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CNN Burden of Proof

Lawmakers Agree on Need for Patients' Bill of Rights, yet Not on Right to Sue

Aired July 02, 2001 - 12:30   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(BEGIN VIDEO CLIP)

ARI FLEISCHER, WHITE HOUSE PRESS SECRETARY: The president's principles remain unchanged, and the president is ready, willing and able to sign a patients' bill of rights into law that protects patients in their dealings with HMOs, and he believes that can be done -- and should be done -- without driving up the cost of health care by turning our health care system over to the trial lawyers.

(END VIDEO CLIP)

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SEN. TOM DASCHELE (D), SOUTH DAKOTA: I'm prepared for a fight, but I hope we don't have one. I don't think that it's necessary to have a fight; we're almost there. I would hope that the president would sign it or perhaps allow the bill to become law without his signature.

(END VIDEO CLIP)

ROGER COSSACK, CO-HOST: today on BURDEN OF PROOF, the patients' bill of rights are your bill of rights. Whose version of those rights do you benefit from the most?

ANNOUNCER: This is BURDEN OF PROOF, with Roger Cossack and Greta Van Susteren.

COSSACK: Hello, and welcome to BURDEN OF PROOF.

Just about every lawmaker on Capitol Hill agrees you need a patients' bill of rights. But what they don't agree about is your access to the courts. This past Friday, by a margin of 59-36, the Senate passed its version of the patients' bill of rights. The Senate's version allows you to sue your employer, as well as your HMO. It sets no limit for claims of loss of wages and pain and suffering, and sets a $5 million cap on punitive damages in federal court. But in state court, there are no monetary caps.

President Bush has threatened a veto, saying it puts the interests of trial lawyers before that of the patient and will only drive up premium costs. Joining us today, to discuss all of this -- in Dallas, Texas, trial attorney George Parker Young. Here in Washington, Richard Smith, vice president of public policy for the American Association of Health Plans. Ron Pollack, executive director of Families USA. And James Klein, president of the American Benefits Council. And in the back row, Skyla Freeman (ph), Tiffany Hopkins (ph) and Brian Meyerhoeffer (ph).

Richard, I want to start right with you. These are called the patients' bill of rights. That has to do with every one of us, our rights as patients to deal with our medical care, a very serious and important issue to all Americans. So why are you against the bill as it presently stands

RICHARD SMITH, AMERICAN ASSOCIATION OF HEALTH PLANS: Roger, you're right, this goes to critical issues for all Americans, and choices are going to be made that are going to affect Americans' access to medical care, ad whether they get quality medical care or not. Right now, the Medical Association of Health Plans, its member health plans, believes that there's an opportunity to make great progress, specifically an opportunity to give every American an opportunity, when they disagree with a coverage decision that their health plan makes, to have that decision reviewed by panel of physicians who would make a decision that's binding on the health plan. That's an opportunity that individuals have in many states today; we now have 40 states with independent medical review.

COSSACK: Let me interrupt you for a second. Who decides who those panels of physicians are? The way you would have it done.

SMITH: Absolutely. There are two levels of decision. The first is a decision is made about which organization will do a review. As we read both bills, they are, essentially, identical. Both bills allow a state to have a process for assigning reviews, and if a state doesn't choose to elect that process, if the state chooses not to exercise its rights to assign panels, then a health plan has to with an organization that performs reviews.

COSSACK: Having these allegedly independent boards -- we'll discuss that a little more -- would you be for access to the courts, or would the independent panels be the final word?

SMITH: Roger, under current law individuals have an opportunity to go to court and get an order that a plan pay for a benefit, and even after we have an opportunity for an individual to get a binding decision by an independent panel of physicians, they would retain that right.

Where we believe policy makers are going in the wrong direction is where we're talking about unlimited economic, noneconomic, and punitive damage in court after the independent review, and we believe that that's drive costs up, coverage down and quality down.

COSSACK: Ron, respond.

JAMES KLEIN, PRESIDENT, AMERICAN BENEFITS COUNCIL: Well, this legislation, I think, is going to be of extraordinary value for America's consumers.

COSSACK: This is the legislation that the Senate just passed.

KLEIN: That's right. What it does is several things. One, it makes sure that decisions about our health care are now made by doctors and nurses, together with patients, rather than simply by people who never ever get to see the patient -- they are HMO bureaucrats, they have no training in terms of medical care. So now there's recourse to try to make sure that care is really made by the right decision makers, and what's very important here is that when care is improperly denied or delayed, you are going to have recourse.

One last thing: this idea about liability. I don't view this as an issue relating to big money damage. I don't think that's really at the heart of this. What is at the heart of this, which is very important for American consumers, is when health plans make decisions, now they're going to have to factor into those decisions that they may potentially have some significant liability, so Now they're more likely to get the decision right in the first place.

COSSACK: You want the rod, you want it hanging out there so the insurance companies understand that, in fact, if they make the wrong decision, they can be in court.

KLEIN: Absolutely.

COSSACK: Jim, isn't there a conflict of interest always, in describing these two positions, between the insurance company, who has shareholders and wants to make the most amount of profit -- nothing wrong with that -- versus the patient who wants the best health care and wants the most expensive health care.

KLEIN: No, there's really no conflict of interest at all, because really providing the right kind of care is also going to be less expensive in the long run, so the notion that quality and costs somehow are at counter-purposes to one another is an oversimplified and much-used kind of attack that's often made, I think. It gets a little bit more dicey than that.

We should also, once and for all, shelf the notion that it's these health insurance bureaucrats who are making these decisions. These are doctors who are making these decision who serve on these independent medical review panels.

The concept of an independent medical review panel exists currently, and employers and insurance companies use them.

COSSACK: Let me follow up with the answer you just gave me. You said if good medical care is, in the long run, the least expensive medical care, because it provides the kind coverage that we want, then there should be no worry about having access to the courts, because people aren't going to have to go...

KLEIN: Good point. I don't want to oversimplify it on my side. I don't mean to suggest that there aren't mistakes that are made, or that there aren't occasions where in order to cut corners or costs, a decision might be made. I just think that it's inaccurate to say that's always an inherent conflict of interest in the system. I think -- and you're going to hear me a lot, Rick and I echoing one another's points today, because I think that employers and their health insurance partners, who provide this coverage to our employees and the family members of our employees, really are of one mind about this type of thing -- that the way to resolve the issue is up front, get these honest, legitimate disputes resolved by independent medical reviewers, and then -- and only then -- if the employer or health insurance company refuses to abide by the decision of this independent medical reviewer, that yes, such and such should be covered, then you could go to court in order to enforce it, but not bypass it.

COSSACK: Let's take a break.

What's in it for you, and what's in it for me: better medical care, more time in the hospital, or more time in court? We'll talk bout that next when we come back.

(BEGIN LEGAL BRIEF)

On this day in 1964, the Civil Rights Act was signed into law by then-President Lyndon B.Johnson. Racial discrimination in education and in the workplace was prohibited by the act.

(END LEGAL BRIEF)

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

SEN. CHARLES SCHUMER (D), NEW YORK: I think the patients' bill of rights will go trough the House. The amount of support in the country is overwhelming. The president and the Republican majority in the House will oppose it at their peril.

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SEN. JUDD GREGG (R), NEW HAMPSHIRE: We believe that a better bill can be designed, which will address the needs of the patient, but will also allow employers -- and encourage employers -- to offer more health insurance rather than less health insurance.

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COSSACK: It makes sense to give patients some muscle when dealing with HMOs. We've certainly heard enough horror stories of administrators making medical decisions, and even limiting the time your doctor spends with you. But will the threat of litigation make HMOs more patient friendly or drive them out of business?

George, you've represented many patients in Texas, where you are, and you're working under the Texas patients' bill of rights, which is similar to a bill that the Senate is taking a look at. Tell us what your experience is. I mean, has there's been much litigation? Everyone is worried about the price of medical care going up.

GEORGE PARKER YOUNG, TRIAL ATTORNEY: No, we heard these same predictions four years ago when the Texas legislature passed a good bill. In fact, we're seeing about four lawsuits a year. The first lawsuit, and the biggest lawsuit, that was filed when the HMOs went to court to get independent review thrown out. They're been dragged kicking and screaming to the idea that we need independent review, and unfortunately, the one court decision we have down here struck down independent review, thanks to HMOs.

We're not seeing a lot of lawsuits, and when we do, they're usually very, very egregious, very serious harm to patients, and usually is instances where an independent review wouldn't have done any good -- it would have taken too long or did take too long, there were delays, delays and delays, or for some other reason, independent review was not something that would have made a difference.

COSSACK: George, if you open up the state courts and the federal courts, isn't that kind of giving a green light to our brother and sister trial lawyers who say they've open up the doors to the courts, so there's no reason why we shouldn't be going in?

YOUNG: No, and what we've seen in Texas, as I think we will see across the country, these are very difficult lawsuits to bring; you have to hire experts -- there are expert requirements in the Texas statute that I think most states will adopt, if they haven't already. We have some caps on punitive damage in Texas already. In terms of medical malpractice cases against hospitals and doctors, there are already malpractice caps; those may or may or may not get extended to HMOs.

COSSACK: But in the Senate form of the bill, at least, there are no caps.

YOUNG: No, except for the fact that Senate lets stay in play the caps in each state if patient decides to go to state court. The state court caps are left in place, and I think last time I saw 35 to 40 states have some kind of cap.

COSSACK: All right, Rick, here's the answer. The answer is here's a trial lawyer who says guess what, we don't go to court that often. There have been four lawsuits filed, one of them by the HMOs -- which they won -- to knock out independent review. Isn't that kind of the other side of the story, that in fact, the HMOs will be right in that court, trying to protect themselves, too.

SMITH: No, it's not the other side of the story, Roger. First, I think it should be clear that the health plans in Texas have all agreed to voluntarily adhere to the provisions of the Texas law governing independent review.

More than that, there are Texas-sized differences between the law being considered today and the law that Mr. Young is talking about. This is sufficiently important: I'm just going to read a sentence from the Fifth Circuit decision that dealt with this issue back in June of 2000: "The provisions of the Texas law do not encompass claims based on a manage care entity's denial of coverage for medical service recommended by a treating physician." That dispute is one over coverage specifically excluded by the act.

So there's really no relationship whatsoever between the Texas law and the law being considered here in Washington. In fact, the consequences of the law being considered in Washington would run far deeper and be far more destructive than the Texas law.

COSSACK: Ron, is there reason to believe there will be more litigation under the Senate law or the House law than there would under the Texas law? Isn't what we have to measure ourselves against?

I didn't think there's going to be much litigation. I don't know whether three, five -- I'm not sure that's important. What is important is that the health plans are going to know that, contrary to current law, they potentially have a liability that they've got to take into account before they decide to cavalierly deny or delay care.

RON POLLACK, FAMILIES USA: Under current law, you actually can sue an HMO. This is something that not a lot of people understand. You actually can take the HMO to federal court. But if you win, the status of current law is that the only thing you can win is the value of the service that was originally denied to you. That's like a slap to wrist; you're afraid you have cancer, and you want to go to a specialist, get a test, and your physician may feel you need surgery -- and the HMO turns you down. Then you litigate for two or three years, and at the end of the litigation, after you've won, the only thing you get is the monetary value of the service originally denied to you. That comes too little, too late.

So the HMOs know that they can deny and delay with impunity, under current law. Now, with the Senate bill, they're going to know that there's a potential liability, and they're going to get right in the first place.

COSSACK: Jim, let me ask you a question: Why should HMOs have any more protection than the people that make bad tires or bad anything? Why should they be in a special place, as opposed to the consumer, that other companies and corporations don't get?

KLEIN: I have to answer that question by clarifying one really important thing about this Texas matter which relates to that. Last week, Senator Gramm of Texas and Hutchinson of Texas offered up an amendment to the Senate bill that would have applied the Texas law standard to the federal McCain-Kennedy bill. That was defeated. I think it's a bit disingenuous for the advocates of the McCain-Kennedy approach to say that these worries about unfettered litigation are unfounded because look at the experience in Texas, but then oppose applying the Texas law standard to what the federal legislation would be. Clearly, there are more opportunities for litigation, for large state law causes of action.

(CROSSTALK)

COSSACK: But in and of itself, why is that so wrong?

YOUNG: Roger, let me respond to that.

COSSACK: George, hold on a second. I'm going to let Jim finish up.

Why is it so wrong? Why shouldn't HMOs have to answer like any other corporations?

KLEIN: I can answer that by telling you this: Under the Texas law, you are always able to sue for a medical malpractice experience that occurs. You are always able to get -- contrary to what Ron said -- injunctive relief to go into court, under current law, to ensure that something would be provided, if you can show there would harm in delay.

(CROSSTALK)

COSSACK: But under Rick's view of it, you wouldn't be able to do that.

Let me explain why.

COSSACK: Make it quick, because I've got to take a break.

The fact is we're for an unprecedented type of accountability, in which a benefit can be ordered. Policy makers make decisions all the time that balance between competing goals. We had a worker's compensation system that was based on tort liability; every state in the country got rid of it because it didn't work.

Doctors know the current liability system doesn't work. In fact, in Texas, doctors want to sue patients who are suing them for malpractice liability. Doctors know that the current liability system leads to higher costs and lower quality care. We have a better alternative: independent medical review. That's where we ought to go.

COSSACK: Let's take a break.

Will Congress beat the patients' bill of rights to death? We're going to see if there's any room for compromise right after this.

(BEGIN Q&A)

Q: According to a Justice Department report, how many firearms transfers or permits were rejected last year?

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A: 153,000, out of 7.7 million applications.

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COSSACK: Welcome back to BURDEN OF PROOF.

George, in last block, we kind of got around to what the bottom line is here, the theory being that you have to give immunity to HMOs -- or some form of limited immunity, at least -- as a trade off for the individual's ability to get good medical care, that if you open up the HMOs to the kind of liability that you and others are talking about, that the trade-off is going to be that patients are not going to get that kind of care, because of the probability of lawsuits, defense, and all those things that go along with lawsuits. Answer that.

YOUNG: That's counterintuitive. What we know from other industries -- every other industry in America -- is that if you have accountability, then people act responsibly. That's been a bedrock Republican principle for the last several elections, and at least some of the leadership seem to have forgotten it.

What we have in Texas -- just to address something that was raised a minute ago -- we have a number of different court opinions. Some judges are letting these case go forward in state court against the HMO, not only for medical malpractice, but for HMO malpractice, and we have no consistency. What we see is a separate-but-unequal system where sometimes there's accountability, and sometimes there's not.

What -- coming back to your point -- Senator Sibley, who was the leader in Texas on this bill was faced with this argument about having to give immunity or there's not going to be enough insurance for everybody, and we'll have uninsured people, he called that the Ford Pinto defense, that if we just make cars cheap enough, then everyone will have a car. That's not what we're about; that's not what anybody that's really thoughtful about this public policy really wants.

We want good medical care, and we want accountability at the end of the day, if it's necessary, for those folks that -- and we will always have these folks -- cut corners.

COSSACK: Let me start with Richard, and we'll go down the line.

Richard, in response to what George has said -- he said it's counterintuitive, that notion that the ability to get damages doesn't mean that you're going to have damages and that the stick is what's going to keep these insurance companies in line.

SMITH: Right, it may be counterintuitive for George, but there's a solid set of facts which demonstrates that the proposition as was stated is exactly right. We have a very, very good analogy to the kind of liability expansion that's now being proposed by the Senate. It's called the medical malpractice system, and the fact of the matter is that physicians will tell you that they are driven to deliver lower quality medical care as a result of that system, that there's less access to care, less innovation in care, and as I mentioned, the physicians in Texas actually filed a bill seeking to be able to sue their patients who sue them.

We also have very solid research from numerous different places that showing that jury verdicts in malpractice claims have nothing whatsoever to do with whether or not there was negligence on the part of the physicians.

COSSACK: Let me go to Ron. Ron, the answer being it's not counterintuitive, that if you open up the courts to these kinds of claims, the patient will suffer.

POLLACK: The patient is going to be the real winner in this process. The reason the patient is going to be the winner is the HMOs are not going to hassle them with a denial or a delay of care, because they they're potentially liable. What's incredible in this process is it's not just other corporations that are potentially liable; doctors are liable, nurses are liable, and hospitals are liable. And what's extraordinary is that the HMOs have carved out this special protection. What is truly extraordinary about it is that increasingly, they are making the decisions, taking those decisions out of the hands of doctors and nurses, yet they don't want to be held accountable for it.

COSSACK: Let me go to Jim. We've got about 20 seconds left. It's a big decision to take American people away from the courts, not to give people their day in court -- it's a bedrock foundation. Is that something we really want to do?

KLEIN: No, I think what we want to do is ensure that we only go to court as a last resort, and not as an initial matter, and therefore this notion of getting these issues resolved up front, before the injury occurs, is a real way to avoid people having to go to court.

COSSACK: Jim, I've got to go.

That's all the time we have for today. Thanks to our guests. Thank you for watching.

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