WASHINGTON - Sen. Chuck Grassley of Iowa has asked each state for information to help determine whether the states and the federal government are conducting enough oversight of their rate-setting for Medicaid managed care plans.

"In light of the billions of dollars already spent on Medicaid, including managed care, and the planned expansion of Medicaid, it's important to look at whether states are setting their managed care payment rates appropriately and in keeping with federal law," Grassley said. "If the payment rates are out of whack, and scrutiny is lacking, Medicaid money could be ill-spent to the detriment of vulnerable beneficiaries and the taxpayers.  The risk could be especially high when Medicaid provider payment rates are boosted to match higher Medicare rates for two years as Medicaid is expanded under the new federal health care law."

Grassley's inquiry comes after the Government Accountability Office in 2010 found inconsistent scrutiny from the federal government of state rate-setting in this area.  GAO cited two states - Tennessee and Nebraska - as examples of those that received inadequate oversight from the federal Centers for Medicare and Medicaid Services.  Now, the state of Minnesota and its contractor non-profit health plans are drawing scrutiny in the state for what some analysts consider high operating margins. States are required to set rates for Medicaid managed care that are actuarially sound, but it's unclear if the requirement is clearly defined or enforced.

Grassley wrote in his letter to each state, citing the GAO report, "In the 18 months since that report was issued, I have seen nothing to convince me CMS or the states have improved in their ability to confirm that managed care entities are appropriately and correctly reimbursed for the services provided. If an entity is paid too little, the access to and quality of care provided to beneficiaries is jeopardized.  If an entity is paid too much, scarce Medicaid resources are diverted away from providing services to beneficiaries."

Grassley's letter includes questions such as whether states have an independent audit requirement for managed care entities and if so, whether the audit entails certain elements; for a list of all managed care entities operating in the state and an accounting of audit occurrences and results; the state's definition of allowable medical costs under the managed care contracts; and whether states have received any guidance from CMS or sought guidance from CMS on Medicaid managed care rate-setting.

The federal government will spend nearly $4.5 trillion on Medicaid over the next decade.  That's only the federal share.  State governments spend additional, significant amounts of money on Medicaid.  "Every dollar that's spent improperly doesn't help a Medicaid beneficiary," Grassley said.  "Getting a handle on managed care payment rates is necessary for the program's bottom line."

The new federal health care law boosts federal Medicaid payments to primary care physicians for two years, from Jan. 1, 2013, to Dec. 31, 2014.  For that period, the doctors will receive Medicare payment rates, which are higher than Medicaid payment rates.  At the same time, Medicaid programs and providers will cover more patients, as required under the health care law.

A copy of Grassley's letter to each state is available here.  The letters are identical.  The 2010 GAO report is available here.

Documentation Will Support Request for Federal Assistance

SPRINGFIELD - March 1, 2012. Governor Pat Quinn today asked the Federal Emergency Management Agency (FEMA) to assist with damage assessments in several Southern Illinois counties devastated by tornadoes and severe storms early Wednesday morning. The assessments, which will begin on Monday, will provide the documentation necessary to support a request for federal assistance.

"I've seen the destruction firsthand and it is critical that we get needed resources to our impacted communities right away," Governor Quinn said. "We must do everything possible to expedite this process and jumpstart our recovery in Southern Illinois."

Personnel from FEMA, IEMA, the U.S. Small Business Administration (SBA) and local emergency management agencies will begin assessing damage to homes and businesses on Monday. The assessments, which are expected to be completed by the end of the week, will be conducted in Gallatin, Massac, Perry, Pulaski, Randolph, Saline, Union and Williamson counties.

"We'll work closely with FEMA to complete the damage assessments as quickly as possible," said Jonathon Monken, director of the Illinois Emergency Management Agency (IEMA).  Monken said IEMA will have staff in the area over the weekend to meet with local officials in preparation for the damage assessments.

Immediately after surveying the damage and meeting with residents, local officials and first-responders in Harrisburg on Wednesday, Governor Quinn issued a state disaster proclamation for the southern third of Illinois. The declaration ensures that state resources and personnel are available to assist with response and recovery efforts.  A state disaster declaration is also needed in order to request federal assistance.

The State Emergency Operations Center (SEOC) in Springfield remains activated to coordinate state assistance to the affected areas. Representatives from several state agencies, including the Illinois Department of Transportation, Illinois State Police, Department of Natural Resources, Department of Central Management Services, Illinois Commerce Commission, Illinois Department of Public Health, Illinois Department of Corrections and Illinois Emergency Management Agency, are stationed at the SEOC to manage requests for assets, personnel and resources from their departments.

Friday's weather forecast for Southern Illinois calls for the potential for more severe storms, and the state is encouraging people to take steps now to prepare. In addition to an emergency preparedness kit stocked with bottled water, non-perishable food, flashlight, batteries and a first aid kit, Monken said a NOAA weather alert radio is a critical preparedness tool. The radios receive watches and warnings 24 hours a day and can alert people to approaching danger in time for them to get to a safe place.

More information about weather alert radios and severe weather preparedness is available on the Ready Illinois website at www.Ready.Illinois.gov.

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Proposal strengthens information sharing and encourages private sector innovation

Washington, DC - U.S. Senators John McCain (R-AZ), Kay Bailey Hutchison (R-TX), Chuck Grassley (R-IA), Saxby Chambliss (R-GA), Lisa Murkowski (R-AK), Dan Coats (R-IN), Ron Johnson (R-WI), and Richard Burr (R-NC) today introduced the Strengthening and Enhancing Cybersecurity by Using Research, Education, Information, and Technology Act (SECURE IT), their proposal to protect and secure our nation against cybersecurity attacks.

"The SECURE IT Act strengthens America's cybersecurity by promoting collaboration and information-sharing, updating our criminal laws to account for the growing cyber threat and enhancing research programs to protect our critical networks," said Senator John McCain. "This legislation will help us begin to meet the very real threat of cyber attack."

"We are all in agreement that we need to make our nation's cybersecurity a top priority. I believe we have come up with a strong common sense approach that will help prevent the spread of cyberattacks from network to network and across the Internet, by removing barriers to sharing information about threats, attacks, and strategies for improvement," Senator Hutchison said.  "Our bill focuses on giving businesses the tools they need to protect themselves from the looming threat of cyber criminals, and increased requirements for notification of threats to federal agencies."

"As our nation faces increasing cyber attacks in a critical economic environment, we must ensure that the private sector has the authority it needs to defend its own networks and share cyber threat information to prevent future attacks," Senator Chambliss said. "Now is not the time for Congress to be adding more government, more regulation, and more debt - especially when it is far from clear that any of it will enhance our security. Our bill offers the right solution to improving our nation's cybersecurity by encouraging collaboration, investment, and innovation."

"Our bill represents a new way forward in protecting the American people and the country's cyber infrastructure from attack.  It's a bill that can be supported by all partners that have an interest in cybersecurity. Instead of the heavy hand of the government, our approach promotes information sharing and keeps the taxpayers' wallets close," said Senator Grassley.

"Rather than arming Homeland Security with expansive new regulatory authority over every sector of our economy, the SECURE IT cyber bill we've introduced today emphasizes a partnership approach between the government and private entities. By focusing on those areas like information sharing where bipartisan agreement is achievable, we can tackle the cyber issue in a meaningful and constructive way," said Sen. Murkowski.

"After September 11, we broke down the barriers to information sharing and provided our intelligence and law enforcement professionals with the tools they need to keep us safe.  Today, we must break down similar barriers that exist in cyber security to respond to the increasing number of attacks against private companies and the federal government," said Senator Coats. "The SECURE IT Act will enable robust information sharing without creating costly layers of government bureaucracy or imposing new regulatory burdens on American businesses."

"This bill recognizes that industry is at the center of any solution. It's a sensible step forward that allows industry to invest in innovation and job creation rather than compliance. Imposing a costly and bureaucratic regulatory regime is the wrong approach to national security. New regulations will slow down innovation and investment while companies wait years for the government to introduce outdated standards," said Sen. Johnson. "The regulatory process simply cannot keep up with the rapid pace of technology."

"Cyber security is essential to our national security, and this bill takes a step in the right direction to ensure that our nation has the proper defenses in place to address threats to our nation's systems and infrastructure.   This bill takes fiscally responsible measures to protect against cyber threats by enhancing research and development, updating enforcement tools and penalties to reflect current threats, and promoting voluntary information sharing between the public and private sector without creating unnecessary bureaucracy or regulations," said Senator Burr.

Co-sponsors of the proposal are U.S. Sens. John McCain, Ranking Member of the Senate Armed Services Committee, Kay Bailey Hutchison, Ranking Member of the Senate Commerce, Science, and Transportation Committee, Chuck Grassley, Ranking Member of the Senate Judiciary Committee, Saxby Chambliss, Vice Chairman of the Senate Select Committee on Intelligence, Lisa Murkowski, Ranking Member of the Senate Energy and Natural Resources Committee, Dan Coats, Ranking Member of the Senate Appropriations Subcommittee on Homeland Security, and Ron Johnson, Ranking Member of the Senate Homeland Security Subcommittee on Oversight of Government Management, the Federal Workforce, and the District of Columbia, and Richard Burr, Ranking Member of the Senate Veterans Affairs Committee.

The SECURE IT Act will:

·         Improve cybersecurity by collaborating with industry and eliminating barriers to enhanced information sharing.

·         Create expedited information sharing for private sector using existing structures and reporting relationships.

·         Require federal contractors who provide telecommunications or cybersecurity services for the federal government to report to the government cyber threat information related to those services.

·         Strengthen criminal statutes for cyber crimes.

·         Update the Federal Information Security Management Act (FISMA) and preserve the roles of the National Institute of Standards and Technology (NIST) and the Department of Commerce in disseminating security standards for the federal government.

·         Leverage and strengthen existing programs in cybersecurity research and development.

Here is a copy of the text of Grassley's statement at today's press conference.

The group you see here today saw a need to develop cybersecurity protections that focused on avoiding new federal government bureaucracies, reforming existing programs, and not adding additional, burdensome regulations that may stifle innovation and growth in the private sector.

We felt the best approach was to focus on strengthening Cybersecurity defenses. We do this by coordinating the public and private sectors to work together.  Creating a collaborative partnership between the private sector and the federal government will foster an information sharing system that helps detect, eliminate, and prevent cyber threats.  Our legislation is something that all partners involved in protecting our cyber networks can fully stand behind.

As the Ranking Member of the Judiciary Committee, I have focused my involvement on the criminal law provisions, legal barriers to information sharing, civil liberty and privacy protections, as well as whistleblower protections.

Our bill will break down the legal barriers, such as antitrust and liability issues.  In the past, these barriers prohibited business and industry from sharing cyber threat information with the government or industry partners.  The bill includes provisions to ensure that confidentiality and personal privacy are engrained in the information sharing.  It also includes a provision ensuring that no preexisting whistleblower protection law is changed by this legislation.  We also update criminal statutes and streamline the existing, confusing penalty structure in the Computer Fraud and Abuse Act.  And, it reins in prosecutions.  These prosecutions have raised concerns by advocates on both sides of the political spectrum.  If left unchanged, they could lead to average citizens being prosecuted as federal felons.

Beyond the Judiciary Committee provisions, and very importantly, our legislation adheres to our core principle of keeping the government's regulatory reach out of the private sector.  We avoid complicated regulatory regimes that will stifle innovation and job growth.

Our approach has been laid out for many months.  It achieves consensus and can gain the support of many Senators.

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