[Congressional Record (Bound Edition), Volume 146 (2000), Part 17]
[House]
[Pages 25455-25461]
[From the U.S. Government Publishing Office, www.gpo.gov]



                         HEALTH CARE IN AMERICA

  The SPEAKER pro tempore (Mr. Simpson). Under the Speaker's announced 
policy of January 6, 1999, the gentleman from Oklahoma (Mr. Coburn) is 
recognized for one half of the time remaining before midnight as the 
designee of the majority leader.
  Mr. COBURN. Mr. Speaker, I rise tonight with the gentleman from 
Arizona (Mr. Shadegg) to talk about health care in America. It is 
Sunday night. We are in Washington. The politics, rather than people, 
are front and center stage within the House and the White House and the 
Senate.
  A lot has happened in the last 6 years since I have been in Congress, 
but nothing has happened to fix the real problems. I want to spend just 
a little bit of time creating a set of circumstances that the American 
public might hear tonight about where we find ourselves.
  If Americans are in an HMO today or in an insurance plan that is a 
PPO, a Medicaid HMO or if they happen to be fortunate enough to have 
pure fee-for-service medicine, the one thing that they know is that 
over the last 10 or 15 years they have lost a tremendous amount of 
their freedom. They have no ability to choose the physician or the 
health care provider that is going to care for them. That very personal 
aspect of their life, they no longer have a choice.
  If Americans are in Medicare, they cannot go outside of Medicare to a 
physician who would not take Medicare. They have no right to do that 
under the laws of Medicare. A doctor in this

[[Page 25456]]

country today, if, in fact, they do not take Medicare and then treat a 
patient who is in Medicare, will be fined for treating that patient 
because they are not a contractor to Medicare, even though the patient 
might want to pay that money themselves.
  The point I am making is that all of us, the vast majority of us, 
have lost a significant amount of freedom when it comes to making 
decisions about our own health care. That has been displaced by one or 
two or three other organizations. The first place it has been displaced 
is by the Federal Government. The second it has been displaced by the 
payer, it is actually a part of wages, that benefit, that health care, 
who is making that decision for the employee. They decide what group of 
doctors they can go to.
  If Americans have Medicaid and are in a Medicaid HMO, they do not 
have the choice of going to the doctor that they want to. They will go 
to the doctors they are told to go to.
  Mr. Speaker, we have lost a tremendous amount of freedom. We have 
heard a lot of discussion in the campaign rhetoric about a patients' 
bill of rights. I want to say that if we really had our freedom back, a 
patients' bill of rights would not be necessary. And the way to get our 
freedom back is to allow each of us to have that benefit, and we decide 
personally what we do about our own health care. That is a huge step in 
the opposite direction the country is going.
  The second thing I want to talk about is what we have been hearing in 
the political rhetoric of the campaign about prescription drugs. Every 
politician in the country has an answer on prescription drugs, except 
the right answer. The problem with prescription drugs in this country 
is they are too expensive. And the reason they are too expensive is 
because there is no longer competition within the pharmaceutical 
industry. There is no longer a true competitive industry in the 
pharmaceutical industry.
  How do I know that? Because we have seen the studies. We have seen 
the collusion. We have seen the fines, hundreds of millions of dollars 
of fines being charged to pharmaceutical companies. A letter was sent 
over a month ago to the Attorney General of the United States asking 
her to look aggressively at competition in the pharmaceutical industry. 
She has yet to answer that letter that was sent by myself early this 
summer.
  The fact is we know in America, in our competitive society, that the 
best way to allocate resources, to keep prices the lowest they can be, 
is to make sure we have competition. What is the politician's answer? 
Let us create a Government program. Let us create more Government 
control, rather than less.
  Mr. Speaker, what we need to do in the pharmaceutical industry is to 
enhance and enforce the laws that we have today; and we will see 
pharmaceutical prices go down. The American public is subsidizing 
prescription drugs for the rest of the world. It is time that stopped. 
A Government program will not stop that. A Government Medicare program 
for prescription drugs will not stop that. All that will do is lower 
somewhat the prices for seniors and raise them for everyone else.
  So if we continue to fix the wrong problems in our country, what we 
are going to have is a worse health care system, not a better one. Some 
people would like to see that because they believe the Government ought 
to be in control of all of it. I do not happen to be one that feels 
that way.
  This House passed a bill this past year called the patients' bill of 
rights. It is extremely flawed in its ability to help patients and to 
put doctors back in charge, with their patients, of the care. It is a 
step in the wrong direction. We should not be doing a patients' bill of 
rights. What we should be doing is a patients' bill of fairness so that 
we own our health care, we make decisions about our own health care, 
and we are responsible for our own health care.
  Those benefits that now come to us through an employer should come to 
us directly, allowing us to choose. As a Medicare patient, allowing 
them to choose. As a Medicaid patient, allowing them to choose. The 
only people who really have freedom of their health care, and they do 
not have much health care because they do not have insurance, but 
nobody is telling them who they can and cannot go to.
  Mr. Speaker, our country was founded on liberty. We have lost 
tremendous liberty when it comes to health care in our country. A 
Government fix is not the answer. The answer is to reinstitute what we 
know works: Rigorous competition to allocate scarce resources.
  Mr. Speaker, I yield to the gentleman from Arizona (Mr. Shadegg).
  Mr. SHADEGG. Mr. Speaker, I will start here and then come down there 
and use some of those charts. I would like to pick up on some of the 
remarks that the gentleman has made. Most importantly, the key factor 
here is choice.
  In the gentleman's remarks, he pointed out that most of us, at least 
most of us in the workforce, those who have a job, if we are lucky 
enough to have health care at this point in time, if we have health 
care coverage, we likely get that health care coverage through our 
employer. That is good, because it means we have health care coverage; 
and that is an advantage.
  But there are some tragedies involved in that structure. First of all 
it means that thousands of Americans, tens of thousands of Americans, 
indeed 44 million Americans who are uninsured, they do not get the 
chance to get their insurance through their employer, so many of them 
do not have any insurance at all. That is not right, and we need to 
deal with the problem of the uninsured.
  I think the right way to deal with it is to give them a refundable 
tax credit and let them go buy an insurance policy that is theirs, that 
is a portable insurance policy that belongs to them and lets them go 
buy the health care plan they want.
  But the other problem with the other half of this structure is those 
people that get their insurance from their employer. The problem with 
that structure is we lose all choice. If we work for any employer in 
America large enough to buy health care insurance, we are offered 
either one choice or a fairly small list of choices, unless we work for 
a very, very large employer.
  I like to talk about Joe Jordan's Mexican food restaurant, which is 
where my wife, Shirley, and I went on our second date. Joe Jordan and 
his family did not go into the Mexican food business because they 
thought they were good at buying health insurance. They went into the 
Mexican food business because they were good at making and cooking 
Mexican food. And yet under our structure today, Joe Jordan has to 
select the health insurance for his employees and they get no choice.
  Mr. Speaker, we can change that. We could go back to a system where 
we gave individual people choice in health insurance and let them buy 
the health insurance that meets their needs. And the key to that would 
be if the plan they bought did not satisfy their needs, if they went 
out and bought an HMO because they thought it was the most cost-
effective type of care they wanted and that HMO did not service their 
needs or do a good job by them or their family, they could fire that 
HMO and go hire another one.
  The gentleman from Oklahoma said we would not need a patients' bill 
of rights if health care were a matter of choice, but it is not. We get 
it through our employers.
  Earlier this year, I introduced legislation to give people choice, to 
let them buy a health care plan of their own, or to let their employer 
give them essentially the right to go buy with his funds their own 
health care plan. With that kind of choice, we would, as the gentleman 
said, we would not need a patients' bill of rights. Because if their 
HMO did not treat them right, they would fire that HMO and they would 
go buy an HMO that serviced them well and did a good job by them. Just 
like they do with their auto insurance company or homeowners insurance 
company or any of the decisions they make in there lives.

                              {time}  2230

  But we are at the point where we are debating on the floor of this 
House, we

[[Page 25457]]

have all year and indeed last year as well, the issue of a so-called 
Patients' Bill of Rights. I think it is important to talk about the 
differences and the choices in that legislation and why the bill that 
passed this floor is so bad and indeed would do damage to health care 
in America. I would like to do that with the charts down there, so the 
gentleman and I will trade places.
  This chart right here kind of shows the fundamental question that 
faces America on the issues of health care for the working people of 
America who get a health care plan from their employer. It is a simple, 
straightforward question, ``Health care in America, who should make the 
decision?'' You get three choices: HMOs, lawyers, or doctors and 
patients.
  I think the answer to that question is very obvious. I think doctors, 
together with their patients, ought to make medical decisions in 
America. But it is important to understand how the system works today. 
The system works today to say doctors and patients do not get to make 
the choice. No. The system today provides that HMOs make medical 
decisions; indeed, HMO bureaucrats often make medical decisions.
  But somebody out there watching might say, well, why are lawyers on 
this chart? That does not make any sense. I thought it was a battle 
between HMOs on the one hand and doctors and patients on the other 
hand. Well, that is what one thinks it should be, but that is not what 
it is.
  Because some of the legislation that has gone through this House and 
the legislation that the President talks about, the legislation that is 
discussed by our Democrat colleagues, would not leave power in the 
hands of HMOs. Indeed, it would take power away from HMOs. But, sadly, 
it would not move that power over to patients and doctors. It would 
instead move that power to trial lawyers. And that will set health care 
back rather tragically.
  Since the gentleman is a doctor, perhaps he would like to comment on 
that.
  Mr. COBURN. Mr. Speaker, there is no question today that oftentimes, 
and even as I have been in Congress as I have continued to practice 
medicine, proper care has been denied patients in my practice by HMOs 
and insurance companies.
  It is not just HMOs, it is insurance companies, as well, that are 
making those decisions. And it is not necessarily medical personnel 
within those companies, but clerks, trained individuals who know how to 
read a check-off chart that decide who gets care and who does not.
  I want to go back to what I talked about first. The greatest freedom 
we have in this country is the right to choose, the right to choose 
what kind of practitioner we are going to go to, whether or not we are 
agreeable to and satisfied with the individual that we have chosen to 
do very, very personal things with us as we manage our health care and 
do preventive health care. And in fact too many in this country have 
lost that right.
  I do not believe the answer to it is to create another government 
bill. Although that may be a short-term solution, it fixes the wrong 
problem. The problem is not allowing people the tax credits, the 
deductibility and the options of making those choices themselves and, 
most importantly, also having a small financial responsibility 
associated with that.
  One of the things that we know in medicine today is there is 
tremendous over-utilization. And one of the reasons it is over-utilized 
is because there is no personal cost to utilize it. And when we see 
that, what we know is we do not allocate the resource properly. So as 
individuals become empowered and they also take on a small portion of 
that responsibility, their decisions about how they utilize that asset 
and that service will change. But, most importantly, bureaucrats should 
not be making the decision and certainly not lawyers.
  Mr. SHADEGG. Mr. Speaker, I certainly agree with the gentleman. It 
seems to me, if we can someday get to a system of choice where people 
can pick their own health care and fire it when it does not serve them 
well, whether it is an HMO or an insurance company, we will have 
advanced health care in America greatly.
  But the gentleman in his remarks made clear that he thought the 
legislation which had passed this House earlier and the legislation 
which is being talked about, indeed our Democrat colleagues held a 
press conference just the day before yesterday where they talked about 
the tragic death of a Patients' Bill of Rights and how that legislation 
was vitally important, and they are talking about it in all their press 
conferences; and the President is saying, well, this Congress failed 
the American people by not passing a Patients' Bill of Rights.
  The gentleman pointed out in his remarks, and I agree with him 
completely, that the Patients' Bill of Rights, which our colleagues on 
the other side of the aisle would like us to pass, is indeed fatally 
flawed. And there was a good reason not to pass that legislation and it 
is a reason that has never been discussed on the floor of this House, 
and I think it deserves to be discussed; and I think the American 
people need to know about it, and I think our colleagues need to know 
about it.
  I put up another chart here, and it raises the same question, who 
should decide how doctors care for patients? Right now, as this chart 
illustrates, the standard of care in America is currently set by HMOs 
and HMO bureaucrats when they tell doctors how to care for patients.
  How does that happen? Well, your doctor decides to recommend a 
certain level of care or treatment for you. He applies to the HMO for 
that and the HMO says no, largely and often through a bureaucrat. The 
HMO says, we do not think that is the proper care. We think something 
else is the proper care. Well, that is a structure under which the HMO 
tells doctors how to care for patients.
  But let us talk about the bill that passed the floor here, the so-
called Norwood-Dingell bill. What does that bill do? Does that bill 
empower doctors to set the standard of care and to decide how patients 
should be cared for, or does it not? The sad truth is it does not do 
that.
  The Norwood-Dingell bill would, instead of allowing doctors to decide 
the level of care, the standard of care, what treatment a patient 
should be given, it says that lawyers should make that decision. That 
is a tragic decision. And it does that by saying that anytime a lawyer 
wants to, that lawyer can simply go out and file a lawsuit. He or she 
does not have to wait until the case has been reviewed by an 
independent panel of doctors to decide if the care should have been 
given by the HMO or, perhaps, if the HMO made the right decision. 
Instead, we skip that process and let the lawyer go straight to court, 
which means that the standard of care in America will not be decided by 
doctors, it will not be decided by doctors consulting with their 
patients, it will not even be decided by doctors consulting with an 
HMO. It will be decided by doctors filing lawsuits and going straight 
to court.
  We believe, I believe strongly, where we ought to be is that the 
standard of care should be decided as a result of a review of a request 
for care by an independent external panel of doctors.
  I am sure the gentleman has personal experiences with HMOs denying 
care that he requested for his patients.
  Mr. COBURN. I do. I think, in fairness of the debate, I want to make 
sure that people are aware that, when that bill passed the House, I did 
indeed cast a vote for it. And there was a very good reason that I cast 
a vote for it. I thought we ought to move the process along to try to 
solve some of the problems. And it is very apparent to me that what I 
would like to see and I believe the gentleman from Arizona (Mr. 
Shadegg) would like to see in terms of deductibility and people truly 
having choices across this country is not going to happen this year.
  So then the question becomes should we do something in the meantime 
until we can put power of choice back into the hands of every American 
who needs health care.
  I can relate an experience that to me that I think just shows the 
problems

[[Page 25458]]

associated with managed care in this country, and it is denial of care 
that is recommended by a doctor when in fact, and this is a real 
incident and I will not go into the details of the case or the 
individual's name out of medical confidentiality, but needless to say, 
I had a patient who needed a diagnosis that was turned down. As it 
ended up, I ignored them and went on and did it anyway. And it was a 
cancer and it was identified. And then they were all too happy to pay 
for the procedures that they had been denied prior to that.
  So how do we solve that? If you do not have an aggressive doctor that 
is going to buck the HMO and you have no external appeals panel, then 
the only way to solve that is to go to court. Well, that is not a good 
way to solve it because what happens is patients do not get treated. 
That is why the standard of care ought to be the professionally 
accepted standard of care across this country. That can best be decided 
not by an HMO bureaucrat and not by a doctor working for an HMO or 
managed care plan, because they quite frankly have a bias and that is 
for their employer, as it should be, but by three independent doctors. 
And every denial that is felt qualified by a doctor ought to have that 
chance to be reviewed by their peers to see if in fact that is the 
standard of care.
  There is a couple things that come out of that. Number one, where we 
know this is working, which is in Texas now, is that 45 percent of the 
time the doctors on the panel say the doctor is wrong. What happens 
then? It improves the quality of care because it raises the level of 
knowledge of the doctor that was asking for something.
  The 55 percent of the time when the plan is reversed, the patient 
gets the care that they need and the plan learns. So any system that is 
designed ought to be designed so that it advances care and lowers cost, 
not increases them. Delay in diagnosis, delay in treatment is the 
number one cause of medical malpractice suits in this country today. 
And I would tell you that the managed care industry is tantamount to 
being a large portion of that because of the restrictions.
  As my colleague has said, and I agree, we must have an exhaustion 
before we go to lawsuits before we are going to care for patients.
  Mr. SHADEGG. We have put up a graph here that we developed to try to 
graphically illustrate this point. All of the legislation that has been 
here on the floor of the Congress and over in the Senate talks about a 
process, and the process is what should we do when a patient and his or 
her doctor make a request of the managed care organization or the HMO 
for care? How do we deal with that request? How does he process that 
request so that you get that request processed and get the right 
result?
  I think the right result is the best possible care at the earliest 
possible moment. And it is true, doctors sometimes seek care that is 
not necessary. They seek care that the patient does not really need 
because they are being pressured by the patient. Indeed, someone argue 
some doctors seek care just to make the money from delivering that 
care. And I think we talked about that kind of abuse of the system. And 
managed care has done a good job of putting that in check.
  I think another abuse that occurs is that doctors sometimes are not 
on top of the current standard of care. They do not know what is the 
best treatment for a particular condition because they have not read 
the literature and managed care again has stepped in and said, no, we 
are going to require you to do what is best.
  But the real problem in this area is that the current structure where 
an HMO gets to decline a doctor who is asking for care and say, well, 
no, that care is not medically necessary and appropriate, the real 
demand for a Patients' Bill of Rights arises out of the potential for 
abuse, so that the managed care plan turns down the patient and his or 
her doctor requesting care on the basis that it is really not medically 
necessary and appropriate.
  That vague term creates a loophole through which managed care 
companies can deny needed medical care for reasons that are not really 
medical but, rather, are financial, that is, to make the HMO's profit 
line or bottom line better.
  How do we solve that? How do you correct that? Well, all of the 
legislation that has gone through here, the so-called Patients' Bill of 
Rights legislation, looking at this potential for abuse, an HMO 
declining care and saying it is not medically necessary and 
appropriate, when they are really not doing that for a good medical 
reason, they are doing that to save money, they are doing that to 
improve the HMO's bottom line.
  All of this legislation has talked about is structure. There should 
be a doctor and their patient. They make an initial claim. Having made 
an initial claim and assuming it is turned down, they then go to 
internal review. The internal review is the HMO itself taking a look at 
that claim, hopefully this time through medical personnel, doctors, and 
saying, yes, the care is needed, go ahead and deliver it, or, no, it is 
not.
  Now, everything is good up to that point. But the question is what 
happens if at that internal review by the HMO's own in-house doctors 
they say the care is not needed? Well, how do you determine if that was 
the right decision and the care really was not needed for medical 
reasons and some other care would be appropriate, or the care is not 
needed at all, or did they make that decision for the wrong reason? Did 
they decline the care just because they want to make a profit and they 
do not want to deliver the expensive care that is being asked for?
  The legislation that I believe, and the gentleman just talked about 
this, the legislation that we feel is the important model here, and the 
flaw in the Norwood-Dingell bill occurs right here, what we believe has 
to happen at that point is that, when the HMO and its own doctors turn 
you down for the care and tell your doctor, no, you cannot have the 
care, we believe it is vitally important that the next step that you as 
a patient have a right to go to and you and your doctor have the right 
to go to is an external review panel, right here, an external review 
panel made up of three doctors who are completely independent of the 
plan and completely independent of you and your doctor. They are 
totally independent, and they have the ability and the expertise to 
review the claim.
  They are essentially three independent medical arbiters who review 
your case, review what your treating physician said was needed, and 
review what the plan said and the plan's reasons for denying the care. 
Our goal is that that panel of three independent experts would say, you 
know what, this care is medically necessary and appropriate. Plan, you 
should deliver it. And it should be binding on the plan that they must 
deliver it at that point in time. That lets three independent doctors 
not controlled by the plan, not controlled by you and your doctor, get 
you the right decision at the earliest possible moment.

                              {time}  2245

  That is a timely decision. That is a fast decision by that external 
review panel. If, in fact, they say the care is needed, then the HMO is 
bound by the panel's decision; and if you have been injured, you 
recover monetary damages. But the flaw in this system, the flaw that is 
in the other idea, is they do not want to require cases to go through 
this external review and that is illustrated right here on this chart 
of the Dingell-Norwood bill. This is a schematic, just like the other 
one, of the Dingell-Norwood bill. There is an initial claim just like 
is the case under the legislation we have advanced. Then there is 
internal review, and that is the next step and the plan's doctors get 
to review your case. Remember those are the plan's doctors. They are 
the ones with the incentive to deny care. That is the place where the 
abuse can occur.
  Here is the key difference and here is why that patients' bill of 
rights, that our colleagues on the other side of the aisle want, what 
the President wants, is a tragically flawed proposal that will not help 
patients and will not help doctors. Right here at internal review 
instead of requiring that case to go

[[Page 25459]]

quickly to external review, to a panel of three doctors who would say 
you get the care or you do not get the care, and you can recover 
damages if you have been injured, they create a loophole and it is the 
lawyer's loophole, and that loophole is all you have to do is to decide 
to talk to a lawyer and that lawyer gets to say, you know what, I do 
not want an external review because that external review by three 
independent doctors might turn my client down and if in an external 
review my client is turned down, my lawsuit is gone; my monetary 
damages are gone; that will destroy everything I want. So what have 
they done? They have written into the Norwood-Dingell bill that a 
lawyer simply steps in right here, the lawyer simply alleges injury, 
hey, my client has been injured, I think he has been injured and I am 
ready to go to court.
  And at that point, the external review by doctors, the three 
independent doctors who are going to review that case, the three 
independent doctors who were going to set the standard of care and tell 
the HMO how they should be treating patients, that external review of 
doctors is gone. Instead, you know where that case is? That case is not 
quickly decided by an independent panel of three doctors. That case is 
moved into our courts, and everybody knows that courts and lawsuits 
take forever. It will take who knows how long to drive this case 
through that court and who knows how frivolous the case will be, but 
the lawyer now has a chance to extort monetary damages to try to make 
the case settle even if it is meritless.
  What happens to the poor patient? The poor patient waits, but the 
trial lawyer does well. That is the fatal flaw in the Norwood-Dingell 
legislation that has been put here on the floor, that the gentleman 
from Oklahoma (Mr. Coburn) talked about. You just have to ask yourself 
if you want to empower patients and doctors, then should you not give 
that ability to an external review panel? On the other hand, why should 
you let lawyers decide which cases go to external appeals or which 
cases go straight to court? That is the flaw that the gentleman from 
Oklahoma (Mr. Coburn) was talking about in the Norwood-Dingell bill. It 
is a bill that is designed to get patients into courtrooms, not to get 
them care.
  I think care has been a key component of what you have talked about 
in this important debate, and it is what the gentleman says, I think 
that the Norwood-Dingell bill is flawed because it will not get people 
care. It will get them a lawsuit.
  Mr. COBURN. Mr. Speaker, I thank the gentleman for his comments. I 
want to go back to really what we opened with, because so much 
partisanship has gone on and so much of the politics that the American 
people are seeing today throughout have to do with the patients' bill 
of rights. As I understand the medical system industry profession and 
patients today, and by the way I just remind my colleague, as he knows, 
that I have continued my practice, since I have been in medicine, 
delivered over 400 children since I have been here in this past 6 years 
and have continued to engage the managed care industry when I have been 
at home, we should not be having this debate. If Americans truly had 
the freedom that they once had, we would not be having a debate. We 
would not be about fixing the wrong problem.
  Mr. SHADEGG. Does the gentleman mean we will not be debating this 
complicated flow chart that they want to create as a matter of Federal 
law that is going to try to arbitrarily decide from Washington how to 
process these claims and kind of have a win or lose battle between 
doctors and insurance companies on the one hand and trial lawyers on 
the other hand? We would give that power to patients and let them 
choose?
  Mr. COBURN. Well, if we think about it today, that if you are in a 
fee-for-service plan that you are paying for yourself, you have all of 
those rights. If you have no insurance, you have all of those rights 
today. The people that do not have those rights are in the programs 
that have been designed by the Federal Government and have been 
designed by the large corporations to try to control the costs. And 
there is no incentive for the individual consumer, who is a part of 
those systems, to help control the costs. So if in fact we move to a 
point where we had some personal responsibility and accountability and 
our health care was in our hands instead of some third party, whether 
it be the Federal Government or our corporation that we work for, which 
is a great benefit but, in fact, in today's time that is one of the 
things that is part of our remuneration is our health care.
  The other thing I would say is that most Federal employees have those 
rights, too. They get fee-for-service. We give Federal employees a 
wonderful choice of options, and they can go fee-for-service and they 
have every right there that they have. How is it that Federal 
employees, except military and retired military, how come people who 
are in fee-for-service that are paying for their own have those rights 
but the rest of us who are dependent on a program no longer have that 
freedom? That is a basic question that Americans ought to be asking 
themselves any time they hear any politician during this election cycle 
talking about a patients' bill of rights. They are talking about the 
wrong problem.
  Mr. SHADEGG. They are talking about a bureaucratic Government program 
that tries to mandate something from Washington, D.C., and I could not 
agree more with the gentleman. As the gentleman knows, I have 
introduced legislation that would let people choose their own health 
care.
  Indeed, the legislation we introduced would say to an employee, 
whether they worked for Joe Jordan's Mexican Food, the one I talked 
about, the Mexican food restaurant in Phoenix, Arizona, or whether they 
worked for a large employer, Caterpillar Tractor, General Motors, 
whoever it was, would let that individual employee exercise choice so 
that they could hire or fire their health insurance plan based on their 
own decision, not their employer's decision.
  I think, in discussing this issue, it is important to note that the 
current Federal Tax Code allows employers to give employees health 
insurance, and they are not taxed on that benefit. That is the reason 
that most people get their health care from their employer. If their 
employer gives them an extra thousand dollars, they pay taxes on that 
thousand dollars and they give somewhere around a third of it to 50 
percent of it to the Federal or the State or the local government in 
income taxes. On the other hand, if their employer simply hands them a 
health care benefit worth a thousand dollars, they get that full 
thousand dollars in value.
  The plan we are talking about, giving people choice to go buy the 
plan they want, actually is allowed under the current Tax Code. Under 
the current Tax Code, your employer can say to you, I am going to give 
you the $1,000 dollars or the $500 or the $1,500 or the $2,000 that I 
spend on your health care and as long as you go spend that on health 
care and confirm that fact back to your employer, it is not income to 
you and it is still a deduction to your employer. So we can move to a 
choice system. We can give people freedom if American employers will 
simply do it.
  Mr. COBURN. It is really interesting. The tax bill that the President 
is saying that he is going to veto also adds, for those people who work 
for an employer who does not provide it, above-the-line deduction for 
their health care benefit. So what we actually are doing with the tax 
bill that is going to the President is, if you work for an employer 
that does not provide health care, we are giving you the same benefit 
we are going to give that employer. You are going to be able to deduct 
that above the line of your adjusted gross income so that you do not 
pay taxes on that income, and it becomes a straight deduction. That is 
another way of giving you freedom.
  Mr. SHADEGG. We have talked about the flaw in the Norwood-Dingell 
bill which would allow a trial lawyer to step in, circumvent external 
review, take the power to set the standard of care away from doctors 
and take that decision to a courtroom, and why we

[[Page 25460]]

think that is a bad idea here. Maybe we ought to talk about some of the 
other trade-offs that are going on here.
  It is absolutely true that there are about 13 individual patient 
protections in the legislation, and I support those patient 
protections. They include things like the right of a woman to have an 
OBGYN as her primary care physician; the right of patients like my 
wife, Shirley, and I to have a pediatrician as our child's primary care 
physician; the right of all of us to go to an emergency room even if it 
is not an emergency room signed up with our HMO and get care. And each 
of those are important rights, but only important rights as long as we 
are trapped in a system where we cannot fire our HMO and hire one we 
want.
  The reality be known, we would not need, as the gentleman has said, a 
patients' bill of rights. We would not need this complicated flow 
chart. We would not need to bring trial lawyers into the whole 
discussion. We would not need to be talking about cutting out the 
ability of doctors to set the standard of care if, as a matter of 
right, we could go as individuals, as employees of a company, and say, 
you know what, I do not want the HMO you picked for me. I want to go 
buy a plan that I can hire, a plan that I can fire, a plan that has 
already in it, and I get to pick it and I get to sign up for it, the 
right of my wife to see an OBGYN of her own choice; the right of she 
and I to pick a pediatrician as a primary care physician for our 
children; our right to go to an emergency room of our choice. If we had 
that kind of freedom, then we clearly would not need not only the 
liability scheme in this flawed Dingell-Norwood legislation, we would 
not need the patient protections.
  Sadly, that is not where we are. We are debating yet one more massive 
government scheme to try to regulate the marketplace.
  Mr. COBURN. I want to thank the gentleman for sharing this time with 
me. I look at the American health care system today. Prior to being a 
physician, I managed a fairly large business and my first degree is in 
accounting. As I look at the health care system in our country today, 
it reminds me of a Soviet-style run health care system, and here are 
some facts that people should know. That HMOs actually cost more for 
care than fee-for-service; a recent study, 18 percent more. Also it is 
funny that that 18 percent, that is the amount of money that comes out 
of an HMO for paperwork and profit. So only 82 percent of the dollars 
that are paid in to managed care actually ever go for care. If we could 
somehow in America through competition and efficiency make that 5 
percent or 6 percent, we would have 12 percent. Well, we are going to 
spend about $1.1 trillion this year on health care, and if we take 12 
percent of that, what you can see is that we would have about $150 to 
$160 billion that would go to care.
  Well, nobody would be lacking in this country. We would be able to 
care for everybody that is not insured, everybody that does not have 
care today, if, in fact, we had a system that was not bound up in 
paperwork. I have almost 33 employees in my medical practice with three 
great partners that have covered for me since I have been here. Of that 
group, somewhere between 8 and 11 every day are doing nothing but 
chasing paper associated with health care. It has nothing to do with 
getting somebody well. It has nothing to do with anything except for us 
getting paid or sending something to lawyers or sending something to 
insurance companies. That is eight people that could be working to make 
somebody well. To me, I think that the fact that 18 percent of the 
dollars in the insurance managed care and HMO industry today are going 
for paperwork and profits rather than for care leaves a whole lot 
lacking. There is no wonder that we are having difficulty keeping up 
with the rising costs.
  The last point that I would make is that the fastest growing segment 
in the cost of health care this year is prescription drugs. Our economy 
will not work unless we have competitive markets. There is no doubt, if 
you just get on the U.S. Government FTC's web site, you will find where 
they have four large pharmaceutical companies through the last year 
that have accounted for more than a billion dollars worth of price 
fixing, a billion dollars in excess prices. Well, that is 1 percent of 
the cost of pharmaceuticals this year are associated with price fixing 
that we know of, that there has already been consent decrees against. 
How much more is there?
  The second thing that we know is that they are going to spend 
somewhere between $4 and $6 billion this year advertising on 
television. Who pays for the $4 to $6 billion? We do. What happens with 
that?
  You see something, oh, I need that. So I go to the doctor so, number 
one, we are increasing utilization. What I have found in my practice is 
it takes me twice as long to take care of a patient that comes in 
because they want a drug from a prescription that they saw on TV 
because now I have to figure out is that the right drug for their 
symptoms? And if it is not, I have to convince them it is not the right 
drug. So I spend my time working against the advertising to get the 
patient what they really need.
  The third thing is the pharmaceutical companies spend $5 billion a 
year courting doctors, and it ought to stop. They spend $5 billion 
buying lunches in doctor's office. They spend $5 billion for golf 
outings for doctors. They spend $5 billion on dinners for doctors. It 
is time the American people said that is enough. We do not need to pay 
$5 billion for benefits for doctors, $6 billion for television 
advertising, and let us get rid of the $1 billion to $5 billion in 
collusion.
  If you add that up, we would see a 15 percent reduction in 
pharmaceutical prices, not a 15 percent increase.
  Mr. SHADEGG. I take it instead what we are proposing is yet another 
Government program to pay for prescription drugs and to subsidize the 
cost of those drugs.

                              {time}  2300

  I wholeheartedly agree with the gentleman that the answer to the 
problem is choice. Let patients have choice. Unfortunately, as is often 
the case, that is not in the debate in Washington right now. The debate 
as we enter the last 10 days of this political campaign is a debate 
over the failure of the United States Congress to deliver patient 
rights legislation and to pass what has now, I guess, become famous, 
since it was referred to by the Vice President in one of the debates, 
as the Dingell-Norwood or Norwood-Dingell bill, and that is the debate 
here.
  Often we debate issues, and we are way behind the marketplace. The 
American people are ahead of us. That has become a political issue. Why 
has the Congress not passed Norwood-Dingell? The answer that we hear 
is, well, you cannot get through the Senate; there is a terrible 
problem with it. It is a vitally important piece of legislation for the 
American people.
  As we kind of close out this discussion tonight, I think it is 
important to be sure that people understand that it is not a lack of 
resolve to take care of patients and doctors. The gentleman and I wrote 
a bill over a year ago, a patients' rights bill, because of this debate 
that has occurred in America, because of the abuses caused by HMOs; but 
that bill empowered doctors and patients to make health care decisions.
  That bill said, as this flowchart I just showed illustrated, that 
every single case, every single case, where an HMO turned down 
somebody's doctor and said, no, you are wrong, the patient does not 
need that care, 100 percent of those cases would go quickly through 
initial claim, internal review and straight to an external review panel 
of three doctors.
  Those three doctors had to be practicing physicians, a provision the 
gentleman insisted on. We did not want physicians who had not practiced 
in 20 years telling physicians currently practicing what they should be 
doing. We wanted physicians practicing right then. They had to have 
expertise in the area.
  Those three doctors would say, Plan, you are dead wrong. When you 
denied that care that the treating physician said was necessary and you 
said you would not pay for it, you were wrong.

[[Page 25461]]

That care should occur and occur now. Under our legislation, people 
would be able to not only get the care, but sue for the damages.
  One of the things that made me angry in this debate is the current 
system in America says if an HMO governed by this Federal law called 
ERISA we are trying to amend, by their negligence, if they injure or 
kill someone, there is no recovery.
  I have talked on the floor of this House about the tragic case of 
Florence Corcoran, whose baby was killed by a negligent decision by an 
HMO, and the Federal courts interpreting the current law said, we are 
terribly sorry, Mr. and Mrs. Corcoran, your baby was killed by the 
negligent decision of United Health Care; but under our law, you 
recover nothing.
  The legislation we want to past will address this problem. If we 
cannot get to choice and freedom, we will say 100 percent of those 
cases go to a panel of three doctors. Mr. and Mrs. Corcoran would have 
gotten in front of three doctors, had a speedy decision. We would have 
set the standard of care, the baby would probably not have died, and 
the lawsuit would not be necessary.
  The Dingell-Norwood bill, the bill that Vice President Al Gore said 
that America deeply needs, does not do that. It does not take the case 
to a panel of doctors; it takes the case straight into a courtroom, so 
that a trial lawyer can get rich.
  I am not against trial lawyers. I believe in the tort system. I think 
when there has been an injury, they ought to recover. I wish the lawyer 
representing the Corcorans had won. They deserved to win. They deserved 
to recover.
  That is not the answer that gets people care. The answer that gets 
them care gets them first to a review by an independent panel of 
doctors to say what care should be delivered. Then, if there has been a 
bad decision, there has been injury, then let it go to court. But do 
not destroy the system by letting it go straight to court and letting 
trial lawyers decide what the standard of care is.
  Mr. COBURN. The other thing is, had Mrs. Corcoran had the freedom to 
choose and had she had her own health insurance as part of her benefit 
and her control, her baby would be alive today as well, probably.
  I just want to summarize a couple of things. Number one, there are 
two real false claims out there in the political arena today. One is 
the only way to solve the prescription drug for seniors is to create a 
Federal program. I believe that is wrong. I believe in the long run all 
that does is hurt seniors, and it will hurt everyone else, because it 
fails to fix the real problem, lack of market, lack of competition, to 
allocate those resources.
  The second thing is that we are required under the political arena 
that we have today to defend passing a Patients' Bill of Rights, and 
what has happened is we are about to pass a very bad law. It passed the 
House. It has not passed the Senate. What will happen if what comes is 
a tremendous increase in costs, tremendous loss of insurance, and 
exactly the opposite direction.
  Now, I happen to be cynical enough to believe there are certain 
people that want that to happen, because they believe we ought to have 
a government-controlled health care system. Believe you me, when we get 
that, if you love the post office today, wait until you see totally 
government-run health care.
  There is not one individual that I talked to that knows anything 
about health care, from the pharmacist to the physical therapist to the 
operating room nurse to other doctors to nurses or employees in my 
office. When I mention the word HCFA, Health Care Financing 
Administration, they go ballistic, because HCFA does not know what is 
going on, but they are running all the rules. For us to create another 
system in which we hand more to HCFA is asinine.
  Mr. SHADEGG. Mr. Speaker, I simply want to reiterate what you said. 
The reality is that many people want this very complicated scheme. They 
want a Norwood-Dingell bill to pass, not because they think that will 
take care of patients. They understand turning this whole system over 
to the trial lawyers, taking it away from HMOs, but not giving it to 
doctors, but rather giving it to trial lawyers, they understand that 
that will drive costs dramatically through the roof.
  But that is not against their goal, because their goal is to have the 
current HMO system, to have the current health care system fail, and 
then to force America to turn to a single payer, Hillary-Care, one-
system-fits-all, the Federal Government runs the health care system-
type program.
  I believe that will be a tragic flaw for this Nation. If we go to a 
flawed system that lets trial lawyers circumvent independent doctors 
making the decision, if we do not give patients the right to choose 
their own doctor, the net result is that costs will go through the roof 
and we will get to a single-payer system.
  I want to thank the gentleman for allowing me to participate in this 
Special Order. It is important that our colleagues saw the flaw in this 
current patients rights legislation. I hope they will join us in 
passing legislation that would give people choice. Let them hire and 
fire their health care plan, the way they hire and fire their auto 
insurance plan or their homeowner's insurance plan, or, for that 
matter, the way they decide where they live or what brand of shoes or 
coats to buy. Give people choice, and they will take care of 
themselves.
  Mr. COBURN. I thank the gentleman from Arizona (Mr. Shadegg). It a 
pleasure to work with the gentleman, as usual. I appreciate all of the 
work he has done in health care in this Congress.
  I think the American people ought to ask themselves one question, do 
I get to choose my doctor, my health plan, and, if not, why not? When 
you hear all of the political rhetoric, it will all pencil down to 
choice, and what is happening today in America is we are losing 
freedom, we are losing liberty, when we cannot even have the basic 
right to choose our own doctor.

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