[Congressional Record (Bound Edition), Volume 147 (2001), Part 7]
[House]
[Pages 9903-9908]
[From the U.S. Government Publishing Office, www.gpo.gov]



                 TAX CUTS AND PATIENTS' BILL OF RIGHTS

  The SPEAKER pro tempore (Mr. Issa). Under the Speaker's announced 
policy of January 3, 2001, the gentleman from Iowa (Mr. Ganske) is 
recognized for 60 minutes as the designee of the majority leader.
  Mr. GANSKE. Mr. Speaker, I want to talk a little bit tonight about 
two issues: first, about the tax cuts that passed the House and the 
Senate just before Memorial Day recess; then I will talk a little bit 
about the patients' bill of rights.
  Mr. Speaker, I remember in early 2000, it was before the Iowa 
caucuses, it was cold, I remember, and I was traveling around the State 
of Iowa, my home State, with then-Governor Bush.
  We had spent the morning together, and then returned to Des Moines 
where he was going to address the Des Moines Chamber of Commerce and 
give a major address on cutting taxes.
  So Governor Bush asked me if I would sit in and listen to him give 
his speech in preparation. There was just myself and one staffer. We 
were at the Marriott Hotel in Des Moines, and they had the rest of the 
doors closed off. Then-Governor Bush practiced his speech. I sat there 
listening to at that time Governor Bush lay out his tax cut plan.
  Afterwards the Governor invited me upstairs and we had a hamburger 
together, just the two of us. Then-Governor Bush asked me, Well, what 
do you think? Well, we had been through here in the House a major tax 
cut bill not too long before that. It was in the range of about $790 
billion, and President Clinton had promised a veto of that bill. In 
addition, we were doing that tax cut not in the context of a budget 
plan, and certainly not in the context of how much we were going to 
reduce the national debt.
  Once President Clinton declared that he was going to veto that tax 
cut, then it gave free rein to every Member of this House and the other 
body to add every piece of special-interest tax cut legislation they 
could to that bill. It became what we would call here in Washington a 
Christmas tree on which Members could hang every little piece of 
special-interest ornamentation, with the full realization that in the 
end there would be no harm because the President said he was going to 
veto that bill.
  Mr. Speaker, sure enough, the final project, the bill, it was full of 
special-interest provisions. And so in the light of that, when then-
Governor Bush asked me over our cheese burgers what I thought of his 
bill, I said, I think it holds together. You do it in the context of 
reducing some debt, providing for some educational funding, and it will 
be okay. But my one piece of advice would be keep it free of all of 
those special-interest perks and special-interest items that got added 
to the last bill we dealt with. Focus on eliminating the marriage 
penalty tax. Focus on killing the death tax. Focus on reducing rates 
and make it a progressive cut. And if you handle that, if that is what 
the bill is, and it does not have all of these special-interest perks, 
then I think the American public is going to be happy with it.
  Then-Governor Bush said I assure you, I will do everything in my 
power if I am elected President to make sure that we do not load that 
bill up with a bunch of special-interest provisions that expand that 
Tax Code out, little pieces of tax legislation that act for individual 
families or individual businesses. We will work to keep that out and 
keep it clean. You know what, Mr. Speaker, that is what we did.
  Now, I would be the first to admit that I have not read every single 
line of that tax cut. To be quite frank, unless you have the whole Tax 
Code with you and can reference things, it is difficult to read and 
understand what every single sentence means. But I do know that a whole 
bunch of people have been looking at that tax cut, the one that we just 
passed, and the one that this week the President in a Rose Garden 
signing ceremony is going to sign into law.
  There was a report in the New York Times just a few days ago that 
said they could only find one item that was a special-interest item in 
the Tax Code, and that was a repeal of a prior special-interest item 
for JC Penney. So the only thing that I am aware of that anyone has 
found that was a special-interest piece of legislation in this was a 
repeal of a prior piece of special-interest tax legislation.
  I think, Mr. Speaker, that is a remarkable accomplishment. I think it 
is remarkable the leadership the President showed on this issue. This 
is a victory for him; but more importantly, it is a victory for the 
American taxpayer because clearly with the amount of surplus that we 
have projected, surplus taxes, it is reasonable to return some of that 
to the American people; and it is reasonable to fix certain inequities 
in the Tax Code.
  It is unfair that for a couple who is living together but not legally 
married, that when they decide to formalize that relationship and they 
get married, that they should end up paying more taxes than if they 
just filed separately. We fixed that in this bill.
  I have hundreds if not thousands of small businesses in my district, 
which is Des Moines, Iowa, and southwest Iowa, that are going to 
benefit from the provisions on killing the death tax.
  There are thousands of people in Iowa, and I think millions in the 
United States, that when you add in the fact that we are reducing the 
bottom rate from 15 percent to 10 percent, that we are doubling the 
child tax credit, that we are allowing for increased deductibility in 
pensions, they will find that they are not going to pay any Federal 
taxes, and they are also going to get a rebate this year; and I think 
that is good for the economy, too.
  Mr. Speaker, I am looking forward to that Rose Garden signing 
ceremony, and I am also looking forward to flying back to Iowa with 
President Bush to hold a rally on exactly this tax cut. I think it is 
really important to my State and to the country. I think it is 
important because it helps restore consumer confidence. It will get 
some funds, needed funds, back into people's pockets and it sets up tax 
reductions that people can make plans, financial plans on for the next 
10 years.
  Mr. Speaker, I feel privileged that I was able to participate in a 
very small sense with the President when he was running for the 
Presidency, and on the very day that he gave his tax cut talk. And I 
feel privileged also that I will be able to spend this coming Friday 
with the President when he returns to my home State to talk a little 
more about this tax cut.

                              {time}  2015

  Mr. Speaker, I want to talk a little bit about the need for a 
patients' bill of rights. If you will remember, Mr. Speaker, a number 
of years ago, there were a whole bunch of jokes and cartoons about 
HMOs. If you look through a magazine like The New Yorker today or other 
magazines or even watch some of the late night shows, you rarely see or 
hear HMO jokes anymore.
  I remember a few years ago when this joke was going around. There 
were many variations on it. You had three people who died and went up 
to heaven and they were waiting at the pearly gates. One was a nurse, 
one was a doctor and one was an HMO reviewer.
  St. Peter asked the nurse, ``Well, what did you do in order to gain 
access to heaven and pass the pearly gates?''
  She said, ``I took care of patients for 40 years. I counseled their 
families. I gave them all the loving care I could.''
  St. Peter said, ``Enter.''
  Then he asked the doctor, a neurosurgeon, ``What do you think you did 
to deserve entry into heaven?''
  She said, ``I got up in the middle of the night and I took care of 
some of the most horrific head injuries, frequently never got paid 
because many times those poor victims never had any insurance, but I 
didn't care because it

[[Page 9904]]

was my Hippocratic oath duty to take care of those people who were 
injured.''
  St. Peter said to her, ``Enter the pearly gates.''
  He asked the HMO manager, ``And what did you do to merit entry into 
heaven?''
  The HMO manager said, ``I managed to save the company millions and 
millions of dollars by denying care. So it really helped the 
stockholders.''
  St. Peter looked at that person for a little bit and said, ``Enter, 
but only for 3 days.''
  Now, that joke has had a lot of permutations, it is an old joke, 
probably most people have heard it, it is not even that funny anymore, 
because you knew the punch line.
  Remember when Helen Hunt in the movie As Good As It Gets appeared 
with Jack Nicholson? She was talking about her son who had asthma and 
how her son was being denied necessary medical care. Then she went into 
a long string of expletives about that HMO. And I saw something happen 
I had never seen before. My wife and I were at a theater in Des Moines 
and people actually stood up and applauded. I had never seen that 
before.
  Mr. Speaker, that movie today would not get the same response, 
because in order for something to be sort of funny or humorous, there 
has to be maybe a little bit of an element of surprise or a twist, 
something that catches you by surprise. Anymore, Mr. Speaker, it is 
hard to do a joke about HMOs because nothing is surprising anymore 
about the abuses or the denials of care that we continue to see year 
after year.
  Back then, Mr. Speaker, a few years ago, 4 years ago maybe, people 
were seeing headlines like this from the New York Post: ``HMO's Cruel 
Rules Leave Her Dying for the Doc She Needs.''
  Or here was a headline from a few years ago in the New York Post: 
``What His Parents Didn't Know About HMOs May Have Killed This Baby.''
  So this was all very topical as these stories of HMO abuses became 
known to the public. Time Magazine had a cover story on this. It was 
topical. It was the type of thing that you would see in The New Yorker 
in a cartoon, because this was somewhat new, it was new material, and 
there was something of a surprise. You could put a twist on it.
  I remember a few years ago when the story came out about an HMO 
requiring same-day discharge, the so-called drive-through deliveries. 
That surprised people. They thought, that is awful, that is outrageous. 
And so you saw a cartoon.
  Here is the maternity hospital. You have got the drive-through 
window, ``Now Only 6-Minute Stays for New Moms.'' The hospital employee 
saying, ``Congratulations. Would you like fries with that?'' And you 
have got a mother, her hair all frazzled with the crying baby as they 
are driving the car through. Kind of funny but also not so funny. Today 
this would not be as funny and you would not see this so much, because 
it is not new. Everyone knows this.
  Mr. Speaker, before I came to Congress, I was a reconstructive 
surgeon in Des Moines, Iowa. I took care of farmers who put their hands 
into machines. I took care of women who had breast cancer. I took care 
of a lot of children with cleft lips and palates and other craniofacial 
deformities that they were born with, like this baby here.
  Mr. Speaker, in the last few years, more than 50 percent of the 
surgeons who take care of congentital deformities like this have had 
cases denied by HMOs because these are, quote, cosmetic cases. I think 
that is awful. But also, Mr. Speaker, I would say anymore it almost 
does not shock anyone to hear this, because people have known about 
this now for years. People are also wondering why Congress has not 
dealt with this for years.
  This was a cartoon from a few years ago. Here we have a doctor in the 
operating room and we have the HMO bean counter next to him. The doctor 
says, ``Scalpel.'' The bean counter HMO member says, ``Pocket knife.'' 
The doctor says, ``Suture.'' The bean counter says, ``Band-Aid.'' The 
doctor says, ``Let's get him to intensive care.'' The HMO employee 
says, ``Call a cab.''
  Another cartoon from a few years ago. ``Your best option is 
cremation, $359 fully insured.'' And the patient is saying, ``This is 
one of those HMO gag rules, isn't it, doctor?''
  This was very topical a few years ago, because the news was that HMOs 
were telling doctors they could not tell a patient all of their 
treatment options without first getting an okay from them. In other 
words, I as a doctor could see a woman for a breast tumor, listen to 
her story, do an examination, but before I could sit down and tell her 
what her treatment options were, if I had a certain type of contract 
from an HMO, I would have to say, ``Excuse me,'' leave the room, get on 
the phone and ask the HMO if it was okay if I told that patient all of 
her treatment options. That is clearly wrong. It was clearly news. That 
news generated this type of response.
  A few years ago, we did a full debate here on the floor of Congress 
on the Norwood-Dingell-Ganske bill and actually brought to the floor 
this particular patient. A number of years ago, a young mother had 
about a 6-month-old son who was really sick in the middle of the night. 
He had a fever of about 104. Mom did what she was supposed to do. She 
phoned the HMO 1-800 number, got a reviewer on the phone, said, ``My 
baby is really sick and needs to go to the emergency room. What should 
I do?'' The reviewer said, well, take him to such and such a hospital. 
Now, Mom and Dad lived clear on the south side of Atlanta, Georgia. The 
reviewer told them the name of a hospital. The mother said, ``Well, 
where is it?'' The reviewer said, ``Well, I don't know. Find a map.'' 
It turned out that the hospital was clear on the other side of 
metropolitan Atlanta. So Mom and Dad, not being medical professionals, 
wrapped up little James in a blanket, got him in the car in the middle 
of the night and started out for the designated hospital. In the 
process, they passed several emergency rooms, but they were not health 
care professionals, they were just average people without a medical 
background. They did not know exactly how sick he was, but they were 
following orders because they knew that if they had stopped at an 
emergency room that was not authorized, then the HMO would not pay for 
the hospitalization. They would be stuck maybe with thousands of 
dollars of bills. So they moved on.
  Before they get there, the little baby had a cardiac arrest and 
stopped breathing. So imagine Dad driving frantically while Mom is 
trying to keep this little baby alive. They pull finally into the 
emergency room entrance. Mom leaps out of the car saying, ``Save my 
baby, save my baby,'' a nurse comes running out, they get the baby 
resuscitated, they start the IV lines, they start antibiotics and they 
manage to save this little baby's life.
  But because of that HMO's medical judgment over the telephone when 
they never examined the baby, they made a medical judgment. The 
judgment was that baby is well enough to go 50 miles. Instead of 
saying, ``Take that baby to the nearest emergency room,'' they said, in 
essence, ``Our judgment is, it's all right, you can take him a long 
ways.'' That was the medical judgment. That medical judgment by that 
HMO resulted in this. Yes, we saved James' life; but because of that 
cardiac arrest and the delay in treatment, he developed gangrene in 
both hands and both feet and both hands and both feet had to be 
amputated.
  This little boy is growing up to be a fine young man. He sat right in 
this chair right in front of me during the debate. He is able to pull 
on his leg prostheses, and he can walk okay. He needs help to get his 
bilateral hook prostheses on. Sometimes he uses them and sometimes he 
does not. But he will never be able to play basketball, he will never 
be able to touch the face of the woman he loves and marries with his 
hand. If he had a finger and you pricked it, he would bleed.
  This little boy is not an anecdote. I hear a lot of opponents to the 
Patients' Bill of Rights saying, ``Oh, you're just talking about 
anecdotes. We shouldn't legislate around here on the basis of 
anecdotes.'' Those anecdotes are real live people, if they survive the 
HMO care. And a funny thing is that under a

[[Page 9905]]

Federal law that was passed 25 years ago, in situations like this where 
the insurance is from the employer, that health plan, that HMO, is 
liable, this is under a Federal law, is liable for nothing other than 
the cost of care denied, or in this situation the cost of his 
amputations. I would ask you something. I mean, is that justice? Does 
that set up a proper incentive for the HMO not to cut corners but to 
provide the necessary treatment right from the beginning so that you 
prevent cutting the corners so tight?
  A judge reviewed this case. The judge said that this HMO's margin of 
safety was razor thin, quote-unquote. Razor thin. I would add to that 
as razor sharp as the scalpel that had to amputate little James' hands 
and his feet.
  And so as cases like this became known to the public, they continued 
to spawn cartoons. Some of the cartoons were what I would say black 
humor. Let me give you an example. Here is a medical reviewer. Maybe it 
was the medical reviewer who was a thousand miles away for that little 
boy who I just showed you. The medical reviewer saying, ``Cuddly care 
HMO. How can I help you?'' The next one is, ``You're at the emergency 
room and your husband needs approval for treatment? Gasping, writhing, 
eyes rolled back in his head? Doesn't sound all that serious to me. 
Clutching his throat? Turning purple. Uh-huh.''
  Down here. ``Well, have you tried an inhaler?'' The next one is, 
``He's dead?'' And the next one is, ``Well, then he certainly doesn't 
need treatment, does he?''
  And finally the last one in the corner says, ``People are always 
trying to rip us off.''

                              {time}  2030

  I guess this young lady must have been trying to rip off her HMO. She 
was hiking about 70 miles west of Washington, D.C., with her boyfriend. 
She fell off a 40-foot cliff. She had a fractured pelvis, a broken arm, 
a fractured skull. Luckily, her boyfriend had a cell phone.
  He pulled it out. They called an emergency number, got a helicopter 
to fly in. Here she is. She is strapped into a gurney about ready to be 
taken onto the helicopter. She is taken to the emergency room. She is 
treated in the intensive care unit for a month or so. She is 
semicomatose. She is certainly on significant doses of pain medicine.
  What does the HMO do? The HMO refuses to pay her bill. Why? Well, 
because she did not phone ahead for prior authorization.
  Now think about that for a minute. Was this lady supposed to be so 
clairvoyant that she knew she was going to fall off a 40-foot cliff so 
that she could phone ahead and let the HMO know? I do not think so, but 
that was their excuse for not paying her bill.
  So it is real life stories like that that would generate a cartoon 
like this. This is the HMO Claims Department. The reviewer is saying, 
no, we do not authorize that specialist; no, we do not cover that 
operation; no, we do not pay for that medication. Then apparently the 
reviewer hears something, shakes her head and then she says, no, we do 
not consider this assisted suicide.
  Well, as I said earlier, these are not just anecdotes. This is a 
family that was featured on the cover of Time Magazine a few years ago. 
This woman had breast cancer. Her physician recommended a certain type 
of treatment. So she went to a major, well-known medical center in the 
country and they were going to do it. They agreed, until they got a 
phone call from the HMO saying we do not think you should do that; that 
is very expensive treatment, and we will evaluate whether we continue 
our contract with your medical center.
  So she did not get all the information that she needed. She did not 
get her treatment and, at least according to what was thought to be 
appropriate medical care at that time, she did not get the appropriate 
medical care and she died. Today, her little boy and her daughter and 
her husband do not have this young mother. She did not have the type of 
appeals process to handle a denial of care that was very likely 
inappropriate, at least for that time.
  We want to do something about that. That is one of the reasons why we 
need to pass at the Federal level a patient bill of rights.
  Now I am going to go into some detail on the Ganske-Dingell bill here 
that will come up here in the House, and its companion bill, the 
McCain-Edwards bill in the Senate, but before I get into all the 
details and they get a little bit dry, I think it is important for me 
to do them, to share the details with my colleagues, if any are 
watching. I think it is also important just to briefly go over some of 
the major issues of contention.
  Number one, the opponents to our legislation say well, this will 
drive up health care costs. Now this is sort of an interesting 
criticism in light of the fact that in the last few years, the HMOs 
have increased their premiums very significantly, and it was not 
because of any patient bill of rights. It was because their 
shareholders said they needed more profit, and it was also because the 
cost of prescription drugs is going up a lot. We have seen premium 
increases, significant ones, in the last few years and it sure was not 
because of Congress passing a patient bill of rights. So do not believe 
all of that sky-is-falling stuff.
  What would the cost of our legislation be? The Congressional Budget 
Office scored our bill. It would cost a total of 4 percent over about 5 
years, and the major items of cost are not the liability at all, but 
the dispute resolution on internal and external review. In fact, the 
liability provision that would return responsibility to the health 
plans, fix something that Congress took away from the States 25 years 
ago, would cost a total of about .9 percent; that is .9 percent, less 
than 1 percent cumulative over 5 years. That amounts to the cost of 
about one Big Mac meal per month per employee.
  In fact, that has been very, very close to the cost of the patient 
protection bill in the State of Texas, which our bill is modeled after, 
and which President Bush, on many occasions during the campaign, 
bragged about as saying that that patient bill of rights down there in 
Texas has worked just fine, and it has. We wrote our bill based on 
that.
  So do not believe the exaggerated, hyperinflated, sky-is-falling 
claims on costs. Look at the HMO's claims with a bit of a jaundiced 
eye, particularly in light of what they have been doing with their 
premiums on their own, primarily for stockholder value.
  Another major issue is, well, if the health plans are liable where 
should that liability be? Because Congress basically 25 years ago said, 
you are not liable for any of your decisions other than the cost of 
care denied.
  Well, what we want to do is we want to build on a Supreme Court 
decision that basically says if it is a matter of medical judgment, 
then it goes to the State where it has been for several hundred years.
  As a physician, I am liable for any malpractice under State law. I 
believe that an HMO, which is making medical decisions, should have 
that same responsibility.
  Now there will be some who will say, no, let us have all of that 
liability on the Federal side of the ledger, not at the State level. My 
response to that is, well, number one, it is not a very Republican, and 
that is with a capital ``R'' idea. I always thought my party stood for 
States' rights and having responsibility closer to the people.
  Take somebody in certain parts of Iowa and require them to go to a 
Federal court, and a long trip has been added, and a lot of expense. 
The same thing would go for Michigan or Nevada or other places. There 
is also such a thing as the tenth amendment to the United States 
Constitution, and that says that unless the Constitution has 
specifically given a power to the Federal Government, then the power 
should reside at the State level.
  We have had that responsibility. It has traditionally been the 
responsibility of States to regulate insurance. In fact, we have even 
passed laws here in Congress like the McCarran-Ferguson Act to that 
extent, and we think that it should be that way also.
  If all that case law was moved to the Federal side, it would be a 
usurpation

[[Page 9906]]

and, I think, unconstitutional. It would also be something that the 
Federal judges are telling us do not do this. The Federal judges have 
seen some of these cases. They think that we should fix ERISA, the 
Federal law 25 years ago that took the jurisdiction from the States. 
They say move it back.
  So when we look at this issue of Federal-versus-State jurisdiction, 
we need to look at a few questions: whether the proposed legislation is 
within the core functions of the Federal system; whether the Federal 
courts have the capacity to take on new business without additional 
resources or restructuring and the extent to which proposed legislation 
is likely to affect the caseload in the Federal courts; whether the 
Federal courts have the capacity to perform their core functions and 
fulfill their mandate for ``just, speedy and inexpensive determination 
of actions.''
  I respect judges like Judge Pickering of Mississippi, the father of 
one of our colleagues, Congressman Pickering. What Judge Pickering says 
is get this to the State level. That is where it belongs when you are 
talking about medical judgments. If you are talking about benefit 
decisions, then that is fine, leave it at the Federal level under ERISA 
so the plans can devise their own benefit packages, so that plans do 
not have to follow individual State mandates. But if you are talking 
about medical judgment decisions, it should be at the State level.
  Here is what Judge Gorton in Turner versus Fallon Community Health 
Plan said in 1977:

       Even more disturbing to this court is the failure of 
     Congress to amend a statute, that due to the changing 
     realities of the modern health care system, has gone 
     conspicuously awry from its original intent.

  Here is what Judge Bennett said in Prudential Insurance versus 
National Park Medical Center:

       If Congress wants the American citizens to have access to 
     adequate health care, then Congress must accept its 
     responsibility to define the scope of ERISA preemption and to 
     enact legislation that will ensure every patient has access 
     to that care.

  Here is what Judge Garbis in Pomeroy versus Johns Hopkins said:

       The present system of utilization review now in effect for 
     most health care programs may warrant a reevaluation of ERISA 
     by Congress so that its central purpose of protecting 
     employees may be confirmed.

  Here is the 1999 proposed long-range plan for the Federal courts. 
This is something that Chief Justice Rehnquist has been involved with. 
It says Congress should commit itself to conserving the Federal courts 
as a distinctive judicial forum of limited jurisdiction in our system 
of Federalism. Civil and criminal jurisdiction should be assigned to 
the Federal courts only to further clearly define and justify national 
interests, leaving to the State courts the responsibility for 
adjudicating all other matters.
  In other words, do not give us an area of law that has traditionally, 
for 200-plus years, been at the State level.
  In 1998, the year-end report of the Federal judiciary, Justice 
Rehnquist says this:

       This principle was enunciated by Abraham Lincoln in the 
     19th century and Dwight Eisenhower in the 20th century. 
     Matters that can be handled adequately by the State should be 
     left to them. Matters that cannot be so handled should be 
     undertaken by the Federal Government.

  Why do the Federal judges not want this jurisdiction? Number one, it 
has never been in the Federal courts. It has always been in the States.
  Number two, practically speaking, they do not think they can handle 
this. If one wants a speedy adjudication and a speedy determination to 
resolve a dispute, do not go to the Federal courts, believe me, 
particularly if they would like to avoid costly litigation, because it 
is lengthy and costly in the Federal courts and anyone who proposes 
moving all of this to the Federal courts is ignoring a fact in this 
country.

                              {time}  2045

  In the Federal courts, by the Speedy Trial Act of 1974 the Federal 
courts have to give priority to criminal cases. The criminal case 
filings were up 15 percent in 1998. This means that all of those drug 
cases that the Federal judges are charged to adjudicate come before 
anyone who has a problem on a civil case related to health care.
  This was the situation in the Federal courts just a few years ago: 
they had 65 vacancies, 22 emergencies, 16 anticipated. It is more than 
that. We are going to have a big debate in the Senate about the 
appointment of Federal judges. But everyone agrees that the Federal 
bench is significantly understaffed, so the last thing that they need 
is for us to do something unconstitutional and move something that 
should reside at the State level. All of that.
  I mean, are we in Congress going to rewrite all the statutes, the 
evidentiary rules on State tort and move it into the Federal courts? I 
know an awful lot of conservative Republican Congressmen who should 
have a lot of heartburn with that, because they know what certain 
Federal court jurisdictions which have been very liberal might do with 
this type of jurisdiction. It all goes to show, you had better be very, 
very careful what you ask for.
  Mr. Speaker, in the remaining time that I have, I want to talk just a 
little bit about the bill itself, the Ganske-Dingell bill in the House, 
the McCain-Edwards bill in the Senate. This is not the same bill that 
we voted on in 1999. We made a good faith effort to come to some 
significant compromises with our opponents on this legislation. We 
used, for instance, exact language or modified language from a number 
of bills, including the opponents', the opposition bills, to try to 
meld a compromise on this piece of legislation.
  There are some significant differences which I want to get into in 
some detail between the Ganske-Dingell bill and the Norwood-Dingell-
Ganske bill that passed in 1999, but we still think this is a strong 
bill and a necessary bill.
  With utilization review, we use language from the Norwood-Dingell 
bill. For prior authorization, we establish basic standards and time 
frames for the initial review of claims for benefits. We say that prior 
authorization determination should be made in a timely fashion 
according to the medical facts of the case. For normal cases, an 
insurer should respond within 14 days from the date the plan receives 
the information, but in no case later than 28 days. If an insurer 
requests information from a patient-provider, they have 5 days from the 
request to submit such information.
  The bill ensures that requests for care are handled quickly. In 
instances where the insurer and the doctor disagree about a patient's 
treatment, the insurer must disclose the reason for the decision and 
inform the patient of the right to appeal that decision. You know what, 
Mr. Speaker? That language is adopted from the Nickles amendment in the 
Senate.
  We then have a section on internal appeals, so that if a patient's 
doctor recommends a type of treatment, but then the health plan, the 
HMO, says, no, you have a certain procedure to go through in the plan 
to get a hearing, some due process. We used the language from the 
Nickles amendment there. This was a Republican Senator's amendment.
  On external appeals, let us say that a patient is denied treatment 
they think is necessary and their doctor thinks is necessary. They go 
through an internal appeals process. The plan still continues to deny 
the care. Then we set up a way for the patient to go outside of the 
health plan to get an external review, an external appeal. We looked 
through all of the language, and we basically use language for our 
section 104 language that was adopted from the Nickles amendment.
  In the access to care section, we say that the bill provides the 
right for individuals to elect a point of service option guaranteeing 
access to any doctor, regardless of whether or not that doctor is in 
the plan's network. But we say also that the patient would be 
responsible for the additional cost of that provision. In that instance 
we use language from the Norwood-Dingell bill.
  But then we talk about emergency care. We say that the bill gives 
patients the right to go to the closest emergency room for an emergency 
room. Like that little boy. If this bill had been law, then those 
parents would

[[Page 9907]]

not have needed to phone that 1-800 number. If they had, they could 
have still known that instead of going so far, they could have just 
taken that sick little baby directly to an emergency room. For our 
bill, the Ganske-Dingell bill, we used language from the Goss-Coburn-
Shadegg substitute that was debated on this floor.
  We have a provision in there for access to specialty care, so that 
people can get access, can go to the appropriate specialist. We use 
language adopted from the Nickles amendment. We have a provision in 
this bill for access to obstetrical-gynecologic care and pediatric 
care, and we used language adopted from the Nickles amendment for that.
  We have a provision on continuity of care. The bill would allow a 
patient who has an ongoing and serious medical problem to continue to 
see their provider, their doctor, for up to 90 days, in the event that 
that doctor is no longer with that health plan. We have specific 
protections for individuals who are pregnant or terminally ill or are 
scheduled to have surgery, and we use language adopted from the Nickles 
substitute for that.
  We have access to non-formulary drugs. The bill provides a provision 
to allow doctors to prescribe a drug that is not on the health plan's, 
the HMO's formulary, when a non-formulary drug is medically necessary. 
That protection is very important for a lot of individuals who may have 
allergies to certain types of medications, who have tried the HMO's 
formulary drug, but have not had success; and we used language adopted 
from the Nickles amendment for that.
  We have a provision that would allow access to clinical trials, so 
that patients would have greater access to certain clinical trials, 
patients with Parkinson's disease, Alzheimer's, cancer and other 
serious diseases that are life-threatening and for which no standard 
treatment is effective. Some in the consumer groups would like to see 
that provision expanded and made more broad, but we used language from 
the Norwood-Dingell bill for that.
  We have a provision in the bill for women's health and for cancer 
protection, important provisions relating to women's health, that 
guarantee the women the right to have a doctor decide the appropriate 
length of stay, for a woman who has a mastectomy, for instance. 
Remember when the HMOs were saying gee, you can have your breasts 
removed as an outpatient? Well, I have done a lot of breast surgery, 
and I will tell you what, it is the rare patient that could tolerate 
that as an outpatient. Furthermore, it would be the very rare patient 
where I think that that would be safe. So we used language adopted from 
the Nickles amendment for that provision.
  In fact, at least 50 percent of the language in our compromise bill 
is language from the Nickles amendment, the Republican Senate 
substitute that was debated 2 years ago. The same thing goes for access 
to information, information disclosure, language adopted from the 
Nickles amendment.
  Now, one thing that we did keep from our bill was we have language to 
ensure that doctors are free to discuss all treatment options with 
their patients, and we used the language from the Norwood-Dingell-
Ganske bill for that.
  We have language that protects health care professionals from 
discrimination based on their license. We used language from the 
Nickles amendment.
  We can go through a whole bunch of further issues, but I think it is 
important to talk about the liability provisions in the Ganske-Dingell 
bill and to share this, because there will be a lot of debate about 
this issue when this comes to the floor. This will come to the floor in 
the Senate either this week or next week, and I think it will probably 
come to the floor here in the House pretty soon thereafter.
  Title III in the Ganske-Dingell bill applies standards to the 
Employee Income Retirement Security Act, ERISA. For self-insured health 
plans regulated by the Department of Labor, our bill would be both a 
floor and a ceiling. Let me explain that.
  As under current law, States cannot place further regulations on 
ERISA-based health plans. A key attribute of ERISA is that it provides 
for a uniform set of rules for health benefit plans operating across 
several States. We think it should stay that way. Yet under current 
law, practicing health care professionals are subject to the varying 
laws of each specific state.
  The new provisions of our bill strike a solid compromise, recognizing 
that employers should expect uniform rules for administrative 
processes, but that any ``medically reviewable decisions'' would be 
subject to State law, just as doctors are.
  This new bifurcated Federal-State structure is a significant 
modification from the purely State cause of action that was in the 
original Norwood-Dingell-Ganske bill.
  The original language did not change the current law remedy in 
section 502 of ERISA, but rather simply clarified that State causes of 
action were not preempted. The business and insurance community voiced 
concerns that this approach would inhibit their ability to administer a 
multi-State employee health benefit plan. By leaving suits involving 
benefit administration decisions in Federal court under section 502 in 
our current version in the Ganske-Dingell bill, employers and insurers 
will have relative uniformity for administering their health plans 
across State lines.
  The first piece of the bill liability package adds to the existing 
Federal remedy under ERISA section 502. ERISA section 502 is amended to 
provide a cause of action in Federal court for a patient who has been 
injured or killed by a negligent denial of a claim for benefits that 
does not involve a medically reviewable decision.
  Under this new Federal cause of action, a plaintiff may seek both 
economic and non-economic damages. By excluding medically reviewable 
decisions from the Federal remedy, group health plans will only be 
subject to liability under section 502 for benefit administration 
decisions that cause harm or death. Those include decisions such as 
whether an employee is eligible for coverage, whether a benefit is part 
of the plan or other purely administrative contractual decisions.
  Punitive damages are not allowed under the Federal cause of action. A 
civil assessment may be awarded upon showing clear and convincing 
evidence that the plan acted in bad faith and with flagrant disregard. 
Those are high standards.
  This standard carries a high burden of proof and is consistent with 
State statutes. This standard ensures that a health plan will not be 
subject to these damages for simply making a wrong decision. A plan 
must show flagrant disregard for the health and safety of others. 
Before exercising that legal remedy, the patient has to exhaust both 
internal and external appeals processes. If the patient suffers 
irreparable harm or death prior to the completion of the review 
process, the patient or heirs of the plan can elect to continue the 
review process and the court can consider the outcome. That is from 
language adopted from the Goss-Coburn-Shadegg substitute that was 
debated on this floor 2 years ago and which received a lot of support 
from the Republican Members.
  The second piece of the bill liability package amends ERISA section 
514 to allow causes of action in State court for a denial of a claim 
for benefits involving a medically reviewable decision that causes harm 
or death to a patient.

                              {time}  2100

  Punitive damages are prohibited in cases where the plan properly 
followed the requirements of the appeal processes and followed the 
determination of an external review. However, as in the Federal cause 
of action, punitive damages are available in cases where there is a 
clear and convincing evidence that the plan exhibited a willful or 
wanton disregard for the rights and safety of others.
  I want to ask my colleagues something: Do we want to vote for a bill 
that says if a plan exhibits willful or wanton disregard for the safety 
or rights of others that they should not have any responsibility? I 
mean, do any of my colleagues want to bring a

[[Page 9908]]

bill to the floor that would say that if a tire explodes and people are 
killed and that company that made that tire showed a willful and wanton 
disregard for the safety of the purchaser, that they should not be 
liable? Well, I do not know about my colleagues, but I sure do not want 
to go home and campaign with that on my record.
  In our bill, before exercising this legal remedy, the patient has to 
exhaust both internal and external appeals. But if the patient suffers 
irreparable harm or death prior to the completion of the review 
process, either the patient or heirs or the plan can elect to continue 
the review process and the court can consider the outcome. But we do 
not want to pass a law that says that a plan can slow-walk an appeals 
process, delay treatment, make this thing go on and on, and then have 
the patient die in the meantime, and then be liable for nothing; at 
least I do not want to.
  Now, the Norwood-Dingell bill removed the ERISA section 514 
preemption of State law for all torts and allowed injured patients to 
bring a cause of action in State court for injuries caused by a medical 
decision or an administrative decision. Our new bill is different. Our 
new bill says, and it is a significant compromise, it limits the scope 
of actions that can be filed in State court to only those involving 
medically-reviewable decisions. That is a major compromise. We made 
this step towards the opponents to our bill.
  This bifurcation of the remedy into a State component and a Federal 
component holds to the principles underlying ERISA. The existing 
Federal cause of action under ERISA affords health plans a set of 
uniform standards for making administrative decisions. That is what 
ERISA was intended to do. That is why it was originally designed to be 
a bill for the benefit of employees, not employers. However, when a 
health plan makes a decision that involves medical judgment, that plan, 
in my opinion, should be subject to the State laws, and recent Supreme 
Court decisions and the 5th Circuit decision upholding the Texas health 
plan liability would allow for the continued development of State laws.
  Mr. Speaker, I will summarize here. There are a number of States that 
have passed health plan liability laws: Arizona, California, Georgia, 
Louisiana, Maine, Oklahoma, Tennessee, Texas, Washington. The Ganske-
Dingell bill, the McCain-Edwards bill recognizes that. The bills that 
would move all liability into Federal courts would preempt those 
States. We provide a floor; they preempt.
  Finally, let me just say a word about the employer protections, 
because we have a significant compromise in this bill from the last 
time around. The last time around we said an employer could be liable 
if they exercise discretion or authority; and the business community 
said, we think that that standard is a little loose, so we changed it. 
We use now a standard that was proposed by opponents to our bill last 
time that says, only if we directly participate can one be held liable.
  Mr. Speaker, there are very few that do that. We have a big bill 
coming up for debate. I hope my friends and colleagues will look at 
this bill in detail.

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