Friday | August 3, 2001

House OKs patients' rights bill
Plan must be reconciled with Senate measure

By Christopher Lee / The Dallas Morning News

WASHINGTON – The House voted late Thursday to grant patients new powers in dealing with their HMOs, including the right to sue managed care companies and guaranteed access to specialists and emergency care.

But the legislation – approved 226-203 on a largely party-line vote – must survive potentially difficult House-Senate negotiations, then be signed by President Bush, before it becomes law.

The bill the House approved represents a compromise struck this week by Mr. Bush and Rep. Charles Norwood, R-Ga., a key House sponsor of the bill, to avoid a threatened presidential veto. The deal would limit how much money patients could win in lawsuits against insurers and set rules on how those cases could be tried.

"Like it or not, we have to work with this president, who has to sign this bill," said Dr. Norwood, a dentist who has led the effort to pass a patients' rights bill for several years. He said the compromise would offer patients adequate protections and legal recourse against HMOs that misbehave.

But Democrats and Dr. Norwood's original co-sponsors were harshly critical, saying the revised bill would do more for health maintenance organizations than for patients. Opponents also contended that it would strip patients of tough protections in existing state laws, such as a 1997 Texas measure that Mr. Bush at first opposed and later allowed to become law without his signature.

"The entire Texas law is being ripped up and thrown out the window," said Rep. Martin Frost, D-Dallas, chairman of the House Democratic Caucus.

He said the compromise "creates a convoluted process that may very well prevent patients in Texas or any other state from ever holding an HMO accountable in state court."

Rep. Kevin Brady, R-The Woodlands, a former state representative, said the compromise would indeed pre-empt state law – but so would the original bill.

"You are choosing between two bills that both pre-empt," Mr. Brady said. "Truth be told, both these measures are nearly identical twins. It's frustrating that every lawyer in Washington has a wildly different opinion of what works best with our Texas law. Given a choice between who is looking out more for Texas – President Bush or some congressman from Iowa – I choose the president."

The House bill, like the version the Senate passed in June, would guarantee patients the right to emergency care, access to specialists, minimum hospital stays for mastectomies and access to government-run clinical trials.

Patients could sue their HMOs only after exhausting an external review process. They could win no more than $1.5 million in damages for pain and suffering, and no more than $1.5 million in punitive damages – and that only if the HMO did not abide by an independent reviewer's finding.

Federal rules would apply to lawsuits in state courts, a move opponents say would protect HMOs by making it harder for patients to prove wrongdoing.

The Texas law allows patients to sue HMOs in state court for providing poor quality care. There are no limits on damages for lost wages or pain and suffering. Punitive damages, designed to punish HMOs for decisions that harm patients, are limited to $750,000 plus twice whatever is awarded for lost wages and other economic harm.

White House officials said that the amended House bill will create uniform legal standards for HMOs or businesses that operate in more than one state. The approach also gives options to patients in states where there is no legislation. Administration officials said that only 10 states allow lawsuits against HMOs.

The original bill, sponsored by Rep. Greg Ganske, R-Iowa, and Rep. John Dingell, D-Mich., matched Senate-passed legislation that allowed for higher damages and less restrictive rules in state court lawsuits. But House Republican leaders pushed through an amendment earlier Thursday to change the bill to reflect the Bush-Norwood compromise.

Employers would not be subject to suits unless they ran their health insurance plans and were directly involved in the decision to deny a patient's medical claims. And employers, such as Wal-Mart, that administer and finance their employee health plans themselves could only be sued in federal court.

Mr. Ganske said he opposed the compromise measure in part because it offers HMOs protections against lawsuits that doctors and hospitals would not enjoy.

"His amendment would allow HMOs to be treated better than others," said Dr. Ganske, a plastic surgeon.

Critics said the House bill would also tip the balance of power toward HMOs by denying patients the strong hand in court that is necessary to back up the new rights to care the legislation grants them.

"If it becomes law, the American people are at the mercy of the insurance companies with almost no recourse at all," said Rep. Marion Berry, D-Ark., a chief sponsor of Dr. Norwood's original bill. "There is absolutely no question who is getting taken care of. The insurance companies should have a smile on their face that would be the equivalent of the grille on a '52 Buick."

But Mr. Bush and Republican leaders argued that the compromise was even-handed and would protect patients without driving up health insurance premiums.

"Some of us have been working on this issue for 10 years," said House Speaker Dennis Hastert, R-Ill. "It's time to get this done."

Mr. Bush and Vice President Dick Cheney met with Republican House and Senate members for a half-hour Thursday to congratulate them on their legislative successes and thank them for their work on patients' rights and other issues.

Rep. Pete Sessions, R-Dallas, and other Republicans argued that it was important to pass a bill that Mr. Bush would sign and that would not lead to waves of lawsuits that would drive up insurance premiums and prompt employers to drop health coverage, as the contend the Senate bill would do.

"You can't pass a bill that is going to drive millions of people into the ranks of the uninsured," Mr. Sessions said. "Charlie Norwood sat down and worked out an agreement that everyone seems to like except for the most liberal Texas Democrats."

The patients' rights issue has proved a tough one for Mr. Bush and House Republicans. Polls show Americans have long been unhappy with their HMOs and support legislation granting them new rights in their dealings with insurers.

Although the Senate measure won bipartisan support, Mr. Bush had threatened a veto. House Republicans had hoped to bring up another bill that offered more limited avenues for lawsuits, including a $500,000 cap on damages.

But several moderate Republicans had pledged to back Dr. Norwood's original bill, forcing GOP leaders to delay a vote and leaving the fate of their plan in doubt.

"They've been on the defensive ever since, trying to figure out how they can turn this issue around," said Norman Ornstein, a scholar at the American Enterprise Institute, a Washington research group.

The Bush-Norwood compromise turned the tables, leaving most Democrats and a few Republican moderates searching for ways to save their bill and allowing Mr. Bush to take charge of the issue.

"At minimum, he's moved beyond ... erasing the notion that he's against something most Americans are for," said Mr. Ornstein, who said House passage of the compromise "means party at the White House."

Senate leaders on patients' rights legislation made it clear Thursday that the House vote will not be the final word on the matter. They said they would fight to change the bill when lawmakers from the House and Senate sit down to work out the differences in their bills.

"The more we see of President Bush's proposal, the less we like it," said Sen. John Edwards, D-N.C., chief sponsor of the Senate version, along with Sen. Edward Kennedy, D-Mass., and Sen. John McCain, R-Ariz. "It is slanted at every turn in favor of the HMOs and against patients. ... It would not pass the Senate."

If Senate and House lawmakers cannot reach an agreement, supporters of the Senate version may try to attach their measure to a different bill in the Senate and pass it that way, Mr. Kennedy said.

"This issue is not going to go away," he said. "They may have a temporary victory this afternoon, but it is not going away."

Staff writers David Jackson and Emily Ramshaw contributed to this report

Related Articles:
("A fast track means to resolving disputes", Austin American-Statesman, July 25, 2001)
"No Flood of HMO Suits in Texas", Houston Chronicle, July 25, 2001)
("The healthcare disaster that wasn't",, July 17, 2001)