Washington Watch

The Senate debate over the Patients' Bill of Rights made for great theater, but was the outcome ever in doubt? By the time Vermont Sen. Jim Jeffords defected from the Republican party, the handwriting was on the wall; not only had the Democrats seized the power to set the Senate calendar — they also were suddenly in a position to set the agenda, rather than take potshots at the majority-backed bill.

When it returns from recess later this month, the House will begin consideration of legislation modeled on that which the Senate passed, 59–36. Blessing from the House is far from certain, and any bill that resembles the Senate legislation would be DOA on President Bush's desk. But for now, momentum is with the Democrats.

The Senate-passed bill, championed by Sens. Edward Kennedy of Massachusetts and John Edwards of North Carolina, both Democrats, and Arizona Republican John McCain, was unrepentant in its disdain for HMOs. The bill allows for lawsuits in federal courts for administrative decisions, while state courts retain their traditional oversight of medical issues. The bill places no cap on the amount a patient can recoup for treatment or pain and suffering, while allowing punitive awards of up to $5 million. The White House favored an alternative measure, sponsored by Tennessee Republican Bill Frist, Louisiana Democrat John Breaux, and, ironically, Jeffords himself, that would have limited pain-and-suffering awards to $750,000 under a narrow range of issues — namely, if negligent delays in care resulted in patient harm — and would have disallowed punitive damages.

The Senate-passed bill requires that patients go through independent review before filing a lawsuit, thanks to an amendment that passed, 98–0, hours before the vote on the final bill. The legislation also includes other areas of interparty agreement, such as granting access to OB/Gyns without a referral and allowing patients to seek emergency care from the nearest ER, regardless of whether the hospital is in a health plan's provider network.

Worried about the middle

At first, outward appearances after Jeffords left the GOP suggested that control or no, the Democrats' ability to drive the issue was no certainty. "The party labels have changed, but the members of the Senate have not," one observer close to the debate noted at the time. "You're going to have the same people voting the same way on these issues. You'll see a reshuffling of the legislation, so in that sense it's the same agenda, but things aren't in the same order."

That reshuffling, though, gave South Dakota Democratic Sen. Tom Daschle an opportunity to show off his leadership skills in his very first test as majority leader. Daschle united his party behind the Kennedy-Edwards-McCain bill, as evidenced by the fact that all 50 Democratic senators toed the line. Then, while insisting he'd had enough negotiation with the Bush administration ("We can't go any farther to the right because we'd lose the middle in the compromise"), he went to work on bringing a handful of maverick Republicans not named McCain into the fold — revising and refining the bill to accommodate the various interests of the health care industry, business, and consumers. The deal maker may well have been an amendment, sponsored by Maine GOP Sen. Olympia Snowe, that protected most employers from liability.

In the end, nine Republicans sided with Daschle. Jeffords, whose differences with the White House led him to turn independent, voted for the Bush-backed bill.

The most immediate focus now will be in the House, where lobbying will be intense. The American Association of Health Plans and the Health Insurance Association of America warn that the proposals in play would decrease affordability of health care and cause some employers to drop benefit coverage altogether. A Congressional Budget Office analysis of the Senate-passed bill estimates that its provisions would add about 2 percent to the cost of health care premiums. But that's only an average; employers with self-funded benefit plans are not granted immunity by the Snowe amendment, and for them, costs could go a lot higher in the face of a single lawsuit.

That group constitutes 6 percent of employers, but includes some large companies. Already, Caterpillar, the heavy-equipment maker that covers 150,000 people, and Motorola, the electronics company that provides benefits to 230,000 workers, families, and retirees — both of which are self-insured — are very concerned about the direction the debate has taken in Washington. Expect a fight on this front, at minimum.

Winning the hearts of physicians will be key, too, despite the AMA's wearing its support of the Senate-passed bill on its sleeve. By AAHP's count, 17 physician specialist groups supported the Frist bill in the Senate, the AMA's position that the Kennedy bill is "the only bill acceptable to the physician community" notwithstanding.

When Frist introduced his measure in May, Georgia Republican Rep. Charlie Norwood — who has long championed patients' rights — denounced the bill as protecting "HMOs, not patients," and threw his support to Kennedy-Edwards-McCain. Norwood may have hardened sides by promising that "if [the Frist bill] is brought up in the House, I will personally exhaust every effort to defeat it." In an effort to keep Republicans from following Norwood, House Speaker Dennis Hastert drafted legislation June 22 modeled on the Frist bill but including a slightly broader right to sue than the GOP Senate bill delivers.

Regardless of what Congress and the White House do, the issue of liability, at least, may be far from over. In its zeal to allow health plans to be sued, the Senate did not amend the Employee Retirement Income Security Act, the 1974 law that has shielded HMOs from liability. Sharp-eyed lawyers picking out discrepancies between ERISA and any new law could could mount a constitutionality test that could tie up the issue in court for years.

-- Michael Levin-Epstein and Michael D. Dalzell

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