Why a patient's bill of rights?

Business and Economic Review, Jan-Mar 2001 by Barakat, Pierre

". . . millions of Americans are looking for a strong, bipartisan Patients' Bill of Rights to protect them and their families from the heavy-handed measures of managed care companies."

Managed care has become the dominant form of private health insurance in the United States, accounting for roughly 85 percent of those with employer-sponsored coverage. Insurance plans include health maintenance organizations (HMOs) as well as networks that let patients select from a wider, but still limited, list of doctors. For most Americans, the switch to HMOs and other forms of managed care has come as employers try to control rising insurance costs. In these plans, a consumer pays less for the services of doctors and hospitals affiliated with a particular program. Also, providers agree to accept smaller fees in exchange for a guaranteed number of patients.

Complaints are growing, however, about coverage provided by these plans. Over the past few years, the quality and performance of managed care organizations have become a major political issue in Washington and throughout the nation. More and more people have been seeking legal action against their HMOs for lack of coverage for treatments. Citizens want to make informed, educated decisions; to have their medical records protected and kept confidential; to have better access to, and more choices of, health care providers; and to have providers meet a common sense standard of care in the emergency room.

Case in Point

Jerry Cannon's wife Phyllis died from leukemia in 1992. He thinks she might be alive today if her health insurance company had approved a bone marrow transplant in time. Phyllis Cannon was diagnosed with acute leukemia in 1991. But there was hope. With a transplant the only cure for her disease, the Cannon family called their insurance company, which assured them that the transplant would be covered.

After a year of chemotherapy to bring the cancer into remission, the doctor cleared Phyllis for the surgery. However, there was one small caveat. The Cannons still needed the final approval of their insurance company, which, by the end of the day, had refused to give authorization for the transplant.

Blue Links of Oklahoma City, a Blue Cross HMO, refused to pay for the $150,000 operation, saying the policy had been changed, and the transplant was no longer covered. After nearly two months of appeals by the Cannons to the HMO's grievance committee, Blue Links reversed its decision and agreed to cover the bone marrow transplant. But it was too late. During the time in which her claim was being disputed, Phyllis Cannon's leukemia had come back, the bone marrow transplant became infeasible, and she died a few weeks later.

Jerry Cannon learned afterward that based on the law called ERISA, he cannot sue the insurance company for wrongful death or bad faith. ERISA, the Employee Retirement Income Security Act of 1974, was designed to shield pension and benefit plans from lawsuits. However, it had the unintended effect of exempting HMOs from being sued for medical malpractice.

Backlash

For several years now, there's been a growing backlash against managed care, both from consumers and the medical profession. The biggest concern is that the drive to reduce costs is coming at the expense of the quality of care. In response, millions of Americans are looking for a strong, bipartisan Patients' Bill of Rights to protect them and their families from the heavy-handed measures of managed care companies. Support for such a bill cuts across party lines. Polls show that almost as many Republican as Democratic voters want to see it enacted. Roughly 40 states have already put some of these protections on the books.

In Congress, each party is offering a so-called "Patients' Bill of Rights." Both bills require health plans to pay for emergency room access when a person's health appears to be in serious jeopardy. And both proposals would increase patients' access to some specialists like obstetricians and gynecologists. But there are key differences. The Democrats' version would cover all Americans in managed care. Many of the Republican bill's provisions would cover only the 48 million Americans in self-funded employer health plans. The Democrats' bill would give doctors a greater say in determining what services are medically necessary, both in original coverage decisions and on appeal. In addition, the Democrats' bill would give patients the right to sue their health plans in state court if coverage decisions led to personal injury or wrongful death. The Republicans disagree on these points, but do offer a ban on discrimination based on genetic testing and a tax deduction for self-employed Americans who buy their own health insurance. The whole debate comes down to one critically important question: Who should make medical decisions - doctors or insurance companies?

On the private front, a coalition of business groups and health insurance providers has been running a multi-million-dollar national advertising campaign warning that new regulations mean higher costs. The coalition's concerns, according to Karen Ignagni of the American Association of Health Plans, include: What should the industry effort be all about? What is the role of the government? What is the balance point between private sector and public sector activity? Would the industry deal with one federal legislature or 50 state legislatures?