[Congressional Record Volume 145, Number 133 (Tuesday, October 5, 1999)]
[House]
[Pages H9399-H9403]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




               CONTINUATION OF DISCUSSION ON HEALTH CARE

  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.
  Mr. GANSKE. Mr. Speaker, I appreciate the remarks of my colleagues 
from across the aisle as they relate to health care. I am going to 
continue the discussion on health care, and if my colleagues from Texas 
want to contribute to some of this, that would be just great; and I 
will be happy to recognize them periodically.
  Let us talk a little bit about how people receive health care in this 
country.
  So I have a chart here I want to share with my colleagues.

                              {time}  2130

  Let us just assume that this square represents all of the health 
insurance market, and the circle represents, both red and white in the 
circle, employer-based health insurance. So that you have about two-
thirds of employer-based health insurance, consisting of employers 
offering fully insured products, i.e., you have your small business 
that contracts with an HMO. About one-third of employer-based health 
insurance is what we call self-funded employer plans. Then you have, 
outside of the employer-based health insurance, you have health 
insurance that is provided by churches and certain nonprofit 
organizations, Medicare, Medicaid, public sector employees, i.e., 
government employees, both Federal and State, and you have individuals 
who buy insurance policies.
  Now, Congress passed a law related to pensions about 25 years ago 
called the Employee Retirement Income Security Act, and those people 
who receive insurance from their employer, those within the circle 
here, are under that law, the ERISA law.
  Now, about two-thirds of those employer-based programs are under both 
Federal and State regulation. To some extent states regulate those 
plans, but the white area here is totally regulated by the Federal law.
  The problem is in this area that frequently there are jurisdictional 
disputes between whether the State has the right to oversee those plans 
in some ways, or the Federal Government does, and that frequently ends 
you up in court fighting that out or with legal disputes. That needs to 
be clarified by Congress.
  But one thing is pretty clear, and that is that there has been a 
universal feeling that if you are in an employer-based plan, both the 
red and the white in this circle, that then you are shielded from any 
responsibility, any legal responsibility, for bad actions that could 
result from the medical decisions that your health plan makes. The 
health plan is shielded from their negligent actions. That is something 
we need to address here in a few minutes.
  Now, we are going to be debating in the next two days both a bill 
related to increasing the number of people in this country that are 
inside this square, i.e., those that have insurance, and we are going 
to be debating what quality of care those who are inside the circle 
receive.
  Let me speak for a minute about those that are off the chart, the 44 
million Americans that do not have health insurance.
  This number has gone up steadily over the last several years. As a 
percentage of the number of people in this country, however, it is 
staying about the same, about 16.2 percent. In other words, the number 
of people in our country is increasing as well.
  Who are those people who are not inside the box, that do not have 
health insurance? They are primarily the young, i.e., those between 18 
and 24, and the poor, and there is a sizable percentage of them who 
qualify for Federal programs already, but they are not enrolled.
  There are 11 million uninsured children in this country today. More 
than half of those children qualify for Federal programs to pay for 
their insurance, either through Medicaid or through what we call the 
children's health insurance plan, the CHIP program.
  Why are they not enrolled if they are qualified? Frequently it is a 
matter that the parents do not even know about it, or the states and 
Federal Government have not done a very good job in making sure that 
people who qualify take advantage of those benefits. That would go a 
long way. If you could reduce the number of uninsured children in this 
country by 5 million simply by getting those children into the programs 
that already exist, you have made a big dent in the number of 
uninsured. We ought to do that.
  We are going to be debating on the floor some tax measures, some 
measures related to changes in what are called association health 
plans; there will probably be some debate on medical savings accounts, 
some things like that.
  Some of those areas I agree with; some I have some problems with. I 
am worried that with the association health plan measure in the access 
bill that it could have unintended consequences to actually increase 
the cost of insurance for those who are, for instance, in the 
individual market, the individual health insurance market. 
Nevertheless, we are going to have a debate on that. I anticipate there 
will be some support for that bill from both sides of the aisle. Then 
we are going to have a debate on how to improve the health care for 
those people in this country who are already spending a lot of money on 
health care.
  But while I have this chart up here, I think it is useful to point 
out something, because there was a recent study by the Kaiser Family 
Foundation on the relative cost of lawsuits in comparing those people 
who are in the ERISA plans who are shielded, whose plans are 
shielded from liability, to those that are in non-ERISA plans where you 
can obtain legal redress against your HMO if they commit an injury to 
you or your loved one.

  Remember this: Government employees are in non-ERISA plans. That 
means that government employees have a right to sue their HMO. But if 
you receive your health insurance from your employer, either through an 
employer offering fully insured products, like HMOs or self-funded 
products, you do not.
  So this is a good comparison, the comparison on premiums and on the 
incidence of lawsuits between those that can sue, i.e., churches, 
people in churches or public sector employees or individuals, versus 
those that cannot.
  The Kaiser Family Foundation found out that the incidence of lawsuits 
in those who are in plans where you can sue is very low, and that the 
cost, the estimated cost for providing that right to those who do not 
have it, would be in the range of 3 to 12 cents per month per employee. 
That is a rather modest cost when you think about how that could 
prevent something truly awful.
  Let me describe a case that is truly awful. We have here a little 
boy, a beautiful little boy about 6 months old, and he is tugging on 
his sister's sleeve. His name is James.
  Sometime shortly after this picture was taken he became sick. At 
about 3 in the morning he had a temperature of 104 or 105, and his 
mother, Lamona, looked at him and she knew he needed to go to the 
emergency room because he was really sick. So she phones her HMO on a 
1-800 number and says, ``My little boy is really sick and needs to go 
to the emergency room.'' Some disembodied voice over a 1-800 telephone 
line who has never seen Jimmy Adams says, ``Well, I guess I could let 
you go, but I am only going to authorize you to go to one hospital that 
we have a contract with.'' The mother says, ``That is fine, where is 
it?'' The medical reviewer says, ``I don't know. Find a map.''
  Well, it turns out it is a long ways away, 70-some miles away, and 
you

[[Page H9400]]

have to drive through Atlanta to get there. So at 3 in the morning mom 
and dad wrap up little Jimmy and they start out in their truck. About 
halfway through they pass three hospitals that have emergency rooms, 
but, you know, they have not received an authorization from their HMO 
to stop there, and, if they do, their HMO is not going to pay for it.
  They are not medical professionals. They do not know exactly how sick 
Jimmy is, so they decide to push on. Unfortunately, before they get to 
the authorized hospital, I would say an unreasonably long distance from 
where their home is, little Jimmy has a cardiac arrest.
  So picture mom and dad trying to keep Jimmy alive in the car while 
they are driving like crazy to get to the hospital emergency room that 
has been authorized. They pull in to the driveway to the hospital, the 
mother leaps out holding little Jimmy screaming ``help me, help me,'' 
and a nurse comes running out and starts mouth to mouth resuscitation. 
They put in the IVs, they pump his chest, they get him moving, they get 
him going, the little guy is tough and he lives.
  Unfortunately, because of that medically negligent decision, that 
medical judgment by the HMO that caused the cardiac arrest before he 
got in a timely fashion to an emergency room, little Jimmy ends up with 
gangrene of both hands and both feet. No blood supply to both hands and 
both feet, and both hands and both feet turn black and dead.
  So, what happens? This is little Jimmy after his HMO care. Under that 
Federal law, the only thing that that HMO is liable for is the cost of 
the amputations of both his hands and both his legs.
  This little boy will never be able to play basketball. This little 
boy will never be able to wrestle. Some day, when he gets married, he 
will never be able to caress the cheek of the woman that he loves with 
his hand.
  I asked his mother how he is doing. Well, he is learning how to put 
on his bilateral leg stump, his leg prosthesis with his arm stumps, but 
he needs a lot of help in getting on his bilateral hooks. He is always 
going to be that way. He is doing great. He is a courageous little kid.
  But I ask you, how is it that when HMOs under employer systems are 
making medical judgments and decisions that can result in losing your 
hands and your feet, that the only thing those plans are responsible 
for is the cost of the amputations? Is that fair? Is that justice? If 
that HMO had known that they would be liable, they would have been much 
more careful, and they would have said, ``Take him to the closest 
emergency room,'' not 70 miles away. That would have helped prevent 
this.
  It is cases like this that have come before the Federal judiciary 
that has caused our Federal judges to be so frustrated, because the 
only recourse that Jimmy has at this point in time is the fact that the 
HMO paid for his amputations. That has caused some judges like Judge 
Gorton in Turner v. Fallon to say, ``Even more disturbing to this court 
is the failure of Congress to amend a statute that, due to the changing 
realities of the modern health care system, has gone conspicuously awry 
from its original intent.'' That statute that he is talking about is 
the Employee Retirement Income Security Act, ERISA, that 25 years ago 
was meant to be a plan that would protect employees in terms of their 
pensions.

                              {time}  2145

  It has been turned on its head as a protection for employers and for 
health plans, not for employees. Federal judges are saying, Congress, 
fix it.
  Judge Garbis, in the case Pomeroy v. Johns Hopkins, says the 
prevalent system of utilization review now in effect in most health 
care programs may warrant a revaluation of ERISA by Congress so that 
its central purpose of protecting employees may be reconfirmed.
  A judge looked at this case involving little Jimmy Adams. He reviewed 
the case. Do you know what he said? He said, the margin of safety by 
that HMO was ``razor thin.'' I would add to that, about as razor thin 
as the scalpel that had to cut off his hands and his feet.
  Judge Bennett, in Prudential Insurance Company v. National Park 
Medical Center, said, ``If Congress wants the American citizens to have 
access to adequate health care, then Congress must accept its 
responsibility to define the scope of ERISA preemption and to enact 
legislation that will ensure every patient has access to that care.''
  So I ask my colleagues on both sides of the aisle, but especially my 
colleagues, my fellow Republicans, do the right thing in the next 2 
days, and you will be fulfilling Republican principles.
  What are those principles? Those principles that we Republicans have 
talked about are individual responsibility. We have been for tort 
reform, we have been for States' rights, we have been for market 
reform. We have been for adequate enforcement on some of the 
legislation we have passed. We are all for fairness.
  Let me go into this in a little bit more detail. I do not know how 
somebody who has voted for welfare reform, where we say that if a 
person is able-bodied, that they have a responsibility to go out and 
work, to get an education to work and support their family, that is a 
Republican principle of responsibility. That was the major thrust of 
our welfare reform bill.
  Republicans have repeatedly on this floor, my fellow Republicans, 
myself included, said that if somebody commits murder or rape, then 
they ought to be responsible for that. How can we say that a health 
plan or an HMO which makes a medical decision that results in a little 
baby boy losing his hands and feet, that they should not be 
responsible? I do not know how one can justify his other actions. Do we 
only talk about responsibility if it does not involve some big special 
interest money? Let us think about this for a minute.
  How about the issue of tort reform? This is tort reform. This is 
fairness. When we have a system that is tilted, that is unbalanced, it 
creates distortions. What we are talking about is that there is no 
other industry in this country that has this type of liability shield.
  If an automobile manufacturer came to us and said, you know, I do not 
think under ERISA we should be liable for any of the bad things we do, 
or if an airplane manufacturer said that, I think they would get 
laughed off Capitol Hill. I mean, if they do a negligent action that 
cost the lives of our constituents, then they should be liable. They 
are not coming to us for that.
  So we have this bizarre situation where an organization which is 
making daily life and death decisions by a 25-year-old antiquated law 
that needs to be updated in one particular area has an exemption from 
responsibility for their actions.
  States' rights, let us talk about that for a minute. Today in our 
Republican Conference we had a discussion on patient protection 
legislation. I pointed out that a couple of the bills that will come up 
in the next 2 days seek to take away from State jurisdiction personal 
injury and move it into Federal courts.
  After we had a discussion about that, which I am going to discuss 
some more, I said, somewhat tongue in cheek, to a colleague of mine 
from South Carolina, I just, I just do not understand how a successor 
for John C. Calhoun, the major proponent of States' rights, how 
Republicans who have repeatedly said, hey, we need to get big 
government off your back and devolve power back to the States, and we 
have said that on education, we have said that on welfare, we have said 
that on all sorts of things, I do not know how a representative from 
South Carolina could be for moving this to Federal court under two of 
the bills that we will, I hope, defeat in the next 2 days. And my 
friend said, yes, but John C. Calhoun is dead. And a voice from the 
back of the room said, yes, but he passed away because of his HMO.
  Well, I think that when we are looking at States' rights, this is 
really important. Since the beginning of our Constitution, in the area 
of personal injury, this has been an issue that has been handled at the 
State level.
  My father managed a grocery store. What was one of the things he 
always watched out for? A grape on the floor in the produce department, 
because somebody could slip on a piece of produce and hurt themselves, 
and once in a while that happened. Once in a while then you had 
a lawsuit arise out of that. That is handled, if you are talking about 
any national retail chain, whether you are talking about

[[Page H9401]]

Target or whether you are talking about Wal-Mart, anything like that 
today is handled in your local State court. That is where it should be 
handled.

  But under two of the bills that we are going to be debating, the 
major thrust of the liability provisions is that you take those out of 
State jurisdiction and put them into Federal. That just stands our 
Federal-State relationship on its head. It would be the biggest 
usurpation of Federal big government power that I think I have ever 
seen in Congress, and unnecessary.
  What the bipartisan consensus managed care bill says is that when we 
have a problem that requires that you go to court because of a health 
plan's problem, you simply go back to State court, to a jurisdiction 
where it has always been in the past. We are not creating a new cause 
of action, we are simply returning it back to where it was before 25 
years ago.
  Why is that important? Well, when we are talking about the issue of 
Federal versus State jurisdiction, I would read this report by Chief 
Justice William Rehnquist, Chief Justice of the Supreme Court. He said, 
``This principle was enunciated by Abraham Lincoln in the 19th century 
and Dwight Eisenhower in the 20th century. Matters that can be handled 
adequately by the States should be left to them. Matters that cannot be 
handled should be undertaken by the Federal Government.''
  Do Members know what? I will bet there is not a single Congressperson 
here who has gotten a phone call from one of his constituents 
complaining that their State court has not been able to take care of 
those problems of personal injury. I do not think that we are going to 
find very many Congressmen that think that their States are not able to 
handle this, their State courts are unable to handle this. So the bill 
that I support simply says, return the jurisdiction to that.
  Look, if a State wants to pass a law like Texas did on managed care 
liability, or like California did, they can devise whatever law they 
want to. Under the bill, the bipartisan managed care consensus bill, we 
do not tell them how to do it in California or how to do it in Texas. 
For all I know, a State could pass a law that would say, we do not 
think that any employer ought to be liable for anything. And under our 
bill, that is the way it would be handled in that State, because I 
believe philosophically that this is where the decision should be made, 
in the States. I am willing to walk the talk.
  I wonder if the gentleman from Texas (Mr. Green) would like to 
interject a comment.
  Mr. GREEN of Texas. I thank my colleague, one, for being willing to 
do this night after night, and I know how firm he is in his belief, 
because I have watched the gentleman in our committee, in the 
Subcommittee on Health in the Committee on Commerce.
  The fear I have from some of the options tomorrow, some of the poison 
pill amendments, as we call them, is that transfer to Federal court, in 
my experience as a lawyer, again, practicing law, I did not want to go 
to Federal court. I had one case in my almost 20 years of practicing 
law that was in Federal court, but I liked the State court one because 
you could get to court quicker, you had more access, more judges in the 
court.
  Again, the Federal courts under our rules now, and we voted for them, 
they would give preference to criminal cases. I want that to still be 
the case. I want them to be able to handle the drug cases in the 
Southern District of Texas, because that is the overwhelming number we 
get in our Federal courts. I do not want to continue to add more cases 
to the Federal court when they cannot deal with the criminal cases now.
  So that is what worries me about allowing these to be brought in 
Federal court. It will just delay it. They will have to be behind the 
criminal cases. Why should we not take advantage of the State courts, 
because these are State issues? Typically, insurance has been a State-
regulated commodity, except on ERISA, but we have a right as a Member 
of Congress and as a Congress to say, on these issues, go back to your 
State court. I think that is good.
  The gentleman used the great example of his father, who managed 
produce. If somebody had slipped on that grape, they were going to 
State court. Whether it is Wal-Mart or Safeway or anyone else, why 
should they not be able to go to State court, just like they would if 
there is a personal injury?
  Mr. GANSKE. Reclaiming my time, Mr. Speaker, I think the gentleman 
would agree, if a Wal-Mart came to Congress and said, we think that we 
ought to take slip and fall injury out of State court and make it a 
Federal law, a Federal tort, does the gentleman not think they would be 
laughed off Capitol Hill?
  Mr. GREEN of Texas. I would hope so. Again, I thank the gentleman for 
yielding to me. There are certain cases the Federal court needs to be 
dealing with.
  We have not created Federal courts on the floor of this House. The 
Senate has trouble even filling the vacancies. But there are so many 
more opportunities for justice to be had in the local and State courts.

  Like I said, in Harris County, Texas, Houston, Texas, we have dozens 
more State judges than we do Federal judges. And again, we have State 
courts for civil jurisdiction, and we have the district courts, 
depending on the size of the loss. We could go to a county court if it 
is a small loss, whereas on the Federal level, you are in there, 
whether it is your small case, you are in there with those multi-
million dollar cases, but also you are behind the criminal cases.
  Again, our experience in the Southern District of Texas with the 
border region we have that comes up to Houston, most of the cases in 
our Federal District Courts are drug cases and criminal cases. They do 
not try as many civil cases as they used to. All these issues would be 
behind those criminal cases, because I want them to do those criminal 
cases. We want that justice swift for someone who is accused of 
violating our law, so they can either be found not guilty, or start 
serving their time.
  Mr. GANSKE. Let us be specific about this. The two bills that are 
going to come before us that would move an entire area of State law 
into the Federal courts are the Coburn-Thomas substitute and the 
Houghton substitute.
  What are some practical implications for that? The gentleman has 
already alluded to some of them. Let me speak from Iowa's perspective. 
I represent central and southwest Iowa. In Iowa we have 99 counties. 
There is a State courthouse. There is a county courthouse in every one 
of those counties, and a State court, but there are only two Federal 
courts in Iowa, one in Des Moines and one in Cedar Rapids.
  In Texas, I know there are 372 State courts, but there are only 39 
Federal courts. Texas is a bigger State than Iowa. How about in 
Oklahoma? There are 77 State courts, but one Federal court.
  What does that mean? That means that if we look at being able to get 
our say in court, and we have to go to Federal court in Iowa, someone 
may be traveling 200 miles to get into Des Moines, instead of going to 
the county seat. In Texas, I imagine, out in the panhandle, it could be 
significantly longer distances. Then you have the travel expenses, and 
as you mentioned, under a law that passed Congress about 25 years ago, 
the Federal judiciary is bound to handle criminal cases first before 
they can handle these.

                              {time}  2200

  And Chief Justice Rehnquist has told us that the Federal court system 
in the last 2 years has had a 22 percent increase in their caseload. 
They do not want this jurisdiction. They are understaffed now. If we 
look at current Federal judicial vacancies, there are currently 65 
judicial vacancies. Twenty-two Federal jurisdictions, because of the 
case overload, are called emergency jurisdictions. We anticipate that 
there will be another 16 vacancies in the next 6 months.
  That adds up to an understaffed Federal system, long distances, and 
for what purpose? The State courts are doing their job. I can hardly 
believe that some of my Republican colleagues would be in favor of 
expanding the big Federal Government in this area at the expense of 
their States.
  And we have talked about the fact that criminal case filings in 
Federal court are up 15 percent in 1998 alone. That is because Congress 
has passed some laws related to increased criminal penalties. We have 
talked about the

[[Page H9402]]

 fact that those criminal cases have priority in the Federal cases. So 
what does this mean? It means that consumers are not going to get a 
speedy resolution of their problem with an HMO if they have to go to 
Federal court.
  Now, some people, i.e. some of the HMOs, they would love it if they 
could delay 5 or 6 or 7 years. They would especially love it if we do 
not change ERISA because maybe the patient is dead by then and at that 
point in time under the ERISA law they would be liable for nothing.
  In Chief Justice Rehnquist's 1999 proposed long-range plan for the 
Federal courts he said, ``Congress should commit itself to conserving 
the Federal courts as a distinctive judicial forum of limited 
jurisdiction in our system of Federalism. Civil and criminal 
jurisdiction should be assigned to the Federal courts only to further 
clearly define a justified national interest, leaving to the State 
courts the responsibility for adjudicating other matters.''
  And I have here a letter from the National Association of Attorneys 
General that says, ``Any Federal legislation enacted should at a 
minimum provide full authority for states to enforce all legal 
standards independently of Federal entities.''
  I have here a letter from the National Conference of Chief Justices 
relating to this Federal-State issue. They say relating to court 
jurisdiction, ``Following the exhaustion of administrative remedies and 
consistent with the general principles of Federalism, State courts 
should be designated as the primary forum for the consideration of 
benefit claims.''
  I think that quite frankly if the national governors are aware that 
we are about ready to take away State jurisdiction in something like 
this, they are going to come out pretty darn strongly against a piece 
of legislation that usurps State authority.
  Now, let me move on to something that the gentleman from Missouri 
talked about in terms of how our bill, the bipartisan managed care 
bill, the Norwood-Dingell bill either does or does not protect 
employers, because this is a crucial point. I would say that it does 
protect employers. As a physician who ran a medical office, and who has 
a lot of friends who run medical offices, employing a lot of people 
providing health insurance for them, I would not be in favor of a bill 
that would say that they would now be liable for a decision by their 
HMO that they have contracted with for their employees that would put 
them at risk. The bill that we have does not.
  We simply say this: that if one hires an HMO as a business and that 
HMO makes a decision that results in an injury to the patient and you 
as an employer have not entered into that decision, then you are not 
liable. Period.
  I have here an assessment by one of the leading law firms in the 
country that deals with the Employee Retirement Income Security Act, 
the ERISA law. They analyzed the language in our bill that is designed 
to protect employers. They specifically addressed the claims by those 
opponents to our legislation. They say that those claims that our bill 
does not protect employers do not represent an accurate analysis of the 
employer protections in the bipartisan bill. The claims that the bill 
would subject plan sponsors or employers to a flood of lawsuits in 
State courts over all benefit decisions and suggests that plan 
sponsors, i.e. employers, would be forced to abandon their plans is 
incorrect for the following reasons:
  Number one, most lawsuits would not be against employers. Under 
current ERISA preemption, lawsuits seeking State law remedies for 
injury or wrongful death of group health plan participants are already 
allowed in numerous jurisdictions; and those cases show that those 
suits are normally brought against HMOs, not against employers.
  Mr. DREIER. Mr. Speaker, if the gentleman from Iowa will yield, I 
would simply like to congratulate my friend and tell him that I have 
just filed a rule, which in fact, will allow us to have the freest, 
fairest debate that we have had in over a quarter century on the health 
care issues.
  We anxiously look forward to bringing that measure up tomorrow 
morning here on the House floor, and we will continue to debate it into 
Thursday. And I thank the gentleman for yielding, and I look forward to 
his continued remarks.
  Mr. GANSKE. Mr. Speaker, I thank the gentleman from California (Mr. 
Dreier), chairman of the Committee on Rules for his comments.
  Mr. Speaker, let me continue on talking about this analysis that was 
done by a leading law firm on how the bill that I support, the Norwood-
Dingell bill, bipartisan consensus managed care reform act actually 
does protect employers. And there are about four or five points that 
this legal brief makes.
  First is that lawsuits would not be against plan sponsors. Second is 
that plan sponsor is limited. Third is that the statute's plain meaning 
limits employer liability. And the fourth is that they point out 
several reasons why the private sector health care would not be 
destroyed.
  This is what is in our liability provision. It basically says that if 
there is a problem, it goes back to State jurisdiction. But we do not 
want to increase the number of lawsuits. We want people to get the care 
that they need before they lose their hands or lose their feet like the 
little boy who I showed. So what we do is we say that an HMO should 
have an internal appeals process in a timely fashion, but that if the 
patient or family is not still happy with a denial of care at the end 
of the internal appeals, they go to an external appeal by an 
independent peer panel of doctors that can make a binding decision on 
the health plan and does not need to follow the plan guidelines.
  In other words, they can consider those plan guidelines on medical 
necessity, but they can take into consideration the medical literature, 
prevailing standards of care, NIH consensus statements. In other words, 
the things that are necessary in order to make a determination.
  We say they cannot overrule a specific exclusion of coverage. And so 
let me just say there is nothing in this legislation that prevents an 
employer who has business in many different States from being able to 
design a standard benefits package. There is nothing in this bill that 
says that they now have to follow State mandates as it regards to 
benefits.
  All we are saying is that if they are up front and say they do not 
cover bone marrow transplants, then that independent panel, even if the 
patient needs it, cannot tell the health plan that they have to give 
it. But if they do not have a specific exclusion and that patient needs 
it, then the independent panel can tell the plan they have to provide 
it; and if the plan follows the recommendation, then we have a fair 
compromise.
  The Democratic side of the aisle made a big compromise on this. It is 
that if the health plan follows that recommendation by the independent 
panel, then there can be no punitive damages against that employer; and 
that would be a punitive damages relief not just for group health plans 
but also for all other health plans. Individuals as well. Not just for 
ERISA plans but for non-ERISA plans. That is a major compromise, but it 
is a fair one because if the plan follows the recommendation of the 
independent panel that has made the decision, then they cannot be 
maliciously liable for someone else's decision.
  But we need to have the liability provision in there as the ultimate 
inducer to the HMO to follow the law. Why is that? Let me give an 
example from Texas. Texas just passed this HMO reform bill that 
includes liability for health plans. In that bill they say that if a 
physician recommends treatment to a patient, say a patient is in the 
hospital but the HMO says no, we do not want to pay for it but the 
physician says, hey, this patient could suffer injury, then under the 
law that dispute is supposed to go immediately to a peer review 
organization for a determination. It is supposed to be sent there, the 
determination is supposed to be sent there by the plan.
  Well, about a year or so ago after this law was passed in Texas, a 
psychiatrist who was taking care of a man who was suicidal. He was in 
the hospital. The psychiatrist thought that this man could commit 
suicide and so he told the health plan this patient needs to stay in 
the hospital. The health plan said no we are not going to pay for it 
any more. Send him home, and told the family that. Now, under Texas law 
they were required in that situation to get an independent peer

[[Page H9403]]

review decision, but they did not. They did not follow the law. They 
just told the patient to leave. So the patient went home that night. He 
drank half a gallon of antifreeze and he died. It took him 2 days of a 
horrible, painful death.
  Now, in that circumstance under Texas law, that health plan is now 
liable. They did not follow the law. If we did not have liability, why 
would any plan ever follow the law? It will take about two or three 
cases like that and then the health plans in Texas will decide, we had 
better follow the law before a patient goes home and commits suicide.
  That is part of the reason why we need enforcement. But I honestly 
think that if we combine the appeals process, if we combine the 
provisions in our bill related to emergency care, related to clinical 
trials, related to physicians being able to tell their patients all of 
their treatment options, and we follow an internal and external appeals 
process, that we are actually going to decrease the incidence of 
injuries, and we are going to decrease the number of lawsuits.

                              {time}  2215

  That in fact has been what Texas has found out.
  Before they passed the Texas law, the HMOs, the business groups, they 
lobbied furiously against that law. They said the sky will fall, the 
sky will fall. There will be an avalanche of lawsuits. Premiums will go 
out of sight. The HMOs will all leave Texas.
  What has happened? There has just been a couple lawsuits like the one 
I mentioned where the plans did not follow the law. Premiums have not 
gone up any faster in Texas than they have anywhere else. In fact, they 
still have lower than average premiums. There were 30 HMOs in Texas 
before this law passed. There are 51 HMOs in Texas today. The sky did 
not fall.
  There have been over 600 decisions made to resolve disputes because 
of that Texas law, and more than half of them have been decided in 
favor of the health plans; and that has provided an adequate relief to 
the patients to know that they are getting the right care. But half of 
the time the independent panels have decided for the patient, and so 
they have gotten the treatment before an injury has occurred.
  This is just common sense. All our bill does in terms of ERISA is say 
that, let the State jurisdiction as it relates to liability function. 
In Texas, one has to follow these rules and regulations. There are 
protections for employers. That is the law as it relates to liability.
  California just passed an HMO liability bill. That would be the way 
that it would be handled in California. This is federalism. This is 
returning power to States. This is following up on Republican 
principles where the States are the crucible of democracy. This is 
following the Constitution. This is following the remarks of the 
Supreme Court Justice who says, please, do not load up the Federal 
judiciary any more than what would be absolutely necessary for national 
security. Do not take away jurisdiction from the States if they are 
doing a reasonable and good job; and they are in this area.
  So I just have to ask my Republican friends, it seems to me that if 
they are for States rights, if they are for responsibility, then they 
would be against a bill that would remove this authority from the 
States. They would be against the Coburn-Thomas bill. They would be 
against the Houghton substitute. They would be for the Norwood-Dingell 
bill. Those are Republican principles, and they will be done at a very 
modest cost.
  As I said before, we are looking at, for an average family of four, 
potentially an increase in the cost of premiums of about $36 a year. 
That is money that my constituents tell me is well worth it if it can 
reassure them that they are going to be treated fairly by their HMO.
  So when we have our debate in the next day or so on this, let us try 
to get past some of the special interest smoke and mirrors and Chicken 
Little statements. Let us do something right. Let us do something for 
justice. Let us correct a problem that Congress created 25 years ago. 
Let us be for our principles of States rights and responsibility, and 
not tilting the deck against a fair market.
  Let us be for the Norwood-Dingell Bipartisan Managed Care Reform Act. 
Vote, I would say to my colleagues, however my colleagues want on the 
access bill. My colleagues are going to have to balance some of those 
individual provisions. If it passes, it will go to conference. But I 
would urge my colleagues strongly to vote against the Coburn-Thomas 
bill and against another substitute that would be against our 
Republican principles of States rights and individual responsibility.

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