Patient Bill of Rights 2001

Building on last year's efforts by the 106th Congress, which saw the Norwood-Dingell bill pass the House of Representatives but get stalled in the Senate, Senators John McCain (R-AZ) and Edward Kennedy (D-MA), joined a bipartisan group from both houses of Congress to introduce the Bipartisan Patient Protection Act of 2001. [1] This Act represents the latest attempt in Congress to address concerns about managed care problems that effect quality and access to care for individuals with private health insurance. The current proposal represents a growing consensus around a central set of issues. It also represents a compromise position on tort reform that many in Congress can accept, but is in conflict with the position of the new administration.

Prior legislation passed the House of Representatives last year but was stopped in the Senate by a filibuster over the tort reform issue. In addition, last year's Senate proposal was significantly different from that in the House. It remains to be seen what the final outcome of this debate will be.

Protecting states' rights

A central component of the Patient Protection Act is to preserve the right of states to maintain or develop their own strong patient protections. This has been an important issue for states since many already have laws that address patient protections and some have indicated they intend to do so. In some cases, they are more stringent than laws that could be passed on a national level and the states would prefer that their laws be preserved. The Patient Protection Act of 2001 allows each Governor to evaluate and certify that their laws meet or exceed the federal standard. The state would then petition the Secretary of the U.S. Department of Health and Human Services to evaluate their request. The Secretary has 90 days to approve or reject the petition.

Tort reform

The Employee Retirement Income Security Act (ERISA) exempts self-insured plans from state regulation since they are regulated by federal law. Under ERISA, patients' ability to sue their managed care provider is limited by federal law. While an individual can sue their health plan under ERISA, recovery is limited to the denied benefit. Many advocates and legislators believe that individuals should be able to sue all health plans, including those covered under ERISA, for damages as well, especially when death or injury has occurred.

The debate has been over the degree to which this will be allowed, whether state or federal caps for damages should prevail, and whether employers that self-insure would be at risk for lawsuits. The Patient Protection Act allows individuals to sue their health plan while limiting damages and prohibiting the individual from suing the employer, unless the it was directly involved in making a medical decision. This was a major sticking point in prior debate and is an important compromise designed to get the support of the business community.

The proposal provides a federal cause of action for negligent plan administration that results in injury or death. It also caps the damages for cases tried in federal court at $5 million and bans punitive and exemplary damages at the federal level. The Act attempts to address employer concerns for a national standard for contract interpretations. The proposal does allow suits at the state level for medical decisions that result in injury or death. The states' limit on damages would be honored for medical malpractice suits. Thirty-three states have limits on damage awards.

The Act defines a uniform process for handling disputes. Disputes would first go through an internal and, if necessary, an external appeal process for adverse claim decisions before they go to court. It sets timeframes and criteria for these reviews and requires the external appeals to be done by independent experts using current scientific knowledge. The decision of the external reviewer would be binding on the health plan.

Ensuring access to care

Ensuring access to needed providers and special care is an important component of the bill. Providing direct access to obstetricians/gynecologists, specialists, and pediatricians should ensure direct access to providers that historically have a clearly defined role in delivering care to a particular population. By providing access to clinical trials and non-formulary drugs, patients have access to cutting-edge technologies and therapies. The proposal also attempts to ensure continuity of care for those with chronic medical conditions.

Gate keeping is the cornerstone of managed care, however, ensuring timely access to emergency care continues to be a challenge since many serious conditions often present clinically the same as urgent or non-urgent conditions. The "prudent layperson" standard for patients presenting to hospital emergency departments without prior authorization has been proposed to address this concern. This standard, which is in place in several states, permits a patient to seek emergency care without a referral for signs and symptoms that a "prudent layperson" would perceive as an emergency--for example, a 45-year-old with exertional abdominal or chest pain, a hand laceration from a sharp knife, or acute onset of shortness of breath.

The proposal enhances patient access to information by prohibiting managed care plans from keeping physicians from telling patients about all of their options for care. The so-called gag clause has been cited by some as a technique used by managed care companies to limit access to care. A 1997 Government Accounting Office (GAO) study, however, failed to identify any managed care company that had an explicit "gag" policy prohibiting physicians from giving their patients all of their clinical options. The GAO did find contract provisions in some managed care plans that gave financial incentives to physicians, which many people believe encourages physicians to limit care. [2]

A different view

A recent survey by the Henry J. Kaiser Family Foundation showed that "71 percent of Republicans and 81 percent of Democrats favored patients' rights legislation that includes the right to sue their health plan." [3] Support drops to around 30 percent for both groups if the right to sue results in insurance companies refusing to offer health coverage. But only ten lawsuits have been filed since the 1997 Texas law went into effect, which argues against these laws increasing legal action. [4]

President Bush announced at a recent convention of cardiologists that he supports a more limited right to sue and would prefer to have all suits occur in federal court instead of state court. He laid out a series of five principles that are important in any patient protection legislation:

1. Everyone must be covered.

2. Important rights include: the right to get emergency treatment; the right to see a specialist; direct access to obstetricians/gynecologists and pediatricians; and access to clinical trials when standard treatment is not effective.

3. The right to a fair and immediate binding review of claim decisions.

4. A meaningful review for patients that have been harmed.

5. Affordable health coverage that is not increased by frivolous litigation. [5]

These principles are being put in legislation sponsored by Senators Bill Frist (R-TN), John Breaux (D-LA), and James Jeffords (R-VT). Their proposal requires that all suits be tried in federal court. It would also allow states to opt out of any patient protection if they: could prove that these protections already exist, have a low HMO enrollment, or would increase health premiums by 2 percent or more. The bill would not allow any punitive damages and would cap non-economic damages at $500,000.

Conclusion

Ensuring patients access to needed health services remains a top priority of Congress this year. A legislated "patient bill of rights" is likely to occur if Congress can resolve their differences with the Administration on tort reform. This would benefit more than 161 million Americans with private health coverage.

Georges Benjamin, MD, FACP, is the Secretary of the Department of Health and Mental Hygiene in Baltimore, Maryland.

Note

The stated views are those of the author and do not represent those of the State of Maryland or the Department of Health and Mental Hygiene.

References

(1.) www.senate.gov/[sim]mccain/pborsum.htm

(2.) "Managed Care; Explicit Gag clauses Not Found in HMO Contracts, But Physician Concerns Remain," GAO/HEHS-97-175, August 1997.

(3.) Post Election Survey Finds Health Issues Rank High for voters, But Consensus on Solution will be Hard to Reach, News Release: The Henry J. Kaiser Family Foundation, January 25, 2001.

(4.) Members Unveil Patients' Bill of Rights With Federal Limits on court Damages, Daily Report for Executives, Bureau of National Affairs, Regulation, Law & Economics, Health Care, No. 26, February 7, 2001.

(5.) President George W. Bush, Speech to the American College of Cardiology, March 21, 2001.

KEY CONCEPTS

* Tort Reform

* Prudent Layperson Standard for Emergency Care

* Managed Care (HMO) Reform

* Bipartisan Patient Protection Act of 2001

* Employee Retirement Income Security Act (ERISA)

* External and Internal Appeals Process

Breaking gridlock on managed care reform, a bipartisan coalition in Congress introduced the newest version of a patient bill of rights. Unlike last year's ill-fated Norwood-Dingell bill, the Bipartisan Patient Protection Act of 2001 has strong bipartisan support; concern remains, however, on the provisions that allow patients to sue their managed care plan. The debate now focuses on the type of liability reform that Congress and the White House can agree on. If they are able to agree, a patient bill of rights may soon become law.

Bipartisan Patient Protection Act of 2001

Clinical Access

* Direct Access to Specialists

* Access to Pediatricians & Ob/Gyn

* Access to Emergency Care

* Access to Non-formulary Drugs

* Continuity of Care Guarantees

* Access to Clinical Trials

Information

* Access to Plan Information

* Prohibits Gag Rules

Appeals and Grievance Process

* Timely Internal Review

* Timely and Binding Expert External Review

Accountability

* Federal Right of Action

* Provides Caps on Civil Monetary Penalties

* Prohibits Punitive Damages in Most Situations

* Preserves State's Rights when Equal or Greater than Federal Law

Employer Protections

* Defines Legal Protections for Employers

* Maintains National Uniformity for Plan Administration and Benefits

COPYRIGHT 2001 American College of Physician Executives
COPYRIGHT 2002 Gale Group