[Congressional Record Volume 142, Number 134 (Wednesday, September 25, 1996)]
[Senate]
[Pages S11299-S11302]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. GRAHAM (for himself, Mr. Grassley, Ms. Moseley-Braun, Mr. 
        Chafee, Mr. Jeffords, Mr. Baucus, Mr. Simon, Mr. Hollings, and 
        Mr. Wellstone):
  S. 2121. A bill to ensure medicare beneficiaries participating in 
managed care have access to emergency and urgent care; to the Committee 
on Finance.


           THE MEDICARE ACCESS TO EMERGENCY MEDICAL CARE ACT

  Mr. GRAHAM. Mr. President, today I will introduce legislation 
entitled Medicare Access to Emergency Medical Care Act, joined by 
Senators Grassley, Moseley-Braun, Chafee, Baucus, Jeffords, Simon, 
Hollings, and Wellstone.
  This legislation would require Medicare health maintenance 
organizations to pay for emergency care services provided to prudent 
beneficiaries seeking emergency care and would preclude health 
maintenance organizations from requiring prior authorizations in such 
situations. This language, Mr. President, was previously approved by 
unanimous consent in the Senate during consideration of the Balanced 
Budget Act of 1995.
  Why is this bill necessary? Mr. President, lack of a ``prudent lay 
person'' definition places Medicare beneficiaries in the unreasonable 
position of having emergency room visits for experiences, such as chest 
pain, denied for reimbursement by managed care organizations, in some 
cases significantly subsequent to the visit to the emergency room. Why 
denied? Denied because the beneficiary did not seek prior 
authorization, or denied because the beneficiary was diagnosed not to 
have an emergency condition, even if a reasonable person believed that 
they had an emergency condition.
  According to the congressionally established Physician Payment Review 
Commission's 1996 annual report to Congress:

       Medicare requires health plans to provide or pay for care 
     needed in an emergency, but what constitutes an emergency may 
     be misunderstood or disputed by plans and beneficiaries. The 
     definition of ``emergency'' is central to resolve such 
     disputes and guide beneficiaries before they seek emergency 
     care.

  Mr. President, currently, 60 percent of the claims that are disputed 
between Medicare beneficiaries and managed care plans involve emergency 
room services. Let me repeat that. Sixty percent of the claims that are 
disputed between Medicare beneficiaries and managed care plans involve 
emergency room services. As a result, the Physician's Payment Review 
Commission recommends, ``A prudent lay person's perspective should be 
considered as one of the factors in determining when a health plan that 
participates in Medicare should pay for initial screening and 
stabilization, if necessary, in an emergency.

  That is the standard which this legislation adopts. This legislation 
would protect Medicare beneficiaries who appear to act prudently from 
the perspective of a lay person--such as thinking that chest pain may 
be an indication of a heart attack and seeking emergency care. It would 
protect those Medicare beneficiaries from facing substantial,

[[Page S11300]]

or in some cases even catastrophic, financial liabilities. The irony of 
this situation is that the Federal Emergency Medical Treatment and 
Labor Act requires that all persons who come to a Medicare-
participating hospital for emergency care be given a screening 
examination to determine if they are experiencing a medical emergency 
and, if so, that they receive stabilizing treatment before being 
discharged or moved to another facility. And that facility, that 
Medicare-participating hospital emergency room is required to provide 
those services without regard to the financial ability of the 
individual to pay.
  As a result, emergency room doctors and hospitals face a Catch-22. 
They are required by Medicare law and their own professional ethics to 
perform diagnostic tests and examinations to rule out emergency 
conditions. But those same health care providers may be denied 
reimbursement due to prior authorization requirements or a finding that 
the condition was not of an emergent nature, even though symptoms, such 
as extreme pain, shortness of breath, chest pains, loss of blood, or 
others, would prompt most lay persons to conclude that they need to 
seek medical care immediately.

  Dr. Paul Lindeman wrote in an article in the Miami Herald on July 30, 
1995, about an 85-year-old woman with a hip fracture who was denied 
admission to his hospital's emergency department by her health 
maintenance organization so that she could be transferred to an 
emergency department across town. The patient had to wait 3 hours for 
the HMO ambulance service. According to Dr. Lindeman, ``No matter how 
well-trained or talented the emergency physician, there are also times 
when he or she requires the urgent services of a consultant to provide 
definitive care for a patient (for instance, vascular and orthopedic 
surgeons to repair a severely traumatized limb). In these cases, delays 
in care due to managed care bureaucracy can become a legitimate hazard 
to the patient.''
  Now, Mr. President, some might be concerned that this legislation 
would preclude health maintenance organizations from limiting 
reimbursement for frivolous emergency room use and abuse by some 
beneficiaries. Such concern is unwarranted because this legislation 
does not prevent managed care plans from retrospectively reviewing 
services delivered in the hospital emergency department to Medicare 
beneficiaries. All it does is require the plans to base their review on 
whether the patient acted prudently given the patient's symptoms. 
Frivolous or abusive emergency room use by a patient would not be 
prudent and, therefore, could still be denied by the HMO.
  Mr. President, in 1993, the Network Design Group, a group which is 
best known for their work as a national mediator and arbiter of 
disputes between Medicare beneficiaries and their health maintenance 
organizations, wrote a report for the Federal Government. In that it 
stated, ``Definitions of `emergency' in regulation should be modified 
so that a reasonable and prudent lay person can anticipate claims that 
would be covered versus denied.''
  Michael Stocker, the president and chief executive officer of Empire 
Blue Cross/Blue Shield in New York, argued a similar point in an 
editorial entitled ``The Ticket To Better Managed Care,'' which was 
published in the New York Times on October 28, 1995. Mr. Stocker wrote, 
``At times, managed care is a euphemism for cost-cutting that puts the 
patient second. Because of the industry's financial success, too few 
organizations are paying attention to people's rising worries about how 
they will fare in HMO's that restrict access to specific doctors and 
hospitals.''
  Mr. Stocker further argues that plans must ``provide high-quality 
service in ways that can be proved and readily understood.''
  As part of providing quality of care to patients that is readily 
understood, Mr. Stocker concludes that, ``Health plans should pay for 
emergency room coverage for consumers who believe they have a 
legitimate emergency, even if it turns out that they do not.'' That is 
a perfect description of this bill's ``prudent lay person'' standard.
  Finally, since the Federal Government and beneficiaries are paying 
through Medicare for emergency room services--that is, emergency room 
services are on the list of medical services that a Medicare 
beneficiary contracts to receive when they join a health maintenance 
organization--it makes sense to require that those services be provided 
and paid for on a reasonable basis.
  Without it, Medicare becomes like a horribly ineffective Government 
program where money goes in but results and the delivery of services 
are lacking to the beneficiary. We in this Congress have a financial 
responsibility to demand that the services which we pay for are being 
delivered.
  Mr. President, as we know managed care is becoming an increasing part 
of our health care system as it relates to Medicare beneficiaries. In 
1990, there were only 3.5 percent of all Medicare beneficiaries 
enrolled in a managed care plan. Today that number exceeds 9 percent. 
The importance and need for this legislation will only increase as more 
and more Medicare beneficiaries are encouraged to elect managed care 
over fee-for-service as the form of receiving their Medicare services.
  As a result, with the cosponsors, a broad bipartisan group of my 
colleagues, I am introducing this important legislation today. And I 
urge its adoption in the remaining days of this session, or in the next 
Congress.
  Mr. President, I ask unanimous consent that copies of newspaper 
articles which I have cited from the Miami Herald and the New York 
Times regarding this issue be printed in the Record.
  Mr. GRAHAM. Mr. President, I send to the desk this legislation, and 
request its immediate referral.
  The PRESIDING OFFICER. The bill will be referred to the appropriate 
committee.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                 [From the Miami Herald, July 30, 1995]

               HMO's in the ER: A View From the Trenches

                         (By Paul R. Lindeman)

       I arrived for my 12-hour shift in the Emergency Department 
     at 7 p.m. As the departing physician and I went over the 
     cases of the current patients, I was told the woman in Room 2 
     was being transferred to a psychiatric facility. The patient 
     was pregnant, addicted to crack cocaine and had been assessed 
     as suicidal by a psychiatrist.
       An obstetrician was required to care for the patient during 
     her stay at the mental health facility. The only two groups 
     of practicing obstetricians who were on this woman's HMO 
     ``panel'' and on staff at this facility both refused to 
     accept this high-risk case. That left this unfortunate woman, 
     and our staff, caught in the ``never-never land'' of managed 
     care.
       When I left the Emergency Department at 7:30 the following 
     morning, she was still in Room 2. It took hospital 
     administrators and attorneys all day to arrange disposition, 
     and the patient was eventually transferred--at 6:30 that 
     evening.
       Managed-care health plans typically limit choice of doctors 
     and hospitals and attempt to closely monitor services 
     provided. Their goal is to curb unnecessary tests and 
     hospitalizations to keep costs down. In the case of for-
     profit managed-care companies, the additional purpose is 
     obvious. But what happens when managed care meets the 
     emergency room?
       Federal law requires a screening exam at emergency 
     facilities, but HMOs are not required to pay. By exploiting 
     this fact, managed care is able to shift costs onto 
     hospitals, doctors and policyholders, thereby ``saving'' 
     money.
       Consider the case of a 50-year-old male who awakes at 4 
     a.m. with chest pain and goes to the hospital 10 blocks 
     away--instead of his HMO hospital an extra 30 minutes away. 
     After examination and testing, it's determined that the 
     patient is not having a heart attack and that it's safe for 
     him to go home.
       His diagnosis is submitted on a claim form with a code for 
     ``gastritis.''
       His insurance company denies payment, stating that 
     ``gastritis'' is not an emergency. As a result, the hospital 
     and the company who employs the emergency department 
     physician both bill the patient.
       While this ``retrospectoscope'' is widely employed and 
     industry standard for denying payment, there are many other 
     ``savings'' techniques. For instance, many HMOs require 
     ``pre-authorization'' to treat a patient in the ER.
       Consider now a 60-year-old female who arrives at the 
     emergency room complaining also of chest pain. The triage 
     nurse examines the patient, obtaining a brief history and 
     vital signs. A call is placed to the insurance company and a 
     recorded message is obtained without specific instruction 
     regarding emergencies. The patient is treated but the 
     payment is denied. Reason: Authorization was never 
     obtained.
       Here's an alternate scenario, same patient, again waiting 
     for pre-authorization. (Noncritical patients often wait for 
     more than an hour.) This time ``the insurance company'' 
     answers the phone. Reading from a list, a series of questions 
     is asked, limited almost exclusively to obtaining recorded 
     numbers.

[[Page S11301]]

     Based on these numbers, the individual speaking for the 
     company determines that it is safe for the patient to be 
     transferred to its hospital. The emergency physician 
     disagrees. The patient stays and is admitted to the hospital.
       The HMO denies payment for the ER visit and the 24-hour 
     hospitalization, stating that the patient should have been 
     transferred. Again, the patient/policyholder, who pays a 
     monthly premium for his or her insurance, is billed for all 
     hospital and physician services.
       The representative for the insurance company who decides on 
     preauthorization can range from someone with no medical 
     background at all to another physician (albeit with a vested 
     economic incentive). Generally the level of expertise is 
     somewhere between this. Thus, the near-Orwellian scenario 
     frequently plays out whereby a doctor who has seen and 
     examined a patient is trying to convince a nurse, over the 
     telephone, that a patient is sick.
       Rudy Braccili Jr., business operations director for the 
     North Broward Hospital District, was quoted in The Herald as 
     saying. ``It's just a game they play to avoid paying, and 
     it's one of the ways they save money. They do not see the 
     realities of people who in the middle of the night come into 
     emergency rooms.'' He estimates that North District hospitals 
     have lost millions of dollars a year because of HMOs' 
     reluctance to pay bills.
       Part of the problem is that what managed-care organizations 
     are trying to do is often quite difficult: determine 
     prospectively which patients are truly deserving of 
     emergency-room care. Indeed, this may in fact be a Catch-22. 
     I know of no way to accurately discern acute appendicitis 
     from a ``tummy ache'' without a history and physical 
     examination. Furthermore, medicine does not always lend 
     itself to black and white. For instance, is a woman who 
     screams and gyrates hysterically as a result of a squirming 
     cockroach in her ear an emergency?
       Unfortunately, problems with HMOs in the ER go beyond cost 
     shifting and denial of payment. They often turn an otherwise 
     brief encounter into a harrowing ordeal. Another example from 
     ``the trenches'' is illustrative.
       Our patient this time is an 85-year-old woman with a hip 
     fracture. But instead of being admitted, her HMO mandates 
     that she be transferred across town to the emergency 
     department at another facility where they contract their 
     surgical hip repairs. The patient waits three hours for the 
     HMO ambulance service, which is ``backed up.''
       Consumers note: Had the patient not sold her Medicare 
     privileges to this HMO, she would have been admitted to our 
     hospital uneventually in a fraction of the time required to 
     complete her managed-care sojourn.
       No matter how well trained or talented the emergency 
     physician, there are also times when she or he requires the 
     urgent services of a consultant to provide definitive care 
     for a patient (for instance, vascular and orthopedic surgeons 
     to repair a severely traumatized limb). In these cases, 
     delays in care due to managed-care bureaucracy can become a 
     legitimate hazard to the patient.
       Dr. Charlotte S. Yeh, chief of emergency medicine at the 
     New England Medical Center, has said, ``In some ways, it's 
     less frustrating for us to take care of homeless people than 
     HMO members. At least we can do what we think is right for 
     them, as opposed to trying to convince an HMO over the phone 
     of what's the right thing to do.''
       In my experience that is not an exaggeration. In the 
     emergency department, the homeless--while certainly deserving 
     of medical care--often receive better and more prompt care 
     than the HMO policyholder.
       Conventional political wisdom holds that health-care reform 
     is dead, in fact, nothing could be further from the truth. 
     Reform has been taking place at breakneck speed entirely 
     independent of Washington. In the last five to 10 years, 
     managed-care companies and the private sector have changed 
     profoundly the manner in which many Americans now receive 
     their health care.
       As for-profit managed care has usurped decision-making 
     authority from physicians, so have they also diverted funds 
     from hospitals, physicians and policyholders to their own 
     CEOs and stockholders. Last year, HMO profits grew by more 
     than 15 percent, with the four largest HMOs each reporting 
     more than $1 billion in profits. What Democrats and 
     Republicans alike fail to appreciate is that the allegiance 
     of managed care is to neither the patient nor the reduction 
     of the federal deficit, but to its CEOs and stockholders.
       So next time you see one of those warm and fuzzy television 
     commercials for an HMO that promises the world, remember 
     this: ``choose your own doctor'' really means choose your own 
     doctor from our list. And as for the claim ``no premiums, no 
     deductibles, no copayment'' (health insurance for free?), you 
     may as well pencil in: ``no doctor.'' At least, not one 
     likely to get up in the middle of the night.
                                                                    ____


                [From the New York Times, Oct. 28, 1995]

                   The Ticket to Better Managed Care

                        (By Michael A. Stocker)

       The central question about the future of health care goes 
     beyond the outcome of the debate over Medicare and Medicaid: 
     Can health maintenance organizations and other managed care 
     plans truly provide low-cost and high-quality health care?
       Like many people, I am dismayed at the way some managed 
     care organization work. At times, managed care is a euphemism 
     for cost-cutting that puts the patient second. Because of the 
     industry's financial success, too few organizations are 
     paying attention to people's rising worries about how they 
     will fare in H.M.O.'s that restrict access to specific 
     doctors and hospitals.
       H.M.O.'s can no longer expect to prosper simply because 
     they are less expensive than traditional fee-for-service 
     medical care. They must keep proving that their goal, first 
     and foremost, is to provide high-quality service in ways that 
     can be proved and readily understood. Not every health plan 
     will succeed, but there are some avenues that every health 
     plan executive should follow.
       Learning about a good health plan by word of mouth is 
     insufficient. The industry needs to provide information that 
     enables people to compare plans and chose intelligently among 
     them when they are not sick.
       In my view, in New York State that means establishing a 
     public-private system that compares the performances of 
     competing plans and requires all plans to participate. The 
     criteria might include the time it takes to get problems 
     solved properly and to see an appropriate doctor when one 
     needs to do so.
       Like the rest of the medical profession, H.M.O.'s need to 
     improve the way they measure the outcome of their treatments. 
     While the art of diagnosis is well-developed, often treatment 
     involves more uncertainty. In New York, the Department of 
     Health has been releasing risk-adjusted mortality data about 
     common types of heart surgery. However uneasy doctors are 
     about such findings, the data have pointed out real 
     differences in the quality of care among doctors and 
     hospitals. We need more information like this. Most 
     companies are not investing enough money in developing and 
     operating patient-information banks. Keeping inferior 
     records is self-defeating.
       Most people thing a high-quality health plan is one that 
     lets them choose their doctors. While such a choice is 
     important, it is not the whole story. Some plans that limit 
     access to physicians and hospitals can be very high in 
     quality. But they really have to prove it.
       H.M.O's must go out of their way to involve patients in 
     their own care. Studies show that when patients know more 
     about their alternatives, and participate with their doctors 
     in decision-making, the result is not only happier but also 
     healthier patients, and even cost savings.
       Legislation should be introduced in Albany that lays down a 
     number of requirements: First, intelligible full-disclosure 
     literature is imperative. Health plans must make clear the 
     guidelines they want their doctors to follow when treating 
     patients. The plans should disclose the treatments not 
     covered. Second, the plans should full disclose their payment 
     to physicians, including bonuses related to cost containment 
     and quality of care.
       Third, health plans should pay for emergency room coverage 
     for consumers who believe they have a legitimate emergency, 
     even if it turns out they do not. Fourth, patients should be 
     aware of the drugs that managed care plans allow doctors to 
     prescribe. They should also know how to appeal decisions 
     about drugs.
       In short, health plans have to stop ignoring the public's 
     fears and acting so much like cold insurance companies. They 
     have to start listening more like doctors.
                                                                    ____


                [From the New York Times, July 9, 1995]

          H.M.O.'s Refusing Emergency Claims, Hospitals Assert


                        two missions in conflict

   ``Managed Care'' Groups Insist They Must Limit Costs--Doctors Are 
                               Frustrated

                            (By Robert Pear)

       Washington, July 8.--As enrollment in health maintenance 
     organizations soars, hospitals across the country report that 
     H.M.O.'s are increasingly denying claims for care provided in 
     hospital emergency rooms.
       Such denials create obstacles to emergency care for H.M.O. 
     patients and can leave them responsible for thousands of 
     dollars in medical bills. The denials also frustrate 
     emergency room doctors, who say the H.M.O. practices 
     discourage patients from seeking urgently needed care. But 
     for their part, H.M.O.'s say their costs would run out of 
     control if they allowed patients unlimited access to hospital 
     emergency rooms.
       How H.M.O.'s handle medical emergencies is an issue of 
     immense importance, given recent trends. Enrollment in 
     H.M.O.'s doubled in the last eight years, to 41 million in 
     1994, partly because employers encouraged their use as a way 
     to help control costs.
       In addition, Republicans and many Democrats in Congress say 
     they want to increase the use of H.M.O.'s because they 
     believe that such prepaid health plans will slow the growth 
     of Medicare and Medicaid, the programs for the elderly and 
     the poor, which serve 73 million people at a Federal cost of 
     $267 billion this year.
       Under Federal law, a hospital must provide ``an appropriate 
     medical screening examination'' to any patient who requests 
     care in its emergency room. The hospital must also provide 
     any treatment needed to stabilize the patient's condition.
       Dr. Toni A. Mitchell, director of emergency care at Tampa 
     General Hospital in Florida, said: ``I am obligated to 
     provide the care, but the H.M.O. is not obligated to pay for 
     it. This is a new type of cost-shifting, a way for H.M.O.'s 
     to shift costs to patients, physicians and hospitals.''
       Most H.M.O.'s promise to cover emergency medical services, 
     but there is no standard

[[Page S11302]]

     definition of the term. H.M.O.'s can define it narrowly and 
     typically reserve the right to deny payment if they conclude, 
     in retrospect, that the conditions treated were not 
     emergencies. Hospitals say H.M.O.'s often refuse to pay for 
     their members in such cases, even if H.M.O. doctors sent the 
     patients to the hospital emergency rooms. Hospitals then 
     often seek payment from the patient.
       Dr. Stephan G. Lynn, director of emergency medicine at St. 
     Luke's-Roosevelt Hospital Center in Manhattan, said: ``We are 
     getting more and more refusals by H.M.O.'s to pay for care in 
     the emergency room. The problem is increasing as managed care 
     becomes a more important source of reimbursement. Managed 
     care is relatively new in New York City, but it's growing 
     rapidly.''
       H.M.O.'s emphasize regular preventive care, supervised by a 
     doctor who coordinates all the medical services that a 
     patient may need. The organizations try to reduce costs by 
     redirecting patients from hospitals to less expensive sites 
     like clinics and doctors' offices.
       The disputes over specific cases reflect a larger clash of 
     missions and cultures. An H.M.O. is the ultimate form of 
     ``managed care,'' but emergencies are, by their very nature, 
     unexpected and therefore difficult to manage. Doctors in 
     H.M.O.'s carefully weigh the need for expensive tests or 
     treatments, but in an emergency room, doctors tend to do 
     whatever they can to meet the patient's immediate needs.
       Each H.M.O. seems to have its own way of handling 
     emergencies. Large plans like Kaiser Permanente provide a 
     full range of emergency services around the clock at their 
     own clinics and hospitals. Some H.M.O.'s have nurses to 
     advise patients over the telephone. Some H.M.O. doctors take 
     phone calls from patients at night. Some leave messages on 
     phone answering machines, telling patients to go to hospital 
     emergency rooms if they cannot wait for the doctors' office 
     to reopen.
       At the United Healthcare Corporation, which runs 21 
     H.M.O.'s serving 3.9 million people, ``It's up to the 
     physician to decide how to provide 24-hour coverage,'' says 
     Dr. Lee N. Newcomer, chief medical officer of the 
     Minneapolis-based company.
       George C. Halvorson, chairman of the Group Health 
     Association of America, a trade group for H.M.O.'s, said he 
     was not aware of any problems with emergency care. ``This is 
     totally alien to me,'' said Mr. Halvorson, who is also 
     president of Health-Partners, an H.M.O. in Minneapolis. 
     Donald B. White, a spokesman for the association said, ``We 
     just don't have data on emergency services and how they're 
     handled by different H.M.O.'s.''
       About 3.4 million of the nation's 37 million Medicare 
     beneficiaries are in H.M.O.'s. Dr. Rodney C. Armstead, 
     director of managed care at the Department of Health and 
     Human Services, said the Government had received many 
     complaints about access to emergency services in such plans. 
     He recently sent letters to the 164 H.M.O.'s with Medicare 
     contracts, reminding them of their obligations to provide 
     emergency care.
       Alan G. Raymond, vice president of the Harvard Community 
     Health Plan, based in Brookline, Mass., said, ``Employers are 
     putting pressure on H.M.O.'s to reduce inappropriate use of 
     emergency services because such care is costly and episodic 
     and does not fit well with the coordinated care that H.M.O.'s 
     try to provide.''
       Dr. Charlotte S. Yeh, chief of emergency medicine at the 
     New England Medical Center, a teaching hospital in Boston, 
     said: ``H.M.O.'s are excellent at preventive care, regular 
     routine care. But they have not been able to cope with the 
     very unpredictable, unscheduled nature of emergency care. 
     They often insist that their members get approval before 
     going to a hospital emergency department. Getting prior 
     authorization may delay care.
       ``In some ways, it's less frustrating for us to take care 
     of homeless people than H.M.O. members. At least, we can do 
     what we think is right for them, as opposed to trying to 
     convince an H.M.O. over the phone of what's the right thing 
     to do.''
       Dr. Gary P. Young, chairman of the emergency department of 
     Highland Hospital in Oakland, Calif., said H.M.O.'s often 
     directed emergency room doctors to release patients or 
     transfer them to other hospitals before it was safe to do so. 
     ``This is happening every day,'' he said.
       The PruCare H.M.O. in the Dallas-Forth area, run by the 
     Prudential Insurance Company of America, promises ``rock 
     solid health overage,'' but the fine print of its members' 
     handbook says, ``Failure to contact the primary care 
     physician prior to emergency treatment may result in denial 
     of payment.''
       Typically, in an H.M.O., a family doctor or an internist 
     managing a patient's care serves as ``gatekeeper,'' 
     authorizing the use of specialists like cardiologists and 
     orthopedic surgeons. The H.M.O.'s send large numbers of 
     patients to selected doctors and hospitals; in return, they 
     receive discounts on fees. But emergencies are not limited to 
     times and places convenient to an H.M.O.'s list of doctors 
     and hospitals.
       H.M.O.'s say they charge lower premiums than traditional 
     insurance companies because they are more efficient. But 
     emergency room doctors say that many H.M.O.'s skimp on 
     specialty care and rely on hospital emergency rooms to 
     provide such services, especially at night and on weekends.
       Dr. David S. Davis, who works in the emergency department 
     at North Arundel Hospital in Glen Burnie, Md., said: 
     ``H.M.O.'s don't have to sign up enough doctors as long as 
     they have the emergency room as a safety net. The emergency 
     room is a backup for the H.M.O. in all its operations.'' 
     Under Maryland law, he noted, an H.M.O. must have a system to 
     provide members with access to doctors at all hours, but 
     it can meet this obligation by sending patients to 
     hospital emergency rooms.
       To illustrate the problem, doctors offer this example: A 
     57-year-old man wakes up in the middle of the night with 
     chest pains. A hospital affiliated with his H.M.O. is 50 
     minutes away, so he goes instead to a hospital just 10 blocks 
     from his home. An emergency room doctor orders several common 
     but expensive tests to determine if a heart attack has 
     occurred.
       The essence of the emergency physician's art is the ability 
     to identify the cause of such symptoms in a patient whom the 
     doctor has never seen. The cause could be a heart attack. But 
     it could also be indigestion, heartburn, stomach ulcers, 
     anxiety, a panic attack, a pulled muscle or any of a number 
     of other conditions.
       If the diagnostic examination and tests had not been 
     performed, the hospital and the emergency room doctors could 
     have been cited for violating Federal law.
       But in such situations, H.M.O.'s often refuse to pay the 
     hospital, on the ground that the hospital had no contract 
     with the H.M.O., the chest pain did not threaten the 
     patient's life or the patient did not get authorization to 
     use a hospital outside the H.M.O. network.
       Representative Benjamin L. Cardin, Democrat of Maryland, 
     said he would soon introduce a bill to help solve these 
     problems. The bill would require H.M.O.'s to pay for 
     emergency medical services and would establish a uniform 
     definition of emergency based on the judgment of ``a prudent 
     lay person.'' The bill would prohibit H.M.O.'s from requiring 
     prior authorization for emergency services. A health plan 
     could be fined $10,000 for each violation and $1 million for 
     a pattern of repeated violations.
       The American College of Emergency Physicians, which 
     represents more than 15,000 doctors, has been urging Congress 
     to adopt such changes and supports the legislation.
       When H.M.O.'s deny claims filed on behalf of Medicare 
     beneficiaries, the patients have a right to appeal. The 
     appeals are heard by a private consulting concern, the 
     Network Design Group of Pittsford, N.Y., which acts as agent 
     for the Government. The appeals total 300 to 400 a month, and 
     David A. Richardson, president of the company, said that a 
     surprisingly large proportion--about half of all Medicare 
     appeals--involved disagreements over emergencies or other 
     urgent medical problems.
                                 ______