[HEALTHCARE] 'Testimony Before the Subcommittee'
'Statement of Jennifer Jackson
General Counsel and Vice President, Clinical Services, Connecticut Hospital Association
on behalf of the American Hospital Association
Testimony Before the Subcommittee on Oversight
of the House Committee on Ways and Means
Hearing on the Year 2000 Computer Problem
May 7, 1998
Madam Chairwoman, I am Jennifer Jackson, General Counsel and Vice President, Clinical Services, at the Connecticut
Hospital Association. I am here on behalf of the American Hospital Association (AHA), which represents nearly 5,000
hospitals, health systems, networks, and other providers of care.
We appreciate this opportunity to present our views on an issue that is of critical importance to our members and the patients
they care for: the potential for the "millennium bug" -- the inability of computer chips to recognize the Year 2000 -- to
interrupt the smooth delivery of high-quality health care. The AHA and its members are committed to taking whatever steps
may be necessary to prevent potential Year 2000 problems from affecting patient care.
Hospitals and health systems operate seven days a week, 24 hours a day. Their doors are always open because the people
they serve trust that they will be there whenever the need arises. Our number one concern is the health and safety of our
patients, and that is why I am here.
Hospitals and health systems face the same potential problems as most other institutions. Cellular phones, pagers, security
systems, elevators -- all could be affected by Year 2000 problems. However, hospitals are special places that also rely daily
upon unique medical devices and equipment. We are concerned about the potential impact of Year 2000 computer problems
on patient safety -- and hospitals, health care providers and their associations cannot reduce, let alone eliminate, that risk by
themselves. We need your help and cooperation, and that of the federal agencies that regulate the health care field: namely,
the Food and Drug Administration (FDA) and the Health Care Financing Administration (HCFA).
In particular, we need the federal government to exercise its authority in this area -- now. We need the federal government
to create an atmosphere in which everyone involved in the health care field will view the full and timely disclosure of Year
2000 computer problems not only as diligent and prudent behavior -- the right thing to do -- but also as mandatory conduct.
One of our primary concerns has to do with potentially non-compliant medical devices and equipment. Microchips (or
microprocessors) that use date-sensitive logic are embedded in many medical devices, and we need to find out whether
those devices will be affected by the date change to the Year 2000, and, if so, how we can fix them to avoid an interruption
or other malfunction. The manufacturers of these devices are the best and, and in some cases, the only source of this
information. Assuming that prudent medical device and equipment manufacturers are engaging in Year 2000 testing, we
need to know what they are discovering, especially if they are uncovering problems. Here lies the heart of our concern.
While we as health care providers can ask manufacturers to disclose Year 2000 information to us, we cannot force them to
do so. We do not have the legislative or regulatory authority to compel disclosure. We believe that is a job for Congress and
the FDA.
The Role of AHA and State Hospital Associations
Hospitals and health systems are trying to do their part. Across the nation, more and more hospitals are preparing for the
date change, and making a commitment to take all appropriate steps to avoid any disruption in patient care. Continuing a
tradition of partnership in addressing issues that affect our mutual members, the AHA and the nation's state hospital
associations are working together to inform and educate hospitals and health systems about the Year 2000 issue.
We are committed to ensuring that our members are aware of the dangers of the millennium bug. We can make sure they
have the latest information on what their colleagues and other organizations are doing to address the problem. And we can
help them learn about solutions that can help them.
Our State Issues Forum, which tracks state-level legislative and advocacy activities, is hosting biweekly conference calls
dedicated entirely to the Year 2000 issue. On these calls, information is shared among and between states and AHA staff. A
special AHA task force on the Year 2000 problem has been drawing up specific timelines for action to make sure our
members get the latest information and know where to turn for help.
Articles are appearing regularly in AHA News, our national newspaper, in Hospitals and Health Networks, our national
magazine for hospital CEOs, in Trustee, our national magazine for volunteer hospital leadership, and in several other national
publications that are published by various AHA membership societies. Several of these societies, such as the American
Society for Healthcare Engineering and the American Society for Healthcare Risk Management, are deeply involved in
helping their members attack the millennium bug in their hospitals.
In addition, the AHA Web site has become an important clearinghouse of information on the Year 2000 issue, including links
to other Web sites that also have information that can help our members.
The Role of the Food and Drug Administration
When it comes to medical devices, however, our efforts are not going to be sufficient to solve the problem, unless the
manufacturers cooperate fully and quickly. While we anticipate that the number of devices that are affected may be limited,
it is critical that accurate and thorough information be available from manufacturers. Health care providers must inventory
their thousands of devices and pieces of equipment. But information about whether these devices are Year 2000-compliant
-- that is, whether or not they will be affected by the date change -- must come from the manufacturers. The FDA has a key
role to play in this area.
The Center for Devices and Radiological Health (CDRH), the arm of FDA responsible for regulating the safety and
effectiveness of medical devices, has taken a number of steps to ensure that manufacturers of medical devices address
potential Year 2000 problems. We commend the center for its actions. Dr. Thomas Shope, who is heading FDA's efforts,
has been very receptive to our concerns. We believe that current regulations allow the FDA to require manufacturers of
medical devices to perform Year 2000 testing and report adverse results. We urge that FDA be given whatever resources or
support it may need from Congress to exercise its enforcement authority in this area.
The Role of the Health Care Financing Administration
On average, America's hospitals and health systems receive roughly half of their revenues from government programs like
Medicare and Medicaid. If that much revenue were to be suddenly cut off, hospitals could not survive, and patient care could
be jeopardized. Hospitals would not be able to pay vendors. They would not be able to purchase food, supplies, laundry
services, maintain medical equipment -- in short, they would not be able to do the job their communities expect of them. All
this would occur even as hospitals and health systems faced the substantial costs of addressing their own Year 2000 system
needs.
HCFA must make sure its contractors have taken steps to ensure that their performance will not be interrupted by Year
2000 problems caused by the millennium bug. HCFA should make readily available its work plan for bringing the contractors
into compliance and aggressively monitor their efforts. Letting the providers know what changes may be required of them is
also important. This would allow both providers and contractors to prepare simultaneously and ensure that their systems are
compatible.
Even if all contractors express confidence that their payment mechanisms will not be affected by the millennium bug, the
possibility remains that unforeseen problems could crop up. Therefore, HCFA should establish a contingency plan in case
contractors' payment mechanisms somehow fail at the turn of the century.
Medicare beneficiaries' health care needs will remain constant, regardless of whether we are prepared for Year 2000
problems. If carrier and fiscal intermediary payment systems are clogged up by the millennium bug, hospitals' ability to
continue providing high-quality health care could be severely affected. A system to provide periodic interim payments, based
on past payment levels, is one way that this could be done. It would ensure that hospitals have the resources necessary to
care for Medicare patients.
And let me add that Medicare is certainly not the only payer for hospital services. Similar payment delays could occur if
private health insurers and, in the case of Medicaid, individual states, have not addressed their own Year 2000 problems. The
federal government has the power to prevent this from happening, and we urge you to use that power.
The Role of Congress
As I have described, health care providers and the associations that represent them are devoting significant time, resources
and energy to preventing potential Year 2000 problems from affecting patient safety. It is essential that we all look for ways
to help prepare America's health care system for the turn of the century, and Congress can play an important role. Your
attention to this issue, through hearings such as this, reflects your understanding of the gravity of the situation.
We ask you to help America's health care system avoid Year 2000 problems by taking several steps that relate to the issues
I have described:
Congress should appropriate whatever funds are necessary for the FDA to ensure that manufacturers of medical
devices investigate and correct Year 2000-related problems in their products, and report the results in a timely fashion
to the FDA and to the users of their products.
Congress should enact some form of immunity from liability for health care providers that have taken steps to prevent
Year 2000 problems from affecting patient care -- for example, relying on the FDA's data base of medical devices
and equipment for information about Year 2000 compliance. To a great extent, hospitals must rely on manufacturers
of medical equipment and devices -- and on vendors providing other systems and products -- to disclose whether a
Year 2000 problem may arise, and how to correct the problem. In addition, some products and systems may have
been purchased by hospitals years ago, before the Year 2000 date change became a consideration. Providers should
not be liable for damages for the Year 2000 limitations of those products and systems.
Congress should authorize the use of periodic interim payments under the Medicare program. These payments, based
on past payment levels, should be implemented to ensure adequate cash flow for providers in case carrier and fiscal
intermediary payment systems fail due to the date change.
Madam Chairman, the Year 2000 issue will affect every aspect of American life, but few, if any, are as important as health
care. America's hospitals and health systems, their state associations, and the AHA are partners in the effort to prepare for
the Year 2000. We encourage Congress and our federal agencies to work with us as well. Together, we can ensure a
smooth -- and healthy -- transition into the new millennium.
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