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CNN NEWSROOM

Hearing On Obamacare Website Debacle; Nevada Shooter's Parents Could Be Charged; McDonald's Slammed Over Helpline Advice

Aired October 24, 2013 - 10:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


UNIDENTIFIED FEMALE: So then, you know, we heard from Andrew Slavitt who said that, you know, he spoke a little bit about the complexity of the site and about what they called the data hub. So, you know, essentially, when you go in and you're putting your information in there, they ping the IRS and the IRS comes back with your information. That's all the data hub and he says that was working very well. Then he got into what a lot of folks seem to be talking about, that account registration.

Even then, carol, he said there were also many other folks working on this not just that and that's where it seems a lot of the problems were lying. As you said before, he went to say that this was a last minute decision to have them -- you know, have people sign in through this account in order to go in, in order to look at those insurance plans. And then you heard from other folks who were also saying, well, we had nothing to do with this. So it sounds like a giant blame game from what I'm hearing.

CAROL COSTELLO, CNN ANCHOR: Well, it sounds like everybody is throwing everybody under the bus right at the moment. So Laurie, you stick around. I'm going to reset the hour because some viewers are just joining us so I'm going to say good morning to all of you. I'm Carol Costello. Thank you so much for joining me.

Right now, on Capitol Hill lawmakers get their first chance to grill the developers of Obamacare's botched website. Companies are being pressed to explain the crippling problems that plagued the enrollment process and overshadowed the roll out of Obama's signature health reforms. What testimony getting underway just minutes ago, it's no surprise that blame will ricochet in all different directions, in fact, it already has.

Joe Johns is monitoring this hearing from our Washington Bureau. Reset this hearing for us -- Joe.

JOE JOHNS, CRIME AND JUSTICE CORRESPONDENT: Well, Carol, that's Congressman Henry Waxman of California testifying right now, the ranking Democrat on the committee. They've just gotten into it. This testimony has been just about as predictable as it gets especially with a complex I.T. start up like this, and this maybe the mother of all recent government funded I.T. start-ups.

Finger pointing right off the bat, the first witness with the contractor known as CGI -- that's Carol Campbell testifying -- that there was a problem with a function that serves as the entry portal to the website, but that function was the responsibility of another contractor known as Optum/QSSI. The executive from Optum testified that a bottleneck on the site may have been the result of a last- minute change by the government, apparently requiring registration before consumers could browse the site.

The other two witnesses with Equifax and Serco essentially saying they haven't had any problems. So now, they're really getting into the nuts and bolts as the questions are being asked and answered, Carol.

COSTELLO: OK, so you mentioned nuts and bolts. Let's get right to the nuts and bolts right now and listen to testimony. The woman that's talking right now is Sheryl Campbell. She's the senior vice president of CGI Federal, the company mainly responsible for setting up healthcare.gov. She is being questioned by the ranking member of this committee, Henry Waxman. Let's listen.

(BEGIN LIVE FEED)

REPRESENTATIVE HENRY WAXMAN (D), CALIFORNIA: Does CGI have to rewrite 5 million lines of code to fix the problems we've seen thus far?

CHERYL CAMPBELL, SENIOR VICE PRESIDENT, CGI FEDERAL: No, sir. I can tell you that 300 plus employees that I have back in the office would -- I think they would all walk out if I told them they had to rewrite that many lines of code.

WAXMAN: Do you believe it's going to be necessary to scrap the entire healthcare.gov system and start from scratch?

CAMPBELL: I do not, sir.

WAXMAN: So you think the web site will be fixed in time to ensure Americans who want coverage by next year that it will be available to them?

CAMPBELL: I do, sir.

WAXMAN: Why are you so confident? Can you explain that that these problems will be fixed in time?

CAMPBELL: Because as I said, we're seeing improvements day by day. We're continuing to run queries against our database. We're reviewing system logs. We're fine tuning our servers. We are analyzing the code for anomalies. Every day we're seeing where we're finding challenges in the system, in making those corrections, as you would with any system that will go live.

When a system goes into production, these are the things that you would typically find after production. Maybe not to the level of detail that's happened in this experience, but when a system goes live, these are the things that you typically do. You continue to provide system builds and put performance into fine tuning to the application to make sure it continues to improve time over time.

WAXMAN: Mr. Slavitt, your company has been deeply involved in troubling and fixing the problems on healthcare.gov. Do you have any reason to believe problems that are being experienced at this launch will prevent Americans from getting insurance for the coming year?

ANDREW SLAVITT, GROUP EXECUTIVE VICE PRESIDENT, OPTUM/QSSI: Congressman, I'm confident that the data services hub that QSSI developed and the EIDM registration tool are working well today and will continue to work well.

WAXMAN: You had problems with your part early on, but you fixed them, didn't you?

SLAVITT: For the first seven days, correct.

WAXMAN: So problems can be fixed?

SLAVITT: We doubled the capacity of that registration tool within seven days.

WAXMAN: Miss Campbell, did CGI system pass its test before the system went live?

CAMPBELL: Yes, it did.

WAXMAN: And my understanding is that you felt the system was ready to go on October 1. Is that right?

CAMPBELL: That is correct.

WAXMAN: Neither you nor anyone else at the table thought or made a recommendation not to go forward on October 1 because you didn't think the system was ready, is that a correct statement?

CAMPBELL: That's a correct statement.

WAXMAN: Mr. Slavitt?

SLAVITT: I refer back to my earlier answer. We did not make a recommendation. We simply made everyone aware of the risks that we saw.

WAXMAN: Ms. Pellecy (ph)?

UNIDENTIFIED FEMALE: No, we did not make recommendations.

UNIDENTIFIED MALE: We did not either.

WAXMAN: Thank you. Thank you, Mr. Chairman.

UNIDENTIFIED MALE: We recognize the vice chair of whole committee, Ms. Blackburn from Tennessee.

REPRESENTATIVE MARSHA BLACKBURN (R), TENNESSEE: Thank you, Mr. Chairman. Thank you all for your testimony. I would like each of you to submit in writing for me how much you have been paid to date and then how much you're being paid on retainer or either to clear up. So, if you will submit that to us for the record, that would be wonderful. HIPAA compliance, were you all trained in HIPAA compliance prior to beginning your contract? I'll just go right down the line, Ms. Campbell.

CAMPBELL: Yes.

BLACKBURN: Mr. Slavitt?

SLAVITT: Yes, we do extensive HIPAA training.

BLACKBURN: Ms. Pellecy (ph)?

UNIDENTIFIED FEMALE: Yes.

BLACKBURN: Mr. Lau (ph)?

UNIDENTIFIED FEMALE: Yes.

BLACKBURN: Did your companies meet as a group with HHS before you started the process? Anyone, did your companies meet together with HHS to discuss the integration? Mr. Lau (ph), go ahead.

UNIDENTIFIED MALE: Yes. The security people from CMS and Serco and others have coordinated the security.

MARSHA: OK, all right, let me ask each of you a question. How many people in each of your companies have physical access to the database servers storing the enrolling information?

CAMPBELL: Zero from CGI.

BLACKBURN: Pardon me?

CAMPBELL: We have zero access to the database.

BLACKBURN: Zero, OK.

SLAVITT: I believe the answer is also zero for QSSI.

BLACKBURN: Ms. Pellecy (ph)?

UNIDENTIFIED FEMALE: We have no access to the servers.

UNIDENTIFIED MALE: About 2,000 people.

BLACKBURN: Two thousand people have access to the database?

UNIDENTIFIED MALE: Through the key entry of the applications.

BLACKBURN: OK. Under HIPAA regs, no one is expected to have direct access to that database. Under the current technology infrastructure, how many separate servers or virtual servers in the Cloud are being used to host and store data for healthcare.gov? Ms. Campbell, Mr. Slavitt, I think that's primarily to you.

CAMPBELL: I don't have the exact number.

(END LIVE VIDEO FEED) COSTELLO: All right, we're going to jump away and sort of analyze what's been going on in this hearing. Our tech expert, Laurie Segall has been doing a fabulous job with this. Laurie, we heard CGI, the senior vice president say the problems will be fixed and the system will be OK. Do you believe her?

LAURIE SEGALL, CNNMONEY CORRESPONDENT: You know, I will say when I'm -- I'm very excited they asked about that 5 million lines of code needing to be rewritten. They asked about that and said do we need 5 million lines of code to be rewritten in order for this to work? Let me put this in context for you, Carol, it takes about a day to write 100 lines of code for one software engineer.

What Cheryl Campbell said is if I told my 300 employees they had to rewrite that much code, they would walk out. So maybe those estimates, maybe those were inflated estimates. So that could be a good sign, but I think what we can take away here. From looking at everybody kind of deflecting a little bit is the disjointed nature of trying to build something that was such a huge political agenda, such a complicated website.

But the idea that there were so many cooks in the kitchen that in order to build a very good technology site, in order to build something that's going to work, A, you have to test it. B, you have to have a lot of folks in-house, on board communicating. What we're seeing here is that there are simple failures of communication to a point where some of these folks are saying, I don't know if we're really ready to go.

A lot of folks knew that this wasn't really going to work. Yet it was still pushed out. That's why we had so many people saying we get in and what's happening, and that's why this has kind of turned into such a big debacle -- Carol.

COSTELLO: I know I wrote these numbers down somewhere. I was looking for it while you were talking, but you talk about cooks in the kitchen, 55 contractors were involved, five government agencies, 300 different insurers and a dozen states. You're right. Lots of cooks in the kitchen, how could that possibly work?

SEGALL: You know, at this point, we're seeing that it hasn't worked. It's safe to say, as we see folks kind of deflecting a little that it really didn't work. That one person was working on one technology, but they weren't communicating with another contractor working on another technology and some people realized that the coding was off. So they told another contractor who was in charge of telling someone else.

This is why you -- I mean, from a Silicon Valley perspective, successful web site happens in a successful company -- even Google in those beginning phases, when you're in this lean phase, identify it, take it to the top and get it fixed. Here it sounds as if that simply didn't happen and now we're seeing the outcome.

COSTELLO: Laurie Segall, stick around. I have to take another break. We'll be back with much more in the NEWSROOM. (COMMERCIAL BREAK)

COSTELLO: All right, welcome back. It's 14 minutes the past the hour, still continuing to monitor this hearing going on Capitol Hill. Lawmakers are trying to figure out what went so wrong with healthcare.gov. We'll dip in, in a moment. But we want to check some other top stories first. It's now 15 minutes past.

President Obama tells German Chancellor Angel Merkel the United States does not monitor her phone calls. Merkel had called the president after the German government said her calls might have been monitored. Germany and other nations had already express concerns about possible U.S. spying based on classified information leaked by former NSA contractor, Edward Snowden.

The Red Sox honored a teacher killed outside a Boston area high school before game one of the World Series, Fenway Park held a moment of silence for Colleen Ritzer. People in the Boston area and across the nation are heartbreaking and trying to make sense of this brutal killing.

The cousin of Robert Kennedy Jr. in prison for more than a decade for 1975 killing is getting a new trial and could be released on bond. Michael Skakel was convicted of killing his neighbor, Martha Moxley. A judge ruled Skakel's defense was inadequate. State prosecutors plan to appeal the ruling.

The parents of a seventh grade student in Nevada could face charges after their son shot and killed his math teacher and wounded two classmates. Police say the killer's semi-automatic handgun could have come from his parents' house. It's actually more common and widespread than you might think. This past May in Florida, a fifth grader brought a gun to a special needs class. Back in August, a preschooler near Atlanta brought a loaded gun. That gun was in his backpack.

Also last August a handgun went off accidentally in a 5-year-old's backpack in an elementary school cafeteria in Memphis. News reports often don't follow up on how these kids don't get a hold of a gun although many of those guns do come from the child's home.

Let's talk about that and what should be done. CNN legal analyst Paul Callan is here and also CNN digital correspondent, Kelly Wallace. Welcome to both of you. Kelly, I was shocked that so many 4 and 5- year-olds were found with guns in their backpacks, 4 and 5-year-olds getting a hold of guns?

KELLY WALLACE, CNN DIGITAL CORRESPONDENT: I mean, it's impossible, right, to comprehend? Any gun owner, anyone who has guns in their home needs to take responsibility and needs to do everything possible to make sure those guns are not getting in the hands of children. We obviously have, in some states, laws on the books that if the parents knowingly allowed a child to get access to a firearm, they could be criminally charged. But there's a lot more that some gun-control advocates say needs to be done to prevent this from happening, 4-year- old, 5-year-old from taking a gun in a backpack. COSTELLO: Kelly said that magic word, knowingly. Knowingly is the word, knowingly allow, should the law be changed? You don't want your 5-year-old ever to get a hold of a gun. So the parent is going to come out and say, yes, I let him have access to the gun.

PAUL CALLAN, CNN LEGAL ANALYST: No, but there is something called circumstantial evidence could prove that ready access was available. If a child can get his hands on a loaded weapon automatically there's an indication it wasn't be stored in a proper manner, in my view.

Now 27 states have adopted laws in the aftermath of Sandy Hook tragedy, child act protection laws, which specifically require parents to lock down their weapons if children are present in the house. Now some of them have pretty mild penalty provisions, but there seems to be a movement across the United States now to enact more laws in this area.

COSTELLO: And, Kelly, I wanted to ask you specifically about this Nevada case. The kid was 12, right?

WALLACE: Yes.

COSTELLO: He committed suicide after killing his math teacher and shooting two other students. His parents are said to be devastated. They had no idea something like this could happen. Then you have to ask the question, maybe let's just assume they were irresponsible and the kid got a hold of the gun when he shouldn't have. But you don't know that you're -- often, you don't know your kid could kill.

WALLACE: Exactly, Carol. I think that this push, right, to blame the parents, in some ways it makes us feel better, right? OK. It must have been the parents' fault. They didn't do enough. It certainly couldn't happen in our household. Lisa Belkin of Huffington Post wrote a powerful column talking about research she did years ago, reading depositions from parents whose children were involved in previous school shootings and she said the parents did everything right.

They kept computer in the open, kept the gun secured, looked in the kid's backpack to look at papers so they knew what was going on and they didn't know what was going on. This push to blame the parents, is it really going to stop future school shootings or is it just going to make us feel better? That's the big question.

COSTELLO: Paul, I'll pose that question to you in a different way. There are so many guns in this country, so many guns. A third of the country have guns, own guns so sometimes kids are going to get a hold of those guns because accidents do happen. So how culpable should parents really be?

CALLAN: We have these laws which are being passed. Even before that happened virtually every state has laws relating to, we call it reckless endangerment in some states. If you allow a child to have access to something that the child can hurt him or herself with or somebody else with, that already can be criminal conduct. But you have to look at what precisely the storage practices are with the parent. There's lots of laws on the books that can be enforced if the parents are storing guns in an open, unsafe way. A lot of those laws have not been enforced in the past. With all the killing we are seeing of children in schools it's time to crack down and enforce those laws that are already on the book.

COSTELLO: Paul Callan, Kelly Wallace, thank you. Appreciate it. We'll be back with me.

(COMMERCIAL BREAK)

COSTELLO: As you might expect, there's a lot of political posturing going on in this congressional hearing, supposed to look into the problems of the Obamacare healthcare exchanges. This is Congressman Pallone. He is Democrat from New Jersey. He just accused this hearing, which basically run by Republicans because Republicans control this committee and the House. He just accused the entire committee of holding a monkey court because Republicans intimated that health care information would be shared with others when people enter these health care exchanges. I would like you to listen to that exchange.

(BEGIN VIDEOTAPE)

REPRESENTATIVE FRANK PALLONE (D), NEW JERSEY: Yielding. I am trying to tell you that the problem here -- protecting American citizens. HIPAA doesn't apply. You're asked about your address, your date of birth. You're not asked health information. Why are we going down this path? Because you are trying to scare people so they don't apply and so, therefore, the legislation gets delayed or the affordable care act gets defunded or it's repealed.

That's all it is, hoping people won't apply. There are millions of people out there, over 20 million that are going on this site. They are going to apply and they are ultimately going to be able to enroll. In fact, many of them already have enrolled. I think my Republican colleagues forget that a lot of people are enrolling through state exchanges rather than the federal exchange.

And if it wasn't for the fact that many Republican governors, including my own from new jersey, had agreed to set up state exchanges, then we wouldn't be putting so much burden on the federal system. But I just want to give you some examples. In New York and Washington, 30,000 people have been enrolled in coverage. In Oregon over 50,000 people have enrolled. In California, over 100,000 have started --

COSTELLO: All right, we're going to jump out of this. You can see it's getting a little heated. This hearing will go on for quite some time. We'll continue to monitor this hearing for you. Stay with CNN throughout the day.

Just to remind you, the president is expected to make some sort of statement at 10:35 Eastern time. He will talk about immigration. He certainly will not be talking about Obamacare and the problems associated with healthcare.gov. The presidential podium is set up and the president will make a statement about immigration reform. Our Jake Tapper will be covering that part of the political story today.

Other stories this morning for you, critics are blasting fast food giant McDonald's, accusing the company of directing some of its lowest paid employees to agencies like food stamps and Medicaid. They go to McResources. One employee called McDonald's help line and recorded what happened.

(BEGIN VIDEOTAPE)

UNIDENTIFIED OPERATOR: McResource line. How can I help you?

UNIDENTIFIED FEMALE: Hi. I'm Nancy. I wanted more information about the help that I need.

UNIDENTIFIED OPERATOR: I can give you a number that will be helpful. You can ask about things like food pantries. Are you on SNAP, Supplemental Nutritional Assistance, food stamps? Do you have kids? Are you single?

UNIDENTIFIED FEMALE: Yes, yes.

UNIDENTIFIED OPERATOR: Yes. You would most likely be eligible for S.N.A.P. benefits. You know, it's a federal program. Federal money comes down to the states and the states administer it.

UNIDENTIFIED FEMALE: What about like the doctor and --

UNIDENTIFIED OPERATOR: Did you try to get on Medicaid? Medicaid is a federal program. It's health program for adults and children. Let me find the number that you can call in Chicago to like find help with all of your questions.

(END VIDEOTAPE)

COSTELLO: So I want to bring in that employee who made the phone call. Her name is Nancy Salgado. She works at McDonald's in Chicago. Good morning, Nancy.

NANCY SALGADO, MCDONALD'S EMPLOYEE: Good morning.

COSTELLO: When you called that hotline, what were you expecting?

SALGADO: I was expecting to get some of the help I need, you know, with my bills and day-to-day needs, you know.

COSTELLO: In what way? Why would McDonald's be responsible for that?

SALGADO: It was a hotline that said they could help us. So I was expecting to see what help they provided. I never expected them to redirect me to government assistance.

COSTELLO: What did you expect?

SALGADO: I expected, you know, a way for them to say, you know, we can provide with this and help you with your needs, you know. But honestly, I wasn't expecting to get directed to any government assistance.

COSTELLO: I know you have worked for McDonald's over ten years and you haven't had a raise in all that time and you have, what, three children?

SALGADO: I have two kids.

COSTELLO: Two kids. And how much do you get paid?

SALGADO: I get paid $8.25.

COSTELLO: So you make below the poverty level.

SALGADO: Correct.

COSTELLO: Right. And are you fighting for McDonald's to raise wages for fast food workers across the country?

SALGADO: Yes, I am.

COSTELLO: OK, I just wanted to be transparent so that everybody knows that. And the first question people always ask, when they find out about your endeavor, is why not just get another job?

SALGADO: I believe that we deserve better paid because we work hard and we multitask and our jobs now are like $8.25 everywhere you go. And I enjoy my job but I think I should get paid better.

COSTELLO: McDonald's has responded to this recording and I want to read to you what the company says. This is a quote from the company. Quote, "The McResource line is intended to be a free confidential service to help employees and their families to get answers to a variety of questions or provide resources on a variety --