[Congressional Record Volume 145, Number 105 (Thursday, July 22, 1999)]
[Extensions of Remarks]
[Page E1642]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                    HOLDING MANAGED CARE ACCOUNTABLE

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                        HON. WILLIAM O. LIPINSKI

                              of illinois

                    in the house of representatives

                        Thursday, July 22, 1999

  Mr. LIPINSKI. Mr. Speaker, I rise today to bring an editorial from 
today's Chicago Tribune to the attention of my colleagues. The 
editorial is titled ``Holding Managed Care Accountable.'' I hope that 
my colleagues take the time to read this informative and interesting 
commentary.

               [From the Chicago Tribune, July 22, 1999]

                    Holding Managed Care Accountable

                         (By Philip H. Corboy)

       Chicago--John McCarron suggests that the best Congress can 
     do for America's health-care system is to do nothing 
     (``Medical malpractice? When Congress plays doctor, pray for 
     gridlock,'' Commentary, July 12). Perhaps some agree with him 
     that ``there's not much wrong with managed care.'' They may 
     not have experienced a major medical crisis and the chance to 
     see their HMO in action.
       Supporters of the Patients' Bill of Rights point to scores 
     of incidents around the country. Workers pay for medical 
     coverage for themselves and their families, then find that 
     needed care is delayed or denied--even over the objections of 
     their own doctors. Often the result is that the patient 
     suffers more serious harm, or even death.
       Mr. McCarron's argument that this is the employer's fault 
     for choosing the HMO is misguided. All managed-care plans 
     have strong financial incentives to minimize care and 
     maximize profits, which amounted to some $10.5 billion for 
     the industry last year. There is no disincentive to keep 
     administrators from interfering with patient care by denying 
     needed services, understaffing or imposing cumbersome 
     authorization requirements. Unlike every other private 
     business or profession, employee managed-care plans cannot be 
     sued and held accountable for the harm they cause.
       This unusual immunity is not something Congress intended, 
     or even considered. In 1974 the legislature passed the 
     Employee Retirement Income Security Act (ERISA), a 
     complicated statute designed to promote and to protect 
     employee pension funds. To avoid conflicting regulations, 
     Congress pre-empted state law. As a result if a plan denies 
     or delays testing for a premature baby at high risk for 
     retinopathy and the child becomes permanently blind, the 
     maximum amount of compensation that the parents can recover 
     is the cost of the test itself. To avoid this harsh result, 
     Congress should fix the problem it created.
       The industry's primary strategy in its fight to keep its 
     special immunity has been to frighten Americans with dire 
     predictions of a flood of lawsuits and skyrocketing premiums. 
     Fortunately Americans can see for themselves what happens 
     when managed care is made accountable.
       For example, ERISA does not apply to government workers. A 
     study by the Kaiser Family Foundation of approximately 1 
     million government workers in California from 1991 to 1997 
     found that only 20 had filed lawsuits. The study estimated 
     that permitting liability actions added only between 3 and 13 
     cents to each policyholder's monthly premium.
       In 1997 Texas enacted a statute that created an external 
     review for managed-care decisions and allowed patients to sue 
     their HMOs. The number of lawsuits that have flooded Texas 
     courts: three. The Texas Department of Insurance, the 
     designated external review board, predicted that there would 
     be 4,400 complaints in the first year. Only 531 were 
     registered, 46 percent of which were resolved in favor of the 
     patients. Texans' liability premiums are almost exactly what 
     they were in 1995.
       Missouri also chose in 1997 to allow liability suits. So 
     far there have been none. The experience in Texas and 
     Missouri suggests that the deterrent effect of legal 
     accountability has encouraged managed-care insurers to 
     provide better patient care.
       Doctors, unions and groups that represent patients, 
     consumers, veterans and seniors all support the Patients' 
     Bill of Rights. They want more accountability for managed-
     care plans. The industry claims that it needs immunity to 
     save money, which keeps premiums low. Yet in many cases delay 
     necessitates a much more expensive and risky course of 
     treatment.
       Congress should do something. Close the loopholes that 
     encourages managed-care bureaucrats and administrators to 
     interfere with doctors caring for patients.

     

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