude that DOD could save over $386 billion in 10 years through reductions in low priority spending.  

Amendment #2155 - Requires DOD to obtain an audit with an unqualified opinion by FY 2018.  More information here

Amendment #2156 - Eliminates DOD non-defense spending and transfers duplicative programs to other agencies. More information here

Amendment #2157 - Establishes position precedence and qualifications for DOD Undersecretary of Defense for Management. More information here

Amendment #2158 - Requires disposal of DOD excess property by public sale or auction. More information here

Amendment #2159 - Requires the Department of Defense to use existing authority to implement GAO duplication recommendations. More information here

Amendment #2160 - Requires DOD to publish annually online their unclassified unobligated balances by account and an explanation of why they are unobligated. More information here

Amendment #2161 - Reduces DOD tuition assistance program and limits to use as a retention tool where the military services have a critical-needs shortage of military personnel. More information here

Amendment #2162 - Strikes section 524, which restricts use of DOD tuition assistance funds at for-profit institutions. More information here

Amendment #2163 - Prohibits the Department of Defense from employing tax cheats. More information here

Amendment #2164 - Withholds funding for acquisition of aircraft and equipment for the Afghan Security Forces until the Secretary of Defense submits a plan to Congress confirming the plan to transfer the C-27A planes to another agency or entity. More information here

Amendment #2165 - Withholds funding for acquisition of aircraft until the Secretary of Defense submits a plan to Congress confirming the plan to transfer the Air Force’s C-27J planes to another agency or entity. More information here.

Amendment #2166 - Expresses the Sense of the Senate that the small arms and ammunition used by the United States Army should be superior to the small arms and ammunition used by potential threat nations, foreign allied militaries, and U.S. domestic law enforcement. More information here

Amendment #2520 - To require a report on plans for the disposition of the C-27A aircraft. 

 

CODE RED: Obamacare After One-Month of Enrollment


Enrollments into Obamacare Exchanges from Oct 1-Nov. 2, 2013:

  • The House Ways and Means Committee has this good breakdown:
    • HHS official projections for October: 494,620
    • Inflated “enrollment” numbers for October:106,185
    • Inflated “enrollment” numbers for October in state-run Exchanges: 79,391
    • Inflated “enrollment” numbers for October in federally-run Exchange: 26,794
  • The numbers show that, in states with the federally-run Exchange, on average, there were only 23 people per day that enrolled during the first month.
  • In the first month of the exchanges, 106,185 individuals selected an insurance plan from a federal or state exchange, which includes people who have and have not paid their first premium.
  • Overall:
    • HHS says 396,261 people have been determined to be eligible for Medicaid or CHIP. This means that for every 3.7 people added to Medicaid/CHIP, only 1 person enrolled in private coverage.
    • 502,446 is the total number of people enrolled in a private plan or who are eligible for Medicaid/CHIP.
    • Only 10% of people who were determined to be eligible for a marketplace plan have actually selected a plan –4% within federal marketplace, and 21% within state-based marketplaces.
  • 74% of applications were completed online, 26% were filled out on paper
  • HHS says “the marketplaces have helped a total of 1,477,853 persons by determining or assessing that they are either eligible to enroll in a marketplace plan, Medicaid, or CHIP.” However, only 34% of people they claim they have helped have actually selected a private insurance plan or are eligible for Medicaid/CHIP.

Oklahoma-Specific Enrollment Numbers:

  • Only 346 people have selected a plan (5% of total applications)
  • 2,412 have been determined to be eligible for Medicaid/CHIP.
  • 6,905 applications have been completed, representing 14,169 people. 
    • 9,952 people are eligible for private health insurance through the marketplace
    • 1,432 people are eligible to enroll in a private plan with federal subsidies.

But Wait, Even Though the President Said  “If You Like Your Plan, You Can Keep It”……

  • Today, RPC released a map of cancellations per state (data not yet available for Oklahoma) which offers a grim snapshot.
  • The RPC map highlights that “for every one person who has selected an Obamacare plan, 40 people have received cancellation notices.”
  • According to RPC’s tally of media coverage, 4.2 million people have received insurance cancellations. 
 Map

(WASHINGTON, D.C.) –U.S. Senator Tom Coburn, M.D. (R-OK) and Congresswoman Barbara Lee (D-CA), along with 38 other lawmakers, sent a letter to President Obama calling on the Administration to announce a doubling of the number of people on treatment through the President’s Emergency Plan for AIDS Relief (PEPFAR) during the Fourth Replenishment of the Global Fund to Fight AIDS, Tuberculosis and Malaria scheduled to take place in Washington, D.C., in December.

“We applaud the Administration’s achievement of increasing the number of people on treatment supported by PEPFAR to 6 million, and the recent announcement of 1 million babies globally born HIV-free thanks to PEPFAR support,” they write.  “To build on this success, we urge you to set a new, bold PEPFAR goal of 12 million people on treatment by the end of fiscal year 2016…. At this critical juncture, scaling up to capitalize on scientific advances, while expanding deployment of proven-effective prevention tools that are already available to us, will not only save millions of lives but will also significantly reduce human suffering, new HIV infections, and healthcare costs in the years to come.”

PEPFAR, a bipartisan program established in 2003, has treated and cared for millions of individuals facing HIV/AIDS, tuberculosis and malaria across the world.

###

Nov 13 2013

BOXER, COBURN PRAISE HOUSE PASSAGE OF THE HOPE ACT

Bipartisan Legislation Would End the Federal Ban on Research into Organ Donations Between HIV-Positive Patients

Washington, D.C. – U.S. Senators Barbara Boxer (D-CA) and Tom Coburn (R-OK) praised the House’s passage of the HOPE Act (HIV Organ Policy Equity Act), legislation that would end the federal ban on research into organ donations from HIV-positive donors to HIV-positive recipients. 

The bipartisan Boxer-Coburn legislation passed the Senate in June. The House legislation – which was sponsored by Representatives Lois Capps (D-CA) and Andy Harris (R-MD) – passed the House today by a voice vote.  The measure now goes to the President for his signature. 

“Ending this outdated research ban is an important step forward that will give hope to thousands of patients and their families,” Senator Boxer said. “This bipartisan legislation has strong support from the medical community and patients’ advocacy groups, who know this research has the potential to save hundreds of lives each year.” 

“For years, arcane federal rules have restricted what could be potentially life-saving organ transplants for HIV-positive individuals.  I applaud the House of Representative for following the Senate’s lead and taking action to lift these rules,” said Senator Coburn. 

“I am incredibly proud to have authored this bill and applaud my colleagues in the House for coming together to pass this common sense, no-cost, bipartisan bill that has the potential to save lives, improve health outcomes, and save taxpayer dollars,” Representative Capps said. “The HOPE Act could open up the door to hundreds more life-saving organ transplants and reduce the organ transplant waiting list for all 100,000 Americans who are on it.” 

“As a physician, I have seen numerous times the life-saving joy that an organ transplant brings to patients and their families,” said Representative Harris. “The HOPE Act changes an outdated law by making government work in a more efficient and effective manner for all patients needing transplants – both those with HIV and those without – which is exactly what the American people expect from their elected officials.” 

The bipartisan measure – also sponsored by Senators Tammy Baldwin (D-WI), Rand Paul (R-KY), Richard Burr (R-NC), Michael Enzi (R-WY), Elizabeth Warren (D-MA), Mark Kirk (R-IL), Dianne Feinstein (D-CA), Mary Landrieu (D-LA), Brian Schatz (D-HI), Richard Blumenthal (D-CT), Roy Blunt (R-MO), Mark Pryor (D-AR) and Carl Levin (D-MI) – would open a pathway to the eventual transplantation of these organs and could provide life-saving assistance to HIV-positive patients who are at risk of liver and kidney failure.

 The ban on the donation of organs from HIV-positive donors and related research was enacted as part of the Organ Transplant Amendments Act of 1988, but is now medically outdated. With the advances in antiretroviral therapy, many HIV-positive patients are living longer lives. These patients are now more likely to face chronic conditions such as liver and kidney failure, for which organ transplants are the standard form of care.

There are currently more than 100,000 patients on the active waiting list for organ transplants in the United States and about 50,000 people are added to the list each year – but fewer than 30,000 transplants are performed annually. Tragically, many patients die while waiting for a transplant.

According to a study published in the American Journal of Transplantation, allowing organ transplants from HIV-positive donors to HIV-positive recipients could increase the organ donation pool by 500-600 donors a year and save hundreds of lives.

This legislation has broad support from the medical community and advocacy groups, including the American Medical Association, American Society of Transplant Surgeons, American Society of Transplantation, Association of Organ Procurement Organizations, American Academy of HIV Medicine, American Society for the Study of Liver Disease, the Human Rights Campaign, National Minority AIDS Council, HIV Medicine Association, National Coalition for LGBT Health, Infectious Diseases Society of America, Gay and Lesbian Medical Association, United Network for Organ Sharing, The AIDS Institute, amfAR (American Foundation for AIDS Research), Lambda Legal, the Treatment Access Group (TAG), and AIDS United. 

###

WASHINGTON, D.C. – Today, U.S. Senators Richard Burr (R-NC), Tom Coburn (R-OK), and Saxby Chambliss (R-GA) reintroduced the Public-Private Employee Retirement Parity Act to address long-term liabilities facing the federal government.  The legislation would end the defined benefit pension portion of the Federal Employee Retirement System (FERS) for new federal government hires starting six months after enactment, leaving fully in place the Thrift Savings Plan with the current match (up to 5%) for both current and future federal workers.  The bill would also apply to Members of Congress. 

“Right now, federal government workers receive far more generous retirement benefits than private sector employees.  The cost to taxpayers of these benefits is unsustainable and we simply cannot afford it,” said Sen. Burr.  “We cannot ask taxpayers to continue to foot the bill for public employee benefits that are far more generous than their own.”

“Generous pension plans for members of Congress have helped turn congressional service into a career rather than a calling,” said Dr. Coburn.   “At the same time, federal workers enjoy a better benefits package and higher overall pay than most taxpayers – even at a time when many Americans are still simply looking for a job.  This status quo is unsustainable and needs to be reformed.”

 

“With America now $17 trillion in debt, we simply cannot continue to commit to future government spending,” said Sen. Chambliss.  “Americans have demanded their leaders make the necessary changes to our fiscal policies to put our nation on a track to sustain economic growth and real job creation.  The Public-Private Employee Retirement Parity Act is a small change that will have a big impact on our debt and deficit.” 

Currently, federal workers enjoy both a defined benefit pension and a Thrift Savings Plan (equivalent to a 401(k)) with up to a 5% match, paid for by the taxpayers.  The average private sector employee gets a 401(k) with a 3% employer match and no pension.  Federal workers also continue to enjoy federal health care benefits (FEHBP) after they retire, a benefit that is becoming increasingly rare in the private sector. 

The legislation will require the Administration to make the annual report on the on the actuarial status of the federal retirement system publically available online by January 31st each year.  According to the most recent Office of Personnel Management’s Civil Service Retirement and Disability Fund annual report, the FERS system is currently underfunded by $20.1 billion for fiscal year 2012.  In the coming years, as more of the retirement burden falls on the FERS system, the required federal government contributions to FERS will skyrocket, especially in comparison to what federal workers will put into the system.  In 2012, the Federal government contributed about $22.2 billion to FERS. By 2065, those required contributions will rise to $239.5 billion, with the government paying out $415.3 billion in benefits. 

Current federal government employees and retirees would not be impacted by the changes in the Burr-Coburn-Chambliss bill.

Click here to learn more.

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Thank you for that kind introduction.  It’s an honor to be with you tonight.

It’s especially an honor to be here because tonight, from the great state of New Hampshire, I am formally announcing my intention to not run for president.  That’s right.  I’m not running for president.  If that isn’t clear, I’m also announcing my decision to not form a presidential exploratory committee.  Not only will I not run for president, I will not form a committee to cloak any ambition I might have with feigned indecision.

But if you’ve followed the news you know I’m not qualified to run for higher office.  I tend to get myself into trouble – not as often as Joe Biden (he was right about Obamacare by the way – it was a big bleeping deal) – but I’ve made my share of mistakes. 

The other reason I’m not going to run for president is I don’t want to give up my post on the Senate Intelligence Committee, which has oversight of the highly-controversial NSA. 

My post gives me a lot of insight into what the other candidates are thinking.  I read their emails on a regular basis, especially the ones they haven’t sent to me.  Here’s a snippet of one exchange:

Ted Cruz told Rand Paul he was upset he was fifth in the latest New Hampshire poll.  So Rand said, “That’s okay Ted.  If you tank in New Hampshire you can run for president anyway … in Canada.  You can take on the Establishment in Ottawa and make them listen to the people of Saskatchewan.  Because, after all, nothing demonstrates listening quite like 21 hours of nonstop talking.” 

Rand was a little tough on Ted.  But Ted wasn’t being fair.  One part of government is very good at listening.  It’s called the NSA. 

But, in all seriousness, isn’t the focus on presidential politics three years from the next election a little bit silly?  Don’t you think so? 

As a party, we need to be investing in ideas, not Iowa. 

In politics, nothing matters more than ideas.  Ideas matter.  Ideas have consequences. 

Look at what’s happening with Obamacare.  It’s a failure not just of a law, but of an idea, and a set of assumptions about government’s ability to solve problems.  No matter how many times this idea has been discredited it always re-emerges, and crawls out of the ash heap of history. 

What we are seeing today is the timeless struggle between freedom and tyranny.  This is the same struggle out of which our nation was born.  At our founding we rejected the idea that the King or the State could micromanage our lives.  Today, we’re seeing the consequences of the idea that the State and the central planners in Washington can control the health care economy for 300 million Americans. 

As we celebrate the 160th anniversary of the founding of the Republican Party in Exeter, you all are familiar with this struggle.  New Hampshire has long been at the front lines of this battle.  You should be very proud of what you’ve done to defend this idea called America.  Now, more than ever, the country needs your wisdom, judgment and discernment as we face the challenges and opportunities ahead. 

I’m optimistic about our prospects because the unraveling of not just Obamacare, but decades of left-wing Big Government ideology is going to give us, as Republicans, a historic opening to make our case to the American people.  

Tonight I want to spend a few minutes talking about what that the case might look like.

I believe there are three things we need to do in order to win.  

First, we need an inspiring vision and purpose.  People need to know what we are for, not just what we oppose.  

Second, we need courageous and principled leadership – leadership that puts political self-interest behind the interest of the nation.  We need a politics of unity, not division.  In politics, it is easy to divide.  Real leadership unites Americans with a common vision and purpose.  

Third, and finally, we need smart strategies and tactics. 

In order to articulate a vision and purpose, we need to reapply the wisdom of our founders to the challenges of today. 

In 1788, Thomas Jefferson said, “The natural progress of things is for liberty to yield, and government to gain ground.” 

That was true in the centuries before Jefferson and it has been true in the two centuries since Jefferson.  The party that aligns itself with that reality – which is the reality of the human condition in a fallen world – will be the party that succeeds in this century. 

What’s brilliant about Jefferson’s statement is it works in reverse.  As government yields, you – We the People – gain ground.  

In the Senate, I’m known as a budget hawk and Dr. No – and sometimes worse names – but my mission has never been just about numbers.  It’s been about freedom and individuals – my grandchildren and yours.  I believe that limited government liberates individuals. 

We also have to understand that while politics is about ideas, it’s also about choices and competition.  On the left, they play to win.  Too often we play to not lose.  And, sometimes, we tackle the wrong team.  

The reality is, the left is more disciplined and often more united.  They approach political battles with a religious devotion I would call progressive fundamentalism.  If you question their dogma they will call you evil and come after you with the IRS.  We shouldn’t respond in kind, but we do need to be equally focused and determined. 

On the right, our goal is to limit government and liberate individuals.  We want to seize power so we can limit power, and set people free.  Our faith isn’t in government but in free individuals and the rights endowed to them by their Creator.  Our agenda is a freedom agenda and a belief that when people are free to make the most of their talents and opportunities we all prosper. 

So, while the left’s big idea is government, our big idea is freedom.  If we’re going to succeed we’re going to have to oppose with all of our strength the relentless assault against individual liberty from Washington, and offer a positive and compelling vision of our own. 

This is a battle we should invite and welcome.  Freedom and liberty are the high ground in the timeless fight about the proper scope of government. 

Our advantage is that our ideas work.  Theirs don’t.  

In every area of our economy we see this principle at work: The best way to make something expensive is for government to make it affordable.  That’s especially true in health care and education.  

Since 1976, education spending has doubled but test scores have stagnated.  We’ve spent $2.4 trillion but we’re not better off. 

In health care, we’ve spent trillions on government programs that produce worse outcomes than the free market.  Plus, one in every three dollars – or $750 billion – doesn’t help anyone get well or prevent them from getting sick.  

And in spite of “investing” hundreds of billions of dollars in so-called economic stimulus, wages for the middle class are less than what they were 1989.   As a columnist for the Washington Post said, “that isn’t a lost decade for economic gains for Americans.  It is a lost generation.” 

So, our first goal is to persistently and persuasively articulate a freedom agenda to counter the left’s government agenda.  The second and third goals are connected.  We desperately need sacrificial leaders who have the wisdom and courage to pursue strategies that serve the country rather than themselves.  We need political leaders who would rather lose an election than lose a generation.  As leaders in this process, those are the people you should elevate.  

As you all know better than most, in politics, it’s very easy to tell people what they want to hear.  It’s much harder to show them the benefits of freedom and then to build a coalition to get them there.  

That’s why I wasn’t a fan of the strategy to shut down the government in order to try to defund Obamacare.  I warned my Senate colleagues months in advance their strategy wouldn’t work.  I told them we didn’t have the power to force the president to defund his signature achievement.  We only had the power to shut down the government.  And I told them that even if we shut down the government we would not shutdown Obamacare – it would still be funded during a government shutdown, and it was.  I also warned that the fight itself would be a divisive distraction, and it was.  We took the nation’s focus off of the disastrous Obamacare launch and shined a spotlight on our own disastrous tactics.  

I want to applaud Senator Ayotte for publicly opposing this strategy.  Her position was the best way to stand for freedom and against Obamacare.  

New Hampshire is lucky to have her in the Senate and it’s an honor to serve with her.  She’s not only brilliant; she has common sense – a rare commodity in Washington – and character.  She has a deep rudder.  She approaches the nation’s business with courage, humility and good judgment.  She’s highly respected by her peers and also doesn’t apologize for being willing to compromise when she can’t get 100 percent of what she wants.  In that sense, she’s a true constitutional conservative.  Our constitution, after all, was a brilliant and principled compromise.  If our nation is going to survive, we can’t be afraid to employ the very form of compromise that created our nation in order to save our nation.  

If the freedom agenda is going to succeed we can’t be divided by strategy and tactics.  Too much is at stake.  Spirited debates are healthy, but political opportunism is not.  Any strategy that begins with the assumption that people like me, Paul Ryan, Scott Walker and Kelly Ayotte are for Obamacare because we opposed a flawed strategy is ludicrous and gives the media the story about infighting they love to write.  Make no mistake. The shutdown was not a battle between the true opponents of Obamacare and the so-called Establishment.  It was a fight between a handful of DC interest groups and a few politicians and the rest of the conservative movement.  It was an episode we should never repeat.  

Fortunately, there are good examples of strategic success to draw from that unifies reform-minded Republicans.  

The first example is earmarks.  A few years ago members of Congress, including far too many Republicans, were spending billions of dollars and an inordinate amount of time chasing earmarks – special projects for their districts and states.  As recently as 2010, members of Congress requested nearly 40,000 earmarks estimated to cost $131 billion.  At that time, I had been fighting against earmarks – which I called the gateway drug to Congress’ spending addiction – for more than a decade.  I was told I would never succeed and I was tilting at windmills.  But guess what?  Thanks to an outpouring of voter disgust and smart tactics we won.  The windmill fell over.  We’re now living under an earmark ban and the number of earmarks has gone from 16,000 a year to almost zero.

Tactically, we did a few things correctly.  First, we picked our targets wisely and understood that in any struggle, victory is usually gradual and incremental.  In World War II, for instance, our generals didn’t invade Japan.  Instead, they used an island hopping strategy.  In Europe, we didn’t mount a paratroop drop over Berlin.  Instead, we secured a beachhead at Normandy. 

On earmarks, we didn’t promise to defund or end earmarks at once. Instead, we picked vulnerable targets like the Bridge to Nowhere in Alaska that represented Washington’s excess.  Even though we lost a 2005 vote to defund the Bridge to Nowhere in the Senate by 82-15, we won the argument decisively in the public square.    

Second, we used persuasion and facts with our colleagues rather than demagoguery and deception.  We didn’t attack individual politicians – we attacked projects.  We persuaded our colleagues that earmarks weren’t consistent with our values as public servants, and weren’t consistent with an agenda that promotes freedom and liberty.  

Again, for me, that fight wasn’t about numbers.  It was people and their freedom.  As Republicans we should reject the notion that politicians know best where to spend taxpayer funds, regardless of which party they represent.  It’s simple.  We don’t know best.  You know best.  The effective legislator isn’t the one who sends money back to the state; it’s the one who keeps money from leaving the state, and the pockets of free people. 

The fight also wasn’t just about getting rid of earmarks – the gateway drug – it was about limiting government in other areas as well.  I would argue getting rid of earmarks led to another success story.  

After the 2010 elections, conservatives demanded spending cuts in exchange for a debt limit increase.  We made a simple and clear argument that it was foolish to simply increase the debt limit without dealing with the underlying problem of overspending.  We won that debate.  Even though the Budget Control Act gave us sequestration – we should be making targeted, not across-the-board cuts – we have cut spending two years in a row for the first time since the end of the Korean War. 

The end of earmarks and the spending caps are two great success stories and unlikely reversals in the course of government.  We didn’t just talk about cutting spending.  We did it.  We made government yield and allowed freedom to reclaim a little more of its rightful place in our society. 

The challenge before us now is to keep on winning by picking the right targets, and by having a positive vision that restores confidence in our country.

Fortunately, there are a lot of islands to take, and poorly-defended hills to conquer.  On spending, we’ve barely scratched the surface.  My office has been waging a permanent campaign against Big Government since I came to the Senate.  We’ve found more than $250 billion in annual duplication, waste and mismanagement.  

I could spend an hour detailing waste alone.  But here are few examples:

  • We waste $3 billion on duplicative data centers.  I just introduced a bill with Senator Ayotte to close and consolidate 40 percent of these centers. 
  • We spend $30 billion a year for more than 47 job training programs, administered by nine different federal agencies across the federal bureaucracy. 
  • Meanwhile, we provide unemployment benefits for millionaires. 
  • We spend $30 million for 15 financial literacy programs at 15 different agencies.  Since when was the federal government qualified to teach anyone about financial literacy?  
  • We also spend $3 billion on 209 Science, Technology, Engineering, and Math programs at 13 different federal agencies and have done so for years.  
  • And we even spent $325,000 to help the National Science Foundation see how a rattlesnake responds to robotic squirrels. 

If you want to know more – and become permanently depressed – I would encourage to go to my website www.coburn.senate.gov and read through the 35 oversight reports my office has produced, all of which are an indictment against the idea that Washington can fix our problems, or can spend money wisely, and with common sense.  

Our spending decisions remind me of a great line from Will Rogers – a famous Oklahoman: “I don’t tell jokes.  I just watch the government and report the facts.”  

On that note, stay tuned later this year for another edition of my annual “Wastebook” report that will document this year’s idiocy from Washington.  

The point is, as Republicans, making the case for smart spending cuts in the discretionary budget should be easy.  But we also need to be making the case for entitlement reform.  Doing nothing to fix our safety net programs, which is the default position of the left, is the worst possible option for the people who rely on these services.  When it comes to entitlements, the progressive fundamentalists are not just anti-reform but anti-math.  They cling to a superstitious belief that these programs, which are going bankrupt, will fix themselves and they continue to demagogue and demonize anyone who questions their dogma. 

Fortunately, some Democrats are willing to listen to reason and break with the extreme, anti-reform elements of the left.  

I recently released a report with Democratic Carl Levin documenting fraud in the Social Security disability system, which was featured on 60 Minutes.  Social Security Disability could be bankrupt by 2016.  That means millions of truly disabled Americans will face benefit cuts or middle-income Americans will face an increase in their payroll taxes.  As Republicans we should be leading the charge for reform and siding with the millions of Americans who will be hurt by the indifference and ideological rigidity of the left.    

Medicare and Medicaid are equally wasteful on a much larger scale.  We throw away between $60-100 billion a year on waste and fraud in these programs. Both of these programs are also going bankrupt and often produce worse outcomes than the private sector.  The best reform ideas are on the Republican side of the aisle. 

Obamacare is the fourth largest entitlement program, but the administration’s campaign of mass deception gives us a historic opportunity to compete and gain ground in the battle of ideas.  

When Obamacare was being debated in the Senate I was vilified for warning that patients would die sooner because of the law even though, in my own practice, I had seen real-life cases of patients who would have gone undiagnosed and untreated had Obamacare been in effect.  I also warned that the entire law was designed to destroy the private health insurance market and herd everyone into government-run health care.  

Guess what?  It turns out for many if you like your plan and your doctor you can’t keep them, even though the law was sold on that promise.  The Wall Street Journal recently published a column from a patient with stage-4 gallbladder cancer named Edie Littlefield Sundby, who is having her health insurance cancelled.  Her case has become a rallying point for the millions of Americans who are about to lose their health insurance because their plans aren’t good enough according to bureaucrats in Washington who often have zero real world experience in health care.  

Meanwhile, millions of others are going to see their premiums skyrocket because there is no incentive for young, healthy people to enroll.  It’s basic math.  If young and healthy people don’t enroll and offset the costs of older, sicker people the system collapses, which was the design.  Even Harry Reid admitted that Obamacare was designed to transition the nation single payer government-run health care.  

Thomas Jefferson would understand our predicament well.  He and many of our founders devoted themselves to creating safeguards against tyranny.  As Jefferson said, “I have sworn upon the altar of God, eternal hostility against every form of tyranny over the mind of man.” 

The tyranny today is the fervor of progressive fundamentalism and its misplaced faith in government.  Like our founders, we need to be equally vigilant, and smart, about opposing tyranny in our time.  

I believe the tyranny we’re seeing in Washington can be reversed.  History tells us republics don’t last and they collapse over loose fiscal policy, but I believe we can cheat history.  What we are seeing with Obamacare, and across the federal government, are the consequences of putting too much faith in government and too little faith in freedom.  People want an alternative.  They’re ready.  They want real change and real hope.  Millions of Americans know, like never before, that the compassion of the left is counterfeit.  

I know from my own life – and I suspect you all do as well – that the ideas I’ve talked about tonight are not mere abstractions.  They can be the difference between having a job and not having a job, and even life and death. 

As some of you may know I was recently diagnosed with a recurrence of prostate cancer.  This is the fourth time I’ve been diagnosed with cancer and I expect to beat this one as well.  But, the truth is, I’m here not because of my own strength but by the grace of God, the power of prayer, and also the power of freedom and innovation that is unleashed when a society allows free people to use their creativity and God-given talents to produce miraculous cures and treatments.

The answer to our challenges is not going to be found in legislatures but labs.  And as the wise first lady Barbara Bush once said, the wisdom to correct our course isn’t going to come from the White House, but your house.  As Republicans, this is what we should be about – describing the material and immaterial wealth that is produced when free people are allowed to meet local challenges in the context of loving families and their communities.  I think of people in my own state like Jason Price who developed a program to honor the dignity of disabled Oklahomans by getting 650 people off of disability and into productive jobs.  We need to celebrate these examples and talk about what Arthur Brooks describes as “the happiness that comes from earned success” and contrast that vision with the limited potential that comes from learned dependency. 

As Republicans, we have the ideas and solutions to confront and overcome the tyranny of Big Government.  Our agenda should begin with freedom and end with acts of sacrificial leadership that puts results ahead of rhetoric.  This is a fight we can, and must, win.  It’s time for government yield and for freedom to gain ground.  

Thank you, God bless you, and may God continue to bless this great idea called America.

Fact #1:  Because of Scoring Guidelines, CBO Does Not “Score” Program Integrity Provisions as Saving Money. 

An analyst from the nonpartisan Congressional Research Service has explained that, with regard to program integrity initiatives, at least one of two scorekeeping guidelines apply, depending on whether the program integrity initiatives are funded as discretionary spending or direct spending (i.e., mandatory spending): rule #3 and rule #14.  These rules, from the “Scorekeeping Guidelines” published in the Joint Explanatory Statement of the Committee of Conference on H.R. 2015 (105th Congress), are used to measure compliance with congressional and statutory budget rules.[1] 

“3. DIRECT SPENDING PROGRAMS

Entitlements and other mandatory programs (including offsetting receipts) will be scored at current law levels as defined in section 257 of GRH, unless Congressional action modifies the authorization legislation. Substantive changes to or restrictions on entitlement law or other mandatory spending law in appropriations laws will be scored against the Appropriations Committee section 302(b) allocations in the House and the Senate. For the purpose of CBA scoring, direct spending savings that are included in both an appropriation bill and a reconciliation bill will be scored to the reconciliation bill and not to the appropriation bill. For scoring under sections 251 or 252 of GRH, such provisions will be scored to the first bill enacted.

 

14. SCORING OF RECEIPT INCREASES OR DIRECT SPENDING REDUCTIONS FOR ADDITIONAL ADMINISTRATION OR PROGRAM MANAGEMENT EXPENSES

No increase in receipts or decrease in direct spending will be scored as a result of provisions of a law that provides direct spending for administration or program management activities.” 

These rules effectively mean that, unless Congress changes the basic nature of the Medicaid and Medicare programs as an entitlement – or changes the scoring rules themselves – CBO is not allowed, for scorekeeping purposes, to assign savings to most program integrity provisions.

Fact #2: Because of Fact #1, CBO Assumes That CMS Uses Its Program Integrity Funding in the Most Efficient and Most Effective Manner.

Despite a wealth of analysis from GAO reports and Inspector General reports showing gaps, failures, and limitations in CMS’s administration of program integrity initiatives, according to conversations with CBO staff, CBO said they assume CMS uses its program integrity funding in the most effective manner.  This assumption is understandable given the restrictions of the scoring conventions CBO must uphold, but it f clearly is a scoring convention that does not necessarily reflect real-world experience and an abundance of data to the contrary. Assessing this assumption critically, one downside of CBO assuming CMS is doing a top job under current law is that this assumption is biased toward the status quo and does not take into account the relevant merits of specific policies. 

Fact #3:  While Scorekeeping Guidelines Prevent CBO From Include Savings In Its Official Score For Scorekeeping Purposes, CBO Does Estimate That Program Integrity Initiatives Provisions Do Save Money.

In its August 1 estimate of the Budget Control Act of 2011, CBO explained that increasing the budget caps (and thus appropriations) to the Health Care Fraud and Abuse Control fund would result in real savings to the program, even though those savings are not scorable under the convention of the budget rules.   CBO said: “If the Congress were to appropriate the maximum amounts eligible for the cap adjustment related to HCFAC, spending for such activities would be about $3 billion above CBO’s baseline. Based on that increase, CBO estimates that benefit outlays for Medicare, Medicaid, and CHIP would fall by about $3.7 billion over the 2012-2021 period. Additional savings would accrue after 2021.” In Table 2 of the same document, CBO shows a $2.9 billion increase in HCFAC funding results in a -$3.7 billion “Non-Scorable Effects on Direct Spending Outlays” – or in other words, $3.7 billion (roughly $800 million net) in real savings for taxpayers that do not count under budget rules.



[1] The House Budget Committee compendium titles these guidelines as that of CBO and OMB, but CRS notes they  actually apply to all “scorekeepers,” including both Budget Committees.  

Document available here. 

Nov 06 2013

Senate Homeland Security and Governmental Affairs Committee Advances Bipartisan Bill to Consolidate Federal IT Infrastructure, Save Taxpayer Dollars

HSGAC Chairman Carper Signs on as Cosponsor for Waste Reducing, Energy Saving Measure

Washington, DC – The Senate Homeland Security and Governmental Affairs Committee (HSGAC) today  advanced The Federal Data Center Consolidation Act of 2013, S. 1611, a bill to help reduce waste and government inefficiency by consolidating the total number of federal data centers, and making those data centers more efficient. HSGAC Chairman Tom Carper (D-DE) joined the effort as a cosponsor of the bill introduced last week by Senator Michael Bennet (D-CO), and cosponsored by Senators Tom Coburn (R-OK) and Kelly Ayotte (R-NH). 

Because federal agencies have been slow to act on consolidation initiatives, the bill sets hard deadlines and requires agencies to conduct inventories and implement consolidation strategies.  Numerous studies have shown a relatively low utilization rate of the current infrastructure, resulting in an enormous amount of wasted space and energy – and incurring unnecessary costs. 

“This is a common sense way that we can reduce unnecessary waste, save taxpayer dollars, and ensure that our federal agencies are being held accountable. It will also help cut energy consumption at these data centers,” Bennet said. “Making it through committee is an important step forward for this bill, and we welcome Chairman Carper on as a cosponsor.”

“I’m proud my committee colleagues, as well as Senator Bennet from Colorado, have moved legislation forward to support OMB’s own goals to consolidate duplicative data centers and save taxpayers up to $3 billion,” Dr. Coburn said. 

“The Administration’s Federal Data Center Consolidation Initiative is an ambitious challenge that is worth meeting. While evidence shows a major shift in the way the federal government thinks about and pursues IT management in its operations, it’s clear that some agencies have more work to do,” Chairman Carper said. “We need to salute the success stories and push those agencies that have fallen short to work harder. This measure builds off of the Administration’s efforts and will help agencies focus their efforts on consolidation, better manage their inventories, and ensure that the Consolidation Initiative is seen through to its conclusion. I want to thank Senators Coburn, Bennet, and Ayotte for their work on this important issue. The American people and our budget situation demand robust results, and this legislation is an important part of that effort.”

“With over $17 trillion in debt, there’s no excuse to continue to spend millions on wasteful and unnecessary federal data centers – some of which are utilizing only 5 percent of their capacity,” said Ayotte. “Our bipartisan legislation is a common sense measure that will save taxpayer dollars by speeding up consolidation and increasing the efficiency of data centers across government, and I hope the Senate will act quickly to pass this bill.”

In 2010, the Office of Management and Budget (OMB) instructed federal agencies to develop consolidation plans under the administration’s Federal Data Center Consolidation Initiative (FDCCI), which could save up to $3 billion by 2015, according to the Government Accountability Office (GAO), with additional savings beyond that date. However, GAO also found that a number of agencies have been slow to implement these plans – or, in some cases, to even inventory the total number of data centers they currently manage. Under the FDCCI, the federal government set a goal of shutting down at least 1,200 of the over 3,000 known data centers it owns and operates.

The cost just to pay for the electricity to operate federal servers and data centers across the government is about $450 million annually. According to the Department of Energy, data center spaces can consume 100 to 200 times more electricity than a standard office space.  This bipartisan legislation would help support OMB’s government-wide effort to bring down these costs and conserve energy at the same time.

This bill would require participating federal agencies to submit complete data center inventories and a consolidation strategy, which must include a timeline for implementation and cost-savings estimates.  The legislation includes hard deadlines, and participating agencies must also submit annual updates on their progress for the next five years.  In addition, the law would require the GAO to verify agency data center inventories, and would direct OMB to routinely report to Congress on cost savings realized to date. 

The GAO has publicly endorsed the legislation, saying it is necessary to ensure that agencies close down unnecessary data centers by the target deadline. The senators have worked closely with OMB and GAO to ensure that this legislation will help strengthen the initiative and achieve meaningful savings.

The bill is also supported by the Professional Services Council and the Information Technology Industry Council

Senators Bennet and Coburn originally filed this legislation as an amendment to the Energy Savings and Industrial Competitiveness Act of 2013 (S.1392).

# # #

Nov 05 2013

HATCH, COBURN WARN OF POTENTIAL OBAMACARE SUBSIDY FRAUD; CITE PROBLEMS WITH EARNED INCOME TAX CREDITS

In Letter To IRS Principal Deputy Commissioner Werfel, Senators Ask How Agency Will Combat Improper Payments Of Health Law’s Premium Tax Credits

WASHINGTON – On the heels of a new Treasury Inspector General for Tax Administration (TIGTA) report that found the Internal Revenue Service (IRS) has failed to reduce improper Earned Income Tax Credit (EITC) payments, Finance Committee Ranking Member Orrin Hatch (R-Utah) and Homeland Security and Governmental Affairs Ranking Member Tom Coburn (R-Okla.) today pressed the IRS for additional answers on how the agency will manage ObamaCare’s premium subsidies, complex tax credits designed to defray the cost of purchasing health insurance, based on household income.

In a letter to Principal Deputy Commissioner Daniel Werfel, the Senators questioned whether the IRS was equipped to process the subsidies which are both advanceable and refundable – meaning pay out first and verify later – and asked for details on the policies that are in place to curb improper payments to taxpayers.

“This [TIGTA] audit raises serious concerns about the IRS’s unwillingness or inability to successfully prevent billions of taxpayer dollars being wasted on erroneous tax credit claims.  We are particularly worried about these findings, given the IRS’s role generally as the primary agency administering a range of credits and specifically in overseeing and implementing the premium tax credits under the Patient Protection and Affordable Care Act (PPACA),” wrote the Senators.  “Similar to the EITC, the Affordable Care Act offers refundable tax credits for certain eligible individuals.  However, we believe that a range of provisions in federal law, regulations, and administrative practices actually leave the health care overhaul even more seriously susceptible to fraud or abuse than the EITC program already is.”

 

The text of the letter to Principal Deputy Commissioner Werfel is below and a signed copy can be found HERE:

 

Daniel Werfel

Principal Deputy Commissioner

Internal Revenue Service

1111 Constitution Avenue, NW

Washington, D.C. 20230

 

Dear Principal Deputy Commissioner Werfel: 

Recently, the Treasury Inspector General for Tax Administration (TIGTA) reported that the Internal Revenue Service (IRS) has “made little improvement in reducing the improper payment rate for the Earned Income Tax Credit (EITC) since being required to report estimates of these payments to Congress.”[1] In 2012, the IRS allowed about $13.6 billion in improper EITC payments to tax filers who were ineligible for the credit.  Unfortunately, that means that up to 25 percent of EITC last year payments were improper

Back in 2008, TIGTA recommended that IRS come up with alternative methods for identifying and preventing improper payments. However, TIGTA’s recent audit revealed that IRS has not taken any steps to address this recommendation.[2]  In fact, TIGTA found that IRS does not even have a goal for reducing future improper payments, or a plan in place to meet such targets.[3]  The IRS’s failure to take recommended steps to increase program integrity means the program continues to be at risk.  In 2011, up to $16.7 billion in tax credits were issued improperly, and in 2010, the amount was roughly the same—$18.4 billion. 

This audit raises serious concerns about the IRS’s unwillingness or inability to successfully prevent billions of taxpayer dollars being wasted on erroneous tax credit claims.  We are particularly worried about these findings, given the IRS’s role generally as the primary agency administering a range of credits and specifically in overseeing and implementing the premium tax credits under the Patient Protection and Affordable Care Act (PPACA). 

Similar to the EITC, the Affordable Care Act offers refundable tax credits for certain eligible individuals.  However, we believe that a range of provisions in federal law, regulations, and administrative practices actually leave the health care overhaul even more seriously susceptible to fraud or abuse than the EITC program already is. 

First, to try to prevent improper payments for federally-facilitated exchanges, IRS will rely partly on personal attestations of income, and only audit a random sample of applicants who claim that their income decreased more than 10 percent from amounts found in last year’s tax filing starting in 2014.[4] State-based exchanges will not be required to perform this audit until 2015.

Second, because of a change the Obama administration made this past summer, premium credit applicants in state-based exchanges can simply provide a personal attestation that they do not receive qualifying insurance through their employer to receive their premium credits in 2014. No further documentation is required.[5]

Third, a provision in current law actually limits how much the federal government can recover from sending a greater amount of subsidy to consumers than for which they were eligible.[6] In other words, the law currently prevents the recovery of overpayments paid to individuals who turn out not to be eligible for them.   This cap on recovering overpayments will prevent federal officials from pursuing billions of dollars in overpayments. In fact, according to CBO, if that cap on recapturing subsidy overpayments were eliminated, taxpayers would save $43 billion over a decade.[7]

Finally, the concerns lie not just with the EITC, but with other tax requirements as well. A more recent TIGTA report found that even some of the standard income and withholding verification processes at the IRS may be failing to prevent fraudulent tax refunds.[8] As the IRS watchdog explained, “most current year third?party information is not available until well after the tax return filing season begins and tax returns are processed,” and, as a result, a 2012 audit shows that nearly 1.5 million tax returns “were not detected by the IRS as potentially fraudulent despite having the same characteristics as IRS-confirmed identity theft fraudulent tax returns.” 

Overall, taken together, these realities paint a worrisome picture of the fraud that may be anticipated under PPACA. The premium tax credits vulnerability to fraud and abuse is significant because the Congressional Budget Office estimates that the credits cost taxpayers $796 billion over the coming decade.[9]  If these health coverage premium tax credits experience an improper payment rate similar to that of the EITC, about $200 billion taxpayer dollars could be wasted or lost to fraud. Therefore, to better understand how IRS will manage the potential for significant fraud and abuse in applications for PPACA premium tax credits, we respectfully ask for responses to the following questions.

  1. What is IRS’s plan to avoid improper payments made to applicants for premium tax credits, and how will IRS recover such improper payments?
  2. To what extent is IRS planning to identify or implement alternative compliance methods to avoid or recoup improper premium tax credits, similar to TIGTA’s 2008 recommendation regarding EITC?
  3. Given the history of high improper payments for EITC, what assurances can you provide that premium tax credits will not result in the same rate of fraud and abuse?
  4. What lessons have you learned from addressing EITC improper payments that could be applied to implementing the ACA?
  5. What are IRS’s 2014 targets for premium tax credit improper payments? 

Please provide your response no later than November 25, 2013. 

Sincerely,

 

HATCH
COBURN

 

###


[2] Page 12 of the report.

[3] Page 13 of the report.

[5] CRS report # R43150, page 10 of the PDF.

[6] Citation: P.L. 112-9, Sec. 4 amends sec 36B(f)(2)(B) of the Internal Revenue Code.

[9] U.S. Congressional Budget Office, “CBO’s May 2013 Estimate of the Effects of the Affordable Care Act on Health

Insurance Coverage,” May 2013, http://www.cbo.gov/sites/default/files/cbofiles/attachments/

44190_EffectsAffordableCareActHealthInsuranceCoverage_2.pdf.

(WASHINGTON, D.C.) – Today, U.S. Senators Tom Coburn, M.D. (R-OK), Richard Burr (R-NC), and Mike Enzi (R-WY), commented on a new Government Accountability Office (GAO) report they requested that warns the Obama Administration is failing to provide Congress and the public with timely, meaningful analysis of likely future shortages of health care providers.  The report, HRSA Action Needed to Publish Timely National Supply and Demand Projections, warns that the national supply and demand projections for the health care workforce are currently based on information that is more than a decade old. 

“Today’s GAO report builds on an unfortunate theme,” Dr. Coburn said.  “The federal government simply has no comprehensive federal health care workforce strategy.  We have no strategy that targets precious taxpayer dollars and no strategy to strategically align workforce programs so that providers in the training pipeline are prepared to serve the patients of tomorrow.  It is inexcusable that, at a time when we are facing serious projected shortages of physicians and nurses in many areas, four federal departments are running 91 programs without any coherent strategy. I look forward to working with my colleagues to change that.” 

“This GAO report is deeply troubling for the future of our nation’s health care workforce,” Senator Burr said.  “At a time when federal funds are extremely scarce and we face potentially significant shortages of quality doctors, nurses, and other health care providers, we need a cohesive strategy based on accurate information to ensure a robust provider pipeline.  I look forward to working with my colleagues on behalf of patients and taxpayer’s to ensure that dollars are being wisely spent to adequately train medical professionals for the future.” 

“This Administration wants government to be in charge of your health care, but it can’t even coordinate efficiently enough to give realistic projections on what our future health care workforce needs may be,” said Sen. Enzi.  “Health Resources and Services Administration’s reliance on out-of-date data and failure to adjust agency priorities to address actual workforce shortages threatens to reduce access to care and exacerbate shortages in the future. I thank Senators Coburn and Burr for their leadership on this issue.” 

Senators Coburn, Burr, and Enzi sent a letter to Health Resources and Services Administration (HRSA) Director Mary Wakefield expressing their concern regarding the findings of the GAO report.  In the letter, the Senators write, “GAO’s findings of HRSA’s disappointing performance are concerning, not only because of the taxpayer dollars potentially being wasted, but because we already face likely health care provider shortages in our country,” 

Key Findings:

  • HRSA within the U.S. Department of Health and Human Services (HHS) is responsible for monitoring health care workforce adequacy. To carry out its mission, HRSA conducts and contracts for health care workforce studies. As GAO report explained, “for over a decade, government, academic, and health professional organizations have projected national shortages of health care professionals, which could adversely affect patients’ access to care.”  For example, the Association of American Medical Colleges has projected that “the United States faces a shortage of more than 90,000 physicians by 2020—a number than will grow to more than 130,000 by 2025.”
  • GAO’s report found that, despite spending millions of taxpayer dollars to issue contracts since 2008, under the Administration, HRSA has failed to update national supply and demand projections for the health care workforce. In fact, HRSA has missed multiple internal deadlines for issuing reports projecting the supply of and demand for various health care professionals. HRSA officials attributed the delay in publishing this report to data challenges and modeling limitations, though they did admit there are no written procedures for preparing a report for publication, which GAO says may impede the ability to deliver timely analysis. 
  • The analysis by GAO also reveals the lack of timely and meaningful analysis even fails to meet HRSA’s own standards, since reports may be outdated before they even become public.  As GAO explains, “HRSA itself has stated that physician workforce projections should be completed at least 10 years in advance to provide enough time for policy interventions to influence the size and composition of the workforce.”  However, in the case of one “report containing projections to 2020, review has been ongoing for 3 years,” which means that, “if this report were published in 2013, it would project only 7 years into the future.”
  • GAO warned that if the projected shortages in the health care workforce materialize, this “could result in delays in getting care, or patients not receiving needed care.” Accordingly, GAO explained that, “in the absence of published projections, policymakers are denied the opportunity to use timely information from HRSA to inform their decisions on where to direct billions of dollars in training funds.” A previous GAO report issued at the request of Senators Coburn, Burr, and Enzi, found that four federal departments administered 91 programs in FY 2012 that supported postsecondary training or education specifically for direct care health professionals at a cost to taxpayers of $14.2 billion.

Supporting Documents

•           The GAO report is available online here.
•           A summary of the key findings from GAO’s report is available here.
•           Letter to HRSA Director Wakefield is available here.
 

###

October 2013

Oct 31 2013

Bennet, Coburn, Ayotte Introduce Bill to Consolidate Federal IT Infrastructure and Reduce Waste

Bipartisan Bill Could Result in Up to $3 Billion in Savings

Washington, DC – Senators Michael Bennet (D-CO), Tom Coburn (R-OK), and Kelly Ayotte (R-NH) introduced a bill to help reduce government inefficiency by consolidating the total number of federal data centers, and making those data centers more efficient.  Because federal agencies have been slow to act on consolidation initiatives, the bill sets hard deadlines and requires agencies to conduct inventories and implement consolidation strategies.  Numerous studies have shown a relatively low utilization rate of the current infrastructure, resulting in an enormous amount of wasted space and energy – and incurring unnecessary costs. 

In 2010, the Office of Management and Budget (OMB) instructed federal agencies to develop consolidation plans under the administration’s Federal Data Center Consolidation Initiative (FDCCI), which could save up to $3 billion by 2015, according to the Government Accountability Office (GAO), with additional savings beyond that date. However, GAO also found that a number of agencies have been slow to implement these plans – or, in some cases, to even inventory the total number of data centers they currently manage. Under the FDCCI, the federal government set a goal of shutting down at least 1,200 of the over 3,000 known data centers it owns and operates. 

“At a time when we are facing tough choices to cut spending and lower the deficit, this is a commonsense proposal that will help the federal government save billions in taxpayer dollars while also conserving energy,” Bennet said. “We already know that this plan is a simple way to reduce inefficiency and it ensures that federal agencies are taking action to identify and shut down unnecessary centers.” 

“Across the federal government, duplication, overlap and mismanagement costs taxpayers at least $250 billion every year. The way to solve that problem is one program and one area at a time,” Dr. Coburn said. “I’m proud to join my colleagues in offering legislation that will consolidate duplicative data centers and help save taxpayers up to $3 billion.” 

“With over $17 trillion in debt, there’s no excuse to continue to spend millions on wasteful and unnecessary federal data centers – some of which are utilizing only 5 percent of their capacity,” said Ayotte.  “Our bipartisan legislation is a common sense measure that will save taxpayer dollars by speeding up consolidation and increasing the efficiency of data centers across government.”

The cost just to pay for the electricity to operate federal servers and data centers across the government is about $450 million annually. According to the Department of Energy, data center spaces can consume 100 to 200 times more electricity than a standard office space.  This bipartisan legislation would help support OMB’s government-wide effort to bring down these costs and conserve energy at the same time. 

This bill would require participating federal agencies to submit complete data center inventories and a consolidation strategy, which must include a timeline for implementation and cost-savings estimates.  The legislation includes hard deadlines, and participating agencies must also submit annual updates on their progress for the next five years.  In addition, the law would require the GAO to verify agency data center inventories, and would direct OMB to routinely report to Congress on cost savings realized to date. 

The GAO has publicly endorsed the legislation, saying it is necessary to ensure that agencies close down unnecessary data centers by the target deadline. The senators have worked closely with OMB and GAO to ensure that this legislation will help strengthen the initiative and achieve meaningful savings.

The senators originally filed this legislation as an amendment to the Energy Savings and Industrial Competitiveness Act of 2013 (S.1392).

# # #

Oct 31 2013

Senators Highlight New GAO Report on Security Clearances

Clearances Given to Federal Employees and Contractors Who Owe Backed Taxes

(WASHINGTON, D.C.) – Today, Ranking Member of the Senate Homeland Security and Governmental Affairs Committee Tom Coburn, M.D. (R-OK), Ranking Member of the Senate Finance Committee Orrin Hatch (R-UT), and Senator Susan Collins (R-ME) highlighted a new report from the Government Accountability Office (GAO) entitled, “Security Clearances: Additional Mechanisms May Aid Federal Tax-Debt Detection.”  In the report, GAO found that 8,400 individuals adjudicated as eligible for a clearance were found to owe $85 million in unpaid federal taxes as of June 2012.  

“Giving security clearances to individuals that fail to follow the law is unwise and unnecessarily puts our nation’s classified information at risk,” Dr. Coburn said.  “Prudent precautions must be taken to eliminate potential threats that could compromise the integrity of federal workforce and the privileged information they safeguard.  Federal tax cheats with security clearances are double threats that jeopardize both our national and economic security.  Because of this, it is imperative the Administration and Congress quickly take action to eliminate this egregious, and preventable, practice.  Doing so will not only enhance our security, but will also encourage federal employees to live by the same rules and pay their share of taxes.”

"All federal employees from the highest positions in the President's Cabinet to IRS employees have an obligation to abide by the law and pay their taxes - just like every other American,” Senator Hatch said.  “Unfortunately, as this report demonstrates, there are too many bad actors who don't disclose having a tax debt exposing themselves to bribery and blackmail. Given the positions they hold and the influence they wield, those earning a paycheck from Uncle Sam need to live up to the highest standard - not just because it's the law, which is of course tantamount, but also to ensure their official responsibilities aren't jeopardized. I hope the Administration views this report as an opportunity to fix this problem." 

“This GAO report is further evidence of the weaknesses in our security clearance process,” Senator Collins said.  “That is why I have introduced bipartisan legislation along with Senators McCaskill, Ayotte, and Heitkamp that would direct OPM to institute at least two audits of every security clearance at random times during each five-year period the clearance is active.  Any red flags raised will then be reported back to the employing agency to determine if a re-investigation of the clearance is needed.   Unpaid taxes are an indicator of financial trouble and may indicate in some cases that the employee could be susceptible to a bribe.  This type of information must be monitored to help prevent future incidents such as we have recently experienced.” 

According to the report, approximately 4.9 million employees and contractors have a security clearance.  GAO conducted its analysis between April 2006 and December 31, 2011. During that time, approximately 240,000 received a clearance.  Of the 240,000 that received a clearance, GAO found that 8,400 individuals adjudicated as eligible for a clearance were found to owe $85 million in unpaid federal taxes as of June 2012, representing about 3.4 percent of the civilian executive branch employees and contractors who were favorably adjudicated during this timeframe.  GAO did not include employees and contractors from the Department of Defense in its analysis. 

Key findings include:

  • Of the 8,400 individuals found to owe backed taxes, half (4,200) had a repayment plan with the IRS to pay back their debt.  These individuals with repayment plans owed approximately $35 million (meaning the other half that did not have a repayment plan owed $50 million).
  • Of the 8,400 individuals, 4,700 were federal employees and 3,700 were contractors.
  • Of the 8,400 individuals, 4,200 were given a top-secret clearance.
  • Approximately 76 percent (6,300 individuals) accrued tax debts onlyafter the issuance of the security clearance.
  • About 16 percent of the $85 million in unpaid taxes were delinquent more than 3 years, and approximately 6 percent of the unpaid federal taxes were delinquent more than 5 years.
  • The unpaid taxes of each individual varied from approximately $100 to over $2 million, and the median tax-debt amount owed was $3,800.
  • Because OPM’s systems do not maintain information on the denial of security clearances on the basis of an individual’s nonpayment of federal taxes, it is unknown how many individuals were denied a clearance for having unpaid federal taxes.

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(WASHINGTON, D.C.) – Today, Ranking Member of the Senate Homeland Security and Governmental Affairs Committee Tom Coburn, M.D. (R-OK) highlighted two new reports from the Department of Health and Human Services Office of Inspector General that show Medicare paid millions to dead doctors, dead beneficiaries, undocumented workers and illegal aliens.  The reports show Medicare wasted $23 million in care on the deceased in 2011, $25 million on dead doctors between 2009-2011, and $29 million for prescription drugs to more than 4,000 unlawfully present beneficiaries between 2009-2011.  

“Awarding benefits to the deceased is dead wrong,” Dr. Coburn said.  “I am particularly concerned about this latest development because, despite being notified of this problem five years ago, the administration continues to pay dead doctors.  Every individual wrongfully awarded benefits, be it the deceased or undocumented, diverts scarce resources away from those who need it most.  That is why Chairman Carper and I introduced the Improper Payments Agency Cooperation Enhancements Act, which enhances coordination between agencies with anti-fraud and waste mechanisms that will curtail this egregious practice.  Congress should pass this bill without delay. At the same time, the administration must take action to work with all agencies to ensure those who do not qualify for benefits do not receive them.” 

Key findings include: 

Medicare Wrongly Paid $29 Million in Drug Costs for 4,000 People Illegally in U.S.

Under federal law, health care benefits are not allowed to be paid for services provided to unlawfully present beneficiaries.  However, a new report from the Inspector General of the U.S. Department of Health and Human Services finds that the Medicare program wrongly paid drug costs totaling $29 million on behalf of 4,139 unlawfully present individuals.  Medicare program officials have said they will correct the problem, but have not given a timeframe for implementing needed corrective actions, nor have they agreed to recoup monies lost during this year and last year for the same reason. 

Medicare Wrongly Paid $23 Million for Dead Patients in 2011 

Under federal rules, Medicare claims for health care benefits are not supposed to be paid for dead people who were enrolled in Medicare beneficiaries. However, a new report from the Inspector General of the U.S. Department of Health and Human Services finds that the Medicare program wrongly paid $23 million in 2011 for services after a Medicare patient was already dead. These dollars represent a preventable waste of taxpayer dollars and have a harmful effect on an already cash-strapped program cumulative effect year over year. Medicare program officials have said they will correct the problem, but have not given a timeframe for implementing needed corrective actions. Moreover, despite ongoing Congressional oversight and concerns about the program’s integrity, Medicare officials clearly failed to take proactive preventative steps in this area.

Medicare Wrongly Paid $25 Million to Dead Doctors Over 3-Year Period 

Under federal rules, Medicare is not supposed to pay the bills of dead doctors. Yet, a 2008 Congressional hearing that Dr. Coburn participated in revealed Medicare was paying millions of taxpayer dollars for dead doctors. Earlier this year, Dr. Coburn asked the Inspector General of the U.S. Department of Health and Human Services, to see if this was still a problem within Medicare. The Inspector General reviewed Medicare claims and found that Medicare had paid $25 million to dead doctors from 2009 to 2011. Given some the lag time in billing, there may be some circumstances where some of those payments may be legitimate. Yet, even the most conservative approach to eliminating potentially valid claims found Medicare paid at least $8.2 million for dead doctors!  Despite that Medicare officials have told this was a problem five years ago, they still have not given a timeframe for implementing corrective actions. 

Reports available here:

Medicare Payments Made on Behalf of Deceased Beneficiaries in 2011

Medicare Improperly Paid Millions of Dollars for Prescription Drugs Provided to Unlawfully Present Beneficiaries During 2009 Through 2011

Supporting Documents:

HHS Letter to Dr. Coburn 

###

New report documents how members of Congress have used the Park Service to advance parochial interests while ignoring billions in maintenance backlog at our nation’s most prized national parks, and outlines areas of low-priority and wasteful spending by the Park Service.

(WASHINGTON, D.C.) – U.S. Senator Tom Coburn, M.D. (R-OK) will unveil his new oversight report on the National Park Service entitled, “PARKED! How Congress’ Misplaced Priorities are Trashing Our National Treasures,” at a press conference on Tuesday, October 29, 2013, at 11:30 a.m. EST in Room S-325 of the Capitol. 

 WHAT:  Press conference to unveil new oversight report, “PARKED! How Congress’ Misplaced Priorities are Trashing Our National Treasures”

WHEN: Tuesday, October 29, 2013, at 11:30 a.m. EST

WHERE: Room S-325 of the Capitol

###

(WASHINGTON, D.C.) – U.S. Senator Tom Coburn, M.D. (R-OK) today sent a letter to the Department of Housing and Urban Development Secretary Shaun Donovan questioning the progress of the $60.4 billion Hurricane Sandy aid package Congress passed at the beginning of the year. 

In the letter, Dr. Coburn writes, “It has been nearly 10 months since disaster aid was appropriated, and I am troubled by the fact that so little money has reached the people who need it.”

The response is here.  

(WASHINGTON, D.C.) - Dr. Coburn released the following statement after the Senate voted to fund the federal government through January 15 and raise the debt ceiling through February 7.

“Washington doesn’t need short-term budget and debt limit extensions as much as we need a long-term spending addiction recovery plan.  The American people should do what any responsible parent would do if their adolescent child couldn't handle the responsibility of a credit card.  We should cut up the credit card and live within our means.  With this agreement, the hard decisions we have to make have only been put off for another day, when our fiscal problems will be bigger and more painful to solve.  It’s time to make tough choices now.” 

 ###

Protecting Taxpayers by Requiring Obamacare Exchanges to Verify Income Before Disbursing Subsidies

 On August 1st, Drs. Coburn, Barrasso and Boozman introduced the “Requiring Exchange Verification of Eligibility to Receive Income-Related Funds for Individuals” or “Requiring E-VERIFI” Act of 2013 (S.1455).  This bill would require that the Inspector General of the U.S. Department of Health and Human Services (HHS OIG) certify that a program to “successfully and consistently” verify household income is operational, before any federal Exchange subsidies could be sent out under the Patient Protection and Affordable Care Act/Obamacare.  

 There have been a number of concerns as to whether or not the Administration would ensure that Americans receiving subsidies under the law meet the eligibility requirements of the law. Based on the intensity of these concerns, when testifying before the House Ways & Means Committee in August 2013, Gary Cohen, the director of CMS’ Center for Consumer Information and Insurance Oversight, back-pedaled from prior statements and announced HHS was going to check American’s income level and eligibility. He said HHS would be “sampling 100 percent” of applicants for coverage to have their income verified before receiving federal insurance subsidy for health coverage.

 However, the concerns about program vulnerabilities remain valid, based on the implementation challenges HHS is facing, and the significant body of research from the Government Accountability Office and HHS OIG showing vulnerabilities with other existing HHS programs. While Dr. Coburn supports repealing Obamacare and replacing it with market-driven, patient-centered reforms that lower costs, as Obamacare is being implemented, HHS should at least be required to take needed, common-sense steps to prevent fraud.  

 If Members of Congress believe HHS is taking all necessary precautions to prevent the fraudulent diversion or abuse of taxpayer dollars, they should support Dr. Coburn’s bill. However, there are at least two important reasons Members of Congress and concerned citizens should support the passage of this bill.

 First, given the Administration’s record, it’s highly questionable the program HHS’s aspirational claims will match operational reality. The Administration’s launch of Obamacare has been full of glitches and delays. To date, HHS has already missed dozens of deadlines it was required to meet in federal law. And a review by the Congressional Research Service found the Administration has already delayed five significant provisions of the law.  Why should Congress trust HHS’s claims when they’ve delayed, ignored, or bungled other requirements in the law?

 Second, on September 11, 2013, the White House issued a veto threat against the House companion version of this bill. (Dr. Coburn’s bill is the Senate companion to Rep. Diane Black’s “No Subsidies Without Verification Act” (H.R. 2775 which passed the House on September 12, 2013 with five Democrats supporting it). In the words of the White House, the House version of the legislation “would undermine this [coverage] security by delaying tax credits and cost-sharing reductions that will otherwise be provided to millions of Americans." The White House even warned that the “legislation’s unnecessary Americans." The White House even warned that the “legislation’s unnecessary pre-certification requirement would impede opening the Marketplaces on October 1st.”

However, if the Exchange subsidy program were secure and verifying income as the Administration has claimed, there be no delay in subsidies being disbursed. Therefore, the Administration’s veto threat effectively confirms suspicions the that program is not ready for prime time and could waste taxpayer dollars.

Adopting Dr. Coburn’s bill is especially important because the law includes a provision which limits how much the federal government can recover from sending a greater amount of subsidy to consumers than for which they were eligible. In other words, the law currently prevents recovering overpayments to individuals who turn out not to be eligible for them. [Citation: P.L. 112-9, Sec. 4 amends sec 36B(f)(2)(B) of the Internal Revenue Code).]  However, unless Congress adopts this bill, this cap on recovering overpayments will prevent federal officials from pursuing overpayments –potentially hundreds of millions, even billions of dollars in overpayments. In fact, according to CBO, if that cap on recapturing subsidy overpayments were eliminated, taxpayers would save $43 billion over a decade.

 Members of Congress have a duty to protect all taxpayer dollars from being wasted and federal payment systems from being defrauded. Member of Congress who are serious about this responsibility should support this bill. 

View the full document here.

This document summarizes elements of the Congressional Budget Office’s 2013 Long-Term Budget Outlook and CBO’s blog post, “Federal Spending on the Government’s Major Health Care Programs Is Projected to Rise Substantially Relative To GDP.”  Content other than headers are quotes.

Health Care Spending Will Continue to Increase the Deficit

  • Budget deficits would gradually rise again under current law, CBO projects, mainly because increasing internet costs and growing spending for Social Security and the government’s major health care programs (Medicare, Medicaid, the Children’s Health Insurance Program, and subsidies to be provided through health insurance exchanges).
  • The pressures of an aging population, rising health care costs, and an expansion of federal subsidies for health insurance would cause spending for some of the largest federal programs to increase relative to GDP. The aging of the baby-boom generation, together with growth in health care spending per person and an expansion of federal subsidies for health insurance, is expected to steadily boost the government’s spending for Social Security and major health care programs. Barring changes to current law, that additional spending would contribute to rising budget deficits starting in a few years, causing federal debt to swell from a level that is already very high relative to the size of the economy.

 The Current Spending Path Is Unsustainable, Even “Impossible” to Maintain

  • By 2023, federal debt held by the public would equal 71 percent of GDP and would be on an upward trajectory. Under a wide range of possible assumptions about some key factors that influence federal spending and revenues, the budget is on an unsustainable path.
  • Deficits are sustainable in the long run only if federal debt grows no more rapidly than the economy. But under the extended baseline, interest rates would exceed the growth rate of the economy.
  • The growth of health care spending cannot exceed economic growth indefinitely, because if it did, total spending on health care would eventually account for all of the country’s economic output—an impossible outcome.

 Spending on Federal Health Care Programs Will Outpace Economic Growth

  • Most of the projected growth in noninterest spending as a share of GDP over the long term is expected to come from the government’s major health care programs: Medicare, Medicaid, the Children’s Health Insurance Program, and subsidies to help people purchase health insurance through the exchanges created under the Affordable Care Act. Under current law, total outlays for those health care programs, net of offsetting receipts, would grow much faster than the economy, increasing from almost 5 percent of GDP now to 8 percent in 2038.
  • Although the growth of health care spending has slowed recently, CBO projects that spending per enrollee in federal health care programs will continue to increase at a faster pace than per capita GDP.

 Increased Spending Driven By Aging Seniors, Rising Costs, and Obamacare

  • Those projected increases in spending stem from three factors: the aging of the population; rising health care spending per beneficiary; and changes related to the ACA, specifically the introduction of exchange subsidies and the expansion of Medicaid in many states.
  • Three factors underlie the projected increase in federal spending for the major health care programs and Social Security as a percentage of GDP: the aging of the U.S. population, “excess cost growth,” and the upcoming expansion of Medicaid eligibility and provision of health insurance subsidies authorized by the ACA.

Federal Entitlement Programs – Including Obamacare – Are Driving Our Spending Problem

  • The growth of federal noninterest spending as a share of gross domestic product (GDP) results entirely from projected increases in spending for a few large programs: Social Security, Medicare, Medicaid, and (to a lesser extent) insurance subsidies that will be provided through the health insurance exchanges established under the Affordable Care Act (ACA). The health care programs, which currently account for just over half of total spending for those large programs, are responsible for almost three-quarters of the rise in spending projected for those programs over the next 25 years under the extended baseline.

 Federal Spending A “Challenge” For “State and Local Governments, Businesses, and Households”

  • Although spending for health care in the United States has grown more slowly in recent years than it had previously, high and rising levels of such sending continue to pose a challenge not only for the federal government’s two major health insurance programs, Medicare and Medicaid, but also for state and local governments, businesses, and households.

 

Annual Increase in Health Spending Outpaces Economic Output Per Person Since 1985

  • Total national spending on health care services and supplies increased from 4.6 percent of GDP in calendar year 1960 to 9.5 percent in 1985 and to 16.4 percent in 2011, the most recent year for which such data are available. Underlying those trends, health care spending per person has grown faster, on average, than the nation’s economic output per person since 1985, even after the recent slowdown is factored in.
  • CBO estimates that growth in health care spending per person (after adjusting for demographic changes) has outpaced growth in GDP per capita by an average of 1.5 percent per year since 1985.

 Obamacare Part of “Sharp Increase” In Number of People Pushing Federal Health Spending Higher

  • …Federal spending for health care will be pushed up in the future by a sharp increase in the number of people receiving benefits from government programs……[including] the expansion of federal support for health insurance under the Affordable Care Act (ACA), which will significantly increase the number of people receiving benefits from Medicaid and make other people eligible for subsidies for health insurance purchased through exchanges.
  • Over the next 25 years, aging accounts for 35 percent of the programs’ spending growth relative to GDP in CBO’s extended baseline, excess cost growth accounts for 40 percent, and the expansion of federal subsidies accounts for 26 percent.

 Medicare Spending On Track to Nearly Double Over Next 25 Years

  • Net federal spending for those programs (that is, spending net of offsetting receipts for Medicare) would grow from an estimated 4.6 percent of GDP in 2013 to 8.0 percent in 2038.

 Future Federal Health Care Spending Could Be Even Worse Than Predicted

  • Beyond the coming decade, projecting federal health care spending becomes increasingly difficult because of the considerable uncertainties involved. A wide range of changes could occur—in people’s health, in the sources and extent of their insurance coverage, and in the delivery of medical care—that are almost impossible to predict but that could have a significant effect on federal health care spending. Therefore, CBO followed a fairly formulaic approach for the projections beyond 2023.
  • Several [sic] demonstrations are currently under way; which of them—if any—will prove to be successful in slowing spending growth and can be scaled up is uncertain.

Taxpayers Are Increasingly Paying More for Medicare through General Federal Tax Revenue

  • The amount of Medicare payroll taxes collected has declined from 63 percent of gross federal spending for Medicare in 2000 to an estimated 35 percent in 2013. During that same period, the share of those benefits financed by beneficiaries’ premiums and other offsetting receipts has grown from 10 percent to an estimated 13 percent, and the share financed by general funds of the government, income taxes on benefits, and the remaining sources of funding for the program has increased from 27 percent to 51 percent.

 Making Medicare Solvent Requires Hard Choices

  • Eliminating [Medicare’s solvency gap] would require an immediate and permanent increase in HI payroll taxes from 2.9 percent to 3.9 percent of taxable payroll as currently projected, an immediate and permanent cut in spending on Part A equal to almost one-quarter of current spending, or some combination of tax increases and spending cuts with an overall present value equal to 1.0 percent of projected taxable payroll..

 Medicare’s Insolvency Means Seniors Access to Health Care “Would Almost Certainly Be Reduced”

  • Once the HI trust fund was exhausted, it appears that total payments to health plans and providers for services covered under Part A of Medicare would be limited to the amount of revenues subsequently credited to the trust fund. If that occurred, beneficiaries’ access to health care services would almost certainly be reduced.

 Seniors on Medicare Have Increasingly Benefits Greater Relative To Their Contributions

  • Over their lifetime, beneficiaries born in the 1940’s would, on average, receive about $160,000 in benefits (net of premiums paid) and pay about $45,000 in payroll taxes (both figures are expressed in 2013 dollars). Those born in the 1950’s would receive, on average, about $205,000  in benefits and pay about $60,000 in payroll taxes, CBO estimates. And those born in the 1960’s would receive, on average, about $270,000 in benefits and pay about $65,000 in payroll taxes.
Full document available here

In a letter to PGA Tour Commission Tim Finchem, Dr. Coburn asks the association to clarify questions about their 501 (c)(6) tax-exempt status.  The full letter is below: 

October 10, 2013

 

Commissioner Tim Finchem
PGA Tour, Inc.
112 PGA TOUR Blvd.
Ponte Vedra Beach, FL 32082

Dear Commissioner Finchem:

I commend the PGA Tour for its commitment to assisting charitable organizations nationwide by leveraging the popularity of golf and the Tour’s players.  As an avid fan of golf, I know the sport has grown in popularity in recent years.  With its success, your organization has helped to raise almost $2 billion for local charities, an astounding feat.  Charities bring vital physical, emotional, and spiritual support to millions of Americans every year, especially during crises, such as when tornadoes tore through Oklahoma in this past May.  Many nonprofit entities also enrich society through their support of arts, education, and literary ventures.  This sector is undeniably important to the nation.  The Tour’s model in partnering with charitable organizations that organize and manage most Tour events while capturing a portion of the overall revenue is unique. 

I have introduced a bill in the United States Senate, the Properly Reducing Overexemptions for Sports Act (PRO Sports Act), that would prohibit major professional sports leagues from qualifying for the 501(c)(6) tax status used by trade associations and chambers of commerce.  As you know, a number of major leagues, including the PGA Tour, are registered as 501(c)(6) entities.  When asked about the PRO Sports Act by Golf Digest, your organization recently issued a statement highlighting its approach of partnering with charities to help them raise funds through tournament management. 

I respectfully ask you assist my oversight of the tax-exempt sector by responding to the following questions:

1. If it no longer qualified for the 501(c)(6) tax-exempt status, would PGA Tour, Inc. still have the legal option to partner with 501(c)(3) charitable organizations, allowing them to organize and manage tournaments to capture some of the overall revenue?

2. If it no longer qualified for the 501(c)(6) tax-exempt status, would PGA Tour, Inc. still have the legal option to donate millions of dollars in funds and services to 501(c)(3) charitable organizations?

3. If it no longer qualified for the 501(c)(6) tax-exempt status, would PGA Tour, Inc. still be able to benefit from special tax provisions included in the Tax Reform Act of 1986, including full deductibility of event tickets – a provision generally not applicable to the tickets of many other sports leagues – and the substantial presence exemption for foreign professional athletes likely utilized by some PGA Tour golfers? 

4. What were the total charitable donations of PGA Tour, Inc. each year over the last five years?  Please delineate between cash and non-cash assistance, and provide a list of the top five recipients in each year over the last five years, including the amounts received by each.

 With the tax code as complex and cumbersome as it is, I look forward to streamlining and simplifying it so businesses like the PGA Tour can thrive.  Thank you in advance for your cooperation and assistance.

 

Sincerely,

 

           

Tom A. Coburn, M.D.
Ranking Member
Committee on Homeland Security and Governmental Affairs

(WASHINGTON, D.C.) – Today, Homeland Security and Governmental Affairs Committee Ranking Member Tom Coburn, M.D. (R-OK), Chairman Tom Carper (D-DE), Permanent Subcommittee on Investigations Chairman Carl Levin (D-MI) and Permanent Subcommittee on Investigations Ranking Member John McCain (R-AZ), released the findings of a two year investigation into a case study of abuses surrounding the approval process of Social Security Disability benefits.  The report, entitled, “How Some Legal, Medical, and Judicial Professionals Abused Social Security Disability Programs for the Country’s Most Vulnerable: A Case Study of the Conn Law Firm,” details inappropriate conduct and collusion between a law firm, Social Security Law Judges and doctors in approving benefits, while outlining the inept agency oversight which allowed the misconduct to take place for years.

 The investigation was led by Senator Coburn.  The first year of the investigation was conducted by the Permanent Subcommittee on Investigations when Senator Coburn was the Ranking Member there, prior to his becoming the Ranking Member of the full Committee.  The Committee will hold a hearing today featuring the report entitled: “Social Security Disability Benefits:  Did A Group of Judges, Doctors and Lawyers Abuse Programs for the Country’s Most Vulnerable?” on Monday, October 7, 2013, at 3 p.m. EST in room 342 of the Dirksen Senate Office Building in Washington, D.C.  The hearing will be broadcast on CSPAN 3.          

 “This report highlights the very problems Congress needs to focus on but too often ignores.  In just two years, the Social Security Disability Trust Fund could be depleted.  That means millions of disabled Americans will face benefit cuts while every American could see an increase in their payroll taxes.  That is unacceptable.  What is also outrageous, as this report details, is how well-heeled and well-connected lawyers, doctors, and judges have gamed the system for their own benefit.  Every bogus claim made on behalf of someone who is not truly disabled robs taxpayers and denies or delays benefits for someone who is truly disabled.   This is an enormous and urgent problem that should demand our immediate attention,” Ranking Member Coburn said, noting that a previous report on the disability program showed at least more than 25 percent of 300 disability cases reviewed contained errors or poor quality analysis.  

 “This investigative report details some very troubling occurrences within the Social Security disability review office in West Virginia,” Chairman Carper said.  While we don't have any evidence that this is more than an isolated case, one example of inappropriate actions of this nature is one too many. I welcome the opportunity to hold a hearing today examining a number of issues surrounding Social Security’s disability programs, gather facts and attempt to ascertain the truth. In the midst of this very partisan time, one thing that Republicans and Democrats agree on is that we need to make every effort to ensure our federal programs are well run and are as free as possible from abuse or wasteful practices.  Whether it’s Delaware, West Virginia, or anywhere else in our nation, we need to ensure strong oversight in all of our government operations, to ensure both fairness and effectiveness. I am encouraged that the Social Security Administration has already acknowledged many of the issues raised by the investigation, and I understand that it has begun to implement stronger reviews and other solutions. My colleagues and I in Congress will continue to work with the Administration to provide oversight, guidance and resources to ensure that a few bad actors don't take scarce tax payer resources from those who truly deserve them.”

 “Federal disability programs provide critical assistance to the most vulnerable among us,” said Senator Levin, “and we can’t afford for those programs to be undermined by a law firm engaged in improper and collusive conduct that is abusive, longstanding, and intolerable.  The report doesn’t decide whether the benefits awarded to individuals represented by Eric Conn were right or wrong, since there are too many claimants to generalize.  Nor does it apply to the dedicated and honest professionals that keep our disability programs going despite limited resources and back-breaking caseloads.  After all, the investigation was launched after Social Security whistleblowers exposed the wrongdoing.  Our goal is to spotlight the abusive conduct, put an end to it, and recommend measures to prevent similar abuses in the future.”

 “The findings in the report regarding potential fraud in the Social Security Disability Programs are alarming and demand immediate attention by Congress, the Social Security Administration, and – where evidence obtained by the Committee suggests that crimes were committed – the Department of Justice,” said Senator McCain. “These programs are designed to help those who are most in need because of their inability to work. Yet, their susceptibility to being abused, at a cost of billions of taxpayer dollars, threatens both their viability and their continued ability to help those actually in need of the government’s help.”

 Key findings of the report include:

 • Daugherty Awarded More Than $2.5 Billion in Benefits in the Last Years of His Career. Judge Daugherty moved an unusually large number of disability cases through the agency and awarded an unusually high percentage of disability benefits. Over a nearly seven year period, from 2005 to his retirement in mid-2011, Judge Daugherty awarded disability benefits to 8,413 individuals, which translates into about 1,200 cases per year and an estimated total award of federal lifetime benefits exceeding $2.5 billion.

 • Judge Provided “DB Lists” to Conn Law Firm. From at least June 2006 to July 2010, Judge Daugherty telephoned the Conn law firm each month and identified a list of Mr. Conn’s disability claimants to whom the judge planned to award benefits. Judge Daugherty also indicated, for each listed claimant, whether he needed a “physical” or “mental” opinion from a medical professional indicating the claimant was disabled. Over the four year period reviewed, from 2006 to 2010, the monthly list identified between 14 and 52 disability claimants each time for at least 1,823 claimants. Conn Law Firm personnel referred to the monthly list as the “DB List” for David B. Daugherty.

 • Daugherty Relied on Conn’s Doctors to Generate Medical Evidence. After receiving the DB List, Mr. Conn’s office scheduled appointments for the identified claimants with certain doctors favored by the law firm. The Conn law firm provided several of those doctors with physical or mental residual functional capacity (“RFC”) forms in which the medical information was already filled out, and the doctors signed the forms without making any changes. Frequently, these pre-filled forms contained information that conflicted with other information in the claimant’s case file.

 • Identical Medical Evidence Used for Multiple Claimants. A review of the RFC forms found that the Conn law firm supplied certain doctors with 15 pre-filled versions of the physical RFC form and five pre-filled versions of the mental RFC form for hundreds of claimants. In almost all cases, only the names and Social Security numbers on the forms differed. Of the forms reviewed, 97 described the claimants as having the exact same limitations and contained no unique medical or employment information specific to the claimant. Because each individual has different abilities and ailments, and the forms require a complex set of data, finding two RFCs exactly alike should have statistically been an extremely rare occurrence.

 • Key Doctors Had Suspect Credentials. Of the doctors used by the Conn law firm to produce medical opinions for disability claimants, two had their medical license suspended or revoked in another state. Under SSA rules, a doctor with a suspended or revoked license could not be used by the Social Security Administration to review a disability case, but could still examine claimants at the request of a claimant or outside attorney.

 • Judge Daugherty Wrote Questionable Decisions Relying on Mr. Conn’s Doctors. A review of 110 case files for disability claimants listed on the DB Lists found the vast majority to contain highly questionable decisions. In all 110 cases, Judge Daugherty’s decisions justified reversing the agency’s prior denial of disability benefits by relying solely on the medical forms provided by the doctors procured by the Conn law firm. All but two of the 110 cases used the agency’s Medical-Vocational grid guidelines to award benefits.

 • Mr. Conn Obtained Millions in Attorney Fees Paid by SSA. From cases on the DB Lists alone, over the four year period from 2006 to 2010, the Social Security Administration paid Mr. Conn over $4.5 million in attorney fees.10 Social Security records show that, altogether in 2010, Mr. Conn was the third highest paid disability law firm in the country due to its receipt of over $3.9 million in attorney fees from the Social Security Administration. In 2009, Mr. Conn received a total of $3.5 million in attorney fees from the agency.

 • Mr. Conn Paid Doctors Substantial Fees for Evaluations. The doctors used by Mr. Conn to evaluate his claimants were also paid substantial fees. A review of records found that, over the past six years, Mr. Conn paid five doctors almost $2 million to provide disability opinions for his claimants. Mr. Conn contracted with his claimants to repay the fees given to the doctors to perform their medical evaluations.

 • Daugherty Bank Records Show $96,000 in Unexplained Cash Deposits. From 2003 to 2011, Judge Daugherty’s bank records contain regularly occurring cash deposits totaling $69,800, the source of which is unexplained in the judge’s financial disclosure forms. From 2007 to 2011, his daughter’s bank records list similar cash deposits totaling another $26,200. When asked about the $96,000 in cash deposits, Judge Daugherty refused to explain their origin or the source of the funds.

 • SSA Whistleblower Targeted by Huntington Chief Judge Andrus and Eric Conn. Following the public disclosure of Mr. Conn’s relationship with Judge Daugherty, Huntington Chief ALJ Andrus worked with Mr. Conn to discredit and retaliate against an SSA employee suspected of leaking the information.

 • Mr. Conn Destroyed Documents during an Investigation. After talking with SSA OIG investigators, Mr. Conn contracted with a local shredding company to destroy over 26,000 pounds of documents, the equivalent of 2.6 million sheets of paper. Former Conn law firm personnel asserted that he destroyed all hard copies of the DB Lists as well as computer hard drives in his office.

 ###

Supporting Documents: 

Dr. Coburn's Opening Statement

Exhibit Part 1

Exhibit Part 2

Exhibit Part 3

Exhibit Part 4

Exhibit Part 5

Exhibit Part 6

September 2013

(WASHINGTON, D.C.) – Today, U.S. Senator Tom Coburn, M.D. (R-OK) commented on the Continuing Resolution Congress is currently considering to fund the government:

“I’m disappointed the Senate has once again voted to break its commitment to taxpayers and violate its budget caps.  Lost in the back and forth this week regarding whether or not to shut down the government over Obamacare was a real debate about all the other things that this bill will fund.  The spending restraint Americans imposed on Washington in the Budget Control Act is being undone.  The big spenders in Washington in both parties have argued the CR does not spend enough and we now have a bidding war between the House and Senate over how much we should increase spending next year.  The CR passed today sets fiscal year 2014 spending at $20 billion more than the spending caps set by the bipartisan compromise Budget Control Act, and includes an additional $18 billion in short-term accounting gimmicks.  That means the Senate is violating the spending caps by $38 billion."

“The big spenders say sequestration has cut government to the bone, yet this restraint is helping to heal our economy by reducing the debt – and deferred taxes – on future generations.  And in terms of waste, we’ve just scratched the surface.  When some Senators were using flawed and pretend 'filibuster' tactics to defund Obamacare that were destined to fail, they should have instead been focusing on how the CR wastes scarce taxpayer dollars by funding, for example, studies about how Americans view the filibuster. Elsewhere, just this week the government celebrated Christmas in September by funding numerous Christmas tree projects across the country plus a number of other stupid projects like junkets for Chinese wine connoisseurs and a maple syrup recipe contest.  Let’s defund wasteful spending, not just Obamacare.  And let’s shut down wasteful spending in all its forms."

Examples of wasteful spending to shutdown include hundreds of new grants costing tens of millions of dollars or more announced just this week

  • Thirty five wine projects, such as funding for 10 grants to support wine tasting including wine trail smartphone apps to help “navigate to the next winery.”
  • Four Christmas tree initiatives, including support to promote Virginia Christmas trees, to shear Michigan Christmas trees, and training seminars on best practices for exporting Christmas trees
  • The “USA Pear Road Show” to China, a federally funded trip to Asia to advertise American pears.
  • Social media for apples
  • Radio advertisements about New Jersey blueberries
  • Two promotional campaigns to promote strawberries
  • Funding for  the  Organizing Maple Weekend in Massachusetts which includes a recipe contest
  • Funding for a YouTube video promoting proper handling of watermelon (Georgia Watermelon Association)

Examples of wasteful spending supported by the CR include:

  • Funding for the National Science Foundation (NSF) for the development of “Snooki,” a robot bird that impersonates a female sage grouse to examine the importance of courtship tactics of males.
  • Funding for an NSF grant that studies Americans’ attitudes towards the U.S. Senate filibuster
  • NSF grant to SiteJabber.com, a new website to rate the trustworthiness of other websites
  • NSF grant funding to EcoATM, a company commercializing an “ATM” to give out cash in exchange for old cell phones and other electronics
  • NSF grant paying for participants’ expenses to attend an annual snowmobile competition in Michigan through 2015
  • NSF grant paying for meditation and self-reflection for math, science, and engineering majors
  • Four-year NSF grant that funds displays along the six Indianapolis waterways, used to display paintings about Indianapolis’s water system.
  • The Institute of Museum and Library Sciences is funding “Puppets Take Long Island,” a puppet festival at a Long Island New York children’s museum.

###

Q: Does Dr. Coburn support defunding Obamacare?

A:  YES. Dr. Coburn has always supported efforts to delay, defund, and repeal Obamacare.  Dr. Coburn offered his free market alternative to Obamacare, the Patient’s Choice Act, but it was blocked by Majority Leader Harry Reid. Dr. Coburn has since conducted extensive oversight on Obamacare (See here, here, here, and here.)  In fact, Dr. Coburn has been involved with amending or destroying certain provisions of Obamacare nine times.   

Q: Does Dr. Coburn support the Continuing Resolution (Including both House and Senate versions as of September 26, 2013)?

A: NO.  Dr. Coburn has never supported continuing resolutions because they are short term budgetary band-aids that continue wasteful spending and duplication. Continuing Resolutions are an irresponsible way to fund the federal government.  Further, this particular Continuing Resolution sets the fiscal year 2014 spending level at $20 billion more than the spending level promised in the Budget Control Act - the 2011 bipartisan agreement to reduce government spending - plus an additional $18 billion in short-term accounting gimmicks.  This bill violates the spending restraint laid out in the Budget Control Act and increases government spending at a time when we are nearly $17 trillion in debt and borrowing 19 cents for every dollar we spend and adding to our debt nearly $26,000 every single second.

Q: Why doesn’t Dr. Coburn support the “Defund Obamacare Campaign” associated with the current CR?

A: Because attaching it to the CR is not achievable or strategically smart.  Dr. Coburn has and will continue to support defunding Obamacare.   The current “Defund Obamacare” campaign, however, is based on a false promise that has been used by special interest groups to bolster political careers instead of focusing on smart strategies that can actually weaken and destroy Obamacare.  By coupling the issue with the CR, these groups are telling the American people that Republicans in Congress can actually defund Obamacare by not voting for the CR or by allowing the government to shut down.  This is simply not true.  Simply put: we cannot defund or replace Obamacare completely until we have a Republican supermajority in the House and Senate that can override a Presidential veto.  Even then, Dr. Coburn questions if we could obtain all 67 votes in the Senate needed to override a veto.   Additionally, the Congressional Research Service (CRS) issued a report which concluded that even if the government were to be shutdown, Obamacare would still live on, not least of because the power to continue its implementation would be given to President Obama.  Again, if a shutdown occurred, Obamacare would remain nearly fully funded and implementation of the exchanges would still continue on October 1, 2013.

Q:  How can Dr. Coburn support defunding Obamacare but not support the current  “Defund Obamacare” strategy with the CR?

A: Because it is not achievable and has actually allowed for focus to be taken away from increased spending.  Since there are not enough votes to secure defunding Obamacare and since Obamacare will live on even if a government shutdown occurs, conservatives should instead be focusing on the spending levels in the current CR.  The House CR actually busts the budget caps set forth in the Budget Control Act (BCA) by $20 billion and includes $18 billion more in short-term accounting gimmicks; negating much of the savings found through the sequester.

Q: But no one is talking about shutting down the government, so why is Dr. Coburn still against the “Defund Obamacare with the CR”?

A:  Because Dr. Coburn wants to shut down ALL wasteful and duplicative spending.  The “Defund Obamacare” campaign has distracted true fiscal conservatives from the fact that the current CR increases spending.  Dr. Coburn wants the debate surrounding the CR spending bill to focus on what is workable on spending, not misleading strategies meant to raise political profiles and campaign cash.

Just the Facts:

Dr. Coburn supports defunding Obamacare and is opposed to the CR, but Dr. Coburn disagrees with the misleading and ill-conceived “Defund Obamacare” strategy promulgated by special interest groups to bolster political careers and campaign coffers.  Dr. Coburn wants to cut through the smoke and mirrors of DC rhetoric to get something done: SHUTDOWN ALL WASTEFUL SPENDING. 

Supporting Documents:

Q and A 

(WASHINGTON, D.C.) – Today, Homeland Security and Governmental Affairs Committee Ranking Member Tom Coburn, M.D. (R-OK) released the following statement regarding the U.S. Postal Service Board of Governors decision to increase postal rates:

“The Board of Governors is absolutely right to exercise its fiduciary responsibility to preserve the viability of the Postal Service absent Congressional action, but the issues facing Postal Service require a comprehensive long-term legislative solution,” Dr. Coburn said. “I am hopeful both the House and Senate committees and the Administration continue to move forward in supporting bipartisan, commonsense reforms to make the Postal Service fiscally solvent.”

Ranking Member Coburn, along with Chairman Tom Carper (D-DE) introduced the bipartisan Postal Reform Act of 2013 (S. 1486) in August.

###

In a letter to IMLS Director Susan Hildreth, Dr. Coburn expresses concern with the IMLS using taxpayer funds to promote Obamacare instead of using scare resources on civic advancement and education.

Today, 17 Senators sent a letter to HHS requesting an extension of Stage 2 for providers and hospitals that need it, while still abiding by the statutory authority they have to make incentive payments only through 2016. 

In recent months, several major health information technology stakeholders, such as CHIME, AHA, and AMA, have asked the U.S. Department of Health and Human Services (HHS) for additional time to comply with “Stage 2” of the Meaningful Use incentive program.  The Senators expressed their desire for providers who are ready to attest to Stage 2 in 2014 to do so, but noted concern about the timing bottleneck that is occurring in 2014 and the growing digital divide between urban and rural areas. 

In the letter, the Senators encourage HHS to keep pressure on vendors to continue to promote interoperability.  The Senators note Stage 2 should be itself be meaningful, given the data about providers who dropping out of the meaningful use program.  Otherwise, the more that providers opt not to continue in the program, the greater risk there is that wide-spread adoption of health IT and interoperability, will not be accomplished – which would jeopardize over $30 billion in HITECH Act funds. 

In 2014, over 500,000 hospitals and physicians will be required to upgrade their existing technology to demonstrate new standards of “meaningful use” in order to be eligible for the corresponding incentive payments.  Vendors are under tremendous time pressure to ensure their products are certified and have sufficient time to upgrade their products for each client.  But simply installing updated software is only the beginning of a lengthy process to satisfy Stage 2 attestation requirements.  

Sep 19 2013

Chairman Carper, Ranking Member Coburn Continue Oversight in Wake of Navy Yard Shooting

Chairman, Ranking Member intend to hold hearings on security clearances and other issues raised in the wake of the Navy Yard tragedy

WASHINGTON, D.C. – Today, Senate Homeland Security and Governmental Affairs Committee Chairman Tom Carper (D-Del.) and Ranking Member Tom Coburn (R-Okla.) released the following statements regarding the Committee’s ongoing oversight of government operations and the federal workforce, in particular the issue of security clearances, in the wake of the Navy Yard Shooting in Washington, D.C.:

Chairman Carper: “Our thoughts and prayers go out to the victims and the friends and families of those impacted by the tragic events at Washington, D.C.’s Navy Yard. We are deeply grateful for the efforts of our brave civil servants, law enforcement officials, and emergency medical personnel who responded to this tragedy. Our goal is to ensure that we learn as much from this tragic incident as we possibly can so we can prevent these types of incidents and reduce the chance of death and injury in the future.

“As the Committee with oversight of government operations, the federal workforce, and homeland security, we have a number of important questions that have come to light after this incident that we need to have answered. In particular, our Committee needs to take a closer look at the background check process for individuals applying for security clearances, whether they are contractors or federal employees, and we need to examine what the oversight process is once an individual obtains a security clearance. We want to make certain that, when conducting background investigations, agencies have access to the right information and are asking the right questions and getting the right answers. We also want to look at the process for gaining access privileges to secure facilities, such as the Navy Yard. While we’re beginning to gather information, we still have many more questions to ask - and more answers to get. That’s why our Committee continues to examine what happened and will hold hearings on these and other issues raised in the wake of this terrible tragedy in the very near future.”

Dr. Coburn: “We owe it to the families of the victims and the American people to uncover what went wrong. We need to take a very hard look at the security clearance process, in particular, and explore other questions as we work to prevent another tragedy like this from ever occurring again.”

###

WASHINGTON – Today, Senate Homeland Security and Governmental Affairs Committee Chairman Tom Carper (D-Del.) and Ranking Member Tom Coburn (R-Okla.) released the following statements regarding the Committee’s ongoing oversight of government operations and the federal workforce, in particular the issue of security clearances, in the wake of the Navy Yard Shooting in Washington, D.C.:

Chairman Carper: “Our thoughts and prayers go out to the victims and the friends and families of those impacted by the tragic events at Washington, D.C.’s Navy Yard. We are deeply grateful for the efforts of our brave civil servants, law enforcement officials, and emergency medical personnel who responded to this tragedy. Our goal is to ensure that we learn as much from this tragic incident as we possibly can so we can prevent these types of incidents and reduce the chance of death and injury in the future.

“As the Committee with oversight of government operations, the federal workforce, and homeland security, we have a number of important questions that have come to light after this incident that we need to have answered.  In particular, our Committee needs to take a closer look at the background check process for individuals applying for security clearances, whether they are contractors or federal employees, and we need to examine what the oversight process is once an individual obtains a security clearance. We want to make certain that, when conducting background investigations, agencies have access to the right information and are asking the right questions and getting the right answers. We also want to look at the process for gaining access privileges to secure facilities, such as the Navy Yard. While we’re beginning to gather information, we still have many more questions to ask - and more answers to get. That’s why our Committee continues to examine what happened and will hold hearings on these and other issues raised in the wake of this terrible tragedy in the very near future.”

Dr. Coburn: “We owe it to the families of the victims and the American people to uncover what went wrong. We need to take a very hard look at the security clearance process, in particular, and explore other questions as we work to prevent another tragedy like this from ever occurring again.”

###

(WASHINGTON, D.C.) – Today, U.S. Senator Tom Coburn, M.D. (R-OK) introduced the PRO Sports Act, S.1524, which would amend the tax code to prohibit professional sports organizations with annual revenues over $10 million from enjoying the same tax-exempt, 501(c)(6) status as industry trade associations and public interest groups.

“Tax earmarks are essentially tax increases for everyone who doesn’t receive the benefit.  In this case, working Americans are paying artificially high rates in order to subsidize special breaks for sports leagues.  This is hardly fair,” Dr. Coburn said.  “This bill would require major professional sports leagues to be prohibited from qualifying as non-profit organizations under the tax code.  This would help give all Americans, not just athletes and owners, a break and pave the way for the kind of tax reform and job creation our economy desperately needs.”

Currently, a number of professional sports leagues have central offices registered as 501(c)(6) tax-exempt organizations allowing for the opportunity for their revenue to be tax-free.  Leagues qualify for the tax-exempt status by stating their purpose is to help promote their respective sports and membership instead of themselves.  The PRO Sports Act will not impact leagues’ 501(C)(3) charitable organizations.

Additional information here.

A response from the Joint Committee on Taxation can be found here

Dear Colleague letter with co-sponsor Sen. Angus King here.

###

Sep 18 2013

Bennet, Coburn Amendment Reduces Government Waste by Consolidating IT Infrastructure

Amendment to Energy Efficiency Bill Could Save Up to $3 Billion

Washington, DC – The federal government is not on pace to reduce the number of federal data centers from 3,000 to fewer than 2,000 by 2015, a goal set by a consolidation effort aimed to reduce government waste and save roughly $3 billion in taxpayer dollars. Senators Michael Bennet (D-CO) and Tom Coburn (R-OK) are pushing a bipartisan proposal to help the government meet this goal by setting hard deadlines and requiring inventory and consolidation plans, since some agencies have been slow to act.

The senators filed an amendment to the Energy Savings and Industrial Competitiveness Act of 2013 (S.1392) currently being debated on the Senate floor.

“This proposal is one commonsense way that the federal government can help reduce the deficit and in the process cut its energy consumption,” Bennet said. “The administration has already identified this plan as a way to more efficiently use taxpayer dollars, but some agencies have been dragging their feet. It’s time to move forward and get the job done.”

“This bipartisan amendment makes the federal government more efficient by closing duplicative data centers that waste energy and scarce taxpayer dollars,” Dr. Coburn said.

Federal agencies have been instructed to develop consolidation plans under the administration’s Federal Data Center Consolidation Initiative (FDCCI), which would save up to $3 billion according to the Government Accountability Office (GAO). However, a number of agencies have been slow to begin to implement the plans – or, in some cases, to even take stock of the total number of centers they currently manage.

Under the FDCCI, the federal government committed to shut down at least 1,100 of the nearly 3,000 known data centers it owns and operates. Analysis completed by the GAO and the Administration determined that this could save close to $3 billion by 2015, with additional savings in the years beyond. However, the GAO has also found that implementation of the initiative has been delayed because a number of agencies have failed to complete a full inventory of existing data centers or develop a comprehensive consolidation plan.

The Bennet-Coburn amendment would require participating federal agencies to submit a complete data center inventory and consolidation plan, which must include a timeline for implementation and cost-savings estimates, to the Office of Management and Budget by hard deadlines next year. Participating agencies must also submit annual updates on their progress for the next five years.  In addition, the law would require an Inspector General review at each agency to ensure that the data center inventory is thorough, direct OMB to update Congress on cost savings realized to date, and ensure that GAO continue its annual reviews.

The GAO has publicly argued that legislation is needed to ensure that agencies move more decisively to close down unnecessary data centers. Senators Bennet and Coburn have worked closely with OMB and GAO to ensure that this legislation will help strengthen the initiative and achieve meaningful savings.

# # #

(WASHINGTON, D.C.) – Today, U.S. Senators Tom Coburn, M.D. (R-OK) and Joe Manchin (D-WV) introduced the Audit the Pentagon Act of 2013, S. 1510, a bill that provides incentives for the Department of Defense, which is the only Federal agency that has never fully complied with financial management laws, to meet its audit schedule while also instituting consequences for further failure to follow the law.

“You can’t manage what you can’t measure.  Every year the Pentagon fails to produce a viable financial audit they not only violate the Constitution, but put our nation’s security at risk because of a failure to effectively prioritize spending,” Dr. Coburn said.  “This summer the Pentagon cancelled important training and furloughed thousands of civilian personnel while it continued to waste billions on non-defense spending that had nothing to do with its core mission. A full and complete audit is the only way the department will be able to make better decisions about how it uses valuable taxpayer dollars.  This bill helps the Pentagon help itself by simply requiring the Pentagon to meet its own deadlines.  The Senate should pass this bill without delay.”

"The United States of America has – and will continue to have – the greatest military in the world. In order to maintain our great military strength, we need to make sure that we are cutting the fat and not the muscle from our Defense Department,” Sen. Manchin said. “We must ensure that we’re using our limited resources most efficiently to support the men and women in uniform. One of best ways to get the most accurate information about our spending and our military’s priorities is to shed light on the Department of Defense budget, without jeopardizing our national security secrets. It is simply unacceptable that the Department of Defense is the only major federal agency that has not completed a financial audit. Our bill will help to solve that problem.”

Key Findings and Provisions of the Audit the Pentagon Act:

  • The Department of Defense has never fully complied with these laws and has been on the Government Accountability Office’s “High Risk” list for waste, fraud,
    abuse, and mismanagement every year since 1995.
  • Secretary Hagel has affirmed his commitment to achieving audit-ready budget statements by the end of 2014, stating that he ‘will do everything he can to fulfill this commitment’ and confirming that auditable financial statements are essential to the Department of Defense not only improving the quality of its financial information, but also to reassuring the public and the Congress that it is a good steward of public funds.” 
  • Mandates that failure to obtain a clean audit opinion in 2018 will result in the military services not being allowed to fund new major defense acquisition programs past Milestone B, meaning that the Pentagon would not be able to enter into engineering and manufacturing development on a new weapon system until it passed a clean audit.
  • Requires the Department of Defense to amend its policies to prohibit the purchase of any “off-the-shelf” IT system that will take longer than three years to install and include provisions in the contracts for termination if the IT system is not delivered on schedule.     

###

    Sep 16 2013

    Senators Highlight GAO Report Detailing Improper Social Security Disability Insurance Payments

    New Report Identifies $1.29 Billion in Potential Improper Payments

    (WASHINGTON, D.C.) – Today, Senate Homeland Security and Governmental Affairs Committee Chairman Tom Carper (D-Del.), Ranking Member Tom Coburn (R-Okla.), and Permanent Subcommittee on Investigations Chairman Carl Levin (D-Mich.)  highlighted the report from the Government Accountability Office (“GAO”) entitled, “Disability Insurance: Work Activity Indicates Certain Social Security Disability Insurance Payments Were Potentially Improper.” In the report, GAO identified 36,000 individuals who received $1.29 billion in potential disability overpayments at the same time they were earning wages posted to the National Directory of New Hires (NDNH).

    “Today’s Government Accountability Office report identified an important opportunity to save millions of taxpayer dollars in this Social Security Administration’s vital disability program,” said Chairman Carper. “The report lays out clear, common-sense steps that the agency can and should take in order to avoid improper payments. However, if we’re serious about preventing waste and fraud and ensuring that these critical benefits get to the people who need and deserve them, Congress must also do its part and provide needed resources and access to basic anti-fraud data to the Social Security Administration.”

    “Today’s report demonstrates just how little importance the Social Security Administration places on policing its disability rolls,” said Dr. Coburn.  “SSA has known for years that it could prevent millions of dollars in improper disability payments using quarterly wage records, but chose not to.  With estimates showing the disability trust fund will be unable to pay full benefits as early as 2015, it is time for SSA to take action to protect the program for those who are truly unable to work because of a disability.”

    “Disability benefits need to go to the truly disabled,” said Senator Levin, “and better oversight of benefit recipients, including by reviewing their wage records, is critical to preventing waste, fraud and abuse.  It would be shortsighted for Congress to reduce the funding needed to conduct that type of oversight to strengthen federal disability programs.  It is also important, of course, not to put so much pressure on disabled workers who receive a paycheck that it would discourage program participants from seeking work that could enable them to get off the disability roles.”

    Currently, the agency does not compare the SSDI rolls to the NDNH database of wage information, which is updated quarterly with wage information through the federal Office of Child Support Enforcement.  Commonly referred to as the “deadbeat dad” database, the NDNH is primarily used to help states track down parents delinquent in child support obligations.  If an individual has wages listed in the NDNH, it is potential evidence they are working, which could disqualify them for disability benefits. The report found these 36,000 individuals posted wages during periods that would potentially disqualify the beneficiary from receiving benefits if they were working.

    GAO’s findings are in direct contention with SSA’s prior assertion it would not be cost-effective to use quarterly wage information to screen for work activity among disability recipients.  At an August 4, 2010 hearing before the Permanent Subcommittee on Investigations, SSA asserted the comparison performed by GAO was not cost effective stating using the NDNH “would generate a relatively large number of alerts and the return on investment would only be about $1.40 for every dollar spent.”[1] The agency estimated the cost of the reviewing the “additional alerts would be about $17 million.”[2]

    At the end of 2012, more than 10.89 million Americans received $136.9 billion in monetary benefits from the Social Security Disability Insurance.[3]

    ###



    [1]
    See Pages 124-25, Social Security Disability Fraud:  Case Studies
    in Federal Employees and Commercial Driver’s Licenses, Permanent Subcommittee on
    Investigations, Committee on Homeland Security and Government Affairs, United
    States Senate, 111th Congress, August 4, 2010, http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=111_senate_hearings&docid=f:63828.pdf.

    [2]
    See Pages 124-25, Social Security Disability Fraud:  Case Studies
    in Federal Employees and Commercial Driver’s Licenses, Permanent Subcommittee
    on Investigations, Committee on Homeland Security and Government Affairs,
    United States Senate, 111th Congress, August 4, 2010, http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=111_senate_hearings&docid=f:63828.pdf.

    [3]
    See Number of Beneficiaries Receiving Benefits on December 31,
    1970-2012, Disabled Workers and Dependents, http://www.ssa.gov/OACT/STATS/OASDIbenies.html; Data on DI Receipts and
    Expenditures, Disability Insurance Trust Fund Expenditures, Benefit Payments, http://www.ssa.gov/OACT/STATS/table4a2.html#outgo.

    Dr. Coburn sent the following letter to Speaker Boehner and Leader Reid:

    September 12, 2013

    Dear Speaker Boehner and Leader Reid,

                Americans are fed up with Congress’ inability to keep its promises and control spending.  Just two years ago, we committed to the taxpayers and each other to begin an era of fiscal restraint with passage of the Budget Control Act of 2011, and already efforts are underway to unravel that agreement. 

    As the only major bipartisan deficit reduction bargain in the last fifteen years, the Budget Control Act provided a ten year blue print to restrain federal spending, accepted in exchange for a $2 trillion increase in the national debt limit.  The balanced compromise reduced both defense and non-defense spending, but for only two years.  Under the bipartisan agreement, total discretionary spending in FY 2014 is capped at $967 billion.  Most of this spending would still be financed with borrowed money as the deficit for the year is still projected to be $560 billion.              

    As you know, fiscal year 2014 is the last year discretionary spending will actually be reduced as a result of the Budget Control Act.  After next year, the law allows discretionary spending to once again increase annually.  Removing the spending restrains for 2014 would, therefore, make a mockery of the agreement to restrain spending because spending would have only be reduced for one year. 

    This is an all too familiar Washington narrative that explains why our national debt is nearly $17 trillion.  Just today, the Congressional Budget Office revealed the initial House CR would exceed the current spending limits by $19 billion.  Congress cannot break its commitment to restrain spending while expecting another debt limit increase to pay for its broken promises with even more borrowed money. 

    We reject the temptation of any short term political victory that paves the way for bigger debt, bigger borrowing, and bigger government.  Therefore, we absolutely oppose any continuing resolution or appropriations legislation that would increase spending above the levels provided under the Budget Control Act.  Furthermore, if Congress cannot keep its word to control spending as agreed to in the bipartisan Budget Control Act, we will not agree to additional increases in the debt limit. We do not need another bipartisan agreement to increase spending and borrowing. 

    Sincerely,

    Tom Coburn, M.D.

    WASHINGTON – Today, Senate Homeland Security and Governmental Affairs Committee Chairman Tom Carper (D-Del.) and Ranking Member Tom Coburn (R-Okla.) highlighted a report from the Government Accountability Office (GAO) titled, “Key Federal Agencies Need to Address Potentially Duplicative Investments,” that found that a few federal agencies may have duplicative information technology (IT) investments. According to the report, up to $321 million has been lost to these duplicative programs between FY2008 and 2013.

    In drafting the report, GAO reviewed 590 IT investments throughout the three agencies with the highest levels of IT spending- the Department of Homeland Security (DHS), the Department of Defense (DOD) and the Department of Health and Human Services (HHS). Of the investments reviewed, only 12 programs throughout the agencies were identified as potentially duplicative. Since GAO conducted its review, DOD has already consolidated two programs and has expressed intent to cancel a third. GAO recommends that DHS and HHS conduct further analyses to help direct consolidation efforts and suggests that DOD develop a plan to cancel the third duplicative program.

    “Our federal government sets aside $82 billion annually for IT investment” said Chairman Carper. “With so much money on the line, it is critical that our government agencies are doing everything possible to save taxpayer moneys. An important part of this effort is to ensure that we are not investing in programs that unnecessarily overlap or are duplicative. While today’s GAO report does highlight some areas where we need to improve, it is promising that GAO found that only 12 of the 590 investments reviewed were duplicative. As I like to say, ‘the road to improvement is always under construction,’ and clearly we still have work to do to continue to improve federal IT investments and reduce duplication in IT and throughout the federal government. I look forward to continuing to work with Dr. Coburn, my Congressional colleagues and with the Administration, particularly officials from DOD, HHS and DHS, on this ongoing effort.”

    “Today’s GAO report outlines why effective oversight of the $82 billion spent yearly on IT is essential,” Dr. Coburn said.  “As the GAO report highlights, the government has failed to make gains in improving productivity in IT.  We have seen too many delayed and over-budget projects, including some that are duplicative.  Specifically, in their sample study of IT investments at DHS, DOD and HHS, the GAO found $321 million spent on duplicative projects over the last five years.  As Ranking Member of the Homeland Security and Governmental Affairs Committee, I will continue to conduct additional oversight of IT and pressure agencies to follow GAO’s recommendations to reduce unnecessary and wasteful duplication.”

    ###

    Sep 12 2013

    Dr. Coburn Praises House Passage of Bill Requiring Income Verification for Obamacare Subsidies

    Files companion bill to Senate Energy Efficiency Bill

    (WASHINGTON, D.C.) – U.S. Senator Tom Coburn, M.D. (R-OK) released the following statement today following House passage of H.R. 2775, the “No Subsidies Without Verification Act,” a bill that will require the Obama administration to have an income verification in place before doling out Obamacare subsidies. Dr. Coburn has filed a companion bill to the Senate energy efficient bill. 

    “I applaud the House, and particularly Representative Diane Black, for taking this important step to stop billions of dollars of fraudulent Obamacare payments. Obamacare, as currently written, invites fraud because it caps the amount of money the federal government can recoup from overpayments sent to Americans who are not eligible for them.  This embarrassing lack of verification means taxpayers across America will be forced to subsidize the health care of individuals who may not qualify for benefits,” Dr. Coburn said.

    “Sadly, the administration has already threatened to veto this legislation, which verifies my concerns about fraud.  If the administration was confident in its verification system they should welcome this legislation.  They obviously know their system is not adequate, yet they are prepared to defraud millions of working families rather fix an absurd ‘honor system’ that makes the pre-crash housing market look like the gold-standard of accountability. 

    “Senate Majority Leader Reid should take up the House bill and reject the administration’s justification of fraud.  I would also urge organizations dedicated to defunding, repealing and replacing Obamacare to join this effort and not give the administration tacit support with their silence. 

    “At a time when reformers are debating the best way to defund, repeal and replace Obamacare, this approach stands out as a successful path forward.  The American people want results, not rhetoric.  They are tired of gimmicky quick-fix strategies that are designed to help Washington politicians and fundraisers rather than change laws and help patients and working families.  Reformers have shown time again that Obamacare can be undermined when we unite around sound strategies.  As the non-partisan Congressional Research Service has noted, Obamacare has already been modified 19 times.  This bill can bring that count to 20,” Dr. Coburn said.

    ###

    Dr. Coburn offered the following amendments to the Energy Savings and Industrial Competitiveness Act of 2013, S.1392:

    Amendment #1867Obamacare Income Verification

    Requires Exchanges Verify Income and Eligibility Before Obamacare Subsidies Are Dispensed. Additional information here

    Amendment #1868Turn Out the Lights 

    Requires that all federal office buildings turn off their lights at the end of the day. Additional information here.

    Amendment #1869Actual Savings

    Requires the Secretary of Energy to certify that Federal energy efficiency projects are cost efficient. Additional information here.

    Amendment #1870Duplication

    Adopts GAO’s recommendations for identifying and evaluating the 94 duplicative energy efficiency programs.  Requires each affected Department to eliminate all programs that are not authorized by statute and to recommend further consolidation through legislative action. Additional information here.

    Amendment #1873 - Supply Star

    Strikes the provision relating to the establishment of the Supply Star program. Additional information here.

    Amendment #1874 - Bankruptcy

    Requires the Secretary of Energy to conduct a study to determine the number of companies that have received taxpayer assistance and subsequently filed for bankruptcy. Additional information here.

    Amendment #1875 - Energy Star

    Provides for the consolidation and greater oversight of the Energy Star program. Additional information here.

    Amendment #1930 - Data Centers

    Requires certain agencies to conduct assessments of data centers and develop data center consolidation and optimization plans. Additional information here.

    Amendment #1897 - Small Business

    Applies small business review panel provisions from the Regulatory Flexibility Act (RFA) to Department of Energy. Additional information here

    Amendment #1898 - Union Activities

    Prohibits the funding of union activities by Department of Energy employees on official federal time. Additional information here.

    In a letter to Office of Management and Budget Director Sylvia Burwell, Dr. Coburn ask OMB to urge agencies to remain fiscally vigilant as the fiscal year comes to a close.

    Updated CRS Report on Changes to the Patient Protection and Affordable Care Act/”Obamacare”

    This updated report summarizes legislative and other actions taken to repeal, defund, delay, or otherwise amend the ACA since the law’s enactment. The information is presented in four appendices.

    • Table A-1 in Appendix A summarizes the authorizing legislation to amend the ACA that has been approved by both chambers and enacted into law.
    • Table B-1 in Appendix B summarizes the ACA provisions in authorizing legislation that passed the House in the 112thCongress (2011-2012) but was not approved by the Senate. It also lists the ACA-related legislation that the House has passed to date in the 113thCongress (2013-2014), but which has not been taken up by the Senate.
    • Table C-1in Appendix C summarizes the ACA-related provisions in enacted annual appropriations acts for each of FY2011through FY2014.Also included is a brief overview of all the ACA-related provisions added to appropriations bills considered, and in most cases reported, by the House and Senate Appropriations Committees since FY2011.
    • Finally, Table D-1 in Appendix D summarizes various administrative decisions taken by HHS and the Department of the Treasury to delay implementation of specific ACA requirements by one year.

    Other recent announcements by the Administration that address ACA implementation are also listed.

     1. DHS has spent more than $35 billion on homeland security grants, but cannot measure whether we are safer from terrorist attacks.  The December 2012 report, Safety at Any Price, found that DHS has struggled to assess and measure risk, and that many grant dollars instead subsidize state and local public safety.

     2. Mission creep has expanded DHS from its original focus on counter-terrorism to become an “all-hazards” preparedness agency.  In an era of a $17 trillion national debt, high unemployment and unsustainable spending, DHS cannot afford to continue to expand its mission, particularly when it’s unclear that the agency’s original mission is being executed. Recent years have seen the department provide local police with equipment to protect the Keene Pumpkin Festival in New Hampshire, sno-cone machines in Michigan and drones in Seattle.

     3. Key aspects of DHS’s intelligence mission are failing to provide value to the federal government.  A bipartisan investigation into DHS’s fusion center program with Sen. Carl Levin found that, despite spending as much as $1.4 billion, state and local fusion centers were providing little value for the federal government’s counter terrorism mission.

    4. Despite spending as much as $90 billion on border security initiatives over the past decade, the border remains unsecure.  The Council on Foreign Relations reported that the “apprehension rate along the southwest land border between the ports of entry is likely in the range of 40 to 55 percent.” 

    5. Despite DHS’s growing responsibilities for cyber security, the Department is struggling to fulfill its cyber and information technology missions, including securing its own networks.  The DHS Inspector General reported to me that DHS has not addressed nearly four dozen recommendations for bringing the Department’s cyber security up to required standards.  A new report from the Office of Inspector General found that DHS’s “inadequate continuity and contingency planning increases the risk that the Department may not be able to respond effectively in case of an emergency or disaster.”

    6. A growing share of DHS’s budget is being spent on natural disasters, but FEMA’s process for declaring disasters is outdated and arbitrary.   The federal government is declaring roughly four times as many disasters each year than we were decades ago.  The statistical formula DHS uses to determine when to declare a disaster is unfair and has not been properly updated in nearly 30 years – giving an advantage to states with fewer people. GAO, FEMA administrator Craig Fugate, and former DHS Secretary Janet Napolitano have all called for the formula to be reworked.  Last Congress the Senate voted on a Coburn amendment to fix the formula by assuring funds only went to states truly overwhelmed by a disaster, which received bipartisan support.

    7. Despite spending $2.8 billion to secure our ports – a key component of critical infrastructure – DHS has failed to establish clear metrics for assessing and measuring our progress on port security.  Significant challenges remain to ensure adequate screening of cargo and secure access at port facilities.

    8. Despite its broad mandate to protect critical infrastructure, DHS has struggled when given a mandate to regulate chemical facility security.  Since 2007, despite spending nearly half of a billion dollars, it is not clear the Chemical Facility Anti-Terrorism Standards (CFATS) program has improved security at chemical facilities.  To date, only five percent of all covered facilities have approved security plans and no facility has undergone a compliance inspection – more than five years after the program was to be up and running.

    9. DHS struggles to manage its acquisitions effectively and efficiently.  Underneath most of DHS’ core missions lie contracts used to purchase equipment, information technology, and support services. While DHS has made progress in establishing a policy to guide acquisition management, too often we hear about poorly managed programs that fail to deliver needed capabilities to DHS’s front lines on time and on budget.  Today, the DHS Inspector General released a report that found $28 million of radio equipment collecting dust on a shelf while operators in the field faced equipment shortages.  Last year, GAO found that 16 of DHS major programs experienced cost growth of 166 percent from $19.7 billion to $52.2 billion because of DHS’ failure to provide effective management and oversight.  

    10. DHS continues to struggle to coordinate and manage its component agencies.  Despite the effort to create “One DHS,” DHS continues to struggle to manage and coordinate its component agencies.

    The Inspector General for the Department of Homeland Security issued a new report identifying millions of misguided procurement practices of DHS's radio systems. The report found that the department has no reliable way to create an inventory of existing radio systems, and component–level data is often inaccurate and incomplete. The IG report also found that without significant reforms, significant funds could be wasted on current and future radio procurement programs.  

    Findings include:

    • The IG found that Immigration, Customs and Enforcement (ICE) recorded $6.6 million worth of radio equipment in its inventory as being “in service” when in reality, the items were stored in a warehouse for 17 months.
    • Customs and Border Protection (CBP) recorded $21.5 million worth of equipment as being “active” when it was stored in a maintenance facility for 16 months. 
    Additional information available here


      

    Sep 09 2013

    Timeline: Dr. Coburn's Effort to Eliminate the Bay State Bailout

    Health Care Law Created Special Exemption for Massachusetts

    February 2012 – National Rural Health Association Voices Opposition, Expresses Concern, Over Bay State Bailout in Health Reform Law

    April 2012— CMS Regulation Confirms Dr. Coburn’s Warning of “Bay State Bailout” in the Health Reform Law

    January 2013 – North Carolina Hospital Association Supports Hospital Payments Fairness Act

    January 2013 – Coburn and McCaskill Introduce S. 183, a Bill to End Medicare Payment Gimmick in Health Reform Law

    March 2013 - Dr. Coburn introduces amendment #409 to end Bay State Boondoggle to the Senate Budget Resolution.  Additional information on amendment available here.   Amendment passed 68-31.   *Budget and amendments do not have the force of law.*

    June 2013 – Coburn and McCaskill Seek Support from Colleagues on Hospital Payments Fairness Act

    June 2013 - Oklahoma Hospital Association endorses Hospital Payment Fairness Act of 2013.

    August 2013 - Centers for Medicare and Medicaid Services (CMS) issued a rule highlighting the distortions of the Bay State Boondoggle.

    Dr. Coburn, with Senators Burr, Enzi, Grassley, Ayotte, and Thune, sent a letter to Acting Office of Personnel Management Director Elaine Kaplan regarding OPM's 2010 decision to grant the U.S. Department of Health and Human Services (HHS) “direct hire authority” after the passage of the Patient Protection and Affordable Care Act.”  

    In the letter, they outline nine issue areas with specific questions for OPM including why special authority was granted to fill 1,800 “mission critical positions” over 6 months that were “necessary for implementing the health care law," meaning HHS would have had to hire roughly 10 candidates per day in order to fill all positions.  The letter follows OPM's release of documents after Judicial Watch filed a Freedom of Information Act (FOIA) request available here.  

    Background

    • Direct-hire authority is a legal authority that the OPM can give to Federal agencies for filling vacancies when a critical hiring need or severe shortage of candidates exists. This authority effectively allows Federal agencies to hire, after public notice is given, any qualified applicant without regard to other provisions of law which would otherwise place certain restrictions on the hiring process.
    • On the date of the passage of the Patient Protection and Affordable Care Act – which became law on March 23, 2010—former OPM director John Berry’s sent a letter to Denise Wells, Deputy Assistant Secretary for Human Resources at HHS. The letter states that HHS has the authority “to fill 1,814 mission critical positions at the GS-9 through GS-15 grade levels(or equivalent) as depicted above [in the letter] nationwide. This authority is based on a critical hiring in support of the Health Care Education Affordability Reconciliation Act of 2010.” The letter is clear that “this authority will provide HHS with the means to meet hiring needs in support of the Act.”

     

    On September 5, 2013, Dr. Coburn and former Senator Joe Lieberman sent House Ways and Means Chairman Dave Chairman Camp a letter regarding the “Bipartisan Plan to Save Medicare” which they proposed two years ago.

    In the letter, Dr. Coburn and Sen. Lieberman applaud the Committee’s transparent process of using hearings on entitlement reform as a means to evaluate a variety of proposals to protect and preserve the program. 

    Enclosed with the letter the plan’s authors also enclosed:

    • A summary of their 2011 “Bipartisan Proposal to Save Medicare & Reduce Debt”
    • Draft legislative text of their proposal
    • An analysis of the effects of their proposal by the Office of the Actuary (OACT) at the Centers for Medicare and Medicaid Services (CMS).

    OACT found the Lieberman-Coburn plan would reduce Medicare outlays by more than $535 billion over a decade and keep Medicare solvent for the next several decades. The CMS Actuary also found that if the base premium increase was removed from their proposal, premiums under their plan would be lower than current law (pg. 6 of the memo). 

    August 2013

    The GAO released a study, requested by Dr. Coburn, which examined the four different types of contractors to conduct post payment claims reviews of Medicare fee-for-service (FFS) claims to identify improper payments.  The GAO found current contracting practices are inefficient, costly and not strategically aligned with CMS goals.  In the report, GAO recommends CMS determine what can be done to enhance consistency and communicate its findings and time frame for taking action while also reducing differences in requirements for contractors.  

    Breakdown of GAO report here.  

    Aug 12 2013

    Dr. Coburn to Host August Town Hall Meetings in Oklahoma

    Muskogee Location Change Announced

    (WASHINGTON, D.C.) – Today, U.S. Senator Tom Coburn, M.D. (R-OK) announced the schedule for a series of town hall meetings that will take place in August at various locations across Oklahoma. Dr. Coburn will take questions and address important issues for Oklahoma and the nation at each event.

    “I am eager to hear the concerns of Oklahomans and inform them of my legislative efforts in the Senate,” said Dr. Coburn.

    Wednesday, August 21, 2013

     

    Miami Town Hall Meeting

    2:00 p.m.

    Miami Civic Center

    129 5th Ave. NW

    Miami, OK

     

    Muskogee Town Hall Meeting

    *NEW LOCATION*

    5:00 p.m.

    Muskogee Civic Center, Room D

    425 Boston Street, Muskogee OK

     

    Thursday, August 22, 2013

    Stigler Town Hall Meeting

    8:00 a.m.

    The Eaton Hole

    504 E. Main Street

    Stigler, OK

     

    Hugo Town Hall Meeting

    12:00 p.m.

    Kiamichi Technology Center North Seminar Room

    107 S. 15th Street

    Hugo, OK

     

    Atoka Town Hall Meeting

    2:30 p.m.

    Kiamichi Technology Center Business Center

    1301 W. Liberty Rd.

    Atoka, OK

     

    Monday, August 26, 2013

     

    Shawnee Town Hall Meeting - *CANCELED*

     

    ###

    In a letter to Judge John Bates, Director of the Administrative Office of the United States Courts, Dr. Coburn asks for the AOUSC to properly allocate its resources to prevent furloughs, hearing cancelations, and case dismissals by halting non-essential conferences and excessive construction projects.  

    WASHINGTON, D.C. – Last night, the Senate Homeland Security and Governmental Affairs Committee Chairman Tom Carper (D-Del.) and Ranking Member Tom Coburn (R-Okla.) introduced the bipartisan Postal Reform Act of 2013 (S. 1486).

    The financial condition of the Postal Service has been deteriorating for years, but the 2008 economic downturn and the near universal use of the internet for communications and commerce have hastened its downward spiral. The Postal Service currently maintains an outstanding debt of over $15.9 billion and lacks the operating capital to begin repaying that debt, let alone meet congressionally-mandated payments exceeding $5 billion due to the U.S. Treasury at the end of Fiscal Year 2013.

    Congressional leaders have long called for legislation that addresses the systemic causes of the Postal Service’s difficulties, and this compromise builds on years of bipartisan, bicameral work. Without serious, long-term reform, this iconic American institution – enshrined in our Constitution – will take on more and more debt. The bipartisan Postal Reform Act of 2013 seeks to address the Postal Service’s financial challenges by helping it streamline operations and giving it new tools it can use to introduce innovative new products and generate additional revenue. It does this while preserving essential services.

    Chairman Carper said: “One year ago, the United States Postal Service defaulted for the first time in its history. As Businessweek put it: ‘The U.S. Postal Service essentially went broke today.’ The agency was – and is – facing its worst financial challenges in 200 years. Over the past year, Americans have realized the hard truth that the Postal Service is on the verge of financial collapse. If it were to shut down, the impact on our economy would be devastating. Although the situation is dire, it isn’t hopeless. With the right tools and quick action from Congress, the Postal Service can reform, right-size and modernize. The bill that Dr. Coburn and I introduced last night presents a comprehensive and bipartisan solution to the Postal Service’s financial challenges that would prevent collapse, protect millions of mailing industry jobs, and enable this critical institution to serve the American public for years to come. This bill isn’t perfect and will certainly change as Dr. Coburn and I hear from colleagues and stakeholders, including postal employees and customers. But the time to act is now. It is my hope that Congress and the Obama Administration can come together to enhance this plan in order to save the Postal Service before it’s too late.”

    Ranking Member Coburn said: “This proposal is a rough draft of an agreement subject to change that I hope will move us closer to a solution that will protect taxpayers and ensure the Postal Service can remain economically viable while providing vital services for the American people.”

    Highlights of the Postal Reform Act (PRA) of 2013:

    Pension Reforms: The PRA would require that the Office of Personnel Management (OPM) use data in determining how much the Postal Service must pay into the two federal pension programs – the Federal Employees Retirement System (FERS) and the Civil Service Retirement System (CSRS) – that more accurately reflects the amount of the Postal Service’s projected liability, in light of differences between the postal and non-postal federal workforces.  This reform is expected to reduce the amount the Postal Service pays into both FERS and CSRS and to result in a Postal Service FERS surplus.  The Postal Service would be permitted to request and receive up to $6 billion of any surplus, which could be spent to retire Postal Service debt and give it needed liquidity.

    In addition, the bill would allow the Postal Service and postal unions to bargain over the extent of new postal employees’ participation in FERS and the Thrift Savings Program (TSP).

    Health Care Reforms: The PRA would eliminate the Postal Service’s statutory retiree health pre-funding and replace it with a less aggressive 40-year amortization of the Postal Service’s retiree health liability.  This provision, combined with language allowing premiums for current retirees to come out of the account containing health care funds that the Postal Service has already pre-funded, could reduce the Postal Service’s total retiree health costs by roughly half.  Those costs could be reduced even further through the implementation of provisions in the PRA requiring that 1) health plans be created to meet the needs of postal retirees enrolled in Medicare parts A and B, some of whom currently purchase full Medicare and Federal Employees Health Benefit Plan (FEHBP) coverage; and 2) postal retirees not enrolled in Medicare be given the opportunity to do so penalty-free.  Participation in Medicare parts A and B and these new health plans would be voluntary, but these two provisions are expected to increase Medicare enrollment among postal retirees and significantly reduce the Postal Service’s long-term retiree health liabilities.

    In addition, the PRA would also allow the Postal Service and the postal unions to bargain over the creation of a new health plan for postal employees, either within or outside of FEHBP.

    Service Changes

    • The Postal Service last year proposed a service standard change for certain classes of mail that would have largely eliminated the overnight delivery of mail and led to the closure or consolidation of a significant number of mail processing plants.  The PRA would place a moratorium on service standard changes and plant closings for two years, keeping all plants open as of the date of enactment in operation for the duration of the moratorium.
    • The PRA would codify the Postal Service’s current plan to find savings in its retail operations without closing post offices.
    • The PRA would preserve Saturday delivery for at least a year.
    • The PRA would require the Postal Service to use the most cost effective means of mail delivery, requiring centralized or curbside delivery for new addresses and business addresses.  It would also require the Postal Service to seek to convert residential addresses from door delivery to centralized or curbside delivery on a voluntary basis. 

    Revenue and Innovation

    • The PRA would streamline the current rate-setting process, giving the Postal Service more authority to set prices on its own while preserving a more flexible CPI rate cap until 2016, when the rate cap would expire.
    • The PRA would give the Postal Service enhanced authority to innovate and introduce new non-postal products that take advantage of its retail and mail processing, transportation, and delivery network.
    • The PRA would authorize the Postal Service to offer services on behalf of federal, state, or local government agencies.
    • The Postal Service is prohibited under current law from shipping beer, wine, and distilled spirits.  The PRA would lift this prohibition and allow the Postal Service to deliver beer, wine and distilled spirits under the same rules as private sector shippers.

    Federal Workers Compensation Reform

    The PRA contains the Workers Compensation Act of 2013, which reforms the workers' compensation program for federal employees who are injured on the job.  The Act would bring compensation levels for older workers more in line with retirement benefits, strengthen programs for helping injured workers get back on the job, make other updates and improvements.

    ###

    July 2013

    (WASHINGTON, D.C.) – Today, U.S. Senators Tom Coburn, M.D. (R-OK) and Rand Paul (R-KY) introduced the Enumerated Powers Act of 2013. This bill gives members of Congress the procedural tools necessary to stop unconstitutional legislation. Dr. Coburn and Sen. Paul introduced the bill along with 34 cosponsors.

    “Many of our nation’s fiscal woes can be linked to Congress’s ignorance of, and refusal to follow, the clear Constitutional limitations on our power to legislate,” Dr. Coburn said.  “Our founders recognized the need for the federal government’s powers to be strictly limited – not only to ensure effective governance but to prevent unrestrained federal overreach. Limiting government is important because it liberates people and expands freedom and opportunity. Today, Americans have more government but less liberty, less economic mobility, and less disposable income. I am hopeful this legislation will correct this trend by reconnecting Congress with the enumerated powers outlined in the Constitution and codifying Congressional accountability to the Constitution.”    

    “When I ran for the Senate, one of my promises was to fight to pass an Enumerated Powers Act,” Senator Paul said. “Politicians in Washington should abide by their oath to uphold the Constitution by only legislating within the powers it gives to the federal government. I am proud to be the lead co-sponsor of Sen. Coburn’s bill to make this a reality.” 

    The Enumerated Powers Act of 2013 does the following: 

    1)      Requires each Act of Congress, bill, resolution, conference report and amendment to “contain a concise explanation of the specific authority in the Constitution” that is the basis for its enactment. 

    2)      States any legislation that abolishes a Federal activity, spending or overall power may cite the 9th or 10th Amendments to the Constitution. 

    3)      Prohibits the use of the Commerce Clause, except for “the regulation of the buying and selling of goods or services, or the transporting for those purposes, across boundaries with foreign nations, across State lines, or with Indian tribes…” 

    4)      Allows a point of order to be raised in either House of Congress for bills that fail to cite constitutional authority. 

    5)      Cites the constitutional authority to enact the Enumerated Powers Act, which falls under Article I, Section 5, Clause 2 of the Constitution, allowing each House to determine the rules of its proceedings. 

    The bill is cosponsored by Senators Ayotte (R-NH), Barrasso (R-WY), Blunt (R-MO), Boozman (R-AR), Burr (R-NC), Chambliss (R-GA), Coats (R-IN), Corker (R-TN), Cornyn (R-TX),  Crapo (R-ID), Cruz (R-TX), Enzi (R-WY), Fischer (R-NE), Flake (R-AZ), Graham (R-SC), Grassley (R-IA), Hatch (R-UT), Heller (R-NV), Inhofe (R-OK), Isakson (R-GA), Johnson (R-WI), Lee (R-UT), McCain (R-AZ), McConnell (R-KY), Moran (R-KS), Risch (R-ID), Roberts (R-KS), Rubio (R-FL), Scott (R-SC), Sessions (R-AL), Thune (R-SD), Toomey (R-PA), Vitter (R-LA), and Wicker (R-MS).    

    ###

    Dr. Coburn released a report from the Congressional Research Service regarding the potential effects of a funding lapse and related government shutdown on the implementation of Obamacare.  CRS determined funding for Obamacare would still continue even if the government were shut down.  A summary of the memo can be found here.  

    A common mistake in politics is letting the perfect become the enemy of the good and the achievable. That has never been truer than with the deficit reduction debate in Washington.

    For much of the past four years, I’ve been urging the president and both parties in Congress to pass a comprehensive deficit reduction plan — a grand bargain — that reforms our tax code, preserves our safety net programs and cuts billions in wasteful and duplicative spending. My ideal plan, as outlined in my Back in Black report, would be in the ballpark of $9 trillion in savings, which is twice what was recommended by Simpson-Bowles ($4 trillion) and more than the $2 trillion figure that is being discussed today. 

    I still believe such an agreement is both necessary and possible. The barrier has been, and continues to be, a lack of leadership in Washington. If the president, in particular, had the political will to pass a grand bargain, it could happen.

    Unfortunately, that isn’t likely in the near term. If Congress and the administration follow their usual pattern, they will do nothing until the next crisis is upon us, which will most likely be hitting the debt limit late this fall or early winter.

    Yet, there is no reason members of Congress in both parties should wait on the next crisis. We can work together and take action where we agree. We can begin to pass bills, one by one, each with bipartisan support, to begin chipping away at our $17 trillion debt, $1 billion at a time. 

    One logical starting point is President Barack Obama’s fiscal 2014 budget. His budget — while flawed — does include almost half a trillion dollars in deficit reduction proposals and entitlement reforms that I support and believe many other Republicans could support as well. From discretionary program eliminations and defense spending reduction to Medicare changes and federal retirement reforms, the president and many Republicans agree on a long list of changes that could save taxpayers more than $435 billion over the next decade.

    Many of my colleagues feel the same way and are eager to take action where we agree. Here are a few concrete steps Congress could take. 

    Sens. Jeff Flake, R-Ariz., Joe Manchin III, D-W.Va., and Angus King, I-Maine, have introduced a reform in the president’s budget that would prohibit individuals from “double dipping” unemployment benefits and disability benefits. This common-sense reform could save taxpayers more than $200 million annually. 

    Sen. Claire McCaskill, D-Mo., and I have introduced a bill expanding on an item in the president’s budget that asks wealthy seniors to pay a little more for their Medicare premiums. At a time when seniors on Medicare on average receive $3 in benefits for every $1 they pay into the program, linking premiums to income is the right thing to do, particularly when the program is going bankrupt. The president’s similar proposal could save up to $50 billion over the next decade. 

    The president’s budget also proposes using a more accurate way to adjust Social Security benefits and other federal payments for inflation. This proposal could save $230 billion over 10 years. 

    Also on the president’s list is possible savings of $5.8 billion over 10 years by making long-overdue adjustments to the fees civilians and military retirees pay in the Tricare health care system.

    Finally, among many other proposals, the president’s budget outlines billions in savings from the discretionary budget. From reducing funding for Interior’s National Heritage Areas and the EPA’s Diesel Emissions Reduction Program, to eliminating duplicative workforce programs at the Department of Labor, the president’s budget includes dozens of reductions to discretionary programs that would save taxpayers $10 billion. 

    The American people have seen that the easiest thing to do in Washington is nothing. That isn’t good enough anymore. The American people want us to act now. If Congress took action on these items, we wouldn’t solve our debt and deficit problems but we would be making progress. 

    While I’m going to continue to fight for a grand bargain that will help our economy grow to its potential, I’m not willing to let the perfect be the enemy of the good and the doable. The president’s budget contains billions in savings that should prompt bipartisan action today.

     

    WASHINGTON – Today, Senate Homeland Security and Governmental Affairs Committee Chairman Tom Carper (D-Del.), Ranking Member Tom Coburn (R-Okla.) and Committee Members Mark Pryor (D-Ark.), Rob Portman (R-Ohio), and Mark Begich (D-Alaska) introduced important legislation that would assist federal agencies in improving the disposal and management of federal buildings and facilities. The Federal Real Property Asset Management Reform Act of 2013 would help facilitate the disposal of unneeded federal property and establish a framework for federal agencies to better manage existing space in a more cost-effective manner

    “It’s been clear to me and to others for a long time now that we can get better results and save taxpayer money by improving the way we manage federal property," said Chairman Carper. "Excess and underutilized federal properties cost taxpayers billions of dollars each year in maintenance, security, and others costs. The good news is that we can solve this problem by taking some common sense steps to improve federal property management. The Federal Real Property Asset Management Reform Act of 2013 will help to reduce waste and inefficiency by requiring all federal agencies to not only maintain a comprehensive inventory of their properties, but to also take a hard look at which assets they actually need and which could be sold or put to better use. The unnecessary expenses associated with maintaining unneeded properties are the type of low hanging fruit that we need to go after in order to help reduce our federal deficit and ensure that our government is financially responsible. Fortunately, both Congress and the Obama Administration are united in their commitment to address this issue and I look forward to working with my colleagues to move this important bill forward.” 

    “Abandoned and underutilized federal properties serve little to no purpose for the government and taxpayers alike,” said Dr. Coburn.  “This bill provides the provisions necessary for agencies to liquidate such properties effectively.” 

    “We’re wasting hundreds of millions of taxpayer dollars each year on unnecessary federal property and maintenance costs, and that needs to stop,” said Senator Pryor. “This bill is a common-sense, bipartisan way we can cut our spending and secure our nation’s economic future.” 

    “Against a background of record deficits and debt, reforming the federal government’s bureaucratic real property procedures is a bipartisan no-brainer,” said Senator Portman.  “The government spends billions of dollars to maintain tens of thousands of excess or underutilized properties across the country.  This is an unnecessary drain on the public purse and we can realize major savings simply by speeding up the sale of surplus and excess property and subjecting costly government leases to greater scrutiny.” 

    “We need better management of our taxpayer dollars across our government agencies and this bill is a great first step to managing unneeded federal property,” said Senator Begich. “It’s crazy that the federal government is throwing away money on property we don’t even use which is why I’m grateful to Senators Carper, Coburn, Portman and Pryor for coming together in a bipartisan fashion to introduce this common sense bill which, instead of wasting dollars, will help us actually pay down our debt and deficit.” 

    The federal government currently owns over one million properties across the county, making it the largest property owner in the United States. In fact, every year since January 2003, the Government Accountability Office (GAO) has placed real property management on its list of "high risk" government activities, citing long-standing problems with excess and underutilized property; deteriorating and aging facilities; unreliable property data; and a heavy reliance on costly leasing instead of ownership to meet new needs.

    The Federal Real Property Asset Management Reform Act of 2013 would address vulnerabilities in current law by requiring agencies to continually evaluate their property needs and how they manage their current property inventory. Additionally, the bill establishes a pilot project to streamline the current federal real property disposal rules in order to achieve greater efficiencies within the existing disposal process.

    The legislation comes on the heels of a 2013 Obama Administration policy directive that instructs federal agencies to develop plans to restrict the growth in office and warehouse inventories and encourages increased coordination between top managers charged with managing federal property. The Federal Real Property Asset Management Reform Act of 2013 would take the directive further and provide the direction agencies need to comprehensively review existing property and determine where the government can achieve cost savings.

    Specifically, the Federal Real Property Asset Management Reform Act of 2013 would:

    • Require that each agency conduct an inventory of real property under its control, continuously survey its real property to identify excess and underutilized property, report any excess or underutilized property to the Administrator of the General Services Administration (GSA) and the Federal Real Property Council, and establish goals that will lead to a reduction of the agency’s excess and underutilized real property.
    • Establish the Federal Real Property Council (FRPC) and charge the Council with creating an annual asset management plan and establishing performance measures that will enable Congress to track progress in achieving real property goals government-wide. The membership of the FRPC will be comprised of senior real property officers from each executive agency, the Controller at the Office of Management and Budget (OMB), and the GSA Administrator. The council will be chaired by the OMB Deputy Director for Management.
    • Require the GSA Administrator to establish and maintain a single database of all real property owned by federal agencies. The Administrator is required to make the database accessible to the public at no cost within three years after the date of enactment of this bill.
    • Require agencies with independent leasing authority to submit a detailed annual report describing its leases. Although GSA is responsible for leasing property on behalf of most federal agencies, some agencies have the power to enter into leases on their own.
    • Establish a pilot program to expedite the disposal of surplus properties. This will provide the Director of OMB the authorization to dispose of up to 200 properties each year with priority going to those properties that have the highest fair market value. Under the pilot program, GSA is reimbursed for the costs of identifying and preparing a property for disposal. Eighty percent of the proceeds of any sale of property will be returned to the Treasury for debt reduction while 18 percent or the share of proceeds otherwise authorized to be retained under law will be retained by the agency that owned the property, and the remaining 2 percent will be used to fund homeless assistance grants.

    ###

    Jul 26 2013

    HATCH, GRASSLEY, COBURN WELCOME CMS ACTION TO PREVENT WASTE, FRAUD & ABUSE WITHIN MEDICARE

    CMS Announces Moratorium To Certain Medicare Providers In High-Fraud Areas

    WASHINGTON –Today, U.S. Senators Orrin Hatch (R-Utah), Chuck Grassley (R-Iowa), and Tom Coburn (R-Okla.) welcomed action taken by the Centers for Medicare and Medicaid Services (CMS) to crack down on waste, fraud, and abuse within the Medicare program. The agency announced its decision to impose a temporary moratoria on the cities of Miami and Chicago for home health providers and on the city of Houston for ambulance providers for Medicare after the Senators repeatedly called on CMS to utilize the tools provided within the Patient Protection and Affordable Care Act (PPACA) to crack down on potential fraud by certain Medicare providers.

    “While it’s certainly better late than never, it’s unfortunate that it took CMS three years to use the tools it’s had to protect seniors, who rely on Medicare, from fraud and abuse,” said Hatch, Ranking Member of the Senate Finance Committee that has oversight jurisdiction over the Medicare program.  “With CMS finally acting to crack down on fraud in high-risk areas like Miami and Houston, America’s seniors will be better protected from those wishing to game the system putting their care in jeopardy, while helping shore up Medicare’s finances.  I hope to see more action like this from CMS.  The fact is too many bad actors are preying on the largesse of these programs and we need to do a better job of stopping them.”

    “Just this week, a news story described cuts at the Health and Human Services inspector general’s office,” Grassley said.  “It worries me that the watchdog that protects the taxpayers from waste, fraud and abuse is forced to let investigations fall by the wayside.  The moratoriums are especially good news in that context.  There’s no shortage of bad actors to defraud the taxpayers, and the number gets bigger all the time, so it’s good to see the Administration at last using this new tool to fight fraud.”

    “I applaud CMS Administrator Marilyn Tavenner and her team for using authorities under current law to temporarily halt the enrollment of new Medicare providers or suppliers in key areas that are especially subject to fraud, waste, or abuse,” said Coburn.  “I am glad to see CMS follow recommendations from the Inspector General, as well as myself and colleagues, that they should use this targeted tool to protect taxpayers and beneficiaries. While reducing fraud will not solve Medicare’s broader financing challenges, using the full range of authorities and tools to reduce fraud is an important responsibility in managing the program."

    Under PPACA, CMS can impose a temporary enrollment moratorium on new Medicare providers and suppliers when the agency determines that there is a significant potential for waste, fraud, or abuse by the applicant type or geographic area. Despite repeated letters from the Senators over the past three years as well as evidence from investigations by the U.S. Dept. of Health and Human Services Office of Inspector General (HHS-OIG) that demonstrate this tool would stop Medicare fraud, this is the first time CMS has exercised its authority to impose temporary moratorium.

    ###

    In a letter to Senate Minority Leader Mitch McConnell, Dr. Coburn outlines his objects to the unanimous consent agreement to pass S. 1331, legislation to amend the Trade Act of 1974 to extend the Generalized System of Preferences (GSP) until September 30, 2015.  

    WASHINGTON – Today, Senate Homeland Security and Governmental Affairs Committee Chairman Tom Carper (D-Del.) and Ranking Member Tom Coburn (R-Okla.) introduced legislation that would provide agencies with the tools needed to improve agency coordination on anti-waste and fraud efforts and curb millions of dollars in improper payments to deceased individuals. The Improper Payments Agency Cooperation Enhancements Act (IPACE) is bipartisan legislation that builds upon improper payment laws, enacted in 2010 and 2012, that were championed by Chairman Carper. 

    “In 2011, it was reported that a Delaware man collected 28 years of Social Security payments that were meant for his deceased aunt because the federal government did not include her death in its basic records,” said Chairman Carper. “Unfortunately, stories like this are not uncommon and can too often be traced to basic errors in the way our government maintains and shares death records. Not only do these types of errors waste millions of taxpayers’ dollars annually, but they also undermine confidence in our government.  That’s frankly unacceptable, especially when this problem can be easily fixed by implementing some basic reforms. Our bill ensures that the federal government makes it a higher priority to keep track of people who have died, shares that information with key federal agencies, and ultimately prevents payments to people who are obviously no longer eligible for federal benefits and other federal payments.  By taking some long overdue and common sense steps like providing federal agencies with access to the most complete and accurate list of people who have died, we can hopefully put an end to this unacceptable practice once and for all.”

    “It is inexcusable for bureaucratic red-tape to hinder the detection of individuals who are on the government’s list of deceased beneficiaries,” Dr. Coburn said.  “This bill will improve the Social Security Administration’s management of the file while increasing real-time data sharing with other agencies to ensure the most up-to-date information is available on beneficiaries before payments are disbursed.”

    This legislation comes after a Homeland Security and Governmental Affairs Committee hearing in May that examined initiatives by the Executive Branch to reduce the improper payments made by federal agencies.  The hearing examined improper payments to deceased individuals, often due to inadequate sharing among federal agencies of basic death data maintained by the Social Security Administration (SSA).  SSA maintains the Death Master File (DMF), which contains identifying information on individuals who are reported to have died.  Most federal agencies rely on a slimmed down, incomplete, and less timely version of the DMF that is also publically available. IPACE will correct these problems by making the following changes:

    • Allowing federal agencies access to the complete Death Master File database. Under current law, only agencies with beneficiary program have access to the complete DMF. IPACE specifically allows all federal agencies to have access to the complete DMF, for program integrity purposes, as well other needs such as public safety and health.
    • Requiring use of death data to curb improper payments.  IPACE would require that federal agencies make appropriate use of the DMF in order to curb improper payments.
    • Improving the Death Master File.  IPACE establishes procedures to better facilitate the sharing of data about instances of death among federal agencies, including with SSA. Currently, there are no clear procedures for agencies, such as the Department of Defense, to share their notices of death in order to update the DMF.  IPACE also establishes new requirements for correcting the DMF when errors are detected, in order to ensure accuracy.
    • Ensure that federal agencies managing retirement programs share best practices. IPACE establishes a short-term task force to identify and share best practices for identifying deceased recipients.

    ###

    Dr. Coburn submitted a statement for the record for the nomination hearing for Alejandro Mayorkas to be Deputy Homeland Security Secretary.  

    Jul 24 2013

    BIPARTISAN GROUP OF SENATORS PERMANENTLY LOWER INTEREST RATES FOR ALL STUDENTS

    Senators facilitated passing of long-term fix to student loan interest rates

    Washington, D.C. – Today, U.S. Senators Joe Manchin (D-WV), Richard Burr (R-NC), Angus King (I-ME), Tom Coburn (R-OK), Tom Carper (D-DE) and Lamar Alexander (R-TN) announced the passage of the “Bipartisan Student Loan Certainty Act” by a vote of 81-18, which provides a long-term fix that lowers student interest rates for all students.  

    “In just a few short weeks, students will be returning to school knowing with certainty what their interest rates will be on their loans for the upcoming school year,” Senator Manchin said. “I thank my colleagues on both sides of the aisle for coming together to pass this commonsense, long-term fix that lowers rates for all of our students. With the passage of this vital, bipartisan compromise, we not only lower the interest rates on all student loans, but we are providing our students the opportunity to help lead America to a better future for generations to come.” 

    “Today is a good day for students and borrowers, for the Congress, and for the American taxpayers,” said Senator Burr. “This bipartisan solution helps ensure access and affordability for all students seeking to improve their lives through higher education.  I am very pleased that we were able to work together to come to an agreement that is fair, sustainable, and effective.”

    “Today’s bipartisan vote marks an important step forward for this institution, for our students, and for the nation. We have demonstrated to the American people that this body has the capacity to overcome partisan differences and act in accordance with the interests of those we were elected to represent,” said Senator King.  “Our legislation offers a long-term, market-based solution that lowers and caps interest rates for all students taking out a loan and finally gets Congress out of the business of setting rates. It also provides our students and their families with the financial certainty they need to plan for the costs of higher education. We were sent here to solve problems, and the negotiations that resulted in this bipartisan compromise solution exemplify exactly how Congress can and should work for the country.” 

    “I am pleased the Senate chose a permanent, affordable and market-based solution that provides stability for both students and taxpayers,” Dr. Coburn said. 

    “Today, the Senate passed a bipartisan bill that will lower students’ borrowing costs immediately,” said Senator Carper. “Additionally, it prevents rates from rising to unaffordable levels by setting reasonable caps on student loan interest rates. It also maintains valuable provisions in current law that protect ‘the least of these’ in our society, including low-income workers in Delaware and across the country. This is a smart, long-term solution that saves students money and ends the seemingly annual uncertainty that families have faced in determining how to pay for higher education. It also represents the best of the Senate: Republicans, Democrats and Independents working together to solve problems. I hope this bill, and how it was written, serves as a blueprint for even more bipartisanship to come.” 

    “This permanent, market-based plan makes students’ loans cheaper, simpler and more certain,” Senator Alexander said. “It ends the annual game of Congress playing politics with student loan interest rates at the expense of students planning their futures.” 

    The Bipartisan Student Loan Certainty Act requires that, for each academic year, all newly-issued student loans be set to the U.S. Treasury 10-year borrowing rate plus add-ons to offset costs associated with defaults, collections, deferments, forgiveness, and delinquency.  The resulting interest rates for loans taken out after July 1, 2013, would be 3.86% for subsidized and unsubsidized loans for undergraduate students, 5.41% on unsubsidized loans for graduate students, and 6.41% on PLUS loans for parents and graduate students. These rates would apply retroactively to newly issued loans taken out after July 1, 2013.  The interest rate would be fixed over the life of the loan to provide borrowers with certainty to plan for the future.  Additionally, this bill protects against the threat of unforeseen circumstances by imposing a cap to ensure interest rates never exceed 8.25% for undergraduate students, 9.5% for graduate students, 10.5% for PLUS borrowers.  The Congressional Budget Office has determined this legislation would save taxpayers $715 million over ten years. 

    To view a one-page fact sheet on details of the “Bipartisan Student Loan Certainty Act,” please click here. 

    To view a chart comparing today’s student loan laws with the “Bipartisan Student Loan Certainty Act,” please click here.

    ###

    WASHINGTON – Today, Senate Homeland Security and Governmental Affairs Committee Chairman Tom Carper (D-Del.) and Ranking Member Tom Coburn (R-Okla.) introduced legislation that would provide agencies with the tools needed to improve agency coordination on anti-waste and fraud efforts and curb millions of dollars in improper payments to deceased individuals. The Improper Payments Agency Cooperation Enhancements Act (IPACE) is bipartisan legislation that builds upon improper payment laws, enacted in 2010 and 2012, that were championed by Chairman Carper.

    “In 2011, it was reported that a Delaware man collected 28 years of Social Security payments that were meant for his deceased aunt because the federal government did not include her death in its basic records,” said Chairman Carper. “Unfortunately, stories like this are not uncommon and can too often be traced to basic errors in the way our government maintains and shares death records. Not only do these types of errors waste millions of taxpayers’ dollars annually, but they also undermine confidence in our government.  That’s frankly unacceptable, especially when this problem can be easily fixed by implementing some basic reforms. Our bill ensures that the federal government makes it a higher priority to keep track of people who have died, shares that information with key federal agencies, and ultimately prevents payments to people who are obviously no longer eligible for federal benefits and other federal payments.  By taking some long overdue and common sense steps like providing federal agencies with access to the most complete and accurate list of people who have died, we can hopefully put an end to this unacceptable practice once and for all.”

    “It is inexcusable for bureaucratic red-tape to hinder the detection of individuals who are on the government’s list of deceased beneficiaries,” Dr. Coburn said.  “This bill will improve the Social Security Administration’s management of the file while increasing real-time data sharing with other agencies to ensure the most up-to-date information is available on beneficiaries before payments are disbursed.”

    This legislation comes after a Homeland Security and Governmental Affairs Committeehearing in May that examined initiatives by the Executive Branch to reduce the improper payments made by federal agencies.  The hearing examined improper payments to deceased individuals, often due to inadequate sharing among federal agencies of basic death data maintained by the Social Security Administration (SSA).  SSA maintains the Death Master File (DMF), which contains identifying information on individuals who are reported to have died.  Most federal agencies rely on a slimmed down, incomplete, and less timely version of the DMF that is also publically available. IPACE will correct these problems by making the following changes:

    • Allowing federal agencies access to the complete Death Master File database. Under current law, only agencies with beneficiary program have access to the complete DMF. IPACE specifically allows all federal agencies to have access to the complete DMF, for program integrity purposes, as well other needs such as public safety and health.
    • Requiring use of death data to curb improper payments.  IPACE would require that federal agencies make appropriate use of the DMF in order to curb improper payments.
    • Improving the Death Master File.  IPACE establishes procedures to better facilitate the sharing of data about instances of death among federal agencies, including with SSA. Currently, there are no clear procedures for agencies, such as the Department of Defense, to share their notices of death in order to update the DMF.  IPACE also establishes new requirements for correcting the DMF when errors are detected, in order to ensure accuracy.
    • Ensure that federal agencies managing retirement programs share best practices. IPACE establishes a short-term task force to identify and share best practices for identifying deceased recipients.

    ###

    Dr. Coburn sent Finance Committee Chairman Max Baucus and Ranking Member Orrin Hatch a letter outlining 25 tax expenditures that should be eliminted, reduced, or reformed.

    (WASHINGTON, D.C.) – U.S. Senators Tom Coburn, M.D. (R-OK), Kelly Ayotte (R-NH), Jeffrey Chiesa (R-NJ), Mike Enzi (R-WY), and John McCain (R-AZ) introduced a bill to reduce travel expenses by scaling back overall spending on government-sponsored conferences, establishing attendance limitations to protect from excessive and unnecessary travel, capping the amount that can be spent on a single conference at $500,000, and requiring all conference expenses to be published online.

    “Time and time again, taxpayers are frustrated by extravagant and expensive conferences that are exposed after conferences take place,” said Dr. Coburn.  “This bill will help prevent such egregious spending from happening in the first place while forcing agencies to disclose how much they have spent on conferences."

    “With $17 trillion in debt, it’s unacceptable that federal agencies continue to waste taxpayer dollars on excessive conference expenses,” said Senator Ayotte.  “Americans deserve to know that their tax dollars are being spent wisely and efficiently, and this legislation will set strict limits on conference spending, and boost accountability and transparency.”

    "Taxpayers deserve accountability for the use of their hard earned tax dollars and we have seen far too many examples of misspent funds on lavish travel and inane conference activities,” said Senator Chiesa. “This measure will help shine a bright light on wasteful spending and raise standards for how government agencies use our money."

    “Government agencies should be required to prioritize and cut the worst first,” said Senator Enzi. “By requiring costs to be put online it gives the public an opportunity to judge for themselves how their money is being spent.”

    “Distrust in Washington is at an all time high due in part to ongoing reports of millions being wasted on conferences at federal agencies like the GSA and the IRS,” said Senator McCain.  “This common sense bill would provide greater transparency and accountability on how agencies spend taxpayer dollars.”

    Specifically, the bill:

    • Prohibits agencies from paying for travel expenses for more than 50 employees for any conference occurring outside of the United States, unless the Secretary of State certifies it is in the national interest.
    • Requires agencies to post reports on their website that include each conference, including itemized expenses such as travel costs, lodging, food, costs for scouting and selecting the location, and any other cost.  Also requires detailed information about the sponsors, location, a justification of how it relates to the agency mission, cost-benefit analysis, job titles of attendees, and other information.
    • Prohibits agencies from spending more than 80% of their total conference expenditure of 2010 for the next 4 years.  2010 was the pinnacle of excessive conference spending.
    • Requires OMB to establish guidelines for what expenses constitute travel expenses for conferences.
    • Requires agencies to publish on their website the minutes, speeches, exhibits, videos, and sponsors of conferences.
    • Prohibits an agency from spending more than $500,000 on any single conference.
    • Only allows agencies to expend funds on one conference each year for each outside group. 
    • Prevents an agency from establishing or implementing a policy that discourages or prevents selecting a conference location that is perceived to be a resort or vacation destination.

    Recent reports of outlandish conference spending include:

    • With a history of excessive conference spending, the Department of Education is planning another Las Vegas conference for December 2013 which has been estimated to cost $970,000.
    • $50 million spent by the IRS between 2010 and 2012 on 220 conferences.
    • Over $800,000 spent by the GSA in 2012 on a single conference in Las Vegas.
    • $58 million spent by the DOJ in 2012 for conferences in Indonesia, Senegal, and Northern Mariana Islands among others.

    ###

    Dr. Coburn offered the following amendments to the Transportation, Housing and Urban Development, and Related Agencies Appropriations Bill, S. 1243.

    Amendment #1750 and Modified Amendment #1750—To Prohibit Federal Funds From Paying the Salaries of Federal Tax Cheats

    Adds federal employees and other individuals (such as independent contractors), who have not paid their taxes to the list of entities prohibited from receiving funds under this bill.  Additional information here

    Supported by Citizens Against Government Waste

    Supported by Taxpayers for Common Sense.

    Amendment #1751—To Prohibit Federal Funds From Being Used for Union Activities by Federal Employees While On the Clock

    Prevents any taxpayer dollars in this bill from paying the salaries of federal employees engaged in union activities as part of their official federal position.  In 2011 the total government cost of official time was over $155 million. Additional information here.

    Supported by Citizens Against Government Waste

    Amendment #1752—Strikes Small Community Air Service Development Program Funding

    Strikes from the bill, funding for the Small Community Air Service Development Program, which received a $6 million last year despite the President’s elimination request for the 4th year in a row.  Additional information here.  

    Supported by Citizens Against Government Waste

    Supported by Taxpayers for Common Sense.

    Amendment #1753—Strikes extension of Interagency Council on Homelessness already authorized through 2015, to Prevent Further Duplication

    Currently authorized through 2015, THUD would extend the Interagency Council on Homelessness authorization through 2020. This amendment strikes this extension to provide the opportunity address duplication. Additional information here.  

    Supported by Citizens Against Government Waste

    Amendment #1754—To Prohibit Federal Funds from Being Used to Meet Matching Requirements of Federal Homeless Assistance Grants  

    One provision in the THUD bill expressly allows any other federal funds to meet a matching requirement for homeless assistance grants.  This amendment would prohibit federal funds from being used to meet the matching requirements for purposes of receiving these grants. Additional information here.    

    Supported by Citizens Against Government Waste

    Amendment #1755—Strikes Specific Exemption for Alaska, Mississippi, Iowa, and Los Angeles County from Law requiring Public Housing Authorities (PHA) to Have a Resident on their Board

    Three states and one county received a special exemption from law stating PHAs must have a resident on their boards.  The bill instead allows PHAs in these jurisdictions to create resident advisory boards.  This amendment would strike the specific exemptions for these PHAs. Additional information here.  

    Supported by Citizens Against Government Waste

     Amendment #1756— Requires all Reports to be Made Available to Congress and Non-classified Reports Made Public

    Requires all reports required in the bill to be made available to all members and the public. Additional information here.   

    Supported by Citizens Against Government Waste

    Supported by Taxpayers for Common Sense.

    Amendment #1757—Requires a Report From the Secretary of HUD on Legislative Options to Update the Community Development Block Grant Formula 

    The formula to distribute the portion of CDBG automatically doled out every year has not been updated since 1974.  This amendment requires HUD to conduct a thorough analysis of how Congress can redesign the formula to ensure the poorest areas are receiving funds. Additional information here.  

    Supported by Citizens Against Government Waste.  

    Supported by Taxpayers for Common Sense.

    Amendment #1758—Reduces funding for the Community Development Block Grant (CDBG) to Level Recommended by President - $2.8 billion

    The THUD bill levels funds the CDBG program, at roughly $3.2 billion annually.  This amendment would reduce CDBG funding by $44 million to bring it in line with the President’s proposed spending level. Additional information here.

    Supported by Citizens Against Government Waste.   

    Over the past year, many of my constituents have contacted my office asking for more information about the Department of Homeland Security’s plans for purchasing large amounts of ammunition.   Given my position on the Senate Homeland Security and Governmental Affairs Committee, I wrote a letter to Sec. Napolitano on November 13, 2012, asking for more information about DHS’s plans for ammunition purchases. 

    On February 3, 2013, the Department of Homeland Security responded to my letter.  In the interest of promoting transparency and a constructive dialogue about this issue, I am posting my letter and their response. 

    DHS Response Part 1 Here.

    DHS Response Part 2 Here.  

    Response to DHS Here

    DHS Response Here.

    WASHINGTON, D.C. – Today, U.S. Senators Joe Manchin (D-WV), Richard Burr (R-NC), Angus King (I-ME), Tom Coburn (R-OK), Tom Carper (D-DE), Tom Harkin (D-IA), Lamar Alexander (R-TN), and Dick Durbin (D-IL) introduced a bipartisan compromise, the Bipartisan Student Loan Certainty Act, to lower interest rates for 100% of borrowers who have taken out, or will take out, a new federal student loan after July 1, 2013.

    “When Democrats and Republicans work together and have a real debate on a real problem, we can come up with commonsense solutions that benefit all Americans,” said Senator Manchin. “It is refreshing that on such an important issue we stopped playing politics with our students’ future to come up with a bipartisan, permanent fix that lowers interest rates for all students, especially the poorest, while also putting in place strong protections to ensure that student loan interest rates never become unaffordable. I look forward to working on more bipartisan efforts in the future. When we put our country first, we can do the right thing.”

    “I am very pleased that we were able to come together to score a big victory for 100% of students and borrowers,” said Senator Burr.  “This bipartisan compromise puts in place a sustainable, market-based solution that ensures access and affordability for students seeking to improve their lives through higher education.  I applaud my colleagues for their hard-work and commitment to put the well-being of the American people ahead of political interests.”

    “As elected officials we have a responsibility to work with one another to move the country forward, and today I am proud to say to the American people that we have done just that by bridging the partisan divide to act in the best interests of our nation’s students,” said Senator King.  “I applaud my colleagues on both sides of the aisle for coming together to forge a long-term, market-based solution that will lower and cap interest rates for every student taking out a loan and finally get Congress out of the business of setting rates. This type of good faith, give-and-take compromise is exactly how Congress should work for the country.”

    “This compromise is a win-win for both students and taxpayers,” said Dr. Coburn.  “Tying interest rates to the market allows students to take advantage of historically low rates while ensuring taxpayers will not have to foot the bill for arbitrary rates set by Congress.   I am pleased senators agreed on a permanent, principled solution instead of a short-term political fix.”

    “This bipartisan – or really tri-partisan – compromise represents the best of the Senate and should be a roadmap for how we do business around here. Republicans, Democrats and an Independent worked together, with input from the President and his team, to solve a problem facing millions of American students and their families,” said Senator Carper.  “The product is a common sense bill that lowers student loan interest rates immediately for all students and ends the annual uncertainty that families have faced recently when borrowing for college. Simply put, it’s a good approach that will help low- and moderate-income students better afford college. It also wouldn’t have happened without the work of some of my fellow ‘recovering governors’ – Senators Manchin, Alexander and King – who consistently seek solutions over partisanship.”

    “I am pleased that this student loan compromise includes hard, front-end caps on interest rates—a feature that has historically been a part of the student loan program—to protect students and their families when interest rates rise,” said Senator Harkin, who is the Chairman of the Senate Health, Education, Labor, and Pensions (HELP) Committee. “Further, this proposal will direct the Government Accounting Office to conduct a study on the true cost of the federal student loan program, to better inform our efforts as the HELP Committee moves towards the reauthorization of the Higher Education Act. Indeed, the upcoming reauthorization of the HEA will be a historic opportunity to get a handle on runaway costs and stop the shifting of costs to students, and the HELP Committee will continue to hold hearings on these critical issues as we work to reauthorize HEA next year.”

    “This long-term, market-based solution means that interest rates on all undergraduate loans—which are two-thirds of all student loans—will be 3.86 percent this year,” said Senator Alexander.  “Rates on all other student loans will also be reduced. This saves billions of dollars for the 11 million students who will borrow money to go to college this year.”

    “This agreement will ensure students loan rates will fall below the 6.8 percent rate that kicked in on July 1,” said Senator Durbin.  “Once again we’ve shown that when both sides work together, we can reach fair and bipartisan solutions to some of the nation’s biggest issues. Now that we’ve found a way to keep student loan rates low, I hope we can return to a more basic conversation about the underlying and unsustainable cost of education in America.”

    The Bipartisan Student Loan Certainty Act requires that, for each academic year, all newly-issued student loans be set to the U.S. Treasury 10-year borrowing rate (specifically, the yield on the 10-year note as determined by the last auction held before June of each year—not the changing daily rate) plus add-ons to offset costs associated with defaults, collections, deferments, forgiveness, and delinquency.  The resulting interest rates for loans taken out this year, after July 1, 2013, would be 3.86% for subsidized and unsubsidized loans for undergraduate students, 5.41% on unsubsidized loans for graduate students, and 6.41% on PLUS loans for parents and graduate students. These rates would apply retroactively to newly issued loans taken out after July 1, 2013.  The interest rate would be fixed over the life of the loan to provide borrowers with certainty to plan for the future.  Additionally, this bill protects against the threat of unforeseen circumstances by imposing a cap to ensure interest rates never exceed 8.25% for undergraduate students, 9.5% for graduate students, 10.5% for PLUS borrowers.  The Congressional Budget Office has determined this legislation would save taxpayers $715 million over ten years.

    To learn more about the bill, click here.

    ###

    (WASHINGTON, D.C.) – Today, U.S. Senators Tom Coburn, M.D. (R-OK), Lamar Alexander (R-TN), John Barrasso (R-WY), Richard Burr (R-NC), John Cornyn (R-TX), Mike Enzi (R-WY), James Inhofe (R-OK), Johnny Isakson (R-GA), Mike Lee (R-UT),  Rob Portman (R-OH), Jim Risch (R-ID), Marco Rubio (R-FL), John Thune (R-SD) and David Vitter (R-LA) introduced the Federal Employee Accountability Act, a bill that would reduce “official time” for government employees. Under the practice of “official time”, as authorized under 1978 Civil Service Reform Act, federal employees can be paid by taxpayers to complete duties that are not related to the mission of their agency, allowing in some cases for employees to perform union-related activities – some even full time – while on federal payroll.  According to the Office of Personnel Management, in 2011, the government spent $155 million on 3.4 million hours used for “official time.”   

    “Using taxpayer dollars to finance what is often highly partisan and political full-time union work is a grievous violation of the public’s trust,” said Dr. Coburn.  “Sadly, this is a widespread problem.  Agencies like the IRS and VA have hundreds of employees on their payrolls that do nothing but full-time union work paid for by taxpayer dollars.  This bill will restore the public’s trust by ensuring federal employees – and the taxpayer funds that support them – are instead used to appropriately execute the mission of every federal agency.”  

    “Hard-working taxpayers are paying federal workers to do their official jobs – period,” said Senator Barrasso.  “This bill makes it clear that union-related activities should not be funded by the American people.”

    “The abuse of official time by federal employees to perform union-related activities on the taxpayer dime is costly, inefficient, and unfair to the American people,” said Senator Burr.  “Recent information shows that an alarming number of federal employees, including those responsible for providing vital services to our nation’s veterans, spend 100% of their time not serving the mission of the agency they work for.  This is unacceptable and a slap in the face to those veterans who sacrificed so much for the rest of us and to the American people who deserve to know their hard-earned tax dollars are put to proper use.  With our country buried in debt, this bill is a very common-sense measure to ensure that these types of wasteful practices no longer occur.”

    “We have an obligation to ensure that the money we receive from taxpayers is used only for the legitimate duties of government, not political activity cloaked under the guise of official business,” said Senator Cornyn.  “I’m proud to support this measure to end an abuse of taxpayer funds and improve government transparency.”

    “Federal workers should be paid for the work they do and not the political activity they want to do,” said Senator Enzi. “Federal agencies have a mission, and that should be the priority of their workers. The American taxpayers shouldn’t have to subsidize union activity during government work hours.” 

    “At a time when our nation faces serious fiscal challenges, it is imperative that taxpayer dollars are spent wisely and efficiently,” said Senator Isakson.  I am proud to co-sponsor the Federal Employee Accountability Act because it will go a long way in ensuring that tax dollars are used to further the mission of each respective agency and not used for causes such as union activity.”   

    “Federal Agencies like the VA need to make sure that they have all hands on deck to fulfill their missions,” said Senator Portman.  “Unfortunately, however, many agencies allow their taxpayer-funded employees to focus their time and energy on full-time political, union activities that don’t have anything to do with the official task at hand.  At a place like the VA, taxpayer dollars should be funding employees to tackle the challenges of the claims backlog and providing necessary medical care to our veterans.  Our veterans deserve nothing less than that, and this legislation will ensure that happens.”

    “It is an embarrassment that millions of federal dollars have been wasted on federal employees spending their time on union-related work,” said Senator Risch. “This legislation puts an end to these abusive practices and will put taxpayer-paid employees back to work for the America people.”

    “Hard-working taxpayers should not be footing the bill for federal employees to participate in union activities on official time,” said Senator Rubio. “It’s an abuse of government power and a waste of already scarce government resources. This bill will hold federal employees accountable and ensure that they are fulfilling their official duties instead of engaging in often partisan and political union activities on the American taxpayer’s dime.”

    “The public deserves assurances that federal employees are spending their official time working on behalf of the American people and not on partisan union activities,” said Senator Thune. “The federal government must demand better oversight of our taxpayer dollars, and ensure that civil servants are performing the responsibilities for which they were hired.”

    The Federal Employee Accountability Act would repeal the provisions that entitle federal employees to official time while providing an exception for circumstances where both unions and agencies agree the use of official time is “reasonable, necessary, and in the public interest.”  The bill would not affect federal employees’ ability to organize or have union representation in hearings. The bill is a companion bill to H.R. 107 sponsored by Representative Phil Gingrey, M.D., (R-GA).   

    ###

    In a letter to Education Secretary Arne Duncan, Dr. Coburn asks for the department to divert resources from lavish conferences - such as an upcoming Vegas junket - and other areas of low-priority spending and instead use the funds for education programs.

    Jul 10 2013

    Thune, Senate Republicans Call on President to Permanently Delay ObamaCare for All

    “…all Americans deserve permanent relief from this onerous law”

    WASHINGTON, D.C.—Senator John Thune (R-S.D.), Chairman of the Senate Republican Conference, was joined today by all 45 of his Republican Senate colleagues in sending a letter to President Obama urging him to permanently delay the implementation of ObamaCare for all Americans. Last week, the Obama administration announced that after hearing concerns from the business community, it will delay implementation of a key ObamaCare component, the employer mandate, until 2015.

    In their letter the GOP senators say to the president, “[W]hile your action finally acknowledges some of the many burdens this law will place on job creators, we believe the rest of this law should be permanently delayed for everyone in order to avoid significant economic harm to American families.”

    Joining Thune in his letter were Senators Lamar Alexander (R-Tenn.), Kelly Ayotte (R-N.H.), John Barrasso (R-Wyo.), Roy Blunt (R-Mo.), John Boozman (R-Ark.), Richard Burr (R-N.C.), Saxby Chambliss (R-Ga.), Jeffrey Chiesa (R-N.J.), Dan Coats (R-Ind.), Tom Coburn (R-Okla.), Thad Cochran (R-Miss.), Susan Collins (R-Maine), Bob Corker (R-Tenn.), John Cornyn (R-Texas), Mike Crapo (R-Idaho), Ted Cruz (R-Texas), Mike Enzi (R-Wyo.), Deb Fischer (R-Neb.), Jeff Flake (R-Ariz.), Lindsey Graham (R-S.C.), Charles Grassley (R-Iowa), Orrin Hatch (R-Utah), Dean Heller (R-Nev.), John Hoeven (R-N.D.), Jim Inhofe (R-Okla.), Johnny Isakson (R-Ga.), Mike Johanns (R-Neb.), Ron Johnson (R-Wis.), Mark Kirk (R-Ill.), Mike Lee (R-Utah), John McCain (R-Ariz.), Mitch McConnell (R-Ky.), Jerry Moran (R-Kan.), Lisa Murkowski (R-Alaska), Rand Paul (R-Ky.), Rob Portman (R-Ohio), Jim Risch (R-Idaho), Pat Roberts (R-Kan.), Marco Rubio (R-Fla.), Tim Scott (R-S.C.), Jeff Sessions (R-Ala.), Richard Shelby (R-Ala.), Pat Toomey (R-Pa.), David Vitter (R-La.), and Roger Wicker (R-Miss.).

    Dr. Coburn and U.S. Representative Charles Boustany – both practicing physicians – sent HHS Secretary Kathleen Sebelius a letter asking serious questions about “ongoing significant weaknesses in HHS’ financial management” outlined in HHS's FY2012 financial audit

    (WASHINGTON, D.C.) – U.S. Senator Tom Coburn, M.D. (R-OK) and U.S. Representative Charles Boustany Jr., M.D. (R-LA) – both physicians – sent HHS Secretary Kathleen Sebelius a letter asking serious questions about “ongoing significant weaknesses in HHS’ financial management” outlined in HHS's FY2012 financial audit.

    The Members noted, “many of these issues [had] been discussed every year in Ernst & Young’s audits,” so they found it “perplexing that they are appearing yet again in the 2012 audit report.”

    Coburn and Boustany noted HHS’s “increasingly complex duties” related to the full implementation of the Patient Protection and Affordable Care Act and noted “it is vital the Department’s fiscal management systems are sound and orderly.” They asked for HHS’s response to a number of questions, as well as a detailed corrective action plan for the issues the audit identified by July 15, 2013.

    The doctors also questioned Secretary Sebelius in 2012 regarding findings from the FY2011 HHS financial audit, and in 2011 regarding findings from the FY2010 audit. 

    ###

    In this letter to Comptroller General Gene Dodaro, Dr. Coburn asks the GAO for a full review of the IRS’ ability to monitor and oversee charitable organizations. Recent studies have shed doubt on the IRS' ability to appropriately monitor the operating standards of 501(c)(3) classified tax-exempt organizations. Dr. Coburn asks the GAO to describe the IRS efforts to ensure an appropriate selection process and investigation of these charitable entities.  

    Jul 09 2013

    How the House Can Get Immigration Reform Right

    A “walls with doors” policy could unite our nation.

    Now that the Senate has passed a flawed $46 billion immigration bill it’s time for the House to be the higher chamber and start over. Do what the Senate failed to do. Pass a bill — or series of bills — that balances the two fundamental American values at stake in this debate: openness to immigration and respect for the rule of law.

    The first task for House Republicans, I would argue, is to understand that you don’t solve a messaging or political problem with bad legislation. You solve it with good policy that honors our values, respects the rule of law, and improves people’s lives.

    President Reagan, in his farewell address, gave today’s Republicans a blueprint for how to approach immigration. Of his “shining city on the hill,” he said, “It was a tall, proud city built on rocks stronger than oceans, wind-swept, God-blessed, and teeming with people of all kinds living in harmony and peace; a city with free ports that hummed with commerce and creativity. And if there had to be city walls, the walls had doors and the doors were open to anyone with the will and the heart to get here.”

    In the House, “walls with doors” is an immigration policy that could unite our nation. But Reagan was describing something even more profound — a deep belief in American exceptionalism, which is something we don’t hear enough of today.

    America, of course, is exceptional because it is a miracle of assimilation unrivaled in human history. The fire beneath our melting pot is not our economic or material wealth, but an immaterial idea that all people are created equal and are endowed by the Creator — not the State — with certain rights. Every immigrant who longs for freedom and “comes hurtling through the darkness, toward home,” as Reagan said, makes that fire brighter and our nation stronger.

    Republicans ought to invoke these themes whenever they open their mouths on immigration. This should be natural for conservatives because our views on American exceptionalism, individual liberty, and immigration aren’t diluted by political correctness or identity politics.

    The House’s second task, I believe, is to balance an unapologetic pro-legal-immigration message with an equally emphatic emphasis on the rule of law, which is what the debate about border security is really about.

    The rule of law is critical because it is the glue that holds our nation together and guarantees the freedom that has drawn millions to our country. It says that because we’re created equal we also ought to be treated equally under the law. Unfortunately, the Senate bill ignored the rule of law. It allows the secretary of Homeland Security to waive almost every provision. That’s not the rule of law. That’s the rule of rulers.

    Some argue the border can’t be made any more secure, but the facts say otherwise. According to the Council on Foreign Relations, our border is only 40 to 55 percent secure. I also know the border is not secure based on what I learn on the Intelligence Committee, and through my oversight work as the ranking member of Senate Homeland Security and Governmental Affairs Committee — the committee that has jurisdiction over the border. For instance, I’ve been asking DHS for a report on border-security performance — and metrics for how they define security — for more than a year with no response. I also asked Secretary Napolitano for DHS’s sector-by-sector plan over breakfast a month ago. “I’ll have it for you tomorrow,” she said. I got a piece of paper, but it wasn’t a plan.

    The truth is the administration doesn’t know if the border is secure and they don’t care, and they won’t start caring until Congress and the American people make them care.

    The House would be wise to force this issue with the White House and the Senate. What the American people really want, I believe, is not so much a perfect policy solution or series of triggers that will lead to other reforms. Those decisions are important, but what the public wants is to see that we have the political will to secure the border and respect the rule of law. Once that happens, the American people will be extremely gracious and generous about supporting a pathway to legal status for the 11 million people who are here illegally. After all, the public isn’t mad at aspiring immigrants. They’re mad at Washington. And rightly so. Nothing undermines the rule of law more than politicians who pass laws they have no intention of enforcing.

    And how will the American people measure political will when it comes to the border? They’ll know it when they see it. Political will — in a security sense — is what people see every time they go through an airport. They know we are committed to stopping another 9/11. They want to see some of that zeal shifted to the border. A commitment to spend billions on border stimulus for contractors doesn’t count.

    Another way the House could communicate seriousness would be to transfer DHS dollars dedicated to the militarization of small-town America to more-pressing border-security needs. For example, why not start by shifting resources from lower-priority programs like the one that gave the town of Keene, N.H. a BearCat armored personnel carrier to patrol a pumpkin festival?

    The House could take many additional steps as well, such as improving interior enforcement. Forty percent of all people who are here illegally walked through the front door and overstayed their visas. If interior enforcement isn’t improved we’ll be passing another “reform” bill in ten years.

    Many in Washington are betting the House’s efforts on immigration will fail. I’m convinced the House will prove them wrong. With cold reason, hard facts, and a passionate defense of legal immigration and the rule of law, the House can get reform right.

    (WASHINGTON, D.C.) – U.S. Senator Tom Coburn, M.D. (R-OK) released the following statement today regarding the Obama Administration’s decision to delay the employee mandate provision of the Patient’s Protection and Affordable Care Act until 2015:

    "This decision is a stunning admission that the Affordable Care Act is unworkable. Congress should respond by repealing this deeply flawed law and replacing it with an alternative that puts patients and doctors, rather than bureaucrats, in charge of our health care system.”

    ###

    In a letter to Acting IRS Commissioner Daniel Werfel, Dr. Coburn and Congressman Phil Gingrey, M.D., ask for the agency to expound on its procedures and practices for the 200 employees that are paid by taxpayers to do union work full time.


    WASHINGTON – Large, profitable U.S. corporations paid an average effective federal tax rate of just 12.6% in 2010, far less than the U.S. statutory rate, according to a Government Accountability Office report released today by two senior senators.

    The report, requested by Sen. Carl Levin, D-Mich., and Sen. Tom Coburn, R-Okla., adds to the growing evidence that large, profitable corporations bear a dwindling share of the tax burden and that the Treasury collects far less revenue from large, profitable corporations than might be expected under the U.S. statutory corporate income tax rate of up to 35%.

    “Today’s GAO report provides more stark evidence, if any is needed, that large, profitable U.S. corporations as a whole are not paying their fair share in taxes,” said Levin. “When some U.S. corporations use unjustifiable loopholes and offshore gimmicks to avoid paying Uncle Sam, their tax burden is shifted onto hardworking American families and small business. Today’s GAO report quantifies just how much of the corporate tax burden has been shifted onto other taxpayers: America’s large, profitable corporations are now paying a lower tax rate than our teachers and firefighters.”

    “This report underscores the need for comprehensive tax reform,” said Coburn. “Creating giveaways and loopholes for corporations is both anti-competitive and unfair to working families. Every tax earmark for a corporation is effectively a tax rate increase for middle and lower income Americans. An individual’s or corporation’s tax rate shouldn’t be dependent on their ability to hire a tax lobbyist. It’s especially wrong to ask families who are struggling to make ends meet to subsidize special breaks for corporations. We would be better off with a code that eliminated these loopholes so we can lower rates for both corporations and individuals.”

    Levin and Coburn requested the report in 2012, when they were chairman and ranking member, respectively, of the U.S. Senate Permanent Subcommittee on Investigations. In response, GAO conducted a year-long study examining how effective tax rates are typically calculated, and developed a new methodology using corporate tax returns. The GAO compiled the tax return data from these large corporations for tax years 2008 through 2010, and compared it with the income reported on financial statements filed with the Securities and Exchange Commission. Average corporate effective tax rates are generally computed as the ratio of taxes paid or tax liabilities accrued in a given tax year over the net income declared by the corporation during that same year.

    GAO found that, on average, large, profitable U.S. corporations paid U.S. federal income tax amounting to just 12.6% of their worldwide income, a tax rate which is only about one-third of the U.S. statutory rate. GAO also found that the relatively low effective tax rate paid by U.S. corporations did not substantially increase when other taxes paid by those corporations were taken into account. GAO found that, in 2010, adding foreign, state, and local taxes to federal income taxes increased the average effective tax rate of large, profitable U.S. corporations by about 4 percentage points to 16.9% of their worldwide income. That composite tax rate is still less than half the U.S. statutory rate.

    In calculating these rates, GAO used tax data taken from M-3 tax returns filed with the Internal Revenue Service (IRS) by corporations with at least $10 million in assets. Using actual tax return data enabled GAO to develop more accurate figures for the taxes paid by large U.S. corporations than studies using tax information provided in their financial statements. GAO noted that the amounts reported in the corporate tax returns were, on the whole, lower than the tax liabilities reported in the corporate financial statements.

    GAO also noted that some studies calculating effective tax rates included unprofitable corporations in their analysis, but explained that “[t]he inclusion of unprofitable firms, which pay little if any actual tax, can result in relatively high estimates because the losses of unprofitable corporations greatly reduce the denominator of the effective rate” and “do not accurately represent the tax rate on the profitable corporations that actually pay the tax.” GAO calculated that when unprofitable corporations were included in its data, the average effective federal tax rate rose from 12.6% to 16.6%, because those corporations had lost $315 billion and thereby reduced the overall net income against which the corporate tax payments were compared. The resulting tax rate, however, overstated the effective tax rate actually paid by large, profitable U.S. corporations.

    GAO’s finding that corporations pay far below the U.S. statutory rate is consistent with other work performed by the Permanent Subcommittee on Investigations. Over the past ten years, the Subcommittee has examined a number of the tax loopholes and gimmicks used by some profitable U.S. corporations to avoid paying U.S. taxes. Last year, for example, a Subcommittee hearing showed how Microsoft used tax gimmicks to shift 47 cents of every dollar in U.S. sales revenue offshore and, over a three year period from 2009 to 2011, avoided paying taxes on income exceeding $20 billion. Earlier this year, a Subcommittee hearing showed how Apple Inc. created three offshore corporations that supposedly had no tax residence anywhere in the world, funneled over $74 billion in profits through them over a four year period from 2009 to 2012, and paid no U.S. tax on any of those profits.

    The GAO report is also consistent with other studies demonstrating that large, profitable corporations are often able to minimize, if not entirely avoid, paying U.S. income taxes. For example, a 2012 study by Citizens for Tax Justice found that, over a recent three year period, 30 of the largest U.S. multinationals, with more than $160 billion in profits, paid no federal income taxes at all.

    Data show that corporate income tax revenue has accounted for a smaller and smaller share of federal tax receipts over the years. According to the Congressional Research Service, the share of corporate income taxes has fallen from 32% to just 9% of federal tax revenue, a decline charted in the GAO report. At the same time their portion of tax receipts has fallen, U.S. corporate profits have reached an all-time high, reflecting the highest percentage of all U.S. income since World War II. Despite corporations’ growing share of income, GAO reported that in 2012, corporate income taxes contributed only about $242 billion to federal tax receipts, while individual income taxes contributed nearly five times more at $1.1 trillion.

    Multinational corporate tax avoidance has become so widespread and damaging that it has attracted international condemnation. At a G8 summit in June, global leaders, including President Obama, criticized corporate tax dodging and committed to making multinational corporations disclose the taxes they pay on a country by country basis, and to stop allowing companies to shift profits across borders to avoid taxes.

    “Some U.S. multinational corporations like to complain about the U.S. 35% statutory tax rate, but what they don’t like to admit is that hardly any of them pay anything close to it,” said Levin. “GAO has calculated that the average corporate effective tax rate of large, profitable U.S. corporations is less than 13%, about a third of the statutory rate. The big gap between the U.S. statutory tax rate and what large, profitable U.S. corporations actually pay is due in large part to the unjustified loopholes and gimmicks that riddle our tax code. When Congressional leaders talk about tax reform, closing egregious corporate loopholes, particularly those that enable corporations to shift income and intellectual property to offshore tax havens, ought to be at the top of the list. Congress also needs to jettison the idea of revenue neutral corporate tax reform which would just bake into the tax code all the revenues lost to multinational corporation’s current tax avoidance. Any tax reform worth doing has to ensure that profitable multinational corporations pay the same or a larger tax rate than middle class American families.”

    The GAO report is entitled, “Corporate Income Tax: Effective Tax Rates Can Differ Significantly from the Statutory Rate,” No. GAO-13-520

    June 2013

    (WASHINGTON, D.C.) – U.S. Senator Tom Coburn, M.D. (R-OK) released the following statement today regarding the passage of S. 744:

    “This bill is a historic missed opportunity for the United States Senate.  It is a $48 billion border stimulus package that grants amnesty to politicians who want to say they are securing the border when in fact they are not.  I very much wanted to support an immigration reform proposal that balances our fundamental American values of legal immigration and the rule of law.  Sadly, this bill fails that test.  

    “Speaker Boehner and House Republicans now have all the justification they need to start over.  I would encourage the House to use President Reagan’s view of immigration as a blueprint.  In his farewell address Reagan described what he saw when he talked about America as the ‘shining city on the Hill.’ 

    “Reagan said, ‘it was a tall, proud city built on rocks stronger than oceans, wind-swept, God-blessed, and teeming with people of all kinds living in harmony and peace; a city with free ports that hummed with commerce and creativity.  And if there had to be city walls, the walls had doors and the doors were open to anyone with the will and the heart to get here.’ 

    “‘Walls with doors’ is an immigration policy that can unite our nation.  But, today, Democrats sound like they want only doors; Republicans only walls.  The truth is we have neither.  We have chaos.  

    “House Republicans have a chance to be the higher chamber and get reform right.  They should first remind the public that America is exceptional because it is a miracle of assimilation unrivaled in human history.  The fire beneath our melting pot is not our economic or material wealth, but an immaterial idea that all people are created equal and are endowed by the Creator – not the State – with certain rights.  Every legal immigrant who ‘comes hurtling through the darkness, toward home,’ as Reagan said, makes that fire brighter and our nation stronger.  

    “The House also has an obligation to defend the rule of law, which is what the debate about border security is really about.  According to the Council on Foreign Relations, our border is only 40 to 55 percent secure.  At the same time, under the Senate bill, illegal immigration will drop by only 25 percent according the Congressional Budget Office.  Meanwhile, more than 40 percent of all people who are currently here illegally came through the front door and have overstayed their visas. 

    “The rule of law is the glue that holds our nation together and it guarantees the freedom that has drawn millions to our country.  As a nation, we have an obligation to our citizens – and to legal immigrants – to uphold the rule of law and ensure the process is fair to all.  Unfortunately, this bill is full of holes as far as the rule of law is considered.  It is written so that the Secretary of Homeland Security can waive almost every portion of it.  That’s not the rule of law.  That’s the rule of rulers. 

    “The House can, and must, do better.  But we should be precise about what the problem is.  Oklahomans and people across this country aren’t mad at illegal immigrants.  They’re mad at Washington.  And they are right to be angry.  Politicians who pass laws they have no intention of enforcing do more to undermine the rule of law than a Guatemalan father of four who crosses the border twice a year to help feed his extended family.  We can’t welcome everyone, but we should be delighted people want to come to this country, and we should do everything in our power to treat aspiring Americans fairly and with dignity.

    “I filed 19 amendments to improve this bill, including amendments to help secure the border and increase interior enforcement.  Unfortunately, those amendments were not considered.  The House now has an opportunity to give the American people the debate they want and deserve.” 

    ###

    Jun 27 2013