[Congressional Record Volume 145, Number 102 (Monday, July 19, 1999)]
[House]
[Pages H5826-H5829]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                               HMO REFORM

  The SPEAKER pro tempore. Under the Speaker's announced policy of 
January 6, 1999, the gentleman from Iowa (Mr. Ganske) is recognized for 
60 minutes as the designee of the majority leader.
  Mr. GANSKE. Mr. Speaker, here we are again. Another week has gone by, 
and the House of Representatives, United States of America, has done 
nothing to address HMO abuses in this country.
  Of course we had, Mr. Speaker, a big debate on the other side of the 
capital last week, and I want to talk a little bit about that, that 
bill that passed, because I think that my colleagues on both sides of 
the aisle will need to educate themselves on some of the details of 
that bill that passed the Senate last week.
  I think we may be looking at that bill in the near future. I hope at 
least we will be looking at some bill on the floor in the near future. 
After all, it was about 2 weeks ago that the Speaker of the House told 
me personally that it was his intent to have HMO reform legislation on 
the floor by the middle of July.
  Well, Mr. Speaker, I am looking at my dates here, and here we are, it 
is past the middle of July; and furthermore, we are going to find time 
this week to debate a tax bill and other bills, and there is nothing in 
sight to even be having a committee markup in the Committee on 
Education and the Work Force or in the Committee on Commerce on HMO 
reform.
  It is not exactly, Mr. Speaker, like we have not been dealing with 
this issue for the last 3 or 4 years in Congress. It is not exactly as 
if earlier this year we were overworked here on the floor when we were 
naming post offices. Mr. Speaker, I think it is time that we get this 
issue to the floor. There are people that are losing their lives and 
losing their limbs and their health is being injured because HMOs are 
making medical decisions that are not in the best interests of their 
clients, their patients.
  Mr. Speaker, I want to talk specifically about some of the provisions 
that are in Senate bill S. 1344, which passed last week in the Senate, 
because, Mr. Speaker, I have the bill here, and I have been reading 
through this bill, and you know, there is an old saying here in 
Congress: the devil is in the details. You can have awfully good 
headings, Mr. Speaker, but once you start looking at the language, you 
can find out that it comes up rather empty.
  So let me just go over a few problems and deficiencies with the bill 
that passed the Senate last week.
  Now a couple years ago we here in the House, the other body, passed a 
bill for Medicare and Medicaid recipients that was signed into law by 
President Clinton. It said that if you were having a chest pain, severe 
chest pain in the middle of the night such that a prudent lay person 
would say, hey, that could be a heart attack, you could go to the 
nearest emergency room and be treated, and your health plan would be 
responsible for covering the cost because we know from the American 
Heart Association that if you delay prompt treatment, diagnosis and 
treatment of a heart attack, you could be dead before you get your 
treatment; and unfortunately many HMOs have said, as my colleagues 
know, you could go to that emergency room, but if they find out that 
instead of having a heart attack that you just had a severe case of 
inflammation of your esophagus, for instance, well, that proves that 
you did not have a heart attack and we are not going to pay for it.
  The problem with that, Mr. Speaker, is that once that information 
gets out, people are a little bit hesitant to go to the emergency room 
when they have crushing chest pain because they think, oh, my goodness, 
what if I am not having a heart attack? Then I could be left with 
thousands of dollars of bills. So maybe I will just be a little extra 
careful, and I will just stay at home here sweaty, really sick, until I 
am really sure that I have a heart attack.
  Mr. Speaker, we wanted to fix that. We did that in Medicare and 
Medicaid. We passed what is called a lay person's definition of an 
emergency, and we told the Medicare health plans that you have to cover 
those services if a patient goes to the emergency room.
  Mr. Speaker, you would think that it would not be too difficult to 
get the language right in a patient bill of

[[Page H5827]]

rights that would apply to all Americans, the same as we have for those 
who are elderly in Medicare or those who are poor in Medicaid. After 
all, people are spending a lot of money for their health insurance, it 
ought to be worth something if one did wake up with that case of 
crushing chest pain in the middle of the night.
  You would think it would not be too hard to simply take that language 
that we did in Medicare and put it into a bill that would apply to all 
Americans. That should not be difficult, should it? I mean, that is 
actually not one of the more contentious issues. But no, no, S. 1334, 
as reported, could not get that right either.
  Let me give you an example. The bill fails to guarantee that health 
plans will cover emergency care at the nearest hospital. That should 
not be so difficult. If you do not take my word, just take my word for 
it and read Page 7, Line 1 through 20. The bill that passed the other 
body last week would allow plans to refuse to cover emergency services.
  What are the details? Well, look at Page 8, Lines 3 through 7. The 
plan's obligations to pay for cost of treatment for stabilization, 
maintenance ends when the plan contacts the provider to arrange for 
discharge or transfer even if in the opinion of the treating physician 
the patient is not ready for transfer.
  Or how about the provision that would allow plans to shift the cost 
of refusing to pay for emergency care to the health providers? That is 
Page 8, Lines 8 through 14. I mean, that should be a relatively 
noncontentious issue, but they could not get it right. They could not 
get it right. They had to write a bill that was an HMO protection bill 
for emergency provisions.
  How about gag rules that HMOs have had in their contracts that say 
before you, the treating physician, can tell your patient all of his 
treatment options, you first have to get an okay from us, the health 
plan. Now think about that.

  Now say a woman goes to her treating doctor, she has a lump in her 
breast. The doctor takes the history, the physical exam, and then he 
says, excuse me, leaves the room, has to get on the phone, phone the 
HMO and says, You know, I have Mrs. So and So. She has a lump in her 
breast, and she has three treatment options. I would like to tell her 
about all three treatment options.
  And the health plan says, well, you know, according to our definition 
we only cover two of those, so we would rather not have you tell that 
patient about the third one because she might want it, might be 
appropriate for her.
  Those are what are called gag clauses in contracts. Mr. Speaker, once 
again a couple years ago we passed a Medicare, a Medicaid rule that 
forbade those types of impediments to communications between their 
health care providers and their patience, doctors and nurses and their 
patients. We said you cannot do that in Medicare; you cannot do that in 
Medicaid. Not a big deal. It has not added really anything significant 
to the cost of premiums. But it is an important reassurance to patients 
so that they know they are getting the whole story.
  Well, why could we not just take that language and put it into a bill 
that applies to all Americans? A bill that I have in the House here, 
the Managed Care Reform Act of 1999, does that; a bill that the 
gentleman from Michigan (Mr. Dingell) has, Patient Bill of Rights, does 
that; a bill that the gentleman from Georgia (Mr. Norwood) has does 
that.
  Could they get it right over in the other body? No, no. All they 
needed to do was add a few little words, but they are important words. 
They needed to add a provision that said all current contractual 
language prohibiting health communications is null and void. Could not 
do it. Could not force themselves to buck up to the HMOs on that.
  Mr. Speaker, let me tell my colleagues what the two really big 
problems were with the bill that passed the other body last week, and 
that has to do with the definition of medical necessity and who gets to 
define that and whether you have an enforcement provision to make all 
of the other provisions in the bill mean anything.
  Now, before I go into the language of S. 144, let me just set this up 
for my colleagues a little bit and tell them about testimony that a 
medical reviewer for an HMO gave before the Committee on Commerce.

                              {time}  2145

  It was May 30, 1996. A small nervous woman testified before the House 
Committee on Commerce. Her testimony came at the end of a long day of 
testimony about the abuses of managed care. This woman's name was Linda 
Peno. She had been a claims reviewer for several health care plans and 
she told of the choices that plans are making every day when they 
determine the medical necessity of treatment options.
  Here is her story, quote: I wish to begin by making a public 
confession. In the spring of 1987, I caused the death of a man. 
Although this was known by my people, I have not been taken to any 
court of law or called to account for this in any professional or 
public forum. Just the opposite occurred. I was rewarded for this. It 
brought me an improved reputation in my job and contributed to my 
advancement afterwards. Not only did I demonstrate that I could do what 
was expected of me, I exemplified the good company reviewer. I saved 
the company a half a million dollars, unquote.
  Well, it was clear to see her anguish over causing harm to patients 
as she testified. Her voice got husky. She continued, and the audience 
shifted uncomfortably and grew very quiet. The industry representatives 
and lobbyists who were there started looking at the floor and shifting 
their eyes.
  She continued. Since that day, I have lived with this act and many 
others eating into my heart and soul. For me, a physician is a 
professional charged with the care of healing of his or her fellow 
human beings. The primary ethical norm is, do no harm. I did worse. I 
caused death.
  She continued. Instead of using a clumsy, bloody weapon, I used the 
simplest, cleanest of tools: My words. This man died because I denied 
him a necessary operation to save his heart. I felt little pain or 
remorse at the time. The man's faceless distance soothed my conscience. 
Like a skilled soldier, I was trained for that moment. When any moral 
qualms arose, I was to remember that I am not denying care, I am only 
denying payment.
  She continued. At the time, that helped me avoid any sense of 
responsibility for my decisions. Now I am no longer willing to accept 
the escapist reasoning that allowed me to rationalize that action. I 
accept my responsibility now for this man's death, as well as for the 
immeasurable pain and suffering many other decisions of mine caused.
  At that point, Ms. Peno described many ways that health care plans 
deny care, but she emphasized one in particular; the right to decide 
which care is medically necessary. She said, quote, there is one last 
activity that I think deserves a special place on this list, and this 
is what I call the smart bomb of cost containment, and that is medical 
necessities denials. Even when medical criteria is used by the health 
plan, it is rarely developed in any kind of standard traditional 
clinical process. It is rarely standardized across the field. The 
criteria are rarely available for prior review, review by the 
physicians or members of the plan, and we have had enough experience 
from history to demonstrate the consequences of secretive unregulated 
systems that go awry.
  The room was stone cold quiet, and the chairman mumbled, thank you.
  Well, Mr. Speaker, I wish that this were an isolated instance, but I 
can say what health plans are doing around the country. Under Federal 
law, under Federal law called the Employee Retirement Income Security 
Act, passed 25 years ago, employer health plans can define medical 
necessity in any way they want to. Let me give you an example.
  There is a health plan in Texas that has defined medical necessity as 
the cheapest, least expensive care as determined by us, the health 
plan. Think about that. The cheapest, least expensive care as 
determined by us.
  Well, Mr. Speaker, before I came to Congress I was a reconstructive 
surgeon. I took care of children who were born with birth defects, 
birth defects like cleft lips and palates. This is an anomaly that 
occurs in about one in

[[Page H5828]]

500 live births. The child is born with a big hole right in the middle 
of their face. Their lip is separated. They have a big hole in the roof 
of their mouth. It needs to be surgically corrected. That is the 
standard treatment, surgical correction.
  But, Mr. Speaker, under Federal law, instead of a surgical correction 
of the roof of that child's mouth so that that child can learn to speak 
normally, so that that child does not have food coming out of their 
nose, that health plan, under their own contractual definition of the 
cheapest, least expensive care, under Federal law, could say, well, we 
are just going to provide a little piece of plastic, kind of like an 
upper denture, that will keep some of the food from going up. After 
all, that is the cheapest, least expensive care.
  I do not think very many people in the public understand this. I do 
not think many people understand that by Federal law we have told HMOs 
that provide insurance under employer plans that they can determine any 
type of medical necessity they want, whether it meets prevailing 
standards of care, whether it has anything to do with the medical 
literature, whether it follows NIH guidelines, standard care for 
treatment, for cancer treatment. They do not have to follow it because 
they can write a little definition in their own health plan and under 
Federal law that is all they have to follow.
  So I get back, Mr. Speaker, to the bill that passed the Senate last 
week, after a lot of partisan debate, but the underlying problem with 
that bill is this: I urge my colleagues to look at page 116 in the bill 
that passed the Senate, where it is dealing with external review where 
an independent panel could review denials of care.
  What can that independent panel under that bill review? Items or 
services that would have been covered under the terms of the plan or 
coverage if provided by the plan or issuer. In other words, Mr. 
Speaker, they are just reiterating what current law is. They are saying 
that independent panel, which is looking at a denial of care that could 
be lifesaving for a patient, at the end of the day the only thing one 
can appeal is whether the plan has followed its own definition of 
medical necessity. That is not reform. That is why that bill ought to 
be called the HMO Protection Act.
  I want to talk about something I have not talked about on the floor 
as it relates to this issue. This Congress may deal with an issue of 
physician-assisted suicide. There are people on both sides of that 
issue, but we have to remember what that debate is going to be like if 
we do not correct Federal law that says the HMO, in an employer plan, 
can decide what is medically necessary.
  Assisted suicide is now legal in Oregon, and there exists a natural 
cost incentive for health plans to support assisted suicide over other 
more expensive treatment options, according to Nelson Lund, professor 
of law at George Mason University. He is an expert on assisted suicide.
  Protecting patients from unscrupulous cost shifting is very 
difficult, he says Quote, it is very hard to think of a law that could 
make a distinction between legitimate cost cutting by an insurance 
company in long-term care and cancer treatments and an illegitimate 
cost reduction. Inevitably you have pressures develop. Unquote.
  Insurance companies can exert an enormous amount of pressure on 
health systems as a whole and on individual physicians, Professor Lund 
says. Quote, once strong incentives are created through cost cutting, 
through the managed care system, you naturally are going to get more of 
the cheaper treatments and less of the expensive treatments. That has 
to be true. That is why things are done, unquote.
  Mr. Speaker, although there are protections written into the Oregon 
law, I can guarantee that physicians will face subtle pressures to view 
patients' options as more limited than they otherwise may consider 
them. Lund says, quote, even though the law requires a diagnosis of 
less than 6 months to live, that is an incentive for the physician to 
say, this person only has 6 months to live.
  Once eliminating the patient is considered a form of treatment, the 
economic incentives are there that I think are unstoppable, quote/
unquote.
  That is part of the reason why we have to change this Federal law. 
Look, it may cost an HMO only $500 to get an opinion that this patient 
should have a physician-assisted suicide. There is primary care 
referral. There is a mental health evaluation and there are the drugs. 
$500 is a lot less expensive than taking care of a patient with cancer 
towards the end of their life.
  That is part of the reason why it is very, very important that this 
Congress, especially in the context of States looking at this issue of 
physician-assisted suicide, and I do not care whether one is on one 
side of the issue or the other side of the issue, nobody wants an HMO 
pushing providers to get rid of patients who may be expensive. That is 
why we need to have a definition of medical necessity, not determined 
by the plan as the cheapest, least expensive care but as something that 
would include looking at prevailing standards of care, looking at the 
medical literature, looking at NIH cancer treatment statements, 
consensus statements and, yes, looking at the health plan's own 
guidelines as long as they are peer reviewed.
  All of those things should be taken into consideration, but none of 
them should be determinative and should not be determinative that the 
health plan, as under current Federal law, can simply say this is it. 
We do not care whether someone can provide us with a table full of 
medical literature that says that that treatment is the standard of 
care and efficacious, because we did not define it that way.
  Well, that is one of the main things that, unfortunately, the bill 
that passed the Senate last week did not address. It simply allows 
those health plans to go on even in the independent external appeals to 
define medical care however they want to.
  What is the other big issue? The other big issue is whether those 
health plans should be responsible for those medical decisions that 
they make.
  Mr. Speaker, let me just give you one example of how an HMO made a 
decision that resulted in a tragedy. A couple of years ago, a young 
mother was taking care of her 6-month-old infant. A little baby boy at 
3:30 in the morning was really sick. He was hot, sweaty, temperature of 
104.
  Moms and dads can tell when their kids are really sick. So mom and 
dad thought he better go to the emergency room. So they phoned the 1-
800 number for the HMO. They get a voice a thousand miles away who 
says, yes, I will let you go to the emergency room but I am only going 
to authorize this one emergency room, and the mother said, well, where 
is it? And the reviewing voice at the end of the line said, well, I do 
not know. Find a map.
  Well, it turns out that it was a long ways away, 60 some miles away. 
Mom and dad wrap up little Jimmy, get in the car at 3:30 in the morning 
and start out on their trek.
  About halfway through the trip, Jimmy is looking sicker, but mom and 
dad are not health care professionals. They do not know that they need 
to stop right away, but they do know if they did stop at an 
unauthorized hospital they are now stuck with potentially a very big 
bill. This family does not have that kind of resources. Most families 
do not have that kind of resources.
  So they kept driving. They passed three emergency rooms that they 
could have stopped at. But they did not have an okay from the company. 
That company had made that medical decision, we are only going to allow 
you to go to that one hospital.
  Well, about 10 or 15 miles from that hospital little Jimmy's eyes 
rolled back in his head and he stops breathing. Picture dad driving 
like crazy to get to the hospital, mom trying to keep little Jimmy 
alive.
  They tear into the emergency room entrance. Mom leaps out of the car 
with little Jimmy, screaming save my baby, save my baby. A nurse comes 
out, gives him mouth-to-mouth resuscitation. They bring the crash cart 
out; they start the lines; they give him the medicines and somehow or 
another they get him back to life. That nurse blew the breath of life 
into little Jimmy again.
  Well, he was a tough little guy and he managed to survive, but 
because of that delay by that medical decision by that HMO and that 
cardiac arrest with the loss of circulation, little Jimmy

[[Page H5829]]

ends up with gangrene in both hands and both feet and they all have to 
be amputated.
  Little Jimmy today is learning how to put on his bilateral leg 
prosthesis, with his arm stubs. His mom has to help him put on his 
bilateral hooks. He is getting along pretty good for a kid who has lost 
both hands and both feet, but he will never play basketball.

                              {time}  2200

  I would tell the Speaker of the House that he will never wrestle. I 
would say that someday, when he gets married, he will never be able to 
caress the face of the woman that he loves with his hand.
  I hear the opponents of this legislation say, ``Ah, but these are 
just anecdotes. We do not legislate on the basis of anecdotes.'' I 
would say to them, this anecdote, if it had a finger, and you pricked 
it, it would bleed, if he had a hand.
  Do my colleagues know what? Under Federal law, that health plan is 
liable for nothing other than the cost of the amputations. Can my 
colleagues believe that? It is the only industry in this country that 
has blanket immunity of that nature.
  A judge reviewed this case. He determined that the margin of safety 
by that HMO for little Jimmy was, ``razor thin.'' I would add, as razor 
thin as the scalpel that had to amputate his hands and feet.
  Now, I ask my colleagues on both sides of the aisle, many of us in 
the past, we have talked a lot on this floor about responsibility. When 
we were doing welfare reform, we said, ``Do you know what. If you are 
able bodied, you can go out and get a job, and you can support your 
family. That is responsibility. We will give you some education. But 
then it is your responsibility to support your family.''
  There have been a number of times on the floor, this floor right 
here, where we have voted in a bipartisan fashion for the death penalty 
for somebody who has killed or raped one of our fellow citizens because 
we say that is responsibility.
  I think people need to examine their hearts. Conjure up in your mind 
the goddess of justice, Themis. She is holding the scales. She is 
blindfolded. Under current Federal law, she has written across her 
chiton ``HMOs do not need to follow justice.'' We need to fix that.
  There needs to be an enforcement mechanism. I looked at the Senate 
bill which passed last week, and do my colleagues know what the 
enforcement mechanism is? A $10,000 fine if it is found that the health 
plan followed its own definition of medical necessity. That is a joke. 
That is a travesty. To my colleagues, I say we need to fix that.
  This will not result in a huge number of lawsuits. Texas passed a 
law, a good law. It had a strong external appeals process. It did make 
the health plans responsible in the end. Do my colleagues know how many 
lawsuits they have had? One. And one or two are pending in the 2 years, 
not that explosion of lawsuits. It has not resulted in an explosion of 
premiums. Texas premiums are below national average.
  Before Texas legislature almost unanimously passed that law, the HMOs 
were saying, ``The sky will fall. The sky will fall. It will kill 
managed care in Texas.'' There were 30 HMOs in Texas at that time. 
There are 51 in Texas today. The President of Aetna described Texas 
today, after passing a strong patient protection law with liability 
provisions, he described Texas as the filet mignon, the filet mignon of 
States to have insurance in.
  Mr. Speaker, I have given my colleagues a couple of examples tonight 
of some of the abuses of managed care that have resulted in terrible 
personal tragedies. Picture little Jimmy as your child or your 
grandchild, and tell me, when you examine your heart, if you think HMOs 
under Federal protection should be shielded from the consequences of 
their negligence. I do not think so.
  Should we not have a strong appeals process, something that really 
means something so that an independent panel can determine medical 
necessity, not on the basis of some contorted contractual language 
definition that only serves the basis to increase the HMO's bottom line 
and profits?
  That is what we are dealing with, Mr. Speaker. We are dealing with a 
bill that, on the surface, if one looks at the surface headings, is 
called a patient protection bill. But when one reads the fine print, it 
is an HMO protection bill. It is worse than the status quo in many 
ways.
  I will be happy to share with my colleagues references, the page 
numbers, the line numbers of any of the statements I have made tonight. 
But I will tell my colleagues what, if this bill comes to the floor, 
and we bypass our committee process, then I think every citizen in the 
country should demand that their Representative know what they are 
voting on and that their Representative be accountable for improving 
the situation, not making it worse.

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