July 23, 1998

Thank you Mr. chairman. I believe that this is a very important hearing and I appreciate that you've scheduled it early in the special committee's oversight of the readiness of the nation to meet the year 2000 challenge.

There's no sense in beating around the bush: the question that everyone wants answered is: "Are people going to die as a result of year 2000 complications in the medical industry?" To be honest, I don't think so. But its entirely possible that millennium conversion could put the health care industry into intensive care.

The health care industry faces significant year 2000 challenges, which could result in significant disruptions in medical service across the nation. As I said at our hearing on the utility industry, we're no longer talking about whether there will be any disruptions, but we are talking about how severe those disruptions will be.

 While I am very hesitant to say that these disruptions will be life-threatening, there is a reasonable chance that they will compromise the quality and extent of patient care in all parts the country.  My concerns are based upon three factors that I hope will be addressed in some detail today:

• First, there is a serious year 2000 problem for all sorts of medical devices, from diagnostic tools to dialysis machines.  I am deeply disturbed by the fact that instead of taking steps to deal with this problem, the medical device industry, as a whole, seems to be exacerbating the problem by refusing to provide information either to the FDA, which regulates device safety, or even to the hospitals and clinics which use the devices every day.  This attitude is stunningly short-sighted and can only cause harm to both the makers and users of these devices.
• My second area of concern is that the medicare system — which process nearly a billion claims a year and pays health providers nearly a billion dollars a day — won't be ready.  If there are disruptions in the medicare system — and I should also include the state-run medicaid programs in this area — many health care providers, some of whom depend on medicare payments for as much as 40% of their operating budget, will not be able to operate.
• Lastly, I am deeply concerned that rural hospitals, municipal hospitals, or other institutions that are strapped for resources, will not be able to undertake renovations or replacements necessary to fix the year 2000 problem, even if they have the time and funds to make a comprehensive assessment in the first place. -->

  Senator Bennet and I toured a large, well-equipped and well-funded hospital in the DC suburbs on Tuesday morning.   While I was very impressed by the steps the hospital was taking to deal with the year 2000 problem, like replacing or renovating 35% of their medical devices, I couldn't help but wonder how hospitals that are already stretched to the limits are dealing with this problem.

  For example, the hospital that we were touring is planning to replace its kidney-dialysis machines, bought just two years ago at a cost of $14,000 per machine, because those machines are not Y2K compliant.   But can an inner city hospital afford to do that?  Can a hospital serving rural communities in South Dakota afford to do that?  Or will those hospitals be forced to stop providing those services dependent on high-technology machines until their budget allows them to purchase compliant equipment?
   The possible answers to those questions are chilling.
  
  
   These are just a few of the critical areas that I expect to begin addressing here today; and while I don't expect comprehensive answers yet, I hope that will get a blueprint of where the committee needs to go from here on this significant issue.
  
  Again, chairman Bennett, I thank you for devoting the time and resources to bring this hearing about in such an expeditious manner.