[Congressional Record Volume 144, Number 107 (Monday, August 3, 1998)]
[House]
[Pages H6983-H6988]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
THE DIFFERENCES BETWEEN THE DEMOCRATS' PATIENTS' BILL OF RIGHTS AND THE
REPUBLICAN HMO PROPOSAL
The SPEAKER pro tempore. Under the Speaker's announced policy of
January 7, 1997, the gentleman from New Jersey (Mr. Pallone) is
recognized for 60 minutes as the designee of the minority leader.
Mr. PALLONE. Mr. Speaker, this evening I would like to spend some
time talking about the issue of managed care reform, or HMO reform. I
wanted to start out by pointing out that the House Republican leaders
brought a bill to the floor about 2 weeks ago which they are trying to
use to essentially dupe Americans into believing that they are
protected against HMOs, when in fact, if anything, the Republican bill
makes people's situation with HMOs even worse off, in my opinion.
There were no hearings on this Republican bill. It never went through
any congressional committee, and it was literally changing up until the
very last minute, when it came to the floor of the House of
Representatives.
For months Republicans have been working hand-in-hand with insurance
companies to fight the Democratic alternative, the Patients' Bill of
Rights, which is a real patient protection bill, which enjoys the
strong support of doctors, nurses, and consumer advocates.
Now all of a sudden the Republicans have rushed their bill, which
they call a patient protection bill, to the floor in an effort to solve
the political problem that their opposition to managed care reform has
essentially become. Mr. Speaker, make no mistake, the differences
between the Democratic Patients' Bill of Rights and the Republican HMO
proposal are significant.
The Republican bill excludes key provisions that are essential for
consumer protection, and includes provisions that would reduce current
consumer protections. The Republican HMO plan seeks to give the
appearance of reform without the reality.
Just to mention, among other things, some of the most serious
problems with the Republican HMO plan, it leaves medical decisions in
the hands of insurance company accountants instead of doctors. It does
not limit HMOs and insurance companies' use of improper financial
incentives to limit needed care. It allows drive-through mastectomies,
and fails to contain a requirement of coverage for reconstructive
surgery after mastectomies.
It does not give access to specialty care when needed. It also does
not guarantee patients access to needed drugs or clinical trials. Most
important, it provides no effective mechanism to hold plans accountable
when plans abuse, kill, or injure someone.
Democrats have been insisting and will continue to insist on a bill
that contains guarantees that are a significant gain for health plan
consumers. The Republican plan, by contrast to the Democratic plan, is
essentially a sham in providing patient protections.
Mr. Speaker, I wanted to talk for a few minutes, if I could, about
some of the specific problems that I see with the Republican HMO plan,
and give some examples of how they essentially would not help.
For example, one of the most important provisions in the Republican
bill that contrasts it from the Democratic Patients' Bill of Rights is
that the Democrats' Patients' Bill of Rights insures access to
specialists, whereas the Republican plan does not.
For example, under the Democratic bill, if you had cancer, you could
go directly to an oncologist. If your child had a specific problem, you
could bring your child to whatever type of specialist your child might
need. Under the Republican plan, you would still have to go see your
primary care physician for a referral, and there is no guarantee that
you would get to see a specialist if you needed one.
The differences between the two bills are even more pronounced when
it comes to seeing specialists outside your HMO, outside your network.
The Democrats' Patients' Bill of Rights ensures you will be able to go
outside your network at no cost to you if you need to see a specialist
that your HMO does not have within the network. But under the
Republican bill, if you need to see a specialist outside of your
network, you are out of luck. You do not get to see him.
Another difference between the access each bill would provide is what
we call ``standing referrals.'' If you were fortunate enough to be in
an HMO that has the type of specialists you need when you get sick
under the Republican plan, you still have to jump through hoops. The
Republican plan does not allow patients who need care over a long
period of time by a specialist to have standing referrals. The
Democratic bill, the Patients' Bill of Rights, does not require
patients to go back time and again to renew referrals. If you need to
see a specialist over a long period of time, you are guaranteed the
right to that doctor.
The Democrats' Patients' Bill of Rights will also let you designate
the specialist as your primary care physician. If you are a woman, you
can choose your OB-GYN as your primary care physician. The Republican
bill, by contrast, neither allows you to designate your specialist as
your primary care physician nor your OB-GYN.
Another major difference, and I think it is important, refers to
access to physicians, again. That is, what the two bills do to protect
the continuity of care.
The Democrats' bill ensures that if you were in the middle of
treatment and your plan drops the doctor that you were seeing or your
employer switches insurance companies, that you will still be able to
see that doctor at no cost to you. But under the Republican bill, if
you are a woman in your last trimester of pregnancy, for example, you
could be forced to see another doctor once that doctor is dropped from
the plan. The same goes for any patient in similar circumstances.
The differences in ensuring access between the two bills is not
limited to just physicians. Under the Democrats' Patients' Bill of
Rights, health plans are required to have a process for allowing
certain patients to participate in a defined set of approved clinical
trials.
For many patients, clinical trials represent the last and only hope
they have of surviving. But the Republican plan provides no access to
clinical trials at all. If you are in an advanced stage of breast
cancer, for example, the Democratic bill would give you not only the
opportunity but the resources to fight that horrible disease. I do not
see how the Republican bill does anything of the sort.
One last difference I would like to point out in terms of access is
access to needed drugs. The Republican plan does not guarantee that
your HMO will pay for the drugs your doctor prescribes. If your doctor
prescribes you a drug that is not on your HMO's approved list of drugs
under the Republican plan, you will have to pay for it yourself. If it
is too expensive for you, that is too bad. Even though you have health
care, you find the prescribed remedy out of reach because the health
plan you pay for refuses to cover it.
The Democrats' Patients' Bill of Rights, on the other hand,
guarantees access to whatever medication your
[[Page H6984]]
doctor determines that you need. The Democrats' bill requires plans
that have a limited set of drugs available to provide patients with
access to drugs that are medically necessary.
As I said, Mr. Speaker, really, the facts tell the story. When we
compare these two bills, we find there is no comparison at all.
Basically, the Republican bill does little to expand access and a lot
to protect the insurance industry. Really, I think we should be helping
patients get the care they need without the red tape and without the
added trauma of wondering just how much sicker they are going to get,
and have to wait for some bureaucrat somewhere to tell them they can
see a doctor or have the medicine they need. If we want to address
those problems, then we have to pass the Democrats' Patients' Bill of
Rights.
I wanted to mention another area that I consider a very important
difference between the two bills. Then I will try to wrap up what I
have to say tonight. That is, in my opinion, one of the most important
aspects. That is the issue of enforcement.
The point is clear that under the Democratic proposal, the Patients'
Bill of Rights, we are getting certain patient protections. Under the
Republican bill, we are getting very few patient protections. Even if
there were some patient protections that were important under the
Republican bill, it does not mean anything if we cannot enforce those
patient protections and make sure we get them. Any legislation that
fails to give patients the right of enforcement essentially renders the
protections within the bill absolutely meaningless.
The Democratic bill, most importantly, repeals the ERISA exemption.
This is the 1974 law that shields HMOs from being sued if they deny
people needed care. A lot of people do not realize that if your
employer has a self-insured plan, which many people have, and they fall
under ERISA, which is a Federal law, that basically says that the HMO
cannot be sued if it denies people care.
We repealed that, essentially, effectively, in the Democratic bill.
The Republican bill, however, does nothing to hold HMOs accountable for
their actions. It not only leaves ERISA essentially intact and still
has the prohibition on suit, it actually exacerbates the problem,
because its external appeals process, in other words, the ability to
appeal the denial of care, only applies to people whose insurance comes
under ERISA.
Individuals in the private insurance market are left without any
external recourse when they are denied care, and what is even worse is
that those who were fortunate enough to be covered by ERISA are subject
to the HMOs' definition of ``medical necessity.''
I just wanted to talk a little about that, because it goes to the
whole issue of enforcement. What the Republican bill does, it allows
the HMOs, and not the doctors and patients, to define ``medical
necessity.'' Of course, this provision flies in the face of the whole
idea of the managed care reform debate, that ``medical necessity''
should be the determinant of whether or not a patient needs care, and
not cost considerations.
So if we are really going to make reforms in HMOs and managed care,
we have to make sure that doctors and patients decide what type of care
is necessary, whether you have to stay a few extra days in the
hospital, whether or not you need a certain procedure. But if the
insurance company bureaucrats continue to make those medical decisions,
people will continue to be denied care. That is what is going to happen
with the Republican bill, because it lets the HMOs and not the doctors
and patients define what is a ``medical necessity.''
I also want to dispel a myth that my Republican colleagues have been
working overtime to spread. That is that the Democrats' Patients' Bill
of Rights does not create any new Federal litigation.
{time} 2200
In other words, if you repeal ERISA, as we do, all that allows is for
individuals to go back to the States and bring the kinds of suit they
would normally be able to bring. So we are not really creating a new
Federal remedy by repealing ERISA and allowing people to sue. We are
just allowing people to exercise the rights that they would normally
have if the Federal Government had not prohibited them from bringing
suit under ERISA.
Some of the other points that could be made with regard to
enforcement of the Republican bill I do not think I need to go into
tonight. I just want to stress again that if you have patient
protections and you cannot enforce them, either through some external
review process or through the ability to go to court and bring suit,
then for all practical purposes, whatever patient protections you have
under the Republican bill really are meaningless.
If I could, Mr. Speaker, the last thing that I wanted to bring up
tonight is the whole issue of cost, because I know that my colleagues
on the other side of the aisle continue to talk about how if we put in
place the Democrats' Patients Bill of Rights, which is a comprehensive
patient protection act, that somehow it is going to cost more and it is
going to drive the cost of HMOs up. Nothing really could be further
from the truth.
We had the Congressional Budget Office do an analysis, if you will,
of the Democrats' Patients Bill of Rights. What they basically said is
that the legislation would have a very minimal effect on premiums with
most individuals paying only about $2 more per month. Keep in mind that
for an extra $2, and it probably would not even be that much, you are
going to get the return of medical decisionmaking to patients and
health care professionals and not insurance company bureaucrats. You
are going to get access to specialists, including access to pediatric
specialists for children. You are going to get coverage for emergency
room care. You are going to get the right to talk freely with doctors
and nurses about every medical option. You have an appeals process and
real legal accountability for insurance company decisions, and you have
an end to financial incentives for doctors and nurses to limit the care
that they can provide.
These are the kinds of patient protections that we are providing with
the Democratic bill. I know that when I talk to most Americans, and
certainly, or most of my constituents, and certainly the polls have
shown both Democratic and Republican polls, that when you talk to most
Americans, they would rather have those protections. They would like to
be able to go to the emergency room nearby and not have to worry that
they are not going to be approved because they did not get a referral
or that they have to go to an emergency room 50 miles away. They do not
want the doctor to be gagged as some doctors are now with HMOs and told
they cannot even tell you about certain medical options.
They do not want doctors and nurses to be under a regime where if
they do not meet assert quota, if they do not deny a certain number of
cases or a certain number of procedures, that they will not get paid
enough for their work. We know that the average American would not mind
paying an extra dollar or two per month to have the kind of protections
that we are talking about here tonight.
Mr. Speaker, I would just say, in conclusion, that, of course, the
Republican bill passed the House of Representatives a couple weeks ago
but very narrowly. The Democratic proposal, the difference between the
two was only about 5 votes. I think that shows very strong support in
this body for strong patient protections that are enforceable. I only
hope that when the legislation goes over to the Senate and that when
the Senate reconvenes in September, the Senate will take up the
stronger Democratic bill and that we will see a strong bill pass this
Congress, pass both houses of this Congress, because President Clinton
has said over and over again that if he gets the Republican version on
his desk, he will veto it because it essentially does not provide the
type of patient protections that we need to really have some
significant managed care reform.
If it is necessary for the legislation to come back to the House or
back to the Senate after the President's veto, we know that we are
going to have the support here to pass a strong bill because of the
vote that took place on the floor of the House of Representatives two
weeks ago.
I see one of my colleagues is here who has been a strong supporter of
the
[[Page H6985]]
Democrats' Patients Bill of Rights, who is a member of the Committee on
Commerce, the gentleman from Texas (Mr. Green), where they have on the
State level passed very strong patient protections, but one of the
things that we know, because New Jersey, my State, is another State
that has passed State legislation that provides strong patient
protections, but unfortunately many people are not covered by State law
because, again, of the ERISA statute that I mentioned previously.
ERISA, which applies to all employers that essentially self-insure,
that is a big group in this country, ERISA essentially preempts State
law. So that is the reason why, one of the reasons why we have to pass
Federal legislation for even those States that do have strong patient
protections to make sure that everybody is covered. Of course, also to
take care of the States that have not passed strong patient protection
legislation. That is why we need comprehensive Federal legislation.
I yield to the gentleman from Texas (Mr. Green).
Mr. GREEN. I thank my colleague from New Jersey for allowing for this
special order this evening and asking for the time, and I thank the
gentleman for yielding to me.
I want to make a few points, because I think the gentleman led into
the concerns I had with the bill that we passed, literally, on the
Friday of the tragedy that occurred here in the Capitol, make a few
points about the Republican majority bill, a bill that we talked about,
the Democratic plan actually had bipartisan support. The Republican
bill would do to state passed, State protections like Texas has done,
and share with you some of the concerns that have been raised by
officials in my home State.
Very simply, it would destroy some of the local initiatives that we
have seen in the State of Texas. I do not know if that is true in New
Jersey or other parts of the country, but the Republicans so-called
Patient Protection Act would really be called the Patient Protection
Elimination Act.
First, let me refer to a letter from our State comptroller, John
Sharp. He writes, literally on July 29, after the bill was passed, The
following question should be asked of anyone considering supporting
this bill, the HMO reform conference committee report. Will the Federal
legislation preempt Texas's current managed care protection laws? Will
Federal legislation preempt Texas' HMO Legal Accountability Act? Is
there a Federal floor that States may improve upon, or will new Federal
legislation create a ceiling and preempt Texas from enacting tougher
patient protection laws?
For example, would the Federal legislation erase the Texas gag clause
legislation as well as the gag clause legislation in other States and
provide a weaker substitute nationwide? Does the Federal legislation
preempt Texas OB/GYN direct access bill and substitute weaker language
that permits direct access for routine care? Will the Federal
legislation be the final word on managed care accountability, or will
Texas and other States experiment with different kinds of approaches
such as their own external review process?
Because, again, this is quoting from John Sharp, Comptroller of
Public Accounts, I will put it into the Record. I am reading from the
verbiage because the Gingrich supported HMO reform legislation is
silent on many more kinds of patient protections enacted into Texas.
Are those protections also preempted or nullified by this legislation?
Will this proposed bill erase Texas laws protecting patients and
doctors from retaliation by a plan or due process provisions for health
care providers or continuity of care that guarantees after a provider
has been deselected?
These are just a few of the questions that Comptroller John Sharp
raised. We just received this letter today. It was dated at the end of
last week and, again, because of the tragedies that we saw here happen
that Friday afternoon, I do not think a lot of Members have thought
about what Congress did pass that day.
Let me talk about a letter from a person who I served with when I was
a State representative and a State Senator. John Smithee is a
Republican State representative from North Texas, Armstrong, Deaf
Smith, Oldham and Randall Counties which is very far north in Texas.
He writes, again on the 22nd of July, We are writing to respectfully
urge, and he is writing not only himself but also David Sibley,
chairman of the Senate Committee on Economic Development for the State
of Texas, and John Smithee is the chairman of the House Insurance
Committee and, by the way, both these members in the legislature in
Texas are Republican members.
And they write, we are writing to respectfully urge that in the
course of your deliberations on managed care and patients rights, you
do not disturb the substantial progress already achieved in Texas. As
chairman of the committees of jurisdiction over insurance and managed
care in Texas, we have presided over hundreds of hours of public
hearings on every conceivable aspect of managed care. I doubt there is
an argument or threat that we have not heard in the course of the
legislative lobbying, advertising or debate. The 75th legislature, the
one this 1997, both Representative Smithee and Senator Sibley
cosponsored the legislation and, along with many other colleagues in
their House and Senate, some of the most comprehensive and sweeping
managed care reforms in the country. They have not had the opportunity
to review fully the Federal managed care legislation that was selected,
scheduled for debate in the House, but judging from the news reports
and their own preliminary analysis it appears that the deliberations
are following an identical pattern as the debate in Texas, especially
regarding medical liability.
While we intend to provide a more detailed analysis of the impact as
it proceeds to conference, we respectfully submit the following
observations.
HMO accountability. The Texas legislature, in 1997, in a strong
bipartisan display established a legal duty on the part of managed care
organizations to exercise ordinary care when determining medical
necessity. Aetna Insurance filed suit against the State of Texas
claiming that the Senate bill was preempted by Federal ERISA. Ideally,
Federal legislation should clarify ERISA does not preempt a State's
right to determine health plan accountability and quality.
If such clarification is not achievable, we suggest that the Texas
congressional delegation push for Texas as a designated national pilot
project for 3 years so the experiences can be measured and evaluated by
future Congresses. We know what happened on that Friday and we know
that there are cases where the experiments and the innovative
techniques that a lot of our States are using, particularly Texas, will
not stand the muster of the bill that passed this House.
Also they ask for an independent review in item 2. It is our
understanding that H.R. 4250, the House GOP bill, would weaken Texas
independent review provisions. Again, these are a Republican State
Senator and a Republican member of the State legislature, State House.
Apparently H.R. 4250's independent review is not binding compared to
Texas law that requires managed care organizations to provide the care
deemed appropriate by the independent review organization. Once again,
the Texas legislature's preference in this regard was overwhelmingly
stated in 1997.
Number 3, this is the last one of Representative Smithee and Senator
Sibley's letter. We are also concerned that H.R. 4250 weakens current
Texas law regarding emergency care and gag clauses. As we understand
it, the bill waters down Texas prudent layperson by allowing a health
plan to override the treatment decision by the emergency department
physician. The gag clause provision does not protect health care
providers from retaliation when they act as advocates for their
patients.
They end it by saying, we know you are hearing from many points of
view on managed care. Thank you for considering our comments on Texas
law. And that copy was sent to Governor Bush and also to the whole
Texas delegation.
My concern and a lot of Members' concern is what the House passed as
HMO is a sham. What it is actually doing is taking a step backwards
from States who have made efforts to try and control it in their own
States, like Texas has and I think New Jersey has and other States. So
what we are doing
[[Page H6986]]
is taking away States' rights. It is ironic that as a Democratic member
that I am concerned about Congress taking away States' rights, but that
is what happened, I think, in H.R. 4250. And I am really surprised that
some of my Republican colleagues would allow that to happen here on the
floor when so often we talk about the importance of states being the
experimental, the embryo, the way to say, okay, we have a problem with
HMOs, we have a problem with education. Let us see what the States are
doing.
We have 50 laboratories out there. Yet in Congress, in H.R. 4250, we
are deciding what is best for the State of Texas and New Jersey, even
though those legislators made some tough decisions, as Representative
Smithee pointed out and Senator Sibley pointed out. They made some
tough decisions and went forward with it.
While many Republicans here in Washington keep saying real reform is
too expensive and would be too great a burden on insurance companies,
it is important to note that similar provisions in Texas raised
premiums only 34 cents per month per member. I would not mind going to
any constituent in my district and saying, for 34 cents, would you like
to have your doctor have the ability to talk to you about your health
care needs, even though your HMO may not cover it so we can eliminate
the gag clause? Would you really like to have a swift and sure external
and internal appeals process for 34 cents a month, 34 cents a month?
Would you really rather not have the decision made by you if you go to
an emergency room?
{time} 2215
If someone has chest pains and they go to that emergency room and the
doctor says, well, I am sorry, those chest pains were really gas. And
the doctor asks what they had for dinner, and they probably had some
good Mexican food that we have in Texas, and that probably caused them
to have gas. But that person could have been having a heart attack. But
for 34 cents people would be willing to pay to make that determination
themselves with that doctor in that emergency room.
That is why I think we need to continue to call the American people's
attention to what happened on that Friday here on the floor of this
House. The tragedy that happened outside these doors we all pray about
and we support those families, but I am concerned that what happened on
the floor of this House that Friday, with the passage of that bill,
will not only not help Americans but it will set back the States who
have made progressive efforts to try and provide that ability to their
patients and to their providers and their physicians: The right to sue
an HMO if they are inappropriately denied care; to have access to a
binding independent review; to communicate freely with the provider
without fear of retaliation against the doctor; and utilize emergency
room services if an individual experience symptoms that a prudent
layperson would consider an emergency.
And again, what does it cost? Thirty-four cents per patient per
month. We hear all sorts of huge costs. In fact, I heard from this mike
that day people saying how our bill does not cost anything. I heard it
time and time again. It doesn't cost anything because it takes away
rights. No wonder it does not cost anything. It takes away rights. We
do not get something for nothing, but for 34 cents under Texas law they
are providing those protections.
And I would hope that we would see our way clear that when this bill
goes to the Senate they would reform H.R. 4250, and maybe the
conference could even make some changes with the encouragement and
working with the administration. But I would hope when we get another
vote on that bill in a conference committee report that it will be a
much better product for our constituents than what we sent out here
that Friday that all of us regret the tragedy that happened that day.
And, again, I want to thank my colleague from New Jersey. I cannot
say it enough; that for the small cost that we are seeing in Texas for
these rights, why we cannot on this floor of the House do as well as
the State legislature in the State of Texas, why we cannot do as well
as the legislature in New Jersey and as well as many of the State
legislatures all over this country, because, as my colleague pointed
out, they only affect insurance companies that are licensed by the
State of Texas. They do not affect employers in my district who are
multi-State employers who have to come under Federal law because there
is a plan in Houston and a plan in New Jersey. They do not want to have
to comply with two laws.
So we need to provide those protections, and I again thank the
gentleman for allowing me to be here tonight and to speak.
Mr. Speaker, I provide for the Record the letters from both John
Sharp and John Smithee and David Sibley. I read most of them into the
Record, anyway.
The State of Texas,
House of Representatives,
Austin, TX, July 22, 1998.
Hon. Gene Green,
House of Representatives,
Washington, DC.
Dear Representative Green: We are writing to respectfully
urge that, in the course of your deliberations on managed
care and patients' rights, you not disturb the substantial
progress already achieved in Texas.
As chairmen of the committees that have jurisdiction over
insurance and managed care in Texas, we have presided over
hundreds of hours of public hearings on every conceivable
aspect of managed care. I doubt there is an argument or
threat we haven't heard in the course of legislative
lobbying, advertising, or debate. In the 75th Legislature, we
authored, along with many of our colleagues, some of the most
comprehensive and sweeping managed care reforms in the
country.
We have not had an opportunity to fully review the federal
managed care legislation that is scheduled for debate in both
chambers of Congress this week. But judging from news
accounts and our own preliminary analysis, it appears that
the deliberations are following an identical pattern as the
debate in Texas, especially regarding managed care liability.
While we intend to provide a more detailed analysis of the
impact of the congressional legislation as the bills proceed
to a conference committee, we respectfully submit the
following observations at this time.
1. HMO Accountability
As you know, the 1997 Texas Legislature, in a strong
bipartisan display, enacted S.B. 386, which establishes a
legal duty on the part of a managed care organization to
exercise ordinary care when determining medical necessity.
Aetna has filed suit against the State of Texas claiming that
S.B. 386 is preempted by federal ERISA. Ideally, federal
legislation should clarify that ERISA does not preempt a
states right to determine health plan accountability and
quality. If such clarification is not achievable, we suggest
that the Texas Congressional Delegation push for Texas to be
designated as a national ``pilot project'' for three years so
that the experience can be measured and evaluated by a future
Congress. We would respectfully urge you to oppose any
language that would jeopardize, weaken, or preempt Texas'
S.B. 386.
The extravagant claims about increased litigation and costs
are simply not true. In 1995 managed care reform opponents
called the patient protection act a billion-dollar health
care tax, and 1997 they claimed health care costs would
skyrocket upwards of 30 percent. However, multiple
independent studies, including an actuarial analysis by
Milliman and Robertson, of Scott and White's HMO, show costs
have increased by about 34 cents per member per month.
2. Independent Review
It is our understanding that HR 4250, the House GOP bill,
would weaken Texas' independent review provisions.
Apparently, HR 4250's independent review is not binding
compared to the Texas law that requires managed care
organizations to provide the care deemed appropriate by the
independent review organization. Once again, the Texas
Legislature's preference in this regard was overwhelmingly
stated in 1997.
3. Emergency Care/Gag Clauses
We also are concerned that HR 4250 weakens current Texas
law regarding emergency care and gag clauses. As we
understand it, the bill waters down Texas' prudent lay person
by allowing a health plan to override the treatment decision
by the emergency department physician. The gag clause
provision does not protect health care providers from
retaliation when they act as advocates for their patients.
We know that you are hearing many points of view on managed
care reform. Thank you for considering our comments on the
potential impact of federal legislation on Texas law. As the
legislation proceeds to conference committee, we will share
additional comments with you. In the meantime, please call on
us if we can be of assistance.
Sincerely,
David Sibley,
Chairman, Senate Committee
on Economic Development.
John Smithee,
Chairman, House Committee
on Insurance.
[[Page H6987]]
____
Office of the Comptroller,
Austin, TX, July 29, 1998.
Hon. Gene Green,
House of Representatives, Rayburn House Office Building,
Washington, DC.
Dear Gene: As State Comptroller, I am disturbed by the
special interests in Washington and their attempts to preempt
and weaken Texas' HMO patient protection laws.
You will recall that last year a bi-partisan effort in the
Texas Legislature succeeded in passing the nation's toughest
patient protection laws, including a new statute holding HMOs
legally accountable for wrongfully delaying or denying
necessary medical are.
Now it appears that House Speaker Newt Gingrich is trying
to help special interest groups in Washington preempt Texas
law and dilute our new patient protection laws.
As this issue moves into conference committee, I urge you
to support quality patient care in Texas rather than federal
legislation that preempts Texas laws protecting HMO patient
care.
I also urge you to guard against falling prey to the false
arguments against holding HMOs legally accountable for the
wrongful denial of necessary medical care. As State Senator
David Sibley emphasized in a recent opinion column (Dallas
Morning News, 7/25/98), Texas' new HMO liability law has not
flooded the courthouse with new lawsuits, but instead has
``actually diverted lawsuits and saved patients' legal
costs'' (see enclosure). As the state's chief financial
officer, I affirm Senator Sibley's observation.
The following questions should be asked by anyone
considering support for the HMO reform conference committee
report:
1. Will federal legislation preempt Texas' current managed
care patient protection laws?
2. Will federal legislation preempts Texas' HMO legal
accountability law?
3. Is there a federal floor that states may improve upon,
or will new federal legislation create a ceiling and preempt
Texas' tougher patient protection laws?
For example, will the federal legislation erase Texas' gag
clause legislation, as well as gag clause legislation in many
other states, and substitute weaker provisions?
4. Does the federal legislation preempt Texas' Ob/Gyn
Direct-Access Bill and substitute weaker language that only
permits direct access for ``routine'' care?
5. Will the federal legislation be the final word on
managed care accountability, or will Texas and other states
experiment with different kinds of approaches such as their
own external review process?
6. Because the Gingrich-supported HMO reform legislation is
silent on many more kinds of patient protections enacted in
Texas, are those projections also preempted or nullified by
this legislation? Will this proposal bill erase Texas laws
protecting patients and doctors from retaliation by a plan,
or due process provisions for health care providers, or
continuity-of-care guarantees after a provider has been
deselected?
These only raise further questions about this proposed
federal legislation. I encourage you in the strongest
possible terms to defeat this bill on the grounds that it
seeks to take away Texas' HMO patient protection. As always,
if I can provide further information and help in any way,
please do not hesitate to let me know.
Sincerely,
John Sharp,
Comptroller of Public Accounts.
Mr. PALLONE. Mr. Speaker, I want to thank my colleague from Texas
because he brought out a number of very important points, and when he
mentioned the minimal cost, the 34 cents per month, I am always happy
to mention the CBO saying that our Democratic plan would only be maybe
as much as $2 a month.
But I agree with the gentleman, I think it would even be less than
that. And the reason there would be no additional cost is, essentially,
these patient protections are things that make sense. They are common
sense proposals. And if an insurance company knows, if an HMO knows
that they have to provide these protections, they get involved in
prevention and they do not let terrible things happen. They do not deny
care that should be provided. So that avoids the extra cost that might
come from a lawsuit or damages or whatever because an HMO is not doing
what they are supposed to do.
So I think what we are really talking about are basic common sense
ideas and principles that can be easily provided for if the HMO is told
that they have to do it, and that is why it really does not cost any
more.
The other thing I wanted to mention that the gentleman brought out
was with regard to the preemption, which I think is so important. And,
yes, the same thing would be true in my home State of New Jersey. We
have very strong patient protections now on the books, similar to what
the Democrats have proposed with our Patients' Bill of Rights. And it
is quite clear when we look at the Republican bill that it would
preempt many of those very strong provisions in New Jersey, just as in
the State of Texas.
The reason for all this is that, as we talked before, this bill was
essentially drafted and put together by the Republican leadership in 1
week because they wanted to have a response to the fact that so many
people around the country are clamoring for managed care reform. There
are so many loopholes, so many problems, so many exceptions in this
bill. Whether because of poor drafting or intentionally because it is
basically the insurance companies that are writing it, essentially we
are taking a step backward. The Republican leadership would take us a
step backward with this legislation.
I know the gentleman mentioned a couple of things, and I wanted to
use them as examples, the kinds of loopholes that we have. The
gentleman talked about the gag rule, where doctors are told by an HMO
that they cannot talk about procedures or other means of doing things
that the HMO will not cover. That is the gag rule, as we talk about it.
Well, because of the complaints that the Democrats made, there were
some changes made in the Republican bill so that there were some gag
rule protections or some prohibitions on the gag rule. But when we
looked at the fine print, we found that it only applied to doctors who
were directly contracting with the HMO. But many physicians operate
through group practices and they are not covered by it, so they still
can impose a gag rule on those physicians.
The gentleman mentioned the emergency room care. Well, again, that
prudent layperson standard that we have in the Democratic bill says if
I get severe chest pains and there is a hospital a mile away, I go to
that hospital. I do not call for approval, and I do not go to the
hospital 50 miles away that the HMO may say I am supposed to go to.
Because the average person, prudent layperson, would not go 50 miles
and call to get approval to go to a hospital when they have chest
pains.
Well, the Republican bill says the HMO can define medical necessity.
So they could basically define a prudent layperson any way they want.
And one of the things in the Democratic bill is that that includes
severe pain. So if I have severe pain, I go to the local emergency
room. But the Republicans do not provide for that, so they can define
emergency care as not allowing for severe pain. Just an example.
I do not want to keep mentioning all these examples, but it is just
riddled with all these loopholes. And it is not really funny, I should
not be laughing, but it is pretty sad because, in many cases, what it
does is to preempt many good State laws and substitute very vague
language that really does not provide any protection.
I am glad that the gentleman brought that out this evening because I
think it is very important. I appreciate it.
Mr. GREEN. Again, I would like to thank the gentleman for this
special order, and I do not think it is too strong a language to say
that this bill that we passed, H.R. 4250, will not only not provide
improvements, but it will set us back in patient responsibility,
patient ability to be able to control their own destiny, physicians and
providers being able to treat their patients, and that is what is so
bad. I would hope that the American people will see what is happening,
and I think they will after not only special orders like these, but
also when we are back in our own districts.
I have town meet hall meetings in August and I expect to explain to
my constituents on how it works and what happened and how it is such a
travesty that the State of Texas passed a law in 1997, it was actually
passed in 1995, but it was vetoed by the governor then, and in 1997 it
became law without his signature, and yet we are taking away that local
legislature's ability to solve their problems locally.
Again, 34 cents. Let me talk about the GAO report that talked about
$2. I know that was an amount I used in the example for the price of a
Big Mac, maybe a Supersized Big Mac now, that we could get these
protections. Yet in Texas it is 34 cents. Thirty-four cents a month. So
we are going to see cost estimates all over the board because it is
hard to decide it. But, actually, in the State of Texas, the
protections have been in effect and it costs 34 cents.
Mr. PALLONE. The amazing thing that my colleague brings out about the
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preemption is usually, for most protections or legislation that is of a
protective nature for health or safety on a Federal level, the Federal
law reads that if the State wants to be more protective of the health
or the safety or the environment, or whatever it happens to be, that
they can do so. It is amazing that this bill does the opposite.
This Republican bill says that if we are more protective of the
patient's health, then we are going to preempt that and the Federal law
is going to hold. Usually we do the opposite, as the gentleman knows.
So, again, there is clearly an effort here to do what the insurance
companies want rather than do what not only is right, the right thing
for the average person, but also what the norm is here when we deal
with health and safety and environmental and other protections of that
nature. So we know there is sort of a cynical side to this Republican
bill in terms of what they are trying do.
The gentleman mentioned another thing that I think is important, and
I have talked all evening about the Patients' Bill of Rights being a
Democratic bill. But the fact of the matter is there are Republicans
who not only cosponsored the bill but voted for the bill on the floor
of the House and voted against the Republican bill. What the Republican
bill is is a Republican leadership bill. There are Republicans who
would join us in a bipartisan fashion, which is another indication of
why the Patients' Bill of Rights really is a good bill. It is
bipartisan. But, unfortunately, the Republican leadership is opposed to
it.
I want to thank the gentleman again.
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