The Republican plan seeks to give the appearance of reform without the reality. Among other gaps, the Republican plan STILL:

• LEAVES MEDICAL DECISIONS IN THE HANDS OF INSURANCE COMPANY ACCOUNTANTS INSTEAD OF DOCTORS;

• DOES NOT GIVE ACCESS TO SPECIALITY CARE WHERE NEEDED;

• DOES NOT PROVIDE FOR CONTINUITY OF THE DOCTOR-PATIENT RELATIONSHIP;

• DOES NOT GIVE PATIENTS ACCESS TO NEEDED DRUGS OR CLINICAL TRIALS; AND

• PROVIDES NO EFFECTIVE MECHANISM TO HOLD PLANS ACCOUNTABLE WHEN PLAN ABUSE KILLS OR INJURES SOMEONE.

This memo describes what is in the Republican plan. The proposal is more notable for what it leaves out than what it puts in. We still have unanswered questions about the legislative language.

SIXTEEN PROTECTIONS MISSING FROM THE REPUBLICAN PLAN BUT INCLUDED IN THE PATIENTS' BILL OF RIGHTS:

1. Access to specialists. The Republican bill does not ensure access to specialty care. If a child with cancer needed to see a pediatric oncologist, there is no requirement that he or she would have access to that specialist.

2. Protection of doctor-patient relationship. The Republican bill lets insurance company bureaucrats decide what care is medically necessary. The health plan can define medical necessity any way it wants. The Patients' Bill of Rights defines medically necessary care based on the generally accepted principles of professional medical practice, and doesn't let the health plan arbitrarily interfere with the decision of the treating physician.

3. Prohibition on drive-through mastectomies and requirement of coverage for reconstructive surgery after mastectomy. The Republican proposal does not include this important protection for women.

4. Ability to hold plans accountable when abusive practices kill or injure patients. The Republican proposal does nothing to provide meaningful remedies in state court when abusive plan practices kill or injure a patient. Under their bill, a patient must still go to federal court, which is costly and difficult to access and the remedy is limited to the value of the benefit, and may in some instances, with clear and convincing evidence, get civil monetary penalties (CMPs) of $250 per day, up to $100,000. The Republican bill does little to change the status quo. The Patients' Bill of Rights grants no special privileges to the HMO industry and allows patients to seek meaningful remedies under state law.

5. Referrals outside of network . If an HMO's network does not include a provider qualified to treat a patient's condition, the Republican plan does not ensure access to an appropriate specialist outside of network.

6. Point of service (POS). The Republican POS option is full of loopholes so as to make it meaningless. There are exemptions for HealthMarts, exemptions if the employer does not want to contract with a plan to do it (even though it is at no extra cost to the employer), exemptions if premiums increase 1% (even though the cost is only borne by the enrollee).

7. Standing referrals and specialists as primary care physicians. The Republican plan does not allow patients with diseases or disabilities requiring continuing care by a specialist to have standing referrals that would avoid the need to obtain insurance company or primary care doctor permission for each visit, nor do they allow such individuals to designate their specialist as their primary care doctor. Children and adults with such diseases as cancer or severe arthritis will continue to face insurance company red tape every time they need to see their oncologist or rheumatologist.

8. Restrictions on prescription drugs. The Republican plan does not ensure that patients who have drug benefits can get the prescription drug their doctor prescribes they need. The Patients' Bill of Rights would not allow an HMOs to impose limitations and not prescribe access to necessary drugs even if they are not on the HMO's approved list (formulary).

9. Clinical trials. The Republican plan does not provide access to NIH, VA, or DOD approved quality clinical trials for patients with such conditions as advanced breast cancer or Alzheimer's Disease for which there may be no effective conventional treatment.

10. OB/GYN as primary care doctor. The Republican plan does not allow women to choose their obstetrician or gynecologist as a primary care doctor.

11. Emergency and post-stabilization care. The Republican plan only gets at a part of the problem. While a patient could still present himself to any emergency room, there is no protection that the out of pocket costs to the person wouldn't be unaffordable. "Severe pain" would not be a standard that a reasonable person could apply in going in the to the emergency room. The Republican bill also does not include guidelines for post-stabilization care which are critical for patients in an emergency situation and are also included in Medicare.

12. Continuity of care. The Republican plan does not allow a patient undergoing an active course of treatment or in their last trimester of pregnancy to continue with their doctor if their employer changes to an insurance plan that does not include their doctor, or if their doctor is suddenly dropped from their plan (for reasons other than quality or fraud).

13. Protections for patient advocacy. The Republican plan does not protect doctors and nurses from retaliation when they advocate for their patient's needed care.

14. Limits on improper financial incentives. The Republican plan does not limit HMOs' and insurance companies' use of improper financial incentives to limit needed care. Under the Republican bill, health plans could still penalize doctors financially for providing the best possible care for their patients.

15. Prohibition on gag rules. The Republican plan would still allow a health plan to restrict doctor-patient communication. The bill would not allow outright prohibition of communication, but is silent on the issue of restrictions.

16. Network adequacy. The Republican plan does not require that an HMO's network be adequate to meet its members' needs, so HMOs still would be allowed to operate with few doctors and long waiting periods for appointments. They could force patients to drive hours to get needed care, even if there are non-network providers nearby.

1. Prudent layperson standard. Like the Patients' Bill of Rights, the Republican plans uses a prudent layperson standard to cover emergency care, but the Republican standard would not include severe pain as a reason to go to the emergency room, and does not include post-stabilization and maintenance care guidelines following emergency care, as in Medicare. The Republican proposal would only provide very limited relief.

2. Direct access to OB/GYN and pediatricians. Like the Patients' Bill of Rights, the Republican plan allows direct access to ob/gyn care for women, but does not allow women to choose their ob/gyn as their primary care doctor. The Republican plan also allows direct access to pediatricians for children, but all plans currently allow children to have a pediatrician as a primary care giver. It does not guarantee access to pediatric specialists.

3. Point of service. The Republican plan requires a point of service for closed panel HMOs, however, it provides many loopholes and exemptions so as to make the protection meaningless. (See above)

4. Prohibition on gag rules. Like the Patients' Bill of Rights, the Republican plan prohibits gag clauses, but does not prohibit plans from restricting doctor-patient communication and does not deal with improper financial incentives, or protections for patient advocacy or termination from the plan without justification.

5. Medical privacy. Like the Patients' Bill of Rights, the Republican bill includes provisions relating to medical privacy. Whereas the Patients' Bill of Rights does not undermine current protections, the Republican bill would make individual medical records vulnerable.

6. External review of plan decisions. Like the Patients' Bill of Rights, the Republican bill provides for external review of plan decisions. Unlike the Patients' Bill of Rights, however, the Republican proposal has a number of loopholes. The external review is restricted to questions of whether or not the plan followed its own medical necessity guidelines or whether or not a treatment is experimental. This continues to leave the plan as judge and jury in many important decisions, such as whether the beneficiary has followed the "prudent layperson" standard in seeking emergency care. You are only entitled to what the plan says it owes you. The Republican proposal also does not make external appeals available to people buying insurance in the individual market.

7. Plan information. Like our Patients' Bill of Rights, the Republican proposal requires plans to provide specified information to subscribers, but the Republican plan does not require the provision (or even collection) of any quality information.

While the Republican bill is lengthy, it does not appear to offer all protections for everyone. For example, only individuals in plans governed by the Employee Retirement Income Security Act (ERISA) would have access to an external appeal, people in the individual market would have no such appeal. Additionally, the point of service (POS) provision does not apply to plans in the individual market. Information disclosure, access to ob/gyn care and emergency room care provisions do not apply to people in the individual market. The Republican plan therefore leaves out at least 15 million people in the individual insurance market.

REPUBLICAN POISON PILLS

The Republicans have added a number of provisions that would take away existing consumer protections, leave consumers in vulnerable situations susceptible to fraud and abuse, and fracture the existing insurance market.

HealthMarts. The Republican plan created HealthMarts under the guise of offering choice to individuals in small businesses. In reality, HealthMarts would be able to selectively pick what areas they offer their product in, avoid many state consumer protection laws, and selectively contract with providers to avoid enrolling people in certain areas. These entities would skim the healthy out of the insurance market, leaving everyone else with increasingly unaffordable premiums.

Association Health Plans (AHPs) or Multiple Employer Welfare Arrangements (MEWAs). The Republican plan would allow more AHPs. These entities would have some preemption of state rating requirements, full preemption of state benefit mandates, and adverse selection problems. Blue Cross Blue Shield believes these entities would destabilize the insurance market.

Medical Savings Accounts (MSAs). The Republican plan expands the current MSA demonstration, and allows employees covered under Federal Employees Health and Benefits Plan (FEHBP) to join MSAs. Not only is this a drain on the federal treasury, but MSAs encourage adverse selection in the insurance market, and offer little protection in the event an individual becomes sick. Before expanding MSAs the Republicans ought to see how the current demonstration evolves.

[July 21, 1998]

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