The backlash against managed care

Nation's Business, July, 1998 by Stephen Blakely

The bills also would establish consumer protection standards for managed-care plans, such as grievance and appeals procedures for disputed actions.

The Patients' Bill of Rights Act This legislation was introduced on behalf of the Democratic leadership in Congress by Rep. John Dingell, D-Mich., and Senate Minority Leader Tom Daschle, D-S.D. The companion bills' designations am H.R. 3605 in the House and S. 1891 in the Senate.

The measures would write into law the proposals on patients' rights developed last year by President Clinton's Advisory Commission on Consumer Protection and Quality in the Health Care Industry.

However, the legislation goes well beyond the commission's recommendations for voluntary action by the health-cam industry in several respects. Most notably, it would adopt a provision--similar to PARCA's--to allow patients to sue their health plans for malpractice.

Congressional GOP leadership proposals. These measures are being developed by Republican task forces in the House and Senate. They are expected to avoid mandates and rely instead on tax incentives to make health insurance more affordable.

For example, House Ways and Means Committee Chairman Bill Archer, R-Texas, has said he is considering allowing a tax deduction for the health premiums paid by those whose employers do not offer health insurance. Committee staff members indicate his proposal may also make health insurance for self-employed people fully tax deductible in 1999. Current law phases in the deduction from 45 percent now to 100 percent in 2007.

House Commerce Committee Chairman Tom Bliley, R-Va., is also developing a bill that reportedly would blend some of PARCA's patient protections--but not the right to sue health plans or employers--with medical-malpractice reform.

Expansion of the Portability and Health Insurance Coverage Act. This legislation, H.R. 1515 in the House and S. 729 in the Senate, is strongly supported by the business community.

Sponsored by Rep. Harris Fawell, R-Ill., and Sen. Tim Hutchinson, R-Ark., these bills would allow small businesses to band together to purchase health insurance through trade, church, or business organizations. The new purchasing groups generally would be exempt From state health and consumer-protection laws.

RELATED ARTICLE: A New Formula For Health Insurance?

On most issues, Rep. William M. Thomas of Southern California is as solid and conservative a Republican as you'll find in Congress. But on health cam, he is promoting an idea he describes as radical, which ultimately would scrap the current system of employer-provided health insurance.

Thomas wants to restructure the federal tax code to end the deduction given to employers who pay for their worker's health insurance. Instead, he says, individuals should be responsible for buying their own health insurance and should get a personal tax credit for doing so.

The size of the tax credit would vary inversely with income: The smaller a person's income, the larger the credit.

While the concept is still being developed--no legislation has been introduced--Thomas and a colleague on the House Ways and Means Committee, Rep. Jim McCrery, R-La., are suggesting a private system of universal health coverage that would require all workers to purchase health insurance.