[Congressional Record (Bound Edition), Volume 146 (2000), Part 5]
[House]
[Pages 7356-7361]
[From the U.S. Government Publishing Office, www.gpo.gov]


[[Page 7356]]

                  PATIENT'S BILL OF RIGHTS CONFERENCE

  The SPEAKER pro tempore (Mr. Sherwood). Under the Speaker's announced 
policy of January 6, 1999, the gentleman from Iowa (Mr. Ganske) is 
recognized for 60 minutes as the designee of the majority leader.
  Mr. GANSKE. Mr. Speaker, on last Friday, in the USA Today, I could 
not help but notice on the front page an article. It was called ``HMOs 
Take Spiritual Approach.'' It is written by Julie Appleby. It starts 
out by saying ``Health plans, buffeted in recent years by their no-
frills approach to medical care, are pushing ever further into 
alternative medicine, hoping to find low cost ways to boost patient 
satisfaction. Need help understanding the meaning of life? No problem. 
A Denver-based HMO offers spiritual counseling, six visits at $10 a 
pop. Fearing surgery? Blue Shield of California unveils a new 
prescription today, free audio cassettes for patients aimed at 
harnessing their imaginations to promote healing.''
  Mr. Speaker, when I read this and when I also read about some of the 
abuses by some of the HMOs, I think patients will need some of this 
spiritual healing to get over some of the ways that they have been 
treated by HMOs.
  I want to talk tonight for a little while about where we stand in 
conference with the patient protection legislation that passed the 
House and the Senate. My information on how the conference is going is 
from my sources on the Republican side. There have been reports that 
the conference is making some progress. Maybe a month ago, there was 
reported progress on emergency care provisions and also on a couple 
other smaller items that should be relatively noncontroversial. It 
should be pointed out that there has been no legislative language 
divulged from any of these earlier ``agreements in principle.''
  But about a week or 2 ago, there was a report that there was progress 
being made on one of the most important parts of the bill, which is, 
how does one handle disputes between care that is requested by a 
patient and care denied by the HMO. In both the bill in the House and 
in the Senate, when there is a dispute on a denial of care by the HMO, 
a patient could take that to an external appeals panel.
  The reports in the press seem to indicate that progress was made and 
that there was some sort of agreement between the Republicans and the 
Democrats in the House-Senate conference on this point. Well, I am 
sorry to inform my colleagues on both sides of the aisle here in the 
House that these reports have been vastly overplayed.
  As a result of that, President Clinton asked for a meeting for this 
Thursday of conferees down at the White House to try to spur on 
progress on the patient's rights. But let me just point out some of the 
problems, these are from my Republican sources, on how there is not 
agreement on some of the fundamental aspects of the external appeals 
process.
  For instance, there is not agreement on the standard for determining 
whether cases are eligible for review. Mr. Speaker, this is sort of 
fundamental. One has to know what kind of cases can go to review, and 
this has not been decided.
  In determining whether a case is eligible for review, the independent 
reviewer should not be limited by a plan's definition or 
interpretations where they involve applications of medical judgment. 
This is what is in the House. This is the provision in the House where 
we say that the independent panel can make a determination on medical 
necessity that is not bound by the plan's own guidelines. They can be 
considered. The plan's guidelines can be considered, but the 
independent panel is not bound by those.
  Also, it has not been decided in terms of protection, such as the 
independent panel determining medical necessity disputes on coverage or 
benefit determinations, and which of those are not subject to review.
  Now, in the House bill, we say that if there is an explicit denial of 
coverage in the contract, then regardless of whether the patient needs 
that medical procedure or not, that independent panel cannot tell the 
HMO to give the care.
  For instance, the HMO could write a contract saying we do not cover 
liver transplants. A patient could come along, maybe medically need a 
liver transplant, but under the House bill, the independent panel 
cannot tell the HMO to give that, because there is an explicit 
exclusion of coverage. But aside from that, this crucial question has 
not been decided in the conference.
  Other things related to external review have not been decided in the 
conference. For instance, there has not been a decision on what to do 
with existing State laws that deal with external appeal systems. Now, 
in my opinion, the independent review should have the authority to 
direct the health plan to provide the care. That is what we passed here 
in the House with a vote of 275 to 151.

                              {time}  1845

  We said, okay, if there is a denial of care, if it has gone through 
an internal appeals process and goes to the external independent review 
panel, that that panel can tell the HMO to give the care. In our bill 
that passed the House, if the HMO does not give the care, then they are 
subject to a fine, a rather stiff fine. And if a patient is injured as 
a consequence of not receiving that care, then that plan would be 
liable for that. This has not been decided. This has not been decided 
in the conference.
  Furthermore, one would think that this would be an easy thing that 
could have been decided, and that is that the panel should be 
independent from the HMO. Apparently, this has not been decided in the 
conference either. So all of those reports saying that significant 
progress was being made on the appeals process, I think, are vastly 
overblown.
  Furthermore, I would point out to my colleagues, and I really do not 
need to tell them this, because all of them that have been here for 
more than 6 months know this is the case, that unless we see 
legislative language, we can talk all we want about ``principles,'' but 
one simple clause in legislative language can totally turn the intent 
of that provision around. And there is no legislative language 
available.
  So what do we have here? We have a situation where States all around 
the country are saying we need to do something about this. State 
legislature after State legislature have passed bills for patient 
protection. In fact, in Oklahoma, the State legislature just passed a 
law making it easier for patients to sue HMOs and other insurers for 
unreasonable denials of medical care. Under the Oklahoma law, a health 
plan can be required to pay damages if it fails to exercise ``ordinary 
care'' in treating patients.
  The chief sponsor of the Oklahoma bill, State Senator Brad Henry, has 
said, ``The chairman of the House Senate conference is definitely out 
of step with the public here in Oklahoma. Polling information shows 
that 72 percent of Oklahomans support giving the patient the right to 
sue.''
  That Oklahoma measure was not even a close vote. It passed 94 to 5 in 
the State House of Representatives in Oklahoma and 44 to 2 in the State 
Senate, and it was signed by Republican Governor Frank Keating on April 
28.
  Mr. Speaker, I am sorry to say that as time has gone by since we 
passed this in October last year, a lot of patients are being denied 
care by some HMOs, and I think are being injured by it. I have here 
some estimates for how many patients are being injured.
  Now, I can give my colleagues specific examples of patients who have 
been injured. I have done that many times on the floor. I have brought 
up posters showing their faces. I have brought up posters showing the 
families of women who have died because of HMO decisions and how they 
are left without their mother or their wife. But just to give some idea 
of the magnitude of the problem that we are dealing with, there have 
been two recent studies from which we can extrapolate how many cases 
each day in this country we are seeing of HMO denial and abuse causing 
pain and suffering and injury to patients.
  The studies that I am citing here are Helen Schauffler's California 
Managed

[[Page 7357]]

Health Care Improvement Task Force Survey of Public Perceptions and 
Experiences with Health Insurance Coverage from the University of 
California Berkeley School of Public Health and Field Research 
Corporation. This was reported in Improving Managed Health Care in 
California, Findings and Recommendations. And also a study from the 
Committee Analysis Based on Kaiser Family Foundation and Harvard Public 
School of Health called Survey of Physicians and Nurses, July 1999.
  Here are some of the highlights that my colleagues can take from 
these studies showing what is going on every day around the country. 
According to these two studies, every day 59,000 patients, because of 
HMO inappropriate denials of care, experience added pain and suffering.
  According to these studies, every day, 41,000 patients experience a 
worsening of their medical condition. According to these studies, every 
day 35,000 patients have had needed care delayed.
  Thirty-five thousand patients have a specialty referral delayed or 
denied every day. Thirty-one thousand patients every day are forced to 
change doctors. Eighteen thousand patients every day are forced to 
change medications.
  And every day 14,000 physicians see patients whose health care has 
seriously declined because an insurance plan refused to provide 
coverage for a prescription drug. Mr. Speaker, every day in this 
country 10,000 physicians see patients whose health has seriously 
declined because an insurance plan did not approve a diagnostic test or 
a procedure.
  And every day 7,000 physicians see patients whose health has 
seriously declined because an insurance plan did not approve referral 
to a medical specialist. And, Mr. Speaker, every day 6,000 physicians 
see patients whose health has seriously declined because an insurance 
plan did not approve an overnight hospital stay.
  These are pretty amazing statistics. If we want to talk about the 
number of patients each year in this country who experience HMO abuse 
in delay of needed care, we are dealing with almost 13 million.
  Each year, 12,800,000 patients experience HMO plan abuse in terms of 
delay or denial of care. It is about 11 million patients each year in 
this country that have to change their doctors because of HMOs. It is 
about 6,500,000 patients each year in this country that are forced to 
change medications. It is about 22 million patients in this country 
that each year have added pain and suffering because of HMO decisions 
and abuse, and about 15 million patients each year in this country see 
their medical conditions worsen because of HMO abuse.
  And here we are. It has been, what, 7, 8 months since we passed the 
bill in the House? We have been working on this for 4 or 5 years. We 
could multiply these annual numbers by four or five times and it would 
begin to approach the magnitude of the problem that we are dealing with 
on this.
  A few years ago, in testimony before my committee, the Committee on 
Commerce, a small, quiet woman, who was a medical reviewer for an HMO, 
gave some very compelling testimony. She said that she had actually 
made medical decisions that had cost patients' lives and that she had 
been rewarded for that by HMOs. She said, and I am paraphrasing her, 
``I am coming clean. I cannot tolerate this any more.'' She said, ``I 
made a medical decision that cost a man his life. He needed an 
operation on his heart and I denied it. It was medically necessary for 
him.''
  And then she pointed out what the smart bomb is of cost containment 
for HMOs, and that is in the area of denials based on ``medical 
necessity'', which HMOs can arbitrarily define, according to Federal 
law, any way they want to. Some HMOs even define medical necessity as 
``the cheapest, least expensive care.'' Now, think of that for a 
minute. Would we like our health plan to define medical necessity for 
us as the cheapest, least expensive care? Now, one might say, well, 
that would help hold costs down. But it would also result in some 
really bizarre activities.
  Before coming to Congress, I was a reconstructive surgeon. I took 
care of a lot of kids with cleft lips and palates. The standard 
treatment for a kid with a cleft lip and a cleft palate is surgical 
correction. The hole in the roof of the mouth is surgically corrected 
so that they can learn to speak normally, so that they do not have food 
coming out of their nose. Under that irresponsible definition of 
medical necessity, as the cheapest, least expensive care, that HMO 
would be totally justified in just giving this little baby a piece of 
plastic to shove up into the roof of his mouth so that food would not 
come out. Sort of like an upper denture. I think that is really 
ridiculous.
  I have given some talk on this floor about some practice guidelines 
that a company by the name of Milliman and Robertson, sort of the HMO 
flack house, has created. If it were not for the fact they have sold 
about 20,000 of these guidelines around the country to hospitals and 
HMOs, we would not need to talk so much about this. But in a previous 
talk here on the floor I gave a lot of examples of how wrong, how far 
away from standards of care those guidelines are.
  I recently got a letter from Milliman and Robertson trying to explain 
where they come up with some of these. I think this article that is in 
Pediatrics, the journal Pediatrics, Volume 105, No. 4, April 2000, is a 
much more scientific approach to analyzing the validity of Milliman and 
Robertson's guidelines.
  Let me just read the conclusion. ``In New York State, during 1995, 
length of stay for selected pediatric conditions was generally in 
excess of published Milliman and Robertson guidelines.''
  I love how these conclusions always understate what the article says. 
They say, ``This raises concern about the potential effects of such 
guidelines on both patients and the hospitals caring for them.'' They 
go on and say in the text of this, ``Several studies have demonstrated 
that certain length of stay related guidelines adversely affect patient 
care,'' and then they list a number of them. I just want to quote some 
of these to give a flavor for the analysis in the medical literature of 
some of these ``guidelines.''
  Jerome Kassirer, in the New England Journal of Medicine, wrote an 
article on The Quality of Care and the Quality of Measuring It. Arnold 
Relman, Reforming the Health Care System, the New England Journal of 
Medicine. Wilson, in Medical Decision Making, Primary Care Physicians' 
Attitudes Toward Clinical Practice Guidelines. Fitzgerald, in the New 
England Journal of Medicine, The Care of Elderly Patients With Hip 
Fracture: Changes Since Implementation of Prospect of Payment system. 
Mitchell, Who Are Milliman & Robertson and How Did They Get in My 
Face?, in the Journal of the Kentucky Medical Association.
  Well, what do these articles have in common? They have in common what 
this article in the journal Pediatrics found, and that was that the 
length of stay recommendations put out by this company, Milliman and 
Robertson, are really far out. They say in this article, ``Numerous 
commentaries in both the lay and medical press have raised concerns 
regarding the largely unknown impact of guidelines on health of the 
more vulnerable populations, particularly the elderly, the young, and 
the chronically ill. Our findings demonstrate that actual pediatric 
length of stay in New York State during 1995 exceeded, often markedly, 
the Milliman and Robertson functional length of stay guidelines. The 
difference was most marked in diagnoses with long courses of 
antibiotics, for instance, bacterial meningitis, osteomyelitis, and 
complicated appendectomy.''
  In a previous talk I gave, I pointed out that the average length of 
stay in a hospital for somebody with a really serious infection, this 
is for a child, like bacterial meningitis, is somewhere around a week, 
if not longer. That is usual and that is customary. These kids are 
really sick. Milliman and Robertson recommends one or two days, one or 
two days in the hospital for somebody who has a serious bacterial 
infection of their brain or their spinal cord and who could die from 
that.

                              {time}  1900

  I know something personally about this because about 3 years ago now 
I

[[Page 7358]]

had a bad case of encephalitis. It is impossible for me to believe that 
a patient with even a moderate case of encephalitis could be discharged 
in 1 or 2 days. It just boggles my mind.
  There are many quotes in this study. Let me just read a few. ``Both 
the Institute of Medicine and the Agency for Health Care Policy and 
Research have set high standards for the development of guidelines, 
including the involvement of multi-disciplinary panels and the use of 
explicit evidence-based approaches. This is a methodology used by 
governmental groups such as the Institute of Medicine.
  ``At a minimum, we should expect that the data and methods 
contributing to Milliman and Robertson's guidelines be available for 
public discussion and debate.''
  They are not, unfortunately.
  That is why that lady who was a medical reviewer who testified for my 
committee said those determinations based on plan guidelines are the 
smart bomb of HMO's cost containment.
  But there is something that needs to be dealt with in terms of the 
external appeals process that we are dealing with in conference between 
the House and the Senate. And if they are not dealt with, and as I 
repeat, to date, my sources on the Republican side tell me they have 
not been dealt with, then we should not be releasing reports to the 
press saying that there is significant progress being made in that 
conference.
  I think that the conferees, when they go down to the White House, 
ought to really make an effort to move on this.
  There are many other things that I could speak about in terms of 
where we are at with various issues related to the patient protection. 
I want to just deal with about four or five.
  The first is that the bill that passed this House on patient 
protection would lead to a flood of litigation. That is just not true. 
Our bill was modeled after the bill that passed in Texas about 3 years 
ago, and there have only been a handful of lawsuits since that time in 
Texas.
  Of those lawsuits, though, I would say several are meritorious. Let 
me give my colleagues one example.
  There is a patient named Mr. Piloseca who was in the hospital 
suicidal. His doctor recommended that he stay in the hospital to be 
treated for his suicidal tendencies. His health plan, NYLCare, said, 
no, no, you are out the door.
  Maybe they used their own guidelines. Maybe they used Milliman and 
Robertson's guidelines. I do not know. They said, you are out the door 
and we are not going to pay for any hospitalization.
  Under that circumstance, under Texas law, where there is a dispute 
between the physician and the health plan, the health plan is supposed 
to go to an expedited review to that independent panel for a 
determination.
  What did they do? They just ignored it and said, we are not going to 
pay for your hospitalization. Unless you want to pay for it yourself, 
then you are out of here.
  Well, this family is of average modest means and they do not have the 
ability to do that. So Mr. Piloseca went home that night and, sure 
enough, suicidal that he was, he drank half a gallon of antifreeze and 
he committed suicide.
  That health plan is being sued in Texas. That is one of the handful. 
But they are being sued because they did not follow the law that was in 
Texas.
  Hardly a flood of lawsuits.
  Then there are opponents to our bill that passed the House that say, 
oh, employers could be sued under the bill that passed the House.
  And I will tell my colleagues that, under the bill that passed the 
House, the Norwood-Dingell-Ganske bill, the bipartisan consensus 
Managed Care Reform Act, an employer can only be sued or held legally 
accountable if that employer exercises discretionary authority in 
making a decision that results in negligent harm to the patient.
  Most employers are nowhere near that. I have got lots of small 
businesses in my district. Those businesses hire an HMO to provide 
health care for themselves and for their employees. They do not get 
involved in the medical decision-making. And if they are not involved 
in the medical decision-making, they cannot be held liable.
  Furthermore, in our bill that passed the House, we expressly stated 
that employers cannot be sued for choosing to contract with a 
particular health plan, deciding which benefits to include in the plan, 
or deciding to provide additional benefits not generally covered by the 
plan.
  Mr. Speaker, here is another myth. The myth is that, well, if you 
just have a strong appeals process, there is no need for any legal 
accountability.
  I would just refer you back to the case I just told you about. If do 
you not have accountability, what is going to make the HMO follow the 
law?
  I would point out this. Many times I have talked on this floor about 
a little boy from Atlanta, Georgia, who, when he was 6 months old, was 
really sick, his mom and dad had to take him to the emergency room in 
the middle of the night, but he was only given an authorization to go 
to an emergency room that was about 60 or 70 miles away instead of 
stopping at any two or three emergency rooms that were very close to 
their room.
  That was a medical decision, a medical judgment, that that reviewer 
made over the telephone. Unfortunately, he had a cardiac arrest in the 
car before he got to this far-away emergency room. They managed to keep 
him alive, but he suffered circulatory loss to his hands and feet and 
he lost both of his hands and both of his feet.
  Now, there was not any chance to have to go to an independent appeals 
process in that situation. But that HMO made a medical judgment, and 
they should be responsible for that.
  I can give my colleagues several other real-life examples. How about 
the patient who sustained injuries to his neck and spine in a 
motorcycle accident. He was taken to the hospital. The hospital's 
physicians recommended immediate surgery. But the health plan refused 
to certify that surgery. Time and time and time went on. And what 
happened? The patient was paralyzed.
  How about the patient who was admitted to an Emergency Room in his 
community hospital complaining of paralysis and numbness in his 
extremities. The treating room emergency physician concluded that this 
was a really serious case, he needed to go to the medical school 
immediately. The health plan denied authorization for a transfer. Hours 
and hours later, by this time, the patient is now quadriplegic, i.e., 
paralyzed in both his hands and both his legs.
  You need to have accountability, not just on the more leisurely cases 
that come along, but also from the get-go.
  How about this: People say that the bill that passed the House could 
significantly increase the cost of health insurance and the number of 
insured. And I say baloney. The Congressional Budget Office looked at 
our bill, and the legal accountability provision was estimated to raise 
premiums one percent over 4 years.
  A one percent equivalent over 4 years is equal to employers paying a 
mere 4 cents per day for individual coverage with employees 
contributing just one additional penny per day.
  Now, opponents also of our bill have said, oh, for every one percent 
increase in premiums, you are going to have 400,000 people lose their 
jobs. That is baloney, too. Nobody has ever documented where that 
statistic came from. But the General Accounting Office did a study of 
it and they said, that is wrong, it is outdated, it does not account 
for the relevant factors.
  So people came back and said, well, maybe it is only 300,000 people 
will lose their insurance if premiums go up 1 percent. GAO came back 
again and looked at that data and said, wrong, wrong, the statistics do 
not show that.
  And furthermore, I would point out this: Between 1988 and 1996, the 
number of workers offered coverage actually increased in this country 
despite increased premiums each year.
  I would also point out to my colleagues that we did not pass this 
bill and it has not become Federal law and premiums went up last year. 
Why? Because the HMOs wanted to show it on their bottom line profit 
statements for Wall Street.

[[Page 7359]]

  Then opponents say, well, you know what, consumer support for this 
bill will evaporate if consumers learn how much it is going to cost 
them.
  Let me cite to my colleagues a 1998 nationwide survey by Penn, Shown 
& Burlin that showed that 86 percent of the public support a bill that 
would give patients health plan legal accountability, access to 
specialists, emergency services, and point-of-service coverage. When 
asked if they would support such a bill if their premiums increased 
between $1 and $4 a month, 78 percent, more than three-fourths of the 
people in this country, said, you bet.
  Now, I want to tell my colleagues what the bill that passed the House 
would cost. The House-passed bill would raise insurance premiums an 
average of 4.1 percent, covering to the Congressional Budget Office, 
over 4 years. Do my colleagues know how much that would account for an 
individual?
  Remember, 78 percent of people in this country say that they want to 
see Congress pass this law even if it means to them an increase in cost 
between $1 and $4. Dollars. For an individual, that percentage increase 
would cost $1.36 per month and, for a family of four, $3.75 per month.
  Do my colleagues know what? That is less than what a Big Mac meal 
costs me out at National Airport. And that is giving people assurance 
that all the money that they are spending for their health insurance 
actually means something when they get sick.
  I think that is why a recent public opinion survey found that most 
Americans believe problems with managed care have not improved, 74 
percent, and most think that legislative action is either more urgent 
or equally urgent as it was when this debate began several years ago, 
88 percent. That is from the Kaiser Family Foundation survey of 
February this year.
  Mr. Speaker, it is clear, when we start looking at how many patients 
every day are being injured or denied care because Congress is sitting 
here doing nothing, or maybe because some Members of Congress are 
listening to the insurance industry and the HMO industry, we need to 
get something done on this.
  I just want to go over these figures one more time for my colleagues. 
According to a couple reports that I have cited earlier, every day, as 
a result of inaction in this Congress for addressing this HMO problem, 
we are seeing 59,000 patients experience added pain and suffering, we 
are seeing 41,000 patients experience a worsening of their medical 
condition, we are seeing 35,000 patients having needed care delayed, 
35,000 patients with a specialty referral delayed or denied, 31,000 
patients are forced to change doctors, and 18,000 patients are forced 
to change medications needlessly.
  Mr. Speaker, it should be clear that the conferees to the HMO reform 
bill should really get off their fannies and get to work. When they go 
down to the White House on Thursday, as I hope they do, I hope in good 
faith they sit down and try to get something done and not just try to 
ride out the time clock on this year.
  Mr. Speaker, I am happy to yield to my friend and colleague the 
gentleman from California (Mr. Horn). I know he wants to speak some 
about health care, also.
  Mr. HORN. Mr. Speaker, I thank the gentleman for yielding to me. He 
has been marvelous in terms of bringing to the American people the need 
for a decent health care program.
  Mr. Speaker, health care paperwork has become a complex and often 
confusing problem for many Americans. Many of us have experienced the 
confusion of erroneous billings, lengthy delays in reimbursement, and 
troubling disputes about what is and is not covered under a health care 
plan.
  These problems are of particular concern in the Medicare program, the 
largest purchaser of health care in the world and a program that is 
absolutely vital to nearly 40 million senior citizens who rely on its 
services.
  In the early 1990's, the Medicare program was designated as one of 
the Government's high-risk programs by the Comptroller General of the 
United States and his General Accounting Office.
  Medicare's size, complexity, and lack of management controls are a 
problem and worthy of our attention. Each year the House Subcommittee 
on Government Management Information and Technology, which I chair, 
conducts oversight hearings to determine what progress has been made in 
resolving the management problems within Medicare. Each year we are 
told that significant progress has been made and more is expected soon.

                              {time}  1915

  Mr. Speaker, it is true that progress has been made. Two years ago, 
the Inspector General of the Department of Health and Human Services 
reported that erroneous bills in the Medicare program totalled an 
estimated $20.3 billion in fiscal year 1997. That was 11 percent of all 
Medicare billings that year. In short, one of every $10 spent by 
Medicare was an improper payment. This year, the Inspector General, the 
very able June Gibbs Brown, returned to testify that the error rate was 
now estimated at $13.5 billion for fiscal year 1999, or about 8 percent 
of total billings.
  As I said, that is in fact progress. We are moving in the right 
direction, but I am still stopped cold by those numbers. Medicare 
improperly paid out $13.5 billion last year for claims that were not 
covered by the program, for claims that were, to quote the General 
Accounting Office, ``not reasonable, necessary and appropriate.''
  Mr. Speaker, all of us know that the Medicare program is a very large 
and complex operation and presents an enormous management challenge. 
The program still operates under the rules set in 1965. Medicare uses 
private insurance companies as the contractors and intermediaries 
between the patient, the doctor, the hospital to process bills and 
those that go to Medicare. That paper flow is a virtual Niagara Falls. 
Every day, the Medicare program's contractors process about 3.5 million 
claims worth an average of more than $650 million a day. That is every 
day of the year. Managing this flow is indeed a major challenge.
  But, Mr. Speaker, the challenges in the Medicare program are not new. 
Medicare has been in existence for 35 years and its specific management 
problems have been documented in excruciating detail by a long list of 
reports from the Inspector General and the Comptroller General of the 
United States, the head of the General Accounting Office. Even with all 
of the attention and concern, serious management deficiencies continue 
to plague this program and waste or misspent billions of Medicare 
dollars.
  In all of the reports on Medicare's problems, the key recommendation 
has been this. Medicare must develop a fully integrated financial 
management system, standardized with all of its contractor 
intermediaries so that timely, accurate and meaningful information can 
be developed to control this $300 billion a year program.
  Mr. Speaker, today I am introducing H.R. 4401. This legislation can 
move us toward the goal of first rate management. This bill has been 
introduced in the other body by Senator Richard Lugar of Indiana. I 
have a very high regard for Senator Lugar. His bill in the other body 
is S. 2312, and H.R. 4401 is similar to his legislation. In brief, we 
are working together and the two of us believe that enacting sound and 
effective controls on the Medicare program must be made a very high 
priority.
  The Health Care Infrastructure Investment Act is designed to force 
the creation of an advanced information infrastructure that will allow 
the Medicare program to instantly process the vast number of 
straightforward transactions that now clog the pipeline and drain off 
scarce health care resources. The bill calls for the development and 
implementation of an integrated system so that Medicare and its 
contractors can serve seniors with immediate points of service and 
verification of insurance coverage, point of service checking for 
incomplete or erroneous claim submission, and point of service 
resolution of simple, straightforward claims for doctor's office 
visits, including the delivery of

[[Page 7360]]

an explanation of benefits and payment that the patient can understand. 
That means that when Medicare beneficiaries walk into the doctor's 
office, they can know immediately what their benefits are and what 
copayments or deductibles apply. When they leave, they will receive a 
simple statement of what was done and what is owed.
  Our bill is careful to avoid mandates that would undermine privacy 
rights. Privacy is of paramount concern and must be safeguarded in the 
design of an advanced network of financial management systems for 
Medicare. The goal of H.R. 4401 is to reduce and, where possible, to 
eliminate paperwork. Greater efficiency will free doctors to spend more 
time treating patients, doctor's offices and insurance companies should 
be able to reduce the cost of claims processing, and patients will be 
fully informed about treatments and costs.
  Mr. Speaker, this legislation could save the taxpayers billions of 
dollars every year, and it would not be wasting Medicare access, 
either. It would get us to modernize the paperwork and the 
inefficiencies and put an end to many time-consuming and confusing 
complications in the billing process for doctor office visits, and both 
for doctors and for patients.
  This bill, H.R. 4401, also can lay the foundation for modernizing 
Medicare's financial management systems so that the annual reports of 
billions of dollars misspent will become a thing of the past. Then we 
can be assured that every Medicare dollar is being properly used to pay 
for the health care our seniors need. Our bill, H.R. 4401 in the House, 
will be sent to the Committee on Commerce, the Committee on Government 
Reform and Ways and Means.
  Mr. Speaker, I include a copy of H.R. 4401 as follows:

                               H.R. 4401

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Health 
     Care Infrastructure Investment Act of 2000''.
       (b) Table of Contents.--The table of contents of this Act 
     is as follows:

Sec. 1. Short title; table of contents.
Sec. 2. Moratorium on delayed payments under contracts that provide for 
              the disbursement of funds.
Sec. 3. Establishment of the Health Care Infrastructure Commission.
Sec. 4. Study and final recommendations; timetable for implementation 
              of advanced informational infrastructure.
Sec. 5. Application of advanced informational infrastructure to the 
              FEHBP.
Sec. 6. Authorization of appropriations.

     SEC. 2. MORATORIUM ON DELAYED PAYMENTS UNDER CONTRACTS THAT 
                   PROVIDE FOR THE DISBURSEMENT OF FUNDS.

       Section 1842(c) of the Social Security Act (42 U.S.C. 
     1395u(c)) is amended by striking paragraph (3).

     SEC. 3. ESTABLISHMENT OF THE HEALTH CARE INFRASTRUCTURE 
                   COMMISSION.

       (a) Establishment.--There is established within the 
     Department of Health and Human Services a Health Care 
     Infrastructure Commission (in this section referred to as the 
     ``Commission'') to coordinate the expertise and programs 
     within and among departments and agencies of the Federal 
     Government for the purposes of designing and implementing an 
     advanced informational infrastructure for the administration 
     of Federal health benefits programs.
       (b) Duties.--The Commission shall--
       (1) establish an advanced informational infrastructure for 
     the administration of Federal health benefits programs which 
     consists of an immediate claim, administration, payment 
     resolution, and data collection system (in this section 
     referred to as the ``system'') that is initially for use by 
     carriers to process claims submitted by providers and 
     suppliers under part B of the medicare program under title 
     XVIII of the Social Security Act (42 U.S.C. 1395j et seq.) 
     after conducting the study under section 4(a)(1);
       (2) implement such system in accordance with the final 
     recommendations published under subsection (a)(2) of section 
     4 and the timetable set forth under subsection (b) of such 
     section; and
       (3) carry out such other matters as the Secretary of Health 
     and Human Services (in this section referred to as the 
     ``Secretary''), in consultation with the other members of the 
     Commission, may prescribe.
       (c) Membership.--
       (1) Number and appointment.--The Commission shall be 
     composed of 7 members as follows:
       (A) The Secretary, who shall be the chairperson of the 
     Commission.
       (B) One shall be appointed from the National Aeronautics 
     and Space Administration by the Administrator.
       (C) One shall be appointed from the Defense Advanced 
     Research Projects Agency by the Director.
       (D) One shall be appointed from the National Science 
     Foundation by the Director.
       (E) One shall be appointed from the Office of Science and 
     Technology Policy by the Director.
       (F) One shall be appointed from the Department of Veterans 
     Affairs by the Secretary.
       (G) One shall be appointed from the Office of Management 
     and Budget by the Director.
       (2) Requirements.--Each of the members appointed under 
     subparagraphs (B) through (G) of paragraph (1) shall--
       (A) have been appointed as an officer or employee of the 
     agency by the President by and with the advice and consent of 
     the Senate; and
       (B) be an expert in advanced information technology.
       (3) Deadline for initial appointment.--The members of the 
     Commission shall be appointed by not later than 3 months 
     after the date of enactment of this Act.
       (d) Meetings.--
       (1) In general.--The Commission shall meet at the call of 
     the chairperson, except that it shall meet--
       (A) not less than 4 times each year; or
       (B) on the written request of a majority of its members.
       (2) Quorum.--A majority of the members of the Commission 
     shall constitute a quorum, but a lesser number of members may 
     hold hearings.
       (e) Compensation.--Each member of the Commission shall 
     serve without compensation in addition to that received for 
     the services of such member as an officer or employee of the 
     United States.
       (f) Staff.--
       (1) in general.--The chairperson of the Commission may, 
     without regard to the civil service laws and regulations, 
     appoint and terminate an executive director and such other 
     additional personnel as may be necessary to enable the 
     Commission to perform its duties.
       (2) Compensation.--The chairperson of the Commission may 
     fix the compensation of the executive director and other 
     personnel without regard to the provisions of chapter 51 and 
     subchapter III of chapter 53 of title 5, United States Code, 
     relating to classification of positions and General Schedule 
     pay rates, except that the rate of pay for the executive 
     director and other personnel may not exceed the rate payable 
     for level V of the Executive Schedule under section 5316 of 
     such title.
       (3) Detail of government employees.--Any Federal Government 
     employee may be detailed to the Commission without 
     reimbursement, and such detail shall be without interruption 
     or loss of civil service status or privilege.
       (g) Procurement of Temporary and Intermittent Services.--
     The chairperson of the Commission may procure temporary and 
     intermittent services under section 3109(b) of title 5, 
     United States Code, at rates for individuals which do not 
     exceed the daily equivalent of the annual rate of basic pay 
     prescribed for level V of the Executive Schedule under 
     section 5316 of such title.
       (h) Termination.--The Commission shall terminate on the 
     date on which the system is fully implemented under section 
     4(b)(3).

     SEC. 4. STUDY AND FINAL RECOMMENDATIONS; TIMETABLE FOR 
                   IMPLEMENTATION OF ADVANCED INFORMATIONAL 
                   INFRASTRUCTURE.

       (a) Study and Final Recommendations.--
       (1) Study.--The Commission shall conduct a study during the 
     3-year period beginning on the date of enactment of this Act 
     on the design and construction of an immediate claim, 
     administration, payment resolution, and data collection 
     system (in this section referred to as the ``system'') that--
       (A) immediately advises each provider and supplier of 
     coverage determinations;
       (B) immediately notifies each provider or supplier of any 
     incomplete or invalid claim, including--
       (i) the identification of any missing information;
       (ii) the identification of any coding errors; and
       (iii) information detailing how the provider or supplier 
     may develop a claim under such system;
       (C) allows for proper completion and resubmission of each 
     claim identified as incomplete or invalid under subparagraph 
     (B);
       (D) allows for immediate automatic processing of clean 
     claims (as defined in section 1842(c)(2)(B)(i) of the Social 
     Security Act (42 U.S.C. 1395u(c)(2)(B)(i)) so that a provider 
     or supplier may provide a written explanation of medical 
     benefits, including an explanation of costs and coverage to 
     any beneficiary under part B of the medicare program under 
     title XVIII of the Social Security Act (42 U.S.C. 1395j et 
     seq.) at the point of care; and
       (E) allows for electronic payment of claims to each 
     provider and supplier, including payment through electronic 
     funds transfer, for each claim for which payment is not made 
     on a periodic interim payment basis under such part.
       (2) Final recommendations.--
       (A) Publication.--Not later than 3 years after the date of 
     enactment of this Act, the

[[Page 7361]]

     chairperson of the Commission shall publish in the Federal 
     Register final recommendations that reflect input from each 
     interested party, including providers and suppliers, 
     insurance companies, and health benefits management concerns 
     using a process similar to the process used for developing 
     standards under section 1172(c) of the Social Security Act 
     (42 U.S.C. 1320d-1(c)).
       (B) Considerations.--In developing the final 
     recommendations to be published under subparagraph (A), the 
     Commission shall--
       (i) make every effort to design system specifications that 
     are flexible, scalable, and performance-based; and
       (ii) ensure that strict security measures--

       (I) guard system integrity;
       (II) protect the privacy of patients and the 
     confidentiality of personally identifiable health insurance 
     data used or maintained under the system; and
       (III) apply to any network service provider used in 
     connection with the system.

       (b) Timetable.--The timetable set forth under this 
     subsection is as follows:
       (1) Initial implementation.--Not later than 5 years after 
     the date of enactment of this Act, the system shall support--
       (A) 50 percent of queries regarding coverage 
     determinations;
       (B) 30 percent of determinations regarding incomplete or 
     invalid claims; and
       (C) immediate processing at the point of care of 40 percent 
     of clean claims submitted by providers and suppliers under 
     part B of the medicare program.
       (2) Intermediate implementation.--Not later than 7 years 
     after the date of enactment of this Act, the system shall 
     support--
       (A) 70 percent of queries regarding coverage 
     determinations;
       (B) 50 percent of determinations regarding incomplete or 
     invalid claims; and
       (C) immediate processing at the point of care of 60 percent 
     of clean claims submitted by providers and suppliers under 
     part B of the medicare program.
       (3) Full implementation.--Not later than 10 years after the 
     date of enactment of this Act, the system shall support--
       (A) 90 percent of queries regarding coverage 
     determinations;
       (B) 60 percent of determinations regarding incomplete or 
     invalid claims; and
       (C) immediate processing at the point of care of 40 percent 
     of the total number of claims submitted by providers and 
     suppliers under part B of the medicare program.

     SEC. 5. APPLICATION OF ADVANCED INFORMATIONAL INFRASTRUCTURE 
                   TO THE FEHBP.

       (a) In General.--The Office of Personnel Management (in 
     this section referred to as the ``Office'') shall--
       (1) adapt the immediate claim, administration, payment 
     resolution, and data collection system established under 
     section 3 (in this section referred to as the ``system'') for 
     use under the Federal employees health benefits program under 
     chapter 89 of title 5, United States Code; and
       (2) require that carriers (as defined in section 8901(7) of 
     such Code) participating in such program use the system to 
     satisfy certain minimum requirements for claim submission, 
     processing, and payment in accordance with the timetable set 
     forth in subsection (b).
       (b) Timetable.--The timetable set forth in this subsection 
     is as follows:
       (1) Initial implementation.--Not later than 5 years after 
     the date of enactment of this Act, the Office shall require 
     that carriers use the system to process not less than--
       (A) 50 percent of queries regarding coverage 
     determinations;
       (B) 30 percent of determinations of incomplete or invalid 
     claims; and
       (C) immediate processing at the point of care of 10 percent 
     of the total number of claims.
       (2) Intermediate implementation.--Not later than 7 years 
     after the date of enactment of this Act, the Office shall 
     require that carriers use the system to support not less 
     than--
       (A) 70 percent of queries regarding coverage 
     determinations;
       (B) 50 percent of determinations regarding incomplete or 
     invalid claims; and
       (C) immediate processing at the point of care of 20 percent 
     of the total number of claims.
       (3) Full implementation.--Not later than 10 years after the 
     date of enactment of this Act, the Office shall require that 
     carriers use the system to support not less than--
       (A) 90 percent of queries regarding coverage 
     determinations;
       (B) 60 percent of determinations of incomplete or invalid 
     claims; and
       (C) immediate processing of 35 percent of the total number 
     of claims.

     SEC. 6. AUTHORIZATION OF APPROPRIATIONS.

       (a) In General.--There are appropriated to the Health Care 
     Infrastructure Commission established under section 3, out of 
     any funds in the Treasury that are not otherwise 
     appropriated, such sums as may be necessary to carry out the 
     provisions of this Act.
       (b) Availability.--Any sums appropriated under subsection 
     (a) shall remain available until the termination of the 
     Health Care Infrastructure Commission under section 3(h).

  The SPEAKER pro tempore (Mr. Sununu). The gentleman from Iowa (Mr. 
Ganske) has 18 minutes remaining.
  Mr. GANSKE. Mr. Speaker, I just point out that my colleague from 
California has been a stalwart in working on matters of health concern 
for his constituents and in particular has been very strong on 
supporting a Patient's Bill of Rights. I appreciate his work and effort 
in that very much.

                          ____________________