Bills to regulate managed care gain support

Democrats and Republicans battle over patient protection legislation.

By Lisa Rabasca
Monitor staff

Embroiled in election-year politics, Democrats and Republicans are bickering over legislation that would protect consumers enrolled in managed-care plans. The two parties? lack of agreement makes it unlikely that Congress will enact any meaningful patient protection measures this year, according to APA?s Practice Directorate staff.

'It had been my belief that if we didn?t get legislation enacted by early June, our hope for bipartisan legislation would give way to partisan politics,' says Russ Newman, PhD, JD, APA?s executive director for professional practice. As elections draw near, Newman says, Congress is using managed-care reform as a political football.

Despite the congressional scrimmage, Newman says, APA is advocating for legislation that would provide genuine patient protections by:

? Amending the 1974 Employee Retirement Income Security Act (ERISA) to allow patients in ERISA-regulated plans to sue their managed-care company for inappropriate denial of treatment or inadequate care.

?Allowing enrollees to receive care outside the managed-care company?s network of providers.

? Prohibiting managed health plans from discriminating against providers based solely on their state licensure or certification?a move that would allow enrollees to access a full range of provider services.

APA supports two bills?the Patient Access to Responsible Care Act (PARCA), introduced by Rep. Charlie Norwood (R?Ga.) and Sen. Alfonse D?Amato (R?N.Y.), and the Patients? Bill of Rights, introduced by Senate Minority Leader Tom Daschle (D?S.D.) and Rep. John D. Dingell (D?Mich.).

Battle lines are drawn

There is, however, another Republican proposal circulating on Capitol Hill, which was approved by the House on July 24, setting the stage for Senate action on a different version of the bill. The vote in the House was 216 in favor, 210 against the legislation, almost entirely along party lines with only three Democrats voting in favor of the proposal.

Norwood dropped his support for PARCA when the Republican leadership unveiled its own proposal for managed-care reform. As a member of the task force that drafted the proposal, Norwood was put in a difficult political position, says Doug Walter, legislative counsel on the APA Practice Directorate government relations staff. Had Norwood battled the House leadership by publicly supporting PARCA over the leadership proposal, he likely would have jeopardized any future chances of promoting his legislative agenda in a Republican-controlled Congress, Walter says.

This Republican proposal, drafted by a task force appointed by House Speaker Newt Gingrich (R?Ga.), more clearly defined the differences between the Democrats and Republicans, and eviscerated any bipartisan agreement that is needed for reform, Newman says.

To begin with, the Republican leadership bill?known as the Patient Protection Act?denies patients the right to sue ERISA-regulated managed-care companies for negligent care. Instead, according to the proposal, if a managed-care organization denies treatment that has been approved by physicians serving on an external review board, the company could be assessed a penalty of $500 per day for each day the patient is denied service. However, companies would not be bound to the external review board?s decision.

The proposal also includes other limits on patient protections. For example, it calls for capping the amount of money patients can win in those malpractice suits that can currently be brought, and includes vague language on medical-record confidentiality that would pre-empt stronger mental health privacy laws in some states. The bill also includes language that would actually expand the number of consumers in unregulated ERISA plans by allowing small businesses and self-employed people to join together to purchase health insurance under the ERISA shield.

However, the Republican proposal does include some of the same provisions as PARCA and the Democrats? bill. For example, the Republican proposal would ban so-called 'gag rules' that forbid providers from telling patients about expensive treatment options their health plan doesn?t cover and require health plans to reimburse patients for emergency care that a 'prudent layperson' would deem necessary.

The White House has threatened to veto the proposal. However, with the House and Senate voting on different versions of the bill, legislators will need to negotiate the final bill in September, says Peter Newbould, APA?s director of congressional affairs.

Political protection

Because the Republican leadership bill includes several controversial provisions that are likely to stymie its passage?including the cap on medical malpractice damage awards, expansion of medical savings accounts, and vague language on medical-record confidentially?many see the Republican proposal as an empty shell designed to protect incumbents during an election year, Newbould says. The Republicans know they need to show voters they are concerned about patient protections by passing a managed-care reform bill before the November elections, he says.

However, he adds, while the Republican bill adopted much of PARCA?s language, it offers few patient protections. For example, one of the bill?s provision?s would pre-empt stronger mental health privacy laws in some states?thus enabling managed-care companies easier access to patients? records and eliminating restrictions on how managed-care companies could use the records, Walter says. Language for the confidentiality provision was taken from a controversial bill introduced several times by Sen. Robert Bennett (R?Utah).

Inserting language from a failed bill is another example of Republicans playing election-year politics, Newman says. 'The language has been around for years, it didn?t have support, and all of a sudden it gets stuck into a patient protection act,' he says. The House bill contains other contentious provisions, Newbould says, including language that would prevent psychologists from being part of the internal and external review process that would review managed-care treatment decisions.

'Psychologists are highly trained in the diagnosis of mental disorders,' he says, 'and we should not have practitioners superceded by a new requirement that physicians make a determination for their services.'

A push for patient rights

Meanwhile, Democrats are trying to get Congress to act on their bill, the Patients Bill of Rights, also known as the Daschle-Dingell bill. The proposal shares many of PARCA?s basic protections. The Daschle-Dingell bill would protect providers? communication with patients and enable emergency care under the prudent layperson standard. The bill would also give consumers the right to sue their managed-care plans if a company?s decision not to treat harmed a patient. And the bill calls for establishing state offices that could help consumers choose health plans and understand their rights.

Daschle tried several times to offer the Patients? Bill of Rights as an amendment to unrelated legislation, including the appropriations bill for the U.S. Department of Veterans Affairs. Daschle?s attempts were met with opposition from Majority Leader Trent Lott (R?Miss.), who pulled legislation from the floor before the amendment could be debated.